/raid1/www/Hosts/bankrupt/TCR_Public/090601.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, June 1, 2009, Vol. 13, No. 150
Headlines
ABITIBIBOWATER INC: Aurelius Objects to Fairfax DIP Facility
AFC ENTERPRISES: April 19 Balance Sheet Upside-Down by $33.5MM
AL BASKIN: JOB Investments to Provide Up to $2MM in DIP Financing
ALISO VIEGJO: S&P Assigns 'B+' Rating on $300 Mil. Senior Notes
ALLIS-CHALMERS: Issues to Stockholders Rights to Buy 35.7MM Shares
AMC ENTERTAINMENT: Fitch Assigns 'B/RR4' Rating on Senior Notes
AMC ENTERTAINMENT: S&P Affirms 'B-' Rating on $600 Mil. Notes
AMC ENTERTAINMENT: Notes Offering Increased to $600 Million
AMERICAN NATURAL: Mulls Offering of 30MM Shares of Common Stock
ANCHOR BLUE: Selling 73 Outlet Stores to Levi Strauss
ANEKONA W: Files for Chapter 11 Bankruptcy Protection
ARCLIN CANADA: Moody's Downgrades Corp. Family Rating to 'Caa3'
ATLANTIC BROADBAND: S&P Affirms Corporate Credit Rating at 'B+'
AVENTINE RENEWABLE: Abandons Recapitalization Efforts, Seeks Sale
AVENTINE RENEWABLE: Panel Wants to Tap Greenberg & Jefferies Firms
AVIS BUDGET: Obtains $325 Million Operating Lease Financing
BANK OF AMERICA: Temple Sloan Leaves Board of Directors
BANKUNITED FINANCIAL: Receives Notice of Delisting from NASDAQ
BEARINGPOINT INC: Acquisition by PricewaterhouseCoopers Okayed
BIOFUEL ENERGY: Receives Notice of Default From Lenders
BRIGHAM EXPLORATION: S&P Affirms 'CCC+' Corporate Credit Rating
CAPROCK COMMUNICATIONS: Moody's Affirms 'B2' Corp. Family Rating
CATHAY GENERAL: Fitch Puts 'BB+' Stock Rating on Negative Watch
CCS INC: S&P Junks Senior Unsecured & Subordinated Ratings
CELESTICA INC: Moody's Affirms Corporate Family Rating at 'B1'
CHECKER MOTORS: Narmco Group May Acquire Firm for $1.6 Million
CHRYSLER LLC: Court Ruling on Asset Sale to Fiat Expected Today
CHRYSLER LLC: District Court Denies Motion to Withdraw Reference
CITADEL BROADCASTING: Herbert J. Siegel Resigns From Board
CITADEL BROADCASTING: S&P Downgrades Corp. Credit Rating to 'CCC'
COBALIS CORP: Inks Pact With Int'l Shipping for Sale of PreHistin
COEUR D'ALENE: Completes 1-for-10 Reverse Stock Split
COLONIAL BANCGROUP: Robert Lowder Retires as Chairman, CEO, Pres.
COLUMBUS ACQUISITION: Board Approves Liquidation & Dissolution
COMSTOCK HOMEBUILDING: Appoints CAO Jeff Dauer as Interim CFO
CONTECH US: Amends Accommodation Pact with Delphi, Ford
CRICKET COMMUNICATIONS: Moody's Assigns 'Ba2' Rating on Notes
CRICKET COMMUNICATIONS: S&P Assigns 'B+' Rating on $1.1 Bil. Notes
DBO HOLDINGS: S&P Downgrades Corporate Credit Rating to 'B'
DBSD NORTH AMERICA: Can Use Cash Collateral on Interim Basis
DBSD NORTH AMERICA: Taps Jefferies & Company as Investment Banker
DBSD NORTH AMERICA: Wants to Hire Kirkland & Ellis as Attorney
DELPHI CORP: General Motors Considering Purchase of 5 Plants
ELDERCARE PROPERTIES: Insurance Hiccups Didn't Terminate Lease
ENRON CORP: Court Okays Arthur Andersen Settlement for $16 Million
ENRON CORP: Deutsche Bank Seeks Reconsideration of Settlement
ENRON CORP: Creditors Panel Settles $2.6MM Lou Pai Suit for $300K
ENRON CORP: Court Okays Piper Jaffray & DISH Network Settlement
FLEETWOOD ENTERPRISES: Craig Little May Bid for Pendleton Property
FLEETWOOD ENTERPRISES: Sells Trendsetter Housing to CMH for $4.5MM
FORD MOTOR: Finance Arm Sells $1.1 Billion in Five-Year Notes
FRONTIER AIRLINES: Posts $248.2MM Net Loss in Year Ended March 31
FRONTIER AIRLINES: Wants to End Employee Stock Ownership Plan
FRONTIER AIRLINES: Can Perform Under Amended WestLB Agreements
FRONTIER AIRLINES: Addresses U.S. Trustee's Objections to Fees
FURNITURE-IN-PARTS: Files for Chapter 11 Bankruptcy Protection
GENERAL MOTORS: Filing Chapter 11 Petitions Today
GENERAL MOTORS: Will Identify 14 Plants to be Shut Down
GENTA INC: Postpones Meeting of Stockholders on Securities Deal
GEORGIA GULF: Executives Elect to Forfeit Options to Buy Shares
GLOBAL GREENERY: Equity Receiver Can't Assert Creditors' Claims
GOTTSCHALKS INC: Forever 21 Wins Firm's 12 Leased Locations
GREATER ATLANTIC: Banking Unit Consents Appointment of Conservator
HARRAH'S ENTERTAINMENT: Two Units Propose $1 Bil. Debt Offering
HARTMARX CORP: Wells Fargo Opposes Emerisque's Offer for Firm
HCA INC: Earns $902 Million for Year Ended December 31
HDGIANTS INC: Files for Chapter 11 Bankruptcy Protection
HERBST GAMING: In Talks With Lenders to Extend Lockup Agreement
INDYMAC FEDERAL: Creditors Have Until August 26 to File Claims
INTERFACE INC: Moody's Assigns 'B1' Rating on Senior Notes
INTERFACE INC: S&P Assigns 'BB-' Rating on $150 Mil. Senior Notes
ISTAR FINANCIAL: S&P Downgrades Senior Unsecured Rating to 'BB-'
LEVI STRAUSS: Names Blake Jorgensen as New CFO & EVP
LEVIS STRAUSS: To Acquire 73 Outlet Stores of Anchor Blue
LITHIUM TECHNOLOGY: Sept. 30 Balance Sheet Upside-Down by $9MM
LYONDELLBASELL: Andreas Heeschen Acquires 50% Equity Stake
LYONDELL CHEMICAL: Veolia ES Removed From Creditors' Committee
LYONDELL CHEMICAL: Seeks to Deliver $15.3MM LOC to Sumitomo
LYONDELL CHEMICAL: Court Sets June 30 as New Claims Bar Date
LYONDELL CHEMICAL: LBI & GP Units File Schedules & Statements
MACY'S INC: Toy R Us Acquires FAO Schwarz & Will Close 260 Outlets
MAHALO ENERGY: Files for CCAA Protection
MAHALO USA: Files for Chapter 11 Bankruptcy Protection
MERUELO MADDUX: Bofa Objects to Compensation Plan for Executives
METALDYNE CORP: S&P Downgrades Corporate Credit Rating to 'D'
METALDYNE CORP: Wants Jones Day as Bankruptcy Counsel
METALDYNE CORP: Wants Schedules Filing Extended Until July 13
MIDWAY GAMES: Discloses Timeframe for Section 363 Sale Process
MOMENTIVE PERFORMANCE: Reports $515 Million Old Notes Tendered
NASH FINCH: S&P Raises Corporate Credit Rating to 'BB-'
NEVIS NETWORKS: Files for Chapter 7 Bankruptcy Protection
NM HOLDINGS: Trustee's Suit Against Deloitte is Dismissed
NOBLE INTERNATIONAL: Names McCracken as CEO After Tavi Resigns
NOVASTAR FINANCIAL: Deloitte Raises Going Concern Doubt
OILEXCO NORTH: S.D.N.Y. Court Approves Chapter 15 Petition
PAPER INTERNATIONAL: Plan Filing Period Extended to September 30
PHILIPS-VAN HEUSEN: Moody's Affirms 'Ba2' Corporate Family Rating
PRIDE INTERNATIONAL: Fitch Assigns 'BB+' Rating on $500 Mil. Notes
PRIDE INTERNATIONAL: Moody's Assigns 'Ba1' Senior Unsec. Rating
RADIATION THERAPY: S&P Puts 'B+' Rating on CreditWatch Negative
RAILPOWER TECHNOLOGIES: Files 5th Default Status Report
REDCORP VENTURES: Ken Lowe & Mike Bardell Leave Firm
REDCORP VENTURES: McIntosh & Morawetz Appointed as Receiver
R.H. DONNELLEY: Case Summary & 30 Largest Unsecured Creditors
R.H. DONNELLEY: Expects to Exit Chapter 11 in Early January 2010
R.H. DONNELLEY: Seeks Extension of Schedules Filing
SAINTS MEDICAL: Fitch Puts 'BB+' Rating on Positive Watch
SEMGROUP ENERGY: Earns $59,000 for Three Months Ended September 30
SEMGROUP LP: Seeks to Assume & Assign Thru-Put Pact to Irving Oil
SEMGROUP LP: Producers' Panel Balks at Russell Reynolds Engagement
SEMGROUP LP: Creditors' Panel Renews Rule 2004 Discovery Request
SEMGROUP LP: BDO Seidman Bills $2.4MM for March & April Services
SENCORP: Moves to Sell Assets; Gets $41 Mil. Bid From Wynnchurch
SENCORP: Section 341(a) Meeting Scheduled for June 18
SENCORP: U.S. Trustee Forms Five-Member Creditors' Committee
SHELDON GOOD: To Present Financing Pact With Cuticelli to Court
SOURCE INTERLINK: Court Confirms Pre-Packaged Chapter 11 Plan
STANADYNE HOLDINGS: Moody's Junks Corporate Family Rating
STATION CASINOS: Dodges Ch 11, Gets 4th Extension From Bondholders
TARRAGON CORP: Seeks Approval of KEIP for 8 Dallas Employees
TENNECO INC: S&P Assigns 'B-' Rating on Senior Unsecured Debt
TEREX CORPORATION: Moody's Affirms 'B2' Corporate Family Rating
TERRA NOSTRA: Court Approves Disclosure Statement
TIERRA DEL SOL: Files for Chapter 11 Bankruptcy Protection
TOYS R US: Acquires FAO Schwarz, To Takeover Fifth Avenue Store
TREY RESOURCES: Buys 20% of SWK Technologies Stock for $150,000
TRINITY INDUSTRIES: S&P Gives Stable Outlook; Affirms 'BB+' Rating
TRONOX INC: Seeks to Retain ATL as Property Tax Consultant
VERSO PAPER: S&P Downgrades Corporate Credit Rating to 'B-'
VIANT HOLDINGS: S&P Affirms Counterparty Credit Rating at 'B'
VISTEON CORP: Chapter 11 Filing Cues Fitch's 'D' Rating
VISTEON CORP: Chapter 11 Filing Cues Moody's 'D' Rating
VISTEON CORP: S&P Downgrades Corporate Credit Rating to 'D'
VISTEON CORP: Court Grants Interim Okay to Use Cash Collateral
VISTEON CORP: Seeks to Employ Pachulski Stang as Local Counsel
VISTEON CORP: Modifies Credit Agreement With Ford Motor
WILLIAM LYON: Unit Extends Senior Notes Tender Offer to June 5
WISE METALS: December 31 Balance Sheet Upside-Down by $266MM
* Barry N. Seidel Joins Butzel Long as Shareholder
* Seven Lawyers From Kirkland & Ellis Join Jones Day
* BOND PRICING -- For the Week From May 18 to 22, 2009
*********
ABITIBIBOWATER INC: Aurelius Objects to Fairfax DIP Facility
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Aurelius Capital Management LP, objects to the final approval of
AbitibiBowater Inc., et al.'s proposed $600 million DIP financing
from Fairfax Financial Holdings Ltd., Avenue Investments, L.P.,
and certain other lenders.
Aurelius, through its managed funded entities, is a holder of the
unsecured notes (due 2011) issued by Bowater Canada Finance Corp.
in 2001. The 2011 Notes have an aggregate face value of
$600 million and is supported by a guarantee from Bowater
Incorporated. Aurelius says that under the proposed DIP Facility,
BCFC would guarantee and secure all Canadian borrowings, though it
has minimal, if any, cash needs and would receive no direct
economic benefit from any of those borrowings. Aurelius also said
that that BCFC does not appear to require direct financing in
order to maintain the value of its assets, and that the DIP motion
provides adequate protection to the prepetition lienholders even
though they are unaffected by the DIP Facility and already have a
sufficient equity cushion to protect them in the event of a
decline in value of their collateral.
As reported in the Troubled Company Reporter on April 23, 2009,
the Debtors sought and obtained permission from the U.S.
Bankruptcy Court for the District of Delaware, on an interim
basis, to borrow up to $206 million from Fairfax Financial
Holdings Ltd., Avenue Investments, L.P., and certain lenders. The
Interim DIP Loan consists of a $166 million term loan for
AbitibiBowater Inc. and Bowater Inc. and a $40 million term loan
for Bowater Canada Forest Products Inc.
The DIP Facility can be upsized to $600 million upon the entry of
a final DIP order under an incremental term loan and an asset
backed revolving credit facility.
About AbitibiBowater Inc.
Headquartered in Montreal, Canada, AbitibiBowater Inc. --
http://www.abitibibowater.com/-- produces a wide range of
newsprint, commercial printing papers, market pulp and wood
products. It is the eighth largest publicly traded pulp and paper
manufacturer in the world. AbitibiBowater owns or operates 27
pulp and paper facilities and 34 wood products facilities located
in the United States, Canada, the United Kingdom and South Korea.
Marketing its products in more than 90 countries, the Company is
also among the world's largest recyclers of old newspapers and
magazines, and has more third-party certified sustainable forest
land than any other company in the world.
Out-of-Court Restructuring Effort
AbitibiBowater tried to renegotiate about $2.9 billion in the
debts of its Canadian unit, Abitibi-Consolidated, and
$1.8 billion of its U.S. unit, Bowater Inc. On March 13,
AbitibiBowater and Abitibi-Consolidated commenced a
recapitalization proposal which was intended to reduce the
Company's net debt by roughly $2.4 billion, lower its annual
interest expense by roughly $162 million and raise roughly
$350 million through the issuance of new notes of ACI and common
stock and warrants of the Company.
On February 9, Bowater Finance II LLC, an indirect wholly owned
subsidiary of AbitibiBowater, commenced private offers with
respect to six series of outstanding debt securities issued by
either Bowater Incorporated or Bowater Canada Finance Corporation,
a wholly owned subsidiary of Bowater, to exchange the old notes
for new notes. BowFin also intended for a concurrent private
offering of new 15.5% First Lien Notes due November 15, 2011, to
holders of Bowater Notes who tender notes in the exchange offers.
The Company moved the exchange offer deadlines several times after
failing to garner enough support from bondholders. It ultimately
abandoned the exchange offer on March 31.
Bankruptcy Filing
The Company and several affiliates filed for protection under
Chapter 11 of the U.S. Bankruptcy Code on April 16, 2009 (Bankr.
D. Del. Lead Case No. 09-11296). Judge Kevin J. Carey presides
over the case. The Company and its Canadian affiliates commenced
parallel restructuring proceedings under the Companies' Creditors
Arrangement Act before the Quebec Superior Court Commercial
Division the next day. Alex F. Morrison at Ernst & Young, Inc.,
was appointed CCAA monitor.
Paul, Weiss, Rifkind, Wharton & Garrison LLP, serves as the
Debtors' U.S. bankruptcy counsel. Stikeman Elliot LLP, acts as
the Debtors' CCAA counsel. Young, Conaway, Stargatt & Taylor, in
Wilmington, Delaware, serves as the Debtors' co-counsel, while
Troutman Sanders LLP in New York, serves as the Debtors' conflicts
counsel in the Chapter 11 proceedings. The Debtors' financial
advisors are Advisory Services LP, and their noticing and claims
agent is Epiq Bankruptcy Solutions LLC. The CCAA Monitor's
counsel is Thornton, Grout & Finnigan LLP, in Toronto, Ontario.
Abitibi-Consolidated Inc. and various Canadian subsidiaries filed
for protection under Chapter 15 of the U.S. Bankruptcy Code on
April 17, 2009 (Bankr. D. Del. 09-11348). Judge Carey also handles
the Chapter 15 case. Pauline K. Morgan, Esq., and Sean T.
Greecher, Esq., at Young, Conaway, Stargatt & Taylor, in
Wilmington, represent the Chapter 15 Debtors.
As of September 30, 2008, the Company had $9,937,000,000 in total
assets and $8,783,000,000 in total debts.
Bankruptcy Creditors' Service, Inc., publishes Abitibibowater
Bankruptcy News. The newsletter provides gavel-to-gavel coverage
of the Chapter 11 proceedings and parallel proceedings under the
Companies' Creditors Arrangement Act in Canada undertaken by
Abitibibowater Inc. and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).
AFC ENTERPRISES: April 19 Balance Sheet Upside-Down by $33.5MM
--------------------------------------------------------------
AFC Enterprises, Inc., filed with the Securities and Exchange
Commission its financial results for the quarter ended April 19,
2009.
For the quarter ended April 19, 2009, the Company's balance sheet
showed total assets of $131.0 million and total liabilities of
$164.5 million, resulting in a shareholders' deficit of
$33.5 million.
For the 16 weeks ended April 19, 2009, the Company reported net
income of $5.0 million compared with $6.4 million for the same
period in the previous year.
Liquidity and Capital Resources
The Company's cash flows and available borrowings enable the
Company to pursue its growth strategies. The Company's priorities
in the use of available cash are:
-- reinvestment in its core business activities that promote
the Company's strategic initiatives;
-- reduction of long-term debt; and
-- repurchase shares of its common stock.
The Company's investment in core business activities includes its
obligation to maintain its Company-operated restaurants and
provide marketing plans and operations support to its franchise
system.
During the first quarter of 2009, the Company paid principal on
term loan borrowing in the amount of $3.4 million, including
$2.8 million of mandatory prepayments from the fiscal 2008
Consolidated Excess Cash Flow, and paid $0.5 million under the
2005 revolving credit facility. As of April 19, 2009, there were
no amounts outstanding under the revolving credit facility.
During 2009, the Company intends to continue to use cash realized
from operations and the proceeds from sales of selected restaurant
properties to make voluntary debt prepayments to secure compliance
with the Total Leverage Ratio requirement.
Future debt maturities under the 2005 Credit Facility include four
designated quarterly payments of approximately 1/4 of the
outstanding principal, beginning in the third quarter of 2010.
The Company intends to amend or refinance the 2005 Credit Facility
in advance of these maturities at a cost and interest rate that
reflect market conditions.
The Company did not repurchase any shares of its common stock
during the first quarter of 2009. As of April 19, 2009, the
remaining value of shares that may be repurchased under the
Company's current share repurchase program was approximately
$38.9 million. Pursuant to the terms of the Company?s 2005 Credit
Facility, the Company is subject to a repurchase limit of
approximately $27.6 million for the remainder of 2009.
A full-text copy of the Company's 10Q filing is available for free
at http://ResearchArchives.com/t/s?3d67
About AFC Enterprises Inc.
Headquartered in Atlanta, Georgia, AFC Enterprises Inc. (Nasdaq:
AFCE) -- http://www.afce.com/-- is the franchisor and operator of
Popeyes(R) restaurants. As of July 13, 2008, Popeyes had 1,901
restaurants in the United States, Puerto Rico, Guam and 25 foreign
countries.
AL BASKIN: JOB Investments to Provide Up to $2MM in DIP Financing
-----------------------------------------------------------------
JOB Investments LLC will provide up to $2 million in debtor-in-
possession financing to Al Baskin Co., dba Mark Shale, until
September 30, 2009, court documents say.
The loan, according to court documents, will be used to acquire
new inventory, fund payroll, and help pay down $1.6 million in
debt from Bank of America NA, which together with LaSalle Bank
lent Al Baskin some $5.2 million. Sandra M. Jones at Chicago
Tribune relates that Al Baskin used the proceeds from going-out-of
business sales at its Elston Avenue outlet and four out-of-state
stores to pay down the bank debt. Al Baskin might end up being
liquidated without the DIP loan, Chicago Tribune states.
Chicago Tribune says that JOB Investments may buy Al Baskin. JOB
Investments, according to court documents, has until June 5 to
submit an offer for Al Baskin.
Woodridge, Illinois-based Al Baskin Co., dba Mark Shale, filed for
Chapter 11 bankruptcy protection on March 23, 2008 (Bankr. N.D.
Ill. Case No. 09-09825). Adam P. Silverman, Esq., at Adelman &
Gettleman, Ltd., assists the Company in its restructuring efforts.
The Company listed $1 million to $10 million in assets and
$10 million to $50 million in debts.
ALISO VIEGJO: S&P Assigns 'B+' Rating on $300 Mil. Senior Notes
---------------------------------------------------------------
Standard & Poor's Ratings Services said that it has assigned a
rating of 'B+', and a '3' recovery rating to Aliso Viejo,
California-based Valeant Pharmaceuticals International's new
$300 million senior unsecured notes maturing 2016. At the same
time, S&P lowered the company's subordinated 3% and 4% convertible
notes to 'B-' from 'B+'. S&P also revised Valeant's outlook to
positive. Its corporate credit rating remains 'B+'.
"The rating action on the company's subordinated 3% and 4%
convertible notes to 'B-' from 'B+' reflects their subordination
in the capital structure to Valeant's new $350 million senior
unsecured notes," said Standard & Poor's credit analyst Brian
Jones. Separately, but concurrently, S&P revised Valeant's
outlook to positive to reflect its improved cash flow generation
and operating performance resulting from recent restructuring
initiatives. S&P believes the company is taking prudent steps to
refocus its product portfolio. Combined with effective cost
control, the company has demonstrated improved cash flow
generation and a solid base business on which to execute its
growth strategy.
S&P's ratings on specialty pharmaceutical company Valeant reflect
product and pipeline setbacks that have required the company to
make substantial management and operational changes over the past
two years. The need to replace lost revenue streams through
acquisitions and a weak internal R&D program continue to outweigh
Valeant's diverse portfolio and adequate liquidity.
Valeant manufactures and distributes a wide range of
pharmaceutical products globally. Through its recent
restructuring activities, the company has refocused its product
portfolio on its dermatology and neurology franchises and narrowed
its geographic footprint. Recent developments include a
partnership with GlaxoSmithKline on the development and
commercialization of retigabine (epilepsy); a string of
acquisitions including EMO-FARM Ltd. ($28 million), Dow
Pharmaceuticals ($285 million), and Coria Laboratories
($95 million); overhaul of its Mexico operations; and the sale of
its Western and Eastern Europe, Middle East, and Africa businesses
to Meda AB for $428 million. The business retrenchment, cost
realignment, and the right-sizing of its capital structure have
also strengthened the firm as it attempts to spur sales growth.
S&P sees these moves as largely positive for Valeant's future
growth plans and creditworthiness.
Faced with a declining top line and thin pipeline, Valeant has
made numerous acquisitions over the past year to shore up its
pipeline and product portfolio. The purchases of EMO-FARM Ltd,
Dow Pharmaceuticals, Coria, and Dermatech all help address these
shortfalls; still, the company will be challenged in its
integration efforts and ability to quickly bring new products to
market.
ALLIS-CHALMERS: Issues to Stockholders Rights to Buy 35.7MM Shares
------------------------------------------------------------------
Allis-Chalmers Energy Inc. disclosed in a filing with the
Securities and Exchange Commission that it issued to its
stockholders rights to purchase approximately 35.7 million shares
of its common stock at a subscription price of $2.50 per share.
Lime Rock Partners V, L.P. has agreed, subject to certain terms
and conditions, to backstop the offering by purchasing from
Allis-Chalmers, at the same price, any shares not purchased by
Allis-Chalmers' existing stockholders, up to the number of shares
of common stock that will constitute 34.055% of Allis-Chalmers'
common stock outstanding after the offering and the closing of the
backstop commitment. Allis-Chalmers intends to use the proceeds
of the offering to repay indebtedness outstanding under its bank
credit facility and senior notes. If the conditions to Lime
Rock's backstop commitment are met, Allis-Chalmers expects the
aggregate gross proceeds of the offering and the backstop
commitment to be between approximately $79.9 and $89.3 million.
Allis-Chalmers plans to distribute, at no charge, to the holders
of its common stock as of 5:00 p.m. Eastern time on June 1, 2009,
the record date for purposes of the offering, one non-transferable
warrant for each share of common stock owned on the record date.
Each warrant will represent the right to purchase one share of
Allis-Chalmers common stock at the subscription price.
The offering will include an oversubscription privilege that will
allow warrant holders who fully exercise their warrants to
subscribe for, at the subscription price, up to an additional 32%
of the number of shares they were entitled to purchase through
their basic subscription, but only to the extent that additional
shares are available because other warrant holders do not exercise
their warrants in full. Assuming three day settlement, the last
day on which to buy Allis-Chalmers common stock and receive
warrants with respect to the stock was May 27, 2009.
Allis-Chalmers expects to mail a prospectus supplement and a
warrant certificate to each record date stockholder on or about
June 3, 2009, and anticipates that the warrants will expire on or
about June 16, 2009. Each of these dates is subject to change,
and stockholders should review the prospectus supplement to
determine the final dates relating to the offering.
Allis-Chalmers may terminate the offering at any time in its sole
discretion.
RBC Capital Markets Corporation is serving as Allis-Chalmers'
financial advisor in connection with the rights offering, backstop
commitment and private placement of convertible preferred stock.
Notes Offering
Allis-Chalmers also is commencing cash tender offers to purchase
up to $100 million aggregate principal amount of its 9.0% Senior
Notes due 2014 (CUSIP Number 019645 AC 4) and up to $25 million
aggregate principal amount of its 8.5% Senior Notes due 2017
(CUSIP Number 019645 AE 0) at purchase prices per $1,000 principal
amount to be determined in accordance with a modified "Dutch
auction" procedure, as set forth in an Offer to Purchase dated
May 20, 2009.
The primary pricing terms for the Tender Offers are:
Security Description: 9% Senior Notes due 2014
CUSIP No.: 019645 AC 4
Maturity Date: January 15, 2014
Outstanding principal Amount: $255,000,000
Principal Amount Subject to the Tender Offer: $100,000,000
Early Participation Payment: $20
Total Consideration: $570 - $650
Security Description: 8% Senior Notes due 2017
CUSIP No.: 019645 AE 0
Maturity Date: March 1, 2017
Outstanding principal Amount: $50,000,000
Principal Amount Subject to the Tender Offer: $25,000,000
Early Participation Payment: $20
Total Consideration: $520 - $600
The total consideration payable pursuant to the Tender Offers per
$1,000 principal amount of Notes validly tendered and accepted for
purchase by Allis-Chalmers will be determined based on a formula
consisting of a base price per $1,000 principal amount of Notes
equal to $570, plus a clearing premium not to exceed $80, in the
case of the 9.0% Notes, and equal to $520, plus a clearing premium
not to exceed $80, in the case of the 8.5% Notes.
Holders of Notes who validly tender their Notes at or prior to
9:00 a.m., Eastern Time, on June 3, 2009, unless extended by
Allis-Chalmers, will receive an early participation payment of $20
per $1,000 principal amount of Notes tendered. Holders tendering
their Notes after the Early Participation Date will not be
eligible to receive the Early Participation Payment.
The Tender Offers are scheduled to expire at 5:00 p.m., Eastern
time, on June 18, 2009, unless extended or earlier terminated by
Allis-Chalmers. Tendered Notes may be withdrawn at any time at or
prior to 9:00 a.m., Eastern time, on June 3, 2009, unless extended
by Allis-Chalmers. Holders of Notes who tender their Notes after
the Withdrawal Date, but on or prior to the Expiration Date, may
not withdraw their tendered Notes.
Allis-Chalmers has retained RBC Capital Markets Corporation to act
as the dealer manager for the Tender Offers. Global Bondholder
Services Corporation is the information agent and depositary for
the Tender Offers. Questions regarding the Tender Offers may be
directed to Mario Lewis at RBC Capital Markets Corporation at
(212) 618-2204. Requests for documentation may be directed to
Global Bondholder Services Corporation by calling toll-free (866)
470-3600 or (212) 430-3774 (for banks and brokers).
About Allis-Chalmers
Headquartered in Houston, Texas, Allis-Chalmers Energy Inc. --
http://www.alchenergy.com/-- provides services and equipment to
oil and natural gas exploration and production companies, in
Texas, Louisiana, New Mexico, Colorado, Oklahoma, Mississippi,
Wyoming, Arkansas, West Virginia, offshore in the Gulf of Mexico,
Argentina and Mexico. Allis-Chalmers provides rental services,
international drilling, directional drilling, tubular services,
underbalanced drilling, and productions services.
* * *
As reported in the Troubled Company Reporter on May 26, 2009,
Standard & Poor's Ratings Services said that it lowered its long-
term corporate credit rating on Houston, Texas-based, Allis-
Chalmers Energy Inc. to 'CC' from 'B'. At the same time, S&P
lowered the ratings on Allis' senior notes to 'CC' from 'B'. S&P
also placed the ratings on CreditWatch with negative implications.
AMC ENTERTAINMENT: Fitch Assigns 'B/RR4' Rating on Senior Notes
---------------------------------------------------------------
Fitch Ratings has assigned a 'B/RR4' rating to AMC Entertainment,
Inc.'s senior unsecured note offering due 2019. The proceeds are
expected to be used to fund the company's tender offer of its
$250 million 8.625% senior unsecured notes due 2012 and for
general corporate purposes, which may include retirement of other
indebtedness at AMC (including any amounts of the $250 million
8.625% senior notes not purchased through the tender offer),
Marquee Holdings or AMC Entertainment Holdings Inc. (parent of
Marquee).
The announced tender offer provides for $1,030 per $1,000 in
principal amount if tendered on or before June 8, 2009 (the
consent date). AMC is seeking consent to amend the 2012 senior
notes and eliminate substantially all of the restrictive
covenants. The tender offer is scheduled to expire on June 22,
2009. AMC intends to redeem any remaining notes after Aug. 15,
2009 at the redemption price of $1,021.56 per $1,000, as provided
in the terms of the indenture.
In addition, AMC announced that it is seeking to amend its secured
bank credit facility to extend maturities, amend certain terms and
provide the consenting banks with increased pricing.
As of fiscal year end (April 2, 2009), revenues were down 3% for
the year and EBITDA declined 20%. Revenue declines were
attributable to declines in attendance and an extra week in the
2008 fiscal year. The decline in EBITDA was driven by the decline
in revenues and increase in operating expenses. Fitch is
concerned by AMC's box office revenues underperforming the
industry, as declines in revenues coupled with the company's high
operating leverage and vulnerability of its high margin
concessions (represent 28% of AMC's total revenues and carry 89%
gross margins) to reduced per-guest concession spending due to
cyclical factors or a re-acceleration of commodity prices, could
continue to materially weaken EBITDA.
As of April 2009, unadjusted leverage through AMC's secured debt
($814 million) was 3.0 times (x), total debt through Marquee
($2 billion) was 7.3x and through AMC Holdco ($2.2 billion) was
8.2x. When factoring in the $536.6 million in cash, net leverage
through AMC Holdco is 6.2x. Given high leverage and pressured
operating performance over the last few quarters, AMC's Issuer
default Rating (IDR) of 'B' and Stable Outlook are weakly
positioned in the category. Additionally, should the company use
material portions of this offering to retire structurally
subordinate debt, the 'B/RR4' rating for this issuance and other
of AMC's senior unsecured notes could be affected as it could
result in weaker recovery ratings per Fitch's methodology.
AMC has adequate liquidity which is supported by cash of
$534 million. AMC has no remaining availability on its
$200 million committed revolving credit facility ($185 million
outstanding and $14.2 million in letters of credit). The
company's maturity schedule is manageable. AMC's first material
maturity is its revolving credit facility, which comes due in
2012. AMC's term loan amortizes annually at $6.5 million and has
a final maturity in January 2013. Free cash flow for April 2009
latest 12 months (LTM) was a positive $41.9 million. Fitch
expects that AMC can address its near-term maturities with cash on
hand and free cash flow and recognizes that there is refinancing
risk in 2013 and beyond.
The ratings reflect AMC's significant debt load and significant
operating lease commitments related to its theatre circuit,
resulting in $450 million in annual rent expense. The ratings
also reflect the current and prospective challenges facing the
movie exhibitor industry, including increasing indirect
competition from other distribution channels, such as DVD, video
on demand or the Internet, as well as the shrinking release window
and the concentrated base of film distributors. Most importantly,
AMC and its peers rely on the quality, quantity and timing of
movie product, all factors out of management's control.
Ratings are supported by AMC's competitive positioning as the
second largest domestic movie exhibitor with a major presence in
urban markets and a leading market share in many of the largest
designated market areas. AMC has the highest average screen count
per theatre of 15 compared to the industry average of seven and is
expected to continue to modernize its theatre portfolio in a
disciplined manner. The ratings also reflect AMC's involvement in
cinema advertising through its ownership stake in National
CineMedia LLC, its initiatives in adding/upgrading screens to 3D
and IMAX screens and its digital cinema initiative through Digital
Cinema Implementation Partners, LLC.
AMC and its related holding companies' are rated:
AMC
-- IDR 'B';
-- Senior secured credit facilities 'BB/RR1';
-- Senior unsecured notes 'B/RR4';
-- Senior subordinated notes 'CCC+/RR6'.
Marquee
-- IDR 'B';
-- Senior discount notes 'CCC/RR6'.
AMC Holdco
-- IDR 'B';
-- Senior unsecured term loan 'CCC/RR6'.
The Rating Outlook is Stable.
AMC ENTERTAINMENT: S&P Affirms 'B-' Rating on $600 Mil. Notes
-------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on AMC
Entertainment Inc.'s proposed senior unsecured notes due 2019,
following the company's announcement that it now intends to issue
$600 million of notes (upsized from $300 million). The issue-
level rating remains at 'B-' (one notch lower than the 'B'
corporate credit rating on AMC) and the recovery rating remains at
'5', indicating S&P's expectation of modest (10% to 30%) recovery
for noteholders in the event of a payment default.
The corporate credit rating on Kansas City, Missouri-based movie
exhibitor AMC is 'B' and the rating outlook is stable. The 'B'
rating reflects the company's high financial risk tolerance, high
leverage, and lower EBITDA margins relative to peers. The rating
also considers the company's participation in the mature and
highly competitive U.S. movie exhibition industry, exposure to the
fluctuating popularity of Hollywood films, risk of increased
competition from the proliferation of entertainment alternatives,
and pressure from shortening movie release windows. The company's
size, its modern theater circuit relative to other major theater
chains, and its large and geographically diverse U.S. operations
partially offset company risks. AMC is rated on a consolidated
basis with super-holding company AMC Entertainment Holdings Inc.
and holding company Marquee Holdings Inc.
Ratings List
AMC Entertainment Inc.
Corporate Credit Rating B/Stable/--
Affirmed
$600M sr unsecd nts due 2019 B-
Recovery Rating 5
AMC ENTERTAINMENT: Notes Offering Increased to $600 Million
-----------------------------------------------------------
AMC Entertainment Inc. said it increased its offering of notes to
$600 million and expects that the aggregate net proceeds from the
offering will be approximately $568.1 million.
The Troubled Company Reporter previously reported that the company
originally proposed to issue $300 million in aggregate principal
amount of senior notes due 2019 in a private offering that is
exempt from the registration requirements of the Securities Act of
1933, as amended.
The Company said a portion of the net proceeds from the private
offering will be used to:
-- purchase its outstanding $250 million aggregate principal
amount of 85/8% Senior Notes due 2012 pursuant to a cash
tender offer announced Tuesday; and
-- retire any 2012 Notes not purchased in the cash tender offer
or some of other its existing indebtedness and indebtedness
of its parent companies through open market purchases.
Any retirement of parent indebtedness may involve the dividend of
proceeds to the parent companies, the company added.
The tender offer will expire at midnight on June 22, 2009, New
York time. Under the terms of the tender offer, holders of the
2012 Notes who validly tender and do not validly withdraw their
2012 Notes and consents prior to 5:00 p.m., New York City time on
June 8, 2009, such time and date which may be extended, will
receive the total consideration, which is equal to:
(i) $1,000 per $1,000 in principal amount of 2012 Notes validly
tendered, plus
(ii) $30 per $1,000 in principal amount of the 2012 Notes validly
tendered.
According to the Company, holders of the 2012 Notes who validly
tender their 2012 Notes after the consent date but on or before
the expiration date will receive only the tender consideration.
In both cases, holders whose 2012 Notes are purchased in the
tender offer will also be paid accrued and unpaid interest from
the most recent interest payment date on the 2012 Notes to, but
not including, the applicable settlement date.
In connection with the tender offer, the Company is soliciting the
consent of holders of the 2012 Notes to certain proposed
amendments to the indenture governing the 2012 Notes.
The Company said the primary purpose of the consent solicitation
and proposed amendments is to eliminate substantially all of the
restrictive covenants and certain events of default and reduce the
required notice period contained in the optional redemption
provisions of the indenture. The Company further says that it
intends to redeem any 2012 Notes that remain outstanding after the
consummation of the tender offer at a price of $1,021 per $1,000
principal amount of Notes as promptly as practicable after
August 15, 2009, in accordance with the terms of the indenture.
About AMC Entertainment
Headquartered in Kansas City, Missouri, AMC Entertainment Inc.
-- http://www.amctheatres.com/-- is a theatrical exhibition
company. As of July 3, 2008, the Company owned, operated or had
interests in 353 theatres and 5,117 screens, with 89% or 4,569 of
its screens in the U.S. and Canada and 11%, or 548 of its screens
in Mexico, China (Hong Kong), France, and the United Kingdom.
The Company's principal direct and indirect owned subsidiaries are
American Multi-Cinema Inc., Grupo Cinemex, S.A. de C.V., and AMC
Entertainment International Inc.
* * *
According to the Troubled Company Reporter on May 29, 2009,
Moody's Investors Service rated AMC Entertainment, Inc.'s new
$600 million senior unsecured notes B1. Proceeds will be used to
retire AMC's $250 million 8.625% notes due August 2012 and to
bolster liquidity by reducing outstanding amounts under its
$200 million senior secured revolving term loan due January, 2012
and adding to the company's cash balance.
On May 28, 2009, Standard & Poor's Ratings Services said it
assigned an issue-level rating of 'B-' (one notch lower than the
'B' corporate credit rating on the company) to AMC Entertainment
Inc.'s new $300 million senior unsecured notes due 2019, along
with a recovery rating of '5', indicating S&P's expectation of
modest (10%-30%) recovery for noteholders in the event of payment
default.
AMERICAN NATURAL: Mulls Offering of 30MM Shares of Common Stock
---------------------------------------------------------------
American Natural Energy Corporation intends to seek to raise
additional capital, subject to TSX Venture Exchange approval,
proposed to be used to fund the transaction with Dune Energy,
Inc., and for working capital purposes.
The terms of the transaction will involve the sale of up to
30 million shares of ANEC's Common Stock at a price of $0.05 per
share or total proceeds of up to $1.5 million. If completed, the
transaction will result in dilution to the present holders of
ANEC's Common Stock. The offer and sale of the securities by ANEC
to the subscribers has not been and will not be registered under
the U.S. Securities Act of 1933, as amended, and the securities
may not be offered or sold in the United States absent
registration under the Act or an available exemption from the
registration requirements.
The offer and sale of its securities is intended to be made
pursuant to the exemption from the registration requirements of
the U.S. Securities Act afforded by Regulation D and in reliance
upon Regulation S under that Act and will result in the issuance
of "restricted securities" as defined in Rule 144 under the Act.
There can be no assurance that ANEC will be successful in raising
the additional capital through the sale of its Common Stock.
About American Natural Energy
Based in Tulsa, Oklahoma, American Natural Energy Corporation is
engaged in the acquisition, development, exploitation and
production of oil and natural gas. The Company acquired the
assets and outstanding stock of Couba Operating Company in
December 2001, after Couba was forced into chapter 7 bankruptcy in
March 2000. The case was later converted to Chapter 11 and in May
2001, the Company joined with Couba in submitting to the
Bankruptcy Court a plan of reorganization whereby the Company
would acquire substantially all the assets -- consisting of
physical oil and gas facilities -- and capital stock of Couba.
The plan was finally confirmed November 16, 2001.
Going Concern Doubt
As reported in the Troubled Company Reporter on April 30, 2009,
Malone & Bailey, PC, in Houston, Texas, the independent registered
public accounting firm of American Natural Energy Corporation
raised substantial doubt about the Company's ability to continue
as a going concern.
American Natural Energy has sustained substantial losses in 2008
and 2007, totaling approximately $61,000 and $3.2 million, and had
a working capital deficiency at Dec. 31, 2008, of approximately
$20.3 million. Production from the Company's drilling program
increased during 2008 compared to 2007; however, its revenue has
not been sufficient to fund operations.
As of December 31, 2008, American Natural Energy does not have any
available borrowing capacity under existing credit facilities, and
its current assets are $154,000 compared with current liabilities
of $20.4 million. American Natural Energy's current liabilities
include approximately $10.8 million of secured indebtedness, which
was due September 2006 and is currently in default and accounts
payable, revenues payable, notes payable, and other current
obligations aggregating to approximately $9.6 million.
ANCHOR BLUE: Selling 73 Outlet Stores to Levi Strauss
-----------------------------------------------------
Levi Strauss & Co. said it agreed to acquire the operating rights
to 73 MOST stores, Anchor Blue Retail Group Inc.'s denim outlet
subsidiary, which carry Levi's(R) and Dockers(R) inventory.
"This proposed acquisition is a natural next step in our long-term
growth strategy," said Robert Hanson, president of Levi Strauss
Americas. "The outlet channel is poised for continued growth over
the near- and long-term. We believe that this transaction will
strengthen our ability to manage our brands' positioning
effectively in the outlet channel, will provide a profitable
growth opportunity for LS&CO., and will ensure that we can
continue to provide outlet shoppers with the great value and
world-class quality they expect from Levi's(R) and Dockers(R)
products," Mr. Hanson related.
Levi Strauss noted that Anchor Blue and its subsidiaries have
filed a voluntary petition under Chapter 11 of the U.S. Bankruptcy
Code in the Bankruptcy Court for the District of Delaware to enter
a 363 sale process to facilitate a restructuring and to seek Court
approval for the sale of the Levi's(R) and Dockers(R) stores to
it.
Completion of the transaction is subject to a number of closing
conditions, including the approval of the Bankruptcy Court, Levi
Strauss noted. Subject to conditions, the transaction is expected
to close in July. Anchor Blue has indicated its outlet stores
will remain open for business without interruption during the
period prior to closing the proposed acquisition, Levi Strauss
said.
About Levi Strauss & Co.
Headquartered in San Francisco, California, Levi Strauss & Co. --
http://www.levistrauss.com/-- is one of the world's leading
branded apparel companies. The company designs and markets jeans,
casual and dress pants, tops, jackets and related accessories, for
men, women and children under the Levi's(R), Dockers(R) and
Signature by Levi Strauss & Co.(TM). The company markets its
products in three geographic regions: Americas, Europe and Asia
Pacific.
According to the Troubled Company Reporter on May 29, 2009,
Moody's Investors Service said Levi Strauss & Co. Inc.'s entry
into an Asset Purchase Agreement with Anchor Blue Retail Group has
no immediate impact on LS&Co's B1 Corporate Family Rating or the
positive rating outlook.
About Anchor Blue
Headquartered in Ontario, Canada, Anchor Blue Retail Group Inc.
operates retail stories. The Company and four of its affiliates
filed for Chapter 11 protection on May 27, 2009 (Bankr. D. Del.
Lead Case No. 09-11770). Chun I. Jang, Esq., and Jason M. Madron,
Esq., at Richards Layton & Finger P.A., represent the Debtors' in
their restructuring efforts. The Debtors listed assets less than
$50,000, and debts between $100 million to $500 million.
ANEKONA W: Files for Chapter 11 Bankruptcy Protection
-----------------------------------------------------
Pacific Business News reports that Anekona W has filed for Chapter
11 bankruptcy protection.
Pacific Business News relates that Anekona was in foreclosure and
scheduled to be sold at public auction on June 12, but the
bankruptcy filing effectively has canceled that auction.
Pacific Business News states that First Hawaiian Bank filed a
foreclosure lawsuit on October 27, 2008, against Anekona, claiming
that the Company owed more than $4.9 million in principal,
interest, and fees on a $5 million loan.
William H. Gilardy, Jr., assists Anekona in its restructuring
efforts, Pacific Business News says.
Anekona W, fka W Honolulu Hotel, is controlled by developer Brian
Anderson that owns The Lotus at Diamond Head hotel.
ARCLIN CANADA: Moody's Downgrades Corp. Family Rating to 'Caa3'
---------------------------------------------------------------
Moody's Investors Service lowered Arclin Canada Ltd's Corporate
Family Rating to Caa3 from Caa1 due to the lack of progress in
negotiating an amendment to the financial covenants in its
revolver and term loans and the failure of the sponsor to commit
additional capital. The outlook is negative.
Moody's also lowered the ratings on the first lien facilities ($20
million revolver and $183 million term loan) to Caa3 from B3 and
the second lien notes were downgraded to C from Caa3.
The downgrade reflects the fact that financial results are
expected to be extremely weak in 2009 and that the company may
need to execute some form of a distressed exchange with existing
term loan holders or file for bankruptcy if an agreement can not
be reached. Arclin has been negotiating with its lenders since
February on the terms of an amendment to its credit facilities.
"While the sponsor may eventually commit additional capital,
lenders will likely incur a significant haircut to their loan
value in order to reach an agreement," stated John Rogers, Senior
Vice President at Moody's.
Arclin is negotiating with its lenders to amend the financial
covenants in its credit facilities. In Moody's opinion, the
sponsor (Ontario Teachers Private Capital -- OTPC) would need to
put in additional capital as part of the amendment process to
ensure that the company is able to survive the current downturn.
The company continues to operate with less than $10 million of
cash and no access to its revolver. In Moody's opinion, this will
not allow the company to continue operating for the remainder of
2009 or fund normal working capital or capital expenditures.
Moreover, Moody's current expectations are for a very slow
recovery in wood products output (i.e., year-on-year volume
comparisons will likely remain negative until the first or second
quarter of 2010). Hence, Arclin will certainly need more capital
or access to additional revolving credit to remain viable.
The Ca PDR reflects Moody's belief that there is a very high
likelihood of a distressed exchange or bankruptcy due to OTPC's
reluctance to contribute additional capital to the company.
Moody's believes that a financial restructuring (either negotiated
or through a formal bankruptcy process) will be necessary to
provide sufficient liquidity. The negative outlook reflects the
potential for a further reduction in creditor recoveries as
negotiations continue between the company and its lenders.
Ratings downgraded:
Arclin Canada Ltd.
-- Corporate family rating to Caa3 from Caa1
-- Probability of Default rating to Ca from Caa1
-- Senior Secured Revolving credit facility to Caa3, LGD2/29%
from B3, LGD3/41%
-- Senior Secured Term Loan to Caa3, LGD2/29% from B3, LGD3/41%
-- Senior Secured Second Lien Term Loan to C, LGD5/76% from
Caa3, LGD5/83%
The last rating action on Arclin was on February 10, 2009, when
Moody's lowered the CFR to Caa1 and placed the company on review
for further downgrade.
Arclin Canada Ltd., headquartered in Mississauga, Ontario, is a
vertically integrated manufacturer of adhesive resins and overlay
products for use in adhesion and surfacing applications in the
construction, furniture, and general industrial businesses.
ATLANTIC BROADBAND: S&P Affirms Corporate Credit Rating at 'B+'
---------------------------------------------------------------
Standard & Poor's Ratings Services said it affirmed the 'B+'
corporate credit rating on Quincy, Massachusetts-based regional
cable TV provider Atlantic Broadband Finance LLC. S&P also
assigned 'BB-' issue-level and '2' recovery ratings to Atlantic's
proposed amended and extended senior secured credit facility,
specifically the new $325 million term loan B due June 2013 and
the new $40 million revolving credit facility due March 2012.
In addition, S&P raised the issue-level ratings on Atlantic's
existing term loan B due September 2011 and existing revolving
credit facility due March 2010 to 'BB-' from 'B+' and revising the
recovery rating on the debt to '2' from '3'. The '2' recovery
rating indicates expectations for substantial (70%-90%) recovery
of principal in the event of payment default. The outlook is
stable.
Under the proposed amendment to the existing senior secured credit
facility, Atlantic will be issuing a new $325 million term loan B
which will mature in June 2013. The proceeds from this new term
loan will be used to pay down part of the existing term loan B
which matures in September 2011. Pro forma, about $119 million of
the existing term loan B will be outstanding. Also, the company
will take on a new $40 million revolving credit facility that
matures in March 2012. The existing $67.5 million revolving
credit facility will be reduced to $27.5 million and still matures
in March 2010.
"We are affirming the corporate credit rating because the
transaction is a refinancing and does not immediately affect the
company's leverage," said Standard & Poor's credit analyst Naveen
Sarma. Pro forma for the transaction, adjusted debt to last-12-
month EBITDA remains about 5.8x, which is appropriate for the 'B+'
rating category. This ratio is somewhat increased by S&P's 100%
treatment of the preferred units, currently totaling about
$60 million, which resides at the parent, Atlantic Broadband Group
LLC. S&P is raising the issue-level rating on the existing credit
facility primarily because S&P is revising the assumptions in
S&P's default scenario. Previously S&P had assumed that the
existing revolver would be extended beyond the March 2010 maturity
date. Now S&P is assuming that that revolver is allowed to expire
at maturity. Hence, at default, the revolver size is smaller and
thus recovery on the two term loans is improved.
AVENTINE RENEWABLE: Abandons Recapitalization Efforts, Seeks Sale
-----------------------------------------------------------------
Kirsten Korosec posted on the BNET Energy Blog that Aventine
Renewable Energy has stopped tying up its effort and hopes into
recapitalization, and has put its business up on the public
selling block.
As reported by the Troubled Company Reporter on May 28, 2009,
Aventine Renewable Energy said that in addition to the parties
that showed an expression of interest, it was publicly soliciting
other potential investor interest in support of a recapitalization
or sale of its business. The Company had set a deadline of
June 17 for submissions of interest.
Ms. Korosec states that a reorganization could happen for Aventine
Renewable and the Company is likely to be sold, probably in pieces
by the June 17 deadline.
Pekin, Illinois-based Aventine Renewable Energy Holdings, Inc.
(Pink Sheets:AVRN) -- http://www.aventinerei.com/-- is a producer
and marketer of ethanol to many leading energy companies in the
United States. In addition to ethanol, Aventine also produces
distillers grains, corn gluten meal, corn gluten feed, corn germ
and brewers' yeast.
Morgan Stanley Capital Partners IV bought Aventine in May 2003
from Williams Cos. Aventine had a public offering in May 2006.
The Morgan Stanley group retained 28% of the stock at year's end.
The Company and its affiliates filed for Chapter 11 on April 7,
2009 (Bankr. D. Del., Lead Case No. 09-11214). The Debtors have
tapped Joel A. Waite, Esq., at Young, Conaway, Stargatt & Taylor,
as counsel. Davis Polk & Wardwell is special tax counsel and
Houlihan, Lokey, Howard & Zukin, Inc., is the financial advisor.
Garden City Group, Inc., has been engaged as claims agent. In its
bankruptcy petition, Aventine disclosed $799,459,000 in assets and
$490,663,000 in debts as of December 31, 2008.
AVENTINE RENEWABLE: Panel Wants to Tap Greenberg & Jefferies Firms
------------------------------------------------------------------
The Official Committee of Unsecured Creditors in Aventine
Renewable Energy Holdings, Inc., and its debtor-affiliates'
Chapter 11 cases filed motions seeking approval from the U.S.
Bankruptcy Court for the District of Delaware to retain Greenberg
Traurig as counsel and Jefferies & Company as investment banker.
BankruptcyData.com reports that Greenberg Traurig's hourly rates
are: shareholder at $335 to $1,050, of counsel at $325 to $900,
associate at $200 to $575, paralegal at $65 to $310. Jefferies &
Company will charge a monthly fee of $125,000 and a transaction
fee of $1,500,000, the report adds.
Separately, the Court approved the Debtors' motions to retain
Young Conaway Stargatt & Taylor as attorney and Jenner & Block as
special counsel.
Pekin, Illinois-based Aventine Renewable Energy Holdings, Inc.
(Pink Sheets:AVRN) -- http://www.aventinerei.com/-- is a producer
and marketer of ethanol to many leading energy companies in the
United States. In addition to ethanol, Aventine also produces
distillers grains, corn gluten meal, corn gluten feed, corn germ
and brewers' yeast.
Morgan Stanley Capital Partners IV bought Aventine in May 2003
from Williams Cos. Aventine had a public offering in May 2006.
The Morgan Stanley group retained 28% of the stock at year's end.
The Company and its affiliates filed for Chapter 11 on April 7,
2009 (Bankr. D. Del., Lead Case No. 09-11214). The Debtors have
tapped Joel A. Waite, Esq., at Young, Conaway, Stargatt & Taylor,
as counsel. Davis Polk & Wardwell is special tax counsel and
Houlihan, Lokey, Howard & Zukin, Inc., is the financial advisor.
Garden City Group, Inc., has been engaged as claims agent. In its
bankruptcy petition, Aventine disclosed $799,459,000 in assets and
$490,663,000 in debts as of December 31, 2008.
AVIS BUDGET: Obtains $325 Million Operating Lease Financing
-----------------------------------------------------------
Avis Budget Group, Inc., obtained commitments for approximately
$325 million of operating lease financing for vehicles it plans to
add to its U.S. car rental fleet over the next four months. The
Company did not disclose where the commitment came from.
"This transaction represents another important step in the
evolution and expansion of our fleet financing to reflect the
changes that have occurred in the credit markets," said David B.
Wyshner, Avis Budget Group executive vice president and chief
financial officer. "With this financing, we are not only
obtaining additional liquidity at competitive rates; we are also
executing against a funding strategy that anticipates a rebound in
car rental demand in 2010."
Avis Budget Group (NYSE: CAR) -- http://www.avisbudgetgroup.com/
-- is a leading provider of vehicle rental services, with
operations in more than 70 countries. Through its Avis and Budget
brands, the company is the largest general-use vehicle rental
company in each of North America, Australia, New Zealand and
certain other regions based on published airport statistics. Avis
Budget Group is headquartered in Parsippany, N.J. and has more
than 28,000 employees.
* * *
As reported in the Troubled Company Reporter on April 22, 2009,
Standard & Poor's Ratings Services affirmed its ratings on car and
consumer truck renter Avis Budget Group Inc., including affirming
the 'CCC+' long-term corporate credit rating. At the same time,
S&P lowered its ratings on the company's credit facility to 'CCC+'
from 'B', the same as the corporate credit rating on the company.
S&P revised the recovery rating on this debt to a '4' from a '1',
indicating average (30%-50%) recovery of principal in the event of
a payment default, based upon S&P's expectation that the credit
markets will continue to require higher collateralization for
secured vehicle facilities, leaving less available for the
corporate secured lenders.
BANK OF AMERICA: Temple Sloan Leaves Board of Directors
-------------------------------------------------------
Bank of America Corp. said that O. Temple Sloan, Jr., has resigned
from the Board of Directors, effective May 26, 2009.
Mr. Sloan had served BofA for 13 years as a director and most
recently was the Lead Director. He submitted his resignation to
Walter E. Massey, chairperson of the BofA Board of Directors. Mr.
Sloan most recently served as the chairperson of the Executive
Committee and Compensation and Benefits Committee. He was also a
member of the Corporate Governance Committee.
"Temple has been a trusted adviser who has made an invaluable
contribution to the success of our company," said Kenneth D.
Lewis, BofA chief executive officer and president. "We will miss
his counsel and his leadership."
Mr. Sloan's "decision to resign was not as a result of any
disagreement with the Corporation or its management," BofA said in
a statement. Dan Fitzpatrick and Joann S. Lublin at The Wall
Street Journal quoted a BofA spokesperson as saying, "It was a
personal choice on his part."
WSJ relates that Mr. Sloan received the fewest re-election votes
of any director at April's shareholder meeting, and had been the
target of labor unions and other activist investors angry with the
Company's recent performance and decision to purchase Merrill
Lynch & Co. WSJ notes that Mr. Sloan's resignation is expected to
be followed by more departures from the BofA board, as Mr. Massey
works to reconstitute his board with experts in banking and
finance. WSJ relates that U.S. regulators have pressured new Mr.
Massey to recruit new board members. WSJ, citing a person
familiar with the matter, says that regulators haven't supplied
the bank with names of directors who should leave BofA, and other
bank directors have volunteered to resign.
Based in Charlotte, North Carolina, Bank of America --
http://www.bankofamerica.com/-- is one of the world's largest
financial institutions, serving individual consumers, small and
middle market businesses and large corporations with a full range
of banking, investing, asset management and other financial and
risk-management products and services. The Company serves more
than 59 million consumer and small business relationships with
more than 6,100 retail banking offices, nearly 18,700 ATMs and
online banking with nearly 29 million active users. Following the
acquisition of Merrill Lynch on January 1, 2009, Bank of America
is among the world's leading wealth management companies and is a
global leader in corporate and investment banking and trading
across a broad range of asset classes serving corporations,
governments, institutions and individuals around the world. Bank
of America offers support to more than 4 million small business
owners. The company serves clients in more than 150 countries.
Bank of America Corporation stock is a component of the Dow Jones
Industrial Average and is listed on the New York Stock Exchange.
The bank needed the government's financial help in completing its
acquisition of Merrill Lynch.
Merrill Lynch & Co. Inc. -- http://www.ml.com/-- is a wealth
management, capital markets and advisory companies with offices in
40 countries and territories. As an investment bank, it is a
leading global trader and underwriter of securities and
derivatives across a broad range of asset classes and serves as a
strategic advisor to corporations, governments, institutions and
individuals worldwide. Merrill Lynch owns approximately half of
BlackRock, one of the world's largest publicly traded investment
management companies with more than $1 trillion in assets under
management. Merrill Lynch's operations are organized into two
business segments: Global Markets and Investment Banking (GMI) and
Global Wealth Management (GWM).
As reported by the Troubled Company Reporter on March 27, 2009,
Moody's Investors Service lowered the senior debt rating of Bank
of America Corporation to A2 from A1, the senior subordinated debt
rating to A3 from A2, and the junior subordinated debt rating to
Baa3 from A2. The preferred stock rating was downgraded to B3
from Baa1. The holding company's short-term rating was affirmed
at Prime-1.
BANKUNITED FINANCIAL: Receives Notice of Delisting from NASDAQ
--------------------------------------------------------------
BankUnited Financial Corporation received a Nasdaq Staff
Determination letter notifying the Company that, in accordance
with Marketplace Listing Rules 5100, 5110(b) and IM-5100-1, the
staff of The NASDAQ Stock Market LLC has determined that the
Company's securities will be delisted from the Nasdaq Stock
Market.
Trading of the Company's securities was halted on May 22, 2009.
Pursuant to the Nasdaq Determination Letter, the Company may
request an appeal to the Nasdaq Staff Determination; however, the
Company does not intend to do so. Therefore, the Company's stock
will be suspended at the opening of business on June 2, 2009 and a
Form 25-NSE will be filed with the Securities and Exchange
Commission, which will remove the Company's securities from
listing and registration with the Nasdaq.
According to the Nasdaq Determination Letter, the determination to
delist the Company's securities was based on the Company's Chapter
11 bankruptcy filing, its delinquencies in filing its public
reports with the SEC and the Company's non-compliance with
Marketplace Rule 5620(b), which requires the solicitation of proxy
materials in connection with an annual meeting of stockholders
About BankUnited
BankUnited Financial Corp. -- http://www.bankunited.com/-- is the
holding company for BankUnited FSB, the largest banking
institution headquartered in Coral Gables, Florida. Serving
customers through 85 branches in 13 coastal counties, BankUnited
offers a full spectrum of consumer and commercial banking products
and services, including online products.
BEARINGPOINT INC: Acquisition by PricewaterhouseCoopers Okayed
--------------------------------------------------------------
Reuters reports that PricewaterhouseCoopers said that the U.S.
Bankruptcy Court for the Southern District of New York has
approved its acquisition of significant portions of BearingPoint
Inc.'s North American and Shanghai, China assets.
As reported by the Troubled Company Reporter on May 21, 2009,
BearingPoint International Bermuda Holdings Limited,
BearingPoint's indirect subsidiary, entered on April 2, 2009, into
a Share Sale Agreement with PwC Advisory Co., Ltd., the Japanese
member firm of the PricewaterhouseCoopers global network of firms,
for the sale of BearingPoint's consulting business in Japan to PwC
Japan for roughly $45 million. On April 17, 2009, BearingPoint
and certain of its subsidiaries entered into a definitive
agreement with PricewaterhouseCoopers LLP pursuant to which
BearingPoint agreed to sell a substantial portion of its assets
related to its Commercial Services business unit, including
Financial Services, to PwC. In addition, an affiliate of PwC also
entered into a definitive agreement to purchase the equity
interests of BearingPoint Information Technologies (Shanghai)
Limited, a subsidiary of BearingPoint that operates a global
development center in China, and certain assets of a separate
global development center in India. The aggregate purchase price
for the three transactions is roughly $25 million.
Reuters relates that PwC agreed to purchase BearingPoint's unit in
Bangalore, India, in a separate transaction that didn't require
court approval, and that all the transactions were agreed for a
total of $44 million.
According to Reuters, PwC said that the transaction for the North
American unit would close in June, while closing dates for the two
global delivery centers would be in the coming months. PwC,
Reuters relates, said that upon closing of the deal, its advisory
practice will assume selected contracts and assets of
BearingPoint.
About BearingPoint Inc.
BearingPoint, Inc. -- http://www.BearingPoint.com/-- is currently
one of the world's largest providers of management and technology
consulting services to Global 2000 companies and government
organizations in more than 60 countries worldwide. Based in
McLean, Va., BearingPoint -- a former consulting arm of KPMG LLP
-- has approximately 15,000 employees focusing on the Public
Services, Commercial Services and Financial Services industries.
BearingPoint professionals have built a reputation for knowing
what it takes to help clients achieve their goals, and working
closely with them to get the job done. The Company's service
offerings are designed to help clients generate revenue, increase
cost-effectiveness, manage regulatory compliance, integrate
information and transition to "next-generation" technology.
BearingPoint, Inc., fka KPMG Consulting, Inc., together with its
units, filed for Chapter 11 protection on February 18, 2009
(Bankr. S.D. N.Y., Case No. 09-10691). Alfredo R. Perez, Esq., at
Weil Gotshal & Manges LLP, has been tapped as counsel. Greenhill
& Co., LLC, and AP Services LLC, have also been tapped as
advisors. Davis Polk & Wardell is special corporate counsel.
BearingPoint disclosed total assets of $1,762,689,000, and debts
of $2,231,839,000 as of September 30, 2008.
Contemporaneous with their bankruptcy petitions, the Debtors filed
a pre-packaged Joint Plan of Reorganization under Chapter 11 to
implement the terms of their agreement with the secured lenders.
BearingPoint intended a traditional reorganization by proposing to
issue new stock to unsecured creditors and holders of $690 million
in subordinated notes, pursuant to a Chapter 11 plan. The
Debtors, however, changed their course and sold off certain units.
The Debtors sold their public services group to Deloitte LLP for
$350 million.
BIOFUEL ENERGY: Receives Notice of Default From Lenders
-------------------------------------------------------
Biofuel Energy Corp. has received a Notice of Default from its
syndicate of lenders, led by BNP Paribas, as Administrative Agent,
under its senior bank facility. The Company reported that the
banks have asserted that a "Material Adverse Effect" had occurred
with respect to the Company, even though it has not missed any
payments owed under the facility, or to any other creditors or
vendors, and expects to meet the interest payment due at the end
of May. The Company has entered into a Limited Consent and Waiver
and Amendment with its lenders, which will allow the Company to
have immediate access to its bank accounts to pay vendors for
corn, natural gas and other materials, while they continue to
pursue a longer-term solution to its liquidity issues. The
Company also announced it has retained a financial advisor to
support its ongoing discussions with its lenders.
Scott H. Pearce, President and CEO, said, "While we understand the
banks' concerns regarding the state of the ethanol industry and
the Company's financial condition, we are disappointed that BNP
Paribas and the other banks felt it necessary to take this action.
However, despite this action, we expect to have access to our bank
accounts in order to continue funding our day-to-day operations as
we work with the lenders and our advisors to reach a longer-term
arrangement."
Based on recent spot margins, the Company expects to operate at or
around cash breakeven in the second quarter prior to debt service
payments. As previously disclosed, the Company's ability to pay
debt service or to achieve profitability will depend on improved
industry margins. In the meantime, should the lenders delay or
prevent the Company from gaining access to funds necessary to
continue operations or accelerate the loans as a result of the
events of default asserted in the Notice of Default, the Company
may have to curtail or cease its operations, which would likely
result in its inability to continue as a going concern and could
force it to seek relief from creditors through a filing under the
U.S. Bankruptcy Code.
BioFuel Energy Corp. owns and operates two 115 million gallons per
year ethanol plants in the Midwestern corn belt.
BRIGHAM EXPLORATION: S&P Affirms 'CCC+' Corporate Credit Rating
---------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'CCC+' corporate
credit rating on oil and gas exploration and production company,
Brigham Exploration Co. The outlook is developing.
The affirmation follows the company's announcement that it has
received net proceeds of roughly $94 million from an equity
issuance. As of May 8, 2009, the company had approximately
$20 million of cash. Therefore, pro forma for the equity
offering, S&P expects liquidity to be more than $70 million in
cash, after giving effect for a $35 million repayment required
because of an overadvance on its borrowing base revolving credit
facility. Although the pro forma liquidity profile is much
improved, S&P is concerned that liquidity could become tight in
the fourth quarter of 2009 or first half of 2010 due to low
natural gas prices and an increased capital budget.
In conjunction with the equity issuance, the company announced an
increased capital budget. At S&P's 2009 price assumptions of $40
per barrel of West Texas Intermediate crude oil and $4.50 per mcf
of Henry Hub natural gas, S&P expects the company will outspend
cash flow and use a portion of the proceeds to fund the deficit.
In addition, if natural gas prices remain low (64% of first
quarter 2009 production), this will result in lower cash flows and
could also negatively affect the company's next borrowing base
redetermination in the fourth quarter of 2009. The revolving
credit facility matures in June 2010.
Brigham's vulnerable business risk profile incorporates its small,
geographically concentrated reserve base of 137.1 billion cubic
feet equivalent, a majority of which (69%) is natural gas and a
large proportion is proved undeveloped (54%).
CAPROCK COMMUNICATIONS: Moody's Affirms 'B2' Corp. Family Rating
----------------------------------------------------------------
Moody's Investors Service revised the outlook for CapRock
Communications, Inc., to stable from negative and affirmed its B2
corporate family and probability of default ratings.
Improved performance and the resolution of working capital issues
related to a new billing system have improved credit metrics,
resulting in a better cushion of compliance under financial
covenants. Covenant ratio tests tighten significantly in the
fourth quarter of 2009 and compliance will require continued
EBITDA growth, but Moody's considers this scenario realistic based
on contracted revenue. Covenants tighten again in the fourth
quarter of 2010, so CapRock will need to demonstrate some
combination of increased EBITDA and reduced revolver usage to
maintain compliance over the longer term.
Moody's also upgraded instrument ratings. The upgrade of the
instrument ratings, in accordance with Moody's Loss Given Default
methodology, results from the increase in operating lease
obligations, which Moody's considers junior to the secured bank
debt.
CapRock Communications Inc.
-- Affirmed B2 Corporate Family Rating
-- Affirmed B2 Probability of Default Rating
-- Senior Secured First Lien Bank Credit Facility, Upgraded to
Ba3, LGD2, 23%, from B1, LGD3, 33%
-- Senior Secured Second Lien Bank Credit Facility, Upgraded to
B3, LGD4, 62%, from Caa1, LGD5, 83%
-- Outlook, Changed To Stable From Negative
Moody's most recent rating action for CapRock was on February 7,
2008. At that time Moody's changed the outlook to negative and
affirmed the B2 corporate family rating.
CapRock Communications Inc. provides global fixed and mobile VSAT
satellite communications in remote locations engineered at high
levels of reliability to customers in three primary markets,
Energy, Maritime, and Government. ABRY Partners acquired CapRock
for approximately $200 million in February 2006, and CapRock
acquired Arrowhead Global Solutions in April 2007, expanding its
government division. CapRock's annual revenue is approximately
$300 million.
CATHAY GENERAL: Fitch Puts 'BB+' Stock Rating on Negative Watch
---------------------------------------------------------------
Fitch Ratings has placed the ratings of Cathay General Bancorp and
its bank subsidiary, Cathay Bank, on Rating Watch Negative,
reflecting concerns with asset quality deterioration given the
company's concentration in commercial real estate.
The Negative Watch considers the likelihood of further credit
deterioration given the composition and concentrations in CATY's
loan book. While the company has generally managed its credit
risk well and has remained profitable despite having considerable
exposure to California real estate, Fitch believes there is
considerable risk of meaningful erosion in CATY's portfolio, which
will continue to pressure earnings performance and could weaken
the company's capital and reserve base. Fitch expects to resolve
the Negative Watch in the coming months, following a more detailed
assessment of the company's risk relative to Fitch's revised loss
assumptions for various asset classes.
CATY's ratings are underpinned by its well-established franchise
among the Asian communities it serves, providing a stable core
funding base. The company also has a sound capital position,
which was augmented by CATY issuing $258 million in preferred
stock under the U.S. Treasury's Capital Purchase Program.
Fitch has placed these ratings on Rating Watch Negative:
Cathay General Bancorp
-- Long-term Issuer Default Rating 'BBB-';
-- Short-term IDR 'F3';
-- Preferred Stock 'BB+'
-- Individual 'C'.
Cathay Bank
-- Long-term IDR 'BBB-';
-- Short-term IDR 'F3';
-- Long-term Deposits 'BBB';
-- Short-term Deposits 'F2';
-- Individual 'C'.
In addition, Fitch affirms these ratings:
Cathay General Bancorp
Cathay Bank
-- Support at '5';
-- Support Floor at 'NF'.
CCS INC: S&P Junks Senior Unsecured & Subordinated Ratings
----------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its long-term
corporate credit rating on Calgary, Alberta-based CCS Inc. to 'B'
from 'B+', its senior secured term loan and revolving credit
facility ratings to 'B' from 'BB-', and its senior unsecured and
senior subordinated ratings to 'CCC+' from 'B-', following a
review of the company's business risk and financial risk profiles.
The outlook is negative.
S&P also revised the recovery ratings on the senior secured term
loan and revolving credit facilities to '3' from '2'. The '3'
recovery rating indicates S&P's expectation of meaningful (50%-
70%) recovery in the event of default. The recovery rating of '6'
(indicating negligible [0%-10%] recovery) on the senior unsecured
and senior subordinated notes is unchanged.
"The downgrade reflects our concern that the weak market for
oilfield services will continue due to the sharply reduced western
Canadian drilling activity, so CCS will experience reduced demand
and pressure on margins in the next several quarters," said
Standard & Poor's credit analyst Jamie Koutsoukis.
In S&P's opinion, the ratings on CCS reflect the company's
aggressive debt leverage, reliance on its customers' outsourcing
requirements, and participation in the competitive and cyclical
oilfield services market. S&P believes that a strong market
position in western Canada, a history of good operating margins on
the services it provides, and good diversification throughout its
businesses somewhat mitigates these concerns.
The negative outlook reflects S&P's expectation that reduced
capital budgets of North American oil and gas producers, the low
hydrocarbon price environment, and tight credit market will result
in lower volumes and pressure on margins for CCS. Consequently,
S&P expects the company will experience deterioration in its
financial risk profile through 2009. A further negative rating
action is possible should CCS materially outspend its internal
cash flow in 2009 and increase its net debt levels beyond what it
has on its balance sheet. CCS is seeking approval from its
lenders for an amendment to its credit facilities, which would
allow the company to purchase its term loans at a discount through
a modified Dutch auction process. Should this go ahead, purchases
through the process will fall under S&P's exchange offers and
similar restructurings criteria and S&P would lower its ratings on
CCS. Conversely, S&P could revise the outlook to stable should
the company maintain its financial risk profile through the low
oil and gas price cycle, largely funding its capital program and
debt obligations through internally generated cash flow and
minimizing debt increases.
CELESTICA INC: Moody's Affirms Corporate Family Rating at 'B1'
--------------------------------------------------------------
Moody's Investors Service affirmed Celestica Inc.'s corporate
family (B1) and senior subordinated notes (B3) ratings and changed
the outlook to positive from stable. Simultaneously, Moody's
upgraded the speculative-grade liquidity to SGL-1 from SGL-2.
The outlook revision to positive reflects Celestica's improvement
in operating and financial performance metrics with tangible
progress in: (i) operating margin expansion via cost reductions
and focus on higher margin customer engagements; (ii) working
capital management as evidenced by reduction in the cash
conversion cycle; and (iii) debt reduction resulting in debt to
LTM EBITDA (Moody's adjusted) of 2.4x compared to 3.5x (March
2008). These improvements were executed against the backdrop of a
lower revenue base and challenging market conditions in the EMS
sector. The positive outlook also reflects Moody's expectation
that Celestica will continue to demonstrate an enhanced credit
profile following the completion of its restructuring program and
resumption of revenue growth as customer demand returns.
The B1 CFR is supported by Celestica's status as a Tier 1 EMS
provider, strong liquidity position as evidenced by its
$1.1 billion in cash (as of March 2009) and good internal
execution following the recent turnaround. The rating is
constrained by the company's smaller size compared to its larger
EMS peers as well as the historical volatility in operating
performance. Notwithstanding, the B1 rating considers the
company's recent success in demonstrating operating margin
expansion by cutting fixed costs and focusing on more profitable
customer programs, despite a 17% contraction in revenues since
2007. Celestica's improved cost position and operational
efficiencies have resulted in good free cash flow generation
(albeit weaker than the similar year ago period) helping to
alleviate the impact of revenue declines from slowing customer
demand.
Simultaneously, the B1 rating reflects Celestica's smaller scale
relative to larger and more diversified EMS players (e.g., Hon
Hai, Flextronics and Jabil); limited demand visibility, especially
in the current challenging economic environment; and rising
customer concentration (e.g., top ten OEM customers now account
for nearly 70% of revenues versus 60% in the comparable year ago
period). It also reflects Moody's expectation of continued near-
term pressures in the enterprise communications, servers and
storage segments as OEM consolidation combined with the weak
global economy and heightened competition from Asian outsourcers
have continued to negatively impact volumes. Though Celestica has
recently benefited from new program wins in the consumer segment,
the rating captures Celestica's increasing exposure to this
segment (roughly 30% of revenues), which could become vulnerable
if consumer discretionary spending were to experience further
weakness. The B1 rating also captures execution risk associated
with the company's existing restructuring program, which is
targeted for completion by year end with total charges expected to
be near the high end of $50 - $75 million. Finally, with EMS
overcapacity rising in the current weak demand environment,
Moody's believes industry consolidation could accelerate,
especially as vulnerable players seek to exit. The B1 rating
factors the possibility that Celestica may be attracted to certain
EMS assets and pursue acquisitions that would enhance its global
manufacturing network and enable it to compete more effectively
with larger EMS rivals.
The upgrade of the speculative-grade liquidity rating to SGL-1 is
primarily driven by the renewal and extension of the revolver,
which now matures in April 2011. Despite the downsizing of the
facility to $200 million from $300 million, Celestica's sizable
cash balance, historical usage of its A/R securitization program
to supplement liquidity and Moody's expectation of very low
reliance on the revolver, collectively support the SGL-1 rating.
These ratings were affirmed:
* Corporate Family Rating -- B1
* Probability of Default Rating -- B1
* $339.4 Million (originally $500 Million) 7.875% Senior
Subordinated Notes due July 2011 -- B3 (LGD-5, 85%)
* $223.1 Million (originally $250 Million) 7.625% Senior
Subordinated Notes due July 2013 -- B3 (LGD-5, 85%)
This rating was upgraded:
* Speculative Grade Liquidity Rating to SGL-1 from SGL-2
The last rating action for Celestica was on May 30, 2008, when
Moody's affirmed the CFR and revised the outlook to stable.
Headquartered in Toronto, Canada, Celestica Inc. is a global
provider of electronics manufacturing services to original
equipment manufacturers in the information technology and
communications industry. For the twelve months ended March 31,
2009, the company generated revenues and EBITDA (Moody's adjusted)
of $7.3 billion and $398 million, respectively.
CHECKER MOTORS: Narmco Group May Acquire Firm for $1.6 Million
--------------------------------------------------------------
Alex Nixon at Kalamazoo Gazette reports that Checker Motors Corp.
has named the Narmco Group as its buyer.
According to Kalamazoo Gazette has offered $1.6 million for
Checker Motors. Kalamazoo Gazette relates that the Hon. James D.
Gregg of the U.S. Bankruptcy Court for the Western District of
Michigan will hold a hearing on the matter on June 9.
Headquartered in Kalamazoo, Michigan, Checker Motors Corporation
was established by Morris Markin in 1922 through a merger of
Commonwealth Motors and Markin Automobile Body. The Debtor, once
the manufacturer of the famed Checker automobile (the iconic
American taxi cab), is a Kalamazoo, Michigan-based automotive
parts supplier that makes metal stampings and welded assemblies
for various car and truck lines.
The Company filed for Chapter 11 protection on January 16, 2009
(Bankr. W.D. Mich. Case No. 09-00358). Christopher A. Grosman,
Esq., at Carson Fischer, P.L.C., represents the Debtor in its
restructuring efforts. The Debtor proposed Plante & Moran as
financial advisor; Kurtzman Carson Consultants LLC as claims,
noticing and balloting agent; and McCarthy Smith Law Group as
special counsel. An official committee of unsecured creditors has
been appointed in the case. As of December 31, 2008, the Debtor
had $22.3 million in assets and $20.1 million in debts.
CHRYSLER LLC: Court Ruling on Asset Sale to Fiat Expected Today
---------------------------------------------------------------
David McLaughlin and Chad Bray at The Wall Street Journal report
that the Hon. Arthur Gonzalez of the U.S. Bankruptcy Court for the
Southern District of New York will rule on Chrysler LLC's proposed
sale of most of its assets to Fiat SpA on June 1, 2009.
As reported by the Troubled Company Reporter on May 28, 2009, no
additional bidders emerged during Chrysler's fast-tracked sale
process for its business. Judge Gonzalez convened a hearing on
May 27 to consider approval of the sale of Chrysler's key assets
to a company to be owned by Fiat, the United Auto Workers, and the
U.S. and Canadian governments. The May 27 hearing, however, ended
with no decision on sale. The sale met objections from a group of
Indiana public pension funds who reiterated arguments by a group
of hedge funds that the U.S. government saying that Chrysler and
its affiliated debtors are requesting approval of an "illegal sub
rosa plan." The Indiana State Teachers Retirement Fund, the
Indiana State Police Pension Trust and the Indiana Major Moves
Construction Fund, which together own about $42.5 million of
Chrysler's $6.9 billion in secured debt, said that the proposed
transaction seeks to extinguish the property rights of the secured
lenders while making payments of billions of dollars to unsecured
creditors. Motions from various parties that include retirees,
dealers, suppliers, and government agencies joined the more than
300 objections filed on the Chrysler-Fiat deal, bringing the
number to 350.
WSJ quoted Chrysler lawyer Corinne Ball as saying, "We know there
was no other bidder. And your honor, there was no and is no
alternative except liquidation."
According to WSJ, Chrysler will also seek this week Judge
Gonzalez's approval on a plan to close almost 800 of its 3,200
dealerships, saying that the move is necessary because the dealer
network is too big and dealerships in some markets overlap.
Headquartered in Auburn Hills, Michigan, Chrysler LLC --
http://www.chrysler.com/-- manufactures 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.
In 2007, Cerberus Capital Management LP acquired an 80.1% stake in
Chrysler for $7.2 billion. Daimler AG kept a 19.9% stake.
Pursuant to the U.S. Government's Automotive Industry Financing
Program, the U.S. Department of the Treasury made emergency loans
to General Motors Corp., Chrysler Holding LLC, and Chrysler
Financial Services Americas LLC. The Treasury purchased senior
preferred stock from GMAC LLC. In exchange, Chrysler and GM
submitted restructuring plans to the Treasury on February 17,
2009. Upon submission, President Obama's Designee on the Auto
Industry determined that the restructuring plans did not meet the
threshold for long-term viability. However, on March 30, 2009,
both GM and Chrysler were granted extensions to complete the
restructuring plans to comply with the requirements set forth
under the Automotive Industry Financing Program.
The U.S. Government told Chrysler March 31, 2009, it would provide
up to $6 billion in financing if (i) Chrysler and Fiat SpA could
complete a deal by the end of April -- on top of the $4 billion
Chrysler has already received -- and (ii) Chrysler would obtain
concessions from constituents to establish a viable out-of-court
plan.
On April 30, Chrysler LLC and 24 affiliates sought Chapter 11
protection from creditors (Bankr. S.D. N.Y (Mega-case), Lead Case
No. 09-50002). U.S. President Barack Obama said that Chrysler had
to file for bankruptcy after the automaker's smaller
lenders, including hedge funds that he didn't name -- "a small
group of speculators" -- refused to make the concessions agreed to
by the Company's major debt holders and workers.
In connection with the bankruptcy filing, Chrysler reached an
agreement with Fiat SpA, the U.S. and Canadian governments and
other key constituents regarding a transaction under Section 363
of the Bankruptcy Code that would effect an alliance between
Chrysler and Italian automobile manufacturer Fiat.
Chrysler has hired Jones Day, as lead counsel; Togut Segal & Segal
LLP, as conflicts counsel; Capstone Advisory Group LLC, and
Greenhill & Co. LLC, for financial advisory services; and Epiq
Bankruptcy Solutions LLC, as its claims agent.
Chrysler says that as of December 31, 2008, it had $39,336,000,000
in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion
in cash at that time.
Bankruptcy Creditors' Service, Inc., publishes Chrysler Bankruptcy
News. The newsletter tracks the Chapter 11 proceedings of
Chrysler LLC and its debtor-affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
CHRYSLER LLC: District Court Denies Motion to Withdraw Reference
----------------------------------------------------------------
Judge Thomas Griesa of the U.S. District Court for the Southern
District of New York refused a request filed by the Indiana
Pensioners to remove Chrysler LLC's case from Southern District of
New York Bankruptcy Court Judge Arthur Gonzalez, reports
Christopher Scinta of Bloomberg News.
Judge Griesa also rejected the Pensioners' bid to delay the sale
hearing set before Judge Gonzalez on Chrysler's proposed sale of
its assets to a group led by Italian automaker Fiat S.p.A., says
the report.
In dismissing the Motion to Withdraw Reference and for a Stay of
Proceedings, Judge Griesa said that lenders like the Pensioners
may appeal any decision on the sale by Judge Gonzalez to the
District Court, Bloomberg related. The option of appeal, he said,
shouldn't be blocked by a requirement that the funds post an
"exorbitant" bond and none of the parties to the litigation should
take any action to prevent an appeal, the report added.
There needs to be a resolution to the legal issues around
Treasury's involvement in Chrysler, Judge Griesa further held,
Bloomberg related.
Prior to the District Court's ruling, these parties filed
objections to the Indiana Pensioners' Requests:
* Creditors' Committee
* Export Development Canada
* The U.S. Treasury
* Fiat
* Debtors & JPMorgan
The Official Committee of Unsecured Creditors argued that
withdrawal of the reference would disrupt the orderly and
efficient progress of the sale proceedings and forces the District
Court to rule on each of the many sale issues, both legal and
factual, that fall squarely within the Bankruptcy Court's
specialized expertise. The Committee further argued that the
Pensioners fail to demonstrate how supposed violations of the
Troubled Asset Relief Program are relevant to the issues before
the Bankruptcy Court on the Sale Motion.
On behalf of Export Development Canada, Michael J. Edelman, Esq.,
at Vedder Price P.C., in New York, asserted that the true reason
for the Pensioners' Requests is that they are seeking to delay the
Proposed Sale in the hopes that delay will cause the current
effort to save the Debtors' business to fail.
Fiat S.p.A. pointed out that there is no way Old Chrysler could
survive without the transaction opposed by the Indiana
Pensioners. The only way that the tens of thousands of people
employed by Old Chrysler and the hundreds of thousands of other
people employed by Chrysler dealers and suppliers will avoid
unemployment is if the sale process is completed promptly. If Old
Chrysler is forced into liquidation, all of these people will lose
their jobs, Fiat notes. According to Fiat, the viability of New
Chrysler depends on the sale process being concluded as quickly as
possible. If the Court nonetheless decided to grant a stay, Fiat
asked that the Indiana Pensioners be required to post a
substantial bond to compensate Fiat and other interested parties
harmed by a delay in the sale process in the event that the
Indiana Petitioners fail in their efforts to block the
transaction.
The United States of America, through the United States Department
of the Treasury, maintained that the Indiana Pensioners cannot
show a likelihood of success either on their motion to withdraw
the reference or on the underlying merits of their assertions
because:
* their motion to withdraw is untimely as a matter of law and
should be denied;
* there is no basis to withdraw the reference because the
issues before the Bankruptcy Court are fundamentally
bankruptcy issues;
* they have failed to address the serious obstacles to their
standing -- without doing so, they cannot bring their
substantive objections to Treasury's use of funds in
connection with the Chrysler bankruptcy; and
* the substantive objections to Treasury's actions have no
merit.
With regards the Stay Request, Chrysler LLC and the U.S. Treasury
Department argued that that the Indiana Pensioners cannot
establish the factors needed to obtain a stay; they have failed to
identify any loss that would be caused by the denial of a stay and
failed to explain why any asserted harm is not merely speculative.
Chrysler added that the Pensioners failed to demonstrate that,
absent a stay, they will suffer irreparable harm. In contrast, a
stay would impose devastating harm on the Debtors, on their key
constituencies, and on the public at large.
JPMorgan Chase Bank N.A. supported the Debtors' objection.
Li Yu, Esq., Assistant United States Attorney for the United
States Department of Treasury filed a declaration in support of
Treasury Department's opposition to the Stay Motion.
Pursuant to Rule 7.1 of the Federal Rules of Civil Procedure:
* EDC disclosed that it is a government owned entity and that
no publicly held corporation owns the beneficial interests
in 10% or more of EDC's stock.
* Fiat noted that it has no publicly held affiliates.
* Chrysler LLC stated that it is a Delaware Limited Liability
Corporation and has no publicly held affiliates.
* JPMorgan disclosed that its parent corporation is JPMorgan
Chase & Co., and that no other publicly held corporation
owns 10% or more of its stock. Moreover, JPMorgan Chase &
Co. is a publicly held corporation, and no publicly held
corporation owns 10% or more of JPMorgan Chase & Co.'s
stock.
Chrysler Addresses Indiana Treasurer's Opposition
In response to Indiana State Treasurer Richard Mourdock's protest
on Chrysler LLC's Chapter 11 proceeding and asset sale, Chrysler
asserted that Mr. Mourdock's position is wrong. Satisfying the
Indiana Treasurer's demands would lead to the liquidation of
Chrysler, resulting in the loss of more than 4,000 Chrysler jobs
and 9,000 retiree pensions in Indiana alone, Chrysler said in a
statement.
Chrysler pointed out that the combined Chrysler-related
investments in the three state pension funds in question totaled
approximately $17 million. The cumulative loss on these
investments under the proposed transaction would be approximately
$2 million. Chrysler's liquidation analysis shows first lien
lenders would get between zero and 18 cents on the dollar in
liquidation, versus 29 cents in the proposed transaction.
However, Chrysler said it believes this range is unlikely and that
there is low probability of a high-side outcome. The company
believes it is more likely to be on the very low end, as for the
entire time that Chrysler has been in Chapter 11, it has had very
few bids for its assets. Thus, under a liquidation scenario, the
loss to Chrysler's employees, suppliers and dealers would be far
more: in the tens of billions of dollars.
Treasurer Mourdock has expressed that he takes his "oath of
office and fiduciary responsibilities very, very seriously."
Chrysler believes Treasurer Mourdock is risking significantly
further loss, and would be living up to his fiduciary
responsibilities by accepting the terms that 98% of other
creditors accepted, the statement said.
The Treasurer's actions lead one to wonder if his motives are
financial or political, noted Chrysler.
Chrysler said that it is committed to supporting its operations in
Indiana, where more than $150 million are paid annually to
Chrysler employees, $20 million in state taxes are paid by
Chrysler employees, $3 billion of materials are purchased from
more than 200 Indiana-based suppliers, and approximately 3,750
people are employed at 75 Chrysler dealerships. Additionally,
Chrysler has donated more than $6.5 million to non-profit and
community organizations in Indiana statewide in the past 10 years.
According to the statement, the three funds Treasurer Mourdock
oversees are:
-- Indiana State Teachers Retirement Fund: This is a reported
$7.8 billion fund. The Chrysler debt is less than 1% of the
fund ($32.2 million or 0.466% of Chrysler first lien debt)
-- Indiana State Police Pension Trust: This is a reported
$250 million fund. The Chrysler debt is less than 1% of the
fund. ($1.3 million or 0.019% of Chrysler first lien debt)
-- Indiana Major Move Construction: This is a reported
$2.5 billion fund. The Chrysler debt is less than 1% of the
fund ($8.8 million or 0.128% of Chrysler first lien debt)
Moreover, Chrysler noted that:
* The combined Chrysler debt to the three funds is
$42.3 million (.6% of Chrysler's first lien debt)
* While the three funds have a face value of $42.3 million,
the purchase price was approximately $17 million. The
Company expects they will receive $15 million, for a total
investment loss of $2 million.
* Under Chapter 11, Chrysler's first lien creditors were
allocated $2 billion (instead of the $7 billion in
original debt). Ninety-eight% of the first lien
creditors have agreed to this allocation.
* The Indiana Treasurer is willing to put Chrysler in
liquidation over less than 1% of the three funds
assets.
Treasurer Comments on
District Court Decision
Bloomberg News, citing a CNBC interview, says Indiana Treasurer
Richard Mourdock found the District Court's Ruling "not
surprising", adding that that the rights of secured creditors
"cannot be messed with."
Headquartered in Auburn Hills, Michigan, Chrysler LLC --
http://www.chrysler.com/-- manufactures 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.
In 2007, Cerberus Capital Management LP acquired an 80.1% stake in
Chrysler for $7.2 billion. Daimler AG kept a 19.9% stake.
Pursuant to the U.S. Government's Automotive Industry Financing
Program, the U.S. Department of the Treasury made emergency loans
to General Motors Corp., Chrysler Holding LLC, and Chrysler
Financial Services Americas LLC. The Treasury purchased senior
preferred stock from GMAC LLC. In exchange, Chrysler and GM
submitted restructuring plans to the Treasury on February 17,
2009. Upon submission, President Obama's Designee on the Auto
Industry determined that the restructuring plans did not meet the
threshold for long-term viability. However, on March 30, 2009,
both GM and Chrysler were granted extensions to complete the
restructuring plans to comply with the requirements set forth
under the Automotive Industry Financing Program.
The U.S. Government told Chrysler March 31, 2009, it would provide
up to $6 billion in financing if (i) Chrysler and Fiat SpA could
complete a deal by the end of April -- on top of the $4 billion
Chrysler has already received -- and (ii) Chrysler would obtain
concessions from constituents to establish a viable out-of-court
plan.
On April 30, Chrysler LLC and 24 affiliates sought Chapter 11
protection from creditors (Bankr. S.D. N.Y (Mega-case), Lead Case
No. 09-50002). U.S. President Barack Obama said that Chrysler had
to file for bankruptcy after the automaker's smaller
lenders, including hedge funds that he didn't name -- "a small
group of speculators" -- refused to make the concessions agreed to
by the Company's major debt holders and workers.
In connection with the bankruptcy filing, Chrysler reached an
agreement with Fiat SpA, the U.S. and Canadian governments and
other key constituents regarding a transaction under Section 363
of the Bankruptcy Code that would effect an alliance between
Chrysler and Italian automobile manufacturer Fiat.
Chrysler has hired Jones Day, as lead counsel; Togut Segal & Segal
LLP, as conflicts counsel; Capstone Advisory Group LLC, and
Greenhill & Co. LLC, for financial advisory services; and Epiq
Bankruptcy Solutions LLC, as its claims agent.
Chrysler says that as of December 31, 2008, it had $39,336,000,000
in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion
in cash at that time.
Bankruptcy Creditors' Service, Inc., publishes Chrysler Bankruptcy
News. The newsletter tracks the Chapter 11 proceedings of
Chrysler LLC and its debtor-affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
CITADEL BROADCASTING: Herbert J. Siegel Resigns From Board
----------------------------------------------------------
Citadel Broadcasting Corporation disclosed in a filing with the
Securities and Exchange Commission that Herbert J. Siegel resigned
from the Company's board of directors.
Headquartered in Las Vegas, Nevada, Citadel Broadcasting Corp.
(NYSE: CDL) -- http://www.citadelbroadcasting.com/-- is a radio
broadcaster comprised of 165 FM and 58 AM stations in more than 50
markets. The Company's 2008 revenues were approximately
$863 million.
* * *
As reported in the Troubled Company Reporter on April 14, 2009,
Moody's Investors Service said Citadel Broadcasting Corporation's
recent amendment and waiver to its credit agreement will not
impact the company's Caa2 Corporate Family Rating, Caa3
Probability of Default Rating, its SGL-4 rating or its rating
outlook which is negative. The last rating action on Citadel was
on February 13, 2009, when Moody's downgraded the company's CFR to
Caa2 from B3 and PDR to Caa3 from Caa1.
CITADEL BROADCASTING: S&P Downgrades Corp. Credit Rating to 'CCC'
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
and issue-level ratings on Citadel Broadcasting Corp. by one
notch. The corporate credit rating was lowered to 'CCC' with a
negative outlook from 'CCC+' with a negative outlook.
Subsequently, S&P withdrew all ratings at the company's request.
"We believe that Citadel may be unable to comply with new
covenants added to its credit agreement following the completion
of its fourth amendment, specifically the requirement to have at
least $150 million of available cash as of Jan. 15, 2010," noted
Standard & Poor's credit analyst Michael Altberg.
Cash balances were $25.4 million as of March 31, 2009. Although
S&P expects the company to continue to generate healthy
discretionary cash flow, based on S&P's estimates for further
significant EBITDA declines in 2009, S&P does not believe the
company will be able to generate enough free cash flow to comply
with this covenant.
The company's revenue and EBITDA declined about 23% and 50%,
respectively, in the first quarter of 2009. Although Citadel
reduced total debt balances by roughly $405 million in 2008, S&P
does not believe that the company will be able to maintain this
rate of debt repayment in 2009, due to lower cash balances,
economic weakness that could pressure discretionary cash flow, and
S&P's expectation that it will be difficult to complete any asset
sales over the intermediate term.
Citadel's total lease-adjusted debt to EBITDA was about 8.8x as of
March 31, 2009, up from 7.9x at the end of 2008. EBITDA coverage
of interest expense was low, at 1.2x for the 12 months ended
March 31, 2009. S&P expects that EBITDA coverage of interest
could approach 1.0x in 2009. Citadel converted 50% of EBITDA to
discretionary cash flow for the 12 months ended March 31, 2009.
S&P expects further EBITDA declines and correspondingly lower
discretionary cash flow that will likely prove insufficient to
meet the company's covenant requirements.
COBALIS CORP: Inks Pact With Int'l Shipping for Sale of PreHistin
-----------------------------------------------------------------
Cobalis Corp. has completed a signed Letter of Intent with
International Shipping and Marketing LLC to distribute and market
PreHistin.
PreHistin is Cobalis' patented revolutionary allergy prevention
product available for worldwide sales at http://www.PreHistin.com.
As reported by the Troubled Company Reporter on January 21, 2009,
a federal court in Santa Ana allowed Cobalis to introduce anti-
allergy medication PreHistin. This would allow Cobalis to be
discharged from its Chapter 11 bankruptcy.
Cobalis Corporation, currently in Chapter 11 bankruptcy
protection, is responding to pending Court motions and is
scheduled for a court hearing on June 10, 2009. At that time,
Cobalis will present evidence in an attempt to support
continuation in Chapter 11 as opposed to having the case convert
to Chapter 7, which could result in liquidation of their assets
including patents and intellectual property, etc. In addition,
Cobalis will propose commencement of efforts to effect a work-out
plan in 2009 to emerge from Chapter 11. While in Chapter 11,
Cobalis may continue to operate and monetize their significant
international and domestic patents for PreHistin.
ISM, located in Newark, New Jersey will immediately begin order
fulfillment for Cobalis' PreHistin domestic and international
sales while also agreeing to begin wholesale distribution and
marketing for PreHistin sales in the Eastern United States. The
agreement with ISM also grants approval for them as an affiliate
marketer for PreHistin internet sales at http://www.PreHistin.com.
Effective May 11, 2009, ISM placed $100,000 into an escrow account
to purchase and market PreHistin for distribution. Michael
Scalora, a managing partner for ISM states, "We are proud to
introduce PreHistin to the Eastern United States and will begin
fulfilling PreHistin orders for Cobalis Corporation immediately
from our existing international shipping and distribution center
in the Garden State."
Mr. Scalora further commented, "Although we are extremely excited
to immediately implement our $500,000 annual marketing budget for
the PreHistin branding and awareness campaign for the Eastern
United States, we are working very closely and in partnership with
Cobalis to ensure that we seek and receive all necessary court
approvals. We are very pleased to partner with Cobalis to market
PreHistin as the 'The World's First Pre-Histamine' and the
preeminent international brand for all natural allergy relief. We
have not found a competitive product, backed by research and
clinical trials that remotely compares to PreHistin as a safe,
non-drowsy and side effect free alternative to typical
prescription allergy medications that are intended to treat the
symptoms after histamine has already been released. As the
PreHistin slogan states, 'Stop allergies before they start'."
About International Shipping
Headquartered in Newark, New Jersey, ISM LLC is located and
managed within the current 11,000 sq foot headquarters of the
managing partner's existing and well funded 20 year old
international shipping and distribution company. ISM's two
managing partners and their established finance, operations and
marketing team have well over 50 years of successful and
profitable management experience in international shipping and
distribution, internet marketing, and financial and business
management. ISM and their facilities and employees are in place
and prepared to manage worldwide fulfillment and Eastern U.S.
sales, marketing and distribution of PreHistin for Cobalis Corp.
ISM is committed to employing any additional resources required to
make the PreHistin brand a success.
About Cobalis
Headquartered in Irvine, California, Cobalis Corp. is an over the
counter pharmaceutical and nutraceutical company. Its flagship
product, PreHistin is designed to prevent the primary causes of
airborne allergies. PreHistin, "The World's First Pre-Histamine"
is the only Phase III clinically tested sublingual product fully
patented for long term and daily use without a prescription to
help relieve allergy sufferers of indoor and outdoor airborne
allergen. PreHistin has shown in previous studies to modulate the
body's level of immunoglobulin E (IgE), thus reducing the
overproduction of histamines, the primary cause of airborne
allergy symptoms. Prior studies have shown that the active
ingredient in PreHistin has essentially no risks or adverse
effects to the general population including sedation and
drowsiness found in most of the allergy products now available.
COEUR D'ALENE: Completes 1-for-10 Reverse Stock Split
-----------------------------------------------------
Coeur d'Alene Mines Corporation said that it has completed on
May 26, 2009, a 1-for-10 reverse stock split.
Trading of Coeur's common stock on the NYSE began on a split-
adjusted basis at the open of trading on May 27, 2009, under
Coeur's new CUSIP number, 192108504 (Old CUSIP Number: 192108108).
The common stock commenced trading on the Toronto Stock Exchange
on a split-adjusted basis on May 29, 2009.
As a result of the reverse stock split, every 10 shares of Coeur's
common stock issued and outstanding immediately prior to the
effective time were combined into one (1) share of common stock,
subject to the elimination of fractional shares.
The number of shares of Coeur common stock issued and outstanding
have been reduced from approximately 686,320,000 shares, to
approximately 68,632,000 shares post-split, without accounting for
fractional shares. The number of shares reserved for issuance
under Coeur's equity compensation plans have been reduced
proportionately.
A full-text copy of the articles of amendment is available for
free at http://ResearchArchives.com/t/s?3d66
About Coeur d'Alene
Coeur d'Alene Mines Corp. (NYSE:CDE) (TSX:CDM) --
http://www.coeur.com/-- is the world's largest primary silver
producer, as well as a significant, low-cost producer of gold.
The Company has mining interests in Nevada, Idaho, Alaska,
Argentina, Chile, Bolivia and Australia.
* * *
As the Troubled Company Reporter reported on May 20, 2009,
Standard & Poor's Ratings Services placed its ratings, including
its 'CCC' corporate credit rating, on Coeur d'Alene Mines Corp. on
CreditWatch with positive implications. The CreditWatch listing
reflects S&P's assessment that near term operating cash flow
generation will likely increase due to the combination of higher
metal volumes and continued favorable gold and silver prices.
Idaho-based Coeur d'Alene completed construction of its Palmarejo
mine and successfully started operating it in the first quarter of
2009, which is increasing volumes.
COLONIAL BANCGROUP: Robert Lowder Retires as Chairman, CEO, Pres.
-----------------------------------------------------------------
Robert E. Lowder is retiring as Colonial BancGroup, Inc.'s
chairperson, director, CEO, and president. Mr. Lowder's
retirement will become effective upon the completion of the
previously announced capital infusion transaction involving
Taylor, Bean & Whitaker Mortgage Corp. and other purchasers, or
sooner following the appointment of a replacement. Until his
retirement, Mr. Lowder will continue in his capacities as
Chairman, Director, CEO and President of Colonial BancGroup and
its subsidiary Colonial Bank. The board of directors intends to
name a replacement promptly. The capital infusion transaction is
subject to conditions as previously disclosed.
Mr. Lowder founded the Company in 1981 with the acquisition of one
bank in Birmingham, Alabama, that had $161 million in assets.
Under his 27 years of leadership, Colonial has completed 68
acquisitions and has expanded to 352 locations in five states with
over $26 billion in total assets.
Mr. Lowder also served previously as Chairman and CEO of The
Colonial Company, a family owned holding company of mortgage,
construction, real estate and insurance companies. He also was
founder and chairman of Colonial Broadcasting, a company that
owned radio stations in four states.
"When Colonial began with only twelve branches in Birmingham,
Alabama, I believed that the bank had great potential to grow and
serve customers in its home state. The growth experienced since
1995 when Colonial expanded into, first, Georgia and, then,
Florida brought Colonial to the forefront as a super community
bank in the Southeast. Further expansion into Texas and Nevada
increased Colonial's reach into high growth markets. However, the
success of Colonial over the years is not because of how it
started but, rather, because of the dedication shown by the
Company's directors, employees and customers that have supported
Colonial through the good times and the challenging times. I am
very proud of the company Colonial has become, the associations
that have been made over the years and the accomplishments of our
very talented employees, both those currently employed and those
who contributed to the bank in the past. My role at Colonial has
been the highlight of my professional life and I look forward to
watching Colonial continue to grow and prosper with new
leadership," said Mr. Lowder.
About Colonial BancGroup
Colonial BancGroup -- http://www.colonialbank.com-- operates 347
branches in Florida, Alabama, Georgia, Nevada and Texas with over
$26 billion in assets. The Company's common stock is traded on
the New York Stock Exchange under the symbol CNB. In some
newspapers, the stock is listed as ColBgp.
As reported by the Troubled Company Reporter on May 6, 2009, Fitch
Ratings downgraded The Colonial BancGroup 's long-term Issuer
Default Rating to 'B-' from 'BB'. The downgrade of CNB's ratings
reflects the escalating credit problems that continue to generate
significant losses, weakening the company's capital position, and
eroding the benefit of potential capital augmentations. The
preponderance of credit concerns remains in CNB's residential real
estate construction portfolio; the majority of which resides in
the troubled Florida market.
COLUMBUS ACQUISITION: Board Approves Liquidation & Dissolution
--------------------------------------------------------------
Columbus Acquisition Corp.'s Board of Directors has approved a
plan of liquidation for Columbus. As of the close of business on
June 2, 2009, Columbus' share transfer books will close and the
NYSE Amex will suspend trading.
Because Columbus didn't consummate a business combination within
the time frame required by its certificate of incorporation and
the terms of its initial public offering, Columbus is required to
liquidate and dissolve. Columbus will promptly begin the process
of liquidating and dissolving itself in accordance with its
certificate of incorporation and applicable Delaware law.
Columbus expects to liquidate the amounts held in its trust
account, which consist of proceeds from the Columbus's initial
public offering, together with the deferred portion of the
underwriter's discount and commission and interest (net of
applicable taxes). Payable upon presentation, liquidating
distributions will be made to holders of shares of the Columbus'
common stock (excluding shares issued prior to the Columbus'
initial public offering). Stockholders whose stock is held in
"street name" through a broker will automatically receive payment
through the Depository Trust Company. The liquidating
distribution is expected to be approximately $7.98 per share. No
payments will be made with respect to any of Columbus' outstanding
warrants or shares of common stock that were acquired prior to the
Columbus' initial public offering.
Columbus will file a Certificate and Notice of Termination of
Registration on Form 15 with the Securities and Exchange
Commission for the purpose of deregistering its securities under
the Securities and Exchange Act of 1934, as amended. As a result,
Columbus will no longer be a public reporting company and its
securities will cease trading on the NYSE Amex.
About Columbus Acquisition Corp.
Columbus Acquisition Corp. -- http://www.columbusacquisition.com/
-- is a blank check company organized under the laws of the State
of Delaware on August 1, 2006. Columbus was formed to acquire,
through a merger, capital stock exchange, asset or stock
acquisition, exchangeable share transaction or other similar
business combination, one or more operating businesses that it
believes has significant growth potential. Columbus' IPO was
declared effective May 18, 2007, and was consummated on May 21,
2007, resulting in net proceeds of approximately $109.8 million
through the sale of 14.375 million units at $8.00 per unit. Each
unit was comprised of one share of Columbus common stock and one
warrant with an exercise price of $6.00. As of March 31, 2009,
Columbus held $114.7 million in a trust account maintained by an
independent trustee.
COMSTOCK HOMEBUILDING: Appoints CAO Jeff Dauer as Interim CFO
-------------------------------------------------------------
Comstock Homebuilding Companies, Inc., disclosed in a filing with
the Securities and Exchange Commission that effective May 22,
2009, Bruce Labovitz, formerly the chief financial officer, is no
longer employed by the Company. Jeff Dauer, the chief accounting
officer, has assumed the chief financial officer position on an
interim basis.
"I believe Mr. Dauer's considerable accounting and finance
background, his track record of generating accurate and timely
quarterly and annual reports for Comstock over the past several
years, and his thorough understanding of Sarbanes Oxley and the
accounting issues relative to our industry make him well suited
for this role at Comstock Homebuilding Companies," Christopher
Clemente, Comstock's chairman and chief executive officer, said.
"Effective immediately I will be working directly with our lenders
in an effort to develop a solution that is a win-win for all
parties in hopes of finding common ground that affords Comstock
Homebuilding Companies an opportunity to continue operations."
Based in Reston, Viginia, Comstock Homebuilding Companies, Inc.
(NasdaqGM: CHCI) -- http://www.comstockhomebuilding.com--
develops, builds and markets single-family homes, townhouses and
condominiums in the Washington D.C., Raleigh, North Carolina and
Atlanta, Georgia metropolitan markets. The Company also provides
certain management and administrative support services to certain
related parties.
* * *
On Jan. 29, 2009, Comstock Homebuilding Companies, Inc., and
Comstock Penderbrook, L.C., a wholly owned subsidiary of the
Company, entered into a forbearance agreement with Guggenheim
Corporate Funding with respect to the $13.5 million outstanding
under the company's secured Penderbrook project loan. The Company
received a notice of default from Guggenheim on August 22, 2008.
In connection with the forbearance agreement the original maturity
date of the loan was extended from February 22, 2010, to March 6,
2011. The terms of the forbearance agreement provide for
additional incremental extensions until March 6, 2012, provided
certain unit delivery requirement thresholds are met.
CONTECH US: Amends Accommodation Pact with Delphi, Ford
-------------------------------------------------------
The Hon. Steven W. Rhodes will convene a hearing at 2:30 p.m.
today to consider an emergency motion by Contech U.S. LLC and its
debtor-affiliates to enter into an amendment to their
accommodation agreement with certain customers and lenders.
The U.S. Bankruptcy Court for the Eastern District of Michigan on
February 5, 2009, authorized the Debtors to enter in an
accommodation agreement and an access and security agreement with
certain customers and the Debtors' lenders, providing certain
financial and other accommodations, as well as debtor-in-
possession financing. Subsequently, the Original Customers,
except for Linamar Corporation and Linamar de Mexico decided to
exercise their option to extend the term of the Agreements from
April 30, 2009, to May 31, 2009. The Debtors and the remaining
Accommodation Parties entered into a non-material amendment
detailing the terms of the extension, and the Debtors submitted
notice of the amendment to the Court on April 30, 2009.
On May 15, 2009, the Debtors sought permission to sell
substantially all of their Castings business' assets to Revstone
Industries, LLC, pursuant to 11 U.S.C. Section 363. The Debtors'
May Customers objected to the amendment, and as a result, Revstone
requested until June 30, 2009, to address the concerns of the May
Customers and to consummate a sale. Revstone also made a related
request that the May Customers extend until June 30, 2009, the
accommodations granted under the Accommodation Agreement and
related documents. Delphi Automotive Systems LLC and Ford Motor
Company -- Contech's June Customers -- elected to maintain
production with the Debtors pursuant to the terms of the
Agreements as amended in certain non-material respects by a second
amendment.
The Amendment extends the terms of the Agreements from May 31,
2009, through and including June 30, 2009, during which time (a)
Delphi will fund the Debtors' working capital needs and other
operating costs for the plants in Auburn, Indiana; Clarksville,
Tennessee and Dowagiac and Alma, Michigan, (b) Ford will fund the
Debtors' working capital needs and other operating costs for the
plant in Pierceton, Indiana, and (c) June Customers will fund
certain corporate overhead costs. Included in the June Funding is
an adequate protection payment of $269,000 to the Lenders and the
agent to the Lender for the month of June. No interest will be
charged on the June Funding, and the June Customers will have
priority senior to the Lenders with respect to the June Funding
with respect to certain collateral.
Furthermore, the June Customers will no longer be prohibited from
resourcing production of Component Parts from third parties and
may remove any tooling held by the Debtors but owned by such June
Customer. Should an Original Customer that is not a June Customer
choose to source production of Component Parts from the Debtors,
it will be required to (i) pay all accounts owed the Debtors and
(ii) purchase all inventory related to the production of its
Component Parts, or with the consent of the June Customers, agree
to pay on C.O.D. terms plus a surcharge equal to a 35% price
increase.
The Debtors do not believe the Customers would continue to order
Component Parts from the Debtors without the assurances and other
considerations set forth in the Accommodation Agreement. The
extension of the Accommodation Agreement constitutes the best
possible arrangement for the continued operation of the Debtor's
business with the June Customers, Christopher A. Grosman, Esq., at
Carson Fischer LLP, in Bloomfield Hills, Michigan.
Headquartered in Portage, Michigan, Contech LLC --
http://www.contech-global.com/-- sells and supplies light-weight
cast component for automotive OEM's and Tier I suppliers. The
Company also manufactures safety steel forged automotive
components and tube fabrications primarily for commercial trucks.
The Company and two of its affiliates filed for Chapter 11
protection on January 30, 2009 (Bankr. E.D. Mich. Lead Case No.
09-42392). Richard A. Chesley, Esq., and Kimberly D. Newmarch,
Esq., at Paul, Hastings, Janofsky & Walker, LLP, are the Debtors'
counsel. Robert A. Weisberg, Esq., and Christopher A. Grosman,
Esq., at Carson Fischer, P.L.C., serve as local counsel. Kurtzman
Carson Consultants LLC is the claims, noticing and balloting agent
for the Debtors. In its bankruptcy petition, Contech said its
assets and debts are both between $100 million and $500 million.
CRICKET COMMUNICATIONS: Moody's Assigns 'Ba2' Rating on Notes
-------------------------------------------------------------
Moody's Investors Service assigned a Ba2 rating to Cricket
Communications Inc.'s $1.1 billion senior secured notes, due 2016.
Cricket is a wholly-owned subsidiary of Leap Wireless
International, Inc.'s. The proceeds of the notes' issuance will
be largely used to refinance the existing senior secured credit
facilities at Cricket and enhance the company's cash balances. At
closing of the transactions, Moody's will withdraw the ratings on
the existing senior secured credit facilities. In conjunction
with the issuance of the senior secured notes, the company
launched a secondary equity offering of 7 million shares, the
proceeds of which will be used for general corporate purposes,
which could include the expansion and improvement of its network
footprint, acquisitions of additional spectrum or complementary
businesses and potential deployment of 4G (LTE) network
technology.
As part of the rating action, Moody's affirmed existing Leap and
Cricket ratings, including the B2 corporate family rating, the B2
probability of default rating, the SGL1 liquidity rating, the B3
rating on Cricket's senior unsecured notes, and the Caa1 rating on
Leap's convertible notes.
Ratings Assigned:
Issuer: Cricket Communications, Inc.
-- Senior Secured Regular Bond/Debenture, Assigned Ba2 LGD2-15%
The B2 corporate family rating considers Moody's expectations that
Leap's rapid growth plans will consume a significant amount of
cash over the next few years as it seeks to build-out wireless
networks and launch service in several additional markets,
reaching nearly 100 million potential subscribers (POPs) by the
end of 2010. The ratings and the outlook also consider Moody's
views that Leap faces significant execution risks in building out
new markets amid intensifying industry competition, as the
national wireless penetration rate approaches 90%. As such,
Leap's adjusted Debt/EBITDA leverage stood above the 6.0x
downgrade triggers at 1Q'09. However, Moody's recognizes that as
the company launches new markets, its EBITDA deteriorates on a
temporary basis, given the large start up costs involved in new
market launches. Moody's expects Leap's adjusted leverage to fall
below 6.0x by year end 2009.
Moody's most recent rating action for Leap was on June 19, 2008.
At that time Moody's assigned a B3 rating to Cricket's new note
issue, and a Caa1 rating to Leap's million convertible notes
issue, and revised the company's outlook to stable from
developing.
Leap Wireless International, Inc., wholly-owns Cricket
Communications Inc., which is a wireless service provider. Both
companies are headquartered in San Diego, California.
CRICKET COMMUNICATIONS: S&P Assigns 'B+' Rating on $1.1 Bil. Notes
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned its issue-level and
recovery ratings to Cricket Communications Inc.'s proposed
$1.1 billion secured notes due 2016, to be issued under Rule 144A
with registration rights. S&P assigned the debt an issue-level
rating of 'B+' (two notches higher than the 'B-' corporate credit
rating on parent company Leap Wireless International Inc.) with a
recovery rating of '1', indicating S&P's expectation of very high
(90% to 100%) recovery for noteholders in a payment default.
Cricket is a funding subsidiary for San Diego, California-based
wireless carrier Leap Wireless International Inc. Proceeds will
be used to repay the company's existing secured bank debt, as well
as for general corporate purposes.
At the same time, S&P affirmed its existing ratings on Leap
(including the 'B-' corporate credit rating) and Cricket. The
'B-' rating outlook is positive. Total funded debt at March 31,
2009 was $2.6 billion.
The company's financial flexibility and accompanying corporate
credit rating will benefit from the lack of financial maintenance
covenants in the new notes. In addition, the company has
concurrently proposed an approximate $270 million common equity
issuance. While the debt issue is not contingent on sale of
stock, successful placement of the equity would provide Leap a
measure of added liquidity as it expands its market footprint over
the next 18 months.
The ratings on Leap reflect a very high degree of business risk
given the company's nontraditional flat-rate limited mobility,
unlimited local usage wireless business model, a fairly limited
operating history, and execution risk from the build-out of new
markets. Although Leap has demonstrated success in attracting
subscribers to its less expensive wireless service, national
players may begin to more aggressively target the company's
subscriber base with their own tailored pricing plans as the
wireless industry matures. The ratings also reflect a highly
leveraged financial profile, including expectations for
significant discretionary cash flow losses over the next year as a
result of its planned market expansion. Tempering factors include
a low cost structure and adequate liquidity.
DBO HOLDINGS: S&P Downgrades Corporate Credit Rating to 'B'
-----------------------------------------------------------
Standard & Poor's Ratings Service said that it lowered its
corporate credit rating on DBO Holdings, Inc. to 'B' from 'B+'.
At the same time, the rating on the company's $400 million asset
based revolving credit facility due 2011 was lowered to 'BB-' from
'BB' and the rating on the $1.3 billion term loan was lowered to
'B' from 'B+'. The recovery ratings on the facilities remain
unchanged at '1' and '3' respectively. The outlook is stable.
"The ratings downgrade reflects our assessment that the company's
operating results will continue to be materially lower than
previously expected over the next few quarters. The poor
operating performance is due to weak end market demand and margin
compression, as the sharp decline in steel prices has resulted in
the company selling older inventory at a loss," said Standard &
Poor's credit analyst Sherwin Brandford. S&P expects that the
company's overall financial profile will deteriorate to a level
that S&P would consider to be more in-line with the 'B' rating,
with leverage increasing to more than 10x (S&P has not included
the NMLK settlement in S&P's calculation of EBITDA nor have S&P
made other adjustments permitted under the company's credit
agreement such as LIFO adjustments) for fiscal 2009. However, S&P
expects DBO Holdings to maintain liquidity above $200 million.
The rating and outlook incorporate S&P's expectation that in
fiscal 2009, EBITDA is likely to decline below $100 million,
EBITDA coverage of interest to fall below 2x and leverage to
increase above 10x mainly due to the ongoing U.S. recession and
the impact this will continue to have on steel demand. S&P
expects the U.S. economy to begin to improve in 2010 and that
demands for steel will likely improve. As such, S&P expects
operating results to improve materially in 2010, strengthening
credit measures from the expected 2009 levels.
DBSD NORTH AMERICA: Can Use Cash Collateral on Interim Basis
------------------------------------------------------------
The Hon. Robert E. Gerber of the U.S. Bankruptcy Court for the
Southern District of New York authorized DBSD North America Inc.
and its debtor-affiliates to use cash collateral of:
i) The Bank of New York Mellon, as collateral agent on behalf
of the prepetition secured parties under a certain
collateral trust agreement; and indentures trustee for
certain senior notes; and
ii) Wells Fargo Bank N.A., as successor to Jefferies Finance
LLC, and administrative agent and lenders to the Debtors'
$40 million prepetition facility.
BoNY and Wells Fargo agreed to provide a $40 million working
capital loan facility and other accommodation to the Debtors on
April 27, 2008. In addition, the Debtors and BoNY are parties to
a certain convertible senior notes indenture for 7.5% convertible
senior secured notes due 2009. The Debtors owe the lenders $43.7
million under the facility agreement and $736.2 million under the
senior notes agreement as of their bankruptcy filing.
Proceeds of the cash collateral will be used for working capital
and general corporate purposes including capital expenditures,
distributions for administrative costs and expenses related to the
administration of the Chapter 11 cases in accordance to a budget.
According to the Debtors, they have an immediate need to use cash
collateral to permit, among other things, the orderly continuation
of the operation of their businesses and to avoid immediate and
irreparable harm. The access to sufficient working capital and
liquidity through the use of cash collateral is vital to the
preservation and maintenance of their going concern values and to
a successful administration of their Chapter 11 Cases and
reorganization, the Debtors related. The expenditures provided
for in the budget are appropriate to avoid irreparable harm to
their estates, the Debtor noted.
As adequate protection, the prepetition lenders will receive
additional and replacement valid, binding, enforceable, non-
avoidable and automatically-perfected first priority liens on and
security interest in the Debtors' assets on which liens, on
account of the prepetition facility, now exist.
Access of cash collateral is expected to terminate on earliest to
occur of:
-- June 24, 2009
-- the date on which an event of default has occurred and is
continuing;
-- the effective date of any confirmed plan of reorganization
in any or all of the Chapter 11 Cases; and
-- the consummation of the sale or other disposition of all or
substantially all of the assets of the Debtors whether done
by one or a series of transactions.
The cash collateral contains events of defaults including, among
other things, failure to pay their proposed counsel Kirkland &
Ellis LLP an amount that exceeds $1 million by June 19, 2009.
A final hearing may take place either on June 9, 2009 or June 15,
2009, based on the Court's availability. Objections, if any, must
be filed by June 5, 2009.
A full-text copy of the Debtors' cash collateral budget is
available for free at http://ResearchArchives.com/t/s?3d5f
Headquartered in Reston, Virginia, DBSD North America Inc. aka ICO
Member Services Inc. offer satellite communications services. The
company and nine of its affiliates filed for Chapter 11 protection
on May 15, 2009 (Bankr. S.D. N.Y. Lead Case No. 09-13061). The
Debtors selected The Garden City Group Inc. as their claims agent.
When the Debtors sought for protection from its creditors, they
listed both assets and debts between $500 million and $1 billion.
DBSD NORTH AMERICA: Taps Jefferies & Company as Investment Banker
-----------------------------------------------------------------
DBSD North America Inc. and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Southern District of New York for
permission to employ Jefferies & Company Inc. as Investment Banker
and Financial Advisor.
The firm is expected to provide corporate advisory services to the
Debtors including (a) general financial advice; (b) corporate
restructurings; (c) mergers, acquisitions, and divestitures; (d)
special committee assignments; and (e) capital raising.
The firm will be paid $200,000 per month for this engagement.
Michael Henkin, managing director of the firm, assures the Court
that the firm is a "disinterested person" as defined in Section
101(14) of the Bankruptcy Code.
Headquartered in Reston, Virginia, DBSD North America Inc. aka ICO
Member Services Inc. offer satellite communications services. The
company and nine of its affiliates filed for Chapter 11 protection
on May 15, 2009 (Bankr. S.D. N.Y. Lead Case No. 09-13061). The
Debtors selected The Garden City Group Inc. as their claims agent.
When the Debtors sought for protection from its creditors, they
listed both assets and debts between $500 million and $1 billion.
DBSD NORTH AMERICA: Wants to Hire Kirkland & Ellis as Attorney
--------------------------------------------------------------
DBSD North America Inc. and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Southern District of New York for
permission to employ Kirkland & Ellis LLP as their attorney.
The firm will, among other things:
a) advise the Debtors with respect to their powers and duties
as debtors-in-possession in the continued management and
operation of their business and properties;
b) advise and consult on the conduct of the Chapter 11 Cases,
including all of the legal and administrative requirements
of operating in chapter 11;
c) attend meetings and negotiating with representatives of the
Debtors' creditors and other parties-in-interest;
d) take all necessary actions to protect and preserve the
Debtors' estates, including prosecuting actions on the
Debtors' behalf, defending any action commenced against the
Debtors, and representing the Debtors' interests in
negotiations concerning all litigation in which the Debtors
are involved, including objections to claims filed against
the Debtors' estates; and
(e) prepare all pleadings, including motions, applications,
answers, orders, reports, and papers necessary or otherwise
beneficial to the administration of the Debtors' estates.
The firms' professionals and their compensation rates:
Professional Hourly Rate
------------ -----------
James H.M. Sprayregen, P.C. $965
Christopher J. Marcus, P.C. $725
Marc J. Carmel, P.C. $675
Partners $550-$965
Counsel $390-$965
Associates $320-$660
Paraprofessionals $110-$280
James H.M. Sprayregen, P.C., a partner at Kirkland & Ellis LLP,
assures the Court that the firm is a "disinterested person" as
defined in Section 101(14) of the Bankruptcy Code.
Headquartered in Reston, Virginia, DBSD North America Inc. aka ICO
Member Services Inc. offer satellite communications services. The
company and nine of its affiliates filed for Chapter 11 protection
on May 15, 2009 (Bankr. S.D. N.Y. Lead Case No. 09-13061). The
Debtors selected The Garden City Group Inc. as their claims agent.
When the Debtors sought for protection from its creditors, they
listed both assets and debts between $500 million and $1 billion.
DELPHI CORP: General Motors Considering Purchase of 5 Plants
------------------------------------------------------------
Michael J. de la Merced of The New York Times reports that
Delphi Corporation may finally emerge from Chapter 11 and avert
liquidation.
According to the report, the Obama administration?s auto task
force is pushing for a sale of some of Delphi's assets to a third-
party buyer, possibly another parts supplier or an investment
firm, citing people familiar with the matter. Mr. de la Merced
related that his sources disclosed General Motors may reacquire
some assets as well. The New York Times noted that GM has agreed
to take back 5 Delphi plants but the parties have not yet agreed
on the terms of the proposed purchase.
Delphi was granted permission on Thursday to delay the hearing on
its restructuring plan until today.
About Delphi Corp.
Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ)
-- http://www.delphi.com/-- is a global supplier of mobile
electronics and transportation systems, including powertrain,
safety, steering, thermal, and controls & security systems,
electrical/electronic architecture, and in-car entertainment
technologies. Delphi technology is also found in computing,
communications, consumer accessories, energy and medical
applications. Delphi has approximately 146,600 employees and
operates 150 wholly owned manufacturing sites in 34 countries with
sales of $18.1 billion in 2008.
The Company filed for Chapter 11 protection on October 8, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr.,
Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden,
Arps, Slate, Meagher & Flom LLP, represent the Debtors in their
restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A.
Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP,
represent the Official Committee of Unsecured Creditors. As of
June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000
in total assets and US$23,742,000,000 in total debts.
The Court approved Delphi's First Amended Joint Disclosure
Statement and related solicitation procedures for the
solicitation of votes on the First Amended Plan on December 20,
2007. The Court confirmed the Debtors' First Amended Plan on
January 25, 2008. The Plan has not been consummated after a group
led by Appaloosa Management, L.P., backed out from their
proposal to provide US$2,550,000,000 in equity financing to
Delphi.
(Delphi Bankruptcy News, Issue No. 168; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)
ELDERCARE PROPERTIES: Insurance Hiccups Didn't Terminate Lease
--------------------------------------------------------------
WestLaw reports that a long-term lease under which a debtor
operated a nursing home prior to its Chapter 11 filing, as an
executory contract not properly terminated by the lessor
prepetition for the debtor's alleged default in failing to
maintain general and professional liability coverage in amounts
specified in the lease, was assumable by the debtor. The debtor
had been paying rent and was current in its rent obligation.
Moreover, the debtor, while unable in the face of dramatically
escalating insurance costs to maintain professional liability
coverage in the amount of $4 million per occurrence specified in
its lease, had a right under the lease to demand that these
insurance limits be renegotiated if they ever became excessive.
The debtor's specifically enforceable right to demand
renegotiation of the insurance limits provided adequate assurance
of future performance on the insurance coverage issue. In re
ElderCare Properties, Ltd., --- B.R. ----, 2006 WL 6257009 (Bankr.
S.D. Tex.).
ElderCare Properties, Ltd., located in Flower Mound, Tex., sought
chapter 11 protection (Bankr. S.D. Tex. Case No. 05-71283) on
October 14, 2005. Michael J. Urbis, Esq., at Jordan, Hyden,
Womble & Culbreth, P.C., in Brownsville, Tex., represents the
nursing home operator. ElderCare estimated $1,539,368 in assets
and liabilities totaling $2,329,196 when it filed for Chapter 11
protection.
ENRON CORP: Court Okays Arthur Andersen Settlement for $16 Million
------------------------------------------------------------------
Judge Arthur J. Gonzalez of the U.S. Bankruptcy Court for the
Southern District of New York approved a settlement agreement and
mutual release Enron Recovery Corp. entered into with Arthur
Andersen.
Under the settlement, Arthur Andersen will pay to Enron
$16,000,000 and the parties will mutually release each other from
all claims.
The Troubled Company Reporter reported on April 30, 2009, that in
December 2003, the Official Committee of Unsecured Creditors of
Enron Corp. filed a complaint, on behalf of Enron, against Arthur
Andersen alleging that certain of its former officers needed the
approval of Arthur Andersen, as Enron's former independent auditor
and financial advisor, to engage in gross misconduct and breaches
of their fiduciary duties in the form of misstating and
manipulating Enron's financial condition for the former
executives' own benefit. The Complaint also alleged that the
accounting firm failed to fully and candidly apprise Enron's Board
of Directors with respect to certain high risk transactions
orchestrated by the former Enron officers and failed to fulfill
its obligations to Enron, the Board, and its Audit Committee by
placing the firm's own interests ahead of Enron's and by acceding
to the inappropriate transactions designed by the Enron Insiders.
According to the Complaint, Arthur Andersen was involved in
virtually every aspect of Enron's financial operations and
internal control structure, giving rise to their own fiduciary
duties of loyalty, utmost good faith and candor, honest dealing,
and full disclosure. In addition, the Complaint alleges that
Arthur Andersen was paid more than $180 million in fees between
1997 and 2001. The Committee further alleged that Arthur Andersen
breached these duties by, among other things:
(a) placing its own financial interests ahead of Enron's;
(b) failing to provide objective, impartial and truthful
advice to Enron;
(c) issuing audit opinions of Enron's financial statements
that Arthur Andersen was negligent in failing to know
contained material misstatements and omissions;
(d) failing to recognize that ever increasing sophisticated
and complex transactions entered into by Enron had little
to do with the nature of Enron's business and everything
to do with the Enron Insiders' attempt to achieve
financial statements that did not reflect the reality of
the company's performance or the results of the
transactions itself; and
(e) destroying evidence.
Arthur Andersen has denied, and continues to deny, each and all
claims and allegations of wrongdoing made against it and has
maintained that it has meritorious defenses. Enron asserted that
the settlement will clearly benefit its estate. Enron pointed out
that the settlement will result in a substantial payment to the
estate and will adequately compensate the estate for its claims
against Arthur Andersen given the costs and uncertainties of
litigation.
About Enron
Based in Houston, Texas, Enron Corporation filed for chapter 11
protection on December 2, 2001 (Bankr. S.D. N.Y. Case No. 01-
16033)
following controversy over accounting procedures, which caused
Enron's stock price and credit rating to drop sharply.
Enron hired lawyers at Togut Segal & Segal LLP; Weil, Gotshal &
Manges LLP, Venable; Cadwalader, Wickersham & Taft, LLP for its
bankruptcy case. The Official Committee of Unsecured Creditors in
the case tapped lawyers at Milbank, Tweed, Hadley & McCloy LLP.
The Debtors filed their Chapter Plan and Disclosure Statement on
July 11, 2003. On January 9, 2004, they filed their fifth Amended
Plan and on the same day the Court approved the adequacy of the
Disclosure Statement. On July 15, 2004, the Court confirmed the
Debtors' Modified Fifth Amended Plan and that plan was declared
effective on November 17, 2004.
After the approval of the Plan, the new board of directors decided
to change the name of Enron Corp. to Enron Creditors Recovery
Corp. to reflect the current corporate purpose. ECRC's sole
mission is to reorganize and liquidate certain of the operations
and assets of the "pre-bankruptcy" Enron for the benefit of
creditors.
ECRC has been involved in the MegaClaims Litigation, an action
against 11 major banks and financial institutions that ECRC
believes contributed to Enron's collapse; the Commercial Paper
Litigation, an action involving the recovery of payments made to
commercial paper dealers; and the Equity Transactions Litigation,
which ECRC filed against Lehman Brothers Holdings, Inc., UBS AG,
Credit Suisse and Bear Stearns to recover payments made to the
four banks on transactions involving Enron's stock while the
company was insolvent.
(Enron Bankruptcy News; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
ENRON CORP: Deutsche Bank Seeks Reconsideration of Settlement
-------------------------------------------------------------
Deutsche Bank Securities Inc., asked the U.S. District Court for
the Southern District of Texas to reconsider its opinion and
order entered on April 8, 2009 denying Deutsche Bank's motion for
an order approving its Newby Settlement Fund Proof of Claim.
Deutsche said it intended to submit a brief reply in response
to The Regents of the University of California's opposition but
the Court's opinion intervened. Deutsche contends neither the
language of the Settlement Stipulations nor the language of the
Notice to the Newby Settlement Fund Class precludes it from
receiving a share of the Settlement Fund.
The Regents argue that Deutsche provides no reason for requesting
reconsideration except that it did not submit a reply before the
Court ruled on its original motion. The Regents tells the Court
that Deutsche cites nothing to support its contention that
neither the language of the Settlement Stipulations nor the
Notice to the Newby Settlement Fund Class precludes it from
receiving a share of the Settlement Fund.
In its initial motion, Deutsche Bank related that the collapse of
Enron Corp. caused Deutsche Bank to lose hundreds of millions of
dollars. More than $200,000,000 of those proprietary losses was
because of Deutsche Bank's purchase of publicly-traded Enron and
Enron-related debt and equity securities. Deutsche Bank submitted
a timely proof of claim for a distribution from the Newby
Settlement funds based on its losses. However, in November 2008,
Gilardi & Co., Ltd., the claims administrator for the settlement
fund in Newby informed Deutsche Bank that its claim had been
rejected for the reason that Deutsche Bank was excluded from the
settlement class. Deutsche Bank was dismissed from the Newby
settlement class in June 2006. Deutsche Bank's understanding is
that approximately $1.8 billion of the Newby settlement fund has
been held back, and will not be distributed until all objections
to the initial determinations on the proofs of claim, including
Deutsche Bank's, have been resolved.
In April 2009, Judge Melinda Harmon of the Southern Texas District
Court held that stipulations, previous Court orders, and final
judgments relating to the Newby Settlement Fund exclude Deutsche
from any distribution. Accordingly, Judge Harmon denied
Deutsche's request for approval of its Newby settlement fund proof
of claim for propriety losses it suffered on publicly-traded Enron
and Enron-related debt and equity securities.
About Enron
Based in Houston, Texas, Enron Corporation filed for chapter 11
protection on December 2, 2001 (Bankr. S.D. N.Y. Case No. 01-
16033)
following controversy over accounting procedures, which caused
Enron's stock price and credit rating to drop sharply.
Enron hired lawyers at Togut Segal & Segal LLP; Weil, Gotshal &
Manges LLP, Venable; Cadwalader, Wickersham & Taft, LLP for its
bankruptcy case. The Official Committee of Unsecured Creditors in
the case tapped lawyers at Milbank, Tweed, Hadley & McCloy LLP.
The Debtors filed their Chapter Plan and Disclosure Statement on
July 11, 2003. On January 9, 2004, they filed their fifth Amended
Plan and on the same day the Court approved the adequacy of the
Disclosure Statement. On July 15, 2004, the Court confirmed the
Debtors' Modified Fifth Amended Plan and that plan was declared
effective on November 17, 2004.
After the approval of the Plan, the new board of directors decided
to change the name of Enron Corp. to Enron Creditors Recovery
Corp. to reflect the current corporate purpose. ECRC's sole
mission is to reorganize and liquidate certain of the operations
and assets of the "pre-bankruptcy" Enron for the benefit of
creditors.
ECRC has been involved in the MegaClaims Litigation, an action
against 11 major banks and financial institutions that ECRC
believes contributed to Enron's collapse; the Commercial Paper
Litigation, an action involving the recovery of payments made to
commercial paper dealers; and the Equity Transactions Litigation,
which ECRC filed against Lehman Brothers Holdings, Inc., UBS AG,
Credit Suisse and Bear Stearns to recover payments made to the
four banks on transactions involving Enron's stock while the
company was insolvent.
(Enron Bankruptcy News; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
ENRON CORP: Creditors Panel Settles $2.6MM Lou Pai Suit for $300K
-----------------------------------------------------------------
The Official Committee of Unsecured Creditors of Enron Corp. and
its affiliates, now known as Enron Creditors Recovery Corp.,
sought and obtained the approval of Judge Arthur J. Gonzalez of
the United States Bankruptcy Court for the Southern District of
New York of a settlement with Lou L. Pai, former Enron trader and
division chief.
On December 1, 2003, the Creditors' Committee, on behalf of the
Debtors' estates, commenced an adversary proceeding against Mr.
Pai to recover certain payments alleged to have been made to him
by the Debtors within one year prior to the Petition Date in the
aggregate amount of $2,660,000.
To avoid additional cost and delay associated with further
litigation, the Creditors' Committee and Enron have concluded
that a settlement agreement is in the best interest of the
estates. Pursuant to the Settlement Agreement, Mr. Pai will pay
to Enron $300,000, which amount will be made payable by wire.
Upon Enron's receipt of the Settlement Amount, the Committee will
dismiss the Adversary Proceeding with prejudice.
Mr. Pai has also settled the U.S. Securities and Exchange
Commission's fraud allegations for $31,500,000 in December 2008.
About Enron
Based in Houston, Texas, Enron Corporation filed for chapter 11
protection on December 2, 2001 (Bankr. S.D. N.Y. Case No. 01-
16033)
following controversy over accounting procedures, which caused
Enron's stock price and credit rating to drop sharply.
Enron hired lawyers at Togut Segal & Segal LLP; Weil, Gotshal &
Manges LLP, Venable; Cadwalader, Wickersham & Taft, LLP for its
bankruptcy case. The Official Committee of Unsecured Creditors in
the case tapped lawyers at Milbank, Tweed, Hadley & McCloy LLP.
The Debtors filed their Chapter Plan and Disclosure Statement on
July 11, 2003. On January 9, 2004, they filed their fifth Amended
Plan and on the same day the Court approved the adequacy of the
Disclosure Statement. On July 15, 2004, the Court confirmed the
Debtors' Modified Fifth Amended Plan and that plan was declared
effective on November 17, 2004.
After the approval of the Plan, the new board of directors decided
to change the name of Enron Corp. to Enron Creditors Recovery
Corp. to reflect the current corporate purpose. ECRC's sole
mission is to reorganize and liquidate certain of the operations
and assets of the "pre-bankruptcy" Enron for the benefit of
creditors.
ECRC has been involved in the MegaClaims Litigation, an action
against 11 major banks and financial institutions that ECRC
believes contributed to Enron's collapse; the Commercial Paper
Litigation, an action involving the recovery of payments made to
commercial paper dealers; and the Equity Transactions Litigation,
which ECRC filed against Lehman Brothers Holdings, Inc., UBS AG,
Credit Suisse and Bear Stearns to recover payments made to the
four banks on transactions involving Enron's stock while the
company was insolvent.
(Enron Bankruptcy News; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
ENRON CORP: Court Okays Piper Jaffray & DISH Network Settlement
---------------------------------------------------------------
Judge Arthur J. Gonzalez of the United States Bankruptcy Court
for the Southern District of New York approved Enron Creditors
Recovery Corp.'s settlement with Piper Jaffray & Co. and DISH
Network Corporation, formerly known as EchoStar Communications
Corporation. The Settlement provides, among other things, that
Piper and DISH will pay to Enron $6,200,522.
The Troubled Company Reporter reported on April 15, 2009, that
prior to December 2, 2001, Enron issued unsecured commercial paper
to various entities. The CP paper had maturities of up to 270
days. In a series of transfers starting on October 26, 2001, and
concluding on November 6, 2001, Enron paid more than $1 billion to
various entities with respect to the CP prior to the stated
maturity date of the CP. Enron commenced litigation against Piper
Jaffray and DISH asserting claims for the avoidance and recovery
of allegedly preferential or constructive fraudulent transfers,
and seeking disallowance of claims filed by Piper and DISH claims.
Specifically, Enron sought to recover from Piper Jaffray
$52,288,282 and $41,542,480 from DISH in connection with the CP
Transfers. Following discussions among Enron, Piper and DISH, the
parties negotiated that Piper and DISH will pay Enron $6,200,522.
Piper and DISH will forfeit, waive and release any claim they have
against Enron.
Pursuant to the Court's order approving Enron Creditors Recovery
Corp.'s settlement with Piper Jaffray & Co., and Dish Network
Corporation, the parties executed a stipulation dismissing claims
by Enron against Piper and Dish Network with prejudice and with
each party to bear its own costs and attorney's fees.
Accordingly, Judge Gonzalez approved the parties' Stipulation.
About Enron
Based in Houston, Texas, Enron Corporation filed for chapter 11
protection on December 2, 2001 (Bankr. S.D. N.Y. Case No. 01-
16033)
following controversy over accounting procedures, which caused
Enron's stock price and credit rating to drop sharply.
Enron hired lawyers at Togut Segal & Segal LLP; Weil, Gotshal &
Manges LLP, Venable; Cadwalader, Wickersham & Taft, LLP for its
bankruptcy case. The Official Committee of Unsecured Creditors in
the case tapped lawyers at Milbank, Tweed, Hadley & McCloy LLP.
The Debtors filed their Chapter Plan and Disclosure Statement on
July 11, 2003. On January 9, 2004, they filed their fifth Amended
Plan and on the same day the Court approved the adequacy of the
Disclosure Statement. On July 15, 2004, the Court confirmed the
Debtors' Modified Fifth Amended Plan and that plan was declared
effective on November 17, 2004.
After the approval of the Plan, the new board of directors decided
to change the name of Enron Corp. to Enron Creditors Recovery
Corp. to reflect the current corporate purpose. ECRC's sole
mission is to reorganize and liquidate certain of the operations
and assets of the "pre-bankruptcy" Enron for the benefit of
creditors.
ECRC has been involved in the MegaClaims Litigation, an action
against 11 major banks and financial institutions that ECRC
believes contributed to Enron's collapse; the Commercial Paper
Litigation, an action involving the recovery of payments made to
commercial paper dealers; and the Equity Transactions Litigation,
which ECRC filed against Lehman Brothers Holdings, Inc., UBS AG,
Credit Suisse and Bear Stearns to recover payments made to the
four banks on transactions involving Enron's stock while the
company was insolvent.
(Enron Bankruptcy News; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
FLEETWOOD ENTERPRISES: Craig Little May Bid for Pendleton Property
------------------------------------------------------------------
Phil Wright at The East Oregonian reports that Arbutus RV & Marine
Sales owner Craig Little may present an offer for Fleetwood
Enterprises, Inc.'s Pendleton property, after failing to acquire
the Company's La Grande plant.
According to The East Oregonian, Mr. Little offered $1.8 million
for the La Grande plant, but he lost out to Ron Nash, owner of
Northwood Manufacturing, during a sale hearing and auction on
May 13. The report states that Mr. Nash offered $2.05 million for
the La Grande plant.
Mr. Little, The East Oregonian relates, said that Fleetwood
Enterprises has approached him about its Pendleton property and
that Tracy Bosen, local economic development director, has
discussed it with him as well. The East Oregonian quoted Mr.
Little as saying, "At the moment, we haven't got a bid in, let me
put it that way."
The East Oregonian states that Fleetwood Enterprises shut down its
trailer manufacturing division in March 2009, closing plants in La
Grande and Pendleton and laying off more than 400 workers, before
filing for bankruptcy.
Headquartered Riverside, California, Fleetwood Enterprises --
http://www.fleetwood.com/-- produces recreational vehicles and
manufactured homes. Fleetwood motor home products are distributed
through a nationwide network of approximately 150 dealers. The
Company and 19 of its affiliates filed for Chapter 11 protection
on March 10, 2009 (Bankr. C.D. Calif. Lead Case No. 09-14254).
Craig Millet, Esq., at Gibson, Dunn & Crutcher LLP, represents the
Debtors in their restructuring efforts. The Debtors proposed
Ernst & Young LLP as auditor, FTI Consulting Inc. as consultant,
and Greenhill & Co. LLC as financial advisor.
FLEETWOOD ENTERPRISES: Sells Trendsetter Housing to CMH for $4.5MM
------------------------------------------------------------------
Fleetwood Enterprises, Inc., has sold its Trendsetter military
housing assets to CMH Manufacturing, Inc., for $4.5 million in
cash following Bankruptcy Court approval of the sale yesterday.
CMH is a subsidiary of the Clayton Homes family of companies,
subsidiaries of Berkshire Hathaway. Trendsetter manufactures
modular barracks for the U.S. military in two adjacent facilities
located in Belton, Texas, south of Waco.
Under the terms of the purchase agreement, CMH will enter into new
contracts to complete current Trendsetter projects at Fort Sam
Houston and Fort Bliss, and for another building at Fort Sam
Houston. It is expected that CMH will make conditional job offers
to most of the unit's team members. Fleetwood's existing bonding
obligations on its military business, which Fleetwood backs with
letters of credit, will be significantly reduced as a result of
the transaction.
Headquartered Riverside, California, Fleetwood Enterprises --
http://www.fleetwood.com/-- produces recreational vehicles and
manufactured homes. Fleetwood motor home products are distributed
through a nationwide network of approximately 150 dealers. The
Company and 19 of its affiliates filed for Chapter 11 protection
on March 10, 2009 (Bankr. C.D. Calif. Lead Case No. 09-14254).
Craig Millet, Esq., at Gibson, Dunn & Crutcher LLP, represents the
Debtors in their restructuring efforts. The Debtors proposed
Ernst & Young LLP as auditor, FTI Consulting Inc. as consultant,
and Greenhill & Co. LLC as financial advisor.
FORD MOTOR: Finance Arm Sells $1.1 Billion in Five-Year Notes
-------------------------------------------------------------
Reuters reports that Ford Motor Co.'s finance arm, Ford Motor
Credit, sold on Thursday about $1.1 billion in five-year notes,
Reuters reports, citing a person familiar with the matter.
Gabrielle Coppola and John Detrixhe at Bloomberg News, citing a
person familiar with the matter, relate that the 8% notes are due
in 2014. According to Reuters, the notes were priced at 82.036 to
yield 13%, and the joint lead managers on the sale were JP Morgan,
Banc of America, Barclays, Deutsche Bank, and RBS.
According to Bloomberg, KDP Investment Advisors President Kingman
Penniman said that Ford is taking advantage of loosening credit
markets to boost its cash hoard as it grabs market share from U.S.
rivals Chrysler LLC and General Motors Corp.
Possible Financing to Visteon
Citing analysts, Jeff Bennett, Andrew Grossman, and Peg Brickley
at Dow Jones Newswires report that Ford may be forced to provide
the majority, if not all, of the financing Visteon Corp. will need
to reorganize and exit bankruptcy protection. Dow Jones notes
that the debtor-in-possession financing would intensify the
financial pressure on Ford. Barclays Capital analyst Brian
Johnson said that Visteon could need $500 million to $700 million
in DIP financing, based on the $510 million in cash the company
went through in the past 12 months, Dow Jones relates.
Dow Jones quoted Ford spokesperson Todd Nissen as saying, "What
we've committed to is to support the DIP financing for Visteon.
We would anticipate that others would also be involved going
forward."
According to Dow Jones, Brad Coulter of turnaround firm O'Keefe &
Associates said, "With the way the credit markets are, I'm not
sure anyone other than Ford or the federal government would
provide the money. We are not seeing anyone wanting to get into
the automotive space until everything shakes out. It's kind of
becoming Ford's problem."
About Ford
Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) --
http://www.ford.com/-- manufactures or distributes automobiles in
200 markets across six continents. With about 260,000 employees
and about 100 plants worldwide, the company's core and affiliated
automotive brands include Ford, Jaguar, Land Rover, Lincoln,
Mercury, Volvo, Aston Martin, and Mazda. The Company provides
financial services through Ford Motor Credit Company.
The Company has operations in Japan in the Asia Pacific region. In
Europe, the Company maintains a presence in Sweden, and the United
Kingdom. The Company also distributes its brands in various
Latin-American regions, including Argentina and Brazil.
* * *
As reported by the Troubled Company Reporter on April 15, 2009,
Standard & Poor's Ratings Services said it raised its ratings on
Ford Motor Co. and related entities, including the corporate
credit rating, to 'CCC+' from 'SD-'. The ratings on Ford Motor
Credit Co. are unchanged, at 'CCC+', and the ratings on FCE Bank
PLC, Ford Credit's European bank, are also unchanged, at 'B-',
maintaining the one-notch rating differential between FCE and its
parent Ford Credit. S&P said that the outlook on all entities is
negative.
Moody's Investors Service in December 2008 lowered the Corporate
Family Rating and Probability of Default Rating of Ford Motor
Company to Caa3 from Caa1 and lowered the company's Speculative
Grade Liquidity rating to SGL-4 from SGL-3. The outlook is
negative. The downgrade reflects the increased risk that Ford
will have to undertake some form of balance sheet restructuring to
achieve the same UAW concessions that General Motors and Chrysler
are likely to achieve as a result of the recently-approved
government bailout loans. Such a balance sheet restructuring
would likely entail a loss for bond holders and would be viewed by
Moody's as a distressed exchange and consequently treated as a
default for analytic purposes.
FRONTIER AIRLINES: Posts $248.2MM Net Loss in Year Ended March 31
-----------------------------------------------------------------
Frontier Airlines Holdings, Inc., and its debtor-affiliates filed
with the Securities and Exchange Commission on May 26, 2009, their
annual report for the fiscal year ended March 31, 2009.
During the year ended March 31, 2009, Frontier recorded net loss
of $248.2 million, which account for:
(i) $202.5 million in reorganization costs;
(ii) an increase in fuel expense for non-cash mark to market
derivative losses of $15.6 million and realized cash
payments of $2.6 million on fuel hedging contracts;
(iii) $8.6 million in net gains on sales of assets; and
(iv) $0.5 million in employee separation costs.
According to Sean E. Menke, president and chief executive officer
of Frontier Airlines, the Company's ability to continue as a
going concern is dependent upon, among other things, its ability
to:
* achieve required cost savings to complete restructuring;
* maintain adequate liquidity;
* generate cash from operations;
* confirm a plan of reorganization; and
* sustain profitability.
Mr. Menke reported that negative events associated with the
Debtors' Chapter 11 cases could adversely affect sales of tickets
and their relationship with customers, as well as with vendors
and employees, which in turn could adversely affect their
operations and financial condition, and create substantial doubt
about the Debtors' ability to continue as a going concern.
Employees and Unions
As of March 31, 2009, Frontier had approximately 5,283 Frontier
and Lynx Aviation employees, including 4,253 full-time and 1,030
part-time and on-call personnel. Approximately 20% of Frontier's
employees are represented by unions, according to Mr. Menke.
Six of Frontier's employee groups -- consisting of pilots,
dispatchers, mechanics, material specialists, aircraft appearance
agents, and the flight attendants at Frontier subsidiary, Lynx
Aviation, Inc. -- are represented by unions, including, among
others, the Association of Flight Attendants-CWA, Transport
Workers Union of America, the International Brotherhood of
Teamsters and FAPA.
Mr. Menke pointed out that if Frontier is unable to reach
agreements with any of the represented work groups when their
contracts open for renegotiation, or if non-represented employees
were to unionize and no agreements were reached regarding the
terms of their employment, the Debtors may need to go to
mediation. As a result, he continues, the Company may experience
widespread employee dissatisfaction, and could be subject to work
slowdowns or stoppages.
Moreover, Frontier may be subject to disruptions by organized
labor protesting certain groups for their non-union status or
conducting sympathy action for fellow members striking at other
airlines, Mr. Menke adds.
Aircraft Leases
As of March 31, 2009, Frontier operated 41 leased aircraft, which
are accounted for under operating lease agreements with initial
terms of 12-15 years. Security deposits related to leased
aircraft and future leased aircraft deliveries at March 31, 2009,
totaled $22.9 million.
Frontier is also required to make supplemental payments to cover
the cost of major scheduled maintenance overhauls of their
aircraft. The supplemental payments are based on the number of
flight hours flown and flight departures, and are included in
maintenance expense. Furthermore, the Lease Agreements require
the Company to pay taxes, maintenance, insurance, and other
operating expenses applicable to the leased property.
Additionally, to the extent actual maintenance expenses incurred
exceed these reserves, the Company is required to pay these
amounts. During the year ended March 31, 2009, supplemental
payments aggregated $27.1 million, Mr. Menke says.
Legal Proceedings
Mr. Menke noted that from time to time, Frontier is engaged in
routine litigation incidental to its business. As of the
Petition Date, all pending litigation relating to Frontier was
stayed.
Other than the Debtors' Chapter 11 proceeding, however, there are
no legal proceedings pending in which Frontier is a party -- or
of which any of the Company's property is the subject -- that are
not adequately covered by the Company's insurance, or will result
in a material adverse effect to Frontier's business, financial
condition, results of operations, or liquidity, Mr. Menke told
the SEC.
Performance Review for 2008
Mr. Menke reported these rankings that the Company gained based
on the Department of Transportation's statistics for 2008:
-- First in overall flight completion
-- Third among major carriers and fifth among reporting
carriers in on-time arrivals
-- Third among major carriers and fifth among all carriers in
fewest customer complaints
-- Fifth among major carriers and eighth among reporting
carriers in lowest mishandled bag radio
Frontier was one of only two recognized major carriers to rank in
the top five in all four major DOT reporting categories according
to the DOT's year-end "Air Travel Consumer Report," Mr. Menke
disclosed.
The number of shares of the Company's common stock outstanding as
of May 22, 2009, is 36,945,744. As of March 31, 2009, there were
1,747 holders of record of Frontier's common stock.
A full-text copy of Frontier's 2008 Full Year Results is available
for free at http://ResearchArchives.com/t/s?3d52
FRONTIER AIRLINES HOLDINGS, INC., ET AL.
Consolidated Balance Sheets
As of March 31, 2009
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $71,793,000
Investment securities -
Restricted cash and investments 134,359,000
Receivables, net 40,469,000
Prepaid expenses and other assets 20,233,000
Inventories, net 12,464,000
Assets held for sale 704,000
---------------
Total current assets 280,022,000
Property and other equipment, net 610,434,000
Security and other deposits 25,420,000
Aircraft pre-delivery payments 6,466,000
Restricted cash and investments 2,987,000
Deferred loan fees and other assets 4,270,000
---------------
Total Assets $929,599,000
===============
LIABILITIES AND STOCKHOLDERS' DEFICIT
Liabilities not subject to compromise:
CURRENT LIABILITIES:
Accounts payable $44,890,000
Air traffic liability 145,156,000
Other accrued expenses 54,227,000
Current portion of long-term debt -
Short-term borrowings 3,000,000
DIP loan 30,000,000
Deferred revenue and other liabilities 15,759,000
---------------
Total current liabilities 293,032,000
Long-term debt related to aircraft notes -
Convertible notes -
Deferred revenue and other liabilities 18,833,000
Other note payable 3,000,000
---------------
Total Liabilities not subject to compromise 314,865,000
Liabilities subject to compromise 708,661,000
---------------
Total Liabilities 1,023,526,000
Commitments and contingencies:
STOCKHOLDERS' EQUITY:
Preferred stock -
Common stock 37,000
Additional paid-in capital 197,102,000
Unearned ESOP shares -
Accumulated other comprehensive loss, net -
Retained deficit (291,066,000)
---------------
Total Stockholders' Equity (93,927,000)
---------------
Total Liabilities and Stockholders' Equity $929,599,000
===============
FRONTIER AIRLINES HOLDINGS, INC., ET AL.
Consolidated Statement of Operations
Year Ended March 31, 2009
Revenues:
Passenger $1,225,870,000
Cargo 6,070,000
Other 57,442,000
---------------
Total revenues 1,289,382,000
Operating expenses:
Flight operations 165,137,000
Aircraft fuel 531,060,000
Aircraft lease 115,650,000
Aircraft and traffic servicing 182,255,000
Maintenance 95,273,000
Promotion and sales 100,864,000
General and administrative 56,470,000
Operating expense -- regional partners 26,650,000
Post-retirement liability curtailment gain -
Employee separation and exit costs 466,000
Loss on sales of assets, net (8,598,000)
Depreciation 41,041,000
---------------
Total operating expenses 1,306,268,000
---------------
Business interruption insurance proceeds -
---------------
Operating loss (16,886,000)
Non-operating income (expense):
Interest income 4,081,000
Interest expense (29,327,000)
Loss from early extinguishment of debt (990,000)
Other, net (753,000)
---------------
Total non-operating expense, net (26,989,000)
Loss before reorganization items and taxes (43,875,000)
Reorganization expenses 202,495,000
---------------
Loss before income taxes (246,370,000)
Income tax expense (benefit) 1,819,000
---------------
Net Loss ($248,189,000)
===============
FRONTIER AIRLINES HOLDINGS, INC., ET AL.
Consolidated Statement of Cash Flows
Year Ended March 31, 2009
Cash flows from operating activities:
Net Loss ($248,189,000)
Adjustments to reconcile net loss to net cash
and cash equivalents provided by
operating activities:
Compensation expense 1,844,000
Depreciation and amortization 43,818,000
Provisions recorded on inventories 1,442,000
Loss (gains) on sales of assets, net (8,598,000)
Total increase in fuel expense 18,181,000
Proceeds paid for settlements (2,606,000)
Post-retirement liability curtailment gain -
Loss on early extinguishment of debt 990,000
Deferred income taxes -
Reorganization items 202,495,000
Changes in operating assets and liabilities:
Restricted cash and investments (60,382,000)
Receivables 14,300,000
Prepaid expenses and other assets 6,195,000
Inventories 4,943,000
Other assets (650,000)
Accounts payable 18,153,000
Air traffic liability (80,861,000)
Other accrued expenses (25,725,000)
Deferred revenue and other liabilities (7,996,000)
---------------
Net cash used by operating activities
before reorganization (122,646,000)
Cash flows from reorganization activities:
Net cash used by reorganization activities (12,383,000)
---------------
Total net cash used in operating activities (135,029,000)
Cash flows from investing activities:
Aircraft lease and purchase deposits made (6,402,000)
Aircraft lease and purchase deposits returned 11,512,000
Purchase of available-for-sale securities -
Sale of available-for-sale securities 8,800,000
Proceeds from sale of property and equipment 59,645,000
Proceeds from sale-leaseback transactions -
Capital expenditures (18,565,000)
Proceeds from sales of aircraft
-- reorganization 194,300,000
---------------
Net cash provided by investing activities 249,290,000
Cash flows from financing activities:
Net proceeds from issuance of common stock -
Proceeds from DIP loan 30,000,000
Purchase of treasury shares -
Payment to bank for compensating balance -
Proceeds form long-term borrowings -
Payments received on note receivable -
Extinguishment of long-term borrowings (33,754,000)
Principal payments on long-term borrowings (34,454,000)
Principal payments on short-term borrowings (3,139,000)
Payment of financing fees (2,175,000)
Extinguishment of long-term borrowings
-- reorganization item (119,783,000)
---------------
Net cash used in financing activities (163,305,000)
Net decrease in cash and cash equivalents (49,044,000)
Cash and cash equivalents at beginning of year 120,837,000
---------------
Cash and cash equivalents at end of year $71,793,000
===============
About Frontier Airlines
Headquartered in Denver, Colorado, Frontier Airlines Inc. --
http://www.frontierairlines.com/-- provides air transportation
for passengers and freight. It operates jet service carriers
linking Denver, Colorado hub to 46 cities coast-to-coast, 8 cities
in Mexico, and 1 city in Canada, as well as provide service from
other non-hub cities, including service from 10 non-hub cities to
Mexico.
Frontier Airlines and its debtor-affiliates filed for Chapter 11
protection on April 10, 2008, (Bankr. S.D. N.Y. Case No.
08-11297 thru 08-11299.) Benjamin S. Kaminetzky, Esq., and Hugh
R. McCullough, Esq., at Davis Polk & Wardwell, represent the
Debtors in their restructuring efforts. Togul, Segal & Segal
LLP is the Debtors' Conflicts Counsel, Faegre & Benson LLP is
the Debtors' Special Counsel, and Kekst and Company is the
Debtors' Communications Advisors.
The Debtors' exclusive period to file a plan of reorganization
will expire on October 9, 2009. Their exclusive period to solicit
and obtain acceptances of that plan will expire December 9, 2009.
Bankruptcy Creditors' Service, Inc., publishes Frontier Airlines
Bankruptcy News. The newsletter tracks the Chapter 11 proceedings
of Frontier Airlines Inc. and its debtor-affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
FRONTIER AIRLINES: Wants to End Employee Stock Ownership Plan
-------------------------------------------------------------
Frontier Airlines Holdings, Inc., and its debtor-affiliates
maintain an Employee Stock Ownership Plan, which is a qualified
plan under Sections 401(a) and 4975(e)(7) of the Internal Revenue
Code. Prior to their bankruptcy filing, the Debtors made
discretionary contributions of Frontier Airlines' common stock for
the benefit of their eligible employees.
The Debtors' annual contributions to the Plan, if any, are to be
allocated among the Participants at the end of each plan year, in
proportion to the relative compensation earned by each of the
Participants during that plan year. Damian S. Schaible, Esq., at
Davis Polk & Wardwell, in New York, relates that as of the end of
the last Plan Year, October 31, 2008, the Plan covered
approximately 4,396 active Participants, which was substantially
all of the Debtors' employees, other than those covered by a
collective bargaining agreement that did not provide for
participation in the Plan. Since the Plan's inception, the
Debtors have contributed a total of 3,187,000 shares of Stock to
the Plan, including 300,000 shares contributed in March 2008.
Since October 31, 2008, the Stock has traded in over-the-counter
markets in the range of $0.18 to $0.45 per share, Mr. Schaible
says. The Debtors have not made further contributions to the Plan
since the Petition Date, with the Stock contained in the Plan
expected to be cancelled upon the Debtors' emergence from Chapter
11. However, so long as the Plan remains in existence, the Debtors
are still required to undertake time-consuming responsibilities
with respect to the Plan, which cost the Debtors' estates
approximately $250,000 per year.
Mr. Huebner specifies that the Ministerial Requirements for
administering the Plan include:
-- directing the Trustee with respect to voting shares of
Stock to the extent that Participants do not so direct the
voting as provided for in the Plan;
-- valuing the Stock annually in accordance with Employee
Retirement Income Security Act of 1974;
-- keeping accurate books and records with respect to the
Participants, their share allocations and Compensation;
-- periodically reviewing the performance of the Plan agents,
fiduciaries and managers; and
-- overseeing and delegating other responsibilities as may be
necessary and appropriate in the ordinary course of
administering the Plan.
By terminating the Plan, the Debtors will eliminate the ongoing
time commitments and costs required to maintain it. In addition,
given the current and expected value of the Stock, the Debtors
cannot justify the continued expenditures, Mr. Huebner tells
Judge Robert D. Drain of the U.S. Bankruptcy Court for the
Southern District New York. Moreover, given the likely treatment
of the Stock under any plan of reorganization, the Debtors believe
that distributing the Stock to Participants at this time benefits
the Participants.
Accordingly, the Debtors seek the Court's authority to perform
under their Second Amended Employee Stock Ownership Plan dated as
of April 2, 2009, pursuant to which the Debtors will:
(1) terminate the Plan, effective as of October 31, 2008; and
(2) effectuate a distribution by the Plan's trustee to each
affected eligible employee of the Stock contained in each
of their accounts.
About Frontier Airlines
Headquartered in Denver, Colorado, Frontier Airlines Inc. --
http://www.frontierairlines.com/-- provides air transportation
for passengers and freight. It operates jet service carriers
linking Denver, Colorado hub to 46 cities coast-to-coast, 8 cities
in Mexico, and 1 city in Canada, as well as provide service from
other non-hub cities, including service from 10 non-hub cities to
Mexico.
Frontier Airlines and its debtor-affiliates filed for Chapter 11
protection on April 10, 2008, (Bankr. S.D. N.Y. Case No.
08-11297 thru 08-11299.) Benjamin S. Kaminetzky, Esq., and Hugh
R. McCullough, Esq., at Davis Polk & Wardwell, represent the
Debtors in their restructuring efforts. Togul, Segal & Segal
LLP is the Debtors' Conflicts Counsel, Faegre & Benson LLP is
the Debtors' Special Counsel, and Kekst and Company is the
Debtors' Communications Advisors.
The Debtors' exclusive period to file a plan of reorganization
will expire on October 9, 2009. Their exclusive period to solicit
and obtain acceptances of that plan will expire December 9, 2009.
Bankruptcy Creditors' Service, Inc., publishes Frontier Airlines
Bankruptcy News. The newsletter tracks the Chapter 11 proceedings
of Frontier Airlines Inc. and its debtor-affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
FRONTIER AIRLINES: Can Perform Under Amended WestLB Agreements
--------------------------------------------------------------
Judge Robert D. Drain of the U.S. Bankruptcy Court for the
Southern District New York authorized Frontier Airlines Holdings,
Inc., and its debtor-affiliates to perform under these amended
agreements with WestLB AG, New York Branch:
(a) Amendment No. 4 to the WestLB Facility or Credit Agreement
dated as of March 21, 2005;
(b) Amendment No. 1 to the Spare Parts Mortgage and Security
Agreement dated as of March 21, 2005; and
(c) Amendment No. 1 to the Amended and Restated Secured
Superpriority Debtor-in-Possession Credit Agreement dated
as of April 1, 2009, between and among the Debtors, the
lenders party and Wells Fargo Bank Northwest, National
Association, as administrative agent.
Full text copies of the Amended Agreements are available for free
at:
* http://bankrupt.com/misc/FAH_AmendmentNo4WestLBFacility.pdf
* http://bankrupt.com/misc/FAH_AmendmentNo1MortgagePact.pdf
* http://bankrupt.com/misc/FAH_AmendmentNo1CreditPact.pdf
According to the Troubled Company Reporter on May 26, 2009, Damian
S. Schaible, Esq., at Davis Polk & Wardwell, in New York, related
that pursuant to the WestLB Facility, WestLB has issued letters of
credit on the Debtors' behalf that are required in the ordinary
course of the Debtors' businesses. There is presently $12,053,579
worth of L/Cs outstanding under the WestLB Facility, which are
principally issued to state and local governmental authorities as
part of airport lease agreements and workers' compensation
insurance underwriters. Pursuant to the WestLB Mortgage,
substantially all of the Debtors' spare aircraft and engine parts
serve as collateral for the WestLB Facility. According to Mr.
Schaible, the WestLB Facility matures on July 31, 2009, prior to
which, the Debtors must replace each of the L/Cs outstanding. Two
of the outstanding L/Cs are scheduled to be renewed even prior to
the Maturity Date, consisting of:
(1) an L/C in the face amount of $4,500,000 issued to AIG
Aviation, Inc.; and
(2) an L/C in the face amount of $1,500,000 issued to ACE
American Insurance Company.
The TCR reported that at the Debtors' request, WestLB has agreed
to renew these letters of credit in order to provide the Debtors
sufficient time to replace them in the ordinary course. Since
WestLB's exposure under the Remaining Letters of Credit will be
significantly smaller than it was under all of the L/Cs previously
issued under the WestLB Facility, the Debtors and WestLB will
amend the WestLB Mortgage to release WestLB's lien on a portion of
the Spare Parts.
The Court clarified that the Amendments will not constitute (i) an
assumption by the Debtors of the WestLB Facility or the WestLB
Mortgage, (ii) an agreement to assume the WestLB Facility or the
WestLB Mortgage, or (iii) a postpetition reaffirmation of the
WestLB Facility or the WestLB Mortgage.
The Debtors certified that there were no objections filed to their
request.
About Frontier Airlines
Headquartered in Denver, Colorado, Frontier Airlines Inc. --
http://www.frontierairlines.com/-- provides air transportation
for passengers and freight. It operates jet service carriers
linking Denver, Colorado hub to 46 cities coast-to-coast, 8 cities
in Mexico, and 1 city in Canada, as well as provide service from
other non-hub cities, including service from 10 non-hub cities to
Mexico.
Frontier Airlines and its debtor-affiliates filed for Chapter 11
protection on April 10, 2008, (Bankr. S.D. N.Y. Case No.
08-11297 thru 08-11299.) Benjamin S. Kaminetzky, Esq., and Hugh
R. McCullough, Esq., at Davis Polk & Wardwell, represent the
Debtors in their restructuring efforts. Togul, Segal & Segal
LLP is the Debtors' Conflicts Counsel, Faegre & Benson LLP is
the Debtors' Special Counsel, and Kekst and Company is the
Debtors' Communications Advisors.
The Debtors' exclusive period to file a plan of reorganization
will expire on October 9, 2009. Their exclusive period to solicit
and obtain acceptances of that plan will expire December 9, 2009.
Bankruptcy Creditors' Service, Inc., publishes Frontier Airlines
Bankruptcy News. The newsletter tracks the Chapter 11 proceedings
of Frontier Airlines Inc. and its debtor-affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
FRONTIER AIRLINES: Addresses U.S. Trustee's Objections to Fees
--------------------------------------------------------------
As previously reported by the Troubled Company Reporter, Diana G.
Adams, United States Trustee for Region 2, asked Judge Robert D.
Drain of the U.S. Bankruptcy Court for the Southern District New
York to reduce any fees paid and expenses reimbursed to
professionals by a percent reduction pending the final resolution
of Frontier Airlines Holdings, Inc., and its debtor-affiliates'
Chapter 11 cases. She noted that the results that will be
achieved serve as an important factor in determining the success
of the efforts of the Applicants.
In response, the Debtors contend that the their substantial
accomplishments during the interim fee period from December 1,
2008, through March 31, 2009, have been due in no small part to
the ongoing assistance of the Applicants. Marshall S. Huebner,
Esq., at Davis Polk & Wardwell, in New York, points out that the
Applicants have played an instrumental role in helping the Debtors
to, among other things:
(a) negotiate and structure a critically-needed amendment and
extension to their debtor-in-possession credit facility;
(b) rationalize their fleet and reduce their debt obligations;
(c) obtain Court authorization for the rejection of numerous
executory contracts and successfully object to or settle
numerous and substantial claims;
(d) find, secure, negotiate and enter into new or amended
business relationships with various vendors, service
providers and utilities;
(e) successfully litigate or consensually resolve various
labor issues; and
(f) resolve scores of matters consensually in order to
minimize expense to the estates.
Nine professionals in the Debtors' Chapter 11 cases asked Judge
Drain to approve payment of their fees and reimbursement of their
expenses for services they rendered to the Debtors or the
Official Committee of Unsecured Creditors for the period from
December 1, 2008 through March 31, 2008:
Professional Fees Expenses
------------ ---- --------
Davis Polk & Wardwell $1,926,312 $44,221
Deloitte Tax LLP 223,471 4,557
Faegre & Benson LLP 27,450 442
Houlihan Lokey Howard 600,000 9,542
& Zukin Capital, Inc.
Jefferson Wells 354,077 5,233
International, Inc.
KPMG LLP 186,406 2,761
Seabury Transportation 1,775,116 57,426
Holdings LLC
Togut, Segal & Segal LLP 20,486 267
Wilmer Cutler Pickering 170,721 4,722
Hale and Dorr LLP
"Given the size and complexity of the Debtors' cases, and in
light of the economic downturn and unfavorable credit market
conditions, the Debtors' achievements, with the help and support
of the Applicants, have been remarkable," Mr. Huebner avers. Mr.
Huebner further relates that the Debtors' successes during the
Interim Fee Period have been achieved on a largely consensual
basis. Notably, the Official Committee of Unsecured Creditors
has worked with other parties to reach consensual resolutions of
potential disputes. With the exception of certain proceedings
relating to one of the Debtors' unionized groups, there have been
virtually no contested matters in the Chapter 11 cases, Mr.
Huebner tells the Court. Mr. Huebner further affirms that while
the U.S. Trustee sought to impose a further "holdback" because the
ultimate results of the Debtors' cases are not yet known, the
results of the Interim Fee Period are "extremely positive."
Against this backdrop, the Debtors, along with the Creditors'
Committee, ask the Court to authorize payment of the Fee
Applications in full.
About Frontier Airlines
Headquartered in Denver, Colorado, Frontier Airlines Inc. --
http://www.frontierairlines.com/-- provides air transportation
for passengers and freight. It operates jet service carriers
linking Denver, Colorado hub to 46 cities coast-to-coast, 8 cities
in Mexico, and 1 city in Canada, as well as provide service from
other non-hub cities, including service from 10 non-hub cities to
Mexico.
Frontier Airlines and its debtor-affiliates filed for Chapter 11
protection on April 10, 2008, (Bankr. S.D. N.Y. Case No.
08-11297 thru 08-11299.) Benjamin S. Kaminetzky, Esq., and Hugh
R. McCullough, Esq., at Davis Polk & Wardwell, represent the
Debtors in their restructuring efforts. Togul, Segal & Segal
LLP is the Debtors' Conflicts Counsel, Faegre & Benson LLP is
the Debtors' Special Counsel, and Kekst and Company is the
Debtors' Communications Advisors.
The Debtors' exclusive period to file a plan of reorganization
will expire on October 9, 2009. Their exclusive period to solicit
and obtain acceptances of that plan will expire December 9, 2009.
Bankruptcy Creditors' Service, Inc., publishes Frontier Airlines
Bankruptcy News. The newsletter tracks the Chapter 11 proceedings
of Frontier Airlines Inc. and its debtor-affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
FURNITURE-IN-PARTS: Files for Chapter 11 Bankruptcy Protection
--------------------------------------------------------------
Furniture-In-Parts Corporation, dba The Door Store, has filed for
Chapter 11 bankrutpcy protection in the U.S. Bankruptcy Court for
the Southern District of New York, Furniture Today reports.
According to Furniture Today, Furniture-In-Parts President and COO
blamed the Company's financial difficulties on "the general
economic climate resulting in weakening sales, unprofitable lease
locations, litigation with landlords, and diminishing operating
funds."
Court documents say that Furniture-In-Parts listed $2,633,438 in
assets and $2,230,066 in debts. According to court documents,
Furniture-In-Parts named at least 11 furniture suppliers in its
Top 20 unsecured creditors with claims totaling almost $600,000.
Secaucus, New Jersey-based Furniture-In-Parts Corporation, dba The
Door Store, is a family owned business established in New York in
1955. It has nine stores in New York and New Jersey.
GENERAL MOTORS: Filing Chapter 11 Petitions Today
-------------------------------------------------
General Motors Corporation, the world's second-largest automaker,
intends to file Chapter 11 petitions by 8 a.m. today in Manhattan.
The Chapter 11 proceeding proposes to quickly sell substantially
all of General Motors' profitable assets under 11 U.S.C. Sec. 363
to a newly formed entity, the equity of which will be split:
-- 72.5% by the U.S. Treasury and the Canadian government;
-- 17.5% by the United Auto Workers; and
-- 10.0% by the unsecured bondholders owed $27 billion,
together with the right to increase that stake.
To date, the U.S. and Canadian governments have extended more than
$19 billion in financing to General Motors. The governments are
reportedly committing up to $30 billion of new financing.
Under the Treasury's Sec. 363 Proposal, New GM would be expected
to have this additional capitalization:
-- $17 billion in debt, including:
* $8.0 billion of debt owed to U.S. Treasury2
* $2.5 billion of debt owed to new Voluntary Employee
Beneficiary Association (?New VEBA?)
* $6.5 billion of other debt
-- Perpetual preferred stock:
* $9.0 billion cumulative perpetual preferred stock with a
9% dividend per annum
* $2.5 billion issued to the U.S. Treasury
* $6.5 billion issued to New VEBA
General Motors is represented by Harvey R. Miller, Esq., at Weil,
Gotshal & Manges LLP and will be assisted by scores of additional
lawyers from that firm. Weil Gotshal represents Lehman Brothers
and General Growth Properties Inc., among many other high-profile
debtors. Al Koch at AlixPartners LLC will serve as chief
restructuring officer for GM. Mr. Koch previously served in
executive positions at Kmart Corp., Handleman Co., Champion
Enterprises Inc., Oxford Health Plans Inc., and other companies.
An ad hoc group of noteholders intimately involved in negotiations
with the U.S. Treasury Department is represented by Eric Siegert
at Houlihan Lokey Howard & Zukin, as financial advisors, and
Andrew Rosenberg, Esq., at Paul, Weiss, Rifkind, Wharton &
Garrison, as legal counsel.
General Motors President and CEO Fritz Henderson plans to host a
press conference, beginning immediately following President
Obama's media briefing. According to a White House media
advisory, President Obama will begin his remarks at approximately
11:55 a.m. Eastern Time. Mr. Henderson will address media
separately from New York following the President, beginning at
12:15 p.m., Eastern Time.
As of March 31, 2009, GM had $82.2 billion in total assets and
$172.8 billion in total liabilities, resulting in $90.5 billion in
stockholders' deficit.
Debt Swap
Sharon Terlep and Kevin Helliker at The Wall Street Journal report
that majority of investors holding $27 billion in General Motors
Corp.'s bonds agreed to forgive the debt for equity in the new
company. WSJ relates that an ad hoc committee representing major
bondholders agreed to support the offer and encouraged other big
investors to back the deal. Citing a spokesperson for the
bondholder committee, WSJ states that 54% of the bondholders have
indicated their support and that 975 institutions either sent
support letters or gave indications of support.
WSJ says that bondholders represented by Thomas Lauria, who is
also a lawyer for holdouts in the Chrysler LLC case, fought
against the deal. Small, individual bondholders were left with no
voice as the Treasury negotiated directly with GM's large
institutional holders, the report states, citing Mr. Lauria.
WSJ notes that GM initially said that getting bondholders to agree
to a debt swap was its best chance for avoiding Chapter 11. The
Company's latest plan, according to WSJ, is designed to speed up a
bankruptcy filing more than to avoid it. WSJ relates that as part
of the agreement, bondholders pledged not to oppose GM's
reorganization in court.
GM said that the U.S. Department of the Treasury has informed the
Company that the support of more than 54% of the bondholders
allows GM to proceed with the 363 Sale Proposal.
Conflicts May Arise From Gov't Participation
Neil King Jr., Jeffrey McCracken, and Mike Spector at WSJ relate
the federal government is likely within weeks to emerge as the
principal owner of GM, and will simultaneously serve as the
Company's regulator, tax collector, customer, pension backstop,
and lender. According to WSJ, the government will release a set
of principles today to guide its interactions with GM in the
coming months and years, as well as other companies, like Chrysler
LLC, GMAC, and various banks.
WSJ notes that, given the size of the $50 billion U.S. investment,
it will be hard for President Barack Obama and Congress to say
they will remain uninvolved in GM. WSJ states that members of
Congress forced GM to take back a decision to ship some jobs to
China. WSJ relates that the administration has also said that it
wants to direct GM to make more fuel-efficient small cars, a
potential threat to the Company's near-term profitability.
According to WSJ, GM is one of the biggest sellers of full-size
trucks and sport-utility vehicles in the world -- vehicles that
are notorious for fuel inefficiency -- and will continue to be
even after bankruptcy. Those products, WSJ says, have always been
among the Company's most profitable.
"While not running an auto company on a day-to-day basis,
obviously there will be concern about investments by the taxpayer,
as there should be," WSJ quoted White House spokesperson Robert
Gibbs as saying.
Justin Lahart at WSJ notes that the GM bankruptcy may lift the
economy in the long term. Citing ITG economist Robert Barbera,
WSJ relates that GM and Chrysler have for a long time sapped
capital that could have been used elsewhere. WSJ states that if
GM's bankruptcy goes as smoothly as the government hopes, a leaner
company will emerge within a few months and over time, workers and
other resources would move to more productive areas of the
economy.
WSJ says that the estimated losses in quick, concise bankruptcy
restructurings at Chrysler and GM are 63,200 jobs in 2009, with
further job losses of 179,400 in 2010. According to WSJ, Center
for Automotive Research researcher Debra Menk said, "It's still an
impact, but a more tolerable impact," said Center for Automotive
Research researcher Debra Menk.
UAW Skeptic on Exercising GM Stock Warrants
John D. Stoll and Matthew Dolan at The Wall Street Journal
reported that United Auto Workers President Ron Gettelfinger was
doubtful of the union's ability to exercise the additional 2.5% in
stock warrants it has been offered under a GM bankruptcy plan.
According to WSJ, Mr. Gettelfinger said, "$75 billion in equity
for the Company . . . we didn't put a whole lot of emphasis on the
2.5% warrants, let me put it that way.... On the equity warrants,
with the Company's equity value being at $75 billion, we sort of
(said) that's over there in the corner somewhere.' We're basing
everything else on reality."
GM confirmed that its UAW-represented employees have ratified the
modifications to the GM-UAW 2007 National Labor Agreement. The
amended agreement covers approximately 54,000 hourly employees
located in 46 U.S. facilities. "The leadership demonstrated by
UAW president Ron Gettelfinger and UAW vice president Cal Rapson,
and the hard work from the members of the GM and UAW negotiating
teams, resulted in an innovative agreement that will enable GM to
be fully competitive and has eliminated the gap with our
competitors," said Diana Tremblay, vice president of GM's Labor
Relations. "We very much appreciate the support of our employees
and retirees. Their shared sacrifices will enable GM to become a
stronger, more viable company that will continue to deliver world-
class cars and trucks."
WSJ states that in exchange for approving a deal altering a trust
set up for retiree health care, and agreeing to take a significant
cut in future funding for the trust, the UAW is guaranteed to get:
-- a 17.5% stake in the new GM,
-- $6.5 billion in preferred stock that pays a 9% annual
dividend,
-- a $2.5 billion note, and
-- $9.5 billion in cash that had been set aside in 2008 for
the fund.
Key highlights under the modified agreement include attainment of
cost and cash savings comprehended in the GM Viability Plan that
will enable the Company to eliminate the wage and benefit gap with
its competitors. It also includes changes to the agreements
regarding the Voluntary Employee Beneficiary Association (VEBA)
trust for retiree healthcare. The agreement also highlights GM's
plan to utilize an idled assembly and stamping facility for future
production of a compact/small car in the U.S. to meet future fuel
efficiency regulations.
"I would like to personally thank the UAW for agreeing to work
with us to ensure our overall manufacturing competitiveness in the
United States," said Fritz Henderson, General Motors President and
CEO.
GM will build a future small car in the U.S., utilizing an idled
UAW-GM facility. This vehicle adds to GM's growing portfolio of
U.S.-built, highly fuel efficient cars including the Chevrolet
Cruze and Volt. Mr. Henderson said, "Small cars represent one of
the fastest growing segments in both the U.S. and around the
world. We believe this car will be a winner with our current and
future customers in the U.S. This vehicle segment, while
important today and expected to be more so in the future, is
extremely challenging. It takes a special effort by everyone to
bring a domestically produced small car to market in a cost-
competitive and profitable way -- but that is what we are going to
do together."
The re-tooled plant will be capable of building 160,000 cars
annually, which can be a combination of both small and compact
vehicles. Selection of the site will be determined in the future.
Hummer Brand Nears Sale
GM is closing in on the sale of its Hummer brand with an
undisclosed investor, John D. Stoll, Stefania Bianchi, and Sharon
Terlep at WSJ report, citing people familiar with the matter. The
sources, according to WSJ, said that the deal would preserve about
3,000 jobs in manufacturing, engineering, and at dealerships.
WSJ quoted a GM spokesperson as saying, the Company is "working
through the final details of an agreement." The sources said that
GM hopes to close the deal -- which could include a condition for
the new investor to acquire a manufacturing plant in Louisiana
that builds Hummer models -- by the end of September, WSJ relates.
According to the report, sources said that the buyer has committed
to make aggressive investment in future Hummer products.
Citing people familiar with the matter, WSJ relates that recent
offers for the Hummer brand were in the $200 million range.
Magna Partners With Opel
Marcus Walker, Andrew Grossman, and Gregory L. White at WSJ report
that the German government chose Magna International Inc. as a
partner for Adam Opel. Dow Jones relates that the new company
will take charge of GM's European operations.
Citing German Finance Minister Peer Steinbrueck, WSJ says that the
government agreed to provide EUR1.5 billion, or $2.09 billion in
interim loans while Magna International and GM finalize the
contract. According to the report, the minister said that the
parties involved also agreed on a trusteeship for Opel to isolate
the European operations from GM's expected bankruptcy proceedings.
Dow Jones Newswires relates said that Business Secretary Peter
Mandelson said that the UK government is also seeking an early
meeting with Magna International over the future of UK General
Motors unit Vauxhall. Mr. Mandelson said in a statement, "Now I
will be seeking a very early, further meeting with them to
reinforce that commitment and to make it into a cast-iron
guarantee, and I'll be concentrating on that as soon as these
initial talks have been completed between them and General Motors
USA."
Dow Jones quoted Mr. Mandelson as saying, "We are at the beginning
of a process of due diligence, of examination by Magna and their
partner, the Russian Savings Bank, of the finances of General
Motors in Europe as a whole. Over the coming weeks and months, we
will be talking to them about their detailed plans and how those
will affect Vauxhall here in the UK.... We accept that the new
company going forward will need government help from a range of
European governments. We have accepted that we will play our fair
share in that. But just how much will depend on the needs, the
requests of the new owners, and what they're prepared to put or
keep in production and employment here in the UK."
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.
As reported by the Troubled Company Reporter, GM reported net loss
of $6.0 billion, including special items, in the first quarter of
2009. This compares with a reported net loss of $3.3 billion in
the year-ago quarter. Excluding special items, the Company
reported an adjusted net loss of $5.9 billion in the first quarter
of 2009 compared to an adjusted net loss of $381 million in the
first quarter of 2008. As of March 31, 2009, GM had $82.2 billion
in total assets and $$172.8 billion in total liabilities,
resulting in $90.5 billion in stockholders' deficit.
On April 27, General Motors presented the U.S. Department of
Treasury with an updated plan as required by the loan agreement
signed by GM and the U.S. Treasury on December 31, 2008. The plan
addresses the key restructuring targets required by the loan
agreement, including a number of the critical elements of the plan
that was submitted to the U.S. government on December 2, 2008.
Among these are: U.S. market competitiveness; fuel economy and
emissions; competitive labor cost; and restructuring of the
company's unsecured debt. It also includes a timeline for
repayment of the Federal loans, and an analysis of the Company's
positive net present value.
The plan details the future reduction of GM's vehicle brands and
nameplates in the U.S., further consolidation in its workforce and
dealer network, accelerated capacity actions and enhanced
manufacturing competitiveness, while maintaining GM's strong
commitment to high-quality, fuel-efficient vehicles and advanced
propulsion technologies.
GM also launched a bond exchange offer for roughly $27 billion of
unsecured public debt. If successful, the bond exchange would
result in the conversion of a large majority of this debt to
equity.
GM is also in talks with the UAW to modify the terms of the
Voluntary Employee Benefit Association, and with the U.S. Treasury
regarding possible conversion of its debt to equity. The current
bond exchange offer is conditioned on the converting to equity of
at least 50% of GM's outstanding U.S. Treasury debt at June 1,
2009, and at least 50% of GM's future financial obligations to the
new VEBA. GM expects a debt reduction of at least $20 billion
between the two actions.
In total, the U.S. Treasury debt conversion, VEBA modification and
bond exchange could result in at least $44 billion in debt
reduction.
GM filed with the Securities and Exchange Commission a
registration statement related to its exchange offer. The filing
incorporates the revised Viability Plan. A full-text copy of the
filing is available at http://ResearchArchives.com/t/s?3c09
A full-text copy of GM's viability plan presented in February 2009
is available at http://researcharchives.com/t/s?39a4
Going Concern Doubt
Deloitte & Touche LLP, has said there is substantial doubt about
GM's ability to continue as a going concern after reviewing GM's
2008 financial report. Deloitte cited the Company's recurring
losses from operations, stockholders' deficit and failure to
generate sufficient cash flow to meet the Company's obligations
and sustain the its operations. It said GM's future is dependent
on the Company's ability to execute the Company's Viability Plan
successfully or otherwise address these matters. If the Company
fails to do so for any reason, the Company would not be able to
continue as a going concern and could potentially be forced to
seek relief through a filing under the U.S. Bankruptcy Code.
Standard & Poor's Ratings Services on April 10 lowered its issue-
level rating on GM's $4.5 billion senior secured revolving credit
facility to 'CCC-' (one notch above the 'CC' corporate credit
rating on the company) from 'CCC'. It revised the recovery rating
on this facility to '2' from '1', indicating its view that lenders
can expect substantial (70% to 90%) recovery in the event of a
payment default. The corporate credit rating remains unchanged,
at 'CC', reflecting its view of the likelihood that GM will
default -- through either a bankruptcy or a distressed debt
exchange.
Moody's Investors Service said February 18 that the risk of a
bankruptcy filing by GM and Chrysler remains high. The last
rating action on GM and Chrysler was a downgrade of their
Corporate Family Ratings to Ca on December 3, 2008.
GENERAL MOTORS: Will Identify 14 Plants to be Shut Down
-------------------------------------------------------
General Motors Corp. will disclose 14 factories that it will shut
down by the end of 2010, along with its bankruptcy filing, The
Associated Press reports, citing a source.
The AP states that factories to be closed include four vehicle
assembly plants and parts stamping, engine, and transmission
factories. Citing HIS Global Insight auto industry analyst Haig
Stoddard, Kelsey Volkmann at St. Louis Business Journal relates
that a plant in Wentzville, Missouri, could be spared, as it is
the only plant where Chevrolet Express and GMC Savana vans are
made. Business Journal quoted Mr. Stoddard as saying, "I would
think that they would keep that product going. In the long run
they are commercial vehicles and there is use for them. They are
used for construction jobs, fleets for major utility companies,
independent contactors and electricians and shuttle vehicles."
Bankruptcy Would Affect 114 Japanese Companies
Asia In Focus relates that GM's bankruptcy could affect a total of
114 Japanese firms that have some dealings with the Company. Many
of those companies, according to Asia In Focus, will likely face
difficulty in recovering debt. Citing Teikoku Databank Ltd., Asia
In Focus says reports that 102 Japanese companies might fail to
recover at least some of their accounts receivable with GM.
Opel Bankruptcy May Help Firm, Minister Says
Karin Matussek at Bloomberg News states that German Economy
Minister Karl- Theodor zu Guttenberg said last week that an
"orderly insolvency" may be the best rescue option for Opel unit.
Bloomberg relates that Peter Struck -- parliamentary leader of the
Social Democratic Party, a partner in Germany's coalition
government -- finds Mr. Guttenberg's statement "very strange.
Everybody knows what insolvency in Germany means: a company is
bust and goes downhill."
Saab Talks Ongoing Despite GM's Possible Bankruptcy
Reuters reports that Saab Automobile said that its sale process
and talks with three potential suitors wasn't disrupted by the
possibility of a bankruptcy filing by GM. According to Reuters,
Saab spokesperson Gunilla Gustavs said that the company remains
confident it can present a suitable candidate for a deal soon.
Possible buyers were undoubtedly considering the possible impact
of a GM bankruptcy filing, the report states, citing Ms. Gustavs.
Analysts: Bankruptcy Won't Have Serious Impact on China Unit
Citing analysts, Fang Yan and Edmund Klamann at Reuters relate
that a Chapter 11 filing by GM wouldn't have any serious impact on
the Company's China unit, which is one of its few profitable
operations. Executives said that GM's China division, primarily
two ventures with SAIC Motor, is profitable and self-sufficient,
and able to fund its own daily operations and expansion.
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.
As reported by the Troubled Company Reporter, GM reported net loss
of $6.0 billion, including special items, in the first quarter of
2009. This compares with a reported net loss of $3.3 billion in
the year-ago quarter. Excluding special items, the Company
reported an adjusted net loss of $5.9 billion in the first quarter
of 2009 compared to an adjusted net loss of $381 million in the
first quarter of 2008. As of March 31, 2009, GM had $82.2 billion
in total assets and $$172.8 billion in total liabilities,
resulting in $90.5 billion in stockholders' deficit.
On April 27, General Motors presented the U.S. Department of
Treasury with an updated plan as required by the loan agreement
signed by GM and the U.S. Treasury on December 31, 2008. The plan
addresses the key restructuring targets required by the loan
agreement, including a number of the critical elements of the plan
that was submitted to the U.S. government on December 2, 2008.
Among these are: U.S. market competitiveness; fuel economy and
emissions; competitive labor cost; and restructuring of the
company's unsecured debt. It also includes a timeline for
repayment of the Federal loans, and an analysis of the Company's
positive net present value. The plan details the future reduction
of GM's vehicle brands and nameplates in the U.S., further
consolidation in its workforce and dealer network, accelerated
capacity actions and enhanced manufacturing competitiveness, while
maintaining GM's strong commitment to high-quality, fuel-efficient
vehicles and advanced propulsion technologies.
GM also launched a bond exchange offer for roughly $27 billion of
unsecured public debt. If successful, the bond exchange would
result in the conversion of a large majority of this debt to
equity.
GM is also in talks with the UAW to modify the terms of the
Voluntary Employee Benefit Association, and with the U.S. Treasury
regarding possible conversion of its debt to equity. The current
bond exchange offer is conditioned on the converting to equity of
at least 50% of GM's outstanding U.S. Treasury debt at June 1,
2009, and at least 50% of GM's future financial obligations to the
new VEBA. GM expects a debt reduction of at least $20 billion
between the two actions.
In total, the U.S. Treasury debt conversion, VEBA modification and
bond exchange could result in at least $44 billion in debt
reduction.
GM filed with the Securities and Exchange Commission a
registration statement related to its exchange offer. The filing
incorporates the revised Viability Plan. A full-text copy of the
filing is available at http://ResearchArchives.com/t/s?3c09
A full-text copy of GM's viability plan presented in February 2009
is available at http://researcharchives.com/t/s?39a4
Going Concern Doubt
Deloitte & Touche LLP, has said there is substantial doubt about
GM's ability to continue as a going concern after reviewing GM's
2008 financial report. Deloitte cited the Company's recurring
losses from operations, stockholders' deficit and failure to
generate sufficient cash flow to meet the Company's obligations
and sustain the its operations. It said GM's future is dependent
on the Company's ability to execute the Company's Viability Plan
successfully or otherwise address these matters. If the Company
fails to do so for any reason, the Company would not be able to
continue as a going concern and could potentially be forced to
seek relief through a filing under the U.S. Bankruptcy Code.
Standard & Poor's Ratings Services on April 10 lowered its issue-
level rating on GM's $4.5 billion senior secured revolving credit
facility to 'CCC-' (one notch above the 'CC' corporate credit
rating on the company) from 'CCC'. It revised the recovery rating
on this facility to '2' from '1', indicating its view that lenders
can expect substantial (70% to 90%) recovery in the event of a
payment default. The corporate credit rating remains unchanged,
at 'CC', reflecting its view of the likelihood that GM will
default -- through either a bankruptcy or a distressed debt
exchange.
Moody's Investors Service said February 18 that the risk of a
bankruptcy filing by GM and Chrysler remains high. The last
rating action on GM and Chrysler was a downgrade of their
Corporate Family Ratings to Ca on December 3, 2008.
GENTA INC: Postpones Meeting of Stockholders on Securities Deal
---------------------------------------------------------------
Genta Incorporated postponed its special meeting of stockholders,
which was scheduled for May 27, 2009. The Company expects to
announce a new date for the special meeting in the near future.
As reported in the Troubled Company Reporter on May 14, 2009, the
Company entered into a securities purchase agreement with certain
accredited institutional investors to place up to $12 million of
senior secured convertible notes -- 2009 Notes -- and
corresponding warrants to purchase common stock. The Company
closed on approximately $6 million of the notes and warrants on
April 2, 2009.
The Company recommended to its stockholders that they provide
authorization to the Company's board of directors to effect a
reverse split in any ratio from 1:2 to 1:100.
Genta Incorporated -- http://www.genta.com/-- is a
biopharmaceutical company with a diversified product portfolio
that is focused on delivering innovative products for the
treatment of patients with cancer. Two major programs anchor the
Company's research platform: DNA/RNA-based Medicines and Small
Molecules. Genasense(R) (oblimersen sodium) Injection is the
Company's lead compound from its DNA/RNA Medicines program. The
leading drug in Genta's Small Molecule program is Ganite(R)
(gallium nitrate injection), which the Company is exclusively
marketing in the U.S. for treatment of symptomatic patients with
cancer related hypercalcemia that is resistant to hydration. The
Company has developed G4544, an oral formulation of the active
ingredient in Ganite, which has recently entered clinical trials
as a potential treatment for diseases associated with accelerated
bone loss. The Company is also developing tesetaxel, a novel,
orally absorbed, semi-synthetic taxane that is in the same class
of drugs as paclitaxel and docetaxel. Ganite and Genasense are
available on a "named-patient" basis in countries outside the
United States.
As reported in the Troubled Company Reporter on May 14, 2009,
Genta Incorporated said it currently projects that it will run out
of funds in June 2009 absent additional funding. Moreover, the
Company does not have any additional financing in place. If the
Company is unable to raise additional funds, it could be required
to reduce its spending plans, reduce its workforce, license or
sell assets or products it would otherwise seek to commercialize
on its own, or file for bankruptcy. There can be no assurance
that the Company can obtain financing, if at all, on acceptable
terms.
Genta said its recurring losses and negative cash flows from
operation raise substantial doubt about its ability to continue as
a going concern.
GEORGIA GULF: Executives Elect to Forfeit Options to Buy Shares
---------------------------------------------------------------
Georgia Gulf Corporation disclosed in a filing with the Securities
and Exchange Commission that on May 22, 2009, certain executive
officers of the Company voluntarily elected to forfeit certain
options to purchase shares of the Company's common stock with an
exercise price of $53.38 granted on February 28, 2005. The
purpose of these forfeitures is to return the shares to the
Company so that the Company may make further grants to other
employees.
These executive officers did not receive any consideration for the
forfeited options. The form of forfeiture notice contains the
acknowledgment of the forfeiting officer that no commitments to
grant any replacement equity awards were made by the Company.
Name and Title Shares
-------------- ------
Paul Carrico, president and chief executive officer 5,000
Joel Beerman, VP, general counsel and secretary 14,500
Mark Seal, vice president of aromatics and additives 14,500
James Worrell, vice president of human resources 5,000
William Doherty, vice president of pvc compounds 14,500
Doug Shannon, vice president of procurement 14,500
Mark Buckis, vice president and corporate controller 3,600
About Georgia Gulf
Georgia Gulf Corporation is a manufacturer and international
marketer of two integrated chemical product lines, chlorovinyls
and aromatics. The Company's primary chlorovinyls products are
chlorine, caustic soda, vinyl chloride monomer (VCM), vinyl resins
and vinyl compounds. Its aromatics products are cumene, phenol
and acetone. The Company has four business segments: chlorovinyls;
window and door profiles, and moldings products; outdoor building
products, and aromatics.
As of December 31, 2008, the Company's balance sheet showed total
assets of $1.61 billion and total liabilities of $1.75 billion
resulting in total stockholders' deficit of $139.92 million. As
of December 31, 2008, the Company had $90 million of cash on hand
as well as $143 million of borrowing capacity available under its
revolving credit facility. The Company reduced net debt by
$83 million during 2008 and was in compliance with its debt
covenants for the quarter ended December 31, 2008.
At March 31, 2009, the Company had $1.56 billion in total assets
and $1.66 billion in total liabilities, resulting in $97.3 million
stockholders' deficit.
* * *
As reported in the Troubled Company Reporter on May 26, 2009,
Moody's Investors Service lowered Georgia Gulf Corporation's
Probability of Default Rating from Caa3 to Caa3/LD reflecting the
deemed limited default due to the non-payment of interest on its
9.5% Guaranteed Sr. Unsecured Notes due 2014 and the 10.75% Sr.
Subordinated Notes due 2016. Georgia Gulf is currently operating
under a forbearance agreement with these noteholders and this debt
is subject to an exchange offer.
GLOBAL GREENERY: Equity Receiver Can't Assert Creditors' Claims
---------------------------------------------------------------
Under Arizona law, WestLaw reports, the equity receiver of
corporations could not assert fraudulent transfer causes of action
assertable by creditors of the receivership entities in the
absence of either a grant of specific authority to assert such
causes of action in the order appointing him or an assignment of
such causes of action by the creditors. Thus, the receiver, who
had been granted the powers and obligations of a debtor-in-
possession pursuant to 11 U.S.C. Sec. 1107(a), could not pursue
such claims on creditors' behalf. In re Global Grounds Greenery,
LLC, --- B.R. ----, 2009 WL 1395799 (Bankr. D. Ariz.).
Global Grounds Greenery, LLC, filed for chapter 11 protection
(Bankr. D. Ariz. Case No 06-01701) on June 8, 2009. Together with
a number of affiliates, including Enti, Inc., the debtors estimate
they have $10 million to $50 million in assets. The debtors are
represented by Alan A. Meda, Esq., at Stinson Morrison Hecker LLP
in Phoenix.
GOTTSCHALKS INC: Forever 21 Wins Firm's 12 Leased Locations
-----------------------------------------------------------
Courtenay Edelhart at Bakersfield.com reports that Forever 21 Inc.
has won in a bid for a dozen leased locations being vacated by
Gottschalks department stores and which were auctioned earlier
last week as part of the Company's bankruptcy proceedings.
According to Bakersfield.com, the acquisition may be part of
Forever 21's plan to open larger stores in vacated anchor spots.
Valley Plaza general manager Donna Berlin said that she had no
idea whether the mall's Forever 21 store would move into the old
Gottschalks spot or if the new space was obtained for one of the
chain's other brands, the report related.
Headquartered in Fresno, California, Gottschalks Inc. (Pink
Sheets: GOTTQ.PK) -- http://www.gottschalks.com/-- is a regional
department store chain, operating 58 department stores and three
specialty apparel stores in six western states. Gottschalks
offers better to moderate brand-name fashion apparel, cosmetics,
shoes, accessories and home merchandise.
The Company filed for Chapter 11 protection on January 14, 2009
(Bankr. D. Del. Case No. 09-10157). O'Melveny & Myers LLP
represents the Debtor in its Chapter 11 case. Lee E. Kaufman,
Esq., and Mark D. Collins, Esq., at Richards, Layton & Finger,
P.A., will serve as the Debtors' co-counsel. The Debtor selected
Kurtzman Carson Consultants LLC as its claims agent. The U.S.
Trustee for Region 3 appointed seven creditors to serve on an
Official Committee of Unsecured Creditors. When the Debtor filed
for protection from its creditors, it listed $288,438,000 in
total assets and $197,072,000 in total debts as of January 3,
2009.
GREATER ATLANTIC: Banking Unit Consents Appointment of Conservator
------------------------------------------------------------------
Greater Atlantic Financial Corp.'s banking subsidiary, Greater
Atlantic Bank, entered into a Stipulation and Consent to the
issuance of a Prompt Corrective Action Directive with the Office
of Thrift Supervision effective May 22, 2009.
By entering into the Stipulation and Consent, the Bank consented
to the appointment by the OTS of a conservator or receiver or
other legal custodian at any time the Bank is significantly
undercapitalized. The Stipulation and Consent addresses the
Bank's failure to operate under an accepted capital restoration
plan and imposes various corrective measures and operational
limitations mandated by statute. As of March 31, 2009, the Bank
was significantly undercapitalized for purposes of the prompt
corrective action provisions of the Federal Deposit Insurance Act.
The Directive was issued when the OTS notified the Bank that its
filed capital restoration plan was unacceptable and directs the
Bank to be recapitalized by a merger with or being acquired by
another financial institution or other entity, or by the sale of
all or substantially all of the Bank's assets and liabilities to
another financial institution or other entity, within 10 days of
the effective date of the Directive pursuant to a written
definitive agreement, which the Bank is required to submit to the
OTS within 5 days of the effective date of the Directive unless
extended in writing by the OTS.
By letter dated May 22, 2009, the OTS modified the Directive to
extend the 5 day time frame to June 15, 2009, and the 10 day
recapitalization deadline to July 31, 2009. The Directive also
authorizes the OTS to undertake marketing efforts to assist the
Bank in its efforts to consummate a possible recapitalization
transaction.
The Directive also requires the Bank to achieve and maintain, at a
minimum, these ratios within 10 days from the effective date of
the Directive:
(i) Total Risk Based Capital Ratio of 8%;
(ii) Tier 1 Core Risk Based Capital Ratio of 4%; and
(iii) Leverage Ratio of 4%.
The Directive also outlines guidelines for reporting to the OTS
the status of capital raising efforts and identifies mandatory
operating restrictions, including those under which the Bank has
been operating since the issuance of the previously reported Cease
and Desist Order effective April 25, 2008.
A full text copy of the STIPULATION AND CONSENT TO PROMPT
CORRECTIVE ACTION DIRECTIVE is available for free at
http://ResearchArchives.com/t/s?3d68
About Greater Atlantic
Greater Atlantic Financial Corp. is a bank holding company whose
principal activity is the ownership and management of Greater
Atlantic Bank. The bank originates commercial, mortgage and
consumer loans and receives deposits from customers located
primarily in Virginia, Washington, D.C. and Maryland. The bank
operates under a federal bank charter and provides full banking
services.
As of December 31, 2008, the Company's balance sheet showed total
assets of $215,151,000 and total liabilities of $222,905,000,
resulting in total stockholders' deficit of $7,754,000.
Going Concern Doubt
The Troubled Company Reporter reported on January 21, 2009, that
BDO Seidman, LLP, in Richmond, Virginia, in a letter dated
January 12, 2009, to the Board of Directors and Stockholders of
Greater Atlantic Financial Corp. expressed substantial doubt about
the company's ability to continue as a going concern. The firm
audited the consolidated statements of financial condition of
Greater Atlantic Financial Corp. and its subsidiaries as of
September 30, 2008, and 2007 and the related consolidated
statements of operations, stockholders' equity (deficit),
comprehensive income (loss) and cash flows for each of the two
years in the period ended September 30, 2008.
HARRAH'S ENTERTAINMENT: Two Units Propose $1 Bil. Debt Offering
---------------------------------------------------------------
Harrah's Operating Escrow LLC and Harrah's Escrow Corporation,
wholly-owned unrestricted subsidiaries of Harrah's Operating
Company Inc., are proposing to issue $1 billion aggregate
principal amount of senior secured notes due 2017 in a private
offering that is exempt from the registration requirements of the
Securities Act of 1933, as amended.
The offer is subject to a number of conditions, including the
amendment of the existing senior secured credit facilities of
Harrah's Operating Company Inc. to permit, among other things, the
incurrence of additional senior secured indebtedness on a pari
passu basis with lenders thereunder, according to Harrah's
Entertainment Inc. Upon satisfaction of certain conditions,
Harrah's Operating Company would assume the escrow issuers'
obligations under the Notes.
Harrah's Entertainment Inc. said it intends to use the net
proceeds from this private offering to retire a portion of
Harrah's existing term loan and revolving credit indebtedness
under Harrah's Operating Company Inc.'s senior secured credit
facilities and for general corporate purposes.
About Harrah's Entertainment
Las Vegas, Nevada-based Harrah's Entertainment, Inc. --
http://www.harrahs.com/-- operates nearly 40 casinos across the
United States, primarily under the Harrah's(R), Caesars(R) and
Horseshoe(R) brand names; Harrah's also owns the London Clubs
International family of casinos and the World Series of Poker(R).
Private equity firms Apollo Global Management and TPG Capital LP
acquired Harrah's in January for $31 billion.
At September 30, 2008, the Company's consolidated condensed
balance sheets showed total assets of $37.0 billion, total
liabilities of $33.4 billion and stockholders' equity of
$3.6 billion. For three months ended September 30, 2008, the
company reported net loss of $129.7 million compared with net
income of $244.4 million for the same period in the previous year.
For nine months ended September 30, 2008, the company posted net
loss of $100.9 million compared with net income of $667.2 million
for the same period in the previous year. The Company's cash and
cash equivalents, including funds borrowed during the quarter
under its credit facilities, totaled approximately $1.0 billion at
September 30, 2008, compared to $654.7 million at September 30,
2007.
* * *
As reported by the Troubled Company Reporter on May 29, 2009,
Standard & Poor's Ratings Services placed its 'CCC' corporate
credit rating for Las Vegas-based gaming company Harrah's
Entertainment Inc. and its wholly owned subsidiary, Harrah's
Operating Co. Inc., along with all issue-level ratings on Harrah's
debt, on CreditWatch with positive implications.
The TCR also reported that Moody's Investors Service assigned a
Caa3 rating to the proposed $1.0 billion first lien notes due 2017
to be issued by Harrah's Operating Escrow LLC and Harrah's Escrow
Corporation, both wholly owned subsidiaries of Harrah's Operating
Company, Inc. Proceeds from the new first lien notes will be used
to repay outstanding bank debt.
HARTMARX CORP: Wells Fargo Opposes Emerisque's Offer for Firm
-------------------------------------------------------------
The group of banks led by Wells Fargo & Company as agent, which
has provided credit to Hartmarx Corp., said that it opposes
Emerisque Brands U.K. Limited's offer to acquire Hartmarx, which
has been in Chapter 11 since January 2009 and has been unable to
repay more than $114 million that it owes the bank group.
The group said it opposes the offer because Emerisque fails to
provide adequate value to Hartmarx's lenders -- who have funded
Hartmarx throughout its bankruptcy including, most recently, up to
$20 million in additional advances -- and also because Emerisque's
offer does not even ensure that Emerisque will continue running
Hartmarx's business operations after the acquisition.
Emerisque's offer requires selling significant pieces of Hartmarx
soon after the acquisition, risking Hartmarx jobs at several U.S.
factories and distribution centers. Specifically, Emerisque has
committed to sell Hartmarx factories in Rock Island, Illinois, and
Cape Girardeau, Missouri, and its distribution centers in Easton,
Pennsylvania, and Rector, Arkansas, all within three months of the
acquisition.
Also, Emerisque is unwilling to assume Hartmarx's obligations to
its employees, including health care benefits, retirement,
workers' compensation, or union contract obligations and does not
even commit to rehire a specific number of Hartmarx employees.
Instead, Emerisque is merely obligated to disclose within one week
of acquiring Hartmarx the number of employees Emerisque intends to
hire. If Emerisque intends to keep Hartmarx's business intact,
the lending group believes Emerisque should be required to say up
front how many of Hartmarx's employees it will keep and for how
long.
The cash portion of Emerisque's offer has been stated to be
$70.5 million. This amount, however, is subject to a working
capital adjustment that, based on Hartmarx's projections, likely
will reduce the cash consideration to less than $56 million. This
payment would be less than half the total debt Hartmarx owes its
lenders. Yet, before repaying Hartmarx's lenders, Emerisque
proposes to pay millions of dollars to Hartmarx creditors who are
not entitled to be paid under the Bankruptcy Code before
Hartmarx's lenders.
Emerisque's offer also lacks financing and capital commitments to
fund its purchase, as well as a standard requirement for Emerisque
to make a good faith deposit as part of its purchase.
For all these reasons, the lending group believes Emerisque's
offer does not maximize the value of Hartmarx's assets, nor does
it guarantee the continued operation of the company's current
business.
Wachovia Also Objects to Emerisque Bid
Bankruptcy Law360 reports that Wachovia Capital Finance Corp. has
filed an objection to a bid by Emerisque Brands UK Ltd. and SKNL
North America BV to purchase Hartmarx Corp.'s assets, arguing that
the offer falls far short of covering the Debtor's outstanding
debt.
Before filing for bankruptcy, the Debtors entered into a
$200 million senior revolving credit facility pursuant to a
certain loan and security agreement with Wachovia Capital, which
is secured by substantially all the Debtors' personal property and
fixtures including account receivable. Outstanding principal
obligations under facility including outstanding letters of credit
is approximately $114 million.
As reported in the Troubled Company Reporter on May 26, 2009, the
Debtor entered into a "stalking horse" asset purchase agreement
with Emerisque Brands U.K. Limited and SKNL North America, B.V.
for substantially all assets of Hartmarx. Hartmarx said it filed
motions with the U.S. Bankruptcy Court for the Northern District
of Illinois to conduct what is known as a 363 sale of assets,
which allows for an expedited sale process with the aim of
preserving maximum value for all stakeholders. Under the terms of
the agreement, which is subject to court approval and certain
other closing conditions, the buyer will acquire substantially all
of the assets for $70.5 million in cash and a Junior Secured Note
with a face value of $15.0 million, subject to adjustment as of
the closing date for changes in the company's borrowing base. The
buyer has also agreed to assume certain liabilities of Hartmarx
estimated to total approximately $33.5 million.
Moelis & Company LLC and FTI Consulting, Inc., are the Company's
financial advisors. Skadden, Arps, Slate, Meagher & Flom, LLP,
are the company's legal advisors.
Emerisque Talks Back
Emerisque in a news statement dated May 29, 2009, said: "The
bankruptcy process allowed the company, its creditors, and
ultimately the Court to determine what is in the best interest of
the estate. We recognize that Wells Fargo, as a critical
component of this process, is entitled to state its opinion with
regard to our proposed acquisition of the assets of Hartmarx.
However, we vehemently object to the blatant distortion of the
facts that is occurring so late in the process in an attempt to
impact the outcome on Monday.
"The only factual component of the Wells Fargo statement today is
that they believe they should realize a higher cash return on
their claim. There is a significant gap between their expectations
and the reality of where asset valuations are in the current
market. Hartmarx ran a sale process that has lasted almost four
months before selecting Emerisque as the stalking horse bidder.
The fact that the highest bid was selected after such a lengthy
process surely tells its own story. The Emerisque bid is fully
diligenced, and financing and ability to close are as certain as
is possible at this stage of the process and in this environment.
Any suggestion otherwise is simply not truthful.
"Furthermore, all that a stalking horse does is establish a
'floor' value for an auction. It would appear to us that Wells
Fargo prefers a liquidation.
"In addition, as the only bidder prepared to operate Hartmarx as a
going concern, our commitment to preserving good union jobs and
"Made in America" is well documented and unwavering. We will
either assume the current collective bargaining agreement, or work
with the unions to execute a new agreement on mutually acceptable
terms. Any statement implying that we seek to de-unionize the
company is patently false, and a clear attempt to deflect union's
criticism and political pressure directed towards Wells Fargo.
"We are also concerned that Wells Fargo would manipulate the facts
with regard to the financial aspects of this transaction. For
example, their discussion around a downward adjustment to the cash
consideration fails to disclose that this would be driven only by
divestiture of significant assets, which would also mean that the
debt would come down.
"We are confident that the Bankruptcy Court will appropriately
consider the best interest of all stakeholders in review of the
highest and best offer, as required under the law. After this
exhaustive process, it is clear that the Emerisque is the best and
highest bid for the Company. Emerisque deserves to be named the
stalking horse on Monday."
About Hartmarx
Based in Chicago, Illinois, Hartmarx Corporation (HTMXQ) --
http://www.hartmarx.com/-- produces and markets business, casual
and golf apparel under its own brands, including Hart Schaffner
Marx, Hickey-Freeman, Palm Beach, Coppley, Monarchy, Manchester
Escapes, Society Brand, Racquet Club, Naturalife, Pusser's of the
West Indies, Brannoch, Sansabelt, Exclusively Misook, Barrie Pace,
Eye, Christopher Blue, Worn, One Girl Who . . . and b.chyll. In
addition, the company has certain exclusive rights under licensing
agreements to market selected products under a number of premier
brands such as Austin Reed, Burberry men's tailored clothing, Ted
Baker, Bobby Jones, Jack Nicklaus, Claiborne, Pierre Cardin, Lyle
& Scott, Golden Bear, Jag and Dr. Martens. The Company's broad
range of distribution channels includes fine specialty and leading
department stores, value-oriented retailers and direct mail
catalogs.
Hartmarx and certain affiliates filed for bankruptcy protection on
January 23, 2009 (Bankr. N.D. Ill. Lead Case No. 09-02046). George
N. Panagakis, Esq., Felicia Gerber Perlman, Esq., and Eric J.
Howe, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent
the Debtors in their restructuring efforts. When the Debtors
filed for bankruptcy, they listed $483,108,000 in total assets and
$261,220,000 in total debts as of August 31, 2008.
HCA INC: Earns $902 Million for Year Ended December 31
------------------------------------------------------
HCA Inc. reported $902 million net income on $28.37 billion in
revenues compared to $1.08 billion net income on $26.85 billion in
revenues for the year ended December 31, 2008.
The company disclosed that it has a $9.26 billion stockholders'
deficit as of December 31, 2008, compared to $9.60 billion
stockholders' deficit a year ago.
A full-text copy of the company's financial data for the year
ended December 31, 2008, is available for free at:
http://ResearchArchives.com/t/s?3d6a
Headquartered in Nashville, Tennessee, HCA Inc. --
http://www.hcahealthcare.com/-- is the nation's leading provider
of healthcare services. As of June 30, 2008, HCA operated 169
hospitals and 107 freestanding surgery centers, including eight
hospitals and eight freestanding surgery centers operated through
equity method joint ventures.
* * *
The Troubled Company Reporter said on May 8, 2009, Fitch Ratings
affirmed HCA Inc.'s ratings: Issuer Default Rating at 'B'; Secured
Bank Credit Facility at 'BB/RR1'; First Lien Notes at 'BB/RR1';
and Second Lien Notes at 'B+/RR3'.
HDGIANTS INC: Files for Chapter 11 Bankruptcy Protection
--------------------------------------------------------
Joseph Palenchar at TWICE reports that HDGiants, Inc., has filed
for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court
for District of Nevada.
TWICE quoted a former HDGiants executive as saying, "HDGiants was
running out of funds to go to the next level." Citing the
executive, TWICE states that HDGiants' private investors were
unable to agree on terms for raising additional capital.
According to the report, the former executive said, "All sales and
marketing are on hold."
TWICE relates that the former executive didn't know if HDGiants
would continue to offer its services under Chapter 11. According
to TWICE, the former executive said that HDGiants laid off its
sales and marketing staff.
Stephen R. Harris, Esq., at Belding, Harris & Petroni, Ltd.,
assists the Company in its restructuring efforts. The Company
listed $1,000,001 to $10,000,000 in assets and $1,000,001 to
$10,000,000 in debts.
HDGiants, Inc., which launched its music service in 2005, offers a
music-download service that provides compressed stereo and
multichannel music. The service downloads music from the big four
music labels and others to PCs and to select residential custom-
installed music servers, which are equipped with HDGiants
software. Those servers include models from Qsonix and Niveus
Media. Downloads are in protected and unprotected form. The
Company also offered a movie service in which, through custom
installers, consumers bought a home A/V server preloaded with
packages of 10 to 100 movies from Paramount and HDNet.
HERBST GAMING: In Talks With Lenders to Extend Lockup Agreement
---------------------------------------------------------------
Herbst Gaming, Inc., and certain of its subsidiaries are parties
to a letter agreement with:
(i) lenders holding, in the aggregate, approximately 68% in
amount of all of the outstanding claims under the
Company?s Second Amended and Restated Credit Agreement,
dated as of January 3, 2007, as amended;
(ii) Edward J. Herbst, Timothy P. Herbst and Troy D. Herbst, in
their capacities as equity holders of the Company; and
(iii) Terrible Herbst, Inc. and certain of its affiliates, in
their capacities as parties to agreements with the Company
and the Subsidiary Guarantors.
Chief Financial Officer Mary E. Higgins disclosed in a regulatory
filing that in the Lockup Agreement, the parties agreed to support
a restructuring of the Company and the Subsidiary Guarantors
pursuant to a joint plan of reorganization under Chapter 11 of the
United States Bankruptcy Code, in accordance with the terms set
forth in the Lockup Agreement. The Lockup Agreement provided for
automatic termination if a disclosure statement with respect to
the Proposed Plan was not approved by the Bankruptcy Court by May
21, 2009, unless the THI Parties and requisite Consenting Lenders
waived that requirement within five business days.
The Company and the Subsidiary Guarantors have not yet filed a
plan of reorganization and an accompanying disclosure statement
with the Bankruptcy Court because the parties to the Lockup
Agreement were still negotiating various terms and agreements. As
a result, Ms. Higgins says, a disclosure statement with respect to
the Proposed Plan was not approved by the Bankruptcy Court by the
May 21, 2009, deadline required by the Lockup Agreement, and the
THI Parties have advised the Company and the Consenting Lenders
that they do not intend to waive the requirement. The Company
remains in discussions with the Consenting Lenders regarding a
waiver of the requirement and continuation of the Lockup Agreement
between the Company and the Consenting Lenders. However, Ms.
Higgins adds, no assurances can be given that the Company will
reach agreement with the Consenting Lenders regarding an extension
of, and modifications to, the Lockup Agreement, which terminated
effective May 21, 2009 unless the Company and the Consenting
Lenders agree to its modification and extension. According to Ms.
Higgins, the Company expects to continue discussions with both the
lenders under the Senior Credit Facility and the THI Parties
regarding a plan of reorganization.
About Herbst Gaming Inc.
Headquartered in Reno, Nevada, Herbst Gaming Inc. --
http://www.herbstgaming.com/-- is an established casino and slot
route operator that operates casinos located in Nevada, Missouri
and Iowa. The Debtors own and operate approximately 6,800 slot
machines in its slot route business and is a slot machine operator
in Nevada. The Company and 17 of its affiliates filed for Chapter
11 protection on March 22, 2009 (Bankr. D. Nev. Lead Case No.
09-50752). Thomas H. Fell, Esq., Gordon Silver, represents the
Debtors in their restructuring efforts. Herbst Gaming had $919.1
million in total assets; and $33.5 million in total liabilities
not subject to compromise and $1.24 billion in liabilities subject
to compromise, resulting in $361.0 million in stockholders'
deficiency as of March 31, 2009.
INDYMAC FEDERAL: Creditors Have Until August 26 to File Claims
---------------------------------------------------------------
On March 19, 2009, the Office of Thrift Supervision closed IndyMac
Federal Bank, FSB, Pasadena, CA 91101 and appointed the Federal
Insurance Corporation as Receiver to handle all matters relating
to the failed institution.
All creditors having claims against IndyMac Federal must submit
their claims in writing, together with proof of the claims to the
Receiver by August 26, 2009, at:
FDIC as Receiver of IndyMac Federal Bank, FSB
40 Pacifica, 8th Floor, Irvine, CA 92618
Attention: Claims Agent
Depositors of the failed bank have until September 19, 2010, to
claim their deposits at OneWest. Unclaimed deposits will be
returned to the FDIC.
As reported in the Troubled Company Reporter on March 20, 2009,
the FDIC completed the sale of IndyMac Federal to OneWest, a newly
formed Pasadena, California-based federal savings bank organized
by IMB HoldCo LLC. Depositors of IndyMac Federal will
automatically become depositors of OneWest. Deposits will
continue to be insured by the FDIC.
Prior to its closing, IndyMac Federal Bank FSB was a hybrid
thrift/mortgage bank that originated mortgages in all 50 states of
the United States.
At January 31, 2009, IndyMac Federal had total assets of
$23.5 billion and total deposits of $6.4 billion. OneWest agreed
to purchase all deposits and approximately $20.7 billion in assets
at a discount of $4.7 billion. The FDIC will retain the remaining
assets for later disposition.
INTERFACE INC: Moody's Assigns 'B1' Rating on Senior Notes
----------------------------------------------------------
Moody's Investors Service assigned a B1 rating to Interface Inc.'s
proposed senior secured notes due 2013 to be issued under Rule
144A. Moody's also affirmed Interface's other ratings, including
its B1 corporate family and probability of default ratings and the
B3 rating on its subordinated notes. The ratings outlook remains
negative.
Proceeds from the proposed senior secured note, along with balance
sheet cash, will be used to repurchase/refinance Interface's
existing 10.375% senior unsecured notes that mature on February 1,
2010.
Interface's B1 corporate family rating considers the expectation
for a significant decline in revenue and earnings in 2009 due to
the weak global economic conditions and its impact on construction
spending. However, solid credit metrics and good liquidity
provide the company with moderate cushion in this challenging
economic environment. The rating is also supported by Interface's
leading market position in the modular carpet segment, strong
brand recognition and increased diversification away from the
corporate office market segment. The rating remains constrained
by Interface's heavy exposure to the cyclical corporate interiors
market, its narrow business focus with about 90% of revenues and
the bulk of operating income derived from the modular carpet
business, and continued uncertainty with regards to global capital
spending by both corporate and non-corporate entities.
Interface's liquidity will improve significantly with the new bond
issue, as it will address the large debt maturity set for February
2010. Liquidity continues to be supported by balance sheet cash
and excess availability under its revolving credit facilities,
along with the expectation for positive free cash flow generation
in 2009 due to cost cutting efforts, reduced capital spending and
dividends, and management's focus on improving working capital.
The negative outlook reflects Moody's concern that the severe
decline in global spending on building renovation and construction
projects will continue through 2009, placing downward pressure on
Interface's operating results and credit metrics.
The B1 rating on the proposed $150 million senior secured notes
reflects the benefits and limitations of the collateral package,
which includes a second priority lien in substantially all assets
of Interface, Inc., and its domestic subsidiaries, and all stock
of domestic subsidiaries and 65% of foreign subsidiaries. The
notes will also benefit from a guarantee by Interface's material
domestic subsidiaries.
Ratings assigned:
-- $150 million guaranteed senior secured notes due 2013 at B1
(LGD 3, 42%) to be issued under Rule 144A;
Ratings affirmed / LGD assessments revised:
-- Corporate Family Rating at B1;
-- Probability of Default Rating at B1;
-- 10.375% guaranteed senior unsecured notes due 2010 at B1 (LGD
3, 45%), to be withdrawn upon repayment;
-- 9.5% guaranteed senior subordinated notes due 2014 at B3 (LGD
5, 82%).
The prior rating action on Interface occurred on March 20, 2009
when Moody's affirmed the company's B1 corporate family rating and
changed the outlook to negative.
Interface, Inc., based in Atlanta, Georgia, is a worldwide leader
in the design, production and sales of modular carpet. The
company also holds a strong position in the high quality,
designer-oriented segment of the broadloom carpet market. Brand
names include InterfaceFLOR, FLOR, Huega, Bentley Prince Street,
Bentley Prince Street House and Home and Intercept. Revenues for
the year ended December 28, 2008, approached $1.1 billion.
INTERFACE INC: S&P Assigns 'BB-' Rating on $150 Mil. Senior Notes
-----------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its 'BB-'
issue-level rating with a recovery rating of '2' (indicating the
likelihood of substantial [70-90%] recovery in the event of a
payment default) to Interface Inc.'s proposed $150 million senior
secured notes due 2013. The company will use the proceeds from
the notes offering to repay the company's existing 10.375% senior
notes due 2010. The Atlanta, Georgia-based company had about
$277 million of debt as of April 5, 2009. The outlook on the 'B+'
corporate credit rating is negative.
The speculative-grade ratings on Interface reflect the competitive
and cyclical market conditions in the global floor covering
market, as well as the company's narrow business focus and heavy
dependence on the corporate office segment. However, S&P believes
Interface benefits from a significant market share (35%) in the
worldwide modular carpet segment, which has been growing faster
than the rest of the floor covering market for several years.
The negative outlook on Interface reflects the current challenging
economic environment, and S&P's expectation for a substantial
reduction in corporate spending, which S&P believes will
negatively affect the company's sales and profitability. Although
S&P estimates adjusted debt to EBITDA is currently below 3x as of
April 5, 2009, S&P believes a 25% sales decline and further
erosion in EBITDA margins of 200 basis points over the next year
could result in leverage approaching 4x. S&P could lower the
ratings on Interface if liquidity becomes constrained and/or if
the current difficult operating environment for carpet
manufacturers leads to a material deterioration in credit measures
well beyond 4x. Although less likely in the near term, S&P could
revise the outlook to stable following this refinancing, if the
operating environment improves and Interface can stabilize its
credit metrics.
Ratings List
Interface Inc.
Corp. credit rating B+/Negative/--
Ratings Assigned
Proposed $150 mil. sr secured notes due 2013 BB-
Recovery rating 2
ISTAR FINANCIAL: S&P Downgrades Senior Unsecured Rating to 'BB-'
----------------------------------------------------------------
Standard & Poor's Ratings Services said that it lowered its senior
unsecured debt rating on iStar Financial Inc. to 'BB-' from 'BB'.
At the same time, S&P affirmed its 'BB' long-term counterparty
credit rating and 'B-' preferred stock rating on iStar. The
senior unsecured rating was removed from CreditWatch with negative
implications where it had been placed on April 10, 2009. The
outlook is negative.
"The downgrade of iStar's senior unsecured debt results from the
May 2009 exchange offer, which increased the disadvantage of
senior unsecured creditors relative to secured creditors," said
Standard & Poor's credit analyst Jeffrey Zaun. Moreover, iStar's
deteriorating credit quality has rendered its unpledged assets
relatively less valuable than its encumbered assets. The exchange
offer increased the amount of assets that iStar has pledged for
secured borrowings to about $7.6 billion from $6.5 billion at
March 31, and $2.7 billion at year-end 2008. The reduction in
unencumbered assets and the high volume of troubled loans among
those assets has weakened the position of unsecured creditors.
S&P's rating on iStar already incorporates S&P's belief that the
amount of troubled assets could increase to more than $6 billion
and that recoveries on troubled assets, which have been good so
far, will deteriorate considerably. S&P could, however, downgrade
the firm if losses are greater than S&P now expects, placing
additional pressure on funding and capital levels, absent
offsetting actions. S&P could revise the outlook to stable if the
firm maintains stable capital and improves asset-quality metrics
while sustaining adequate recovery values for its troubled assets.
LEVI STRAUSS: Names Blake Jorgensen as New CFO & EVP
----------------------------------------------------
Levi Strauss & Co. named Blake Jorgensen the company?s new
executive vice president and chief financial officer, effective
July 1, 2009. Mr. Jorgensen is currently the chief financial
officer for Yahoo! Inc., a leading global Internet company. He
will report directly to LS&CO.?s Chief Executive Officer John
Anderson.
?Blake is a seasoned finance executive who brings a broad
background of leadership, operational and strategic experience to
Levi Strauss & Co.,? said Mr. Anderson. ?He has a successful track
record of working with global consumer product companies and his
deep financial experience will be a tremendous asset as we
continue to position the company for future growth.?
Prior to joining Yahoo!, Mr. Jorgensen co-founded Thomas Weisel
Partners in 1998, where he served as chief operating officer, co-
director of investment banking and a member of the Executive
Committee. He managed all aspects of the publicly traded
investment bank. Jorgensen also managed the investment bank?s
relationships with key investors and several strategic alliances
with international partners.
Before founding Thomas Weisel Partners, Mr. Jorgensen served as a
managing director and principal in the corporate finance
department of Montgomery Securities, where he oversaw the
integration of Montgomery Securities into NationsBank and Bank of
America. Earlier in his career, he worked as an independent
management consultant to global corporations and held strategic
planning and consulting positions with MAC Group/Gemini Consulting
and Marakon Associates.
?I?m excited to be part of an iconic company with leading global
brands,? said Mr. Jorgensen. ?The Levi?s(R) and Dockers(R) brands
are loved by consumers around the world. Based on the strength of
these brands, I believe there are tremendous opportunities ahead
for growth worldwide. I look forward to working with John Anderson
and the entire Levi Strauss & Co. worldwide leadership team to
realize this growth potential.?
Mr. Jorgensen takes over the chief financial officer role from
Heidi Manes, the company?s vice president and controller, who has
served as interim CFO for the past nine months.
?I want to thank Heidi for her strong leadership during the past
nine months and our entire finance leadership team for continuing
to build the financial strength of the company while we searched
for our new CFO,? said Mr. Anderson. ?Blake will work closely with
Heidi once he is on board to ensure a smooth transition.?
Mr. Jorgensen holds a Bachelor of Arts from Stanford University
with a major in Economics, and a Masters of Business
Administration from Harvard Business School.
According to The Associated Press, Mr. Jorgensen will receive a
severance payment of $1.8 million -- more than triple his salary
-- from Yahoo.
About Levi Strauss & Co.
Headquartered in San Francisco, California, Levi Strauss & Co. --
http://www.levistrauss.com/-- is one of the world's leading
branded apparel companies. The company designs and markets jeans,
casual and dress pants, tops, jackets and related accessories, for
men, women and children under the Levi's(R), Dockers(R) and
Signature by Levi Strauss & Co.(TM). The company markets its
products in three geographic regions: Americas, Europe and Asia
Pacific.
As reported by the Troubled Company Reporter on April 29, 2009,
Moody's Investors Service affirmed Levi Strauss & Co.'s Corporate
Family & Probability of Default ratings at B1 and also continued
its positive outlook on the company's ratings.
The TCR reported on November 28, 2008, that Fitch Ratings affirmed
these ratings on Levi Strauss & Co.:
-- Issuer Default Rating at 'BB-';
-- $750 million bank credit facility at 'BB+';
-- Senior unsecured notes at 'BB-';
-- Senior unsecured term loan 'BB-'.
The Rating Outlook is Stable. Approximately $1.68 billion of
senior unsecured debt and the bank credit facility is affected by
these actions.
LEVIS STRAUSS: To Acquire 73 Outlet Stores of Anchor Blue
---------------------------------------------------------
Levi Strauss & Co. said it agreed to acquire the operating rights
to 73 MOST stores, Anchor Blue Retail Group Inc.'s denim outlet
subsidiary, which carry Levi's(R) and Dockers(R) inventory.
"This proposed acquisition is a natural next step in our long-term
growth strategy," said Robert Hanson, president of Levi Strauss
Americas. "The outlet channel is poised for continued growth over
the near- and long-term. We believe that this transaction will
strengthen our ability to manage our brands' positioning
effectively in the outlet channel, will provide a profitable
growth opportunity for LS&CO., and will ensure that we can
continue to provide outlet shoppers with the great value and
world-class quality they expect from Levi's(R) and Dockers(R)
products," Mr. Hanson related.
Levi Strauss noted that Anchor Blue and its subsidiaries have
filed a voluntary petition under Chapter 11 of the U.S. Bankruptcy
Code in the Bankruptcy Court for the District of Delaware to enter
a 363 sale process to facilitate a restructuring and to seek Court
approval for the sale of the Levi's(R) and Dockers(R) stores to
it.
Completion of the transaction is subject to a number of closing
conditions, including the approval of the Bankruptcy Court, Levi
Strauss noted. Subject to conditions, the transaction is expected
to close in July. Anchor Blue has indicated its outlet stores
will remain open for business without interruption during the
period prior to closing the proposed acquisition, Levi Strauss
said.
About Anchor Blue
Headquartered in Ontario, Canada, Anchor Blue Retail Group Inc.
operates retail stories. The company and four of its affiliates
filed for Chapter 11 protection on May 27, 2009 (Bankr. D. Del.
Lead Case No. 09-11770). Chun I. Jang, Esq., and Jason M. Madron,
Esq., at Richards Layton & Finger P.A., represent the Debtors' in
their restructuring efforts. The Debtors listed assets less than
$50,000, and debts between $100 million to $500 million.
About Levi Strauss & Co.
Headquartered in San Francisco, California, Levi Strauss & Co. --
http://www.levistrauss.com/-- is one of the world's leading
branded apparel companies. The company designs and markets jeans,
casual and dress pants, tops, jackets and related accessories, for
men, women and children under the Levi's(R), Dockers(R) and
Signature by Levi Strauss & Co.(TM). The company markets its
products in three geographic regions: Americas, Europe and Asia
Pacific.
* * *
According to the Troubled Company Reporter on May 29, 2009,
Moody's Investors Service said Levi Strauss & Co. Inc.'s entry
into an Asset Purchase Agreement with Anchor Blue Retail Group has
no immediate impact on LS&Co's B1 Corporate Family Rating or the
positive rating outlook.
LITHIUM TECHNOLOGY: Sept. 30 Balance Sheet Upside-Down by $9MM
--------------------------------------------------------------
Lithium Technology Corporation filed a Form 10-Q for the quarter
ended September 30, 2008, with the Securities and Exchange
Commission.
At September 30, 2008, the Company's balance sheet showed total
assets of $11,019,000 and total liabilities of $20,412,000
resulting in a stockholders' deficit of $9,393,000.
For nine months ended September 30, 2008, the Company posted a net
loss of $2,087,000 compared with a net loss of $27,320,000 for the
same period in the previous year.
For three months ended September 30, 2009, the Company reported
net income of $261,000 compared with a net loss of $3,513,000 for
the same period in the previous year.
Liquidity and Financial Condition
On September 30, 2008, cash and cash equivalents were $296,000.
The Company's working capital deficit was $17,140,000 as compared
to $25,444,000 on December 31, 2007. The Company expects to incur
decreasing operating losses as it continues its commercialization
efforts.
A full-text copy of the 10-Q filing is available for free at
http://ResearchArchives.com/t/s?3d55
The Company also disclosed that Amper, Politziner & Mattia, LLP,
the Company's independent registered public accounting firm, has
not yet completed its review of the Company's September 2008
Financial Statements. Accordingly, all information contained in
the September 2008 Form 10-Q, including the September 2008
Financial Statements, is subject to update and revision and must
therefore not be relied upon. Amper is in the process of
completing its review of the September 2008 Financial Statements
and upon completion of the review, the Company will file with the
SEC an amendment to the September 2008 Form 10-Q.
About Lithium Technology Corp.
Lithium Technology Corp. is a global manufacturer of Li-ion cells
and a global provider of power solutions for diverse applications.
LTC is especially well positioned in the fast growing markets of
electrical cars and stationary power. The company expects results
to substantially improve in the near future.
LYONDELLBASELL: Andreas Heeschen Acquires 50% Equity Stake
----------------------------------------------------------
Andreas Heeschen's ProChemie Holding and Len Blavatnik's Access
Group created a joint venture known as ProChemie GmbH, with each
party owning 50% in equity of LyondellBasell Industries, AF
S.C.A., ICIS.com reports.
As new part-owner of LBI, Mr. Heeschen will assume the role of a
hands-off yet strategic investor, noted Heeschen's spokersperson,
ICIS.com relates. Mr. Heeschen is a German investor who made his
fortune in real estate and through his investment company, Pall
Mall Capital, ICIS.com says.
Officials of ProChemie said that they support LBI's ongoing
restructuring and that the joint venture will have no impact on
LBI and its debtor-affiliates' daily operations under Chapter 11,
PRW.com says.
About Lyondell
LyondellBasell Industries is one of the world's largest polymers,
petrochemicals and fuels companies. It is the global leader in
polyolefins technology, production and marketing; a pioneer in
propylene oxide and derivatives; and a significant producer of
fuels and refined products, including biofuels. Through research
and development, LyondellBasell develops innovative materials and
technologies that deliver exceptional customer value and products
that improve quality of life for people around the world.
Headquartered in The Netherlands, LyondellBasell --
http://www.lyondellbasell.com/-- is privately owned by Access
Industries.
Basell AF and Lyondell Chemical Company merged operations in 2007
to form LyondellBasell Industries, the world's third largest
independent chemical company. LyondellBasell became saddled with
debt as part of the US$12.7 billion merger. About a year after
completing the merger, LyondellBasell Industries' U.S. operations
and one of its European holding companies -- Basell Germany
Holdings GmbH -- filed voluntary petitions to reorganize under
Chapter 11 of the U.S. Bankruptcy Code on January 6, 2009, to
facilitate a restructuring of the company's debts. The case is In
re Lyondell Chemical Company, et al., Bankr. S.D. N.Y. Lead Case
No. 09-10023). Seventy-nine Lyondell entities, including Equistar
Chemicals, LP, Lyondell Chemical Company, Millennium Chemicals
Inc., and Wyatt Industries, Inc., filed for Chapter 11. In May
2009, one of the cases was dismissed -- Case No. 09-10068 --
because it is duplicative of Case No. 09-10040 relating to Debtor
Glidden Latin America Holdings.
The Hon. Robert E. Gerber presides over the case. Deryck A.
Palmer, Esq., at Cadwalader, Wickersham & Taft LLP, in New York,
serves as the Debtors' bankruptcy counsel. Evercore Partners
serves as financial advisors, and Alix Partners and its subsidiary
AP Services LLC, serves as restructuring advisors. AlixPartners'
Kevin M. McShea acts as the Debtors' Chief Restructuring Officer.
Clifford Chance LLP serves as restructuring advisors to the
European entities. Lyondell Chemical estimated that consolidated
assets total US$27.12 billion and debts total US$19.34 billion as
of the bankruptcy filing date.
Lyondell has obtained approximately $8 billion in DIP financing to
fund continuing operations. The DIP financing includes two credit
agreements: a $6.5 billion term loan (comprising $3.25 billion in
new loans and a $3.25 billion roll-up of existing loans) and a
$1.57 billion asset-backed lending facility.
Luxembourg-based LyondellBasell Industries AF S.C.A. and another
affiliate were voluntarily added to Lyondell Chemical's
reorganization filing under Chapter 11 on April 24, 2009 in order
to seek protection against claims by certain financial and U.S.
trade creditors. On May 8, 2009, LyondellBasell Industries added
13 non-operating entities to Lyondell Chemical Company's
reorganization filing under Chapter 11 of the U.S. Bankruptcy
Code. All of the entities are U.S. companies and were added to
the original Chapter 11 filing for administrative purposes. The
filings will have no impact on current business or operations as
none of the entities manufactures or sells products.
Bankruptcy Creditors' Service, Inc., publishes Lyondell Bankruptcy
News. The newsletter tracks the Chapter 11 proceeding undertaken
by Lyondell Chemical Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
LYONDELL CHEMICAL: Veolia ES Removed From Creditors' Committee
--------------------------------------------------------------
Pursuant to Section 1102 of the Bankruptcy Code, Diana G. Adams,
United States Trustee for Region 2, submitted to the United States
Bankruptcy Court for the Southern District of New York on May 27,
2009, a list removing Veolia ES Industrial Services, as a creditor
appointed to serve as member of the Official Committee of
Unsecured Creditors in Lyondell Chemical Company and its 92
debtor-affiliates' Chapter 11 cases:
The Creditors' Committee now comprises of:
1) Wilmington Trust FSB, as Successor Trustee
Attn: Patrick Healy, Vice President
Rodney Square North
1100 North Market Street
Wilmington, DE 19890-1600
Tel. No. (302) 636-6391
2) Law Debenture Trust of New York
Attn: Robert L. Bice II, Senior Vice President
400 Madison Avenue
New York, NY 10017
Tel. No. (212) 750-6474
3) Pension Benefit Guaranty Corporation
Attn: Jennifer Messina
1200 K. Street N.W. - Suite 2000
Washington, DC 20004
Tel. No.(202) 750-6474
4) BASF Corporation
Attn: Peter Argiriou, Credit Manager
100 Campus Drive
Florham Park, NJ 07932
Tel. No. (713) 759-3092
5) Air Liquide Large Industries U.S.LP
c/o Air Liquide USA, LLC
Attn: Kevin Feeney, Esq., Secretary of Air Liquide
2700 Post Oak Blvd.
Houston, TX 77056
Tel. No. (713) 624-8386
6) United Steel Workers
Attn: David R. Jury, Associate General Counsel
Five Gateway Center - Room 807
Pittsburgh, PA 15222
Tel. No. (412) 562-2546
7) James Schorr
8781 La Palma Ln
Naples, FL 34108
Tel. No. (239) 593-1043
8) Bernard Sander
14818 Sparkling Bay
Houston, TX 77062
Tel. No. (281) 480-0704
About Lyondell Chemical
LyondellBasell Industries is one of the world's largest polymers,
petrochemicals and fuels companies. It is the global leader in
polyolefins technology, production and marketing; a pioneer in
propylene oxide and derivatives; and a significant producer of
fuels and refined products, including biofuels. Through research
and development, LyondellBasell develops innovative materials and
technologies that deliver exceptional customer value and products
that improve quality of life for people around the world.
Headquartered in The Netherlands, LyondellBasell --
http://www.lyondellbasell.com/-- is privately owned by Access
Industries.
Basell AF and Lyondell Chemical Company merged operations in 2007
to form LyondellBasell Industries, the world's third largest
independent chemical company. LyondellBasell became saddled with
debt as part of the US$12.7 billion merger. About a year after
completing the merger, LyondellBasell Industries' U.S. operations
and one of its European holding companies -- Basell Germany
Holdings GmbH -- filed voluntary petitions to reorganize under
Chapter 11 of the U.S. Bankruptcy Code on January 6, 2009, to
facilitate a restructuring of the company's debts. The case is In
re Lyondell Chemical Company, et al., Bankr. S.D. N.Y. Lead Case
No. 09-10023). Seventy-nine Lyondell entities, including Equistar
Chemicals, LP, Lyondell Chemical Company, Millennium Chemicals
Inc., and Wyatt Industries, Inc., filed for Chapter 11. In May
2009, one of the cases was dismissed -- Case No. 09-10068 --
because it is duplicative of Case No. 09-10040 relating to Debtor
Glidden Latin America Holdings.
The Hon. Robert E. Gerber presides over the case. Deryck A.
Palmer, Esq., at Cadwalader, Wickersham & Taft LLP, in New York,
serves as the Debtors' bankruptcy counsel. Evercore Partners
serves as financial advisors, and Alix Partners and its subsidiary
AP Services LLC, serves as restructuring advisors. AlixPartners'
Kevin M. McShea acts as the Debtors' Chief Restructuring Officer.
Clifford Chance LLP serves as restructuring advisors to the
European entities. Lyondell Chemical estimated that consolidated
assets total US$27.12 billion and debts total US$19.34 billion as
of the bankruptcy filing date.
Lyondell has obtained approximately $8 billion in DIP financing to
fund continuing operations. The DIP financing includes two credit
agreements: a $6.5 billion term loan (comprising $3.25 billion in
new loans and a $3.25 billion roll-up of existing loans) and a
$1.57 billion asset-backed lending facility.
Luxembourg-based LyondellBasell Industries AF S.C.A. and another
affiliate were voluntarily added to Lyondell Chemical's
reorganization filing under Chapter 11 on April 24, 2009 in order
to seek protection against claims by certain financial and U.S.
trade creditors. On May 8, 2009, LyondellBasell Industries added
13 non-operating entities to Lyondell Chemical Company's
reorganization filing under Chapter 11 of the U.S. Bankruptcy
Code. All of the entities are U.S. companies and were added to
the original Chapter 11 filing for administrative purposes. The
filings will have no impact on current business or operations as
none of the entities manufactures or sells products.
Bankruptcy Creditors' Service, Inc., publishes Lyondell Bankruptcy
News. The newsletter tracks the Chapter 11 proceeding undertaken
by Lyondell Chemical Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
LYONDELL CHEMICAL: Seeks to Deliver $15.3MM LOC to Sumitomo
-----------------------------------------------------------
Lyondell Chemical Company and its 92 debtor-affiliates ask the
United States Bankruptcy Court for the Southern District of New
York to authorize Debtor Houston Refining, LP:
(i) to use property of the estate to purchase certain
replacement coke drums from Sumitomo Heavy Industries,
Ltd. pursuant to (x) prepetition Purchase Order General
Terms and Conditions between Houston Refining and
Sumitomo, as amended, and (y) Purchase Order dated
March 26, 2009, among Houston Refining, Foster Wheeler USA
Corporation, and Sumitomo; and
(ii) in connection with the purchase of the New Drums, to
deliver an irrevocable standby letter of credit amounting
to $15,362,000 in favor of Sumitomo.
Christopher R. Mirick, Esq., at Cadwalader, Wickersham & Taft
LLP, in New York, relates that an integral component of Houston
Refining's business is the upgrade of the heavy portion of the
crude barrel into more valuable light products like gasoline,
diesel and jet fuel. The residue remaining after the completion
of this process is petroleum coke, or "petcoke," which is a coal-
like substance that forms in the drums, and is sold to third
parties after removal from the coke drums. The production of
petcoke requires high quality and expensive coke drums, which are
custom made based on the specific size and production
requirements of the particular producer's petcoke refining
equipment, known as "cokers." Houston Refining needs to replace
Existing Drums that were installed when a 737 Unit was
constructed as part of a refinery upgrade project in 1997.
Moreover, in the ordinary course of business, Houston Refining
maintains a turnaround cycle that calls for the repair or
replacement of its coke drums at prescribed intervals, when they
reach the end of their useful life. In accordance with its
turnaround cycle, Houston Refining is scheduled to replace the
Existing Drums by the first quarter of 2012. The New Drums take
two years to manufacture and Houston Refining requires an
additional six months to prepare the New Drums for installation.
More importantly, Mr. Mirick points out, is that Houston Refining
would be forced to shut down the 737 Unit if it does not replace
the Existing Drums.
Against this backdrop, Houston Refining, with Foster Wheeler,
evaluated several potential providers of coke drums and
ultimately identified Sumitomo as the best candidate to replace
the Existing Drums. Accordingly, on March 26, 2009, Houston
Refining, Foster Wheeler and Sumitomo executed the Purchaser
Order to purchase the New Drums for $15,362,000. Houston
Refining is required to pay the aggregate purchase price to
Sumitomo in installments based upon the completion of certain
progress milestones.
Mr. Mirick stresses that it is essential to Houston Refining's
operations to maintain its existing turnaround cycle for its
coker units to ensure that it has the highest quality and fully
functional coke drums, which can process coker feedstock in a
safe and environmentally sound manner. By entering into the
Purchase Order now, Houston Refining will ensure that it replaces
the Existing Drums in an efficient and timely fashion, he notes.
While the Debtors believe that the transactions contemplated in
the Request are in the ordinary course of business, out of
abundance of caution and upon Sumitomo's request for entry of an
order, the Debtors are seeking the Court's approval of the
transactions.
In the event the purchase of the New Drums is not considered to
be in the ordinary course of Houston Refining's business, he
notes that Houston Refining is permitted by Section 363(b) of the
Bankruptcy Code to use its estate property outside of the
ordinary course of business because it has a valid business
justification for the transactions.
About Lyondell Chemical
LyondellBasell Industries is one of the world's largest polymers,
petrochemicals and fuels companies. It is the global leader in
polyolefins technology, production and marketing; a pioneer in
propylene oxide and derivatives; and a significant producer of
fuels and refined products, including biofuels. Through research
and development, LyondellBasell develops innovative materials and
technologies that deliver exceptional customer value and products
that improve quality of life for people around the world.
Headquartered in The Netherlands, LyondellBasell --
http://www.lyondellbasell.com/-- is privately owned by Access
Industries.
Basell AF and Lyondell Chemical Company merged operations in 2007
to form LyondellBasell Industries, the world's third largest
independent chemical company. LyondellBasell became saddled with
debt as part of the US$12.7 billion merger. About a year after
completing the merger, LyondellBasell Industries' U.S. operations
and one of its European holding companies -- Basell Germany
Holdings GmbH -- filed voluntary petitions to reorganize under
Chapter 11 of the U.S. Bankruptcy Code on January 6, 2009, to
facilitate a restructuring of the company's debts. The case is In
re Lyondell Chemical Company, et al., Bankr. S.D. N.Y. Lead Case
No. 09-10023). Seventy-nine Lyondell entities, including Equistar
Chemicals, LP, Lyondell Chemical Company, Millennium Chemicals
Inc., and Wyatt Industries, Inc., filed for Chapter 11. In May
2009, one of the cases was dismissed -- Case No. 09-10068 --
because it is duplicative of Case No. 09-10040 relating to Debtor
Glidden Latin America Holdings.
The Hon. Robert E. Gerber presides over the case. Deryck A.
Palmer, Esq., at Cadwalader, Wickersham & Taft LLP, in New York,
serves as the Debtors' bankruptcy counsel. Evercore Partners
serves as financial advisors, and Alix Partners and its subsidiary
AP Services LLC, serves as restructuring advisors. AlixPartners'
Kevin M. McShea acts as the Debtors' Chief Restructuring Officer.
Clifford Chance LLP serves as restructuring advisors to the
European entities. Lyondell Chemical estimated that consolidated
assets total US$27.12 billion and debts total US$19.34 billion as
of the bankruptcy filing date.
Lyondell has obtained approximately $8 billion in DIP financing to
fund continuing operations. The DIP financing includes two credit
agreements: a $6.5 billion term loan (comprising $3.25 billion in
new loans and a $3.25 billion roll-up of existing loans) and a
$1.57 billion asset-backed lending facility.
Luxembourg-based LyondellBasell Industries AF S.C.A. and another
affiliate were voluntarily added to Lyondell Chemical's
reorganization filing under Chapter 11 on April 24, 2009 in order
to seek protection against claims by certain financial and U.S.
trade creditors. On May 8, 2009, LyondellBasell Industries added
13 non-operating entities to Lyondell Chemical Company's
reorganization filing under Chapter 11 of the U.S. Bankruptcy
Code. All of the entities are U.S. companies and were added to
the original Chapter 11 filing for administrative purposes. The
filings will have no impact on current business or operations as
none of the entities manufactures or sells products.
Bankruptcy Creditors' Service, Inc., publishes Lyondell Bankruptcy
News. The newsletter tracks the Chapter 11 proceeding undertaken
by Lyondell Chemical Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
LYONDELL CHEMICAL: Court Sets June 30 as New Claims Bar Date
------------------------------------------------------------
Judge Robert E. Gerber of the United States Bankruptcy Court for
the Southern District of New York amended his prior order and set
June 30, 2009, as the new deadline by which each person or entity
that asserts a claim against Lyondell Chemical Company and its 92
debtor-affiliates will file an original, written proof of claim.
Moreover, governmental units must file proofs of claim under
Section 502(b)(9) of the Bankruptcy Code against the Debtors on:
(i) July 6, 2009, with respect to all Debtors whose Petition
Date is January 6, 2009;
(ii) October 21, 2009, with respect to all Debtors whose
Petition Date is April 24, 2009; or
(iii) November 4, 2009, with respect to all Debtors whose
Petition Date is May 8, 2009.
LyondellBasell Industries is one of the world's largest polymers,
petrochemicals and fuels companies. It is the global leader in
polyolefins technology, production and marketing; a pioneer in
propylene oxide and derivatives; and a significant producer of
fuels and refined products, including biofuels. Through research
and development, LyondellBasell develops innovative materials and
technologies that deliver exceptional customer value and products
that improve quality of life for people around the world.
Headquartered in The Netherlands, LyondellBasell --
http://www.lyondellbasell.com/-- is privately owned by Access
Industries.
Basell AF and Lyondell Chemical Company merged operations in 2007
to form LyondellBasell Industries, the world's third largest
independent chemical company. LyondellBasell became saddled with
debt as part of the US$12.7 billion merger. About a year after
completing the merger, LyondellBasell Industries' U.S. operations
and one of its European holding companies -- Basell Germany
Holdings GmbH -- filed voluntary petitions to reorganize under
Chapter 11 of the U.S. Bankruptcy Code on January 6, 2009, to
facilitate a restructuring of the company's debts. The case is In
re Lyondell Chemical Company, et al., Bankr. S.D. N.Y. Lead Case
No. 09-10023). Seventy-nine Lyondell entities, including Equistar
Chemicals, LP, Lyondell Chemical Company, Millennium Chemicals
Inc., and Wyatt Industries, Inc., filed for Chapter 11. In May
2009, one of the cases was dismissed -- Case No. 09-10068 --
because it is duplicative of Case No. 09-10040 relating to Debtor
Glidden Latin America Holdings.
The Hon. Robert E. Gerber presides over the case. Deryck A.
Palmer, Esq., at Cadwalader, Wickersham & Taft LLP, in New York,
serves as the Debtors' bankruptcy counsel. Evercore Partners
serves as financial advisors, and Alix Partners and its subsidiary
AP Services LLC, serves as restructuring advisors. AlixPartners'
Kevin M. McShea acts as the Debtors' Chief Restructuring Officer.
Clifford Chance LLP serves as restructuring advisors to the
European entities. Lyondell Chemical estimated that consolidated
assets total US$27.12 billion and debts total US$19.34 billion as
of the bankruptcy filing date.
Lyondell has obtained approximately $8 billion in DIP financing to
fund continuing operations. The DIP financing includes two credit
agreements: a $6.5 billion term loan (comprising $3.25 billion in
new loans and a $3.25 billion roll-up of existing loans) and a
$1.57 billion asset-backed lending facility.
Luxembourg-based LyondellBasell Industries AF S.C.A. and another
affiliate were voluntarily added to Lyondell Chemical's
reorganization filing under Chapter 11 on April 24, 2009 in order
to seek protection against claims by certain financial and U.S.
trade creditors. On May 8, 2009, LyondellBasell Industries added
13 non-operating entities to Lyondell Chemical Company's
reorganization filing under Chapter 11 of the U.S. Bankruptcy
Code. All of the entities are U.S. companies and were added to
the original Chapter 11 filing for administrative purposes. The
filings will have no impact on current business or operations as
none of the entities manufactures or sells products.
Bankruptcy Creditors' Service, Inc., publishes Lyondell Bankruptcy
News. The newsletter tracks the Chapter 11 proceeding undertaken
by Lyondell Chemical Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
LYONDELL CHEMICAL: LBI & GP Units File Schedules & Statements
-------------------------------------------------------------
LyondellBasell Industries AF S.C.A., disclosed in its Schedules of
Assets and Liabilities that it does not own any real property and
its assets total $32,036, comprising of personal property. Its
total scheduled liabilities reached $18,784,453,947, majority of
which are secured claims of banks.
In the company's statement of Financial Affairs, Alan S. Bigman,
chief financial officer of Lyondell Chemical Company, disclosed
that LyondellBasell Industries AF S.C.A. has made payments
aggregating $3,074,795 to creditors within 90 days before the
Petition Date. Moreover, LBI has paid certain insiders an
aggregate of $990,762 within 90 days before the Petition Date.
LBI has also paid certain professionals for debt counseling or
bankruptcy-related services rendered within one year before the
Petition Date:
Firm Amount
---- ------
AP Services, LLP $3,272,994
Cadwalader, Wickersham, Taft LLP 12,181,904
Evercore Partners 1,125,000
-----------
Total $16,579,898
LBI's current officers and directors are:
Name Position
---- ---------
A. De Vries Manager
Alan S. Bigman Manager
Bart De Jong Manager
Cees Los Manager
Ed Dineen Manager
Ian Dunn Manager
Volker Trautz Manager
In a separate filing, Mr. Bigman notes that LBI made intercompany
payments a year before the Petition Date aggregating $28,495,078,
a full-text copy of which is available for free at:
http://bankrupt.com/misc/LBI_IntercompanyPayments.pdf
On the other hand, LyondellBasell AFGP S.a.r.l. disclosed total
scheduled assets of $15,031 and $0 liabilities. Mr. Bigman
relates that LyondellBasell AFGP S.a.r.l was a defendant to an
aiding & abetting breach of fiduciary duty proceeding in the
Chancery Court in Newcastle County, Delaware. GP's current
officers and directors are:
Name Position
---- ---------
A. De Vries Manager
Alan S. Bigman Manager
Bart De Jong Manager
Cees Los Manager
Ed Dineen Manager
Ian Dunn Manager
Phillip Kassin Manager
Volker Trautz Manager
Mr. Bigman disclosed in a separate filing that GP made
intercompany payments a year before the Petition Date aggregating
$69 to Basell Service Company BV.
About Lyondell Chemical
LyondellBasell Industries is one of the world's largest polymers,
petrochemicals and fuels companies. It is the global leader in
polyolefins technology, production and marketing; a pioneer in
propylene oxide and derivatives; and a significant producer of
fuels and refined products, including biofuels. Through research
and development, LyondellBasell develops innovative materials and
technologies that deliver exceptional customer value and products
that improve quality of life for people around the world.
Headquartered in The Netherlands, LyondellBasell --
http://www.lyondellbasell.com/-- is privately owned by Access
Industries.
Basell AF and Lyondell Chemical Company merged operations in 2007
to form LyondellBasell Industries, the world's third largest
independent chemical company. LyondellBasell became saddled with
debt as part of the US$12.7 billion merger. About a year after
completing the merger, LyondellBasell Industries' U.S. operations
and one of its European holding companies -- Basell Germany
Holdings GmbH -- filed voluntary petitions to reorganize under
Chapter 11 of the U.S. Bankruptcy Code on January 6, 2009, to
facilitate a restructuring of the company's debts. The case is In
re Lyondell Chemical Company, et al., Bankr. S.D. N.Y. Lead Case
No. 09-10023). Seventy-nine Lyondell entities, including Equistar
Chemicals, LP, Lyondell Chemical Company, Millennium Chemicals
Inc., and Wyatt Industries, Inc., filed for Chapter 11. In May
2009, one of the cases was dismissed -- Case No. 09-10068 --
because it is duplicative of Case No. 09-10040 relating to Debtor
Glidden Latin America Holdings.
The Hon. Robert E. Gerber presides over the case. Deryck A.
Palmer, Esq., at Cadwalader, Wickersham & Taft LLP, in New York,
serves as the Debtors' bankruptcy counsel. Evercore Partners
serves as financial advisors, and Alix Partners and its subsidiary
AP Services LLC, serves as restructuring advisors. AlixPartners'
Kevin M. McShea acts as the Debtors' Chief Restructuring Officer.
Clifford Chance LLP serves as restructuring advisors to the
European entities. Lyondell Chemical estimated that consolidated
assets total US$27.12 billion and debts total US$19.34 billion as
of the bankruptcy filing date.
Lyondell has obtained approximately $8 billion in DIP financing to
fund continuing operations. The DIP financing includes two credit
agreements: a $6.5 billion term loan (comprising $3.25 billion in
new loans and a $3.25 billion roll-up of existing loans) and a
$1.57 billion asset-backed lending facility.
Luxembourg-based LyondellBasell Industries AF S.C.A. and another
affiliate were voluntarily added to Lyondell Chemical's
reorganization filing under Chapter 11 on April 24, 2009 in order
to seek protection against claims by certain financial and U.S.
trade creditors. On May 8, 2009, LyondellBasell Industries added
13 non-operating entities to Lyondell Chemical Company's
reorganization filing under Chapter 11 of the U.S. Bankruptcy
Code. All of the entities are U.S. companies and were added to
the original Chapter 11 filing for administrative purposes. The
filings will have no impact on current business or operations as
none of the entities manufactures or sells products.
Bankruptcy Creditors' Service, Inc., publishes Lyondell Bankruptcy
News. The newsletter tracks the Chapter 11 proceeding undertaken
by Lyondell Chemical Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
MACY'S INC: Toy R Us Acquires FAO Schwarz & Will Close 260 Outlets
------------------------------------------------------------------
Macy's Inc. spokesperson Jim Sluzewski said that the Company is
disappointed that Toys "R" Us is terminating a program to operate
FAO Schwarz's outlets in hundreds of Macy's stores, Karen Talley
at Dow Jones Newswires relates.
Toys "R" Us, Inc., has acquired FAO Schwarz. Jerry Storch,
Chairman and CEO, Toys "R" Us, Inc., said, "We will work
tirelessly to preserve the distinctiveness and integrity of the
FAO Schwarz stores and brand as we grow the business and, indeed,
take the brand to even greater heights."
Dow Jones states that FAO Schwarz operates in 260 Macy's stores
and will be closing these outlets before the important holiday
shopping season. Citing Mr. Sluzewski, Dow Jones says that plans
to outfit another 400 Macy's stores are ruined. Dow Jones notes
that other inventory will be put in the locations when retailers
are having a hard time moving what they already have.
Following the acquisition, Toys "R" Us will continue to operate
two FAO Schwarz retail stores -- the flagship location in New York
City and a store at the Forum Shops at Caesars Palace in Las
Vegas. In addition, the company will operate the FAO Schwarz
e-commerce and catalog operations. Each of these businesses will
continue to operate under the legendary FAO Schwarz name. All
merchandising, management, distribution and marketing operations
will immediately begin to transition to Toys "R" Us, Inc. Other
terms of the transaction were not disclosed.
"This acquisition allows us to grow our toy specialist market
share and draw upon the unique strengths of both brands in
developing quality products that differentiate us from our mass
market competitors," Mr. Storch stated. "To that end, we look
forward to working together with the expanded universe of
respected FAO Schwarz manufacturers and other valued partners,
while developing innovative and quality product offerings. We are
committed to providing the loyal clientele of FAO Schwarz with the
unique shopping experience they have come to expect."
Toys "R" Us will offer employment opportunities to FAO Schwarz
associates in the New York and Las Vegas stores.
Toys "R" Us currently operates stores in 33 countries worldwide,
offering its customers a differentiated merchandise assortment and
a first-to-market experience with the hottest new toys. The
acquisition of FAO Schwarz further advances the company's toy
authority position and broadens its growing portfolio of family-
friendly brands. Earlier this year, Toys "R" Us expanded its
online brand offerings through the acquisition of the highly
regarded eToys.com, babyuniverse.com, Toys.com, and parenting
resource site, ePregnancy.com.
Based in Cincinnati and New York, Macy's Inc. (NYSE: M) fka
Federated Department Stores Inc. -- http://www.fds.com/-- is one
of the nation's premier retailers. The Company operates more than
850 department stores in 45 states, the District of Columbia, Guam
and Puerto Rico under the names of Macy's and Bloomingdale's. The
Company also operates macys.com, bloomingdales.com and
Bloomingdale's By Mail.
As of May 2, 2009, the Company reported $21,331,000,000 in total
assets, $4,397,000,000 in total current debt, $8,719,000,000 in
long-term debt, and $4,555,000,000 shareholders' equity.
* * *
As reported by the Troubled Company Reporter on April 3, 2009,
Moody's Investors Service downgraded Macy's, Inc.'s ratings,
including the senior unsecured notes to Ba2 from Baa3. In
addition, Moody's assigned a Corporate Family Rating of Ba2, a
Probability of Default Rating of Ba2, and a Speculative Grade
Liquidity Rating of SGL-2. The rating outlook is stable.
MAHALO ENERGY: Files for CCAA Protection
----------------------------------------
Mahalo Energy Ltd. has obtained an order from the Court of Queen's
Bench of Alberta, Judicial District of Calgary for protection
under the Companies' Creditors Arrangement Act (Canada). Alger &
Associates Inc. was appointed monitor under the order. Subject to
the order, proceedings by creditors and others cannot be continued
or commenced without the consent of Mahalo and the monitor, or
leave of the court. A copy of the order will be made available on
the monitor's Web site.
As previously announced, management of the Company has been
exploring strategic alternatives since the fall of 2008 and has
had discussions with a number of interested parties. To date, no
satisfactory offers or proposals have been made and management has
concluded that no transaction is likely to take place in the
immediate future.
The order permits Mahalo to remain in possession and control of
its property, carry on its business and retain employees while the
Company continues its previously announced process to evaluate
strategic alternatives available to the Company, including the
sale of Mahalo or its assets.
Mahalo is a junior, unconventional natural gas company, focusing
on the development and production of coal bed methane and shale
gas prospects in the United States.
MAHALO USA: Files for Chapter 11 Bankruptcy Protection
------------------------------------------------------
Mahalo Energy Ltd. reported that its wholly owned subsidiary
Mahalo Energy (USA) Inc., a corporation organized under the laws
of the State of Delaware is filing for Chapter 11 bankruptcy
protection under the United States Bankruptcy Code.
As previously announced, management of the Company has been
exploring strategic alternatives since the fall of 2008 and has
had discussions with a number of interested parties. To date, no
satisfactory offers or proposals have been made and management has
concluded that no transaction is likely to take place in the
immediate future.
The Company also entered into a financing commitment with Ableco
Finance, LLC for debtor-in-possession financing totaling
approximately $2 million for its U.S. subsidiary. These
arrangements are subject to customary approval of the Courts in
the United States and will allow the Company to meet current
operating needs, including wages, benefits and other operating
expenses.
Mahalo Energy Ltd. has obtained an order from the Court of Queen's
Bench of Alberta, Judicial District of Calgary for protection
under the Companies' Creditors Arrangement Act (Canada). Alger &
Associates Inc. was appointed monitor under the order.
Mahalo is a junior, unconventional natural gas company, focusing
on the development and production of coal bed methane and shale
gas prospects in the United States.
MERUELO MADDUX: Bofa Objects to Compensation Plan for Executives
----------------------------------------------------------------
Bank of America NA has objected to Meruelo Maddux Properties,
Inc.'s proposal to increase compensation for seven executives.
Bofa said that:
-- the compensation requested bears no relation to the
Debtors' weakened current condition; and
-- the Debtors are operating at a $23 million net loss and
cannot pay the costs of their operations or administration.
The 7 executives and the proposed compensation for each are:
Name Compensation Amount
------------------------- --------------------------------
Miguel Enrique Echemendia $345,850 plus stock compensation
of $953 ($277,530 annual
salary).
John Maddux $697,350 plus stock compensation
of $350 ($450,000 annual
salary).
Lynn Beckemeyer $345,850 plus stock compensation
of $749 ($275,000 annual
salary).
Andrew Murray $497,904 plus stock compensation
of $2,100 ($275,000 annual
salary).
Todd Nielsen $345,850 plus stock compensation
of $953 ($275,000 annual
salary).
Fred Skaggs $345,850 plus stock compensation
of $585 ($275,000 annual
salary).
Richard Meruelo $695,000 plus stock compensation
of $350 ($450,000 annual
salary).
Total $2,873,654
BofA adds that the Debtors are not paying any debt service and are
not paying the property taxes on their properties.
If the Court does not deem it appropriate to reduce the amount of
the executives' compensation, BofA requests that the Court prevent
the Debtors from at least distributing the $250,000 bonuses of
Messrs. Meruelo and Maddux and that the Court prevent the Debtors
from enhancing the salaries of Messrs. Echemendia, Beckemeyer,
Nielsen, and Skaggs.
About Meruelo Maddux
Based in Los Angeles, California, Meruelo Maddux Properties, Inc.,
-- http://www.meruelomaddux.com/-- together with its affiliates,
engage in residential, commercial and industrial development.
Meruelo Maddux and its affiliates filed for Chapter 11 protection
on March 26, 2009 (Bankr. C. D. Calif. Lead Case No. 09-13356).
Aaron De Leest, Esq., John J. Bingham, Jr., Esq., and John N.
Tedford, Esq., at Danning Gill Diamond & Kollitz, represent the
Debtors in their restructuring efforts. Peter C. Anderson, the
United States Trustee for Region 16, appointed five creditors to
serve on the Creditors Committee. Asa S. Hami, Esq., Tamar
Kouyoumjian, Esq., and Victor A. Sahn, Esq., at SulmeyerKupetz, A
Professional Corporation, represent the Creditors Committee as
counsel. The Debtors' financial condition as of December 31,
2008, showed estimated assets of $681,769,000 and estimated debts
of $342,022,000.
METALDYNE CORP: S&P Downgrades Corporate Credit Rating to 'D'
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Plymouth, Michigan-based Metaldyne Corp. to 'D' and
lowered various issue-level ratings.
The rating actions were prompted by Metaldyne filing for
Chapter 11 bankruptcy protection on May 28, 2009, in New York.
Deutsche Bank AG has agreed to provide an $18.5 million debtor-in-
possession financing facility. Some of Metaldyne's customers are
expected to participate in the financing. The company has entered
into two nonbinding letters of intent to sell the majority of its
assets. Two private equity firms have submitted letters of intent
to purchase different portions of the company's assets.
"We believe the filing was prompted by the company's heavy debt
burden and a sharp decline in liquidity caused by severe
automotive production declines in the North America and
elsewhere," Standard & Poor's credit analyst Robert Schulz said.
Pending further information from the bankruptcy proceedings, the
recovery ratings remain unchanged.
METALDYNE CORP: Wants Jones Day as Bankruptcy Counsel
-----------------------------------------------------
Metaldyne Corporation and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Southern District of New York for
permission to employ Jones Day as their counsel.
Jones Day will, among other things:
-- advise the Debtors of their rights, powers and duties as
debtors and debtors-in-possession continuing to operate and
manage their businesses and properties under Chapter 11;
-- prepare on behalf of the Debtors all necessary and
appropriate applications, motions, proposed orders, other
pleadings, notices, schedules and other documents, and
review all financial and other reports to be filed in the
Chapter 11 cases; and
-- advise the Debtors concerning, and prepare responses to,
applications, motions, other pleadings, notices and other
papers that may be filed by other parties in the Chapter 11
cases.
The Debtors also applied to retain Foley & Lardner LLP as
conflicts and special counsel. The Debtors relate that both firms
will not duplicate the services they provide the Debtors.
Pre-bankruptcy, Jones Day received a $450,000 advanced payment for
legal services rendered. The Debtors replenished and maintained
the 2008 Deposit. The sources of the 2008 Deposit were the
Debtors' operating cash.
Heather Lennox, a partner at Jones Day, tells the Court that the
firm intends to charge for its legal services on an hourly basis.
The firm will charge different rates from Feb. 1, 2009, through
September 30, 2009; and from Oct. 1, 2009, through the conclusion
of the Chapter 11 cases.
The hourly rates of the firm's personnel are:
Rate Feb. 1 to
Name September 30 Rate from Oct. 1
---- -------------- ----------------
Corrine Ball, partner $875 $900
Brett Barragate, partner $625 $700
Rosalind Connor, partner GBP500 GBP500
Adam Plainer, partner GBP575 GBP600
John Cornel, partner $850 $950
Heather Lennox, partner $700 $725
Mark Cody, partner $600 $650
Bradley Brasser, associate $450 $475
Jason Cover, associate $350 $425
Ryan Routh, associate $450 $500
Daniel Syphard, associate $250 $325
Joseph Tiller, associate $300 $375
Thomas Wilson, associate $325 $400
Mary Hermann, paralegal $175 $200
Denise Hirtzel, paralegal $250 $275
Betty Yakovich, paralegal $200 $225
Ms. Lennox assures the Court that Jones Day is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.
Ms. Lennox can be reached at:
Jones Day
222 East 41st Street
New York, New York 10017
Tel: (212) 326-7839
Fax: (212) 755-7306
About Metaldyne Corporation
Headquartered in Plymouth, Michigan, Metaldyne Corporation --
http://www.metaldyne.com-- is a wholly owned subsidiary of Asahi
Tec, a Shizuoka, Japanbased chassis and powertrain component
supplier in the passenger car/light truck and medium/heavy truck
segments. Asahi Tec is listed on the Tokyo Stock Exchange.
Metaldyne is a leading global designer and supplier of metal based
components, assemblies and modules for transportation related
powertrain and chassis applications including engine,
transmission/transfer case, wheel end, and suspension, axle and
driveline, and noise and vibration control products to the motor
vehicle industry.
On Jan. 11,2007, in connection with a plan of merger, Asahi Tee
Corporation in Japan acquired the shares of Metaldyne. On the
same date, Asahi Tee contributed those shares to Metaldyne
Holdings, and Asahi Tee thereby became the indirect parent of
Metaldyne and its other units. RHJ International S.A. of Belgium
now holds approximately 60.1% of the outstanding capital stock of
Asahi Tec.
The company own 23 different properties, including 14 domestic
manufacturing facilities in six states, and more than 10
manufacturing facilities North America, Europe, South America and
Asia.
For the fiscal year ended March 29,2009, the company recorded
annual revenue of approximately $1.32 billion. As of March 29,
2009, utilizing book values, the company had assets of
approximately $977 million and liabilities of $927 million.
Metaldyne Corporation aka MascoTech, Inc. aka MascoTech Harbor,
Inc., Riverside Acquisition Corporation and Metaldyne Subsidiary
Inc. and its affiliates filed for Chapter 11 protection on May 27,
2009 (Bankr. S. D. NY Lead Case No. 09-13412). The Debtors
propose to hire Judy A. O'Neill, Esq., at Foley & Lardner LLP as
conflicts counsel; Lazard Freres & Co. LLC and AlixPartners LLP as
financial advisors; and BMC Group Inc. as claims agent. As of
March 29, 2009, utilizing book values, the company had assets of
approximately $977 million and liabilities of $927 million.
METALDYNE CORP: Wants Schedules Filing Extended Until July 13
-------------------------------------------------------------
Metaldyne Corporation and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Southern District of New York to extend
until July 13, 2009, the time to file their: (a) schedules of
assets and liabilities, (b) schedules of executory contracts and
unexpired leases; (c) statements of financial affairs; and (d)list
of physical inventory.
The Debtors said they need more time to collect, review and
assemble a substantial amount of information to complete their
schedules.
Headquartered in Plymouth, Michigan, Metaldyne Corporation --
http://www.metaldyne.com-- is a wholly owned subsidiary of Asahi
Tec, a Shizuoka, Japanbased chassis and powertrain component
supplier in the passenger car/light truck and medium/heavy truck
segments. Asahi Tec is listed on the Tokyo Stock Exchange.
Metaldyne is a leading global designer and supplier of metal based
components, assemblies and modules for transportation related
powertrain and chassis applications including engine,
transmission/transfer case, wheel end, and suspension, axle and
driveline, and noise and vibration control products to the motor
vehicle industry.
On Jan. 11,2007, in connection with a plan of merger, Asahi Tee
Corporation in Japan acquired the shares of Metaldyne. On the
same date, Asahi Tee contributed those shares to Metaldyne
Holdings, and Asahi Tee thereby became the indirect parent of
Metaldyne and its other units. RHJ International S.A. of Belgium
now holds approximately 60.1% of the outstanding capital stock of
Asahi Tec.
The company own 23 different properties, including 14 domestic
manufacturing facilities in six states, and more than 10
manufacturing facilities North America, Europe, South America and
Asia.
For the fiscal year ended March 29,2009, the company recorded
annual revenue of approximately $1.32 billion. As of March 29,
2009, utilizing book values, the company had assets of
approximately $977 million and liabilities of $927 million.
Metaldyne Corporation aka MascoTech, Inc., aka MascoTech Harbor,
Inc., Riverside Acquisition Corporation and Metaldyne Subsidiary
Inc. and its affiliates filed for Chapter 11 on May 27, 2009
(Bankr. S. D. NY Lead Case No. 09-13412). Richard H. Engman,
Esq., at Jones Day represents the Debtors in their restructuring
efforts. The Debtors propose to hire Judy A. O'Neill, Esq. at
Foley & Lardner LLP as conflicts counsel; Lazard Freres & Co. LLC
and AlixPartners LLP as financial advisors; and BMC Group Inc. as
claims agent. As of March 29, 2009, utilizing book values, the
company had assets of approximately $977 million and liabilities
of $927 million.
MIDWAY GAMES: Discloses Timeframe for Section 363 Sale Process
--------------------------------------------------------------
Midway Games Inc. has established the timeline for the expected
sale of the Company's assets to the highest bidders in accordance
with the sale and bid procedures motion filed with the Bankruptcy
Court pursuant to Section 363 of the U.S. Bankruptcy Code.
Midway recently announced a "stalking horse" asset purchase
agreement, which is expected to receive court approval, subject to
higher or better bids, in a hearing on June 2, 2009. Following
this hearing, there will be a period during which Midway, through
its financial advisor, Lazard, will accept binding offers up to
June 24, 2009, to acquire some or all of the Company's assets. An
auction will be held on June 29 to determine the bid or
combination of bids that achieves the highest value, followed by a
court hearing to approve the sale to the winning bidder or bidders
on July 1st, and then a final closing. All bids must comply with
the bid procedures order to be issued at the hearing on June 2,
2009.
The "stalking horse" asset purchase agreement includes a
significant portion of Midway's assets, however not all of the
assets were included in the agreement. The bidding process allows
for interested parties to bid on sets of assets including those
not in the agreement, and multiple bidders can be formed into a
group whose bids in the aggregate constitute a greater value than
the initial stalking horse bid. Successful bidders will be buying
only Midway's assets, and will not assume nor be responsible for
any of the company's debt or liabilities, including any secured or
unsecured notes, credit facilities, or trade obligations.
Midway's considerable intellectual property assets span some of
the most successful sectors in the video game industry. Midway is
well known for fighting games, with its more than $1.5 billion
franchise, Mortal Kombat, as well as the video game license for
the fastest-growing wrestling league, Total Nonstop Action (TNA)
Wrestling. Midway's development teams are known worldwide for
their expertise in fighting game mechanics, motion-capture
integration, and AAA production values.
Midway also has strong capabilities in open-world games, including
the highly-detailed action-adventure game currently in
development, This is Vegas, and the recently released open-world
driving game, Wheelman. The development barriers to entry in this
genre are considerable, and Midway has an engine in place and
expertise to create high-quality, expansive open-world games.
Midway has a long legacy of arcade-style casual and classic
intellectual property, with 50 years of popular arcade classics
such as Spy Hunter, Rampage, Joust, Paperboy, Gauntlet, and many
more. This, coupled with Midway's recent blockbuster success with
the three-million-plus unit selling franchise Game Party and the
1.5 million unit selling TouchMaster franchise, comprises a full
line of casual and family games. There are a number of games
currently in production for a wide variety of platforms including
Nintendo DS/DSi and Wii, Xbox 360 Live Arcade, Apple iPhone, Sony
PSP and PS3, and online.
Qualified interested parties should review the asset purchase
agreement and bidding procedures filed with the court, and contact
Midway or Lazard's Kayvon Bina at Kayvon.Bina@lazard.com, as soon
as possible for more information on Midway's assets and how to
place a bid.
About Midway Games
Midway Games Inc. (OTC Pink Sheets: MWYGQ), headquartered in
Chicago, Illinois, with offices throughout the world, is a leading
developer and publisher of interactive entertainment software for
major videogame systems and personal computers. More information
about Midway and its products can be found at
http://www.midway.com/
The Company and nine of its affiliates filed for Chapter 11
protection on February 12, 2009 (Bankr. D. Del. Lead Case No.
09-10465). David W. Carickhoff, Jr., Esq., Michael David
Debaecke, Esq., and Victoria A. Guilfoyle, Esq., at Blank Rome
LLP, represent the Debtors in their restructuring efforts. The
Debtors proposed Lazard as their investment banker, Dewey &
LeBoeuf LLP as special counsel, and Epiq Bankruptcy Solutions LLC
as claims agent.
MOMENTIVE PERFORMANCE: Reports $515 Million Old Notes Tendered
--------------------------------------------------------------
Momentive Performance Materials Inc. reported that, as of May 26,
2009, approximately $515 million in aggregate principal amount of
the outstanding Momentive old notes had been properly tendered and
not withdrawn, which consists of (i) approximately $347 million in
aggregate principal amount of the outstanding Momentive old senior
notes and (ii) $168 million in aggregate principal amount of the
outstanding Momentive old subordinated notes.
To recall, the company wanted to exchange a new series of 12 1/2%
second-lien senior secured notes due 2014 for certain of its
outstanding notes.
The company related that, as a result, whether or not additional
old notes are tendered, it expects that it will issue the full
amount of the $200 million aggregate principal amount of new
second lien notes in exchange for tendered old notes. However,
additional tenders of old notes may be accepted pursuant to the
modified Dutch auction process described in a confidential
offering memorandum delivered to eligible holders in connection
with the exchange offers depending on the indicative offer prices
at which such additional tenders are made, the company said.
The exchange offers will expire on Tuesday, June 9, 2009, at
midnight, New York City time, unless terminated or withdrawn
earlier, or unless extended by Momentive. In accordance with the
terms of the exchange offers, the withdrawal deadline relating to
the exchange offers occurred at 5:00 p.m., New York City time, on
Tuesday, May 26, 2009. Thus, tendered old notes may no longer be
withdrawn.
About Momentive Performance
Momentive Performance Materials Inc. is a producer of silicones
and silicone derivatives, and is engaged in the development and
manufacture of products derived from quartz and specialty
ceramics. As of December 31, 2008, the Company had 25 production
sites located worldwide, which allows it to produce the majority
of its products locally in the Americas, Europe and Asia.
Momentive's customers include companies in industries, such as
Procter & Gamble, 3M, Goodyear, Unilever, Saint Gobain, Motorola,
L'Oreal, BASF, The Home Depot and Lowe's.
Standard & Poor's Ratings Services said mid-March 2009 it lowered
its ratings on Momentive Performance Inc. and its subsidiaries by
two notches, including its corporate credit rating to 'CCC' from
'B-' and placed them on CreditWatch with negative implications.
According to S&P, these rating actions reflect a near-term risk of
default. They follow a sharp decline in earnings and cash flow
during the fourth quarter of 2008 and management's projection of
extremely weak EBITDA of $5 million to $15 million in the first
quarter of 2009.
NASH FINCH: S&P Raises Corporate Credit Rating to 'BB-'
-------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Nash Finch Co. to 'BB-' from 'B+'. At the same time,
S&P raised the issue-level rating on the company's senior
subordinated notes to 'B' from B-'. The rating outlook is stable.
"The ratings upgrade reflects our expectation for continued
progress in improving operations and enhanced credit protection
metrics over the near term," said Standard & Poor's credit analyst
David Kuntz. "While S&P believes operating margins may fall
slightly in the near term due to the company's acquisition of GSC
and the subsequent shift in segment revenue mix, S&P believes the
transaction will ultimately benefit Nash Finch over the medium
term."
The 'BB-' rating reflects Nash Finch's relatively small scale in
the highly competitive food wholesaling and supermarket
industries, and challenges at its retail segment. These risks are
somewhat offset by its good market position in the military
distribution industry.
The food distribution and military segments continue to fare well,
but the retail segment remains pressured. S&P anticipate that
these trends are likely to continue in the near term, with minor
gains at food distribution, small losses at retail, and a large
increase in military revenues due to the GSC acquisition. S&P
expects further margin reductions as the military distribution
segment becomes a larger portion of the business over the near
term, but that enhanced operational efficiencies and good cost
containment is likely to boost margins over the medium term. For
the quarter ended March 28, 2009, food distribution revenues
increased 1.3% year over year due to new account gains, military
sales grew by 46.4% due to the acquisition of GSC, and retail
revenues fell by 1.8% primarily due to negative same-store sales
of 2.3%.
Credit metrics have demonstrated incremental improvement over the
past year and remain above average for the current rating. S&P
anticipates that leverage may increase slightly to the mid-2.0x
area over the near term due to the increased debt and margin
pressure associated with the GSC acquisition. S&P expects
interest coverage to remain generally in line with current levels,
at 5.5x over the near term. However, S&P believes that the
company is likely to enhance its credit protection metrics over
the medium term once margins begin to recover and the company is
able to repay some of the debt associated with the GSC
transaction.
NEVIS NETWORKS: Files for Chapter 7 Bankruptcy Protection
---------------------------------------------------------
Timothy Hay posted on The Wall Street Journal blog that Nevis
Networks Inc. has filed for Chapter 7 bankruptcy protection.
According to Mr. Hay, Nevis was faced with slower-than-expected
adoption by information technology professionals, as well as
competition from big companies like Microsoft Corp. and Cisco
Systems Inc.
Court documents say that Nevis had up to $500,000 in assets and up
to $50 million in debts owed to as many as 49 creditors. Nevis
"has sold all its assets and operations to a new company. The new
company will be making this announcement shortly," VentureWire
quoted Tushar Dave, a NewPath co-founder who held a board seat at
Nevis, as saying.
Based in Mountain View, California, Nevis Networks Inc. was
launched in 2002. It had 165 employees and more than $32 million
in backing from some of the venture industry's top firms: BlueRun
Ventures, New Enterprise Associates, and NewPath Ventures.
NM HOLDINGS: Trustee's Suit Against Deloitte is Dismissed
---------------------------------------------------------
NM Holdings Company, LLC, fka Venture Holdings Company, LLC, filed
for Chapter 11 protection on March 23, 2003 (Bankr. E.D. Mich.
Case No. 03-48939), and the two-year statute of limitation for
prosecution of avoidance actions under 11 U.S.C. Sec. 546(a)(1)(A)
passed without the debtor-in-possession taking any action.
The Bankruptcy Court denied confirmation of Venture's second
amended joint Chapter 11 plan, on January 21, 2005, and later
approved the sale of substantially all of Venture's assets. The
sale closed on May 2, 2005. On January 11, 2006, the Chapter 11
cases were converted to Chapter 7. Stuart A. Gold was appointed
the Chapter 7 Trustee on January 19, 2006.
Following his appointment, Mr. Gold sued Deloitte & Touche, LLP
(Bankr. E.D. Mich. Adv. Pro. No. 06-4615) for professional
negligence, aiding and abetting breach of fiduciary duty,
disgorgement of fees, and fraudulent transfers. Deloitte moved to
dismiss.
In a published decision, --- B.R. ----, 2008 WL 4602263, 50 Bankr.
Ct. December 219, the Honorable Thomas J. Tucker concludes that
Deloitte's motion to dismiss should be granted as to all counts,
because: (1) Mr. Gold's claims for aiding and abetting breach of
fiduciary duty, and for avoidance of fraudulent transfers are
barred by the applicable statutes of limitations; (2) Mr. Gold's
claim for disgorgement of fees is not a separate cause of action,
but rather is only a possible remedy for the trustee's other
claims; and (3) Mr. Gold cannot establish the causation element of
his professional negligence claim.
NOBLE INTERNATIONAL: Names McCracken as CEO After Tavi Resigns
--------------------------------------------------------------
On May 21, 2009, Andrew J. Tavi informed the Board of Directors of
Noble International, Ltd., that, effective June 1, 2009, he is
resigning as Chief Executive Officer, General Counsel and
Secretary of the Company to take another position of employment.
On May 22, 2009, the Board appointed Richard P. McCracken, 61, to
serve as Chief Executive Officer upon the effectiveness of Mr.
Tavi?s resignation. Mr. McCracken is, and will continue to serve
as, a director and the Chairman of the Board. He will receive an
annual salary of $400,000 but will not receive any additional fees
as a member of the Board.
Mr. McCracken has served as a director and the Chairman of the
Board since 2008. He has been a private consultant specializing in
divestitures, acquisitions and operating efficiencies since 2004.
From 2000 until 2004 Mr. McCracken served as Alcoa?s vice
president of finance in the packaging, consumer and distribution
group. He also served as a director of Integris Metals, a business
venture between Alcoa?s and BHP Billiton?s metal distribution
companies. During his tenure as vice president of Finance at
Alcoa, Mr. McCracken provided financial, IT and strategic
leadership and direction to seven business units with an excess of
100 operating locations, average revenues over $4 billion and cash
flow in excess of $300 million.
Headquartered in Warren, Michigan, Noble International, Ltd. --
http://www.nobleintl.com/home.html/-- provides flat, tubular,
shaped and enclosed formed structures to automotive original
equipment manufacturers and their suppliers, for use in automobile
applications, including doors, fenders, body side panels, pillars,
bumpers, door beams, load floors, windshield headers, door tracks,
door frames, and glass channels.
Noble International and its affiliates filed for Chapter 11
protection on April 15, 2009 (Bankr. E. D. Mich. Case No.
09-51720). David G. Dragich, Esq., and Judy A. O'Neill, Esq., at
Harrington Dragich O'Neill; Jennifer Hayes, Esq., and Ryan S.
Bewersdorf, Esq., at Foley & Lardner LLP, represent the Debtors as
counsel. Daniel M. McDermott, the United States Trustee for
Region 9, appointed three creditors to serve on an official
committee of unsecured creditors. Eric David Novetsky, Esq., Jay
L. Welford, Esq., Judith Greenstone Miller, Esq., Paul R. Hage,
Esq., and Richard E. Kruger, Esq., at Jaffe Raitt Heuer & Weiss,
represent the creditors committee as counsel. The Debtors
disclosed total assets of $190,763,000 and total debts of
$38,691,000, as of January 10, 2009.
NOVASTAR FINANCIAL: Deloitte Raises Going Concern Doubt
-------------------------------------------------------
Deloitte and Touche LLP in Kansas City, Missouri, expressed
substantial doubt in NovaStar Financial Inc.'s ability to continue
as going concern after auditing its consolidated balance sheets
the years ended 2008 and 2007, due to the Company's recurring
losses, negative cash flows, shareholders' deficit and lack of
significant operations.
The Company's consolidated balance sheets showed $1.97 billion in
total assets and $2.85 billion in total liabilities resulting in
an $880 million stockholders' deficit for the year ended
December 31, 2008.
The company reported a $660 million net loss for the year ended
December 31, 2008, compared to $724 million net loss a year ago.
A full-text copy of the company's consolidated balance sheets is
available for free at http://ResearchArchives.com/t/s?3d6d
About NovaStar Financial Inc.
Headquartered in Kansas City, Missouri, NovaStar Financial Inc.
(NYSE: NFI) -- http://www.novastarmortgage.com/-- prior to
significant changes in its business during 2007 and the first
quarter of 2008, the Company originated, purchased, securitized,
sold, invested in and serviced residential nonconforming mortgage
loans and mortgage backed securities.
OILEXCO NORTH: S.D.N.Y. Court Approves Chapter 15 Petition
----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
has granted the petition of Oilexco North Sea Limited for the
recognition of its insolvency proceedings in the U.K. as a
"foreign main proceeding" under Chapter 15 of the Bankruptcy Code.
Pursuant to the order, all persons and entities are permanently
enjoined from seizing, repossessing, transferring, relinquishing
or disposing of any property of the Company in the United States.
All persons or entities are permanently enjoined from commencing
or continuing any legal proceeding or enforcing any judicial,
quasi-judicial, administrative judgment or order against the
Company or any of its property in the United States. All persons
and entitities in possession, custody or control of property of
the Company or the proceeds thereof, are required to turn over and
account for such property or proceeds therof to the Petitioner.
As reported in the Troubled Company Reporter on April 30, 2009,
Oilexco North Sea Ltd., the U.K. unit of a Canadian oil and gas
exploration and production company, filed a Chapter 15 petition
on April 28, 2009, in New York seeking recognition of insolvency
proceedings in the U.K. as the "foreign main proceeding,"
Bloomberg's Bill Rochelle said.
Chapter 15 allows a company to seek protection from creditors in
the United States while its primary bankruptcy case is pending in
another country. If the U.S. court grants the Chapter 15
petition, the assets in the U.S. can be liquidated or reorganized
through the foreign proceeding.
On January 7, 2009, Oilexco North Sea entered administration and
R. Bailey, A. Bloom, T. Burton, and C. Dempster were appointed
Joint Administrators. The appointment was made by the directors
under the provisions of paragraph 22 of Schedule B1 to the
Insolvency Act of 1986. Oilexco North Sea Ltd continues to trade
under the supervision of the Joint Administrators "whilt they
endeavour to realise a sale of Oilexco North Sea Ltd or its
business and assets."
The Company has an offer to sell the assets for $505 million to
Premier Oil Plc, Mr. Rochelle said.
As reported in the Troubled Company Reporter on February 9, 2009,
Oilexco Incorporated obtained a court order for protection under
the Companies' Creditors Arrangement Act (Canada). Ernst & Young
Inc. was appointed monitor under that order. The order permits
Oilexco (including its wholly-owned Alberta subsidiary Oilexco
Technical Services Inc.) to remain in possession and control of
its property, carry on its business, retain employees and other
service providers and restructure its operations. Proceedings by
creditors and others cannot be commenced without leave of the
court and current proceedings are stayed. The order does not
affect rights of The Royal Bank of Scotland plc and other lenders
to shares of Oilexco's wholly-owned United Kingdom subsidiary
Oilexco North Sea Limited ("ONSL"). Those shares were pledged by
Oilexco as security for Oilexco's obligations as guarantor of
amounts owed by ONSL under the US$547.5 million senior and super
senior credit facility and GBP100 million pre-development credit
facility of ONSL with the lenders.
About Oilexco Inc.
Oilexco Incorporated is an oil and gas exploration and production
company headquartered in Calgary, Canada. Oilexco was founded in
1994, and trades on the TSX Venture Exchange and the London Stock
Exchange. The Company's trading symbol for both exchanges is
"OIL".
Oilexco North Sea Limited filed for Chapter 15 on April 28, 2009
(Bankr. S.D. N.Y. Case No. 09-12641). Roy Bailey, Alan Robert
Bloom, Colin Peter Dempster and Thomas Merchant, as joint
administrators, filed the Chapter 15 petition. The petitioners
are represented by Howard Seife, Esq., at Chadbourne & Parke LLP.
PAPER INTERNATIONAL: Plan Filing Period Extended to September 30
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
has extended Paper International, Inc. and Fiber Management of
Texas, Inc.'s exclusive period to file a plan through and
including September 30, 2009, and exclusive period to solicit
acceptances of that plan through and including November 30, 2009.
As reported in the Troubled Company Reporter on May 21, 2009,
Judge Robert D. Drain approved the adequacy of Corporacion Durango
S.A.B. De C.V., Paper International, and Fiber Management's
disclosure statement explaining their proposed Joint Chapter 11
Plan of Reorganization, which was filed on April 27, 2009.
Accordingly, the Debtors were granted approval to send
solicitation packages -- containing the ballots, the Disclosure
Statement and the Plan -- to noteholders. Holders of
US$520,000,000 10.5% Senior Notes due 2017, issued by Durango in
2007 comprise the lone class of creditors that are entitled to
vote on the Plan. Ballots must be returned by June 8, 2009.
Judge Drain will begin hearings to consider confirmation of the
Plan on June 17, 2009, at 10:00 a.m. Objections, if any, are due
June 8, 2009, by 10:00 a.m.
As reported by to the Troubled Company Reporter on April 28, 2009,
the Joint Chapter 11 Plan provides that the Debtors' businesses
will continue to operate in substantially their current form, with
Paper International continuing to own its equity in Durango
McKinley Paper Company and FMT, and FMT continuing the wind down
of its fiber procurement business, which began when FMT ceased its
operations in August 2008.
Durango will (i) issue $250 million in senior notes ("New Senior
Notes") and (ii) also issue new common stock in connection with
its plan to be submitted in its restructuring proceedings in the
District Court for Civil Matters for the District of Durango, in
the country of Mexico ("Concurso Proceedings"). On the Joint
Chapter 11 Plan's effective date, each Reorganized Debtor will
deliver a joint and several guaranty with respect to the New
Senior Notes ("New Senior Notes Guarantees"). To payoff their
claims, Durango has reached a settlement with certain noteholders
under which the Noteholders will receive their pro rata share of
the New Senior Notes, the New Senior Notes Guarantees, and the
Durango New Equity.
All allowed priority claims and general unsecured claims will be
fully reinstated, and equity holders will retain their interests.
Thus they are unimpaired and will be deemed to have accepted the
Plan. Only the Noteholders, classified under Class 3, are
impaired and will be entitled to vote on the Plan.
A full-text copy of the Joint Chapter 11 Plan of Reorganization,
dated as of April 27, 2009, is available for free at:
http://bankrupt.com/misc/PaperInt'l.Ch11Plan.pdf
A full-text copy of the explanatory Disclosure Statement dated
April 27, 2009, is available for free at:
http://bankrupt.com/misc/PaperInt'l.DS.pdf
About Paper International
Headquartered in Prewitt, New Mexico, Paper International, Inc.
-- http://www.internationalpaper.com/-- is the wholly-owned
direct subsidiary of Corporacion Durango, S.A.B. de C.V., a
corporation organized under the laws of Mexico, which maintains
its principal place of business in Durango, Mexico. The Debtor
currently owns 100% of the equity shares in Fiber Management of
Texas, Inc., a corporation organized under the laws of Texas, as
well as 100% of the equity shares in non-debtor Durango McKinley
Paper Company, a New Mexico company. Paper International is a
holding company which has no employees, no operations, and whose
primary assets are its ownership interests in Durango McKinley and
Fiber Management.
Before August 2008, Fiber Management's primary business was the
procurement of paper materials to manufacture recycled paper
products for use by Durango McKinley and other paper manufacturing
affiliates of Corporacion Durango located in Mexico. In August
2008, Fiber Management ceased procuring fiber and began winding up
all of its business operations.
Paper International and Fiber Management filed for Chapter 11
protection on October 6, 2008 (Bankr. S.D. N.Y. Lead Case No.08-
13917). Larren M. Nashelsky, Esq., and Lorenzo Marinuzzi, Esq.,
at Morrison & Foerster LLP, represent the Debtors as counsel.
Eric Kate Mautner, Esq., at Bingham McCutchen LLP, represents the
Official Committee of Unsecured Creditors as counsel. APS
Services, LLC, serves as the Debtors' crisis managers. The
Debtors designated Meade Monger, a managing director of
AlixPartners, LLP, an affiliate of AP Services, as its chief
restructuring officer. The Court appointed Kurtzman Carson
Consultants, LLC, as claims agent in the Debtors' bankruptcy case.
At March 31, 2009, the Debtors had $123,365,705 in total assets,
$552,348,876 in total liabilities, and $428,983,171 in
stockholders' deficit.
PHILIPS-VAN HEUSEN: Moody's Affirms 'Ba2' Corporate Family Rating
-----------------------------------------------------------------
Moody's Investors Service affirmed Philips-Van Heusen's Corporate
Family Rating and Probability of Default Ratings at Ba2 and
revised the rating outlook to stable from positive.
The rating outlook revision to stable reflects Moody's expectation
that PVH's operating performance and credit metrics will be
pressured over the course of 2009, and as a result Moody's does
not expect PVH to achieve metrics appropriate for a higher rating
over the near to intermediate term. Operating pressures are due
to the macro economic environment, as was evident in the year-
over-year decline in the company's first quarter operating
earnings. PVH has undertaken a number of initiatives to improve
its cost structure including closing less profitable retail
stores. However the weak consumer environment is expected to
significantly offset the impact of these actions.
Notwithstanding the above, PVH remains solidly positioned for its
Ba2 Corporate Family Rating. PVH's ratings reflect its ownership
of the "Calvin Klein" brand, its leading position in the men's
dress furnishings segment and solid credit metrics. A growing
portion of its earnings derived from international activities and
its licensees, which Moody's believes is a long term positive,
though in the near term the stronger US$ will create headwinds.
The ratings also reflect the company's solid liquidity profile,
with its significant cash balances and high level of undrawn
borrowing capacity under a committed revolver that does not expire
until July 2012.
These ratings were affirmed. LGD assessments were also amended.
-- Corporate Family Rating at Ba2
-- Probability of Default Rating at Ba2
-- $100 million senior secured debentures at Baa3 (LGD 2,19%
from LGD 2, 21%)
-- $300 million senior unsecured notes at Ba3 (LGD 5, 72% from
LGD 5, 74%)
The rating outlook is stable.
The last rating action on Philips-Van Heusen was on December 17,
2007, when the company's rating outlook was revised to positive
from stable.
Phillips-Van Heusen Corporation is a leading designer and
distributor of men's sportswear and dress furnishings. The
company's owned brands include Calvin Klein, Van Heusen, Arrow and
IZOD. PVH's total revenues were $2.4 billion for the LTM period
ending in May, 2009.
PRIDE INTERNATIONAL: Fitch Assigns 'BB+' Rating on $500 Mil. Notes
------------------------------------------------------------------
Fitch Ratings has assigned a 'BB+' rating to Pride International
Inc.'s $500 million issuance of senior unsecured notes. In
addition, Fitch currently rates Pride:
-- Issuer Default Rating 'BB+';
-- Senior unsecured credit facility 'BB+';
-- Senior unsecured notes 'BB+'.
The Rating Outlook is Stable.
The ratings continue to reflect Pride's improved balance sheet,
improving asset profile and the company's $8 billion contract
backlog providing significant cash flow protections for the
company in 2009 and beyond. Offsetting factors include declining
market conditions for offshore drillers, significant capital
expenditures associated with the company's four ultra-deepwater
newbuild drillships and the potential for future debt financed
acquisitions as the company continues to transition its asset base
toward deepwater rigs. While the current downturn has resulted in
management shifting focus away from acquisition activity, Fitch
would anticipate Pride to re-focus on growth once market
conditions stabilize or upon completion of the company's
newbuilds.
Pride's proforma credit metrics for the last 12 months ending
March 31, 2009, will weaken as a result of the debt offering.
Pride generated $1,058.6 million of EBITDA for the LTM period, and
free cash flow (cash from operations less capital expenditures)
was a positive $37.2 million, reflecting continued heavy spending
associated with its four newbuild ultra-deepwater drillships.
Interest coverage ended the LTM period at 20.3 times (x), but
would fall to approximately 11.0x on a proforma basis for the debt
offering. Debt-to-EBITDA finished the LTM period at a robust
0.7x, but would rise to approximately 1.15x on a proforma basis.
Debt to capital as of March 31, 2009 was approximately 13.6%, but
would rise to 21% on a proforma basis.
Weaker market conditions in 2009 combined with the spin-off of the
company's mat-supported jack-up fleet will result in credit
metrics further weakening from proforma levels. Cash balances are
expected to fall throughout 2009 and 2010 primarily associated
with continued significant progress payments for Pride's newbuilds
but also due to the need to provide adequate liquidity within the
mat-supported jack-up business (Seahawk Drilling). Proceeds from
the current debt offering, combined with existing cash balances
are currently expected to cover future capital expenditures for
the company until its four newbuilds leave the shipyard and begin
working. That said, deterioration in the offshore drilling market
beyond current expectations, including significant cold stacking
of rigs, significant further declines in dayrates, the loss of
contract backlog due to contract cancellations, or as a result of
operational issues within the fleet, could result in the need for
additional borrowings.
Liquidity remains strong and is expected to improve following the
company's debt offering. Pride's liquidity comes from cash
balances ($660.4 million on March 31, 2009), an undrawn $300
million senior unsecured credit facility (maturing in Deccember
2011) and from operating cash flows ($916.1 million for the LTM
period ending March 31, 2009). The company's next debt maturity
is not until 2014 when the $500 million 7.375% senior notes
mature. Pride's MARAD notes amortize at approximately $30 million
per year until their maturity in 2016.
Key covenants are primarily associated with the senior unsecured
credit facility and include maximum debt to tangible
capitalization (50% covenant threshold), minimum LTM EBITDA to
interest coverage (2.95x covenant level), asset sale restrictions
(allowance provided for divestment of mat-supported jack-ups) and
change of control protections (30% threshold of voting stock).
The 7.375% senior notes due 2014 also have change of control
protections (if the change of control is associated with a ratings
decline). It should be noted, however, that change of control
protections for unsecured bondholders are expected to fall away
with the repayment of the 7.375% senior notes.
Pride is one of the world's largest drilling contractors and
operates a diverse fleet of primarily offshore rigs. The fleet
includes two ultra-deepwater drillships, four newbuild ultra-
deepwater drillships currently under construction, 12
semisubmersible rigs, 27 jack-up rigs and three managed rigs. The
planned divestiture of Pride's mat-supported jack-up rigs would
result in the company's jack-up rig count falling to seven rigs.
PRIDE INTERNATIONAL: Moody's Assigns 'Ba1' Senior Unsec. Rating
---------------------------------------------------------------
Moody's Investors Service assigned a Ba1, LGD4 (56%) rating to
Pride International, Inc.'s proposed offering of senior unsecured
notes. Moody's also affirmed Pride's Ba1 Corporate Family Rating
and Probability of Default Rating and the Ba1, LGD4 (56% changed
from 59%) rating on the company's existing $500 million senior
unsecured notes due 2014. Pride's Speculative Grade Liquidity
Rating is upgraded to SGL-1 from SGL-2, subject to the completion
of the notes offering. The outlook remains positive.
"This debt offering will further strengthen Pride's liquidity and
provide additional funding for its four deepwater drillships under
construction," commented Pete Speer, Moody's Vice-President.
"Although this offering will increase leverage and the medium term
outlook for the company's earnings and cash flows has weakened,
Pride continues to make solid progress on the expansion of its
high quality deepwater drilling fleet."
Since Moody's changed the rating outlook to positive in November
2008, expectations for Pride's EBITDA and operating cash flows in
2009 and 2010 have been reduced primarily due to weaker demand and
dayrates for jackup rigs and midwater rigs as they roll off of
existing contracts and the effect of the cancelled contract for
the Pride Venezuela rig. This has meaningfully increased expected
negative free cash flow for 2010 as the company funds
approximately $1.3 billion of its remaining $1.9 billion of
committed capital expenditures for its four newbuild drillships
over the remainder of 2009 and 2010. The notes offering should
enable Pride to maintain substantial cash balances over the next
twelve months in addition to full availability under its $300
million revolving credit facility, resulting in the upgrade of the
SGL rating to SGL-1.
The additional debt will result in higher leverage metrics going
forward than originally anticipated. However, these metrics would
still be consistent with an investment grade financial profile.
Pride's first drillship remains on schedule for delivery in the
2nd quarter of 2010 with the second drillship expected to be
delivered in mid-2010. The remaining two drillships are scheduled
for 2011 delivery.
Over the next year, Pride's ratings could be upgraded if the
company continues to make demonstrable progress on completing its
newbuild drillships without significant delivery delays and cost
overruns, completes the spin-off of its mat jackup rig business,
and based on Moody's expectations for Pride's earnings and
leverage metrics at that time including the outlook for
contracting the 4th drillship.
Further expansion of Pride's newbuild program without customer
contracts, major debt-funded asset or corporate acquisitions,
and/or share repurchases could result in changing the outlook to
stable or a ratings downgrade. In addition, a material settlement
or adverse effect on Pride's foreign operations or customer
relationships arising from its U.S. Foreign Corrupt Practices Act
investigation or other litigation could pressure the outlook or
ratings.
The last rating action was on December 17, 2008, when Pride's
senior unsecured notes due 2014 were upgraded to Ba1 from Ba2
following the company's completion of its $300 million senior
unsecured credit facility.
Pride International, Inc., is an offshore drilling service
contractor headquartered in Houston, Texas.
RADIATION THERAPY: S&P Puts 'B+' Rating on CreditWatch Negative
---------------------------------------------------------------
Standard & Poor's Ratings Services said that it placed its ratings
for Radiation Therapy Services Inc., including its 'B+' corporate
credit rating, on CreditWatch with negative implications.
"The ratings on Fort Myers, Florida-based outpatient radiation
oncology services provider Radiation Therapy Services Inc. reflect
S&P's heightened concern tied to the competitive and fragmented
oncology market, some geographic concentration risk, the company's
acquisitiveness, and high debt leverage," said Standard & Poor's
credit analyst Cheryl Richer. Debt protection measures were
weakened by a sharp decline in EBITDA in the first quarter of
2009. While the company is currently in compliance with its bank
loan covenants, continued pressure on EBITDA through the remainder
of 2009, combined with covenant step downs, could significantly
reduce headroom.
Radiation Therapy operates in a competitive and fragmented market.
Although doctors use radiation to treat more than one-half of all
cancer cases, the company's focus on a narrow niche of the
oncology market makes it vulnerable to the development of even
more highly effective and safer cancer therapies. EBITDA for the
quarter ended March 31, 2009, declined by 17% as a result of
weaker volumes (mostly in Florida) and reimbursement cuts.
Pressure on patient throughput may reflect increased competition
in certain markets, and a possible decrease in the level of
retiree migration to Florida for the winter months because of the
recession.
Medicare reimbursement cuts are an additional credit concern.
Although demand for services is high because of an aging
population with an increased incidence of cancer, revenue growth
had benefited more from higher reimbursement per procedure than
from procedural volume growth.
Debt to EBITDA, adjusted for operating leases, is 6.3x. The
company's high debt leverage reflective of its LBO by Vestar in
2008 diminish its financial capacity to absorb further revenue
and/or EBITDA declines. At the end of the first quarter of 2009,
the company had under a 15% cushion on its debt leverage covenant.
S&P will review the company's strategy to address these business
and financial issues.
RAILPOWER TECHNOLOGIES: Files 5th Default Status Report
-------------------------------------------------------
Railpower Technologies Corp. provided its fifth bi-weekly Default
Status Report under National Policy 12-203 -- Cease Trade Orders
for Continuous Disclosure Defaults, pursuant to which Railpower
announced that the filing of its audited financial statements,
management's discussion and analysis (MD&A) and related CEO and
CFO certifications for the year ended December 31, 2008, will be
delayed beyond the statutory deadline of March 31, 2009, and that
its financial statements, MD&A and related CEO and CFO
certifications for the first quarter ended March 31, 2009, would
not be filed by the statutory deadline of May 15, 2009.
As previously stated, since the focus of Railpower is currently on
preserving cash during the course of its restructuring process
under the Companies' Creditors Arrangement Act (Canada), it was
deemed in the best interests of Railpower and its stakeholders to
delay the preparation and filing of the financial statements, MD&A
and related CEO and CFO certifications for the time being. The
postponement will also allow Railpower's senior management to
fully focus on Railpower's restructuring process. Railpower does
not know at this time when and if it would be in a position to
prepare and file its financial statements, MD&A and related CEO
and CFO certifications, as such preparation and filing will be
driven by the outcome of its restructuring efforts.
Railpower reports that since announcing the original Notice of
Default on March 13, 2009, and filing its first, second, third and
fourth Default Status Reports on March 27, 2009, April 9, 2009,
April 24, 2009, and May 8, 2009, respectively, except as otherwise
publicly disclosed there have not been any additional material
changes to the information contained therein; nor any failure by
Railpower to fulfill its intentions as stated therein with respect
to satisfying the provisions of the alternative information
guidelines, and, except as disclosed, there are no additional
defaults or anticipated defaults subsequent to such announcement.
Except as otherwise publicly disclosed and as disclosed, there
have been no additional material changes respecting Railpower and
its affairs. Railpower intends to file its next Default Status
Report by June 5, 2009.
Railpower said that the Quebec Superior Court issued an order
providing Railpower with an additional period of protection under
the Companies' Creditors Arrangement Act (Canada). The initial
order, which was first granted under the CCAA in favor of
Railpower on February 4, 2009, and subsequently extended on
March 4, 2009, April 7, 2009, April 20, 2009, and May 20, 2009,
has now been further extended until June 2, 2009, during which
time creditors and other third parties will continue to be stayed
from taking steps against Railpower. The purpose of the stay of
proceedings is to provide Railpower with an opportunity to develop
a comprehensive plan of arrangement for consideration by its
creditors and the courts.
The Board of directors has also announced the departure of Mr.
Pierre Labelle, Railpower's interim Chief Financial Officer. The
Board wishes to thank Mr. Labelle for his contributions to
Railpower.
Railpower Technologies Corp. (TSX: P) -- http://www.railpower.com/
-- is engaged in the development, construction, marketing and
sales of high performance, clean locomotives and power plants for
the transportation and related industries. Railpower has designed
and is marketing a range of locomotives for the North American low
and medium horsepower locomotive market. It has also designed and
is marketing hybrid power plants for rubber tyred gantry cranes
(Eco-Cranes(R)). Its technologies have broader potential and
applications in other markets and industries.
Railpower Technologies Corp. and its U.S. subsidiary, Railpower
Hybrid Technologies Corp., have obtained court protection under
the Companies' Creditors Arrangement Act in Canada pursuant to the
initial order granted by the Quebec Superior Court (No. 500-11-
035434-097). Lawyers at McCarthy Tetrault LLP represent Railpower
in the CCAA proceedings, and Martin P. Rosenthal at Ernst & Young,
Inc., serves as the Canadian Monitor. Mr. Rosenthal filed a
Chapter 15 petition (Bankr. W.D. Pa. Case No. 09-10198) to protect
Railpower Hybrid Technologies Corp.'s assets from U.S. creditors
on February 5, 2009, and ask the U.S. Court to recognize the CCAA
proceeding as the foreign main proceeding.
REDCORP VENTURES: Ken Lowe & Mike Bardell Leave Firm
----------------------------------------------------
Redcorp Ventures Ltd. reported that pursuant to its filing
together with Redfern Resources Ltd. under the Companies'
Creditors Arrangement Act on March 4, 2009, its Chairman of the
Board, Ken Lowe, who was also a director of the Company, and its
Chief Financial Officer, Mike Bardell, has resigned.
The Company wishes to express its sincere appreciation for the
efforts of Messrs. Lowe and Bardell in the advancements made to
develop the Tulsequah Project towards commercial production amidst
deteriorating financial and metal market conditions as well as
their support throughout the CCAA process.
Since the Initial Order the Petitioners have worked closely with
the Monitor and have, among other things, held regular conference
calls between the Petitioners, the Committee of Secured Note
Holders and the Monitor, developed and commenced implementation of
a plan for putting the Tulsequah Project on a "care and
maintenance" basis, initiated proceedings in the United States
Bankruptcy Court for recognition of the Initial Order, arranged
for a central storage facility to be rented, consolidated its
equipment in that facility and developed a plan for the care of
the site to minimize environmental issues. Implementation of that
plan is subject to the Company's forthcoming application to the
Court for additional relief, currently set for May 27, 2009,
failing which it is anticipated that a receiver will be appointed
at the request of the Committee of Secured Note Holders.
Redcorp Ventures Ltd. (CA:RDV) -- http://www.redcorp-ventures.com/
and http://www.redfern.bc.ca/-- is a Vancouver, British Columbia-
based mineral exploration and development company with active
projects in British Columbia, Canada and Portugal.
Redcorp and Redfern sought and were granted protection under the
Companies' Creditors Arrangement Act by order of the Supreme Court
of British Columbia on March 4, 2009. KPMG Inc. was appointed
Monitor.
REDCORP VENTURES: McIntosh & Morawetz Appointed as Receiver
-----------------------------------------------------------
Redcorp Ventures Ltd. reported that, in response to a petition
brought by its secured Noteholders, the British Columbia Supreme
Court determined that the stay of proceedings as extended under
the Companies' Creditors Arrangement Act is no longer appropriate
and appointed McIntosh & Morawetz Inc. receiver of the
Petitioners' current and future personal assets, undertakings and
properties. The powers of the receiver specifically exclude:
(a) any real property or land interests, including, without
limitation, any interests held in accordance with titles
issued in accordance with the Land Title Act of British
Columbia including the Tulsequah Project;
(b) any interest in certain asset backed commercial paper
secured in favor of HSBC Bank Canada except for interest
owing in respect of the predecessor notes to the ABCP;
(c) amounts held by CIBC Mellon Trust Company in an interest
escrow account and payable to the Noteholders in
accordance with the Initial Order; and
(d) any amounts deposited at HSBC Bank Canada and Royal Bank
of Canada or elsewhere by the Redfern Resources Ltd. and
secured in favour of those parties in accordance with
certain safekeeping agreements under the Mines Act and
Standby Letters of Credit issued under the Fisheries Act.
Redcorp Ventures Ltd. (CA:RDV) -- http://www.redcorp-ventures.com
and http://www.redfern.bc.ca-- is a Vancouver, British Columbia-
based mineral exploration and development company with active
projects in British Columbia, Canada and Portugal.
Redcorp and Redfern sought and were granted protection under the
Companies' Creditors Arrangement Act by order of the Supreme Court
of British Columbia on March 4, 2009. KPMG Inc. was appointed
Monitor.
R.H. DONNELLEY: Case Summary & 30 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: R.H. Donnelley Corporation
1001 Winstead Drive
Cary, NC 27513
Bankruptcy Case No.: 09-11833
Debtor-affiliates filing separate Chapter 11 petitions:
Entity Case No.
------ --------
R.H. Donnelley Inc. 09-11834
DonTech Holdings, LLC 09-11835
R.H. Donnelley Publishing & Advertising of Illinois 09-11836
DonTech II Partnership 09-11837
R.H. Donnelley Publishing & Advertising of Illinois 09-11838
R.H. Donnelley Publishing & Advertising, Inc. 09-11839
Get Digital Smart.com, Inc. 09-11840
R.H. Donnelley APIL, Inc. 09-11841
RHD Service LLC 09-11842
Dex Media, Inc. 09-11843
Dex Media East, Inc. 09-11844
Dex Media East LLC 09-11845
Dex Media East Finance Co. 09-11846
Dex Media West, Inc. 09-11847
Dex Media West LLC 09-11848
Dex Media West Finance Co. 09-11849
Dex Media Service LLC 09-11850
Business.com, Inc. 09-11851
Work.com, Inc. 09-11852
Type of Business: R.H. Donnelley Corp., fka The Dun & Bradstreet
Corp. -- http://www.rhdonnelley.com/-- (NYSE:
RHD) publishes and distributes more than 600
print directories in the U.S.
Chapter 11 Petition Date: May 28, 2009
Bankruptcy Court: United States Bankruptcy Court
District of Delaware (Delaware)
Debtor's Counsel: James F. Conlan, Esq.
Larry J. Nyhan, Esq.
Jeffrey C. Steen, Esq.
Jeffrey E. Bjork, Esq.
Peter K. Booth, Esq.
Sidley Austin LLP
One South Dearborn
Chicago, Illinois 60603
Tel: (312) 853-7000
Fax: (312) 853-7036
Debtors' Local
Delaware Counsel: Edmon L. Morton, Esq.
bankfilings@ycst.com
Robert S. Brady, Esq.
bankfilings@ycst.com
Young, Conaway, Stargatt & Taylor LLP
The Brandywine Bldg.
1000 West Street, 17th Floor
P.O. Box 391
Wilmington, DE 19899
Tel: (302) 571-6600
Fax: (302) 571-1253
Debtors'
Financial
Advisor: Deloitte Financial Advisory Services LLP
111 South Wacker Drive
Chicago, Illinois 60606
Debtors'
Investment
Banker: Lazard Freres & Co. LLC
190 S. LaSalle Street, 31st Floor
Chicago, Illinois 60603
R.H. Donnelley Corporation's 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
The Bank of New York R.H. Donnelley $1,229,800,000
101 Barclay Street, Floor 8W Corporation's
New York, NY 10286 8.875% Senior
Tel: (212) 815-5283 Notes due 2016
Fax: (212) 815-5704
The Bank of New York R.H. Donnelley $1,012,800,000
101 Barclay Street, Floor 8W Corporation's
New York, NY 10286 8.875% Senior
Tel: (212) 815-5283 Notes due 2016
Fax: (212) 815-5704
U.S. Bank, National Assoc. Dex Media $761,700,000
60 Livingston Avenue West LLC's
EP-MN-WS3C 9.875% Senior
St. Paul, MN 55170-2292 Subordinated
Tel: (651) 495-3888 Notes due 2013
Fax: (651) 303-0782
The Bank of New York R.H. Donnelley $768,400,000
101 Barclay Street, Floor 8W Corporation's
New York, NY 10286 6.875% Senior
Tel: (212) 815-5283 Discount Notes
Fax: (212) 815-5704 due 2013
U.S. Bank, National Assoc. DexMedia, $750,000,000
60 Livingston Avenue Inc.'s 9%
EP-MN-WS3C Senior Discount
St. Paul, MN 55170-2292 Notes due 2013
Tel: (651) 495-3888
Fax: (651) 303-0782
U.S. Bank, National Assoc. DexMedia, $500,000,000
60 Livingston Avenue Inc.'s 8%
EP-MN-WS3C Senior Notes
St. Paul, MN 55170-2292 due 2013
Tel: (651) 495-3888
Fax: (651) 303-0782
The Bank of New York R.H. Donnelley $412,900,000
101 Barclay Street, Floor 8W Inc.'s 11.75%
New York, NY 10286 Senior Notes
Tel: (212) 815-5283 due 2015
Fax: (212) 815-5704
U.S. Bank, National Assoc. DexMedia $385,000,000
60 Livingston Avenue West LLC's
EP-MN-WS3C 8.5% Senior
St. Paul, MN 55170-2292 Notes due 2010
Tel: (651) 495-3888
Fax: (651) 303-0782
The Bank of New York R.H. Donnelley $206,800,000
101 Barclay Street, Floor 8W Corporation's
New York, NY 10286 6.875% Senior
Tel: (212) 815-5283 Notes due 2013
Fax: (212) 815-5704
U.S. Bank, National Assoc. DexMedia $8,700,000
60 Livingston Avenue West LLC's
EP-MN-WS3C 5.875% Senior
St. Paul, MN 55170-2292 Notes due 2011
Tel: (651) 495-3888
Fax: (651) 303-0782
Google Inc. Trade Payable $2,433,902
1600 Amphitheatre Parkway
Mountain View, CA 94043
Tel: (650) 253-0000
Fax: (650) 253-0001
RR Donnelley Receivables Inc. Trade Payable $2,162,109
111 South Wacker Drive
Chicago, IL 60606
Tel: (312) 326-8000
Fax: (312) 326-7156
Amdocs Incorporated Trade Payable $1,691,068
Tower Hill House, Le Bordage
Suite 5
St. Peter Port, Ontario
GY1 3QT
Canada
Ph: 44-1481-728-444
Fax: 44-31-4212-7500
Yahoo Search Marketing Trade Payable $1,579,889
701 First Avenue
Sunnyvale, CA 94089
Tel: (408) 336-0697
Fax: (408) 349-3301
Specialty Directory Trade Payable $822,624
Distribution Services Inc.
1520 Broadmoor Boulevard
Suite A
BUford, GA 30518
Tel: (770) 932-8886
Fax: (770) 932-8835
Harmelin Media Trade Payable $745,891
525 Righters Ferry Road
Ba1a Cynwyd, PA 19004
Tel: (610) 668-2700
Fax: (610) 688-8412
Product Development Corp. Trade Payable $723,843
20 Ragsdale Drive, Suite 100
Monterrey, CA 93940
Tel: (905) 304-8798
Fax: (831) 333-0110
Quebecor World Inc. Trade Payable $355,411
1000 Remington Boulevard
Suite 300
Bolingbrook, IL 60440
Tel: (514) 877-5143
Fax: (630) 343-4405
Qwest Richard Baer Trade Payable $274,510
1801 California Street
Denver, CO 80202
Tel: (303) 992-1400
Fax: (303) 896-8515
Wiese Research Associates Inc. Trade Payable $272,500
9375 Burr Street, Suite 100
Omaha, NE 68114
Tel: (402) 391-7734
Fax: (402) 391-0331
Web.com Inc. Trade Payable $248,287
12808 Gran Bay Parkway, West
Jacksonville, FL 32258
Tel: (904) 680-6600
Fax: (904) 880-0350
Proudfoot Consulting Company Trade Payable $197,500
1355 Peachstreet, NE
Suite 700
Atlanta, GA 30309
Tel: (561) 624-4377
Fax: (404) 260-0603
Nippon Paper Industries USA Trade Payable $194,013
Co., Ltd.
1815 Marine Drive
Port Angeles, WA 98363
Tel: (360) 457-4474
Fax: (360) 452-9004
Affina LLC Trade Payable $193,459
2001 Ruppman Plaza
Peoria, IL 60614
Tel: (309) 685-5901
Fax: (309) 679-4400
Tembec Inc. Trade Payable $191,245
800 boul. Rene Levesque Quest
Quest - Bureau 1050
Montreal, Quebec H3B 1X9
Canada
Tel: (514) 871-0137
Fax: (514) 397-0896
Entrepreneur.com Trade Payable $168,816
2445 McCabe Way, Suite 400
Irvine, CA 92614
Tel: (949) 261-2325
Fax: (949) 752-1180
Sprint Trade Payable $120,175
9350 Metcalf Avenue
Overland Park, KS 66212
Tel: (703) 433-4000
Fax: (703) 433-4343
Work Flow One Trade Payable $103,072
220 E. Monument Avenue
Dayton, OH 45402
Tel: (937) 630-8405
Fax: (937) 630-8996
GenieKnows Trade Payable $96,648
1567 Argyle Street
Halifax, Nova Scotia B3J 2B2
Canada
Tel: (902) 431-4847
Fax: (902) 431-4848
AT&T Trade Payable $95,741
208 S. Akard Street
Dallas, TX 75202
Tel: (210) 821-4105
Fax: (210) 351-2071
R.H. DONNELLEY: Expects to Exit Chapter 11 in Early January 2010
----------------------------------------------------------------
Beginning in 2008, R.H. Donnelley Corp. experienced lower
advertising sales primarily as a result of declines in recurring
business, both renewal and increases to existing advertising,
mainly driven by weaker economic trends, reduced consumer
confidence, and more cautious advertiser spending in the company's
markets, Steven Blondy, vice president and chief financial officer
of RHD, related in his affidavit filed with the U.S. Bankruptcy
Court for the District of Delaware. Advertising sales, he
continues, have also been impacted by an increase in competition
and more fragmentation in the local business search space.
Furthermore, the company has been experiencing adverse bad debt
trends attributable to many of the same economic challenges in the
company's markets, he adds.
Through the first quarter of 2009, the company's advertising
revenues declined 11% compared to the first quarter of 2008, and
adjusted EBITDA in the quarter was down $37 million or 10% from
the same period in 2008. The decline in revenues, Mr. Blondy
states, has been particularly challenging because the company has
a substantial amount of debt outstanding and significant near-term
debt service obligations, due in large part to financings
associated with prior acquisitions. As of March 31, 2009, the
company has a total outstanding debt of $9.9 billion. In the
calendar year 2009, the company was facing cash interest expenses
of $400 million in connection with unsecured bond debt, and $1.39
billion in principal payments on unsecured and secured debt due in
2010.
Prior to May 28, 2009, the company engaged in discussions about a
potential balance sheet restructuring with ad hoc steering
committees representing its bondholders and bank lenders. The
company entered into forbearance agreements with certain of its
bondholders and bank lenders but the grace period expired on May
15, 2009. The bondholders and bank lenders party to the
forbearance agreements agreed not to pursue their rights under
the applicable debt agreements relating to payment of interests
through May 28, while the parties continued to negotiate the
terms of an overall restructuring.
After several weeks of negotiations, the company, in consultation
with is advisors, has reached agreements-in-principal with a
substantial majority of consenting, unsecured bondholders and the
company's secured lenders on a pre-arranged restructuring plan.
Pre-arranged Restructuring Plan
The terms of the company's pre-arranged restructuring plan are
evidenced by:
(i) prepetition plan support agreements, together with
accompanying term sheets, executed by the company and
lenders holding well in excess of two-thirds in principal
amount and one-half in number of claims under each of the
Prepetition Credit Agreements, a full-text copy of which
is available for free at:
http://bankrupt.com/misc/rhd_banklenderspact.pdf
(ii) a prepetition restructuring support agreement, together
with an accompanying plan term sheet, executed by the
company and bondholders holding in excess of a majority of
the principal amount outstanding under the Prepetition
Note Debt, a full-text of which is available for free at:
http://bankrupt.com/misc/rdh_supportpact.pdf
The salient economic terms of the pre-arranged restructuring plan
are:
* elimination of approximately $6.4 billion of indebtedness,
including $720 million of secured indebtedness, and $500
million of annual interest expense;
* receipt by the bank lenders of approximately $675 million of
debt paydown, in addition to scheduled amortization and
interest payments, subject to future company cash flows;
* the exchange of all Prepetition Note Debt for $300 million
of new seven-year RHD unsecured notes and 100% of the
reorganized RHD equity, subject to dilution pursuant to an
appropriate management incentive plan;
* the RDHI Revolver will be termed out with a maturity of
October 2014 and new pricing of LIBOR plus 600-625 basis
points subject to a grid and the RDHI Term Loans D-1 and D-2
will be amended with new pricing, LIBOR plus 600-625bps
subject to a grid, and a maturity of October 2014;
* the DME and DMW Term As will be amended with extended
maturities of October 2014 and increased pricing of 75bps,
subject to step-downs;
* the DME and DMW Term Loan Bs will be amended with increased
pricing of 50bps, subject to step-downs; and
* enhancement of the collateral and guarantee packages of the
DME, DMW, and RDHI secured debt.
According to Mr. Blondy, the Plan Support Agreements, together
with the applicable term sheets, provide a strong platform for a
consensual plan of reorganization to be filed by the company in
its bankruptcy case and should significantly facilitate the
bankruptcy proceedings and the company's objective of preserving
and enhancing value for the benefit of their stakeholders.
As of emergence, the company anticipates that its secured debt
will be approximately $3.1 billion and its consolidated debt
approximately $3.4 billion, which represents 3.0x and 3.3x net
secured and net consolidated leverage.
The restructuring, Mr. Blondy adds, will allow the company to
preserve and retain significant tax attributes that could
meaningfully reduce its post-emergence cash tax obligations for
the foreseeable future.
R.H. Donnelley entered Chapter 11 to fix its "unhealthy balance
sheet" but doesn't need to address any operational issues while
in bankruptcy, the company's chief executive officer, David
Swanson, told The Wall Street Journal. "It's business as usual
here," he said.
The company expects to exit bankruptcy protection in early
January 2010, the Journal reported, citing Mr. Swanson.
About R.H. Donnelley
Headquartered in Cary, North Carolina, R.H. Donnelley Corp., fka
The Dun & Bradstreet Corp., -- http://www.rhdonnelley.com/--
(NYSE: RHD) publishes and distributes print and online directories
in the U.S. It offers print directory advertising products, such
as yellow pages and white pages directories. R.H. Donnelley Inc.,
Dex Media, Inc. and Local Launch, Inc. are the company's only
direct wholly owned subsidiaries.
KPMG LLP, the Company's independent auditor, in March 2009, raised
substantial doubt on the Company's ability to continue as a going
concern. "The Company has significant amounts of maturing debt
which it may be unable to satisfy commencing March 31, 2010,
significant negative impacts on operating results and cash flows
from the overall downturn in the global economy and higher
customer attrition, and possible debt covenant violations in 2009
that raise substantial doubt about its ability to continue as a
going concern," KPMG said in its March 27 report. R.H. Donnelley
reported a net loss of $2.29 billion for the year ended December
31, 2008, on net revenues of $2.61 billion.
As of March 31, 2009, the Company had $929,829,000 in total assets
and $1,023,526,000 in total liabilities, resulting in $93,697,000
in total shareholders' deficit.
R.H. Donnelley Corp. and 19 of its affiliates filed for Chapter 11
protection on May 28, 2009, (Bank. D. Del. Case No. 09-11833
through 09-11852) after missing a $55 million interest payment on
its senior unsecured notes due April 15. James F. Conlan, Esq.,
Larry J. Nyhan, Esq., Jeffrey C. Steen, Esq., Jeffrey E. Bjork,
Esq., and Peter K. Booth, Esq., at Sidley Austin LLP, in Chicago,
Illinois represent the Debtors in their restructuring efforts.
Edmon L. Morton, Esq., and Robert S. Brady, Esq., at Young,
Conaway, Stargatt & Taylor LLP, in Wilmington, Delaware, serve as
the Debtors' local counsel. The Debtors' financial advisor is
Deloitte Financial Advisory Services LLP while its investment
banker is Lazard Freres & Co. LLC.
Bankruptcy Creditors' Service, Inc., publishes R.H. Donnelley
Bankruptcy News. The newsletter tracks the Chapter 11 proceedings
of R.H. Donnelley Corp. and its debtor-affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
R.H. DONNELLEY: Seeks Extension of Schedules Filing
---------------------------------------------------
R.H. Donnelley Corp. and its debtor-affiliates ask the U.S.
Bankruptcy Court for the District of Delaware to extend the
deadline within which they may file their schedules of assets and
liabilities and statements of financial affairs 45 days from the
current June 29, 2009, deadline.
Section 521 of the Bankruptcy Code and Rule 1007 of the Federal
Rules of Bankruptcy Procedure require a debtor to file its (i)
schedules of assets and liabilities; (ii) schedules of current
income and expenditures; (iii) schedules of executory contracts
and unexpired leases; and (iv) statements of financial affairs
within 15 days after a debtor's bankruptcy filing.
The Debtors' proposed counsel, James F. Conlan, Esq., at Sidley
Austin LLP, in Chicago, Illinois, asserts that the Debtors may
not be able to complete the documents within a month after the
bankruptcy filing due to the substantial size and complexity of
the Debtors' operations. Mr. Conlan submits that extending the
Schedules Filing Deadline will not prejudice the rights of the
Debtors' creditors or other parties-in-interest since no bar date
for the filing of proofs of claim has yet been set. He notes that
the Debtors do not anticipate asking the Court to set a bar date
until after the Schedules and Statements are filed. An extension
of the Schedules Filing Deadline will aid the Debtors' efforts to
ensure accuracy and completeness of the Schedules and Statements,
which promotes efficient administration of the Chapter 11 cases,
Mr. Conlan further contends.
About R.H. Donnelley
Headquartered in Cary, North Carolina, R.H. Donnelley Corp., fka
The Dun & Bradstreet Corp., -- http://www.rhdonnelley.com/--
(NYSE: RHD) publishes and distributes print and online directories
in the U.S. It offers print directory advertising products, such
as yellow pages and white pages directories. R.H. Donnelley Inc.,
Dex Media, Inc. and Local Launch, Inc. are the company's only
direct wholly owned subsidiaries.
KPMG LLP, the Company's independent auditor, in March 2009, raised
substantial doubt on the Company's ability to continue as a going
concern. "The Company has significant amounts of maturing debt
which it may be unable to satisfy commencing March 31, 2010,
significant negative impacts on operating results and cash flows
from the overall downturn in the global economy and higher
customer attrition, and possible debt covenant violations in 2009
that raise substantial doubt about its ability to continue as a
going concern," KPMG said in its March 27 report. R.H. Donnelley
reported a net loss of $2.29 billion for the year ended December
31, 2008, on net revenues of $2.61 billion.
As of March 31, 2009, the Company had $929,829,000 in total assets
and $1,023,526,000 in total liabilities, resulting in $93,697,000
in total shareholders' deficit.
R.H. Donnelley Corp. and 19 of its affiliates filed for Chapter 11
protection on May 28, 2009, (Bank. D. Del. Case No. 09-11833
through 09-11852) after missing a $55 million interest payment on
its senior unsecured notes due April 15. James F. Conlan, Esq.,
Larry J. Nyhan, Esq., Jeffrey C. Steen, Esq., Jeffrey E. Bjork,
Esq., and Peter K. Booth, Esq., at Sidley Austin LLP, in Chicago,
Illinois represent the Debtors in their restructuring efforts.
Edmon L. Morton, Esq., and Robert S. Brady, Esq., at Young,
Conaway, Stargatt & Taylor LLP, in Wilmington, Delaware, serve as
the Debtors' local counsel. The Debtors' financial advisor is
Deloitte Financial Advisory Services LLP while its investment
banker is Lazard Freres & Co. LLC.
Bankruptcy Creditors' Service, Inc., publishes R.H. Donnelley
Bankruptcy News. The newsletter tracks the Chapter 11 proceedings
of R.H. Donnelley Corp. and its debtor-affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
SAINTS MEDICAL: Fitch Puts 'BB+' Rating on Positive Watch
---------------------------------------------------------
Fitch Ratings has placed these bonds issued on behalf of the
Saints Medical Center and currently rated 'BB+' on Rating Watch
Positive:
-- $54 million Massachusetts Health and Educational Facilities
Authority revenue bonds, series 1993A.
The Rating Watch Positive reflects an affiliation agreement signed
between Saints and Covenant Health Systems (revenue bonds rated
'A' by Fitch). Under the terms of the agreement, CHS will co-
sponsor Saints with the Sisters of Charity of Ottawa, Saints'
current sponsor, for a period of up to six years, after which time
CHS will become the sole member of Saints. Before being
finalized, the affiliation agreement must receive various
regulatory and Canonical approvals.
Once the affiliation is finalized Fitch expects that Saints'
series 1993A bonds will be refunded and that the refunding would
happen by the end of calendar year 2009. Fitch will continue to
monitor the situation and take appropriate rating action as
sufficient information develops.
Saints operates a 157-bed acute care hospital in Lowell,
Massachusetts, approximately 30 miles northwest of Boston. In
fiscal 2008, total operating revenue was $132.2 million.
Headquartered in Lexington, Massachusetts, CHS is comprised of
four hospitals, 17 nursing homes, five assisted living/personal
care facilities, two residential care/housing institutions and
other related organizations located in four New England states
(CT, MA, ME, and NH) and PA. CHS had total operating revenue of
approximately $543 million in fiscal 2008.
SEMGROUP ENERGY: Earns $59,000 for Three Months Ended September 30
------------------------------------------------------------------
SemGroup L.P. and its debtor-affiliates reported $59,000 net
income on $53.79 million in total revenues for three months ended
September 30, 2008, compared to $62,000 net income on
$25.28 million in total revenues a year ago.
As of September 30, 2008, the Debtors' consolidated balance sheets
showed $349.11 million in total assets, $25.59 million in total
current liabilities, $448.10 in long-term debt, $418,000 in long-
term capital lease obligations, and $124.99 total partners'
deficit.
A full-text copy of the Debtors' consolidated balance sheets is
available for free at http://ResearchArchives.com/t/s?3d6c
About SemGroup Energy Partners
SemGroup Energy Partners -- http://www.SGLP.com/-- owns and
operates a diversified portfolio of complementary midstream energy
assets. SemGroup Energy Partners provides crude oil and liquid
asphalt cement terminalling and storage services and crude oil
gathering and transportation services. SemGroup Energy Partners
is based in Tulsa, Oklahoma. SGLP's common units are currently
traded on the Pink Sheets, which is an over-the-counter securities
market, under the symbol SGLP.PK. The general partner of SemGroup
Energy Partners is a subsidiary of SemGroup, L.P.
About SemGroup LP
SemGroup L.P. -- http://www.semgrouplp.com/-- is a midstream
service company providing the energy industry means to move
products from the wellhead to the wholesale marketplace. SemGroup
provides diversified services for end users and consumers of crude
oil, natural gas, natural gas liquids, refined products and
asphalt. Services include purchasing, selling, processing,
transporting, terminaling and storing energy. SemGroup serves
customers in the United States, Canada, Mexico, Wales, Switzerland
and Vietnam.
SemGroup L.P. and its debtor-affiliates filed for Chapter 11
protection on July 22, 2008 (Bankr. D. Del. Lead Case No.
08-11525). John H. Knight, Esq., L. Katherine Good, Esq., and
Mark D. Collins, Esq., at Richards Layton & Finger; Harvey R.
Miller, Esq., Michael P. Kessler, Esq., and Sherri L. Toub, Esq.,
at Weil, Gotshal & Manges LLP; and Martin A. Sosland, Esq., and
Sylvia A. Mayer, Esq., at Weil Gotshal & Manges LLP, represent the
Debtors in their restructuring efforts. Kurtzman Carson
Consultants L.L.C. is the Debtors' claims agent. The Debtors'
financial advisors are The Blackstone Group L.P. and A.P. Services
LLC.
Margot B. Schonholtz, Esq., and Scott D. Talmadge, Esq., at Kaye
Scholer LLP; and Laurie Selber Silverstein, Esq., at Potter
Anderson & Corroon LLP, represent the Debtors' prepetition
lenders.
SemGroup L.P.'s affiliates, SemCAMS ULC and SemCanada Crude
Company, sought protection under the Companies' Creditors
Arrangement Act (Canada) on July 22, 2008. Ernst & Young, Inc.,
is the appointed monitor of SemCanada Crude Company and its
affiliates' reorganization proceedings before the Canadian
Companies' Creditors Arrangement Act. The CCAA stay expires on
November 21, 2008.
SemGroup L.P.'s consolidated, unaudited financial conditions as of
June 30, 2007, showed $5,429,038,000 in total assets and
$5,033,214,000 in total debts. In their petition, they showed
more than $1,000,000,000 in estimated total assets and more than
$1,000,000,000 in total debts.
Bankruptcy Creditors' Service, Inc., publishes SemGroup Bankruptcy
News. The newsletter tracks the chapter 11 proceedings undertaken
by SemGroup L.P. and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-700)s
SEMGROUP LP: Seeks to Assume & Assign Thru-Put Pact to Irving Oil
-----------------------------------------------------------------
SemMaterials, L.P., its parent, SemGroup, L.P., and certain of
their debtor subsidiaries, seek the U.S. Bankruptcy Court for the
District of Delaware's authority to assume a thru-put agreement
between Sprague Energy Corporation and Koch Materials Company and
assign the agreement to Irving Oil Terminals Inc. pursuant to a
Liquid Asphalt Terminalling Subcontract.
Semgroup has earlier purchased and assumed the Thru-Put Agreement
from Koch. Pursuant to the Thru-Put Agreement, Sprague was
required to provide and maintain storage facilities at its
asphalt facility in South Portland, Maine, and was also required
to receive, unload, store, and blend asphalt products, and
conduct sampling and testing of the products, and provide Koch
the related report.
The proposed assumption and assignment of the Thru-Put Agreement
is in connection with the sale and wind-down of substantially all
of the assets of SemMaterials, which is primarily engaged in
purchasing, producing, storing and distributing liquid asphalt
cement products, emulsions and residual fuel throughout the
United States.
Pursuant to the LAT Subcontract, Irving Oil agrees to pay $3.18
million in cash, subject to this distribution:
(a) $380,000 to SemMaterials for the 1,315 tons of residual
asphalt inventory housed at the terminal;
(b) $362,022 to Sprague representing the cure amount for the
Thru-Put Agreement;
(c) $434,634 to Sprague for the "take or pay" payment
SemMaterials was required to pay Sprague by June 1, 2009,
pursuant to the Thru-Put Agreement; and
(d) $2,000,366 to SemMaterials for the successful assignment
of the Thru-Put Agreement to Irving Oil.
Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., in
Wilmington, Delaware, says assignment of the Thru-Put Agreement
to Irving Oil will allow SemMaterials to avoid a potentially
sizable rejection claim from Sprague, and resolve Sprague's
prepetition claim, to the estates' best interest.
About SemGroup LP
SemGroup L.P. -- http://www.semgrouplp.com/-- is a midstream
service company providing the energy industry means to move
products from the wellhead to the wholesale marketplace. SemGroup
provides diversified services for end users and consumers of crude
oil, natural gas, natural gas liquids, refined products and
asphalt. Services include purchasing, selling, processing,
transporting, terminaling and storing energy. SemGroup serves
customers in the United States, Canada, Mexico, Wales, Switzerland
and Vietnam.
SemGroup L.P. and its debtor-affiliates filed for Chapter 11
protection on July 22, 2008 (Bankr. D. Del. Lead Case No.
08-11525). John H. Knight, Esq., L. Katherine Good, Esq. and Mark
D. Collins, Esq., at Richards Layton & Finger; Harvey R. Miller,
Esq., Michael P. Kessler, Esq., and Sherri L. Toub, Esq., at Weil,
Gotshal & Manges LLP; and Martin A. Sosland, Esq., and Sylvia A.
Mayer, Esq., at Weil Gotshal & Manges LLP, represent the Debtors
in their restructuring efforts. Kurtzman Carson Consultants
L.L.C. is the Debtors' claims agent. The Debtors' financial
advisors are The Blackstone Group L.P. and A.P. Services LLC.
Margot B. Schonholtz, Esq., and Scott D. Talmadge, Esq., at Kaye
Scholer LLP; and Laurie Selber Silverstein, Esq., at Potter
Anderson & Corroon LLP, represent the Debtors' prepetition
lenders.
SemGroup L.P.'s affiliates, SemCAMS ULC and SemCanada Crude
Company, sought protection under the Companies' Creditors
Arrangement Act (Canada) on July 22, 2008. Ernst & Young, Inc.,
is the appointed monitor of SemCanada Crude Company and its
affiliates' reorganization proceedings before the Canadian
Companies' Creditors Arrangement Act. The CCAA stay expires on
November 21, 2008.
SemGroup L.P.'s consolidated, unaudited financial conditions as of
June 30, 2007, showed $5,429,038,000 in total assets and
$5,033,214,000 in total debts. In their petition, they showed
more than $1,000,000,000 in estimated total assets and more than
$1,000,000,000 in total debts.
Bankruptcy Creditors' Service, Inc., publishes SemGroup Bankruptcy
News. The newsletter tracks the chapter 11 proceedings undertaken
by SemGroup L.P. and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-700)
SEMGROUP LP: Producers' Panel Balks at Russell Reynolds Engagement
------------------------------------------------------------------
The Official Producers' Committee asks the U.S. Bankruptcy Court
for the District of Delaware to deny SemGroup L.P., SemCrude L.P.,
and their debtor affiliates' application to hire Russell Reynolds
Associates, Inc., as their executive search advisors.
"Until the Debtors are able to file a facially confirmable plan,
it is premature for them to be hiring professionals focused on
post-emergence matters," contends Karen McKinley, Esq., at Cole,
Schotz, Meisel, Forman & Leonard, P.A., in Wilmington, Delaware.
Ms. McKinley says it is not yet clear if the Debtors can confirm a
plan, noting that the plan proposed by the Debtors is premised on
payment of $155 million in administrative claims only, although
scheduled Section 503(b)(9) claims alone aggregate $295 million.
Ms. McKinley further complains that the Debtors have not sought to
negotiate with the OPC concerning the Plan, in contravention to
the statement of Judge Shannon at the April 14, 2009 hearing on
the Debtors' exclusive periods extension motion to engage in
"lively communication" with parties-in-interest. The Debtors have
not responded to the OPC's several plan proposals, she discloses,
adding that the Debtors' other attempts to engage in plan
negotiations "have completely been ignored." The information that
has been circulated between the Debtors and OPC is only but a
trickle, she complains. Accordingly, the Court should deny the
Russell Reynolds application, Ms. McKinley asserts.
The Troubled Company Reporter disclosed on May 20, 2009, that
SemGroup L.P., SemCrude L.P., and their debtor affiliates, in
preparation for the filing of their Chapter 11 plan of
reorganization, formed a SemGroup Executive Search Committee --
consisting of three members of the DIP Lenders' steering committee
and two members of the Official Committee of Unsecured Creditors
-- to assist the Debtors in identifying individuals who will serve
as chief executive officer, chief financial officer, and members
of a six-person board of directors of the ultimate parent company,
SemGroup Companies.
For the contemplated services, the Debtors will pay Russell
Reynolds:
(a) a flat fee of $300,000 for its successful search of a CEO;
(b) a $150,000 flat fee for a successful search of a CFO;
(c) a $390,000 flat fee for recruiting six members of the
HoldCo board of directors. If more than six directors are
appointed, the Debtors will pay the firm $60,000 for each
additional director appointed;
(d) a $7,500 flat cost recovery for each of the three searches
to cover search-related expenses that are difficult to
allocate to individual projects; and
(e) reimbursement for reasonable out-of-pocket expenses
incurred in connection with the search.
About SemGroup LP
SemGroup L.P. -- http://www.semgrouplp.com/-- is a midstream
service company providing the energy industry means to move
products from the wellhead to the wholesale marketplace. SemGroup
provides diversified services for end users and consumers of crude
oil, natural gas, natural gas liquids, refined products and
asphalt. Services include purchasing, selling, processing,
transporting, terminaling and storing energy. SemGroup serves
customers in the United States, Canada, Mexico, Wales, Switzerland
and Vietnam.
SemGroup L.P. and its debtor-affiliates filed for Chapter 11
protection on July 22, 2008 (Bankr. D. Del. Lead Case No.
08-11525). John H. Knight, Esq., L. Katherine Good, Esq. and Mark
D. Collins, Esq., at Richards Layton & Finger; Harvey R. Miller,
Esq., Michael P. Kessler, Esq., and Sherri L. Toub, Esq., at Weil,
Gotshal & Manges LLP; and Martin A. Sosland, Esq., and Sylvia A.
Mayer, Esq., at Weil Gotshal & Manges LLP, represent the Debtors
in their restructuring efforts. Kurtzman Carson Consultants
L.L.C. is the Debtors' claims agent. The Debtors' financial
advisors are The Blackstone Group L.P. and A.P. Services LLC.
Margot B. Schonholtz, Esq., and Scott D. Talmadge, Esq., at Kaye
Scholer LLP; and Laurie Selber Silverstein, Esq., at Potter
Anderson & Corroon LLP, represent the Debtors' prepetition
lenders.
SemGroup L.P.'s affiliates, SemCAMS ULC and SemCanada Crude
Company, sought protection under the Companies' Creditors
Arrangement Act (Canada) on July 22, 2008. Ernst & Young, Inc.,
is the appointed monitor of SemCanada Crude Company and its
affiliates' reorganization proceedings before the Canadian
Companies' Creditors Arrangement Act. The CCAA stay expires on
November 21, 2008.
SemGroup L.P.'s consolidated, unaudited financial conditions as of
June 30, 2007, showed $5,429,038,000 in total assets and
$5,033,214,000 in total debts. In their petition, they showed
more than $1,000,000,000 in estimated total assets and more than
$1,000,000,000 in total debts.
Bankruptcy Creditors' Service, Inc., publishes SemGroup Bankruptcy
News. The newsletter tracks the chapter 11 proceedings undertaken
by SemGroup L.P. and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-700)
SEMGROUP LP: Creditors' Panel Renews Rule 2004 Discovery Request
----------------------------------------------------------------
The Official Committee of Unsecured Creditors of SemGroup L.P.,
SemCrude L.P., and their debtor affiliates seeks to renew its
motion to conduct examinations under Rule 2004 of the Federal
Rules of Bankruptcy Procedure and direct production of documents
to:
* PricewaterhouseCoopers L.L.P.,
* Barclays Bank, PLC,
* Hall, Estill, Hardwick, Gable, Golden & Nelson,
* Ritchie Capital Management, LLC, and
* Carlyle/Riverstone Global Energy and Power Fund II, L.P.
The Creditors' Committee has previously agreed to adjourn the
Rule 2004 Motion it filed on August 22, 2008, until the examiner
appointed in SemGroup, L.P.'s Chapter 11 case has filed his
report. In relation to the Rule 2004 Motion, the Creditors
Committee has also entered into an agreement contemplating the
sharing of any documents produced formally or informally to the
Examiner. However, the Creditors' Committee, even after the
filing of the Examiner's Report, has not received any of the
documents produced to the Examiner, Bonnie Glantz Fatell, Esq.,
at Blank Rome LLP, in Wilmington, Delaware, tells the U.S.
Bankruptcy Court for the District of Delaware.
Accordingly, the Creditors' Committee renews its first request for
the production of documents as to each of the respondents relating
to their business transactions and relationships with the Debtors
or the Debtors' representatives. Ms. Fatell asserts that the
Creditors' Committee has no other means of obtaining the documents
necessary to investigate potential claims against third parties
and to initiate any resulting causes of action, pursuant to its
fiduciary duties.
Ms. Fatell further discloses that:
* PwC has agreed to produce the documents provided that it
receives access to the documents that the Examiner received
from other third parties. Given that the Creditors'
Committee has no control over the third parties and on their
willingness to produce documents to PwC, PwC's proposal, in
effect, denied the Creditors' Committee the ability to
receive the firm's documents.
* Barclays said it sees no reason to provide further
information to the Creditors' Committee.
* As of May 14, 2009, Hall Estill has not informed the
Creditors' Committee of its position on the motion.
* Ritchie Capital does not object to the motion.
* Carlyle/Riverstone does not object to the motion and will
produce, no later than seven days of entry of the order
granting the motion, all documents it produced to the
Examiner.
Accordingly, the Creditors' Committee asks the Court to direct the
respondents to begin production, by personal delivery to its
counsel, no later than 20 days after entry of the order.
In a supplemental motion, the Creditors' Committee also asks the
Court to direct J. Aron & Company and Goldman Sachs Group to
produce documents they provided the Examiner. The Official
Producers' Committee joins in the Creditors' Committee's request.
Respondents Object
PwC and Hall Estill, in separate filings, and J. Aron Company and
Goldman Sachs & Co., in a joint filing, oppose the Creditors'
Committee's Rule 2004 motion and ask the Court to deny the
requests.
PwC's counsel, John H. Schanne, II, Esq., at Pepper Hamilton LLP,
in Wilmington, Delaware, asserts that the motion should be stayed
until a document-sharing protocol is in place. Mr. Schanne
relates that PwC has proposed to the Creditors' Committee a
documents-sharing protocol whereby PwC receives reciprocal rights
to the materials that other entities produced to the Examiner, but
the Committee rejected the proposal. Given the public nature of
the Rule 2004 proceedings, he asserts that a coordinating protocol
is appropriate and would achieve Rule 2004's purpose of swiftly
identifying and publicly disclosing, not concealing, matters
relevant to the Debtors' Chapter 11 cases.
Hall Estill argues that good cause does not exist to require it to
"cull through, analyze and produce millions of documents, which
would require an overwhelming amount of time and expense" to
accomplish. Noting that most of the documents requested for
production are owned, controlled and thus, available from the
Debtors, non-Debtors and their officers, and the Kivisto entities,
Hall Estill asserts that the Creditors' Committee should not be
permitted to seek directly, at Hall Estill's considerable expense,
documents the Committee can seek directly from those other
parties.
Representing J. Aron and Goldman Sachs, William P. Bowden, Esq.,
at Ashby & Geddes, P.A., in Wilmington, Delaware, argues that as a
matter of black letter law, the Creditors' Committee cannot obtain
discovery, pursuant to Rule 2004, from the respondents, the
Creditors Committee being a defendant in J. Aron's pending tender
adversary action. Mr. Bowden asserts that discovery can only be
obtained, if at all, pursuant to the formal discovery process
under the Federal Rules of Civil Procedure.
Committee and Barclays Stipulate
The Creditors' Committee reached a stipulation with Barclays Bank,
PLC, providing that Barclays agree to voluntarily provide
documents in response to the Creditors' Committee's motion, or
otherwise. Barclays reserves its right to waive the right to
assert any objections to documents request by the Creditors'
Committee.
* * *
The Court will convene a hearing to consider approval of the Rule
2004 motions on June 2, 2009.
About SemGroup LP
SemGroup L.P. -- http://www.semgrouplp.com/-- is a midstream
service company providing the energy industry means to move
products from the wellhead to the wholesale marketplace. SemGroup
provides diversified services for end users and consumers of crude
oil, natural gas, natural gas liquids, refined products and
asphalt. Services include purchasing, selling, processing,
transporting, terminaling and storing energy. SemGroup serves
customers in the United States, Canada, Mexico, Wales, Switzerland
and Vietnam.
SemGroup L.P. and its debtor-affiliates filed for Chapter 11
protection on July 22, 2008 (Bankr. D. Del. Lead Case No.
08-11525). John H. Knight, Esq., L. Katherine Good, Esq. and Mark
D. Collins, Esq., at Richards Layton & Finger; Harvey R. Miller,
Esq., Michael P. Kessler, Esq., and Sherri L. Toub, Esq., at Weil,
Gotshal & Manges LLP; and Martin A. Sosland, Esq., and Sylvia A.
Mayer, Esq., at Weil Gotshal & Manges LLP, represent the Debtors
in their restructuring efforts. Kurtzman Carson Consultants
L.L.C. is the Debtors' claims agent. The Debtors' financial
advisors are The Blackstone Group L.P. and A.P. Services LLC.
Margot B. Schonholtz, Esq., and Scott D. Talmadge, Esq., at Kaye
Scholer LLP; and Laurie Selber Silverstein, Esq., at Potter
Anderson & Corroon LLP, represent the Debtors' prepetition
lenders.
SemGroup L.P.'s affiliates, SemCAMS ULC and SemCanada Crude
Company, sought protection under the Companies' Creditors
Arrangement Act (Canada) on July 22, 2008. Ernst & Young, Inc.,
is the appointed monitor of SemCanada Crude Company and its
affiliates' reorganization proceedings before the Canadian
Companies' Creditors Arrangement Act. The CCAA stay expires on
November 21, 2008.
SemGroup L.P.'s consolidated, unaudited financial conditions as of
June 30, 2007, showed $5,429,038,000 in total assets and
$5,033,214,000 in total debts. In their petition, they showed
more than $1,000,000,000 in estimated total assets and more than
$1,000,000,000 in total debts.
Bankruptcy Creditors' Service, Inc., publishes SemGroup Bankruptcy
News. The newsletter tracks the chapter 11 proceedings undertaken
by SemGroup L.P. and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-700)
SEMGROUP LP: BDO Seidman Bills $2.4MM for March & April Services
----------------------------------------------------------------
Pursuant to Section 331 of the Bankruptcy Code, professionals
hired in SemGroup L.P., SemCrude L.P., and their debtor-
affiliates' bankruptcy cases filed applications for the allowance
of fees and reimbursement of expenses:
A. Debtors' Professionals:
Firm Period Fees Expenses
---- ---------- ----------- --------
Blackstone
Advisory 12/01/08 -
Services L.P. 03/31/09 $1,206,451 $140,596
Richards, Layton 04/01/09 -
& Finger, P.A. 04/30/09 155,364 11,497
BDO Seidman LLP 03/01/09 -
03/31/09 1,039,513 149,629
BDO Seidman LLP 04/01/09 -
04/30/09 1,369,121 174,200
Conner & 03/01/09 -
Winters, LLP 03/31/09 441,005 728
Bifferato LLC 04/01/09 -
04/30/09 12,284 979
BDO Seidman's application for the period from March 1 to 31, 2009,
supersedes the one filed previously for payment of $1,043,391 in
fees, and reimbursement of $149,629 in expenses, which application
BDO Seidman withdrew.
Warren H. Smith, Esq., at Warren H. Smith & Associates, P.C., the
in Dallas, Texas, recommends, as fee auditor, the payment of fees
and reimbursement of expenses sought by Blackstone Advisory
Services L.P. in its application for the period from July 22,
2008 to November 30, 2008. Mr. Smith has reviewed the related
application of Blackstone.
The Fee Examiner also recommends approval of fees totaling
$675,529 and expenses totaling $76,897 for Richards Layton's
services from July 22 through November 30, 2008, after noting
discrepancies in the firm's time entries and excess from the
expense limit.
B. Official Producers' Committee's Professionals:
Firm Period Fees Expenses
---- ---------- ---------- --------
Lain, Faulkner 04/01/09 -
& Co., P.C. 04/30/09 $132,190 $807
Cole, Schotz,
Meisel, Forman 04/01/09 -
& Leonard, P.A. 04/30/09 10,433 1,597
C. Examiner's Professionals
Firm Period Fees Expenses
---- ---------- ---------- --------
Morrison & 04/01/09 -
Foerster LLP 04/30/09 $215,918 $4,817
Freeh Group 04/01/09 -
International 04/30/09 59,845 2,472
KPMG LLP 04/01/09 -
04/30/09 55,401 741
Polsinelli 04/01/09 -
Shughart PC 04/30/09 19,722 204
The firms disclose that they did not receive timely objections to
their fee applications for the indicated periods:
Firm Period
---- -------
Richards, Layton & Finger, P.A. 03/01/09 - 03/31/09
Jeffrey J. Burns, C.P.A. 03/16/09 - 04/25/09
Blackstone Advisory Services L.P. 03/01/09 - 03/31/09
Bifferato LLC 01/01/09 - 01/31/09
Bifferato LLC 02/01/09 - 02/28/09
Bifferato LLC 03/01/09 - 03/31/09
Goldin Associates, LLC 03/01/09 - 03/31/09
Warren H. Smith & Associates, P.C. 03/01/09 - 03/31/09
Weil, Gotshal & Manges LLP 12/01/08 - 12/31/08
Polsinelli Shughart PC 03/01/09 - 03/31/09
Morrison & Foerster LLP 03/01/09 - 03/31/09
Freeh Group International 03/01/09 - 03/31/09
KPMG LLP 03/01/09 - 03/31/09
PA Consulting Group, Inc. 03/01/09 - 03/31/09
Conner & Winters, LLP 02/01/09 - 02/28/09
Hunton & Williams LLP 01/21/09 - 03/31/09
Goldin Associates, LLC 02/01/09 - 02/28/09
Lain Faulkner & Co., P.C. 03/01/09 - 03/31/09
Blank Rome LLP 02/01/09 - 03/31/09
About SemGroup LP
SemGroup L.P. -- http://www.semgrouplp.com/-- is a midstream
service company providing the energy industry means to move
products from the wellhead to the wholesale marketplace. SemGroup
provides diversified services for end users and consumers of crude
oil, natural gas, natural gas liquids, refined products and
asphalt. Services include purchasing, selling, processing,
transporting, terminaling and storing energy. SemGroup serves
customers in the United States, Canada, Mexico, Wales, Switzerland
and Vietnam.
SemGroup L.P. and its debtor-affiliates filed for Chapter 11
protection on July 22, 2008 (Bankr. D. Del. Lead Case No.
08-11525). John H. Knight, Esq., L. Katherine Good, Esq. and Mark
D. Collins, Esq., at Richards Layton & Finger; Harvey R. Miller,
Esq., Michael P. Kessler, Esq., and Sherri L. Toub, Esq., at Weil,
Gotshal & Manges LLP; and Martin A. Sosland, Esq., and Sylvia A.
Mayer, Esq., at Weil Gotshal & Manges LLP, represent the Debtors
in their restructuring efforts. Kurtzman Carson Consultants
L.L.C. is the Debtors' claims agent. The Debtors' financial
advisors are The Blackstone Group L.P. and A.P. Services LLC.
Margot B. Schonholtz, Esq., and Scott D. Talmadge, Esq., at Kaye
Scholer LLP; and Laurie Selber Silverstein, Esq., at Potter
Anderson & Corroon LLP, represent the Debtors' prepetition
lenders.
SemGroup L.P.'s affiliates, SemCAMS ULC and SemCanada Crude
Company, sought protection under the Companies' Creditors
Arrangement Act (Canada) on July 22, 2008. Ernst & Young, Inc.,
is the appointed monitor of SemCanada Crude Company and its
affiliates' reorganization proceedings before the Canadian
Companies' Creditors Arrangement Act. The CCAA stay expires on
November 21, 2008.
SemGroup L.P.'s consolidated, unaudited financial conditions as of
June 30, 2007, showed $5,429,038,000 in total assets and
$5,033,214,000 in total debts. In their petition, they showed
more than $1,000,000,000 in estimated total assets and more than
$1,000,000,000 in total debts.
Bankruptcy Creditors' Service, Inc., publishes SemGroup Bankruptcy
News. The newsletter tracks the chapter 11 proceedings undertaken
by SemGroup L.P. and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-700)
SENCORP: Moves to Sell Assets; Gets $41 Mil. Bid From Wynnchurch
----------------------------------------------------------------
The Hon. J. Vincent Aug, Jr., of the U.S. Bankruptcy Court for the
Southern District of Ohio approved bidding procedures to govern
the auction for substantially all of the assets of SENCORP and its
debtor-affiliates.
Wynnchurch Capital Ltd., the designated stalking-horse bidder,
agreed to purchase the Debtors' assets for $41 million, subject to
adjustments, including the assumption of liabilities. If the
Debtors consummate the sale to another party, Wynnchurch Capital
will be paid $1 million break-up fee.
Interested purchasers are required to submit a $2.195 million
deposit by June 26, 2009, to Wynnchurch Capital's counsel Vedder
Price P.C. at 222 North LaSalle Street in Chicago, Illinois.
An auction will take place on July 1, 2009, at 11:00 a.m., at
Frost Brown Todd LLC, 2200 PNC Center 201 East Fifth Street in
Cincinnati, Ohio, followed by a sale hearing the following day at
10:00 a.m.
About SENCORP
Headquartered in Cincinnati, Ohio, SENCORP makes and sells branded
pneumatic and battery powered staplers, nailers and screw systems
and collated staples, nails and screws. SENCORP's brand names are
well known in the industry for quality, reliability and service.
Certain aspects of SENCORP's businesses, including the SENCO name,
have existed for over 50 years. Most of the Company's top ten
customers have purchase products.
SENCORP and its affiliates filed for Chapter 11 on May 8 (Bankr.
S. D. Ohio Case No. 09-12869) to facilitate the sale of its assets
under 11 U.S.C. Sec. 363 to an investor group led by Wynnchurch
Capital, Ltd., and including Great Lakes Equity Partners. The
Debtors are tapping The Garden City Group, Inc., as notice, claims
and balloting agent; Mesirow Financial, Inc., as Investment
Banker; Morris-Anderson & Associates Ltd., for advice on
restructuring alternatives; Latham & Watkins LLP as bankruptcy
counsel; and Frost Brown Todd LLC as co-counsel. The secured
lenders are represented by Katten Muchin Rosenman LLP. The
Debtors have assets and debts both ranging from $100 million to
$500 million.
SENCORP: Section 341(a) Meeting Scheduled for June 18
-----------------------------------------------------
Daniel M. McDermott, the U.S. Trustee for Region 9, will convene a
meeting of creditors of SENCORP and its debtor-affiliates on
June 18, 2009, 10:00 a.m., Potter Stewart US Courthouse, 100 East
Fifth Street, Room B?17 in Cincinnati, Ohio.
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.
About SENCORP
Headquartered in Cincinnati, Ohio, SENCORP makes and sells branded
pneumatic and battery powered staplers, nailers and screw systems
and collated staples, nails and screws. SENCORP's brand names are
well known in the industry for quality, reliability and service.
Certain aspects of SENCORP's businesses, including the SENCO name,
have existed for over 50 years. Most of the Company's top ten
customers have purchase products.
SENCORP and its affiliates filed for Chapter 11 on May 8 (Bankr.
S. D. Ohio Case No. 09-12869) to facilitate the sale of its assets
under 11 U.S.C. Sec. 363 to an investor group led by Wynnchurch
Capital, Ltd., and including Great Lakes Equity Partners. The
Debtors are tapping The Garden City Group, Inc., as notice, claims
and balloting agent; Mesirow Financial, Inc., as Investment
Banker; Morris-Anderson & Associates Ltd., for advice on
restructuring alternatives; Latham & Watkins LLP as bankruptcy
counsel; and Frost Brown Todd LLC as co-counsel. The secured
lenders are represented by Katten Muchin Rosenman LLP. The
Debtors have assets and debts both ranging from $100 million to
$500 million.
SENCORP: U.S. Trustee Forms Five-Member Creditors' Committee
------------------------------------------------------------
Daniel M. McDermott, the U.S. Trustee for Region 9, appointed five
creditors to serve on the Official Committee of Unsecured
Creditors in SENCORP and its debtor-affiliates' Chapter 11 cases.
The members of the Committee are:
a) Deench Corp.
c/o Jack R. Pigman, Esq.
Porter, Wright, Morris & Arthur, LLP
41 S. High Street
Columbus, OH 43215
b) Trim International, Inc.
c/o Skipper Yih, CEO
21 F No. 508 Sec. 5
Chung Hsiaio E. Rd.
Taipei, Taiwan
c) Keystone Consolidated Industries, Inc.
c/o Bert E. Downing, Jr., VP/CFO
5430 LBJ Freeway, Suite 1740
Dallas TX 75240
d) Johnstown Wire Technologies, Inc.
c/o Ronald E. Shaffer, VP
124 Laurel Road
Johnstown, PA 15906
e) Corus Internationl Trading
c/o Ronald E. Allen, Jr., VP
475 N. Martingale road, Suite 400
Schaumburg, IL 60173
Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at the Debtor's
expense. They may investigate the Debtor's business and financial
affairs. Importantly, official committees serve as fiduciaries to
the general population of creditors they represent. Those
committees will also attempt to negotiate the terms of a
consensual Chapter 11 plan -- almost always subject to the terms
of strict confidentiality agreements with the Debtors and other
core parties-in-interest. If negotiations break down, the
Committee may ask the Bankruptcy Court to replace management with
an independent trustee. If the Committee concludes reorganization
of the Debtor is impossible, the Committee will urge the
Bankruptcy Court to convert the Chapter 11 cases to a liquidation
proceeding.
About SENCORP
Headquartered in Cincinnati, Ohio, SENCORP makes and sells branded
pneumatic and battery powered staplers, nailers and screw systems
and collated staples, nails and screws. SENCORP's brand names are
well known in the industry for quality, reliability and service.
Certain aspects of SENCORP's businesses, including the SENCO name,
have existed for over 50 years. Most of the Company's top ten
customers have purchase products.
SENCORP and its affiliates filed for Chapter 11 on May 8 (Bankr.
S. D. Ohio Case No. 09-12869) to facilitate the sale of its assets
under 11 U.S.C. Sec. 363 to an investor group led by Wynnchurch
Capital, Ltd., and including Great Lakes Equity Partners. The
Debtors are tapping The Garden City Group, Inc., as notice, claims
and balloting agent; Mesirow Financial, Inc., as Investment
Banker; Morris-Anderson & Associates Ltd., for advice on
restructuring alternatives; Latham & Watkins LLP as bankruptcy
counsel; and Frost Brown Todd LLC as co-counsel. The secured
lenders are represented by Katten Muchin Rosenman LLP. The
Debtors have assets and debts both ranging from $100 million to
$500 million.
SHELDON GOOD: To Present Financing Pact With Cuticelli to Court
---------------------------------------------------------------
Mary Ellen Podmolik at Chicago Tribune reports that Sheldon Good &
Co. will ask the U.S. Bankruptcy Court for the Southern District
of New York to consider a financing agreement with Cuticelli
Capital, LLC, which could lead to the Company's sale.
Chicago Tribune relates that if the Court approves the agreement,
Sheldon Good would receive up to $2 million in debtor-in-
possession financing from Cuticelli Capital, which could also be
established as the "stalking horse" bidder.
Cuticelli Capital is named as "purchaser" in court documents.
Cuticelli Capital chief John Cuticelli Jr. held a management
position at Sheldon Good earlier in his career and has been
involved in real estate acquisition, purchase, development,
redevelopment, and lending since 1974. Mr. Cuticelli founded five
years ago Racebrook Capital Advisors, LLC, an investment firm.
New York-based Sheldon Good & Company, founded in 1965, has sold
more than 45,000 U.S. and international properties in more than
100 different asset classes and produced more than $10 billion in
sales. The real estate auction and marketing firm, with offices
in Chicago, New York, Phoenix, and Denver, has been ranked the
number one real estate auction firm in the U.S. by Forbes,
Fortune, and The Wall Street Journal.
The Company and its affiliates filed for Chapter 11 bankruptcy
protection on April 24, 2009 (Bankr. S.D. N.Y. Case No. 09-12535).
Heidi J. Sorvino, Esq., at Smith, Gambrell & Russell, LLP, assists
the Debtors in their restructuring efforts. Sheldon Good listed
up to $50,000 in assets and $500,001 to $1,000,000 in liabilities.
SOURCE INTERLINK: Court Confirms Pre-Packaged Chapter 11 Plan
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware has
confirmed Source Interlink Companies, Inc.'s pre-packaged Plan of
Reorganization under Section 1129 of the Bankruptcy Code.
The Court overruled all objections to the Plan at the confirmation
hearing.
As reported in the Troubled Company Reporter on May 7, 2009,
Source Interlink reached a restructuring agreement to take the
Company private and eliminate nearly $1 billion of its existing
debt. To facilitate the restructuring, the Company filed on April
28, 2009, a lender-approved pre-packaged Plan of Reorganization
under Chapter 11 of the U.S. Bankruptcy Code. The Plan proposes
to pay holders of term loan claims 66.4% of their allowed claims.
General unsecured claimants will get 100% of the amount they're
owed. Holders of Senior Notes and equity securities won't get a
dime. A full-text copy of Source Interlink's plan summary is
available at no charge at:
http://bankrupt.com/misc/SourceInterlinkPlanSummary.PDF
Source Interlink Chairman and Chief Executive Officer Greg Mays
said, "We continue to be very pleased with the progress made this
week in our plan to go private and eliminate a substantial portion
of our existing debt. We are also pleased with the response of
our trading partners, all of which have enthusiastically supported
our plan. Our restructuring is progressing better than expected.
We are on schedule to emerge shortly with significantly less debt,
materially reduced interest expense and substantially improved
free cash flow allowing us to capitalize on several operational
opportunities to further improve and grow our business. Our
restructuring also will permit our employees to continue to do
what they do best -- provide exceptional service to our
customers."
About Source Interlink
Bonita Springs, Florida-based Source Interlink Companies, Inc., --
http://www.sourceinterlink.com/-- is a U.S. distributor of home
entertainment products and services and one of the largest
publishers of magazines and online content for enthusiast
audiences. Source Interlink Media, LLC publishes more than 75
magazines and 90 related Web sites.
Source Interlink and 17 affiliates filed for bankruptcy on April
27, 2009 (Bankr. D. Del. Case No. 09-11424). Judge Kevin Gross
presides over the case. David Eaton, Esq., and David Agay, Esq.,
at Kirkland & Ellis LLP; and Laura Davis Jones, Esq., Mark M.
Billion, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang
Ziehl Young Jones in Wilmington, Delaware, serve as bankruptcy
counsel. Meolis & Company LLC serves as the Debtors' financial
advisors, while Kurtzman Carson Consultants LLC is the Debtors'
claims and notice agent. As of April 24, 2009, the Debtors had
$2,436,005,000 in total assets and $1,995,504,000 in total debts.
STANADYNE HOLDINGS: Moody's Junks Corporate Family Rating
---------------------------------------------------------
Moody's Investors Service downgraded the Corporate Family Rating
of Stanadyne Holdings, Inc., to Caa1 from B3. In a related
action, Moody's lowered the rating of Stanadyne's senior discount
notes to Caa3 from Caa2, the rating on the senior subordinated
notes of Stanadyne's wholly owned subsidiary, Stanadyne
Corporation, to Caa1 from B3; and the rating on Stanadyne
Corporation's senior secured bank credit facilities to B1 from
Ba3. Moody's also downgrades Stanadyne's Speculative Grade
Liquidity rating to SGL-3 from SGL-2. The outlook is negative.
The downgrade of CFR to Caa1 reflects Moody's expectation that
Stanadyne's operating performance will deteriorate substantially
during 2009 as a result of weakening demand for its diesel fuel
injection products from all its end markets, and could pressure
the company's ability to generate sufficient cash flow relative to
its debt structure. Stanadyne reported a roughly 43% revenue
decline during the first quarter (after a 13% decline in fourth
quarter 2008) compared to the prior year period, while its
operating income turned negative. The deterioration in operating
performance was largely driven by severely depressed end market
demand in the agriculture and construction businesses on a global
basis, and to a lesser extent, due to customers' aggressive
inventory de-stocking. As a result, the company experienced sales
reductions to its major customers between 30% and 90% when
compared to the same period in 2008. Its historically more
counter-cyclical aftermarket business (40% of total sales) also
witnessed significant decline in sales of approximately 35% due to
lower service demand and de-stocking. Although there is a
possibility that the demand could recover modestly as customers
replenish the inventory, Moody's does not expect the recovery will
be substantial in most of Stanadyne's end markets, in particular
the agricultural, construction and industrial sectors in the near-
term. While the company has taken significant measures to
restructure its operations, its high operating and financial
leverage have constrained its ability to adjust its cost structure
quickly. Consequently, Moody's expects that credit metrics would
deteriorate significantly, with adjusted debt-to-EBITDA leverage
possibly rising above 7.0x and EBIT/Interest remaining well below
1.0x over the intermediate term.
The revision of SGL to SGL-3 reflects the thinning cash flow
generation (though still expected to be above breakeven) and
eroding cash balance as business deteriorates. Free cash flow
will be under further pressure when the $6 million biannual cash
interest on the 12% $100 million Senior Discount Notes becomes
payable in February 2010. Also tempering the SGL rating is the
maturing $35 million revolving credit facility due August 5, 2009.
Although the company had no draw on this facility at the end of
the first quarter, it does use it for backing up its letter of
credit of $6-7 million. Inability to renew the facility upon
maturity could pressure the SGL downward.
The negative outlook incorporates the continuing prospects for
weak demand across all end markets, and concern on the company's
ability to generate sustainable positive free cash flow in an
extremely challenging time. The outlook also considers the
sustainability of its current capital structure, which could
become questionable should the negative operating trend continue,
thus hinder its ability to service Stanadyne's debt obligations,
particularly the $100 million discount notes (un-guaranteed by
Stanadyne's operating subsidiaries), as the upstream payment to
Stanadyne from its operating companies is governed by a formula
based on cumulative net earnings.
These ratings were downgraded:
Stanadyne Holdings, Inc.
-- Corporate Family Rating, to Caa1 from B3;
-- Probability of Default Rating, to Caa1 from B3
-- $100 million (face amount) of 12% unguaranteed senior
discount notes due 2015 to Caa3(LGD5,88%) from Caa2 (LGD6
90%)
-- Speculative grade liquidity, to SGL-3 from SGL-2
Stanadyne Corporation
-- $35 million asset-based guaranteed senior secured revolving
credit facility due 2009; to B1(LGD1, 2%) from Ba3 (LGD1, 3%)
-- $65 million (approximately $15 million remaining) guaranteed
senior secured term loan due 2010; to B1(LGD1, 2%) from Ba3
(LGD1, 3%)
-- $160 million of guaranteed senior subordinated notes due
2014, to Caa1(LGD4, 51%) from B3 (LGD4 56%)
-- Rating outlook: negative
-- Stanadyne's last rating action occurred December 20, 2007
when its CFR was affirmed at B3.
Stanadyne Corporation, headquartered in Windsor, Connecticut, is a
leading designer and manufacturer of highly-engineered precision-
manufactured engine components, including fuel injection equipment
for diesel engines. Stanadyne sells engine components to original
equipment manufacturers and the aftermarket in a variety of
applications, including agricultural and construction vehicles and
equipment, industrial products, automobiles, light duty trucks and
marine equipment. Annual revenues are approximately $247 million.
STATION CASINOS: Dodges Ch 11, Gets 4th Extension From Bondholders
------------------------------------------------------------------
The Associated Press reports that Station Casinos, Inc., said that
it has secured a fourth extension from bondholders, allowing it to
continue talks for a restructuring plan and delay a bankruptcy
filing.
Tamara Audi at The Wall Street Journal relates that Station
Casinos said it expected the lenders to extend a forbearance
agreement. Station Casinos, WSJ notes, already had three previous
forbearance extensions from the lenders.
The AP relates that Station Casinos is currently proposing that
investors holding $2.3 billion in bonds exchange high-cost debt
for low-cost debt and cash so that it can enter into a Chapter 11
bankruptcy. According to The AP, Station Casinos' owners said
that they will invest $244 million in cash into the Company if the
bondholders agree to its restructuring proposal.
Station Casinos, Inc., is a gaming and entertainment company that
currently owns and operates nine major hotel/casino properties
(one of which is 50% owned) and eight smaller casino properties
(three of which are 50% owned), in the Las Vegas metropolitan
area, as well as manages a casino for a Native American tribe.
* * *
As reported by the Troubled Company Reporter on April 6, 2009,
Standard & Poor's Ratings Services said that it lowered its issue-
level rating on Station Casinos's 6% senior notes to 'D' from
'CC'. S&P also removed the rating from CreditWatch, where it was
initially placed with negative implications Dec. 16, 2008. These
actions reflect the missed April 1, 2009 interest payment on the
notes. A payment default has not occurred relative to the legal
provisions of the notes, because there is a 30-day grace period to
make the payment. However, S&P consider a default to have
occurred, even if a grace period exists, when the nonpayment is a
function of the borrower being under financial stress -- unless
S&P is confident that the company will make the payment in full
during the grace period.
As reported by the Troubled Company Reporter on February 24,
Moody's Investors Service said Station Casinos's ratings are not
affected by the announcement that it failed to make a February 15,
2009 scheduled interest payment on its 7.75% senior notes due
2016. Standard & Poor's Ratings Services lowered its issue-level
rating on Station Casinos' 7.75% senior notes to 'D' from 'CC'.
The rating action reflects the missed February 15, 2009 interest
payment on the notes.
TARRAGON CORP: Seeks Approval of KEIP for 8 Dallas Employees
------------------------------------------------------------
BankruptcyData.com reports that Tarragon Corporation has filed
with the U.S. Bankruptcy Court for the District of New Jersey a
motion seeking to implement a key employee incentive program,
pursuant to Sections 105(a), 363(b) and 503(c)(3) of the
Bankruptcy Code.
The motion states, "The Debtors' Dallas, Texas office serves as
the headquarters for the Debtors' accounting, information
technology and human resources departments. Tarragon Corp.'s
lease for that space expires in August 2009. The Debtors,
however, have not yet determined whether to continue their Dallas
operations or consolidate them with the Florida operations. The
Debtors' employees stationed in the Dallas office are aware of the
imminent expiration of the lease and repeatedly have asked
management whether their jobs are at risk. As a result of this
uncertainty, the Debtors are concerned that unless appropriate
measures, in the form of incentive payments, are taken to secure
the continued employment of the Eligible employees . . . at least
through the date on which a decision regarding the Dallas office
is made, the Eligible Employees will leave the Debtors' employ."
The motion related to eight specific employees, each of which
"possess critical knowledge of the Debtors' operations, have
performed their responsibilities since the Filing Date with
unwavering commitment and are indispensable to the Debtors'
reorganization efforts." The aggregate amount of the incentive
bonuses is approximately $100,000. The Court scheduled a June 11,
2009 hearing to consider the motion.
About Tarragon Corporation
Based in New York City, Tarragon Corporation (NasdaqGS:TARR) --
http://www.tarragoncorp.com/-- is a leading developer of
multifamily housing for rent and for sale. Tarragon's operations
are concentrated in the Northeast, Florida, Texas, and Tennessee.
Tarragon and its affiliates filed for Chapter 11 protection on
January 12, 2009 (Bankr. D. N.J. Case No. 09-10555). The Hon.
Donald H. Steckroth presides over the case.
Michael D. Sirota, Esq., Warren A. Usatine, Esq., and Felice R.
Yudkin, Esq., at Cole Schotz Meisel Forman & Leonard, P.A.,
represent the Debtor as bankruptcy counsel. Kurztman Carson
Consultants LLC serves as notice and claims agent. Daniel A.
Lowenthal, Esq., at Patterson Belknap Webb & Tyler, LLP, in New
York, represents the Official Committee of Unsecured Creditors
appointed in the case. Tarragon has said equity holders are out
of the money with regard to its bankruptcy case. As of
September 30, 2008, the Debtors had $840,688,000 in total assets
and $1,035,582,000 in total debts.
TENNECO INC: S&P Assigns 'B-' Rating on Senior Unsecured Debt
-------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its
preliminary 'B-' rating to Tenneco Inc.'s senior unsecured debt
securities filed as part of a Rule 415 unlimited amount shelf
registration. At the same time, Standard & Poor's assigned its
preliminary 'CCC' rating to Tenneco's subordinated debt
securities. Under the shelf registration, the company may sell
any combination of securities described in the prospectus up to a
total dollar amount of $500 million. S&P expects the company to
use proceeds from issuance under the shelf registration for
general corporate purposes.
The ratings on Tenneco reflect the company's vulnerable business
risk profile, given the sharp decline in light-vehicle sales and
production in North America and Europe, and highly leveraged
financial risk profile, as demonstrated by reduced cash flow
generation and tight liquidity.
Ratings List
Tenneco Inc.
Corporate credit rating B-/Negative/--
New Preliminary Ratings
Senior unsecured debt securities B-
Subordinated debt securities CCC
TEREX CORPORATION: Moody's Affirms 'B2' Corporate Family Rating
---------------------------------------------------------------
Moody's Investors Service affirmed the ratings of Terex
Corporation -- Corporate Family and Probability of Default Ratings
at B2. Terex's speculative grade liquidity rating remains SGL-3.
The outlook is changed to stable. These rating actions result
from the company's recent announcement that it amended its bank
credit facility and will be accessing the capital markets for
about $600 million.
Terex's B2 Corporate Family Rating reflects that its fundamental
business position as a manufacturer of heavy equipment for the
mining, construction, infrastructure, and energy markets remains
strong. The ratings also incorporate Moody's expectation that
Terex will be successful in accessing the capital markets under
the terms and for the amounts as announced. Terex indicated that
it is seeking approximately $600 million in new financing
consisting of $300 million in senior notes, $150 million in senior
subordinated convertible notes, and about $150 million from the
issuance of common equity. Proceeds will be used to pay down
outstanding amounts under its senior secured bank credit facility
and for general corporate purposes. Currently constraining the
rating is the severe cyclical downturn across its business
segments, which is yielding weak credit metrics.
The change in outlook to stable from negative reflects the recent
announcement that Terex achieved covenant relief under its bank
credit agreement, removing a limitation to the company's ratings.
Moody's notes that the amended financial covenants and the
resulting change in outlook are based on the company's ability to
raise about $600 million in external financing. If successful the
net cash on hand, availability under the revolving credit
facility, and significant headroom under the amended covenants
results in a liquidity profile that provides Terex with greater
financial flexibility to contend with current economic downturn.
These ratings/assessments were affected by this action:
-- Corporate Family Rating affirmed at B2;
-- Probability of Default Rating affirmed at B2;
-- $884 million secured bank credit facility (benefiting from
subsidiary guarantees) affirmed at Ba2, but its loss given
default is changed to (LGD1, 6%) from (LGD2, 11%).
-- $300 million senior subordinated notes due 2014 (benefiting
from upstream guarantees) increased to Ba3 (LGD3, 31%) from
B2 (LGD4, 57%). The higher rating on this debt instrument is
the result of a significant shift in Terex's capital
structure. The company is reducing its secured bank credit
facility by over $200 million, while adding about
$450 million of junior capital. Moreover, this junior
capital does not benefit from subsidiary guarantees and,
therefore, is structurally subordinated to the subordinated
notes due 2014.
-- Proposed $300 million senior unsecured notes due 2016
(unguaranteed) assigned a rating of B2 (LGD3, 49%).
-- $800 million senior subordinated notes due 2017
(unguaranteed) affirmed at Caa1, but its loss give default
assessment is changed to (LGD5, 81%) from (LGD5, 85%). Shelf
registrations: senior unsecured notes (P) B2; senior
subordinated notes (P) Caa1.
-- Proposed $150 million convertible subordinated notes due 2015
(unguaranteed and pari passu with the subordinated notes due
2017) assigned a rating of Caa1 (LGD5, 81%).
The company's speculative grade liquidity remains SGL-3.
The last rating action was on May 27, 2009 at which time Moody's
lowered Terex's Corporate Family Rating to B2.
Terex Corporation, headquartered in Westport, Connecticut, is a
diversified global manufacturer supporting the construction,
mining, utility and other end markets. Revenues for the last
twelve months through March 31, 2009, totaled approximately
$8.8 billion.
TERRA NOSTRA: Court Approves Disclosure Statement
-------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
has approved the disclosure statement explaining the Chapter 11
trustee's amended Chapter 11 Plan of Reorganization for Terra
Nostra Resources Corp.
All persons entitled to vote on the Plan will deliver their
ballots by mail, hand delivery, or overnight courier so as to be
received no later than 4:00 p.m. Prevailing Eastern Time on
June 22, 2009, to the Trustee at:
Stevens & Lee, P.C.
Re: Terra Nostra
Attn: Alec P. Ostrow, Esq.
Jocelyn Keynes, Esq.
485 Madison Avenue, 20th Floor
New York, NY 10022
The confirmation hearing is set for July 1, 2009, at 10:00 a.m.
Prevailing Eastern Time.
Any objections to the confirmation of the Plan must be filed with
the Clerk of the Bankruptcy Court, together with proof of service,
no later than 4:00 p.m. Prevailing Eastern Time, on June 22, 2009.
Any response to an objection to confirmation of the Plan must be
filed with the Clerk of the Bankruptcy Court no later than
4:00 p.m. Prevailing Eastern Time on June 29, 2009.
As reported in the Troubled Company Reporter on April 14, 2009,
the Plan contemplates the consummation of one of three possible
reorganization transactions to be selected by holders of allowed
general unsecured claims in Class 4:
(A) a sale of the Debtor's interest in the Chinese JVs to Zhang
Ke, a natural citizen of the PRC, or his designees, for
$27,000,000 (part of which will be used to satisfy all
priority and secured claims and expenses), payable in
installments through December 2010, and the New Common Stock
in the Reorganized Debtor issued pro rata to holders of
allowed Class 4 claims;
(B) a combined sale and restructure consisting of transferring
the Debtor's interest in SQSS and dividing STJMC into two
facilities, one of which will be transferred to Zhang Ke or
his designees, and the other of which the Reorganized Debtor
will retain a 90% interest. The Reorganized Debtor will get
$16,470,000; will make capital improvements to its facility;
and the joint venture agreements for the Chinese JV's will
be deemed rejected with no claims for damages asserted. The
Shareholder Investor Group will contribute $10,000,000 in
exchange for New Common Stock in the Reorganized Debtor, of
which $7,210,000 will be used to fund operations of the
Reorganized Debtor. $17,790,000 will be paid to the Plan
Administrator to satisfy all administrative claims, gap
period claims, priority tax claims, and the amounts
necessary to fund distributions to all claimants in Classes
1 and 3; and thereafter to fund pro rata distributions to
holders of allowed claims in Class 4; or
(C) a debt-for-equity swap with the New Common Stock in the
Reorganized Debtor issued pro rata to holders of allowed
Class 4 claims.
Irrespective of the transaction selected, the holders of allowed
general unsecured claims will receive a pro rata distribution of
the net proceeds of certain lawsuits to be pursued by the Plan
Administrator.
Holders of post-petition secured claims under Class 1 and priority
claims under Class 3 will receive 100% payment of their allowed
claims, with interest.
Holders of Interests will receive nothing under the Plan and their
interests will be cancelled.
The Plan places the various claims against and interests in the
Debtor into 5 classes:
Class Description Treatment
----- ----------- --------
1 Post-petition Secured Claims Unimpaired; Deemed to
Accept
2 Other Secured Claims Impaired; Entitled to
Vote
3 Priority Claims Unimpaired; Deemed to
Accept
4 General Unsecured Claims Impaired; Entitled to
Vote
5 Equity Impaired; Deemed to
Reject
The Trustee will request confirmation of the Plan notwithstanding
its rejection by the Class of Interests under the so-called
"cramdown" provisions of the Bankruptcy Code. Under said
provisions of the Bankruptcy Code, even if the Plan is not
accepted by all of the impaired Classes, but is accepted by at
least one impaired Class of Claims, then the Plan may still be
confirmed.
A copy of the Disclosure Statement explaining the Trustee's
amended Chapter 11 Plan of Reorganization is available for free at
http://bankrupt.com/misc/terranostra.amendedDS.pdf
Headquartered in Pasadena, California, Terra Nostra Resources
Corp. (OTCBB: TNRO) owns a 51% interest in two China Joint Venture
companies in the strategic copper and stainless steel industries.
Creditors filed an involuntary Chapter 11 petition on November 25,
2008 (Bankr. S.D. N.Y. Case No. 08-14708).
Davud C. McGrail, Esq., at the Law Offices of David C. McGrail,
represents the Debtor as counsel. Karen Ostad, Esq., at Morrison
& Foerster LLP, represents the petitioning creditors.
TIERRA DEL SOL: Files for Chapter 11 Bankruptcy Protection
----------------------------------------------------------
Eloisa Ruano Gonzalez at Orlando Sentinel reports that Tierra Del
Sol Resort Inc. has filed for Chapter 11 bankruptcy protection in
the U.S. Bankruptcy Court for the Middle District of Florida.
Orlando Sentinel relates that British investors who paid Tierra
Del Sol thousands to build vacation homes sued the Company after
it stopped construction due to lack of money. Orlando Sentinel
relates that Tierra Del Sol officials blamed the cash shortfall on
the housing slump, an expansion of the resort's water park, and
the costs of filing plan modifications with Polk County
government.
According to Orlando Sentinel, Tierra Del Sol hopes that its
bankruptcy filing would help it resume construction of the houses
and pay off its debts, which total $184 million. R. Scott Shuker,
Esq., at Latham Shuker Eden & Beaudine LLP, who assists Tierra Del
Sol in its restructuring efforts, said that once construction
restarts, the Company would finish building the units and sell
them to repay creditors, Orland Sentinel states. Orlando Sentinel
relates that if Tierra Del Sol can secure a loan, it will build a
100,000-square-foot clubhouse with restaurants and shops, as
featured in its original plans, in three to four years.
Orlando Sentinel notes that about 96 town houses have been
completed and prepared for occupancy, and of the 972 units planned
for the site, about 370 have purchase contracts but haven't gone
to closings.
Tierra Del Sol listed $100,000,001 to $500,000,000 in assets,
court documents say.
Orlando, Florida-based Tierra Del Sol Resort, Inc., is a developer
in the Four Corners area near Walt Disney World.
TOYS R US: Acquires FAO Schwarz, To Takeover Fifth Avenue Store
---------------------------------------------------------------
Toys "R" Us, Inc., has acquired FAO Schwarz.
Jerry Storch, Chairman and CEO, Toys "R" Us, Inc., said, "We will
work tirelessly to preserve the distinctiveness and integrity of
the FAO Schwarz stores and brand as we grow the business and,
indeed, take the brand to even greater heights."
Following the acquisition, Toys "R" Us, Inc., will continue to
operate the two FAO Schwarz retail stores -- the flagship location
in New York City and a store at the Forum Shops at Caesars Palace
in Las Vegas. In addition, the company will operate the FAO
Schwarz e-commerce and catalog operations. Each of these
businesses will continue to operate under the legendary FAO
Schwarz name. All merchandising, management, distribution and
marketing operations will immediately begin to transition to Toys
"R" Us, Inc. Other terms of the transaction were not disclosed.
"This acquisition allows us to grow our toy specialist market
share and draw upon the unique strengths of both brands in
developing quality products that differentiate us from our mass
market competitors," Mr. Storch stated. "To that end, we look
forward to working together with the expanded universe of
respected FAO Schwarz manufacturers and other valued partners,
while developing innovative and quality product offerings. We are
committed to providing the loyal clientele of FAO Schwarz with the
unique shopping experience they have come to expect."
Toys "R" Us will offer employment opportunities to FAO Schwarz
associates in the New York and Las Vegas stores.
Toys "R" Us currently operates stores in 33 countries worldwide,
offering its customers a differentiated merchandise assortment and
a first-to-market experience with the hottest new toys. The
acquisition of FAO Schwarz further advances the company's toy
authority position and broadens its growing portfolio of family-
friendly brands. Earlier this year, Toys "R" Us expanded its
online brand offerings through the acquisition of the highly
regarded eToys.com, babyuniverse.com, Toys.com, and parenting
resource site, ePregnancy.com.
Macy's Inc. spokesperson Jim Sluzewski said that the company is
disappointed that Toys "R" Us terminating a program to operate FAO
Schwarz's outlets in hundreds of Macy's stores, Karen Talley at
Dow Jones Newswires relates. Dow Jones states that FAO Schwarz
operates in 260 Macy's stores and will be closing these outlets
before the important holiday shopping season. Citing Mr.
Sluzewski, Dow Jones says that plans to outfit another 400 Macy's
stores are ruined.
Dow Jones notes that other inventory will be put in the locations
when retailers are having a hard time moving what they already
have.
About Toys R Us
Based in Wayne, New Jersey, Toys R Us sells toys, baby-juvenile
products and children's apparel worldwide. Toys "R" Us - Domestic
provides toy and juvenile product offerings in 49 states and
Puerto Rico and sells merchandise through Internet sites; and Toys
"R" Us - International operates, licenses or franchises stores in
33 foreign countries. As of November 1, 2008, there were 1,546
wholly owned and franchised "R" Us branded retail stores
worldwide.
* * *
As reported by the Troubled Company Reporter on December 19,
Standard & Poor's Ratings Services revised its outlook on Toys "R"
Us Inc. to negative from stable. S&P affirmed all the ratings
on the Wayne, New Jersey-based company, including the 'B'
corporate credit rating. S&P has also affirmed the debt issued by
subsidiaries Toys "R" Us Delaware Inc. and U.S. Propco. "The
outlook revision reflects our belief that Toys will be more
challenged than previously anticipated in the important fourth
quarter of 2008 and early 2009," said Standard & Poor's credit
analyst Ana Lai, "due to a deepening spending pull-back by
consumers in the current weak U.S. economic environment." Credit
protection measures will likely deteriorate to levels that are
weak for the rating.
TREY RESOURCES: Buys 20% of SWK Technologies Stock for $150,000
---------------------------------------------------------------
Trey Resources Inc. disclosed in a filing with the Securities and
Exchange Commission that on May 6, 2009, the Company entered into
a Securities Purchase Agreement with SWK Technologies, Inc., a
subsidiary of the Company, Jeffrey D. Roth and Jerome R. Mahoney
whereby SWK sold 25 common stock shares or 20% of the stock of
SWK, for a purchase price of $150,000. The $150,000 paid to SWK
Technologies, Inc., was transferred to the Company as a management
fee.
A full-text copy of the Securities Purchase Agreement is available
for free at http://ResearchArchives.com/t/s?3d53
In conjunction with the Securities Purchase Agreement, the Company
entered into a Termination and Settlement Agreement with SWK
Technologies, Inc., Jeffrey D. Roth and Jerome R. Mahoney.
Pursuant to the Termination and Settlement Agreement, upon receipt
of the $150,000 transferred by SWK pursuant to the Securities
Purchase Agreement, the Company paid Jerome R. Mahoney, the
Company's non-executive chairman of the board of directors since
January 1, 2003, the sum of $117,500 in full and total
satisfaction on any and all outstanding obligations that exist or
may exist between Mr. Mahoney and Trey Resources, Inc. The total
outstanding debt due to Mr. Mahoney was approximately $1,210,000.
Additionally, Mr. Mahoney resigned as an officer, director and
employee of the Company and SWK. Messrs. Mahoney and Roth and the
Company and SWK exchanged releases.
A full-text copy of the Termination and Settlement Agreement is
available for free at http://ResearchArchives.com/t/s?3d54
About Trey Resources
Headquartered in Livingston, New Jersey, Trey Resources Inc.
(OTC BB: TYRIA) -- http://www.treyresources.com/-- operates as a
business consultant, value-added reseller, and developer of
financial accounting software to small and medium-sized businesses
in the United States. It also publishes its own proprietary
electronic data interchange software, MAPADOC, which is used to
automate existing processes.
Trey Resources Inc.'s balance sheet at September 30, 2008, showed
total assets of $$1,502,051 and total liabilities of $7,139,741,
resulting in a stockholders' deficit of $5,637,690.
Going Concern Doubt
Bagell, Josephs, Levine & Company, LLC, in Marlton, New Jersey,
expressed substantial doubt about Trey Resources Inc.'s ability to
continue as a going concern after auditing the company's
consolidated financial statements for the years ended December 31,
2007, and 2006. The auditing firm pointed to the company's
substantial accumulated deficits and operating losses.
TRINITY INDUSTRIES: S&P Gives Stable Outlook; Affirms 'BB+' Rating
------------------------------------------------------------------
Standard & Poor's Ratings Services revised its rating outlook on
Trinity Industries Inc. to stable from positive. S&P affirmed its
ratings on the company, including the 'BB+' long-term corporate
credit rating.
"The outlook revision reflects deteriorating end-market conditions
and expected weakening of credit measures," said Standard & Poor's
credit analyst Robyn Shapiro. The company is exposed to the
highly cyclical new railcar manufacturing sector which has seen
significant demand declines because of the global economic
downturn. Still, Trinity benefits from more stable leasing cash
flow generation and good credit measures entering the downturn.
The ratings on Dallas-based Trinity Industries Inc. reflect the
company's significant financial risk profile and satisfactory
business risk profile.
Trinity provides products and services to the transportation,
industrial, energy and construction sectors. The company is the
largest producer of railcars, railcar axles, and coupling devices
in North America. The rail business accounts for 32% of sales,
construction products accounts for 18%, leasing and management
services 17%, energy equipment 16%, and inland barge 17%.
Since 2001, debt at Trinity Industries Leasing Co. has increased
substantially due to the intensive amounts of capital required to
increase its lease fleet. Still, long-term leases with
creditworthy customers create a relatively predictable source of
cash flow. The company continues to borrow to fund leasing-
related capital expenditures, although its leverage levels are
comparable with other railcar lessors. For the rating, Standard &
Poor's Rating Services expects Trinity to maintain its leasing-
related leverage ratio to no more than 75% debt to capital.
Credit protection measures at the company's manufacturing
operations have remained strong recently; however, S&P expects
these measures to deteriorate significantly because of continued
declining demand in end markets. As of March 31, 2009, total debt
to EBITDA (adjusted for the capitalization of operating leases and
postretirement obligations) was about 1x and funds from operations
to total debt was about 80%. For the rating, S&P expects FFO to
adjusted debt of about 25%.
While the railcar production environment is likely to remain weak
in 2009 and 2010, Trinity's strong market share and diversity of
operations in railcar leasing, energy equipment, and barge
manufacturing should allow it to maintain good performance to
support the ratings. S&P would consider an outlook revision to
negative or a downgrade if, for example, weak market conditions or
a more aggressive-than-expected financial policy stretch credit
metrics, causing FFO to debt to decline to less than 25% for a
sustained period. Given the current weak economic environment,
S&P does not foresee a positive rating action in the near term.
TRONOX INC: Seeks to Retain ATL as Property Tax Consultant
----------------------------------------------------------
BankruptcyData.com reports that Tronox Inc. has sought the
approval of the U.S. Bankruptcy Court for the Southern District of
New York for the retention of Assessment Technologies. Ltd. as
property tax consultant, nunc pro tunc to February 3, 2009.
In consideration of the property tax consulting services to be
provided by ATL, Tronox will pay ATL on a contingency basis, 30%
or 35% -- in accordance with the agreed upon "expense level" -- of
all of the tax savings received by Tronox, less reimbursement of
Assessment Technology's expenses, which will include all special
property tax counsel legal fees, third party appraisal fees and
any other reasonable fees incurred by ATL in pursuing tax savings
for Tronox under the service agreement.
About Tronox Inc.
Headquartered in Oklahoma City, Tronox Incorporated (Pink Sheets:
TRXAQ, TRXBQ) is the world's fourth-largest producer and marketer
of titanium dioxide pigment, with an annual production capacity of
535,000 tonnes. Titanium dioxide pigment is an inorganic white
pigment used in paint, coatings, plastics, paper and many other
everyday products. The Company's four pigment plants, which are
located in the United States, Australia and the Netherlands,
supply high-performance products to approximately 1,100 customers
in 100 countries. In addition, Tronox produces electrolytic
products, including sodium chlorate, electrolytic manganese
dioxide, boron trichloride, elemental boron and lithium manganese
oxide.
Tronox has $1.6 billion in total assets, including $646.9 million
in current assets, as at September 30, 2008. The Company has
$881.6 million in current debts and $355.9 million in total
noncurrent debts.
Tronox Inc., aka New-Co Chemical, Inc., and 14 other affiliates
filed for Chapter 11 protection on January 13, 2009 (Bankr. S.D.
N.Y. Case No. 09-10156). The case is before Hon. Allan L.
Gropper. Richard M. Cieri, Esq., Jonathan S. Henes, Esq., and
Colin M. Adams, Esq., at Kirkland & Ellis LLP in New York,
represent the Debtors. The Debtors also tapped Togut, Segal &
Segal LLP as conflicts counsel; Rothschild Inc. as investment
bankers; Alvarez & Marsal North America LLC, as restructuring
consultants; and Kurtzman Carson Consultants serves as notice and
claims agent.
An official committee of unsecured creditors and an official
committee of equity security holders have been appointed in the
cases. The Creditors Committee has retained Paul, Weiss, Rifkind,
Wharton & Garrison LLP as counsel.
Until September 30, 2008, Tronox Inc. was publicly traded on the
New York Stock Exchange under the symbols TRX and TRX.B. Since
then, Tronox Inc. has traded on the Over the Counter Bulletin
Board under the symbols TROX.A.PK and TROX.B.PK. As of
December 31, 2008, Tronox Inc. had 19,107,367 outstanding shares
of class A common stock and 22,889,431 outstanding shares of
class B common stock.
Bankruptcy Creditors' Service, Inc., publishes Tronox Bankruptcy
News. The newsletter tracks the Chapter 11 proceeding undertaken
by Tronox Inc. and its 14 affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
VERSO PAPER: S&P Downgrades Corporate Credit Rating to 'B-'
-----------------------------------------------------------
Standard & Poor's Ratings Services said that it lowered its
ratings on Memphis, Tennessee-based coated-paper manufacturer
Verso Paper Holdings LLC. The corporate credit rating was lowered
to 'B-' from 'B'. S&P removed the ratings from CreditWatch, where
they were placed with negative implications on March 12, 2009.
The outlook is negative.
At the same time, S&P assigned a 'B+' issue rating and a '1'
recovery rating to the proposed $325 million senior secured notes
due 2014 to be issued by Verso Escrow LLC, a wholly owned
subsidiary of Verso Paper, based on preliminary terms and
conditions. Verso Paper Finance Holdings One LLC, the indirect
parent of Verso Paper, will guarantee the proposed notes and it
expects to sell the notes pursuant to Rule 144A of the U.S.
Securities Act of 1933. Upon meeting certain conditions, Verso
Paper will assume the notes. Verso Paper will use proceeds from
the proposed offering to repay the term loan outstanding under the
company's senior secured credit facilities.
"The downgrade reflects our expectation that the steep decline in
demand for coated paper in the U.S. and its impact on Verso's
revenues and profitability will be more significant than S&P
previously anticipated," said Standard & Poor's credit analyst
Andy Sookram. "As a result, the company's total adjusted leverage
will likely increase to well above 10x, a level that S&P would
consider to not be consistent with the previous 'B' rating."
Still, S&P expects that Verso's liquidity profile will remain
adequate for its 'B-' rating in the near-term, with pro forma
revolver availability of around $100 million, a lack of meaningful
debt maturities until 2012, and the expected elimination of
maintenance covenants governing its credit facility (the company
is in the process of securing an amendment to the secured credit
facilities). In addition, S&P expects cash balances to increase
as 2009 progresses due to payments received under alternative-
fuel-mix tax credits. Verso Paper is likely to end the year with
cash of more than $100 million.
The downgrade incorporates S&P's current expectations that in 2009
revenues could decline by about 25% to about $1.3 billion; EBITDA
could decline more than 50% compared to 2008 (despite moderating
input costs and some benefits from cost savings initiatives);
EBITDA coverage of cash interest expense will fall to around 1x;
and total adjusted leverage will rise to close to 15x. These
declines reflect the impact that the lingering recession in the
U.S. will continue to have on demand for coated paper due to lower
advertising spending and a significant reduction in orders by
printers and publishers. In addition, prices have declined
despite major coated paper manufacturers curtailing production to
match supply with the lower demand levels, a trend S&P expects to
continue in the near term. While S&P does expect that the U.S.
economy will begin to recover during the latter part of 2009,
likely driving increased demand for coated paper, S&P currently
expect this increase to be more moderate.
Verso is the second-largest coated paper manufacturer in North
America and accounts for about 15% of total production capacity.
Ratings reflect the company's highly leveraged capital structure,
participation in the cyclical and highly competitive coated paper
market, limited product and geographic diversity, and some
customer concentration.
VIANT HOLDINGS: S&P Affirms Counterparty Credit Rating at 'B'
-------------------------------------------------------------
Standard & Poor's Ratings Services said that it affirmed its 'B'
counterparty credit rating on Viant Holdings Inc.
Standard & Poor's also said that the outlook on Viant remains
stable.
At the same time, Standard & Poor's affirmed its 'B+' ratings on
Viant's senior secured credit facilities, which consist of a
$50 million revolving credit facility due 2013 and a $275 million
term loan B due 2014. The recovery ratings on these senior
secured credit facilities are unchanged at '2', which indicate
substantial (70%-90%) recovery in the event of a payment default.
S&P also affirmed its 'CCC+' debt rating on Viant's $180 million
10.125% senior subordinated notes due 2017 and assigned it a
recovery rating of '6', which indicates negligible (0%-10%)
recovery in the event of a payment default.
The rating on Viant is based on its stable competitive position in
the health care cost-management services industry, success in
operating as a stand-alone entity since 2007, and good operating
margins for the rating category. Offsetting these strengths,
Viant's limited product scope and key customer concentrations
weaken its business profile, and aggressive debt leverage and a
high level of goodwill and intangibles weaken balance-sheet
quality.
Viant is a national provider of outsourced cost-management
services to the managed care industry. The company generates
transaction and savings-based revenues by providing health care
payors with services such as primary and complementary access to
its discounted provider contracts, network management services,
and post-payment audit services. The company's services appeal to
a broad range of health care payors, including managed care
companies, third-party administrators, BlueCross BlueShield
organizations, Taft-Hartley sponsored plans, and government
agencies.
Viant's limited product scope and customer concentrations are key
rating constraints. The company's revenue base remains heavily
dependent on its network-based services, particularly its primary
and supplemental PPO network coverage services. To the extent
that managed care companies consolidate or insource various cost-
management services, Viant's revenue base would be at risk, and
its customer base would potentially become even more concentrated.
In 2008, Viant's top 10 clients contributed 56% of its full-year
revenues, and the top three clients contributed more than 40% of
revenues. Notwithstanding this risk, the company's client
retention has not been a major issue historically.
For full-year 2009, S&P projects that Viant will generate total
revenues of $240 million-$250 million and EBITDA of at least
$90 million. Debt-to-EBITDA will likely improve to less than 5x
by year-end 2009, while EBITDA interest coverage will improve to
more than 2.5x. In 2009, S&P expects that a new client contract
will help drive continued growth in network services revenue,
though the full-year effect of the loss of CMS revenue will offset
the gain. Viant did not win any primary regional contracts as
part of CMS's 10-year Recovery Audit Contractor expansion project.
However, it did enter into a subcontracting relationship with one
of the primary regional contractors, for which revenues will kick
in starting in 2010.
Over the next several years, Viant's aggressive debt leverage and
acquisition-based growth strategy will constrain its liquidity.
In addition, if the company's earnings were to decline materially
and Viant were to breach its credit facilities covenants,
liquidity could become an immediate concern if debt becomes
payable. Nevertheless, good operating cash flow and the maturity
structure of the debt adequately support liquidity. Moreover, S&P
considers the company's amount of planned capital expenditures
over the next several years to be relatively modest.
"A rating action or outlook revision on Viant is unlikely over the
next 12 months," noted Standard & Poor's credit analyst James
Sung. "However, S&P would consider revising the outlook to
positive in 2010 if the company's business fundamentals improve
and its key credit metrics support a higher rating." At the same
time, S&P has longer-term concerns that various potential industry
trends -- such as further consolidation within the managed care
industry, managed care companies handling cost-management services
internally, and a broad-based movement away from fee-for-service-
based provider compensation -- could hurt the company's business
profile.
VISTEON CORP: Chapter 11 Filing Cues Fitch's 'D' Rating
-------------------------------------------------------
Fitch Ratings has downgraded Visteon's Issuer Default Rating to
'D' from 'C' based on the company's filing for Chapter 11
bankruptcy.
Existing ratings on Visteon remain:
-- Senior secured term loan 'C/RR4';
-- Senior unsecured notes 'C/RR6'.
Furthermore, Fitch affirms the ABL facility's 'B-/RR1' rating and
simultaneously withdraws the rating based on Ford becoming the ABL
lender prior to bankruptcy.
Fitch expects that the asset-based lending facility will achieve
full recovery based on collateral coverage. Availability under
the facility has been reduced in line with declining collateral
values (receivables, inventories and certain domestic PP&E)
thereby providing protection to outstanding loans. Secured term
loan holders are expected to recover only 31%-50% of face values
as the lack of financial covenants provided little protection for
lenders during the recent past as Visteon and the industry
experienced deep financial stress, a steep decline in operating
performance, and a drop in asset values. The senior unsecured
notes are forecasted to have very little recovery, which is
projected to be in the range of 0%-10%.
Recovery is based on a liquidation scenario as Fitch believes that
some of Visteon's domestic operations will be dismantled. A large
portion of recovery values is expected to arise from overseas
equity holdings, although these values have also declined in line
with the global automotive production downturn. Recovery values
are also expected to be affected by other non-debt, on- and off-
balance sheet claimants such as the PBGC and the UAW.
VISTEON CORP: Chapter 11 Filing Cues Moody's 'D' Rating
-------------------------------------------------------
Moody's Investors Service lowered Visteon Corporation's
Probability of Default to D from Caa3 and Corporate Family Rating
to C from Ca. In a related action Moody's also lowered the
ratings of Visteon's senior secured term loan to Ca from Caa2, and
guaranteed senior unsecured notes to C from Ca.
The lowered ratings reflect the filing for Chapter 11 protection
by Visteon of its U.S. subsidiaries on May 27, 2009. Visteon
announced that it expects to fund its operations with its U.S.
cash balance, cash flows from operations and a debtor-in-
possession facility. Visteon also announced that Ford Motor
Company has executed a commitment letter to support debtor-in-
possession financing for Visteon's restructuring efforts and to
ensure long-term continuity of supply.
Consistent with Moody's Withdrawal Policy, Moody's will withdraw
the ratings of Visteon.
Ratings lowered:
Visteon Corporation
-- Probability of Default, to D from Caa3;
-- Corporate Family Rating, to C from Ca;
-- Secured bank term loan, to Ca (LGD4, 56%) from Caa2 (LGD3,
36%);
-- Guaranteed senior unsecured notes (privately placed without
registration rights) due 2016, to C (LGD6, 96%) from Caa3
(LGD5, 82%);
Ratings Affirmed:
-- Unguaranteed Unsecured notes, of C (LGD6, 100%);
-- Speculative Grade Liquidity rating, of SGL--4
Visteon's revolving credit facility is not rated by Moody's.
The last rating action was on March 26, 2009 when the Probability
of Default Rating was lowered to Caa3.
Visteon Corporation, headquartered in Van Buren Township,
Michigan, is a global tier 1 automotive supplier focused on
climate control systems, electronic/lighting products and
interiors. Annual product revenues were $9.1 billion in 2008.
The Company has operations in 27 countries.
VISTEON CORP: S&P Downgrades Corporate Credit Rating to 'D'
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Van Buren Township, Michigan-based Visteon Corp. to 'D'
and lowered various issue-level ratings.
The rating actions were prompted by Visteon filing for Chapter 11
bankruptcy protection on May 28, 2009, in Delaware. Ford Motor
Co., the company's largest customer, has executed a commitment
letter to provide debtor-in-possession financing for Visteon.
"We believe the filing was prompted by the company's heavy debt
burden and a sharp decline in liquidity caused by severe
automotive production declines in the North America and
elsewhere," Standard & Poor's credit analyst Robert Schulz said.
Pending further information from the bankruptcy proceedings, the
recovery ratings remain unchanged. Visteon reported approximately
$2.7 billion of balance sheet debt as of March 31, 2009.
VISTEON CORP: Court Grants Interim Okay to Use Cash Collateral
--------------------------------------------------------------
Visteon Corporation and its debtor-affiliates aver that they need
immediate access to the cash collateral of their Prepetition
Lenders in order to continue the operations of their business;
maintain business relationships with vendors, suppliers and
customers; pay employees; and satisfy other working capital and
operational needs.
"Absent authority to use Cash Collateral immediately, the
Debtors' ability to maximize the value of their global enterprise
estates would be jeopardized and the Debtors would be forced to
undertake a liquidation of their business to the direct detriment
of all parties-in-interest, causing immediate, substantial and
irreparable harm," James E. O'Neill, Esq., at Pachulski Stang
Ziehl & Jones LLP, in Wilmington, Delaware, proposed attorney for
the Debtors, asserts.
As of the Petition Date, the Debtors had approximately
$200,000,000 of cash on hand and in accounts, which comprises
Cash Collateral, according to Mr. O'Neill.
By this motion, the Debtors seek interim authority from the Court
to allow them to use the Cash Collateral for their ordinary
course operations, pursuant to Sections 361 and 363 of the
Bankruptcy Code.
In this light, the Debtors prepared a budget for the five-week
period from the week ended June 5, 2009, through the week ended
July 3, 2009. The Debtors maintain that under the cash flow
forecast, cash will be sufficient to operate their business
during the interim period. A copy of the Budget for the 5-week
period ending on July 3, 2009, is available for free at:
http://bankrupt.com/misc/Visteon_CashCollBudget.pdf
Moreover, the Debtors seek to provide adequate protection provided
to certain secured lenders in relation to their use of the Cash
Collateral.
Prepetition Credit Facilities
As of May 28, 2009, the Company had approximately $2.7 billion of
outstanding debt on a consolidated basis:
-- $1.5 billion of loans under a Senior Term Loan;
-- $89 million of draws under a Revolving Facility;
-- $862 million of unsecured U.S. bond debt; and
-- $215 million of debt on account of other credit facilities,
capital leases for affiliates, swaps, and other
miscellaneous obligations.
Visteon's principal debt obligations are composed of:
A. Senior Secured Term Loan and ABL Revolver Loan
In April 2007, Visteon, as borrower, entered into a Term
Loan Facility with certain lenders and JPMorgan Chase Bank,
N.A., as administrative agent. The Term Loan Lenders
agreed to make certain loans to Visteon, including a $1.5
billion senior secured term loan. The Senior Term Loan
bears interest at a rate per annum equal to the Eurodollar
rate plus 3.00%, until the final maturity date of Dec. 13,
2013.
Visteon also has two variable to fixed interest rate swap
obligations related to $100 million of the term loan debt.
On August 14, 2006, Visteon, as borrower, also entered into
an ABL Revolver Loan of up to $350 million with JPMorgan
Chase Bank, N.A., as administrative agent, and certain
lenders. The Facility also includes a letter of credit
subfacility of up to $250 million.
To secure its obligations under the Term Facility and the
Revolver Facility, Visteon granted to Lenders (a) a first
priority lien on certain assets of its and certain of its
foreign subsidiaries, intellectual property, foreign
intercompany debt owed to Visteon and its domestic
subsidiaries; and (b) a second priority lien on all other
Visteon assets and most of those of its domestic
subsidiaries.
Effective March 31, 2009, Visteon entered into limited
waivers to the Term Facility and the Revolver Facility with
respect to potential defaults until May 30, 2009. As
consideration for the limited waiver, Visteon agreed to
complete certain collateral disclosure and perfection
matters within certain periods following effectiveness of
the waiver.
From May 13 to 21, 2009, Visteon entered into three
amendments of the Revolver Loan Facility. Among others,
under the amendments, (1) the administrative agent is not
obliged to issue new letters of credit after May 1, 2009;
(2) Ford took an assignment of all of the outstanding
loans, obligations, and other interests of the lenders
under the Revolver Facility; and (3) the minimum liquidity
covenant is reduced from $264 million to $210 million.
B. Unsecured Bond Debt
Visteon issued these notes:
Principal
Notes Indenture Trustee Amount
----- ----------------- ------------
8.25% Senior Notes Bank One Trust
Due August 1, 2010 Company, N.A. $700 million
7% Senior Notes JP Morgan Trust
Due March 10,2014 Company N.A. $450 million
12.25% Senior Notes Bank One New York
Due December 31, 2016 Trust Company N.A. $206.4 million
C. European Securitization Facility
In August 2006, Visteon established its European accounts
Receivable securitization facility, which extends through
August 2011. Under the European Securitization Facility,
account receivables originating from certain Visteon
subsidiaries in Germany, Portugal, Spain, France, and
Ireland are sold to Visteon Financial Centre P.L.C., a
bankruptcy-remote special purpose entity incorporated in
Ireland, in exchange for cash. Financial Centre funds the
purchase of receivables through: (a) the issuance of
receivables-backed, variable loan notes to third-party
lenders who in turn lend cash at a discount to the notes;
and (b) the issuance of subordinated notes to Visteon
Netherlands Finance BV who lends cash, on a subordinated
basis, to make up the balance of the purchase price that is
not funded by third-party debt. As amended on March 31,
2009, the European Securitization Facility provided up to
$200 million in third-party funding to participating
entities with the amount available depending on the amount
of trade receivables sold to Financial Centre, less
outstanding borrowings.
Immediately prior to the Petition Date, termination notices
were delivered by Visteon for the termination of the
European Securitization Facility.
D. Common Stock
Visteon is a publicly-traded company previously listed on
the New York Stock Exchange under the symbol VC. On
March 4,2009, the NYSE notified the Company that its common
stock would be delisted from the NYSE and trading in
Visteon's common stock would be suspended for trading
effective March 6, 2009. Since March 6 and through the
Petition Date, Visteon's common stock traded on the over-
the-counter market, also known as the "Pink Sheets," under
the symbol VSTN. At the close of market on May 22, 2009,
Visteon had approximately 130 million shares of common
stock outstanding with a market capitalization of
approximately $35.8 million.
To secure their Prepetition Obligations under the ABL Facility
and the Term Loan Facility, the Debtors granted to the
Prepetition Lenders (1) a first priority lien on certain of
Visteon assets and (2) a second priority lien on the remaining
Visteon assets.
The Term Lenders and the Revolver Lenders are also parties to an
Intercreditor Agreement dated June 13, 2006, among the
Prepetition ABL Agent, the predecessor to the Prepetition Term
agent, and certain of the Debtors. Under the Intercreditor
Agreement provides that in the context of a Chapter 11 case, the
Prepetition ABL Lenders consent to the use of cash collateral or
to provide postpetition financing secured by the ABL Priority
Collateral, the Prepetition Term Lenders will be deemed to have
consented to cash collateral use or financing and will heave no
right to seek adequate protection or relief in connection with
the cash collateral use or financing.
The Debtors' cash, including all cash and other amounts on
deposit maintained in any account subject to "control" in favor
of the Prepetition Lenders are referred to as "Cash Collateral."
Accordingly, the Debtors propose to provide the Prepetition ABL
Lenders with three primary forms of adequate protection to the
extent of any diminution in value of the ABL Lenders' interest in
the Prepetition ABL Collateral:
1. Adequate protection liens on all of the Debtors' rights,
title and interest to all of the Debtors' property and
proceeds, subject to the Carve-Out.
2. Superpriority claim against each of the Debtors to the
extent provided by Section 207(b) of the Bankruptcy Code,
subject to the Carve-Out.
3. Adequate protection payments, including payment of interest
on the Prepetition ABL Obligations and payment of fees and
expenses of the Prepetition ABL Lenders.
Moreover, despite the Prepetition Term Lenders' deemed consent
and waiver, the Debtors seek to provide those Term Lenders
adequate protection in the form of replacement liens.
Carve Out refers to the sum of (i) all unpaid fees to the Court
Clerk and to the U.S. Trustee; (ii) fees and expenses up to
$25,000 incurred by a trustee under Section 726(b) of the
Bankruptcy Code; (iii) to the extent allowed, all unpaid fees and
expenses incurred by persons or firms retained by the Debtors
pursuant to Sections 327 Bankruptcy Code; (iii) after the
delivery of a Carve Out Trigger Notice, to the extent allowed,
the payment of professional fees of up to $10,000,000.
The Debtors also ask the Court to schedule a final hearing on its
Cash Collateral Use request.
Court Grants Interim Approval
Visteon Corporation disclosed in a press release that the U.S.
Bankruptcy Court for the District of Delaware granted interim
approval for the company to use certain cash collateral to
continue operations in the ordinary course of business.
A hearing for final approval of certain of the First Day Motions
has been scheduled for June 19, 2009, at 1 p.m.
About Visteon Corp.
Headquartered in Van Buren Township, Michigan, Visteon Corporation
(NYSE: VC) -- http://www.visteon.com/-- is a global automotive
supplier that designs, engineers and manufactures innovative
climate, interior, electronic and lighting products for vehicle
manufacturers, and also provides a range of products and services
to aftermarket customers. The company has corporate offices in
Van Buren Township, Michigan (U.S.); Shanghai, China; and Kerpen,
Germany. It has facilities in 27 countries and employs roughly
35,500 people. The Company has assets of $4,561,000,000 and debts
of $5,311,000,000 as of March 31, 2009.
Visteon Corp. and 30 of its affiliates filed for Chapter 11
protection on May 28, 2009, (Bank. D. Del. Case No. 09-11786
through 09-11818). Judge Christopher S. Sontchi oversees the
Chapter 11 cases. James H.M. Sprayregen, Esq., Marc Kieselstein,
Esq., and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in
Chicago, Illinois, represent the Debtors in their restructuring
efforts. Laura Davis Jones, Esq., James E. O'Neill, Esq., Timothy
P. Cairns, Esq., and Mark M. Billion, Esq., at Pachulski Stang
Ziehl & Jones LLP, in Wilmington, Delaware, serve as the Debtors'
local counsel. The Debtors' investment banker and financial
advisor is Rothschild Inc. The Debtors' notice, claims, and
solicitation agent is Kurtzman Carson Consultants LLC. The
Debtors' restructuring advisor is Alvarez & Marsal North America,
LLC.
Bankruptcy Creditors' Service, Inc., publishes Visteon Bankruptcy
News. The newsletter tracks the Chapter 11 proceedings of Visteon
Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/
or 215/945-7000)
VISTEON CORP: Seeks to Employ Pachulski Stang as Local Counsel
--------------------------------------------------------------
Visteon Corporation and its debtor-affiliates seek authority from
the U.S. Bankruptcy Court for the District of Delaware to employ
Pachulski Stang Ziehl & Jones LLP as their co-counsel nunc pro
tunc to May 28, 2009, pursuant to Section 327(a) of the Bankruptcy
Code.
The Debtors have selected Pachulski Stang because of the firm's
extensive experience and knowledge in the field of debtors' and
creditors' rights and business reorganizations under Chapter 11
of the Bankruptcy Code. William G. Quigley, III, chief financial
officer and executive vice president of Visteon Corporation, says
that in preparing for their representation of the Debtors,
Pachulski Stang has become familiar with the Debtors' affairs and
many of the potential legal issues which may arise.
As co-counsel to the Debtors, Pachulski Stang will:
(a) provide legal advice with respect to the Debtors' powers
and duties as debtors-in-possession in the continued
operation of their businesses and management of their
property;
(b) prepare on behalf of the Debtors any necessary
applications, motions, answers, orders, reports, and other
legal papers;
(c) appear in Court on behalf of the Debtors;
(d) prepare and pursue confirmation of a Chapter 11 plan of
reorganization and approval of a disclosure statement; and
(e) perform other legal services for the Debtors that may be
necessary and proper in the proceedings.
The Debtors propose to pay Pachulski Stang for the firm's
services on an hourly basis, and reimburse the firm of its
actual, necessary expenses and other charges. The principal
attorneys and paralegals presently designated to represent the
Debtors and their current standard hourly rates are:
Professional Rate/Hour
------------ ---------
Laura Davis Jones $795
James E. O'Neill $535
Timothy P. Cairns $395
Mark M. Billion $325
Karina Yee $215
Mr. Quigley relates that prior to the Petition Date, the Debtors
have paid Pachulski Stang $132,209 in connection with the firm's
prepetition representation of the Debtors. Pachulski Stang has
not yet completed a final reconciliation of its prepetition fees
and expenses. Upon final reconciliation of the amount actually
expended prepetition, any balance remaining from the prepetition
payments to the firm will be credited to the Debtors and utilized
as Pachulski Stang's retainer to apply to postpetition fees and
expenses, Mr. Quigley tells the Court.
Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, in
Wilmington, Delaware, assures the Court that her firm is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
About Visteon Corp.
Headquartered in Van Buren Township, Michigan, Visteon Corporation
(NYSE: VC) -- http://www.visteon.com/-- is a global automotive
supplier that designs, engineers and manufactures innovative
climate, interior, electronic and lighting products for vehicle
manufacturers, and also provides a range of products and services
to aftermarket customers. The company has corporate offices in
Van Buren Township, Michigan (U.S.); Shanghai, China; and Kerpen,
Germany. It has facilities in 27 countries and employs roughly
35,500 people. The Company has assets of $4,561,000,000 and debts
of $5,311,000,000 as of March 31, 2009.
Visteon Corp. and 30 of its affiliates filed for Chapter 11
protection on May 28, 2009, (Bank. D. Del. Case No. 09-11786
through 09-11818). Judge Christopher S. Sontchi oversees the
Chapter 11 cases. James H.M. Sprayregen, Esq., Marc Kieselstein,
Esq., and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in
Chicago, Illinois, represent the Debtors in their restructuring
efforts. Laura Davis Jones, Esq., James E. O'Neill, Esq., Timothy
P. Cairns, Esq., and Mark M. Billion, Esq., at Pachulski Stang
Ziehl & Jones LLP, in Wilmington, Delaware, serve as the Debtors'
local counsel. The Debtors' investment banker and financial
advisor is Rothschild Inc. The Debtors' notice, claims, and
solicitation agent is Kurtzman Carson Consultants LLC. The
Debtors' restructuring advisor is Alvarez & Marsal North America,
LLC.
Bankruptcy Creditors' Service, Inc., publishes Visteon Bankruptcy
News. The newsletter tracks the Chapter 11 proceedings of Visteon
Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/
or 215/945-7000)
VISTEON CORP: Modifies Credit Agreement With Ford Motor
--------------------------------------------------------------
Visteon Corporation and certain of its subsidiaries have entered
into a seventh amendment to the credit agreement dated Aug. 14,
2006, with Ford Motor Company, as the sole lender and swingline
lender, and JPMorgan Chase Bank N.A., as administrative agent.
The amendment modifies the credit agreement to require the company
to maintain at least $210 million of cash and cash equivalents at
all times -- previously $264 million -- subject to adjustment with
the consent of the required lenders, and require advance notice
for certain investments in foreign subsidiaries.
On May 22, 2009, the company terminated its European trade
accounts receivable securitization facility. As a result,
participating subsidiaries will repurchase receivables previously
sold under the program and outstanding as of May 22, 2009, and
amounts borrowed under the facility will be repaid.
A full-text copy of the company's Seventh Amendment to Credit
Agreement is available for free at:
http://ResearchArchives.com/t/s?3d6b
Headquartered in Van Buren Township, Michigan, Visteon Corporation
(NYSE: VC) -- http://www.visteon.com/-- is a global automotive
supplier that designs, engineers and manufactures innovative
climate, interior, electronic and lighting products for vehicle
manufacturers, and also provides a range of products and services
to aftermarket customers. The company has corporate offices in
Van Buren Township, Michigan (U.S.); Shanghai, China; and Kerpen,
Germany. It has facilities in 27 countries and employs roughly
35,500 people. The Company had assets of $4,561,000,000 and debts
of $5,311,000,000 as of March 31, 2009.
WILLIAM LYON: Unit Extends Senior Notes Tender Offer to June 5
--------------------------------------------------------------
William Lyon Homes disclosed that its wholly-owned subsidiary,
William Lyon Homes Inc., has extended the expiration date to
June 5, 2009, unless further extended, for its cash tender offer
to purchase its outstanding 7-5/8% Senior Notes due 2012, 10-3/4%
Senior Notes due 2013, and 7-1/2% Senior Notes due 2014.
The companies said that approximately $9.6 million aggregate
principal amount of notes have been tendered on May 21, 2009.
Under the amendment to the offer to purchase dated as of May 22,
2009, the tender offer will no longer be conducted according to
the modified "Dutch Auction" procedure. William Lyon said,
instead, it is offering to purchase the maximum aggregate
principal amount of Notes that it can purchase for $40,000,000 at
a purchase price per $1,000 principal amount for each series of
Notes.
About William Lyon Homes
Based in Newport Beach, California William Lyon Homes --
http://www.lyonhomes.com/-- designs, constructs and sells new
single-family detached and attached homes in California, Arizona
and Nevada.
* * *
In April 2009, Moody's Investors Service lowered the probability
of default rating of William Lyon Homes to Ca from Caa2 following
the company's announcement on April 13, 2009 that it had commenced
a cash tender whereby it would spend up to a maximum of $40
million to purchase a portion of its outstanding senior notes by
May 8, 2009. The cash tender amounts will be determined in
accordance with a modified Dutch Auction procedure. If the
auction is successful and the cash tender amounts fall within the
range of Moody's expectations, the transaction will constitute a
distressed exchange and a limited default by Moody's definition.
Following completion of the distressed exchange, Moody's will
likely restore the company's probability of default rating to
Caa2.
WISE METALS: December 31 Balance Sheet Upside-Down by $266MM
------------------------------------------------------------
Wise Metals Group LLC disclosed financial results for the year
ended December 31, 2008.
At December 31, 2008, the Company's balance sheet showed total
assets of $393,338,000 and total liabilities of $660,287,000,
resulting in a members' deficit of $266,949,000.
For the year ended December 31, 2008, the Company reported a net
loss of $72,342,000 compared with a net loss of $53,501,000 for
the same period in the previous year. For the quarter ended
December 31, 2008, the Company posted a net loss of $28,080,000
compared with net loss of a $26,416,000 for the same period in the
previous year.
Interest costs for the fourth quarter of 2008 of $9.0 million
reflect an increase of $1.2 million over the fourth quarter of
2007 due to increased borrowings.
During the fourth quarter, the Company amended its revolving
credit facility. As part of the transaction, with the Retirement
Systems of Alabama, RSA acquired a 4% ownership stake in Wise
Metals. Despite public debt financing which requires the Company
to file quarterly reports with the Securities and Exchange
Commission, Wise Metals remains a privately-owned interest with
majority ownership controlled by Mr. D'Addario.
"We reported record net sales for the full year, despite being
negatively impacted by the unprecedented drop in metal prices and
overall economic downturn," David D'Addario, chairman and chief
executive officer of Wise Metals Group, stated. "Throughout the
year we were able to maintain our sales volumes in can sheet, an
impressive accomplishment given that the global commercial
aluminum areas have almost disappeared. As the Company progresses
throughout 2009 and beyond, we expect to benefit from our expanded
relationship with RSA, which will also support our initiatives to
expand and enhance our Alabama-based operations."
The Company also hired Reznick Group, a certified public
accounting firm and a professional corporation, to supplement Wise
Metals' internal financial reporting staff and to bolster the
Company's control environment in 2009. Reznick provides a high
level of expertise that will help enhance Wise Metal's internal
reporting functions. Wise expects to maintain an ongoing
relationship with Reznick throughout 2009 and beyond, as
appropriate.
The Company also disclosed that beginning with its 2009 10-K
filing, due in March 2010, the Company will be required for the
first time to obtain an attestation report of its internal control
over financial reporting from an independent registered public
accounting firm.
About Wise Metals Group
Based in Baltimore, Maryland, Wise Metals Group LLC includes Wise
Alloys, the world's third-leading producer of aluminum can stock
for the beverage and food industries; Wise Recycling, one of the
largest, direct-from-the-public collectors of aluminum beverage
containers in the United States, operating shipping and processing
locations throughout the United States that support a network of
neighborhood collection centers; and Listerhill Total Maintenance
Center, specializing in providing maintenance, repairs and
fabrication to manufacturing and industrial plants worldwide
ranging from small on-site repairs to complete turn-key
maintenance.
* * *
As reported in the Troubled Company Reporter on March 20, 2009,
Standard & Poor's Ratings Services revised its outlook on Wise
Metals Group LLC to negative from developing. At the same time,
Standard & Poor's affirmed its 'CCC' corporate credit rating.
* Barry N. Seidel Joins Butzel Long as Shareholder
--------------------------------------------------
Veteran bankruptcy attorney Barry N. Seidel has joined the New
York office of Butzel Long as a shareholder.
Immediately prior to joining Butzel Long, Mr. Seidel was a partner
in King & Spalding's New York restructuring group. Prior to that,
he was a partner at Willkie Farr & Gallagher and Sonnenschein Nath
& Rosenthal, and a senior member of Cadwalader's New York
bankruptcy department.
"Over the past nearly three decades, Barry has built a diverse and
impressive practice in complex Chapter 11 cases and out-of-court
restructurings, representing both debtors and creditors," said
Philip J. Kessler, chairman of the firm. "As we continue to
expand the bankruptcy practice on a national level, and
particularly, work with automotive suppliers and creditors through
these challenging times, his knowledge and experience will be
invaluable."
Over the course of his career, Mr. Seidel has played an active
role in the representation of some of the largest Chapter 11
debtors, and his experience goes well beyond debtor
representations. He has represented commercial lenders in
connection with the restructuring of their pre-default loans as
well as in connection with their DIP financing activities. He has
represented official and unofficial creditors' committees, formed
for the purpose of representing the interests of trade, bondholder
or bank creditors. Mr. Seidel also has advised numerous clients
as to deal structure and strategy for the acquisition of
businesses and assets from financially distressed sellers, both in
and out of bankruptcy court. His bankruptcy experience also
encompasses the representation of bankruptcy fiduciaries.
In addition to his expertise in all aspects of bankruptcy law and
practice, Mr. Seidel has substantial experience in corporate and
healthcare law which he has gained through his representation of
publicly and privately owned companies. Butzel Long's Health Care
Practice has in depth experience and a wide range of resources to
help clients deal with ongoing business issues, critical
regulatory and litigation-related matters and complex
transactions.
Mr. Seidel said, "I am very excited to join Butzel Long. Given
the firm's strong ties to the auto industry, it is the right place
at the right time for a New York bankruptcy lawyer. Butzel Long
is committed to a practice model that emphasizes delivering high
quality services on a timely basis, at a reasonable price. This
is extremely attractive to my clients, particularly in today's
environment."
Mr. Seidel is a member of the American Bar Association and the
American Bankruptcy Institute, and is on the Board of the New York
chapter of the Turnaround Management Association. He is "AV" rated
in Martindale-Hubbell.
A graduate, cum laude from the State University of New York at
Stony Brook, Mr. Seidel received his J.D., cum laude, from the
University of Michigan.
About Butzel Long
Butzel Long -- http://www.butzel.com-- is one of America's
leading law firms, with 240 attorneys and offices in Detroit,
Bloomfield Hills, Lansing and Ann Arbor, Michigan, New York City,
Washington, D.C., Boca Raton and Palm Beach, Florida, as well as
Alliance offices in Beijing, Shanghai, Mexico City and Monterrey.
The firm is also a member of the Washington, D.C. law firm Butzel
Long Tighe Patton. Butzel Long represents clients from diverse
industries on a regional, national and multi-national level and is
a member of Lex Mundi, a global association of 160 independent law
firms.
* Seven Lawyers From Kirkland & Ellis Join Jones Day
----------------------------------------------------
The international law firm Jones Day has expanded its global
Business Restructuring & Reorganization Practice with seven
lawyers from Kirkland & Ellis.
Richard L. Wynne and Bennett L. Spiegel join as partners, and Lori
Sinanyan and Erin N. Brady join as of counsel in the Firm's Los
Angeles Office. They will be joined by three associates (two in
Los Angeles, one in New York). Jones Day has one of the world's
leading restructuring practices and the Firm's U.S. West Coast
practice is now one of the most substantial in California with
five partners, three of counsel, and two members of the American
College of Bankruptcy.
"The addition of these exceptional lawyers to our restructuring
practice not only bolsters our capabilities in the U.S. West Coast
restructuring arena, but also solidifies our ability to handle the
most intense and complex restructurings in any industry anywhere
in the U.S. and around the world," said Paul Leake, head of Jones
Day's BRR practice. "With more than 100 lawyers in the Practice,
these new members fortify our position as one of the leading
global restructuring law firms."
Mr. Wynne's practice -- which will operate from both Los Angeles
and New York -- focuses on complex restructuring matters,
representing debtors, creditors and creditors committees,
purchasers, and lenders in Chapter 11 cases and out-of-court
workouts in a wide variety of industries focusing on cases in
California, New York, and Delaware. Formerly the leader of
Kirkland & Ellis LLP's West Coast restructuring practice, he was
inducted in March 2006 in the 17th Class of the American College
of Bankruptcy, an honorary professional and educational
association of bankruptcy and insolvency professionals. Mr. Wynne
has been lead debtors' counsel in major Chapter 11 cases and has
recently focused on significant bondholder and creditor committee
representations. Mr. Wynne is currently representing the Station
Casinos bondholders' committee in an out-of-court restructuring
involving their approximately $2.4 billion in unsecured debt and
over $3 billion in secured debt. For the past four years he also
has represented the Adelphia Non-Agent Lenders Committee, a group
of 400 lenders who held approximately $4.3 billion in Adelphia
bank debt. This group of Adelphia lenders ultimately received
payment in full of all principal, interest, and legal fees
incurred during the bankruptcy case. After the Chapter 11 case,
Mr. Wynne led the successful effort to have all bankruptcy
avoidance and other claims against this group (seeking the return
of the $4.3 billion paid to them) dismissed by the District Court
for the Southern District of New York. A frequent writer and
speaker on bankruptcy-related topics, his work has been featured
in various national journals, magazines, and seminars. Mr. Wynne
earned his undergraduate degree from Indiana University and his
law degree from the Columbia University School of Law.
Mr. Spiegel concentrates primarily on the representation of
debtors, creditors, creditors' committees, and asset purchasers in
corporate restructurings and bankruptcies. His experience
includes the management of a restructuring team in the Chapter 11
cases of Calpine Corporation and over 250 of its affiliates,
responsible for disposition of all leased properties (including
power plants with leveraged lease obligations in excess of
$1 billion in the aggregate, other power plant leases, geothermal
leases, and office leases) and sale of power plants or interests
therein, a turbine design and manufacturing business and other
miscellaneous assets for over $1 billion in the aggregate, thus
enabling Calpine to reduce its debt, raise capital, and dispose of
idle or non-core assets. Mr. Spiegel was also lead Chapter 11
bankruptcy counsel for RBS Greenwich Capital in connection with
its $100 million DIP financing of New Century Financial
Corporation, its $500 million DIP financing of American Business
Financial Services, Inc., and its $215 million DIP financing of
Oakwood Homes Corporation. He has been consistently selected by
his peers as a Super Lawyer in Southern California and is a member
of the Board of Editors of The Bankruptcy Strategist. Mr. Spiegel
received his undergraduate degree from Rutgers College, his M.B.A.
from the Yale School of Management, and his law degree from Yale
Law School.
Messrs. Wynne and Spiegel are the 41st and 42nd lateral partners
to join Jones Day's five California offices since the beginning of
2007.
"The addition of this substantial restructuring strength in Los
Angeles creates added depth to our transaction and litigation
services," said Rick McKnight, Partner-in-Charge of Jones Day's
Los Angeles Office. "We are both fortunate and excited to have
lawyers of this caliber become our colleagues, to continue our
growth in Los Angeles and throughout California, and to enhance
the service we provide to our clients."
Ms. Sinanyan focuses her practice on debtor and Chapter 11 trustee
representations in various jurisdictions nationwide. Her
experience also includes the representation of creditor committees
and secured creditors in bankruptcy cases. Her most recent
representations include the Station Casinos bondholders' committee
in an out-of-court restructuring, and debtors Leiner Health
Products Inc., W. R. Grace & Co., and Calpine Corporation. Since
2004, the Southern California Super Lawyers magazine has named her
a "Southern California Rising Star." Ms. Sinanyan's memberships
and affiliations include the American Bankruptcy Institute, the
International Women's Insolvency & Restructuring Confederation
(IWIRC) and the Armenian Bar Association. She received her
undergraduate degree from the University of California, Los
Angeles, and her law degree from the University of Southern
California, Gould School of Law.
Ms. Brady's practice encompasses the representation of debtors,
creditors' committees, equity committees, trustees, individual
creditors and interested third-parties in Chapter 11 bankruptcy
cases. She has extensive experience in asset sales and
acquisitions, bankruptcy related litigation, and Chapter 11
restructurings. In the recent Adelphia bankruptcy case, she
successfully represented the Non-Agent Lenders Committee in
defending against more than $4.5 billion in preference, fraudulent
conveyance, equitable subordination and equitable disallowance
claims that the Adelphia Recovery Trust asserted against them. The
claims were resolved on motions to dismiss. From 2006-2008 she
was selected to Madison Who's Who of Executives and Professionals,
and in 2008 was named a Southern California Super Lawyer. Ms.
Brady earned her undergraduate degree from Cardinal Stritch
University and her law degree from Pepperdine University School of
Law.
Jones Day is an international law firm with 32 locations in
centers of business and finance throughout the world. With more
than 2,400 lawyers, including more than 400 in Europe and 200 in
Asia, it ranks among the world?s largest law firms. In
California, Jones Day has more than 300 lawyers in five offices
(San Francisco, Silicon Valley, Los Angeles, Irvine, and San
Diego). Jones Day acts as principal outside counsel to, or
provides significant legal representation for, more than half of
the Fortune Global 500 companies.
* BOND PRICING -- For the Week From May 18 to 22, 2009
------------------------------------------------------
Company Coupon Maturity Bid Price
------- ------ -------- ---------
ACCURIDE CORP 8.50 % 2/1/2015 30.00
ADVANTA CAP TR 8.99 % 12/17/2026 9.50
AHERN RENTALS 9.25 % 8/15/2013 35.50
ALERIS INTL INC 9.00 % 12/15/2014 1.50
ALERIS INTL INC 10.00 % 12/15/2016 2.75
ALION SCIENCE 10.25 % 2/1/2015 28.50
ALLIED CAP CORP 6.00 % 4/1/2012 43.90
ALLIED CAP CORP 6.63 % 7/15/2011 46.60
AMBASSADORS INTL 3.75 % 4/15/2027 31.63
AMER AXLE & MFG 5.25 % 2/11/2014 26.00
AMER CAP STRATEG 8.60 % 8/1/2012 46.50
AMER GENL FIN 3.10 % 6/15/2009 73.60
AMER GENL FIN 3.88 % 10/1/2009 91.27
AMER GENL FIN 4.00 % 6/15/2009 98.11
AMER GENL FIN 4.30 % 6/15/2009 88.00
AMER GENL FIN 4.35 % 6/15/2009 90.00
AMER GENL FIN 4.35 % 6/15/2009 80.17
AMER GENL FIN 4.88 % 5/15/2010 80.38
AMER GENL FIN 5.00 % 10/15/2010 35.00
AMER GENL FIN 5.00 % 12/15/2010 36.00
AMER GENL FIN 5.00 % 1/15/2011 40.00
AMER GENL FIN 5.10 % 6/15/2009 98.18
AMER GENL FIN 5.15 % 6/15/2009 98.18
AMER GENL FIN 5.25 % 6/15/2009 95.00
AMER GENL FIN 5.25 % 6/15/2009 98.18
AMER GENL FIN 5.30 % 6/15/2009 98.22
AMER GENL FIN 5.35 % 7/15/2010 50.00
AMER GENL FIN 5.38 % 9/1/2009 97.00
AMER GENL FIN 5.50 % 6/15/2009 98.20
AMER GENL FIN 8.13 % 8/15/2009 93.56
AMER INTL GROUP 4.70 % 10/1/2010 73.40
AMER MEDIA OPER 8.88 % 1/15/2011 41.88
AMR CORP 9.20 % 1/30/2012 48.00
AMR CORP 10.40 % 3/15/2011 46.00
ANTHRACITE CAP 11.75 % 9/1/2027 20.50
ANTIGENICS 5.25 % 2/1/2025 25.50
APPLETON PAPERS 9.75 % 6/15/2014 35.06
ARCO CHEMICAL CO 9.80 % 2/1/2020 24.26
ARCO CHEMICAL CO 10.25 % 11/1/2010 23.00
ARVINMERITOR 8.75 % 3/1/2012 43.50
AVENTINE RENEW 10.00 % 4/1/2017 12.00
BALLY TOTAL FITN 14.00 % 10/1/2013 2.00
BANK NEW ENGLAND 8.75 % 4/1/1999 10.13
BANK NEW ENGLAND 9.88 % 9/15/1999 9.70
BANKUNITED CAP 3.13 % 3/1/2034 4.75
BARRINGTON BROAD 10.50 % 8/15/2014 20.00
BEAZER HOMES USA 4.63 % 6/15/2024 50.63
BEAZER HOMES USA 8.38 % 4/15/2012 50.25
BEAZER HOMES USA 8.63 % 5/15/2011 59.00
BELL MICROPRODUC 3.75 % 3/5/2024 24.00
BLOCKBUSTER INC 9.00 % 9/1/2012 48.50
BORDEN INC 8.38 % 4/15/2016 18.62
BORDEN INC 9.20 % 3/15/2021 23.00
BOWATER INC 6.50 % 6/15/2013 16.00
BOWATER INC 9.38 % 12/15/2021 16.56
BOWATER INC 9.50 % 10/15/2012 15.25
BRODER BROS CO 11.25 % 10/15/2010 30.13
BROOKSTONE CO 12.00 % 10/15/2012 38.00
C&D TECHNOLOGIES 5.50 % 11/15/2026 44.66
CALLON PETROLEUM 9.75 % 12/8/2010 34.00
CAPMARK FINL GRP 7.88 % 5/10/2012 30.00
CAPMARK FINL GRP 8.30 % 5/10/2017 25.00
CASE NEW HOLLAND 6.00 % 6/1/2009 100.00
CCH I LLC 9.92 % 4/1/2014 0.75
CCH I LLC 10.00 % 5/15/2014 1.00
CCH I LLC 11.13 % 1/15/2014 0.75
CCH I LLC 11.75 % 5/15/2014 0.75
CCH I LLC 12.13 % 1/15/2015 1.06
CCH I LLC 13.50 % 1/15/2014 1.00
CCH I/CCH I CP 11.00 % 10/1/2015 10.00
CCH I/CCH I CP 11.00 % 10/1/2015 11.50
CHAMPION ENTERPR 2.75 % 11/1/2037 24.25
CHARTER COMM HLD 9.92 % 4/1/2011 0.56
CHARTER COMM HLD 10.00 % 5/15/2011 1.00
CHARTER COMM HLD 11.75 % 5/15/2011 1.50
CHARTER COMM HLD 12.13 % 1/15/2012 1.50
CHARTER COMM HLD 13.50 % 1/15/2011 1.50
CHARTER COMM INC 6.50 % 10/1/2027 14.63
CIT GROUP INC 4.50 % 7/15/2009 91.00
CIT GROUP INC 4.85 % 12/15/2011 40.00
CIT GROUP INC 4.88 % 6/15/2013 34.00
CIT GROUP INC 5.05 % 11/15/2010 55.00
CIT GROUP INC 5.05 % 7/15/2013 33.60
CIT GROUP INC 5.30 % 7/15/2014 26.50
CIT GROUP INC 5.40 % 9/15/2013 30.00
CIT GROUP INC 6.25 % 2/15/2010 81.05
CIT GROUP INC 6.60 % 2/15/2011 60.00
CIT GROUP INC 7.60 % 2/15/2013 39.25
CLAIRE'S STORES 10.50 % 6/1/2017 32.00
CLEAR CHANNEL 4.40 % 5/15/2011 22.00
CLEAR CHANNEL 4.50 % 1/15/2010 54.75
CLEAR CHANNEL 4.90 % 5/15/2015 14.25
CLEAR CHANNEL 5.00 % 3/15/2012 19.00
CLEAR CHANNEL 5.50 % 9/15/2014 13.50
CLEAR CHANNEL 5.50 % 12/15/2016 14.00
CLEAR CHANNEL 5.75 % 1/15/2013 14.00
CLEAR CHANNEL 6.25 % 3/15/2011 31.50
CLEAR CHANNEL 6.88 % 6/15/2018 15.00
CLEAR CHANNEL 7.25 % 10/15/2027 14.00
CLEAR CHANNEL 7.65 % 9/15/2010 40.00
CLEAR CHANNEL 10.75 % 8/1/2016 21.38
COMMERCIAL VEHIC 8.00 % 7/1/2013 32.10
COMPREHENS CARE 7.50 % 4/15/2010 75.13
COMPUCREDIT 3.63 % 5/30/2025 34.50
CONEXANT SYSTEMS 4.00 % 3/1/2026 29.75
CONSTAR INTL 11.00 % 12/1/2012 6.00
COOPER-STANDARD 7.00 % 12/15/2012 19.00
COOPER-STANDARD 8.38 % 12/15/2014 12.09
CREDENCE SYSTEM 3.50 % 5/15/2010 40.73
DAE AVIATION 11.25 % 8/1/2015 35.25
DECODE GENETICS 3.50 % 4/15/2011 5.50
DELPHI CORP 6.50 % 8/15/2013 1.50
DELPHI CORP 8.25 % 10/15/2033 0.60
DELTA PETROLEUM 3.75 % 5/1/2037 38.00
DEX MEDIA INC 8.00 % 11/15/2013 15.50
DEX MEDIA INC 9.00 % 11/15/2013 13.19
DEX MEDIA INC 9.00 % 11/15/2013 16.25
DEX MEDIA WEST 8.50 % 8/15/2010 61.00
DEX MEDIA WEST 9.88 % 8/15/2013 24.50
DUNE ENERGY INC 10.50 % 6/1/2012 42.00
EDDIE BAUER HLDG 5.25 % 4/1/2014 20.25
ENCOMPASS SERVIC 10.50 % 5/1/2009 5.00
ENERGY PARTNERS 8.75 % 8/1/2010 35.00
EPIX MEDICAL INC 3.00 % 6/15/2024 19.13
FAIRPOINT COMMUN 13.13 % 4/1/2018 33.00
FIBERTOWER CORP 9.00 % 11/15/2012 40.50
FINISAR CORP 2.50 % 10/15/2010 58.25
FINLAY FINE JWLY 8.38 % 6/1/2012 3.09
FIRST DATA CORP 5.63 % 11/1/2011 44.00
FLOTEK INDS 5.25 % 2/15/2028 25.25
FONTAINEBLEAU LA 11.00 % 6/15/2015 23.00
FORD MOTOR CRED 4.80 % 7/20/2009 91.09
FORD MOTOR CRED 5.00 % 8/20/2009 90.28
FORD MOTOR CRED 5.50 % 6/22/2009 95.00
FORD MOTOR CRED 5.50 % 2/22/2010 79.32
FORD MOTOR CRED 5.70 % 3/22/2010 72.50
FORD MOTOR CRED 7.00 % 7/1/2010 71.50
FORD MOTOR CRED 7.72 % 5/17/2010 70.53
FORD MOTOR CRED 8.00 % 12/20/2010 62.00
FRANKLIN BANK 4.00 % 5/1/2027 0.01
FREESCALE SEMICO 10.13 % 12/15/2016 27.50
FRONTIER AIRLINE 5.00 % 12/15/2025 8.00
GENCORP INC 2.25 % 11/15/2024 39.00
GENCORP INC 4.00 % 1/16/2024 77.27
GENERAL MOTORS 6.75 % 5/1/2028 8.50
GENERAL MOTORS 7.13 % 7/15/2013 6.25
GENERAL MOTORS 7.20 % 1/15/2011 6.13
GENERAL MOTORS 7.40 % 9/1/2025 5.13
GENERAL MOTORS 7.70 % 4/15/2016 8.75
GENERAL MOTORS 8.10 % 6/15/2024 4.95
GENERAL MOTORS 8.25 % 7/15/2023 4.95
GENERAL MOTORS 8.38 % 7/15/2033 4.95
GENERAL MOTORS 8.80 % 3/1/2021 4.48
GENERAL MOTORS 9.40 % 7/15/2021 4.55
GENERAL MOTORS 9.45 % 11/1/2011 8.50
GENWORTH GLOBAL 6.10 % 4/15/2033 15.25
GEORGIA GULF CRP 7.13 % 12/15/2013 22.25
GGP LP 3.98 % 4/15/2027 29.82
GMAC LLC 4.95 % 10/15/2009 87.00
GMAC LLC 5.05 % 7/15/2009 93.56
GMAC LLC 5.10 % 8/15/2009 92.50
GMAC LLC 5.25 % 6/15/2009 98.00
GMAC LLC 5.25 % 7/15/2009 95.00
GMAC LLC 5.25 % 11/15/2009 84.50
GMAC LLC 5.35 % 6/15/2009 98.00
GMAC LLC 5.35 % 12/15/2009 82.33
GMAC LLC 5.40 % 6/15/2009 97.50
GMAC LLC 6.25 % 6/15/2009 86.50
GMAC LLC 6.25 % 6/15/2009 98.50
GMAC LLC 6.25 % 7/15/2013 31.00
GMAC LLC 6.30 % 6/15/2009 91.00
GMAC LLC 6.30 % 6/15/2009 98.10
GMAC LLC 6.30 % 7/15/2009 84.50
GMAC LLC 6.50 % 2/15/2013 32.00
GMAC LLC 6.65 % 7/15/2009 92.76
GMAC LLC 6.65 % 2/15/2013 33.12
GMAC LLC 6.70 % 7/15/2009 95.50
GMAC LLC 6.70 % 5/15/2014 23.39
GMAC LLC 6.75 % 11/15/2009 75.50
GMAC LLC 6.80 % 7/15/2009 96.00
GMAC LLC 6.90 % 12/15/2009 83.88
GMAC LLC 7.00 % 7/15/2009 93.00
GMAC LLC 7.00 % 12/15/2009 85.00
GMAC LLC 7.05 % 10/15/2009 88.00
GMAC LLC 7.13 % 8/15/2009 93.00
GMAC LLC 7.25 % 1/15/2010 66.00
GMAC LLC 7.50 % 9/15/2010 57.00
GMAC LLC 7.63 % 11/15/2012 34.50
GMAC LLC 8.25 % 9/15/2012 34.00
GMAC LLC 8.50 % 5/15/2010 75.50
GMAC LLC 8.50 % 8/15/2015 28.00
GREAT LAKES CHEM 7.00 % 7/15/2009 43.75
HAIGHTS CROSS OP 11.75 % 8/15/2011 57.88
HANNA (MA) CO 6.52 % 2/23/2010 70.06
HARRY & DAVID OP 9.00 % 3/1/2013 35.75
HAWAIIAN TELCOM 9.75 % 5/1/2013 3.00
HEADWATERS INC 2.88 % 6/1/2016 31.00
HILTON HOTELS 7.50 % 12/15/2017 20.18
HINES NURSERIES 10.25 % 10/1/2011 14.00
IDEARC INC 8.00 % 11/15/2016 2.78
INCYTE CORP 3.50 % 2/15/2011 55.00
INN OF THE MOUNT 12.00 % 11/15/2010 14.00
INTCOMEX INC 11.75 % 1/15/2011 38.50
INTERDENT SVC 10.75 % 12/15/2011 52.40
INTL LEASE FIN 3.25 % 2/15/2010 65.00
INTL LEASE FIN 3.55 % 7/15/2009 95.45
INTL LEASE FIN 3.88 % 2/15/2010 75.38
INTL LEASE FIN 4.00 % 10/15/2009 75.25
INTL LEASE FIN 4.00 % 12/15/2009 74.50
INTL LEASE FIN 4.25 % 8/15/2009 93.11
INTL LEASE FIN 4.25 % 10/15/2010 60.50
INTL LEASE FIN 4.30 % 8/15/2010 51.20
INTL LEASE FIN 4.38 % 8/15/2009 91.75
INTL LEASE FIN 4.40 % 8/15/2009 92.70
INTL LEASE FIN 4.80 % 6/15/2010 73.00
INTL LEASE FIN 4.85 % 9/15/2010 67.00
INTL LEASE FIN 5.00 % 6/15/2012 42.00
INTL LEASE FIN 5.25 % 8/15/2009 90.73
INTL LEASE FIN 5.50 % 4/15/2012 33.25
INTL LEASE FIN 7.25 % 2/15/2010 78.00
INTL LEASE FIN 7.75 % 2/15/2010 82.00
ISTAR FINANCIAL 5.13 % 4/1/2011 51.00
ISTAR FINANCIAL 5.13 % 4/1/2011 51.00
ISTAR FINANCIAL 5.15 % 3/1/2012 41.00
ISTAR FINANCIAL 5.50 % 6/15/2012 47.00
ISTAR FINANCIAL 5.80 % 3/15/2011 54.50
ISTAR FINANCIAL 6.00 % 12/15/2010 61.00
JAZZ TECHNOLOGIE 8.00 % 12/31/2011 24.50
JEFFERSON SMURFI 7.50 % 6/1/2013 26.63
JEFFERSON SMURFI 8.25 % 10/1/2012 26.50
K HOVNANIAN ENTR 7.75 % 5/15/2013 38.00
K HOVNANIAN ENTR 8.88 % 4/1/2012 48.27
KAISER ALUM&CHEM 12.75 % 2/1/2003 8.10
KELLWOOD CO 7.63 % 10/15/2017 5.00
KEMET CORP 2.25 % 11/15/2026 30.75
KEMET CORP 2.25 % 11/15/2026 31.00
KEYSTONE AUTO OP 9.75 % 11/1/2013 35.59
KKR FINANCIAL 7.00 % 7/15/2012 43.25
KNIGHT RIDDER 4.63 % 11/1/2014 24.50
KNIGHT RIDDER 6.88 % 3/15/2029 19.00
KNIGHT RIDDER 7.13 % 6/1/2011 33.50
LANDAMERICA 3.13 % 11/15/2033 11.52
LANDAMERICA 3.25 % 5/15/2034 12.25
LEAR CORP 5.75 % 8/1/2014 34.00
LEAR CORP 8.50 % 12/1/2013 25.50
LEAR CORP 8.75 % 12/1/2016 25.75
LEHMAN BROS HLDG 1.50 % 3/23/2012 12.50
LEHMAN BROS HLDG 4.25 % 1/27/2010 14.00
LEHMAN BROS HLDG 4.38 % 11/30/2010 12.88
LEHMAN BROS HLDG 4.50 % 7/26/2010 13.63
LEHMAN BROS HLDG 4.50 % 8/3/2011 8.50
LEHMAN BROS HLDG 4.80 % 2/27/2013 7.00
LEHMAN BROS HLDG 4.80 % 3/13/2014 14.88
LEHMAN BROS HLDG 4.80 % 6/24/2023 7.25
LEHMAN BROS HLDG 5.00 % 1/14/2011 12.25
LEHMAN BROS HLDG 5.00 % 1/22/2013 6.25
LEHMAN BROS HLDG 5.00 % 2/11/2013 9.50
LEHMAN BROS HLDG 5.00 % 3/27/2013 7.00
LEHMAN BROS HLDG 5.00 % 8/3/2014 7.25
LEHMAN BROS HLDG 5.00 % 8/5/2015 6.00
LEHMAN BROS HLDG 5.00 % 12/18/2015 10.00
LEHMAN BROS HLDG 5.00 % 5/28/2023 8.25
LEHMAN BROS HLDG 5.00 % 5/30/2023 7.00
LEHMAN BROS HLDG 5.00 % 6/10/2023 7.76
LEHMAN BROS HLDG 5.00 % 6/17/2023 7.25
LEHMAN BROS HLDG 5.10 % 1/28/2013 6.00
LEHMAN BROS HLDG 5.10 % 2/15/2020 7.00
LEHMAN BROS HLDG 5.15 % 2/4/2015 9.50
LEHMAN BROS HLDG 5.20 % 5/13/2020 8.01
LEHMAN BROS HLDG 5.25 % 2/6/2012 13.50
LEHMAN BROS HLDG 5.25 % 1/30/2014 7.13
LEHMAN BROS HLDG 5.25 % 2/11/2015 9.55
LEHMAN BROS HLDG 5.25 % 3/8/2020 10.00
LEHMAN BROS HLDG 5.25 % 5/20/2023 7.38
LEHMAN BROS HLDG 5.35 % 3/13/2020 7.50
LEHMAN BROS HLDG 5.35 % 6/14/2030 7.55
LEHMAN BROS HLDG 5.38 % 5/6/2023 9.25
LEHMAN BROS HLDG 5.40 % 3/6/2020 9.50
LEHMAN BROS HLDG 5.40 % 3/20/2020 7.28
LEHMAN BROS HLDG 5.40 % 3/30/2029 7.25
LEHMAN BROS HLDG 5.40 % 6/21/2030 8.01
LEHMAN BROS HLDG 5.45 % 3/15/2025 6.39
LEHMAN BROS HLDG 5.45 % 4/6/2029 7.00
LEHMAN BROS HLDG 5.45 % 2/22/2030 6.93
LEHMAN BROS HLDG 5.45 % 7/19/2030 8.00
LEHMAN BROS HLDG 5.45 % 9/20/2030 8.00
LEHMAN BROS HLDG 5.50 % 4/4/2016 13.50
LEHMAN BROS HLDG 5.50 % 2/4/2018 6.34
LEHMAN BROS HLDG 5.50 % 2/19/2018 5.60
LEHMAN BROS HLDG 5.50 % 11/4/2018 7.25
LEHMAN BROS HLDG 5.50 % 2/27/2020 7.75
LEHMAN BROS HLDG 5.50 % 8/19/2020 7.25
LEHMAN BROS HLDG 5.50 % 3/14/2023 6.00
LEHMAN BROS HLDG 5.50 % 4/8/2023 7.00
LEHMAN BROS HLDG 5.50 % 4/15/2023 8.20
LEHMAN BROS HLDG 5.50 % 4/23/2023 9.25
LEHMAN BROS HLDG 5.50 % 8/5/2023 4.95
LEHMAN BROS HLDG 5.50 % 10/7/2023 7.50
LEHMAN BROS HLDG 5.50 % 1/27/2029 8.00
LEHMAN BROS HLDG 5.50 % 2/3/2029 7.00
LEHMAN BROS HLDG 5.50 % 8/2/2030 7.50
LEHMAN BROS HLDG 5.55 % 2/11/2018 7.00
LEHMAN BROS HLDG 5.55 % 3/9/2029 7.25
LEHMAN BROS HLDG 5.55 % 1/25/2030 7.55
LEHMAN BROS HLDG 5.55 % 9/27/2030 8.12
LEHMAN BROS HLDG 5.55 % 12/31/2034 8.01
LEHMAN BROS HLDG 5.60 % 1/22/2018 7.75
LEHMAN BROS HLDG 5.60 % 2/17/2029 7.55
LEHMAN BROS HLDG 5.60 % 2/24/2029 8.00
LEHMAN BROS HLDG 5.60 % 3/2/2029 8.01
LEHMAN BROS HLDG 5.60 % 2/25/2030 7.50
LEHMAN BROS HLDG 5.60 % 5/3/2030 7.61
LEHMAN BROS HLDG 5.63 % 1/24/2013 14.50
LEHMAN BROS HLDG 5.63 % 3/15/2030 7.66
LEHMAN BROS HLDG 5.65 % 11/23/2029 9.50
LEHMAN BROS HLDG 5.65 % 8/16/2030 8.01
LEHMAN BROS HLDG 5.65 % 12/31/2034 7.00
LEHMAN BROS HLDG 5.70 % 1/28/2018 6.50
LEHMAN BROS HLDG 5.70 % 2/10/2029 5.55
LEHMAN BROS HLDG 5.70 % 4/13/2029 7.00
LEHMAN BROS HLDG 5.70 % 9/7/2029 8.01
LEHMAN BROS HLDG 5.70 % 12/14/2029 7.88
LEHMAN BROS HLDG 5.75 % 4/25/2011 14.50
LEHMAN BROS HLDG 5.75 % 7/18/2011 14.00
LEHMAN BROS HLDG 5.75 % 5/17/2013 14.00
LEHMAN BROS HLDG 5.75 % 3/27/2023 7.15
LEHMAN BROS HLDG 5.75 % 9/16/2023 9.00
LEHMAN BROS HLDG 5.75 % 10/15/2023 8.50
LEHMAN BROS HLDG 5.75 % 10/21/2023 7.75
LEHMAN BROS HLDG 5.75 % 11/12/2023 6.85
LEHMAN BROS HLDG 5.75 % 11/25/2023 6.00
LEHMAN BROS HLDG 5.75 % 12/16/2028 9.75
LEHMAN BROS HLDG 5.75 % 12/23/2028 7.75
LEHMAN BROS HLDG 5.75 % 8/24/2029 7.00
LEHMAN BROS HLDG 5.75 % 9/14/2029 5.66
LEHMAN BROS HLDG 5.75 % 10/12/2029 9.50
LEHMAN BROS HLDG 5.75 % 3/29/2030 8.75
LEHMAN BROS HLDG 5.80 % 9/3/2020 7.90
LEHMAN BROS HLDG 5.80 % 10/25/2030 6.50
LEHMAN BROS HLDG 5.85 % 11/8/2030 9.00
LEHMAN BROS HLDG 5.88 % 11/15/2017 13.00
LEHMAN BROS HLDG 5.90 % 5/4/2029 7.12
LEHMAN BROS HLDG 5.90 % 2/7/2031 7.00
LEHMAN BROS HLDG 5.95 % 12/20/2030 7.50
LEHMAN BROS HLDG 6.00 % 7/19/2012 13.90
LEHMAN BROS HLDG 6.00 % 1/22/2020 9.00
LEHMAN BROS HLDG 6.00 % 2/12/2020 8.60
LEHMAN BROS HLDG 6.00 % 1/29/2021 8.10
LEHMAN BROS HLDG 6.00 % 10/23/2028 8.01
LEHMAN BROS HLDG 6.00 % 11/18/2028 7.00
LEHMAN BROS HLDG 6.00 % 5/11/2029 8.01
LEHMAN BROS HLDG 6.00 % 7/20/2029 6.93
LEHMAN BROS HLDG 6.00 % 4/30/2034 5.96
LEHMAN BROS HLDG 6.00 % 7/30/2034 7.67
LEHMAN BROS HLDG 6.00 % 2/21/2036 7.76
LEHMAN BROS HLDG 6.00 % 2/24/2036 8.66
LEHMAN BROS HLDG 6.00 % 2/12/2037 7.50
LEHMAN BROS HLDG 6.05 % 6/29/2029 7.45
LEHMAN BROS HLDG 6.10 % 8/12/2023 8.76
LEHMAN BROS HLDG 6.15 % 4/11/2031 6.75
LEHMAN BROS HLDG 6.20 % 9/26/2014 15.38
LEHMAN BROS HLDG 6.20 % 6/15/2027 8.02
LEHMAN BROS HLDG 6.20 % 5/25/2029 7.25
LEHMAN BROS HLDG 6.25 % 2/5/2021 6.73
LEHMAN BROS HLDG 6.25 % 2/22/2023 6.50
LEHMAN BROS HLDG 6.40 % 10/11/2022 7.25
LEHMAN BROS HLDG 6.40 % 12/19/2036 12.50
LEHMAN BROS HLDG 6.50 % 2/28/2023 5.88
LEHMAN BROS HLDG 6.50 % 3/6/2023 7.35
LEHMAN BROS HLDG 6.50 % 10/18/2027 5.93
LEHMAN BROS HLDG 6.50 % 10/25/2027 7.00
LEHMAN BROS HLDG 6.50 % 11/15/2032 7.35
LEHMAN BROS HLDG 6.50 % 1/17/2033 7.00
LEHMAN BROS HLDG 6.50 % 12/22/2036 7.50
LEHMAN BROS HLDG 6.50 % 2/13/2037 8.50
LEHMAN BROS HLDG 6.50 % 6/21/2037 7.00
LEHMAN BROS HLDG 6.50 % 7/13/2037 7.00
LEHMAN BROS HLDG 6.60 % 10/3/2022 7.75
LEHMAN BROS HLDG 6.63 % 1/18/2012 13.65
LEHMAN BROS HLDG 6.75 % 7/1/2022 5.50
LEHMAN BROS HLDG 6.75 % 3/11/2033 7.63
LEHMAN BROS HLDG 6.75 % 10/26/2037 9.00
LEHMAN BROS HLDG 6.80 % 9/7/2032 7.25
LEHMAN BROS HLDG 6.85 % 8/16/2032 9.50
LEHMAN BROS HLDG 6.88 % 5/2/2018 16.81
LEHMAN BROS HLDG 6.88 % 7/17/2037 0.01
LEHMAN BROS HLDG 6.90 % 9/1/2032 8.75
LEHMAN BROS HLDG 7.00 % 4/16/2019 5.88
LEHMAN BROS HLDG 7.00 % 5/12/2023 7.09
LEHMAN BROS HLDG 7.00 % 9/27/2027 15.25
LEHMAN BROS HLDG 7.00 % 10/4/2032 9.50
LEHMAN BROS HLDG 7.00 % 7/27/2037 8.34
LEHMAN BROS HLDG 7.00 % 9/28/2037 7.70
LEHMAN BROS HLDG 7.00 % 11/16/2037 7.45
LEHMAN BROS HLDG 7.00 % 12/28/2037 8.60
LEHMAN BROS HLDG 7.00 % 2/7/2038 9.00
LEHMAN BROS HLDG 7.00 % 2/8/2038 6.00
LEHMAN BROS HLDG 7.10 % 3/25/2038 7.25
LEHMAN BROS HLDG 7.25 % 2/27/2038 6.00
LEHMAN BROS HLDG 7.25 % 4/29/2038 8.75
LEHMAN BROS HLDG 7.35 % 5/6/2038 9.75
LEHMAN BROS HLDG 7.73 % 10/15/2023 5.83
LEHMAN BROS HLDG 7.88 % 8/15/2010 11.00
LEHMAN BROS HLDG 8.05 % 1/15/2019 5.06
LEHMAN BROS HLDG 8.50 % 8/1/2015 13.00
LEHMAN BROS HLDG 8.80 % 3/1/2015 11.90
LEHMAN BROS HLDG 8.92 % 2/16/2017 11.50
LEHMAN BROS HLDG 9.50 % 12/28/2022 6.20
LEHMAN BROS HLDG 9.50 % 1/30/2023 4.13
LEHMAN BROS HLDG 9.50 % 2/27/2023 7.50
LEHMAN BROS HLDG 10.00 % 3/13/2023 6.00
LEHMAN BROS HLDG 10.38 % 5/24/2024 7.80
LEHMAN BROS HLDG 11.00 % 10/25/2017 7.33
LEHMAN BROS HLDG 11.00 % 6/22/2022 7.50
LIFETIME BRANDS 4.75 % 7/15/2011 43.00
LOCAL INSIGHT 11.00 % 12/1/2017 24.50
MAGNA ENTERTAINM 8.55 % 6/15/2010 14.05
MAJESTIC STAR 9.50 % 10/15/2010 60.00
MAJESTIC STAR 9.75 % 1/15/2011 4.00
MASHANTUCKET PEQ 8.50 % 11/15/2015 22.13
MERCER INTL INC 9.25 % 2/15/2013 31.50
MERISANT CO 9.50 % 7/15/2013 7.06
MERRILL LYNCH 0.35 % 3/9/2011 87.09
METALDYNE CORP 11.00 % 6/15/2012 10.00
MILACRON ESCROW 11.50 % 5/15/2011 20.50
MILLENNIUM AMER 7.63 % 11/15/2026 7.00
MOMENTIVE PERFOR 11.50 % 12/1/2016 23.50
MORRIS PUBLISH 7.00 % 8/1/2013 5.00
NATL FINANCIAL 0.75 % 2/1/2012 38.00
NEFF CORP 10.00 % 6/1/2015 22.00
NETWORK COMMUNIC 10.75 % 12/1/2013 20.50
NEW PLAN EXCEL 4.50 % 2/1/2011 55.25
NEW PLAN EXCEL 7.40 % 9/15/2009 85.50
NEW PLAN EXCEL 7.50 % 7/30/2029 14.00
NEW PLAN REALTY 6.90 % 2/15/2028 13.13
NEW PLAN REALTY 6.90 % 2/15/2028 16.26
NEW PLAN REALTY 7.65 % 11/2/2026 18.18
NEW PLAN REALTY 7.68 % 11/2/2026 11.00
NEW PLAN REALTY 7.97 % 8/14/2026 16.00
NEWPAGE CORP 10.00 % 5/1/2012 53.00
NEWPAGE CORP 12.00 % 5/1/2013 30.50
NORTEK INC 8.50 % 9/1/2014 23.25
NORTH ATL TRADNG 9.25 % 3/1/2012 18.60
NORTHSTAR REAL 7.25 % 6/15/2027 42.11
NTK HOLDINGS INC 0.00 % 3/1/2014 10.00
OUTBOARD MARINE 9.13 % 4/15/2017 3.50
PALM HARBOR 3.25 % 5/15/2024 36.50
PANOLAM INDUSTRI 10.75 % 10/1/2013 5.00
PARK PLACE ENT 7.50 % 9/1/2009 71.31
PHH CORP 6.70 % 4/15/2010 77.58
PLY GEM INDS 9.00 % 2/15/2012 23.00
PREIT ASSOCIATES 4.00 % 6/1/2012 36.50
PRIMUS TELECOM 3.75 % 9/15/2010 2.63
PRIMUS TELECOM 8.00 % 1/15/2014 8.50
PRIMUS TELECOMM 14.25 % 5/20/2011 38.69
QUALITY DISTRIBU 9.00 % 11/15/2010 31.04
RADIAN GROUP 7.75 % 6/1/2011 58.26
RADIO ONE INC 6.38 % 2/15/2013 18.00
RADIO ONE INC 8.88 % 7/1/2011 39.50
RAFAELLA APPAREL 11.25 % 6/15/2011 19.75
RATHGIBSON INC 11.25 % 2/15/2014 23.25
RAYOVAC CORP 8.50 % 10/1/2013 11.11
READER'S DIGEST 9.00 % 2/15/2017 10.13
REAL MEX RESTAUR 10.00 % 4/1/2010 78.00
REALOGY CORP 10.50 % 4/15/2014 33.70
REALOGY CORP 12.38 % 4/15/2015 26.00
REALOGY CORP 12.38 % 4/15/2015 25.75
RENTECH INC 4.00 % 4/15/2013 29.52
RESIDENTIAL CAP 8.00 % 2/22/2011 36.50
RESTAURANT CO 10.00 % 10/1/2013 40.00
RH DONNELLEY 6.88 % 1/15/2013 7.50
RH DONNELLEY 6.88 % 1/15/2013 4.88
RH DONNELLEY 6.88 % 1/15/2013 7.75
RH DONNELLEY 8.88 % 1/15/2016 9.00
RH DONNELLEY 8.88 % 10/15/2017 8.25
RH DONNELLEY INC 11.75 % 5/15/2015 20.75
RITE AID CORP 8.13 % 5/1/2010 74.00
ROTECH HEALTHCA 9.50 % 4/1/2012 15.75
SALEM COMM HLDG 7.75 % 12/15/2010 30.00
SHENGDATECH INC 6.00 % 6/1/2018 56.04
SIMMONS BEDDING 7.88 % 1/15/2014 15.75
SINCLAIR BROAD 3.00 % 5/15/2027 69.88
SINCLAIR BROAD 6.00 % 9/15/2012 28.75
SIX FLAGS INC 4.50 % 5/15/2015 14.00
SIX FLAGS INC 8.88 % 2/1/2010 18.00
SIX FLAGS INC 9.63 % 6/1/2014 16.00
SIX FLAGS INC 9.75 % 4/15/2013 12.00
SPACEHAB INC 5.50 % 10/15/2010 59.00
SPANSION LLC 2.25 % 6/15/2016 1.44
SPHERIS INC 11.00 % 12/15/2012 37.75
STALLION OILFIEL 9.75 % 2/1/2015 22.88
STANDARD MTR 6.75 % 7/15/2009 90.50
STATION CASINOS 6.00 % 4/1/2012 31.00
STATION CASINOS 6.50 % 2/1/2014 4.88
STATION CASINOS 6.63 % 3/15/2018 6.35
STATION CASINOS 6.88 % 3/1/2016 7.00
STONE CONTAINER 8.38 % 7/1/2012 26.88
TEKNI-PLEX INC 12.75 % 6/15/2010 75.00
TEXAS UTILITIES 7.46 % 1/1/2015 31.02
THORNBURG MTG 8.00 % 5/15/2013 5.00
TIMES MIRROR CO 6.61 % 9/15/2027 2.60
TIMES MIRROR CO 7.25 % 3/1/2013 5.00
TIMES MIRROR CO 7.25 % 11/15/2096 4.25
TIMES MIRROR CO 7.50 % 7/1/2023 4.25
TOUSA INC 7.50 % 3/15/2011 1.00
TRIBUNE CO 4.88 % 8/15/2010 6.50
TRIBUNE CO 5.25 % 8/15/2015 5.25
TRIBUNE CO 5.67 % 12/8/2008 4.25
TRICO MARINE SER 6.50 % 5/15/2028 30.75
TRONOX WORLDWIDE 9.50 % 12/1/2012 19.88
TRUMP ENTERTNMNT 8.50 % 6/1/2015 8.88
UAL CORP 4.50 % 6/30/2021 40.00
UAL CORP 5.00 % 2/1/2021 45.00
UNISYS CORP 6.88 % 3/15/2010 82.75
UNISYS CORP 8.00 % 10/15/2012 48.25
US LEASING INTL 6.00 % 9/6/2011 45.25
USFREIGHTWAYS 8.50 % 4/15/2010 38.00
VERASUN ENERGY 9.38 % 6/1/2017 5.00
VERENIUM CORP 5.50 % 4/1/2027 17.00
VERSO PAPER 11.38 % 8/1/2016 35.00
VICORP RESTAURNT 10.50 % 4/15/2011 1.00
VION PHARM INC 7.75 % 2/15/2012 28.75
VISTEON CORP 7.00 % 3/10/2014 4.50
VISTEON CORP 12.25 % 12/31/2016 6.88
VOUGHT AIRCRAFT 8.00 % 7/15/2011 41.00
WASH MUT BANK NV 5.50 % 1/15/2013 0.00
WASH MUT BANK NV 5.55 % 6/16/2010 22.94
WASH MUT BANK NV 5.95 % 5/20/2013 0.90
WASH MUTUAL INC 4.20 % 1/15/2010 81.50
WASH MUTUAL INC 8.25 % 4/1/2010 61.25
WCI COMMUNITIES 4.00 % 8/5/2023 0.83
WCI COMMUNITIES 6.63 % 3/15/2015 2.00
WCI COMMUNITIES 7.88 % 10/1/2013 1.00
WCI COMMUNITIES 9.13 % 5/1/2012 0.25
WII COMPONENTS 10.00 % 2/15/2012 41.00
WILLIAM LYON 7.63 % 12/15/2012 24.25
WILLIAM LYONS 7.50 % 2/15/2014 24.37
WILLIAM LYONS 7.63 % 12/15/2012 23.50
WILLIAM LYONS 10.75 % 4/1/2013 31.00
XM SATELLITE 13.00 % 8/1/2013 43.38
*********
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.
The Sunday TCR delivers securitization rating news from the week
then-ending.
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. Ma. Theresa Amor J. Tan Singco, Ronald C. Sy, Joel Anthony
G. Lopez, Cecil R. Villacampa, Sheryl Joy P. Olano, Carlo
Fernandez, Christopher G. Patalinghug, and Peter A. Chapman,
Editors.
Copyright 2009. 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 ***