/raid1/www/Hosts/bankrupt/TCR_Public/061129.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, November 29, 2006, Vol. 10, No. 284
Headlines
ACURA PHARMA: Posts $3,097,000 Net Loss in Third Quarter 2006
ADELPHIA COMMS: ACC Sr. Noteholders Own $1.081 Bil. of Sr. Notes
ADELPHIA COMMS: Bracewell & Giuliani Represents Non-Agent Lenders
ADVOCAT INC: Earns $9.358 Million in Third Quarter Ended Sept. 30
AFFILIATED COMPUTER: S&P Puts 'B+' Credit Rating on Negative Watch
AGCO CORP: Launches $175 Million Senior Sub. Notes Plan Offering
ALASKA COMMS: Sept. 30 Balance Sheet Upside-Down by $25.2 Mil.
BASILONE OLIVER: Case Summary & 20 Largest Unsecured Creditors
BEAR STEARNS: S&P Puts Low-B Ratings on Six Certificate Classes
BETH ISRAEL: Court OKs $36.7MM Asset Purchase Pact with St. Mary's
BRICKMAN GRP: BG Holding Deal Cues S&P's 'B+' Corp. Credit Rating
BRIGHTPOINT INC: Earns $8.7 Mil. in Third Quarter Ended Sept. 30
BURGER KING: Earns $40 Million in Quarter Ended September 30
CHARMING CASTLE: Committee Wants Case Converted to Chapter 7
CHARMING CASTLE: Gets Interim Court Okay to Use Cash Collateral
CHESAPEAKE ENERGY: Launches EUR400 Million Senior Notes Offering
CLIENTLOGIC CORP: Moody's Affirms B3 Corporate Family Rating
COMMUNICATION INTELLIGENCE: Posts $669K Net Loss in 3rd Qtr. 2006
COMPLETE RETREATS: Agrees to Assume Client Pacts with Administaff
COMPLETE RETREATS: Wants Automatic Stay on M. Shelton Extended
DANA CORP: Equity & Creditor Panels Tap Berwin as European Counsel
DANA CORPORATION: Wants Dana Credit Settlement Agreement Approved
DELPHI CORP: Status Hearing on 1113/1114 Motion Scheduled Tomorrow
DELTA AIR: Meeting with Creditors Panel and US Airways this Week
DURA AUTOMOTIVE: Court Approves $300 Million DIP Financing
DURA AUTOMOTIVE: Gets Court's Final Nod To Use Cash Collateral
EASTON-BELL: Moody's Pares Corporate Family Rating to B2 from B1
ELECTRIC AQUAGENICS: Sept. 30 Balance Sheet Upside Down by $2.9MM
ENRON CORP: Court Approves Mediation of State Law Claims
ENTERGY NEW ORLEANS: Disclosure Statement Hearing on January 25
ENTERGY NEW ORLEANS: NRG Power Quits From Creditors Committee
EVANS INDUSTRIES: Wants to Hire Jones Walker as Special Counsel
FEDERAL-MOGUL: Mesothelioma Claimants Object to $500MM Settlement
FLINTKOTE CO: Court Extends Lease Decision Period to December 28
FORD MOTOR: $18BB New Financing Cues Fitch's 'B/RR4' Debt Rating
FORD MOTOR: S&P Junks Senior Unsecured Debt Issue Ratings
FRANKLIN MORTGAGE: Fitch Rates $7 Million Class B Certs. at BB+
GMAC LLC: GM Stake Sale Cues S&P to Upgrade Credit Rating to BB+
GREAT PLAINS: Earns $54.7 Million in Third Quarter of 2006
HILTON HOTELS: Seeks Modification of Partial Final Judgment
INNUITY INC: Posts $1.7 Million Net Loss in Quarter Ended Sept. 30
INTEGRATED ALARM: S&P Affirms 'B-' Second-Lien Debt Ratings
INTERSTATE BAKERIES: Brencourt Calls for Stockholders' Meeting
JABIL CIRCUIT: To Acquire All Shares of Taiwan Green Point
M. FABRIKANT & SONS: Quashes Speculations on Units' Bankruptcy
MAGSTAR TECHNOLOGIES: Earns $465,020 in Quarter Ended September 30
MAXCOM TELECOM: Moody's Rates Proposed $200 Mil. Sr. Notes at B3
MCKESSON CORP: Extends Pharmaceutical Agreement with Wal-Mart
MERIDIAN AUTOMOTIVE: Reschedules Confirmation Hearing to Dec. 6
MERIDIAN AUTOMOTIVE: Files Revised Plan Compendium Exhibits
MERIDIAN AUTOMOTIVE: Wants to Ink Deutsche Bank Commitment Letter
METROLOGIC INSTRUMENTS: Moody's Junks Proposed $75MM Credit Rating
MUSICLAND HOLDING: Panel's Claim Filing Period Extended to Jan. 31
NEW YORK IDA: Operating Deficit Cues S&P 'BB+' S. 1998 Bond Rating
OFFICEMAX INC: Earns $31.4 Million in 2006 Third Quarter
OWENS CORNING: Inks Stipulation Settling Wausau Insurance Claims
OWENS CORNING: Investors Report Ownership Of Owens Corning Stock
PERFORMANCE TRANSPORTATION: Hires PwC as Restructuring Tax Advisor
PRUDENTIAL ASSURANCE: Confirms Final Implementation of Scheme
Q.D. MT. AETNA: Case Summary & 12 Largest Unsecured Creditors
RADNOR HOLDINGS: Sells Substantially All Assets to TR Acquisition
REGENCY ENERGY: Moody's Rates Proposed Sr. Unsecured Notes at B2
RITE AID: To Withdraw Pacific Stock Exchange Listing, Retains NYSE
SATELITES MEXICANOS: First Amended Chapter Plan is Now Effective
SCOTTISH RE: $600 Mil. New Equity Deal Cues Fitch's Negative Watch
SCOTTISH RE: Stake Sale Deal Cues Moody's Continued Ratings Review
SKY DEVELOPERS: Voluntary Chapter 11 Case Summary
SOUTH STREET: Fitch Affirms Junk Ratings on $19MM Class B Notes
SOUTH STREET: Fitch Holds Rating on $45MM Class A-3 Notes at C
SPECIALTYCHEM PRODUCTS: IPP Buys ChemDesign's Closed Facility
STARDUST YACHTS: Case Summary & 20 Largest Unsecured Creditors
STEVE'S SHOES: Accord With Panel & Ohio Tax Department Approved
TIER TECHONLOGIES: Gets Fraud Complaint from Securities Holders
W.R. GRACE: Wants Court to Reject Speights & Runyanss Requests
W.R. GRACE: Selects Ogilvy Renault as Canadian Counsel
WASHINGTON MUTUAL: Fitch Lifts Low-B Ratings on Two Cert. Classes
* Brian Pass Joins Sheppard Mullin's Intellectual Property Group
* Upcoming Meetings, Conferences and Seminars
*********
ACURA PHARMA: Posts $3,097,000 Net Loss in Third Quarter 2006
-------------------------------------------------------------
Acura Pharmaceuticals Inc. reported a $3,097,000 net loss on zero
revenues for the quarterly period ended Sept. 30, 2006, against
$1,635,000 of net loss on zero revenues for the same period in
2005. Historically, the Company has incurred significant losses
and until the time as its product candidates are commercialized,
the Company is expected to continue incurring losses.
At Sept. 30, 2006, the Company's balance sheet showed $1,671,000
in total assets, $11,935,000 in total liabilities, and $10,264,000
in stockholders' equity deficit.
The Company's September 30 balance sheet also showed strained
liquidity with $470,000 in total current assets available to
pay $11,922,000 in total current liabilities. At Sept. 30, 2006,
the Company also had unrestricted cash and cash equivalents of
$200,000 and an accumulated deficit of $302.3 million, compared to
cash and cash equivalents of $300,000 and an accumulated deficit
of $291.6 million at Dec. 31, 2005.
The Company estimates that its current cash reserves will be
sufficient to fund the development of its Aversion Technology and
related operating expenses. To fund further operations and
product development activities, the Company must raise additional
financing or enter into alliances or collaboration agreements with
third parties resulting in cash payments to the Company relating
to its Aversion Technology.
Full-text copies of the Company's financial statements for the
quarterly period ended Sept. 30, 2006, are available for free at
http://researcharchives.com/t/s?15d8
Going Concern Doubt
As reported in the Troubled Company Reporter on Aug. 8, 2006,
BDO Seidman LLP expressed substantial doubt about Acura's
ability to continue as a going concern after auditing the
Company's 2005 financial statements. The auditing firm pointed to
the Company's recurring losses from operations and net capital
deficiency at Dec. 31, 2005.
About Acura Pharmaceuticals
Headquartered in Palatine, Illinois, Acura Pharmaceuticals, Inc.
(OTCBB:ACUR) -- http://www.acurapharm.com/-- is a specialty
pharmaceutical company engaged in research, development and
manufacture of innovative and proprietary abuse deterrent, abuse
resistant and tamper resistant formulations intended for use in
orally administered opioid-containing prescription analgesic
products. Acura is actively collaborating with contract research
organizations for laboratory and clinical evaluation and testing
of product candidates formulated with its Aversion(R) Technology.
ADELPHIA COMMS: ACC Sr. Noteholders Own $1.081 Bil. of Sr. Notes
----------------------------------------------------------------
Martin J. Bienenstock, Esq., at Weil, Gotshal & Manges LLP, in New
York, said that, as of Sept. 18, 2006, the ACC Senior Noteholders
are the beneficial owners of approximately $1,081,000,000 face
amount of Adelphia Communications Corporation's Senior Notes.
Weil Gotshal currently represents these ACC Senior Noteholders:
(1) Aurelius Capital Management, LP
53 Forest Avenue, Second Floor
Old Greenwich, CT 06870
(2) Banc of America Securities LLC
9 West 57th Street
New York, NY 10019
(3) Catalyst Investment Management Co., LLC
767 Third Avenue, 21st Floor
New York, NY 10017
(4) Drawbridge Global Macro Advisors LLC
1345 Avenue of the Americas
New York, NY 10105
(5) Drawbridge Special Opportunity Advisors LLC
1345 Avenue of the Americas
New York, NY 10105
(6) Elliott Associates, LP
712 Fifth Avenue
New York, NY 10019
(7) Farallon Capital Management, L.L.C.
One Maritime Plaza, Suite 1325
San Francisco, CA 94111
(8) Noonday Asset Management, L.P.
c/o Farallon Capital Management LLC
One Maritime Plaza, Suite 1325
San Francisco, CA 94111
(9) Perry Capital LLC
767 Fifth Avenue
New York, NY 10153
(10) Viking Global Investors LP
66 Railroad Avenue
Greenwich, CT 06830
Based in Coudersport, Pa., Adelphia Communications Corporation
(OTC: ADELQ) -- http://www.adelphia.com/-- is the fifth-largest
cable television company in the country. Adelphia serves
customers in 30 states and Puerto Rico, and offers analog and
digital video services, high-speed Internet access and other
advanced services over its broadband networks. The Company and
its more than 200 affiliates filed for Chapter 11 protection in
the Southern District of New York on June 25, 2002. Those cases
are jointly administered under case number 02-41729. Willkie Farr
& Gallagher represents the ACOM Debtors. PricewaterhouseCoopers
serves as the Debtors' financial advisor. Kasowitz, Benson,
Torres & Friedman, LLP, and Klee, Tuchin, Bogdanoff & Stern LLP
represent the Official Committee of Unsecured Creditors.
Adelphia Cablevision Associates of Radnor, L.P., and 20 of its
affiliates, collectively known as Rigas Manged Entities, are
entities that were previously held or controlled by members of the
Rigas family. In March 2006, the rights and titles to these
entities were transferred to certain subsidiaries of Adelphia
Cablevision, LLC. The RME Debtors filed for chapter 11 protection
on March 31, 2006 (Bankr. S.D.N.Y. Case Nos. 06-10622 through
06-10642). Their cases are jointly administered under Adelphia
Communications and its debtor-affiliates chapter 11 cases.
(Adelphia Bankruptcy News, Issue No. 150; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).
ADELPHIA COMMS: Bracewell & Giuliani Represents Non-Agent Lenders
-----------------------------------------------------------------
David Albalah, Esq., at Bracewell & Giuliani LLP, in New York,
disclosed that his firm represents the Ad Hoc Committee of Certain
Non-Agent Lenders of Adelphia Communications Corporation, which
currently comprises:
1. Citadel Investment Group, LLC
625 Madison Avenue, 15th Floor
New York, NY 10022
Attn: John Baylis
2. Latigo Partners, L.P.
590 Madison Avenue, 9th Floor
New York, NY 1002
Attn: Paul D. Malek
3. One East Capital Advisors, L.P.
900 Third Avenue, 11th Floor
New York, NY 10022
Attn: Sina Toussi
Based in Coudersport, Pa., Adelphia Communications Corporation
(OTC: ADELQ) -- http://www.adelphia.com/-- is the fifth-largest
cable television company in the country. Adelphia serves
customers in 30 states and Puerto Rico, and offers analog and
digital video services, high-speed Internet access and other
advanced services over its broadband networks. The Company and
its more than 200 affiliates filed for Chapter 11 protection in
the Southern District of New York on June 25, 2002. Those cases
are jointly administered under case number 02-41729. Willkie Farr
& Gallagher represents the ACOM Debtors. PricewaterhouseCoopers
serves as the Debtors' financial advisor. Kasowitz, Benson,
Torres & Friedman, LLP, and Klee, Tuchin, Bogdanoff & Stern LLP
represent the Official Committee of Unsecured Creditors.
Adelphia Cablevision Associates of Radnor, L.P., and 20 of its
affiliates, collectively known as Rigas Manged Entities, are
entities that were previously held or controlled by members of the
Rigas family. In March 2006, the rights and titles to these
entities were transferred to certain subsidiaries of Adelphia
Cablevision, LLC. The RME Debtors filed for chapter 11 protection
on March 31, 2006 (Bankr. S.D.N.Y. Case Nos. 06-10622 through
06-10642). Their cases are jointly administered under Adelphia
Communications and its debtor-affiliates chapter 11 cases.
(Adelphia Bankruptcy News, Issue No. 150; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).
ADVOCAT INC: Earns $9.358 Million in Third Quarter Ended Sept. 30
-----------------------------------------------------------------
Advocat Inc. reported net income of $9.358 million for the third
quarter ended Sept. 30, 2006, compared with net income of
$1.690 million for the same period in 2005.
The Company disclosed that it had entered into divestiture
transactions in recent periods, and the consolidated financial
statements for the three and nine month periods ended
Sept. 30, 2006, have been reclassified to present the transactions
as discontinued operations.
Operating income was $2.409 million for the three months ended
Sept. 30, 2006, versus $2.318 million for the three months ended
Sept. 30, 2005.
Patient revenues increased to $53.891 million in the quarter ended
Sept. 30, 2006, from $51.423 million for the same quarter in 2005,
an increase of $2.468 million, or 4.8%. The increase is due to
increased Medicaid rates in certain states, Medicare rate
increases, increased Medicare utilization and an increase in
census in 2006. The average rate of occupancy at its nursing
centers increased to 77.9% in 2006 from 76.5% in 2005. As a
percentage of total census, Medicare days increased to 13% in 2006
from 12.8% in 2005.
Income from continuing operations before income taxes was
$1.498 million in 2006, compared with $1.840 million in 2005. The
benefit for income taxes was $7.972 million in 2006, compared with
$177,000 in 2005.
Nine Months Ended Sept. 30, 2006
For the nine months ended Sept. 30, 2006, the Company reported a
net income of $19.327 million, compared with $12.132 million for
the same period in 2005.
Operating income for the nine months ended Sept. 30, 2006, was
$12.461 million, a decrease from $14.484 million for the
comparable period in 2005.
Patient revenues for the nine months ended Sept. 30, 2006,
increased to $160.973 million in 2006 from $149.914 million in
2005, an increase of $11.059 million, or 7.4%, due to increased
Medicaid rates in certain states, increased Medicare utilization,
Medicare rate increases and an increase in census in 2006 as
compared to 2005.
Income from continuing operations before income taxes was
$10.469 million in 2006 compared with income before income taxes
of $12.604 million in 2005.
Liquidity and Capital Resources
At Sept. 30, 2006, the Company's balance sheet showed
$94.868 million in total assets, $82.016 million in total
liabilities, and $7.934 million in total shareholders' equity.
The Company had a shareholders' deficit of $16.870 million at
Dec. 31, 2005.
The Company also disclosed that, as of Sept. 30, 2006, and for the
nine-month period then ended, it had no borrowings under its
working capital line of credit. The maximum outstanding balance
of the working capital line of credit is $2.3 million. The
working capital line of credit matures in January 2008 with
interest either at LIBOR plus 2.5% or the bank's prime rate plus
0.50%, up to a maximum of 9.5%.
Net cash provided by operating activities of continuing operations
before changes in other assets and liabilities totaled
$11.5 million and $8.1 million in the nine-month periods ended
Sept. 30, 2006 and 2005, respectively. Discontinued operations
provided cash of $200,000 and $600,000 in the nine month periods
ended Sept. 30, 2006 and 2005, respectively.
Investing activities of continuing operations provided cash of
$7.7 million in the nine months ended Sept. 30, 2006, and used
$7.9 million of cash for the same period in 2005.
Financing activities of continuing operations used cash of
$14.4 million in the nine-month period ended Sept. 30, 2006, and
provided cash of $2.2 million of cash for the comparable period in
2005. In 2006, proceeds from the sale of discontinued operations
were used to repay debt. The cash used in 2005 primarily
represents funds used to retire debt.
Facility Renovations
The Company disclosed that renovation projects on two facilities
were completed during the third quarter, and a third was completed
early in the fourth quarter, bringing the total number of
completed projects to four. The Company expects to complete two
additional projects in the first quarter of 2007, and its
management is reviewing plans to begin additional facility
renovations with the second round of financing completed with
Omega.
Accounts receivable attributable to patient services of continuing
operations totaled $20.7 million at Sept. 30, 2006, compared with
$18.6 million at Dec. 31, 2005, representing approximately 35 and
33 days in accounts receivable at each period end, respectively.
Full text-copies of Advocat's third quarter financials may be
viewed at no charge at http://ResearchArchives.com/t/s?15dc
Going Concern Doubt
As reported in the Troubled Company Reporter on April 3, 2006,
BDO Seidman LLP raised substantial doubt about Advocat Inc.'s
ability to continue as a going concern after it audited the
Company's financial statements for the year ended Dec. 31, 2005.
The auditing firm pointed to the Company's limited resources,
including working capital available to fund the reserve recorded
for retained professional liability risk and to meet its debt
service requirements during 2006.
About Advocat Inc.
Headquartered in Brentwood, Tennessee, Advocat Inc. (OTCBB: AVCA)
-- http://www.irinfo.com/-- provides long-term care services to
nursing home patients and residents of assisted living facilities
in nine states, primarily in the Southeast. The Company has 43
centers containing 4,505 licensed nursing beds.
AFFILIATED COMPUTER: S&P Puts 'B+' Credit Rating on Negative Watch
------------------------------------------------------------------
Standard & Poor's Ratings Services kept its ratings for Affiliated
Computer Services Inc. including the 'B+' corporate credit rating,
on CreditWatch, where they were placed with negative implications
on Sept. 29, 2006.
"ACS has announced that it has completed its internal
investigation into its historical stock option practices; in
response to the finding, the company's chief executive officer and
chief financial officer have resigned," said Standard & Poor's
credit analyst Philip Schrank.
Additionally, the company is continuing to review and evaluate the
results of the internal investigation to determine the accounting
consequences of the use of incorrect measurement dates during the
period from 1994 through 2005.
The company currently expects that the incremental cumulative
noncash compensation expense related to incorrect accounting
measurement dates will be approximately $51 million, plus
additional tax related expenses.
This estimate may increase or decrease when finalized. The
company has not yet determined the impact of these accounting
adjustments on its historical and current period consolidated
financial statements or on its assessment of effectiveness
of internal control over financial reporting, nor whether it will
be required to restate its consolidated financial statements as a
result of these adjustments.
Standard & Poor's will continue to monitor the progress being made
with regard to the filing of audited financial reports and
financial restatements, negotiations with lenders and other
triggering events that might cause a payment acceleration of ACS'
debentures, as well as the company's available sources of
liquidity.
Additionally, Standard & Poor's will review with new management
any changes to the strategy and corporate governance practices
that may stem from the management departures and internal
investigation.
Ratings List:
* Affiliated Computer Services Inc.
* Ratings Remain On Credit Watch
-- Corporate credit rating at B+/Watch Negative
-- Senior secured debt at B+/Watch Negative
AGCO CORP: Launches $175 Million Senior Sub. Notes Plan Offering
----------------------------------------------------------------
AGCO Corp. plans to offer $175 million aggregate principal amount
of convertible senior subordinated notes due 2036 through a public
offering. As part of the offering, AGCO will grant the
underwriters a 30-day option, solely to cover over-allotments, to
purchase up to an additional $26.25 million aggregate principal
amount of the notes. The interest rate, conversion price and
other terms of the notes will be determined by negotiations
between AGCO and the underwriters.
AGCO reported that it expects to use the net proceeds from the
offering of the notes to repay a portion of the term loans
outstanding under its existing bank credit agreement.
Morgan Stanley & Co. Inc. and Goldman, Sachs & Co. will act as
joint book-running managers for the offering of the notes. Rabo
Securities USA, Inc. and Lazard Capital Markets LLC are acting as
co-managers for the offering.
AGCO Corporation, headquartered in Duluth, Georgia, is a global
designer, manufacturer and distributor of agricultural equipment
and related replacement parts.
* * *
On Aug. 17, 2006, Moody's Investors Service affirmed AGCO
Corporation's Ba2 corporate family rating and B1 senior
subordinated rating, and changed the company's outlook to stable
from negative. The affirmation and change in outlook reflect
Moody's expectation that the company's successful cost reduction
and working capital management initiatives will support further
improvement in free cash flow and key credit metrics, despite the
severe slowdown in Latin American agricultural equipment markets
and the more moderate declines in North American and European
markets.
ALASKA COMMS: Sept. 30 Balance Sheet Upside-Down by $25.2 Mil.
--------------------------------------------------------------
Alaska Communications Systems Group Inc.'s balance sheet at
Sept. 30, 2006, showed $565,607,000 in total assets and
$590,834,000 in total liabilities, resulting in $25,227,000
stockholders' deficit.
For the three months ended Sept. 30, 2006, the company reported an
$8,720,000 net income on $90,376,000 of revenues compared with
$7,863,000 net loss on $85,701,000 of revenues for the comparable
period in 2005.
A full-text copy of the company's financial report for quarter
ended Sept. 30, 2006 is available for free at
http://ResearchArchives.com/t/s?15e5
Alaska Communications -- http://www.alsk.com/-- is an integrated
communications provider in Alaska, offering local telephone
service, wireless, long distance, data, and Internet services to
business and residential customers throughout Alaska.
BASILONE OLIVER: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Basilone Oliver Executive Search, Inc.
4840 McKnight Road, Suite 101
Pittsburgh, PA 15237
Bankruptcy Case No.: 06-25917
Type of Business: The Debtor is a search firm that helps both
employers and candidates
See http://www.basilone-oliver.com/
Chapter 11 Petition Date: November 24, 2006
Court: Western District of Pennsylvania (Pittsburgh)
Judge: Judith K. Fitzgerald
Debtor's Counsel: Kirk B. Burkley, Esq.
Robert S. Bernstein, Esq.
Bernstein Law Firm PC
2200 Gulf Tower 707, Grant Street
Pittsburgh, PA 15219
Tel: (412) 456-8100
Fax: (412) 456-8135
Total Assets: $440,789
Total Debts: $2,348,832
Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Floyd Robert Oliver Confession of $1,200,000
223 White Cedar Way Judgment
Aiken, SC 29803
State of Pennsylvania $1,000,000
Harrisburg, OA
Verizon Trade debt $1,362
US LEC Corp. Trade debt $1,348
MetLife Small Business Trade debt $1,170
Center
Nuvox Communications Trade debt $829
First Federal Leasing Trade debt $794
Talon Products Trade debt $724
Charlotte Chamber Trade debt $457
Chris Jones Trade debt $440
Sam's Club Trade debt $253
Charlotte IIA Chapter Trade debt $250
Office Depot Trade debt $226
The Berry Company Trade debt $213
Verizon Wireless Trade debt $182
Laserprint Trade debt $179
Bellsouth Advertising & Trade debt $136
Publishing Corp.
Larry Basilone Trade debt $120
Lanier Worldwide, Inc. Trade debt $112
Delage Landen Financial Trade debt $99
Services
BEAR STEARNS: S&P Puts Low-B Ratings on Six Certificate Classes
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to Bear Stearns Commercial Mortgage Securities Trust 2006-
PWR14's $2.5 billion commercial mortgage pass-through
certificates series 2006-PWR14.
The preliminary ratings are based on information as of Nov. 27,
2006. Subsequent information may result in the assignment of
final ratings that differ from the preliminary ratings.
The preliminary ratings reflect the credit support provided by the
subordinate classes of certificates, the liquidity provided by the
trustee, the economics of the underlying loans, and the geographic
and property type diversity of the loans.
Class A-1, A-2, A-3, A-AB, A-4, A-1A, A-M, and A-J are currently
being offered publicly. Standard & Poor's analysis determined
that, on a weighted average basis, the pool has a debt service
coverage of 1.34x, a beginning LTV of 99.9%, and an ending LTV of
90.4%. The rated final maturity date for these certificates is
Dec. 2038.
Preliminary Ratings Assigned
Bear Stearns Commercial Mortgage Securities Trust 2006-PWR14
Class Rating Preliminary Recommended
amount credit
support (%)
----- ------ ----------- -----------
A-1 AAA $114,700,000 30.00
A-2 AAA $170,700,000 30.00
A-3 AAA $68,900,000 30.00
A-AB AAA $125,050,000 30.00
A-4 AAA $950,942,000 30.00
A-1A AAA $297,407,000 30.00
A-M AAA $246,815,000 20.00
A-J AAA $222,132,000 11.00
X-1* AAA $2,468,142,608 N/A
X-2 AAA $2,414,574,000 N/A
B AA $46,278,000 9.125
C AA- $24,682,000 8.125
D A $37,022,000 6.625
E A- $21,596,000 5.750
F BBB+ $24,681,000 4.750
G BBB $24,682,000 3.750
H BBB- $24,681,000 2.750
J BB+ $9,256,000 2.375
K BB $6,170,000 2.125
L BB- $9,256,000 1.750
M B+ $3,085,000 1.625
N B $6,170,000 1.375
O B- $6,171,000 1.125
P NR $27,766,608 0.000
Interest-only class with a notional amount.
N/A -- Not applicable.
NR -- Not rated.
BETH ISRAEL: Court OKs $36.7MM Asset Purchase Pact with St. Mary's
------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of New Jersey gave Beth
Israel Hospital Association of Passaic authority to enter into a
"stalking horse" asset purchase agreement with St. Mary's for the
sale of substantially all the Debtor's assets and the assignment
of executory contracts and unexpired leases.
Pursuant to the asset purchase agreement, St. Mary's agreed to pay
$36,739,000 for the Debtor's property.
St. Mary's already provided an $875,000 good faith deposit
currently being held in the trust account of its counsel, $500,000
of which will be made available as a loan to the Debtor as part of
a debtor-in-possession financing.
St. Mary's also agreed to lend the Debtor up to an additional
$200,000 of its deposit in February 2007 if necessary to help the
Debtor cover certain operating expenses.
The Court gave St. Mary's until Dec. 31, 2006, to designate
executory contracts and unexpired leases to be assumed by the
Debtor and assigned to St. Mary's.
The Court directed the Debtor to file a notice of contract
designation, together with an amended cure amount schedule for the
assigned contracts and serve notice on all interested parties
within 10 days of the contract designation or no later than
Jan. 10, 2007.
Objections to the Debtor's contract designation or amended cure
amount schedule must be filed with the Court on or before Jan. 22,
2007.
The Court will convene a hearing on Jan. 29, 2007, at 10:00 a.m.
on any objections to the Debtor's contract designation or
amended cure amount schedule.
Auction Sale
The sale of the property to St. Mary's is subject to higher and
better offers through an auction to be held at the offices of Cole
Schotz, Meisel Forman & Leonard, P.A., 25 Main Street, in
Hackensack, New Jersey, on Dec. 7, 2006, at 10:00 a.m.
To participate in the auction, interested parties must:
-- submit a bid of at least $37,239,000, in increments of
$50,000; and
-- deliver an earnest money deposit to the Debtor's counsel
equal to 10% of the total proposed purchase price.
A successful bidder must be prepared to immediately substitute
$500,000 of its deposit for the $500,000 of debtor-in-possession
financing provided by St. Mary's and must be prepared to commit an
additional $200,000 of funds to the Debtor in February 2007
subordinate to the DIP Loan and prepetition indebtedness of
Commerce Bank, National Association.
St. Mary's right to a break-up fee in the event its purchase offer
is exceeded by a qualified bidder's bid will be determined by the
Court at a latter date upon application by St. Mary's.
A hearing to confirm the results of the auction sale will be
on December 11, 2006, 11:00 a.m. EST., before the Honorable
Novalyn L. Winfield at the United States Bankruptcy Court for the
District of New Jersey, Martin Luther King, Jr. Federal Building,
50 Walnut Street, in Newark, New Jersey,
Objections to the sale are due 4:00 p.m., E.S.T., on Dec. 7, 2006.
Interim DIP Financing
On Nov. 13, 2006, the Court authorized the Debtor, on an interim
basis, to obtain up to $5 million in debtor-in-possession
financing.
The term sheet on the DIP Financing contains conditions tied
to the sale of the Debtor's property, including designation of St.
Mary's as stalking-horse bidder.
Commerce Bank, as the lead lender under the DIP Financing will
provide half of the DIP loan amount. The balance will be provided
by other parties including St. Mary's.
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.
Allison M. Berger, Esq., and Hal L. Baume, Esq., at Fox Rothschild
LLP represent the Official Committee of Unsecured Creditors. When
the Debtor filed for protection from its creditors, it estimated
assets and debts between $50 million and $100 million.
BRICKMAN GRP: BG Holding Deal Cues S&P's 'B+' Corp. Credit Rating
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on
Gaithersburg, Maryland-based The Brickman Group Ltd.
The corporate credit rating was lowered to 'B+' from 'BB-'. At
the same time, the ratings were placed on CreditWatch with
negative implications.
These rating actions comes after the company's disclosure that it
will merge with BG Holding LLC, a holding company sponsored by
GEI, a private equity investment fund. The transaction will be
partially financed with $575 million in incremental debt.
Pro forma for this transaction, the company will be very highly
leveraged, with estimated total debt to EBITDA at well more than
7.0x, versus average total debt to EBITDA of about 3.4x for the 12
months ended June 30, 2006.
Standard & Poor's will meet with management to discuss its
operational and financial strategies following the merger.
BRIGHTPOINT INC: Earns $8.7 Mil. in Third Quarter Ended Sept. 30
----------------------------------------------------------------
Brightpoint Inc. reported net income of $8.7 million for the
third quarter ended Sept. 30, 2006, compared with a net loss of
$6.1 million for the same period in 2005 due to a $14.4 million
total loss from discontinued operations.
Total revenue increased 16% to $633.7 million for the three months
ended Sept. 30, 2006, from $544.9 million for the same period in
the prior year.
At Sept. 30, 2006, the Company's balance sheet showed
$686.178 million in total assets, $509.359 million in total
liabilities, and $176.819 million in total shareholders' equity.
Financing Activities of Subsidiaries
The Company disclosed that, in April 2006, the credit facility
utilized by its primary operating subsidiary in the Philippines,
Brightpoint Philippines Inc., matured and was not renewed. In
addition, the credit facility utilized by its primary operating
subsidiary in the Slovak Republic, Brightpoint Slovakia s.r.o.,
matured in May 2006 and was not renewed.
In August 2006, Brightpoint Slovakia s.r.o. entered into a credit
facility with Vseobecna uverova banka, a.s. The facility, which
matures in August 2007, provides borrowing availability of up to a
maximum of $21 million, bears interest at the one- month Libor
rate plus 0.60% and is supported by a guarantee from the Company.
The Facility, at Sept. 30, 2006, had no amounts outstanding.
The Company also disclosed that Brightpoint North America L.P.
entered into an agreement with GE Capital in 2001, which has been
amended in October 2006. The amendment, among other things,
allows the Company to request an increase in aggregate commitments
of up to $40 million, and it lowers the fixed charge coverage
ratios to be maintained before causing a change in the level of
applicable margin to be added to the applicable interest rate.
Significant Purchase of Wireless Device
In September 2006, the Company further disclosed that, it made a
significant purchase of wireless device inventory as part of its
expanded global relationship with a major original equipment
manufacturer. The wireless devices were procured under the terms
of an existing supply agreement in the Philippines. However, the
Company intends to sell the products through all of its
international operations including outside the Asia-Pacific
region. The purchase will be funded using cash generated from the
sale the product.
Full-text copies of Company's third quarter financials may be
viewed at no charge at http://ResearchArchives.com/t/s?15de
Headquartered in Plainfield, Indiana, Brightpoint, Inc.
-- http://www.brightpoint.com/-- engages in the distribution of
wireless devices and accessories, as well as provision of
customized logistic services to the wireless industry. The
Company primarily operates in Australia, Colombia, Finland,
Germany, India, New Zealand, Norway, the Philippines, the Slovak
Republic, Sweden, United Arab Emirates and the United States. The
Company's customers include mobile operators, mobile virtual
network operators, resellers, retailers and wireless equipment
manufacturers. Brightpoint was incorporated in 1989 under the
name Wholesale Cellular USA, Inc. and changed its name to
Brightpoint Inc. in 1995.
* * *
On April 12, 2006, Standard & Poor's placed the Company's long-
term local and foreign issuer credit ratings at BB- with a stable
outlook.
BURGER KING: Earns $40 Million in Quarter Ended September 30
------------------------------------------------------------
Burger King Corporation reported a $40,000,000 net income on
$546,000,000 of revenues for the three months ended Sept. 30,
2006, versus a $22,000,000 net income on $508,000,000 of revenues
for the three months ended Sept. 30, 2005.
The increase in net income is primarily the result of:
* an increase in revenues of $38 million;
* an increase in operating costs and expenses of $33 million;
* a $5 million pre-tax gain from the sale of our investment in
a joint venture;
* a benefit of $12 million due to a pre-tax loss on early
extinguishment of debt of $13 million recorded in the first
quarter of the prior year; and
* a $4 million increase in income tax expense.
At Sept. 30, 2006, the Company's balance sheet showed
$2,413,000,000 in total assets and $1,814,000,000 in total
liabilities resulting in a stockholders' equity of 599,000,000.
On Oct. 6, 2006, the Company prepaid an additional $35 million of
term debt, reducing the total outstanding debt balance to
$912 million. As a result of this payment, the next scheduled
principal payment on the amended facility is March 31, 2009.
Full-text copies of the Company's financial statements for the
quarter ended Sept. 30, 2006, are available for free at:
http://ResearchArchives.com/t/s?15ea
Headquartered in Miami, Florida, The Burger King --
http://www.burgerking.com/-- operates more than 11,000
restaurants in more than 60 countries and territories worldwide.
Approximately 90% of Burger King restaurants are owned and
operated by independent franchisees, many of them family owned
operations that have been in business for decades. Burger King
Holdings Inc., the parent company, is private and independently
owned by an equity sponsor group comprised of Texas Pacific Group,
Bain Capital and Goldman Sachs Capital Partners.
* * *
As reported in the Troubled Company Reporter on Oct. 17, 2006,
in connection with Moody's Investors Service's implementation of
its new Probability-of-Default and Loss-Given-Default rating
methodology for the restaurant sector, the rating agency revised
its Corporate Family Rating for Burger King Corporation to Ba3
from Ba2.
Additionally, Moody's held its Ba2 ratings on the Company's
$150 million Senior Secured Revolver Due 2011 and $250 million
Senior Secured Term Loan A Due 2011. Moody's assigned those loan
facilities an LGD3 rating suggesting lenders will experience a 35%
loss in the event of default.
CHARMING CASTLE: Committee Wants Case Converted to Chapter 7
------------------------------------------------------------
The Official Committee of Unsecured Creditors of Charming Castle
LLC asks the U.S. Bankruptcy Court for the Northern District of
Alabama to convert the Debtor's chapter 11 proceeding to a chapter
7 liquidation.
The Committee tells the Court that although there has not been a
complete cessation of the Debtor's business operations, its
business is no longer viable. In addition, the Committee contends
that the Debtor is incurring administrative costs and operational
costs, which results in a diminution of the estate assets.
Further, the Committee avers, property of the estate, including
machinery, inventory and equipment located at the Debtor's
manufacturing facilities, is rapidly declining in value.
The Committee believes that in its current state, there is no
possibility that the Debtor can successfully rehabilitate because
the Debtor simply does not have the money to operate and ensure a
rehabilitation of the business.
In lieu of permitting the Debtor to continue to dissipate estate
assets which would otherwise be available to pay unsecured
creditors, the Committee says that this case should be converted
to chapter 7, and a trustee should be appointed to collect,
liquidate and distribute estate property and expeditiously close
the estate.
Headquartered in Hackleburg, Alabama, Charming Castle LLC, dba
Indies House -- http://www.indieshouse.net/-- manufactures mobile
homes. The Company filed for chapter 11 protection on Oct. 5,
2006 (Bankr. N.D. Ala. Case No. 06-71420). Robert L. Shields,
III, Esq., at the Shields Law Firm represents the Debtor in its
restructuring efforts. Burr & Forman LLP represents the Official
Committee of Unsecured Creditors. When the Debtor filed for
protection from its creditors, it listed estimated assets of less
than $50,000 but estimated debts between $10 million and
$50 million. The Debtor's exclusive period to file a chapter 11
expires on Feb. 2, 2007.
CHARMING CASTLE: Gets Interim Court Okay to Use Cash Collateral
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Alabama
gave its interim approval for Charming Castle LLC to use the cash
collateral securing repayment of its obligations to First National
Bank of Jasper.
First National holds a perfected security interest in the Debtor's
assets securing the $1,435,000 prepetition loan it extended to the
Debtor.
In its request, as published in the Troubled Company Reporter on
Nov. 7, 2006, the Debtor told the Court that it has to obtain
funds immediately in order to continue operation and to meet
current expenses and to enhance a successful reorganization or
liquidation. The Debtor believed that its request for cash
collateral is fair and reasonable in any circumstances.
The Court will convene a hearing on Dec. 14, 2006, at 1:30 p.m.,
to consider, on a final basis, the Debtor's request.
Headquartered in Hackleburg, Alabama, Charming Castle LLC, dba
Indies House -- http://www.indieshouse.net/-- manufactures mobile
homes. The Company filed for chapter 11 protection on Oct. 5,
2006 (Bankr. N.D. Ala. Case No. 06-71420). Robert L. Shields,
III, Esq., at the Shields Law Firm represents the Debtor in its
restructuring efforts. Burr & Forman LLP represents the Official
Committee of Unsecured Creditors. When the Debtor filed for
protection from its creditors, it listed estimated assets of less
than $50,000 but estimated debts between $10 million and
$50 million. The Debtor's exclusive period to file a chapter 11
expires on Feb. 2, 2007.
CHESAPEAKE ENERGY: Launches EUR400 Million Senior Notes Offering
----------------------------------------------------------------
Chesapeake Energy Corp. intends to commence a public offering of
EUR400 million of a new issue of senior notes due 2017.
Chesapeake intends to use the net proceeds from the offering to
repay outstanding indebtedness under its revolving credit
facility.
The senior notes will be offered pursuant to an effective
registration statement filed with the U.S. Securities and Exchange
Commission. Chesapeake intends to list the notes on
the Irish Stock Exchange for trading on its Alternative Securities
Market.
Chesapeake is an Oklahoma City-based company focused on the
exploration, production and development of natural gas. The
company's proved reserves remain predominantly natural gas and
are based 100% in North America. Chesapeake's operations are
concentrated primarily in the Mid-Continent, South Texas, the
Permian Basin, and the Appalachia Basin. The company's reserve
growth in recent years reflects the company's aggressive
acquisition strategy and consistent success through the drill-bit.
* * *
Moody's Investors Service held its Ba2 rating on Cheseapeak
Energy's 7.75% Sr. Unsec. Gtd. Global Notes due 2015, 7.5% Sr.
Unsec. Gtd. Global Bonds due 2013, 6.875% Sr. Unsec. Gtd. Global
Notes due 2016, and 7.5% Sr. Unsec. Global Notes due 2014. The
debentures were assigned an LGD4 rating suggesting noteholders
will experience a 60% loss in the event of default.
CLIENTLOGIC CORP: Moody's Affirms B3 Corporate Family Rating
------------------------------------------------------------
Moody's Investors Service affirmed ClientLogic Corporation's B3
corporate family rating after the disclosure of its plan to merge
with SITEL Corporation.
Concurrently, Moody's has withdrawn the B1 rating on ClientLogic's
former $122 million first lien bank credit facility and Caa1
rating on the company's former $35 million second lien bank credit
facility, both of which have been refinanced.
The rating outlook is stable.
Under the terms of the proposed merger, a newly formed subsidiary
of ClientLogic will merge with SITEL and pay $4.05 per share in
cash for all of the outstanding common stock of SITEL.
The transaction, which Clientlogic expects to be completed in the
first quarter of 2007, is subject to customary closing conditions,
including shareholder approval and regulatory clearances.
Moody's will continue to focus on the firm's prospective
capitalization, free cash flow, and earnings following the merger,
including the potential for expense reduction.
Headquartered in Nashville, Tennessee, ClientLogic Corporation
provides outsourced call center services worldwide.
COMMUNICATION INTELLIGENCE: Posts $669K Net Loss in 3rd Qtr. 2006
-----------------------------------------------------------------
Communication Intelligence Corporation reported a $669,000 net
loss on $701,000 of revenues for the three months ended Sept. 30,
2006, versus a $1,569,000 net loss on $607,000 of revenues for the
three months ended Sept. 30, 2005.
At Sept. 30, 2006, the Company's balance sheet showed $6,305,000
in total assets and $2,157,000 in total liabilities resulting in a
stockholders' equity of $4,078,000.
Full-text copies of the Company's financial statements for the
quarter ended Sept. 30, 2006, are available for free at:
http://ResearchArchives.com/t/s?15ed
Going Concern Doubt
Stonefield Josephson, Inc. expressed substantial doubt about
Communication Intelligence's ability to continue as a going
concern after it audited the Company's financial statements for
the years ended Dec. 31, 2005 and 2004. The auditing firm pointed
to the Company's significant recurring operating losses and
accumulated deficit.
Based in Redwood Shores, California, Communication Intelligence
Corporation -- http://www.cic.com/-- supplies electronic
signature solutions for business process automation in
the Financial Industry and a leader in biometric signature
verification. CIC's products enable companies to achieve
paperless workflow in their eBusiness processes by enabling them
with "The Power to Sign Online(R)" with multiple signature
technologies across virtually all applications. Industry leaders
such as AIG, Charles Schwab, Prudential, Nationwide (UK) and Wells
Fargo chose CIC's products to meet their needs. CIC sells
directly to enterprises and through system integrators, channel
partners and OEMs.
COMPLETE RETREATS: Agrees to Assume Client Pacts with Administaff
-----------------------------------------------------------------
In a stipulation approved by the U.S. Bankruptcy Court for the
District of Connecticut, Complete Retreats LLC and its debtor-
affiliates agree to assume their client service agreements with
Administaff Companies II, L.P.
As reported in the Troubled Company Reporter on Sept. 22, 2006,
Administaff Companies asked the Court to compel the Debtors to
assume or reject two client service agreements the Debtors entered
into with Administaff.
Administaff serves as a full-service human resources department
for small and medium-sized businesses throughout the United
States. Administaff delivers personnel management services by
entering into a co-employment relationship with a client company
and its existing employees.
Before the Debtors' bankruptcy filing, Administaff entered into
two client service agreements with Debtors Preferred Retreats
Design Group, LLC, and Preferred Retreats, LLC. The Client
Service Agreements were effective as of Jan. 24, 2004, and
Dec. 27, 2003. The terms of the Agreements are continuous until
either Administaff or the Debtors terminate them in accordance
with their terms.
Pursuant to the Agreements, Administaff:
-- acts as co-employer of the Debtors' employees;
-- pays the salaries and wages of the Debtors' employees; and
-- provides other personnel management services to the
Debtors.
If the Debtors decided to assume the Service Agreements,
Administaff asks the Court to require the Debtors to provide
adequate assurance of future performance by prepaying all
salaries, wages, and charges in advance of the first pay day of
each payroll period.
In Administaff's behalf, Daniel E. Bruso, Esq., at Cantor Colburn
LLP, in Bloomfield, Connecticut, explained that Administaff pays
the salaries and wages of the Debtors' employees in arrears on a
bi-weekly basis. All payroll checks are drawn on Administaff's
account and Administaff collects its fee to cover wages and other
costs for each pay period by drafting on the Debtors' account when
the payroll is run. As a result, Administaff incurs financial
obligations of approximately $480,000 per pay period before it is
paid by the Debtors.
Mr. Bruso asserted that Administaff continues to incur liability
to the Debtors' employees but have no adequate assurance that the
Debtors will continue to pay their obligations to Administaff.
The Debtors, in November 2006, sought the Court's authority to
file a motion to assume, assume and assign or reject the Service
Agreements no later than Jan. 16, 2007.
The Debtors believe that Preferred Retreats LLC and Preferred
Retreats Design Group, L.L.C., are current on their obligations
under their client service agreements with Administaff Companies
II, L.P.
Jeffrey K. Daman, Esq., at Dechert LLP, in Hartford, Connecticut,
told the Court that the Debtors are willing to prepare a motion
either to assume or to reject the Service Agreements within "a
reasonable time", presumably around mid January 2007. The Debtors
averred that this amount of time is reasonable, especially in
light of the fact that they are current on their obligations under
the Service Agreements.
About Complete Retreats
Headquartered in Westport, Connecticut, Complete Retreats LLC
operates five-star hospitality and real estate management
businesses. In addition to its mainline destination club
business, the Debtor also operates an air travel program for
destination club members, a villa business, luxury car rental
services, wine sales services, fine art sales program, and other
amenity programs for members.
Complete Retreats and its debtor-affiliates filed for chapter 11
protection on July 23, 2006 (Bankr. D. Conn. Case No. 06-50245).
Nicholas H. Mancuso, Esq. and Jeffrey K. Daman, Esq. at Dechert
LLP represent the Debtors in their restructuring efforts. Michael
J. Reilly, Esq., at Bingham McCutchen LP, in Hartford,
Connecticut, serves as counsel to the Official Committee of
Unsecured Creditors. No estimated assets have been listed in the
Debtors' schedules, however, the Debtors disclosed $308,000,000 in
total debts.
The Debtors' exclusive period to file a plan expires on
February 18, 2007. They have until April 19, 2007, to solicit
acceptance to that plan. (Complete Retreats Bankruptcy News,
Issue No. 15; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
COMPLETE RETREATS: Wants Automatic Stay on M. Shelton Extended
--------------------------------------------------------------
On Oct. 19, 2006, Robert Glanville, Lewis A. Halpert and Jonathan
E. Walner, members of Debtor Distinctive Retreats II, LLC, filed
an action in the Superior Court of the State of Connecticut,
Judicial District of Stamford/Norwalk, against:
* Michael Shelton, an executive vice president of business
development of Preferred Retreats Design Group, LLC, and an
officer and member of the board of managers of each of
Complete Retreats LLC and its debtor-affiliates' operating
companies; and
* Robert L. McGrath, the Debtors' founder and former chief
executive officer.
In the State Court Action, the Plaintiffs seek to recover from
Mr. Shelton more than $1,300,000, the purported amount of their
membership deposit claims against the Debtors, on the basis of
alleged misrepresentations made by Mr. Shelton as a
representative of the Debtors.
The claims alleged in the State Court Action are in essence the
same claims asserted by the Plaintiffs against the Debtors,
Jeffrey K. Daman, Esq., at Dechert LLP, in Hartford, Connecticut,
notes. Consequently, a judgment against Mr. Shelton would
detrimentally affect the assets of the Debtors' estates.
Pursuant to Sections 105(a) and 362 of the Bankruptcy Court, the
Debtors ask the U.S. Bankruptcy Court for the District of
Connecticut to:
(a) extend the Section 362(a) automatic stay protections to
Mr. Shelton for the State Court Action; and
(b) provide that if a party wishes to perform any actions
contemplated by Section 362(a) with respect to or against
Mr. Shelton, that party must seek the Court's permission
for relief from the automatic stay.
Mr. Shelton is a key participant in the Debtors' reorganization
efforts, Mr. Daman relates. Mr. Shelton is a member of the
management team most knowledgeable about the destination club
industry, competitive positioning, and pricing:
-- who has assumed a lead role on the Debtors' senior
management team in formulating the business plan upon which
the Debtors' reorganization efforts are based; and
-- who has been actively engaged in discussions and
negotiations with potential investors in the Debtors and in
working with those investors to formulate and enhance the
Debtors' investment proposals.
Mr. Daman contends that the State Court Action's pendency
seriously threatens to distract Mr. Shelton from the performance
of his critical duties, which places the Debtors' current and
future prospects at great risk.
"Any party wishing to assert alleged claims against Mr. Shelton
would not be barred from doing so, but rather would be required
to satisfy the requirements of Section 362(a) before commencing
or continuing any action," Mr. Daman clarifies.
About Complete Retreats
Headquartered in Westport, Connecticut, Complete Retreats LLC
operates five-star hospitality and real estate management
businesses. In addition to its mainline destination club
business, the Debtor also operates an air travel program for
destination club members, a villa business, luxury car rental
services, wine sales services, fine art sales program, and other
amenity programs for members.
Complete Retreats and its debtor-affiliates filed for chapter 11
protection on July 23, 2006 (Bankr. D. Conn. Case No. 06-50245).
Nicholas H. Mancuso, Esq. and Jeffrey K. Daman, Esq. at Dechert
LLP represent the Debtors in their restructuring efforts. Michael
J. Reilly, Esq., at Bingham McCutchen LP, in Hartford,
Connecticut, serves as counsel to the Official Committee of
Unsecured Creditors. No estimated assets have been listed in the
Debtors' schedules, however, the Debtors disclosed $308,000,000 in
total debts.
The Debtors' exclusive period to file a plan expires on
February 18, 2007. They have until April 19, 2007, to solicit
acceptance to that plan. (Complete Retreats Bankruptcy News,
Issue No. 15; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
DANA CORP: Equity & Creditor Panels Tap Berwin as European Counsel
------------------------------------------------------------------
The Official Committee of Equity Security Holders and the
Official Committee of Unsecured Creditors in Dana Corporation and
its debtor-affiliates' chapter 11 cases believe that the
Debtors' bankruptcy proceedings in the United States are
intertwined with their European businesses. The Committees
contend that the United States bankruptcy proceedings will likely
give rise to complex legal issues involving the European
subsidiaries.
Thus, the Committees seek the U.S. Bankruptcy Court for the
Southern District of New York's authority to retain Berwin
Leighton Paisner, LLP, as their joint special European counsel,
nunc pro tunc to November 1, 2006.
As special European counsel, Berwin will, among other things,
advise the Committees with respect to the assets, liabilities,
financial condition, and legal issues surrounding any of the
businesses of the Debtors' European affiliates that may be
relevant to the Chapter 11 Cases.
Berwin will be paid in its hourly rates, subject to a 10%
reduction:
Professional Hourly Rates
------------ ------------
Partners GBP440 to GBP500
Senior Associates GBP300 to GBP385
Junior Associates GBP170 to GBP280
Trainees GBP120 to GBP130
Berwin will also be compensated for reasonable out-of-pocket
expenses it incurs.
David Uri Lebowitz, Esq., at Berwin Leighton Paisner, LLP,
assures the Court that his firm is a "disinterested person" as
the term is defined in Section 101(14) of the Bankruptcy Code,
and does not represent any interest adverse to the Committees.
About Dana Corporation
Toledo, Ohio-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). As of
Sept. 30, 2005, the Debtors listed $7,900,000,000 in total assets
and $6,800,000,000 in total debts.
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. Fried,
Frank, Harris, Shriver & Jacobson, LLP serves as counsel to the
Official Committee of Equity Security Holders. Stahl Cowen
Crowley, LLC serves as counsel to the Official Committee of Non-
Union Retirees.
The Debtors' exclusive period to file a plan expires on Jan. 3,
2007. They have until Mar. 5, 2007, to solicit acceptances to
that plan.
(Dana Corporation Bankruptcy News, Issue No. 27; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000).
DANA CORPORATION: Wants Dana Credit Settlement Agreement Approved
-----------------------------------------------------------------
Dana Credit Corporation, non-debtor subsidiary of Dana
Corporation, has provided lease financing services in selected
markets. From time to time, Dana Credit issues notes. As of
Nov. 15, 2006, the aggregate principal amount of DCC Notes
outstanding is approximately $399,000,000.
In late 2001, Dana and its debtor-affiliates decided to
discontinue Dana Credit's business and in the last four years, the
company has sold a significant portion of its assets. Dana
Credit's remaining assets include:
* a lease portfolio valued between $165,000,000 and
$265,000,000;
* cash on hand aggregating $85,000,000; and
* claims against the Debtors, totaling more than $484,100,000.
Intercompany Claims
The Debtors and its non-debtor subsidiaries, including Dana
Credit, file consolidated federal tax returns and consolidated or
combined state tax returns. Where allowable, tax benefits and
liabilities between the Debtors and Dana Credit are computed
under an intercompany tax sharing agreement. Under the Tax
Sharing Agreement, each year Dana Credit recognizes tax benefits
and liabilities for the estimated taxes refundable from or
payable to the Debtors using a method referred to as the
"benefits for loss companies" method, Robert J. Feinstein, Esq.,
at Pachulski Stang Ziehl Young Jones & Weintraub, LLP, in New
York, relates.
As Dana Credit sells its assets, gains will be realized. If the
Tax Sharing Agreement were to remain in place during Dana
Credit's entire wind-down, the amount the Debtors owe Dana Credit
would be reduced by the taxes due on the amount of gains to be
realized on the sale of Dana Credit's assets, Mr. Feinstein says.
The Debtors and Dana Credit are also parties to several other
agreements and transactions:
(a) Pursuant to promissory notes dated Aug. 16, 2004, Feb. 18,
2005, and July 1, 2005, made by the Debtors, Dana Credit
asserts that the Debtors owe it, as of the Debtors'
bankruptcy filing, $291,106,458 in the aggregate, plus
costs and expenses, including attorneys' fees.
(b) Pursuant to an operating agreement between the Debtors and
Dana Credit, dated May 23, 1995, Dana Credit asserts that
it has contingent and unliquidated claims against the
Debtors.
(c) In 2003 and 2005, Dana Credit transferred $100,000,000 in
the aggregate to the Debtors in the form of dividends.
Although the financial statements produced at that time
indicated that Dana Credit had sufficient net assets with
which to pay the dividends, the DCC Noteholders have
asserted that Dana Credit may not have had the requisite
net assets with which to have made some or all of the
dividends. Therefore, Dana Credit and the DCC Noteholders
assert that Dana Credit has a contingent and unliquidated
claim against the Debtors for the return of the dividends.
(d) Dana Credit asserts that the Debtors owe it $2,349,457 for
invoices it paid on the Debtors' behalf for work performed
at the Hopkinsville, Kentucky facility.
(e) Dana Credit asserts it placed $1,000,000 in escrow for the
Debtors' benefit with respect to work performed at the
Owensboro, Kentucky facility. Dana Credit maintains that
the $1,000,000 was to be returned when the Debtors will
have paid the liens with respect to which the money was
escrowed. Thus, Dana Credit asserts a contingent and
unliquidated claim for any money in escrow that has not
been returned to it.
(f) At the closing of a sale of a Lucas County, Ohio land owed
by the Debtors to Promedica Health System, Inc., Dana
Credit received $1,000,000 and the Debtors received
$6,085,845. The amounts were placed in escrow until the
Debtors and Dana Credit could determine how the sale
proceeds should be allocated between them. Dana Credit
asserts that it is entitled to all of the money in escrow,
resulting in a $6,085,845 claim, plus interest. Dana
Credit also asserts that the Debtors owe it $277,620
prepetition and $432,981 postpetition for usage of the
Lucas County property.
In sum, Dana Credit asserted these claims against the Debtors:
Claim Description Claim Amount
----------------- ------------
Intercompany Notes as of March 2006 $291,000,000
Dividends paid in 2003 and 2005 100,000,000
Tax Sharing Agreement as of March 2006 72,000,000
Lease and ordinary course payments 8,300,000
Hopkinsville, Kentucky Facility improvements 1,600,000
Operating Agreement Unliquidated
------------
Total Prepetition Claim $472,900,000
Lucas County and Owensboro escrow accounts $7,100,000
Postpetition Hopkinsville lease 4,100,000
------------
Total Administrative Claim $11,200,000
After the Debtors' bankruptcy filing, holders of a majority of the
outstanding principal amount of the DCC Notes formed an Ad Hoc
Committee and asserted that because of the Debtors' bankruptcy,
the DCC Notes have become immediately due and payable. The Ad Hoc
Committee adds that the Noteholders have direct claims against the
Debtors because the Debtors controlled Dana Credit for their own
benefit and to the detriment of Dana Credit's creditors by, among
other things, making dividend payments when Dana Credit may have
been insolvent. Furthermore, the Ad Hoc Committee asserts that
the Tax Sharing Agreement is one-sided.
To resolve the issues outstanding between them, the Debtors, Dana
Credit and the Ad Hoc Committee engaged in negotiations and
eventually agreed to enter into a settlement.
The salient terms of the Settlement Agreement are:
(1) Dana Credit and the DCC Noteholders have agreed on the
terms of a Forbearance Agreement pursuant to which
signatory DCC Noteholders will release all claims they may
have against the Debtors and will not exercise rights or
remedies under the DCC Note documents during the
Forbearance Period. A condition of the Forbearance
Agreement is the settlement of the claims asserted by Dana
Credit against the Debtors and the settlement of certain
claims the Debtors asserted against Dana Credit.
(2) The Intercompany Claim will be allowed in the aggregate
amount of $325,000,000 and will not be subject to
reduction for any reason, including, without limitation,
on account of any right of setoff or recoupment. The
Intercompany Claim may not be amended at any time and,
except for the Intercompany Claim, Dana Credit will not
assert any other prepetition claims against any of the
Debtors.
(3) If Dana Credit intends to sell, assign or participate all
or a portion of the Intercompany Claim before the
effective date of a plan of reorganization, Dana Credit
must provide notice of the Proposed Sale and otherwise
follow the procedures for a proposed sale as provided for
in the Settlement Agreement.
(4) The Tax Sharing Agreement will be deemed terminated as of
the Settlement Effective Date.
(5) Dana Credit will waive and release any claims against the
Debtors for amounts due to it after the Debtors' bankruptcy
filing and through the Settlement Effective Date.
(6) After the Settlement Effective Date, the Debtors and Dana
Credit will settle their net intercompany claims on a
monthly basis.
(7) Dana Credit will consent to the release to the Debtors of
the currently escrowed proceeds from the sale of the
Lucas County and Owensboro properties and will waive any
right to receive any portion of the proceeds from the
escrow accounts.
(8) The time for the Debtors to assume or reject unexpired
non-residential real property leases with Dana Credit is
extended until the date of entry of an order confirming a
plan in their Chapter 11 cases.
A full-text copy of the Dana Credit Settlement is available for
free at http://researcharchives.com/t/s?15ec
The Settlement Agreement provides a mechanism to maximize the
value of Dana Credit's assets, benefiting the Debtors and their
creditors and equity holders, Mr. Feinstein contends. On the
contrary, litigating the issues resolved by the Settlement
Agreement and the Forbearance Agreement would take substantial
time and resources.
Mr. Feinstein adds that the Forbearance Agreement, which is
conditioned on the effectiveness of the Settlement Agreement,
allows Dana Credit to avoid filing a Chapter 11 petition. The
Debtors believe that the DCC Notes will be paid sooner if Dana
Credit remains out of bankruptcy. "The faster the DCC Notes are
paid, the less interest expense Dana Credit will have to pay and
the more likely it is that only a portion of the Intercompany
Claim will be needed to satisfy the DCC Noteholders' claims," Mr.
Feinstein says.
Accordingly, the Debtors ask the Court to approve their
Settlement Agreement with Dana Credit.
Great-West Responds
Great-West Life & Annuity Insurance Company and The Great-West
Life Assurance Company are DCC Noteholders who are not currently
part of the Ad Hoc Committee. The Great-West Entities commenced
a lawsuit against Dana Credit in the United States District Court
for the Northern District of Illinois for nonpayment of principal
and accrued interest on their DCC Notes, which were due in April
2006. The District Court ruled in favor of the plaintiffs and
entered a judgment against Dana Credit totaling $7,246,050, plus
interest.
Joshua Dorchak, Esq., at Bingham McCutchen, LLP, in New York,
informs Judge Lifland that Dana Credit has not appealed the
District Court's Judgment and its time to appeal has expired.
Dana Credit has also failed to pay any portion of the Judgment.
By virtue of the Judgment, Mr. Dorchak asserts that Great-West's
right to payment from Dana Credit should be given priority. Dana
Credit should not be permitted to employ the Settlement Agreement
as a means to channel payments to the Settling Noteholders while
bypassing its obligations to Great-West, Mr. Dorchak contends.
Accordingly, Great-West asks the Court to rule that the
Settlement Agreement is without prejudice to its rights and
remedies as judgment creditor against Dana Credit, including any
rights it Great-West may have against the $325,000,000 allowed
claim.
About Dana Corporation
Toledo, Ohio-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). As of
Sept. 30, 2005, the Debtors listed $7,900,000,000 in total assets
and $6,800,000,000 in total debts.
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. Fried,
Frank, Harris, Shriver & Jacobson, LLP serves as counsel to the
Official Committee of Equity Security Holders. Stahl Cowen
Crowley, LLC serves as counsel to the Official Committee of Non-
Union Retirees.
The Debtors' exclusive period to file a plan expires on Jan. 3,
2007. They have until Mar. 5, 2007, to solicit acceptances to
that plan.
(Dana Corporation Bankruptcy News, Issue No. 27; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000).
DELPHI CORP: Status Hearing on 1113/1114 Motion Scheduled Tomorrow
-----------------------------------------------------------------
In light of the progress reported to the U.S. Bankruptcy Court for
the Southern District of New York by Delphi Corporation and its
debtor-affiliates at a status conference held on Nov. 17, 2006,
Judge Robert Drain adjourns the hearing on the 1113/1114 Motion to
a date yet to be determined.
The Court will conduct an in-person, in-camera status conference
with the Debtors, the Respondents, and the Official Committee of
Equity Security Holders at 3:00 p.m. tomorrow, Nov. 30, 2006, so
that the Court can be apprised by the parties of the status of
negotiations regarding the consensual resolution of the 1113/1114
Motion.
Pursuant to Sections 1113(d)(2) and 1114(k)(2) of the Bankruptcy
Code, the date by which a ruling on the 1113/1114 Motion will be
issued is extended, with the consent of the Debtors and the
Respondents to the extent required by statute, to Jan. 31, 2007.
Delphi is seeking to reject its collective bargaining agreements
with unions and to modify obligations to provide insurance
benefits for its hourly retirees. To restructure its U.S.
operations, Delphi is planning to cut 4/5 of its 33,100 U.S.
hourly workers, close 21 of its 29 U.S. union plants and slash
wages and benefits for workers who stay.
The Section 1113-1114 proceedings began May 9, 2006, with opening
statements by Delphi, the UAW, other objecting unions -- IUE-CWA,
USW, IAM, IBEW and IUOE -- the Official Committee of Unsecured
Creditors and others.
About Delphi Corp
Troy, Mich.-based 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. 48; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
DELTA AIR: Meeting with Creditors Panel and US Airways this Week
----------------------------------------------------------------
US Airways Group Inc., Delta Air Lines Inc. and its official
committee of unsecured creditors will meet this week to discuss
U.S. Airways' $8 billion merger offer, CNNMoney.com reports. This
is the first meeting where US Airways speaks directly to Delta
creditors since making its merger offer on Nov. 15.
Daniel Golden, Esq., at Akin, Gump, Strauss, Hauer & Feld LLP,
which represents Delta's creditors committee, told Reuters that
the meeting would allow US Airways to present its $8.6 billion bid
and address expected integration issues.
Citing Mr. Golden, Reuters says the creditors' committee never had
separate discussions with US Airways but is in "constant
discussion" with Delta.
As reported in the Troubled Company Reporter on Nov. 16, 2006,
US Airways has made a merger deal to Delta Air under which both
companies would combine upon Delta's emergence from bankruptcy.
The proposal would provide approximately $8 billion of value in
cash and stock to Delta's unsecured creditors. Delta creditors
would receive $4 billion in cash and 78.5 million shares of US
Airways stock with an aggregate value of approximately $4 billion
based on the closing price of US Airways' stock as of
Nov. 14, 2006.
Headquartered in Atlanta, Georgia, Delta Air Lines
-- http://www.delta.com/-- is the world's second-largest airline
in terms of passengers carried and the leading U.S. carrier across
the Atlantic, offering daily flights to 502 destinations in 88
countries on Delta, Song, Delta Shuttle, the Delta Connection
carriers and its worldwide partners. The Company and 18
affiliates filed for chapter 11 protection on Sept. 14, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner,
Esq., at Davis Polk & Wardwell, represents the Debtors in their
restructuring efforts. Timothy R. Coleman at The Blackstone Group
L.P. provides the Debtors with financial advice. Daniel H.
Golden, Esq., and Lisa G. Beckerman, Esq., at Akin Gump Strauss
Hauer & Feld LLP, provide the Official Committee of Unsecured
Creditors with legal advice. John McKenna, Jr., at Houlihan Lokey
Howard & Zukin Capital and James S. Feltman at Mesirow Financial
Consulting, LLC, serve as the Committee's financial advisors. As
of June 30, 2005, the Company's balance sheet showed $21.5 billion
in assets and $28.5 billion in liabilities.
DURA AUTOMOTIVE: Court Approves $300 Million DIP Financing
----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware approved,
on a final basis, the request of DURA Automotive Systems Inc. and
its debtor affiliates to obtain up to $300,000,000 of debtor-in-
possession financing under Sections 363 and 364 of the Bankruptcy
Code from Goldman Sachs Capital Partners L.P., General Electric
Capital Corporation, and other lender parties.
The Court authorized the Debtors to repay in full in cash all
amounts owing and due under the Prepetition First Priority Credit
Agreement dated as of May 3, 2005, by and among Dura Automotive
Systems Inc. and its subsidiaries, as borrowers and guarantors;
JPMorgan Chase Bank, N.A., as administrative agent; Bank of
America, N.A., as collateral agent; and certain financial
institutions and other entities, as lenders. The Debtors owed
the Prepetition First Priority Lenders the principal of
approximately $106,400,000, exclusive of accrued but unpaid
interest, costs, fees and expenses, plus approximately
$19,500,000 in issued and outstanding letters of credit.
To the extent not resolved, the Court overruled all objections.
Repayment of First Lien Indebtedness
Within one business day after the receipt by the Prepetition
First Priority Agents of notice of entry of the Final DIP Order,
or as soon as practicable, the Prepetition First Priority Agents
will deliver to the Debtors a payoff letter:
(i) setting forth their calculation of all amounts then due
and payable in respect of the Prepetition First Priority
Indebtedness, including the unpaid principal balance of
outstanding loans, the face amounts of outstanding letters
of credit, accrued and unpaid interest, swap breakage
costs and any other reasonable fees, costs or expenses due
and payable pursuant to the terms of the Prepetition First
Priority Financing Documents;
(ii) agreeing to deliver to the Postpetition Agents all
Collateral in their possession, together with any
necessary endorsements immediately upon payment of the
Asserted Payoff Amount; and
(iii) providing customary further assurance provisions with
respect to termination or release of Liens.
The Debtors will use the proceeds of borrowings and letters of
credit available under the Postpetition Credit Agreements to
repay the Asserted Payoff Amount. The Debtors reserve all rights
to seek disgorgement of any amounts paid in excess of the
outstanding principal amount of the Prepetition First Priority
Indebtedness, any accrued but unpaid interest, all swap breakage
costs and any other reasonable fees, costs or expenses due and
payable pursuant to the terms of the Prepetition First Priority
Financing Documents.
Subsequent to the Payment Date, the Debtors will promptly pay or
reimburse the applicable Prepetition First Priority Agents and
Prepetition First Priority Lenders for any and all reasonable
fees, costs, expenses, losses, and damages incurred to the extent
the Prepetition First Priority Credit Agreement expressly entitles
them to the payment, indemnity or reimbursement after termination
of the Prepetition First Priority Credit Agreement.
Superpriority Claims and Liens
The Postpetition Agents and Lenders are granted liens and
superpriority claims in all of the Debtors' assets.
All Postpetition Obligations, subject only to the Carve-Out,
constitute under Section 364(c)(1) of the Bankruptcy Code allowed
superpriority administrative expense claims against each of the
Debtors having priority over all administrative expenses of the
kind specified in the Bankruptcy Code.
The Postpetition Revolving Collateral Agent and Postpetition Tern
Loan Collateral Agent are each granted for the sole benefit of
the Postpetition Secured Parties valid, binding, enforceable,
first priority and perfected Liens in the Collateral, which Liens
are subject only to:
(x) the Carve-Out,
(y) non-avoidable, valid, enforceable, and perfected Liens
that are capitalized leases, purchase money security
interests or mechanics' liens in existence on the date
of bankruptcy filing, and
(z) non-avoidable, valid, enforceable Liens that are
capitalized leases, purchase money security interests or
mechanics' liens in existence on the date of bankruptcy
filing that are perfected subsequent to the Petition Date
as permitted by Section 546(b) of the Bankruptcy Code.
Subject to the Carve-Out, the Postpetition Liens will not be:
(i) subject to any Lien that is avoided and preserved for the
benefit of the Debtors' estates under Section 551 of the
Bankruptcy Code or
(ii) subordinated to or made pari passu with any other Lien
under Section 364(d) of the Bankruptcy Code or otherwise.
Intercreditor Agreement
The ad hoc committee of lenders holding a majority in principal
amount owed by the Debtors under the Prepetition Second Priority
Credit Agreement, dated as of May 3, 2005, as amended, previously
disclosed that it would not consent to the proposed terms of the
DIP Facility, unless the InterCreditor Agreement dated May 3,
2005, was annulled.
The Official Committee of Unsecured Creditors, however, argued
that the ICA remains in effect notwithstanding the refinancing
pursuant to the DIP Facility. The Creditors Committee also
refuted the Second Lien Committee's allegations that the Debtors
do not have any rights under the ICA. To the contrary, the
Creditors Committee pointed out, the Debtors are full-fledged
parties to the agreement, and nothing in the agreement limits in
any way their ability to enforce its terms.
The Debtors also disagreed with the Second Lien Committee's
contentions that "one cannot 'refinance' $124,400,000 with
$300,000,000." Section 8.1 of the ICA provides that a DIP
Facility may refinance existing First Priority Indebtness.
Section 5.2 does not provide for any cap on postpetition
financing.
The Final DIP Order provides that each of the parties reserve all
of their rights in respect of the enforceability, applicability,
and interpretation of the ICA, and nothing in the Order will be
deemed to be a:
(i) finding or adjudication thereof; including, without
limitation, with respect to whether the:
(x) transactions contemplated by the Postpetition
Financing Documents are an extension, replacement,
refinancing or refunding in whole or in part of the
Prepetition First Priority Indebtedness;
(y) occurrence of the Payment Date is also the occurrence
of the First Priority Obligations Payment Date; or
(z) transactions contemplated by the Postpetition
Financing Documents are or will result in a breach of
the Prepetition Intercreditor Agreement; or
(ii) waiver or release by any party of any rights, remedies,
benefits or privileges arising under or in connection with
the ICA.
Challenge Period
The Debtors acknowledge that:
-- their obligations under the Prepetition Credit Agreements
constitute the legal, valid and binding obligation of the
Debtors, enforceable in accordance with their terms;
-- no objection, offset, defense or counterclaim of any kind
or nature to the Prepetition Indebtedness exists; and
-- the Prepetition Indebtness, and any amounts previously
paid to any Prepetition Agents or Lenders are not subject
to avoidance, reduction, disallowance, impairment or
subordination pursuant to the Bankruptcy Code or
applicable non-bankruptcy law.
The Debtors' acknowledgements and agreements are subject to:
(i) the rights of any party-in-interest, other than any
Debtor, to file a complaint pursuant to Rule 7001 of the
Federal Rules of Bankruptcy Procedure or other proper
pleading seeking to invalidate, subordinate or otherwise
challenge the Prepetition Lenders' liens and claims; and
(ii) the rights of any party-in-interest, including any Debtor,
to file a complaint or other proper pleading pursuant to
Bankruptcy Rule 7001 seeking to invalidate, subordinate or
otherwise challenge the Prepetition Second Priority Liens.
The Interim DIP Order provided the Creditors Committee 60 days
from the date it was appointed to investigate and challenge the
Prepetition Lenders' liens and claims. The Committee complained
that the 60-day period is insufficient under any circumstances
and requested 180 days from the date of the entry of the Final
Order to commence actions in respect of the Prepetition Lenders'
claims and liens.
Judge Carey, however, orders that any complaint or other proper
pleading relating to the Prepetition Lenders' liens and claims
must be filed in the Court within the later of:
-- Feb. 5, 2007, or 90 days after appointment of the
Creditors Committee, or
-- any subsequent date that may be agreed to in writing by
the corresponding Prepetition Administrative Agent.
Adequate Protection to Prepetition Lenders
The Second Lien Committee conditioned its consent to the entry of
the Final DIP Order to, among others, the removal of a provision
allowing the Debtors to terminate interest payments after paying
the sixth monthly installment to the Second Lien Lenders.
Representing the Creditors Committee, M. Blake Cleary, Esq., at
Young Conaway Stargatt and Taylor, in Wilmington, Delaware,
argued that the Second Lien Lenders are not entitled to adequate
protection payments pursuant to the ICA. He noted that the ICA
limits the Second Lien Lenders to these adequate protection
provisions:
(i) replacement liens in any additional collateral provided
to the Prepetition First Lien Lenders as adequate
protection, and
(ii) superpriority claims junior in all respects to any
superpriority claims granted to the Prepetition First Lien
Lenders.
The Creditors Committee also pointed out that, under the ICA, the
Second Lien Lenders further agreed not to obtain superpriority
claims in the absence of a stipulation that the claims can be
paid in securities or other property.
Notwithstanding the Creditors Committee's objections, the Court
authorizes the Debtors to grant the Prepetition Agents and the
Prepetition Lenders these forms of adequate protection:
(a) Solely to the extent of any diminution in the value of
their interests in the Prepetition Collateral from and
after the Petition Date, the Prepetition Agents -- for
their benefit and the benefit of the Prepetition Lenders
-- will be entitled to replacement Liens, subject and
junior only to the Postpetition Liens, Existing Liens
and the Carve-Out, on all Collateral other than proceeds
of any avoidance actions under Chapter 5 of the Bankruptcy
Code.
(b) The Prepetition Agents and the Prepetition Lenders will
also be entitled to allowed administrative priority claims
under Section 507(b) of the Bankruptcy Code solely for any
diminution in value of their interests in the Prepetition
Collateral from and after the filing for bankruptcy. The
Adequate Protection Claims will be payable from and have
recourse to all prepetition and postpetition property of
the Debtors and all proceeds other than proceeds of any
avoidance actions under Chapter 5.
(c) Except with respect to default rate interest and swap
breakage costs, subject to Section 506(b), to the extent
relevant, the Debtors will, on a calendar monthly basis
until the Payment Date, promptly pay in cash:
(i) all accrued but unpaid reasonable costs and expenses
of the Prepetition First Priority Agents for which
an invoice was delivered to the Debtors,
(ii) reasonable fees and expenses, for which an invoice
was delivered to the Debtors, of professionals
engaged by any Prepetition First Priority Lender, up
to a maximum aggregate amount of $50,000 for all
the fees and expenses of professionals engaged by
all Prepetition First Priority Lenders, and
(iii) all accrued but unpaid interest on the Prepetition
First Priority Indebtedness at the non-default rate
specified in the Prepetition First Priority Credit
Agreement and all other reasonable fees, expenses,
costs and charges provided under the Prepetition
First Priority Credit Agreement or any other
Prepetition First Priority Financing Document for
which an invoice was delivered to the Debtors, in
each case regardless of whether the amounts accrued
prior to the bankruptcy filing and all without
further motion, fee application or Court order.
(d) Subject to Section 506(b), to the extent relevant, the
Debtors will -- on Nov. 30, 2006 and on the last
calendar date of each month thereafter -- make current
cash payments to the Prepetition Second Priority
Administrative Agent, for the benefit of the Prepetition
Second Priority Lenders, of interest accruing pursuant to
the Prepetition Second Priority Credit Agreement at the
rate equal to:
-- the Eurodollar Rate plus 4.75% per annum; plus
-- the positive difference, if any, between (i) the
weighted average flex in respect of the margins
applicable to borrowings under the Postpetition
Credit Agreements and (ii) 0.675%,
but in no event greater than the Base Rate plus the
Applicable Margin.
The Adequate Protection Liens and Claims of the Prepetition
Second Priority Agents on any Collateral will be subordinate in
priority to the Prepetition First Priority Agents' Liens. The
Adequate Protection Claims in favor of any of the Prepetition
Agents or Prepetition Lenders will be subordinate and junior in
right of payment and otherwise to the payment in full in cash and
satisfaction in the manner provided in the Postpetition Financing
Documents of the Postpetition Obligations and the Carve-Out.
No Prepetition Second Priority Agent or Prepetition Second
Priority lender will be entitled to accrual or payment of any
additional interest that might otherwise accrue at the default
rate under the Prepetition Second Priority Credit Agreement
during any period for which the Debtors make the monthly cash
payments. The Prepetition Second Priority Agents or Prepetition
Second Priority Lenders, however, reserve their rights to assert
that interest has continued to accrue under the Prepetition
Second Priority Credit Agreement from the Petition Date at the
Base Rate plus the Applicable Margin.
If the Payment Date has not occurred by Nov. 30, 2006, all
interest payments otherwise due on Nov. 30, 2006, will be paid
on Dec. 29, 2006.
After making the monthly interest payment due on April 30, 2007,
the Debtors may, on no less than 20 days' notice, seek entry of a
Court order permitting them to discontinue making any or all of
the monthly interest payments.
If the Debtors make each monthly interest payment through and
including the payment due on Oct. 31, 2007, no Prepetition
Second Priority Agent or Prepetition Second Priority Lender will
have the right to any prepayment fee that might otherwise be or
become due or arise under the Prepetition Second Priority Credit
Agreement.
Subject to Section 506(b), to the extent relevant, within 10 days
of the rendering of any invoice, the Debtors will reimburse the
Second Lien Committee and Prepetition Second Priority Agents, as
applicable, for the reasonable fees and expenses of:
(i) lead counsel and reasonably necessary local counsel to
the Second Lien Committee,
(ii) the Prepetition Second Priority Administrative Agent, and
(iii) the Prepetition Second Priority Collateral Agent.
Additionally, subject to Section 506(b), on a monthly basis and
within 10 days of the rendering of an invoice, the Debtors will
reimburse the Second Lien Committee for reasonable monthly fees
and expenses incurred in connection with the retention by the
Second Lien Committee of Lazard Freres & Co. LLC, as financial
advisor, up to a maximum amount of $150,000 per month plus
reasonable expenses and standard form indemnity consistent with
the United States Trustee's guidelines and the customary practice
in the Court.
After making all payments for fees and expenses incurred through
April 2007, the Debtors may, on no less than 20 days' notice, seek
entry of an order by the Court permitting them to discontinue
making any or all payments. The Debtors will not pay for the
fees and disbursements and the Prepetition Second Priority Agents
and Prepetition Second Priority Lenders will not accept, any
payments prior to the Payment Date.
In the event that it is determined by a final, non-appealable
order that any of the Prepetition Agents and Prepetition Lenders
were not entitled to receive any adequate protection payments, or
that any payments received could not be applied to postpetition
interest, fees and expenses, any of the payments may, upon
appropriate notice, hearing and order, be recharacterized as
payment of principal or subject to other relief as the Court may
order.
Creditors Panel's Concerns
The Creditors Committee requested that, in addition to the
$10,000,000 of professional fees, the Carve-Out should include
the reimbursement of expenses of Committee members.
The Creditors Committee also opposed to granting the DIP Lenders
a lien on any of the Debtors' avoidance actions.
The Final DIP Order provides that the Carve-Out includes unpaid
and allowed actual and necessary out of pocket expenses of
members of the Creditors Committee or any Committee incurred in
the performance of duties of the Committee, as applicable.
The Final DIP Order, however, provides that the Debtors' DIP
Obligations will be payable from and have recourse to all
prepetition and postpetition property and assets of the Debtors
and all proceeds, including, without limitation, the proceeds of
any avoidance actions under Chapter 5.
The Court directed the Debtors to deliver to the Committee or its
counsel:
-- invoices relating to the payment of any fees and expenses
of the DIP Lenders the Prepetition Lenders or other
persons; and
-- copies of all budgets, financial information, notices,
reports and other documents or information delivered to
any of the DIP Lenders or the Prepetition Lenders.
The Court also directed the Debtors to send the Committee notices
of any:
(i) increase in the aggregate of the Postpetition Lenders'
lending commitments,
(ii) increase in the applicable interest rates, other than
increases specified in the Debtors' DIP Financing request,
(iii) modification of the maturity of the obligations under the
Postpetition Financing Documents, or
(iv) modification of the financial covenants or financial
events of default that are on terns materially more
onerous or burdensome to the Debtors.
Rochester Hills, Mich.-based DURA Automotive Systems Inc.
(Nasdaq: DRRA) -- http://www.DURAauto.com/-- is an independent
designer and manufacturer of driver control systems, seating
control systems, glass systems, engineered assemblies, structural
door modules and exterior trim systems for the global automotive
industry. The company is also a supplier of similar products to
the recreation vehicle and specialty vehicle industries. DURA
sells its automotive products to North American, Japanese and
European original equipment manufacturers and other automotive
suppliers.
The Debtors filed for chapter 11 petition on October 30, 2006
(Bankr. District of Delaware Case No. 06-11202). Richard M.
Cieri, Esq., Marc Kieselstein, Esq., Roger James Higgins, Esq.,
and Ryan Blaine Bennett, Esq., of Kirkland & Ellis LLP are lead
counsel for the Debtors' bankruptcy proceedings. Mark D. Collins,
Esq., Daniel J. DeFranseschi, Esq., and Jason M. Madron, Esq., of
Richards Layton & Finger, P.A. Attorneys are the Debtors'
co-counsel. Baker & McKenzie acts as the Debtors' special
counsel. Togut, Segal & Segal LLP is the Debtors' conflicts
counsel. Miller Buckfire & Co., LLC is the Debtors' investment
banker. Glass & Associates Inc., gives financial advice to the
Debtor. Kurtzman Carson Consultants LLC handles the notice,
claims and balloting for the Debtors and Brunswick Group LLC acts
as their Corporate Communications Consultants for the Debtors. As
of July 2, 2006, the Debtor had $1,993,178,000 in total assets and
$1,730,758,000 in total liabilities. (Dura Automotive Bankruptcy
News, Issue No. 6; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
DURA AUTOMOTIVE: Gets Court's Final Nod To Use Cash Collateral
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware granted, on
a final basis, DURA Automotive Systems Inc. and its debtor-
affiliates' use of their prepetition lenders' cash collateral
until the occurrence of a termination event, which:
(a) prior to the repayment in full in cash of the Debtors'
obligations under the First Lien Revolver, will mean the
earliest to occur of:
(i) Dec. 20, 2006;
(ii) acceleration of the Debtors' direct borrowings and
reimbursement obligations under the $300,000,000
DIP Financing agreements with Goldman Sachs Capital
Partners L.P., General Electric Capital Corp. and
other lender parties;
(iii) the Interim DIP Order or the Final DIP order ceases
to be in full force and effect; or
(iv) the Debtors receive authorization from the Court to
borrow prior to entry of the Final DIP Order more
than the principal amount of $50,000,000 under the
DIP Financing Documents; and
(b) subsequent to the repayment of the Debtors' obligations
under the First Lien Revolver:
(1) the acceleration of the Postpetition Obligations;
(2) the Interim DIP Order or the Final DIP Order ceases
to be in full force and effect; or
(3) the Postpetition Lenders' commitments are increased
in a manner that the aggregate amount of the
commitments exceeds the $300,000,000 principal
amount.
The Official Committee of Unsecured Creditors agrees that the cash
collateral of the Prepetition First Lien Lenders may not be used
to object to or contest their liens and claims.
However, according to the Committee, there is no reason to allow
the Second Lien Lenders to preclude the use of cash collateral to
fund an investigation into the serious questions concerning the
validity of their liens, especially since they have explicitly
consented in the Intercreditor Agreement dated May 3, 2005, to the
use of their cash collateral without any reservation whatsoever.
The Court rules that no cash collateral of the Prepetition Second
Lien Lenders may be used directly or indirectly by any of the
Debtors, the Creditors Committee, any Committee or any other
person or entity to object to or contest in any manner the
Prepetition Second Lien Lenders' liens and claims, or to assert or
prosecute any actions, claims or causes of action against any of
the Prepetition Second Lien Agents or Lenders without their
consent.
Rochester Hills, Mich.-based DURA Automotive Systems, Inc.
(Nasdaq: DRRA) -- http://www.DURAauto.com/-- is an independent
designer and manufacturer of driver control systems, seating
control systems, glass systems, engineered assemblies, structural
door modules and exterior trim systems for the global automotive
industry. The company is also a supplier of similar products to
the recreation vehicle and specialty vehicle industries. DURA
sells its automotive products to North American, Japanese and
European original equipment manufacturers and other automotive
suppliers.
The Debtors filed for chapter 11 petition on October 30, 2006
(Bankr. District of Delaware Case No. 06-11202). Richard M.
Cieri, Esq., Marc Kieselstein, Esq., Roger James Higgins, Esq.,
and Ryan Blaine Bennett, Esq., of Kirkland & Ellis LLP are lead
counsel for the Debtors' bankruptcy proceedings. Mark D. Collins,
Esq., Daniel J. DeFranseschi, Esq., and Jason M. Madron, Esq., of
Richards Layton & Finger, P.A. Attorneys are the Debtors'
co-counsel. Baker & McKenzie acts as the Debtors' special
counsel. Togut, Segal & Segal LLP is the Debtors' conflicts
counsel. Miller Buckfire & Co., LLC is the Debtors' investment
banker. Glass & Associates Inc., gives financial advice to the
Debtor. Kurtzman Carson Consultants LLC handles the notice,
claims and balloting for the Debtors and Brunswick Group LLC acts
as their Corporate Communications Consultants for the Debtors. As
of July 2, 2006, the Debtor had $1,993,178,000 in total assets and
$1,730,758,000 in total liabilities. (Dura Automotive Bankruptcy
News, Issue No. 6; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
EASTON-BELL: Moody's Pares Corporate Family Rating to B2 from B1
----------------------------------------------------------------
Moody's Investors Service downgraded Easton-Bell Sports Inc.'s
corporate family rating to B2 from B1. Moody's also affirmed the
Ba3 rating on the company's senior secured credit facilities and
the B3 rating on its senior subordinated notes.
The speculative grade liquidity rating was affirmed at SGL-2.
The downgrade of the corporate family rating was prompted by the
company's announcement that it issued $175 million of senior
unsecured PIK loans due 2012 at EB Sports Corp., an indirect
parent of Easton-Bell.
The notes are floating rate, PIK for life, include an IPO equity
clawback, and do not benefit from any guarantees. EB Sports Corp.
used the net proceeds to pay a dividend to its parent company,
Easton-Bell Sports, LLC, which is expected to use the proceeds to
make a distribution to its equity holders.
The downgrade reflects Moody's view that the additional
$175 million of debt associated with the PIK loans results in
consolidated credit metrics that are inconsistent with a
B1 ratings profile.
Moody's estimates that the company's pro forma consolidated debt
to EBITDA increases to 6.2x while pro forma operating company
leverage remains unchanged at 4.6x for the LTM ended Sept. 30,
2006.
The outlook remains stable.
These ratings were downgraded:
* Easton-Bell Sports, Inc.
-- Corporate family rating, to B2 from B1;
-- Probability-of-default rating, to B2 from B1.
These ratings were affirmed:
* Easton-Bell Sports, Inc.
-- $140 million 8.375% senior subordinated notes due 2012,
B3, LGD5, 73%;
-- $70 million senior secured revolving credit facility due
2012, Ba3, LGD2, 26%;
-- $333 million senior secured term loan B due 2012, Ba3,
LGD2, 26%;
* Easton Sports Canada, Inc.
-- CDN$12 million senior secured revolving credit facility
due 2012, Ba3, LGD2, 26%.
Easton-Bell's B2 corporate family rating is primarily driven by a
weak quantitative profile with pro forma consolidated credit
metrics largely consistent with mid to low B rated companies and
longer-term acquisition risk as the company seeks to expand within
the fragmented sports equipment market.
The rating also recognizes the company's participation within low-
growth product categories, continued product liability risks, and
susceptibility to discretionary spending trends.
Notwithstanding these risks, the rating is also driven by Easton-
Bell's strong qualitative profile with a portfolio of well-known
proprietary brand names, stable and leading market positions in
multiple product categories, diverse customer channels with
limited exposure to mass merchandisers, relatively modest capital
expenditure requirements, favorable operating margins in the low-
teens, and the opportunity to realize cost savings through the
integration of Easton Sports.
The stable outlook reflects Moody's expectation that the company
will continue to expand EBITDA levels through innovative product
introductions and to a lesser extent cross-selling product through
channels, resulting in a consolidated debt to EBITDA below 6x and
a free cash flow to consolidated debt in the low to mid-single
digits for FY 2007.
Headquartered in Van Nuys, California, Easton-Bell Sports, Inc.
was formed through Riddell Bell's acquisition of Easton Sports in
March 2006. The company is a designer, developer and marketer of
branded equipment that enhances athletic performance and
protection and related accessories for numerous athletic and
recreational activities. The company reported actual revenues of
$582 million for the LTM ended Sept. 30, 2006.
ELECTRIC AQUAGENICS: Sept. 30 Balance Sheet Upside Down by $2.9MM
-----------------------------------------------------------------
Electric Aquagenics Unlimited Inc.'s balance sheet at Sept. 30,
2006, showed $5,564,734 in total assets, $8,470,534 in total
liabilities, and $2,905,800 in stockholders' deficit, as compared
to total assets of $5,809,927, total liabilities of $8,546,598,
and stockholders' deficit of $2,736,671 at Dec. 31, 2005.
The company reported a $1,351,852 net loss on $778,737 of revenues
for the quarterly period ended Sept. 30, 2006, as against a net
loss of $4,218,100 on $278,767 of total revenues for the same
period in 2005. Revenues for this quarter represent an increase
of 179% in total revenues for the same period one year earlier. A
majority of this increase came from consumer products sales of
approximately $297,000 and EO Machine sales of approximately
$440,000 in the current three month period versus approximately
$313,000 consumer product sales and $0 EO Machine sales in the
three months ended Sept. 30, 2005.
The majority of the decrease in net loss over the comparable
period in 2005 was due to the recording of the derivative
liability loss at Sept. 30, 2005 of $2,385,194, compared to a gain
in the fair market value of the derivative liability of $29,792 at
Sept. 30, 2006. The current quarter net loss includes an increase
of $217,296 in interest expense, from $65,653 in 2005 to $282,909
in 2006, or an increase of 331%. This is due to interest expense
related to the senior note payable entered into in September 2005.
The company had $226,367 in cash as of Sept. 30, 2006, compared to
$681,348 at Dec. 31, 2005. Their working capital as of Sept. 30,
2006 was $1,353,717 compared to $1,089,192 at Dec. 31, 2005. The
primary reason for the increase in their working capital for the
nine months ended Sept. 30, 2006, was a decrease in cash of
$454,981, or 66%, which was offset by an increase in accounts
receivable of $453,373, or 367%, and from an increase in inventory
of $411,936, or 21%.
Full-text copies of the company's financial statements for the
quarterly period ended Sept. 30, 2006, are available for free at
http://researcharchives.com/t/s?15c1
Going Concern Doubt
HJ & Associates, LLC, in Salt Lake City, Utah, raised substantial
doubt about Electric Aquagenics Unlimited, 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. The company also had a high level of equity financing
transactions at Dec. 31, 2005.
About Electric Aquagenics
Based in Lindon, Utah, Electric Aquagenics Unlimited, Inc., aka
EAU Technologies, Inc. -- http://www.eau-x.com/-- develops,
manufactures, and markets purification equipment using
technologies that sanitize and clean surfaces using water
electrolysis. Its equipment uses water electrolysis to create
fluids to be used in various industries for cleaning,
disinfecting, remediation, hydrating, and moisturizing.
ENRON CORP: Court Approves Mediation of State Law Claims
--------------------------------------------------------
The Honorable Arthur Gonzalez of the U.S. Bankruptcy Court for the
Southern District of New York has ordered Enron Corp., its debtor-
affiliates, the Official Committee of Unsecured Creditors, the
Litigation Trust and Special Litigation Trust, and Andrews Kurth
LLP, to mediate the parties' state law claims dispute.
Specifically, Judge Gonzalez ruled that:
(1) Andrews Kurth LLP and Enron Corp. will mediate their
dispute with the Honorable James M. Peck of the U.S.
Bankruptcy Court for the Southern District of New York as
the mediator;
(2) Judge Peck will have the duty and authority to establish
the times and places for mediation activities and for the
submission of relevant documents, and no documents in the
mediation other than Judge Peck's final report will be
filed with the Court;
(2) party representatives, including a member of the
Reorganized Debtors and Andrews Kurth, and all other
persons with necessary authority to negotiate a
settlement, must attend the mediation;
(3) the results of the mediation are non-binding unless the
parties agree otherwise;
(4) all communications made during the mediation are
confidential, are protected from disclosure, and do not
constitute a waiver of any existing privileges and
immunities; and
(5) if necessary, Andrews Kurth and Enron will extend their
current tolling deadline of Dec. 1, 2006, until a
reasonable time after the completion of the mediation.
The state law claims dispute relates to a Dec. 1, 2003 Court order
authorizing the Creditors Committee to commence and pursue certain
enumerated state law claims against Andrews Kurth.
The Creditors Committee had filed suit against other defendants
in Montgomery County, Texas. That case was subsequently removed
to the U.S. District Court for the Southern District of Texas,
where it remains as a "coordinated" case with other Enron-related
litigation before the Honorable Melinda Harmon.
The Enron Entities have not yet sued Andrews Kurth.
Committee Sues Andrews Kurth
Soon after, the Creditors Committee moved for Court authorization
to sue Andrews Kurth. The Committee subsequently entered into a
stipulation with Andrews Kurth, with the Court's permission, to
toll applicable statutes of limitation with respect to any claims
against Andrews Kurth, on Nov. 25, 2003. The stated reasons for
the stipulation were (a) "to avoid the cost and expense of
unnecessary motion practice and litigation," and (b) "to provide
additional time to discuss the possible resolution of potential
claims."
Much has happened since that initial stipulation to toll
limitations, Autumn Hwang, Esq., at Fish & Richardson P.C., in New
York, relates. She cites:
-- The Creditors Committee prosecuted and settled numerous
avoidance, preference, and other claims on behalf of Enron
against numerous parties other than Andrews Kurth, many
without filing suit against the opposing party.
-- Andrews Kurth wound up its postpetition representation of
Enron, amicably resolved, after mediation, the preference
claim asserted against it, and received the Court's
approval, with only minor objections, of its fees and
expenses associated with its postpetition work for the
Debtors.
-- Pursuant to Judge Harmon's orders, fact discovery
proceeded to conclusion in all pending Enron-related
litigation, including extensive document production from
Andrews Kurth and depositions of numerous Andrews Kurth
witnesses. Counsel for the Creditors Committee
participated in the depositions and have access to the
discovery.
-- Andrews Kurth and the Creditors Committee have agreed to 17
extensions of the original tolling stipulation, with the
latest extension to Oct. 3, 2006. Enron and the Committee
have filed a notice with the Court indicating their
agreement to extend until Dec. 31, 2006 the deadline by
which the Litigation Trust and the Special Litigation Trust
must be created.
-- Andrews Kurth and the Creditors Committee have engaged in
lengthy settlement negotiations.
Andrews Kurth believes that the use of a neutral party is key to
the resolution of the disputes since both sides have the
opportunity to discuss the strengths of their case before an
impartial neutral party. Furthermore, recommendations by the
neutral party may be brought to Andrews Kurth's and the
Committee's constituencies for appropriate deliberation.
Ms. Hwang notes that there are risks to the Enron Entities in
bringing suit against Andrews Kurth. The state law claims that
the Enron Entities would bring against Andrews Kurth raise many
problematic issues for them. Aside from the typical issues in
legal malpractice cases, the Enron Entities will be faced with
Andrews Kurth's defensive argument that the illegal conduct of
Enron's management bars any recovery on behalf of Enron under the
in pari delicto doctrine. The Enron Entities face a substantial
risk that it will recover nothing from its claim against Andrews
Kurth.
This is not a circumstance where additional information is
required before the claims can be evaluated, Ms. Hwang asserts.
She notes that Andrews Kurth's representation of Enron in the FAS
125/140 transactions has been dissected in great detail by the
Court-appointed Examiner. All of Andrews Kurth's lawyers directly
involved in these transactions have provided hours of additional
testimony in the coordinated discovery process managed by Judge
Harmon.
No real harm will be suffered by either side if filing of suit is
postponed until mediation can be held, Ms. Hwang maintains. The
original tolling stipulation has been extended 16 times for a
period of almost three years. Andrews Kurth is willing to extend
the stipulation regarding tolling of limitations for a short
period beyond the mediation. The potential benefit that a
settlement would bring far outweighs the relatively small time and
expense that would be incurred in attending the mediation.
Enron Responds
Michael V. Marconi, Esq, at McKool Smith, P.C., in Dallas, Texas,
notes that Enron and the Creditors Committee have engaged in
extensive settlement discussions with Andrews Kurth, but have
been unable to reach agreement.
Accordingly, Enron does not believe that mediation at this time
would be productive. However, Enron has extended the tolling
agreement for one week until October 10 to allow the Court to
consider Andrews Kurth's motion.
About Enron Corp.
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.
Albert Togut, Esq., at Togut Segal & Segal LLP, Brian S. Rosen,
Esq., Martin Soslan, Esq., Melanie Gray, Esq., Michael P. Kessler,
Esq., Sylvia Ann Mayer, Esq., at Weil, Gotshal & Manges LLP,
Frederick W.H. Carter, Esq., Michael Schatzow, Esq., Robert L.
Wilkins, Esq., at Venable, Baetjer and Howard, LLP, and Mark C.
Ellenberg, Esq., at Cadwalader, Wickersham & Taft, LLP represent
the Debtor. Jeffrey K. Milton, Esq., Luc A. Despins, Esq.,
Matthew Scott Barr, Esq., and Paul D. Malek, Esq., at Milbank,
Tweed, Hadley & McCloy LLP represents the Official Committee of
Unsecured Creditors. (Enron Bankruptcy News, Issue No. 182;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
ENTERGY NEW ORLEANS: Disclosure Statement Hearing on January 25
---------------------------------------------------------------
The Hon. Jerry A. Brown of the U.S. Bankruptcy Court for the
Eastern District of Louisiana will convene a hearing to consider
approval of the disclosure statement explaining Entergy New
Orleans Inc.'s First Amended Plan of Reorganization on Jan. 25,
2007, at 10:00 a.m.
Counsel for the Debtor and Financial Guaranty Insurance Company
represented to the Court at a hearing on Nov. 15, 2006, that
they are negotiating toward -- and have a substantial chance of
success of agreeing on -- a consensual plan of reorganization,
but that additional time is necessary to reduce any agreements to
writing. The parties asked the Court to continue the Disclosure
Statement in January.
Judge Brown says approval of any other disclosure statements filed
before that time will be taken up at the January 25 hearing.
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. 28; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
ENTERGY NEW ORLEANS: NRG Power Quits From Creditors Committee
-------------------------------------------------------------
NRG Power Marketing Inc., represented by Jeffrey M. Baudier, has
resigned from the Official Committee of Unsecured Creditors in
Entergy New Orleans Inc.'s Chapter 11 case.
R. Michael Bolen, the U.S. Trustee for Region 5, has not yet
appointed any replacement for NRG Power in the Committee.
The Committee is now comprised of:
(1) Apache Corporation
Attn: Roxanne Armstrong
2000 Post Oak Blvd.
Houston, Texas 77056-4400
Tel: (713) 296-6501
Fax: (713) 296-6501
(2) Western Gas Resources, Inc.
Attn: Brian Jeffries
1099 - 18th Street, Suite 1200
Denver, Colorado 80202
Tel: (303) 452-5603
Fax: (303) 457-9748
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. 28; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
EVANS INDUSTRIES: Wants to Hire Jones Walker as Special Counsel
---------------------------------------------------------------
Evans Industries Inc. asks the U.S. Bankruptcy Court for the
Eastern District of Louisiana for authority to employ Jones Walker
Waechter Poitevent Carrere & Denegre as its special counsel.
Jones Walker is expected to:
1) advise the Debtor regarding environmental liability; and
2) prepare an opinion letter regarding environmental
liability.
Michael Chernekoff, Esq., a partner at Jones Walker, tells the
Court that the Firm's professionals bill:
Professional Designation Hourly Rate
------------ ----------- -----------
Michael Chernekoff, Esq. Counsel $320
Stan Millan, Esq. Counsel $250
Tara Richard, Esq. Counsel $220
Paralegal $125
Mr. Chernekoff assures the Court that the Firm is "disinterested"
as that term is defined in Section 101(14) of the Bankruptcy Code.
Mr. Chernekoff can be contacted at:
Michael A. Chernekoff, Esq.
Jones, Walker, Waechter, Poitevent, CarrSre & DenSgre, LLP
201 St. Charles Avenue
New Orleans, Louisiana 70170-5100
Tel: (504) 582-8000
Fax: (504) 582-8583
http://www.joneswalker.com
Headquartered in Harvey, Louisiana, Evans Industries, Inc. --
http://www.evansindustriesinc.com/-- manufactures and distributes
steel drums. The company filed for chapter 11 protection on April
25, 2006 (Bankr. E.D. La. Case No. 06-10370). Eric J. Derbes,
Esq., and Melanie M. Mulcahy, Esq., at The Derbes Law Firm, LLC,
represent the Debtor. C. Davin Boldissar, Esq., at Locke Liddell
& Sapp, LLP, represents the Official Committee of Unsecured
Creditors. When the Debtor filed for protection from its
creditors, it estimated assets between $500,000 and $1 million and
debts between $10 million and $50 million.
FEDERAL-MOGUL: Mesothelioma Claimants Object to $500MM Settlement
-----------------------------------------------------------------
Certain individuals asserting personal injury claims for exposure
either to asbestos-containing products produced by Federal-Mogul
Corporation, its debtor affiliates and Pneumo Abex LLC, ask the
U.S. Bankruptcy Court for the District of Delaware to deny the
$500,000,000 alternative settlement among the Debtors; the
Asbestos Claimants Committee; Eric D. Green, the current legal
representative of futures asbestos claimants; and the Pneumo
Parties.
The Mesothelioma Claimants, represented by SimmonsCooper LLC, are
defendants in a complaint for declaratory and injunctive relief
under Sections 362 and 105 of the Bankruptcy Code filed by the
Debtors, the Asbestos Committee, and the FCR, styled Federal-Mogul
Corp., et al. v. Bobby Whitley, et al.
On the Mesothelioma Claimants' behalf, Patricia P. McGonigle,
Esq., at Seitz, Van Ogtrop & Green, P.A., in Wilmington, Delaware,
tells the Honorable Judith K. Fitzgerald of the U.S. Bankruptcy
Court for the District of Delaware that the Settling Parties'
request lacks adequate information to constitute fair notice of
the terms of the Plan B Settlement. She notes that nowhere in any
of the Motion, the Plan B Settlement, or a Second Term Sheet does
it state where the money is coming from to pay Cooper Industries,
LLC, Cooper Industries, Ltd., and Pneumo Abex. Thus, she says, no
asbestos creditor can possibly evaluate whether or not to object
to the Plan B Settlement without that additional information.
Ms. McGonigle argues that the Motion and the underlying Plan B
Settlement improperly divide and seek separate approval for what
is clearly a unified settlement under the aegis of the Second Term
Sheet. While the amount of the Pneumo Protected Parties' allowed
claims may be liquidated by the Plan B Settlement terms, not all
of the binding terms concerning the Settlement's implementation
are contained therein. Rather, she states, the Second Term Sheet
contains numerous provisions that directly impact whether and when
the Plan B Settlement will take effect, and certainly provides
that the eventual fourth amended plan will control over the Plan B
Settlement.
"For this reason, the Court cannot separately approve the Plan B
Settlement Agreement without also taking under advisement whether
to approve the Second Term Sheet as a whole, or indeed waiting
until all of these terms are incorporated into the eventual fourth
amended plan of reorganization," Ms. McGonigle points out.
Furthermore, the Mesothelioma Claimants complain that the
interests of current and future PI claimants against Pneumo Abex
are not adequately represented by the FCR.
Ms. McGonigle contends that the FCR has an inescapable and
incurable conflict of interest in his simultaneous representation
of the Abex Claimants, on one hand, and the remaining future
asbestos creditors of the Debtors, on the other. She avers that
the FCR, instead, has been forced to make a decision either:
(i) to take money directly from the trusts for certain
asbestos creditors of the Debtors to give to the Pneumo
Protected Parties, and, hence allow the Abex Claims to
remain in the tort system; or
(ii) not to take money from the trusts for the Debtors'
asbestos creditors by choosing to send the Abex Claims to
a trust.
The Mesothelioma Claimants maintain that the Motion does not
proffer a sufficient evidentiary basis to conclude that the Plan B
Settlement is indeed a reasonable compromise of the Cooper
Industries and Pneumo Abex claims, in that it appears that the two
claimants will be receiving a far greater recovery on their claims
than that enjoyed by other creditors of the Debtors.
The Mesothelioma Claimants insist that the Court should, in the
alternative, refuse to consider whether to approve the Plan B
Settlement until the time as adequate information concerning the
Settlement is disclosed.
Headquartered in Southfield, Michigan, Federal-Mogul Corporation
-- http://www.federal-mogul.com/-- is an automotive parts company
with worldwide revenue of some $6 billion. The Company filed for
chapter 11 protection on Oct. 1, 2001 (Bankr. Del. Case No.
01-10582). Lawrence J. Nyhan Esq., James F. Conlan Esq., and
Kevin T. Lantry Esq., at Sidley Austin Brown & Wood, and Laura
Davis Jones Esq., at Pachulski, Stang, Ziehl, Young, Jones &
Weintraub, P.C., represent the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they listed $10.15 billion in assets and $8.86 billion
in liabilities. Federal-Mogul Corp.'s U.K. affiliate, Turner &
Newall, is based at Dudley Hill, Bradford. Peter D. Wolfson, Esq.,
at Sonnenschein Nath & Rosenthal; and Charlene D. Davis, Esq.,
Ashley B. Stitzer, Esq., and Eric M. Sutty, Esq., at The Bayard
Firm represent the Official Committee of Unsecured Creditors.
(Federal-Mogul Bankruptcy News, Issue No. 115; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000).
FLINTKOTE CO: Court Extends Lease Decision Period to December 28
----------------------------------------------------------------
The Honorable Judith K. Fitzgerald of the U.S. Bankruptcy Court
for the District of Delaware extended, until Dec. 28, 2006, the
period within which The Flintkote Company and Flintkote Mines Ltd.
can assume, assume and assign, or reject the lease agreement for
their headquarters located at Three Embarcadero Center, Suite
1190, in San Francisco, California.
The Debtors told the Court that the Headquarters Lease expires on
Aug. 31, 2007. At this stage, the Debtors said, they are not
prepared to assume the Lease and obligate its estate for the two
remaining years on the Lease term. Alternatively, if Flintkote is
forced to reject the Lease, it would be required to relocate to
another location thus incurring further expenses and temporarily
disrupting the continuity of the Debtors' business operations.
Flintkote says it is current on its obligations under the Lease.
Flintkote intends to fulfill all future Lease obligations on a
timely basis throughout the duration of the Chapter 11 case,
unless and until the Lease is rejected.
Headquartered in San Francisco, California, The Flintkote Company
is engaged in the business of manufacturing, processing and
distributing building materials. The Company and its affiliate,
Flintkote Mines Limited, filed for chapter 11 protection on
April 30, 2004 (Bankr. D. Del. Case No. 04-11300). James E.
O'Neill, Esq., Laura Davis Jones, Esq., and Sandra G. McLamb,
Esq., at Pachulski, Stang, Ziehl, Young, Jones & Weintraub P.C.,
represent the Debtors in their restructuring efforts. The
Bankruptcy Court appointed James J. McMonagle as the Legal
Representative for Future Asbestos Personal Injury Claimants for
Flintkote and Mines on Aug. 26, 2004, and Sept. 9, 2004,
respectively. When the Debtors filed for protection from their
creditors, they estimated assets and debts of more than
$100 million.
FORD MOTOR: $18BB New Financing Cues Fitch's 'B/RR4' Debt Rating
----------------------------------------------------------------
Fitch Ratings has downgraded Ford Motor Company's senior unsecured
debt to 'B/RR4' from 'B+/RR3' after the disclosure that Ford
intends to raise $18 billion in new financing.
The downgrade is based on the expected subordination of unsecured
debtholders, as the financing includes approximately $15 billion
in secured bank facilities. The components include a $7 billion
term loan and an $8 billion revolving credit facility.
Total secured facilities of $15 billion would compare to total
unsecured automotive debt of approximately $18 billion at
Sept. 30, 2006. Ford's Issuer Default Rating remains at 'B'. The
ratings of Ford Motor Credit are unaffected.
The Rating Outlook is Negative.
Fitch's analysis indicates that unsecured debtholders would be
expected to recovery approximately 34% in the event of default,
placing Ford's unsecured debt at the low end of the RR4 category.
The recovery value for unsecured debtholders incorporates a
significant restructuring of Ford's North American manufacturing
operations in a bankruptcy scenario, value from Ford's 100%
ownership in Ford Credit and certain international holdings, with
minimal value ascribed to Ford's PAG holdings.
Significant non-debt liabilities were also factored into the
recovery rating. With the recovery rating at the low end of the
'RR4' range, any changes to Fitch's assumptions or Ford's
liability structure could result in a review of the unsecured
rating for further downgrade. It is also expected that as Ford
Credit's balance sheet continues to shrink, the value of Ford
Credit equity to Ford unsecured holders will also diminish, and
Fitch will update the recovery ratings as necessary.
The transactions are expected to raise $10 billion in funded debt,
plus further availability of $8 billion under the revolving credit
facility. Coupled with Ford's projected cash portfolio of
approximately $20 billion at year-end 2006, the new financings are
expected to allay liquidity concerns during 2007 despite very
heavy cash outflows.
Annual negative cash flows are expected by Fitch to exceed
$8 billion in 2006 and 2007, due to operating losses,
restructuring costs and working capital outflows.
Despite some progress in Ford's passenger car segment, revenues
are projected to remain under severe pressure in 2007 as a result
of slowing economic conditions, production cutbacks, continued
share loss, and competitive and economic pressures in the critical
pickup category. Progress on the cost side will be insufficient
to offset revenue pressures in 2007 given the extended timetable
for cost-reduction actions to be realized, high commodity costs,
and the severe stresses in the supply base. Recent efforts to
reduce costs will still leave Ford with a high fixed cost
structure, and the bulk of capacity reductions will not be
completed until 2008. The Sept. 2007 UAW contract re-opening will
be a critical component of Ford's ability to achieve a competitive
cost structure, and the possibility of labor actions cannot be
ruled out.
Fitch expects to assign a rating of BB to the new secured
facilities, given expected overcollateralization and full recovery
under Fitch's recovery analysis. The facilities are expected to
be secured by first-priority liens on Ford's principal domestic
manufacturing facilities, substantially all of the Company's U.S.
automotive assets, all or a portion of the stock of certain
subsidiaries including Ford Motor Credit Company, and inter-
company notes.
Fitch's recovery analysis is based on a going-concern basis of a
restructured Ford, and Ford's U.S. assets would be expected to
have very limited value under an alternate-use scenario.
Fitch downgrades these ratings with a Negative Rating Outlook:
* Ford Motor Co.
-- Senior unsecured debt to 'B' from 'B+'.
* Ford Holdings, Inc.
-- Senior unsecured debt to 'B' from 'B+'.
* Ford Motor Co. of Australia
-- Senior unsecured debt to 'B' from 'B+'.
FORD MOTOR: S&P Junks Senior Unsecured Debt Issue Ratings
---------------------------------------------------------
Standard & Poor's Ratings Services lowered its senior unsecured
debt issue ratings on Ford Motor Co. to 'CCC+' from 'B' and
removed the ratings from CreditWatch with negative implications,
where they were placed on Oct. 23.
At the same time, Standard & Poor's affirmed the 'B' corporate
credit rating and all other ratings on Ford, Ford Motor Credit
Co., and related entities.
"The downgrade of the unsecured issues reflects the significant
disadvantage to Ford's unsecured creditors by the planned
introduction of $15 billion of secured debt into the capital
structure," said Standard & Poor's credit analyst Robert Schulz.
"We estimate that the disadvantage to the unsecured debtholders is
reflected by priority claims to adjusted assets in the high 20%
area, but also by the fact that virtually all of the company's
assets will be encumbered," he continued.
In addition, Standard & Poor's believe that in the event of a
default, there could be other parties with substantial claims that
would be considered pari passu with the unsecured creditors,
thereby diluting any eventual recovery for the unsecured
debtholders.
Ford reported on Nov. 27 that it will seek to raise secured
financing consisting of an $8 billion revolving credit facility
and a $7 billion term loan that will be secured by virtually all
of the company's assets.
Standard & Poor's plans to assign ratings to the proposed
financing once further details are disclosed. The financing is
necessary to fund prospective cash operating losses and
restructuring plans while preserving cash and short-term VEBA
trust balances near current levels of about $20 billion.
Separately, Standard & Poor's previously indicated that the
ratings on Ford and related entities were not immediately affected
by the company's report that it needed to restate results dating
back to 2001. Although those restated financial statements have
now been filed, Ford has received informal inquiry letters from
the SEC seeking further information regarding the restatements.
Standard & Poor's would reassess its views on the rating effect if
the SEC inquiry process were to uncover additional issues or raise
broader concerns about the strength of Ford's internal controls or
risk-management practices, if additional restatements resulted, or
if liquidity were adversely affected.
FRANKLIN MORTGAGE: Fitch Rates $7 Million Class B Certs. at BB+
---------------------------------------------------------------
Fitch rates First Franklin Mortgage Loan Trust mortgage pass-
through certificates, series 2006-FF17:
-- $651.6 million classes A1 through A6 'AAA';
-- $24.9 million class M1 'AA+';
-- $21.8 million class M2 'AA';
-- $13.2 million class M3 'AA-';
-- $11.7 million class M4 'A+';
-- $11.3 million class M5 'A';
-- $9.3 million class M6 'A-';
-- $6.6 million class M7 'BBB+';
-- $4.7 million class M8 'BBB';
-- $7.8 million class M9 'BBB-'; and,
-- $7 million class B 'BB+' (144A).
The 'AAA' rating on the senior certificates reflects the 16.15%
total credit enhancement provided by the 3.20% class M1, the 2.80%
class M2, the 1.70% class M3, the 1.50% class M4, the 1.45% class
M5, the 1.20% class M6, the 0.85% class M7, the 0.60% class M8,
the 1.00% class M9, the privately offered 0.90% class B, and the
0.95% initial overcollateralization.
All certificates have the benefit of monthly excess cash flow to
absorb losses. An interest rate swap agreement and an interest
rate cap agreement, both with ABN AMRO Bank N.V., are also
available to cover interest shortfalls and losses.
In addition, the ratings reflect the quality of the loans, the
integrity of the transaction's legal structure as well as the
primary servicing capabilities of National City Home Loan
Services, Inc. and Wells Fargo Bank, N.A. as Trustee.
The mortgage loans are divided into three groups of first-lien,
fixed-rate and adjustable mortgage loans. The Pool I mortgage
loans had an aggregate principal balance of $167,725,366 as of the
cut-off date, Nov. 1, 2006. The weighted average loan rate of the
Pool I mortgage loans is approximately 8.178%. The weighted
average remaining term to maturity is 356 months. The average
cut-off date principal balance of the mortgage loans is
approximately $138,501. The weighted average original loan-to-
value ratio is 82.96% and the weighted average Fair, Isaac & Co.
score was 640. The properties are primarily located in
California, Florida and Illinois.
The Pool II mortgage loans had an aggregate principal balance of
$135,283,691 as of the cut-off date. The weighted average loan
rate of the Pool II mortgage loans is approximately 8.198%. The
weighted average remaining term to maturity is 358 months. The
average cut-off date principal balance of the mortgage loans is
approximately $146,569. The weighted average OLTV ratio is 84.07%
and the weighted average FICO score was 636. The properties are
primarily located in California, Florida and Illinois.
The Pool III mortgage loans had an aggregate principal balance of
$474,133,363 as of the cut-off date. The weighted average loan
rate of the Pool III mortgage loans is approximately 8.037%. The
weighted average remaining term to maturity is 357 months. The
average cut-off date principal balance of the mortgage loans is
approximately $248,237. The weighted average OLTV ratio is 83.80%
and the weighted average FICO score was 656. The properties are
primarily located in California, Florida and New York.
GMAC LLC: GM Stake Sale Cues S&P to Upgrade Credit Rating to BB+
----------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on GMAC LLC
to 'BB+/B-1' from 'BB/B-1' and removed them from CreditWatch,
where they were placed on Oct. 3, 2005.
The outlook is now developing.
At the same time, Standard & Poor's raised its ratings on GMAC's
subsidiary, Residential Capital LLC, to 'BBB/A-3' from 'BBB-A-3'
and removed them from CreditWatch, where they were placed on
Oct. 3, 2005.
The outlook is negative.
The upgrades reflect the benefits to GMAC and ResCap that will
result from ultimate parent General Motors Corp.'s sale of a
51% ownership stake in GMAC to a consortium headed by Cerberus
Capital Management L.P., in a transaction Standard & Poor's
expects will close shortly.
Standard & Poor's believe the transaction will result in a lower
risk of default at GMAC than at GM, making it appropriate to sever
the absolute correlation in the ratings between the two.
"Although GMAC will continue to bear some risks stemming from
its business and ownership ties to GM, the protections afforded by
the transaction, combined with the diversity of GMAC's mortgage
and insurance businesses, its excellent asset quality, and
significant profit potential, are sufficient to justify a higher
rating on GMAC than on GM," explained Standard & Poor's credit
analyst Scott Sprinzen.
The ratings on GM remain on CreditWatch, although the rating
agency is now in the final stages of resolving the analytical
issues in this review.
Chief among the measures that afford substantial protection to
GMAC creditors are:
With the reduction in GM's ownership stake in GMAC, if GM were to
file for bankruptcy, GM would not be able unilaterally to cause
GMAC to also file for bankruptcy protection.
Under U.S. pension regulations, GMAC will no longer be part of the
GM "control group," and so would not be liable for any unfunded
pension liability of GM's, should GM's U.S. pension plans be
terminated.
The Pension Benefit Guaranty Corp. has formally agreed that it
will not seek to impose any liability upon GMAC under such
circumstances.
Various existing arrangements between GMAC and GM have been
modified, and intercompany borrowings have been largely repaid, in
order to limit GMAC's ongoing direct credit exposure to GM. Going
forward, GMAC's direct unsecured credit exposure to GM will be
capped at $1.5 billion.
Under governance procedures that have been implemented, GM's
ability to influence GMAC's operating policies-including its
underwriting standards-will be significantly restricted; GMAC's
financial leverage will decline over the next few years, since
GMAC will retain a significant portion of its earnings, and
Cerberus is contractually committed to reinvest a portion of the
dividends it receives back into GMAC in the form of preferred
stock.
The rating agency assumes the capital markets will, like Standard
& Poor's, view the transaction favorably, which should enhance
GMAC's access to the unsecured term debt market, thereby improving
its funding flexibility and reducing its borrowing costs; and
GMAC's funding flexibility will also benefit from $25 billion of
new funding facilities, including $10 billion already provided by
Citigroup, which is one of the consortium members.
Despite the beneficial aspects of the proposed transaction, GMAC
will continue to face some GM-related risks. In particular, the
value of GMAC's core automotive finance franchise will still be
influenced by GM's fortunes.
If GM's competitiveness deteriorates further, especially if GM
were ultimately to declare bankruptcy, this could have a severe
effect on the credit and residual loss levels associated with
GMAC's retail and wholesale loan and lease portfolios.
There are limits on GMAC's ability to contain its GM-related
credit exposure: GMAC is required to continue allocating capital
to provide financing to GM customers and wholesale dealers in
accordance with historical practice.
Although GMAC retains the right to make individual credit
decisions, GMAC has committed to funding a broad credit spectrum
of customers and dealers largely consistent with historical
practice.
In addition, some of GMAC's outstanding dealer floor plan
securitizations include a bankruptcy filing by GM among the early
amortization triggers: were there to be a GM bankruptcy, this
would necessitate GMAC drawing on alternative liquidity sources.
In addition, Standard & Poor's believes there is potential for
future divisiveness among GMAC's owners from diverging business or
economic interests. Moreover, potential further ownership
changes in the long term are unknown: the consortium is required
to retain its investment in GMAC for only five years.
GMAC has been able to sustain adequate profitability in recent
years, notwithstanding the turmoil caused by GM's business and
financial setbacks. GMAC's earnings should be bolstered over the
next few years by more favorable funding costs, the reversal of
operating constraints imposed in reaction to funding constraints,
and new growth and cost-cutting initiatives across its diverse
business lines, although broadly worsening consumer credit
conditions and the downturn in the U.S. housing sector will be
limiting factors.
The developing outlook indicates there is some potential for the
ratings on GMAC to be either raised or lowered within the next two
years. Ratings could be raised if management's strategic
initiatives are more successful than currently assumed by Standard
& Poor's in enhancing GMAC's profitability-for example, with ROE
reaching the upper teens.
Improvement in GM's prospects-for example, stemming from
improvement of operating and financial performance and the
satisfactory resolution of uncertainties regarding its former
affiliate, Delphi Corp. and GM's 2007 labor contract negotiations-
would also be a significant positive development. However,
Standard & Poor's would still need to consider
uncertainty regarding GMAC's ownership structure beyond the next
five years.
On the other hand, the ratings on GMAC could be lowered given
deterioration at GM that threatens to impinge on GMAC's financial
performance and funding flexibility.
While Standard & Poor's now believes GMAC could survive a
bankruptcy filing by GM, the ratings on GMAC would likely be
lowered were this to occur-possibly by several notches-given the
uncertainties such a development would entail for GMAC.
Standard & Poor's sees limited upside potential for the ratings on
ResCap over the next few years, given the current downturn in its
principal markets. Were the ratings on GMAC to be raised, though,
ResCap's rating outlook would likely be revised to stable. On the
other hand, the ratings on ResCap would likely be
lowered if those on GMAC were lowered.
GREAT PLAINS: Earns $54.7 Million in Third Quarter of 2006
-----------------------------------------------------------
Great Plains Energy Inc. reported core earnings of $56.8 million
in the third quarter of 2006, compared to $77.9 million in the
third quarter of 2005. Reported earnings were $54.7 million,
compared to third quarter 2005 earnings of $90.4 million. Core
earnings exclude net mart-to-market gains and losses on energy
contracts.
At Sept. 30, 2006, Great Plains Energy's balance sheet showed
$4.11 billion in total assets, $2.03 billion in total liabilities,
and $2.08 billion in total stockholders' equity.
The company's balance sheet at Sept. 30, 2006, also showed
strained liquidity with $555 million in total current assets
available to pay $996.2 million in total current liabilities.
The difference in core earnings for the third quarter of 2006
compared to the third quarter last year was driven primarily by
increases to 2005 earnings of $16.7 million of tax benefits and
$3.5 million due to pension benefits that were not present in
2006.
Year to date core earnings were $122.9 million, compared to $118.4
million for the same period last year. Reported earnings for the
first nine months were $89.4 million, compared to $131.7 million
for the same period last year.
Great Plains Energy's year to date core earnings were largely
driven by margin improvement at Strategic Energy LLC with higher
wholesale prices and lower purchased power expense at its wholly
owned subsidiary, Kansas City Power & Light Co., offset by the tax
benefits and pension benefits in the third quarter of 2005 that
were not present in 2006.
"KCP&L and Strategic Energy have produced strong results through
the third quarter which support our current 2006 earnings
guidance," said Chairman Mike Chesser. "Importantly, with the
progress on the Comprehensive Energy Plan and continued backlog
growth at Strategic Energy, we believe Great Plains Energy is
positioned to deliver attractive long term earnings growth."
Based in Kansas City, Missouri, Great Plains Energy Incorporated
(NYSE:GXP) -- http://www.greatplainsenergy.com/-- is the holding
company for Kansas City Power & Light Company, a regulated
provider of electricity in the Midwest, and Strategic Energy
L.L.C., a competitive electricity supplier.
* * *
Great Plains Energy's preferred stock carries Moody's Investors
Service's Ba1 rating.
HILTON HOTELS: Seeks Modification of Partial Final Judgment
-----------------------------------------------------------
Hilton Hotels Corp. -- a party defendant in a partial final
judgment entered in the United States versus Greater Portland
Convention Association, Inc., et al., Civil No. 70-310, on
Nov. 29, 1971 -- has filed a request with the Antitrust Division
of the U.S. Department of Justice to modify the Partial Final
Judgment.
Hilton Hotels is publishing a notice of its intention to seek
modification of the Partial Final Judgment so that any interested
persons can submit comments to the Antitrust Division regarding
the proposed modification.
The Partial Final Judgment settled the United States' complaint
alleging violations of Section 1 of the Sherman Act, 15 U.S.C. 1,
against:
-- Greater Portland Convention Association, Inc.;
-- Hilton Hotels Corp.;
-- ITT Sheraton Corp. of America; and
-- Cosmopolitan Investment, Inc.
The Partial Final Judgment prohibits defendants and their
subsidiaries, successors and assigns from, inter alia:
(1) agreeing with any other hotel to give or promise to
give preferential treatment for the purchase of
hotel supplies to hotel suppliers, or
(2) giving or promising to give preferential treatment
for the purchase of hotel supplies to any hotel
suppliers on the basis of payments, contributions,
or dues paid by suppliers to any convention bureau.
While the latter prohibition, contained in V of the Partial Final
Judgment, will not be affected by the proposed modification.
Hilton Hotels' proposed to add to the prohibition in Section IV of
the Partial Final Judgment:
Provided, however, that nothing in this Section shall be construed
to prohibit any hotel defendant from:
1. Developing hotel supply purchasing programs for its
owned, managed and franchised hotels; or
2. Participating in bona fide group purchasing
organizations or programs notwithstanding the fact
that the organizations or programs may include one
or more other hotels.
Hilton Hotels is seeking these modifications to ensure that IV of
the Partial Final Judgment would not be interpreted so as to
prohibit the hotel defendants from engaging in these specified
activities.
Hilton Hotels understands that in the course of evaluating the
request, the Antitrust Division will also consider whether the
Partial Final Judgment should be terminated.
Interested persons may submit comments on the proposed
modification and a potential termination of the Partial Final
Judgment to the Antitrust Division within 30 days. Comments
should be addressed to:
John R. Read
Chief, Litigation III Section
Antitrust Division, U.S. Department of Justice
Liberty Place Building, 325 Seventh Street, N.W.
Suite 300, Washington, D.C. 20530
Headquartered in Beverly Hills, California, Hilton Hotels Corp.
-- http://www.hilton.com/-- together with its subsidiaries,
engages in the ownership, management, and development of hotels,
resorts, and timeshare properties, as well as in the franchising
of lodging properties in the United States and internationally,
including Australia, Austria, Barbados, India, Indonesia,
Trinidad and Tobago, Philippines and Vietnam.
* * *
Moody's Investors Service confirmed its Ba2 Corporate Family
Rating for Hilton Hotels Corporation in connection with its
implementation of its new Probability-of-Default and Loss-Given-
Default rating methodology for the gaming, lodging and leisure
sectors.
INNUITY INC: Posts $1.7 Million Net Loss in Quarter Ended Sept. 30
------------------------------------------------------------------
Innuity Inc. reported a $1.7 million net loss for the quarter
ended Sept. 30, 2006, compared to a $2.4 million net loss for the
third quarter of 2005. The net loss for the third quarter of 2006
before non-cash items was $525,000, an improvement of $200,000,
from a $725,000 net loss before non-cash items during the second
quarter of 2006.
Innuity's loss from operations improved to $1.6 million for the
third quarter of 2006 ,as compared to a $2.3 million loss from
operations during the same quarter of 2005.
Consolidated revenues for the third quarter of 2006 increased 15%
to $5.4 million from $4.7 million reported during the same quarter
of 2005. Contributing to this revenue increase was significant
growth in Innuity's In-Store Systems business line, which is part
of the company's Commerce division.
Consolidated revenues were $16 million for the nine months ended
September 30, 2006, compared to consolidated revenues of
$7.8 million for the nine months ended Sept. 30, 2005, an increase
of 140%. The company's net loss for the nine months ended Sept.
30, 2006, was $6.7 million compared to a net loss of $7.1 million
for the same nine months in 2005.
At Sept. 30, 2006, the Company's balance sheet showed $7,049,864
in total assets and $9,466,184 in total liabilities, resulting in
a $2,416,320 stockholders' deficit.
"By combining the exciting growth prospects of our existing
offerings with a well-executed acquisition strategy, we believe
Innuity can continue its momentum as we progress into the fourth
quarter. We feel our business strategy will allow us to continue
to provide our small business customers with a more efficient and
valuable means of doing business," said John Wall, chairman and
chief executive officer of Innuity. "We plan to continue to offer
the growing numbers of small business owners on-demand services
that will enhance their results and believe these efforts will
equate into building a sound infrastructure to support and
facilitate Innuity's future growth."
Mr. Wall continued, "During the past several months we have worked
diligently to strengthen the company's financial position, and we
have steadily improved our net loss. We believe Innuity has a
winning strategy that will enable us to capitalize on our
operating efficiencies and continue to make significant financial
improvements, all of which will combine to benefit our customers
and shareholders."
A full-text copy of the Company's quarterly report is available
for free at http://researcharchives.com/t/s?15e8
Creditdiscovery Acquisition
Innuity has entered into an agreement to acquire substantially all
of the assets of Creditdiscovery LLC and Acquirint LLC for an
aggregate purchase price of 454,000 shares of Innuity's common
stock and the assumption of $95,000 in liabilities.
The board of directors of each company has approved the
acquisitions. The acquisitions are subject to various conditions
to close, including the completion of due diligence by Innuity and
other customary closing conditions.
Creditdiscovery develops and delivers web-based credit card
processing products and services to the merchant acquiring
business, banking and financial institutions. Creditdiscovery's
merchant life cycle management products provide rapid merchant
account application processing, real time credit scoring, boarding
automation, contract origination, settlement and clearing data,
risk management and profitability and residual management.
Acquirint is currently the only licensed reseller of
Creditdiscovery's merchant accounting system and full-service
independent sales organization solutions.
Innuity plans to integrate Creditdiscovery's merchant life cycle
management products into its Merchant Services business line's
existing suite of payment processing, service provider
applications and acquiring solutions for the bank card services
and payment processing industry. Innuity sees Creditdiscovery's
web-based merchant account application, booking and boarding,
fulfillment and risk management tools as bringing a new set of
complementary, robust capabilities to Innuity and it partners. As
part of the integration process, Innuity's Merchant Services
business line plans to simplify and adapt product delivery,
pricing and service contracts to better and more cost-effectively
serve the market.
Going Concern Doubt
Hansen, Barnett & Maxwell in Salt Lake City, Utah, raised
substantial doubt about Innuity's ability to continue as a going
concern after auditing the company's consolidated financial
statements for the years ended Dec. 31, 2005, and 2004. The
auditor pointed to the company's accumulated deficit, losses from
operations, negative cash flows from operating activities and
working capital, and capital deficiency.
Innuity, Inc. (OTCBB:INNU) -- http://innuity.com/-- is an
Internet technology company that designs, acquires, and integrates
applications to deliver software for small business. The
company's Internet technology is based on an affordable, on-demand
model that allows small businesses to interact simply with
customers, business partners, and vendors and to manage their
businesses efficiently. Using the company's on-demand
applications, small businesses can grow their revenues, reach and
serve customers, and run everyday operations.
INTEGRATED ALARM: S&P Affirms 'B-' Second-Lien Debt Ratings
-----------------------------------------------------------
Standard & Poor's Ratings Services kept its 'B' corporate credit
and 'B-' second-lien debt ratings on Albany, New York-based
Integrated Alarm Services Group Inc. on CreditWatch with negative
implications, where they were placed on April 26, 2006.
"The ratings were placed on CreditWatch reflecting uncertainty
surrounding IASG's operating prospects given continued
underperformance in alarm contract acquisitions, heightened
attrition rates, and a review of strategic options for the
company," said Standard & Poor's credit analyst Ben Bubeck.
A management transition, completed in June 2006, also drove
Standard & Poor's CreditWatch listing.
IASG hired an investment bank in July 2006 to perform a review of
IASG's strategic options under the new management team, which is
ongoing. While revenue has trended downward sequentially over
each of the past three quarters, management has recently
reiterated its expectation of acquiring 5,000 accounts in the
second half of 2006.
Attrition rates continue to track high relative to other rated
alarm monitoring companies.
Standard & Poor's will continue to monitor the ongoing review of
strategic alternatives, and, once completed, will meet with
management to discuss the intermediate- and long-term strategic
direction of the company in order to resolve the CreditWatch
listing.
Ratings List:
* Integrated Alarm Services Group Inc.
* Ratings Remain On CreditWatch
-- Corporate credit rating at B/Watch Neg
-- Second-lien senior secured debt at B-/Watch Neg
INTERSTATE BAKERIES: Brencourt Calls for Stockholders' Meeting
--------------------------------------------------------------
In a regulatory filing with the Securities and Exchange
Commission, Michael Palmer, chief financial officer of Brencourt
Advisors LLC, reports that the company has filed a complaint
pursuant to Section 211(c) of the Delaware General Corporation
Law asking the Court of Chancery of the State of Delaware to:
(a) require Interstate Bakeries Corporation to immediately
convene an annual meeting of stockholders, with the time,
place, record date and form of notice for the meeting and
number of directors to be elected at the meeting to be
specified by the Court;
(b) declare that stockholders may nominate persons for
election as director for the annual meeting free of any
advance notification or advance nomination bylaw or
charter provisions, and fix other terms and conditions for
the meeting as the Court may deem appropriate; and
(c) award Brencourt its costs and expenses, including
reasonable attorneys' fees, incurred in the prosecution of
the action.
A full-text copy of the Brencourt Complaint is available for free
at http://ResearchArchives.com/t/s?1578
Brencourt chief executive officer William Collins sent on Nov. 7,
2006, a letter to Leo Banatar, chairman of IBC's Board of
Directors, to raise Brencourt's concerns on IBC's declining
performance in the past years. Brencourt believes that the root
cause of IBC's decline is its Board. Mr. Collins points out that
the members of the IBC Board have been the same since the late
1990s, and have allowed IBC to operate without a chief financial
officer.
Brencourt believes that IBC needs a new, capable Board with the
skills to properly oversee the company's reorganization and
operational turnaround.
The restructuring efforts pursued by Alvarez & Marsal have not
worked and given IBC's track record, Brencourt has no confidence
in the current Board to successfully implement a turnaround of
the business, Mr. Collins says.
A full-text copy of the November 7 Brencourt Letter is available
for free at http://ResearchArchives.com/t/s?157d
IBC Seeks to Delay Brencourt Proceedings
In a separate regulatory filing with the SEC, the Debtors
disclose that they filed a letter filed with the Delaware
Chancery Court on Nov. 16, 2006, asking it to delay the
scheduled trial of the Brencourt Action.
The Debtors assert that Brencourt's proposed trial schedule on
Dec. 18, 2006, is too aggressive.
It is the Missouri Bankruptcy Court, not the stockholders that
should oversee the Debtors' Chapter 11 proceedings under both
Delaware and federal law. Thus, the Debtors contend, the issue
of who should constitute the company's Board should be submitted
to the Bankruptcy Court in the first instance.
The Debtors inform the Delaware Chancery Court that they are
currently negotiating with their secured lenders, the Official
Committee of Unsecured Creditors and the Official Committee of
Equity Security Holders regarding the makeup of the Board.
A board meeting to consider any compromise board composition
proposals or to authorize a motion to reconstitute the Board was
scheduled yesterday.
Thus, the Debtors urge the Delaware Chancery Court to hold off
scheduling a trial until after the Bankruptcy Court rules on any
motion to reconstitute to minimize any waste of their resources.
Even absent the bankruptcy issues, the Debtors note that they
would ask the Delaware Court not to set a trial date until late
January at the earliest because they need to focus on achieving
current financial statements by Dec. 31, 2006. The financial
statements are a condition to a proposed settlement of a pending
SEC investigation regarding the Debtors' accounting practices.
A full-text copy of IBC's Letter is available for free at
http://ResearchArchives.com/t/s?157e
Headquartered in Kansas City, Missouri, Interstate Bakeries
Corporation is a wholesale baker and distributor of fresh baked
bread and sweet goods, under various national brand names,
including Wonder(R), Hostess(R), Dolly Madison(R), Baker's Inn(R),
Merita(R) and Drake's(R). The Company employs approximately
32,000 in 54 bakeries, more than 1,000 distribution centers and
1,200 thrift stores throughout the U.S. The Company and seven of
its debtor-affiliates filed for chapter 11 protection on
September 22, 2004 (Bankr. W.D. Mo. Case No. 04-45814). J. Eric
Ivester, Esq., and Samuel S. Ory, Esq., at Skadden, Arps, Slate,
Meagher & Flom LLP, represent the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they listed $1,626,425,000 in total assets and
$1,321,713,000 (excluding the $100,000,000 issue of 6.0% senior
subordinated convertible notes due Aug. 15, 2014, on Aug. 12,
2004) in total debts. (Interstate Bakeries Bankruptcy News, Issue
No. 52; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
JABIL CIRCUIT: To Acquire All Shares of Taiwan Green Point
----------------------------------------------------------
Jabil Circuit Inc. plans to acquire 100% of the outstanding shares
of Taiwan Green Point Enterprises Co. Ltd. for TWD109 per share in
cash through a wholly owned Jabil subsidiary. The acquisition
includes nine Asian plants, including seven located in China and
one in both Taiwan and Malaysia.
"We are thrilled to announce this deal with Green Point
Enterprises -- a market leader in advanced electro-mechanical
manufacturing and services for the mobile product and consumer
market," said Tim Main, President and CEO of Jabil. "Green Point
has significant scale in the design and production of advanced
plastics and metals for the mobile products market. When combined
with Jabil's global infrastructure, systems and electronic
expertise, we will possess a market leading end-to-end capability
with outstanding long-term growth prospects."
Per the proposed agreement, approximately 30,000 Green Point
employees will join Jabil, including the current management team.
The Green Point name will be retained and will operate as an
independent business within Jabil. Jabil and Green Point
management will work together to jointly market the integrated
services.
"Acquiring Green Point is a natural extension of Jabil's business
strategy to provide sector-specific supply chain solutions to our
diversified base of customers," said Mr. Main. "Our growth
strategy contemplates diversification of end-markets served and
providing a best in class end-to-end solution within each of those
segments. Electro-mechanical integration in the consumer and
mobile products market is consistent with this strategy."
Mr. Main said Jabil would continue to utilize a well-developed set
of strategic component suppliers in our other segments.
The acquisition provides Jabil with new capabilities in advanced
decoration and coating technologies and will augment existing
and new customer relationships. Mr. Main said that Jabil must
continually evolve its service offerings to the changing global
market conditions.
The transaction is structured as a tender offer for all of the
outstanding shares of Green Point followed by a merger. It is
currently anticipated that the tender offer will be launched on
Thursday, Nov. 23, 2006 in Taiwan and remain open for 50 days.
The tender offer may be extended or withdrawn for certain reasons.
The closing of the tender offer is subject to customary closing
conditions, including competition clearance under the laws of
Taiwan and China and acquisition of a majority of the outstanding
Green Point shares in the tender offer.
Shareholders owning approximately 42.7% of the outstanding shares
of Green Point common stock have entered into agreements under
which they have agreed to tender their shares to Jabil. Assuming
that the Tender is successfully closed, it is then anticipated
that the two companies will merge pursuant to a merger agreement
between them that provides any remaining shareholders TWD109 cash
per share.
Completion of the merger, which would be subject to approval by
Green Point's shareholders after the tender closes, would be
expected to take place in Jabil's fiscal third quarter. The
purchase price, depending upon final shares outstanding and the
exchange rate at the time of the closing is anticipated to be
between $875 and $900 million.
About Jabil Circuit
Jabil Circuit, Inc. (NYSE:JBL) -- http://www.jabil.com/-- is
an electronic product solutions company providing comprehensive
electronics design, manufacturing and product management services
to global electronics and technology companies. Jabil Circuit has
more than 50,000 employees and facilities in 20 countries.
* * *
Standard & Poor's Ratings Services placed a BB+ preliminary rating
on Jabil Circuit's $1.5 billion senior and subordinated debts on
Aug. 19, 2005.
M. FABRIKANT & SONS: Quashes Speculations on Units' Bankruptcy
--------------------------------------------------------------
On Nov. 17, 2006, M. Fabrikant and Sons, Inc., and its domestic
affiliate Fabrikant-Leer International Ltd., filed voluntary
petitions for relief under Chapter 11 of the United States
Bankruptcy Code. Since that time, there has been speculation as to
the status of various other Fabrikant affiliated or related
entities.
Fabrikant-Tara International, LLC, a diamond and gemstone jewelry
wholesaler, primarily owned by Tara Jewels Holdings, Inc. and, in
part, by M. Fabrikant & Sons, has not filed for chapter 11 relief
of the Bankruptcy Code and does not anticipate that the bankruptcy
filings of M. Fabrikant & Sons, Inc. or Fabrikant-Leer
International, Ltd. will adversely affect its operations.
Fabrikant-Tara International, LLC, continues to operate its
business and fulfill all of its commitments to its vendors and
customers.
Headquartered in New York City, M. Fabrikant & Sons, Inc. --
http://www.fabrikant.com/-- sells diamonds and jewelries. The
Company and its affiliates, Fabrikant-Leer International, Ltd.,
filed for chapter 11 protection on Nov. 17, 2006 (Bankr. S.D.N.Y.
Case Nos. 06-12737 & 06-12739). Mitchel H. Perkiel, Esq., at
Troutman Sanders LLP, represent the Debtors. When the Debtors
filed for protection from their creditors, they listed estimated
assets and debts of more than $100 million. The Debtors'
exclusive period to file a chapter 11 plan expires on Mar. 17,
2007.
MAGSTAR TECHNOLOGIES: Earns $465,020 in Quarter Ended September 30
------------------------------------------------------------------
MagStar Technologies Inc. reported a $465,020 net income on
$2,315,781 of net sales for the three months ended Sept. 30, 2006,
versus a $149,824 net income on $2,338,739 of net sales for the
three months ended Sept. 30, 2005.
MagStar Technologies' balance sheet at Sept. 30, 2006, showed a
stockholders' deficit of $2,558,083, compared to a deficit of
$4,510,158 at Dec. 31, 2005.
At Sept. 30, 2006, the Company had working capital of $729,260,
compared to a working capital deficiency of $3,004,467 at Dec. 31,
2005. The increase in working capital is due to debt
restructuring, modification of lease agreements and as a result of
profits during the quarter and nine months ended Sept. 30, 2006.
A full-text copy of the regulatory filing is available for free
at http://ResearchArchives.com/t/s?15f1
Going Concern Doubt
As reported in the Troubled Company Reporter on May 16, 2006,
Virchow, Krause & Company LLP expressed substantial doubt about
MagStar Technologies, 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 auditing firm pointed to
the Company's recurring losses from operations as well as its
total liabilities exceeding its total assets.
About MagStar Technologies
Headquartered in Hopkins, Minnesota, MagStar Technologies Inc.
develops and manufactures centrifuges, conveyors, medical devices,
spindles, and sub assemblies for medical, magnetic, motion control
and industrial original equipment manufacturers. The Company
manufactures close tolerance bearing-related assemblies for the
medical device industry. The Company also contract manufactures
biometric identification assemblies, spindles, precision slides
and complex magnetic assemblies. The Company's products are sold
throughout the United States and North America, Europe, and Asia.
MAXCOM TELECOM: Moody's Rates Proposed $200 Mil. Sr. Notes at B3
----------------------------------------------------------------
Moody's Investors Service assigned a B3 rating to Maxcom
Telecomunicaciones S.A. de C.V.'s proposed $200 million senior
unsecured notes due 2016.
Moody's also assigned a B3 corporate family rating to Maxcom.
The ratings reflect Maxcom's modest size, limited operating
history, high churn and foreign exchange exposure. The stable
outlook reflects Moody's expectation of a steady improvement in
Maxcom's credit metrics in the medium term.
Proceeds from the proposed notes will be used to repay existing
debt and for capital expenditures. The transaction will lengthen
Maxcom's debt maturity profile and facilitate growth investments.
The ratings reflect Maxcom's limited operating history and
relatively high churn at 1.6% monthly. Even though in the last
two years the company has increased lines in service and revenues
at an annual average rate of 26% and 32%, respectively, previous
periods were marked with low returns and the need to recapitalize
debt.
Maxcom's ratings are also restrained by its low national market
share, although homes passed penetration is relatively high at 38%
in Puebla, 36% in Mexico City and 28% in Queretaro, Maxcom's main
markets. Moody's expects that the proposed issue will be hedged
for foreign exchange exposure, therefore minimizing the FX risk
derived from this U.S. dollar debt.
Interest coverage, measured by funds from operations plus interest
expenses to interest expenses at 2.2x expected for 2006, supports
Maxcom's ratings.
In addition, past equity capitalizations have strengthened
Maxcom's financial health and the proceeds of the proposed notes
should help the company take further advantage of business
opportunities in the large and under-penetrated social segments of
the population to which it provides services.
Continuous benefits on margins from increased scale coupled with a
cost efficient network build-out and a successful sales force that
manages to sell 85% of lines within 3 months of construction
sustain Maxcom's B3 ratings.
The stable outlook reflects Moody's expectation that Maxcom will
post double-digit growth rates in the next years and therefore
profit from economies of scale in a business environment that
should be characterized by increasing fixed line penetration in
the social economic segments to which the company offers its
services. A higher subscriber base should help offset the
negative impact on ARPU from a more difficult competitive business
atmosphere with the continuous wireless substitution as well as
the entrance of cable TV providers into the voice telecom service
business.
However, most of Maxcom's generated cash is expected to be
invested in capital expenditures, limiting important improvements
in credit protection metrics.
Upward pressure on Maxcom's rating would be related to the
company's ability to reduce its debt burden, evidenced by a
leverage ratio of approximately 3 times adjusted debt/EBITDA.
Downward pressure, though, would exist if double-digit revenues
growth rate targets are not met with a consequent impact on credit
protections metrics, such as adjusted debt to EBITDA reaching the
5 times threshold.
Maxcom, with headquarters in Mexico City, is a competitive local
telephone company providing bundled products including voice, data
and cable television. During the last twelve months ended in
Sept. 2006, Maxcom posted revenues of approximately
$135 million with a 30% adjusted EBITDA margin.
MCKESSON CORP: Extends Pharmaceutical Agreement with Wal-Mart
-------------------------------------------------------------
McKesson Corporation has renewed its comprehensive supply
agreement with Wal-Mart Stores, Inc. The agreement extends the
companies' relationship, which dates back to 1988, and maintains
McKesson as the primary supplier of brand pharmaceutical products
for Wal-Mart stores.
"We are pleased to extend our longstanding and extensive
relationship with Wal-Mart," said John Figueroa, President of
McKesson Pharmaceuticals, the company's domestic pharmaceutical
distribution business unit.
In addition, McKesson will continue to be a supplier to Wal-Mart's
mail order facility and warehouses. McKesson will also continue
to provide repackaging services through its RxPak business.
Headquartered in San Francisco, California, McKesson Corp.
(NYSE: MCK) -- http://www.mckesson.com/-- is a Fortune 15
healthcare services and information technology company dedicated
to helping its customers deliver high-quality healthcare by
reducing costs, streamlining processes and improving the quality
and safety of patient care. Over the course of its 172-year
history, McKesson has grown by providing pharmaceutical and
medical-surgical supply management across the spectrum of care;
healthcare information technology for hospitals, physicians,
homecare and payors; hospital and retail pharmacy automation;
and services for manufacturers and payors designed to improve
outcomes for patients.
* * *
Moody's Investors Service affirmed McKesson Corporation's Junior
subordinated notes at Ba1; Sr. subordinated shelf at (P) Ba1;
Subordinated shelf at (P) Ba1; Junior subordinated shelf at (P)
Ba1; and Preferred shelf at (P)Ba1.
MERIDIAN AUTOMOTIVE: Reschedules Confirmation Hearing to Dec. 6
---------------------------------------------------------------
Meridian Automotive Systems Inc. rescheduled the confirmation
hearing regarding its Plan of Reorganization from Nov. 29, 2006 to
Dec. 6, 2006. Meridian requested the short adjournment to allow
its creditor constituencies time to finalize certain agreements
related to the Plan. Meridian still expects that its Plan will
become effective in December 2006.
Meriden also filed a motion seeking approval of the commitment
from Deutsche Bank to provide the $175 million exit financing to
implement the Plan. The hearing to approve the financing
commitment is scheduled for today, Nov. 29, 2006.
"We remain on track to emerge from Chapter 11 by the end of the
year," Richard E. Newsted, Meridian's President and CEO, said.
"The many necessary elements for our Plan to become effective are
falling into place thanks to the focus and hard work of the
Meridian team, our professional advisors, Deutsche Bank and the
strong support of our major secured creditor classes and the
Official Committee of Unsecured Creditors."
Based in Dearborn, Michigan, Meridian Automotive Systems, Inc. --
http://www.meridianautosystems.com/-- supplies technologically
advanced front and rear end modules, lighting, exterior
composites, console modules, instrument panels and other interior
systems to automobile and truck manufacturers. Meridian
operates 22 plants in the United States, Canada and Mexico,
supplying Original Equipment Manufacturers and major Tier One
parts suppliers. The Company and its debtor-affiliates filed for
chapter 11 protection on April 26, 2005 (Bankr. D. Del. Case Nos.
05-11168 through 05-11176). James F. Conlan, Esq., Larry J.
Nyhan, Esq., Paul S. Caruso, Esq., and Bojan Guzina, Esq., at
Sidley Austin Brown & Wood LLP, and Robert S. Brady, Esq., Edmon
L. Morton, Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks,
Esq., at Young Conaway Stargatt & Taylor, LLP, represent the
Debtors in their restructuring efforts. Eric E. Sagerman, Esq.,
at Winston & Strawn LLP represents the Official Committee of
Unsecured Creditors. The Committee also hired Ian Connor
Bifferato, Esq., at Bifferato, Gentilotti, Biden & Balick, P.A.,
to prosecute an adversary proceeding against Meridian's First Lien
Lenders and Second Lien Lenders to invalidate their liens. When
the Debtors filed for protection from their creditors, they listed
$530 million in total assets and approximately $815 million in
total liabilities.
MERIDIAN AUTOMOTIVE: Files Revised Plan Compendium Exhibits
-----------------------------------------------------------
Meridian Automotive Systems Inc. and its debtor-affiliates
delivered on Nov. 22, 2006, to the U.S. Bankruptcy Court for the
District of Delaware further revised Plan Compendium exhibits to
the Fourth Amended Joint Plan of Reorganization:
1. Senior Secured Exit Financing Commitment Letter
The Debtors filed with the Court a commitment letter from
Deutsche Bank Trust Company Americas and a syndicate of
lenders for the provision of a proposed senior secured
financing.
Deutsche Bank Americas commits to provide Reorganized
Meridian, among other things:
* an asset-based revolving credit facility in an aggregate
principal amount of $70,000,000; and
* an uncommitted Incremental ABL Facility aggregating
$30,000,000.
Deutsche Bank Securities Inc. will act as sole lead arranger
and sole bookrunner for each of the Credit Facilities.
The Debtors filed a separate pleading, seeking the Court's
authority to enter into the ABL Commitment Letter.
2. Certificate of Incorporation
The Board of Directors of the Reorganized Debtors will
initially consist of five directors. The number of directors
may be amended from time to time, provided that it will not be
less than five nor more than seven. The term of any
incumbent director may not be modified.
A full-text copy of the Debtors' Certificate of Incorporation
is available for free at http://ResearchArchives.com/t/s?15f6
3. By-Laws
The officers of Meridian Automotive Systems, Inc., will be
chosen by the Board of Directors and need not be stockholders
or directors of MASI.
A full-text copy of Meridian's By-Laws is available for free
at http://ResearchArchives.com/t/s?15f8
4. Agreement and Plan of Merger, a full-text copy of which is
available for free at http://ResearchArchives.com/t/s?15f9
5. Michigan Merger Certificate, a full-text copy of which is
available for free at http://ResearchArchives.com/t/s?15fa
6. Delaware Merger Certificate, a full-text copy of which is
available for free at http://ResearchArchives.com/t/s?15fb
7. Litigation Trust Agreement
On the Effective Date, Meridian Automotive Systems, Inc., will
deliver to the Litigation Trust $2,000,000 cash pursuant to
the Secured Credit Agreement. The Initial Funding Loan will
be secured by a first priority lien against all proceeds
derived from the Actions, the General Trust Accounts, and any
and all cash held in the General Trust Accounts, in accordance
with the terms of the Secured Credit Agreement until the loan
under the Secured Credit Agreement is repaid in full.
From the Effective Date forward, the Litigation Trustee may
seek from MASI additional funding as directed or approved by
the Oversight Committee. MASI may provide additional funding
subject to mutually acceptable documentation and the approval
of its Board of Directors. If MASI is unable or not permitted
to provide additional funding, the Litigation Trustee may
obtain the additional funding from other sources as directed
or approved by the Oversight Committee. The additional
funding will be in accordance with the terms of the Secured
Credit Agreement until the loan under the Secured Credit
Agreement is repaid in full.
Ocean Ridge Capital Advisors, LLC, will serve as Litigation
Trustee.
The members of the Oversight Committee and the Litigation
Trustee share a joint interest in the successful prosecution
of the Actions. The parties' entry into an arrangement to
share information based upon their joint interest will be
deemed sufficient to preserve and protect privilege.
A full-text copy of the Litigation Trust Agreement is
available for free at http://ResearchArchives.com/t/s?15fc
8. Warrant, a full-text copy of the Warrant is available for free
at http://ResearchArchives.com/t/s?15fd
9. New Notes Term Sheet, a full-text copy of which is available
for free at http://ResearchArchives.com/t/s?15fe
10. Shareholders Agreement, a full-text copy of which is
available for free at http://ResearchArchives.com/t/s?15ff
Headquartered in Dearborn, Mich., Meridian Automotive Systems,
Inc. -- http://www.meridianautosystems.com/-- supplies
technologically advanced front and rear end modules, lighting,
exterior composites, console modules, instrument panels and other
interior systems to automobile and truck manufacturers. Meridian
operates 22 plants in the United States, Canada and Mexico,
supplying Original Equipment Manufacturers and major Tier One
parts suppliers. The Company and its debtor-affiliates filed for
chapter 11 protection on April 26, 2005 (Bankr. D. Del. Case Nos.
05-11168 through 05-11176). James F. Conlan, Esq., Larry J.
Nyhan, Esq., Paul S. Caruso, Esq., and Bojan Guzina, Esq., at
Sidley Austin Brown & Wood LLP, and Robert S. Brady, Esq., Edmon
L. Morton, Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks,
Esq., at Young Conaway Stargatt & Taylor, LLP, represent the
Debtors in their restructuring efforts. Eric E. Sagerman, Esq.,
at Winston & Strawn LLP represents the Official Committee of
Unsecured Creditors. The Committee also hired Ian Connor
Bifferato, Esq., at Bifferato, Gentilotti, Biden & Balick, P.A.,
to prosecute an adversary proceeding against Meridian's First Lien
Lenders and Second Lien Lenders to invalidate their liens. When
the Debtors filed for protection from their creditors, they listed
$530 million in total assets and approximately $815 million in
total liabilities. (Meridian Bankruptcy News, Issue No. 44;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
MERIDIAN AUTOMOTIVE: Wants to Ink Deutsche Bank Commitment Letter
-----------------------------------------------------------------
Meridian Automotive Systems Inc. and its debtor-affiliates seek
authority from the U.S. Bankruptcy Court for the Western District
of Delaware to enter into, and perform all obligations under, a
Commitment Letter and Fee Letter from Deutsche Bank Trust Company
Americas, Deutsche Bank Securities Inc., and a group of lenders.
As a condition precedent to the effectiveness of the Fourth
Amended Joint Plan of Reorganization, the Debtors are required to
secure exit financing. To that end, the Debtors have kept in
continuous contact with potential exit lenders working towards
the goal of obtaining exit financing on the best terms available.
Accordingly, the result of the Debtors' concerted efforts is the
commitment from Deutsche Bank Trust Company Americas, Deutsche
Bank Securities, Inc., and a group of lenders, to provide exit
financing on, and subject to, the terms set forth in a Commitment
Letter and a Fee Letter, Edward J. Kosmowski, Esq., at Young
Conaway Stargatt & Taylor, LLP, in Wilmington, Delaware, informs
the Court.
The Deutsche Bank Exit Facility, aggregating no less than
$175,000,000, consists of four components:
(1) A $70,000,000 first-lien asset-based revolving credit
facility;
(2) An $80,000,000 first-lien term loan facility;
(3) A $25,000,000 first-lien pre-funded letter of credit
facility; and
(4) An uncommitted incremental asset-based revolving credit
facility up to an aggregate principal amount of
$30,000,000.
Reorganized Meridian will be the sole borrower under the Exit
Facility, and each Reorganized Debtor will guarantee Meridian's
obligations. The Exit Facility will be secured by substantially
all of the Reorganized Debtors' assets and will be subject to the
terms set forth in a First-Lien Intercreditor Agreement and a
Junior Lien Intercreditor Agreement, Mr. Kosmowski relates.
The ABL Facility and Incremental ABL Facility will mature five
years from the closing date of the Exit Facility. The First-Lien
Term Credit Facilities will mature six years from the closing
date of the Exit Facility.
The Commitment Letter provides that the Debtors will reimburse
Deutsche Bank for all reasonable and documented out-of-pocket
fees and expenses it incurs in connection with the Commitment
Letter and the Exit Facility.
In addition, the Debtors are required to indemnify and hold
harmless Deutsche Bank and the Exit Lenders from and against any
and all actions, claims, or liabilities that do not result from
Deutsche Bank's and the Exit Lenders' gross negligence or willful
misconduct.
The fees and expenses with regard to the preparation of the
Commitment Letter will constitute allowed administrative expenses
pursuant to Sections 507(a)(1 and 503(b) of the Bankruptcy Code,
regardless of whether or not the Exit Facility closes and funds
or definitive credit documents are executed, Mr. Kosmowski
clarifies. All amounts relating to indemnification provisions in
the Commitment Letter will not be limited by the Deutsche Bank
Work Fee as the term is defined in the Work Fee Letter.
A full-text copy of the Deutsche Bank Commitment Letter is
available for free at:
http://bankrupt.com/misc/Meridian_DB_CommitmentLetter.pdf
The Debtors subsequently notified the Court that they desire to
adjourn the Plan Confirmation Hearing from Nov. 29, 2006, to
Dec. 6, 2006.
As a result, the Debtors and Deutsche Bank agree to amend the
Commitment Letter to extend one of the commitment expiration
dates from Dec. 15, 2006, to Dec. 20, 2006.
Fee Letter
As part of the Exit Facility, the Debtors are obligated to pay to
Deutsche Bank certain non-refundable fees, which consist of
facility fees equal to a percentage of the total commitments
under the ABL Facility and First-Lien Term Credit Facilities, as
well as certain flat fees for the arrangement and the
administration of the Exit Facility.
Pursuant to the terms of a Fee Letter, the Debtors will pay
Deutsche Bank:
* approximately one-half of the Exit Facility Fees on the
first business day after the Court approves the Debtors'
request; and
* a non-refundable fee equal to 1 % of the total commitments
under the Exit Facility in the event the Debtors consummate,
at any time within one year of the Closing Date, an
alternative exit financing transaction other than with
Deutsche Bank.
The Debtors anticipate that the fees payable in connection with
the Exit Facility will not exceed $4,850,000.
Pursuant to the Fee Letter, Deutsche Bank has the ability, after
consultation with the Reorganized Debtors, to change the terms
and conditions, financial covenants, pricing, fees, and structure
of the Exit Facility if it determines that the changes are
necessary to ensure the successful syndication of the Facility.
The Debtors did not disclose the terms and fees associated with
the Exit Facility Fees. Mr. Kosmowski explains that the specific
terms are commercially sensitive and their public disclosure
would materially:
-- impact Deutsche Bank's ability to syndicate the Exit
Facility on economic terms advantageous to the Debtors; and
-- impair Deutsche Bank's ability to compete for future exit
financing opportunities.
Mr. Kosmowski assures the Court that the fees and terms are
consistent with fees charged in connection with financings of
similar type and nature.
The Debtors have sufficient liquidity to pay the fees under the
Commitment Letter and Fee Letter due on the Approval Date,
totaling approximately $2,350,000, without having to close on the
Exit Facility, Mr. Kosmowski avers.
The exit financing is necessary to allow the Debtors to make
distributions under the Plan, and to fund their ongoing
operations upon their emergence from Chapter 11, Mr. Kosmowski
asserts.
Mr. Kosmowski notes that Deutsche Bank's willingness and
commitments with respect to the Committed Credit Facilities will
terminate on the first to occur of:
(i) Nov. 29, 2006, unless on or prior to that date the
Court has approved the Debtors' entry into the Commitment
Letter and the Fee Letter;
(ii) Dec. 15, 2006, unless on or prior to that date the
Court has entered a Confirmation Order in a form and
substance satisfactory to Deutsche Bank, and the Court has
authorized the Debtors' performance of their obligations
under it; or
(iii) Jan. 31, 2007, unless on or prior to that date the
Transaction has been consummated, the Effective Date of
the Plan has occurred and a definitive credit agreement
and all related documentation evidencing each of the
First-Lien Term Loan Facility, the ABL Facility, the
Incremental ABL Facility and the First-Lien Pre-Funded L/C
Facility, in each case in form and substance satisfactory
to Deutsche Bank, will have been entered into and the
initial borrowings will have occurred.
Headquartered in Dearborn, Mich., Meridian Automotive Systems,
Inc. -- http://www.meridianautosystems.com/-- supplies
technologically advanced front and rear end modules, lighting,
exterior composites, console modules, instrument panels and other
interior systems to automobile and truck manufacturers. Meridian
operates 22 plants in the United States, Canada and Mexico,
supplying Original Equipment Manufacturers and major Tier One
parts suppliers. The Company and its debtor-affiliates filed for
chapter 11 protection on April 26, 2005 (Bankr. D. Del. Case Nos.
05-11168 through 05-11176). James F. Conlan, Esq., Larry J.
Nyhan, Esq., Paul S. Caruso, Esq., and Bojan Guzina, Esq., at
Sidley Austin Brown & Wood LLP, and Robert S. Brady, Esq., Edmon
L. Morton, Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks,
Esq., at Young Conaway Stargatt & Taylor, LLP, represent the
Debtors in their restructuring efforts. Eric E. Sagerman, Esq.,
at Winston & Strawn LLP represents the Official Committee of
Unsecured Creditors. The Committee also hired Ian Connor
Bifferato, Esq., at Bifferato, Gentilotti, Biden & Balick, P.A.,
to prosecute an adversary proceeding against Meridian's First Lien
Lenders and Second Lien Lenders to invalidate their liens. When
the Debtors filed for protection from their creditors, they listed
$530 million in total assets and approximately $815 million in
total liabilities. (Meridian Bankruptcy News, Issue No. 44;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
METROLOGIC INSTRUMENTS: Moody's Junks Proposed $75MM Credit Rating
------------------------------------------------------------------
Moody's Investors Service assigned a B2 corporate family rating to
Metrologic Instruments Inc. At the same time, Moody's assigned a
B1 rating to the proposed 1st lien senior secured credit facility
and a Caa1 rating to the proposed $75 million 2nd lien senior
secured credit facility.
The ratings for the two senior secured facilities reflect both the
overall probability of default of the company, to which Moody's
assigns a PDR of B2, and a loss given default of LGD 3 for the
first lien and LGD 5 for the second lien.
The rating outlook is stable.
Proceeds from the new credit facility together with an equity
contribution of preferred and common stock and cash on hand will
be used to fund the roughly $475 million acquisition of Metrologic
by Francisco Partners and to refinance Metrologic's existing debt.
Metrologic's ratings are constrained by the high debt levels that
are being assumed to fund the leverage recapitalization, the
recent sale of Adaptive Optics Associates, Inc., which represented
approximately 15% of the company's revenue in 2005, modest scale,
and ongoing litigation issues.
The ratings are also constrained by the company's limited
financial flexibility as all assets are secured by both the first
and second lien.
Metrologic's credit profile benefits from its customer and
geographic diversification, it's strong, albeit softening,
operating margins and increasing market share. The ratings are
also supported by the company's history of organic growth, low
cost manufacturing position and modest capital requirements.
The B1 rating of the first lien senior secured credit facility
reflects an LGD 3 loss given default assessment as this facility
is secured by a pledge of all of the company's assets and there is
a significant amount of second lien debt below it.
The Caa1 rating of the second lien reflects an LGD 5 loss given
default assessment given that it is contractually subordinated to
the first lien. Both the first lien and second lien benefit from
the full guarantees of existing and future domestic subsidiaries
and 2/3 stock pledge of foreign subsidiaries.
The final credit agreement is anticipated to contain customary
limitations, an excess cash flow sweep varying from none to 50%
and financial covenants governing maximum leverage and minimum
interest coverage. The final credit agreement is also expected to
restrict additional indebtedness, dividends, investments, liens,
asset sales, affiliate transactions, and mergers and acquisitions.
The ratings assume covenant levels for the first lien facilities,
when finalized, will give the company appropriate covenant leeway.
The stable outlook reflects Moody's expectation that Francisco
Partners views the preferred stock akin to common equity and that
it has no intention of redeeming the preferred stock prior to the
maturity of both the first and second lien facilities; the
preferred stock hybrid instrument is analytically viewed by
Moody's as 50% debt like and 50% equity like as the instrument has
no stated maturity, but is redeemable upon certain events
occurring.
The outlook also reflects Moody's belief that the merged company
will continue to generate operating margins supportive of the
ratings and will generate growth in sales and free cash flow
through new product introductions, penetration of new markets, low
cost manufacturing position, and working capital control.
The stable outlook also assumes that the company's financial
leverage, as measured by adjusted debt/EBITDA, will improve
steadily from the current pro-forma 7.8x for the LTM ended Sept.
2006 in the medium term and that the company will sustain strong
operating margins even if the ongoing legal disputes linger.
These ratings were assigned:
-- Corporate Family Rating, rated B2;
-- Probability of default rating, rated B2;
-- $35 Million Revolving Credit Facility, rated B1, LGD3, 33%;
-- $175 Million Senior Secured First Lien Term Loan, rated B1,
LGD3, 33%;
-- $75 Million Senior Secured Second Lien Term Loan, rated
Caa1, LGD5, 84%;
Headquartered in Blackwood, New Jersey, Metrologic Instruments,
Inc. is a global supplier for data capture and collection
hardware, and image processing software. The company had LTM
Sept. 2006 revenues of approximately $210 million.
MUSICLAND HOLDING: Panel's Claim Filing Period Extended to Jan. 31
------------------------------------------------------------------
In a stipulation approved by the U.S. Bankruptcy Court for the
Southern District of New York, Musicland Holding Corp., its
debtor-affiliates, Informal Committee of Secured Trade Vendors,
and the Official Committee of Unsecured Creditors agree to extend
the Creditors Committee's time to file the DIP Secured Trade
Creditors' Claims against the current members of the Informal
Committee to and including the earlier of:
(i) the effective date under the Plan; or
(ii) January 31, 2007.
The Creditors Committee reserves its right to seek an order
permitting the examination of the Secured Trade Creditors,
provided that the rights of the Informal Committee to object to
any examination of its members are reserved.
The Creditors Committee previously sought an order, pursuant to
Rules 2004 and 9016 of the Federal Rules of Bankruptcy Procedure,
authorizing examinations of and production of documents from
various entities.
In February 2006, the Court approved the DIP Motion, which
provided the Committee with 60 days from the date of appointment
of the Committee's counsel to file any claim against the Secured
Trade Creditors.
On March 8, 2006, the Court approved the Creditors Committee's
Rule 2004 Application provided that the Secured Trade Creditors
had until March 10, 2006, to object to the 2004 Application, and
that any examination of the Secured Trade Creditors would not
commence until further Court order.
On March 9, 2006, the Trade Vendors Committee objected to the 2004
Application.
The Informal Committee represents that its current members are:
* Bond Street Capital, LLC,
* Buena Vista Home Entertainment, Inc.,
* Cargill Financial Services International, Inc.,
* Credit Suisse International,
* Hain Capital Group, LLC,
* Metro-Goldwyn-Mayer Home Entertainment, LLC,
* Varde Investment Partners, L.P., and
* Warner Home Video Inc.
Headquartered in New York, New York, Musicland Holding Corp., is a
specialty retailer of music, movies and entertainment-related
products. The Debtor and 14 of its affiliates filed for chapter
11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No.
06-10064). James H.M. Sprayregen, Esq., at Kirkland & Ellis,
represents the Debtors in their restructuring efforts. Mark T.
Power, Esq., at Hahn & Hessen LLP, represents the Official
Committee of Unsecured Creditors. When the Debtors filed for
protection from their creditors, they estimated more than $100
million in assets and debts. (Musicland Bankruptcy News, Issue
No. 23; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
NEW YORK IDA: Operating Deficit Cues S&P 'BB+' S. 1998 Bond Rating
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on New York
City Industrial Development Agency's series 1998 bonds, issued
for Vaughn College of Aeronautics and Technology, to 'BB+' from
'BBB-', reflecting enrollment declines and increased operating
deficits.
Standard & Poor's also assigned its 'BB+' rating to the agency's
series 2006A and B bonds, issued for Vaughn College. The outlook
is stable.
"Despite the rating downgrade, we expect that Vaughn College will
exhibit growing enrollment with the completion of its new
residence hall, and return to break-even financial operations and
a lower endowment spending rate," said Standard & Poor's credit
analyst Gwendolyn Shufro.
The 'BB+' rating specifically reflects:
-- Vaughn College's substantial operating deficits for the
past 10 years;
-- endowment spending rate well above industry norms;
-- high dependency on tuition and fees;
-- decrease in enrollment; and,
-- an increase in debt to $39 million from $19 million, and
an increased annual debt service burden of more than 13%.
However, a high speculative-grade rating is still warranted due to
Vaughn College's adequate levels of unrestricted resources,
although significantly reduced in the past five years; and planned
increase in demand due to construction of a new residence hall and
increased academic offerings in aviation management and
engineering.
The series 2006A and B bonds will be used to construct a new
residence hall and to refund the existing 1998 series bonds. The
lowered rating affects about $20.5 million in rated debt.
OFFICEMAX INC: Earns $31.4 Million in 2006 Third Quarter
--------------------------------------------------------
OfficeMax Inc. reported a $31.4 million net income on
$2.24 billion of sales for the third quarter ended Sept. 30,
2006, compared with a $3.9 million net loss on $2.29 billion
of sales for the same period in 2005.
For the third quarter of 2006, net income before special items
was $43.2 million compared with net income before special items
of $9.9 million, in the third quarter of 2005.
At Sept. 30, 2006, the OfficeMax Inc.'s balance sheet showed
$6.18 billion in total assets, $4.29 billion in total liabilities,
$27.6 million in minority interest, and $1.87 billion in total
stockholders' equity.
"We are pleased with our third quarter results," said Sam Duncan,
Chairman and Chief Executive Officer of OfficeMax. "In both our
Contract and Retail segments, we continued to execute our
turnaround plan objectives to deliver substantial operating income
margin growth."
During the third quarter of 2006, OfficeMax generated $188.8
million in cash from operations and used $49.8 million for capital
expenditures. For the first nine months of 2006, OfficeMax
generated $339.8 million in cash from operations and used $96.8
million for capital expenditures. At Sept. 30, 2006, net debt, or
total debt excluding the timber securitization notes less cash and
cash equivalents and restricted investments, was $74.0 million.
During the third quarter of 2006, OfficeMax opened 10 new retail
stores, ending the quarter with 884 retail stores compared with
955 stores at the end of the third quarter of 2005.
Financial Outlook
OfficeMax currently expects full year 2006 operating income margin
to be in the middle of the previously-announced range of 3% to
3.5%, excluding special items. Special items, including charges
for retail store closures, the Contract segment reorganization and
the company's headquarters consolidation, are expected to reduce
operating income margin by approximately 1.5% for the full year
2006.
Headquartered in Itasca, Illinois, OfficeMax(R) Incorporated
(NYSE: OMX) -- http://www.officemax.com/-- provides office
supplies and paper, print and document services, technology
products and solutions, and furniture to consumers and to large,
medium and small businesses. OfficeMax customers are served by
approximately 35,000 associates through direct sales, catalogs,
Internet and approximately 880 superstores.
* * *
As reported in the Troubled Company Reporter on Oct. 30, 2006,
Moody's Investors Service affirmed its Ba2 Corporate Family Rating
for OfficeMax Inc., in connection with the implementation of its
new Probability-of-default ratings and Loss-Given-Default rating
methodology for the U.S. and Canadian retail sector.
Additionally, Moody's also revised its probability-of-default
rating on the company's 7.5% Notes due 2008 from Ba2 to Ba3.
As reported in the Troubled Company Reporter on Sept. 25, 2006,
Standard & Poor's Ratings Services affirmed the B+ Corporate
Credit Rating on OfficeMax Inc. S&P also revised the outlook to
Stable from Negative.
OWENS CORNING: Inks Stipulation Settling Wausau Insurance Claims
----------------------------------------------------------------
Owens Corning and its debtor-affiliate, Fibreboard Corporation,
have entered into a stipulation with Employers Insurance Company
of Wausau aka Wausau Insurance Company, settling Wausau's
insurance policy claims against Fibreboard.
Wausau had issued workers' compensation insurance policies
for the benefit of Fibreboard Corp. from Aug. 15, 1996, through
Sept. 1, 1997.
The Policies relate to workers' compensation claims and include
audit and retrospective adjustment provisions whereby, subject to
the terms of specific insurance coverage, the premium is
determined retrospectively on the basis of, among other things,
actual loss experience, claims paid and supplementary costs
incurred.
On Jan. 12, 2001, Wausau filed its proof of claim against
Fibreboard on account of the its obligations under the
Policies. During the course of Fibreboard's bankruptcy case,
Wausau conducted retrospective adjustments pursuant to the terms
of the Policies. Wausau periodically updated and amended the
Wausau Claims to reflect the adjustments.
In April 2006, the Debtors asked the Court to disallow Wausau's
Claim. In response, Wausau provided the Debtors with all
previous billings, which supported the then-liquidated portion of
the Wausau Claim and the actuarial analysis of the unliquidated
portion of the Wausau Claim.
After arm's-length negotiations, the parties agreed to resolve
their dispute over the Claim. The Debtors agree to pay Wausau
$640,136 as settlement payment in full satisfaction of all amounts
owing under the terms of the Policies prior to June 30, 2006.
The parties' rights under the Policies or any agreements will
remain in full force and effect. Wausau will continue to
administer, handle and pay claims subject to the terms of the
Policies without Court approval. Wausau will invoice the Debtors
with respect to its services in handling the claims. The Debtors
will pay Wausau's services in the ordinary course of business and
pursuant to the terms of the Policies.
The parties reserve their rights with respect to Wausau's
unliquidated and contingent amounts, and agree that those amounts
will not discharged, released or enjoined under the terms of the
Debtors' Sixth Amended Joint Plan of Reorganization.
The Debtors agree to perform their obligations under the
Policies, including the duty to cooperate with Wausau in the
defense of claims and the obligation to pay additional
retrospective premiums and related charges.
About Owens Corning
Owens Corning (OTC: OWENQ.OB) -- http://www.owenscorning.com/--
manufactures fiberglass insulation, roofing materials, vinyl
windows and siding, patio doors, rain gutters and downspouts.
Headquartered in Toledo, Ohio, the Company filed for chapter 11
protection on Oct. 5, 2000 (Bankr. Del. Case. No. 00-03837).
Norman L. Pernick, Esq., at Saul Ewing LLP, represents the
Debtors. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered,
represents the Official Committee of Asbestos Creditors. James J.
McMonagle serves as the Legal Representative for Future Claimants
and is represented by Edmund M. Emrich, Esq., at Kaye Scholer LLP.
(Owens Corning Bankruptcy News, Issue No. 147; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
OWENS CORNING: Investors Report Ownership Of Owens Corning Stock
-----------------------------------------------------------------
In separate regulatory filings with the Securities and Exchange
Commission, six investor groups disclose their acquisition of
shares of Reorganized Owens Corning's common stock par value at
$0.01 per share:
(1) D. E. Shaw Laminar Portfolios, L.L.C.; D. E. Shaw Oculus
Portfolios, L.L.C.; D. E. Shaw & Co., L.P., D. E. Shaw &
Co., L.L.C.; and David E. Shaw;
(2) MatlinPatterson Global Opportunities Partners II L.P.;
MatlinPatterson Global Opportunities Partners (Cayman) II
L.P.; MatlinPatterson Global Advisers LLC; MatlinPatterson
Global Partners II LLC; MatlinPatterson Asset Management
LLC; MatlinPatterson LLC; and David J. Matlin and Mark R.
Patterson;
(3) King Street Capital, L.P.; King Street Capital, Ltd.; King
Street Advisors, L.L.C.; King Street Capital Management,
L.L.C.; O. Francis Biondi, Jr.; and Brian J. Higgins;
(4) Harbinger Capital Partners Master Fund I, Ltd.; Harbinger
Capital Partners Offshore Manager, L.L.C.; HMC Investors,
L.L.C.; Harbert Management Corporation; Philip Falcone;
Raymond J. Harbert; and Michael D. Luce;
(5) Highland Credit Strategies Fund; Prospect Street High
Income Portfolio; Prospect Street Income Shares; Highland
Capital Management, L.P.; Strand Advisors, Inc.; and James
D. Dondero; and
(6) Quadrangle Debt Recovery Advisors LLC; Michael Weinstock;
Andrew Herenstein; Christopher Santana; and Josiah
Rotenberg.
Laminar, et al.
Pursuant to Owens Corning's Sixth Amended Joint Plan of
Reorganization, Laminar received in respect of its claim arising
from ownership of certain nonconvertible bonds:
(i) a certain amount of cash;
(ii) 3,070,071 shares of Common Stock; and
(iii) the right to participate in a rights offering.
Eric Wepsic, Laminar's managing director, relates that Laminar
did not exercise its right to purchase Common Stock in the Rights
Offering. However, J.P. Morgan Securities, Inc., agreed to
purchase pursuant to an equity commitment agreement any shares of
Common Stock not purchased by the eligible offerees.
Laminar and D. E. Shaw Oculus Portfolios, L.L.C., along with
other parties, in turn entered into a syndication agreement
pursuant to which Laminar, Oculus, and the other parties were
obligated to purchase their pro rata portions of the shares that
JPMorgan Securities agreed to purchase pursuant to the Equity
Commitment Agreement.
On October 31, Laminar purchased 11,204,663 shares of Common
Stock and Oculus purchased 4,801,999 shares of Common Stock in
connection with the Syndication Agreement.
Laminar, as a holder of certain subordinated claims of Owens
Corning, also received Series A Warrants to purchase 984,815
shares of Common Stock at an exercise price of $43 per share.
Laminar, as a holder of the common stock of Owens Corning's
predecessor, received Series B Warrants to purchase 311,085
shares of Common Stock at an exercise price of $45.25 per share.
The Warrants became exercisable on October 31, 2006, and will
expire on October 31, 2013.
Laminar also entered into a Collar Agreement pursuant to which it
agreed to purchase shares of Common Stock under certain
circumstances from a trust set up to receive payments on behalf
of asbestos personal injury claimants.
The collar transactions involve:
(i) a short put option obligating Laminar at the request of
the Asbestos Trust to purchase from the Asbestos Trust
6,447,188 shares of Common Stock between Jan. 1, 2007,
and April 1, 2007, at $25 per share; and
(ii) a long call option providing Laminar with the right to
purchase 6,447,188 shares of Common Stock between
Jan. 1, 2007, and Jan. 1, 2008 at $37.50 per share.
The Collar Agreement provides that only one, not both, of the
Options can be exercised.
The 22,017,822 shares of Common Stock beneficially owned by
Laminar represent approximately 19.8% of the outstanding shares
of Common Stock, including:
-- the 1,295,900 shares of Common Stock issuable upon exercise
of the Warrants; and
-- the 6,447,188 shares of Common Stock obtainable pursuant to
the Collar Agreement.
The 4,801,999 shares of Common Stock beneficially owned by Oculus
represent approximately 4.7% of the 103,200,000 shares of Common
Stock issued and outstanding as of Oct. 31, 2006.
A full-text copy of Laminar's Schedule 13D filing is available
for free at http://researcharchives.com/t/s?15df
MatlinPatterson, et al.
Pursuant to the Plan, MatlinPatterson acquired beneficial
ownership of 778,722 shares of Common Stock in consideration of
the cancellation of certain debt instruments, which the fund
manager acquired through a series of market purchases.
MatlinPatterson sold 256,600 shares of Common Stock on Oct. 31,
2006, for aggregate proceeds of approximately $6,900,000. The
remaining 522,122 shares are the only shares of Common Stock,
which are currently beneficially owned by MatlinPatterson.
MatlinPatterson, through its subsidiaries PI SPE LLC and PI SPE
CI LLC, completed transactions with JPMorgan Securities, as
assignee under a Syndication Agreement, dated as of May 10, 2006,
and a Purchase Agreement, dated as of August 31, 2006.
The Syndication Agreement and the Purchase Agreement were
executed for the purpose of syndicating JPMorgan Securities'
obligations to purchase Common Stock from Owens Corning under the
Equity Commitment Agreement. The transactions covered an
aggregate of 9,331,957 shares of Common Stock.
PI SPE and MatlinPatterson collectively paid an aggregate of
approximately $248,000,000, pursuant to the Syndication Agreement
and the Purchase Agreement, and to acquire the Debt Instruments.
Together, the Plan Shares and the Private Shares would constitute
approximately 9.55% of Owens Corning's outstanding Common Stock.
A full-text copy of MatlinPatterson's Schedule 13D filing is
available for free at http://researcharchives.com/t/s?15e0
King Street, et al.
King Street reports that it holds in the aggregate 6,249,535
shares or 5.9% of Owens Corning Common Stock as of Nov. 10,
2006.
Pursuant to the Plan, King Street received a distribution of
Owens Corning shares on account of its allowed claims with
respect to certain debt securities.
King Street also acquired additional shares from JPMorgan
Securities, pursuant to the Syndication Agreement. KSC L.P. and
KSC Ltd., also have call options relating to Common Stock.
The Owens Corning shares are held in these King Street
affiliates:
King Street Number of Shares Percentage of
Affiliate Beneficially Own Stock Owned
----------- ---------------- -------------
KSC, L.P. 1,975,312 1.9%
KSA, L.L.C. 1,975,312 1.9%
KSC, Ltd. 4,274,223 4.1%
KSCM, L.L.C. 6,249,535 5.9%
Francis Biondi, Jr. 6,249,535 5.9%
Brian J. Higgins 6,249,535 5.9%
A full-text copy of King Street's Schedule 13G filing is
available for free at http://researcharchives.com/t/s?15e1
Harbinger, et al.
Harbinger discloses that it holds in the aggregate 17,843,761
shares or 15.7% of Owens Corning Common Stock as of Nov. 13,
2006.
Joel B. Piassick, Harbinger's managing member, relates that
Harbinger's affiliates beneficially own these Owens Corning
shares:
Harbinger Number of Shares Percentage of
Affiliate Beneficially Own Stock Owned
--------- ---------------- -------------
Harbinger Master Fund 16,166,137 14.5%
Offshore Manager 16,166,137 14.5%
HMC Investors, L.L.C. 16,166,137 14.5%
Harbert Management Corp. 17,843,761 15.7%
Philip Falcone 17,843,761 15.7%
Raymond J. Harbert 17,843,761 15.7%
Michael D. Luce 17,843,761 15.7%
Mr. Piassick says Harbinger, et al., have shared power to vote
or to direct the vote, and to dispose of or to direct the
disposition of, the Shares.
A full-text copy of Harbinger's Schedule 13G filing is available
for free at http://researcharchives.com/t/s?15e2
Highland, et al.
Highland reports that it beneficially owns in the aggregate
8,704,240 shares or 8.43% of Reorganized Owens Corning's Common
Stock as of November 15, 2006.
James Dondero, Highland's president, says the Owens Corning
shares are held by:
Highland Number of Shares Percentage of
Affiliate Beneficially Own Stock Owned
--------- ---------------- -------------
Capital Management 8,704,240 8.43%
Strand 8,704,240 8.43%
Credit Strategies Fund 177,509 0.17%
PHY 19,723 0.02%
CNN 19,723 0.02%
A full-text copy of Highland's Schedule 13G filing is available
for free at http://researcharchives.com/t/s?15e3
Quadrangle, et al.
Quadrangle holds 5,485,232 or 5.3% of Reorganized Owens Corning
Common Stock as of Nov. 7, 2006, the investment fund manager
reports.
Quadrangle discloses that the shares are held by:
Quadrangle Number of Shares Percentage of
Affiliate Beneficially Own Stock Owned
--------- ---------------- -------------
Quadrangle Advisors 5,485,232 5.3%
Michael Weinstock 5,485,232 5.3%
Andrew Herenstein 5,485,232 5.3%
Christopher Santana 5,485,232 5.3%
Josiah Rotenberg 5,485,232 5.3%
A full-text copy of Quadrangle's Schedule 13G filing is available
for free at http://researcharchives.com/t/s?15e4
About Owens Corning
Owens Corning (OTC: OWENQ.OB) -- http://www.owenscorning.com/--
manufactures fiberglass insulation, roofing materials, vinyl
windows and siding, patio doors, rain gutters and downspouts.
Headquartered in Toledo, Ohio, the Company filed for chapter 11
protection on Oct. 5, 2000 (Bankr. Del. Case. No. 00-03837).
Norman L. Pernick, Esq., at Saul Ewing LLP, represents the
Debtors. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered,
represents the Official Committee of Asbestos Creditors. James J.
McMonagle serves as the Legal Representative for Future Claimants
and is represented by Edmund M. Emrich, Esq., at Kaye Scholer LLP.
(Owens Corning Bankruptcy News, Issue No. 147; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
PERFORMANCE TRANSPORTATION: Hires PwC as Restructuring Tax Advisor
------------------------------------------------------------------
The Honorable Michael J. Kaplan of the United States Bankruptcy
Court for the Western District of New York approved Performance
Transportation Services Inc. and its debtor-affiliates'
application to employ PricewaterhouseCoopers LLP as their
restructuring tax advisor, effective as of Oct. 8, 2006.
As reported in the Troubled Company Reporter on Nov. 16, 2006, PwC
will:
(a) determine the:
* amount of the Debtors' cancellation of indebtedness
income;
* the Debtors' stock basis; and
* the tax basis of Debtor-owned assets; and
(b) identify federal and state tax attributes and any
limitations imposed on those attributes for the Debtors.
PwC's professionals will be paid at their customary hourly rates,
which are subject to periodic adjustments:
Position Rate
-------- ----
Partners $740
Directors $600
Managers $490
Senior Associates $395
Headquartered in Wayne, Michigan, Performance Transportation
Services, Inc. -- http://www.pts-inc.biz/-- is the second largest
transporter of new automobiles, sport-utility vehicles and light
trucks in North America. The Company provides transit stability,
cargo damage elimination and proactive customer relations that are
second to none in the finished vehicle market segment. The
company's chapter 11 case is administered jointly under Leaseway
Motorcar Transport Company.
Headquartered in Niagara Falls, New York, Leaseway Motorcar
Transport Company Debtor and 13 affiliates filed for chapter 11
protection on Jan. 25, 2006 (Bankr. W.D.N.Y. Case No. 06-00107).
James A. Stempel, Esq., James W. Kapp, III, Esq., and Jocelyn A.
Hirsch, Esq., at Kirkland & Ellis, LLP, and Garry M. Graber, Esq.,
at Hodgson Russ LLP represent the Debtors in their restructuring
efforts. David Neier, Esq., at Winston & Strawn LLP, represents
the Official Committee of Unsecured Creditors. When the Debtors
filed for protection from their creditors, they estimated assets
between $10 million and $50 million and more than $100 million in
debts. (Performance Bankruptcy News, Issue No. 18; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
PRUDENTIAL ASSURANCE: Confirms Final Implementation of Scheme
-------------------------------------------------------------
The final implementation of the solvent scheme of arrangement
made between The Prudential Assurance Co. Ltd. and its
respective scheme creditors occurred on Oct. 31.
The Scheme Manager, Whittington Insurance Services Ltd.
confirmed that all scheme liabilities were settled or otherwise
determined and all established liabilities were paid in full in
accordance with the terms of the solvent scheme, pursuant to
section 425 of the Companies Act 1985.
The High Court of Justice in England and Wales sanctioned the
solvent scheme on July 9, 2004.
The Scheme Manager can be reached at:
Whittington Insurance Services Ltd.
c/o John Leppard
33 Creechurch Lane
London EC3A 5EB
United Kingdom
Tel: +44 (0) 207 220 1851
Fax: +44 (0) 207 929 1315
About Prudential Assurance
Headquartered in London, England, Prudental Assurance Company Ltd.
-- http://www.prudential.co.uk/-- is an insurance company
authorized to conduct general business within U.K. Omni
Whittington Insurance Services Limited, as Foreign Representative
of The Prudential Assurance Company Limited, Pearl Assurance PLC,
Elders Insurance Company Ltd., Hiscox Insurance Limited, and The
World Marine and General Insurance PLC, filed a Section 304
Petition on July 22, 2004 (Bankr. S.D.N.Y. Case Nos. 04-14884
through 04-14888, inclusive). Karen Ostad, Esq., and Dina
Gielchinsky, Esq., at Lovells represent the Foreign
Representative. The Section 304 Petitions indicate that the
insurers have more than $100 million in assets and debts.
Q.D. MT. AETNA: Case Summary & 12 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Q.D. Mt. Aetna, LLC
7 West Ridgely Road, Suite 100
Lutherville Timonium, MD 21093
Bankruptcy Case No.: 06-17561
Type of Business: The Debtor is an affiliate of Chesapeake
Village, LLC, which filed for chapter 11
protection on Aug. 24, 2006 (Bankr. D. Md.
Case No. 06-15094).
Chapter 11 Petition Date: November 27, 2006
Court: District of Maryland (Baltimore)
Debtor's Counsel: Ronald J. Drescher, Esq.
Drescher & Associates
4 Reservoir Circle, Suite 107
Baltimore, MD 21208
Tel: (410)484-9000
Tel: (410)484-8120
Total Assets: $0
Total Debts: $ 23,953,683
Debtor's 12 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Mercantile Safe Deposit & 220 acres +/- of $12,605,652
Trust unimproved land
Two Hopkins Plaza located in Hagerstown,
Baltimore, MD 21202 Maryland.
Has property tax ID
number 18-023075 and
is generally known as
11110 Robinwood Drive.
Secured: Unknown
R.B. Young, LLLP 220 acres +/- of $5,800,000
c/o Varner L. Paddack unimproved land
P.O. Box 1825 located in Hagerstown,
Hagerstown, MD 21742 Maryland.
Has property tax ID
number 18-023075 and
is generally known as
11110 Robinwood Drive.
Secured: Unknown
Senior Lien:
$12,605,652
NVR, Inc. 220 acres +/- of $2,500,000
7939 Honeygo Boulevard unimproved land
Suite 100 located in Hagerstown,
Nottingham, MD 21236 Maryland.
Has property tax ID
number 18-023075 and
is generally known as
11110 Robinwood Drive.
Secured: Unknown
Senior Lien:
$18,405,652
TOUSA Homes, Inc. 220 acres +/- of $1,350,000
Technical Olympic USA, Inc. unimproved land
555 Quince Orchard Road located in Hagerstown,
Suite 530 Maryland.
Gaithersburg, MD 20878 Has property tax ID
number 18-023075 and
is generally known as
11110 Robinwood Drive.
Secured: Unknown
Senior Lien:
$22,105,652
Anne Louise Perlow 220 acres +/- of $1,200,000
1829 Reisterstown Road unimproved land
Suite 380 located in Hagerstown,
Pikeville, MD 21208 Maryland.
Has property tax ID
number 18-023075 and
is generally known as
11110 Robinwood Drive.
Secured: Unknown
Senior Lien:
$20,905,652
Quillen Development, Inc. $300,000
7 West Ridgely Road
Suite 100
Lutherville Timonium, MD
21093
Bowman Consulting Group Ltd. 220 acres +/- of $180,000
3836 Centerview Drive unimproved land
Suite 300 located in Hagerstown,
Chantilly, VA 20151 Maryland.
Has property tax ID
number 18-023075 and
is generally known as
11110 Robinwood Drive.
Secured: Unknown
Senior Lien:
$23,455,652
C.J. Johnston, Inc. $10,000
9500 Amberly Lane
Perry Hall, MD 21128
The Hartford Insurance $4,000
Commercial Billing
P.O. Box 620
New Hartford, NY 13413
Miller, Oliver, Baker, Moyla $3,501
28 West Washington
Hagerstown, MD 21740
Erie Insurance Group $500
100 Erie Insurance Plaza
Erie, PA 16530-1104
Washington County $30
Dept./Budget & Finance
100 West Washington Street
Hagerstown, MD 21740
RADNOR HOLDINGS: Sells Substantially All Assets to TR Acquisition
-----------------------------------------------------------------
The Honorable Peter J. Walsh of the U.S. Bankruptcy Court for
the District of Delaware approved the sale of substantially all
of Radnor Holdings Corp. and its debtor-affiliates' assets to
TR Acquisition Co. Inc. for a credit bid of $95 million.
The asset sale was free and clear of all liens, claims, interests,
and encumbrances.
TR Acquisition is an affiliate of Tennenbaum Capital Partners LLC,
the Debtors' prepetition term loan lender.
Judge Walsh directed TR Acquisition to pay the fees retained by
the Official Committee of Unsecured Creditors for the:
-- investigation contemplated by paragraph 24(a) of the Final
DIP Order in an aggregate amount of $200,000; and
-- investigation contemplated by paragraph 23(a) of the Final
DIP Order in an amount not to exceed $100,000.
TR Acquisition will also pay the U.S. Trustee's fees.
Full-text copies of the Asset Sale Order and Amended and
Restated Asset Purchase Agreement are available for free at
http://ResearchArchives.com/t/s?15eb
About Radnor Holdings
Headquartered in Radnor, Pennsylvania, Radnor Holdings Corporation
-- http://www.radnorholdings.com/-- manufactures and distributes
a broad line of disposable food service products in the United
States, and specialty chemicals worldwide. The Debtor and its
affiliates filed for chapter 11 protection on Aug. 21, 2006
(Bankr. D. Del. Case No. 06-10894). Gregg M. Galardi, Esq., and
Mark L. Desgrosseilliers, Esq., at Skadden, Arps, Slate, Meagher,
represent the Debtors. Donald J. Detweiler, Esq., and Victoria
Watson Counihan, Esq., at Greenberg Traurig, LLP, serves the
Official Committee of Unsecured Creditors. When the Debtors filed
for protection from their creditors, they listed total assets of
$361,454,000 and total debts of $325,300,000.
REGENCY ENERGY: Moody's Rates Proposed Sr. Unsecured Notes at B2
----------------------------------------------------------------
Moody's Investors Service assigned a negative outlook to Regency
Energy Partners LP and a B2 rating on its proposed senior
unsecured notes.
The negative rating outlook reflects a weaker operating
performance outlook than what Moody's had previously reviewed,
compounded by a recent comparatively large leveraged acquisition
of underdeveloped assets.
Furthermore, the incremental interest expense from this debt
offering could constrain interest coverages in the near term,
while Regency has yet to demonstrate incremental cash flows it
forecasts from its new assets.
In conjunction with this refinancing and in accordance with the
Loss Given Default methodology, Moody's upgraded Regency Gas
Services LP's senior secured revolving credit facility to Ba1 from
B1. The Corporate Family Rating for the Regency organization is
unchanged at B1.
However, because the MLP will become the highest level debt-
issuing entity in the organization, Moody's assigned the B1 CFR to
Regency and withdrew the B1 CFR that had been assigned to the OLP.
The OLP's senior secured term loan remains at B1 pending its
retirement with the proceeds from the note issue. Moody's assigns
a PDR of B1 to reflect the overall probability of default of the
company and a loss given default of LGD 1 for the senior secured
revolving credit facility and LGD 4 to the new senior unsecured
notes.
This high-yield offering marks Regency debut in the debt capital
markets and its first debt issuance at the MLP level. The
company's debt capitalization currently comprises $850 million of
senior secured credit facilities at Regency Gas Services LP.
Proceeds from the new debt issue will be used to retire the OLP's
$600 million term loan and to repay $18 million of loans
outstanding on its $250 million revolver.
The upgrade of the OLP's first-lien senior secured revolving
credit facility to Ba1 from B1 is a function of it becoming senior
to a significant amount of junior debt when the MLP's senior
unsecured notes are issued. The secured credit facility is
assigned a loss given default assessment of LGD 1 as it is secured
by a pledge of all of the company's assets. The
B2 rating of the MLP unsecured notes reflects an LGD 4 loss given
default assessment given that they are effectively subordinated to
the operating subsidiaries' secured obligations.
Regency's subsidiaries, including the OLP, provide joint and
several upstream guarantees on a senior unsecured basis to the MLP
notes.
Moody's maintains a B1 CFR for Regency, reflecting a high level of
leverage relative to the commodity-price and volume sensitivity of
its gas gathering and processing business, the untested debt
capacity of its newly-acquired, underdeveloped TexStar assets, and
recurrent net losses. Regency's ratings are also restrained by
its short, transaction-prone operating history, ownership by a
private equity firm, and its MLP business model all which bode
event risk.
Moody's notes that Regency recently lowered its EBITDA guidance
for 2006 and 2007 using lower price assumptions that reflect a
softer price environment. The margins of its price-sensitive
gathering & processing segment accounts for most of the
underperformance, though its transportation segment is also
slightly off forecast.
It remains to be seen how successful Regency will be in generating
the margins and volumes it expects from TexStar. Regency acquired
TexStar three months ago from another affiliate of Hicks Muse, its
general partner sponsor.
The $360 million acquisition was the company's largest acquisition
to date, increasing its assets by about 40%. The consideration was
at a high multiple relative to $6 million of actual EBITDA that
this start-up operation generated in the last twelve months ended
6/30/06, according to the recently filed 8-K, and was prospective
of cash flows which could result from additional development as
well as full year's cash flows from TexStar's recent acquisitions
of the Como and Enbridge assets. The incremental debt will fully
leverage Regency and make it all the more vulnerable to negative
variances in margins and volumes.
Rating Outlook:
Regency could face further downward pressure on ratings over the
next 12 months if it fails to achieve operating results that were
expected when it acquired TexStar. A stable rating outlook is
subject to Regency demonstrating a ramp-up in volumes and EBITDA
in the coming quarters as it forecasts from the Regency Intrastate
Pipeline and the TexStar acquisition. The rating and outlook are
based on EBITDA/interest of roughly 3x and debt/EBITDA in the 4x
range. A substantially hedged position helps to support the
company's current rating level.
Rating actions:
* Regency Energy Partners LP
-- Probability-of-default rating B1;
-- Corporate Family Rating B1;
-- $650 million senior unsecured notes due December 2016 at
B2, LGD4, 65%;
* Regency Gas Services LP
-- Probability-of-default rating B2 withdrawn;
-- Corporate Family Rating B1 withdrawn;
-- $250 million senior secured revolver due Aug. 2011
upgraded to Ba1, LGD1, 9% from B1.
Headquartered in Dallas, Texas, Regency Energy Partners LP is a
publicly traded master limited partnership engaged in natural gas
gathering, processing, and transportation.
RITE AID: To Withdraw Pacific Stock Exchange Listing, Retains NYSE
------------------------------------------------------------------
Rite Aid Corporation plans to withdraw the listing of its common
stock from the former Pacific Stock Exchange, now NYSE Arca, Inc.
Rite Aid's common stock will continue to be listed on the New York
Stock Exchange .
Rite Aid has decided to withdraw its listing from NYSE Arca, Inc.
because of the duplicative services inherent in the dual listings
as a result of the NYSE Group's recent merger with Archipelago
Holdings, the parent company of NYSE Arca. The withdrawal is
expected to be effective within the next month.
Rite Aid believes that withdrawing its listing from NYSE Arca,
Inc. will not have any impact on the liquidity of its stock. NYSE
Arca will continue to trade Rite Aid common stock on an unlisted
trading privilege basis.
Headquartered in Camp Hill, Pennsylvania, Rite Aid Corporation
(NYSE, PCX: RAD) -- http://www.riteaid.com/-- runs a drugstore
chain with 2005 annual revenues of $17.3 billion and 3,320 stores
in 27 states and the District of Columbia.
* * *
As reported in the Troubled Company Reporter on Aug. 29, 2006,
Moody's Investors Service placed the ratings of Rite Aid
Corporation, including the corporate family rating of B2, on
review for possible downgrade.
These ratings include Corporate Family Rating at B2; Senior
secured global notes at B2; Senior secured guaranteed second lien
notes at B2; Senior unsecured debentures, notes, convertible
senior notes and global notes at Caa1; and Speculative grade
liquidity rating at SGL-3.
SATELITES MEXICANOS: First Amended Chapter Plan is Now Effective
----------------------------------------------------------------
Satelites Mexicanos, S.A. de C.V.'s First Amended Chapter 11 Plan
of Reorganization has become effective.
The Honorable Robert D. Drain of the U.S. Bankruptcy Court for the
Southern District of New York confirmed SATMEX's Amended Plan on
Oct. 26.
Creation of Equity Trust
As reported in the Troubled Company Reporter on Sept. 14, 2006,
the Debtor will form an Equity Trust, instead of special purpose
entities, to settle the Debtor's obligations under the Amended
Plan.
The New Common Stock representing 90% of the equity voting rights
and 96% of the equity financial rights in the Reorganized Debtor
will be held by an Equity Trust Trustee for the benefit of the
holders of Allowed Existing Bond Claims, Allowed Existing
Preferred Stock Interests, and Allowed Existing Common Stock
Interests, other than the Mexican Government on the Effective
Date.
The Equity Trust Trustee will deposit global trust certificates
representing beneficial ownership of New Common Stock
corresponding to 43% of the voting rights and 78% of the
financial rights in the Reorganized Debtor with the Depository
Trust Company, Euroclear Bank S.A./N.V., or Clearstream Banking
societe anonyme. Interests in the Global Trust Certificate will
be received by the holders of Existing Bond Claims on a pro rata
basis in exchange for a portion of the Existing Bond Claims.
Recovery for Servicios & Mexican Government
Servicios Corporativos Satelitales, S.A. de C.V., will receive
beneficial interests in the Equity Trust corresponding to New
Series A Common Stock representing 45% of the equity voting
rights and 16% of the equity financial rights in the Reorganized
Debtor, on a fully diluted basis.
The Mexican Government will receive New Series A Common Stock
and New Series N Common Stock representing 10% of the equity
voting rights and 4% of the equity financial rights in the
Reorganized Debtor subject to the same terms and conditions as
the New Common Stock held by the Equity Trust Trustee, on a
fully diluted basis.
Servicios is restructuring its debt obligations. The Debtor
relates that the Mexican Government, as creditor of Servicios,
will ultimately receive the economic benefits of the beneficial
interests in the Debtor distributed to Servicios under the Plan
in full satisfaction of Servicios' obligation to the Mexican
Government arising from a promissory note referred to as the
Menoscabo.
Servicios owed the Mexican Government approximately $125.1 million
plus interest in connection with Servicios' purchase of a stake in
the Debtor.
Servicios holds 70.71% equity stake and 100% voting interest in
the Debtor as of the date of filing for chapter 11 protection.
The Mexican Government holds 23.57% equity stake and limited
voting rights for extraordinary matters.
Recovery of Claims in Classes 2 & 6
For purposes of voting to accept or reject the Amended Plan, the
Class 2 Senior Secured Note Claims are allowed for
$203,388,000, in the aggregate. For purposes of distribution,
the Class 2 Senior Secured Note Claims are allowed for
$203,388,000 plus unpaid accrued interest through the
Effective Date, with interest calculated so that, assuming an
Effective Date of Sept. 30, 2006, the Allowed amount will be
$234,400,000.
With respect to Classes 6A and 6B Existing Preferred Stock
Interests, the Plan provides that:
(i) Principia S.A. de C.V., will receive beneficial interests
in the Equity Trust corresponding to New Series B Common
Stock and New Series N Common Stock, which will represent
0.67% of the total equity financial rights and 0.67% of
the total equity voting rights of the Reorganized Debtor
on a fully diluted basis; and
(ii) Loral Skynet Corp. and Loral SatMex, Ltd., will
receive beneficial interests in the Equity Trust
corresponding to New Series B Common Stock and New
Series N Common Stock, which will represent 1.33% of the
total equity financial rights and 1.33% of the total
equity voting rights of the Reorganized Debtor on a fully
diluted basis.
Issuance of Secured Notes
On the Plan Effective Date, the Reorganized Debtor will issue
$203,388,000 in First Priority Senior Secured Notes. The
First Priority Notes will mature five years after the Effective
Date and incur interest at one-month or three-month LIBOR plus
875 basis points per annum (LIBOR+8.75%), payable in arrears in
Cash on the last day of the applicable one-month or three-month
period.
The Reorganized Debtor will issue $140,000,000 in Second
Priority Senior Secured Notes, which will mature seven years
after the Effective Date. The Second Priority Notes will incur
interest payable quarterly in arrears at 10.125% per annum.
Interest will be payable in Cash, provided that until the
earlier of (a) the fifth anniversary of the Effective Date, and
(b) the date the First Priority Notes are paid in full, the
interest will be payable in kind.
Satmex to Pay Other Parties' Legal Fees
The Amended Plan provides that the Debtor will be entitled to
and will pay the reasonable fees and expenses of professionals
retained by:
* the Ad Hoc Senior Secured Noteholders' Committee;
* the Ad Hoc Existing Bondholders' Committee;
* Thomas Heather, the conciliador in the Concurso Proceeding
in Mexico;
* Loral; and
* Servicios.
Appointment of Common Representative
Pursuant to the Amended Plan, a common representative will be
irrevocably appointed under Mexican law to act for the benefit
of the holders of the Second Priority Notes solely for the
purposes of:
(i) voting in favor of or accepting a plan of reorganization
in any future concurso mercantil proceeding;
(ii) exercising all veto rights in connection with the
approval of a concurso plan in Mexico, but only in the
event that the plan is accepted by holders of a majority
of the aggregate outstanding principal amount of the
Second Priority Notes; and
(iii) releasing certain liens.
Other Disclosures
The Debtor disclosed that it has recently been granted an
extension of the Orbital Concessions to Oct. 22, 2037, without
the payment of any additional consideration to the Mexican
Government. As previously reported, the Mexican Government has
granted the Debtor three Orbital Concessions that allow it to
operate satellites in Mexico's orbital slots. The Orbital
Concessions may be further extended subject to certain
conditions.
The Debtor also reported that the order approving its convenio
concursal terminated the Concurso proceeding in Mexico, and
became final, binding and non-appealable on Aug. 1, 2006.
In addition, the Bankruptcy Court closed the Debtor's Section
304 Proceeding on Aug. 11, 2006. The Bankruptcy Court also
authorized the Debtor to assume its settlement agreements with
certain Loral entities.
Plan Has Support of Major Constituents
The Debtor relates that its Chapter 11 Plan has the support of:
-- Servicios, Loral and Principia;
-- the beneficial holders of more than 67% of the
10-1/8% Unsecured Senior Notes due Nov. 1, 2004; and
-- the beneficial holders of more than 67% of the Senior
Secured Floating Rate Notes due June 30, 2004.
A blacklined copy of the Debtor's First Amended Plan is
available at no charge at http://ResearchArchives.com/t/s?1178
About SATMEX
Satelites Mexicanos, S.A. de C.V., provides fixed satellite
services in Mexico. Satmex provides transponder capacity via its
satellites to customers for distribution of network and cable
television programming, direct-to-home television service, on-site
transmission of live news reports, sporting events and other video
feeds. Satmex also provides satellite transmission capacity to
telecommunications service providers for public telephone networks
in Mexico and elsewhere and to corporate customers for their
private business networks with data, voice and video applications.
Satmex also provides the government of the United Mexican States
with approximately 7% of its satellite capacity for national
security and public purposes without charge, under the terms of
the Orbital Concessions.
The Debtor filed for chapter 11 petition on August 11, 2006
(Bankr. S.D.N.Y. Case No. 06-11868). Luc A. Despins, Esq., at
Milbank, Tweed Hadley & McCloy LLP represents the Debtor in the
U.S. Bankruptcy proceedings. Attorneys from Galicia y Robles,
S.C., and Quijano Cortina Lopez y de la Torre give legal advice in
the Debtor's Mexican Bankrutpcy proceedings. UBS Securities LLC
and Valor Consultores, S.A. de C.V., give financial advice to the
Debtor. Steven Scheinman, Esq., Michael S. Stamer, Esq., and
Shuba Satyaprasad, Esq., at Akin Gump Strauss Hauer & Feld LLP
give legal advice to the Ad Hoc Existing Bondholders' Committee.
Dennis Jenkins, Esq., and George W. Shuster, Jr., Esq., at Wilmer
Cutler Pickering Hale and Dorr LLP give legal advice to Ad Hoc
Senior Secured Noteholders' Committee. As of July 24, 2006, the
Debtor has $905,953,928 in total assets and $743,473,721 in total
liabilities.
On May 25, 2005, certain holders of Satmex's Existing Bonds and
Senior Secured Notes filed an involuntary chapter 11 petition
against the Company (Bankr. S.D.N.Y. Case No. 05-13862).
On June 29, 2005, Satmex filed a voluntary petition for a Mexican
reorganization, known as a Concurso Mercantil, which was assigned
to the Second Federal District Court for Civil Matters for the
Federal District in Mexico City.
On Aug. 4, 2005, Satmex filed a petition, pursuant to Section 304
of the Bankruptcy Code that commenced a case ancillary to the
Concurso Proceeding and a motion for injunctive relief that sought
among other things, to enjoin actions against Satmex or its assets
(Bankr. S.D.N.Y. Case No. 05-16103).
SCOTTISH RE: $600 Mil. New Equity Deal Cues Fitch's Negative Watch
------------------------------------------------------------------
Fitch Ratings commented that Scottish Re Group Ltd.'s ratings
remain on Rating Watch Negative after the report that SCT has
entered into an agreement which will result in a new equity
investment into the company of $600 million.
SCT's ratings were placed on Rating Watch Negative on July 31,
2006 due to concerns regarding the company's ability to repay $115
million of senior convertible notes that are expected to be put to
the company on Dec. 6, 2006.
Fitch believes that SCT has made good progress in resolving the
key liquidity and collateral issues, and expects that remaining
issues will be resolved over the next several days that will allow
affiliate Scottish Annuity & Life Insurance Ltd. to dividend funds
to SCT to fund the expected put.
Once these remaining issues are resolved, Fitch expects to change
the direction of the Rating Watch to Evolving to reflect the
pending agreement with MassMutual Capital Partners LLC and
Cerberus Capital Management, L.P. announced today.
These ratings remain on Rating Watch Negative:
* Scottish Annuity & Life Insurance Company Limited
-- IFS at 'BBB'.
* Scottish Re (U.S.) Inc.
-- IFS at 'BBB'.
* Scottish Re Limited
-- IFS at 'BBB'.
* Scottish Re Group Limited
-- IDR at 'BB';
-- 4.5% $115 million senior convertible notes at 'BB-';
-- 5.875% $142 million hybrid capital units at 'B+'; and,
-- 7.25% $125 million non-cumulative perpetual preferred
stock at 'B+'.
SCOTTISH RE: Stake Sale Deal Cues Moody's Continued Ratings Review
------------------------------------------------------------------
Moody's Investors Service continues to review the ratings of
Scottish Re Group Limited with direction uncertain after the
report by the company that it has entered into an agreement to
sell a majority stake to MassMutual Capital Partners LLC, a member
of the MassMutual Financial Group and Cerberus Capital Management,
L.P., a private investment firm.
Moody's said the continuing review affects the debt rating of
Scottish Re, as well as the Baa3 insurance financial strength
ratings of the company's core insurance subsidiaries, Scottish
Annuity & Life Insurance Company Ltd. and Scottish Re, Inc.
The uncertain direction of the review indicates the possibility
that Scottish Re's ratings could be upgraded, downgraded, or
confirmed depending on future developments at Scottish Re.
The Consortium investment of $600 million, split evenly between
the two investing partners, is in the form of a preferred equity
investment, convertible into common stock nine years from issuance
or earlier at the option of the Consortium. After closing, the
Consortium would hold preferred shares that are convertible, in
whole or in part, to 150 million ordinary shares of Scottish Re,
representing 68.8% of the total outstanding ordinary shares of the
company on a fully diluted basis.
"Should the transaction be successfully completed, the investment
will provide the company with much needed liquidity as well as a
robust capital position," according to Scott Robinson, Moody's
Vice President & Senior Credit Officer,
In addition, upon shareholder approval of the transaction, the
Consortium will provide Scottish Re with a bridge liquidity
facility of $100 million to assist the company through the time
period prior to closing of the deal.
Moody's indicated that under the terms of an existing bank credit
facility, Scottish Re has been constrained in its ability to move
funds from SALIC to the holding company, which is necessary to
provide Scottish Re the liquidity to pay off the $115 million of
convertible notes that are putable at par to the holding company
on Dec. 6, 2006.
The company is currently working to cancel remaining letters on
credit totaling less than $5 million that are outstanding on its
bank credit facility, after which it plans to terminate the
facility. Under the scenario that Scottish Re is unable to cancel
the LOCs, the company is also working to secure a back-up LOC, the
receipt of which would permit the movement of funds from SALIC to
the holding company under a pre-negotiated agreement permitting an
amendment to the bank credit facility agreement.
Scottish Re has already received a commitment letter from a
financial institution allowing it to issue a back-up letter of
credit.
The rating agency noted that should the announced deal not close,
there would be significant downward pressure on the company's
ratings.
According to Robinson, "failure to raise capital and liquidity
would result in a multi-notch downgrade of the ratings of Scottish
Re. We believe that the company would be significantly challenged
in such a runoff scenario."
During the continuing review, Moody's intends to closely monitor
the probability of a successful closing of the announced
transaction. A successful closing requires approval by two-thirds
of Scottish Re's shareholders as well as the approval of various
insurance regulators.
In determining whether or not the company's ratings will be raised
following a successful closing of the transaction, Moody's said
that it will also evaluate Scottish Re's post-investment business
plan, operating strategy, and plans to improve internal controls
and risk management at the company.
Additionally, Moody's highlighted that the review will focus on
Scottish Re's plan to secure a collateral solution to support the
company's XXX statutory reserving needs associated with its
existing level premium term reinsurance business, as well as its
ability to manage a runoff scenario, which should be considerably
enhanced by the capital infusion.
While the Consortium indicated that it intends to run Scottish Re
as a going concern, the rating agency noted that it believes
Scottish Re will have to regain the confidence of cedants before
it will be able to write meaningful amounts of new business.
Aside from the investment by the Consortium, this will likely
require a track record of stable earnings and cash flows,
something which the company has been unable to produce in recent
reporting periods.
These ratings continue on review with direction uncertain:
* Scottish Re Group Limited
-- senior unsecured debt of Ba3;
-- senior unsecured shelf of (P)Ba3;
-- subordinate shelf of (P)B1;
-- junior subordinate shelf of (P)B1;
-- preferred stock of B2; and,
-- preferred stock shelf of (P)B2
* Scottish Holdings Statutory Trust II
-- preferred stock shelf of (P)B1
* Scottish Holdings Statutory Trust III
-- preferred stock shelf of (P)B1
* Scottish Annuity & Life Insurance Co (Cayman) Ltd.
-- insurance financial strength of Baa3
* Premium Asset Trust Series 2004-4
-- senior secured debt of Baa3
* Scottish Re (U.S.), Inc.
-- insurance financial strength of Baa3
* Stingray Pass-Through Certificates
-- senior secured debt of Baa3
On Sept. 5, 2006 Moody's changed the direction of review for
Scottish Re's ratings to uncertain from possible downgrade.
Scottish Re Group Limited is a Cayman Islands company with
principal executive offices located in Bermuda; it also has
significant operations in Charlotte North Carolina, Denver
Colorado, and Windsor England. On Sept. 30, 2006, Scottish Re
reported assets of $13.8 billion and shareholders' equity of
$1.3 billion.
Moody's insurance financial strength ratings are opinions of the
ability of insurance companies to repay punctually senior
policyholder claims and obligations.
SKY DEVELOPERS: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Sky Developers Inc.
1807 North Alexandria Avenue #8
Los Angeles, CA 90027
Bankruptcy Case No.: 06-16168
Chapter 11 Petition Date: November 27, 2006
Court: Central District Of California (Los Angeles)
Judge: Barry Russell
Debtor's Counsel: John F. Nicholson, Esq.
Law Office of John F. Nicholson
21243 Ventura Boulevard, Suite 226
Woodland Hills, CA 91364
Tel: (818) 348-3806
Estimated Assets: $1 Million to $100 Million
Estimated Debts: $1 Million to $100 Million
The Debtor does not have any unsecured creditors who are not
insiders.
SOUTH STREET: Fitch Affirms Junk Ratings on $19MM Class B Notes
---------------------------------------------------------------
Fitch downgrades the ratings on two classes of notes issued by
South Street CBO 2000-1, Ltd., a collateralized bond obligation
backed by high yield bonds.
The rating on one class of notes is affirmed, three classes of
notes are revised, and the ratings on two classes of notes remain
unchanged:
* $27,594,496 class A-2L notes affirmed at 'AAA';
* $15,000,000 class A-3L notes downgraded to 'BB-' from 'BBB-';
* $30,000,000 class A-3 notes downgraded to 'BB-' from 'BBB-';
* $20,000,000 class A-4L notes revised to 'CC/DR4' from
'CC/DR3';
* $8,000,000 class A-4A notes revised to 'CC/DR4' from
'CC/DR3';
* $10,000,000 class A-4C notes revised to 'CC/DR4' from
'CC/DR3';
* $15,000,000 class B-1 notes remain at 'C/DR6';
* $4,198,658 class B-2 notes remain at 'C/DR6'.
Class A-1L notes has been paid in full.
According to its Oct. 17, 2006 trustee report, an additional
$8.3 million par amount of assets have defaulted since the last
review on Jan. 25, 2005.
Since last review, the senior class A overcollateralization test,
which includes the class A-2L, class A-3L and class A-3 notes, is
passing at 137.5% versus 133.2% with a trigger of 120%. The class
A OC test, class B OC test and additional coverage test are still
failing and have declined further since the last review and are
currently at 89%, 70% and 54.26%, versus last review of 99.96%,
86.59%, and 78.06, with a trigger of 110%, 103% and 108%,
respectively.
Furthermore, the class A IO amount diverts interest proceeds away
from the class A OC test to pay interest and principal on the
class B-2 notes.
The downgrade of the class A-3L and class A-3 notes reflects the
continued deterioration of the portfolio.
In addition, Fitch has reviewed the results of cash flow model
runs, incorporating several different default and interest rate
stress scenarios. Also, Fitch discussed with Colonial Management
Associates, Inc., the investment advisor, their expectations and
opinions of the portfolio.
Fitch will continue to monitor and review this transaction for
future rating adjustments.
SOUTH STREET: Fitch Holds Rating on $45MM Class A-3 Notes at C
--------------------------------------------------------------
Fitch upgraded the ratings on two classes of notes issued by South
Street CBO 1999-1, Ltd., a collateralized bond obligation backed
by high yield bonds.
The ratings on two classes of notes are revised and the ratings on
one class of notes remain unchanged.
* $580,796 class A-1LB notes upgraded to 'AA' from 'BBB-';
* $3,194,381 class A-1 notes upgraded to 'AA' from 'BBB-';
* $24,000,000 class A-2L notes revised to 'CC/DR4' from
'CC/DR3';
* $36,000,000 class A-2 notes revised to 'CC/DR4' from
'CC/DR3'; and
* $45,500,000 class A-3 notes remain at 'C/DR5'.
Class A-1LA notes have been paid in full.
The upgrade of the class A-1LB and class A-1 notes reflects the
continued paydown of those classes. Since the last rating action
on Dec. 23, 2004, the classes A-1LB and A-1 notes have paid down
$46.6 million or 92.5%. Fitch has reviewed the results of cash
flow model runs, incorporating several different default and
interest rate stress scenarios.
Also, Fitch discussed with Colonial Management Associates, Inc.,
the investment advisor, their expectations and opinions of the
portfolio.
According to its Oct. 17, 2006 trustee report, the South Street
CBO portfolio collateral includes a par amount of $41.6 million of
defaulted assets.
Since last review, the class A overcollateralisation test is
failing at 39.8% versus 63.6% with a trigger of 115%. The class B
overcollateralisation test is failing at 31.2%, versus 53.5% with
a trigger of 104%.
Since the transaction is deleveraging because of the class A
overcollateralisation test failure, there has been significant
redemptions to the class A-1LB and A-1 notes, which has increased
credit enhancement provided to these classes. DR revisions to the
class A-2L and A-2 notes reflect the continued deterioration of
the portfolio.
SPECIALTYCHEM PRODUCTS: IPP Buys ChemDesign's Closed Facility
-------------------------------------------------------------
International Process Plants has completed a purchase of a
recently closed plant facility from ChemDesign Corporation, Aaron
Wasserman of the Sentinel & Enterprise reports.
Cheryl Sergewick, business development director for IPP, told
Sentinel & Enterprise in an interview that IPP wants to resell the
plant as a complete operating facility to a qualified buyer,
preferably a chemical manufacturer. If the company is unable to
sell the plant, Ms. Sergewick said, they will liquidate the
facility. She commented that the facility is in excellent
condition.
According to the Worcester Northern District Registry of Deeds, a
subsidiary of IPP in Massachusetts bought the plant facility from
ChemDesign for $750,000 on Nov. 10, 2006. IPP has just begun
marketing the facility and has not spoken to any potential buyers
yet, the source said.
ChemDesign, the parent company of SpecialtyChem Products
Corporation, closed the plant when it consolidated its operations
in another location at Marinette, Wisconsin, John A. Cote, the
company's vice president of operations, said in the report.
About International Process
Based in Hamilton, New Jersey, International Process Plants --
http://www.ippe.com/-- invests in various types of industrial
plants, and resells them to qualified customers. The company even
offers plant relocation services. It has more than 70 complete
plants and process lines, and about 27,000 major pieces of
equipment, and has offices in China, India and throughout Europe.
About ChemDesign Corp.
Headquartered in Fitchburg, Massachusetts, ChemDesign Corporation
-- http://www.chemdesigncorp.com/-- is a custom manufacturer of
various fine organic chemicals for paper products, electronics,
agricultural products and other materials. The Debtor filed for
chapter 11 protection on Aug. 27, 2006 (Bankr. E.D. Wis. Case No.
06-24729. When the Debtor filed for protection from its
creditors, it estimated assets and debts between $10 million and
$50 million.
About SpecialtyChem Products
Headquartered in Marinette, Wisconsin, SpecialtyChem Products,
Corp., manufactures various organic chemicals for paper products,
electronics, agricultural products and other materials. The
company filed for chapter 11 protection on June 12, 2006 (Bankr.
E.D. Wis. Case No. 06-23131). Christopher J. Stroebel, Esq.,
Timothy F. Nixon and Marie L. Nienhuis, Esq., at Godfrey & Kahn,
S.C., represent the Debtor in its restructuring efforts. Fort
Dearborn Partners, Inc., is the Debtor's turnaround consultant,
and gives financial advice to the Debtor. Matthew M. Beier, Esq.,
and Eliza M. Reyes, Esq., at Brennan, Steil and Basting, S.C., and
Matthew T. Gensburg, Esq., and Nancy A. Peterman, Esq., at
Greenberg Traurig, L.L.P., represent the Official Committee of
Unsecured Creditors of the Debtor. In its schedule of assets and
liabilities, the Debtor disclosed $11,394,224 in total assets and
$12,323,425 in total debts.
STARDUST YACHTS: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Stardust Yachts, LLC
fka Stardust Cruisers, Inc.
fka Stardust Transportation, LLC
fka Star Cabinets, Inc.
2300 East Highway 90 Bypass
Monticello, KY 42633-2111
Bankruptcy Case No.: 06-60792
Chapter 11 Petition Date: November 27, 2006
Court: Eastern District of Kentucky (London)
Judge: Joseph M. Scott Jr.
Debtor's Counsel: W. Thomas Bunch, II, Esq.
Bunch & Brock
271 West Short Street, Suite 805
P.O. Box 2086
Lexington, KY 40588-2086
Tel: (859) 254-5522
Fax: (859) 233-1434
Total Assets: $4,223,036
Total Debts: $13,853,807
Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Robert and Katy York Fourth lien on all $2,246,750
42 Harrison Avenue equipment
Monticello, KY 42633 Secured value:
$153,250
Hendricks Family Charitable Fifth lien - no value $350,000
Rem. Trust
19002 North 21st Avenue
Phoenix, AZ 85027
American Express Unsecured $325,527
Suite 0001
Chicago, IL 60679-0001
Resot Yachts, LLC $165,000
Workers Gaurdian Self Insurance $164,250
Insurance Fund
Cummins Cumberland, Inc. Judgment lien $139,876
McEwen Lumber Company $103,316
Mercury Marine Unsecured $87,819
Susan Lancaster $62,250
Lexington Insurance Company Unsecured $57,500
Ivanhoe Associates, LLC $50,000
Kenneth O'Keeffe Unsecured $49,921
Sears Commercial One Unsecured $39,849
Volvo Penta Unsecured $37,616
Standard Funding Corp. $27,346
Joseph T. Ryerson & Son, Unsecured $24,154
Inc.
Sharon Meacham $24,000
Office of Workers Claims Unsecured $22,000
Fiberglass Concepts, Inc. Unsecured $20,275
MBNA America Unsecured $19,837
STEVE'S SHOES: Accord With Panel & Ohio Tax Department Approved
---------------------------------------------------------------
The Honorable Robert D. Berger of the U.S. Bankruptcy Court for
the District of Kansas approved a tax settlement entered into
among Steve's Shoes Inc., its Official Committee of Unsecured
Creditors, and the Ohio Department of Taxation.
Ohio filed two claims:
-- Claim 106 for $870.52 for sales and franchise taxes,
of which Steve's Shoes only paid the sales tax portion; and
-- Claim 116 for $286,731.46 for sales and use taxes.
Ohio also asserted that Steve's Shoes, the Debtor, owed $190 for a
commercial activity tax for the period July 1, 2005, to Dec. 31,
2005, and $1,000 for a corporation franchise tax for tax year
2006.
The parties negotiated an arms-length settlement in which all of
Ohio's claims will be allowed for $34,003.03.
Headquartered in Lenexa, Kansas, Steve's Shoes Inc. --
http://www.stevesshoes.com/-- was a shoe retailer. The
Company filed for chapter 11 protection on Jan. 6, 2006
(Bankr. D. Kans. Case No. 06-20015). Thomas M. Mullinix, Esq.,
and Joanne B. Stutz, Esq., Evans & Mullinix, P.A., represent
the Debtor. Brent Weisenberg, Esq., and Jay R Indyke, Esq., at
Kronish Lieb Weiner & Hellman LLP, represent the Official
Committee of Unsecured Creditors. When the Debtor filed for
protection from its creditors, it listed total assets of
$9,494,325 and total debts of $20,200,821.
TIER TECHONLOGIES: Gets Fraud Complaint from Securities Holders
---------------------------------------------------------------
Goldman Scarlato & Karon PC, filed in the U.S. District Court
for the Eastern District of Virginia, on behalf of persons who
purchased or otherwise acquired publicly traded securities of Tier
Technologies Inc. between Nov. 29, 2001 and Oct. 25, 2006,
inclusive. The lawsuit was filed against Tier and certain
officers and directors.
The complaint alleges that Defendants violated Sections 10(b) and
20(a) of the Securities Exchange Act of 1934 and Rule 10b-5
promulgated thereunder. Specifically, the complaint alleges that
Tier issued a series of false and misleading financial statements
by overstating Company earnings and underreporting Company losses.
On Dec. 14, 2005, Tier announced that its financial statements for
the fiscal years ended Sept. 30, 2002 through September 30, 2004
and quarterly periods through June 30, 2005 should no longer be
relied upon as a restatement of these financial results would be
necessary. On Oct. 25, 2006, the Company finally restated its
financial statements indicating that the Company had over reported
its net income and underreported losses for approximately five
years.
If you are a member of this class and wish to view a copy of a
complaint and join this class action, please e-mail us at
info@gsk-law.com and request a copy of the complaint and a
plaintiff certification.
If you are a member of the Class, you may move the Court no later
than January 9, 2007 to serve as a lead plaintiff for the Class.
Any member of the purported class may move the Court to serve as
lead plaintiff through counsel of their choice, or may choose to
do nothing and remain an absent class member.
Headquartered in Reston, Virginia, Tier Technologies, Inc.
-- http://www.tier.com/-- provides transaction processing and
packaged software and systems integration services to more than
2,200 federal, state, and local governments, educational
institutions, utilities and commercial clients in the U.S. and
abroad. The Company, through its subsidiary, Official Payments
Corp. -- http://www.officialpayments.com/-- designs, installs and
maintains cutting-edge public sector software systems, and
delivers fast, secure and convenient financial transaction
processing solutions.
Defaults
As reported in the Troubled Company Reporter on March 21, 2006,
the expected restatement, the delayed availability of Tier
Technologies, Inc.'s financial statements for the fiscal year
ended Sept. 30, 2005, and the anticipated loss for the quarter
ended Sept. 30, 2005, constituted events of default under the
revolving credit agreement between the Company and its lender,
City National Bank. In addition, the Company incurred similar
events of default for the quarter ended Dec. 31, 2005.
W.R. GRACE: Wants Court to Reject Speights & Runyanss Requests
--------------------------------------------------------------
W.R. Grace & Co. and its debtor-affiliates ask the U.S. Bankruptcy
Court District of Delaware to deny Speights & Runyan's deposition
notices and discovery requests because they:
(1) seek information that is irrelevant and not reasonably
calculated to lead to the discovery of information
relevant to Anderson class certification;
(2) are extremely burdensome and overly broad, in that they
seek "all documents" relating to 16 broad document
requests and 11 broad deposition topics;
(3) seek production of documents and deposition testimony
that are subject to privileges, including the attorney-
client and work product privileges; and
(4) purport to impose obligations, burdens and duties on the
Debtors that vastly exceed the requirements or
permissible scope of discovery under the Federal Rules of
Bankruptcy Procedure.
Mr. O'Neill explains that to warrant class certification:
(x) a court must determine whether a class action "makes
sense" and will advance the bankruptcy's interests; and
(y) even if claimants can demonstrate that a class may be an
acceptable way to proceed in a particular bankruptcy
case, the claimants must also satisfy the Civil Rule 23
requirements of commonality, typicality and adequacy of
representation.
Moreover, Mr. O'Neill asserts that the Bankruptcy Court has
recognized that there was a bar date for PD Claims in March 2003
and that the Debtors' notice program was extensive. Therefore,
claims that have never been filed before the Bankruptcy Court
cannot be made part of a putative class, he maintains.
Anderson Responds
Christopher D. Loizides, Esq., at Loizides & Associates, in
Wilmington, Delaware, relates that Rule 408 of the Federal Rules
of Evidence does not create immunity from discovery of the
conduct and statements of the Debtors and their representatives.
"Anderson is entitled to this discovery to develop the factual
predicate upon which the Debtors' statements and conduct were
based, as well as to create a record for impeachment of the
Debtors and the factual assertions it has made regarding the
Anderson Class Certification Motion," Mr. Loizides asserts.
Accordingly, Anderson asks the Court to permit Speights'
discovery requests to go forward so that it can make an
admissibility determination under Rule 408, when the evidence is
offered.
Debtors Talk Back
Mr. O'Neill contends that Rule 408 reflects important policy
considerations. He explains that settlement offers are
irrelevant since they "may be motivated by a desire for peace
rather than from any concession of weakness of position."
The more consistently impressive ground for excluding evidence of
settlement negotiations, however, is that exclusion promotes "the
public policy favoring the compromise and settlement of
disputes," Mr. O'Neill avers.
Furthermore, Mr. O'Neill maintains that Rules 408 and 403 render
inadmissible the statements Grace made in the course of purported
Anderson settlement negotiations, for purposes of supporting the
Class Certification Motion.
Mr. O'Neill notes that Grace's purported efforts to settle the
South Carolina lawsuit are not even relevant to the requirements
for class certification, especially at this stage in bankruptcy
where:
(i) Grace implemented a multi-million dollar notice and bar
date program to bring all property damage claimants
before the Court;
(ii) the Court approved the notice and bar date program and
later concluded that the program was thorough; and
(iii) only 166 Speights U.S. Claims remain.
Mr. O'Neill insists that permitting Speights' discovery requests
to go forward would violate the "settlement privilege" that
protects the content of settlement negotiations from discovery.
James E. O'Neill, Esq., at Pachulski Stang Ziehl Young Jones &
Weintraub LLP, in Wilmington, Delaware, relates that on Oct. 30,
2006, Speights & Runyan served, on Anderson Memorial Hospital's
behalf, "extremely broad, non-tailored requests that once again
seek all documents in the Debtors' files on a host of issues that
have no bearing" on whether certification will advance the
interests of the Debtors' Chapter 11 cases or whether the
requirements of Rule 23 of the Federal Rules of Civil Procedure
can be met.
Mr. O'Neill notes that as of November 6, 2006, there are
637 total pending asbestos property damage claims, including 166
U.S. Speights claims, 97 Canadian Speights claims, and only three
South Carolina claims -- even fewer claims than in January 2006,
when the Bankruptcy Court initially recognized that the
numerosity requirement for class certification cannot be met.
Mr. O'Neill tells Judge Fitzgerald that Speights & Runyan has
requested deposition testimony and "all documents" regarding:
(i) Anderson's South Carolina lawsuit, Anderson's request to
certify in South Carolina, the certification hearing, any
purported efforts to delay the same, and circumstances
surrounding the South Carolina Circuit Court's
certification of a statewide class as to W.R. Grace &
Co.;
(ii) members or potential members of the putative Anderson
class;
(iii) damage estimates of Anderson's individual and class
claims;
(iv) any position the Debtors took with respect to Anderson's
request to be included on the Official Committee of
Asbestos Property Damage Claimants;
(v) any evaluation of Anderson's individual or class claims
before the Debtors' Petition Date; and
(vi) the Debtors' knowledge before September 1, 2005, of
Anderson's individual and class proofs of claim.
Speights & Runyan also requested "all documents" relating to:
-- the identity of any asbestos-containing surface treatment
in any building owned or operated by Anderson and
potential membership of Anderson's putative class,
including buildings located in South Carolina and outside
of South Carolina;
-- communications with witnesses involving any issues in
Anderson's efforts to obtain class certification;
-- the Debtors' knowledge concerning the facts or factual
assertions relating to Anderson's putative class action;
-- any amount that could or should be set aside for the
resolution of Anderson's claim, including any insurance
reserve;
-- communications between the Debtors and insurers relating
to Anderson's claims; and
-- communications with any building owners regarding the
Anderson proofs of claim.
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally. The Company and its
debtor-affiliates filed for chapter 11 protection on April 2, 2001
(Bankr. D. Del. Case No. 01-01139). James H.M. Sprayregen, Esq.,
at Kirkland & Ellis, and Laura Davis Jones, Esq., at Pachulski,
Stang, Ziehl, Young, Jones & Weintraub, P.C., represent the
Debtors in their restructuring efforts. The Debtors hired
Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.
Stroock & Stroock & Lavan LLP represent the Official Committee of
Unsecured Creditors. The Creditors Committee tapped Capstone
Corporate Recovery LLC for financial advice. David T. Austern,
the legal representative of future asbestos personal injury
claimants, is represented by Orrick Herrington & Sutcliffe LLP and
Phillips Goldman & Spence, PA. Anderson Kill & Olick, P.C.,
represent the Official Committee of Asbestos Personal Injury
Claimants. The Asbestos Committee of Property Damage Claimants
tapped Martin W. Dies, III, Esq., at Dies & Hile L.L.P., and C.
Alan Runyan, Esq., at Speights & Runyan,to represent it. Lexecon,
LLP, provided asbestos claims consulting services to
the Official Committee of Equity Security Holders. (W.R. Grace
Bankruptcy News, Issue No. 119; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).
W.R. GRACE: Selects Ogilvy Renault as Canadian Counsel
------------------------------------------------------
The W.R. Grace & Co. and its debtor-affiliates ask the U.S.
Bankruptcy Court District of Delaware, for permission to employ
Ogilvy Renault LLP as their special counsel to perform legal
services primarily relating to pending asbestos property damage
and personal injury claims identified as having been brought by
certain Canadian claimants.
Since 2001, Ogilvy Renault and its partners and associates have
worked with U.S. legal counsel to the Debtors in connection with,
inter alia, formulating strategy in respect of asbestos claims
against the Debtors and their affiliated entity, Grace Canada,
Inc.
The Debtors believe that Ogilvy Renault is intimately familiar
with many of the complex legal issues that arise in connection
with the ongoing issues related to their Chapter 11 cases because
of the firm's extensive experience and expertise in bankruptcy
and insolvency, personal injury, and class action proceedings in
Canada.
Specifically, Ogilvy Renault will:
(a) advise and assist the Debtors and their U.S. legal
counsel with respect to research, preparation of
materials for court, and Canadian expert-related issues;
and
(b) perform other related services as the Debtors and their
U.S. counsel may deem necessary or desirable.
While it is possible that certain aspects of the representations
will necessarily involve both Ogilvy and the Debtors' bankruptcy
and reorganization counsel, the Debtors assure the Court that
Ogilvy's services will be unique and specialized rather than
duplicative of the services to be performed by their bankruptcy
and reorganization counsel.
Ogilvy's customary hourly rates, subject to periodic adjustments,
are:
Professionals Designations Hourly Rates
------------- -------------- ------------
Derrick C. Tay, Esq. Senior Partner $850
Ian Ness, Esq. Partner $635
Karen Galpern, Esq. Partner $575
Orestes Pasparakis, Esq. Partner $535
Teresa Walsh, Esq. Partner $490
Jennifer Stam, Esq. Attorney $400
Allison Kuntz, Esq. Attorney $270
Karen Whibley Law clerk $210
Penny Adams Law clerk $140
Katie Legree Law clerk $95
Articling student $160
Other counsel or law clerks may from time to time serve the
Debtors in the matters for which Ogilvy's employment is sought.
The Debtors will also pay Ogilvy for expenses incurred in
connection with the case.
Teresa J. Walsh, Esq., a partner at Ogilvy, attests that the firm
does not represent or hold any interest adverse to the Debtors or
their estates with respect to the matters for which it is to be
employed. She adds that Ogilvy does not have any connection with
any creditors or other parties-in-interest, or the United States
Trustee or any of its employees.
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally. The Company and its
debtor-affiliates filed for chapter 11 protection on April 2, 2001
(Bankr. D. Del. Case No. 01-01139). James H.M. Sprayregen, Esq.,
at Kirkland & Ellis, and Laura Davis Jones, Esq., at Pachulski,
Stang, Ziehl, Young, Jones & Weintraub, P.C., represent the
Debtors in their restructuring efforts. The Debtors hired
Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.
Stroock & Stroock & Lavan LLP represent the Official Committee of
Unsecured Creditors. The Creditors Committee tapped Capstone
Corporate Recovery LLC for financial advice. David T. Austern,
the legal representative of future asbestos personal injury
claimants, is represented by Orrick Herrington & Sutcliffe LLP and
Phillips Goldman & Spence, PA. Anderson Kill & Olick, P.C.,
represent the Official Committee of Asbestos Personal Injury
Claimants. The Asbestos Committee of Property Damage Claimants
tapped Martin W. Dies, III, Esq., at Dies & Hile L.L.P., and C.
Alan Runyan, Esq., at Speights & Runyan,to represent it. Lexecon,
LLP, provided asbestos claims consulting services to
the Official Committee of Equity Security Holders. (W.R. Grace
Bankruptcy News, Issue No. 119; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000)
WASHINGTON MUTUAL: Fitch Lifts Low-B Ratings on Two Cert. Classes
-----------------------------------------------------------------
Fitch Ratings has taken rating actions on these Washington Mutual
residential mortgage-backed certificates:
Series 2003-S2:
-- Class A affirmed at 'AAA';
-- Class B-3 affirmed at 'A-';
-- Class B-4 affirmed at 'BBB-'; and,
-- Class B-5 affirmed at 'BB'.
Series 2004-AR1
-- Class A affirmed at 'AAA';
-- Class B-1 upgraded to 'AA+' from 'AA';
-- Class B-2 upgraded to 'A+' from 'A';
-- Class B-3 upgraded to 'BBB+' from 'BBB';
-- Class B-4 upgraded to 'BB+' from 'BB'; and,
-- Class B-5 upgraded to 'B+' from 'B'.
Series 2004-S1
-- Class A affirmed at 'AAA';
-- Class B-1 affirmed at 'AA';
-- Class B-2 affirmed at 'A';
-- Class B-3 affirmed at 'BBB';
-- Class B-4 affirmed at 'BB'; and,
-- Class B-5 affirmed at 'B'.
The affirmations, affecting approximately $592.9 million of the
outstanding certificates, are due to credit enhancement consistent
with future loss expectations. The upgrades, affecting
approximately $16.8 million of the outstanding certificates, are
being taken as a result of low delinquencies and losses, as well
as increased credit support levels. The credit enhancement for
the upgraded classes as of Oct. 25, 2006 distribution increased as
much as 2x the original credit enhancement percentage.
The collateral for the above WAMU deals primarily consists of 15
to 30 year fixed rate mortgages secured by first liens on one-to
four-family residential properties. The 'AR' deals have
collateral which consists of 15-year to 30-year adjustable rate
mortgages, also secured by first liens on one-to four-family
residential properties. As of the Oct. 2006 distribution date,
the seasoning ranges between 32 to 43 months and the pool factors
range from approximately 33% to 63%. All of the above deals are
master serviced by Washington Mutual Mortgage Securities Corp.,
which is rated 'RMS2+' by Fitch.
* Brian Pass Joins Sheppard Mullin's Intellectual Property Group
----------------------------------------------------------------
Brian Pass has joined the Century City office of Sheppard, Mullin,
Richter & Hampton LLP as a partner in the Entertainment, Media and
Communications and the Intellectual Property practice groups.
Senior associate Kevin Straw will be joining Pass on the move to
Sheppard Mullin. Both most recently practiced with Brown Raysman
in Los Angeles, where Pass led the firm's West Coast Technology,
Media and Communications practice.
Mr. Pass focuses his practice on high technology and corporate
law. He represents technology, entertainment and media clients in
the licensing, development and distribution of computer software,
Web-based services and applications, hardware development and OEM
relationships, new media and web site licensing, development and
marketing, intellectual property and trade secret protection,
broadband communications, interactive television and e-commerce.
Additionally, Mr. Pass counsels early stage and emerging growth
companies in start-up formation, joint ventures, as well as
mergers and acquisitions. He also advises companies on Internet
privacy and other regulatory issues affecting new media and e-
commerce.
Since 2001, Mr. Pass has closed over $2 billion in technology
transactions. Representative work includes: negotiation of
numerous affiliation agreements on behalf of a leading Internet
search portal; outside counsel to a leading manufacturer of third-
party video game accessories; outside counsel to a joint venture
formed to develop and deliver video on demand and interactive
services; negotiation of a multi-million dollar white label
e-commerce co-marketing agreement; outside counsel to a leading
Internet-based music discovery service; and negotiation of
numerous multi-million dollar enterprise license and Web services
transactions in the entertainment, healthcare and fashion
industries.
"Brian is a strategic addition to the firm," said Guy Halgren,
chairman of the firm. "He will play a key role in the expansion
of our technology capabilities, with a practice that straddles the
firm's entertainment, corporate and IP groups."
"I am thrilled to be joining the dynamic team of talented
attorneys in the Century City office," Mr. Pass said. "Sheppard
Mullin has an outstanding entertainment practice and an excellent
reputation in corporate law. I'm looking forward to contributing
to the continued success of both groups."
"We are excited to welcome a partner of Brian's caliber and
experience," said Bob Darwell, chair of the firm's Entertainment,
Media and Communications practice group. "His convergence and new
media practice adds depth to our technology and media
specializations."
Prior to practicing law, Mr. Pass co-founded Passport New Media
and served as its president and CEO. He led the development of
Passport's critically acclaimed children's Internet service, Your
Own World. At Passport, he raised $7.5 million in venture
capital, while concluding numerous third-party content
partnerships and negotiating key technology and distribution
relationships. Prior to forming Passport, he served as vice
president and general counsel at americast, a joint venture of The
Walt Disney Corporation and several of the Baby Bell telephone
companies to develop interactive digital television services.
Mr. Pass received his law degree from UCLA School of Law in 1991,
and graduated, with high honors, from Wesleyan University with a
B.A. in 1986. In 2006, Mr. Pass was named by Chambers USA as one
of the Leading Lawyers for Business in the IT and IT Outsourcing
field in California.
About Sheppard, Mullin, Richter & Hampton LLP
Founded in 1927, Sheppard, Mullin, Richter & Hampton LLP --
http://www.sheppardmullin.com/-- is a full-service AmLaw 100 firm
with 490 attorneys in nine offices located throughout California
and in New York and Washington, D.C. The firm's California
offices are located in Los Angeles, San Francisco, Santa Barbara,
Century City, Orange County, Del Mar Heights and San Diego.
Sheppard Mullin provides legal expertise and counsel to U.S. and
international clients in a wide range of practice areas, including
Antitrust, Corporate and Securities; Entertainment, Media and
Communications; Finance and Bankruptcy; Government Contracts;
Intellectual Property; Labor and Employment; Litigation; Real
Estate/Land Use; Tax/Employee Benefits/Trusts & Estates; and White
Collar Defense.
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
November 30, 2006
EUROMONEY CONFERENCES
Euromoney/DIFC Annual Conference
Managing superabundant liquidity
Madinat Jumeirah, Dubai
Contact: http://www.euromoneyconferences.com/
November 30, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Restructuring Around Intellectual Property -
Preserving Value When Trouble Lurks
Carnelian Room, San Francisco, CA
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 1, 2006
CEB
Creditors' Remedies & Debtors' Rights
Garden Grove, CA
Contact: http://www.ceb.com/
December 4-5, 2006
PRACTISING LAW INSTITUTE
Mortgage Servicing & Default Management
Washington, DC
Contact: http://www.pli.edu/
December 5, 2006
EUROMONEY CONFERENCES
CFO Forum
Hyatt Regency, Hangzhou, China
Contact: http://www.euromoneyconferences.com/
December 6, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Intellectual Property -
Are You Overlooking Significant Value?
5th Avenue Suites, Portland, OR
Contact: http://www.turnaround.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 7, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Cash Management After The Storm:
Near-Term Planning for Long-Term Business Success
Sheraton, Metairie, LA
Contact: http://www.turnaround.org/
December 8, 2006
CEB
Creditors' Remedies & Debtors' Rights
Los Angeles / Century City, CA
Contact: http://www.ceb.com/
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 11, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Lender's Panel
University Club, Jacksonville, FL
Contact: http://www.turnaround.org/
January 12, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Annual Lender's Panel Breakfast
Westin Buckhead, Atlanta, GA
Contact: http://www.turnaround.org/
January 17, 2007
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
TBA, South FL
Contact: 561-882-1331 or http://www.turnaround.org/
January 17-19, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Distressed Investing Conference
Wynn, Las Vegas, NV
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 22, 2007
TURNAROUND MANAGEMENT ASSOCIATION
TMA PowerPlay - Atlanta Thrashers
Philips Arena, Atlanta, GA
Contact: 678-795-8103 or http://www.turnaround.org/
January 25-27, 2007
AMERICAN BANKRUPTCY INSTITUTE
Rocky Mountain Bankruptcy Conference
Hyatt Regency, Denver, CO
Contact: 1-703-739-0800; http://www.abiworld.org/
February 8-9, 2007
EUROMONEY
Leveraged Finance Asia
JW Marriott Hong Kong
Contact: http://www.euromoneyplc.com/
February 21-22, 2007
EUROMONEY
Euromoney Pakistan Conference
Perceptions & Realities
Marriott Hotel, Islamabad, Pakistan
Contact: http://www.euromoneyplc.com/
February 22, 2007
EUROMONEY
2nd Annual Euromoney Japan Forex Forum
Mandarin Oriental, Tokyo, Japan
Contact: http://www.euromoneyplc.com/
February 25-26, 2007
NORTON INSTITUTES
Norton Bankruptcy Litigation Institute
Marriott Park City, UT
Contact: http://www2.nortoninstitutes.org/
February 2007
AMERICAN BANKRUPTCY INSTITUTE
International Insolvency Symposium
San Juan, Puerto Rico
Contact: 1-703-739-0800; http://www.abiworld.org/
March 1, 2007
AMERICAN BANKRUPTCY INSTITUTE
Nuts and Bolts for Young Practitioners - West
Regency Beverly Wilshire, Los Angeles, CA
Contact: http://www.abiworld.org/
March 2, 2007
AMERICAN BANKRUPTCY INSTITUTE
15th Annual Bankruptcy Battleground West
Regency Beverly Wilshire, Los Angeles, CA
Contact: 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 21, 2007
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
TBA, South FL
Contact: 561-882-1331 or http://www.turnaround.org/
March 21-22, 2007
EUROMONEY
2nd Annual Vietnam Investment Forum
Melia, Hanoi, Vietnam
Contact: http://www.euromoneyplc.com/
March 21-22, 2007
EUROMONEY
Euromoney Indian Financial Market Congress
Grand Hyatt, Mumbai, India
Contact: http://www.euromoneyplc.com/
March 27, 2007
TURNAROUND MANAGEMENT ASSOCIATION
"The Six Keys of Sustained Profitable Growth"
Rodney Page, Senior Partner of Blue Springs Partners
Citrus Club, Orlando, FL
Contact: http://www.turnaround.org/
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 12, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
University Club, Jacksonville, FL
Contact: 561-882-1331 or http://www.turnaround.org/
April 12, 2007
AMERICAN BANKRUPTCY INSTITUTE
Nuts and Bolts for Young Practitioners - East
JW Marriott, Washington, DC
Contact: 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/
April 24, 2007
TURNAROUND MANAGEMENT ASSOCIATION
"Why Prospects Become Clients"
Mark Fitzgerald, President of Sales Training Institute Inc
Centre Club, Tampa, FL
Contact: http://www.turnaround.org/
April 26-28, 2007
ALI-ABA
Fundamentals of Bankruptcy Law
Philadelphia, PA
Contact: http://www.ali-aba.org
April 29 - May 1, 2007
INTERNATIONAL BAR ASSOCIATION
International Insolvency Conference
Zurich, Switzerland
Contact: http://www.ibanet.org/
May 14, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Annual TMA Atlanta Golf Outing
White Columns, Atlanta, GA
Contact: 678-795-8103 or http://www.turnaround.org/
May 4, 2007
AMERICAN BANKRUPTCY INSTITUTE
Nuts and Bolts for Young Practitioners - NYC
Alexander Hamilton US Custom House, SDNY
New York, NY
Contact: http://www.abiworld.org/
May 7, 2007
AMERICAN BANKRUPTCY INSTITUTE
9th Annual New York City Bankruptcy Conference
Millennium Broadway Hotel & Conference Center
New York, NY
Contact: http://www.abiworld.org/
May 16, 2007
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
TBA, South FL
Contact: 561-882-1331 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/
June 28 - July 1, 2007
NORTON INSTITUTES
Norton Bankruptcy Litigation Institute
Jackson Lake Lodge, Jackson Hole, WY
Contact: http://www2.nortoninstitutes.org/
July 12, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
University Club, Jacksonville, FL
Contact: 561-882-1331 or www.turnaround.org
July 12-15, 2007
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Marriott, Newport, RI
Contact: 1-703-739-0800; http://www.abiworld.org/
July 18, 2007
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
TBA, South FL
Contact: 561-882-1331 or http://www.turnaround.org/
July 25-28, 2007
AMERICAN BANKRUPTCY INSTITUTE
12th Annual Southeast Bankruptcy Workshop
The Sanctuary, Kiawah Island, SC
Contact: http://www.abiworld.org/
August 9-11, 2007
AMERICAN BANKRUPTCY INSTITUTE
3rd Annual Mid-Atlantic Bankruptcy Workshop
Hyatt Regency Chesapeake Bay
Cambridge, MD
Contact: http://www.abiworld.org/
September 6-8, 2007
AMERICAN BANKRUPTCY INSTITUTE
15th Annual Southwest Bankruptcy Conference
Four Seasons
Las Vegas, NV
Contact: http://www.abiworld.org/
September 19, 2007
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
TBA, South FL
Contact: 561-882-1331 or http://www.turnaround.org/
October 10-13, 2007
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Orlando, Florida
Contact: http://www.ncbj.org/
October 11, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
University Club, Jacksonville, FL
Contact: 561-882-1331 or http://www.turnaround.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/
December 19, 2007
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
TBA, South FL
Contact: 561-882-1331 or http://www.turnaround.org/
January 10, 2008
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
University Club, Jacksonville, FL
March 25-29, 2008
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
Ritz Carlton Grande Lakes, Orlando, Florida
Contact: http://www.turnaround.org/
April 3-6, 2008
AMERICAN BANKRUPTCY INSTITUTE
26th Annual Spring Meeting
The Renaissance, Washington, DC
Contact: http://www.abiworld.org/
June 4-7, 2008
ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
24th Annual Bankruptcy & Restructuring Conference
JW Marriott Spa and Resort, Las Vegas, NV
Contact: http://www.airacira.org/
June 12-14, 2008
AMERICAN BANKRUPTCY INSTITUTE
15th Annual Central States Bankruptcy Workshop
Grand Traverse Resort and Spa, Traverse City, MI
Contact: http://www.abiworld.org/
August 16-19, 2008
AMERICAN BANKRUPTCY INSTITUTE
13th Annual Southeast Bankruptcy Workshop
Ritz-Carlton, Amelia Island, FL
Contact: http://www.abiworld.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/
December 4-6, 2008
AMERICAN BANKRUPTCY INSTITUTE
20th Annual Winter Leadership Conference
Westin La Paloma Resort & Spa
Tucson, AZ
Contact: http://www.abiworld.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
BEARD AUDIO CONFERENCES
BAPCPA One Year On: Lessons Learned and Outlook
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
Calpine's Chapter 11 Filing
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
Changes to Cross-Border Insolvencies
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
Changing Roles & Responsibilities of Creditors' Committees
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
Clash of the Titans -- Bankruptcy vs. IP Rights
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
Coming Changes in Small Business Bankruptcy
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
Dana's Chapter 11 Filing
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
Deepening Insolvency - Widening Controversy: Current Risks,
Latest Decisions
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
Distressed Market Opportunities
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
Distressed Real Estate under BAPCPA
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
Employee Benefits and Executive Compensation under the New
Code
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
Fundamentals of Corporate Bankruptcy and Restructuring
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
Healthcare Bankruptcy Reforms
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
High-Yield Opportunities in Distressed Investing
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
Homestead Exemptions under BAPCPA
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
Privacy Rights, Protections & Pitfalls in Bankruptcy
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
Reverse Mergers-the New IPO?
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
Surviving the Digital Deluge: Best Practices in E-Discovery
and Records Management for Bankruptcy Practitioners and
Litigators
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
Validating Distressed Security Portfolios: Year-End Price
Validation and Risk Assessment
Contact: http://www.beardaudioconferences.com
240-629-3300
BEARD AUDIO CONFERENCES
When Tenants File -- A Landlord's BAPCPA Survival Guide
Contact: http://www.beardaudioconferences.com
240-629-3300
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, Melvin C. Tabao, Rizande
B. Delos Santos, Cherry A. Soriano-Baaclo, Ronald C. Sy, 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 ***