/raid1/www/Hosts/bankrupt/TCR_Public/090909.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, September 9, 2009, Vol. 13, No. 250
Headlines
ABITIBIBOWATER INC: Ernst & Young's Second Monitor's Report
ABITIBIBOWATER INC: ACI and ABI US Second Qtr. 2009 Results
ABITIBIBOWATER INC: Bowater Inc & Newsprint South 2nd Qtr Results
ABITIBIBOWATER INC: To Sell Manicouagan Power Plant for C$615MM
ABITIBIBOWATER INC: Turner Wants Prompt Sludge Pact Decision
ACCURIDE CORP: Pursues Restructuring Talks with Noteholder Group
AMEREX GROUP: VP McMahon, Sole Remaining Officer, Resigns
AMERICAN APPAREL: To Lay Off Part of Los Angeles Workforce
AMERICAN CAPITAL: Fitch Cuts IDR to 'CC' as Creditors Forbear
AMERICAN INT'L: Asset Sales Rise to $9.8 Billion on Pacific Deal
BASELINE OIL: Receives Court Approval for First Day Motions
BEARINGPOINT INC: Board Appoint John DeGroote as President
BEARINGPOINT INC: To Pay $450,000 Severance to Ex-CEO Harbach
BERNARD MADOFF: Fairfield Agrees to $8MM Settlement With State
BERNARD MADOFF: Geneva Funds of Hedge Funds Fail to Fix Losses
BIOJECT MEDICAL: Extends Promissory Note Maturity to Sept. 15
BIOPACK ENVIRONMENTAL: June 30 Balance Sheet Upside-Down by $2.6MM
CAROLINA WINE: Files for Bankruptcy Amid Drop in Fine Wine Demand
CARTERET ARMS: Court Approves Brach Eichler as Special Counsel
CARTERET ARMS: Can Hire Levy Ehrlich as Special Counsel
CARTERET ARMS: Court Approves Trenk DiPasquale as Counsel
CARTERET ARMS: Gets Temporary Nod to Use NYCB, UAC Cash Collateral
CATHOLIC CHURCH: Davenport Trustee Wants Hearing on Undertakings
CATHOLIC CHURCH: Fairbanks Diocese Seeks Aid From Supporters
CHEMTURA CORP: Amends Suit to Stop Diacetyl-Related Actions
CHEMTURA CORP: Court Sets October 30 Claims Bar Date
CHEMTURA CORP: Hires Deloitte AG as European Financial Advisor
CHEMTURA CORP: Proposes De Pardieu as French Counsel
CHEMTURA CORP: Seals Portions of Amended Schedules
CHIYODA AMERICA: Disclosure Statement Hearing Set for October 5
CHIYODA AMERICA: Selects Blank Rome as Counsel
CHRYSLER LLC: Retiree Trust Should Repay Creditors, Indiana Says
CIT GROUP: Analysts Believe Bankruptcy Can Still be Avoided
CITY CAPITAL: Has Yet to File 1st and 2nd Quarter 2009 Reports
CITY OF VALLEJO: Workers to Vote on CBA Rejection Appeal
COMMERCECONNECT MEDIA: Wins Confirmation of Reorganization Plan
COOPER-STANDARD: Canada Court Issues First Amended Initial Order
COOPER-STANDARD: CSA Canada Gets November 3 Extension of CCAA Stay
COOPER-STANDARD: CSA Canada to Draw $35MM From DIP Facility
COOPER-STANDARD: Proposes Foley & Lardner as Special Counsel
COOPER-STANDARD: Wants October 2 Extension for Schedules Filing
COSINE COMMUNICATIONS: Steel Partners et al., Disclose Stake
COYOTES HOCKEY: James Balsillie Ups Bid by $30 Million
CRUCIBLE MATERIALS: Two Serious Bidders Emerge
DAC TECHNOLOGIES: Has Going Concern Doubt, May Drop CIT as Factor
DELPHI CORP: Gets Court Nod for Shinwa Int'l Settlement
DRYSHIPS INC: COO Khanna to Present at Jefferies Shipping Confab
EASTWIND MARITIME: Trustee Wants to Let Go of Three Ships
ENERGAS RESOURCES: Engages Smith Carney as Public Accountants
ESCADA AG: Investors Present Offer; Plan Won't Need State Aid
FAIRFAX FINANCIAL: AM Best Assigns "bb+" Rating to Preferred Stock
FLEETWOOD ENTERPRISES: Izard Nobel Has Suit vs. Ex-Executives
FORMTECH INDUSTRIES: Gets Initial OK to Access $4.8MM DIP Loan
FORMTECH INDUSTRIES: Selects CM&D as Restructuring Officer
FREEDOM COMMUNICATIONS: Can Hire Logan & Company as Claims Agent
FREEDOM COMMUNICATIONS: Gets Temporary Nod to Use JPMorgan Cash
GENERAL GROWTH: Committee Members Want Trading In of Claims
GENERAL GROWTH: Proposes Nov. 10 Claims Bar Date
GENERAL GROWTH: Rouse Providence's Schedules of Assets & Debts
GENERAL GROWTH: Rouse Providence's Statement of Fin'l Affairs
GENERAL MOTORS: Global DiSCS Trust Says Recovery Amount at 12.63%
GENTA INC: Closes Sale of $10 Million in Units to Investors
GEORGIA GULF: Registers 1,326,862 Shares for Resale
GEORGIA GULF: Special Stockholders' Meeting on September 17
GLOBAL CROSSING: UK Unit Has GBP210-Mil. Total Deficit at June 30
H&W MOTORS: Appellate Court Upholds Prison Sentence for Former CEO
HELLER EHRMAN: Court Directs Creditors & Shareholders to Mediation
HOME INTERIORS: Creditors Settle with Highland Capital
HSH DELAWARE: Sent to Chapter 7 Liquidation by Creditors
IMAGINE ADOPTION: Could Emerge from Bankruptcy Next Month
INTRAOP MEDICAL: June 30 Balance Sheet Upside-Down by $6.13 Mil.
IVOICE INC: June 30 Balance Sheet Upside-Down by $2.42 Million
JEFFERSON COUNTY: Approves Forbearance on General Obligation Debt
JOHN GEORGE: Files for Chapter 7 Bankruptcy in Seattle
KRONOS INT'L: Lenders Waive Compliance for August 31 Test Period
LANDAMERICA FIN'L: Court OKs $10MM in Fees of Willkie Farr, et al.
LANDAMERICA FIN'L: LTC's Schedules of Assets & Debts
LANDAMERICA FIN'L: LTC's Statement of Financial Affairs
LEE ENTERPRISES: Again Meets NYSE Listing Standard
LEHMAN BROTHERS: LBI TRUSTEE Proposes SHG as Israeli Counsel
LEHMAN BROTHERS: LBI Trustee Proposes Menaker as Special Counsel
LEVERAGE GROUP: Founder Faces SEC Charges for Ponzi Scheme
LYONDELL CHEMICAL: Gets 45-Day Extension for Noteholder Bar
LYONDELL CHEMICAL: Parent Restarts Two French Refinery Units
LYONDELL CHEMICAL: MIP Payments to Sued Officers Placed in Escrow
LYONDELL CHEMICAL: Opposes Sec. 502(e) Environmental Claims
LYONDELL CHEMICAL: Proposes Joint Venture With Sumitomo
MAGNA ENTERTAINMENT: Sept. 8 Auction for Santa Anita Cancelled
MEDICURE INC: Defers $2.0MM Secured Debt Payment Until Nov. 30
MEDICURE INC: Posts C$13.3MM Loss for Fiscal Year Ended May 31
MERRILL LYNCH: Close to Suing BofA for Alleged Securities Fraud
MERILL LYNCH: To Pay $26.5MM to Settle Texas' Securities Complaint
MGM MIRAGE: Discloses Terms of Employment Pact With Gary Jacobs
MGM MIRAGE: Macau Gambling Revenue Market Share Up 11% in August
MICHAEL MCCULLOUGH: Section 341(a) Meeting Slated for October 1
MICHAEL MCCULLOUGH: Selects Spector Law Office as Counsel
MXENERGY INC: Maturity of Societe Generale Loan Moved to Sept. 21
MXENERGY HOLDINGS: Moves Exchange Offer Deadlines to Sept. 17
NESTOR INC: Goldman Capital Ceases to Hold Company Shares
NEW CENTURY COS: Restates Form 10-Q for First Quarter
NOVA HOLDING: Court Sets October 23 as Claims Bar Date
NOVA HOLDING: Has Until November 30 to File Chapter 11 Plan
NR GROUP: BK Opts Out of Deal with City of Alexandria
NV BROADCASTING: Plan Confirmation Hearing Slated for Sept. 10
OCCULOGIX INC: Existing Cash, Proceeds to Last Until End of 2009
OLD TIME POTTERY: Has Until Sept. 21 to File Schedules & Statement
OLD TIME POTTERY: Meeting of Creditors Scheduled for September 30
OLD TIME POTTERY: U.S. Trustee Appoints 5-Member Creditors Panel
OLD TIME POTTERY: Wants Access to SunTrust Bank's Cash Collateral
OLD TIME POTTERY: Taps Gullet Sanford as Counsel
OSCIENT PHARMACEUTICALS: Antara Auctions on Sept. 21
PHARMACEUTICAL ALTERNATIVES: Court Dismisses Check Lawsuit
PHILADELPHIA NEWSPAPERS: Hearing on Ads Controversy Today
PHILADELPHIA NEWSPAPERS: Sues Review Publishing to Collect Payment
PILGRIM'S PRIDE: In Talks of Selling Biz. to JBS SA, Says Report
PILGRIM'S PRIDE: Seeks Exclusivity Extension; Mum on JSB Talks
POLAROID CORP: To Auction Off Collection of Instant Images
RATHGIBSON INC: Offers to Pay Potential Lenders' Expenses
READER'S DIGEST: Proposes CMP as Conflicts Counsel
READER'S DIGEST: Wants to Employ Miller Buckfire as Advisor
READER'S DIGEST: Proposes to Reject 8 Non-Residential Leases
SARATOGA RESOURCES: Proved Reserves Top $500 Million
SAXBYS COFFEE: Blames Bankruptcy Due to Purchase-Related Suits
SBARRO INC: Paid $400,000 to Professionals on Loan Amendments
SEAWAY VALLEY: June 30 Balance Sheet Upside-Down by $18.5 Million
SEMGROUP LP: Seeks Injunction Against General Partner
SIGNATURE APPAREL: Hit With Involuntary Chapter 7 by Creditors
SPLASH POOL: Blames Bankr. on First Bank's Refusal to Renew Loan
SUN-TIMES MEDIA: Has 'Stalking Horse' Deal With J. Tyree
SUN-TIMES MEDIA: Tyree Buyout Won't Stop Losses, Experts Say
TAYLOR BEAN: Bankruptcy Filing Hits Illinois County
TEKNI-PLEX INC: Inks Separation Deal with COO Edward Goldberg
TELIPHONE CORP: June 30 Balance Sheet Upside-Down by $178,000
TRIANGLE PETROLEUM: Posts $232,352 Net Loss in Qtr. Ended July 31
TRIBUNE CO: Anti-Trust Office Won't Block Cubs Sale to Rickets
TRIBUNE CO: Committee Gets Court Nod for Zuckerman as Counsel
TRIBUNE CO: Sidley Austin Charges $1.6MM for July Work
TXCO RESOURCES: Creditors Oppose Extension of Plan Exclusivity
UNI-MARTS LLC: Lehigh-Led Auction Scheduled for Sept. 23
VELOCITY ENERGY: June 30 Balance Sheet Upside-Down by $5.8 Million
VERASUN ENERGY: FNBO Gets Lift Stay to Access L/C Collateral
VERASUN ENERGY: Proposes to Assign Pact to RBF Acquisition
VERASUN ENERGY: Wants Lift Stay to Disburse Funds
VERASUN ENERGY: Zurich American Wants Late Claims Accepted
X-RITE INC: Registers 58,150,640 Shares for Resale
YELLOWSTONE CLUB: Creditors Want Founder's El Tamarindo Resort
* August Bankruptcies Continue Leveling-Off Process; Up From 2008
* Banks Face Growing Regulatory Actions, Says MortgageDaily
* Upcoming Meetings, Conferences and Seminars
*********
ABITIBIBOWATER INC: Ernst & Young's Second Monitor's Report
-----------------------------------------------------------
Ernst & Young, Inc., in its capacity as information officer,
apprised Mr. Justice Gascon on August 14, 2009, of updates with
respect to the Chapter 11 proceedings of the AbitibiBowater Inc.'s
Canadian affiliates under its second monitor report.
E&Y disclosed that, among other things, the U.S. Bankruptcy Court
for the District of Delaware has:
(1) authorized the Chapter 11 Debtors to sell receivables
under an Amended and Restated Securitization Program;
(2) approved the Debtors' motion for the continued use of the
existing consolidated Cash Management System;
(3) approved the Cross-Border Protocol that will provide the
Bankruptcy Court and the Canadian Court with a framework
for the coordination of the administration of the Chapter
11 Proceedings and the CCAA Proceedings;
(4) authorized Bowater Alabama LLC to enter into an asset
purchase agreement, assume a related existing agreement
and otherwise consummate the purchase of a chip mill
facility for a purchase price of approximately
$2.45 million;
(5) approved the procedures for the Official Committee of
Unsecured Creditors to grant creditors access to
confidential information of the Debtors;
(6) appointed Direct Fee Review as fee auditor to review
compensation requests submitted by any professional in
connection with the Chapter 11 cases; and
(7) allowed for an extension of the Exclusivity Periods to
file a Chapter 11 plan or plans and to solicit acceptances
of that plan, through and including December 14, 2009, and
February 10, 2010; and
(8) allowed a 120-day extension, or until November 12, 2009,
of the time by which the Debtors may file notices of
removal in respect of claims and causes of action pending
as of the Petition Date.
A full-text copy of the August 14 Information Officer's Report is
available for free at:
http://bankrupt.com/misc/CCAA_2ndInfoOfficerReport.pdf
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 23
pulp and paper facilities and 29 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 third-party certified 100% of its managed
woodlands to sustainable forest management standards.
AbitibiBowater's shares trade over-the-counter on the Pink Sheets
and on the OTC Bulletin Board under the stock symbol ABWTQ.
The Company and several of its 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).
ABITIBIBOWATER INC: ACI and ABI US Second Qtr. 2009 Results
-----------------------------------------------------------
ABITIBI-CONSOLIDATED INC. & ABITIBIBOWATER US HOLDING LLC
Combined Balance Sheet Information
(Under Creditor Protection Proceedings as of Apr. 16 & 17, 2009)
As of June 30, 2009
ASSETS
Current Assets:
Cash and cash equivalents $132,000,000
Accounts receivable, net 347,000,000
Accounts receivable from affiliates 5,000,000
Inventories, net 333,000,000
Assets held for sale 409,000,000
Other current assets 20,000,000
---------------
Total Current Assets 1,246,000,000
Fixed assets, net 2,221,000,000
Amortizable intangible assets, net 464,000,000
Other assets 395,000,000
---------------
Total Assets $4,326,000,000
===============
LIABILITIES AND DEFICIT
Liabilities not subject to compromise:
Current Liabilities:
Accounts payable and accrued liabilities $237,000,000
Debtor-in-possession financing 30,000,000
Short-term bank debt 347,000,000
Current portion of long-term debt 633,000,000
Liabilities associated with assets
held for sale 60,000,000
---------------
Total Current Liabilities 1,307,000,000
Long-term debt, net 35,000,000
Pension & other postretirement projected
benefit obligations 79,000,000
Other long-term benefits 97,000,000
Deferred income taxes 40,000,000
---------------
Total Liabilities Not Subject to Compromise 1,558,000,000
Liabilities Subject to Compromise 3,211,000,000
---------------
Total Liabilities 4,769,000,000
Commitments and Contingencies
Deficit:
ACI and AbitibiBowater US Holding LLC
shareholders' deficit:
Common stock 2,288,000,000
Additional paid-in capital 377,000,000
Deficit (2,455,000,000)
Accumulated other comprehensive loss (724,000,000)
---------------
Total Bowater Inc. and Bowater Newsprint
South LLC shareholders' deficit (514,000,000)
Non-controlling interests 71,000,000
---------------
Total Deficit (443,000,000)
---------------
Total Liabilities and Deficit $4,326,000,000
===============
ABITIBI-CONSOLIDATED INC. & ABITIBIBOWATER US HOLDING LLC
Combined Statements of Operations Information
(Under Creditor Protection Proceedings as of Apr. 16 & 17, 2009)
Three Months Ended June 30, 2009
Sales $517,000,000
Cost and expenses:
Cost of sales 429,000,000
Depreciation, amortization and cost of timber 81,000,000
Distribution costs 62,000,000
Selling and admin. expenses 7,000,000
Closure costs, impairment & other 239,000,000
Net gain on disposition of assets -
---------------
Operating loss (301,000,000)
Interest expense (114,000,000)
Other (expense) income, net (19,000,000)
---------------
Loss before reorganization items
& income taxes (434,000,000)
Reorganization items, net (59,000,000)
---------------
Loss before income taxes (493,000,000)
Income tax benefit 39,000,000
---------------
Net loss including non-controlling interests (454,000,000)
Net loss (income) attributable
to non-controlling interests 1,000,000
---------------
Net loss attributable to ACI
& AbitibiBowater US Holding LLC ($453,000,000)
===============
ABITIBI-CONSOLIDATED INC. & ABITIBIBOWATER US HOLDING LLC
Combined Statements of Cash Flows Information
(Under Creditor Protection Proceedings as of April 16 & 17, 2009)
Three Months Ended June 30, 2009
Cash Flows from Operating Activities:
Net loss including non-controlling interests ($454,000,000)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Share-based compensation 2,000,000
Depreciation, amortization and cost of timber 81,000,000
Closure costs, impairment & other 239,000,000
Write-downs of mill stores inventory 7,000,000
Deferred income taxes (23,000,000)
Net pension contributions (111,000,000)
Net gain on disposition of assets 0
Gain on extinguishment of debt 0
Amortization of debt discount (premium), net 10,000,000
Loss (gain) on translation of
foreign currency debt (13,000,000)
Non-cash reorganization items, net 34,000,000
DIP financing costs 15,000,000
Changes in working capital:
Accounts receivable (35,000,000)
Inventories 13,000,000
Other current assets (1,000,000)
Accounts payable & accrued liabilities 107,000,000
Other, net 72,000,000
---------------
Net cash (used in) provided by
operating activities (57,000,000)
Cash Flows from Investing Activities:
Cash invested in fixed assets (19,000,000)
Dispositions of assets (1,000,000)
Decrease (increase) in deposit requirements
for letters of credit, net 54,000,000
Cash received in monetization of derivative
financial instruments 5,000,000
Other investing activities, net (3,000,000)
---------------
Net cash provided by (used in)
investing activities 36,000,000
Cash Flows from Financing Activities:
Cash dividends to non-controlling interests 0
DIP financing 30,000,000
DIP financing costs (16,000,000)
Term loan financing 0
Term loan payments 0
Short-term financing, net 0
Payments of long-term debt (2,000,000)
Payments of financing fees 0
Other financing activities, net (1,000,000)
--------------
Net cash provided by (used in)
financing activities 11,000,000
---------------
Net increase (decrease) in cash
& cash equivalents (10,000,000)
Cash & cash equivalents:
Beginning of period 142,000,000
---------------
End of period $132,000,000
===============
A full-text copy of the ACI Group's Financial Results for the 2nd
Quarter of 2009 is available at the SEC at:
http://ResearchArchives.com/t/s?4438
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 23
pulp and paper facilities and 29 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 third-party certified 100% of its managed
woodlands to sustainable forest management standards.
AbitibiBowater's shares trade over-the-counter on the Pink Sheets
and on the OTC Bulletin Board under the stock symbol ABWTQ.
The Company and several of its 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).
ABITIBIBOWATER INC: Bowater Inc & Newsprint South 2nd Qtr Results
-----------------------------------------------------------------
BOWATER INCORPORATED AND BOWATER NEWSPRINT SOUTH LLC
Combined Balance Sheet Information
(Under Creditor Protection Proceedings as of April 16 & 17, 2009)
As of June 30, 2009
ASSETS
Current Assets:
Cash and cash equivalents $347,000,000
Accounts receivable, net 321,000,000
Accounts receivable from affiliates 70,000,000
Inventories, net 331,000,000
Other current assets 78,000,000
---------------
Total Current Assets 1,147,000,000
Fixed assets, net 2,148,000,000
Goodwill 56,000,000
Other assets 252,000,000
---------------
Total Assets $3,603,000,000
===============
LIABILITIES AND DEFICIT
Liabilities not subject to compromise:
Current Liabilities:
Accounts payable and accrued liabilities $244,000,000
Debtor-in-possession financing 206,000,000
Short-term bank debt 325,000,000
---------------
Total Current Liabilities 775,000,000
Pension & other postretirement projected
benefit obligations 2,000,000
Other long-term benefits 23,000,000
Deferred income taxes 232,000,000
---------------
Total Liabilities Not Subject to Compromise 1,032,000,000
Liabilities Subject to Compromise 2,915,000,000
---------------
Total Liabilities 3,947,000,000
Commitments and Contingencies
Deficit:
Bowater Inc. and Bowater Newsprint South LLC
shareholders' deficit:
Common stock -
Exchangeable shares 173,000,000
Additional paid-in capital 2,125,000,000
Note receivable from AbitibiBowater Inc. (746,000,000)
Deficit (1,763,000,000)
Accumulated other comprehensive loss (202,000,000)
---------------
Total Bowater Inc. and Bowater Newsprint
South LLC shareholders' deficit (413,000,000)
Non-controlling interests 69,000,000
---------------
Total Deficit (344,000,000)
---------------
Total Liabilities and Deficit $3,603,000,000
===============
BOWATER INCORPORATED AND BOWATER NEWSPRINT SOUTH LLC
Combined Statements of Operations Information
(Under Creditor Protection Proceedings as of April 16 & 17, 2009)
Three Months Ended June 30, 2009
Sales $529,000,000
Cost and expenses:
Cost of sales 368,000,000
Depreciation, amortization and cost of timber 66,000,000
Distribution costs 57,000,000
Selling and admin. expenses 19,000,000
Closure costs, impairment & other
related charges 0
Net gain on disposition of assets (1,000,000)
---------------
Operating income 20,000,000
Equity in loss of Abitibi-Consolidated Inc. -
Interest expense (39,000,000)
Other (expense) income, net (8,000,000)
---------------
Loss before reorganization items
& income taxes (27,000,000)
Reorganization items, net (30,000,000)
---------------
Loss before income taxes (57,000,000)
Income tax provision (5,000,000)
---------------
Net loss including non-controlling interests (62,000,000)
Net loss (income) attributable
to non-controlling interests 3,000,000
---------------
Net loss attributable to Bowater Incorporated ($59,000,000)
and Bowater Newsprint South LLC ===============
BOWATER INCORPORATED AND BOWATER NEWSPRINT SOUTH LLC
Combined Statements of Cash Flows Information
(Under Creditor Protection Proceedings as of April 16 & 17, 2009)
Three Months Ended June 30, 2009
Cash Flows from Operating Activities:
Net loss including non-controlling interests ($62,000,000)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Share-based compensation 0
Depreciation, amortization and cost of timber 66,000,000
Write-downs of mill stores inventory 5,000,000
Deferred income taxes 8,000,000
Equity in loss of subsidiaries 0
Net pension contributions (18,000,000)
Net gain on disposition of assets (1,000,000)
Amortization of debt discount (premium), net 2,000,000
Loss (gain) on translation of foreign
currency debt 23,000,000
Non-cash reorganization items, net 12,000,000
DIP financing costs 14,000,000
Interest receivable from AbitibiBowater Inc. 0
Changes in working capital:
Accounts receivable 30,000,000
Inventories 3,000,000
Other current assets (27,000,000)
Accounts payable & accrued liabilities 65,000,000
Other, net 15,000,000
---------------
Net cash (used in) provided by
operating activities 135,000,000
Cash Flows from Investing Activities:
Cash invested in fixed assets (9,000,000)
Dispositions of assets 1,000,000
Increase in L/C deposit requirements, net (15,000,000)
---------------
Net cash provided by (used in)
investing activities (23,000,000)
Cash Flows from Financing Activities:
DIP financing 206,000,000
DIP financing costs (11,000,000)
Short-term financing, net 8,000,000
Payments of long-term debt 0
Payments of bank credit facility fees (7,000,000)
---------------
Net cash provided by (used in)
financing activities 196,000,000
---------------
Net increase (decrease) in cash
& cash equivalents 308,000,000
Cash & cash equivalents:
Beginning of period 39,000,000
---------------
End of period $347,000,000
===============
A full-text copy of the Bowater Group's financial results for the
2nd Quarter 2009 is available at the SEC at:
http://ResearchArchives.com/t/s?4439
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 23
pulp and paper facilities and 29 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 third-party certified 100% of its managed
woodlands to sustainable forest management standards.
AbitibiBowater's shares trade over-the-counter on the Pink Sheets
and on the OTC Bulletin Board under the stock symbol ABWTQ.
The Company and several of its 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).
ABITIBIBOWATER INC: To Sell Manicouagan Power Plant for C$615MM
---------------------------------------------------------------
After engaging in negotiations since March 2009, AbitibiBowater
has finally struck a deal for the sale of its 335-megawatt
Manicouagan power plant in Quebec to a joint venture formed by
Hydro-Quebec and Alcoa Inc. for C$615 million, Ross Marowits of
The Canadian Press reports.
The deal contemplates the transfer of AbitibiBowater's 60%
interest in the power plant to Quebec's public utility, Hydro-
Quebec; while the remaining 40% of the hydro asset will be held
by Alcoa, The Canadian Press relates.
Mr. Marowits further relates that the sale proceeds:
-- will be used, in part, to repay a C$100 million loan the
Company obtained the Bank of Montreal, which matures in
November 2009;
-- of about C$282 million will be reserved to "meet obligations
to Alcoa regarding potential tax consequences, pension and
other liabilities;" and
-- of about C$57 million will be used to "pay taxes incurred by
Alcoa as well as money owed for electricity purchased."
Another C$31 million of the sale proceeds will be set aside for
two years to cover indemnification obligations to Hydro-Quebec,
Mr. Marowits adds.
Subject to court and regulatory approvals, the proposed sale is
expected to close by October 15, 2009, according to the report.
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 23
pulp and paper facilities and 29 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 third-party certified 100% of its managed
woodlands to sustainable forest management standards.
AbitibiBowater's shares trade over-the-counter on the Pink Sheets
and on the OTC Bulletin Board under the stock symbol ABWTQ.
The Company and several of its 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).
ABITIBIBOWATER INC: Turner Wants Prompt Sludge Pact Decision
------------------------------------------------------------
AbitibiBowater Inc. and its affiliates and Turner Specialty
Services LLC entered into a Sludge Dewatering Project Agreement
No. BOW2013JP in January 2007. Pursuant to the Agreement, Turner
provided specialized dewatering services at the Debtors' paper
mill in Catawba, South Carolina.
The Agreement, which will expire by its terms on July 14, 2014,
may be terminated for any or no reason by either party to the
Agreement.
After the Petition Date, Turner notes that it continued to
provide services to the Debtor pursuant to the Agreement.
However, the Debtors failed to uphold their obligations under the
Agreement, owing Turner approximately $30,000 for postpetition
services, with additional expenses continuing to accrue on a
daily basis, on top of certain amounts still outstanding for
services provided by Turner prior to the Petition Date, Donna L.
Harris, Esq., at Pinckney, Harris & Weidinger, LLC in Wilmington,
Delaware, told the Court.
Ms. Harris further noted that Turner continues to provide highly
specialized services to the Debtors in accordance with the
Agreement. Thus, the Debtors continue to accrue monthly charges
for services rendered postpetition at an approximate rate of
$145,000.
The Postpetition Amounts should be paid in full and in cash as
administrative expense claim under Section 503(b) of the
Bankruptcy Code, for the full value of the services rendered and
which have accrued postpetition under the Agreement, Ms. Harris
contended.
As Turner has sustained, and continues to sustain, relatively
large economic losses due to the Debtors' failure to pay the
amounts owed, Turner asks the Court to compel the Debtors to
assume or reject the Sludge Dewatering Project Agreement.
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 23
pulp and paper facilities and 29 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 third-party certified 100% of its managed
woodlands to sustainable forest management standards.
AbitibiBowater's shares trade over-the-counter on the Pink Sheets
and on the OTC Bulletin Board under the stock symbol ABWTQ.
The Company and several of its 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).
ACCURIDE CORP: Pursues Restructuring Talks with Noteholder Group
----------------------------------------------------------------
A Special Committee of the Board of Directors of Accuride
Corporation and its advisors has agreed under the terms of a
forbearance agreement, to diligently pursue negotiations with
holders of the Company's 8-1/2% Senior Subordinated Notes due 2015
of a term sheet setting forth the terms of a restructuring of the
Company's obligations under the Notes and its Senior Credit
Facilities.
Stephen A. Martin, Accuride's Vice President and General Counsel,
said there can be no assurance that the Company's negotiations
with the informal committee of Note holders will be successful, or
that any strategic alternative will be implemented prior to the
expiration of the Forbearance Period.
As reported by the Troubled Company Reporter on September 1, 2009,
Accuride entered into a Forbearance Agreement with respect to its
8-1/2% Senior Subordinated Notes due 2015 issued pursuant to an
Indenture dated as of January 31, 2005, with The Bank of New York
Mellon Trust Company (f.k.a. The Bank of New York Trust Company,
N.A.), as Trustee. The Forbearance Agreement became effective on
August 31, 2009.
Pursuant to the terms of the Forbearance Agreement, the Note
holders executing the agreement agreed to forbear, and have
directed the Trustee to forebear, from exercising their rights and
remedies under the Indenture and the Notes with respect to the
Company's failure to pay $11.7 million in interest on the Notes
due August 3, 2009. The Company's failure to make the Note
Interest Payment by the expiration of the grace period would be an
immediate event of default under the Indenture.
The Forbearance Agreement terminates on September 30, 2009, unless
terminated earlier as the result of, among other things: (i) an
event of default under the Indenture that is not the Specified
Default, (ii) a breach by the Company of any of the covenants or
agreements provided in the Forbearance Agreement, (iii)
acceleration of the Company's obligations under the credit
agreement dated as of January 31, 2005, as amended from time to
time, among the Company, Accuride Canada Inc., the lenders,
Deutsche Bank Trust Company Americas (as successor to Citicorp
USA, Inc.), as the administrative agent, and other agent parties
thereto, by the Lenders and (iv) refusal of the Lenders to extend
the term of the Second Temporary Waiver Agreement, dated as of
August 14, 2009, by and among the Company, Accuride Canada Inc.,
the lenders party thereto and Citicorp USA, Inc., by September 15,
2009, until at least September 30, 2009, or otherwise grant an
additional waiver of default under the Senior Credit Facilities or
agree to forbear from taking any action with respect to any
default under the Senior Credit Facilities through and including
at least September 30, 2009.
The Forbearance Agreement was signed by Note holders participating
in the informal committee of Note holders, which was sufficient to
effectively preclude any action by Note holders to accelerate the
Notes during the term of the Forbearance Agreement.
The Forbearance Agreement also satisfies a condition for extending
the term of the Second Temporary Waiver Agreement until September
15, 2009, unless sooner terminated as provided for in the Second
Temporary Waiver Agreement. The Second Temporary Waiver Agreement
conditions the extension of the term of the Second Temporary
Waiver Agreement on, among other things, the Company obtaining a
temporary waiver or forbearance regarding the non-payment of the
Note Interest Payment, in form and substance reasonably
satisfactory to Deutsche and the Steering Committee, from the Note
holders no later than September 7, 2009. The Second Temporary
Waiver Agreement waives the Company's non-compliance with certain
financial covenants under the Credit Agreement for the fiscal
quarter end June 30, 2009, as described in the First Temporary
Waiver Agreement filed on July 9, 2009, and any default under
Section 7.01(e) of the Credit Agreement for failure of the Company
to make the Note Interest Payment, subject to the terms and
conditions set forth therein.
The Company is proactively evaluating strategic alternatives to
address ongoing liquidity and financing concerns, including
amendments and additional waivers to the Credit Agreement, the
sale of non-core assets or alternative debt structures. The
Company expects to use the term of the Forbearance Agreement to
continue working toward implementing one or more of these
strategic alternatives, and views the Forbearance Agreement as an
additional step in a broader transaction with its creditors,
including the Note holders, although the nature and parameters of
this transaction are not yet defined.
About Accuride
Accuride Corporation -- http://www.accuridecorp.com/-- is one of
the largest and most diversified manufacturers and suppliers of
commercial vehicle components in North America. Accuride's
products include commercial vehicle wheels, wheel-end components
and assemblies, truck body and chassis parts, seating assemblies
and other commercial vehicle components. Accuride's products are
marketed under its brand names, which include Accuride, Gunite,
Imperial, Bostrom, Fabco, Brillion, and Highway Original.
As of June 30, 2009, the Company had $704.7 million in total
assets; $732.0 million in total current liabilities and $114.0
million in other liabilities; and $141.4 million in stockholders'
deficiency.
As reported by the TCR on September 7, 2009, Moody's Investors
Service lowered Accuride's Probability of Default Rating and
Corporate Family Rating to Ca\LD and Ca, respectively. Moody's
believes that the company's continued financial difficulties
increase the likelihood of a distressed exchange or a bankruptcy
filing as the company seeks to restructure its business
AMEREX GROUP: VP McMahon, Sole Remaining Officer, Resigns
---------------------------------------------------------
Craig McMahon, Vice President, who is the sole remaining officer
of Amerex Group, Inc., on August 31, 2009, resigned his positions
as an officer of the Company and all its subsidiaries and
affiliated companies.
Stephen K. Onody, Interim President and CEO of Amerex Companies,
Inc., the Company's subsidiary, resigned his positions as an
officer of the subsidiary and all its subsidiaries and affiliated
companies, effective as of August 24, 2009.
The resignations were a result of the Company's senior secured
lender, CAMOFI Master, LDC, having taken control of the assets of
the Company's wholly owned subsidiary, Amerex Companies, Inc.,
including the stock of Amerex's wholly owned subsidiary, Waste
Express, Inc.
As reported by the Troubled Company Reporter, WES&A, LLC and
Amerex Group said effective as of August 24, 2009, CAMOFI has
taken control of the assets of Amerex Companies.
WES&A, LLC, a wholly owned affiliate of CAMOFI, will continue the
business operations of Amerex and Waste Express in their present
locations in Kansas City, MO, Tulsa, OK, Portland, OR and Phoenix,
AZ.
As of March 31, 2009, the Company had total assets of $3,784,646
and total liabilities of $20,264,426, and redeemable common stock
of $903,000.
Amerex Group, Inc. (OTCBB:AEXGE) -- http://www.amerexgroup.com/--
is a hazardous waste transportation and logistics firm with
capabilities to provide emergency response to environmental
emergencies. Amerex has administrative headquarters in Tulsa,
Oklahoma.
Going Concern Doubt
Sartain Fischbein & Co., in Tulsa, Oklahoma, expressed substantial
doubt about Amerex Group Inc.'s ability to continue as a going
concern after auditing the company's consolidated financial
statements for the year ended Dec. 31, 2007. The auditing firm
reported that the company incurred a net loss of $7,114,098 during
the year ended Dec. 31, 2007, and, as of that date, had a working
capital deficiency of $3,537,914 and stockholders' deficit of
$7,688,449. Additionally, the company has experienced significant
cash flow difficulties and is currently in default on its note
agreements.
AMERICAN APPAREL: To Lay Off Part of Los Angeles Workforce
----------------------------------------------------------
Miriam Jordan at The Wall Street Journal reports that American
Apparel Inc. will let go more than a quarter of its factory
workforce in Los Angeles amid a probe by the U.S. Immigration and
Customs Enforcement.
American Apparel, according to The Journal, said in July that it
had been notified by ICE that 1,600 of its 5,600 factory workers,
who are largely Hispanic immigrants, might be in the U.S.
illegally.
About 1,500 workers would be terminated in the coming weeks, The
Journal relates, citing an American Apparel spokesperson. The
Journal states that American Apparel CEO Dov Charney promised to
give the workers priority for jobs when "you are able to get your
immigration papers in order."
The Journal notes that American Apparel is likely to face
thousands of dollars in penalties for hiring workers who weren't
eligible to be employed. According to the report, the government
said that fines may exceed $800 per worker.
American Apparel, Inc. (NYSE Alternext US: APP) is a manufacturer,
distributor, and retailer of branded fashion basic apparel. Based
in downtown Los Angeles, California, American Apparel operates
more than 230 retail stores in 19 countries, including the United
States, Canada, Mexico, United Kingdom, Belgium, France, Germany,
Italy, the Netherlands, Spain, Sweden, Switzerland, Israel,
Australia, Japan, South Korea, Austria, China, and Brazil.
American Apparel also operates a leading wholesale business that
supplies T-shirts and other casual wear to distributors and screen
printers. In addition to its retail stores and wholesale
operations, American Apparel operates an online retail e-commerce
Web site at http://store.americanapparel.net/
As reported by the Troubled Company Reporter on November 18, 2008,
American Apparel said that it violated a covenant in its SOF
Credit Agreement that prohibited it from making capital
expenditures in excess of $50 million for the fiscal year ending
December 31, 2008. The default under the SOF Credit Agreement
also resulted in a cross default under the revolving credit
facility with LaSalle Bank.
On December 19, 2008, American Apparel said it has entered into
amendments to its revolving credit facility and its second lien
credit facility which extend the maturities of these loans for
three months. The amendments, which also modify certain covenants
and impose additional obligations, provide the company with the
ability to operate its business according to its plan while
continuing discussions with its lenders and other parties
regarding longer-term financing. The Company has filed copies of
these amendments and related documentation with the Securities and
Exchange Commission on a Form 8-K, available for free at:
http://researcharchives.com/t/s?3926
AMERICAN CAPITAL: Fitch Cuts IDR to 'CC' as Creditors Forbear
-------------------------------------------------------------
Fitch Ratings has downgraded American Capital Strategies LLC
(Nasdaq: ACAS) ratings as follows:
-- Issuer Default Rating (IDR) to 'CC' from 'B-';
-- Senior unsecured debt to 'B-/RR2' from 'B+/RR2'.
The ratings remain on Rating Watch Negative. Approximately $2.4
billion of debt is affected by this action.
The downgrade reflects acceleration of approximately $400 million
of privately placed unsecured debt and concurrent agreement with
these creditors to forbear from exercising their rights and
remedies.
Fitch has notched the senior unsecured debt rating above that of
the IDR and assigned a Recovery Rating (RR) of 'RR2' to reflect
that collateral available to the unsecured creditors, even on a
stressed basis, provides meaningful protection.
Failure of the company to execute a timely restructure with its
unsecured creditors would result in a downgrade to 'D'.
Alternatively, a coercive debt exchange (CDE) would result in a
rating of 'RD'. Fitch could consider the future modification or
extension of unsecured debt agreements as a CDE in accordance with
Fitch's CDE criteria, published March 3, 2009. However, Fitch
believes a renegotiation that does not result in a CDE or any
other form of default is possible.
Resolution of the Rating Watch Negative is primarily driven by the
outcome of ACAS's negotiations with unsecured creditors.
Under the terms of the privately placed unsecured debt, note-
holders were entitled to 'make-whole' payments of approximately
$21.6 million and default interest only following the acceleration
of the notes.
Terms of the forbearance agreement provide that a majority of
note-holders may elect to terminate the forbearance. Also, the
forbearance would terminate in the event of a bankruptcy filing,
if acceleration of the company's bank debt or other unsecured debt
occurs or if collateral is provided to other unsecured creditors.
Under the terms of the forbearance, the $21.6 million of make-
whole payments will be added to principal outstanding under the
applicable notes. ACAS also paid all accrued and unpaid interest
due as of Sept. 1, 2009 at the default rate on all of the notes
retroactive to March 30, 2009.
Fitch's rating definitions and the terms of use of such ratings
are available on the agency's public site, 'www.fitchratings.com'.
Published ratings, criteria and methodologies are available from
this site, at all times. Fitch's code of conduct, confidentiality,
conflicts of interest, affiliate firewall, compliance and other
relevant policies and procedures are also available from the 'Code
of Conduct' section of this site.
AMERICAN INT'L: Asset Sales Rise to $9.8 Billion on Pacific Deal
----------------------------------------------------------------
As reported by the Troubled Company Reporter on September 7,
American International Group Inc. has reached an agreement with
Bridge Partners LP, a company owned by Pacific Century Group, to
sell a portion of AIG Investments, its investment advisory and
asset management businesses, for an estimated $500 million. AIG
Investments' assets include private-equity funds, hedge funds of
funds, listed equities, and fixed income.
According to Zachary R. Mider and Hugh Son at Bloomberg News, AIG
has disclosed agreements to divest assets for about $9.8 billion
since it was bailed out by the U.S. government in September of
2008:
Price
Date Unit Buyer (in millions)
---- ---- ---- --------
9/29/08 London Airport stake Credit Suisse n/a
11/26/08 Stake in Brazil venture Unibanco 820
12/1/08 Private Bank Aabar 308
12/19/08 German insurance unit Augur Capital n/a
12/22/08 Hartford Steam Munich Re 815
1/13/09 Canadian life units Bank of Montreal 263
1/19/09 Commodity index unit UBS AG 15
1/23/09 Philippines units East-West Banking 49
2/5/09 Thai units Bank of Ayudhya 45
3/26/09 Taiwan securities unit Bank of E. Asia n/a
4/16/09 21st Century Insurance Zurich Financial 2,000*
5/11/09 Japanese headquarters Nippon Life 1,200
6/2/09 Argentina finance unit Banco de Galicia n/a
6/4/09 Transatlantic Holdings public offering 1,136
6/9/09 New York headquarters Kumho n/a
6/19/09 ForEx Platform BNP Paribas n/a
6/24/09 Mexican finance Afirme, Consorcio n/a
6/29/09 Russian bank Banque PSA n/a
6/30/09 Taiwan credit card unit Far Eastern n/a
7/28/09 Life insurance finance Wintrust 680
7/29/09 Polish consumer finance Banco Santander n/a
8/11/09 Energy assets multiple buyers 1,900
8/12/09 Hong Kong finance China Construct. 70
8/12/09 India information tech. Mphasis n/a
9/5/09 AIG Investments Pacific Century 500
------
TOTAL US$9,801
About American International
Based in New York, American International Group, Inc., is the
leading international insurance organization with operation in
more than 130 countries and jurisdictions. AIG companies serve
commercial, institutional and individual customers through the
most extensive worldwide property-casualty and life insurance
networks of any insurer. In addition, AIG companies are leading
providers of retirement services, financial services and asset
management around the world. AIG's common stock is listed on the
New York Stock Exchange, as well as the stock exchanges in Ireland
and Tokyo.
In September 2008, AIG experienced a liquidity crunch when its
credit ratings were downgraded below "AA" levels by Standard &
Poor's, Moody's Investors Service and Fitch Ratings. On
September 16, 2008, the Federal Reserve Bank created an
$85 billion credit facility to enable AIG to meet increased
collateral obligations consequent to the ratings downgrade, in
exchange for the issuance of a stock warrant to the Fed for 79.9%
of the equity of AIG. The credit facility was eventually
increased to as much as $182.5 billion. AIG has sold a number of
its subsidiaries and other assets to pay down loans received, and
continues to seek buyers of its assets.
The Troubled Company Reporter reported on March 4, 2009, that
Moody's Investors Service confirmed the A3 senior unsecured debt
and Prime-1 short-term debt ratings of American International
Group. AIG's subordinated debt rating has been downgraded to Ba2
from Baa1. The rating outlook for AIG is negative. This rating
action follows AIG's announcement of net losses of $62 billion for
the fourth quarter and $99 billion for the full year of 2008,
along with a revised restructuring plan supported by the U.S.
Treasury and the Federal Reserve. This concludes a review for
possible downgrade that was initiated on September 15, 2008.
BASELINE OIL: Receives Court Approval for First Day Motions
-----------------------------------------------------------
Baseline Oil & Gas Corp. said September 8 that Judge Jeff Bohm of
the U.S. Bankruptcy Court for the Southern District of Texas,
Houston Division, entered a series of interim orders on "first
day" motions that will facilitate Baseline's continued normal
business operations and reorganization efforts.
At the hearing held on September 1, 2009 to hear Baseline's first
day motions, Baseline received interim authorization to, among
other things, use the cash proceeds of existing bondholders'
collateral to satisfy operating expenses occurring in the ordinary
course of its business, including authorization: (i) to use and
maintain existing cash management systems and bank accounts; (ii)
to pay prepetition obligations owed to critical vendors; (iii) to
satisfy royalty obligations on account of prepetition and post-
petition sales of oil and gas; and (iv) to continue payment of
employee wages, health care coverage and similar benefits without
interruption.
In addition, the Court heard Baseline's emergency scheduling
motion and set a hearing date of September 25, 2009 to consider
both Baseline's prepetition solicitation and confirmation of its
prepackaged plan of reorganization.
About Baseline Oil
Baseline Oil & Gas Corp. (OTCBB:BOGA) is an independent oil and
natural gas company engaged in the exploration, production,
development, acquisition and exploitation of natural gas and crude
oil properties. The Company has interests in three core areas:
the Eliasville Field located in Stephens County in North Texas;
the Blessing Field in Matagorda County located onshore along the
Texas Gulf Coast, and the New Albany Shale play located in
Southern Indiana. Its core properties cover approximately 39,945
net acres. As of December 31, 2008, the Company's proved reserves
were 60.2 billion cubic feet equivalent (Bcfe), of which 46.5%
were natural gas and 68.2% were proved developed. During the year
ended December 31, 2008, it produced 2.8 Bcfe and had a proved
reserve reduction of 6.7 Bcfe as a result of reserve revisions.
Baseline Oil filed a voluntary petition for reorganization under
Chapter on August 28, 2009 (Bankr. S.D. Tex. Case No. 09-36291).
Attorneys at Thompson & Knight LLP represent Baseline Oil in its
restructuring effort.
Baseline Oil had total assets of $80,053,903 against total debts
of $138,913,478 as of June 30, 2009.
BEARINGPOINT INC: Board Appoint John DeGroote as President
----------------------------------------------------------
BearingPoint, Inc., reports that on August 28, 2009, the Board of
Directors of the Company appointed John DeGroote, 43, as the
Company's President effective as of August 31, 2009. Mr. DeGroote
will also continue to serve as the Company's Chief Legal Officer
and Secretary.
Mr. DeGroote was appointed as Chief Legal Officer of the Company
effective as of December 31, 2008, and as Secretary of the Company
effective as of May 27, 2009. Prior to his appointment as Chief
Legal Officer, Mr. DeGroote served as the Company's Deputy General
Counsel and Chief Litigation Counsel from 2004 until early 2008,
when he was promoted to General Counsel/Contracts, Litigation and
Risk.
About BearingPoint
BearingPoint, Inc. -- http://www.BearingPoint.com/-- was 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.
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, in Houston; Marcia J. Goldstein, Esq.,
Ronit J. Berkovich, Esq., and Jose R. Alcantar, Esq., at Weil
Gotshal & Manges LLP, in New York, represent the Debtors as
restructuring counsel. AlixPartners, LLP, is the Debtors'
restructuring advisors. Greenhill & Co., LLC, is the Debtor's
financial advisor & investment banker. Jeffrey S. Sabin, Esq., at
Bingham McCutchen LLP represents the Creditors' Committee as
counsel.
BearingPoint disclosed total assets of $1,762,689,000, and debts
of $2,231,839,000 as of September 30, 2008.
BEARINGPOINT INC: To Pay $450,000 Severance to Ex-CEO Harbach
-------------------------------------------------------------
F. Edwin Harbach ceased to serve as BearingPoint, Inc.'s Chief
Executive Officer and was terminated as an employee of the Company
effective as of the close of business on August 31, 2009. In
connection with this termination, on August 28, the Company and
Mr. Harbach agreed that Mr. Harbach will receive a severance
payment equal to six months base salary -- $450,107 -- inclusive
of any payment for accrued personal days, upon execution by
Mr. Harbach of a Severance and Release Agreement. The severance
payment is subject to approval by the Bankruptcy Court.
In addition, the Bankruptcy Court entered an order authorizing the
Company to implement, and the Board of Directors of the Company
approved, a Key Employee Incentive Plan on July 24. In connection
with Mr. Harbach's severance arrangement, the Board determined
that Mr. Harbach will be eligible to receive 5% of the total
amount of Wind Down Incentive Payments (which will be based on
actual recoveries to the Company's prepetition creditors)
available for distribution under the Plan.
About BearingPoint
BearingPoint, Inc. -- http://www.BearingPoint.com/-- was 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.
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, in Houston; Marcia J. Goldstein, Esq.,
Ronit J. Berkovich, Esq., and Jose R. Alcantar, Esq., at Weil
Gotshal & Manges LLP, in New York, represent the Debtors as
restructuring counsel. AlixPartners, LLP, is the Debtors'
restructuring advisors. Greenhill & Co., LLC, is the Debtor's
financial advisor & investment banker. Jeffrey S. Sabin, Esq., at
Bingham McCutchen LLP represents the Creditors' Committee as
counsel.
BearingPoint disclosed total assets of $1,762,689,000, and debts
of $2,231,839,000 as of September 30, 2008.
BERNARD MADOFF: Fairfield Agrees to $8MM Settlement With State
--------------------------------------------------------------
Fairfield Greenwich Advisors LLC and Fairfield Greenwich (Bermuda)
Ltd. agreed to pay a $500,000 fine and return money to
Massachusetts residents who invested with imprisoned Ponzi-scheme
operator Bernard Madoff.
An administrative complaint against Fairfield was filed alleging
that the hedge-fund manager failed to conduct due diligence on its
executing broker/sub advisor Bernard L. Madoff Investment
Securities LLC and subsequent misrepresentations to investors
regarding the "rigorous" due diligence Fairfield conducted. The
hedge-fund manager invested almost all of its $7.2 billion Sentry
Fund with Madoff. The Sentry funds have been offered and sold to
investors in The Commonwealth of Massachusetts.
Without admitting or denying the allegations, Fairfield has agreed
to the entry by the Office of the Secretary Commonwealth
Securities Division of an order consistent with Fairfield's offer
of settlement. According to the consent order signed by Secretary
of the Commonwealth William Galvin, Fairfield has agreed to (i)
cease and desist from further violations, (ii) pay a civil penalty
of $500,000, and (iii) pay restitution to all investors.
$8 Million Settlement
Jennifer Levitz at The Wall Street Journal reports that Fairfield
Greenwich Group has agreed to pay $8 million to settle civil fraud
charges by Massachusetts Secretary of State William Galvin for
being a feeder of investors to Bernard Madoff's ponzi scheme.
Fairfield Greenwich is considered to be the largest feeder of
investors to Mr. Madoff, says The Journal. Fairfield Greenwich
posted on its Web site that it had $6.9 billion of its $14 billion
in client assets invested with Mr. Madoff. The firm is facing a
$3.3 billion claim brought by a U.S. bankruptcy trustee in New
York on behalf of Bernard L. Madoff Investment Securities LLC, and
is also defending itself in a lawsuit brought by investors in U.S.
District Court in New York, The Journal states.
Citing Mr. Galvin, The Journal relates that the $8 million, less
the $500,000 paid to the state, will be shared among an estimated
15 Massachusetts investors that the state has been able to
identify as Madoff victims who invested through Fairfield
Greenwich. According to the report, the identified investors
included: Boston real-estate developer and entertainment
entrepreneur David G. Mugar who, along with entities connected to
his family, would get $1.2 million.
Mr. Galvin, The Journal states, said that the Massachusetts
investors who are part of the settlement will get "all their money
back, plus interest." The Journal says that under the settlement,
investors would get their invested sums, less any redemptions,
plus 6% annual interest.
According to The Journal, Fairfield Greenwich didn't admit nor
denied the charges. The company said in a statement that it
settled to "avoid drawn-out hearings and significant legal bills"
and is in discussions to settle claims "involving many more
investors."
The Journal states that Fairfield Greenwich executives had been
scheduled to appear for hearings with Massachusetts regulators on
Wednesday.
About Bernard L. Madoff
Bernard L. Madoff Investment Securities LLC was a market maker in
U.S. stocks, including all of the S&P 500 and more than 350 Nasdaq
stocks. The firm moved large blocks of stock for institutional
clients by splitting up orders or arranging off-exchange
transactions between parties. It also performed clearing and
settlement services. Clients included brokerages, banks, and
other financial institutions. In addition, Madoff Securities
managed assets for high-net-worth individuals, hedge funds, and
other institutional investors.
The firm is being liquidated in the aftermath of a fraud scandal
involving founder Bernard L. Madoff.
As reported by the Troubled Company Reporter on December 15, 2008,
the Securities and Exchange Commission charged Mr. Madoff and his
investment firm with securities fraud for a multi-billion dollar
Ponzi scheme that he perpetrated on advisory clients of his firm.
The estimated losses from Mr. Madoff's fraud were allegedly at
least US$50 billion.
Also on December 15, 2008, the Honorable Louis A. Stanton of the
U.S. District Court for the Southern District of New York granted
the application of the Securities Investor Protection Corporation
for a decree adjudicating that the customers of BLMIS are in need
of the protection afforded by the Securities Investor Protection
Act of 1970. Irving H. Picard, Esq., was appointed as trustee for
the liquidation of BLMIS, and Baker & Hostetler LLP was appointed
as counsel.
Judge Denny Chin of the U.S. District Court for the Southern
District of New York on June 29, 2009, sentenced Mr. Madoff to
150 years of life imprisonment for defrauding investors.
BERNARD MADOFF: Geneva Funds of Hedge Funds Fail to Fix Losses
--------------------------------------------------------------
Warren Giles at Bloomberg reports that Geneva-based hedge funds
have failed to repair the damage caused by market losses and
Bernard Madoff as investors withdrew money four times faster than
the global average in July. Mr. Giles notes that while the
strategy is designed to diversify risk and banks are responsible
for vetting fund managers, at least six Geneva-based institutions
reported Madoff-related losses. They include Union Bancaire
Privee, Banco Santander SA's Optimal Investment Services,
Genevalor Benbassat & Cie., Hyposwiss private bank, Banque
Benedict Hentsch & Cie., and Notz, Stucki & Cie.
Withdrawals climbed to $2 billion from $500 million in June,
according to data compiled by Eurekahedge Pte., which collects
data on hedge funds worldwide. Assets invested in Geneva-based
funds of hedge funds have slumped 74 percent to $14.2 billion
since the end of 2007.
About Bernard Madoff
Bernard L. Madoff Investment Securities LLC was a market maker in
U.S. stocks, including all of the S&P 500 and more than 350 Nasdaq
stocks. The firm moved large blocks of stock for institutional
clients by splitting up orders or arranging off-exchange
transactions between parties. It also performed clearing and
settlement services. Clients included brokerages, banks, and
other financial institutions. In addition, Madoff Securities
managed assets for high-net-worth individuals, hedge funds, and
other institutional investors.
The firm is being liquidated in the aftermath of a fraud scandal
involving founder Bernard L. Madoff.
As reported by the Troubled Company Reporter on December 15, 2008,
the Securities and Exchange Commission charged Mr. Madoff and his
investment firm with securities fraud for a multi-billion dollar
Ponzi scheme that he perpetrated on advisory clients of his firm.
The estimated losses from Mr. Madoff's fraud were allegedly at
least US$50 billion.
Also on December 15, 2008, the Honorable Louis A. Stanton of the
U.S. District Court for the Southern District of New York granted
the application of the Securities Investor Protection Corporation
for a decree adjudicating that the customers of BLMIS are in need
of the protection afforded by the Securities Investor Protection
Act of 1970. Irving H. Picard, Esq., was appointed as trustee for
the liquidation of BLMIS, and Baker & Hostetler LLP was appointed
as counsel.
As reported by the TCR, Judge Denny Chin of the U.S. District
Court for the Southern District of New York on June 29, 2009,
sentenced Mr. Madoff to 150 years of life imprisonment for
defrauding investors.
BIOJECT MEDICAL: Extends Promissory Note Maturity to Sept. 15
-------------------------------------------------------------
Bioject Medical Technologies Inc. on August 31, 2009, entered into
Convertible Subordinated Promissory Note Fourth Extension
Agreements with each of Life Sciences Opportunities Fund II
(Institutional), L.P. and Life Sciences Opportunities Fund II,
L.P., relating to those two Convertible Subordinated Promissory
Notes, dated as of December 5, 2007, issued by Bioject to the LOF
Funds in the aggregate principal amount of $600,000.
The Fourth Extensions extend the maturity date of the Notes from
August 31, 2009 to September 15, 2009.
Going Concern Doubt
As of June 30, 2009, the Company had $5.6 million in total assets;
$3.2 million in total current liabilities, $1.3 million in
deferred revenues, and $373,000 in other long-term liabilities;
and $636,000 in stockholders' equity. At June 30, 2009, cash and
cash equivalents totaled $1.3 million and accumulated deficit is
$121.6 million.
In its Form 10-Q report filed August 13, the Company noted that
due to its limited amount of additional committed capital,
recurring losses, negative cash flows and accumulated deficit, the
report of its independent registered public accounting firm for
the year ended December 31, 2008 expressed substantial doubt about
our ability to continue as a going concern.
The Company said it continues to monitor its cash and has taken
measures to reduce expenditure rate, delay capital and maintenance
expenditures and restructure its debt. However, even if it is
able to defer, convert or restructure debt, the Company expects
needing to do one or more of the following to provide additional
resources in the third quarter of 2009:
-- secure additional short-term debt financing;
-- secure additional long-term debt financing;
-- secure additional equity financing;
-- secure a strategic partner; or
-- reduce operating expenditures.
Bioject Medical Technologies Inc., based in Portland, Oregon,
develops and manufactures needle-free injection therapy systems.
Due to the Company's limited amount of additional committed
capital, recurring losses, negative cash flows and accumulated
deficit, the report of its independent registered public
accounting firm for the year ended December 31, 2008, expressed
substantial doubt about the Company's ability to continue as a
going concern.
BIOPACK ENVIRONMENTAL: June 30 Balance Sheet Upside-Down by $2.6MM
------------------------------------------------------------------
Biopack Environmental Solutions Inc.'s balance at June 30, 2009,
showed total assets of $2,879,174 and total liabilities of
$5,550,972, resulting in a stockholders' deficit of $2,671,798.
For three months ended June 30, 2009, the Company posted a net
loss of $565,266 compared with a net loss of $220,682 for the same
period in 2008.
For six months ended June 30, 2009, the Company posted a net loss
of $804,453 compared with a net loss of $1,095,720 for the same
period in 2008.
A full-text copy of the Company's Form 10-Q is available for free
at http://ResearchArchives.com/t/s?4457
Biopack Environmental Solutions Inc. (OTC BB: BPAC) --
http://www.biopackenvironmental.com/-- manufactures 100%
biodegradable consumer products from agricultural waste by
products.
Going Concern Doubt
Gruber & Company, LLC, in Lake Saint Louis, Missouri expressed
substantial doubt about Biopack's ability to continue as a going
concern after auditing the Company's consolidated financial
statements for the fiscal year ended December 31, 2008. The
auditor said the Company's ability to continue as a going concern
is dependent on its ability to generate sufficient cash flows to
meet its obligations and sustain its operations.
CAROLINA WINE: Files for Bankruptcy Amid Drop in Fine Wine Demand
-----------------------------------------------------------------
According to The News Observer, in Raleigh, North Carolina, Fine
wine dealer Carolina Wine Co. has sought bankruptcy protection
while its owner Robert C. Peel filed for personal bankruptcy.
Carolina Wine says creditors exceed 1,000, and its list of largest
creditors includes M. Easley at the Governor's Mansion in Raleigh
and an Itzhak Perlman in New York, N.Y.
Carolina Wine has been facing declining demand in its products due
to the present economic crisis. The News Observer relates that a
distributor sued Mr. Peel in August, claiming he paid for wine
with roughly 12 bounced checks.
The Bankruptcy Court, according to the report, has allowed lender
RBC Bank to seize all remaining wine at the Company to offset
$324,000 in debt. Judge A. Thomas Small has ordered RBC to pay
$25,000 plus rent, costs and utility claims against the estate in
exchange for all the remaining wine.
The Bankruptcy Court has allowed Mr. Peel to keep some remaining
assets. According to News Observer, Mr. Peel will keep his
$1 million house, which has a for-sale sign out front, a $350,000
property in Atlantic Beach, and 240 bottles of his own wine worth
$2,400. The properties are jointly owned with his wife, Laurie.
CARTERET ARMS: Court Approves Brach Eichler as Special Counsel
--------------------------------------------------------------
The U.S. Bankruptcy Court for District of New Jersey authorized
Carteret Arms LLC and Carteret Arms Management LLC to employ Brach
Eichler L.L.C., as their special counsel to performing corporate,
real estate, tax appeals and related legal services.
Papers filed with the Court did not show the firm's current hourly
rates for its professionals.
The Debtors assured the Court that he firm does not represent or
hold any interest adverse to the estate.
Plainfield, New Jersey-based Carteret Arms, LLC, and its
affiliates operate real estate businesses. Carteret Arms filed
for Chapter 11 bankruptcy protection on August 19, 2009 (Bankr. D.
N.J. Case No. 09-31726). The Company's affiliates also filed
separate Chapter 11 petitions. Richard D. Trenk, Esq., at Trenk,
DiPasquale, Webster, Della Fera & Sodono, P.C., assists Carteret
Arms in its restructuring efforts.
CARTERET ARMS: Can Hire Levy Ehrlich as Special Counsel
-------------------------------------------------------
The U.S. Bankruptcy Court for District of New Jersey authorized
Carteret Arms LLC and Carteret Arms Management LLC to employ Levy,
Ehrlich & Petriello, P.C., as their special counsel with respect
to landlord/tenant claims and disputes, municipal court matters,
"small claims" type cases, and Department of Community Affairs
administrative type matters.
Papers filed with the Court did not show the firm's current hourly
rates for its professionals.
The Debtors assured the Court that he firm does not represent or
hold any interest adverse to the estate.
Plainfield, New Jersey-based Carteret Arms, LLC, and its
affiliates operate real estate businesses. Carteret Arms filed
for Chapter 11 bankruptcy protection on August 19, 2009 (Bankr. D.
N.J. Case No. 09-31726). The Company's affiliates also filed
separate Chapter 11 petitions. Richard D. Trenk, Esq., at Trenk,
DiPasquale, Webster, Della Fera & Sodono, P.C., assists Carteret
Arms in its restructuring efforts.
CARTERET ARMS: Court Approves Trenk DiPasquale as Counsel
---------------------------------------------------------
The U.S. Bankruptcy Court for District of New Jersey authorized
Carteret Arms LLC and Carteret Arms Management LLC to employ
Trenk, DiPasquale, Webster, Della Fera & Sodono, P.C., as their
counsel.
The firm has agreed to:
a) advise the Debtors with respect to the power, duties and
responsibilities in the continued management of its
properties and financial affairs as debtor, including the
rights and remedies of the Debtors-In-Possession with
respect to its assets and with respect to the claims of
creditors;
b) advise the Debtors with respect to preparing and obtaining
approval of a Disclosure Statement and Plan of
Reorganization;
c) prepare on behalf of the Debtors, as necessary
applications, motions, complaints, answers, orders, reports
and other pleadings and documents;
d) appear before this Court and other officials and tribunals,
if necessary, and protecting the interests of the Debtors in
federal, state and foreign jurisdictions and administrative
proceedings;
e) negotiate and prepare documents relating to the use,
reorganization and disposition of assets, as requested by
the Debtors;
f) negotiate and formulate a Disclosure Statement and Plan
of Reorganization;
g) advise the Debtors concerning the day-to-day operations of
its business and the administration of its estate as
debtors-in-possession; and
h) perform other legal services for the Debtors, as may be
necessary and appropriate herein.
Papers filed with the Court did not show the firm's current hourly
rates for its professionals.
The Debtors assured the Court that he firm does not represent or
hold any interest adverse to the estate.
Plainfield, New Jersey-based Carteret Arms, LLC, and its
affiliates operate real estate businesses. Carteret Arms filed
for Chapter 11 bankruptcy protection on August 19, 2009 (Bankr. D.
N.J. Case No. 09-31726). The Company's affiliates also filed
separate Chapter 11 petitions. Richard D. Trenk, Esq., at Trenk,
DiPasquale, Webster, Della Fera & Sodono, P.C., assists Carteret
Arms in its restructuring efforts.
CARTERET ARMS: Gets Temporary Nod to Use NYCB, UAC Cash Collateral
------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of New Jersey
authorized, on an interim basis, Carteret Arms, LLC, and its
affiliates to:
-- use cash securing repayment of loans with The New York
Community Bank and Urban American Capital, L.L.C.; and
-- grant adequate protection to secured lenders.
A final hearing on the cash collateral is set for Sept. 25, 2009,
at 11:00 a.m. at Courtroom 3A of the U.S. Bankruptcy Court,
Trenton, New Jersey. Objections, if any, are due on Sept. 18,
2009.
The Debtors relate that they do not have sufficient unencumbered
cash or other assets with which to continue to operate businesses
in Chapter 11.
NYCB and UAC asserted secured claims against the Debtors in the
principal amounts of $13.0 million and $1.2 million, respectively,
as of the petition date.
As adequate protection, the Debtor will grant the secured lenders
replacement liens, super-priority administrative expense claim,
senior to any and all claims against the Debtors.
About Carteret Arms, LLC
Plainfield, New Jersey-based Carteret Arms, LLC, and its
affiliates operate real estate businesses. Carteret Arms filed
for Chapter 11 bankruptcy protection on August 19, 2009 (Bankr. D.
N.J. Case No. 09-31726). The Company's affiliates also filed
separate Chapter 11 petitions. Richard D. Trenk, Esq., at Trenk,
DiPasquale, Webster, Della Fera & Sodono, P.C., assists Carteret
Arms in its restructuring efforts.
CATHOLIC CHURCH: Davenport Trustee Wants Hearing on Undertakings
----------------------------------------------------------------
Robert L. Berger, the Diocese of Davenport's settlement trustee,
asks the U.S. Bankruptcy Court for the Southern District of Iowa
to set a hearing to allow inquiry of the Reorganized Debtor, and
in particular, Bishop Martin Amos, with respect to the Reorganized
Debtor's Report on Non-Monetary Undertakings filed on June 5,
2009.
Mr. Berger contends that the Diocese and the Catholic Entities
failed to file the Report as required by the Debtor's confirmed
Plan of Reorganization, and to comply with certain of the
Diocese's obligations under Article 24 of the Plan. He explains
that, for instance, (i) the Bishop failed to publicly support the
complete elimination of all criminal statutes of limitations for
child sexual abuse, and (ii) the Diocese failed to disclose priest
affidavits and make those affidavits meaningful, among other
failures.
Because the Official Committee of Unsecured Creditors was
dissolved on the Plan's Effective Date and because Mr. Berger's
counsel, Pachulski Stang Ziehl & Jones LLP, was employed, among
other things, to communicate with the Diocese and Tort Claimants
regarding compliance with Article 24, Mr. Berger asks the Court
for a hearing for parties-in-interest to examine Bishop Amos
regarding the Report and the Diocese's Article 24 obligations.
Mr. Berger submits that Bishop Amos should be present at the
hearing to be questioned because the Bishop committed to address
parishioner questions and comments as part of the Plan process.
Mr. Berger proposes to serve notice of the hearing on all of
claimants, who filed claims in the bankruptcy case, so that they
will have an opportunity to be heard at the hearing.
* * *
The Court will commence a hearing on October 7, 2009, at 2:00 p.m.
to consider Mr. Berger's concerns. In addition, the Court
directed the Reorganized Debtor to clarify what non?monetary
contributions the Catholic Entities made during the first year
under the Confirmed Plan.
About Diocese of Davenport
The Diocese of Davenport in Iowa filed for chapter 11 protection
(Bankr. S.D. Ia. Case No. 06-02229) on Oct. 10, 2006. Richard A.
Davidson, Esq., at Lane & Waterman LLP, represents the Davenport
Diocese in its restructuring efforts. Hamid R. Rafatjoo, Esq.,
and Gillian M. Brown, Esq., at Pachulski Stang Zhiel Young Jones &
Weintraub LLP represent the Official Committee of Unsecured
Creditors. In its schedules of assets and liabilities, the
Davenport Diocese reported $4,492,809 in assets and $1,650,439 in
liabilities. The Court approved on April 3, 2008, the Diocese of
Davenport's second amended disclosure statement explaining its
joint plan of reorganization. The Committee is a proponent to the
plan, which was confirmed on April 30, 2008. (Catholic Church
Bankruptcy News, Issue No. 129; Bankruptcy Creditors' Service
Inc.; http://bankrupt.com/newsstand/or 215/945-7000).
CATHOLIC CHURCH: Fairbanks Diocese Seeks Aid From Supporters
------------------------------------------------------------
Bishop Donald Kettler of The Catholic Bishop of Northern Alaska
sent a bulk mailing to 55,000 diocesan supporters around the
world, seeking money to help the missionary diocese overcome its
financial woes, reports Juneau Empire.
Bishop Kettler said the fiscal crisis stems from legal fees of
their bankruptcy reorganization; rising fuel and maintenance
costs; staff travel expenses to cover the sprawling diocese; and
the national economic downturn which has decimated investment
returns, notes the report.
Although Bishop Kettler calls the letter a "special request" for
donations, he said it is not unusual, says Mary Beth Smetzer of
newsminer.com.
"We stay alive because of letters like this. This is how we
provide for our missionary work. It's through donors. That's how
we survive as a missionary diocese," newsminer.com quotes Bishop
Kettler as saying.
During the last half dozen years, the Fairbanks Diocese has
incurred millions of dollars in attorney fees dealing with about
300 lawsuits alleging clerical sexual abuse of minors and in its
ongoing reorganization after filing for Chapter 11 in March 2008,
according to reports.
"The clock is always ticking on attorney fees," Fairbanks'
Diocesan Chancellor Robert Hannon said, notes Ms. Smetzer. "I
know we have incurred more than $2 million in fees to date and
part has been paid from a loan and proceeds from the sale of
property. Some of the fees won't be paid until the reorganization
concludes."
Fairbanks' diocesan belt tightening began in May when employees
took a 20 percent salary reduction and shortened work hours.
Other unnecessary expenses were cut back, and employees in
regional centers made separate cutbacks, reports Ms. Smetzer.
Bishop Kettler also eliminated some of his support staff and some
diocesan programs. Cut were three full-time positions: senior
accountant, maintenance assistant and engineering management
associate, and a part-time Alaskan Shepherd clerk, Ms. Smetzer
continues. The librarian/archives clerk post was reduced to part
time, and the remaining Alaskan Shepherd clerks' work hours were
reduced to 30 hours per week. The bishop, executive secretary,
chancellor and receptionist have taken a 20 percent pay cut and
the director of finance, a 25 percent pay cut.
At the beginning of July, the Office of Worship and the Office of
Children and Family Life at the chancery were closed, notes the
report. However, the Tribunal Office will take over the key
responsibilities of victim assistance coordination.
"We hope that all our efforts with reorganization will eventually
lead to healing by everyone who has been hurt by this whole
situation," Bishop Kettler said, reports newsminer.com.
To recall, The Catholic Bishop of Northern Alaska delivered to the
U.S. Bankruptcy Court for the District of Alaska its Plan of
Reorganization and accompanying Disclosure Statement on March 31,
2009. Subsequently, CBNA delivered to the Court its First Amended
and Restated Plan and Disclosure Statement on May 14, 2009, as a
result of some feedback CBNA received at mediations held on April
20 and 21.
The Court commenced a hearing on June 18, 2009, to consider the
adequacy of the Disclosure Statement. In a proceeding memo filed
with the Court on the same day, Judge MacDonald held that the
Court has heard the arguments of the parties, and that the matter
is "taken under advisement."
About Diocese of Fairbanks
The Roman Catholic Diocese of Fairbanks in Alaska, aka Catholic
Bishop of Northern Alaska, aka Catholic Diocese of Fairbanks, aka
The Diocese of Fairbanks, aka CBNA -- http://www.cbna.info/--
filed for chapter 11 bankruptcy on March 1, 2008 (Bankr. D. Alaska
Case No. 08-00110). Susan G. Boswell, Esq., at Quarles & Brady
LLP represents the Debtor in its restructuring efforts. Michael
R. Mills, Esq., of Dorsey & Whitney LLP serves as the Debtor's
local counsel and Cook, Schuhmann & Groseclose Inc. as its special
counsel. Judge Donald MacDonald, IV, of the United States
Bankruptcy Court for the District of Alaska presides over
Fairbanks' Chapter 11 case. The Debtor's schedules show total
assets of $13,316,864 and total liabilities of $1,838,719.
The church's plans to file its bankruptcy plan and disclosure
statement on July 15, 2008. Its exclusive plan filing period
expires on January 15, 2009. (Catholic Church Bankruptcy News;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
CHEMTURA CORP: Amends Suit to Stop Diacetyl-Related Actions
-----------------------------------------------------------
Chemtura Corp. and its affiliates submitted an amended complaint
in mid-July 2009 and an amended request for a preliminary
injunction, asking the Bankruptcy Court to declare that the
automatic stay extends to the commencement or continuation of
pending diacetyl-related actions against Chemtura Canada
Corporation, Citrus & Allied Essences, Ltd., and Ungerer & Company
until the effective date of a Chapter 11 plan of reorganization.
As previously reported, Karen Smith and several other individuals
have commenced diacetyl-related actions in various courts in
Illinois, Missouri, Ohio, Wisconsin, and California. Under their
Adversary Complaint, the Debtors specifically ask the Bankruptcy
Court to:
-- declare that their efforts to remove and transfer the
Diacetyl Litigation to the Southern District of New York
are not subject to the automatic stay, including removal
and transfer of claims against Chemtura Canada, Citrus, and
Ungerer; and
-- enjoin the Diacetyl Claimants from seeking discovery from
them or their affiliate, Chemtura Canada, in the Diacetyl
Litigation or future Diacetyl Actions until the effective
date of a Chapter 11 plan yet to be filed in their cases or
a final order of the Court.
A full-text copy of the Amended Complaint is available for free
at http://bankrupt.com/misc/ChemSmith1stAmCom.pdf
A full-text copy of the Amended Injunction Request is available
for free at http://bankrupt.com/misc/ChemSmithAmInj.pdf
In support of their Amended Injunction Request, the Debtors said
that they will file a memorandum. They, however, sought
authority from the Court to file the memorandum document under
seal, asserting that the Document contains confidential
information which should not be available to the public. The
Court granted the sealing of the Memorandum Document.
Parties Respond
In separate filings, several parties generally asked the Court to
deny the Debtors' requests under the Amended Complaint relating
to the Diacetyl Actions. They include:
(1) Irma Ortiz, Victor Mancilla, and Ricardo Corona;
(2) Karen Smith and certain other Diacetyl Claimants;
(3) Michael Robinson and Linda Robinson;
(4) Francisco Herrera; and
(5) Karen Geile, Georgia Hawthorne, Carolyn Kiefer, Sara Lane,
Reschane Thitakom, Marjorie Turnbough, Mary Whiteside,
Lauren Elder, and Pamela Wibbenmeyer.
With regard to the Amended Injunction Request, Ungerer and
Citrus, in separate filings, told the Court they support the
Debtors' request. However, Karen Smith, Irma Ortiz, and the Ad
Hoc Committee of Tort Claimants asked the Court to deny the
Debtors' injunction request. Karen Smith and certain other
Diacetyl Claimants sought and obtained authority from the Court
to file their responses to the Amended Injunction Request under
seal.
Parties Stipulate on Confidentiality
The Debtors and the Diacetyl Claimants entered into a Court-
approved stipulation in order to expedite the exchange of
discovery materials, to facilitate the prompt resolution of
disputes over confidentiality, and to protect discovery material
entitled to be kept confidential.
The Parties agree that a person may designate discovery material,
like answers to interrogatories and requests for admission, as
"Confidential" if that person believes in good faith that the
Discovery Material constitutes or includes information that has
not been made public and that the Producing Person would not make
public in the ordinary course of its activities, including but
not limited to technical, business, financial, personal or other
information.
Materials considered "Confidential" will be made available only
to, among others, the Stipulating Parties and their counsel;
testifying and consulting experts; any person who is identified
as a witness at a deposition or hearing, provided that the
witness may not maintain any Confidential Material in his or her
possession; and the Court, its officers and clerical staff.
FONA Seek Dismissal of Complaint
FONA International, Inc., one of the defendants, asks the
Bankruptcy Court to dismiss the Debtors' Adversary Complaint
based on a lack of subject matter jurisdiction.
FONA is an Illinois company that manufactures flavors and has, at
relevant times, purchased diacetyl from Citrus. FONA, however,
has never purchased diacetyl from the Debtors.
FONA has been named as a defendant in various diacetyl cases and
as part of its defense, FONA has third-partied in or cross-
claimed against its diacetyl suppliers, including Citrus. Upon
being named as a third party defendant, Citrus has asserted
cross-claims or fourth party claims against the Debtors for
indemnity or contribution.
Ronald B. Lee, Esq., at Roetzel & Andress LPA, in Akron, Ohio,
contends that the Debtors' Complaint fails to state a claim upon
which relief may be granted. He points out that Citrus is an
independent company with no corporate affiliation with the
Debtors.
Citrus is a distributor and manufacturer of chemicals and was a
major distributor of diacetyl for the Debtors. Citrus was the
Debtors' primary customer and exclusive reseller of diacetyl in
the United States.
Mr. Lee argues that there is no indemnification agreement between
the Debtors and Citrus that would automatically impose liability
on the Debtors if FONA were to obtain a judgment against Citrus.
About Chemtura Corp.
Based in Middlebury, Connecticut, Chemtura Corporation (CEM) --
http://www.chemtura.com/-- with 2008 sales of $3.5 billion, is a
global manufacturer and marketer of specialty chemicals, crop
protection products, and pool, spa and home care products.
Chemtura Corporation and 26 of its U.S. affiliates filed voluntary
petitions for relief under Chapter 11 on March 18, 2009 (Bankr.
S.D.N.Y. Case No. 09-11233). M. Natasha Labovitz, Esq., at
Kirkland & Ellis LLP, in New York, serves as bankruptcy counsel.
Wolfblock LLP serves as the Debtors' special counsel. The
Debtors' auditors and accountant are KPMG LLP; their investment
bankers are Lazard Freres & Co.; their strategic communications
advisors are Joele Frank, Wilkinson Brimmer Katcher; their
business advisors are Alvarez & Marsal LLC and Ray Dombrowski
serves as their chief restructuring officer; and their claims and
noticing agent is Kurtzman Carson Consultants LLC.
As of December 31, 2008, the Debtors had total assets of
$3.06 billion and total debts of $1.02 billion.
Bankruptcy Creditors' Service, Inc., publishes Chemtura
Bankruptcy News. The newsletter tracks the Chapter 11
proceedings undertaken by Chemtura Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
CHEMTURA CORP: Court Sets October 30 Claims Bar Date
----------------------------------------------------
Judge Robert E. Gerber of the U.S. Bankruptcy Court for the
Southern District of New York has set October 30, 2009, as the
last date for creditors and parties-in-interest to filed proofs
of claim against the Debtors.
The Court's ruling is without prejudice to the Debtors' right to
seek further extensions of the Claims Bar Date.
Before the entry of the Court's ruling, Judge Gerber overruled
the objections filed by:
(a) Karen Smith and certain other diacetyl plaintiffs and the
International Brotherhood of Teamsters;
(b) the Ad Hoc Committee of Tort Claimants; and
(c) Irma Ortiz, Victor Mancilla, and Ricardo Corona.
The Objecting Parties generally argued that the Debtors' Bar Date
request was premature and a bold attempt to cut off the rights of
prospective personal injury claimants without adequate notice or
due process.
The Debtors responded by pointing out that they have always
proposed site-specific noticing with respect to diacetyl along
with other potential sources of exposure. "Simply put, the
Diacetyl Claimants just missed the site-specific notices attached
as exhibits to the Bar Date Motion that are expressly targeted to
reach people who may have been exposed to diacetyl," Richard M.
Cieri, Esq., at Kirkland & Ellis LLP, in New York, said, on the
Debtors' behalf.
In relation to the setting of the Bar Date, Chemtura Corp. Chief
Executive Officer Craig Rogerson said, in an interview with ICIS,
that his company is right on track with its plan for a March 2010
Chapter 11 exit. In the interview, Mr. Rogerson noted that the
Debtors have already sent a five-year business plan to unsecured
creditors.
About Chemtura Corp.
Based in Middlebury, Connecticut, Chemtura Corporation (CEM) --
http://www.chemtura.com/-- with 2008 sales of $3.5 billion, is a
global manufacturer and marketer of specialty chemicals, crop
protection products, and pool, spa and home care products.
Chemtura Corporation and 26 of its U.S. affiliates filed voluntary
petitions for relief under Chapter 11 on March 18, 2009 (Bankr.
S.D.N.Y. Case No. 09-11233). M. Natasha Labovitz, Esq., at
Kirkland & Ellis LLP, in New York, serves as bankruptcy counsel.
Wolfblock LLP serves as the Debtors' special counsel. The
Debtors' auditors and accountant are KPMG LLP; their investment
bankers are Lazard Freres & Co.; their strategic communications
advisors are Joele Frank, Wilkinson Brimmer Katcher; their
business advisors are Alvarez & Marsal LLC and Ray Dombrowski
serves as their chief restructuring officer; and their claims and
noticing agent is Kurtzman Carson Consultants LLC.
As of December 31, 2008, the Debtors had total assets of
$3.06 billion and total debts of $1.02 billion.
Bankruptcy Creditors' Service, Inc., publishes Chemtura
Bankruptcy News. The newsletter tracks the Chapter 11
proceedings undertaken by Chemtura Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
CHEMTURA CORP: Hires Deloitte AG as European Financial Advisor
--------------------------------------------------------------
Chemtura Corp. and its affiliates sought and obtained the U.S.
Bankruptcy Court's authority to employ Deloitte AG, as its
European financial advisory services provider, nunc pro tunc to
June 5, 2009.
As the Debtors' European financial advisor, Deloitte AG will:
(a) assist the Debtors in understanding an appropriate
methodology to the valuation of intercompany receivables,
specifically intercompany receivables owed by the Debtors
and held by Swiss entities in accordance with SWISS GAAP
in Switzerland;
(b) assist the Debtors in assessing the financial position of
the relevant members of Chemtura Europe Group and
preparing the interim balance sheet and appropriate
supporting documentation that may be used in meeting its
statutory audit responsibilities, if appropriate;
(c) assist the Debtors in analyzing the cascading effect of
the analysis in the context of the overall Chemtura Europe
Group's indebtedness;
(d) assist the Debtors in developing planning options to deal
with and resolve any issues that might develop in the
context of the Debtors' indebtedness, which options may
include the solvent or insolvent restructuring of
entities;
(e) assist the Debtors in developing an understanding of the
evidence that must be provided to its statutory auditors
to support the value attributed to horizontal loans, cash
pool receivables or payables and for other intercompany
financing facilities;
(f) assist the Debtors in developing an understanding of the
different valuation approaches that might be available in
the context of Swiss tax/statutory planning;
(g) assist the Chemtura Europe Group to liaise with its
statutory auditors in order to address their concerns
regarding the "going concern" test with a view to
obtaining unqualified and timely audited accounts in all
European jurisdictions; and
(h) assist the Debtors' legal counsel with respect to certain
matters relevant to other tasks.
The Debtors will pay Deloitte AG's services on an hourly basis
and will reimburse the firm's actual and necessary out-of-pocket
expenses. Deloitte AG's hourly rates are:
Europe Staff United Kingdom Staff
------------ --------------------
Partner CHF818 GBP668
Associate Partner CHF716 GBP668
Director CHF674 GBP559
Assistant Director CHF572 GBP454
Manager CHF460 GBP405
Senior CHF296 GBP188
Assistant CHF126 GBP154
Howard Da Silva, a partner at Deloitte AG, assures the Court that
his firm is a "disinterested person" as the term is defined under
Section 101(14) of the Bankruptcy Code.
About Chemtura Corp.
Based in Middlebury, Connecticut, Chemtura Corporation (CEM) --
http://www.chemtura.com/-- with 2008 sales of $3.5 billion, is a
global manufacturer and marketer of specialty chemicals, crop
protection products, and pool, spa and home care products.
Chemtura Corporation and 26 of its U.S. affiliates filed voluntary
petitions for relief under Chapter 11 on March 18, 2009 (Bankr.
S.D.N.Y. Case No. 09-11233). M. Natasha Labovitz, Esq., at
Kirkland & Ellis LLP, in New York, serves as bankruptcy counsel.
Wolfblock LLP serves as the Debtors' special counsel. The
Debtors' auditors and accountant are KPMG LLP; their investment
bankers are Lazard Freres & Co.; their strategic communications
advisors are Joele Frank, Wilkinson Brimmer Katcher; their
business advisors are Alvarez & Marsal LLC and Ray Dombrowski
serves as their chief restructuring officer; and their claims and
noticing agent is Kurtzman Carson Consultants LLC.
As of December 31, 2008, the Debtors had total assets of
$3.06 billion and total debts of $1.02 billion.
Bankruptcy Creditors' Service, Inc., publishes Chemtura
Bankruptcy News. The newsletter tracks the Chapter 11
proceedings undertaken by Chemtura Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
CHEMTURA CORP: Proposes De Pardieu as French Counsel
----------------------------------------------------
The Debtors sought and obtained authority from the Court to
employ De Pardieu Brocas Maffei A.A.R.P.I., as their French
counsel, nunc pro tunc to April 23, 2009, to advise them with
respect to their non-Debtor European subsidiaries.
De Pardieu is an international full-service law firm with more
than 100 attorneys. It has extensive experience in cross-border
insolvencies, including those of Eurotunnel, Global Automotive
Logistics and Belvedere, the Debtors note.
As the Debtor's French counsel, De Pardieu will:
(a) advise the Debtors with respect to the powers and duties
of their non-Debtor French subsidiaries;
(b) advise and consult on the impact of the Debtors' Chapter
11 proceedings on their French subsidiaries;
(c) take all necessary action to protect and preserve the
Debtors' interest in their French subsidiaries and the
value of those interests;
(d) advise the Debtors with respect to the implementation or
impacts of any asset dispositions relating to the non-
Debtor French subsidiaries; and
(e) consult with the Debtors in relation to any accounting,
tax or other regulatory requirements regarding the non-
Debtor French subsidiaries.
The Debtors will pay De Pardieu's services on an hourly basis and
will reimburse the firm of its actual and necessary out-of-pocket
expenses. De Pardieu's hourly rates are:
Partners EU510
Senior Associates EU330
Junior Associates EU185
Trainees/Paralegals EU100
Jacques Henrot, Esq., a partner at De Pardieu, assures the Court
that his firm is a "disinterested person" as the term is defined
in Section 101(14) of the Bankruptcy Code.
About Chemtura Corp.
Based in Middlebury, Connecticut, Chemtura Corporation (CEM) --
http://www.chemtura.com/-- with 2008 sales of $3.5 billion, is a
global manufacturer and marketer of specialty chemicals, crop
protection products, and pool, spa and home care products.
Chemtura Corporation and 26 of its U.S. affiliates filed voluntary
petitions for relief under Chapter 11 on March 18, 2009 (Bankr.
S.D.N.Y. Case No. 09-11233). M. Natasha Labovitz, Esq., at
Kirkland & Ellis LLP, in New York, serves as bankruptcy counsel.
Wolfblock LLP serves as the Debtors' special counsel. The
Debtors' auditors and accountant are KPMG LLP; their investment
bankers are Lazard Freres & Co.; their strategic communications
advisors are Joele Frank, Wilkinson Brimmer Katcher; their
business advisors are Alvarez & Marsal LLC and Ray Dombrowski
serves as their chief restructuring officer; and their claims and
noticing agent is Kurtzman Carson Consultants LLC.
As of December 31, 2008, the Debtors had total assets of
$3.06 billion and total debts of $1.02 billion.
Bankruptcy Creditors' Service, Inc., publishes Chemtura
Bankruptcy News. The newsletter tracks the Chapter 11
proceedings undertaken by Chemtura Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
CHEMTURA CORP: Seals Portions of Amended Schedules
--------------------------------------------------
Chemtura Corp. and its affiliates sought and obtained authority
from the Court to file under seal certain portions of their
amended and restated schedules of assets and liabilities.
Richard M. Cieri, Esq., at Kirkland & Ellis LLP, in New York,
notes that certain of the Debtors amended Schedules to reflect
changes, including modifications to payment of prepetition
claims.
Mr. Cieri relates that as was the case of the original Schedules,
the Debtors identified certain sensitive information that absent
specific relief, they would be required to make publicly known on
their individual Amended Schedules. For this reason, the Debtors
sought relief from the Court to file sensitive information
contained in the Amended Schedules under seal.
The Debtors have submitted to the Court copies of the Amended
Schedules of these entities:
Amended Amended
Debtor Assets Liabilities
------ -------------- ----------------
Chemtura Corporation $1,587,539,976 $3,507,999,335
Great Lakes Chemical Corp. $2,201,975,442 $1,184,050,403
Bio-Lab, Inc. $507,236,037 $782,727,028
GLCC Laurel LLC $49,299,348 $715,146,792
BioLab Company Store LLC $599,535 $691,307,361
BioLab Franchise Company LLC $100,683 $692,295,639
Full-text copies of the Debtors' Amended Schedules are available
for free at:
http://bankrupt.com/misc/ChmtAmSAL-CC.pdf
http://bankrupt.com/misc/ChmtAmSALGLk.pdf
http://bankrupt.com/misc/ChmtAmSALBLI.pdf
http://bankrupt.com/misc/ChmtAmSALGLCC.pdf
http://bankrupt.com/misc/ChmtAmSALBioL.pdf
http://bankrupt.com/misc/ChmtAmSALBioLFran.pdf
About Chemtura Corp.
Based in Middlebury, Connecticut, Chemtura Corporation (CEM) --
http://www.chemtura.com/-- with 2008 sales of $3.5 billion, is a
global manufacturer and marketer of specialty chemicals, crop
protection products, and pool, spa and home care products.
Chemtura Corporation and 26 of its U.S. affiliates filed voluntary
petitions for relief under Chapter 11 on March 18, 2009 (Bankr.
S.D.N.Y. Case No. 09-11233). M. Natasha Labovitz, Esq., at
Kirkland & Ellis LLP, in New York, serves as bankruptcy counsel.
Wolfblock LLP serves as the Debtors' special counsel. The
Debtors' auditors and accountant are KPMG LLP; their investment
bankers are Lazard Freres & Co.; their strategic communications
advisors are Joele Frank, Wilkinson Brimmer Katcher; their
business advisors are Alvarez & Marsal LLC and Ray Dombrowski
serves as their chief restructuring officer; and their claims and
noticing agent is Kurtzman Carson Consultants LLC.
As of December 31, 2008, the Debtors had total assets of
$3.06 billion and total debts of $1.02 billion.
Bankruptcy Creditors' Service, Inc., publishes Chemtura
Bankruptcy News. The newsletter tracks the Chapter 11
proceedings undertaken by Chemtura Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
CHIYODA AMERICA: Disclosure Statement Hearing Set for October 5
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
set Oct. 5, 2009, at 10:00 a.m., to consider approval of the
disclosure statement explaining a Chapter 11 plan of
reorganization filed by Chiyoda America Inc. Objections, if any,
are due Sept. 30, 2009, at 4:00 p.m.
The Debtor has filed a plan to pay unsecured creditors in full
over time so the parent may retain ownership. The plan calls for
the parent's secured claim to be reduced to $3 million, with the
deficiency of $14.2 million becoming an unsecured claim. Third-
party unsecured creditors are slated to be paid in full over four
years, if they vote for the plan.
The Debtor will seek confirmation of the Plan at hearings
scheduled to begin Nov. 10, 2009.
Based in New York, Chiyoda America Inc. fka Cosmopolitan Graphics
Corporation filed for Chapter 11 protection on Aug. 19, 2009
(Bankr. S.D.N.Y. Case No. 09-15059). Michael Z. Brownstein, Esq.
Blank Rome LLP, represents the Debtor in its restructuring
efforts. In its petition, the Debtor listed both assets and debts
between $10 million and $50 million.
CHIYODA AMERICA: Selects Blank Rome as Counsel
----------------------------------------------
Chiyoda America Inc. asks the U.S. Bankruptcy Court for the
Southern District of New York for permission to employ Blank Rome
LLP as its counsel.
The firm has agreed to:
a) advise the Debtor's management concerning its fiduciary
obligations to the Debtor's estate, the Debtor's creditors
and the Bankruptcy Court;
b) assist the Debtor regarding the administration and
prosecution of its chapter 11 case, including taking all
necessary actions to protect and preserve the Debtor's
estate, which actions include, without limitation,
prosecution of adversary proceedings, defense of actions
commenced against the Debtor, commencement and prosecution
of objections to claims and assisting the Debtor in the
claims reconciliation process;
c) prepare all motions, applications, orders and other
pleadings to be filed with the Bankruptcy Court, and
counseling the Debtor regarding the preparation of
schedules, statements and operating reports in connection
with the administration of the Debtor's estates;
d) represent the Debtor at all hearings held before the
Bankruptcy Court concerning its chapter 11 cases and at
statutory creditors' meetings conducted by the Office of the
United States Trustee;
e) assist the Debtor in the formulation and negotiation of a
chapter 11 plan of reorganization or liquidation and related
disclosure statement and confirmation of such plan, and
representing the Debtor during the confirmation process; and
f) render to the Debtor other legal services as may be
requested by management of the Debtor and as may be required
in furtherance of its chapter 11 case.
The firm's standard hourly rates are:
Partners $425-$785
Associate and Counsel $245-$485
Paraprofessional $105-$280
The Debtor assures the Court that the firm is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.
Based in New York, Chiyoda America Inc. fka Cosmopolitan Graphics
Corporation filed for Chapter 11 protection on Aug. 19, 2009
(Bankr. S.D.N.Y. Case No. 09-15059). Michael Z. Brownstein, Esq.
Blank Rome LLP, represents the Debtor in its restructuring
efforts. In its petition, the Debtor listed both assets and debts
between $10 million and $50 million.
CHRYSLER LLC: Retiree Trust Should Repay Creditors, Indiana Says
----------------------------------------------------------------
Linda Sandler at Bloomberg News reports that Indiana Solicitor
General Thomas Fisher filed with the Supreme Court on September 3
a petition seeking to reconsider an earlier appeal made by the
Indiana pension funds in connection with the sale of Chrysler
LLC's assets to an entity owned by Fiat S.p.A. and the U.S.
government.
Indiana Attorney General Gregory Zoeller reiterated earlier
contentions that the deal violated bankruptcy rule as it benefited
lower ranked creditors over secured creditors such as the Indiana
funds. The retirees' health-care trust, owed $10.6 billion, was a
junior creditor but it received a $4.6 billion note and stock in
the new entity. Major secured creditors agreed to take about
$2 billion for their original $6.9 billion in claims.
"On its face, this deal smacks of the sort of insider favoritism
that the Bankruptcy Code was designed to prevent," the filing
said, according to the Bloomberg report. The funds aren't seeking
to undo the transaction this time, only to change it "to the
extent that the distribution of proceeds was inequitable," it
said.
The U.S. Supreme Court in June rejected an appeal by consumer
groups and three Indiana pension plans to block Chrysler LLC's
sale to Fiat SpA. The U.S. Court of Appeals for the Second
Circuit had affirmed the decision of the U.S. Bankruptcy Court for
the Southern District of New York approving the sale, which was
done on a fast-tracked basis to stem further losses by the
automaker.
The Indiana Pensioners at that time questioned the government's
use of funds from a federal bailout to help Chrysler when the
funds were allocated to help only struggling financial
institutions. It also questioned the move of the automaker to put
the rights of junior creditors ahead of the rights of the senior
lenders. The Indiana Pensioners held $42.5 million of
$6.9 billion in Chrysler secured loans.
About Chrysler LLC
Chrysler Group LLC, formed in 2009 from a global strategic
alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge,
Mopar(R) and Global Electric Motors (GEM) brand vehicles and
products. With the resources, technology and worldwide
distribution network required to compete on a global scale, the
alliance builds on Chrysler's culture of innovation -- first
established by Walter P. Chrysler in 1925 -- and Fiat's
complementary technology -- from a company whose heritage dates
back to 1899.
Headquartered in Auburn Hills, Michigan, Chrysler Group LLC's
product lineup features some of the world's most recognizable
vehicles, including the Chrysler 300, Jeep Wrangler and Dodge Ram.
Fiat will contribute world-class technology, platforms and
powertrains for small- and medium-sized cars, allowing Chrysler
Group to offer an expanded product line including environmentally
friendly vehicles.
Chrysler LLC and 24 affiliates on April 30 sought Chapter 11
protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead Case
No. 09-50002). Chrysler 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 has
changed its corporate name to Old CarCo following its sale to a
Fiat-owned company. As of December 31, 2008, Chrysler had
$39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler
had $1.9 billion in cash at that time.
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. Under the
terms approved by the Bankruptcy Court, the company formerly known
as Chrysler LLC on June 10, 2009, formally sold substantially all
of its assets, without certain debts and liabilities, to a new
company that will operate as Chrysler Group LLC. Fiat has a 20
percent equity interest in Chrysler Group.
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)
CIT GROUP: Analysts Believe Bankruptcy Can Still be Avoided
-----------------------------------------------------------
TheStreet reports that analysts believe that CIT Group can still
avoid a bankruptcy filing.
According to TheStreet, credit analysts remain unfazed by the
deferral of interest payments on bonds due in 2067. TheStreet
quoted independent research firm Gimme Credit debt analyst
Kathleen Shanley as saying, "We don't view the suspension of
payments as a surprise." The report says that CIT's failure to
make timely interest payments on the bonds doesn't trigger a
default under the terms of the obligations. The report states
that Standard & Poor's Ratings Service confirmed that its rating
was unaffected by the payment deferral.
Citing legal experts, Elinor Comlay and Caroline Humer at Reuters
relate that due to market dominance and tight contracts, CIT has
been able to keep much of its $42 billion "factoring" business
intact. CIT's retail clients tried to leave the Company but many
found that they didn't have anywhere else to go, says Reuters.
CIT spokesperson Curt Ritter said that the Company's factoring
volume for the first six months of 2009 was $16.5 billion,
compared to $20.7 billion in 2008, according to Reuters. Citing
Mr. Ritter, Reuters relates that CIT continues to sign new
factoring business and is committed to its clients.
Restructuring Plan
CIT in early August announced a restructuring of its liabilities
to provide additional liquidity and further strengthen its capital
position. CIT said in a Form 10-Q filing with the Securities and
Exchange Commission that it intends to pursue its restructuring
plan outside of the Bankruptcy Court.
The Company's restructuring plan includes various scenarios, some
of which reflect possible asset or business sales. As part of its
restructuring plan, the Company obtained a $3 billion loan and
commenced a cash tender offer for its $1 billion outstanding
floating-rate senior notes due August 17, 2009. CIT said that the
tender offer met minimum requirements as 59.81% of the total notes
outstanding were tendered. CIT offered $875 per $1,000 principal
amount of the notes.
The Company admitted it may need to seek relief under the U.S.
Bankruptcy Code if its restructuring plan is unsuccessful, or if
the steering committee of bondholders is unwilling to agree to an
out-of-court restructuring. This relief may include (i) seeking
bankruptcy court approval for the sale of most or substantially
all of our assets pursuant to Section 363(b) of the Bankruptcy
Code; (ii) pursuing a plan of reorganization; or (iii) seeking
another form of bankruptcy relief, all of which involve
uncertainties, potential delays and litigation risks.
About CIT Group
CIT Group Inc. -- http://www.cit.com/-- is a bank holding company
with more than $60 billion in finance and leasing assets that
provides financial products and advisory services to small and
middle market businesses. Operating in more than 50 countries
across 30 industries, CIT provides an unparalleled combination of
relationship, intellectual and financial capital to its customers
worldwide. CIT maintains leadership positions in small business
and middle market lending, retail finance, aerospace, equipment
and rail leasing, and vendor finance. Founded in 1908 and
headquartered in New York City, CIT is a member of the Fortune
500.
As of June 30, 2009, CIT Group had total assets of $71,019,200,000
against total debts of $64,901,200,000.
As reported by the TCR on August 19, 2009, Fitch Ratings has
downgraded CIT Group Inc.'s Issuer Default Rating to Restricted
Default (RD) from 'C' following completion of the company's bond
tender offer, which covered the purchase of 59.81% of the
company's $1 billion floating rate senior secured notes.
For the same reason, Standard & Poor's Ratings Services lowered
its long-term counterparty credit rating on CIT Group Inc. to 'SD'
(selective default) from 'CC'.
CITY CAPITAL: Has Yet to File 1st and 2nd Quarter 2009 Reports
--------------------------------------------------------------
City Capital Corporation has yet to file its quarterly report on
Form 10-Q for period ended June 30, 2009. The Company informed
the Securities and Exchange in an August 14 filing that it was in
the process of compiling and reviewing information for the June 30
Form 10-Q, which process has not yet been completed.
The Company also has not filed its quarterly report for the period
ended March 31, 2009.
In its report dated March 27, 2009 on the financial statements for
the years ended December 31, 2008 and 2007 -- Spector, Wong &
Davidian, LLP, in Pasadena, California -- the Company's
independent registered public accounting firm expressed
substantial doubt about the Company's ability to continue as a
going concern. The Company's ability to continue as a going
concern is an issue raised as a result of cash flow constraint, an
accumulated deficit of $12,152,194 as of December 31, 2008 and
recurring losses from operations. The Company continues to
experience net losses. The Company's ability to continue as a
going concern is subject to the ability to generate a profit or
obtain necessary funding from outside sources, including obtaining
additional funding from the sale of its securities, increasing
sales or obtaining loans from various financial institutions where
possible. The continued net losses and stockholders' deficit
increases the difficulty in meeting such goals and there can be no
assurances that such methods will prove successful.
As of December 31, 2008, the Company had total assets of
$2,531,761 and total liabilities of $4,839,438, resulting in
stockholders' deficit of $2,307,677.
Ephren W. Taylor II, Chief Executive Officer of City Capital,
disclosed in a September 1, 2009 filing with the SEC the services
agreements entered into by the Company in June 2008:
(a) On June 5, 2008, the Company entered into a consulting
services agreement with Web3Direct, Inc., a Florida
corporation. 100% of the outstanding shares of common
stock of WEB3Direct, Inc. is held by Sadiq Family Limited
Partnership, a Nevada partnership in which Waldo E.
Brantley III, the Company's Executive Vice President and
a director, owns a 5% interest and his wife, Anne Banas,
owns a 95% interest. However, Mr. Brantley is the
general partner of this partnership and controls the
voting power and the investment power over the assets of
this company.
Under the agreement, Web3Direct is providing to the
Company all necessary services required in connection
with providing marketing and business growth consulting
services. Under the terms of this agreement, which
covers services commenced on January 1, 2008, Web3Direct
is being paid a fixed monthly retainer of $10,000 for the
12 months ended December 31, 2008. Payment of the
retainer was in the form of restricted shares of the
Company's common stock (valued based on the closing price
of this common stock on June 5, 2008 of $0.20 per share).
The retainer is payable on the first of each calendar
month in advance (with the retainer for the period of
January 1, 2008 through June 30, 2008 due upon the
execution of this agreement).
See http://ResearchArchives.com/t/s?4459
(b) On June 5, 2008, the Company entered into an agreement
with REIAssure, Inc., a Florida corporation. Under the
agreement REIAssure agreed to provide sales services for
the Company, working with leads provided by the Company
and its affiliates, as well as other sources, to create
qualified clients which are able to purchase properties
provided by the Company. All services under this
agreement were concluded prior to December 31, 2008.
REIAssure is controlled by Mr. Brantley.
See http://ResearchArchives.com/t/s?445a
City Capital Corporation is a professional management and
diversified holding company engaged in leveraging investments,
holdings and other assets to build value for investors and
shareholders. The Company maintains stakes in industries such as
technology, biofuels, commercial laundry, and retail services.
The Company acquires and revitalizes distressed investment
opportunities in multiple industry segments, creating potentially
long-term returns for the Company.
CITY OF VALLEJO: Workers to Vote on CBA Rejection Appeal
--------------------------------------------------------
According to Vallejo Times-Herald, the city of Vallejo's laborer
and officer workers' union will vote this week as to whether to
appeal from the Bankruptcy Court's ruling rejecting their labor
contract. International Brotherhood of Electrical Workers Local
2376 Vice President Ken Shoemaker said union members are weighing
their options.
Times-Herald relates that IBEW attorney Dean Gloster stated it can
be argued that state law does not allow for the rejection of
public employee contracts, adding that most IBEW employees' costs
are paid through restricted city funds that are not considered
bankrupt.
The IBEW is the only union that hasn't agreed to the modification
or rejection of its collective bargaining agreement with Vallejo.
According to Times-Herald, an option for the union is to engage in
negotiations with the city. It notes that even if the IBEW can
win on appeal, any contract will expire in a matter of months
anyway and a victory would be more symbolic than anything.
Vallejo -- http://www.ci.vallejo.ca.us/GovSite-- is a city in
Solano County, in California. As of the 2000 census, the city had
a total population of 116,760. It is located in the San Francisco
Bay Area on the northern shore of San Pablo Bay. The City is a
charter city organized and exercising governmental functions under
its charter and the laws and constitution of the state. Its
governing body is its City Council.
The City filed for protection under Chapter 9 of the U.S.
Bankruptcy Code on May 23, 2008 (Bankr. E.D. Calif. Case No.
08-26813). Marc A. Levinson, Esq., and Norman C. Hile, Esq., at
Orrick, Herrington & Sutcliffe LLP in Sacramento, California,
represent the City.
COMMERCECONNECT MEDIA: Wins Confirmation of Reorganization Plan
---------------------------------------------------------------
CommerceConnect Media Holdings Inc. won confirmation by the
Bankruptcy Court of its prepackaged Chapter 11 plan at a
September 8 hearing, Michael Bathon at Bloomberg News reported.
"It gives the company a new lease on life," Cygnus Chief Executive
Officer Charles Carnaval said in an interview with Bloomberg.
Confirmation of the plan "allows the company to grow, unencumbered
with debt," he said.
As reported by the Troubled Company Reporter on August 5, 2009,
CommerceConnect filed together with its bankruptcy petition, a
plan of reorganization negotiated with lenders prepetition. The
proposed Chapter 11 plan provides for the conversion of a large
portion of its existing first lien debt and all of the existing
second lien debt to equity.
According to the disclosure statement explaining the Plan:
-- Holders of first lien facility claims owed not less than
$173,000,000 will recover not more than 70% of their claims.
Holders of first lien debt will receive their pro rata share
of the $60 million of new term debt and new common stock.
-- Holders of second lien facility claims owed $32,000,000 to
$35,000,000 will recover not more than 4% of their claims.
They will receive warrants to purchase 7,600 shares of Class
A common stock at a price of $450 per share, based on an
assumed total enterprise value of $105 million.
-- The rights of holders of allowed general unsecured claims
will be reinstated. They will recover 100% of their claims
in the ordinary course. These claimants are unimpaired under
the Plan and are deemed to have accepted the Plan.
-- All existing stock will be cancelled, and holders of these
interests won't recover anything.
That plan is supported by all of the holders of the second lien
debt and all but one of the holders of the first lien debt. The
dissenting first lien lender is Genesis CLO 2007-2, Ltd., managed
by Levine Leichtman, and owed $6.4 million of the $173 million in
first lien obligations. The agreements governing the first lien
debt required unanimous consent for an out-of-court restructuring
forcing the Debtors to file for bankruptcy to implement its plan.
With the majority of the impaired voting creditors that have
accepted the Plan, the Debtors will ask the Court on September 8
to confirm the Plan. Pursuant to Section 1126 of the Bankruptcy
Code, an impaired class of claims has accepted the Plan if the
holders of at least two-thirds in dollar amount and more than one-
half in number of the allowed claims in the call actually voting
to have voted to accept the Plan.
Holders of existing stock are deemed to reject the Plan owing to
their zero recovery.
Copies of the Plan and Disclosure Statement are available for free
at:
http://bankrupt.com/misc/CC_Prepack_DS.pdf
http://bankrupt.com/misc/CC_Prepack_Plan.pdf
About CommerceConnect
CommerceConnect Media, doing business as Cygnus, is a business-to-
business publisher and communications company. CommerceConnect's
brands include Qualified Remodeler, Firehouse, Equipment Today,
Kitchen and Bath Design News, and the CPA Technology Advisor. In
total, CommerceConnect publishes 42 trade publications in 13
markets, with total circulation of more than 3 million.
CommerceConnect also operates 38 Web sites which generated more
than 180 million page views in 2008. CommerceConnect also
produces more than 30 trade shows and events each year.
CommerceConnect Media Holdings, Inc., together with affiliates,
including Cygnus Business Media Inc., filed for Chapter 11 on
August 3, 2009 (Bankr. D. Del. Case No. 09-12765). Attorneys at
Richards, Layton & Finger, P.A., and Curtis, Mallet-Prevost, Colt
& Mosle LLP, serve as counsel to the Debtors. Garden City Group
Inc. serves as noticing and claims agent. Miller Buckfire & Co.,
LLC, is the Debtors' financial advisor. Attorneys at Sidley
Austin represent General Electric Capital Corp., the first lien
agent, while attorneys at Paul, Hastings, Janofsky & Walker LLP
serve as counsel to Barclays Bank PLC, the second lien agent.
Judge Brendan Linehan Shannon presides over the case. The
petition says CommerceConnect has $100,000,001 to $500,000,000 in
assets and debts.
COOPER-STANDARD: Canada Court Issues First Amended Initial Order
----------------------------------------------------------------
Honorable Justice Sidney Lederman of the Ontario Superior Court
of Justice issued on September 1, 2009, an amended initial order
in the insolvency proceeding of Cooper-Standard Automotive Canada
Ltd.
Mr. Justice Lederman amended the order initially issued on August
4, 2009, upon request of Deutsche Bank Trust Company Americas,
the administrative agent under a debtor-in-possession credit
agreement, to "clarify the operation of certain rights" under the
agreement, and in light of the endorsement he made which provided
for additional obligations on CSA Canada.
The amended initial order prohibits CSA Canada to make payments
out of the ordinary course or to any of its affiliates other than
for trade purposes without further order of the Canadian court.
It also prohibits CSA Canada to make payments of amounts it owes
to creditors as of September 1, 2009; to grant security interest,
trust, liens, charges or encumbrances in its properties; and to
grant credit or incur liabilities except in the ordinary course
of business until further court order, with the consent of its
monitor and Deutsche Bank or otherwise in connection with the
exercise of the rights and remedies by Deutsche Bank and the
lenders under the credit agreement.
The amended initial order also authorizes Deutsche Bank to
exercise its rights on behalf of the lenders against CSA Canada
and its properties, including directing other creditors to
exercise their rights against the company and its properties on
the instruction of Deutsche Bank.
A full-text copy of the amended initial order is available for
free at http://bankrupt.com/misc/CooperAmendedInitialOrder.pdf
About Cooper-Standard
Cooper-Standard Automotive Inc., headquartered in Novi, Mich., is
a leading global automotive supplier specializing in the
manufacture and marketing of systems and components for the
automotive industry. Products include body sealing systems, fluid
handling systems and NVH control systems. The Company is one of
the leading suppliers of chassis products in North America, with
about 14% of market share. The Company's main customers include
Ford Motor Company, General Motors, Chrysler, Audi, Volkswagen,
BMW, Fiat and Honda, among other automakers.
Cooper-Standard Automotive -- http://www.cooperstandard.com/
-- employs approximately 16,000 people globally with more than 70
facilities throughout the world. Cooper-Standard is a privately-
held portfolio company of The Cypress Group and Goldman Sachs
Capital Partners Funds.
Cooper-Standard Holdings Inc., together with affiliates, filed for
Chapter 11 on August 4, 2009 (Bankr. D. Del. Case No. 09-12743).
Attorneys at Fried, Frank, Harris, Shriver & Jacobson LLP and
Richards, Layton & Finger, P.A., will serve as bankruptcy counsel
to the Debtors. Lazard Freres & Co. is serving as investment
banker while Alvarez & Marsal is financial advisor. Kurtzman
Carson Consultants LLC is notice, claims and solicitation agent.
In its bankruptcy petition, the Company said that assets on a
consolidated basis total $1,733,017,000 while debts total
$1,785,039,000 as of March 31, 2009.
The Company's Canadian subsidiary, Cooper-Standard Automotive
Canada Limited, also sought relief under the Companies' Creditors
Arrangement Act in the Ontario Superior Court of Justice in
Toronto, Ontario, Canada.
Bankruptcy Creditors' Service, Inc., publishes Cooper-Standard
Bankruptcy News. The newsletter tracks the Chapter 11 and CCAA
proceedings undertaken by Cooper-Standard Holdings Inc. and its
various affiliates. (http://bankrupt.com/newsstand/or 215/945-
7000)
COOPER-STANDARD: CSA Canada Gets November 3 Extension of CCAA Stay
------------------------------------------------------------------
Cooper-Standard Automotive Canada Ltd. sought and obtained a
three-month extension of the order issued by Ontario Superior
Court of Justice granting them protection from creditors under
the Companies' Creditors Arrangement Act.
The extension gives CSA Canada until November 3, 2009, to
formulate and negotiate a plan of arrangement or compromise in
coordination with Cooper-Standard Holdings Inc. and other U.S.-
based affiliates, which are also under restructuring.
"[CSA Canada] expects that it will not be possible to implement
such coordinated restructuring until at least December 2009," Jay
Swartz, Esq., at Davies Ward Phillips & Vineberg LLP, in Toronto,
Ontario, said in court papers.
RSM Richter Inc., the court-appointed monitor of CSA Canada,
expressed support for the extension of the CCAA Stay.
"The company is acting in good faith and with due diligence in
its restructuring efforts. An extension will provide the company
the opportunity to participate in Cooper Group's restructuring
efforts," RSM Richter said in its monitor report.
CSA Canada sought creditor protection under the CCAA on August 4,
2009, a day after its U.S. affiliates filed chapter 11 petitions
in the U.S. Bankruptcy Court for the District of Delaware. Upon
its bankruptcy filing, CSA Canada obtained an order from the
Ontario Superior Court of Justice, preventing creditors from
taking legal actions against the company and its properties.
About Cooper-Standard
Cooper-Standard Automotive Inc., headquartered in Novi, Mich., is
a leading global automotive supplier specializing in the
manufacture and marketing of systems and components for the
automotive industry. Products include body sealing systems, fluid
handling systems and NVH control systems. The Company is one of
the leading suppliers of chassis products in North America, with
about 14% of market share. The Company's main customers include
Ford Motor Company, General Motors, Chrysler, Audi, Volkswagen,
BMW, Fiat and Honda, among other automakers.
Cooper-Standard Automotive -- http://www.cooperstandard.com/
-- employs approximately 16,000 people globally with more than 70
facilities throughout the world. Cooper-Standard is a privately-
held portfolio company of The Cypress Group and Goldman Sachs
Capital Partners Funds.
Cooper-Standard Holdings Inc., together with affiliates, filed for
Chapter 11 on August 4, 2009 (Bankr. D. Del. Case No. 09-12743).
Attorneys at Fried, Frank, Harris, Shriver & Jacobson LLP and
Richards, Layton & Finger, P.A., will serve as bankruptcy counsel
to the Debtors. Lazard Freres & Co. is serving as investment
banker while Alvarez & Marsal is financial advisor. Kurtzman
Carson Consultants LLC is notice, claims and solicitation agent.
In its bankruptcy petition, the Company said that assets on a
consolidated basis total $1,733,017,000 while debts total
$1,785,039,000 as of March 31, 2009.
The Company's Canadian subsidiary, Cooper-Standard Automotive
Canada Limited, also sought relief under the Companies' Creditors
Arrangement Act in the Ontario Superior Court of Justice in
Toronto, Ontario, Canada.
Bankruptcy Creditors' Service, Inc., publishes Cooper-Standard
Bankruptcy News. The newsletter tracks the Chapter 11 and CCAA
proceedings undertaken by Cooper-Standard Holdings Inc. and its
various affiliates. (http://bankrupt.com/newsstand/or 215/945-
7000)
COOPER-STANDARD: CSA Canada to Draw $35MM From DIP Facility
-----------------------------------------------------------
Cooper-Standard Automotive Canada Ltd. sought and obtained
approval from the Ontario Superior Court of Justice to draw down
an additional US$35 million under a debtor-in-possession credit
agreement.
CSA Canada previously obtained approval to use US$15 million to
finance its working capital requirements and other general
corporate purposes during the course of its restructuring. Under
the DIP credit agreement, the company can avail up to
US$50 million or more if permitted by the Canadian court.
CSA Canada Chief Financial Officer Allen Campbell said that the
additional fund is a "critical component of the overall liquidity
strategy for Cooper-Standard's global enterprise."
Mr. Campbell pointed out that CSA Canada can make inter-company
loans to other Cooper-Standard units to preserve the value of
[their] global enterprise upon which CSA Canada's value, in turn,
depends.
According to Mr. Campbell, CSA Canada also needs the additional
fund to ensure that it can pay the upcoming US$25 million in tax
liability associated with the receipt of the anticipated
provincial tax refund. He further said that the DIP credit
agreement also set a date for final borrowing, which requires CSA
Canada to avail of the fund by that date or the fund cannot be
borrowed at all.
This "use it or lose it proviso" requires that the funds be
borrowed now in order to ensure future liquidity, Mr. Campbell
said.
RSM Richter Inc., the court-appointed monitor of CSA Canada,
supported CSA Canada's additional borrowing, saying that
liquidity may be required in the immediate future to support the
global operations of Cooper-Standard units and that the
additional borrowing would ensure that funds will be available.
About Cooper-Standard
Cooper-Standard Automotive Inc., headquartered in Novi, Mich., is
a leading global automotive supplier specializing in the
manufacture and marketing of systems and components for the
automotive industry. Products include body sealing systems, fluid
handling systems and NVH control systems. The Company is one of
the leading suppliers of chassis products in North America, with
about 14% of market share. The Company's main customers include
Ford Motor Company, General Motors, Chrysler, Audi, Volkswagen,
BMW, Fiat and Honda, among other automakers.
Cooper-Standard Automotive -- http://www.cooperstandard.com/
-- employs approximately 16,000 people globally with more than 70
facilities throughout the world. Cooper-Standard is a privately-
held portfolio company of The Cypress Group and Goldman Sachs
Capital Partners Funds.
Cooper-Standard Holdings Inc., together with affiliates, filed for
Chapter 11 on August 4, 2009 (Bankr. D. Del. Case No. 09-12743).
Attorneys at Fried, Frank, Harris, Shriver & Jacobson LLP and
Richards, Layton & Finger, P.A., will serve as bankruptcy counsel
to the Debtors. Lazard Freres & Co. is serving as investment
banker while Alvarez & Marsal is financial advisor. Kurtzman
Carson Consultants LLC is notice, claims and solicitation agent.
In its bankruptcy petition, the Company said that assets on a
consolidated basis total $1,733,017,000 while debts total
$1,785,039,000 as of March 31, 2009.
The Company's Canadian subsidiary, Cooper-Standard Automotive
Canada Limited, also sought relief under the Companies' Creditors
Arrangement Act in the Ontario Superior Court of Justice in
Toronto, Ontario, Canada.
Bankruptcy Creditors' Service, Inc., publishes Cooper-Standard
Bankruptcy News. The newsletter tracks the Chapter 11 and CCAA
proceedings undertaken by Cooper-Standard Holdings Inc. and its
various affiliates. (http://bankrupt.com/newsstand/or 215/945-
7000)
COOPER-STANDARD: Proposes Foley & Lardner as Special Counsel
------------------------------------------------------------
Cooper-Standard Holdings Inc. and its affiliated debtors seek
approval of the U.S. Bankruptcy Court for the District of
Delaware to employ Foley & Lardner LLP as their special counsel
effective August 3, 2009.
The Debtors seek to employ Foley as special counsel in
coordination with their general bankruptcy counsel, Fried Frank
Harris Shriver & Jacobson LLP because of the firm's extensive
experience in automotive industry restructurings, according to
Chun Jang, Esq., at Richards Layton & Finger P.A., in Wilmington,
Delaware.
"Foley also has significant knowledge of the Debtors' operations
and legal issues, having represented the Debtors in numerous
legal matters over the last several years in nearly all aspects
of their businesses," Mr. Jang further says.
As the Debtors' special counsel, Foley is tasked to handle
automotive-related issues including supplier or customer-related
issues, and other matters with respect to which the firm has
previously been involved.
Foley will be paid for its services based on the firm's hourly
rates and will also be reimbursed of its expenses. The
professionals at the firm who are expected to provide legal
assistance to the Debtors and their hourly rates are:
Professionals Title Hourly Rate
------------- ----- -----------
Judy O'Neill Partner $675
Steven Hilfinger Partner $625
Ann Marie Uetz Partner $560
John Simon Senior Counsel $560
Ryan Bewersdorf Associate $465
Omar Lucia Associate $340
Adam Wienner Associate $345
Veronica Crabtree Paralegal $195
Ms. Uetz assures the Court that her firm does not hold or
represent any interest adverse to the Debtors or their estates,
and that the firm is a "disinterested person" as that term is
defined under Section 101(14) of the Bankruptcy Code.
About Cooper-Standard
Cooper-Standard Automotive Inc., headquartered in Novi, Mich., is
a leading global automotive supplier specializing in the
manufacture and marketing of systems and components for the
automotive industry. Products include body sealing systems, fluid
handling systems and NVH control systems. The Company is one of
the leading suppliers of chassis products in North America, with
about 14% of market share. The Company's main customers include
Ford Motor Company, General Motors, Chrysler, Audi, Volkswagen,
BMW, Fiat and Honda, among other automakers.
Cooper-Standard Automotive -- http://www.cooperstandard.com/
-- employs approximately 16,000 people globally with more than 70
facilities throughout the world. Cooper-Standard is a privately-
held portfolio company of The Cypress Group and Goldman Sachs
Capital Partners Funds.
Cooper-Standard Holdings Inc., together with affiliates, filed for
Chapter 11 on August 4, 2009 (Bankr. D. Del. Case No. 09-12743).
Attorneys at Fried, Frank, Harris, Shriver & Jacobson LLP and
Richards, Layton & Finger, P.A., will serve as bankruptcy counsel
to the Debtors. Lazard Freres & Co. is serving as investment
banker while Alvarez & Marsal is financial advisor. Kurtzman
Carson Consultants LLC is notice, claims and solicitation agent.
In its bankruptcy petition, the Company said that assets on a
consolidated basis total $1,733,017,000 while debts total
$1,785,039,000 as of March 31, 2009.
The Company's Canadian subsidiary, Cooper-Standard Automotive
Canada Limited, also sought relief under the Companies' Creditors
Arrangement Act in the Ontario Superior Court of Justice in
Toronto, Ontario, Canada.
Bankruptcy Creditors' Service, Inc., publishes Cooper-Standard
Bankruptcy News. The newsletter tracks the Chapter 11 and CCAA
proceedings undertaken by Cooper-Standard Holdings Inc. and its
various affiliates. (http://bankrupt.com/newsstand/or 215/945-
7000)
COOPER-STANDARD: Wants October 2 Extension for Schedules Filing
---------------------------------------------------------------
Cooper-Standard Holdings Inc. and its affiliated debtors ask the
U.S. Bankruptcy Court for the District of Delaware to give them
until October 2, 2009, to file their schedules of assets and
liabilities, schedules of current income and expenditures,
schedules of executory contracts and unexpired leases and
statements of financial affairs.
Pursuant to Rules 1007(b) and (c) of the Federal Rules of
Bankruptcy Procedure, a chapter 11 debtor must file within 15
days after its petition date, its Schedules and Statements.
Pursuant to Rule 1007-1(b) of the Local Rules of Bankruptcy
Practice and Procedure of the U.S. Bankruptcy Court for the
District of Delaware, the deadline for filing the Schedules and
Statements is automatically extended for an additional 15 days if
the debtor has more than 200 creditors and if the petition is
accompanied by a list of creditors.
Given the large number of potential creditors and the complex
nature of the Debtors' business affairs as well as the need to
continue to operate the Debtors' businesses while the necessary
information is being compiled, the Debtors do not believe that
they can complete the preparation of the schedules and statements
at this time, Chun Jang, Esq., at Richards Layton & Finger P.A.,
in Wilmington, Delaware, says in court papers.
The hearing to consider approval of the proposed extension is
scheduled for September 30, 2009. Creditors and other concerned
parties have until September 18, 2009, to file their objections.
Pursuant to Del.Bankr.LR 9006-2, the Debtors' Schedules Filing
Period is automatically extended until the conclusion of that
hearing.
About Cooper-Standard
Cooper-Standard Automotive Inc., headquartered in Novi, Mich., is
a leading global automotive supplier specializing in the
manufacture and marketing of systems and components for the
automotive industry. Products include body sealing systems, fluid
handling systems and NVH control systems. The Company is one of
the leading suppliers of chassis products in North America, with
about 14% of market share. The Company's main customers include
Ford Motor Company, General Motors, Chrysler, Audi, Volkswagen,
BMW, Fiat and Honda, among other automakers.
Cooper-Standard Automotive -- http://www.cooperstandard.com/
-- employs approximately 16,000 people globally with more than 70
facilities throughout the world. Cooper-Standard is a privately-
held portfolio company of The Cypress Group and Goldman Sachs
Capital Partners Funds.
Cooper-Standard Holdings Inc., together with affiliates, filed for
Chapter 11 on August 4, 2009 (Bankr. D. Del. Case No. 09-12743).
Attorneys at Fried, Frank, Harris, Shriver & Jacobson LLP and
Richards, Layton & Finger, P.A., will serve as bankruptcy counsel
to the Debtors. Lazard Freres & Co. is serving as investment
banker while Alvarez & Marsal is financial advisor. Kurtzman
Carson Consultants LLC is notice, claims and solicitation agent.
In its bankruptcy petition, the Company said that assets on a
consolidated basis total $1,733,017,000 while debts total
$1,785,039,000 as of March 31, 2009.
The Company's Canadian subsidiary, Cooper-Standard Automotive
Canada Limited, also sought relief under the Companies' Creditors
Arrangement Act in the Ontario Superior Court of Justice in
Toronto, Ontario, Canada.
Bankruptcy Creditors' Service, Inc., publishes Cooper-Standard
Bankruptcy News. The newsletter tracks the Chapter 11 and CCAA
proceedings undertaken by Cooper-Standard Holdings Inc. and its
various affiliates. (http://bankrupt.com/newsstand/or 215/945-
7000)
COSINE COMMUNICATIONS: Steel Partners et al., Disclose Stake
------------------------------------------------------------
As of the close of business on August 12, 2009, Steel Partners II
LP owned directly 2,148,337 shares of CoSine Communications, Inc.
common stock, par value $0.0001, constituting roughly 21.3% of the
Shares outstanding. By virtue of their relationships with Steel
Partners II, each of Steel Partners Holdings LP, Steel Partners
LLC, Steel Partners II GP LLC and Warren G. Lichtenstein may be
deemed to beneficially own the Shares owned directly by Steel
Partners II.
As of the close of business on August 12, 2009, Steel Holdings
owned directly 2,631,384 Shares, which, together with the Shares
owned directly by Steel Partners II that Steel Holdings may also
be deemed to beneficially own, constitute roughly 47.4% of the
Shares outstanding. By virtue of their relationships with Steel
Holdings, each of Partners LLC, Steel Partners GP and Warren G.
Lichtenstein may be deemed to beneficially own the Shares owned
directly by Steel Holdings, which, together with the Shares owned
directly by Steel Partners II that they may also be deemed to
beneficially own, constitute roughly 47.4% of the Shares
outstanding.
As of the close of business on August 12, 2009, Jack L. Howard
beneficially owned an aggregate of 255,425 Shares consisting of
(i) 76,625 Shares owned directly by Mr. Howard, (ii) 8,000 Shares
underlying options -- that are exercisable within 60 days of
August 13 -- owned directly by Mr. Howard, (iii) 500 Shares owned
by EMH Howard LLC, and (iv) 170,300 Shares owned by J Howard Inc.,
constituting in the aggregate roughly 2.5% of the outstanding
Shares.
As of the close of business on August 12, 2009, Terry R. Gibson
beneficially owned 100,000 Shares underlying options that are
exercisable within 60 days of August 13, constituting less than 1%
of the Shares outstanding.
CoSine Communications, Inc.'s current business strategy is to
enhance stockholder value by pursuing opportunities to redeploy
its assets through an acquisition of one or more operating
businesses with existing or prospective taxable earnings that can
be offset by use of its net operating loss carry-forwards. No
assurance can be given that CoSine will find suitable candidates,
and if it does, that it will be able to utilize its existing NOLs.
CoSine was a provider of carrier network equipment products and
services until the fourth quarter of fiscal year 2004 during which
time CoSine discontinued its product lines, took actions to lay
off most of its employees, terminated contract manufacturing
arrangements, contractor and consulting arrangements and various
facility leases, and sold, scrapped or wrote-off inventory,
property and equipment. In July 2005, CoSine's board of directors
approved its strategy of redeploying existing resources to
identify and acquire new business operations. In 2006, CoSine
sold the remaining assets of its carrier network products business
with the sale of its patent portfolio and the rights to the
related intellectual property. During 2006, CoSine also completed
the wrap-up of its carrier services business, providing customer
support services for its discontinued products through
December 31, 2006, at which time CoSine terminated all customer
support offerings. Effective July 1, 2007, CoSine engaged SP
Corporate Services LLC to provide all of its executive, financial
and administrative support service, rent and personnel
requirements and, as a result, CoSine no longer has any employees.
As reported by the Troubled Company Reporter on May 1, 2009,
CoSine said its restructuring activities and new redeployment of
assets strategy raise substantial doubt as to its ability to
continue as a going concern. Moreover, the report dated
February 17, 2009, of Burr, Pilger & Mayer LLP in Palo Alto,
California, the Company's independent registered public accounting
firm, on the Company's financial statements for the period ended
December 31, 2008, expressed doubt on the Company's ability to
continue as a going concern.
COYOTES HOCKEY: James Balsillie Ups Bid by $30 Million
------------------------------------------------------
The New York Times reports that James L. Balsillie has increased
his $212.5 million bid for Phoenix Coyotes by $30 million.
According to court documents, Mr. Balsillie's PSE Sports and
Entertainment revised its bid, offering to pay the city of
Glendale about $50 million to let Phoenix Coyotes get out of its
30-year lease at the city-owned Jobing.com Arena and move to
Hamilton, Ontario. PSE said in court documents that it "cannot
force Glendale to sell its Claims, of course, but is willing to
buy them for $50 million, which is substantially more than
Glendale would recover in the bankruptcy cases."
The NY Times states that Mr. Balsillie's $50 million payment to
Glendale would be in two parts -- $20 million to be subtracted
from his original bid for the Coyotes, and $30 million in new
money.
The NY Times relates that Mr. Balsillie's $242.5 million bid is
higher than Ice Edge Holdings' $150 million offer, and the
National Hockey League's $140 million bid.
Mr. Balsillie also agreed to extend his September 14 deadline for
a decision on bid for Phoenix Coyotes to at least September 21,
court documents say. Phoenix Business Journal relates that
Mr. Balsillie also offered to acquire the city of Glendale's
bankruptcy claims against the Phoenix Coyotes for $50 million, but
the deal comes with a reduction of the purchase price to
$193 million.
Dewey Ranch Hockey LLC, Arena Management Group, LLC, Coyotes
Holdings, LLC, and Coyotes Hockey, LLC -- owners and affiliates of
the Phoenix Coyotes National Hockey League team -- filed for
Chapter 11 protection (Bankr. D. Ariz. Case No. 09-09488) on
May 5, 2009. The Debtors are represented by Thomas J. Salerno,
Esq., at Squire, Sanders & Dempsey, LLP, in Phoenix, and estimate
their assets and liabilities are between $100 million and
$500 million.
Jim Balsillie, Research in Motion Ltd.'s co-chief executive
officer, offered to buy the Phoenix Coyotes for $212 million and
move the NHL team to Hamilton, Ontario, and the League balked at
the relocation proposal. Mr. Balsillie was unsuccessful in 2007
when he attempted to buy and relocate the Nashville Predators, and
lost a similar bid in 2006 to buy and relocate the Pittsburgh
Penguins.
CRUCIBLE MATERIALS: Two Serious Bidders Emerge
----------------------------------------------
According to AMM, at least two potential buyers have emerged as
serious bidders for the two halves of Crucible Materials Corp.
The report relates that private equity firm BlackEagle Partners
LLC is seeking to purchase Crucible's Syracuse specialty steel
mill and multiple service center locations, according to industry
sources, while Carpenter Technology Corp. previously emerged as a
party interested in purchasing Crucible's compaction metals
operation and its research and development division, both located
outside Pittsburgh.
Based in Syracuse, New York, Crucible Materials Corporation -- aka
Crucible Specialty Metals, Crucible Service Centers, Crucible
Compaction Metals, Crucible Research and Trent Tube -- makes
stainless and alloy steel for use in the aircraft, automotive,
petrochemical, and other industries. The Company is currently
employee-owned. Its Web site is http://www.crucible.com/
The Company and its affiliate, Crucible Development Corporation,
filed for Chapter 11 protection on May 6, 2009 (Bankr. D. Del.
Lead Case No. 09-11582). Mark Minuti, Esq., at Saul Ewing LLP
represents the Debtors in their restructuring efforts. The
Debtors engaged Duff & Phelps Securities LLP as investment banker;
RAS Management Advisors LLC as business advisor; and Epiq
Bankruptcy Solutions LLC as claims agent. Roberta A. DeAngelis,
United States Trustee for Region 3, appointed five creditors to
serve on the Official Committee of Unsecured Creditors. The
Debtors listed assets and debts both ranging from $100 million to
$500 million.
DAC TECHNOLOGIES: Has Going Concern Doubt, May Drop CIT as Factor
-----------------------------------------------------------------
DAC Technologies Group International, Inc., reported a net income
of $128,566 for three months ended June 30, 2009, compared with a
net income of $8,090 for the same period in 2008.
For six months ended June 30, 2009, the Company reported a net
income of $312,865 compared with a net income of $50,064 for the
same period in 2008.
The Company's balance sheet at June 30, 2009, showed total assets
of $7,492,988, total liabilities of $2,203,444 and stockholders'
equity of $5,289,544.
The Company said that there is substantial doubt about its ability
to continue as a going concern. The Company's liquidity needs
arise primarily from inventory, and its primary source of cash is
funds from operations. The Company maintains a factoring
agreement wherein it assigns its receivables on a non-recourse
basis. Consequently, if its sales revenues significantly decline,
it could affect its short-term liquidity. For the three-month
period ending June 30, 2009, its factor had advanced $1,416,559.
The Company added that its factor, The CIT Group, Inc., disclosed
there was no appreciable likelihood of immediate government aid
and it was evaluating alternatives. According to a report filed
by CIT on July 20, 2009, CIT's funding strategy and liquidity
position have been materially adversely affected by the ongoing
stress in the credit markets, credit ratings downgrades, and
regulatory and cash restrictions. As a result of these
developments, CIT has been forced to reduce its funding sources
almost exclusively to secured borrowings, where available. While
management of CIT continues to search for solutions to their
financial troubles, some type of bankruptcy remains a possibility.
The Company took the steps necessary to protect itself in the
event CIT files bankruptcy, or is otherwise unable to fulfill its
obligations to the Company. Since the end of the quarter ended
June 30, the Company has received additional advances from CIT
that virtually eliminate all risk of financial loss to the
Company. In addition, the Company has secured a six month,
$1,000,000 line of credit, collateralized by its inventory, with
its local bank. This credit line has been secured to meet the
Company's cash flow needs during any transition period in moving
from CIT to another factor. The Company currently has obtained
proposals from two other factors under terms and conditions more
favorable to the Company than its existing contract with CIT,
although there can be no assurance that these proposals will
eventually be closed. Additionally, the Company is currently
examining its legal options regarding termination of its existing
agreement with CIT and the consequences, if any, which a CIT
bankruptcy could have on the Company's outstanding loans.
A full-text copy of the Company's Form 10-Q is available for free
at http://ResearchArchives.com/t/s?4454
About DAC Technologies
DAC Technologies Group (OTC:DAAT) DAC Technologies Group
International, Inc., is engaged in the sale of gun maintenance,
hunting and camping accessories, household products and gun
safety. The Company's target consumer base is sportsmen, hunters
and outdoorsmen, and recreational enthusiasts. A significant
portion of its business is with the mass-market retailer Wal-Mart.
The majority of its products are manufactured and imported from
mainland China and shipped to a central location in Little Rock,
Arkansas for distribution. The Company's products can be grouped
into four categories: gun cleaning and maintenance, hunting and
camping, household, and gun safety. The Company designs and
engineers its products with the assistance of its Chinese trading
company and manufacturers, who are responsible for the tooling,
manufacture and packaging of the products.
DELPHI CORP: Gets Court Nod for Shinwa Int'l Settlement
-------------------------------------------------------
Delphi Corp. sought and obtained the Court's authority to enter
into a settlement agreement with Shinhwa International Holdings,
Ltd., formerly known as Shinwa Co., Ltd., and Samtech Corporation
in connection with a lawsuit pending in the United States
District Court for the Southern District of Indiana commenced by
Debtor Delphi Automotive Systems, LLP, against Shinwa
International.
John Wm. Butler, Jr., at Skadden, Arps, Slate, Meagher & Flom
LLP, in Chicago, Illinois, relates that the Debtors used
components supplied by Shinhwa International in equipment that
the Debtors sold to General Motors Corporation and other original
equipment manufacturers. GM received warranty claims from its
retail customers because certain CD players containing the
Shinhwa components were defective. The Debtors sought warranty
payments from Shinhwa International. Shinwa International,
however, refused to make payments on the warranty claims.
Accordingly, the Debtors filed the Lawsuit, asserting $15 million
in damages.
GM and the Debtors subsequently entered into a (i) Warranty
Settlement Agreement dated August 14, 2007, whereby GM agreed to
waive and release its warranty claims against the Debtors related
to the CD Players; and (ii) an Amended and Restated Global
Settlement Agreement, executed on September 12, 2008. As a
result of these settlements with GM and other developments, the
Debtors now have a much lower expectation of their likely
recovery in the Lawsuit, Mr. Butler notes.
Accordingly, the Debtors and Shinwa International entered into
the Settlement Agreement that provides these terms:
* The Debtors will reactivate, without delay, Shinwa
International on their global supplier list as an eligible
supplier for award of business by the Debtors;
* Shinwa International will pay the Debtors $300,000 without
delay in complete and final resolution of the Lawsuit; and
* The parties agree to mutual releases of claims against each
other arising from the Lawsuit.
Mr. Butler avers that the Settlement Agreement provides a
complete and final resolution to the Lawsuit. By entering into
the Settlement Agreement, the Debtors could avoid the inherent
risks of litigating the Lawsuit and any subsequent appeals.
Moreover, he adds, the Debtors could avoid the attendant costs
and expenses associated with protracted litigation.
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 confirmed Delphi's plan on January 25, 2008. The Plan
was not 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.
At the end of July 2009, Delphi obtained confirmation of a revised
plan, build upon a sale of the assets to a entity formed by some
of the lenders who provided $4 billion of debtor-in-possession
financing, and General Motors Company.
Bankruptcy Creditors' Service, Inc., publishes Delphi Bankruptcy
News. The newsletter tracks the Chapter 11 proceedings of Delphi
Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/
or 215/945-7000)
DRYSHIPS INC: COO Khanna to Present at Jefferies Shipping Confab
----------------------------------------------------------------
DryShips Inc. said Pankaj Khanna, Chief Operating Officer of the
Company, will be presenting at the Jefferies 6th Annual Shipping
and Offshore Services Conference on Wednesday, September 9, 2009,
at 12:30 pm EDT in New York City.
As reported by the Troubled Company Reporter on August 12, 2009,
DryShips reached an agreement with WestLB on waiver terms for
US$71 million of its outstanding debt. This agreement is subject
to customary documentation. George Economou, Chairman and Chief
Executive Officer, said, "We continue to have constructive
discussions with the remainder of our banks who are all very
supportive of the company."
About DryShips Inc.
DryShips Inc., -- http://www.dryships.com/-- based in Athens,
Greece, is an owner and operator of drybulk carriers that operate
worldwide. As DryShips owns a fleet of 41 drybulk carriers
comprising 7 Capesize, 29 Panamax, 2 Supramax and 3 newbuilding
drybulk vessels with a combined deadweight tonnage of over 3.6
million tons, 2 ultra deep water semisubmersible drilling rigs and
4 ultra deep water newbuilding drillships. DryShips Inc.'s common
stock is listed on the NASDAQ Global Market where trades under the
symbol "DRYS."
EASTWIND MARITIME: Trustee Wants to Let Go of Three Ships
---------------------------------------------------------
Rajesh Joshi at Lloydslist.com reports that the bankruptcy trustee
for Eastwind Maritime Inc. has decided to abandon three of the
Company's ships under arrest in three different ports around the
world.
Lloydslist.com relates that the trustee has forged a deal to sell
a fourth ship for $900,000.
The Hon. Alan Gropper of the US Bankruptcy Court in New York will
hold a hearing on Thursday to consider the proposals, says
Lloydslist.com.
Inspectors Get Pay & Return for Crews
Work by ITF inspectors and affiliated unions has been rewarded as
two more crews on ships formerly owned by Eastwind get their pay
and tickets home.
Eastwind owned around 63 vessels when it went under. Some of
these have been sold, some arrested. The ITF was called in by the
crews and, with the payments made to the crew of the Annapurna and
due in the next few days to that of the Azov Wind, has been
instrumental in resolving all of them.
ITF Maritime Coordinator Steve Cotton said, "Picking up the pieces
of the Eastwind collapse is a difficult but not impossible
situation. The ITF is one of the organizations -- including
agents, banks, port authorities, lawyers and unions -- looking for
a solution, and the contact between us and them has paid off in
the successes that each week are making a very bad state of
affairs a little bit better."
In Wellington, New Zealand, the crew of the Annapurna received
nine months owed pay and tickets home following intervention by
ITF inspector Graham MacLaren and the Maritime Union of New
Zealand. In Panama the crew of the Azov Wind are expecting a
similar payout after a sustained effort by Chilean inspector Juan
Villalon
The ITF has successfully assisted the crews of seven Eastwind
ships so far, and continues to work with all concerned to lessen
the impact of the bankruptcy on workers onboard the former
Eastwind's vessels.
About Eastwind Maritime
New York-based Eastwind Maritime Inc. operates a shipping company.
The Company and its affiliates filed for Chapter 11 bankruptcy
protection on June 24, 2009 (Bankr. S.D. N.Y. Case No. 09-14047).
Richard L. Epling, Esq., and Robyn J. Schneider, Esq., at
Pillsbury Winthrop Shaw Pittman LLP assist the Debtors in their
restructuring efforts. Eastwind Maritime listed $500 million to
$1 billion in assets and $500 million to $1 billion in
liabilities.
ENERGAS RESOURCES: Engages Smith Carney as Public Accountants
-------------------------------------------------------------
Energas Resources Inc., through and with the approval of its Board
of Directors, on August 12, 2009, engaged Smith, Carney & Co.,
p.c. as its independent registered public accounting firm.
Prior to engaging Smith Carney, the Company did not consult with
Smith Carney regarding the application of accounting principals to
a specific completed or contemplated transaction or regarding the
type of audit opinions that might be rendered by Smith Carney on
the Company's financial statements, and Smith Carney did not
provide any written or oral advice that was an important factor
considered by the Company in reaching a decision as to any such
accounting, auditing or financial reporting issue.
As reported by the Troubled Company Reporter, Energas Resources
said on July 15, 2009, Eide Bailly LLP resigned as the Company's
independent registered public accounting firm.
The report of Eide Bailly regarding the Company's financial
statements for the fiscal year ended January 31, 2009 did not
contain any adverse opinion or disclaimer of opinion and was not
qualified or modified as to uncertainty, audit scope or accounting
principles. However, the report of Eide Bailly for that fiscal
year was qualified with respect to uncertainty as to the Company's
ability to continue as a going concern.
During the year ended January 31, 2009, and during the period from
January 31, 2009, through July 15, 2009, the date of resignation,
there were no disagreements with Eide Bailly on any matter of
accounting principles or practices, financial statement disclosure
or auditing scope or procedures, which disagreements, if not
resolved to the satisfaction of Eide Bailly would have caused it
to make reference to such disagreement in its reports.
Based in Oklahoma City, Oklahoma, Energas Resources Inc. (OTC BB:
EGSR) -- http://www.energasresources.com/-- is primarily engaged
in the operation, development, production, exploration and
acquisition of petroleum and natural gas properties in the
United States through its wholly-owned subsidiary, A.T. Gas
Gathering Systems Inc. In addition, the company owns and operates
natural gas gathering systems located in Oklahoma, which serve
wells operated by the company for delivery to a mainline
transmission system. The majority of the company's operations are
maintained and occur through A.T. Gas.
Going Concern Doubt
Murrell, Hall, McIntosh & Co PLLP, in Oklahoma City, expressed
substantial doubt about Energas Resources' ability to continue as
a going concern after auditing the Company's consolidated
financial statements for the years ended January 31, 2008, and
2007. The auditing firm pointed to the Company's recurring losses
from operations.
ESCADA AG: Investors Present Offer; Plan Won't Need State Aid
-------------------------------------------------------------
According to Holger Elfes at Bloomberg News, the state of Bavaria
said Escada AG may get an investor who can retain its workers
without requiring the support of state aid. Nickolaus Becker, who
represents a group of potential investors, presented a rescue plan
September 8 to Horst Seehofer, Prime Minister of Bavaria, the
state said. Mr. Becker will speak to the company's insolvency
administrator September 9.
As reported by the Troubled Company Reporter on September 2, 2009,
ESCADA AG's preliminary insolvency administrator, Dr. Christian
Gerloff, has commissioned KPMG's Munich M&A divisions with the
task of preparing and accompanying negotiations with potential
investors for the women's fashion Group. The search for investors
is to start in due course and shall be swiftly completed, ESCADA
said in a September 1 statement.
Dr. Christian Gerloff said, "Both, the Board of Management of
ESCADA AG as well as myself, have received a series of interested
queries from potential investors. This interest indicates the
strength of the ESCADA brand. With the assistance of KPMG we will
now examine in a structured process, which of the investors has
the short-time capacity of securing the objective of the company's
going concern."
About ESCADA AG
The ESCADA Group -- http://www.escada.com/-- is an international
fashion group for women's apparel and accessories, which is active
on the international luxury goods market. It has pursued a course
of steady expansion since its founding in 1976 by Margaretha and
Wolfgang Ley and today has 182 own shops and 225 franchise
shops/corners in more than 60 countries.
As of August 10, 2009 the Escada Group operated 176 owned stores
and so-called shop in shops, of which 26 owned stores are located
in the United States and operated by Escada (USA) Inc. and 2
stores are planned to be opened in the United States before year
end. Escada Group products are also sold in 163 stores worldwide
which are operated by franchisees. Escada Group had total assets
of EUR322.2 million against total liabilities of 338.9 million as
of April 30, 2009.
ESCADA AG filed of an insolvency petition in Munich, Germany, on
August 13, 2009. The competent Municipal Court of Munich has
appointed Dr. jur. Christian Gerloff as preliminary insolvency
administrator.
Wholly owned subsidiary Escada (USA) Inc. filed for Chapter 11 on
August 14, 2009 (Bankr. S.D.N.Y. Case No. 09-15008). O'Melveny &
Myers LLP has been tapped as bankruptcy counsel. Kurtzman Carson
Consultants serves as claims and notice agent. Judge Stuart M.
Bernstein handles the case. Escada US listed US$50 million to
US$100 million in assets and US$100 million to US$500 million in
debts in its petition.
FAIRFAX FINANCIAL: AM Best Assigns "bb+" Rating to Preferred Stock
------------------------------------------------------------------
A.M. Best Co. has assigned indicative ratings of "bbb" to senior
unsecured debt, "bbb-" to subordinated debt and "bb+" to preferred
stock, which may be issued under Fairfax Financial Holdings
Limited's recently filed and approved shelf registration
statement. The outlook assigned to the ratings is stable.
This shelf registration replaces Fairfax's previous shelf
registration, which was withdrawn simultaneously with the
approval. The ratings for the previous shelf registration have
been withdrawn. Fairfax's issuer credit rating of "bbb" and
existing debt ratings remain unchanged, as do the financial
strength and issuer credit ratings of its insurance operating
subsidiaries.
Fairfax's unadjusted debt-to-total capital ratio is calculated at
26.8% following the recent issuance of CAD 400 million in senior
unsecured debt, an increase from 23.7% at June 30, 2009 (U.S.
GAAP). This calculation includes the debt of Odyssey Re Holdings
Corp., a majority-owned public company capable of servicing its
debt. The financial leverage and coverage ratios remain well
within A.M. Best's guidelines for its debt ratings and are
expected to remain so over the near term.
A.M. Best notes that cash, short-term investments and marketable
securities held at the holding company level totaled
$880.1 million at June 30, 2009, affording Fairfax additional
financial flexibility.
Fairfax Financial Holdings Limited -- http://www.fairfax.ca/--
is a financial services holding company which, through its
subsidiaries, is engaged in property and casualty insurance and
reinsurance and investment management.
FLEETWOOD ENTERPRISES: Izard Nobel Has Suit vs. Ex-Executives
-------------------------------------------------------------
The law firm of Izard Nobel LLP said a lawsuit seeking class
action status has been filed in the United States District Court
for the Central District of California on behalf of those who
purchased the common stock of Fleetwood Enterprises, Inc., between
December 6, 2007 and March 10, 2009, inclusive.
The Complaint charges certain of Fleetwood's former executives
violated federal securities laws. Fleetwood is not named in this
action as a defendant because it and its core operating
subsidiaries filed for bankruptcy protection in March 2009. The
complaint alleges that defendants failed to disclose the following
adverse facts: (i) that demand for Fleetwood's manufactured houses
and the big homes-on-wheels was rapidly declining, and was
adversely affecting the Company's liquidity; (ii) that the
Company's RV Group sales, especially in its travel trailer
division, were declining because of softening consumer demand due
to high gasoline prices and the credit crisis; (iii) that the
Company's financial condition was declining precipitously such
that the Company was nearing insolvency and would have to file for
bankruptcy protection; and (iv) based on the foregoing, defendants
had no reasonable basis for their positive statements regarding
the Company's ability to control its deteriorating financial
condition.
Members of the class may seek to be appointed as lead plaintiff no
later than November 2, 2009. A lead plaintiff is a class member
that acts on behalf of other class members in directing the
litigation. A class member's ability to share in any recovery is
not affected by the decision whether or not to seek appointment as
a lead plaintiff. However, lead plaintiffs make important
decisions which could affect the overall recovery for class
members.
While Izard Nobel LLP has not filed a lawsuit against the
defendants, to view a copy of the Complaint initiating the class
action or for more information about the case, and class members'
rights, visit http://www.izardnobel.com/fleetwood/ or contact
Izard Nobel LLP toll-free: (800) 797-5499, or by e-mail:
firm@izardnobel.com On the Net: http://www.izardnobel.com/
About Fleetwood Enterprises
Founded in 1950, Fleetwood Enterprises, Inc. (NASDAQ: FLE) and its
various subsidiaries produce, distribute, and service recreational
vehicles and manufactured housing. Fleetwood employed 2,100
people in 14 plants located in 10 states.
Based in Riverside, California, Fleetwood Enterprises, Inc.,
together with 19 of affiliates, filed for Chapter 11 protection on
March 10, 2009 (Bankr. C.D. Calif. Lead Case No. 09-14254). Craig
Millet, Esq., and Solmaz Kraus, Esq., at Gibson, Dunn & Crutcher
LLP, represent the Debtors in their restructuring efforts. FTI
Consulting Inc. is the financial advisors to the Debtors. The
Debtors tapped Greenhill & Co.. LLC as its investment banker.
Fleetwood was authorized in June to sell its recreational vehicle
business for $53 million to private-equity investor American
Industrial Partners.
FORMTECH INDUSTRIES: Gets Initial OK to Access $4.8MM DIP Loan
--------------------------------------------------------------
The Hon. Mary Walrath of the U.S. Bankruptcy Court for the
District of Delaware authorized Formtech Industries LLC and
Formtech Industries Holdings LLC to (i) obtain $4,855,532 in
postpetition senior secured superpriority financing, under the
debtor-in-possession credit and guaranty agreement dated Aug. 26,
2009, from HHI Funding LLC as administrative and collateral agent,
and (ii) access cash collateral of prepetition secured parties,
both on an interim basis.
HHI Funding has agreed to provide $8,500,000 in financing on a
final basis. A hearing is set for Sept. 15, 2009, at 11:30 a.m.,
to consider final approval.
The DIP facility incurs interest at the "adjusted LIBOR rate" --
with a 4% per annum floor -- plus 12% per annum. Default rate is
2% over the applicable interest rate. The DIP facility will
mature on the earliest to occur of Oct. 10, 2009, or the date of
the occurrence of an event of default.
Proceeds of the DIP facility will be used solely to (i) pay
principal, interest, fees and expenses associated with the
financing including an underwriting fee of 2% of the DIP facility
and 1% of the DIP facility commitment amount; (ii) pay the
prepetition lender expenses under the existing terms of the
prepetition credit agreement; and (iii) fund general, ordinary
course corporate and working capital requirements of the Debtors.
The DIP facility contains appropriate and customary events of
default.
Secured creditor Gerdau MacSteel Inc. objected to the Debtors'
request for financing and requested that all encumbered assets and
avoidance actions be excepted from the liens and administrative
expense priorities to HHI Funding the Debtors' secured creditors
to prevent prejudice to the unsecured creditors.
According to Gerdau, the transfer in value from unsecured
creditors to secured creditors can be justified only where the
financing will provide a benefit to unsecured creditors in
exchange for the value of the unencumbered assets. However, in
this case, it is reasonably clear from the pleadings that the
Debtors anticipate that the secured lenders are grossly under
secured.
"This is not a traditional financing, but only part of a larger
proposed sale transaction for the benefit of HHI. The continued
operations of the Debtors will be of little or no benefit to
the unsecured creditors, and will not offset or compensate the
unsecured creditors for the loss in value requested through the
financing motion," said Justin R. Alberto, Esq., at Bayard P.A.,
attorney of Gerdau MacSteel.
About Formtech Industries
Based in Royal Oak, Michigan, FormTech Industries LLC --
http://www.formtech2.com/-- is among the largest independent
manufacturers of forged automotive parts in North America and the
leader in high volume hot-formed manufacturing through its
operations in Royal Oak, Michigan and Tonawanda, New York.
FormTech was adversely impacted by the precipitous decline in
automotive production in the first half of 2009. Through this
time period, FormTech remained a highly reliable supplier and
substantially restructured its operations. The company has over
400 employees, primarily in Michigan and Ohio and operates six
manufacturing facilities. The company and its affiliate, FormTech
Industries Holdings LLC, filed for Chapter 11 protection on Aug.
26, 2009 (Bankr. D. Del. Case Nos. 09-12964 and 09-12965). Lynn
M. Brimer, Esq., Meredith E. Taunt, Esq., and Andrew A. Ayar,
Esq., at Strobl & Sharp, P.C., represent the Debtors in their
restructuring efforts. The Debtors selected Steven M. Yoder,
Esq., Jeremy W. Ryan, Esq., and, R. Stephen McNeill, Esq., at
Potter Anderson & Corroon LLP, as co-counsel, and Kurtzman Carson
Consultants LLC, as claims agent. In their petition, the Debtors
listed assets between $100 million and $500 million, and debts
between $50 million and $100 million.
FORMTECH INDUSTRIES: Selects CM&D as Restructuring Officer
----------------------------------------------------------
Formtech Industries LLC and Formtech Industries Holdings LLC ask
the U.S. Bankruptcy Court for the District of Delaware for
authority to employ CM&D Management Services LLC, which has agreed
to:
a) evaluate options for maximizing asset value;
b) improve profitability and reducing costs;
c) coordinate the information required to support the sale
process;
d) formulate, negotiate, and promulgate a plan for the
disposition of some or all of the Debtors' assets;
e) coordinate issues relating to the bankruptcy filing for
employees, customers and creditors; and
f) assist in complying with debtor-in-possession reporting
requirements.
As part of the engagement, the firm's A. Jeffrey Zappone will
serve as chief restructuring officer of the Debtors.
The Debtors propose to pay the firm at these hourly rates:
A. Jeffrey Zappone $625
Joshua J. Siano $425
Mandy W. Townsend $425
The Debtors assure the Court that the firm is a "disinterested
person" as that term defined in Section 101(14) of the Bankruptcy
Code.
About Formtech Industries
Based in Royal Oak, Michigan, FormTech Industries LLC --
http://www.formtech2.com/-- is among the largest independent
manufacturers of forged automotive parts in North America and the
leader in high volume hot-formed manufacturing through its
operations in Royal Oak, Michigan and Tonawanda, New York.
FormTech was adversely impacted by the precipitous decline in
automotive production in the first half of 2009. Through this
time period, FormTech remained a highly reliable supplier and
substantially restructured its operations. The company has over
400 employees, primarily in Michigan and Ohio and operates six
manufacturing facilities. The company and its affiliate, FormTech
Industries Holdings LLC, filed for Chapter 11 protection on
Aug. 26, 2009 (Bankr. D. Del. Case Nos. 09-12964 and 09-12965).
Lynn M. Brimer, Esq., Meredith E. Taunt, Esq., and Andrew A. Ayar,
Esq., at Strobl & Sharp, P.C., represent the Debtors in their
restructuring efforts. The Debtors selected Steven M. Yoder,
Esq., Jeremy W. Ryan, Esq., and, R. Stephen McNeill, Esq., at
Potter Anderson & Corroon LLP, as co-counsel, and Kurtzman Carson
Consultants LLC, as claims agent. In their petition, the Debtors
listed assets between $100 million and $500 million, and debts
between $50 million and $100 million.
FREEDOM COMMUNICATIONS: Can Hire Logan & Company as Claims Agent
----------------------------------------------------------------
The Hon. Kevin J. Carey of the U.S. Bankruptcy Court for the
District of Delaware authorized Freedom Communications Holdings
Inc. and its debtor-affiliates to employ Logan & Company Inc. as
their claims, noticing and balloting agent.
The firm is expected to (i) distribute required notices to
parties-in-interest; (ii) receive, maintain, docket, and otherwise
administer the proofs of claims and proofs of interest filed in
the Chapter 11 cases; (iii) tabulate, if necessary, acceptances
and rejections for all claims, and (iv) provide such other
administrative services that the Debtors may require, among other
things.
The firm's hourly rates for consulting services are:
Principal $270
Court Testimony $300
Statement & Schedule Preparation $200
Account Executive Support $185
Public Website Design & Maintenance $185
Programming Support $150
Project Coordinator $125
Data Prep Analysis $100
The Debtors assured the Court that the firm is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.
About Freedom Communications
Freedom Communications, headquartered in Irvine, Calif., is a
national privately owned information and entertainment company of
print publications, broadcast television stations and interactive
businesses. The company's print portfolio includes approximately
90 daily and weekly publications, including approximately 30 daily
newspapers, plus ancillary magazines and other specialty
publications. The broadcast company's stations -- five CBS, two
ABC network affiliates and one CW affiliate -- reach more than
3 million households across the country. The Company's news,
information and entertainment Web sites complement its print and
broadcast properties.
Freedom Communications filed for Chapter 11 on Sept. 1, 2009
(Bankr. D. Del. Case No. 09-13046). Attorneys at Young Conaway
Stargatt & Taylor, and Latham & Watkins LLP serve as Chapter 11
counsel. Houlihan, Lokey, Howard & Zukin, Inc., serves as
financial advisor while AlixPartners LLC is restructuring
consultant. Logan & Co. serves as claims and notice agent.
Freedom Communications had $757,000,000 in assets against debts of
$1,077,000,000 as of July 31, 2009.
FREEDOM COMMUNICATIONS: Gets Temporary Nod to Use JPMorgan Cash
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized,
on an interim basis, Freedom Communications Inc. and its debtor-
affiliates to:
-- use cash collateral and any other collateral in which the
prepetition agent and the prepetition lenders have an
interest; and
-- grant adequate protection to the prepetition lenders with
respect to any diminution in the value of the prepetition
lenders' interest in the prepetition collateral.
A final hearing on the Debtors' continued use of cash collateral
and the objection deadline will be held at a date and time to be
scheduled by the Court and noticed to the parties-in-interest.
The Debtors relate that they have an immediate to use the cash
collateral to continue their business operations.
As of Freedom Communications' petition date, the Debtors were
indebted to JP Morgan Chase Bank, N.A., as administrative agent
for the prepetition lenders, pursuant to the credit agreement
dated as of May 18, 2004, as amended, in the principal amount of
$770.55 million plus accrued and unpaid interest.
The Debtors were also liable to the issuing banks under the
prepetition credit agreement of not less than $1.93 million.
As adequate protection, the Debtors will grant the prepetition
lenders: (i) adequate protection liens; (ii) superpriority claim,
subject to the payment of carve out; and (iii) payment of all
accrued and unpaid interest on the prepetition obligation at the
rates applicable immediately before the petition date.
The Debtors' use of the cash collateral will expire on the earlier
to occur of (i) 11:59 p.m. (New York City time) of 60 days after
the petition date, unless prior thereto the Debtors have filed a
disclosure statement in form and substance satisfactory to the
consenting lenders; (ii) 11:59 p.m. (New York City time) of 90
days after the petition date, unless prior thereto the Court has
issued an order approving the disclosure statement; (iii) 11:59
p.m. (New York City time) of 150 days after the petition date,
unless prior thereto the plan has been confirmed; (iv) 11:59 p.m.
(New York City time) on the consummation deadline; and (v) the
occurrence of an event of default.
A full-text copy of the Budget is available for free at:
http://bankrupt.com/misc/FreedomComms_Budget.pdf
About Freedom Communications
Freedom Communications, headquartered in Irvine, Calif., is a
national privately owned information and entertainment company of
print publications, broadcast television stations and interactive
businesses. The company's print portfolio includes approximately
90 daily and weekly publications, including approximately 30 daily
newspapers, plus ancillary magazines and other specialty
publications. The broadcast company's stations -- five CBS, two
ABC network affiliates and one CW affiliate -- reach more than 3
million households across the country. The Company's news,
information and entertainment Web sites complement its print and
broadcast properties.
Freedom Communications filed for Chapter 11 on Sept. 1, 2009
(Bankr. D. Del. Case No. 09-13046). Attorneys at Young Conaway
Stargatt & Taylor, and Latham & Watkins LLP serve as Chapter 11
counsel. Houlihan, Lokey, Howard & Zukin, Inc., serves as
financial advisor while AlixPartners LLC is restructuring
consultant. Logan & Co. serves as claims and notice agent.
Freedom Communications had $757,000,000 in assets against debts of
$1,077,000,000 as of July 31, 2009.
GENERAL GROWTH: Committee Members Want Trading In of Claims
-----------------------------------------------------------
Creditors Committee members General Electric Capital Corporation
joins in Eurohypo AG, New York Branch, and Calyon New York
Branch's motion to permit trading of claims against General Growth
Properties Inc.
In another filing, American High-Income Trust asks the Court to
permit its trading of "Covered Claims," including securities
defined in Section 2(a)(1) of the Securities Act of 1993, and
bank debt against the Debtors by adopting substantially the same
information blocking procedures proposed by Eurohypo, et al.
General Electric and American High-Income are members of the
Official Committee of Unsecured Creditors. Pursuant to the
information blocking procedures, Daniel Wallitt, vice president
in General Electric's Bank Loan Group, and Ellen Carr, investment
analyst of American High-Income Trust, will serve as the
representative on behalf of the Creditors' Committee in the
Debtors' Chapter 11 cases.
About General Growth
Based in Chicago, Illinois, General Growth Properties, Inc. --
http://www.ggp.com/-- is the second-largest U.S. mall owner,
having ownership interest in, or management responsibility for,
more than 200 regional shopping malls in 44 states, as well as
ownership in master planned community developments and commercial
office buildings. The Company's portfolio totals roughly ]
200 million square feet of retail space and includes more than
24,000 retail stores nationwide. General Growth is a self-
administered and self-managed real estate investment trust. The
Company's common stock is trading in the pink sheets under the
symbol GGWPQ.
General Growth Properties Inc. and its affiliates filed for
Chapter 11 on April 16, 2009 (Bankr. S.D.N.Y., Case No.
09-11977). Marcia L. Goldstein, Esq., Gary T. Holtzer, Esq.,
Adam P. Strochak, Esq., and Stephen A. Youngman, Esq., at Weil,
Gotshal & Manges LLP, have been tapped as bankruptcy counsel.
Kirkland & Ellis LLP is co-counsel. Kurtzman Carson Consultants
LLC has been engaged as claims agent. The Company also hired
AlixPartners LLP as financial advisor and Miller Buckfire Co. LLC,
as investment bankers. The Debtors disclosed
$29,557,330,000 in assets and $27,293,734,000 in debts as of
December 31, 2008.
Bankruptcy Creditors' Service, Inc., publishes General Growth
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by General Growth Properties Inc. and its various
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
GENERAL GROWTH: Proposes Nov. 10 Claims Bar Date
------------------------------------------------
General Growth Properties, Inc., and its debtor affiliates ask
Judge Allan Groper of the United States Bankruptcy Court for the
Southern District of New York to:
(i) establish November 10, 2009, as the deadline for parties
to file proofs of claim in the Debtors' Chapter 11 cases;
and
(ii) approve procedures for filing proofs of claim.
Rule 3003(c)(3) of the Federal Rules of Bankruptcy Procedures
provides that the Court will fix the time within which claimants
must file a proof of claim in a Chapter 11 case pursuant to
Section 501 of the Bankruptcy Code. Moreover, Rule 3003(c)(2)
provides that any creditor who asserts a claim against the
Debtors that (a) arose prior to April 16, 2009, or April 23,
2009, as applicable, and is not scheduled in the Debtors'
schedules of assets and liabilities; or (b) is listed on the
Schedules as disputed, contingent, or unliquidated must file a
proof of claim. The Debtors filed their Schedules on August 26,
2009.
Sylvia A. Mayer, Esq., at Weil, Gotshal & Manges LLP, in New
York, discloses that about 89,000 entities may be creditors in
the Debtors' Chapter 11 cases. She asserts that establishing
November 10, 2009, as the Bar Date and approving the proposed
procedures will enable the Debtors to mail a Bar Date notice,
afford ample opportunity for creditors to file Proofs of Claim,
and allow the Debtors to receive, process, and begin their
analysis of the filed claims in a timely and efficient manner,
she says.
Consistent with Section 501(a), trustees under these indentures
will each file a master proof of claim on behalf of all holders
under:
* an indenture dated February 24, 1995, pursuant to which The
Rouse Company, LP issued five series of public bonds;
* an indenture dated May 5, 2006, pursuant to which TRCLP and
TRC Co-Issuer, Inc. issued one series of bonds in a private
placement;
* an indenture dated April 16, 2007, pursuant to which GGP
Limited Partnership issued $1.55 billion of 3.98%
Exchangeable Senior Notes pursuant to Rule 144(A) under the
Securities Act of 1933; and
* a Junior Subordinated Indenture dated February 24, 2006,
pursuant to which GGP Capital Trust I holds $206.2 million
of junior subordinated notes issued by GGP LP and issued
$200 million of trust preferred securities held by outside
Investors.
Any administrative agent and, for commercial mortgage backed
securities loans, the special servicer and noticing agent, for
the Debtors' prepetition secured loans may file a single master
proof of claim against the applicable Debtor on behalf of all
parties holding a direct interest in the applicable Project Level
Debt for the repayment of principal, interest and other
applicable fees and charges and any other amounts owed under the
prepetition loan documents related to the Project Level Debt
under which it serves as administrative agent or CMBS Special
Servicer, and will include in the master proof of claim a
schedule identifying any underlying notes and trusts and listing
the amounts owed.
Any Trustee, administrative agent or CMBS Special Servicer filing
a master proof of claim with respect to the 1995 Rouse Bonds,
2006 Rouse Bonds, GGP LP Notes, TRUPS Notes or Project Level Debt
need only file a proof of claim against the Debtors acting as the
primary obligor on the underlying debt obligation and that proof
of claim will be deemed to have been filed against any Debtors
identified as guarantors or secondary obligors. Upon filing of
any master proofs of claim with respect to the Bank/Bond Claims,
each beneficial holder of the Bank/Bond Claims will be deemed to
have filed a proof of claim in their pro rata share of the amount
set forth in the master proof of claim without the necessity of
filing separate claims. To the extent any holder of the
Bank/Bond Debt wishes to assert a claim arising out of or
relating to the Bank/Bond Claim and unrelated to the repayment of
principal, interest and other applicable fees, then the claimant
must file a Proof of Claim asserting a claim on or before the Bar
Date.
Pursuant to the Personal Injury Procedures Order, the personal
injury claimants are required to produce certain documentation in
support of their claims and must file a proof of claim in the
applicable Debtor's case pursuant to the procedures approved.
Procedures for Filing Proofs of Claim
The Debtors propose these procedures for filing proofs of claim:
(a) the deadline to file a proof of claim for each person or
entity, to assert a claim against any Debtor that arose
before the Petition Date is November 10, 2009, at
5:00 p.m.;
(b) Proofs of claim must specify the Debtor by name and case
number against which the Proof of Claim is filed; the
legal basis for the alleged claim; and supporting
documentation;
(c) If a claimant asserts a claim against more than one
Debtor, the claimant must file a separate proof of claim
against each Debtor;
(d) proofs of claim will be deemed timely filed only if
received by the Debtors' claim agent Kurtzman Carson
Consultants, LLC, or by the Court;
(e) any person or entity that holds a claim that arises from
the rejection of an executory contract or unexpired lease
must file a proof of claim based on the rejection by the
later of (i) Bar Date or (ii) the date is the fixed by the
Court in the applicable rejection order, or 30 days after
that rejection, or be forever barred from doing so;
(f) a party to an executory contract or unexpired lease that
asserts a claim on account of unpaid amounts accrued and
outstanding as of the Petition Date pursuant to the
executory contract or unexpired lease must file a Proof of
Claim for those amounts on or before the Bar Date;
(g) In the event the Debtors amend their Schedules to (i)
designate a claim as disputed, contingent, unliquidated,
or undetermined; (ii) change the amount of a claim; or
(iii) add a claim that was listed on the Schedules, the
Debtors will notify the claimant of the amendment. The
deadline for any holder of an amended claim to file a
Proof of Claim is the later of the Bar Date or the date
that is 30 days after the Debtors provide notice of the
amendment.
Moreover, these entities are not required to file a Proof of
Claim on or before the Bar Date:
* any person or entity whose claim is listed on the Schedules
and (i) whose claim is not disputed, contingent, or
unliquidated, (ii) who does not dispute the amount, nature
or priority of the claim set forth in the Schedules, and
(iii) who does not dispute that the claim is an obligation
of the specific Debtor against which the claim is listed on
the Schedules;
* any person or entity that holds an interest in the Debtors,
which interest is based exclusively upon the ownership of
common or preferred stock, membership interests, partnership
interests, or warrants or rights to purchase, sell or
subscribe to a security or interest; provided that interest
holders that wish to assert claims against the Debtors must
file Proofs of Claim on or before the Bar Date;
* any person or entity whose claim has been paid in full by
the Debtors;
* any holder of a claim allowable as an administrative expense
under Sections 503(b) and 507(a)(2), provided that any party
asserting a claim pursuant to Section 503(b)(9) must file a
Proof of Claim on or before the Bar Date;
* any person or entity that holds a claim that has been
allowed by an order of the Court entered on or before the
Bar Date;
* any holder of a claim for which a separate deadline is fixed
by the Court;
* any holder of a claim that is limited exclusively to the
repayment of the Bank/Bond Claims to the extent that the
applicable Trustee, administrative agent or CMBS Servicer
timely filed a master proof of claim on behalf of all
holders of the claims;
* any Debtor in these Chapter 11 cases having a claim against
another Debtor;
* any wholly owned subsidiary of any Debtor having a claim
against a Debtor; and
* any holder of a claim who has already properly filed a Proof
of Claim against the Debtors with the Clerk of the Court or
KCC.
Moreover, pursuant to Rule 3003(c)(2), the Debtors ask the Court
to find that any holder of claim against the Debtors that is
required to do so but failed to file a proof of claim on or
before the Bar Date, will be forever barred from asserting that
claim against the Debtors' estates. The Debtors further ask the
Court to hold that any holder of that claim will not be permitted
to vote or accept or reject any Chapter 11 plan filed by the
Debtors, or participate in any distribution in the Debtors'
Chapter 11 cases with respect to that claim.
Bar Date Notice
Pursuant to Rule 2002(a)(7), (f) and (l), the Debtors propose
that on October 6, 2009 or at least 35 days prior to the Bar
Date, they will serve a Bar Date Notice and a Proof of Claim Form
to the United States Trustee for Region 2; counsel for the
Official Committee of Unsecured Creditors; all known holders of
claims listed on the Schedules; all parties known to the Debtors
as having potential claims against the Debtors' estates; all
counterparties to the Debtors' executory contracts and unexpired
leases listed on the Schedules; all parties to litigation with
the Debtors; in accordance with Rule 2002(j), the Internal
Revenue Service, the United States Attorney's Office for the
Southern District of New York; and all parties who have requested
notice pursuant to Rule 2002. At least 25 days prior the Bar
Date or October 16, 2009, the Debtors will publish the Bar Date
Notice once in the Wall Street Journal National Edition and the
Chicago Tribune. The Debtors will also post the Proof of Claim
Form and Bar Date Notice on KCC's web site at
www.kccllc.net/GeneralGrowth
Ms. Mayer tells the Court that the Proof of Claim conforms
substantially to Official Form No. 10 and the Bar Date Notice
conforms to the Procedural Guidelines of the U.S. Bankruptcy
Court for the Southern District of New York. More importantly,
she notes that the proposed 35-day notice provides sufficient
time for all parties-in-interest to assert their claims. She
also insists that the proposed notice procedures are reasonably
calculated to provide notice to all parties that may wish to
assert a claim in the Debtors' Chapter 11 cases.
The Court will consider the Debtors' request on September 25,
2009. Objections are due September 18.
About General Growth
Based in Chicago, Illinois, General Growth Properties, Inc. --
http://www.ggp.com/-- is the second-largest U.S. mall owner,
having ownership interest in, or management responsibility for,
more than 200 regional shopping malls in 44 states, as well as
ownership in master planned community developments and commercial
office buildings. The Company's portfolio totals roughly ]
200 million square feet of retail space and includes more than
24,000 retail stores nationwide. General Growth is a self-
administered and self-managed real estate investment trust. The
Company's common stock is trading in the pink sheets under the
symbol GGWPQ.
General Growth Properties Inc. and its affiliates filed for
Chapter 11 on April 16, 2009 (Bankr. S.D.N.Y., Case No.
09-11977). Marcia L. Goldstein, Esq., Gary T. Holtzer, Esq.,
Adam P. Strochak, Esq., and Stephen A. Youngman, Esq., at Weil,
Gotshal & Manges LLP, have been tapped as bankruptcy counsel.
Kirkland & Ellis LLP is co-counsel. Kurtzman Carson Consultants
LLC has been engaged as claims agent. The Company also hired
AlixPartners LLP as financial advisor and Miller Buckfire Co. LLC,
as investment bankers. The Debtors disclosed
$29,557,330,000 in assets and $27,293,734,000 in debts as of
December 31, 2008.
Bankruptcy Creditors' Service, Inc., publishes General Growth
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by General Growth Properties Inc. and its various
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
GENERAL GROWTH: Rouse Providence's Schedules of Assets & Debts
--------------------------------------------------------------
A. Real Property
Owned
Mall -- Construction in Progress; One
Providence Place $18,010
Mall -- One Providence Place 442,816,131
B. Personal Property
B.1 Cash on hand
Petty Cash - Cash Drawer 970
B.2 Bank Accounts
Citizens Bank 1,336,796
B.3 Security Deposits with public utilities
Laz Parking Mgmt. Ltd. 54,000
Noreast Capital Corp. 1,254
Sprague Energy Group 94,807
B.9 Interests in insurance policies
Lexington Insurance Company Lead & Various 107,502
Liberty Insurance Co. - GL, WC, Auto 3,884
B.13 Stock and interests in incorporated and Undetermined
unincorporated
See at http://bankrupt.com/misc/rp_B13Interests.pdf
B.14 Interests in partnerships or joint ventures
Domains Undetermined
Trademark Undetermined
B.16 Accounts receivable 2,557,201
B.22 Patents, copyrights and other intellectual
property Undetermined
B.24 Customer lists or other compilations Undetermined
B.25 Vehicles 1,305
B.28 Office equipment, furnishings, and supplies 43,785
B.29 Machinery, fixtures, equipment and supplies 696,586
B.35 Other Personal Property
Prepaid Expenses and Other assets 273,125
TOTAL SCHEDULED ASSETS $448,005,355
==========================================================
C. Property Claimed as Exempt $0
D. Creditors Holding Secured Claims
Secured Debt
LaSalle Bank National Association 47,596,046
The Bank of New York Mellon Trust Company,
N.A. 357,250,887
Secured Tax Claims and related claims
City of Providence 0
E. Creditors Holding Unsecured Priority Claims
Priority Claims - Sales and Use Tax Liabilities
State of Rhode Island 0
Priority Claims - Franchise Tax/Business License Fee/Other
Liabilities
Delaware Secretary of State 0
F. Creditors Holding Unsecured Non-priority Claims
Accounts Payable 598,905
See at http://bankrupt.com/misc/rp_AccountsPayable.pdf
Litigation
Antonitis, Victoria Unliquidated
Betancourt-Espada, Aileen Unliquidated
Gravel, Donna Unliquidated
Silva, Karen Unliquidated
Tenant Obligations
American Eagle Outfitters 113
AT&T Unliquidated
Cingular Wireless 1,113
Hot Topic 601
J. Jill Petite 263,360
So Fresh and So Clean LLC 857
Tiffany & Co. 9,778
Zales Jewelers 1,000
TOTAL SCHEDULED LIABILITIES $405,722,661
===========================================================
About General Growth
Based in Chicago, Illinois, General Growth Properties, Inc. --
http://www.ggp.com/-- is the second-largest U.S. mall owner,
having ownership interest in, or management responsibility for,
more than 200 regional shopping malls in 44 states, as well as
ownership in master planned community developments and commercial
office buildings. The Company's portfolio totals roughly ]
200 million square feet of retail space and includes more than
24,000 retail stores nationwide. General Growth is a self-
administered and self-managed real estate investment trust. The
Company's common stock is trading in the pink sheets under the
symbol GGWPQ.
General Growth Properties Inc. and its affiliates filed for
Chapter 11 on April 16, 2009 (Bankr. S.D.N.Y., Case No.
09-11977). Marcia L. Goldstein, Esq., Gary T. Holtzer, Esq.,
Adam P. Strochak, Esq., and Stephen A. Youngman, Esq., at Weil,
Gotshal & Manges LLP, have been tapped as bankruptcy counsel.
Kirkland & Ellis LLP is co-counsel. Kurtzman Carson Consultants
LLC has been engaged as claims agent. The Company also hired
AlixPartners LLP as financial advisor and Miller Buckfire Co. LLC,
as investment bankers. The Debtors disclosed
$29,557,330,000 in assets and $27,293,734,000 in debts as of
December 31, 2008.
Bankruptcy Creditors' Service, Inc., publishes General Growth
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by General Growth Properties Inc. and its various
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
GENERAL GROWTH: Rouse Providence's Statement of Fin'l Affairs
-------------------------------------------------------------
Rouse Providence LLC discloses that during the two years
immediately preceding the Petition Date, it received income from
gross sales from operations, excluding intercompany operations:
Year Income
---- ------
2007 $46,182,843
2008 43,912,346
2009 11,442,539
Edmund Hoyt, senior vice president and chief financial officer of
the Debtors, reports that two years immediately preceding the
Petition Date, the Debtor received income from sources other than
the operation of its business:
Year Income
---- ------
2007 $7,846,709
2008 7,621,532
2009 1,782,376
Mr. Hoyt notes that the Debtors made payments aggregating
$1,247,815 to creditors within 90 days immediately preceding the
Petition Date. A schedule of the payments made to creditors is
available for free at:
http://bankrupt.com/misc/rp_paymentstocreditors.pdf
Moreover, Mr. Hoyt relates that the Debtor made payments totaling
$8,296,969, within one year immediately preceding the Petition
Date to creditors who are or were insiders. A schedule of the
payments made to insiders is available for free at:
http://bankrupt.com/misc/rp_paymentstoinsiders.pdf
Rouse Providence are parties to five lawsuits.
According to Mr. Hoyt, the Debtor suffered losses for $100,000
when its mall property was damaged by power failure a year
immediately preceding the Petition Date.
In the ordinary course of business, Rouse Providence may be
obligated to withhold amounts from the paychecks of various
regular employees in connection with garnishment orders or other
state law withholding orders. Rouse Providence believes that
these amounts do not constitute property of the estate and, thus
did not list those amounts. Moreover, out of concerns for the
confidentiality of Rouse Providence's employees, Rouse Providence
has not listed any garnishment, Mr. Hoyt says.
Mr. Hoyt discloses that the Debtor has three financial accounts,
which were closed within one year immediately preceding the
Petition Date:
Bank Account Description Close Date
---- ------------------- ----------
M&T Bank Bank Account 3/29/2009
US Bank Analyzed Checking 4/02/2009
Wachovia Bank Gift Card 1/08/2009
In the ordinary course of its business prior to the Petition
Date, Rouse Providence routinely agreed to provide rent credits
or other setoffs to tenants under real property leases as a
result of tenant overpayments of non-rent items, tenant
improvement allowances and other matters. Given the large number
and normal course nature of those setoffs, Rouse Providence has
not reflected those setoffs.
The Debtor's bookkeepers and accountants who within the two years
immediately preceding the Petition Date kept or supervised the
keeping of books and records.
Name Title Period
---- ----- ------
Edmund Hoyt Chief Financial Officer 10/3/08 to
present
Bernard Freibaum Chief Financial Officer 10/18/93 to
10/3/08
Deloitte & Touche LLP has audited the books and records and
prepared a financial statement of the Debtor within two years
preceding the Petition Date.
Mr. Hoyt notes that General Growth files reports with the
Securities and Exchange Commission, which contain consolidated
financial information relating to General Growth and its
affiliates. Since the SEC Filings are of public record, the
Debtors do not maintain records of the parties who requested or
obtained copies of any of the SEC Filings, the Debtors or other
sources. In addition, the Debtors provide reporting information
to lenders as required by their individual loan agreements, which
information may include financial statements of the Debtors.
The Debtor's current officers and shareholders are:
Name Title
---- -----
Adam S. Metz Chief Executive Officer
Carol A. Williams Assistant Secretary
Charles H. Cremens Manager
Edmund J. Hoyt Treasurer
Howard Sigal Assistant Secretary
James W. Brewster Senior Vice President
John V. Howard Assistant Secretary
Kathleen Courtis Vice President
Linda J. Wight Vice President & Assistant
Secretary
Melinda Holland Senior Vice President
Michael Chimitris Assistant Secretary
Robert A. Michaels Chief Operating Officers
Ronald L. Gern Senior Vice President &
Secretary
Sharon Polonia Executive Vice President
Thomas H. Nolan, Jr. Manager/President
The Debtor's Former Partners And Shareholders are:
Name Title
---- -----
Bernard Freibaum Manager, Executive Vice
President
and Treasurer
James D. Lano Assistant Secretary
Jean Schlemmer Senior Vice President
John W. Steele, III Assistant Secretary
Mary S. Stawikey Manager
Suzanne M. Hay Manager
About General Growth
Based in Chicago, Illinois, General Growth Properties, Inc. --
http://www.ggp.com/-- is the second-largest U.S. mall owner,
having ownership interest in, or management responsibility for,
more than 200 regional shopping malls in 44 states, as well as
ownership in master planned community developments and commercial
office buildings. The Company's portfolio totals roughly
200 million square feet of retail space and includes more than
24,000 retail stores nationwide. General Growth is a self-
administered and self-managed real estate investment trust. The
Company's common stock is trading in the pink sheets under the
symbol GGWPQ.
General Growth Properties Inc. and its affiliates filed for
Chapter 11 on April 16, 2009 (Bankr. S.D.N.Y., Case No.
09-11977). Marcia L. Goldstein, Esq., Gary T. Holtzer, Esq.,
Adam P. Strochak, Esq., and Stephen A. Youngman, Esq., at Weil,
Gotshal & Manges LLP, have been tapped as bankruptcy counsel.
Kirkland & Ellis LLP is co-counsel. Kurtzman Carson Consultants
LLC has been engaged as claims agent. The Company also hired
AlixPartners LLP as financial advisor and Miller Buckfire Co. LLC,
as investment bankers. The Debtors disclosed
$29,557,330,000 in assets and $27,293,734,000 in debts as of
December 31, 2008.
Bankruptcy Creditors' Service, Inc., publishes General Growth
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by General Growth Properties Inc. and its various
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
GENERAL MOTORS: Global DiSCS Trust Says Recovery Amount at 12.63%
-----------------------------------------------------------------
Global DiSCS Trust 2004-1 (TSX:DST.UN) said the final recovery
amount of the General Motors Corporation Credit Event is 12.63%.
The Bankruptcy Credit Event will not result in any reduction in
collateral or an investor's capital amount.
On June 2, 2009, the Trust was notified of a Credit Event in
respect of GM. The exposure of the Trust to the Corporation is
0.50% of the Reference Portfolio.
Following the Corporation's Bankruptcy Credit Event, the Trust's
remaining synthetic first-loss tranche protection is 2.456% of the
Reference Portfolio. The initial 4.10% first-loss tranche was
reduced to 2.904% as a result the Credit Events involving Delphi
Corporation, Quebecor World Inc., Federal National Mortgage
Association, Federal Home Loan Mortgage Corporation, The Rouse
Company and Idearc Inc.
Unitholders' entitlement to receive $25 per Trust unit on December
20, 2009 and quarterly distributions of $0.325 per unit will not
be affected by this Bankruptcy Credit Event. However, if the
future Cumulative Net Loss Amounts resulting from Credit Events
exceed 2.456%, the Trust's unitholders will receive less than the
original subscription price of $25 per Trust unit upon the
Maturity Date.
The units of Global DiSCS Trust 2004-1 are listed for trading on
the Toronto Stock Exchange under the symbol DST.UN. As of
September 2, 2009, the net asset value of the Trust was $22.60 per
unit.
Sentry Select Capital Inc.
Sentry Select Capital Inc. is a Canadian wealth management company
that offers a diverse range of investment products including
closed-end trusts, mutual funds, principal-protected notes and
flow-through limited partnerships, covering a variety of domestic
and global mandates.
About General Motors
Headquartered in Detroit, Michigan, General Motors Corp.
(NYSE: GM) -- http://www.gm.com/-- as 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 US$6.0 billion, including special items, in the first quarter
of 2009. This compares with a reported net loss of US$3.3 billion
in the year-ago quarter. As of March 31, 2009, GM had
US$82.2 billion in total assets and US$172.8 billion in total
liabilities, resulting in US$90.5 billion in stockholders'
deficit.
General Motors Corporation and three of its affiliates filed for
Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case
No. 09-50026). General Motors changed its name to Motors
Liquidation Co. following the sale of its key assets to a company
60.8% owned by the U.S. Government.
The Honorable Robert E. Gerber presides over the Chapter 11 cases.
Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H.
Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors
in their restructuring efforts. Al Koch at AP Services, LLC, an
affiliate of AlixPartners, LLP, serves as the Chief Executive
Officer for Motors Liquidation Company. GM is also represented by
Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as
counsel. Cravath, Swaine, & Moore LLP is providing legal advice
to the GM Board of Directors. GM's financial advisors are Morgan
Stanley, Evercore Partners and the Blackstone Group LLP.
Bankruptcy Creditors' Service, Inc., publishes General Motors
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by General Motors Corp. and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
GENTA INC: Closes Sale of $10 Million in Units to Investors
-----------------------------------------------------------
Genta Incorporated has closed a second tranche of a previously
announced offering with institutional investors to place Units
consisting of 30% of Common Stock and 70% of Unsecured Subordinate
Convertible Notes totaling $7 million in gross proceeds before
fees and expenses.
In connection with the sale of the Units, the Company also issued
to the investors two-year warrants to purchase Common Stock in an
amount equal to 25% of the number of shares of Common Stock
issuable upon conversion of the Notes purchased by each investor.
Closing of the first tranche of $3 million of Units under this
Offering occurred on July 7, 2009.
In a separate transaction, the Company closed an additional
$3 million Offering with institutional investors on the same terms
and conditions as the $7 million tranche, for an aggregate total
from both closings of $10 million.
In these Offerings, shares of Common Stock in the Units were sold
at the price of $0.10 per share. The two-year Notes bear interest
at an annual rate of 8% payable at semi-annual intervals in cash
or in notes with similar terms at the Company's option. The Notes
will be convertible into shares of Genta common stock at a
conversion rate of 10,000 shares of common stock for every
$1,000.00 of principal. The Company shall have the right to force
conversion of the new Notes, and all other outstanding senior
secured notes, if the closing bid price of the Company's common
stock exceeds $0.50 for a period of 10 consecutive trading days
and certain other conditions are met.
Dr. Raymond P. Warrell, Jr., Genta's Chief Executive Officer,
noted: "The proceeds of these Offerings provide funding of the
Company into 2010 and ensure our ability to analyze and release
the primary data from AGENDA, our randomized Phase 3 trial of
Genasense(R) in patients with advanced melanoma. We continue to
anticipate release of these results in the fourth quarter of this
year."
Rodman & Renshaw, LLC, a wholly-owned subsidiary of Rodman &
Renshaw Capital Group, Inc. (RODM 5.30, +0.37, +7.51%) served as
the exclusive placement agent for the offerings.
About Genta Incorporated
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.
At June 30, 2009, Genta had $10.2 million in total assets; and
$12.1 million in total current liabilities and $2.46 million in
total long-term liabilities, resulting in $4.33 million in
stockholders' deficit.
In its second quarter 2009 report on Form 10-Q, the Company said
its recurring losses and negative cash flows from operation raise
substantial doubt about its ability to continue as a going
concern.
GEORGIA GULF: Registers 1,326,862 Shares for Resale
---------------------------------------------------
Georgia Gulf Corporation filed with the Securities and Exchange
Commission:
(1) a registration statement and prospectus on Form S-1
relating to up to 1,326,862 shares of the Company's
common stock that may be offered for sale by selling
stockholders. The selling stockholders may offer the
shares from time to time directly or, alternatively,
through underwriters, broker-dealers or agents. The
shares may be sold in one or more transactions at fixed
prices, at prevailing market prices at the time of sale,
at varying prices determined at the time of sale, or at a
negotiated price. The Company will not receive any
proceeds from the resale of the shares of common stock.
See http://ResearchArchives.com/t/s?445c
(2) a registration statement on Form S-8 to register
3,033,000 shares of common stock to be issued under the
GEORGIA GULF CORPORATION 2009 EQUITY AND PERFORMANCE
INCENTIVE PLAN. The proposed maximum offering price per
share is $27.01. The proposed maximum aggregate offering
price is $81,921,330.
See http://ResearchArchives.com/t/s?445b
On July 29, 2009, the Company consummated a private exchange of
its equity securities for roughly $736.0 million, or 92.0%, in
aggregate principal amount of our outstanding 7.125% senior notes,
9.5% senior notes, and 10.75% subordinated notes. An aggregate of
roughly 30.2 million shares of convertible preferred stock and
1.3 million shares of common stock were issued in exchange for the
tendered notes. In conjunction with the debt exchange, the
Company implemented a 1-for-25 reverse stock split, which reduced
the outstanding common shares, before the issuance of common
shares in the debt exchange, to roughly 1.4 million shares.
In connection with the exchange offers, the Company executed a
registration rights agreement pursuant to which it granted certain
registration rights to the selling stockholders. The Company
filed the registration statement on Form S-1 to comply with
certain of its obligations under the registration rights
agreement.
The Company's board of directors has approved, and recommended for
approval by its stockholders, an amendment to the Company's
charter to increase the number of shares of common stock to
100 million. Upon approval of the charter amendment, the shares
of convertible preferred stock issued in the exchange offers will
automatically convert into shares of the Company's common stock on
a one-for-one basis. The Company will then be obligated to file a
second registration statement to permit the resale of roughly
30.2 million shares of common stock issued upon conversion of the
convertible preferred stock and other shares of common stock
issued in the exchange offers and not included in the current
prospectus, in addition to the shares being offered.
The Board of Directors approved an Amendment, dated August 10,
2009, to the Amended and Restated Rights Agreement, dated as of
December 5, 2000, between the Company and Computershare Trust
Company, N.A., as successor rights agent. The Amendment provides
that no person or entity will become an "Acquiring Person" under
the terms of the Rights Agreement solely as a result of the
Company's recapitalization and related transactions that were
consummated July 29, 2009, including the offers to exchange the
Company's then-outstanding 7.125% Senior Notes due 2013, 9.5%
Senior Notes due 2014, and 10.75% Senior Subordinated Notes due
2016, for an aggregate of up to 32,050,000 shares of the Company's
convertible preferred stock and up to an aggregate of 1,430,000
shares of the Company's common stock, and including the issuance
of the convertible preferred stock and the issuance of the shares
of common stock issuable upon conversion of the convertible
preferred stock.
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.
At June 30, 2009, the Company's balance sheet showed total assets
of $1.62 billion and total $1.70 billion, resulting in a
stockholders' deficit of $85.46 million.
Georgia Gulf has said factors that gave rise to the substantial
doubt about the Company's ability to continue as a going concern
have been remediated. As of June 30, 2009, the Company is in
compliance with all required debt covenants.
In August 2009, Moody's Investors Service upgraded the Corporate
Family Rating of Georgia Gulf to B2 from Caa2 as a result of the
completion of the private debt-for-equity exchange offer and an
amendment to its credit facility that substantially improves the
company's liquidity. As reported by the Troubled Company Reporter
on September 7, 2009, Standard & Poor's Ratings Services raised
its ratings on Georgia Gulf, including its corporate credit rating
to 'B' from 'D'. The outlook is stable.
GEORGIA GULF: Special Stockholders' Meeting on September 17
-----------------------------------------------------------
A Special Meeting of Stockholders of Georgia Gulf Corporation will
be held in the W Hotel, Atlanta Perimeter, 111 Perimeter Center
West, in Atlanta, Georgia, on September 17, 2009 at 10:00 a.m.
local time, for these purposes:
(1) to consider and vote upon an amendment to the Company's
certificate of incorporation to increase the number of
authorized shares of common stock from 3 million to
100 million; and
(2) to consider and vote upon the 2009 equity and performance
incentive plan providing for the issuance of up to
3,033,000 shares of the Company's common stock.
The Board of Directors of the Company has fixed the close of
business on August 17, 2009, as the record date for the
determination of stockholders entitled to notice of and to vote at
the meeting.
A full-text copy of the Company's proxy statement is available at
no charge at http://ResearchArchives.com/t/s?445d
On September 3, 2009, the Company filed with the Securities and
Exchange Commission a Current Report on Form 8-K to update the
historical financial statements included in its Annual Report on
Form 10-K for the year ended December 31, 2008, as previously
amended, to (i) amend the report of its independent registered
public accounting firm and modify footnote 23 to the consolidated
financial statements to delete references to uncertainty about the
Company's ability to continue as a going concern and (ii) reflect
the 1-for-25 reverse stock split of the Company's common stock
effected July 28, 2009. All other information in the historical
financial statements, as previously amended, remains unchanged.
The Company also updated Item 6 Selected Financial Data included
in its Annual Report on Form 10-K to reflect the 1-for-25 reverse
stock split of common stock. This will permit the Company to
incorporate these financial statements by reference in future
filings with the SEC.
A full-text copy of the updated financial statements, financial
statement schedule and five year selected financial data, is
available at no charge at http://ResearchArchives.com/t/s?445e
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.
At June 30, 2009, the Company's balance sheet showed total assets
of $1.62 billion and total $1.70 billion, resulting in a
stockholders' deficit of $85.46 million.
Georgia Gulf has said factors that gave rise to the substantial
doubt about the Company's ability to continue as a going concern
have been remediated. As of June 30, 2009, the Company is in
compliance with all required debt covenants.
In August 2009, Moody's Investors Service upgraded the Corporate
Family Rating of Georgia Gulf to B2 from Caa2 as a result of the
completion of the private debt-for-equity exchange offer and an
amendment to its credit facility that substantially improves the
company's liquidity. As reported by the Troubled Company Reporter
on September 7, 2009, Standard & Poor's Ratings Services raised
its ratings on Georgia Gulf, including its corporate credit rating
to 'B' from 'D'. The outlook is stable.
GLOBAL CROSSING: UK Unit Has GBP210-Mil. Total Deficit at June 30
-----------------------------------------------------------------
Global Crossing Limited unveiled second quarter results for its
subsidiary, Global Crossing (UK) Telecommunications Limited.
As of June 30, 2009, GCUK had GBP302.1 million in total assets and
GBP513.1 in total liabilities and GBP210.9 in net liabilities.
As of June 30, 2009, GCUK had cash and cash equivalents of
GBP17 million compared with GBP33 million at March 31, 2009, and
GBP27 million at June 30, 2008. GCUK had accumulated deficit of
GBP242.7 million and total deficit of GBP210.9 million as of
June 30, 2009.
GCUK generated revenue of GBP77 million, a decrease of
GBP1 million or 2%, sequentially and a decrease of GBP3 million or
4% on a year-over-year basis. The sequential decrease in revenue
was primarily due to lower equipment sales compared to the
previous quarter. The year-over-year decrease in revenue was
primarily due to attrition from the Camelot contract, partially
offset by growth from other customers across the Company's
enterprise and carrier sales channels. For the six months ended
June 30, 2009, a year-over-year decline in revenue from the
Camelot relationship of GBP12 million was largely offset by
revenue growth from other customers across our enterprise and
carrier sales channels of GBP9 million.
Cost of revenue, which includes cost of access, technical real
estate, network and operations, third party maintenance and cost
of equipment sales, was GBP54 million for the quarter, compared
with GBP52 million in the prior quarter and GBP51 million in the
second quarter of 2008. The sequential increase was primarily due
to the impact of a GBP3 million retroactive real estate tax
assessment revision for the cumulative period of December 2006
through June 2009. The year-over-year increase was primarily due
to the real estate tax assessment.
Sales, general and administrative expenses were GBP10 million for
the quarter, an increase of GBP1 million from the prior quarter
and essentially flat on a year-over-year basis. The sequential
increase was primarily due to higher restructuring provisions for
real estate.
GCUK's Operating Income Before Depreciation and Amortization for
the second quarter was GBP12 million, compared with GBP17 million
in the first quarter of 2009 and GBP20 million in the second
quarter of 2008. The sequential decrease in OIBDA was primarily
due to lower gross margin from equipment sales, higher real estate
taxes and higher restructuring provisions for real estate. The
year-over-year decrease in OIBDA was due to lower revenue,
primarily due to the attrition of the Camelot contract, and higher
real estate taxes.
GCUK recorded net income of GBP10 million for the second quarter
of 2009, compared with a net loss of GBP2 million in the first
quarter of 2009 and net income of GBP1 million in the second
quarter of 2008. In addition to the variances, the increase in
net income was primarily due to foreign exchange gains on the
GCUK's U.S. dollar-denominated Senior Secured Notes in the second
quarter of 2009 as compared with the prior comparable quarters.
Net cash used in operating activities during the second quarter
totaled GBP12 million after operating working capital use of
GBP8 million pounds and interest paid of GBP16 million. GCUK's
cash and cash equivalents decreased by GBP16 million in the second
quarter, after purchases of property, plant and equipment of
GBP4 million and principal payments on finance leases and other
debt obligations of GBP2 million.
In accordance with the indenture governing the senior secured
notes, the company repurchased GBP7 million of the Senior Secured
Notes, excluding accrued interest, on May 29, 2009. To support
this debt repurchase and other working capital needs, GCUK
borrowed GBP10 million from GC Impsat during the quarter.
"Demand for our value-added products and services continue to be
robust despite a challenging economic and competitive
environment," said John Legere, Global Crossing's chief executive
officer. "We continue to see healthy levels of new orders and
good opportunities in the UK market as customers pursue
productivity gains and cost reductions through the deployment of
advanced IP-based networking solutions."
The results were prepared in accordance with International
Financial Reporting Standards and presented in U.S. Generally
Accepted Accounting Principles (U.S. GAAP) format.
A full-text copy of GCUK's earnings release is available at no
charge at http://ResearchArchives.com/t/s?444e
About Global Crossing (UK)
Global Crossing (UK) Telecommunications Limited provides a full
range of managed telecommunications services in a secure
environment ideally suited for IP-based business applications. The
company provides managed voice, data, Internet and e-commerce
solutions to a strong and established commercial customer base,
including more than 100 UK government departments, as well as
systems integrators, rail sector customers and major corporate
clients. In addition, GCUK provides carrier services to national
and international communications service providers.
About Global Crossing
Global Crossing Limited (NASDAQ: GLBC) is a leading global IP
solutions provider with the world's first integrated global IP-
based network. The company offers a full range of secure data,
voice, and video products to approximately 40 percent of the
Fortune 500, as well as to 700 carriers, mobile operators and
ISPs. It delivers services to nearly 700 cities in more than 60
countries and six continents around the globe.
As reported by the Troubled Company Reporter on August 7, 2009,
Global Crossing Ltd. reported $2.32 billion in total assets and
$2.61 billion in total liabilities, resulting in $28.5 million in
stockholders' deficit at June 30, 2009. Global Crossing's balance
sheet at June 30 also showed strained liquidity, with $749 million
in total current assets, including $268 million in cash and cash
equivalents, against $945 million in total current liabilities.
H&W MOTORS: Appellate Court Upholds Prison Sentence for Former CEO
------------------------------------------------------------------
thonline.com reports that Judge Bobby E. Shepherd of the 8th U.S.
Circuit Court of Appeals has upheld the prison sentence imposed
for bankruptcy fraud against Roger Waldner, the former H&W Motor
Express CEO who is in custody at the minimum-security Federal
Prison Camp in Duluth, Minnesota.
As reported by the TCR on July 9, 2008, a federal court in Cedar
Rapids, Iowa, sentenced Mr. Waldner to 10 years in prison after he
pleaded guilty to two counts of lying to creditors in H&W Motor
Express' Chapter 11 case. Prosecutors said that Mr. Waldner
transferred at least $1 million to his other companies before
placing H&W into bankruptcy.
According to thonline.com, Mr. Waldner argued that the 10-year
prison sentence and the court's order to pay more than
$1.7 million in restitution was unreasonable, because the district
court committed procedural error by enhancing sentencing
guidelines based on "unsupported factual findings."
H&W Motor Express is a privately held trucking company that filed
its Chapter 11 petition on June 12, 2002 (Bankr. N.D. Iowa Case
No. 02-02017).
HELLER EHRMAN: Court Directs Creditors & Shareholders to Mediation
------------------------------------------------------------------
Judge Dennis Montali of the U.S. Bankruptcy Court for the Northern
District of California, San Francisco Division, has ordered
creditors and shareholders of Heller Ehrman to engage in
mediation.
The official committee of unsecured creditors in Heller Ehrman's
case is seeking to recover money paid by the firm to partners or
shareholders prepetition. The creditors committee said in a
report that the firm by December of 2007, was using creditors'
funds to overpay shareholders instead of making timely payments to
its creditors and properly reserve funds for its operations. The
committee said that the firm paid its partners $9 million in 2007,
falsely labeling the distributions as "loans."
Judge Montali has scheduled conferences before a "settlement
judge" for October 30 and November 16. The Debtor, the creditors
committee will serve upon another and other parties a settlement
conference statement by September 22. The various groups
representing shareholders are to serve their settlement conference
statement by October 28. The statements will be confidential.
Parties in the case and their lawyers are:
-- Heller Ehrman (represented by Pachulski, Stang Ziehl Young
Jones LLP).
-- the Creditors Committee (represented by Felderstein
Fitzgerald Willoughby & Pascuzzi LLP).
-- Douglas and Paul Sugarman, former shareholders who retired
in early 2008 and received their capital who ten remained
at the firm until dissolution as salaried employees of
Heller (represented by Wendel, Rosen, Black & Dean LLP).
-- Approximately 50 lower-compensated former shareholders who
remained until after the firm voted to dissolve, including
junior and fixed-income shareholders (represented by
Friedman Dumas & Springwater LLP).
-- Approximately 18 more highly-compensated former
shareholders who withdrew prior to dissolution vote
(represented by Saul Ewing, LLP).
-- Approximately 18 former shareholders now working at Jones
Day (represented by Tobias S. Keller, Esq., at Jones Day).
-- Approximately 90 of the more highly-compensated former
shareholders, who remained until after the firm voted to
dissolve (represented by Klee, Tuchin, Bogdanoff & Stern
LLP)
-- Five former shareholders now working at Foley & Lardner
(represented by Victor A. Vilaplana, Esq., at Foley &
Lardner).
About Heller Ehrman
Headquartered in San Francisco, California, Heller Ehrman, LLP LP
-- http://www.hewm.com/-- was an international law firm of more
than 730 attorneys in 15 offices in the United States, Europe, and
Asia. The firm filed a voluntary petition under Chapter 11 of the
Bankruptcy Code on December 28, 2008 (Bankr. N.D. Calif. Case No.
08-32514). Members of the firm's dissolution committee led by
Peter J. Benvenutti approved a plan dated September 26, 2008, to
dissolve the firm.
The Hon. Dennis Montali presides over the case. John D. Fiero,
Esq., and Miriam Khatiblou, Esq., at Pachulski, Stang, Ziehl,
Young and Jones, represent the Debtors as counsel. Thomas A.
Willoughby, Esq., at Felderstein Fitzgerald Willoughby & Pascuzzi
LLP, represents the official committee of unsecured creditors of
the Debtor. The firm listed between $50 million and $100 million
each in assets and debts in its bankruptcy petition.
HOME INTERIORS: Creditors Settle with Highland Capital
------------------------------------------------------
The official committee of unsecured creditors for Home Interiors &
Gifts Inc. won approval from the Bankruptcy Court to settle claims
against secured lenders, including many that are funds managed by
Highland Capital Management LP, Bill Rochelle at Bloomberg News
reported.
Under the settlement, the insurance company providing coverage for
the directors and officers will pay $150,000 while the lenders
gave up their claims on lawsuit recoveries. As previously agreed,
the lenders carved out $2.2 million to cover professional fees
plus $1.4 million to pay expenses of winding down the case. Any
surplus will go to unsecured creditors.
The creditors committee may continue their suit against those
secured creditors who didn't settle.
About Home Interiors
Headquartered in Carrollton, Texas, Home Interiors & Gifts, Inc.
-- http://www.homeinteriors.com/-- manufactures, imports and
distributes indoor and outdoor home decorative accessories. It
was founded by Mary Crowley in 1957. Through its affiliates, the
Company has a significant presence in Mexico, Puerto Rico, and
Canada. Annual revenue in 2007 reached $300 million. When Mary
Crowley, died in 1986, her son, Don Carter continued the business
operation nearly debt-free. In a leveraged transaction in 1998,
private equity firm of Hicks, Muse, Tate, and Furst acquired 66%
of the parent company, which resulted in the imposition of more
than $500 million in debt on the Debtors. In the face of
decreased sales and increased debt load, bondholders canceled
their debts in February 2006 in exchange for receiving most of the
outstanding equity of the Debtors.
About 40% of the goods the Debtors sell are now acquired from
manufacturers in China. In the last decade, sales volume in the
U.S. has waned, but the Debtors reported that sales in Mexico and
Puerto Rico significantly increased.
The Company and six of its affiliates filed for Chapter 11
protection on April 29, 2008 (Bankr. N.D. Tex. Lead Case No.
08-31961). Andrew Jillson, Esq., Cameron Kinvig, Esq., Robert
McCormick, Esq., and Mike Massad, Esq., at Hunton & Williams, LLP,
represent the Debtors as counsel. Richard A. Lindenmuth
at Boulder International LLC, is designated as CRO. The U.S.
Trustee for Region 6 has appointed seven creditors to serve on an
official committee of unsecured creditors. Munsch Hardt Kopf &
Harr, PC, represents the Committee in these cases. Kurtzman
Carson Consultants LLC is the official noticing and balloting
agent. In its schedules, Home Interiors & Gifts, Inc., listed
$88,653,051 in total assets, and $510,451,698 in total
liabilities.
As reported in the Troubled Company Reporter on December 11, 2008,
the Court approved the appointment by the United States Trustee of
Dennis Faulkner as Chapter 11 trustee in the Debtors' bankruptcy
cases. Dennis Faulkner, of the accounting firm of Lain, Faulkner
& Co., P.C., is a member of the American Bankruptcy Institute and
the Association of Insolvency and Restructuring Advisors. Lain,
Faulkner & Co., P.C., is an accounting firm which specializes in
bankruptcy, litigation and business advisory services.
HSH DELAWARE: Sent to Chapter 7 Liquidation by Creditors
--------------------------------------------------------
Creditors with claims aggregating $27.8 million filed a petition
to send HSH Delaware LP to Chapter 7 liquidation (Bankr. D. Del.
Case No. 09-13145), Bloomberg News reported. Commerzbank AG,
Lloyds TSB Bank Plc, ABN Amro Bank NV, Calyon, Royal Bank of
Scotland Plc and Landsbanki Islands HF filed the involuntary
Chapter 7 petition.
IMAGINE ADOPTION: Could Emerge from Bankruptcy Next Month
---------------------------------------------------------
BDO Dunwoody, bankruptcy trustee of Imagine Adoption Agency, has
submitted a restructuring plan that could bring the agency out of
bankruptcy next month, The Canadian Press reports. According to
the report, a group of creditors named Families of Imagine
Adoption said the restructuring plan outlines the operating
structure, financial terms and monitoring parameters of the
proposed new agency.
On July 30, creditors voted unanimously to forgo their financial
claims and instead requested that the trustee work on developing a
plan to resurrect the agency, The Canadian Press said. The
creditors include as many as 400 families across Canada who had
paid thousands of dollars to adopt children from Ethiopia,
Ecuador, Zambia and Ghana.
"Every family will be required to sign a new retainer agreement,
to pay an additional C$4,000 in recovery fees, and once a new pay
schedule is created, to pay instalments of any outstanding agency
fees," the group stated in the release.
Operating as Imagine Adoption Agency, Kids Link International
Adoption Agency is a Christian Non-Profit International Adoption
Agency incorporated within the Province of Ontario, and fully
licensed by the Ontario Ministry of Children and Youth Services to
facilitate international adoptions for Canadian families.
Imagine Adoption filed for bankruptcy in Canada on July 14, 2009.
Imagine Adoption said it owed C$800,000 to 400 families and that
its assets of C$723,004 were C$363,000 less than its liabilities.
BDO Dunwoody Limited was appointed as trustee.
INTRAOP MEDICAL: June 30 Balance Sheet Upside-Down by $6.13 Mil.
----------------------------------------------------------------
Intraop Medical Corp.'s balance sheet at June 30, 2009, showed
total assets of $5,909,537 and total liabilities of $12,046,963,
resulting in a stockholders' deficit of $6,137,426.
For three months ended June 30, 2009, the Company posted a net
loss of $1,890,972 compared with a net loss of $1,917,510 for the
same period in 2008.
For nine months ended June 30, 2009, the Company posted a net loss
of $5,491,416 compared with a net loss of $6,165,106 for the same
period in 2008.
A full-text copy of the Company's Form 10-Q is available for free
at http://ResearchArchives.com/t/s?4458
Headquartered in Sunnyvale, California, Intraop Medical Corp.
(OTC BB: IOPM) -- http://www.intraopmedical.com/-- develops,
manufactures, markets, distributes and services Mobetron, a
proprietary mobile electron-beam cancer treatment system designed
for use in intraoperative electron-beam radiation therapy, or
IOERT.
Going Concern Doubt
PMB Helin Donovan LLP, in San Francisco, expressed substantial
doubt about Intraop Medical Corp.'s ability to continue as a going
concern after auditing the company's consolidated financial
statements for the fiscal years ended Sept. 30, 2008, and 2007.
The auditor noted that the Company incurred substantial net losses
and incurred substantial monetary liabilities in excess of
monetary assets over the past several years, and as of Sept. 30,
2008, had an accumulated deficit of $42,681,085.
IVOICE INC: June 30 Balance Sheet Upside-Down by $2.42 Million
--------------------------------------------------------------
iVoice Inc.'s balance sheet at June 30, 2009, showed total assets
of $2,960,284 and total liabilities of $5,388,259, resulting in a
stockholders' deficit of $2,427,975.
For six month ended June 30, 2009, the Company posted a net loss
of $704,523 compared with a net income of $805,401 for the same
period in 2008.
For three month ended June 30, 2009, the Company posted a net loss
of $356,097 compared with a net income of $1,548,422 for the same
period in 2008.
The Company said that there is substantial doubt about its ability
to continue as a going concern. The Company noted that it has
incurred substantial accumulated deficits, has an obligation to
deliver an indeterminable amount of common stock due on derivative
liabilities, and has completed the process of spinning out the
five operating subsidiaries. The Company added that the
recoverability of a major portion of the recorded asset is
dependent upon continued operations of the Company, which in turn,
is dependent upon the Company's ability to raise capital or
generate positive cash flow from operations.
A full-text copy of the Company's Form 10-Q is available for free
at http://ResearchArchives.com/t/s?4456
About iVoice Inc.
Based in Matawan, New Jersey, iVoice Inc. (OTC BB: IVOI) --
http://www.ivoice.com/-- does not have significant operations.
It intends to merge with an operating entity. Previously, the
company developed and marketed over the counter non-prescription
healthcare products.
The company has formed or acquired a variety of subsidiaries which
have then been spun off to shareholders via special dividends;
spin offs have included Trey Resources, iVoice Technology, Deep
Field Technology, and SpeechSwitch. iVoice's long term plan,
however, revolves around development and licensing of proprietary
speech enabled technologies and applications that it holds patents
for.
JEFFERSON COUNTY: Approves Forbearance on General Obligation Debt
-----------------------------------------------------------------
According to Kathleen Edwards at Bloomberg News, county
commissioners at Jefferson County, Alabama, voted to extend until
Oct. 30 forbearance agreements with JPMorgan Chase & Co. and
BayernLB on $105 million of floating-rate general obligation
bonds. Jefferson County faced a Sept. 15 deadline to make the
debt payment.
Jefferson County said last week it is in talks with Regions
Financial Corp. for a $25 million bridge loan. Bettye Fine
Collins, president of the county's governing commission, said the
loan would allow the county to bring back 1,000 employees placed
on administrative leave on Aug. 1.
About Jefferson County
Jefferson County has its seat in Birmingham, Alabama. It has a
population of 660,000. It ended its 2006 fiscal year with a
$42.6 million general fund balance, according to Standard &
Poor's. The Birmingham firm of Bradley Arant Rose & White,
represents Jefferson County. Porter, White & Co. in Birmingham is
the county's financial adviser. A bankruptcy by Jefferson County
stands to be the largest municipal bankruptcy in U.S. history. It
could beat the record of $1.7 billion, set by Orange County,
California in 1994.
As reported by the TCR on July 24, 2009, Moody's Investors Service
has affirmed the Caa3 rating and negative outlook on Jefferson
County's (Alabama) outstanding $3.2 billion sewer revenue bonds.
Moody's underlying Caa3 rating reflects the likelihood of eventual
repayment by the county of principal, irrespective of outside
enhancement through bond insurance. It does not reflect the
claims paying ability of Syncora, which is rated Ca and failed to
fulfill its obligation to make a July 1 Bank Bond principal
payment.
JOHN GEORGE: Files for Chapter 7 Bankruptcy in Seattle
------------------------------------------------------
John George, which ran for the council in the city of Blaine in
Whatcom County, Washington, sought bankruptcy protection under
Chapter 7 on August 18, according to reporting by the Zoe Fraley
at The Bellingham Herald.
The report relates that documents filed by Mr. George with the
Bankruptcy Court in Seattle, shows the Debtor owes more than
$600,000 to creditors, which include lawyers, banks, credit
services and printing and graphic arts services. Mr. George
expects there won't be any property available to the trustee to
pay creditors. At the time of filing, Mr. George had $250 cash
and about $30 in the bank, according to the documents. His
assets, including his home, car, furniture and a boat, are
estimated at $220,000.
KRONOS INT'L: Lenders Waive Compliance for August 31 Test Period
----------------------------------------------------------------
Kronos International, Inc., discloses that on August 31, 2009,
lenders under a revolving credit facility entered into by certain
of its operating subsidiaries, waived compliance with the required
financial ratio of the Borrowers' net secured debt to earnings
before income taxes, interest and depreciation under the loan
agreement for the 12-month period ending August 31, 2009. Among
other things, the waiver moved the next required Debt Ratio
measurement period to the 12-month period ending September 15,
2009. The Borrowers did not pay any fee to the Lenders to obtain
the waiver.
Certain operating subsidiaries of Kronos International, namely
Kronos Titan GmbH, Kronos Europe S.A./N.V., Kronos Titan AS,
Kronos Norge AS, Titania AS and Kronos Denmark ApS -- as Borrowers
-- are parties to a Facility Agreement dated June 25, 2002, as
most recently amended on May 26, 2008, with Deutsche Bank AG, as
mandated lead arranger, Deutsche Bank Luxembourg S.A., as agent,
and the lenders participating in the facility. The Amended
Revolving Credit Facility matures May 26, 2011. Borrowings under
the Amended Revolving Credit Facility bear interest at the
applicable interbank market rate plus 1.75%. The Amended
Revolving Credit Facility is collateralized by the accounts
receivable and the inventories of the Borrowers and a limited
pledge of all of the other assets of Kronos Europe S.A./N.V. The
Amended Revolving Credit Facility contains representations,
warranties and covenants customary in lending transactions of this
type.
John A. St. Wrba, Vice President and Assistant Treasurer of Kronos
International, said the Borrowers are continuing their discussions
with the Lenders to amend the terms of the Amended Revolving
Credit Facility and expect to obtain an amendment by September 15,
2009.
"[The Company] can give no assurance that such amendment will be
obtained on or around such date or later, or if obtained that the
requirement to maintain the Debt Ratio would be eliminated (or
waived, in the event the Lenders would only agree to a waiver and
not an amendment to eliminate the Debt Ratio covenant itself)
through some future date acceptable to the Borrowers. Any such
amendment or waiver that the Borrowers might obtain could increase
their future borrowing costs, either from a requirement that they
pay a higher rate of interest on outstanding borrowings and/or pay
a fee to the Lenders as part of agreeing to such amendment or
waiver," Mr. Wrba said.
"In the event the Borrowers are not successful in obtaining the
amendment or waiver of the Amended Revolving Credit Facility to
eliminate the requirement to comply with the Debt Ratio financial
covenant until some future date acceptable to the Borrowers, the
Borrowers would seek to refinance such facility with a new group
of lenders with terms that would not include the Debt Ratio
financial covenant or, if required, the Borrowers will use their
existing liquidity resources (which could include funds provided
by affiliates of the Borrowers). While there is no assurance that
the Borrowers would be able to refinance the Amended Revolving
Credit Facility with a new group of lenders, the [Company]
believes these other sources of liquidity available to the
Borrowers would allow them to refinance the Amended Revolving
Credit Facility. If required, the [Company] believes by
undertaking one or more of these steps the Borrowers will be
successful in maintaining sufficient liquidity to meet the
Company's future obligations including operations, capital
expenditures and debt service for the next 12 months," Mr. Wrba
said.
At June 30, 2009, Kronos International's consolidated debt was
comprised of:
-- EUR400 million principal amount of its 6.5% Senior Secured
Notes ($561.3 million at June 30, 2009) due in 2013;
-- EUR51.0 million ($71.8 million) under its revolving credit
facility which matures in May 2011; and
-- Roughly $6.7 million of other indebtedness.
On March 20, 2009 the Lenders waived compliance with the Debt
Ratio, for the 12-month period ending March 31, 2009. Among other
things, such waiver moved the next required Debt Ratio measurement
period to the 12-month period ending April 30, 2009. The
Borrowers did not pay any fee to the Lenders to obtain the waiver.
On April 29, 2009 the Lenders waived compliance with the Debt
Ratio for the 12-month period ending April 30, 2009. Among other
things, this waiver moved the next required Debt Ratio measurement
period to the 12-month period ending June 15, 2009. The Borrowers
also did not pay any fee to the Lenders to obtain the second
waiver.
On June 18, 2009, the Lenders waived compliance with the Debt
Ratio for the 12-month period ending June 15, 2009. Among other
things, this waiver moved the next required Debt Ratio measurement
period to the 12-month period ending August 31, 2009. The
Borrowers also did not pay any fee to the Lenders to obtain the
third waiver.
Q2 Financial Results
Kronos International swung to a net loss of $26.1 million for the
three months ended June 30, 2009, from a $12.9 million net income
for the same quarter in 2008. It posted a net loss of
$50.2 million for the first half of 2009, from net income of
$16.7 million for the first half of 2008.
Kronos explained its net income decreased in 2009 as compared to
the same periods of 2008 primarily due to the net effects of lower
income from operations in 2009 resulting principally from lower
sales and production volumes in the 2009 periods. In late 2008,
as a result of the decrease in global demand, the Company
experienced a build up in its inventory level. To decrease its
inventory levels and improve liquidity, the Company implemented
production curtailments. Through the curtailments the Company
successfully reduced inventory levels and increased liquidity,
although the resulting curtailments led to a net loss due to the
large amounts of unabsorbed fixed production costs charged to
expense as incurred.
The Company also noted its net income for the first six months of
2008 includes a second quarter income tax benefit of $7.2 million
related to a European Court ruling that resulted in the favorable
resolution of certain income tax issues in Germany.
As of June 30, 2009, the Company had total assets of
$1.028 billion against total current liabilities of $221.0 million
and total noncurrent liabilities of $716.8 million, resulting in
stockholder's equity of $90.6 million.
Kronos International Inc. is a wholly owned subsidiary of Kronos
Worldwide, Inc. The Company is a global producer and marketer of
value-added titanium dioxide pigments -- TiO2 -- which is used for
a variety of manufacturing applications, including plastics,
paints, paper and other industrial products. For the six months
ended June 30, 2009, approximately three-fourths of the Company's
sales volumes were into European markets. The Company believes it
is the second largest producer of TiO2 in Europe with an estimated
19% share of European TiO2 sales volumes. Its production
facilities are located throughout Europe.
LANDAMERICA FIN'L: Court OKs $10MM in Fees of Willkie Farr, et al.
------------------------------------------------------------------
The Bankruptcy Court has granted the first interim applications of
professionals retained in LandAmerica Financial Group Inc.'s
bankruptcy cases for the allowance of their fees and expenses
incurred from November through February 2009, pursuant to Sections
330 and 331 of the Bankruptcy Code. The allowed fees total
approximately $10,000,000 and the allowed expenses total
approximately $430,000.
A. Debtors' Professionals
Professional Period Fees Expenses
------------ --------- ---------- --------
Willkie Farr & 11/12/08- $4,062,498 $129,170
Gallagher LLP 02/28/09
McGuireWoods LLP 11/12/08- 2,779,708 83,225
02/28/09
Williams, Mullen, 11/26/08- 193,618 4,298
Clark & Dobbins, 02/28/09
P.C.
B. Official Committee of Unsecured Creditors' Professionals
Professional Period Fees Expenses
------------ -------- --------- --------
Bingham McCutchen 12/03/08- 1,796,844 50,017
LLP 02/28/09
Akin Gump Strauss 12/08/08- 1,471,879 90,672
Hauer & Feld LLP 02/28/09
Alvarez & Marsal 12/04/09- 764,029 30,685
North America, LLC 02/28/09
and Alvarez &
Marsal Dispute
Analysis &Forensic
Services, LLC
LeClairRyan, A 12/04/08- 536,431 11,833
Professional 02/28/09
Corporation
Protiviti Inc. 12/12/08- 383,207 26,589
02/28/09
Tavenner & Beran, 12/08/08- 94,128 3,576
PLC 02/28/09
The Court has also granted the second interim applications of
professionals retained in the Debtors' bankruptcy cases for the
allowance of their fees and expenses incurred from March through
May 2009. The allowed fees total about $11,000,000 and the
allowed expenses total about $440,000.
A. Debtors
Professional Period Fees Expenses
------------ --------- ---------- --------
Willkie Farr & 03/01/09- $3,467,779 $136,347
Gallagher LLP 05/31/09
McGuireWoods LLP 03/01/09- 3,016,393 33,197
05/31/09
Williams, Mullen, 03/01/09- 75,014 234
Clark & Dobbins, 05/31/09
P.C.
The Debtors are authorized and directed to pay Willkie Farr as
soon as practicable all fees and expenses approved by the Fee
Order, including the 15% holdback of $520,166 that remain
unpaid.
B. Official Committee of Unsecured Creditors
Professional Period Fees Expenses
------------ -------- --------- --------
Bingham McCutchen 03/01/09- $1,572,479 $60,277
LLP 05/31/09
Akin Gump Strauss 03/01/09- 1,188,704 90,837
Hauer & Feld LLP 05/31/09
Alvarez & Marsal 03/01/09- 922,769 56,847
North America, LLC 05/31/09
and Alvarez &
Marsal Dispute
Analysis &Forensic
Services, LLC
LeClairRyan, A 03/01/09- 471,456 26,447
Professional 05/31/09
Corporation
Protiviti Inc. 03/01/09- 499,924 36,523
05/31/09
Tavenner & Beran, 03/01/09- 76,594 2,557
PLC 05/31/09
C. Type A Test Case Plaintiff
Professional Period Fees Expenses
------------ -------- --------- --------
Anders Minkler & 02/17/09- $30,649 $703
Deihl, LLP 03/11/09
Prior to the entry of the Court's order, more than 30 creditors
of Debtor LandAmerica 1031 Exchange Services Inc. sent written
objections to Court, alleging that the amount fees and expenses
requested by the professionals could exceed 50% of the cash that
was in the commingled bank account when the Chapter 11 cases was
filed. The Objectors, who asserted that the requested fees are
excessive, are:
* David Chen and DCRE Investments, LLC
* Prudential Properties, LLC
* Rosanna Passantino
* Vivian Hays
* Sharon Billedeau
* Mahendra Patez
* John R, Corrado
* Glenn Eineman
* Marci Strange
* Danny J. McDaniel
* Donna Le
* James Wallace
* John R. Corrado
* Tracy A. Ralphs
* Gerald E. Dean
* Michael Bellmont
* Kevin Miller
* Kyoungue Kim
* Robert B. Ritchie
* Denise J. Wilson
* Roy Tanaka
* Michael Bellmont
* Kurt L. Wallach
* Danny J. McDaniel
* Daniel L. Thelen
* Venus Develpoment
* Marci Strange
* One unknown creditor
* Howard D. Reenders
* Dennis H. Reenders
* Scott A. Reenders
* Shirley A. Woodruff
About LandAmerica Financial
LandAmerica Financial Group, Inc., provides real estate
transaction services with offices nationwide and a vast network of
active agents. LandAmerica and its affiliates operate through
approximately 700 offices and a network of more than 10,000 active
agents throughout the world, including Mexico, Canada, the
Caribbean, Latin America, Europe, and Asia.
LandAmerica Financial Group and its affiliate LandAmerica 1031
Exchange Services, Inc. filed for Chapter 11 protection Nov. 26,
2008 (Bankr. E.D. Va. Lead Case No. 08-35994). Dion W. Hayes,
Esq., and John H. Maddock III, Esq., at McGuireWoods LLP, are the
Debtors' bankruptcy counsel. In its bankruptcy petition, LFG
listed total assets of $3,325,100,000, and total debts of
$2,839,800,000 as of Sept. 30, 2008.
On March 6, 2009, affiliate LandAmerica Assessment Corporation,
aka National Assessment Corporation, filed its own petition for
Chapter 11 relief. Affiliate LandAmerica Title Company filed for
for Chapter 11 relief on March 27, 2009.
LandAmerica Credit Services, Inc., filed for Chapter 11 in July
2009.
Bankruptcy Creditors' Service, Inc., publishes LandAmerica
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by LandAmerica Financial and its affiliate LandAmerica
1031 Exchange Services, Inc. (http://bankrupt.com/newsstand/or
215/945-7000)
LANDAMERICA FIN'L: LTC's Schedules of Assets & Debts
----------------------------------------------------
A. Real Property None
B. Personal Property
B.1 Cash on hand None
B.2 Bank Accounts
Bank of America Business Checking - 5833 $943,618
Statutory Certificates of Deposit
California United Bank - 0112 100,000
Comerica Bank - 1641 60,000
Comerica Bank - 1179 22,500
Bank of America - 4277 22,500
Bank of America - 0400 7,500
Bank of America - 1997 7,500
Bank of America - 5455 7,500
Bank of America - 5463 7,500
Bank of America - 5479 7,500
B.3 Security Deposits
The Realty Associates Fund III L.P. 21,833
NBB Associates, L.P. 17,499
CarrAmerica Development, Inc. 12,209
Hyundai Rio Vista 8,116
Bouris Living Revocable Trust 6,729
Daum Commercial Real Estate Services 4,316
Seacliff Partners, LLC 2,962
Sun Lakes Realty 2,500
Kehoe Family Trust 2,112
B.9 Interests in Insurance Policies None
B.12 Interests in IRA, ERISA or other Pension Plans None
B.13 Business Interests and stocks
All Counites Courier, Inc. Unknown
Joint Title Plan of Santa Clara County, LLC 300,000
B.14 Interests in partnerships None
B.16 Accounts Receivable, net of reserves 416,394
B.18 Other Liquidated Debts None
B.20 Contingent and noncontingent interest None
B.21 Other Contingent & Unliquidated Claims None
B.22 Patents None
B.23 General Intangibles None
B.24 Customer lists None
B.25 Vehicles None
B.27 Aircraft and accessories None
B.28 Office equipment, furnishings and supplies
Office Equipment 228,833
Data Processing Equipment 174,356
Leasehold Improvements 37,715
B.29 Machinery None
B.30 Inventory None
B.35 Other Personal Property
Capital Title Group Indemnity Escrow 50,000
Prepaid Rent 27,007
Prepaid Expenses 7,285
Prepaid Leased Equipment 180
TOTAL SCHEDULED ASSETS $2,506,169
======================================================
C. Property Claimed as Exempt None
D. Secured Claim None
E. Unsecured Priority Claims None
F. Unsecured Non-priority Claims
See: http://ResearchArchives.com/t/s?42f3 $67,152
TOTAL SCHEDULED LIABILITIES $67,152
======================================================
About LandAmerica Financial
LandAmerica Financial Group, Inc., provides real estate
transaction services with offices nationwide and a vast network of
active agents. LandAmerica and its affiliates operate through
approximately 700 offices and a network of more than 10,000 active
agents throughout the world, including Mexico, Canada, the
Caribbean, Latin America, Europe, and Asia.
LandAmerica Financial Group and its affiliate LandAmerica 1031
Exchange Services, Inc. filed for Chapter 11 protection Nov. 26,
2008 (Bankr. E.D. Va. Lead Case No. 08-35994). Dion W. Hayes,
Esq., and John H. Maddock III, Esq., at McGuireWoods LLP, are the
Debtors' bankruptcy counsel. In its bankruptcy petition, LFG
listed total assets of $3,325,100,000, and total debts of
$2,839,800,000 as of Sept. 30, 2008.
On March 6, 2009, affiliate LandAmerica Assessment Corporation,
aka National Assessment Corporation, filed its own petition for
Chapter 11 relief. Affiliate LandAmerica Title Company filed for
for Chapter 11 relief on March 27, 2009.
LandAmerica Credit Services, Inc., filed for Chapter 11 in July
2009.
Bankruptcy Creditors' Service, Inc., publishes LandAmerica
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by LandAmerica Financial and its affiliate LandAmerica
1031 Exchange Services, Inc. (http://bankrupt.com/newsstand/or
215/945-7000)
LANDAMERICA FIN'L: LTC's Statement of Financial Affairs
-------------------------------------------------------
G. William Evans, president and chief financial officer of
LandAmerica Title Company, reported that the company has gained
$18,693,337 from its business operations during the two years
before the Petition Date:
Period Amount
------ ------------
January 2009 to May 11, 2009 ($240,194)
Fiscal Year 2008 (3,385,808)
Fiscal Year 2007 (10,067,335)
LTC paid or transferred to creditors certain amounts within 90
days immediately before the Petition Date, a list of which is
available for free at http://bankrupt.com/misc/LTC_SOFAs_3b.pdf
LTC also made payments, totaling $141,907, to "insiders" as
defined under Section 101(31) of the Bankruptcy Code within one
year immediately preceding the Petition Date for the benefit of
creditors who are insiders. A list of the insider transfers is
available for free at http://bankrupt.com/misc/LTC_SOFAs_3c.pdf
Within a year immediately before the Petition Date, LTC is a
party to a lawsuit captioned Interbusiness Bank v. U.M.I. Tech.,
et al., Case No. 05CC09251, as filed in the Orange County
Superior Court. The Lawsuit relates to a judicial foreclosure
and has been settled.
LTC gave Robert Payne $100 as a gift to within one year
immediately preceding the Petition Date. Mr. Payne is an
employee of LTC.
Within six years immediately the Petition Date, LTC is a member
of the consolidated tax group under parent company, LandAmerica
Financial Group, with Tax Identification No. 54-1589611.
County Title Holding Corp. owns 100% of LTC's common stocks.
About LandAmerica Financial
LandAmerica Financial Group, Inc., provides real estate
transaction services with offices nationwide and a vast network of
active agents. LandAmerica and its affiliates operate through
approximately 700 offices and a network of more than 10,000 active
agents throughout the world, including Mexico, Canada, the
Caribbean, Latin America, Europe, and Asia.
LandAmerica Financial Group and its affiliate LandAmerica 1031
Exchange Services, Inc. filed for Chapter 11 protection Nov. 26,
2008 (Bankr. E.D. Va. Lead Case No. 08-35994). Dion W. Hayes,
Esq., and John H. Maddock III, Esq., at McGuireWoods LLP, are the
Debtors' bankruptcy counsel. In its bankruptcy petition, LFG
listed total assets of $3,325,100,000, and total debts of
$2,839,800,000 as of Sept. 30, 2008.
On March 6, 2009, affiliate LandAmerica Assessment Corporation,
aka National Assessment Corporation, filed its own petition for
Chapter 11 relief. Affiliate LandAmerica Title Company filed for
for Chapter 11 relief on March 27, 2009.
LandAmerica Credit Services, Inc., filed for Chapter 11 in July
2009.
Bankruptcy Creditors' Service, Inc., publishes LandAmerica
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by LandAmerica Financial and its affiliate LandAmerica
1031 Exchange Services, Inc. (http://bankrupt.com/newsstand/or
215/945-7000)
LEE ENTERPRISES: Again Meets NYSE Listing Standard
--------------------------------------------------
Lee Enterprises, Incorporated said September 8 it has returned to
compliance with requirements for continued listing on the New York
Stock Exchange.
In a letter dated Sept. 4, the NYSE notified Lee that its share
price has risen to a sufficient level to cure a share price
deficiency. The NYSE had notified Lee in December 2008 that the
company was not in compliance with the NYSE's continued listing
standard that requires an average closing price of at least $1.00
per share of its publicly traded common shares over a 30-trading
day period. At the time, the exchange rules granted the company a
six-month period within which to cure the price deficiency. Since
then, the NYSE temporarily suspended the standard through July 31,
2009, and, as a result, extended Lee's six-month cure period until
Dec. 3, 2009.
Mary Junck, Lee chairman and chief executive officer, said, "As we
have noted previously, we believe the long-term prospects for our
company remain strong and will become increasingly apparent to
investors as the recession begins to recede. Our newspapers and
online sites continue to reach the vast majority of adults in our
markets, far more than any competitor, and we continue to stand
out as the leading provider of local news, information and
advertising in our markets."
Lee Enterprises -- http://www.lee.net/-- operates 53 daily
newspapers, online sites and more than 300 specialty publications
in 23 states. Lee's newspapers have circulation of 1.5 million
daily and 1.8 million Sunday, reaching four million readers daily.
Lee's online sites attract 14 million unique visits monthly, and
Lee's weekly publications have distribution of more than four
million households. Lee's markets include St. Louis, Mo.; Lincoln,
Neb.; Madison, Wis.; Davenport, Iowa; Billings, Mont.;
Bloomington, Ill.; and Tucson, Ariz. Lee stock is traded on the
New York Stock Exchange under the symbol LEE.
LEHMAN BROTHERS: LBI TRUSTEE Proposes SHG as Israeli Counsel
------------------------------------------------------------
James Giddens, trustee for the liquidation of Lehman Brothers
Inc., seeks the Court's authority to employ Steinmetz Haring
Gurman & Co. as his special Israeli counsel effective as of
August 13, 2009.
Mr. Giddens has tapped the firm to represent LBI's estate before
the District Court for Tel Aviv-Jaffa in a case filed by the
Israel Discount Bank against LBI and other Lehman units within
the framework of a lawsuit previously commenced by Bank Leumi
against the Lehman units. SHG is also tasked to assist the
trustee in the recovery of LBI's customer property in Israel,
among other things.
Mr. Giddens proposes to pay SHG of its services on an hourly
basis and reimburse the firm of its expenses. Opher Levenberg,
Esq., and Eli Shimlovitch, Esq., who were designated to provide
legal assistance, will be paid $350 and $300, respectively. The
firm's associates who are also expected to provide the services
will be paid an hourly rate of $120 to $200, while the legal
assistants will be paid $80 per hour.
Mr. Levenberg, a partner at SHG, assures the Court that his firm
does not have any connection with LBI and does not have interest
adverse to its creditors and stockholders.
About Lehman Brothers
Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the
fourth largest investment bank in the United States. For more
than 150 years, Lehman Brothers has been a leader in the global
financial markets by serving the financial needs of corporations,
governmental units, institutional clients and individuals
worldwide.
Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition
listed $639 billion in assets and $613 billion in debts,
effectively making the firm's bankruptcy filing the largest in
U.S. history. Several other affiliates followed thereafter.
The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil,
Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the
U.S. District Court for the Southern District of New York, entered
an order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI
The Bankruptcy Court has approved Barclays Bank Plc's purchase of
Lehman Brothers' North American investment banking and capital
markets operations and supporting infrastructure for
US$1.75 billion. Nomura Holdings Inc., the largest brokerage
house in Japan, purchased LBHI's operations in Europe for $2
dollars plus the retention of most of employees. Nomura also
bought Lehman's operations in the Asia Pacific for US$225 million.
International Operations Collapse
Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, was placed into administration,
together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE
Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to Lehman Brothers International
(Europe) on September 15, 2008. The joint administrators have
been appointed to wind down the business.
Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc.
filed for bankruptcy in the Tokyo District Court on September 16.
Lehman Brothers Japan Inc. reported about JPY3.4 trillion
(US$33 billion) in liabilities in its petition.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and its various
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
LEHMAN BROTHERS: LBI Trustee Proposes Menaker as Special Counsel
----------------------------------------------------------------
James Giddens, trustee for the liquidation of Lehman Brothers
Inc., seeks court approval to employ Menaker & Herrmann LLP as
his special counsel effective as of July 30, 2009.
Mr. Giddens selected the firm because of its extensive experience
and knowledge in the fields of bankruptcy, securities law and
complex commercial litigation as well as other areas of the law
where the trustee may need legal advice.
As special counsel, Menaker & Herrmann is tasked to advise the
trustee on potential settlement agreements, compromise of claims,
transactions and other matters requested by the trustee or his
lead counsel Hughes Hubbard & Reed LLP.
Menaker & Herrmann will be paid of its services on an hourly
basis and will be reimbursed of its expenses. Mr. Giddens
proposes to pay $270 to $400 for the firm's partners, $162 to
$225 for associates, and $99 for legal assistants.
Robert Herrmann, Esq., at Menaker & Herrmann assured the Court
that his firm does not have any connection with LBI and does not
have interest adverse to its creditors and stockholders.
About Lehman Brothers
Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the
fourth largest investment bank in the United States. For more
than 150 years, Lehman Brothers has been a leader in the global
financial markets by serving the financial needs of corporations,
governmental units, institutional clients and individuals
worldwide.
Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition
listed $639 billion in assets and $613 billion in debts,
effectively making the firm's bankruptcy filing the largest in
U.S. history. Several other affiliates followed thereafter.
The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil,
Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the
U.S. District Court for the Southern District of New York, entered
an order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI
The Bankruptcy Court has approved Barclays Bank Plc's purchase of
Lehman Brothers' North American investment banking and capital
markets operations and supporting infrastructure for
US$1.75 billion. Nomura Holdings Inc., the largest brokerage
house in Japan, purchased LBHI's operations in Europe for $2
dollars plus the retention of most of employees. Nomura also
bought Lehman's operations in the Asia Pacific for US$225 million.
International Operations Collapse
Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, was placed into administration,
together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE
Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to Lehman Brothers International
(Europe) on September 15, 2008. The joint administrators have
been appointed to wind down the business.
Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc.
filed for bankruptcy in the Tokyo District Court on September 16.
Lehman Brothers Japan Inc. reported about JPY3.4 trillion
(US$33 billion) in liabilities in its petition.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and its various
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
LEVERAGE GROUP: Founder Faces SEC Charges for Ponzi Scheme
----------------------------------------------------------
The Securities and Exchange Commission on Tuesday charged a
Brooklyn money manager for running a $40 million Ponzi scheme in
which he promised roughly 800 investors guaranteed high returns
from safe, liquid investments, but instead spent their money on
real estate, his pornography mail order business, and other
interests.
The SEC alleges that Philip G. Barry and his firms Leverage Group,
Leverage Option Management Co., Inc., and North American Financial
Services defrauded investors, including senior citizens and
retirees, by selling securities in Leverage investment funds.
According to the Commission's complaint, Mr. Barry provided fake
account statements to investors that recorded growing account
balances and concealed that Mr. Barry had not been trading
securities at all for several years. Neither Mr. Barry nor any of
his related firms is registered with the SEC in any capacity.
"Barry was an unscrupulous and unregulated investment manager who
lured victims with false promises of investment safety, lofty
performance, and liquidity," said George S. Canellos, Director of
the SEC's New York Regional Office. "While Barry guaranteed
investors high returns and provided them with false account
balances, he was secretly diverting the funds into unauthorized
ventures and for his personal use."
The SEC alleges that Mr. Barry and his firms made numerous and
varied misrepresentations to induce investors to invest in or to
maintain their investments with the Leverage investment funds.
For example, Mr. Barry falsely represented that he would use the
investors' funds to trade in options or other securities. In
addition, Mr. Barry falsely told investors that he would use a
proven trading strategy to protect investors' principal and
generate guaranteed returns of as much as 21 percent per year. As
alleged in the complaint, these purportedly guaranteed rates of
return were simply numbers arbitrarily selected by Mr. Barry. Mr.
Barry also misrepresented to some investors that their investments
in Leverage would be protected from loss by privately obtained
insurance or by the Securities Investors Protection Corporation.
Mr. Barry told investors that they could liquidate their
investment at any time and withdraw their funds, after providing
Leverage with a few weeks notice.
The SEC's complaint, filed in the U.S. District Court for the
Eastern District of New York, alleges that, by approximately 1999,
Mr. Barry had ceased investing any of his investors' funds in
options or other securities. Instead, the Commission alleges that
Mr. Barry ran a Ponzi scheme in which he used incoming investor
money to repay other existing investors and diverted the remaining
investor funds for his own personal use. According to the
Commission's complaint, Mr. Barry spent the money by purchasing
real estate in his own name and those of other entities he
controlled, paying expenses of a separate mail order business that
sold pornographic materials, and supporting his lifestyle.
The SEC's complaint charges Mr. Barry, Leverage Group, Leverage
Option Management Co., Inc, and North American Financial Services
with violating Section 17(a) of the Securities Act of 1933,
Section 10(b) and Rule 10b-5 of the Securities Exchange Act of
1934, and Sections 206(1), 206(2), 206(4) and Rule 206(4)-8 of the
Investment Advisers Act of 1940. The complaint seeks permanent
injunctions, disgorgement of ill-gotten gains plus prejudgment
interest, and financial penalties against all defendants.
Without admitting or denying the allegations in the complaint, Mr.
Barry, Leverage Group, Leverage Option Management Co., Inc, and
North American Financial Services agreed to settle the SEC's
claims against them and consented to the entry of a judgment,
subject to approval by the court, that enjoins them from future
violations of the above provisions of the securities laws and
orders them to pay disgorgement, prejudgment interest and a civil
penalty, the amounts of which will be determined at a later date.
Mr. Barry also has consented to the issuance of a Commission order
barring him from association with an investment adviser.
Separately, the U.S. Attorney's Office for the Eastern District of
New York announced criminal charges against Mr. Barry for the same
misconduct alleged in the SEC's complaint.
The Commission acknowledges the assistance and cooperation of the
USAO and the Federal Bureau of Investigation in this matter.
LYONDELL CHEMICAL: Gets 45-Day Extension for Noteholder Bar
-----------------------------------------------------------
Lyondell Chemical Co. and its affiliates sought a preliminary and
permanent injunction pursuant to Section 105(a) of the Bankruptcy
Code, Rule 65 of the Federal Rules of Civil Procedure, and Rules
7001(7) and 7065 of the Federal Rules of Bankruptcy Procedure
against Wilmington Trust Company, as indenture trustee under the
$615,000,000 and EUR500,000,000 8.375% senior notes due August 15,
2015 guaranteed by non-debtor affiliates of the Debtors.
The Debtors asked the Court for a preliminary injunction enjoining
until at least January 31, 2010, Wilmington Trust from attempting
to enforce any rights or exercise any remedy against the Non-
Debtor Guarantors. The Debtors also filed with the Court a
request seeking permanent injunction enjoining Wilmington Trust
until January 31, 2010.
At the September 8 hearing, Judge Robert Gerber gave a 45-day
extension of the order barring Noteholders from taking any action,
after an agreement that a hearing will be held to resolve the
issue. Judge Gerber scheduled an October 13 hearing.
On December 20, 2007, LBI, certain of its subsidiaries, and
certain lenders entered into a Senior Secured Loan and Bridge
Loan under which LBI incurred $20 billion of secured debt. The
parties to the Loans and Wilmington Trust subsequently entered
into an Intercreditor Agreement, which provides for a standstill
period wherein the acceleration of the payment obligations of LBI
and the Guarantors and any action to enforce claims against LBI
or the Guarantors under the 2015 Notes is prohibited. The
current principal aggregate amount of the 2015 Notes upon
acceleration is EUR500 million and $615 million, plus accrued
interests.
On March 23, 2009, Citibank, N.A., as Senior Agent, Security
Agent and ABL Agent, and Merrill Lynch Capital Corporation, as
Interim Facility Agent, received from Wilmington Trust a High
Yield Notes Default Notice. Under the March 23rd Default Notice,
the Standstill Period is set to expire on September 18, 2009.
Wilmington Trust also sent a letter on May 15, 2009, to Citibank
and Merrill Lynch stating that an Event of Default has occurred
under the 2015 Indenture due to the bankruptcy filing of LBI. On
May 21, 2009, Debtor LBI and the Non-Debtors Guarantors received
from Wilmington Trust a demand for the Non-Debtor-Guarantors'
immediate payment to Wilmington Trust of all obligations under
the Indenture for the benefit of the 2015 Noteholders.
Moreover, under a European Securitization Program, lenders
provide funding to European non-debtor affiliates and Basell
Polyolefins Collections Limited, a bankruptcy-remote affiliate of
the Debtors. Under the European Securitization Program, a
Standstill Event was to occur on a Settlement Date occurring
prior to the 149th day of the Standstill Period in connection
with the 2015 Notes. The lenders have agreed to waive the
Termination Event until September 9, 2009.
Vineet Bhatia, Esq., at Susman Godfrey LLP, in Houston, Texas,
asserts that the Non-Debtor-Guarantors do not have unencumbered
assets sufficient to satisfy the 2015 Notes guaranties. He
further asserts that upon occurrence of a Termination Event, a
EUR171 million funding would no longer be immediately available
to the European Non-Debtor Affiliates after the Standstill Event,
and the Non-Debtor Affiliates would thus have to obtain these
amounts from new sources of financing. The DIP Credit Facility
has a EUR700,000,000 limit on the amount of cash the U.S. can
send to the Non-Debtor Affiliates at any one time outstanding
under an intercompany loan facility. Given current outstanding
borrowings, anticipated future cash flow budgets and the loss of
funding under the European Securitization Program, by the end of
October the Non-Debtor Affiliates will not have adequate
availability under the DIP Facility to continue operations if the
European Securitization Program is not available, he stresses.
Whether the Non-Debtor Affiliates face insolvency because of a
DIP default, the pursuit of guarantee claims or as a result of a
Standstill Event or Termination Event under the European
Securitization Program, the consequences would be disastrous, Mr.
Bhatia emphasizes. Insolvency proceedings in Europe generally
often lead to the liquidation of the insolvent entity and result
in management being replaced by a "receiver" or "trustee"
appointed by a court. The resulting loss of Debtor control over
these entities would make it virtually impossible to coordinate
each of those disparate proceedings with the proceedings before
the Bankruptcy Court, he asserts.
Mr. Bhatia further informs the Court that the Debtors have made
substantial progress in their reorganization as required by their
DIP Financing's milestones. Specifically, on August 14, 2009,
the Debtors delivered a draft plan of reorganization and
disclosure statement to the DIP Lenders and all other major
constituencies, including the Official Committee of Unsecured
Creditors. The Debtors' plan of reorganization will distribute
to creditors all of the enterprise value of LyondellBasell,
including the value of the Debtors' Non-Debtor Affiliates in
Europe. The Debtors expect to meet the additional DIP Financing
milestones by filing the plan of reorganization and disclosure
statement with the Court by September 15, 2009, and confirming a
plan by the end of January 2010.
Against this backdrop, Mr. Bhatia asserts that the Debtors are
entitled to a preliminary injunction under Section 105(a) to
enjoin any attempts to enforce any rights or exercise any
remedies under the 2015 Notes against the Non-Debtor-Guarantors.
He maintains that the exercise of those remedies will precipitate
a Termination Event under the European Securitization Program, an
Event of Default under the DIP Facility, and a potential
liquidation of the Debtors. Claims against any of the Non-Debtor
Guarantors would implicate the Debtors because certain of the
Debtors are Guarantors of the 2015 Notes and that defending those
claims would impose burdens on the Debtors' employees and senior
management, he continues. In contrast, the 2015 Noteholders
would not be harmed at all by injunctive relief because the
claims of the 2015 Notes are contractually subordinated to the
Debtors' senior debt, and any payment received on the 2015 Notes
would be subject to turnover for the benefit of the more senior
lenders, he asserts.
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. On January 6, 2009,
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 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 US$8 billion in DIP financing
to fund continuing operations. The DIP financing includes two
credit agreements: a US$6.5 billion term loan, which comprises a
US$3.25 billion in new loans and a US$3.25 billion roll-up of
existing loans; and a US$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: Parent Restarts Two French Refinery Units
------------------------------------------------------------
Tara Patel at Bloomberg News reports that LyondellBasell
Industries is restarting two units at its Berre refinery in
southern France following technical glitches that led to shutdowns
last week. Closure of the fluid catalytic cracker and crude
distillation units occurred Sept. 4 for "technical issues,"
Isabelle Merle-Aguesse, a spokeswoman at Compagnie Petrochimiqu de
Berre, a unit of LyondellBasell, said.
The refinery has a capacity of 6.3 million tons of oil a year,
according to the Web site of the Union Francaise des Industries
Petrolieres, or UFIP, an industry group. The plant is located
near the Fos oil import terminal.
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. On January 6, 2009,
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 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 US$8 billion in DIP financing
to fund continuing operations. The DIP financing includes two
credit agreements: a US$6.5 billion term loan, which comprises a
US$3.25 billion in new loans and a US$3.25 billion roll-up of
existing loans; and a US$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: MIP Payments to Sued Officers Placed in Escrow
-----------------------------------------------------------------
All payments under the Management Incentive Program to Edward J.
Dineen; C. Bart de Jong; James W. Bayer; and Michael P.
Mulrooney, directors and officers of the Debtors and defendants
in the action commenced by the Official Committee of Unsecured
Creditors against the Debtors' secured lenders and officers, will
be held in escrow pending further Court approval, Judge Robert
Gerber held.
Judge Gerber also confirmed that $45 million is the maximum
amount payable with respect to the MIP for 2009. Judge Gerber
noted that the Debtors will not amend the MIP without consent of
the Ad Hoc Committee of Senior Secured Lenders, the DIP Lenders
and the Creditors Committee, unless amendments are ministerial
changes. In addition, the maximum amounts payable by the Debtors
under the:
* Retention Plan is $15 million;
* Discretionary Bonus Plan is $1 million; and
* Hardship Plan is $2 million.
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. On January 6, 2009,
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 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 US$8 billion in DIP financing
to fund continuing operations. The DIP financing includes two
credit agreements: a US$6.5 billion term loan, which comprises a
US$3.25 billion in new loans and a US$3.25 billion roll-up of
existing loans; and a US$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: Opposes Sec. 502(e) Environmental Claims
-----------------------------------------------------------
Pursuant to Section 502(e)(1)(B) of the Bankruptcy Code, Lyondell
Chemical Co. and its affiliates object to 56 parties' claims
relating to environmental liability. A schedule of the 102 claims
is available for free at:
http://bankrupt.com/misc/Lyondell_ObjectedSec502Claims.pdf
Christopher R. Mirick, Esq., at Cadwalader, Wickersham & Taft
LLP, in New York, asserts that the Claims are claims for
reimbursement or contribution which is contingent, and pursuant
to Section 502(e)(1)(B), should be disallowed. Particularly, he
points out that 76 of the Claims, aggregating more than
$1 billion and asserted by private entities, are duplicative of
claims already filed by federal environmental agencies. A full-
text copy of the Duplicate Claims is available for free at:
http://bankrupt.com/misc/Lyondell_DuplicateSec502Claims.pdf
With respect to the claims of California Department of Toxic
Substances Control, the California Regional Water Quality Board
and the California State Water Resources Control Board, the
Debtors ask the Court to clarify whether injunctive obligations
under various federal and California state statutes to perform
work at environmental sites neither owned or operated by the
Debtors constitute "claims" under Section 101(5) of the
Bankruptcy Code.
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. On January 6, 2009,
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 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 US$8 billion in DIP financing
to fund continuing operations. The DIP financing includes two
credit agreements: a US$6.5 billion term loan, which comprises a
US$3.25 billion in new loans and a US$3.25 billion roll-up of
existing loans; and a US$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: Proposes Joint Venture With Sumitomo
-------------------------------------------------------
Lyondell Chemical Company and its debtor affiliates ask the
Bankruptcy Court to authorize Lyondell Centennial Corporation, a
non-debtor affiliate, to enter into an agreement with Sumitomo
Chemical Company, Ltd., to form a joint venture known as NOC Asia.
Starting more than 30 years before the Petition Date, Lyondell
Chemical and Sumitomo have maintained a long-running and
successful business partnership through a Nihon Oxirane joint
venture. NOC has been marketing and selling propylene oxide and
propylene glycol throughout Asia. To further reinforce
operations of their Asian PO and PG business, Lyondell Chemical
and Sumitomo engaged in extensive negotiations regarding the
formation of an additional joint venture to bolster their PO and
PG business in the region. Specifically, under the JV Agreement,
Lyondell Centennial and Sumitomo seek to form NOCA to serve as a
multi-national ASIAN PO and PG business management and marketing
company with its headquarters in Hong Kong. Sumitomo and
Lyondell Centennial intend to capitalize the joint venture
initially with $2.5 million, with Sumitomo contributing
$1.5 million and Lyondell Centennial contributing $1 million. Of
the total capitalization, $500,000 will be for the creation of IT
infrastructure support for the NOCA. The $500,000 amount is
expected to be reimbursed by the NOCA to Lyondell Centennial
shortly after start-up.
Christopher R. Mirick, Esq., at Cadwalader, Wickersham & Taft
LLP, in New York, notes that the transactions contemplated in the
JV Motion are consistent with the ordinary course of Lyondell
Chemical's longstanding business relationship with Sumitomo.
Indeed, the Debtors' DIP Term Loan Facility allows non-Debtor
subsidiaries to make certain investments in an aggregate amount
not exceeding $25 million and that Lyondell Centennial's
$1 million contribution will not violate the aggregate limit, he
cites. However, to alleviate any concerns regarding whether
Lyondell Centennial can consummate the transactions, and to
demonstrate Lyondell Chemical's commitment to its longstanding
business relationship with Sumitomo, Lyondell Chemical and
Sumitomo have agreed that Lyondell Centennial will obtain Court
authority to enter into the JV Agreement, he discloses.
Mr. Mirick stresses that it is essential to Lyondell Chemical's
Asian operations to maintain and enhance its PO and PG joint
venture with Sumitomo. Lyondell Centennial's entry into the JV
Agreement with Sumitomo will allow Lyondell Chemical and Sumitomo
to continue their strategic and profitable relationship
consistent with Lyondell Chemical's business plans, he maintains.
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. On January 6, 2009,
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 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 US$8 billion in DIP financing
to fund continuing operations. The DIP financing includes two
credit agreements: a US$6.5 billion term loan, which comprises a
US$3.25 billion in new loans and a US$3.25 billion roll-up of
existing loans; and a US$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)
MAGNA ENTERTAINMENT: Sept. 8 Auction for Santa Anita Cancelled
--------------------------------------------------------------
According to Pasadena Star-News, in California, the September 8
auction for Magna Entertainment Corp.'s Santa Anita Park was
postponed. Michael Wildish, a managing editor with Miller
Buckfire, advisor to Magna, said that while there has been a "lot
of interest" for the racetrack, no baseline bid was received by
the July 31 deadline.
Ron Charles, Santa Anita's president and CEO, said potential
bidders were reluctant to initiate bidding, fearing that they
would overpay for the property. "They prefer someone else step up
and see what their pricing might be," he said, according to the
report. "I think there's definitely interest in Santa Anita . . .
but at what price is to be determined."
As reported by the TCR on May 25, 2009, the Bankruptcy Court
approved the September 8 auction date for:
a) Racetracks: Santa Anita Park, Thistledown, Remington Park
and Portland Meadows
b) Interests: The partnership interests of MEC Texas Racing,
Inc. and Racetrack Holdings, Inc. in MEC Lone Star, LP and
the Debtors and non-debtor subsidiaries' joint venture
interests in The Shops at Santa Anita.
c) Other Property: The Ocala Property, the Dixon Property, Fex
Straw Manufacturing and Streufex.
Pursuant to the sale process approved by the Bankruptcy Court,
parties had until July 31 to make definitive bids for those
assets. The holding of a September 8 auction was contingent upon
the Debtor's entry into a "stalking horse" agreement with respect
to one or more of the assets.
According to Pasadena Star-News, Frank Stronach, majority
shareholder of Magna and its parent MI Developments, is rumored to
be interested in buying back Santa Anita by himself or with
partners.
About Magna Entertainment
Based in Aurora, Ontario, Magna Entertainment Corp. is North
America's largest owner and operator of horse racetracks based on
revenue. The Company develops, owns and operates horse racetracks
and related pari-mutuel wagering operations, including off-track
betting facilities. MEC also develops, owns and operates casinos
in conjunction with its racetracks where permitted by law.
MEC owns and operates AmTote International, Inc., a provider of
totalisator services to the pari-mutuel industry, XpressBet(R), a
national Internet and telephone account wagering system, as well
as MagnaBet(TM) internationally. Pursuant to joint ventures, MEC
has a 50% interest in HorseRacing TV(R), a 24-hour horse racing
television network, and TrackNet Media Group LLC, a content
management company formed for distribution of the full breadth of
MEC's horse racing content.
Following its failure to meet obligations to lenders led by PNC
Bank, National Association, and Wells Fargo Bank, National
Association, and controlling shareholder MI Developments Inc.'s
decision not to provide further financial backing, Magna
Entertainment Corp. and 24 affiliates filed for Chapter 11 on
March 5, 2009 (Bankr. D. Del. Lead Case No. 09-10720).
Marcia L. Goldstein, Esq., and Brian S. Rosen, Esq., at Weil,
Gotshal & Manges LLP, have been engaged as bankruptcy counsel.
Mark D. Collins, Esq., L. Katherine Good, Esq., and Maris J.
Finnegan, Esq., at Richards, Layton & Finger, P.A., are the
Debtors' local counsel. Miller Buckfire & Co. LLC is the Debtors'
investment banker and financial advisor. Kurtzman Carson
Consultants LLC is the claims and noticing agent for the Debtors.
Magna Entertainment Corp. had total assets of US$1.054 billion and
total liabilities of US$947.3 million based on unaudited
consolidated financial statements as of December 31, 2008.
MEDICURE INC: Defers $2.0MM Secured Debt Payment Until Nov. 30
--------------------------------------------------------------
Medicure Inc. said it has reached a further agreement with the
lender under its secured debt financing agreement dated as of
September 17, 2007, to defer required payments of roughly
US$2.0 million. The agreement will allow the Company to continue
its dialogue with the lender regarding its payment obligations,
and to explore restructuring or financing strategies. The
deferral will be in effect until the earlier of November 30, 2009,
and the date which is five business days following the date on
which Medicure receives written notice from the lender.
In the interim, management is also continuing work to improve
overall financial performance and to further refine its commercial
strategy for AGGRASTAT(R).
Medicure previously reached an agreement with the lender to
further defer a required payment of roughly US$1.7 million to
September 1, 2009, from August 14, 2009.
Based in Manitoba, Canada, Medicure Inc. (TSX:MPH) is a
biopharmaceutical company focused on the research, development and
commercialization of novel small molecules to treat cardiovascular
and neurological disorders. The Company's primary business
activity is the marketing and distribution of AGGRASTAT(R)
(tirofiban hydrochloride) in the United States for acute coronary
syndromes.
MEDICURE INC: Posts C$13.3MM Loss for Fiscal Year Ended May 31
--------------------------------------------------------------
Medicure Inc. on September 2, 2009, released its annual report for
the fiscal year ended May 31, 2009.
Recent Developments:
-- The Company implemented a modest price increase on its
commercial drug AGGRASTAT(R) during the 3rd quarter,
following suit with its competitors.
-- The Company began enrollment in a 140 patient Phase II
clinical study of TARDOXAL for the treatment of Tardive
Dyskinesia.
-- During the fourth quarter of 2009 the Company had
initiated discussions with its senior lender to
restructure the existing arrangements. The Company has
also continued to explore other strategic arrangements to
recapitalize the Company. In conjunction with this the
Company has focused internally on further cost savings
measures.
-- The Company received extensions from its senior lender to
defer a US$1.7 million payment due July 15, 2009, to give
the parties additional time to develop an appropriate
restructuring plan for the Company.
-- The Company has reduced its sales staff and is in the
process of aligning the remaining U.S. field
representatives with the Company's refined marketing and
sales strategy. The Company is also working on reducing
its corporate overhead expenses by outsourcing more of its
administrative and financial functions.
The Company recorded a loss of C$13,315,827 and negative cash
flows from operations of C$9,687,663 in the year ended May 31,
2009, and the Company reported an accumulated deficit of
C$148,549,300 as at May 31, 2009. In March 2008, the Company
announced a corporate restructuring which included a significant
reduction in number of staff and in resources allocated to certain
programs.
The Company disclosed that total assets declined by C$25.2 million
to C$9.6 million at May 31, 2009, primarily as a result of the
C$1.8 million write-down of intangible assets, the use of cash
from operating activities of C$9.8 million, and repayment of the
long-term loan to GE Canada Assets Financing (formally Merrill
Lynch) of US$12 million. Total liabilities decreased by
C$12.3 million to C$29.1 million at May 31, 2009, primarily as a
result of the repayment of the GE long-term loan of C$12 million,
a reduction in accounts payable of C$3 million and partially
offset by an unrealized foreign exchange loss on Birmingham long-
term debt of C$2.4 million.
At May 31, 2009, the Company had cash and cash equivalents
totaling C$1,979,000 and restricted cash of nil compared to
C$11,905,000 of cash and cash equivalents as well as C$11,916,000
of restricted cash as of May 31, 2008. As at May 31, 2009, the
Company had a working capital deficiency of C$535,000 compared to
working capital of C$5,242,000 at May 31, 2008. The reduction of
working capital was mainly due to the use of funds to support
operations offset by a repayment of C$1,986,000 of current long
term debt out of restricted funds. The Company currently has
accrued US$1.7 million in debt service obligations.
The Company said its future operations are dependent upon its
ability to achieve positive cash flows from operations, to
restructure its debt, complete other strategic alternatives, or
secure additional funds. The Company acknowledged the outcome of
its discussions with its senior lender and other strategic
partners is undeterminable at this time.
The Company said if it is unable to restructure its debt, complete
other strategic alternatives, or secure additional funds, the
Company will have to consider additional strategic alternatives
which may include, among other strategies, asset divestitures,
monetization of certain intangibles, or the winding up,
dissolution or liquidation of the Company. The Company's main
assets are pledged as security to its senior lender including its
intangible assets on MC-1 and Aggrastat.
On June 25, 2009, Medicure announced a plan to raise up to
C$3.0 million to improve its financial position through a non-
brokered private placement of common shares at a price of $0.05
per common share. The Company said the maximum number of common
shares to be issued upon the Offering represents roughly 46% of
the number of common shares of Medicure currently issued and
outstanding.
The Company said its President and Chief Executive Officer, Albert
D. Friesen, Ph.D, was to participate in the Offering and to
subscribe for roughly 33.33% of the common shares issuable
thereunder. As of June 25, Dr. Friesen held common shares equal
to roughly 7.38% of the Company's issued and outstanding common
shares, and upon completion of the Offering, would be expected to
hold roughly 15.57% of the then issued and outstanding common
shares. David Banks, a director, was expected to subscribe for up
to 3.33% of the common shares issuable under the Offering. Mr.
Banks as of June 25 held common shares equal to roughly 0.74% of
the Company's issued and outstanding common shares, and upon
completion of the Offering, would be expected to hold, roughly
1.56% of the then issued and outstanding common shares.
Under the rules of the TSX, the Offering would ordinarily require
that the Company obtain shareholder approval as a result of the
fact insiders of the Company subscribing under the Offering may
acquire more than 10% of the number of shares currently issued and
outstanding. However, Section 604(e) of the TSX Company Manual
and similar provisions of applicable provincial securities
legislation provide an exemption from the requirement to obtain
shareholder approval in respect of related party transactions for
companies in serious financial difficulty. The TSX has advised
that the Company would automatically be subject, in the ordinary
course, to a delisting review as a result of relying on the
financial hardship exemption under Section 604(e).
A full-text copy of the Management Discussion & Analysis for the
Year Ended May 31, 2009, is available at no charge at:
http://bankrupt.com/misc/MDA_2009.pdf
Based in Manitoba, Canada, Medicure Inc. (TSX:MPH) is a
biopharmaceutical company focused on the research, development and
commercialization of novel small molecules to treat cardiovascular
and neurological disorders. The Company's primary business
activity is the marketing and distribution of AGGRASTAT(R)
(tirofiban hydrochloride) in the United States for acute coronary
syndromes.
MERRILL LYNCH: Close to Suing BofA for Alleged Securities Fraud
---------------------------------------------------------------
David Markowitz, the chief of New York state attorney general
Andrew Cuomo's investor-protection bureau, has warned in a letter
to Bank of America Corp. that the attorney general is close to
filing securities-fraud charges against the bank's executives, Dan
Fitzpatrick at The Wall Street Journal reports.
According to The Journal, the attorney general's office alleged
that BofA failed at least four times to tell shareholders material
information related to the bank's takeover of Merrill Lynch & Co.
The Journal states that Mr. Markowitz accused BofA of
"indiscriminate invocation of the attorney-client privilege" and
"hindering" efforts to determine which company officers should be
charged. The investor-protection bureau demanded more information
about conversations deemed privileged by BofA officials, says the
report.
Citing Mr. Markowitz, The Journal relates that among the four
examples of wrongdoing are:
-- the Merrill bonuses, and
-- BofA's failure to "disclose before a December shareholder
vote either ballooning losses at Merrill or a goodwill
charge related to a subprime lender owned by Merrill".
Mr. Markowitz, according to The Journal, said in the letter that
former BofA General Counsel Timothy Mayopolous told Mr. Cuomo's
investigators that executives discussed four days before the vote
whether the bank should withdraw from the deal by invoking a
"material adverse change" clause, but the bank "has precluded Mr.
Mayopolous from answering any substantive questions about the
meeting."
About Bank of America
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.
MERILL LYNCH: To Pay $26.5MM to Settle Texas' Securities Complaint
------------------------------------------------------------------
Texas State Securities Commissioner Denise Voigt Crawford said
that Merrill Lynch & Co. has agreed to pay $26.5 million to settle
Texas' claims that the Company allowed sales assistants to sell
securities without being properly registered, Kevin Kingsbury at
The Wall Street Journal reports.
According to The Journal, Texas launched a probe on Merrill Lynch
after receiving a tip from a former company employee in May 2008.
"The tip alleged that Merrill Lynch saved money on registration
fees because their client associates only registered in two states
-- the associate's home state and one neighboring state," The
Journal quoted Ronak Patel, an attorney with the State Securities
Board's inspections and compliance division, as saying. The
employees act as sales assistants and administrative support
personnel for Merrill Lynch's financial advisers, the report
states.
The State Securities Board said in a statement, "Client associates
also accepted trade orders from clients, a practice that requires
registration both in the client associate's home state and in the
client's state." The Journal relates that the State Securities
Board claimed that Merrill Lynch's supervisory system was "not
reasonably designed to ensure that its client associates complied
with registration requirements."
Merrill Lynch has instituted new supervisory controls on client-
associate registration, The Journal reports, citing the state of
Texas.
About Bank of America
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.
MGM MIRAGE: Discloses Terms of Employment Pact With Gary Jacobs
---------------------------------------------------------------
MGM MIRAGE reports that on August 31, 2009, it entered into an
Employment Agreement with Gary N. Jacobs, with an effective date
of August 3, 2009. Mr. Jacobs agreed to serve as President
Corporate Strategy, General Counsel and Secretary of the Company
for a term that expires on August 4, 2013.
The Employment Agreement provides for an annual base salary of
$1,200,000. Mr. Jacobs is also eligible to receive an annual
bonus and will receive certain other benefits and perquisites,
which are discussed in detail in the Employment Agreement.
The Company may terminate the Employment Agreement for good cause.
In such event, Mr. Jacobs will be entitled to exercise his vested
stock options, stock appreciation rights and other stock based
compensation in accordance with their terms as of the date of
termination. If the Employment Agreement is terminated as a
result of death or disability, Mr. Jacobs (or his beneficiary)
will be entitled to receive his salary for a 12-month period
following such termination and a prorated portion of any bonus
attributable to the fiscal year in which the death or disability
occurs. Additionally, Mr. Jacobs (or his beneficiary) will be
entitled to exercise those of his unexercised options, stock
appreciation rights and other stock based compensation that would
have vested as of the first anniversary of the date of
termination, and all shares of restricted stock will immediately
vest.
If the Company terminates the Employment Agreement other than for
good cause, the Company will pay Mr. Jacobs' salary for the
remaining term of the Employment Agreement and his bonus during
the 12-month period (or shorter period if the termination occurs
within the last year of the term) during which he is restricted
from working for or otherwise providing services to a competitor
of the Company. Additionally, the Employment Agreement provides
that for the remainder of the term, (i) all unvested stock
options, unvested restricted stock and other stock based
compensation held by Mr. Jacobs will vest in accordance with their
terms, (ii) the Company will provide contributions, if any, on Mr.
Jacobs behalf, to the Supplemental Executive Retirement Plan II,
Deferred Compensation Plan II or other equivalent plans and (iii)
certain other employee benefits, such as health and life insurance
will continue. Notwithstanding, all compensation and benefits are
subject to mitigation if Mr. Jacobs works for or otherwise
provides services to a third party.
If Mr. Jacobs seeks to terminate the Employment Agreement for good
cause, he must give the Company 30 days' notice to cure the
breach. If such breach is not cured (and the Company does not
invoke its right to arbitration), the termination will be treated
as a termination for other than good cause by the Company.
However, if the Company invokes its arbitration right, Mr. Jacobs
must continue to work until the matter is resolved, otherwise it
becomes a termination by him without cause. In such event, Mr.
Jacobs will be entitled to exercise his vested stock options,
stock appreciation rights and other stock based compensation in
accordance with their terms and to receive all other vested
benefits and compensation, provided, however, that Mr. Jacobs will
be restricted from working for or otherwise providing services to
a competitor of the Company during the Restrictive Period.
If there is a change of control of the Company, all of Mr. Jacobs'
unvested stock options, unvested restricted stock, unvested stock
appreciation rights and other stock based compensation will fully
vest. Furthermore, Mr. Jacobs may terminate the Employment
Agreement upon delivery of 30 days prior notice to the Company, no
later than 90 days following the date of the change of control.
In such event, the Company will pay Mr. Jacobs a lump sum payment
equal to the sum of (x) his unpaid salary through the end of the
term of the Employment Agreement, and (y) an amount in lieu of his
bonus. Additionally, through the end of the term, the Company
will provide contributions, if any, on his behalf, to SERP II, DCP
II or other equivalent plans in accordance with their terms and
certain employee benefits, such as health and life insurance.
About MGM MIRAGE
Headquartered in Las Vegas, Nevada, MGM MIRAGE (NYSE: MGM) --
http://www.mgmmirage.com/-- is a hotel and gaming company. It
owns and operates 17 properties located in Nevada, Mississippi and
Michigan, and has investments in three other properties in Nevada,
New Jersey and Illinois.
At June 30, 2009, the Company had $22.4 billion in total assets,
including $1.07 billion in total current assets; $1.23 billion in
total current liabilities, $3.58 billion in deferred income taxes,
$12.3 billion in long-term debt, $186.7 million in other long-term
obligations; and $5.04 billion in stockholders' equity.
* * *
MGM Mirage continues to carry Standard & Poor's Ratings Services'
'CCC+' corporate credit ratings and Moody's Investors Service's
Caa2 Corporate Family Rating and Caa3 Probability of Default
Rating.
MGM MIRAGE: Macau Gambling Revenue Market Share Up 11% in August
----------------------------------------------------------------
Alexandra Berzon at The Wall Street Journal reports that MGM
Mirage increased its market share of Macau gambling revenue to 11%
in August 2009, compared to 8% in June 2009.
The Journal quoted MGM Mirage CEO Jim Murren as saying, "We're
feeling better . . . . We underperformed relative to our
potential. We made a lot of changes."
Mr. Murren, according to The Journal, said that MGM Mirage made
early mistakes by over-estimating Chinese gamblers' interest in
high-end restaurants and hotel rooms. "We put a lot of money in
public spaces, a beautiful conservatory, and restaurants and rooms
and they haven't embraced that to make it economically viable.
Where we compete best is in the high-end resort experience, but we
could not afford to neglect the fact that, regardless of what we
want, customers are going to do what they want. That was one of
the philosophical changes we needed to make," the report quoted
Mr. Murren as saying.
Mr. Murren said that MGM Mirage has changed the management team,
stepped up its marketing, and focused on making its casino areas
more appealing to serious gamblers, The Journal states. The
report states that changes include adjusting menus at restaurants
to accommodate local tastes and moving drinks closer to gamblers.
Headquartered in Las Vegas, Nevada, MGM MIRAGE (NYSE: MGM) --
http://www.mgmmirage.com/-- is a hotel and gaming company. It
owns and operates 17 properties located in Nevada, Mississippi and
Michigan, and has investments in three other properties in Nevada,
New Jersey and Illinois.
At June 30, 2009, the Company had $22.4 billion in total assets,
including $1.07 billion in total current assets; $1.23 billion in
total current liabilities, $3.58 billion in deferred income taxes,
$12.3 billion in long-term debt, $186.7 million in other long-term
obligations; and $5.04 billion in stockholders' equity.
* * *
As reported by the TCR on September 1, 2009, Standard & Poor's
Ratings Services assigned its issue-level and recovery ratings to
Las Vegas-based MGM MIRAGE's proposed up to $500 million senior
unsecured notes due 2016. The notes were rated 'CCC+' (at the
same level as the corporate credit rating on the company) with a
recovery rating of '4', indicating S&P's expectation of average
(30%-50%) recovery for noteholders in the event of a payment
default. At the same time, S&P affirmed all of its existing
ratings on MGM MIRAGE, including the 'CCC+' corporate credit
rating. The rating outlook is developing.
MICHAEL MCCULLOUGH: Section 341(a) Meeting Slated for October 1
---------------------------------------------------------------
The U.S. Trustee for Region 16 will convene a meeting of creditors
in Michael Brian McCullough's Chapter 11 case on Oct. 1, 2009, at
10:00 a.m. The meeting will be held at RM 1-159, 411 W Fourth
St., Santa Ana, California.
This is the first meeting of creditors required under Section
341(a) of the Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
Headquartered in Laguna Beach, California, Michael Brian
McCullough fdba Michael Brian Interior Design operates an interior
design business. The Company filed for Chapter 11 on Aug. 21,
2009 (Bankr. C. D. Calif. Case No. 09-18788). The Law Offices of
Michael G. Spector represents the Debtor in its restructuring
effort. In its petition, the Debtor listed $10,000,001 to
$50,000,000 in assets and $1,000,001 to $10,000,000 in debts.
MICHAEL MCCULLOUGH: Selects Spector Law Office as Counsel
---------------------------------------------------------
Michael Brian McCollough asks the U.S. Bankruptcy Court for the
Central District of California for authority to employ the Law
Offices of Michael G. Spector as his counsel.
The firm has agreed to (i) prepare pleadings, applications and
conduct examinations incidental to administration; (ii) advise and
represent the Debtor in connection with all the applications and
motions; and (iii) advise and assist the Debtor in the formulation
and presentation of a plan, among other things.
Michael G. Spector, Esq., charges $375 per hour while Vicki L.
Schennum, Esq., bills $350 per hour for this engagement. The
firm's paralegal and law clerk charges $100 per hour.
Mr. Spector assures the Court that the firm is a "disinterested
person" within the meaning of Section 101(14) of the Bankruptcy
Code.
Michael Brian McCollough filed for Chapter 11 protection Aug. 21,
2009 (Bankr. C.D. Calif. Case No. 09-18788). Michael G. Spector,
Esq., and Vicki L. Schennum, Esq., Law Offices of Michael G.
Spector, represents the Debtor.
MXENERGY INC: Maturity of Societe Generale Loan Moved to Sept. 21
-----------------------------------------------------------------
MXenergy Inc. and MXenergy Electric Inc., subsidiaries of MXenergy
Holdings Inc., entered into the Eighth Amendment and Waiver dated
as of August 31, 2009, to the Third Amended and Restated Credit
Agreement dated as of November 17, 2008, as amended, with the
lender parties and Societe Generale, as administrative agent.
Pursuant to the terms of the Credit Agreement Amendment, the
maturity date under the Credit Agreement was extended to
September 21, 2009. Additionally, the definition of "Trigger
Event" contained therein was amended and restated in its entirety
to mean:
1) on or prior to September 4, 2009:
a) the administrative agent has not received written
confirmation (which written confirmation may be sent
via electronic mail) from Sempra Energy Trading LLC --
the Refinance Party as defined in the Credit Agreement
Amendment -- confirming that:
(i) it has negotiated and agreed to the final form
Of the Collateral LOC (as defined in the Credit
Agreement Amendment) with the issuing bank, and
it will provide for the delivery of the
Collateral LOC (as defined in the Credit
Agreement Amendment) to the issuing bank on or
before the closing date of the proposed
transaction between the Refinance Party and the
Borrowers -- that would provide for the
refinancing in full of the Obligations and
delivery to the Issuing Bank of a back-to-back
letter of credit in favor of the Issuing Bank on
or before the Maturity Date;
(ii) it has negotiated and agreed to the final form
of Payoff Letter with the administrative agent
and will accept the Payoff Letter from the
administrative agent and the Borrowers under the
Credit Agreement in connection with the closing
of the Refinance Transaction, without requiring
any other terms, conditions or documentation
from the administrative agent or the Lenders
under the Credit Agreement concerning the
matters contained therein; and
(iii) it actively continues to negotiate definitive
documentation in good faith with the Company and
the Borrowers on the Refinance Transaction and
that the Refinance Party's due diligence
investigation of the Borrowers' business has not
identified any materially adverse matters in the
judgment of the Refinance Party;
b) the final form of Collateral LOC is not in form and
substance satisfactory to the issuing bank in its sole
discretion; or
c) the final form of Payoff Letter is not in form and
substance satisfactory to the administrative agent in
its sole discretion;
2) on or prior to September 8, 2009, the Borrowers fail to
deliver to the administrative agent evidence satisfactory
to the administrative agent and the Majority Lenders (as
defined in the Credit Agreement) that the FERC Approval
has been obtained;
3) on or prior to September 20, 2009, holders of at least 95%
(or, if the applicable condition precedent in the Exchange
Offering Memo is waived by a sufficient number of holders
of the Senior Notes pursuant to evidence satisfactory to
the administrative agent and the Majority Lenders in their
sole discretion, 90%) of the outstanding principal amount
of the Senior Notes (excluding Senior Notes owned by the
Company) shall not have validly tendered and not withdrawn
their Senior Notes in the Senior Notes Exchange Offer (as
defined in the Credit Agreement), as modified pursuant to
an amendment to the Exchange Offering Memo;
4) the Senior Notes Exchange Offer or the Exchange Offering
Memo:
a) expires or is terminated without holders of a
sufficient amount of the Senior Notes to make the
Senior Notes Exchange Offer effective having validly
tendered and not withdrawn their Senior Notes in the
Senior Notes Exchange Offer; or
b) is amended or otherwise modified in any manner (unless
amended or otherwise modified solely to: (i) reflect
the final terms agreed to (pursuant to evidence
satisfactory to the administrative agent and the
Majority Lenders in their sole discretion) by the
Company, the Refinance Party and the holders of the
Senior Notes, and such amendment or other modification
is in form and substance reasonably satisfactory to the
administrative agent and the Majority Lenders; or (ii)
extend the expiration date of the Senior Notes Exchange
Offer such that it is consummated and settled
simultaneously with the closing of the Refinance
Transaction; or
5) the Company or a Borrower receives a notice of or becomes
aware of a termination or abandonment by the Refinance
Party of the Refinance Transaction, or a significant
change in structure that could reasonably be expected to
delay the closing thereof to after the Maturity Date, or
the Company, a Borrower or any of their subsidiaries takes
any action to terminate or abandon the Refinance
Transaction, or fails to take any action which failure has
the effect of terminating or abandoning the Refinance
Transaction.
The Credit Agreement Amendment includes these amendments regarding
letters of credit:
1) the final date on which the Company may request issuance,
increase, amendment, renewal or extension of letters of
credit under the Credit Agreement was amended to the date
which is five business days prior to the Maturity Date;
and
2) no letter of credit issued, increased, amended, renewed or
extended prior to the effective date of the Credit
Agreement Amendment shall have an expiration date later
November 30, 2009 (other than up to $40 million face
amount of letters of credit which may have an expiration
date not later than January 31, 2010).
The Credit Agreement Amendment also requires that the Company
maintain a Minimum Consolidated Tangible Net Worth of
$25.0 million for the months of August and September 2009.
Furthermore, the Credit Agreement Amendment provides that the loan
parties shall not permit the aggregate amount of natural gas
inventory to exceed 6.6 Bcf on any day in the month of September
2009.
MXenergy also entered into the Fifteenth Amendment to Master
Transaction Agreement dated as of August 31, 2009 -- Hedge
Agreement Amendment -- with the Company and certain of its
subsidiaries, as guarantors, and Societe Generale, as hedge
provider, amending certain provisions of the Master Transaction
Agreement dated as of August 1, 2006. Certain provisions of the
Hedge Agreement Amendment amended the Hedge Agreement primarily to
conform to provisions of the Credit Agreement Amendment, including
the extension of the commitment termination date of the Hedge
Agreement to September 21, 2009. In addition, the Hedge Agreement
Amendment also amended various other provisions of the Hedge
Agreement, including:
1) The total permitted hedged volume under the Hedge
Agreement was reduced from 11 Bcf to 10 Bcf; and
2) The expiration date of the letter of credit issued under
the Credit Agreement to support hedge liabilities of the
Company to the Hedge Provider was extended to October 26,
2009.
A full-text copy of the Eighth Amendment and Waiver to the Third
Amended and Restated Credit Agreement, dated as of August 31,
2009, by and among MXenergy and MXenergy Electric, as borrowers,
MXenergy Holdings and certain of its subsidiaries, as guarantors,
the lender parties and Societe Generale, as administrative agent,
is available at no charge at http://ResearchArchives.com/t/s?444f
A full-text copy of the Fifteenth Amendment to the Master
Transaction Agreement, dated as of August 31, 2009, by and among
MXenergy Inc., the Company and certain of its subsidiaries, as
guarantors, and Societe Generale, as hedge provider, is available
at no charge at http://ResearchArchives.com/t/s?4450
About MXenergy
MXenergy Holdings, Inc. -- http://www.mxenergy.com/-- is one of
the fastest growing retail natural gas and electricity suppliers
in North America, serving roughly 500,000 customers in 39
utility territories in the United States and Canada. The Company
was founded in 1999 to provide natural gas and electricity to
consumers in deregulated energy markets. MXenergy is a member of
the Chicago Climate Exchange and an Energy Star Partner.
The Company has indicated in a regulatory filing with the
Securities and Exchange Commission that if its restructuring
efforts are not successful, it intends to explore all other
alternatives, but would likely be required to commence a
bankruptcy proceeding.
MXENERGY HOLDINGS: Moves Exchange Offer Deadlines to Sept. 17
-------------------------------------------------------------
MXenergy Holdings Inc. said as of 5:00 p.m., New York City time on
September 3, 2009, it elected to extend the early consent deadline
and the withdrawal deadline for the exchange offer and consent
solicitation of its outstanding Floating Rate Senior Notes due
2011 (CUSIP Nos. 62846X AA3; U62432 AA4;62846X AC9) until 5:00
p.m., New York City time, on September 17, 2009.
The Company also said as of 12:00 a.m. midnight, New York City
time, on September 4, 2009, it elected to extend the expiration
date for the Exchange Offer and Consent Solicitation until 12:00
a.m. midnight, New York City time, on September 18, 2009. As of
12:00 a.m. midnight, New York City time, on September 4, 2009,
approximately $154.9 million in aggregate principal amount of the
Notes had been tendered in the Exchange Offer and consented to the
proposed amendments in the Consent Solicitation.
About MXenergy
MXenergy Holdings, Inc. -- http://www.mxenergy.com/-- is one of
the fastest growing retail natural gas and electricity suppliers
in North America, serving roughly 500,000 customers in 39
utility territories in the United States and Canada. The Company
was founded in 1999 to provide natural gas and electricity to
consumers in deregulated energy markets. MXenergy is a member of
the Chicago Climate Exchange and an Energy Star Partner.
The Company has indicated in a regulatory filing with the
Securities and Exchange Commission that if its restructuring
efforts are not successful, it intends to explore all other
alternatives, but would likely be required to commence a
bankruptcy proceeding.
Standard & Poor's Ratings Services on August 12 said it lowered
its long-term corporate credit rating on natural gas retail
marketer MXEnergy Holdings Inc. to 'SD' from 'CC'. In addition, we
lowered the rating on the company's approximate $165 million of
senior unsecured notes due 2011 to 'D' from 'C'. The recovery
rating on MXEnergy's notes is unchanged at '6', which indicates
that lenders can expect negligible (0% to 10%) recovery in the
event of a payment default.
"We are taking the rating action due to the pending completion of
the company's exchange offer, which has already received
sufficient note tenders to institute the exchange offer. We also
expect to withdraw the company's rating in the very near future at
the company's request. We have not changed the '6' recovery
rating, which reflects our expectations for the small quantity of
notes that have not been tendered. We expect negligible recovery
(0-10%) upon default due to the senior claims of the company's
secured credit facilities," S&P said.
NESTOR INC: Goldman Capital Ceases to Hold Company Shares
---------------------------------------------------------
Goldman Capital Management Inc. disclosed in a Schedule 13G filing
with the Securities and Exchange Commission that it has ceased to
be the beneficial owner of more than 5% of the common shares of
Nestor Inc. Goldman Capital no longer holds any shares of the
Company.
As reported by the Troubled Company Reporter on June 17, 2009,
Judge Michael A. Silverstein of the Rhode Island Superior Court
approved Nestor Traffic Systems and its parent company Nestor,
Inc.'s petition for a court-appointed receiver to be charged with
overseeing all aspects of the Company's operations. The Court
designated Jonathan N. Savage, Esq., of Shechtman, Halperin, and
Savage, LLP, as interim receiver. The appointment was effective
immediately.
As an arm of the court, Mr. Savage has full authority with regard
to the operations of the facility. The receiver will also market
Nestor's assets to financial investors, strategic investors and
other suitable bidders.
Mr. Savage is a partner with Shechtman, Halperin, and Savage, LLP,
based in Rhode Island. Mr. Savage focuses his practice in the
areas of receiverships, real estate law, and business and
commercial law. He has been appointed by the courts on a regular
basis to act as the fiduciary for businesses in financial
distress.
About Nestor Inc.
Nestor Inc. (OTC BB: NEST) -- http://www.nestor.com/-- provides
advanced automated traffic enforcement solutions and services to
state and municipal governments.
NEW CENTURY COS: Restates Form 10-Q for First Quarter
-----------------------------------------------------
New Century Companies, Inc., filed with the Securities and
Exchange Commission an Amendment to Form 10-Q for the three-month
period ended March 31, 2009, to restate the condensed consolidated
financial statements and all the disclosures accordingly.
In connection with the preparation of its condensed consolidated
financial statements for the quarter ended June 30, 2009, the
Company discovered errors in its valuation of its derivative
liabilities, certain contract related balances and a
classification error, which the Company reported for the three-
month period ended March 31, 2009, and needed to be restated.
Specifically, the condensed consolidated financial statements are
being restated to (i) change the valuation of its derivative
liabilities, (ii) decrease the reported change in warrant value
during the quarter ended March 31, 2009, and (iii) adjust its
revenues, cost of sales, costs in excess of billings and billings
in excess of costs in connection with its contract accounting.
In addition, the Company filed its Form 10-Q for the period ended
March 31, 2009, before its prior independent registered public
accounting firm completed its review of the condensed consolidated
financial statements for the period then ended.
A full-text copy of the Company's Form 10-Q/A is available for
free at http://ResearchArchives.com/t/s?441c
A full-text copy of the Company's Form 10-Q is available for free
at http://ResearchArchives.com/t/s?4436
New Century Companies, Inc., and its wholly owned subsidiary, New
Century Remanufacturing, Inc., provides after-market services,
including rebuilding, retrofitting and remanufacturing of metal
cutting machinery. Once completed, a remanufactured machine is
"like new" with state-of-the-art computers and the cost to the
Company's customers is substantially less than the price of a new
machine. The Company currently sells its services by direct sales
and through a network of machinery dealers primarily in the United
States. Its customers are generally medium to large sized
manufacturing companies in various industries where metal cutting
is an integral part of their businesses. The Company grants
credit to its customers who are predominately located in the
western United States. The Company trades on the OTC Bulletin
Board under the symbol "NCNC."
NOVA HOLDING: Court Sets October 23 as Claims Bar Date
------------------------------------------------------
The Hon. Kevin Gross of the U.S. Bankruptcy Court for the District
of Delaware set Oct. 23, 2009, at 4:00 p.m., as deadline for
creditors of Nova Holding Clinton County LLC and its debtor-
affiliates to file proofs of claim.
Based in Seneca, Illinois, Nova Holding Clinton County, LLC, makes
industrial organic chemicals and biological products. Nova
Holding and certain affiliates filed for Chapter 11 protection on
March 30, 2009 (Bankr. D. Del. Lead Case No. 09-11081). Michael
B. Schaedle, Esq., Melissa S. Vongtama, Esq., and Josef W. Mintz,
Esq., at Blank Rome LLP, in Philadelphia, represent the Debtors as
counsel. David W. Carickhoff, Esq., at Blank Rome LLP, is
Delaware counsel to the Debtors. The Debtors listed between
$10 million and $50 million each in assets and debts.
NOVA HOLDING: Has Until November 30 to File Chapter 11 Plan
-----------------------------------------------------------
The Hon. Kevin Gross of the U.S. Bankruptcy Court for the District
of Delaware extended the exclusive periods of Nova Holding Clinton
County LLC to:
* file a Chapter 11 plan until Nov. 30, 2009; and
* solicit acceptances until Jan. 29, 2010.
The Debtors told the Court that they have made substantial
progress in the short period since the commencement of their cases
and have not yet completed the process for the sale of their
assets.
Based in Seneca, Illinois, Nova Holding Clinton County, LLC, makes
industrial organic chemicals and biological products. Nova
Holding and certain affiliates filed for Chapter 11 protection on
March 30, 2009 (Bankr. D. Del. Lead Case No. 09-11081). Michael
B. Schaedle, Esq., Melissa S. Vongtama, Esq., and Josef W. Mintz,
Esq., at Blank Rome LLP, in Philadelphia, represent the Debtors as
counsel. David W. Carickhoff, Esq., at Blank Rome LLP, is
Delaware counsel to the Debtors. The Debtors listed between
$10 million and $50 million each in assets and debts.
NR GROUP: BK Opts Out of Deal with City of Alexandria
-----------------------------------------------------
According to The Town Talk, BK Fulton Management LLC, under
contract to run the Fulton Hotel until August 2009 after operator
NR Group LLC filed for bankruptcy, sought a longer deal to run the
hotel and an option to purchase the hotel. BK, however, opted not
to renew the deal with the city of Alexandria, in Virginia, as it
was not interested in pursuing a deal that involves the closed and
privately owned Hotel Bentley and the city's Alexandria Riverfront
Center.
The report relates that Alexandria Mayor Jacques M. Roy is
negotiating a "global deal" with Noble Hospitality regarding the
Fulton, Hotel Bentley and the Alexandria Riverfront Center. The
city's search for a three-property deal downtown "was different
from my vision," Mr. Rosenfeld said.
According to thetowntalk.com, Noble Hospitality's contract to run
the hotel for six months gives Alexandria the right to a buyout
after four months. The report states that Noble Hospitality will
be paid a $10,000 retainer fee and $9,000 a month to run the
hotel.
About NR Group
The Alexander Fulton Hotel, through its owner the NR Group, LLC,
filed for Chapter 11 bankruptcy protection on November 14, 2008
(Bankr. W.D. La. Case No. 08-81329). Wade N. Kelly, who has an
office in Louisiana, assists the Alexandria, Louisiana-based group
in its restructuring efforts. NR listed $1,000,001 to $10,000,000
in assets and $1,000,001 to $10,000,000 in liabilities.
NV BROADCASTING: Plan Confirmation Hearing Slated for Sept. 10
--------------------------------------------------------------
NV Broadcasting LLC will appear before the Bankruptcy Court on
September 10, 2009, to seek confirmation of its proposed Chapter
11 reorganization plan. According to Bill Rochelle at Bloomberg
News, the Company received approval of the plan solicitation
materials, including the disclosure statement, on August 28, and
within days the plan was accepted unanimously by all creditors
entitled to vote.
NV Broadcasting, LLC, and its affiliates filed a disclosure
statement to accompany their joint Chapter 11 plan of
reorganization, dated as of July 31, 2009, with the U.S.
Bankruptcy Court for the District of Delaware.
Terms of Plan
The Plan provides for a restructuring of the Debtors' financial
obligations, which will result in a significant deleveraging of
the Debtors to better compete in the broadcasting market.
Distributions under the Plan will be sourced from an exit secured
term loan. The Exit Secured Term Loan is a 3-year first priority
senior secured multi-draw term loan facility in an aggregate
principal amount of $28,000,000.
Pursuant to the Plan, holders of First Lien Loan Claims, allowed
in an amount not less than $274,021,842, will receive a transfer
of their ratable proportion of 100% of the membership interests in
NVT Holdings. Projected recovery under the Plan is 33%.
The projected recovery under the Plan for holders of general
unsecured trade claims against NV Media, LLC, with allowed amounts
of $9,719,803, is 100%. Each allowed NV general unsecured trade
claim will (a) be reinstated as an obligation of NVT Networks; (b)
receive such treatment as to which NVT Networks will have agreed
to in writing; or (c) be treated in any other manner so that such
NV general unsecured trade claim will otherwise be rendered
unimpaired. Holders of general unsecured claims against PBC, with
allowed amount of $600,850, will receive the same treatment as the
NV general unsecured trade claims.
Holders of the Second Lien Loan Claims who vote to accept the Plan
will receive a transfer of its ratable proportion of the Second
Lien Equity upon execution of NVT Holdings' amended and restated
operating agreement by the members thereof, and holders of the
Second Lien Loan Claims who vote to reject the Plan will not
receive any transfers of property on account of such holder's
Second Lien Loan Claim and the aggregate amount of Second Lien
Equity to be transferred pursuant to section 4.7 of the Plan will
be reduced by the percentage determined by dividing (x) the
aggregate face amount of the Rejecting Second Lien Claims by (y)
the total Second Lien Loan Claims.
The projected recovery under the Plan for second lien loan claims,
which are allowed in the amount of $94,972,735, is 3%.
Holders of interests will receive no distribution of property
under the Plan, and holders thereof are not entitled to vote, and
conclusively presumed to reject the Plan.
A full-text copy of the disclosure statement explaining the
Debtors' joint Chapter 11 plan is available for free at:
http://bankrupt.com/misc/nvbroadcasting.DS.pdf
About NV Broadcasting
NV Broadcasting, LLC, is a wholly owned subsidiary of NV
Television, LLC, which in turn is wholly owned by NV Media, LLC,
whose parent is New Vision Television, LLC, who is not a debtor in
these cases.
PBC Television Holdings is a privately-held limited liability
company that owns 100% of PBC Broadcasting, LLC. Todd Parkin owns
100% of the issued and outstanding limited liability company units
of PBC Television Holdings.
The NV Debtors own and operate 11 television stations that are
affiliated with major networks, together with several satellite
stations and additional low power television stations that
retransmit the signals of the affiliated television stations, and
through joint sales or share services agreements, provide sales,
operational, and other services to two major network affiliated
stations owned by the PBC Debtors. The NV and PBC stations are
located in nine diverse markets across the southern, midwestern
and nortwestern United States.
The NV Debtors and the PBC Debtors filed separate petitions for
Chapter 11 relief on July 13, 2009 (Bankr. D. Del. Lead Case No.
09-12473). In its petition, NV Broadcasting, LLC, listed between
$10 million and $50 million in assets, and between $100 million
and $500 million in liabilities.
Locke Lord Bissell & Liddell LLP is the proposed counsel for the
NV Debtors. Polsinelli Shughart PC is the proposed Delaware
counsel fpr the NV Debtors. The PBC Debtors selected Womble
Carlyle Sandridge & Rice, PLLC, as their counsel. Moelis &
Company is the proposed financial advisor and investment banker to
the Debtors. BMC Group Inc. is the Debtors' claims, noticing and
balloting agent.
OCCULOGIX INC: Existing Cash, Proceeds to Last Until End of 2009
----------------------------------------------------------------
Management believes OccuLogix Inc.'s existing cash as well as the
proceeds received from a July 15, 2009 convertible debt financing
will be sufficient to cover its operating and other cash demands
only until the end of December 2009, even if OccuLogix does not
successfully complete additional fund raising activities.
In a Form 10-Q filing with the Securities and Exchange Commission
in August, the Company said a successful transition to attaining
profitable operations is dependent upon obtaining additional
financing adequate to fund its planned expenses and achieving a
level of revenues adequate to support its cost structure. The
Company is seeking additional equity financing to support its
operations until it becomes cash flow positive. There can be no
assurances that there will be adequate financing available to the
Company on acceptable terms or at all. If the Company is unable
to obtain additional financing, the Company would need to
significantly curtail or reorient its operations during 2010,
which could have a material adverse effect on the Company's
ability to achieve its business objectives and as a result may
require the Company to file for bankruptcy or cease operations.
OccuLogix posted a net loss of $1,021,008 for the three months
ended June 30, 2009, from a net loss of $2,536,977 for the same
period a year ago. It recorded total revenue of $96,849 for the
three months ended June 30, 2009, from $127,200 the prior year.
The Company has sustained substantial losses of $14,181,433 for
the year ended December 31, 2008, and $2,023,599 and $4,814,050
for the six months ended June 30, 2009 and 2008, respectively.
The Company's working capital deficit at June 30, 2009, is
$835,022, which represents a $2,384,603 decrease in its working
capital from $1,549,581 at December 31, 2008.
As of June 30, 2009, the Company had $10,349,543 in total assets;
and total current liabilities of $1,793,951, deferred income tax
liability of $262,290, and contingently redeemable common stock of
$250,000. The Company had stockholders' equity of $8,043,302 and
accumulated deficit of $369,680,970.
As a result of the Company's history of losses and financial
condition, there is substantial doubt about the ability of the
Company to continue as a going concern.
As reported by the Troubled Company Reporter, the Company said
July 15, 2009, it had entered into and closed an agreement with
certain investors whereby the investors agreed to provide
financing to the Company through the purchase of convertible
secured notes, in the aggregate amount of $1.55 million.
A full-text copy of the Company's quarterly report on Form 10-Q is
available at no charge at http://ResearchArchives.com/t/s?445f
About OccuLogix
Headquartered in San Diego, California, OccuLogix, Inc.,
dba TearLab Corporation (NASDAQ:TEAR)(TSX:TLB) --
http://www.tearlab.com-- develops and commercializes lab-on-a-
chip technologies that enable eye care practitioners to improve
standard of care by quantitatively testing for disease markers in
tears at the point-of-care. TearLab is currently marketed
globally in more than 14 countries including the U.S.
OLD TIME POTTERY: Has Until Sept. 21 to File Schedules & Statement
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Tennessee
extended until Sept. 21, 2009, Old Time Pottery, Inc.'s time to
file its schedules of debts and property, statement of executory
contracts and statement of financial affairs.
Headquartered in Murfreesboro, Tennessee, Old Time Pottery, Inc.
operates a home decor retailer chain business. The Company filed
for Chapter 11 on Aug. 21, 2009 (Bankr. M.D. Tenn. Case No. 09-
09548). G. Rhea Bucy, Esq., Linda W. Knight, Esq., and Thomas H.
Forrester, Esq. at Gullett, Sanford, Robinson, Martin represent
the Debtor in its restructuring efforts. In its petition, the
Debtor listed $50,000,001 to $100,000,000 in assets and
$10,000,001 to $50,000,000 in debts.
OLD TIME POTTERY: Meeting of Creditors Scheduled for September 30
-----------------------------------------------------------------
The U.S. Trustee for Region 8 will convene a meeting of creditors
in Old Time Pottery, Inc's Chapter 11 case on Sept. 30, 2009, at
1:00 p.m. The meeting will be held at the Customs House, 701
Broadway, Room 100, Nashville, Tennessee.
This is the first meeting of creditors required under Section
341(a) of the Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
Headquartered in Murfreesboro, Tennessee, Old Time Pottery, Inc.
operates a home decor retailer chain business. The Company filed
for Chapter 11 on August 21, 2009 (Bankr. M.D. Tenn. Case No. 09-
09548). G. Rhea Bucy, Esq., Linda W. Knight, Esq., and Thomas H.
Forrester, Esq. at Gullett, Sanford, Robinson, Martin represent
the Debtor in its restructuring efforts. In its petition, the
Debtor listed $50,000,001 to $100,000,000 in assets and
$10,000,001 to $50,000,000 in debts.
OLD TIME POTTERY: U.S. Trustee Appoints 5-Member Creditors Panel
----------------------------------------------------------------
The U.S. Trustee for Region 8 appointed five members to the
official committee of unsecured creditors in the Chapter 11 cases
of in Old Time Pottery, Inc.
The Creditors Committee members are:
1. Global Houseware
Attn: Jackson Kam
28 Floor Soundwill Plaza
38 Russell Street
Causeway Bay, Hong Kong
Tel: 011-852-2-721-3683
2. Crystal Art of Florida, Inc.,
Attn: Randy Greenberg, president
3359 E. 50th Street
Vernon, CA 90058
Tel: (323) 581-6617
3. Northpoint Trading, Inc.
Attn: Jack Ezon, president
347 Fifth Avenue, Suite No. 201
New York, NY
Tel: (917) 257-5040
4. Dennis East International, LLC
Attn: Greg Bilezikian, president
231 Willow Street
Yarmouth Port, MA 02675
Tel: (508) 375-0009
5. Candle-lite
Attn: Ned Hoffman, credit manager
10521 Millington Court
Cincinnati, OH 45242
Tel: (513) 956-2349
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 Attnempt 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 Old Time Pottery, Inc.
Headquartered in Murfreesboro, Tennessee, Old Time Pottery, Inc.
operates a home decor retailer chain business. The Company filed
for Chapter 11 on Aug. 21, 2009 (Bankr. M.D. Tenn. Case No. 09-
09548.) G. Rhea Bucy, Esq., Linda W. Knight, Esq. and Thomas H.
Forrester, Esq., at Gullett, Sanford, Robinson, Martin represent
the Debtor in its restructuring efforts. In its petition, the
Debtor listed $50,000,001 to $100,000,000 in assets and
$10,000,001 to $50,000,000 in debts.
OLD TIME POTTERY: Wants Access to SunTrust Bank's Cash Collateral
-----------------------------------------------------------------
Old Time Pottery, Inc., asks the U.S. Bankruptcy Court for the
Middle District of Tennessee for authority to:
-- use cash securing repayment of loan with SunTrust Bank; and
-- grant replacement liens in the collateral other adequate
protection for the use of the cash collateral and any
diminution in value of SunTrust's prepetition collateral.
A hearing to consider the Debtors' use of cash collateral is
scheduled for Sept. 9, 2009, at 1:30 p.m. at Courtroom 2, 2nd
Floor Customs House, 701 Broadway Nashville Tennessee. Objections
were due on Sept. 8, 2009.
The Debtor has an immediate need to use cash collateral in order
to pay for the daily operating expenses at the stores.
As of Old Time Pottery's petition date, the principal and accrued
interest owed on the loan agreement was $18 million.
SunTrust asserted a first priority security interests in
substantially all of the assets of the Debtor, including
inventory, supplies, equipment and cash generated from the
operations
of the stores.
About Old Time Pottery, Inc.
Headquartered in Murfreesboro, Tennessee, Old Time Pottery, Inc.
operates a home decor retailer chain business. The Company filed
for Chapter 11 on Aug. 21, 2009 (Bankr. M.D. Tenn. Case No. 09-
09548). G. Rhea Bucy, Esq., Linda W. Knight, Esq., and Thomas H.
Forrester, Esq., at Gullett, Sanford, Robinson, Martin represent
the Debtor in its restructuring efforts. In its petition, the
Debtor listed $50,000,001 to $100,000,000 in assets and
$10,000,001 to $50,000,000 in debts.
OLD TIME POTTERY: Taps Gullet Sanford as Counsel
------------------------------------------------
Old Time Pottery Inc. asks the U.S. Bankruptcy Court for the
Middle District of Tennessee for permission to employ Gullett,
Sanford, Robinson & Martin, PLLC, as its counsel.
The firm has agreed to:
a) give the Debtor legal advice with respect to its powers and
duties as debtor-in-possession in the continued operation of
its business and management of its property, including
without limitation possible actions to avoid and to recover
preferences and other avoidable transfers;
b) prepare on behalf of the Debtor as debtor-in-possession
necessary applications, motions, orders, answers, reports,
and other legal documents for filing with this Court in
connection with the Chapter 11 Case;
c) consult with and advise the Debtor as to the status of
various contracts and leases, and the advisability of
Applicant's assumption or rejection of same;
d) consult with the Debtor respecting the formulation of a
Chapter 11 Plan, and the preparation and filing of such a
plan and disclosure statement under Chapter 11; and
e) perform all other legal services for the Debtor which may be
necessary and appropriate in its cases.
Customary hourly rates of firm's attorneys with GSR&M are:
Members $300-$425
Associates $150-$275
Paralegals $120
Linda W. Knight, Esq., a member of the firm, assures the Court
that the firm is a "disinterested person" as defined in Section
101(14) of the Bankruptcy Code.
Based in Murfreesboro, Tennessee, MOld Time Pottery Inc. operates
a home decor retailer chain business. The company filed for
Chapter 11 protection on Aug. 21, 2009 (Bankr. M.D. Ten. Case No.
09-09548). G. Rhea Bucy, Esq., Linda W. Knight, Esq., and Thomas
H. Forrester, Esq., Gullett Sanford Robinson & Martin, represent
the Debtor in its restructuring efforts. In its petition, the
Debtor listed assets between $50 million and $100 million, and
debts between $10 million and $50 million.
OSCIENT PHARMACEUTICALS: Antara Auctions on Sept. 21
----------------------------------------------------
Oscient Pharmaceuticals Corp. will be selling its Antara
cholesterol drug to Akrimax Pharmaceuticals LLC for $20 million
absent higher and better bids at a September 21 auction, Bill
Rochelle at Bloomberg News said.
The auction will be held if competing bids are received by
September 14. Oscient will seek the Bankruptcy Court's approval
of the sale to the highest bidder on September 21.
As reported by the Troubled Company Reporter on September 4,
Oscient won approval from the Bankruptcy Court to sell commercial
rights to antibiotic Factive to Cornerstone Therapeutics Inc.
Cornerstone agreed to pay $5,000,000 plus an amount for purchased
inventory.
About Oscient Pharmaceuticals
Based in Waltham, Massachusetts, Oscient Pharmaceuticals
Corporation (OSCIQ.PK) -- http://www.antararx.com/and
http://www.factive.com/-- markets two FDA-approved products in
the United States: ANTARA(R) (fenofibrate) capsules, a
cardiovascular product and FACTIVE(R) (gemifloxacin mesylate)
tablets, a fluoroquinolone antibiotic. ANTARA is indicated for
the adjunct treatment of hypercholesterolemia (high blood
cholesterol) and hypertriglyceridemia (high triglycerides) in
combination with diet. FACTIVE is approved for the treatment of
acute bacterial exacerbations of chronic bronchitis and community-
acquired pneumonia of mild to moderate severity. ANTARA accountsi
for over 80% of the Debtors' 2008 revenues. The Company also has
a late-stage antibiotic candidate, Ramoplanin, for the treatment
of Clostridium difficile-associated disease.
As of December 31, 2008, Oscient's audited consolidated financial
statements reflected total assets of $174 million and total
liabilities of $255 million.
Oscient Pharmaceuticals together with an affiliate filed for
Chapter 11 on July 13, 2009 (Bankr. D. Mass. Case No. 09-16576).
Judge Henry J. Boroff presides over the case. Charles A. Dale
III, Esq., at K&L Gates LLP, represents the Debtors. The Debtors
also hired Ropes & Gray LLP as special litigation counsel, and
Broadpoint Capital Inc. as financial advisor. In its petition,
Oscient listed assets ranging from $50,000,001 to $100,000,000,
and debts ranging from $100,000,001 to $500,000,000.
PHARMACEUTICAL ALTERNATIVES: Court Dismisses Check Lawsuit
----------------------------------------------------------
Kathie Dickerson at Coshocton Tribune reports that the Coshocton
County Common Pleas Court has dismissed a lawsuit against
Pharmaceutical Alternatives, Inc., for allegedly writing a check
for $8,415 that wouldn't be honored by the bank.
Coshocton Tribune says that the case was scheduled for jury trial
on Friday.
According to Coshocton Tribune, MedSearch Staffing Services sued
Pharmaceutical Alternatives on June 30, 2008, seeking payment of
the amount the check was to have covered, plus 8 percent annual
interest, plus attorney fees and court costs, which amounted to
$16,830, for a total judgment of $25,245. Coshocton Tribune
states that Pharmaceutical Alternatives was doing business as
Miller Pharmacy.
Coshocton Tribune relates that Jennifer Monty at Weltman, Weinberg
and Reis Co., which represents MedSearch Staffing Services, then
filed a motion to dismiss the case. The report quoted Bob
Skelton, Pharmaceutical Alternatives' lawyer, as saying, "They had
been paid for more than a year."
Court documents say that Pharmaceutical Alternatives denied doing
business as Miller Pharmacy. According to Coshocton Tribune,
Pharmaceutical Alternatives and Miller Pharmacy share the same
address for a principal office location at 234 Main St.
Filings available at the Ohio Secretary of State's Web site say
that Miller Pharmacy has been incorporated since 1956 and Barbara
Miller is listed as having sole proprietorship of the independent
retail pharmacy. Pharmaceutical Alternatives, Inc., was
incorporated in 1987 and B. Elise Miller is listed as the sole
incorporator.
As reported by the TCR on September 2, 2009, the U.S. Department
of Labor was suing Pharmaceutical Alternatives Ms. Miller for
allegedly using employees' retirement contributions for the
benefit of the Company. Ms. Miller withheld the contributions or
failed to remit them from August 5, 2005, to January 16, 2009.
The Department of Labor was seeking to recover all the assets owed
to the retirement plan.
Coshocton, Ohio-based Pharmaceutical Alternatives, Inc. --
http://www.pharmaceuticalalternatives.com/-- sells food
supplements. Pharmaceutical Alternatives is the parent company of
Three Rivers Infusion and Pharmacy Specialists.
As reported in the Troubled Company Reporter on November 11, 2008,
Pharmaceutical Alternatives -- dba Three Rivers Infusion and
Pharmacy Specialists, Three Rivers Option Care, Midwest Infusion
Services, and Holzier Infusion Services -- filed for Chapter 11
protection on November 5, 2008 (Bankr. S.D. Ohio Case No. 08-
60905).
PHILADELPHIA NEWSPAPERS: Hearing on Ads Controversy Today
---------------------------------------------------------
Philadelphia Newspapers LLC will appear before the Bankruptcy
Court today to defend itself against a motion by the Official
Committee of Unsecured Creditors to halt the publisher of the
Philadelphia Inquirer and Philadelphia Daily News from continuing
the "Keep It Local" advertising campaign designed to drum up
support for selling the business to a group of insiders including
Bruce E. Toll, vice chairman of homebuilder Toll Brothers Inc.
Philadelphia Newspapers quickly went on record saying the
Committee's motion raises "serious issues" regarding the
constitutionality of prohibiting an advertising campaign.
As reported by the Troubled Company Reporter on September 1, 2009,
the Creditors Committee, represented by O'Melveny & Myers LLP,
said that Philadelphia Newspapers' using of its own pages to tout
its reorganization plan was "highly inappropriate" and describe
the move as a publicity campaign in favor of the sale to the
stalking-horse bidder [a group of local investors led by
homebuilder Bruce Toll]". The group is offering to pump $35
million in cash into Philadelphia Newspapers and fund a $17
million letter of credit.
The official committee of unsecured creditors said in court
documents that the public relations campaign is an inappropriate
use of company resources "meant to demonize 'out-of-town' buyers"
and favor corporate insiders.
About Philadelphia Newspapers
Philadelphia Newspapers -- http://www.philly.com/-- owns and
operates numerous print and online publications in the
Philadelphia market, including the Philadelphia Inquirer, the
Philadelphia Daily News, several community newspapers, the
region's number one local Web site, philly.com, and a number of
related online products. The Company's flagship publications are
the Inquirer, the third oldest newspaper in the country and the
winner of numerous Pulitzer Prizes and other journalistic
recognitions, and the Daily News.
Philadelphia Newspapers and its debtor-affiliates filed for
Chapter 11 bankruptcy protection on February 22, 2008 (Bankr. E.D.
Pa. Case No. 09-11204). Proskauer Rose LLP is the Debtors'
bankruptcy counsel, while Lawrence G. McMichael, Esq., at Dilworth
Paxson LLP is the local counsel. The Debtors' financial advisor
is Jefferies & Company Inc. The Garden City Group, Inc. serves as
claims and notice agent. Philadelphia Newspapers listed assets
and debts of $100 million to $500 million in its bankruptcy
petition.
PHILADELPHIA NEWSPAPERS: Sues Review Publishing to Collect Payment
------------------------------------------------------------------
According to John P. Connolly at The Bulletin, in Pennsylvania,
Philadelphia Newspapers LLC has commenced an adversary proceeding
against Review Publishing, alleging that the latter has refused to
pay over $530,000 that it owes for printing services.
Philadelphia Newspapers, The Bulletin report relates, says that it
is party to a 2003 agreement with Review Publishing under which it
agreed to print and distribute Review's publications, which
include Philadelphia Weekly, South Philly Review, Southwest Philly
Review, and Atlantic City Weekly. According to Philadelphia
Newspapers, since the renewal of the deal in March, Review
Publishing has refused to provide payment.
Meanwhile, Philadelphia Newspapers has obtained a November 2
extension of its exclusive period to file a Chapter 11 plan.
The Debtor has already reached an agreement with creditors for a
$15 million debtor-in-possession loan to continue operations.
Citizens Bank, a senior lender to the Company, will provide
funding for the loan.
About Philadelphia Newspapers
Philadelphia Newspapers -- http://www.philly.com/-- owns and
operates numerous print and online publications in the
Philadelphia market, including the Philadelphia Inquirer, the
Philadelphia Daily News, several community newspapers, the
region's number one local Web site, philly.com, and a number of
related online products. The Company's flagship publications are
the Inquirer, the third oldest newspaper in the country and the
winner of numerous Pulitzer Prizes and other journalistic
recognitions, and the Daily News.
Philadelphia Newspapers and its debtor-affiliates filed for
Chapter 11 bankruptcy protection on February 22, 2008 (Bankr. E.D.
Pa. Case No. 09-11204). Proskauer Rose LLP is the Debtors'
bankruptcy counsel, while Lawrence G. McMichael, Esq., at Dilworth
Paxson LLP is the local counsel. The Debtors' financial advisor
is Jefferies & Company Inc. The Garden City Group, Inc. serves as
claims and notice agent. Philadelphia Newspapers listed assets
and debts of $100 million to $500 million in its bankruptcy
petition.
PILGRIM'S PRIDE: In Talks of Selling Biz. to JBS SA, Says Report
----------------------------------------------------------------
JBS SA, the world's largest beef exporter, is in talks in buying
U.S.-based chicken producer Pilgrim's Pride Corporation out from
bankruptcy, the Wall Street Journal reported on September 3, 2009.
JBS, however, issued a statement on the same day saying there is
no transaction or firm commitment by the company "at this time."
The deal, valued by the Journal at $2.5 billion, is set to be
announced in a matter of weeks, the newspaper said citing people
familiar with the talks. Analysts opined that the deal would pull
Pilgrim's Pride out from bankruptcy and would make its presence
felt in the global meat market. If the deal closes, it will pay
bank Pilgrim's lenders, bondholders and other unsecured creditors
in full, and still leave enough money for shareholders, the
Journal said.
At the close of trading on September 3, 2009, Pilgrim's Pride
shares closed up 27 cents, or 5.24%, at $5.42 in Pink Sheet
trading, while JBS shares were up 14 cents, or 1.8%, at $7.87,
Reuters reported.
About Pilgrim's Pride
Headquartered in Pittsburgh, Texas, Pilgrim's Pride Corporation
(Pink Sheets: PGPDQ) -- http://www.pilgrimspride.com/-- employs
roughly 41,000 people and operates chicken processing plants and
prepared-foods facilities in 14 states, Puerto Rico and Mexico.
The Company's primary distribution is through retailers and
foodservice distributors.
Pilgrim's Pride Corp. and six other affiliates filed Chapter 11
petitions on December 1, 2008 (Bankr. N.D. Tex. Lead Case No.
08-45664). The Debtors' operations in Mexico and certain
operations in the United States were not included in the filing
and continue to operate as usual outside of the Chapter 11
process.
Pilgrim's Pride has engaged Stephen A. Youngman, Esq., Martin A.
Sosland, Esq., and Gary T. Holzer, Esq., at Weil, Gotshal & Manges
LLP, as bankruptcy counsel. The Debtors have also tapped Baker &
McKenzie LLP as special counsel. Lazard Freres & Co., LLC, is the
company's investment bankers and William K. Snyder of CRG Partners
Group LLC as chief restructuring officer. The Company's claims
and noticing agent is Kurtzman Carson Consulting LLC.
A nine-member committee of unsecured creditors has been appointed
in the case.
As of December 27, 2008, the Company had $3,215,103,000 in total
assets, $612,682,000 in total current liabilities, $225,991,000 in
total long-term debt and other liabilities, and $2,253,391,000 in
liabilities subject to compromise.
Bankruptcy Creditors' Service, Inc., publishes Pilgrim's Pride
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
of Pilgrim's Pride Corp. and its various affiliates.
About JBS SA
JBS SA is one of the world's largest beef producers with
operations in Brazil, the United States, Argentina, Australia and
Italy. The company is the largest producer and exporter of fresh
meat and meat by-products in Brazil, Argentina and Australian and
the third largest in the USA.
* * *
As of June 17, 2009, the company continues to carry Moody's B1 LT
Corp rating and B1 Senior Unsecured Debt rating. The company also
continues to carry Standard and Poors LT issuer Credit ratings B+.
PILGRIM'S PRIDE: Seeks Exclusivity Extension; Mum on JSB Talks
--------------------------------------------------------------
Pilgrim's Pride Corp. and its affiliates ask the Bankruptcy Court
for a December 31 extension of their exclusive right to propose a
Chapter 11 plan.
Bill Rochelle at Bloomberg points out that the motion didn't
address news reports that Brazil's JSB SA is negotiating to buy
the company. JSB is the world's largest beef producer.
The Debtors say they are in the final stages of developing a plan
of reorganization and expect to file it with the Court by
September 30, 2009, and emerge from chapter 11 by December 31,
2009. The
Debtors believe that their plan of reorganization will garner the
support of all stakeholders.
About Pilgrim's Pride
Headquartered in Pittsburgh, Texas, Pilgrim's Pride Corporation
(Pink Sheets: PGPDQ) -- http://www.pilgrimspride.com/-- employs
roughly 41,000 people and operates chicken processing plants and
prepared-foods facilities in 14 states, Puerto Rico and Mexico.
The Company's primary distribution is through retailers and
foodservice distributors.
Pilgrim's Pride Corp. and six other affiliates filed Chapter 11
petitions on December 1, 2008 (Bankr. N.D. Tex. Lead Case No.
08-45664). The Debtors' operations in Mexico and certain
operations in the United States were not included in the filing
and continue to operate as usual outside of the Chapter 11
process.
Pilgrim's Pride has engaged Stephen A. Youngman, Esq., Martin A.
Sosland, Esq., and Gary T. Holzer, Esq., at Weil, Gotshal & Manges
LLP, as bankruptcy counsel. The Debtors have also tapped Baker &
McKenzie LLP as special counsel. Lazard Freres & Co., LLC, is the
company's investment bankers and William K. Snyder of CRG Partners
Group LLC as chief restructuring officer. The Company's claims
and noticing agent is Kurtzman Carson Consulting LLC.
A nine-member committee of unsecured creditors has been appointed
in the case.
As of December 27, 2008, the Company had $3,215,103,000 in total
assets, $612,682,000 in total current liabilities, $225,991,000 in
total long-term debt and other liabilities, and $2,253,391,000 in
liabilities subject to compromise.
Bankruptcy Creditors' Service, Inc., publishes Pilgrim's Pride
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
of Pilgrim's Pride Corp. and its various affiliates.
POLAROID CORP: To Auction Off Collection of Instant Images
----------------------------------------------------------
According to The Boston Herald, Polaroid Corp. recently obtained
approval from the Bankruptcy Court to hire the Sotheby's auction
house in New York to unload its 16,000-piece collection, starting
with an auction by June 2010 of a select group of the most
valuable images.
The report relates that the bankruptcy judge denied a request by a
group of photographers for a delay in the asset sale, which may
break up the collection. The group failed to convince the judge
that they own the images.
Greg Turner at The Boston Herald notes that at the delight of
photographers and historians, Polaroid, in its 2001 bankruptcy
case, wasn't required to auction off its precious Polaroids, a
collection of thousands of one-of-a-kind prints by hundreds of
photographers ranging from Ansel Adams to Andy Warhol.
The Company's operating assets, including the Polaroid brand, has
been sold for $86 million to a joint venture that includes Gordon
Brothers Group.
About Polaroid Corporation
Polaroid Corporation -- http://www.polaroid.com/-- makes and
sells films, cameras, and other imaging products.
Polaroid Corp., together with 11 affiliates, filed voluntary
petitions for Chapter 11 on December 18, 2008 (Bankr. D.
Minn., Lead Case No. 08-46617). Judge Gregory F. Kishel handles
the Chapter 22 case. George H. Singer, Esq., James A. Lodoen,
Esq., and Sandra S. Smalley-Fleming, Esq., at Lindquist & Vennum
P.L.L.P, are counsel to the Debtors. Cass Weil, Esq., James A.
Rubenstein, Esq., and Sarah E. Doerr, Esq., at Moss & Barnett,
have been tapped as special counsel. The law firms of Baker &
McKenzie and C&A Law represent the Debtors as special foreign
legal counsel. Paul Hastings, Janofsky & Walker LLP, and Faegre &
Benson LLP represent the Committee.
According to the Company, the financial structuring process and
the bankruptcy filing are the result of events at Petters
Group Worldwide, which has owned Polaroid since 2005.
This was the Company's second bankruptcy filing. The Company
first filed for bankruptcy on October 12, 2001 (Bankr. D. Del.
Lead Case No. 01-10864).
RATHGIBSON INC: Offers to Pay Potential Lenders' Expenses
---------------------------------------------------------
According to Bill Rochelle at Bloomberg News, RathGibson Inc.
seeks approval from the Bankruptcy Court to pay up to $300,000 in
expenses by potential lenders who may provide financing to exit
Chapter 11. Although no loan commitments are yet in hand, the
company says it has received "several proposals."
Judge Christopher Sontchi in late August held that the disclosure
statement submitted by RathGibson Inc. contains adequate
information necessary for creditors to make an informed judgment
on the proposed reorganization plan.
RathGibson was scheduled to mail solicitation packages to
creditors entitled to vote on the Plan by September 4. Ballots
must be returned by September 29.
The Court will begin hearings to consider confirmation of the Plan
on October 9. Objections to confirmation are due September 29.
RathGibson negotiated the terms of its reorganization plan with
lenders prepetition. Prior to filing, RathGibson and subsidiary
Greenville Tube Company entered into a Plan Support Agreement,
dated as of July 13, 2009, with holders of in excess of 73% of its
11.25% Senior Notes due 2014.
Terms of the Plan
Pursuant to the Plan, RathGibson's existing indebtedness in
respect of Senior Notes Claims in Class 4 -- estimated at
$209.2 million -- and Senior Note Guaranty Claims in Class 8 will
be cancelled and exchanged for New Common Stock in Reorganized
RathGibson, subject to dilution. The Plan provides a 7% recovery
for Senior Notes Claims and Senior Note Guaranty Claims.
The New Common Stock will not be registered with the SEC or any
state securities regulatory authority and will not trade on any
exchange, or otherwise be publicly traded. Reorganized RathGibson
will retain its Interests in Greenville.
Holders of Allowed Prepetition Secured Credit Agreement Claims,
estimated at $53.35 million, will be paid in full in cash.
Holders of Allowed General Unsecured Claim against RathGibson --
estimated at $13.1 million -- and Allowed General Unsecured Claim
against Greenville -- estimated at $2.0 million -- will receive
payment in full in Cash.
Holders of Existing Rath Securities Laws Claims in Class 6,
Existing Rath Interests in Class 7 and Existing Greenville
Securities Laws Claims in Class 10 get nothing.
The Debtors anticipate that the Plan Effective Date will occur
prior to November 10, 2009.
The Debtors intend to raise funds to satisfy certain payment
obligations under the Plan and the liquidity needs of the
Reorganized Debtors through the issuance, by Reorganized
RathGibson, of rights to acquire shares of New Common Stock
pursuant to the Rights Offering. The Rights Offering is expected
to generate proceeds of up to $60 million. The Debtors will enter
into agreements with certain consenting Noteholders to backstop
the Rights Offering and buy unsold shares.
The aggregate value of the New Common Stock is estimated at
$78.4 million based on the $105.0 million midpoint of the
estimated total enterprise value of the Reorganized Debtors, less
the estimated face amount of the Reorganized Debtors' net debt as
of the Effective Date of roughly $26.6 million.
The Debtors expect that an aggregate of 10,000,000 shares of New
Common Stock will be issued under the Plan. Based on the
preceding estimate, immediately after the consummation of the
Plan, the ownership of Reorganized RathGibson will be:
Shares of
New Common Stock Percent Ownership
---------------- -----------------
Class 4 [___]%
[___]%
DIP Lenders 7.5%
Backstop Equity Investors 5% or 7.5%
-----------
Total 100.0%
A full-text copy of the Joint Plan is available at no charge at:
http://ResearchArchives.com/t/s?3f58
A full-text copy of the Disclosure Statement is available at no
charge at http://ResearchArchives.com/t/s?3f57
A full-text copy of the Plan Support Agreement is available at no
charge at http://ResearchArchives.com/t/s?3f59
Debtor RGCH Holdings Corp., the parent company of RathGibson, and
RG Tube Holdings LLC, the ultimate parent, are not proponents of
the Plan. The Plan will result in the deconsolidation of
RathGibson and Greenville from the RG Tube U.S. consolidated
group.
About RathGibson Inc.
Based in Lincolnshire, Illinois, RathGibson Inc. --
http://www.RathGibson.com/, http://www.GreenvilleTube.com/and
http://www.ControlLine.com/-- is a worldwide manufacturer of
highly engineered stainless steel, nickel, and titanium tubing for
diverse industries such as chemical, petrochemical, energy --
power generation, energy -- oil and gas, food, beverage,
pharmaceutical, biopharmaceutical, medical, biotechnology, and
general commercial.
Manufacturing locations include: Janesville, Wisconsin, North
Branch, New Jersey, Clarksville, Arkansas (Greenville Tube), and
Marrero, Louisiana (Mid-South Control Line). In addition to the
sales offices in Janesville, North Branch, and Marrero, RathGibson
has also strategically placed sales offices in Houston, Texas,
USA; Shanghai, China; Manama, Bahrain; Melbourne, Australia;
Seoul, Republic of Korea; Mumbai, India; Singapore; Vienna,
Austria; and Buenos Aires, Argentina.
RathGibson, Inc., together with three affiliates, filed for
Chapter 11 on June 13, 2009 (Bankr. D. Del. Case No. 09-12452).
Attorneys at Young, Conaway, Stargatt & Taylor and Willkie Farr &
Gallagher LLP serve as co-counsel. Jefferies & Company Inc. and
Mesirow Financial Consulting LLC have been hired as financial
advisors. Kelley Drye & Warren LLP serves as special corporate
counsel. Garden City Group is claims and notice agent. The
petition says that Rathgibson has assets and debts of $100 million
to $500 million.
Scott Welkis, Esq., Kristopher M. Hansen, Esq., and Jayme T.
Goldstein, Esq., at Stroock & Stroock & Lavan represent Wilmington
Trust FSB, as administrative agent, and an ad hoc committee of
certain holders of Senior Notes. Attorneys at Richards, Layton &
Finger P.A., also represent the ad hoc noteholders committee.
READER'S DIGEST: Proposes CMP as Conflicts Counsel
--------------------------------------------------
The Reader's Digest Association LLC and its affiliates seek the
Court's authority to employ Curtis, Mallet-Prevost, Colt & Mosle
LLP as conflicts counsel, nunc pro tunc to the Petition Date,
under a general retainer and pursuant to the parties' engagement
letter dated as of July 30, 2009.
As conflicts counsel, CMP has agreed to, 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 businesses and properties;
(b) attend meetings and negotiate with representatives of
creditors and other parties-in-interest;
(c) take necessary action to protect and preserve the Debtors'
bankruptcy estates, including prosecuting actions on the
Debtors' behalf, defending any action commenced against
the Debtors and representing the Debtors' interests in
negotiations concerning litigation in which the Debtors
are involved;
(d) prepare motions, applications, answers, orders, appeals,
reports and papers necessary to the administration of the
estates;
(e) take any necessary action on behalf of the Debtors to
obtain approval of a disclosure statement and confirmation
of one or more Chapter 11 plans of reorganization;
(f) represent the Debtors in connection with obtaining
postpetition financing;
(g) advise the Debtors in connection with any potential sale
of assets;
(h) appear before the Court, any appellate courts and the
United States Trustee, and protect the interests of the
estates before those Courts and the United States Trustee;
(i) consult with the Debtors regarding tax matters; and
(j) perform other necessary legal services and provide other
necessary legal advice to the Debtors in connection with
the bankruptcy cases.
CMP will be paid in its current hourly rates, and will be
reimbursed of its necessary expenses. CMP's current hourly rates:
Professional Hourly Rate
------------ -----------
Partners $675 - $785
Counsel $525 - $595
Associates $290 - $575
Paraprofessionals $170 - $210
Managing clerks $415
Support personnel $55 - $325
Steven J. Reisman, Esq., a partner at CMP, assures the Court that
his firm is a "disinterested person," as defined in Section
101(14) of the Bankruptcy Code.
About The Reader's Digest Association
RDA is a global multi-brand media and marketing company that
educates, entertains and connects audiences around the world. The
company builds multi-platform communities based on branded
content. With offices in 44 countries, it markets books,
magazines, and music, video and educational products reaching a
customer base of 130 million in 78 countries. It publishes 94
magazines, including 50 editions of Reader's Digest, the world's
largest-circulation magazine, operates 65 branded Web sites
generating 22 million unique visitors per month, and sells
40 million books, music and video products across the world each
year. Its global headquarters are in Pleasantville, N.Y.
Reader's Digest said that as of June 30, 2009, it had total assets
of $2.2 billion against total debts of $3.4 billion.
Reader's Digest, together with its 47 affiliates, filed for
Chapter 11 on August 24 (Bankr. S.D.N.Y. Case No. 09-23529).
Kirkland & Ellis LLP has been engaged as general restructuring
counsel. Mallet-Prevost, Colt & Mosle LLP has been tapped as
conflicts counsel. Ernst & Young LLP is auditor. Miller Buckfire
& Co, LLC, is financial advisor. AlixPartners, LLC, is
restructuring consultant. Kurtzman Carson Consultants is notice
and claims agent.
Bankruptcy Creditors' Service, Inc., publishes Reader's Digest
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Reader's Digest and its affiliates
(http://bankrupt.com/newsstand/or 215/945-7000)
READER'S DIGEST: Wants to Employ Miller Buckfire as Advisor
-----------------------------------------------------------
Since February 28, 2009, The Reader's Digest Association LLC and
its affiliates retained Miller Buckfire & Co., LLC, as their
financial advisor and investment banker pursuant to an engagement
letter, dated February 28, 2009, and amended July 30, 2009.
Miller Buckfire has familiarized itself with the assets and
operations of the Debtors, analyzed the Debtors' current liquidity
and projected cash flows, and examined and sought to implement
potential strategic alternatives to de-leverage the Debtors'
balance sheet, among other services.
In providing professional services to the Debtors, Miller Buckfire
has worked closely with the Debtors' officers and management and
has become well-acquainted with the Debtors' businesses, capital
structure, financial affairs and related matters, relates Thomas
A. Williams, Reader's Digest's chief financial officer and senior
vice president. He asserts that the experience Miller Buckfire
gained before the Petition Date will facilitate the provision of
the services required by the Debtors in the Chapter 11 cases.
Therefore, the Debtors seek the Court's permission to employ
Miller Buckfire as their financial advisor and investment banker,
nunc pro tunc to the Petition Date, according to the Engagement
Letter.
As advisor and banker, Miller Buckfire has agreed to:
(a) review and analyze the Debtors' business, operations and
financial projections;
(b) provide financial and valuation advice and assistance to
the Debtors in developing and seeking approval of a
restructuring plan under the Bankruptcy Code;
(c) advise and assist the Debtors in structuring any new
securities to be issued under a restructuring plan;
(d) assist in the development and preparation of a memorandum
to be used in soliciting potential investors, if requested
by the Debtors;
(e) assist with and participate in negotiations with potential
investors and entities or groups affected by a
restructuring plan;
(f) advise and assist the Debtors in the potential sale of
CompassLearning, Inc., and any other non-core assets;
(g) assist the Debtors with administrative obligations arising
out the Chapter 11 filing, including preparing management
for any organizational or ongoing meetings of creditors;
and
(h) participate in hearings, as necessary.
The Debtors will compensate Miller Buckfire in accordance with the
terms and conditions of the Engagement Letter, which provides in
relevant part for this compensation structure:
(a) Monthly Fees. A Monthly Advisory Fee of $200,000, 50% of
which will be credited against any Completion Fee;
(b) Financing Fee. Financing fees in accordance with this
schedule:
-- 1% of the gross proceeds of any indebtedness issued
that is secured by a first lien;
-- 3% of the gross proceeds of any indebtedness issued
that:
* is secured by a second or more junior lien;
* is unsecured; and
* is subordinate; and
-- 5% of the gross proceeds of any equity or equity-linked
securities or obligations issued;
provided that (i) in each case, no Financing Fee will be
payable in respect of any proceeds actually funded by the
Debtors' prepetition shareholders, and (ii) a DIP
Financing Fee of $1,500,000 paid prior to the Petition
Date will be credited against any Financing Fee payable in
respect of any Financing raised in an "exit" Financing;
(c) Completion Fee. A Completion Fee of $3,750,000, payable
upon consummation of a Restructuring or Comprehensive
Sale;
(d) Partial Sale Fee. A Partial Sale fee of $500,000 in
respect of the sale of the Debtors' CompassLearning, Inc.
business; and
(e) Reimbursement of Expenses. In addition to the fees, and
regardless of whether any transaction occurs, the Debtors
will promptly reimburse Miller Buckfire on a monthly basis
for travel and other reasonable out-of-pocket expenses
incurred in connection with its activities under the
Engagement Letter.
The Debtors have agreed to indemnify and to make certain
contributions to Miller Buckfire in accordance with the
indemnification provisions set forth in the Engagement Letter.
The Debtors note that the indemnification provisions reflected in
the Engagement Letter are customary and reasonable terms of
consideration for financial advisors and investment bankers like
Miller Buckfire for proceedings both out of court and in Chapter
11.
Jeffrey E. Finger, a director of Miller Buckfire, assures the
Court that his firm is a "disinterested person" within the meaning
of Section 101(14) of the Bankruptcy Code.
About The Reader's Digest Association
RDA is a global multi-brand media and marketing company that
educates, entertains and connects audiences around the world. The
company builds multi-platform communities based on branded
content. With offices in 44 countries, it markets books,
magazines, and music, video and educational products reaching a
customer base of 130 million in 78 countries. It publishes 94
magazines, including 50 editions of Reader's Digest, the world's
largest-circulation magazine, operates 65 branded Web sites
generating 22 million unique visitors per month, and sells
40 million books, music and video products across the world each
year. Its global headquarters are in Pleasantville, N.Y.
Reader's Digest said that as of June 30, 2009, it had total assets
of $2.2 billion against total debts of $3.4 billion.
Reader's Digest, together with its 47 affiliates, filed for
Chapter 11 on August 24 (Bankr. S.D.N.Y. Case No. 09-23529).
Kirkland & Ellis LLP has been engaged as general restructuring
counsel. Mallet-Prevost, Colt & Mosle LLP has been tapped as
conflicts counsel. Ernst & Young LLP is auditor. Miller Buckfire
& Co, LLC, is financial advisor. AlixPartners, LLC, is
restructuring consultant. Kurtzman Carson Consultants is notice
and claims agent.
Bankruptcy Creditors' Service, Inc., publishes Reader's Digest
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Reader's Digest and its affiliates
(http://bankrupt.com/newsstand/or 215/945-7000)
READER'S DIGEST: Proposes to Reject 8 Non-Residential Leases
------------------------------------------------------------
The Reader's Digest Association LLC and its affiliates seek the
Court's permission to reject eight unexpired leases and subleases
of nonresidential real property and abandon related personal
property:
Lease
Debtor/Party Counterparty Expiration Date
------------ ------------ ---------------
WRC Media, Inc. 500-512 Seventh June 30, 2015
Avenue L.P.
RDA Sub Co. Aurora - Old June 30, 2013
Orchard LLC, et al.
Direct Holdings Cavalier Telephone LLC Dec. 31, 2011
Customer Service Inc.
Direct Holdings LIT Industrial L.P. Dec. 31, 2011
Customer Service Inc.
The Reader's Digest Norfield Realty Corp. June 30, 2010
Association, Inc.
Reader's Digest Regus Management Sep. 30, 2010
Latinoamerica, S.A. Group LLC
Reader's Digest Rhode Island & M Oct. 31, 2013
Association, Inc. Associates
Weekly Reader River Bend Executive Aug. 31, 2017
Corporation Center, Inc.
As of the Petition Date, the Debtors were tenants under 23
nonresidential real property leases across 14 states. Generally,
the Debtors do not own the property from which they conduct their
operations. Instead, the Debtors lease nonresidential real
property, some of which has subsequently been subleased to third
parties.
Prior to the Petition Date, the Debtors began the process of
reviewing and analyzing all of their contractual obligations so as
to identify contracts and leases that are burdensome to their
bankruptcy estates, and may be rejected pursuant to Section 365 of
the Bankruptcy Code. To date, the Debtors have identified the
eight Leases, including one sublease, that are not integral to the
Debtors' ongoing business operations and represent an unnecessary
expense to the estates.
Indeed, each of the properties underlying the Leases is currently
vacant, and the Debtors have determined that the annual cost to
the Debtors to lease the Properties is approximately $3,650,000,
net of sublease income, relates James H.M. Sprayregen P.C., Esq.,
at Kirkland & Ellis LLP, in New York.
Accordingly, in an effort to reduce postpetition administrative
costs, the Debtors believe that the rejection of the Leases,
effective as of August 28, 2009, is in the best interests of the
Debtors, their estates and their creditors. Moreover, the Debtors
will continue to evaluate their remaining leases of nonresidential
real property to maximize the value of their estates.
About The Reader's Digest Association
RDA is a global multi-brand media and marketing company that
educates, entertains and connects audiences around the world. The
company builds multi-platform communities based on branded
content. With offices in 44 countries, it markets books,
magazines, and music, video and educational products reaching a
customer base of 130 million in 78 countries. It publishes 94
magazines, including 50 editions of Reader's Digest, the world's
largest-circulation magazine, operates 65 branded Web sites
generating 22 million unique visitors per month, and sells
40 million books, music and video products across the world each
year. Its global headquarters are in Pleasantville, N.Y.
Reader's Digest said that as of June 30, 2009, it had total assets
of $2.2 billion against total debts of $3.4 billion.
Reader's Digest, together with its 47 affiliates, filed for
Chapter 11 on August 24 (Bankr. S.D.N.Y. Case No. 09-23529).
Kirkland & Ellis LLP has been engaged as general restructuring
counsel. Mallet-Prevost, Colt & Mosle LLP has been tapped as
conflicts counsel. Ernst & Young LLP is auditor. Miller Buckfire
& Co, LLC, is financial advisor. AlixPartners, LLC, is
restructuring consultant. Kurtzman Carson Consultants is notice
and claims agent.
Bankruptcy Creditors' Service, Inc., publishes Reader's Digest
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Reader's Digest and its affiliates
(http://bankrupt.com/newsstand/or 215/945-7000)
SARATOGA RESOURCES: Proved Reserves Top $500 Million
----------------------------------------------------
Saratoga Resources, Inc., announced further increases to its
reserve base, resulting from a supplement to its July 1, 2009
reserve evaluation, and completion and commencement of production
from the GPLD A-191 well in Grand Bay Field.
Collarini Associates, the Company's independent reserve engineers,
estimated Saratoga's net proved reserves, as of July 1, 2009 using
June 30, 2009 NYMEX strip pricing and Society of Petroleum
Engineering methodology, to be 7.9 million barrels of oil and 69.2
billion cubic feet of gas, or 116.6 billion cubic feet of gas
equivalent, with a net present value of future cash flow,
discounted at 10%, of $510 million. Proved developed producing
reserves are 2.2 MMBO and 4.5 BCFG, or 17.7 BCFE with PV10 of
$78.9 million. July 1, 2009 reserve totals do not include reserves
added as a result of the completion of the GPLD A-191 well. The
GPLD A-191 well is expected to add 216 thousand barrels of oil
and 107 million cubic feet of gas to the Company's PDP reserves,
with PV10 of $10.1 million, assuming June 30, 2009 NYMEX strip
pricing.
Saratoga has a development inventory of 71 proved developed non-
producing and 72 proved undeveloped opportunities, as of July 1,
2009. In addition, the Company's independently audited probable
reserves are 3.3 MMBO and 45.1 BCFG, or 64.8 BCFE, with PV10 of
$209 million, and possible reserves of 12.4 MMBO and 104.0 BCFG,
or 178.5 BCFE, with PV10 of $353 million. In summary, Saratoga's
3P net reserves (excluding reserves attributable to completion of
the GPLD A-191) amount to 359.8 BCFE with PV10 of $1,072 million.
The GPLD A-191/191D well in Grand Bay Field was recently completed
as a dual completion and filed with the State of Louisiana on
September 8, 2009. The long string (completed in the 13A and 13B
reservoirs) was opened on August 29, 2009, and unloaded and
stabilized on a 12/64" choke. The well initial production rate
was recorded on August 31, 2009, at 1899 thousand cubic feet of
gas per day, 95 barrels of oil per day (and 9 barrels of water per
day with 2000 psi flowing tubing pressure. The short string was
then unloaded and put on line September 2, 2009. The IP rate on
the 10B reservoir was recorded at 1624 MCFGPD, 23 BOPD and 68 BWPD
with 910 psi FTP on an 18/64" choke. The combined rate for the
well is 3523 MCFGPD, 118 BOPD and 77 BWPD, equivalent to 705
barrels of oil equivalent per day.
Thomas F. Cooke, Saratoga's Chairman/CEO, said, "The Company
decided to do a supplement to its July 1, 2009 reserve report
because of the high volume of new reserves attributable to the
ongoing full field studies and internal analysis, especially at
Grand Bay and Vermilion 16 fields."
About Saratoga Resources
Saratoga Resources Inc. (OTCBB: SROEQ) is an independent
exploration and production company with offices in Houston and
Covington. Saratoga engages in the acquisition and development of
oil and gas producing properties that allow the Company to grow
through low-risk development and risk-managed exploration.
Saratoga operates 14 fields in Louisiana and Texas with 106 active
producing wells. Current net production is approximately 3,000
barrels of oil equivalent per day -- BOEPD -- with 70% oil versus
gas. Principal holdings cover 37,756 gross (34,246 net) acres,
mostly held-by-production, located in the state waters offshore
Louisiana.
Saratoga Resources, Inc., and certain operating subsidiaries filed
on March 31, 2009, voluntary Chapter 11 petitions in the U.S.
Bankruptcy Court for the Western District of Louisiana in
Lafayette, Louisiana. Saratoga is being advised by its legal
counsel, Adams & Reese LLP; its investment banker, Pritchard
Capital Partners LLC; and its financial advisor, Ambrose
Consulting LLC.
The case is In Re Harvest Oil and Gas, LLC (Bankr. W.D. La. Lead
Case No. 09-50397). Robin B. Cheatham, Esq., at Adams & Reese
LLP, represents the Debtors in their restructuring efforts. The
Debtors listed between $100 million and $500 million each in
assets and debts.
SAXBYS COFFEE: Blames Bankruptcy Due to Purchase-Related Suits
--------------------------------------------------------------
Natalie Kostelni at Philadelphia Business Journal reports that
Saxbys Coffee Worldwide, LLC, faced with legal fees that has
become a financial and time burden for the Company, filed for
Chapter 11 bankruptcy protection.
Business Journal says that Saxbys Coffee was mired in so much
litigation that the Company decided to seek bankruptcy protection
to either eliminate the lawsuits in Colorado and Illinois or to at
least have them refiled in Philadelphia courts.
Business Journal relates that Joe Grasso acquired Saxbys Coffee
and relocated its headquarters to Conshohocken from Atlanta. The
report states that the purchase led to a round of lawsuits from
former shareholders who believe Saxbys Coffee was sold without
proper approval from the entire ownership group. The report
quoted Saxbys Coffee President and CEO Nick Bayer as saying,
"Unfortunately, Joe was unable to make a deal with some
shareholders."
Saxbys Coffee has opened a new store at Liberty Place, a high-
profile location for any retailer, Business Journal relates.
Conshohocken, Pennsylvania-based Saxbys Coffee Worldwide, LLC, is
a 37-store chain that operates 14 stores in Pennsylvania, where it
acquired parts of the former Bucks County Coffee Co. in 2008,
along with others scattered from Washington and Atlanta to
California.
The Company filed for Chapter 11 bankruptcy protection on
August 5, 2009 (Bankr. E.D. Pa. Case No. 09-15898). Paul J.
Winterhalter, Esq., at Law Offices of Paul J Winterhalter, P.C.,
assists the Company in its restructuring efforts. The Company
listed up to $50,000 in assets and $1,000,001 to $10,000,000 in
liabilities when it filed for bankruptcy.
SBARRO INC: Paid $400,000 to Professionals on Loan Amendments
-------------------------------------------------------------
Sbarro Inc. disclosed paying $400,000 in professional fees related
to the prepayment and amendment to its senior credit facilities
during the first six months of 2009.
As of year end, Sbarro was in violation of its total net leverage
ratio covenant under the credit agreement governing its Senior
Credit Facilities. On March 26, 2009, Sbarro entered into an
amendment to the Senior Credit Facilities. The amendment
permitted the Company to refinance a portion of its Term Loan by
entering into a new Second Lien Facility, permanently waived a
breach of its total net leverage ratio covenant for the fiscal
quarter ended December 28, 2008, replaced its total net leverage
ratio covenant and interest coverage ratio covenant with a minimum
EBITDA covenant and a maximum capital expenditure covenant,
increased the margin on its Term Loan and Revolving Facility by
200 basis points, required prepayment of $25.0 million of the Term
Loan from the proceeds of the Second Lien Facility, required
prepayment of $3.5 million of the Revolving Facility from cash on
hand and simultaneously reduced the Revolving Facility's amount
outstanding and commitment to $21.5 million, and restricted
payment of MidOcean's annual management fee so that such fee will
accrue but not be paid until the Company's EBITDA is at least
$55.0 million and, after such goal is obtained, then a maximum of
$2.0 million of such fees may be paid each year.
In January 2007, entities controlled by MidOcean Partners III, LP,
a private equity firm, and certain of its affiliates acquired the
Company, pursuant to an agreement and plan of merger. MidOcean
SBR Acquisition Corp., a wholly owned subsidiary of Sbarro
Holdings, LLC, merged with and into the Company, with the Company
surviving the Merger.
Sbarro entered into the senior secured credit facilities in
connection with the merger. The senior secured credit facilities
originally provided for loans of $208.0 million under a
$183.0 million senior secured term loan facility and a
$25.0 million senior secured revolving facility.
Sbarro also entered into a new Second Lien Facility that provides
for $25.5 million in new money. The new facility matures in 2014.
The loan under the Second Lien Facility was made by Column
Investments S.a.r.l., an affiliate of MidOcean.
Sbarro has said it is highly leveraged and a substantial portion
of its liquidity needs arise from debt service on indebtedness
incurred in connection with the Merger and from funding costs of
operations, working capital and capital expenditures. Sbarro said
adverse macroeconomic factors, including reduced mall traffic
during the holiday shopping season, and a decline in consumer
spending, among other factors, may negatively impact achieving
projected operating cash flow.
In August, Sbarro published results of operations for the second
quarter and six months ended June 28, 2009. Revenues were
$80.1 million for the quarter ended June 28, 2009 as compared to
revenues of $85.4 million for the quarter ended June 29, 2008.
The decrease in revenues was primarily due to a 5.1% decrease in
Company-owned comparable-unit sales and stores closed, offset by
revenues generated by new Company-owned stores opened in 2008 and
the first half of 2009. The decrease in comparable-unit sales
primarily reflects the reduction in mall traffic throughout the
United States as a result of weakened consumer spending in the
current economic environment, partially offset by the Easter
holiday falling in the second quarter of 2009 versus the first
quarter of 2008. Domestic franchise comparable-unit sales
declined 4.5% while international franchise comparable-unit sales
declined 23.2%, primarily due to the strengthening of the U.S.
Dollar relative to virtually all foreign currencies. Without
consideration for foreign currency fluctuations, the international
franchise comparable-unit sales decline would have been 4.5%.
Net loss attributable to Sbarro, Inc. for the quarter ended
June 28, 2009, was $6.5 million as compared to a net loss of
$5.0 million for the quarter ended June 29, 2008. The increase
was primarily the result of a $3.2 million increase in tax expense
in the quarter as compared to the second quarter of 2008. Without
consideration for taxes, net loss decreased roughly $1.7 million,
or 21%.
Revenues were $159.7 million for the six months ended June 28,
2009, as compared to revenues of $168.6 million for the six months
ended June 29, 2008. The decrease in revenues was primarily due
to a 4.9% decrease in Company-owned comparable-unit sales and
stores closed offset by revenues generated by new Company-owned
stores opened in 2008 and the first half of 2009. The decrease in
comparable-unit sales primarily reflects the reduction in mall
traffic throughout the United States as a result of weakened
consumer spending in the current economic environment. Domestic
franchise comparable-unit sales declined 4.3% while international
franchise comparable-unit sales declined 24.9%, primarily due to
the strengthening of the U.S. Dollar relative to virtually all
foreign currencies. Without consideration for foreign currency
fluctuations, the international franchise comparable-unit sales
decline would have been 6.8%.
Net loss attributable to Sbarro, Inc., for the six months ended
June 28, 2009, was $12.2 million as compared to a net loss of
$7.7 million for the six months ended June 29, 2008. The increase
was primarily the result of a $5.1 million increase in tax expense
in the first six months of 2009 as compared to the first six
months of 2008. Without consideration for taxes, net loss
decreased roughly $.6 million, or 5.2%.
As of June 28, 2009, the Company had $517.6 million in total
assets; and total current liabilities of $34.5 million, deferred
rent of $5.95 million, deferred tax liability of $87.2 million,
due to former shareholders & other of $11.2 million, accrued
interest payable of $985,000, and long-term debt of
$335.9 million. Sbarro had an accumulated deficit of
$100.8 million and shareholders' equity, including non-controlling
interests, of $41.5 million.
In July 2009, Moody's increased Sbarro's credit ratings to Caa1
from Caa2 on its Senior Credit Facility, affirmed its C rating on
its Senior Notes and affirmed its Ca rating on Corporate.
A full-text copy of Sbarro's Form 10-Q report is available at no
charge at http://ResearchArchives.com/t/s?4460
Based in Melville, New York, Sbarro Inc. -- http://www.sbarro.com/
-- is the world's leading Italian quick service restaurant concept
and the largest shopping mall-focused restaurant concept in the
world. Sbarro has 1,062 restaurants in 44 countries.
SEAWAY VALLEY: June 30 Balance Sheet Upside-Down by $18.5 Million
-----------------------------------------------------------------
Seaway Valley Capital Corp.'s balance sheet at June 30, 2009,
showed total assets of $19.09 million and total liabilities of
$37.63 million, resulting in a stockholders' deficit of
$18.54 million.
For three months ended June 30, 2009, the Company posted a net
loss of $9.52 million compared with a net loss of $2.87 million
for the same period in 2008.
For six months ended June 30, 2009, the Company posted a net loss
of $13.47 million compared with the net loss of $5.80 million for
the same period in 2008.
A full-text copy of the Company's Form 10-Q is available for free
at http://ResearchArchives.com/t/s?4434
Based in Gouverneur, New York, Seaway Valley Capital Corp. (OTC:
SWVC) -- http://www.seawaycapital.com/-- makes equity, equity-
related, and debt investments in companies that require expansion
capital. Seaway also seeks investments in leveraged buyouts and
restructurings. Its current holdings include Patrick Hackett
Hardware Company and North Country Hospitality Inc.
Going Concern Doubt
Dannible & McKee, LLP, in Syracuse, New York, expressed
substantial doubt about Seaway Valley Capital Corp.'s ability to
continue as a going concern after auditing the company's
consolidated financial statements for the fiscal years ended
Dec. 31, 2008 and 2007. The auditing firm noted that the Company
suffered losses from operations, is in default on a credit
facility and has a working capital deficiency as of Dec. 31, 2008.
SEMGROUP LP: Seeks Injunction Against General Partner
-----------------------------------------------------
SemGroup, L.P., and its debtor affiliates filed an adversary
proceeding in the U.S. Bankruptcy Court for the District of
Delaware asking Judge Brendan Linehan Shannon to enjoin their
general partner, non-debtor SemGroup G.P., L.L.C., from altering
the current tax classification of SemGroup LP.
The adversary proceeding was filed as a response to SGGP's current
move to have SemGroup's current tax classification changed from
"partnership" to "corporation" through a "Check-the-Box" election.
Martin A. Sosland, Esq., at Weil, Gosthal & Manges, LLP, in
Dallas, Texas, speaking on behalf of SemGroup LP, explained that
reclassifying SemGroup LP as a "corporation" would dramatically
impact the Debtors' estates. As a corporation, the cancellation
of debt income as a result of the discharge of debt contemplated
under the Debtors' Joint Plan of Reorganization would remain with
SemGroup rather than being passed through to SGGP and the
unitholders. As a Debtor, Mr. Sosland said SemGroup is not
generally required to income the COD income in its gross income
but is required to reduce certain tax attributes -- most
importantly the tax basis in the assets of the subsidiaries
transferred to SemGroup Finance Corp., which will be later renamed
to SemGroup Corporation pursuant to the Plan.
The reduction in the tax basis by the additional COD income will,
in turn, diminish the ability of SemGroup Corporation to reduce
future taxes and, as a result, diminish SemGroup Corporation's
ability to make payments on the SemGroup Corporation note and the
value of SemGroup Corporation itself, Mr. Sosland pointed out.
In contrast, Mr. Sosland noted, if the Check-the-Box election is
not made, and SemGroup LP's current partnership classification is
maintained, the COD income will pass through to SGGP and the
Uniteholders, and there will be no downward adjustment to the tax
basis of the assets that are to be transferred to SemGroup
Corporation.
The Debtors, through the adversary proceeding, also seek a
temporary restraining order and preliminary injunction to preserve
the status quo pending a determination by the Bankruptcy Court on
the ability of SGGP to reclassify SemGroup LP as a corporation for
purposes of federal income tax reporting.
About SemGroup L.P.
SemGroup, L.P., -- http://www.semgrouplp.com/-- is a midstream
service company that provides diversified services for end users
and consumers of crude oil, natural gas, natural gas liquids and
refined products. Services include purchasing, selling,
processing, transporting, terminalling and storing energy.
SemGroup serves customers in the United States, Canada, Mexico and
Wales.
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)
SIGNATURE APPAREL: Hit With Involuntary Chapter 7 by Creditors
--------------------------------------------------------------
According to Bloomberg News, three creditors owed a combined $14.8
million filed an involuntary Chapter 7 petition against Signature
Apparel Group LLC. (Bankr. N.D. Ga. 09-83407). Signature, based
in New York, calls itself a "multifaceted apparel company." It
owns the Fetish trademark and licenses Rocawear Juniors and Artful
Dodger, according to its Web site.
SPLASH POOL: Blames Bankr. on First Bank's Refusal to Renew Loan
----------------------------------------------------------------
Michael Braga at HeraldTribune.com reports that Splash Pools,
Inc., filed for Chapter 11 bankruptcy protection in the U.S.
Bankruptcy Court for the Middle District of Florida when First
Bank refused to renew a loan used to acquire land in Manatee
County.
According to HeraldTribune.com, Splash Pool CEO James Dellinger
said that he was current on his loan payments when First Bank made
its decision to foreclose. HeraldTribune.com relates that Mr.
Dellinger also offered to pay an additional $10,000 per month if
First Bank would keep the loan on its books, but the bank refused.
HeraldTribune.com states that Splash Pool's $600,000 credit line
was partially secured by the Manatee land. The report says that
when First Bank declined to renew the first loan, the credit line
also fell into default.
Sarasota, Florida Splash Pools, Inc., filed for Chapter 11
bankruptcy protection on July 30, 2009 (Bankr. M.D. Fla. Case No.
09-16581). Scott A. Stichter, Esq., at Stichter, Riedel, Blain &
Prosser 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.
SUN-TIMES MEDIA: Has 'Stalking Horse' Deal With J. Tyree
--------------------------------------------------------
Sun-Times Media Group, Inc. (Pink Sheets: SUTMQ), owner of the
Chicago Sun-Times and 58 suburban newspaper titles and
corresponding Web sites, announced September 8 that it has entered
into a "stalking horse" asset purchase agreement with STMG
Holdings, LLC, a private investor group led by Chicago businessman
James C. Tyree, for substantially all assets of Sun-Times Media
Group.
Sun-Times Media Group has filed motions with the U.S. Bankruptcy
Court for the District of Delaware 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 asset purchase agreement, which is subject
to court approval and certain other closing conditions, the buyer
will acquire substantially all assets of the Company for
$5 million in cash, subject to a working capital adjustment, and
will assume certain liabilities of Sun-Times Media Group estimated
to total approximately $20 million.
On March 31, 2009, Sun-Times Media Group and certain affiliates
(the "Company") filed voluntary petitions under Chapter 11 of the
U.S. Bankruptcy Code. Also on that date, the Company announced
that it had retained Rothschild Inc. to commence a process for the
sale of assets pursuant to Section 363 of the U.S. Bankruptcy
Code.
Prior to Court approval of the purchase agreement, there will be a
competitive bidding process that is intended to generate the
highest possible value for the Company. Once the bidding
procedures have been approved by the Court, the Company will
announce the start of the formal bidding process. The procedures,
if approved, would call for qualified interested parties to submit
binding offers to acquire all or substantially all assets of Sun-
Times Media Group within a certain period designated by the Court.
If qualified bids are received, an auction would be held and the
Court would approve the sale to the winning bidders.
"This agreement is an exciting and very positive step in the
process of securing the future of Sun-Times Media Group's
distinguished print and online brands that are such integral parts
of the communities they so proudly serve," said Jeremy L.
Halbreich, Sun-Times Media Group Chairman of the Board and Interim
Chief Executive Officer. "Five months ago, the Company embarked
upon this process with the goal of stabilizing and ensuring the
long-term future of Sun-Times Media Group's newspapers and online
products, and I'm pleased to have reached this next step in a
timely manner. This proposed Purchase Agreement will create and
establish a wonderful future for our publications and for our
employees."
"In the interim, the Company and all of our employees have taken
extraordinary steps to enhance revenues, reduce costs and
strengthen our organization to become a leaner, more efficient
Company that is capable of meeting the demand for news and
information in this increasingly digital age. This agreement
brings us one step closer to achieving our goals."
"We are grateful to our customers - our advertisers and our
readers - for supporting us during this challenging time. Their
loyalty has been deeply appreciated, as has the loyalty of our
vendors and suppliers. And I'd like to add a special thank you to
all of our employees -- both union and non-union -- who have
demonstrated extraordinary dedication and resilience and worked so
very hard through this recent period of time to continue producing
the finest media products serving Chicago and surrounding
communities. They have shown their ability time and again to adapt
to the changing industry environment."
"The commitments made by our employees have been instrumental in
achieving the rapid turnaround and successes enjoyed by Sun-Times
Media Group over these past few months and their continued
commitment and support will help ensure a healthy, stable future
for all of us and for our products," Mr. Halbreich added.
"The proposed Purchase Agreement represents a significant
financial commitment on the part of the investor group in terms of
the purchase price, assumption of liabilities and substantial
additional resources dedicated to the future growth, innovation
and capital expenditures across the Company's assets and media
properties. The new investors are focused on supporting and
positioning the new Company to succeed both financially and
qualitatively in the Chicago marketplace and to create a strong
business going forward for the benefit of our customers and our
employees," he concluded.
Sun-Times Media Group's legal advisor is Kirkland & Ellis. Huron
Consulting Group is acting as restructuring advisor to the
Company.
More information about the Sun-Times Media Group's bankruptcy case
is available by clicking on the "Chapter 11 Information" link at
http://www.thesuntimesgroup.com/
About Sun-Times Media
Sun-Times Media Group, Inc. -- http://www.thesuntimesgroup.com/--
(Pink Sheets: SUTM) owns media properties including the Chicago
Sun-Times and Suntimes.com as well as newspapers and Web sites
serving more than 200 communities across Chicago. The Company and
its affiliates conduct business as a single operating segment
which is concentrated in the publishing, printing, and
distribution of newspapers in greater Chicago, Illinois,
metropolitan area and the operation of various related Web sites.
The Company also has affiliates in Canada, the United Kingdom, and
Burma.
Sun-Times Media's balance sheet at September 30, 2008, showed
total assets of $479.9 million, total liabilities of
$801.7 million, resulting in a stockholders' deficit of roughly
$321.8 million.
The Company and its affiliates filed for Chapter 11 bankruptcy
protection on March 31, 2009 (Bankr. D. Del. Case No. 09-11092).
James H.M. Sprayregan, P.C., James A. Stempel, Esq., David A.
Agay, Esq., and Sarah H. Seewer, Esq., at Kirkland & Ellis LLP,
assist the Debtors in their restructuring efforts. Kurtzman
Carson Consultants LLC is the Debtors' claims agent. As of
November 7, 2008, the Debtors listed $479,000,000 in assets and
$801,000,000 in debts.
SUN-TIMES MEDIA: Tyree Buyout Won't Stop Losses, Experts Say
------------------------------------------------------------
According to reporting by Mike Collas at Crain's Chicago Business,
experts say the sale of Sun-Times Media Group Inc. to an investor
group led by Mesirow Financial Holdings chairperson James Tyree
won't stanch operating losses by the publisher. The report
relates that Mr. Tyree would face two huge challenges that other
struggling newspapers do not -- Sun-Times is losing money on its
operations, and its flagship paper is the No. 2 player in town at
a time when many observers question whether even one daily paper
can survive in most cities.
"There's no evidence that anyone has found the magic bullet for
success in the newspaper business, so it's difficult to imagine an
outsider would be able to," says Mike Simonton, a Chicago-based
media analyst at Fitch Ratings, according to the report.
Mr. Collas, citing experts, says the long-term fate of Sun-Times
Media would rely on Mr. Tyree's success finding fresh revenue to
offset steep losses in print-advertising sales when few in the
industry have done so. Until it is able to do so, Mr. Tyree
should be prepared to absorb losses, according to experts.
The report notes that real estate mogul Sam Zell sent Tribune Co.
into bankruptcy following his late 2007 acquisition. Philly's two
big dailies landed in Bankruptcy Court in February, less than
three years after a local advertising executive engineered a
$515-million buyout.
As reported by the TCR on September 7, 2009, Sun-Times Media Group
is expected to file a Chapter 11 plan built around a sale of the
Company to Mr. Tyree's group.
Meanwhile, according to The Associated Press, The Post-Tribune of
Merrillville, which publishes seven days a week and serves several
counties in northwestern Indiana, will convert to a smaller,
tabloid format of newspaper beginning October 5. The paper will
continue to focus its coverage on local news and sports. The
Post-Tribune's parent company is the Sun-Times News Group, the
operating subsidiary of Sun-Times Media Group.
About Sun-Times Media
Sun-Times Media Group, Inc. -- http://www.thesuntimesgroup.com/--
(Pink Sheets: SUTM) owns media properties including the Chicago
Sun-Times and Suntimes.com as well as newspapers and Web sites
serving more than 200 communities across Chicago. The Company and
its affiliates conduct business as a single operating segment
which is concentrated in the publishing, printing, and
distribution of newspapers in greater Chicago, Illinois,
metropolitan area and the operation of various related Web sites.
The Company also has affiliates in Canada, the United Kingdom, and
Burma.
Sun-Times Media's balance sheet at September 30, 2008, showed
total assets of $479.9 million, total liabilities of
$801.7 million, resulting in a stockholders' deficit of roughly
$321.8 million.
The Company and its affiliates filed for Chapter 11 bankruptcy
protection on March 31, 2009 (Bankr. D. Del. Case No. 09-11092).
James H.M. Sprayregan, P.C., James A. Stempel, Esq., David A.
Agay, Esq., and Sarah H. Seewer, Esq., at Kirkland & Ellis LLP,
assist the Debtors in their restructuring efforts. Kurtzman
Carson Consultants LLC is the Debtors' claims agent. As of
November 7, 2008, the Debtors listed $479,000,000 in assets and
$801,000,000 in debts.
TAYLOR BEAN: Bankruptcy Filing Hits Illinois County
---------------------------------------------------
The bankruptcy filing of Taylor, Bean & Whitaker Mortgage Corp.
has hit residents of Will County, Illinois, who sent their tax
money to escrow accounts held by the bankrupt company, according
to reporting by The Plainfield Sun, member of the Sun-Tines News
Group. Owners of 1,700 parcels of land deposited payments for
their property taxes with Taylor Bean. The Company paid the first
installment of taxes that were due June 1, but it's not clear if
or when more than $4 million in escrow will be used for the taxes
due this month.
Taylor, Bean & Whitaker Mortgage Corp. is a 27-year-old company
that grew from a small Ocala-based mortgage broker to become one
of the largest mortgage bankers in the United States. In 2009,
Taylor Bean was the country's third largest direct-endorsement
lender of FHA-insured loans of the largest wholesale mortgage
lenders and issuer of mortgage backed securities. It also managed
a combined mortgage servicing portfolio of approximately
$80 billion. The company employed more that 2,000 people in
offices located throughout the United States.
Taylor Bean filed for Chapter 11 on August 24 (Bankr. M.D. Fla.
Case No. 09-07047). Edward J. Peterson, III, Esq., at Stichter,
Riedel, Blain & Prosser, PA, in Tampa, Florida, represents the
Debtor. Troutman Sanders LLP is special counsel. BMC Group Inc.
serves as claims agent. Taylor Bean has more than $1 billion of
both assets and liabilities, and between 1,000 and 5,000
creditors, according to the bankruptcy petition.
TEKNI-PLEX INC: Inks Separation Deal with COO Edward Goldberg
-------------------------------------------------------------
Tekni-Plex, Inc., disclosed that in connection with Edward
Goldberg's retirement as Chief Operating Officer of the Company,
effective August 31, 2009, the Company entered into a Separation
Agreement with Mr. Goldberg on August 28.
On August 4, 2009, Tekni-Plex informed its employees that Mr.
Goldberg would retire as Chief Operating Officer effective at the
end of August 2009. Tekni-Plex said executives reporting to Mr.
Goldberg would report to Paul Young, the company's Chief Executive
Officer.
Pursuant to the Separation Agreement, for a period of 26 weeks
beginning on September 1, 2009, Mr. Goldberg will continue to
receive his base salary and the right to participate in the
Company's group health insurance plan on the same terms and
conditions as he participated immediately prior to retirement.
These payments and benefits are conditioned upon Mr. Goldberg
executing and not revoking a release of claims against the Company
and its subsidiaries.
Mr. Goldberg will also be entitled to receive a bonus payment with
respect to performance in fiscal year 2009, payable at the same
time as fiscal year 2009 bonuses are paid to then-current officers
of the Company. The exact amount will be determined by the
Company in the course of finalizing the entire fiscal year 2009
bonus program.
During the 12-month period following his retirement date, Mr.
Goldberg is subject to covenants not to compete with the Company
or its subsidiaries and not to solicit any employees, clients or
customers of the Company or its subsidiaries. He is also subject
to ongoing covenants not to disclose confidential information of
the Company or its subsidiaries and not to disparage the Company,
its subsidiaries or affiliates.
The Company also entered into a Consulting Agreement with Mr.
Goldberg on September 1, 2009, pursuant to which he will provide
consulting services to the Company for a period of six months
beginning on September 1, 2009, unless terminated earlier upon 60
days written notice by either party. The Company will pay Mr.
Goldberg $1,500 per work day, with the minimum monthly payment
equal to $12,000. If the Company terminates the Consulting
Agreement prior to the end of the six month term, it will pay Mr.
Goldberg an amount equal to $72,000 less any amounts previously
paid under the Consulting Agreement.
About Tekni-Plex
Headquartered in Coppell, Texas, Tekni-Plex Inc. --
http://www.tekni-plex.com/-- manufactures packaging, packaging
products and materials as well as tubing products. The company
primarily serves the food, healthcare and consumer markets. It
has built leadership positions in its core markets, and focuses on
vertically integrated production of highly specialized products.
Tekni-Plex has operations in the United States, Europe, China,
Argentina, and Canada.
Tekni-Plex has not filed financial reports in 2009. On June 27,
2008, Tekni-Plex said it had initiated an internal investigation
regarding the Company's financial records.
* * *
As reported by the Troubled Company Reporter on April 6, 2009,
Moody's Investors Service withdrew the ratings for Tekni-Plex due
to a lack of sufficient information to assess the creditworthiness
of the company. The Company is a voluntary filer and has obtained
waivers from its lenders allowing it until December 31, 2009, to
file the required statements. Although the Company has
successfully restructured and reduced its debt and secured
financing to continue operating, the lack of published financial
data leaves insufficient information to assess effectively the
creditworthiness of the issuer, Moody's said. The Company has
also declined to provide any information to Moody's to facilitate
the continuation of ratings coverage.
These ratings were withdrawn:
-- $150 million 10.87% sr. secured notes due 2012, Caa1 (LGD2,
16%)
-- $275 million 12-3/4% sr. subordinated notes due 2010, C
(LGD5, 85%)
-- $40 million 12-3/4% sr. subordinated notes due 2010, C (LGD5,
85%)
-- $275 million 8.75% sr. secured second lien notes due 2013,
Caa3 (LGD3, 46%)
-- Caa3 Corporate Family Rating
-- Caa3/LD Probability of Default Rating
TELIPHONE CORP: June 30 Balance Sheet Upside-Down by $178,000
-------------------------------------------------------------
Teliphone Corp.'s balance sheet at June 30, 2009, showed total
assets of $1,505,594 and total liabilities of $1,684,134,
resulting in a stockholders' deficit of $178,540.
For nine months ended June 30, 2009, the Company reported a net
income applicable to common shares of $147,338 compared with a net
loss of $91,193 for the same period in 2008.
For three months ended June 30, 2009, the Company reported a net
income applicable to common shares of $105,594 compared with a net
loss of $17,658 for the same period in 2008.
The Company said that there is substantial doubt about its ability
to continue as a going concern. The Company noted that it has a
working capital deficiency of $463,064 as of June 30, 2009, and
has an accumulated deficit of $1,605,722 through June 30, 2009.
The Company has utilized their line of credit limits from the bank
and their profits have gone to pay down the payables that exist.
A full-text copy of the Company's Form 10-Q is available for free
at http://ResearchArchives.com/t/s?4453
Teliphone Corp. (OTC:TLPH) fka OSK Capital II Corporation, is a
telecommunications company. The Company provides broadband
telephone services utilizing its voice-over-Internet protocol and
technology platform. The Company offers products and services to
customers utilizing its VoIP technology platform, which include
residential phone service and business phone service. The
customers purchase a VoIP adaptor from a re-seller and install it
in their home. This allows the traditional phones in their home
to have their inbound and outbound calls redirected to the
Company. As a result, the residential customers purchase their
choice of unlimited local or long distance calling services, with
pay-per-minute long distance calling services. Under business
phone service, the customers purchase multiple VoIP adaptors from
re-sellers and install them in their business.
TRIANGLE PETROLEUM: Posts $232,352 Net Loss in Qtr. Ended July 31
-----------------------------------------------------------------
Triangle Petroleum Corporation posted a net loss of $232,352 for
three months ended July 31, 2009, compared with a net loss of
$2,386,993 for the same period in 2008.
For six months ended July 31, 2009, the Company posted a net loss
of $929,300 compared with a net loss of $4,213,248 for the same
period in 2008.
The Company's balance sheet at July 31, 2009, showed total assets
of $24,349,884, total liabilities of $1,179,751 and stockholders'
equity of $23,170,133.
The Company said that there is substantial doubt about its ability
to continue as a going concern. The Company note that it will
have to raise additional funds through equity or debt offerings,
dispositions of assets or other means to fund general and
administrative expenses and to complete the exploration and
development phase of its programs. The continuation of the
Company as a going concern is dependent upon its ability to obtain
necessary additional funds to continue operations and to determine
the existence, discovery and successful exploitation of
economically recoverable reserves in its resource properties,
confirmation of the Company's interests in the underlying
properties, and the attainment of profitable operations.
Failure to obtain additional financing will result in the going
concern assumption being inappropriate and adjustments would be
required to the carrying values of assets and liabilities, the
reported revenues and expenses, and the balance sheet
classifications used.
A full-text copy of the Company's Form 10-Q is available for free
at http://ResearchArchives.com/t/s?4430
Triangle Petroleum Corporation (OTC:TPLM) is an exploration
company focused on shale gas opportunities in the Maritimes Basin
of Nova Scotia, Canada. The Company has a 57% working interest in
516,000 gross acres on the Windsor Block in Nova Scotia.
TRIBUNE CO: Anti-Trust Office Won't Block Cubs Sale to Rickets
--------------------------------------------------------------
Christopher Stern at Bloomberg News reports that the U.S. Federal
Trade Commission has approved Tribune Co.'s sale of the Chicago
Cubs baseball team to the Ricketts family, which founded TD
Ameritrade Holding Co.
At the end of August, Judge Kevin Carey of the U.S. Bankruptcy for
the District of Delaware approved Tribune's proposed process for
effectuating the sale of the Chicago Cubs baseball team. The sale
process does not contemplate an auction and provides for a
$5 million to $20 million break-up fee to the buyer in case the
transaction fails.
Judge Carey will consider approval of Tribune's proposed sale of
the Chicago Cubs to the buyer at a hearing September 24.
Tribune Co. and a non-debtor affiliate submitted before the
Bankruptcy Court a motion to sell the Chicago Cubs baseball team
to the family of TD Ameritrade Holding Corp. founder Joe Ricketts,
saying the sale will bring $740 million in cash to creditors.
The National League Ball Club, LLC, Tribune's non-debtor affiliate
directly owning the Cubs, will file for Chapter 11 as soon as the
Bankruptcy Court approves Tribune's proposal and in order to
effectuate the sale. Judge Carey has scheduled a hearing on
October 1, 2009 to consider approval of the sale in CNLBC's case.
Aside from approval from the Bankruptcy Court, transfer of the
Cubs team requires approval by Major League Baseball, an
unincorporated association of 30 member clubs in North America.
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Co. --
http://www.tribune.com/-- is a media company, operating
businesses in publishing, interactive and broadcasting, including
ten daily newspapers and commuter tabloids, 23 television
stations, WGN America, WGN-AM and the Chicago Cubs baseball team.
The Company and 110 of its affiliates filed for Chapter 11
protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08-
13141). The Debtors proposed Sidley Austion LLP as their counsel;
Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel;
Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial
advisors; and Epiq Bankruptcy Solutions LLC as claims agent.
Attorneys at Landis Rath & Cobb LLP, and Chadbourne & Parke LLP,
represent the Official Committee of Unsecured Creditors. As
of December 8, 2008, the Debtors have $7,604,195,000 in total
assets and $12,972,541,148 in total debts.
Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy
News. The newsletter tracks the Chapter 11 proceeding undertaken
by Tribune Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TRIBUNE CO: Committee Gets Court Nod for Zuckerman as Counsel
-------------------------------------------------------------
The Official Committee of Unsecured Creditors in Tribune Co.'s
cases sought the Court's authority to retain Zuckerman Spaeder LLP
as special counsel nunc pro tunc to August 6, 2009.
From the inception of the Debtors' cases, it has been apparent to
all parties that a major issue in connection with any proposed
plan of reorganization for the Debtors s the investigation and
resolution of certain potential claims and causes of action in
favor of the Debtors' estates arising from the series of
transactions during calendar year 2007 pursuant to which the
Debtors became privately held. The Creditors' Committee has
determined that good cause exists to retain a special counsel to
assist in the further investigation of the Leveraged ESOP
Transactions, and in negotiations with the respective lenders and
the Debtors looking toward a consensual resolution of any claims
if that resolution can be achieved.
As special counsel, Zuckerman Spaeder has agreed to:
(a) assist the Committee in the analysis of the potential
causes of action;
(b) participate in negotiations with lenders and the Debtors;
(c) if necessary, prosecute causes of action to the extent the
Committee may be authorized to bring those causes of
action; and
(d) perform any other legal services as required by the
Committee.
Zuckerman will be paid based on the firm's current hourly rates:
Professional Rate/Hour
------------ ---------
Partners and counsel $475-$825
Associates $300-$500
Staff Attorneys $255-$355
Paraprofessionals $155-$275
Zuckerman will also be reimbursed for all costs and expenses
including, among other things, long-distance telephone and
telecopier charges, mail and express mail charges, filing fees,
travel expenses, and transcription costs.
Thomas G. Macauley, Esq., at Zuckerman Spaeder LLP, in
Washington, D.C., assures the Court that his firm is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
Law Debenture Objects
Law Debenture Trust Company of New York, as successor trustee
under an Indenture, dated March 19, 1996, between Tribune Company
and Citibank, N.A., for the 6.61% Debentures due 2027 and the 7-
1/4% Debentures due 2096, complains that the Committee's
application to retain Zuckerman Spaeder LLC is unclear as to
whether it will perform the necessary work separately and
independently from the Committee's existing bankruptcy counsel.
Law Debenture asserts that Zuckerman must be completely
independent with respect to the 2007 leveraged buyout transaction
claims because the disabling conflicts of the Committee's
bankruptcy counsel is the reason for its retention. According to
Law Debenture, the Committee's application is also unclear as to
whether it will be working with the Committee's existing
financial advisors, which also suffer from disabling conflicts of
interest with respect to potential LBO defendants. Law Debenture
maintains that all advisors must be independent and must not be
subject to internal policies that prohibit complete fealty to the
representation of the Committee in its fiduciary representation
of all unsecured creditors in the efforts at hand.
Accordingly, Law Debenture supports retention of special counsel
but reserves its right to contest the manner in which it
functions and, if necessary, to ask for this Court's intervention
in an appropriate context.
Zuckerman Files Supplemental Declaration
In a supplemental declaration, Mr. Macauley states that, based on
the information available to his firm and his understanding of
the potential litigation relating to the Debtors' obligations
under the Senior Credit Facility and Bridge Facility entered into
in connection with the Leveraged ESOP Transaction, the Delaware
Lawyers' Rules of Professional Conduct would not restrict his
firm's ability to prosecute the litigation.
* * *
The Court authorizes the Committee to retain Zuckerman as special
counsel. Prior to the entry of the order, the Committee related
that it received informal comments on the retention motion from
the Office of the U.S. Trustee and as a result of those informal
comments, Zuckerman filed a supplemental declaration in support
of the retention motion. The Committee said the U.S. Trustee has
reviewed the supplemental declaration and indicated that the
filing of that document resolved its informal comments.
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Co. --
http://www.tribune.com/-- is a media company, operating
businesses in publishing, interactive and broadcasting, including
ten daily newspapers and commuter tabloids, 23 television
stations, WGN America, WGN-AM and the Chicago Cubs baseball team.
The Company and 110 of its affiliates filed for Chapter 11
protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08-
13141). The Debtors proposed Sidley Austion LLP as their counsel;
Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel;
Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial
advisors; and Epiq Bankruptcy Solutions LLC as claims agent.
Attorneys at Landis Rath & Cobb LLP, and Chadbourne & Parke LLP,
represent the Official Committee of Unsecured Creditors. As
of December 8, 2008, the Debtors have $7,604,195,000 in total
assets and $12,972,541,148 in total debts.
Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy
News. The newsletter tracks the Chapter 11 proceeding undertaken
by Tribune Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TRIBUNE CO: Sidley Austin Charges $1.6MM for July Work
------------------------------------------------------
Pursuant to Sections 330 and 331 of the Bankruptcy Code, these
professionals hired in Tribune Co.'s bankruptcy cases filed
interim fee applications:
A. Debtors' Professionals
Professional Period Fees Expenses
------------ ------ ---- --------
Jones Day 06/01/09-
06/30/09 $22,832 $15
Alvarez & Marsal North 06/01/09-
America, LLC 06/30/09 646,794 7,002
Reed Smith LLP 07/01/09-
07/31/09 25,570 190
Sidley Austin LLP 07/01/09-
07/31/09 1,649,134 34,402
Deloitte & Touche LLP 07/01/09-
07/31/09 84,010 163
PricewaterhouseCoopers 06/01/09-
LLP 06/30/09 208,389 1,391
Stuart Maue 07/01/09-
07/31/09 96,100 176
Jenner & Block LLP 07/01/09-
07/31/09 28,381 818
Cole, Schotz, Meisel, 07/01/09-
Forman & Leonard, P.A. 07/31/09 87,804 8,160
Daniel J. Edelman, Inc. 07/01/09-
07/31/09 2,620 0
The Debtors said they received no objections as to these
professionals' monthly fee applications:
Professional Period
------------ ------
PricewaterhouseCoopers LLP 12/08/08-05/31/09
McDermott Will & Emery LLP 03/01/09-04/30/09
Cole, Schotz, Meisel, Forman & Leonard, P.A. 06/01/09-06/30/09
Stuart Maue 06/01/09-06/30/09
Sidley Austin LLP 06/01/09-06/30/09
Jenner Block LLP 06/01/09-06/30/09
Daniel J. Edelman, Inc. 06/01/09-06/30/09
Paul, Hastings, Janofsky & Walker LLP 06/01/09-06/30/09
Dow Lohnes PLLC 07/01/09-07/31/09
Lazard Freres & Co., LLC 05/01/09-05/31/09
The Debtors certified to the Court that no objections were filed
as to Downey, Smith & Fier's application for payment of
contingency fee for services rendered to Debtor Los Angeles Times
Communications, LLC.
B. Official Committee of Unsecured Creditors' Professionals
Professional Period Fees Expenses
------------ ------ ---- --------
Chadbourne & Parke LLP 07/01/09-
07/31/09 $1,453,980 $37,749
Committee Members 07/01/09-
07/31/09 - 5,317
Landis Rath & Cobb LLP 07/01/09-
07/31/09 95,604 4,705
AlixPartners, LLP 07/01/09-
07/31/09 544,657 10,922
The Committee said it has received no objection as to these
professionals' fee applications:
Professional Period
------------ ------
Chadbourne & Parke LLP 06/01/09-06/30/09
AlixPartners, LLP 06/01/09-06/30/09
Committee Members 06/01/09-06/30/09
Landis Rath & Cobb LLP 06/01/09-06/30/09
Moelis & Company LLC 06/01/09-06/30/09
Fee Examiner's Report
Stuart Maue, in its capacity as fee examiner of the Debtors,
submits its final report with respect to the interim fee
applications of the Debtors' professionals. The Fee Examiner
recommends that the firms be paid:
Recommended Recommended
Firm Period Fees Expenses
---- ----------- -----------
Committee Members 12/18/08-
02/28/09 - $8,853
Chadbourne & Parke 12/18/08-
LLP 02/28/09 1,657,961 58,975
Paul, Hastings, 12/08/08-
Janofsky & Walker LLP 02/28/09 344,161 156
AlixPartners, LLP 12/19/09-
02/28/09 1,052,942 23,325
Jones Day 12/08/08-
02/28/09 23,822 15
Daniel J. Edelman, Inc. 03/04/09-
05/31/09 7,068 125
Alvarez & Marsal North 12/08/08-
America, LLC 02/28/09 2,796,501 22,534
The Committee Members' recommended expenses have been reduced by
$29 representing the amount of two breakfast charges that exceeds
$15. Chadbourne's recommended fees have been reduced by $10,100
on account of duplicative fees, overhead costs and clerical
activities. In addition, Chadbourne's expenses have been reduced
by $4,204 associated with photocopies, facsimile, overhead
expenses and telephone charges. Stuart Maue recommends that
Paul Hasting's fees be reduced by $1,726 on account of
administrative and clerical activities. Stuart Maue also
recommends a reduction by $38 on account of taxi charges.
AlixPartner's recommended fees reflect a reduction of $8,936 in
fees and $735 in expenses. Jones Day's recommended expenses
reflect a reduction of $427 consisting of agreed reduction of
prepetition expenses and agreed reduction of photocopies.
Stuart Maue recommends a reduction of $15,654 on Alvarez & Marsal
fees and $3,510 reduction on expenses.
Professionals Respond To Examiner's Report
The Creditors' Committee complains that it had not received a
notice of meal charge limits during the period in which the
expense applications were submitted. Accordingly, the Committee
questions whether it is fair to retroactively penalize its
members now. The Committee asserts that it seems unfair to
require the unpaid Committee members to waste their valuable time
and energy searching for less costly dining alternatives, when
reasonable, healthy and convenient dining services are readily
available. Accordingly, the Committee requests that the Meal
Charge Limits should not be applied as inflexible rules but
rather common-sense guidelines and that Committee members should
be afforded some reasonable leeway with respect to the Meal
Charge Limits.
Chadbourne tells the Court that it appreciates the opportunity
the Fee Examiner has provided to respond to questions raised
concerning the firm's First Interim Fee Applications. Chadbourne
says it has sought to reach, and in most cases has reached,
appropriate resolution of issues raised by the Fee Examiner.
However, three issues were raised by the Fee Examiner that are
likely to be raised again in subsequent Chadbourne fee
applications relating to:
(a) legal activities conducted by Chadbourne's professionals
that the Fee Examiner seeks to classify as administrative;
(b) Chadbourne's legal activities that the Fee Examiner seeks
to have paid at a lower "clerical" rate; and
(c) certain Chadbourne expenses related to "overtime" that the
Fee Examiner asserts are not reimbursable.
Thus, Chadbourne asks the Court to approve its First Interim Fee
Application as modified in the Final Report but subject to the
Court's ruling.
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Co. --
http://www.tribune.com/-- is a media company, operating
businesses in publishing, interactive and broadcasting, including
ten daily newspapers and commuter tabloids, 23 television
stations, WGN America, WGN-AM and the Chicago Cubs baseball team.
The Company and 110 of its affiliates filed for Chapter 11
protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08-
13141). The Debtors proposed Sidley Austion LLP as their counsel;
Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel;
Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial
advisors; and Epiq Bankruptcy Solutions LLC as claims agent.
Attorneys at Landis Rath & Cobb LLP, and Chadbourne & Parke LLP,
represent the Official Committee of Unsecured Creditors. As
of December 8, 2008, the Debtors have $7,604,195,000 in total
assets and $12,972,541,148 in total debts.
Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy
News. The newsletter tracks the Chapter 11 proceeding undertaken
by Tribune Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TXCO RESOURCES: Creditors Oppose Extension of Plan Exclusivity
--------------------------------------------------------------
The official committee of unsecured creditors for TXCO Resources
Inc. will appear before the Bankruptcy Court today facing an
objection to a proposed extension of TXCO's exclusive period to
file a Chapter 11 plan, Bloomberg's Bill Rochelle reported.
According to the report, the creditors committee contends that the
second-lien term loan lenders, owed $100 million, currently have
control over the plan process by virtue of the terms of the DIP
financing they provided.
The DIP credit agreement, the committee argues, effectively
prohibits TXCO from selling the assets while the Dec. 15 maturity
of the financing effectively requires the company to propose a
plan in October giving stock to the second-lien lenders.
So they won't be "painted into a corner," the creditors committee
contends that an extension of exclusivity should be denied so they
can develop an alternative, Mr. Rochelle reported.
About TXCO Resources
TXCO Resources Inc. is an independent oil and gas enterprise with
interests in the Maverick Basin, the onshore Gulf Coast region and
the Marfa Basin of Texas, and the Midcontinent region of western
Oklahoma. TXCO's business strategy is to acquire undeveloped
mineral interests and internally developing a multi-year drilling
inventory through the use of advanced technologies, such as 3-D
seismic and horizontal drilling. It accounts for its oil and gas
operations under the successful efforts method of accounting and
trades its common stock on Nasdaq's Global Select Market under the
symbol "TXCO."
The Company and its affiliates filed for Chapter 11 protection on
May 17, 2009 (Bankr. W.D. Tex. Case No. 09-51807). The Debtors
hired Deborah D. Williamson, Esq., and Lindsey D. Graham, Esq., at
Cox Smith Matthews Incorporated, as general restructuring counsel;
Fulbright and Jaworski, L.L.P., as corporate counsel & conflicts
counsel; Albert S. Conly as chief restructuring officer and FTI
Consulting Inc. as financial advisor; Goldman, Sachs & Co. as
financial advisor for assets sale; Global Hunter Securities, LLC,
as financial advisors and investment bankers; and Administar
Services Group LLC as claims agent. Gardere Wynne Sewell LLP
represents the Committee.
As reported in Troubled Company Reporter on July 6, 2009, in their
schedules of assets and liabilities, the Debtors have $357,855,952
in total assets and $331,422,792 in total liabilities.
UNI-MARTS LLC: Lehigh-Led Auction Scheduled for Sept. 23
--------------------------------------------------------
Uni-Marts LLC will hold a Sept. 23 auction to test whether there
are bids that would beat the offer proposed by Kwik Pik, LLC, an
affiliate of an established petroleum marketing company, Lehigh
Gas Corporation.
Kwik Pik, as stalking horse bidder, is offering $2.3 million cash
for the business to be purchased under a reorganization plan. It
is also offering the secured lender Comerica Bank a $10 million
note while giving Uni-Marts cash representing 20% of inventories
plus a note for 80% of inventory value owned by UM Ohio. In
addition, Lehigh will provide Uni-Marts with releases for $4.4
million in 11 U.S.C. Sec. 503(b)(9) claims by vendors.
Under the revised bidding procedures approved by the Bankruptcy
Court, an auction will be held if qualified bids are sent by
September 16. Competing bids must exceed Lehigh's offer by
$600,000.
Lehigh will receive a $250,000 break-up fee and expense
reimbursement in the even the Debtor closes a sale with another
party.
Uni-Marts previously proposed a sale process where the Company's
primary shareholder Tri-Color Holdings LLC would be stalking horse
bidder. The proposal, however, was met with objections and did
not receive the Court's approval.
The U.S. Bankruptcy Court for the District of Delaware has set a
hearing on September 22, 2009, at 4:00 p.m. to consider approval
of the disclosure statement explaining Uni-Marts and its
affiliated debtors' joint plan of liquidation dated August 18,
2009. The Plan provides for the conduct of an auction for
substantially all of the Debtors' assets, the proceeds of which
will be used to make a number of payments contemplated by the
Plan. Allowed other secured claims, allowed priority non-tax
claims, and allowed unclassified claims will be fully paid.
Certain outstanding interests in the Debtors will be cancelled.
About Uni-Marts
Headquartered in State College, Pennsylvania, Uni-Marts LLC owned
283 convenience stores and gasoline stations in Pennsylvania, New
York and Ohio, but later reduced the store count during its
bankruptcy case, which is still pending. It was taken private in
2004 by the Sahakian family and private-equity investors.
The Company and six of its affiliates filed for Chapter 11
protection on May 29, 2008 (Bankr. D. Del. Lead Case No.08-11037).
Michael Gregory Wilson, Esq., at Hunton & Williams LLP, represents
the Debtors in their restructuring efforts. The Debtors selected
Epiq Bankruptcy Solutions LLC as their claims, notice and
balloting agent. The U.S. Trustee for Region 3 appointed seven
creditors to serve on an Official Committee of Unsecured
Creditors. The Committee selected Blank Rome LLP as its counsel.
VELOCITY ENERGY: June 30 Balance Sheet Upside-Down by $5.8 Million
------------------------------------------------------------------
Velocity Energy Inc.'s balance sheet showed total assets of
$8,272,254 and total liabilities of $14,147,615, resulting in a
stockholders' deficit of $5,875,361.
For three months ended June 30, 2009, the Company posted a net
loss of $2,166,138 compared with a net loss of $71,866 for the
same period in 2008.
For six months ended June 30, 2009, the Company posted a net loss
of $6,510,890 compared with a net loss of $1,321,181 for the same
period in 2008.
The Company said that there is substantial doubt about the
Company's ability to continue as a going concern. The Company
noted that it experienced a net loss of $6,300,000 for the year
ended Dec. 31, 2008, a net loss of $4,300,000 in the first quarter
of 2009, and a net loss of $2,200,000 in the second quarter of
2009. Furthermore, the Company has $20,200,000 in debt, maturity
value, plus associated interest obligations, and virtually no
current source of revenue.
The Company is pursuing acquisitions of producing properties in
the Appalachian Basin. The management team has met with numerous
providers of both debt and equity, and is currently evaluating
several potential acquisition targets. If successful with its
Appalachian Basin acquisition strategy, the Company expects to
acquire a steady revenue stream from long-lived assets. On
April 13, 2009, the Company executed a letter of intent to acquire
certain producing properties in southern West Virginia pursuant to
the Company's Appalachian Basin acquisition strategy, but did not
consummate this acquisition in the second quarter of 2009 as
anticipated. The Company remains in discussions with respect to
that acquisition and other opportunities in the Appalachian Basin.
A full-text copy of the Company's Form 10-Q is available for free
at http://ResearchArchives.com/t/s?4455
Velocity Energy Inc. (OTC:VCYE) fka Sonterra Resources, Inc., is
an oil and gas exploration and production company. The Company's
oil and gas assets consist of certain oil and gas properties and
related assets that the Company acquired from Cinco Natural
Resources Corporation and Flash Gas & Oil Southwest, Inc. The
Company's wholly owned subsidiary, Sonterra Operating, Inc., is an
operator of its oil and gas properties, which are located in
Matagorda Bay in Texas State Waters lying offshore the Texas
coastal counties of Calhoun and Matagorda.
VERASUN ENERGY: FNBO Gets Lift Stay to Access L/C Collateral
------------------------------------------------------------
At the behest of First National Bank of Omaha, the cash
management bank and prepetition lender for certain of the
Debtors, the Court lifted the automatic stay to allow the bank to
access a certain Commercial Money Market Account, which serves as
the collateral for outstanding letters of credit issued by FNBO
on behalf of VeraSun Energy Corporation.
On or about December 10, 2007, FNBO issued two letters of credit,
for VeraSun's in favor of Vectren Energy Delivery of Ohio, Inc.,
and Indiana Gas Company, d/b/a Vectren, amounting to $1,375,000
and $150,000 to secure VeraSun's purchases of natural gas,
pursuant to a certain promissory note and continuing letter of
credit agreement by and between FNBO and VeraSun.
Tobey M. Daluz, Esq., at Ballard Spahr Andrews & Ingersoll LLP,
in Wilmington, Delaware, relates that to secure the payment of
performance of any and all of VeraSun's obligations or
liabilities under the LC Agreement, VeraSun pledged to FNBO, a
perfected first priority lien and security interest in the funds
held in the Money Market Account, which amount to $l.5 million.
In addition, FNBO has issued certain other letters of credit
amounting to $5.9 million on behalf of the Debtors.
Mr. Daluz further relates that as security for the payment of
performance of any and all of the Debtors' obligations or
liabilities under the LC Agreement, the Debtors pledged to FNBO,
in addition to the Money Market Collateral, a general security
interest in or right of set-off against, all right, title and
interest of the Debtors in and to the balance of every deposit
account of the Debtors with FNBO.
As previously reported, the Debtors rejected a certain Natural
Gas Transportation Service Agreement between Vectren and ASA
Bloomingburg LLC, and a certain Gas Service Agreement between
Indiana and ASA Linden LLC, to which the LC Agreement relate.
As a result of the Debtors' rejection of the Contracts, Vectren
and Indiana properly presented FNBO with draw requests amounting
to $581,612 and $79,991 in accordance with the Vectren and
Indiana LCs, and FNBO, in turn, funded the Draws in accordance
with the Vectren and Indiana LCs and the LC Agreement.
About VeraSun Energy
Headquartered in Sioux Falls, South Dakota, VeraSun Energy Corp.
-- http://www.verasun.comor http://www.VE85.com/-- produces and
markets ethanol and distillers grains. Founded in 2001, the
company has a fleet of 16 production facilities in eight states,
with 14 in operation.
The Company and its debtor-affiliates filed for Chapter 11
protection on October 31, 2008 (Bankr. D. Del. Case No. 08-12606).
Mark S. Chehi, Esq., at Skadden Arps Slate Meagher & Flom LLP
represents the Debtors in their restructuring efforts.
AlixPartners LLP serves as their restructuring advisor.
Rothschild Inc. is their investment banker and Sitrick & Company
is their communication agent. The Debtors' claims noticing and
balloting agent is Kurtzman Carson Consultants LLC. The Debtors'
total assets as of June 30, 2008, was $3,452,985,000 and their
total debts as of June 30, 2008, was $1,913,214,000.
VeraSun closed on April 1, 2009, the sale of substantially all of
its assets to Valero Renewable Fuels, a subsidiary of Valero
Energy Corporation, North America's largest petroleum refiner and
marketer. The purchased assets included five ethanol production
facilities and a development site. The facilities are located in
Aurora, South Dakota; Fort Dodge, Charles City, and Hartley, Iowa;
and Welcome, Minnesota, and the development site is in Reynolds,
Indiana.
Valero paid $350 million for the ethanol production facilities in
Aurora, Fort Dodge, Charles City, Hartley and Welcome, in addition
to the Reynolds site. Valero also successfully bid $72 million
for the Albert City facility and $55 million for the Albion
facility. The purchase price also includes working capital
and other certain adjustments.
VeraSun also completed on April 9 the sale to AgStar Financial
Services PCA of substantially all of the assets relating to the
company's production facilities in Dyersville, Iowa; Hankinson,
North Dakota; Janesville, Minnesota; Central City and Ord,
Nebraska; and Woodbury, Michigan. AgStar released the USBE
Subsidiaries from their obligations under $319 million of existing
indebtedness and assumed certain liabilities relating to the
AgStar Facilities.
On April 13, US BioEnergy Corporation and US Bio Marion LLC
completed the sale to Marion Energy Investments LLC, as assignee
of Dougherty and First Bank & Trust, of substantially all of the
assets relating to the Debtors' production facility in Marion,
South Dakota. The consideration for the acquired assets consisted
of release of US Bio Marion from its obligations under
approximately $93 million of existing indebtedness to the Marion
Buyers, payment by MEI of $934,861 in cash and assumption by the
Marion Purchasers of certain liabilities relating to the Marion
facility. VeraSun Bankruptcy News; Bankruptcy Creditors' Service
Inc., http://bankrupt.com/newsstand/or 215/945-7000).
VERASUN ENERGY: Proposes to Assign Pact to RBF Acquisition
----------------------------------------------------------
VeraSun Energy Corp. and its affiliates seek the Court's authority
to assume a phosphorous trading agreement with the City of St.
Peter, a municipal corporation of Nicollet County, Minnesota, and
assign the agreement to RBF Acquisition V LLC.
Mark S. Chehi, Esq., at Skadden Arps Slate Meagher & Flom LLP, in
Wilmington, Delaware, relates that after the sale of
substantially all of the Debtors' assets, RBF Acquisition
informed the Debtors that it desired to take assignment of the
Contract because it is essential to RBF's ongoing everyday
operations of the newly acquired ethanol site from the Debtors.
Mr. Chehi notes that no cure amount is owing to the Contract and
that by assuming and assigning the Contract, the Debtors will be
relieved of the obligation to make further administrative
payments associated with the Contract.
About VeraSun Energy
Headquartered in Sioux Falls, South Dakota, VeraSun Energy Corp.
-- http://www.verasun.comor http://www.VE85.com/-- produces and
markets ethanol and distillers grains. Founded in 2001, the
company has a fleet of 16 production facilities in eight states,
with 14 in operation.
The Company and its debtor-affiliates filed for Chapter 11
protection on October 31, 2008 (Bankr. D. Del. Case No. 08-12606).
Mark S. Chehi, Esq., at Skadden Arps Slate Meagher & Flom LLP
represents the Debtors in their restructuring efforts.
AlixPartners LLP serves as their restructuring advisor.
Rothschild Inc. is their investment banker and Sitrick & Company
is their communication agent. The Debtors' claims noticing and
balloting agent is Kurtzman Carson Consultants LLC. The Debtors'
total assets as of June 30, 2008, was $3,452,985,000 and their
total debts as of June 30, 2008, was $1,913,214,000.
VeraSun closed on April 1, 2009, the sale of substantially all of
its assets to Valero Renewable Fuels, a subsidiary of Valero
Energy Corporation, North America's largest petroleum refiner and
marketer. The purchased assets included five ethanol production
facilities and a development site. The facilities are located in
Aurora, South Dakota; Fort Dodge, Charles City, and Hartley, Iowa;
and Welcome, Minnesota, and the development site is in Reynolds,
Indiana.
Valero paid $350 million for the ethanol production facilities in
Aurora, Fort Dodge, Charles City, Hartley and Welcome, in addition
to the Reynolds site. Valero also successfully bid $72 million
for the Albert City facility and $55 million for the Albion
facility. The purchase price also includes working capital
and other certain adjustments.
VeraSun also completed on April 9 the sale to AgStar Financial
Services PCA of substantially all of the assets relating to the
company's production facilities in Dyersville, Iowa; Hankinson,
North Dakota; Janesville, Minnesota; Central City and Ord,
Nebraska; and Woodbury, Michigan. AgStar released the USBE
Subsidiaries from their obligations under $319 million of existing
indebtedness and assumed certain liabilities relating to the
AgStar Facilities.
On April 13, US BioEnergy Corporation and US Bio Marion LLC
completed the sale to Marion Energy Investments LLC, as assignee
of Dougherty and First Bank & Trust, of substantially all of the
assets relating to the Debtors' production facility in Marion,
South Dakota. The consideration for the acquired assets consisted
of release of US Bio Marion from its obligations under
approximately $93 million of existing indebtedness to the Marion
Buyers, payment by MEI of $934,861 in cash and assumption by the
Marion Purchasers of certain liabilities relating to the Marion
facility. VeraSun Bankruptcy News; Bankruptcy Creditors' Service
Inc., http://bankrupt.com/newsstand/or 215/945-7000).
VERASUN ENERGY: Wants Lift Stay to Disburse Funds
-------------------------------------------------
The City of Litchfield, Illinois, asks the Court to lift the
automatic stay to allow it to exercise any and all rights it may
have under a certain escrow agreement including, making demand
upon the Litchfield National Bank for disbursement of escrowed
funds.
Before the Petition Date, VeraSun Energy Corporation entered into
a water purchase agreement and an economic development agreement
with the City. Pursuant to the Contracts, the Debtor planned to
construct and operate an ethanol plant located near Litchfield,
Illinois.
Pursuant to the Water Purchase Agreement, the Debtors placed
$550,000 in an escrow account as liquidated damages for the City,
should the Debtors fail to commence construction by July 2, 2010
and deliver a notice of commencement.
On December 21, 2007, the City, VeraSun Litchfield LLC, and the
Litchfield National Bank entered into an escrow agreement,
pursuant to which the Debtors deposited the Escrow Funds, with
the Bank acting as escrow agent.
Christopher P. Simon, Esq., at Cross & Simon LLC, in Wilmington,
Delaware, contends that when the Debtors rejected corn contracts,
the City is due its liquidated damages.
As previously reported, the Debtors rejected various contracts
relating to the delivery of corn in their idle Janesville and
Welcome plants.
Mr. Simon also tells the Court that the Debtors failed to deliver
their Notice of Commencement and thus cannot complete the
anticipated construction project. Thus, the City is entitled to
its liquidated damages.
About VeraSun Energy
Headquartered in Sioux Falls, South Dakota, VeraSun Energy Corp.
-- http://www.verasun.comor http://www.VE85.com/-- produces and
markets ethanol and distillers grains. Founded in 2001, the
company has a fleet of 16 production facilities in eight states,
with 14 in operation.
The Company and its debtor-affiliates filed for Chapter 11
protection on October 31, 2008 (Bankr. D. Del. Case No. 08-12606).
Mark S. Chehi, Esq., at Skadden Arps Slate Meagher & Flom LLP
represents the Debtors in their restructuring efforts.
AlixPartners LLP serves as their restructuring advisor.
Rothschild Inc. is their investment banker and Sitrick & Company
is their communication agent. The Debtors' claims noticing and
balloting agent is Kurtzman Carson Consultants LLC. The Debtors'
total assets as of June 30, 2008, was $3,452,985,000 and their
total debts as of June 30, 2008, was $1,913,214,000.
VeraSun closed on April 1, 2009, the sale of substantially all of
its assets to Valero Renewable Fuels, a subsidiary of Valero
Energy Corporation, North America's largest petroleum refiner and
marketer. The purchased assets included five ethanol production
facilities and a development site. The facilities are located in
Aurora, South Dakota; Fort Dodge, Charles City, and Hartley, Iowa;
and Welcome, Minnesota, and the development site is in Reynolds,
Indiana.
Valero paid $350 million for the ethanol production facilities in
Aurora, Fort Dodge, Charles City, Hartley and Welcome, in addition
to the Reynolds site. Valero also successfully bid $72 million
for the Albert City facility and $55 million for the Albion
facility. The purchase price also includes working capital
and other certain adjustments.
VeraSun also completed on April 9 the sale to AgStar Financial
Services PCA of substantially all of the assets relating to the
company's production facilities in Dyersville, Iowa; Hankinson,
North Dakota; Janesville, Minnesota; Central City and Ord,
Nebraska; and Woodbury, Michigan. AgStar released the USBE
Subsidiaries from their obligations under $319 million of existing
indebtedness and assumed certain liabilities relating to the
AgStar Facilities.
On April 13, US BioEnergy Corporation and US Bio Marion LLC
completed the sale to Marion Energy Investments LLC, as assignee
of Dougherty and First Bank & Trust, of substantially all of the
assets relating to the Debtors' production facility in Marion,
South Dakota. The consideration for the acquired assets consisted
of release of US Bio Marion from its obligations under
approximately $93 million of existing indebtedness to the Marion
Buyers, payment by MEI of $934,861 in cash and assumption by the
Marion Purchasers of certain liabilities relating to the Marion
facility. VeraSun Bankruptcy News; Bankruptcy Creditors' Service
Inc., http://bankrupt.com/newsstand/or 215/945-7000).
VERASUN ENERGY: Zurich American Wants Late Claims Accepted
----------------------------------------------------------
Prior to the Petition Date, Zurich American Insurance Company,
its subsidiaries and affiliates, including but not limited to
Fidelity and Deposit Company of Maryland and Colonial American
Casualty and Surety Company, issued numerous surety bonds in
favor of various state and federal regulatory authorities at the
request of the Debtors.
The Bonds support various licenses and permits for each segment
of the Debtors' business operations. The Bonds also guarantee
certain payment and performance obligations of the Debtors to the
state and federal regulatory authorities.
In conjunction with the issuance of the Bonds, the Debtors
executed two General Agreements of Indemnity, in which the
Debtors agreed to, among other things, exonerate, indemnify and
save harmless Zurich from and against all losses, costs and
damages of whatsoever kind or nature incurred or sustained by
Zurich as a result of its having issued the Bonds.
Without the Bonds, the Debtors would be unable to operate their
businesses, Karen Lee Turner, Esq., at Eckert Seamans Cherin &
Mellott LLC, in Wilmington, Delaware, asserts.
After the deadline to file proofs of claim was established, Ms.
Turner says Zurich was not served with the Bar Date order and
accordingly did not know that the Bar Date was May 25, 2009.
Zurich has 26 claims against the estates based on the Bonds and
General Agreements of Indemnity and after learning that the Bar
Date had passed, Zurich contacted Debtors' counsel to see if they
would allow Zurich to file the claims after the Bar Date, Ms.
Turner says. The Debtors' counsel responded that it did not have
the authority to allow Zurich to file the claims late given the
Bar Date Order.
Accordingly, Zurich is filing the claims and concurrently with
its request.
By this motion, Zurich asks the Court that the 26 Proofs of Claim
be deemed as timely.
Ms. Turner submits that Zurich is entitled to file the Claims
after the Bar Date as (i) it is a known creditor and was entitled
to notice of the Bar Date and (ii) due to excusable neglect
pursuant to Rule 9006(B) of the Federal Rules of Bankruptcy
Procedure.
About VeraSun Energy
Headquartered in Sioux Falls, South Dakota, VeraSun Energy Corp.
-- http://www.verasun.comor http://www.VE85.com/-- produces and
markets ethanol and distillers grains. Founded in 2001, the
company has a fleet of 16 production facilities in eight states,
with 14 in operation.
The Company and its debtor-affiliates filed for Chapter 11
protection on October 31, 2008 (Bankr. D. Del. Case No. 08-12606).
Mark S. Chehi, Esq., at Skadden Arps Slate Meagher & Flom LLP
represents the Debtors in their restructuring efforts.
AlixPartners LLP serves as their restructuring advisor.
Rothschild Inc. is their investment banker and Sitrick & Company
is their communication agent. The Debtors' claims noticing and
balloting agent is Kurtzman Carson Consultants LLC. The Debtors'
total assets as of June 30, 2008, was $3,452,985,000 and their
total debts as of June 30, 2008, was $1,913,214,000.
VeraSun closed on April 1, 2009, the sale of substantially all of
its assets to Valero Renewable Fuels, a subsidiary of Valero
Energy Corporation, North America's largest petroleum refiner and
marketer. The purchased assets included five ethanol production
facilities and a development site. The facilities are located in
Aurora, South Dakota; Fort Dodge, Charles City, and Hartley, Iowa;
and Welcome, Minnesota, and the development site is in Reynolds,
Indiana.
Valero paid $350 million for the ethanol production facilities in
Aurora, Fort Dodge, Charles City, Hartley and Welcome, in addition
to the Reynolds site. Valero also successfully bid $72 million
for the Albert City facility and $55 million for the Albion
facility. The purchase price also includes working capital
and other certain adjustments.
VeraSun also completed on April 9 the sale to AgStar Financial
Services PCA of substantially all of the assets relating to the
company's production facilities in Dyersville, Iowa; Hankinson,
North Dakota; Janesville, Minnesota; Central City and Ord,
Nebraska; and Woodbury, Michigan. AgStar released the USBE
Subsidiaries from their obligations under $319 million of existing
indebtedness and assumed certain liabilities relating to the
AgStar Facilities.
On April 13, US BioEnergy Corporation and US Bio Marion LLC
completed the sale to Marion Energy Investments LLC, as assignee
of Dougherty and First Bank & Trust, of substantially all of the
assets relating to the Debtors' production facility in Marion,
South Dakota. The consideration for the acquired assets consisted
of release of US Bio Marion from its obligations under
approximately $93 million of existing indebtedness to the Marion
Buyers, payment by MEI of $934,861 in cash and assumption by the
Marion Purchasers of certain liabilities relating to the Marion
facility. VeraSun Bankruptcy News; Bankruptcy Creditors' Service
Inc., http://bankrupt.com/newsstand/or 215/945-7000).
X-RITE INC: Registers 58,150,640 Shares for Resale
--------------------------------------------------
X-Rite, Incorporated, filed a registration statement and
prospectus on Form S-3 in connection with the resale, from time to
time, by selling shareholders of up to 58,150,640 shares of the
Company's common stock, par value $0.10 per share. The Company
will not receive any proceeds from any sale by the selling
shareholders of the common stock covered by the prospectus and any
prospectus supplement. The selling shareholders will receive all
proceeds and will pay all underwriting discounts and commissions,
if any, applicable to the sale of the Shares.
The selling shareholders are OEPX, LLC; Sagard Capital Partners,
L.P.; Tinicum Capital Partners II, L.P.; Tinicum Capital Partners
II Parallel Fund, L.P.; and Tinicum Capital Partners II Executive
Fund L.L.C.
A full-text copy of the Registration Statement is available at no
charge at http://ResearchArchives.com/t/s?4452
As of July 4, 2009, the Company had $494.5 million in total assets
and $40.9 million in total current liabilities and $256.4 million
in total long-term liabilities.
On April 3, 2008, the Company said it was not in compliance with
certain covenants under its secured credit facilities. As a
result of the defaults, borrowings on the Company's revolving line
of credit were frozen and default interest was charged on the
first lien loan. On August 20, 2008 the Company entered into
forbearance and amendment agreements with the first and second
lien lender groups, that provided for forbearance on the defaults
through the closing of the Company's recapitalization at which
time the lenders agreed to amend the credit facilities to provide
new financial covenants and interest rates, with the amendments
effective on the date of closing of the Corporate Recapitalization
Plan. As of July 4, 2009, the Company was in compliance with the
financial covenants contained in its first and second lien credit
agreements, as amended.
About X-Rite
Based in Grand Rapids, Michigan, X-Rite Incorporated (NASDAQ:XRIT)
-- http://www.xrite.com/-- is the global leader in color science
and technology. The Company, which now includes color industry
leader Pantone, Inc., develops, manufactures, markets and supports
innovative color solutions through measurement systems, software,
color standards and services. X-Rite's expertise in inspiring,
selecting, measuring, formulating, communicating and matching
color helps users get color right the first time and every time,
which translates to better quality and reduced costs. X-Rite
serves a range of industries, including printing, packaging,
photography, graphic design, video, automotive, paints, plastics,
textiles, dental and medical.
YELLOWSTONE CLUB: Creditors Want Founder's El Tamarindo Resort
--------------------------------------------------------------
Jacqueline Palank posted at The Wall Street Journal blog,
Bankruptcy Beat, that Yellowstone Club's creditors has filed a
lawsuit against founder and former owner Timothy Blixseth, seeking
to recover the El Tamarindo resort on Mexico's Pacific Ocean
coastline or the resort's value of at least $40 million.
Court documents say that a Yellowstone Club affiliate transferred
its ownership of El Tamarindo in August 2008, a few months before
the Company filed for bankruptcy. Mr. Blixseth, Bankruptcy Beat
relates, took over control of the two companies that owned the
resort through a multi-step deal, that didn't give the Yellowstone
Club affiliate a reasonable value for the deal in the form of a
$39.995 million note and didn't pay a $5,000 cash component. The
creditors said in court documents that the transfer was intended
to "hinder, delay or defraud creditors."
Bankruptcy Beat states that Mr. Blixseth won control of El
Tamarindo as part of the divorce settlement with ex-wife Edra that
took effect in 2008.
According to Bankruptcy Beat, Michael J. Flynn, Mr. Blixseth's
lawyer, described the lawsuit as "frivolous," saying that it's
"part of this ongoing cabal of a few individuals involving his yet
angry, vicious ex-wife Edra Blixseth trying to attack her ex-
husband and it's about acrimony in a divorce action and the sequel
to that acrimony all spawned by Edra Blixseth."
Located near Big Sky, Montana, Yellowstone Club --
http://www.theyellowstoneclub.com/-- is a private golf and ski
community with more than 350 members, including Bill Gates and Dan
Quayle. The Company was founded in 1999.
Yellowstone Mountain Club LLC and its affiliates filed for
Chapter 11 on November 10, 2008 (Bankr. D. Montana, Case No. 08-
61570). The Company's owner affiliate Edra D. Blixseth, filed for
Chapter 11 on March 27, 2009 (Case No. 09-60452).
Connie Sue Martin, Esq., David A. Ernst, Esq., Lawrence R Ream,
Esq., Richard G. Birinyi, Esq., Stephen Deatherage, Esq., Thomas
L. Hutchinson, Esq., and Troy Greenfield, Esq., at Bullivant
Houser Bailey PC; and James A. Patten, Esq., at Patten, Peterman,
Bekkedahl & Green PLLC, represent the Debtors as counsel. The
Debtors hired FTI Consulting Inc. and Ronald Greenspan as CRO.
The official committee of unsecured creditors in the case are
represented by J. Thomas Beckett, Esq., and David P. Billings,
Esq., at Parsons, Behle and Latimer, as counsel, and James H.
Cossitt, Esq., at local counsel. Credit Suisse, the prepetition
first lien lender, is represented by Skadden, Arps, Slate, Meagher
& Flom.
* August Bankruptcies Continue Leveling-Off Process; Up From 2008
-----------------------------------------------------------------
Bankruptcy filings in the U.S. during August continued the
leveling-off process begun after the peak in March, though at
rates higher than 2008, Bill Rochelle at Bloomberg News said,
citing data compiled from court records by Automated Access to
Court Electronic Records.
According to AACER, August had almost 124,200 bankruptcy petitions
of all types, a 32% increase from the same month in 2008.
Corporate reorganization filings under Chapter 11 totaled 10,400
through August, more than the 10,100 recorded for 2008 as a whole,
said AACER, a service of Jupiter ESources LLC of Oklahoma City.
Commercial filings of all types were the fewest since February,
though still 28% above the same month in 2008.
Mr. Rochelle says the filings so far in 2009 work out to more than
1.4 million on an annual basis, a rate that would surpass the 1.1
million filings in 2008 by 30 percent.
* Banks Face Growing Regulatory Actions, Says MortgageDaily
-----------------------------------------------------------
Regulatory orders against financial institutions jumped 49% during
the second quarter, according to an analysis of activity by
MortgageDaily.com. A surge in civil money penalties, cease-and-
desist orders and prohibition orders fueled the increase.
U.S. institutions, their employees and former employees faced 263
regulatory actions during the second quarter, based on coverage at
MortgageDaily.com. Activity included orders issued by the FDIC,
Federal Reserve, National Credit Union Administration, OCC and
OTS.
Actions jumped 49% from the first quarter. The majority of orders
were issued by the FDIC.
Q2 2009 Q1 2009
------- -------
263 actions 177 actions
Bank failures are often preceded by cease-and-desist orders.
During the latest period, such orders jumped one-third to 86.
Financial institutions entered 64 formal agreements, up 39% from
the first quarter. Written and formal agreements often require
conservation of capital and improvement in operations. In some
cases, experienced executives must be appointed to senior lending
positions. The fed and the OCC were each responsible for around
half of second-quarter agreements.
Regulators issued 60 civil money penalties in the second quarter,
climbing from 33. Including restitution and settlements, the
latest period included $43.8 million in civil money penalties.
The FDIC issued 90 percent of the penalties.
"Despite signs that delinquency might be near a peak, the number
of regulatory orders has consistently risen during the past four
quarters -- suggesting an increase in upcoming bank failures,"
said MortgageDaily.com Founder and Publisher Sam Garcia. "So far,
nearly two dozen of the banks listed in the second-quarter report
have failed."
Type of Order No.
------------- ---
Agreement 64
Cease-and-Desist 86
Civil Money Penalty 60
Prohibition 15
Prompt Corrective Action 10
Removal-and-Prohibition 24
The FDIC was responsible for 151 of second-quarter orders, with
nearly half being cease-and-desist. The OCC issued 56 orders, and
the fed handed out 38.
Regulator No.
--------- ---
Federal Deposit Insurance Corporation 151
Federal Reserve 38
National Credit Union Administration 12
Office of the Comptroller of the Currency 56
Office of Thrift Supervision 6
The full Q2 report is available to MortgageDaily.com subscribers
at:
http://www.mortgagedaily.com/RegulatoryQ2Report090809.asp?spcode=pr
Complete regulatory news is available at:
http://www.mortgagedaily.com/news/Regulatory.asp?spcode=pr
Founded in 1998, http://www.MortgageDaily.comprovides online
mortgage news and analysis for the mortgage industry. Around 1
million news pages are viewed monthly at MortgageDaily.com and its
affiliate publications.
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
Sept. 10-11, 2009
AMERICAN BANKRUPTCY INSTITUTE
Complex Financial Restructuring Program
Hyatt Regency Lake Tahoe, Incline Village, Nevada
Contact: http://www.abiworld.org/
Sept. 10-12, 2009
AMERICAN BANKRUPTCY INSTITUTE
17th Annual Southwest Bankruptcy Conference
Hyatt Regency Lake Tahoe, Incline Village, Nevada
Contact: http://www.abiworld.org/
Oct. 2, 2009
AMERICAN BANKRUPTCY INSTITUTE
ABI/GULC "Views from the Bench"
Georgetown University Law Center, Washington, D.C.
Contact: http://www.abiworld.org/
Oct. 7-9, 2009
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
JW Marriott Desert Ridge, Phoenix, Arizona
Contact: 312-578-6900; http://www.turnaround.org/
Oct. 20, 2009
AMERICAN BANKRUPTCY INSTITUTE
NCBJ/ABI Educational Program
Paris Las Vegas, Las Vegas, Nev.
Contact: http://www.abiworld.org/
Dec. 3-5, 2009
AMERICAN BANKRUPTCY INSTITUTE
21st Annual Winter Leadership Conference
La Quinta Resort & Spa, La Quinta, California
Contact: 1-703-739-0800; http://www.abiworld.org/
Feb. 21-23, 2010
INSOL
International Annual Regional Conference
Madinat Jumeirah, Dubai, UAE
Contact: 44-0-20-7929-6679 or http://www.insol.org/
Apr. 29-May 2, 2010
AMERICAN BANKRUPTCY INSTITUTE
Annual Spring Meeting
Gaylord National Resort & Convention Center, Maryland
Contact: 1-703-739-0800; http://www.abiworld.org/
June 17-20, 2010
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort and Spa, Traverse City, Michigan
Contact: 1-703-739-0800; http://www.abiworld.org/
July 7-10, 2010
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Ocean Edge Resort, Brewster, Massachusetts
Contact: 1-703-739-0800; http://www.abiworld.org/
July 14-17, 2010
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Conference
The Ritz-Carlton Amelia Island, Amelia, Fla.
Contact: http://www.abiworld.org/
Aug. 5-7, 2010
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Workshop
Hyatt Regency Chesapeake Bay, Cambridge, Maryland
Contact: 1-703-739-0800; http://www.abiworld.org/
Oct. 6-8, 2010
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
JW Marriott Grande Lakes, Orlando, Florida
Contact: http://www.turnaround.org/
Dec. 2-4, 2010
AMERICAN BANKRUPTCY INSTITUTE
22nd Annual Winter Leadership Conference
Camelback Inn, Scottsdale, Arizona
Contact: 1-703-739-0800; http://www.abiworld.org/
Mar. 31-Apr. 3, 2011
AMERICAN BANKRUPTCY INSTITUTE
Annual Spring Meeting
Gaylord National Resort & Convention Center, Maryland
Contact: 1-703-739-0800; http://www.abiworld.org/
June 9-12, 2011
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort and Spa
Traverse City, Michigan
Contact: http://www.abiworld.org/
Dec. 1-3, 2011
AMERICAN BANKRUPTCY INSTITUTE
23rd Annual Winter Leadership Conference
La Quinta Resort & Spa, La Quinta, California
Contact: 1-703-739-0800; http://www.abiworld.org/
The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday. Submissions via
e-mail to conferences@bankrupt.com are encouraged.
Last Updated: August 10, 2009
*********
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. Danilo Munnoz, Joseph Medel C. Martirez, Denise Marie
Varquez, Philline Reluya, 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-
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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 **