/raid1/www/Hosts/bankrupt/TCR_Public/081103.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, November 3, 2008, Vol. 12, No. 262
Headlines
3 DAY: Section 341(a) Meeting Scheduled for November 24
ACM-TEXAS: Section 341(a) Meeting Scheduled for November 4
ADVANCED MICRO: Cash Payment for DTV Deal Cut to $141.5 Million
ALLIED WASTE: Earns $112.5 Million in Quarter Ended September 30
AMERICAN MEDIA: Extends Tender Offers to November 21
AMERICHIP INTERNATIONAL: Retains Crusader Securities as Adviser
AMERICHIP INTERNATIONAL: Will Acquire OrbitForm Group
AMERICHIP INT'L: Will Sell 50% of KSI Machine to James Kotsonis
ARBY'S RESTAURANT: Moody's Cuts CFR to B2; Outlook Negative
ARLINGTON RIDGE: Taps Algon Capital as Financial Advisers
ARLINGTON RIDGE: Asks Emergency Authority to Borrow up to $1.1MM
ARLINGTON RIDGE: Section 341(a) Meeting Scheduled for Nov. 5
ATA AIRLINES: Court OKs BMC's Review of Avoidance Claims
ATA AIRLINES: Deadline for Bids Set as AAI Dropped as Lead Bidder
ATA AIRLINES: Obtains Court OK to Sell Aircraft to Flight Support
ATA AIRLINES: Starman Auction for Properties Net $16MM
ATA AIRLINES: Wins OK for Mesirow As Advisor for FedEx Suit
BEARINGPOINT INC: Misses NYSE's $100 Mln. Market Value Threshold
BIOPURE CORP: Nasdaq Extends Compliance Period Until March 16
CANWEST MEDIA: Moody's Puts B1 Ratings on Review for Likely Cut
CASTRO PROPERTY: Foreclosure Auction on Six Units Suspended
CHRYSLER LLC: Cerberus Capital Ends Talks With Nissan
CLARIENT INC: September 30 Balance Sheet Upside-Down by $2.7MM
COLOWYO COAL: Moody's Cuts Rating to Ba3; Outlook Negative
COMMERCIAL VEHICLE: Dismal 3Q Cues Moody's to Consider Rtngs Cut
CONCORD CAMERA: Board OKs Plan of Liquidation, Terminates Workers
DELTA AIR: Amends Compensation Plan as Northwest Merger Completes
ELECTRICAL COMPONENTS: Moody's Affirms Caa2 Ratings; Stable
FITNESS HOLDINGS: Court Extends Schedules Deadline to December 4
FITNESS HOLDINGS: Section 341(a) Meeting Scheduled for Nov. 26
FRANKLIN CREDIT: NASDAQ to Delist Securities on November 3
FREEDOM BANK: Gives Up to FDIC; Fifth Third Buys All Deposits
GAINEY CORP: May Employ Dickinson Wright as Bankruptcy Counsel
GAINEY CORP: Seeks to Extend Filing of Schedules to November 13
GENERAL GROWTH: Moody's Cuts Ratings B3; Remain Under Review
GENERAL MOTORS: Merger Talks Proceed; Cerberus Halts Nissan Talks
GMAC LLC: Moody's Cuts Ratings to Caa1, Continues Rating Review
GOE LIMA: Taps Taft Stettinius as Bankruptcy Counsel
GRANITE XPERTS: Schedules Filing Deadline Extended to Nov. 10
GRANITE XPERTS: Wants Rally Capital as Financial Advisor
GWLS HOLDINGS: Wants to Files Schedules & Statements Until Dec. 19
HEXION SPECIALTY: Court Denies Lending Commitment Extension Plea
HUNTSMAN CORP: Court Denies Lending Commitment Extension Plea
INFINITY ENERGY: Inks Forbearance Deal; Loan Moved to May 31
INVISTA BV: Moody's Affirms Ba2 CFR; Lowers SGL to SGL-3
ISTAR INC: Moody's Downgrades Ratings to Ba3; Under Review
JBS USA: Moody's Withdraws Ba3 Term Loan Rating
JOHN MANEELY: Moody's Keeps CFR at B1; Outlook Stable
LEVEL 3 COMMS: Prem Watsa et al. Discloses 9.7% Equity Stake
LOCAL TV: Moody's Downgrades CFR to Caa1; Outlook Negative
LODGENET INTERACTIVE: Sept. 30 Balance Sheet Upside-Down by $80MM
MAXJET AIRWAYS: Judge Walsh Approves Plan Disclosure Statement
MCDONALD TECHNOLOGIES: Moody's Withdraws Junk Ratings
MEDICOR LTD: Plan Filing Period Extended to December 5
MERVYN'S LLC: CREDITORS WANT ESTATE LIQUIDATED UNDER CH. 7
MERVYN'S LLC: Seeks to Pay Employee Incentives at Closing Sales
MERVYN'S LLC: Claims Bar Date Fixed to Jan. 9, 2009
MERVYN'S LLC: Removal Period for Civil Actions Extended to Jan. 9
MGM MIRAGE: Moody's Assigns (P)Ba1 to Proposed Benchmark Notes
MODTECH HOLDINGS: Section 341(a) Meeting Set for December 2
MOVIDA COMMS: Wants Plan Filing Period Extended to November 26
NATIONAL LAMPOON: Inks Employment Deal with CFO Lorraine Evanoff
NELNET INC: Moody's Cuts Rating to Ba1; On Review
NORTH OAKLAND MEDICAL: Sale to Physicians Medical Fails; Closes
NORTHWEST AIRLINES: Delta Files Amendment to Compensation Plan
OFFICE DEPOT: Moody's Reviews Low-B Rating for Possible Downgrade
OPPENHEIMER HOLDINGS: Moody's Reviews CFR at B1 for Downgrade
PAPER INT'L: Seeks to Employ Kurtzman Carson as Claims Agent
PEOPLE AGAINST DRUGS: Seeks to Employ Pronske as Bankr. Counsel
PEOPLE AGAINST DRUGS: Wants Pace Realty as Property Manager
PHARMANET DEVELOPMENT: Moody's Reviews Ratings for Downgrade
PHYSICIANS MEDICAL: Taps Bradley Arant as Attorneys
PHYSICIANS MEDICAL: Section 341(a) Meeting Set for November 18
POMARE LTD: Section 341(a) Meeting Scheduled for November 7
PRESCIENT APPLIED: Posts $2.14MM Net Losses for Qtr Ended Sept. 30
QUEST RESOURCE: Lender Waives Potential Covenant Non-Compliance
RED SHIELD: Sells All Assets to Red Shield Acquisition for $18.8MM
RELIANT ENERGY: Merrill Lynch Extends Waiver until November 6
SIRIUS XM: To Exchange 65MM Shares for $19.5MM Convertible Notes
SIRVA INC: Transfers Operations to Indiana, Creates 240 New Jobs
SJ LAND LLC: Section 341(a) Meeting Scheduled for December 4
STEVE AND BARRY'S: Picks Clear Thinking to Assist Wind Down
THE PLANETS: Section 341(a) Meeting Scheduled for Nov. 5
VALLEY CLUB HOMES: General Unsecured Claims Will Be Paid in Full
VERASUN ENERGY: Case Summary & 30 Largest Unsecured Creditors
VERASUN ENERGY: Files for Chapter 11 Bankruptcy in Delaware
VERIZON COMMS: Moody's Junks Rating on $2.3BB Alltel Notes
VISKASE COMPANIES: Moody's Affirms Caa1 CFR; Outlook Negative
WENDY'S INTERNATIONAL: Moody's Cuts CFR to B1; Outlook Stable
WORKFLOW MANAGEMENT: Moody's Cuts CFR to Caa3; Developing Outlook
X-RITE INCORPORATED: Sagard Capital Discloses 15.1% Equity Stake
* Charles A. Stanziale, Jr., et al., Joins McCarter & English
* Moody's Sees Likely Failure of CDS Market Participants
* BOND PRICING: For the Week of Oct. 12 - Oct. 18, 2008
*********
3 DAY: Section 341(a) Meeting Scheduled for November 24
-------------------------------------------------------
The U.S. Trustee for the Central District of California will
convene a meeting of 3 Day Blinds, Inc.'s creditors on
Nov. 24, 2008, at 1:00 p.m., at Room 1-154, 411 West Fourth
Street, Santa Ana, California 92701.
This is the first meeting of creditors required under Section
341(a) of the U.S. Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
Anaheim, California-based 3 Day Blinds, Inc., filed for Chapter 11
protection on Oct. 21, 2008 (Bankr. C. D. Calif. Case. No. 08-
16696). Christopher O. Rivas, Esq., at Reed Smith LLP, and Daniel
A. Lev, who has an office in Los Angeles, California, represent
the Debtor in its restructuring effort.
ACM-TEXAS: Section 341(a) Meeting Scheduled for November 4
----------------------------------------------------------
The U.S. Trustee for the Western District of Texas will convene a
meeting of ACM-Texas, LLC's creditors on Nov. 4, 2008, at 11:45
a.m., at Midland Room 207.
This is the first meeting of creditors required under Section
341(a) of the U.S. Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
Creditors must file proofs of claim by Feb. 2, 2009.
Van Horn, Texas-based ACM-Texas, LLC, filed for Chapter 11
protection on Oct. 10, 2008 (Bankr. W. D. Texas Case No. 08-
70200). Alvaro Martinez, Jr., Esq., who has an office at 1703
North Big Spring, Midland, Texas, represents the Debtor in its
restructuring effort. The company listed assets of $19,000,000
and debts of $2,020,580.
ADVANCED MICRO: Cash Payment for DTV Deal Cut to $141.5 Million
---------------------------------------------------------------
Advanced Micro Devices, Inc., disclosed in a Securities and
Exchange Commission filing that it, Broadcom Corporation, and
Broadcom International Limited have executed Amendment No. 1 to an
Asset Purchase Agreement, dated Aug. 25, 2008.
Pursuant to the amended agreement, the aggregate cash purchase
price payable by Broadcom to the company was reduced from
$192.8 million to $141.5 million, less an adjustment for certain
employee-related expenses, and the dollar amount of the
indemnification escrow deposit was reduced from $19 million to
$14 million.
As a result of this purchase price reduction, the company recorded
an additional loss from the sale of approximately $51 million.
The loss will be reflected in the company's condensed consolidated
financial statements included in the company's Quarterly Report on
Form 10-Q for the quarter ending Sept. 27, 2008.
Pursuant to the amendment, certain representations, warranties,
and agreements were made relating to specified intellectual
property.
On Oct. 27, 2008, Advabced Micro completed the sale of its digital
television business to Broadcom and BIL. Pursuant to the terms
and subject to the conditions of the Amended Asset Purchase
Agreement, as consideration for the DTV Assets, Broadcom paid to
the company $141.5 million in cash, less an adjustment for certain
employee-related expenses. Around $14 million of the purchase
price was deposited in escrow for a period of 18 months following
the closing to satisfy any amount owed by the company to Broadcom
pursuant to the indemnification provisions of the Amended Asset
Purchase Agreement.
An additional $15 million of the purchase price was deposited in
escrow to be held until certain audited 2008 financial statements
for the acquired business have been delivered to Broadcom; the
escrow is subject to forfeiture or reduction in the event of non-
delivery or delay in delivery beyond certain agreed time periods.
About Advanced Micro
Headquartered in Sunnyvale, California, Advanced Micro Devices
Inc. (NYSE: AMD) -- http://www.amd.com/-- provides innovative
processing solutions in the computing, graphics and consumer
electronics markets.
At June 28, 2008, the company's consolidated balance sheet showed
$9.8 billion in total assets, $8.1 billion in total liabilities,
$189 million in minority interest in consolidated subsidiaries,
and $1.5 billion in total stockholders' equity.
* * *
As reported in the Troubled Company Reporter on Aug. 12, 2008,
Fitch has affirmed these ratings on Advanced Micro Devices Inc.:
Issuer Default Rating at 'B-'; Senior unsecured debt at 'CCC/RR6'
and Rating Outlook at Negative.
ALLIED WASTE: Earns $112.5 Million in Quarter Ended September 30
----------------------------------------------------------------
Allied Waste Industries, Inc. reported financial results for its
third quarter and nine-months ended Sept. 30, 2008.
Net income for three months ended Sept. 30, 2008, was
$112.5 million compared to net income of $27.2 million for the
same period in the previous year.
For the quarter, income from continuing operations increased 68%
to $112.5 million. Prior year income from continuing operations
was $66.9 million.
Total revenue for the third quarter was a record $1.61 billion, an
increase of $50 million, or 3.2%, over $1.56 billion in the third
quarter 2007. Higher revenue for the quarter benefited from a
7.6% increase in average price, of which 370 basis points were
associated with the company's fuel recovery fee, partially offset
by a 4.4% decrease in volumes. Lower volumes for the quarter
primarily reflect the impact of U.S. economic conditions.
Cash flow from operations in the third quarter 2008 was
$281.3 million, compared with $284.2 million in the comparable
quarter last year. Free cash flow for the third quarter was
$144.7 million, compared with prior year free cash flow of
$168.8 million reflecting slightly higher capital expenditures in
the third quarter of 2008.
For nine months ended Sept. 30, 2008, the company's net income was
$296.5 million compared to net income of $158.3 million for the
same period in the previous year.
For the nine-month period ended Sept. 30, 2008, Allied Waste's
revenues were $4.67 billion, as pricing drove a $124.3 million
increase over the prior year. Operating income for the period
gained 13.3% to $862.1 million, inclusive of $45.0 million of
merger-related costs, losses from divestitures and asset
impairments. Income from continuing operations was $296.5 million
for the first nine months of 2008, compared with $192.2 million
for the comparable 2007 period.
At Sept. 30, 2008, the company's balance sheet showed total assets
of $13.9 billion, total liabilities of $9.7 billion and
shareholders' equity of $4.2 billion.
About Allied Waste
Based in Phoenix, Arizona, Allied Waste Industries Inc. (NYSE: AW)
-- http://www.alliedwaste.com/and http://www.disposal.com/--
provides waste collection, transfer, recycling and disposal
services to millions of residential, commercial and industrial
customers in over 100 major markets spanning 38 states and Puerto
Rico.
* * *
As reported in the Troubled Company Reporter on June 25, 2008,
Fitch Ratings placed the ratings of Allied Waste Industries Inc.
on Rating Watch Positive, including the company's CCC+/RR6 Senior
subordinated rating, following the announcement that the company
intends to merge with Republic Services Inc.
AMERICAN MEDIA: Extends Tender Offers to November 21
----------------------------------------------------
American Media Operations Inc. disclosed in a Securities and
Exchange Commission filing that it has extended the expiration
date for, and amended its cash tender offers and consent
solicitations in respect of, an aggregate of around $570 million
of its outstanding senior subordinated notes, consisting of:
-- $400,000,000 aggregate principal amount of 10.25% Series B
Senior Subordinated Notes due 2009 (CUSIP No. 02744RAH0) and
$14,544,000 aggregate principal amount of 10.25% Series B
Senior Subordinated Notes due 2009 (CUSIP No. 02744RAM9);
and
-- $150,000,000 aggregate principal amount of 8-7/8% Senior
Subordinated Notes due 2011 (CUSIP No. 02744RAK3) and
$5,454,000 aggregate principal amount of 8-7/8% Senior
Subordinated Notes due 2011 (CUSIP No. 02744RAP2).
The Tender Offers and Consent Solicitations, which were originally
scheduled to expire at 11:59 p.m., New York City time, on
Sept. 25, 2008, and were previously extended until 5:00 p.m., New
York City time, on Oct. 28, 2008, are being further extended until
5:00 p.m., New York City time, on Nov. 21, 2008, unless further
extended. In addition, AMOI has amended the terms of the Tender
Offers and Consent Solicitations to provide that the Tender Offers
and Consent Solicitations are being made to holders of record of
Existing Notes as of 5:00 p.m. on Nov. 17, 2008. All other terms,
provisions and conditions of the Tender Offers and Consent
Solicitations will remain in full force and effect.
AMOI also said that it continues to be engaged in discussions with
an ad hoc committee of holders of Existing Notes regarding the
possible amendment of the Tender Offers and Consent Solicitations.
The Tender Offers and Consent Solicitations are being made
pursuant to the Offer to Purchase and Consent Solicitation
Statement, as amended, and the related Letter of Transmittal and
Consent, and the Consent Solicitation Statement, as amended, and
the related Letter of Consent, each dated Aug. 26, 2008, which
more fully set forth the terms of the Tender Offers and the
Consent Solicitations. Eligible holders who wish to receive the
total consideration must validly tender and not validly withdraw
their Existing Notes on or prior to the Expiration Time. All
other holders who wish to receive the consent payment must validly
consent and not validly revoke their consents on or prior to the
Expiration Time.
J.P. Morgan Securities Inc. is acting as the Dealer Manager for
the Tender Offers and Solicitation Agent for the Consent
Solicitations and can be contacted at (212) 357-0775 (collect).
MacKenzie Partners, Inc. is acting as the Information Agent for
the Tender Offers and Consent Solicitations as well as Tabulation
Agent for the Consent Solicitations. Requests for documentation
relating to the Tender Offers and Consent Solicitations may be
directed to the Information Agent at (800) 322-2885 (toll free)
and (212) 929-5500 (collect).
About American Media Inc.
Headquartered in Boca Raton, Florida, American Media Operations
Inc., is a publisher of celebrity, health and fitness, and Spanish
language magazines, including Star, Shape, Men's Fitness, Fit
Pregnancy, Natural Health, and The National Enquirer. AMI also
owns Distribution Services Inc.
American Media Operations Inc. disclosed in a Securities and
Exchange Commission filing that as of June 30, 2008, it balance
sheet showed $891.6 million in total assets, $1.29 billion in
total liabilities, resulting to $398.7 million in shareholders'
deficit.
AMOI posted $388,000 in net profit on $118.8 million in net
revenues for quarter ended June 30, 2008, compared with $123,000
in net losses on $121.1 million in net revenues for quarter ended
June 30, 2007.
As of June 30, 2008, the company had cash and cash equivalents of
$19.6 million, $26.0 million outstanding on its revolving credit
facility, and a working capital deficit of $467.0 million.
* * *
As reported in the Troubled Company Reporter on Sept. 3, 2008,
Standard & Poor's Ratings Services said that American Media
Operations Inc.'s (CCC+/Negative/--) announcement that it has
commenced a tender offer for its $414.5 million 10-1/4% senior
subordinated notes due 2009 and its $155.5 million 8% senior
subordinated notes due 2011 at par value does not currently affect
the rating or outlook on the company.
AMERICHIP INTERNATIONAL: Retains Crusader Securities as Adviser
---------------------------------------------------------------
AmeriChip International Inc. disclosed in a Securities and
Exchange Commission filing that it has retained Crusader
Securities to assist it in advancing its strategic objectives.
Crusader Financial Group is a national financial services company
providing investment banking services and asset management to
institutional and retail clients. Through its wholly owned
subsidiaries, CFG is a registered broker/dealer (member FINRA), a
New York State registered investment advisor, a New York State
commercial real estate broker, and a residential mortgage broker
in Florida and California.
About AmeriChip International
Based in Clinton Township, Mich., AmeriChip International Inc.
(OTC BB: ACHI.OB) -- http://www.americhiplacc.com/-- holds a
patented technology known as Laser Assisted Chip Control, which
can be used to re-engineer the manufacturing process for
industrial metal machining applications.
According to AmeriChip International, this technology, when
implemented by the customer, will eliminate dangerous ribbon-like
steel chips that tangle around moving tool parts, automation
devices and other components essential to the machine processing
of low to medium grade carbon steels and non-ferrous metal parts.
Going Concern Doubt
As reported in the Troubled Company Reporter on March 13, 2008,
Jewett, Schwartz, Wolfe & Associates, in Hollywood, Fla.,
expressed substantial doubt about Americhip International Inc.'s
ability to continue as a going concern after auditing the
company's consolidated financial statements for the year ended
Nov. 30, 2007. The auditing firm pointed to the company's
recurring losses from operations.
AmeriChip International Inc.'s balance sheet as of Aug. 31, 2008,
showed $6,750,114 in total assets, $6,945,282 in total
liabilities, resulting to $198,581 in shareholders' deficit.
The company also had $34,935,799 in accumulated deficit.
At Aug. 31, 2008, the company's consolidated balance sheet also
showed strained liquidity with $842,781 in total current assets
available to pay $4,562,016 in total current liabilities.
AmeriChip International posted $1,188,032 in net losses on
$572,376 in net revenues for the three months ended Aug. 31, 2008,
compared with $102,598 in net losses on $863,826 in net revenues
for three months ended Aug. 31, 2007.
The company's material recurring losses from operations,
accumulated deficit, limited cash, negative working capital, among
others, indicate that it may be unable to continue as a going
concern for a reasonable period of time.
AMERICHIP INTERNATIONAL: Will Acquire OrbitForm Group
-----------------------------------------------------
AmeriChip International Inc. disclosed in a Securities and
Exchange Commission filing that on Oct. 28, 2008, subject to
certain terms and conditions of an agreement signed between the
company and OrbitForm Group, it has agreed to acquire all the
issued and outstanding common stock of Orbitform.
Orbitform manufactures forming, fastening, joining, and assembly
equipment for a wide range of industries and applications. The
company provides world-class prototype engineering services for
assembly of parts and specialized forming and fastening.
Orbitform has been profitable in each of the last three years with
annual sales ranging from $13 to $16 million.
The material terms of the contemplated agreement are as follows:
AmeriChip will acquire 100% of Orbitform and Orbitform will have a
retained equity position in AmeriChip of 50%. It is contemplated
that the acquisition will be completed in the first quarter of the
company's fiscal year. Upon completion Orbitform will name three
new members to the Board of Directors of AmeriChip.
About AmeriChip International
Based in Clinton Township, Mich., AmeriChip International Inc.
(OTC BB: ACHI.OB) -- http://www.americhiplacc.com/-- holds a
patented technology known as Laser Assisted Chip Control, which
can be used to re-engineer the manufacturing process for
industrial metal machining applications.
According to AmeriChip International, this technology, when
implemented by the customer, will eliminate dangerous ribbon-like
steel chips that tangle around moving tool parts, automation
devices and other components essential to the machine processing
of low to medium grade carbon steels and non-ferrous metal parts.
Going Concern Doubt
As reported in the Troubled Company Reporter on March 13, 2008,
Jewett, Schwartz, Wolfe & Associates, in Hollywood, Fla.,
expressed substantial doubt about Americhip International Inc.'s
ability to continue as a going concern after auditing the
company's consolidated financial statements for the year ended
Nov. 30, 2007. The auditing firm pointed to the company's
recurring losses from operations.
AmeriChip International Inc.'s balance sheet as of Aug. 31, 2008,
showed $6,750,114 in total assets, $6,945,282 in total
liabilities, resulting to $198,581 in shareholders' deficit.
The company also had $34,935,799 in accumulated deficit.
At Aug. 31, 2008, the company's consolidated balance sheet also
showed strained liquidity with $842,781 in total current assets
available to pay $4,562,016 in total current liabilities.
AmeriChip International posted $1,188,032 in net losses on
$572,376 in net revenues for the three months ended Aug. 31, 2008,
compared with $102,598 in net losses on $863,826 in net revenues
for three months ended Aug. 31, 2007.
The company's material recurring losses from operations,
accumulated deficit, limited cash, negative working capital, among
others, indicate that it may be unable to continue as a going
concern for a reasonable period of time.
AMERICHIP INT'L: Will Sell 50% of KSI Machine to James Kotsonis
---------------------------------------------------------------
AmeriChip International Inc. disclosed in a Securities and
Exchange Commission filing that on Oct.28, 2008, subject to
certain terms and conditions of an agreement signed with and James
Kotsonis, of Washington, Township, Michigan, the company has
agreed to sell to Mr. Kotsonis a 50% interest in AmeriChip's
wholly owned subsidiary KSI Machine and Engineering Inc. by
retiring the promissory note for $2,600,000 held by Mr. Kotsonis.
About AmeriChip International
Based in Clinton Township, Mich., AmeriChip International Inc.
(OTC BB: ACHI.OB) -- http://www.americhiplacc.com/-- holds a
patented technology known as Laser Assisted Chip Control, which
can be used to re-engineer the manufacturing process for
industrial metal machining applications.
According to AmeriChip International, this technology, when
implemented by the customer, will eliminate dangerous ribbon-like
steel chips that tangle around moving tool parts, automation
devices and other components essential to the machine processing
of low to medium grade carbon steels and non-ferrous metal parts.
Going Concern Doubt
As reported in the Troubled Company Reporter on March 13, 2008,
Jewett, Schwartz, Wolfe & Associates, in Hollywood, Fla.,
expressed substantial doubt about Americhip International Inc.'s
ability to continue as a going concern after auditing the
company's consolidated financial statements for the year ended
Nov. 30, 2007. The auditing firm pointed to the company's
recurring losses from operations.
AmeriChip International Inc.'s balance sheet as of Aug. 31, 2008,
showed $6,750,114 in total assets, $6,945,282 in total
liabilities, resulting to $198,581 in shareholders' deficit.
The company also had $34,935,799 in accumulated deficit.
At Aug. 31, 2008, the company's consolidated balance sheet also
showed strained liquidity with $842,781 in total current assets
available to pay $4,562,016 in total current liabilities.
AmeriChip International posted $1,188,032 in net losses on
$572,376 in net revenues for the three months ended Aug. 31, 2008,
compared with $102,598 in net losses on $863,826 in net revenues
for three months ended Aug. 31, 2007.
The company's material recurring losses from operations,
accumulated deficit, limited cash, negative working capital, among
others, indicate that it may be unable to continue as a going
concern for a reasonable period of time.
ARBY'S RESTAURANT: Moody's Cuts CFR to B2; Outlook Negative
-----------------------------------------------------------
Moody's Investors Service lowered Arby's Restaurant Group, Inc.'s
(Arby's) corporate family rating (CFR) to B2 from B1 and
probability of default rating (PDR) to B3 from B2. In addition,
Moody's lowered Arby's senior secured ratings to B1 (LGD3, 30%)
from Ba3 (LGD2, 28%). The outlook is negative.
Ratings lowered are:
Corporate family rating lowered to B2 from B1
Probability of default rating lowered to B3 from B2
Guaranteed senior secured revolving credit facility, due July 25,
2011, lowered to B1 (LGD3, 30%) from Ba3 (LGD 2, 28%)
The outlook is negative
The downgrade of the CFR to B2 from B1 reflects Arby's weaker than
expected operating performance due in-part to a persistently weak
consumer environment and high cost inflation that has resulted in
debt protection metrics that are more representative of the
revised ratings.
The B2 corporate family rating (CFR) reflects Arby's high leverage
and weak debt protection metrics, as well as Moody's view that the
cushion under its financial covenants is modest and may require
the company to seek amendments from its lenders. The ratings are
supported by Arby's reasonable level of brand awareness in its
core markets, meaningful scale with approximately 3,600 units, and
good distribution between its lunch and dinner day parts.
The B1 senior secured rating reflects the bank facilities' first
lien position in the capital structure as well as the material
amount of liabilities that are ranked junior to this facility.
This should provide a sufficient enough cushion for these secured
lenders in a distress situation that result in a rating one notch
above the CFR.
The negative outlook reflects the modest cushion under Arby's bank
covenants and the uncertainty over the company's ability to
materially improve the cushion through stronger operating
performance over the near term. This is due to the expectation
that a weak consumer environment, cost inflation, and competitive
pressures will persist over the intermediate term. Should Arby's
have difficulty meeting its bank financial covenants, it could
cause it to seek an amendment or waiver from its banks. Given the
very difficult macro-economic and banking environment, this could
result in Arby's obtaining more stringent and expensive terms from
its banks than currently exist.
The most recent rating action on Arby's was the affirmation of the
ratings and negative outlook on April 24, 2008.
Arby's Restaurant Group, Inc. (Arby's) owns, operates and
franchises quick service restaurant (QSR) concepts that specialize
in the sandwich segment of the restaurant industry. As of June 30,
2008, Arby's owned approximately 1,170 restaurants and franchised
an additional 2,550, the majority of which are in the U.S.
Arby's, which generated revenues of approximately $1.2 billion for
the twelve month period ending June 30, 2008, is a wholly-owned
subsidiary of Wendy's/Arby's Group Inc. (Wendy's/Arby's).
ARLINGTON RIDGE: Taps Algon Capital as Financial Advisers
---------------------------------------------------------
Arlington Ridge LLC and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Middle District of Florida for authority
to employ Algon Capital, LLC, dba Algon Group, as their financial
advisers and Lawrence S. Comegys of Algon Group as chief
restructuring officer.
Algon Group is a specialized financial advisory and investment
banking firm while Mr. Comegys is a former president of Pulte
Homes, Florida Region, former president and chief operating
officer of Jim Walter Homebuilding Group, and former president of
Meritage Homes, Florida Region.
Algon will mainly assist and advise the Debtors in connection with
the development of a Chapter 11 plan of reorganization.
The Debtors agree to indemnify Algon against any action,
proceeding or investigation in connection with its performance of
the services contemplated under the engagement agreement dated
Oct. 11, 2008, provided that said involvement is not a result of
gross negligence or willful malfeasance in the performance of such
services.
As compensation for their services, Algon's professionals
currently bill:
Professional Hourly Rate
------------ -----------
Lawrence Comegys $500
Troy Taylor $500
Paul Rubin $450
Karen Burns $400
The Debtors have agreed to pay Algon a $25,000 retainer, which
will be applied to Algon's final invoice. The retainer will be
funded from the Debtors' post-petition financing facility.
Troy Taylor, a principal officer of Algon Capital, assures the
Court that the firm does not represent any interest adverse to the
Debtors or their estates, and that it is a "disinterested person"
as that term is defined under Sec. 101(14) of the Bankruptcy Code.
About Arlington Ridge
Saint Petersburg, Florida-based Arlington Ridge LLC is the owner
and developer of approximately 492 acres of real property located
in Lake County, Florida, approximately seven (7) miles south of
downton Leesburg. Arlington acquired the Development in December
of 2003. The companies filed for Chapter 11 protection on Oct. 8,
2008 (Bankr. M. D. Fla. Lead Case No. 08-15678). In Court
filings, Arlington Ridge listed assets of $10 million to
$50 million, and debts of $10 million to $50 million.
ARLINGTON RIDGE: Asks Emergency Authority to Borrow up to $1.1MM
----------------------------------------------------------------
Arlington Ridge LLC and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Middle District of Florida for emergency
authority to borrow from Michael A. Kass up to $1.1 million to
fund the costs of completion of homes now under construction in
their Lake County, Florida Development Project.
The Debtors tell the Court that the proposed financing is in their
best interest and the best interest of their creditors and other
parties-in-interest.
The DIP financing will be secured by priming liens on and security
interests in the Debtors' assets and property consisting of 20
single family homes and 17 "Villa Townhomes" located in Lake
County, Florida, approximately seven miles south of downtown
Leesburg.
The provisions of the proposed DIP financing are:
DIP Amount: up to $1.1 million
Interest Rate: fixed at 14% p.a. payable monthly in arrears
Origination Fees: $22,000
Optional The Debtors may repay the DIP Loans in whole
Repayments: or in part from excess cash.
Liens: mortgage on, security interest, and lien on
the Collateral, senior to liens of Wachovia
and all liens or claims junior to those of
Wachovia. The Lender will not be granted a
lien on any claim or cause of action arising
under Sections 544, 545, 547, 548, 549 or
553(b) of the Bankruptcy Code.
Administrative The Debtor's obligations to repay the Lender
Claims: under the terms of the DIP Loans shall be
accorded superpriority administrative expense
status pursuant to Sec. 364(c)(1) of the
Bankruptcy Code, subject to a Carve-Out.
Term and The Termination Date for the DIP Loan will be
Termination: from six months to one year from the date of
the entry of the final order granting this
Motion, unless terminated earlier pursuant to
the occurrence of an Event of Termination or
extended by agreement between the Debtors and
the Lender.
Carve-Outs: The DIP Liens and Superpriority Claim are
subordinate only to the payment of (i)
postpetition professional expenses as approved
by the Court; (ii) fees required to be paid to
the Clerk of the Court; (iii) quarterly fees
required to be paid to the United States
Trustee; and (iv) Arlington Ridge Community
Development District (CDD) assessment liens.
Events of The DIP Loan Documents contain standard
Termination: default provisions as events of termination,
including (i) the failure to pay the DIP Loans
in full, with interest, by the Maturity Date;
(ii) the Debtors ceasing to operate; (iii) the
dismissal or conversion of the Chapter 11
cases; (iv) the appointment of a trustee or an
examiner with expanded powers; (v) the entry
of an order granting relief from the automatic
stay to any party as to any property of the
estate; (vi) entry of an order approving the
transfer of the collateral to a party other
than the Lender and other than in the ordinary
course of business; provided, however, that
this covenant shall not impact the Debtor's
ability to sell Units; (vii) confirmation of a
plan of reorganization which does not provide
for the treatment of the DIP Loans in the same
manner as provided in the Motion and the DIP
Loan Documents.
Break-Up-Fee: Should another entity be chosen as the final
DIP lender, then $5,000 shall be paid to
Michael A. Kass as a fee for his costs and
expenses of this transaction.
Superpriority Administrative Expense Status
As additional assurance that the DIP Loans will be repaid, the
Lender will be granted and allowed a superpriority administrative
expense claim in accordance with Sec. 364(c) of the Bankruptcy
Code, subject only to the Carve-Out.
Pre-Petition Debts
The Debtors tell the Court that as of the petition date, Wachovia
Bank, N.A, the Debtors' prepetition lender, contends that it is
owed approximately $17,439,976 under the A&D Loan, which was used
to refinance the acquisition of the land and to fund the
development, and $5,191,915 under the Builders' line of credit,
which was used to fund the construction of homes at the Project.
The Debtors add that as of the petition date, Arlington Ridge
Community Development District who issued the bonds to fund the
acquisition of common improvements and amenities for the Project,
contends that it is owed approximately $12,483,552 for the bond
debt, and an operational maintenance assessment of $1,165,511.
Arlington Ridge CDD will assert that it has perfected liens on the
real estate with priority over all liens against the real estate,
and that Wachovia Bank will assert that it has perfected security
interests in or mortgages on the Collateral having priority over
all other liens, other than property taxes and debts owed to the
Arlington Ridge CDD, including the bonded indebtedness.
About Arlington Ridge
Saint Petersburg, Florida-based Arlington Ridge LLC is the owner
and developer of approximately 492 acres of real property located
in Lake County, Florida, approximately seven miles south of
downtown Leesburg. Arlington acquired the Development in December
2003. The companies filed for Chapter 11 protection on Oct. 8,
2008 (Bankr. M. D. Fla. Lead Case No. 08-15678). In Court
filings, Arlington Ridge listed assets of $10 million to
$50 million, and debts of $10 million to $50 million.
ARLINGTON RIDGE: Section 341(a) Meeting Scheduled for Nov. 5
------------------------------------------------------------
The U.S. Trustee for the Middle District of Florida will convene a
meeting of Arlington Ridge LLC's creditors on
Nov. 5, 2008, at 1:30 p.m., at Room 100-B, Timberlake Annex, 501
East Polk Street, Tampa, Florida.
This is the first meeting of creditors required under Section
341(a) of the U.S. Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
Saint Petersburg, Florida-based Arlington Ridge LLC and its
affiliates operate a retirement community. The companies filed
for Chapter 11 protection on Oct. 8, 2008 (Bankr. M. D. Fla. Case
No. 08-15678). The company listed assets of $10 million to $50
million, and debts of $10 million to $50 million.
ATA AIRLINES: Court OKs BMC's Review of Avoidance Claims
--------------------------------------------------------
ATA Airlines obtained a court ruling authorizing its claims and
noticing agent, BMC Group, to assist the airline in analyzing
potential avoidance actions under Chapter 5 of the Bankruptcy
Code.
BMC Group, however, according to the U.S. Bankruptcy Court for the
Southern District of Indiana, Indianapolis Division, is not
authorized to provide these services:
(1) Application of new value and ordinary course defenses to
remaining vendors and performance of data analysis to
determine the most likely recoverable amount.
(2) Utilizing new value and ordinary course analysis,
provision of custom reports stratifying potential
performance of data analysis to determine the most likely
recoverable amount.
The Court directed ATA Airlines not to grant BMC Group
authorization to render those services without further ruling or
without an agreement among JPMorgan Chase Bank, the Official
Committee of Unsecured Creditors and the airline permitting the
agent to provide those services.
About ATA Airlines
Headquartered in Indianapolis, Indiana, ATA Airlines, Inc., is a
diversified passenger airline operating in two principal business
lines -- a low cost carrier providing scheduled passenger service
that leverages a code share agreement with Southwest Airlines; and
a charter operator that focused primarily on providing charter
service to the U.S. government and military. ATA is a wholly
owned subsidiary of New ATA Acquisition, Inc. -- a wholly owned
subsidiary of New ATA Investment, Inc., which in turn, is a wholly
owned subsidiary of Global Aero Logistics Inc. ATA Acquisition
also owns another holding company subsidiary, World Air Holdings,
Inc., which it acquired through merger on August 14, 2007. World
Air Holdings owns and operates two other airlines, North American
Airlines and World Airways.
ATA Airlines and its affiliates filed for Chapter 11 protection on
Oct. 26, 2004 (Bankr. S.D. Ind. Case Nos. 04-19866, 04-19868
through 04-19874). The Honorable Basil H. Lorch III confirmed the
Debtors' plan of reorganization on Jan. 31, 2006. The Debtors'
emerged from bankruptcy on Feb. 28, 2006.
Global Aero Logistics acquired certain of ATA's operations after
its first bankruptcy. The remaining ATA affiliates that were not
substantively consolidated in the company's first bankruptcy case
were sold or otherwise liquidated.
ATA Airlines filed for Chapter 22 on April 2, 2008 (Bankr. S.D.
Ind. Case No. 08-03675), citing the unexpected cancellation of a
key contract for ATA's military charter business, which made it
impossible for ATA to obtain additional capital to sustain its
operations or restructure the business. ATA discontinued all
operations subsequent to the bankruptcy filing. ATA's Chapter 22
bankruptcy petition lists assets and liabilities each in the range
of $100 million to $500 million.
The Debtor is represented in its Chapter 22 case by Haynes and
Boone, LLP, and Baker & Daniels, LLP, as bankruptcy counsel.
The United States Trustee for Region 10 appointed five members to
the Official Committee of Unsecured Creditors. Otterbourg,
Steindler, Houston & Rosen, P.C., serves as bankruptcy counsel to
the Committee. FTI Consulting, Inc., acts as the panel's
financial advisors. The Court gave ATA Airlines Inc. until
Feb. 26, 2009, to file its Chapter 11 plan and April 27, 2009, to
solicit acceptances of that plan.
(ATA Airlines Bankruptcy News; Bankruptcy Creditors' Services Inc.
http://bankrupt.com/newsstand/or 215/945-7000).
ATA AIRLINES: Deadline for Bids Set as AAI Dropped as Lead Bidder
-----------------------------------------------------------------
ATA Airlines sought and obtained approval from the U.S. Bankruptcy
Court for the Southern District of Indiana, Indianapolis Division,
to implement a set of solicitation and bidding procedures for the
sale of its business.
The assets to be sold consist of contracts, intellectual property,
computer database and software and authorizations that allow it to
operate as a commercial airline. The airline is also selling off
its airport operating authorities or slots at LaGuardia Airport in
New York and Ronald Reagan Washington National Airport in
Washington, D.C.
The assets do not include ATA Airlines' remaining L1011 aircraft,
engines, cash, cash equivalents, among other things.
ATA Airlines previously proposed to the Court to designate
American Aviation Investment as the buyer for the assets, subject
to higher and better offers. The airline, however, withdrew its
proposal at the Oct. 7 hearing in favor of trying to establish
rules and guidelines for the solicitation and submission of bid
proposals for the assets.
ATA Airlines proposed this set of rules and procedures that will
govern the solicitation and submission of proposals for the
acquisition of its business:
(1) Within two days after entry of an order approving the
proposed procedure, ATA Airlines will serve a copy of the
order to all parties that have previously expressed an
interest to acquire the business, the U.S. Trustee,
JPMorgan Chase Bank, counsel for the Official Committee of
Unsecured Creditors and other concerned parties.
(2) All bid proposals must conform to these requirements:
(a) Each bid proposal must be in writing and must contain
the terms and conditions regarding a proposed sale or
other transfer of the Business through a stock
transaction, which may include the assumption and
assignment of executory contracts and unexpired
leases. Each proposal must contemplate the
implementation of the proposed sale transaction
through a chapter 11 plan to be filed in ATA Airlines'
bankruptcy case.
ATA Airlines is not soliciting and will not accept any
bid proposals that do not contemplate the acquisition
of the business through a stock transaction or that
contemplate the acquisition of its operating
certificate or slots at LaGuardia Airport as stand-
alone assets.
Each bid proposal will be subject to bankruptcy court
approval but cannot contain any financing contingency.
(b) The person or entity making the bid proposal must
deliver to ATA Airlines on or before November 3, 2008,
at 5:00 p.m., eastern time, these documents:
* copies of financial statements, letters of credit,
and any other documents satisfactory to ATA Airlines
evidencing the prospective purchaser's ability to
consummate the transaction;
* information and assurances that there is no
regulatory issue that would prevent the prospective
purchaser from fulfilling the terms, conditions, and
obligations under the proposed sale transaction; and
* the bid proposal.
ATA Airlines, in its sole discretion, has the right to
determine the adequacy of the information and documents.
(c) The entity making a bid proposal must also tender to
ATA Airlines a deposit, in cash or cash equivalent in
an amount equal to 50% of the consideration specified
in the proposal on or before the deadline. ATA
Airlines will maintain each deposit in a segregated,
non-interest bearing account.
(d) All bid proposals must provide net cash consideration
to the bankruptcy estate of at least $750,000.
(e) No letter of intent or other written proposal
submitted to ATA Airlines prior to the filing of the
motion in connection with the acquisition will be
considered as a bid proposal.
(f) To assist prospective purchasers in their evaluation
of the assets, ATA Airlines will provide access to
information and documentation related to the
assets during normal business hours. Only those
parties that will sign a confidentiality agreement in
a form acceptable to ATA Airlines will be provided
with access to the information.
(g) On or before the status conference, ATA Airlines, in
its sole discretion, but in consultation with JPMorgan
and the Creditors Committee, will determine which bid
proposal is the highest and best offer for the sale or
other transfer of the business. These factors will
influence ATA Airlines' determination:
* the consideration offered to be paid;
* the potential purchaser's financial strength and
ability to timely close on the proposed transaction;
* any consent issues surrounding the assumption and
assignment of executory contracts and unexpired
leases; and
* any regulatory issues implicated by the proposed
sale transaction.
ATA Airlines has the right, in its sole discretion, to
waive any technical violation of, or deviation from, the
bid procedures consistent with the goal of maximizing the
sale price for the assets.
About ATA Airlines
Headquartered in Indianapolis, Indiana, ATA Airlines, Inc., is a
diversified passenger airline operating in two principal business
lines -- a low cost carrier providing scheduled passenger service
that leverages a code share agreement with Southwest Airlines; and
a charter operator that focused primarily on providing charter
service to the U.S. government and military. ATA is a wholly
owned subsidiary of New ATA Acquisition, Inc. -- a wholly owned
subsidiary of New ATA Investment, Inc., which in turn, is a wholly
owned subsidiary of Global Aero Logistics Inc. ATA Acquisition
also owns another holding company subsidiary, World Air Holdings,
Inc., which it acquired through merger on August 14, 2007. World
Air Holdings owns and operates two other airlines, North American
Airlines and World Airways.
ATA Airlines and its affiliates filed for Chapter 11 protection on
Oct. 26, 2004 (Bankr. S.D. Ind. Case Nos. 04-19866, 04-19868
through 04-19874). The Honorable Basil H. Lorch III confirmed the
Debtors' plan of reorganization on Jan. 31, 2006. The Debtors'
emerged from bankruptcy on Feb. 28, 2006.
Global Aero Logistics acquired certain of ATA's operations after
its first bankruptcy. The remaining ATA affiliates that were not
substantively consolidated in the company's first bankruptcy case
were sold or otherwise liquidated.
ATA Airlines filed for Chapter 22 on April 2, 2008 (Bankr. S.D.
Ind. Case No. 08-03675), citing the unexpected cancellation of a
key contract for ATA's military charter business, which made it
impossible for ATA to obtain additional capital to sustain its
operations or restructure the business. ATA discontinued all
operations subsequent to the bankruptcy filing. ATA's Chapter 22
bankruptcy petition lists assets and liabilities each in the range
of $100 million to $500 million.
The Debtor is represented in its Chapter 22 case by Haynes and
Boone, LLP, and Baker & Daniels, LLP, as bankruptcy counsel.
The United States Trustee for Region 10 appointed five members to
the Official Committee of Unsecured Creditors. Otterbourg,
Steindler, Houston & Rosen, P.C., serves as bankruptcy counsel to
the Committee. FTI Consulting, Inc., acts as the panel's
financial advisors. The Court gave ATA Airlines Inc. until
Feb. 26, 2009, to file its Chapter 11 plan and April 27, 2009, to
solicit acceptances of that plan.
(ATA Airlines Bankruptcy News; Bankruptcy Creditors' Services Inc.
http://bankrupt.com/newsstand/or 215/945-7000).
ATA AIRLINES: Obtains Court OK to Sell Aircraft to Flight Support
-----------------------------------------------------------------
ATA Airlines obtained approval from the U.S. Bankruptcy Court for
the Southern District of Indiana, Indianapolis Division, to sell
an aircraft and other properties for $2.5 million to Flight
Support.
In its order dated Oct. 15, the Court permitted the airline to
sell its L1011 aircraft, spare engines, tooling and other assets
pursuant to the terms of its purchase agreement with Flight
Support, saying the sale will provide "greater recovery for [ATA
Airlines'] creditors than would be provided by any other
practical available alternative."
ATA Airlines previously considered the sale of the assets at an
auction with Flight Support as merely one of the buyers. The
airline, however, has not received bids for the assets.
Aside from the $2.5 million that Flight Support will pay for the
assets, the company will also assume all liens, claims and other
interests in the assets except those held by JPMorgan Chase Bank.
ATA Airlines will be discharged of any liability for the payment
of those claims or other interests in the assets including any
deficiency claims.
Meanwhile, AAR Aircraft Service will retain its "possessory lien"
on aircraft N160AT and N161AT for $4,280 in storage fees, which it
incurred for the aircraft. AAR is not required to turn over the
aircraft without the company receiving full payment of those fees.
About ATA Airlines
Headquartered in Indianapolis, Indiana, ATA Airlines, Inc., is a
diversified passenger airline operating in two principal business
lines -- a low cost carrier providing scheduled passenger service
that leverages a code share agreement with Southwest Airlines; and
a charter operator that focused primarily on providing charter
service to the U.S. government and military. ATA is a wholly
owned subsidiary of New ATA Acquisition, Inc. -- a wholly owned
subsidiary of New ATA Investment, Inc., which in turn, is a wholly
owned subsidiary of Global Aero Logistics Inc. ATA Acquisition
also owns another holding company subsidiary, World Air Holdings,
Inc., which it acquired through merger on August 14, 2007. World
Air Holdings owns and operates two other airlines, North American
Airlines and World Airways.
ATA Airlines and its affiliates filed for Chapter 11 protection on
Oct. 26, 2004 (Bankr. S.D. Ind. Case Nos. 04-19866, 04-19868
through 04-19874). The Honorable Basil H. Lorch III confirmed the
Debtors' plan of reorganization on Jan. 31, 2006. The Debtors'
emerged from bankruptcy on Feb. 28, 2006.
Global Aero Logistics acquired certain of ATA's operations after
its first bankruptcy. The remaining ATA affiliates that were not
substantively consolidated in the company's first bankruptcy case
were sold or otherwise liquidated.
ATA Airlines filed for Chapter 22 on April 2, 2008 (Bankr. S.D.
Ind. Case No. 08-03675), citing the unexpected cancellation of a
key contract for ATA's military charter business, which made it
impossible for ATA to obtain additional capital to sustain its
operations or restructure the business. ATA discontinued all
operations subsequent to the bankruptcy filing. ATA's Chapter 22
bankruptcy petition lists assets and liabilities each in the range
of $100 million to $500 million.
The Debtor is represented in its Chapter 22 case by Haynes and
Boone, LLP, and Baker & Daniels, LLP, as bankruptcy counsel.
The United States Trustee for Region 10 appointed five members to
the Official Committee of Unsecured Creditors. Otterbourg,
Steindler, Houston & Rosen, P.C., serves as bankruptcy counsel to
the Committee. FTI Consulting, Inc., acts as the panel's
financial advisors. The Court gave ATA Airlines Inc. until
Feb. 26, 2009, to file its Chapter 11 plan and April 27, 2009, to
solicit acceptances of that plan.
(ATA Airlines Bankruptcy News; Bankruptcy Creditors' Services Inc.
http://bankrupt.com/newsstand/or 215/945-7000).
ATA AIRLINES: Starman Auction for Properties Net $16MM
------------------------------------------------------
Starman Bros. Auctions raked in more than $16,000,000 in gross
sales from the auction of ATA Airlines' properties in Dallas and
Indianapolis.
Starman's reports showed that it generated $2,397,721 from
auctioning off ATA Airlines' properties in Dallas while it raked
in $14,031,266 from the auction of the airline's assets in
Indianapolis. Properties that had been sold include aircraft-
related equipment and other items.
The auctioneer said it retained $95,908 as its commission from
the sale proceeds at the auction in Dallas while it retained
$675,487 as commission for the other auction. Starman also
separately charged and retained a 5% premium from each buyer, and
will retain $21,722 as reimbursement of the advertising costs and
other expenses it incurred from holding both auctions.
About ATA Airlines
Headquartered in Indianapolis, Indiana, ATA Airlines, Inc., is a
diversified passenger airline operating in two principal business
lines -- a low cost carrier providing scheduled passenger service
that leverages a code share agreement with Southwest Airlines; and
a charter operator that focused primarily on providing charter
service to the U.S. government and military. ATA is a wholly
owned subsidiary of New ATA Acquisition, Inc. -- a wholly owned
subsidiary of New ATA Investment, Inc., which in turn, is a wholly
owned subsidiary of Global Aero Logistics Inc. ATA Acquisition
also owns another holding company subsidiary, World Air Holdings,
Inc., which it acquired through merger on August 14, 2007. World
Air Holdings owns and operates two other airlines, North American
Airlines and World Airways.
ATA Airlines and its affiliates filed for Chapter 11 protection on
Oct. 26, 2004 (Bankr. S.D. Ind. Case Nos. 04-19866, 04-19868
through 04-19874). The Honorable Basil H. Lorch III confirmed the
Debtors' plan of reorganization on Jan. 31, 2006. The Debtors'
emerged from bankruptcy on Feb. 28, 2006.
Global Aero Logistics acquired certain of ATA's operations after
its first bankruptcy. The remaining ATA affiliates that were not
substantively consolidated in the company's first bankruptcy case
were sold or otherwise liquidated.
ATA Airlines filed for Chapter 22 on April 2, 2008 (Bankr. S.D.
Ind. Case No. 08-03675), citing the unexpected cancellation of a
key contract for ATA's military charter business, which made it
impossible for ATA to obtain additional capital to sustain its
operations or restructure the business. ATA discontinued all
operations subsequent to the bankruptcy filing. ATA's Chapter 22
bankruptcy petition lists assets and liabilities each in the range
of $100 million to $500 million.
The Debtor is represented in its Chapter 22 case by Haynes and
Boone, LLP, and Baker & Daniels, LLP, as bankruptcy counsel.
The United States Trustee for Region 10 appointed five members to
the Official Committee of Unsecured Creditors. Otterbourg,
Steindler, Houston & Rosen, P.C., serves as bankruptcy counsel to
the Committee. FTI Consulting, Inc., acts as the panel's
financial advisors. The Court gave ATA Airlines Inc. until
Feb. 26, 2009, to file its Chapter 11 plan and April 27, 2009, to
solicit acceptances of that plan.
(ATA Airlines Bankruptcy News; Bankruptcy Creditors' Services Inc.
http://bankrupt.com/newsstand/or 215/945-7000).
ATA AIRLINES: Wins OK for Mesirow As Advisor for FedEx Suit
-----------------------------------------------------------
ATA Airlines sought the U.S. Bankruptcy Court for the Southern
District of Indiana, Indianapolis Division's approval to employ
Mesirow Financial Consulting as financial consultant in connection
with the civil lawsuit it filed against Federal Express.
In its employment application filed with the Court, ATA Airlines
said it needs Mesirow to assist in investigating and quantifying
potential damages in the litigation.
"[Mesirow?s] resources, capabilities and experience in consulting
services with respect to distressed airline will be crucial to
the outcome of the FedEx litigation," said Terry Hall, Esq., at
Baker & Daniels, in Indianapolis, Indiana. "[Mesirow] will,
among other things, concentrate its efforts on investigating,
analyzing, and quantifying the Debtor?s possible damages in
connection with the FedEx litigation."
ATA Airlines filed the lawsuit after FedEx, which leads a team of
airline conducting military charter flights, booted the airline
out of the group early this year in alleged violation of their
2006 contract. The lawsuit seeks $180,000,000 in damages.
In return for Mesirow?s services, ATA Airlines proposed to pay
the firm at these hourly rates:
Professionals Rates
------------- -----------
Senior Managing Director/
Managing Director/Director $670 - $710
Senior Vice-President $580 - $640
Vice President $470 - $540
Senior Associate $370 - $440
Associate $220 - $320
Paraprofessional $90 - $190
In his affidavit filed with the Court, Lawrence Morriss, Jr.,
senior managing director of Mesirow, assured the Court that his
firm does not hold interest adverse to ATA Airlines and that it
is a "disinterested person" under Section 101 of the Bankruptcy
Code.
About ATA Airlines
Headquartered in Indianapolis, Indiana, ATA Airlines, Inc., is a
diversified passenger airline operating in two principal business
lines -- a low cost carrier providing scheduled passenger service
that leverages a code share agreement with Southwest Airlines; and
a charter operator that focused primarily on providing charter
service to the U.S. government and military. ATA is a wholly
owned subsidiary of New ATA Acquisition, Inc. -- a wholly owned
subsidiary of New ATA Investment, Inc., which in turn, is a wholly
owned subsidiary of Global Aero Logistics Inc. ATA Acquisition
also owns another holding company subsidiary, World Air Holdings,
Inc., which it acquired through merger on August 14, 2007. World
Air Holdings owns and operates two other airlines, North American
Airlines and World Airways.
ATA Airlines and its affiliates filed for Chapter 11 protection on
Oct. 26, 2004 (Bankr. S.D. Ind. Case Nos. 04-19866, 04-19868
through 04-19874). The Honorable Basil H. Lorch III confirmed the
Debtors' plan of reorganization on Jan. 31, 2006. The Debtors'
emerged from bankruptcy on Feb. 28, 2006.
Global Aero Logistics acquired certain of ATA's operations after
its first bankruptcy. The remaining ATA affiliates that were not
substantively consolidated in the company's first bankruptcy case
were sold or otherwise liquidated.
ATA Airlines filed for Chapter 22 on April 2, 2008 (Bankr. S.D.
Ind. Case No. 08-03675), citing the unexpected cancellation of a
key contract for ATA's military charter business, which made it
impossible for ATA to obtain additional capital to sustain its
operations or restructure the business. ATA discontinued all
operations subsequent to the bankruptcy filing. ATA's Chapter 22
bankruptcy petition lists assets and liabilities each in the range
of $100 million to $500 million.
The Debtor is represented in its Chapter 22 case by Haynes and
Boone, LLP, and Baker & Daniels, LLP, as bankruptcy counsel.
The United States Trustee for Region 10 appointed five members to
the Official Committee of Unsecured Creditors. Otterbourg,
Steindler, Houston & Rosen, P.C., serves as bankruptcy counsel to
the Committee. FTI Consulting, Inc., acts as the panel's
financial advisors. The Court gave ATA Airlines Inc. until
Feb. 26, 2009, to file its Chapter 11 plan and April 27, 2009, to
solicit acceptances of that plan.
(ATA Airlines Bankruptcy News; Bankruptcy Creditors' Services Inc.
http://bankrupt.com/newsstand/or 215/945-7000).
BEARINGPOINT INC: Misses NYSE's $100 Mln. Market Value Threshold
----------------------------------------------------------------
BearingPoint, Inc., disclosed in a Securities and Exchange
Commission filing that on Oct. 28, it was notified by the New York
Stock Exchange that it has fallen below the NYSE's continued
listing standard relating to minimum average market
capitalization. The NYSE's continued listing standard relating to
minimum average market capitalization applicable to the company
requires that the company have a minimum average market
capitalization of $100 million over a consecutive 30-day trading
period.
In accordance with the NYSE's rules, the company has informed the
NYSE of its intention to cure this deficiency and to submit a plan
by Dec. 12, 2008, demonstrating how it intends to do so.
The company continues to communicate with the NYSE regarding its
efforts to achieve compliance with the NYSE's continued listing
standards. Given that the company has, to date, been unable to
reach agreement regarding a sale of all or a portion of the
company's business, the company's Board of Directors recently
directed its financial advisors to approach holders of its various
series of subordinated, convertible debt to explore the
feasibility of restructuring all or selected series of its
convertible debt or exchanging existing convertible debt for
equity.
At present, the company has no indication of what, if any, terms
may be acceptable for any such restructuring and it can give no
assurance that any of its existing convertible debt can be
restructured or exchanged for equity in the near term or at all.
However, the company believes that some sale, restructuring of
indebtedness or combination of the two is likely to be a necessary
condition to achieving near-term compliance with the NYSE's
continued listing standard relating to minimum average market
capitalization and the company has previously communicated this
position to the NYSE.
The company has also failed to maintain a $1.00 minimum average
closing price, as required by NYSE continued listing standards,
and has announced that it will recommend to its shareholders for
approval a proposal for a reverse stock split at its next Annual
Meeting of Stockholders currently scheduled for Dec. 5, 2008. If
approved, the reverse stock split would be implemented with the
intention of attempting to cure the $1.00 minimum average closing
price continued listing standard deficiency.
The NYSE reserves the right to suspend trading in a company's
securities, regardless of the company's continued efforts to
comply with continued listing standards, if the NYSE decides the
trading price of a company's securities has become "abnormally
low." If the NYSE were to take such an action against the
company, the company would have the right to a review of this
determination by a Committee of the Board of Directors of NYSE
Regulation. Any application to delist the company's common shares
would be pending the completion of applicable procedures,
including any appeal by the company of the NYSE Regulation staff's
decision.
About BearingPoint Inc.
Headquartered in McLean, Virginia, BearingPoint, Inc. (NYSE:BE) --
http://www.bearingpoint.com-- is a provider of management and
technology consulting services to Global 2000 companies and
government organizations in more than 60 countries worldwide. The
company's core services include management consulting, technology
solutions, application services and managed services. In North
America, BearingPoint delivers consulting services through its
Public Services, Commercial Services and Financial Services
industry groups (North American Industry Groups), which provides
industry-specific knowledge and service offerings. Outside of
North America, BearingPoint operates in Europe, the Middle East
and Africa (EMEA); the Asia Pacific region, and Latin America
(including Mexico).
BearingPoint Inc.'s balance sheet at June 30, 2008, showed total
assets of $1.95 billion, total liabilities of $2.37 billion,
resulting in a stockholders' deficit of roughly $423 million.
The company related that its net income in the second quarter was
$18.5 million compared to a loss of $64.0 million in the second
quarter of 2007. The company's second quarter tax provision
includes an $18.9 million foreign corporate restructuring charge,
related to a reorganization of our European operations.
Cash balance was $350.9 million on June 30, 2008, compared to
$352.9 million on June 30, 2007.
BIOPURE CORP: Nasdaq Extends Compliance Period Until March 16
-------------------------------------------------------------
Biopure Corporation received notice from NASDAQ stating that the
company has until March 16, 2009, to regain compliance with
Marketplace Rule 4310(c)(4), requiring a minimum bid price of
$1.00 for continued listing. The deadline would have been
Dec. 8, 2008, but NASDAQ suspended enforcement of the minimum bid
price requirement because of turmoil in the marketplace, thereby
extending the company's time in which to gain compliance.
Currently, the company meets all other required inclusion criteria
for the NASDAQ Capital Market. If, at any time before March 16,
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 company will be provided written notification that it complies
with the Marketplace Rule.
Based in Cambridge, Massachusetts, Biopure Corporation (Nasdaq:
BPUR) -- http://www.biopure.com/-- develops, manufactures and
markets pharmaceuticals, called oxygen therapeutics, that are
intravenously administered to deliver oxygen to the body's
tissues. Hemopure(R) is approved for sale in South Africa for the
treatment of surgical patients who are acutely anemic. Biopure's
veterinary product Oxyglobin(R), the only oxygen therapeutic
approved for marketing by both the U.S. Food and Drug
Administration and the European Commission, is indicated for the
treatment of anemia in dogs.
Going Concern Doubt
As reported in the Troubled Company Reporter on Feb. 1, 2008,
Ernst & Young, in Boston, expressed substantial doubt about
Biopure Corporation's ability to continue as a going concern after
auditing the company's consolidated financial statements for the
years ended Oct. 31, 2007, and 2007. The auditing firm pointed to
the company's recurring losses from operations and lack of
sufficient funds to sustain its operations through the end of
fiscal 2008.
The company may not continue to qualify for continued listing on
the Nasdaq Capital Market. The company is out of compliance with
the $1.00 minimum bid price requirement for continued inclusion of
its class A common stock in the Nasdaq Stock Market. The company
has until Dec. 8, 2008, to regain compliance with the minimum bid
price requirement. If the company's securities are delisted, its
ability to raise funds will be adversely affected.
CANWEST MEDIA: Moody's Puts B1 Ratings on Review for Likely Cut
---------------------------------------------------------------
Moody's Investors Service placed the long term debt ratings of the
Canwest Media Inc. corporate family (Canwest) on review for
possible downgrade. The corporate family includes Canwest Limited
Partnership and CW Media Holdings Inc., whose ratings will also be
reviewed. The rating action was prompted by the likelihood that
rapidly deteriorating general economic conditions will suppress
advertising revenues while simultaneously causing business
enterprise values to fall. In addition to the increased risk that
credit protection measures will weaken, it is also more likely
that financial covenant measures will deteriorate and that
liquidity will be stressed. Moody's also believes that it is more
likely that Canwest will have to sell assets in order to address
2010/2011 refinancing milestones related to last year's
acquisition of the former Alliance Atlantis' specialty television
operations, and that the related divestiture proceeds will be
below earlier expectations. Moody's will examine a variety of
scenarios to assess near-to-mid term cash flow generation,
liquidity and the potential impact of obligations related to the
specialty television operations. The review is expected to be
completed expeditiously, well in advance of calendar year-end.
Outlook Actions:
-- Issuer: Canwest Media Inc.
Outlook, Changed To Rating Under Review From Negative
On Review for Possible Downgrade:
-- Issuer: Canwest Media Inc.
Corporate Family Rating, Placed on Review for Possible
Downgrade, currently B1
Probability of Default Rating, Placed on Review for Possible
Downgrade, currently B1
Senior Subordinated Regular Bond/Debenture, Placed on Review
for Possible Downgrade, currently B3 (LGD6, 92%)
-- Issuer: Canwest Limited Partnership
Senior Subordinated Regular Bond/Debenture, Placed on Review
for Possible Downgrade, currently B2 (LGD5, 70%)
Senior Secured Bank Credit Facility, Placed on Review for
Possible Downgrade, currently Ba2 (LGD2, 20%)
-- Issuer: CW Media Holdings Inc.
Senior Secured Bank Credit Facility, Placed on Review for
Possible Downgrade, currently Ba2 (LGD2, 20%)
Senior Unsecured Regular Bond/Debenture, Placed on Review
for Possible Downgrade, currently B2 (LGD5, 70%)
Moody's most recent rating action for Canwest was on June 25, 2008
at which time the ratings outlook was changed to negative from
positive and the corporate family's speculative grade liquidity
rating was downgraded to SGL-3 from SGL-2.
Canwest Media Inc. (CanWest) is wholly-owned by Winnipeg,
Manitoba, Canada-based Canwest Global Communications Corp., a
publicly traded international media company with interests in
broadcast television, publications, radio, specialty television
channels, out-of-home advertising and interactive operations in
Canada, Australia, Malaysia, Singapore, Indonesia, Turkey, the
United Kingdom and the United States. Substantially all of the
publicly traded parent company's operations are held though
Canwest.
CASTRO PROPERTY: Foreclosure Auction on Six Units Suspended
-----------------------------------------------------------
Brian Bandell at South Florida Business Journal reports that the
foreclosure auction of Domingo Castro's six units in the Singer
Island high-rise was suspended.
According to the Business Journal, the Tiara Condominium
Association was all set to sell the units at the auction until
Mr. Castro "deeded" them to Castro Property.
The Business Journal relates that a court ruling was issued on
Sept. 3, 2008, against Mr. Castro and his wife for $460,000 in
past-due association fees, setting the auction for Oct. 2, 2008.
Castro Property was created on Sept. 25, 2008, with Mr. Castro as
the managing member. The report says that Mr. Castro deeded the
six units to Castro Property for $10 each on Sept. 26, 2008.
Castro Property then filed for bankruptcy on Oct. 1, 2008.
Mr. Castro's personal assets -- including nine homes in Palm Beach
County -- weren't included in the bankruptcy, the report states.
According to the report, Castro Property listed $3.3 million in
debts, including the condo association liens, property taxes and
construction liens.
The six units were Castro Property's only assets, valued at $1.7
million, The Business Journal states.
Palm Beach Gardens, Florida-based Castro Property Mgmt., LLC,
filed for Chapter 11 protection on Oct. 1, 2008 (Bankr. S. D. Fla.
Case No. 08-24556). Craig I. Kelley, Esq., at Kelley & Fulton,
P.A., represents the company in its restructuring effort.
CHRYSLER LLC: Cerberus Capital Ends Talks With Nissan
-----------------------------------------------------
Chrysler LLC's parent, Cerberus Capital Management LP, has ended
talks with Nissan Motor Co., Jeff Bennett and John Stoll at The
Wall Street Journal reports, citing a person familiar with the
discussions.
According to WSJ, the sources said that Cerberus Capital wants to
focus on merger discussions with General Motors Corp.
WSJ relates that Cerberus Capital has been negotiating with Nissan
since the start of the year about having Chrysler join the Nissan-
Renault SA alliance. The three companies, says WSJ, had agreed
that Chrysler will produce pickup trucks for Nissan, while Nissan
will make a compact car for Chrysler.
Carlos Ghosn, Nissan and Renault's CEO, has dismissed reports of
talks with Chrysler as speculation, WSJ states.
Treasury Won't Negotiate Financial Aid for Merger
A government official said on Thursday that the U.S. Treasury
Department won't negotiate with GM and the owners of Chrysler on a
request to provide direct government financial support to their
merger, David Lawder at Reuters reports.
Industry sources said that GM had asked for $10 billion in a
government rescue package to support its acquisition of Chrysler
from Cerberus Capital Management, Reuters states. According to the
report, the request was viewed as above the $25 billion in funds
to allow the automakers to produce fuel-efficient vehicles.
Citing the official, Reuters relates that the government is
working to accelerate the distribution to automakers of $25
billion in factory retooling funds authorized by Congress in
September.
According to Reuters, the Treasury confirmed that automakers'
financial companies like GMAC LLC and Chrysler Financial would
qualify to sell distressed assets to the Treasury when it launches
reverse auctions under its $700 billion market bailout program.
Reuters relates that the finance arms must be registered as
federally regulated bank holding companies to qualify for a
capital injection under the $250 billion equity purchase portion
of the bailout program. Previous reports say that GMAC said that
it was seeking the bank holding company designation.
Steve Girsky to Advise Union on Merger Talks
According to WSJ, the United Auto Workers union is preparing to
weigh in on a potential GM-Chrysler merger, which would likely
result in thousands of layoffs at Chrysler. Citing people
familiar with the matter, WSJ relates that the union retained
Steve Girsky as adviser on the talks. WSJ states that he will
assist UAW President Ron Gettelfinger in evaluating the talks
between GM and Chrysler. The report says that Mr. Gettelfinger
has spoken out against the merger.
Mr. Girsky is president of Centerbridge Industrial Partners in New
York. Mr. Girsky is a board member of Dana Corp. Mr. Girsky was
a former adviser to GM Chief Executive Rick Wagoner and helped the
CEO in forming a restructuring plan for GM.
A person familiar with the matter said that UAW has begun meetings
with the auto makers hoping to "get a grasp of the situation," WSJ
reports.
About General Motors
Headquartered in Detroit, Michigan, General Motors Corp. (NYSE:
GM) -- http://www.gm.com/-- was founded in 1908. GM employs
about 266,000 people around the world and manufactures cars and
trucks in 35 countries. In 2007, nearly 9.37 million GM cars and
trucks were sold globally under the following brands: Buick,
Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel,
Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar
subsidiary is the industry leader in vehicle safety, security and
information services.
GM Europe is based in Zurich, Switzerland, while General Motors
Latin America, Africa and Middle East is headquartered in
Miramar, Florida.
At June 30, 2008, the company's balance sheet showed total assets
of US$136.0 billion, total liabilities of US$191.6 billion, and
total stockholders' deficit of US$56.9 billion. For the quarter
ended June 30, 2008, the company reported a net loss of US$15.4
billion over net sales and revenue of US$38.1 billion, compared to
a net income of US$891.0 million over net sales and revenue of
US$46.6 billion for the same period last year.
About Chrysler LLC
Headquartered in Auburn Hills, Michigan, Chrysler LLC --
http://www.chrysler.com/-- a unit of Cerberus Capital
Management LP, produces Chrysler, Jeep(R), Dodge and Mopar(R)
brand vehicles and products. The company has dealers worldwide,
including Canada, Mexico, U.S., Germany, France, U.K., Argentina,
Brazil, Venezuela, China, Japan and Australia.
* * *
As reported in the Troubled Company Reporter on Aug. 11, 2008,
Standard & Poor's Ratings Services lowered its ratings on Chrysler
LLC, including the corporate credit rating, to 'CCC+' from 'B-'.
On July 31, 2008, TCR said that Fitch Ratings downgraded the
Issuer Default Rating of Chrysler LLC to 'CCC' from 'B-'. The
Rating Outlook is Negative. The downgrade reflects Chrysler's
restricted access to economic retail financing for its vehicles,
which is expected to result in a further step-down in retail
volumes. Lack of competitive financing is also expected to result
in more costly subvention payments and other forms of sales
incentives. Fitch is also concerned with the state of the
securitization market and the ability of the automakers to access
this market on an economic basis over the near term, given the
steep drop in residual values, higher default rates, higher loss
severity being experienced and jittery capital market.
CLARIENT INC: September 30 Balance Sheet Upside-Down by $2.7MM
--------------------------------------------------------------
Clarient, Inc.'s balance sheet at Sept. 30, 2008, showed total
assets of $32.0 million and total liabilities of $35.0 million,
resulting in shareholders' deficit of $2.7 million in thousands.
Clarient reported financial results for the three and nine months
ended Sept. 30, 2008.
Net loss for three months ended Sept. 30, 2008, was $2.2 million
compared to net loss of $2.8 million for the same period in the
previous year. Operating income for the third quarter of 2008 was
$0.2 million compared with an operating loss of $2.5 million for
the same period of 2007.
Revenue for the third quarter of 2008 increased 59% to
$19.0 million compared with $11.9 million for the third quarter of
2007, and increased 12% compared with $16.9 million for the second
quarter of 2008. This marks Clarient's 17th consecutive quarter
of sequential revenue growth. The increase over the third quarter
of 2007 was driven by higher testing volume, favorable service mix
and higher Medicare reimbursement rates. These factors also drove
a 69% increase in revenue to $51.8 million for the first nine
months of 2008 compared with the same period in 2007.
For nine-month period ended Sept. 30, 2008, the company incurred
net loss of $7.4 million compared to net loss of $4.8 million in
the previous year.
As of Sept. 30, 2008, the company's cash was $1.9 million compared
with $1.5 million as of Dec. 31, 2007. In addition, the company
ended the quarter with a total of $10.6 million available under
existing lines of credit.
About Clarient Inc.
Based in Aliso Viejo, California, Clarient Inc. (Nasdaq: CLRT) --
http://www.clarientinc.com/-- is an advanced oncology diagnostics
services company. The company's principal customers include
pathologists, oncologists, hospitals and biopharmaceutical
companies.
Going Concern Doubt
As reported in the Troubled Company Reporter on April 10, 2008,
KPMG LLP, in Costa Mesa, California, expressed substantial doubt
about Clarient 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, negative cash flows from
operations, and working capital and net capital deficiencies.
In addition, KPMG said it is not probable that the company can
remain in compliance with the restrictive monthly financial
covenant in its bank credit facility.
In order to comply with the covenants in the current debt
agreement, the company must achieve operating results at levels
not historically achieved by the company.
COLOWYO COAL: Moody's Cuts Rating to Ba3; Outlook Negative
----------------------------------------------------------
Moody's Investors Service downgraded Colowyo Coal Funding Corp.
(CC Funding) to Ba3 from Ba2. The rating outlook continues to
remain negative.
The rating action reflects CC Funding's drop in cash flow for debt
service in the first half of 2008 resulting in a large draw on the
debt service reserve letter of credit. A recent outage at the
Craig Station power station reduced coal sold by Colowyo Coal to
Craig Station resulting in lower cash flow at CC Funding. Moody's
notes that the May 2008 drawdown exceeds the prior cumulative
draws on the debt service reserve over the last four years. As of
June 2008, approximately $18.7 million was available in the debt
service reserve letter of credit.
The rating action also considers Moody's expectation that any
draws on the debt service reserve is unlikely to be replenished
since excess cash is used to reimburse Kennecott for prior
reductions in the transfer price. The availability under the debt
service reserve remains a key ratings driver since coal quality
issues and broad force majeure provisions under the Craig Station
are expected to continue to cause cash flow volatility at CC
Funding.
The negative rating outlook reflects Moody's concerns that CC
Funding's debt service coverage ratios will continue to dip below
1 times and that draws on the debt service reserve will be
necessary to fund cash flow shortfalls. Additional significant
draws on the debt service reserve are likely to result in further
negative rating pressure.
Colowyo Coal Funding Corp is a special purpose funding corporation
formed to monetize the expected net cash flow derived from coal
supply contracts between Craig power station (Craig Station) and
Colowyo Coal Company LP (Colowyo) as coal supplier. Colowyo Coal
Funding Corp is a wholly owned subsidiary of Colowyo. Colowyo is
20% indirectly owned by Rio Tinto Plc (Rio Tinto) and 80% owned by
W.R. Grace.
COMMERCIAL VEHICLE: Dismal 3Q Cues Moody's to Consider Rtngs Cut
----------------------------------------------------------------
Moody's Investors Service placed Commercial Vehicle Group Inc.'s
B1 corporate family rating, B1 probability of default rating, and
B2 (LGD 4; 65%) senior unsecured notes rating under review for
possible downgrade. Simultaneously, Moody's downgraded CVGI's
speculative grade liquidity rating (SGL) to SGL-4 from SGL-3.
The review for possible downgrade is prompted by third quarter
results that were meaningfully below Moody's expectations, a
reasonable likelihood that CVGI may violate its covenants in the
fourth quarter, and the potential for the company to have
breakeven to negative free cash flow over the next twelve to
eighteen months, in Moody's opinion. Moody's expects that the
uncertain economic conditions will likely translate into a slower
than expected recovery in Class 8 vehicle builds. Prior
assumptions that production would rise materially ahead of new
emissions regulations in 2010 have been revised downward due to
the economic headwinds.
The review will focus on the company's plans to operate in less
certain global economic conditions, the ongoing integration of the
recent acquisitions, and CVGI's ability to maintain sufficient
liquidity to fund operations during an extended cyclical trough.
Negative free cash flow could result in incremental borrowings
under the company's revolving credit facility, full availability
under which is less than assured due to expected covenant
compliance concerns. CVGI has twice amended its credit facility to
revise its covenants in the past year.
The downgrade of the speculative grade liquidity rating to SGL-4
from SGL-3 reflects weak liquidity, in part, due to the
aforementioned near-term covenant compliance concerns. Moody's
also expects that operating cash flow may be insufficient to cover
working capital and planned capital expenditures on a quarterly
basis over the next twelve months. Moody's could consider
revisiting the SGL-4 rating if cushion under covenants is better
than expected or if the company secures alternative committed
sources of liquidity.
Moody's previously downgraded the ratings of CVGI in March of
2008.
The ratings actions were:
-- B1 Corporate Family Rating placed under review for possible
downgrade
-- B1 Probability of Default Rating placed under review for
possible downgrade
-- B2 (LGD 4; 65%) senior unsecured notes rating placed under
review for possible downgrade
-- Speculative Grade Liquidity Rating (SGL) downgraded to
SGL-4 from SGL-3
Commercial Vehicle Group, Inc. is a provider of customized
products for the commercial vehicle market. The company had
revenues of approximately $750 million for the twelve month period
ended June 30, 2008.
CONCORD CAMERA: Board OKs Plan of Liquidation, Terminates Workers
-----------------------------------------------------------------
Concord Camera Corp. disclosed that its board of directors has
unanimously approved a plan of dissolution and liquidation of the
company and that it will file a proxy statement seeking
shareholder approval of the plan.
The Plan of Liquidation contemplates an orderly wind down of the
company's business and operations, the monetization of the
company's non-cash assets, the satisfaction or settlement of its
remaining liabilities and obligations and one or more
distributions to its shareholders.
In connection with the board's approval of the Plan of
Liquidation, the company also said that it has ceased
manufacturing and terminated certain of its employees and, if the
company's shareholders approve the Plan of Liquidation, will
terminate its remaining employees throughout the wind down period.
If the company's shareholders approve the Plan of Liquidation, the
company intends to file a certificate of dissolution, sell and
monetize its non-cash assets, satisfy or settle its remaining
liabilities and obligations, including contingent liabilities and
claims, and make one or more distributions to its shareholders of
cash available for distribution. In connection with the
shareholder approval of the Plan of Liquidation, the company
expects to delist its shares from NASDAQ.
The execution of the Plan of Liquidation will be completed soon as
practicable. However, the company is unable to predict the time
required to complete the Plan of Liquidation or the precise timing
or amount of any distributions pursuant to the Plan of
Liquidation. The amount and timing of any distributions will be
determined by the board and will depend upon the company's ability
to monetize its non-cash assets, including, but not limited to,
auction rate securities that the company has been unable to sell
due to the recent disruptions in the credit markets and for which
the company has reduced the carrying value by approximately $5.1
million to approximately $17.1 million as of Sept. 27, 2008, and
the company's property in the PRC where the real estate market has
experienced significant declines due to the worldwide financial
crisis, and to estimate, settle or otherwise resolve its remaining
liabilities and obligations, some of which are significant,
including litigations and other contingent liabilities and claims
that have not been resolved and quantified.
In August 2006, the board established a Special Committee to
investigate, evaluate and analyze strategic alternatives for the
company. In determining to approve the company's Plan of
Liquidation, the board reviewed and considered an analysis of the
plan of liquidation, well as the findings of the Special Committee
regarding other alternatives available to the company. Despite
devoting substantial time, effort and resources, neither the
Special Committee nor the company was able to identify a buyer or
strategic partner willing to firmly commit to acquire the company,
in whole or in part, on financial and other terms which the board
viewed as reasonably likely to provide greater realizable value to
its shareholders than the complete dissolution and liquidation of
the company in accordance with the Plan of Liquidation.
Shareholders may obtain a free copy of the proxy statement and
other materials (when they become available), and any other
documents filed by the company with the Securities and Exchange
Commission by directing a request to: Legal Department, Concord
Camera Corp., 4000 Hollywood Blvd, 6th Floor North Tower,
Hollywood, Florida 33021.
In addition, the company expects to file its Annual Report on
Form 10-K for the year ended June 28, 2008, on or about Nov. 7,
2008.
About Concord Camera Corp.
Headquartered in Hollywood, Florida, Concord Camera Corp.
(NASDAQ:LENS) -- http://www.concord-camera.com/-- through its
subsidiaries, provides easy-to-use 35mm single-use and traditional
film cameras. Concord markets and sells its cameras on a private-
label basis and under the POLAROID and POLAROID FUNSHOOTER brands
through in-house sales and marketing personnel and independent
sales representatives. The POLAROID trademark is owned by
Polaroid Corporation and is used by Concord under license from
Polaroid.
DELTA AIR: Amends Compensation Plan as Northwest Merger Completes
-----------------------------------------------------------------
Delta Air Lines, Inc., filed with the Securities and Exchange
Commission on Oct. 29, 2008, the first amendment to its 2007
Performance Compensation Plan, which is effective upon the
completion of the merger with Northwest Airlines Corporation.
In particular, the SEC filing relates to the registration of
130,000,000 shares of Delta's common stock, par value $0.0001 per
share that may be issued in connection with awards granted under
Delta's Compensation Plan.
According to Edward H. Bastian, Delta's president and chief
financial officer, Section 5(a) of the Delta 2007 Performance
Compensation Plan, which reflects the available Delta shares,
will provide that subject to certain adjustments, the maximum
number of Shares available for distribution under the Plan will
not exceed:
(i) 30,000,000 Shares, plus
(ii) the number of Shares equal to 15% of the outstanding
equity capitalization of Delta, determined on a
"fully-diluted basis" at the Effective Time of the Merger,
of which at least 50% will be reserved for awards to non-
officer employees of Delta and Northwest.
"Fully-diluted basis" takes into account the maximum number of
Shares -- issued or issuable in respect of obligations
outstanding at the Effective Time and subject to Awards -- that
the Company has announced it intends to make or has agreed it
will make in connection with the consummation of the Merger,
including awards to non-pilot and management employees of Delta
and NWA, which are issuable pursuant Delta and NWA's Plans of
Reorganization.
The Shares will be calculated based on the "treasury stock method"
of calculating diluted earnings per share under Statement of
Financial Accounting Standards No. 128, which took effect on
April 14, 2008.
Kenneth F. Khoury, executive vice president and general counsel of
Delta, affirms that upon the issuance of the Shares as provided in
the Compensation Plan, the Shares will be duly authorized, validly
issued and fully paid, and non-assessable.
A full-text copy of the Amended 2007 Compensation Plan on Form S-
8 is available for free at http://ResearchArchives.com/t/s?346d
About Northwest Airlines
Northwest Airlines Corp. (NYSE: NWA) -- http://www.nwa.com/-- is
the world's fourth largest airline with hubs at Detroit,
Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and about
1,400 daily departures. Northwest is a member of SkyTeam, an
airline alliance that offers customers one of the world's most
extensive global networks. Northwest and its travel partners
serve more than 1000 cities in excess of 160 countries on six
continents. Northwest and its travel partners serve more than
1000 cities in excess of 160 countries on six continents,
including Italy, Spain, Japan, China, Venezuela and Argentina.
The company and 12 affiliates filed for chapter 11 protection on
Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). Bruce
R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at Cadwalader,
Wickersham & Taft LLP in New York, and Mark C. Ellenberg, Esq.,
at Cadwalader, Wickersham & Taft LLP in Washington, represent the
Debtors in their restructuring efforts. The Official Committee
of Unsecured Creditors has retained Scott L. Hazan, Esq., at
Otterbourg, Steindler, Houston & Rosen, P.C. as its bankruptcy
counsel in the Debtors' chapter 11 cases. When the Debtors filed
for bankruptcy, they listed $14.4 billion in total assets and
$17.9 billion in total debts. On Jan. 12, 2007, the Debtors filed
with the Court their chapter 11 plan. On Feb. 15, 2007, the
Debtors filed an amended plan and disclosure statement. The Court
approved the adequacy of the Debtors' amended disclosure statement
on March 26, 2007. On May 21, 2007, the Court confirmed the
Debtors' amended plan. That amended plan took effect May 31,
2007.
(Northwest Airlines Bankruptcy News; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).
About Delta Air
Based in Atlanta, Georgia, Delta Air Lines Inc. (NYSE: DAL) --
http://www.delta.com/-- is the world's second-largest airline
in terms of passengers carried and the leading U.S. carrier
across the Atlantic, offering daily flights to 328 destinations
in 56 countries on Delta, Song, Delta Shuttle, the Delta
Connection carriers and its worldwide partners. Delta flies to
Argentina, Australia and the United Kingdom, among others.
The company and 18 affiliates filed for chapter 11 protection on
Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall
S. Huebner, Esq., at Davis Polk & Wardwell, represents the Debtors
in their restructuring efforts. Timothy R. Coleman at The
Blackstone Group L.P. provides the Debtors with financial advice.
Daniel H. Golden, Esq., and Lisa G. Beckerman, Esq., at Akin Gump
Strauss Hauer & Feld LLP, provide the Official Committee of
Unsecured Creditors with legal advice. John McKenna, Jr., at
Houlihan Lokey Howard & Zukin Capital and James S. Feltman at
Mesirow Financial Consulting, LLC, serve as the Committee's
financial advisors.
The Debtors filed a chapter 11 plan of reorganization and
disclosure statement explaining that plan on Dec. 19, 2007.
On Jan. 19, 2007, they filed revisions to the plan and disclosure
statement, and submitted further revisions to the plan on Feb. 2,
2007. On Feb. 7, 2007, the Court approved the Debtors' disclosure
statement. In April 25, 2007, the Court confirmed the Debtors'
plan. That plan became effective on April 30, 2007. The Court
entered a final decree closing 17 cases on Sept. 26, 2007.
* * *
As reported in the Troubled Company Reporter on July 29, 2008,
Standard & Poor's Ratings Services lowered its ratings on
Northwest Airlines Corp. and subsidiary Northwest Airlines Inc.
(both rated B/Negative/--), including lowering the long-term
corporate credit ratings on both entities to 'B' from 'B+', and
removed the ratings from CreditWatch, where they had been placed
with negative implications April 15, 2008. The outlook is
negative.
The downgrade reflects expected losses and reduced or negative
operating cash flow caused by high fuel prices. S&P also lowered
our ratings on enhanced equipment trust certificates, in some
cases by more than one notch.
ELECTRICAL COMPONENTS: Moody's Affirms Caa2 Ratings; Stable
-----------------------------------------------------------
Moody's Investors Service confirmed the Caa2 corporate family and
probability of default ratings of Electrical Components
International. Moody's also upgraded the rating of its first lien
senior secured credit facility to Caa1 from Caa2 while maintaining
the Caa3 rating on the second lien senior secured term loan, which
reflects improvements in the company's capital structure. The
outlook is stable.
The confirmation concludes a review for possible downgrade that
was extended on August 4, 2008, as a result of the delay in
reaching an agreement to amend the financial covenants contained
in ECI's credit agreements. Subsequently, ECI amended its credit
agreement and is no longer in default. As a result, ECI's
auditors, Ernst & Young LLP, issued an unqualified opinion for the
company's 2007 year-end financial, bringing all financial
reporting requirements current.
The Caa2 corporate family rating reflects the negative trend in
credit metrics resulting from the continued downturn in the U.S.
housing market, the significant slowdown in the Western European
residential construction market and the resulting decline in the
company's key end market -- home appliances. Moody's believes that
the U.S. and Western European economies will continue to slow
through the balance of 2008 and through 2009 negatively impacting
their respective housing markets and stressing ECI's operating
margins. Furthermore, the current turmoil in the credit markets
has added economic uncertainty potentially limiting available
credit for home appliance purchases. To meet these challenges ECI
is undertaking a restructuring program to improve its operating
efficiencies including consolidation of production facilities.
The stable outlook reflects that ECI is no longer in covenant
violation under its credit agreement restoring access to its
revolving credit facility. ECI's adequate liquidity profile and
benefits from its restructuring program should assist the company
during the current difficult operating market.
The Caa1 rating of the senior secured bank credit facility and the
Caa3 rating of the second lien term loan are consistent with the
application of Moody's Loss Given Default Methodology and reflect
the cure of the technical default in the credit facilities, and a
$15 million reduction in the first lien term loan from $244
million to $229 million that was funded by capital contribution
from the equity sponsor.
The following ratings/assessments were affected by this action:
Corporate family rating confirmed at Caa2;
Probability of default confirmed at Caa2;
$264 million senior secured bank credit facility upgraded to Caa1
(LGD3, 38%) from Caa2 (LGD3, 36%); and,
$60 million second lien term loan due 2014 confirmed at Caa3, buts
its loss given default assessment is changed to (LGD5, 80%) from
(LGD5, 79%).
The last rating action was on August 4, 2008 at which time Moody's
downgraded ECI's corporate family rating to Caa2 from Caa1.
Electrical Components International, Inc., headquartered in St.
Louis, Missouri, designs, manufactures and markets wire harnesses
and provides assembly services primarily for major white goods
appliance manufacturers in North America and Europe.
FITNESS HOLDINGS: Court Extends Schedules Deadline to December 4
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California
extended to Dec. 4, 2008, the time for Fitness Holdings
International Inc. to file its schedules of assets and
liabilities, statement of affairs and related lists.
The Debtor told the Court that the size and complexity of its case
are sufficient reasons to warrant the extension. The Debtor said
it currently operates 111 retail locations in 14 states and that
it has in excess of 600 creditors and other parties in interest,
and approximately 270 employees.
The Debtor adds that its accounting personnel are working hard to
complete the information needed to prepare the schedules,
statements and lists, but they will need additional time to allow
for their proper preparation.
About Fitness Holdings
Long Beach, California-based Fitness Holdings International, Inc.,
sells treadmills, cross-trainers, and exercise bikes for home use.
The company does business as Busy Body Home Fitness, OMNI Fitness
Equipment and LA Gym Equipment.
The company filed for Chapter 11 protection on Oct. 20, 2008
(Bankr. C. D. Calif. Case No. 08-27527). David S. Kupetz, Esq.,
at SulmeyerKupetz, A Professional Corporation, represents the
company in its restructuring efforts. The company listed assets
of $10 million to $50 million and debts of $10 million to
$50 million.
FITNESS HOLDINGS: Section 341(a) Meeting Scheduled for Nov. 26
--------------------------------------------------------------
The U.S. Trustee for the Central District of California will
convene a meeting of Fitness Holdings International, Inc.'s
creditors on Nov. 26, 2008, at 9:00 a.m., at Room 2610, 725 South
Figueroa Street, Los Angeles, California 90017.
This is the first meeting of creditors required under Section
341(a) of the U.S. Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
Long Beach, California-based Fitness Holdings International, Inc.,
sells treadmills, cross-trainers, and exercise bikes for home use.
The company does business as Busy Body Home Fitness, OMNI Fitness
Equipment and LA Gym Equipment.
The company filed for Chapter 11 protection on Oct. 20, 2008
(Bankr. C. D. Calif. Case No. 08-27527). David S. Kupetz, Esq.,
at SulmeyerKupetz, A Professional Corporation, represents the
company in its restructuring effort. The company listed assets of
$10 million to $50 million and debts of $10 million to $50
million.
FRANKLIN CREDIT: NASDAQ to Delist Securities on November 3
----------------------------------------------------------
Franklin Credit Management Corporation received notice from The
NASDAQ Stock Market that the company's common stock will cease to
be listed on NASDAQ effective at the opening of business on
Nov. 3, 2008. This notice reflects a decision by the NASDAQ
Hearings Panel after a hearing held on Oct. 23, 2008, in
connection with the company's request for continued listing
notwithstanding its failure to satisfy NASDAQ's minimum $2,500,000
shareholders' equity requirement.
The company expects its common stock to be quoted on the "Pink
Sheets" after its delisting from The NASDAQ Capital Market and
will seek to have its common stock quoted on the OTC Bulletin
Board.
Based in Jersey City, New Jersey, Franklin Credit Management
Corporation (NASDAQ:FCMC) -- http://www.franklincredit.com/-- is
a specialty consumer finance company engaged in the servicing and
resolution of its performing, reperforming and nonperforming
residential mortgage loans. Franklin's portfolio consists of both
first- and second-lien loans secured by 1-4 family residential
real estate that generally fall outside the underwriting standards
of Fannie Mae and Freddie Mac and involve elevated credit risk as
a result of the nature or absence of income documentation, limited
credit histories, higher levels of consumer debt or past credit
difficulties. Franklin originated non-prime loans through its
wholly-owned subsidiary, Tribeca Lending Corp., and has generally
held for investment the loans acquired and a significant portion
of the loans originated. The company's executive, administrative
and operations offices are located in Jersey City, New Jersey.
FREEDOM BANK: Gives Up to FDIC; Fifth Third Buys All Deposits
-------------------------------------------------------------
Freedom Bank, Bradenton, Florida, was closed on Oct. 31, 2008, by
the Commissioner of the Florida Office of Financial Regulation,
and the Federal Deposit Insurance Corporation was named receiver.
To protect the depositors, the FDIC entered into a purchase and
assumption agreement with Fifth Third Bank, Grand Rapids,
Michigan, to assume all of the deposits of Freedom Bank.
The four branches of Freedom Bank will reopen on Nov. 3 as
branches of Fifth Third Bank. Depositors of the failed bank will
automatically become depositors of Fifth Third. Deposits will
continue to be insured by the FDIC, so there is no need for
customers to change their banking relationship to retain their
deposit insurance coverage. Customers of both banks should
continue to use their existing branches until Fifth Third can
fully integrate the deposit records of Freedom Bank.
Over the weekend, depositors of Freedom Bank can access their
money by writing checks or using ATM or debit cards. Checks drawn
on the bank will continue to be processed. Loan customers should
continue to make their payments as usual.
As of Oct. 17, 2008, Freedom Bank had total assets of
$287 million and total deposits of $254 million. Fifth Third
agreed to assume all the deposits for a premium of 1.16%. In
addition to assuming the failed bank's deposits, Fifth Third will
purchase approximately $36 million of assets. The FDIC will
retain the remaining assets for later disposition.
The FDIC estimates that the cost to the Deposit Insurance Fund
will be between $80 million and $104 million. Fifth Third's
acquisition of all deposits was the "least costly" resolution for
the FDIC's Deposit Insurance Fund compared to alternatives. The
last failure in Florida was First Priority Bank, Bradenton, which
was closed on Aug. 1, 2008. Freedom Bank is the seventeenth FDIC-
insured institution to be closed this year.
About Federal Deposit
Congress created the Federal Deposit Insurance Corporation in 1933
to restore public confidence in the nation's banking system. The
FDIC insures deposits at the nation's 8,451 banks and savings
associations and it promotes the safety and soundness of these
institutions by identifying, monitoring and addressing risks to
which they are exposed. The FDIC receives no federal tax dollars
-? insured financial institutions fund its operations.
About Freedom Bank
Freedom Bank provides financial services and products in
Bradenton, Florida.
GAINEY CORP: May Employ Dickinson Wright as Bankruptcy Counsel
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Michigan
granted Gainey Corp. and its debtor-affiliates permission to
employ Dickinson Wright PLLC as their counsel.
As the Debtors' counsel, Dickinson Wright is expected to:
a) advise the Debtors with respect to their rights, powers and
duties as debtors and debtors-in-possession in the continued
management and operation of their businesses and properties;
b) attend meetings and negotiate with representatives of
creditors and other parties-in-interest;
c) advise and consult the Debtors regarding the conduct of these
cases, including all of the legal and administrative
requirements of operating in Chapter 11;
d) advise the Debtors on matters relating to the evaluation of
the assumption, rejection or assignment of unexpired leases
and executory contracts;
e) taking all necessary action to protect and preserve the
Debtors' estates, including the prosecution of actions on
their behalf, the defense of any actions commenced against
those estates, negotiations concerning all litigation in
which the Debtors may be involved and objections to claims
filed against the estates;
f) assist in prosecuting a plan of reorganization and disclosure
statement and all related agreements or documents and taking
any necessary action on behalf of the Debtors to obtain
confirmation of such a plan;
g) appear before the Court, any appellate courts, and the Office
of the United States Trustee, and protecting the interests of
the Debtors' estates before such courts and the Office of the
United States Trustee;
h) represent the Debtors in connection with related "non-
bankruptcy" matters ongoing during the pendency of the case,
including, without limitation, corporate, tax, employment,
labor and certain litigation matters; and
i) perform all other necessary legal services and provide all
other necessary legal advice to the Debtors in connection
with these Chapter 11 cases to bring the Debtors' Chapter 11
cases to a conclusion.
Dickinson Wright's hourly rates, as of the petition date, range
from $275-$525 for members, $180-$265 for associates and $95-$175
for legal assistants.
Daniel F. Gosch, a member of Dickinson Wright, assured the Court
that the firm neither holds nor represents any interest adverse to
the Debtors or their estates, and that it is a "disinterested
person" as that term is defined under Sec. 101(14) of the
Bankruptcy Code.
Headquartered in Grand Rapids, Michigan, Gainey Corp. --
http://www.gaineycorp.com/-- provides trucking and freight-
services in the U.S. and parts of Canada. It has 5,000 trucks and
trailers, and employs more than 2,300 workers including 1,900
truck drivers.
The company and its subsidiaries filed for Chapter 11 bankruptcy
protection (Bankr. W.D. Mich. Lead Case No. 08-09092) on Oct. 14,
2008. The Lead Debtor listed between $50 million and $100 million
in total assets and between $100 million and $500 million in total
debts.
GAINEY CORP: Seeks to Extend Filing of Schedules to November 13
---------------------------------------------------------------
Gainey Corp. and its affiliates ask the U.S. Bankruptcy Court for
the Western District of Michigan to extend the deadline for the
filing of the Debtors' bakruptcy schedules and statement of
financial affairs.
Under Sections 105(a) and 521 of title 11 of the United States
Bankruptcy Code and, Rule 1007(c) of Federal Rule of Bankruptcy
Procedure, the Debtors must file their schedules and statements on
or within 15 days of the bankruptcy petition date. Pursuant to
Bankruptcy Rules 1007(c) and 9006(b), the Court may extend the
time required for filing the schedules & statements for cause.
The Debtors each filed for Chapter 11 protection on Oct. 14, 2008,
and sought procedural consolidation and joint administration of
their bankruptcy cases. The Debtors are operating their
businesses and managing their property as debtors in possession
pursuant to Sections 1107(a) and 1108 of the Bankruptcy Code.
The Debtors tell the Court that they will need 30 days from the
petition date to complete their schedules and statements. This
would constitute a 15-day extension of the deadline beyond the 15
days already provided under Bankruptcy Rule 1007(c) to file the
schedules & statements.
The Debtors explain that due to the complexity of their businesses
and the critical restructuring issues that have consumed the
attention of the Debtors' key personnel and professionals, the
Debtors anticipate that they won't be able to complete their
schedules and statements within the time required under Section
521(a)(1) of the Bankruptcy Code and Bankruptcy Rule 1007(c).
Given the nature of the Debtors' business, which involves the
transportation of goods throughout the U.S., and the multiple
locations from which the Debtors conduct business, the Debtors
have numerous creditors and
related claims to evaluate, including numerous claimants relating
to personal injury and property damage claims, arising from
locations across the country. The Debtors say that due to the
complexity of their business operations, they haven't had
sufficient opportunity to gather the necessary information to
prepare and file their schedules and statements.
The Debtors provides nationwide trucking, freight-hauling, and
related freight brokerage and logistics services to a variety of
industries, arranging for, facilitating, and providing for the
shipment of goods and products throughout the U.S. and Canada.
The Debtors, in the aggregate, maintain and use more than 5,000
trucks and trailers, and have about 2,300 workers throughout the
U.S., including some 1,900 truck drivers.
The Debtors operate their business from headquarters located in
Grand Rapids, Michigan. The Debtors maintain terminals and other
offices used in connection with the distribution of hauled goods
in various locations across the U.S., maintaining ongoing
communication with trucks and drivers through the extensive use of
cutting edge communications and logistics technology. The
operations of Super Service, Inc., Freight
Brokers of America, Inc., and Lester Coggins Trucking, Inc.,
maintain their primary headquarters in Kentucky, Kansas, and
Florida, respectively, but also utilize management services,
including cash management, provided by the Debtors located in
Michigan.
Before filing for bankruptcy, the Debtors entered into a secured
loan facility agreement with 30 lenders in April 2006, under which
Wachovia Bank, NA, acts as their agent. Gainey is the Borrower
and the other Debtors are guarantors. As of the bankruptcy
petition date, the total amount outstanding -- including accrued
interest -- under the Loan Agreement was
$230 million.
The Debtors, before the bankruptcy filing, were engaged in
intensive, arms' length negotiations with the agent concerning the
terms of a consensual global restructuring as between
and among the Debtors and the Prepetition Lending Group, but were
unable to reach resolution on the final terms and conditions of
such a restructuring. In August 2008, the agent
"accelerated" the obligations. Subsequently, various entities
presented proposals to the agent for the acquisition of the
indebtedness, but the relevant parties were unable to reach
agreement as to the terms of an associated transaction. As a
consequence, the agent requested that the Debtors consent to a
voluntary surrender of the Debtors' assets to the agent for
subsequent liquidation. When the agent and the Debtors failed to
reach agreement on the terms and conditions of the proposed
surrender and liquidation, the agent notified the Debtors of its
intention to exercise further rights and remedies under the Loan
Documents. To preserve the value of the Debtors' assets for the
benefit of all creditors and parties in interest, the Debtors
commenced these proceedings.
The Debtors tell the Court that before their bankruptcy filing,
majority of the efforts of the Debtors' employees was focused upon
the operation of the Debtors' business, analysis of issues, and
the gathering of information required by an agent in connection
with possible restructuring scenarios. The nature of that
information gathering process has been different than the process
contemplated in connection with the preparation of the schedules
and statements. The Debtors say that they have already started
gathering necessary information to prepare and finalize the
schedules and statements, but they believe that the 15-day
automatic extension to file the schedules and statements provided
by Bankruptcy Rule 1007(c) won't be sufficient to complete the
schedules and statements.
Headquartered in Grand Rapids, Michigan, Gainey Corp. --
http://www.gaineycorp.com/-- provides trucking and freight-
services in the U.S. and parts of Canada. It has 5,000 trucks and
trailers, and employs more than 2,300 workers including 1,900
truck drivers.
The company and its subsidiaries filed for Chapter 11 bankruptcy
protection (Bankr. W.D. Mich. Lead Case No. 08-09092) on Oct. 14,
2008. The Lead Debtor listed between $50 million and $100 million
in total assets and between $100 million and $500 million in total
debts.
GENERAL GROWTH: Moody's Cuts Ratings B3; Remain Under Review
------------------------------------------------------------
Moody's Investors Service has downgraded the ratings on General
Growth Properties, Inc., certain of its subsidiaries and The Rouse
Company LP (to B3 from Ba3 senior secured bank debt; to B3 from
Ba3 senior unsecured debt). The ratings remain on review for
further possible downgrade. The rating action reflects General
Growth's continued strained financial flexibility, and substantial
uncertainty of the REIT's liquidity position and credit profile
given significant near term refinancing and development funding
needs, coupled with expected earnings pressure due to a likely
protracted downturn in the economy. Recently announced management
changes are also worrisome as Moody's believes this adds
increasing uncertainty to the strategic vision for the REIT. The
earnings pressures have eroded General Growth's credit metrics and
the cushion for both the secured debt and interest coverage
covenants for the Rouse debt. Furthermore, given the current
capital constrained environment, Moody's believes that the
company's ability to pay off or refinance its upcoming mortgage
debt of $1.1 billion due at the end of next month is very
constrained.
The company has been exploring several alternatives to meet their
urgent capital needs, which includes working on extending the
maturity date of their mortgage loans due in November and also
marketing for sale their premier Las Vegas malls. Moody's notes
that the shedding of a portfolio which includes some of General
Growth's most profitable assets will likely compromise future
earnings power, portfolio quality, and credit metrics.
Moody's review will continue to focus on the REIT's ability to
manage through its substantial funding needs in the near term, as
well as its ultimate capital structure, asset composition, and
earnings strength and stability. The B3 rating reflects the
company's current credit metrics and its existing portfolio. A
further downgrade would likely reflect any refinancing missteps,
any weakening of current credit metrics and an acute reversal in
earnings strength or stability, or a breach in bond covenants. A
return to a stable outlook would be contingent upon the REIT's
ability to successfully refinance or extend on a long term basis
its near term debt maturities, maintain good operating performance
at its retail centers, preserve current credit metrics on a
consolidated basis, and comply with bond covenants.
Thes ratings were downgraded and placed under review down for
possible downgrade:
GGP Limited Partnership - Senior secured bank debt to B3 from Ba3,
and senior unsecured debt shelf to (P)B3 from (P)Ba3.
General Growth Properties, Inc. - Senior secured bank debt to B3
from Ba3, and preferred stock shelf to (P)Caa2 from (P)B2.
The Rouse Company LP - Senior unsecured debt to B3 from Ba3.
General Growth Properties, Inc. [NYSE: GGP] is headquartered in
Chicago, IL, and is one of the largest owners and operators of
regional malls in the United States. The REIT reported assets of
$29.5 billion, and equity of $1.9 billion, at June 30, 2008.
GENERAL MOTORS: Merger Talks Proceed; Cerberus Halts Nissan Talks
-----------------------------------------------------------------
Chrysler LLC's parent, Cerberus Capital Management LP, has ended
talks with Nissan Motor Co., Jeff Bennett and John Stoll at The
Wall Street Journal reports, citing a person familiar with the
discussions.
According to WSJ, the sources said that Cerberus Capital wants to
focus on merger discussions with General Motors Corp.
WSJ relates that Cerberus Capital has been negotiating with Nissan
since the start of the year about having Chrysler join the Nissan-
Renault SA alliance. The three companies, says WSJ, had agreed
that Chrysler will produce pickup trucks for Nissan, while Nissan
will make a compact car for Chrysler.
Carlos Ghosn, Nissan and Renault's CEO, has dismissed reports of
talks with Chrysler as speculation, WSJ states.
Treasury Won't Negotiate Financial Aid for Merger
A government official said on Thursday that the U.S. Treasury
Department won't negotiate with GM and the owners of Chrysler on a
request to provide direct government financial support to their
merger, David Lawder at Reuters reports.
Industry sources said that GM had asked for $10 billion in a
government rescue package to support its acquisition of Chrysler
from Cerberus Capital Management, Reuters states. According to the
report, the request was viewed as above the $25 billion in funds
to allow the automakers to produce fuel-efficient vehicles.
Citing the official, Reuters relates that the government is
working to accelerate the distribution to automakers of $25
billion in factory retooling funds authorized by Congress in
September.
According to Reuters, the Treasury confirmed that automakers'
financial companies like GMAC LLC and Chrysler Financial would
qualify to sell distressed assets to the Treasury when it launches
reverse auctions under its $700 billion market bailout program.
Reuters relates that the finance arms must be registered as
federally regulated bank holding companies to qualify for a
capital injection under the $250 billion equity purchase portion
of the bailout program. Previous reports say that GMAC said that
it was seeking the bank holding company designation.
Steve Girsky to Advise Union on Merger Talks
According to WSJ, the United Auto Workers union is preparing to
weigh in on a potential GM-Chrysler merger, which would likely
result in thousands of layoffs at Chrysler. Citing people
familiar with the matter, WSJ relates that the union retained
Steve Girsky as adviser on the talks. WSJ states that he will
assist UAW President Ron Gettelfinger in evaluating the talks
between GM and Chrysler. The report says that Mr. Gettelfinger
has spoken out against the merger.
Mr. Girsky is president of Centerbridge Industrial Partners in New
York. Mr. Girsky is a board member of Dana Corp. Mr. Girsky
was a former adviser to GM Chief Executive Rick Wagoner and helped
the CEO in forming a restructuring plan for GM.
A person familiar with the matter said that UAW has begun meetings
with the auto makers hoping to "get a grasp of the situation," WSJ
reports.
About Chrysler LLC
Headquartered in Auburn Hills, Michigan, Chrysler LLC --
http://www.chrysler.com/-- a unit of Cerberus Capital
Management LP, produces Chrysler, Jeep(R), Dodge and Mopar(R)
brand vehicles and products. The company has dealers worldwide,
including Canada, Mexico, U.S., Germany, France, U.K., Argentina,
Brazil, Venezuela, China, Japan and Australia.
* * *
As reported in the Troubled Company Reporter on Aug. 11, 2008,
Standard & Poor's Ratings Services lowered its ratings on Chrysler
LLC, including the corporate credit rating, to 'CCC+' from 'B-'.
On July 31, 2008, TCR said that Fitch Ratings downgraded the
Issuer Default Rating of Chrysler LLC to 'CCC' from 'B-'. The
Rating Outlook is Negative. The downgrade reflects Chrysler's
restricted access to economic retail financing for its vehicles,
which is expected to result in a further step-down in retail
volumes. Lack of competitive financing is also expected to result
in more costly subvention payments and other forms of sales
incentives. Fitch is also concerned with the state of the
securitization market and the ability of the automakers to access
this market on an economic basis over the near term, given the
steep drop in residual values, higher default rates, higher loss
severity being experienced and jittery capital market.
About General Motors
Headquartered in Detroit, Michigan, General Motors Corp. (NYSE:
GM) -- http://www.gm.com/-- was founded in 1908. GM employs
about 266,000 people around the world and manufactures cars and
trucks in 35 countries. In 2007, nearly 9.37 million GM cars and
trucks were sold globally under the following brands: Buick,
Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel,
Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar
subsidiary is the industry leader in vehicle safety, security and
information services.
GM Europe is based in Zurich, Switzerland, while General Motors
Latin America, Africa and Middle East is headquartered in
Miramar, Florida.
At June 30, 2008, the company's balance sheet showed total assets
of US$136.0 billion, total liabilities of US$191.6 billion, and
total stockholders' deficit of US$56.9 billion. For the quarter
ended June 30, 2008, the company reported a net loss of US$15.4
billion over net sales and revenue of US$38.1 billion, compared to
a net income of US$891.0 million over net sales and revenue of
US$46.6 billion for the same period last year.
GMAC LLC: Moody's Cuts Ratings to Caa1, Continues Rating Review
---------------------------------------------------------------
Moody's Investors Service downgraded the long-term ratings of GMAC
LLC (senior unsecured to Caa1 from B3) and continued the review
for possible further downgrade.
This action follows GMAC's announcement that it intends to
commence an offering to exchange much of its debt for a lower
principal amount of new debt. GMAC indicated that the offering is
in connection with its efforts to raise capital to levels
necessary to meet regulatory requirements related to its potential
conversion to bank holding company status. Moody's believes there
is a possibility that GMAC's offering will be a distressed
exchange. Distressed exchanges have default-like implications for
affected creditors because changes to principal amount, tenor,
coupon, and/or priority can cause debt-holders to recognize
economic loss. The downgrade reflects Moody's view that GMAC's
unsecured creditors have a heightened risk of loss as a
consequence of GMAC's plans.
GMAC's ratings also incorporate operating and financial risks
relating to GMAC's business connections with GM, its support of
and exposures to Residential Capital LLC, and its constrained
financial flexibility (see Moody's press release of October 27,
2008, the date of its last rating action, for additional
commentary).
During its review of GMAC's ratings, Moody's will consider the
effect of GMAC's exchange offering on its creditors' repayment
expectations versus original contracted terms. Additionally,
Moody's will examine the implications of GMAC's potential banking
strategy on its long-term operating stability, capital position,
liquidity, and profitability. Moody's will also analyze the
effects of GM's operating prospects and general economic
conditions on GMAC's financial performance, particularly in terms
of asset quality and profitability trends.
The ratings affected by Moody's action, all of which remain on
review for further possible downgrade, are:
GMAC LLC:
Senior Unsecured: to Caa1 from B3
Preferred Stock: to Ca from Caa3
GMAC Australia LLC:
Backed Senior Unsecured: to Caa1 from B3
GMAC Bank GMBH:
Backed Senior Unsecured: to Caa1 from B3
GMAC International Finance B.V.:
Backed Senior Unsecured: to Caa1 from B3
GMAC, Australia (Finance) Limited:
Backed Senior Unsecured: to Caa1 from B3
General Motors Acceptance Corp. (N.Z.) Limited:
Backed Senior Unsecured: to Caa1 from B3
General Motors Acceptance Corp. of Canada Ltd.:
Backed Senior Unsecured: to Caa1 from B3
GMAC LLC is a global financial services company operating in the
automotive finance, dealer and personal line insurance, and
residential real estate finance sectors. Total assets at June 30,
2008, equaled $228 billion.
GOE LIMA: Taps Taft Stettinius as Bankruptcy Counsel
----------------------------------------------------
GOE Lima LLC asks the U.S. Bankruptcy Court for the Northern
District of Ohio for authority to employ Taft Stettinius &
Hollister LLP as its counsel, nunc pro tunc to the petition date.
As the Debtor's bankruptcy counsel, Taft Stettinius will render
all necessary and appropriate legal services to be requested by
the Debtor in connection with its Chapter 11 case.
The Debtor tells the Court that prior to commencement of its
Chapter 11 case, it paid Taft a $250,000 retainer in contemplation
of its filing for Chapter 11.
As compensation for its services, Taft's professionals bill:
Professional Title Hourly Rate
------------ ----- -----------
Timorth J. Hurley, Esq. Member $415
W. Timothy Miller, Esq. Member $390
Richard L. Ferrell, Esq. Associate $260
Paige Leigh Ellerman, Esq. Associate $250
Timothy J. Hurley, Esq., a member of Taft Stettinius, assures the
Court that the firm does not hold or represent any interest
adverse to the Debtors or their estates, and that the firm is a
"disinterested person" as that term is defined in Sec. 101(14) of
the Bankruptcy Code.
Headquartered in Lima, Ohio, GOE Lima LLC -- http://www.go-
ethanol.com/ -- operates an ethanol production facility. The
company filed for protection on Oct. 14, 2008 (Bankr. N.D. Ohio
Case No. 08-35508). When the Debtor filed for protection from its
creditors, its listed assets and debts between $100 million to
$500 million each.
GRANITE XPERTS: Schedules Filing Deadline Extended to Nov. 10
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
extended, at the behest of Granite Xperts, Inc., the dealine for
the filing of the Debtor's schedules of assets and debts and
statement of financial affairs to Nov. 10, 2008.
Under Rules 1007(b) and (c) of the Federal Rules of Bankruptcy
Procedure, the Debtor must file its schedules and statement within
15 days after the filing of the Debtor's voluntary petition. The
Debtor filed for bankrutpcy on Oct. 7, 2008. Pursuant to
Bankrutpcy Rule 1007(c), the Court can extend the deadline for the
filing of the schedules and statement for cause.
The Nov. 10, 2008, deadline will give the interested parties to
review the schedules prior to the meeting of creditors, set for
Nov. 13, 2008.
The Debtor is also seeking to employ Rally Capital Services, LLC,
as its financial advisors. Rally Capital needs additional time to
assist the Debtor in the filing of its schedules and statement of
financial affairs.
Elk Grove Village, Illinois-based Granite Xperts, Inc. --
http://baykov.com/-- fabricates and installs solid surface
countertops to residendital and commercial customers in Illinois,
Michigan, Wisconsin and Indiana.
The company filed for Chapter 11 protection on Oct. 7, 2008
(Bankr. N. D. Ill. Case No. 08-26883). The company listed assets
of $1 million to $100 million, and debts of $1 million to $100
million.
GRANITE XPERTS: Wants Rally Capital as Financial Advisor
--------------------------------------------------------
Granite Xperts, Inc., asks the U.S. Bankruptcy Court for the
Northern District of Illinois to employ Rally Capital Services,
LLC, as financial advisor for the Debtor.
The Firm will, among other things, assist the Debtor in the
preparation of short term and long term cash flow budgets to be
used as part of a cash collateral order and in discussions with
the secured lender, and prepare long-term projections to be used
in connection with a Plan of Reorganization.
The Firm will charge these hourly rates to the Debtor:
Professional Rate
------------ ----
Daniel T. Lee $350
Others $150 - $250
Danile T.Lee -- a member of Rally Capital -- assures the Court
that the Firm doesn't hold or represent an interest adverse to the
Debtor. He assures the Court of the Firm's disinterestedness.
A court hearing is set for the Firm's employment for
Nov. 6, 2008.
Elk Grove Village, Illinois-based Granite Xperts, Inc. --
http://baykov.com/-- fabricates and installs solid surface
countertops to residendital and commercial customers in Illinois,
Michigan, Wisconsin and Indiana.
The company filed for Chapter 11 protection on Oct. 7, 2008
(Bankr. N. D. Ill. Case No. 08-26883). James A. Chatz, Esq., at
Arnstein & Lehr LLP assists the company in its restructuring
effort. The company listed assets of $1 million to $100 million,
and debts of $1 million to $100 million.
GWLS HOLDINGS: Wants to Files Schedules & Statements Until Dec. 19
------------------------------------------------------------------
GWLS Holdings Inc. and its debtor-affiliates ask the United States
Bankruptcy Court for the District of Delaware to further extend
the deadline to file their schedules of assets and liabilities,
and statements of financial affairs until Dec. 19, 2008.
The Debtors tell the Court that the extension will allow them to
enhance the accuracy of their schedules and statements, and
avoid any substantial amendments.
The Debtors' initial deadline is Nov. 19, 2008.
Headquartered in Dallas, Texas, GWLS Holdings Inc. --
http://www.greatwide.com/-- operate trucking and logistics
company. The company and 50 of its affiliates filed for Chapter
11 protection on Oct. 20, 2008 (Bankr. D. Del. Lead Case No.
08-12430). Robert S. Brady, Esq., at Young, Conaway, Stargatt &
Taylor LLP, as the Debtors' counsel. Willkie Farr Gallagher LLP,
represents as the Debtors' co-counsel. Miller Buckfire & Co.,
LLC, is the Debtors' financial advisor. The U.S. Trustee for
Region 3 has yet to appoint creditors to serve on an Official
Committee of Unsecured Creditors. When the Debtors filed
sought bankruptcy protection from their creditors, they listed
assets and debts between $500 million and $1 billion each.
HEXION SPECIALTY: Court Denies Lending Commitment Extension Plea
----------------------------------------------------------------
Peter Lattman at The Wall Street Journal reports that the Hon.
Eileen Bransten of the New York state court has denied Hexion
Specialty Chemicals' request to extend a lending commitment by two
banks necessary to close the buyout of Huntsman Corp.
As reported in the Troubled Company Reporter on Oct. 31, 2008,
Hexion Specialty commenced an action in the Supreme Court of the
State of New York against affiliates of Credit Suisse and Deutsche
Bank (New York County Index No. 114552/08), alleging that the
banks breached their obligations under the financing commitment
letter to fund the closing of the Hexion-Huntsman merger. The
counsel to affiliates of Credit Suisse and Deutsche Bank said that
the banks do not believe that the solvency opinion of American
Appraisal Associates and the solvency certificate of Huntsman's
Chief Financial Officer meet the condition of the commitment
letter, and stated that as a result the banks do not plan to fund
the proposed closing of the merger. Hexion Specialty sought
specific performance of the banks' obligations on an expedited
basis.
According to WSJ, Judge Bransten ruled that Credit Suisse and
Deutsche Bank didn't have to extend their funding agreement, which
was originally struck in July 2007, because the contract expired
on Nov. 1. Hexion Specialty spent the two recent months in
Delaware trying to get out of the merger itself, and had it not
spent that time, "it would not be where they are today, which is
on the eve of the commitment letter expiring," WSJ states, citing
Judge Bransten.
WSJ relates that as of Saturday, Apollo Management LP -- Hexion
Specialty's owner -- no longer has the backing of Credit Suisse
and Deutsche Bank.
Apollo Management, says WSJ, is under a separate court order in
Delaware that admonishes it to use its best efforts to close the
$6.5 billion deal. According to the report, if Apollo Management
fails to close the deal, it faces potentially billions of dollars
of damage claims by Huntsman in the Delaware Court of Chancery and
a Texas state court.
Hexion Specialty said it won't appeal Judge Bransten's ruling, WSJ
relates.
WSJ quoted Huntsman as saying, "We have our case pending in Texas,
we have our case pending in Delaware, and we will pursue both
those cases vigorously in the event that Hexion is not able to
bring its banks to the closing table."
About Huntsman
Headquartered in Salt Lake City, Utah, Huntsman Corporation
(NYSE: HUN) -- http://www.huntsman.com/-- is a manufacturer of
differentiated chemical products and inorganic chemical
products. The company operates in four segments: Polyurethanes,
Materials and Effects, Performance Products and Pigments. Its
products are used in a range of applications, including those in
the adhesives, aerospace, automotive, construction products,
durable and non-durable consumer products, electronics, medical,
packaging, paints and coatings, power generation, refining,
synthetic fiber, textile chemicals and dye industries. Its Latin
American operations are in Argentina, Brazil, Chile, Colombia,
Guatemala, Panama and Mexico.
At March 31, 2008, the company's consolidated balance sheet
showed US$8.68 billion in total assets, US$6.71 billion in total
liabilities, US$32.1 million in minority interests, and
US$1.94 billion in total stockholders' equity.
* * *
As reported by the Troubled Company Reporter on Oct. 3, 2008,
Standard & Poor's Ratings Services said that its ratings on
Huntsman Corp. and Hexion Specialty Chemicals Inc. remain on
CreditWatch with negative implications, where they were placed on
July 5, 2007. The initial CreditWatch placement followed the
announcement of Hexion's proposed debt-financed acquisition of
Huntsman in a transaction valued at more than US$10 billion,
including assumed debt.
In June 2008, S&P said that its ratings on Huntsman Corp. (BB-
/Watch Neg/--) remain on CreditWatch with negative implications,
where they were placed on July 5, 2007.
As reported in the Troubled Company Reporter on Oct. 6, 2008,
Huntsman Corp. (Huntsman - Ba3 Corporate Family Rating - Rating
Under Review For Downgrade) issued a press release on Sept. 29,
2008 announcing the decision of the Delaware Court of Chancery to
enter judgment in favor of Huntsman denying all declarations
sought by Apollo Management, L.P. and Hexion Specialty Chemicals,
Inc., in their suit requesting that the Court excuse Hexion from
its obligation to consummate the pending transaction.
About Hexion Specialty
Based in Columbus, Ohio, Hexion Specialty Chemicals Inc. --
http://www.hexionchem.com/-- is a producer of thermosetting
resins, or thermosets. Thermosets are a critical ingredient in
virtually all paints, coatings, glues and other adhesives produced
for consumer or industrial uses. Hexion Specialty Chemicals is
controlled by an affiliate of Apollo Management L.P.
Hexion Specialty Chemicals Inc.'s balance sheet at June 30, 2008,
showed total assets of $3.9 billion and total liabilities of
$5.4 billion, resulting in a shareholders' deficit of
$1.5 billion.
HUNTSMAN CORP: Court Denies Lending Commitment Extension Plea
-------------------------------------------------------------
Peter Lattman at The Wall Street Journal reports that the Hon.
Eileen Bransten of the New York state court has denied Hexion
Specialty Chemicals' request to extend a lending commitment by two
banks necessary to close the buyout of Huntsman Corp.
As reported in the Troubled Company Reporter on Oct. 31, 2008,
Hexion Specialty commenced an action in the Supreme Court of the
State of New York against affiliates of Credit Suisse and Deutsche
Bank (New York County Index No. 114552/08), alleging that the
banks breached their obligations under the financing commitment
letter to fund the closing of the Hexion-Huntsman merger. The
counsel to affiliates of Credit Suisse and Deutsche Bank said that
the banks do not believe that the solvency opinion of American
Appraisal Associates and the solvency certificate of Huntsman's
Chief Financial Officer meet the condition of the commitment
letter, and stated that as a result the banks do not plan to fund
the proposed closing of the merger. Hexion Specialty sought
specific performance of the banks' obligations on an expedited
basis.
According to WSJ, Judge Bransten ruled that Credit Suisse and
Deutsche Bank didn't have to extend their funding agreement, which
was originally struck in July 2007, because the contract expired
on Nov. 1. Hexion Specialty spent the two recent months in
Delaware trying to get out of the merger itself, and had it not
spent that time, "it would not be where they are today, which is
on the eve of the commitment letter expiring," WSJ states, citing
Judge Bransten.
WSJ relates that as of Saturday, Apollo Management LP -- Hexion
Specialty's owner -- no longer has the backing of Credit Suisse
and Deutsche Bank.
Apollo Management, says WSJ, is under a separate court order in
Delaware that admonishes it to use its best efforts to close the
$6.5 billion deal. According to the report, if Apollo Management
fails to close the deal, it faces potentially billions of dollars
of damage claims by Huntsman in the Delaware Court of Chancery and
a Texas state court.
Hexion Specialty said it won't appeal Judge Bransten's ruling, WSJ
relates.
WSJ quoted Huntsman as saying, "We have our case pending in Texas,
we have our case pending in Delaware, and we will pursue both
those cases vigorously in the event that Hexion is not able to
bring its banks to the closing table."
About Hexion Specialty
Based in Columbus, Ohio, Hexion Specialty Chemicals Inc. --
http://www.hexionchem.com/-- is a producer of thermosetting
resins, or thermosets. Thermosets are a critical ingredient in
virtually all paints, coatings, glues and other adhesives produced
for consumer or industrial uses. Hexion Specialty Chemicals is
controlled by an affiliate of Apollo Management L.P.
Hexion Specialty Chemicals Inc.'s balance sheet at June 30, 2008,
showed total assets of $3.9 billion and total liabilities of
$5.4 billion, resulting in a shareholders' deficit of
$1.5 billion.
About Huntsman
Headquartered in Salt Lake City, Utah, Huntsman Corporation
(NYSE: HUN) -- http://www.huntsman.com/-- is a manufacturer of
differentiated chemical products and inorganic chemical
products. The company operates in four segments: Polyurethanes,
Materials and Effects, Performance Products and Pigments. Its
products are used in a range of applications, including those in
the adhesives, aerospace, automotive, construction products,
durable and non-durable consumer products, electronics, medical,
packaging, paints and coatings, power generation, refining,
synthetic fiber, textile chemicals and dye industries. Its Latin
American operations are in Argentina, Brazil, Chile, Colombia,
Guatemala, Panama and Mexico.
At March 31, 2008, the company's consolidated balance sheet showed
US$8.68 billion in total assets, US$6.71 billion in total
liabilities, US$32.1 million in minority interests, and
US$1.94 billion in total stockholders' equity.
* * *
As reported by the Troubled Company Reporter on Oct. 3, 2008,
Standard & Poor's Ratings Services said that its ratings on
Huntsman Corp. and Hexion Specialty Chemicals Inc. remain on
CreditWatch with negative implications, where they were placed on
July 5, 2007. The initial CreditWatch placement followed the
announcement of Hexion's proposed debt-financed acquisition of
Huntsman in a transaction valued at more than US$10 billion,
including assumed debt.
In June 2008, S&P said that its ratings on Huntsman Corp. (BB-
/Watch Neg/--) remain on CreditWatch with negative implications,
where they were placed on July 5, 2007.
As reported in the Troubled Company Reporter on Oct. 6, 2008,
Huntsman Corp. (Huntsman - Ba3 Corporate Family Rating - Rating
Under Review For Downgrade) issued a press release on Sept. 29,
2008 announcing the decision of the Delaware Court of Chancery to
enter judgment in favor of Huntsman denying all declarations
sought by Apollo Management, L.P. and Hexion Specialty Chemicals,
Inc., in their suit requesting that the Court excuse Hexion from
its obligation to consummate the pending transaction.
INFINITY ENERGY: Inks Forbearance Deal; Loan Moved to May 31
------------------------------------------------------------
Infinity Energy Resources, Inc., entered into a Third Forbearance
Agreement dated Oct. 16, 2008, with Amegy Bank, N.A. under the
Loan Agreement dated Jan. 9, 2007, as amended and supplemented.
"We are very pleased that Amegy Bank has continued to support and
work with us as we move forward to ratify and finalize our
Nicaraguan concessions," Stanton E. Ross, chief executive officer
of Infinity Energy Resources, Inc., stated.
The Third Forbearance Agreement, along with an amendment to
Infinity's Revolving Note with Amegy, extends the maturity of the
Revolving Note until May 31, 2009, and grants a forbearance period
from June 1, 2008, to May 31, 2009. Under the Agreement, so long
as there are no further defaults, Amegy agrees not to exercise any
remedies under the Loan Agreement, the Revolving Note and related
loan documents, and to waive the existing defaults for the
forbearance period. Under certain circumstances, the forbearance
period may be extended until June 15, 2009.
The company has agreed that on or before Dec. 31, 2008, or at a
later date as agreed to by Amegy, it will have received all
governmental authorizations necessary for the validation and
ratification of its offshore Nicaraguan oil and gas concessions.
In addition, on or before Oct. 31, 2008, the company will have
obtained one or more subordinate, secured loans for use in
developing the Nicaraguan concessions and for general and
administrative expenses, the proceeds of which will be held in
escrow until Infinity receives the Governmental Approval.
Infinity also agreed to proceed with the sale and marketing of the
remaining oil and gas properties held by its subsidiary, Infinity
Oil & Gas of Wyoming, Inc. After Infinity receives the
Governmental Approval in Nicaragua, Amegy may require, in its sole
discretion, Infinity to proceed with the sale and marketing of the
assets of its wholly owned subsidiary, Infinity Oil and Gas of
Texas, Inc.
Additional information regarding the Third Forbearance
Agreement is available in Infinity's Form 8-K filing submitted to
the Securities and Exchange Commission on Oct. 22, 2008.
About Infinity Energy
Headquartered in Denver, Infinity Energy Resources Inc. (Pink
Sheets: IFNY.PK) is an independent energy company engaged in the
exploration, development and production of natural gas and oil in
Texas and the Rocky Mountain region of the United States. The
company also has oil and gas concessions covering 1.4 million
acres offshore Nicaragua in the Caribbean Sea.
Going Concern Doubt
Ehrhardt Keefe Steiner & Hottman PC, in Denver, expressed
substantial doubt about Infinity Energy Resources 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 significant working capital
deficit.
INVISTA BV: Moody's Affirms Ba2 CFR; Lowers SGL to SGL-3
--------------------------------------------------------
Moody's Investors Service affirmed INVISTA B.V.'s (IBV) Corporate
Family Rating of Ba2 and its other ratings. Moody's also lowered
IBV's speculative grade liquidity rating to SGL-3 from SGL-2
reflecting weakening operational cash flow due to softer market
conditions and the one time effects of hurricane Ike. A further
concern is the prospect, absent debt reduction via equity
infusions from IBV's parent or a restructuring, of weak headroom
under its existing bank covenants. IBV is an independently managed
wholly owned indirect subsidiary of Koch Industries, Inc. The
rating outlook is stable and assumes that IBV's parent will
continue to provide equity infusions on a timely basis as many of
IBV's end markets are likely to weaken further over the next year.
IBV's SGL-3 speculative grade liquidity rating reflects adequate
operational liquidity enhanced by recent (along with the prospect
of future) cash infusions from IBV's parent. The SGL-3 rating
reflects strong cash balances of $349 million at the end of June
2008, good availability under its $400 million revolver, further
liquidity provided by two accounts receivable facilities and a
favorable debt maturity profile tempered by the expectation of
limited headroom under its existing bank covenants in 2009 even
with the recent equity infusions.
In the 3rd quarter, IBV received (i) a significant payment
pursuant to the Tax Sharing Agreement with its parent, dated April
30, 2004 of $210 million and (ii) a $300 million equity
contribution from its parent. This cash along with existing cash
was used in part to repay borrowings under IBV's senior credit
facility. As a result of these actions Moody's believes that IBV
will be in compliance with its debt covenants at the end of the
third quarter of 2008 and IBV will have no significant drawings on
its revolver at the end of the quarter. The SGL-3 is also
supported by Moody's belief that IBV is having further
conversations with its parent about making additional equity
contributions to be used for permanent de-leveraging; Moody's will
monitor the progress of these conversations. The timeliness of
these contributions is an important factor in the ratings
affirmations and stable outlook as well as the decision to assign
the SGL-3 rating. In addition, the amount and timing of the
potential equity contributions will be dependent upon, among other
things, conversations with IBV's lenders regarding appropriate
amendments or restructuring of its current credit facilities, or
replacement of the existing credit facility in favor of a new
credit facility with limited financial covenants.
With the recent equity contribution and the prospect of additional
contributions, Moody's expects IBV to continue to have an adequate
amount of financial flexibility derived from cash on the balance
sheet at the end of September 2008 and adequate available lines of
credit, consisting of a $400 million revolver and accounts
receivable programs. Moody's believes, given the difficult
industry conditions, the company may draw under its revolver over
the next twelve months. Moody's anticipates that IBV will be
challenged to maintain compliance with existing covenants in 2009
without additional equity contributions or restructurings that are
currently being discussed. Moody's will monitor management's
efforts to adjust these covenants to provide more flexibility.
Currently under its credit agreement, IBV is required to comply
with a 4.0 times leverage ratio and a 3.0 times interest coverage
ratio.
Moody's last rating action was upgrading the corporate family
rating to Ba2 in May of 2006 and the upgrade reflected Moody's
belief that the successful integration and cost saving initiatives
completed by management, post IBV's acquisition, in April 2004, of
DuPont Textiles & Interiors' assets, resulted in a sustained
improvement in retained cash flow. This improvement in cash flow
when combined with modest debt reduction resulted in credit
metrics that support the higher rating. IBV's revenues were $9.1
billion in for the last 12 months ending June 30, 2008.
ISTAR INC: Moody's Downgrades Ratings to Ba3; Under Review
----------------------------------------------------------
Moody's Investors Service downgraded the ratings of iStar
Financial to Ba3 from Ba1. The ratings remain under review for
possible downgrade. The rating action was prompted by the REIT's
3Q08 earnings announcement, and in particular that non-performing
assets have grown to $2.5 billion (15.6 % of total assets).
Following its rating action on September 29, 2008, Moody's
indicated its expectation that non-performing assets would grow
beyond 8% of total assets and that a sharp increase in non-
performing assets could result in a multi-notch downgrade. Non-
performing assets, as reported in 3Q08, doubled in comparison to
2Q08 and exceeded Moody's expectations materially.
Moody's review will focus on iStar's expected asset performance as
the credit and commercial property markets continue to evolve, the
prospects for earnings given the economic climate, and potential
limitations to operations in a stressed scenario. More
specifically, Moody's will monitor expected EBITDA and equity
erosion, and the impact on iStar's bond and bank covenants.
Moody's expects iStar's credit metrics to weaken so as to be very
close to the thresholds established in its covenants. Moody's also
expects that iStar's asset performance will continue to experience
pressure and the resolution of its non-performing assets will be a
protracted process. In addition, Moody's anticipates iStar's
borrowers to face a very challenging refinancing environment,
increasing iStar's asset repayment risk. Moody's will continue to
monitor iStar's liquidity very closely.
A rating downgrade would result if non-performing assets grow
closer to 20% of total assets and fixed charge coverage falls
below 1.6X (based on the bond covenant definition). Any breach of
its bond or bank covenants would also result in a downgrade.
Moody's stated that a stable outlook would be predicated upon
long-term visibility into stability of iStar's non-performing
assets and fixed charge coverage, which Moody's does not see in
the medium-term.
These ratings were downgraded, and remain under review for
possible downgrade:
iStar Financial Inc. -- Senior unsecured debt to Ba3 from Ba1;
preferred stock to B2 from Ba3; senior debt shelf to (P)Ba3 from
(P)Ba1; subordinated debt shelf to (P)B1 from (P)Ba2; preferred
stock shelf to (P)B2 from (P)Ba3.
iStar Financial Inc. [NYSE: SFI] is a property finance company
that elects REIT status. iStar provides structured mortgage,
mezzanine and corporate net lease financing. iStar Financial is
headquartered in New York City, and had assets of $15.9 billion
and equity of $2.5 billion as of September 30, 2008.
JBS USA: Moody's Withdraws Ba3 Term Loan Rating
-----------------------------------------------
Moody's Investors Service withdrew the rating of a proposed
$500 million 6 year senior secured guaranteed term loan of JBS
USA, Inc. (previously Swift & Company). This withdrawal action
follows the company's decision to suspend active syndication of
the term loan. The U.S. Department of Justice has filed a lawsuit
to block parent JBS S.A. from acquiring National Beef Packing
Company LLC; JBS S.A. has announced its intention to defend itself
in this lawsuit. The term loan, partial funding for the National
Beef transaction, will not be needed unless and until the National
Beef acquisition receives regulatory approval. Moody's previous
rating action was the assignment of this rating, simultaneously
placing it under review for possible downgrade, on September 17,
2008.
Rating withdrawn:
$500 million senior secured 6 year term loan, guaranteed by JBS
S.A., at Ba3
JBS USA, Inc. is one of the world's leading beef and pork
processing companies. Its largest business segments are domestic
beef processing (62.9% of gross sales for the twenty-six weeks
ended June 29, 2008), domestic pork processing (20.1%) and beef
operations in Australia (17%). Sales from July 10, 2007, when JBS
USA, Inc. was purchased by JBS S.A., to June 29, 2008 were
approximately $10.6 billion.
JOHN MANEELY: Moody's Keeps CFR at B1; Outlook Stable
-----------------------------------------------------
Moody's Investors Service changed the rating outlook for John
Maneely Company (Maneely) and for 6582125 Canada Inc., its sister
company, to stable from under review for possible upgrade. At the
same time, Moody's confirmed all ratings (Maneely Corporate Family
Rating B1). The outlook change reflects the fact that the
company's acquisition by Novolipetsk Steel (NLMK) has not closed
as scheduled and the Carlyle Group, which owns approximately 55%
of Maneely's parent, DBO Holdings, has filed a lawsuit against
NLMK regarding breach of contract. This concludes the review for
possible upgrade initiated on August 14, 2008.
The stable outlook incorporates Moody's view that Maneely's
improved capacity utilization levels and operating profile
resulting from plant closures, reduced headcount, and lower
conversion costs, will help mitigate the weakening trends now
evident in the commercial construction market, which is a key end
market for Maneely. Moody's also expects that Maneely's management
will be able to continue to strengthen the purchasing efficiencies
of Atlas and Wheatland, thereby enhancing the company's ability to
sustain better earnings levels in a downturn than exhibited in the
past. Moody's also notes that management has taken advantage of
the favorable market conditions experienced in its fiscal year to
September 27, 2008 to deploy excess cash flow for debt reduction
thereby strengthening its overall financial profile as more
challenging business conditions develop for 2009. In addition, the
outlook anticipates that Maneely will have lower working capital
requirements over the next several quarters given the downward
movement in steel prices, which will allow for reduced borrowings
under the company's asset based revolver.
Outlook Actions:
-- Issuer: John Maneely Company
Outlook, Changed To Stable From Rating Under Review
-- Issuer: 6582125 Canada Inc.
Outlook, Changed To Stable From Rating Under Review
Confirmations:
-- Issuer: John Maneely Company
Probability of Default Rating, Confirmed at B1
Corporate Family Rating, Confirmed at B1
Gtd Sr Sec ABL Term Loan, Confirmed at Ba1, LGD 2, 19%
Gtd Sr. Sec Term Loan, Confirmed at B2, LGD 4, 59%
-- Issuer: 6582125 Canada Inc.
Gtd Sr. Sec ABL Term Loan, Confirmed at Ba1, LGD2, 19%
Headquartered in Beachwood, Ohio, Maneely manufactures small
diameter steel pipe, hollow structural steel (HSS), electrical
conduit products and tubular products at eleven manufacturing
facilities in the U.S. and Canada. The company is number one or
two in its key product areas: HSS, standard pipe and electrical
conduit. Maneely also enjoys leading market positions in the
galvanized mechanical tube and fittings markets. Its products are
sold principally to plumbing and electrical distributors.
Maneely's parent, DBO Holdings is approximately 55% owned by the
Carlyle Partners IV, LP.
LEVEL 3 COMMS: Prem Watsa et al. Discloses 9.7% Equity Stake
------------------------------------------------------------
V. Prem Watsa, 109519 Ontario Ltd., The Sixty Two Investment
Company Ltd., 810679 Ontario Ltd. and Fairfax Financial Holdings
Ltd. disclosed in a Securities and Exchange Commission filing that
they may be deemed to beneficially own 158,488,270 shares of Level
3 Communications Inc.'s common stock, representing 9.7% of the
shares issued and outstanding.
About Level 3 Communications
Headquartered in Broomfield. Colorado, Level 3 Communications Inc.
(Nasdaq: LVLT) -- http://www.level3.com/-- is a provider of
fiber-based communications services. Level 3 offers a portfolio
of metro and long haul services over an end-to-end fiber network,
including transport, data, Internet, content delivery and voice.
Level 3 Communications Inc. posted $4 million in net losses on
$902 million in net revenues for the third quarter ended Sept. 30,
2008, compared with $23 million in net profit on $765 million in
net revenues for same period ended Sept. 30, 2007.
The company posted $19 million in net losses on $2.58 billion in
net revenues for the nine months ended Sept. 30, 2008, compared
with $22 million in net profit on $2.1 billion in net revenues for
same period ended Sept. 30, 2007.
* * *
Moody's Investor's Service assigned these ratings to Level 3
Communications Inc. in June 2006: 'Caa1' long-term corporate
family rating, 'Caa2' senior unsecured debt rating, 'Caa3'
subordinated debt rating, 'Caa1' probability of default rating and
gave a stable outlook. The rating actions still hold to date.
LOCAL TV: Moody's Downgrades CFR to Caa1; Outlook Negative
----------------------------------------------------------
Moody's Investors Service downgraded Local TV Finance, LLC's
Corporate Family rating (CFR) and Probability of Default rating to
Caa1 from B2. Associated instrument ratings were also lowered, as
detailed below. The rating outlook is negative. These actions
conclude the review initiated on October 16, 2008.
The rating actions are driven by Moody?s heightened concerns that
the company will face substantial revenue and cash flow
deterioration in 2009 due to the high probability of further
weakening in the U.S. economy and its impact on advertising
revenue. The depth and the severity of the expected decline
exceeds the cyclicality built into the former B2 CFR.
The ratings and negative outlook reflect Moody's belief that the
expected revenue and cash flow declines could increase the
company's already high total debt-to-EBITDA leverage to a
significantly higher level. Notably, Moody's believes Local TV's
cash balance ($20 million as of 6/30/2008) will provide enough
cushion to absorb the cash flow declines and allow the company to
continue to pay cash interest on its senior unsecured PIK toggle
notes through 2009. However, projected negative free cash flow
associated with the downturn and net of requisite amortization
payments is expected to deplete most of this cash and, absent any
credit agreement amendments, may limit the company's access to its
currently undrawn revolving credit facility by late 2009 as it
would be expected to have little-to-no room to remain compliant
with the facility's financial leverage maintenance covenant (which
applies only if the revolver is drawn) by that time. Moody's notes
that the PIK toggle notes do offer the company some considerable
flexibility in managing its cash flows, and believes this will
become a much more heavily considered option and one that is
likely exercised next year, notwithstanding the ensuing negative
impact on the company's key credit metrics, including debt-to-
EBITDA leverage.
Moody's has taken these rating actions:
Issuer -- Local TV Finance, LLC:
Corporate Family Rating -- Downgraded to Caa1 from B2
Probability of Default Rating -- Downgraded to Caa1 from B2
$30 million Senior Secured Revolving Credit Facility -- Downgraded
to B2 from Ba3 (LGD 2, 29%)
$275 million Senior Secured Term Loan -- Downgraded to B2 from Ba3
(LGD 2, 29%)
$190 million PIK Toggle Senior Notes -- Downgraded to Caa3 (LGD 5,
84%) from Caa1 (LGD 5, 83%)
Outlook -- Revised to Negative from Review for possible downgrade
Local TV's ratings reflect significant debt-to-EBITDA leverage of
9.4x (based on EBITDA for the trailing twelve months ended June
30, 2008), minimal free cash flow generation capacity and Moody's
expectations that credit metrics (including leverage and free cash
flow generation) will come under increasing pressure in light of
the current downturn in the economy. The ratings further reflect
the company's modest scale, the inherent cyclicality of
advertising spending and the increasing business risk associated
with the broadcast television industry as advertising spending
gets fragmented over a growing number of media.
The company's ratings are supported, however, by the diversity of
Local TV's network affiliations, the diversity of cash flow from
its markets, a significant proportion of local advertising
revenues, and its dominant positions in local news and #1 or #2
positions in revenue share for most markets.
Local TV Finance, LLC, headquartered in Fort Worth, Texas, owns
nine television broadcasting stations in eight mid-sized markets
(DMAs 43-100).
LODGENET INTERACTIVE: Sept. 30 Balance Sheet Upside-Down by $80MM
-----------------------------------------------------------------
LodgeNet Interactive Corp.'s balance sheet as of Sept. 30, 2008,
showed $637.5 million in total assets, $717.46 million in total
liabilities, resulting to $79.96 million in shareholders' deficit.
The company also had $394.39 million in accumulated deficit.
The company posted $6.28 million in net losses on $135.32 million
in net revenues for the third quarter ended Sept. 30, 2008,
compared with $11.41 million in net losses on $142.63 million in
net revenues for the third quarter ended Sept. 30, 2007.
The company has updated its outlook for 2008 utilizing the
forecasting methodology used for 2008, updated to reflect year-to-
date results and the impact of recent operating trends. The
company continues to expect enhancements to its run-rate Adjusted
Operating Cash Flow during the Fourth Quarter from additional
operating synergies, TV Programming margin expansion and the sale
of systems to hotels and hospitals; but expects those enhancements
will be offset by a decline in Guest-Entertainment revenue.
For the year, the company expects that movie revenues will be
7.0% to 8.0% below 2007 levels. As a result, the company expects
to report 2008 revenue in the range of $537.0 million to $541.0
million and Adjusted Operating Cash Flow in the range from $134.5
million to $137.5 million. Net loss is expected to be $38.0
million to $35.0 million or loss per share of $1.71 to $1.57.
Adjusted Net Loss is expected to be $22.5 million to $19.5 million
or $1.01 to $0.88 per share. Net Free Cash Flow is expected to be
in a range of $17.5 million to $20.0 million and Adjusted Net Free
Cash Flow is expected to be $26.5 million to $29.5 million.
Full-text copy of the LodgeNet Interactive's third quarter results
is available free of charge at:
http://researcharchives.com/t/s?3467
About LodgeNet Interactive
Based in Sioux Falls, South Dakota, LodgeNet Interactive Corp.
(NASDAQ: LNET) -- http://www.lodgenet.com/-- is a provider of
media and connectivity solutions designed to meet the unique needs
of hospitality, healthcare and other guest-based businesses.
LodgeNet Interactive serves more than 1.9 million hotel rooms
representing 9,300 hotel properties worldwide in addition to
healthcare facilities throughout the United States. The company's
services include: Interactive Television Solutions, Broadband
Internet Solutions, Content Solutions, Professional Solutions and
Advertising Media Solutions. LodgeNet Interactive Corporation
owns and operates businesses under the industry leading brands:
LodgeNet, LodgeNetRX, and The Hotel Networks.
* * *
As reported in the Troubled Company Reporter on March 24, 2008,
Standard & Poor's Ratings Services revised its outlook on LodgeNet
Interactive Corp. to negative from stable and affirmed the 'B+'
corporate credit rating on the company.
MAXJET AIRWAYS: Judge Walsh Approves Plan Disclosure Statement
--------------------------------------------------------------
The Hon. Peter J. Walsh of the United States Bankruptcy Court for
the District of Delaware approved a disclosure statement
describing a joint Chapter 11 plan of liquidation dated Oct. 2,
2008, filed by MAXjet Airways Inc. and the Official Committee of
Unsecured Creditors. The Court held that the disclosure statement
contains adequate information within the meaning of Section 1125
of the Bankruptcy Code.
A hearing is set for Dec. 17, 2008, at 2:00 p.m., to consider
confirmation of the plan. Objections, if any, are due Dec. 10,
2008.
The Court also approved procedures proposed by the Debtor for
tabulation and solicitation of plan votes. Deadline for voting
for the plan is Dec. 8, 2008.
Overview of the Plan
The plan contemplates the liquidation of the Debtor's remaining
assets. The proceeds from the liquidation will be distributed to
the Debtor's creditors in accordance with the distributive
provisions and priority scheme of the Bankruptcy Code.
Under the plan, a liquidation trust will be created, which will be
administered by a liquidation trustee. The Debtor's assets will
be transferred to trust for the benefit of creditors on the plan's
effective date. The liquidation trustee will be responsible for
winding down the Debtor's remaining assets and making
distributions to creditors in accordance with the terms of the
plan.
According to the Troubled Company Reporter on April 18, 2008, the
Court authorized the Debtor to sell its assets to MAXjet Airways
Acquisition Group LLC owned by NCA Sports Group Inc. for
$1,000,000. MAAG, however, failed to full its obligations under
a certain agreement, including:
i) furnishing necessary documentation to complete the
application of the U.S. Department of Transportation in
order to have the certificate of authority transferred, and
ii) payment of certain operating expenses of the Debtor that
MAAG agreed to pay until closing.
MAXjet is planning to sue the purchaser to fund the plan,
Bloomberg News reports. MAXjet expects to recover $5.5 million
through lawsuits, and distribute $3.2 million to unsecured
creditors after paying expenses and priority claims, the report
says.
The plan classifies interests against and liens in the Debtor in
four classes. The classification of interests and claims are:
Treatment of Interests and Claims
Type Estimated Estimated
Class of Claims Treatment Amount Recovery
----- --------- --------- --------- ---------
1 Priority impaired $220,000 100%
Non-Tax
2 Secured unimpaired $576,000 100%
3 Unsecured impaired $22,895,793 14%
4 Interests impaired unstated canceled
Class 1 and 3 are entitled to vote to accept or reject the plan.
Each holder of Class1 priority non-tax claims will be paid in cash
on account of the amount of the allowed claim from the liquidation
trust on a pro rata basis after all administrative claims are
paid.
At the liquidation trust's discretion, holders of Class 2 secured
claims will receive:
i) cash equal to the allowed secured claim from the estate
assets on the plan's effective date;
ii) the collateral securing the claim; or
iii) satisfy the claim as may be agreed upon by the trustee and
the holder.
Holders of Class 3 unsecured claims will receive cash distribution
on a pro rata basis from the amounts held in the liquidation trust
after Class 1 and administrative claims are paid.
Holders of Class 4 interest will not receive distribution, under
the plan.
A full-text copy of the Debtor's Joint Chapter 11 Plan of
Liquidation is available for free at:
http://ResearchArchives.com/t/s?346a
A full-text copy of the Debtor's Disclosure Statement is available
for free at:
Part One: http://ResearchArchives.com/t/s?346b
Part Two: http://ResearchArchives.com/t/s?346c
About MAXjet Airways
Headquartered in Dulles, Virginia, MAXjet Airways Inc. --
http://www.maxjet.com/-- is an all-business class, long-haul
airline company. It has introduced scheduled services with
flights from London Stansted Airport to New York. As of
December, 2006, it leased five B767 aircraft. Its customers are
both business and leisure travelers. At the airport, its product
features check-in facilities located in primary terminals,
security and a business class departure lounge and arrivals
facility. Its flights features deep-recline seats (170 degree)
spaced at a 60 inch pitch, portable entertainment systems, stowage
space and business class catering. The Debtor filed for chapter
11 protection on Dec. 24, 2007 (Bankr. D. Del. Case No. 07-11912).
The Debtor selected Pachulski Stang Ziehl & Jones LLP and
Pillsbury Winthrop Shaw Pittman LLP as its bankruptcy counsels.
The Debtor selected Epiq Bankruptcy Services LLC as claims,
noticing and claims agent. Arent Fox LLP represents the Official
Committee of Unsecured Creditors. The Debtor's summary of
schedules showed assets of $14,836,147 and debts of $26,697,104.
MCDONALD TECHNOLOGIES: Moody's Withdraws Junk Ratings
-----------------------------------------------------
Moody's Investors Service has withdrawn these ratings for McDonald
Technologies International, Inc.:
Corporate Family Rating: Caa1
Probability of default rating: Caa2
$14 million senior secured term loan: Caa1 (LGD3 -- 36%)
Moody's has withdrawn these ratings for business reasons.
The previous rating action occurred on October 16, 2008 when
Moody's downgraded McDonald Technologies' corporate family and
senior secured term loan ratings to Caa1 from B3 and probability
of default rating to Caa2 from B3. Simultaneously, the ratings
outlook was revised to negative from stable.
Headquartered in Farmers Branch, Texas, McDonald Technologies is
an EMS company engaged in the assembly of PCB, back-planes, cable
harnesses, and electro-mechanical assemblies. Focusing on high-
mix/low volume production and design capabilities, the company's
products are used for applications including communications,
seismic imaging, electronic voting systems, industrial controls
and aerospace industries.
MEDICOR LTD: Plan Filing Period Extended to December 5
------------------------------------------------------
Bill Rochelle of Bloomberg News reports that the United States
Bankruptcy Court for the District of Delaware further extended the
exclusive periods of MediCor Ltd. and its debtor-affiliates to:
a) file a Chapter 11 plan until Dec. 5, 2008, and
b) solicit acceptances of that plan until Feb. 3, 2008.
According to the Troubled Company Reporter on Oct. 3, 2008, the
Debtors, lenders and receiver Larry Bertch have reached a
settlement in principle, under which all of the receiver's claims
will be resolved and the two adversary proceedings and appeal
filed by the receiver will be withdrawn. The settlement is
subject to approval of the state and federal courts in Nevada due
to its nature of claims, among other things.
The agreement contemplates the settlement of all claims against
the Debtors arising from the alleged misdirection of funds by
former chairman and director of MediCor Donald McGhan, including
the receiver and entities who:
a) were customers of SouthWest Exchange Inc. and Qualified
Exchange Services;
b) directly or indirectly transferred any assets to or deposited
any assets with SWX or QES; or
c) directly or indirectly suffered any loss arising out of, in
connection with, or in any way related to the failure of SWX
or QES to make payments or transfers of assets to their
customers.
Mr. Bertch was appointed to serve as the receiver of several
companies owned by Mr. McGhan, including SWX and QES. The
companies were placed in receivership because they are alleged to
have been involved in a purported diversion of as much as
$80 million by Mr. McGan from companies under his control.
The extension will enable the Debtors to obtain approval of the
settlement from the Nevada state and federal courts, and finalize
the terms of a consensual Chapter 11 plan.
About MediCor
Based in North Las Vegas, Nevada, MediCor Ltd. --
http://www.medicorltd.com/-- manufactures and markets products
primarily for aesthetic, plastic and reconstructive surgery and
dermatology markets. The company and seven of its affiliates
filed for chapter 11 protection on June 29, 2007 (Bankr. D. Del.
Case No. 07-10877) to effectuate the orderly marketing and sale of
their business. Kenneth A. Rosen, Esq., Jeffrey D. Prol, Esq.,
and Jeffrey A. Kramer, Esq., at Lowenstein Sandler PC represent
the Debtors in their restructuring efforts.
Dennis A. Meloro, Esq., and Victoria Watson Counihan, Esq., at
Greenberg Traurig, LLP, act as the Debtors' Delaware counsel.
The Debtors engaged Alvarez & Marsal North America, LLC as their
restructuring advisor. David W. Carickhoff, Jr., Esq., and Jason
W. Staib, Esq., at Blank Rome LLP serve as the Official Committee
of Unsecured Creditor's counsel. In its schedules of assets and
debts filed with the Court, Medicor disclosed total assets of
$96,553,019, and total debts of $158,137,507.
MERVYN'S LLC: CREDITORS WANT ESTATE LIQUIDATED UNDER CH. 7
----------------------------------------------------------
The Official Committee of Unsecured Creditors of Mervyn's LLC
asked the U.S. Bankruptcy Court for the District of Delaware to
convert the Chapter 11 cases of Mervyn's LLC and its affiliated
debtors to Chapter 7, pursuant to Sections 1112(b) and 105(a) of
the Bankruptcy Code.
At a hearing held October 30, 2008, Judge Gross ruled that the
Creditors' Committee's request to convert the Debtors' cases to
Chapter 7 has been consensually resolved during the hearing, which
will be documented in a stipulation to be filed with the Court.
In the Committee's request for conversion, Karen B. Skomorucha,
Esq., at Ashby & Geddes, PA, in Wilmington, noted that the Court
may convert a Chapter 11 case to Chapter 7 for "cause" upon the
request of a party-in-interest. According to Ms. Skomorucha, as
a result of the 2005 amendments to the Bankruptcy Code, Section
1112(b) now provides a non-exclusive list of "causes" for
conversion:
(a) substantial or continuing loss to or diminution of the
estate and the absence of a reasonable likelihood of
rehabilitation;
(b) gross mismanagement of the estate;
(c) failure to maintain appropriate insurance that poses a
risk to the estate or the public;
(d) unauthorized use of cash collateral substantially harmful
to one or more creditors;
(e) failure to comply with an order of the Court;
(f) unexcused failure to satisfy timely any filing or
reporting requirement established by the Bankruptcy Code
or by any Rule applicable to a Chapter 11 case;
(g) failure to attend the meeting of creditors convened under
Section 341(a) of the Bankruptcy Code or an examination
ordered under Rule 2004 of the Federal Rules of
Bankruptcy Procedures without good cause shown by the
Debtor;
(h) failure to timely provide information or attend meetings
reasonably requested by the United States Trustee;
(i) failure to pay taxes owed after the date of the order for
relief or to file tax returns due after the date of the
order for relief;
(j) failure to file a disclosure statement, or to file or
confirm a plan, within the time fixed by the Bankruptcy
Code or by order of the Court;
(k) failure to pay any fees or charges required under Chapter
123 of Title 28;
(l) revocation of an order of confirmation under Section 1144;
(m) inability to effectuate substantial consummation of a
confirmed plan of reorganization;
(n) material default by the Debtor with respect to a confirmed
plan; and
(o) termination of a confirmed plan by reason of the
occurrence of a condition specified in the plan.
The Committee contends conversion is warranted where a Debtor is
suffering continuing loss to or diminution of the estate and the
absence of a reasonable likelihood of rehabilitation. As
evidenced by the Debtors' plans to hold going out of business
sales at all of their remaining 149 locations and to wind down
their business, the Debtors concede that a reorganization of its
business is impossible, the Committee avers.
". . . the Debtors have no intention to reorganize or
rehabilitate," Ms. Skomorucha says. "Rather, the Sale Motion
contemplates an immediate liquidation of substantially all of the
Debtors' assets that is not expected to yield proceeds sufficient
to fund a confirmable Chapter 11 plan of liquidation."
According to Ms. Skomorucha, the Committee and the Court cannot
reasonably be asked to support a sale process, particularly where
the process would extinguish any prospect of a meaningful
distribution for administrative, priority and unsecured creditors
through recoveries that might otherwise have been achieved in the
Litigations. The Committee avers that the Senior Lenders are
abusing the Chapter 11 process by proposing to liquidate their
collateral through a process that exclusively benefits them.
"Unless and until the Senior Lenders agree to fund the sale
process, the wind down and reasonable cost and expense of
pursuing the Litigations for the benefits of other creditors,
they should be denied the benefits of the Chapter 11 process,"
Ms. Skomorucha contends.
Mr. Skomorucha relates that the vast majority of the Debtors'
assets, which include real property, inventory, fixtures,
furniture and equipment, and leases, have not been fixed, sold or
liquidated. Thus, there are significant assets for a Chapter 7
trustee to oversee and liquidate for the benefit of all
creditors, she adds.
According to the Committee, a Chapter 7 trustee could determine
the extent of the Debtors' assets, investigate and pursue
potential causes of action against creditors and insiders of the
Debtors, investigate validity of alleged liens of the Senior
Lenders and the Junior Insider Entities, and confirm existence of
any other assets currently unknown to the Committee.
Absent the Debtors' ability to pay the proposed sale and wind
down process and for the pursuit of the Litigations, the Sale
Motion is nothing more than an attempt to obtain the benefits
afforded by Section 363 of the Bankruptcy Code without bearing
the burdens and obligations of a legitimate reorganization, the
Committee avers.
The Committee subsequently filed a supplement and an affidavit in
support of their request, and have asked the Court's permission
to file these documents under seal. The Committee said the
documents contain confidential information.
Debtors' Response
In response, the Debtors contended that the Committee has not
established that "cause" exists to convert their cases to Chapter
7.
Christopher M. Samis, Esq., at Richards, Layton & Finger, PA, in
Wilmington, Delaware, relates the Debtors have acknowledged that
they would be unable to confirm a plan under Section 1129 of the
Bankruptcy Code due to a potential administrative expense
shortfall. However, Mr. Samis notes, provided that the Debtor-
in-possession lenders agree to fund the Debtors' wind-down budget
so that the administrative expense shortfall will not increase
during the store closing sale process, there are compelling
reasons to permit the Debtors to remain in Chapter 11.
Moreover, Mr. Samis avers, if the Debtors' cases are converted,
the administrative claimants would not be paid in full because of
the delay and disruption in the store closing sale process which
would inevitably ensue.
Accordingly, the Debtors ask the Court to approved their Store
Closing Motion and deny the Committee's Conversion Motion.
The parties' stipulation that resolves the Conversion Motion has
yet to be filed with the Court.
About Mervyn's LLC
Headquartered in the San Francisco Bay Area, Mervyn's LLC --
http://www.mervyns.com/-- provides a mix of top national brands
and exclusive private labels. Mervyn's has 176 locations in seven
states. Mervyn's stores have an average of 80,000 retail square
feet, smaller than most other mid-tier retailers and easier to
shop, and are located primarily in regional malls, community
shopping centers, and freestanding sites.
The company and its affiliates filed for Chapter 11 protection on
July 29, 2008, (Bankr. D. Del. Lead Case No.: 08-11586). Howard
S. Beltzer, Esq., and Wendy S. Walker, Esq., at Morgan Lewis &
Bockius LLP, and Mark D. Collins, Esq., Daniel J. DeFranceschi,
Esq., Christopher M. Samis, Esq. and L. Katherine Good, Esq., at
Richards Layton & Finger P.A., represent the Debtors in their
restructuring efforts. Kurtzman Carson Consultants LLC is the
Debtors' claims agent. The Debtors' financial advisor is Miller
Buckfire & Co. LLC. Mervyn's LLC's balance sheet at Aug. 30,
2008, showed $665,493,000 in total assets and $717,160,000 in
total liabilities resulting in a $51,667,000 total stockholders'
deficit.
(Mervyn's Bankruptcy News; Bankruptcy Creditors' Service
Inc., http://bankrupt.com/newsstand/or 215/945-7000)
MERVYN'S LLC: Seeks to Pay Employee Incentives at Closing Sales
---------------------------------------------------------------
Pursuant to Sections 363(b) and 503(c) of the Bankruptcy Code,
Mervyn's LLC and its affiliated debtors ask the U.S. Bankruptcy
Court for the District of Delaware to approve a retention plan,
incentive plan and relief from complying with various state "fast
pay" laws and regulations. The Debtors believe that the ancillary
relief is necessary in order to successfully effectuate the Final
Store Closing Sales and to maximize the return available for
distribution to the Debtors' creditors.
Retention and Incentive Plans
Christopher M. Samis, Esq., at Richards, Layton & Finger, PA, in
Wilmington, Delaware, relates that the announcement of the
closing of all of the Debtors' remaining retail locations will
undoubtedly result in the departure of a significant number of
the Debtors' key non-insider employees at the Debtors'
headquarters. According to Mr. Samis, the Debtors have
identified 93 non-insider headquarters employees who are critical
to their operations and, therefore, to the success of the
Debtors' Final Store Closing Sales and ultimate liquidation.
"The uncertainty among employees since the Petition Date and
during the last several weeks of turmoil in the economy generally
and the announcement that the Debtors will be winding down their
business has had a devastating effect on employee morale,
resulting in large numbers of experienced senior people resigning
at an ever-increasing rate," Mr. Samis says.
The Debtors believe they need to offer key non-insider
headquarters employees a bonus in order to induce them to remain
and efficiently administer the Closing Sales and the liquidation
process. The Debtors aver that the key employees will quit,
their operations will be significantly impaired and their ability
to effectively conduct the Final Store Closing Sales and attend
to the myriad of other tasks required to wind-down their business
could be substantially impacted.
According to the Debtors, none of the 93 key non-insider
headquarters employees holds a rank of Vice President or higher
and none of the participants exercises any control or policy-
making functions of the Debtors.
The Debtors relate that each of the participants will be eligible
to receive a lump sum bonus, to the extent that the participant
remains in the Debtors until a specified date and executes a
release in favor of the Debtors. If the participant resigns, is
terminated for cause, or fails to return any employer property,
the participant will not be entitled to the lump sum bonus
payment.
The participants covered under the Retention Plan fall into four
tiers:
-- Tier I participants are eligible to receive a bonus equal
to one week of the participant's base salary for each week
retained after November 1, 2008, provided that the
participant remains with the Debtors through December 15,
2008, if required, or is terminated by the Debtors without
cause;
-- Tier II participants are eligible to receive a bonus equal
to two months of the participant's base salary, provided
that the participant remains in the Debtors' employ through
January 31, 2009, or is terminated by the Debtors without
cause;
-- Tier III participants are eligible to receive a
bonus equal to three months of the participant's base
salary, provided that the participant remains in the
Debtors' employ through March 31, 2009, or is terminated by
the Debtors without cause; and
-- Tier IV participants are eligible to receive a bonus equal
to four months of the participants base salary, provided
that the participant remains in the Debtors' employ through
June 30, 2009, or is terminated by the Debtors without
cause.
The Debtors estimate that the aggregate potential payout of
retention bonuses under the Retention Plan is $1,311,684 and the
aggregate accrued vacation and personal day pay for the key
employees is $520,339.
The Incentive Plan
The Debtors say that the Incentive Plan is designed to provide
the Debtors' Senior Executives with appropriate incentives in
order to motivate them to manage the Debtors' operations strictly
in accordance with the Debtors' wind-down budget and realize the
maximum amount of revenue possible from the Final Store Closing
Sales and the liquidation of the Debtors' other assets.
The Debtors relate that their Senior Executives have already had
extraordinary demands placed upon them since the Petition Date in
conjunction with the Debtors' efforts to stabilize and improve
the profitability of their business and pursue a stand-alone
reorganization or going-concern sale.
The Debtors tell the Court that the Incentive Plan is limited to
six executive-level employees:
(a) Executive Vice President, Chief Financial Officer and
Administrative Officer;
(b) Senior Vice President, General Counsel and Secretary;
(c) Senior Vice President and Chief Information Officer;
(d) Vice President and Treasurer;
(e) Senior Vice President and Supply Chain Manager; and
(f) Vice President of Merchandise Planning.
The incentive bonuses for Chief Financial and Administrative
Officer are:
Task I Maximum Incentive Bonus $212,000
Task II Maximum Bonus 26,500
Task II Maximum Incentive Bonus 26,500
Accrued Vacation Pay 31,264
The incentive bonuses for the other Senior Executives are:
Maximum Potential Accrued
Name Incentive Bonus Vacation Pay
----- ----------------- ------------
General Counsel $47,500 $34,398
Treasurer 39,167 11,753
Supply Chain Manager 29,147 34,367
CIO 58,334 10,546
VP of Merchandise 25,000 67,500
Under the Incentive Plan, in addition to the Senior Executive's
regular wages, (i) the General Counsel, the Treasurer and the CIO
will be eligible to receive a lump sum bonus payment to the
extent that the Senior Executive, in addition to completing his
or her day-to-day duties, completes Task I and achieves a return
of 100% of the Guaranteed Amount of the aggregate Cost Value of
the Inventory as set forth in the final Agency Agreement, (ii)
the Supply Chain Manager will be eligible to receive a lump sum
bonus payment equal to one month of the executive's base salary
to the extent the executive completes distribution operations by
November 25, 2008, and (iii) the VP of Merchandise will be
eligible to receive a lump sum bonus payment to one month of the
executive's base salary to the extent the executive
systematically allocates all product and merchandising support
functions by November 15, 2008.
Also pursuant to the Incentive Plan, the CFO will be eligible to
receive (i) an amount equal to 50% of each of the bonuses, which
will be payable at the later of the completion of the applicable
task or the payment in full of all obligations outstanding under
the Debtor-in-possession Agreement and (ii) an amount equal to
50% of the bonuses, which will be payable upon the earlier of
June 30, 2009, or the date that the CFO is terminated for cause.
The CRO and the Tier IV employees will also be entitled to
receive discretionary incentive bonus up to a maximum of three
month's total salary based on criteria to be determined by the
Debtors' management after consultation with and consent of the
Debtors' advisors, the Committee, counsel for the agent to the
DIP Lenders and the counsel for the Prepetition Second Lien
Lenders.
The Debtors estimate that the aggregate potential payout under
the Incentive Plan is $487,897 and that the aggregate accrued
vacation and personal day pay for this group of employees is
$188,550.
U.S. Trustee Opposes Approval of Incentive Plan
Roberta A. DeAngelis, acting United States Trustee for Region 3,
contends the Debtors have not satisfied their burden under
Section 503 of the Bankruptcy Code that (i) payments under the
Incentive Plan are not retention payments to "insiders", (ii) the
Incentive Plan is justified by the facts and circumstance of the
Debtors' cases, and (iii) the Incentive Plan represents the
actual, necessary cost of preserving the estates.
Ms. DeAngelis relates although the Motion characterizes the bonus
plan as 'Incentive Plan,' it is primarily structured as a
retention plan. According to Ms. DeAngelis, if the only
incentive created by the Incentive Plan is to induce the insiders
to remain with the Debtors until the liquidation is complete, the
Motion must be denied because it fails to comply with Section 503
of the Bankruptcy Code.
"The lack of true performance benchmarks suggests that the
Incentive Plan is intended as a disguised retention bonus instead
of a true incentive plan," Ms. DeAngelis contends. "Further, the
discretionary component of the CFO's proposed incentive
compensation is also objectionable because there are no
performance benchmarks associated with it."
Accordingly, the Ms. DeAngelis asks the Court to deny the
Debtors' Incentive Plan.
* * *
Judge Gross authorized the Debtors to make payments under the
Retention Plan and the Incentive Plan. Judge Gross held that
postpetition payments under the Plans will be administrative
expenses of the estates pursuant to Section 503(b) of the
Bankruptcy Code.
Moreover, Judge Gross held that his Order is without prejudice to
the right of the Debtors and their estates to apply to the Court
for additional payments or consideration to be made to any
employee, whether subject to Section 503(c) of the Bankruptcy
Code or otherwise.
Judge Gross ordered that the Debtors will not be required to
comply with any state "fast pay" laws and regulations when
terminating employees.
About Mervyn's LLC
Headquartered in the San Francisco Bay Area, Mervyn's LLC --
http://www.mervyns.com/-- provides a mix of top national brands
and exclusive private labels. Mervyn's has 176 locations in seven
states. Mervyn's stores have an average of 80,000 retail square
feet, smaller than most other mid-tier retailers and easier to
shop, and are located primarily in regional malls, community
shopping centers, and freestanding sites.
The company and its affiliates filed for Chapter 11 protection on
July 29, 2008, (Bankr. D. Del. Lead Case No.: 08-11586). Howard
S. Beltzer, Esq., and Wendy S. Walker, Esq., at Morgan Lewis &
Bockius LLP, and Mark D. Collins, Esq., Daniel J. DeFranceschi,
Esq., Christopher M. Samis, Esq. and L. Katherine Good, Esq., at
Richards Layton & Finger P.A., represent the Debtors in their
restructuring efforts. Kurtzman Carson Consultants LLC is the
Debtors' claims agent. The Debtors' financial advisor is Miller
Buckfire & Co. LLC. Mervyn's LLC's balance sheet at Aug. 30,
2008, showed $665,493,000 in total assets and $717,160,000 in
total liabilities resulting in a $51,667,000 total stockholders'
deficit.
(Mervyn's Bankruptcy News; Bankruptcy Creditors' Service
Inc., http://bankrupt.com/newsstand/or 215/945-7000)
MERVYN'S LLC: Claims Bar Date Fixed to Jan. 9, 2009
---------------------------------------------------
Judge Gross sets January 9, 2009, as general claims bar date for
proofs of claim against Mervyn's LLC and its affiliated debtors.
Judge Gross held that the General Bar Date applies to all types of
Claims against the Debtors that arose prior to the Petition Date,
including secured claims, unsecured priority claims, and general
unsecured claims. The deadline for governmental units holding
claims against the Debtors is on January 26, 2009.
Judge Gross held that the Debtors will retain the right to:
(a) dispute, or assert offsets or defenses against, any filed
Claim or any Claim listed or reflected in the Schedules of
Assets and Liabilities as to the nature, amount,
liability, classification, or otherwise; or
(b) subsequently designate any Claim as disputed, contingent,
or unliquidated.
Judge Gross found that a holder of any Claim arising from the
rejection of an executory contract or unexpired lease will be
required to file a proof of claim on account of the Rejection
Damages Claim against the Debtors by the Rejection Bar Date which
will be the later of the Bar Date applicable to the Claim or 30
days after the entry date of the Rejection Order.
About Mervyn's LLC
Headquartered in the San Francisco Bay Area, Mervyn's LLC --
http://www.mervyns.com/-- provides a mix of top national brands
and exclusive private labels. Mervyn's has 176 locations in seven
states. Mervyn's stores have an average of 80,000 retail square
feet, smaller than most other mid-tier retailers and easier to
shop, and are located primarily in regional malls, community
shopping centers, and freestanding sites.
The company and its affiliates filed for Chapter 11 protection on
July 29, 2008, (Bankr. D. Del. Lead Case No.: 08-11586). Howard
S. Beltzer, Esq., and Wendy S. Walker, Esq., at Morgan Lewis &
Bockius LLP, and Mark D. Collins, Esq., Daniel J. DeFranceschi,
Esq., Christopher M. Samis, Esq. and L. Katherine Good, Esq., at
Richards Layton & Finger P.A., represent the Debtors in their
restructuring efforts. Kurtzman Carson Consultants LLC is the
Debtors' claims agent. The Debtors' financial advisor is Miller
Buckfire & Co. LLC. Mervyn's LLC's balance sheet at Aug. 30,
2008, showed $665,493,000 in total assets and $717,160,000 in
total liabilities resulting in a $51,667,000 total stockholders'
deficit.
(Mervyn's Bankruptcy News; Bankruptcy Creditors' Service
Inc., http://bankrupt.com/newsstand/or 215/945-7000)
MERVYN'S LLC: Removal Period for Civil Actions Extended to Jan. 9
-----------------------------------------------------------------
Judge Gross extended Mervyn's LLC's time to file notices of
removal of civil actions to February 24, 2009.
Since the Petition Date, the Debtors have focused on stabilizing
their business and ensuring a smooth transition into Chapter 11
while, at the same time, focusing on other time-sensitive aspects
of their Chapter 11 cases, says Katherine L. Good, Esq., at
Richards, Layton & Finger, PA, in Wilmington, Delaware.
According to Ms. Good, among other significant tasks, in the
early weeks of the Bankruptcy cases, the Debtors have:
(i) obtained interim and final approval of their $465,000,000
debtor-in-possession credit facility; and
(ii) obtained approval to conduct store closing sales at 26 of
their retail store locations in the United States, which
sales are currently in process.
Ms. Good relates the Debtors are continuing to review their files
and records to determine whether they should remove any claims or
civil causes of action that may be pending in state or federal
court to which they might be a party. The Debtors are parties to
numerous lawsuits and are still assessing the lawsuits to
determine whether removal is warranted, Ms. Good adds.
The Debtors believe the extension will provide sufficient time to
allow them to consider, and make decisions concerning, the
removal of the Civil Actions, although they reserve the right to
request additional extensions if appropriate.
About Mervyn's LLC
Headquartered in the San Francisco Bay Area, Mervyn's LLC --
http://www.mervyns.com/-- provides a mix of top national brands
and exclusive private labels. Mervyn's has 176 locations in seven
states. Mervyn's stores have an average of 80,000 retail square
feet, smaller than most other mid-tier retailers and easier to
shop, and are located primarily in regional malls, community
shopping centers, and freestanding sites.
The company and its affiliates filed for Chapter 11 protection on
July 29, 2008, (Bankr. D. Del. Lead Case No.: 08-11586). Howard
S. Beltzer, Esq., and Wendy S. Walker, Esq., at Morgan Lewis &
Bockius LLP, and Mark D. Collins, Esq., Daniel J. DeFranceschi,
Esq., Christopher M. Samis, Esq. and L. Katherine Good, Esq., at
Richards Layton & Finger P.A., represent the Debtors in their
restructuring efforts. Kurtzman Carson Consultants LLC is the
Debtors' claims agent. The Debtors' financial advisor is Miller
Buckfire & Co. LLC. Mervyn's LLC's balance sheet at Aug. 30,
2008, showed $665,493,000 in total assets and $717,160,000 in
total liabilities resulting in a $51,667,000 total stockholders'
deficit.
(Mervyn's Bankruptcy News; Bankruptcy Creditors' Service
Inc., http://bankrupt.com/newsstand/or 215/945-7000)
MGM MIRAGE: Moody's Assigns (P)Ba1 to Proposed Benchmark Notes
--------------------------------------------------------------
Moody's Investors Service downgraded MGM MIRAGE's (MGM) Corporate
Family rating and Probability of Default rating to Ba3 from Ba2.
Moody's also downgraded MGM's senior unsecured bond rating to Ba3
from Ba2 and its senior subordinated bond rating to B2 from B1.
Moody's also assigned a (P)Ba1 provisional rating to the company's
proposed benchmark senior secured guaranteed note. All ratings
remain on review for further possible downgrade. The company's
Speculative Grade Liquidity rating was also downgraded to SGL-4
from SGL-3.
The downgrade of MGM's ratings reflect rising leverage and weaker
interest coverage due to declining gaming demand and Moody's view
that the company's earnings will remain under pressure over the
next 12 months. Additionally, MGM faces high business risk
associated with the completion and ramp-up of its 50% owned City
Center project that may require more sponsor support than
currently anticipated.
The (P)Ba1 rating on MGM's proposed senior secured notes reflect
the superior position of the proposed notes relative to a large
amount ($13 billion) of MGM's existing senior and subordinated
unsecured debt. The proposed note is expected to be secured by
MGM's New York New York casino resort located on the Las Vegas
strip and guaranteed by all domestic subsidiaries that guaranty
MGM's other public and bank debt.
The downgrade of the SGL rating to SGL-4 reflects significant
refinancing risk in 2009 that cannot be supported from Moody's
projected internal cash flow and current revolver availability. If
MGM is able to create additional capacity under its revolving
credit facility or improve liquidity via other means and Moody's
become comfortable that it will remain comfortably in compliance
with financial covenants, the SGL rating could be upgraded to SGL-
3.
Ratings remain on review for further possible downgrade reflecting
volatile market conditions that could hamper the company's ability
to close the proposed new senior secured note offering and
complete the second phase of the $3.0 billion financing for City
Center, as well as the decline demand environment for gaming. The
review for possible downgrade will focus on MGM's success at
shoring up its liquidity profile via the benchmark senior secured
note offering, and syndication of the City Center financing. It
will also focus on MGM's ability to maintain a credit profile and
financial flexibility appropriate for a Ba3 rating within the
depressed Las Vegas lodging and gaming environment. This is
particularly key given the need to complete and ramp up the
massive City Center project in the midst of an unfavorable macro-
economic environment.
Ratings downgraded and remaining on review for further possible
downgrade.
MGM MIRAGE
Corporate Family Rating to Ba3 from Ba2
Probability of default rating to Ba3 from Ba2
Senior unsecured notes to Ba3 from Ba2
Senior subordinated notes to B2 from B1
Speculative Grade Liquidity Rating to SGL-4 from SGL-3
Mirage Resorts
Senior unsecured notes to Ba3 from Ba2
Mandalay Resort Group to Ba3 from Ba2
Senior unsecured notes to Ba3 from Ba2
Senior subordinated notes to B2 from B1
Provisional rating assigned and placed on review for possible
downgrade:
MGM MIRAGE
Senior secured guaranteed notes up to $1.0 billion at (P)Ba1
Headquartered in Las Vegas, Nevada, MGM MIRAGE owns and operates
17 properties located in Nevada, Mississippi and Michigan, and has
investments in three other properties in Nevada, New Jersey and
Illinois. MGM MIRAGE has a 50% interest in CityCenter Holdings,
Inc., a mixed-use project on the Las Vegas Strip and a 50%
interest in MGM Grand Macau, a hotel-casino resort in Macau S.A.R.
MODTECH HOLDINGS: Section 341(a) Meeting Set for December 2
-----------------------------------------------------------
The U.S. Trustee for Region 16 will convene a meeting of creditors
of Modtech Holdings Inc. on Dec. 2, 2008, at 2:30 p.m. at Room
100A, 3420 Twelfth St. in Riverside, California.
This is the first meeting of creditors required under Section
341(a) of the Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
Headquartered in Perris, California, Modtech Holdings Inc. --
http://www.modtech.com/-- makes and sells modular and
relocatable classrooms, commercial and light industrial modular
buildings. The company filed for Chapter 11 protection on
October 20, 2008 (Bankr. C.D. Calif. Case No. 08-24324). Marc J.
Winthrop, Esq., Winthrop Couchot Professional Corporation,
represents the Debtor in its restructuring efforts. When the
Debtor filed for protection from its creditors, it listed assets
and debts between $10 million and $50 million each.
MOVIDA COMMS: Wants Plan Filing Period Extended to November 26
--------------------------------------------------------------
Movida Communications Inc., nka KCMVNO Inc., ask the United States
Bankruptcy Court for the District of Delaware to further extend
the exclusive periods to:
a) file a Chapter 11 plan until Nov. 26, 2008, and
b) solicit acceptances of that plan until Jan. 26, 2008.
A hearing is set for Nov. 18, 2008, to consider approval of the
Debtor's motion. Objections, if any, are due Nov. 1, 2008.
The Debtor tells the Court that it has prepared a Chapter 11 plan
and a disclosure statement, which have been distributed for review
to the Debtor's board of directors and its professionals, and the
Official Committee of Unsecured Creditors, but unable to finalize
the plan and disclosure statement before the current plan filing
deadline.
Comments to the plan and disclosure statement have been received,
the Debtor says. Parties in interest is now finalizing and
reviewing the documents, the Debtor adds.
The Debtor's plan deadline expired on Oct. 27, 2008.
About Movida Communications
Headquartered in Kansas City, Missouri, Movida Communications Inc.
-- http://www.movidacellular.com/-- now known formally as KCMVNO
Inc., is a wireless service provider that offers pay-as-you-go
wireless voice and data communications services using a national
providers digital network. The company filed for Chapter 11
protection on March 31, 2008 (Bankr. D. Del. Case No. 08-10600).
Michael R. Nestor, Esq., at Young Conaway Stargatt & Taylor, in
Wilmington, Delaware, represents the Debtor. The U.S. Trustee for
Region 3 appointed creditors to serve on an Official Committee
of Unsecured Creditors. David W. Carickhoff, Jr., Esq., at Blank
Rome LLP represents the Committee. When the Debtor filed
for protection from its creditors, it listed asstes between
$10 million to $50 million and debts between $50 million to
$100 million. No trustee, examiner or official committee of
unsecured creditors has been appointed in this case.
NATIONAL LAMPOON: Inks Employment Deal with CFO Lorraine Evanoff
----------------------------------------------------------------
National Lampoon Inc. disclosed in a Securities and Exchange
Commission filing that on Oct. 28, 2008, it entered into an
employment agreement with Lorraine Evanoff, the company's chief
financial officer.
Pursuant to the employment agreement, Ms. Evanoff receives an
annual salary of $100,000 for services rendered to us as its chief
financial officer. Ms. Evanoff is entitled to participate in any
other benefits offered generally to its employees.
The employment agreement memorialized the grant of an option
agreement made to Ms. Evanoff on Dec. 17, 2007. Pursuant to this
grant, Ms. Evanoff may purchase 150,000 shares of its common stock
at an exercise price of $2.30. The right to purchase 50,000
shares vested on Dec. 17, 2007. The right to purchase the
remaining 100,000 shares will vest over the 36 month period
following that date. Pursuant to the employment agreement, Ms.
Evanoff will receive an option to purchase 100,000 shares of its
common stock on January 31st of each year, so long as her
employment with us continues. The exercise price for the options
will be equal to or greater than the closing price of the common
stock on the date of grant. The term of each option will be 10
years.
Finally, pursuant to the employment agreement, Ms. Evanoff will
receive an option to purchase 100,000 shares of the company's
common stock on the date that the American Stock Exchange notifies
us that it has regained compliance with Section 1003(a)(iv) of the
AMEX Company Guide, as required by the letter the company received
on Feb. 27, 2008 from the American Stock Exchange. All of the
options were granted in accordance with the National Lampoon, Inc.
Amended and Restated 1999 Stock Option, Deferred Stock and
Restricted Stock Plan.
Ms. Evanoff's employment agreement may be terminated by us for
cause or without cause. The employment agreement will terminate
upon Ms. Evanoff's death or disability. Ms. Evanoff may terminate
the agreement by giving us at least 30 days notice prior to her
termination. If the agreement is terminated without cause, in
addition to any benefits mandated by law, the company will pay to
Ms. Evanoff the following termination benefits: (i) all
compensation earned through the date of termination plus one
month's salary; (ii) all accrued but unused vacation benefits;
(iii) all unvested options will immediately vest, and (iv) Ms.
Evanoff will have the right to exercise all options for a period
of 90 days following the termination date.
The employment agreement provides indemnification to Ms. Evanoff
to the fullest extent authorized or permitted by law from and
against all expenses, judgments, penalties, fines and amounts paid
in settlement actually and reasonably incurred by her or on her
behalf in connection with any proceeding or any claim, issue or
matter if she acted in good faith and in a manner she reasonably
believed to be in or not opposed to the company's best interests
and, with respect to any criminal proceeding, she had no
reasonable cause to believe her conduct was unlawful. The
employment agreement also requires us to enter into a separate
indemnity agreement with Ms. Evanoff.
About National Lampoon
Based in West Hollywood, California, National Lampoon Inc.
(AMEX: NLN) -- http://www.nationallampoon.com/-- is active in a
broad array of media and entertainment segments. These include
feature films, television programming, online and interactive
entertainment, home video, audio, and book publishing. The
company also owns interests in all major National Lampoon
properties, including National Lampoon's Animal House, the
National Lampoon Vacation series and National Lampoon's Van
Wilder.
Going Concern Doubt
Weinberg & company P.A., in Los Angeles, expressed substantial
doubt about National Lampoon Inc.'s ability to continue as a going
concern after auditing the company's consolidated financial
statements for the year ended July 31, 2007. The auditing firm
pointed to the company's working capital deficiency of $7,196,255
and accumulated deficit of $41,257,284 as of July 31, 2007, and a
net loss of $2,504,170 for the year ended July 31, 2007.
The company had a net loss of $1,918,546 for the nine months ended
April 30, 2008. The company also had a negative working capital
of $7,467,403 and shareholders' deficiency of $3,750,368 at
April 30, 2008.
NELNET INC: Moody's Cuts Rating to Ba1; On Review
-------------------------------------------------
Moody's Investors Service downgraded the ratings of Nelnet, Inc.
(senior unsecured to Ba1 from Baa2) and placed the ratings on
review for possible further downgrade.
The downgrade reflects Moody's view that Nelnet's financial
flexibility has become constrained. The sharp deterioration of the
capital markets has resulted in a dramatic widening of credit
spreads for virtually every form of securitized product, including
the government guaranteed FFELP student loans financed in Nelnet's
core warehouse facility. This facility is subject to monthly mark
to market calculations, and the associated margin calls on the
company can be substantial.
To date, Nelnet has funded margin calls with draws on its $750
million unsecured revolving credit facility and unrestricted cash
balances. However, the firm now has little remaining capacity
under its revolver, which presently has an outstanding balance of
$691.5 million, while cash balances of $80 million provide only
modest cushion. Nelnet's exposure to market risk could result in
additional margin calls that further deplete the firm's cash
resources.
"We are concerned that, given the distressed state of the capital
markets and the elevated balance of the company's unsecured
revolving credit facility, the company may not be able to generate
sufficient cash flow to repay unsecured debt, absent significant
refinancing and/or external capital raising actions," said Moody's
senior analyst Curt Beaudouin.
During its review of Nelnet's ratings, Moody's will focus on the
company's near-term strategy for addressing its liquidity and
funding challenges, including plans to repay unsecured revolver
outstandings and unsecured notes from operating cash flow and
potentially other capital raising actions. Additionally, Moody's
will consider how the firm's strategies could affect its financial
and operational profile over the medium to long term.
Nelnet (ticker symbol NNI), a leading education financial services
company based in Lincoln, Nebraska, reported total assets of $28.4
billion as of June 30, 2008.
NORTH OAKLAND MEDICAL: Sale to Physicians Medical Fails; Closes
---------------------------------------------------------------
Catherine Jun at The Detroit News reports that North Oakland
Medical Center has been shut down, after efforts to sell the
hospital failed.
As reported in the Troubled Company Reporter on Sept. 4, 2008,
NOMC was to be sold to Oakland Physicians Medical Center LLC,
which would have operated the company as Oakland's first for-
profit hospital. NOMC filed for Chapter 11 bankruptcy
reorganization on Aug. 26, 2008, in the U.S. Bankruptcy Court in
Detroit, a move that was necessary to proceed with the sale. NOMC
said in the court filing,
The Detroit News relates that hospital officials said that Oakland
Physicians failed to get a loan due to the credit crisis. Citing
NOMC's chief financial officer Mike DeRubeis, The Detroit News
states that the Physicians Medical sought more than $4 million in
loans and was offered interest rates as high 20%, which the
hospital couldn't accept.
According to The Detroit News, about 800 medical staffers would be
laid off.
About NOMC
Headquartered in in Pontiac, Michigan, North Oakland Medical
Centers (NOMC) -- http://www.nomc.org/-- f.k.a. Pontiac General
Hospital, is a non-profit community hospital. It is licensed for
366 beds and it offers: Acute Medical Surgery, Physical Medicine
and Rehabilitation, Intensive Pediatric Physical Therapy,
Radiation Oncology, Emergency Centers (Pontiac and Waterford),
several out-patient clinics, and Community Services.
NORTHWEST AIRLINES: Delta Files Amendment to Compensation Plan
--------------------------------------------------------------
Northwest Airlines Corporation disclosed that Delta Air Lines,
Inc. filed with the Securities and Exchange Commission on
Oct. 29, 2008, the first amendment to its 2007 Performance
Compensation Plan, which is effective upon the completion of the
merger with Northwest Airlines.
In particular, the SEC filing relates to the registration of
130,000,000 shares of Delta's common stock, par value $0.0001 per
share that may be issued in connection with awards granted under
Delta's Compensation Plan.
According to Edward H. Bastian, Delta's president and chief
financial officer, Section 5(a) of the Delta 2007 Performance
Compensation Plan, which reflects the available Delta shares, will
provide that subject to certain adjustments, the maximum number of
Shares available for distribution under the Plan will not exceed:
(i) 30,000,000 Shares, plus
(ii) the number of Shares equal to 15% of the outstanding
equity capitalization of Delta, determined on a
"fully-diluted basis" at the Effective Time of the Merger,
of which at least 50% will be reserved for awards to non-
officer employees of Delta and Northwest.
"Fully-diluted basis" takes into account the maximum number of
Shares -- issued or issuable in respect of obligations outstanding
at the Effective Time and subject to Awards -- that the Company
has announced it intends to make or has agreed it will make in
connection with the consummation of the Merger, including awards
to non-pilot and management employees of Delta and NWA, which are
issuable pursuant Delta and NWA's Plans of Reorganization.
The Shares will be calculated based on the "treasury stock method"
of calculating diluted earnings per share under Statement of
Financial Accounting Standards No. 128, which took effect on
April 14, 2008.
Kenneth F. Khoury, executive vice president and general counsel of
Delta, affirms that upon the issuance of the Shares as provided in
the Compensation Plan, the Shares will be duly authorized, validly
issued and fully paid, and non-assessable.
A full-text copy of the Amended 2007 Compensation Plan on Form S-
8 is available for free at http://ResearchArchives.com/t/s?346d
About Delta Air
Based in Atlanta, Georgia, Delta Air Lines Inc. (NYSE: DAL) --
http://www.delta.com/-- is the world's second-largest airline in
terms of passengers carried and the leading U.S. carrier across
the Atlantic, offering daily flights to 328 destinations in 56
countries on Delta, Song, Delta Shuttle, the Delta Connection
carriers and its worldwide partners. Delta flies to Argentina,
Australia and the United Kingdom, among others.
The company and 18 affiliates filed for chapter 11 protection on
Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall
S. Huebner, Esq., at Davis Polk & Wardwell, represents the Debtors
in their restructuring efforts. Timothy R. Coleman at The
Blackstone Group L.P. provides the Debtors with financial advice.
Daniel H. Golden, Esq., and Lisa G. Beckerman, Esq., at Akin Gump
Strauss Hauer & Feld LLP, provide the Official Committee of
Unsecured Creditors with legal advice. John McKenna, Jr., at
Houlihan Lokey Howard & Zukin Capital and James S. Feltman at
Mesirow Financial Consulting, LLC, serve as the Committee's
financial advisors.
The Debtors filed a chapter 11 plan of reorganization and
disclosure statement explaining that plan on Dec. 19, 2007.
On Jan. 19, 2007, they filed revisions to the plan and disclosure
statement, and submitted further revisions to the plan on Feb. 2,
2007. On Feb. 7, 2007, the Court approved the Debtors' disclosure
statement. In April 25, 2007, the Court confirmed the Debtors'
plan. That plan became effective on April 30, 2007. The Court
entered a final decree closing 17 cases on Sept. 26, 2007.
* * *
As reported in the Troubled Company Reporter on July 29, 2008,
Standard & Poor's Ratings Services lowered its ratings on
Northwest Airlines Corp. and subsidiary Northwest Airlines Inc.
(both rated B/Negative/--), including lowering the long-term
corporate credit ratings on both entities to 'B' from 'B+', and
removed the ratings from CreditWatch, where they had been placed
with negative implications April 15, 2008. The outlook is
negative.
The downgrade reflects expected losses and reduced or negative
operating cash flow caused by high fuel prices. S&P also lowered
our ratings on enhanced equipment trust certificates, in some
cases by more than one notch.
About Northwest Airlines
Northwest Airlines Corp. (NYSE: NWA) -- http://www.nwa.com/-- is
the world's fourth largest airline with hubs at Detroit,
Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and about
1,400 daily departures. Northwest is a member of SkyTeam, an
airline alliance that offers customers one of the world's most
extensive global networks. Northwest and its travel partners
serve more than 1000 cities in excess of 160 countries on six
continents. Northwest and its travel partners serve more than
1000 cities in excess of 160 countries on six continents,
including Italy, Spain, Japan, China, Venezuela and Argentina.
The company and 12 affiliates filed for chapter 11 protection on
Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). Bruce
R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at Cadwalader,
Wickersham & Taft LLP in New York, and Mark C. Ellenberg, Esq.,
at Cadwalader, Wickersham & Taft LLP in Washington, represent the
Debtors in their restructuring efforts. The Official Committee
of Unsecured Creditors has retained Scott L. Hazan, Esq., at
Otterbourg, Steindler, Houston & Rosen, P.C. as its bankruptcy
counsel in the Debtors' chapter 11 cases. When the Debtors filed
for bankruptcy, they listed $14.4 billion in total assets and
$17.9 billion in total debts. On Jan. 12, 2007, the Debtors filed
with the Court their chapter 11 plan. On Feb. 15, 2007, the
Debtors filed an amended plan and disclosure statement. The Court
approved the adequacy of the Debtors' amended disclosure statement
on March 26, 2007. On May 21, 2007, the Court confirmed the
Debtors' amended plan. That amended plan took effect May 31,
2007.
(Northwest Airlines Bankruptcy News; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).
OFFICE DEPOT: Moody's Reviews Low-B Rating for Possible Downgrade
-----------------------------------------------------------------
Moody's Investors Service placed Office Depot, Inc.'s Ba1
corporate family rating, Ba1 probability of default rating, and
Ba2 senior note rating, on review for possible downgrade. The
review is in response to continued softness in the company's
operating performance through the third quarter of 2008. Office
Depot's SGL-3 speculative grade liquidity rating was affirmed.
Office Depot recently announced that its third quarter revenues
were down 7% from 2007, and operating profit for that same period,
about $53 million, is roughly 30% of the 2007 level. "The
California and Florida markets, in which Office Depot has a
disproportionate share of its revenues, continue to struggle from
a macroeconomic perspective, particularly housing and its related
segments, which are key small business markets for Office Depot.
Additionally, visibility with respect to the timing of a potential
rebound in these two critical states is limited," commented
Moody's Senior Analyst Charlie O'Shea. Moody's review will focus
primarily on Office Depot's fourth quarter operating performance.
A failure to stem the decline in operating results during the
current quarter would likely lead to a downgrade.
The affirmation of Office Depot's SGL-3 speculative grade
liquidity rating considers that despite revenue and profit
declines, liquidity remains adequate. The company recently
obtained a $1.25 billion asset-based revolving credit facility.
Office Depot, Inc., based in Delray Beach Florida, is the second
largest retailer of office supplies, with LTM September 2008
revenues of $15.1 billion and 1,275 retail locations in North
America.
OPPENHEIMER HOLDINGS: Moody's Reviews CFR at B1 for Downgrade
-------------------------------------------------------------
Moody's Investors Service placed on review for a possible
downgrade the B1 corporate family rating of Oppenheimer Holdings,
Inc. and E.A. Viner International Co., Oppenheimer's US
subsidiary.
According to Moody's, the principal reasons for the rating action
include the challenging revenue prospects for Oppenheimer's main
business lines, and the strong possibility that it will not be
able to meet the maximum leverage covenant contained in its
senior, secured credit note documentation at the end of 4Q08.
During the review, Moody's will focus on whether Oppenheimer is
able to reach an agreement with its lenders to avoid the
accelerated repayment of its $62 million senior secured credit
facility in the event that its leverage covenant is breeched.
Should Oppenheimer not be able to receive a covenant waiver from
the lenders and, as a result, enter technical default, its ratings
are likely to be downgraded.
As Moody's has previously noted, the economic slowdown in the US,
and the uncertain outlook in the equity markets, are pressuring
the inflows and performance of client assets, and, as a
consequence, transaction and incentive fees, in Oppenheimer's
private client business. Similarly, the current credit crisis and
elevated credit spreads are limiting the amount of investment
banking deal flow in Oppenheimer's core niches -- a trend unlikely
to reverse in the very short-term.
Expense flexibility will be critical to maintaining some level of
profitability during this period of cyclical weakness. In
considering the outcome of the rating review, Moody's will analyze
Oppenheimer's ability to restore operating profitability going
forward. Specifically, sustaining a Debt/EBITDA ratio of 5x or
below will be an important benchmark in this analysis.
These ratings were placed on review for a possible downgrade:
Oppenheimer Holdings, Inc.:
Corporate Family Rating -- B1
E.A. Viner International Co.:
$62 million seven year bank facility -- B1
Oppenheimer Holdings, Inc. is a Canadian holding company that
operates a regulated U.S. broker-dealer and reported net loss of
$17 million in the first nine months of 2008.
PAPER INT'L: Seeks to Employ Kurtzman Carson as Claims Agent
------------------------------------------------------------
Paper International, Inc., and its affiliate, Fiber Management of
Texas, Inc., ask the permission of the U.S. Bankruptcy Court for
the Southern District of New York to employ Kurtzman Carson
Consultants LLC as claims and noticing agent.
The Firm will, among other things, assist the Debtors in the
fiilng of their schedules of assets and liabilities and statement
of financial affairs, and prepare and serve required notices in
the Debtors' Chapter 11 cases.
The Debtors tell the Court that the hundreds of creditors and
other parties in interest involved in the Debtors' Chapter 11
cases may impose heavy administrative burdens upon the Court and
the Office of the Clerk of this Court. To relieve the Court and
the Clerk's Office of these burdens, the Debtors propose to
appoint the Firm as a claims and noticing agent.
The Debtors believe that the Firm's assistance will expedite
service of notices, streamline the claims administration process
and permit the Debtors to focus efficiently on their Chapter 11
strategy.
Because of the size of the Debtors' Chapter 11 cases, the number
of creditors and parties in interest and the Firm's experience,
the Debtors believe that the appointment of the Firm as the Claims
Agent is appropriate and in the best interest of the Debtors'
estates.
The Debtors do not believe that the Firm, as an administrative
agent and adjunct to the Court, is a "professional" whose
retention is subject to approval under Section 327 of Title 11 of
the United States Bankruptcy Code, or whose compensation is
subject to approval of the Court under Sections 330 and 331 of the
Code. The Firm nonetheless conducted a disinterestedness review.
Sheryl Betancethe Director of Restructuring Services for Kurtzman
Carson, assures the Court of the Firm's disinterestedness.
The Firm won't consider itself employed by the U.S. government and
that it won't seek any compensation from the government in its
capacity as the Claims Agent.
Before filing for bankruptcy, the Debtors paid to the Firm a
$30,000 retainer. Under the Firm and the Debtors' Service
Agreement, the Firm will charge the Debtors for services,
expenses, and supplies at rates or prices set by the Firm and in
effect, on the dat that the services and supplies are provided to
the Debtors. The Debtors will pay the Firm fees related to
transportation, lodging, meals, publications, printing, postage,
and other thrid-party charges, in addition to the hourly
consulting fees. Court documents didn't reveal the Firm's hourly
consulting fees.
About Paper International
Headquartered in Prewitt, New Mexico, Paper International, Inc.
-- http://www.internationalpaper.com-- manufactures paper and
packaging products with operations in North America, Europe, Latin
America, Russia and North Africa. The Debtors have more than
50,000 employees in in 20 countries. The company and Fiber
Management of Texas, Inc. filed for Chapter 11 protection on Oct.
6, 2008 (Bankr. S.D. N.Y. Lead Case No.08-13917). Larren M.
Nashelsky, Esq., at Morrison & Foerster LLP, represents the
Debtors. The Debtor selected Meade Monger as their chief
restructuring officer. The Debtors also selected AP Services,
LLC, as their restructuring advisor.
Corporacion Durango, S.A.B. de C.V. of Durango, Mexico, owns
100% of the Debtors' interests as of October 6, 2008. Corporacion
Durango filed a voluntary Chapter 15 petition in the United States
Bankruptcy Court for the District of New York, Case No. 08-13911.
Paper International listed assets between US$100 million and
US$500 million, and debts between US$500 million to
US$1 billion, while Fiber Management listed assets between
US$1 million to US$10 million and debts between US$500 million and
US$1 billion.
PEOPLE AGAINST DRUGS: Seeks to Employ Pronske as Bankr. Counsel
---------------------------------------------------------------
People Against Drugs Affordable Public Housing Agency seeks the
U.S. Bankruptcy Court for the Northern District of Texas'
permission to employ Pronske & Patel, P.C., as bankruptcy counsel.
The Firm will, among other things, take all necessary action to
protect and preserve the Debtor's estate, including the
prosecution of actions on behalf of the Debtor, the defense of any
actions commenced against the Debtor, negotiations concerning
litigation in which the Debtor is involved, and objections to
claims filed against the Debtor's estate.
The Firm will charge the Debtor these hourly rates:
Professional Rate
------------ ----
Gerrit M. Pronske $500
Rakhee V. Patel $300
Christina W. Stephenson $160
Legal Assistants $130
Gerrit M. Pronske, a shareholder with the Firm, assures the Court
of the Firm's disinterestedness, and that the Firm doesn't hold
any interest materially adverse to the interest of the Debtor's
estate or to any class of creditors or equoty security holders.
A hearing on the employment of the Firm is set for
Nov. 3, 2008, at 1:30 p.m.
Garland, Texas-based People Against Drugs Affordable Public
Housing Agency -- http://www.peopleagainstdrugs.org/-- was a
nonprofit founded in 1991 to help schools and police highlight the
dangers of drug abuse and to offer "gang-and-drug free living
environments," the report quotes what Texas state officials said
in a statement in June.
The company filed for Chapter 11 protection on Sept. 17, 2008
(Bankr. N. D. Tex. Case No. 08-34696). Gerrit M. Pronske, Esq.,
at Pronske & Patel, P.C., represents the company in its
restructuring effort. The company listed assets of $10 million to
$50 million and debts of $10 million to $50 million.
PEOPLE AGAINST DRUGS: Wants Pace Realty as Property Manager
-----------------------------------------------------------
People Against Drugs Affordable Public Housing Agency asks the
U.S. Bankruptcy Court for the Northern District of Texas'
permission to employ Pace Realty Corporation as property manager
for the Debtor's Country Creek Apartments.
The Firm will manage the Country Creek Apartments. The Debtor
tells the Court that the continued management of the Country Creek
Apartments is necessary during the bankruptcy and ultimately the
reorganization. A significant proportion of Debtor's income is
derived from the rents at the Country Creek Apartments. The
Firm's employment will allow the Debtor to execute its duties as
debtor and debtor-in-possession.
In addition to the fees earned under the Management Agreement, the
Debtor has agreed to pay the Firm a consulting fee of $7,500 for
the additional services to be performed while the Debtor is in
bankruptcy, including but not limited to preparing budgets,
prorating expenses, and assisting the Debtor's counsel with
information related to the Country Creek Apartments and its
operations.
The Debtor assures the Court of the Firm's disinterestedness, and
that the Firm doesn't have or hold any interest adverse to the
Debtor, its creditors, or any other party in interest.
A hearing on the employment of the Firm is set for
Nov. 3, 2008, at 1:30 p.m.
Garland, Texas-based People Against Drugs Affordable Public
Housing Agency -- http://www.peopleagainstdrugs.org/-- was a
nonprofit founded in 1991 to help schools and police highlight the
dangers of drug abuse and to offer "gang-and-drug free living
environments," the report quotes what Texas state officials said
in a statement in June.
The company filed for Chapter 11 protection on Sept. 17, 2008
(Bankr. N. D. Tex. Case No. 08-34696). Gerrit M. Pronske, Esq.,
at Pronske & Patel, P.C., represents the company in its
restructuring effort. The company listed assets of $10 million to
$50 million and debts of $10 million to $50 million.
PHARMANET DEVELOPMENT: Moody's Reviews Ratings for Downgrade
------------------------------------------------------------
Moody's Investors Service placed the ratings of PharmaNet
Development Group, Inc., under review for possible downgrade. The
rating review for possible downgrade reflects Moody's increased
uncertainty surrounding the company's ability to favorably
refinance its $144 million 2.25% Convertible Senior notes (not
rated by Moody's), which are putable at the holder's option on
August 15, 2009. The increased uncertainty stems both from the
difficult credit conditions in the broader market as well as
operating issues that PharmaNet has experienced through the third
quarter of 2008.
In addition to unusually high contract cancellations in its late-
stage business in late 2007 and early 2008, PharmaNet reported an
incremental $62 million of late stage cancellations in the third
quarter of 2008. Further, the company has reported some softness
in new business awards and higher cancellations in the early stage
business in the second half of 2008. These cancellations,
particularly in the late stage business, have had a significant
negative impact on the company's operations and cash flow.
However, despite the impact of the contract cancellations,
financial metrics as of September 30, 2008, remain in-line with
the current B3 Corporate Family Rating.
Resolution of Moody's rating review will be largely driven by
PharmaNet's ability to evidence committed financing or a clear
path to addressing its convertible notes. Secondarily, Moody's
will be focused on the fundamental drivers of the business and
whether contract cancellations and new business bookings appear to
have stabilized. Barring an exogenous event, if these two
conditions are met Moody's could confirm the ratings. If one or
both of these conditions are not met, it could result in a one or
more notch downgrade of the ratings.
PharmaNet's $45 million revolver has a maturity date of
December 22, 2009. However, if the convertible notes are not
refinanced on or before February 1, 2009, the revolver becomes due
and is terminated on February 15, 2009. As of September 30, 2008,
the company has not utilized its revolver. Moody's last rating
action was August 18, 2008, when Moody's downgraded the
Speculative Grade Liquidity rating to SGL-4 from SGL-3.
Ratings placed under review for possible downgrade:
Corporate Family Rating, B3
Probability of Default Rating, B3
$45 million senior secured revolver due 2009, Ba3 (LGD1, 5%)
The company's Speculative Grade Liquidity rating remains unchanged
at SGL-4.
PharmaNet, based in Princeton, NJ, is a leading North American
Contract Research Organization ("CRO") firm that provides Phase I
through Phase IV clinical development services, bio-analytical
laboratory services, and specialized drug development services to
pharmaceutical, biotechnology and generic pharmaceutical
companies. PharmaNet generated direct revenues of approximately
$364 million for the 12 month period ended September 30, 2008.
PHYSICIANS MEDICAL: Taps Bradley Arant as Attorneys
---------------------------------------------------
Physicians Medical Center LLC asks the United States Bankruptcy
Court for the Northern District of Alabama for permission to
employ Bradley Arant Rose & White LLP as its attorneys.
The firm will:
a) give the Debtor legal advice with respect to its duties as
debtor-in-possession in the continued operation of its
business and management of its assets;
b) prepare, on behalf of the Debtor, necessary motions,
applications, answers, contracts, reports and other legal
documents;
c) perform any and all legal services on behalf of the Debtor
arising out of or connected with the bankruptcy proceedings;
d) perform other legal services for the Debtor including, but
not limited to, work arising out of labor, tax,
environmental, corporate, litigation and other matters
involving the Debtor;
e) advise and consult with the Debtor for the orderly transfer
of patients and the winding down of its business affairs,
including the preparation of all necessary schedules and
disclosure statements; and
f) perform all other legal services required by the Debtor in
connection with the Debtor's chapter 11 case.
The firm's professionals and their compensation rates are:
Designations Hourly Rates
------------ ------------
Partners $230-$515
Associates $155-$325
Legal Assistants $110-$180
To the best of the Debtor's knowledge, the firm does not hold any
interest adverse to the Debtor's estate and its creditors, and is
a "disinterested person" as defined in Section 101(14) of the
United States Bankruptcy Code.
About Physicians Medical
Based in Birmingham, Alabama, Physicians Medical Center, LLC,
formerly Carraway Methodist Medical Center, owns and operates a
617-bed acute care hospital which also serves as a training site
for residents in the University of Alabama School of Medicine's
anesthesiology program. The company filed for Chapter 11 relief
on Oct. 20, 2008 (Bankr. N.D. Ala. Case No. 08-0520). Christopher
L. Hawkins, Esq., and M. Leesa Booth, Esq., at Bradley Arant Rose
& White represent the Debtor in its restructuring efforts. The
Debtor listed assets of between $10 million and $50 million, and
debts of between $10 million and $50 million.
PHYSICIANS MEDICAL: Section 341(a) Meeting Set for November 18
--------------------------------------------------------------
The U.S. Trustee for the Northern District of Alabama will convene
a meeting of Physicians Medical Center, LLC's creditors on Nov.
18, 2008, at 1:30 p.m., at Room 127 Birmingham.
This is the first meeting of creditors required under Section
341(a) of the U.S. Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
Based in Birmingham, Alabama, Physicians Medical Center, LLC,
formerly Carraway Methodist Medical Center, owns and operates a
617-bed acute care hospital which also serves as a training site
for residents in the University of Alabama School of Medicine's
anesthesiology program. The company filed for Chapter 11 relief
on Oct. 20, 2008 (Bankr. N.D. Ala. Case No. 08-0520). Christopher
L. Hawkins, Esq., and M. Leesa Booth, Esq., at Bradley Arant Rose
& White represent the Debtor in its restructuring efforts. The
Debtor listed assets of between $10 million and $50 million, and
debts of between $10 million and $50 million.
The Debtors' 20 largest unsecured creditors are owed a total of
$4.3 million. The three biggest unsecured creditors are McKesson
Information Solutions, owed $649,397; Cardinal Health, owed
$536,609; and Balch & Bingham LLP, owed $426,384. The Debtor has
about $8 million in secured debt.
POMARE LTD: Section 341(a) Meeting Scheduled for November 7
-----------------------------------------------------------
The U.S. Trustee for the District of Hawaii will convene a meeting
of Pomare Ltd.'s creditors on Nov. 7, 2008, at 9:00 a.m., at the
U.S. Trustee Hearing Room, 1132 Bishop Street, Suite 606,
Honolulu, Hawaii 96813.
This is the first meeting of creditors required under Section
341(a) of the U.S. Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
Creditors must file proofs of claim by Feb. 5, 2009.
Based in Honolulu, Hawaii, Pomare Ltd. dba. Hilo Hattie, makes and
sells men's clothing. The company filed for Chapter 11 relief on
Oct. 2, 2008 (Bankr. D. Hawaii Case No. 08-01448). Chuck C. Choi,
Esq. and James A. Wagner, Esq., at Wagner Choi & Evers represent
the Debtor as counsel. When the Debtor filed for protection from
its creditors, it listed assets of $10 million to $50 million, and
debts of $10 million to $50 million.
PRESCIENT APPLIED: Posts $2.14MM Net Losses for Qtr Ended Sept. 30
------------------------------------------------------------------
Prescient Applied Intelligence, Inc. posted $2,144,553 in net
losses on $2,196,601 in net revenues for third quarter ended
Sept. 30, 2008, compared with $365,012 in net income on $2,442,968
in net revenues for same period ended Sept. 30, 2007.
The company posted $9,292,023 in net losses on $6,370,291 in net
revenues for third quarter ended Sept. 30, 2008, compared with
$913,823 in net income on $7,398,108 in net revenues for same
period ended Sept. 30, 2007.
Prescient Applied Intelligence, Inc.'s balance sheet as of
Sept. 30, 2008, showed $13,044,898 in total assets, $4,181,441 in
total liabilities, and $8,863,457 in shareholders' equity.
The company also had $117,358,049 in accumulated deficit.
Full-text copy of the company's third quarter results is available
free of charge at: http://researcharchives.com/t/s?3469
About Prescient
Based in West Chester, Pa., Prescient Applied Intelligence, Inc.
(OTCBB:PPID) -- http://www.prescient.com/-- provides supply chain
and advanced commerce solutions for retailers and suppliers.
Founded in 1985, Prescient's solutions capture information at the
point of sale, provide greater visibility into real-time demand
and turn data into actionable information across the entire supply
chain.
Going Concern Doubt
Amper, Politziner & Mattia P.C. expressed substantial doubt
Prescient's ability to continue as a going concern after it
audited the Company's financial statements for the years ended
Dec. 31, 2005. The auditing firm pointed to the Company's
recurring losses from operations and resulting dependence upon
access to additional external financing.
QUEST RESOURCE: Lender Waives Potential Covenant Non-Compliance
---------------------------------------------------------------
Quest Resource Corporation provided update on its loan
agreements, asset sales, and auditor engagement:
Amendment to Loan Agreement and Additional Commitment
On Oct. 24, 2008, QRCP entered an agreement with its lender to
amend its $33.5 million term loan with a maturity of July 11,
2010. Among other terms of the amendment, the lender agreed to
waive any potential non-compliance in prior periods that was a
direct or indirect consequence of the questionable transfer of
approximately $10 million of funds from the Quest entities to an
entity controlled by QRCP's former chief executive officer.
In addition, the lender agreed to an additional term loan
commitment of $6 million with a maturity date of Nov. 30, 2008.
QRCP has drawn $2 million of the additional term loan commitment
to fund capital expenditures and working capital.
Quest paid a 25 basis point amendment fee on the outstanding
balance of the existing term loan and a 50 basis point commitment
fee on the additional term loan. T he ability to borrow the
remaining $4 million is subject to certain additional
conditions, including entering into amendments to the credit
agreements for Quest Energy Partners, L.P. and Quest Midstream
Partners, L.P.
Also under the terms of the amendment, the interest rate for the
term loan was increased to a variable level that was recently set
at 13.5% while the variable rate for the additional term loan
commitment is currently 14.35%. The full amendment to the loan
agreement was filed with the Securities and Exchange Commission
on Oct. 30, 2008.
Asset Sale
QRCP also disclosed the sale of approximately 22,600 net
undeveloped acres and one well located primarily in Somerset
County, Pennsylvania to a private party for approximately
$6.8 million, subject to adjustment during a limited post-closing
title review period. QRCP invested approximately $2.8 million
to acquire the acreage and drill the well. Net proceeds from the
sale will be used to repay the $2 million drawn on the additional
term loan commitment and to accelerate required quarterly
principal payments on the $33.5 million term loan. Tudor,
Pickering, Holt & Co. Securities, Inc. acted as QRCP's advisor for
the asset sale.
QRCP continues to pursue various options in order to generate
additional funds for debt repayment, working capital, and new well
development. No assurance can be given that QRCP will be
successful in closing any additional transactions or that those
transactions will generate sufficient net proceeds to fund QRCP's
planned expenditures.
Engagement of New Auditor
Quest has engaged the independent registered public accounting
firm of UHY LLP to perform the audit for the fiscal year ended
Dec. 31, 2008. In conjunction with the audit, UHY will also
perform reviews of QRCP's unaudited quarterly financial
information for the quarters ended Sept. 30, 2008 and Dec. 31,
2008.
On Sept. 25, 2008, QRCP's former independent auditor informed the
company it would resign effective upon the earlier of the date of
the filing of QRCP's Form 10-Q for the period ended Sept. 30,
2008, or Nov. 10, 2008. In connection with the former auditor's
review of QRCP's financial statements as of and for the period
ended June 30, 2008, which were included in the company's
quarterly report on Form 10-Q for the quarter ended June 30, 2008,
as filed with the Securities and Exchange Commission, there were
no disagreements between QRCP and the former auditor on any matter
of accounting principles or practices, financial statement
disclosure, or engagement scope or procedure, which disagreements,
if not resolved to the former auditor's satisfaction, would have
caused it to make reference to the subject matter of the
disagreements in connection with its report, and there were no
reportable events as specified in Item 304(a)(1)(v) of Regulation
S-K.
Management Comment
David Lawler, president of QRCP said, "We believe our loan
amendment and asset sale have helped address our immediate
liquidity needs. We plan to complete additional transactions in
the near-term, which may include additional asset sales, joint
ventures, or farm-outs, that will further improve our working
capital position and provide funding for our development plans in
the Marcellus Shale play. I would like to publicly thank our
employees for their continued hard work and dedication to our
organization."
About Quest Resource Corporation
Based in Oklahoma City, Oklahoma, Quest Resource Corporation
(NASDAQ:QRCP) -- http://www.qrcp.net-- is engaged in the
exploration, development, production and transportation of natural
gas. The company operates in two segments: Gas and oil
production, and Natural gas pipelines, including transporting,
selling, gathering, treating and processing natural gas.
RED SHIELD: Sells All Assets to Red Shield Acquisition for $18.8MM
------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Maine approved the
sale of substantially all of the assets of Red Shield
Environmental LLC and its debtor-affiliate RSE Pulp & Chemical LLC
to Red Shield Acquisition Inc. for $18,875,000, free and clear of
all liens and encumbrances. Red Shield Acquisition's bid
superseded the $11.5MM offer of Whitebox Red Shield Inc.
At an auction of the Debtors' assets on Oct. 22, 2008, the Debtors
determined, in consultation with their Official Committee of
Unsecured Creditors and the U.S. Trustee for the District of
Maine, that Red Shield Acquisition submitted the highest and best
bid. Accordingly, the Debtors entered into the Asset Purchase
Agreement with Red Shield Acquisition.
A copy of the Asset Purchase Agreement is available for free at
http://researcharchives.com/t/s?3468
The APA was proposed, negotiated, and entered into by the parties
without collusion, in good faith, and from arm's length bargaining
positions.
Upon the terms and subject to the conditions of the APA, Red
Shield Acquisition will assume all liabilities and obligations of
the Debtors listed under the Leases and Assumed Contracts of the
APA, and will exclude all contracts under the Excluded Contracts
of the APA.
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 Case Nos. 08-10633 and 08-10634), blaming
increases in material and fuel costs.. 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.
RELIANT ENERGY: Merrill Lynch Extends Waiver until November 6
-------------------------------------------------------------
Reliant Energy Inc. disclosed that Merrill Lynch have agreed to
extend the waiver period from October 31 through November 6.
On Sept. 29, Reliant Energy had entered into a letter agreement
with Merrill Lynch to take steps to end the credit-enhanced retail
structure with Merrill Lynch. The letter agreement also waived
compliance with the minimum adjusted EBITDA covenant in the
$300 million retail working capital facility with Merrill Lynch
through Oct. 31.
Headquartered in Houston, Texas, Reliant Energy Inc. (NYSE: RRI) -
http://www.reliant.com/-- provides electricity and energy
services to retail and wholesale customers in the United States.
In Texas, the company provides service to nearly 1.9 million
retail electricity customers, including residential and small
business customers and commercial, industrial, governmental and
institutional customers. Reliant also serves commercial,
industrial, governmental and institutional customers in the PJM,
Pennsylvania, New Jersey and Maryland market.
The company is an independent power producers in the nation with
approximately 16,000 megawatts of power generation capacity across
the United States. These strategically located generating assets
utilize natural gas, fuel oil and coal.
* * *
As reported in the Troubled Company Reporter on Aug. 12, 2008,
Troubled Company Reporter on Oct. 8, 2008, Standard & Poor's
Ratings Services lowered its corporate credit rating on Reliant
Energy Inc. and its subsidiaries to 'B+' from 'BB-'. The outlook
is stable.
SIRIUS XM: To Exchange 65MM Shares for $19.5MM Convertible Notes
----------------------------------------------------------------
Sirius XM Radio Inc. disclosed in a Securities and Exchange
Commission filing that it has agreed to issue an aggregate of
65,193,000 shares of its common stock, par value $0.001 per share,
in exchange for $19,500,000 principal amount of its 2.5%
Convertible Notes due 2009 beneficially owned by institutional
holders.
It will not receive any cash proceeds as a result of the exchange
of its common stock for the 2.5% Notes, which notes will be
retired and canceled. Upon completion of this transaction it will
have issued an aggregate of 132,231,070 shares of common stock in
exchange for $50,000,000 aggregate principal amount of 2.5% Notes.
The company executed these transactions to reduce its debt and
interest cost, increase its equity, and improve its balance sheet.
It may engage in additional exchanges in respect of its
outstanding indebtedness if and as favorable opportunities arise.
The issuance of the shares of the common stock was made pursuant
to the exemption from the registration requirements of the
Securities Act of 1933, as amended, contained in Section 3(a)(9)
of the Act.
Headquartered in New York, Sirius XM Radio Inc. --
http://www.sirius.com/-- formerly Sirius Satellite Radio Inc., is
a satellite radio provider. The company offers over 130 channels
to its subscribers, 69 channels of 100% commercial-free music and
65 channels of sports, news, talk, entertainment, traffic, and
data content. Its primary source of revenue is subscription fees,
with most of its customers subscribing to SIRIUS on either an
annual, semi-annual, quarterly or monthly basis. The company
derives revenue from activation fees, the sale of advertising on
its non-music channels, and the direct sale of SIRIUS radios and
accessories. Various brands of SIRIUS radios are Best Buy,
Circuit City, Costco, Crutchfield, Sam's Club, Target and Wal-
Mart.
* * *
Standard & Poor's Ratings Services affirmed its corporate ratings
on Sirius XM Radio Inc. (CCC+) and XM Satellite Radio Holdings
Inc., which S&P analyzes on a consolidated basis for purposes of
the corporate credit rating, and removed them from CreditWatch
with developing implications, where S&P placed them on March 4,
2008. The issue-level ratings on debt at New York City-based
Sirius XM Radio Inc. and at Sirius' unrestricted subsidiaries, XM
Satellite Radio Holdings Inc. and XM Satellite Radio Inc., remain
on CreditWatch with developing implications until additional
information becomes available regarding the ultimate
capitalization and the effect of cost-saving plans and growth
initiatives on secured and unsecured recovery at Sirius and XM.
Upon S&P's examination of additional information, S&P could raise,
affirm, or lower the issue-level ratings. The outlook is
developing.
SIRVA INC: Transfers Operations to Indiana, Creates 240 New Jobs
----------------------------------------------------------------
SIRVA Inc., the parent company of Allied Van Lines and North
American Van Lines, will move the headquarters of its moving
services unit from Chicago, Illinois, to Fort Wayne, Indiana,
reports the Chicago Tribune.
According to the report, the Indiana Economic Development
Corporation had offered the company up to $2,400,000 in incentives
for the move. SIRVA further said it is investing more than
$16,000,000 in the Fort Wayne facility which will house the new
headquarters.
There will be an undetermined number of job losses in Illinois,
Christine Moore, the company spokeswoman, said, notes the Chicago
Tribune. Ms. Moore added that Sirva will start hiring for the
jobs in Indiana next year.
The Chicago Tribune said the move is expected to create 240 new
jobs in Indiana by 2011.
About Sirva Inc.
The company and 61 of its affiliates filed separate petitions for
Chapter 11 protection on Feb. 5, 2008 (Bankr. S.D.N.Y. Case No.
08-10433). Marc Kieselstein, Esq. at Kirkland & Ellis, L.L.P. is
representing the Debtor. When the Debtors filed for bankruptcy,
it reported total assets of US$924,457,299 and total debts of
US$1,232,566,813 for the quarter ended Sept. 30, 2007. The Court
confirmed the Debtor's First Amended Prepackaged Plan on May 7,
2008. The Debtors' First Amended Prepackaged Joint Plan of
Reorganization became effective on May 12, 2008.
(Sirva Inc. Bankruptcy News, Issue No. 20; Bankruptcy Creditors'
Services Inc. http://bankrupt.com/newsstand/or 215/945-7000).
SJ LAND LLC: Section 341(a) Meeting Scheduled for December 4
------------------------------------------------------------
The U.S. Trustee for Region 16 will convene a meeting of creditors
of SJ Land LLC on Dec. 4, 2008, at 2:30 p.m., at 100A, 3420
Twelfth St. in Riverside, California.
This is the first meeting of creditors required under Section
341(a) of the Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
Headquartered in San Jacinto, California, SJ Land LLC, files for
Chapter 11 protection on Oct. 20, 2008 (Bankr. C.D. Calif. Case
No. 08-24398). Robert E. Opera, Esq., at Winthrop Couchot
Professional Corporation, represents the Debtor in its
restructuring efforts. When the Debtor filed for protection from
its creditors, it listed assets and debts between $50 million to
$100 million each.
STEVE AND BARRY'S: Picks Clear Thinking to Assist Wind Down
-----------------------------------------------------------
Stone Barn Manhattan LLC, et al., fka Steve & Barry's Manhattan
LLC, appointed Clear Thinking Group LLC, a national advisory firm,
to assist in their wind down process.
Under the terms of the engagement Dorene Robotti, Clear Thinking
managing director, and the Clear Thinking Group team will manage
the Debtors' wind-down efforts, helping guide the Debtors to a
successful plan of liquidation.
Headquartered in Port Washington, New York, Steve and Barry's LLC
-- http://www.steveandbarrys.com/-- is a national casual apparel
retailer that offers high quality merchandise at low prices for
men, women and children. Founded in 1985, the company operates
276 anchor and junior anchor shopping center and mall-based
locations throughout the U.S. The discount clothing chain's
brands include the BITTEN(TM) collection, the first-ever apparel
line created by actress and global fashion icon Sarah Jessica
Parker, and the STARBURY(TM) collection of athletic and lifestyle
apparel and sneakers created with NBA (R) star Stephon Marbury.
Steve & Barry's LLC, and 63 affiliates filed separate voluntary
petitions under Chapter 11 on July 9, 2008 (Bankr. S.D. N.Y. Lead
Case No. 08-12579). Lori R. Fife, Esq., and Shai Waisman, Esq.,
at Weil, Gotshal & Manges, LLP, represent the Debtors in their
restructuring efforts.
Diana G. Adams, United States Trustee for Region 2, has appointed
seven members to the Official Committee of Unsecured Creditors in
the Debtors' Chapter 11 cases.
On Aug. 22, 2008, the Debtors obtained permission from the Court
to sell substantially all of their assets for $168 million to a
joint venture by Bay Harbour Management and York Capital, BHY S&B
Holdings, LLC. Under the terms of the purchase agreement,
majority of the Debtors' 276 stores will remain open.
Pursuant to the Purchase Agreement, the Court authorized 51
Debtors to change their corporate names. Lead Debtor Steve &
Barry's Manhattan LLC (Case No. 08-12579) has been changed to
Stone Barn Manhattan LLC. Parent company Steve & Barry's LLC
(Case No. 08-12615) is now known as Steel Bolt LLC.
When the Debtors filed for bankruptcy, they listed $693,492,000 in
total assets and $638,086,000 in total debts.
(Steve and Barry's Bankruptcy News, Issue No. 17; Bankruptcy
Creditors' Service, Inc., http://bankrupt.com/newsstand/or
215/945-7000).
THE PLANETS: Section 341(a) Meeting Scheduled for Nov. 5
------------------------------------------------------------
The U.S. Trustee for the Eastern District of Tennessee will
convene a meeting of The Planets, Inc.'s creditors on Nov. 5,
2008, at 10:00 a.m., at BK Meeting Room, First Floor Knoxville,
Tennessee.
This is the first meeting of creditors required under Section
341(a) of the U.S. Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
Creditors must file proofs of claim by Feb. 3, 2009.
Knoxville, Tennessee-based The Planets, Inc., filed for Chapter 11
protection on Oct. 8, 2008 (Bankr. E. D. Tenn. Case No. 08-34501).
Michael H. Fitzpatrick, Esq., represents the Debtor in its
restructuring effort. The company listed assets of $1 million to
$10 million and debts of $1 million to $10 million.
VALLEY CLUB HOMES: General Unsecured Claims Will Be Paid in Full
----------------------------------------------------------------
Valley Club Homes, LLC, submitted to the U.S. Bankruptcy Court for
the District of Idaho a disclosure statement explaining its plan
of reorganization. A continued hearing on the approval of the
disclosure statement is scheduled for Dec. 10, 2008, at 9:30 p.m.
in Pocatello, Idaho.
Implementation of the Plan
Obligations required to be satisfied in cash under the Plan on and
after the effective date will be satisfied from the proceeds of
the:
a. sale of the improved lots secured by DL Evans Bank, the
California National Bank and Mountain West Bank;
b. refinancing or obtaining equity for the remaining lots,
which includes a $15 million bridge loan to take out Cal
National Bank and pay the unsecured creditors in full or
raise an additional $6.3 million capital to pay the
unsecured creditors in full and to pay down the Cal National
Bank loan to $12 million and then to pay off the balance
over the term of the five year Plan; and a private plan
wherein the Debtor will borrow up to $2 million for the
funds required to
(i) assume contracts including Parcel J;
(ii) cure Cal Bank's pre-plan accrued contract interest; and
(iii) to pay Cal Bank all accruing interest during the term
of the Plan; and
c. sale of vacant lots with improvements.
Valley Club projects that within the second year after the
effective date, it will build four smaller 2,500 sq. ft. homes for
a reduced price of $1,895,000 which it believes reflects the
change in the market. Also, in the same time period, Valley Club
will construct two custom homes. Thus, Valley Club projects that
after a year, it will sell six to seven homes per year, which is
similar to 2006. Valley Club believes it can achieve the same in
the third, fourth and fifth year of the Plan.
Treatment of Claims
Class 1 and Class 2, which are priority claims, will receive cash
as full payment as soon practical on or after the effective date
or at the option of the Debtor, their underlying rights will
remain unaltered by the Plan. The Debtor will pay in the ordinary
course of business Class 1 and 2 claims representing a liability
incurred by the Valley Club in the ordinary course of business.
Secured Class 3 claims, which are governmental units' claims for
taxes and duties, will be paid in full with interest in four equal
annual payments. The first payment will be due six months after
the Plan's effective date.
Class 4 consisting of the Blaine County Treasurer's claim for
$94,216, will be paid in five annual payments starting on or
before Dec. 20, 2009.
D.L. Evans Bank's secured claims for $4,242,299 constitute Class
5. Pursuant to a stipulation approved by the Court before the
filing of the Plan, D.L. Evans may commence nonjudicial
foreclosure after February 2009. Before the completion of the
nonjudicial foreclosure, Valley Club may sell the improved lots
securing D.L. Evans claims to a third party for an amount which
will retire D.L. Evans' note in full or less if it is acceptable
to D.L. Evans. In the event D.L. Evans completes its nonjudicial
foreclosure then it will be required to bid an amount required by
the Idaho Code before it can assert any claim for a deficiency.
If D.L. Evans is entitled to a deficiency, then it will file an
unsecured claim within 90 days and be entitled to a distribution
for the amount under Class 8 of the Plan. D.L. Evans will retain
its lien in the D.L. Evans collateral in the respective lot until
paid in full.
Mountain West Bank's claim for $1,989,620 makes up Class 6 and
will be paid in full from the sale of the lot that secured the
claim. If the lot is not sold by Feb. 28, 2010, Mountain West may
commence nonjudicial foreclosure of the lot. Before the
completion of the nonjudicial foreclosure, Valley Club may sell
the lot to a third party for an amount which will retire Mountain
West's note secured by the particular lot in full or less if it is
acceptable to Mountain West. In the event Mountain West completes
its nonjudicial foreclosure then it will be required to bid an
amount required by the Idaho Code before it can assert any claim
for a deficiency. If Mountain West is entitled to a deficiency,
then it will file an unsecured claim within 90 days and be
entitled to a distribution for the amount under Class 8. Claim
No. 15 will be disallowed because the debt was assumed by a third
party when it bought the lot securing it.
Valley Club will transfer to Cal National Bank all its rights to
the two of the 32 lots securing Cal National Bank's secured claim
which consists Class 7. Valley Club will cure Cal Bank's claim
relating to the remaining 30 lots at the prepetition non-default
rate of interest which is prime rate plus 1%. Cal Bank will not
be entitled to default interest accruing either before the
effective date or after the effective date. Thereafter, Valley
Club will pay interest monthly to Cal Bank based on the
outstanding principal owed. On the thirty remaining vacant lots,
Valley Club Homes will develop the lots with homes as required by
its contract with Valley Club, Inc. by borrowing sums from a
lender willing to pay the cost of construction. Upon sale of the
developed lots, Valley Club Homes will pay Cal Bank, from
each closing, the sum of $580,000. Cal Bank will be required to
release its lien on the lot at closing once it receives $580,000
at closing. Cal Bank will receive principal reductions and
interest until paid in full. All allowed amounts of interest
principal costs and fees not paid in full will be due and payable
on the fifth anniversary of the effective date.
Class 8 consists of all of the unsecured claims against Valley
Club. Class 8 will be paid periodically once funds from property
sales are available until the creditors in the class are paid in
full. The Debtor will pay all Net Sales Proceeds to this class
from each sale of the improved vacant lots until this class is
paid 100% of their claims. In addition, this class will be paid
the balance of any proceeds received from sales proceeds paid to
Class 5 and Class 6. Valley Club will not pay the Class 8 claims
of Village Green HOA and Valley Club HOA because they are
executory contracts being assumed and paid under the Plan.
Class 9 claims, which consist of interest claims in Valley Club,
will be paid after all classes prior to it are paid in full.
A full-text copy of the Disclosure Statement describing the
Debtor's Plan of Reorganization is available for free at:
http://bankrupt.com/misc/ValleyClubHomes_DS.pdf
About Valley Club Homes
Headquartered in Ketchum, Idaho, Valley Club Homes LLC owns and
operates a membership sports and recreation club. The company
filed for Chapter 11 protection on April 29, 2008 (Bankr. D. Idaho
Case No. 08-40339). Joseph M. Meier, Esq., at Cosho Humphrey,
LLP, in Boise, Idaho, represents the Debtor as counsel. When the
Debtor filed for protection from its creditors, it listed total
assets of $32,435,402 and total liabilities of $24,179,659.
VERASUN ENERGY: Case Summary & 30 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: VeraSun Energy Corporation
110 N. Minnesota Avenue, Suite 300
Sioux Falls, SD 57104
Bankruptcy Case No.: 08-12606
Debtor-affiliates filing separate Chapter 11 petitions:
Entity Case No.
------ --------
VeraSun BioDiesel, LLC 08-12605
VeraSun Energy Corporation 08-12606
ASA Albion, LLC 08-12607
ASA Bloomingburg LLC 08-12608
ASA Linden, LLC 08-12609
ASA OpCo Holdings, LLC 08-12610
US Bio Marion LLC 08-12611
US BioEnergy Corporation 08-12612
VeraSun Albert City, LLC 08-12613
VeraSun Aurora Corporation 08-12614
VeraSun Central City, LLC 08-12615
VeraSun Charles City, LLC 08-12616
VeraSun Dyersville, LLC 08-12617
VeraSun Fort Dodge, LLC 08-12618
VeraSun Granite City, LLC 08-12619
VeraSun Hankinson, LLC 08-12620
VeraSun Hartley, LLC 08-12621
VeraSun Janesville, LLC 08-12622
VeraSun Litchfield, LLC 08-12623
VeraSun Marketing, LLC 08-12624
VeraSun Ord, LLC 08-12625
VeraSun Reynolds, LLC 08-12626
VeraSun Tilton, LLC 08-12627
VeraSun Welcome, LLC 08-12628
VeraSun Woodbury, LLC 08-12629
Type of Business: The Debtors produce and market ethanol
and distillers grains. The Debtors have
16
production facilities in eight states, of which
one is still under construction. The Debtors
are scheduled to have an annual production
capacity of approximately 1.64 billion gallons
of ethanol and more than 5 million tons of
distillers grains by the end of 2008. In
addition, the Debtors also market E85, a blend
of 85% ethanol and 15 percent gasoline for use
in Flexible Fuel Vehicles (FFVs), directly to
fuel retailers under the brand VE85(R).
See: http://www.verasun.com/--
Chapter 11 Petition Date: October 31, 2008
Court: District of Delaware
Judge: Brendad Linehan Shannon
Debtor's Counsel: Mark S. Chehi, Esq.
mark.chehi@skadden.com
Skadden,Arps,Slate,Meagher & Flom LLP
One Rodney Square, P.O. Box 636
Wilmington, DE 19899-0636
Tel: (302) 651-3000
Fax: (302) 651-3160
Restructuring Advisor: AlixPartners LLP
Investment Banker: Rothschild Inc.
Communication Agent: Sitrick & Company
Claims, Noticing and Balloting Agent: Kurtzman Carson Consultants
LLC
Total Assets: $3,452,985,000 as of June 30, 2008
Total Debts: $1,913,214,000 as of June 30, 2008
The Debtor's Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Wells Fargo Bank NA bond debt $447,445,000
Attn: Jim Boerjan
Sixth St. & Marquiette Ave.
Minneapolis, MN 55479
Fagen Inc. trade debt $16,596,958
Attn: Jennifer A. Johnson
501 West Hwy., 212
P.O. Box 159
Granite Falls, MN 56214
Fax: (320) 564-3278
Cargill AG Horizon trade debt $12,920,870
Attn: Mike Etzel
P.O. Box 9300
Minneapolis, MN 55440x
Fax: (952) 984-8715
Haas TCM Proceesing LLC trade debt $5,440,599
Attn: Thad Fortin
1646 Westchester Pike
Westchester, PA 19382
Fax: (610) 436-9076
Union Pacific Railroad trade debt $5,254,153
Attn: David Murawski
P.O. Box 50245
St. Louis, MO 63105
Crown Iron Works trade debt $2,760,900
Company
Attn: Ralph Romano
P.O. Box 1364
Minneapolis, MN 55440
Fax: (561) 639-8051
Norfolk Southern trade debt $2,507,668
Railroad
Attn: Bridget Baldwin
P.O. Box 532797
Atlanta, GA 30353
CSX Transportation trade debt $2,264,181
Attn: Wayne Flynn
500 Water Street, 15th Floor
Jacksonville, FF 32202
Fax: (904) 359-2459
The CitGroup/Capital trade debt $2,186,102
Finance Inc.
Attn: Jeff Lytle
P.O. Box 4339
Church St. Station
New York, NY 10261
ICM Inc. trade debt $2,139,630
Attn: Dave Vander
P.O. Box 397
Colwich, KS 67030
Fax: (316) 796-0570
Fremar LLC trade debt $2,068,301
Attn: Matt Ashton
P.O. Box 357
Marion, SD 57043
Fax: (605) 648-3943
Burlington Northern trade debt $2,027,515
and Santa Fe Rail Company
Attn: Todd Whitmore
3110 Solutions Center
Chicago, IL 60677
Fax: (817) 333-2377
Todd & Sargent, Inc. trade debt $1,981,086
Attn: Clint D. Stelle
2905 SE 5th Street
Amesa, IA 50010
Fax: (515) 232-0682
Conoco Phillips Company trade debt $1,914,591
Attn: Sigmun L. Cornelius
600 N. Diary Ashford Road
Houston, TX 77079
Fax: (281) 293-1440
Univar USA Inc. trade debt $1,799,424
Attn: Steve Nielson
P.O. Box 84027
Dallas, TX 75284
Fax: (214) 503-7903
Dakota AG Cooperative trade debt $1,704,621
Attn: Dennis Novacek
5324 165th Ave., SE
Kindred, ND 58051
Fax: (701) 428-3137
Trip Rail Leasing trade debt $1,694,206
Attn: Roger Wynkoop
P.O. Box 7777
Philadelphia, PA 19175
CN Railroad trade debt $1,592,289
Attn: Steve Gehrt
P.O. Box 71578
Chicago, IL 60694
Jans Corporation trade debt $1,537,131
Joel Christensen
300 N. Phillips Ave.
Suite 201
Sioux Falls, SD 57104
Fax: (605) 331-5821
Innovative AG Services trade debt $1,328,850
Attn: Jack Friedman
P.O. Box 96
Manchester, IA 52057
Novozymes North America trade debt $1,151,371
Inc.
Attn: Henrik Gurtler
P.O. Box 7247-7554
Philadelphia, PA 19170
K Sea Operating trade debt $900,278
Attn: Greg Haslinsky
One Tower Center Blvd., 17th
East Brunswick, NJ 08816
Fax: (732) 339-6140
A&B Process Systems trade debt $844,207
Attn: Alan Verploegh
201 S. Wisconsin Avenue
Stratford, WI 55484
Fax: (715) 687-3225
GE Railcar Services trade debt $834,054
Corporation
Attn: Jody Chisholm
P.O. Box 74699
Chicago, IL 60675
Fax: (312) 853-5422
Bowen Engineering trade debt $741,625
Corporation
Attn: Scot Evans
10315 Allisonville Road
Fishers, IN 46038
Fax: (317) 841-4257
Rognes Bros Excavating Inc. trade debt $702,601
Attn: Harvey Rognes
115 N. Mill Street
Lake Mills, IA 50450
Iowa Chicago & Eastern RR trade debt $684,141
Attn: John Brooks
Sioux Falls, SD 57101
Fax: (605) 782-1299
Canadian Pacific trade debt $661,759
Railway
Attn: Brent Dornian
P.O. Box CM-9527
St. Paul, MN 55170
Bosselman Energy Inc. trade debt $637,099
Attn Ron Golka
P.O. Box 1567
Grand Island, NE 68802
Fax: (308) 382-1160
Railworks Inc. trade debt $626,442
Attn: Michael Mermelstein
P.O. Box 915216
Waseca, TX 75391
VERASUN ENERGY: Files for Chapter 11 Bankruptcy in Delaware
-----------------------------------------------------------
VeraSun Energy Corporation together with 24 of its subsidiaries
filed voluntary petition for relief under chapter 11 of the U.S.
Bankruptcy Code in the United States Bankruptcy Court for the
District of Delaware to enhance liquidity while they reorganize.
The filing was precipitated by a series of events that led to a
contraction in VeraSun's liquidity, impairing its ability to
operate its business and invest in production facilities. The
company suffered significant losses in the third quarter of 2008
from a dramatic spike in its corn costs, reflecting in part costs
attributable to its corn procurement and hedging arrangements, and
historically unfavorable margins. Beginning in the third quarter,
worsening capital market conditions and a tightening of trade
credit resulted in severe constraints on the company's liquidity
Position.
Faced with these constraints, the company filed a chapter 11
petition to facilitate access to additional liquidity while it
reorganize to take better advantage of its position as one of the
nation's largest producers of ethanol.
The company listed $3,452,985,000 in total assets and
$1,913,214,000 in total debts as of June 30, 2008. The company
owes Wells Fargo Bank, NA, owing $447,445,000 in bond debt; Fagen
Inc. owing $16,596,958 in trade debt; Cargill AG Horizon owing
$12,920,870 in trade debt; and Haas TCM Proceeding LLC owing
$5,440,599 in trade debt.
Company Intends To Maintain Operations
During the chapter 11 proceedings, the company plans to resume
normal operations. The company has taken steps to ensure
continued supply of product to its customers and to fulfill all
customer obligations. In that regard, the company is working
closely with its lenders and expects to reach an agreement before
the "first-day" hearing on Monday for additional committed
financing to provide adequate liquidity to fund operations in the
normal course.
The company expects that it will not scale back its purchases of
raw materials, and corn and other suppliers will continue to be
paid in full for all goods and services furnished after the filing
date as required by the Bankruptcy Code. The company has also
sought authority from the bankruptcy court to pay for goods
delivered to the Company on or after Oct. 11, 2008.
The company has also requested the bankruptcy court's approval to
continue to pay employees in the ordinary course without
interruption, and expects the request to be granted as part of the
court's "first day" orders.
"Today's filing allows VeraSun to address its short-term liquidity
constraints as we navigate historically challenging market
conditions while we focus on restructuring to address the
company's long-term future," Don Endres CEO said. "We appreciate
the loyalty of our employees, customers and suppliers during this
challenging time."
Professionals On Board
The company selected Skadden, Arps, Slate, Meagher & Flom LLP as
its counsel. The company also selected AlixPartners LLP
represents as restructuring advisor, Rothschild Inc. as investment
banker; and Sitrick & Company as communication agent.
Kurtzman Carson Consultants LLC will serve as the company's
claims, noticing and balloting agent.
About VeraSun Energy
Headquartered in Sioux Falls, VeraSun Energy Corp. (NYSE: VSE)
S.D., -- http://www.verasun.com/-- produces and markets ethanol
and distillers grains. The company has 16 production facilities
in eight states, of which one is still under construction. The
company is scheduled to have an annual production capacity of
approximately 1.64 billion gallons of ethanol and more than 5
million tons of distillers grains by the end of 2008. In
addition, the company also markets E85, a blend of 85% ethanol
and 15 percent gasoline for use in Flexible Fuel Vehicles (FFVs),
directly to fuel retailers under the brand VE85(R).
VERIZON COMMS: Moody's Junks Rating on $2.3BB Alltel Notes
----------------------------------------------------------
Moody's Investors Service confirmed the A3 senior unsecured rating
of Verizon Communications (VZ) based on Moody's assessment that
the cash flows generated by Verizon Wireless (VZW) will continue
to grow at a healthy rate despite the U.S. economic downturn.
Moody's anticipates that, especially over the next two years, the
bulk of this cash will be directed to Verizon Communications as
VZW quickly repays an inter-company loan. The pending acquisition
of Alltel will increase leverage quite significantly. However, the
cash flows generated by Verizon Wireless, in combination with
Moody's expectation that future share repurchases will be limited,
should allow Verizon Communications to meet its various
obligations and investment needs and reduce debt.
"Cash flows from Verizon's wireless business have been strong, and
Moody's expects that to continue despite the soft economy," said
Dennis Saputo, Moody's Senior Vice President. "The strength of the
wireless business offers substantial support to the rating, and
helps offset challenges in some of the wireline subsidiaries."
Moody's also lowered the ratings of 4 wireline-operating companies
because Moody's expects their financial profiles to remain under
pressure as a result of intense competition, combined with the
high, albeit declining, costs of the FiOS project. In addition,
Moody's confirmed the ratings of 9 Verizon wireline subsidiaries
based on the expectation that the parent company will continue to
provide a level of support that enables the credit profiles at
these companies to remain close to current levels.
The outlook for Verizon and all its subsidiaries is negative. "The
negative outlook reflects execution risks associated with
Verizon's plan to reduce its leverage to a level that is
commensurate with the A3 rating following the Alltel acquisition
amid a weakening economy", commented Saputo. In addition, the
company faces very large financing needs related to the
acquisition during a period of difficult market conditions. The
parent company's existing $6 billion revolver matures in September
2009, the remaining financing for the Alltel acquisition
(estimated at about $21 billion) is uncommitted and a little over
$7 billion of debt matures in the next twelve months.
These actions complete the ratings review of Verizon and its
subsidiaries initiated on June 6, 2008 when Verizon announced that
its 55% owned subsidiary, Verizon Wireless, planned to acquire
Alltel for about $28.1 billion in cash and assumed debt. Moody's
is in the process of evaluating Verizon Wireless and will be
assigning a rating to the company shortly. The review of Alltel's
debt ratings, initiated at the same time, remains ongoing pending
greater assurance that the transaction will close as expected.
Further Rationale for Confirmation of Verizon Communications
Ratings
The confirmation of the parent company's A3 rating reflects
Moody's assessment that the free cash flows generated by Verizon
Wireless will continue to grow at a healthy pace, despite a
slowing economy, as the company benefits from economies of scale,
the high operating leverage inherent in its business model and
synergies resulting from its acquisition of Alltel.
Moody's believes that VZW's state-of-the-art network supports
excellent service quality, a strong brand reputation, and allows
the company to successfully introduce new and enhanced service
offerings, leading to above-average revenue growth and below-
average churn rates. These factors, when coupled with an efficient
cost structure are expected to lead to steadily improving earnings
and cash flows which will should allow Verizon Wireless to
steadily reduce the significant amount of debt incurred in the
acquisition of Alltel.
Moody's anticipates that, especially over the next two years, the
bulk of the excess cash flow generated by VZW will be upstreamed
to Verizon Communications, enabling the parent to meet it various
obligations (including common stock dividends, debt service and
taxes) and invest in its wireline operations without incurring
additional debt. The A3 rating anticipates that parent company
share repurchases will be limited until the consolidated entity
restores its balance sheet to targeted levels of about 1.8 times
Debt to EBITDA (Moody's adjusted for proportionate consolidation
of Verizon Wireless).
There are several challenges confronting Verizon Communications.
Although Moody's expects VZW's contribution to Verizon's
proportionate earnings and cash flow to continue increasing from
about 43%, a weakening economy may preclude the company from
reducing debt levels as quickly as initially expected. Wireless
subscriber growth is slowing as penetration increases toward 100%
(from about 85%) and competition remains fierce. Switching costs
are low and pricing power is limited. Finally, it is unclear
whether expanding data usage will continue to offset pricing
pressure on voice services and sustain recent wireless ARPU
growth, especially if the U.S. economy weakens more than expected
and if the downturn becomes protracted.
"On the wireline side, overall business risk is still increasing
with accelerating line losses and the shift in the company's asset
base and investment needs toward highly competitive and capital-
intensive business segments like video, broadband and corporate
data", Saputo added. The margins on these products are
significantly lower than the margins on traditional voice
services.
A reconfiguration of VZW's ownership structure is not factored
into the current ratings. A potential buyout of Vodafone's 45%
stake in VZW could have significant rating implications for the
ratings of VZ, its operating subsidiaries and VZW, depending on
how the takeout is financed.
Rationale for Ratings Actions on the Wireline Operating Companies
Verizon New York
"The rating of Verizon New York was confirmed at Baa3 because of
the significant amount of support that this subsidiary receives
from its parent company --- an indication of its strategic
importance to Verizon", according to Dennis Saputo. While Verizon
has not taken a dividend from VZ-NY for several years, in May 2007
Verizon reclassified $2.0B of VZ-New York's intercompany debt to
equity. In addition, access line losses appear to have moderated
(dropping from 10.8% in 2006 to 9.8% in 2007) and the company's
annual revenue decline has slowed to less than 5% for the first
time in four years.
Nevertheless, intense competition, a very high cost structure, a
difficult regulatory environment and a very weak balance sheet
make it unlikely that the company will be able to significantly
strengthen its credit metrics materially over the next few years.
Moody's expects that Verizon New York's free cash flow will remain
under considerable pressure for some time, given the likelihood
that access line losses will continue to drive lower revenues,
that much of the company's cost structure is fixed, and that it
faces the expense of a significant network upgrade in its largest
market, New York City. A relatively significantly under funded
pension obligation also puts pressure on the rating. Consequently,
Verizon New York is likely to remain the lowest rated of the
Verizon wireline subsidiaries for quite some time.
Verizon New England
Moody's downgraded the senior unsecured long-term debt rating of
Verizon New England, Inc. (VZ-NE) to Baa2 from Baa1 because
Moody's believes that the financial profile of VZ-NE will continue
to be negatively impacted by strong competition, a high cost
structure and the expenses associated with ongoing fiber
deployment (the project is expected to be completed in 2010).
Competitive inroads and the investment associated with the FiOS
network upgrade have had only a modest impact on VZ-NE's leverage
profile over the last few years because of the actions taken by
Verizon to support VZ-NE's balance sheet. Access lines and
revenues have declined about 8% and 2%, respectively in each of
the last two years and EBITDA margins have gone from over 38% in
2005 to just over 34% in 2007 (Moody's adjusted). Debt to EBITDA
increased to 3.0x over the same period.
Earlier this year Fairpoint Communications merged with Verizon
Maine, Verizon New Hampshire, and Verizon Vermont in a reverse
Morris Trust transaction. The transaction closed on March 31,
2008. In order to offset the loss of a portion of the earnings and
cash flows from these three states, a little over $500 million of
VZ-NE's debt was paid down and reduced through an internal
exchange. Nevertheless, Moody's believes that this transaction
will increase VZ-NE's Debt to EBITDA ratio by about 60 basis
points since the amount of debt reduction was only modestly higher
than the loss of EBITDA.
Verizon Pennsylvania, Verizon New Jersey, and Verizon Maryland
The ratings of Verizon New Jersey, Verizon Pennsylvania, and
Verizon Maryland were all lowered to Baa1 from A3 because Moody's
believes that competitive challenges in those states will remain
intense. Access line losses in all 3 states continued to increase
in 2007, margins at all three companies continue to steadily
decline and investment spending has increased materially in the
last couple of years. Moody's rating action incorporates its
belief that these companies are more likely to rely on parent
company support given their challenging competitive environments
and relatively significant investment needs. Consequently, their
leverage ratios are likely to remain among the highest in the
Verizon family.
Verizon Virginia
The senior unsecured debt rating of Verizon Virginia was confirmed
at Baa1 despite currently having one of the stronger balance
sheets and higher operating margins in the complex because Moody's
believes that cable competition in the company's service territory
will intensify materially in the near future. Therefore, Moody's
expects access line loss rates (which at 6.9% in 2007 were below
the rated Verizon operating company average of about 8.3%) to
increase quickly and lead to margin erosion and pressure on
operating cash flows. Capital spending has been above average over
the last few years (in part due to the region's high growth) and
Moody's expects it will remain elevated. Consequently, Moody's
believes that the company's leverage metrics will deteriorate
modestly from current levels. At 51.9% the company's EBITDA margin
was well above the average for the rated ILECs of 37.6% and Debt
to EBITDA at 1.7 times was below the rated ILEC average of 2.7
times (all ratios Moody's adjusted for the twelve months ended
June 30, 2008).
Verizon California, Verizon Delaware, Verizon North, Verizon
Northwest, and Verizon West Virginia
Moody's has confirmed the A3 senior unsecured ratings of Verizon
California, Verizon Delaware and Verizon Northwest as the rating
agency expects these companies to maintain their healthy cash
flows and moderate leverage over the rating horizon. Moody's
expects EBITDA margins for these three companies to remain strong
and the level of competition in their markets to remain stable in
the near-term, especially in Delaware and California, which
already face intense competition but where greater FiOS deployment
is expected to moderate subscriber losses to cable competition.
Moody's has also confirmed the A3 senior unsecured debt ratings of
Verizon West Virginia and Verizon North. While capital investment
has remained well below average at both these companies,
competitive challenges have also been slow to develop although
recent line losses at Verizon North indicate that competition is
accelerating in that region. However, EBITDA margins are over 60%
at Verizon North and its Debt to EBITDA ratio is 1.4 times, both
metrics the best of the Verizon operating companies. Consequently,
Moody's anticipates that the company will be able to sustain its
strong credit profile in the face of increasing competition.
While EBITDA margins are lower at Verizon West Virginia,
competition is expected to remain relatively subdued over the
near-term (access line losses were 7% in 2007) which should enable
the company to sustain a strong credit profile (Debt to EBITDA is
1.4 times).
GTE Southwest and Verizon Florida
The senior secured debt ratings of GTE Southwest and the senior
unsecured debt rating of Verizon Florida were confirmed at Baa1
because Moody's expects the operating performance of both
companies to stabilize in the near-term. Both companies were among
the first to modernize their networks by deploying fiber to homes.
While the rate of access line loss continued to increase during
2007 at Verizon Florida (in part, Moody's believes due to housing
problems), Moody's notes that the rate of decline slowed at GTE
Southwest for the second year in a row and revenue growth at that
company accelerated to over 3.5% in 2007.
Parent Support of Wireline Subsidiaries
For several years now, Verizon has taken steps to support the
credit profile of its operating telephone companies. During this
period, the wireline subs have not issued any external debt while
their individual funding needs have been provided via inter-
company loans from the parent. In addition, Verizon has taken
steps to keep the level of total debt at each of the individual
operating subs relatively flat, mainly by restricting and, in some
cases eliminating the amount of dividends that the subs upstream.
Nevertheless, average leverage ratios have increased steadily over
the last three years, mainly because of earnings pressures as high
margin legacy voice revenues are replaced by lower margin revenue
streams and high investment requirements.
Although Moody's continues to be concerned with the operating
performance of some of Verizon's wireline operating subsidiaries
and Moody's continues to have doubts about the ultimate return
prospects of the FiOS investment, Moody's recognizes that FiOS
costs are coming down, deployment is on schedule, the product is
meeting with good customer acceptance, and that thus far, the
products penetration appears to have an inverse relationship with
the number of line losses in some markets.
Most importantly, Moody's believes that Verizon's overall
financing policies of its wireline subsidiaries indicates
relatively strong parental support for these subsidiaries,
consequently, Moody's gives these subsidiaries, several notches of
rating lift from the ratings that would result from their
individual, stand-alone credit quality.
Moody's believes that at least over the next 12 to 18 months, the
financial profile of most Verizon operating telephone subsidiaries
will continue to be pressured by strong competition and the
expenses and capital requirements associated with ongoing fiber
deployment (the project is expected to be completed in 2010).
However, Moody's believes that significant previous network
investment and additional cost reduction initiatives should slowly
enable most of these companies to begin to stabilize their
operating performance. While Moody's expects that the earnings and
cash flow generating capacity of the group, as a whole, will
remain pressured through at least the middle of 2009, Moody's
believes that dividends to the parent will be limited such that
leverage metrics at these subsidiaries, as a group, stabilize at
about 3.0 times Debt to EBITDA, Moody's adjusted. For FYE 2007 and
LTM to June 30, 2008, the average Moody's adjusted Debt to EBITDA
ratio for Verizon's rated wireline operating subsidiaries was 2.7
times.
Complete list of rating actions:
Ratings confirmed are:
Verizon Communications: senior unsecured, A3
NYNEX Corporation: senior unsecured, A3
GTE Corporation: senior unsecured, Baa1
Verizon Delaware, Inc.: debentures, A3
Verizon West Virginia, Inc.: debentures, A3
Verizon North, Inc.: debentures, A3
Verizon Northwest, Inc.: debentures, A3
Verizon California, Inc.: debentures, A3
Verizon Virginia, Inc.: notes and debentures, Baa1
Verizon Florida, Inc.: debentures, Baa1
GTE Southwest, Inc.: first mortgage bonds, Baa1
Verizon New York, Inc.: notes and debentures, Baa3
Ratings downgraded are:
Verizon New England, Inc.: notes and debentures, to Baa2 from Baa1
Verizon New Jersey, Inc.: debentures, to Baa1 from A3
Verizon Pennsylvania, Inc.: debentures, to Baa1 from A3
Verizon Maryland, Inc.: debentures, to Baa1 from A3
Ratings remaining on review for possible upgrade:
Alltel Corporation:
$2.3 billion Senior Unsecured Notes -- Caa1, LGD 6 (95%)
$1.0 billion Senior Unsecured Toggle Notes -- Caa1 LGD 5 (79%)
Corporate Family Rating -- B2
Probability of Default Rating -- B2
Alltel Communications:
$14.0 billion Senior Secured Term Loan B due 2015 -- Ba3, LGD2
(27%)
$1.5 billion Senior Secured Revolving Credit Facility due 2013 -
Ba3, LGD2 (27%)
$7.7 billion Senior Unsecured Committed Bridge Facility -- Caa1,
LGD 5 (79%)
Headquartered in New York City, Verizon Communications Inc. is the
second largest telecommunications provider in the United States
delivering broadband and other wireline and wireless communication
services to residential, business, government and wholesale
customers. Verizon Wireless, headquartered in Basking Ridge, NJ is
a joint venture between Verizon Communications, which owns 55%,
and Vodafone, which owns the remainder.
Headquartered in Little Rock, Arkansas, ALLTEL Corporation
operates the nation's largest wireless network (by geography).
VISKASE COMPANIES: Moody's Affirms Caa1 CFR; Outlook Negative
-------------------------------------------------------------
Moody's Investors Service revised the outlook of Viskase
Companies, Inc. to negative and affirmed the Corporate Family
Rating of Caa1. Moody's also assigned instrument ratings to the
$8 million 11.5% senior secured note due 2011 which were exchanged
for the $8 million 8% subordinated notes due 2008 on June 2, 2008.
Moody's took these rating actions for Viskase Companies, Inc.:
Assigned $8 million 11.5% senior secured notes due 2011, Caa1 (LGD
4, 54%)
Downgraded $90 million 11.5% senior secured notes due 2011, to
Caa1 (LGD 4, 54%) from B3 (LGD 3, 37%)
Affirmed Corporate Family Rating, Caa1
Affirmed Probability of Default rating, Caa1
Affirmed Speculative Grade Liquidity Rating, SGL-4
The Caa1 Corporate Family Rating rating reflects the company's
cash losses, tight liquidity, absence of contracted business,
small revenue base, reliance on predominantly one product line
(60% sales), and significant competition. The rating is supported
by increasing demand globally for its products, a global presence,
and an established clientele. The rating is also supported by
acceptable Debt-to-EBITDA leverage, adequate EBIT-to-interest
coverage, and an acceptable EBIT margin for its rating category.
The company also benefits from a strong financial sponsor.
The downgrade of the 11.5% senior secured notes due 2011 reflects
the change in the capital structure over the last twelve months.
Over the last twelve months, the capital structure has changed to
primarily secured debt with little subordinated debt cushion
underneath as Viskase has completed the exchange of a portion of
its subordinated debt for senior secured debt, increased the size
of its revolver and will repay the remaining subordinated debt
completely by December 1, 2008. The increased secured debt and
elimination of subordinated debt cushion resulted in a downward
notching for the 11.5% senior secured notes due 2011under the LGD
methodology.
The negative outlook reflects the company's weak liquidity profile
and cash losses. As indicated by Viskase's recent exchange offer,
liquidity is tight and leaves almost no room for continued cash
losses. While operating results have begun to improve, Viskase
still generates insufficient cash flow to fund its capital
expenditures and ongoing required contributions for it underfunded
pension plan. The company also faces the maturity of the remaining
8% subordinated notes on December 1, 2008 which were not tendered
in the recent exchange offer. Viskase has indicated that it has a
binding commitment for a significant portion of the maturing
notes.
Headquartered in Darien, Illinois, Viskase Companies, Inc., is a
producer of cellulose, fibrous and plastic casings for hot dogs
and sausages, lunch meats, hams and other processed meat and
poultry products. Revenues for the twelve months ended June 30,
2008, were $271 million.
WENDY'S INTERNATIONAL: Moody's Cuts CFR to B1; Outlook Stable
-------------------------------------------------------------
Moody's Investors Service lowered the corporate family rating and
probability of default rating of Wendy's International, Inc. to B1
from Ba3. In addition, Moody's lowered the senior unsecured
ratings of Wendy's to B2 (LGD4, 63%) from Ba3 (LGD4, 54%). Moody's
also assigned a Ba1 rating to Wendy's proposed $200 million senior
secured revolving credit facility. The outlook is stable.
Ratings downgraded are:
-- Corporate family rating lowered to B1 from Ba3
-- Probability of default rating lowered to B1 from Ba3
-- Senior unsecured note ratings lowered to B2 (LGD4, 63%) from
Ba3 (LGD4, 54%)
Ratings assigned:
-- Proposed $200 million senior secured revolving credit
facility rated Ba1 (LGD1, 9%).
The outlook is stable.
The downgrade of Wendy's CFR to B1 from Ba3 reflects the company's
weaker than expected operating performance and debt protection
measures as a deteriorating consumer environment, cost inflation,
and competitive pressures continue to weigh heavily on earnings
and margins.
The downgrade of the senior unsecured notes to B2 from Ba3
reflects the downgrade of the company's CFR as well as the
introduction of the $200 million senior secured revolving credit
facility which is secured by all current assets of the company and
as a result is senior to the notes.
The Ba1 rating on Wendy's $200 million senior secured revolving
credit facility reflect the facilities first lien position in the
capital structure as well as the significant amount of liabilities
that are ranked junior to this facility. This provides a
significant cushion for these secured lenders in a distress
situation.
The B1 corporate family rating reflects Wendy's moderately high
leverage and relatively low margins for the current rating,
adequate liquidity, strong brand recognition, and relatively
stable revenue stream provided by its franchised focused business
model. However, Wendy's operating performance is being impacted by
a deteriorating consumer environment, cost inflation, and
competitive pressures that continue to weigh heavily on earnings
and margins.
The stable outlook reflects Moody's view that Wendy's liquidity is
adequate and that the cushion under its financial covenants should
remain more than sufficient. The outlook also reflects debt
protection metrics that are expected to remain reasonable for the
current B1 CFR.
The most recent rating action on Wendy's was the continuation of
the review for possible downgrade on April 24, 2008.
Wendy's International, Inc., owns, operates and franchises quick
service restaurants (QSR) under the name Wendy's Old Fashion
Hamburgers. The majority of Wendy's 1,465 owned and 5,208
franchised restaurants located within the U.S. domestic market.
Wendy's, which generated revenues of approximately $2.4 billion
for the twelve month period ending June 30, 2008, is a wholly-
owned subsidiary of Wendy's/Arby's Group Inc. (Wendy's/Arby's).
WORKFLOW MANAGEMENT: Moody's Cuts CFR to Caa3; Developing Outlook
-----------------------------------------------------------------
Moody's Investors Service has downgraded Workflow Management,
Inc.'s ratings.
Ratings downgraded:
Corporate Family rating - to Caa3 from Caa1
Probability of Default rating - to Caa3 from Caa1
Senior secured first lien revolving credit facility, due 2010 --
to Caa1, LGD2, 28% from B2, LGD2, 27%
Senior secured first lien term loan facility, due 2011 -- to Caa1,
LGD2, 28% from B2, LGD2, 27%
Senior secured second lien term loan facility, due 2011 -- to Ca,
LGD5, 74% from Caa2, LGD5, 71%
The rating outlook is developing.
This concludes the review for possible downgrade which was
initiated in December 2007.
The downgrade of the Corporate Family rating to Caa3 reflects
Moody's heightened concern regarding Workflow's squeezed liquidity
profile, the probability of near-term payment and covenant
defaults, the possibility that management may be forced to
consider a complete restructuring of the company's balance sheet
if a proposed merger is not successfully consummated under
favorable terms and conditions, and an expectation that lenders
may receive no more than average recovery in a distress scenario.
The downgrade of the PDR to Caa3 underscores Moody's expectation
that Workflow will be unable to generate cash from internal
sources in an amount sufficient to fund its maturing term loan
debt obligations (currently amortizing at the rate of
approximately $7 million a quarter), resulting in a high
probability that a payment default (in addition to prospective
future covenant defaults) will occur as early as March 30, 2009,
absent an amendment.
Nonetheless, the developing outlook indicates the possibility that
Workflow's ratings could be upgraded or the rating outlook could
be changed to positive if a recently announced merger agreement is
successfully concluded. According to management, this transaction
would provide the company with an injection of cash sufficient to
reduce its debt burden by approximately $220 million. Moreover, an
improvement of the rating outlook and potentially ratings is also
possible if Workflow's primary owners (funds associated with The
Perseus Group LLC) issue a firm commitment to continue providing
the company with adequate cash equity support.
Moody's considers that Workflow's lenders will agree to loosen the
company's financial covenants or extend its debt repayment
schedule only upon reasonable assurance that it will receive
adequate funding from external sources and in return for
substantially higher pricing (the latter placing further strain
upon the company's liquidity profile).
At the end of September 2008, Workflow reported liquid resources
of approximately $20 million, including $11 million of cash and $9
in undrawn availability under a $40 million revolving credit
facility. However, according to Moody's calculations, Workflow's
financial covenants effectively precluded the company from drawing
more than $4 million under the revolver. Moody's considers that
Workflow's modest free cash flow will be unable to provide the
company with any meaningful improvement in liquidity over the near
term.
On August 25, 2008, Workflow and Enterprise Acquisition
Corporation announced their plans to conclude a merger in a
transaction valued at approximately $669 million, including the
assumption of up to $490 million in Workflow indebtedness.
Completion of the merger (which management expects will occur in
Q408 or Q109) is dependent upon EAC shareholder approval.
Incorporated in 2007, EAC is a development-stage "blank check"
company, formed to acquire operating businesses. As of September
30, 2008, EAC has not commenced any operations. Although the
proposed merger with Workflow is conditioned upon EAC shareholder
approval, Moody's notes that a preliminary proxy statement seeking
shareholder approval still has yet to be filed.
In July 2008, Moody's downgraded Workflow's Corporate Family
rating to Caa1, while continuing the rating review (for possible
downgrade) initiated in December 2007.
Headquartered in Stamford, Connecticut, Workflow Management, Inc.
is a leading provider of managed print and promotional production
and fulfillment solutions sources. For the LTM period ended
September 30, 2008, the company reported sales of approximately
$973 million.
X-RITE INCORPORATED: Sagard Capital Discloses 15.1% Equity Stake
----------------------------------------------------------------
Sagard Capital Partners, L.P., Sagard Capital Partners GP, Inc.,
Sagard Capital Partners Management Corporation, disclosed in a
Securities and Exchange Commission filing that they may be deemed
to beneficially own 11,807,544 shares of X-Rite Incorporated's
common stock, representing 15.1% of the shares issued and
outstanding.
About X-Rite
X-Rite Incorporated (NASDAQ:XRIT) -- http://www.xrite.com/--
including unit Pantone Inc., develops, manufactures, markets and
supports innovative color solutions through measurement systems,
software, color standards and services. X-Rite serves a range of
industries, including printing, packaging, photography, graphic
design, video, automotive, paints, plastics, textiles, dental and
medical.
* * *
As reported in the Troubled Company Reporter on Aug. 27, 2008,
Standard & Poor's Ratings Services revised its CreditWatch on X-
Rite Inc. to positive from developing.
On Aug. 20, 2008, X-Rite Inc. (CCC+/Watch Pos/--) announced that
it had signed a forbearance and new lender agreement and investor
agreements that include a plan to substantially reduce debt,
primarily through the issuance of $155 million in common equity to
new and certain existing shareholders. The agreement also
provides the company with access to up to $10 million on its
revolving credit agreement.
* Charles A. Stanziale, Jr., et al., Joins McCarter & English
-------------------------------------------------------------
Charles A. Stanziale, Jr., one of New Jersey's preeminent
bankruptcy lawyers, has joined the Newark office of McCarter &
English along with colleagues Jeffrey T. Testa and Brian L. Baker.
In addition, two associates have accompanied the three new
partners, all of whom were with McElroy, Deutsch, Mulvaney &
Carpenter, LLP.
"[Mr.] Stanziale is clearly one of the top debtor-creditor lawyers
practicing in New Jersey and surrounding states, and we are
delighted to add him, [Messrs. Baker and Testa to an already-
robust bankruptcy and restructuring group with lawyers engaged
in significant cases in New Jersey, New York and Delaware," said
McCarter & English managing partner Eric Wiechmann.
"On a personal note, ever since we played high school sports
against each other, I have known [Mr. Stanziale] to be
competitive, fair and team-oriented in his approach - qualities
which have served him well professionally and will contribute to
his future success here," McCarter & English chairman Drew Berry
added.
"McCarter's long commitment to the practice of bankruptcy law,
including strong representation in the New York and Wilmington
offices, among others, was a major attraction," Mr. Stanziale
said. "We look forward to working with the McCarter team, which
we have known and respected for years."
Mr. Stanziale has practiced financial restructuring, insolvency
and creditors rights law for over 40 years and has been involved
in many of New Jersey's most prominent cases on behalf of debtors,
trustees, creditor's committees, banks and other secured parties.
He has been appointed operating trustee in numerous Chapter 11
cases and both operating and liquidating trustee in Chapter 7
cases, as well as acting as a litigation trustee in several
matters.
A graduate of Seton Hall University (B.A., 1962) and the
University of Richmond School of Law (J.D., 1965), Mr. Stanziale
is admitted to practice before the Supreme Court of the United
States, the Third Circuit Court of Appeals and the United States
Court of International Trade. He is on the Mediation Panels of
the United States District Court for the District of New Jersey
and the United States Bankruptcy Court for the District of
Delaware.
Mr. Stanziale served as a delegate to the Third Circuit Judicial
Conference representing former Chief Judge Clarkson Fisher. He is
a former judge of the Newark Municipal Court and former Assistant
Corporation Counsel for the City of Newark.
Mr. Baker has practiced debter-creditor law since 1995,
participating in the reorganization of companies in the chemical,
metal, retail, restaurant, temporary services, fashion,
healthcare, and technology industries. A graduate of the State
University of New York at Albany (B.A., 1991) and Pace University
School of Law (J.D., 1994), where he served as a Research and
Writing Editor of the Pace International Law Review, Mr. Baker
is admitted to the bars of the State of New Jersey, the United
States District Court for the District of New Jersey, the State
of New York, and the United States Court of Appeals for the Third
Circuit.
Mr. Testa has represented creditors, debtors and trustees in
some of the nation's largest and most sophisticated bankruptcy
proceedings. He has also represented clients in litigation,
mediations and arbitrations involving a wide array of complex
civil litigation issues. A graduate of Seton Hall University
(B.A. cum laude, 1995) and Seton Hall University School of Law
(J.D., 1998), he is admitted to the bar of New Jersey, the
District Court of New Jersey, the Southern District of New York,
the Eastern District of New York and the United States Third
Circuit Court of Appeals. Mr. Testa served as the judicial law
clerk to the Honorable Raymond A. Hayser, J.T.C. in the Superior
Court of New Jersey, Law Division.
Among the group's prominent roles in high-profile bankruptcies,
they served as:
-- Counsel to the Chapter 11 Trustee of In re Solomon Dwek
et al., pending in the United States Bankruptcy Court for
the District of New Jersey, in which the Chapter 11 Trustee
oversees the liquidation of a massive real estate portfolio
encompassing properties across the nation and the untangling
of a massive fraudulent scheme;
-- Counsel to the Chapter 11 Trustee of In re Pappas
Telecasting, Inc. et al., currently pending in the United
States Bankruptcy Court for the District of Delaware, whom,
along with their non-debtor affiliates operate the largest
privately held, commercial television broadcast group in
the United states in terms of U.S. household coverage as
defined by Nielsen Media Research;
-- Co-counsel to Trump Hotels Casinos & Resorts in its
restructuring of more than $1.5 billion of debt and post
confirmation litigation matters in the United States
Bankruptcy Court for the District of New Jersey;
-- Co-counsel to the Official Committee of Unsecured
Creditors of GB Holdings, Inc., in the United States
Bankruptcy Court for the District of New Jersey relating to
the Sands Casino in its successful termination of
exclusivity and confirmation of a Plan of Reorganization;
-- Counsel to the Chapter 11 and Chapter 7 Trustee of Tower
Air, Inc., in the United States District Court for the
District of Delaware during which the Chapter 11 Trustee
operated the airline on international charter.
About McCarter & English LLP
Headquartered in Newark, New Jersey, McCarter & English LLP --
http://www.mccarter.com/-- established more than 160 years ago,
represents Fortune 500 and middle-market companies in their
national, regional and local litigation and on important
transactions. Its 400 attorneys are based in offices in Boston,
Hartford, New York, Newark, Philadelphia, Stamford and Wilmington.
* Moody's Sees Likely Failure of CDS Market Participants
--------------------------------------------------------
The bankruptcy of Lehman Brothers has put the CDS market to an
unprecedented test and has resulted in losses in the hundreds of
millions dollars for a number of Moody's-rated firms, but these
CDS market disruptions have not, in and of themselves, resulted in
the downgrade of any rated company to date, Moody's Investors
Service concludes in a new report.
Moody's, however, also sees the possible failure or failures of
other large CDS market participants as a continuing source of
systemic risk. In Moody's opinion, it is highly unlikely that the
CDS market would have been able to deal effectively with a
simultaneous default by AIG -- probably the largest net seller of
CDS protection.
A survey conducted by Moody's of the major Moody's-rated banks and
insurance firms active in the CDS market suggests that the overall
market has fared better than many observers had anticipated.
"Lehman's bankruptcy, although resulting in sizable losses for a
number of market participants, did not lead to the unraveling of
the CDS market," Moody's AVP/Analyst Alexander Yavorsky concludes.
Still, he adds that the emergency unwinding of Lehman's CDS book
by major dealers and hedge funds though the "Risk Reduction
Trading Session" on the weekend preceding Lehman's anticipated
bankruptcy filing demonstrates that the over-the-counter CDS
market is "ill-equipped to reliably deal with such events."
Given Lehman's role as a major CDS dealer, its default and the
resultant credit spread widening left its CDS counterparties
needing to replace lost protection at much higher prices. For a
number of the major CDS dealers, this resulted in losses that,
while substantial, did not fall outside of the range that could be
tolerated at any company's rating level at the time.
Moody's noted that major dealers also did not suffer losses in
excess of their ratings-tolerance on CDS contracts referencing
Lehman Brothers as an obligor, despite the low auction-determined
settlement price of 8.625 cents on the dollar for Lehman's senior
bonds.
"Many dealers had flat or net short CDS exposure to Lehman's
credit as a way to hedge their counterparty exposure to the firm,"
Moody's Yavorsky explains.
The report also discusses what Yavorsky characterizes as
"encouraging progress" among market participants and regulators to
move the CDS market, or at least a portion of it, to a central
counterparty model. If implemented effectively, a central
clearinghouse could substantially reduce, although not completely
eliminate, counterparty and trade replacement risks. It could also
impose economic limits on effective leverage and excessive credit
exposure by requiring protection sellers to post appropriate
initial margin.
The report "Credit Default Swaps: Market, Systemic, and Individual
Firm Risks in Practice" follows another study published by Moody's
earlier this year to highlight some of the key risks of the CDS
market, the most significant of which the rating agency concluded
at the time was the consequences of a possible default by a major
dealer.
In addition to the report, Moody's will host a teleconference to
discuss its opinion on the credit default swaps market on Monday,
November 3rd at 01:00pm EDT. Visit http://www.moodys.com/events
for further information.
* BOND PRICING: For the Week of Oct. 12 - Oct. 18, 2008
-------------------------------------------------------
Issuer Coupon Maturity Bid Price
------ ------ -------- ---------
ABITIBI-CONS FIN 7.875% 8/1/2009 75.00
AIRTRAN HOLDINGS 7.000% 7/1/2023 51.25
AMER GENL CORP 7.500% 8/11/2010 70.23
AMER GENL FIN 4.000% 6/15/2009 53.13
AMER GENL FIN 4.500% 9/15/2009 59.50
AMER GENL FIN 5.000% 9/15/2009 64.05
AMER GENL FIN 5.150% 9/15/2009 60.50
AMER GENL FIN 3.875% 10/1/2009 58.82
AMER GENL FIN 4.550% 10/15/2009 38.85
AMER GENL FIN 3.875% 11/15/2009 38.96
AMER GENL FIN 4.000% 11/15/2009 60.07
AMER GENL FIN 4.000% 11/15/2009 65.35
AMER GENL FIN 4.200% 11/15/2009 62.15
AMER GENL FIN 4.600% 11/15/2009 17.50
AMER GENL FIN 4.750% 4/15/2010 47.50
AMER GENL FIN 4.050% 5/15/2010 56.22
AMER GENL FIN 4.875% 5/15/2010 50.50
AMER GENL FIN 3.300% 6/15/2010 50.78
AMER GENL FIN 4.300% 6/15/2010 55.00
AMER GENL FIN 4.750% 6/15/2010 52.70
AMER GENL FIN 4.875% 6/15/2010 54.50
AMER GENL FIN 5.200% 6/15/2010 51.50
AMER GENL FIN 5.350% 7/15/2010 36.50
AMER GENL FIN 6.250% 7/15/2010 50.15
AMER GENL FIN 4.500% 8/15/2010 38.25
AMER GENL FIN 8.000% 8/15/2010 55.00
AMER GENL FIN 4.625% 9/1/2010 49.98
AMER GENL FIN 4.600% 9/15/2010 44.06
AMER GENL FIN 5.000% 9/15/2010 35.00
AMER GENL FIN 5.200% 9/15/2010 26.01
AMER GENL FIN 4.250% 10/15/2010 50.23
AMER GENL FIN 4.600% 10/15/2010 34.02
AMER GENL FIN 4.150% 11/15/2010 29.13
AMER GENL FIN 5.000% 11/15/2010 35.31
AMER GENL FIN 5.000% 11/15/2010 49.50
AMER GENL FIN 4.400% 12/15/2010 45.25
AMER GENL FIN 5.000% 12/15/2010 48.07
AMER GENL FIN 5.000% 12/15/2010 31.00
AMER GENL FIN 5.000% 12/15/2010 21.00
AMER GENL FIN 5.500% 12/15/2010 22.00
AMER GENL FIN 5.000% 1/15/2011 25.01
AMER GENL FIN 4.000% 3/15/2011 34.00
AMER GENL FIN 5.000% 3/15/2011 34.00
AMER GENL FIN 5.250% 4/15/2011 25.01
AMER GENL FIN 5.500% 4/15/2011 35.31
AMER GENL FIN 5.200% 5/15/2011 44.88
AMER GENL FIN 5.000% 6/15/2011 15.01
AMER GENL FIN 5.600% 6/15/2011 40.00
AMER GENL FIN 6.000% 7/15/2011 25.01
AMER GENL FIN 6.250% 7/15/2011 12.05
AMER GENL FIN 6.250% 7/15/2011 43.00
AMER GENL FIN 8.150% 8/15/2011 20.10
AMER GENL FIN 5.625% 8/17/2011 36.00
AMER GENL FIN 4.300% 10/15/2011 21.40
AMER GENL FIN 5.200% 12/15/2011 31.00
AMER GENL FIN 4.625% 3/15/2012 30.60
AMER GENL FIN 4.100% 7/15/2012 30.26
AMER GENL FIN 4.875% 7/15/2012 40.14
AMER GENL FIN 5.000% 8/15/2012 19.00
AMER GENL FIN 5.850% 9/15/2012 24.27
AMER GENL FIN 5.375% 10/1/2012 33.00
AMER GENL FIN 5.250% 12/15/2012 31.25
AMER GENL FIN 6.000% 4/15/2013 25.26
AMER GENL FIN 6.000% 4/15/2013 11.20
AMER GENL FIN 5.400% 5/15/2013 26.00
AMER GENL FIN 5.750% 5/15/2013 23.89
AMER GENL FIN 5.850% 6/1/2013 31.00
AMER GENL FIN 5.500% 5/15/2014 26.26
AMER GENL FIN 5.500% 6/15/2014 15.20
AMER GENL FIN 6.000% 11/15/2014 21.00
AMER GENL FIN 6.000% 12/15/2014 24.00
AMER GENL FIN 7.500% 7/15/2015 25.25
AMER GENL FIN 3.750% 11/15/2008 75.36
AMER GENL FIN 3.000% 12/15/2008 81.75
AMER GENL FIN 3.750% 12/15/2008 95.06
AMER GENL FIN 3.750% 12/15/2008 84.50
AMER GENL FIN 3.875% 12/15/2008 92.00
AMER GENL FIN 3.800% 4/15/2009 72.00
AMER GENL FIN 3.350% 5/15/2009 34.01
AMER GENL FIN 4.625% 5/15/2009 68.28
AMER GENL FIN 4.350% 6/15/2009 44.89
AMER GENL FIN 3.100% 7/15/2009 44.00
AMER GENL FIN 4.400% 7/15/2009 41.00
AMER GENL FIN 4.500% 7/15/2009 80.00
AMER GENL FIN 4.000% 8/15/2009 68.00
AMER GENL FIN 4.200% 8/15/2009 45.00
AMER GENL FIN 5.375% 9/1/2009 64.50
AMER GENL FIN 4.300% 9/15/2009 50.03
AMER INTL GROUP 5.375% 10/18/2011 52.56
AMER INTL GROUP 5.750% 3/15/2067 19.97
AMER INTL GROUP 8.175% 5/15/2058 19.92
AMER MEDIA OPER 10.250% 5/1/2009 68.50
AMES TRUE TEMPER 10.000% 7/15/2012 50.00
AMR CORP 4.500% 2/15/2024 91.50
ANTIGENICS 5.250% 2/1/2025 30.50
ARVIN INDUSTRIES 7.125% 3/15/2009 88.78
ASSURED GUARANTY 6.400% 12/15/2066 10.00
ATHEROGENICS INC 1.500% 2/1/2012 10.13
ATHEROGENICS INC 4.500% 9/1/2008 11.50
ATHEROGENICS INC 4.500% 3/1/2011 11.50
BALLY TOTAL FITN 13.000% 7/15/2011 17.00
BANK NEW ENGLAND 9.875% 9/15/1999 3.00
BANK NEW ENGLAND 8.750% 4/1/1999 5.75
BANKUNITED CAP 3.125% 3/1/2034 22.90
BON-TON DEPT STR 10.250% 3/15/2014 17.10
BOWATER INC 6.500% 6/15/2013 25.00
BRODER BROS CO 11.250% 10/15/2010 39.25
CARAUSTAR INDS 7.375% 6/1/2009 55.03
CCH I LLC 9.920% 4/1/2014 25.00
CCH I LLC 10.000% 5/15/2014 31.00
CCH II/CCH II CP 10.250% 9/15/2010 90.00
CELL GENESYS INC 3.125% 11/1/2011 15.00
CELL THERAPEUTIC 5.750% 12/15/2011 1.00
CHANCELLOR MEDIA 8.000% 11/1/2008 97.00
CHARTER COMM HLD 11.125% 1/15/2011 49.68
CHARTER COMM HLD 10.000% 4/1/2009 76.03
CHARTER COMM HLD 10.000% 5/15/2011 54.00
CHARTER COMM INC 6.500% 10/1/2027 16.45
CHENIERE ENERGY 2.250% 8/1/2012 16.00
CIT GROUP INC 5.200% 9/15/2011 42.02
CIT GROUP INC 6.250% 9/15/2009 65.00
CIT GROUP INC 5.800% 7/28/2011 57.00
CIT GROUP INC 6.750% 3/15/2011 43.50
CIT GROUP INC 5.050% 12/15/2010 47.88
CIT GROUP INC 4.750% 12/15/2010 61.00
CIT GROUP INC 5.200% 11/3/2010 62.00
CIT GROUP INC 5.250% 9/15/2010 51.63
CIT GROUP INC 6.500% 3/15/2010 62.15
CIT GROUP INC 4.250% 2/1/2010 62.85
CIT GROUP INC 4.125% 11/3/2009 75.05
CIT GROUP INC 6.875% 11/1/2009 83.80
CIT GROUP INC 3.875% 11/3/2008 97.50
CIT GROUP INC 3.375% 4/1/2009 82.00
CIT GROUP INC 7.250% 3/15/2012 34.00
CIT GROUP INC 5.125% 11/15/2008 93.50
CIT GROUP INC 7.250% 3/15/2013 39.00
CIT GROUP INC 7.900% 3/15/2013 36.53
CLAIRE'S STORES 10.500% 6/1/2017 20.00
CLEAR CHANNEL 5.750% 1/15/2013 24.00
CLEAR CHANNEL 5.500% 9/15/2014 23.00
CLEAR CHANNEL 6.250% 3/15/2011 14.00
CMP SUSQUEHANNA 9.875% 5/15/2014 22.00
COEUR D'ALENE 1.250% 1/15/2024 40.00
COMPUCREDIT 3.625% 5/30/2025 23.00
CONSTAR INTL 11.000% 12/1/2012 20.50
DAYTON SUPERIOR 13.000% 6/15/2009 77.25
DELPHI CORP 6.500% 8/15/2013 5.38
DELTA MILLS INC 9.625% 9/1/2007 9.00
DEX MEDIA INC 8.000% 11/15/2013 20.00
DOLE FOODS CO 8.625% 5/1/2009 87.84
FEDDERS NORTH AM 9.875% 3/1/2014 1.25
FIBERTOWER CORP 9.000% 11/15/2012 40.00
FINLAY FINE JWLY 8.375% 6/1/2012 14.75
FIRST DATA CORP 5.625% 11/1/2011 30.68
FLEETWOOD ENTERP 5.000% 12/15/2023 89.20
FORD MOTOR CO 9.980% 2/15/2047 33.96
FORD MOTOR CRED 5.000% 10/20/2008 99.38
FORD MOTOR CRED 5.250% 10/20/2008 99.04
FORD MOTOR CRED 5.000% 11/20/2008 87.50
FORD MOTOR CRED 5.100% 12/22/2008 90.00
FORD MOTOR CRED 5.100% 12/22/2008 89.00
FORD MOTOR CRED 5.800% 1/12/2009 91.85
FORD MOTOR CRED 4.400% 1/20/2009 89.25
FORD MOTOR CRED 4.600% 1/20/2009 90.90
FORD MOTOR CRED 4.350% 2/20/2009 87.34
FORD MOTOR CRED 4.350% 2/20/2009 87.62
FORD MOTOR CRED 4.500% 2/20/2009 84.26
FORD MOTOR CRED 4.300% 3/20/2009 39.50
FORD MOTOR CRED 4.500% 3/20/2009 79.99
FORD MOTOR CRED 4.450% 4/20/2009 63.16
FORD MOTOR CRED 4.650% 4/20/2009 77.01
FORD MOTOR CRED 4.900% 5/20/2009 73.56
FORD MOTOR CRED 5.350% 5/20/2009 82.00
FORD MOTOR CRED 5.250% 6/22/2009 70.45
FORD MOTOR CRED 5.400% 6/22/2009 73.27
FORD MOTOR CRED 5.500% 6/22/2009 70.57
FORD MOTOR CRED 5.500% 6/22/2009 70.57
FORD MOTOR CRED 4.800% 7/20/2009 66.22
FORD MOTOR CRED 5.100% 7/20/2009 59.66
FORD MOTOR CRED 5.200% 7/20/2009 48.44
FORD MOTOR CRED 5.000% 8/20/2009 57.00
FORD MOTOR CRED 5.000% 8/20/2009 63.53
FORD MOTOR CRED 4.900% 9/21/2009 69.40
FORD MOTOR CRED 5.000% 9/21/2009 66.00
FORD MOTOR CRED 5.000% 9/21/2009 54.50
FORD MOTOR CRED 5.050% 9/21/2009 57.30
FORD MOTOR CRED 4.900% 10/20/2009 62.80
FORD MOTOR CRED 4.900% 10/20/2009 55.00
FORD MOTOR CRED 4.950% 10/20/2009 60.15
FORD MOTOR CRED 5.000% 10/20/2009 56.00
FORD MOTOR CRED 7.375% 10/28/2009 65.00
FORD MOTOR CRED 5.100% 11/20/2009 36.56
FORD MOTOR CRED 5.150% 11/20/2009 52.98
FORD MOTOR CRED 5.150% 11/20/2009 62.95
FORD MOTOR CRED 5.150% 11/20/2009 53.62
FORD MOTOR CRED 5.250% 12/21/2009 45.00
FORD MOTOR CRED 5.250% 12/21/2009 63.98
FORD MOTOR CRED 5.400% 12/21/2009 45.50
FORD MOTOR CRED 5.700% 1/15/2010 63.00
FORD MOTOR CRED 5.250% 1/20/2010 51.95
FORD MOTOR CRED 5.500% 1/20/2010 54.20
FORD MOTOR CRED 5.500% 2/22/2010 55.00
FORD MOTOR CRED 5.500% 2/22/2010 54.85
FORD MOTOR CRED 6.000% 2/22/2010 42.65
FORD MOTOR CRED 5.700% 3/22/2010 57.19
FORD MOTOR CRED 5.750% 3/22/2010 50.66
FORD MOTOR CRED 6.300% 3/22/2010 50.00
FORD MOTOR CRED 7.250% 3/22/2010 36.68
FORD MOTOR CRED 6.950% 4/20/2010 33.81
FORD MOTOR CRED 5.850% 5/20/2010 31.21
FORD MOTOR CRED 5.950% 5/20/2010 47.56
FORD MOTOR CRED 6.300% 5/20/2010 37.10
FORD MOTOR CRED 7.875% 6/15/2010 56.00
FORD MOTOR CRED 5.750% 6/21/2010 45.63
FORD MOTOR CRED 5.850% 6/21/2010 48.25
FORD MOTOR CRED 6.000% 6/21/2010 48.90
FORD MOTOR CRED 5.850% 7/20/2010 45.02
FORD MOTOR CRED 6.050% 7/20/2010 55.11
FORD MOTOR CRED 6.150% 7/20/2010 45.00
FORD MOTOR CRED 7.000% 7/20/2010 46.50
FORD MOTOR CRED 6.400% 8/20/2010 39.73
FORD MOTOR CRED 6.500% 8/20/2010 40.01
FORD MOTOR CRED 6.550% 8/20/2010 37.00
FORD MOTOR CRED 7.150% 8/20/2010 43.00
FORD MOTOR CRED 9.750% 9/15/2010 57.00
FORD MOTOR CRED 6.050% 9/20/2010 52.00
FORD MOTOR CRED 6.150% 9/20/2010 46.00
FORD MOTOR CRED 6.350% 9/20/2010 44.00
FORD MOTOR CRED 6.350% 9/20/2010 40.00
FORD MOTOR CRED 5.750% 10/20/2010 46.00
FORD MOTOR CRED 8.625% 11/1/2010 44.88
FORD MOTOR CRED 5.800% 11/22/2010 45.00
FORD MOTOR CRED 5.600% 12/20/2010 53.31
FORD MOTOR CRED 5.650% 12/20/2010 37.00
FORD MOTOR CRED 6.000% 12/20/2010 46.98
FORD MOTOR CRED 5.150% 1/20/2011 24.00
FORD MOTOR CRED 7.375% 2/1/2011 46.00
FORD MOTOR CRED 5.100% 2/22/2011 33.32
FORD MOTOR CRED 5.250% 2/22/2011 44.66
FORD MOTOR CRED 5.200% 3/21/2011 25.91
FORD MOTOR CRED 5.250% 3/21/2011 43.00
FORD MOTOR CRED 5.600% 4/20/2011 19.31
FORD MOTOR CRED 5.700% 5/20/2011 41.50
FORD MOTOR CRED 6.200% 5/20/2011 33.98
FORD MOTOR CRED 6.050% 6/20/2011 19.00
FORD MOTOR CRED 6.200% 6/20/2011 42.76
FORD MOTOR CRED 6.250% 6/20/2011 24.79
FORD MOTOR CRED 5.650% 7/20/2011 27.94
FORD MOTOR CRED 5.900% 7/20/2011 17.03
FORD MOTOR CRED 9.875% 8/10/2011 49.00
FORD MOTOR CRED 5.600% 8/22/2011 16.24
FORD MOTOR CRED 5.750% 8/22/2011 41.04
FORD MOTOR CRED 5.500% 10/20/2011 17.13
FORD MOTOR CRED 7.250% 10/25/2011 40.50
FORD MOTOR CRED 5.600% 11/21/2011 12.98
FORD MOTOR CRED 5.650% 11/21/2011 32.00
FORD MOTOR CRED 5.850% 1/20/2012 16.58
FORD MOTOR CRED 6.000% 1/20/2012 38.00
FORD MOTOR CRED 5.750% 2/21/2012 30.28
FORD MOTOR CRED 7.800% 6/1/2012 46.00
FORD MOTOR CRED 7.000% 8/15/2012 32.07
FORD MOTOR CRED 7.050% 9/20/2013 15.76
FORD MOTOR CRED 7.100% 9/20/2013 18.63
FORD MOTOR CRED 7.100% 9/20/2013 30.31
FORD MOTOR CRED 6.600% 10/21/2013 24.00
FORD MOTOR CRED 6.650% 10/21/2013 12.00
FORD MOTOR CRED 6.750% 10/21/2013 21.00
FORD MOTOR CRED 6.250% 12/20/2013 20.10
FORD MOTOR CRED 6.500% 12/20/2013 28.50
FORD MOTOR CRED 5.650% 1/21/2014 21.54
FORD MOTOR CRED 5.750% 1/21/2014 24.50
FORD MOTOR CRED 6.000% 1/21/2014 21.10
FORD MOTOR CRED 5.750% 2/20/2014 27.00
FORD MOTOR CRED 6.000% 3/20/2014 27.00
FORD MOTOR CRED 6.000% 3/20/2014 24.02
FORD MOTOR CRED 6.000% 3/20/2014 27.30
FORD MOTOR CRED 6.000% 3/20/2014 25.23
FORD MOTOR CRED 6.050% 4/21/2014 25.13
FORD MOTOR CRED 6.200% 4/21/2014 25.22
FORD MOTOR CRED 6.250% 4/21/2014 25.32
FORD MOTOR CRED 6.350% 4/21/2014 27.00
FORD MOTOR CRED 6.300% 5/20/2014 25.18
FORD MOTOR CRED 6.850% 5/20/2014 21.10
FORD MOTOR CRED 6.950% 5/20/2014 27.50
FORD MOTOR CRED 6.650% 6/20/2014 24.00
FORD MOTOR CRED 6.750% 6/20/2014 27.00
FORD MOTOR CRED 6.800% 6/20/2014 25.66
FORD MOTOR CRED 6.800% 6/20/2014 20.10
FORD MOTOR CRED 6.850% 6/20/2014 20.13
FORD MOTOR CRED 6.550% 7/21/2014 25.30
FORD MOTOR CRED 6.000% 11/20/2014 22.10
FORD MOTOR CRED 6.000% 11/20/2014 13.20
FORD MOTOR CRED 6.000% 11/20/2014 21.10
FORD MOTOR CRED 6.050% 12/22/2014 22.71
FORD MOTOR CRED 6.050% 12/22/2014 22.56
FORD MOTOR CRED 6.150% 1/20/2015 12.70
FORD MOTOR CRED 6.250% 1/20/2015 24.00
FORD MOTOR CRED 6.500% 2/20/2015 14.36
FORD MOTOR CRED 6.250% 3/20/2015 25.01
FORD MOTOR CRED 6.500% 3/20/2015 24.50
FORD MOTOR CRED 6.800% 3/20/2015 23.47
FORD MOTOR CRED 7.350% 3/20/2015 18.76
FORD MOTOR CRED 7.250% 7/20/2017 14.94
FORD MOTOR CRED 5.900% 2/20/2014 26.46
FREMONT GEN CORP 7.875% 3/17/2009 54.00
FRONTIER AIRLINE 5.000% 12/15/2025 25.00
GENERAL MOTORS 8.250% 7/15/2023 23.30
GENERAL MOTORS 8.375% 7/15/2033 23.00
GENERAL MOTORS 8.800% 3/1/2021 24.96
GENERAL MOTORS 9.450% 11/1/2011 36.28
GENERAL MOTORS 7.125% 7/15/2013 29.50
GENERAL MOTORS 7.200% 1/15/2011 38.00
GENERAL MOTORS 9.400% 7/15/2021 28.80
GENERAL MOTORS 7.700% 4/15/2016 21.25
GENWORTH GLOBAL 6.050% 4/15/2033 14.75
GEORGIA GULF CRP 10.750% 10/15/2016 24.75
GLOBALSTAR INC 5.750% 4/1/2028 22.50
GMAC 4.700% 5/15/2009 50.50
GMAC 4.700% 11/15/2008 92.97
GMAC 4.750% 11/15/2008 84.99
GMAC 6.250% 11/15/2008 95.00
GMAC 6.500% 11/15/2008 99.58
GMAC 5.600% 2/15/2009 90.82
GMAC 6.750% 2/15/2009 91.12
GMAC 7.000% 2/15/2009 67.83
GMAC 4.100% 3/15/2009 75.44
GMAC 4.250% 3/15/2009 73.92
GMAC 6.000% 3/15/2009 92.00
GMAC 6.050% 3/15/2009 88.74
GMAC 6.100% 3/15/2009 88.75
GMAC 7.000% 3/15/2009 73.06
GMAC 4.500% 4/15/2009 74.01
GMAC 6.000% 4/15/2009 68.72
GMAC 6.100% 4/15/2009 90.46
GMAC 6.100% 4/15/2009 86.63
GMAC 6.150% 4/15/2009 90.59
GMAC 5.250% 5/15/2009 70.00
GMAC 5.625% 5/15/2009 74.00
GMAC 5.500% 6/15/2009 63.51
GMAC 6.700% 6/15/2009 72.63
GMAC 5.050% 7/15/2009 51.13
GMAC 5.100% 7/15/2009 58.82
GMAC 5.250% 7/15/2009 48.00
GMAC 5.250% 7/15/2009 41.50
GMAC 6.800% 7/15/2009 70.11
GMAC 6.850% 7/15/2009 61.89
GMAC 7.000% 7/15/2009 67.94
GMAC 5.000% 8/15/2009 46.55
GMAC 5.000% 8/15/2009 47.50
GMAC 5.100% 8/15/2009 55.00
GMAC 5.250% 8/15/2009 60.50
GMAC 5.250% 8/15/2009 45.50
GMAC 7.000% 8/15/2009 66.35
GMAC 7.125% 8/15/2009 49.00
GMAC 7.150% 8/15/2009 61.00
GMAC 7.200% 8/15/2009 42.00
GMAC 5.000% 9/15/2009 51.78
GMAC 5.000% 9/15/2009 45.00
GMAC 5.000% 9/15/2009 47.17
GMAC 5.100% 9/15/2009 47.02
GMAC 7.000% 9/15/2009 46.64
GMAC 7.000% 9/15/2009 57.63
GMAC 8.125% 9/15/2009 78.31
GMAC 4.900% 10/15/2009 51.50
GMAC 4.900% 10/15/2009 54.50
GMAC 4.950% 10/15/2009 62.83
GMAC 5.000% 10/15/2009 51.65
GMAC 6.500% 10/15/2009 61.66
GMAC 6.850% 10/15/2009 44.00
GMAC 7.000% 10/15/2009 47.50
GMAC 7.050% 10/15/2009 49.93
GMAC 5.200% 11/15/2009 38.00
GMAC 5.200% 11/15/2009 41.00
GMAC 5.250% 11/15/2009 48.27
GMAC 5.250% 11/15/2009 51.64
GMAC 5.350% 11/15/2009 43.43
GMAC 7.000% 11/15/2009 45.00
GMAC 7.250% 11/15/2009 59.91
GMAC 5.350% 12/15/2009 39.12
GMAC 5.350% 12/15/2009 53.55
GMAC 5.400% 12/15/2009 44.00
GMAC 5.400% 12/15/2009 48.29
GMAC 7.000% 12/15/2009 58.00
GMAC 5.300% 1/15/2010 42.17
GMAC 5.500% 1/15/2010 52.00
GMAC 5.750% 1/15/2010 38.29
GMAC 6.000% 1/15/2010 35.71
GMAC 7.000% 1/15/2010 55.68
GMAC 7.250% 1/15/2010 47.00
GMAC 5.850% 2/15/2010 42.26
GMAC 6.000% 2/15/2010 23.16
GMAC 6.000% 2/15/2010 37.97
GMAC 6.050% 3/15/2010 26.90
GMAC 6.150% 3/15/2010 15.00
GMAC 6.500% 3/15/2010 43.33
GMAC 7.000% 3/15/2010 35.56
GMAC 8.050% 4/15/2010 45.64
GMAC 8.400% 4/15/2010 45.00
GMAC 8.500% 5/15/2010 51.55
GMAC 6.375% 6/15/2010 47.95
GMAC 8.000% 6/15/2010 35.16
GMAC 8.000% 6/15/2010 46.22
GMAC 8.000% 6/15/2010 48.00
GMAC 8.000% 7/15/2010 43.25
GMAC 8.000% 7/15/2010 34.42
GMAC 8.200% 7/15/2010 38.43
GMAC 8.000% 9/15/2010 57.50
GMAC 8.500% 10/15/2010 35.00
GMAC 6.750% 9/15/2011 22.00
GMAC 6.625% 10/15/2011 22.25
GMAC 6.750% 10/15/2011 15.31
GMAC 6.750% 10/15/2011 16.50
GMAC 7.000% 10/15/2011 20.00
GMAC 6.500% 7/15/2012 30.25
GMAC 7.125% 8/15/2012 27.00
GMAC 7.250% 8/15/2012 33.25
GMAC 6.875% 8/28/2012 39.63
GMAC 6.750% 9/15/2012 24.25
GMAC 6.750% 9/15/2012 25.66
GMAC 7.000% 9/15/2012 25.35
GMAC 7.100% 9/15/2012 16.87
GMAC 6.750% 10/15/2012 25.00
GMAC 6.875% 10/15/2012 18.00
GMAC 7.000% 10/15/2012 31.16
GMAC 7.500% 10/15/2012 16.75
GMAC 7.750% 10/15/2012 15.65
GMAC 7.000% 11/15/2012 33.25
GMAC 7.150% 11/15/2012 18.50
GMAC 7.625% 11/15/2012 17.20
GMAC 7.875% 11/15/2012 21.00
GMAC 7.000% 12/15/2012 16.50
GMAC 7.125% 12/15/2012 22.00
GMAC 7.250% 12/15/2012 19.75
GMAC 7.250% 12/15/2012 25.00
GMAC 7.000% 1/15/2013 14.78
GMAC 7.100% 1/15/2013 25.00
GMAC 7.100% 1/15/2013 18.50
GMAC 6.500% 2/15/2013 20.10
GMAC 6.800% 2/15/2013 21.00
GMAC 6.250% 3/15/2013 25.00
GMAC 6.400% 3/15/2013 19.50
GMAC 6.500% 3/15/2013 13.74
GMAC 6.500% 4/15/2013 17.88
GMAC 6.750% 4/15/2013 25.00
GMAC 6.750% 4/15/2013 25.00
GMAC 6.800% 4/15/2013 22.50
GMAC 6.875% 4/15/2013 17.75
GMAC 5.850% 5/15/2013 14.66
GMAC 6.100% 5/15/2013 25.00
GMAC 6.350% 5/15/2013 19.00
GMAC 6.500% 5/15/2013 20.10
GMAC 5.700% 6/15/2013 10.00
GMAC 5.850% 6/15/2013 23.75
GMAC 5.850% 6/15/2013 21.00
GMAC 6.500% 6/15/2013 25.00
GMAC 6.000% 7/15/2013 19.10
GMAC 6.250% 7/15/2013 17.50
GMAC 6.500% 8/15/2013 35.75
GMAC 6.150% 9/15/2013 28.25
GMAC 5.700% 10/15/2013 25.00
GMAC 6.250% 10/15/2013 28.25
GMAC 6.300% 10/15/2013 19.00
GMAC 6.000% 11/15/2013 19.00
GMAC 6.100% 11/15/2013 16.77
GMAC 6.150% 11/15/2013 30.00
GMAC 6.200% 11/15/2013 18.00
GMAC 6.250% 11/15/2013 23.00
GMAC 6.300% 11/15/2013 16.75
GMAC 6.500% 11/15/2013 27.33
GMAC 5.700% 12/15/2013 20.10
GMAC 5.900% 12/15/2013 19.00
GMAC 6.000% 12/15/2013 22.12
GMAC 6.150% 12/15/2013 16.50
GMAC 5.250% 1/15/2014 21.00
GMAC 5.350% 1/15/2014 20.00
GMAC 6.375% 1/15/2014 16.75
GMAC 6.700% 6/15/2014 14.13
GMAC 6.750% 6/15/2014 17.00
GMAC 9.000% 7/15/2015 25.13
GMAC 8.000% 8/15/2015 15.75
GMAC 8.400% 8/15/2015 18.00
GMAC 8.650% 8/15/2015 17.00
GMAC 6.600% 8/15/2016 16.00
GMAC 6.700% 8/15/2016 20.00
GMAC 6.750% 8/15/2016 23.25
GMAC 6.875% 8/15/2016 20.75
GMAC 7.375% 11/15/2016 18.56
GMAC 7.500% 11/15/2016 21.60
GMAC 6.750% 6/15/2017 19.85
GMAC 6.900% 6/15/2017 15.88
GMAC 6.950% 6/15/2017 20.00
GMAC 7.000% 6/15/2017 20.33
GMAC 7.000% 7/15/2017 22.00
GMAC 7.500% 8/15/2017 20.25
GMAC 7.250% 9/15/2017 21.20
GMAC 7.250% 9/15/2017 16.15
GMAC 7.250% 9/15/2017 16.20
GMAC 7.125% 10/15/2017 15.00
GMAC 7.200% 10/15/2017 22.50
GMAC 7.200% 10/15/2017 19.50
GMAC 7.750% 10/15/2017 20.50
GMAC 8.000% 10/15/2017 14.75
GMAC 7.500% 11/15/2017 21.00
GMAC 7.500% 11/15/2017 22.50
GMAC 8.000% 11/15/2017 21.86
GMAC 8.125% 11/15/2017 20.50
GMAC 7.300% 12/15/2017 22.50
GMAC 7.400% 12/15/2017 15.41
GMAC 7.500% 12/15/2017 15.00
GMAC 7.300% 1/15/2018 15.90
GMAC 7.300% 1/15/2018 24.00
GMAC 7.000% 2/15/2018 10.50
GMAC 7.000% 2/15/2018 10.00
GMAC 6.750% 3/15/2018 19.81
GMAC 7.000% 3/15/2018 19.63
GMAC 7.050% 3/15/2018 18.50
GMAC 7.050% 3/15/2018 19.49
GMAC 7.050% 4/15/2018 18.00
GMAC 7.250% 4/15/2018 24.25
GMAC 7.250% 4/15/2018 20.00
GMAC 7.350% 4/15/2018 18.00
GMAC 7.375% 4/15/2018 22.00
GMAC 6.600% 5/15/2018 18.63
GMAC 7.000% 5/15/2018 20.00
GMAC 6.500% 6/15/2018 17.60
GMAC 6.650% 6/15/2018 19.50
GMAC 6.700% 6/15/2018 22.25
GMAC 6.700% 6/15/2018 14.00
GMAC 6.750% 7/15/2018 19.32
GMAC 6.875% 7/15/2018 15.17
GMAC 6.900% 7/15/2018 19.00
GMAC 6.900% 8/15/2018 15.14
GMAC 7.000% 8/15/2018 19.00
GMAC 7.250% 8/15/2018 20.71
GMAC 6.750% 9/15/2018 18.13
GMAC 6.800% 9/15/2018 14.80
GMAC 7.000% 9/15/2018 19.16
GMAC 7.150% 9/15/2018 19.50
GMAC 7.250% 9/15/2018 19.50
GMAC 6.650% 10/15/2018 15.25
GMAC 6.650% 10/15/2018 14.33
GMAC 6.750% 10/15/2018 18.08
GMAC 6.800% 10/15/2018 20.50
GMAC 6.700% 11/15/2018 18.05
GMAC 6.750% 11/15/2018 17.86
GMAC 6.250% 12/15/2018 19.00
GMAC 6.400% 12/15/2018 17.00
GMAC 6.500% 12/15/2018 16.00
GMAC 6.000% 2/15/2019 17.25
GMAC 6.000% 3/15/2019 12.50
GMAC 6.200% 4/15/2019 18.28
GMAC 6.350% 4/15/2019 16.00
GMAC 6.500% 5/15/2019 22.87
GMAC 6.750% 5/15/2019 17.00
GMAC 6.750% 5/15/2019 16.00
GMAC 6.600% 6/15/2019 21.51
GMAC 6.700% 6/15/2019 20.50
GMAC 6.750% 6/15/2019 10.68
GMAC 6.750% 6/15/2019 28.39
GMAC 6.250% 7/15/2019 24.35
GMAC 6.350% 7/15/2019 20.95
GMAC 6.350% 7/15/2019 20.95
GMAC 6.050% 8/15/2019 19.50
GMAC 6.150% 8/15/2019 19.50
GMAC 6.300% 8/15/2019 13.80
GMAC 6.300% 8/15/2019 21.00
GMAC 6.000% 9/15/2019 15.00
GMAC 6.000% 9/15/2019 19.90
GMAC 6.100% 9/15/2019 17.13
GMAC 6.150% 9/15/2019 18.50
GMAC 5.900% 10/15/2019 13.89
GMAC 6.050% 10/15/2019 21.87
GMAC 6.125% 10/15/2019 33.00
GMAC 6.150% 10/15/2019 17.00
GMAC 6.400% 11/15/2019 16.00
GMAC 6.400% 11/15/2019 19.50
GMAC 6.550% 12/15/2019 21.86
GMAC 6.550% 12/15/2019 17.80
GMAC 6.700% 12/15/2019 19.55
GMAC 6.500% 1/15/2020 15.00
GMAC 6.500% 2/15/2020 14.23
GMAC 9.000% 7/15/2020 20.00
GMAC 7.000% 9/15/2021 16.00
GMAC 7.000% 9/15/2021 21.00
GMAC 7.000% 6/15/2022 17.01
GMAC 7.000% 11/15/2023 17.50
GMAC 7.500% 3/15/2025 26.27
GMAC LLC 6.750% 7/15/2012 14.15
GMAC LLC 6.625% 5/15/2012 38.00
GMAC LLC 6.500% 5/15/2012 39.49
GMAC LLC 6.000% 12/15/2011 39.50
GMAC LLC 8.875% 6/1/2010 34.91
GMAC LLC 6.250% 6/15/2009 82.59
GMAC LLC 6.250% 5/15/2009 84.61
HARRAHS OPER CO 5.375% 12/15/2013 25.10
HARRAHS OPER CO 5.625% 6/1/2015 19.50
HARRAHS OPER CO 5.500% 7/1/2010 55.25
HAWAIIAN TELCOM 9.750% 5/1/2013 16.05
HAWAIIAN TELCOM 12.500% 5/1/2015 5.00
HERBST GAMING 7.000% 11/15/2014 6.00
HERBST GAMING 8.125% 6/1/2012 6.00
HINES NURSERIES 10.250% 10/1/2011 12.00
HOUSEHOLD FIN CO 4.125% 12/15/2008 99.25
HOUSEHOLD FIN CO 6.500% 11/15/2008 99.54
IDEARC INC 8.000% 11/15/2016 19.75
INN OF THE MOUNT 12.000% 11/15/2010 46.00
INTL LEASE FIN 5.150% 3/15/2010 60.26
INTL LEASE FIN 5.050% 3/15/2010 40.02
INTL LEASE FIN 4.875% 9/1/2010 65.40
INTL LEASE FIN 3.500% 4/1/2009 85.00
INTL LEASE FIN 5.600% 5/15/2009 70.00
INTL LEASE FIN 5.650% 6/15/2011 35.00
INTL LEASE FIN 6.375% 3/15/2009 93.00
ISOLAGEN INC 3.500% 11/1/2024 32.00
ISTAR FINANCIAL 5.800% 3/15/2011 46.75
ISTAR FINANCIAL 4.875% 1/15/2009 90.00
ISTAR FINANCIAL 6.000% 12/15/2010 47.75
JAZZ TECHNOLOGIE 8.000% 12/31/2011 40.00
K HOVNANIAN ENTR 6.000% 1/15/2010 59.75
KELLWOOD CO 7.875% 7/15/2009 65.00
KEMET CORP 2.250% 11/15/2026 34.22
KEMET CORP 2.250% 11/15/2026 36.38
KIMBALL HILL INC 10.500% 12/15/2012 2.33
KNIGHT RIDDER 7.125% 6/1/2011 50.00
LANDRY'S RESTAUR 9.500% 12/15/2014 73.50
LAZYDAYS RV 11.750% 5/15/2012 51.00
LEHMAN BROS HLDG 5.750% 1/3/2017 1.00
LEHMAN BROS HLDG 5.250% 3/8/2020 13.06
LEHMAN BROS HLDG 5.350% 3/13/2020 13.06
LEHMAN BROS HLDG 5.400% 3/20/2020 9.50
LEHMAN BROS HLDG 5.200% 5/13/2020 3.27
LEHMAN BROS HLDG 5.800% 9/3/2020 11.00
LEHMAN BROS HLDG 6.000% 1/29/2021 8.63
LEHMAN BROS HLDG 6.250% 2/5/2021 8.63
LEHMAN BROS HLDG 6.750% 7/1/2022 7.00
LEHMAN BROS HLDG 6.600% 10/3/2022 8.40
LEHMAN BROS HLDG 6.400% 10/11/2022 8.63
LEHMAN BROS HLDG 9.500% 1/30/2023 8.63
LEHMAN BROS HLDG 6.250% 2/22/2023 8.63
LEHMAN BROS HLDG 9.500% 2/27/2023 8.63
LEHMAN BROS HLDG 6.500% 2/28/2023 5.06
LEHMAN BROS HLDG 6.500% 3/6/2023 9.00
LEHMAN BROS HLDG 5.500% 3/14/2023 8.63
LEHMAN BROS HLDG 5.750% 3/27/2023 5.00
LEHMAN BROS HLDG 5.500% 4/8/2023 8.63
LEHMAN BROS HLDG 5.500% 4/15/2023 7.79
LEHMAN BROS HLDG 5.500% 4/23/2023 5.06
LEHMAN BROS HLDG 5.250% 5/20/2023 5.00
LEHMAN BROS HLDG 5.000% 5/30/2023 7.00
LEHMAN BROS HLDG 5.000% 6/10/2023 8.63
LEHMAN BROS HLDG 5.000% 6/17/2023 6.00
LEHMAN BROS HLDG 4.800% 6/24/2023 6.00
LEHMAN BROS HLDG 5.500% 8/5/2023 4.41
LEHMAN BROS HLDG 6.100% 8/12/2023 6.04
LEHMAN BROS HLDG 5.750% 9/16/2023 8.56
LEHMAN BROS HLDG 5.500% 10/7/2023 5.06
LEHMAN BROS HLDG 5.750% 10/15/2023 8.63
LEHMAN BROS HLDG 5.750% 10/21/2023 5.00
LEHMAN BROS HLDG 5.750% 11/12/2023 8.06
LEHMAN BROS HLDG 5.750% 11/25/2023 10.00
LEHMAN BROS HLDG 5.450% 3/15/2025 7.00
LEHMAN BROS HLDG 6.625% 7/27/2027 5.00
LEHMAN BROS HLDG 6.500% 9/20/2027 7.00
LEHMAN BROS HLDG 7.000% 9/27/2027 8.63
LEHMAN BROS HLDG 6.500% 10/18/2027 6.50
LEHMAN BROS HLDG 6.500% 10/25/2027 8.63
LEHMAN BROS HLDG 11.000% 3/17/2028 8.63
LEHMAN BROS HLDG 6.000% 10/23/2028 8.63
LEHMAN BROS HLDG 6.000% 11/18/2028 8.63
LEHMAN BROS HLDG 5.750% 12/16/2028 8.00
LEHMAN BROS HLDG 5.750% 12/23/2028 4.00
LEHMAN BROS HLDG 5.500% 1/27/2029 4.00
LEHMAN BROS HLDG 5.500% 2/3/2029 7.00
LEHMAN BROS HLDG 5.700% 2/10/2029 8.66
LEHMAN BROS HLDG 5.600% 2/17/2029 6.93
LEHMAN BROS HLDG 5.600% 2/24/2029 5.00
LEHMAN BROS HLDG 5.600% 3/2/2029 7.90
LEHMAN BROS HLDG 5.550% 3/9/2029 5.70
LEHMAN BROS HLDG 5.400% 3/30/2029 9.75
LEHMAN BROS HLDG 5.450% 4/6/2029 12.50
LEHMAN BROS HLDG 5.700% 4/13/2029 2.03
LEHMAN BROS HLDG 5.900% 5/4/2029 8.20
LEHMAN BROS HLDG 6.000% 5/11/2029 3.90
LEHMAN BROS HLDG 6.200% 5/25/2029 5.00
LEHMAN BROS HLDG 6.050% 6/29/2029 12.00
LEHMAN BROS HLDG 6.000% 7/20/2029 6.32
LEHMAN BROS HLDG 5.750% 8/24/2029 5.00
LEHMAN BROS HLDG 5.700% 9/7/2029 6.06
LEHMAN BROS HLDG 5.750% 9/14/2029 6.06
LEHMAN BROS HLDG 5.750% 10/12/2029 5.00
LEHMAN BROS HLDG 5.650% 11/23/2029 8.63
LEHMAN BROS HLDG 5.700% 12/14/2029 6.75
LEHMAN BROS HLDG 5.550% 1/25/2030 9.75
LEHMAN BROS HLDG 5.450% 2/22/2030 7.00
LEHMAN BROS HLDG 5.600% 2/25/2030 6.00
LEHMAN BROS HLDG 5.625% 3/15/2030 4.42
LEHMAN BROS HLDG 5.600% 5/3/2030 11.50
LEHMAN BROS HLDG 5.350% 6/14/2030 2.87
LEHMAN BROS HLDG 5.400% 6/21/2030 6.75
LEHMAN BROS HLDG 5.450% 7/19/2030 8.63
LEHMAN BROS HLDG 5.650% 8/16/2030 8.00
LEHMAN BROS HLDG 5.450% 9/20/2030 13.75
LEHMAN BROS HLDG 5.800% 10/25/2030 8.83
LEHMAN BROS HLDG 5.850% 11/8/2030 13.75
LEHMAN BROS HLDG 5.950% 12/20/2030 9.00
LEHMAN BROS HLDG 5.900% 2/7/2031 5.50
LEHMAN BROS HLDG 6.150% 4/11/2031 10.05
LEHMAN BROS HLDG 6.850% 8/16/2032 14.00
LEHMAN BROS HLDG 6.850% 8/23/2032 8.63
LEHMAN BROS HLDG 6.900% 9/1/2032 8.63
LEHMAN BROS HLDG 6.800% 9/7/2032 10.00
LEHMAN BROS HLDG 7.000% 10/4/2032 8.63
LEHMAN BROS HLDG 6.500% 11/15/2032 11.00
LEHMAN BROS HLDG 6.500% 1/17/2033 5.00
LEHMAN BROS HLDG 6.750% 3/11/2033 8.63
LEHMAN BROS HLDG 6.000% 4/30/2034 8.63
LEHMAN BROS HLDG 6.000% 7/30/2034 8.63
LEHMAN BROS HLDG 5.550% 12/31/2034 7.83
LEHMAN BROS HLDG 5.650% 12/31/2034 8.20
LEHMAN BROS HLDG 6.000% 2/21/2036 8.90
LEHMAN BROS HLDG 6.000% 2/24/2036 5.70
LEHMAN BROS HLDG 6.900% 6/20/2036 8.50
LEHMAN BROS HLDG 6.400% 12/19/2036 9.00
LEHMAN BROS HLDG 6.500% 12/22/2036 7.56
LEHMAN BROS HLDG 6.000% 2/12/2037 10.50
LEHMAN BROS HLDG 6.500% 2/13/2037 10.00
LEHMAN BROS HLDG 6.300% 3/27/2037 14.00
LEHMAN BROS HLDG 6.500% 6/21/2037 8.90
LEHMAN BROS HLDG 6.500% 7/13/2037 4.88
LEHMAN BROS HLDG 7.000% 7/27/2037 8.63
LEHMAN BROS HLDG 7.000% 9/28/2037 8.63
LEHMAN BROS HLDG 6.750% 10/26/2037 7.48
LEHMAN BROS HLDG 7.000% 11/16/2037 8.63
LEHMAN BROS HLDG 7.000% 12/28/2037 4.00
LEHMAN BROS HLDG 7.000% 1/31/2038 8.63
LEHMAN BROS HLDG 7.000% 2/1/2038 8.63
LEHMAN BROS HLDG 7.000% 2/8/2038 8.63
LEHMAN BROS HLDG 7.050% 2/27/2038 5.17
LEHMAN BROS HLDG 7.250% 2/27/2038 11.50
LEHMAN BROS HLDG 7.100% 3/25/2038 9.00
LEHMAN BROS HLDG 7.000% 4/22/2038 5.04
LEHMAN BROS HLDG 7.250% 4/29/2038 13.85
LEHMAN BROS HLDG 7.350% 5/6/2038 10.00
LEHMAN BROS HLDG 4.000% 8/3/2009 10.00
LEHMAN BROS HLDG 7.200% 8/15/2009 7.75
LEHMAN BROS HLDG 7.875% 11/1/2009 8.63
LEHMAN BROS HLDG 3.950% 11/10/2009 8.25
LEHMAN BROS HLDG 4.250% 1/27/2010 8.30
LEHMAN BROS HLDG 4.500% 7/26/2010 8.63
LEHMAN BROS HLDG 7.875% 8/15/2010 8.63
LEHMAN BROS HLDG 4.375% 11/30/2010 8.50
LEHMAN BROS HLDG 5.000% 1/14/2011 7.75
LEHMAN BROS HLDG 6.000% 4/1/2011 12.00
LEHMAN BROS HLDG 5.750% 4/25/2011 7.25
LEHMAN BROS HLDG 5.750% 7/18/2011 8.63
LEHMAN BROS HLDG 4.500% 8/3/2011 7.00
LEHMAN BROS HLDG 6.625% 1/18/2012 8.63
LEHMAN BROS HLDG 5.250% 2/6/2012 7.80
LEHMAN BROS HLDG 6.000% 7/19/2012 8.63
LEHMAN BROS HLDG 5.000% 1/22/2013 6.06
LEHMAN BROS HLDG 5.625% 1/24/2013 8.63
LEHMAN BROS HLDG 5.100% 1/28/2013 7.00
LEHMAN BROS HLDG 5.000% 2/11/2013 13.00
LEHMAN BROS HLDG 4.800% 2/27/2013 8.50
LEHMAN BROS HLDG 4.700% 3/6/2013 5.20
LEHMAN BROS HLDG 5.000% 3/27/2013 6.06
LEHMAN BROS HLDG 5.750% 5/17/2013 8.63
LEHMAN BROS HLDG 5.250% 1/30/2014 20.00
LEHMAN BROS HLDG 4.800% 3/13/2014 8.63
LEHMAN BROS HLDG 5.000% 8/3/2014 8.25
LEHMAN BROS HLDG 6.200% 9/26/2014 10.75
LEHMAN BROS HLDG 5.150% 2/4/2015 4.00
LEHMAN BROS HLDG 5.250% 2/11/2015 13.50
LEHMAN BROS HLDG 8.800% 3/1/2015 8.63
LEHMAN BROS HLDG 8.500% 8/1/2015 8.63
LEHMAN BROS HLDG 5.000% 8/5/2015 8.00
LEHMAN BROS HLDG 5.000% 12/18/2015 8.63
LEHMAN BROS HLDG 5.500% 4/4/2016 8.63
LEHMAN BROS HLDG 8.920% 2/16/2017 17.50
LEHMAN BROS HLDG 6.500% 7/19/2017 1.00
LEHMAN BROS HLDG 11.000% 10/25/2017 10.00
LEHMAN BROS HLDG 5.875% 11/15/2017 9.00
LEHMAN BROS HLDG 6.750% 12/28/2017 0.19
LEHMAN BROS HLDG 5.600% 1/22/2018 8.00
LEHMAN BROS HLDG 5.700% 1/28/2018 5.06
LEHMAN BROS HLDG 5.500% 2/4/2018 8.63
LEHMAN BROS HLDG 5.550% 2/11/2018 6.00
LEHMAN BROS HLDG 5.500% 2/19/2018 6.06
LEHMAN BROS HLDG 5.350% 2/25/2018 12.00
LEHMAN BROS HLDG 6.875% 5/2/2018 11.88
LEHMAN BROS HLDG 5.500% 11/4/2018 7.00
LEHMAN BROS HLDG 8.050% 1/15/2019 8.63
LEHMAN BROS HLDG 4.000% 4/16/2019 7.75
LEHMAN BROS HLDG 6.000% 1/22/2020 8.90
LEHMAN BROS HLDG 6.000% 2/12/2020 4.00
LEHMAN BROS HLDG 5.100% 2/15/2020 4.13
LEHMAN BROS HLDG 5.500% 2/27/2020 2.50
LEHMAN BROS HLDG 5.400% 3/6/2020 8.63
LEHMAN BROS INC 7.500% 8/1/2026 8.63
LEINER HEALTH 11.000% 6/1/2012 21.00
LEVEL 3 COMM INC 2.875% 7/15/2010 19.50
LIBERTY FINL 6.750% 11/15/2008 97.00
LITHIA MOTORS 2.875% 5/1/2014 81.00
MAGNA ENTERTAINM 8.550% 6/15/2010 46.20
MAGNA ENTERTAINM 7.250% 12/15/2009 51.00
MAJESTIC STAR 9.500% 10/15/2010 36.75
MAJESTIC STAR 9.750% 1/15/2011 10.00
MASONITE CORP 11.000% 4/6/2015 9.94
METALDYNE CORP 11.000% 6/15/2012 4.00
METALDYNE CORP 10.000% 11/1/2013 16.00
MORGAN ST DEAN W 1.250% 12/30/2008 74.25
MORRIS PUBLISH 7.000% 8/1/2013 9.75
MRS FIELDS 11.500% 3/15/2011 51.00
MUZAK LLC 9.875% 3/15/2009 95.00
MUZAK LLC/FIN 10.000% 2/15/2009 85.00
NATL CITY BANK 2.700% 8/24/2009 70.96
NATL CITY BANK 4.625% 5/1/2013 59.75
NATL CITY BK PA 7.250% 10/21/2011 39.00
NATL CITY CORP 5.750% 2/1/2009 86.10
NATL CITY CORP 3.125% 4/30/2009 90.00
NEFF CORP 10.000% 6/1/2015 18.00
NEW PLAN EXCEL 7.400% 9/15/2009 44.00
NEWARK GROUP INC 9.750% 3/15/2014 30.00
NORTH ATL TRADNG 9.250% 3/1/2012 38.03
NTK HOLDINGS INC 0.000% 3/1/2014 35.00
NUTRITIONAL SRC 10.125% 8/1/2009 21.50
OSCIENT PHARM 3.500% 4/15/2011 8.75
OSCIENT PHARM 3.500% 4/15/2011 25.75
OSI RESTAURANT 10.000% 6/15/2015 25.00
PALM HARBOR 3.250% 5/15/2024 40.38
PARK PLACE ENT 8.125% 5/15/2011 39.50
PARK PLACE ENT 7.875% 3/15/2010 56.75
PIERRE FOODS INC 9.875% 7/15/2012 7.88
PINNACLE AIRLINE 3.250% 2/15/2025 65.75
PLIANT CORP 11.125% 9/1/2009 49.00
PLY GEM INDS 9.000% 2/15/2012 41.00
PRIMUS TELECOM 3.750% 9/15/2010 51.75
PRIMUS TELECOM 12.750% 10/15/2009 73.00
PRIMUS TELECOM 8.000% 1/15/2014 24.00
QUALITY DISTRIBU 9.000% 11/15/2010 55.80
RADIAN GROUP 7.750% 6/1/2011 44.00
RAFAELLA APPAREL 11.250% 6/15/2011 38.75
REALOGY CORP 10.500% 4/15/2014 26.50
REALOGY CORP 12.375% 4/15/2015 19.00
RESIDENTIAL CAP 8.000% 2/22/2011 14.00
RESIDENTIAL CAP 8.125% 11/21/2008 83.75
RESIDENTIAL CAP 8.375% 6/30/2010 17.00
RESIDENTIAL CAP 8.500% 6/1/2012 14.00
RESIDENTIAL CAP 8.500% 4/17/2013 10.00
RESIDENTIAL CAP 8.875% 6/30/2015 21.00
RH DONNELLEY 8.875% 1/15/2016 21.94
RH DONNELLEY 8.875% 10/15/2017 22.25
RH DONNELLEY 6.875% 1/15/2013 31.50
RH DONNELLEY 6.875% 1/15/2013 24.50
RITE AID CORP 6.875% 8/15/2013 35.00
RITE AID CORP 8.625% 3/1/2015 32.94
RITE AID CORP 7.700% 2/15/2027 20.00
RJ TOWER CORP 12.000% 6/1/2013 1.13
ROUSE COMPANY 8.000% 4/30/2009 69.94
ROUSE COMPANY 3.625% 3/15/2009 59.80
SEARS ROEBUCK AC 7.500% 1/15/2013 32.25
SECURUS TECH 11.000% 9/1/2011 52.00
SIRIUS SATELLITE 2.500% 2/15/2009 82.88
SIX FLAGS INC 9.625% 6/1/2014 30.00
SIX FLAGS INC 9.750% 4/15/2013 33.00
SLM CORP 4.200% 9/15/2010 50.11
SLM CORP 4.000% 1/15/2009 95.00
SPECTRUM BRANDS 7.375% 2/1/2015 30.50
STANLEY-MARTIN 9.750% 8/15/2015 25.00
STATION CASINOS 6.625% 3/15/2018 12.75
STATION CASINOS 6.000% 4/1/2012 35.50
STATION CASINOS 6.875% 3/1/2016 13.75
STATION CASINOS 6.500% 2/1/2014 13.50
SWIFT TRANS CO 12.500% 5/15/2017 #N/A N.
TEKNI-PLEX INC 12.750% 6/15/2010 65.00
TIMES MIRROR CO 7.250% 3/1/2013 24.00
TOUSA INC 9.000% 7/1/2010 16.00
TOUSA INC 7.500% 3/15/2011 2.25
TOUSA INC 7.500% 1/15/2015 0.88
TOUSA INC 9.000% 7/1/2010 14.88
TOUSA INC 10.375% 7/1/2012 2.25
TRIBUNE CO 5.670% 12/8/2008 94.00
TRIBUNE CO 5.250% 8/15/2015 16.25
TRIBUNE CO 4.875% 8/15/2010 40.00
TRONOX WORLDWIDE 9.500% 12/1/2012 26.25
TRUE TEMPER 8.375% 9/15/2011 29.80
TRUMP ENTERTNMNT 8.500% 6/1/2015 21.40
UAL CORP 5.000% 2/1/2021 41.51
UAL CORP 4.500% 6/30/2021 43.32
US AIRWAYS GROUP 7.000% 9/30/2020 59.00
VERASUN ENERGY 9.875% 12/15/2012 57.25
VERENIUM CORP 5.500% 4/1/2027 38.00
VERTIS INC 9.750% 4/1/2009 79.13
VESTA INSUR GRP 8.750% 7/15/2025 1.00
VICORP RESTAURNT 10.500% 4/15/2011 6.75
VION PHARM INC 7.750% 2/15/2012 22.50
VISTEON CORP 7.000% 3/10/2014 14.00
VISTEON CORP 8.250% 8/1/2010 35.00
WASH MUT BANK NV 5.650% 8/15/2014 0.25
WASH MUT BANK NV 5.550% 6/16/2010 28.50
WASH MUTUAL INC 4.625% 4/1/2014 16.03
WASH MUTUAL INC 4.000% 1/15/2009 69.00
WASH MUTUAL INC 4.200% 1/15/2010 66.50
WASH MUTUAL INC 7.250% 11/1/2017 16.50
WASH MUTUAL INC 8.250% 4/1/2010 16.00
WCI COMMUNITIES 9.125% 5/1/2012 21.25
WILLIAM LYON 10.750% 4/1/2013 29.85
WIMAR OP LLC/FIN 9.625% 12/15/2014 4.00
WOLVERINE TUBE 10.500% 4/1/2009 89.00
XM SATELLITE 10.000% 12/1/2009 46.88
YOUNG BROADCSTNG 8.750% 1/15/2014 15.00
YOUNG BROADCSTNG 10.000% 3/1/2011 10.00
*********
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. 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,
Carlo Fernandez, 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 ***