/raid1/www/Hosts/bankrupt/TCR_Public/070102.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Tuesday, January 2, 2007, Vol. 11, No. 1
Headlines
ADVANCED MARKETING: Files Chapter 11 Petition in Delaware
AEGIS ASSET: S&P Lowers Rating on Class B-1 Securities to B
AGILENT TECHNOLOGIES: Earns $3.3 Billion in Year Ended Oct. 31
AIR CANADA: Pilots Mulls Options After Interim Injunction Denial
AJAY SPORTS: Adverse Jury Decision Prompts Chapter 11 Filing
AJAY SPORTS: Case Summary & 36 Largest Unsecured Creditors
ALPHARX INC.: Schwartz Levitsky Raise Going Concern Doubt
ANALYTIC SURVEYS: Pannell Kerr Forster Raises Substantial Doubt
ARGO-TECH CORP: Eaton Merger Deal Prompts S&P's Positive Watch
ARTER & HADDEN: Former Partners Agree to $9.25 Million Settlement
AT HOLDINGS: Eaton Merger Deal Prompts S&P's Positive Watch
BALLY TOTAL: Generates $13.5 Million from Sale/Leaseback Deals
BOMBARDIER INC: Wins $569 Million Contract from Netherlands
CALPINE CORP: Canadian Debtors Oppose Greenfield Transaction
CALPINE CORP: Inks Third Amended DIP Facility with Credit Suisse
CARAUSTAR INDUSTRIES: Retains Iowa Recycled Boxboard Mill
CELL THERAPEUTICS: Amends Financing Pact with Societe Generale
COMCAM INC: Reports Zero Revenues in Quarter Ended September 30
COMVERSE TECHNOLOGY: S&P Retains Negative Watch on BB- Ratings
CPI INTERNATIONAL: Moody's Holds Caa1 Rating on $800 Million Notes
DATALOGIC INT'L: Sept. 30 Balance Sheet Upside-Down by $2 Million
DURA AUTO: Intercompany Claims Considered Admin. Priority Expense
DURA AUTOMOTIVE: Wants E&Y to Provide Tax Advisory Services
DURA AUTOMOTIVE: Wants to Employ Deloitte as Tax Consultants
ENTERGY NEW ORLEANS: Market Street Sale Draws Mixed Emotions
ENTERGY NEW ORLEANS: Roderick West Appointed as New Pres. & CEO
FEDERAL-MOGUL: DeVlieg's Claim Not Allowed as Admin. Expense
FEDERAL-MOGUL: Can Sell Allentown Property to Seagis for $6.6 Mil.
FELLOWS ENERGY: Incurs $1.06 Mil. Net Loss in Qtr. Ended Sept. 30
FOAMEX INTERNATIONAL: Class 9 and 10 Ballots Due on January 18
FOAMEX INTERNATIONAL: Court Okays Disclosure Statement Supplement
FORCHHEIMER & CO: SIPC Conducting Inventory of Assets
FREEDOM PACKAGING: Files for Bankruptcy Protection in New York
GB HOLDINGS: Court Approves Panel's Amended Disclosure Statement
GLIMCHER REALTY: Prepays Mortgage Debt on University Mall Property
GLOBAL POWER: Court Okays Blackstone Group as Financial Advisor
GLOBAL POWER: Wants April 18 Set as General Claims Bar Date
HOLLINGER INC: Lord Black Seeking $20.4 Million in Damages
HOST AMERICA: Sept. 30 Balance Sheet Upside-Down by $3.4 Million
INNOVA ROBOTICS: Sept. 30 Balance Sheet Upside-Down by $5.1 Mil.
INROB TECH: Posts $269,434 Net Loss in Quarter Ended Sept. 30
IVI COMMUNICATIONS: Sept. 30 Balance Sheet Upside-Down by $803,069
KLEROS PREFERRED: Moody's Rates to $10 Million Notes at Ba3
LASERLIGHT INC: Sept. 30 Balance Sheet Upside-Down by $3.9 Million
LACERTA ABS: Moody's Rates $40 Mil. Class E Secured Notes at Ba2
LEVEL 3: Completes Offering for $650 Mil. of 9.25% Senior Notes
LEVEL 3: Gets Requisite Consents in 10.75% Notes' Tender Offer
LIBERTY MEDIA: S&P Affirms BB+ Ratings and Removes Negative Watch
LIONBRIDGE TECH: Refinancing Prompts S&P to Withdraw Ratings
MAJESTIC STAR: Sept. 30 Balance Sheet Upside-Down by $130 Million
MERIDIAN AUTOMOTIVE: Emerges from Chapter 11 Protection
MM2 GROUP: Incurs $1.3 Million Net Loss in 2006 First Quarter
MOHEGAN TRIBAL: Sept. 30 Balance Sheet Upside-Down by $38.9 Mil.
MONEY CENTERS: Completes New $7.25 Million Credit Facility
NANTUCKET CLO: Moody's Rates $12.6 Million Notes at Ba2
NEOPLAN USA: Court Confirms Chapter 11 Plan of Reorganization
NORD RESOURCES: Platinum Merger Didn't Close on December 22
NORD RESOURCES: Receives $670,000 from Claims Settlements Proceeds
PILGRIM'S PRIDE: Closes Tender Offer for 88.87% Gold Kist Shares
POWER EFFICIENCY: Posts $1.1 Mil. Net Loss in FY 2006 3rd Quarter
ROWE COMPANIES: Court OKs Lexington-Rowe as Stalking-Horse Bidder
SEAGATE TECH: Signs Definitive Pact to Buy EVault for $185 Million
TANK SPORTS: Forms Strategic Alliance with Long SA de C.V.
TERAX ENERGY: Posts $12.1 Million Net Loss in 2006 First Quarter
THOMAS EQUIPMENT: Units Submit Plan of Arrangement Under CCAA
TRANSATLANTIC PETROLEUM: Sells Bayou Couba Assets to Dune Energy
WASHINGTON MUTUAL: S&P Junks Rating on Class L-B-5 Certificates
* A.M. Best Changes B++ and B+ Rating Descriptor on Insurance Cos.
* Large Companies with Insolvent Balance Sheets
*********
ADVANCED MARKETING: Files Chapter 11 Petition in Delaware
---------------------------------------------------------
Advanced Marketing Services, Inc., filed a voluntary petition
under Chapter 11 of the Federal Bankruptcy Code in United States
Bankruptcy Court for the District of Delaware. The Chapter 11
proceeding does not include the company's international
subsidiaries in the United Kingdom, Mexico and Australia, and
their operations will not be affected.
The company also disclosed that, in conjunction with the filing,
it has entered into a loan agreement for $75 million in Debtor-in-
Possession financing from Wells Fargo Foothill, Inc., subject to
court approval. The DIP financing should provide sufficient
liquidity to meet the Company's ongoing operating needs during the
proceeding.
During the past few months, the company explored a number of
alternatives to strengthen the Company's financial base and
resolve past legal and regulatory issues. Despite making some
progress, the company was unable to secure new financing and the
current loan facility, which is used to finance the company's
operations, will not be extended beyond Dec. 28, 2006.
"This move will permit AMS, with its investment banker, to
continue to pursue strategic alternatives," said Gary M.
Rautenstrauch, President and Chief Executive Officer.
"Additionally, Chapter 11 protection will enable the Company to
continue to conduct business in the normal course, make payments
to vendors going forward and continue delivering quality service
and products to customers."
The DIP financing should provide sufficient liquidity to meet the
company's ongoing operating needs during the proceeding; and
Chapter 11 protection will enable the company to continue to
conduct business in the normal course, make payments to vendors
going forward and continue to deliver quality service and products
to customers.
About Advanced Marketing Services
Based in San Diego, California, Advanced Marketing Services, Inc.
(Pink Sheets: MKTS) -- http://www.advmkt.com/-- provides
customized merchandising, wholesaling, distribution and publishing
services, currently primarily to the book industry. The company
has operations in the U.S., Mexico, the United Kingdom and
Australia and employs approximately 1,200 people worldwide.
AEGIS ASSET: S&P Lowers Rating on Class B-1 Securities to B
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on the B-1
class issued by Aegis Asset Backed Securities Trust's series
2003-1 to 'B' from 'BB' and left it on CreditWatch with negative
implications, where it was placed Sept. 8, 2006.
Concurrently, the 'A' rating on the M-2 class was placed on
CreditWatch with negative implications, and the ratings on the A-1
and M-1 classes were affirmed.
The rating actions on classes B-1 and M-2 are based on pool
performance that has allowed monthly realized losses to outpace
monthly excess interest for the past six months. During this
period, monthly losses have averaged approximately $214,000, while
monthly excess spread has averaged approximately $102,000. This
performance has allowed the overcollateralization (O/C) percentage
to fall below its target level of 0.50% of the original pool
balance. Currently, the O/C amount is $303,000, which is 0.11% of
the original pool balance.
Standard & Poor's will continue to closely monitor the performance
of the M-2 class. If the monthly realized losses decline to a
point where they no longer exceed monthly excess interest, and the
level of O/C has not been further eroded, the rating on this class
will be affirmed and removed from CreditWatch. Conversely, if the
O/C level continues to decline, further negative rating actions
can be expected.
The rating affirmations are based on credit support percentages
that are sufficient to maintain the current ratings on the
certificates. Credit enhancement for this transaction is provided
through a combination of O/C, excess interest, and subordination
of the junior classes.
Cumulative loss in this transaction is 2.46% of the original pool
balance. Ninety-plus-day delinquencies (including REOs and
foreclosures) are 28.97% of the current pool balances.
The underlying collateral for these certificates is mostly
conventional, first-lien, adjustable- or fixed-rate, fully-
amortizing and balloon residential mortgage loans. The mortgage
loans were originated in accordance with underwriting guidelines
that target nonconforming loans or subprime mortgage loans.
Rating lowered and remaining on creditwatch negative:
Aegis Asset Backed Securities Trust
Rating
------
Series Class To From
------ ----- -- ----
2003-1 B-1 B/Watch Neg BB/Watch Neg
Rating placed on creditwatch negative:
Aegis Asset Backed Securities Trust
Rating
------
Series Class To From
------ ----- -- ----
2003-1 M-2 A/Watch Neg A
Ratings affirmed:
Aegis Asset Backed Securities Trust
Series Class Rating
------ ----- ------
2003-1 A-1 AAA
2003-1 M-1 AA
AGILENT TECHNOLOGIES: Earns $3.3 Billion in Year Ended Oct. 31
--------------------------------------------------------------
Agilent Technologies Inc. reported $3.3 billion of net income on
$5 billion of net revenues for the year ended Oct. 31, 2006,
compared with $327 million of net income on $4.7 billion of
revenues for the fiscal year ended Oct. 31, 2005.
In the bio-analytical business, net revenue in 2006 increased
nine percent in comparison to 2005. Demand increased across all
markets in bio-analytical measurement with strongest growth
occurring in biotechnology solutions. In the electronic
measurement business, net revenue in 2006 increased 5 percent in
comparison to 2005. The electronic measurement business saw
growth in the general purpose segments, led by aerospace/defense
and semiconductor design and manufacturing.
The $3.3 billion 2006 net income included the income from and gain
on sale of the semiconductor products business for $1.8 billion
and the sale of the company's investment in Lumileds Lighting
International for a gain of $901 million.
At Oct. 31, 2006, the company's balance sheet showed $7.4 billion
in total assets, $3.7 billion in total liabilities, and
$3.6 billion in total stockholders' equity.
Full-text copies of the company's consolidated financial
statements for the year ended Oct. 31, 2006, are available for
free at http://researcharchives.com/t/s?17cc
Operating Cash Flows
In 2006, the company generated operating cash flows of
$431 million and had a cash and cash equivalent balance as of
Oct. 31, 2006 of $2.3 billion. In 2005, the company generated
operating cash flows of $656 million and had a cash and cash
equivalent balance as of Oct. 31, 2005 of $2.2 billion.
Significant Events in Fiscal 2006
In November 2005, the company finalized the sale of its investment
in Lumileds Lighting International to Philips for $949 million
plus the repayment of $51 million of the outstanding principal
debt and interest due to the company.
In December 2005, the company sold its semiconductor products
business to Avago Technologies Ltd. The company received
approximately $2.6 billion in cash proceeds.
In October 2006, the company completed the spin-off of its
semiconductor test solutions business. The aggregate market value
of ordinary shares distributed to Agilent stockholders was
approximately $840 million.
In June 2006, the company completed a stock repurchase program of
$4.466 billion of its common stock and in September 2006 the
company commenced another stock repurchase program for up to
$2 billion dollars, to be completed over the next 2 years.
About Agilent Technologies
Agilent Technologies Inc. (NYSE: A) -- http://www.agilent.com/--
is the world's premier measurement company and a technology leader
in communications, electronics, life sciences and chemical
analysis. The company's 19,000 employees serve customers in more
than 110 countries.
* * *
As reported in the Troubled Company Reporter on Dec. 13, 2006,
Moody's Investors Service upgraded both the corporate family
rating and probability of default rating of Agilent Technologies
Inc. to Ba1 from Ba2 and revised the outlook to positive. In
addition, Moody's also affirmed the company's speculative grade
liquidity rating at SGL-1.
AIR CANADA: Pilots Mulls Options After Interim Injunction Denial
----------------------------------------------------------------
The Air Canada Pilots are examining all options open to them in
light of the decision by the Ontario Superior Court not to grant a
request for an interim injunction to prevent ACE Aviation Holdings
Inc. from distributing $2-billion to its shareholders. The Court
will release the reasons for its decision at a later date. The
motion for the injunction was filed on Oct. 30, 2006.
"When we filed our lawsuit, we stated that we feared the
distribution as proposed would weaken the company and decrease its
ability to withstand a downturn in the economy," says Capt. Andy
Wilson, president of the Air Canada Pilots Association. "We have
felt all along that the company's plan unfairly disregards the
legitimate interests of Air Canada's creditors and we will
continue to pursue every option available to ensure that these
interests are protected."
Air Canada's pilots filed a lawsuit on Oct. 4 against ACE Aviation
under Section 241 of the Canadian Business Corporations Act,
commonly known as the 'oppression remedy.' This section of the
Act states that a company is not permitted to take actions that
unfairly disregard the interests of creditors.
The suit claims that the proposed distribution of up to $2-billion
to shareholders is oppressive to Air Canada's creditors, of which
the pilots are one through the over $1-billion in pension
obligations that remain outstanding following the company's
emergence from insolvency in 2004.
The lawsuit also challenges the ways in which ownership of Jazz
Air and Aeroplan limited partnerships were transferred from Air
Canada to ACE, as well as the values received by Air Canada for
those companies. In addition, the pilots' suit is challenging the
non-arms-length contracts between Air Canada and each of these
entities, which the pilots say also, causes an unfair burden on
Air Canada.
Capt. Wilson said that the pilots are very concerned about the
$850-million distribution announced by ACE Aviation on Dec. 28,
2006.
"Air Canada has shown it can prosper in good times," Capt. Wilson
adds. "We remain concerned that any large depletion of capital
will reduce our ability to weather a downturn in the economy, or
other external events. The lawsuit remains in place and we will
make a decision in the coming weeks on how to proceed."
Air Canada Pilots Association is the largest professional pilot
group in Canada, representing 3,100 pilots who operate Air
Canada's mainline fleet.
About Air Canada
Based in Montreal, Quebec, Air Canada -- http://www.aircanada.com/
-- with Air Canada Jazz and other business units of parent company
ACE Aviation Holdings Inc. -- http://www.aceaviation.com/--
provides scheduled and charter air transportation for passengers
and cargo to more than 150 destinations, vacation packages to over
90 destinations, as well as maintenance, ground handling and
training services to other airlines.
Air Canada filed for CCAA protection on April 1, 2003 (Ontario
Superior Court of Justice, Case No. 03-4932) and filed a Section
304 petition in the U.S. Bankruptcy Court for the Southern
District of New York (Case No. 03-11971). Mr. Justice Farley
sanctioned Air Canada's CCAA restructuring plan on Aug. 23, 2004.
Sean F. Dunphy, Esq., and Ashley John Taylor, Esq., at Stikeman
Elliott LLP, in Toronto, serve as Canadian Counsel to the carrier.
Matthew A. Feldman, Esq., and Elizabeth Crispino, Esq., at Willkie
Farr & Gallagher, serve as the Debtors' U.S. Counsel. When the
Debtors filed for protection from their creditors, they listed
CDN$7,816,000,000 in assets and CDN$9,704,000,000 in liabilities.
On Sept. 30, 2004, Air Canada successfully completed its
restructuring process and implemented its Plan of Arrangement.
The airline exited from CCAA protection raising CDN$1.1 billion of
new equity capital.
* * *
In April 2006, Standard & Poor's Ratings Services raised the long-
term corporate credit rating on ACE Aviation Holdings Inc. to 'B+'
from 'B', while affirming the 'B' long-term corporate credit
rating on its wholly owned subsidiary, Air Canada. The outlook on
both entities remains stable.
AJAY SPORTS: Adverse Jury Decision Prompts Chapter 11 Filing
------------------------------------------------------------
Ajay Sports Inc. and its affiliated companies including Pro Golf
of America, Inc., filed for Chapter 11 reorganization with the
U.S. Bankruptcy Court for the Eastern District of Michigan on
Dec. 27, 2006.
The filing for Chapter 11 protection, was due to the adverse
decision, resulting $1,320,168 award, reached by an Oakland
County, Michigan jury, on Oct. 6, 2006, in the wrongful
termination case of Ronald N. Silberstein v. Ajay Sports Inc. and
affiliates. The company has filed an appeal with the State of
Michigan Court of Appeals.
The adverse verdict resulted in the awarding to the Plaintiff of
$850,000 plus $470,168 in legal fees, court cost and statutory
interest, for a total of $1,320,168. The company strongly
disagrees with the jury's conclusions and expects a positive
result on the Appeal.
The company says that there will be no change in the day-to-day
activities of Ajay Sports, Pro Golf International, Pro Golf of
America and affiliates, as the appeal process proceeds.
Restructuring plans for Ajay Sports will be submitted to the
Bankruptcy Court. Ajay Sports is confident that a restructuring
plan should be approved and anticipates that the business of Pro
Golf of America will continue on a profitable basis.
The company also says that the filing of Chapter 11 reorganization
has no impact on the contractual relationship of franchisees.
Related to the process, Brian Donnelly has resigned as president
and chief operating officer of Pro Golf of America, Inc. But has
agreed to remain available for consultation regarding Pro Golf of
America's business.
About Pro Golf America
Founded in 1962, Pro Golf of America, Inc. ---
http://www.progolfamerica.com/-- and -- http://www.progolf.com/
-- is a golf franchiser. The company has a total of 107 privately
owned and operated franchised Pro Golf retail stores operating in
the United States, Canada, Puerto Rico and Ireland. The company
also sells sporting goods, in addition to golf equipment and
attire.
Pro Golf of America, Inc. is owned by Pro Golf International,
Inc., a holding company, which is owned by Ajay Sports, Inc.
About Ajay Sports
With administrative office at Farmington Hills, Michigan, Ajay
Sports, Inc., (Pink Sheets: AJAY) operates the franchise segment
of its business through Pro Golf International, Inc., a 97% owned
subsidiary, which was formed during 1999 and owns 100% of the
outstanding stock of Pro Golf of America, Inc., and 80% of the
stock of ProGolf.com, Inc. Pro Golf of America, Inc. is the
franchisor of Pro Golf / Pro Golf DiscountO retail golf stores.
ProGolf.com is a company formed to help drive traffic to its
franchisee stores and to sell golf equipment and other golf-
related and sporting goods products and services over the
Internet.
AJAY SPORTS: Case Summary & 36 Largest Unsecured Creditors
----------------------------------------------------------
Lead Debtor: Ajay Sports, Inc.
37735 Enterprise Court, Suite 600
Farmington, MI 48331
Bankruptcy Case No.: 06-59289
Debtor affiliates filing separate chapter 11 petitions:
Entity Case No.
------ --------
ProGolf International, Inc. 06-59290
ProGolf of America, Inc. 06-59291
ProGolf.com, Inc. 06-59292
Type of Business: Ajay Sports operates the franchise segment of
its business through Pro Golf International,
a 97% owned subsidiary, which was formed during
1999 and owns 100% of the outstanding stock of
Pro Golf of America, and 80% of the stock of
ProGolf.com.
Pro Golf of America, Inc. is the franchisor of
Pro Golf / Pro Golf DiscountO retail golf
stores. ProGolf.com is a company formed to help
drive traffic to its franchisee stores and to
sell golf equipment and other golf-related and
sporting goods products and services over the
Internet.
Chapter 11 Petition Date: December 27, 2006
Court: Eastern District of Michigan (Detroit)
Judge: Phillip J. Shefferly
Debtor's Counsel: Arnold S. Schafer, Esq.
Howard M. Borin, Esq.
Schafer and Weiner, PLLC
40950 Woodward Avenue, Suite 100
Bloomfield Hills, MI 48304
Tel: (248) 540-3340
Fax: (248) 642-2127
Financial Condition as of Sept. 30, 2006:
Estimated Assets Estimated Debts
---------------- ---------------
Ajay Sports, Inc. Less than $10,000 $1 Million to
$100 Million
ProGolf International, Less than $10,000 $1 Million to
Inc. $100 Million
ProGolf of America, Less than $10,000 $1 Million to
Inc. $100 Million
ProGolf.com, Inc. Less than $10,000 $1 Million to
$100 Million
A. Ajay Sports, Inc.'s Seven Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Thomas W. Itin Note $2,287,073
4831 Old Orchard Trail
West Bloomfield, MI 48324
Ronald N. Silberstein, Judgment $1,320,168
CPA, PLLC
30201 Orchard Lake Road,
Suite 150
Farmington, MI 48334
First Equity Corporation Note $751,819
37735 Enterprise Court
Suite 600-B
Farmington, MI 48331
Thomas W. Itin Note $389,951
4831 Old Orchard Trail
West Bloomfield, MI 48324
Acrodyne Corporation Note $190,732
37735 Enterprise Court
Suite 600-B
Farmington, MI 48331
First Equity Corporation Note $66,200
37735 Enterprise Court
Suite 600-B
Farmington, MI 48331
DLA Piper Rudnick Gray Cary $43,961
US LLP
203 North LaSalle Street
Suite 1900
Chicago, IL 606011293
B. ProGolf International, Inc.'s Eight Largest Unsecured
Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Comerica Bank $3,801,786
P.O. Box 641618
Detroit, MI 482641618
Thomas W. Itin $2,650,298
4831 Old Orchard Trail
West Bloomfield, MI 48324
1001 Woodward, Inc. $1,807,317
37735 Enterprise Court
Suite 600-B
Farmington, MI 48331
Ronald N. Silberstein, Judgment $1,320,168
CPA, PLLC
30201 Orchard Lake Road
Suite 150
Farmington, MI 48334
Henry Hooker $870,083
370 Vaughn Road
Nashville, TN 37221
Bradford Hooker $549,958
c/o Henry Hooker
370 Vaughn Road
Nashville, TN 37221
Timothy Hooker $549,958
3150 Hickstead Place
West Palm Beach, FL 33414
Maddin Hauser Professional $13,491
P.O. Box 215 Services
Southfield, MI 480370215
C. ProGolf of America, Inc.'s 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Ronald N. Silberstein, Judgment $1,320,168
CPA, PLLC
30201 Orchard Lake Road
Suite 150
Farmington, MI 48334
DLA Piper Rudnick Gray Cary Trade Payable $110,562
US LLP
203 North LaSalle Street
Suite 1900
Chicago, IL 606011293
Jeffrey Meek, Esq. Trade Payable $52,508
38705 West Seven Mile Road
Suite 400
Livonia, MI 48152
Glast, Philips & Munay $50,000
2200 One Galleria Tower
13355 Noel Road L.B. 48
Dallas, TX 752401518
Alfred & Elizabeth Gilbert, Franchise Deposit $49,500
Jr. Owed
Nashua, NH
Thomas Jr. & Kathleen Dodgen Franchise Deposit $49,500
Owed
Auburn, AL
Glast, Phillips & Murray Trade Payable $38,554
Mars Marketing $38,500
UHY, LLP $36,250
Mars Advertising Trade Payable $36,000
Marie Rainwater Trade Payable $10,000
c/o Glast, Phillips & Murray
Dykema Gossett PLLC Trade Payable $7,898
Plunkett & Cooney Trade Payable $6,365
Quantum Graphics, Inc. Trade Payable $5,480
Scout & Christina Trim Trade Payable $5,000
Donald & Dana Lucas Franchise Deposit $5,000
Owed
Silversprings, MD
Nancy Jo Martin Franchise Deposit $5,000
Owed
Gallatin, TN
Eric A. Mashlan Franchise Deposit $5,000
Owed
Honolulu, HI
UHY LLP, MI Trade Payable $4,732
Pro Golf of Bend Marketing monies $2,716
owed to franchises
D. ProGolf.com, Inc.'s Largest Unsecured Creditor:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Ronald N. Silberstein, Judgment $1,320,168
CPA, LLC
30201 Orchard Lake Road,
Suite 150
Farmington, MI 48334
ALPHARX INC.: Schwartz Levitsky Raise Going Concern Doubt
---------------------------------------------------------
Schwartz Levitsky Feldman LLP, in Toronto, Ontario, Canada,
expressed substantial doubt about AlphaRx Inc.'s ability to
continue as a going concern after auditing the company's financial
statements for the fiscal years ended Sept. 30, 2006, and 2005.
The auditing firm pointed to the company's recurring losses from
operations.
ALPHARx Inc. reported a $2.5 million net loss on $1 million of
revenues for the year fiscal year ended Sept. 30, 2006, compared
with a $4.9 million net loss on $4,302 of revenues for the same
period in 2005.
The majority of revenues for the year ended Sept. 30, 2006 were
derived from license fees received from one of the company's
partners. For the year ended Sept. 30, 2005, the company derived
revenues from royalties generated by Indaflex sales in Mexico.
The decrease in net loss is mainly due to the increase in
revenues, the $739,522 decrease in operating expenses, and the
$626,735 decrease in loss from operations of discontinued
component, partly offset by the $90,214 increase in net other
expenses.
At Sept. 30, 2006, the company's balance sheet showed $1.5 million
in total assets, $1.4 million in total liabilities, and $161,283
in minority interest, resulting in a $54,732 total stockholders'
equity.
The company's balance sheet at Sept. 30, 2006, also showed
strained liquidity with $1.2 million in total current assets
available to pay $1.4 million in total current liabilities.
Full-text copies of the company's financial statements for the
year ended Sept. 30, 2006, are available for free at:
http://researcharchives.com/t/s?17c4
About AlphaRx Inc.
AlphaRx Inc. (OTC BB: ALRX.OB) -- http://www.alpharx.com/-- is a
clinical stage biopharmaceutical company utilizing proprietary
drug delivery technology to develop novel formulations of drugs
that are insoluble or poorly soluble in water or have yet to be
administrable to the human body with an acceptable delivery
method. The company's product candidates address various
pharmaceutical markets, including arthritis, tuberculosis, ocular
infection and inflammation, cataracts, hospital acquired pneumonia
and sepsis.
In August 2003, the company licensed Indaflex, its lead
pharmaceutical product under development, to Industria
Farmaceutica Andromaco, S.A. de C.V. for commercialization in
Mexico.
ANALYTIC SURVEYS: Pannell Kerr Forster Raises Substantial Doubt
---------------------------------------------------------------
Pannell Kerr Forster of Texas, P.C., in Houston, Texas, expressed
substantial doubt about Analytic Survey Inc.'s ability to continue
as a going concern after auditing the company's financial
statements for the year ended Sept. 30, 2006. The auditing firm
pointed to the company's significant operating losses in 2006 and
prior years. The firm also cited that the company does not
currently have external financing in place to fund working capital
requirements.
Analytic Survey Inc. reported a $335,000 net loss on $4.3 million
of revenues for the fiscal year ended Sept. 30, 2006, compared
with a $3.3 million net loss on $6.1 million of revenues for
fiscal year 2005.
The lower net loss in fiscal 2006 was a result of improved
management of project cost and schedule performance in 2006,
streamlined executive management, reduction of general and
administrative expenses, and the sale of assets related to the
Wisconsin production center.
Revenues decreased $1.7 million to $4.3 million for fiscal 2006
from $6.1 million for fiscal 2005. The decrease in revenues is
due to a lower number of active contracts in the fiscal 2006
period and the sale assignment of several ongoing contracts to
RAMTeCH Software Solutions Inc. on Aug. 1, 2006, which had the
effect of reducing revenue during the fourth quarter of fiscal
2006.
Salaries, wages and benefits decreased 48.8% to $2.7 million for
fiscal 2006 from $5.3 million for fiscal 2005. The decrease was a
result of reductions in workforce related to reduced revenue
volume and fewer administrative employees.
Interest expense increased to $177,000 for fiscal 2006 from
$78,000 in fiscal year 2005. The higher interest expense was a
result of the higher 14% rate of interest and amortization of the
discount on the senior notes during fiscal 2006 compared to the 7%
rate of interest on the note which was outstanding during fiscal
2005.
The company recognized a gain on extinguishment of debt totaling
$61,000 related to the relinquishment of accrued dividends by the
holders of the company's series A redeemable preferred stock. On
Feb. 1, 2006, the company issued 318,000 shares of common stock in
exchange for the outstanding shares of the preferred stock, which
had a carrying value of approximately $269,000 and a current
redemption price of $299,583. The transaction eliminated all of
the obligations related to the preferred stock, including
approximately $61,000 of accrued dividends, the right to which was
relinquished by the holders as part of the transaction.
At Sept. 30, 2006, the company's balance sheet showed $5 million
in total assets, $2.5 million in total liabilities, and
$2.5 million in total stockholders' equity.
Full-text copies of the company's consolidated financial
statements for the year ended Sept. 30, 2006, are available for
free at http://researcharchives.com/t/s?17c6
About Analytic Surveys
Headquartered in San Antonio, Texas, Analytical Surveys Inc. --
http://www.anlt.com/ -- provides technology-enabled solutions and
expert services for geospatial data management, including data
capture and conversion, planning, implementation, distribution
strategies and maintenance services. Through its affiliates, ASI
has played a leading role in the geospatial industry for more than
40 years. The company is dedicated to providing utilities and
government with responsive, proactive solutions that maximize the
value of information and technology assets. ASI maintains
operations in Waukesha, Wisconsin.
ARGO-TECH CORP: Eaton Merger Deal Prompts S&P's Positive Watch
--------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on Argo-Tech
Corp. and its parent, AT Holdings Corp., including the 'B+'
corporate credit ratings on both companies, on CreditWatch with
positive implications.
"The CreditWatch placement follows the announcement that AT
Holdings and Argo-Tech will be acquired by Eaton Corp.
[A/Stable/A-1] for $695 million," Standard & Poor's credit analyst
Christopher DeNicolo, said.
The transaction does not include Argo-Tech's cryogenics and other
nonaerospace businesses, which comprised about 10% of fiscal 2006
(ended Oct. 28, 2006) revenues. The acquisition is expected to
close in the first quarter of calendar 2007 and is subject to
customary regulatory approvals. Standard & Poor's will likely
withdraw its ratings if all rated debt is repaid.
Argo-Tech supplies main engine fuel pumps, which are used in
approximately 60% of large commercial aircraft in service.
The firm also has positions in commercial and military airframe
fuel pumps and valves, aerial refueling components installed on
U.S. military aircraft, and components for ground fueling systems
for major commercial airports. In addition, the company provides
cryogenic pumps and other components to the liquefied natural gas
industry.
ARTER & HADDEN: Former Partners Agree to $9.25 Million Settlement
-----------------------------------------------------------------
Marc P. Gertz, Trustee for Arter & Hadden's Chapter 7 case, and
more than 70 former partners and their new law firms, and insurers
of the former law firm have reached a settlement of the claims
made in a 16-count complaint filed by the Trustee in the U.S.
Bankruptcy Court for the Northern District of Ohio.
The settlement, which still requires approval by Court, calls for
the defendants and their insurers to pay $9.25 million to the
Trustee. The amount is in addition to settlements reached with
more than 50 other former partners, totaling over $1 million, and
does not include claims against approximately 66 additional
partners who were not part of the settlement agreement.
Mr. Gertz was appointed as Chapter 7 Trustee in January 2004 and
conducted an 18-month investigation into the cause of the firm's
demise. The investigation by Mr. Gertz, his attorneys and
forensic and information technology experts led to the filing of
the complaint, which alleged improper year-end compensation
distributions to the partners and other misconduct.
According to Mr. Gertz, the settlement proceeds will be utilized,
along with other funds collected by him, to pay creditors.
"The negotiations that led to the settlement were difficult but
productive," Mr. Gertz, said.
Mr. Gertz is in the case by Robert M. Gippin, Irving B. Sugerman
and Michael A. Steel from the Akron-based law firm of Goldman &
Rosen, Ltd. and by Robert S. Bernstein and Charles E. Bobinis of
the Bernstein Law Firm, P.C. of Pittsburgh, Pa.
About Arter & Hadden
Cleveland-based law firm, Arter & Hadden, closed its doors on
July 15, 2003, owing millions of dollars in pension obligations
and other debts to creditors. It began an aggressive expansion
through an acquisition program in the 1990s. Once a regional firm
of 70 lawyers, Arter grew to 12 offices, 465 lawyers and 178
partners in Ohio, Texas, California and Washington, D.C.
AT HOLDINGS: Eaton Merger Deal Prompts S&P's Positive Watch
-----------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on Argo-Tech
Corp. and its parent, AT Holdings Corp., including the 'B+'
corporate credit ratings on both companies, on CreditWatch with
positive implications.
"The CreditWatch placement follows the announcement that AT
Holdings and Argo-Tech will be acquired by Eaton Corp.
[A/Stable/A-1] for $695 million," Standard & Poor's credit analyst
Christopher DeNicolo, said.
The transaction does not include Argo-Tech's cryogenics and other
nonaerospace businesses, which comprised about 10% of fiscal 2006
(ended Oct. 28, 2006) revenues. The acquisition is expected to
close in the first quarter of calendar 2007 and is subject to
customary regulatory approvals. Standard & Poor's will likely
withdraw its ratings if all rated debt is repaid.
Argo-Tech supplies main engine fuel pumps, which are used in
approximately 60% of large commercial aircraft in service.
The firm also has positions in commercial and military airframe
fuel pumps and valves, aerial refueling components installed on
U.S. military aircraft, and components for ground fueling systems
for major commercial airports. In addition, the company provides
cryogenic pumps and other components to the liquefied natural gas
industry.
BALLY TOTAL: Generates $13.5 Million from Sale/Leaseback Deals
--------------------------------------------------------------
Bally Total Fitness Holding Corporation closed on two additional
sale/leaseback transactions with respect to four properties,
generating approximately $13.5 million in net proceeds. On
Oct. 25, 2006, the company previously closed on a sale/leaseback
transaction with respect to four properties, generating
approximately $8.9 million in net proceeds.
"With the completion of these transactions, we satisfied the
senior credit facility requirement that Bally raise at least $20
million in additional liquidity by year-end," Don R. Kornstein,
Bally's interim Chairman, said. "These transactions mark another
significant milestone in Bally's ongoing efforts to recapitalize,
and we remain committed to further improving our financial
structure in 2007."
Based in Chicago, Illinois, Bally Total Fitness Holding Corp.
(NYSE: BFT) -- http://www.Ballyfitness.com/-- is a commercial
operator of fitness centers in the U.S., with nearly 390
facilities and 30 franchises and joint ventures located in 29
states, Mexico, Canada, Korea, China and the Caribbean. Bally
also sells Bally-branded apparel, nutritional products, fitness-
related merchandise and its licensed portable exercise equipment
is sold in more than 10,000 retail outlets.
* * *
As reported in the Troubled Company Reporter on Oct. 19, 2006,
Moody's Investors Service affirmed the Caa1 rating on Bally Total
Fitness Holding Corporation's $235 million 10.5% senior unsecured
notes (guaranteed) due 2011 and the Caa3 rating on the company's
$300 million 9.875% senior subordinated notes due 2007. The
rating outlook remains negative.
BOMBARDIER INC: Wins $569 Million Contract from Netherlands
-----------------------------------------------------------
Bombardier Inc. has received a $569 million deal to build 50
intercity trains for the Dutch National Railways, Gillian Wee
writes for Bloomberg.
According to Bloomberg, Bombardier will start delivering the
double-deck cars in June 2008. The construction of the vehicles
is located in Gorlitz and Aachen, Germany.
Bloomberg says that Bombardier's new blue-and-yellow subway cars
would join a fleet of 378 trains designed for intercity service in
Netherlands. 20,000 seats would be added to the system and would
feature an energy-saving propulsion mechanism.
In addition, Bloomberg states that for the past two months, the
company has won a $3.4 billion contract to provide commuter trains
to the Paris region. The company has brought in orders from
France's national railway and the Toronto Transit Commission,
Bloomberg adds.
About Bombardier
Headquartered in Valcourt, Quebec, Bombardier Inc. (TSX: BBD) --
http://www.bombardier.com/-- manufactures transportation
solutions, from regional aircraft and business jets to rail
transportation equipment.
* * *
As reported in the Troubled Company Reporter on Nov. 1, 2006,
Dominion Bond Rating Service confirmed the ratings of Bombardier
Inc. and Bombardier Capital Ltd. The Senior Unsecured Debentures
of both Bombardier Inc. and Bombardier Capital Ltd. are confirmed
at BB, and Preferred Shares of Bombardier Inc. at Pfd-4. All
trends are Negative.
In October 2006, Fitch Ratings downgraded the debt and Issuer
Default Ratings for both Bombardier Inc. The Company's issuer
default rating was downgraded from BB to BB-. Other rating
actions include, Senior unsecured debt revised to 'BB-' from 'BB';
Credit facilities revised to 'BB-' from 'BB' and Preferred stock
revised to 'B' from 'B+'. The Rating Outlook is Stable.
Also in October 2006, Standard & Poor's Ratings Services affirmed
its 'BB' long-term corporate credit rating on Bombardier. At the
same time, Standard & Poor's assigned its 'BB' issue rating to
Bombardier's proposed issuance of up to EUR1.8 billion seven-to-
ten-year multi-tranche senior unsecured notes.
Bombardier Inc.'s proposed EUR1.8 billion in new senior unsecured
notes carry Moody's Investors Service Ba2 rating.
CALPINE CORP: Canadian Debtors Oppose Greenfield Transaction
------------------------------------------------------------
The Canadian Debtors, Alliance Pipeline Limited Partnership and
Alliance Pipeline, L.P., Ernst & Young, Inc., as Court-appointed
monitor of certain Canadian Debtors, and Calpine Power, L.P.,
opposed the proposed Greenfield Transaction of Calpine Corp. and
its debtor-affiliates.
As reported in the Troubled Company Reporter on Dec. 18, 2006,
Calpine Corp. sought permission from the U.S. Bankruptcy Court for
the Southern District of New York to:
(a) take all actions and execute all documents necessary to
effectuate a Greenfield Financing Transaction, and other
related transactions with respect to the Greenfield
Partnership;
(b) permit Greenfield Commercial Trust to establish a new,
wholly owned subsidiary and transfer its 49.995% limited
partner interest in the Greenfield Partnership to the
newly created subsidiary; and
(c) assume, amend, and assign or otherwise transfer to the
Greenfield Partnership the Siemens Agreement whether
directly or through a series of transactions with Debtor
and non-Debtor subsidiaries of Calpine Corporation.
The Canadian Debtors argued that the proposed ratification of
prepetition transfers from Calpine Corporation to the Greenfield
Partnership prejudices their rights. They are concerned that the
U.S. Debtors intend to use the Bankruptcy Court to effect a
cleansing of the transfers that might otherwise be subject to
avoidance under applicable law.
The Canadian Debtors filed a motion seeking to reverse the
November 2005 Deal before the Honourable Madam Justice B.E.C.
Romaine of the Alberta Court of Queen's Bench.
The Canadian Debtors asserted that the transfer of 49.995% of the
Debtors' interest in the Greenfield Project for a mere $100 in
November 2005 constitutes a fraudulent transfer and is subject to
avoidance. Garry M. Graber, Esq., at Hodgson Russ, LLP, in New
York, argued that the transfer was made to delay, hinder and
prejudice creditors from asserting lawsuits against Calpine
Energy Services Canada, Ltd.
The Canadian Debtors and E&Y told the Court that the U.S. Debtors
have not consulted them regarding the Debtors' Greenfield
Transaction Motion.
Furthermore, the Objectors pointed out that the U.S. Debtors have:
-- not identified the prepetition transactions they seek to
ratify;
-- not presented any evidence concerning the propriety of the
transactions they ask the Bankruptcy Court to ratify;
-- not presented case law concerning the extraordinary and
far-reaching proposed ratification; and
-- concluded summarily and without consultation that
ratification of the transactions is in the best interests
of their creditors.
The Objectors pointed out that they cannot fully assess the
effects of the proposed transfer or the Court's ratification of
the prepetition transfers without a comprehensive review of facts.
Thus, the Objectors asserted that the Court should provide them
the opportunity to investigate the claims affected by the proposed
transactions before it considers the Debtors' requests. E&Y
suggested that a dialogue with the Debtors and other interested
parties would be a constructive first step to better understand
the Debtors' Greenfield Transaction Motion.
CPL, the largest creditor of the Canadian Debtors, said there is
no need to rush on the approval of the Motion since the deadline
for closing on the Greenfield transaction has been extended to
Feb. 2, 2007.
U.S. Debtors Respond
The U.S. Debtors asserted that they do not intend to intrude on
the Canadian Debtors' rights nor the Canadian Court's
jurisdiction.
To resolve the Objectors' concerns, the U.S. Debtors amended the
proposed order to:
(a) clarify that "Debtors" would mean the U.S. Debtors and
their estates;
(b) authorize them to elect to waive any avoidance actions
they may have with respect to the Greenfield Financing
Transaction; and
(c) provide that they will exercise their right to effect the
transfers only with the additional consent of the Official
Committee of Unsecured Creditors, the Official Committee
of Equity Security Holders, and the Unofficial Committee
of Second Lien Debtholders.
The U.S. Debtors maintained that the Bankruptcy Court has
exclusive jurisdiction over all of their legal and equitable
interests, thus only the Bankruptcy Court may authorize them to
consent to the transfer of the 50% ownership interest of Calpine
Energy Services Canada, Ltd., in the Greenfield Partnership.
David R. Seligman, Esq., at Kirkland & Ellis LLP, in New York,
related that CESCA is a wholly owned, indirect subsidiary of
Calpine Corp. and, therefore, the U.S. Debtors have various legal
and equitable interests related to CESCA, including the ability
to consent to the transfer of CESCA's 50% ownership interest in
the Greenfield Partnership.
The U.S. Debtors expect that the Greenfield Plant, once it
becomes commercially operational, will generate a healthy income
stream. The U.S. Debtors emphasize that there is a need to
obtain non-recourse, project level financing for the Greenfield
Plant to ensure that its construction remains on schedule. Also,
obtaining the financing will maximize the return on the U.S.
Debtors' equity investments in the Greenfield Plant, Mr. Seligman
notes.
To prevent dilution of their ownership interests in the
Greenfield Partnership, the U.S. Debtors must make additional
capital contributions, Mr. Seligman says.
Mr. Seligman avers that the U.S. Debtors are prepared to present
additional evidence via live testimony to the extent the
Bankruptcy Court believes that further evidence of the U.S.
Debtors' proper exercise of their business judgment is necessary.
About Calpine Corp.
Headquartered in San Jose, California, Calpine Corporation
(OTC Pink Sheets: CPNLQ) -- http://www.calpine.com/-- supplies
customers and communities with electricity from clean, efficient,
natural gas-fired and geothermal power plants. Calpine owns,
leases and operates integrated systems of plants in 21 U.S. states
and in three Canadian provinces. Its customized products and
services include wholesale and retail electricity, gas turbine
components and services, energy management and a wide range of
power plant engineering, construction and maintenance and
operational services.
The company previously produced a portion of its fuel consumption
requirements from its own natural gas reserves. However, in July
2005, the company sold substantially all of its remaining domestic
oil and gas assets to Rosetta Resources Inc.
The company filed for chapter 11 protection on Dec. 20, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-60200). Richard M. Cieri, Esq.,
Matthew A. Cantor, Esq., Edward Sassower, Esq., and Robert G.
Burns, Esq., Kirkland & Ellis LLP represent the Debtors in their
restructuring efforts. Michael S. Stamer, Esq., at Akin Gump
Strauss Hauer & Feld LLP, represents the Official Committee of
Unsecured Creditors. As of Dec. 19, 2005, the Debtors listed
$26,628,755,663 in total assets and $22,535,577,121 in total
liabilities. (Calpine Bankruptcy News, Issue No. 34; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
CALPINE CORP: Inks Third Amended DIP Facility with Credit Suisse
----------------------------------------------------------------
Calpine Corporation and its debtor-affiliates entered into a Third
Amendment on Dec. 20, 2006, to the Amended and Restated Revolving
Credit, Term Loan and Guarantee Agreement, dated as of
Feb. 23, 2006, with, among others, Credit Suisse Securities (USA)
LLC and Deutsche Bank Securities Inc., as joint syndication
agents.
In a regulatory filing with the Securities and Exchange
Commission, Calpine Senior Vice President and Chief Accounting
Officer Charles B. Clark, Jr., disclosed that pursuant to the
Third Amendment, the DIP Facility was amended to, inter alia:
a) permit certain liens to be granted to Calpine Generating
Company, LLC, pursuant to the Dec. 20, 2006, Court order
modifying the Cash Collateral Order;
b) permit adequate protection payments to holders of Calpine's
Second Priority Secured Floating Rate Notes Due 2007, 8-1/2%
Second Priority Senior Secured Notes Due 2010, 8-3/4% Second
Priority Senior Secured Notes Due 2013, 9-7/8% Second
Priority Senior Secured Notes Due 2011, and Senior Secured
Term Loans Due 2007;
c) reset the "Geysers Leverage Ratio" and the "Geysers Interest
Coverage Ratio", as those terms was defined in the DIP
Facility, for the months ended Dec. 31, 2006, through
Nov. 30, 2007;
d) eliminate the provision that would have required reduction
of the DIP Facility revolver commitment from $1 billion to
$750 million based on certain asset sale mechanics;
e) allow for future project financing at Otay Mesa Energy
Center, LLC;
f) permit the transfer by the Company to the Greenfield Project
Partnership of a purchase contract with Siemens Power
Generation, Inc., relating to warranties on turbines
transferred; and
g) permit the sale of certain of the Company's subsidiaries,
which are inactive or have de minimis assets.
About Calpine Corp.
Headquartered in San Jose, California, Calpine Corporation
(OTC Pink Sheets: CPNLQ) -- http://www.calpine.com/-- supplies
customers and communities with electricity from clean, efficient,
natural gas-fired and geothermal power plants. Calpine owns,
leases and operates integrated systems of plants in 21 U.S. states
and in three Canadian provinces. Its customized products and
services include wholesale and retail electricity, gas turbine
components and services, energy management and a wide range of
power plant engineering, construction and maintenance and
operational services.
The company previously produced a portion of its fuel consumption
requirements from its own natural gas reserves. However, in July
2005, the company sold substantially all of its remaining domestic
oil and gas assets to Rosetta Resources Inc.
The company filed for chapter 11 protection on Dec. 20, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-60200). Richard M. Cieri, Esq.,
Matthew A. Cantor, Esq., Edward Sassower, Esq., and Robert G.
Burns, Esq., Kirkland & Ellis LLP represent the Debtors in their
restructuring efforts. Michael S. Stamer, Esq., at Akin Gump
Strauss Hauer & Feld LLP, represents the Official Committee of
Unsecured Creditors. As of Dec. 19, 2005, the Debtors listed
$26,628,755,663 in total assets and $22,535,577,121 in total
liabilities. (Calpine Bankruptcy News, Issue No. 34; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
CARAUSTAR INDUSTRIES: Retains Iowa Recycled Boxboard Mill
---------------------------------------------------------
Caraustar Industries, Inc., disclosed the retention of its Tama,
Iowa coated recycled boxboard mill.
The company exited the balance of its CRB mill system earlier in
the year and Tama had been held for sale as part of the CRB group.
The employees at Tama have significantly improved both the
performance and profitability of the Tama mill throughout 2006,
the company says. Since the exit of its other CRB mills, the Tama
mill has been generating significant cash flow and the company
believes that it is in its best interest to retain the mill.
The results of the Tama mill and the company's two other CRB
mills, Sprague, Connecticut and Rittman, Ohio, will be
reclassified from discontinued operations to continuing
operations.
The company sold the Sprague mill and the coating components of
the Rittman mill during the third quarter of 2006. Results for
the Sprague and Rittman mills will be reclassified as continuing
operations only for the periods they were owned. In addition to
the reclassification, the company will also record a depreciation
charge of approximately $800,000 in the fourth quarter of 2006 to
recognize depreciation expense for the periods that the Tama mill
was held for sale and not depreciated.
The company further disclosed the completion of the exit of its
specialty packaging business. Facilities in Birmingham, Ala.;
Robersonville, N.C.; Bucyrus, Ohio; Strasburg, Ohio; and Clifton,
N.J. have all been sold or closed. Gross proceeds from all
transactions were $5.6 million, of which $4.9 million was received
in the fourth quarter 2006.
Headquartered in Austell, Ga., Caraustar Industries, Inc.
(NASDAQ-NGM: CSAR) -- http://www.caraustar.com--manufacturers
recycled paperboard, producing a wide variety of tubes, cores,
composite containers, folding cartons, and industrial and consumer
packaging.
* * *
As reported in the Troubled Company Reporter on Dec. 4, 2006
Moody's Investors Service affirmed Caraustar Industries, Inc.'s B2
corporate family rating and B3 senior unsecured rating. The
rating outlook remains stable.
CELL THERAPEUTICS: Amends Financing Pact with Societe Generale
--------------------------------------------------------------
Cell Therapeutics, Inc., entered into a third amendment to the
Step-Up equity financing agreement with Societe Generale.
The Amendment extends the term under which Societe Generale is
committed to purchase the company's common stock pursuant to the
terms of the Agreement to twenty-four months from the earlier of
(a) the filing of a listing prospectus admitting the Shares for
trading on the Milan Stock Exchange that has been authorized by
Borsa Italiana S.p.A. or (b) Jan. 31, 2007.
The company and Societe Generale have also determined that the
conditions set forth in Section 4.3(b) of the Agreement have been
satisfied and the company has paid to Societe Generale the
advisory fee as required by Section 8.1 of the Agreement.
Societe Generale is a French societe anonyme headquartered at
boulevard Haussmann, Paris, France
A full text-copy of Amendment No. 3 to the Step-Up Equity
Financing Agreement may be viewed at no charge at:
http://ResearchArchives.com/t/s?17c3
Based in Seattle, Washington, Cell Therapeutics, Inc.,
(NASDAQ and MTAX: CTIC) -- http://www.cticseattle.com/--
develops, acquires, and commercializes treatments for cancer. The
company was co-founded by James A. Bianco, Louis A. Bianco, and
Jack W. Singer in 1991.
At Sept. 30, 2006, Cell Therapeutics, Inc.'s balance sheet showed
total assets of $120.9 million, total convertible debt of
$168.4 million and a shareholders' deficit of $85.1 million.
Shareholders' deficit at Dec. 31, 2005 stood at $107 million.
COMCAM INC: Reports Zero Revenues in Quarter Ended September 30
---------------------------------------------------------------
Comcam Inc. reported a $3,727 net loss for the quarter ended
Sept. 30, 2006, compared with a $5,529 net loss for the same
period in 2005. The company had no revenues in both periods. The
company incurred no general and administrative expenses for the
quarter ended Sept. 30, 2006 and Sept. 30, 2005.
The net loss in both periods represent interest expense charges.
At Sept. 30, 2006, the company's balance sheet showed $1.5 million
in total assets, $201,250 in total liabilities, and $1.3 million
in total stockholders' equity.
The company's balance sheet at Sept. 30, 2006, also showed
strained liquidity with $9,535 in total current assets available
to pay $201,250 in total current liabilities.
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?17c0
Going Concern Doubt
Jones Simkins, PC, in Logan, Utah, expressed substantial doubt
about Comcam's ability to continue as a going concern after
auditing the company's financial statements for the year ended
Dec. 31, 2005. The auditing firm cited that the company's revenue
generating activities are not in place, and that the company had
incurred losses since inception.
* * *
Headquartered in West Chester, Pennsylvania, Comcam Inc.
-- http://www.com.cam.net/-- through its subsidiary Comcam
International Inc. is engaged in the development and sale of
internet protocol remote control platform cameras, micro-servers,
associated software, and unique end-to-end network solutions.
Internet Protocol is the procedure for regulating the transmission
of data over a network, be that a local area network or the
internet.
COMVERSE TECHNOLOGY: S&P Retains Negative Watch on BB- Ratings
--------------------------------------------------------------
Standard & Poor's Ratings Services said that it is leaving its
'BB-' corporate credit and senior unsecured debt ratings on New
York, N.Y.-based Comverse Technology Inc. on CreditWatch with
negative implications, where they were placed on March 15, 2006.
"The company recently announced that it has received a notice of
default and demand letter from the trustee of its convertible
notes citing the company's failure to file with the trustee its
form 10-K annual financial statement for the year ended
Jan. 31, 2006, or any subsequent form 10-Q quarterly financial
statements," Standard & Poor's credit analyst Ben Bubeck, said.
Comverse does not believe that a default has occurred under the
indenture, as the company has not yet filed these reports with the
SEC. It should be noted that the company reported cash balances
of nearly $1.9 billion as of Oct. 31, 2006, compared with
approximately $418 million of outstanding convertible notes.
Therefore, the company is expected to be able to meet a
potentially accelerated maturity with current balance sheet
liquidity, if necessary.
The ratings were originally placed on CreditWatch following the
company's announcement that its board of directors had created a
special committee to review matters relating to the company's
stock option grants, which has resulted in the ongoing delay of
the filing of financial statements, potential restatement of prior
periods, and departure of senior management.
S&P will continue to monitor developments with Comverse, including
financial restatements, changes to the strategy and corporate
governance practice that may stem from the management departures,
potential litigation, and debt maturity acceleration to determine
what, if any, affect they have on debt ratings.
CPI INTERNATIONAL: Moody's Holds Caa1 Rating on $800 Million Notes
------------------------------------------------------------------
Moody's Investors Service affirmed all of the ratings for CPI
International, Inc. and its principal operating subsidiary,
Communications and Power Industries, Inc., which affect
approximately $335 million of rated debt. The outlook remains
positive.
Moody's affirmed these ratings:
CPI International, Inc.:
- $80 million floating rate notes due 2015, at Caa1 (LGD5, 89%)
- Corporate Family Rating, at B2
- PDR, at B2
Communications & Power Industries, Inc.:
- $40 million senior secured first lien revolver due 2010, at
Ba2 (LGD2, 10%)
- $90 million first lien term loan due 2010, at Ba2 (LGD2, 10%)
- $125 million, 8.0% senior subordinated notes due 2012, at B2
(LGD4, 52%)
The Corporate Family Rating continues to primarily reflect the
company's modest free cash flow generation capabilities (negative
after consideration of dividends to sponsor group), moderate
leverage, small size as well as the technology risk from solid
state or new technologies.
The positive ratings outlook reflects Moody's expectation that the
company will continue to experience good demand for its products
that will enable the company to utilize cash flows thus generated
for debt retirement purposes. It is also Moody's expectation that
capital expenditures will start to abate and that sales and
resultant margins will rebound once the relocation of the
company's Eimac division to Palo Alto and its integration into the
existing facility is complete.
The ratings or outlook could move up if the company's operating
results continue to improve, resulting in positive free cash flow
to debt in the range of 5% to 10% or if total debt to EBITDA falls
below 3 times on a sustained basis. Downward pressure on the
ratings or outlook could result if the company cedes share to a
competitor in one of its key markets, a material change in
government spending patterns emerges or a new technology results
in a decline in demand for the company's products. The ratings
could also come under pressure if the company re-leverages its
balance sheet as a result of a recapitalization, major dividend
distribution or acquisition, permits its debt to EBITDA ratio to
exceed 5 times or its EBIT to interest coverage to fall below 2
times on a sustained basis.
CPI International, Inc., the parent company of Communications &
Power Industries, Inc., provides radio frequency, microwave, power
and control solutions for defense, medical, communications,
scientific and other applications.
DATALOGIC INT'L: Sept. 30 Balance Sheet Upside-Down by $2 Million
-----------------------------------------------------------------
Datalogic International Inc. reported a $1.6 million net loss on
$3.4 million of net revenues for the quarter ended Sept. 30, 2006,
compared with a $29,063 net loss on $4.9 million of net revenues
for the same period in 2005.
The decrease in revenues was due to the loss of the Rhode Island
contract during the third quarter of 2006.
The increase in net loss in the current quarter is mainly due to
the decrease in revenues, the increase in operating expenses, and
the loss from discontinued operations of $690,117, partially
offset by the decrease in interest expense and the $236,000
increase in change in fair value of derivative and warrant
liabilities. There was no loss from discontinued operations for
the quarter ended Sept. 30, 2005.
The increase in operating expenses is due to an impairment of
intangibles, the officer buyout, an increase in compensation costs
associated with the expensing of stock options, an increase in
employee benefits, workers compensation, unemployment insurance,
and professional fees.
At Sept. 30, 2006, the company's balance sheet showed $1.6 million
in total assets and $3.6 million in total liabilities, resulting
in a $2 million stockholders' deficit.
The company's balance sheet at Sept. 30, 2006, also showed
strained liquidity with $1.3 million in total current assets
available to pay $2.4 million in total current liabilities.
Full-text copies of the company's consolidated financial
statements for the quarter ended Sept. 30, 2006, are available for
free at http://researcharchives.com/t/s?17b0
Going Concern Doubt
As reported in the Troubled Company Reporter on May 17, 2006,
Corbin & Company, LLP, in Irvine, California, raised substantial
doubt about DataLogic'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 losses and need to establish profitable
operations.
About DataLogic
DataLogic International Inc. (OTC BB: DLGI.OB) --
http://www.dlgi.com/-- is a technology and professional services
company providing a wide range of consulting services and
communication solutions like GPS based mobile asset tracking,
secured mobile communications and VoIP. The company also provides
information technology outsourcing and private label communication
solutions. DataLogic's customers include U.S. and international
governmental agencies as well as a variety of international
commercial organizations.
DURA AUTO: Intercompany Claims Considered Admin. Priority Expense
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware granted, on
a final basis, DURA Automotive Systems, Inc. and its debtor
affiliates, request to accord administrative priority expense
status all Intercompany Claims against a Debtor by another Debtor
or a non-debtor affiliate arising after the Debtors' bankruptcy
filing.
The request was to ensure each individual Debtor will not fund the
operations of another entity.
Daniel J. DeFranceschi, Esq., at Richards, Layton & Finger, P.A.,
in Wilmington, Delaware, relates that the Debtors maintain
business relationships with each other and non-debtor affiliates.
Thus, according to him, there are numerous intercompany claims
that reflect intercompany receivables and payments made in the
ordinary course of the Debtors' businesses, including, but not
limited to:
(a) Accrued interest -- The Debtors and non-debtor affiliates
owe interest between and among each other on outstanding
Intercompany Claims. Accrued interest is charged monthly
based on the net Intercompany Claims outstanding at the
end of that month;
(b) Administrative fees -- Certain Debtors are charged a
percentage of their sales in exchange for marketing
support from the Debtors;
(c) Centrally-billed expenses -- In the ordinary course of
business, the Debtors incur centrally billed expenses,
like insurance, premiums, payroll, 401k payments,
benefits, payroll taxes, workman's compensation
obligations, and technology equipment;
(d) Intercompany loans -- In the ordinary course of business,
the Debtors and non-debtor affiliates make loans between
and among each other to fund operations and make
acquisitions;
(e) Royalties -- Royalties are charged either with reference
to costs incurred or as a percentage of sales to certain
Debtors and non-debtors for the use of technology and
other intellectual property of the Debtors; and
(f) Trade receivables and trade payables -- In the ordinary
course of business, and as a result of the Debtors' Cash
Management System, certain Debtors receive checks and wire
transfers from customers and fund payables on behalf of
various other Debtors. The Debtors' intercompany accounts
reflect the net position of both receipts and
disbursements received or made on behalf of other Debtors.
Mr. DeFranceschi asserts that if Intercompany Claims are accorded
administrative priority expense status, each entity utilizing
funds flowing through the Cash Management System will continue to
bear ultimate repayment responsibility for those ordinary course
transactions.
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: Wants E&Y to Provide Tax Advisory Services
-----------------------------------------------------------
DURA Automotive Systems, Inc. and its debtor affiliates ask
authority from the U.S. Bankruptcy Court for the District of
Delaware to employ Ernst & Young as tax advisory and risk advisory
services providers, nunc pro tunc to Oct. 30, 2006.
Keith Marchiando, vice president and chief financial officer,
relates that Ernst & Young LLP is well experienced in providing
tax and risk advisory services in restructurings and
reorganization, and serves clients in manufacturing, automotive,
and other industries. The firm is also well respected for
services rendered both outside of the bankruptcy context and in
large, complex Chapter 11 cases, Mr. Marchiando adds.
The Debtors engaged, on May 6, 2005, Ernst & Young to provide
internal audit services, services with respect to compliance with
Section 404 of the Sarbanes-Oxley Act of 2002, and loaned staff
services.
The services of Ernst & Young are necessary to enable the Debtors
to maximize the value of their estates and to reorganize
successfully, Mr. Marchiando relates.
The firm is expected to provide tax advisory services to the
Debtors:
(1) FIN 48 implementation services, which include assisting
the Debtors in assessing their current controls and
processes employed in the financial reporting of uncertain
tax positions, and in making appropriate revisions to meet
the requirements under Sarbanes-Oxley Section 404 and
other financial reports;
(2) international compliance review services, including a
review of information to be filed with the U.S. Internal
Revenue Service and all related calculations the Debtors
have identified as material, or that may need managerial
review; and
(3) routine on-call tax advisory services.
The risk advisory services the firm will provide are:
(a) internal audit reaming services, including risk
assessment, audit plan and execution;
(b) business risk services ongoing assistance related to
Section 404 of the Sarbanes-Oxley Act of 2002, including
the preparation of the Debtors' documentation, testing and
evaluation of internal controls over financial reporting
for their significant accounts and processes;
(c) tax risk advisory services ongoing assistance related to
Section 404 of the Sarbanes-Oxley Act of 2002, including
assistance to management in the preparation of its
documentation, testing, and evaluation of internal
controls over financial reporting for the Company's state
and federal tax income tax provision;
(d) loan staff discrete projects in conjunction with share
service center projects including designing a centralized
check disbursement process and the creation of a cash
disbursements journal on a "loaned staff" basis; and
(e) technology and security risk services and information
technology services, including assisting Dura Internal
Audit with testing IT general and application controls in
both the North American and European regions.
Ernst & Young will coordinate any services performed at the
Debtors' request with the Debtors' other professionals to avoid
duplication of effort.
The Debtors will pay Ernst & Young based on its standard hourly
rates:
Loaned Staff
Level BRS TSRS/IT Tax Services
----- --- ------- --- --------
Partner $340 $359 $595 N/A
Senior Manager 242 328 464 N/A
Manager 196 291 323 $196
Senior 132 223 226 132
Staff 113 162 226 113
Mr. Marchiando relates that the Debtors requested a single
"global" retention, whereby the vast international resources of
Ernst & Young could be brought to meet the Debtors' needs,
including non-Debtor foreign affiliates, while maintaining clarity
that all duties are owed to the Debtors.
The Engagement Letter provides that in rendering services to the
Debtors, the firm may subcontract a portion of the services to
certain other Ernst & Young affiliates, including other member
firms of Ernst & Young Global Limited or its affiliates.
Ernst & Young intends to pay EYGL member firms directly for their
services and apply for reimbursement by the Debtors of any
payments made any Ernst & Young to the EYGL Member Firms.
Randall J. Miller, the coordinating principal for Ernst & Young,
assures the Court that the firm is a disinterested person, as
defined in Section 101(14) of the Bankruptcy Code.
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. 7; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
DURA AUTOMOTIVE: Wants to Employ Deloitte as Tax Consultants
------------------------------------------------------------
DURA Automotive Systems, Inc. and its debtor affiliates ask the
U.S. Bankruptcy Court for the District of Delaware for authority
to employ Deloitte Tax LLP as their tax service providers and tax
consultants, nunc pro tunc to Oct. 30, 2006.
Keith Marchiando, vice president and chief financial officer,
relates that the Debtors engaged Deloitte Tax as their tax
consultant and tax compliance service providers before the
Debtors' filing for bankruptcy; thus, the firm has considerable
knowledge concerning the Debtors and their business affairs.
Deloitte Tax also has extensive experience in delivering tax-
consulting services in Chapter 11 cases, he adds.
Deloitte Tax will:
(a) assist with Federal Tax Effects of Bankruptcy Filing/ Tax
Advisory Services related to debt discharge issues,
including to:
-- compute the Debtors' tax basis to provide management
with information regarding income from the discharge of
indebtedness and the tax effect of post-bankruptcy
distributions to new equity holders;
-- advise the Debtors in evaluating and modeling
alternative tax methodologies to assist management in
understanding post-bankruptcy tax attributes;
-- advise the Debtors as to the proper tax treatment of
postpetition interest; and
-- advise the Debtors on the state tax aspects of the
post-bankruptcy environment with a focus on the
Debtors' efforts to optimize the post-bankruptcy tax
structure for tax purposes.
(b) provide general corporate tax advisory assistance,
including:
* tax return review and preparation;
* Internal Revenue Service or state audit responses;
* United States, state, and foreign income tax planning;
and
* transfer pricing documentation and review.
Deloitte Tax will bill:
Professionals Hourly Rates
------------- ------------
Partner $595
Senior Manager $485
Manager $435
Senior Associate $375
Deloitte Tax will also seek reimbursement for reasonable and
necessary expenses incurred in the Debtors' Chapter 11 cases.
Scott J. Vickman, a member of the Deloitte Tax, assures the Court
that his firm does not hold any adverse interest to the Debtors'
estates, and is a disinterested person as the term is defined in
Section 101(14) of the Bankruptcy Code.
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. 7; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
ENTERGY NEW ORLEANS: Market Street Sale Draws Mixed Emotions
------------------------------------------------------------
Entergy New Orleans Inc. sought the U.S. Bankruptcy Court for the
Eastern District of Louisiana's consent to sell certain property
and improvements commonly referred to as the Market Street
Property, free and clear of all liens, encumbrances, and adverse
claims to Market Street Properties, LLC, as published in the
Troubled Company Reporter on Dec 8, 2006.
Objections
(1) BNY
On behalf of The Bank of New York, as indenture trustee, Douglas
S. Draper, Esq., at Heller, Draper, Hayden, Patrick and Horn LLC,
in New Orleans, Louisiana, contends that the $10,000,000 offered
by Market Street Properties, LLC, may not be the best possible
price for the Market Street Property.
Mr. Draper also argues that ENOI's request fails to transfer any
liens attach to the Market Street Property to the sale proceeds,
or, alternatively, the request fails to require payment of the
sale proceeds to the creditors possessing valid and perfected
security interests in the Market Street Property assets.
Accordingly, BNY asks the Court to deny ENOI's Sale Motion.
(2) FGIC
Financial Guaranty Insurance Company contends that ENOI's Sale
Motion fails to meet the prerequisites under Section 363(f) of
the Bankruptcy Code for a sale of property "free and clear" of
interests.
Rudy J. Cerone, Esq., at McGlinchey Stafford, PLLC, in New
Orleans, Louisiana, explains that the Market Street Property
cannot be sold "free and clear" of liens and encumbrances unless
one of the requirements of Section 363(f) are satisfied:
(i) applicable law permits the sale of the property free and
clear of all liens,
(ii) the lienholders consent to the sale,
(iii) the price at which the property is to be sold is greater
than the aggregate value of all liens on the property,
(iv) the lien is in bona fide dispute, or
(v) the lienholders could be compelled, in a legal or
equitable proceeding, to accept money satisfaction of the
lien.
Mr. Cerone notes that ENOI does not argue in its Sale Motion that
any of the requirements of Section 363(f) have been satisfied,
which makes the sale of the Market Street Property improper and
inconsistent with applicable law.
Additionally, ENOI's Sale Motion does not specify what ENOI
intends to do with the sales proceeds; it only generally states
that the sale proceeds will be used to "reduce ENOI's actual and
contingent liabilities."
Mr. Cerone clarifies that FGIC would consent to ENOI's Sale
Motion if the Court expressly directs that (i) the proceeds of
the sale be used to pay down ENOI's outstanding obligations under
the DIP Facility or (ii) the liens of Entergy Corp. and the
Bondholders on the property be attach to the sale proceeds, with
the proceeds held in escrow pending further Court order.
(3) Unsecured Creditors' Committee
The Official Committee of Unsecured Creditors does not object to
the proposed terms and conditions for the sale of ENOI's Market
Street Property, as long as there is a certification by ENOI that
it nor its parent, Entergy Corporation, or ENOI's affiliates,
have any relationship with Market Street Properties, LLC, the
proposed buyer for the Property.
Philip K. Jones, at Liskow & Lewis, APLC, in New Orleans,
Louisiana, explains that the Market Street Property is collateral
of Entergy Corp. under the debtor-in-possession financing
facility. He relates that upon ENOI's receipt of the sale
proceeds, the funds should immediately be paid to Entergy Corp.
Moreover, ENOI should not be allowed to receive and retain the
sale proceeds and not reduce the balance owing to Entergy Corp.
under the DIP Facility. Mr. Jones notes that interest is
accruing, and being paid on the balance under the DIP Facility,
and the accrual of any interest increases the exit financing
needed by ENOI to consummate any plan of reorganization.
Therefore, the Committee objects to ENOI's Sale Motion only to
the extent that:
(1) ENOI, Entergy Corp. and ENOI's affiliates do not certify
that they are related in any manner to Market Street
Properties; and
(2) the proceeds from the sale of the Market Street Property
are not paid to Entergy Corp. to reduce the amount due and
owing under the DIP Facility.
(4) New Orleans City Council
Pursuant to the Constitution of the State of Louisiana and the
Home Rule of New Orleans, the Council to the City of New Orleans
is the governmental body with the sole power of supervision,
regulation and control over public utilities providing service
within New Orleans.
Representing the City Council, Basille Uddo, Esq., at Sullivan &
Worcester LLP, in Metairie, Louisiana, says that the City Council
might be inclined to believe that the sale of the Market Street
Property may be in the best interest of ENOI's bankruptcy estate.
The City Council, however, insists that in completing the sale
transaction, ENOI must comply with the requirements of the City
Council, including complying with Council Resolution R-06-222,
and the Council will preserve its regulatory powers regarding the
sale transaction.
ENOI Responds
According to Tara G. Richard, Esq., at Jones, Walker, Waechter,
Poitevent, Carrere & Denegre, L.L.P., in New Orleans, Louisiana,
the Market Street Property is subject to a first priority lien of
Entergy Corp. arising in connection with the debtor-in-possession
loan provided by Entergy to ENOI.
Ms. Richard clarifies that the sale proceeds for the Market
Street Property will be used to pay down ENOI's outstanding
obligations under the DIP facility.
Ms. Richard disputes BNY's assertion that the $10,000,000 price
for the Property may not be the best possible price for the
assets; it is unfounded because the most recent appraisal of the
property, dated April 19, 2006, placed the fair market value of
the property at $8,000,000.
Ms. Richard notes that Market Street Properties will pay
$10,000,000 in cash to ENOI at the closing of the sale, and the
purchaser will also pay the entire cost of relocating active
electrical transmission and distribution lines that are located
on the Market Street Property.
Additionally, Market Street Properties will assume all potential
environmental liabilities on the site and will defend, indemnify
and hold ENOI harmless with respect to the liabilities.
With regards to the City Council's statement about ENOI's
compliance with Resolution R-06-222, Ms. Richard clarifies that
the sale documents comply with the Resolution and nothing in the
Resolution prevents the sale of the Market Street Property. ENOI
continues to comply with the Resolution, including booking
the sale of the Market Street Property in accordance with the
U.S. Federal Energy Regulatory Commission Uniform System of
Accounts, as required under the Resolution. ENOI will also make
a filing with the Council within 45 days of the closing of the
sale of the Market Street Property.
Accordingly, ENOI asks the Court to overrule the objections to
the sale of the Market Street Property and approve the sale.
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. 32; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
ENTERGY NEW ORLEANS: Roderick West Appointed as New Pres. & CEO
---------------------------------------------------------------
Entergy New Orleans reported that Daniel F. Packer, its president
and chief executive officer since 1996, is retiring effective
Jan. 1, 2007. Mr. Packer will continue to serve as Entergy New
Orleans' chairman until an undetermined date after the company
exits bankruptcy.
Roderick K. West, currently ENO's director of Metro Distribution
Operations, will assume Packer's position as president and CEO.
"Dan has been an extraordinary leader for the city and for
Entergy New Orleans over the last 10 years and particularly during
the company's most challenging chapter following Hurricane
Katrina," said J. Wayne Leonard, Entergy Corporation's chairman
and chief executive officer.
"He has worked steadfastly in the best interest of customers
through a hands-on effort, contributing to the rebirth of the
city and the restoration and rebuilding of electric and gas
service, laying the groundwork for a financially viable utility
critical to meeting the city's needs and by securing federal
funding through state officials to protect customers from large
rate increases," said Mr. Leonard.
Mr. Leonard said, "Challenges remain but there is no one
more capable than New Orleans' own Rod West to guide Entergy New
Orleans into the future. Rod is a proven leader who is as
prepared for this position as anyone I have ever seen. I expect
we will see great things from Rod, and he always seems to exceed
all expectations."
In addition to his ENO responsibilities, Mr. Packer is chairman
of the New Orleans Aviation Board that oversees Louis Armstrong
International Airport and a member of the Board of Trustees for
Loyola University New Orleans. He serves on the board of
Louisiana Community & Technical College System, Keystone Energy
Board, New Orleans Jazz Orchestra and the Fore!Kids Foundation.
He also is a former national chairman of the American Association
of Blacks in Energy.
In 2005, Mr. Packer was honored as one of the "Most Powerful
African American Executives in Corporate America" by Black
Enterprise, a leading business and investment publication for the
African American community. He was the first African American to
hold the position of chairman of the New Orleans Regional Chamber
of Commerce in 2001.
Mr. Packer's career with Entergy began in 1982 as Waterford
3 Nuclear Plant training manager. He later served as Waterford's
plant manager, becoming the first African American in the United
States to manage a nuclear plant. He was named Entergy New
Orleans' president in 1996 and ENO's CEO in 1998.
Prior to joining Entergy, Mr. Packer was a senior engineer
with General Physics Corp. and worked as a training coordinator
with Connecticut Yankee Atomic Power Company. He served in the
U.S. Nuclear Navy Program from 1969 to 1975. Packer, 59, is a
native of Mobile, Ala. He holds a bachelor of arts degree in
business studies from Charter Oak College and a master of
business administration degree from Tulane University.
Mr. West, 38, Packer's successor as president and CEO, has
served as director of Entergy New Orleans' Metro Distribution
Operations since December 2003, and previously served as ENO
director of Regulatory Affairs. Mr. West's primary
responsibility during the last year was restoring New Orleans'
electric distribution system after the devastation brought by
Hurricane Katrina.
Prior to joining Entergy Corp. in April 1999 as senior
regulatory counsel, West was senior attorney in the New Orleans
office of Vial, Hamilton, Koch and Knox, L.L.P, having previously
spent five years with the New Orleans-based firm of Jones,
Walker, Waechter, Poitevent, Carrere & Denegre, L.L.P.
Mr. West has extensive roots in New Orleans and is a
dedicated civic leader for the community. He currently serves as
chairman of the Louisiana State University System's Board of
Supervisors, vice president of the Ernest N. Morial Convention
Center Board of Commissioners, commissioner of the New Orleans
Public Belt Railroad and is a past chairman of New Orleans
Regional Leadership Institute.
Mr. West is also a board member of the Allstate Sugar Bowl
and Greater New Orleans Inc., and a former board member of the
Louisiana Recovery Authority.
Mr. West holds a bachelor of arts degree from the University
of Notre Dame, a juris doctorate degree from Tulane University
and a master of business administration degree from the Tulane
University Freeman School of Business. A prep standout at
Brother Martin High School in New Orleans, West lettered three
years at outside linebacker and tight end for Lou Holtz and the
Fighting Irish of Notre Dame, including playing on the 1988
National Championship team.
"I'm committed to building upon the excellent groundwork
laid by Dan Packer for successfully guiding the company out of
bankruptcy, as well as fortifying the electric and gas
distribution systems serving our customers in the aftermath of
Hurricane Katrina," says Mr. West.
"I accept the challenges of continuing to pursue ways to
provide customers with safe, reliable and affordable energy
through innovative fuel purchases, carrying out the conservation
component of our rate agreement and by partnering with local and
state leadership to secure additional federal assistance for the
recovery efforts. And, as always, Entergy New Orleans will be an
outspoken proponent of the renaissance of New Orleans by
supporting our local institutions as we rebuild our community,"
adds Mr. West.
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. 32; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
FEDERAL-MOGUL: DeVlieg's Claim Not Allowed as Admin. Expense
------------------------------------------------------------
The Honorable Judith K. Fitzgerald of the U.S. Bankruptcy Court
for the District of Delaware denies in all respects DeVlieg-
Bullard II, Inc.'s request to allow its claim as an administrative
expense.
As reported in the Troubled Company Reporter on Aug. 3, 2004
DeVlieg-Bullard II, Inc., asked the Court to:
(a) allow its administrative expense priority claim for
$260,000; and
(b) compel the Debtors to pay the claim.
The claim relates to the Debtors' amendment, in Oct. 30, 2003, to
its Purchase Order for four custom industrial machines from
DeVlieg-Bullard, reducing to two the number of machines.
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. 120; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000).
FEDERAL-MOGUL: Can Sell Allentown Property to Seagis for $6.6 Mil.
------------------------------------------------------------------
Federal-Mogul Corporation and its debtor affiliates, obtained
authority from the U.S. Bankruptcy Court for the District of
Delaware to sell a real property in Allentown, Pennsylvania, free
and clear of certain liens and encumbrances, to Seagis Property
Group, LP, for $6,630,000.
Since 1998, Federal Mogul Products, Inc., has used the Allentown
facility as an aftermarket distribution center to distribute
various products manufactured by the Debtors.
In June 2006, the Debtors completed an internal performance and
logistics review of various distribution centers in the
northeastern part of the United States. The Debtors have
determined to consolidate those distribution centers that are no
longer in reasonable proximity to the customers they serve to
their distribution facilities in Jacksonville, Florida;
Indianapolis, Indiana; and Berkeley, Missouri.
The Allentown facility is among those distribution centers that
will be closed. Indeed, the Debtors have commenced wind-down
operations at the Facility.
The Allentown property is being sold in "as is, where is"
condition. Pursuant to a sale agreement, Seagis paid a $175,000
initial deposit to the Debtors. An additional $175,000 deposit is
due after the Buyer has completed its due diligence efforts, which
must be completed by November 26, 2006. The balance of the
purchase price will be paid at closing.
All of the Debtors' fixtures located at the Allentown facility
will be transferred as part of the sale.
The Debtors marketed the Allentown property beginning August 2006.
Aside from Seagis' offer, the Debtors received two other bids --
for $5,500,000 and for $6,700,000, which was subsequently raised
to $7,200,000. The highest bid, however, was subject to a longer
diligence period and additional contingencies that made the bid
much less certain to close.
CB Richard Ellis, a real estate broker and appraiser, has
estimated the value of the property between $6,200,000 and
$6,500,000. Based on the strong market for distribution
facilities, the Debtors did not list the Allentown property
exclusively with a real estate broker. As a result, the Debtors
relate, they effectively preserved about $267,800 of sale proceeds
that otherwise would have been allocated to a broker based on a 6%
commission rate.
Nonetheless, the Debtors will pay a $130,000 commission to Gelcor
Realty for securing a buyer for the Allentown property. The
commission is 2% of the purchase price.
The Debtors believe that the sale to Seagis represents the highest
and best offer for the Allentown property. The Debtors do not
anticipate that any other entity will be seriously interested in
purchasing the Allentown property. In the event a party submits a
competing offer before the sale hearing, the Debtors assure the
Court that they will exercise their business judgment in
considering the merits of that competing offer.
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. 121; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000).
FELLOWS ENERGY: Incurs $1.06 Mil. Net Loss in Qtr. Ended Sept. 30
-----------------------------------------------------------------
Fellows Energy Ltd. reported a $1,065,185 net loss on $110,643 of
revenues for the third quarter ended Sept. 30, 2006, compared with
a $1,503,362 net loss on zero revenues for the same period in
2005.
At Sept. 30, 2006, the company's balance sheet showed $13,534,369
in total assets, $6,410,344 in total liabilities and a $7,124,025
stockholders' equity. The company's accumulated deficit stood at
10,578,710 as of Sept. 30, 2006.
The company, at Sept. 30, 2006, had $661,000 of cash and cash
equivalents.
A Full-text copy of the company's quarterly report is available
for free at http://researcharchives.com/t/s?17d3
Going Concern
Mendoza Berger & Company, Irvine, Calif., expressed substantial
doubt about Fellows Energy Ltd.'s ability to continue as a going
concern after auditing the company's financial statements for the
year ended Dec. 31, 2005. The auditing firm pointed to the
company's significant operating losses since inception.
About Fellows Energy
Incorporated in Nevada on April 9, 2001, Fellows Energy Ltd. was
originally formed to offer business consulting services in the
retail automobile fueling industry. In November, 2003 the company
ceased all activity in the automotive fueling industry and entered
the oil and gas business, focusing on exploration for oil and gas
in the Rocky Mountain Region. On January 5, 2004, the company
acquired certain interests in certain oil and gas leases and other
interests owned by Diamond Oil & Gas Corporation, a Nevada
corporation. Diamond is wholly owned by George S. Young, Fellows
Energy Ltd.'s CEO.
FOAMEX INTERNATIONAL: Class 9 and 10 Ballots Due on January 18
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware finds the
Supplemental Solicitation Packages sufficiently informative and
appropriate for Classes 9 and 10 under Foamex International Inc.
and its debtor-affiliates' Second Amended Plan of Reorganization
to vote to accept or reject the Plan.
Accordingly, Judge Kevin Gross directs the Debtors to mail or
cause to mail to holders of interests in Classes 9 and 10 under
the Plan. The Debtors may fill in any missing dates and other
information, correct any typographical errors, reformat and make
other non-material, non-substantive changes to the Supplemental
Solicitation Package as they deem appropriate.
All Class 9 and 10 Ballots, including Master Ballots, must be
properly executed, completed and delivered to Bankruptcy Services
LLC no later than January 18, 2007, 4:00 p.m., prevailing Eastern
Time.
The beneficial owners of Existing Common Stock that receive a
Beneficial Owner ballot from a bank or brokerage firm must return
the Ballot to that bank or brokerage firm no later than Jan. 11,
2007.
The Court reschedules the Confirmation Hearing to Feb. 1, 2007, at
11:00 a.m., prevailing Eastern Time.
The Rescheduled Confirmation Hearing Date may be continued from
time to time by the Court without further notice except for
adjournments announced in open court.
To the extent a holder of an interest Classes 9 or 10 wishes to
object to the confirmation of the Plan, that objection must be
made in writing and must be filed with the Court on or before
Jan. 18, 2007.
Headquartered in Linwood, Pa., Foamex International Inc. --
http://www.foamex.com/-- is the world's leading producer of
comfort cushioning for bedding, furniture, carpet cushion and
automotive markets. The Company also manufactures high-
performance polymers for diverse applications in the industrial,
aerospace, defense, electronics and computer industries. The
Company and eight affiliates filed for chapter 11 protection on
Sept. 19, 2005 (Bankr. Del. Case Nos. 05-12685 through 05-12693).
Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison LLP,
represent the Debtors in their restructuring efforts. Houlihan,
Lokey, Howard and Zukin and O'Melveny & Myers LLP are advising the
ad hoc committee of Senior Secured Noteholders. Kenneth A. Rosen,
Esq., and Sharon L. Levine, Esq., at Lowenstein Sandler PC and
Donald J. Detweiler, Esq., at Saul Ewings, LP, represent the
Official Committee of Unsecured Creditors. As of July 3,
2005, the Debtors reported $620,826,000 in total assets and
$744,757,000 in total debts. (Foamex International Bankruptcy
News, Issue No. 36; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
FOAMEX INTERNATIONAL: Court Okays Disclosure Statement Supplement
-----------------------------------------------------------------
The Hon. Kevin Gross of the U.S. Bankruptcy Court for the District
of Delaware approves the Supplement to the Foamex International
Inc. and its debtor-affiliates' Disclosure Statement.
The Court finds the supplemental disclosure regarding the Trading
Restrictions as containing adequate information within the meaning
of Section 1125 of the Bankruptcy Code.
As reported in the Troubled Company Reporter on Dec. 15, 2006, the
Debtors have determined that it would be advisable to restrict
trading of Foamex International's common stock to preserve the
value and protect against a change against a change of control
after the Effective Date. The Trading Restrictions would be
included in the Reorganized Debtors' amended and restated
certificate of incorporation. The Trading Restrictions will only
be necessary, and thus will only be implemented, under certain
limited circumstances related to the Rights Offering.
Headquartered in Linwood, Pa., Foamex International Inc. --
http://www.foamex.com/-- is the world's leading producer of
comfort cushioning for bedding, furniture, carpet cushion and
automotive markets. The Company also manufactures high-
performance polymers for diverse applications in the industrial,
aerospace, defense, electronics and computer industries. The
Company and eight affiliates filed for chapter 11 protection on
Sept. 19, 2005 (Bankr. Del. Case Nos. 05-12685 through 05-12693).
Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison LLP,
represent the Debtors in their restructuring efforts. Houlihan,
Lokey, Howard and Zukin and O'Melveny & Myers LLP are advising the
ad hoc committee of Senior Secured Noteholders. Kenneth A. Rosen,
Esq., and Sharon L. Levine, Esq., at Lowenstein Sandler PC and
Donald J. Detweiler, Esq., at Saul Ewings, LP, represent the
Official Committee of Unsecured Creditors. As of July 3,
2005, the Debtors reported $620,826,000 in total assets and
$744,757,000 in total debts. (Foamex International Bankruptcy
News, Issue No. 36; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
FORCHHEIMER & CO: SIPC Conducting Inventory of Assets
-----------------------------------------------------
The Securities Investor Protection Corporation is conducting
an inventory of the assets of Paul L. Forchheimer & Co., Inc.,
61 Broadway, New York City, and also is seeking to identify a full
list of the customers of the now-shuttered brokerage firm.
SIPC was appointed earlier this month by a federal court to act as
trustee in the Forchheimer & Co. liquidation proceeding in the
wake of the arrest of the Aharon Weichselbaum, who was an employee
at the brokerage firm. SIPC was created by Congress to maintain a
special reserve fund to help investors at bankrupt brokerage
firms.
Mr. Weichselbaum was apprehended by authorities on suspicion of
diverting customer and Forchheimer & Co. assets. He is believed
to have generated typewritten investor account statements, the
accuracy and completeness of which will be analyzed by SIPC. SIPC
investigators estimate that between $300,000 to $3 million in
customer and Forchheimer & Co. assets may be missing and that the
number of affected investors is likely to end up being fewer than
200.
"SIPC is carefully combing through the files and property of the
firm," SIPC President Stephen Harbeck said. "We want to ensure
that we find all existing assets and compile a complete list of
clients to be notified before the clock starts ticking on the
claims submission process in this case."
SIPC was named trustee in the Forchheimer & Co. liquidation
proceeding on Dec. 12, 2006, with the law firm of Drinker Biddle &
Reath, LLP appointed as counsel to the trustee. Immediately upon
its appointment as trustee in the matter, SIPC was on site at the
Forchheimer & Co. offices in New York City in order to secure the
premises and begin the property inventory process. SIPC now is in
the midst of gathering the fullest possible list of customers for
the liquidation review process.
Mr. Weichselbaum was arrested as a flight risk after it was
learned that he has dual citizenship in both the United States and
Israel.
About Forchheimer & Co.
Paul L. Forchheimer & Co., Inc., is a securities brokerage and
investment banking firm headquartered in New York City.
FREEDOM PACKAGING: Files for Bankruptcy Protection in New York
--------------------------------------------------------------
Freedom Packaging Co. Inc. has filed for chapter 11 bankruptcy
protection in New York, The Business Review reports.
The Business Review relates that the company, according to its
bankruptcy filing, has reported about $128,731 in assets and
$2.7 million in debts. First Niagara Financial Group, the largest
creditor, asserted a $343,177 claim while Charles Reed of
Bridgeport, Ct., is owed $391,861 and Philip Gross of Pine Brook,
N.J., held a $310,212 claim.
The Company's president Jon Lawrence was not available for
comment.
Based in Amsterdam, New York, Freedom Packaging Co. Inc., makes
containers used to transport powder, chemicals, paints and liquids
of all kinds. The company also produces plastic tank liners that
are used inside existing liquid storage containers.
GB HOLDINGS: Court Approves Panel's Amended Disclosure Statement
----------------------------------------------------------------
The Honorable Judith H. Wizmur of the U.S. Bankruptcy Court for
the District of New Jersey approved GB Holdings Inc.'s amended
disclosure statement explaining the chapter 11 Plan of Liquidation
filed by the Official Committee of Unsecured Creditors, The
Associated Press reports.
Judge Wizmur gave her stamp of approval to the company's
disclosure statement following billionaire investor Carl Icahn's
bid to pay $53 million for the company's remaining stake in
Atlantic City's Sands Hotel & Casino.
As reported in the Troubled Company Reporter on Dec. 4, 2006,
Mr. Icahn's offer could provide the estate with as much as
$53 million in cash to satisfy administrative expenses and general
unsecured claims. The Committee anticipated a 90% recovery for
general unsecured creditors under the agreement with Mr. Icahn.
Mr. Icahn agreed to pay $53 million for the 2,882,938 shares of
Atlantic common stock, an Icahn-controlled affiliate. AP says
that an Icahn affiliate owned 77% of GB Holdings while Robino
Stortini Holdings, a minority shareholder, owned a 16% stake.
Court documents showed that Robino Stortini would market its right
to buy stock in Atlantic Coast to Mr. Icahn for
$3.7 million.
Robino Stortini and a group of bondholders settled their claims
against Mr. Icahn and his affiliates in return for a bigger share
of proceeds from the Sands Hotel sale in the Dec. 20 2006
settlement.
Plan Hearing
The Court will convene a hearing on Jan. 30, 2007, to confirm the
company's proposed plan. All creditors have until Jan. 23, 2006,
to vote for that Plan.
Under the proposed Plan, bondholders owing $46 million will
recover between 88 cents and 92 cents on the dollar. Robino
Stortini and other minority shareholders will receive about
14 cents for each dollar they're owed, AP adds.
About GB Holdings
Headquartered in Atlantic City, New Jersey, GB Holdings, Inc.,
primarily generates revenues from gaming operations in Atlantic
Coast Entertainment Holdings, which owns and operates The Sands
Hotel and Casino in Atlantic City, New Jersey. The Debtor also
provides rooms, entertainment, retail store and food and beverage
operations. These operations generate nominal revenues in
comparison to the casino operations. The Debtor filed for
chapter 11 protection on September 29, 2005 (Bankr. D. N.J. Case
No. 05-42736). Alan I. Moldoff, Esq., at Adelman Lavine Gold and
Levin, represents the Debtor. Charles A. Stanziale, Jr., Esq., at
McElroy, Deutsch, Mulvaney & Carpenter, serves as counsel to the
Official Committee Of Unsecured Creditors. When the Debtor filed
for protection from its creditors, it estimated assets and debts
between $10 million to $50 million.
GLIMCHER REALTY: Prepays Mortgage Debt on University Mall Property
------------------------------------------------------------------
Glimcher Realty Trust retired the mortgage debt on its University
Mall property using proceeds available under its line of credit
facility.
The Loan had an optional prepayment date of January 2013 and an
effective interest rate of 7.09%.
The company had previously intended to sell the University Mall,
along with four other properties.
As a result of the early retirement of the loan, the company will
incur a one-time charge of approximately $9.4 million for
defeasance fees and the write-off of unamortized deferred
financing costs, which will be included in net income and funds
from operations during the fourth quarter of 2006.
"This better positions the property for a potential sale or joint
venture contribution," Michael P. Glimcher, president and chief
executive officer, stated. "Next month, we plan to provide an
update on the status of the sales process for all of our held-for-
sale mall properties."
Glimcher Realty Trust (NYSE: GRT) is a real estate investment
trust, which owns, manages, acquires and develops regional and
super-regional malls. The Company is a component of both the
Russell 2000(R) Index, representing small cap stocks, and the
Russell 3000(R) Index, representing the broader market.
* * *
As reported in the Troubled Company Reporter on July 12, 2006,
Standard & Poor's Ratings Services affirmed its 'BB' corporate
credit and 'B' preferred stock ratings on Glimcher Realty Trust.
The affirmations affect $210 million in outstanding rated
preferred stock. S&P said the outlook is stable.
GLOBAL POWER: Court Okays Blackstone Group as Financial Advisor
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
Global Power Equipment Group, Inc. and its debtor-affiliates to
employ The Blackstone Group L.P. as their financial advisor nunc
pro tunc to Oct. 16, 2006.
Global Power is expected to:
a. assist in the evaluation of the company's businesses and
prospects;
b. assist in the development of the company's long-term
business plan and related financial projections;
c. assist in the development of financial data and
presentations to the company's Board of Directors, various
creditors and other third parties;
d. analyze the company's financial liquidity and evaluate
alternatives to improve the liquidity;
e. analyze various restructuring scenarios and the potential
impact of these scenarios on the recoveries of those
stakeholders impacted by the restructuring;
f. provide strategic advice with regard to restructuring or
refinancing the company's obligations;
g. evaluate the company's debt capacity and alternative capital
structures;
h. participate in negotiations among the company and its
creditors, suppliers, lessors and other interested parties;
i. value securities offered by the company in connection with a
restructuring;
j. advise the company and negotiate with lenders with respect
to potential waivers or amendments of various credit
facilities;
k. assist in arranging debtor-in-possession financing for the
company, as requested by the company;
l. provide expert witness testimony in these chapter 11 cases
concerning any of the subjects encompassed by the other
financial advisory services;
m. assist the company in preparing marketing materials in
conjunction with a possible transaction as requested by the
company;
n. assist the company in identifying potential buyers or
parties in interest to a transaction and assist in the due
diligence process;
o. assist and advise the company concerning the terms,
conditions and impact of any proposed transaction; and
p. provide other advisory services as are customarily provided
in connection with the analysis and negotiation of a
restructuring or a transaction, as requested and mutually
agreed.
Eric M. Sutty, Esq., one of the Debtors' counsel, disclosed that
pursuant to an Engagement Letter between the Debtors and
Blackstone Group, the firm will receive:
a. a monthly advisory fee of $150,000 in cash, with the first
monthly fee payable upon the execution of the Engagement
Letter and additional installments of the monthly fee
payable in advance on each monthly anniversary of the
retention date;
b. an additional restructuring fee of $1,650,000, except as
provided in the Engagement Letter. A restructuring will be
deemed to have been consummated upon the execution,
confirmation and consummation of a Plan of Reorganization
pursuant to an order of the Court;
c. upon the consummation of a transaction, a transaction fee
payable in cash directly out of the gross proceeds of the
transaction.
Blackstone will be reimbursed of all reasonable out-of-pocket
expenses and internal charges incurred.
Mr. Sutty assures the Court that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the
Bankruptcy Code and does not hold or represent any interest
adverse to the Debtors' estates.
Headquartered in Tulsa, Oklahoma, Global Power Equipment Group
Inc. aka GEEG Inc. -- http://www.globalpower.com/-- provides
power generation equipment and maintenance services for its
customers in the domestic and international energy, power and
infrastructure and service industries. The Company designs,
engineers and manufactures a range of heat recovery and auxiliary
equipment primarily used to enhance the efficiency and facilitate
the operation of gas turbine power plants as well as for other
industrial and power-related applications. The Company has
facilities in Plymouth, Minnesota; Tulsa, Oklahoma; Auburn,
Massachusetts; Atlanta, Georgia; Monterrey, Mexico; Shanghai,
China; Nanjing, China; and Heerleen, The Netherlands.
The Company and 10 of its affiliates filed for chapter 11
protection on Sept. 28, 2006 (Bankr. D. Del. Case No 06-11045).
Attorneys at White & Case LLP and The Bayard Firm, P.A., represent
the Debtors. The Official Committee of Unsecured Creditors
appointed in the Debtors' cases has selected Landis Rath & Cobb
LLP as its counsel. As of Sept. 30, 2005, the Debtors reported
total assets of $381,131,000 and total debts of $123,221,000. The
Debtors' exclusive period to filed a chapter 11 plan expires on
Jan. 26, 2007.
GLOBAL POWER: Wants April 18 Set as General Claims Bar Date
-----------------------------------------------------------
Global Power Equipment Group Inc. and its debtor-affiliates ask
the U.S. Bankruptcy Court for the District of Delaware to set
April 18, 2007, as the deadline for all creditors and governmental
units owed money by the Debtors on the account of claims arising
prior to Sept. 28, 2006.
The Debtors also ask the Court to set May 18, 2007, as the
deadline for all creditors, including the Debtors, owed money by
co-Debtors, sureties or guarantors, on accounts of claims arising
prior to Sept. 28, 2006.
The purpose of the bar date is to provide a deadline to identify
any possible unknown claims against the Debtors' estates and to
give parties additional certainty regarding the magnitude of
claims against the Debtors' estates.
Copies of written proofs of claim must be sent or hand delivered
on or before the April 18 Bar Date to:
Global Power Equipment Group, Inc.
c/o Alix Partners LLC
2100 McKinney Avenue, Suite 800
Dallas, Texas 75201
Headquartered in Tulsa, Oklahoma, Global Power Equipment Group
Inc. aka GEEG Inc. -- http://www.globalpower.com/-- provides
power generation equipment and maintenance services for its
customers in the domestic and international energy, power and
infrastructure and service industries. The Company designs,
engineers and manufactures a range of heat recovery and auxiliary
equipment primarily used to enhance the efficiency and facilitate
the operation of gas turbine power plants as well as for other
industrial and power-related applications. The Company has
facilities in Plymouth, Minnesota; Tulsa, Oklahoma; Auburn,
Massachusetts; Atlanta, Georgia; Monterrey, Mexico; Shanghai,
China; Nanjing, China; and Heerleen, The Netherlands.
The Company and 10 of its affiliates filed for chapter 11
protection on Sept. 28, 2006 (Bankr. D. Del. Case No 06-11045).
Attorneys at White & Case LLP and The Bayard Firm, P.A., represent
the Debtors. The Official Committee of Unsecured Creditors
appointed in the Debtors' cases has selected Landis Rath & Cobb
LLP as its counsel. As of Sept. 30, 2005, the Debtors reported
total assets of $381,131,000 and total debts of $123,221,000. The
Debtors' exclusive period to filed a chapter 11 plan expires on
Jan. 26, 2007.
HOLLINGER INC: Lord Black Seeking $20.4 Million in Damages
----------------------------------------------------------
Hollinger Inc. disclosed that Lord Conrad Black served a Notice of
Action and Statement of Claim on the company on Dec. 13, 2006,
pursuant to which Lord Black seeks damages in the amount of
approximately $20.4 million and associated costs in the amount of
$192,000, plus interest, relating to amounts paid by Black to Sun-
Times Media Group, Inc. on July 16, 2004 in satisfaction of the
Delaware Chancery Court judgment dated June 28, 2004 (in respect
of the non-competition payments that were diverted from Sun-Times
to the company).
The company disputes Lord Black's claim for damages and believes
that, in any event, it has a valid basis for offsetting any
successful claim by Lord Black against various amounts it has
claimed from Lord Black.
As reported in the Troubled Company Reporter on Sept. 6, 2006,
the Honorable Colin Campbell of the Ontario Superior Court placed
a $20,000 monthly allowance restriction for Lord Conrad Black and
his wife, Barbara Amiel.
The restriction is part of a Mareva order freezing all of Lord
Black's assets, Elena Cherney writes for The Wall Street Journal.
The Blacks may apply for additional funds after they file a sworn
affidavit listing the value of their assets.
Hollinger Inc. asked the Court to issue the freeze order last
month on fears that it may not be able to recover damages from the
Blacks if it wins in a lawsuit filed against Lord Black, the
National Post reports. Trial is slated to begin in March 2007.
Hollinger Inc. is accusing Lord Black of breach of contract,
conspiracy and unjust enrichment. Hollinger claims it was
stripped of its assets when the media baron transferred his
holdings to U.S.-based Hollinger International Inc. Hollinger
Inc. wants to recover $700 million from Lord Black.
Motion on Insurance Expenses Recovery
The company has brought a motion in the Ontario Superior Court of
Justice for recovery under its directors' and officers' insurance
policy of expenses aggregating approximately $8 million, which
motion is currently scheduled to be heard before the Honorable Mr.
Justice Campbell on Feb. 28, 2007 and March 1, 2007.
In respect of the motion brought by the company for directions of
the Ontario Superior Court of Justice in order to commence an
action against certain of its former directors to recover
excessive compensation, there is currently a mediation scheduled
before the Honorable Mr. Justice Ground on Feb. 22 and 23, 2007 to
determine the fairness and reasonability of the compensation paid
to these directors by the company.
Ravelston Receivership
In respect of the receivership of The Ravelston Corporation
Limited and its subsidiaries, Conrad Black Capital Corporation and
Peter G. White Management Limited recently filed a motion seeking
advice and direction of the Ontario Superior Court of Justice
concerning Ravelston's participation in the U.S. criminal
proceeding against Ravelston, Conrad Black and others. In their
motion, the moving parties allege that Ravelston and the company
are unnecessarily spending money and ask the Court to direct the
Ravelston receiver to maintain Ravelston's assets and to exercise
its control over the company to cause it to do the same. The
moving parties also state that Lord Black and his group will seek
control of the Board of Directors of the Company at a later date
after the end of the U.S. criminal proceeding.
About Hollinger Inc.
Toronto, Ontario-based Hollinger Inc.'s (TSX: HLG.C)(TSX:
HLG.PR.B) -- http://www.hollingerinc.com/-- principal asset is
its 66.8% voting and 17.4% equity interest in Hollinger
International, a newspaper publisher with assets, which include
the Chicago Sun-Times and a large number of community newspapers
in the Chicago area. Hollinger also owns a portfolio of
commercial real estate in Canada.
Litigation Risks
Hollinger, Inc., faces various court cases and investigations:
(1) a consolidated class action complaint filed in Chicago,
Illinois;
(2) a class action lawsuit that was filed in the Saskatchewan
Court of Queen's Bench on September 7, 2004;
(3) a $425,000,000 fraud and damage suit filed in the State
of Illinois by Hollinger International;
(4) a lawsuit seeking enforcement of a November 15, 2003,
restructuring proposal to uphold a Shareholders' Rights
Plan, a declaration that corporate by-laws were invalid and
to prevent the closing of a certain transaction;
(5) a lawsuit filed by Hollinger International seeking
injunctive relief for the return of documents of which it
claims ownership;
(6) a $5,000,000 damage action commenced by a lessor of an
aircraft lease, in which Hollinger was the guarantor;
(7) an action commenced by the United States Securities and
Exchange Commission on November 15, 2004, seeking
injunctive, monetary and other equitable relief; and
(8) investigation by the enforcement division of the OSC
Hollinger Inc. has also been unable to file its annual financial
statements, Management's Discussion & Analysis and Annual
Information Form for the years ended Dec. 31, 2003, 2004 and 2005
on a timely basis as required by Canadian securities legislation.
Hollinger has not filed its interim financial statements for the
fiscal quarters ended March 31, June 30 and Sept. 30 in each of
its 2004 and 2005 fiscal years. Also, Hollinger has not filed its
financial statements for the period ended March 31, 2006.
HOST AMERICA: Sept. 30 Balance Sheet Upside-Down by $3.4 Million
----------------------------------------------------------------
Host America Corp. reported a $1.4 million net loss on
$9.1 million of revenues for the quarter ended Sept. 30, 2006,
compared with a $7.6 million net loss on $9 million of revenues
for the same period in 2005.
The decrease in net loss is mainly due to the $2.4 million
decrease in selling, general and administrative expenses, the
$1.2 million fair value loss on warrant recorded in the prior
period quarter, with no corresponding charge in the current
quarter, the $1 million amortization and write off of deferred
financing costs in 2005 versus $23,378 in the current quarter, and
the $1.8 million amortization and write off of debt discount in
the prior period quarter compared to $62,022 in the current
quarter.
At Sept. 30, 2006, the company's balance sheet showed
$10.4 million in total assets and $13.9 million in total
liabilities, resulting in a $3.4 million total stockholders'
deficit.
The company's balance sheet at Sept. 30, 2006, also showed
strained liquidity with $8.4 million in total current assets
available to pay $10.1 million in total current liabilities.
Full-text copies of the company's consolidated financial
statements for the quarter ended Sept. 30, 2006, are available for
free at http://researcharchives.com/t/s?17c2
Going Concern Doubt
Mahoney Cohen & Company, CPA, in New York, N.Y., expressed
substantial doubt about Host America's ability to continue as a
going concern after auditing the company's financial statements
for the years ended June 30, 2006, and 2005. The auditing firm
pointed to the company's recurring losses from continuing
operations, negative cash flows and stockholders' deficiency at
Jun. 30, 2006. The auditing firm also said that the company's
involvement in significant litigations can have an adverse effect
on the company's operations.
About Host America
Headquartered in Hamden, Conn., Host America Corporation (Other
OTC: CAFE.PK) -- http://www.hostamericacorp.com/-- provides
customized energy management and conservation solutions for
commercial, industrial and real estate customers. The company's
food management business provides outsource food management on a
long-term contract basis for corporations, schools, meals on
wheels, and head start programs. The company employs
approximately 524 employees.
INNOVA ROBOTICS: Sept. 30 Balance Sheet Upside-Down by $5.1 Mil.
----------------------------------------------------------------
Innova Robotics & Automation, Inc., fka Innova Holdings, Inc.,
incurred a $2.9 million net loss on $324,020 of revenues for the
third quarter ended Sept. 30, 2006, compared with a $523,176 net
loss on zero revenues for the same period in 2005.
At Sept. 30, 2006, the company's balance sheet showed $1.6 million
in total assets and $6.8 million in total liabilities, resulting
in a $5.1 million stockholders' deficit.
The company's balance sheet at Sept. 30, 2006, also showed
strained liquidity with $554,862 in total current assets available
to pay $5.8 million in total current liabilities.
A Full-text copy of the company's quarterly report is available
for free at http://researcharchives.com/t/s?17d4
Stockholders Meeting
On Nov. 3, 2006, the company held its Special Meeting of
Stockholders, authorizing a reverse split of the company's issued
and outstanding shares of common stock at a ratio of one-for-ten.
A total of 75,099,826 shares of Common Stock entitled to vote.
The reverse split was effectuated on Nov. 20, 2006. In addition,
the Company changed its corporate name from Innova Holdings, Inc.
to Innova Robotics and Automation, Inc.
Going Concern
Lopez, Blevins, Bork & Associates, LLP, in Houston, Texas,
expressed substantial doubt about Innova Robotics' ability to
continue as a going concern after auditing the company's financial
statements for the year ended Dec. 31, 2005. The auditing firm
pointed to the company's recurring losses.
Innova Robotics will require additional working capital to develop
its business until it either achieves a level of revenues adequate
to generate sufficient cash flows from operations; or obtains
additional financing necessary to support its working capital
requirements.
About Innova Robotics
Based in Fort Myers, Florida, Innova Robotics & Automation, Inc.
fka Innova Holdings, Inc. -- http://www.innovaholdings.com/--
through its subsidiaries, provides hardware and software systems-
based solutions to the military, service, personal, and industrial
robotic markets in the United States. It offers nonproprietary
and open-architecture PC controls, software, and related products
for robots and other automated equipment. The company provides
Universal Robot Controller, an open-architecture control system
that operates the robot; and Universal Automation Controller, a
general-purpose motion control system for automated machines.
INROB TECH: Posts $269,434 Net Loss in Quarter Ended Sept. 30
-------------------------------------------------------------
Inrob Tech Ltd. reported a $269,434 net loss on $182,225 of total
revenues for the quarter ended Sept. 30, 2006, compared with a
$447,888 net loss on $110,247 of total revenues for the same
period in 2005.
The overall increase in revenues resulted primarily from an
increase in product sales of $110,545, offset by a decrease in
service revenues which amounted to $38,567.
The company had a net loss before taxes of $462,858 in the current
quarter compared to a net loss of $447,930 in the same period in
2005, primarily due to the $65,080 increase in cost of goods sold
and the $39,067 increase in general and administrative expenses
which more than offset the increase in revenues. The company
however reported a lower net loss in view of an income tax benefit
of $193,424 in the current quarter compared to $42 in the 2005
quarter.
At Sept. 30, 2006, the company's balance sheet showed $2.5 million
in total assets, $2.2 million in total liabilities, and $283,165
in total stockholders' equity.
The company's balance sheet at Sept. 30, 2006, also showed
strained liquidity with $1.2 million in total current assets
available to pay $2.2 million in total current liabilities.
Full-text copies of the company's consolidated financial
statements for the quarter ended Sept. 30, 2006, are available for
free at http://researcharchives.com/t/s?17c7
Going Concern Doubt
Davis Accounting Group P.C., in Cedar City, Utah, expressed doubt
about Inrob Tech Ltd.'s ability to continue as a going concern
after auditing the company's Dec. 31, 2005 financial statements.
The auditing firm pointed to the company's operating losses and
negative working capital at Dec. 31, 2005.
* * *
Headquartered in Las Vegas, Nevada, InRob Tech Ltd. (OTCBB:
IRBL.OB) -- http://www.inrobtech.com/-- is a high-tech company
with a wholly owned subsidiary in Israel, specializing in the
planning, manufacturing and service support of advanced wireless
and remote control systems, operating all types of robots and
other vehicles. The company is a leader in its field, and supports
the Israeli Defense Forces, Israeli police, and other military and
civilian companies dealing with security. Founded in 1988, the
company works closely with other high-tech companies to provide
the most advanced and comprehensive UGV solutions to the market.
IVI COMMUNICATIONS: Sept. 30 Balance Sheet Upside-Down by $803,069
------------------------------------------------------------------
IVI Communications Inc. earned $364,907 of net income on $461,103
of revenues for the second fiscal quarter ended Sept. 30, 2006,
compared with a $1,531,055 net loss on $664,264 of revenues for
the same period in 2005.
At Sept. 30, 2006, the company's balance sheet showed $4,697,333
in total assets and $5,500,402 in total liabilities, resulting in
a $803,069 stockholders' deficit. The company's accumulated
deficit stood at $25,279,748 as of Sept. 30, 2006.
The company's balance sheet at Sept. 30, 2006, also showed
strained liquidity with $488,835 in total current assets available
to pay $4,504,558 in total current liabilities.
A Full-text copy of the company's quarterly report is available
for free at http://researcharchives.com/t/s?17bf
Going Concern
Bagel, Josephs, Levine & Company, LLC, in Gibbsboro, New Jersey,
raised substantial doubt about IVI Communications Inc.'s ability
to continue as a going concern after auditing the company's
consolidated financial statements for the year ended Mar. 31,
2006. The auditor pointed to the company's operating losses and
capital deficits.
About IVI Communications
IVI Communications, Inc. -- http://www.ivn.net/-- acquires,
consolidates and profitably operates locally branded ISPs to offer
state of the art dialup and fixed wireless broadband Internet
access and other services such as VoIP Internet Telephony to
residential and business customers.
IVI has three wholly owned subsidiaries, Internet Business
Consulting, Inc., Futura, Inc., and AppState.Net. IBC is a VoIP
services provider and a source of turnkey wireless networks that
has the expertise required to engineer, install, and support
wireless applications and solutions. Futura, founded in September
1995, is a regional Internet Service Provider serving dialup, DSL
and VoIP in communities surrounding Little Rock, Arkansas.
AppState.net is an Internet Service Provider founded in July 1999
providing wireless and dialup Internet access to the Appalachian
State University town of Boone, NC.
KLEROS PREFERRED: Moody's Rates to $10 Million Notes at Ba3
-----------------------------------------------------------
Moody's Investors Service assigned these ratings to Notes and
Combination Securities issued by Kleros Preferred Funding IV,
Ltd.:
-- Aaa to $1,200,000,000 Class A-1 First Priority Senior
Secured Delayed Draw Floating Rate Notes Due 2051;
-- Aaa to $200,000,000 Class A-2 Second Priority Senior
Secured Floating Rate Notes Due 2051;
-- Aaa to $400,000,000 Class A-3 Third Priority Senior Secured
Floating Rate Notes Due 2051;
-- Aaa to $91,000,000 Class A-4 Fourth Priority Senior Secured
Floating Rate Notes Due 2051;
-- Aa2 to $55,000,000 Class B Fifth Priority Senior Secured
Floating Rate Notes Due 2051;
-- A2 to $15,000,000 Class C Sixth Priority Mezzanine Secured
Deferrable Floating Rate Notes Due 2051;
-- A3 to $6,000,000 Class D Seventh Priority Mezzanine Secured
Deferrable Floating Rate Notes Due 2051;
-- Baa2 to $14,600,000 Class E Eighth Priority Mezzanine
Secured Deferrable Floating Rate Notes Due 2051;
-- Ba1 to $5,000,000 Class F Ninth Priority Mezzanine Secured
Deferrable Floating Rate Notes Due 2051;
-- Ba3 to $10,000,000 Combination Notes Due 2051; and,
-- Aaa to $250,000 Principal Protected Notes Due 2051.
The Moody's ratings of the notes address the ultimate cash receipt
of all required interest and principal payments, as provided by
the notes' governing documents, and are based on the expected loss
posed to noteholders, relative to the promise of receiving the
present value of such payments.
The Moody's rating of the Combination Securities addresses the
receipt of the Combination Note Rated Balance plus Combination
Note Rated Interest thereon and the Moody's rating of the
Principal Protected Notes addresses only the ultimate receipt of
the stated principal amount thereof.
The ratings reflect the risks due to the diminishment of cash flow
from the underlying portfolio consisting of RMBS Securities, ABS
Securities and Related Synthetic Securities due to defaults, the
transaction's legal structure and the characteristics of the
underlying assets.
Strategos Capital Management, LLC will manage the selection,
acquisition and disposition of collateral on behalf of the issuer.
LASERLIGHT INC: Sept. 30 Balance Sheet Upside-Down by $3.9 Million
------------------------------------------------------------------
LaserLight, Inc., filed its financial statements for the quarter
ended Sept. 30, 2006, with the Securities and Exchange Commission.
The company reported a $367,251 net loss on $231,299 of revenues
for the three months ended Sept. 30, 2006, versus a $104,936 net
income on $1,336,079 of revenues for the three months ended
Sept. 30, 2005.
Management discloses that the decrease in revenues was primarily
attributable to decreased sales of laser systems as a result of
the expiration of our product registration in China. No lasers
systems or AstraMax systems were sold in the third quarter of
2006, and four were sold in the third quarter of 2005.
At Sept. 30, 2006, the company's balance sheet showed $2,909,764
in total assets and $6,834,602 in total liabilities resulting in a
stockholders' deficit of $3,924,838.
Going Concern
Moore Stephens Lovelace, P.A., in Orlando, Florida, expressed
substantial doubt about LaserSight Inc.'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 substantial losses since its inception,
and significant capital deficit at Dec. 31, 2005.
A full-text copy of the regulatory filing is available for free at
http://ResearchArchives.com/t/s?17ce
About LaserSight
Headquartered in Winter Park, Florida, LaserSight Incorporated
(Other OTC:LRST.PK) -- http://www.lase.com/-- manufactures and
supplies narrow beam scanning excimer laser systems, topography-
based diagnostic workstations, and other related products used to
perform procedures that correct common refractive vision disorders
such as nearsightedness, farsightedness and astigmatism. Since
1994, the company has marketed its laser systems commercially in
over 30 countries worldwide.
LACERTA ABS: Moody's Rates $40 Mil. Class E Secured Notes at Ba2
----------------------------------------------------------------
Moody's Investors Service assigned these ratings to Notes issued
by Lacerta ABS CDO 2006-1, Ltd.:
-- Aaa to $200,000,000 Class A-1 Floating Rate Senior Secured
Notes Due 2046;
-- Aa2 to $100,000,000 Class A-2 Floating Rate Senior Secured
Notes Due 2046;
-- A2 to $110,000,000 Class B Floating Rate Deferrable
Interest Secured Notes Due 2046;
-- Baa2 to $80,000,000 Class C Floating Rate Deferrable
Interest Secured Notes Due 2046;
-- Ba1 to $30,000,000 Class D Floating Rate Deferrable
Interest Secured Notes Due 2046; and,
-- Ba2 to $40,000,000 Class E Floating Rate Deferrable
Interest Secured Notes Due 2046.
The Moody's ratings of the notes address the ultimate cash receipt
of all required interest and principal payments, as provided by
the notes' governing documents, and are based on the expected loss
posed to noteholders, relative to the promise of receiving the
present value of such payments.
LEVEL 3: Completes Offering for $650 Mil. of 9.25% Senior Notes
---------------------------------------------------------------
Level 3 Communications, Inc., has completed its offering of
$650 million aggregate principal amount of 9.25% Senior Notes
due 2014. The offering represents an additional offering of
9.25% Notes that were issued on Oct. 30, 2006. The 9.25% Notes
were issued as additional debt securities under the same indenture
as the 9.25% Notes issued on Oct. 30, 2006, and will be treated
under that indenture as a single series of notes with the
outstanding 9.25% Notes. The 9.25% Notes will mature in 2014 and
pay 9.25 percent annual cash interest. The 9.25% Notes were
priced at 101.75% of the principal amount plus accrued interest
from Oct. 30, 2006.
Level 3 intends to use the net proceeds from the offering:
(i) to purchase Level 3 Financing, Inc.'s 10.75% Senior Notes
due 2011 pursuant to the tender offer and consent
solicitation,
(ii) to the extent that less than all of the 10.75% Notes are
purchased in the tender offer, to effect a satisfaction and
discharge under the indenture governing the 10.75% Notes or
otherwise repurchase the 10.75% Notes that remain
outstanding after the tender offer (if any), and
(iii) to pay fees and expenses incurred in connection with the
foregoing.
Gross proceeds from the offering of the 9.25% Notes that exceed
the amount necessary to repurchase or refinance the 10.75% Notes
will constitute purchase money indebtedness under the existing
indentures of Level 3 and will be used solely to fund the cost of
construction, installation, acquisition, lease, development or
improvement of any Telecommunications/IS Assets, including the
cash purchase price of any past, pending or future acquisitions.
The 9.25% Notes are unsecured, unsubordinated obligations of Level
3 Financing, Inc. and rank equally with all of Level 3 Financing,
Inc.'s other existing and future indebtedness that is not
expressly subordinated in right of payment to the 9.25% Notes.
Level 3, Level 3 Financing, Inc. and the initial purchasers of the
9.25% Notes entered into a registration rights agreement regarding
the 9.25% Notes pursuant to which Level 3 and Level 3 Financing,
Inc. agreed to file an exchange offer registration statement with
the Securities and Exchange Commission with respect to the 9.25%
Notes.
The 9.25% Notes are not registered under the Securities Act of
1933 or any state securities laws and, unless so registered, may
not be offered or sold except pursuant to an applicable exemption
from the registration requirements of the Securities Act of 1933
and applicable state securities laws.
Headquartered in Bloomfield, Colorado, Level 3 Communications,
Inc. (Nasdaq: LVLT) -- http://www.Level3.com/-- an international
communications company, provides Internet connectivity for
millions of broadband subscribers. The company provides a
comprehensive suite of services over its broadband fiber optic
network including Internet Protocol services, broadband transport
and infrastructure services, colocation services, voice services
and voice over IP services.
* * *
As reported in the Troubled Company Reporter on Dec. 20, 2006,
Standard & Poor's Ratings Services assigned its 'CCC-' rating to
$650 million of 9.25% senior notes due 2014 issued by Level 3
Financing Inc., a subsidiary of Broomfield, Colorado-based Level 3
Communications Inc.
As reported in the Troubled Company Reporter on Oct. 30, 2006,
Fitch assigns a rating of 'B/RR1' to Level 3 Financing, Inc.'s
issuance of $600 million of 9.25% senior notes due 2014. In
addition, Fitch affirms the 'CCC' Issuer Default Rating and each
issue rating for Level 3 Communications, Inc. and Level 3
Financing, Inc. The Rating Outlook is Positive.
LEVEL 3: Gets Requisite Consents in 10.75% Notes' Tender Offer
--------------------------------------------------------------
Level 3 Communications, Inc. disclosed that, as part of its tender
offer and consent solicitation for Level 3 Financing, Inc.'s
10.75% Senior Notes due 2011, as of 5:00 p.m., New York City time,
on Dec. 27, 2006, Level 3 had accepted tenders and consents for
approximately $496,716,000 in total principal amount of 10.75%
Notes, representing approximately 99.34% of the aggregate
principal amount outstanding of all 10.75% Notes.
In connection with the tender offer and related consent
solicitation, on Dec. 27, 2006, Level 3 Financing, Inc. entered
into a Supplemental Indenture supplementing the Indenture, dated
as of Oct. 1, 2003, among Level 3, as Guarantor, Level 3
Financing, Inc., as Issuer, and The Bank of New York, as Trustee,
relating to the 10.75% Notes. The Supplemental Indenture was
entered into among Level 3, Level 3 Financing, Inc., Level 3
Communications, LLC and The Bank of New York, as Trustee.
Pursuant to the Supplemental Indenture, the 10.75% Note Indenture
is amended to eliminate substantially all of the covenants,
certain repurchase rights and certain events of default and
related provisions contained in the 10.75% Note Indenture.
The tender offer for the 10.75% Notes is scheduled to expire at
5:00 p.m., New York City time, on Jan. 11, 2007. 10.75% Notes
tendered after the Consent Time but prior to the Expiration Date
will not receive a consent payment. 10.75% Notes tendered on or
prior to the Consent Time may no longer be withdrawn. The
settlement date for 10.75% Notes tendered on or prior to the
Consent Time is expected to be Dec. 28, 2006.
Copies of the Offer to Purchase and the related Letter of
Transmittal may be obtained from the Information Agent for the
tender offer Global Bondholder Services Corporation, at
(212) 430-3774 and (866) 389-1500 (toll-free). Merrill Lynch &
Co. is the Dealer Manager for the tender offer. Questions
regarding the tender offer may be directed to Merrill Lynch & Co.
at (888) 654-8637 (toll-free) and (212) 449-4914.
Headquartered in Bloomfield, Colorado, Level 3 Communications,
Inc. (Nasdaq: LVLT) -- http://www.Level3.com/-- an international
communications company, provides Internet connectivity for
millions of broadband subscribers. The company provides a
comprehensive suite of services over its broadband fiber optic
network including Internet Protocol services, broadband transport
and infrastructure services, colocation services, voice services
and voice over IP services.
* * *
As reported in the Troubled Company Reporter on Dec. 20, 2006,
Standard & Poor's Ratings Services assigned its 'CCC-' rating to
$650 million of 9.25% senior notes due 2014 issued by Level 3
Financing Inc., a subsidiary of Broomfield, Colorado-based Level 3
Communications Inc.
As reported in the Troubled Company Reporter on Oct. 30, 2006,
Fitch assigns a rating of 'B/RR1' to Level 3 Financing, Inc.'s
issuance of $600 million of 9.25% senior notes due 2014. In
addition, Fitch affirms the 'CCC' Issuer Default Rating and each
issue rating for Level 3 Communications, Inc. and Level 3
Financing, Inc. The Rating Outlook is Positive.
LIBERTY MEDIA: S&P Affirms BB+ Ratings and Removes Negative Watch
-----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB+' ratings on
six classes from four synthetic transactions related to Liberty
Media LLC and removed them from CreditWatch, where they were
placed with negative implications on Nov. 17, 2005.
The affirmations and CreditWatch negative removals follow the
Dec. 22, 2006, affirmations and CreditWatch negative removals of
the long-term ratings on Liberty Media LLC.
The affirmed ratings are linked to Liberty Media LLC are:
-- The PreferredPLUS Trust Series LMG-1 rating is weak-linked to
$133.575 million 8.25% senior debentures issued by Liberty
Media;
-- The PreferredPLUS Trust Series LMG-2 rating is weak-linked to
$31 million 8.5% senior unsecured notes issued by Liberty
Media;
-- The PPLUS Trust Series LMG-3 rating is weak-linked to $30.55
million 8.25% senior debentures issued by Liberty Media; and
-- The PPLUS Trust Series LMG-4 rating is weak-linked to
$35 million 8.25% senior debentures issued by Liberty Media.
Ratings affirmed and removed from creditwatch negative:
PreferredPLUS Trust Series LMG-1 $126 million preferredplus
8.75% trust certificates
Rating
------
Class To From
----- -- ----
Certificates BB+ BB+/Watch Neg
PreferredPLUS Trust Series LMG-2 $31 million trust certificates
Rating
------
Class To From
----- -- ----
Certificates BB+ BB+/Watch Neg
PPLUS Trust Series LMG-3 $30 million certificates series LMG-3
Rating
------
Class To From
----- -- ----
A BB+ BB+/Watch Neg
B BB+ BB+/Watch Neg
PPLUS Trust Series LMG-4 $35 million PPLUS trust certificates
series LMG-4
Rating
------
Class To From
----- -- ----
A BB+ BB+/Watch Neg
B BB+ BB+/Watch Neg
LIONBRIDGE TECH: Refinancing Prompts S&P to Withdraw Ratings
------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its ratings on
Lionbridge Technologies Inc., following the refinancing of its
existing $125 million credit facilities with a new, $100 million
revolving credit facility. Standard & Poor's does not rate the
new credit facility.
MAJESTIC STAR: Sept. 30 Balance Sheet Upside-Down by $130 Million
-----------------------------------------------------------------
The Majestic Star Casino, LLC, filed its financial statements for
the quarter ended Sept. 30, 2006, with the Securities and Exchange
Commission.
The company reported a $5,793,076 net loss on $103,664,053 of
gross revenues for the three months ended Sept. 30, 2006, versus a
$97,060 net loss on $76,420,348 of gross revenues for the three
months ended Sept. 30, 2005.
At Sept. 30, 2006, the company's balance sheet showed $506,364,664
in total assets and $636,406,636 in total liabilities resulting in
a stockholders' deficit of $130,041,972.
The company currently has $300 million of 9.5% senior secured
notes, due October 2010, and $200 million of 9.75% senior notes,
due January 2011, outstanding. In addition, the company has an
$80 million revolving credit facility that will mature in April
2010.
Management reports that competition in the markets remains intense
and continued aggressive marketing by competitors in all the
markets will require them to maintain a high level of marketing
and promotional expenses. If the level of competition in any of
the markets increases, the company's financial performance and
cash flows may be negatively impacted.
A full-text copy of the regulatory filing is available for free at
http://ResearchArchives.com/t/s?17d1
Majestic Star Casino, LLC -- http://www.majesticstar.com/directly
and indirectly owns and operates riverboat casinos in Gary,
Indiana, Tunica, Mississippi, and Black Hawk, Colorado. Majestic
Star Holdco, LLC, owns 100% of Majestic Star Casino, LLC.
MERIDIAN AUTOMOTIVE: Emerges from Chapter 11 Protection
-------------------------------------------------------
Meridian Automotive Systems, Inc., disclosed that its Plan of
Reorganization, previously confirmed by the U.S. Bankruptcy Court
for the District of Delaware, has become effective on Dec. 29,
2006, and that Meridian has emerged from Chapter 11. The company
also reported, in connection with their emergence from Chapter 11,
it has entered into a $167 million exit financing facility with
Deutsche Bank.
"This is an exciting day for Meridian Automotive Systems. We are
pleased to have successfully completed our restructuring and to
emerge as a stronger company with significantly less debt and
increased liquidity, two factors which will contribute to our
long-term success in the automotive industry," Richard E. Newsted,
Meridian's President and CEO, said. "I would like to again thank
all of the Meridian associates for their hard work and our valued
customers, suppliers and creditors for their unwavering support
during our reorganization."
As reported in the Troubled Company Reporter on Dec. 26, 2006, as
of the Effective Date, the Distributions and rights provided
in the Plan and the treatment of claims and interests under the
Plan will be in exchange for and in complete satisfaction,
discharge and release of all claims, and satisfaction or
termination of all Prepetition Meridian Interests, including any
interest accrued on claims from and after the Petition Date.
In addition, all entities will be precluded from asserting
against the Debtors, the Reorganized Debtors, or their successors
or property, any other or further claims, demands, debts, rights,
causes of action, liabilities or equity interests based upon any
act, omission, cause, transaction, state of facts, or other
activity of any kind or nature that occurred prior to the
Effective Date.
Furthermore, all persons who have held, hold, or may hold claims
against or interests in the Debtors will be permanently enjoined
from:
-- commencing or continuing any action against the Reorganized
Debtors and their estates
-- enforcing, attaching, collecting or recovering in any
manner any judgment, award, decree or order;
-- creating, perfecting or enforcing any lien or encumbrance
on the Reorganized Debtors and their estates; and
-- asserting a set-off or right of subrogation of any kind
against any debt, liability or obligation due to the
Debtors.
Any and all professional persons employed by the Debtors or the
Official Committee of Unsecured Creditors will have until
Feb. 12, 2007, to file and serve their applications for final
allowance of fees and expenses.
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. Judge Walrath has confirmed the Revised Fourth
Amended Reorganization Plan of Meridian.
MM2 GROUP: Incurs $1.3 Million Net Loss in 2006 First Quarter
-------------------------------------------------------------
MM2 Group Inc. reported a $1.3 million net loss on $26,141 of
revenues for the first fiscal quarter ended Sept. 30, 2006,
compared with a $549,615 net loss on zero revenues for the same
period in 2005.
At Sept. 30, 2006, the company's balance sheet showed $1 million
in total assets and $4 million in total liabilities, resulting in
a $2.9 million stockholders' deficit.
The company's balance sheet at Sept. 30, 2006, also showed
strained liquidity with $792,059 in total current assets available
to pay $3.1 million in total current liabilities.
A Full-text copy of the company's quarterly report is available
for free at http://researcharchives.com/t/s?17c1
Going Concern
Bagel, Josephs, Levine & Company, LLC, in Gibbsboro, New Jersey,
raised substantial doubt about MM2 Group, Inc.'s ability to
continue as a going concern after auditing the company's
consolidated financial statements for the year ended June 30,
2006. The auditor pointed to the company's substantial
accumulated deficits and operating losses.
Based in Matawan, New Jersey, MM2 Group, Inc., through its
subsidiary, Genotec Nutritionals, Inc, manufactures and
distributes nutritional supplements and vitamins. The company,
founded in 2004, intends to develop businesses in the
nutraceuticals markets via internal growth or product development
or by acquisition of other companies that operate in that market.
MOHEGAN TRIBAL: Sept. 30 Balance Sheet Upside-Down by $38.9 Mil.
----------------------------------------------------------------
Mohegan Tribal Gaming Authority reported $154.9 million of net
income on $1.4 billion of net revenues for the fiscal year ended
Sept. 30, 2006, compared with $23.7 million of net income on
$1.3 billion of revenues for the fiscal year ended Sept. 30, 2005.
Net revenues for the fiscal year ended Sept. 30, 2006 increased
primarily as a result of a 6.2% growth in gaming and a 5.3% growth
in non-gaming revenues at Mohegan Sun, and an increase in net
revenues associated with a full year of operations at Pocono Downs
and the off-track wagering facilities acquired in January 2005.
The increase in net revenues for the fiscal year ended
Sept. 30, 2006 was also due to a decrease in promotional
allowances compared to the prior fiscal year.
Net income for the fiscal year ended Sept. 30, 2006 compared to
the prior fiscal year increased primarily due to the increase in
income from operations at Mohegan Sun and a $24.5 million gain
recorded in connection with the amendment of the Pocono Downs
purchase agreement with the seller, a subsidiary of Penn National
Gaming Inc.
Pursuant to the amendment, in exchange for the consent of the
company to modify certain provisions of the purchase agreement,
including the elimination of the company's post-closing
termination rights, the company will receive an aggregate refund
of $30 million of the original purchase price for the Pocono Downs
entities, payable in five annual installments of $7 million,
$7 million, $6.5 million, $6 million and $3.5 million on
Nov. 14, 2007, 2008, 2009, 2010 and 2011, respectively.
Income from operations for the fiscal year ended Sept. 30, 2006,
compared to the prior fiscal year increased as a result of the
growth in net revenues and a significant decrease of $84.2 million
in the non-cash relinquishment liability reassessment charge.
At Sept. 30, 2006, the company's balance sheet showed $1.91
billion in total assets, $1.95 billion in total liabilities, and
$3.5 million in minority interest, resulting in a $38.9 million
total stockholders deficit.
The company's balance sheet at Sept. 30, 2006, also showed
strained liquidity with $137.7 million in total current assets
available to pay $272.3 million in total current liabilities.
Sources and Uses of Cash
As of Sept. 30, 2006, the company had cash and cash equivalents of
$75.2 million.
Net cash provided by operating activities increased to
$250.9 million compared to $247.1 million in fiscal 2005. The
increase in net cash provided by operating activities for the
fiscal year ended Sept. 30, 2006, is attributable primarily to the
increase in operating income after adjustments for non-cash items,
partially offset by lower working capital requirements.
Net cash used in financing activities in fiscal 2006 was
$147.3 million compared to net cash provided by financing
activities of $99.7 million in fiscal 2005. The increase in net
cash used in financing activities for fiscal year 2006 is
attributable primarily to a change in debt activity from total net
borrowings of $213.2 million for the fiscal 2005 to total debt
payments of $15 million for the fiscal 2006.
Net cash used in investing activities was $100.8 million in fiscal
2006 compared to $335.2 million in fiscal 2005. The change in
debt activity and decrease in net cash used in investing
activities for the fiscal 2006 is attributable primarily to the
acquisition of Pocono Downs in fiscal 2005 for approximately
$280 million.
Full-text copies of the company's consolidated financial
statements for the year ended Sept. 30, 2006, are available for
free at http://researcharchives.com/t/s?17cd
About Mohegan Tribal Gaming Authority
Mohegan Tribal Gaming Authority -- http://mtga.com/-- is an
instrumentality of the Mohegan Tribe of Indians of Connecticut, a
federally recognized Indian tribe with an approximately 507-acre
reservation situated in southeastern Connecticut, adjacent to
Uncasville, Connecticut.
The Authority operates Mohegan Sun, a gaming and entertainment
complex that is situated on a 240-acre site on the Tribe's
reservation and, through its subsidiary, Downs Racing LP, owns and
operates Mohegan Sun at Pocono Downs, a gaming and entertainment
facility offering slot machines and harness racing in Plains
Township, Pennsylvania and five off-track wagering facilities
located elsewhere in Pennsylvania.
Mohegan Sun currently operates in an approximately 3 million
square foot facility, which includes the Casino of the Earth,
Casino of the Sky, the Shops at Mohegan Sun, a 10,000-seat Arena,
a 350-seat Cabaret, meeting and convention space and the
approximately 1,200-room luxury Sky hotel.
MONEY CENTERS: Completes New $7.25 Million Credit Facility
----------------------------------------------------------
Money Centers of America, Inc., completed a $7.25 million credit
facility replacing its existing facility with Baena Advisors and
Mercantile Capital, which represents the second phase of the
company's planned recapitalization.
"We are excited to have finalized this credit facility before year
end as this was a high priority for our 2006 business plan," said
Jay Walsh, Chief Financial Officer of Money Centers of America.
"With long term debt in place we can now confidently pursue the
next phase of our recapitalization which should lower our cost of
capital even more."
The new credit facility improves cash flow $700,000, net income by
$200,000 and shifts $7.2 million from short to long-term debt.
About Money Centers
Based in King of Prussia, Pennsylvania, Money Centers of America,
Inc. (OTC Bulletin Board: MCAM) -- http://www.moneycenters.com/--
provides cash access and Transaction Management Systems for the
gaming industry, utilizing a customer-centric approach that is
aimed at leveraging technology, generating value, and creating
measurable results in profitability, customer satisfaction and
loyalty.
Going Concern Doubt
As reported in the Troubled Company Reporter on May 8, 2006,
Sherb & Co., LLP, in Boca Raton, Florida, raised substantial doubt
about Money Centers of America, 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 losses from operations, working capital
deficit, stockholders' deficit, and accumulated deficit.
NANTUCKET CLO: Moody's Rates $12.6 Million Notes at Ba2
-------------------------------------------------------
Moody's Investors Service has assigned these ratings to Notes
issued by Nantucket CLO I Ltd.:
(1) Aaa to $215,700,000 Class A Senior Secured Floating Rate
Notes, Due 2020;
(2) Aa2 to $15,000,000 Class B Senior Secured Floating Rate
Notes, Due 2020;
(3) A2 to $18,000,000 Class C Senior Secured Deferrable
Floating Rate Notes, Due 2020;
(4) Baa2 to $15,600,000 Class D Secured Deferrable Floating
Rate Notes, Due 2020 and
(5) Ba2 to $12,600,000 Class E Secured Deferrable Floating
Rate Notes, Due 2020.
The Moody's ratings of the Notes address the ultimate cash receipt
of all required interest and principal payments, as provided by
the Notes' governing documents, and are based on the expected loss
posed to Noteholders, relative to the promise of receiving the
present value of such payments.
The ratings reflect the risks due to the diminishment of cash flow
from the underlying portfolio consisting primarily of U.S. Dollar
denominated senior secured loans, second lien loans, structured
finance securities and mortgage-backed securities due to defaults,
the transaction's legal structure and the characteristics of the
underlying assets.
Fortis Investment Management USA, Inc. will manage the selection,
acquisition and disposition of collateral on behalf of the Issuer.
NEOPLAN USA: Court Confirms Chapter 11 Plan of Reorganization
-------------------------------------------------------------
The Hon. Brendan Linehan Shannon the U.S. Bankruptcy Court for the
District of Delaware confirmed Neoplan USA Corporation's chapter
11 plan of reorganization, The Associated Press reports.
According to the news, the Plan contemplates that all profitable
parts division would be sold and then go out of business.
Pursuant to the Plan, Chief Executive Harold Boade would remain to
oversee the sale of the company's parts-and-service assets based
in Honeybrook, Pennsylvania, following the company's exit from
bankruptcy.
AP says that the company owed a group of senior secured lenders,
headed by the Bank of New York, with $18 million and $41 million
to unsecured creditors.
Treatment of Claims
Under the Plan, Administrative Claims, Other Priority
Claims and Other Secured Claims will be paid in full and in cash.
Priority Tax Claims will also be paid in full and in cash.
Holders of Senior Secured Lender Claims will receive:
* a pro rata share of the available assets and remaining
assets, and
* the Senior Secured Lender Release.
Holders of General Unsecured Claims will receive a pro rata share
of available assets and remaining assets, after full payment of
Senior Secured Lender Claims.
Interest and Interest Related Claims will be cancelled and holders
will receive nothing under the plan.
Headquartered in Denver, Colorado, Neoplan USA Corporation
manufactures standard floor buses, low floor buses, and
articulated buses. Neoplan USA licenses its designs from the
German corporation, Neoplan. Neoplan USA is entirely separate
from Neoplan in Germany. The Company, its parent, IAP Acquisition
Corporation, and two affiliates, filed for chapter 11 protection
on Aug. 17, 2006 (Bankr. D. Del. Lead Case No. 06-10872). Leslie
Carol, Esq., and Tobey M. Daluz, Esq., at Heilman Ballard Spahr
Andrews & Ingersoll, LLP, represents the Debtors. The Official
Committee of Unsecured Creditors selects David M. Fournier, Esq.,
David B. Stratton, Esq., and Evelyn J. Meltzer, Esq., at Pepper
Hamilton LLP. When Neoplan USA filed for protection from its
creditors, it listed $13,696,911 in total assets and $59,009,471
in total debts.
NORD RESOURCES: Platinum Merger Didn't Close on December 22
-----------------------------------------------------------
Nord Resources Corporation's chairman of the board of directors,
Ronald A. Hirsch, reported that the closing of the proposed
acquisition of Nord by Platinum Diversified Mining, Inc. in an
all-cash merger transaction did not take place as scheduled on
Dec. 22, 2006.
Platinum has advised the company that its inability to close the
Merger on the scheduled closing date results from the fact that
Platinum does not have formal loan documentation in place for its
project financing. Platinum has advised Nord that it anticipates
to have the formal loan documentation in place in middle to late
January 2007, and expects to be in a position to close once it is
in place.
The company disclosed that it has advised Platinum that it is its
position that Platinum should have completed the Merger on
December 22, in accordance with the provisions of the Agreement
and Plan of Merger. Nord has been advised by Platinum that it
disagrees with Nord's position that the Merger should have closed
on December 22.
Commenting on the developments under the Merger Agreement,
Mr. Hirsch said: "While not closing on the scheduled closing date
is obviously disappointing, we remain confident in our ability to
complete a transaction that will maximize shareholder value. For
now, we believe that completing the Merger on the terms agreed to
by all parties represents the best alternative for Nord and its
shareholders. We will obviously keep all shareholders apprised as
developments occur under the Merger Agreement."
Based in Tucson, Ariz., Nord Resources Corporation (Pink Sheets:
NRDS) -- http://www.nordresources.com/-- is an emerging copper
producer, which controls a 100% interest in the Johnson Camp SX-EW
copper project in Arizona. Nord's near term objective is to
resume mining and leaching operations at the Johnson Camp mine,
which has been on care and maintenance status since August 2003.
Nord has decided to proceed with its mine plan bases on an updated
feasibility study that was completed in October 2005, subject to
raising sufficient financing.
Going Concern Doubt
As reported in Aug. 3, 2006, Mayer Hoffman McCann PC expressed
substantial doubt about Nord'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 operating losses.
NORD RESOURCES: Receives $670,000 from Claims Settlements Proceeds
------------------------------------------------------------------
Nord Resources Corporation's chairman of the board of directors,
Ronald A. Hirsch, disclosed that the company had received $475,000
as settlement proceeds in Nord's claim In re ASARCO, LLC as debtor
in bankruptcy, and a further $195,000 from Oconee in connection
with an earlier dispute involving electric power credits.
The company also disclosed that American Stock Transfer & Trust
Company confirmed receipt of the final $250,000 deposit from
Platinum USA into the Deposit Fund established under the Agreement
and Plan of Merger dated Oct. 23, 2006 by and among Platinum
Diversified Mining, Inc., Platinum Diversified Mining USA, Inc.,
PDM Merger Corp. and Nord. The Deposit Fund, which now totals
$1 million, will be applied by AST to the merger consideration
funds to be deposited by Platinum and Platinum USA for the
purposes of paying the merger consideration, in the event of the
consummation of the merger.
Commenting on the recent corporate developments, Mr. Hirsch said:
"We are pleased that we have been able to put the ASARCO and
Oconee claims behind us and in the process have improved our
working capital position. We are also pleased that PDM has made
the final $250,000 payment into the Deposit Fund, which we see as
a positive sign that PDM wants to see the merger transaction
close, notwithstanding the recently announced events concerning
the Merger Agreement."
Based in Tucson, Ariz., Nord Resources Corporation (Pink Sheets:
NRDS) -- http://www.nordresources.com/-- is an emerging copper
producer, which controls a 100% interest in the Johnson Camp SX-EW
copper project in Arizona. Nord's near term objective is to
resume mining and leaching operations at the Johnson Camp mine,
which has been on care and maintenance status since August 2003.
Nord has decided to proceed with its mine plan bases on an updated
feasibility study that was completed in October 2005, subject to
raising sufficient financing.
Going Concern Doubt
As reported in Aug. 3, 2006, Mayer Hoffman McCann PC expressed
substantial doubt about Nord'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 operating losses.
PILGRIM'S PRIDE: Closes Tender Offer for 88.87% Gold Kist Shares
----------------------------------------------------------------
Pilgrim's Pride Corporation disclosed that the expiration of its
initial offer to acquire all of the outstanding shares of Gold
Kist Inc. common stock for $21 per share in cash and the
commencement of a subsequent offering period. Pilgrim's Pride has
accepted all shares validly tendered and not properly withdrawn
and expects to complete the transaction in early January 2007.
The subsequent offering period will expire at 5:00 p.m., New York
City Time, on Friday, Jan. 5, 2007, unless extended.
As reported in the Troubled Company Reporter on Dec. 13, 2006, the
initial offer and withdrawal rights expired at 5:00 p.m., New York
City Time, on Wednesday, Dec. 27, 2006, at which time a total of
45,343,812 shares of Gold Kist common stock, or approximately
88.87% of Gold Kist's outstanding shares, had been tendered and
not withdrawn. Of those shares tendered, 2,366,878 shares of Gold
Kist's outstanding common stock were tendered subject to
guaranteed delivery. All shares validly tendered and not properly
withdrawn prior to the expiration of the offer have been accepted
for payment by Pilgrim's Pride.
"The completion of this tender offer is a significant milestone
for Pilgrim's Pride," said O.B. Goolsby, Jr., Pilgrim's Pride
president and chief executive officer. "We look forward to
beginning 2007 as a much stronger company, with industry-leading
market share, a broad and growing customer base and a balanced
portfolio of fresh chicken and value-added products. We are now
ready to begin realizing the compelling strategic value and
benefits we envisioned from this acquisition and look forward to
setting a new standard in the chicken industry."
As of 9:00 a.m., New York City Time, on Dec. 28, 2006, Pilgrim's
Pride has commenced the subsequent offering period for all
remaining shares that have not yet been tendered. The purpose of
the subsequent offering period is to enable Gold Kist stockholders
who did not tender during the initial offering period to
participate in the offer and receive the all-cash $21 offer price
on an expedited basis. Pilgrim's Pride urges Gold Kist
stockholders to tender their shares during the subsequent offering
period. Pilgrim's Pride will immediately accept all shares validly
tendered during the subsequent offering period as they are
tendered, and will pay for such shares promptly.
Stockholders who tender their shares during the subsequent
offering period will receive the same $21 all-cash per share
consideration paid during the initial offering period. Procedures
for tendering shares during the subsequent offering period are the
same as during the initial offering period, except
(i) shares cannot be delivered through the guaranteed delivery
procedure and
(ii) shares tendered during the subsequent offering period may
not be withdrawn.
As previously reported, Pilgrim's Pride and Gold Kist entered into
a definitive merger agreement on Dec. 3, 2006, under which
Pilgrim's Pride agreed to acquire all of the outstanding shares of
Gold Kist common stock for $21 per share in cash. The transaction
was unanimously approved by the boards of directors of both
Pilgrim's Pride and Gold Kist and has a total equity value of
approximately $1.1 billion, plus the assumption or refinancing of
approximately $144 million of Gold Kist's debt. Upon expiration
of the subsequent offering period, Pilgrim's Pride intends to
complete the acquisition of Gold Kist through a merger of its
acquisition vehicle, Protein Acquisition Corporation, into Gold
Kist, in which all Gold Kist shares not tendered into Pilgrim's
Pride's offer (other than shares held in the treasury of Gold Kist
or held by Pilgrim's Pride or any of its subsidiaries) will be
converted into the right to receive $21 per share. Following the
merger, Gold Kist will be a wholly owned subsidiary of Pilgrim's
Pride.
The company also completed its tender offer to purchase and
related consent solicitation for Gold Kist's outstanding 10-1/4%
Senior Notes due March 15, 2014. The debt tender offer was made
in connection with Pilgrim's Pride's acquisition of Gold Kist. As
of 5:00 p.m., New York City Time, Dec. 27, 2006, the company had
received tenders and related consents with respect to 100% of the
aggregate principal amount of the outstanding Gold Kist Notes, all
of which were accepted for payment.
Baker & McKenzie LLP and Morris, Nichols, Arsht & Tunnell, LLP are
acting as legal counsel and Credit Suisse, Legacy Partners Group
LLC and Lehman Brothers Inc. are acting as financial advisors to
Pilgrim's Pride. Innisfree M&A Incorporated is acting as
information agent for Pilgrim's Pride's offer.
About Gold Kist
Based in Atlanta, Georgia, Gold Kist Incorporated (NASDAQ: GKIS)
-- http://www.goldkist.com/-- operates a fully integrated chicken
production, processing and marketing business. Gold Kist's
production operations include nine divisions located in Alabama,
Florida, Georgia, North Carolina and South Carolina.
About Pilgrim's Pride
Headquartered in Pittsburgh, Texas, Pilgrim's Pride Corp.
(NYSE: PPC) -- http://www.pilgrimspride.com/-- produces,
distributes and markets poultry processed products through
retailers, foodservice distributors and restaurants in the United
States, Mexico and in Puerto Rico. Pilgrim's Pride employs
approximately 40,000 people and has major operations in Texas,
Alabama, Arkansas, Georgia, Kentucky, Louisiana, North Carolina,
Pennsylvania, Tennessee, Virginia, West Virginia, Mexico and
Puerto Rico, with other facilities in Arizona, Florida, Iowa,
Mississippi and Utah.
* * *
Moody's Investors Service's held its Ba2 Corporate Family Rating
for Pilgrim's Pride Corp. In addition, Moody's revised or held
its probability-of-default ratings and assigned loss-given-default
ratings on the company's note issues, including an LGD6 rating on
its $100 million 9.25% Sr. Sub. Global Notes Due Nov. 15, 2013,
suggesting noteholders will experience a 95% loss in the event of
a default.
As reported in the Troubled Company Reporter on Dec. 6, 2006,
Standard & Poor's Ratings Services reported that its 'BB'
corporate credit rating and other ratings on the second-largest
U.S. poultry processor, Pilgrim's Pride Corp., remain on
CreditWatch with negative implications, where they were originally
placed Aug. 21, 2006.
POWER EFFICIENCY: Posts $1.1 Mil. Net Loss in FY 2006 3rd Quarter
-----------------------------------------------------------------
Power Efficiency Corp. filed its third quarter financial
statements for the three months ended Sept. 30, 2006, with
the Securities and Exchange Commission, reporting a $1,138,414
net loss on $79,554 of revenues for the three months ended
Sept. 30, 2006.
At Sept. 30, 2006, the company's balance sheet showed $2,437,480
in total assets and $3,380,099 in total liabilities resulting in
$942,619 stockholders' deficit.
The company's September 30 balance sheet also showed strained
liquidity with $323,709 in total current assets available to pay
$3,380,099 in total current liabilities coming due within the next
12 months.
A full-text copy of the regulatory filing is available for free
at http://ResearchArchives.com/t/s?17d0
Going Concern Doubt
Sobel & Co., LLC, in Livingston, New Jersey, the company's
external auditor, raised substantial doubt about the Company's
ability to continue as a going concern after it audited Power
Efficiency Corp.'s financial statements for the year ended
Dec. 31, 2005. The auditor pointed to the Company's
recurring losses from operations and insufficient liquidity.
Power Efficiency Corp. -- http://www.powerefficiencycorp.com/--
designs, develops, markets and sells proprietary solid state
electrical components to reduce energy consumption in alternating
current induction motors.
ROWE COMPANIES: Court OKs Lexington-Rowe as Stalking-Horse Bidder
-----------------------------------------------------------------
The Honorable Stephen S. Mitchell of the U.S. Bankruptcy Court for
the Eastern District of Virginia granted Lexington-Rowe Furniture,
Inc., an affiliate of Sun Capital Partners, as the lead bidder for
The Rowe Companies, The Associated Press reports.
According to AP, Judge Mitchell authorized the "stalking horse"
agreement for the Jan. 18 auction despite of the unsecured
creditors' complaints.
The company's creditors disclosed in court documents that the
$30 million deal from Lexington-Rowe Furniture, Inc., an affiliate
of Sun Capital, was too low, citing that if sold in pieces, the
unit could get closer to $55 million.
As reported in the Troubled Company Reporter on Dec. 6, 2006,
Sun Capital submitted a formal letter of intent whereby it is
contemplated that Lexington-Rowe would be confirmed as the
stalking horse bidder to acquire, through a Section 363 Bankruptcy
Code sale process, substantially all of the assets of The Rowe
Companies, Rowe Furniture, Inc., and certain of other affiliated
debtors, but specifically excluding Storehouse Inc.
Initial bids must be submitted by Jan. 17 with a $3,000 deposit.
AP states that if Lexington-Rowe won't be the winning bidder at
the auction, the buyout firm would be eligible for a $450,000
breakup fee and $400,000 as reimbursement for expenses.
The Court will convene a hearing at Jan. 19, 2006, to review the
auction results.
Headquartered in McLean, Virginia, The Rowe Companies
-- http://www.therowecompanies.com/-- manufactures
upholstered retail home and office furniture, interior
decorations, tableware, lighting fixtures, and other interior
design accessories. The company owns 100% of stock of
manufacturing and retail subsidiaries, Rowe Furniture
-- http://www.rowefurniture.com/-- and Storehouse, Inc.
-- http://www.storehousefurniture.com/
The company and its two of its debtor-affiliates filed for chapter
11 protection on Sept. 18, 2006 (Bank. E.D. Va. Case Nos. 06-11142
to 06-11144). Dylan G. Trache, Esq., H. Jason Gold, Esq., and
Valerie P. Morrison, Esq., at Wiley Rein & Fielding LLP, represent
the Debtors. When the Debtors filed for protection from their
creditors, The Rowe Companies listed total assets of $130,779,655
and total debts of $93,262,974; Rowe Furniture estimated assets
between $50 million and $100 million and debts between $10 million
and $50 million; and Storehouse, Inc. estimated assets and debts
between $10 million and $50 million. The Debtors' exclusive
period to file a chapter 11 plan expires on Jan. 16, 2007.
SEAGATE TECH: Signs Definitive Pact to Buy EVault for $185 Million
------------------------------------------------------------------
Seagate Technology signed a definitive agreement to acquire, in a
cash transaction valued at approximately $185 million, EVault,
Inc., as part of its effort to extend the company's storage
solutions offerings and strengthen the Seagate Services group.
The acquisition is subject to various standard closing conditions,
including applicable regulatory approvals, and is expected to
close in the third quarter of Seagate's fiscal year 2007.
"The announcement highlights a strategic next step into services,
which is a natural extension of Seagate's core business and will
leverage our brand leadership and channel expertise to deliver
solutions to the SMB market," Bill Watkins, chief executive
officer, said. "Over the past three years, Seagate has been
executing a strategy designed to broaden its customer base and
increase growth opportunities by expanding beyond its core hard
disc drive business into the broader storage solutions category.
Our objective for Seagate Services is to become a leading provider
of services to manage and protect our customers' digital content
throughout its lifecycle."
With the acquisition of EVault, Seagate Services will provide the
following primary solutions:
-- Data recovery through professional in-lab and on-site
retrieval of content for corrupted or inaccessible storage
devices - all media formats and all brands.
-- Online backup, archival, and recovery services for
designated user and application data. These services are
targeted at the SMB market, and will focus on customers with
limited IT infrastructure or appropriate resources.
About EVault
Based in Emeryville, Ca., EVault, Inc., is a privately-held
company that supplies online network backup, recovery and data
protection solutions for SMB and remote enterprise computing.
About Seagate
Headquartered in Scotts Valley, Ca., Seagate Technology
(NYSE: STX) -- http://www.seagate.com/-- designs, manufactures
and markets hard disc drives. The company provides products for a
wide-range of Enterprise, Desktop, Mobile Computing, and Consumer
Electronics applications.
* * *
As reported in the Troubled Company Reporter on Sept. 13, 2006,
Moody's Investors Service affirmed the Ba1 Corporate Family Rating
of Seagate Technology HDD Holdings.
At the same time, Moody's assigned new ratings to a proposed new
debt issuance of $1.25 billion to finance Seagate's recently
announced $2.5 billion stock buyback program, as well as refinance
Seagate's existing $400 million 2009 notes. Ratings assigned
include a Ba1 rating on Floating rate notes due 2009, Ba1 rating
on Senior notes due 2011 and 2016.
TANK SPORTS: Forms Strategic Alliance with Long SA de C.V.
----------------------------------------------------------
Tank Sports signed an agreement to form a strategic alliance with
Mexico's Long SA de C.V. for improving competitiveness and
expanding upon the global market.
The cooperative aspects of the alliance between the two firms
include new product developmental research and sharing of
resources, the company also disclosed.
The company further disclosed that after Long's reorganization,
the two firms will start preparing for a merger.
About Long SA de C.V.
Long SA de C.V. is a motorcycle manufacturer in Mexico. With 250
employees, the company is a government approved motorcycle
manufacturer in Mexico and has received zero custom tax privilege.
Long has over 200 dealerships.
Long has started importing motorcycles into Mexico in 1996 and
started building a factory in 2000. The company has obtained two
complete production lines that include a metal processing plant, a
welding and chemical processing plant, powder spray painting,
assembling line, quality control, technical and service
department. Tank Sports chairman Jiangyong Ji and president Jing
Jing Long combined have over 60% ownership of Long.
About Tank Sports
Headquartered in El Monte, California, Tank Sports, Inc.,
(OTCBB: TNSP) -- http://www.tank-sports.com/-- develops,
engineers, and markets high-performance on-road motorcycles &
scooters, off-road all-terrain vehicles (ATVs), dirt bikes and Go
Karts through OEMs in China. The company's motorcycles and ATVs
products are manufactured in China and Mexico.
Going Concern Doubt
Kabani & Company, Inc. in Los Angeles, California, raised
substantial doubt about Tank Sports, Inc.'s ability to continue as
a going concern after auditing the company's financial statements
for the year ended Feb. 28, 2006. The auditor pointed to the
company's net loss and accumulated deficit.
TERAX ENERGY: Posts $12.1 Million Net Loss in 2006 First Quarter
----------------------------------------------------------------
Terax Energy Inc. incurred a $12.1 million net loss on $189,139 of
revenues for the first fiscal quarter ended Sept. 30, 2006,
compared with a $493,177 net loss on zero revenues for the same
period in 2005, an increase net loss of $12.6 million.
Of the gain, $14,320,866 was attributable to non-cash income
associated with a gain on derivative liability offset by $200,127
non-cash costs associated with depletion and deprecation expenses.
At Sept. 30, 2006, the company's balance sheet showed $16.5
million in total assets and $11.3 million in total liabilities,
resulting in a $5.1 million stockholders' deficit.
The company's balance sheet at Sept. 30, 2006, also showed
strained liquidity with $315,293 in total current assets available
to pay $11.3 million in total current liabilities.
A Full-text copy of the company's quarterly report is available
for free at http://researcharchives.com/t/s?17d2
Going Concern Doubt
As reported in the Troubled Company Reporter on Oct. 18, 2006,
Malone & Bailey, PC, in Houston, Texas, raised substantial doubt
about Terax Energy's ability to continue as a going concern
after auditing the Company's consolidated financial statements for
the year ended June 30, 2006. The auditor pointed to the
Company's recurring operating losses and working capital
deficiency.
About Terax Energy
Dallas, Tex.-based Terax Energy, Inc., is an independent oil and
gas exploration and development company. The Company's principal
properties consist of two large blocks of oil and gas leases. One
lease covers approximately 11,300 gross acres in Erath County,
Texas. Another lease covers a block of approximately 16,200 gross
acres located in Comanche County, Texas. Both leases permit the
Company to drill and develop the Barnett Shale formation
underlying the lease acreage.
THOMAS EQUIPMENT: Units Submit Plan of Arrangement Under CCAA
-------------------------------------------------------------
Thomas Equipment, Inc. disclosed that its subsidiary, Pneutech
Inc., and Pneutech's subsidiaries Rousseau Controls Inc. and
Hydramen Fluid Power Limited, have submitted a plan of arrangement
to their creditors under the Companies' Creditors Arrangement Act.
A copy of the proposed plan of arrangement has been filed with the
Superior Court of Quebec. A meeting of creditors to approve the
plan will be held in Montreal on Feb. 2, 2007; if approved, the
plan would be submitted to the Superior Court of Quebec for
ratification shortly thereafter.
The proposed plan of arrangement provides that secured creditors
are to be paid pursuant to existing terms or on terms to be agreed
with them. Unsecured creditors will receive the full principal
amount of their claims, without interest, with at least half the
amount payable shortly after approval of the plan and the balance
spread over sixteen quarters. The plan of arrangement is
contingent upon two sources of funding: a new credit facility and
an investment, which together would provide $6 million in
available funds over and above what is required to repay the
companies' first-ranking interim lender in full.
The companies have continued to operate throughout the
restructuring process, and enjoy strong support from their
lenders, suppliers and customers.
According to the companies' president, Bernard Jett,, "The filing
of the plan of arrangement is an important step toward Pneutech's
emergence from the restructuring process. Along with the hiring
of new employees and our new prospective sources of funding, the
plan of arrangement sends a statement to our customers that
Pneutech is on a solid footing and able to fill orders today and
in the long term."
About Thomas Equipment
Headquartered in Milwaukee, Wisconsin, Thomas Equipment, Inc.
(PINKSHEETS: THME) -- http://www.thomas-equipment.com/--
manufactures skid steer and mini skid steer loaders as well as
attachments, mobile screening plants and six models of mini
excavators. The Company distributes its products through a
worldwide network of distributors and wholesalers. In addition,
the Company's wholly owned subsidiaries manufacture specialty
industrial and construction products, a complete line of potato
harvesting and handling equipment, fluid power components,
pneumatic and hydraulic systems, spiral wound metal gaskets, and
packing material.
At March 31, 2006, Thomas Equipment Inc.'s balance sheet showed a
stockholders' deficit of $31,289,000, compared to a $67,129,000
deficit at June 30, 2005.
TRANSATLANTIC PETROLEUM: Sells Bayou Couba Assets to Dune Energy
----------------------------------------------------------------
TransAtlantic Petroleum Corp. sold its interests in the Bayou
Couba prospect and in debentures it held of American Natural
Energy Corporation, the operator of the Bayou Couba prospect, to
Dune Energy, Inc. for total consideration of $2 million.
The sale included TransAtlantic's 10% working interest and related
interests in the Bayou Couba project, St. Charles Parish,
Louisiana held by its subsidiary, TransAtlantic Petroleum (USA)
Corp., and certain 8% Convertible Secured Debentures issued by
ANEC in the principal face amount of $3 million held by
TransAtlantic. The Debentures have matured and are now in
default. TransAtlantic previously reserved against the Debentures
reducing their value on its books to $900,000.
In addition, TransAtlantic continues to own 2,237,136 common
shares of ANEC, which represents approximately 4.4% of the issued
and outstanding common shares of ANEC. TransAtlantic acquired and
holds such common shares for investment purposes and has no
current plans to acquire additional securities, or control over
additional securities, of ANEC, although TransAtlantic may acquire
or dispose of securities of ANEC from time to time in the future.
TransAtlantic Petroleum Corp. -- http://www.tapcor.com/-- is
engaged in the exploration, development and production of crude
oil and natural gas in the USA and has interests in Morocco,
Turkey, Romania and the North Sea.
WASHINGTON MUTUAL: S&P Junks Rating on Class L-B-5 Certificates
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on classes
L-B-4 and L-B-5 from Washington Mutual MSC Mortgage Pass-Through
Certificates Series 2005-RA1. Concurrently, the rating on class
L-B-4 remains on CreditWatch with negative implications, as does
the rating on class L-B-3. At the same time, the rating on class
L-B-5 was removed from CreditWatch negative.
All three ratings were placed on CreditWatch with negative
implications on Sept. 18 2006 and the ratings on 11 classes were
affirmed.
The downgrades and the continued CreditWatch negative placements
reflect the deteriorating credit support for the classes. Credit
support for this transaction is provided by subordination. During
the December 2006 remittance period, the supporting pool for the
fixed-rate loan group incurred a loss of $36,774, which reduced
the credit support for classes L-B-4 and L-B-5 to $113,580 and
$477, respectively.
According to the Dec. 26, 2006, distribution report, foreclosures
and REOs in the fixed-rate loan group amounted to $418,078 and
$68,692, respectively. Potential losses from these loans could
continue to deplete credit enhancement for these classes.
Standard & Poor's will continue to closely monitor the performance
of classes L-B-3 and L-B-4 from this transaction. If the
delinquent loans cure, and there is no further erosion to credit
enhancement, S&P will affirm the ratings and remove them from
CreditWatch negative. Conversely, if delinquencies cause
substantial realized losses in the coming months, and continue to
erode credit enhancement, S&P will take further negative rating
actions on these classes.
The rating on class L-B-5 was removed from CreditWatch because it
was lowered to 'CCC', and, according to Standard & Poor's
surveillance practices, ratings lower than 'B-' on classes of
certificates or notes from RMBS transactions are not eligible to
be on CreditWatch.
The pools initially consisted of 15-year and 30-year, fixed-rate
and adjustable-rate prime mortgage loans secured by first liens on
owner-occupied one-family to four-family dwellings. The loans
were primarily acquired by Washington Mutual Mortgage Securities
Corp. through its optional termination of trusts in previous
securitizations.
Rating lowered and remaining on creditwatch negative:
Rating
------
Series Class To From
------ ----- -- ----
2005-RA1 L-B-4 B/Watch Neg BB/Watch Neg
Rating lowered and removed from creditwatch negative:
Rating
------
Series Class To From
------ ----- -- ----
2005-RA1 L-B-5 CCC B/Watch Neg
Rating remaining on creditwatch negative:
Series Class Rating
------ ----- ------
2005-RA1 L-B-3 BBB/Watch Neg
Ratings affirmed:
Series Class Rating
------ ----- ------
2005-RA1 1-A, 2-A, 3-A, R AAA
2005-RA1 L-B-1 AA
2005-RA1 L-B-2 A
2005-RA1 3-B-1 AA
2005-RA1 3-B-2 A
2005-RA1 3-B-3 BBB
2005-RA1 3-B-4 BB
2005-RA1 3-B-5 B
* A.M. Best Changes B++ and B+ Rating Descriptor on Insurance Cos.
------------------------------------------------------------------
A.M. Best Company is changing the Financial Strength Rating
Descriptor for B++ and B+ ratings on insurance companies,
effective Jan. 2, 2007.
The reason for the changes is to make the Rating Descriptor
consistent with the existing Rating Definition across all rating
categories.
A Best's Financial Strength Rating (FSR) is an opinion as to an
insurer's financial strength and ability to meet its ongoing
obligations to policyholders.
Old New
Rating Descriptor Descriptor Definition
------ ---------- ---------- ----------
B++, B+ Very Good Good Assigned to companies that
have a good ability to meet
their ongoing obligations to
policyholders.
The change in the Rating Descriptor for insurance companies also
applies to the corresponding Best's Long-Term Issuer Credit Rating
of bbb+, bbb, and bbb-.
The changes to the Rating Descriptor do not represent a change in
A.M. Best's opinion of the relative financial strength of any
insurer or issuer. The B++ and B+ FSRs, and bbb+, bbb, and bbb-
ICRs on insurers, are still considered Secure ratings.
The updated Financial Strength Rating Descriptors on insurance
companies will be reflected in all electronic and print
publications released on or after January 2, 2007.
* Large Companies with Insolvent Balance Sheets
-----------------------------------------------
Total
Shareholders Total Working
Equity Assets Capital
Company Ticker ($MM) ($MM) ($MM)
------- ------ ------------ ------- --------
Acorda Therapeut. ACOR (8) 40 5
AFC Enterprises AFCE (40) 157 4
Affymax Inc AFFY (113) 60 53
Alaska Comm Sys ALSK (25) 566 26
AMR Corp. AMR (514) 30,128 (1,202)
Armstrong World AWI (1,197) 4,721 1,132
Atherogenics Inc. AGIX (136) 197 146
Bare Essentials BARE (619) 139 42
Blount International BLT (107) 441 121
CableVision System CVC (5,400) 9,776 (400)
Carrols Restaurant TAST (104) 497 (25)
Centennial Comm CYCL (1,062) 1,434 33
Charter Comm CHTR (5,632) 15,198 (999)
Choice Hotels CHH (78) 286 (48)
Cincinnati Bell CBB (679) 1,889 55
Claymont Stell H PLTE (30) 176 112
Clorox Co. CLX (55) 3,539 (20)
Compass Minerals CMP (74) 671 145
Corel Corp. CRE (22) 113 11
Crown Media HL CRWN (449) 917 190
Dayton Superior DSUP (171) 282 64
Delphi Corp DPHIQ (7,756) 17,514 2,250
Deluxe Corp DLX (68) 1,296 (188)
Denny's Corporation DENN (231) 454 (73)
Domino's Pizza DPZ (592) 360 (20)
Double-Take Soft DBTK (54) 18 (2)
Echostar Comm DISH (365) 9,351 1,696
Emeritus Corp. ESC (115) 713 (34)
Empire Resorts I NYNY (25) 61 (2)
Encysive Pharm ENCY (88) 69 33
Gencorp Inc. GY (98) 1,017 (3)
Graftech International GTI (157) 875 253
Hansen Medical HNSN (32) 38 33
HealthSouth Corp. HLS (1,339) 3,310 (314)
I2 Technologies ITWO (46) 208 1
ICO Global ICOG (60) 657 (380)
ICOS Corp ICOS (18) 285 112
IMAX Corp IMAX (33) 243 84
Immersion Corp IMMR (22) 47 31
Immunomedics Inc IMMU (21) 50 21
Incyte Corp INCY (66) 465 295
Indevus Pharma IDEV (124) 92 55
Inergy Holdings NRGP (19) 1,647 (12)
Investools Inc. IEDU (63) 120 (79)
IPG Photonics IPGP (31) 115 24
J Crew Group Inc. JCG (55) 414 128
Kaiser Aluminum KALU (3,105) 1,598 123
Koppers Holdings KOP (86) 637 148
Life Sciences Re LSR (25) 205 23
Ligand Pharm LGND (239) 232 (162)
Lodgenet Entertainment LNET (62) 269 18
Maxxam Inc MXM (201) 992 26
McMoran Exploration MMR (38) 438 (46)
Navisite Inc NAVI (4) 100 (9)
New River Pharma NRPH (65) 170 135
Northwest Airlines NWACQ (7,718) 13,498 659
NPS Pharm Inc. NPSP (182) 237 150
Obagi Medical PR OMPI (51) 50 12
Omnova Solutions OMN (2) 366 72
ON Semiconductor ONNN (1) 1,417 316
Portal Software PRSF (20) 112 (14)
Qwest Communication Q (2,576) 21,114 (1,569)
Riviera Holdings RIV (29) 222 10
Rural Cellular RCCC (540) 1,410 165
Rural/Metro Corp. RURL (89) 305 51
Savvis Inc. SVVS (142) 442 16
Sealy Corp. ZZ (188) 933 89
Sepracor Inc. SEPR (33) 1,352 424
St. John Knits Inc. SJKI (52) 213 80
Sun-Times Media SVN (322) 905 (383)
Town Sports Inte. CLUB (25) 417 (55)
Vertrue Inc. VTRU (9) 441 (75)
Weight Watchers WTW (103) 935 (72)
Worldspace Inc. WRSP (1,574) 604 140
WR Grace & Co. GRA (480) 3,641 902
*********
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
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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 2007. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
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re-mailing and photocopying) is strictly prohibited without prior
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herein is obtained from sources believed to be reliable, but is
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*** End of Transmission ***