/raid1/www/Hosts/bankrupt/TCR_Public/080819.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, August 19, 2008, Vol. 12, No. 197
Headlines
388 CRESCENT: Voluntary Chapter 11 Case Summary
ACCENTIA BIOPHARMA: Has Until Feb. 9 to Comply with Bid Price Rule
ACUSPHERE INC: Equity Violation Cues Nasdaq to Delist Securities
AEP INDUSTRIES: S&P Puts B+ Rating on Watch Neg on Atlantis Bid
ALERIS INTERNATIONAL: S&P Puts BB- Term Loan Rating on Watch Neg
ALLIED SECURITY: S&P Raises Bank Loan Rating to 'BB-'
ALVAN MOTOR: Court Okays ARP Services as Financial Consultant
AMR CORP: Amends Purchase Agreement with The Boeing Company
ANSONIA CDO: S&P Downgrades Rating on Class Q Securities to CCC+
AXS-ONE INC: June 30 Balance Sheet Upside-Down by $12.7 Million
BHARAT SHAH: Case Summary & 6 Largest Unsecured Creditors
BOMBAY CO: Prudential Insurance Objects to Terms of Amended Plan
BONTEN MEDIA: Senior Secured Credit Facility Gets 'B+' from S&P
BOSCOV'S INC: Rugs America Balks at Sale of Items Without Consent
BROADLANE INC: S&P Revises Secured Credit Facility Ratings to BB-
BUCKHEAD OIL: Wants to Employ Lamberth Cifelli as Bankr. Counsel
CABLEVISION SYSTEMS: Paying $0.10/Share Dividend on September 18
CALIFORNIA FURNITURE: Case Summary & 80 Largest Unsec. Creditors
CAPITAL LAND: Bankruptcy Case Closes; Compass Forecloses on Assets
CENTAUR LLC: S&P Cuts Rating to 'CCC'; CreditWatch Developing
CINCINNATI BELL: Amends Credit Agreement to Permit $30MM Financing
COMDISCO HOLDING: Will Distribute $1MM to Unsecured Creditors
CRENSHAW PROPERTIES: Case Summary & 2 Largest Unsecured Creditors
CRITICAL THERAPEUTICS: To Submit Nasdaq Rules Compliance Plan
CULINARY ADVENTURES: Case Summary & 20 Largest Unsecured Creditors
CYBERDEFENDER CORP: Has Consulting Agreement with Frontier Capital
DCP LLC: Case Summary & its Largest Unsecured Creditor
DCP LLC: Voluntary Chapter 11 Case Summary
DEBORAH MURRAY: Case Summary & 20 Largest Unsecured Creditors
DIAMOND GLASS: Chapter 11 Plan Filing Period Extended to Nov. 28
DISTRIBUTED ENERGY: Out of NASDAQ, AMEX, NYSE Naked Short List
DUNMORE HOMES: Court Confirms Amended Plan of Liquidation
ELDORADO RESORTS: S&P Withdraws 'B' Ratings at Company's Behest
ESPRE SOLUTIONS: Gets $2MM for Private Placement of Debenture
EXACT SCIENCES: Faces Possible Delisting from Nadaq
FERRO CORP: $150MM Convertible Notes Gets 'B' Rating from S&P
FEY 240: Files Schedules of Assets & Liabilities
FOCUS ENHANCEMENTS: Receives Nasdaq's Bid Price Violation Notice
FORCE PROTECTION: Regulatory Filing Failure Cues Stocks Delisting
FRONTIER AIRLINES: Receives $12.5MM DIP Loan from Republic Airways
FRONTIER AIRLINES: To Delay Filing of Quarter Ended June 30 Report
FRONTIER AIRLINES: Section 341(a) Meeting Moved to September 22
GLEN ROSE: Hein & Associates Expresses Going Concern Doubt
GUARDIAN TECHNOLOGIES: Enters into Consulting Deal with BND
HANOVER CAPITAL: Elects to Defer Interest Payment to WTC
HOME INTERIORS: Wants Court to Approve Employee Incentive Plans
INTERMET CORP: U.S. Trustee to Hold Meeting to Form Panel Today
INTERSTATE BAKERIES: Withdraws Request to Reject CBA with UFCW
INTERSTATE BAKERIES: Wants Court to OK California Properties Sale
IRVINE SENSORS: Board Appoints John Carson as Chairman
IXI MOBILE: Board Starts Strategic Measures to Cut Operating Costs
JDA SOFTWARE: Inks $346 Million Merger Deal with i2 Technologies
JDA SOFTWARE: i2 Technologies Buyout Cues Moody's to Retain B1 CFR
JOHNSTON SHIELD: Wants to Employ Ryan Rapp as Bankruptcy Counsel
LINENS N THINGS: JG Resources Sells LNT'S Fixtures at a Discount
LINENS N THINGS: 2nd Qtr. Sales Down 21%; 10-Q Report Delayed
LINENS N THINGS: Injured Store Invitee Seeks to Sue for Damages
LONDON FOG: Liquidation Brings in $57.9MM to Pay Secured Lenders
MARIPOSA: DJM Realty to Auction 24 Retail Stores
MIDLAND FOOD: Gets Interim OK to Use FBNA et al.'s Cash Collateral
MORTIMER FUNERAL: Case Summary & 20 Largest Unsecured Creditors
MT. CLEMENS: Case Summary & 7 Largest Unsecured Creditors
MTR GAMING: S&P Cuts Rating to 'B-'; Outlook Negative
NANOGEN INC: Posts $5.1 Million Net Loss in Quarter Ended June 30
NASHVILLE SENIOR: Case Summary & 20 Largest Unsecured Creditors
NAUTILUS RMBS: S&P Cuts Ratings on 7 Classes on Plan to Liquidate
NESTOR INC: Edward Heil Resigns as Board Director
NETBANK INC: Seeks Clarification of Disclosure Statement Order
OPTIGENEX INC: Enters into $187,642 Notes Agreement
PERKINS & MARIE: Cut to 'CCC+' by S&P on Likely Covenant Breach
PIERRE FOODS: Wants Perella Weinberg as Investment Banker
PRESTIGE AUTO: Voluntary Chapter 11 Case Summary
PROXYMED INC: Has Until January to Comply with Nasdaq Requirement
QUALITY HOME: Case Trustee, Committee Ask Release of $1.1MM Fund
QUALITY HOME: S&P Raises Corp. Credit Rating to 'B-'; Off Watch
RACERS 2006-18-C: S&P Cuts Rating to 'B' on Long Beach Downgrade
RED SHIELD: U.S. Trustee Forms Five-Member Creditors' Committee
RED SHIELD: May Hire Windsor Associates as Financial Advisor
RED SHIELD: Creditors' Committee Taps Perkins Thompson as Counsel
RED SHIELD: Creditors' Panel Wants Aurora Management as Advisor
RED SHIELD: Preti Wants Chapter 11 Trustees Named for Each Debtor
RICHARD SADALA: Voluntary Chapter 11 Case Summary
RIVIERA HOLDINGS: June 30 Balance Sheet Upside-Down by $43 Million
SABABA GROUP: Voluntary Chapter 11 Case Summary
SAM SELTZERS: U.S. Trustee Appoints Two Members to Creditors Panel
SEMGROUP LP: Bankruptcy Forces BOK to Report Loss
SONICBLUE INC: Trustee et al. Files Amended Disclosure Statement
SPANISH BROADCASTING: S&P Revises 'B-' Rating Outlook to Negative
STEVEN HINDS: Case Summary & 4 Largest Unsecured Creditors
TAITRON COMPONENTS: Has Until Feb. 9 to Comply with Bid Price Rule
TRIPLE CROWN: S&P Cuts 2nd-Lien Term Loan Rating to 'CCC-'
TROPICANA ENT: Court Moves Excl. Plan Filing Period to January 12
TROPICANA ENT: Can Assume or Reject Unexpired Leases Until Dec. 1
US AIRWAYS: Prices Public Offering of 19MM Shares of Common Stock
VERTIS COMMUNICATIONS: June 30 Balance Sheet Upside-Down by $956MM
VERTIS HOLDINGS: Wants Lazard Freres as Financial Advisors
VERTIS HOLDINGS: Taps DLA Piper as Special Corporate Counsel
VERTUE INC: S&P Affirms 'B' Corporate Credit Rating; Outlook Neg
VICORP RESTAURANTS: Has Until Oct. 30 to File Chapter 11 Plan
WALDEN RESERVE: Wants to Borrow $300,000 PostPetition Debt
WALDEN RESERVE: U.S. Trustee Names Eight Creditors to Committee
WALDEN RESERVE: Gets Nod to Employ Evans & Mullinix as Counsel
WALDEN RESERVE: Wants Lattimore Black as Consultant and Accountant
WELLMAN INC: Court Approves Panel's Third Stipulation with Lenders
WESTMORELAND COAL: June 30 Balance Sheet Upside-Down by $192.3MM
WHX CORP: June 30 Balance Sheet Upside-Down by $69.4 Million
WMC MORTGAGE: S&P Affirms 'B' Rating on 2 Classes of Securities
XM SATELLITE: Discloses Risks in Relation to $400MM Offering
ZVUE CORP: Restructures Agreements with Eric's Universe
* S&P Cuts 97 Ratings on US Synthetic CDOs at July Month-End Run
* S&P Takes Rating Actions on Firms in Oil, Gas Service Sectors
* Jones Walker Plans to Combine with Miller Hamilton
* AVIATION WEEK's Study Measures Airlines' Survivability
* Large Companies with Insolvent Balance Sheets
*********
388 CRESCENT: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Debtor: 388 Crescent Property Corp
c/o Spector Feldman LLP
800 Second Avenue
New York, NY 10017-4709
Bankruptcy Case No.: 08-45314
Related Information: Emilio Gorriti filed the petition on the
Debtor's behalf.
Chapter 11 Petition Date: August 14, 2008
Court: Eastern District of New York (Brooklyn)
Judge: Dennis E. Milton
Debtor's Counsel: Jan Riley, Esq.
(cabanillaslaw@hotmail.com)
Cabanillas & Associates PC
149 Grand Street, 3C
White Plains, NY 10601
Tel: (917) 806-1715
Fax: (914) 220-8274
Total Assets: $1,400,000
Total Debts: $955,000
A list of the Debtor's largest unsecured creditors is available
for free at http://bankrupt.com/misc/NYeb08-45314.pdf
ACCENTIA BIOPHARMA: Has Until Feb. 9 to Comply with Bid Price Rule
------------------------------------------------------------------
Accentia Biopharmaceuticals Inc. received notice from Nasdaq that
it is not in compliance with Nasdaq Marketplace Rule 4450(a)(5)
because shares of its common stock had closed at a per share bid
price of less than $1.00 for 30 consecutive business days.
Accentia will be provided with 180 calendar days, or until Feb. 9,
2009, to regain compliance, which would be accomplished when
Accentia's common stock closing bid price is $1.00 per share or
more for a minimum of ten consecutive business days. If the
company does not regain compliance by Feb. 9, 2009, the Nasdaq
staff will notify the company that its common stock will be
delisted. In that event and at that time, the company may appeal
Nasdaq's delisting determination to a Nasdaq Listing
Qualifications Panel. This notification has no effect on the
listing of Accentia's common stock at this time.
Accentia expects to regain compliance within this 180 day cure
period and will consider alternatives to address compliance with
the continued listing standards of The Nasdaq Stock Market.
About Accentia BioPharmaceuticals Inc.
Based in Tampa, Florida, Accentia BioPharmaceuticals Inc. (Nasdaq:
ABPI) -- http://www.accentia.net/-- is a vertically integrated
biopharmaceutical company focused on the development and
commercialization of drug candidates that are in late-stage
clinical development and typically are based on active
pharmaceutical ingredients that have been previously approved by
the FDA for other indications. The company's lead product
candidate is SinuNase(TM), a novel application and formulation of
a known therapeutic to treat chronic rhinosinusitis.
Additionally, the company has acquired the majority ownership
interest in Biovest International Inc. and a royalty interest in
Biovest's lead drug candidate, BiovaxID(TM) and any other biologic
products developed by Biovest. The company also has a specialty
pharmaceutical business, which markets products focused on
respiratory disease and an analytical consulting business that
serves customers in the biopharmaceutical industry.
Accentia Biopharmaceuticals Inc.'s consolidated balance sheet at
March 31, 2008, showed $29.0 million in total assets,
$97.0 million in total liabilities, $4.7 million in
non-controlling interest in variable interest entities, and
$111,963 in convertible redeemable preferred stock, resulting in a
$72.8 million total stockholders' deficit.
Going Concern Doubt
Aidman, Piser & Company, P.A., in Tampa, Florida, expressed
substantial doubt about Accential Biopharmaceuticals Inc.'s
ability to continue as a going concern after auditing the
company's consolidated financial statements for the years ended
Sept. 30, 2007, and 2006. The auditing firm reported that the
company has incurred cumulative net losses of approximately
$164.1 million during the three years ended Sept. 30, 2007,
$57.8 million of which was attributable to their 76% owned
subsidiary, and, as of that date, had a working capital deficiency
of approximately $53.1 million.
The company incurred net losses of $33.1 million, used cash from
operations of approximately $16.1 million during the six months
ended March 31, 2008, and has a working capital deficit of
approximately $67.5 million at March 31, 2008. Net losses for
Biovest, whose results are consolidated with the company, were
approximately $7.8 million, during the same six month period.
ACUSPHERE INC: Equity Violation Cues Nasdaq to Delist Securities
----------------------------------------------------------------
Acusphere Inc. received a letter from NASDAQ indicating that based
on the company's stockholders' equity as reported in its Quarterly
Report on Form 10-Q for the quarter ended June 30, 2008, Acusphere
does not comply with the minimum stockholders' equity requirement
of $10 million for continued listing on The NASDAQ Global Market
as set forth in NASDAQ Marketplace Rule 4450(a)(3). As a result,
the company's common stock will be subject to delisting from The
NASDAQ Global Market unless Acusphere adequately addresses this
deficiency at the company's hearing before the NASDAQ Listing
Qualifications Panel scheduled for the first half of September
2008.
At the hearing, the company will request continued listing on
either The NASDAQ Global Market or The NASDAQ Capital Market based
upon its plan for demonstrating compliance with the applicable
listing requirements. Pursuant to the NASDAQ Marketplace Rules,
the Panel has the authority to grant the company up to an
additional 180 days from the date of NASDAQ's letter regarding the
minimum bid price deficiency, July 14, 2008 (i.e., January 9,
2009), to implement its plan of compliance. There can be no
assurance that the Panel will grant Acusphere's request for
continued listing on NASDAQ. In the event the Panel denies the
company's request for continued listing, Acusphere's common stock
may become eligible for quotation and trading on the OTC Bulletin
Board.
Headquartered in Watertown, Massachusetts, Acusphere Inc. (NASDAQ:
ACUS) -- http://www.acusphere.com-- is a specialty pharmaceutical
company that develops new drugs and improved formulations of
existing drugs using its proprietary microsphere technology. The
company are focused on developing proprietary drugs that can
offer significant benefits such as improved safety and efficacy,
increased patient compliance, greater ease of use, expanded
indications or reduced cost.
Its lead product candidate, Imagify for Injectable Suspension, is
a cardiovascular drug for the detection of coronary artery
disease. Imagify is designed to enable ultrasound to compete more
effectively with nuclear stress testing, the leading procedure for
detecting coronary artery disease.
Going Concern Doubt
Deloitte & Touche LLP in Boston raised substantial doubt about the
ability of Acusphere Inc. to continue as a going concern after it
audited the company's financial statements for the year ended Dec.
31, 2007. The auditor pointed to the company's recurring losses
from operations, negative cash flows from operations, and the
projected funding needed to sustain its operations.
AEP INDUSTRIES: S&P Puts B+ Rating on Watch Neg on Atlantis Bid
---------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings, including
its 'B+' corporate credit rating, on AEP Industries Inc. on
CreditWatch with negative implications. The CreditWatch listing
reflects the uncertainty associated with AEP's recent announcement
that it has entered into an agreement with Atlantis Plastics Inc.
to acquire certain assets related to Atlantis' films business for
a purchase price of $87 million subject to adjustments. AEP plans
to draw down on its revolving credit facility and utilize cash on
hand to fund the acquisition. S&P is concerned that should the
acquisition go through as planned, the resulting increase in debt
will weaken credit metrics and reduce liquidity at a time when the
operating environment is challenging. However, the acquisition is
subject to a bidding process, following Atlantis' recent filing
for Chapter 11 bankruptcy proceedings. The bidding process
anticipates that the sale of the assets will be completed by
October 2008, and could potentially result in AEP not acquiring
the assets.
At April 30, 2008, total adjusted debt (including the present
value of operating leases and unfunded postretirement obligations)
was about $194 million.
AEP's largely debt-financed proposed acquisition has potentially
negative implications for credit measures at a time of a weakening
in the company's operating performance and earnings. Sharply
higher resin prices and increased competitive pressures have
already affected earnings in the second quarter ended April 30,
2008, with adjusted quarterly EBITDA declining significantly to
about $2 million from about $12 million for the previous quarter.
Although management has since undertaken steps to improve
earnings, including increasing product prices, input costs
(primarily plastic resin) continue to rise in the third quarter,
diminishing prospects for a meaningful improvement in earnings to
levels achieved in previous years. Still, credit metrics on a
rolling 12-month basis have thus far remained at levels
appropriate for the rating. At April 30, 2008, the key credit
metric of funds from operations to total debt was slightly above
S&P's expectation of an average of 20% over a cycle. However, if
the potential acquisition results in an increase in debt, and with
continuing weakening in the operating environment, it now appears
increasingly unlikely that the company's credit metrics will be
sustained at April 30, 2008 levels.
ALERIS INTERNATIONAL: S&P Puts BB- Term Loan Rating on Watch Neg
----------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB-' issue rating
on Aleris International Inc.'s $825 million and its €303 million
term loan B both due 2013 on CreditWatch with negative
implications. As of June 30, 2008, total debt outstanding was
about $3 billion, adjusted for operating leases and postretirement
obligations.
The CreditWatch listing reflects the potential for lower recovery
prospects for the company's existing term loan lenders following
the recent announcement by Aleris that it was seeking an increase
to its existing asset-based (ABL) revolving credit facility due
2011 to $1.2 billion from $850 million. S&P currently does not
maintain ratings on the company's ABL credit facility.
"In resolving our CreditWatch listing, we will monitor the status
of the proposed increase and its impact on recovery prospects of
existing term loan lenders," said Standard & Poor's credit analyst
Maurice Austin.
ALLIED SECURITY: S&P Raises Bank Loan Rating to 'BB-'
-----------------------------------------------------
Standard & Poor's Ratings Services raised its issue-level ratings
on Allied Security Holdings LLC's proposed $385 million senior
secured credit facilities and revised the recovery rating on this
debt. S&P raised the issue-level rating to 'BB-' (two notches
higher than the 'B' long-term corporate credit rating on Allied)
from 'B+'. S&P revised the recovery rating to '1', indicating an
expectation for very high (90%-100%) recovery in the event of a
payment default, from '2'.
"The revisions reflect more stringent terms negotiated under the
proposed credit agreement, including higher amortization
requirements, tighter financial covenants, and modifications to
the equity cure provision," said Standard & Poor's credit analyst
Gerald Phelan. The term loan B facility has been increased by $5
million to $330 million to offset the 2% increase in the original
issue discount.
The proposed $385 million senior secured credit facility along
with an unrated senior subordinated mezzanine facility, will
provide a portion of the financing that The Blackstone Group will
use to acquire the company. On completion of the transaction,
Standard & Poor's will withdraw its 'BB-' issue-level rating and
recovery rating of '1' and 'CCC+' issue-level rating and recovery
ratings of '6' on the company's existing $325 million bank
facility and $180 million 11.375% senior subordinated notes,
respectively.
The ratings continue to reflect Allied's narrow business focus,
aggressive growth strategy, competitive operating environment,
highly leveraged financial profile, increased debt levels, and
higher financing costs associated with its pending acquisition by
Blackstone. The company's high customer retention rates,
satisfactory market position, relatively stable cash flows, and
low capital-expenditure requirements partially mitigate these
factors.
Ratings List
Allied Security Holdings LLC
Corporate Credit Rating B/Stable/--
To From
Ratings Raised/Revised
$386 Mil. Sr Sec Credit Fac. BB- B+
Recovery Rating 1 2
ALVAN MOTOR: Court Okays ARP Services as Financial Consultant
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Michigan
gave authority to Alvan Motor Freight Inc. to employ ARP Services,
LLC as its financial consultant.
ARP Services is expected to provide the Debtor cash flow
management services, financial analysis and reporting services,
negotiate with lenders and creditors on security contracts, and
assist in the coordination, protection, and sale of assets.
Anthony Pierfelice, a principal of ARP Services, told the Court
that the firm will provide these services to the Debtor based on
these hourly rates:
Senior Associates $225
Associates $175
Analytical Support Staff $100
Administrative Support Staff $50
Mr. Pierfelice assured the Court that the firm does not represent
any interest adverse to the Debtor.
Based in Kalamazoo, Michigan, Alvan Motor Freight, Inc. and
affiliate VZSG, LLC -- http://www.alvanmotor.com/-- provides
transportation services. The companies filed for Chapter 11
protection on June 29, 2008 (Bankr. E.D. Mich. Case Nos. 08-21909
and 08-21904). Dennis M. Haley, Esq. represents the Debtors in
their restructuring efforts. Samuel D. Sweet, Esq. was appointed
as the Chapter 11 Trustee in the Debtors' cases. When the Debtors
filed for protection from their creditors, they listed total
assets of $22,193,000 and total liabilities of $19,545,000.
AMR CORP: Amends Purchase Agreement with The Boeing Company
-----------------------------------------------------------
American Airlines, Inc., a wholly-owned subsidiary of AMR
Corporation, entered into an amendment to Purchase Agreement
No. 1977 with The Boeing Company on August 8, 2008.
As part of American's fleet renewal plan, American had previously
announced its intentions to take delivery of 70 Boeing 737-800
aircraft over 2009 and 2010; pursuant to the amendment American
has committed to take delivery of 36 737-800 aircraft in 2009 and
40 737-800 aircraft in 2010.
In addition to these aircraft, American has firm commitments for
eleven 737-800 aircraft and seven Boeing 777 aircraft scheduled to
be delivered in 2013-2016.
Prior to this amendment, and as outlined in AMR's second quarter
Form 10-Q filing, American had commitments to purchase 34 Boeing
737-800 aircraft in 2009 and seven Boeing 737-800 aircraft in
2010.
Pursuant to the amendment, American accelerated the scheduled
delivery dates of nine Boeing 737-800 aircraft previously ordered
by American from 2013-2014 to 2010.
In addition, American exercised rights to purchase 20 Boeing
737-800 aircraft for delivery in 2009 and 2010 as part of its
previously communicated fleet plan. Furthermore, American
exercised rights to purchase an additional six 737-800 aircraft
for delivery in 2010.
Payments for American's 737-800 and 777 purchase commitments will
approximate $400 million in the remainder of 2008, $1.1 billion in
2009, $785 million in 2010, $100 million in 2011, $218 million in
2012, and $1.0 billion for 2013 and beyond. These amounts are net
of purchase deposits currently held by the manufacturer.
In conjunction with this transaction, American has arranged for
backstop financing of approximately two-thirds of its 2009 and
2010 Boeing 737-800 deliveries, subject to certain terms and
conditions. American could finance all of its 2009 737-800
deliveries under this arrangement should it elect to do so.
Other than this financing arrangement, American currently has no
committed financing for any aircraft that it is committed to
purchase or that it may order.
Headquartered in Forth Worth, Texas, AMR Corporation (NYSE:
AMR) operates with its principal subsidiary, American Airlines
Inc. -- http://www.aa.com/-- a worldwide scheduled passenger
airline. At the end of 2006, American provided scheduled jet
service to about 150 destinations throughout North America, the
Caribbean, Latin America, including Brazil, Europe and Asia.
American is also a scheduled airfreight carrier, providing
freight and mail services to shippers throughout its system.
Its wholly owned subsidiary, AMR Eagle Holding Corp., owns two
regional airlines, American Eagle Airlines Inc. and Executive
Airlines Inc., and does business as "American Eagle." American
Beacon Advisors Inc., a wholly owned subsidiary of AMR, is
responsible for the investment and oversight of assets of AMR's
U.S. employee benefit plans, as well as AMR's short-term
investments.
* * *
As reported in the Troubled Company Reporter on August 5, 2008,
the TCR said that Moody's Investors Service downgraded the
Corporate Family and Probability of Default Ratings of AMR Corp.
and its subsidiaries to Caa1 from B2, and lowered the ratings of
its outstanding corporate debt instruments and certain equipment
trust certificates and Enhanced Equipment Trust Certificates of
American Airlines Inc. The company still carries Moody's Negative
Outlook.
ANSONIA CDO: S&P Downgrades Rating on Class Q Securities to CCC+
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on 15
classes of notes issued by Ansonia CDO 2007-1 Ltd., a hybrid cash
flow/synthetic collateralized debt obligation (CDO) transaction,
and removed five of them from CreditWatch with negative
implications, where they were placed on May 28, 2008. At the same
time, S&P affirmed its 'AAA' ratings on the class A-1 and A-2
notes.
The downgrades and CreditWatch removals reflect credit
deterioration as well as the incorporation of Standard & Poor's
revised recovery rate assumptions for commercial mortgage-backed
securities.
As of the July 21, 2008, trustee report, approximately 29% of the
underlying collateral (as of Aug. 14, 2008) was rated below
investment grade, compared with approximately 21% as of the first
trustee report issued in August 2007.
Standard & Poor's will continue to monitor the performance of the
transaction to ensure that the ratings continue to reflect the
credit quality of the obligors within the collateral pool and that
the credit enhancement available is sufficient to support the
rated notes.
RATINGS LOWERED AND REMOVED FROM CREDITWATCH NEGATIVE
Ansonia CDO 2007-1 Ltd.
Rating
Class To From
F BBB+ A/Watch Neg
G BBB A-/Watch Neg
H BBB- BBB+/Watch Neg
J BBB- BBB/Watch Neg
K BB+ BBB-/Watch Neg
RATINGS LOWERED
Ansonia CDO 2007-1 Ltd.
Rating
Class To From
B AA AA+
C AA- AA
D A+ AA-
E A A+
L BB BB+
M BB- BB
N B+ BB-
O B B+
P B- B
Q CCC+ B-
RATINGS AFFIRMED
Ansonia CDO 2007-1 Ltd.
Class Rating
A-1 AAA
A-2 AAA
AXS-ONE INC: June 30 Balance Sheet Upside-Down by $12.7 Million
---------------------------------------------------------------
AXS-One Inc. announced its financial results for the second
quarter and six month period ended June 30, 2008.
At June 30, 2008, the company's balance sheet showed total assets
of $3.5 million and total liabilities of $16.3 million, resulting
in a $12.7 million stockholders' deficiency.
Total revenues for the second quarter of 2008 were $3.4 million,
an increase of $0.9 million or 35% from the second quarter 2007
revenues of $2.5 million. License revenue for the second quarter
was $1.1 million, an increase of 109% compared to $0.5 million in
the second quarter of 2007. Service revenue for the second
quarter was $2.3 million, an increase of $0.3 million or 16% from
the second quarter of 2007. Total operating expenses for the
second quarter were $5.5 million, a decrease of 10%, compared to
$6.1 million in the second quarter of 2007. The operating loss
for the second quarter of 2008 was $2.1 million, a $1.4 million or
41% improvement from the second quarter 2007 operating loss of
$3.6 million. The Company reported a net loss of $2.5 million for
the second quarter of 2008, compared to a net loss of $3.7 million
in the second quarter of last year.
Highlights for the second quarter include:
* Announcement of AXS-One as a visionary in the 2008 Gartner
Inc.'s report: "Magic Quadrant for E-Mail Active Archiving."
* Wins and new sales opportunities across disparate industries
including public sector, manufacturing, healthcare and
pharmaceutical. This reflects the position maintained by the
Company that every organization will need software assistance to
manage their electronic records.
* A major competitive replacement an at international medical
device provider, continuing the trend of competitive wins as
organizations reevaluate their archiving technology and vendor
selection.
* Announcement of a patent-pending new product, Dynamic Data
Migrator(TM). The product leverages the company's current
archiving and electronic records management technology to provide
a unique approach for organizations migrating their messaging
platform from Lotus Notes to Microsoft Exchange.
* Endorsement from Microsoft of Dynamic Data Migrator and
expansion of AXS-One’s current partnership with the company.
Microsoft has identified their "Notes Transition Program" as a
strategic initiative for the current fiscal year and, per their
quote in the product announcement, is excited by the product's
ability to "have a dramatic effect on the cost and time it takes
customer to migrate."
"We are seeing steady progress in our core business of electronic
records archiving and are particularly excited about the
opportunity presented by Microsoft to migrate millions of users
that have already committed to convert from Notes to Exchange,
using our software products and methodology," Bill Lyons, Chairman
& CEO of AXS-One, commented. "We are actively engaged with the
Microsoft team, which has validated and endorsed our technology
and methodology and are now introducing us into their client
opportunities. We expect this partnership to drive a significant
improvement in our financial results starting this year."
For the first six months of 2008, total revenues were
$7.3 million, an increase of 17.4% compared with total revenues of
$6.2 million for the first six months of 2007. License fees were
$2.5 million, up 10.5% from the $2.3 million in license fees for
the first six months last year. Total operating expenses were
$11.2 million for the first six months of 2008, a decrease of
11.3% from $12.6 million in the prior year. The operating loss
narrowed to $3.9 million for the first six months of 2008, down
from an operating loss of $6.4 million in the first six months of
last year. The net loss for the first six months of 2008 was
$4.7 million, compared to a net loss of $6.3 million for the
comparable prior-year period.
"Corporate leaders continue to recognize the importance of
implementing electronic records management solutions as a key risk
management tool," Mr. Lyons continued. "The changes in the
processes for litigation, including the new Federal Rules of Civil
Procedure, remain a catalyst for us as enterprises recognize the
need to pro-actively manage their electronically stored
information. This trend demonstrates that industry leaders
recognize the growing trend in this area, and increasingly see
AXS-One as an emerging leader. As a pioneer in providing
archiving and electronic records management for disparate record
types for 15 years, AXS-One is uniquely positioned to exploit this
emerging and accelerating opportunity."
About AXS-One Inc.
Headquartered in Rutherford, N.J., AXS-One (OTC BB: AXSO)
-- http://www.axsone.com/-- provides Records Compliance
Management software solutions. The AXS-One Compliance Platform
enables organizations to implement secure, scalable and
enforceable policies that address records management for corporate
governance, legal discovery and industry regulations such as
SEC17a-4, NASD 3010, Sarbanes-Oxley, HIPAA, The Patriot Act and
Gramm-Leach Bliley. AXS-One has offices worldwide including in
the United States, Australia, Singapore, United Kingdom and South
Africa.
Going Concern Doubt
As reported in the Troubled Company Reporter on April 25, 2008,
Amper, Politziner, & Mattia, P.C., in Edison, N.J., expressed
substantial doubt about AXS-One Inc.'s ability to continue as a
going concern after auditing the company's consolidated financial
statements for the years ended Dec. 31, 2007, and 2006. The
auditing firm pointed to the company's losses from operations and
working capital deficiency.
The company has generated losses from operations of $1,752,000 for
the three months ended March 31, 2008. Additionally, the company
was not in compliance with its quarterly license revenue covenant
as of March 31, 2008. The bank waived such violation and changed
the covenants for future periods from a minimum license revenue
covenant and minimum three month rolling net loss covenant to (a)
a minimum three month rolling EBITDA covenant, (b) minimum cash
and accounts receivable availability covenant and (c) a minimum
equity infusion covenant of $500,000.
BHARAT SHAH: Case Summary & 6 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Bharat T. Shah
55 Beverly Drive
Middletown, NY 10941
Bankruptcy Case No.: 08-36772
Chapter 11 Petition Date: August 14, 2008
Court: Southern District of New York (Poughkeepsie)
Debtors' Counsel: Andrea B. Malin, Esq.
Genova & Malin
1136 Route 9
Wappingers Falls, NY 12590
Tel: (845) 298-1600
Fax: (845) 298-1265
Email: genmallaw@optonline.net
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
A copy of Bharat T. Shah's is available for free at:
http://bankrupt.com/misc/nysb08-36772.pdf
BOMBAY CO: Prudential Insurance Objects to Terms of Amended Plan
----------------------------------------------------------------
Prudential Insurance Company of America and other landlord
creditors object to the terms of the first amended joint Chapter
11 plan of liquidation dated July 2, 2008, of Bombay Company Inc.
and its debtor-affiliates.
The other landlord creditors are Madison Bay Street, 770 Tamalpis
Drive, Counsins Properties Incorporated, Macerich Company,
Westfield, RREEF Management Company.
Prudential Insurance et al. leased 47 nonresidential real property
to the Debtors as retail sales space in shopping centers in the
United States. They say all of the leases have been either
rejected by the Debtors or terminated under lease termination
agreements.
Prudential Insurance et al. argue that the Debtors' plan deprived
them from asserting set-offs rights before the plan's effective
date. They contend that the Debtors' plan should be revised to
eliminate such provisions.
Several creditors, including Riverside County and San Bernardino
County in California, Maria Cantelmi and Diane Parry, also object
to the Debtors' amended plan.
As reported in the Troubled Company Reporter on July 9, 2008, the
Hon. D. Michael Lynn of the United States Bankruptcy Court for the
Northern District of Texas approved the Debtors' amended
disclosure statement explaining an amended liquidation plan.
A hearing was set for Aug. 20, 2008, at 1:30 p.m., to consider
confirmation of the Debtors' amended plan.
Under the Plan, Elaine D. Crowley, the appointed liquidation
trustee, will issue a share of common stock for The Bombay Company
Inc. and become the sole shareholders, officer and director of The
Bombay Company Inc. replacing its existing shareholders and
company officers. All other shares of any class of stock of each
of the Debtors will be canceled on the Plan's effective date.
A liquidation trust will be created for the benefit of all
creditors of the estates holding allowed claims.
According to the Plan, the Debtors are expected to transfer any
of their assets including:
-- cash and accounts,
-- litigation causes of action,
-- ownership interest in Bombay Brands LLC, and
-- all other property interests, rights, claims, defenses and
causes of action with respect to any and all non-debtor
intercompany claims or the Debtors.
On the plan's effective date, holders of Class 3 General Unsecured
Creditors are expected to receive between 16.4% and 28.9% of the
allowed amount of their claims, plus their pro rata shares of any
value realized from the litigation causes of action. The earlier
plan version provides a recovery to Class 3 holders between 18.5%
and 31.5% of the allowed amount of their claims.
A full-text copy of the Debtors' Amended Joint Chapter 11 Plan of
Reorganization is available for free at:
http://ResearchArchives.com/t/s?2f38
Based in Fort Worth, Texas, The Bombay Company Inc., (OTC
Bulletin Board: BBAO) -- http://www.bombaycompany.com/-- designs,
sources and markets a unique line of home accessories, wall decor
and furniture through 384 retail outlets and the Internet in the
U.S. and internationally, including Cayman Islands.
The Bombay Furniture Company of Canada Inc. - La Compagnie de
Mobilier Bombay Du Canada Inc. -- sought protection from its
creditors from the Ontario Superior Court of Justice on Sept. 20,
2007.
The company and five of its debtor-affiliates filed for Chapter 11
protection on Sept. 20, 2007 (Bankr. N.D. Tex. Lead Case No.
07-44084). Robert D. Albergotti, Esq., John D. Penn, Esq., Ian T.
Peck, Esq., and Jason B. Binford, Esq., at Haynes and Boone, LLP,
represent the Debtors. The U.S. Trustee for Region 6 appointed
seven creditors to serve on an Official Committee of Unsecured
Creditors. Attorneys at Cooley, Godward, Kronish LLP act as
counsel to the Unsecured Creditors Committee. As of May 5, 2007,
the Debtors listed total assets of $239,400,000 and total debts of
$173,400,000.
* * *
The Debtors' consolidated monthly operating report for April 30,
2008, showed total assets of $34,100,177 and total liabilities of
$31,780,942.
BONTEN MEDIA: Senior Secured Credit Facility Gets 'B+' from S&P
---------------------------------------------------------------
Standard & Poor's Ratings Services revised its rating outlook on
New York City-based Bonten Media Group Inc. to stable from
negative. All existing ratings on the company, including the 'B'
corporate credit rating, were affirmed.
In addition, S&P assigned ratings to Bonten Media's proposed
senior secured credit facility. The facility was rated 'B+' (one
notch higher than the 'B' corporate credit rating on the company)
with a recovery rating of '2', indicating S&P's expectation of
substantial (70% to 90%) recovery in the event of a payment
default. (For the complete recovery analysis, see Standard &
Poor's recovery report on Bonten Media, to be published on
RatingsDirect immediately following the release of this report.)
The proposed facility will partially finance the $209 million
acquisition of NewsChannel 5 Network LLC, which owns the
Nashville, Tenn. CBS affiliate.
"The outlook revision is based on the business portfolio benefits
of Bonten Media's pending acquisition of NewsChannel 5 and the
sponsor's additional equity investment, which slightly alleviates
leverage," said Standard & Poor's credit analyst Deborah Kinzer.
The 'B' rating reflects the TV broadcaster's high debt leverage,
still relatively narrow revenue and cash flow diversification,
weak conversion of EBITDA into discretionary cash flow because of
high interest expense, and TV broadcasting's mature revenue growth
prospects. The good positions of Bonten Media's predominantly
major network-affiliated TV stations in Nashville and several
small and midsize markets, broadcasting's good margins and
discretionary cash flow potential, and largely resilient TV
station asset values only partially offset these factors.
BOSCOV'S INC: Rugs America Balks at Sale of Items Without Consent
-----------------------------------------------------------------
Rugs America Corp. objects to the entry of any order permitting
Boscov's Inc. and its affiliated debtors to sell certain
merchandise owned by Rugs America without prior consent from Rugs
America and in any manner inconsistent with the Department License
Agreement entered into between the parties.
Rugs America tells the U.S. Bankruptcy Court for the District of
Delaware that it has filed a Uniform Commercial Code financing
statement to evidence its continued interest in its merchandise.
Rugs America also objects to the DIP Motion to the extent, if
any, that the Motion seeks authorization to grant liens on the
Merchandise. The Merchandise, Rugs America asserts, is not part
of the Debtors' inventory but remains Rugs' property until the
point of the Merchandise' sale.
Headquartered in Reading, Pennsylvania, Boscov's Inc. --
http://www.boscovs.com-- is America's largest family-owned
independent department store, with 49 stores in Pennsylvania, New
York, New Jersey, Maryland, Delaware and Virginia.
Boscov's Inc. and its debtor-affiliates filed for Chapter 11
protection on Aug. 4, 2008 (Bankr. D. Del. Case No.: 08-11637)
Daniel J. DeFranceschi, Esq. at Richards Layton & Finger and L.
Katherine Good, Esq. at Richards, Layton & Finger, P.A. represent
the Debtors in their restructuring efforts. The Debtors'
financial advisor is Capstone Advisory Group and their investment
banker is Lehman Brothers Inc. The Debtors disclosed estimated
assets of $500 million to $1 billion and estimated debts of
$100 million to $500 million.
(Boscov's Bankruptcy News, Issue No. 4; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)
BROADLANE INC: S&P Revises Secured Credit Facility Ratings to BB-
-----------------------------------------------------------------
Standard & Poor's Ratings Services revised its issue-level and
recovery ratings on Broadlane Inc.'s senior secured credit
facilities following a change in the deal terms. The facilities
now consist of a $15 million revolving credit facility and a $140
million term loan B, both due in 2013. The term loan was increased
by $5 million. The rating on this secured debt was lowered to
'BB-' (one notch above the 'B+' corporate credit rating on the
company) from 'BB'. The recovery rating was revised to '2',
indicating S&P's expectation for substantial (70%-90%) recovery
for secured lenders in the event of a payment default.
The company also decreased the amount of its senior subordinated
notes issuance (unrated) by $5 million, to $62.5 million.
The corporate credit rating on Broadlane is 'B+' and the rating
outlook is stable. The 'B+' rating reflects the company's
uncertain level of success operating as a newly independent entity
in the competitive group purchasing organization (GPO) industry,
the concentration within its relatively limited revenue base, and
its high financial leverage. These risks are partially offset by
the company's unique service offering, the recurring nature of its
revenues, and its strong cash flow generation.
Ratings List
Broadlane Inc.
Corporate credit rating B+/Stable/--
To From
Revised Ratings
Secured debt BB- BB
Recovery rating 2 1
BUCKHEAD OIL: Wants to Employ Lamberth Cifelli as Bankr. Counsel
----------------------------------------------------------------
Buckhead Oil Company, Inc. asks permission from the U.S.
Bankruptcy Court for the Northern District of Georgia to employ
Lamberth, Cifelli, Stokes, Ellis & Nason, P.A. as its bankruptcy
counsel.
Lamberth Cifelli, will, among others, advise, assist, and
represent the Debtor with respect to the Debtor's rights, powers,
duties, and obligations in the administration of this case, and
the collection, preservation, and administration of assets of the
Debtor's estate.
Gregory D. Ellis, Esq., a member of Lamberth Cifelli, tells the
Court that he will bill the Debtor an hourly rate of $375 for his
services.
Mr. Ellis assures the Court that the firm does not represent any
interest adverse to the Debtor.
Mcdonough, Georgia-based Buckhead Oil Company, Inc. filed for
Chapter 11 protection on July 3, 2008 (Bankr. N.D. Ga. Case No.
08-72829). Gregory D. Ellis, Esq. represents the Debtor in its
restructuring efforts. When the Debtor filed for protection from
its creditors, it listed estimated assets and debts of
$1 million to $100 million.
CABLEVISION SYSTEMS: Paying $0.10/Share Dividend on September 18
----------------------------------------------------------------
Cablevision Systems Corporation disclosed that, at a regularly
scheduled board meeting, its board of directors declared a
quarterly dividend of $0.10 per share on each outstanding share of
both its NY Group Class A Stock and its NY Group Class B Stock.
This quarterly dividend will be payable on Sept. 18, 2008, to
shareholders of record at the close of business on Aug. 26, 2008.
The declaration of a quarterly dividend, The Wall Street Journal
related, came a day after hedge fund Harbinger Capital Management
reported in a filing that it had acquired a 4.9% stake in
Cablevision. Investors suspect that Cablevision's more
conciliatory tone in recent weeks -- including its first
shareholder meeting in years -- may be an effort to keep Harbinger
at bay," WSJ pointed out. Harbinger made a government filing
about three weeks ago that alerted Cablevision management about
its holdings, WSJ said according to a person familiar with the
situation.
The company stated that the dividend payment was related to the
management's move to explore potential strategies for bringing the
market value of Cablevision's common stock more closely in line
with the underlying operating performance of the company. James
L. Dolan, Cablevision president and chief executive said that
these strategies include dividends, stock buybacks, the spin-off
of one or more businesses and other potential strategies.
"Our strong performance and cash flow enable us to return value to
shareholders through dividends," Mr. Dolan added. "This action is
a part of the process we have undertaken to enhance shareholder
value as we continue to explore other options that we believe will
help align the market value of the company's common stock with
Cablevision's underlying operating performance."
The dividend by Cablevision will be paid from the proceeds of a
dividend to Cablevision from its wholly owned subsidiary, CSC
Holdings Inc. The CSC Holdings distribution will be funded from
cash on hand.
WSJ, citing an investor, Cablevision's move revealed a totally
different management team than investors have seen in the past.
Cablevision stock, WSJ indicated, initially slipped on news of the
dividend, but was up 81 cents at $32.12, as of 4 p.m. composite
trading on the New York Stock Exchange on August 15.
About Cablevision Systems Corp.
Headquartered in Bethpage, New York, Cablevision Systems Corp.
(NYSE: CVC) -- is a cable operator in the United States that
operates cable programming networks, entertainment businesses and
telecommunications companies. Through its wholly owned
subsidiary, Rainbow Media Holdings LLC, Cablevision owns interests
in and manages numerous national and regional programming
networks, the Madison Square Garden sports and entertainment
businesses, and cable television advertising sales companies.
Through Cablevision Lightpath Inc., its wholly owned subsidiary,
the company provides telephone services and Internet access to the
business market.
At March 31, 2008, the company's consolidated balance sheet showed
$9.2 billion in total assets and $14.3 million in total
liabilities, resulting in a $5.1 billion total stockholders'
deficit.
* * *
As disclosed in the Troubled Company Reporter on June 6, 2008,
Standard & Poor's Ratings Services affirmed all its ratings,
including its 'BB' corporate credit rating, on based Cablevision
Systems Corp., a major cable operator in the New York City
metropolitan area, and its subsidiaries. The outlook is negative.
Cablevision had about $11.6 billion of reported consolidated debt
outstanding on March 31, 2008.
On June 2, 2008, TCR said that Moody's Investors Service assigned
a B1 rating to the proposed new $500 million of senior unsecured
debt to be issued by Cablevision Systems Corporation's subsidiary
CSC Holdings, Inc. Existing ratings for the company and CSC were
also affirmed. The rating outlook remains stable.
CALIFORNIA FURNITURE: Case Summary & 80 Largest Unsec. Creditors
----------------------------------------------------------------
Lead Debtor: California Furniture Solutions, Inc.
25125 Madison Ave. Ste. 106
Murrieta, CA 92562
Bankruptcy Case No.: 08-20407
Debtor-affiliates filing separate Chapter 11 petitions:
Entity Case No.
------ --------
Rohnert Park Furniture Solutions, Inc. 08-20408
Empty Heads, Inc. 08-20409
Fairfield Furniture Solutions, Inc. 08-20411
Type of Business: The Debtors sell furniture.
Chapter 11 Petition Date: August 14, 2008
Court: Central District Of California (Riverside)
Judge: Meredith A. Jury
Debtors' Counsel: Robert B. Rosenstein, Esq.
Email: robert@rosenhitz.com
Rosenstein & Hitzeman
28600 Mercedes St. Ste. 100
Temecula, CA 92590
Tel: (951) 296-3888
Fax: (951) 296-3889
http://www.rosenhitz.com/
California Furniture Solutions, Inc's Financial Condition:
Estimated Assets: $100,000 to $500,000
Estimated Debts: $1,000,000 to $10,000,000
A. A copy of California Furniture Solutions, Inc's petition is
available for free at:
http://bankrupt.com/misc/cacb08-20407.pdf
B. A copy of Rohnert Park Furniture Solutions, Inc's petition is
available for free at:
http://bankrupt.com/misc/cacb08-20408.pdf
C. A copy of Empty Heads, Inc's petition is available for free at:
http://bankrupt.com/misc/cacb08-20409.pdf
D. A copy of Fairfield Furniture Solutions, Inc's petition is
available for free at:
http://bankrupt.com/misc/cacb08-20411.pdf
CAPITAL LAND: Bankruptcy Case Closes; Compass Forecloses on Assets
------------------------------------------------------------------
The United States Bankruptcy Court for the District of Nevada, at
the behest of Lisa M. Poulin, chapter 11 trustee, dismissed the
bankruptcy case of Capital Land Investors LLC, but expressly
reserved jurisdiction to determine fees.
The Court allowed the immediate payment of $20,000 in fees to
Gordon & Silver, Ltd., as counsel to the case trustee. Gordon &
Silver was awarded $37,452 for fees, including $20,000 payment,
and $3,120 for expenses.
The Debtor's remaining assets were its property and the less than
$350 it held in checking account. The bankruptcy case was
commenced because several potential purchasers had expressed
interest in the Debtor's property and had made preliminary verbal
offers that exceeded the principal debt owed to Compass FP Corp.
However, due to the plummeting real estate market, the case
trustee was unable to timely locate a buyer willing and able to
enter into a purchase agreement providing for the sale of the
property for a sum in excess of the principal debt owed on the
Compass loan. The case trustee was unable to either propose a
plan of reorganization with a reasonable likelihood of success or
to commence the payments.
On March 4, 2008, the Court granted Compass relief from the
automatic stay to commence foreclosure on the Debtor's property.
Compass subsequently foreclosed on the property leaving
essentially no assets to administer. Hence, good cause exist
pursuant to Section 1112(b) of the U.S. Bankruptcy Code to dismiss
the Debtor's bankruptcy case.
About Capital Land
Las Vegas, Nevada-based Capital Land Investors LLC owns and
manages real estate. It is a single asset real company whose
primary assets is located in Perris, California, a 695-acre
unimproved land intended for development into a residential
community. The property is presently in the late stages of the
entitlement phase.
Under an operating agreement, Capital Land's members are USA
Investment Partners LLC (holds 25% membership); Jabral Investments
LLC (25%); The Richard Craig Ashby Irrevocable Trust UTD July 27,
1998 (6.25%); The Bradly Ashby Irrevocable Trust UTD July 27, 1998
(6.25%); and The Justin Ashby Irrevocable Trust UTD July 27, 1998
(6.25%).
On April 4, 2007, USA Capital Diversified First Trust Deed Fund
LLC, USACM Liquidating Trust, and Alabruj Investments LLC filed
involuntary petition for relief under chapter 11 against USAIP,
Capital Land's affiliate. Lisa M. Poulin, in her capacity as
chapter 11 case trustee of USAIP, with the consent of Capital
Land's remaining members, caused Capital Land to file voluntary
bankruptcy petition.
The Debtor filed for chapter 11 protection on Dec. 4, 2007 (Bankr.
D. Nev. Case No. 07-18099). Lisa M. Poulin is the proposed
chapter 11 trustee for Capital Land. Talitha B. Gray, Esq., at
Gordon & Silver Ltd., represented the Debtor in its restructuring
efforts and is also the proposed counsel for the case trustee.
Peter C. Bernhard, Esq., and Georganne W. Bradley, Esq., at
Bullivant Houser Bailey PC, served as the Debtor's local counsels.
The Debtor's schedules showed total assets of $30,000,321 and
total liabilities of $63,522,426.
On Jan. 24, 2008, the Court appointed Lisa M. Poulin as chapter 11
trustee for the Debtor. Gordon & Silver Ltd. represented the case
trustee. CB Richard Ellis Inc. was named property broker in the
disposition of the Debtor's assets. The Debtor's bankruptcy case
was closed on Aug. 7, 2008.
CENTAUR LLC: S&P Cuts Rating to 'CCC'; CreditWatch Developing
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
and issue-level ratings on Centaur LLC. The corporate credit
rating was lowered to 'CCC' from 'B'. The ratings remain on
CreditWatch; however, the implications were revised to developing
from negative.
"The downgrade reflects a Notice of Event of Default and
Acceleration issued to Centaur yesterday by its second-lien
lenders, due to the company's inability to obtain its Pennsylvania
gaming license as stipulated in the credit facility. There is
currently a 120-day standstill period until the second-lien
lenders can accelerate payment, during which time we expect
negotiations between first- and second-lien lenders to occur.
While we do not believe acceleration of payment is the likely
outcome, a high level of uncertainty exists as to what actions
both the first- and second-lien lenders will take," S&P says.
"If lenders reach some sort of resolution and decide not to
accelerate, we could potentially raise our rating on Centaur,"
said Standard & Poor's credit analyst Ariel Silverberg. "However,
the extent of an upgrade would be contingent upon an assessment of
the operating performance of the company's facilities in Colorado
and Indiana within the context of the revised capital structure."
"In resolving the CreditWatch listing, we will monitor discussions
between the lenders and evaluate the implications of any
resolution," S&P says.
CINCINNATI BELL: Amends Credit Agreement to Permit $30MM Financing
------------------------------------------------------------------
Cincinnati Bell Inc. amended its Credit Agreement originally dated
as of Feb. 16, 2005 among the company, as Borrower, certain of its
subsidiaries as Guarantors, the Lenders party, Bank of America,
N.A., as Administrative Agent and an L/C Issuer, and PNC Bank,
National Association, as Swingline Lender and an L/C Issuer,
pursuant to a Third Amendment to Credit Agreement dated as of
August 12, 2008 among the company, the Guarantors signatories, the
Lenders party, Bank of America, N.A., Administrative Agent and
Lender, and PNC Bank, National Association, as Swingline Lender
and Lender.
The Third Amendment amends various provisions within the Credit
Agreement so that the company may engage in up to $75 million in
sale-leaseback transactions with the company's data center
facilities.
The Third Amendment also amends various provisions to permit a
revolving equipment and inventory financing facility up to
$30 million, with a corresponding decrease in the Credit
Agreement's permitted purchase money indebtedness basket from
$100 million to $70 million.
A detail of the company's Third Amendment Plan is available at:
http://ResearchArchives.com/t/s?30d5
About Cincinnati Bell
Headquartered in Cincinnati, Ohio, Cincinnati Bell Inc. (NYSE:
CBB) -- http://www.cincinnatibell.com/-- provides integrated
communications solutions-including local, long distance, data,
Internet, and wireless services.
In addition, the company provides office communications systems as
well as complex information technology solutions including data
center and managed services.
Cincinnati Bell conducts its operations through three business
segments: Wireline, Wireless, and Technology Solutions.
* * *
As reported in the Troubled Company Reporter dated August 12,
2008, Fitch Ratings affirmed the company's 'B+' Issuer Default
Rating.
COMDISCO HOLDING: Will Distribute $1MM to Unsecured Creditors
-------------------------------------------------------------
Comdisco Holding Company Inc. disclosed that in accordance with
its plan of reorganization, it would make a supplemental
distribution in the approximate amount of $1 million, including
interest and dividends earned on the funds and the shares in the
Disputed Claims Reserve, to its general unsecured creditors with
allowed claims. This distribution will be the final distribution
from the Disputed Claims Reserve as all Disputed Claims have been
resolved and the Disputed Claims Reserve is no longer required by
Comdisco's plan of reorganization.
Comdisco Holding Company Inc. (OTC BB: CDCO) is formerly known as
Comdisco Inc. It emerged from chapter 11 bankruptcy proceedings
on Aug. 12, 2002. The purpose of reorganized Comdisco is to sell,
collect or otherwise reduce to money in an orderly manner the
remaining assets of the corporation.
The company filed on Aug. 12, 2004, a Certificate of Dissolution
with the Secretary of State of the State of Delaware to formally
extinguish Comdisco Holding Company Inc.'s corporate existence
with the State of Delaware except for the purpose of completing
the wind-down contemplated by the Plan. Pursuant to its plan of
reorganization and restrictions contained in its certificate of
incorporation, Comdisco is specifically prohibited from engaging
in any business activities inconsistent with its limited business
purpose.
CRENSHAW PROPERTIES: Case Summary & 2 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Crenshaw Properties LLC
15036 Oxnard Street
Van Nuys, CA 91411
Bankruptcy Case No.: 08-15905
Chapter 11 Petition Date: August 13, 2008
Court: Central District Of California (San Fernando Valley)
Judge: Hon. Geraldine Mund
Debtor's Counsel: David I Brownstein
(db@brownsteinllp.com)
Brownstein & Brownstein LLP
21700 Oxnard St Ste 1160
Woodland, CA 91367
Telephone (818) 905-0000
Fax (818) 593-3988
Estimated Assets: $1,000,001 to $10 million
Estimated Debts: $1,000,001 to $10 million
A copy of the debtor's petition and list of its 2 largest
unsecured creditors is available for free at:
http://bankrupt.com/misc/cacb08-15905
CRITICAL THERAPEUTICS: To Submit Nasdaq Rules Compliance Plan
-------------------------------------------------------------
Critical Therapeutics Inc. received a letter from the NASDAQ Stock
Market's Listing Qualification Department notifying the company
that, based on its stockholders' equity of $1.2 million, as
reported in the company's Quarterly Report on Form 10-Q for the
quarter ended June 30, 2008, and a market value of its common
stock as of Aug. 12, 2008, of $13.0 million, the company does not
comply with NASDAQ Marketplace Rule 4310(c)(3), which requires the
company to have, for continued listing on The NASDAQ Capital
Market, a minimum of $2.5 million in stockholders' equity or
market value of listed securities of $35.0 million or $500,000 of
net income from continuing operations for the most recently
completed fiscal year or for two of the three most recently
completed fiscal years. As a result, the Listing Qualifications
Staff is reviewing the company's eligibility for continued listing
on The NASDAQ Capital Market.
To facilitate the review, the company expects to provide to the
Listing Qualifications Staff on or before Sept. 4, 2008, a
definitive plan, based on completing the proposed merger with
Cornerstone BioPharma Holdings Inc., to achieve and sustain
compliance with all NASDAQ Capital Market listing requirements.
If, after the conclusion of its review process, the Listing
Qualifications Staff determines that Critical Therapeutics' plan
does not adequately address the deficiencies noted, the Staff will
provide written notice to Critical Therapeutics that its common
stock will be delisted from The NASDAQ Capital Market. In the
event, Critical Therapeutics may appeal the Staff's decision to a
NASDAQ Listing Qualifications Panel.
About Critical Therapeutics
Based in Lexington, Massachussetts, Critical Therapeutics Inc.
(Nasdaq: CRTX) -- http://www.crtx.com/-- is developing and
commercializing innovative products for respiratory and
inflammatory diseases. Critical Therapeutics owns worldwide
rights to two FDA-approved drugs: ZYFLO CR(TM)(zileuton) extended-
release tablets and ZYFLO(R)(zileuton tablets).
Going Concern Doubt
As reported in the Troubled company Reporter on April 18, 2008,
Deloitte & Touche LLP, in Boston, expressed substantial doubt
about the Critical Therapeutics Inc.'s ability to continue as a
going concern after auditing the company's consolidated financial
statements for the years ended Dec. 31, 2007, and 2006. The
auditing firm pointed to the company's recurring losses from
operations, recurring negative cash flows from operations and an
accumulated deficit of $191,372,000 as of Dec. 31, 2007.
As of March 31, 2008, the company had an accumulated deficit of
approximately $202,151,000.
CULINARY ADVENTURES: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------------
Debtor: Culinary Adventures, Inc.
567 San Nicolas Drive
Suite 400
Newport Beach, CA 92660
Bankruptcy Case No.: 08-14877
Type of Business: The Debtor operates a restaurant.
See http://www.culinaryadventures.com/
Chapter 11 Petition Date: August 14, 2008
Court: Central District Of California (Santa Ana)
Judge: Erithe A. Smith
Debtor's Counsel: Leonard M. Shulman, Esq.
(lshulman@shbllp.com)
Shulman Hodges & Bastian LLP
26632 Town Center Drive, Suite 300
Foothill Ranch, CA 92610
Tel: (949) 340-3400
Fax: (949) 340-3000
Estimated Assets: $1,000,000 to $10,000,000
Estimated Debts: $1,000,000 to $10,000,000
Debtor's list of its 20 largest unsecured creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Scott Mosely and Joint Stipulation $212,250
Mark Prevot et al. Settlement and
Elana R. Levine, Esq. Release
Kingsley & Kingsley APC
16133 Ventura Boulevard
Suite 1200
Encino, CA 91436
Youngs Market Company Trade Creditor $141,438
P.O. Box 30145
Los Angeles, CA 90030-0145
American Fish & Seafood Co. Trade Creditor $134,334
File #1067
1801 West Olympic Boulevard
Pasadena, CA 91199-1067
Sysco Food Services Trade Creditor $125,747
Goldberg & Solovy Foods Inc. Trade Creditor $106,396
Century City Mall LLC Lease $94,829
California Produce Trade Creditor $93,878
Southern Wine & Spirits Trade Creditor $80,804
Spectra Asset Management Inc. Lease $79,180
RW Smith & Company Trade Creditor $79,146
Morrissey Construction Co. Construction Services $75,000
DB Real Estate Lease $67,683
The Pinnacle L.P.
LA Specialty Produce Trade Creditor $66,308
CRMBC Trade Creditor $65,082
Chef's Warehouse Trade Creditor $58,629
Maguire Properties Inc. Lease $57,274
Pier Plaza Group LLC Lease $41,895
The Irvine Company LLC Lease $35,299
White Apron Inc. Trade Creditor $33,244
Yee Yuen Linen Service Trade Creditor $32,736
CYBERDEFENDER CORP: Has Consulting Agreement with Frontier Capital
------------------------------------------------------------------
Cyberdefender Corporation, on July 15, 2008, entered into a
Consulting Agreement with Frontier Capital Partners L.L.C.
Frontier has agreed to provide investor relations and other
business advisory services to the company. The Agreement has a
term of 3 months, but may be terminated by either party upon 5
days written notice. The Agreement also includes provisions
allowing immediate termination in the event of dissolution,
bankruptcy or insolvency and for cause.
The company has agreed to issue to Frontier 125,000 shares of
restricted common stock as compensation for these services. The
75,000 shares are to be issued immediately (upon execution of the
Agreement) and are deemed to be a non-refundable retainer. The
remaining 50,000 shares are to be issued 46 days after execution
of the Agreement. The company also agreed to indemnify Frontier
against liability it may incur relating to any act or failure to
act or misrepresentation made by the company in relation to the
Agreement.
As reported by the Troubled Company Reporter on June 25, 2008,
Cyberdefender's balance sheet at March 31, 2008, showed
$1,382,775 in total assets and $4,842,307 in total liabilities,
resulting in a $3,459,532 total stockholders' deficit.
Going Concern Doubt
KMJ Corbin & Company LLP, in Irvine, California, expressed
substantial doubt about Cyberdefender Corp.'s ability to continue
as a going concern after auditing the company's financial
statemetns for the year ended Dec. 31, 2007. The auditing firm
reported that the Company has recurring losses from operations
and has not generated significant revenues to cover costs to date.
About CyberDefender Corp.
Headquartered in Los Angeles, CyberDefender Corp. (OTC BB: CYDE) -
-- http://www.cyberdefender.com/-- is an Internet security
software company. The company's Internet security technology
offers the earliest possible detection and most aggressive defense
against Internet security attacks. CyberDefender uses a secure
client-to-client distributed network, enabling protection that the
company believes is unparalleled in speed and flexibility.
DCP LLC: Case Summary & its Largest Unsecured Creditor
------------------------------------------------------
Debtor: DCP, LLC
3750 West 500 South
Salt Lake City, UT 84104
Bankruptcy Case No.: 08-25336
Chapter 11 Petition Date: August 14, 2008
Court: District of Utah (Salt Lake City)
Debtor's Counsel: Daniel W. McKay
(dmckay@ahm-law.com)
Ascione Heideman & McKay
2696 North University Avenue
Suite 180
Provo, UT 84604
Telephone (801)812-1000
Fax (801)374-1724
Estimated Assets: $50,000,001 to $100 million
Estimated Debts: $10,000,001 to $50 million
Debtor's its Largest Unsecured Creditor:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Asset Development Group Materials & $500,000
1537 S 30 E Improvements
Payson, UT 84651
DCP LLC: Voluntary Chapter 11 Case Summary
------------------------------------------
Debtor: DCP, LLC
3750 West 500 South
Salt Lake City, UT 84104
Tel: (801) 908-0196
Related Information: On June 23, 2008, Wolper Construction Inc.
aka Wolper Landscaping and Construction,
which provides landscape counseling and
planning services, filed a voluntary Chapter
11 petition (Bankr. D. Utah Case No. 08-
24034) Andres Diaz, Esq. represented the
Debtor as counsel. Debtor and Wolper
Construction Inc. have common ownership.
Bankruptcy Case No.: 08-25336
Chapter 11 Petition Date: August 14, 2008
Court: District of Utah (Salt Lake City)
Judge: Hon. Judith A. Boulden
Debtor's Counsel: Daniel W. McKay, Esq.
Ascione Heideman & McKay
2696 North University Avenue
Suite 180
Provo, UT 84604
Tel: (801)812-1000
Fax: (801)374-1724
Email: dmckay@ahm-law.com
Estimated Assets: $50 million to $100 million
Estimated Debts: $10 million to $50 million
The Debtor did not file a list of its largest unsecured creditors.
DEBORAH MURRAY: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Deborah Murray
aka Deborah Lynn Murray
aka Deborah L Murray
1408 Harbor Walk Road
Tampa, FL 33602
Bankruptcy Case No.: 08-12263
Chapter 11 Petition Date: Aug. 14, 2008
Court: Middle District of Florida (Tampa)
Debtor's Counsel: David W Steen, Esq.
(dwslaw@yahoo.com)
David W Steen, PA
602 South Boulevard
Tampa, FL 33606-2630
Tel: (813) 251-3000
Fax: (813) 251-3100
Total Assets: $13,713
Total Debts: $$398,393
A list of the Debtor's largest unsecured creditors is available
for free at:
http://ResearchArchives.com/t/s?30d8
DIAMOND GLASS: Chapter 11 Plan Filing Period Extended to Nov. 28
----------------------------------------------------------------
The United States Bankruptcy Court for the District of Delaware
has extended the exclusive periods of Diamond Glass, Inc., and its
debtor-affiliate, DT Subsidiary Corp., to file a Chapter 11 plan
and to solicit acceptances of such a plan through November 28,
2008 and January 27, 2009, respectively.
The Debtors ask the Court for an extension of the Exclusive Filing
and Solicitation Periods to be able to negotiate and gather
adequate information in arrive at a consensual Chapter 11 plan
with their major creditor constituencies.
About Diamond Glass
Headquartered in Kingston, Pennsylvania, Diamond Glass Inc. --
http://www.diamongtriumph.com/or
http://www.daimondtriumphglass.com/-- provides automotive
glass replacement and repair services. Founded in 1923, Diamond
Glass had more than 1,600 employees as of March 15.
The company and and its debtor-affiliate DT Subsidiary Corp.,
filed for Chapter 11 bankruptcy petition on April 1, 2008 (Bankr.
D. Del. Lead Case No. 08-10601). Michael P. Richman, Esq., at
Foley & Lardner LLP, and Donald J. Bowman Jr., Esq., at Young
Conaway Stargatt & Taylor LLP, represent the Debtors in their
restructuring efforts. The U.S. Trustee for Region 3 appointed
five creditors to serve on an Official Committee of Unsecured
Creditors. John T. Carrol, III, Esq., and Jeffrey R. Waxman,
Esq., at Cozen O'Connor, represent the Committee in this case.
When the Debtors filed for bankruptcy protection, they listed
assets of between $10 million and $50 million and debts of between
$100 million and $500 million.
DISTRIBUTED ENERGY: Out of NASDAQ, AMEX, NYSE Naked Short List
--------------------------------------------------------------
BUYINS.NET said that these select companies have been removed from
the NASDAQ, AMEX and NYSE naked short threshold list: Rudy
Nutrition (OTC: RUNU), Distributed Energy Systems Corp. (OTC:
DESCQ), Eastern Platinum Ltd. (OTC: ELRFF), Experian plc (OTC:
EXPGY), ICAP plc (OTC: IAPLY), Sun Hung Kai Pptys Ltd Ord (OTC:
SUHJY). A complete list of companies on the naked short list, as
well as the SqueezeTrigger Price before a short squeeze starts in
any stock, are available at http://www.buyins.net.
About Distributed Energy
Based in Wallingford, Connecticut, Distributed Energy Systems
(Nasdaq: DESC) -- http://www.distributed-energy.com/-- through
its subsidiaries, engages in the design, development, manufacture,
and sale of on-site hydrogen gas delivery systems worldwide.
Distributed Energy Systems Corp. and its wholly owned subsidiary,
Northern Power systems Inc., filed for Chapter 11 bankruptcy
protection on May 4, 2008 (Bankr. D. Del. Lead Case No. 08-11101).
Robert S. Brady, Esq. and Robert F. Poppiti, Jr., at Young,
Conaway, Stargatt & Taylor represent the Debtors in their
restructuring efforts. The Debtors selected Epiq Bankruptcy
Solutions LLC as their claims agent. The U.S. Trustee for Region
3 appointed three creditors to serve on an Official Committee of
Unsecured Creditors. The Committee's Counsel is Arent Fox LLP.
The Debtors disclosed in its schedules, assets of $19,593,387 and
debts of $43,558,713.
DUNMORE HOMES: Court Confirms Amended Plan of Liquidation
---------------------------------------------------------
The United States Bankruptcy Court for the Southern District of
New York confirmed the Second Amended Plan of Liquidation of
Dunmore Homes, Inc. in a hearing held on August 12, 2008.
The Debtor contends that the Second Amended Plan satisfies the
confirmation requirements of the Bankruptcy Code, the Federal
Rules of Bankruptcy Procedure, and the Local Bankruptcy Rules for
the Eastern District of California.
The Debtor tells the Court it has worked to wind up its remaining
affairs, liquidate its personal property and other assets, and
reject unexpired leases and executory contracts that were either
burdensome to the estate or that did not contribute to its
objective of maximizing distributions to creditors. With most of
these tasks completed, the Debtor seeks confirmation of the Plan.
"Confirmation of the Plan will allow creditors to receive
distributions of beneficial interests in the liquidation trust on
account of their allowed claims while the Liquidation Trust
conducts the final tasks required to complete its administration
of the estate and, ultimately, seek entry of an order of final
decree thereby closing the Debtor's case," Maria A. Bove, Esq.,
at Pachulski Stang Ziehl & Jones LLP, in San Francisco,
California, notes, on the Debtor's behalf.
Debtor Addresses Confirmation Objections
The Debtor acknowledges that it has received four confirmation
objections and a joinder from Travelers Casualty and Surety
Company of America, Sidney B. Dunmore, City of Fresno, County of
Placer and Taberna Capital Management LLC.
Among others, the Objectors oppose the injunction provisions
under the Plan as overly broad; the Plan was not proposed in good
faith; and the Plan interferes with their rights against third
parties.
Placer County filed its objection July 30, 2008, arguing that the
Debtor failed to provide for the County's personal property taxes
in the proposed Plan of Liquidation.
In response to the objections, the Debtor asserts that the Plan
does not, by its plain language, implicate or seek to determine
any property interest or security of Travelers in Mr. Dunmore's
tax refund, any property interest of the City of Fresno or any
unmatured claim of Mr. Dunmore which might arise if he files a
personal bankruptcy case.
"The Plan simply provides that any Claims against the Debtor have
to be dealt with through the Plan," Ms. Bove emphasizes.
Ms. Bove adds that the only causes of action to be transferred to
the Liquidation Trust are causes of action that belong to the
Debtor's estate as a matter of law.
The Debtor cites that Taberna correctly noted that the Plan
provides for the voluntary assignment of third party claims. The
assignment is not required though and thus, to the extent Taberna
decides not to assign any claims it owns as a matter of law then
those claims will not be transferred to the Liquidation Trust,
Ms. Grassgreen elaborates.
As to the City of Fresno, the Debtor maintains that it had served
the City a notice of its bankruptcy filing and a bar date notice
as the City is listed in the Debtor's creditor matrix. The
Debtor also notes that the Plan does not affect the property
interests of third parties like Fresno.
In addition, the Debtor complain that as Placer County's
objection was filed 12 days after the Confirmation Objection
Deadline, it should be disregarded as untimely.
Nevertheless, in consultation with the Official Committee of
Unsecured Creditors, the Debtor propose to include these
immaterial modifications to the Plan to address the issues raised
by the Objectors:
* Nothing in the Plan will be deemed a determination of the
nature or extent of any property of the Debtor's estate or
will result in a determination of any parties' property
rights, including any rights of the City of Fresno in the CD
accounts, or any determination of the relative priorities of
security interests claimed by Travelers and the Debtor or
the Liquidation Trust in Mr. Dunmore's anticipated tax
refund.
* The Plan does not affect the rights of any party to claim
that an asset was not property of the Debtor's estate and
therefore not transferred to the Liquidation Trust.
* In response to Mr. Dunmore's concerns, the Debtor will
include language stating that any claim a party could
properly assert against the Debtor together with all
defenses will be preserved and will be paid in accordance
with the distribution provisions of the Liquidation Trust to
the extent the claims are allowed.
* If the Court determines that Placer County' objection should
be considered, the Debtor propose that Claim Subclass 2-A of
the Plan provide:
-- for full payment of any allowed claims in the class in
cash and in full;
-- that holders will retain their liens until payment in
full of their allowed claims; and
-- for interest on the claims to the extent permitted
under applicable law.
The Debtor acknowledges that Placer County has asserted a
secured tax claim for $13,619, and reserves its right to
dispute the Placer Claim.
The Debtor avers that the revised Plan language as to
Placer County's concern clarifies the treatment but does
not change the substantive result.
* The Debtor removed certain executory contracts from the Plan
exhibits which it deemed will not be a benefit to its
estate. The remaining contracts the Debtor seek to assume
are:
Termination
Counterparty Contract Type Date
------------ ------------- -----------
Sidney B. Dunmore Modification of Note N/A
and Loan Agreement
Paramount Equity Mortgage Lease and Sublease 09/30/08
Agreement
Parkway Plaza Investors Consent to Sublease 09/30/08
& Paramount Equity Agreement
Mortgage
Diepenbrock Harrison Attorney Engagement N/A
Agreement
Newmeyer & Dillion LLp Attorney Contingency N/A
Fee Arrangement
Wilke, Fleury, Hoffelt, Attorney Engagement N/A
Goul & Birney Agreement
Capital/Central Records Storage -
Records Storage
The Debtor aver that the modifications to the Second Amended Plan
are not material do not adversely affect creditors. "They are in
the nature of clarification and do not have any substantive
impact on the treatment of any Claims or Interests under the
Plan."
A blacklined copy of the Dunmore Second Amended Plan is available
for free at http://bankrupt.com/misc/2ndAmendedBlackline.pdf
After the Debtor filed its omnibus reply, Travelers withdrew its
confirmation objection. Thus, the Travelers objection is deemed
resolved. Likewise, Mr. Dunmore's objection, filed as a joinder,
should also be disregarded as moot or late.
Based in Granite Bay, California, Dunmore Homes Inc. is a
privately-owned homebuilder. The company filed for Chapter 11
protection on Nov. 8, 2007 (Bankr. S.D.N.Y. Case No. 07-13533).
Maria A. Bove, Esq., and Debra I. Grassgreen, Esq., at Pachulski
Stang Ziehl & Jones LLP, represent the Debtor in its restructuring
efforts. The Official Committee of Unsecured Creditors has
selected Morrison & Foerster LLP as its counsel in this bankruptcy
proceeding.
In January 2008, the U.S. Bankruptcy Court for the Southern
District of New York ordered the transfer of Debtor's Chapter 11
case to the U.S. Bankruptcy Court for the Eastern District of
California, Sacramento Division. The Debtor filed its plan of
liquidation and an accompanying disclosure statement on March 21,
2008. The company amended the Plan on April 24.
The California Bankruptcy Court approved Dunmore's Disclosure
Statement on June 12, 2008 as containing "adequate information"
within the meaning of Section 1125 of the Bankruptcy Code.
The Debtor disclosed $20,743,147 in total assets and $250,252,312
in total debts in its schedules of assets and liabilities filed
with the Court.
(Dunmore Homes Bankruptcy News, Issue No. 20; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
ELDORADO RESORTS: S&P Withdraws 'B' Ratings at Company's Behest
---------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its public ratings on
Eldorado Resorts LLC at the request of the company.
Ratings List
To From
Eldorado Resorts LLC
Corporate Credit Rating NR B/Stable/--
Senior Unsecured NR B+
Recovery Rating NR 2
NR--Not rated.
ESPRE SOLUTIONS: Gets $2MM for Private Placement of Debenture
-------------------------------------------------------------
Espre Solutions, Inc. closed on July 16, 2008, the private
placement of a debenture for gross proceeds of $2,000,000, of
which $250,000 was paid at closing and the balance of $1,750,000
is payable by a promissory note due January 30, 2011, to a single
institutional investor pursuant to a Securities Purchase Agreement
dated as of July 15, 2008.
The Debenture is convertible into shares of the Company's common
stock at a price equal to the dollar amount of the Debenture being
converted divided by a conversion price equal to the lesser of (i)
$0.65 or (ii) 82% of the three lowest Volume Weighted Average
Prices during the 20 trading days prior to the election to
convert, provided that if the Volume Weighted Average Price per
share is less than $0.10 on the date of election, the Company can
prepay the amount to be converted, plus accrued but unpaid
interest, at 115% of such amount. The Debenture is secured by the
pledge by non-affiliates of the Company of 6,000,000 shares of the
Company's common stock which the pledgors own. Interest is
payable on the Debenture at the rate of 6% per annum, paid monthly
on the 15th day of each month.
Interest on the purchaser's $1,750,000 Promissory Note is payable
at a rate of six and one-quarter percent (6¼%) per annum monthly
on the 15th day of each month. In the event that the Company's
common stock trades at a price of less than $0.06 per share or
lower at any time during the six month period commencing on the
date of the issuance of the Promissory Note, then the interest
payable on the Promissory Note is immediately decreased to four
and three-quarter percent (4¾%). The purchaser has the obligation
to prepay any portion of the Promissory Note on a monthly basis
commencing one hundred eighty (180) days from the issuance of the
Promissory Note on any date of such month during which the
Promissory Note remains outstanding in an amount equal to not less
than $500,000, provided that the purchaser can immediately sell
all of the common stock issued at conversion pursuant to Rule 144,
no Event of Default (as defined in the Debenture) has occurred,
the average Volume Weighted Average Price per share of the
Company's common stock for every period of ten consecutive trading
days during the term of the Promissory Note is not less than
$0.062 per share, and the Company shall have honored all
conversion notices submitted by the purchaser. The Promissory
Note is secured by substantially all the purchaser's assets and is
subordinated to any senior indebtedness of the purchaser.
In addition to the Debenture, the purchaser agreed, pursuant to
the Securities Purchase Agreement, to purchase a second debenture
in the principal amount of $2,000,000, payable $250,000 at closing
and the balance by a $1,750,000 promissory note, with both
instruments having the same terms as the Debenture and the
purchaser's $1,750,000 Promissory Note described above. If the
purchaser does not fund the second debenture, then its sole
liability to the Company shall be to pay the Company $25,000 as a
non-funding penalty, or $5,000 in the event that the Company's
common stock trades at $0.062 per share or lower at any time
during the six month period commencing with the date of issuance
of the Debenture. The purchaser also has the right not to fund
the second debenture under certain circumstances, including the
Company's common shares not trading on the OTC Bulletin Board or
the Company's common stock trading at a price that is $0.031 per
share or lower at any time during the six-month period following
the date of issuance of the Debenture.
The Company did not use any form of advertising or general
solicitation in connection with the sale of the Debenture. The
sale of the Debenture was made in reliance on an exemption
provided by Section 4(2) of the Securities Act of 1933, as
amended.
The Debenture and shares of common stock issuable upon conversion
of the Debenture (collectively, the "Securities") have not been
registered under the Securities Act and may not be offered or sold
in the United States absent registration under the Securities Act
and applicable state securities laws or an applicable exemption
from those registration requirements, and all certificates
representing the Securities are imprinted with a restrictive
legend to that effect.
In connection with the private placement, the Company incurred
expenses which included, without limitation, a finder's fee, legal
fees and other miscellaneous expenses of approximately $150,000.
The finder's fee is payable only upon the amount of cash received
by the Company; therefore only $17,500 was paid on the initial
drawdown of $250,000.
The description of the private placement in this Current Report on
Form 8-K does not purport to be complete and is qualified in its
entirety by reference to the Securities Purchase Agreement filed
as Exhibit 4.4, the Form of 6% Senior Convertible Debenture filed
as Exhibit 4.5, the Form of Secured Promissory Note filed as
Exhibit 4.6, and the Form of Stock Pledge Agreement filed as
Exhibit 4.7 to this Current Report on Form 8-K (collectively, the
"Transaction Documents"), all of which are incorporated herein by
reference. The Transaction Documents have been included to
provide investors and security holders with information regarding
their terms. They are not intended to provide any other factual
information about the Company. The Transaction Documents contain
certain representations, warranties and indemnifications resulting
from any breach of such representations or warranties. Investors
and security holders should not rely on the representations and
warranties as characterizations of the actual state of facts
because they were made only as of the respective dates of the
Transaction Documents. In addition, information concerning the
subject matter of the representations and warranties may change
after the respective dates of the Transaction Documents, and such
subsequent information may not be fully reflected in the Company's
public disclosures.
Amendments to Articles of Incorporation or Bylaws
On July 18, 2008, the Company filed a Certificate of Withdrawal
with respect to its Series A Cumulative Convertible Preferred
Stock, none of which was then issued or outstanding, and filed a
Certificate of Designation for its Series B Preferred Stock (the
establishing the rights, preferences, privileges, qualifications,
restrictions, and limitations relating to the Series B Preferred
Stock, of which 5,000,000 shares are authorized and none are
issued or outstanding.
Under the terms of the Series B Preferred Stock, the holders of
shares of that stock shall be entitled to receive a cumulative
quarterly cash dividend at an annual rate of $0.07 per share to be
paid in preference to the holders of shares of common stock.
Holders of Series B Preferred Stock shall be entitled to fifty
(50) votes for each share of Series B Preferred Stock held with
respect to any and all matters presented to the stockholders of
the Company. The consent of holders of a majority of Series B
Preferred Stock, voting separately as a single class, shall be
necessary for the Company to sell all or substantially all of the
Company's assets or effect any merger, consolidation, share
exchange or similar transaction to which the Company is a party.
Holders of Series B Preferred Stock shall have the right to
convert their shares of common stock at a ratio of five shares of
common stock for each share of Series B Preferred Stock The
Company can redeem Series B Preferred shares at any time at its
option at a redemption price of $2.50 per share plus any unpaid
dividends. Upon liquidation, holders of the Series B Preferred
Stock shall be entitled to $1.00 per share of Series B Preferred
Stock. Upon any merger of the Company with another company in
which the Company is not the surviving corporation, or the sale of
all or substantially all of the assets of the Company, holders of
Series B Preferred Stock are entitled to a preference of $1.00 per
share of the proceeds of any such transaction or event. The
Company has the obligation to register shares of common stock
underlying the Series B Preferred Stock under certain
circumstances described in the Certificate of Designation.
The terms of the Series B Preferred Stock are more fully described
in the Certificate of Designation establishing the rights,
preferences, privileges, qualifications, restrictions and
limitations relating to the Series B Preferred Stock.
The Company plans to issue an aggregate of 5,000,000 shares Series
B Preferred Stock to the Chief Executive Officer and the President
in August 2008 in consideration for the cancellation of 13,055,556
common shares and 4,938,272 warrants to purchase common shares
owned by the Officers.
Balance Sheet
As reported by the Troubled Company Reporter on May 29, 2008,
ESPRE Solutions Inc.'s consolidated balance sheet at March 31,
2008, showed $2,329,726 in total assets, $1,254,812 in total
liabilities, and $1,186,414 in minority interest, resulting in a
$111,500 total stockholders' deficit.
Going Concern
The company has incurred significant and recurring losses and
negative cash flow from operations.
In the period from inception to March 31, 2008, the company has
transacted a substantial amount of its business with related
parties. The company continues to be dependent on revenues from
these related parties. The achievement of profitability and the
ability to generate cash flows from operations is dependent upon,
among other things, the acceptance of the company's products and
services, competition from other products and the deployment of
video applications by the company's customers.
There is no assurance that management's plan will be successful.
Accordingly, the company believes substantial doubts exist about
its ability to continue as a going concern.
About Espre Solutions Inc.
Headquartered in Plano, Texas, ESPRE Solutions Inc. (OTC: EPRT.PK)
-- http://www.espresolutions.com/-- is a public company and media
collaboration solutions provider. ESPRE Solutions intends to be
the video solutions provider of choice for Internet Service
Providers, Enterprises, application developers, communications
hardware vendors, and chip manufacturers, by providing both
narrowband and broadband video solutions for integration into
traditional voice and data applications. ESPRE Solutions' ESPRE
Live(TM) Media Engine provides an integrated tool-kit solution for
developers to create applications for business and personal
communications.
>From its inception until the 1980's, the company provided planning
and environmental consulting services to local governmental
agencies and private organizations. The company filed reports
with the Securities and Exchange Commission until October 1981,
when it suspended its reporting obligations by notice filed with
the Commission.
EXACT SCIENCES: Faces Possible Delisting from Nadaq
---------------------------------------------------
EXACT Sciences Corporation received a letter from the Listing
Qualifications Staff of The NASDAQ Stock Market LLC indicating
that the company has not regained compliance with the $50 million
market value of listed securities requirement set forth in NASDAQ
Marketplace Rule 4450(b)(1)(A). The letter follows prior
correspondence from the Staff regarding the company's market value
of listed securities, which was disclosed in the company's press
release dated July 11, 2008.
The Staff has indicated that the company's common stock is subject
to delisting from NASDAQ and trading in the company's shares would
be suspended at the opening of business on Aug. 21, 2008, unless
the company requests a hearing before a NASDAQ Listing
Qualifications Panel. The company plans to request a hearing
before the Panel, which will postpone any delisting action until
the Panel renders a decision subsequent to the hearing.
Headquartered in Marlborough, Massachusetts, Exact Sciences
Corporation (NASDAQ: EXAS) -- http://www.exactsciences.com/-- is
an applied genomics company that develops deoxyribonucleic acid
(DNA)-based technologies for use in the detection of cancer. The
company has selected colorectal cancer as the first application of
its technologies. The company has licensed certain of its
technologies, on an exclusive basis through December 2010, to
Laboratory Corporation of America Holdings (LabCorp) in connection
with a commercial testing service that is marketed in the United
States under the name PreGen-Plus. PreGen-Plus, which is based on
its Version 1 technology, is the non-invasive stool-based DNA
testing service of LabCorp for the detection of colorectal cancer
in the average-risk population. Royalties from the sales of
PreGen-Plus of LabCorp, and other license fees from it, represent
its primary source of revenue.
On March 31, 2008, the balance sheet of the company showed cash
and cash equivalents of $3,999,000, total assets of $14,595,000,
total liabilities of $7,593,000 and a total deficit of
approximately $165.2 million since its inception in February 1995.
It has retained Leerink Swann LLC to assist the Board of Directors
in its evaluation of strategic alternatives for the business,
including, but not limited to, the sale of EXACT or merger with
another entity. It employs 14 people after slashing its workforce
to half last year.
FERRO CORP: $150MM Convertible Notes Gets 'B' Rating from S&P
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned a 'B' rating to Ferro
Corp.'s proposed $150 million 6.5% convertible senior unsecured
notes and a recovery rating of '5', indicating the expectation for
modest (10% to 30%) recovery in the event of a payment default. At
the same time, S&P affirmed its 'B+' corporate credit and secured
debt ratings on the company. The outlook is stable. S&P also
withdrew ratings on the proposed $200 million senior unsecured
notes due 2016 which the company no longer plans to issue.
Proceeds from the offering, along with cash and borrowings under
the revolving credit facility, will be used to redeem $200 million
of secured debt maturing in January 2009. The notes are
convertible into Ferro common stock at a specified threshold price
at the option of the holder.
FEY 240: Files Schedules of Assets & Liabilities
------------------------------------------------
Fey 240 North Brand LLC filed with the U.S. Bankruptcy Court for
the Central District of California, its schedules of assets and
liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $17,000,000
B. Personal Property $0
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $9, 907, 400
E. Creditors Holding
Unsecured Priority
Claims $0
F. Creditors Holding
Unsecured Non-priority
Claims $4,011,388
----------- -----------
TOTAL $17,000,000 $13,918,788
Pasadena, California-based Fey 240 North Brand LLC filed for
Chapter 11 protection on June 30, 2008 (Bankr. C.D. Calif. Case
No. 08-19512). John P. Schock, Esq. represents the Debtor in its
restructuring efforts. When the Debtor filed for protection from
its creditors, it listed estimated assets and debts of $10 million
to $50 million.
FOCUS ENHANCEMENTS: Receives Nasdaq's Bid Price Violation Notice
----------------------------------------------------------------
Focus Enhancements Inc. received a notice from the NASDAQ Staff
indicating the company did not regain compliance with the minimum
bid price requirement for continued listing set forth in NASDAQ
Marketplace Rule 4310(c)(4) during the compliance period provided
under NASDAQ rules, and instructed the company to present its
views with respect to this deficiency at the upcoming hearing
before a NASDAQ Listing Qualifications Panel.
On July 21, 2008, NASDAQ notified the company that it did not
comply with the minimum $35 million market value of listed
securities requirement for continued listing and that its shares
were subject to delisting unless the company requested a hearing.
The company timely requested a hearing before a NASDAQ Panel,
which stayed the Staff's delist determination. At the hearing,
the company will present its plan to comply with the bid price,
market value of listed securities and all other applicable
requirements for continued listing. The company's shares will
remain listed pending the issuance of a decision by the Panel.
However, there can be no assurances that the Panel will grant the
company's request for continued listing.
Headquartered in Campbell, California, Focus Enhancements Inc.
(NASDAQ: FCSE) -- http://www.Focusinfo.com/-- designs solutions
in advanced, proprietary video and wireless video technologies.
The company's Semiconductor Group develops wireless IC chip set
based on WiMedia UWB standard and design well as markets portable
ICs to the video convergence, portable media, navigation systems
and smartphone markets. The company's System Group develops video
products for the digital media markets, with customers in the
broadcast, video production, digital signage and digital asset
management markets.
Going Concern Doubt
The Troubled Company Reporter reported on April 8, 2008, Burr,
Pilger & Mayer LLP in San Jose raised substantial doubt about
Focus Enhancements Inc.'s ability to continue as a going
concern after auditing the company's consolidated financial
statements for the years ended Dec. 31, 2007, and 2006. The
auditing firm pointed to the company's recurring losses from
operations, net capital deficiency and accumulated deficit.
At March 31, 2008, the company's balance sheet showed total assets
of $29,726,000 and total liabilities of $30,479,000, resulting in
a stockholders' deficit of $753,000.
FORCE PROTECTION: Regulatory Filing Failure Cues Stocks Delisting
-----------------------------------------------------------------
Force Protection Inc. received a notice from the staff of The
Nasdaq Stock Market stating that the company is not in compliance
with Nasdaq Marketplace Rule 4310(c)(14) as a result of not filing
with the Securities and Exchange Commission its Form 10-Q for the
quarter ended June 30, 2008, and that Force Protection is subject
to having its stock delisted from the Nasdaq Capital Market.
The NASDAQ issued a Staff Determination Letter regarding the
continued listing of the company's stock on the Nasdaq Capital
Market due to the company's failure to file its Annual Report on
Form 10-K for the fiscal year ended Dec. 31, 2007, and issued an
Additional Staff Determination Letter regarding the company's
failure to file its Quarterly Report on Form 10-Q for the period
ended March 31, 2008. The Additional Staff Determination, dated
Aug. 12, 2008, indicates that non-compliance as a result of the
company's failure to file its Form 10-Q serves as an additional
basis for the delisting of the company's stock. At the company's
request, a hearing on the Staff Determination was conducted before
the Nasdaq Listing Qualifications Panel.
On May 29, 2008, the company received a letter from the Nasdaq
Hearings Panel granting its request for continued listing on the
Nasdaq Stock Market until Sept. 15, 2008, subject to certain
conditions. These conditions include, without limitation, that on
or before Sept. 15, 2008, Force Protection will file with the SEC
its Form 10-K for the fiscal year ended Dec. 31, 2007, the Form
10-Q for the fiscal quarter ended March 31, 2008 and any required
restatements. As a result, the company's common stock may remain
listed with the Nasdaq Capital Market until Sept. 15, 2008.
On March 3, 2008, Force Protection filed a Form 12b-25 with the
SEC which explains certain material weaknesses in internal control
over financial reporting identified by Force Protection for the
year ended Dec. 31, 2007.
Force Protection disclosed that as of April 10, 2008, the
company's Audit Committee had engaged Grant Thornton LLP as the
company's new independent registered public accounting firm for
the fiscal year ended Dec. 31, 2007, and the fiscal year ending
Dec. 31, 2008, effective as of April 10, 2008.
About Force Protection Inc.
Headquartered in Ladson, South Carolina, Force Protection Inc.
(NASDAQ:FRPT) -- http://www.forceprotection.net/-- is a designer,
developer and manufacturer of life saving survivability equipment,
predominantly ballistic- and blast-protected wheeled vehicles
currently deployed by the U.S. military and its allies to support
armed forces and security personnel in conflict zones. The
company's specialty vehicles, the Cougar and the Buffalo, and the
Cheetah, are designed specifically for reconnaissance, forward
command and control, and urban operations and to protect their
occupants from landmines, hostile fire, and improvised explosive
devices. The company's facility, located 10 miles from the
Charleston Air Force Base in Ladson, South Carolina, is on a 260-
acre campus consisting of three manufacturing buildings with a
combined floor area of approximately 452,240 square feet and an
additional 90,000 square feet.
FRONTIER AIRLINES: Receives $12.5MM DIP Loan from Republic Airways
------------------------------------------------------------------
Frontier Airlines Holdings Inc. and its subsidiaries notified the
U.S. Bankruptcy Court for the Southern District of New York that
Republic Airways Holdings Inc. has funded, on Aug. 8, 2008,
$12,500,000 of the $30,000,000 commitment, pursuant to the
Secured Superpriority Debtor-In-Possession Credit Agreement it
entered into with Frontier Airlines Holdings Inc.
On July 30, 2008, the Debtors received, an alternative debtor-in-
possession credit facility proposal from a group composed of
three major creditors, each of whom is a member of the Official
Committee of Unsecured Creditors:
* Republic Airways Holdings Inc.;
* Credit Suisse Securities (USA) LLC; and
* AQR Capital, LLC
Wells Fargo Bank Northwest, National Association, act as the
administrative and collateral agent for the Lenders. The New
Lender Group is offering Frontier up to $75,000,000 in DIP
financing, with an immediate firm commitment and funding of
$30,000,000.
Consequently, the Debtors obtained the Court's interim approval
to borrow up to an aggregate principal or face amount of
$30,000,000, in these commitments, according to Bloomberg News:
Lender Party Commitment
------------ ----------
Republic Airways $12,500,000
The Cayman Islands Branch 10,000,000
of Credit Suisse
AQR Capital, LLC and 6,500,000
AQR Absolute Return
Master Account L.P.
CNH Partners, LLC 1,000,000
Republic's chairman, Bryan Bedford, said that creditors thought
the Original DIP Credit Agreement with Perseus LLC, a merchant
bank and private equity fund management company, was "overly
beneficial to private equity group and detrimental to unsecured
creditors," Bloomberg reports.
Perseus offered Frontier with postpetition financing of up to
$75,000,000, in two installments, conditioned upon certain
concessions which were satisfactory to Perseus.
On behalf of the Debtors, Marshall S. Huebner, Esq., at Davis
Polk & Wardwell, in New York, said that the terms of the New DIP
Facility are materially more favorable to the Debtors than the
terms offered by their original DIP Facility with Perseus,
L.L.C., as administrative and collateral agent.
Mr. Huebner specified that the New DIP Facility provided for,
among other things, a lower interest rate, lower fees and
borrowing costs, substantially more effective availability and
less burdensome covenants.
Importantly, the New DIP Facility is also not predicated on the
Investment Agreement, which provides for Frontier's issuance to
Perseus of Class B Common Shares representing 79.9% of the total
equity capital of Frontier Holdings for $100,000,000, or any
other transaction to purchase the equity of the Reorganized
Debtors, Mr. Huebner pointed out.
Instead, he continues, the New DIP Facility will permit the
Debtors the flexibility to assess their reorganization options
from a position of greater financial strength.
The proposed New DIP funding, coupled with Frontier's recent
announcements of aircraft sales and sale leasebacks, is expected
to substantially increase Frontier's cash position and provide
sufficient working capital for the company's operations, well as
significant staying power in the market, according to the
Debtors' statement.
Moreover, the Debtors have gained the support of the Creditors
Committee with respect to the New DIP commitment, which "is a
tremendous vote of confidence in our Company and its business
plan," according to Sean Menke, Frontier's president and chief
executive officer, in a statement on the Company's Web site.
"After a careful examination of this offer against the offer
Perseus provided last week, we believe this new agreement offers
immediate access to greater liquidity under more favorable
terms," Mr. Menke added.
"Perseus [has not] committed on if they are still interested" in
pursuing the investment deal, Frontier spokesman Steve Snyder
told Bloomberg News.
The New DIP Facility
The New DIP Facility outlines principal differences, including:
Original
Term DIP Facility New DIP Facility
---- ----------------- ----------------
DIP Lenders Go Flip Go, L.L.C. Republic Airways Holdings,
and its permitted Inc., Credit Suisse,
assigns Cayman Islands Branch, AQR
Capital, LLC, AQR Absolute
Return Master Account,
L.P., CNH Partners, LLC,
CNH Diversified
Opportunities Master
Account, L.P. and their
permitted assigns
Administrative Perseus, L.L.C. Wells Fargo Bank Northwest,
Agent National Association
Borrowing $40,000,000 $30,000,000
Authorized by
Interim Order
Minimum Blocked $26,000,000 N/A
Cash Collateral
Required After
Initial Funding
Interest Accrued by At the Debtors' election
Payments increasing the from time to time either
outstanding (i) paid in cash, or (ii)
principal amount accrued by increasing the
of the Loans outstanding principal
amount of the Loans
Interest Rate 16.50% per annum Either (i) 14.00% per annum
if the Debtors are paying
the interest in cash, or
(ii) 16.00% per annum if
the interest is accruing by
increasing the outstanding
principal amount of the
Loans
Default 19.50% per annum 2.00% per annum above the
Interest Rate rate otherwise applicable
Maturity the earlier of (i) the earlier of (i) the
the effective date effective date of a Plan,
of a Plan of and (ii) April 11, 2009
Reorganization
(ii) September 30,
2009, and (iii)
the occurrence of
any of various
triggers related
to the Equity
Investment
Borrowing include approval no investment agreement or
Conditions of the proposed auction required
Investment
Agreement
Voluntary $5,000,000 $2,500,00
Prepayment
Increments
Voluntary $26,000,000 N/A
Prepayment
Floor
Prepayment 2.5% after 1%
Fee initial funding,
and 2% after
second funding
Early $1,000,000 after N/A
Termination initial funding,
Fee and $1,500,000
after second
funding
Total $2,000,000 $1,500,00
Commitment
Fee
Under the New DIP Facility, the Debtors are required to obtain
the confirmation of their Reorganization Plan by Sept. 20, 2009.
Additionally, the Debtors will investigate and pursue
opportunities to hedge the risks associated with fluctuations in
jet fuel prices, including without limitation swap and option
contracts for West Texas Intermediate Crude Oil, Gulf Coast Jet A
fuel and "crack spread" contracts.
Upon the request of Wells Fargo, the Debtors will provide reports
relating to their current or contemplated hedging activity and
the progress of its investigation into hedging alternatives.
As liquidity initiatives, the Debtors will sell or otherwise
dispose of no fewer than five A319 aircraft, to the extent that
certain aircraft disposition transactions are not consummated.
The Debtors covenant that at the end of each fiscal month, the
amount equal to the sum of EBITDAR for the 4-month period on a
consolidated basis will not be less than:
Fiscal Month EBITDAR
------------ -------
September 2008 $11,300,000
October 2008 $4,500,000
November 2008 $(3,600,000)
December 2008 $(8,000,000)
January 2009 $700,000
February 2009 $1,100,000
March 2009 $22,000,000
In order to ensure that the Carve-Out, if implicated, will be
adequately funded, the Debtors will have an aggregate cash-on-
hand of at least $15,000,000. The Carve-Out funds will be used
to satisfy any unpaid fees pursuant to Section 1930 of the
Judiciary and Judicial Procedures Code, and Sections 330, 331 and
726(b) of the Bankruptcy Code.
A blacklined copy of the New DIP Facility is available at no
charge at:
http://bankrupt.com/misc/FrontierNewDIPFacility_blacklined.pdf
Teamsters and FAPA Object to Perseus Deal
The Debtors' Original DIP Credit Facility with Perseus sought
authorization to obtain postpetition financing of up to
$75,000,000, in two installments. The second installment of
$35,000,000 was conditioned upon certain concessions which were
satisfactory to the Perseus.
Specifically, the DIP Credit Agreement required the Debtors to,
among other things, deliver to Perseus "new or revised collective
bargaining agreements or amendments containing concessions
necessary to meet labor cost reductions" with respect to:
(a) Frontier Airlines Pilots Association; and
(b) Teamsters Airline Division representing aircraft and
ground service equipment technicians and tool room
attendants.
The Unions' Bargaining Agreements with Frontier
The International Brotherhood of Teamsters represents 435 of the
Debtors' mechanics and material specialists, and appearance
agents through three separate CBAs, which, upon settlement
agreements between the parties, effected temporary reductions to
wages, among other terms, that were necessary to facilitate the
Debtors' search for DIP financing, Jill M. Hartley Esq., at
Previant, Goldberg, Uelmen, Gratz, Miller & Brueggeman, S.C., in
Milwaukee, Wisconsin, relates.
According to Ms. Hartley, the Debtors and the Teamsters reached
settlement agreements to the CBAs effective from May 24, 2008, to
September 26, 2008. The Agreements specifically provide for:
(i) temporary pay reductions through September 26, 2008;
(ii) holiday pay reductions for the 2008 Memorial Day,
Independence Day and Labor Day holidays; and
(iii) elimination of Company 401k matching contributions through
September 26, 2008 for Teamster-represented employees.
Furthermore, the parties agreed that upon expiration of the
temporary reductions, the Contracts' wages and benefits
provisions would be open for modification as of October 1, 2008,
while non-economic terms in the labor agreements would not be
addressed until January 1, 2009, Ms. Hartley adds.
Ms. Hartley says that the Debtors negotiated a term in the
Interim Concession Agreement, allowing Frontier to initiate
negotiations no later than September 1, 2008, to bargain an
extension of the concessions contained in the Agreement, as a
result of a lack of improvement in the Company's economic
condition. The company did not raise the prospect of presenting
a new proposal for additional concessions by September 1, 2008,
during the parties' negotiations for the interim agreement, she
maintains.
Representing FAPA, Suzanne Hepner, Esq., at Levy Ratner, P.C., in
New York, relates that CBA between the Debtors and FAPA covers
the period from March 2, 2007, through March 2, 2011.
The Debtors and FAPA, on June 1, 2008, entered into an interim
restructuring relief agreement that temporarily modified pay
rates and pension contributions under the CBA to achieve a
targeted savings of $4,570,000. Pursuant to its terms, the
Interim Agreement will "[become] null and void, and of no further
force and effect on September 30, 2008," Ms. Hepner tells the
Court.
Teamsters and FAPA: 2nd Installment Condition
To DIP Agreement "Inappropriate"
The Teamsters maintain that the Debtors' DIP Credit Agreement "is
a blatant attempt to circumvent the strict requirements of
Section 1113 of the Bankruptcy Code, which governs rejection of
collective bargaining agreements."
Moreover, the Lenders -- which conditioned the DIP Financing on
labor concessions which have not yet been negotiated -- are
attempting to dictate modifications to the CBAs, which can only
be accomplished by negotiations between the Debtors and the
Teamsters, to which the Lenders are not signatories, and
therefore, lack the standing to participate, Ms. Hartley
maintains.
If the Court approves the DIP Credit Agreement, the Debtors will
seek to obtain labor concessions which are acceptable to the
Lenders. Assuming the Teamsters' refusal to concede with wage
and benefit reductions, the Court will be presented with a fait
accompli in rejecting the CBA -- the only option to maintain the
DIP financing necessary for the Company to survive, Ms. Hartley
avers.
The DIP Credit Agreement must be rejected as an impermissible
attempt to bypass the strict requirements of Section 1113 of the
Bankruptcy Code, Ms. Hartley contends.
Similarly, FAPA objects to the conditioning of the second
installment of the DIP Credit Facility upon the Debtors'
unilateral promise to modify or reject the CBA in violation of
Section 1113.
FAPA argues that the Debtors' DIP Credit Agreement "attempts to
evade" the dictates of Section 1113(f) of the Bankruptcy Code,
which prohibits them from unilaterally altering the terms of the
CBA.
"Therefore, unless the Debtors move to assume or reject the CBA
under Section 1113, they remain bound to its terms and
conditions," Mr. Hepner maintains, citing In re Ionosphere Clubs,
Inc., 922 F.2d 984, 990 (2d Cir. 1990).
By requiring that the Debtors modify the CBA to obtain labor
concessions from FAPA to satisfy the requirement, the Lenders are
seeking "to participate" in the Debtors' unilateral modification
of the CBA, which is "entirely inappropriate" in the Debtors'
cases because the Lenders are neither parties nor guarantors to
FAPA's CBA with the Debtors, Ms. Hepner avers.
Debtors Talk Back
According to the Debtors, the Teamsters' and FAPA's arguments
regarding a possible Court hearing pursuant to Section 1113 of
the Bankruptcy Code, "is not ripe and not relevant" because the
proposed DIP Facility would not effectuate any modification or
termination of any of the Debtors' CBAs."
"Contrary to the Unions' claims, the Lenders do not have any
right to change the Debtors CBAs; they just have the right to
pick up their marbles and go home if any number of things, this
being one of them, does not work out," Marshall S. Huebner, Esq.,
at Davis Polk & Wardwell, in New York, says.
Mr. Huebner relates that the DIP Lenders have insisted on a given
cost structure or the right to call their loans under certain
circumstances, while "all possible rights of the Unions are
expressly preserved."
If the negotiations do not result in consensual agreements with
the Unions, the Debtors intend to engage in the Section 1113
Process to seek any needed modifications or terminations, Mr.
Huebner says.
Additionally, the Court's approval of their DIP Credit Agreement
was proposed in a way that will not impact the Teamsters' and
FAPA's rights as unions under Section 1113 of the Bankruptcy
Code, Mr. Huebner points out.
Mr. Huebner submits that the Official Committee of Unsecured
Creditors supports the Debtors' proposed New DIP Facility.
Moreover, the Debtors' restructuring, and the livelihood of the
Unions' members, would be placed in grave jeopardy absent the DIP
Facility, Mr. Huebner tells the Court..
About Frontier Airlines Inc.
Headquartered in Denver, Colorado, Frontier Airlines Inc. --
http://www.frontierairlines.com/-- provide air transportation
for passengers and freight. They operate jet service carriers
linking their Denver, Colorado hub to 46 cities coast-to-coast,
8 cities in Mexico, and 1 city in Canada, well as provide
service from other non-hub cities, including service from 10
non-hub cities to Mexico. As of May 18, 2007 they operated 59
jets, including 49 Airbus A319s and 10 Airbus A318s.
The Debtor and its debtor-affiliates filed for Chapter 11
protection on April 10, 2008, (Bankr. S.D. N.Y. Case No.: 08-
11297 thru 08-11299.) Hugh R. McCullough, Esq., at Davis Polk &
Wardwell, represents the Debtors in their restructuring efforts.
Togul, Segal & Segal LLP is the Debtors' Conflicts Counsel, Faegre
& Benson LLP is the Debtors' Special Counsel, and Kekst and
Company is the Debtors' Communications Advisors. At Dec. 31,
2007, Frontier Airlines Holdings Inc. and its subsidiaries'
total assets was $1,126,748,000 and total debts was
$933,176,000.
(Frontier Airlines Bankruptcy News, Issue No. 18; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
FRONTIER AIRLINES: To Delay Filing of Quarter Ended June 30 Report
------------------------------------------------------------------
In a regulatory filing with the Securities and Exchange
Commission dated Aug. 11, 2008, Frontier Airlines Holdings Inc.
disclosed that it will not be able to file its quarterly
report on Form 10Q for the quarter ended June 30, 2008.
According to Matthew Henry, Frontier's vice president and general
counsel, the Quarterly Report will be filed 15 days after the due
date. In the alternative, a portion of the Report will be filed
five days following the Due Date.
Frontier was able to file all other periodic reports during the
preceding 12 months, as required under Section 13 or 15(d) of the
Securities Exchange Act of 1934 or Section 30 of the Investment
Company Act of 1940, Mr. Henry discloses.
Mr. Henry says that Frontier will report a net loss of
approximately $57,700,000, or $1.56 loss per diluted common
share, for the quarter, compared to a net loss of $3,500,000, or
$0.10 loss per diluted common share, for the three months ended
June 30, 2007.
The increased net loss is primarily attributable to the 62.1%
increase in fuel costs per gallon during quarter ended June 30,
2008, as compared to last year, Mr. Henry notes.
About Frontier Airlines Inc.
Headquartered in Denver, Colorado, Frontier Airlines Inc. --
http://www.frontierairlines.com/-- provide air transportation
for passengers and freight. They operate jet service carriers
linking their Denver, Colorado hub to 46 cities coast-to-coast,
8 cities in Mexico, and 1 city in Canada, well as provide
service from other non-hub cities, including service from 10
non-hub cities to Mexico. As of May 18, 2007 they operated 59
jets, including 49 Airbus A319s and 10 Airbus A318s.
The Debtor and its debtor-affiliates filed for Chapter 11
protection on April 10, 2008, (Bankr. S.D. N.Y. Case No.: 08-
11297 thru 08-11299.) Hugh R. McCullough, Esq., at Davis Polk &
Wardwell, represents the Debtors in their restructuring efforts.
Togul, Segal & Segal LLP is the Debtors' Conflicts Counsel, Faegre
& Benson LLP is the Debtors' Special Counsel, and Kekst and
Company is the Debtors' Communications Advisors. At Dec. 31,
2007, Frontier Airlines Holdings Inc. and its subsidiaries'
total assets was $1,126,748,000 and total debts was
$933,176,000.
(Frontier Airlines Bankruptcy News, Issue No. 18; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
FRONTIER AIRLINES: Section 341(a) Meeting Moved to September 22
---------------------------------------------------------------
Frontier Airlines Holdings Inc. and its subsidiaries notified The
U.S. Bankruptcy Court for the Southern District of New York and
parties-in-interest that the first meeting of creditors of
Frontier Airlines, pursuant to Section 341 of the Bankruptcy Code,
has been rescheduled to Sept. 22, 2008, at 1:30 p.m., prevailing
Eastern Time.
The Meeting will be held at the Office of the United States
Trustee, 80 Broad Street, 4th Floor, in New York.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtors under oath about Frontier's financial affairs and
operations that would be of interest to the general body of
creditors.
Headquartered in Denver, Colorado, Frontier Airlines Inc. --
http://www.frontierairlines.com/-- provide air transportation
for passengers and freight. They operate jet service carriers
linking their Denver, Colorado hub to 46 cities coast-to-coast,
8 cities in Mexico, and 1 city in Canada, well as provide
service from other non-hub cities, including service from 10
non-hub cities to Mexico. As of May 18, 2007 they operated 59
jets, including 49 Airbus A319s and 10 Airbus A318s.
The Debtor and its debtor-affiliates filed for Chapter 11
protection on April 10, 2008, (Bankr. S.D. N.Y. Case No.: 08-
11297 thru 08-11299.) Hugh R. McCullough, Esq., at Davis Polk &
Wardwell, represents the Debtors in their restructuring efforts.
Togul, Segal & Segal LLP is the Debtors' Conflicts Counsel, Faegre
& Benson LLP is the Debtors' Special Counsel, and Kekst and
Company is the Debtors' Communications Advisors. At Dec. 31,
2007, Frontier Airlines Holdings Inc. and its subsidiaries'
total assets was $1,126,748,000 and total debts was
$933,176,000.
(Frontier Airlines Bankruptcy News, Issue No. 18; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000)
GLEN ROSE: Hein & Associates Expresses Going Concern Doubt
----------------------------------------------------------
Dallas-based Hein & Associates LLP raised substantial doubt about
Glen Rose Petroleum Corporation's ability to continue as a going
concern after auditing the company's financial statements for the
year ended March 31, 2008. The auditor said that the company has
limited capital resources and no significant revenue producing
assets, which combine to raise substantial doubt about its ability
to continue as a going concern.
The company posted a net loss of $3,251,650 on total operating
revenues of $62,025 for the year ended March 31, 2008, as compared
with a net loss of $11,435,134 on total operating revenues of
$1,014,734 in 2007.
The company had a working capital deficit of $2,714,405 at
March 31, 2008. The company is currently looking for financing to
provide the needed funds for operations. The company, however,
can provide no assurance that it will be able to obtain the
financing it needs to develop its properties and alleviate doubt
about its ability to continue as a going concern.
Balance Sheet
At March 31, 2008, the company's balance sheet showed $6,074,484
in total assets, $2,957,989 in total liabilities, and $3,116,495
in total stockholders' equity.
The company's consolidated balance sheet at March 31, 2008, showed
strained liquidity with $155,666 in total current assets available
to pay $2,870,071 in total current liabilities.
A full-text copy of the company's 2008 annual report is available
for free at http://ResearchArchives.com/t/s?30a3
At March 31, 2007, the company owned 404,204 shares of restricted
common stock in Cano Petroleum, Inc., of $1,827,000. The shares
secured a loan from Lothian Oil, Inc., and were delivered to
Lothian Oil, Inc., effective June 30, 2007, in satisfaction of the
loan. The company currently does not hold equity or debt
securities issued by other companies.
Subsequent Events
On May 27, 2008, the company signed a letter of intent to sell for
$2.5 million a 50% working interest in 2,560 acres of its Wardlaw
Field to Wind Hydrogen Limited, a publicly listed company on the
Australian Stock Exchange.
The Wardlaw lease is a 10,502 gross acre field located in Edwards
County, Tex. In addition, WHL has purchased two options for
$150,000 each to expand the venture for Phase 2 for 2,560 for $3
million for a 50% interest, and for Phase 3 for an additional
2,560 acres for $4 million for a 50% working interest. The WHL
joint venture has received approval from WHL's shareholders, has
completed preliminary due diligence, and is contemplated signing
of a definitive Participation Agreements by mid July.
On June 30, 2008, the board of directors approved the WindHydro
Participation agreement in which the company has received $250,000
in May 2008 as the down payment for Phase 1, as well as $270,000
in late June as a PIPE financing. The company's shareholders have
approved the letter of intent, and they are expected to sign the
Participation Agreement over the next few weeks.
On June 30, 2008, the board approved the offer by Richardson Patel
to convert their May 2008 billing into common stock, subject to
the Blackwood Capital Limited's approval.
On June 30, 2008, the board approved a 1 for 200 reverse split of
the stock, then an immediate purchase of the fractional shares at
the then market price, and then on the same day a 200 for 1
forward split. The result (based on shareholders of record as of
April 28, 2008 would be the repurchase of around 18,000 shares,
which would eliminate 1,385 shareholders, which hold an average of
13 shares. This would leave about 93 shareholders of record.
About Glen Rose Petroleum
Dallas-based Glen Rose Petroleum Corp. (NasdaqCM: GLRP) --
http://www.glenrosepetroleum.com-- is an independent producer of
natural gas and crude oil. The Company operates its business
through its wholly owned subsidiaries, UHC Petroleum Corporation
(Petroleum), and UHC Petroleum Services Corporation (Services),
which are sometimes collectively referred to in this report as the
"subsidiaries." Its other subsidiaries are UHC New Mexico
Corporation and National Heritage Sales Corporation, which
formerly sold food products. UHC New Mexico Corporation and
National Heritage Sales Corporation are no longer operating.
GUARDIAN TECHNOLOGIES: Enters into Consulting Deal with BND
-----------------------------------------------------------
Guardian Technologies International, Inc. entered on July 17,
2008, into a consulting agreement with BND Software, a corporation
that is owned and controlled by Sean Kennedy, a director of the
Company. BND will provide certain consulting services to the
Company including managing the research, development and
information systems activities of the Company.
The agreement is for term of one year commencing on May 27, 2008,
and expires on May 31, 2009. The agreement shall be extended for
a 12-month period upon mutual agreement by both parties. The
agreement may be terminated upon 60 days prior written notice by
one party to the other party.
As reported by the Troubled Company Reporter on May 29, 2008,
Guardian Technologies International Inc.'s consolidated balance
sheet at March 31, 2008, showed $1,189,447 in total assets,
$9,899,198 in total liabilities, and $148,089 in common shares
subject to repurchase, resulting in a $8,857,840 total
stockholders' deficit.
Going Concern Disclaimer
Goodman & Company, LLP, in Norfolk, Va., expressed substantial
doubt about Guardian Technologies International Inc.'s ability to
continue as a going concern after auditing the company's
consolidated balance sheet for the year ended Dec. 31, 2007.
The auditing firm reported that the company has incurred
significant operating losses since inception and is dependent upon
its ability to obtain additional funding through debt or equity
financing to continue operations. As a result, the auditing firm
said that the company may not be able to continue to meet
obligations as they come due.
About Guardian Technologies
Based in Herndon, Va., Guardian Technologies International Inc.
(OTC BB: GDTI) -- http://www.guardiantechintl.com/ -- is a
technology company that designs and develops imaging informatics
solutions for delivery to its target markets: aviation/homeland
security and healthcare.
HANOVER CAPITAL: Elects to Defer Interest Payment to WTC
--------------------------------------------------------
Hanover Capital completed on November 4, 2005, a private placement
of $20 million of trust preferred securities through Hanover
Statutory Trust II, a statutory trust formed by the Company for
that purpose. In connection with that issuance, the Company
entered into a Purchase Agreement dated November 4, 2005, among
the Company, the Trust and Citigroup Global Markets, Inc., and an
Amended and Restated Declaration of Trust, dated November 4, 2005,
among the Company and Wilmington Trust Company, as Delaware
trustee and as institutional trustee pursuant to which the
Securities were issued. The proceeds from the sale of the
Securities were used by the Trust to purchase from the Company
$20,619,000 in aggregate principal amount of the Company's junior
subordinated notes due 2035. The Notes were issued pursuant to a
junior subordinated indenture, dated November 4, 2005, by and
between the Company and WTC.
On July 16, 2008, the Company provided WTC with notice that,
pursuant to Section 2.11 of the Indenture, it elected to defer the
next payment of interest on the Securities, for the quarterly
interest payment that was due on July 31, 2008.
The Company has the right, pursuant to Section 2.11 of the
Indenture, upon appropriate notice, to defer the payment of
interest for a period of up to four (4) consecutive quarterly
interest periods, so long as no Event of Default has occurred and
is continuing, subject to certain other restrictions set forth in
Section 3.08 of the Indenture.
Section 5.01(c) of the Indenture clarifies that if interest
payments are being deferred during an Extension Period, this shall
not constitute an Event of Default under the Indenture.
As reported by the Troubled Company Reporter on May 30, 2008,
Hanover Capital Mortgage Holdings Inc.'s consolidated balance
sheet at March 31, 2008, showed $83,500,000 in total assets, and
$132,500,000 in total liabilities, resulting in a $49,000,000
total stockholders' deficit.
Going Concern Disclaimer
As reported in the Troubled Company Reporter on April 10, 2008,
Grant Thornton LLP, in New York, expressed substantial doubt about
Hanover Capital Mortgage Holdings Inc.'s ability to continue as a
going concern after auditing the company's consolidated financial
statements for the years ended Dec. 31, 2007, and 2006.
The auditing firm said that the company has lost $80,000,000 for
the year ended Dec. 31, 2007, which included $76,000,000 in
impairment losses on mortgage-backed securities and the company
has terminated certain loan facilities because of covenant
violations and, as a result, these facilities are no longer
available to the company.
About Hanover Capital
Based in Edison, N.J., Hanover Capital Mortgage Holdings Inc.
(AMEX: HCM) -- http://www.hanovercapitalholdings.com/-- is a
mortgage real estate investment trust. The company invests in
prime mortgage loans and mortgage securities backed by prime
mortgage loans.
HOME INTERIORS: Wants Court to Approve Employee Incentive Plans
---------------------------------------------------------------
Home Interiors & Gifts Inc. asks the United States Bankruptcy
Court for the Northern District of Delaware to approve two amended
incentive plans to repay at least $602,973 in cash to 53
employees, Bloomberg News reports.
The first incentive plan will pay $387,298 in cash to 48 employees
while the other plan will pay $387,298 to five company officers,
Bloomberg reports. The incentive plans are intended to stop the
Debtor's employees from leaving, the report says.
A hearing is set for Sept. 3, 2008, at 9:00 a.m., Central Daylight
Time, at 1100 Commerce Street, 14th Floor, Courtroom #2 in Dallas,
Texas.
Briefly Noted
As reported in the Troubled Company Reporter on Aug. 1, 2008, the
Debtor asked the Court to extend their exclusive periods to (a)
file a Chapter 11 until Dec. 25, 2008, and (b) solicit acceptances
of that plan until Feb. 23, 2009. A hearing was set for Aug. 20,
2008, at 9:00 a.m., to consider the motion.
About Home Interiors
Headquartered in Carrollton, Texas, Home Interiors & Gifts, Inc.
-- http://www.homeinteriors.com/-- manufactures, imports and
distributes indoor and outdoor home decorative accessories. It
was founded by Mary Crowley in 1957. Through its affiliates,
the company has a significant presence in Mexico, Puerto Rico,
and Canada. Annual revenue in 2007 reached US$300 million. When
Mary Crowley, died in 1986, her son, Don Carter continued the
business operation nearly debt-free. In a leveraged transaction
in 1998, private equity firm of Hicks, Muse, Tate, and Furst
acquired 66% of the parent company, which resulted in the
imposition of more than $500 million in debt on the Debtors. In
the face of decreased sales and increased debt load, bondholders
canceled their debts in February 2006 in exchange for receiving
most of the outstanding equity of the Debtors.
About 40% of the goods the Debtors sell are now acquired from
manufacturers in China. In the last decade, sales volume in the
U.S. has waned, but the Debtors reported that sales in Mexico
and Puerto Rico significantly increased.
The company and six of its affiliates filed for Chapter 11
protection on April 29, 2008 (Bankr. N.D. Tex. Lead Case No.08-
31961). Andrew E. Jillson, Esq., Cameron W. Kinvig, Esq.,
Lynnette R. Warman, Esq., and Michael P. Massad, Jr., Esq., at
Hunton & Williams, LLP, represent the Debtors in their
restructuring efforts. The U.S. Trustee for Region 6 has
appointed seven creditors to serve on an Official Committee
of Unsecured Creditors. Richard A. Lindenmuth, at Boulder
International LLC, is designated as CRO. Munsch Hardt Kopf &
Harr PC represents the Committee in these cases. When the
Debtors file for protection against their creditors, they
listed assets of between $100 million and $500 million and the
same range of debts.
INTERMET CORP: U.S. Trustee to Hold Meeting to Form Panel Today
---------------------------------------------------------------
Roberta A. DeAngelis, the acting United States Trustee for Region
3, will hold an organizational meeting in the Chapter 11 cases of
Intermet Corp. today Aug. 19, 2008 at 10:00 a.m. at The DoubleTree
Hotel at 700 King Street in Wilmington, Delaware.
The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtors' cases.
The organizational meeting is not the meeting of creditors
pursuant to Section 341 of the Bankruptcy Code. A representative
of the Debtor, however, may attend the Organizational Meeting,
and provide background information regarding the bankruptcy
cases.
Headquartered in Fort Worth, Texas, Intermet Corp. designs and
manufactures machine precision iron and aluminum castings for the
automotive and industrial markets. The company and its debtor-
affiliates filed for Chapter 11 protection on August 12, 2008 (D.
Del. Case Nos. 08-11859 to 08-11866 and 08-11868 to 08-11878).
James E. O'Neill, Esq., Laura davis Jones, Esq. and Timothy P.
Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington,
Delaware, represent the Debtors. When the Debtors filed for
protection from their creditors, they listed assets between $50
million and $100 million and total debts between $100 million and
$500 million.
INTERSTATE BAKERIES: Withdraws Request to Reject CBA with UFCW
--------------------------------------------------------------
Interstate Bakeries Corp. and its debtor-affiliates informed the
U.S. Bankruptcy Court for the Western District of Missouri and
parties-in-interest on July 29, 2008, that they have withdrawn
their request to reject their collective bargaining agreements
with the United Food and Commercial Workers.
The Debtors did not state the reason for the withdrawal of their
request.
The Debtors reported on July 9, 2008, that they reached
modification agreements with 16 local affiliates of the
United Food and Commercial Workers.
This covered the collective bargaining agreements of, and were
ratified by, Local 2, Local 21, Local 44, Local 23, Local 101,
Local 367, Local 373, Local 431, Local 555, Local 655, Local 700,
Local 870, Local 881, Local 1059, Local 1099, Local 1179, Local
1473 and Local 1546, as well as Locals 5 and 8 which represent
employees formerly covered by Local 588.
Union Claims Resolved
Counsel for the Debtors, J. Eric Ivester, Esq., at Skadden Arps
Slate Meagher & Flom, LLP, in Chicago, Illinois, inform the
Court that since the bankruptcy filing, approximately 400
prepetition union claims have been resolved, aggregating:
* $260,000 as of June 13, 2008; and
* $270,000 as of August 14, 2008.
The Court previously directed Interstate Bakeries Corporation and
its debtor-affiliates to file, every 60 days, a summary statement
of the number of prepetition union grievances that have been
resolved and the aggregate amount of grievance resolutions.
About IBC
Headquartered in Kansas City, Missouri, Interstate Bakeries
Corporation is a wholesale baker and distributor of fresh-baked
bread and sweet goods, under various national brand names,
including Wonder(R), Baker's Inn(R), Merita(R), Hostess(R) and
Drake's(R). Currently, IBC employs more than 25,000 people and
operates 45 bakeries, as well as approximately 800 distribution
centers and approximately 800 bakery outlets throughout the
country.
The company and eight of its subsidiaries and affiliates filed for
chapter 11 protection on Sept. 22, 2004 (Bankr. W.D. Mo. Case No.
04-45814). J. Eric Ivester, Esq., and Samuel S. Ory, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors
in their restructuring efforts. When the Debtors filed for
protection from their creditors, they listed $1,626,425,000 in
total assets and $1,321,713,000 (excluding the $100,000,000 issue
of 6% senior subordinated convertible notes due Aug. 15, 2014) in
total debts. The Debtors' filed their Chapter 11 Plan and
Disclosure Statement on Nov. 5, 2007. Their exclusive period to
file a chapter 11 plan expired on November 8. On Jan. 25, 2008,
the Debtors filed their First Amended Plan and Disclosure
Statement. On Jan. 30, 2008, the Debtors received Court approval
of the First Amended Disclosure Statement.
IBC confirmed that it has not received any qualifying alternative
proposals for funding its plan of reorganization in accordance
with the Court-approved alternative proposal procedures. As a
result, no auction was held on Jan. 22, 2008, as would have been
required under those procedures. The deadline for submission of
alternative proposals was Jan. 15, 2008. A new plan filing
deadline was set for June 30, 2008; no plan was filed as of that
date.
(Interstate Bakeries Bankruptcy News, Issue No. 104; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000).
INTERSTATE BAKERIES: Wants Court to OK California Properties Sale
-----------------------------------------------------------------
Interstate Bakeries Corp. and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Western District of Missouri to authorize
and approve the sale of their interest in:
(i) a bakery property located at 5849 Crocker Street, and
(ii) a retail property with address at 350-374 East Slauson in
Los Angeles, California, to Simantov Eshaghian, as the
proposed purchaser, or to better bidders, in accordance
with the bidding procedures with respect to the Properties.
The Bakery and Retail Properties
The Proposed Sale involves various parcels of property,
including:
(a) the bakery property, which was formerly used as a bakery
and is comprised of approximately 3.34 acres of land with
several buildings located, totaling approximately 64,249
square feet of space; and
(b) the retail property, which is currently being used as a
depot and thrift store and is comprised of approximately
0.49 acres of land with two buildings, totaling 6,623
square feet of space.
In the process of winding down their depot and thrift store
operations, the Debtors are selling the Properties subject to:
-- a restrictive covenant to be recorded in the real property
records of Los Angeles County, prohibiting the use of the
Properties as a Commercial Bakery for the 60-month period
following the closing of the sale of the Property;
-- the leaseback of the Bakery Property by the Debtors for
a period of up to 60 months; and
-- the leaseback of the Retail Property by the Debtors for a
period of up to 60 months, with two 60-month renewal
options.
The Bakery Lease provides that monthly base rent is $12,000;
thus, the total base rent for its full 6-month term -- if the
Debtors do not terminate the Bakery Lease earlier -- is $72,000.
The Retail Lease provides for monthly rent that is split into two
components, including (i) the thrift store operations, with
monthly rent starting at $839 and (ii) the depot operations, with
monthly rent starting at $391, both escalating annually at 5%
through the end of the 60-month term.
Accordingly, the total base monthly rent for the full 60-month
term for both the thrift store operations and the depot
operations, if the Debtors do not terminate either or both
components of the Retail Lease, is $81,631.
The Proposed Sale
J. Eric Ivester, Esq., at Skadden Arps Slate Meagher & Flom LLP,
in Chicago, Illinois, relates that the Debtors engaged the
assistance of Alvarez & Marsal Real Estate Advisory Services,
LLC, in marketing the Properties, and determined that the
proposed sale agreement with Mr. Eshaghian, as the stalking horse
bidder, represents the best offer for the Properties.
Pursuant to the proposed sale agreement, Mr. Eshaghian will
purchase the Properties for $4,000,000, subject to, among other
things, higher and better offers, the Restrictive Covenant, the
Leases, and the Court's approval, Mr. Ivester says.
Mr. Eshaghian will make an escrow deposit of $400,000 to the
Debtors, which deposit will be held by the escrow agent until all
conditions to closing are satisfied by the Debtors.
According to Mr. Ivester, the sale of the Properties to Mr.
Eshaghian will include all of the Debtors' right, title and
interest in the Properties. Any personal properties that are
not sold or otherwise removed from the Bakery and Retail
Properties prior to expiration of the Leases will be deemed
abandoned to Mr. Eshaghian when the Leases expire.
The closing will occur within five days of the Court's approval
of the Proposed Sale Agreement, subject to Mr. Eshaghian's full
payment.
At or prior to the Closing, the Debtors will execute a document
that will prohibit Mr. Eshaghian or any other party from using
the Property as a Commercial Bakery for the period of 60
consecutive months after the Closing Date. The Restrictive
Covenant will be recorded in the real property records of Los
Angeles County in California, prior to the recording of the deed
to Mr. Eshagian.
Mr. Eshagian grants the Debtors the option to lease the Bakery
and Retail Leases for up to six months. The Debtors may opt to
terminate the Bakery Lease upon 30 days prior notice, and the
Retail Lease, upon 60 days.
A full-text copy of the proposed Sale Agreement is available for
free at:
http://bankrupt.com/misc/IBCCalifProperties_ProposedSaleAgreement.
pdf
Bidding Procedures
According to Mr. Ivester, the Debtors will continue to solicit
bids which are higher or otherwise better than the offer
submitted by Mr. Eshagian.
Pursuant to proposed bidding procedures, potential bidders should
deliver to the Debtors, among other things, an executed
confidentiality agreement with the Debtors, current audited
financial statements, a preliminary and non-binding proposal.
Potential bidders must make a minimum bid of $4,150,000.
A "qualified bidder" is a Potential Bidder whose financial
information demonstrates the financial capability to consummate
the Sale, and submits a bona fide offer.
The Debtors will provide Mr. Eshagian (i) bid protection in the
form of a termination fee equal to $60,000, to induce him to make
the first qualified bid, and (ii) reasonable and documented
expense reimbursement of up to $25,000.
The key dates of the Proposed Sale are:
August 15, 2008 -- Auction
August 18, 2008 -- Filing of auction results with the Court
-- Deadline for objections to the conduct
of Auction
August 20, 2008 -- Sale Hearing
Pursuant to Rules 2002(l) and 2002(d) of the Federal Rules of
Bankruptcy Procedure, the Debtors will publish notices and
advertisements of sale in The Los Angeles Times prior to the Bid
Deadline.
The Debtors also request that the Property be transferred to the
Successful Bidder free and clear of all liens, claims and
encumbrances.
Furthermore, the Debtors submit that any agreement reached with
the Successful Bidder pursuant to the Bidding Procedures is a
result of arm's-length negotiations, entitling the Successful
Bidder to the protections of Section 363(m) of the Bankruptcy
Code.
A full-text copy of the Bidding Procedures is available at no
charge at:
http://bankrupt.com/misc/IBCCalifProperties_ProposedBiddingProcedu
res.pdf
A summary of the Sale Process is available for free at:
http://bankrupt.com/misc/IBCCalifProperties_SaleProcessSummary.pdf
About IBC
Headquartered in Kansas City, Missouri, Interstate Bakeries
Corporation is a wholesale baker and distributor of fresh-baked
bread and sweet goods, under various national brand names,
including Wonder(R), Baker's Inn(R), Merita(R), Hostess(R) and
Drake's(R). Currently, IBC employs more than 25,000 people and
operates 45 bakeries, as well as approximately 800 distribution
centers and approximately 800 bakery outlets throughout the
country.
The company and eight of its subsidiaries and affiliates filed for
chapter 11 protection on Sept. 22, 2004 (Bankr. W.D. Mo. Case No.
04-45814). J. Eric Ivester, Esq., and Samuel S. Ory, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors
in their restructuring efforts. When the Debtors filed for
protection from their creditors, they listed $1,626,425,000 in
total assets and $1,321,713,000 (excluding the $100,000,000 issue
of 6% senior subordinated convertible notes due Aug. 15, 2014) in
total debts. The Debtors' filed their Chapter 11 Plan and
Disclosure Statement on Nov. 5, 2007. Their exclusive period to
file a chapter 11 plan expired on November 8. On Jan. 25, 2008,
the Debtors filed their First Amended Plan and Disclosure
Statement. On Jan. 30, 2008, the Debtors received Court approval
of the First Amended Disclosure Statement.
IBC confirmed that it has not received any qualifying alternative
proposals for funding its plan of reorganization in accordance
with the Court-approved alternative proposal procedures. As a
result, no auction was held on Jan. 22, 2008, as would have been
required under those procedures. The deadline for submission of
alternative proposals was Jan. 15, 2008. A new plan filing
deadline was set for June 30, 2008; no plan was filed as of that
date.
(Interstate Bakeries Bankruptcy News, Issue No. 104; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000).
IRVINE SENSORS: Board Appoints John Carson as Chairman
------------------------------------------------------
Irvine Sensors Corporation reports that John C. Carson, the
company's Chief Executive Officer and a director, has been
appointed by its Board to also serve as Chairman of the Board.
Mr. Carson succeeds Dr. Mel Brashears who has resigned due to
family medical emergencies.
"Mel has provided valuable service to Irvine Sensors and its
stockholders during his tenure as chairman. We all wish he could
continue in that role, but we understand the priority he must have
in the months ahead", Mr. Carson said.
"He and his family have all of our best wishes", Mr. Carson added.
Based in Costa Mesa, California, Irvine Sensors Corporation
(Nasdaq: IRSN) -- http://www.irvine-sensors.com/-- is a vision
systems company engaged in the development and sale of
miniaturized infrared and electro-optical cameras, image
processors and stacked chip assemblies, the manufacture and sale
of optical systems and equipment for military applications through
its Optex subsidiary and research and development related to high
density electronics, miniaturized sensors, optical interconnection
technology, high speed network security, image processing and low-
power analog and mixed-signal integrated circuits for diverse
systems applications.
Going Concern Doubt
Grant Thornton LLP expressed substantial doubt about Irvine
Sensors Corp.'s ability to continue as a going concern after
auditing the company's financial statements for the year ended
Sept. 30, 2007.
The auditing firm reported that the company incurred net losses
for the years ended Sept. 30, 2007, Oct. 1, 2006 and Oct. 2, 2005,
respectively, and the company has working capital of only
$1,799,100 at Sept. 30, 2007.
IXI MOBILE: Board Starts Strategic Measures to Cut Operating Costs
------------------------------------------------------------------
IXI Mobile, Inc., the maker of the Ogo(TM) family of mobile
devices and services, disclosed that its board of directors has
resolved to initiate several strategic measures intended to
refocus the company's activities and to reduce operating costs.
In recent months the company has actively pursued a relationship
with a major U.S.-based cellular operator but has not been able to
conclude a transaction. As a result, IXI Mobile intends to focus
on the European and Asia Pacific markets and to expand its
cooperation with existing and potential customers in these
territories.
In parallel the company will seek additional investments to meet
its working capital needs. Additionally, the company continues to
pursue strategic partnerships.
The Board of Directors is also implementing cost reduction
measures, including a reduction of approximately 25% of its
headcount and is closing its US facilities, in order to reduce
operating expenses.
The company's Board has also appointed Mr. Israel Frieder CEO.
Messrs. Gideon Barak and Amit Haller who served as Executive Co-
Chairman and CEO respectively, will continue to serve as board
members.
Mr. Frieder, chairman and CEO said: "The Board of Directors
decided to focus on expanding its cooperation with current
customers and potential new customers in Europe and Asia Pacific,
where we have loyal customers such as Swisscom in Switzerland,
Vodafone and 1&1 in Germany and Far EasTone in Taiwan."
"We believe that focusing in known territories where the company's
products have been recognized for a considerable time, will allow
IXI to expand its customer base and continue its growth in these
markets. In parallel the company will explore other opportunities
including strategic partnerships", Mr. Frieder added.
About IXI Mobile
Headquartered in Belmont, California, IXI Mobile Inc. (OTC BB:
IXMO.0B) -- http://www.ixi.com/-- provides devices and hosted
services to mobile operators, mobile virtual network operators,
and Internet service providers in a number of international
markets.
* * *
As reported in the Troubled Company Reporter on July 16, 2008, the
company's consolidated balance sheet at March 31, 2008, showed
total assets of $34,728,000, and total liabilities of $35,314,000,
resulting in a $586,000 stockholders' deficit.
JDA SOFTWARE: Inks $346 Million Merger Deal with i2 Technologies
----------------------------------------------------------------
JDA(R) Software Group Inc. and i2 Technologies Inc. signed a
definitive merger agreement for JDA Software to acquire i2
Technologies Inc., a provider of supply chain solutions, for an
enterprise value of approximately $346 million in cash.
Under the terms of the merger agreement, each issued and
outstanding share of i2's common stock will be converted into the
right to receive $14.86 per share in cash and each issued and
outstanding share of i2's Series B Convertible Preferred Stock
will be converted into the right to receive $1,095.3679 per share
in cash plus all accrued and unpaid dividends. In addition, upon
consummation of the Merger the vesting of each outstanding option
and restricted stock award for common stock of i2 will accelerate
in full and the holders of such equity awards will be entitled to
receive $14.86 per share less the exercise price of such equity
awards, if any.
Direct costs of the acquisition are currently estimated to be
$45 million and include OID and debt issuance costs, investment
banker fees, legal costs and change-in-control payments.
Consummation of the Merger, which is expected to close in fourth
quarter 2008, is subject to several closing conditions, including
the approval and adoption of the merger agreement by i2's
stockholders, the amendment of i2's convertible note indenture,
expiration or termination of the applicable Hart-Scott-Rodino
waiting periods and regulatory and other customary conditions. It
will also be necessary to complete JDA's debt financing
arrangements prior to completing the proposed Merger. There can
be no assurance that the Merger will be consummated. If i2 or JDA
terminates the transaction under certain circumstances, i2 will be
required to pay JDA a non-refundable termination fee of $15
million or JDA will be required to pay i2 a non-refundable
termination fee of $20 million.
According to JDA chief executive officer Hamish Brewer, the i2
acquisition completes the picture for JDA in the supply chain
planning and optimization market.
"By acquiring i2 we double our addressable market in manufacturing
to include discrete manufacturing, complementing our current
market leadership in process manufacturing and strengthening our
retail and transportation management presence," Mr. Brewer
commented. "A major player in the supply chain space for more
than 20 years, i2's world-class customers and employees are the
perfect match for JDA. With the experience gained from the
successful acquisition of Manugistics in 2006, the addition of i2
is comparatively an incremental and logical step for JDA. We are
confident in our abilities to execute and deliver on projected
synergies creating significant incremental shareholder value."
"In an industry that continues to consolidate, scale matters,"
Dr. Pallab Chatterjee, i2 chief executive officer, commented. "In
that regard, the combination of these two companies will create
one of the world's strongest, best-of-breed software solution
providers focused on the supply chain. The combination of i2 and
JDA increases the opportunity for expanded expertise, accelerated
innovation and even greater value delivery through the joining of
some of the best solutions and brightest minds in the industry."
Snapshot of Combined Company
By combining JDA and i2, the resulting company will have
significantly improved operating leverage and a strong financial
position. The near-term cost synergies identified in operations,
general, administrative and infrastructure resulting from this
combination are expected to produce annual cost savings of
approximately $20 million. As a result of the pending Merger, i2
is withdrawing its provided outlook for third quarter 2008.
"In order to avoid equity dilution and maximize our shareholder
value, JDA will finance the acquisition using debt," commented
Kristen Magnuson, JDA's Executive Vice President and Chief
Financial Officer. "Credit Suisse and Wachovia will be financing
the deal. Consistent with our strategy after the Manugistics
acquisition, we will use our significantly expanded cash flow from
operations to de-lever as quickly as possible."
Debt Financing Arrangements
Concurrent with the execution of the merger agreement, JDA
received commitments from Credit Suisse and Credit Suisse
Securities (USA) LLC, Wachovia Bank, National Association and
Wachovia Capital Markets LLC to provide up to $450 million of debt
financing to complete the i2 acquisition, including $425 million
in term loans and a $25 million revolving credit facility on
customary terms and conditions.
JDA will use the debt financing, net of issuance costs, together
with the companies' combined cash balances at closing, to fund the
cash obligations under the merger agreement and related
transaction expenses, to repay i2's convertible debt, to refinance
JDA's existing debt and revolving credit facilities and to provide
cash for the combined companies' ongoing working capital and
general corporate needs.
Voting Agreements
JDA has entered into voting agreements with certain directors and
executive officers of i2 and with a significant stockholder of i2,
pursuant to which such signatories have agreed to vote in favor of
the Merger agreement and against any other proposal or offer to
acquire i2. The voting agreements apply to all shares of i2
common stock and Series B Convertible Preferred Stock held by the
signatories at the record date for the relevant i2 stockholder
meeting. The voting agreements restrict the transfer of shares by
the signatories, except under certain limited conditions.
Consent and Conversion Agreements
Concurrent with the execution of the merger agreement, i2 entered
into a Consent and Conversion Agreement with Highbridge
International LLC as the holder of a majority or more of its
outstanding 5% Senior Convertible Notes due 2015. In return for
i2's agreement to pay Highbridge a payment of $86.9565 per $1,000
principal amount of Notes, Highbridge has agreed as of the
effective time of the Merger, to waive the application of and
amend the indenture for the Notes to remove certain covenants and
further to convert the Notes at, or within 30 trading days of, the
effective time of the merger into cash as provided in the
indenture, together with a make whole premium, as provided in the
indenture as well as interest through the date of conversion.
One-third of the Consent Premium due to Highbridge will be paid by
i2 prior to Aug. 13, 2008, with such amount being non-refundable,
and the balance will be payable at the effective time of the
Merger. Pursuant to the Conversion Agreement, Highbridge also
agreed to convey its warrants to i2 as of the effective time of
the Merger pursuant to the terms of the warrant agreement. The
merger agreement obligates i2 to offer similar arrangements to all
holders of the Notes to be effective as of the effective time of
the Merger.
Consent Agreement with Thoma Cressey Bravo Funds
Concurrent with the execution of the Merger Agreement, the company
also entered into a Consent and Agreement with Thoma Cressey Bravo
Funds, as the holders of its Series B Convertible Preferred Stock
to among other things, agree to the terms and conditions of a
Certificate of Amendment to the Certificate of Designations for
the Series B Stock to be filed and effective in connection with
the closing of the Merger. The Certificate of Amendment provides
for the accrual of cash dividends payable to the holders of the
Series B Stock at an annual rate of 12% compounding quarterly
during any period after Sept. 6, 2013, if the company is unable to
redeem the Series B Stock as a result of a prohibition under the
debt financing arrangements. This accrued but unpaid Dividend is
payable upon the redemption of the Series B Stock. This
obligation to accrue the Dividend terminates on Sept. 6, 2017,
after which time the company will be unconditionally obligated to
redeem the Series B Stock upon the request of the holders of such
stock.
Citi acted as exclusive financial advisor to JDA and DLA Piper US
LLP acted as JDA's legal counsel. J.P. Morgan Securities Inc.
acted as exclusive financial advisor to i2 and Munsch Hardt Kopf &
Harr, P.C. acted as i2's legal counsel.
About i2 Technologies Inc.
i2 Technologies Inc. -- http://www.i2.com/-- is a full-service
supply chain company that helps clients achieve business results
through a combination of consulting, technology, and managed
services. i2 solutions are pervasive in a cross-section of
industries; 21 of the AMR Research Top 25 Global Supply Chains
belong to i2 customers.
About JDA Software Group Inc.
JDA Software Group Inc. -- http://www.jda.com/-- is focused on
helping companies realize real supply chain and revenue management
results. JDA Software delivers integrated merchandising well as
supply chain and revenue management planning, execution, and
optimization solutions for the consumer-driven supply chain and
services industries.
JDA SOFTWARE: i2 Technologies Buyout Cues Moody's to Retain B1 CFR
------------------------------------------------------------------
Moody's commented that JDA Software's B1 corporate family rating
and stable outlook will likely remain unchanged after the
company's announcement that it will acquire i2 Technologies Inc.,
a supply chain software and solutions provider. The acquisition
is expected to further consolidate JDA's position in the supply
chain software market and enhance its exposure to the discrete
manufacturing verticals such as electronics, high-tech,
automotive, and metals, complementing its existing presence in the
process manufacturing and retail markets. Pro-forma revenues for
the combined company are expected to be $635 million.
The acquisition is expected to be funded with up to $450 million
of debt financing, including $425 million in term loans and a
$25 million revolving credit facility, together with the
companies' combined cash of roughly $269 million to fund the
$346 million purchase price, to repay i2 Technologies' convertible
debt ($225 million), to refinance JDA's existing senior secured
credit facility ($81 million), in addition to various transaction
costs. Moody's estimates that the company's pro-forma leverage, as
defined by the ratio of debt to trailing twelve month EBITDA, will
increase to approximately 3.5x from its current leverage of 1.4x
(Moody's adjusted). The transaction will bring additional
integration risk as the company continues its pace of
acquisitions, following JDA's acquisition of Manugistics in July
2006, but this risk is already largely factored in the B1 rating.
Moody's expects that the management will remain acquisitive and
continue to consolidate in order to gain scale and compete with
larger supply chain vendors such as Oracle and SAP.
Headquartered in Scottsdale, Arizona, JDA Software Group Inc. is a
supplier of enterprise supply chain management and optimization
software for the manufacturing, wholesale distribution, retail and
service industries. The company reported revenues and EBITDA
(Moody's adjusted) for the last twelve months ended June 30, 2008
of approximately $378 million and $101 million.
JOHNSTON SHIELD: Wants to Employ Ryan Rapp as Bankruptcy Counsel
----------------------------------------------------------------
Johnston Shield, Inc. and its debtor-affiliate ask authority from
the U.S. Bankruptcy Court for the District of Arizona to employ
Ryan Rapp & Underwood, P.L.C. as its bankruptcy counsel.
Ryan Rapp will, among others, give the Debtor legal advice with
respect to Debtor's powers and duties in the continued operation
of its business and management of its property.
The Debtor tells the Court that the firm's professionals will bill
the Debtor these hourly rates:
Franklin D. Dodge $325
Timothy C. Dietz $295
Terrie S. Rendler $285
Sandra Portney $285
Polly Rapp $285
Paralegals $105 - $125
The Debtor assures the Court that the firm does not represent any
interest adverse to the Debtor.
Phoenix, Arizona-based Johnston Shield, Inc., and debtor-
affiliate, Johnston-Shield Properties, LLC, filed for Chapter 11
protection on July 10, 2008 (Bankr. D. Ariz. Case No. 08-08474).
Franklin D. Dodge, Esq. represents the Debtor in its restructuring
efforts. When the Debtor filed for protection from its creditors,
it listed estimated assets and debts of $1 million to
$100 million.
LINENS N THINGS: JG Resources Sells LNT'S Fixtures at a Discount
----------------------------------------------------------------
"Don't think that the closing of 79 Linens-N-Things stores in 18
states is bad news for retailers. Instead, it will have a
positive effect on the local retail industry," according to Jim
Grimwade, CEO of JG Resources, a national asset liquidation
company headquartered in Grand Rapids, Michigan. JG Resources is
conducting store fixture liquidation sales at 79 selected Linens-
N-Thing stores in 18 states. Fixture liquidations are in progress
at these 79 selected locations only.
"Reselling these fixtures and equipment to other retailers
and business owners who are expanding or remodeling gives me a
positive outlook," says Mr. Grimwade. "Of course, we are truly
sorry about these store closings, but we know that selling this
equipment to other business owners at a FRACTION of the cost of
new will help fuel the local economy's growth. It could also help
retailers create NEW jobs by cutting costs from their bottom
line," Mr. Grimwade adds.
Mr. Grimwade says that he is eager to inform consumers about the
79 Linens-N-Things store fixture liquidations to all area
businesses, adding, "This total liquidation is a fantastic
opportunity for business owners and the general public to save
significantly on commercial fixtures, including Display Shelving,
Shopping Carts, Stock Room Shelving, Dump Bins, Pallet Rack,
Check-out Counters, Telephone Systems, Cash Safes, Pallet Jacks,
Merchandise Displays, Cash Registers, and more."
Mr. Grimwade says that JG Resources has liquidated assets,
fixtures, and more, from hundreds of big box chains, warehouses,
supermarkets, corporate offices and Fortune 500 companies as solo
projects and in several joint venture partnerships. According to
Mr. Grimwade, business owners and the general public have been
saving money by buying business fixtures and other liquidation
assets from his liquidation projects for over 25 years.
Mr. Grimwade says that he is inviting business owners and the
general public to shop and save now during the store fixture
liquidation at these 79 selected Linens-N-Things locations only.
Sale hours are 10am-7pm Monday-Saturday and 11am-4pm Sunday.
View all store locations, photos and more at
http://www.JGResource.com/LNT.html
Clifton, New Jersey-based Linens 'n Things, Inc. --
http://www.lnt.com/-- is the second largest specialty retailer
of home textiles, housewares and home accessories in North America
operating 589 stores in 47 U.S. states and seven Canadian
provinces as of Dec. 29, 2007. The company is a destination
retailer, offering one of the broadest and deepest selections of
high quality brand-name as well as private label home furnishings
merchandise in the industry. Linens 'n Things has some 585
superstores (33,000 sq. ft. and larger), emphasizing low-priced,
brand-name merchandise, in more than 45 states and about seven
Canadian provinces. Brands include Braun, Krups, Calphalon,
Laura Ashley, Croscill, Waverly, and the company's own label.
Linens 'n Things was acquired by private equity firm Apollo
Management in 2006.
On May 2, 2008, these Linens entities filed chapter 11 petition
(Bankr. D. Del.): Linens Holding Co. (08-10832), Linens 'n Things,
Inc. (08-10833), Linens 'n Things Center, Inc. (08-10834),
Bloomington, MN., L.T., Inc. (08-10835), Vendor Finance, LLC (08-
10836), LNT, Inc. (08-10837), LNT Services, Inc. (08-10838), LNT
Leasing II, LLC (08-10839), LNT West, Inc. (08-10840), LNT
Virginia LLC (08-10841), LNT Merchandising Company LLC (08-10842),
LNT Leasing III, LLC (08-10843), and Citadel LNT, LLC (08-10844).
Judge Christopher S. Sontchi presides over the case.
The Debtors' bankruptcy counsels are Mark D. Collins, Esq., John
H. Knight, Esq., Michael J. Merchant, Esq., and Jason M. Madron,
Esq., at Richards, Layton & Finger, P.A. The Debtor's special
corporate counsels are Holland N. O'Neil, Esq., Ronald M.
Gaswirth, Esq., Stephen A. McCartin, Esq., Randall G. Ray, Esq.,
and Michael S. Haynes, Esq., at Gardere Wynne Sewell LLP; and
Howard S. Beltzer, Esq., and Wendy S. Walker, Esq., at Morgan,
Lewis & Bockius LLP. The Debtors' restructuring management
services provider is Conway, Del Genio, Gries & Co., LLC. The
Debtors' CRO/Interim CEO is Michael F. Gries, co-founder of
Conway Del Genio Gries & Co., LLC. The Debtors' claims agent is
Kurtzman Carson Consultants LLC. The Debtors' consultants are
Asset Disposition Advisors, LLC, and Protiviti, Inc. Their
investment bankers are Financo, Inc. and Genuity Capital Markets.
The Official Committee of Unsecured Creditors is represented by
Scott L. Hazan, Esq., and Glenn Rice, at Otterbourg Steindler
Houston & Rosen P.C., as lead counsel. Norman L. Pernick, Esq.,
at Cole, Schotz, Meisel, Forman & Leonard, P.A., in Wilmington,
Delaware, serves as local co-counsel. Carl Marks Advisory Group
LLC serves as financial advisor to the Creditors' Committee. A
Noteholder Committee has been formed and is represented by
Kasowitz, Benson, Torres & Friedman LLP, and Pachulski Stang Ziehl
& Jones.
(Bankruptcy News About Linens 'n Things, Issue No. 14; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000)
LINENS N THINGS: 2nd Qtr. Sales Down 21%; 10-Q Report Delayed
-------------------------------------------------------------
Linens Holding Co., a leading home furnishings specialty retailer
known as "Linens 'n Things," reported its sales results for the
second quarter ended June 28, 2008. The Company reported total
sales of $504.0 million for the quarter. Net retail sales of
$468.1 million for the quarter represented a 21.1% decrease over
the same period in 2007. Total net retail sales for the quarter
does not include $35.9 million in liquidation sales in accordance
with the previously announced closing of 120 stores in the second
quarter. The decrease in second quarter net retail sales
resulted from a comparable store sales decline of 18.3% for the
period and the net reduction of 105 stores from the prior year.
Due to its recent Chapter 11 bankruptcy filing, the Company
requires additional time to complete the preparation of its
consolidated financial statements for the second quarter of 2008.
The delay is necessary in part because, in connection with the
Company's bankruptcy filing, the Company is performing an
impairment analysis related to certain of its tangible and
intangible assets, which is not yet complete. As a result, the
Company has not finalized its quarterly financial statements on
its customary schedule and will not file its Form 10-Q with the
Securities and Exchange Commission today. The Company intends to
finalize the financial statements and file the report as soon as
reasonably practicable. In addition, due to these factors, the
Company will not hold a second quarter 2008 investor earnings
conference call.
The Company ended the quarter with an asset-based revolver
balance of $200.9 million (excluding outstanding letters of
credit totaling $63.3 million), cash on hand of $42.7 million and
excess availability under its revolving credit facility of $176.7
million. Outstanding letters of credit does not reflect the
letter of credit issued in July in support of the Company's
Enhanced Trade Credit Program, which was approved on July 10,
2008. As of the close of business on August 10th, the Company
had excess availability under its revolving credit facility of
$74.2 million, which has been reduced by the $75.0 million letter
of credit issued in support of its Enhanced Trade Credit Program.
During the second quarter of 2008, the Company opened two
stores and closed 120 stores as compared with opening seven
stores and closing zero stores during the second quarter of 2007.
Store square footage decreased 19.1% to 15.5 million at June 28,
2008 compared with 19.2 million at June 30, 2007.
The Company reported total sales of $1,070.9 million for the
26 week period ended June 28, 2008. Net retail sales of $1,035.1
million for the 26 period represented an 11.2% decrease over the
same period in 2007. Total net retail sales for the 26 weeks
ended June 28, 2008 does not include $35.9 million in liquidation
sales in accordance with the previously announced closing of 120
stores in the second quarter. Comparable store net retail sales
for the 26 period ended June 28, 2008 decreased 11.8%.
Linens 'n Things, with 2007 sales of approximately $2.8
billion, is one of the leading, national large format retailers
of home textiles, housewares and home accessories. As of June
28, 2008, Linens 'n Things operated 475 stores in 46 states and
seven provinces across the United States and Canada. More
information about Linens 'n Things can be found online at
http://www.lnt.com/
Rival to Benefit if Closings Continue
BusinessWeek reports that Deutsche Bank analyst Mike Baker told
investors that retailer Bed Bath & Beyond Inc. is poised to gain
additional benefits if Linens 'n Things continues to close
stores. Linens has said its sales fell partly because it was
operating 105 fewer stores during its quarter ended June 28,
2008, and has announced closings of 80 additional stores.
According to the report, Mr. Baker said in research note that
Union, New Jersey-based Bed Bath should pick up a 30% share from
any closed Linens 'n Things stores.
UBS Securities analyst Brian Nagel gave a similar note to
investors last week, saying Bed Bath is expected to gain market
share as a result of the closures. "We estimate that of the 177
units Linens 'n Things plans to close, 140 operate within five
miles of a Bed Bath & Beyond store," Mr. Nagel wrote.
Reuters noted that Bed Bath reported better-than-expected
earnings last June. Bed Bath said net sales for quarter ended
May 31, 2008, were approximately $1,648,000,000, an increase of
approximately 6.1% from net sales of $1,553,000,000 reported in
the fiscal first quarter of 2007. It booked net earnings of
$76,800,000 ($0.30 per diluted share) in the fiscal first quarter
ended May 31, 2008, compared with net earnings of $104,600,000
($0.38 per diluted share) in the same quarter a year ago.
Clifton, New Jersey-based Linens 'n Things, Inc. --
http://www.lnt.com/-- is the second largest specialty retailer
of home textiles, housewares and home accessories in North America
operating 589 stores in 47 U.S. states and seven Canadian
provinces as of Dec. 29, 2007. The company is a destination
retailer, offering one of the broadest and deepest selections of
high quality brand-name as well as private label home furnishings
merchandise in the industry. Linens 'n Things has some 585
superstores (33,000 sq. ft. and larger), emphasizing low-priced,
brand-name merchandise, in more than 45 states and about seven
Canadian provinces. Brands include Braun, Krups, Calphalon,
Laura Ashley, Croscill, Waverly, and the company's own label.
Linens 'n Things was acquired by private equity firm Apollo
Management in 2006.
On May 2, 2008, these Linens entities filed chapter 11 petition
(Bankr. D. Del.): Linens Holding Co. (08-10832), Linens 'n Things,
Inc. (08-10833), Linens 'n Things Center, Inc. (08-10834),
Bloomington, MN., L.T., Inc. (08-10835), Vendor Finance, LLC (08-
10836), LNT, Inc. (08-10837), LNT Services, Inc. (08-10838), LNT
Leasing II, LLC (08-10839), LNT West, Inc. (08-10840), LNT
Virginia LLC (08-10841), LNT Merchandising Company LLC (08-10842),
LNT Leasing III, LLC (08-10843), and Citadel LNT, LLC (08-10844).
Judge Christopher S. Sontchi presides over the case.
The Debtors' bankruptcy counsels are Mark D. Collins, Esq., John
H. Knight, Esq., Michael J. Merchant, Esq., and Jason M. Madron,
Esq., at Richards, Layton & Finger, P.A. The Debtor's special
corporate counsels are Holland N. O'Neil, Esq., Ronald M.
Gaswirth, Esq., Stephen A. McCartin, Esq., Randall G. Ray, Esq.,
and Michael S. Haynes, Esq., at Gardere Wynne Sewell LLP; and
Howard S. Beltzer, Esq., and Wendy S. Walker, Esq., at Morgan,
Lewis & Bockius LLP. The Debtors' restructuring management
services provider is Conway, Del Genio, Gries & Co., LLC. The
Debtors' CRO/Interim CEO is Michael F. Gries, co-founder of
Conway Del Genio Gries & Co., LLC. The Debtors' claims agent is
Kurtzman Carson Consultants LLC. The Debtors' consultants are
Asset Disposition Advisors, LLC, and Protiviti, Inc. Their
investment bankers are Financo, Inc. and Genuity Capital Markets.
The Official Committee of Unsecured Creditors is represented by
Scott L. Hazan, Esq., and Glenn Rice, at Otterbourg Steindler
Houston & Rosen P.C., as lead counsel. Norman L. Pernick, Esq.,
at Cole, Schotz, Meisel, Forman & Leonard, P.A., in Wilmington,
Delaware, serves as local co-counsel. Carl Marks Advisory Group
LLC serves as financial advisor to the Creditors' Committee. A
Noteholder Committee has been formed and is represented by
Kasowitz, Benson, Torres & Friedman LLP, and Pachulski Stang Ziehl
& Jones.
(Bankruptcy News About Linens 'n Things, Issue No. 15; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000)
LINENS N THINGS: Injured Store Invitee Seeks to Sue for Damages
---------------------------------------------------------------
Barbara Weaver asks the United States Bankruptcy Court for the
District of Delaware to lift the automatic stay on the Chapter 11
bankrupty cases of Linens 'n Things and its debtor-affiliates so
that she may proceed with her personal injury action against the
Debtors for purposes of liquidating her claim, and enforcing and
collecting any potential settlement or judgment from any available
insurance.
In April 2007, Ms. Weaver filed a civil action against LNT, Inc.,
in the Judicial District of New London in the Connecticut Superior
Court. In the State Court Action, Ms. Weaver alleges that she was
a business invitee at a Linens 'N Things store at 915 C2 Hartford
Turnpike, in Waterford, Connecticut, when a shelf collapsed
causing several boxes to fall towards her, and caused her to
sustain:
-- cervical strain;
-- thoracic strain;
-- disc herniation;
-- neck pain, which radiates into her shoulder pain;
-- trapezius muscle spasm;
-- a severe shock to her nervous system;
-- medical damages; and
-- expenses for housecleaning chores that she is no longer
able to perform.
Through the State Court Action, Ms. Weaver is seeking money
damages and costs. She informs the Court that damages and costs
sought are covered by an insurance policy issued to LNT, Inc., by
Zurich American Insurance Company in the amount of $500,000.
Ms. Weaver submits that allowing her to pursue her claim against
the Debtor's insurance policy will inflict no prejudice on the
Debtors or the bankruptcy estates because she is only seeking to
recover from applicable insurance. She adds that there is a good
probability of her obtaining a settlement with, or judgment
against the Debtors, which will allow her to recover the insurance
proceeds.
Clifton, New Jersey-based Linens 'n Things, Inc. --
http://www.lnt.com/-- is the second largest specialty retailer
of home textiles, housewares and home accessories in North America
operating 589 stores in 47 U.S. states and seven Canadian
provinces as of Dec. 29, 2007. The company is a destination
retailer, offering one of the broadest and deepest selections of
high quality brand-name as well as private label home furnishings
merchandise in the industry. Linens 'n Things has some 585
superstores (33,000 sq. ft. and larger), emphasizing low-priced,
brand-name merchandise, in more than 45 states and about seven
Canadian provinces. Brands include Braun, Krups, Calphalon,
Laura Ashley, Croscill, Waverly, and the company's own label.
Linens 'n Things was acquired by private equity firm Apollo
Management in 2006.
On May 2, 2008, these Linens entities filed chapter 11 petition
(Bankr. D. Del.): Linens Holding Co. (08-10832), Linens 'n Things,
Inc. (08-10833), Linens 'n Things Center, Inc. (08-10834),
Bloomington, MN., L.T., Inc. (08-10835), Vendor Finance, LLC (08-
10836), LNT, Inc. (08-10837), LNT Services, Inc. (08-10838), LNT
Leasing II, LLC (08-10839), LNT West, Inc. (08-10840), LNT
Virginia LLC (08-10841), LNT Merchandising Company LLC (08-10842),
LNT Leasing III, LLC (08-10843), and Citadel LNT, LLC (08-10844).
Judge Christopher S. Sontchi presides over the case.
The Debtors' bankruptcy counsels are Mark D. Collins, Esq., John
H. Knight, Esq., Michael J. Merchant, Esq., and Jason M. Madron,
Esq., at Richards, Layton & Finger, P.A. The Debtor's special
corporate counsels are Holland N. O'Neil, Esq., Ronald M.
Gaswirth, Esq., Stephen A. McCartin, Esq., Randall G. Ray, Esq.,
and Michael S. Haynes, Esq., at Gardere Wynne Sewell LLP; and
Howard S. Beltzer, Esq., and Wendy S. Walker, Esq., at Morgan,
Lewis & Bockius LLP. The Debtors' restructuring management
services provider is Conway, Del Genio, Gries & Co., LLC. The
Debtors' CRO/Interim CEO is Michael F. Gries, co-founder of
Conway Del Genio Gries & Co., LLC. The Debtors' claims agent is
Kurtzman Carson Consultants LLC. The Debtors' consultants are
Asset Disposition Advisors, LLC, and Protiviti, Inc. Their
investment bankers are Financo, Inc. and Genuity Capital Markets.
The Official Committee of Unsecured Creditors is represented by
Scott L. Hazan, Esq., and Glenn Rice, at Otterbourg Steindler
Houston & Rosen P.C., as lead counsel. Norman L. Pernick, Esq.,
at Cole, Schotz, Meisel, Forman & Leonard, P.A., in Wilmington,
Delaware, serves as local co-counsel. Carl Marks Advisory Group
LLC serves as financial advisor to the Creditors' Committee. A
Noteholder Committee has been formed and is represented by
Kasowitz, Benson, Torres & Friedman LLP, and Pachulski Stang Ziehl
& Jones.
(Bankruptcy News About Linens 'n Things, Issue No. 14; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000)
LONDON FOG: Liquidation Brings in $57.9MM to Pay Secured Lenders
----------------------------------------------------------------
Homestead and Homestead Hospitality are all that remain of the old
London Fog Group after a liquidation of the company, Home Textiles
Today reports. London Fog filed for bankruptcy protection last
March -- the second in five years.
Under the liquidation of the London Fog stores, Pacific Trail
outerwear was sold to competitor Columbia Sportswear for
$20.4 million in April. A deal with Iconix Brand Group brought
another $37.5 million in cash and stock.
The $57.9 million from those two deals will pay down most of the
company's secured debt, according to Home Textiles.
The report says Homestead's portfolio even now includes such
brands and designers as Angela Adams, Collier Campbell, Nancy
Koltes, Dreams by Peacock Alley, Preston Bailey, Jeffrey Bilhuber,
The Art of Home Ann Gish, Cubanitas, MaryJane Butters, and others.
MARIPOSA: DJM Realty to Auction 24 Retail Stores
------------------------------------------------
DJM Realty is handling the chapter 11 bankruptcy auction of 24
retail stores that were operated by Mariposa, a mall-based women's
apparel chain, according to CoStar Group (Md.).
The Mariposa stores are from 1,953 square feet to 5,204 square
feet. Lease rates range from $10.00 to $35.00 per square foot.
Five stores are located in Alaska, three in Idaho, one in Montana,
five in Utah, and eight in Washington.
MIDLAND FOOD: Gets Interim OK to Use FBNA et al.'s Cash Collateral
------------------------------------------------------------------
The Hon. Mary Walrath of the United States Bankruptcy Court for
the District of Delaware authorized Midland Food Services LLC to
use, on an interim basis, the cash collateral of several lenders
including First Bank National Association; Castle Hill Holdings V,
LLC; Castle Hill Holdings VI, LLC; GE Capital Finance Corporation;
and McLane Foodservice Inc.
The Debtor needs at least $5.6 million in cash collateral, the
Deal reports.
The Debtor tells the Court that it has an urgent need to use its
lender's cash collateral to pay:
i) present operating expenses -- including payroll for
management employees on Aug. 8, 2008 and balance of the
employees on Aug. 12, 2008, and
ii) vendors to ensure a continued supply of goods and
services essential to the Debtor's ongoing viability.
Without the access of cash collateral, the Debtor will be unable
to meet its expenses and maintain the operation of its business.
The absence of cash collateral will cause harm to the Debtor's
estate.
Before its bankruptcy filing, the Debtor failed to make payments
of at least $27.5 million to Capmark Finance Inc., as the servicer
for U.S. Bank National Association fka First Bank National
Association who is a trustee for Registered Holders of FMAC Loan
Receivables Truste 1996-B under the terms of a note, which is
secured by liens and security interests in and against
substantially all of the Debtor's assets. In May 2008, the
lender agreed not to declare default until Sept. 2, 2008, under
a forbearance agreement.
Furthermore, the Debtor is presently in default under two non-
residential real property leases with Castle Hill.
As adequate protection, the lenders will be granted replacement
liens in the Debtor's postpetition cash collateral.
A hearing is set for Aug. 25, 2008, at 3:00 p.m., to consider the
Debtor's motion. Objections, if any, are due Aug. 21, 2008.
About Midland Food
Independence, Ohio-based Midland Food Services, L.L.C. is a Pizza
Hut franchisee. Midland Food filed for Chapter 11 bankruptcy
petition before the United States Bankruptcy Court for the
District of Delaware on August 6, 2008 (Bankr. D. Del. 08-11802).
Tara L. Lattomus, Esq., at Eckert Seamans Cherin & Melot, L.L.C.,
represented the Debtor in their restructuring efforts.
The Debtor filed a previous Chapter 11 protection back in October
2000. It emerged from bankruptcy one year later after the Debtor's
plan of reorganization dated Aug. 7, 2001.
When it filed for bankruptcy, it listed estimated assets of
between $50,000 and $10,000,000 and estimated debts of between
$1,000,000 and $10,000,000.
MORTIMER FUNERAL: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Mortimer Funeral Home, Inc.
P.O. Box 1338
Greenville, MS 38702
Bankruptcy Case No.: 08-13239
Type of Business: The Debtor provides funeral services. See
http://www.mortimerfuneralhome.com/
Chapter 11 Petition Date: August 15, 2008
Court: Northern District of Mississippi (Aberdeen)
Debtor's Counsel: A. E. Rusty Harlow, Jr., Esq.
1360 Sunset Dr., Ste. 3
Grenada, MS 38901
Tel: (662) 226-7215
Email: rusty@harlowlawfirm.com
Estimated Assets: Less than $50,000
Estimated Debts: $1,000,000 to $10,000,000
A copy of Mortimer Funeral Home, Inc.'s petition is available for
free at http://bankrupt.com/misc/msnb08-13239.pdf
MT. CLEMENS: Case Summary & 7 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Mt. Clemens Marine Center, Inc.
101 Michigan Street
Mt. Clemens, MI 48043
Bankruptcy Case No.: 08-59833
Chapter 11 Petition Date: August 14, 2008
Court: Eastern District of Michigan (Detroit)
Debtors' Counsel: Richard F. Fellrath
4056 Middlebury Drive
Troy, MI 48085
Tel: (248) 519-5064
Fax: (248) 519-5065
Email: lawfell@wowway.com
Total Assets: $2,250,000
Total Debts: $1,270,736
A copy of Mt. Clemens Marine Center, Inc.'s petition is available
for free at http://bankrupt.com/misc/mieb08-59833.pdf
MTR GAMING: S&P Cuts Rating to 'B-'; Outlook Negative
-----------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
and issue-level ratings on MTR Gaming Group Inc. The corporate
credit rating was lowered to 'B-' from 'B+'. The rating outlook is
negative.
"The ratings downgrade reflects our concern that the company will
violate the financial covenants established in its credit
agreement in the near term, despite having previously amended its
covenants in March 2008," said Standard & Poor's credit analyst
Mike Listner.
MTR Gaming has exhibited revenue and EBITDA growth in the first
half of the year, primarily related to the introduction of table
games at its Chester, W.Va. property, Mountaineer Casino,
Racetrack & Resort. In addition, the company has benefited from a
full six months of operations at its Erie, Pa. racino, Presque
Isle Downs, compared to only four months of operations in the same
period in 2007. Still, our expectation is that EBITDA growth will
be insufficient in the second half of the year to address step-
downs built into the company's leverage covenant.
"Based on the quarter ending June 30, 2008, MTR reported a debt-
to-EBITDA ratio of 6.22x--just slightly less than the 6.25x
covenant requirement. This measure steps down to 5.75x on Sept.
30, 2008 and to 5.25x on Dec. 31, 2008, and includes additional
incremental reductions thereafter. While the company has
demonstrated a commitment to repay debt through principal payments
of approximately $37 million (including both voluntary and
scheduled principal payments) in the first half of the year, there
still exists a need to grow profitability substantially in order
to remain in compliance. We project that consolidated EBITDA would
need to grow approximately 60% on a year-over-year basis in the
second half of the year to prevent a near-term covenant
violation," S&P says.
"With operating conditions across the U.S. gaming industry
challenged by a weak economy, we are concerned about MTR Gaming's
growth prospects. Mountaineer, which contributes more than half of
MTR Gaming's EBITDA, reported $11.7 million of EBITDA for the
second-quarter of 2008--a slight decline from the prior-year
period. Despite the introduction of poker and table games at
Mountaineer, the property has been facing declines in its slot
revenues since the June 2007 opening of The Meadows in
southwestern Pennsylvania, and we do not expect a significant
change in this dynamic given the weak economy. This puts the onus
on Presque Isle Downs to grow significantly in the second half of
2008 for MTR Gaming to avoid a covenant violation.
"Moreover, we expect that Mountaineer will face additional
competition in 2009 from the slot gaming venue to be located in
downtown Pittsburgh. Following the Pennsylvania Gaming Control
Board's recent approval of a change in ownership structure for the
property, we expect the facility to open in the third quarter of
2009. Once completed, we believe that the additional competition
will cause EBITDA to decline at Mountaineer, resulting in weaker
credit measures for MTR Gaming in approximately one year from now.
"The 'B-' rating reflects MTR Gaming's high debt leverage, the
likelihood of a near-term covenant violation, and the ongoing and
additional competitive threats posed by the Pennsylvania gaming
market to the company's largest gaming property (Mountaineer).
These concerns are somewhat tempered by the solid operating
performance at the company's newest property, Presque Isle Downs."
NANOGEN INC: Posts $5.1 Million Net Loss in Quarter Ended June 30
-----------------------------------------------------------------
Nanogen, Inc. reported its unaudited financial results for the
quarter ended June 30, 2008.
The company reported a net loss of $5.1 million for the quarter
ended June 30, 2008, compared to a net loss of $14.6 million for
the same period last year.
Total revenues for the second quarter of 2008 grew 21% to
$12.9 million, as compared to $10.7 million recorded in the first
quarter of 2008, and increased more than 25% from the
$10.3 million reported for the second quarter of 2007. Product
revenues for the second quarter of 2008 were approximately
$8.0 million, down slightly from the $8.1 million for the first
quarter of 2008, but up 51% over product revenues of $5.3 million
recorded in the second quarter of 2007.
Costs and expenses, including cost of sales, decreased in the
second quarter of 2008 by almost 20% to $19.3 million from
$24.1 million in the second quarter of 2007, and increased
slightly from the $18.7 million recorded in the first quarter of
2008. The current quarter included $1.1 million in charges
directly related to the decision to consolidate point of care
manufacturing operations into one location with no comparable
charge in the prior quarter.
For the quarter ended June 30, 2008, Nanogen's Modified EBITDA,
its internal management measure of performance, was negative
$2.8 million for the second quarter of 2008, an improvement of 51%
as compared to negative $5.7 million in the first quarter of 2008,
and an improvement of 59% as compared to negative $6.9 million in
the second quarter of 2007. The second quarter of 2008 loss from
operations improved by 21% to $6.3 million from a loss of
$8.0 million in the first quarter of 2008, and improved by 54% as
compared to a loss of $13.8 million in the second quarter in 2007.
"Our operating performance in the second quarter was greatly
improved, continuing the positive trend we have shown each quarter
since our restructuring," Howard C. Birndorf, Nanogen's chairman
of the board and CEO, said. "We are clearly realizing the
anticipated benefits of the significant business restructuring we
initiated last year."
Financial Guidance for 2008
Nanogen's 2008 guidance is unchanged. The company expects total
2008 revenues to increase by approximately 25% from 2007 levels
with a gross margin of approximately 60%. The anticipated growth
in revenues, combined with improved gross margins and substantial
operating expense reductions, should allow the company to achieve
operating cash flow breakeven by the end of 2008 as measured by
Modified EBITDA.
Balance Sheet
At June 30, 2008, the company's balance sheet showed total assets
of $94.9 million and total liabilities of $79.9 million, resulting
in a stockholders' equity of $15.0 million. Equity, at Dec. 31,
2007, was $41.5 million.
About Nanogen Inc.
San Diego, California-based Nanogen Inc. (NASDAQ: NGEN) --
http://www.nanogen.com/-- provides advanced diagnostic products.
As of March 16, 2007, the company was developing several product
lines that directly target specific markets within the advanced
diagnostics field. Its diagnostic technologies focus on the
identification of the nucleic acid sequences, gene variations and
gene expressions associated with both genetic conditions and
infectious diseases. Nanogen has four categories of advanced
diagnostic technologies: molecular testing platforms molecular
reagents point-of-care tests and advanced genetic markers. On
Feb. 6, 2006, Nanogen acquired the rapid cardiac immunoassay
point-of-care test business of Spectral Diagnostics Inc. The
acquired products include rapid tests for levels of CKMB,
Myoglobin and Troponin, all of which are frequently used in
cardiac care. On May 1, 2006, it completed the acquisition of the
diagnostics division of Amplimedical S.P.A.
Going Concern Doubt
Ernst & Young LLP, in San Diego, California, expressed substantial
doubt about Nanogen Inc.'s ability to continue as a going concern
after it audited the company's consolidated financial statements
ended Dec. 31, 2007 and 2006 (restated). The auditing firm
pointed to the company's recurring operating losses, working
capital deficit and accumulated deficit of $400.6 million as of
Dec. 31, 2007.
NASHVILLE SENIOR: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Lead Debtor: Nashville Senior Living, LLC
8118-B Sawyer Brown Road
Nashville, TN 37221
Bankruptcy Case No. 08-07254
Debtor-affiliates filing separate Chapter 11 petitions:
Entity Case No.
------ --------
Anderson Senior Living Property, LLC 08-07255
aka
Anderson Senior Living Operator, LLC
3501 North Highway 81
Anderson, SC 29621
Charlotte Oakdale Property, LLC 08-07256
11230 Ballantyne Trace Court
Charlotte, NC 28277
Greensboro Oakdale Property, LLC 08-07257
3896 North Elm Street
Greensboro, NC 27455
Mt. Pleasant Oakdale I Property, LLC 08-07258
1010 Anna Knapp Blvd.
Mt. Pleasant, SC 29464
Mt. Pleasant Oakdale II Property, LLC 08-07259
601 Mathis Ferry Road
Mt. Pleasant, SC 29464
Pinehurst Oakdale Property, LLC 08-07260
190 Fox Hollow Road
Pinehurst, NC 28374
Winston-Salem Oakdale Property, LLC 08-07261
2500 Polo Ridge Court
Winston-Salem, NC 27106
Nature of Business: Health Care Business
Petition Date: August 17, 2008
Bankruptcy Court: Middle District of Tennessee
Judge: Hon. George C Paine II
Bankruptcy Counsel: Robert A. Guy, Esq.
Waller Lansden Dortch & Davis
511 Union Street
Suite 2700
Nashville, TN 37219
Tel: (615) 244-6380
Fax: (615) 244-6804
Email: bobby.guy@wallerlaw.com
Estimated Assets Estimated Debts
---------------- ---------------
Nashville Senior Living $500,000 to $1 MM $500,000 to $1 MM
Anderson Senior Living $1 MM to $10 MM $50 MM to $100 MM
Charlotte Oakdale $1 MM to $10 MM $50 MM to $100 MM
Greensboro Oakdale $1 MM to $10 MM $50 MM to $100 MM
Mt. Pleasant Oakdale I $1 MM to $10 MM $50 MM to $100 MM
Mt. Pleasant Oakdale II $1 MM to $10 MM $50 MM to $100 MM
Winston-Salem Oakdale $1 MM to $10 MM $50 MM to $100 MM
Pinehurst Oakdale $1 MM to $10 MM $50 MM to $100 MM
A copy of Nashville Senior Living's list of 17 largest unsecured
creditorsis available for free at:
http://bankrupt.com/misc/tnmb08-07254.pdf
A copy of Anderson Senior Living's list of 4 largest unsecured
creditors is available for free at:
http://bankrupt.com/misc/tnmb08-07255.pdf
A copy of Mt. Pleasant Oakdale I's list of 4 largest unsecured
creditors is available for free at:
http://bankrupt.com/misc/tnmb08-07258.pdf
A copy of Mt. Pleasant Oakdale II's list of 4 largest unsecured
creditors is available for free at:
http://bankrupt.com/misc/tnmb08-07259.pdf
Charlotte Oakdale, Greesboro Oakdale, Winston-Salem Oakdale, and
Pinehurst Oakdale have no unsecured creditors.
NAUTILUS RMBS: S&P Cuts Ratings on 7 Classes on Plan to Liquidate
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on seven
classes of notes from Nautilus RMBS CDO III Ltd. Three of these
classes remain on CreditWatch with negative implications. In
addition, S&P removed four of these ratings from CreditWatch
negative.
The downgrades follow the notification from the transaction's
trustee of the controlling noteholders' intent to liquidate the
collateral and terminate the deal.
The deal experienced an event of default (EOD) as a result of the
failure of an overcollateralization-based EOD trigger. Nautilus
RMBS CDO III Ltd. is a cash flow collateralized debt obligation
(CDO) of asset-backed securities (ABS) collateralized by mezzanine
residential mortgage-backed securities (RMBS) and other structured
finance assets.
RATINGS LOWERED AND REMAINING ON CREDITWATCH NEGATIVE
Nautilus RMBS CDO III Ltd.
Rating
Class To From
A-1S BB/Watch Neg AA+/Watch Neg
A-1J CCC-/Watch Neg A+/Watch Neg
A-2 CCC-/Watch Neg A-/Watch Neg
RATINGS LOWERED AND REMOVED FROM CREDITWATCH NEGATIVE
Nautilus RMBS CDO III Ltd.
Rating
Class To From
A-3F CC BBB/Watch Neg
A-3V CC BBB/Watch Neg
B CC BB/Watch Neg
C CC BB-/Watch Neg
NESTOR INC: Edward Heil Resigns as Board Director
-------------------------------------------------
Nestor, Inc. disclosed that Edward F. Heil has resigned as a
member of the company's Board of Directors, effective August 8,
2008. The company is not presently seeking a replacement for
Mr. Heil.
The company's Nominating Committee is considering potential Board
member candidates to replace Class I directors whose term expires
at the next Annual Meeting of Shareholders and may consider a
replacement for the Class II vacancy brought about by Mr. Heil's
resignation.
Clarence Davis, chief executive officer, stated that "We truly
appreciate the efforts and support that Ed Heil has provided. His
contributions have been invaluable to the Board and to the
operation of the company, and he will be sorely missed."
About Nestor Inc.
Nestor Inc. (OTC BB: NEST) -- http://www.nestor.com/- provideds
advanced automated traffic enforcement solutions and services to
state and municipal governments.
At March 31, 2008, the company's consolidated balance sheet showed
$23,441,000 in total assets, $22,827,000 in total liabilities, and
$614,000 in total stockholders' equity.
The company's consolidated balance sheet at March 31, 2008, also
showed strained liquidity with $5,810,000 in total current assets
available to pay $4,239,000 in total current liabilities.
Full-text copies of the company's consolidated financial
statements for the quarter ended March 31, 2007, are available for
free at http://researcharchives.com/t/s?2c0e
Going Concern Disclaimer
As reported in the Troubled Company Reporter on April 24, 2008,
Carlin, Charron, & Rosen LLP expressed substantial doubt about
Nestor Inc.'s ability to continue as a going concern after
auditing the company's consolidated financial statements for the
fiscal year ended Dec. 31, 2007. The auditing firm pointed to the
company's recurring losses from operations.
The company has incurred significant losses since inception and
has an accumulated deficit of $79,007,000 through March 31, 2008.
NETBANK INC: Seeks Clarification of Disclosure Statement Order
--------------------------------------------------------------
NetBank, Inc., and the Official Committee of Unsecured Creditors
jointly pressed the U.S. Bankruptcy Court for the Middle District
of Florida to clarify certain provisions of an order dated July 9,
2008, approving amended disclosure statement explaining the
Debtor's amended chapter 11 liquidation plan.
The Debtor filed its disclosure statement with respect to
liquidating plan of reorganization on May 19, 2008, and its
amended disclosure statement on July 8.
On June 27, 2008, the Debtor filed a motion for approval of
proposed voting and solicitation procedures.
At the filing of the initial plan on May 19, and the hearing to
consider the amended disclosure statement and the procedures
motion on July 9, the Debtor only had knowledge that there were
about 350 holders of record of the Debtor's common stock. The
Debtor recently learned that there are over 11,000 beneficial
holders, all of whom would have been entitled to vote under the
terms of the amended plan and the procedures order.
The Debtor has received an estimate that the cost to the estate to
provide solicitation packages to all interest holders would be in
excess of $250,000.
Under the plan, interest holders in class 8 will receive a pro
rate share of distributions based upon interests held as of the
confirmation date after claims in classes 1 through 7 are paid in
full, including interest.
The Debtor said that because the likelihood of a distribution to
interest holders is remote and the acceptance by the class of
interest holders of the amended plan is irrelevant to
confirmation, the expense of solicitation of acceptances of the
amended plan from interest holders is cost prohibitive.
On July 31, the Debtor filed its amended liquidating plan
modifying the voting rights of interest holders in class 8. The
amended plan provides that interest holders will be deemed to have
rejected the plan in respect of their interests. The plan also
provides that no interest holder needs to cast a ballot and that
any ballots received from them will be disregarded.
Hence, with respect to voting by holders of class 8 equity
interests, the Committee and the Debtor proposed that the voting
procedures include these terms:
a. on July 19, or as soon thereafter as reasonably practicable,
Kurtzman Carson Consultants LLC will provide the equity
holders copies of the solicitation package for each voting
holder on a Computershare list; and
b. each voting holder on the Computershare list will mail the
ballot to KCC so the ballot is received by KCC on Aug. 29,
2008.
c. any record holders of equity interests as a nominee for
the beneficial owner will immediately distribute the
solicitation package to the beneficial owners. Any record
holder willing to perform this duty will immediately inform
the Debtor and the Committee and immediately deliver a list
containing the names and addresses of the beneficial owners
of equity interests.
The Debtor's claims and noticing agent, KCC, was authorized by the
Court to rely on a list maintained by Computershare, Inc., that
showed about 350 record holders of the Debtor's stock as of
July 9, 2008. KCC has already sent to each of the 350 record
holders a copy of the amended plan and notice of non-voting status
of impaired class 8 equity interest holders.
The procedures order should be clarified, the Debtor and the
Committee said, to recognize that nominees for the beneficial
owners of the Debtor's stock have no duty to distribute the
solicitation package to the beneficial owners. Cost of
distribution should be borne by the nominee.
KCC should not be obliged to send any additional copies of the
solicitation package to the nominees if requested.
The provisions concerning the amount of an interest used to
tabulate acceptance or rejection of the amended plan and
instructions on how ballots should be counted no longer apply and
should be disregarded.
About NetBank
Headquartered in Jacksonville, Florida, NetBank, Inc. --
http://www.netbank.com/-- is a financial holding company of
Netbank, the United States' oldest Internet bank serving retail
and business customers in all 50 states. NetBank, Inc. does
retail banking, mortgage banking, business finance, and provides
ATM and merchant processing services.
The company filed for chapter 11 protection on Sept. 28, 2007
(Bankr. M.D. Fla. Case No. 07-04295). Alan M. Weiss, Esq., at
Holland & Knight LLP, represents the Debtor. The U.S. Trustee for
Region 21 appointed six creditors to serve on an Official
Committee of Unsecured Creditors of the Debtor's case. Rogers
Towers, Esq. at Kilpatrick Stockton LLP, represents the Committee
in this case. Rogers Towers P.A. serves as co-counsel to the
Committee. As of Sept. 25, 2007, the Debtor listed total
assets of $87,213,942 and total debts of $42,245,857.
OPTIGENEX INC: Enters into $187,642 Notes Agreement
---------------------------------------------------
Optigenex, Inc. entered into three Callable Secured Convertible
Notes with New Millennium Capital Partners II, LLC, AJW Master
Fund, Ltd. and AJW Partners, LLC on June 30, 2008. The company
entered into these Notes for the purpose of capitalizing interest
owed to these Investors under previously executed notes dated
August 31, 2005, October 19, 2005, February 14, 2006, September
15, 2006, February 12, 2007 and April 15, 2008. The aggregate
principal amount of the three Notes is $187,642 which was equal to
the aggregate amount of interest owed to the Investors as of June
30, 2008. The company said it did not receive any funds from the
Investors in connection with entering into these Notes.
The Notes carry an interest rate of 2% and a maturity date of June
30, 2011. The Notes are convertible into shares of common stock at
the Variable Conversion Price which shall be equal to the
Applicable Percentage multiplied by the average of the lowest
three (3) trading prices for our shares of common stock during the
twenty (20) trading day period prior to conversion. The Applicable
Percentage is 45%.
At the company's option, it may prepay the Notes in the event that
no event of default exists, there are a sufficient number of
shares available for conversion of the Notes and the market price
is at or below $0.04 per share.
Should the company elects to prepay the Notes, the following
additional amounts would be due. Outstanding principal amount
times (i) 135% for prepayments made within 30 days of the date of
the Note; (ii) 145% for prepayments made between 31 and 90 days of
the date of the Note; (iii) 150% for prepayments made after 90
days of the date of the Note.
The Investors have contractually agreed to restrict their ability
to convert the Notes and receive shares of the Company's common
stock such that the number of shares of the Company's common stock
held by them and their affiliates after such conversion or
exercise does not exceed 4.99% of the then issued and outstanding
shares of the Company's common stock.
The company's obligations under the Notes are secured by that
certain Security Agreement and that certain Intellectual Property
Security Agreement, each by and among us and each Investor dated
February 12, 2007.
The company said it is committed to registering the shares of
common stock underlying the Notes upon written demand of the
Investors. It must file the registration statement within 30 days
from the date on which it receives the Demand Notice otherwise it
may be subject to penalty provisions. There are penalty provisions
for the company should the filing not be declared effective within
120 days of the filing of the registration statement.
The sale of Notes was completed on June 30, 2008. At the closing,
the company became obligated to the Investors for $187,642. The
Notes are a debt obligation arising other than in the ordinary
course of business which constitute a direct financial obligation
of us.
Securities Purchase Agreement
On July 15, 2008, the company entered into a Securities Purchase
Agreement with New Millennium Capital Partners II, LLC. Under the
terms of the Securities Purchase Agreement, the Investor purchased
a $25,000 callable secured convertible note and a warrant to
purchase 30,000,000 shares of common stock. The company received
the funds from this financing on July 17, 2008.
The Note carries an interest rate of 8% per annum and matures on
July 15, 2011. At the election of the Investor, the Note is
convertible into shares of common stock at the lesser of (i) the
Variable Conversion Price (as defined hereafter); or (ii) the
Fixed Conversion Price of $3.20. The Variable Conversion Price
shall be equal to the Applicable Percentage multiplied by the
average of the lowest three (3) intraday trading prices for our
shares of common stock during the twenty (20) trading day period
prior to conversion. The Applicable Percentage is 45%.
At the option of the company, it may prepay the Note in the event
that no event of default exists, there are a sufficient number of
shares available for the conversion of the Note and the market
price is at or below $3.20 per share. Should the company elect to
prepay the Note, the following additional amounts would be due:
Outstanding principal amount times (i) 120% for prepayments made
within 30 days of the date of the Note; (ii) 130% for prepayments
made between 31 and 60 days of the date of the Note; (iii) 140%
for prepayments made after 60 days of the date of the Note. In
addition, in the event that the average daily price of the common
stock, as reported by the reporting service, for each day of the
month ending on a determination date is below $0.001, the company
may prepay a portion of the outstanding principal amount of the
Note equal to 104% of the principal amount hereof divided by
thirty-six (36) plus one month’s interest. Exercise of this option
will stay all conversions for the following month.
The full principal amount of the Note is due upon an event of
default under the terms of Note. In addition, the Company has
granted the investor a security interest in substantially all of
its assets and intellectual property as well as demand
registration rights.
The company simultaneously issued to the Investor a seven-year
warrant to purchase 30,000,000 shares of common stock at an
exercise price of $0.001.
The Investor has contractually agreed to restrict its ability to
convert the Note and exercise the Warrant and receive shares of
the Company's common stock such that the number of shares of the
Company's common stock held by the Investor and its affiliates
after such conversion or exercise does not exceed 4.99% of the
then issued and outstanding shares of the Company's common stock.
The company said it is committed to registering the shares of
common stock underlying the Note upon written demand of the
Investor. It must file the registration statement with the SEC
within 10 days from the date on which it receive the Demand Notice
otherwise it may be subject to penalty provisions. There are also
penalty provisions in the event that the registration statement is
not declared effective by the SEC within 90 days from the date on
which it receive the Demand Notice.
The sale of Note was completed on July 17, 2008. At the closing,
the company became obligated to the Investor for $25,000. The Note
is a debt obligation arising other than in the ordinary course of
business which constitute a direct financial obligation of us.
Going Concern Disclaimer
Stark Winter Schenkein & Co., LLP, in Denver, expressed
substantial dobut about Optigenex Inc.'s ability to continue as a
going concern after auditing the company's financial statements
for the year ended Dec. 31, 2007. The auditing firm pointed to
the company's significant losses from operations and working
capital and stockholder deficiencies.
About Optigenex Inc.
Headquartered in Lyndhurst, N.J., Optigenex Inc. (OTC BB: OPGX.OB)
supplies bulk material and finished products featuring its
patented and wholly natural compound AC-11(R) as a core ingredient
to wholesale distributors, skin care and nutraceutical marketing
companies. In addition, the company licenses its technology and
trademark to third party marketers and manufacturers of skin care
and nutraceutical products.
PERKINS & MARIE: Cut to 'CCC+' by S&P on Likely Covenant Breach
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings, including
the corporate credit rating, on Memphis, Tenn.-based Perkins &
Marie Callender's Inc. (Perkins) to 'CCC+' from 'B-'. The outlook
is negative.
"The downgrade reflects the possibility that Perkins will breach
financial covenants of its senior secured credit facility in the
third quarter of fiscal 2008," said Standard & Poor's credit
analyst Jackie E. Oberoi, "as the company may need to increase
debt levels to build inventory for its seasonal pie business."
Should Perkins meet financial covenants in the third quarter, we
believe they will not meet them when the covenants become more
restrictive at year-end. "We believe the company will have a
difficult time improving profitability or free cash flows
significantly," added Ms. Oberoi, "given the cost and competitive
pressures facing the restaurant industry and therefore, any
meaningful improvement of the leverage ratios for covenant
purposes is unlikely."
PIERRE FOODS: Wants Perella Weinberg as Investment Banker
---------------------------------------------------------
Pierre Foods Inc. and its debtor-affiliates ask permission from
the United States Bankruptcy Court for the District of Delaware to
employ Perella Weinberg Partners, L.P., as their investment banker
and financial advisor.
The Firm is expected to familiarize itself with the business of
the Debtors, review their financial condition and all other
related advisory services.
Michael A. Kramer, Esq., a partner at the Firm, told the Court
that it will bill the Debtors:
(a) a financial advisory fee of $300,000;
(b) a monthly financial advisory fee of $150,000, commencing on
the earlier of July 1, 2008 or the date on which the Debtor
is or becomes a debtor under Chapter 11 bankruptcy, and
payable in advance on each monthly anniversary of such
earlier date;
(c) and a Transaction Fee of $2,000,000, payable promptly upon
consummation of a Restructuring.
Mr. Kramer assured the Court that the firm does not represent any
interest adverse to the Debtors' estates.
Headquartered in Cincinnati, Ohio, Pierre Foods Inc. --
http://www.pierrefoods.com-- manufactures and sells ready-to-cook
and pre-cook products. The company and and 13 of its affiliates
filed for Chapter 11 protection on July 15, 2008 (Bankr. D. Del.
Lead Case No.08-11469). Paul Noble Heath, Esq., at Richards,
Layton & Finger P.A., represents the Debtors in their restucturing
efforts. The Debtors selected Kurtzman Carson Consultants LLC as
their claims agent. When the Debtors filed for protection against
their creditors, they listed estimated assets between $500 million
and $1 billion, and estimated debts between $100 million and $500
million.
PRESTIGE AUTO: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Prestige Auto Sales, LLC
400 East Main Street
Senatobia, MS 38668
Bankruptcy Case No.: 08-13226
Chapter 11 Petition Date: August 14, 2008
Court: Northern District of Mississippi (Aberdeen)
Debtor's Counsel: Craig M. Geno, Esq.
(cmgeno@harrisgeno.com)
Harris Jernigan & Geno, PLLC
P.O. Box 3380
Ridgeland, MS 39158-3380
Tel: (601) 427-0048
Fax: (601) 427-0050
Estimated Assets: $1,000,000 to $10,000,000
Estimated Debts: $1,000,000 to $10,000,000
The Debtor does not have any unsecured creditors who are not
insiders.
PROXYMED INC: Has Until January to Comply with Nasdaq Requirement
-----------------------------------------------------------------
ProxyMed, Inc. d/b/a MedAvant Healthcare Solutions received on
July 16, 2008, a letter from The Nasdaq Stock Market indicating
that, for the prior 30 consecutive trading days, its common stock
had not maintained the minimum bid price of $1.00 per share
required for continued listing, as set forth in Nasdaq Marketplace
Rule 4450(a)(5).
The letter also indicated that, in accordance with Marketplace
Rule 4450(e)(2), the Company would be provided 180 calendar days,
or until January 12, 2009, to regain compliance with the Minimum
Bid Price Rule, and if at any time before January 12, 2009, if the
minimum bid price of the Company's common stock were to close at
One Dollar ($1.00) per share or more for a minimum of ten (10)
consecutive trading days, the Nasdaq staff would provide written
notification that the Company would be in compliance with the
Minimum Bid Price Rule. However, if the Company were unable to
regain compliance with the Minimum Bid Price Rule by January 12,
2009, the Nasdaq staff would provide written notification that the
Company's common stock would be delisted from the Nasdaq Global
Market.
As disclosed in a prior Current Report on Form 8-K, filed with the
SEC on April 24, 2008, the Company previously received a letter
from Nasdaq on April 22, 2008 that notified the Company that it
had not maintained the minimum value of publicly held shares of
$15,000,000 required for continued listing on the Nasdaq Global
Market, as set forth in Marketplace Rule 4450(b)(3). The Company
had until July 21, 2008 to regain compliance with the MVPHS Rule.
The June 16, 2008 letter from Nasdaq has no effect on the April
22, 2008 notice of non-compliance with the MVPHS Rule that the
Company received from Nasdaq. In the event the Company did not
regain compliance with the MVPHS Rule by July 21, 2008, Nasdaq
would issue a notice of delisting of the Company's securities from
the Nasdaq Global Market. The Company would then have seven (7)
calendar days from the date of any such delisting notice to appeal
the Nasdaq delisting by requesting a hearing before a Nasdaq
Listing Qualifications Panel.
On July 22, 2008, the Company issued a press release announcing
the Company's receipt of the Nasdaq listing standard deficiency
letter (as required by Marketplace Rule 4803(a)).
About ProxyMed Inc.
Headquartered in Norcross, Georgia, ProxyMed Inc. fka MedUnite,
Inc. -- http://www.medavanthealth.com-- facilitates the exchange
of medical claim and clinical information. The company and two of
its affiliates filed for Chapter 11 protection on July 23, 2008
(Bankr. D. Del. Lead Case No.08-11551). Kara Hammond Coyle, Esq.,
and Michael R. Nestor, Esq., at Young Conaway Stargatt & Taylor,
L.L.P., represent the Debtors in their restructuring efforts.
The Debtors indicated $40,655,000 in total consolidated assets and
$47,640,000 in total consolidated debts as of December 31, 2007.
In its petition, ProxyMed Transaction Services, Inc. indicated
$10,000,0000 in estimated assets and $10,000,000 in estimated
debts.
As reported by the Troubled Company Reporter on Aug. 11, 2008,
ProxyMed Inc. disclosed that the Judge presiding over its chapter
11 case in Delaware approved the Debtor's proposed bid procedures
and timetable for the auction of the company's assets on Sept. 8,
2008.
QUALITY HOME: Case Trustee, Committee Ask Release of $1.1MM Fund
----------------------------------------------------------------
The Official Committee of Unsecured Creditors in the bankruptcy
case of Quality Home Loans and its debtor affiliates, and David
Gould, chapter 11 trustee, urged that U.S. Bankruptcy Court for
the Central District of California to release to the case trustee
$1,117,084 of the funds held in a QHL QX1 Reserve.
The funds sought to be released represent advances previously made
by the Debtor to Countrywide Home Loans, Inc., and Countrywide
Securities Corporation using estate resources. The funds of about
$5,386,957 were recovered by the Debtor pursuant to a settlement
agreement approved by the Court.
Restrictions were placed on the funds to ensure that the funds
could be made available to pay certain claims if necessary. The
funds did not, however, have recourse to a $1,400,000 set aside in
the funds designated to reimburse the Debtor for $1,117,084 carry
costs. Carry costs represent the interest charged by Countrywide
from the time mortgage loans were purchased under mortgage loan
purchase agreements until the close of securitization.
Since the settlement order was entered, FTI Consulting, Inc., on
behalf of the case trustee and the Committee has collected data
and evaluated the accounting for more than $5,000 July
securitization, including the carry costs distribution.
FTI determined that the amount actually advanced to cover carry
costs was about $1,117,084, which is slightly less than initially
thought by the Debtor. The Debtor's estimate of $1,400,000 was
based on a schedule allocating the total carry costs to the
Debtor, rather pro rata based on the unpaid principal balance of
the mortgage loans contributed by each entity.
The Debtor, according to FTI, is entitled to recover $1,117,084
for advances it made to pay the carry costs.
The Court has set to continue hearing on the matter on Oct. 7,
2008, at 10:00 a.m.
About Quality Home Loans
Based in Agoura Hills, California, Quality Home Loans --
http://www.qualityhomeloans.com/-- is a residential hard money
lender. The company does business as Clear Credit Capital, Last
Chance Home Loans, Last Option Lending, and Q.H.L. Investments.
The company and its debtor-affiliates filed for Chapter 11
protection on Aug. 21, 2007 (Bankr. C.D. Calif. Case Nos. 07-
13003 through 07-13006). William N. Nobel, Esq., and Mike D.
Neue, Esq., at Irell & Manella LLP, represent the Debtors in their
restructuring efforts. Eric. E. Sagerman, Esq., and David L.
Wilson III, Esq., at Winston & Strawn LLP, act as counsels to the
Official Committee of Unsecured Creditors. David Gould was
appointed by the Court as chapter 11 trustee. Lewis R. Landau,
Esq., at Lewis R. Landau Attorney at Law is general bankruptcy
counsel and Irell & Manella LLP is special counsel to the chapter
11 trustee. The Debtors' schedules disclose total assets of
$130,319,336 and total debts of $177,043,476.
QUALITY HOME: S&P Raises Corp. Credit Rating to 'B-'; Off Watch
---------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on Cary,
N.C.-based Quality Home Brands Holdings LLC (QHB), including its
corporate credit rating to 'B-' from 'CCC'.
"At the same time, we raised the ratings on the company's senior
secured first-lien term loan B and revolving credit facility to
'B', from 'CCC+', and affirmed the recovery rating of '2'. We also
raised QHB's senior secured second-lien term loan rating to 'CCC',
two notches below the corporate credit rating, from 'CC' and
affirmed the recovery rating of '6'. The outlook is stable. As of
June 27, 2008, QHB had about $458 million of debt (including
holdco PIK notes)," S&P says.
"We also removed the ratings from CreditWatch, where we had placed
them on April 4, 2008 with negative implications due to weaker-
than-expected credit measures and our concerns that given the weak
housing market and current economic conditions, the company would
remain challenged to restore operating results and meet bank
financial covenants throughout the remainder of 2008.
"We revised the CreditWatch implications to developing on Aug. 7,
2008, following the company's receipt of an amendment to its
first-lien credit facility, which would provide the company with
an adequate financial covenant cushion. The upgrade reflects the
effective amendment to the first-lien credit facility, which
provides the company with greater covenant cushion and an overall
enhanced liquidity profile over the near term, due to required
equity infusions from QHB's financial sponsor and a reset of the
company's total leverage, senior leverage, and interest coverage
covenants, thereby improving cushion levels," S&P adds.
"The stable outlook on QHB reflects our belief that the company
will have adequate liquidity and cushion under its financial
covenants over the next 12 months, despite our concerns that
current weak housing conditions will continue," said Standard &
Poor's credit analyst Bea Chiem. However, we could revise the
outlook to negative if leverage increases to 9x and/or the amount
of covenant cushion significantly tightens, which would constrain
the company's liquidity position.
"While highly unlikely over the near term, we would consider an
outlook revision to positive if the company can reduce leverage to
below 8x, maintain adequate liquidity, and improve overall
operating performance," she continued.
RACERS 2006-18-C: S&P Cuts Rating to 'B' on Long Beach Downgrade
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on the $75
million credit-linked certificates from Restructured Asset
Certificates w/Enhanced Returns (RACERS) Series 2006-18-C
(ABX_A_06_1_i) to 'B' from 'BB'.
The downgrade reflects the July 23, 2008, lowering of the rating
on the referenced obligations, the class M-5 asset-backed
certificates due Aug. 25, 2035, issued by Long Beach Mortgage Loan
Trust 2005-WL2.
RACERS 2006-18-C (ABX_A_06_1_i) is a credit-linked transaction,
the rating on which is based on the lower of (i) the rating on the
underlying securities, the certificates issued by RACERS Series
2006-15-A Trust ('AAA') and (ii) the lowest rating on the
obligations referenced under the credit default swap trade ('B').
RED SHIELD: U.S. Trustee Forms Five-Member Creditors' Committee
---------------------------------------------------------------
(melanie--court)
Phoebe Morse, the United States Trustee for Region 1, named five
creditors to serve in the Official Committee of Unsecured
Creditors in the bankruptcy case of Red Shield Environmental, LLC,
and its debtor-affiliate.
The members of the Committee are:
a. Scott Johnson
Bluewater Energy Solutions, Inc
c/o Randy Creswell
One Canal Plaza, P.O. Box 426
Portland, ME 04112-0426
Phone: 207-774-2635
b. Dennis Lemieux
Berry Dunn McNeil & Parker
100 Middle St.
Portland, ME 04101
Phone: 207-775-2387
c. Vaughn Black
International Paper Company
4049 Willow Lake Blvd.
Memphis, TN 38118
Phone: 901-419-1751
d. Bob Mullin
F.W. Webb Co.
160 Middlesex
Bedford, MA 01736
Phone: 781-272-6600
e. Jerry Schaeffer
EKA Chemical Inc.
1775 West Oak Commons
Marietta, GA 30060
Phone: (715) 362-1888
Official creditors' committees have the right to employ legal
and accounting professionals and financial advisors, at the
Debtors' expense. They may investigate the Debtors' business and
financial affairs. Importantly, official committees serve as
fiduciaries to the general population of creditors they represent.
Those committees will also attempt to negotiate the terms of a
consensual Chapter 11 plan -- almost always subject to the terms
of strict confidentiality agreements with the Debtors and other
core parties-in-interest. If negotiations break down, the
Committee may ask the Bankruptcy Court to replace management with
an independent trustee. If the Committee concludes reorganization
of the Debtor is impossible, the Committee will urge the
Bankruptcy Court to convert the Chapter 11 cases to a liquidation
proceeding.
About Red Shield
Headquartered in Old Town, Maine, Red Shield Environmental, LLC --
http://www.redshieldenv.com/-- provides renewable energy for on-
site consumption. The company and its affiliate, RSE Pulp &
Chemical, LLC, filed for chapter 11 protection on June 27, 2008
(Bankr. D. Maine Lead Case Nos. 08-10634 and 08-10634). Robert J.
Keach, Esq., at Bernstein, Shur, Sawyer & Nelson, represents the
Debtors in their restructuring efforts. When the Debtors filed
for protection against their creditors, they listed assets of
between $50 million and $100 million, and debts of between
$1 million and $10 million.
RED SHIELD: May Hire Windsor Associates as Financial Advisor
------------------------------------------------------------
Red Shield Environmental, LLC, and RSE Pulp & Chemical, LLC,
obtained permission from the Hon. Louis H. Kornreich of the U.S.
Bankruptcy Court for the District of Maine to employ Windsor
Associates, LLC, as their financial consultant.
The firm will:
a. review and provide input on the Debtors' operating budget
throughout the chapter 11 case;
b. assist the Debtors in their projected income models and
plans for restructuring; and
c. provide the Debtors with advice in relation to all financial
matters in this case, including preparation of schedules,
monthly operating reports and other required reporting.
Windsor shall be paid 90% of its fees and 100% of its costs every
month for which Windsor provides an invoice to the Debtors.
The Debtors and John C. Thibodeau at Windsor assured the Court
that the firm and its professionals are disinterested and do not
represent or hold any interest adverse to the Debtors or the
estates.
About Red Shield
Headquartered in Old Town, Maine, Red Shield Environmental, LLC --
http://www.redshieldenv.com/-- provides renewable energy for on-
site consumption. The company and its affiliate, RSE Pulp &
Chemical, LLC, filed for chapter 11 protection on June 27, 2008
(Bankr. D. Maine Lead Case Nos. 08-10634 and 08-10634). Robert J.
Keach, Esq., at Bernstein, Shur, Sawyer & Nelson, represents the
Debtors in their restructuring efforts. When the Debtors filed
for protection against their creditors, they listed assets of
between $50 million and $100 million, and debts of between
$1 million and $10 million.
RED SHIELD: Creditors' Committee Taps Perkins Thompson as Counsel
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Maine gave the
Official Committee of Unsecured Creditors of Red Shield
Environmental, LLC, and RSE Pulp & Chemical, LLC, authority to
retain Fred W. Bopp III, Esq., Randy J. Creswell, Esq., and
Anthony J. Manhart, Esq., at Perkins Thompson, P.A. as Committee
counsels.
Perkins Thompson will render various legal services as the
Committee may consider desirable to discharge its responsibilities
and further the Committee's interests in these cases. The firm
will also act as primary spokesperson for the Committee.
Perkins Thompson will be paid: fees to be charged for services
rendered at the normal hourly rates for attorneys -- currently
between $125 and $275 -- and paralegals -- currently $95 per
hour. Perkins Thompson's current good faith estimate of the
anticipated range of fees to be charged for such services is
between $50,000 and $100,000, or more, with the upper end of that
range being more likely if any litigation is necessary.
To the best of the Committee's knowledge, Perkins Thompson is a
"disinterested person" and does not represent or hold an interest
adverse to the estates with respect to the matters on which
Perkins Thompson is employed.
About Red Shield
Headquartered in Old Town, Maine, Red Shield Environmental, LLC --
http://www.redshieldenv.com/-- provides renewable energy for on-
site consumption. The company and its affiliate, RSE Pulp &
Chemical, LLC, filed for chapter 11 protection on June 27, 2008
(Bankr. D. Maine Lead Case Nos. 08-10634 and 08-10634). Robert J.
Keach, Esq., at Bernstein, Shur, Sawyer & Nelson, represents the
Debtors in their restructuring efforts. When the Debtors filed
for protection against their creditors, they listed assets of
between $50 million and $100 million, and debts of between
$1 million and $10 million.
RED SHIELD: Creditors' Panel Wants Aurora Management as Advisor
---------------------------------------------------------------
The Official Committee of Unsecured Creditors in the bankruptcy
case of Red Shield Environmental, LLC, and RSE Pulp & Chemical,
LLC, asked the U.S. Bankruptcy Court for the District of Maine for
authority to engage David M. Baker, CPA, and James C. Ebbert, CTP,
at Aurora Management Partners, Inc., as its financial advisors.
Aurora is expected to review and provide input on Debtors'
operating budget throughout the Chapter 11 cases, with emphasis on
providing the best return in the shortest amount of time for the
Committee's constituents; advise the Committee with respect to any
potential plans of reorganization, sales of Debtors' assets, or
other work-outs scenarios and financing; and provide the Committee
with advice in relation to all financial matters in these cases,
including review of Debtors' schedules, monthly operating reports,
and other required reporting.
Any fees and costs in the retention of Aurora will be paid out of
the $100,000 in funds reserved by Debtors in their budget for the
payment of professional fees, and other funds of the estates, or
by further carve outs as allocated in additional funding.
Aurora's current good faith estimate of the anticipated range of
fees to be charged for its services is between $10,000 and
$35,000.
To the best of the Committee's knowledge, Aurora does not have any
connection with, or any interest adverse to, Debtors, their
creditors, any other party in interest.
Aurora maintains offices at 4485 Tench Road, Suite 340A in
Atlanta, Georgia.
About Red Shield
Headquartered in Old Town, Maine, Red Shield Environmental, LLC --
http://www.redshieldenv.com/-- provides renewable energy for on-
site consumption. The company and its affiliate, RSE Pulp &
Chemical, LLC, filed for chapter 11 protection on June 27, 2008
(Bankr. D. Maine Lead Case Nos. 08-10634 and 08-10634). Robert J.
Keach, Esq., at Bernstein, Shur, Sawyer & Nelson, represents the
Debtors in their restructuring efforts. When the Debtors filed
for protection against their creditors, they listed assets of
between $50 million and $100 million, and debts of between
$1 million and $10 million.
RED SHIELD: Preti Wants Chapter 11 Trustees Named for Each Debtor
-----------------------------------------------------------------
Creditor Preti, Flaherty, Beliveau & Pachios, LLP, asked the U.S.
Bankruptcy Court for the District of Maine to appoint chapter 11
trustees in each of the cases of Red Shield Environmental, LLC,
and RSE Pulp & Chemical, LLC.
Preti said that although the Debtors have different ownership
structures -- as revealed by the schedules of 20 largest creditors
filed to date and different bodies of creditors -- the two Debtors
are nevertheless managed and controlled by the same manager,
Edward T. Paslawski. While the Debtors are under common
management, there are critical contracts between the two Debtors
relating to real estate and equipment leases, sale of steam and
electricity, and the provision of management services, Preti
related. These contracts encompass virtually 100% of the
production inputs and facilities usage of both Debtors, leaving
very little to arms length control. In fact, these contracts are
RSE's only material assets, Preti asserted.
Preti identified three critical areas to the operation of the
chapter 11 proceedings. These are: (a) day to day operations,
including setting of transfer prices under each of the contracts,
and establishing performance standards and financing of
operations, (b) decisions regarding the assumption and rejection
of each of the executory contracts, whether in the context of
operations, a sale of one or both of the Debtors or the
confirmation of plans of reorganization, and (c) the evaluation
and prosecution of causes of action that each Debtor may have
against the other.
Yet, Preti noted, in each of these areas of debtor-in-possession
functionality, both Debtors act through the same manager and his
management team. According to Preti, the two Debtors are adverse
to one another with respect to contracts. They are unified in
management and locked in an inescapable conflict of interest.
George J. Marcus, Esq., at Marcus, Clegg & Mistretta, P.A.,
represents Preti.
As reported by the Troubled Company Reporter on Aug. 5, 2008, the
Debtors obtained permission from the Court to tap Whitebox Red
Shield, Inc.'s cash collateral. The Court overruled Preti's
objection to the Debtors' request to tap their lender's cash
collateral.
About Red Shield
Headquartered in Old Town, Maine, Red Shield Environmental, LLC --
http://www.redshieldenv.com/-- provides renewable energy for on-
site consumption. The company and its affiliate, RSE Pulp &
Chemical, LLC, filed for chapter 11 protection on June 27, 2008
(Bankr. D. Maine Lead Case Nos. 08-10634 and 08-10634). Robert J.
Keach, Esq., at Bernstein, Shur, Sawyer & Nelson, represents the
Debtors in their restructuring efforts. When the Debtors filed
for protection against their creditors, they listed assets of
between $50 million and $100 million, and debts of between
$1 million and $10 million.
RICHARD SADALA: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Richard L. Sadala
3504 Aldie Road
Catharpin, VA 20143
Linda H. Sadala
3504 Aldie Road
Catharpin, VA 20143
Bankruptcy Case No.: 08-14859
Chapter 11 Petition Date: August 14, 2008
Court: Eastern District of Virginia (Alexandria)
Debtor's Counsel: Spencer D. Ault, Esq.
(Spencer@Aultlawyer.com)
Law Office of Spencer D. Ault
13193 Mountain Road
Lovettsville, VA 20180
Tel: (703) 777-7800
Fax: (540) 822-3880
Estimated Assets: $1 million to $10 million
Estimated Debts: $1 million to $10 million
A list of the Debtor's largest unsecured creditors is available
for free at http://bankrupt.com/misc/VAeb08-14859.pdf
RIVIERA HOLDINGS: June 30 Balance Sheet Upside-Down by $43 Million
------------------------------------------------------------------
Riviera Holdings Corporation reported financial results for the
three and six-month periods ended June 30, 2008.
At June 30, 2008, the company's balance sheet showed total assets
of $217.2 million and total liabilities of $260.2 million,
resulting in a $43 million stockholders' deficiency.
Net revenues for the second quarter of 2008 were $45.6 million, a
decrease of $8.1 million, or 15%, from $53.7 million for the
comparable period in the prior year. Income from operations for
the second quarter of 2008 was $5.0 million, a decrease of
$4.4 million, or 47%, from $9.4 million for the comparable period
in the prior year. Income from operations for the second quarter
of 2008 included $927,000 in corporate payroll and related
expenses compared to $1.0 million in the comparable period in the
prior year, $249,000 in equity compensation costs compared to
$354,000 in the comparable period in the prior year and $22,000 in
mergers and acquisitions and development costs compared to
$238,000 in the comparable period in the prior year.
Net income for the second quarter of 2008 was $10.1 million, an
increase of $6.5 million, from $3.6 million for the comparable
period in the prior year. Net income included $4.3 million and
$6.7 million in interest expense, net of interest income, for the
second quarters ending June 30, 2008 and June 30, 2007,
respectively. The decrease in interest expense, net of interest
income, was due primarily to more favorable interest rate terms
associated with our new credit agreement, executed June 2007. Net
income also included $9.3 million and $0.8 million in gain on the
company's interest rate swap derivative for the second quarters
ending June 30, 2008 and June 30, 2007, respectively. The gain on
our interest rate swap derivative had no effect on cash or cash
equivalents and is the result of a change in the cost of
terminating the company's interest rate swap derivative agreement.
The cost of terminating the agreement, which is reflected as a
long-term liability on the company's financial statements and
fluctuates with changes in interest rates, was approximately
$12.3 million as of June 30, 2008.
"It was a challenging quarter as management continued to focus on
optimizing profits during these difficult economic times," William
L. Westerman, the Chief Executive Officer of Riviera Holdings
Corporation, said. "It was the perfect storm with deteriorated
economic conditions, high fuel prices, the effects of a Colorado
smoking ban, and the impact of neighboring construction projects
in Las Vegas. Most of our revenue loss was attributable to less
play on our slot machines at both properties. There are few
direct costs required to operate our slot machines; therefore,
management was forced to reduce other costs and expenses in order
to offset declines in slot machine revenue. I am proud that our
team was able to quickly adapt to the changing business conditions
and preserve income from operations, while continuing to deliver
exceptional customer service."
Six Months Ended June 30, 2008
Net revenues for the six months ended June 30, 2008 were
$93.6 million, a decrease of $12.1 million, or 12%, from
$105.7 million a year ago. Income from operations for the six
months ended June 30, 2008 was $11.8 million, a decrease of
$6.6 million, or 36%, from $18.4 million for the comparable period
in the prior year. Included in income from operations for the
first six months of 2008 was $1.9 million in corporate payroll and
related expense compared to $2.0 million a year ago, $432,000 in
equity-based compensation costs compared to $553,000 a year ago
and $45,000 in mergers, acquisitions and development costs
compared to $288,000 a year ago.
Net income for the six months ended June 30, 2008 was
$4.3 million, or $0.34 per share on a fully diluted basis, a
decrease of $1.8 million, from $6.1 million, or $0.49 per share on
a fully diluted basis, for the comparable period in 2007. Net
income included $8.5 million and $13.1 million in interest
expense, net of interest income, for the six months ending June
30, 2008 and June 30 2007, respectively. The decrease in interest
expense, net of interest income, was due primarily to more
favorable interest rate terms associated with our new credit
agreement, executed June 2007. Net income also included
$1.0 million and $0.8 million in gain on our interest rate swap
derivative for the six months ending June 30, 2008 and June 30,
2007, respectively. The gain on our interest rate swap derivative
had no effect on cash or cash equivalents and is the result of a
change in the cost of terminating our interest rate swap
derivative agreement.
"While it has been a difficult first half of 2008, the financing
we secured in 2007 enabled us to reduce interest costs by
$5.5 million for the six months ended June 30, 2008. We have
reinvested these savings into our room renovation project at our
Las Vegas property, which is proceeding on schedule. I anticipate
that our new room product will give us a competitive edge and
deliver excellent return on investment. In addition, during the
first six-month period of 2008, we have streamlined our operating
costs and structure, and have added key management team members.
I strongly believe that we are poised to weather the current
economic conditions and capitalize on any future opportunities,"
commented Mr. Westerman.
Riviera Las Vegas
Net revenues for the three months ended June 30, 2008 were
$34.5 million, a decrease of $5.7 million, or 14%, from
$40.2 million for the comparable period in the prior year. Income
from operations for the three months ended June 30, 2008 was
$4.2 million, a decrease of $3.6 million, or 46%, from
$7.8 million for the comparable period in the prior year.
Net revenues for the six months ended June 30, 2008 were
$71.0 million, a decrease of $7.7 million, or 10%, from
$78.7 million for the comparable period in the prior year. Income
from operations for the six months ended June 30, 2008 was
$9.8 million, a decrease of $4.9 million, or 34%, from
$14.7 million for the comparable period in the prior year.
Riviera Black Hawk
Net revenues for the three months ended June 30, 2008 were
$11.1 million, a decrease of $2.4 million, or 18%, from
$13.5 million for the comparable period in the prior year. Income
from operations for the three months ended June 30, 2008 was
$2.0 million, a decrease of $1.2 million, or 38%, from
$3.3 million for the comparable period in the prior year.
Net revenues for the six months ended June 30, 2008 were
$22.6 million, a decrease of $4.4 million, or 16%, from
$27.0 million for the comparable period in the prior year. Income
from operations for the six months ended June 30, 2008 was
$4.3 million, a decrease of $2.2 million, or 33%, from
$6.5 million for the comparable period in the prior year.
About Riviera Holding
Headquartered in Las Vegas, Riviera Holdings Corporation (Amex:
RIV) -- http://www.rivierahotel.com/-- owns and operates the
Riviera Hotel and Casino on the Las Vegas Strip and the Riviera
Black Hawk Casino in Black Hawk, Colorado.
* * *
As reported in the Troubled Company Reporter on July 22, 2008,
Moody's Investor's Service revised Riviera Holding Corporation's
rating outlook to negative from stable. The company's B2
corporate family, B2 probability of default, and B2 senior secured
ratings were affirmed.
As disclosed in the TCR on June 24, 2008, Standard & Poor's
Ratings Services revised its outlook on Riviera Holdings Corp. to
negative from developing. Ratings on Riviera, including the 'B'
corporate credit rating, were affirmed. Total debt outstanding at
March 31, 2008 was $225 million.
SABABA GROUP: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Debtor: Sababa Group Inc.
fka Sababa Global Consumer Products
fka Front Porch Classics
fdba Sababa Toys
470 7th Avenue, 6th Floor
New York, NY 10018
Bankruptcy Case No.: 08-13174
Related Information: Richard Malagodi, chief restructuring officer
filed the petition on the Debtor's behalf.
Chapter 11 Petition Date: August 13, 2008
Court: Southern District of New York (Manhattan)
Judge: James M. Peck
Debtor's Counsel: Christopher M. Desiderio, Esq.
(cdesiderio@nixonpeabody.com)
Nixon Peabody LLP
437 Madison Avenue
New York, NY 10022
Tel: (212) 940-3000
Fax: (212) 940-3111
Estimated Assets: $1 million to $10 million
Estimated Debts: $10 million to $50 million
A list of the Debtor's largest unsecured creditors is available
for free at http://bankrupt.com/misc/NYsb08-13174.pdf
SAM SELTZERS: U.S. Trustee Appoints Two Members to Creditors Panel
------------------------------------------------------------------
Felicia S. Turner, the U.S. Trustee for Region 21, appointed two
members to the Official Committee of Unsecured Creditors in Sam
Seltzer's Steak Houses of America, Inc., and its debtor-
affiliates' Chapter 11 cases.
The Committee members include:
1) Chris Peters
Amresco Commercial Finance, LLC
412 East Park Center Boulevard, Suite 300
Boise, ID 83706
Tel: (208) 333-2035
Fax: (208) 333-2635
2) William Kaye
JLL Consultants, Inc., on behalf of Coca-Cola Company
31 Rose Lane
East Rockaway, NY 11518
Tel: (516) 374-3705
Fax: (516) 569-6531
Based in Tampa, Florida, Sam Seltzer's Steak Houses of America
Inc. is a private no-frills restaurant chain, which has nine
locations from Port Charlotte to Ocala. It opened its first
location in 1995 on North Dale Mabry Highway in Tampa.
Sam Seltzer's and 14 of its affiliates filed for chapter 11
bankruptcy protection before the U.S. Bankruptcy Court for the
Middle District of Florida on June 27, 2008 (Lead Case No. 08-
09533). Amy Denton Harris, Esq., and Harley E. Riedel, Esq., at
Stichter, Riedel, Blain & Prosser, in Tampa, represent the Debtor.
When it filed for bankruptcy, the Debtor disclosed $10,000,000 to
$50,000,000 in estimated assets and debts. For the fiscal year
ending Oct. 28, 2007, the company had assets of roughly
$18,000,000 and liabilities of $17,400,000, the Ledger reports.
SEMGROUP LP: Bankruptcy Forces BOK to Report Loss
-------------------------------------------------
BOK Financial Corp. revised its second-quarter earnings report to
report a $1.2 million loss instead of a $43.7 million profit due
to its credit exposure to SemGroup LP.
BOK is a participant in an approximately $2.4 billion working
capital and term facility to SemGroup, according to BOK's 8-K form
filed with the Securities and Exchange Commission.
After SemGroup filed for bankruptcy, BOK announced that its credit
exposure to SemGroup would force it to recognize an additional
loss of $71 million for the second quarter in addition to the
$16 million the bank holding company already had reported when it
initially announced earnings.
About SemGroup L.P.
SemGroup L.P. -- http://www.semgrouplp.com/-- is a midstream
service company providing the energy industry means to move
products from the wellhead to the wholesale marketplace. SemGroup
provides diversified services for end users and consumers of crude
oil, natural gas, natural gas liquids, refined products and
asphalt. Services include purchasing, selling, processing,
transporting, terminaling and storing energy. SemGroup serves
customers in the United States, Canada, Mexico, Wales, Switzerland
and Vietnam.
SemGroup L.P. and its debtor-affiliates filed for Chapter 11
protection on July 22, 2008 (Bankr. D. Del. Lead Case No. 08-
11525). These represent the Debtors' restructuring efforts: John
H. Knight, Esq., L. Katherine Good, Esq. and Mark D. Collins, Esq.
at Richards Layton & Finger; Harvey R. Miller, Esq., Michael P.
Kessler, Esq. and Sherri L. Toub, Esq. at Weil, Gotshal & Manges
LLP; and Martin A. Sosland, Esq. and Sylvia A. Mayer, Esq. at Weil
Gotshal & Manges LLP. Kurtzman Carson Consultants L.L.C. is the
Debtors' claims agent. The Debtors' financial advisors are The
Blackstone Group L.P. and A.P. Services LLC. Margot B.
Schonholtz, Esq., and Scott D. Talmadge, Esq., at Kaye Scholer
LLP; and Laurie Selber Silverstein, Esq., at Potter Anderson &
Corroon LLP, represent the Debtors' prepetition lenders.
SemGroup L.P.'s affiliates, SemCAMS ULC and SemCanada Crude
Company, sought protection under the Companies' Creditors
Arrangement Act (Canada) on July 22, 2008. Ernst & Young, Inc.
The CCAA stay expires on Aug. 20, 2008.
SemGroup L.P.'s consolidated, unaudited financial conditions as of
June 30, 2007, showed $5,429,038,000 in total assets and
$5,033,214,000 in total debts. In their petition, they showed
more than $1,000,000,000 in estimated total assets and more than
$1,000,000,000 in total debts.
SONICBLUE INC: Trustee et al. Files Amended Disclosure Statement
----------------------------------------------------------------
Dennis J. Connolly, the appointed Chapter 11 Trustee, and the
reconstituted Official Committee of Unsecured Creditors in the
bankruptcy case of SONICBlue Inc. and its debtor-affiliates,
delivered to the United States Bankruptcy Court for the Northern
District of California on Aug. 11, 2008, a first amended
disclosure statement explaining a first amended joint Chapter 11
plan of liquidation.
A hearing is set for Aug. 28, 2008, at 11:00 a.m., to consider the
adequacy of the disclosure statement. The hearing will take place
at 280 South First St., Courtroom 3070 in San Jose, California.
The plan contemplates the liquidation of all of the Debtors'
assets other than certain estate litigation claims that have been
liquidated. The plan administrator will liquidate the Debtors'
assets and distribute the proceeds of the assets to creditors
pursuant to the plan.
The plan will resolve several intercreditor issues and disputes
through compromises and settlements with the Debtors' creditors.
The proponents prepared compromises and settlements of
intercompany disputes, 2002 noteholders, 1996 noteholders and
SONICBlue claims.
The plan proponents say $77,000,000 will be available for
distribution to holders of allowed claims.
The plan classifies interests against and claims in the Debtors in
nine classes. The classification of interests and claims are:
Treatment of Interests and Claims
Type Estimated Estimated
Class of Claims Treatment Amount Recovery
----- --------- --------- --------- ---------
unclassified administrative 100%
claims
unclassified priority tax $175,187 100%
claims
1 priority claims $12,688 100%
2 secured claims impaired $396,815 100%
3 2002 notes claims impaired $60,600,000 46.4%
4 general unsecured impaired $93,976,486 36.4
claims
5 1996 notes claims impaired $99,000,000 0.6%
6 intercompany impaired $9.750,000 NA
claims
7 convenience class impaired $52,882 50%
8 subordinated $3,700,000 0%
unsecured claims
9 interests NA 0%
Holders of claims in Classes 2, 3, 4, 5, 6, and 7 are entitled to
vote on the plan.
Each holders of Class 1 and 2 claims will be paid in full on the
plan's effective date.
Holders of Class 3 and 4 claims will receive cash equal to a pro
rata share of the liquidation amount on the initial distribution
date. Class 4 claim holders will retain their multiple claims and
receive distribution, if allowed.
Holders of Class 5 will also receive receive cash equal to a pro
rata share of the liquidation amount on the initial distribution
date. Due to the subordination provisions, distributions to Class
5 Claims will be transfered to Class 3 Claims until it receive the
subordination payment amount.
Holder of Class 6 Allowed Claims, will be allowed in full;
however, SONICblue will waive its right to receive a portion of
its distribution against the other Debtors to pay Class 4
allowed claims against each Debtor other than SONICblue a
distribution equal to the percentage distribution to be received
by the Class 4 holders against SONICblue.
Holders of Class 7 convenience class will receive cash equal to
50% of allowed claim up to $250 on the initial distribution date.
Class 8 and 9 will not receive any distribution under the plan.
A full-text copy of the first amended disclosure statement is
available for free at:
http://ResearchArchives.com/t/s?30d6
About SONICblue
Headquartered in Santa Clara, California, SONICblue Incorporated
is involved in the converging Internet, digital media,
entertainment and consumer electronics markets. The Company,
together with three of its wholly owned subsidiaries, Diamond
Multimedia Systems, Inc., ReplayTV, Inc., and Sensory Science
Corporation, filed for chapter 11 protection on Mar. 21, 2003
(Bankr. N.D. Calif. Case Nos. 03-51775 to 03-51778). Craig A.
Barbarosh, Esq., at the LAw Offices of Pillsbury Winthrop,
represents the Debtors in their restructuring efforts. Anne E.
Wells, Esq., and Craig M. Rankin, Esq., at Levene, Neale, Bender,
Rankin and Brill represent the Official Committee of Unsecured
Creditors. When the Debtors filed for protection from their
creditors, they listed assets totaling $342,871,000 and debts
totaling $335,473,000.
SPANISH BROADCASTING: S&P Revises 'B-' Rating Outlook to Negative
-----------------------------------------------------------------
Standard & Poor's Ratings Services revised its rating outlook on
Miami, Fla.-based Spanish Broadcasting System Inc. (SBS) to
negative from stable.
"At the same time, we affirmed our ratings on the company,
including the 'B-' corporate credit rating," S&P says.
"We also revised our recovery rating on SBS's $350 million senior
secured credit facilities. The issue-level rating on this secured
debt remains unchanged at 'B-' (at the same level as the 'B-'
corporate credit rating on the company), while the recovery rating
was revised to '4', indicating our expectation of average (30% to
50%) recovery in the event of a payment default, from '3'," S&P
adds.
"The outlook revision reflects our concern regarding the company's
liquidity position due to continued EBITDA declines and depletion
of cash balances," explained Standard & Poor's credit analyst
Michael Altberg.
Cash balances were $39 million as of June 30, 2008, versus $61
million at Dec. 31, 2007. Although S&P expects the current rate of
cash usage to subside, SBS could consume the majority of its cash
by early 2009, especially in light of its $18.5 million maturity
in January 2009.
The 'B-' rating reflects SBS's significant cash flow concentration
in a few large U.S. Hispanic markets, small cash flow base,
competition from much larger rivals, somewhat below-average EBITDA
margin for a broadcaster, and elevated financial risk from losses
at its start-up station, Mega TV. The radio broadcasting business'
potential to generate good cash flow, the largely resilient asset
values of major-market radio stations, and favorable Spanish-
language population and advertising trends only minimally offset
these factors.
SBS owns or operates 21 radio stations in markets that reach
roughly 48% of the U.S. Hispanic population. In March 2006, the
company launched a television station, Mega TV, which accounted
for about 6% of revenue in 2007, and entailed meaningful start-up
losses. The company has significant revenue concentration in three
markets -- New York, Los Angeles, and Miami -- which account for
70% of revenue in total.
STEVEN HINDS: Case Summary & 4 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Steven M. Hinds
Rochelle L. Hinds
8315 Windsor Bluff Drive
Tampa, FL 33647
Bankruptcy Case No.: 08-12239
Chapter 11 Petition Date: August 14, 2008
Court: Middle District of Florida (Tampa)
Debtor's Counsel: Buddy D. Ford
(Buddy@tampaesq.com)
115 N. MacDill Avenue
Tampa, FL 33609-1521
Telephone (813) 877-4669
Fax (813) 877-5543
Total Assets: $1,203,507
Total Debts: $1,443,551
A copy of Debtors' petition and a list of their 4 largest creditor
is available for free at:
http://bankrupt.com/misc/flmb08-12239
TAITRON COMPONENTS: Has Until Feb. 9 to Comply with Bid Price Rule
------------------------------------------------------------------
Taitron Components Incorporated received written notification from
NASDAQ that for the last 30 consecutive business days, the bid
price of the company's Class A common stock has closed below the
minimum $1.00 per share requirement for continued inclusion under
Marketplace Rule 4310(c)(4). Therefore, in accordance with
Marketplace Rule 4310(c)(8)(D), the company will be provided
180 calendar days, or until Feb. 9, 2009, to regain compliance
with respect to the bid price deficiency. If, at any time before
Feb. 9, 2009, the bid price of the company's common stock closes
at $1.00 per share or more for a minimum of 10 consecutive
business days, the bid price deficiency can be satisfied. The
company intends to monitor the bid price for its common stock
between now and Feb. 9, 2009, and will consider available options.
If compliance with this Rule cannot be demonstrated by Feb. 9,
2009, NASDAQ staff expects to determine whether the company meets
The NASDAQ Capital Market initial listing criteria as set forth in
Marketplace Rule 4310(c), except for the bid price requirement.
If determined to meet the initial listing criteria, NASDAQ expects
to notify the company that it has been granted an additional 180
calendar day compliance period until Aug. 8, 2009.
If the company is not eligible for an additional compliance
period, NASDAQ expects to provide written notification that the
company's securities will be delisted. At that time, the company
may appeal NASDAQ's determination to delist its securities to a
Listing Qualifications Panel.
About Taitron Components Inc.
Headquartered in Valencia, California, Taitron Components Inc.
(NASDAQ:TAIT) -- http://www.taitroncomponents.com/-- distributes
a variety of transistors, diodes and other semiconductors,
optoelectronic devices and passive components to electronic
distributors, contract electronic manufacturers and original
equipment manufacturers, who incorporate them into their products.
In addition, since 2003, Taitron has developed a market for value-
added engineering and turn-key services for our existing OEM and
CEM customers and providing them with original design and
manufacturing services for their multi-year turn-key projects.
TRIPLE CROWN: S&P Cuts 2nd-Lien Term Loan Rating to 'CCC-'
----------------------------------------------------------
Standard & Poor's Ratings Services lowered its issue-level rating
on Triple Crown Media LLC's second-lien senior secured term loan
to 'CCC-' (two notches lower than the 'CCC+' corporate credit
rating on the company) from 'CCC+'. The recovery rating on this
loan was revised to '6', indicating the expectation for negligible
(0% to 10%) recovery in the event of a payment default, from '4'.
The rating changes reflect the lowering of S&P's assumed emergence
multiple to 5x from 6x, due to the sustained deterioration of the
operating environment in the newspaper sector and the firm's
concern that the number of potential buyers is increasingly
limited.
All other existing ratings on the company remain unchanged. The
corporate credit rating is 'CCC+' and the rating outlook remains
negative. The 'CCC+' rating reflects the Lexington, Ky.-
headquartered newspaper publisher's high debt levels and limited
cushion in bank covenants. (For the latest complete corporate
credit rating rationale, see Standard & Poor's research report on
Triple Crown Media published Feb. 27, 2008.)
Ratings List
Triple Crown Media LLC
Corporate Credit Rating CCC+/Negative/--
Revised Ratings
To From
Triple Crown Media LLC
Second-Lien Term Loan CCC- CCC+
Recovery Rating 6 4
TROPICANA ENT: Court Moves Excl. Plan Filing Period to January 12
-----------------------------------------------------------------
Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District
of Delaware has extended the exclusive period for Tropicana
Entertainment LLC and its debtor-affiliate to file a
reorganization plan through and including Jan. 12, 2009, and the
exclusive period for them to solicit votes to accept that plan
through and including March 13, 2009.
As reported in the Troubled Company Reporter on Aug 5, 2008, the
Debtors stated these extensions will ensure that the formulated
plan takes into account their interests and the interests of their
employees and creditors, according to Mark D. Collins, Esq., at
Richards, Layton & Finger, P.A., in Wilmington, Delaware.
Mr. Collins maintained that the Debtors' extension will not
prejudice creditors.
Based in Crestview Hills, Kentucky, Tropicana Entertainment LLC --
http://www.tropicanacasinos.com/-- is an indirect subsidiary of
Tropicana Casinos and Resorts. The company is one of the largest
privately-held gaming entertainment providers in the United
States. Tropicana Entertainment owns eleven casino properties in
eight distinct gaming markets with premier properties in Las
Vegas, Nevada and Atlantic City, New Jersey.
Tropicana Entertainment LLC filed for Chapter 11 protection on
May 5, 2008, (Bankr. D. Del. Case No. 08-10856). Its debtor-
affiliates filed for separate Chapter 11 petitions but with no
case numbers assigned yet. Kirkland & Ellis LLP and Mark D.
Collins, Esq., at Richards Layton & Finger, represent the Debtors
in their restructuring efforts. Their financial advisor is Lazard
Ltd. Their notice, claims, and balloting agent is Kurtzman Carson
Consultants LLC. Epiq Bankruptcy Solutions LLC is the Debtors'
Web site administration agent. AlixPartners LLP is the Debtors'
restructuring advisor.
Stroock & Stroock & Lavan LLP and Morris Nichols Arsht & Tunnell
LLP represent the Official Committee of Unsecured Creditors in
this case. Capstone Advisory Group LLC is financial advisor to
the Creditors' Committee.
The Debtors' exclusive plan filing period expires on Sept. 2,
2008.
(Tropicana Bankruptcy News, Issue No. 13; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)
TROPICANA ENT: Can Assume or Reject Unexpired Leases Until Dec. 1
-----------------------------------------------------------------
Judge Kevin. J. Carey of the the U.S. Bankruptcy Court for the
District of Delaware has extended the deadline by which Tropicana
Entertainment LLC and its debtor-affiliates must assume or reject
unexpired non-residential real property leases, through and
including Dec. 1, 2008.
As reported in the Troubled Company Reporter on Aug 5, 2008, the
Debtors maintained that the Unexpired Leases are critical assets
of their estates and key to their successful reorganization.
Mark D. Collins, Esq., at Richards Layton & Finger P.A., in
Wilmington, Delaware. stated that if the Debtors determined that
the sale of a casino property is in the best interest of
their estates, one or more of the Unexpired Leases will be an
important asset to that transaction.
Mr. Collins assured the Court that the Debtors are paying, and
will continue to pay, for the postpetition rent obligations of the
Unexpired Leases. He asserted that pending the Debtors' decision
to assume or reject the Unexpired Leases, the Debtors are
performing their obligations arising from and after the Petition
Date in a timely manner, to the extent required by Section
365(d)(3). There is no reason why the Debtors' proposed extension
of the lease decision deadline could or would unduly prejudice the
lessors of the Unexpired Leases, he pointed out.
The Debtors said they will evaluate the economics of each
Unexpired Lease, in light of their developing business plan and
the eventual plan of reorganization, to determine whether the
assumption or rejection of each of the Unexpired Leases would
inure to the benefit of their estates.
About Tropicana Entertainment
Based in Crestview Hills, Kentucky, Tropicana Entertainment LLC --
http://www.tropicanacasinos.com/-- is an indirect subsidiary of
Tropicana Casinos and Resorts. The company is one of the largest
privately-held gaming entertainment providers in the United
States. Tropicana Entertainment owns eleven casino properties in
eight distinct gaming markets with premier properties in Las
Vegas, Nevada and Atlantic City, New Jersey.
Tropicana Entertainment LLC filed for Chapter 11 protection on
May 5, 2008, (Bankr. D. Del. Case No. 08-10856). Its debtor-
affiliates filed for separate Chapter 11 petitions but with no
case numbers assigned yet. Kirkland & Ellis LLP and Mark D.
Collins, Esq., at Richards Layton & Finger, represent the Debtors
in their restructuring efforts. Their financial advisor is Lazard
Ltd. Their notice, claims, and balloting agent is Kurtzman Carson
Consultants LLC. Epiq Bankruptcy Solutions LLC is the Debtors'
Web site administration agent. AlixPartners LLP is the Debtors'
restructuring advisor.
Stroock & Stroock & Lavan LLP and Morris Nichols Arsht & Tunnell
LLP represent the Official Committee of Unsecured Creditors in
this case. Capstone Advisory Group LLC is financial advisor to
the Creditors' Committee.
The Debtors' exclusive plan filing period expires on Sept. 2,
2008.
(Tropicana Bankruptcy News, Issue No. 13; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)
US AIRWAYS: Prices Public Offering of 19MM Shares of Common Stock
-----------------------------------------------------------------
US Airways Group Inc. priced its public offering of 19.00 million
shares of common stock at an offering price of $8.50 per share for
net proceeds, after the underwriting discount and estimated
offering expenses, of approximately $155 million.
The company also disclosed that the underwriter of its public
offering has exercised in full the over-allotment option granted
to it by the company. As a result, the company will sell an
additional 2.850 million shares of its common stock at the
offering price of $8.50 per share.
Including the exercise of the over-allotment option, the net
proceeds from the offering, after deducting underwriting discounts
and commissions, are expected to be approximately $179 million.
The company plans to use the net proceeds for general corporate
purposes. Completion of the offering is subject to customary
closing conditions and is expected to close on Aug. 19, 2008.
Merrill Lynch & Co. acted as the sole book-running manager for the
offering.
The shares of common stock are being offered under the company's
existing shelf registration statement, which became automatically
effective upon filing with the Securities and Exchange Commission.
The offering may be made only by means of a prospectus and a
related prospectus supplement, copies of which may be obtained
from:
Merrill Lynch & Co.
4 World Financial Center
250 Vesey St.
New York, NY 10080
Tel (212) 449-1000
About US Airways
Based in Tempe, Arizona, US Airways Group Inc.'s (NYSE: LCC) -
http://www.usairways.com/-- primary business activity is the
ownership of the common stock of US Airways, Inc., Allegheny
Airlines, Inc., Piedmont Airlines, Inc., PSA Airlines, Inc.,
MidAtlantic Airways, Inc., US Airways Leasing and Sales, Inc.,
Material Services company, Inc., and Airways Assurance Limited,
LLC.
Under a Chapter 11 plan declared effective on March 31, 2003,
USAir emerged from bankruptcy with the Retirement Systems of
Alabama taking a 40% equity stake in the deleveraged carrier in
exchange for $240 million infusion of new capital.
US Airways and its subsidiaries filed another chapter 11 petition
on Sept. 12, 2004 (Bankr. E.D. Va. Case No. 04-13820). Brian P.
Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning, Esq.,
at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and Douglas
M. Foley, Esq., at McGuireWoods LLP, represent the Debtors in
their restructuring efforts. In the company's second bankruptcy
filing, it lists $8,805,972,000 in total assets and $8,702,437,000
in total debts.
The Debtors' Chapter 11 plan for its second bankruptcy filing
became effective on Sept. 27, 2005. The Debtors completed their
merger with America West on the same date.
* * *
As reported in the Troubled company Reporter on July 24, 2008,
Moody's Investors Service downgraded the Corporate Family and
Probability of Default Ratings of US Airways Group Inc. to Caa1
from B3 and lowered the ratings of its outstanding corporate debt
instruments and certain Enhanced Equipment Trust Certificates
(EETC). Moody's lowered the Speculative Grade Liquidity
Assessment to SGL-4 from SGL-3. The rating outlook is negative.
VERTIS COMMUNICATIONS: June 30 Balance Sheet Upside-Down by $956MM
------------------------------------------------------------------
Vertis Communications' balance sheet at June 30, 2008, showed
total assets of $508.9 million and total liabilities of
$1.4 billion, resulting in stockholder's deficit of
$956.8 million.
The company also reported results for the three and six months
ended June 30, 2008.
Net loss during the second quarter of 2008 was $40.9 million
compared to a $19.7 million net loss in the second quarter of
2007. Through June 30, 2008, the net loss amounted to
$81.8 million versus $44.9 million in the corresponding period in
2007.
The drivers in the loss for the quarter are fees associated with
the financial restructuring of the company of $12.5 million,
increases in operational restructuring costs of $0.9 million and
the impacts of the decline in volumes noted above. On a year-to-
date basis the fees related to its financial restructuring
amounted to $16.8 million and increases in operational
restructuring costs amounted to $7.6 million. Through the first
half of the year, expected volume declines in Advertising Inserts,
partially offset by improved pricing, combined with the impact of
reduced revenue in the Direct Mail segment to contribute to the
loss. The company continued its investment in lean and continuous
improvement aimed at improving productivity and performance as
well as upgrading quality and customer service which resulted in
some near term increased costs.
The benefits of these actions are reflected in cost of production.
Additionally, the company is focusing on improving its sales
organization by adding new sales resources.
The company ended the quarter with $1.5 million in cash and debt
of $1,192.1 million. In addition, the off-balance sheet accounts
receivable facility stood at $80.1 million. The company ended the
quarter with $20.6 million available under its $250 million senior
credit facility.
About Vertis Communications
Vertis Inc. dba Vertis Communications -- http://www.vertisinc.com/
-- is a provider of print advertising and direct marketing
solutions to America's retail and consumer services companies.
Going Concern Doubt
Deloitte & Touche LLP, in Baltimore, Maryland, expressed
substantial doubt about Vertis Inc.'s ability to continue as a
going concern after auditing the company's consolidated financial
statements for the years ended Dec. 31, 2007, and 2006. The
auditing firm said that the company has incurred recurring net
losses and is experiencing difficulty in generating sufficient
cash flow to meet its obligations and sustain its operations.
* * *
As reported in the Troubled Company Reporter on May 29, 2008,
Moody's Investors Service has affirmed the Ca corporate family
rating for Vertis Inc., while changing the probability of default
rating to Ca from Ca/LD, after the company's statement of a
merger with American Color Graphics Inc. coupled with a
comprehensive restructuring plan.
VERTIS HOLDINGS: Wants Lazard Freres as Financial Advisors
----------------------------------------------------------
Vertis Holdings, Inc., and its debtor affiliates seek authority
from the U.S. Bankruptcy Court for the District of Delaware to
employ Lazard Freres & Co. LLC, as their financial advisors.
The Debtors assert that as capable and experienced financial
advisors, Lazard's retention in their Chapter 11 cases is crucial
to their successful restructuring.
The Debtors and Lazard entered into an engagement letter dated
March 21, 2008, for the terms of the firm's employment. As the
Vertis Debtors' financial advisors, Lazard is expected to:
(a) evaluate the Debtors' potential debt capacity in light of
their projected cash flows;
(b) assist in determining a capital structure for the Debtors;
(c) assist in the determination of a range of values for the
Debtors on a going-concern basis;
(d) render financial advice to the Debtors and participate in
meetings or negotiations with stakeholders, rating agencies
or other parties with respect to the Debtors'
restructuring;
(e) advise the Debtors on the timing, nature and terms of new
securities, other consideration or other inducements to be
offered;
(f) assist the Debtors in identifying and evaluating
candidates for potential sale transactions, advise the
Debtors in negotiations, and aid in the consummation of a
Transaction;
(g) advise and assist the Debtors in evaluating and obtaining
potential financing, including debtor-in-possession
financing; contacting potential sources of capital as the
Debtors may designate; and assisting them in implementing
the Financing; and
(h) provide testimony, as necessary, with respect to matters
on which Lazard has been engaged to advise the Debtors in
any proceeding.
In exchange for the services it is expected to render, Lazard
will receive:
* a monthly fee of $175,000, payable on March 15, 2008, and on
the succeeding months until the earlier of (i) the
completion of a Restructuring, or (ii) the termination of
the firm's engagement with the Vertis Debtors;
* a restructuring fee, amounting to:
(x) $6,500,000 for a Restructuring completed outside of
the Court,
(y) $6,000,000 for a Restructuring through a prepackaged
or pre-arranged case, or
(z) $5,000,000 for a Restructuring completed by other
means;
* a sale transaction fee in connection with the sale of a
majority of the Debtors' assets, which may be paid as equal
to the greater of (i) the fee calculated based on the
Lazard's Engagement Agreement with the Debtors, or (ii) the
applicable Restructuring Fee, provided that a Sale
Transaction involving American Color Graphics, Inc., and its
affiliates will cap the Sale Transaction Fee at $2,000,000;
* a monthly sale transaction fee based on the aggregate
consideration in a sale transaction involving a minority of
the Debtors' assets;
* a testimony fee of $500,000, if Lazard is required to
testify before the Court; and
* a DIP Financing fee equal to $500,000, which will be payable
upon the consummation of the Debtors' DIP Financing, and will
be credited against any Restructuring or Majority Sale
Transaction Fee.
Lazard will also be reimbursed of its reasonable and out-of-
pocket expenses of up to $250,000. The firm has agreed not to
share any of the compensation they will receive from the Debtors
in accordance with Section 504 of the Bankruptcy Code, Mr. Howard
adds.
As Lazard is not entitled to any hourly compensation under the
Engagement Agreement, the Debtors will require the firm to submit
time records in a summary format and apply to the Court for
payment of fees and reimbursement of expenses.
Lazard relates it will coordinate with the Debtors' other retained
advisors, including FTI Consulting, Inc., and Alvarez & Marsal
North America, LLC, to avoid duplication of their work.
The Debtors also agree to indemnify and hold harmless Lazard and
its affiliates of any loss, claim or damage or liability that
arises of the Vertis Debtors' bad faith, gross negligence or
willful misconduct.
David S. Kurtz, a managing director of Lazard, discloses that his
firm is a "disinterested person" as that term is defined under
Section 101(14) of the Bankruptcy Code.
About Vertis Holdings Inc.
Headquartered in Baltimore, Maryland, Vertis Holdings, Inc. --
http://www.vertisinc.com/-- is a provider of targeted print
advertising and direct marketing solutions to America's retail and
consumer services companies.
The company and its six affiliates filed for Chapter 11 protection
on July 15, 2008 (Bank.D.Del. Case No. 08-11460). Gary T.
Holtzer, Esq. and Stephen A. Youngman, Esq. at Weil, Gotshal &
Manges LLP represent as the Debtors lead counsels and Mark D.
Collins, Esq. and Michael Joseph Merchant, Esq. at Richards Layton
& Finger, P.A. represent as their Delaware local counsels. Lazard
Freres & Co. LLC is the company's financial advisors. When the
Debtors filed for protection from their creditors they listed
estimated assets between $500 million and $1 billion and estimated
debts of more than 1 billion.
VERTIS HOLDINGS: Taps DLA Piper as Special Corporate Counsel
------------------------------------------------------------
Vertis Holdings, Inc., and its debtor affiliates seek the U.S.
Bankruptcy Court for the District of Delaware's permission to
employ DLA Piper US LLP as their special corporate counsel nunc
pro tunc to July 15, 2008.
John V. Howard, Jr., secretary of Vertis Holdings, Inc., tells
the Court that due to DLA Piper's prior and continuing general
corporate and transactional work for the Debtors, the firm is
knowledgeable with the Debtors' businesses.
Pursuant to the Engagement Letter the parties entered into for
the employment of DLA Piper, the firm is contemplated to continue
to represent and provide legal advice to the Debtors in connection
with, among other things:
(a) general corporate transactions;
(b) the coordination with the Debtors' general bankruptcy
counsel, non-bankruptcy related legal matters arising in
or relating to the Debtors' ordinary course of business,
including attendance at senior management meetings,
meeting with the Debtors' advisors and meetings with
Vertis' Board of Directors and any other matters that the
Debtors deem appropriate;
(c) any necessary consultation with the Debtors' bankruptcy
counsel, as needed, regarding issues arising in connection
with postpetition transactions;
(d) additional services within the area of corporate, certain
litigation and related matters that may arise in
connection with these Chapter 11 cases;
(e) the proposed merger with the ACG Debtors, including
acquisition-related, employment, due diligence, tax, HSR
and antitrust advice with respect to the transaction;
(f) securities, disclosure and reporting matters relating to
the potential merger with the ACG Debtors, Vertis' ongoing
SEC reporting obligations, and Vertis' discussions and
negotiations with its bondholders, other creditors and
equity holders;
(g) legal opinions and advice in connection with a
restructuring of the Vertis Debtors' equity and debt
capitalization;
(h) advice and counsel on labor and employment matters
litigation, including actions to enforce certain
restrictive covenants;
(i) asset acquisitions and dispositions of assets; and
(j) general corporate, governance, contract and business
matters.
DLA Piper professionals R.W. Smith, Jr., Jason C. Harmon, Linda
M. Thomas, Mark A. Berkoff and William Choslovsky are expected to
represent the Vertis Debtors in connection with the contemplated
services.
According to Mr. Howard, DLA Piper received prepetition advance
payments for professional services performed amounting to
$1,295,678, and expenses incurred and to be incurred totaling
$12,091. As of July 15, 2008, DLA Piper has a remaining credit
balance amounting to $60,000.
DLA Piper notes its current hourly rates for legal assistants and
lawyers range from $80 to $975 per hour. The firm will be paid
for its services according to these hourly rates:
Professional Hourly Rate
------------ ----------
Mark A. Berkoff $725
R.W. Smith, Jr. $780
William Choslovsky $620
Jason C. Harmon $585
Linda M. Thomas $630
The firm also charges its clients for actual and necessary
expenses incurred, including telephone, telecopier, mails,
delivery, document processing, and meals expenses.
Mark A. Berkoff, Esq., a DLA Piper partner, assures the Court
that DLA Piper is a "disinterested person" as the term is defined
in Section 101(14) of the Bankruptcy Code, as modified by Section
1107(b).
About Vertis Holdings Inc.
Headquartered in Baltimore, Maryland, Vertis Holdings, Inc. --
http://www.vertisinc.com/-- is a provider of targeted print
advertising and direct marketing solutions to America's retail and
consumer services companies.
The company and its six affiliates filed for Chapter 11 protection
on July 15, 2008 (Bank.D.Del. Case No. 08-11460). Gary T.
Holtzer, Esq. and Stephen A. Youngman, Esq. at Weil, Gotshal &
Manges LLP represent as the Debtors lead counsels and Mark D.
Collins, Esq. and Michael Joseph Merchant, Esq. at Richards Layton
& Finger, P.A. represent as their Delaware local counsels. Lazard
Freres & Co. LLC is the company's financial advisors. When the
Debtors filed for protection from their creditors they listed
estimated assets between $500 million and $1 billion and estimated
debts of more than 1 billion.
VERTUE INC: S&P Affirms 'B' Corporate Credit Rating; Outlook Neg
----------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Norwalk,
Conn.-based Vertrue Inc. to negative from stable. S&P also
affirmed the ratings, including the 'B' corporate credit rating,
on the company. Total debt outstanding as of June 30, 2008, was
$652.2 million.
"The outlook revision is based on weak operating performance in
two of the company's four operating segments and a reassessment of
the company's business risk profile—specifically our concern
about management's execution," said Standard & Poor's credit
analyst Hal F. Diamond. The potential for a thinner margin of
covenant compliance if operating performance continues to
deteriorate is another factor in the change of outlook.
VICORP RESTAURANTS: Has Until Oct. 30 to File Chapter 11 Plan
-------------------------------------------------------------
The United States Bankruptcy Court for the District of Delaware
extended the exclusive period of VICORP Restaurants Inc. and its
debtor-affiliate, VI Acquisition Corp., to file their Chapter 11
plan and to solicit acceptance of the plan to October 30, 2008 and
to December 28, 2008, respectively.
The Debtors ask the Court for an extension of the Exclusive Filing
and Solicitation Periods to be enable them to formulate a Plan
that fairly and efficiently treats their creditors and to present
their conclusions to the various creditor constituencies in the
expectation of developing consensus.
Based in Denver, Colorado, VICORP Restaurants Inc. --
http://www.vicorpinc.com/-- operates two restaurant concepts
under proven and well-recognized brands, Village Inn and Bakers
Square. Founded in 1958, VICORP has 343 restaurants in 25 states,
consisting of 250 company-operated restaurants and 93 franchised
restaurants. Known for its strong breakfast heritage, Village Inn
has been serving its signature breakfast items like one-of-a-kind
skillet dishes and made-from-scratch pancakes for 50 years. In
addition, Village Inn offers traditional American fare for lunch
and dinner.
The company and its affiliates filed for Chapter 11 protection on
April 3, 2008 (Bankr. D. Del. Lead Case No. 08-10623). Donna L.
Culver, Esq., at Morris Nichols Arsht & Tunnell, and Kimberly
Ellen Connolly Lawson, Esq., Kurt F. Gwynne, Esq., and Richard A.
Robinson, Esq., at Reed Smith LLP, represents the Debtors in their
restructuring efforts. The Debtors selected The Garden City
Group, Inc. as their claims agent. Abhilash M. Raval, Esq.,
Dennis Dunne, Esq., and Samuel Khalil, Esq., at Milbank Tweed
Hadley & McCloy LLP, represent the Committee in these case.
When the Debtors filed for protection from their creditors, they
listed estimated assets of $100 million to $500 million and debts
of $100 million to $500 million.
WALDEN RESERVE: Wants to Borrow $300,000 PostPetition Debt
----------------------------------------------------------
Walden Reserve, LLC asked permission from the U.S. Bankruptcy
Court for the District of Kansas to access $300,000 in
postpetition debt.
The Debtor intends to use the fund to pay real estate tax
obligations, ongoing payments to the U.S. Trustee, attorney and
accountant fees, office lease payments, insurance and other
regular ongoing expenses.
The Debtor issued series 2008 promissory note and deed of trust.
Under the 2008 note, the Debtor promised to pay to the order of
________, the sum of $30,000, together with interest of 8%
annually for a term of two years from the date of issue. An 8%
interest will be paid on the one year anniversary of the note and
8% interest along with the principal of $30,000 will be paid on
the second year. Holder of the note will have the option to
convert it into an equity interest of one membership unit in
Walden Reserve prior to its redemption or full payment. The
Debtor, at its option, may redeem, in whole at any time, the note
or other series 2008 8% convertible notes by full payment plus
accrued interest.
The Debtor as guarantor, under the deed of trust, has bargained,
sold and conveyed to A. Wayne Henry, trustee of 322 Grove Street
in Loudon County, Tennessee a property in Cumberland County,
Tennessee.
U.S. Trustee and Committee Objects
A. United States Trustee
U.S. Trustee, Richard A. Wieland, through his attorney, David P.
Eron, Esq., told the Court that the Debtor did not specify its
lenders in its motion to borrow postpetition debt. The U.S.
Trustee said that there was no budget attached to the application,
or any other itemization of how the funds would be used.
The U.S. Trustee noted that the Debtor said in its motion that it
is in the business of developing and operating environmentally
sensitive and sustainable real estate development. More
accurately, the Debtor's business during its entire existence has
consisted exclusively of the purchase of and developmental
planning for a single 6,000 acre plot of land in mountainous,
rural Tennessee. According to the U.S. Trustee, during the
section 341 meeting of creditors, the Debtor's principal, Thomas
Bray, testified that no tangible work has ever been done to the
property. The Debtor has not generated any income to date from
the real property, the U.S. Trustee asserted.
The Debtor has no prospect for successful reorganization, the U.S.
Trustee stated. Mr. Bray testified during the meeting of
creditors that it would take an additional $50,000,000 of capital
and six full years of development before Debtor would be able to
turn a profit. That amount of time and money would allow the
Debtor to complete "Phase 1" of a five-phase planned development.
The Debtor's appraisal estimates that the current value its real
property is $14,600,000 and that the value of the Debtor's real
property after the completion of Phase 1 would be $60,000,000.
That is an increase of $45,400,000 in value. If the numbers on
Debtor's appraisal were correct, that would result in a loss of
almost $5,000,000, plus $10,000,000 interest on the loan.
The U.S. Trustee added that the Debtor's management has already
proved that it cannot handle the task of reorganization. The
Debtor has spent money at an alarming rate, almost $8,000,000 in
total debt and millions more in equity capital investments. Yet
the real property itself was purchased for only $3,000,000, and no
tangible work has been done to the real property.
Having already spent somewhere near $10,000,000, the Debtor must
spend five times that amount again in order to reach
profitability, the U.S. Trustee pointed.
The U.S. Trustee said that the Debtor's estimate of its property
at $14,600,000 in its schedules is overvalued and its not very
trustworthy. According to the U.S. Trustee, the Debtor's property
is probably worth between $4,000,000 and $12,000,000.
B. Creditors' Committee
The Official Committee of Unsecured Creditors told the Court that
it has only recently hired counsel.
The Committee said that it is unaware whether there is an
itemization of the proposed uses of the funds or any budget
provided to the U.S. Trustee or the Court. Without those
information, the Committee asserted that it is impossible to
analyze whether the expenses and the requested financing is
necessary or appropriate.
The Court is set to hear the Debtor's motion to borrow
postpetition debt and related objections today, Aug. 19, 2008, at
9:30 a.m.
About Walden Reserve
Based in Overland Park, Kan., Walden Reserve, LLC, formerly doing
business as Renegade Mountain Partners LLC, owns and manages
residential real estate. The Debtor filed for chapter 11
protection on May 28, 2008 (D. Kan. Case No. 08-21230).
Colin N. Gotham, Esq., at Evans & Mullinix, P.A., represents the
Debtor in its restructuring efforts. When the Debtor filed for
bankruptcy, it listed total assets of $14,637,288 and total debts
of $7,085,320.
An Official Committee of Unsecured Creditors has been appointed in
this case. Scott J. Goldstein, Esq., at Spencer, Fane, Britt &
Browne LLP is the proposed counsel for the Creditors' Committee.
WALDEN RESERVE: U.S. Trustee Names Eight Creditors to Committee
---------------------------------------------------------------
The United States Trustee for Region 20 appointed eight creditors
as members of the Official Committee of Unsecured Creditors in the
chapter 11 case of Walden Reserve, LLC
The members of the Committee are:
1. Kul Razdan
Techknow Engineering LLC
30 East Adams Street, #1100
Chicago, IL 60603
Tel: 312-345-1009
2. Paul Weigel
Berkebile Nelson Immenschuh McDowell Inc
106 West 14th Street, Suite 200
Kansas City, MO 64105
Tel: 816-783-1500
3. Neil Dawson
Dawson Wissmach Architects
12 East Bay Street
Savannah, GA 31401
Tel: 912-201-0111
4. W. Scott Parker
Design Works LC
50 George Street
Charleston, SC 29401
Tel: 843-723-5525
5. Robert Donovan
Bedford Falls Development LLC
50 Ford Way
Richmond Hill, GA 31324
Tel: 912-429-4813
6. Anna Aniko Kurczinak
AKD LLC
480 Gate Five Road, Studio 109A
Sausalito, CA 94965
Tel: 415-331-1224
7. Mark Buchanan
Stonecreek Studio Inc.
111 Center Park Drive
Knoxville, TN 37922
Tel: 865-691-3033
8. Scott J. Goldstein
Spencer Fane Britt & Browne LL
1000 Walnut, Suite 1400
Kansas City, MO 64106
Tel: 816-474-8100
Official creditors' committees have the right to employ legal
and accounting professionals and financial advisors, at the
Debtors' expense. They may investigate the Debtors' business and
financial affairs. Importantly, official committees serve as
fiduciaries to the general population of creditors they represent.
Those committees will also attempt to negotiate the terms of a
consensual Chapter 11 plan -- almost always subject to the terms
of strict confidentiality agreements with the Debtors and other
core parties-in-interest. If negotiations break down, the
Committee may ask the Bankruptcy Court to replace management with
an independent trustee. If the Committee concludes reorganization
of the Debtor is impossible, the Committee will urge the
Bankruptcy Court to convert the Chapter 11 cases to a liquidation
proceeding.
About Walden Reserve
Based in Overland Park, Kan., Walden Reserve, LLC, formerly doing
business as Renegade Mountain Partners LLC, owns and manages
residential real estate. The Debtor filed for chapter 11
protection on May 28, 2008 (D. Kan. Case No. 08-21230).
Colin N. Gotham, Esq., at Evans & Mullinix, P.A., represents the
Debtor in its restructuring efforts. When the Debtor filed for
bankruptcy, it listed total assets of $14,637,288 and total debts
of $7,085,320.
An Official Committee of Unsecured Creditors has been appointed in
this case. Scott J. Goldstein, Esq., at Spencer, Fane, Britt &
Browne LLP is the proposed counsel for the Creditors' Committee.
WALDEN RESERVE: Gets Nod to Employ Evans & Mullinix as Counsel
--------------------------------------------------------------
Walden Reserve, LLC obtained permission from the U.S. Bankruptcy
Court for the District of Kansas to employ Evans & Mullinix, P.A.
as its bankruptcy counsel.
The Court ordered that the Debtors will, from the assets of the
bankruptcy estate, pay each month to Evans & Mullinix 100% of the
fees incurred and the expenses advanced on behalf of the Debtors.
Evans & Mullinix may apply 100% of payment for costs advanced and
80% for fees billed and shall hold in its trust account 20% of the
for fees billed.
Also, based on the order, the balance and the entire amount of
fees paid will be subject to approval of the court upon
application by the attorneys for Debtors.
The Court further ordered that Evans & Mullinix will exhaust a
retainer before the Debtors are required to directly pay the firm
the sums owed on the monthly billing statements.
The Troubled Company Reporter said on July 3, 2008, that Colin N.
Gothan, Esq., Joanne B. Stutz, Esq., Richard C. Wallace, Esq.,
Thomas M. Mullinix, Esq., all of the firm of Evans & Mullinix
assure the Court that the firm does not hold or represent any
interest adverse to the Debtor or its estate and the the firm is a
"disinterested person" as that term is defined in Sec. 101(14) of
the bankruptcy code.
The firm's professionals bills at these rates:
Thomas M. Mullinix, Esq. $300
Richard C. Wallace, Esq. $300
Joanne B. Stutz, Esq. $300
Colin N. Gotham, Esq. $200
Paralegals $75
The firm has received a $25,000 retainer less the filing fee of
$1,039. Additionally, on May 28, 2008, the Debtor paid the firm
$5,000 for services rendered in preparing for the Chapter 11
filing, including but not limited to preparation of the bankruptcy
petition, schedules and other documents required to be filed in
the Debtor's bankruptcy case.
About Walden Reserve
Based in Overland Park, Kan., Walden Reserve, LLC, formerly doing
business as Renegade Mountain Partners LLC, owns and manages
residential real estate. The Debtor filed for chapter 11
protection on May 28, 2008 (D. Kan. Case No. 08-21230).
Colin N. Gotham, Esq., at Evans & Mullinix, P.A., represents the
Debtor in its restructuring efforts. When the Debtor filed for
bankruptcy, it listed total assets of $14,637,288 and total debts
of $7,085,320.
An Official Committee of Unsecured Creditors has been appointed in
this case. Scott J. Goldstein, Esq., at Spencer, Fane, Britt &
Browne LLP is the proposed counsel for the Creditors' Committee.
WALDEN RESERVE: Wants Lattimore Black as Consultant and Accountant
------------------------------------------------------------------
Walden Reserve, LLC asked permission from the U.S. Bankruptcy
Court for the District of Kansas to employ Lattimore Black Morgan
& Cain, P.C., as its financial consultant and accountant.
The Debtor related to the Court that Lattimore is well qualified
to provide the necessary services.
The fee scheduled for the firm is:
Partner $250 - $295
Senior Manager $185 - $225
Manager $165 - $195
Supervising Senior $125 - $165
Senior $120 - $130
Staff $95 - $115
The Debtor will, from the bankruptcy estate, pay Lattimore each
month 100% of the fees incurred and of the expenses advanced on
behalf of the Debtor.
No retainer has been paid to Lattimore. Lattimore has previously
provided services to the Debtor but has agreed to subordinate its
claim to the Debtor's unsecured creditors and will not seek
payment from the Debtor for prepetition balance until the
unsecured creditors are paid in full.
The firm can be reached at:
J. Daniel Pressley
Lattimore Black Morgan & Cain, P.C.
10024 Investment Drive, Suite 200
Knoxville, TN 37932
Creditors' Committee Opposes Engagement
The Official Committee of Unsecured Creditors noted that the
Debtor sought to employ Lattimore as a financial consultant to
prepare the federal and any state tax returns and supporting
schedules necessary. The Committee said that the Debtor's motion
to employ Lattimore failed to state the scope of Lattimore's
employment, including for what years it is preparing tax returns.
It also failed to state with any specificity what Lattimore will
do in its capacity as financial consultant versus accountant, the
Committee asserted.
Further, Lattimore will spend a significant amount of time on the
case, the Committee noted the Debtor's motion to employ.
According to the Committee, the Debtor must explain what it means
by that statement.
As a prepetition creditor, Lattimore is conflicted from the
engagement, the Committee said. A professional typically waives
its prepetition claim. The Committee said it reserves the right
to object to the substance of any prepetition claim that Lattimore
may file.
The Committee added that the Debtor has shown no reason why it
needs an accountant in Tennessee as opposed to a local accountant.
The Court is set to hear the Debtor's motion related to the
objection today, Aug. 19, 2008, at 9:30 a.m.
About Walden Reserve
Based in Overland Park, Kan., Walden Reserve, LLC, formerly doing
business as Renegade Mountain Partners LLC, owns and manages
residential real estate. The Debtor filed for chapter 11
protection on May 28, 2008 (D. Kan. Case No. 08-21230).
Colin N. Gotham, Esq., at Evans & Mullinix, P.A., represents the
Debtor in its restructuring efforts. When the Debtor filed for
bankruptcy, it listed total assets of $14,637,288 and total debts
of $7,085,320.
An Official Committee of Unsecured Creditors has been appointed in
this case. Scott J. Goldstein, Esq., at Spencer, Fane, Britt &
Browne LLP is the proposed counsel for the Creditors' Committee.
WELLMAN INC: Court Approves Panel's Third Stipulation with Lenders
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved a stipulation among Wellman Inc. and its debtor-
affiliates, Deutsche Bank Trust Company Americas, Bank of New
York, Wilmington Trust Company and the Official Committee of
Unsecured Creditors, giving them additional time to resolve the
issues raised by the panel.
The Creditors Committee previously urged the Court to issue a
ruling recognizing that the automatic stay was vacated by consent
of the Debtors on the petition date. The panel also sought
approval to investigate the Debtors regarding a refinancing
transaction in 2004, which resulted in the Debtors' accumulating
secured debt.
The stipulation dated July 31, 2008, requires the parties to
follow this timetable:
Aug. 28 Deadline for filing objection to the Creditors
Committee's motion to lift the automatic stay
Set. 31 Deadline for filing objection to the Creditors
Committee's motion to investigate the Debtors
about the refinancing deal
Sept. 4 Hearing to consider the Creditors Committee's
motions
Sept. 14 Deadline for challenging the stipulations or
other provisions in the final order approving
the Debtors' bankruptcy loan
About Wellman
Headquartered in Fort Mill, South Carolina, Wellman Inc. ([OTC]:
WMANQ.OB) -- http://www.wellmaninc.com/-- manufactures and
markets packaging and engineering resins used in food and
beverage packaging, apparel, home furnishings and
automobiles. They manufacture resins and polyester staple fiber
a three major production facilities.
The company and its debtor-affiliates filed for Chapter 11
protection on Feb. 22, 2008 (Bankr. S.D. N.Y. Case No.
08-10595). Jonathan S. Henes, Esq., at Kirkland & Ellis, LLP,
in New York City, represents the Debtors. Lazard Freres & Co.,
LLC, acts as the Debtors' financial advisors and investment
bankers. Conway, Del Genio, Gries & Co., LLC, was also retained
as the Debtors' chief restructuring advisor.
The United States Trustee for Region 2 has appointed seven members
to the Official Committee of Unsecured Creditors. Mark R.
Somerstein, Esq., at Ropes & Gray LLP, serves as the Committee's
bankruptcy counsel. FTI Consulting, Inc., acts as the panel's
financial advisors.
Wellman Inc., in its bankruptcy petition, listed total assets
of $124,277,177 and total liabilities of $600,084,885, as of
Dec. 31, 2007, on a stand-alone basis. Debtor-affiliate ALG,
Inc., listed assets between $500 million and $1 billion on a
stand-alone basis at the time of the bankruptcy filing.
Debtor-affiliates Fiber Industries Inc., Prince Inc., and
Wellman of Mississippi Inc., listed assets between $100 million
and $500 million at the time of their bankruptcy filings.
On a consolidated basis, Wellman Inc., and its debtor-affiliates
listed $512,400,000 in total assets and $730,500,000 in
liabilities as of June 30, 2008.
Wellman filed a restructuring plan before the Bankruptcy Court on
June 25, 2008.
WESTMORELAND COAL: June 30 Balance Sheet Upside-Down by $192.3MM
-----------------------------------------------------------------
Westmoreland Coal Company reported Monday its financial results
for the second quarter ended June 30, 2008.
At June 30, 2008, the company's consolidated balance sheet showed
$795.7 million in total assets and $988.0 million in total
liabilities, resulting in a $192.3 million stockholders' deficit.
Net loss was $17.9 million for the quarter ended June 30, 2008,
compared to a net loss of $10.9 million for the quarter ended
June 30, 2007. Results were negatively impacted during second
quarter of 2008 by a $3.8 million loss on extinguishment of debt.
The second quarter of 2007 was negatively impacted by a
$2.3 million restructuring charge.
Other major differences between the second quarters of 2008 and
2007 were higher interest charges (net of interest income) in 2008
of $923,000 associated with the company's recent financing
activities, and a reduction in operating income in the coal
operations in 2008 of an estimated $1.7 million caused by a work
stoppage at the Absaloka Mine, an unscheduled customer outage and
higher fuel, depreciation and depletion costs at the company's
mining operations. Scheduled and unscheduled outages at the
Roanoke Valley (ROVA) power facility also negatively impacted the
second quarter of 2008.
Second quarter 2008 revenues decreased to $113.4 million compared
to second quarter 2007 revenues of $123.3 million, primarily
reflecting a $9.3 million, or 9.1%, decrease in coal revenues.
"In May of 2007, Westmoreland launched numerous restructuring
initiatives intended to support our strategic focus on our core
competency of coal," said Keith E. Alessi, Westmoreland's
executive chairman. "This led to the divestiture of non-core
businesses, the purchase of our partner's ownership interest in
the Absaloka Mine, the signing of a long-term, cost plus contract
at our Jewett mine, streamlining of reporting functions and a
significant reduction of corporate headcount.
"We completed the majority of these initiatives by the end of
2007, and then focused our attention on resolving our working
capital needs. The refinancing of two of our subsidiaries, as
well as the sale of senior secured convertible notes at the parent
company level, have resulted in an improvement of working capital
of $85.9 million since year end 2007. While this has put the
company on a much stronger financial footing, we will continue to
evaluate our long-term capital needs. The fact that we were able
to complete these financing transactions in a very difficult
credit market speaks to the quality of our coal operation and
assets."
"Four of our five mining complexes met or exceeded operating
expectations in the second quarter of 2008. The tonnage shortfall
at Absaloka negatively impacted its operating performance but we
are poised to make up the lost tonnage over the remainder of
2008," said D.L. Lobb, Westmoreland's president and chief executie
officer. "We are seeing positive results from our sharpened focus
on cost reduction when customers have plant outages, or when
demand is impacted by hydro power generation, such as occurred
during the second quarter of 2008. We will continue to focus on
the safety of our employees, productivity improvements at our
mining operations and wise investing of the liquidity we now have
at our subsidiaries."
Coal Operations
In the second quarter of 2008, coal sales decreased approximately
10% compared to the second quarter of 2007, to 6.3 million tons.
Second quarter 2008 coal revenues decreased to $92.5 million, a
9.1% decrease over the prior year period, attributable to an
unscheduled customer outage and the work stoppage at the company's
Absaloka Mine.
Coal operations operating income was $400,000 in 2008 compared to
$2.1 million in 2007, due to the decrease in revenue combined with
increases in fuel costs, depreciation and depletion over the prior
year period.
Power
For second quarters of 2008 and 2007, ROVA produced 375,000 and
399,000 MW hours, respectively, and achieved average capacity
factors of 83.3% and 90.7%, respectively.
Power revenues in the second quarter of 2008 decreased to
$20.8 million, or a decrease of $600,000 from the second quarter
of 2007. The decrease was driven by the decrease in MW sold which
resulted from unplanned outages during the period. Power
operations operating income was $2.8 million in 2008 compared to
$3.0 million in 2007.
Heritage Costs
The heritage segment includes costs of benefits the company
provides to former employees of its previously owned U.S. coal
mining operations, which have been disposed of. During the second
quarter of 2008, the company's heritage segment's costs increased
by $700,000 from the second quarter of 2007. 2008 black lung
heritage costs increased in the second quarter due to increases in
black lung claims and less investment income as a result of
reduced investments held by the trust.
Corporate
Corporate selling and administrative expenses increased by
$1.1 million in the second quarter 2008 compared to the second
quarter of 2007. This increase was primarily due to an increase
in professional fees driven by the company's financial statement
restatement and information technology cost increases, offset by
reduced costs resulting from the execution of the company's
restructuring plan undertaken last year.
Interest Expense and Loss on Extinguishment of Debt
Interest expense was $6.0 million for the second quarter of 2008
compared to $6.3 million in the second quarter of 2007. The
decrease resulted from the reduction in the company's ROVA debt
levels following the refinancing of that debt offset by the
interest expense recognized for the beneficial conversion feature
of the senior secured notes issued by Westmoreland Coal Company.
Interest income was $941,000 in the second quarter of 2008
compared to $2.1 million in the second quarter of 2007. Interest
income decreased because a large portion of the company's
restricted investments were used in the refinancing of its power
and mining debt. The company also recorded a $3.8 million loss on
the extinguishment of debt associated with its mining debt
refinancing during the second quarter of 2008.
Cash Flow from Operations
Liquidity
In the first six months of 2008 the company took three significant
steps to improve liquidity:
First, on March 4, 2008, the company completed the sale of
$15.0 million in senior secured convertible notes to an existing
stockholder. Secondly, on March 17, 2008, the company's
Westmoreland Partners subsidiary completed a refinancing of the
ROVA Power Project debt. The refinancing paid off all outstanding
bank borrowings, bond borrowings, and the ROVA acquisition loan,
and eliminated the need for the irrevocable letters of credit,
which supported the bond borrowings. Finally, on June 26, 2008,
the company's Westmoreland Mining subsidiary completed a
refinancing of its term and revolving debt. The refinancing
extended the repayment schedule through 2018, with principal
payments starting in 2011.
Full-text copies of the company's consolidated financial
statements for the quarter ended June 30, 2008, are available for
free at http://researcharchives.com/t/s?30d9
About Westmoreland Coal Company
Headquartered in Colorado Springs, Colorado, Westmoreland Coal
Company (AMEX: WLB) -- http://www.westmoreland.com/-- is an
independent coal company in the United States. The company mines
coal, which is used to produce electric power, and the company
owns power-generating plants.
The company's coal operations include coal mining in the Powder
River Basin in Montana and lignite mining operations in Montana,
North Dakota and Texas. Its current power operations include
ownership and operation of the two-unit ROVA coal-fired power
plant in North Carolina.
WHX CORP: June 30 Balance Sheet Upside-Down by $69.4 Million
------------------------------------------------------------
WHX Corporation's consolidated balance sheet at June 30, 2008,
showed $455.3 million in total assets and $524.7 million in total
liabilities, resulting in a $69.4 million stockholders' deficit.
The company's consolidated balance sheet at June 30, 2008, also
showed strained liquidity with $218.7 million in total current
assets available to pay $360.0 million in total current
liabilities.
WHX reported net income of $5.3 million for the three months ended
June 30, 2008, compared with net income of $4.0 million for the
same period in 2007.
The company generated Consolidated EBITDA of $20.0 million for the
three months ended June 30, 2008, up from $18.3 million for the
same period in 2007. Consolidated EBITDA includes $2.7 million
and $5.7 million of net proceeds from insurance claims in the
three months ended June 30, 2008 and 2007, respectively.
"We generated operating income and Consolidated EBITDA well ahead
of the comparable 2007 periods despite difficult economic
conditions in several markets that we serve," said Glen Kassan,
vice chairman of the Board and chief executive officer of WHX.
"Our results reflect the significant progress we have made in
developing and implementing the WHX Business System, which will
continue to improve efficiency and should drive profitable growth
during the remainder of 2008 and beyond."
Net sales for the second quarter of 2008 increased by
$25.5 million, or 14.4%, to $202.4 million, as compared to
$176.9 million in the second quarter of 2007. Bairnco, which was
acquired in April 2007, contributed $52.5 million in net sales for
the second quarter of 2008, and $43.1 million of net sales in the
second quarter of 2007. The increase in Bairnco sales of
$9.4 million is principally due to the fact that the 2007 quarter
reflects 11 weeks of sales activity (for the post-acquisition
period April 13 through June 30, 2007), and the 2008 quarter
reflects 13 weeks of activity.
The Precious Metal segment net sales increased by $6.1 million, or
15.6%, to $45.6 million. The increased sales were primarily
driven by higher precious metal prices and increased volumes in
certain markets, partially offset by declines in the domestic
automotive market.
The Tubing segment sales increased by $700,000 as strong growth in
petrochemical and shipbuilding markets serviced by the Stainless
Steel Tubing Group were partially offset by weakness in the
appliance and automotive markets serviced by the Specialty Tubing
Group.
The Engineered Materials segment sales increased by $9.3 million,
or 14.7%, driven by strong demand for commercial roofing fasteners
and new product sales in the home center market.
Liquidity
WHX is a holding company and has as its sole source of cash flow
distributions from its operating subsidiaries, H&H and Bairnco, or
other discrete transactions.
H&H's availability under its credit facilities as of Dec. 31,
2007, was $12.3 million, and as of June 30, 2008, was
$31.4 million. Bairnco's availability under its credit facilities
as of Dec. 31, 2007, was approximately $5.3 million, and as of
June 30, 2008, was $8.1 million.
The company has incurred significant losses and negative cash
flows from operations in recent years, and as of June 30, 2008,
had an accumulated deficit of $435.0 million. As of June 30,
2008, the company's current assets totaled $218.7 million and its
current liabilities totaled $360.0 million; a working capital
deficit of $141.3 million.
Included in the current liabilities as of June 30, 2008, is
$158.5 million of debt which at Dec. 31, 2007, was classified as
long term, but has currently been classified as short-term since
its maturity date is within twelve months (June 30, 2009).
$104.2 million of such debt is owed to Steel Partners, the
company's largest stockholder. An additional $32.8 million of
accrued interest and mandatorily redeemable preferred stock is
also payable to Steel Partners as of June 30, 2008.
The amounts payable to Steel Partners are expected to be either
partially or totally repaid after the completion of a rights
offering that the company is currently making to raise up to
$200 million of equity.
Full-text copies of the company's consolidated financial
statements for the quarter ended June 30, 2008, are available for
free at http://researcharchives.com/t/s?30da
About WHX Corp.
Based in White Plains, New York, WHX Corporation (Pink Sheets:
WXCP) -- http://www.whxcorp.com/-- is a holding company that
invests in and manages a group of businesses on a decentralized
basis. Apart from owning Handy & Harman, WHX acquired in
April 2007 Bairnco Corporation, which is a diversified
multinational company that operates business units in three
reportable segments: Arlon electronic materials, Arlon coated
materials and Kasco replacement products and services.
Handy & Harman is a diversified manufacturer and the "parent" of a
family of materials engineering and specialty manufacturing
companies. Its products include electronic components, specialty
fasteners, engineered materials, stainless steel tubing, specialty
tubing and fabricated precious metals, brazing soldering fluxes
and alloys of precious and non-precious metals. Handy & Harman's
strategic business units encompass three reportable segments:
precious metal, tubing and engineered materials.
WMC MORTGAGE: S&P Affirms 'B' Rating on 2 Classes of Securities
---------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on 12
classes from four transactions issued by WMC Mortgage Loan Trust
in 1997 and 1998.
The affirmations reflect sufficient credit enhancement for the
classes at their current rating levels. The remaining pool
balances, as a percentage of the original pool balance for each
deal, are as follows: 1.25% for series 1997-1, 1.40% for series
1998-1, 1.34% for series 1998-A, and 2.05% for series 1998-B.
Credit support for these transactions is provided by
overcollateralization, subordination, and excess spread.
The underlying collateral for the four transactions consists of
15- to 30-year, adjustable-rate, subprime mortgage loans that are
secured by first liens on one- to four-family residential
properties.
RATINGS AFFIRMED
WMC Mortgage Loan Trust 1997-1
Series 1997-1
Class CUSIP Rating
M-1 22540ABL1 AAA
M-2 22540ABM9 A
B 22540ABN7 B
WMC Mortgage Loan Trust 1998-1
Series 1998-1
Class CUSIP Rating
M-1 92928XAB9 AAA
M-2 92928XAC7 A
B 92928XAD5 B
WMC Mortgage Loan Trust 1998-A
Series 1998-A
Class CUSIP Rating
M-1 92928SAB0 AAA
B 92928SAD6 BBB
WMC Mortgage Loan Trust 1998-B
Series 1998-B
Class CUSIP Rating
A-2 92928SAF1 AAA
M-1 92928SAH7 AAA
M-2 92928SAJ3 A+
B 92928SAK0 BBB
XM SATELLITE: Discloses Risks in Relation to $400MM Offering
------------------------------------------------------------
On July 21, 2008, XM Satellite Radio Holdings Inc. (XMSR) issued a
press release announcing that it is launching an offering of
$400 million aggregate principal amount of new senior notes. The
offering is part of a series of transactions to refinance certain
debt of XM Satellite Radio Inc. in connection with the previously
announced merger of XMSR with a wholly-owned subsidiary of SIRIUS
Satellite Radio Inc.
As reported by the Troubled Company Reporter on Aug. 1, 2008,
SIRIUS Satellite and XM Satellite Radio Inc. completed their
merger, on July 29, 2008, resulting in the nation's premier radio
company.
In connection with presentations being made relating to the
financing of the merger, XMSR provided certain updated risk
factors to potential investors at:
http://ResearchArchives.com/t/s?30e1
Headquartered in Washington, D.C., XM Satellite Radio Holdings
Inc. (Nasdaq: XMSR) -- http://www.xmradio.com/-- is a satellite
radio company. The company broadcasts live daily from studios in
Washington, DC, New York City, Chicago, Nashville, Toronto and
Montreal.
The company also provides satellite-delivered entertainment and
data services for the automobile market through partnerships with
General Motors, Honda, Hyundai, Nissan, Porsche, Subaru, Suzuki
and Toyota.
At June 30, 2008, the company's consolidated balance sheet showed
$1.7 billion in total assets, $2.9 billion in total liabilities,
and $60.2 million in minority interest, resulting in a roughly
$1.2 billion stockholders' deficit.
* * *
As disclosed in the Troubled Company Reporter on July 30, 2008,
Standard & Poor's Ratings Services said that its ratings on
Washington, D.C.-based XM Satellite Radio Holdings Inc. and
subsidiary XM Satellite Radio Inc., including the 'CCC+' corporate
credit rating, remain on CreditWatch with developing implications,
where S&P placed them on March 4, 2008.
The proposed merger between XM and Sirius Satellite Radio Inc.
(CCC+/Watch Dev/--) was approved by the FCC on July 25, 2008.
CreditWatch Developing indicates that S&P may raise, lower, or
affirm ratings. S&P could raise the ratings if the proposed
merger is accompanied by significant refinancing and cost
rationalization. S&P could lower the ratings with or without a
merger if sizable maturities are not addressed and if the company
cannot progress rapidly toward consistent positive discretionary
cash flow. S&P initially placed the ratings on CreditWatch on
Feb. 20, 2007, then with positive implications, based on the
company's definitive agreement to an all-stock "merger of equals"
with Sirius Satellite Radio.
At the same time, Standard & Poor's also assigned its 'CCC-'
rating to XM Satellite Radio Inc.'s proposed $550 million Rule
144A exchangeable senior subordinated notes due 2014, and placed
the rating on CreditWatch with developing implications, along with
the other ratings on the company.
As reported by the TCR on Aug. 5, 2008, Moody's Investors Service
on July 23, 2008, assigned a Caa1 rating to XM Satellite Radio
Inc.'s $400 million senior notes due 2014. In addition, Moody's
has placed all ratings for XM Satellite Radio Holdings and its
subsidiary, XM Satellite Radio Inc., including the rating on the
senior notes due 2014, under review for possible downgrade.
ZVUE CORP: Restructures Agreements with Eric's Universe
-------------------------------------------------------
ZVUE Corporation announced on July 22, 2008, that it had
restructured its agreements with Eric's Universe, Inc., Eric and
Neil Bauman. The amended agreements achieved several important
goals including:
(1) Combined management responsibility for the PopSauce network
with ZVUE's, eBaumsworld team in Rochester, eliminating ZVUE's web
development and operations teams in San Francisco. The increase in
responsibility in Rochester resulted in the modification of the
employment agreements of Neil and Eric Bauman to provide for an
increase in salaries from $20,000 each, to $150,000 and $180,000,
respectively, and bonus amounts comparable to those of other
employees with similar levels of responsibilities. The increases
are effective immediately but the increased cash payouts above
their previous salaries for the remainder of 2008 are deferred to
January 1, 2009.
(2) Amended the financial earn out calculation associated with
ZVUE's 2007 purchase of eBaum's World, whereby Eric's Universe,
Inc. could have earned up to $27,500,000 in cash and stock through
2009, based on largely on traffic generation, to be a financial
earn out calculation whereby Eric's Universe, Inc. could earn up
to $32,700,000 million through 2012, based on a cash flow test
derived from a calculated EBITDA relating to ZVUE's website
businesses.
(3) Amended the payment criteria and amounts for the performance
earn out associated with ZVUE's 2007 purchase of eBaumsworld,
which called for cash payments of up to $417,000 per quarter up to
a maximum of $2,500,000 million based on successful completion of
certain development projects, by agreeing on changed criteria
based on mutually agreed business targets. In exchange for
$250,000 payable immediately and $150,000 payable over five
months, which may be accelerated under certain circumstances, the
maximum remaining performance earn out payout has been reduced
from approximately $1,250,000 million to $1,050,000 million and is
payable based on achieving such new targets on specified dates
through December 31, 2009.
(4) Modified the release of certain common stock held in escrow,
which had previously been deliverable to Eric's Universe, Inc. on
a monthly basis through October 31, 2009, to be released from
escrow only after the earlier of January 1, 2009 or the
achievement by eBaum's World, Inc. of certain revenue targets.
(5) Modified the release of certain common stock held in escrow,
which had previously been deliverable to Eric's Universe on
October 31, 2010, if Mr. Eric Bauman remained an employee at such
date, with a new arrangement whereby such escrowed shares are to
be delivered to Eric's Universe, Inc. based (for two-thirds of
such shares) upon meeting certain financial targets or (for one-
third of such shares) on October 31, 2012.
(6) In consideration for the amendments and increased
responsibility that they have assumed for the PopSauce Network, at
close ZVUE issued a total of 500,000 fully vested common shares to
Eric and Neil Bauman.
Balance Sheet
At March 31, 2008, the company's consolidated balance sheet showed
$35,708,000 in total assets, $10,734,000 in total liabilities, and
$24,974,000 in total shareholders' equity.
The company's consolidated balance sheet at March 31, 2008, also
showed strained liquidity with $7,430,000 in total current assets
available to pay $7,587,000 in total current liabilities.
Full-text copies of the company's consolidated financial
statements for the quarter ended March 31, 2008, are available for
free at http://researcharchives.com/t/s?2d04
Going Concern Doubt
Salberg & Company, P.A., in Boca Raton, Florida, expressed
substantial doubt about ZVUE Corp.'s ability to continue as a
going concern after auditing the company's consolidated financial
statements for the year ended Dec. 31, 2007. The auditing firm
pointed to the company's net loss of $18,188,833 and net cash used
in operations of $12,156,127 for the year ended Dec. 31, 2007, and
accumulated deficit of $41,218,007 at Dec. 31, 2007.
The company has incurred losses and negative cash flows from
operations and has an accumulated deficit at March 31, 2008, of
$48,777,000.
With the company's available cash of $4,614,000 at March 31, 2008,
and $3,673,000 available from a financing agreement with a related
party and the expected growth in its business, the company
believes that it will have sufficient funds and anticipated future
cash flows to continue in operation at least through the end of
2008.
About ZVUE Corp.
Based in San Francisco, ZVUE Corporation (Nasdaq: ZVUE)
-- http://www.zvue.com/-- is a global digital entertainment
company. ZVUE(TM) personal media players are mass-market priced
and currently available for purchase online and in Wal-Mart stores
throughout the U.S.
* S&P Cuts 97 Ratings on US Synthetic CDOs at July Month-End Run
----------------------------------------------------------------
Standard & Poor's Ratings Services took rating actions on various
U.S. synthetic collateralized debt obligation (CDO) transactions
following the July month-end batch run:
-- S&P placed 17 ratings on CreditWatch with negative
implications;
-- S&P lowered 97 ratings and removed 12 from CreditWatch
negative and left one on CreditWatch negative; and
-- S&P affirmed 40 ratings and removed them from CreditWatch
negative.
The CreditWatch negative placements reflect negative rating
migration in the portfolios and the fact that the synthetic rated
overcollateralization (SROC) ratios for the affected transactions
had fallen below 100% as of the July month-end run; the downgrades
affected classes that had SROC ratios below 100% as of the July
month-end run and at a 90-day forward run; and the affirmations
and CreditWatch negative removals affected classes that had SROC
ratios at or over 100% at their current rating levels.
RATINGS LIST
ABACUS 2004-1 Ltd.
Rating
Class To From
A AA AAA
B A+ AA
C BBB A-
ABACUS 2004-2 Ltd.
Rating
Class To From
A BBB+ AA
B BB+ BBB+
C B+ BB+
D B- BB+
ABACUS 2005-1 CB1 Ltd.
Rating
Class To From
B BBB+ A-
C BB+ BBB
D BB+ BBB-
E-1 B+ BB+
E-2 B+ BB+
F CCC+ BB-
G CCC- CCC+
ABACUS 2005-3 Ltd.
Rating
Class To From
B AA- AA+/Watch Neg
B Series 2 AA- AA+/Watch Neg
C A+ AA-/Watch Neg
C Series2 A+ AA-/Watch Neg
D BBB- BBB+/Watch Neg
D Series 2 BBB- BBB+/Watch Neg
D Series 3 BBB- BBB+/Watch Neg
E BB BBB-/Watch Neg
ABACUS 2005-5 Ltd.
Rating
Class To From
A-1 A+ AA+
ABACUS 2006-12 Ltd.
Rating
Class To From
A-1 CCC+ BB-
A-2 CCC B-
B CCC- CCC+
ABACUS 2006-8 Ltd.
Rating
Class To From
A-1 BB+ AA
A-2 B+ A
D CCC- B+
ABACUS 2006-NS1 Ltd.
Rating
Class To From
D A+ AA-/Watch Neg
F A- A/Watch Neg
G BBB+ A-/Watch Neg
H BBB BBB+/Watch Neg
J BBB- BBB
ABSpoke 2005-X Ltd.
2005-X
Rating
Class To From
VFRN B+ BB-
ABSpoke 2005-XA Ltd.
2005-XA
Rating
Class To From
VFRN BBB BBB+
ABSpoke 2005-XII B Segregated Portfolio of SPGS SPC
2005-XII B
Rating
Class To From
VFRN B+ BBB-
AMP ABX 2006-1 Ltd.
Rating
Class To From
Var Notes A- A-/Watch Neg
ARLO VI Ltd.
SABS 2006-5
Rating
Class To From
Notes CCC- CCC
ARLO VI Ltd.
SABS 2006-4
Rating
Class To From
Notes CCC- CCC+
ARLO VI Ltd.
2006 (Howell Park)
Rating
Class To From
Notes CCC- CCC
ARLO VI Ltd.
2006 (Hominy Hill)
Rating
Class To From
Notes CCC- CCC
ARLO VII Ltd.
SABS 2007-1
Rating
Class To From
Notes CCC- CCC
Buchanan SPC
2006-II
Rating
Class To From
A2 CCC CCC+
Buchanan SPC
2006-III
Rating
Class To From
A4 CCC- CCC+
Buchanan SPC
2006-I
Rating
Class To From
A1J CCC+ B
Calculus MABS Resecuritization Trust Series 2007-1
Rating
Class To From
Units CCC CCC+
Calculus MABS Resecuritization Trust Series 2007-2
Rating
Class To From
Units CCC CCC+
Calculus SCRE Trust Series 2006-11
Rating
Class To From
Trust Unit A- A
Credit and Repackaged Securities Ltd.
2006-1
Rating
Class To From
Notes BB+/Watch Neg BB+
Credit Default Swap
Swap Risk Rating - Protection Buyer, CDS Reference # Torino II
Rating
Class To From
Tranche BBB+srb/Watch Neg BBB+srb
Dallaglio CDO 2005-4 Ltd.
Rating
Class To From
B CCC+ B+
Dunloe 2005-I Ltd
Rating
Class To From
B B B+
C CCC CCC+
Eirles Two Ltd.
212
Rating
Class To From
212 BBB- BBB
Eirles Two Ltd.
208
Rating
Class To From
Series 208 A+ AA
Eirles Two Ltd.
242-245 & 247
Rating
Class To From
Series 242 BB+ A
Series 243 B- BB+
Series 244 CCC+ B+
Series 245 B+ BBB
Series 247 B- BB+
ELM B.V.
98
Rating
Class To From
SecdCrLkd BBB/Watch Neg BBB
Herald Ltd.
24
Rating
Class To From
24 A- A-/Watch Neg
Ixion PLC
4,5,6, & 7
Rating
Class To From
4 CCC- CCC+
5 CCC- B
6 CCC B+
7 CCC- CCC+
Ixion PLC
9 & 11
Rating
Class To From
9 CCC- CCC
Ixion PLC
SYRAH 2006-11 SERIES 16
Rating
Class To From
16 CCC- CCC+
Ixion PLC
SYRAH 2006-11 SERIES 17
Rating
Class To From
17 CCC- CCC
Ixion PLC
SYRAH 2006-11 SERIES 18
Rating
Class To From
18 CCC- CCC
Ixion PLC
Matrix 2007-1 Series 20
Rating
Class To From
A CCC- CCC
H CCC- CCC
Ixion PLC
33
Rating
Class To From
Notes BBB+ A
Lakeview CDO SPC
2007-1
Rating
Class To From
A AAA AAA/Watch Neg
B AA AA/Watch Neg
C A A/Watch Neg
Lakeview CDO SPC
2007-2
Rating
Class To From
Notes AA AA/Watch Neg
Lakeview CDO SPC
2007-3
Rating
Class To From
Notes AA AA/Watch Neg
Lakeview CDO SPC
2007-4
Rating
Class To From
Notes AA AA/Watch Neg
Lehman Brothers Treasury Co. B.V.
US$4,000,000 inflation-linked and credit-linked variable
interest notes
Rating
Class To From
Notes A/Watch Neg A+
Lunar Funding I Ltd.
12
Rating
Class To From
12 A A/Watch Neg
Magnolia Finance II PLC
2006-5A
Rating
Class To From
A BB AA-
Magnolia Finance II PLC
2006-5CG
Rating
Class To From
CG CCC+ BBB-
Magnolia Finance II PLC
2006-5CE
Rating
Class To From
CE CCC+ BBB-
Magnolia Finance II PLC
2006-5B
Rating
Class To From
B CCC+ BBB+
Magnolia Finance II PLC
2006-5CU
Rating
Class To From
CU CCC+ BBB-
Magnolia Finance II PLC
2006-6B
Rating
Class To From
Series B AA+/Watch Neg AA+
Magnolia Finance II PLC
2006-6C
Rating
Class To From
Series C A+/Watch Neg A+
Magnolia Finance II PLC
2006-6D
Rating
Class To From
Series D A/Watch Neg A
Magnolia Finance II PLC
2006-5D2
Rating
Class To From
D2 CCC- CCC+
Magnolia Finance II PLC
2006-8C
Rating
Class To From
Series C CCC- CCC
Magnolia Finance II PLC
2006-8B
Rating
Class To From
Series B CCC CCC+
Magnolia Finance II PLC
2006-9A
Rating
Class To From
Notes CCC- CCC+
Magnolia Finance II PLC
2006-9B
Rating
Class To From
Notes CCC- CCC
Mill Reef SCDO 2005-1 Ltd.
Rating
Class To From
A-2L CCC CCC+
Mistletoe ORSO Trust 3
Rating
Class To From
5 Cr Link BBB+ BBB+/Watch Neg
Morgan Stanley ACES SPC
2006-3
Rating
Class To From
IIA BBB+ BBB+/Watch Neg
IIB BBB+ BBB+/Watch Neg
IIC BBB+ BBB+/Watch Neg
IID BBB+ BBB+/Watch Neg
IIE BBB+ BBB+/Watch Neg
IIF BBB+ BBB+/Watch Neg
III B B/Watch Neg
Morgan Stanley ACES SPC
2006-9
Rating
Class To From
IA A-/Watch Neg A-
Morgan Stanley ACES SPC
2007-13
Rating
Class To From
IA AA- AA-/Watch Neg
IIA AA- AA-/Watch Neg
IIB AA- AA-/Watch Neg
Morgan Stanley ACES SPC
2007-25
Rating
Class To From
IA AA AA/Watch Neg
Morgan Stanley Managed ACES SPC
2005-1
Rating
Class To From
V B BB BB/Watch Neg
Morgan Stanley Managed ACES SPC
2005-2
Rating
Class To From
V BB BB/Watch Neg
Morgan Stanley Managed ACES SPC
2006-4
Rating
Class To From
II AA AA/Watch Neg
Morgan Stanley Managed ACES SPC
2006-9
Rating
Class To From
SbJrSuprSr AAA AAA/Watch Neg
North Street Referenced Linked Notes, 2005-7, Ltd.
Rating
Class To From
A B+ BB
B-1 B B+
C CCC- CCC
PARCS Master Trust
2006-10 CARIBOU
Rating
Class To From
TrustUnits AAA/Watch Neg AAA
PARCS Master Trust
2007-3 CALVADOS
Rating
Class To From
Trust Unit A/Watch Neg A
PARCS Master Trust
2007-8 CALVADOS
Rating
Class To From
Trust Unit AA-/Watch Neg AA-
PARCS Master Trust
2007-10 CDX7 10Y 10-15
Rating
Class To From
Trust Unit AAA AAA/Watch Neg
PARCS Master Trust
2007-18 Piedmont
Rating
Class To From
Trust Unit AA-/Watch Neg AA-
Primoris SPC Ltd
F1-10
Rating
Class To From
Notes CCC/Watch Neg CCC
Pyxis Master Trust
2007-28 POINT GREEN II
Rating
Class To From
Units AA+/Watch Neg AA+
REVE SPC
45
Rating
Class To From
Notes A- A-/Watch Neg
REVE SPC
2007-47
Rating
Class To From
Series 47 BBB BBB/Watch Neg
Rutland Rated Investments
LYNDEN 2006-1 (21)
Rating
Class To From
A1-L A+ A+/Watch Neg
Rutland Rated Investments
BEDFORD 2006-1 (30)
Rating
Class To From
A2-F A- A-/Watch Neg
A3-F BBB+ BBB+/Watch Neg
A3-L BBB+ BBB+/Watch Neg
Rutland Rated Investments
Millbrook 2006-4 (31)
Rating
Class To From
A CCC- B-
Rutland Rated Investments
Millbrook 2006-4 (33)
Rating
Class To From
C CCC- CCC
Rutland Rated Investments
Millbrook 2006-4 (32)
Rating
Class To From
B CCC- CCC+
Seawall 2007-1 Ltd
Rating
Class To From
E-2 BB-/Watch Neg BB-
Series 2006-1 Segregated Portfolio of Stowe CDO SPC
2006-1
Rating
Class To From
A A- A-/Watch Neg
SPGS SPC
2006-IA
Rating
Class To From
Notes B BBB
SPGS SPC
2006-IIC
Rating
Class To From
Var Notes CCC- CCC+
SPGS SPC
BALDWIN 2006-I
Rating
Class To From
Notes B+ BBB
SPGS SPC
BALDWIN 2006-II
Rating
Class To From
Notes B- BB
SPGS SPC
BALDWIN 2006-III
Rating
Class To From
Notes CCC+ BB
SPGS SPC
BALDWIN 2006-IV
Rating
Class To From
Notes CCC+ B+
SPGS SPC
BALDWIN 2006-V
Rating
Class To From
Notes CCC- B-
SPGS SPC
BALDWIN 2006-VI
Rating
Class To From
A CCC- B-
SPGS SPC
BALDWIN 2006-VII
Rating
Class To From
A-1 CCC+ BB
A-2 CCC+ B+
STEERS Thayer Gate CDO Trust, Series 2006-6
Rating
Class To From
Trust Unit BB+ BB+/Watch Neg
STRATA 2006-34 Ltd
Rating
Class To From
Notes A-/Watch Neg A-
Strata 2007-1 Ltd.
Rating
Class To From
Notes AA-/Watch Neg AA-
Strata Trust Series 2007-6
Rating
Class To From
Notes A- A-/Watch Neg
TIERS Derby Synthetic CDO Floating Rate Credit Linked Trust
2007-13
Rating
Class To From
Certs AA- AA-/Watch Neg
TIERS Derby Synthetic CDO Floating Rate Credit Linked Trust
2007-16
Rating
Class To From
2007-16 AA- AA-/Watch Neg
Toronto-Dominion Bank (The)
Toronto-Dominion Bank CAD 263,860,000 Portfolio Credit Linked
Notes due March
22, 2012
Rating
Class To From
PtflCdtLkd BBB- BBB-/Watch Neg
Tribune Ltd.
Series 46
Rating
Class To From
Series 46 AAA/Watch Neg AAA
True North No. 2 (CDO) Ltd
Rating
Class To From
A AA AA/Watch Neg
True North No. 3 (CDO) Ltd
Rating
Class To From
A AAA AAA/Watch Neg
* S&P Takes Rating Actions on Firms in Oil, Gas Service Sectors
---------------------------------------------------------------
Standard & Poor's Ratings Services, following an industry review,
took several rating actions on companies in the oil & gas service
sector.
"The review was prompted by our view that healthy industry
conditions will likely remain for the near to medium term and
follows Standard & Poor's recent announcement that it will
introduce several enhancements to its analytical approach to
rating speculative-grade debt. The rating actions listed below
were on speculative-grade companies. A consistent theme for these
companies was the strength of their financial performance and our
belief that similar performance would most likely continue for the
near to medium term," S&P relates.
Standard & Poor's raised the corporate credit rating on Chart
Industries Inc. to 'BB-' from 'B+', its senior secured rating to
'BB+' from 'BB', and its subordinated debt rating to 'B+' from
'B'. The outlook is stable.
"The upgrade reflects continued strong operating performance, a
significant reduction in leverage, and expectations for solid
results to persist over the near term given the company's backlog.
Chart has more than doubled its EBITDA to well over $100 million
for the trailing 12 months ended June 30, 2008, from less than $50
million in 2005, when we initially rated the company. Furthermore,
its already healthy gross profit margins have improved from the
high 20% area to more than 30% for the first half of 2008. Strong
operating performance and $100 million of debt repayment under its
term loan have resulted in leverage decreasing from more than 6x
to approximately 2x as of June 30, 2008. Still, the speculative-
grade rating on Chart reflects the cyclicality inherent in the
industrial gas and natural gas processing markets and the
company's limited scale," S&P says.
Standard & Poor's raised Superior Energy Services Inc. corporate
credit and senior unsecured ratings to 'BB+' from 'BB'. The
outlook is stable. "The upgrade was based on Superior's strong
operating performance, geographic diversity, decreased commodity
exposure following the divestiture of the company's 75% interest
in SPN Resources and strong financial metrics. Debt to EBITDA for
last 12 months ended June 30, 2008 was a healthy 1.1x and EBITDA
interest coverage was in excess of 20x. At this juncture, an
upgrade is limited for the company based on our view of industry
conditions and company's business scope," S&P explains.
Standard & Poor's revised its outlook on Global Geophysical
Services Inc. to positive from stable. "At the same time, we
affirmed its 'B-' corporate credit rating. The outlook revision
reflects the company's improved operating performance and
financial metrics and our expectations that the industry
fundamentals will continue to be strong in the near term. The
likely continued growth in its seismic operations will support
underlying improvement in profitability. We are likely to raise
the ratings on Global in the first half of 2009, contingent on
robust EBITDA growth, improving margins and strong financial
metrics," S&P says.
Standard & Poor's also revised its outlook on Stewart & Stevenson
LLC to positive from stable. "In addition, we affirmed its 'B'
corporate credit rating. The outlook revision reflects increased
scale and scope and improved financial metrics. Since the rating
was assigned in 2006, Stewart & Stevenson has considerably
increased its EBITDA, resulting in interest coverage of 5.1x for
the 12-month period ended April 30, 2008 and adjusted debt to
EBITDA of 2.1x. Despite recent softness in its business due to
overcapacity and pricing pressures in the well stimulation market,
we expect North American exploration and production companies'
increasing focus on unconventional "resource" plays to be a
favorable long-term driver for pressure pumping demand which
should help Stewart & Stevenson maintain its financial profile.
Still, the speculative-grade rating on Stewart & Stevenson
reflects the company's dependence on cyclical end markets for its
core products and services and its limited track record in its
current configuration," S&P says.
* Jones Walker Plans to Combine with Miller Hamilton
-----------------------------------------------------
William H. Hines, Esq., Managing Partner of the law firm of Jones,
Walker, Waechter, Poitevent, Carrere & Denegre L.L.P, and Ronald
A. Snider, Esq., Managing Partner of the law firm of Miller,
Hamilton, Snider & Odom LLC, today announced plans to combine
firms.
The combination, approved by the members of Miller Hamilton and
the Jones Walker partnership this month, is effective Sept. 1,
2008. The combined firm will have more than 270 attorneys. The
transaction adds new Jones Walker offices in Birmingham, Mobile,
and Montgomery in Alabama, and in Atlanta, Georgia, as well as
additional Miller Hamilton lawyers in Jones Walker’s Miami and
Washington, D.C. offices.
Mr. Hines commented, "Miller Hamilton has a strong and long
history in the financial services sector, representing financial
institutions across the South. This expansion for Jones Walker
into additional states and the addition of capabilities to our
banking practice offers a wider range of services and locations to
our corporate and financial services client base. One of Jones
Walker's larger clients, International Shipholding Corporation,
recently relocated to Mobile, and we can service them more
efficiently with a local office."
Mr. Snider stated, "This combination made sense on many levels. We
expand the practices that we are able to offer to our clients, and
the culture between the two firms is a great fit. Together, our
firm will become one of the largest regional firms in the southern
U.S., offering a full range of legal services. The combination of
the two firms fits well with both firms' strategic business
objectives and allows us to take advantage of a number of
opportunities throughout the South."
John C. H. Miller, Jr., founding partner of Miller Hamilton, said
the combination will bring together two organizations that have a
long history of working together. "Since we first opened our
offices in Mobile, our lawyers have had the privilege and
pleasure, on many occasions, of working with and alongside lawyers
from the Jones Walker firm. These experiences over the years, I
believe, have bred in both firms a great deal of mutual respect,
and that, among other things, makes the prospect of this
combination something that we look forward to with great
excitement."
The law firm will continue under the name of Jones Walker, led by
William H. Hines as Managing Partner. Jones Walker previously had
240 attorneys practicing in 3 states and the District of Columbia.
Miller Hamilton added 32 attorneys to Jones Walker in 3 states and
the District of Columbia.
About Jones, Walker
Jones, Walker, Waechter, Poitevent, Carrere & Denegre L.L.P. --
http://www.joneswalker.com/-- provides an extensive range of
legal services to a national and international corporate client
base through offices in Alabama, Georgia, Florida, Louisiana,
Texas, and Washington, D.C.
About Miller Hamilton
The firm of Miller, Hamilton, Snider & Odom LLC --
http://www.mhsolaw.com/-- was founded in Mobile in 1977 primarily
as a banking regulatory firm. Employing forty lawyers in three
states and the District of Columbia., Miller Hamilton has the
strength of a large firm while retaining the agility and economics
of a smaller group.
* AVIATION WEEK's Study Measures Airlines' Survivability
--------------------------------------------------------
AVIATION WEEK's latest Top-Performing Companies (TPC) report
focuses on the global airline industry, revealing which carriers
are in the best shape to prevail against the daunting economic
challenges they face.
TPC project manager Michael Lowry used proprietary formulas to
rank airlines in three categories. The metrics have been
significantly revised this year to place more emphasis on
survivability, reflecting the headaches airlines face through
soaring fuel costs and faltering demand. The TPC feature is
highlighted in this week's issue of Aviation Week & Space
Technology. Articles written by Adrian Schofield and James Ott
explain the rankings and identify underlying industry trends.
The TPC study shows that the best of the Asia-Pacific and European
airlines are head and shoulders above their peers among the major
legacy carriers, with Singapore Airlines again at the top of the
list and Malaysia Airlines improving the most. The U.S. majors,
meanwhile, are entrenched in the bottom half of the table. "The
gap between the Asian and European top performers and the U.S.
airlines has only grown larger over the past year," the article
says. Other ranking categories cover low-cost and regional
airlines, and the major cargo carriers.
In addition, Lowry has put together a list of five U.S. airlines
that are at the greatest risk of filing for Chapter 11 bankruptcy
protection over the next two years. The article also explains what
airline actions can reduce bankruptcy risk.
The best-performing airlines in each category feature strong
liquidity, good financial health, cost discipline and a focus on
efficiency.
Top Ten Major Legacy Airlines:
1. Singapore Airlines
2. Malaysian Airline System Berhad
3. Iberia Lineas Aereas de Espana S.A.
4. Aer Lingus Group PLC
5. Deutsche Lufthansa AG
6. Qantas Airways Ltd.
7. Finnair Oyj
8. Cathay Pacific Airways Ltd.
9. British Airways PLC
10. AIR FRANCE KLM Group
Top Ten Low-Cost/Regional Airlines:
1. Ryanair Holdings plc
2. easyJet plc
3. Allegiant Travel Company
4. Hainan Airlines Co. Ltd.
5. Southwest Airlines Co.
6. Transat A.T. Inc.
7. AirAsia Berhad
8. Copa Holdings, S.A.
9. WestJet Airlines Ltd.
10. Norwegian Air Shuttle ASA
The United Parcel Service, Inc. was the highest ranked freight
carrier.
AVIATION WEEK's TPC study was launched in 1996, aimed at
identifying strong and weak performers in the aerospace & defense
(A&D) and airline industries. This year, for the first time,
separate studies were conducted on the A&D and airline sectors.
Proprietary metrics have been refined over the past 12 years, with
input from industry leaders, to include scores in five categories:
liquidity, fuel cost management, financial health, earnings
performance, and asset utilization.
For the ranking tables, explanation of metrics, and full article,
visit http://aviationweek.com/tpc.To learn more about AVIATION
WEEK's new Top-Performing Companies Benchmarking Tool, visit
https://a1.ecom01.com/aweek/665f69643d3930/FM.cgi or sign up for
the Performance Metrics of Top-Performing Companies Management
Forum in Fort Worth, Texas in September at
http://aviationweek.com/forums/tpcmain.htm.
AVIATION WEEK, a division of The McGraw-Hill Companies, is the
largest multimedia information and services provider to the global
aviation, aerospace and defense industries, and includes the
publications Aviation Week & Space Technology, Defense Technology
International, Business & Commercial Aviation, Overhaul &
Maintenance, ShowNews, Aviation Daily, The Weekly of Business
Aviation, Aerospace Daily & Defense Report and the World Aerospace
Database. The group's website, http://www.aviationweek.com,offers
the industry's most reliable news, information, search and online
community tools. Premium content services include the Aviation
Week Intelligence Network, MRO Prospector, and the new Top-
Performing Companies Benchmarking Tool. The group also produces
prominent conferences, exhibitions and management forums around
the world.
* Large Companies with Insolvent Balance Sheets
-----------------------------------------------
Total
Total Shareholders
Working
Assets Equity Capital
Company Ticker ($MM) ($MM) ($MM)
------- ------ ------ ------------ -------
ABSOLUTE SOFTWRE ABT CN 87 (2) 29
AFC ENTERPRISES AFCE US 146 (51) (28)
AINSWORTH LUMBER ANS CN 1,022 (108) 45
APP PHARMACEUTIC APPX US 1,105 (42) 260
ARIAD PHARM ARIA US 82 (39) 59
BARE ESCENTUALS BARE US 263 (49) 113
BLOUNT INTL BLT US 482 (33) 148
CABLEVISION SYS CVC US 9,483 (5,001) (633)
CENTENNIAL COMM CYCL US 1,375 (1,040) 57
CHENIERE ENERGY CQP US 1,855 (289) 185
CHENIERE ENERGY LNG US 2,832 (202) 293
CHOICE HOTELS CHH US 349 (115) (16)
CLOROX CO CLX US 4,730 (350) (412)
COLUMBIA LABORAT CBRX US 48 (6) 11
CONEXANT SYS CNXT US 625 (133) 206
COREL CORP CRE CN 255 (12) (20)
COREL CORP CREL US 255 (12) (20)
CROWN MEDIA HL-A CRWN US 682 (661) (35)
CV THERAPEUTICS CVTX US 351 (207) 267
CYBERONICS CYBX US 136 (15) 110
CYTORI THERAPEUT CYTX US 17 (12) 1
DELTEK INC PROJ US 181 (72) 39
DEXCOM DXCM US 57 (15) 34
DISH NETWORK-A DISH US 7,681 (2,092) (466)
DUN & BRADSTREET DNB US 1,658 (512) (192)
DYAX CORP DYAX US 85 (14) 21
EINSTEIN NOAH RE BAGL US 160 (22) (48)
ENDEVCO INC EDVC US 19 (5) (8)
EXTENDICARE REAL EXE-U CN 1,541 (19) 125
FORD MOTOR CO F BB 270,450 (3,229) 19,646
FORD MOTOR CO F US 270,450 (3,229) 19,646
GARTNER INC IT US 1,121 (42) (266)
GENCORP INC GY US 994 (24) 67
GENERAL MOTORS GM US 136,046 (55,594) (18,825)
GENERAL MOTORS C GMB BB 136,046 (55,594) (18,825)
GLG PARTNERS INC GLG US 581 (350) 80
GLG PARTNERS-UTS GLG/U US 581 (350) 80
HEALTHSOUTH CORP HLS US 1,965 (872) (161)
HUMAN GENOME SCI HGSI US 847 (120) (36)
IMAX CORP IMX CN 216 (89) (4)
IMAX CORP IMAX US 216 (89) (4)
IMS HEALTH INC RX US 2,360 (10) 324
INCYTE CORP INCY US 205 (237) 152
INTERMUNE INC ITMN US 210 (81) 143
IPCS INC IPCS US 553 (38) 60
JAZZ PHARMACEUTI JAZZ US 187 (36) (0)
KNOLOGY INC KNOL US 650 (43) 2
LIFE SCIENCES RE LSR US 202 (14) 10
LINEAR TECH CORP LLTC US 1,584 (434) 1070
MEDIACOM COMM-A MCCC US 3,659 (283) (295)
MOLECULAR INSIGH MIPI US 146 (10) 114
MOODY'S CORP MCO US 1,664 (822) (248)
NATIONAL CINEMED NCMI US 540 (475) 58
NPS PHARM INC NPSP US 188 (197) 95
OCH-ZIFF CAPIT-A OZM US 2,129 (208) N.A.
OSIRIS THERAPEUT OSIR US 32 (15) (23)
PRIMEDIA INC PRM US 251 (137) (6)
PROTECTION ONE PONE US 655 (45) 0
RADNET INC RDNT US 510 (77) 10
RASER TECHNOLOGI RZ US 73 (11) (12)
REGAL ENTERTAI-A RGC US 2,688 (214) (124)
RESVERLOGIX CORP RVX CN 21 (6) 16
ROK ENTERTAINMEN ROKE US 21 (26) (15)
ROTHMANS INC ROC CN 536 (209) 100
RURAL CELLULAR-A RCCC US 1,405 (558) 169
SALLY BEAUTY HOL SBH US 1,496 (695) 413
SEALY CORP ZZ US 1,044 (105) 41
SEMGROUP ENERGY SGLP US 262 (55) (10)
SHERWOOD COOPER SWC CN 283 (21) (54)
SONIC CORP SONC US 798 (87) (41)
ST JOHN KNITS IN SJKI US 213 (52) 80
SUN COMMUNITIES SUI US 1,221 (11) N.A.
SYNTA PHARMACEUT SNTA US 87 (10) 60
TAUBMAN CENTERS TCO US 3,198 (1) N.A.
TEAL EXPLORATION TEL SJ 47 (19) (42)
TEAL EXPLORATION TL CN 47 (19) (42)
THERAVANCE THRX US 281 (112) 202
UAL CORP UAUA US 21,336 (570) (2,522)
UST INC UST US 1,417 (394) 165
VALENCE TECH VLNC US 37 (60) 11
WARNER MUSIC GRO WMG US 4,519 (99) (750)
WEIGHT WATCHERS WTW US 1,107 (893) (210)
WESTMORELAND COA WLB US 783 (178) (85)
WR GRACE & CO GRA US 3,859 (273) 934
XM SATELLITE -A XMSR US 1,724 (1,144) (683)
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com/
On Thursdays, the TCR delivers a list of recently filed chapter 11
cases involving less than $1,000,000 in assets and liabilities
delivered to nation's bankruptcy courts. The list includes links
to freely downloadable images of these small-dollar petitions in
Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland,
USA. Sheryl Joy P. Olano, Shimero R. Jainga, Ronald C. Sy, Joel
Anthony G. Lopez, Cecil R. Villacampa, Melanie C. Pador, Ludivino
Q. Climaco, Jr., Loyda I. Nartatez, Tara Marie A. Martin, Joseph
Medel C. Martirez, Ma. Cristina I. Canson, Christopher G.
Patalinghug, and Peter A. Chapman, Editors.
Copyright 2008. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $775 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same firm
for the term of the initial subscription or balance thereof are
$25 each. For subscription information, contact Christopher Beard
at 240/629-3300.
*** End of Transmission ***