/raid1/www/Hosts/bankrupt/TCR_Public/060726.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, July 26, 2006, Vol. 10, No. 176
Headlines
ADVANCED MICRO: Earns $89 Million in Quarter Ended July 2
ADZONE RESEARCH: Cash Burn & Losses Prompt Going Concern Doubt
AEROSOL PACKAGING: U.S. Trustee Appoints Five-Member Committee
AH-DH APARTMENTS: Proposes to Pay All Creditors in Full Under Plan
AH-DH APARTMENTS: Cornerstone Seeks Exclusive Period Termination
AMCAST INDUSTRIAL: GAMCO Insists on Right to Buy Property for $1
AMCAST INDUSTRIAL: Court Approves Asset Sale to BIDITUP and H&B
ASARCO LLC: Gerald Metals Wants Court to Dismiss Complaint
AVENTINE RENEWABLE: Tender Offer Completion Cues S&P to Up Rating
AVENUE FINANCIAL: Shareholders Approves Debt Restructuring Plan
BETH ISRAEL: Wants to Hire Kaufman Borgeest as Healthcare Counsel
BIO-KEY INT'L: Restates First Quarter 2006 Financial Statements
BLACK PRESS: S&P Rates CDN$367.4 Million Bank Loan Facility at B+
BROOK MAYS: Section 341(a) Meeting Scheduled for August 11
BUFFALO COAL: Carl DelSignore Wants Consolidation Motion Denied
CALIFORNIA STEEL: Earns $36.3 Mil. in 2nd Quarter Ended June 30
CALPINE CORP: Wants to Sell TransCanada Transpo Service Contract
CALPINE CORP: Gets Open-Ended Deadline to Decide on Leases
CATHOLIC CHURCH: Dist. Ct. Overrules Spokane Estate Dispute Order
CG MULTIFAMILY: Hires Haynes & Boone as Insurance Coverage Counsel
CG MULTIFAMILY: Hires Weil Gotshal as Environmental Counsel
CHENIERE ENERGY: Closes $1.5 Billion Amended Credit Facility
CLAIRVEST GROUP: Investigates Issue of $10 Million Loan Default
COLLINS & AIKMAN: Names James W. Wynalek as Plastics Ops President
CONTINENTAL AIRLINES: Earns $198 Million in 2006 Second Quarter
CORPORATE AND LEISURE: Hires Michael Carmel as Bankruptcy Counsel
CORPORATE & LEISURE: Court Denies Receiver's Call to Dismiss Case
CROWN HOLDINGS: Reports $1.805 Bil. Net Sales in 2nd Quarter 2006
DANA CORP: Gets Agents' Okay to Move Challenge Period to Dec. 15
DANA CORP: Unions Balk at Burns, et al. Employment Agreements
DELPHI CORP: Retains Rothschild to Explore Sale Options for Unit
DELPHI CORP: Court Approves Executive Bonus Plan Extension
DYNEGY HOLDINGS: Moody's Rates $297 Million Senior Notes at B2
DYNEGY HOLDINGS: Fitch Rates $297 Million Senior Notes at B-
DYNEGY HOLDINGS: S&P Rates $297 Million Senior Notes at B-
EASTMAN KODAK: Can Sue Wachovia Over $8-Mil. Loan, Court Rules
ELINEAR INC: March 31 Working Capital Deficit Tops $3.8 Million
ENRON CORP: Wants Court to Approve Oneok Settlement Agreement
ENRON CORPORATION: Canada Unit to Liquidate and Dissolve
ENTERGY NEW: Plaintiffs Respond to Summary Judgment Requests
ENTERGY NEW ORLEANS: Court Okays Panel's Reconsideration Motion
EXIDE TECHNOLOGIES: Court Approves Transition Plan on Trademark
EXIDE TECHNOLOGIES: Board Adopts Short-Term 2007 Incentive Plan
FAIREL ANDERSON: Case Summary & Largest Unsecured Creditor
FDL INC: Judge Otte Converts Proceeding to Chapter 7 Liquidation
FORD MOTOR: Posts $123 Mil. Net Loss for the Second Quarter 2006
FREESTAR TECH: Files Amended Financial Statements
FRIEDE GOLDMAN: Liquidation Trustees Want Trust Extended for 3 Yrs
FTD INC: Moody's Rates $150 Million Senior Term Loan at Ba3
GENERAL MOTORS: Secures New $4.63 Billion Debt Facility
GLOBAL HOME: Has Until Jan. 15 to Remove State Court Civil Suits
GRAN TIERRA: Deloitte & Touche Expresses Going Concern Doubt
HCA INC: Earns $295 Million For Quarter Ended June 30
HCA INC: Leveraged Buyout Prompts Moody's to Review Ratings
HCA INC: Merger Agreement Prompts S&P's Negative Watch
HEALTHWAYS INC: S&P Rates $400 Million Senior Facility at BB
IMPERIAL PETROLEUM: Files 2006 First & Second Quarter Financials
INCO LTD: Earns $400 Million in 2006 Second Quarter
INEX PHARMA: Expects Tekmira Spin-out Completion by September 2006
INTREPID TECH: Posts $485,817 Net Loss in Quarter Ended March 31
IRON MOUNTAIN: Moody's Rates $200 Million Senior Notes at B3
JEANTEX GROUP: Posts $1.3 Million Net Loss in First Quarter
KAY HAYWARD: Case Summary & 20 Largest Unsecured Creditors
KOMFORT CARE: Case Summary & 20 Largest Unsecured Creditors
LANDRY'S RESTAURANTS: S&P Puts BB- Corp. Credit Rating on Watch
LEVITZ HOME: Secures New $89 Million Revolving Credit Facility
LOVESAC CORP: Wants Settlement with Series A Investors Approved
MACREPORT.NET: Incurs $324,401 Net Loss in Quarter Ending May 31
MEDICALCV INC: Auditor Expresses Going Concern Doubt Over Losses
MERCURY INTERACTIVE: Inks Merger Deal with Hewlett-Packard
MERCURY INTERACTIVE: Will File 2005 Annual Report in Third Quarter
MIRANT CORP: Excluded Debtors Want Until December 6 to File Plan
MIRANT CORP: Equity Panel Counsel Insists on No Fee Enhancement
MONUMENT BOWL: Voluntary Chapter 11 Case Summary
NAKOMA LAND: Chapter 11 Trustee Wants to Sell Clio California Lot
NBC/AUSTIN WINDRIDGE: Court Allows KREEC to Record Trustee's Deed
NES RENTALS: Completes $850 Million Sale to Diamond Castle
NORTHWEST AIRLINES: Wants to Assume Orbitz Hosting Agreement
OCA INC: Court OKs Amended and Restated Joint Disclosure Statement
OLESEN CONSTRUCTION: Case Summary & 20 Largest Unsecured Creditors
ONEIDA LTD: Has Until October 15 to Make Lease-Related Decisions
PARMALAT GROUP: Parmalat Venezuela in Talks to Sell Two Plants
PARMALAT USA: U.S. Debtors Balk at Two New Jersey Claims
PERSISTENCE CAPITAL: Ch. 11 Trustee Wants Case Converted to Ch. 7
PREFERREDPLUS TRUST: Cooper Tire Action Cues S&P's Negative Watch
PRESIDENT CASINOS: Equity Deficit Widens to $8.69 Mil. at May 31
PTC ALLIANCE: Emerges from Chapter 11 Protection
QUAIL MARKETING: Case Summary & Six Largest Unsecured Creditors
QUEST MINERALS: Inks Debt Restructuring Pact with Noteholders
REMOTE DYNAMICS: Posts $2.7 Mil. Net Loss in Quarter Ended May 31
RENATA RESORT: Court Sets July 31 as Bar Date for Filing Claims
REXNORD CORP: S&P Holds Junk Rating on $785 Million Senior Notes
RIEFLER CONCRETE: Can Loan Funds & Use Cash Collateral Until Sept.
SAINT VINCENTS: Judge Hardin Approves Hospital Sale to Bayonne
SEPRACOR INC: Balance Sheet Upside-Down by $109 Million at June 30
SIRIUS SATELLITE: FCC Reviewing FM Transmitters' Compliance
SPARKLE SPRING: Case Summary & 20 Largest Unsecured Creditors
THERMADYNE HOLDINGS: Amends Financial Covenants With Lenders
TOWER PARK: March 31 Balance Sheet Upside-Down by $5.2 Million
UNITED ENERGY: Carl DelSignore Balks at Consolidation Proposal
UTGR INC: Increased Expansion Costs Cue S&P's Negative Outlook
VARIG S.A.: Cutting 9,500 Jobs Under Restructuring Plan
VARIG S.A.: Brazilian Agency Vetoes Flight Suspensions
VESTA INSURANCE: Unable to Pay Interests Due July 15
VESTA INSURANCE: Bondholders File Involuntary Chapter 7 Petition
VESTA INSURANCE: Involuntary Chapter 7 Case Summary
VJCS ACQUISITION: S&P Junks Rating on $55 Million Senior Debts
WCI COMMUNITIES: Moody's Reviews Ratings and May Downgrade
WERNER LADDER: Committee Wants Greenberg Traurig as Co-Counsel
WERNER LADDER: Wants To Honor Incentive-Based Bonus Plans
WINDOW ROCK: Wants to Borrow $1M from Prestige to Fund Inventory
WINFIELD CAPITAL: Written Claims Must be Filed by August 21
WOMEN FIRST: Trust Wins Disputed $656,184 McKesson Escrow Fund
* Upcoming Meetings, Conferences and Seminars
*********
ADVANCED MICRO: Earns $89 Million in Quarter Ended July 2
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Advanced Micro Devices Inc. reported sales of $1.22 billion,
operating income of $102 million, and net income of $89 million,
for the quarter ended July 2, 2006. These results include
$18 million of employee stock-based compensation expense and a net
gain of $10 million associated with Spansion LLC's repurchase of
its 12.75% senior subordinated notes.
In the second quarter of 2005, excluding the Memory Products
segment, AMD reported sales of $797 million and operating income
of $83 million. In the first quarter of 2006, AMD reported sales
of $1.33 billion and operating income of $259 million.
"While we achieved 53% year-over-year sales growth and recorded
our twelfth consecutive quarter of greater than 20% year-over-year
microprocessor sales growth, we are dissatisfied by not reaching
our second quarter sales target," said Robert J. Rivet, AMD's
chief financial officer.
"We are particularly pleased with the continued adoption of AMD
solutions in the commercial segment. In particular, AMD Opteron
processor sales grew 26% sequentially and we believe we gained
server processor market share in the quarter. Sales to our
largest global customers grew quarter-over-quarter as we continued
to successfully execute our strategy. Sales through the
distribution channel were down, primarily because we chose not to
participate in certain deeply-discounted opportunities."
"Second quarter manufacturing execution was outstanding, with Fab
36 ramping 300mm capacity aggressively at mature yields. In
addition, Chartered Semiconductor is now in production of AMD
products."
Second quarter sales were down from the prior quarter primarily
due to the challenging pricing environment for high-volume desktop
processors which negatively impacted average selling prices.
Total microprocessor unit shipments were down four% sequentially.
Record AMD Opteron processor sales were driven by growing demand
for single- and multi-socket server and workstation solutions.
AMD Opteron processor unit shipments experienced double digit
percentage growth quarter-over-quarter, and the sequential ASP%age
increase was in the single digits.
Second quarter gross margin was 56.8%, compared to 58.5% in the
first quarter of 2006. The gross margin decrease was largely due
to lower desktop processor ASPs. Operating income was $102
million in the second quarter, up from $83 million in the second
quarter of 2005 and down from $259 million in the first quarter of
2006. The decline in operating income from the prior quarter was
due largely to lower sales and increased operating expenses
related to an extra week of operations in the quarter, and
marketing expenses in support of the company's long-term goals to
acquire new customers, expand business with existing customers,
and increase commercial sales.
About AMD
Based in Sunnyvale, California, Advanced Micro Devices Inc. (NYSE:
AMD) -- http://www.amd.com/-- is a global provider of
microprocessor solutions for computing, communications and
consumer electronics markets.
* * *
As reported in the Troubled Company Reporter on July 25, 2006,
Moody's Investors Service placed the ratings of Advanced Micro
Devices, Inc. under review for possible downgrade following an
agreement to acquire ATI Technologies for approximately
$5.4 billion.
Financing is expected to consist of approximately $4.2 billion
of cash and $1.2 billion of AMD's common stock. ATI, with
approximately $2.2 billion of latest twelve month revenues, is a
leading vendor or graphics processors that enhance the display of
PC's, portable devices, and other consumer electronics devices and
is based in Toronto Canada. The acquisition, which has been
approved by both boards of directors, is expected to close by the
fourth quarter of 2006 and is subject to customary approvals and
consents.
Ratings under review for downgrade include the Company's Ba3
Corporate Family Rating; B1 rating of its Senior unsecured note
$390 million due 2012; (P)Ba3 rating of its Senior secured shelf
registration; (P)B1 rating of its Senior unsecured shelf
registration; (P)B2 rating of its Subordinated shelf registration;
and (P)B3 rating of its Preferred stock shelf registration.
ADZONE RESEARCH: Cash Burn & Losses Prompt Going Concern Doubt
--------------------------------------------------------------
Holtz Rubenstein Reminick LLP expressed substantial doubt about
AdZone Research, Inc.'s ability to continue as a going concern
after auditing the Company's financial statements for the year
ending March 31, 2006.
The auditor pointed to the Company's substantial losses and
significant levels of cash used in developing its operations since
inception.
The Company posted a $12,005,573 net loss on $154,781 of revenues
for the year ending March 31, 2006.
As of March 31, 2006, the Company's balance sheet reflected assets
amounting to $1,149,670 and debts totaling $3,745,544, resulting
in a $2,595,874 stockholders' deficit.
Liquidity during fiscal 2006 and 2005 was provided principally
through the sales of equity securities, loans and the exercise of
options under the Company's stock option plan. The Company's
management said there is no guarantee that the Company will be
successful in raising cash from the sale of unregistered
securities or through loans. Total proceeds from sales of equity
securities were $225,200 during fiscal 2006 and $1,456,863 during
fiscal 2005. Total proceeds from loans during fiscal 2006 and
2005 were $815,000 and $125,000.
A full-text copy of the Annual Report in Form 10-K filed with the
Securities and Exchange Commission is available for free at:
http://ResearchArchives.com/t/s?e4b
Headquartered in Calverton, New York, AdZone Research, Inc.
engages in the extraction of data through the monitoring of
Internet Web sites. The company operates as an Internet
advertising research firm that provides various market research
statistics and other focused information on the Internet. The
company focuses on providing Internet analysis of security related
data transmissions. AdZone, through NetGet Internet monitoring
technology, a subscription-based online application, accesses data
from Web sites that are hosted within the United States, the
United Kingdom, Europe, and Asia, and provides such data to its
clients in various customizable report formats. The company
markets its products and services through email distributions,
direct sales contacts and its Web sites. The company hosts two
Web sites at http://www.adzoneinteractive.com/and
http://www.adzoneresearch.com/
AEROSOL PACKAGING: U.S. Trustee Appoints Five-Member Committee
--------------------------------------------------------------
The U.S. Trustee for Region 21 appointed five creditors to serve
on an Official Committee of Unsecured Creditors in Aerosol
Packaging, LLC's chapter 11 case:
1. Summit Packaging Systems, Inc.
Attn: Michael E. Conway, CFO, CPA
400 Gay Street
Manchester, new Hampshire 03103-7460
Tel: (603) 669-5410
Fax: (603) 668-2758
2. Ball Aerosol and Specialty Container, Inc.
f/k/a US Can Company
Attn: Rob Garside, Director Credit and Collection
10 Longs Peak Drive
Broomfield, Colorado 80021-2510
Tel: (303) 460-3790
Fax: (303) 460-3716
3. Newman-Green, Inc.
Attn: Edward H. Green, Jr., President
57 West Interstate Road
Addison, Illinois 60101
Tel: (630) 543-6500
Fax: (630) 543-8523
4. Temps Excel, Inc.
Attn: Nancy Nollner, President
234 Nelson Street
Cartersville, Georgia 30120
Tel: (770) 383-8773
Fax: (770) 383-8776
5. BWay Corporation
Attn: Yolanda Wooley, Credit & Collections Manager
8607 Roberts Drive, Suite 250
Atlanta, Georgia 30350
Tel: (770) 645-4861
Fax: (770) 645-4865
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 Canton, Georgia, Aerosol Packaging, LLC, aka
Aerosol Specialties -- http://www.aerosolspecialties.com/-- is a
manufacturer, and a private label & contract filler of aerosol,
liquid filling products, durable undercoatings, paints, fabric
treatments, and personal care items. The Debtor filed for chapter
11 protection on June 21, 2006 (Bankr. N.D. Ga. Case No. 06-
67096). Brian L. Schleicher, Esq., and P. Steven Kratsch, Esq.,
at Jampol, Schleicher & Jacobs, LLP, represent the Debtors. 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.
AH-DH APARTMENTS: Proposes to Pay All Creditors in Full Under Plan
------------------------------------------------------------------
AH-DH Apartments, Ltd., and its debtor-affiliates delivered their
Joint Plan of Reorganization to the U.S. Bankruptcy Court for the
Eastern District of Texas in Sherman on July 3, 2006.
The Debtors' Plan provides for Creditors to be paid from rental
income generated by the Reorganized Debtors' apartment complexes
in addition to a preferred equity investment of $25 million by an
affiliate of Vintage Capital Group, LLC. All creditors will be
paid in full pursuant to the Debtors' plan.
Treatment of Claims
All Allowed Administrative Claims and Tax Priority Claims will be
paid in full within 10 days after the effective date of the Plan.
Ad Valorem Property Tax Claims will be paid in full over a period
of 6 years, in monthly installments beginning on the first month
after the effective date. Claims under this class will accrue
interest at a rate of 4.5% per annum.
The secured claims of Citigroup Global Markets Realty Corporation,
fka Salomon Brothers Realty Corporation, will be paid on the
effective date through a cash payment of $20 million from the
proceeds of Vintage's investment and the issuance of new notes by
each of the Debtors in the amount of the respective remaining
balances of Citigroup's claim against them. Material terms of the
new notes include:
a) Maturity Date: 24 months following the effective date;
b) Interest Rate: 6.8% per annum;
c) Payments: Monthly installments of interest only until
maturity;
d) Collateral: Each of the New Notes will be secured by the
first lien deed of trust mortgages on the respective
apartment complexes secured by the Reorganized Debtor
issuing the note. Each New Note will also be secured by
a collateral assignment of rents from the respective
Reorganized Debtor's apartment complexes.
e) Escrows: The Reorganized Debtors issuing the New Notes
will pay appropriate monthly escrows for insurance and
taxes, which escrow balances shall be held in accounts
designated by Citigroup;
General Unsecured Creditors will be paid in full in three equal
monthly installments, with the first installment due 15 days
following the effective date.
Equity Interest Holders will retain their interests in the
Reorganized Debtors. However, a single-purpose remote limited
liability company will be formed, whose members will include
Dalcor Realty LLC, Burke, Mayborn Company, Ltd., and Vintage.
This new company will hold 100% of the Equity Interests in the
Reorganized Debtors owning these 14 Apartment Complexes:
AH-DH Apartments, Ltd.:
- Aubry Hills Apartments (190 units), 8926 N. Larmar, Austin,
Texas 78753;
- The Berkshire Apartments (227 units), 8600 Theta Drive,
Houston, Texas 77034;
- Pointe at Steelplechase Apartments (316 units), 8901 Jones
Road, Houston Texas 77065;
- Sheffield Square Apartments (190 units), 14814 Perthshire,
Houston, Texas 77079;
- Park on Burke Apartments (160 units), 4747 Burke Road,
Houston, Texas 77504;
- Princeton Club Apartments (290 units), 14800 Memorial,
Houston, Texas 77070; and
- Timber Run Apartments (156 units), 13000 Woodforest Blvd.,
Houston, Texas 77015.
HT Apartments Limited Partnership:
- The Meadows Apartments (480 units), 10615 Meadowglen,
Houston, Texas 77042;
- Walnut Bend (556 units), 10881 Richmond Avenue, Houston,
Texas 77042; and
- Spring Meadows (304 units), 3401 Ocee, Houston, Texas
77063.
DH Apartments Limited Partnership:
- Bay Crest Apartments (96 units), 16415 Buccaneer, Houston,
Texas 77062;
- Hayes Place (307 units), 2305 Hayes Road, Houston, Texas
77077;
- Bay Place Apartments (193 units), 16457 El Camino Real,
Houston, Texas 77062; and
- Sierra Pines (804 units), 6403 Sierra Blanca, Houston, Texas
77083.
The Reorganized Debtors will continue to operate the Apartment
Complexes after the effective date.
A copy of the Joint Plan of Reorganization is available for a fee
at: http://www.researcharchives.com/bin/download?id=060724045617
About AH-DH Apartments
Headquartered in Plano, Texas, AH-DH Apartments, Ltd., owns 16
apartment complexes. The company and three of its affiliates
filed for chapter 11 protection on Mar. 22, 2006 (Bank. E.D. Tex.
Case No. 06-40355). J. Mark Chevallier, Esq., at McGuire Craddock
& Strother, P.C., represents the Debtors. When the Debtors filed
for protection from their creditors, they estimated assets and
debts between $50 million and $100 million.
DH Holdings Limited Partnership and DH Holdings GP, Inc., filed
for chapter 11 protection on Apr. 8, 2006 (Bankr. E.D. Tex. Case
Nos. 06-40479 and 06-40480). Another affiliate, DB Holdings, LLC,
filed for chapter 11 protection on Apr. 10, 2006 (Bankr. E.D. Tex.
Case No. 06-40484). The Debtors' chapter 11 cases are jointly
administered under Case No. 06-40355.
AH-DH APARTMENTS: Cornerstone Seeks Exclusive Period Termination
----------------------------------------------------------------
Cornerstone Capital Consulting, Inc., asks the U.S. Bankruptcy
Court for the Eastern District of Texas in Sherman to terminate
the exclusive plan-filing period of AH-DH Apartments, Ltd., and
its debtor-affiliates.
Cornerstone discloses that it is a party in interest in the
Debtors cases by virtue of the assignment to Cornerstone of at
least one scheduled unsecured claim in each of the Debtors cases.
Cornerstone wants to terminate the Debtors' exclusivity so that it
can submit a plan of reorganization and disclosure statement that
creditors may consider along with the Debtors' Joint Plan of
Reorganization that was filed on July 3, 2006.
Cameron D. Gray, Esq., at the Law Office of Cameron D. Gray, tells
the Court that the Debtors have failed to file a Disclosure
Statement explaining their Plan or set any deadline or hearings
with respect to that Plan.
According to Mr. Gray, the Debtors' Plan relies on a proposed
capital infusion from Vintage Capital Group, LLC, but neglects to
give any information regarding Vintage's ability to fund the
infusion. In addition, Mr. Gray points out that the Plan does not
disclose how payments to unsecured creditors will be accomplished
and fails to give any detail regarding the reorganization of
debtor Shadow Creek Apartments, Ltd.
Cornerstone also pointed to Citigroup Global Markets Realty
Corporation's recent request to lift the automatic stay so it can
foreclose on its collateral. Citigroup has complained that the
Debtors' Plan is not in the process of confirmation but is only a
place holder, seeking to hold creditors at bay.
Headquartered in Plano, Texas, AH-DH Apartments, Ltd., owns 16
apartment complexes. The company and three of its affiliates
filed for chapter 11 protection on Mar. 22, 2006 (Bank. E.D. Tex.
Case No. 06-40355). J. Mark Chevallier, Esq., at McGuire Craddock
& Strother, P.C., represents the Debtors. When the Debtors filed
for protection from their creditors, they estimated assets and
debts between $50 million and $100 million.
DH Holdings Limited Partnership and DH Holdings GP, Inc., filed
for chapter 11 protection on Apr. 8, 2006 (Bankr. E.D. Tex. Case
Nos. 06-40479 and 06-40480). Another affiliate, DB Holdings, LLC,
filed for chapter 11 protection on Apr. 10, 2006 (Bankr. E.D. Tex.
Case No. 06-40484). The Debtors' chapter 11 cases are jointly
administered under Case No. 06-40355.
AMCAST INDUSTRIAL: GAMCO Insists on Right to Buy Property for $1
----------------------------------------------------------------
GAMCO Components, LLC, asks the U.S. Bankruptcy Court for the
Southern District of Indiana to compel debtor Amcast Industrial
Corporation to agree to sell certain of its real property for a
nominal price of $1.
Amcast and GAMCO are parties to a lease agreement, dated August
2004, related to GAMCO's purchase of certain assets from Amcast.
Pursuant to the lease agreement, Amcast leased to GAMCO a parcel
of land located on the southeast side of Hamilton Road in the City
of Cedarburg, Ozaukee County in Wisconsin.
The Cedarburg property was leased to GAMCO for $1 per year plus
the direct payment of tax, utility and insurance obligations and a
$50,000 security deposit held in escrow.
Under their lease agreement, GAMCO has the option to purchase the
Cedarburg property for a nominal price of $1. The Debtors
informed GAMCO in February 2006 that they are terminating the
lease effective August 22, 2006.
In response, GAMCO exercised its option to purchase the property
and made the required $1 payment. Because of this payment, GAMCO
says the Debtors are obliged to turn over title of the property.
Lisa M. Yerrace, Esg., at Calfee, Halter & Griswold LLP, tells the
Court that the purchase option is one of GAMCO's rights
appurtenant to the lease and is enforceable under applicable non-
bankruptcy law.
GAMCO also wants the Court to direct Wells Fargo, as Escrow Agent,
to return the $50,000 security deposit in full. Ms. Yerrace
explains that the security deposit should be returned to GAMCO
because the Debtors have made no claims against the deposit and no
claims for liability covered by the escrow exist.
About Amcast Industrial
Headquartered in Fremont, Indiana, Amcast Industrial Corporation,
manufactures and distributes technology-intensive metal products
to end-users and suppliers in the automotive and plumbing
industry. The Company and four debtor-affiliates filed for
chapter 11 protection on Nov. 30, 2004. The U.S. Bankruptcy Court
for the Southern District of Ohio confirmed the Debtors' Third
Amended Joint Plan of Reorganization on July 29, 2005. The
Debtors emerged from bankruptcy on Aug. 4, 2005.
Amcast Industrial Corporation and Amcast Automotive of Indiana,
Inc., filed for chapter 11 protection a second time on Dec. 1,
2005 (Bankr. S.D. Ind. Case No. 05-33322). David H. Kleiman,
Esq., and James P. Moloy, Esq., at Dann Pecar Newman & Kleiman,
P.C., represent the Debtors in their restructuring efforts. Henry
A. Efromson, Esq., and Ben T. Caughey, Esq., at Ice Miller LLP,
represent the Official Committee of Unsecured Creditors. Kevin I.
Dowd at Berkeley Square Group LLC serves as Amcast's financial
advisor. The Creditors' Committee receives financial advice from
Thomas E. Hill at Alvarez & Marsal, LLC. When the Debtor and its
affiliate filed for protection from their creditors, they listed
total assets of $97,780,231 and total liabilities of $100,620,855.
AMCAST INDUSTRIAL: Court Approves Asset Sale to BIDITUP and H&B
---------------------------------------------------------------
The Honorable Frank J. Otte of the U.S. Bankruptcy Court for the
Southern District of Indiana in Indianapolis approved the sale of
Amcast Industrial Corporation and Amcast Automotive of Indiana,
Inc.'s Fremont and Gas City operations to BIDITUP Worldwide
Auctions, Inc., and Hanning & Bean Enterprises.
The Fremont and Gas City operations are the two remaining
divisions of Amcast Automotive. The Court had previously approved
the sale of Amcast Automotive's Casting Technology Company to
Monomoy Capital Partners, LP. The Debtors primarily used the
facilities to manufacture aluminum wheels for General Motors Corp.
and other customers.
The combined consideration to be paid for all of the assets under
the sale is $8.25 million. BIDITUP will pay $6 million to acquire
all of the equipment located at the Fremont and Gas City
facilities while Hanning & Bean will pay $2,250,000 to purchase
all real estate comprising the facilities.
Proceeds from the sale will be distributed to the NexBank, SSB,
fka Heritage Bank, SSB, or other secured lenders with NexBank's
consent. NexBank asserts a security interest in and liens upon
substantially all of the Debtors' assets on account of prepetition
loans totaling approximately $82.6 million.
The only contract to be assumed under the purchase agreement with
Hanning & Bean is the Debtors' Industrial Development Project
Lease with Gas City. The amount of cure cost owed to the City of
Gas City Department of Redevelopment under the lease is fixed at
$400,000.
The Debtors reserve their rights under the Gas City Lease to
exercise the purchase option and sell Hanning & Bean a fee simple
interest in the Leased Premises in lieu of a lease assignment.
All other taxes owed to any entity on account of real or personal
property at the leased premises will be treated as a general
unsecured claim.
About Amcast Industrial
Headquartered in Fremont, Indiana, Amcast Industrial Corporation,
manufactures and distributes technology-intensive metal products
to end-users and suppliers in the automotive and plumbing
industry. The Company and four debtor-affiliates filed for
chapter 11 protection on Nov. 30, 2004. The U.S. Bankruptcy Court
for the Southern District of Ohio confirmed the Debtors' Third
Amended Joint Plan of Reorganization on July 29, 2005. The
Debtors emerged from bankruptcy on Aug. 4, 2005.
Amcast Industrial Corporation and Amcast Automotive of Indiana,
Inc., filed for chapter 11 protection a second time on Dec. 1,
2005 (Bankr. S.D. Ind. Case No. 05-33322). David H. Kleiman,
Esq., and James P. Moloy, Esq., at Dann Pecar Newman & Kleiman,
P.C., represent the Debtors in their restructuring efforts. Henry
A. Efromson, Esq., and Ben T. Caughey, Esq., at Ice Miller LLP,
represent the Official Committee of Unsecured Creditors. Kevin I.
Dowd at Berkeley Square Group LLC serves as Amcast's financial
advisor. The Creditors' Committee receives financial advice from
Thomas E. Hill at Alvarez & Marsal, LLC. When the Debtor and its
affiliate filed for protection from their creditors, they listed
total assets of $97,780,231 and total liabilities of $100,620,855.
ASARCO LLC: Gerald Metals Wants Court to Dismiss Complaint
----------------------------------------------------------
Gerald Metals, Inc., asks the U.S. Bankruptcy Court for the
Southern District of Texas in Corpus Christi to:
(a) dismiss ASARCO LLC's Complaint, with prejudice; and
(b) award its costs in defending the action, disbursements and
attorneys' fees.
Daniel I. Morenoff, Esq., at Hughes Luce LLP, in Dallas, Texas,
contends that ASARCO LLC's Amended Complaint fails to allege a
claim on which relief can be granted.
ASARCO complained that it suffered harm as a result of its
reliance on Gerald Metals, Inc.'s misrepresentations. ASARCO
asserted that under Section 542(b) of the Bankruptcy Code, Gerald
is required to deliver:
-- $7,166,365, representing Gerald's prepetition default; and
-- between 352,460 and 534,718 pounds of metal that ASARCO
overshipped to Gerald. The Overshipped Metal is worth
between approximately $1,220,000 and $1,850,000.
ASARCO alleged that Gerald has converted property of the Debtors'
estate inasmuch as the Gerald Debt and the Overshipped Metal are
property of the Debtor's estate.
Mr. Morenoff argues that ASARCO's allegations of
misrepresentation, turnover of property, and conversion fail to
state a claim for relief that is separate and distinct from
ASARCO's complaint for breach of contract.
Mr. Morenoff maintains that the alleged money debt cannot be the
subject of conversion.
Moreover, Mr. Morenoff contends, ASARCO's claims are barred, in
whole or in part:
-- by the doctrines of res judicata and collateral estoppel,
-- by the doctrine of merger,
-- by the doctrines of waiver, ratification and estoppel,
-- by the doctrine of the statute of frauds,
-- by the doctrine of unclean hands,
-- on the basis of breach of contract,
-- on the basis of novation, and
-- by the doctrine of judicial estoppel.
Gerald further asserts that:
-- ASARCO's claims are subject to setoff and recoupment by
amounts due from ASARCO to Gerald;
-- ASARCO has failed to plead fraud with sufficient
particularity pursuant to Rule 9 of the Federal Rules of
Civil Procedure;
-- ASARCO has failed to mitigate its alleged damages;
-- any claimed reliance by ASARCO on statements allegedly made
by Gerald or persons acting on its behalf was not
justified;
-- ASARCO is equitably estopped from asserting its claims; and
-- ASARCO fails to allege scienter sufficiently as to its
claim for misrepresentation.
Gerald reserves all of its rights, immunities and defenses
contained in the Uniform Commercial Code and in the Bankruptcy
Code, to the extent they apply to ASARCO's Complaint.
ASARCO is not entitled to attorneys' fees and expenses, Mr.
Morenoff says.
ASARCO's Initial Disclosure
James R. Prince, Esq., at Baker Botts LLP, in Dallas, Texas,
informs the Court that ASARCO may use seven individuals likely to
have information in support of its claims:
1. Gary Miller, ASARCO's vice president, commercial,
2. James Watt, ASARCO's director of raw materials,
3. Christopher Strand, Refined Copper Products' manager,
4. Rob Kastelic, ASARCO's assistant treasurer,
5. Antonio Hernandez, ASARCO's director of metals accounting,
6. Oscar Gonzalez, ASARCO's controller, and
7. Genaro Guerrero, ASARCO's treasurer, vice president of
finance and chief financial officer.
According to Mr. Prince, ASARCO may use these documents to
support its claims:
1. Contracts and related documents;
2. Preliminary and final invoices related to contracts and
agreements between ASARCO and Gerald;
3. Assay reports and related documents;
4. Documents related to shipping and transportation,
including but not limited to, bills of lading;
5. Communications between ASARCO and Gerald; and
6. Miscellaneous documents.
ASARCO is seeking damages of at least $8,386,365. Mr. Prince
notes that the damages have been computed based on the sum of:
-- finalized invoices for goods and services for which ASARCO
has not received payment from Gerald;
-- the approximately $1,500,000 Gerald owed ASARCO but
withheld as part of the October 2005 Agreement; and
-- the value of the Overshipped Metal.
Based in Tucson, Arizona, ASARCO LLC -- http://www.asarco.com/--
is an integrated copper mining, smelting and refining company.
Grupo Mexico S.A. de C.V. is ASARCO's ultimate parent. The
Company filed for chapter 11 protection on Aug. 9, 2005 (Bankr.
S.D. Tex. Case No. 05-21207). James R. Prince, Esq., Jack L.
Kinzie, Esq., and Eric A. Soderlund, Esq., at Baker Botts L.L.P.,
and Nathaniel Peter Holzer, Esq., Shelby A. Jordan, Esq., and
Harlin C. Womble, Esq., at Jordan, Hyden, Womble & Culbreth, P.C.,
represent the Debtor in its restructuring efforts. Lehman
Brothers Inc. provides the ASARCO with financial advisory services
and investment banking services. Paul M. Singer, Esq., James C.
McCarroll, Esq., and Derek J. Baker, Esq., at Reed Smith LLP give
legal advice to the Official Committee of Unsecured Creditors and
David J. Beckman at FTI Consulting, Inc., gives financial advisory
services to the Committee. When the Debtor filed for protection
from its creditors, it listed $600 million in total assets and
$1 billion in total debts.
The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525). They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd. Details about
their asbestos-driven chapter 11 filings have appeared in the
Troubled Company Reporter since Apr. 18, 2005.
Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No.
05-21346) also filed for chapter 11 protection, and ASARCO has
asked that the three subsidiary cases be jointly administered
with its chapter 11 case. On Oct. 24, 2005, Encycle/Texas' case
was converted to a Chapter 7 liquidation proceeding. The Court
appointed Michael Boudloche as Encycle/Texas, Inc.'s Chapter 7
Trustee. Michael B. Schmidt, Esq., and John Vardeman, Esq., at
Law Offices of Michael B. Schmidt represent the Chapter 7
Trustee. (ASARCO Bankruptcy News, Issue No. 25; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
AVENTINE RENEWABLE: Tender Offer Completion Cues S&P to Up Rating
-----------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Aventine Renewable Energy Holdings Inc. to 'B+' from
'B-' after the company's successful completion of a tender offer
for all of its $160 million senior secured notes due in 2011.
Of the $160 million notes outstanding, $155 million were tendered
and accepted. The outlook is stable.
Aventine funded the tender from the $261.9 million of new proceeds
from its June 29, 2006, IPO. The company sold 6.4 million shares
of common stock for a gross price of $43/share.
"The decrease in leverage has dramatically improved Aventine's
ability to service debt going forward but the rating remains
restricted by the company's ability to incur additional amounts of
debt without restrictions," said Standard & Poor's credit analyst
Elif Acar.
The stable outlook on Aventine is supported by low debt levels and
currently favorable ethanol industry conditions.
AVENUE FINANCIAL: Shareholders Approves Debt Restructuring Plan
---------------------------------------------------------------
Avenue Financial Corp.'s shareholders approved the Management
Debt Restructuring Plan at an annual and special meeting held on
June 28, 2006.
The company entered into an agreement dated May 24, 2006, with
Avenue Global Administrators Inc., its inactive wholly-owned
subsidiary, pursuant to which AGA has agreed to assume
$1.15 million of the liability for the accrued but unpaid
management salaries to certain officers of Avenue and, as
consideration therefore, Avenue will owe AGA an equivalent amount
of money.
AGA will then subscribe for 23 million common shares of Avenue
at $0.05 per share in an amount equal to the amount of the
management salaries owed to it by Avenue, thereby eliminating
the debt owed by Avenue to AGA.
The Officers have agreed to contemporaneously waive a further
$250,000 in accrued but unpaid management salaries owing by
Avenue and purchase all of the issued and outstanding common
shares of AGA from Avenue at their fair market value, which the
parties have agreed because there are no other assets or
liabilities, for the nominal amount of $1. Upon completion of the
transaction, AGA will remain liable for the unpaid management
salaries to the Officers.
After the issuance of the Common Shares under the Plan, Robin
Ross, Chairman and CEO of Avenue, and Stephen Burns, Vice
Chairman of Avenue, will collectively own, directly and
indirectly, 26,053,365 Common Shares of Avenue. The Common
Shares issued under this transaction will have a four month
regulatory hold.
Completion of this transaction is subject to final TSX Venture
Exchange acceptance.
About Avenue Financial
Headquartered in Ontario, Canada, Avenue Financial Corporation
(TSX: AFC) -- http://www.avenuefinancialcorp.com/-- designs and
develops investment products which are sold only by registered
brokers and dealers for investors and select institutions.
At Dec. 31, 2005, the company's balance sheet showed a
stockholders' deficit of CDN$2,788,226 compared to a CDN$3,416,837
deficit at Dec. 31, 2004.
BETH ISRAEL: Wants to Hire Kaufman Borgeest as Healthcare Counsel
-----------------------------------------------------------------
Beth Israel Hospital Association of Passaic asks the United States
Bankruptcy Court for the District of New Jersey for authority to
employ Kaufman, Borgeest & Ryan, LLP, as its special healthcare
counsel.
Kaufman Borgeest will provide advice and guidance to the Debtor
regarding its obligations to comply with all applicable state and
federal healthcare laws.
Margaret J. Davino, Esq., of counsel to Kaufman Borgeest, tells
the Court that she will bill $310 per hour for this engagement.
Ms. Davino discloses that Carol Doty, Esq., an associate at the
firm, will also be rendering services and bills $230 per hour.
Ms. Davino assures the Court that the Firm is "disinterested" as
that term is defined in Section 101(14) of the Bankruptcy Code.
Ms. Davino can be reached at:
Margaret Davino, Esq.
Kaufman Borgeest & Ryan LLP
99 Park Avenue, 19th Floor
New York City 10016
Tel: (212) 980-9600
Fax: (212) 980-9291
http://www.kbrlaw.com
About Beth Israel
Headquartered in Passaic, New Jersey, Beth Israel Hospital
Association of Passaic, dba PBI Regional Medical Center --
http://www.pbih.org/-- is a 264-bed, non-profit acute care
hospital located in the City of Passaic, New Jersey. The Medical
Center represents the consolidation of two significant hospitals,
namely Passaic Beth Israel Hospital and the General Hospital
Center of Passaic, and provides medical and health services
including comprehensive cardiac services program, bypass surgery,
electrophysiology, off pump surgery, and others.
The Company filed for chapter 11 protection on July 10, 2006
(Bankr. D. N.J. Case No. 06-16186). Mark J. Politan, Esq., and
Michael D. Sirota, Esq., at Cole, Schotz, Meisel, Forman &
Leonard, P.A., represent the Debtor in its restructuring efforts.
When the Debtor filed for protection from its creditors, it
estimated assets and debts between $50 million and $100 million.
BIO-KEY INT'L: Restates First Quarter 2006 Financial Statements
---------------------------------------------------------------
BIO-key International, Inc., delivered its amended financial
statements on Form 10-QSB/A for the first quarter ended March 31,
2006, to the Securities and Exchange Commission on July 18, 2006.
The amended quarterly report restates the Company's financial
statements and management's Controls and Procedures and clarifies
the Company's Defaults Upon Senior Securities.
Restated Financials
For the three months ended March 31, 2006, the Company incurred a
$3.8 million net loss on $3.1 million of net revenues, compared to
a $602,503 net loss on $3.9 million of net revenues in 2005.
At March 31, 2006, the Company's balance sheet showed
$24.6 million in total assets and $21.7 million in total
liabilities.
The Company's March 31 balance sheet also showed strained
liquidity with $8.1 million in total current assets available to
pay $17.8 million in total current liabilities coming due within
the next 12 months.
Default
The Company says it expects to make interest payments or issue
registered shares in lieu of interest payments on a monthly basis.
In January 2006, the Company failed to make timely payment of
interest due on the 2004 and 2005 convertible notes.
Under the provisions of the 2004 and 2005 subordinated convertible
notes, $181,000 of interest was due by January 6, 2006. The
Company also failed to make the required payments or issue shares
in the amount of $30,000, $26,000, $131,000, $26,000, $27,000, and
$123,000 beginning from the February to July monthly payments with
respect to the subordinated notes, respectively. The failure to
make the required monthly payments caused the subordinated debt to
default and the interest rate was increased by an additional 2%
per annum. This additional interest expense amounted to
approximately $9,000, during the months from January to June,
respectively.
On June 9, 2006, the Company issued registered shares to certain
holders of the September 2004 Convertible notes in lieu of
$123,365 in back interest expense and an additional $469 was paid
to certain holders for back interest expense. As of June 16, 2006
the company was no longer in arrears for the required interest
payments as related to the 2004 subordinated convertible notes.
The 2005 subordinated notes have also been in default since
January 2006 and have been accruing default interest as well. As
of July 16, 2006 total interest in arrears related to subordinated
notes amounted to $273,000.
The company made the required payments to the 2004 and 2005 Senior
Debt holder, Laurus Master Fund Ltd. However, due to the non-
payment of subordinated interest, the Company incurred, in
accordance with the cross-default provisions of the senior debt
agreements, an additional 1.5% per month default interest penalty
relating to the senior debt. This resulted in additional interest
expense of $86,000, $78,000, $86,000, $83,000, $86,000, and
$83,000 beginning from January to June, respectively. As of July
16, 2006 total interest in arrears related to the Senior debt
amounted to $502,000.
As of July 16, 2006, total interest in arrears for all of the
Company's convertible debt amounted to $775,000.
Moreover, since the registration statement related to the 2005
convertible notes was not declared effective by April 30, 2006,
the Company was required to pay liquidating damages per the
registration rights agreement with the 2005 subordinated debt
holders by May 30, 2006. The Company was unable to make this
payment nor has that registration statement been declared
effective. At July 16, 2006, the total penalty in arrears
amounted to $945,000.
A full-text copy of the Company's Amended Quarterly Report is
available for free at http://researcharchives.com/t/s?e50
Going Concern Doubt
DS&B, Ltd., in Minneapolis Minnesota, raised substantial doubt
about BIO-key International, Inc.'s ability to continue as a going
concern after auditing the Company's financial statements for the
years ended Dec. 31, 2005, and 2004. The auditor pointed to the
company's losses from operations and working capital deficit.
About BIO-Key
BIO-key International, Inc., develops and markets identification
biometric software in the United States. The software provides
identification technology that scans fingerprints and identifies
a person in databases.
BLACK PRESS: S&P Rates CDN$367.4 Million Bank Loan Facility at B+
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' long-term
corporate credit rating to Victoria, British Columbia-based Black
Press Ltd.
At the same time, Standard & Poor's assigned its 'B+' rating, with
a recovery rating of '2', to the company's CDN$367.4 million bank
loan facility, indicating that the asset values provide lenders
with the expectation of substantial recovery of principal (80%-
100%) in a payment default scenario. The outlook is stable.
The ratings are based on Standard & Poor's analysis of Black
Press, a leading western Canadian publisher of community
newspapers, and its acquisition of Ohio-based Akron Beacon Journal
(Beacon) for $165 million from The McClatchy Co. (BBB/Stable/--).
The purchase price represents a 10.2x EBITDA multiple for the 12
months ended May 31, 2006. The transaction will be financed with
debt and is expected to close within the next few weeks.
Proceeds from the new term loans will be used to fund the
acquisition as well as refinance the company's existing debt.
"The ratings on Black Press reflect the size of the Beacon
acquisition in relation to Black Press with pro forma revenues
increasing 43% year-over-year, high pro forma leverage, lack of
revenue diversification outside the newspaper industry, and
significant annual cash outflow required to support the company's
Hawaiian newspaper operation," said Standard & Poor's credit
analyst Lori Harris.
These factors are partially offset by Black Press':
* solid market position within several of its regions with pre-
acquisition circulation of about 1.6 billion;
* good brand equity; and
* management's successful track record of integrating acquired
assets.
Although Black Press participates in the challenging newspaper
industry, the company is somewhat insulated against economic
factors as a good portion of its business is concentrated in the
community newspaper segment. This segment is less reliant on
customer subscriptions and national advertising revenues, which
tend to be more volatile than local advertisers.
The stable outlook reflects the expectation:
* that Black Press will maintain its leading position in its
core markets;
* that the Beacon will be successfully integrated; and
* that credit measures will remain in line with the ratings in
the medium term.
The ratings could be raised if the company meaningfully improves
its financial profile and strengthens its business risk profile by
turning around its U.S. operations. The ratings could be lowered
if Black Press fails to meet expectations, with the Beacon proving
to be more challenging than expected, resulting in a decline in
free cash flow and weakening of credit measures.
Compounding these problems and adding to downward pressure on the
ratings would be the ongoing weakness of the Hawaiian operation,
which could begin to absorb a higher portion of free cash flow,
resulting in a decrease in funds available for debt servicing.
BROOK MAYS: Section 341(a) Meeting Scheduled for August 11
----------------------------------------------------------
The U.S. Trustee for Region 6 will convene a meeting of Brook Mays
Music Company's creditors at 10:00 a.m., on August 11, 2006, at
Room 976, 1100 Commerce Street in Dallas, Texas. This is the
first meeting of creditors required under Section 341(a) of the
Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
Headquartered in Dallas, Texas, Brook Mays Music Company --
http://www.brookmays.com/-- is a full-line musical instrument
retailer in the U.S. It offers a broad range of educational
services, complete instrument repair and overhaul facilities and
operates a rental program for musical instruments. The Company
filed for chapter 11 protection on July 11, 2006 (Bankr. N.D. Tex.
Case No. 06-32816). Marcus Alan Helt, Esq., and Michael S.
Haynes, Esq., at Gardere Wynne Sewell LLP, represent the Debtor.
The Recovery Group, Inc., serves as the Debtor's financial advisor
while Houlihan Lokey Howard and Zukin Capital, Inc., acts as
restructuring advisor. The Debtor has selected Kurtzman Carson
Consultants LLC as its Notice, Claims and Balloting Agent.
When it filed for bankruptcy, the Debtor estimated its assets
at $10 million to $50 million and its debts at $50 million to
$100 million.
BUFFALO COAL: Carl DelSignore Wants Consolidation Motion Denied
---------------------------------------------------------------
The Carl DelSignore Family Trust asks the U.S. Bankruptcy Court
for the Northern District of West Virginia to deny the substantive
consolidation request of the Official Committee of Unsecured
Creditors appointed in Buffalo Coal Company, Inc.'s chapter 11
cases.
As reported in the Troubled Company Reporter on July 13, 2006, the
Debtor's Committee asked the Court to substantively consolidate
the estates of Buffalo Coal and United Energy Coal, Inc., pursuant
to Section 105(a) of the Bankruptcy Code and Bankruptcy Rule 1015.
The Committee wants the two cases to be consolidated under Buffalo
Coal's chapter 11 case.
The Trust tells the Court that it does not dispute the allegations
that Gerald Ramsburg and Charles Howdershelt are the sole officers
and directors of Buffalo Coal and that in their individual
capacities, own United Energy.
The Trust however disputes the Committee's statements that:
* the Debtors operated as one company with two divisions;
* while the Debtors kept records of intercompany transfers and
related intercompany debts, reconciliation and repayment was
not adhered to nor were the debts memorialized by contracts,
promissory notes or other formal writings evidencing the
debt; and
* the Debtors share assets like equipment without entering
into intercompany lease agreements.
The Trust contends that based on the testimony of the Debtors'
officers at their respective Section 341(a) meetings, the Debtors
operated as separate and distinct companies. There were also
intercompany transactions although obligations due and owing to
each company were not paid, the Trust relates. The Trust further
says that the Debtors also kept records of the equipment shared.
The Trust further argues that the assertion that the Debtors
intend to reorganize is false since it is clear that they intend
to liquidate their assets and not continue as viable
organizations.
The Trust concludes that while substantive consolidation may
result in administrative ease, it would certainly not result in
equitable treatment of the Trust's claim. Doing so would mean the
creditors of United Energy would be able to share in the assets of
Buffalo Coal, which clearly, is prejudicial to the Trust.
About United Energy
Headquartered in Oakland, Maryland, United Energy Coal, Inc.,
filed for chapter 11 protection on May 31, 2006 (Bankr. N.D. W.Va.
Case No. 06-00453). David A. Hoyer, Esq., at Hoyer, Hoyer &
Smith, PLLC, represents the Debtor. Court documents do not show
who United Energy's Official Committee of Unsecured Creditors
retained as counsel. When the Debtor filed for protection from
its creditors, it listed total assets of $103,575,293 and total
debts of total debts of $94,016,306.
About Buffalo Coal
Headquartered in Oakland, Maryland, Buffalo Coal Company, Inc., is
engaged in coal mining and processing services. The company filed
for chapter 11 protection on May 5, 2006 (Bankr. N.D. W.Va. Case
No. 06-00366). David A Hoyer, Esq., at Hoyer, Hoyer & Smith,
PLLC, represents the Debtor in its restructuring efforts. Thorp
Reed and Armstrong, LLP, represents Buffalo Coal's Official
Committee of Unsecured Creditors. When the Debtor filed for
protection from its creditors, it listed total assets of
$119,323,183 and total debts of $105,887,321.
CALIFORNIA STEEL: Earns $36.3 Mil. in 2nd Quarter Ended June 30
---------------------------------------------------------------
California Steel Industries Inc. reported net income of
$36.3 million from sales of $349.1 million for the second quarter
ended June 30, 2006.
The $36.3 million second quarter 2006 net income is higher than
second quarter 2005's net income of $9.7 million, and slightly
higher than first quarter 2006's $30.3 million. Year-to-date,
sales revenues total $667.1 million, compared with $645.9 million
in 2005.
"We are very pleased with our results in the first semester of
2006, one of the best in our company's history," said Masakazu
Kurushima, California Steel's president and chief executive
officer. "Demand for steel products has strengthened since the
same period last year, especially pipe products, and this is
reflected in these outstanding results," he continued.
The balance under the company's revolving credit agreement was
zero as of June 30, 2006, with availability of over $108.7
million. The company has a cash balance as of June 30, 2006 of
$161.5 million.
Headquartered in Fontana, California, California Steel Industries
produces flat rolled steel products in the western United States
based on tonnage billed, with a broad range of products, including
hot rolled, cold rolled, and galvanized sheet and electric
resistant welded pipe. The company has about 1,000 employees.
* * *
California Steel Industries, Inc.'s 6-1/8% Series B Senior Notes
due 2014 carry Moody's Investor Service's Ba2 rating and Standard
and Poor's BB- rating.
CALPINE CORP: Wants to Sell TransCanada Transpo Service Contract
----------------------------------------------------------------
Rumford Power Associates Limited Partnership, debtor and debtor-
in-possession, and Calpine Corp. and its debtor-affiliates ask the
U.S. Bankruptcy Court for the Southern District of New York to
approve the sale of substantially all of its assets, free and
clear of all liens.
Rumford Power Associates Limited owned certain real property in
Rumford, Maine. Rumford Power is also a party to certain Leases
related to a gas-fired combined cycle electric generating
facility. Under the Leases, Rumford Power leased its real
property to PMCC Calpine New England Investment, LLC, who owned
the Power Plant, and subleased the same property and leased the
Power Plant back to Rumford Power.
Rumford Power attempted to reject the Leases. On June 8, 2006,
the Court approved the Transition Agreement between Rumford Power
Associates Limited, James A. Goodman, the receiver of PMCC, and
the U.S. Bank National Association, as trustee.
Pursuant to the Transition Agreement, Rumford Power transferred
and surrendered possession of its rights under certain contracts.
The contracts not listed in the Transition Agreement remained the
property of Rumford Power.
Among the contracts not included in the Transition Agreement was a
Firm Transportation Service Contract, dated Jan. 7, 2000, between
Rumford Power and TransCanada Pipelines Limited. Under the FT
Contract, which expires at the end of October 2010, TransCanada
transports 46,403 gigajoules of natural gas daily.
Since Rumford Power is no longer operating the Rumford Power
Plant, it has no further need for the firm transportation capacity
from TransCanada, Bennett L. Spiegel, Esq., at Kirkland & Ellis
LLP, in New York, contends. The FT Contract is a drain on Rumford
Power's estate, Mr. Spiegel adds, as Rumford Power incurs
approximately CDN$521,000 per month of firm demand charges under
the FT Contract.
However, while Rumford Power no longer requires natural gas
transportation from TransCanada, third parties may still be able
to derive significant value from the firm transportation capacity
provided under the FT Contract, Mr. Spiegel says.
After examining all of their alternatives, the Debtors concluded
that a prompt sale of the FT Contract is in the best interests of
Rumford Power's creditors and estate, and will maximize the value
received for the Assets.
Before the consummation of an Asset Purchase Agreement and the
Sale of the FT Contract, Rumford Power intends to assume the FT
Contract and pay its cure amount. The assumption and assignment
of the FT Contract is a precondition to the effectiveness of the
APA, Mr. Spiegel says.
The APA provides that:
(a) Rumford Power will assign, transfer and convey to the
Buyer, free and clear of all Liens, its rights, benefits
and privileges under the FT Contract;
(b) Buyer will pay the purchase price, still to be determined
by the Debtors, at Closing Date by cashier's check,
certified check or wire transfer; and
(c) the Sale Assets excludes:
* assets of any kind other than the FT Contract,
including trade names, trademarks, service marks or
logos owned by Rumford Power or any of its
affiliates;
* all trade credits and all accounts, deposits,
collateral, credit support, instruments and general
intangibles attributable to the FT Contract to any
period before the Closing Date;
* all of Rumford Power's claims and causes of action
arising under the FT Contract in the period before
the Closing Date;
* all of Rumford Power's rights and interests under any
agreement of insurance, indemnity, bond or guaranty
arising from acts occurring before the Closing Date
or attributable to the FT Contract or any Excluded
Assets;
* all proceeds, income or revenues attributable to the
FT Contract for any period before the Closing Date;
* any cumulative variances as of the Closing Date and
associated rights to nominate Payback Quantities and
to receive other payments for the cumulative
variances; and
* any other assets, rights, demands, claims, credits,
allowances, rebates or causes of action of Rumford
Power or any of its affiliates except for the FT
Contract.
A full-text copy of the APA is available for free at:
http://ResearchArchives.com/t/s?e59
Rumford Power sent solicitations of interest to 68 third parties.
To participate in the bidding process and be deemed a "Qualifying
Bidder," a potential bidder must deliver to Rumford Power, the
Official Committee of Unsecured Creditors, the Official Committee
of Equity Security Holders and the Unofficial Committee of Second
Lien Debtholders, a written offer to be deemed a "Qualifying Bid,"
no later than 5:00 p.m., on Aug. 10, 2006.
The written offer, among other things, must state the Bidder's
offer to purchase the FT Contract, and must state that the Bidder
is financially capable of consummating the transactions
contemplated in the APA or in a modified APA.
A Bidder's offer must be is irrevocable until the Closing Deadline
if the Bidder is the Prevailing Bidder or the Back-up Bidder.
A Bidder must be willing to consummate and fund the proposed sale
before 4:00 p.m., on Aug. 21, 2006, and to commence operations
under the FT Contract on Sept. 1, 2006, provided that the Bidder's
offer should also include a bid based on an Oct. 1, 2006,
alternative Operations Commencement Date for purposes of providing
a Back-up Bid.
Rumford Power will also consider written offers Qualifying Partial
Bids at the Auction. Qualifying Partial Bidders will be allowed
to participate as Qualifying Bidders in the Auction.
Qualifying Partial Bids will be considered either singly or in
combination with other non-overlapping Qualifying Partial Bids so
that the combination of the Qualifying Partial Bids would amount
to the sale of substantially all of the Sale Assets.
If there are two or more Qualifying Bids or Qualifying Aggregate
Bids, Rumford Power will conduct an Auction at 10:00 a.m., on
Aug. 14, 2006, at Calpine Corporation's offices in 717 Texas Ave.,
Suite 1000, in Houston, Texas.
About Calpine Corp.
Headquartered in San Jose, California, Calpine Corporation --
http://www.calpine.com/-- supplies customers and communities with
electricity from clean, efficient, natural gas-fired and
geothermal power plants. Calpine owns, leases and operates
integrated systems of plants in 21 U.S. states and in three
Canadian provinces. Its customized products and services include
wholesale and retail electricity, gas turbine components and
services, energy management and a wide range of power plant
engineering, construction and maintenance and operational
services. The Company filed for chapter 11 protection on
Dec. 20, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-60200). Richard
M. Cieri, Esq., Matthew A. Cantor, Esq., Edward Sassower, Esq.,
and Robert G. Burns, Esq., Kirkland & Ellis LLP represent the
Debtors in their restructuring efforts. Michael S. Stamer, Esq.,
at Akin Gump Strauss Hauer & Feld LLP, represents the Official
Committee of Unsecured Creditors. As of Dec. 19, 2005, the
Debtors listed $26,628,755,663 in total assets and $22,535,577,121
in total liabilities.
CALPINE CORP: Gets Open-Ended Deadline to Decide on Leases
----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
further extended Calpine Corp. and its debtor-affiliates' time
within which they may assume or reject non-residential real
property leases until the confirmation date of each applicable
Debtor-Lessee's plan of reorganization.
As reported in the Troubled Company Reporter on April 12, 2006,
the Debtors sought an extension of 90 days to assume or reject
unexpired leases of nonresidential real properties. The Court
extended the Debtors' lease decision period until July 10, 2006.
As of June 28, 2006, the Debtors filed six omnibus assumption
motions and have rejected nine office leases and three office
subleases. However, the Debtors told the Court that due to the
complexity of their corporate structure and business operations,
they may be lessees under unidentified unexpired leases among
domestic Debtor and non-Debtor affiliates in the United States.
The Debtors explained that premature rejection of intercompany
leases may result in potential defaults under their financing
arrangements and may distract management from business planning
necessary to formulate a plan.
About Calpine Corp.
Headquartered in San Jose, California, Calpine Corporation --
http://www.calpine.com/-- supplies customers and communities with
electricity from clean, efficient, natural gas-fired and
geothermal power plants. Calpine owns, leases and operates
integrated systems of plants in 21 U.S. states and in three
Canadian provinces. Its customized products and services include
wholesale and retail electricity, gas turbine components and
services, energy management and a wide range of power plant
engineering, construction and maintenance and operational
services. The Company filed for chapter 11 protection on
Dec. 20, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-60200). Richard
M. Cieri, Esq., Matthew A. Cantor, Esq., Edward Sassower, Esq.,
and Robert G. Burns, Esq., Kirkland & Ellis LLP represent the
Debtors in their restructuring efforts. Michael S. Stamer, Esq.,
at Akin Gump Strauss Hauer & Feld LLP, represents the Official
Committee of Unsecured Creditors. As of Dec. 19, 2005, the
Debtors listed $26,628,755,663 in total assets and $22,535,577,121
in total liabilities. (Calpine Bankruptcy News, Issue No. 21;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
CATHOLIC CHURCH: Dist. Ct. Overrules Spokane Estate Dispute Order
-----------------------------------------------------------------
Judge Justin L. Quackenbush of the U.S. District Court for the
Eastern District of Washington, in a 21-page Memorandum Opinion
and Order, says the uncontroverted affidavits and records
submitted in the case made it clear for him to decide that the
Bankruptcy Court erred in granting summary judgment in favor of
the Tort Litigants Committee regarding property of the estate
dispute.
Judge Quackenbush notes that the evidence before the Bankruptcy
Court and the District Court is abundant, showing that the
individual Parishes provided the costs for the construction of
churches and schools on the subject properties either through cash
on hand or through loans they obtained, and solely paid for by the
individual Parish and its members.
The evidence shows that all costs for the operation and
maintenance of the Parish properties were and are paid for by the
individual Parish, including any stipend, maintenance, or salary
of the Parish Priests, who were assigned to the individual
Parish, Judge Quackenbush says.
The individual Parishes raise their funds through regular
contributions from individual members and those funds are retained
in accounts in the Parish's name, Judge Quackenbush relates. Each
Parish maintains and solely controls its own separate bank
account.
When the Diocese is in need of a contribution from communicants,
Judge Quackenbush finds that an individual collection or fund
drive is created for that purpose. When Parish property or a
portion is sold, the proceeds of any the sale goes to that
Parish.
Several of the affidavits submitted to the Bankruptcy Court urged
Judge Williams to consider Canon Law in making its determination,
Judge Quackenbush points out. But the Bankruptcy Court did not do
so.
Judge Quackenbush relates that he considered Canon Law in making a
determination of the parties' intent when purchasing real
property, constructing churches, and making improvements on the
real property. However, Judge Quackenbush says, the many
affidavits and documents filed do more to provide facts concerning
the parties' intent than Canon Law principles would.
The posture of the case is to be distinguished from one in which a
bona fide purchaser without notice of the interest of a
beneficiary or other claimant to the property, buys real property
from the record title older, Judge Quackenbush points out.
It would be difficult to imagine that a purchaser of Parish
property would not be on notice of the Parish's interest in the
property since a purchaser is charged with notice of the interest,
if any, of the occupant of real property, even though in the
Diocese's case, prior to the initiation of the bankruptcy, there
were no notices recorded as to the individual Parish properties
for which Spokane held title to only as a trustee, Judge
Quackenbush notes.
In Spokane's case, Judge Quackenbush says the parties represented
by the Tort Litigants Committee or the Tort Claimant Committees
are not in the posture of a bona fide purchaser nor are they in
the posture of judgment creditors of the Diocese or any individual
Parish, since none of the underlying claims have been litigated or
reduced to judgment.
"The rights of creditors to property of a debtor cannot be more
than the interest of the debtor in that property," Judge
Quackenbush points out.
In addition, the Diocese's case is different from the
circumstances of a person conducting ongoing business with the
Diocese and relying on the alleged nominal assets of the Diocese
as security for the performance of a contractual obligation or
payment.
Judge Quackenbush overruled Judge Williams' August 2005 decision
regarding the ownership of parish property and remanded the matter
to the Bankruptcy Court.
A full-text copy of Judge Quackenbush's Memorandum Opinion and
Order is available for free at http://researcharchives.com/t/s?e56
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. 65; Bankruptcy Creditors' Service, Inc., 215/945-7000)
CG MULTIFAMILY: Hires Haynes & Boone as Insurance Coverage Counsel
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Louisiana
gave CG Multifamily-New Orleans, L.P., authority to employ Haynes
and Boone, L.L.P., as its special insurance coverage counsel, nunc
pro tunc to June 12, 2006.
The Court also ordered the Debtor to pay prepetition amounts owing
to Haynes and Boone in accordance with the payment schedules set
in its Application but commencing in July 2006.
As reported in the Troubled Company Reporter on July 13, 2006, on
November 2004, the Debtor initiated litigation from those it
deemed were responsible for the water intrusion and resulting
damage on its 13-acre Saulet Apartments in New Orleans. The
Debtor sued the architect, the general contractor and four
subcontractors in Dallas County, Texas, in order to recover
repair costs brought about by the water infiltration.
In addition, the Debtor says that it also asserted a claim under
its own property insurance policies to recover the cost of
repairing damage caused by the water intrusion. The Pre-Hurricane
Insurance Claim, in which Fannie Mae also claims a security
interest, is currently under negotiation. The Debtor says that
they are represented by Haynes and Boone in all aspects of the
Pre-Hurricane Insurance Claim as insurance coverage counsel.
Ernest Martin, Jr., Esq., a partner at Haynes and Boone, tells the
Court that the Firm's professionals bill:
Professional Hourly Rate
------------ -----------
Ernest Martin, Jr., Esq. $495
Micah Skidmore, Esq. $245
Mr. Martin assures the Court that the Firm is "disinterested" as
that term is defined in Section 101(14) of the Bankruptcy Code.
About CG Multifamily
Headquartered in Charleston, South Carolina, CG Multifamily-New
Orleans, L.P. owns the Saulet Apartments in New Orleans,
Louisiana. The company filed for chapter 11 protection on
June 12, 2006 (Bankr. E.D. La. Case No. 06-10533). John M.
Landis, Esq. and Michael Q. Walshe, Jr., Esq., at Stone Pigman
Walther Wittman, LLC, represents the Debtors in its restructuring
efforts. No Official Committee of Unsecured Creditors has been
appointed in the Debtor's bankruptcy proceedings. When the Debtor
filed for protection from its creditors, it estimated assets and
debts between $50 million and $100 million.
CG MULTIFAMILY: Hires Weil Gotshal as Environmental Counsel
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Louisiana
gave CG Multifamily-New Orleans, L.P., authority to employ Weil,
Gotshal & Manges, L.L.P., as its special environmental counsel,
nunc pro tunc to June 12, 2006.
The Court also ordered the Debtor to pay prepetition amounts owing
to Weil Gotshal in accordance with the payment schedules set in
its Application but commencing in July 2006.
As reported in the Troubled Company Reporter on July 13, 2006, the
Debtor disclosed that Hurricane Katrina caused the its 13-acre
Saulet Apartments in New Orleans to experience mold problems that
required remediation. Thus, it asserted a separate insurance
claim under a separate environmental insurance policy to obtain
the necessary funds to undertake the remediation. The Debtor said
that Haynes and Boone, L.L.P. its special insurance coverage
counsel, assisted in negotiations with the Debtor's environmental
insurance carrier while Weil Gotshal has represented it in all
other aspects of the Mold Insurance Claim.
Annemargaret Connolly, Esq., a partner at Weil Gotshal, told the
Court that the Firm's professionals bill:
Professional Hourly Rate
------------ -----------
Annemargaret Connolly, Esq. $660
Connie Ericson, Esq. $505
Ms. Connolly assured the Court that the Firm is "disinterested" as
that term is defined in Section 101(14) of the Bankruptcy Code.
About CG Multifamily
Headquartered in Charleston, South Carolina, CG Multifamily-New
Orleans, L.P. owns the Saulet Apartments in New Orleans,
Louisiana. The company filed for chapter 11 protection on
June 12, 2006 (Bankr. E.D. La. Case No. 06-10533). John M.
Landis, Esq. and Michael Q. Walshe, Jr., Esq., at Stone Pigman
Walther Wittman, LLC, represents the Debtors in its restructuring
efforts. No Official Committee of Unsecured Creditors has been
appointed in the Debtor's bankruptcy proceedings. When the Debtor
filed for protection from its creditors, it estimated assets and
debts between $50 million and $100 million.
CHENIERE ENERGY: Closes $1.5 Billion Amended Credit Facility
------------------------------------------------------------
Cheniere Energy, Inc.'s wholly-owned limited partnership, Sabine
Pass LNG, L.P., closed an Amended and Restated $1.5 billion Senior
Secured Credit Facility that will mature on July 1, 2015.
The Credit Facility amends and restates Sabine Pass LNG's $822
million Senior Secured Credit Facility due February 2015 and is
available for draws to pay project costs for the construction of
Sabine Pass LNG's 1.4 Billion Cubic Feet Per Day Liquefied Natural
Gas receiving terminal. Relative to the project, Sabine Pass LNG
has awarded an Engineering, Procurement, Construction and
construction management contract to Bechtel Corporation, an
engineering, procurement and construction contract to Zachry
Construction Corporation and Diamond LNG LLC - a subsidiary of
Mitsubishi Heavy Industries Ltd., and an EPC contract to Remedial
Construction Services, L.P. The Company expects to issue each
contractor a Notice to Proceed by August 1, 2006.
The initial start-up of the Sabine Pass LNG receiving terminal,
located in Western Cameron Parish, Louisiana, is targeted for
early 2008. The Federal Energy Regulatory Commission authorized
the Company to expand its terminal's capacity and to commence
construction of the expansion, which it plans to complete in 2009.
HSBC Securities (USA) Inc. and Societe Generale Corporate &
Investment Banking, served as Joint Lead Arrangers and Joint
Bookrunners for the Credit Facility, which was syndicated to 31
financial institutions.
The Company disclosed that Sabine Pass LNG also entered into
interest rate swap agreements with HSBC Bank, NA and Societe
Generale, New York Branch, whereby Sabine Pass LNG has hedged the
LIBOR interest rate component of its drawings under the Credit
Facility up to a maximum amount of $1.25 billion.
Based in Houston, Texas, Cheniere Energy, Inc., (AMEX:LNG)
explores and produces oil. It also develops a liquefied natural
gas (LNG) receiving-terminal business. It operates a seismic
database covering about 7,000 sq. mi. It also has a 9% interest
in exploration and production affiliate Gryphon Exploration, which
explores areas targeted by a seismic data licensed from Fairfield
Industries. With proved reserves of 3,021 barrels of oil and
919.1 million cu. ft. of natural gas, it operates along the coast
of Louisiana, both onshore and in the shallow waters along the
Gulf of Mexico. In 2005, it acquired BPU LNG.
* * *
Standard & Poor's Ratings Services affirmed its 'B' corporate
credit rating on Cheniere Energy Inc. and affirmed its 'BB' rating
on the $600 million term B bank loan at Cheniere LNG Holdings LLC,
an indirectly owned, 100% subsidiary of Cheniere Energy. The
outlook is stable.
CLAIRVEST GROUP: Investigates Issue of $10 Million Loan Default
---------------------------------------------------------------
A loan of $10 million Clairvest Group Inc. made to an unrelated
party may be unrecoverable.
The loan was advanced in two tranches of $5 million in each of
December 2005 and May 2006 and was collateralized by treasury
bills deposited with a Canadian bank-owned brokerage firm. The
loan is in default and Clairvest has learned that the collateral
arrangements required for the loan have been mishandled by one or
more third parties.
Clairvest is investigating the circumstances of the default and
the mishandling of the collateral arrangements and is pursuing all
avenues to recover the funds. The circumstances surrounding this
potential loss are limited to these particular loans, and have no
impact on any of Clairvest's other assets or investments or the
partnerships that Clairvest manages.
In the event that the loan cannot be recovered, Clairvest will
realize a loss on this loan amounting to $0.52 per share.
Clairvest's book value at March 31, 2006, was $13.10 per share.
Headquartered in Toronto, Ontario, Clairvest Group Inc. (TSX:CVG)
-- http://www.clairvest.com/-- is a Canadian merchant bank that
invests its own capital, and that of third parties through
Clairvest Equity Partners Limited Partnership and Clairvest Equity
Partners III Limited Partnership, in businesses that have the
potential to generate superior returns. In addition to providing
financing, Clairvest contributes strategic expertise and execution
ability to support the growth and development of its investee
partners. Clairvest realizes value through investment returns and
the eventual disposition of its investments.
COLLINS & AIKMAN: Names James W. Wynalek as Plastics Ops President
------------------------------------------------------------------
Frank Macher, President and Chief Executive Officer of Collins &
Aikman Corporation reported the appointment of James W. Wynalek to
President - Plastics Operations.
Mr. Wynalek had been serving as Executive Vice President and Chief
Technology Officer for the North American automotive supplier. In
his new position, Mr. Wynalek will oversee all manufacturing,
purchasing, process engineering and quality issues for the
Company's Plastics Operations. Mr. Wynalek replaces Dennis
Profitt, who has left the Company to pursue other interests. Mary
Ann Wright, Executive Vice President Commercial and Program
Management will now oversee the Company's product engineering,
design and development functions in addition to her previous
responsibilities of marketing, sales, business development and
program management.
Mr. Wynalek joined Collins & Aikman in early 2006 from Dell
Computers, most recently serving as Vice President Engineering and
Quality for Dell Americas Operations. In this position he was
responsible for new product introduction, process engineering, and
test and quality operations across all North and South American
manufacturing facilities. Mr. Wynalek brings more than 28 years
of manufacturing, production design, and business development
experience to the Company.
"Jim's ability to understand the multifaceted pieces of the
manufacturing and engineering sides of our business will provide
C&A invaluable direction as we look to expedite the turnaround of
our Plastics group," Mr. Macher said. "We thank Dennis for the
contributions he made in laying the foundation for the Plastics
group turnaround and wish him well in his future endeavors."
Prior to his experience at Dell, Mr. Wynalek held senior positions
at Visteon Corporation and Ford Motor Company. Highlights of Mr.
Wynalek's extensive career in the auto sector include roles as the
VP/GM of two Visteon business units as well as executive positions
at Ford Motor Company in product design, manufacturing and
European operations. Mr. Wynalek holds a Master of Business
Administration from Eastern Michigan University and a Bachelor of
Science degree in Mechanical Engineering from the University of
Detroit.
About Collins & Aikman
Headquartered in Troy, Michigan, Collins & Aikman Corporation
-- http://www.collinsaikman.com/-- is a global leader in cockpit
modules and automotive floor and acoustic systems and is a leading
supplier of instrument panels, automotive fabric, plastic-based
trim, and convertible top systems. The Company has a workforce of
approximately 23,000 and a network of more than 100 technical
centers, sales offices and manufacturing sites in 17 countries
throughout the world. The Company and its debtor-affiliates filed
for chapter 11 protection on May 17, 2005 (Bankr. E.D. Mich. Case
No. 05-55927). Richard M. Cieri, Esq., at Kirkland & Ellis LLP,
represents C&A in its restructuring. Lazard Freres & Co., LLC,
provides the Debtor with investment banking services. Michael S.
Stammer, Esq., at Akin Gump Strauss Hauer & Feld LLP, represents
the Official Committee of Unsecured Creditors Committee. When the
Debtors filed for protection from their creditors, they listed
$3,196,700,000 in total assets and $2,856,600,000 in total debts.
CONTINENTAL AIRLINES: Earns $198 Million in 2006 Second Quarter
---------------------------------------------------------------
Continental Airlines reported second quarter 2006 net income of
$198 million, a significant improvement over its second quarter
2005 net income of $100 million. Excluding special charges,
Continental recorded net income of $208 million.
Operating income in the second quarter of 2006 was $244 million,
more than double that of the second quarter of 2005, in spite of
fuel price increases costing over $200 million and including a $60
million accrual for employee profit sharing.
The Company's balance sheet at June 30, 2006, showed $11.4 billion
in total assets and $9.1 billion in total liabilities. At June
30, the Company had $171 million in deferred income taxes, $927
million of accrued pension liability and other liabilities of $651
million. Total stockholders' equity at June 30 was $584 million.
Scheduled debt and capital lease principal payments for the third
quarter 2006 are estimated to be approximately $92 million.
Continental anticipates ending the third quarter 2006 with an
unrestricted cash and short-term investments balance of between
$2.4 and $2.5 billion.
Continental plans to take delivery of 2 Boeing 777 aircraft next
year. In addition, the Company stated that ExpressJet Holdings,
Inc.'s election to retain the 69 regional aircraft that were
withdrawn from the capacity purchase agreement will allow the
Company to right-size its regional fleet. The Company does not
expect to replace all 69 of the regional jets that were removed
from the agreement. As a result, the Company plans to grow its
mainline capacity approximately 5% and its consolidated capacity
between 3% and 4% in 2007.
In June, the Company completed a refinancing secured by most of
its spare parts inventory, which allowed it to pre-pay higher
interest rate debt of $292 million that would have been due in
December 2007. With this, and the $96 million of 2007 debt
prepayment the Company made in the first quarter, its 2007 debt
maturities are now $558 million, a reduction of $379 million.
2006 Pension Expense and Contributions
During the quarter, Continental contributed $91 million to its
pension plans and an additional $75 million in July. The Company
has contributed $172 million to the pension plans to date in 2006
and estimates that its total 2006 pension plan contributions will
total approximately $258 million.
The Company estimates its non-cash pension expense will be
approximately $185 million for the year, which includes year-to-
date settlement charges of $29 million related to lump-sum
distributions from the pilot's frozen defined benefit plan.
Similar settlement charges are expected for the remainder of 2006
but currently cannot be estimated.
Fuel Hedges
During the first quarter of 2006, Continental modified its hedging
strategy to attempt to hedge in a manner that better matches its
hedged fuel costs with passenger tickets already sold. As part of
this strategy, the Company takes into account the volume and date
of flight for the tickets sold comprising its current air traffic
liability, the amount of jet fuel that has been delivered or that
is under contract and the volume of fuel required by the Company
with respect to tickets already sold. The Company then constructs
a hedge position that is designed to better hedge fuel prices with
respect to tickets already sold, with respect to which the Company
can no longer adjust its pricing. Implicit in this strategy is
the belief that, as to tickets not yet sold, the market will be
efficient and that fare levels will adjust to keep pace with fuel
costs.
Using petroleum swap contracts and as of the date of this update,
Continental has hedged approximately 33% of its projected fuel
requirements for the third quarter with a weighted average swap
price of $73.18 per barrel, and 13% of its projected fuel
requirements for the fourth quarter, with a weighted average swap
price of $75.49 per barrel.
Tax Sharing Agreement with ExpressJet
Continental expects to record income of approximately $26 million
for the full year 2006 related to the tax sharing agreement with
ExpressJet.
A full-text copy of Continental's quarterly report is available
for free at http://researcharchives.com/t/s?e49
About Continental
Continental Airlines (NYSE: CAL) -- http://continental.com/--
serves 128 domestic and 111 international destinations and nearly
200 additional points via codeshare partner airlines. With 42,000
mainline employees, the airline has hubs serving New York,
Houston, Cleveland and Guam, and carries approximately 51 million
passengers per year.
* * *
As reported in the Troubled Company Reporter on May 29, 2006,
Standard & Poor's Ratings Services assigned its 'AAA' preliminary
rating to Continental Airlines Inc.'s (B/Negative/B-3) $190
million Class G pass-through certificates, and its 'B+'
preliminary rating to the $130 million Class B pass-through
certificates.
As reported in the Troubled Company Reporter on May 26, 2006,
Moody's Investors Service assigned Aaa rating to the Class G
Certificates and B1 rating to the Class B Certificates of
Continental Airlines, Inc.'s 2006-1 Pass Through Trusts Pass
Through Certificates, Series 2006-1.
CORPORATE AND LEISURE: Hires Michael Carmel as Bankruptcy Counsel
-----------------------------------------------------------------
Corporate and Leisure Event Production, Inc., and its debtor
affiliates obtained authority from the U.S. Bankruptcy Court for
the District of Arizona to employ Michael W. Carmel, Ltd., as
their bankruptcy counsel.
Michael Carmel is expected to:
a) give the Debtors legal advice with respect to his powers
and duties as debtors-in-possession in the continued
operation of the Debtors' business and management of their
property;
b) prepare on behalf of the Debtors the necessary
applications, answers, orders, reports and other legal
papers; and
c) perform all other legal services for the Debtors which may
be necessary.
Michael W. Carmel, Esq., tells the Court that he will bill $350
per hour for this engagement while paralegals bill $85 per hour.
Mr. Carmel discloses that a $50,000 check was deposited in his
firm's trust account from H. Edward Duham.
Mr. Carmel assures the Court that his firm represents no interest
adverse to the Debtors or their estates.
Headquartered in Tucson, Arizona, Corporate and Leisure Event
Productions, Inc., and four of its affiliates filed for chapter 11
protection on June 16, 2006 (Bankr. D. Ariz. Case No. 06-01797).
Michael W. Carmel, Esq., at Michael W. Carmel, Ltd., represents
the Debtors. When the Debtors filed for protection from their
creditors, they estimated consolidated assets and liabilities
between $10 million and $50 million.
CORPORATE & LEISURE: Court Denies Receiver's Call to Dismiss Case
-----------------------------------------------------------------
The Honorable Randolph J. Haines of the U.S. Bankruptcy Court for
the District of Arizona, denied Peter S. Davis' request to dismiss
the chapter 11 case of Corporate and Leisure Event Productions,
Inc.
Mr. Davis is the Debtor's Receiver appointed on May 8, 2006, by
the Superior Court of Arizona, Maricopa County.
Mr. Davis relates that as result of numerous complaints filed in
the Civil Action consolidated before the Superior Court of
Arizona, he was appointed as receiver for 13 entities. Two
individuals - Mr. Nozicka and William J. Galyon - are the key
figures in the Civil Actions, which involve massive fraud claims
asserted by numerous plaintiffs and total claims exceeding
$44.3 million.
Mr. Nozicka is Corporate and Leisure's president.
Mr. Davis discloses that he became aware of the fact that Mr.
Nozicka was meeting with bankruptcy counsel and on June 14, 2006,
the Receiver removed Mr. Nozicka and all of the other officers,
directors, trustees or managers of the Debtor. Mr. Nozicka and
his counsel were immediately notified of this event, and the fact
that they were no longer authorized to take any action on behalf
of the Debtor, Mr. Davis says.
However, Mr. Nozicka signed a Chapter 11 petition for the Debtor
and four other Receivership Defendants and the very same lawyer
who was previously notified about the removal of Mr. Nozicka filed
the petition despite having received a written resolution from the
Receiver.
Thus, Mr. Davis contends, the Debtor's Chapter 11 filing was
unauthorized by anyone with the power to act on behalf of the
Debtor.
Headquartered in Tucson, Arizona, Corporate and Leisure Event
Productions, Inc., and four of its affiliates filed for chapter 11
protection on June 16, 2006 (Bankr. D. Ariz. Case No. 06-01797).
Michael W. Carmel, Esq., at Michael W. Carmel, Ltd., represents
the Debtors. When the Debtors filed for protection from their
creditors, they estimated consolidated assets and liabilities
between $10 million and $50 million.
CROWN HOLDINGS: Reports $1.805 Bil. Net Sales in 2nd Quarter 2006
-----------------------------------------------------------------
Crown Holdings Inc. reported a $1,805 million net sales from
continuing operations in the second quarter ended June 30, 2006,
up 1.2% compared to the $1,783 million in the second quarter of
2005.
Commenting on the quarter, John W. Conway, Crown Holdings'
chairman and chief executive officer, stated, "We are very pleased
with the overall results achieved in the second quarter despite
the challenges presented by a volatile raw materials market. Our
price initiatives have developed according to plan and are
expected to be reflected in increased revenues over the balance of
the year and through 2007."
The company's interest expense in the second quarter was
$70 million compared to $95 million in the second quarter of 2005.
Net income from continuing operations in the second quarter was
$74 million compared to $16 million in the second quarter of 2005.
Included within net income from continuing operations, the company
recorded a net gain of $1 million reflecting a net gain of $6
million related to financial foreign exchange offset by a net loss
of $4 million related to restructuring actions and a net loss of
$1 million to expense stock options. In last year's second
quarter, the Company reported a net charge of $36 million
primarily related to a net loss from the remeasurement of foreign
currency exposures in Europe partially offset by a net gain on the
sale of assets and the reversal of tax valuation allowances.
The company's net debt increased by $52 million from March 31,
primarily as a result of $62 million from foreign currency
translation and higher raw material costs, partially offset by
increased accounts receivable securitization amounts.
Six Month Results
For the first six months of 2006, the company's net sales grew
2.4% to $3,353 million over the $3,273 million in the first six
months of 2005, up by 3.9 percent. Interest expense was $137
million compared to $189 million for the same period last year.
Net income from continuing operations of $84 million for the six
month period ended June 30, 2006, compared to a net loss of
$1 million for the same period in 2005.
In the first half of 2006, the company recorded a net charge to
net income from continuing operations of $8 million reflecting an
$11 million net loss related to restructuring projects and $4
million to expense stock options offset by a net gain of $6
million related to financial foreign exchange and a $1 million net
gain on the sale of assets.
During the first six months of 2005, the company recorded a net
charge of $53 million related to the remeasurement of foreign
currency exposures in Europe and for the early extinguishment of
debt, partially offset by a net gain on the sale of assets and a
gain related to the reversal of tax valuation allowances.
Headquartered in Philadelphia, Pennsylvania, Crown Holdings Inc.,
through its affiliated companies, supplies packaging products to
consumer marketing companies around the world.
* * *
As reported in the Troubled Company Reporter on July 24, 2006,
Moody's Investors Service affirmed Crown Holdings Inc.'s debt
ratings at Ba2. Moody's also affirmed the B2 debt and Ba3
corporate family ratings of the company's principal subsidiary
Cork and Seal Company Inc. Moody's said the ratings outlook is
stable.
Fitch assigned a 'B+' issuer default rating to Crown Holdings with
a stable outlook. The rating reflected Crown's leading market
share across its product categories; balanced revenue mix;
geographic diversification; good liquidity; modest near-term debt
maturities; volume growth in emerging markets; and focus on debt
reduction.
DANA CORP: Gets Agents' Okay to Move Challenge Period to Dec. 15
----------------------------------------------------------------
At Dana Corp. and its debtor-affiliates' request, the Receivables
Facility Agents have agreed to further extend the Challenge Period
as it relates to the Official Joint Committee of Unsecured
Creditors and the ad hoc committee of holders of notes of Dana
Corporation only under the final DIP order issued by the U.S.
Bankruptcy Court for the Southern District of New York. The
Prepetition Agent and Credit Card Issuers also agreed to extend
the Challenge Period.
The Final DIP Order provides, among other things, that any party-
in-interest can challenge the repurchase of the Receivables
Facility as well as the liens and claims of the Receivables
Facility Agents, by filing an adversary proceeding or
authorization to file an adversary proceeding by June 19, 2006.
Accordingly, the Challenge Period for the Committee and the Ad Hoc
Noteholders' Committee to contest the liens and claims under
the Receivables Facility is further extended through and including
December 15, 2006.
The Prepetition Agent, the Prepetition Lenders, the Credit Card
Issuers and the Debtors may object to the extension on or before
October 2, 2006.
On Mar. 30, 2006, Dana received final Court approval for the full
amount of its $1.45 billion DIP financing. The full facility
consists of a $750 million revolving credit facility and a $700
million term loan. The term of the DIP facility was extended to
24 months from the date of the Debtors' bankruptcy filing.
The DIP credit facility is being provided by a group of banks led
by CitiCorp North America, Inc., Bank of America, N.A., and
JPMorgan Chase Bank, N.A.
Subsequently, Dana Corp. entered into amendments to its Senior
Secured Superpriority Debtor-in-Possession Credit Agreement with
the DIP Facility Lenders.
Amendment No. 1 to the Credit Agreement provides, among other
things, that all of the loans and other obligations under the
Credit Agreement will be due and payable on the earlier of:
(i) 24 months -- instead of 18 months -- after the effective
date of the Credit Agreement; or
(ii) the consummation of a plan of reorganization under the
Bankruptcy Code.
Amendment No. 2 to the Credit Agreement provides, among other
things, that interest on the term loan facility under the Credit
Agreement will accrue, at Dana's option, either at the London
interbank offered rate plus a 2.25% per annum margin, or the
prime rate plus a 1.25% per annum margin.
The Credit Agreement had provided that interest on the term loan
facility would accrue, at Dana's option, either at LIBOR plus a
3.25% per annum margin, or the prime rate plus a 2.25% per annum
margin.
About Dana Corporation
Toledo, OH-based Dana Corp. -- 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. 16; 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: Unions Balk at Burns, et al. Employment Agreements
-------------------------------------------------------------
International Union, United Automobile, Aerospace and
Agricultural Implement Workers of America is the exclusive
collective bargaining representative of around 5,300 active
employees of the Dana Corp. and its debtor-affiliates, while the
United Steel, Paper and Forestry, Rubber, Manufacturing, Energy,
Allied Industrial and Service Workers International Union, is the
exclusive collective bargaining representative of about 2,800
active employees of the Debtors.
The Unions oppose the Debtor's request to:
(a) enter into employment agreements with Michael J. Burns,
Dana Corporation's president and chief executive officer,
and five senior executives of Mr. Burns' core management
team:
1. Paul E. Miller,
2. Thomas R. Stone,
3. Nick L. Stanage,
4. Michael L. DeBacker, and
5. Ralf Goettel, and
(b) assume certain change of control agreements with three of
the Senior Executives, as amended.
The Unions assert that the Debtors' proposed payments are
retention and severance payments to insiders and, thus, are
subject to Sections 503(c)(1) and (2) of the Bankruptcy Code.
Section 503(c), which became effective October 17, 2005, is
entirely new provision with no antecedent that strictly limits
the payment of retention bonuses and severance payments to
insiders, and prohibits transfers outside the ordinary course of
business unless justified by the facts and circumstances of the
case, Babette A. Ceccotti, Esq., at Cohen, Weiss and Simon LLP,
in New York, notes.
The enactment of Section 503(c) was a result of increasing public
sentiment against the practice of executives of bankrupt
companies generously rewarding themselves during restructuring at
the same time that rank and file workers were suffering
tremendous economic blows as a result of the bankruptcy, Ms.
Ceccotti adds.
Ms. Ceccotti contends that the Debtors completely disregard that
Section 503(c)'s requirements apply to the proposed payments.
Moreover, the payments are not permissible because they run afoul
of Section 503(c)(3)'s provision restricting transfers outside
the ordinary course of business.
Ms. Ceccotti further contends that the Debtors' request that the
Court adopt its proposed definition of insider is an invitation
for the Court to issue an impermissible advisory opinion.
"Because Dana does not dispute that the six executives are
insiders, and because no other individuals are at issue on the
instant Motion, there is simply no issue before the Court
necessitating the adoption of Dana's definition."
Among others, the Employment Agreements propose that each of the
six executives be given incentive bonuses, which are to be paid
pursuant to the Dana Corporation Annual Incentive Plan. Ms.
Ceccotti points out that the Debtors failed to provide
information about the AIP. Therefore the Unions cannot evaluate
the performance measures under which entitlement to a bonus
payment is measured.
Accordingly, the Unions ask the Court to deny the Debtors'
request.
Equity Committee Seeks Adjournment
Based on an initial review of the Debtors' request, the Official
Committee of Equity Security Holders identified numerous
preliminary questions, issues and concerns, Gary Kaplan, Esq., at
Fried, Frank, Harris, Shriver & Jacobson LLP, in New York,
relates.
The Equity Committee immediately asked the Debtors adjourn the
hearing on the Employment Agreement Motion so that it will have
adequate time to review the relevant information, meet with the
Debtors, and attempt to consensually resolve all questions,
issues and concerns. The Motion's hearing was initially
scheduled for July 19, 2006.
The Debtors have confirmed that they do not object to the
adjournment of the Hearing, Mr. Kaplan tells the Court.
Accordingly, the Equity Committee asks the Court to adjourn the
hearing to consider the Employment Motion to August 16, 2006.
Ad Hoc Committee Reserves its Rights
Ira S. Dizengoff, Esq., at Akin, Gump, Strauss, Hauer & Feld LLP,
in New York, relates that the Official Committee of Unsecured
Creditors and other parties sought and were purportedly granted
by the Debtors an extension to object to the Motion by July 17,
2006.
The Ad Hoc Committee of Certain Unsecured Creditors asked for a
similar extension, but the Debtors did not grant its request, Ms.
Dizengoff says.
Accordingly, the Ad Hoc Committee reserves its rights to:
(i) file a supplemental pleading stating its objection to the
Motion;
(ii) raise issues and be heard at the hearing on the Motion;
and
(iii) take any action with respect to the Motion, as may be
appropriate.
About Dana Corporation
Toledo, OH-based Dana Corp. -- 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. 16; 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: Retains Rothschild to Explore Sale Options for Unit
----------------------------------------------------------------
Delphi Corporation retained Rothschild Inc. to explore potential
sale opportunities for Delphi's Cockpits & Interior Systems and
Integrated Closure Systems businesses.
Delphi's Cockpits & Interior Systems business line is the third-
largest producer of instrument panels, consoles and cockpits in
North America and the fourth largest globally. The business has
provided industry-leading design, development and manufacturing
services since 1956. The business currently supports several
high-volume North American OEM platforms.
Integrated Closure Systems consists of the Door Modules and Latch
business lines. The Latch business line holds a top-three market
share and is a technology leader in the industry with a global
presence. The Latch business line has produced latches since
1946, including the Mini-Wedge, currently the best-selling latch
globally. The Door Modules business line has built strong
relationships with multiple OEMs by focusing on high content;
system-engineered and integrated door systems. Since 1980, the
Door Module business line has supported more than 29 vehicle
programs and produced more than 30 million door systems.
Each of the Instrument Panels, Cockpits, Latch and Door Modules
business lines is distinguished by its ability to work with
customers from materials research, engineering, design validation
and safety testing, design integration, production, and control
and logistics, all driven by world-class engineering teams.
Any sale or strategic alternative will be conducted in
coordination with the company's customers, unions, and other
stakeholders to carefully manage the transition of affected
product lines. Also, the disposition of any U.S. operations would
be accomplished in accordance with the requirements of the U.S.
Bankruptcy Court. The company would also begin consultations with
the European Works Council in accordance with applicable laws.
Parties interested in Delphi's Cockpits & Interior Systems and
Integrated Closure Systems businesses may contact:
Michael Barr
Managing Director
Rothschild Inc.
Tel: (212) 403-3737
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 CORP: Court Approves Executive Bonus Plan Extension
----------------------------------------------------------
The Honorable Robert D. Drain of the U.S. Bankruptcy Court for the
Southern District of New York authorized Delphi Corporation and
its debtor-affiliates to continue implementing an Annual Incentive
Plan, related to their proposed Key Employee Compensation Program,
through the second half of 2006.
However, Judge Drain denies the Debtors' request to allow the KECP
to be renewed every six months without notice and hearing.
According to Judge Drain, "It's appropriate for the debtor to
continue to have to go through this process," Bloomberg News
relates.
The Debtors sought approval of the KECP in October 2005. The KECP
was designed to help the Debtors bring their below-market
executive compensation opportunities to competitive levels. The
KECP includes short-term incentives in the form of an Annual
Incentive Plan and long-term incentives in the form of an
emergence bonus plan with cash payments and equity grants.
The AIP's principal elements are:
* The AIP generally applies to all persons holding executive
positions with the Debtors during the six-month period, with
the exception of Delphi's Chairman and Chief Executive
Officer, Robert S. Miller;
* The Debtors will not issue any incentive-compensation
payments unless Delphi achieves its corporate-level earnings
target or Delphi's divisions achieve their division-level
operating-income targets.
* For Covered Employees whose responsibilities are limited to
the corporate level, 100% of their payment opportunities
will be determined by comparing Delphi's earnings with the
corporate target. With respect to Covered Employees within
a division other than the Medical division, 50% of their
payment opportunities will be based on Delphi's earnings
versus the corporate target, and the other half will be
based on the division's operating income versus target.
The split in the Medical division is 30%-70%, rather than
50%-50%.
* Each Covered Employee has a target bonus opportunity that is
calculated based on his or her level of responsibility. If
Delphi or its divisions exceed their targets, the Covered
Employee's bonus opportunity increases accordingly, but in
no event may the bonus opportunity exceed a specified cap.
For Covered Employees who are members of the Delphi Strategy
Board, the cap is 150% of the Covered Employee's target
bonus opportunity. For all other Covered Employees, the cap
is 200%.
* Any payment opportunity is subject to an adjustment based on
the Covered Employee's individual performance during the
six-month period. The adjustment can range from a 100%
reduction to an increase up to the caps. Upward adjustments
are a zero-sum game -- i.e., any upward adjustment must be
counterbalanced by a downward adjustment of equal amount.
* The AIP includes a prophylactic measure designed to prevent
the payment of incentive compensation to Covered Employee
under certain circumstances including with respect to any
Covered Employee who fails to act in good faith and in a
manner consistent with the Debtors' best interests.
The Debtors' second-half 2006 AIP performance targets are:
Division Target
-------- ------
Delphi Enterprise $411,000,000
Powertrain (FKA Energy and Chassis) $58,000,000
Steering $114,000,000
Thermal and Interior $140,000,000
Electronics and Safety $179,000,000
Packard Electric $17,000,000
Product and Service Solutions $22,000,000
Automotive Holdings Group $634,000,000
Medical $9,000,000
Objections
(1) IUE-CWA
The International Union of Electronic, Electrical, Salaried,
Machine and Furniture Workers-Communications Workers of America
said that implementing the annual incentive plan through the
second half of 2006 would complicate the Debtors' collective
bargaining negotiations with their unions and the processes under
Sections 1113 and 1114 of the Bankruptcy Code. The IUE-CWA
represents 8,500 hourly employees of Delphi Corporation.
The IUE-CWA asked the Court to deny or defer the supplemental KECP
request until the conclusion of the Chapter 11 proceeding.
(2) USW
The United Steel, Paper and Forestry, Rubber, Manufacturing,
Energy, Allied Industrial and Service Workers, International
Union, stated that the supplemental KECP unnecessarily imperils
the likelihood of ratification of a USW attrition program.
According to the USW, the AIP targets for the first half of 2006
were easily attainable and the Debtors' executives have done
significantly better for themselves in 2005 and 2006 than in the
preceding years. The Union said that the fortunes of top
management have improved at precisely the same time the Debtors
have moved forward with plans to put most of their unionized
employees out of work and to slash the wages and benefits of the
survivors.
(3) Lead Plaintiffs
The Teachers' Retirement System of Oklahoma, the Public
Employees' Retirement System of Mississippi, Raiffeisen
Kapitalanlage-Gesellschaft m.b.H. and Stichting Pensioenfonds ABP,
the Court-appointed Lead Plaintiffs in the consolidated
securities class action entitled In re Delphi Corp. Securities
Litigation, asserted that any further extension, supplement or
modification of the KECP or AIP should be on notice to all
creditors and interest holders and subject to further Court order.
(4) IBEW, IAM, IUOE
The International Brotherhood of Electrical Workers Local Union
No. 663; International Association of Machinists and Aerospace
Workers, Tool and Die Makers Local Lodge 78, District 10; and the
International Union of Operating Engineers Locals 18S, 101S and
832S collectively represent 135 hourly employees of Delphi
Corporation, et al.
The IBEW, IAM and IUOE contended that the Debtors have not offered
good business reasons for the continuation of the AIP. The unions
believed that continuation of the AIP is neither fair nor
equitable in light of the Debtors' pending motions under Sections
1113 and 1114.
(5) UAW
Accordingly, International Union, United Automobile, Aerospace
and Agricultural Implement Workers of America objected to the KECP
Supplement because it will unduly complicate negotiations in the
Section 1113/1114 process, and because the program would be an
excessive and imprudent use of estate assets.
Debtors Respond to Objections
The unions argue that continuing the AIP is unfair in light of
the Debtors' labor proposals, and that the AIP will impede
collective bargaining and could ultimately derail the Debtors'
reorganization by preventing a successful resolution of labor
issues.
John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher &
Flom LLP, in Chicago, Illinois, points out that the Court
overruled those objections with respect to the first-half AIP,
stating:
"It is very hard to ask someone to make a substantial
give-up, when you yourself have just received the right to
obtain a bonus. And it, at a minimum, takes at least in
practical terms, I would think, at least 10 minutes of
explaining in any meeting where that issue's raised, if
someone's willing to listen, why the fate of one, the bonus,
should not really be tied to the other, and, in fact, that
the request for the concession is thematically, actually
related to the other, in the sense, that they're both
intended to make the debtor more competitive. Nevertheless,
I believe that anyone negotiating in good faith with the
debtors, would ultimately have to accept that explanation.
And, I think that the debtors' unions, their advisors, and
the rank and file, are, first, smart enough to make the
argument, the inevitable argument, and, second, smart enough
also to understand the debtors' and my response."
Several objectors take issue with the fact that the targets for
the second half AIP are lower than those for the first half. Mr.
Butler explains that historical financial data demonstrate that
Delphi's financial performance is seasonal and customarily
declines substantially during the second half of each calendar
year. The business reasons why the Debtors expect this
phenomenon to recur in 2006 include the seasonality of the
business, volume and mix changes, and pricing reductions
associated with the 2007 models produced by original equipment
manufacturers.
The Debtors believe that the targets are set at a reasonable
level that will spur their executives to overcome the challenges
associated with operating a company in Chapter 11 and continue
the company's exceptional performance into the second half of
2006.
Furthermore, Mr. Butler argues that seeking approval of the AIP
every six months is inefficient given that the objections to the
Supplement are largely identical to the objections that were
raised and overruled by the Court as to the first-half AIP. The
Debtors anticipate that these same objections would reappear in
connection with any AIP they propose.
Mr. Butler asserts that conditioning the Debtors' authority on
the existence of an agreement with the Creditors' Committee --
whose membership includes the Debtors' two largest unions as
official or ex officio members -- safeguards the interests of the
unions and other creditors.
The Debtors assure the Lead Plaintiffs that they will continue
the AIP under the same terms and conditions as those set forth in
the initial AIP Order, including the prophylactic measures, with
new performance targets and corresponding payout curves for each
period.
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. 33; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
DYNEGY HOLDINGS: Moody's Rates $297 Million Senior Notes at B2
--------------------------------------------------------------
Moody's Investors Service assigned a B2 rating to Dynegy
Holdings Inc.'s issuance of $297 million senior unsecured notes.
In addition, Moody's affirmed the long term ratings on the
$3.75 billion of outstanding recourse debt of DHI, including its
$670 million in undrawn revolving and synthetic letter of credit
facilities. The rating outlook is stable.
The unsecured notes are being issued to the subordinated debt
holders of Sithe/Independence Power Partners, L.P. in lieu of a
cash payment to purchase $419 million of the outstanding
subordinated debt and approximately $8 million of subordinate
interest payable. The Sithe Independence project is owned by
DHI's parent, Dynegy Inc., which consolidates the subordinated
debt on its books at a heavily discounted value of approximately
$255 million as of June 30, 2006. As a result, DYN's consolidated
debt will increase by only $42 million. In Moody's opinion, the
transaction, which is expected to marginally increase DHI's cash
flows, has no meaningful impact on its credit quality.
The Independence subordinated debt will become a DHI asset from
which DHI will receive coupon payments subject to the project's
compliance with its restricted payments test of 1.5 times coverage
of senior debt service. Moody's notes that the most likely cause
of a failure to meet the restricted payments test would be an
increase in gas prices, which would result in a reduction in
capacity payments payable to Independence by ConEd. However, any
revenues trapped at Independence should be more than offset by
revenue increases at Dynegy's other facilities driven by the
increased gas prices.
Dynegy's B1 corporate family rating is similar to the ratings
assigned to independent power producers Mirant and Reliant, which
have comparable operating risk profiles. In addition to the
company's power generation business concentration risk, the rating
is constrained by a commodity-cyclical business strategy of not
hedging, which leaves Dynegy exposed to a drop in gas prices.
Moody's notes that unlike Reliant, which is pursuing a similar
strategy, Dynegy does not have exposure to the high risk
unregulated retail electric supply business. In addition,
Dynegy's liquidity position is somewhat stronger than that of
Reliant.
Dynegy's projected financial metrics are consistent with its B1
rating, but the company has yet to demonstrate it can achieve
these results. The CFR is supported by the company's diversified
electrical generation asset base, which should benefit from an
expected recovery in the power market, and the flexibility offered
by the company's debt structure, which has no near-term
maturities. While leverage remains high relative to earnings,
Dynegy has recently undergone a significant debt reduction.
Moody's views this as a favorable indication of management's
balanced consideration for the interests of debt and equity
holders. Mirant's recent decision to undertake a significant
share buy-back is expected to have a negative effect on key credit
metrics and resulted in a downgrade of its ratings.
The rating and stable outlook reflect Moody's expectation of DHI's
continued operating performance improvement as the power markets
recover. DHI's ratings could improve through a combination of
greater than expected improved operational performance, consistent
positive free cash flow, and cash flow coverage above 10%. The
ratings could experience negative pressure as a result of further
deterioration in operating or financial performance relative to
plan, a leveraging acquisition, or further reduction in liquidity.
Moody's notes that with its business concentrated in a market
characterized by unpredictable fluctuations in commodity prices,
DHI's ratings could be subject to increased ratings volatility.
Following an extensive restructuring of its business, Dynegy is
now focused on merchant generation. Headquartered in Houston,
Texas, the company's 12,820 MW portfolio of assets is diversified
by geographic region as well as dispatch type and fuel source.
Ratings affirmed include:
Dynegy Holdings Inc.
* Corporate Family Rating, B1
* Senior Secured Revolving Credit Facility, rated Ba3,
$470 million
* Senior Secured Synthetic Letter of Credit Facility, rated
Ba3, $200 million
* Senior Secured Term Loan Facility, rated Ba3, $150 million
* Second Priority Senior Secured Notes, rated B1, $11 million
* Senior Unsecured Notes, rated B2, $2.9 billion outstanding
* Shelf (Senior Unsecured/Subordinated/Preferred), rated
(P)B2/(P)B3/(P)Caa1 respectively
Dynegy Roseton, L.L.C. and Dynegy Danskammer, L.L.C.
* Pass-Through Certificates, rated B2 (senior unsecured
guarantee of DHI), $800 million outstanding
NGC Corporation Capital Trust I
* Trust Securities, rated B3 (DHI subordinated debentures),
$200 million outstanding
Dynegy Inc.
* Shelf (Senior Unsecured/Subordinated/Preferred), rated
(P)Caa1/(P)Caa2/(P)Caa3
Dynegy Capital Trust II
* Shelf rated (P)B3
Dynegy Capital Trust III
* Shelf rated (P)Caa1
DYNEGY HOLDINGS: Fitch Rates $297 Million Senior Notes at B-
------------------------------------------------------------
Fitch assigned a 'B-' rating to Dynegy Holdings Inc.'s $297
million 8.375% senior unsecured notes due 2016. The notes are
offered in exchange for privately placed subordinate non-recourse
project finance debt of Sithe Independence, which is a 1,092
megawatt gas-fired generation facility in upstate New York owned
by the parent company of Holdings, Dynegy Inc.
The exchange results in Holdings assuming the subordinated non-
recourse project debt currently held by a third party. Completion
of the exchange provides DYN with greater financial and
operational control of Sithe Independence, which should allow it
more flexibility in managing the asset.
The ratings for other Holdings securities as well as those of DYN
and Sithe Independence are unaffected. The Rating Outlook of
Holdings is Stable.
DYN's 'B-' IDR recognizes a high level of business risk associated
with its mostly unhedged merchant generation operations and the
correlation of future financial performance to the level of
natural gas prices, which are expected to remain volatile.
While credit measures should improve with less debt and lower
interest costs as a result of the recent liability management
activities, DYN's overall credit profile should remain consistent
with the current Issuer Default Rating (IDR 'B-') over the near
term. Long-term improvement in operating performances and future
upgrades to the IDR will be primarily dependent on a sustained
power market recovery.
In March 2006, Fitch upgraded the senior unsecured debt of
Holdings to 'B-/Recovery Rating (RR) 4' from 'CCC+' in
anticipation of the use of the proceeds from asset sales to
paydown debt and the restructuring of the debt structure. More
important, the company improved its financial flexibility as it
reduced secured obligations to 12% of debt from 52%.
Dynegy Inc and its primary subsidiary, Dynegy Holdings, Inc., own
and operate approximately 11,920 megawatts of power generating
assets.
DYNEGY HOLDINGS: S&P Rates $297 Million Senior Notes at B-
----------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' rating to the
proposed senior unsecured debt offering at Dynegy Holdings Inc.
DHI will issue approximately $297 million of its 8.375% senior
unsecured notes due 2016 in exchange for $419 million principal
amount of subordinated debt at Sithe/Independence Power Partners
L.P., an indirect, wholly owned subsidiary of Dynegy Inc., along
with approximately $8 million of subordinated interest payable,
for a consideration of $298 million.
"Assuming that senior debt-service coverage at SIPP continues to
be strong enough to allow for distributions, the transaction will
be cash flow positive for DHI," said Standard & Poor's credit
analyst Swami Venkataraman.
"Even in the absence of distributions from SIPP, our analysis
indicates that DHI can sustain debt service on the new bonds at
the current rating level," said Mr. Venkataraman.
"However, in the future, DHI's unsecured rating could be notched
down two notches from the corporate credit rating, as opposed to
the one notch at present, if Dynegy adds more unsecured debt
without a commensurate increase in assets."
The stable outlook on Dynegy and its unit DHI reflects the
expectation that the company will generate sufficient cash flow to
service its obligations.
Rating stability and upward ratings momentum are principally
predicated on the success of the refocused business strategy,
combined with the predictability and sustainability of incremental
cash flows to meet debt-service obligations and to strengthen the
balance sheet through debt reduction.
Downward rating actions could occur if cash flow from the
generation business deteriorates due to a lower margin
environment, which would pressure Dynegy's liquidity and its
ability to reduce debt and generate coverage levels commensurate
with the ratings.
EASTMAN KODAK: Can Sue Wachovia Over $8-Mil. Loan, Court Rules
--------------------------------------------------------------
The Eleventh U.S. Circuit Court of Appeals in Atlanta entered an
order allowing Eastman Kodak Co. to sue Wachovia Corp. over an
$8 million loan to Wolf Camera Inc., Laurence Viele Davidson
writes for Bloomberg News.
According to the report, Kodak agreed to provide Wolf with a
$63 million financing to keep it afloat before and after its 2001
bankruptcy. Wolf then used $8 million to pay down a Wachovia
loan, Bloomberg relates. Kodak now wants that money back, saying
it might have been defrauded by Wolf, Bloomberg cites the court
decision.
The order reverses a 2003 federal-court ruling legally barring
Kodak from raising its claim because Wolf had exited bankruptcy,
Bloomberg says.
The case is Eastman Kodak v. Atlanta Retail, Inc., f.k.a. Wolf
Camera etc., and Wachovia Bank, No. 05-12327, 11th U.S. Circuit
Court of Appeals (Atlanta).
About Eastman Kodak
Headquartered in Rochester, New York, Eastman Kodak Company --
http://www.kodak.com/-- is a worldwide vendor of imaging
products and services. The company is committed to a digitally
oriented growth strategy focused on four businesses: Digital &
Film Imaging Systems - providing consumers, professionals, and
cinematographers with digital and traditional products and
services; Health -- supplying the medical and dental professions
with traditional and digital imaging and information systems, IT
solutions, and services; Graphic Communications - providing
customers with a range of solutions for prepress, traditional
and digital printing, document scanning, and multi-vendor IT
services; and Display & Components - supplying original
equipment manufacturers with imaging sensors as well as
intellectual property and materials for the organic light-
emitting diode and LCD display industries.
* * *
As reported in the Troubled Company Reporter on May 25, 2006,
Fitch downgraded Eastman Kodak's Issuer Default Rating to 'B'
from 'BB-' and the company's senior unsecured debt to 'B-' from
'B+' on May 16, 2006. The Outlook remains Negative. The ratings
reflected Fitch's growing concern regarding EK's ability to
generate profitable organic digital revenue growth and sufficient
free cash flow to offset continual declines in the company's
traditional business.
As reported in the Troubled Company Reporter on May 9, 2006,
Moody's Investors Service placed the ratings of the Eastman
Kodak Company on review for possible downgrade. Ratings placed
on Review for Possible Downgrade included the Company's
Corporate Family Rating at B1; Senior Unsecured Rating at B2;
and Senior Secured Credit Facilities at Ba3.
ELINEAR INC: March 31 Working Capital Deficit Tops $3.8 Million
---------------------------------------------------------------
eLinear, Inc., filed its financial results for the first quarter
ended March 31, 2006, with the Securities and Exchange Commission
on July 18, 2006.
For the three months ended March 31, 2006, the Company incurred a
$1.1 million net loss on $6.5 million of net revenues, compared to
a $1.8 million net loss on $5.5 million of net revenues in 2005.
At March 31, 2006, the company's balance sheet showed $6.8 million
in total assets and $10.1 million in total liabilities, resulting
in a $3.2 million stockholders' deficit.
The Company's March 31 balance sheet also showed strained
liquidity with $5.1 million in total current assets available to
pay $8.9 million in total current liabilities coming due within
the next 12 months.
A full-text copy of the Company's Quarterly Report is available
for free at http://researcharchives.com/t/s?e4c
Going Concern Doubt
Lopez, Blevins, Bork & Associates, LLP, in Houston, Texas, raised
substantial doubt about eLinear, Inc.'s ability to continue as a
going concern after auditing the Company's consolidated financial
statements for the year ended Dec. 31, 2005. The auditor pointed
to the Company's recurring operating losses and need to raise
additional financing in order to satisfy its vendors and other
creditors and execute its business plan.
Based in Houston, Texas, eLinear, Inc. (AMEX: ELU) --
http://www.elinear.com/-- is a communications, security and
compliance company providing integrated technology solutions
including information and physical security, IP Telephony and
network and storage solutions infrastructure. The Company's
customers are Fortune 2000 and small to medium sized business
organizations. As of Dec. 31, 2005, eLinear had four wholly owned
subsidiaries, NetView Technologies, Inc., NewBridge Technologies,
Inc., TanSeco Systems, Inc. and UTEK Corporation and a 51%
interest in eLinear Middle East FZ, LLC.
ENRON CORP: Wants Court to Approve Oneok Settlement Agreement
-------------------------------------------------------------
Enron Corp. and Enron North America Corp. seek the U.S. Bankruptcy
Court for the Southern District of New York's approval of their
settlement agreement with ONEOK Energy Services Company, L.P.,
formerly known as ONEOK Energy Marketing and Trading Company,
L.P.; ONEOK, Inc.; and King Street Acquisition Company, L.L.C.
Frederick W. H. Carter, Esq., at Venable LLP, in Baltimore,
Maryland, relates that, ENA and ONEOK entered into various
financial and physical trading transactions related to the
purchase and sale of natural gas, fuel oil, crude oil, other
energy products and other products related thereto and those
transactions were governed by various contracts. Enron Corp.
guaranteed ENA's obligations to ONEOK under the contracts.
After the Petition Date, ONEOK transferred its claims against
Enron Corp. and ENA to Bear, Stearns & Co. Bear Stearns
subsequently transferred its claims to Silver Oak Capital, LLC,
as agent for and on behalf of AG Capital Recovery Partners III,
LP. Silver Oak subsequently filed Claim Nos. 11322 and 11317
against the Reorganized Debtors.
On November 28, 2003, the Debtors filed Adversary Proceeding
No. 03-93568 against Silver Oak and AG Capital, seeking to
avoid the guarantee agreements.
ONEOK later re-acquired from Silver Oak the portion of the Claims
at issue in the Adversary Proceeding. Silver Oak later
transferred its remaining interests in the Claims to Bear Stearns
Investment Products, Inc., and BSIP in turn, transferred its
interests in the Claims to King Street, Stark, Seneca Capital,
L.P., and Quantum Partners LDC.
To settle their disputes, the parties reached the settlement
agreement, which provides that:
(a) Claim No. 11322 will become an allowed Class 5 general
unsecured claim against ENA in an agreed amount, with any
interest previously held by Quantum or Seneca to be
disallowed and expunged;
(b) Claim No. 11317 will become an allowed Class 185 general
unsecured claim against ENA in an agreed amount, with any
interest previously held by ONEOK, Quantum or Seneca to
be disallowed and expunged;
(c) Claim Nos. 1132201, 1132203, 1131701, 1131702 and 1131704
will be withdrawn with prejudice and to the extent
applicable, expunged;
(d) the Adversary Proceeding will be dismissed with prejudice;
and
(e) the parties will mutually release each other from all
claims arising from the contracts, guarantees and the
Adversary Proceeding.
Headquartered in Houston, Texas, Enron Corporation filed for
chapter 11 protection on December 2, 2001 (Bankr. S.D.N.Y. Case
No. 01-16033) following controversy over accounting procedures,
which caused Enron's stock price and credit rating to drop
sharply. Judge Gonzalez confirmed the Company's Modified Fifth
Amended Plan on July 15, 2004, and numerous appeals followed. The
Debtors' confirmed chapter 11 Plan took effect on Nov. 17, 2004.
Martin J. Bienenstock, Esq., and Brian S. Rosen, Esq., at Weil,
Gotshal & Manges, LLP, represent the Debtors in their
restructuring efforts. Luc A. Despins, Esq., Matthew Scott Barr,
Esq., and Paul D. Malek, Esq., at Milbank, Tweed, Hadley & McCloy,
LLP, represent the Official Committee of Unsecured Creditors.
(Enron Bankruptcy News, Issue No. 176; Bankruptcy Creditors'
Service, Inc., 15/945-7000)
ENRON CORPORATION: Canada Unit to Liquidate and Dissolve
--------------------------------------------------------
Enron Canada Corp. gave notice to all creditors and other
interested parties that it intends to liquidate and dissolve under
Section 211 of the Canada Business Corporations Act, R.S.C. 1985,
c. C-44. The Company says that it received from the Director
under CBCA, a Certificate of Intent to Dissolve issued on July 14,
2006.
The Company discloses that it will distribute its remaining
property to shareholders in accordance with the CBCA, after
adequately providing for the payment or discharge of all of its
obligations.
Enquiries or notices related to Enron Canada's liquidation should
be delivered no later than 4:30 p.m. (Mountain Standard Time) on
August 25 to:
Enron Canada Corp.
1810, 540 - 5 Avenue Southwest
Calgary, Alberta, Canada T2P 0M2
Attention: L. Johnson
Headquartered in Houston, Texas, Enron Corporation filed for
chapter 11 protection on December 2, 2001 (Bankr. S.D.N.Y. Case
No. 01-16033) following controversy over accounting procedures,
which caused Enron's stock price and credit rating to drop
sharply. Judge Gonzalez confirmed the Company's Modified Fifth
Amended Plan on July 15, 2004, and numerous appeals followed. The
Debtors' confirmed chapter 11 Plan took effect on Nov. 17, 2004.
Martin J. Bienenstock, Esq., and Brian S. Rosen, Esq., at Weil,
Gotshal & Manges, LLP, represent the Debtors in their
restructuring efforts. Luc A. Despins, Esq., Matthew Scott Barr,
Esq., and Paul D. Malek, Esq., at Milbank, Tweed, Hadley & McCloy,
LLP, represent the Official Committee of Unsecured Creditors.
ENTERGY NEW: Plaintiffs Respond to Summary Judgment Requests
------------------------------------------------------------
The summary judgment motions of Entergy Corp. and its affiliates
essentially ask the U.S. Bankruptcy Court for the Eastern District
of Louisiana to decide class certification, on the merits, before
the July 31, 2006 class certification hearing, and without the
benefit of evidence or fully developed record, says Luke F.
Piontek, Esq., at Roedel, Parsons, Koch, Blache, Balhoff &
McCollister, in Baton Rouge, Louisiana.
The crux of the summary judgment motions, Mr. Piontek notes, is
the conclusory, factually, unsupported, legally incorrect, and
self-contradictory argument that the class certification sought by
the Lowenburg and Gordon Plaintiffs fails to satisfy the
superpriority requirement of Rule 23 of the Federal Rules of
Civil Procedure because:
(i) either the administrative proceedings already concluded at
the Council for the City of New Orleans, or, a regulatory
proceeding before the U.S. Federal Energy Regulatory
Commission would be a superior procedure for resolving the
Plaintiffs' claims on behalf of ratepayers of Entergy New
Orleans, Inc.; and
(ii) the bankruptcy claims process is superior to class
treatment.
ENOI's ratepayers have rights based upon their claims and causes
of action in the regulatory proceedings, the Gordon suit before
the District Court for the Eastern District of Louisiana, on
appeal of both the Gordon and Lowenburg administrative
proceedings, and in the to-be-refiled Lowenburg class action,
Mr. Piontek notes.
The ratepayers' rights have economic value because if successful
in the lawsuits and appeals, the ratepayers will receive monetary
compensation either in cash payments or credits in future utility
bills, Mr. Piontek asserts. Therefore, the Plaintiffs' rights, in
behalf of the ratepayers, support their cause for class proofs of
claim and certification for voting purposes.
In addition, Civil Rule 56 establishes a motion for summary
judgment as a vehicle to eliminate part or all of a claim or
defense, when the factual bases for the claims or defense are not
disputed, Mr. Piontek notes. The Entergy Entities improperly
attempt to use Rule 56 through inappropriate procedural
maneuvering, he asserts.
Civil Rule 23 promotes the advantages of class certification in
appropriate circumstances. The Entergy Entities' suggestion that
the Plaintiffs are either relegated to a regulatory process that
is already concluded or to a bankruptcy claims process without
proper notice to the class contradicts the purposes of Rule 23,
Mr. Piontek contends.
The City Council proceedings cannot be superior procedure for
resolving the Plaintiffs' claims when they are already concluded
and the Council has already expressly ruled that no claims can be
pursued there, Mr. Piontek further argues.
The City Council already ruled that the Plaintiffs have no right
or mechanism to pursue class-wide remedies before the Council for
other ratepayers and they have no remedies whatsoever available at
the Council, Mr. Piontek points out. The Louisiana courts also
rejected ENOI's argument that the Council proceedings were
superior based on jurisdictional grounds.
The Plaintiffs also dispute ENOI's suggestion that they should
proceed to the FERC. The FERC proceedings cannot be superior as a
matter of law, Mr. Piontek contends. He says that the Gordon and
Lowenburg Proceedings before the Council would not have occurred
if the FERC had exclusive original jurisdiction.
ENOI's suggestion that a bankruptcy claims process without class
certification is superior than class treatment of the Plaintiffs'
claims is unrealistic, Mr. Piontek contends.
Mr. Piontek notes that more than a third of ENOI's total customers
have not returned to New Orleans since Hurricane Katrina. The
suggestion will create massive logistical problems because it
would require each individual class claimant to file a proof of
claim and establish ENOI's liability on the claim and its amount.
The Plaintiffs maintain that class action treatment of their
claims is superior to other available methods because adjudication
of their claims in any other forum or method would result in
denial of their claims.
City Council Reacts
The New Orleans City Council says that the Plaintiffs' objection
contains numerous inaccurate and inflammatory statements
concerning the Council, its advisors and other matters considered
by the Council.
Basile Uddo, Esq., at Sullivan & Worcester LLP in Washington,
D.C., the Council's counsel, proposes to address the Court at the
hearings on the Summary Judgment Motions so as to correct the
record, as it may impact the Court's rulings.
* * *
After considering the arguments of counsel, the Court orders
further briefing by parties, with all briefs due by July 27, 2006
at 4:30 p.m. The Court will take the matter under advisement at
the hearing.
About Entergy New Orleans
Headquartered in Baton Rouge, Louisiana, Entergy New Orleans Inc.
-- http://www.entergy-neworleans.com/-- is a wholly owned
subsidiary of Entergy Corporation. Entergy New Orleans provides
electric and natural gas service to approximately 190,000 electric
and 147,000 gas customers within the city of New Orleans. Entergy
New Orleans is the smallest of Entergy Corporation's five utility
companies and represents about 7% of the consolidated revenues and
3% of its consolidated earnings in 2004. Neither Entergy
Corporation nor any of Entergy's other utility and non-utility
subsidiaries were included in Entergy New Orleans' bankruptcy
filing. Entergy New Orleans filed for chapter 11 protection on
Sept. 23, 2005 (Bankr. E.D. La. Case No. 05-17697). Elizabeth J.
Futrell, Esq., and R. Partick Vance, Esq., at Jones, Walker,
Waechter, Poitevent, Carrere & Denegre, L.L.P., represent the
Debtor in its restructuring efforts. Carey L. Menasco, Esq.,
Philip Kirkpatrick Jones, Jr., Esq., and Joseph P. Hebert, Esq.,
at Liskow & Lewis, APLC, represent the Official Committee of
Unsecured Creditors. When the Debtor filed for protection from
its creditors, it listed total assets of $703,197,000 and total
debts of $610,421,000. (Entergy New Orleans Bankruptcy News,
Issue No. 20; Bankruptcy Creditors' Service, Inc., 215/945-7000)
ENTERGY NEW ORLEANS: Court Okays Panel's Reconsideration Motion
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Louisiana
approves the Reconsideration Motion filed by the Official
Committee of Unsecured Creditors of Entergy New Orleans, Inc.
Judge Jerry A. Brown rules that:
(a) its order approving the Stipulation is withdrawn and the
Stipulation is without any effect or application; and
(b) the Entergy Parties, to the extent they deem necessary,
may file amended proofs of claim on or before August 7,
2006.
David S. Rubin, Esq., at Kantrow, Spaht, Weaver & Blitzer, in
Baton Rouge, Louisiana, maintains that the stipulation, approved
April 18, 2006, was carefully drafted to not impact the rights of
other parties-in-interest, but rather to preserve the rights and
not give any undue advantage to Entergy Corp. and its affiliates.
As reported in the Troubled Company Reporter on May 9, 2006,
Entergy Corporation, on behalf of its affiliates, asserted claims
against Entergy New Orleans, Inc., pursuant to various contractual
relationships between them.
To resolve their dispute, the parties stipulated that:
(a) Entergy Corp. and its affiliates may file one or more
joint Proofs of Claim, which will include the alleged
claims possessed by Entergy Corp. and its affiliates;
(b) Entergy Corp. and its affiliates need not attach
supporting documents to the Master Proofs of Claim, as
long as the Master Proofs of Claim includes a list of the
supporting documents and other agreements with reasonable
specificity so that the nature of the claim may be
ascertained; and
(c) on the request of the Debtor, the Official Committee of
Unsecured Creditors, or any other party-in-interest, the
listed documents will be provided within 10 days after the
request.
The Official Committee of Unsecured Creditors wants the order
approving the Stipulation amended to mandate Entergy Corp. and
Entergy New Orleans, Inc.'s affiliates to file amended proofs of
claim.
If the Creditors Committee' request was granted, the Entergy
Claims would be amended to actually include, instead of merely by
reference, the additional information already given to the
Committee and its financial advisor, FTI Consulting, Inc.,
Mr. Rubin notes.
The Committee's complaint that it was never consulted in advance
of the Stipulation is not relevant to its merits, Mr. Rubin
asserts. Nevertheless, he notes, the Stipulation scrupulously
does not disadvantage the Committee, requires compliance with
applicable rules and law, and reserves all rights to the Debtor
and any other party-in-interest.
The Entergy Entities concede that the Affiliate Claims reserve all
rights of set-off, recoupment and counterclaims.
However, according to Mr. Rubin, the Stipulation has nothing to do
with the reservation of the Affiliate Claims, and the reservations
are to be judged on their merits, if any objection is made to the
claims. He adds that any claimant is entitled to make a
reservation, and inasmuch as the rights are expressly reserved
under the Bankruptcy Code, it is not even necessary to make the
reservations in claims.
The Entergy Entities also refute the Committee's allegations that
the Stipulation "severely prejudices in its analysis of the claims
of the parent and affiliates of [ENOI] and the payments made
postpetition to the parent and the affiliates." The Committee
refers to ENOI's pending request to honor its prepetition
obligations to its affiliates under various power purchase
agreements.
Mr. Rubin notes that the Committee continues to request and
receive from the Entergy Entities documents with respect to the
Affiliates Payment Motion, which is scheduled for hearing on
August 28, 2006.
ENOI clarifies that the amounts asserted by the Affiliate Claims
do not reflect its prepetition payments to its affiliates that are
the subject of the Affiliates Payment Motion, but rather are the
static claims as of September 23, 2005.
Moreover, the Entergy Entities contest the Committee's claims
that:
(1) the Stipulation allows Entergy Corp. and its affiliates to
avoid the attachments of supporting documents; and
(2) some of the Affiliate Claims are not organized
individually by the affiliated entity.
Mr. Rubin maintains that Entergy Services, Inc., and the other
affiliates have produced to the Committee and its financial
advisor data that supports the Affiliate Claims, as well as
additional data the Committee requested.
According to Mr. Rubin, the data produced includes the contracts
and agreements out of which the Affiliate Claims arise, various
spreadsheets showing the calculation of the claims, a detailed
written grid showing the allocation methodologies by which charges
are allocated among the Entergy Affiliates, and samples of
individual invoices and data items.
About Entergy New Orleans
Headquartered in Baton Rouge, Louisiana, Entergy New Orleans Inc.
-- http://www.entergy-neworleans.com/-- is a wholly owned
subsidiary of Entergy Corporation. Entergy New Orleans provides
electric and natural gas service to approximately 190,000 electric
and 147,000 gas customers within the city of New Orleans. Entergy
New Orleans is the smallest of Entergy Corporation's five utility
companies and represents about 7% of the consolidated revenues and
3% of its consolidated earnings in 2004. Neither Entergy
Corporation nor any of Entergy's other utility and non-utility
subsidiaries were included in Entergy New Orleans' bankruptcy
filing. Entergy New Orleans filed for chapter 11 protection on
Sept. 23, 2005 (Bankr. E.D. La. Case No. 05-17697). Elizabeth J.
Futrell, Esq., and R. Partick Vance, Esq., at Jones, Walker,
Waechter, Poitevent, Carrere & Denegre, L.L.P., represent the
Debtor in its restructuring efforts. Carey L. Menasco, Esq.,
Philip Kirkpatrick Jones, Jr., Esq., and Joseph P. Hebert, Esq.,
at Liskow & Lewis, APLC, represent the Official Committee of
Unsecured Creditors. When the Debtor filed for protection from
its creditors, it listed total assets of $703,197,000 and total
debts of $610,421,000. (Entergy New Orleans Bankruptcy News,
Issue No. 20; Bankruptcy Creditors' Service, Inc., 215/945-7000)
EXIDE TECHNOLOGIES: Court Approves Transition Plan on Trademark
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware approved
a transition plan regarding the Exide Technologies trademark,
which will be binding in all respect upon Exide Technologies and
EnerSys, Inc.
The Court-approved Industrial Transition Plan is available for
free at http://researcharchives.com/t/s?e52
The Trademark Transition Plan dates back to April 3, 2006 when the
Court permitted Exide to terminate specific agreements with
EnerSys, including the Trademark License which gave EnerSys the
rights to use the Exide(R) trademark for motive and network power
batteries.
Under the ruling, Exide will reclaim the right to fully
utilize its Exide(R) brand across all product lines -- throughout
most of the world -- after the expiration of a court-ordered
transition period.
The Trademark Dispute stemmed from Exide's March 14, 2003 notice
rejecting six agreements it entered into with EnerSys including
the Trademark and Trade Name Agreement.
EnerSys opposed the rejection of the Trademark License, contending
that rejection of the Trademark License will result in tremendous
confusion in the market place where "Exide" industrial batteries
have been manufactured and sold worldwide by EnerSys for over 12
years.
About Exide
Headquartered in Princeton, New Jersey, Exide Technologies
(NASDAQ: XIDE) -- http://www.exide.com/-- is the worldwide
leading manufacturer and distributor of lead acid batteries and
other related electrical energy storage products. The Company
filed for chapter 11 protection on Apr. 14, 2002 (Bankr. Del. Case
No. 02-11125). Matthew N. Kleiman, Esq., and Kirk A. Kennedy,
Esq., at Kirkland & Ellis, represented the Debtors in their
successful restructuring. Exide's confirmed chapter 11 Plan took
effect on May 5, 2004. On April 14, 2002, the Debtors listed
$2,073,238,000 in assets and $2,524,448,000 in debts. (Exide
Bankruptcy News, Issue No. 88; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
EXIDE TECHNOLOGIES: Board Adopts Short-Term 2007 Incentive Plan
---------------------------------------------------------------
Exide Technologies' Board of Directors has adopted a short-term
incentive plan for fiscal 2007.
The Plan is based on economic profit, or the difference between
EBITDA as adjusted for cash taxes and the cost of the capital
employed to produce EBITDA. The budgeted EP for fiscal 2007
includes stretch goals for EBITDA and working capital reductions.
According to Francis M. Corby, Jr., the company's executive vice
president and chief financial officer, a division employees' award
will be weighted 75% based on the division's EP and 25% for
consolidated corporate EP. A corporate employees' award will be
weighted 100% on consolidated Company EP results.
In addition, the Plan will provide the opportunity for all
salaried North American employees to earn an incentive equal to
3% of an individual's base salary upon the achievement of a
midpoint between the actual fiscal 2006 and the stretch fiscal
2007 EP. Any payment would be received during fiscal 2008, Mr.
Corby says.
Employees eligible to receive incentive compensation under the
Plan will begin accruing first dollar award credit once a certain
threshold level above the actual fiscal 2006 EP is reached, with
an award up to 100% of the individual's targeted bonus level upon
the Company achieving an EP level at the midpoint between actual
fiscal 2006 EP and stretch budget EP for fiscal 2007 and up to
200% of his or her targeted bonus level upon achievement of the
stretch EP budget for 2007.
For Named Executive Officers, the stretch budget 2007 EP target,
if achieved, could result in a payout to:
* Gordon A. Ulsh of up to twice his annual base salary;
* Mitchell S. Bregman, Neil S. Bright, Francis M. Corby, Jr.
and E.J. O'Leary of an amount up to their base salary; and
* Phillip A. Damaska of an amount up to 60% of his base
salary.
No payments will be made until fiscal 2008. A liquidity level as
of March 31, 2007, net of potential payouts under the Plan, has
been established, below which no payments under the Plan will be
made.
About Exide
Headquartered in Princeton, New Jersey, Exide Technologies
(NASDAQ: XIDE) -- http://www.exide.com/-- is the worldwide
leading manufacturer and distributor of lead acid batteries and
other related electrical energy storage products. The Company
filed for chapter 11 protection on Apr. 14, 2002 (Bankr. Del. Case
No. 02-11125). Matthew N. Kleiman, Esq., and Kirk A. Kennedy,
Esq., at Kirkland & Ellis, represented the Debtors in their
successful restructuring. Exide's confirmed chapter 11 Plan took
effect on May 5, 2004. On April 14, 2002, the Debtors listed
$2,073,238,000 in assets and $2,524,448,000 in debts. (Exide
Bankruptcy News, Issue No. 88; Bankruptcy Creditors' Service,
Inc., 215/945-7000)
FAIREL ANDERSON: Case Summary & Largest Unsecured Creditor
----------------------------------------------------------
Debtor: Fairel A. Anderson
aka Fairel Anderson Farr
814 Grandview Road
Sebastopol, California 95472
Bankruptcy Case No.: 06-10450
Chapter 11 Petition Date: July 24, 2006
Court: Northern District of California (Santa Rosa)
Debtor's Counsel: Michael C. Fallon, Esq.
100 East Street, Suite 219
Santa Rosa, California 95404
Tel: (707) 546-6770
Fax: (866) 305-7592
Estimated Assets: $1 Million to $10 Million
Estimated Debts: $50,000 to $100,000
Debtor's Largest Unsecured Creditor:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Arthur Bradshaw Dutcher Personal Loan $70,000
131 Stony Circle
Suite 300
Santa Rosa, CA 95401
FDL INC: Judge Otte Converts Proceeding to Chapter 7 Liquidation
----------------------------------------------------------------
The Honorable Frank J. Otte of the U.S. Bankruptcy Court for the
Southern District of Indiana converted FDL, Inc.'s Chapter 11 case
into a liquidation proceeding under Chapter 7 of the Bankruptcy
Code on July 19, 2006.
The Official Committee of Unsecured Creditors called for the
Debtor's liquidation under Chapter 7 in order to prevent the
further diminution of estate assets in view of the dim prospect
for the Debtor's reorganization.
John M. Rogers, Esq., at Rubin & Levin, PC, told the Court that
the Debtor no longer has any employees and has interests on only a
few remaining assets.
Mr. Rogers argued that conversion will ensure that independent
judgment will be exercised in the pursuit of possible causes of
action against secured creditors Fifth Third Bank and Don Rogers
and Stephen Striebel, the President and sole shareholder of the
Debtor.
Joseph W. Hammes has been named as Chapter 7 Trustee. The Chapter
7 Trustee can be reached at:
Joseph W. Hammes
1 Indiana Sq.
Suite 1900
Indianapolis, Indiana 46204-2032
Telephone number: 317-639-5444
About FDL
Headquartered in Kokomo, Indiana, FDL, Inc., manufactures office
and fast food metal furniture. The company filed for Chapter 11
protection on March 24, 2006 (Bankr. S.D. Ind. Case No. 06-01222).
Deborah Caruso, Esq., and Erick P. Knoblock, Esq., at Dale & Eke,
P.C., represent the Debtor. Elliott D. Levin, Esq., at Rubin &
Levin, represents the Official Committee of Unsecured Creditors.
When the Debtor filed for protection from its creditors, it did
not state its assets but estimated debts between $10 million and
$50 million.
FORD MOTOR: Posts $123 Mil. Net Loss for the Second Quarter 2006
----------------------------------------------------------------
Ford Motor Company reported a net loss of $123 million, for the
second quarter of 2006 compared with net income of $946 million,
in the second quarter of 2005.
The Company disclosed that second quarter loss from continuing
operations was $48 million, compared to a profit of $936 million,
in the same period a year ago. Its second-quarter total sales and
revenue was $42 billion, down $2.5 billion from a year ago.
"We've seen an improvement in North America results in the second
quarter, but the external factors we face aren't going to get any
easier," said Chairman and Chief Executive Officer Bill Ford.
"Mark Fields (executive vice president and president - The
Americas) and his team have been working on plans to accelerate
their efforts. Within the next 60 days, we'll be in a position to
discuss the additional actions we will be taking."
The Company also disclosed that special items reduced earnings in
the second quarter and its pre-tax effect included:
-- A favorable adjustment of $146 million to the first-
quarter $1.7 billion special charge pertaining to expected
layoff and jobs bank benefits and voluntary termination
packages based on agreements at its Atlanta Assembly Plant
and St. Louis Assembly Plant for buyouts and employee
relocation.
-- A charge of $171 million relative to additional personnel
reduction programs, as well as a related charge of $315
million relative to earlier retirements, enhanced
benefits, and the accelerated recognition of future
service costs associated with its U.S. hourly pension
plan.
-- Other gains of $148 million associated with its equity
interest in a non-recurring gain that Mazda realized on
the transfer of its pension liabilities back to the
Japanese government.
The Company further disclosed that it continues to have a strong
year-to-date sales growth in major international markets,
including a 100% increase in China, and a 75% increase in India.
Headquartered in Dearborn, Michigan, Ford Motor Company (NYSE: F)
-- http://www.ford.com/-- manufactures and distributes
automobiles in 200 markets across six continents. With about
300,000 employees and more than 100 plants worldwide, the
company's core and affiliated automotive brands include Aston
Martin, Ford, Jaguar, Land Rover, Lincoln, Mazda, Mercury and
Volvo. Its automotive-related services include Ford Motor Credit
Company.
* * *
As reported in the Troubled Company Reporter on July 24, 2006,
Moody's Investors Service lowered the Corporate Family and senior
unsecured ratings of Ford Motor Company to B2 from Ba3 and the
senior unsecured rating of Ford Motor Credit Company to Ba3 from
Ba2. The Speculative Grade Liquidity rating of Ford has been
confirmed at SGL-1, indicating very good liquidity over the coming
12 month period. The outlook for the ratings is negative.
FREESTAR TECH: Files Amended Financial Statements
-------------------------------------------------
FreeStar Technology Corp. filed with the Securities and Exchange
Commission on July 21, 2006, its amended financial statements for:
-- the year ended June 30, 2005;
-- the first quarter ended Sept. 30, 2005;
-- the second quarter ended Dec. 31, 2005; and
-- the third quarter ended March 31, 2006.
The Company's Statement of Operations showed:
For the period ended
------------------------------------------------
Year Quarter Quarter Quarter
06/30/05 09/30/05 12/31/05 03/31/06
----------- --------- ---------- -----------
Revenue $1,602,819 $602,748 $577,946 $494,296
Net (Loss) ($22,177,057) ($903,068) ($1,809,758) ($2,222,527)
The Company's Balance Sheet showed:
For the period ended
----------------------------------------------
Year Quarter Quarter Quarter
06/30/05 09/30/05 12/31/05 03/31/06
---------- ---------- --------- -----------
Current Assets $837,633 $2,122,001 $1,214,368 $4,888,796
Total Assets $5,367,744 $6,531,584 $5,764,693 $9,464,211
Current
Liabilities $6,555,125 $6,387,633 $1,941,927 $1,483,050
Total
Liabilities $6,555,125 $6,387,633 $1,941,927 $1,483,050
Total
Stockholders'
Equity (Deficit) ($1,187,381) $143,951 $3,822,766 $7,981,160
Reasons of Amendment
The Company filed these amended financials in response to comments
issued by the staff of the Division of Corporation Finance of the
Securities and Exchange Commission.
The amended financials showed the cost of amortizing capitalized
computer software as a cost of revenue in its consolidated
statements of operations. Those costs were previously classified
as selling, general and administrative expenses.
This change in presentation has no impact on previously reported
net loss, revenue, cash, total assets, cash flow or deficiency in
stockholders' equity.
Full-text copies of the company's financial statements are
available for free at:
Year Ended
June 30, 2005 http://ResearchArchives.com/t/s?e41
First quarter ended
Sept. 30, 2005 http://ResearchArchives.com/t/s?e42
Second quarter ended
Dec. 31, 2005 http://ResearchArchives.com/t/s?e43
Third quarter ended
March 31, 2006 http://ResearchArchives.com/t/s?e44
Going Concern Doubt
As reported in the Troubled Company Reporter on March 3, 2006,
Russell Bedford Stefanou Mirchandani LLP raised substantial doubt
about FreeStar Technology's ability to continue as a going concern
after it audited the company's financial statements for the fiscal
year ended June 30, 2005. The auditors cited the company's
difficulty in generating sufficient cash flow to meet its
obligations and sustain operations.
About FreeStar Technology
FreeStar Technology Corporation -- http://www.freestartech.com/--
is a payment processing company. Its wholly owned subsidiary
Rahaxi Processing Oy., based in Helsinki, is a robust Northern
European BASE24 credit card processing platform. Rahaxi currently
processes in excess of 1 million card payments per month for such
companies as Finnair, Ikea, and Stockman. FreeStar is focused on
exploiting a first-to-market advantage for its Enhanced
Transactional Secure Software, which is a software package that
empowers consumers to consummate e-commerce transactions with a
high level of security using credit, debit, ATM (with PIN),
electronic cash or smart cards. The company, based in Dublin,
maintains satellite offices in Helsinki, Santo Domingo, Dominican
Republic, and Geneva.
FRIEDE GOLDMAN: Liquidation Trustees Want Trust Extended for 3 Yrs
------------------------------------------------------------------
Oakridge Consulting, Inc., and Ocean Ridge Capital Advisors,
L.L.C., as Liquidating Trustees for The Consolidated FGH
Liquidating Trust -- the successor-in-interest to Friede Goldman
Halter, Inc., and its debtor-affiliates -- ask the U.S. Bankruptcy
Court for the Southern District of Mississippi to extend the
duration of the Trust for another three years.
Greta M. Brouphy, Esq., at Heller, Draper, Hayden, Patrick & Horn,
LLC, in New Orleans, Louisiana, recalls that the Liquidating Trust
was created under the Debtors' chapter 11 plan for the purpose of
liquidating the Debtors' assets and satisfying claims against the
Debtors.
Under the terms of the Plan, Trust assets, include but are not
limited to causes of action, and rights, title and interest in or
to any and all proceeds of any policy of insurance. Under the
Plan, the Liquidating Trust has the authority to:
(a) prosecute, settle or dismiss any and all causes of action;
(b) liquidate or abandon all assets and distribute proceeds;
(c) control the books and records of the Debtors;
(d) dissolve the Debtors and file tax returns; and
(e) substitute the Liquidating Trustee in any cause of action
relating to the Debtors.
Under the Plan, the Liquidating Trust will continue in full force
and effect until its estate has been wholly converted to cash or
abandoned and all costs, expenses and obligations incurred in
administering the Trust have been fully paid and all remaining
income, proceeds and avails of the Liquidating Trust's estate have
been distributed in payment of the allowed claims. The
Liquidating Trust will exist for three years from the effective
date of the Plan. The Court, however, can extend the term.
Currently, the Liquidating Trust is actively working on completing
these responsibilities:
(1) pursuing litigation aimed at recovering the remaining
insurance receivables;
(2) prosecuting the remaining 122 causes of action based on
preferential payments made within 90 days prior to the
Debtors' bankruptcy filing. The Liquidating Trust has
finalized 111 preference actions;
(3) pursuing breach of contract claims;
(4) pursuing pending litigation and issues on appeal;
(5) finalizing the claims reconciliation process. As of
March 31, 2006, there is over $355 million in claims still
being disputed. The Liquidating Trust has finalized over
$463 million in claim disputes;
(6) making distributions to Trust beneficiaries; and
(7) filing tax returns.
Headquartered in Gulfport, Mississippi, Friede Goldman Halter,
Inc., was a world leader in the design and manufacture of
equipment for the maritime and offshore energy industries. Friede
Goldman and its debtor-affiliates filed for chapter 11 protection
on Apr 19, 2001 (Bankr. D. Ms. Case No. 01-52173). When the
Debtors filed for chapter 11 protection, they listed assets
totaling $802 million and liabilities totaling $704 million. The
Bankruptcy Court confirmed the Debtors' Fourth Amended Joint Plan
or Reorganization on Dec. 30, 2003. The Plan became effective on
Jan. 13, 2004. A Liquidating Trust was created to make liquidate
the Debtors' assets; make distributions and wind down the Debtors
affairs. Oakridge Consulting, Inc., and Ocean Ridge Capital
Advisors, L.L.C., were appointed as Liquidation Trustees.
Douglas S. Draper, Esq., Leslie A. Collins, Esq., and Greta M.
Brouphy, Esq., at Heller, Draper, Hayden, Patrick & Horn, LLC,
represent the Liquidation Trustees.
FTD INC: Moody's Rates $150 Million Senior Term Loan at Ba3
-----------------------------------------------------------
Moody's Investors Service assigned a Ba3 rating to the new senior
secured term loan of FTD, Inc. and affirmed other ratings. The
outlook is changed to positive.
Rating assigned:
* $150 million Senior Secured Term Loan B maturing 2013 at
Ba3.
Ratings affirmed:
* Corporate family at B1;
* Senior subordinated notes at B3, and
* Speculative grade liquidity rating of SGL-2.
Rating upgraded and to be withdrawn:
* Senior secured bank credit facility to Ba3 from B1.
The Ba3 rating on the new term loan, representing one notch above
the corporate family rating, reflects its preferential position in
the capital structure, with the unrated $75 million senior secured
revolving credit facility ranking pari passu, though the revolving
facility has a shorter maturity date. The B1 corporate family
rating balances FTD's solid franchise against its leverage, which
is moderate for the B1 rating category, and increases to a pro-
forma of 4.2 times with the 100% debt financed acquisition of
United Kingdom based Interflora for approximately $125 million,
representing a 9 times multiple.
This acquisition will be financed via a $25 million draw on the
unrated $75 million revolving credit facility, and $100 million of
the new Ba3-rated $150 million senior secured term loan B, with
the remaining $50 million in new term loan proceeds paying down
existing term debt.
The positive outlook reflects Moody's expectation that the risk
with respect to the integration of Interflora will be de minimus,
and will be handled without difficulty. Recent improvements in
operating performance have created sufficient cushion in the
ratings to facilitate this fully-priced, debt-financed
acquisition. Upward rating momentum will continue if reductions
in leverage and improvements in cash flow generation continue.
Quantitatively, if leverage falls below 4 times, and free cash
flow to debt exceeds 10%, and is sustainable at or better than
these levels, an upgrade would result. Downward rating pressure
would result from leverage trending toward 5 times, or free cash
flow to debt reducing below 5%.
The SGL-2 speculative grade liquidity rating reflects Moody's
expectation that FTD will maintain good liquidity, and that
its internally generated cash flow and cash on hand will be
sufficient to fund its working capital, capital expenditure and
debt amortization requirements for the next 12-18 months,
including seasonal peaks.
FTD, Inc., headquartered in Downers Grove, Illinois, is a
leading retailer and order facilitator of flowers and gifts, with
revenues of $438 million for the fiscal year ended June 30, 2005.
It operates the FTD.com website and the 1-800-SEND-FTD telephone
line, and has relationships with approximately 19,000 florists.
GENERAL MOTORS: Secures New $4.63 Billion Debt Facility
-------------------------------------------------------
General Motors Corporation executed a $4.63 billion amended and
restated credit agreement with a syndicate of banks on July 20,
2006. The Agreement provides for both an extended facility of
$4.48 billion which will terminate on July 20, 2011 and for a non-
extended facility of $152 million which expires on June 16, 2008.
Only the extended facility, which consists of 97% of the combined
facility, is secured.
The collateral for the secured facility consists of certain North
American accounts receivable and inventory of General Motors
Corporation, Saturn Corporation, and General Motors of Canada,
Limited, certain plants, property and equipment of General Motors
of Canada and a pledge of 65% of the stock of the holding company
for the General Motors indirect subsidiary, GM de Mexico.
In addition to securing the extended secured facility, the
collateral will also secure certain lines of credit, Auto Clearing
House and overdraft arrangements and letters of credit provided by
the extending secured lenders totaling $1.5 billion. At GM's
current secured credit rating, all-in cost of borrowings from
extending lenders will be LIBOR plus 225 basis points, while all-
in costs of borrowings from non-extending lenders will be LIBOR
plus 160 basis points. In addition, extending lenders received a
consent fee of 40 basis points.
In the event of certain work stoppages, the facility will be
temporarily reduced to $3.5 billion. The Agreement removes any
existing uncertainty as to whether the lenders would be required
to honor a borrowing request by General Motors. The Agreement
will be filed with the Form 10-Q for the quarter ended June 30,
2006.
About General Motors
General Motors Corp. -- http://www.gm.com/-- the world's largest
automaker, has been the global industry sales leader for 75 years.
Founded in 1908, GM today employs about 327,000 people around the
world. With global headquarters in Detroit, GM manufactures its
cars and trucks in 33 countries including Mexico. In 2005, 9.17
million GM cars and trucks were sold globally under the following
brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden,
HUMMER, Opel, Pontiac, Saab, Saturn and Vauxhall. GM operates one
of the world's leading finance companies, GMAC Financial Services,
which offers automotive, residential and commercial financing and
insurance. GM's OnStar subsidiary is the industry leader in
vehicle safety, security and information services.
* * *
As reported in the Troubled Company Reporter on June 30, 2006,
Standard & Poor's Ratings Services held all its ratings on General
Motors Corp. -- including the 'B' corporate credit rating and the
'B+' bank loan rating, but excluding the '1' recovery rating -- on
CreditWatch with negative implications, where they were placed
March 29, 2006.
As reported in the Troubled Company Reporter on June 22, 2006,
Fitch assigned a rating of 'BB' and a Recovery Rating of 'RR1' to
General Motor's new $4.48 billion senior secured bank facility.
The 'RR1' is based on the collateral package and other protections
that are expected to provide full recovery in the event of a
bankruptcy filing.
GLOBAL HOME: Has Until Jan. 15 to Remove State Court Civil Suits
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware extended
until Jan. 15, 2007, the period within which Global Home Products,
LLC, and its debtor-affiliates can remove state court civil
actions to the U.S. District Court for the District of Delaware or
the Bankruptcy Court.
David M. Bertenthal, Esq., at Pachulski Stang Ziehl Young Jones &
Weintraub, LLP, in Wilmington, Delaware, tellsd the Court that
since the Debtors filed for bankruptcy, they have been constantly
and persistently occupied with matters of immediate importance to
their chapter 11 cases. The Debtors have devoted substantial
amounts of time to transitioning into chapter 11 and on actively
preparing, and ultimately filing, their schedules.
Furthermore, after filing for bankruptcy, the Debtors have focused
their efforts on obtaining expedited Court approval for the sale
of some assets, addressing issues to that sale and working with
key constituencies on issues relating to their cases.
Headquartered in Westerville, Ohio, Global Home Products, LLC
-- http://www.anchorhocking.com/and http://www.burnesgroup.com/
-- sells houseware and home products and manufactures high
quality glass products for consumers and the food services
industry. The company also designs and markets photo frames,
photo albums and related home decor products. The company and
16 of its affiliates, including Burnes Puerto Rico, Inc., and
Mirro Puerto Rico, Inc., filed for Chapter 11 protection on
Apr. 10, 2006 (Bankr. D. Del. Case No. 06-10340). Laura Davis
Jones, Esq., Bruce Grohsgal, Esq., James E. O'Neill, Esq., and
Sandra G.M. Selzer, Esq., at Pachulski, Stang, Ziehl, Young, Jones
& Weintraub LLP, represent the Debtors. Bruce Buechler, Esq., at
Lowenstein Sandler, P.C., represents the Official Committee Of
Unsecured Creditors. When the company filed for protection from
their creditors, they estimated assets between $50 million and
$100 million and estimated debts of more than $100 million.
GRAN TIERRA: Deloitte & Touche Expresses Going Concern Doubt
------------------------------------------------------------
Deloitte & Touche LLP expressed substantial doubt about the
ability of Gran Tierra Energy Inc. fka Goldstrike Inc. to continue
as a going concern after auditing the Company's financial
statements for the year ending Dec.31, 2005.
The auditing firm says that the Company's ability to continue as a
going concern is dependent upon obtaining the necessary financing
to acquire oil and natural gas interests and generate profitable
operations from the Company's oil and natural gas interests in the
future.
The Company incurred a $2.2 million net loss for the period ended
Dec. 31, 2005, negative cash flows from operations of
$1.9 million, and, as of Dec. 31, 2005, had an accumulated deficit
of $2.2 million.
The Company expects to incur substantial expenditures to further
its capital investment programs and its cash flow from operating
activities may not be sufficient to satisfy its current
obligations and meet our capital investment objectives.
As of December 31, 2006, the Company's balance sheet showed assets
amounting to $12,371,131 and an $11,039,347 stockholders' equity.
A full-text copy of the Annual Report on Form 10-KSB/A filed with
the Securities and Exchange Commission on July 18, 2006, is
available for free at http://ResearchArchives.com/t/s?e55
Gran Tierra Energy Inc., fka Goldstrike Inc., is an independent
international energy company involved in oil and natural gas
exploration and exploitation.
HCA INC: Earns $295 Million For Quarter Ended June 30
-----------------------------------------------------
HCA (Hospital Corporation of America), Inc., earned $295 million
of net income for the quarter ended June 30, 2006, compared to
$405 million in the second quarter of 2005.
Results for the second quarter of 2006 include gains on sales of
facilities of $5 million. Results for the second quarter of 2005
include a favorable tax settlement of $48 million, recognition of
a previously deferred gain on the sale of certain medical office
buildings of $29 million, and additional depreciation expense of
$30 million, to correct accumulated depreciation and assure a
consistent application of our accounting policies relative to
certain short-lived medical equipment.
Second quarter 2006 results reflect a reduction in the Company's
estimated professional liability reserves of $85 million, compared
to a $36 million reduction, recorded in the second quarter of
2005.
Second quarter 2006 results also include additional compensation
costs of $10 million, due to the expensing of stock options and
employee stock purchase plan shares associated with the Jan. 1,
2006 adoption of FASB Statement 123 (R), "Share-Based Payment."
Revenues in the second quarter of 2006 totaled $6.4 billion
compared to $6.1 billion in the second quarter of 2005. Same
facility revenues increased 6% compared to the second quarter of
2005. Same facility revenue per equivalent admission increased
5.8% in the second quarter of 2006 (6.9% increase when adjusted
for uninsured discounts) compared to the second quarter of 2005.
Same facility admissions increased 0.5% in the second quarter of
2006 compared to the prior year's second quarter. Same facility
equivalent admissions, which take into consideration outpatient
volumes, increased 0.1% compared to the second quarter of 2005.
Same facility outpatient surgical cases declined 2.1%, due to a
decrease of 3.2% in hospital based outpatient surgeries, while
freestanding ambulatory surgical cases were unchanged year over
year.
The provision for doubtful accounts in the second quarter of 2006
totaled $677 million, or 10.6% of revenues, compared to $541
million, or 8.9% of revenues, in the prior year.
Uninsured discounts in the second quarters of 2006 and 2005 were
$258 million and $184 million, respectively. HCA's uninsured
discount policy, which became effective in the first quarter of
2005, lowers revenues and the provision for doubtful accounts by
generally corresponding amounts. Charity care totaled $350
million in the second quarter of 2006, compared to $275 million in
the previous year's second quarter. Same facility uninsured
admissions, which include charity patients, increased by 2,109
admissions, or 10.5%, in the second quarter of 2006 compared to
the same period of 2005.
HCA's cash flow from operations totaled $406 million in the second
quarter of 2006 compared to $839 million in the second quarter of
2005.
As of June 30, 2006, HCA's balance sheet reflected total debt of
$11.7 billion, stockholders' equity (including common and minority
equity) of $5.7 billion and total assets of $23.1 billion.
About HCA
Headquartered in Nashville, Tennessee, HCA (Hospital Corporation
of America) Inc. -- http://www.hcahealthcare.com/-- is a
healthcare services provider, composed of locally managed
facilities that include approximately 182 hospitals and 94
outpatient surgery centers in 22 states, England and Switzerland.
At its founding in 1968, HCA was one of the nation's first
hospital companies.
* * *
As reported in the Troubled Company Reporter on May 29, 2006,
Standard & Poor's Ratings Services assigned its preliminary 'BB+'
rating to HCA Inc.'s senior unsecured debt securities registered
as a Rule 415 shelf filing. This filing falls under the SEC's
well-known seasoned issuer rules, which do not require a dollar
amount of securities issued. The corporate credit rating on HCA
is 'BB+'. S&P said the outlook is stable.
HCA INC: Leveraged Buyout Prompts Moody's to Review Ratings
-----------------------------------------------------------
Moody's Investors Service placed the ratings of HCA, Inc. under
review for possible downgrade following the announcement that it
had agreed to be acquired in a leveraged buyout led by private
equity investors Bain Capital, Kohlberg Kravis Roberts & Co., and
Merrill Lynch Global Private Equity. The transaction is valued at
approximately $33 billion, including the assumption or repayment
of approximately $11.7 billion of existing HCA debt, and is
expected to close in the fourth quarter of 2006.
Moody's review will focus primarily on the amount and terms of the
financing for the acquisition. In particular, Moody's will
evaluate the financial flexibility of HCA based on the size of its
new debt load and the potential for subordination of the existing
senior unsecured notes, which are rated Ba2.
"A transaction that results in a significant amount of incremental
financial leverage could result in a multiple notch downgrade of
Moody's ratings," said Dean Diaz, Vice President-Senior Analyst
for Moody's.
It is expected that equity will be contributed to fund the
acquisition from the aforementioned buyers, the company's founder
and Board Member, Dr. Thomas Frist, Jr., and members of
management. Moody's also understands that debt financing has been
committed by a number of lenders.
The transaction is subject to shareholder approval, Hart-Scott-
Rodino Antitrust provisions and customary closing conditions.
Additional proposals may also be solicited by the company during
the next 50 days under the terms of the agreement.
On Review for Possible Downgrade:
Issuer: HCA Inc.
* Corporate Family Rating, Placed on Review for Possible
Downgrade, currently Ba2
* Speculative Grade Liquidity Rating, Placed on Review for
Possible Downgrade, currently SGL-2
* Senior Unsecured Bank Credit Facility, Placed on Review for
Possible Downgrade, currently Ba2
* Senior Unsecured Medium-Term Note Program, Placed on Review
for Possible Downgrade, currently Ba2
* Senior Unsecured Regular Bond/Debenture, Placed on Review
for Possible Downgrade, currently Ba2
* Senior Unsecured Shelf, Placed on Review for Possible
Downgrade, currently (P)Ba2
Outlook Actions:
Issuer: HCA Inc.
* Outlook, Changed To Rating Under Review From Stable
HCA, Inc. is a holding company that owns and operates hospitals
and related health care entities through various affiliates.
At June 30, 2006, HCA owned and operated 176 hospitals, 92
freestanding surgery centers and facilities that provide extensive
outpatient and ancillary services. HCA recognized revenue of
approximately $24 billion for the twelve months ended June 30,
2006.
HCA INC: Merger Agreement Prompts S&P's Negative Watch
------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB+' corporate
credit and senior unsecured debt ratings for hospital services
provider HCA Inc. on CreditWatch with negative implications.
The CreditWatch listing follows the announcement today that the
company has entered into a merger agreement with a private equity
consortium. The transaction is valued at about $33 billion, which
includes the assumption or repayment of $11.7 billion of debt.
"We expect that the transaction will include the issuance of a
significant amount of new debt, including debt that will be senior
to the unsecured notes that remain outstanding," said Standard &
Poor's credit analyst David Peknay.
"We believe that the corporate credit rating will likely be
lowered by more than one notch because HCA's financial profile
will weaken substantially. The rating on the unsecured notes will
likely be lowered by even more notches than the corporate credit
rating because this debt will likely become subordinated to the
new senior debt and, therefore, be materially disadvantaged to
senior lenders."
Standard & Poor's expects to review the plan of finance before
resolving the CreditWatch listing. HCA owns and operates 176
hospitals and 92 freestanding outpatient centers.
HEALTHWAYS INC: S&P Rates $400 Million Senior Facility at BB
------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB' corporate
credit rating to Nashville, Tennessee-based Healthways Inc. The
rating outlook is stable.
At the same time, Standard & Poor's assigned its 'BB' loan rating
to the company's proposed $400 million senior secured revolving
credit facility due in 2011. A recovery rating of '3' was also
assigned to the facility, indicating the expectation for
meaningful (50%-80%) recovery of principal in the event of a
payment default.
Proceeds from the financings will be used to acquire LifeMasters,
a privately held disease management service provider, for $307.5
million.
"The speculative-grade rating on Healthways Inc. reflects the
company's narrow business focus, surmountable barriers to
competitive entry, and revenue and channel concentration," said
Standard & Poor's credit analyst Jesse Juliano.
"These risks are partially offset by the strong demand for
Healthways' services, the positive momentum in the disease
management business, and the company's conservative financial
profile."
Healthways is the largest provider of disease and wellness
management services in the U.S. based on revenues and lives under
management. The company has become the leader in the disease
management industry by signing large commercial health plan
contracts, which have spurred Healthways' rapid growth.
Healthways manages chronic diseases and episodic conditions such
as diabetes, cardiovascular diseases, respiratory disorders,
cancer, depression, and others, in addition to an outcomes-driven
wellness program for commercial health plans, self-insured
employers, and the government to reduce health care costs.
The stable outlook reflects the company's leading position in the
disease management industry and the expectation that free cash
flow will be applied to pay down debt. The outlook could be
changed to positive if the company further diversifies its revenue
base, improving its business risk. The outlook could be changed
to negative if the company does not reduce debt or experiences
operating shortfalls, such as major contract losses.
IMPERIAL PETROLEUM: Files 2006 First & Second Quarter Financials
----------------------------------------------------------------
Imperial Petroleum Recovery Corp. delivered to the Securities and
Exchange Commission its financial statements for the:
-- first quarter ended Jan. 31, 2006, on July 20, 2006; and
-- second quarter ended April 30, 2006, on July 21, 2006.
First Quarter Financials
The Company reported a net loss of $45,127 for the three months
ended Jan. 31, 2006, compared to a $1,246,099 of net income for
the same period in 2005. The Company had no sales during these
periods.
At Jan. 31, 2006, the Company's balance sheet showed $2,023,299 in
total assets and $4,672,760 in total liabilities, resulting in a
$2,649,461 stockholders' deficit.
The Company's Jan. 31 balance sheet also showed strained liquidity
with $1,843,643 in total current assets available to pay
$2,189,061 in total current liabilities coming due within the next
12 months.
Full-text copies of the Company's first quarter financials are
available for free at http://ResearchArchives.com/t/s?e3f
Second Quarter Financials
The Company reported a net loss of $235,832 for the second quarter
ended April 30, 2006, compared to a net income of $70,245 for the
same period in 2005. The Company had no revenues for the period.
At April 30, 2006, the Company's balance sheet showed $4,209,378
in total assets and $7,094,671 in total liabilities, resulting in
a $2,885,293 stockholders' deficit.
Full-text copies of the Company's second quarter financials are
available for free at http://ResearchArchives.com/t/s?e40
Going Concern Doubt
As reported in the Troubled Company Reporter on March 29, 2006,
Malone & Bailey, PC, expressed substantial doubt about Imperial
Petroleum Recovery Corporation's ability to continue as a going
concern after auditing the Company's financial statements for the
year ended Oct. 31, 2005. The auditing firm pointed to the
Company's recurring operating losses since its inception,
accumulated deficit and $1,075,442 of debt obligations that were
past due as of Oct. 31, 2005.
About Imperial Petroleum
Headquartered in Houston, Texas, Imperial Petroleum Recovery
Corporation and its wholly owned subsidiary, Petrowave
Corporation, is a leader in developing and marketing innovative
commercial radio frequency energy applications that can be used
within the petroleum and other industries to treat emulsions
containing oil, water and solids in the production process to
enhance process efficiency and improve the Company's customers'
end product, or in the creation of biodiesel fuels.
INCO LTD: Earns $400 Million in 2006 Second Quarter
---------------------------------------------------
Inco Limited reported adjusted net earnings of $400 million for
the second quarter of 2006, compared with adjusted net earnings of
$241 million for the second quarter of 2005.
The principal adjustments made in arriving at adjusted net
earnings for the second quarter of 2006 were:
(a) exclusion of net tax benefits totaling $121 million;
(b) exclusion of non-cash currency translation adjustments of
$64 million; and
(c) exclusion of non-cash gains of $39 million on certain
currency derivative contracts.
The Company's adjusted net earnings of $600 million for the first
six months of 2006 increased, compared to adjusted net earnings of
$483 million for the first six months of 2005. Its net earnings
for the second quarter 2006 were its highest quarterly net
earnings on record. It also generated $582 million of cash flow
from operations before a working capital increase of $265 million
for the quarter.
The capital cost of its Goro project in New Caledonia is expected
to exceed its previous forecast of $2.15 billion and that the
initial start-up will be delayed into 2008 due to incidents of
vandalism and road blockades that shut down work at the site for
three weeks in April.
The Company's cost of sales and other expenses includes costs
associated with third party toll smelting and toll refining of
nickel intermediates of $77 million and $114 million for the
second quarter and first six months of 2006, respectively.
The Company's cash and cash equivalents, at June 30, 2006, were
$690 million, down from $958 million at December 31, 2005,
reflecting cash outflows for capital expenditures for its growth
projects and operations and increased working capital
requirements. Its total debt was $1,921 million at June 30, 2006,
compared with $1,974 million at December 31, 2005.
The Company's Board of Directors, on July 18, 2006, declared a
quarterly dividend on its Common Shares of $0.125 per share,
payable September 1, 2006.
Headquartered in Sudbury, Ontario, Inco Limited (TSX, NYSE:N) --
http://www.inco.com/-- produces 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.
INEX PHARMA: Expects Tekmira Spin-out Completion by September 2006
------------------------------------------------------------------
Inex Pharmaceuticals Corporation anticipates completing the
spin-out of the Company's technology, products, cash and
partnerships into Tekmira Pharmaceuticals Corporation by the end
of September 2006.
Timothy M. Ruane, President and Chief Executive Officer of INEX,
said a shareholder meeting to approve the transaction will occur
Sept. 20, 2006. Shareholders of record on Aug. 11, 2006, will be
eligible to vote. Meeting materials will be mailed to
shareholders in August 2006.
Mr. Ruane said the spin-out transaction is the culmination of a
number of recent achievements for the Company. "INEX has been
very successful over the past number of months including closing
the Hana Biosciences, Inc. product development partnership,
announcing and then expanding the collaboration with Alnylam
Pharmaceuticals, Inc. and eliminating our convertible debt."
"We are confident that Tekmira will become a company with all the
attributes necessary to take INEX's promising products forward
into clinical trials, to work with and benefit from the product
development achievements of INEX's existing partners and to build
significant value for shareholders," Mr. Ruane said.
As reported in the Troubled Company Reporter on July 14, 2006, the
spin-out of Tekmira will take place by way of a Plan of
Arrangement between INEX and its shareholders.
Highlights of the spin-out include transferring to Tekmira:
* All of the pharmaceutical assets from INEX's two technology
platforms, Targeted Chemotherapy and Targeted Immunotherapy;
* All of INEX's cash;
* INEX's pharmaceutical partnerships with Hana Biosciences,
Inc. and Alnylam Pharmaceuticals, Inc.
All of the Tekmira shares will be distributed to INEX common
shareholders and INEX's current management team and employees will
join Tekmira in the same positions they occupy in INEX. The
Tekmira spin-out is subject to all necessary approvals including
shareholder, regulatory and court approval.
The goals for INEX and Tekmira for the second half of 2006
include:
* Supporting Hana to advance Marqibo into a phase 3 clinical
trial and advance INX-0125 into a phase 1 clinical trial;
* Supporting Alnylam in evaluating INEX's liposomal drug
delivery technology for the systemic delivery of Alnylam's
RNAi therapeutic products directed towards multiple gene
targets;
* Presenting additional preclinical data for INX-0167 in non-
human primate studies demonstrating its potential as a potent
immune stimulant; and
* Initiating formal toxicology studies for INX-0167 in order to
file an Investigational New Drug Application in 2007 to begin
clinical development.
About INEX
Based in Vancouver, Canada, Inex Pharmaceuticals Corporation
(TSX: IEX) -- http://www.inexpharma.com/-- is a biopharmaceutical
company developing and commercializing proprietary drugs and drug
delivery systems to improve the treatment of cancer.
At Dec. 31, 2005, the Company's balance sheet showed a CDN$21.4
million total shareholders' deficiency, compared to CDN$12.6
deficiency at Dec. 31, 2004.
INTREPID TECH: Posts $485,817 Net Loss in Quarter Ended March 31
----------------------------------------------------------------
Intrepid Technology & Resources, Inc., incurred a $485,817 net
loss on $97,592 of revenues for the quarter ending March 31, 2006.
The operational results were disclosed in a Form 10-Q/A filing
delivered to the Securities and Exchange Commission.
As of March 31, 2006, the Company's balance sheet showed assets
aggregating $1,904,649; liabilities totaling $1,267,250; and a
$637,399 stockholders' equity. At March 31, 2006, the Company had
$416,977 of current assets to pay for $1,267,250 of current
liabilities.
Going Concern Doubt
Jones Simkins, p.c., in Logan, Utah, raised substantial doubt
about Intrepid Technology & Resources, Inc.'s ability to continue
as a going concern after auditing the company's consolidated
financial statements for the year ended June 30, 2005. The
auditor pointed to the company's stockholders deficit and negative
cash flows from operations.
As of March 31, 2006, the Company has incurred a loss and has
negative working capital and negative cash flows from operations.
The Company's management said these factors raise substantial
doubt about the Company's ability to continue as a going concern.
Cornell Capital Agreement
The Company has partially mitigated the going concern doubt by
entering into the agreement with Cornell Capital Partners, LP. On
March 10, 2005, the Company entered into a new Standby Equity
Distribution Agreement with Cornell Capital. Pursuant to the
SEDA, the Company may, at its discretion, periodically sell to
Cornell shares of common stock for a total purchase price of up to
$25 million. For each share of common stock purchased under the
SEDA, Cornell will pay the Company 99% of the lowest closing bid
price of the common stock on the Over-the-Counter Bulletin Board
or other principal market on which the Company's common stock is
traded for the five days immediately following the notice date.
Cornell will retain 5% of each advance under the SEDA.
Bond Financing
The Company's management has also engaged an investment banking
firm to obtain bond financing under a State of Idaho approved bond
inducement resolution to expand operations and production
capabilities. While activities continue on schedule for this bond
financing, there can be no full assurance that these funds will be
available to the Company.
A full-text copy of the regulatory filing is available for free at
http://ResearchArchives.com/t/s?e48
About Intrepid
Intrepid Technology & Resources, Inc., provides engineering,
construction, and operation services for alternative energy
facilities, including methane gas production plants and
hydroelectric, geothermal, and wind generation facilities.
The company also promotes the use of its bioreactor technology
in California.
IRON MOUNTAIN: Moody's Rates $200 Million Senior Notes at B3
------------------------------------------------------------
Moody's Investors Service assigned a B3 rating to the recent issue
of $200 million senior subordinated notes due 2018 of Iron
Mountain Incorporated. In addition, Moody's upgraded the existing
US-based senior secured credit facilities to Ba3 from
B2 and the existing senior subordinated notes to B3 from Caa1.
Concurrently, Moody's affirmed the B2 Corporate Family Rating.
The outlook for the ratings is stable. The new $200 million 8.75%
senior subordinated notes due 2018 offering was completed on
July 17, 2006 and will be used in part to pay down debt associated
with the company's recent offer to repurchase its 8.25% senior
subordinated notes due 2018, retire revolver debt and for other
corporate purposes.
The B2 Corporate Family Rating is supported by the company's
prominent position as a global leader in information storage and
data protection, including its strategic expansion in the digital
market in recent years. Despite meaningful improvement over the
past two years, the Corporate Family Rating of B2 continues to
reflect high financial leverage, the significant amount of
goodwill and intangibles to total assets and the relatively low
level of pro forma free cash flow relative to debt.
Sustained improvements in free cash flow generation after growth
capital expenditures that bring free cash flow to debt closer to
5% could lead to an upgrade, as could reductions in debt to EBITDA
below five times. Material increases in financial leverage from
acquisitions or margin deterioration could put negative pressure
on the company's ratings. In addition, if free cash flow to debt
is anticipated to turn negative for any period of time, the
ratings could be downgraded.
Moody's took these rating actions:
* Assigned a B3 rating to the $200 million issue of 8.75%
guaranteed senior subordinated notes due 2018;
* Upgraded to Ba3 from B2 the $400 million guaranteed senior
secured revolving credit facility of Iron Mountain
Incorporated due 2009;
* Upgraded to Ba3 from B2 the $350 million guaranteed senior
secured Term Loan B of Iron Mountain Incorporated due 2011;
* Upgraded to B3 from Caa1 the $150 million principal amount
of 8.25% guaranteed senior subordinated notes due 2011;
* Upgraded to B3 from Caa1 the $481 million principal amount
of 8.625% guaranteed senior subordinated notes due 2013;
* Upgraded to B3 from Caa1 the $439 million principal amount
of 7.75% guaranteed senior subordinated notes due 2015;
* Upgraded to B3 from Caa1 the $315 million principal amount
of 6.625% guaranteed senior subordinated notes due 2016;
* Upgraded to B3 from Caa1 the $261 million issue of 7.25% GBP
guaranteed senior subordinated notes due 2014;
* Upgraded to (P)Ba3 from (P) B2 secured drawings under the
existing shelf;
* Upgraded to (P)B2 from (P) B3 senior unsecured drawings
under the existing shelf;
* Upgraded to (P)B3 from (P)Caa1 subordinated draws under the
existing shelf;
* Upgraded to (P)Caa1 from (P) Caa2 preferred stock draws
under the existing shelf;
* Upgraded to (P)B3 from (P) Caa2 trust preferred stock shelf
issuances by IM Capital Trust;
* Affirmed the B2 Corporate Family Rating;
* Affirmed the Speculative Grade Liquidity rating of SGL-3.
The outlook for the ratings is stable.
For further detail, refer to Moody's Credit Opinion for Iron
Mountain, Inc.
Headquartered in Boston, Massachusetts, Iron Mountain Incorporated
is an international provider of information storage and protection
related services. The company offers comprehensive records
management and data protection solutions, along with the expertise
to address complex information challenges such as rising storage
costs, litigation, regulatory compliance and disaster recovery.
Founded in 1951, Iron Mountain has more than 90,000 corporate
clients throughout North America, Europe, Latin America, and Asia
Pacific. Net revenue for twelve months ended March 31, 2006 was
approximately $2.1 billion.
JEANTEX GROUP: Posts $1.3 Million Net Loss in First Quarter
-----------------------------------------------------------
Jeantex Group, Inc., incurred a net loss of $1,324,097 from
continuing operations for the quarter ended March 31, 2006,
compared to a net loss of $0 for the quarter ended March 31, 2005.
The Company generated $444,390 of revenues for the quarter ended
March 31, 2006, which took into account the operation of Jeantex
Group, Inc., Jeantex, Inc. and Yves Castaldi, Inc. and no revenue
during the year ended March 31, 2005 pursuant to the restatement
of the discontinued business of Lexor International, Inc.
At March 31, 2006, the Company's balance sheet showed $9,765,750
in total assets, $1,408,400 in total liabilities. The Company
reported a $8,357,350 Stockholders' Deficit at March 31, 2006, due
to accumulated losses of $11,156,363.
A full-text copy of the Company's quarterly report is available
for free at http://researcharchives.com/t/s?e4d
Lexor Merger
The Company had entered into an Agreement of Merger with Lexor in
September 2003. Christopher Long was appointed as the new
president of the Company under the terms of the proposed merger.
On March 31, 2005, the Company and Lexor agreed to terminate their
proposed merger. Under their rescission agreement, the Company
agreed to cancel 10,870,000 shares of class A common stock issued
to Mr. Long and his wife, Ha Nguyen, and pay Mr. Long $250,000.
Lexor would assume all liabilities associated with the Company's
pedicure spa business.
Castaldi Transaction
On June 4, 2006, Jeantex entered into an Amendment to Stock
Purchase Agreement with Yves Castaldi Corp. Pursuant to the terms
of the Amendment, the Company has agreed to reduce its stake in
Castaldi from 51% to 20% of the total issued and outstanding
number of shares of Castaldi.
Castaldi has agreed to retain only 4,000,0000 of the 10,000,000
shares originally issued to it pursuant to the Agreement and will
also retain $226,650 paid to Castaldi by the Company as
consideration for the Company's 20% stake in Castaldi. Castaldi
will immediately surrender the remaining 6,000,000 shares. Yves
Castaldi, President and CEO of Castaldi, will become the majority
owner of Castaldi following the Closing of the Amendment.
Going Concern Doubt
Jaspers + Hall, PC, expressed substantial doubt about Jeantex's
ability to continue as a going concern after auditing the
Company's financial statements for the years ended Dec. 31, 2005
and 2004. The auditing firm pointed to the Company's $9,978,392
accumulated deficit at Dec. 31, 2005.
About Jeantex
Based in Huntington Beach, California, Jeantex Group, Inc. --
http://www.jeantexgroup.com/-- designs, develops, manufactures,
and markets consumer products for the apparel markets worldwide.
The Company is a majority owner of Yves Castaldi Corp., which
designs high end apparel under the 'Just Yves,' "I Generation,'
and 'Instinct Yves' brands and also manufactures and markets new
lines of jeans, T- Shirts, and accessories under the "Bone People"
trademark. The Company has design and manufacturing facilities in
Los Angeles.
KAY HAYWARD: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Kay A. Hayward
21491 Greenwood Road
Philo, California 95466
Bankruptcy Case No.: 06-10453
Chapter 11 Petition Date: July 24, 2006
Court: Northern District of California (Santa Rosa)
Judge: Alan Jaroslovsky
Debtor's Counsel: Douglas B. Provencher, Esq.
Provencher and Flatt, LLP
823 Sonoma Avenue
Santa Rosa, California 95404
Tel: (707) 284-2380
Fax: (707) 284-2387
Estimated Assets: $1 Million to $10 Million
Estimated Debts: $1 Million to $10 Million
Debtor's 20 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Justin Bain $305,000
27 Ridge Avenue
San Rafael, CA 94901
Christopher & Jack Hayward $69,647
P.O. Box 550
Booneville, CA 95415
Trans Tech Consultants $50,000
930 Shiloh Road, Boulevard 444
Suite J
Windsor, CA 95492
James Chanin $50,000
1015 Ashmount
Oakland, CA
Carter/Benhke $40,000
P.O. Box 720
Ukiah, CA 95482
Sunridge Nurseries, Inc. $27,000
Wells Fargo $20,220
T.J. Nelson $20,000
Natural Resource Management Co. $20,000
American River Bank $17,000
Bank of America $13,169
CAT $10,500
Capitol One $6,192
California Department of Forestry $6,000
Terry Bisson $5,000
Mark Jacobson $5,000
Gary Freedman $3,750
Norm Rosen $3,714
Enterprise Rental Car $2,000
Savings Bank of Mendocino $1,500
KOMFORT CARE: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Komfort Care Health Plan
dba Foundation Community Medical Center
8500 South Giueroa Street
Los Angeles, California 90003
Bankruptcy Case No.: 06-13333
Type of Business: The Debtor is a medical services provider.
On June 19, 2006, 501(C)3 Outsourcing Agreement
Foundation Inc., one of Komfort Care Health
Plan's creditors, filedan involuntary chapter 11
petition against Komfort to satisfy an alleged
oral agreement for donations and pledges
(Bankr. C.D. Calif. Case No. 06-12661).
The Debtor previously filed for chapter 11
protection on October 4, 2005 (Bankr. C.D.
Calif. Case No. 05-34856).
Chapter 11 Petition Date: July 24, 2006
Court: Central District Of California (Los Angeles)
Judge: Samuel L. Bufford
Debtor's Counsel: Edgar L. Borne III, Esq.
6025 South Verdun Avenue
Los Angeles, California 90043
Tel: (323) 295-9562
Estimated Assets: $1 Million to $10 Million
Estimated Debts: $1 Million to $10 Million
Debtor's 20 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Clearinghouse Community $740,000
Development Financial
Chicago Title Company
Jeremiah Aguolu, M.D. $95,640
211 North Prairie Avenue
Inglewood, CA 90301
Internal Revenue Service $58,400
Fresno, CA
Kennith Crockett $21,640
9628 Van Nuys Boulevard
Panorama City, CA 91402
State of California $18,540
Department of Industrializing
300 Ocean Gate, Suite 302
Long Beach, CA 90802
501 C3 Outsourcing Foundation $15,490
Jonathan Lee, M.D. $7,650
Venison California $2,800
Mr. R. Hill $2,570
Employment Development Department $2,500
Mr. L. Gaston $1,895
Sanitec West $1,850
T. Burton $1,533
Dr. Daniel Kutuz $1,250
Southern California Edison $1,250
Los Angeles Department of Water & Power $800
Alvin Brown $216
The Rosa & Raymond Parks Wooden Cloth $100
Pen Research Institute
City of Inglewood - Utilities Unknown
SBC Phone Company Unknown
LANDRY'S RESTAURANTS: S&P Puts BB- Corp. Credit Rating on Watch
---------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on Landry's
Restaurants Inc., including the company's 'BB-' corporate credit
rating, on CreditWatch with negative implications.
The rating action follows the company's announcement that it has
retained advisors to assist in evaluating strategic alternatives
for its Joe's Crab Shack and Saltgrass Steak House chains. The
company plans to concentrate more on its higher end restaurant
concepts and hotel/gaming assets.
Joe's and Saltgrass provide a significant amount of the company's
restaurant cash flow.
"We are concerned that these alternatives could shift the
company's business mix towards hotel/gaming, a riskier business in
which the company has little experience," said Standard & Poor's
credit analyst Robert Lichtenstein.
"Standard & Poor's will monitor the use of proceeds as well as the
new capital structure after the completon of any transaction."
LEVITZ HOME: Secures New $89 Million Revolving Credit Facility
--------------------------------------------------------------
Levitz Furniture entered into an $89,000,000, three-year,
revolving credit facility in April 2006. Banc of America
Securities, LLC, and Back Bay Capital Funding, LLC, arranged the
new credit facility.
The $89,000,000 credit facility -- which will be used by Levitz's
new management team -- replaces the company's $55,000,000 credit
facility announced in December 2005.
Headquartered in Woodbury, New York, Levitz Home Furnishings, Inc.
-- http://www.levitz.com/-- is a leading specialty retailer of
furniture in the United States with 121 locations in major
metropolitan areas principally the Northeast and on the West Coast
of the United States. The Company and its 12 affiliates filed for
chapter 11 protection on Oct. 11, 2005 (Bank. S.D.N.Y. Lead Case
No. 05-45189). David G. Heiman, Esq., and Richard Engman, Esq.,
at Jones Day, represent the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they reported $245 million in assets and $456 million
in debts. Jay R. Indyke, Esq., at Kronish Lieb Weiner & Hellman
LLP represents the Official Committee of Unsecured Creditors.
Levitz sold substantially all of its assets to Prentice Capital on
Dec. 19, 2005. (Levitz Bankruptcy News, Issue No. 17; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
LOVESAC CORP: Wants Settlement with Series A Investors Approved
---------------------------------------------------------------
The LoveSac Corporation and its debtor-affiliates ask the
U.S. Bankruptcy Court for the District of Delaware to approve a
settlement agreement with:
* Walnut Investment Partners, LP;
* Walnut Private Equity Fund, LP;
* Brand Equity Ventures, II, LP;
* Barfair Ltd., L.P.;
* Millivere Holdings, Ltd.; and
* Hauser 41, LLC.
These Series A Investors hold certain equity interest in LoveSac.
They have also engaged in lending transactions with the Debtors.
Some of the Series A Investors have designated members that have
served or currently serve on the board of directors of LoveSac.
Christopher A. Ward, Esq., at The Bayard Firm, in Wilmington,
Delaware, tells the Court that the Debtors, in consultation with
the Official Committee of Unsecured Creditors, have investigated
certain potential claims against the Series A investors and
related parties, including, but not limited to, potential
avoidance claims, recharacterization of debt to equity claims,
potential breach of fiduciary claims, and other causes of action.
The Series A Investors have denied liability for all of these
potential causes of action.
The Debtors' chapter 11 plan contemplates the sale of assets to an
affiliate of the Series A Investors as well as a settlement and
release of certain claims against the Series A Investors. Mr.
Ward points out that both the Asset Sale and the Settlement are
integral to the Plan and conditions to the effective date of the
Plan.
Settlement Agreement
Under the Settlement Agreement, each of the Series A Investors
will pay their ratable share of $75,000 to the liquidating trust
to be established under the Plan upon the closing of the Asset
Sale, with the condition that either the Plan must be confirmed,
or the order approving the Settlement Agreement has become final
and non-appealable prior to that payment. Additionally, each of
the Series A Investors will pay their ratable share of a second
$75,000 to the liquidating trust established under the Plan on or
before January 15, 2007. In addition to the payment of these
funds, each of the Series A Investors will assign to the
liquidating trust established under the Plan, all distributions to
which the Series A Investors are or may become entitled to under
the Plan, pursuant to their claims. In the event that the
liquidating trust under the Plan is not yet established when
either the cash payments or the assignment of claims are called
for under the Settlement Agreement, the cash payments or the
assignment will all be made to the Debtors for the benefit of the
liquidating trust.
In exchange for the consideration to be paid to the liquidating
trust, and the assignment of the Series A Investors' claims
against the estate to the other creditors, the Debtors will
provide a comprehensive general release of all claims that the
Debtors may have against any of the Series A Investors or their
affiliates and representatives.
About LoveSac Corporation
Headquartered in Salt Lake City, Utah, The LoveSac Corporation --
http://www.lovesac.com/-- operates and franchises retail stores
selling beanbags furniture. The LoveSac Corp. and three
affiliates filed for chapter 11 protection on Jan. 30, 2006
(Bankr. D. Del. Case No. 06-10080). Anthony M. Saccullo, Esq.,
and Charlene D. Davis, Esq., at The Bayard Firm and P. Casey
Coston, Esq., at Squire, Sanders & Dempsey LLP represent the
Debtors in their restructuring efforts. Michael W. Yurkewicz,
Esq., at Klehr Harrison Harvey Branzburg & Ellers represents the
Official Committee of Unsecured Creditors. When the Debtors filed
for protection from their creditors, they estimated assets and
debts between $10 million to $50 million.
MACREPORT.NET: Incurs $324,401 Net Loss in Quarter Ending May 31
----------------------------------------------------------------
The MacReport.Net, Inc., incurred a $324,401 net loss on $389,967
of revenues for the quarter ending May 31, 2006. The financial
results were disclosed in a Form 10-QSB filing delivered to the
Securities and Exchange Commission on July 20, 2006.
As of May 31, 2006, the Company's balance sheet reported assets
amounting to $3,063,024 and debts totaling $2,878,542.
At May 31, 2006, current liabilities exceed current assets by
$2,068,651. The Company's management said this raises substantial
doubt about the Company's ability to continue as a going concern.
Going Concern Doubt
Holtz Rubenstein Reminick LLP 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
November 30, 2005.
Lucchetti Settlement Agreement
For the period beginning October 2005 through July 2006, V.
William Lucchetti, Jr., the Company's Chief Executive Officer,
Chairman of the Board of Directors and 92% shareholder of the
Company has loaned the Company and its subsidiaries $1,872,583
pursuant to demand notes. Pursuant to the terms of the notes, the
principal accrues interest at a rate of 7.5% per annum. In March
2006, Mr. Lucchetti demanded payment of the notes. The Company
renegotiated the terms of the note and entered into a amended and
restated secured note in favor of Mr. Lucchetti, pursuant to the
terms of the amended notes dated March 15, 2006, the obligations
of the Company and its subsidiaries are secured by all of the
issued and outstanding equity of Marcellus Group, LLC and Ja Spa,
LLC, the Company's wholly owned subsidiaries.
In May 2006, the board of directors of the Company obtained an
appraisal of the market value of the properties owned by Marcellus
Group. The appraisal opinion estimated the fair market value of
the properties at $1,875,000. The properties are subject to a
$300,000 liability. On July 1, 2006, Mr. Lucchetti demanded
payment of the notes. The Company entered into a settlement
agreement with Mr. Lucchetti whereby the notes were forgiven in
exchange for all of the issued and outstanding equity of Marcellus
Group, LLC and Ja Spa, LLC. In addition, Mr. Lucchetti has agreed
to assume all of the obligations of each company, including the
$300,000 liability in connection with the properties, with the
exception of the note in favor of Crown Mill Restoration
Development LLC which was transferred as an obligation of the
Company by consent of Mr. Lucchetti, the sole owner of the Crown
Mill Restoration Development, LLC.
Convertible promissory notes totaling $119,980 bear interest at a
rate of 8% per annum with maturity dates that have expired.
Pursuant to the terms of the convertible notes, if the Company
does not prepay the notes prior to their expiration, on the
expiration date, the Company may convert the balance due together
with accrued interest into shares of the Company's common stock.
The Company is currently in negotiations with these note holders
with respect to the conversion of notes into common stock.
A full-text copy of the regulatory filing is available for free at
http://ResearchArchives.com/t/s?e4f
The MacReport.Net, Inc. was incorporated as a Delaware corporation
in December 2000. The Company is an internet information and
media company formed to allow publicly and privately held
companies to communicate relevant corporate information directly
with the investing public. This is done through the use of a web
site that provides the user with key information via management
interviews, press releases, and other information.
MEDICALCV INC: Auditor Expresses Going Concern Doubt Over Losses
---------------------------------------------------------------
Lurie Besikof Lapidus & Company, LLP, expressed substantial doubt
about MedicalCV, Inc.'s ability to continue as a going concern
after auditing the Company's financial statements for the year
ending April 30, 2006.
The Auditor pointed to the Company's operating losses and negative
cash flows from operations and its need for additional funds to
finance its working capital and capital expenditure needs.
The Company incurred a $9,232,390 net loss for the year ending
April 30, 2006. As of April 30, 2006, the Company's balance sheet
reported assets amounting to $11,586,002 and debts totaling
$3,847,639.
The Company's management anticipates that the Company's sales and
marketing, general and administrative and research and development
services expenses will continue to constitute a material use of
its cash resources. The actual amounts and timing of its expenses
will vary significantly depending upon progress on the Company's
product development projects and the availability of financing.
Given the Company's $10,351,570 cash balance at April 30, 2006,
the Company's management anticipates that the Company will require
additional financing to enable it to build inventory, launch and
market its ATRILAZE minimally invasive system and provide working
capital to support its operations.
The Company's capital requirements may vary depending upon the
timing and the success of the implementation of its business plan,
regulatory, technological and competitive developments, or if:
-- sales of its products are not achieved;
-- operating losses exceed its projections;
-- manufacturing and development costs or estimates prove to be
inaccurate; or
-- the Company determines to acquire, license or develop
additional technologies.
The Company's management said they cannot, however, assure that
efforts to enter the market for treating atrial fibrillation
through laser ablation will be attainable, profitable, or will
reduce their reliance upon financing transactions or enable them
to continue operations.
A full-text copy of the Annual Report in Form 10-KSB filed with
the Securities and Exchange Commission on July 20, 2006, is
available for free at http://ResearchArchives.com/t/s?e51
Headquartered in Inver Grove Heights, Minnesota, MedicalCV, Inc.
-- http://www.medicalcvinc.com/-- is a cardiothoracic surgery
device manufacturer. Previously, its primary focus was on heart
valve disease. It developed and marketed mechanical heart valves
known as the Omnicarbon 3000 and 4000. In November 2004, after an
exhaustive evaluation of the business, MedicalCV decided to
explore options for exiting the mechanical valve business. The
Company intends to direct its resources to the development and
introduction of products targeting treatment of atrial
fibrillation.
MERCURY INTERACTIVE: Inks Merger Deal with Hewlett-Packard
----------------------------------------------------------
Mercury Interactive Corporation entered into an Agreement and Plan
of Merger with Hewlett-Packard Company and HP's subsidiary, Mars
Landing Corporation, on July 25, 2006.
The transaction brings together the strength of HP OpenView
systems, network and IT service management software with Mercury's
strength in application management, application delivery, IT
governance and service-oriented architecture governance. This
combination provides customers with the industry's most robust
suite for optimizing, automating and aligning IT services with
business needs.
Pursuant to the Merger Agreement, Merger Sub will commence a cash
tender offer for all of the issued and outstanding shares of
common stock, par value $0.002 per share, of the Company at a
purchase price of $52 per share.
As soon as practicable after the consummation of the Offer, Merger
Sub will merge with Mercury Interactive and the Company will
become a wholly owned subsidiary of HP. In the Merger, the
remaining stockholders of the Company, other than such
stockholders who have validly exercised their appraisal rights
under the Delaware General Corporation Law, will be entitled to
receive the Offer Price per share.
"Today, we are combining two market-leading businesses to create
the most powerful management software portfolio in the industry,"
said Mark Hurd, HP chief executive officer and president.
"Together, they will help customers cut their IT costs, speed the
delivery of new services and drive profitable growth at HP. We
expect this important acquisition to deliver significant value for
our shareholders."
Mercury Chief Executive Officer and President Tony Zingale said,
"Together, HP and Mercury instantly become the industry's premier
provider of business technology optimization (BTO) software. A
deal of this magnitude creates significant opportunities for our
customers, our shareholders, our people and our partners."
In connection with the Merger Agreement, and in order to induce HP
and Merger Sub to enter into the Merger Agreement, directors,
Giora Yaron, Igal Kohavi, Yair Shamir, Clyde Ostler, Brad Boston,
Joseph Costello and Stanley Keller and officers, Anthony Zingale,
David Murphy, James Larson, Brian Stein, Sandra Escher and Yuval
Scarlat of the Company, in their respective capacities as
stockholders of the Company, entered into Tender and Voting
Agreements, each effective as of July 25, 2006. Pursuant to their
agreement, the stockholders agreed, among other things, to tender
the shares held by them in the Offer and to vote such shares in
favor of adoption of the Merger Agreement.
A full-text copy of the Merger Agreement is available for free
at http://researcharchives.com/t/s?e5f
About HP
Hewlett-Packard Company -- http://www.hp.com/-- is a technology
solutions provider to consumers, businesses and institutions
globally. The company's offerings span IT infrastructure, global
services, business and home computing, and imaging and printing.
For the four fiscal quarters ended April 30, 2006, HP's revenue
totaled $88.9 billion.
About Mercury Interactive
Mercury Interactive Corporation -- http://www.mercury.com/--
provides software and services for IT Governance, Application
Delivery, and Application Management. Customers worldwide rely on
Mercury's offerings to govern the priorities, processes and people
of IT and test and manage the quality and performance of business-
critical applications.
* * *
As reported in the Troubled company Reporter on Oct. 28, 2005, the
Company violated provisions of the indentures related to its 4.75%
Convertible Subordinated Notes due July 1, 2007 issued in 2000 and
the Zero Coupon Senior Convertible Notes due 2008 issued in 2003
as a result of its failure to file a Form 10-Q for the period
ended June 30, 2005. The Company received a notice of default
from the Notes Trustee on Aug, 26, 2005.
The Noteholders agreed to waive, until March 31, 2006, any default
or events of default under the indentures. After the Company
failed to file the SEC reports on March 31, 2006, the Noteholders
again agreed to waive the reporting defaults.
In consideration for the waiver, the Company entered into:
1) a supplement to the Indenture governing the 2000 Notes
requiring it to repurchase the 2000 Notes at the option of
the holder on March 1, 2007 at a repurchase price equal to
101.3% of the principal amount of the 2000 Notes, together
with accrued and unpaid interest, if any, and providing
that any 2000 Notes redeemed pursuant to Article XI of the
Indenture during the period from July 1, 2006 through March
5, 2007 shall be at a redemption price of 101.3% of the
principal amount of the 2000 Notes, together with accrued
and unpaid interest, if any, to the redemption date; and
2) a supplement to the Indenture governing the 2003 Notes
requiring it to repurchase the 2003 Notes at the option of
the holder on Oct. 31, 2006, at a repurchase price equal to
107.25% of the principal amount of the 2003 Notes. If all
holders of both series of Notes exercise these put options,
the Company will be required to pay the face value of the
Notes and an additional $36.3 million to the holders of the
2003 Notes on Oct. 31, 2006 or Nov. 30, 2006 and $3.9
million to the holders of the 2000 Notes on March 1, 2007.
MERCURY INTERACTIVE: Will File 2005 Annual Report in Third Quarter
------------------------------------------------------------------
Mercury Interactive Corporation intends to file its Forms 10-Q for
the quarters ended June 30 and Sept. 30, 2005 and its Form 10-K
for the year ended Dec. 31, 2005, during the third quarter of
2006, and to become current in its reporting requirements with the
Securities and Exchange Commission.
Mercury also completed the restatement of its financial statements
for the fiscal years 2004, 2003 and 2002. The restated financial
statements have been filed with the Securities and Exchange
Commission in an amended Form 10-K/A for the year ended Dec. 31,
2004. A full text copy of the amended annual report is available
for free at http://researcharchives.com/t/s?e5e
"We have taken a rigorous and thorough approach to completing the
restatement and re-certification of our financial statements. I
want to thank our customers, partners, shareholders and employees
for their loyalty and support during this time period," said Tony
Zingale, president and chief executive officer at Mercury. "The
Company remains in a strong financial position and we believe has
a significant market opportunity going forward. I am particularly
proud of Mercury's continued ability to execute against our
strategic business plan and our focus on customer success,
technology innovation and expansion of our capabilities through
our acquisitions."
Overview of Restatement
A Special Committee comprised of members of the Audit Committee of
the Board was formed in June 2005 to investigate the Company's
past stock option practices in response to an inquiry initiated by
the SEC in November 2004.
In August 2005, the Special Committee concluded that the actual
grant dates for certain past stock options differed from the
originally stated grant dates for such awards. As a result, the
Company determined that it should have recognized material amounts
of stock-based compensation expense which were not accounted for
in its previously issued financial statements.
As a result of the Special Committee's investigation and the
Company's internal review of its historical financial statements,
the Company has recorded significant adjustments to its previously
filed financial statements.
The restated consolidated financial statements reflect a decrease
in income before provision for taxes of approximately $566.7
million for the periods 1992 through Dec. 31, 2004, consisting
principally of non-cash adjustments to stock-based compensation
expense resulting from the stock option grant and exercise
practices.
The majority of these expenses are reflected as a decrease to
retained earnings in the opening balance sheet for 2002 of
approximately $362.3 million, reflecting adjustments from 1992 to
2001, and the remaining amounts are reported in the Company's
consolidated statements of operations in subsequent periods. The
Company also has made a number of tax-related adjustments arising
principally from the stock-based compensation adjustments.
The cumulative effect of the restatement adjustments on the
Company's restated consolidated balance sheet at Dec. 31, 2004
resulted in an increase in the accumulated deficit offset by a
corresponding increase in additional paid-in capital and unearned
stock-based compensation which results in a net decrease in total
stockholders' equity of $17.1 million. The adjustments reduced
retained earnings as of Dec. 31, 2001 from $155.7 million to an
accumulated deficit of $206.6 million, and reduced retained
earnings as of Dec. 31, 2004 from $347.1 million to an accumulated
deficit of $178.3 million.
2005 Financial Metrics Update
The Company also disclosed full year 2005 revenue of approximately
$843 million and a net full year increase in deferred revenue of
approximately $50 million. The Company's cash and investment
balance was $1.4 billion at December 31, 2005.
Financial Re-Certification
After the November 2005 determinations by the Special Committee,
the Board of Directors requested that the Special Committee work
in conjunction with the Company to conduct a supplemental review
of the principal financial reporting control areas of the Company
and the key individuals functioning in these areas during the
relevant time periods. This re-certification work was conducted
in order to determine whether the work previously carried out by
the Company in connection with the preparation of its restated
financial statements could be relied upon with respect to matters
other than the stock option related matters that were the subject
of the Special Committee's initial efforts.
As a result of the initial Special Committee findings and this
work, the Company determined, as part of the Item 9A Controls and
Procedures disclosure in its amended 2004 Annual Report on Form
10-K/A, that the Company's disclosure controls and procedures were
not effective at a reasonable level of assurance as of December
31, 2004.
In its Item 9A disclosure, the Company identified two material
weaknesses in its internal control over financial reporting as of
December 31, 2004. Notwithstanding these material weaknesses,
management believes that because of the substantial work performed
during the restatement process, the Company's financial position,
results of operations and cash flows, as reflected in the restated
consolidated financial statements, are fairly stated in all
material respects in accordance with GAAP for each of the periods
presented.
Directors Receive "Wells Notice"
On June 23, 2006, the SEC Staff advised counsel for directors Igal
Kohavi, Yair Shamir and Giora Yaron that it is considering
recommending that the Commission file a civil enforcement
proceeding against each of these directors under applicable
provisions of the federal securities laws.
The directors have advised the SEC Staff that they intend to file
a Wells submission arguing that they did not violate the federal
securities laws, that they did not participate in or know of
option backdating and that the charges under consideration are
legally and factually without basis.
In light of the Wells notice, the three directors have offered to
withdraw from their respective positions on the applicable
committees of the Company's Board of Directors, and the Board has
accepted that offer.
Litigation Committee Recommendations
In Feb. 2006, the Board of Directors of the Company formed a
Special Litigation Committee whose purpose is to determine the
course of action that is in the best interests of the Company in
response to the shareholder derivative actions filed on and after
Oct. 14, 2005 in the Superior Court of California for the County
of Santa Clara, the Delaware Chancery Court and the U.S. District
Court for the Northern District of California.
In its June 7, 2006 report, the Special Litigation Committee made
these determinations:
a) The claims against Amnon Landan, the former Chairman and
CEO, should be pursued by the Company using counsel
retained by the Company;
b) The Special Litigation Committee also recommended that the
Special Committee void Mr. Landan's vested and unexercised
options to the extent such options are found by the
Special Committee to have been dated improperly;
c) The derivative claims asserted against former Chief
Operating Officer Ken Klein, former Chief Financial
Officer Doug Smith and former General Counsel Susan Skaer
should be pursued by a shareholder plaintiff in the
context of a derivative action in the Santa Clara County
Superior Court, rather than in the Delaware Chancery Court
or the Northern District of California;
d) The derivative claims against non-management directors
Giora Yaron, Igal Kohavi and Yair Shamir should be
dismissed. The Special Litigation Committee determined
that the derivative claims against Dr. Yaron, Dr. Kohavi
and Mr. Shamir will fail in the face of the provisions of
the Company's Certificate of Incorporation and the
Delaware General Corporation Law which would permit
damages claims against them only for breach of their duty
of loyalty or for actions taken in bad faith;
e) the derivative claims against current CEO and director
Tony Zingale, outside directors Clyde Ostler and Brad
Boston, and former principal accounting officer Bryan
LeBlanc should be dismissed because none of these
individuals was affiliated with the Company at the time of
the principal events at issue; and
f) The derivative claims against the Company's auditor,
PricewaterhouseCoopers, should be stayed at least six
additional months
About Mercury Interactive
Mercury Interactive Corporation -- http://www.mercury.com/--
provides software and services for IT Governance, Application
Delivery, and Application Management. Customers worldwide rely on
Mercury's offerings to govern the priorities, processes and people
of IT and test and manage the quality and performance of business-
critical applications.
* * *
As reported in the Troubled company Reporter on Oct. 28, 2005, the
Company violated provisions of the indentures related to its 4.75%
Convertible Subordinated Notes due July 1, 2007 issued in 2000 and
the Zero Coupon Senior Convertible Notes due 2008 issued in 2003
as a result of its failure to file a Form 10-Q for the period
ended June 30, 2005. The Company received a notice of default
from the Notes Trustee on Aug, 26, 2005.
The Noteholders agreed to waive, until March 31, 2006, any default
or events of default under the indentures. After the Company
failed to file the SEC reports on March 31, 2006, the Noteholders
again agreed to waive the reporting defaults.
In consideration for the waiver, the Company entered into:
1) a supplement to the Indenture governing the 2000 Notes
requiring it to repurchase the 2000 Notes at the option of
the holder on March 1, 2007 at a repurchase price equal to
101.3% of the principal amount of the 2000 Notes, together
with accrued and unpaid interest, if any, and providing
that any 2000 Notes redeemed pursuant to Article XI of the
Indenture during the period from July 1, 2006 through March
5, 2007 shall be at a redemption price of 101.3% of the
principal amount of the 2000 Notes, together with accrued
and unpaid interest, if any, to the redemption date; and
2) a supplement to the Indenture governing the 2003 Notes
requiring it to repurchase the 2003 Notes at the option of
the holder on Oct. 31, 2006, at a repurchase price equal to
107.25% of the principal amount of the 2003 Notes. If all
holders of both series of Notes exercise these put options,
the Company will be required to pay the face value of the
Notes and an additional $36.3 million to the holders of the
2003 Notes on Oct. 31, 2006 or Nov. 30, 2006 and $3.9
million to the holders of the 2000 Notes on March 1, 2007.
MIRANT CORP: Excluded Debtors Want Until December 6 to File Plan
----------------------------------------------------------------
Mirant Corporation debtor-affiliates which did not emerged from
bankruptcy with Mirant ask the U.S. Bankruptcy Court for the
Northern District of Texas to further extend their exclusive
periods to:
(a) adopt or abandon the Debtors' Plan of Reorganization, or
to file a plan of reorganization until December 6, 2006;
and
(b) solicit acceptances of the Plan or another plan until
February 3, 2007.
These debtor-affiliates are:
(a) the New York Debtors -- Mirant Bowline, LLC; Mirant
Lovett, LLC; and Mirant New York, Inc.;
(b) Mirant NY-Gen, LLC; and
(c) Hudson Valley Gas Corporation.
Jeff P. Prostok, Esq., at Forshey & Prostok LLP, in Fort Worth,
Texas, relates that certain issues in the Excluded Debtors'
Chapter 11 cases have not yet been resolved, specifically the New
York Debtors' tax dispute with the New York taxing authorities
and the Mirant NY-Gen, LLC's remediation plan.
Judge Lynn recently issued a Memorandum Order relating to the New
York Debtors' tax issues, Mr. Prostok notes. The Memorandum
Order provides for hearing schedules that will tackle the
resolution of the tax disputes. The Bankruptcy Court or the
Supreme Court of the State of New York, where the Debtors' tax
certiorari actions are pending, may rule on the issues in October
2006.
Mr. Prostok contends that the New York Debtors and Hudson Valley
cannot confirm a plan without resolving the tax disputes with the
New York Taxing Authorities. In addition, Mirant NY-Gen
contemplates selling certain of its assets, which may need to be
addressed prior to the proposal of a plan.
The New York Debtors and Hudson Valley, Mr. Prostok says, will
use the additional time after October 2006 to propose a plan of
reorganization based on the outcome of the tax disputes and the
resolution of other matters.
Mirant NY-Gen will use the extension to begin its compliance with
the remediation plan approved by the Federal Energy Regulatory
Commission and address any related issues, which may arise prior
to proposing a plan.
Denying the requested extension and opening up the Excluded
Debtors' cases to competing plans, on the other hand, would
destabilize the process, risk unnecessary litigation, and delay
the timely emergence of the Excluded Debtors from Chapter 11, Mr.
Prostok points out.
About Mirant Corp.
Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines. Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally. Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590), and emerged under the terms of a
confirmed Second Amended Plan on January 3, 2006. Thomas E.
Lauria, Esq., at White & Case LLP, represented the Debtors in
their successful restructuring. When the Debtors filed for
protection from their creditors, they listed $20,574,000,000 in
assets and $11,401,000,000 in debts. (Mirant Bankruptcy News,
Issue No. 100; Bankruptcy Creditors' Service, Inc., 215/945-7000)
* * *
As reported in the Troubled Company Reporter on July 17, 2006,
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.
Moody's downgraded Mirant Americas Generation, LLC's Senior
Unsecured Regular Bond/Debenture, to B3 from B2. Moody's also
downgraded Mirant Corporation's Corporate Family Rating, to B2
from B1, and Speculative Grade Liquidity Rating, to SGL-2 from
SGL-1. Mirant North America, LLC's Senior Secured Bank Credit
Facility, was also downgraded to B1 from Ba3 and its Senior
Unsecured Regular Bond/Debenture, to B2 from B1.
As reported in the Troubled Company Reporter on July 13, 2006,
Fitch Ratings placed the ratings of Mirant Corp., including the
Issuer Default Rating of 'B+', and its subsidiaries on Rating
Watch Negative following its announced plans to buy back stock and
sell its Philippine and Caribbean assets.
Ratings affected are Mirant Corp.'s 'B+' Issuer Default Rating and
Mirant Mid-Atlantic LLC's 'B+' Issuer Default Rating and the Pass-
through certificates' 'BB+/Recovery Rating RR1'.
Fitch also placed Mirant North America, Inc.'s Issuer Default
Rating of 'B+', Senior secured bank debt's 'BB/RR1' rating, Senior
secured term loan's 'BB/RR1' rating, and Senior unsecured notes'
'BB-/RR1' rating on Rating Watch Negative. Mirant Americas
Generation, LLC's Issuer Default Rating of 'B+' and Senior
unsecured notes' 'B/RR5' rating was included as well.
Standard & Poor's Ratings Services also placed the 'B+' corporate
credit ratings on Mirant Corp. and its subsidiaries, Mirant North
American LLC, Mirant Americas Generating LLC, and Mirant Mid-
Atlantic LLC, on CreditWatch with negative implications.
MIRANT CORP: Equity Panel Counsel Insists on No Fee Enhancement
---------------------------------------------------------------
Mirant Corporation and its debtor-affiliates, the Official
Committee of Unsecured Creditors of Mirant Corporation, et al.,
and the Official Committee of Unsecured Creditors of Mirant
Americas Generation asked the U.S. Bankruptcy Court for the
Northern District of Texas to approve the fee enhancements for
certain core counsel.
Although Brown Rudnick Berlack Israels LLP and Hohmann, Taube &
Summers, L.L.P., are among the core counsel that will benefit
from the fee enhancement in the event the Court approves the
request, the two firms did not support that request.
The Debtors, the Mirant Committee and the MAGi Committee are
attempting to dictate the process of awarding fee enhancements,
Eric J. Taube, Esq., at Hohmann, Taube & Summers, L.L.P., in
Austin, Texas, asserts. The parties are asking Judge Lynn to
disregard the previous procedures the Court has instituted
regarding fee applications and to ignore the law governing fee
enhancements, Mr. Taube notes.
Despite having previously argued that no bonuses be paid in the
Chapter 11 cases, the Debtors and the Mirant Committee -- and now
joined by the MAGi Committee -- seek to thrust a scheme for
awarding fee enhancements on the Court and certain parties that
do not agree with that scheme, Mr. Taube relates.
Aside from being a late-filed fee enhancement application, the
request is premised on the ill-founded position that fee
enhancements should be awarded to the primary estate attorneys
based on the total base fees incurred by the attorneys, Mr. Taube
points out.
The determination of which professionals are entitled to a fee
enhancement and the amount of any of the enhancements is within
the exclusive province of the Court, Mr. Taube adds.
Hence, Brown Rudnick and Hohmann Taube -- the Equity Committee
Counsel -- ask the Court to deny the fee enhancement request.
About Mirant Corp.
Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines. Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally. Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590), and emerged under the terms of a
confirmed Second Amended Plan on January 3, 2006. Thomas E.
Lauria, Esq., at White & Case LLP, represented the Debtors in
their successful restructuring. When the Debtors filed for
protection from their creditors, they listed $20,574,000,000 in
assets and $11,401,000,000 in debts. (Mirant Bankruptcy News,
Issue No. 100; Bankruptcy Creditors' Service, Inc., 215/945-7000)
* * *
As reported in the Troubled Company Reporter on July 17, 2006,
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.
Moody's downgraded Mirant Americas Generation, LLC's Senior
Unsecured Regular Bond/Debenture, to B3 from B2. Moody's also
downgraded Mirant Corporation's Corporate Family Rating, to B2
from B1, and Speculative Grade Liquidity Rating, to SGL-2 from
SGL-1. Mirant North America, LLC's Senior Secured Bank Credit
Facility, was also downgraded to B1 from Ba3 and its Senior
Unsecured Regular Bond/Debenture, to B2 from B1.
As reported in the Troubled Company Reporter on July 13, 2006,
Fitch Ratings placed the ratings of Mirant Corp., including the
Issuer Default Rating of 'B+', and its subsidiaries on Rating
Watch Negative following its announced plans to buy back stock and
sell its Philippine and Caribbean assets.
Ratings affected are Mirant Corp.'s 'B+' Issuer Default Rating and
Mirant Mid-Atlantic LLC's 'B+' Issuer Default Rating and the Pass-
through certificates' 'BB+/Recovery Rating RR1'.
Fitch also placed Mirant North America, Inc.'s Issuer Default
Rating of 'B+', Senior secured bank debt's 'BB/RR1' rating, Senior
secured term loan's 'BB/RR1' rating, and Senior unsecured notes'
'BB-/RR1' rating on Rating Watch Negative. Mirant Americas
Generation, LLC's Issuer Default Rating of 'B+' and Senior
unsecured notes' 'B/RR5' rating was included as well.
Standard & Poor's Ratings Services also placed the 'B+' corporate
credit ratings on Mirant Corp. and its subsidiaries, Mirant North
American LLC, Mirant Americas Generating LLC, and Mirant Mid-
Atlantic LLC, on CreditWatch with negative implications.
MONUMENT BOWL: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Monument Bowl, LLC
aka The Bowling Alley@Palmer Lake
855 Highway 105
Monument, Colorado 80133
Tel: (719) 488-6500
Bankruptcy Case No.: 06-14701
Type of Business: The Debtor operates a bowling center.
See http://www.thebowlingalley.com/
The Debtor previously filed for chapter 11
protection on February 20, 2006 (Bankr. D. Colo.
Case No. 06-10627).
Chapter 11 Petition Date: July 25, 2006
Court: District of Colorado (Denver)
Judge: Elizabeth E. Brown
Debtor's Counsel: Robert M. Duitch, Esq.
Robert M. Duitch, LLC
665 SouthPointe Court, Suite 150
Colorado Springs, Colorado 80906-8839
Tel: (719) 632-3450
Fax: (719) 632-0006
Estimated Assets: $1 Million to $10 Million
Estimated Debts: $1 Million to $10 Million
The Debtor did not file a list of its 20 largest unsecured
creditors.
NAKOMA LAND: Chapter 11 Trustee Wants to Sell Clio California Lot
-----------------------------------------------------------------
Angelique Clark, the chapter 11 trustee appointed in the
bankruptcy cases of Nakoma Land, Inc., and its debtor-affiliates,
asks the U.S. Bankruptcy Court for the District of Nevada for
permission to sell a vacant real property located at 1169 Gold
Star, Clio, California.
The property is owned by Debtor Gold Mountain Ranch, LLC and was
transferred to Gold Mountain by Melkom, Inc., postpetition.
Colin Carter and Noreen Roche Carter offered $185,000 for the lot.
The property has certain liens and encumbrances recorded against
it, including a first priority deed of trust in favor of Investors
Financial, LLC, in the approximate amount of $15 million real
property taxes, water assessment and homeowners' association dues.
Investors Financial, has agreed to forego receiving any payment
from the sales proceeds and to allow for the net proceeds to be
retained by the Debtors' estate for payment of remediation
expenses.
The Trustee has employed Carol Turner and Patty Veith of Mohawk
Valley Associates. The Debtors will have to pay them $7,400, or
4% of the gross sales price. The Debtors ask the Court for
permission to make the payment.
Headquartered in Reno, Nevada, Nakoma Land, Inc., operates the
Nakoma Resort in Plumas County, California. The Debtor along with
its affiliates filed for chapter 11 protection on May 19, 2005
(Bankr. D. Nev. Case No. 05-51556). Alan R. Smith, Esq., at the
Law Offices of Alan R. Smith represented the Debtors. When the
Debtors filed for protection from its creditors, they listed total
assets of $18,000,000 and total debts of $15,252,580. The Court
then appointed Angelique I.M. Clark as chapter 11 trustee. The
U.S. Trustee for Region 13 recommended Ms. Clark's appointment
after Investors Financial LLC, sought for the appointment of a
trustee.
NBC/AUSTIN WINDRIDGE: Court Allows KREEC to Record Trustee's Deed
-----------------------------------------------------------------
The Honorable Marvin Isgur of the U.S. Bankruptcy Court for the
Southern District of Texas in Houston lifts the automatic stay to
allow Key Real Estate Equity Capital, Inc., to exercise its state
law rights against NBC/Austin Windridge, Ltd.'s real and personal
property.
KREEC, as successor-in-interest to KeyBank National Association,
asked the Court to lift the stay so that it can obtain legal title
to certain property acquired from the Debtor by recording a
Trustee's Deed.
KeyBank Loans
Prior to its bankruptcy filing, the Debtor owed KeyBank
approximately $19.1 million on account of a promissory noted dated
May 14, 2002. A non-debtor affiliate, NBC/Las Brisas, Ltd., also
owed KeyBank $3.2 million on account of a separate promissory note
issued on the same date. The Debtor and Las Brisas also issued a
Mezzanine Note in the original principal amount of $8 million.
To secure the debts, the Debtor delivered to KeyBank certain Deed
of Trust, Assignment of Rents, Security Agreement and Fixture
Filing encumbering the Windridge Apartments in Travis County,
Texas.
The Debtor is in default on its KeyBank obligations after it
failed to pay the notes when they matured in July 2005.
As of May 2, 2006, the total amount due and owning under:
-- the Windridge Note was $19.4 million;
-- the Las Brisas Note was $2.4 million; and
-- the Mezzanine Note was $4.5 million.
Foreclosure Sale
Following the assignment of the Debtor's loans, KREEC asked
substitute Deed of Trust Trustee Mark Jones to conduct a
foreclosure sale of the Windridge Apartments.
No other bids were tendered during the auction except for KREEC's
$21.15 million credit bid. The sale of the property to KREEC was
consummated at 12:48 p.m. on May 2, 2006. Right after the sale
was concluded, the Debtor filed for Chapter 11 protection. The
Debtor still owed KREEC approximately $5.3 million when it filed
for bankruptcy.
Because of the Debtor's abrupt bankruptcy filing, Mr. Jones was
unable to record the Trustee's Deed. Duston K. McFaul, Esq., at
Vinson & Elkins LLP, told the Court that lifting the automatic
stay is warranted because KREEC already holds equitable title to
the property, with the Debtor retaining only bare legal title.
KREEC will obtain legal title to the property by recording the
Trustee's Deed.
Headquartered in Houston, Texas, NBC/Austin Windridge, Ltd., and
its debtor-affiliate, NBC Las Brisas, Ltd., filed for chapter 11
protection on May 2, 2006 (Bankr. S.D. Tex. Case Nos. 06-31901 &
06-80154). Richard L. Fuqua, II, Esq., at Fuqua & Keim, LLP,
represents the Debtors. No Official Committee of Unsecured
Creditors has been appointed in the Debtor's case. When the
Debtors filed for protection from their creditors, they estimated
assets and debts between $10 million and $50 million.
NES RENTALS: Completes $850 Million Sale to Diamond Castle
----------------------------------------------------------
NES Rentals Holdings, Inc., completes the sale of the company to
affiliates of Diamond Castle Holdings, LLC, a private equity firm.
Diamond Castle has purchased all of the outstanding shares of
common stock for $18.75 per share. Including the repayment and
assumption of certain outstanding liabilities, the transaction has
a total value of approximately $850 million.
"This has been a positive process for all of NES Rentals'
stakeholders, including our shareholders, employees, and
customers," Chairman and Chief Executive Officer Andrew Studdert
said. "We are excited about partnering with Diamond Castle as we
embark on this next stage of our Company's history. We will now
have the necessary resources to take advantage of the numerous
growth opportunities that lie ahead.
"Our primary goal has always been to be a reliable partner for our
customers. We have made significant investments in our fleet,
having invested almost $300 million in new equipment since 2004,
and have increased our emphasis on equipment maintenance,
reliability and enhanced customer service. Meeting our customers'
needs will continue to be our number one priority going forward."
"We are delighted to be partnering with NES Rentals, a company
with a strong competitive position in a highly attractive segment
of the general rental equipment industry," Ari Benacerraf, co-
founder and Senior Managing Director of Diamond Castle, said.
"We look forward to working with NES Rentals' talented management
team as they continue to profitably grow the business, improve
operational efficiencies, and execute their strategic plan," added
David Wittels, co-founder and Senior Managing Director of Diamond
Castle.
Diamond Castle plans to retain NES Rentals' company name and
management team. Mr. Studdert will continue in his capacity as
Chief Executive Officer and Chairman of the Board.
About Diamond Castle Holdings, LLC
Headquartered in New York City, Diamond Castle Holdings, LLC --
http://www.diamondcastleholdings.com/-- is a private equity
investment firm founded in 2004 by Larry Schloss, the former
Global Head of CSFB Private Equity and Chairman of DLJ Merchant
Banking Partners, and four former managing directors of DLJ
Merchant Banking. Diamond Castle has 22 employees and focuses on
investments in the power, financial services, media and telecom,
healthcare, and industrial sectors.
About NES Rentals Holdings, Inc.
NES Rentals Holdings, Inc. -- http://www.nesrentals.com/-- is a
$29 billion equipment rental company. The company focuses on
renting specialty and general equipment to industrial and
construction end-users. It rents more than 750 types of machinery
and equipment, and distributes new equipment for nationally
recognized original equipment manufacturers. NES Rentals also
sells used equipment as well as complementary parts, supplies and
merchandise, and provides repair and maintenance services to its
customers. In addition to the rental business, NES Rentals
supplies traffic and safety services to the construction industry.
* * *
As reported in the Troubled Company Reporter on July 10, 2006,
Standard & Poor's Ratings Services affirmed its ratings on
equipment rental company NES Rentals Holdings Inc., including its
'B+' corporate credit rating. All ratings were removed from
CreditWatch with negative implications. Ratings were originally
placed on CreditWatch developing on Feb. 22, 2006.
At the same time, Standard & Poor's assigned its 'B-' secured bank
loan rating to NES's proposed $430 million second-lien term loan
facility due in seven years. A recovery rating of '4' was
assigned, indicating marginal prospects for recovery following
repayment of the entire principal amount of the unrated $450
million first-lien revolving ABL facility in the event of a
default. Ratings on the existing second-lien term loan will be
withdrawn when the deal is expected to close in July 2006.
The outlook is stable.
As reported in the Troubled Company Reporter on June 29, 2006,
Moody's Investors Service downgraded the ratings of NES Rentals
Holdings, Inc. -- Corporate Family Rating to B3 from B2 and second
lien senior secured bank credit facility to Caa1 from B3. The
speculative grade liquidity rating remains at SGL-3. The rating
agency also assigned a Caa1 rating to the company's proposed
second lien senior secured bank credit facility. The rating
outlook is Stable.
NORTHWEST AIRLINES: Wants to Assume Orbitz Hosting Agreement
------------------------------------------------------------
Northwest Airlines, Inc., and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Southern District of New York for
authority to assume a March 8, 2002 Development, License and
Hosting Agreement with Orbitz, LLC.
Orbitz provides hosting, operation, maintenance and support
services to Northwest Airlines in connection with the Northwest
Airlines Internet Web site. The Hosting Agreement has been
amended twice and supplemented by Statement of Work No. 2 and
Statement of Work No. 3.
Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP,
in New York, relates that Northwest Airlines and Orbitz
negotiated the terms of a Second Amendment, which continues the
term of the Hosting Agreement through June 30, 2010.
In connection with the assumption of the Hosting Agreement,
Orbitz will be allowed a $705,964 general unsecured claim for
amounts due under the Agreement for the prepetition period. The
parties agree that any "cure" obligations Northwest may have to
Orbitz in connection with Northwest's prepetition defaults under
the Hosting Agreement are deemed satisfied.
Assumption of the Hosting Agreement is necessary to permit
Northwest Airlines to maintain an effective Internet presence,
Mr. Petrick tells the Court. Northwest Airlines will be able to
continue operation of its Web site and retain its license on the
Orbitz software. Moreover, Northwest Airlines will:
(i) have access to future development services from Orbitz to
meet any changing specifications in the booking
functionality of the Web site that it may require;
(ii) receive the benefit of reduced transaction fees;
(iii) establish a single booking product for its global Web
sites; and
(iv) develop disaster recovery capability for its site.
The Debtors also avoid the significant expense of replacing
Orbitz with another provider of these important services,
Mr. Petrick relates.
Northwest Airlines also seeks authority to file the Hosting
Agreements and related documents under seal to protect the
contract parties from disclosing confidential commercial
information.
About Northwest Airlines
Northwest Airlines Corporation (OTC: NWACQ) -- http://www.nwa.com/
-- is the world's fourth largest airline with hubs at Detroit,
Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and
approximately 1,400 daily departures. Northwest is a member of
SkyTeam, an airline alliance that offers customers one of the
world's most extensive global networks. Northwest and its travel
partners serve more than 900 cities in excess of 160 countries on
six continents. The Company and 12 affiliates filed for chapter
11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No.
05-17930). Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq.,
at Cadwalader, Wickersham & Taft LLP in New York, and Mark C.
Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in
Washington represent the Debtors in their restructuring efforts.
The Official Committee of Unsecured Creditors has retained Akin
Gump Strauss Hauer & Feld LLP as its bankruptcy counsel in the
Debtors' chapter 11 cases. When the Debtors filed for protection
from their creditors, they listed $14.4 billion in total assets
and $17.9 billion in total debts. (Northwest Airlines Bankruptcy
News, Issue No. 31; Bankruptcy Creditors' Service, Inc.,
215/945-7000)
OCA INC: Court OKs Amended and Restated Joint Disclosure Statement
------------------------------------------------------------------
The Honorable Jerry A. Brown of the U.S. Bankruptcy Court for
the Eastern District of Louisiana approved the Amended and
Restated Joint Disclosure Statement explaining the Joint Chapter
11 Plan filed by OCA, Inc., and its debtor-affiliates yesterday,
July 24, 2006.
The Court determined that the Disclosure Statement contains
adequate information -- the right amount of the right kind of
information necessary for creditors to make informed decisions --
as required in Section 1125 of the Bankruptcy Code.
The primary purposes of the Plan are to:
-- provide for the continued operation and renewed growth of
the Debtors' businesses;
-- rationalize the Debtors' debt structure by satisfying the
senior lender claims through a new term loan facility and
the issuance of 100% of the equity in the Reorganized OCA to
the senior lenders (subject to the dilution by the
Management Incentive Plan and the Doctors' Incentive Plan);
-- provide for $10 million in exit financing to repay the DIP
Facility, pay the expenses of the bankruptcy cases and the
allowed claims against the Debtors and to provide additional
working capital for the Debtors' businesses;
-- provide for new senior management and ownership of the
Debtors; and
-- provide distributions to holders of allowed claims and
potential distributions to holders of equity interests and
subordinated claims.
Debt and Capital Structure Under the Plan
The Senior Lender will be issued 100% of the New Common Stock in
the Reorganized OCA (subject to the dilution by the Management
Incentive Plan and the Doctors' Incentive Plan) and will receive
ratable interests in the New Term Loan Facility in satisfaction of
the Senior Lender Claims.
The holders of Allowed General Unsecured Claims share ratably in:
(1) the General Unsecured Claims Pool, consisting of $3,000,000
deposited by the Reorganized Debtors in the Unsecured
Creditors' Trust;
(2) several potential General Unsecured Deferred Payments
(consisting of possible payments by the Reorganized
Debtors to the Unsecured Creditors' Trust) upon the
Reorganized Debtors achieving certain financial milestones;
and
(3) the Transferred Avoidance Action Proceeds (consisting of
the net proceeds from the Transferred Avoidance Actions).
Depending on the amount of General Unsecured Claims that are
ultimately Allowed, and the Reorganized Debtors' performance,
Holders of Allowed General Unsecured Claims could conceivably
receive as much as 100% of the amount of their Allowed General
Unsecured Claims over time, but will in no instance receive more
than a full recovery on account of their Allowed General Unsecured
Claims, exclusive of interest accruing after the Debtors'
bankruptcy filing.
The existing common, and preferred, stock and any options in OCA
will be canceled. However, if the classes comprising Equity
Interests and Subordinated Claims vote to accept the Plan, the
existing stockholders, together with the holders of allowed
Subordinated Claims will receive Equity and Subordinated Claims
Deferred Payments, which are potential payments (not securities)
based on the Reorganized OCA achieving certain milestones in the
future including the payment in full of Allowed General Unsecured
Claims. The Reorganized Debtors will make Equity and Subordinated
Claims Deferred Payments, if any, to the Equity and Subordinated
Claims Trust.
Exit Financing
The Senior Lenders will provide up to $10 million of exit
financing on the Effective Date of the Plan to repay the DIP
Facility incurred during the bankruptcy case, and to pay
administrative claims due to professionals and others, trade
creditors and other general unsecured creditors, as well as to
provide working capital for the Reorganized Debtors.
Deadlines
Objections to the Plan and ballots should be filed and served by
August 28, 2006. Ballots will be tabulated by the voting agent
and the certification of ballots will be prepared and filed by
Sept. 1, 2006.
The Court will consider confirmation of the Plan beginning at
10:00 a.m. on Sept. 5, 2006. The confirmation hearing may be
continued after that from time to time.
A full-text copy of the Disclosure Statement is available for a
fee at:
http://www.researcharchives.com/bin/download?id=060725223228
About OCA
Based in Metairie, Louisiana, OCA, Inc. -- http://www.ocai.com/
-- provides a full range of operational, purchasing, financial,
marketing, administrative and other business services, as well
as capital and proprietary information systems to approximately
200 orthodontic and dental practices representing approximately
almost 400 offices. The Debtor's client practices provide
treatment to patients throughout the United States and in Japan,
Mexico, Spain, Brazil and Puerto Rico.
The Debtor and its debtor-affiliates filed for Chapter 11
protection on March 14, 2006 (Bankr. E.D. La. Case No.
06-10179). Three debtor-affiliates also filed for bankruptcy
protection on June 1, 2006 (Bankr. E.D. La. Case No. 06-10503).
William H. Patrick, III, Esq., at Heller Draper Hayden Patrick &
Horn, LLC, represents the Debtors. Patrick S. Garrity, Esq., and
William E. Steffes, Esq., at Steffes Vingiello & McKenzie LLC
represent the Official Committee of Unsecured Creditors. Carmen
H. Lonstein, Esq., at Bell Boyd & Lloyd LLC and Robin B. Cheatham,
Esq., at Adams and Reese LLP represent the Official Committee of
Equity Security Holders. When the Debtors filed for protection
from their creditors, they listed $545,220,000 in total assets and
$196,337,000 in total debts.
OLESEN CONSTRUCTION: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------------
Debtor: Olesen Construction, Inc.
4N590 Pathfinder Drive
Elburn, Illinois 60119
Bankruptcy Case No.: 06-08795
Type of Business: The Debtor is a project contractor.
Chapter 11 Petition Date: July 24, 2006
Court: Northern District of Illinois (Chicago)
Judge: Pamela S. Hollis
Debtor's Counsel: Forrest L. Ingram, Esq.
Forrest L. Ingram, P.C.
79 West Monroe Street, Suite 1210
Chicago, Illinois 60603
Tel: (312) 759-2838
Fax: (312) 759-0298
Estimated Assets: $500,000 to $1 Million
Estimated Debts: $1 Million to $10 Million
Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Internal Revenue Service 941 Taxes $600,000
230 South Dearborn Street
Mail Stop 5010
Chicago, IL 60604
Chicago District Counsel of Alleged $280,000
Carpenters Contributions to
12 East Erie Street Employee Benefit
Chicago, IL 60611 Funds
IDES $126,823
Collections Section
33 South State Street
10th Floor
Chicago, IL 60603-2802
Geneva Independent Employee Alleged $103,000
Benefit Corp. Contributions to
28 North First Street Employee Benefit
P.O. Box 470 Funds
Geneva, IL 60134
Harris Bank $98,000
155 West Wilson Street
P.O. Box 189
Batavia, IL 60510
Midwest Siding Supply Supplies $82,148
Shelter Supplies $70,149
Harris Bank Business Loan $60,000
Illinois Department of Revenue Taxes $50,000
American Express Line of Credit $24,572
Muirfield Underwriters, Ltd. Workers' $18,022
Compensation Insurance
Harris Bank Business Loan $16,000
Assurance Agency Insurance $10,666
National Lift Truck Supplies $10,530
Air Fastening Systems, Inc. Supplies $9,980
Time-Savers, Inc. Supplies $9,400
O'Donnell Crane Supplies $8,367
First Equity Card Revolving Credit $6,238
Bradco Supply Supplies $6,113
Menards Revolving Credit $5,984
ONEIDA LTD: Has Until October 15 to Make Lease-Related Decisions
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
extended the period within which Oneida Ltd. and its debtor-
affiliates can assume, assume and assign or reject unexpired
non-residential real estate lease or executory contracts to
Oct. 15, 2006.
The Debtors sought the extension to ensure that:
(1) the Section 365(d)(4) deadline does not occur prior to the
chapter 11 plan's effective date; and
(2) there is sufficient time for the Debtors and other
interested parties to formulate and confirm an alternate
plan of reorganization, which could conceivably provide for
an alternative treatment of certain Leases, if the Plan is
not confirmed.
The Debtors have until Oct. 15 the exclusive right to file a Plan.
Confirmation hearings are still ongoing.
The Debtors have been at odds with the Official Committee of
Equity Security Holders on the valuation of the Debtors' estates
and the allowed claims of Pension Benefit Guaranty Corporation.
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.
PARMALAT GROUP: Parmalat Venezuela in Talks to Sell Two Plants
--------------------------------------------------------------
Parmalat S.p.A. confirmed in a press release that its subsidiary
Parmalat de Venezuela C.A. talked with the Venezuelan government
in June 2006 regarding the possible sale of two of the unit's
seven industrial plants.
Parmalat de Venezuela, in a communique delivered to El Universal
and its workers, suppliers, transportation contractors, cattle-
raisers and customers, said the negotiations started two years
ago and have now entered their final phase. Parmalat Venezuela
said it will advise the public "of the time when the sale of such
two plants is to take place, as well as of the terms of the
agreement," according to El Universal, citing the communique.
Bloomberg News, citing another report by El Universal, says the
parties have failed to agree on a price. The Venezuelan
government officials found Parmalat's price "too high."
According to Reuters, the Venezuelan government wants to use the
two plants -- one located in Machiques, Zulia state, the other in
Barquisimeto, Lara state -- for state-supported cooperatives
under a worker co-management model promoted as part of Venezuelan
President Hugo Chavez's socialist revolution for the poor.
Parmalat also clarifies that, contrary to reports in the
Venezuelan press, the government does not intend to acquire the
entire Venezuelan unit.
Parmalat says the unit is its most important business in the
Latin America region, generating EUR152.8 million revenues in
2005 and EUR43.5 million in the first quarter of 2006.
Headquartered in Wallington, New Jersey, Parmalat USA Corporation
-- http://www.parmalatusa.com/-- generates more than 7 billion
euros in annual revenue. The Parmalat Group's 40-some brand
product line includes milk, yogurt, cheese, butter, cakes and
cookies, breads, pizza, snack foods and vegetable sauces, soups
and juices and employs over 36,000 workers in 139 plants located
in 31 countries on six continents. The Company filed for chapter
11 protection on February 24, 2004 (Bankr. S.D.N.Y. Case No.
04-11139). Gary Holtzer, Esq., and Marcia L. Goldstein, Esq., at
Weil Gotshal & Manges LLP, represent the Debtors. When the U.S.
Debtors filed for bankruptcy protection, they reported more than
$200 million in assets and debts. The U.S. Debtors emerged from
bankruptcy on April 13, 2005. (Parmalat Bankruptcy News, Issue
No. 74; Bankruptcy Creditors' Service, Inc., 215/945-7000)
PARMALAT USA: U.S. Debtors Balk at Two New Jersey Claims
--------------------------------------------------------
On August 11, 2004, the State of New Jersey Department of the
Treasury, Division of Taxation, filed Claim No. 876 for
$1,746,730 against Parmalat USA Corp. and Farmland Dairies LLC.
New Jersey later filed Claim No. 1003 amending Claim No. 876.
New Jersey asserted a $458,0798 unsecured priority claim against
both Debtors.
At the U.S. Debtors' request, the U.S. Bankruptcy Court for the
Southern District of New York disallowed Claim No. 876
in its entirety and deemed Claim No. 1003 as an unsecured
priority claim for $458,079 against Farmland.
Subsequently, New Jersey filed two unsecured priority claims,
each against Farmland and Parmalat USA:
1. Claim No. 1035, amending Claim No. 1003, for $373,707; and
2. Claim No. 1034, amending Claim No. 1035, for $429,341.
On February 14, 2006, New Jersey filed Claim No. 1041 as a
general unsecured claim for $115,117 against Farmland and
Parmalat USA. New Jersey also filed Claim No. 1042, amending
Claim No. 1034, as an unsecured priority claim for $306,522
against both of the U.S. Debtors.
On April 17, 2006, the Debtors and New Jersey entered into a
stipulation, which the Court later approved, agreeing that
Claim Nos. 876, 1003, 1034 and 1035 are to be disallowed in their
entirety.
Against this backdrop, the U.S. Debtors ask the Court to disallow
Claim Nos. 1041 and 1042 against Parmalat USA. The U.S. Debtors
assert that Parmalat USA is not liable for the two Claims. The
Claims should have been asserted against Farmland only, James M.
Sullivan, Esq., at McDermott Will & Emery LLP, in New York,
argues.
The U.S. Debtors further ask the Court to disallow Claim No. 1042
against Farmland.
According to Mr. Sullivan, Farmland is entitled to a tax refund
from New Jersey for income taxes paid in the amount of at least
$184,676 on account of income earned in 2000. Since New Jersey
has not paid to Farmland the refund to which it is entitled,
Claim No. 1042 should be disallowed.
New Jersey Responds
The Debtors have not set forth one factual or legal contention to
support that there is a refund owed to Farmland that has not been
issued by the New Jersey Division of Taxation, Deputy Attorney
General of New Jersey Tracy E. Richardson, Esq., argues.
Mr. Richardson tells the Court that pursuant to the Division's
records, a $407,690 refund for the 2000 tax year was issued to
Farmland on April 25, 2002. No additional refund is due.
The Debtors, Mr. Richardson continues, have provided no
documentation to support their objection that some additional
refund is due and owing based on any timely request pursuant to
State statutes.
Hence, New Jersey believes that the Debtors fail to overcome the
prima facie validity of New Jersey's Claim as required by Rule
3001 of the Federal Rules of Bankruptcy Procedure.
New Jersey asks the Court to allow Claim No. 1042 for $306,522 as
against Farmland.
Because of the absence of a substantive objection to Claim No.
1041, New Jersey further asks the Court to allow the Claim as
against Farmland.
New Jersey agrees to the disallowance of Claim Nos. 1041 and 1042
as against Parmalat USA.
Headquartered in Wallington, New Jersey, Parmalat USA Corporation
-- http://www.parmalatusa.com/-- generates more than 7 billion
euros in annual revenue. The Parmalat Group's 40-some brand
product line includes milk, yogurt, cheese, butter, cakes and
cookies, breads, pizza, snack foods and vegetable sauces, soups
and juices and employs over 36,000 workers in 139 plants located
in 31 countries on six continents. The Company filed for chapter
11 protection on February 24, 2004 (Bankr. S.D.N.Y. Case No.
04-11139). Gary Holtzer, Esq., and Marcia L. Goldstein, Esq., at
Weil Gotshal & Manges LLP, represent the Debtors. When the U.S.
Debtors filed for bankruptcy protection, they reported more than
$200 million in assets and debts. The U.S. Debtors emerged from
bankruptcy on April 13, 2005. (Parmalat Bankruptcy News, Issue
No. 74; Bankruptcy Creditors' Service, Inc., 215/945-7000)
PERSISTENCE CAPITAL: Ch. 11 Trustee Wants Case Converted to Ch. 7
-----------------------------------------------------------------
David Hahn, the Chapter 11 trustee appointed in Persistence
Capital LLC's bankruptcy case, asks the U.S. Bankruptcy Court for
the Central District of California to convert the Debtor's case
into a liquidation proceeding under Chapter 7 of the Bankruptcy
Code.
The Trustee believes the only remaining significant assets of the
estate are:
a) potential interests in certain life insurance policies and
death benefits issued by Transamerica Insurance & Investment
Group; and
b) fraudulent conveyance and other claims against the Debtor,
certain insiders of the Debtor, and other third parties.
The value of these assets are currently unknown.
Steven J. Schwartz, at Danning, Gill, Diamond & Kollitz, in Los
Angeles, California, tells the Court that the Debtor's bankruptcy
schedules indicate that it holds a license for certain
intellectual property with a market value of $62.5 million.
However, The Trustee says that he has not seen any evidence that
the $62.5 million estimate is a fair assessment of the value of
any intellectual property in the possession of the Debtor, or any
form of patent, copyright, trademark or other recorded forms of
intellectual property that the Debtor owns.
Mr. Schwartz points out that there appears to be no readily
available assets with which to promulgate a plan of
reorganization, and no true operations to reorganize. He says
that a plan confirmation process would only add considerable cost
to completing the estate's liquidation and would not lead to any
greater recovery for creditors.
Moreover, the Trustee is informed that Robert A. Coberly, Jr., the
managing member of the Debtor who signed its bankruptcy petition,
has been arrested in connection with an alleged Ponzi scheme that
defrauded investors of over $70 million.
For these reasons, the Trustee believes that the liquidation of
the Debtor's estate can be completed more efficiently under a
chapter 7 proceeding, and that dismissal would be contrary to the
best interests of creditors.
The Court will convene a hearing at 10 a.m., on Aug. 1, 2006, to
consider the Trustee's request.
Based in Westlake Village, California, Persistence Capital LLC --
http://persistencecapitalllc.com/-- filed a voluntary chapter 11
petition on Sept. 13, 2005 (Bankr. C.D. Calif. Case No. 05-16450).
Lawrence R. Young, Esq., in Downey, California, represents the
Debtor in its restructuring proceedings. David Hahn, the Court-
appointed Chapter 11 trustee, is represented by Steven J.
Schwartz, at Danning, Gill, Diamond, and Kollitz, in Los Angeles,
California. When the Debtor filed for protection from its
creditors, it listed $85,000,000 in total assets and $28,602,241
in total debts.
PREFERREDPLUS TRUST: Cooper Tire Action Cues S&P's Negative Watch
-----------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB' rating on the
$31.2 million corporate bond-backed certificates issued by
PreferredPLUS Trust Series CTR-1 on CreditWatch with negative
implications.
The CreditWatch placement reflects the July 20, 2006, placement of
the rating on the underlying securities, the $225 million 8.00%
notes due Dec. 15, 2019, issued by Cooper Tire & Rubber Co., on
CreditWatch negative.
PreferredPLUS Trust Series CTR-1 is a swap-independent synthetic
transaction that is weak-linked to the underlying collateral, the
$225 million Cooper Tire & Rubber Co. 8.00% notes.
PRESIDENT CASINOS: Equity Deficit Widens to $8.69 Mil. at May 31
----------------------------------------------------------------
President Casinos Inc. incurred an $876,000 net loss for the
quarter ending May 31, 2006, the Company disclosed in a Form 10-Q
filing delivered to the Securities and Exchange Commission on
July 19, 2006.
As of May 31, 2006, the Company's balance sheet showed assets
totaling $64,994,000 and debts amounting to $73,686,000. At
May 31, 2006, the Company's equity deficit widened to $8,692,000
from a $7,816,000 deficit at May 3, 2005.
Liquidity
The Company's management believes the Company's liquidity and
capital resources will be sufficient to maintain its current
operations until its St. Louis operations are sold. However,
costs previously incurred and which will be incurred in the future
in connection with restructuring the Company's debt obligations
and the bankruptcy proceedings have been and will continue to be
substantial and, in any event, there can be no assurance that the
Company will be able to successfully restructure its indebtedness
or that its liquidity and capital resources will be sufficient to
maintain its normal operations during the restructuring period.
If the sale of the Company's St. Louis operations to Pinnacle
Entertainment, Inc., is consummated under the agreed upon terms,
the Company would not have any current ongoing business
operations. In the event that following the sale the Company's
remaining assets, including any litigation recoveries to which the
Company may be entitled, are not sufficient to discharge its
indebtedness and other liabilities and the Company or a third
party is unable to confirm an alternative plan of reorganization,
the Company may be forced to liquidate. At this time management
of the Company is unable to predict with certainty whether the
sale of its St. Louis operations to Pinnacle will be consummated
under the agreed upon terms, or whether any alternative plan of
reorganization for the Company will be proposed.
Default
As a result of the Company's high degree of leverage and the need
for significant capital expenditures at its St. Louis property,
the Company was unable to make the regularly scheduled interest
payments of $6.4 million that were each due and payable March 15
and September 15, 2000. Under the Indentures pursuant to which
the Senior Exchange Notes and Secured Notes were issued, an Event
of Default occurred on April 15, 2000, and is continuing.
Additionally the Company did not pay the $25 million principal
payment due September 15, 2000 on the Senior Exchange Notes. The
holders of at least 25% of the Senior Exchange Notes and Secured
Notes were notified and instructed the Indenture Trustee to
accelerate the Senior Exchange Notes and Secured Notes and on
August 11, 2000, the holders declared the unpaid principal and
interest to be due and payable. As of May 31, 2006, principal due
on the Senior and Secured Notes was $46 million and $14.7 million.
The Company's St. Louis operations require approximately
$4 million to fund daily operations. As of May 31, 2006, the St.
Louis operations had $27.9 million of non-restricted cash. The
Company also had $3 million in cash included in discontinued
operations. The Company is heavily dependent on cash generated
from operations to continue to operate as planned and to make
capital expenditures. Management anticipates that its existing
available cash and cash equivalents and its anticipated cash
generated from operations will be sufficient to fund its ongoing
operations, but not service its debt. Effective July 11, 2002,
interested on the Senior Exchange Notes and Secured Notes ceased
to accrue due to the Noteholders being deemed to be under secured.
To the extent cash generated from operations is less than
anticipated, the Company may be required to curtail certain
planned expenditures.
The Company's management expresses substantial doubt about the
Company's ability to continue as a going concern, saying that the
continuation of the Company as a going concern is contingent upon,
among other things, its ability to formulate a reorganization
which will gain approval of the requisite parties under the
Bankruptcy Code and confirmation by the Bankruptcy Court, its
ability to return to profitability, generate sufficient cash flows
from operations and obtain financing sources to meet future
obligations.
A full-text copy of the regulatory filing is available for free at
http://ResearchArchives.com/t/s?e53
About President Casinos
Headquartered in St. Louis, Missouri, President Casinos Inc. --
http://www.presidentcasino.com/-- currently owns and operates a
dockside gaming casino in St. Louis, Missouri through its wholly
owned subsidiary, President Missouri. The Debtor filed for
chapter 11 protection on June 20, 2002 (Bankr. S.D. Miss. Case No.
02-53055). On July 11, 2002, substantially all of Debtor's other
operating subsidiaries filed for chapter 11 protection in the same
Court. The Honorable Judge Edward Gaines ordered the transfer of
President Casino's chapter 11 cases from Mississippi to Missouri.
The case was reopened on Nov. 5, 2002 (Bankr. E.D. Mo. Case No.
02-53005). Brian Wade Hockett, Esq., at Hockett Thompson Coburn
LLP, represents the Debtors in their restructuring efforts. David
A. Warfield, Esq., at Blackwell Sanders Peper Martin LLP,
represents the Official Committee of Unsecured Creditors.
PTC ALLIANCE: Emerges from Chapter 11 Protection
------------------------------------------------
PTC Alliance Corp. completed the necessary steps to implement its
Prepackaged Plan of Reorganization and successfully emerged from
Chapter 11 on July 25, 2006.
At a hearing held on July 13, 2006, in Pittsburgh, the Hon. Thomas
P. Agresti of the U.S. Bankruptcy Court for the Western District
of Pennsylvania ruled that PTC Alliance had met all of the
necessary statutory requirements to confirm its Plan, which was
filed with the Court on May 10, 2006, in conjunction with PTC
Alliance's voluntary Chapter 11 petition.
Terms of the Reorganization Plan
Under the Prepackaged Plan of Reorganization, PTC Alliance's
senior lenders exchanged their prepetition debt for all of the
equity in the reorganized company. In addition, the company's
senior lenders agreed to provide PTC Alliance with a $70 million
exit financing credit facility to fund the company's operations
upon emergence from Chapter 11.
"This is an exciting day for PTCAlliance," said Peter Whiting,
Chairman and Chief Executive Officer of PTCAlliance. "Today we
have officially completed our Chapter 11 restructuring. We emerge
with a greatly de-leveraged balance sheet and a capital structure
that is more appropriate for the cyclical nature of our business.
We also have significant cash resources to allow the company to
make the necessary investments in developing and growing our
business."
"We completed this Chapter 11 restructuring in less than three
months," Mr. Whiting said. "We could not have done this so
efficiently and with minimal disruption to our business without
the outstanding effort of our employees, the senior management
team, our Board of Directors, our senior lenders and our outside
professionals -- led by Eric Schaffer of the law firm of Reed
Smith LLP. I am grateful for the outstanding work done by all
those groups."
"In the period leading up to the prepackaged Chapter 11 filing and
in recent months we have seen increased demand for product in most
of our major markets," Mr. Whiting said. "Our customers and
suppliers have given us great support during our restructuring and
as a result we have been able to operate under normal conditions.
We remain focused on continuing to improve our customer service
and, with our improved balance sheet, we intend to continue to
grow our business."
About PTC Alliance Corp.
Headquartered in Wexford, Pennsylvania, PTC Alliance Corp. --
http://www.ptcalliance.com/-- manufactures and markets welded and
cold drawn mechanical steel tubing and tubular shapes, chrome
plated bar products, fabricated parts, and precision components.
The company filed for chapter 11 protection on May 10, 2006
(Bankr. W.D. Pa. Case No. 06-22110). Eric A. Schaffer, Esq., at
Reed Smith LLP, represents the Debtor in its restructuring
efforts. No Official Committee of Unsecured Creditors has been
appointed in the Debtor's bankruptcy proceedings. When the Debtor
filed for protection from its creditors, it estimated assets and
debts of more than $100 million.
QUAIL MARKETING: Case Summary & Six Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Quail Marketing LLC
aka Quail Ridge Marketing
348 Morningstar Lane
Lafayette, Colorado 80026
Bankruptcy Case No.: 06-14720
Chapter 11 Petition Date: July 7, 2006
Court: District of Colorado (Denver)
Judge: Michael E. Romero
Debtor's Counsel: Christian C. Onsager, Esq.
Onsager, Staelin & Guyerson, LLC
1873 South Bellaire Street, Suite 1401
Denver, Colorado 80222
Tel: (303) 512-1123
Estimated Assets: $1 Million to $10 Million
Estimated Debts: $1 Million to $10 Million
Debtor's Six Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
City of Longmont Development $144,167
Community Development and Agreement
Planning Division
Civic Center Complex
Longmont, CO 80501
Schuck Communities, Inc. $110,000
2 North Cascade Avenue
Suite 1280
Colorado Springs, CO 80903-1631
Flatirons Bank $55,832
5400 Mount Meeker Road
Boulder, CO 80301
Boulder County Assessor $51,000
Park Engineering Consultants $32,641
Expert Excavating and Haul $5,320
QUEST MINERALS: Inks Debt Restructuring Pact with Noteholders
-------------------------------------------------------------
Quest Minerals & Mining Corp. reached, on July 24, 2006,
agreements with a group of noteholders representing approximately
$1,050,000, or 74%, of its 7% convertible secured promissory notes
due February 2006 on a financial structuring that reduces
approximately $125,000 of debt and extends the maturity of the
remaining notes to February 2007.
The debt restructuring is a significant step in Quest's ongoing
initiative to resolve its debt and improve its financial
liquidity. Through this initiative, Quest intends to regain its
financial health by restructuring its highly leveraged balance
sheet. By this restructuring, the company has restructured the
majority of the privately held debt of Quest Minerals & Mining
Corp., which is a parent holding company without business
operations of its own. The company is continuing its efforts to
restructure the privately held debt of Gwenco, Inc., the company's
operating subsidiary. Quest re-emphasized that this intended
financial restructuring is being designed to allow the company to
resume operations at the Pond Creek mine at Slater's Branch as
well as pursue other energy related opportunities.
As part of the restructuring agreements, the group of noteholders
agreed to amend and restate the convertible notes to extend the
maturity dates to March 2007. In addition, the company and the
noteholders resolved several disputes arising out of the note
transactions, including terms of conversion, exercisability of
warrants, and registration rights.
"We believe that the restructuring of these convertible notes is a
major milestone for Quest in our ongoing restructuring initiative,
and we are continuing to work on restructuring the balance of our
debt," Eugene Chiaramonte, Jr., President of Quest, said. "We
continue to believe that a restructured balance sheet and an
infusion of short-term working capital will allow us to obtain all
required regulatory approvals and recommence mining operations at
the Pond Creek mine at Slater's Branch. We also believe that it
would allow us to pursue other energy related opportunities to
enhance stockholder value and also create more jobs in the region.
We estimate that we have total recoverable coal reserves of nine
million tons, consisting of both proven and probable reserves, and
that a restructuring would allow us to recommence mining
operations to service our debt obligations and to enhance our
results of operations.
"We continue to believe that this ongoing restructuring initiative
is in the company's and the local community's best interests, will
provide a level of debt that our operations can be expected to
support, and enhance the prospects of a stronger Quest tomorrow.
We appreciate the cooperation that our noteholders have shown in
concluding this portion of the restructuring, and we thank them
for their continued support of our company."
A full-text copy of the Restructuring Agreement is available for
free at: http://ResearchArchives.com/t/s?e60
About Quest Minerals & Mining
Based in Paterson, New Jersey, Quest Minerals & Mining Corp.
(OTC BB:QMMG.OB) -- http://www.questminerals.com/-- acquires and
operates energy and mineral related properties in the southeastern
part of the United States. Quest focuses its efforts on
properties that produce quality compliance blend coal.
At March 31, 2006, the Company's balance sheet showed total assets
of $6,776,800 and total liabilities of $7,368,152, resulting in a
stockholders' deficit of $591,352.
REMOTE DYNAMICS: Posts $2.7 Mil. Net Loss in Quarter Ended May 31
-----------------------------------------------------------------
Remote Dynamics, Inc., fka Minorplanet Systems USA, Inc., incurred
a $2,724,000 net loss on $1,339,000 of revenues for the third
fiscal quarter ending May 31, 2006. This operating result was
disclosed in a Form 10-QSB filed with the Securities and Exchange
Commission on July 17, 2006.
As of May 31, 2006, the Company's balance sheet disclosed assets
amounting to $15,710,000, liabilities totaling $9,347,000 and a
$1,513,000 stockholders' equity.
Liquidity and Capital Resources
The Company incurred significant operating losses since its
inception and have limited financial resources to support the
business until such time that it is able to generate positive cash
flow from operations. The Company had cash and cash equivalents
of $1.4 million as of May 31, 2006. Based on its revised business
plan, including the closing of its Note and Warrant Purchase
Agreement on February 24, 2006, the Company's management currently
believes that the Company has sufficient capital to fund its
ongoing operations through the remainder of the fiscal year.
However, future cash flows will be dependent on its ability to
meet its sales and profitability goals as well as further reducing
the operating cost structure as planned during fiscal year 2006.
The Company's management said that the Company's existing cash
resources and projections for increased revenues for the remainder
of calendar year 2006 may not provide sufficient cash resources to
finance its operations and expected capital expenditures for the
next twelve months. It is likely that it will need to seek
additional debt or equity financing to fund its operations for the
next year. The sufficiency of its cash resources depends to a
certain extent on general economic, financial, competitive or
other factors beyond our control. Moreover, despite actions to
reduce costs and improve profitability, operating losses and net
operating cash outflows will continue through the end of calendar
year 2006. As a result, the Company may not be able to achieve
the revenue and gross margin objectives necessary to achieve
positive cash flow or profitability without obtaining additional
debt or equity financing.
Bankruptcy Warning
The Company does not currently have any arrangements for
additional financing and it may not be able to secure additional
debt or equity financing on terms when it needs such funding, the
Company's management added. Further, the Company's ability to
secure certain types of additional financings is restricted under
the terms of the Note and Warrant Purchase Agreement dated as of
Feb. 23, 2006. There can be no assurance that the Company will be
able to consummate a transaction for additional capital prior to
substantially depleting its available cash reserves, and its
failure to do so may force it to file for bankruptcy protection or
cease operations.
Going Concern Doubt
As reported in the Troubled Company Reporter on Dec. 29, 2005, BDO
Seidman LLP issued an audit report for the fiscal year ended
Aug. 31, 2005, which expressed an unqualified opinion but included
an explanatory paragraph concerning Remote Dynamics, Inc.'s
ability to continue as a going concern. The auditing firm cited
the company's history of recurring losses from operations and
negative cash flows from operating activities.
A full-text copy of the regulatory filing is available for free at
http://ResearchArchives.com/t/s?e47
Based in Richardson, Texas, Minorplanet Systems USA, Inc., nka
Remote Dynamics, Inc. -- http://www.minorplanetusa.com/--
develops and implements mobile communications solutions for
service vehicle fleets, long-haul truck fleets and other
mobile-asset fleets, including integrated voice, data and position
location services. Minorplanet, along with two affiliates, filed
for chapter 11 protection (Bankr. N.D. Texas, Case No. 04-31200)
on February 2, 2004. Omar J. Alaniz, Esq., and Patrick J.
Neligan, Jr., Esq., at Neligan Tarpley Andrews and Foley LLP,
represent the Debtors in their restructuring efforts. When
Minorplanet filed for bankruptcy, it estimated assets and debts at
$10 million to $50 million. The Court confirmed the Debtors'
Third Amended Joint Plan of Reorganization on June 17, 2004.
RENATA RESORT: Court Sets July 31 as Bar Date for Filing Claims
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Florida in
Panama City set July 31, 2006 as the deadline for all persons owed
money by Renata Resort LLC to file proofs of claim.
Proofs of claim must be filed with the Clerk of the Bankruptcy
Court at this address:
William W. Blevins
Clerk of Court
U.S. Bankruptcy Court
Northern District of Florida (Panama City)
Suite 100
110 E. Park Avenue
Tallahassee, FL 32301
Headquartered in Panama City, Florida, Renata Resort, LLC, fdba
Sunset Pier Resort, LLC, operates a hotel and resort. The company
filed for chapter 11 protection on May 31, 2006 (Bankr. N.D. Fla.
Case No. 06-50114). John E. Venn, Jr., Esq., at John E. Venn,
Jr., P.A., represents the Debtor in its restrucutring 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 $19,947,271 and total debts
of $8,524,196.
REXNORD CORP: S&P Holds Junk Rating on $785 Million Senior Notes
----------------------------------------------------------------
Standard & Poor's Ratings lowered its corporate credit rating on
Rexnord Corp. to 'B' from 'B+', and removed it from CreditWatch
with negative implications. The rating was placed on CreditWatch
on May 25, 2006, when equity sponsor Apollo Management LP
announced the acquisition of the Rexnord for $1.8 billion in a
leveraged transaction.
In addition, the 'B+' rating and '1' recovery rating on Rexnord's
senior secured credit facility were affirmed. Amounts under the
credit facility were modified to $150 million for the multi-year
revolving line of credit due 2012 and $610 million for the term
loan B due 2013.
Standard & Poor's also affirmed its 'CCC+' ratings on Rexnord's
$485 million of senior unsecured notes due 2014 and $300 million
senior subordinated notes due 2016, both of which were also
revised. The outlook is stable.
The lower corporate credit rating and resolution of the
CreditWatch are based on the consummation of refinancing
transactions Rexnord undertook to support Apollo Management's
acquisition of the company.
"The downgrade reflects increased leverage that resulted from the
transaction that has weakened Rexnord's financial profile, which
is only partially offset by the company's strong market position
and cash flow generation and its ability to generate recurring
revenue," said Standard & Poor's credit analyst Clarence Smith.
Milwaukee, Wisconsin-based Rexnord manufacturers a broad range of
mechanical power transmission components for the general
industrial markets.
RIEFLER CONCRETE: Can Loan Funds & Use Cash Collateral Until Sept.
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of New York
allowed Riefler Concrete Products, LLC, and its debtor-affiliates
to use cash collateral securing the repayment of their
indebtedness to a group of lenders headed by Wachovia Capital
Finance Corporation (New England) until Sept. 11, 2006. The Court
also gave the Debtors permission to borrow funds from the same
group of lenders to pay for any deficiency their cash might have.
The Debtors do not have the unencumbered funds necessary to pay
the costs and expenses required to facilitate the sale of
substantially all of their assets, including professional fees and
other costs of administration of the cases.
The Debtors will use the funds under a Court-approved budget.
A copy of the Budget is available for free at:
http://ResearchArchives.com/t/s?e5b
Bruce F. Smith, Esq. at Jager Smith P.C., in Manhattan, told the
Court that before the Debtors filed for bankruptcy, they entered
into a secured financing agreement with the Wachovia Lender Group
providing for:
(a) an $8-million revolving facility;
(b) a $4-million term loan facility; and
(c) a $3-million term loan facility,
Wachovia asserted the Debtors were indebted to it as of the
bankruptcy filing in the amount of $5,376,488. Hilco Capital,
L.P., a lender, also asserted that the Debtors were indebted to it
as of June 12, 2006, in the amount of $2,295,121.
The Court granted the Wachovia Lender Group, as prepetition
lender, a replacement lien with the same extent, validity and
priority as the prepetition lien.
The Court granted the Wachovia Lender Group, as debtor-in-
possession lender, an allowed superpriority administrative claim
under Sections 364(c)(1) and 507(b).
To protect against any diminution in the value of its interest
owing the Debtors' use of its prepetition collateral, the Wachovia
Lender Group, as prepetition lender, will also be granted a
replacement security interest in and lien upon all of the Debtors'
assets subject only to the security interests and liens granted
for the DIP lenders and a carve-out.
Headquartered in Hamburg, New York, Riefler Concrete Products, LLC
-- http://www.riefler.com/-- manufactures and distributes
licensed concrete masonry products, and offers concrete
construction and filling services. The Company and its affiliate,
Riefler Real Estate Corp., filed for chapter 11 protection on
June 12, 2006 (Bankr. W.D. N.Y. Case No. 06-01574). Bruce F.
Smith, Esq., at Jager Smith P.C., represent the Debtors in their
restructuring efforts. When they filed for bankruptcy, the
Debtors reported assets and debts amounting between $10 million to
$50 million.
SAINT VINCENTS: Judge Hardin Approves Hospital Sale to Bayonne
--------------------------------------------------------------
The Honorable Adlai S. Hardin Jr. of the U.S. Bankruptcy Court for
the Southern District of New York grants the sale of St. Vincent's
Hospital, Staten Island, to Castleton Acquisition Corporation, an
affiliate of Bayonne Medical Center. All objections that have not
been withdrawn, waived, or settled are overruled on the merits,
with prejudice.
The material terms of the Purchase Agreement are:
(a) Consideration:
-- $15,000,000 in cash less the $1,000,000 Deposit
-- assumption of certain liabilities
-- payment of cure amounts
(b) The Purchased Assets include:
-- the Hospital and all related facilities;
-- inpatient and outpatient programs related to
behavioral health and endoscopy services located at
Beyley Seton Hospital, as well as other programs and
clinics related to Bayley Seton;
-- research programs;
-- the Debtors' interest in The Heart Institute;
-- the Hospital's Medicare and Medicaid provider numbers
and related provider agreements; and
-- related contracts.
(c) The Assumed Liabilities include:
-- liabilities related to the Business, up to a maximum
of $10,000,000 less Cure Amounts payable or reserved
by Castleton;
-- $2,500,000 in postpetition accounts payable existing
on the Closing Date that were incurred in the ordinary
course of business, and not paid by the Debtors in the
ordinary course of business as of the Closing Date;
-- all liabilities related to the Hospital's Medicare and
Medicaid provider numbers or related provider
agreements, subject to agreements with the Department
of Health and Human Services;
-- liabilities and obligations related to a resolution
agreement with the New York State Attorney General's
Office;
-- 50% of transfer taxes, if any, related to the Sale;
-- liabilities accruing from and after the Closing Date
with respect to the Assumed Contracts and Leases; and
-- employee-related liabilities.
The Debtors will retain all liabilities that are not
assumed in the Purchase Agreement.
(d) Castleton will pay for all Cure Amounts related to the
Assumed Contracts and Leases up to a maximum aggregate
amount of 110% of the total Cure Amounts. The total Cure
Amounts is currently estimated at $2,714,516. Any Cure
Amounts paid by Castleton will count towards the
$10,000,000 maximum amount of the Assumed Liabilities.
(e) The Debtors will provide services to Castleton for a
period of six months after the closing date of the Sale
on a cost reimbursement basis. Castleton will have the
option to extend its use of the services for an
additional six months. Castleton will also pay the
Debtors for services rendered and medicine, drugs, and
supplies provided on or before the Closing Date, to
patients who are discharged after the Closing Date.
(f) The Debtors will pay to Castleton the proceeds from the
first $17,500,000 of accounts receivable existing on the
Closing Date.
(g) Castleton will place $1,000,000 in escrow within two
business days after execution of the Purchase Agreement.
The Debtors will be entitled to keep the Deposit should
they terminate the Purchase Agreement due to a material
breach by Castleton.
(h) The Debtors agree that, for five years after the Closing
Date, they will not own or operate any hospital or
healthcare facility in Staten Island that is required to
be licensed under the New York Public Health Law or the
New York Mental Hygiene Law, or sponsor any controlled
professional corporation in Richmond County, except for
their existing operations and private practices operated
by their staff and affiliated physicians. The Debtors
also agree not to solicit any of Castleton's employees
for three years after the Closing Date.
(i) After the Closing Date, all representations and
warranties made by the parties related to the Purchase
Agreement will survive for a period of six months. The
Debtors' representations and warranties related to:
-- compliance with medical reimbursement program laws
will survive for 12 months; and
-- employees and environmental matters will survive for
15 months.
All indemnification claims are subject to an aggregate
limit of $2,500,000 and an aggregate deductible amount of
$250,000.
A full-text copy of the Debtors' Purchase Agreement with Castleton
is available for free at http://ResearchArchives.com/t/s?e63
Court's Ruling
Judge Hardin rules that except as otherwise provided in the
Purchase Agreement:
* upon the Closing, the Purchased Assets will be transferred
to the Purchaser free and clear of all Liens, with all the
Liens to attach to the net proceeds of the Sale Transaction
in the order of their priority, with the same validity,
force and effect which they now have as against the
respective Purchased Assets, subject to any claims and
defenses, setoffs or rights of recoupment the Debtors may
possess;
* all persons and entities holding Liens against, in or with
respect to the Debtors and the Purchased Assets in any way
relating to, the Debtors, the Purchased Assets, the
operation of the Debtors' business prior to the Closing, or
the transfer of the Purchased Assets to the Purchaser, are
forever barred, estopped, and permanently enjoined from
asserting their Liens against the Purchaser and its
affiliates; and
* effective upon the Closing, the Purchaser will have no
liability for any Claims against the Debtors or their
estates.
"The transfer of the Purchased Assets to the Purchaser pursuant to
the Purchase Agreement constitutes a legal, valid, and effective
transfer of the Purchased Assets, and shall vest the Purchaser
with all right, title, and interest of the Debtors in and to the
Purchased Assets," says Judge Hardin.
The Debtors are authorized and directed to assign all State and
federal provider numbers, licenses and permits used in connection
with the Purchased Assets to the Purchaser in accordance with the
terms of the Purchase Agreement.
Upon the Closing, all of SVCMC's interests in the Heart Institute
and in the Heart Institute Contracts will be assigned to the
Purchaser in accordance with the terms of the Purchase Agreement,
as modified by the Settlement Agreement and the Related Agreement.
Furthermore, the Court decrees that:
-- the Debtors will not sell or transfer any Purchased Assets
that are subject to a lien or security interest in favor of
General Electric Capital Corporation unless
(a) GE Capital has consented to the sale or transfer;
(b) the Court enters a subsequent order, upon notice to GE
Capital, authorizing the Debtors to make the sale or
transfer; or
(c) GE Capital's consent is not required for the sale or
transfer under the GE Capital Financing Agreements.
-- the Medicare provider agreements and provider numbers of
the Purchase Agreement will not be assumed and assigned to
Purchaser unless and until SVCMC, the Purchaser, and the
United States Department of Health and Human Services has
entered into the Medicare Agreement contemplated by the
Purchase Agreement;
-- SVCMC will pay any outstanding water and sewer charges
relating to the Purchased Assets owed to the City of New
York prior to or at Closing; provided, that the Court will
retain jurisdiction to determine the amounts if the City of
New York and SVCMC are unable to agree on them;
-- no assets owned by Computer Sciences Corporation and used
by CSC and the Debtors in connection with CSC's provision
of services under the Information Technology Service
Agreement dated April 2, 2001, are being sold or
transferred to the Purchaser. Neither the Purchase
Agreement nor the entry of the Order will modify or alter
in any respect any of the rights that CSC may have under
the CSC Agreement; and
-- with respect to any contracts between the Seller and the
New York City Department of Health and Mental Hygiene
listed on the Assumption Schedule, the Seller and the
Purchaser agree to take all necessary steps to obtain, as a
condition to assumption and assignment of the DHMH
Contracts to the Purchaser at Closing, all necessary
regulatory approvals from the New York State Department of
Health, the State Office of Mental Health and the State
Office of Alcoholism and Substance Abuse Services, and the
consent in writing of DHMH.
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.
SEPRACOR INC: Balance Sheet Upside-Down by $109 Million at June 30
------------------------------------------------------------------
Sepracor Inc. reported $264.4 million consolidated revenues for
the three months ended June 30, 2006, of which revenues from
pharmaceutical product were $256.4 million compared to
consolidated revenues of $185.1 million, with $166.7 million
revenues from pharmaceutical product, for the same period in 2005.
The Company also reported net income for the second quarter of
2006 of approximately $11.3 million versus a net loss of $7.4
million for the three months ended June 30, 2005. The reported
results for the second quarter of 2006 included charges of $10.6
million for stock-based compensation.
The Company further reported six months ended June 30, 2006
consolidated revenues of $550.1 million, of which revenues from
pharmaceutical product sales were $533.9 million, and net income
of approximately $21.5 million compared to consolidated revenues
of $304.1 million with $273.4 million revenues from pharmaceutical
product and a net loss of $30.0 million for the six months ended
June 30, 2005. The reported results for the first six months of
2006 included charges of $20.4 million for stock-based
compensation.
As of June 30, 2006, the Company had approximately $944.5 million
in cash and short- and long-term investments.
At June 30, 2006, the Company's balance sheet showed a
stockholders' deficit of $109,459,000 million compared to a
$165,489,000 million deficit at Dec. 31, 2005.
Headquartered in Marlborough, Massachusetts, Sepracor Inc.
(Nasdaq: SEPR) -- http://www.sepracor.com/-- is a research-based
pharmaceutical company specializing in the treatment and
prevention of human diseases. Sepracor's drug development program
has yielded a portfolio of pharmaceutical products and candidates
with a focus on respiratory and central nervous system disorders.
* * *
Sepracor's long-term local and foreign issuer credits carry
Standard & Poor's B+ rating. The ratings were placed on Feb. 13,
2006 with a positive outlook.
SIRIUS SATELLITE: FCC Reviewing FM Transmitters' Compliance
-----------------------------------------------------------
Sirius Satellite Radio Inc. reported that two manufacturers of
Sirius radios and its principal competitor had received inquiries
from the Federal Communications Commission as to whether the FM
transmitters in their products complied with the FCC's emissions
and frequency rules.
The Company began an internal review of the compliance of the FM
transmitters in a number of its radios.
The Company disclosed that its internal review determined that
certain of its radios with FM transmitters were not compliant with
FCC rules. It has taken a series of actions to evaluate, mitigate
and correct the problem. It also directed manufacturers of Sirius
radios with FM transmitters to suspend manufacture and shipment to
retailers of non-compliant devices and to make the necessary
changes in production to bring the radios into compliance.
The Company further disclosed that the FCC is continuing its
review of its products as well as products of other companies
containing FM transmitters.
The Company also disclosed that no health or safety issues are
involved with the Sirius radios.
Headquartered in New York City, Sirius Satellite Radio Inc. --
http://www.sirius.com/-- is the leading provider of sports radio
programming, broadcasting play-by-play action of more than 350 pro
and college teams. SIRIUS features news, talk and play-by-play
action from the NFL, NBA, NHL, Barclays English Premier League
soccer, the Wimbledon Championships and more than 125 colleges,
plus live coverage of several of the year's top thoroughbred horse
races. SIRIUS is the only radio outlet to provide listeners with
every NFL game, and airs over 1000 NBA games per season, plus up
to 40 NHL games per week. SIRIUS also features programming from
ESPN Radio and ESPNews.
Sirius Satellite Radio Inc.'s 2-1/2% Convertible Notes due 2009
carry Standard & Poor's CCC rating.
SPARKLE SPRING: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Sparkle Spring Water, Inc.
P.O. Box 189
Crandall, Georgia 30705
Bankruptcy Case No.: 06-41272
Type of Business: The Debtor sells and distributes
bottled mineral water. See
http://www.sparklespringwater.com/
Chapter 11 Petition Date: July 24, 2006
Court: Northern District of Georgia (Rome)
Debtor's Counsel: Leon S. Jones, Esq.
M. Denise Dotson, Esq.
Jones & Walden, LLC
21 Eighth Street Northeast
Atlanta, Georgia 30309
Tel: (404) 564-9300
Fax: (404) 564-9301
Estimated Assets: $1 Million to $10 Million
Estimated Debts: $500,000 to $1 Million
Debtor's 20 Largest Unsecured Creditors:
Entity Claim Amount
------ ------------
Box 1 $85,000
1408 Coronet Drive
P.O. Box 882
Dalton, GA 30722
PrinTech Label Corp. $23,028
P.O. Box 2116
Smyrna, GA 30081-2116
CKS Packaging Inc. $22,419
P.O. Box 44386
Atlanta, GA 30336
Amaca Locks $20,300
[no address provided]
Severn Trent $13,000
2660 Columbia Street
Torrance, CA 90503
Chastain Concrete $11,700
Tally & Mullins $11,508
SMB Machinery Systems $11,245
Silgan Plastics $11,030
Triumbari Corporation $10,252
Avrett, Polmer & Withrock $7,742
Ozone Water Systems $6,996
Hill & Williams Bros. $6,668
Fedex Freight East $5,742
Alliance Printing $5,300
GoodPac Plastics $4,625
Apollo Textiles $4,328
Rhyne Packaging $4,160
Global Employment Solutions $3,639
American Transportation Systems $3,300
THERMADYNE HOLDINGS: Amends Financial Covenants With Lenders
------------------------------------------------------------
Thermadyne Holdings reported several items related to its delayed
financial filings.
The Company said it will restate prior financial statements for
the seven months ended Dec. 31, 2003, the twelve months ended
Dec. 31, 2004, each of the quarters in the year ended Dec. 31,
2004, and the first three quarters of 2005.
The restatement, including adjustments in accounting for income
taxes, foreign currency translation and the accounting of certain
foreign business units, and the reclassification of the financial
statement presentations, to separate the assets and the
liabilities and the results of operations of the discontinued
operations, have caused the delay in the Company's SEC filings.
The Company also disclosed that it reached an agreement with its
senior secured lender to extend its reporting requirements until
July 28, 2006 and also amended certain financial covenants.
The Company has also amended its agreement with its second-lien
secured lenders and as a result will receive an additional
$20 million, which will be used to repay an outstanding term loan
and a portion of a revolving credit facility with the senior
secured lender. The amendment also removed certain financial
covenants until the third quarter of 2007.
The Company has commenced consent solicitation to seek amendments
to the indenture governing its $175 million of 9-1/4% Senior
Subordinated Notes due 2014 and waiver of existing defaults
related to its failure to timely file the Company's 2005 Form 10-K
and first quarter 2006 Form 10-Q with the SEC.
The amendments will extend the time for filing these reports to
Aug. 21, 2006 and extend the time to file its second quarter 2006
Form 10-Q to Dec. 17, 2006. The amendment will also provide for
the payment of additional special interest on the Notes, initially
at a rate of 1.25% per annum and for the payment of contingent
cash consent fees to consenting Note holders. The consent
solicitation will remain open until July 31, 2006.
Based in St. Louis, Missouri, Thermadyne Holdings Corporation
(Pink Sheets: THMD) -- http://www.Thermadyne.com/-- is a global
marketer of cutting and welding products and accessories under a
variety of brand names including Victor(R), Tweco(R), Arcair(R),
Thermal Dynamics(R), Thermal Arc(R), Stoody(R), and Cigweld(R).
* * *
As reported in the Troubled Company Reporter on March 21, 2006,
Moody's Investors Service placed Thermadyne Holdings Corporation's
Caa1 rating on $175 million 9.25% senior subordinated notes, due
2014, rated; and B2 Corporate Family Rating on review for possible
downgrade.
As reported in the Troubled Company Reporter on April 27, 2005,
Standard & Poor's Ratings Services lowered its corporate credit
rating on Thermadyne Holdings Corp. to 'B-' from 'B+', and
subordinated debt rating to 'CCC' from 'B-'. S&P assigned a
negative outlook at that time.
TOWER PARK: March 31 Balance Sheet Upside-Down by $5.2 Million
--------------------------------------------------------------
Tower Park Marina Investors, L.P., disclosed its financial results
for the first quarter ended March 31, 2006, to the Securities and
Exchange Commission on July 19, 2006.
For the three months ended March 31, 2006, the Company incurred a
$95,000 net loss on $459,000 of net revenues, compared to a
$209,000 net loss on $403,000 of net revenues in 2005.
At March 31, 2006, the company's balance sheet showed $3,342,000
in total assets and $8,620,000 in total liabilities, resulting in
a $5,278,000 stockholders' deficit.
A full-text copy of the Company's Quarterly Report is available
for free at http://researcharchives.com/t/s?e4a
Going Concern Doubt
Vasquez & Company LLP in Los Angeles, California, expressed
substantial doubt about Tower Park Marina's ability to continue as
a going concern after it audited the Company's financial statement
for the fiscal year ended Dec. 31, 2005. The auditing firm
pointed to the Company's failure to generate a satisfactory level
of cash flow. Cash flow projections do not indicate significant
improvement in the near term.
About Tower Park
Tower Park Marina is located in the Sacramento - San Joaquin Delta
near Sacramento, California. The partnership has been aggregated
into four reportable business segments: Slip rental; RV parking;
Retail sales; and Fuel services. Slip rental comprise the wet
boat slip rentals and dry boat storage operations at the marina.
RV parking represents both long term and transient recreational
vehicle parking at the campgrounds adjacent to the marina. Retail
sales segment consists of the operations of the retail boat supply
and sundries store at the marina. The Fuel service segment
reports the operations of the fuel dock at the marina.
UNITED ENERGY: Carl DelSignore Balks at Consolidation Proposal
--------------------------------------------------------------
The Carl DelSignore Family Trust asks the U.S. Bankruptcy Court
for the Northern District of West Virginia to deny the substantive
consolidation request Official Committee of Unsecured Creditors
appointed in Buffalo Coal Company, Inc.'s chapter 11 cases.
As reported in the Troubled Company Reporter on July 13, 2006,
Buffalo Coal's Committee asked the Court to substantively
consolidate the estates of Buffalo Coal and United Energy Coal,
Inc., pursuant to Section 105(a) of the Bankruptcy Code and
Bankruptcy Rule 1015. The Committee wants the two cases to be
consolidated under Buffalo Coal's chapter 11 case.
The Trust tells the Court that it does not dispute the allegations
that Gerald Ramsburg and Charles Howdershelt are the sole officers
and directors of Buffalo Coal and that in their individual
capacities, own United Energy.
The Trust however disputes the Committee's statements that:
* the Debtors operated as one company with two divisions;
* while the Debtors kept records of intercompany transfers and
related intercompany debts, reconciliation and repayment was
not adhered to nor were the debts memorialized by contracts,
promissory notes or other formal writings evidencing the
debt; and
* the Debtors share assets like equipment without entering
into intercompany lease agreements.
The Trust contends that based on the testimony of the Debtors'
officers at their respective Section 341(a) meetings, the Debtors
operated as separate and distinct companies. There were also
intercompany transactions although obligations due and owing to
each company were not paid, the Trust relates. The Trust further
says that the Debtors also kept records of the equipment shared.
The Trust further argues that the assertion that the Debtors
intend to reorganize is false since it is clear that they intend
to liquidate their assets and not continue as viable
organizations.
The Trust concludes that while substantive consolidation may
result in administrative ease it would certainly not result in
equitable treatment of the Trust's claim. Doing so would mean the
creditors of United Energy would be able to share in the assets of
Buffalo Coal, which clearly, is prejudicial to the Trust.
About Buffalo Coal
Headquartered in Oakland, Maryland, Buffalo Coal Company, Inc., is
engaged in coal mining and processing services. The company filed
for chapter 11 protection on May 5, 2006 (Bankr. N.D. W.Va. Case
No. 06-00366). David A Hoyer, Esq., at Hoyer, Hoyer & Smith,
PLLC, represents the Debtor in its restructuring efforts. Thorp
Reed and Armstrong, LLP, represents Buffalo Coal's Official
Committee of Unsecured Creditors. When the Debtor filed for
protection from its creditors, it listed total assets of
$119,323,183 and total debts of $105,887,321.
About United Energy
Headquartered in Oakland, Maryland, United Energy Coal, Inc.,
filed for chapter 11 protection on May 31, 2006 (Bankr. N.D. W.Va.
Case No. 06-00453). David A. Hoyer, Esq., at Hoyer, Hoyer &
Smith, PLLC, represents the Debtor. Court documents do not show
who United Energy's Official Committee of Unsecured Creditors
retained as counsel. When the Debtor filed for protection from
its creditors, it listed total assets of $103,575,293 and total
debts of total debts of $94,016,306.
UTGR INC: Increased Expansion Costs Cue S&P's Negative Outlook
--------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on UTGR
Inc. to negative from stable.
At the same time, Standard & Poor's affirmed its ratings on the
company, including its 'B+' issuer credit rating.
The outlook revision follows expected scope changes and
$95 million of increased costs associated with the ongoing
expansion project at Lincoln Park, a majority of which is expected
to be debt funded. While the disruption caused by the reduction
of parking spaces in the second quarter of 2006 is expected to be
temporary, cash flow for fiscal 2006 is now expected to be
slightly below our original expectation.
As a result of these factors, credit measures are likely to weaken
further than our original expectations, on top of an already
highly leveraged balance sheet for the rating. However, Standard
& Poor's continues to believe that the project will be successful,
and that credit measures will begin to improve beginning in the
latter half of 2007. If additional operating weakness occurs or
if project costs increase further beyond current expectations, a
downgrade will be considered.
In addition, more than half of Lincoln Park's employees are
covered by union contracts. Many of the company's union contracts
have come due or are expected to come due within the year, and
negotiations to extend these contracts continue.
At this time, it is expected that Lincoln Park operations will not
cease during the period of negotiation; however, if the situation
worsens, a downgrade will be considered.
VARIG S.A.: Cutting 9,500 Jobs Under Restructuring Plan
-------------------------------------------------------
VARIG, S.A., will lay off 9,500 employees and immediately rehire
1,680 pursuant to its restructuring plan, Bloomberg News relates
citing Gelson Fochesato, vice president of Brazil's Federation of
Airline workers.
To keep jobs, VARIG's unions struck a deal with the airline's new
owner, Volo do Brasil, Mr. Fochesato says.
VARIG was sold to Volo for more than $600,000,000 at an auction on
July 20, 206, averting a piecemeal liquidation of the airline's
assets.
"The idea," Mr. Fochesato told Bloomberg in an interview, "is to
immediately rehire some workers for the new company that's being
formed, and gradually rehire others as the company expands its
services over the next months."
Volo, which recently purchased VARIG's cargo unit, VARIG Logistica
S.A., is partially controlled by U.S. investment fund
MatlinPatterson Global Advisors.
About VARIG
Headquartered in Rio de Janeiro, Brazil, VARIG S.A. is Brazil's
largest air carrier and the largest air carrier in Latin America.
VARIG's principal business is the transportation of passengers and
cargo by air on domestic routes within Brazil and on international
routes between Brazil and North and South America, Europe and
Asia. VARIG carries approximately 13 million passengers annually
and employs approximately 11,456 full-time employees, of which
approximately 133 are employed in the United States.
The Company, along with two affiliates, filed for a judicial
reorganization proceeding under the New Bankruptcy and
Restructuring Law of Brazil on June 17, 2005, due to a competitive
landscape, high fuel costs, cash flow deficit, and high operating
leverage. The Debtors may be the first case under the new law,
which took effect on June 9, 2005. Similar to a chapter 11
debtor-in-possession under the U.S. Bankruptcy Code, the Debtors
remain in possession and control of their estate pending the
Judicial Reorganization. Sergio Bermudes, Esq., at Escritorio de
Advocacia Sergio Bermudes, represents the carrier in Brazil.
Each of the Debtors' Boards of Directors authorized Vicente
Cervo as foreign representative. In this capacity, Mr. Cervo
filed a Sec. 304 petition on June 17, 2005 (Bankr. S.D.N.Y. Case
Nos. 05-14400 and 05-14402). Rick B. Antonoff, Esq., at
Pillsbury Winthrop Shaw Pittman LLP represents Mr. Cervo in the
United States. As of March 31, 2005, the Debtors reported
BRL2,979,309,000 in total assets and BRL9,474,930,000 in total
debts. (VARIG Bankruptcy News, Issue No. 28; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
VARIG S.A.: Brazilian Agency Vetoes Flight Suspensions
------------------------------------------------------
VARIG, S.A., has said it will suspend all its flights except those
between Rio de Janeiro and Sao Paulo, in Brazil, until Friday,
July 28, 2006.
The reduction in flights was part of a strategy to "rapidly resume
growth and increase profitability," the Associated Press reports
citing VARIG's statement on its Web site.
On July 21, 2006, Brazil's Civil Aeronautics Agency vetoed the
flight suspensions and ordered the airline to fly all its assigned
routes, the AP reports. VARIG is assigned five national routes
and five international routes.
VARIG initially planned to operate with just 13 planes. Within
six months, the airline intended to increase the fleet to 80.
About VARIG
Headquartered in Rio de Janeiro, Brazil, VARIG S.A. is Brazil's
largest air carrier and the largest air carrier in Latin America.
VARIG's principal business is the transportation of passengers and
cargo by air on domestic routes within Brazil and on international
routes between Brazil and North and South America, Europe and
Asia. VARIG carries approximately 13 million passengers annually
and employs approximately 11,456 full-time employees, of which
approximately 133 are employed in the United States.
The Company, along with two affiliates, filed for a judicial
reorganization proceeding under the New Bankruptcy and
Restructuring Law of Brazil on June 17, 2005, due to a competitive
landscape, high fuel costs, cash flow deficit, and high operating
leverage. The Debtors may be the first case under the new law,
which took effect on June 9, 2005. Similar to a chapter 11
debtor-in-possession under the U.S. Bankruptcy Code, the Debtors
remain in possession and control of their estate pending the
Judicial Reorganization. Sergio Bermudes, Esq., at Escritorio de
Advocacia Sergio Bermudes, represents the carrier in Brazil.
Each of the Debtors' Boards of Directors authorized Vicente
Cervo as foreign representative. In this capacity, Mr. Cervo
filed a Sec. 304 petition on June 17, 2005 (Bankr. S.D.N.Y. Case
Nos. 05-14400 and 05-14402). Rick B. Antonoff, Esq., at
Pillsbury Winthrop Shaw Pittman LLP represents Mr. Cervo in the
United States. As of March 31, 2005, the Debtors reported
BRL2,979,309,000 in total assets and BRL9,474,930,000 in total
debts. (VARIG Bankruptcy News, Issue No. 28; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
VESTA INSURANCE: Unable to Pay Interests Due July 15
----------------------------------------------------
Vesta Insurance Group, Inc., disclosed in a Form 8-K filing with
the Securities and Exchange Commission that it did not pay the
interest due on July 15, 2006, relating to its 8-3/4% Senior
Debentures due 2025 and 8.525% Junior Subordinated Deferrable
Interest Debentures due 2027. The Company relates that if it is
still unable to pay the interests 30 days after the due date, that
failure to pay result in an Event of Default under the Indenture,
dated as of July 19, 1995, between Vesta and SouthTrust Bank of
Alabama, National Association, as trustee, and the Supplemental
Indenture, also dated as of July 19, 1995, relating to the 2025
Debentures and the Indenture, dated as of Jan. 31, 1997, between
Vesta and First Union National Bank of North Carolina, as trustee,
relating to the 2027 Debentures.
Court-Ordered Rehabilitation
As reported in the Troubled Company Reporter on July 6, 2006, six
insurance subsidiaries of Vesta Insurance Group, Inc., agreed
to be placed into court-ordered rehabilitation in Texas. These
subsidiaries are:
* Vesta Fire Insurance Corporation;
* Vesta Insurance Corporation;
* Shelby Insurance Company;
* Shelby Casualty Insurance Corporation;
* Texas Select Lloyds Insurance Company; and
* Select Insurance Services, Inc.
The District Court of Travis County, Texas, subsequently entered
the Agreed Order of Rehabilitation and Permanent Injunction,
appointing the Texas Commissioner of Insurance as Rehabilitator.
Cancellation of Policies
The Company reported that at the direction of the Rehabilitator,
Vesta Fire Insurance Company and Vesta Fire's Texas subsidiary
insurance companies have begun issuing notices to agents to cease
writing new and renewal insurance business, including homeowners
policies for Texas Select Lloyds customers. Absent a last minute
solution, all policies with the companies will be cancelled on
Aug. 23, 2006. The Rehabilitator has also started the process to
have Vesta Fire and its Texas subsidiary insurers, including Texas
Select, placed into liquidation.
This follows an agreed order of rehabilitation for the Texas-
domiciled companies obtained by the Texas Department of Insurance
on June 28, 2006. Texas Insurance Commissioner Mike Geeslin,
acting as Rehabilitator, immediately appointed a Special Deputy
Receiver to assume control of Vesta Fire and its Texas
subsidiaries and subsequently made a recommendation that the
companies were unable to meet their current obligations.
Prior to that determination, the Rehabilitator had been in active
negotiations with a potential buyer for certain Vesta insurers,
including Texas Select. However, the parties were unable to
complete the transaction.
In taking this action, Mr. Geeslin noted that it was in the long-
term best interests of policyholders.
"My primary goal in this action is to ensure policyholders have
insurance that is able to pay their claims should a loss occur,"
Mr. Geeslin said. "We simply could not allow policyholders and
ultimately Texas taxpayers to be at risk given the financial
condition of these companies."
Mr. Geeslin noted that concerns with Vesta Fire and its
subsidiaries extend group-wide and were not limited to Texas
Select and its underlying insurance contracts. Vesta's problems
include a series of losses from hurricanes that drove a long-term
need for additional capital. Ultimately, Vesta's capital raising
initiatives were not successful. Similar to the Texas actions,
regulators in Hawaii have taken control of another Vesta
subsidiary, Hawaiian Insurance & Guaranty Co. Ltd., and Florida
regulators have taken control of another affiliate, Florida Select
Insurance Company.
Until earlier this year, Texas Select Lloyds was the only Vesta
insurer domiciled in Texas. In May, four other Vesta insurers re-
domesticated to Texas, including Vesta Fire. Vesta Fire is the
parent company of the other Vesta insurers and served as a
financial backstop for the subsidiary insurers, including Texas
Select. These actions were coordinated by the Texas Department of
Insurance in order to consolidate regulatory authority.
Affected policyholders should contact their insurance agents as
soon as possible to begin securing new insurance coverage. TDI is
also assisting Texas policyholders to obtain new insurance
immediately. Policyholders located in other states may request
similar assistance from their respective states' insurance
departments. Consumer Assistance specialists may be reached at the
Texas Department's toll-free number at 1-800-252-3439.
Additional information can be obtained at TDI's websites at:
http://www.tdi.state.tx.us/and http://www.helpinsure.com/
About Vesta Insurance
Headquartered in Birmingham, Alabama, Vesta Insurance Group, Inc.
(Other OTC: VTAI.PK) -- http://www.vesta.com/-- is a holding
company for a group of insurance companies that primarily offer
property insurance in targeted states.
At Sept. 30, 2004, Vesta Insurance Group, Inc.'s balance sheet
showed a $40,928,000 stockholders' deficit compared to a
$100,035,000 positive equity at Dec. 31, 2003.
* * *
As reported in the Troubled Company Reporter on July 12, 2006,
A.M. Best Co. has revised the financial strength rating to E
(Under Regulatory Supervision) from C++ (Marginal) and the issuer
credit ratings to "d" from "b" for the property/casualty
affiliates of Vesta Insurance Group (Vesta). Concurrently, A.M.
Best has revised the ICR to "d" from "cc" for Vesta's parent,
Vesta Insurance Group, Inc. [Other OTC: VTAI.PK]. Additionally,
A.M. Best has revised the senior debt ratings to "d" from "cc" for
Vesta's $100 million 8.75% senior unsecured debentures, due 2025
and to "d" from "c" for Vesta Capital Trust I's $100 million
8.525% deferrable capital securities, due 2027. All companies are
located in Birmingham, Alabama.
The rating revisions pertain to these property/casualty affiliates
of the Vesta Insurance Group: Vesta Fire Insurance Corporation;
Florida Select Insurance Company; The Hawaiian Insurance &
Guaranty Company, Limited; Shelby Casualty Insurance Company; The
Shelby Insurance Company; Texas Select Lloyds Insurance Company;
and Vesta Insurance Corporation.
As reported in the Troubled Company Reporter on July 7, 2006,
Moody's Investors Service lowered the senior debt rating of Vesta
Insurance Group to C from B3 and the trust preferred rating of
Vesta Capital Trust I to C from Caa2. This rating action follows
the company's announcement on July 3, 2006, that six of its
insurance subsidiaries had been placed into court-ordered
rehabilitation in Texas and that the company's two other insurance
subsidiaries have consented to entry of similar orders in other
regulatory jurisdictions.
VESTA INSURANCE: Bondholders File Involuntary Chapter 7 Petition
----------------------------------------------------------------
Vesta Insurance Group, Inc., disclosed in a filing with the
Securities and Exchange Commission that an involuntary Chapter 7
petition was filed against the Company on July 18, 2006, in the
U.S. Bankruptcy Court for the Northern District of Alabama.
Court documents show that three bondholders with a total claim of
$12.25 million filed the petition.
As reported in the Troubled Company Reporter on Jul 6, 2006, six
insurance subsidiaries of the Company, agreed to be placed into
court-ordered rehabilitation in Texas. These subsidiaries are:
* Vesta Fire Insurance Corporation;
* Vesta Insurance Corporation;
* Shelby Insurance Company;
* Shelby Casualty Insurance Corporation;
* Texas Select Lloyds Insurance Company; and
* Select Insurance Services, Inc.
The District Court of Travis County, Texas, subsequently entered
the Agreed Order of Rehabilitation and Permanent Injunction,
appointing the Texas Commissioner of Insurance as Rehabilitator.
About Vesta Insurance
Headquartered in Birmingham, Alabama, Vesta Insurance Group, Inc.
(Other OTC: VTAI.PK) -- http://www.vesta.com/-- is a holding
company for a group of insurance companies that primarily offer
property insurance in targeted states.
At Sept. 30, 2004, Vesta Insurance Group, Inc.'s balance sheet
showed a $40,928,000 stockholders' deficit compared to a
$100,035,000 positive equity at Dec. 31, 2003.
* * *
As reported in the Troubled Company Reporter on July 12, 2006,
A.M. Best Co. has revised the financial strength rating to E
(Under Regulatory Supervision) from C++ (Marginal) and the issuer
credit ratings to "d" from "b" for the property/casualty
affiliates of Vesta Insurance Group (Vesta). Concurrently, A.M.
Best has revised the ICR to "d" from "cc" for Vesta's parent,
Vesta Insurance Group, Inc. [Other OTC: VTAI.PK]. Additionally,
A.M. Best has revised the senior debt ratings to "d" from "cc" for
Vesta's $100 million 8.75% senior unsecured debentures, due 2025
and to "d" from "c" for Vesta Capital Trust I's $100 million
8.525% deferrable capital securities, due 2027. All companies are
located in Birmingham, Alabama.
The rating revisions pertain to these property/casualty affiliates
of the Vesta Insurance Group: Vesta Fire Insurance Corporation;
Florida Select Insurance Company; The Hawaiian Insurance &
Guaranty Company, Limited; Shelby Casualty Insurance Company; The
Shelby Insurance Company; Texas Select Lloyds Insurance Company;
and Vesta Insurance Corporation.
As reported in the Troubled Company Reporter on July 7, 2006,
Moody's Investors Service lowered the senior debt rating of Vesta
Insurance Group to C from B3 and the trust preferred rating of
Vesta Capital Trust I to C from Caa2. This rating action follows
the company's announcement on July 3, 2006 that six of its
insurance subsidiaries had been placed into court-ordered
rehabilitation in Texas and that the company's two other insurance
subsidiaries have consented to entry of similar orders in other
regulatory jurisdictions.
VESTA INSURANCE: Involuntary Chapter 7 Case Summary
---------------------------------------------------
Alleged Debtor: Vesta Insurance Group, Inc.
3760 River Run Drive
Birmingham, Alabama 35243
Involuntary Petition Date: July 18, 2005
Case Number: 06-02517
Chapter: 7
Court: Northern District of Alabama (Birmingham)
Judge: Thomas B. Bennett
Petitioners' Counsel: R. Scott Williams, Esq.
Haskell Slaughter Young & Rediker, LLC
1400 Park Place Tower
2001 Park Place North
Birmingham, Alabama 35203
Tel: (205) 251-1000
Fax: (205) 324-1133
Petitioners Nature of Claim Claim Amount
----------- --------------- ------------
Wyatt R. Haskell Bond Indebtedness $7,000,000
2001 Park Place North
Suite 1400
Birmingham, AL 35203
Luther S. Pate, IV Bond Indebtedness $1,250,000
P.O. Box 468
Northport, AL 35476
Costa Brave Partnership Bond Indebtedness $4,000,000
c/o Seth Hamot
Roark Reardon Hamot
420 Boylston Street
Boston, MA 02116
VJCS ACQUISITION: S&P Junks Rating on $55 Million Senior Debts
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' corporate
credit rating to VJCS Acquisition Inc. The rating outlook is
stable.
At the same time, ratings were assigned to the company's $190
million senior secured financing, consisting of a $30 million
revolving credit facility maturing in 2012 and a $160 million term
loan B maturing in 2013. The facilities were rated 'B' (at the
same level as the corporate credit rating) with a recovery rating
of '2', indicating the expectation for substantial (80%-100%)
recovery of principal in the event of a payment default.
In addition, a 'CCC+' rating was assigned to the company's $55
million senior subordinated mezzanine debt offering due in 2013.
The debt issuances were used to help fund the acquisition of Vi-
Jon Laboratories Inc. and Cumberland Swan Holdings Inc. by
Berkshire Partners. The newly created entity is VJCS Acquisition
Inc., a leading private-label personal care manufacturer.
"The corporate credit rating on VJCS Acquisition Inc. reflects the
company's participation in the highly competitive personal care
segment of the consumer products industry, high debt leverage,
customer concentration, and the risks of integrating a large
acquisition," said Standard & Poor's credit analyst Patrick
Jeffrey.
"These risks are mitigated somewhat by the company's leading
position as a private-label manufacturer and its established
relationships with key retailers."
WCI COMMUNITIES: Moody's Reviews Ratings and May Downgrade
----------------------------------------------------------
Moody's Investors Service placed the ratings of WCI Communities,
Inc. under review for possible downgrade, including its corporate
family rating of Ba2 and the Ba3 rating on its four issues of
senior subordinated notes. The review was prompted in large part
by the company's response to the very challenging sales
environment that it is currently experiencing in Florida,
especially in its tower division.
The current sales environment is characterized by increased use of
sales incentives, higher cancellation rates, greatly reduced
traffic, and a large increase in the supply of competing units for
sale. In response, the company has curtailed new land purchases,
reduced its spending on land development, delayed the release of a
number of tower units, and taken other steps to cut costs,
conserve cash, and generate free cash flow. It is the use of this
free cash flow that presents the problem.
Rather than delevering, WCI is using a significant amount of the
free cash flow to repurchase shares. Three million shares have
been repurchased thus far this fiscal year, with authorization of
up to an additional two million shares still remaining and likely
to be fulfilled, resulting in a cash outlay and reduction in
common equity of about $100 million and adding approximately four
percentage points to debt leverage.
Moody's review will focus on the company's financial flexibility
in light of its revised performance expectations; how the current
sales environment, which Moody's believes will persist into 2007,
will impact WCI's operating performance and liquidity going
forward; and whether current and anticipated debt protection
measures are appropriate for the existing ratings level. If the
review should result in a one-notch reduction in the Ba2 corporate
family rating, the ratings on the existing senior subordinated
note issues will likely be reduced by two notches.
Headquartered in Bonita Springs, Florida, WCI Communities, Inc. is
a fully integrated homebuilding and real estate services company
with 58 years of experience in the design, construction, and
operation of leisure-oriented, amenity-rich master planned
communities targeting affluent homebuyers. Revenues and earnings
for 2005 were $2.6 billion and $186 million, respectively.
WERNER LADDER: Committee Wants Greenberg Traurig as Co-Counsel
--------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in the
chapter 11 cases of Werner Holding Co. (DE), Inc., aka Werner
Ladder Company, and its debtor-affiliates asks permission from the
U.S. Bankruptcy Court for the District of Delaware to retain
Greenberg Traurig, LLP as its co-counsel, effective as of June 28,
2006.
The Creditors Committee selected Greenberg Traurig because it has
the resources and experience necessary to the represent the
Committee. The firm has substantial experience in representing
creditors committees and is familiar with complex reorganization
cases.
Greenberg Traurig will coordinate any services performed with
Winston & Strawn LLP, the Committee's proposed lead counsel, to
minimize duplication of duties and responsibilities.
Greenberg Traurig will:
(1) consult with the Debtors' professionals or representatives
concerning the administration of their Chapter 11 cases;
(2) prepare and review, on the Committee's behalf, all
pleadings, motions and correspondence and appear and be
involved in proceedings before the Court;
(3) provide legal counsel to the Committee in its investigation
of the acts, conduct, assets, liabilities and financial
condition of the Debtors, the operation of their businesses
and any other relevant matters in their Chapter 11 cases;
(4) analyze the Debtors' proposed use of cash collateral and
debtor-in-possession financing;
(5) advise the Committee with respect to its rights, duties and
powers in the Debtors' Chapter 11 cases;
(6) assist the Committee in analyzing the claims of the
Debtors' creditors and in negotiations with the creditors;
(7) assist the Committee in its analysis and negotiations with
the Debtors or any third party concerning matters related
to the terms of an asset sale, plan of reorganization or
other conclusion of the case;
(8) assist and advise the Committee in communicating with the
general creditor body regarding significant matters in the
Debtors' Chapter 11 cases and in determining a course of
action that best serves the interests of the unsecured
creditors; and
(9) perform all other legal services to the Committee that are
required in the Debtors' chapter 11 cases.
The firm's principal attorneys and paralegals proposed to
represent the Committee are:
Professional Hourly Rate
----------- -----------
Monica L. Loftin $470
Diane E. Vuocolo $390
Dennis Meloro $300
Elizabeth Thomas $170
Other professionals of Greenberg Traurig who will provide
services to the Committee will be paid at these hourly rates:
Designation Hourly Rate
----------- -----------
Shareholders $235 - $750
Associates $130 - $480
Legal Assistants $65 - $230
Paralegals $65 - $230
Greenberg Traurig will also seek reimbursement of actual,
necessary expenses and other charges incurred in connection with
the Committee's representation.
Diane E. Vuocolo, Esq., a shareholder of Greenberg Traurig,
assures the Court that the firm is a disinterested person as that
term is defined Section 101(14) of the Bankruptcy Code, and that
the firm represents no interest adverse to the Debtors and their
estates.
About Werner Ladder
Headquartered in Greenville, Pennsylvania, Werner Co. --
http://www.wernerladder.com/-- manufactures and distributes
ladders, climbing equipment and ladder accessories. The company
and three of its affiliates filed for chapter 11 protection on
June 12, 2006 (Bankr. D. Del. Case No. 06-10578). Kara Hammond
Coyle, Esq., Matthew Barry Lunn, Esq., and Robert S. Brady, Esq.,
Young, Conaway, Stargatt & Taylor, LLP, serves as the Debtors'
counsel. The firm of Willkie Farr & Gallagher LLP represents the
Debtors as its co-counsel. The Debtors have retained Rothschild
Inc. as their financial advisor and investment banker. At March
31, 2006, the Debtors reported total assets of $201,042,000 and
total debts of $473,447,000. (Werner Ladder Bankruptcy News,
Issue No. 5; Bankruptcy Creditors' Service, Inc., 215/945-7000)
WERNER LADDER: Wants To Honor Incentive-Based Bonus Plans
---------------------------------------------------------
Werner Holding Co. (DE), Inc., aka Werner Ladder Company, and its
debtor-affiliates, ask the U.S. Bankruptcy Court for the District
of Delaware to approve the Bonus Plans and authorize them to fund
the Bonus Plans.
The Debtors pay their employees in part through the use of
incentive-based bonus programs. The bonus programs have been part
of the Debtors' compensation strategy to identify and implement a
number of business objectives through incentive-based
compensation.
During 2005, it became clear to senior management and the Board
of Directors that in order to properly align the interests of
employees and shareholders, management needed to implement a
bonus plan that was based on employees reaching identifiable
goals with a deferred payment schedule to properly motivate
employees to perform effectively and remain with the Debtors
during their operational restructuring, relates Robert S. Brady,
Esq., at Young, Conaway, Stargatt & Taylor, LLP in Wilmington,
Delaware.
BOB Plan
In January 2006, the Debtors crafted a business optimization
bonus plan to motivate key employees who have the ability to
directly impact key optimization incentives. The BOB Plan
provides for bonus payments to be paid to eligible employees who
meet certain performance objectives. Each employee participating
in the BOB Plan is eligible to receive a bonus payment, which can
range from 10% to 75% of an employee's annual salary.
To be eligible for a BOB payment, an employee must be recommended
by the president or chief executive officer, have articulated
individual performance objectives that must be approved by his or
her supervisor, meet his or her individual performance goals and
the Debtors must meet certain organizational performance goals.
The BOB payments are payable in four equal installments, with
the first installment paid on March 31, 2006. The remaining
three installments will be paid on July 31, 2006, November 30,
2006, and March 31, 2007. About 116 employees are eligible to
participate in the BOB Plan, which has a $4,000,000 total cost
and each eligible employee to be paid an average of $35,000,
Mr. Brady relates.
Chicago Transition Bonus Plan
In January 2006, the Debtors also adopted a Chicago transition
plan to motivate key employees who can help transition operations
from the transfer of the manufacturing operations in the facility
in Chicago, Illinois to the new facility in Juarez, Mexico.
The Chicago Plan provides payments for employees who are crucial
to the Chicago transition process. The Chicago Plan bonuses
range from 8% to 100% of an employee's annual salary.
To be eligible for a Chicago bonus payment, an employee must:
-- be recommended by the Chicago general manager and the
president or chief executive officer;
-- play a key role in the Chicago transition; and
-- meet individual performance targets set by the Chicago
general manager.
The Chicago bonuses are payable in one lump sum within 15 days of
the employee meeting his or her performance objectives. About 81
employees are eligible to participate in the Chicago Plan, which
has a $2,600,000 estimated total cost and with each eligible
employee to be paid an average of $32,000, Mr. Brady relates.
When reduced by the aggregate amount of severance that would be
payable to employees upon completion of the Chicago Transition
Plan, the total cost of the Chicago Bonuses is approximately
$1,150,000.
Debtors to Keep Bonus Plans
The Debtors tell the Court that their employees are critical to
their business operations and their restructuring efforts.
Concerns over a sudden loss of income might prompt employees to
look elsewhere for employment. Replacing employees would be
extremely difficult for the Debtors and would place enormous
burdens on the remaining employees.
Additionally, many employees, according to Mr. Brady, will play a
critical role in the Chicago transition by providing needed
support and training their replacements for the transfer of the
Debtors' operations to the Juarez facility, which is critical to
their restructuring efforts.
Accordingly, the Debtors believe that continuation of the Bonus
Plans is imperative to boost employee morale, encourage
productivity and motivate the employees to remain in their jobs
during the critical period of the Debtors' restructuring efforts.
About Werner Ladder
Headquartered in Greenville, Pennsylvania, Werner Co. --
http://www.wernerladder.com/-- manufactures and distributes
ladders, climbing equipment and ladder accessories. The company
and three of its affiliates filed for chapter 11 protection on
June 12, 2006 (Bankr. D. Del. Case No. 06-10578). Kara Hammond
Coyle, Esq., Matthew Barry Lunn, Esq., and Robert S. Brady, Esq.,
Young, Conaway, Stargatt & Taylor, LLP, serves as the Debtors'
counsel. The firm of Willkie Farr & Gallagher LLP represents the
Debtors as its co-counsel. The Debtors have retained Rothschild
Inc. as their financial advisor and investment banker. At March
31, 2006, the Debtors reported total assets of $201,042,000 and
total debts of $473,447,000. (Werner Ladder Bankruptcy News,
Issue No. 5; Bankruptcy Creditors' Service, Inc., 215/945-7000)
WINDOW ROCK: Wants to Borrow $1M from Prestige to Fund Inventory
----------------------------------------------------------------
Window Rock Enterprises Inc. asks the U.S. Bankruptcy Court for
the Northern District of California for permission to borrow
around $1 million from Prestige Capital Corporation under debtor-
in-financing agreement.
Robert E. Opera, Esq., at Winthrop Couchot, P.C., tells the Court
that the Debtor currently has not financing arrangement in place.
Without access to financing, the Debtor will not have cash
sufficient to purchase the inventory that it needs to ship product
to fulfill timely its retail customers' purchase orders generated
from the Debtor's most recent trade show, for retailer rollout in
about late August 2006. The Debtor will need to purchase around
$1 million in inventory to meet its delivery obligations for those
purchase orders. The suppliers with which the Debtor contracts to
purchase those inventory have declined to provide the Debtor trade
credit.
The Debtor currently does not have cash sufficient to purchase the
inventory because of a combination of these factors:
(a) the Debtor's agreement with the Official Committee of
Unsecured Creditors and with the Federal Trade Commission
to segregate the Debtor's cash in an amount around
$9 million so that these funds are available for use to
finance the Debtor's chapter 11 plan;
(b) delay by the Debtor's customers in paying obligations
currently owed to the Debtor, totaling around $2.3 million;
(c) the Debtor's need to pay, on a monthly basis, the
substantial amount of administrative fees of professionals
in the its bankruptcy case;
(d) the accelerated payment terms required by the Debtor's
vendors in light of the Debtor's bankruptcy.
The proposed financing will enable the Debtor to generate around
$4 million in sales, with substantial profits, net of anticipated
financing costs, Mr. Opera contends.
The Debtor proposes to grant Prestige a security interest
encumbering the Debtor's accounts receivable, inventory and other
assets to secure the Debtor's repayment of its obligations to
Prestige. The Debtor will incur these fees in connection with the
sale of its receivables to Prestige under their agreement:
Discount Fee No. of Days to Collect
------------ ----------------------
2% < 15 days
3% 16 to 30 days
4% 31 to 45 days
5% 46 to 60 days
6% 61 to 75 days
1% for each 15 days thereafter
Headquartered in Brea, California, Window Rock Enterprises Inc.
-- http://windowrock.net/-- manufactures and sells all-natural
dietary and nutritional supplements. The Debtor is also producing
its own TV, radio and print advertising campaigns for nutritional
and dietary supplements and has distribution in over 40,000 Food
Drug Mass Clubs as well as Health and Fitness Channels. The
Company filed for chapter 11 protection on Nov. 23, 2005 (Bankr.
C.D. Calif. Case No. 05-50048). Robert E. Opera, Esq., Winthrop
Couchot, PC represents the Debtor in its restructuring efforts.
The Official Committee of Unsecured Creditors selected Peiztman,
Weg & Kempinsky, LLP, as its counsel. When the Debtor filed for
protection from its creditors, it listed estimated assets of
$10 million to $50 million and estimated debts of more than
$100 million.
WINFIELD CAPITAL: Written Claims Must be Filed by August 21
-----------------------------------------------------------
The U.S. District Court for the Southern District of New York set
Aug. 21, 2006, as the deadline for entities who want to assert a
claim against Winfield Capital Corp. to file a written claim to
Winfield's receiver:
U.S. Small Business Administration
Receiver for Winfield Capital Corp.
Edward G. Broenniman, Managing Director
The Piedmont Group, LLC, Principal Agent
666 11th Street, N.W., Suite 200
Washington D.C. 20001-4542
(202) 272-3617
Claims must be received by 5:00p.m. of Aug. 21, and must state:
(a) the full name, address and telephone number of the
claimant;
(b) the amount of the claim;
(c) the specific grounds for each claim; and
(d) the date on which the obligation was allegedly incurred by
Winfield or the Receiver.
Supporting documents must be attached. Failure to provide any of
the specified information or late filing will result in the
creditor being forever barred to make a claim against Winfield
Winfield Capital Corporation is a small business investment
company licensed by the U.S. Small Business Administration. The
Company is also a non-diversified, closed-end investment company
that is a business development company under the Investment
Company Act of 1940. The Company has been in receivership since
Oct. 14, 2005, under Case No. 1:05-cv-08395-AKH, U.S. v. Winfield
Capital Corp.
WOMEN FIRST: Trust Wins Disputed $656,184 McKesson Escrow Fund
--------------------------------------------------------------
The Honorable Mary F. Walrath of the U.S. Bankruptcy Court denied
the request of McKesson Corporation, a customer of Women First
Healthcare, Inc., to compel payment of $656,184 escrowed in
connection with the sale of the Debtor's Vaniqa assets to
SkinMedica, Inc.
Finding that McKesson owed $656,184 prepetition to Women First for
unpaid Vaniqa products, Judge Walrath said Women First can setoff
its claims against McKesson and the estate is entitled to the
escrowed funds.
Women First filed for chapter 11 protection on April 29, 2004.
Women First filed a motion to sell its Vaniqa assets and
SkinMedica was the successful purchaser in an auction process.
The Court approved the $38.85 million sale transaction on June 25,
2004.
Under the Asset Purchase Agreement, SkinMedica agreed to assume
and deduct from the purchase price the dollar amount of any
obligation of Women First to wholesalers and chain warehouses for
Vaniqa product returned on or before June 25, 2004.
A dispute arose as to the amount due to McKesson for product
returns. As a result, SkinMedica paid McKesson the undisputed
amount of approximately $3.45 million and placed in escrow the
disputed amount of $656,184.
McKesson filed its motion to compel payment of the disputed
amount. Women First objected and the WFHC Liquidating Trust
(created under the Debtor's confirmed Liquidating Plan) also
opposed McKesson's motion.
The Trust asserted that McKesson is not entitled to any further
payments under the APA because the estate has a claim against
McKesson for unpaid product shipped to it, which must be set off
against any claim that McKesson has against the estate for
returned product. Specifically, the Trust asserted that McKesson
owed the estate $656,184 for Vaniqa product shipped by the Debtor
to McKesson in March and April 2004 which remained unpaid.
McKesson argued that setoff is not available because its right to
payment under the APA is a postpetition obligation and its
obligation to Women First is prepetition.
Judge Walrath said that unlike a setoff by creditor, which
requires existence of mutual debts both of which arose
prepetition, the Debtor may setoff its prepetition claims against
its postpetition obligations under Sections 553 and 558 of the
Bankruptcy Code.
In a decision published at 2006 WL 1867901, Judge Walrath held
that:
(1) Women First's right to set off its claims against
McKesson for shipments of products for which the Debtor
had not been paid against its own obligation to McKesson
in connection with product returns was governed, not by
provision of the Bankruptcy Code purporting to preserve
creditors' nonbankruptcy setoff rights, but by separate
provision;
(2) SkinMedica's assumption of Women First's obligation to
McKesson in connection with product returns did not affect
mutuality that existed between parties, for purpose of
deciding whether Women First could set off its claims
against McKesson; and
(3) SkinMedica's assumption of Women First's obligation to
McKesson in connection with product returns, while
occurring postpetition, did not affect prepetition nature
of Women First's own obligation to McKesson for these
returns.
Headquartered in San Diego, California, Women First HealthCare,
Inc. -- http://www.womenfirst.com/-- was a specialty
pharmaceutical company dedicated to improve the health and
well-being of midlife women. The Company filed for chapter 11
protection on April 29, 2004 (Bankr. Del. Case No. 04-11278).
Robert A. Klyman, Esq., at Latham & Watkins LLP, and Michael R.
Nestor, Esq., and Sean Matthew Beach, Esq., at Young Conaway
Stargatt & Taylor, LLP, represented the Debtor. Kirt F. Gwynne,
Esq., at Reed Smith LLP, represented the Official Committee of
Unsecured Creditors. When the Company filed for protection from
its creditors, it listed $49,089,000 in total assets and
$73,590,000 in total debts. The Court confirmed the Debtor's
Liquidating Plan on Dec. 28, 2004. Stephen W. Spence is the
Liquidating Trustee appointed pursuant to the confirmed Plan.
Mark Eckard, Esq., at Reed Smith LLP and Stephen W. Spence, Esq.,
at Phillips, Goldman & Spence, P.A., represents the Liquidating
Trustee.
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
July 26-29, 2006
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Workshop
The Ritz Carlton Amelia Island, Amelia Island, Florida
Contact: 1-703-739-0800; http://www.abiworld.org/
July 27, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Should legislative protection or indemnities
be provided to Chief Restructuring Officers
to encourage turnarounds?
Bondi Room, Sydney, NSW
Contact: http://www.turnaround.org/
July 31, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Annual Golf & Tennis Outing
Raritan Valley Country Club, Bridgewater, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
July 31, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Summer Social BBQ
Colonial Springs Country Club, Long Island, New York
Contact: 631-251-6296 or http://www.turnaround.org/
August 3, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Commercial Lenders Breakfast
Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
August 3-5, 2006
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Workshop
Hyatt Regency Chesapeake Bay, Cambridge, Maryland
Contact: 1-703-739-0800; http://www.abiworld.org/
August 3, 2006
BEARD AUDIO CONFERENCES
Homestead Exemptions under BAPCPA
Audio Conference
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
August 9, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Professional Development Meeting
Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
August 15, 2006
TURNAROUND MANAGEMENT ASSOCIATION
DIP Panel Discussion
Kansas City, Missouri
Contact: http://www.turnaround.org/
August 16, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Family Night Baseball with the NJ Jackals
(Yogi Berra Autograph Night)
Jackals Stadium, Montclair, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
August 25, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Annual Fishing Trip
Point Pleasant, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
August 29, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
Citrus Club, Orlando, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
September 6, 2006
TURNAROUND MANAGEMENT ASSOCIATION
4th Annual Alberta Golf Tournament
Kananaskis Country Golf Course, Kananaskis, Alberta
Contact: 403-294-4954 or http://www.turnaround.org/
September 7, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Business Mixer
TBA, Seattle, Washington
Contact: 503-223-6222 or http://www.turnaround.org/
September 7-8, 2006
EUROMONEY
Leveraged Finance
Hotel Rey Juan Carlos I, Barcelona, Spain
Contact: http://www.euromoneyplc.com/
September 7-8, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Saratoga Regional Conference
Gideon Putnam Hotel, Saratoga Springs, New York
Contact: http://www.turnaround.org/
September 7-9, 2006
AMERICAN BANKRUPTCY INSTITUTE
Southwest Bankruptcy Conference
Wynn Las Vegas, Las Vegas, Nevada
Contact: 1-703-739-0800; http://www.abiworld.org/
September 8-9, 2006
AMERICAN BANKRUPTCY INSTITUTE
International Insolvency Symposium
London, England
Contact: http://www.turnaround.org/
September 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Meeting
Marriott Tyson's Corner, Vienna, Virginia
Contact: 703-912-3309 or http://www.turnaround.org/
September 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Breakfast
TBA, Secaucus, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
September 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
LI Turnaround Formal Event
Long Island, New York
Contact: http://www.turnaround.org/
September 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Function
Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
September 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Formal Event - Major Speaker to be Announced
Long Island, New York
Contact: 631-251-6296 or http://www.turnaround.org/
September 13-15, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Texas Regional Conference
Hyatt Regency Resort & Spa
Lost Pines, TX
Contact: 870-760-7116 or http://www.turnaround.org/
September 14, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Kick-Off Reception
Westin Buckhead, Atlanta, GA
Contact: 678-795-8103 or http://www.turnaround.org/
September 15, 2006
TURNAROUND MANAGEMENT ASSOCIATION
BOK Review - Management
Gardner Carton & Douglas, Chicago, IL
Contact: 815-469-2935 or http://www.turnaround.org/
September 17-24, 2006
NATIONAL ASSOCIATION OF BANKRUPTCY TRUSTEES
Optional Alaska Cruise
Seattle, Washington
Contact: 800-929-3598 or http://www.nabt.com/
September 19-20, 2006
STRATEGIC RESEARCH INSTITUTE
2nd Annual Euro Distressed Debt Summit
Le Meridien Parkhotel, Frankfurt, Germany
Contact: http://www.srinstitute.com/
September 20, 2006
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
Bankers Club, Miami, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
September 21, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Restructuring Workshop With US
Bankruptcy Judges Hale, Nelms and Lynn
Belo Mansion - The Pavilion, Dallas, TX
Contact: http://www.turnaround.org/
September 24, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Restructuring the Troubled High Tech Company
Arizona
Contact: http://www.turnaround.org/
September 26, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
Centre Club, Tampa, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
September 27, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Joint Education Program with NYIC Joint Reception
CFA/RMA/IWIRC
Woodbridge Hilton, Iselin, NJ
Contact: http://www.turnaround.org/
September 27, 2006
TURNAROUND MANAGEMENT ASSOCIATION
7th Annual Cross Border Business Restructuring and
Turnaround Conference
Banff, Alberta
Contact: http://www.turnaround.org/
October 5, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Commercial Lenders Breakfast
Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
October 10, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Meeting
Center Club, Baltimore, Maryland
Contact: 703-912-3309 or http://www.turnaround.org/
October 11, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Professional Development Meeting
Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
October 11-14, 2006
TURNAROUND MANAGEMENT ASSOCIATION
2006 Annual Conference
Milleridge Cottage, Long Island, New York
Contact: 312-578-6900; http://www.turnaround.org/
October 12, 2006
TURNAROUND MANAGEMENT ASSOCIATION
UTS Fundamentals of Turnaround Management
Mecure Hotel - Haymarket, Sydney, Australia
Contact: http://www.turnaround.org/
October 17, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Updates on the New Bankruptcy Law
Kansas City, Missouri
Contact: http://www.turnaround.org/
October 19, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Billards Networking Night - Young Professionals
TBA, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
October 26, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Hedge Funds - Expanded Financing Opportunities in Business
Turnarounds
Arizona
Contact: http://www.turnaround.org/
October 26, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Speaker Series #3
TBA, Calgary, Alberta
Contact: 403-294-4954 or http://www.turnaround.org/
October 26, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Speaker Series #3
TBA, Calgary, Alberta
Contact: 403-294-4954 or http://www.turnaround.org/
October 27, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast with Coach Dan Reeves
Westin Buckhead, Atlanta, GA
Contact: 678-795-8103 or http://www.turnaround.org/
October 28, 2006
TURNAROUND MANAGEMENT ASSOCIATION
BK/TMA Golf Tournament
Orange Tree Golf Resort, AZ
Contact: 623-581-3597 or http://www.turnaround.org/
October 30-31, 2006
Distressed Debt Summit: Preparing for the Next Default Cycle
Financial Research Associates LLC
Helmsley Hotel, New York, NY
Contact: http://www.frallc.com/
October 31, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
Citrus Club, Orlando, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
October 31 - November 1, 2006
INTERNATIONAL WOMEN'S INSOLVENCY & RESTRUCTURING CONFEDERATION
IWIRC Annual Conference
San Francisco, California
Contact: http://www.iwirc.com/
November 1, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Halloween Isn't Over! - Ghosts of turnarounds past who
remind you about what you should have done differently
Portland, Oregon
Contact: http://www.turnaround.org/
November 1-4, 2006
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
San Francisco, California
Contact: http://www.ncbj.org/
November 2-3, 2006
BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES
Third Annual Conference on Physician Agreements & Ventures
Successful Strategies for Medical Transactions and
Investments
The Millennium Knickerbocker Hotel - Chicago
Contact: 903-595-3800; 1-800-726-2524;
http://www.renaissanceamerican.com/
November 7, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Breakfast
Marriott, Bridgewater, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
November 8, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Meeting
Marriott Tyson's Corner, Vienna, Virginia
Contact: 703-912-3309 or http://www.turnaround.org/
November 8, 2006
TURNAROUND MANAGEMENT ASSOCIATION
TMA Australia National Conference
Sydney, Australia
Contact: http://www.turnaround.org/
November 14, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon Program
St. Louis, Missouri
Contact: 815-469-2935 or http://www.turnaround.org/
November 15, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Joint Reception with NYIC/NYTMA
TBA, New York
Contact: 908-575-7333 or http://www.turnaround.org/
November 15, 2006
LI TMA Formal Event
TMA Australia National Conference
Long Island, New York
Contact: http://www.turnaround.org/
November 15, 2006
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
Citrus Club, Orlando, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
November 16, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Bankruptcy Judges Panel
Duquesne Club, Pittsburgh, Pennsylvania
Contact: http://www.turnaround.org/
November 16, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Dinner Program
TBA, Seattle, Washington
Contact: 503-223-6222 or http://www.turnaround.org/
November 23, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Martini Party
Vancouver, British Columbia
Contact: 403-294-4954 or http://www.turnaround.org/
November 27-28, 2006
BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES
Thirteenth Annual Conference on Distressed Investing
Maximizing Profits in the Distressed Debt Market
The Essex House Hotel - New York
Contact: 903-595-3800; 1-800-726-2524;
http://www.renaissanceamerican.com/
November 28, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
Centre Club, Tampa, FL
Contact: 561-882-1331 or http://www.turnaround.org/
November 29, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Special Program
TBA, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
November 29, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Turnaround Industry Trends
Jasna Polana, Princeton, NJ
Contact: http://www.turnaround.org/
November 30-December 2, 2006
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Hyatt Regency at Gainey Ranch, Scottsdale, Arizona
Contact: 1-703-739-0800; http://www.abiworld.org/
December 6, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Holiday Dinner
Portland, Oregon
Contact: 503-223-6222 or http://www.turnaround.org/
December 7, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Breakfast
The Newark Club, Newark, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
December 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
LI TMA Holiday Party
TBA, Long Island, New York
Contact: 631-251-6296 or http://www.turnaround.org/
December 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Christmas Function
GE Commercial Finance, Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
December 20, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Holiday Extravaganza - TMA, AVF & CFA
Georgia Aquarium, Atlanta, GA
Contact: 678-795-8103 or http://www.turnaround.org/
January 12, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Annual Lender's Panel Breakfast
Westin Buckhead, Atlanta, GA
Contact: http://www.turnaround.org/
February 8-11, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Certified Turnaround Professional (CTP) Training
NY/NJ
Contact: http://www.turnaround.org/
February 2007
AMERICAN BANKRUPTCY INSTITUTE
International Insolvency Symposium
San Juan, Puerto Rico
Contact: 1-703-739-0800; http://www.abiworld.org/
March 15, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Martini Madness Cocktail Reception with Geraldine Ferraro
Westin Buckhead, Atlanta, GA
Contact: 678-795-8103 or http://www.turnaround.org/
March 15-18, 2007
NATIONAL ASSOCIATION OF BANKRUTPCY TRUSTEES
NABT Spring Seminar
Ritz-Carlton Buckhead, Atlanta, GA
Contact: http://www.NABT.com/
March 27-31, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Spring Conference
Four Seasons Las Colinas, Dallas, Texas
Contact: http://www.turnaround.org/
March 29-31, 2007
ALI-ABA
Chapter 11 Business Reorganizations
Scottsdale, Arizona
Contact: 1-800-CLE-NEWS; http://www.ali-aba.org/
April 11-15, 2007
AMERICAN BANKRUPTCY INSTITUTE
ABI Annual Spring Meeting
J.W. Marriott, Washington, DC
Contact: 1-703-739-0800; http://www.abiworld.org/
April 20, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast meeting with Chapter President, Bruce Sim
Westin Buckhead, Atlanta, GA
Contact: 678-795-8103 or http://www.turnaround.org/
June 6-9, 2007
ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
23rd Annual Bankruptcy & Restructuring Conference
Westin River North, Chicago, Illinois
Contact: http://www.airacira.org/
June 14-17, 2007
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort, Traverse City, Michigan
Contact: 1-703-739-0800; http://www.abiworld.org/
July 12-15, 2007
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Marriott, Newport, RI
Contact: 1-703-739-0800; http://www.abiworld.org/
October 10-13, 2007
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Orlando, Florida
Contact: http://www.ncbj.org/
October 16-19, 2007
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Copley Place, Boston, Massachusetts
Contact: 312-578-6900; http://www.turnaround.org/
December 6-8, 2007
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Westin Mission Hills Resort, Rancho Mirage, California
Contact: 1-703-739-0800; http://www.abiworld.org/
March 25-29, 2008
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
Ritz Carlton Grande Lakes, Orlando, Florida
Contact: http://www.turnaround.org/
September 24-27, 2008
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Scottsdale, Arizona
Contact: http://www.ncbj.org/
October 28-31, 2008
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Copley Place, Boston, Massachusetts
Contact: 312-578-6900; http://www.turnaround.org/
October 5-9, 2009
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Desert Ridge, Phoenix, Arizona
Contact: 312-578-6900; http://www.turnaround.org/
2009 (TBA)
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Las Vegas, Nevada
Contact: http://www.ncbj.org/
October 4-8, 2010
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
JW Marriott Grande Lakes, Orlando, Florida
Contact: http://www.turnaround.org/
2010 (TBA)
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
New Orleans, Louisiana
Contact: http://www.ncbj.org/
BEARD AUDIO CONFERENCES
Coming Changes in Small Business Bankruptcy
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Distressed Real Estate under BAPCPA
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
High-Yield Opportunities in Distressed Investing
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Fundamentals of Corporate Bankruptcy and Restructuring
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Reverse Mergers - the New IPO?
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Dana's Chapter 11 Filing
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Employee Benefits and Executive Compensation
under the New Code
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Validating Distressed Security Portfolios: Year-End Price
Validation and Risk Assessment
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Changing Roles & Responsibilities of Creditors' Committees
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Calpine's Chapter 11 Filing
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Healthcare Bankruptcy Reforms
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Changes to Cross-Border Insolvencies
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
The Emerging Role of Corporate Compliance Panels
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com
BEARD AUDIO CONFERENCES
Privacy Rights, Protections & Pitfalls in Bankruptcy
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com
BEARD AUDIO CONFERENCES
High-Yield Opportunities in Distressed Investing
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com
The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday. Submissions via e-mail
to conferences@bankrupt.com are encouraged.
*********
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 ***