/raid1/www/Hosts/bankrupt/TCR_Public/100304.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Thursday, March 4, 2010, Vol. 14, No. 62
Headlines
1ST FINANCIAL: Bank Unit Agrees to Consent Order by FDIC
ABITIBIBOWATER INC: Abandons Newfoundland Mill
ABITIBIBOWATER INC: Canadian Province Wants to Enforce EPA Orders
ABITIBIBOWATER INC: CCAA Applicants Set Second Bar Date
ABITIBIBOWATER INC: Files C$500MM NAFTA Expropriation Lawsuit
ADFITECH INC: Expects to Emerge from Bankruptcy March 15
ADVANCED MICRO: BlackRock Holds 7.06% of Common Stock
ADVANCED MICRO: Jennison Associates Holds 5.08% of Common Stock
ADVANCED MICRO: OppenheimerFunds Holds 4.44% of Common Stock
ADVANCED MICRO: Prudential Financial Holds 5.2% of Common Stock
ADVOCATE FINANCIAL: Voluntary Chapter 11 Case Summary
AIRTRAN HOLDINGS: Board Amends Bylaws on Special Meetings
AMERICAN AXLE: Barrow Hanley Reports 6.84% Equity Stake
AMERICAN AXLE: Dimensional Fund Holds 2.54% of Common Stock
AMERICAN AXLE: Eagle Asset Management Reports 5.63% Stake
AMERICAN CAPITAL: Lowers Net Loss to $910 Million in 2009
AMERICAN INT'L: Ex-Gen. Counsel Anastasia Kelly Joins DLA Piper
AMERICAN INT'L: Reports $8.9-Bil. Net Loss for Fourth Quarter
AMKOR TECHNOLOGY: S&P Affirms 'B+' Corporate Credit Rating
ARTHUR GROOM: Gets OK to Hire Shapiro & Croland as Bankr. Counsel
ASBURY AUTOMOTIVE: Earns $13.4 Million in 2009
ATLANTIC COAST: Case Summary & 2 Largest Unsecured Creditors
BANK OF NT: Fitch Downgrades Individual Rating to 'F' From 'C'
BILL HEARD: No Equitable Subrogation for BMW & Columbus Bank
BLACK GAMING: Case Summary & 4 Largest Unsecured Creditors
BLANCA LLC: Files Schedules of Assets & Liabilities
BLANCA LLC: Section 341(a) Meeting Scheduled for April 5
BLOCKBUSTER INC: Moody's Cuts Rating to 'Caa3'; Gives Neg. Outlook
BOYD GAMING: S&P Puts 'BB-' Rating on CreditWatch Negative
BREWERY PARK ASSOCIATES: Voluntary Chapter 11 Case Summary
BRIARWOOD CAPITAL: Section 341(a) Meeting Scheduled for March 23
BROADWAY BANCSHARES: Broadway Bank Might Be Closed by November
BROADWAY BANCSHARES: Needs to Raise Capital for Bank by April
BUCKHEAD COMMUNITY: Pendergast's Layng Named Chapter 7 Trustee
BUILDERS FIRSTSOURCES: Inks Employment Contract with Chad Chow
CABLEVISION SYSTEMS: RNS Has $583MM Members' Deficit at Dec. 31
CAMERON-811 RUSK: Case Summary & 11 Largest Unsecured Creditors
CASCADE ACCEPTANCE: Court Extends Plan Confirmation Deadline
CASCADE ACCEPTANCE: Files Full-but-Delayed Payment Plan
CATALYST PAPER: S&P Keeps 'CC' Corporate Credit Rating
CELL THERAPEUTICS: Stonefield Josephson Raises Substantial Doubt
CENTRAL GARDEN: S&P Assigns 'B' Rating on $400 Mil. Senior Notes
CHAMPION ENTERPRISES: Court OKs Sale to Centerbridge Group
CHIQUITA BRANDS: S&P Assigns 'BB-' Initial Senior Secured Rating
CHRYSLER LLC: To Post Slight Car Sales Increase in February
CODA OCTOPUS: Posts $9.4 Million Net Loss in FY Ended Oct. 31
COLONIAL BANCGROUP: FDIC Lambastes Schulte's Bid for Payday
COMMUNITYSOUTH FINANCIAL: Posts $18.3 Million Net Loss in 2009
COOPER-STANDARD: May Have Alternate Chapter 11 Plan
COSINE COMMUNICATIONS: Posts $597,000 Net Loss in 2009
COTT CORP: Swings to $81.5 Mil. Net Income for FY2009
CYNERGY DATA: Aims to File Liquidating Plan This Month
DAVID SOLOMONT: Voluntary Chapter 11 Case Summary
DEERWOOD HOMES: Voluntary Chapter 11 Case Summary
DENNY'S CORP: Investor Group Nominates Candidates to Board
DOLLAR THRIFTY: Extends Vehicle Supply Deal with Ford Motor
DRUG FAIR: Has Until March 29 to Propose a Chapter 11 Plan
EDWARD REID: Voluntary Chapter 11 Case Summary
ELITE BAYWOOD: Case Summary & 44 Largest Unsecured Creditors
ERICKSON RETIREMENT: Disclosure Statement Hearing on March 5
ERICKSON RETIREMENT: Ex-Employees Balk at No-Severance Plan
ERICKSON RETIREMENT: NEI Wants Info on Mechanics' Liens
ERICKSON RETIREMENT: To Replace Management Upon Emergence
FAIRFIELD RESIDENTIAL: Faces $16.9 Million Suit by Nationwide Life
FIDDLER'S CREEK: Wants Genovese Joblove as Gen. Bankr. Counsel
FIRESTONE ASSOCIATES: Sec. 341(a) Meeting Scheduled for March 25
FONTAINEBLEAU LV: Court Sets Schedule for Contract Litigation
FONTAINEBLEAU LV: Examiner Files 11th & 12th Reports
FUNERAL HOMES OF TEXAS: Voluntary Chapter 11 Case Summary
G&S CRENSHAW: Case Summary & 20 Largest Unsecured Creditors
GENERAL GROWTH: Gets Shorther 4-Month Exclusivity Extension
GENERAL MOTORS: Vice Chairman Lutz to Retire Effective May 1
GENERAL MOTORS: Appoints Selim Bingol As VP for Communications
GENERAL VISION: Management Committee Lawsuit Dismissed
GLENN MARC GALLANT: Case Summary & 20 Largest Unsecured Creditors
GOLDBERG-BAYMEADOWS: Case Summary & 20 Largest Unsecured Creditors
GTC BIOTHERAPEUTICS: Inks Note Purchase Agreement with LFB Biotech
GUIDED THERAPEUTICS: Stockholders Approves Cert. of Incorporation
HAWAIIAN TELCOM: Kirkland Charges $2.6MM for Oct.-Dec. Work
HAWAIIAN TELCOM: Lazard & FTI Bill $6.4MM for 12 Months Work
HAWAIIAN TELCOM: Proposes Incentive Payments to Union Employees
HCA INC: Fitch Assigns 'BB/RR1' Rating on $1 Bil. Note Offering
HCA INC: Moody's Assigns 'Ba3' Rating on $1 Bil. Senior Notes
HCA INC: S&P Assigns 'BB' Rating on $1 Bil. Senior Secured Notes
HIGHPOINT APARTMENTS: Case Summary & 12 Largest Unsec. Creditors
HOMELAND SECURITY: Posts $818,616 Net Income for Dec. 31 Quarter
HSM MYERS: Voluntary Chapter 11 Case Summary
HUDSON'S FURNITURE: Files for Bankruptcy to Restructure REIT Debt
IMPLANT SCIENCES: Reports $1.62-Mil. Net Loss for Dec. 31 Quarter
INERGY LP: S&P Changes Outlook to Positive; Affirms 'BB-' Rating
INTEGRITY BANK: Loans to Single Borrower Led to Demise
INTERCARGO BROKERS: Case Summary & 20 Largest Unsecured Creditors
INTERNATIONAL COAL: Moody's Upgrades Corp. Family Rating to 'Caa1'
INTERNATIONAL LEASE: Fitch Rates Issuer Default Rating at 'BB'
INTERPUBLIC GROUP: S&P Gives Positive Outlook; Affirms 'B+' Rating
JAPAN AIRLINES: Ends Cargo Business Merger Talks With NYK
JAPAN AIRLINES: Establishes Compliance Investigations Panel
JAPAN AIRLINES: Widens Operating Loss to JPY120.8-Bil. for 3Qs
K-CARM INC: Case Summary & 13 Largest Unsecured Creditors
KHORASAN LLC: Case Summary & 5 Largest Unsecured Creditors
KINDER MORGAN: Fitch Affirms NGPL'S Issuer Default & Debt Ratings
KINSLEY FOREST: Case Summary & 2 Largest Unsecured Creditors
L & G: Section 341(a) Meeting Scheduled for March 11
L & G: Files Schedules of Assets & Liabilities
LONE STAR BREWERY: Files for Ch. 11 to Avert Foreclosure
LRL CITI: Files Schedules of Assets and Liabilities
LAKE SHORE CROSSING: Case Summary & 20 Largest Unsecured Creditors
LAKEVIEW DEVELOPMENT: Case Summary & 4 Largest Unsecured Creditors
LIVINGSTON APARTMENTS: Case Summary & 13 Largest Unsec. Creditors
MAGNA ENTERTAINMENT: Exclusive Solicitation Period Until April 30
MAGNA ENTERTAINMENT: Wants to Access $7 Mil. from MI Development
MAJESTIC STAR: Awaiting Bridge & Gaming Law; Seeks Plan Extension
MALITA REALTORS: Voluntary Chapter 11 Case Summary
MALUHIA DEV'T: Files Schedules of Assets & Liabilities
MBIA INSURANCE: S&P Junks Preferred Stock Rating From 'B+'
MC PRECAST: Taps Scroggins and Williamson as Bankruptcy Counsel
MEDIACOM COMMS: Swings to $697-Mil. Income in Q4 of 2009
MELLCO INC: Case Summary & 3 Largest Unsecured Creditors
MERIDIAN RESOURCE: Amends Employment Agreement with CEO
MESA AIR: Gets Nod to Enter Into Sec. 1110(a) Stipulations
MESA AIR: Plane Leases Rejection Protocol Approved
MESA AIR: Wants Waiver From Sec. 345 Rules for Mexico Accounts
MHG CASA: MetWest SIMA Acquires Casa Madrona Hotel
MILESTONE SCIENTIFIC: K. Tucker Andersen Reports 18.2% Stake
MILESTONE SCIENTIFIC: Leonard Osser Reports 15.5% Stake
MILLIPORE CORP: Acquisition Cues S&P to Cut Merck's Ratings
MONEYGRAM INT'L: Earnings Report to Reflect Class Action Deal
MOUNTAIN 1ST BANK: Agrees to Consent Order by FDIC
MOVIE GALLERY: To Close Rochester and Cranberry Video Stores
MSCI INC: Moody's Affirms Corporate Family Rating at 'Ba2'
MSCI INC: S&P Puts 'BB' Corp. Rating on CreditWatch Negative
MSGI SECURITY: Reports $2,921,200 Net Loss for Dec. 31 Quarter
MUSICLAND HOLDING: Profit Data Irrelevant in Best Buy Suit
MERUELO MADDUX: Files Amended Joint Chapter 11 Plan
NATIONAL HOME: Has Access to Cash Collateral Until April 5
NEENAH PAPER: Moody's Reviews 'B1' Corporate Family Rating
NEENAH PAPER: S&P Puts 'B+' Rating on CreditWatch Positive
NEW UNITED MOTOR: PBGC Assumes Underfunded Pension Plan
NEXTMEDIA GROUP: Operating Unit Files Schedules of Assets & Debts
NILE THERAPEUTICS: Form 10-K Has "Going Concern" Qualification
NORTEL NETWORKS: Generates US$2 Bil.+ in Completed Asset Sales
NORTEL NETWORKS: Courts OK CVAS Business Sale to Genband
NORTEL NETWORKS: Proposes $93 Mil. Employee Incentive Plan
NORTEL NETWORKS: Wants to Enforce Stay on UK Pension Authorities
NOVA HOLDING: Has Access to West LB Cash Collateral Until March 12
NOWAUTO GROUP: Posts $522,668 Net Loss for Dec. 31 Quarter
NUTRACEA INC: Infant-Cereal Business Sold to Kerry Inc.
NUTRACEA INC: Promotes Leo G. Gingras to President
OHIO HOUSING: Moody's Downgrades Ratings on Revenue Bonds to 'Ba1'
ONEIDA LTD: $6M Chapter 11 Claim Spat Heads to 2nd Circ.
OWENS CORNING: Moody's Affirms 'Ba1' Corporate Family Rating
PACIFIC EXPRESS: Case Summary & 6 Largest Unsecured Creditors
PANELIZED BUILDING: Voluntary Chapter 11 Case Summary
PARK SUITES HOTEL: Involuntary Chapter 11 Case Summary
PARMALAT SPA: Hermes Seeks Final Settlement Approval
PARMALAT SPA: MacKenzie Cundill Wants Dividends From $1.5BB Deal
PARMALAT SPA: U.S. Court Dismisses Complaint Against BofA
PCAA PARENT: Wins Final Nod for $5 Million DIP Financing
PETER POCKLINGTON: Bankruptcy Fraud Trial Set for June 29
PRESTIGE AMERICAN: Case Summary & 20 Largest Unsecured Creditors
PRESTIGE LANDING: Case Summary & 8 Largest Unsecured Creditors
PROVO CRAFT: Moody's Assigns 'B2' Corporate Family Rating
PURPLE COMMUNICATIONS: Files Emergency Stay Request with FCC
RADIENT PHARMACEUTICALS: Board Adopts Financial Stabilization Plan
RADIENT PHARMACEUTICALS: RAB Fund Holds Less Than 5% of Shares
RAFAELLA APPAREL: Tender Offer Won't Affect Moody's Ratings
RAHAXI INC: Reports $1.47-miL. Net Loss for Dec. 31 Quarter
RANDALL PROPERTIES: Case Summary & 2 Largest Unsecured Creditors
RANJHA INC: Case Summary & 20 Largest Unsecured Creditors
RAUL FLORES INC: Voluntary Chapter 11 Case Summary
REALTY AMERICA: Case Summary & 16 Largest Unsecured Creditors
REDDY ICE: Bank Nat'l Association Executes Supplemental Indenture
REDONDO CONSTRUCTION: Court Revises Interest Calculation
REGENT BROADCASTING: Moody's Affirms 'D' Default Rating
RICHARD HAYES: Case Summary & 2 Largest Unsecured Creditors
ROYAL WEST: Owners Face SEC Charges in $135-Mil. Ponzi Scheme
SAWGRASS MARRIOTT: Global Economic Issue Prompts Bankruptcy Filing
SCO GROUP: To Sell Mobility Biz's Assets to McBride for $35,000
S.H. LEGGITT: Files Schedules of Assets & Liabilities
S.H. LEGGITT: Section 341(a) Meeting Scheduled for March 10
SHAFER PLAZA XXXVII: Case Summary & 1 Largest Unsecured Creditor
SHEARIN FAMILY: Plan of Reorganization Wins Court Approval
SIX FLAGS: Creditors Committee Opposes Plan Confirmation
SIX FLAGS: Exclusive Solicitation Period Extended Until April 5
SIX FLAGS: March 5 Hearing on Kentucky Park Leases Rejection
SIX FLAGS: SFI Noteholders Object to Plan Confirmation
SPANSION INC: Committee Supports Noteholders Financing Offer
SPANSION INC: Further Modifies Reorganization Plan
SPANSION INC: Has Deal With Bank of America on Claims Treatment
SPANSION INC: Noteholders Want Examiner or Trustee
SPANSION INC: Elpida Acquires NAND Flash Memory Assets
STATION CASINOS: Extends Deal With PropCo Until May 12
STATION CASINOS: GCR Gaming Wants GV Ranch Case Dismissed
STATION CASINOS: Reaches Deal With Lenders, To File Reorg. Plan
TEKOIL & GAS: Court Sets Plan Confirmation Hearing on March 23
TORTILLA INC: Case Summary & 20 Largest Unsecured Creditors
TP INC: Case Summary & 3 Largest Unsecured Creditors
TRIBUNE CO: Seeks Dismissal of New River Chapter 11 Case
TRIBUNE CO: Wantsto Modify Ernst & Young Scope of Work
TRIBUNE CO: Wants Until July 1 to Remove Civil Actions
TROPICANA ENTERTAINMENT: Adamar Can Decide on Leases by March 31
TROPICANA ENTERTAINMENT: Adamar Wants to Reject 63 Contracts
TROPICANA ENTERTAINMENT: Adamar Has Cash Access Until March 31
UAL CORP: Capital World Has 7.4% Equity Stake
UAL CORP: FMR LLC Has 15% Equity Stake
UAL CORP: Janus Capital Has 12% Equity Stake
UAL CORP: Par Investment Has 5.63% Equity Stake
UNIVERSAL PACKAGING LDS: Voluntary Chapter 11 Case Summary
VIKING SYSTEMS: Squar Milner Raises Going Concern Doubt
WABASH NATIONAL: Schneider Capital Holds 5.69% of Common Stock
WABASH NATIONAL: Tontine Funds Hold 0.92% of Common Stock
WABASH NATIONAL: Dimensional Fund Advisors Holds 7.14% Stake
WABASH NATIONAL: Franklin Resources Holds 11.1% of Common Stock
WABASH NATIONAL: Stephanie Kushner to Step Down From Board
WE & MK SHIELDS: Voluntary Chapter 11 Case Summary
WEST SIDE: Files for Bankruptcy to Eliminate $1.4 Million Debt
WHITTAKER LAUDERDALE: Voluntary Chapter 11 Case Summary
W.R. GRACE: Canada Courts Gives Final Nod for ZAI Settlement
W.R. GRACE: Reports $71.2 Million Net Income for 2009
XENITH BANKSHARES: Gets Notice of Decision by NASDAQ
ZANETT INC: Expects to Receive Delisting Notice
ZAYAT STABLES: Gets Cash for Operations After Fifth Third Accord
ZAYO GROUP: Moody's Assigns Corporate Family Rating at 'B2'
* Canadian Bankruptcies Down 8.6% in December
* 14 CCAA Proceedings Commenced in 2009 Fourth Quarter
* Commercial Bankruptcy Filings Unchanged in February 2010
* S&P Expects Default Rate to Decline to 5% by December 2010
* Mortgage Delinquencies Continue to Increase
* Donlin Recano Hires Mark Schindel as Director in Chicago Office
* Former AIG Gen. Counsel Anastasia Kelly Joins DLA Piper
* Chapter 11 Cases with Assets & Liabilities Below $1,000,000
*********
1ST FINANCIAL: Bank Unit Agrees to Consent Order by FDIC
--------------------------------------------------------
Effective February 25, 2010, Mountain 1st Bank & Trust Company, a
wholly owned subsidiary of 1st Financial Services Corporation,
agreed to the issuance of a Consent Order with the Federal Deposit
Insurance Corporation and the North Carolina Commissioner of
Banks.
1st Financial said in a filing with the Securities and Exchange
Commission that the Consent Order was entered into and became
effective on February 25, 2010, and the Bank was notified of the
Order's effectiveness on March 1, 2010.
Mike Mayer, the recently appointed Chief Executive Officer of the
Company and the Bank, stated: "Our Board of Directors and
management team are united in our efforts to satisfy the
requirements of the Consent Order in the coming months. We have
already fulfilled a number of the conditions for the release of
the Order. Our goal is to complete our return to good standing as
quickly as possible."
Mr. Mayer also said, "We continue to meet the applicable
regulatory capital requirements and we continue to meet the
banking needs of our customers and communities. We will not lose
our focus on achieving excellence in serving Western North
Carolina."
Although the Bank neither admitted nor denied any unsafe or
unsound banking practices or violations of law or regulation, it
agreed to the Consent Order, which requires it to undertake a
number of actions:
* The Board of Directors of the Bank will enhance its
supervision of the Bank's activities, including by increasing
the formality of its meetings and appointing a special
Directors' Committee. The Committee will oversee the efforts
of the Bank's management in complying with the Consent Order
and will regularly report to the full Board.
* The Bank Board will assess the Bank's management team to
ensure that the Bank's executive officers have the skills,
training, abilities and experience needed to cause the Bank
to comply with the Consent Order, operate in a safe and sound
manner, comply with applicable laws and regulations, and
strengthen all areas of the Bank's operations that are not
currently in compliance with the Consent Order. The Board
will also assess the Bank's management and staffing needs in
order to determine if additional resources should be added to
the management team.
* During the effectiveness of the Consent Order, the Bank will
maintain Tier 1 Capital of at least 8% of total assets, a
Total Risk Based Capital Ratio of at least 12% and a fully
funded allowance for loan and lease losses (the "allowance").
* The Bank will develop and implement a plan for achieving and
maintaining the foregoing capital levels, which plan may
include sales of stock by the Company and contributions of
the sales proceeds by the Company to the capital of the Bank.
* The Board will strengthen the allowance policy of the Bank,
periodically review the Bank's allowance to determine its
adequacy and enhance its periodic reviews of the allowance to
ensure its continuing adequacy. Deficiencies noted will be
promptly remedied by charges to earnings. In addition, the
allowance has been increased as required by the Consent
Order.
* The Bank will develop and implement a strategic plan covering
at least three years and containing long-term goals designed
to improve the condition of the Bank.
* The Bank charged off all of its assets (loans) classified
"Loss" and 50% of its assets (loans) classified "Doubtful"
promptly following the effectiveness of the Consent Order.
The Bank anticipates that the remainder of the "Doubtful"
assets (loans) will be charged off during the remainder of
2010.
* The Bank will not extend additional credit to any borrower
who had a loan with the Bank that was charged off or who has
a current loan that is classified "Loss" or "Doubtful". The
Bank also will not extend additional credit to any borrower
who has a current loan that is classified "Substandard" or
listed for "Special Mention." A further extension of credit
may be made to a borrower with a "Substandard" or "Special
Mention" loan if the Bank Board determines such extension
would be in the best interests of the Bank.
* The Bank will formulate a detailed plan to collect, charge
off or improve the quality of each of its "Substandard" or
"Doubtful" loans as of August 31, 2009, of more than $250,000
and will promptly implement the plan. The Board will closely
monitor the Bank's progress in fulfilling the requirements of
this plan.
* The Bank will reduce loans in excess of $250,000 and
classified as "Substandard" or "Doubtful" in accordance with
a schedule required by the supervisory authorities. The
schedule targets an aggregate reduction by 75% within 720
days of the effectiveness of the Consent Order. The Board
will monitor this effort on a monthly basis.
* The Bank will cause full implementation of its loan
underwriting, loan administration, loan documentation and
loan portfolio management policies within 90 days of the
effectiveness of the Consent Order.
* The Bank will adopt a loan review and grading system within
90 days of the Consent Order to provide for effective
periodic reviews of the Bank's loan portfolio. The system
will address, among other things, loan grading standards,
loan categorization, and credit risk analyses.
* Within 30 days of the effectiveness of the Consent Order, the
Bank will develop a plan to systematically reduce the
concentration of a significant portion of its extensions of
credit in a limited group of borrowers. Additionally, the
Bank will prepare a risk segmentation analysis with respect
to certain real estate industry concentrations of credit
identified by the supervisory authorities.
* The Bank will enhance its review of its liquidity by engaging
in monthly analyses. It will also develop and implement a
liquidity contingency and asset/liability management plan.
* Within 90 days from the effectiveness of the Consent Order,
the Bank will implement a plan and 2010 budget designed to
improve its net interest margin, increase interest income,
reduce expenditures and improve and sustain earnings.
* The Bank will implement internal routine and control policies
addressing concerns raised by its supervisory authorities and
designed to enhance its safe and sound operation.
* Within 90 days of the Consent Order, the Bank will implement
a comprehensive internal audit program and cause an effective
system of internal and external audits to be in place.
* The Bank will implement a policy for managing its "owned real
estate".
* The Bank will forebear from soliciting and accepting
"brokered deposits" unless it first receives an appropriate
waiver from the FDIC; and will comply with restrictions
issued by the FDIC on the effective yields of deposit
products offered by, among others, banks subject to consent
orders.
* A limit upon growth of 10% per year will be observed by the
Bank.
* The Bank will not pay dividends or make other forms of
payment reducing capital to the Company without the prior
approval of the supervisory authorities while the Consent
Order is in effect.
* The Bank will implement policies to enhance the Board's focus
on conflicts of interest regulations and its handling of
transactions with officers and directors.
* The Bank will correct any violations of laws and regulations
identified by the supervisory authorities.
* The Bank will make quarterly progress reports to the
supervisory authorities detailing the form and manner of
actions taken to comply with the Consent Order.
The plans, policies and procedures which the Bank is required to
prepare under the Consent Order are subject to approval by the
supervisory authorities before implementation.
Allowance for Losses
The Bank said it intends to increase the Allowance for Loan Losses
by approximately $11 million for the 4th quarter of 2009. This
increase in the ALLL is the result of an exhaustive internal and
external loan review process coupled with the implementation of
new, automated loan loss software. This software will now allow
the Bank to continuously update its allowance and provide prompt,
accurate measurement and guidance of the loan portfolio moving
forward. Said Mr. Mayer, "As we continued to analyze our loan
portfolio, we felt it important to not only update our internal
capabilities for reviewing our portfolio, but to also engage Risk
Management Group to provide an independent third party review.
Both of these reviews led us to the same decision to increase our
loan loss allowance to cushion against any potential further
deterioration in the loan portfolio." With the increase, the Bank
will now have an ALLL of over $28 million against approximately
$34 million in non-performing loans at December 31, 2009.
About 1st Financial
Formed in May 2008, 1st Financial Services Corporation --
http://www.mountain1st.com/-- is the parent company of Mountain
1st Bank & Trust Company, and is currently traded on the Over The
Counter Bulletin Board under the symbol FFIS. Established in May
of 2004, with approximately $800 million in assets, Mountain 1st
Bank and Trust's more than 173 employees serve ten counties in
western North Carolina through 15 full service branches.
ABITIBIBOWATER INC: Abandons Newfoundland Mill
----------------------------------------------
In a related report dated February 8, 2010, CBC News Canada noted
that AbitibiBowater Inc. has decided to abandon its mill and two
other properties in the central Newfoundland town of Grand Falls-
Windsor in Newfoundland and Labrador Province, in Canada. The
Company has informed the provincial governments of Newfoundland
and Labrador of its decision, the report related.
According to CBC News, acting premier Kathy Dunderdale, who is
also the natural resources minister, confirmed on February 5,
2010, that AbitibiBowater "would no longer be accepting
responsibility for security and maintenance of the mill, which
closed in March 2009." Ms. Dunderdale said the Newfoundland
government will assume responsibility for, and didn't intend to
expropriate, the Properties because the government "was only
interested [in] the power-generating assets."
"By not including descriptive language to specifically exempt
these other properties, the province assumed legal ownership of
them," Ms. Dunderdale noted, according to the CBC News report.
The provincial government, with the support of opposition members
of the legislature, passed urgent legislation in December 2008 to
expropriate all AbitibiBowater assets in the province of
Newfoundland, except the mill and the two other properties, CBC
News Canada added.
The news source also noted that Ms. Dunderdale has disclosed that
AbitibiBowater is appealing an order from the provincial
Environment Department "to come up with an environmental
remediation plan for the properties." Ms. Dunderdale insisted
the provincial government's taking control of the mill and
certain other properties does not free AbitibiBowater of its
environmental obligations of the properties.
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 28 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 Sept. 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: Canadian Province Wants to Enforce EPA Orders
-----------------------------------------------------------------
Abiti-Consolidated Inc. and its Canadian affiliates and their
predecessors carried on industrial activity in the Province of
Newfoundland and Labrador since at least 1905. As a result, the
Applicants have incurred statutory obligations to the Province for
environmental remediation, which are noted in orders issued on
November 12, 2009, by Her Majesty the Queen in Right of the
Province of Newfoundland and Labrador, through the Minister of
Environment and Conservation in the Province and pursuant to the
Canadian Environmental Protection Act.
The EPA Orders require the Applicants to submit a detailed
Remediation Action Plan for certain sites; complete approved site
remediation actions; and close all landfills and lagoons or
impoundments associated with the Sites within certain specified
timelines.
Specifically, the EPA Orders related to:
(i) the mining and processing of minerals at the Buchans mine,
(ii) the pulp and paper operations at the Grand Falls-Windsor
mill,
(iii) the pulp and paper operations at the Stephenville mill,
(iv) the shipping and storing operations at the Botwood site,
and
(v) logging camps at approximately 50 different locations
across the Province,
all of which were either no longer owned or used by the
Applicants in their business.
The Province contended that the Applicants' industrial activities
resulted in the release of substances into the environment in
amounts, concentrations and at rates that have caused and will,
in the future, continue to cause, an adverse effect both on and
adjacent to the Sites.
The Claims Procedure Order which the Canadian Court approved on
August 26, 2009, established the procedures for filing proofs of
claim and the procedures for determining the nature, validity and
scope of prepetition claims. According to the Province, it is
possible to interpret the Claims Procedure Order as
"inconsistent" with the order granting the CCAA Applicants
protection from their creditors, or the Initial Stay Order, which
permits the Province to issue non-monetary orders that require
the Applicants to comply with statutory environmental
obligations. Moreover, the Claims Procedure Order might bar,
extinguish or otherwise affect the enforceability of the Initial
Stay Order, the Province notes.
To avoid this result, the Province sought a declaration on
February 15, 2010, clarifying that:
(1) the Claims Procedure Order will not bar, extinguish or
otherwise affect the enforceability of orders made against
the Debtors, the Property or the Directors, as defined
under the Initial Stay Order, by Her Majesty the Queen in
Right of the Federal or a provincial government pursuant
to her exercise of powers, rights or duties in relation to
matters involving public health, safety, security, public
order or the environment; and
(2) for greater certainty, the EPA orders are not barred or
extinguished, and their enforceability is not otherwise
affected, by the Claims Procedure Order.
Contesting the Province's request, the Applicants maintained that
the Initial Stay Order, as amended, provides that until and
including March 15, 2010, no right may be exercised and no
proceeding may be commenced or proceeded with by anyone,
including any government, administration or entity exercising
executive, legislative, judicial, regulatory or administrative
functions against, or with respect to, them or any of their
present or future property, assets, rights and undertakings.
The Applicants averred that the EPA Orders fall within "Paragraph
10 of the Initial Stay Order" and are therefore stayed.
Accordingly, the Applicants asked the Canadian Court to:
(1) dismiss the Province's EPA Motion, with costs;
(2) confirm that the EPA Orders are stayed;
(3) confirm that the Province's filing of any claim based on
the EPA Orders is barred by the Claims Procedure Order;
and
(4) further confirm that no extension of the Claims Bar Date
will be granted to allow the Province to file a claim.
Monitor's Opinion
Ernst & Young, the Court-appointed monitor in the Canadian
proceedings of the CCAA Applicants, noted that there is "a need
in all Court-supervised CCAA restructurings to strike a balance
between various stakeholders affected by particular decisions,
all operating within the established federal and provincial
legislative schemes."
Approval of the Province's EPA Motion will allow the Province to
"escape the restructuring process unscathed, whereas the costs of
the remediation will be visited upon the Applicants, their
estates and, ultimately, all other stakeholders, without any
corresponding benefit," E&Y Vice President Alex Morrison stated
in a 34th Monitor Report submitted to the Canadian Court.
Furthermore, the Monitor believes that if the Province is
successful in its Motion, the ability of the Applicants to affect
a successful restructuring will be negatively affected, including
by a reallocation of value in favor of the Province, by increased
difficulty in securing exit financing and by additional delays,
potential complications and increased costs.
On the other hand, the Monitor notes, if the pre-filing
obligations of the Applicants with respect to the potential
remediation costs for the unused properties are found to be
compromisable obligations, and if a claim is filed on a timely
basis or if allowed as a late claim, the Province would share
distribution on a pro rata basis with a class of similar
creditors.
Moreover, the Province would be entitled to participate in the
formulation, negotiation and implementation of any restructuring
plan, the Monitor notes.
A full-text copy of E&Y's 34tn Monitor Report is available for
free at http://bankrupt.com/misc/CCAA_34thMonitorReport.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 28 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 Sept. 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: CCAA Applicants Set Second Bar Date
-------------------------------------------------------
Abiti Consolidated Inc. and other Abitibi units that are CCAA
applicants sought and obtained from the Honorable Mr. Justice
Clement Gascon, J.S.C., of the Superior Court Commercial Division
for the District of Montreal in Quebec, Montreal, Canada, an order
designating April 7, 2010, as the "Second Claims Bar Date," which
date will be made applicable to any person asserting Applicable
Claims:
(a) which were not subject to the First Claims Bar Date of
November 13, 2009, including any claim, subsequent claim,
or restructuring claim held by employees who were employed
by a CCAA Applicant as at April 16, 2009, or thereafter;
and
(b) (i) arising as a result of, or in connection with, the
repudiation, breach, termination or restructuring by the
CCAA Applicants after August 31, 2009, of any pension or
retirement plan or benefit established for the Applicants'
Canadian employees; (ii) arising as a result of payments
deferred pursuant to the Canadian Court's May 8, 2009
order authorizing the suspension of certain payments to
the pension plans; and (iii) against any of the Applicants
as a former owner, occupier, person in possession or
otherwise in connection with any property transferred on
or after April 17, 2009.
The CCAA Applicants proposed that the Second Claims Bar Date
succeeds the November 13, 2009 First Claims Bar Date, which was
established as the deadline for filing of general creditors'
claims in the CCAA Proceeding. The CCAA Applicants also proposed
the Second Claims Process which outlines, among other things, the
procedures by which specified creditors can assert claims against
the Applicants and the terms of priority with respect to the
Cross-Border Debtors.
"Applicable Claims" refer to any claim held by (i) the lenders
under the senior secured term loan due March 30, 2009, under
which Abitibi-Consolidated Company of Canada is the borrower and
Wells Fargo N.A. is the administrative agent, (ii) the lenders
under a five-year $381 million revolving credit facility under
which Bowater Inc., is the borrower and Wachovia Bank N.A. is the
administrative agent, and (iii) the lenders under the credit
agreement under which BCFPI is the borrower and the Bank of
Nova Scotia is the administrative agent.
An Applicable Claim will not include "Excluded Claims,"
consisting of:
-- any Claim secured by the Abitibi Administration Charge, the
Bowater Administration Charge, the Abitibi and Bowater D&O
Charge, the Abitibi-Consolidated Inc. DIP Charge or the
Bowater Inc. DIP Lenders Charge, as each is defined under
the Initial Stay Order entered by the Canadian Court on
April 17, 2009;
-- any Intercompany Claim, including those secured by the ACI
Intercompany Advances Charge and the Bowater Intercompany
Advances Charge, as each is defined under the Initial Stay
Order;
-- any claim for amounts owed in respect of ordinary course
payroll obligations or for the reimbursement of expenses
scheduled to be paid in the ordinary course; and
-- any other claim ordered by the Canadian Court to be treated
as an Excluded Claim.
Monitor Recommended Approval of Second Bar Date,
Presented January 4 to 31, 2010 Cash Flow Results
In its 32nd report submitted to the Canadian Court, Ernst &
Young, the Court-appointed monitor in the Canadian proceedings of
the CCAA Applicants, recommended approval of the Second Claims
Bar Date as well as the Second Claims Process governing the
review and determination of Applicable Claims.
The Monitor held that the Second Claims Bar Date and the Second
Claims Process will enable the CCAA Applicants to adequately
formulate a plan of compromise or arrangement.
Under the 33rd Monitor Report, E&Y Vice President Alex Morrison
apprised the Canadian Court of the CCAA Applicants' four-week
cash flow results for the period from January 4 to 31, 2010.
As of January 31, 2010, Abitibi-Consolidated Inc. Group's actual
overall ending cash balance of $274,774,000 and immediately
available liquidity of $292,774,000 were each approximately
$30.1 million higher than the ACI forecast. On the other hand,
Bowater Canada Forest Products, Inc. Group's ending cash balance
at $14,075,000 was approximately $3.7 million lower than the BCFPI
forecast, the Monitor related.
The ACI Group's Immediately Available Liquidity at May 2, 2010,
which is the end of the 13-week period forecast, is projected to
be approximately $216.1 million. BCFPI's liquidity as of May 2,
2010, is projected to be approximately $10.1 million, not
including the proceeds relating to the sale of certain
timberlands by Smurfit-Stone Container Canada Inc., Mr. Morrison
told the Canadian Court.
Full-text copies of E&Y's 32nd and 33rd Monitor Reports are
available for free at:
http://bankrupt.com/misc/CCAA_32ndMonitorReport.pdf
http://bankrupt.com/misc/CCAA_33rdMonitorReport.pdf
* * *
In an official statement dated February 24, 2010, AbitibiBowater
said that the Canadian Court has approved the CCAA Applicants'
request. Mr. Justice Gascon established April 7, 2010 as the
Second Claims Bar Date and approved the Second Claims Process.
The Canadian Court also directed the Monitor and Epiq Bankruptcy
Solutions, LLC, as the Applicants' claims agent, to mail proof of
claim packages to all known specified creditors.
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 28 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 Sept. 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: Files C$500MM NAFTA Expropriation Lawsuit
-------------------------------------------------------------
AbitibiBowater filed on February 25, 2010, a Notice of
Arbitration under the North American Free Trade Agreement or
NAFTA with regards to the expropriation of its assets and rights
in Newfoundland and Labrador, Canada. The Company contends that
the provincial government's enactment in December 2008 of Bill
75, which expropriates an extensive array of its rights and
assets, was arbitrary, discriminatory and illegal under
international law.
The Claim seeks direct compensation for damages of approximately
C$500 million, plus additional costs and relief deemed just and
appropriate by the Arbitral Tribunal. This is one of the largest
claims ever filed against Canada under NAFTA. Under
international law, the Canadian Federal Government is responsible
for the actions of Newfoundland and Labrador in violation of the
investment protection provisions of NAFTA.
In early December 2008, AbitibiBowater announced capacity-
reduction measures in Canada and the United States, including the
permanent closure of its Grand Falls-Windsor, Newfoundland and
Labrador mill, due to the economic downturn and decline in
product demand. In retaliation, the province hastily passed Bill
75, without any attempt to consult with the Company and without
holding any public hearings.
The Company has asserted in the Notice of Arbitration that the
province's Bill 75 unquestionably breaches Canada's NAFTA
obligations on a number of grounds, including, among others:
(1) Unlawful Expropriation: NAFTA explicitly details the
grounds under which government expropriation can lawfully
occur. The criteria for lawful expropriation were not met
by the Government of Newfoundland and Labrador in Bill 75.
(2) Fair Compensation: Under NAFTA, AbitibiBowater is entitled
to compensation "without delay" for the "fair market
value" of each of its expropriated investments. Bill 75
does not ensure payment for the fair market value of the
expropriated rights and assets.
(3) Treatment in Accordance with International Law: NAFTA
obliges Canada to provide treatment "in accordance with
international law," which includes international standards
of "fair and equitable treatment." The Bill's seizure of
AbitibiBowater's rights and assets was arbitrary,
irrational and discriminatory, in violation of these
standards.
(4) Denial of Justice: Bill 75 purports to strip
AbitibiBowater of any rights to access the courts, which
is independently a violation of NAFTA.
(5) Discrimination: AbitibiBowater should be afforded the same
rights and privileges as all other domestic and foreign
investors. Bill 75 is retaliatory in nature and
discriminates against the Company.
"The expropriation was detrimental to the financial position of
our Company," stated David J. Paterson, President and Chief
Executive Officer. "After operating in Newfoundland and Labrador
for more than a century and contributing significantly to the
region's economic, social and sustainable development, the
nationalization of AbitibiBowater's assets was unexpected and
unnecessary."
"AbitibiBowater has been engaged with the Government of Canada
and the Government of Newfoundland and Labrador in an effort to
achieve a fair and equitable settlement and avoid a protracted
NAFTA case. Unfortunately, despite those extensive discussions,
we are unable to resolve the matter at this time and the Company
has no choice but to file a formal claim under NAFTA," added Mr.
Paterson.
"It is our obligation to defend the interests of our stakeholders
and ensure we receive compensation for the fair market value of
the expropriated assets, plus additional damages. We are
disappointed that a settlement acceptable to all parties has not
yet been reached and we still hope that this issue can be
resolved by a negotiated settlement with the Government of
Canada," Mr. Paterson concluded.
The expropriation relates to a broad range of AbitibiBowater's
rights and assets in Newfoundland and Labrador, including land
rights, timber rights, water use rights and various other related
rights and business partnerships. These rights and assets can be
traced back in part to grants by the provincial government and
its predecessors, as well as to numerous third-party
transactions.
In addition to the substantial sums it expended to acquire these
rights, the Company has invested hundreds of millions of dollars
in the province over the last century, ranging from capital
investments in mill and hydroelectric generation operations to
road projects that have helped build rural Newfoundland.
Since the Company is incorporated in the state of Delaware and
carries out business activities in the United States, the
expropriation of rights and assets represents a breach of
Canada's obligations to a U.S. investor under Chapter Eleven of
NAFTA.
AbitibiBowater has been involved in consultations with the State
Department, Treasury Department, the Department of Commerce, and
the U.S. Trade Representative since the expropriation. In an
official statement, the U.S. State Department expressed concern
about the action. As well, at a recent investment conference,
representatives from the States of Alabama, Mississippi,
Tennessee, Georgia and South Carolina also raised the
expropriation with officials from the Governments of Canada and
Newfoundland and Labrador.
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 28 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 Sept. 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).
ADFITECH INC: Expects to Emerge from Bankruptcy March 15
--------------------------------------------------------
The United States Bankruptcy Court for the District of Maryland
entered its Order confirming ADFITECH, Inc.'s Second Amended
Chapter 11 Plan of Reorganization. The Bankruptcy Court held a
confirmation hearing with respect to the Plan on February 24,
2010, and the Bankruptcy Court entered its Order confirming the
Plan on March 2, 2010. It is currently expected that the
effective date of the Plan will be March 15, 2010. As
contemplated in the Plan, ADFITECH is expected to emerge from its
Chapter 11 case on or about the effective date as a new Delaware
corporation.
Samuel Meek, the President of ADFITECH, stated: "We are pleased
that ADFITECH is on the verge of emerging successfully from
chapter 11, and the management and employees of ADFITECH look
forward to continuing to serve our loyal clients as an independent
company."
ADFITECH will become an independently owned company, managed by a
newly formed board of directors. "The board is excited to be
involved in such a well respected company like ADFITECH. We look
forward to supporting ADFITECH's efforts to continue to grow the
product offerings and improve the services and technologies
already in place," commented Jay H. Lustig, ADFITECH's newly
appointed Chairman of the Board.
ADFITECH will continue to supply quality control functions,
defaulted loan review services, fulfillment and imaging.
ADFITECH, which has 480 employees, will continue to operate in
Edmond, OK. ADFITECH services over 400 mortgage lenders, banks
and other industry entities.
About Adfitech
Adfitech was an independently operated, wholly owned subsidiary of
TMST Home Loans, Inc., formerly known as Thornburg Mortgage Home
Loans, Inc., and provides mortgage-related auditing and quality
control consulting services to financial institutions. Adfitech
is self-funded, has its own separate workforce and bank accounts,
and operates independently from the TMST Debtors including TMST
and TMHL at offices located in Edmond, Oklahoma on unencumbered
real estate owned by Adfitech.
As of October 31, 2009, Adfitech had total assets of $30,807,613
against total liabilities of $1,639,994,390. As of the petition
date, Adfitech had total assets of $28,026,037 against total
liabilities of $1,639,832,523.
Thornburg Mortgage, Inc., now known as TMST, Inc., and its four
affiliates filed for Chapter 11 on May 1 (Bankr. D. Md. Lead Case
No. 09-17787). Judge Duncan W. Keir is handling the case.
On November 2, 2009, the Bankruptcy Court entered an Order
Severing Joint Administration with Respect to the Adfitech Chapter
11 Case. As a result, the Adfitech Chapter 11 case is no longer
jointly administered with the cases of the TMST Debtors.
ADVANCED MICRO: BlackRock Holds 7.06% of Common Stock
-----------------------------------------------------
BlackRock Inc. disclosed that as of December 31, 2009, it may be
deemed to beneficially own 48,700,297 shares or roughly 7.06% of
the common stock of Advanced Micro Devices Inc.
Headquartered in Sunnyvale, California, Advanced Micro Devices
Inc. (NYSE: AMD) -- http://www.amd.com/-- provides innovative
processing solutions in the computing, graphics and consumer
electronics markets.
AMD swung to a $293 million net income for the fiscal year ended
December 26, 2009, after posting net losses in 2006, 2007 and
2008. AMD reported a net loss of $3.096 billion in fiscal 2008;
$3.359 billion in fiscal 2007; and $138 million in fiscal 2006.
As of December 26, 2009, the Company had total assets of
$9.078 billion against total current liabilities of
$2.210 billion; deferred income taxes of $197 million; long-term
debt and capital lease obligations, less current portion of
$4.252 billion; other long-term liabilities of $695 million; and
noncontrolling interest of $1.076 billion; resulting in
stockholders' equity of $648 million.
* * *
As reported by the Troubled Company Reporter on October 7, 2009,
Standard & Poor's Ratings Services affirmed Advanced Micro's
'CCC+' corporate credit rating and revised its outlook to positive
from negative.
ADVANCED MICRO: Jennison Associates Holds 5.08% of Common Stock
---------------------------------------------------------------
Jennison Associates LLC disclosed that as of December 31, 2009, it
may be deemed to beneficially own 34,041,376 shares or roughly
5.08% of the common stock of Advanced Micro Devices Inc.
Jennison Associates furnishes investment advice to several
investment companies, insurance separate accounts, and
institutional clients. As a result of its role as investment
adviser of the Managed Portfolios, Jennison may be deemed to be
the beneficial owner of the shares of AMD Common Stock held by
such Managed Portfolios. Prudential indirectly owns 100% of
equity interests of Jennison. As a result, Prudential may be
deemed to have the power to exercise or to direct the exercise of
such voting or dispositive power that Jennison may have with
respect to the AMD Common Stock held by the Managed Portfolios.
Jennison does not file jointly with Prudential, as such, shares of
AMD Common Stock reported by Jennison may be included in the
shares reported on the 13G filed by Prudential. The shares were
acquired in the ordinary course of business, and not with the
purpose or effect of changing or influencing control of AMD.
About Advanced Micro Devices
Headquartered in Sunnyvale, California, Advanced Micro Devices
Inc. (NYSE: AMD) -- http://www.amd.com/-- provides innovative
processing solutions in the computing, graphics and consumer
electronics markets.
AMD swung to a $293 million net income for the fiscal year ended
December 26, 2009, after posting net losses in 2006, 2007 and
2008. AMD reported a net loss of $3.096 billion in fiscal 2008;
$3.359 billion in fiscal 2007; and $138 million in fiscal 2006.
As of December 26, 2009, the Company had total assets of
$9.078 billion against total current liabilities of
$2.210 billion; deferred income taxes of $197 million; long-term
debt and capital lease obligations, less current portion of
$4.252 billion; other long-term liabilities of $695 million; and
noncontrolling interest of $1.076 billion; resulting in
stockholders' equity of $648 million.
* * *
As reported by the Troubled Company Reporter on October 7, 2009,
Standard & Poor's Ratings Services affirmed Advanced Micro's
'CCC+' corporate credit rating and revised its outlook to positive
from negative.
ADVANCED MICRO: OppenheimerFunds Holds 4.44% of Common Stock
------------------------------------------------------------
OppenheimerFunds, Inc., disclosed that it may be deemed to
beneficially own 29,793,223 shares or roughly 4.44% of the common
stock of Advanced Micro Devices Inc.
Headquartered in Sunnyvale, California, Advanced Micro Devices
Inc. (NYSE: AMD) -- http://www.amd.com/-- provides innovative
processing solutions in the computing, graphics and consumer
electronics markets.
AMD swung to a $293 million net income for the fiscal year ended
December 26, 2009, after posting net losses in 2006, 2007 and
2008. AMD reported a net loss of $3.096 billion in fiscal 2008;
$3.359 billion in fiscal 2007; and $138 million in fiscal 2006.
As of December 26, 2009, the Company had total assets of
$9.078 billion against total current liabilities of
$2.210 billion; deferred income taxes of $197 million; long-term
debt and capital lease obligations, less current portion of
$4.252 billion; other long-term liabilities of $695 million; and
noncontrolling interest of $1.076 billion; resulting in
stockholders' equity of $648 million.
* * *
As reported by the Troubled Company Reporter on October 7, 2009,
Standard & Poor's Ratings Services affirmed Advanced Micro's
'CCC+' corporate credit rating and revised its outlook to positive
from negative.
ADVANCED MICRO: Prudential Financial Holds 5.2% of Common Stock
---------------------------------------------------------------
Prudential Financial, Inc., disclosed that it may be deemed to
beneficially own 34,922,338 shares or roughly 5.2% of the common
stock of Advanced Micro Devices Inc.
Prudential said the shares are held for its own benefit or for the
benefit of its clients by its separate accounts, externally
managed accounts, registered investment companies, subsidiaries or
other affiliates. The shares were acquired in the ordinary course
of business, and not with the purpose or effect of changing or
influencing control of AMD.
About Advanced Micro Devices
Headquartered in Sunnyvale, California, Advanced Micro Devices
Inc. (NYSE: AMD) -- http://www.amd.com/-- provides innovative
processing solutions in the computing, graphics and consumer
electronics markets.
AMD swung to a $293 million net income for the fiscal year ended
December 26, 2009, after posting net losses in 2006, 2007 and
2008. AMD reported a net loss of $3.096 billion in fiscal 2008;
$3.359 billion in fiscal 2007; and $138 million in fiscal 2006.
As of December 26, 2009, the Company had total assets of
$9.078 billion against total current liabilities of
$2.210 billion; deferred income taxes of $197 million; long-term
debt and capital lease obligations, less current portion of
$4.252 billion; other long-term liabilities of $695 million; and
noncontrolling interest of $1.076 billion; resulting in
stockholders' equity of $648 million.
* * *
As reported by the Troubled Company Reporter on October 7, 2009,
Standard & Poor's Ratings Services affirmed Advanced Micro's
'CCC+' corporate credit rating and revised its outlook to positive
from negative.
ADVOCATE FINANCIAL: Voluntary Chapter 11 Case Summary
-----------------------------------------------------
Debtor: Advocate Financial, L.L.C.
5555 Hilton Avenue, Suite 410
Baton Rouge, LA 70808
Bankruptcy Case No.: 10-10615
Chapter 11 Petition Date: March 2, 2010
Court: United States Bankruptcy Court
Eastern District of Louisiana (New Orleans)
Judge: Elizabeth W. Magner
Debtor's Counsel: Dennis M. LaBorde, Esq.
Baldwin Haspel Burke & Mayer, LLC
1100 Poydras Street, Suite 2200
New Orleans, LA 70163-2200
Tel: (504) 569-2900
Fax: (504) 569-2099
Email: laborde@bhbmlaw.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The Debtor did not file a list of its 20 largest unsecured
creditors when it filed its petition.
AIRTRAN HOLDINGS: Board Amends Bylaws on Special Meetings
---------------------------------------------------------
The Board of Directors of AirTran Holdings, Inc., amended and
restated the Company's Bylaws effective as of February 23, 2010.
The amendments (i) revise the Company's notice requirements for
special meetings under Article Five, Section 5.4 and the quorum
requirements in Section 5.8 to facilitate action under a CEO
Emergency Succession Plan; and (ii) clarify committee quorum
requirements under Section 5.12. s well, the Bylaws contain other
stylistic changes to facilitate the readability thereof, but which
have no substantive effect.
A full-text copy of AirTran's Amended and Restated Bylaws is
available at no charge at http://ResearchArchives.com/t/s?562d
About AirTran Holdings
Headquartered in Orlando Florida, AirTran Holdings Inc. (NYSE:
AAI) -- http://www.airtran.com/-- a Fortune 1000 company, is the
parent company of AirTran Airways, which has been ranked the
number one low-cost carrier in the Airline Quality Rating study
for the past two years. AirTran is the only major airline with
Wi-Fi on every flight and offers coast-to-coast service on North
America's newest all-Boeing fleet. Its low-cost, high-quality
product also includes assigned seating, Business Class and
complimentary XM Satellite Radio on every flight.
At December 31, 2009, AirTran had $2,284,172,000 in total assets,
including cash and cash equivalents of $542,619,000; against total
current liabilities of $726,539,000, long-term capital lease
obligations of $14,806,000, long-term debt of $917,122,000, other
liabilities of $111,760,000, deferred income taxes of $4,206,000,
and derivative financial instruments of $7,796,000; resulting in
stockholders' equity of $501,943,000.
* * *
As reported by the Troubled Company Reporter on December 28, 2009,
Moody's Investors Service raised its ratings of AirTran Holdings'
corporate family and probability of default ratings each to Caa1
from Caa2. Moody's also affirmed the Caa3 rating on the
Convertible Senior Unsecured Notes due 2023, the SGL-3 Speculative
Grade Liquidity rating and the B1, Caa1 and Caa2 ratings on each
of the Class A, Class B, and Class C tranches, respectively of
AirTran's 1999-1 Enhanced Equipment Trust Certificates. Moody's
changed the outlook to positive.
The Caa1 Corporate Family rating considers the still high leverage
and AirTran's exposure to cyclical risks in the airline industry.
Moody's anticipates that AirTran could generate positive free cash
flow in 2010 because of improving cash flow from operations and
lower aircraft capital expenditures relative to 2009. However,
scheduled payments for aircraft materially increase in 2011 to
$270 million, which could temper continued improvements in credit
metrics if operating cash flows do not increase commensurately
with this step-up in capital investment.
The TCR said on July 10, 2009, Standard & Poor's Ratings Services
affirmed the airline's corporate credit rating at CCC+/Stable/--.
AMERICAN AXLE: Barrow Hanley Reports 6.84% Equity Stake
-------------------------------------------------------
Barrow, Hanley, Mewhinney & Strauss, LLC, disclosed that as of
December 31, 2009, it may be deemed to beneficially own 4,756,190
shares or roughly 6.84% of the common stock of American Axle &
Manufacturing Holdings Inc.
Headquartered in Detroit, Michigan, American Axle & Manufacturing
Holdings Inc. (NYSE: AXL) -- http://www.aam.com/-- is a Tier I
supplier to the automotive industry. American Axle manufactures,
engineers, designs and validates driveline and drivetrain systems
and related components and chassis modules for light trucks, sport
utility vehicles, passenger cars, crossover vehicles and
commercial vehicles. American Axle is the principal supplier of
driveline components to General Motors for its rear-wheel drive
light trucks and SUVs manufactured in North America, supplying
substantially all of GM's rear axle and front four-wheel drive and
all-wheel drive (4WD/AWD) axle requirements for these vehicle
platforms. Sales to GM were roughly 78% of AAM's total net sales
in 2009, 74% in 2008 and 78% in 2007. In addition to locations in
the United States (Michigan, New York, Ohio and Indiana), AAM also
has offices or facilities in Brazil, China, Germany, India, Japan,
Luxembourg, Mexico, Poland, South Korea, Thailand and the United
Kingdom.
At December 31, 2009, the Company had total assets of
$1.986 billion against total liabilities of $2.546 billion,
resulting in stockholders' deficit of $559.9 million.
* * *
American Axle carries Standard & Poor's "B-" Corporate Family
Rating; Moody's Investors Services' "Caa2" Corporate Family
Rating; and Fitch Ratings' "B-" Corporate Family Rating.
AMERICAN AXLE: Dimensional Fund Holds 2.54% of Common Stock
-----------------------------------------------------------
Dimensional Fund Advisors LP disclosed that as of December 31,
2009, it may be deemed to beneficially own 1,766,592 shares or
roughly 2.54% of the common stock of American Axle & Manufacturing
Holdings Inc.
Headquartered in Detroit, Michigan, American Axle & Manufacturing
Holdings Inc. (NYSE: AXL) -- http://www.aam.com/-- is a Tier I
supplier to the automotive industry. American Axle manufactures,
engineers, designs and validates driveline and drivetrain systems
and related components and chassis modules for light trucks, sport
utility vehicles, passenger cars, crossover vehicles and
commercial vehicles. American Axle is the principal supplier of
driveline components to General Motors for its rear-wheel drive
light trucks and SUVs manufactured in North America, supplying
substantially all of GM's rear axle and front four-wheel drive and
all-wheel drive (4WD/AWD) axle requirements for these vehicle
platforms. Sales to GM were roughly 78% of AAM's total net sales
in 2009, 74% in 2008 and 78% in 2007. In addition to locations in
the United States (Michigan, New York, Ohio and Indiana), AAM also
has offices or facilities in Brazil, China, Germany, India, Japan,
Luxembourg, Mexico, Poland, South Korea, Thailand and the United
Kingdom.
At December 31, 2009, the Company had total assets of
$1.986 billion against total liabilities of $2.546 billion,
resulting in stockholders' deficit of $559.9 million.
* * *
American Axle carries Standard & Poor's "B-" Corporate Family
Rating; Moody's Investors Services' "Caa2" Corporate Family
Rating; and Fitch Ratings' "B-" Corporate Family Rating.
AMERICAN AXLE: Eagle Asset Management Reports 5.63% Stake
---------------------------------------------------------
Eagle Asset Management, Inc., disclosed that as of December 31,
2009, it may be deemed to beneficially own 3,127,041 shares or
roughly 5.63% of the common stock of American Axle & Manufacturing
Holdings Inc.
Headquartered in Detroit, Michigan, American Axle & Manufacturing
Holdings Inc. (NYSE: AXL) -- http://www.aam.com/-- is a Tier I
supplier to the automotive industry. American Axle manufactures,
engineers, designs and validates driveline and drivetrain systems
and related components and chassis modules for light trucks, sport
utility vehicles, passenger cars, crossover vehicles and
commercial vehicles. American Axle is the principal supplier of
driveline components to General Motors for its rear-wheel drive
light trucks and SUVs manufactured in North America, supplying
substantially all of GM's rear axle and front four-wheel drive and
all-wheel drive (4WD/AWD) axle requirements for these vehicle
platforms. Sales to GM were roughly 78% of AAM's total net sales
in 2009, 74% in 2008 and 78% in 2007. In addition to locations in
the United States (Michigan, New York, Ohio and Indiana), AAM also
has offices or facilities in Brazil, China, Germany, India, Japan,
Luxembourg, Mexico, Poland, South Korea, Thailand and the United
Kingdom.
At December 31, 2009, the Company had total assets of $1.986
billion against total liabilities of $2.546 billion, resulting in
stockholders' deficit of $559.9 million.
* * *
American Axle carries Standard & Poor's "B-" Corporate Family
Rating; Moody's Investors Services' "Caa2" Corporate Family
Rating; and Fitch Ratings' "B-" Corporate Family Rating.
AMERICAN CAPITAL: Lowers Net Loss to $910 Million in 2009
---------------------------------------------------------
Publicly traded private equity firm and global asset manager
American Capital, Ltd., filed its annual report on Form 10-K,
showing a net loss of $910 million on $697 million of operating
income for 2009, compared with a net loss of $3.11 billion on
$1.05 billion of operating income for 2008.
The Company's balance sheet as of Dec. 31, 2009, showed
$6.67 billion in assets, $4.34 billion of debts, and $2.33 billion
in stockholders' equity.
Ernst & Young Llp, in McLean Virginia, expressed substantial doubt
about the Company's ability to continue as a going concern. The
independent auditors reported that the Company has incurred net
losses of $910 milion and $3.11 billion for the years ended
December 31, 2009 and December 31, 2008, respectively. In
addition, the Company has received default notices from certain
lenders and noteholders for its non-compliance with certain
covenants of its unsecured borrowing arrangements, and the Company
is generally restricted from issuing any new debt because it has
not met the 200% minimum asset coverage requirement under the
Investment Company Act of 1940.
A full-text copy of the annual report is available for free at:
http://researcharchives.com/t/s?5601
About the Company
Based in Bethesda, Maryland, American Capital, Ltd. is a publicly
traded private equity firm and global asset manager.
AMERICAN INT'L: Ex-Gen. Counsel Anastasia Kelly Joins DLA Piper
---------------------------------------------------------------
Anastasia Kelly has joined DLA Piper's Washington, DC office as Of
Counsel. Ms. Kelly most recently served as Vice Chairman at
American International Group, in charge of Legal, Compliance,
Regulatory, Human Resources, Communications, Government Relations
and Public Relations. She began at AIG in 2006 as Executive Vice
President, General Counsel and Senior Regulatory and Compliance
Officer.
While at AIG, Ms. Kelly worked to strengthen the compliance,
regulatory and governance framework of the company and to build a
cohesive team across the corporate functions she supervised.
Under her leadership, AIG's corporate activities became better
positioned to restore the embattled company's financial health.
"We have known and worked closely with Stasia for many years, in a
variety of different contexts. It would be difficult to identify
another lawyer in this country with more complex corporate
governance and board crisis experience, or more character, grit
and determination than Stasia Kelly," said Francis B. Burch, Jr.,
Global Chairman of DLA Piper. "She has a well earned reputation
as the go-to counsel for companies in difficult circumstances and
she will be a tremendous asset for our clients as they navigate
this volatile market and these challenging times."
Ms. Kelly joined AIG as Executive Vice President, General Counsel
and Senior Regulatory and Compliance Officer in 2006, after the
departure of Chairman and CEO Hank Greenberg amid a probe by then
New York State Attorney General Eliot Spitzer. She was brought to
AIG to assist in building a new corporate culture. Following the
financial crisis in 2008, in which AIG received significant
amounts of taxpayer assistance, she was named Vice Chairman in
January 2009.
"Stasia brings a wealth of legal and management experience. She
has dealt with enormous corporate governance challenges during her
career, and her perspective is incredibly valuable in the current
economic environment," said Roger Meltzer, Global Chair of DLA
Piper's Corporate and Finance practice. "Our global platform is
the ideal setting for Stasia to leverage her extensive experience
and return to private legal practice."
Prior to joining AIG, Ms. Kelly served as Executive Vice President
and General Counsel of MCI/WorldCom, where, as a member of the
restructuring team, she helped the company recover from an
accounting scandal, emerge from bankruptcy and position itself for
acquisition by Verizon Communications. Previously, she was Senior
Vice President and General Counsel of Sears, Roebuck and Co.,
managing corporate legal policy and strategy. Ms. Kelly also
served as Senior Vice President, General Counsel and Corporate
Secretary at Fannie Mae from 1995-1998, and had been a partner and
associate at Wilmer, Cutler & Pickering, where she had extensive
exposure to regulatory and compliance issues involving financial
institutions and securities firms. She has served on the boards of
numerous non-profit organizations, with a particular emphasis on
providing legal services to disenfranchised and indigent
populations.
Ms. Kelly received a J.D., magna cum laude, from George Washington
University National Law Center and a B.A., cum laude, from Trinity
University.
The Wall Street Journal's Serena Ng says Ms. Kelly joins DLA Piper
about two months after she resigned over government-imposed pay
curbs and secured more than $3 million in severance. As reported
by the Troubled Company Reporter, U.S. pay czar, Kenneth Feinberg,
in December 2009 capped annual cash salaries for most executives
at $500,000, and Ms. Kelly's pay stood to be reduced
significantly.
About DLA Piper
DLA Piper -- http://www.dlapiper.com/-- has 3,500 lawyers in 29
countries and 67 offices throughout the US, UK, Continental
Europe, Middle East and Asia.
About AIG
Based in New York, American International Group, Inc., is an
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 provide 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 from the U.S. government, and continues to
seek buyers of its assets.
AMERICAN INT'L: Reports $8.9-Bil. Net Loss for Fourth Quarter
-------------------------------------------------------------
American International Group Inc. reported a net loss attributable
to AIG common shareholders of $8.9 billion for the fourth quarter
of 2009, compared with a net loss of $61.7 billion in the fourth
quarter of 2008. Fourth quarter 2009 adjusted net loss was
$7.2 billion, compared to an adjusted net loss of $38.5 billion in
the fourth quarter of 2008.
The net loss in the quarter can be primarily attributed to these
items:
* The $6.2 billion of interest and amortization expense,
including $5.2 billion of accelerated amortization expense on
the prepaid commitment asset resulting from the $25 billion
reduction in the balance outstanding and the maximum credit
available under the Federal Reserve Bank of New York Credit
Facility;
* A $2.8 billion loss recognized on the pending sale of Nan
Shan Life Insurance Company, Limited;
* Loss reserve strengthening of $2.3 billion in Commercial
Insurance; and
* A valuation allowance charge of $2.7 billion for tax benefits
not presently recognizable.
During the quarter, certain of AIG's businesses continued to
stabilize and the results reflect continued improvement in the
global financial markets.
The Company also reported $847.58 billion in total assets and
$748.55 billion in total liabilities resulting to a $98.07 billion
stockholders' equity as of Dec. 31, 2009.
Commenting on the fourth quarter and full year 2009 results, AIG
President and Chief Executive Officer Robert H. Benmosche said,
"Our team made great progress during the year in executing our
strategic restructuring plan, by stabilizing and strengthening
AIG's insurance businesses, reducing AIG Financial Products Corp.
exposures, and positioning certain businesses for sale. I am
delighted that several seasoned, well-respected, financial
services executives, including Peter Hancock, Tom Russo, Michael
Cowan and Sandra Kapell, have joined the AIG team and enhanced our
prospects for rebuilding this great company.
"In the fourth quarter, we took significant strides toward the
dispositions of American International Assurance Company, Ltd. and
American Life Insurance Company; and through the creation of two
special purpose vehicles that now own these two companies, we
reduced our debt to the FRBNY Credit Facility by $25 billion in
exchange for FRBNY ownership of preferred interests in the SPVs.
"As a result of reducing our debt to the FRBNY, during the fourth
quarter we incurred certain losses associated with this debt
reduction. Back in September of 2008, in exchange for $85 billion
in support, AIG turned over a 79.9% ownership stake in the company
to a trust established for the sole benefit of the U.S. Treasury.
This ownership stake in effect represented a 'pre-paid commitment'
fee that AIG valued at $23 billion as an asset on its balance
sheet, which we are amortizing over the life of the FRBNY Credit
Facility, accelerated for mandatory prepayments. In the fourth
quarter of 2009, we accelerated the amortization of $5.2 billion
pre-tax of this asset in connection with reducing the amount we
could borrow from the FRBNY by $25 billion. This is the second
time we have reduced the amount we could borrow. Last year, we
reduced the original $85 billion commitment to $60 billion when
the terms of the FRBNY Credit Facility were amended and recorded a
similar accelerated amortization amount of $6.6 billion.
"Importantly, in the fourth quarter, AIG strengthened its General
Insurance worldwide loss reserves by $2.3 billion, or $1.5 billion
after tax, based on AIG's year end internal actuarial analyses.
AIG considered the results of its third party actuary's analysis
in reaching its judgment. This reserve strengthening represents
roughly 3.6 percent of Chartis' carried reserves at December 31,
2009.
"At our Domestic Life Insurance & Retirement Services companies,
recently rebranded as the SunAmerica Financial Group, we have made
notable progress in re-establishing relationships and
reinvigorating sales distributions. We are very proud that
Western National, one of the first insurance companies to develop
fixed annuity products specifically for sale through banks,
successfully regained its number one position in that market in
the third quarter of 2009.
"We continue to address the funding needs and are exploring
strategic restructuring opportunities for International Lease
Finance Corporation, and American General Finance, In.
"Lastly, we are increasingly confident in how we see the mix of
AIG's businesses over the long term. We are taking the right
steps to regain our stature as one of the most respected and
diverse property-casualty operations in the world, with a strong
U.S. life and annuity operation and several other businesses that
will enhance our nucleus, help us to meet our goal of repaying
taxpayers and provide value to the communities where we operate,"
Mr. Benmosche concluded.
At December 31, 2009, total equity was $98.1 billion, a
$21.6 billion increase from $76.5 billion at September 30, 2009.
The increase includes $24.5 billion noncontrolling nonvoting
callable junior and senior preferred interests in the AIA and
ALICO SPVs held by the FRBNY, $3.4 billion of unrealized
appreciation of investments, and $2.1 billion from a drawdown from
the Department of the Treasury Commitment related to the Series F
Fixed Rate Non-Cumulative Perpetual Preferred Stock, partially
offset by $8.9 billion of net loss attributable to AIG.
A full-text copy of the press release on the Company's fourth
quarter results is available for free at
http://ResearchArchives.com/t/s?555f
A full-text copy of the Company's annual report on Form 10-K is
available for free at http://ResearchArchives.com/t/s?555c
About AIG
Based in New York, American International Group, Inc., is an
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 provide 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 from the U.S. government, and continues to
seek buyers of its assets.
* * *
According to the Troubled Company Reporter on March 2, 2010,
Moody's Investors Service has affirmed the ratings of American
International Group, Inc. (long-term issuer rating of A3, short-
term issuer rating of Prime-1) following the company's
announcement of results for the fourth quarter and full year of
2009. Also affirmed were the Aa3 insurance financial strength
ratings of Chartis U.S. and the A1 IFSRs of SunAmerica Financial
Group.
AMKOR TECHNOLOGY: S&P Affirms 'B+' Corporate Credit Rating
----------------------------------------------------------
Standard & Poor's Ratings Services said it affirmed its 'B+'
corporate credit rating and other ratings on Chandler, Ariz.-based
outsourced packaging and testing service provider Amkor Technology
Inc. S&P also revised the outlook to positive from negative.
Total lease-adjusted debt was $1.4 billion at Dec. 31, 2009.
"The action reflects Amkor's rapidly improving profitability, in
line with broad industry cycles, low leverage for the rating, and
expectations that its moderate financial policies will continue,"
said Standard & Poor's credit analyst Bruce Hyman.
The positive outlook reflects S&P's expectations that S&P could
raise Amkor's ratings over the intermediate term if operating
performance and leverage metrics remain near recent levels.
ARTHUR GROOM: Gets OK to Hire Shapiro & Croland as Bankr. Counsel
-----------------------------------------------------------------
Arthur Groom & Company, Inc., sought and obtained permission from
the Hon. Morris Stern of the U.S. Bankruptcy Court for the
District of New Jersey to employ Shapiro & Croland as bankruptcy
counsel.
S&C will, among other things:
a. prepare and pursue confirmation of a plan of
reorganization or liquidation and approval of a disclosure
statement;
b. prepare on behalf of the Debtor necessary applications,
motions, answers, orders, reports, and other legal papers;
c. appear in Court to protect the interests of the Debtor;
and
d. represent the Debtor in any adversary proceedings.
John P. Di Iorio, a member at S&C, said that the firm will be paid
based on the hourly rates of its personnel:
Paralegals $115-$120
Manuel Arroyo $175
Jarrid Kantor $225
Alexander Benisatto $275
David O. Marcus $350
John P. Di Iorio $420
Robert P. Shapiro $525
Mr. Iorio assured the Court that S&C is "disinterested" as that
term is defined in Section 101(14) of the Bankruptcy Code.
Arthur Groom & Company, Inc., operates a retail jewelry store in
Ridgewood, New Jersey. The Company filed for Chapter 11
bankruptcy protection on February 3, 2010 (Bankr. D. N.J. Case No.
10-13221). The Company listed $1,000,001 to $10,000,000 in assets
and $10,000,001 to $50,000,000 in liabilities.
ASBURY AUTOMOTIVE: Earns $13.4 Million in 2009
----------------------------------------------
Asbury Automotive Group, Inc., filed its annual report on
Form 10-K, showing net income of $13.4 million, or $0.41 per
diluted share, on $3.7 billion of revenue for 2009, compared with
a net loss of $343.7 million, or $10.84 per diluted share, on
$4.4 billion of revenue for 2008.
Income from continuing operations was $24.2 million, or $0.74 per
diluted share, compared with a loss of $323.4 million, or $10.20
per diluted share, in the corresponding period last year.
The Company's balance sheet as of Dec. 31, 2009, showed
$1.4 billion in assets, $1.2 billion of debts, and $243.6 million
of stockholders' equity.
A full-text copy of the annual report is available for free at:
http://researcharchives.com/t/s?5676
About the Company
Headquartered in Duluth, Georgia, Asbury Automotive Group, Inc.
(NYSE: ABG) --is one of the largest automobile retailers in the
U.S. Asbury currently operates 81 retail auto stores,
encompassing 108 franchises for the sale and servicing of 38
different brands of American, European and Asian automobiles.
* * *
As reported in the Troubled Company Reporter on June 5, 2009,
Moody's Investors Service said that the June 1, 2009 bankruptcy
filing by General Motors has no immediate impact on the ratings
and outlook for the auto retailers rated by Moody's.
The last rating action for Asbury Automotive Group, Inc. was the
March 25, 2009 downgrade of the Corporate Family and Probability
of Default ratings to B2 from B1 and the assignment of a negative
outlook.
ATLANTIC COAST: Case Summary & 2 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Atlantic Coast Paladin Shores, LLC
730 Commerce Ctr Dr #C
Sebastian, FL 32958
Bankruptcy Case No.: 10-15275
Chapter 11 Petition Date: March 2, 2010
Court: United States Bankruptcy Court
Southern District of Florida (West Palm Beach)
Judge: Paul G. Hyman, Jr.
Debtor's Counsel: Martin Werner, Esq.
102 NE 2nd St #166
Boca Raton, FL 33432
Tel: (305) 764-9283
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $1,000,001 to $10,000,000
According to the schedules, the Company has assets of $13,503,039,
and total debts of $3,063,543.
The petition was signed by Joseph Paladin, the company's managing
member.
Debtor's List of 2 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Rick Bertel Consulting Fees $100,000
Fred Kretschmer Attorney Fees $20,000
BANK OF NT: Fitch Downgrades Individual Rating to 'F' From 'C'
--------------------------------------------------------------
This is an amendment of a release issued earlier. It includes the
affirmation of BNTB's preferred stock at 'AA+' which was omitted
from the original release.
Fitch Ratings affirms Bank of N.T. Butterfield & Son Limited's
long-term Issuer Default Rating at 'A-' and short-term IDR at
'F1'. The Rating Outlook is Stable. Concurrently, Fitch has
downgraded the Individual Rating to 'F' from 'C'. Fitch has also
affirmed BNTB's long- and short-term deposits, subordinated debt
and preferred stock ratings. These ratings are linked to BNTB's
IDRs. A detailed ratings list follows at the end of this release.
BNTB's ratings and Stable Outlook reflects that its long-term IDR
is set at its Support Floor of 'A-', based on its systemic
importance to the banking sector in Bermuda and the local
government's demonstrated support to preserve the financial
stability of its largest local institution. BNTB is the largest
domestic institution with 40% of market share and is the third
largest employer in Bermuda. Furthermore, the Bermudian
government demonstrated financial support for BNTB through actions
taken in March 2009 which guaranteed the principal and dividend
payments of the bank's $200 million preferred stock issuance.
Bermuda's sovereign foreign currency IDR ratings are 'AA+'. As
such, BNTB's long-term IDR is a function of Bermuda's sovereign
foreign currency rating.
Fitch's downgrade of BNTB's Individual Rating to 'F' follows the
company's announcement of a significant recapitalization led by
private equity firm Carlyle Group and CIBC totaling $300 million
($150 million each) and $250 million from backstop investors. The
Individual downgrade reflects Fitch's view that the bank's level
of embedded losses in the securities portfolio necessitated the
capital raise. Additionally, BNTB's operating challenges were
isolated and not reflective of Bermuda's banking sector
conditions. The recapitalization is a result of securities losses
in its HTM portfolio, which resulted in a $132.1 million charge
related to other than-temporary impairment of investments (OTTI).
BNTB has a sizeable U.S. mortgage backed securities in the held to
maturity investment portfolio, which has been reclassified as
available-for-sale. Fitch also notes that BNTB has also made a
number of executive management changes, including the appointment
of Bradford Kopp to President, Chief Executive Officer and
Director, succeeding Alan Thompson, who has stepped down.
Bradford Kopp had been serving as President and Chief Financial
Officer. BNTB intends to appoint a new CFO in the near term.
Further, the Carlyle Group and CIBC will each get two board seats
on a Board of 12 directors.
Fitch expects to upgrade the Individual Rating within the next
thirty-days and anticipates an Individual Rating outcome of D/E.
Although Fitch views the capital raise as a positive, the impact
to the tangible common equity ratio is modest. Following the
completion, pro forma TCE would be about 4.5%. Given the economic
downturn and potential for an increase in NPLs and NCOs, Fitch
believes the pro forma equity capital provides only a modest
cushion should BNTB experience any credit deterioration in its
core loan portfolio. Fitch recognizes the bank's effort to reduce
the risk on the balance sheet and anticipates that BNTB will
successfully sell a significant portion its structured products at
a loss of about $150 million to $175 million, which will impact
2010 first quarter results. Given the completion of the capital
raise, regulatory capital ratios are expected to remain above
minimum regulatory requirements including the projected losses.
Additionally, CIBC has also committed to providing a line of
credit to BNTB for up to $500 million, which further strengthens
BNTB's liquidity position and provides financial flexibility.
Fitch has affirmed these ratings with Stable Outlook:
Bank of N.T. Butterfield & Son
-- Long-term IDR at 'A-';
-- Short-term IDR at 'F1';
-- Preferred Stock at 'AA+';
-- Subordinated debt at 'BBB+';
-- Support rating at '1';
-- Support Floor at 'A-'.
Fitch has downgraded this:
-- Individual rating downgraded to 'F' from 'C'.
BILL HEARD: No Equitable Subrogation for BMW & Columbus Bank
------------------------------------------------------------
WestLaw reports that under Alabama law, a creditor that had
provided floor plan financing to certain Chapter 11 debtor-
automobile dealerships, which sought to be equitably subrogated to
the collateral position of a second creditor, did not pay a third
party debt, as required to establish the first element of
equitable subrogation, when it agreed to divide the proceeds of
certain contested collateral pursuant to a settlement agreement
with the second creditor. Neither the contested collateral nor
that amount retained by the second creditor in the parties'
settlement was the undisputed property of the first creditor, the
Alabama bankruptcy court found. The second creditor, instead, had
challenged the extent and priority of the first creditor's
security interest in the contested collateral. The settlement
thus did not involve an advancement of the first creditor's
property to pay the debt of the specified debtors. In re Bill
Heard Enterprises, Inc., --- B.R. ----, 2010 WL 423109 (Bankr.
N.D. Ala.) (Caddell, J.).
The Honorable Jack Caddell rendered this decision in the context
of a lawsuit (Bankr. N.D. Ala. Adv. Pro. No. 09-80117) BMW
Financial Services, NA, LLC, d/b/a Alphera Financial Services, and
Columbus Bank & Trust Company, as an intervening plaintiff,
brought against the Debtors to recover about $1.2 million. GMAC
LLC, owed $165 million under pre-petition and debtor-in-possession
financing agreements, is the "first creditor" referred to in
WestLaw's summary.
About Bill Heard Enterprises
Headquartered in Huntsville, Alabama, Bill Heard Enterprises Inc.
-- http://www.billheardhuntsville.com/-- was one of the largest
Chevrolet dealers in the United States. The company and 17 of
its affiliates filed for Chapter 11 protection (Bankr. N.D. Ala.
Case No. 08-83028) on Sept. 28, 2008. Derek F. Meek, Esq.,
at Burr & Forman, LLP, represents the Debtors in their
restructuring efforts. An official committee of unsecured
creditors has been appointed in the bankruptcy cases. Kilpatrick
Stockton LLP represents the Committee. When the Debtors filed for
protection from their creditors, they estimated their assets and
debts at more than $500 million.
BLACK GAMING: Case Summary & 4 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Black Gaming, LLC
950 West Mesquite Blvd.
MesquitE, NV 89027
Bankruptcy Case No.: 10-13301
About the Business: Headquartered in Las Vegas, Nev., Black
Gaming, LLC is a holding company and is an
owner and operator of three gaming
entertainment properties located in Mesquite,
Nev. As of June 30, 2009, the Company had
total assets of $148,280,000 and total
liabilities of $233,532,000.
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
District of Nevada (Las Vegas)
Judge: Bruce A. Markell
Debtor's Counsel: Gregory E. Garman, Esq.
Gordon & Silver, Ltd.
3960 Howard Hughes Pky, 9th Flr
Las Vegas, NV 89169
Tel: (702) 796-5555
Email: bankruptcynotices@gordonsilver.com
Talitha B. Gray, Esq.
Gordon & Silver, Ltd.
3960 Howard Hughes Pkwy., 9th Floor
Las Vegas, NV 89169
Tel: (702) 796-5555
Email: athalrose@gordonsilver.com
Debtor's Claims
& Notice Agent: Kurtzman Carson Consultants
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $100,000,001 to $500,000,000
The petition was signed by Sean P. McKay, the company's CFO.
Debtor-affiliates that filed separate Chapter 11 petitions
March 1, 2010:
(1) B&BB, Inc.
dba Virgin River Hotel & Casino & Bingo
Case No: 10-13305
Estimated Assets: $10,000,000 to $50,000,000
Estimated Debts: $100,000,000 to $500,000,000
(2) R. Black, Inc.
Case No: 10-13306
Estimated Assets: $0 to $50,000
Estimated Debts: $100,000,000 to $500,000,000
(3) Casablanca Resorts, LLC
aka Oasis Hotel, Casino, Spa And Golf
Case No: 10-13309
Estimated Assets: $10,000,000 to $50,000,000
Estimated Debts: $100,000,000 to $500,000,000
(4) Oasis Interval Ownership, LLC
Case No: 10-13310
Estimated Assets: $50,000 to $100,000
Estimated Debts: $100,000,000 to $500,000,000
(5) Oasis Interval Management, LLC
Case No: 10-_____
(6) Oasis Recreational Properties, Inc.
Case No: 10-_____
(7) RBG, LLC
Case No: 10-_____
(8) Virgin River Casino Corporation
Case No: 10-_____
A. Black Gaming, LLC's List of 4 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
The Bank of New York 12.750% Senior $75,406,356
Mellon Trust Co. Subordinated Notes,
c/o David Kerr, VP obligation incurred
101 Barclay, 8 West December 2004
New York, NY 10286
Veracity Communications $5,600
Verizon Wireless $2,500
Attn: Collections/
Bankruptcy Dept.
Corporate Business $4
Communications
Attention: Managing Member
B. B&BB, Inc.'s List of 16 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
The Bank of New York 12.750% Senior $75,406,356
Mellon Trust Co. Subordinated Notes,
c/o David Kerr, VP obligation incurred
101 Barclay Street, 8 West December 2004
New York, NY 10286
Nevada Gaming Commission Accrued gaming taxes. $182,933
and Control Board As stated in Debtor's
Emergency Motion
Authorizing Payment of
Pre-petition Taxes,
Debtors contend that
Certain of the foregoing
Overton Power District 5 $99,521
Attn: Managing Member
Nevada Department of Accrued sales/use/tax. $55,276
Taxation As stated in Debtor's
Bankruptcy Section Emergency Motion
Authorizing Payment of
Pre-petition Taxes,
Debtors contend that
Certain of the foregoing
Nevada Department of Accrued room taxes. $50,959
Taxation As stated in Debtor's
Bankruptcy Section Emergency Motion
Authorizing Payment of
Pre-petition Taxes,
Debtors contend that
Certain of the foregoing
I G T $33,480
Attention: Managing Member
Aristocrat Technologies $26,600
Inc.
Attention: Managing Member
WMS Gaming $15,800
Attention: Managing Member
Konami Gaming $12,500
Attention: Managing Member
Bally $10,600
Attention: Managing Member
NV Megajackpots $10,000
Attention: Managing Member
Virgin Valley Water District $9,500
Attention: Managing Member
Virgin Valley Disposal $8,500
Attention: Managing Member
Atronic Americas $8,200
The Daily Spectrum $7,500
Attention: Managing Member
Comcast Advertising Sales $6,375
Attention: Managing Member
C. R. Black, Inc.'s List of 1 Largest Unsecured Creditor:
Entity Nature of Claim Claim Amount
------ --------------- ------------
The Bank of New York 12.750% Senior $75,406,356
Mellon Trust Co. Subordinated Notes,
c/o David Kerr, VP obligation incurred
101 Barclay Street, 8 West December 2004
New York, NY 10286
D. Casablanca Resorts, LLC's List of 15 Largest Unsecured
Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
The Bank of New York 12.750% Senior $75,406,356
Mellon Trust Co. Subordinated Notes,
c/o David Kerr, VP obligation incurred
101 Barclay Street, 8 West December 2004
New York, NY 10286
Overton Power District 5 $25,000
Nevada Department of Accrued room taxes. $15,042
Taxation As stated in Debtor's
Bankruptcy Section Emergency Motion
Authorizing Payment of
Pre-petition Taxes,
Debtors contend that
Certain of the foregoing
Virgin Valley Water District $7,000
Virgin Valley Disposal $2,300
Terminex Commercial $1,050
L&M Welding L.C. $350
Attention: Managing Member
Nevada Department of Accrued sales/use/tax. $252
Taxation As stated in Debtors'
Bankruptcy Section Emergency Motion
Authorizing Payment of
Pre-petition Taxes,
Debtors contend that
Certain of the foregoing
High Sierra Elevator $200
Attention: Managing Member
Clark County Social $60
Services
Francis Rosin Alleged personal Unknown
c/o Cap & Kudler injury
Allen Cap, Esq.
3202 W. Charleston
Boulevard
Las Vegas, NV 89104
Kamilo Ordonez Alleged negligence Unknown
c/o Jebediah P. Bingham -premise liability
840 Pinnacle Court
Suite 202
Mesquite, NV 89027
Margot Jesky Alleged negligence Unknown
c/o David Francis Law Firm -premises liability
Brett Faldez, Esq.
8831 West Sahara Avenue
Las Vegas, NV 89117
Mariann McNall Alleged negligence Unknown
c/o Flangas & Leventhal Law
Offices
Todd Leventhal, Esq.
600 South Third Street
Las Vegas, NV 89101
Robin Estes-McNell Alleged personal Unknown
c/o Gallilan, Wilcox, injury
Welker & Olsen
Britt Beckstrom, Esq.
340 Falcon Ridge Parkway
Mesquite, NV 89027
E. Oasis Interval Ownership, LLC's List of 1 Largest Unsecured
Creditor:
Entity Nature of Claim Claim Amount
------ --------------- ------------
The Bank of New York 12.750% Senior $75,406,356
Mellon Trust Co. Subordinated Notes,
c/o David Kerr, VP obligation incurred
101 Barclay Street, 8 West December 2004
New York, NY 10286
BLANCA LLC: Files Schedules of Assets & Liabilities
---------------------------------------------------
Blanca, LLC, has filed with the U.S. Bankruptcy Court for the
Central District of California its schedules of assets and
liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ------ -----------
A. Real Property $11,600,000
B. Personal Property $851,644
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $16,849,284
E. Creditors Holding
Unsecured Priority
Claims $0
F. Creditors Holding
Unsecured Non-priority
Claims $1,552,371
------------- ------------
TOTAL $12,451,644 $18,401,655
Downey, California-based Blanca, LLC, filed for Chapter 11
bankruptcy protection on February 23, 2010 (Bankr. C.D. Calif.
Case No. 10-16519). Carolyn A. Dye, Esq., who has an office in
Los Angeles, California, assists the Company in its restructuring
effort.
BLANCA LLC: Section 341(a) Meeting Scheduled for April 5
--------------------------------------------------------
The U.S. Trustee for Region 16 will convene a meeting of creditors
in Blanca LLC's Chapter 11 case on April 5, 2010, at 10:00 a.m.
The meeting will be held at 725 S Figueroa Street, Room 2610, Los
Angeles, CA 90017.
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.
Downey, California-based Blanca, LLC, filed for Chapter 11
bankruptcy protection on February 23, 2010 (Bankr. C.D. Calif.
Case No. 10-16519). Carolyn A. Dye, Esq., who has an office in
Los Angeles, California, assists the Company in its restructuring
effort. The Company disclosed assets of $12,451,644 and debts of
$18,401,655 in the schedule attached to its petition.
BLOCKBUSTER INC: Moody's Cuts Rating to 'Caa3'; Gives Neg. Outlook
------------------------------------------------------------------
Moody's Investors Service downgraded Blockbuster Inc.'s long term
ratings, including its Probability of Default Rating and its
Corporate Family Rating to Caa3 from Caa1. The outlook is
negative. The speculative grade liquidity rating remains SGL-3.
"The Caa3 Probability of Default Rating reflects the significant
increase in the likelihood of a transaction Moody's would consider
a distressed exchange and hence a default" said Maggie Taylor,
Vice President and Senior Credit Officer at Moody's. "This is
given Blockbuster's stated desire to pursue a transaction which
would strengthen its capital structure, which when given its weak
financial performance, may well result in it making an offer to
exchange some of its debt at a material discount to par," Taylor
added.
These ratings are downgraded and LGD point estimates changed:
-- Probability of Default Rating to Caa3 from Caa1;
-- Corporate Family Rating to Caa3 from Caa1;
-- Senior secured notes to B3 (LGD 2, 20%) from B1 (LGD 2, 24%).
-- Senior subordinated notes rating to Ca (LGD 5, 80%) from Caa3
(LGD 5, 83%).
The Speculative Grade Liquidity rating is affirmed at SGL-3.
The Caa3 Probability of Default Rating reflects Moody's
expectation that Blockbuster's very weak earnings and onerous debt
amortization schedule have increased the likelihood that the
company will pursue a restructuring of its capital structure in a
fashion Moody's would consider to be a distressed exchange. Given
the company's weak credit profile, Moody's would consider such an
offer as a default should it be at a price materially below par.
Moody's expect earnings and credit metrics to remain very weak
given the secular channel shift towards online and vending kiosks
which has led Blockbuster to close a large number of stores and to
further price deflation in the industry. This, combined with the
likely sale of its international businesses, indicates that the
company's scale will be smaller going forward and that it will
need to adjust its capital structure to a level that is more in
line with its lower earnings. The ratings also reflect the
ongoing challenges of all players in the video store industry to
identify ways to deal with intense competition, price deflation,
and evolving technology.
However, given Blockbuster's significant cash balances, Moody's
believes that Blockbuster will have adequate liquidity over the
next twelve months despite the lack of a committed bank facility.
Moody's note, however, that Blockbuster's cash balances will erode
over time as it continues to make sizable mandatory debt
amortization payments. Positive ratings consideration is given to
Blockbuster's well recognized brand name and industry position as
the only company that is present across all channels of the video
rental industry.
The negative outlook reflects the high probability of a capital
restructuring, the challenges Blockbuster's business model
continues to face, and Moody's expectation that its credit profile
will continue to be weak.
The last rating action on Blockbuster was on October 2, 2009 when
its Corporate Family Rating was upgraded to Caa1 from Caa2.
Blockbuster Inc. is a leading global provider of in-home movie and
game entertainment through several channels including; its store
base, website, digital download, and vending kiosks.
Blockbuster's approximately 6,500 stores are located throughout
the United States, its territories, and 19 other countries.
Annual revenues are about $4.1 billion.
BOYD GAMING: S&P Puts 'BB-' Rating on CreditWatch Negative
----------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB-' corporate
credit rating for Las Vegas-based Boyd Gaming Corp., along with
all related issue-level ratings on the company's debt, on
CreditWatch with negative implications.
Following a very weak fourth quarter of 2009, S&P estimate that
operating lease-adjusted leverage, excluding earnings from the
Borgata, is in the low-8x area.
"The CreditWatch listing reflects S&P's concern that recent
negative trends in the Louisiana market, in addition to sustained
weakness in the Las Vegas locals market, could prevent any
meaningful improvement to Boyd's credit measures over the
intermediate term," said Standard & Poor's credit analyst Ben
Bubeck. "Furthermore, absent an improvement in operating trends
by the end of 2010, Boyd would likely find it difficult to remain
in compliance with its leverage covenant in 2011, given scheduled
step-downs."
In resolving the CreditWatch listing, S&P will update its
expectations for 2010 and 2011 for each of Boyd's properties. If
a rating downgrade is the conclusion of S&P's review, it would
likely be limited to one notch.
BREWERY PARK ASSOCIATES: Voluntary Chapter 11 Case Summary
----------------------------------------------------------
Debtor: Brewery Park Associates, L.P.
2017 Sansom Street
Philadelphia, PA 19103
Bankruptcy Case No.: 10-11555
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Eastern District of Pennsylvania (Philadelphia)
Judge: Bruce I. Fox
Debtor's Counsel: Prince Altee Thomas, Esq.
Fox, Rothschild, O'Brien & Frankel
2000 Market St., 10th Fl.
Philadelphia, PA 19103-3291
Tel: (215) 299-2000
Email: Pthomas@Foxrothschild.Com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor did not file a list of its 20 largest unsecured
creditors when it filed its petition.
The petition was signed by Slavko S. Brkich.
BRIARWOOD CAPITAL: Section 341(a) Meeting Scheduled for March 23
----------------------------------------------------------------
The U.S. Trustee for Region 15 will convene a meeting of creditors
in Briarwood Capital, LLC's Chapter 11 case on March 23, 2010, at
1:30 p.m. The meeting will be held at Sixth Floor, Suite 630, 402
W. Broadway, San Diego, CA 92101-8511.
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.
Rancho Santa Fe, California-based Briarwood Capital, LLC, filed
for Chapter 11 bankruptcy protection on February 23, 2010 (Bankr.
S.D. Calif. Case No. 10-02677). Jeffry A. Davis, Esq., at Mintz
Levin Cohn Ferris Glovsky & Popeo, assists the Company in its
restructuring effort. The Company listed $100,000,001 to
$500,000,000 in assets and $10,000,001 to $50,000,000 in
liabilities.
BROADWAY BANCSHARES: Broadway Bank Might Be Closed by November
--------------------------------------------------------------
The Chicago Sun-Times reported that Alexi Giannoulias said it's
"quite likely" his family's community bank, Broadway Bank, will be
closed before November's election.
Mr. Giannoulias is a Democrat seeking the U.S. Senate seat once
held by President Barack Obama.
"It's quite likely that the bank will not be around," Chicago Sun-
Times quoted him as saying. "There's not a lot of capital out
there for somebody to find $60, $70 million. I hope I'm wrong."
Broadway Bank has signed a consent order by the Federal Deposit
Insurance Corp., which has required the bank to increase capital
to $75 million by late April.
About Broadway Bancshares
Privately held Broadway Bancshares Inc. is the holding company for
Broadway National Bank and its Eisenhower Bank division. The
former is a community-oriented financial institution with about 30
branches in San Antonio and Central Texas; the latter has seven
offices on military bases throughout the Lone Star State and
serves military personnel worldwide. The banks offer traditional
deposit products such as checking and savings accounts, IRAs, and
CDs. Both originate various personal, consumer, construction, and
commercial loans, as well as commercial and residential mortgages.
The banks also provide private banking, brokerage, trust,
investment management, and wealth advisory services.
BROADWAY BANCSHARES: Needs to Raise Capital for Bank by April
-------------------------------------------------------------
Broadway Bank, the banking unit of privately held Broadway
Bancshares Inc., on January 25, 2010, entered into a Stipulation
to the Issuance of a Consent Order agreeing to the issuance of a
Consent Order by the Federal Deposit Insurance Corp. and the
Illinois Department of Financial Professional Regulation, Division
of Banking.
Without admitting or denying the charges of unsafe or unsound
banking practices and violations of law relating to weaknesses in
capital, Broadway Bank agreed to the Consent Order, which requires
it to undertake a number of actions.
By late April, the Bank is required to increase its Tier 1
leverage capital ratio to not less than 9% and the Total Risk
Based Capital ratio to a level not less than 13%.
Prior to the addition of any individual to the board of directors
or the employment of any individual as a senior executive officer,
the Bank shall request and obtain the Division's written approval.
A copy of the Consent Order is available for free at:
http://bankrupt.com/misc/BroadwayBank012610.pdf
About Broadway Bancshares
Broadway Bancshares Inc. is the holding company for Broadway
National Bank (dba Broadway Bank) and its Eisenhower Bank
division. The former is a community-oriented financial
institution with about 30 branches in San Antonio and Central
Texas; the latter has seven offices on military bases throughout
the Lone Star State and serves military personnel worldwide. The
banks offer traditional deposit products such as checking and
savings accounts, IRAs, and CDs. Both originate various personal,
consumer, construction, and commercial loans, as well as
commercial and residential mortgages. The banks also provide
private banking, brokerage, trust, investment management, and
wealth advisory services.
BUCKHEAD COMMUNITY: Pendergast's Layng Named Chapter 7 Trustee
--------------------------------------------------------------
Buckhead Community Bancorp, Inc., disclosed that on December 31,
2009, it filed a voluntary petition for relief pursuant to
Chapter 7 of the United States Code (Bankr. N.D. Ga. Case No. 09-
94427).
The bankruptcy trustee is William J. Layng, Jr., Esq., at
Pendergast and Jones, PC, South Terraces, Suite 1000, 115
Perimeter Center Place, Atlanta, Georgia 30346. The trustee was
appointed on December 31, 2009, and will be responsible for the
wind-up of the Company's business.
As reported by the Troubled Company Reporter, on December 4, 2009,
the Georgia Department of Banking and Finance closed The Buckhead
Community Bank, the wholly owned commercial banking subsidiary of
Buckhead Community Bancorp, Inc. The Federal Deposit Insurance
Corporation was named as the receiver of the Bank.
The FDIC entered into a purchase and assumption agreement with
State Bank and Trust Company of Macon, Georgia, pursuant to which
State Bank assumed the deposits of the Bank.
State Bank purchased essentially all of the Bank's assets, which
totaled approximately $874.0 million as of November 6, 2009, and
entered into a loss-share transaction with the FDIC with respect
to approximately $692 million of the Bank's assets.
BUILDERS FIRSTSOURCES: Inks Employment Contract with Chad Chow
--------------------------------------------------------------
Builders FirstSource Inc. entered into an Employment Agreement
with M. Chad Crow, the Company's Senior Vice President and Chief
Financial Officer.
The Agreement has a one-year term, with automatic one-year
renewals commencing on the first anniversary of the effective date
of the Agreement, unless either party provides at least 90 days
notice of non-renewal. For 2010, the minimum base salary of Mr.
Crow is $350,000. The Agreement provides for the payment of an
annual cash incentive bonus with a minimum target of 100% of his
salary.
The Agreement also provides that Mr. Crow is entitled to fully
participate in all:
* health and dental benefits and insurance programs;
* life and short- and long-term disability benefits and
insurance programs; and
* defined contribution and equity compensation programs, all as
available to senior executive officers of the Company
generally.
During Mr. Crow's employment with the Company and for one year
thereafter, he may not disclose confidential information and may
not directly or indirectly compete with the Company. In addition,
Mr. Crow may not solicit or hire any employees of the Company or
any of its subsidiaries during his employment with us and for two
years thereafter.
If Mr. Crow's employment is terminated without "cause" or in
certain events of constructive termination or non-renewal of the
Agreement, Mr. Crow will be entitled to continuation of his base
salary and health benefits for one year after the date of
termination plus payment of an amount equal to his "average bonus
compensation."
A full-text copy of the Employment Agreement is available for free
at http://ResearchArchives.com/t/s?5603
About Builders FirstSource
Headquartered in Dallas, Texas, Builders FirstSource Inc. --
http://www.bldr.com/-- is a supplier and manufacturer of
structural and related building products for residential new
construction. The company operates in 9 states, principally in
the southern and eastern United States, and has 55 distribution
centers and 51 manufacturing facilities, many of which are located
on the same premises as its distribution facilities.
* * *
According to the Troubled Company Reporter on Jan. 28, 2010,
Standard & Poor's Ratings Services raised its corporate credit
rating on Dallas-based Builders FirstSource Inc., a manufacturer
and supplier of building products for new residential
construction, to 'CCC+' from 'SD'. The outlook is positive.
CABLEVISION SYSTEMS: RNS Has $583MM Members' Deficit at Dec. 31
---------------------------------------------------------------
Rainbow National Services LLC, an indirect wholly owned subsidiary
of Cablevision Systems Corporation and CSC Holdings, LLC, on
February 26, 2010, delivered to its bondholders copies of:
-- its Consolidated Financial Statements as of December 31,
2009 and December 31, 2008 and for the years ended
December 31, 2009, 2008, and 2007
See http://ResearchArchives.com/t/s?562f
-- Management's Discussion and Analysis of Financial
Condition and Results of Operations,
See http://ResearchArchives.com/t/s?562e
The move was made in accordance with the requirements of the
Indenture, dated as of August 20, 2004, relating to RNS' and RNS
Co-Issuer Corporation's $300,000,000 8-3/4% Senior Notes due 2012
and the Indenture, dated as of August 20, 2004, relating to RNS'
and RNS Co-Issuer Corporation's $325,000,000 10-3/8% Senior
Subordinated Notes due 2014.
RNS posted net income of $136,988,000 for the year ended
December 31, 2009, from net income of $105,405,000 for 2008 and
$64,840,000 for 2007. Net revenues were $815,413,000 for 2009
from $741,482,000 for 2008 and $668,771,000 for 2007.
At December 31, 2009, RNS had $1,265,380,000 in total assets
against total liabilities of $1,848,649,000, resulting in member's
deficiency of $583,269,000.
As reported by the Troubled Company Reporter on March 3, 2010,
Cablevision Systems reported net earnings of $285.3 million on
revenue of $7.77 billion for the year ended December 31, 2009,
compared with a net loss of $236.17 million on revenue of
$7.23 billion for 2008. Cablevision reported $9.32 billion in
total assets and $14.47 billion in total liabilities, resulting to
a $5.16 billion stockholders' deficit as of December 31, 2009.
About Cablevision Systems
Headquartered in Bethpage, New York, Cablevision Systems Corp. is
predominantly a domestic cable TV multiple system operator serving
approximately 3.1 million subscribers in and around the New York
metropolitan area. Among other entertainment-and media-related
business ventures, the company also owns and distributes
programming to cable television and direct broadcast satellite
providers throughout the United States through its Rainbow
National Services subsidiary.
* * *
Cablevision carries Standard & Poor's 'BB' corporate credit rating
and Moody's "Ba2" Corporate Family and Probability of Default
Ratings.
CAMERON-811 RUSK: Case Summary & 11 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Cameron-811 Rusk, L.P.
c/o Adrian S. Baer
Cordray Wagner Schneller
3306 Sul Ross
Houston, TX 77098
Bankruptcy Case No.: 10-31856
Chapter 11 Petition Date: March 2, 2010
Court: United States Bankruptcy Court
Southern District of Texas (Houston)
Judge: Letitia Z. Paul
Debtor's Counsel: Adrian Stanley Baer, Esq.
Cordray Tomlin PC
3606 Sul Ross
Houston, TX 77098
Tel: (713) 630-0600
Fax: (713) 630-0017
Email: abaer@clegal.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The petition was signed by Dougal A. Cameron IV.
Debtor's List of 11 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Reliant Energy Retail Trade Debt $90,000
Services LLC (estimated)
1000 Main Street
Houston, TX 77002-6336
Gale, Jeffrey S. Tenant security $2,685
dba Brown Bag Deli deposit
3022 Midlane
Houston, TX 77027
Centerpoint Energy Trade Debt $4,500
PO Box 2628 (estimated)
Houston, TX 77252
Clear Wireless LLC Tenant security $1,350
deposit
Fink, Michael Tenant security $638
dba Michael's Fine deposit
Jewelry
Kim, Danny Hyunchul Tenant security $500
dba Kokoro deposit
Tannous, Victoria and Tenant security $500
Fayez deposit
Vaughn, Bryan Tenant security $400
deposit
Amerione Management LLC Tenant security $400
Attention: Minh Truong deposit
City of Houston-Water Trade Debt $160
Department (estimated)
West, Kelvin Tenant security $400
dba Kelvin's Shoe Valet deposit
CASCADE ACCEPTANCE: Court Extends Plan Confirmation Deadline
------------------------------------------------------------
The Hon. Alan Jaroslovsky of the U.S. Bankruptcy Court for the
Northern District of California extended from March 30, 2010, to
April 27, 2010, the date to convert Cascade Acceptance
Corporation's case to one under Chapter 7 unless a Chapter 11 Plan
is confirmed.
The extension was based on the stipulation to extend deadline to
confirm Chapter 11 Plan filed February 1, 2001.
Mill Valley, California-based Cascade Acceptance Corporation filed
for Chapter 11 bankruptcy protection on November 23, 2009 (Bankr.
N.D. Calif. Case No. 09-13960). Douglas B. Provencher, Esq., at
Law Offices of Provencher and Flatt assists the Company in its
restructuring effort. The Company listed $50,000,001 to
$100,000,000 in assets and debts.
CASCADE ACCEPTANCE: Files Full-but-Delayed Payment Plan
-------------------------------------------------------
Cascade Acceptance Corporation filed with the U.S. Bankruptcy
Court for the Northern District of California a Disclosure
Statement explaining its proposed Plan of Reorganization.
The Debtors will begin soliciting votes on the Plan following
approval of the adequacy of the information in the Disclosure
Statement.
According to the Disclosure Statement, the Plan provides for the
reorganization of the Debtor and payment or provision for all of
the Debtor's creditors. The Plan also provides for the
disposition of the Debtor's assets. The Debtor proposes to pay
all creditors in full over a period of six years.
Claims in various classes will be treated as follows.
* Class 1 (Secured Tax Claims) -- will be paid in full in five
equal annual installments.
* Class 2 (Secured Claims) -- will be paid according to the
terms and condition of the existing contract. Any existing
defaults in any terms or conditions of the underlying loan
documentation will be deemed cured by the confirmation of the
Plan.
* Class 3 (Unsecured Priority Claims) -- will be paid in full
in five equal annual installments with interest at the Plan
interest rate.
* Class 4 (Unsecured Claims - $18,522,008) -- unless agreed
otherwise by the Class 4 creditor, allowed Class 4 claims
will retain their promissory notes with these modifications:
(i) the promissory note will bear interest at Plan interest
rate of $3%;
(ii) the due date of the Class Four Reorganized Debtor
Promissory Note will be 36 months from the effective
date;
(iii) the Reorganized Debtor will make payments from the
accumulated cash on hand. Whether or not payment will
be made towards the principal amount of the promissory
note will be determined by the Reorganized Debtor.
* Class 5 (Special Unsecured Claims) -- upon application to the
Reorganized Debtor in writing, any creditor may request that
the Reorganized Debtor's board of directors consider and
approve a special distribution to that creditor as a Class 5
creditor for a sum not to exceed $10,000.
* Class 6 (Subordinated Claims) -- unless agreed otherwise by a
Class 6 claims will retain their promissory notes.
* Class 7 -- will retain ownership rights.
The Debtor proposes to use its cash on hand to pay claims due on
the effective date. Payments due after the effective date will be
made from the Reorganized Debtor's income or other funds.
After the effective date, the Reorganized Debtor may obtain new
secured or unsecured financing or refinance indebtedness.
A full-text copy of the Disclosure Statement is available for free
at http://bankrupt.com/misc/CascadeAcceptance_DS.pdf
About Cascade Acceptance
Mill Valley, California-based Cascade Acceptance Corporation filed
for Chapter 11 bankruptcy protection on November 23, 2009 (Bankr.
N.D. Calif. Case No. 09-13960). Douglas B. Provencher, Esq., at
Law Offices of Provencher and Flatt assists the Company in its
restructuring effort. The Company listed $50,000,001 to
$100,000,000 in assets and debts.
CATALYST PAPER: S&P Keeps 'CC' Corporate Credit Rating
------------------------------------------------------
Standard & Poor's Rating Services said it kept its ratings,
including its 'CC' long-term corporate credit rating, on
Vancouver-based Catalyst Paper Corp. on CreditWatch with negative
implications, where they were placed Nov. 25, 2009.
Catalyst Paper continues to pursue an offer to exchange its senior
unsecured notes with an 8.625% coupon due 2011 for new senior
secured notes due December 2016. The current exchange offer has
been extended and is set to expire on March 5, 2010. As of
Feb. 25, 2010, 89.96% of the 8.625% senior unsecured notes
outstanding had been tendered. Standard & Poor's will likely
lower the ratings on Catalyst Paper to 'SD' (selective default)
upon completion of the exchange offer.
"Standard & Poor's views the offer as distressed because it
represents a discount on the face value of the existing senior
unsecured debt," said Standard & Poor's credit analyst Jatinder
Mall. "S&P will likely resolve the CreditWatch on Catalyst Paper
once the exchange offer is completed," Mr. Mall added.
CELL THERAPEUTICS: Stonefield Josephson Raises Substantial Doubt
----------------------------------------------------------------
Stonefield Josephson Inc. of San Francisco, California, expressed
substantial doubt against Cell Therapeutics Inc.'s ability as a
going concern. The firm reported that the company sustained loss
from operations over the audit periods, incurred an accumulated
deficit, and has substantial monetary liabilities in excess of
monetary assets as of Dec. 31, 2009.
The Company reported $69.59 million in total assets and
$87.73 million in total liabilities, resulting to a $18.76 in
million stockholders' deficit at Dec. 31, 2009.
The Company incurred $95.39 million net loss for 12 months ended
Dec. 31, 2009, compared with %180.02 million net loss in 2008.
A full-text copy of the Company's annual report on Form 10-K is
available for free at http://ResearchArchives.com/t/s?5629
About Cell Therapeutics
Headquartered in Seattle, Cell Therapeutics, Inc. (NASDAQ and MTA:
CTIC) -- http://www.CellTherapeutics.com/-- is a
biopharmaceutical company that develops an integrated portfolio of
oncology products aimed at making cancer more treatable.
Subsequent to the closure of its Bresso, Italy operations in
September 2009, CTI's operations are conducted solely in the
United States.
Bankruptcy Warning
In its Form 10-Q report for the period ended September 30, 2009,
filed with the Securities and Exchange Commission, the Company
warned it does not expect it will have sufficient cash to fund
planned operations through the second quarter of 2010, which
raises substantial doubt about its ability to continue as a going
concern. The Company said if it fails to obtain capital when
required, the Company said it may be required to delay, scale
back, or eliminate some or all of its research and development
programs and may be forced to cease operations, liquidate its
assets and possibly seek bankruptcy protection.
CENTRAL GARDEN: S&P Assigns 'B' Rating on $400 Mil. Senior Notes
----------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its
issue-level and recovery ratings to Central Garden & Pet Co.'s
proposed new $400 million senior subordinated notes due 2018. The
assigned issue-level rating is 'B', one notch lower than the
corporate credit rating on Central Garden. The recovery rating is
'5', indicating S&P's expectation for modest (10%-30%) recovery in
the event of a payment default.
At the same time, S&P raised the issue-level rating on Central
Garden's revolving credit facility to 'BB', two notches higher
than the corporate credit rating, from 'BB-'. S&P revised the
recovery rating on this secured debt to '1', indicating its
expectation for very high (90%-100%) recovery in the event of a
payment default, from '2'.
The issuer of the proposed new senior subordinated notes is
Central Garden & Pet Co. The company will use proceeds from this
new issue plus available cash on hand to fund a tender offer for
the purchase of its existing 9.125% senior subordinated notes due
2013, and to repay Central Garden's existing term loan B. The new
notes will be guaranteed on a senior subordinated basis by all of
Central Garden's domestic restricted subsidiaries, with certain
exceptions. The new notes indenture will not contain any
maintenance financial covenants. S&P's ratings are based on
preliminary terms and conditions and are subject to review of
final documentation. Upon completion of the redemption of the
company's 9.125% senior subordinated notes and the term loan B,
S&P will withdraw its ratings on those issues.
The ratings on Central Garden incorporate the seasonality in its
lawn and garden businesses, its susceptibility to commodity cost
volatility, and its historical debt-financed acquisition-oriented
growth strategy. The company's broad product portfolio and
participation in two market segments with good demographics
somewhat mitigate these risks.
Ratings List
Central Garden & Pet Co.
Corporate credit rating B+/Stable/--
Ratings Assigned
Proposed $400 mil sr sub notes due 2018. B
Recovery rating 5
Upgraded
To From
-- ----
Revolving credit facility BB BB-
Recovery rating 1 2
CHAMPION ENTERPRISES: Court OKs Sale to Centerbridge Group
----------------------------------------------------------
The sale of Champion Enterprises, Inc.'s domestic and
international operations has received final court approval. The
sale, which is subject to customary regulatory approvals, is
expected to close during the week of March 15, 2010. In
connection with the transaction, an investor group consisting of
affiliates of Centerbridge Partners, L.P., MAK Capital Fund LP and
Sankaty Advisors, LLC will invest $50 million in new capital to
support the operations and growth initiatives of the new company.
The transaction is supported by a group of Champion's current
lenders who, together with the lead investors, will exchange 100
percent of existing debt under Champion's pre-petition and debtor-
in-possession senior secured credit agreements for equity in the
new company and a $40 million senior secured five year note.
"The pending completion of this transaction is a significant step
forward for Champion and represents very positive news for our
customers, employees and other business partners," said William C.
Griffiths, Chairman, President and Chief Executive Officer of
Champion Enterprises, Inc. "Upon completion of the transaction,
our business will be significantly deleveraged and, as a result,
positioned to capitalize on our strong market presence and many
years of operational improvements. The infusion of new capital
will allow us to fund growth initiatives as the housing markets
begin to recover, and is particularly well timed in light of the
upcoming spring selling season."
About Champion Enterprises
Troy, Michigan-based Champion Enterprises, Inc., and its
subsidiaries are international manufacturers of factory-built
homes and steel-framed modular buildings, with operations in the
United States, Canada and the United Kingdom. Buildings
constructed by Champion and its subsidiaries consist of both
single and multi-module units designed for either commercial or
residential purposes. Champion products range from single-module
HUD-Code homes to sophisticated commercial structures such as
hotels.
The Company filed for Chapter 11 on November 15, 2009 (Bankr. D.
Del. Case No. 09-14019). The Company's affiliates also filed
separate bankruptcy petitions. James E. O'Neill, Esq., Laura
Davis Jones, Esq., Mark M. Billion, Esq., Timothy P. Cairns, Esq.,
at Pachulski Stang Ziehl & Jones LLP, assist Champion in its
restructuring effort. The Company listed $576,527,000 in assets
and $521,337,000 in liabilities as of October 3, 2009.
CHIQUITA BRANDS: S&P Assigns 'BB-' Initial Senior Secured Rating
----------------------------------------------------------------
On March 2, 2010, Standard & Poor's Ratings Services assigned its
preliminary 'BB-' senior secured, preliminary 'B' senior unsecured
debt, and preliminary 'CCC+' subordinated debt ratings to Chiquita
Brands International Inc.'s (B/Stable/--) $350 million shelf
registration. S&P expects net proceeds to be used for general
corporate purposes, which may include working capital, capital
expenditures, repayment or refinancing of indebtedness, and
acquisitions.
"The ratings on Cincinnati, Ohio-based Chiquita reflect the
company's high debt leverage, volatile operating performance, and
its cash flow concentration in bananas," said Standard & Poor's
credit analyst Alison Sullivan. The company competes in the fruit
and vegetable industry, which is mature and faces uncontrollable
factors such as global supply, world trade policies, political
risk, currency swings, weather, and disease.
The outlook on the corporate credit rating is stable. The outlook
reflects lower leverage relative to the year ago period, and a
solid liquidity profile. S&P expects credit measures to stay
close to current levels, on average, (including 5.7x average total
debt to EBITDA and 16% average funds from operations to total debt
for the 12 months ended Sept. 30, 2009), to maintain the stable
outlook. S&P could lower the ratings if performance declines
and/or covenant cushion weakens. S&P could consider an upgrade if
the company sustains improved performance, particularly within
salads, and maintains a rolling four-quarter average leverage
ratio of 5x or less.
Ratings List
Chiquita Brands International Inc.
Corporate credit rating B/Stable/--
Assigned Ratings
$350 million shelf registration
Preliminary senior secured BB-
Preliminary senior unsecured debt B
Preliminary subordinated debt CCC+
CHRYSLER LLC: To Post Slight Car Sales Increase in February
-----------------------------------------------------------
Bloomberg News' Mike Ramsey said on March 2 Chrysler Group LLC was
slated to post an increase of a few hundred units compared with a
year earlier, the first sales gain since December 2007. Mr.
Ramsey cited a person familiar with the results. That source said
Chrysler sales will rise by less than 1%. Chrysler sold 84,050
vehicles a year earlier, Bloomberg notes. The sales report has
yet to be made public.
On Wednesday, the Troubled Company Reporter ran a story on General
Motors' and Ford's sales. According to the TCR, U.S. dealers of
GM's Chevrolet, Buick, GMC and Cadillac reported sales of 138,849,
up a combined 32% compared to February 2009. The results were
driven by the continued strong growth of new GM crossovers and
passenger cars.
The TCR reported that Ford Motor Company said higher sales for
every brand and in every product category propelled the Company to
a 43% sales increase in February versus a year ago. Compared with
January, Ford's February sales are up 22%.
According to Neal E. Boudette and Kevin Kingsbury at The Wall
Street Journal, Ford surpassed GM in sales last month for the
first time in at least 50 years, "presenting a new headache for
the government-owned car maker as it struggles to return to
profitability."
According to the Journal, Ford said it sold 142,006 cars and light
trucks in the U.S. in February, 43% more than a year ago -- and
471 more than GM. While Ford's results were boosted by sales to
rental-car companies and other fleets, it was the first time since
at least 1960 that Ford outsold its larger rival except for two
months in 1998 when GM was hurt by strikes, the Journal said,
citing Edmunds.com, an automotive data provider. GM's February
sales rose 11.5%, to 141,535 vehicles.
GM has overhauled its top managers hours after the sales results
were released -- the second executive shuffle in three months.
The Journal said the news underscored the impatience of GM Chief
Executive Edward E. Whitacre Jr. and the heat GM is feeling from a
resurgent Ford.
About Chrysler Group LLC
Chrysler Group LLC, formed in 2009 from a global strategic
alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Ram
Truck, Mopar(R) and Global Electric Motorcars (GEM) brand vehicles
and products. 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 Ram Truck. 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.
About Chrysler LLC
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)
CODA OCTOPUS: Posts $9.4 Million Net Loss in FY Ended Oct. 31
-------------------------------------------------------------
Coda Octopus Group, Inc., filed its annual report on Form 10-K,
showing a net loss of $9.4 million on $13.2 million of revenue for
the year ended October 31, 2009, compared with a net loss of
$7.9 million on $17.0 million of revenue for 2008.
The Company's balance sheet as of October 31, 2009, showed
$13.1 million in assets and $21.0 million of debts, for a
stockholders' deficit of $7.9 million.
RBSM LLP, in New York, said that the Company has failed to comply
with certain covenants in connection with the secured convertible
debt. The Company and the noteholder entered into an agreement,
whereby the noteholder agreed not to undertake any adverse actions
against the Company, subject to the Company complying with the
terms of the agreement and the noteholder has waived its right to
demand repayment as a result of the Company's failure to observe
certain specified loan covenants.
In the Form 10-K report, the Company said that for the fiscal year
ended October 31, 2009, the Company has an accumulated deficit of
$59.1 million, negative working capital of $442,520, a capital
deficit of $7.9 million and generated a deficit in cash flow from
operations of $1.7 million in 2009 against $5.3 million in 2008.
The Company has been dependent upon the ability to generate
revenue from the sale of its products and services and the
discretion of the note holder to release cash to cover operations.
Management believes that based upon its current cost reduction
program to reduce expenses by $3.35 million annually; based upon
the reorganization of its business, customer prospects have been
enhanced and is evident in receipt of approximately $3.9 million
dollars of additional contracts and purchase orders during the
first quarter of fiscal year end 2010; based upon the Company's
cash flow projections for its business operations through January
2011; collectability of its receivables in the ordinary course of
business; based on the Noteholder's 12 month extension of the cash
control framework agreement and the Noteholder's agreement to
waive its right to demand repayment of the loan until March 16,
2011, the Company will be able to continue its operations through
October 31, 2010. The Company's ability to continue as a going
concern is ultimately dependent upon achieving profitable
operations and generating sufficient cash flows from operations to
meet future obligations.
A full-text copy of the annual report is available for free at:
http://researcharchives.com/t/s?55fa
Based in New York, Coda Octopus Group, Inc. is engaged in 3D
subsea technology and is the developer and patent holder of real-
time 3D sonar technology. The Company produces hardware, software
and fully integrated systems which are sold and supported on a
worldwide basis. In addition, through its two engineering
services subsidiaries, Coda Octopus Martech Ltd, based in
Weymouth, England, UK, and Coda Octopus Colmek, Inc., based in
Salt Lake City, Utah, the Company provides engineering services to
a wide variety of clients in the subsea, defense, nuclear and
pharmaceutical industries.
COLONIAL BANCGROUP: FDIC Lambastes Schulte's Bid for Payday
-----------------------------------------------------------
Law360 reports that the Federal Deposit Insurance Corp. has
alleged that attorneys at Schulte Roth & Zabel LLP have tried to
soak the estate of The Colonial Bancgroup Inc. with nearly
$1 million in professional fees, including $130,000 for what
should have been a day's worth of research.
Headquartered in Montgomery, Alabama, The Colonial BancGroup, Inc.
(NYSE: CNB) was holding company to Colonial Bank, N.A, its
banking subsidiary. Colonial bank -- http://www.colonialbank.com/
-- operated 354 branches in Florida, Alabama, Georgia, Nevada and
Texas with over $26 billion in assets. On August 14, 2009,
Colonial Bank was seized by regulators and the Federal Deposit
Insurance Corporation was named receiver. The FDIC sold most of
the assets to Branch Banking and Trust, Winston-Salem, North
Carolina. BB&T acquired $22 billion in assets and assumed
$20 billion in deposits of the Bank.
Colonial BancGroup filed for Chapter 11 bankruptcy protection on
August 25, 2009 (Bankr. M.D. Ala. Case No. 09-32303). W. Clark
Watson, Esq., at Balch & Bingham LLP and Rufus T. Dorsey IV,
Esq., at Parker Hudson Rainer & Dobbs LLP, assist the Company in
its restructuring effort. The Company listed $45,000,000 in
assets and $380,000,000 in debts in its bankruptcy filing.
COMMUNITYSOUTH FINANCIAL: Posts $18.3 Million Net Loss in 2009
--------------------------------------------------------------
CommunitySouth Financial Corporation filed its annual report on
Form 10-K, showing a net loss of $18.3 million on $10.6 million of
net interest income for 2009, compared with a net loss of
$3.3 million on $10.1 million of net interest income for 2008.
The increase in net interest income was due primarily to a
decrease in deposit rates, translating into lower interest
expense.
The Company's balance sheet as of Dec. 31, 2009, showed
$421.5 million in assets, $412.8 million of debts, and
$8.7 million in stockholders' equity.
Elliott Davis, LLC, in Greenville, South Carolina, expressed
substantial doubt about the Company's ability to continue as a
going concern. The independent auditors noted that the Company's
subsidiary bank, CommunitySouth Bank and Trust, has significant
capital and liquidity issues.
"The Company has incurred approximately $19 million and $3 million
in losses during 2009 and 2008, respectively, and the Bank is
"undercapitalized" under regulatory capital guidelines. In
addition to being "undercapitalized", effective February 23, 2010,
the Bank became subject to a regulatory Consent Order with the
Federal Deposit Insurance Corporation and the South Carolina Board
of Financial Institutions."
Under the terms of the Consent Order, the Bank's various sources
of liquidity will be restricted.
A full-text copy of the annual report is available for free at:
http://researcharchives.com/t/s?5677
About the Company
Easley, South Carolina-based CommunitySouth Financial Corporation
is a bank holding company. The Company's wholly-owned subsidiary,
CommunitySouth Bank and Trust, commenced business on January 18,
2005, and is primarily engaged in the business of accepting
savings, demand, and time deposits and providing mortgage,
consumer and commercial loans to the general public.
COOPER-STANDARD: May Have Alternate Chapter 11 Plan
---------------------------------------------------
Cooper-Standard Holdings Inc. said that since filing a Chapter 11
proposed plan of reorganization, it has received an alternative
plan proposal from certain creditors. Cooper-Standard says it is
currently exploring the proposal.
Cooper-Standard made the disclosure about the alternative plan in
its request for an extension (i) until June 29 of its exclusive
period to propose a plan, and (ii) until August 30 of its
exclusive period to solicit support for the plan. A hearing on
the proposed extension is scheduled for March 18.
Cooper-Standard is scheduled to seek approval of the disclosure
statement explaining its Chapter 11 plan at a hearing on March 9.
The Debtor is targeting an April 21 confirmation hearing for the
plan.
The Chapter 11 Plan
Under Cooper-Standard's existing plan, debt will be reduced to
$430 million when the Company emerges from bankruptcy,
representing a drop of more than 60% or $700 million. The Debtors
had total liabilities of more than $1 billion when they filed for
bankruptcy protection on August 3, 2009.
The Plan proposes to pay in full in cash the Debtors' prepetition
credit facility and debtor-in- possession financing. General
unsecured claims against Cooper-Standard Automotive Inc. and all
of its subsidiary debtors will also receive payment in full in
cash.
Under the Plan, holders of claims that stemmed from the 7% Senior
Notes due 2012 will be issued about 18.75% or 4,083,333 shares of
the new common stock. Eligible holders of senior note claims
will acquire their share of rights to purchase about 45% or
9,800,000 of the new common stock.
Holders of claims which stemmed from the 8-3/8% Senior
Subordinated Notes due 2014 will be issued about 6.25% or
1,361,111 shares of the new common stock, and warrants to acquire
an additional 5% of the stock or, at the election of those
holders, a cash payment in lieu of warrants. Eligible holders of
senior subordinated notes claims will acquire their share of
rights to acquire 15% or 3,266,667 shares of the new common stock.
About Cooper-Standard
Cooper-Standard Automotive Inc. -- http://www.cooperstandard.com/
-- headquartered in Novi, Michigan, 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
custoemrs include Ford Motor Company, General Motors, Chrysler,
Audi, Volkswagen, BMW, Fiat and Honda, among other automakers.
Cooper-Standard Automotive 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-
COSINE COMMUNICATIONS: Posts $597,000 Net Loss in 2009
------------------------------------------------------
CoSine Communications, Inc., filed its annual report on Form 10-K,
showing a net loss of $597,000 for 2009, compared with a net loss
of $15,000 for 2008.
The Company's balance sheet as of Dec. 31, 2009, showed
$22.6 million in assets, $232,000 of debts, and $22.4 million of
stockholders' equity.
Burr Pilger Mayer, Inc., in San Jose, California, expressed
substantial doubt about the Company's ability to continue as a
going concern. The independent auditors pointed to the Company's
actions in September 2004 in connection with its ongoing
evaluation of strategic alternatives, to terminate most of its
employees and discontinue production activities in an effort to
conserve cash.
A full-text copy of the annual report is available for free at:
http://researcharchives.com/t/s?5675
Los Gatos, California-based CoSine Communictions, Inc. was, until
the end of fiscal year 2004, was a provider of carrier network
equipment products and services offering a portfolio of
communications products and services to business and consumer
customers.
COTT CORP: Swings to $81.5 Mil. Net Income for FY2009
-----------------------------------------------------
Net income attributed to Cott Corporation was $81.5 million for
the fiscal year ended January 2, 2010, from a net loss of
$122.8 million for the year ended December 27, 2008. Net income
attributed to Cott Corp. was $14.0 million for the three months
ended January 2, 2010, from a net loss of $12.1 million for the
three-month period ended December 27, 2008.
Net revenue was $1.596 billion for the year ended January 2, 2010,
from $1.648 billion for the year ended December 27, 2008. Net
revenue was $386.0 million for the three months ended January 2,
2010, from $371.4 million for the three months ended December 27,
2008.
Revenue declined 3.1%, but increased 2.4% excluding the impact of
foreign exchange, as lower volumes in North America, Mexico and
Royal Crown International offset the impact of higher volumes in
the United Kingdom/Europe operating segment and improved pricing
and product mix.
At January 2, 2010, Cott had total assets of $873.8 million
against total liabilities of $472.5 million. Total Cott Corp.
equity was $386.0 million at January 2.
"I am pleased that the fourth quarter continued the trend of
improved results and allowed us to finish what has been an
excellent year," commented Cott's Chief Executive Officer, Jerry
Fowden. "As we begin 2010, we are focusing on the operational
objectives that worked so well for us in 2009 and on pursuing our
goals for smart new business wins," added Mr. Fowden.
"Successfully extending our long-term debt maturity during the
quarter was a key milestone in our efforts to strengthen our
balance sheet and to improve our financial flexibility," commented
Cott's Chief Financial Officer, Neal Cravens.
A full-text copy of Cott's earnings release is available at no
charge at http://ResearchArchives.com/t/s?5632
About Cott Corp.
Cott Corporation (NYSE:COT; TSX:BCB) is one of the world's largest
non-alcoholic beverage companies and the world's largest retailer
brand soft drink provider. In addition to carbonated soft drinks,
Cott's product lines include clear, still and sparkling flavored
waters, juice-based products, bottled water, energy drinks and
ready-to-drink teas. Cott operates in five operating segments --
North America, United Kingdom, Mexico, Royal Crown International
and All Other, which includes its Asia reporting unit and
international corporate expenses. Cott closed its active Asian
operations at the end of fiscal year 2008.
* * *
As reported by the Troubled Company Reporter on September 7, 2009,
Moody's Investors Service upgraded Cott's Corporate Family Rating
and Probability of Default rating to B3 from Caa1, and the rating
on the $275 million senior sub notes due 2011 to Caa1 from Caa2.
The speculative grade liquidity rating was affirmed at SGL-3. The
rating outlook is stable.
This concludes the Troubled Company Reporter's coverage of Cott
Corp. until facts and circumstances, if any, emerge that
demonstrate financial or operational strain or difficulty at a
level sufficient to warrant renewed coverage.
CYNERGY DATA: Aims to File Liquidating Plan This Month
------------------------------------------------------
Bill Rochelle at Bloomberg News reports that Cynergy Data LLC is
asking the Bankruptcy Court to extend its exclusive period to
propose a Chapter 11 plan until June 1. A hearing on the
extension is scheduled for March 19.
According to the report, Cynergy Data, which has sold its business
to ComVest Group, hopes to file a liquidating Chapter 11 plan in
time for the bankruptcy judge to hold a hearing on April 1 to
approve the explanatory disclosure statement. If Cynergy keeps to
schedule, the confirmation hearing on the plan would take place
April 23, the Bloomberg report said.
About Cynergy Data
Launched in 1995, Cynergy Data is a merchant credit card
processing service provider that gives business owners excellent
customer support and unparalleled merchant services. The company
emphasizes honest, service-oriented business practices and
customer-friendly products and services. During the past 14
years, Cynergy Data has rapidly expanded from a two-person
operation to one that employs over 130 service-oriented team
members. Headquartered in New York City, Cynergy Data manages a
portfolio of nearly 80,000 merchants processing in excess of $10
billion annually.
The Company and two affiliates -- Cynergy Data Holdings, LLC,
and Cynergy Prosperity Plus, LLC -- filed for Chapter 11 on
September 1, 2009 (Bankr. D. Del. Case No. 09-13038).
The Company's legal advisor is Nixon Peabody LLP; its financial
and restructuring advisor is CM&D Management Services LLC; its
industry expert is Unicorn Partners, LLC; and its investment
bankers are Stifel, Nicolaus & Company and Peter J. Solomon
Company. Aside from Nixon peabody, Pepper Hamilton LLP has been
hired as bankruptcy and restructuring counsel. Charles D. Moore
of Conway MacKenzie, Inc., serves as chief restructuring officer.
Kurtzman Carson & Consultants LLC serves as claims and notice
agent.
Cynergy Data said that it had assets of $109,546,132 against debts
of $186,183,032 as of June 30, 2009.
Cynergy Data filed for Chapter 11 to complete the sale of all of
its assets to an affiliate of The ComVest Group. The $81 million
sale of the assets was completed October. The Debtor was renamed
to Liquidation Co. LLC following the sale.
DAVID SOLOMONT: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: David Solomont
60 Heath Hill
Brookline, MA 02445
Bankruptcy Case No.: 10-12128
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
District of Massachusetts (Boston)
Judge: Frank J. Bailey
Debtor's Counsel: Neil D. Warrenbrand, Esq.
Law Offices of Neil D. Warrenbrand
One McKinley Square
Boston, MA 02109
Tel: (617) 720-2286
Email: neil@warrenbrandlaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor did not file a list of its 20 largest unsecured
creditors when it filed its petition.
The petition was signed by Mr. Solomont.
DEERWOOD HOMES: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Deerwood Homes Bellville, LP
15958 City Walk, Suite 290
Sugar Land, TX 77479
Bankruptcy Case No.: 10-31729
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Southern District of Texas (Houston)
Judge: Karen K. Brown
Debtor's Counsel: Edward L. Rothberg, Esq.
Hoover Slovacek, LLP
5847 San Felipe, Suite 2200
Houston, TX 77057
Tel: (713) 977-8686
Fax: (713) 977-5395
Email: rothberg@hooverslovacek.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor did not file a list of its 20 largest unsecured
creditors when it filed its petition.
The petition was signed by Stephen A. Norwood.
DENNY'S CORP: Investor Group Nominates Candidates to Board
----------------------------------------------------------
A group of shareholder investors of Denny's Corporation led by Oak
Street Capital Master Fund, Ltd., a has established "The Committee
to Enhance Denny's" for the purpose of seeking representation on
the Company's Board of Directors.
On March 1, 2010, Oak Street Master delivered a letter to the
Corporate Secretary of the Company nominating Patrick H. Arbor,
Jonathan Dash and David Makula to be elected to the Board at the
2010 annual meeting of stockholders of the Company.
The group consists of:
-- Oak Street
* Oak Street Capital Master Fund, Ltd., a Cayman Islands
exempted company;
* Oak Street Capital Management, LLC, a Delaware limited
liability company;
* David Makula;
* Patrick Walsh;
-- Dash
* Dash Acquisitions LLC, a Delaware limited liability
company;
* Jonathan Dash;
-- Soundpost
* Soundpost Capital, LP, a Delaware limited partnership;
* Soundpost Capital Offshore, Ltd., a Cayman Islands exempted
Company;
* Soundpost Advisors, LLC, a Delaware limited liability
Company;
* Soundpost Partners, LP, a Delaware limited partnership;
* Soundpost Investments, LLC, a Delaware limited liability
Company;
* Jaime Lester;
-- Lyrical
* Lyrical Opportunity Partners II, L.P., a Delaware limited
Partnership;
* Lyrical Opportunity Partners II, Ltd., a Cayman Islands
exempted company;
* Lyrical Opportunity Partners II GP, L.P., a Delaware
limited partnership;
* Lyrical Corp III, LLC, a Delaware limited liability
company;
* Lyrical Partners, L.P., a Delaware limited partnership;
* Lyrical Corp I, LLC, a Delaware limited liability company;
* Jeffrey Keswin; and
-- Patrick H. Arbor
As of the close of business on March 1, 2010, the members of The
Committee to Enhance Denny's collectively owned an aggregate of
6,245,476 Shares, constituting 6.5% of the Shares outstanding.
The group is represented by:
Steve Wolosky, Esq.
Ron S. Berenblat, Esq.
OLSHAN GRUNDMAN FROME ROSENZWEIG & WOLOSKY LLP
Park Avenue Tower
65 East 55th Street
New York, New York 10022
Tel: (212) 451-2300
4th Quarter and Full-Year Results
On February 17, Denny's reported net income of $17.878 million for
the fourth quarter ended December 30, 2009, from a net loss of
$3.48 million for the 2008 fourth quarter. Denny's reported net
income of $41.554 million for the year from $12.742 million in
2008.
Total operating revenue was $140.466 million for the 2009 fourth
quarter from $184.728 million for 2008. Total operating revenue
was $608.103 million for 2009 from $760.271 million in 2008.
At December 30, 2009, the Company had total assets of
$312.627 million against $440.125 million in total liabilities,
resulting in $127.498 million shareholders' deficit. The December
30 balance sheet showed strained liquidity: The Company had total
current assets of $58.345 million against $92.108 million in total
current liabilities.
Nelson Marchioli, President and Chief Executive Officer, stated,
"In 2009, Denny's continued to make significant progress towards
its strategic goals of building new units and growing the system's
net unit count, refranchising company units, paying down debt, and
growing profitability. The strength of Denny's emerging business
model is evidenced in our ability to deliver on these
accomplishments despite the difficult economic environment that
put significant pressure on the industry's, and Denny's, same-
store sales."
Mark Wolfinger, Executive Vice President, Chief Administrative
Officer and Chief Financial Officer, stated, "Visibility into 2010
continues to be muted for both the industry and Denny's. So while
we are encouraged by a stronger sales driving plan for 2010 we
remain cautious until we deliver improved sales trends on a
sustained basis. Our ongoing transition to a cash flow generating
and franchise-focused business model has been driving margin and
earnings growth but the impact of further sales declines could
lessen these benefits in the near term. We will continue to
manage our expenses and capital spending to protect liquidity,
reduce our debt and further strengthen our balance sheet."
A full-text copy of the Company's earnings release is available at
no charge at http://ResearchArchives.com/t/s?5654
Committee Initiatives
The Co-Chairmen of the Committee -- Jonathan Dash, David Makula
and Patrick Walsh -- commented, "The Company's existing board and
management team have been given a sufficiently long period of time
to demonstrate the effectiveness of their strategy, and we believe
they have failed. We do not believe their strategy has created
value for shareholders. The weaknesses of Denny's management have
forced us to seek changes to the board in the interest of all
shareholders. If the status quo is maintained, we are deeply
concerned that the Company's future will mirror its past."
"The record is clear -- the current Denny's board has overseen
significant destruction of shareholder value. Denny's share price
has plummeted by approximately 75.6% since the shares began
trading in November 1997 through December 31, 2009(1). Over the
past five completed years alone, Denny's share price has declined
by 51.3%(2), an unacceptable outcome. We note that the share
price has appreciated significantly since the filing of our
initial Schedule 13D on January 21, 2010."
"We believe the board should have admitted years ago that Denny's
CEO, Nelson Marchioli, will not be able to turn around the
Company. We believe that his poor operating and capital
allocation records speak for themselves. To add insult to injury,
the Denny's board has generously rewarded management despite poor
stock price and financial performance."
The Committee's issues with the current Denny's board and
management are:
-- Ceding the #1 market position to International House of
Pancakes
-- Failure to grow system-wide restaurants
-- Unsustainable declines in key operating trends such as
guest traffic
-- Inappropriately high general and administrative expenses
-- Imprudent capital allocation decisions
-- Lack of accountability for management at the board level
-- Extremely poor stock performance
According to the group, Denny's system-wide units peaked 10 years
ago, at 1,822 restaurants, shortly before Nelson Marchioli was
appointed CEO in 2001. Over the past decade, Denny's management
and board oversaw a 15% decline in total system-wide restaurants
to 1,551 units. This stands in stark contrast to the Company's
closest competitor, IHOP, which during the same timeframe
increased system-wide restaurants from 922 units to 1,433 units.
According to the group, "We believe shareholder concerns have been
ignored. We are aware that the Denny's Franchisee Association has
expressed to the Denny's board its specific concerns with current
management which have also been ignored. We are deeply concerned
that many of the largest franchisees of Denny's have lost faith in
management's ability to turn around the Company's operating
performance."
"We are also frustrated that Mr. Marchioli has not built a strong
management team. Rather than recruiting and nurturing talented
executives, the Company has announced drastic leadership changes
involving key members of management -- most recently the departure
of the Chief Marketing and Innovation Officer and the Chief
Operating Officer. Merely replacing those two executives will not
address the critical operational issues facing CEO, Nelson
Marchioli, who hired those two executives."
A general outline of the initiatives that the group's nominees
would seek to implement:
* Create a pay-for-performance culture that clearly and
measurably aligns management's interests with those of
shareholders
* Implement a cost structure that provides Denny's with a
source of competitive advantage, by sustainably reducing
annual operating expenses by at least $15 million
* Reverse the declining trend in guest traffic and comp store
sales with more effective marketing and an improved price
-to-value relationship for the customer
* Rationalize capital expenditures to an average of less than
$10 million per year
* Halt value-eroding sales of company-owned restaurant units
at unreasonably low prices
* Refocus marketing efforts on a consistent value message,
not on marketing gimmicks that send the wrong message and
attract the wrong customer base, and
* Restore system-wide unit growth through franchisee
Development
A full-text copy of the group's statement is available at no
charge at http://ResearchArchives.com/t/s?5633
Patrick H. Arbor is a director of Macquarie Futures USA Inc., a
Futures Commission Merchant and clearing member of the Chicago
Mercantile Exchange and other exchanges. Mr. Arbor is a long-time
member of the Chicago Board of Trade.
Jonathan Dash is the President of Dash Acquisitions LLC, an
investment management firm. He is a director of Western Sizzlin
Corporation, a publicly-traded restaurant chain with 102
restaurants. He is an Advisor to the Chairman and Chief Executive
Officer of The Steak n Shake Company, a publicly-traded restaurant
chain with 485 restaurants.
David Makula is the Founder and Managing Member of Oak Street
Capital Management, LLC, an investment management firm. He was
previously a Research Analyst with Coghill Capital Management,
LLC, an investment management firm. He also served as an
Investment Banker for Salomon Smith Barney, where he focused on
mergers and acquisitions across a variety of sectors. Mr. Makula
holds a CPA certificate from the State of Illinois.
About Denny's Corp.
Based in Spartanburg, South Carolina, Denny's Corporation (NASDAQ:
DENN) -- http://www.dennys.com/-- is one of America's largest
full-service family restaurant chains, consisting of 1,289
franchised and licensed units and 256 company-owned units, with
operations in the United States, Canada, Costa Rica, Guam, Mexico,
New Zealand and Puerto Rico.
As of September 30, 2009, Denny's had total assets of $330,718,000
against total liabilities of $477,448,000, resulting in
shareholders' deficit of $146,730,000. Denny's September 30, 2009
balance sheet also showed strained liquidity with total current
assets of $65,889,000, including $29,886,000 of cash and cash
equivalents, against total current liabilities of $95,790,000.
DOLLAR THRIFTY: Extends Vehicle Supply Deal with Ford Motor
-----------------------------------------------------------
Dollar Thrifty Automotive Group Inc. has extended its vehicle
supply agreement with Ford Motor Company for an additional year.
The agreement will allow the Company to source a portion of its
annual vehicle purchases through Ford until August 2013 and can be
extended further with joint approval.
"We are very pleased with our first-year results under our Ford
supply agreement and are excited about Ford's future product
offerings. We continue to receive very positive feedback from our
rental customers on Ford vehicles. This contract extension is a
continuation of our long-term commitment to maintaining a
diversified fleet," said Scott L. Thompson, President and Chief
Executive Officer.
The Company said that its 2010 vehicle purchases include 34% Ford,
30% Chrysler, 20% General Motors, 6% Nissan and 10% other
automobile manufacturers.
Dollar Thrifty Automotive Group, Inc. is headquartered in Tulsa,
Oklahoma. Driven by the mission "Value Every Time," the Company's
brands, Dollar Rent A Car and Thrifty Car Rental, serve value-
conscious travelers in over 70 countries. Dollar and Thrifty have
over 600 corporate and franchised locations in the United States
and Canada, operating in virtually all of the top U.S. and
Canadian airport markets. The Company's approximately 6,400
employees are located mainly in North America, but global service
capabilities exist through an expanding international franchise
network.
In November 2009, Standard & Poor's Ratings Services raised its
corporate credit rating of Dollar Thrifty to 'B-' from 'CCC', in
light of the Company's improved operating and financial
performance that began in mid-2009. Moody's Investors Service
also upgraded Dollar Thrifty's Probability of Default Rating to
'B3' from 'Caa2' and Corporate Family Rating to 'B3' from 'Caa3'
DRUG FAIR: Has Until March 29 to Propose a Chapter 11 Plan
----------------------------------------------------------
The Hon. Brendan L. Shannon of the U.S. Bankruptcy Court for the
District of Delaware extended Drug Fair Group Inc.'s exclusive
periods to propose a Chapter 11 plan until March 29, 2010, and to
solicit acceptances of that plan until May 25, 2010.
Headquartered in Somerset, New Jersey, Drug Fair Group, Inc. --
http://www.drugfair.com/or http://www.costcuttersonline.com/--
fka Community Distributors, Inc., operates pharmacies and general
merchandise stores in northern and central New Jersey. The
Company, with stores in central and northern New Jersey, is
indirectly owned by Sun Capital Partners Inc., a private-equity
investor based in Boca Raton, Florida.
Drug Fair and CDI Group, Inc., filed for Chapter 11 protection on
March 18, 2009 (Bankr. D. Del. Lead Case No. 09-10897). Domenic
E. Pacitti, Esq., and Michael W. Yurkewicz, Esq., at Klehr
Harrison Harvey Branzburg & Ellers, represent the Debtors in their
restructuring efforts. Warren J. Martin, Jr., Esq., and Brett S.
Moore, Esq., at Porzio Bromberg & Newman, P.C., represent the
official committee of unsecured creditors as counsel. Norman L.
Pernick, Esq., and Patrick J. Reilley, Esq., at Cole, Schotz,
Meisel, Forman & Leonard, P.A., represent the creditors committee
as Delaware counsel. J.H. Cohn LLP is the creditors committee's
financial advisors and forensic accountants. Epiq Bankruptcy
Solutions, LLC, is the Debtors' notice and claims agent. The
Debtors listed assets of $50 million to $100 million and debts of
$100 million to $500 million.
After commencing the Chapter 11 cases, the Debtors began going out
of business sales at approximately 24 locations. On April 27,
2009, the Court approved the sale of 31 remaining stores to
Walgreen Co. for about $54 million. The Debtors are winding down
assets not included in the transactions.
EDWARD REID: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Edward Reid, Jr.
242 Granite Avenue
Milton, MA 02186
Bankruptcy Case No.: 10-12125
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
District of Massachusetts (Boston)
Judge: Frank J. Bailey
Debtor's Counsel: Paul D. McCarthy, Esq.
McCarthy and Malloy
80 Sandra Lane
North Andover, MA 01845
Tel: (978) 975-4190
Fax: (866) 843-6431
Email: lawoffice@mccarthyandmolloy.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor did not file a list of its 20 largest unsecured
creditors when it filed its petition.
The petition was signed by Edward Reid, Jr.
ELITE BAYWOOD: Case Summary & 44 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Elite Baywood, LP
dba Baywood Arms Apartments
4001 Memorial Blvd.
Port Arthur, TX 77642
Bankruptcy Case No.: 10-31760
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Southern District of Texas (Houston)
Judge: Marvin Isgur
Debtor's Counsel: Edward L. Rothberg, Esq.
Hoover Slovacek, LLP
5847 San Felipe, Suite 2200
Houston, TX 77057
Tel: (713) 977-8686
Fax: (713) 977-5395
Email: rothberg@hooverslovacek.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including a list of its
44 largest unsecured creditors, is available for free at:
http://bankrupt.com/misc/txsb10-31760.pdf
The petition was signed by Tomas Schoff.
Debtor-affiliate that filed separate Chapter 11 petition:
Arthur Square Apartments, LP
aka 2006 Arthur Square Apartments, LP
dba Poole Avenue Apartment Homes
fka Arthur Square Apartments
fka Fairway Plaza, LLC
Case No: 10-31774
Estimated Assets: $1,000 to $10,000,000
Estimated Debts: $1,000,000 to $10,000,000
ERICKSON RETIREMENT: Disclosure Statement Hearing on March 5
------------------------------------------------------------
Erickson Retirement Communities, LLC, and its debtor affiliates
ask Judge Stacey Jernigan of the United States Bankruptcy Court
for the Northern District of Texas to approve the Disclosure
Statement explaining their Second Amended Joint Plan of
Reorganization dated February 16, 2010, as containing "adequate
information" pursuant to Section 1125(a) of the Bankruptcy Code.
At the Debtors' request, the Court will convene a hearing on
March 5, 2010, to consider approval of the Disclosure Statement.
Objections, if any, to the Disclosure Statement must be in
writing and received no later than March 2 by:
* DLA Piper LLP, counsel to the Debtors
Attn: Vincent P. Slusher, Esq.
1717 Main Street
Suite 4600
Dallas, Texas 75201
* Venable LLP, counsel for the Redwood Entities
Attn: Jorian L. Rose, Esq. and Carollynn H.G. Callari, Esq.
Rockefeller Center
1270 Avenue of the Americas
New York 10020
* Bracewell & Guiliani LLP, counsel to the Creditors Committee
Attn: Samuel M. Stricklin, Esq.
1145 Ross Avenue
Suite 3800
Dallas, Texas 75202-2711
* Office of the United States Trustee
1100 Commerce
Room 9C60
Dallas Texas 75242
Attn: George F. McElreath, Esq.
The Debtors at the March 5 hearing will also seek the Court's
authority to commence solicitation of votes for the Second Amended
Joint Plan of Reorganization in accordance with certain proposed
solicitation schedule and procedures.
The Debtors ask the Court to establish March 5, 2010, as the
record date for purposes of determining (i) which creditors are
entitled to receive a Solicitation Package and may be entitled to
vote on the Plan, subject to the disallowance of that creditor's
Claims or Interests for voting purposes; (ii) the Holders of
Claims and Interests entitled to receive a Non-Voting Notice; and
(ii) counterparties to executory contracts entitled to receive
the notice of confirmation hearing of the Amended Plan and the
Disclosure Statement.
The Debtors also ask the Court to establish 5:00 p.m., April 7,
2010, or three business days before the proposed confirmation
hearing date of April 12, 2009, as the deadline by which all
Ballots on the Amended Plan should be received by the Balloting
Agent, unless extended by the Debtors in writing. Original
Ballots must be returned to the designated Ballot Processing
Center in the provided return envelope by first class mail,
postage prepaid, by overnight courier, or by hand delivery,
unless approved in advance by BMC Group in writing.
The Debtors ask the Court to schedule the confirmation hearing
for April 12, 2010. The Debtors further propose that April 9 be
set as the last date for filing and serving written objections,
comments or responses to the confirmation of the Amended Plan.
The Chapter 11 Plan
Erickson Retirement Communities and its debtor affiliates
presented to the United States Bankruptcy Court for the Northern
District of Texas their Second Amended Joint Plan of
Reorganization and accompanying Disclosure Statement on
February 16, 2010.
The Amended Plan incorporates, among others, settlements between
the Debtors and parties-in-interests in the Debtors' Chapter 11
cases.
The Plan estimate $135,799,000 in total value that will be
available for distribution. Based on the Liquidation Analysis,
the Debtors estimate a 12.9% recovery for ERC and Erickson
Construction LLC under an orderly liquidation and only an 8.2%
recovery for the same Debtor entities under a forced liquidation.
A Liquidation Analysis on the other Debtor Landowners also show
that the Landowners are expected to recover more from an orderly
liquidation than from a forced liquidation.
Full-text copies of the Second Amended Plan and Disclosure
Statement dated February 16, 2010, are available for free at:
http://bankrupt.com/misc/ERC_Feb16AmPlan.pdf
http://bankrupt.com/misc/ERC_Feb16AmDS.pdf
Blacklined versions of the Second Amended Plan and Disclosure
Statement are available for free at:
http://bankrupt.com/misc/ERC_Feb16AmPlan_blacklined.pdf
http://bankrupt.com/misc/ERC_Feb16DS_blacklined.pdf
About Erickson Retirement
The Baltimore, Maryland-based Erickson Retirement Communities LLC
owns 20 continuing care retirement communities in 11 states.
Among Erickson's 20 communities, eight are completed, 11 are open
although in construction, and one is in development. They have
23,000 residents in total.
Erickson, along with affiliates, filed for Chapter 11 on Oct. 19,
2009 (Bankr. N.D. Tex. Case No. 09-37010). DLA Piper LLP (US)
serves as counsel to the Debtors. BMC Group Inc. serves as claims
and notice agent. Houlihan, Lokey, Howard & Zoukin, Inc., is also
serving as investment and financial consultant. Alvarez & Marsal
is serving as restructuring adviser.
As of September 30, 2009, on a book value basis, ERC had
approximately $2.7 billion in assets, including $2.2 billion of
property and equipment, and $3.0 billion in liabilities.
Liabilities include $195.8 million on the revolving credit,
$347.5 million on construction credit, $64 million in accounts
payable, $47.8 million in subordinate debt, and $475 million in
purchase option deposits.
Bankruptcy Creditors' Service, Inc., publishes Erickson Retirement
Bankruptcy News. The newsletter tracks the Chapter 11 proceedings
of Erickson Retirement Communities LLC and its debtor-affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
ERICKSON RETIREMENT: Ex-Employees Balk at No-Severance Plan
-----------------------------------------------------------
In separate filings, Sharon Kirkley, Eva Moore, William James
Brattain, Linda Suzanne Vigilante, Kelly S. Kight, Robert J.
Albright, Stacey Aikman and Theodore J. Sirko complain that the
Disclosure Statement explaining Erickson Retirement Communities'
Second Amended Joint Plan of Reorganization unfairly denies
appropriate and obligated compensation to them and other laid off
employees.
The Former Employees point out that unique severance claims exist
that should be paid out as part of the Amended Plan. The Former
Employees assert that 94 employees of Erickson Retirement
Communities, LLC, had their separation agreements violated by the
suspension of their much-needed income from severance payments
within less than 24-hour notice.
The proper payout of the Severance Claims is less than 0.005% of
the total $365 million purchase price to be paid by Redwood-ERC
Senior Living Holdings, LLC, for substantially all of the
Debtors' assets, the Former Employees tell the Court. However,
for the 94 ERC employees, their employment represent their whole
livelihood so that cutting off the severance payments has the
most injurious effect on them, the Former Employees assert.
The Former Employees add that unique claims of inequitable
treatment exist with regards to the disbursement or lack of
disbursement of the "GPP Employment Benefit Plan."
The Former Employees thus contend that the Disclosure Statement
should not allocate 0% to unsecured creditors. Instead, an
appropriate and reasonable percentage of the $365 million
purchase price be set aside for payment to unsecured creditors,
the Former Employees assert.
Absent the modifications sought, the Former Employees ask the
Court to deny approval of the Disclosure Statement.
Ms. Kirkley Writes to Court
on Severance Payments
In a letter addressed to the Court, Ms. Kirkley insists that the
94 former employees were left without money to pay bills, feed
their families and seek medical treatment. "This, coupled with
the loss of severance was a truly hardship," she stresses. She
further alleges that a decision on ERC's motion to honor
severance payments cannot be made because the Severance Payments
Motion was never properly filed. Neither ERC, its counsel nor
anyone else will explain why the severance is held up, she points
out.
Accordingly, Ms. Kirkley asks the Court to consider the former
employees' hardship.
The Chapter 11 Plan
Erickson Retirement Communities and its debtor affiliates
presented to the United States Bankruptcy Court for the Northern
District of Texas their Second Amended Joint Plan of
Reorganization and accompanying Disclosure Statement on
February 16, 2010.
The Amended Plan incorporates, among others, settlements between
the Debtors and parties-in-interests in the Debtors' Chapter 11
cases.
The Plan estimate $135,799,000 in total value that will be
available for distribution. Based on the Liquidation Analysis,
the Debtors estimate a 12.9% recovery for ERC and Erickson
Construction LLC under an orderly liquidation and only an 8.2%
recovery for the same Debtor entities under a forced liquidation.
A Liquidation Analysis on the other Debtor Landowners also show
that the Landowners are expected to recover more from an orderly
liquidation than from a forced liquidation.
Full-text copies of the Second Amended Plan and Disclosure
Statement dated February 16, 2010, are available for free at:
http://bankrupt.com/misc/ERC_Feb16AmPlan.pdf
http://bankrupt.com/misc/ERC_Feb16AmDS.pdf
About Erickson Retirement
The Baltimore, Maryland-based Erickson Retirement Communities LLC
owns 20 continuing care retirement communities in 11 states.
Among Erickson's 20 communities, eight are completed, 11 are open
although in construction, and one is in development. They have
23,000 residents in total.
Erickson, along with affiliates, filed for Chapter 11 on Oct. 19,
2009 (Bankr. N.D. Tex. Case No. 09-37010). DLA Piper LLP (US)
serves as counsel to the Debtors. BMC Group Inc. serves as claims
and notice agent. Houlihan, Lokey, Howard & Zoukin, Inc., is also
serving as investment and financial consultant. Alvarez & Marsal
is serving as restructuring adviser.
As of September 30, 2009, on a book value basis, ERC had
approximately $2.7 billion in assets, including $2.2 billion of
property and equipment, and $3.0 billion in liabilities.
Liabilities include $195.8 million on the revolving credit,
$347.5 million on construction credit, $64 million in accounts
payable, $47.8 million in subordinate debt, and $475 million in
purchase option deposits.
Bankruptcy Creditors' Service, Inc., publishes Erickson Retirement
Bankruptcy News. The newsletter tracks the Chapter 11 proceedings
of Erickson Retirement Communities LLC and its debtor-affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
ERICKSON RETIREMENT: NEI Wants Info on Mechanics' Liens
-------------------------------------------------------
Northwest Electric, Inc., tells the Court that upon review of the
Disclosure Statement, it believes the disclosure statement lack
adequate information upon which it may make an informed judgment
regarding Erickson Retirement Communities' Chapter 11 Plan.
Northwest Electric avers that it is a creditor of certain of the
Debtors and holds mechanic's lien claims and general unsecured
claims against Erickson Construction LLC, Concord Campus LLC,
Ashburn Campus LLC and Dallas Campus LLC.
Counsel to Northwest Electric, Aaron M. Kaufmann, Esq., at Cox
Smith Matthews Incorporated, in Dallas, Texas, specifically notes
that the Debtors have not provided adequate information on these
material aspects of the Plan:
(1) The source and amount of payments under the Plan on
account of Mechanic's Lien Claims asserted against
Erickson Construction, Concord Campus and Ashburn Campus;
(2) An explanation of why Mechanic's Lien Claims asserted
against Ashburn Campus and Erickson Construction will be
paid in full, while Mechanic's Lien Claims asserted
against Concord Campus may not;
(3) The meaning of a potentially contradictory provision on
page 45 of the Disclosure Statement (Section V.E.12),
apparently applicable to all campuses, providing that
Allowed Mechanic's Lien Claims will be paid in full;
(4) To the extent Mechanic's Lien Claims are not paid in full,
whether the unpaid portions of the Mechanic's Lien Claims
will be treated as General Unsecured Claims and receive
Tier A Trade Class interest in the Liquidating Creditor
Trust and receive distributions of the Trade Dividend; and
(5) Whether, and on what basis, the underlying liens securing
any unsatisfied Mechanic's Lien Claims can be extinguished
pursuant to Section 363(f) of the Bankruptcy Code.
Northwest Electric thus asks the Court to deny approval of the
Disclosure Statement until the information it seeks are
satisfactorily provided.
The Chapter 11 Plan
Erickson Retirement Communities and its debtor affiliates
presented to the United States Bankruptcy Court for the Northern
District of Texas their Second Amended Joint Plan of
Reorganization and accompanying Disclosure Statement on
February 16, 2010.
The Amended Plan incorporates, among others, settlements between
the Debtors and parties-in-interests in the Debtors' Chapter 11
cases.
The Plan estimate $135,799,000 in total value that will be
available for distribution. Based on the Liquidation Analysis,
the Debtors estimate a 12.9% recovery for ERC and Erickson
Construction LLC under an orderly liquidation and only an 8.2%
recovery for the same Debtor entities under a forced liquidation.
A Liquidation Analysis on the other Debtor Landowners also show
that the Landowners are expected to recover more from an orderly
liquidation than from a forced liquidation.
Full-text copies of the Second Amended Plan and Disclosure
Statement dated February 16, 2010, are available for free at:
http://bankrupt.com/misc/ERC_Feb16AmPlan.pdf
http://bankrupt.com/misc/ERC_Feb16AmDS.pdf
About Erickson Retirement
The Baltimore, Maryland-based Erickson Retirement Communities LLC
owns 20 continuing care retirement communities in 11 states.
Among Erickson's 20 communities, eight are completed, 11 are open
although in construction, and one is in development. They have
23,000 residents in total.
Erickson, along with affiliates, filed for Chapter 11 on Oct. 19,
2009 (Bankr. N.D. Tex. Case No. 09-37010). DLA Piper LLP (US)
serves as counsel to the Debtors. BMC Group Inc. serves as claims
and notice agent. Houlihan, Lokey, Howard & Zoukin, Inc., is also
serving as investment and financial consultant. Alvarez & Marsal
is serving as restructuring adviser.
As of September 30, 2009, on a book value basis, ERC had
approximately $2.7 billion in assets, including $2.2 billion of
property and equipment, and $3.0 billion in liabilities.
Liabilities include $195.8 million on the revolving credit,
$347.5 million on construction credit, $64 million in accounts
payable, $47.8 million in subordinate debt, and $475 million in
purchase option deposits.
Bankruptcy Creditors' Service, Inc., publishes Erickson Retirement
Bankruptcy News. The newsletter tracks the Chapter 11 proceedings
of Erickson Retirement Communities LLC and its debtor-affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
ERICKSON RETIREMENT: To Replace Management Upon Emergence
---------------------------------------------------------
John C. Erickson, founder of Erickson Retirement Communities,
LLC, will step down as chairman of his company after it emerges
from bankruptcy this year, The Baltimore Sun reports.
To resign from their current posts in ERC are Bruce R. "Rick"
Grindrod Jr., chief executive officer; Jeff Jacobson, chief
financial officer; and Tom Brod, executive vice president of
finance, but they will be retained as employees in transitional
roles through the end of the year, The Baltimore Sun notes.
Moreover, Mr. Erickson's sons, Mark Erickson, chief operating
officer, and Scott Erickson, head of information technology for
ERC will resign but will remain as the transitional employees,
the report adds.
ERC spokesperson Mel Tansill spokesperson confirmed to The
Baltimore Sun the leadership changes and said that Redwood
Capital Investments LLC, as ERC's purchaser, will choose the new
management team. The new team will take over once ERC emerges
from Chapter 11 by late March or early April 2010, Mr. Tansill
disclosed to the newspaper.
"As Erickson Retirement Communities moves into a new era, it
makes sense to transition to a new leadership team," the
newspaper quoted Mr. Tansill as saying. The company, however,
will retain the "Erickson" name upon emergence, according to The
Baltimore Sun.
Redwood, which is controlled by Jim Davis, a majority owner of
Allegis Group, outbid a team led by Kohlberg Kravis Roberts & Co.
in a December 22, 2009 auction to acquire substantially all of
ERC's assets. Redwood has committed to pay $365 million for the
ERC assets.
Mr. Davis is expected to head ERC's new management team as
chairman and chief executive officer, The Baltimore Sun notes.
Joining Mr. Davis are Allegis Group executives Alan Butler who
will become chief operating officer and Bill Butz who will serve
as chief financial officer. Five executives from ERC, including
Matt Narrett, executive vice president and chief medical officer,
and Adam Kane, vice president for government and community
affairs will also be part of the new management team, the
newspaper adds.
Under the new management, Mr. John Erickson will become an
adviser to Mr. Davis, The Baltimore Sun relates.
Despite these developments, ERC officials made the assurance that
neither the Chapter 11 filing nor the sale and the subsequent
management changes would affect the retiree residents of the ERC
community or jeopardize their entrance fee deposits, the report
relates.
ERC's sale to Redwood and the corresponding executive management
changes are subject to Bankruptcy Court approval.
FAIRFIELD RESIDENTIAL: Faces $16.9 Million Suit by Nationwide Life
------------------------------------------------------------------
Brian Bandell at South Florida Business Journal relates that
Nationwide Life Insurance Co. of Columbus, Ohio, filed a
$16.9 million foreclosure lawsuit against Fairfield Forest Hill
Garden, 276-unit apartment complex at 6134 Forest Hill Boulevard,
owned by Fairfield Residential.
About Fairfield Residential
San Diego, California-based Fairfield Residential LLC is a fully
integrated multifamily housing company that through its various
subsidiaries provides a diverse mix of services to a wide range of
investors, joint venture partners and clients. FFR either
directly or indirectly acts as a general partner or managing
member of, and owns varying stakes in, a number of project level
operating companies.
The Company and its affiliates -- FF Development, Inc., et al. --
filed for Chapter 11 bankruptcy protection on December 13, 2009
(Bankr. D. Delaware Case No. 09-14378). Daniel J. DeFranceschi,
Esq.; Lee E. Kaufman, Esq.; Paul Noble Heath, Esq.; and Travis A.
McRoberts, Esq., at Richards, Layton & Finger, P.A., assist the
Debtors in their restructuring efforts. The Official Committee of
Unsecured Creditors is represented by Brett H. Miller, Esq.,
Stefan W. Engelhardt, Esq., and Melissa A. Hager, Esq., at
Morrison & Foerster LLP; and William E. Chipman Jr., Esq., Kerri
K. Mumford, Esq., and Kimberly A. Brown, Esq., at Landis Rath &
Cobb LLP. Fairfield Residential listed $100,000,001 to
$500,000,000 in assets and more than $1,000,000,000 in
liabilities. Dow Jones says Fairfield listed assets worth
$958 million and liabilities of nearly $835 million.
FIDDLER'S CREEK: Wants Genovese Joblove as Gen. Bankr. Counsel
--------------------------------------------------------------
Fiddler's Creek, LLC, et al., have asked for permission from the
U.S. Bankruptcy Court for the Middle District of Florida to employ
Paul J. Battista and the law firm of Genovese Joblove & Battista,
P.A., as general bankruptcy counsel, nunc pro tunc to the Petition
Date.
GJB will, among other things:
(a) attend meetings and negotiate with representatives of
creditors and other parties-in-interest and advise and
consult on the conduct of the case, including all of the
legal and administrative requirements of operating in
Chapter 11;
(b) advise the Debtors in connection with any contemplated
sales of assets or business combinations, including the
negotiation of sales promotion, liquidation, stock
purchase, merger or joint venture agreements, formulate
and implement bidding procedures, evaluate competing
offers, draft appropriate corporate documents with
respect to the proposed sales, and counsel the Debtors in
connection with the closing of such sales;
(c) advise the Debtors in connection with post-petition
financing and cash collateral arrangements, provide
advice and counsel with respect to prepetition financing
arrangements, and provide advice to the Debtors in
connection with the emergence financing and capital
structure, and negotiate and draft documents relating
thereto; and
(d) advise the Debtors on matters relating to the evaluation
of the assumption, rejection or assignment of unexpired
leases and executory contracts.
Paul J. Battista, a shareholder of the law firm of GJB, says that
the firm will be paid based on the hourly rates of its personnel:
Paul J. Battista $525
Heather L. Harmon $330
Michael L. Schuster $225
Legal Assistants $75-$160
Mr. Battista assures the Court that GJB is "disinterested" as that
term is defined in Section 101(14) of the Bankruptcy Code.
Fiddler's Creek, LLC, et al., each own, operate and/or are
otherwise affiliated with the premier, fully integrated, master
planned residential community known as "Fiddler's Creek" in
southwestern Florida. Fiddler's Creek is located in Collier
County, Florida, approximately 12 miles southeast of the City of
Naples and six miles north of Marco Island. The Fiddler's Creek
development is comprised of nearly 4,000 zoned acres of prime land
in Naples, Florida, and is planned for and capable of
accommodating up to 6,000 residences upon projected build-out,
which is estimated to be in 2020. Fiddler's Creek contains five
distinctive neighborhoods known as: Fiddler's Creek, Veneta,
Aviamar, Marsh Cove and Meadow Run.
Naples, Florida-based Fiddler's Creek, LLC, filed for Chapter 11
bankruptcy protection on February 23, 2010 (Bankr. M.D. Fla. Case
No. 10-03846). The Company estimated assets and debts at
$100,000,001 to $500,000,000.
FIRESTONE ASSOCIATES: Sec. 341(a) Meeting Scheduled for March 25
----------------------------------------------------------------
The U.S. Trustee for Region 16 will convene a meeting of creditors
in Firestone Associates, LLC's Chapter 11 case on March 25, 2010,
at 2:00 p.m. The meeting will be held at 725 S Figueroa Street,
Room 2610, Los Angeles, CA 90017.
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.
Downey, California-based Firestone Associates, LLC, filed for
Chapter 11 bankruptcy protection on February 23, 2010 (Bankr. C.D.
Calif. Case No. 10-16498). Carolyn A. Dye, Esq., who has an
office in Los Angeles, California, assists the Company in its
restructuring effort. The Company has assets of $7,000,100, and
total debts of $6,924,385.
FONTAINEBLEAU LV: Court Sets Schedule for Contract Litigation
-------------------------------------------------------------
Judge Alan S. Gold of the United States District Court for the
Southern District of Florida has directed the Clerk of Court to
administratively close these cases:
(a) 09-CV-21879-GOLD -- Fontainebleau Las Vegas LLC v. Bank of
America, N.A. et al; and
(b) 09-CV-23835-GOLD -- Avenue CLO Fund, Ltd., et al v. Sumitomo
Mitsui Banking Corporation et al
Judge Gold held that the Closed Cases will now be consolidated
under Multidistrict Litigation Case Number 1:09-md-02106-ASG
entitled as Fontainebleau Las Vegas Contract Litigation.
Judge Gold will remain as the Judge of the Contract Litigation.
The United States Judicial Panel on Multidistrict Litigation has
also issued a Conditional Transfer Order transferring one civil
action to the United States District Court for the Southern
District of Florida for coordinated or consolidated pretrial
proceedings pursuant to Section 1407 of the Judiciary and Judicial
Procedures Code. The civil action entitled as ACP Master, Ltd.,
et al. v. Bank of America, N.A., et al., S.D. New York, C.A. No.
1:09-8064 will be consolidated to Fontainebleau Las Vegas Contract
Litigation.
The Court has issued this time schedule governing the
Fontainebleau Las Vegas Contract Litigation:
Date Action
---- ------
January 15, 2010 Service of Amended Complaints in the
Avenue CLO and Aurelius Actions.
January 22, 2010 The parties will exchange the
information required by Fed. R. Civ.
P. 26(a)(1).
January 29, 2010 Initial Requests for Production and
Interrogatories to be exchanged. The
parties may serve subpoenas on
nonparties at this time.
February 18, 2010 Service of Defendants' Answers to or
Motions under Fed. R. Civ. P. 12(b)
regarding the Amended Complaints in
the Avenue CLO and Aurelius Actions.
March 1, 2010 Written responses to initial Requests
for Production and Interrogatories to
be served. Any related document
productions to commence on a rolling
basis.
March 22, 2010 Service of Avenue CLO Action or
Aurelius Action Plaintiffs'
Oppositions to any Motions under Fed.
R. Civ. P. 12(b).
April 5, 2010 Service of Defendants' Replies to any
Motions under Fed. R. Civ. P. 12(b).
May 13, 2010 at Oral argument on any Motions to
3:15 p.m. Dismiss.
May 13, 2010 Document productions in response to
initial Requests for Production to be
completed.
July 1, 2010 Commencement of fact depositions.
September 15, 2010 All non-dispositive, non-discovery
related pretrial motions will be
filed. Any motion to amend or
supplement the pleadings filed
pursuant to Fed. R.Civ. P. 15(a) or
15(d) will comport with S.D. Fla. L.R.
15.1 and will be accompanied by the
proposed amended or supplemental
pleading and a proposed order as
required.
September 30, 2010 Plaintiffs will furnish opposing
counsel with a written list containing
the names and addresses of all expert
witnesses intended to be called at
trial and only those expert witnesses
so listed will be permitted to
testify.
November 1, 2010 Defendants will furnish opposing
counsel with a written list containing
the names and addresses of all expert
witnesses intended to be called at
trial and only those expert witnesses
so listed will be permitted to
testify.
January 31, 2011 Final date to exchange written
discovery demands.
April 15, 2011 Conclusion of fact discovery.
May 2, 2011 The parties will comply with S.D. Fla.
L.R. 16.1(K) concerning the exchange
of expert witness summaries and
reports. This date will supersede any
other date in Local Rule 16.1(K).
June 1, 2011 Rebuttal expert reports will be filed.
July 15, 2011 All expert discovery, including
depositions, will be completed.
July 29, 2011 All dispositive pretrial motions,
including motions to strike in whole
or in part expert testimony, and
memoranda of law must be filed.
August 30, 2011 Opposition to any dispositive motions
to be filed.
September 15, 2011 Replies, if any, to dispositive
motions to be filed.
November 18, 2010 Oral argument will be heard on any
at 9:00 a.m. motions for summary judgment that may
be filed.
December 13, 2011 Pretrial Stipulation and Motions in
Limine. The joint pretrial
stipulation will be filed pursuant to
Local Rule 16.1(E) of the U.S.
District Court for the Southern of
Florida. In conjunction with the
Joint Pretrial Stipulation, the
parties will file their motions in
limine.
MB Financial Bank, N.A., sought and obtained from the Court an
order substituting the law firm of Astigarraga Davis Mullins &
Grossman, P.A., as local counsel of record for MB Financial Bank,
N.A., and relieving the law firm of Furr and Cohen, P.A., of any
further responsibility for the defense of MB Financial Bank.
District Court Denies Motion for Leave to
Appeal Interlocutory Orders
Judge Gold has denied Fontainebleau's Motion for Leave to Appeal
Interlocutory Orders Withdrawing the Reference and Denying Summary
Judgment.
Judge Gold reasoned, among others, that Fontainebleau's
Certification Motion is untimely. Judge Gold pointed out that
even if he were to conclude that the three requirements of Section
1292(b) are satisfied in the instant case, Fontainebleau's request
for certification would still be denied as untimely.
Judge Gold added that despite the fact that Section 1292(b) does
not contain an express time-limit for seeking certification, it is
well-settled that a "district judge should not grant an
inexcusably dilatory request" to take an interlocutory appeal.
Prior to the Court's entry of the Oder, the Term Lenders asked the
District Court to deny the Motion, without prejudice.
According to the Term Lenders, if the Motion is granted at this
time, before the District Court has an opportunity to hear from
the Term Lenders on the rulings to be appealed, the ultimate
termination of the multidistrict litigation will not be materially
advanced. All of the parties in the Multidistrict Litigation,
including Fontainebleau, agreed that centralization is appropriate
because the cases raise related and overlapping legal and factual
issues. The Term Lenders said they have not been heard on any
issues raised in Fontainebleau's motion for partial summary
judgment including the proper interpretation of the phrase "fully
drawn."
Fontainebleau replied that the central premise of the Term
Lenders' argument -- that they "have not yet been heard on any
issues raised in Fontainebleau's motion for partial summary
judgment" -- is demonstrably false. According to Fontainebleau,
the Term Lenders fail to mention that they previously filed a
brief as amicus curiae in support of Fontainebleau's motion for
partial summary judgment motion.
Avenue CLO Files Second Amended Complaint
Avenue CLO Fund, Ltd., et al., each of which is a lender under a
June 6, 2007 Credit Agreement, filed an amended complaint under
the Fontainebleau Las Vegas Contract Litigation against Bank of
America N.A, in its capacity as Administrative Agent under a
Credit Agreement and as Disbursement Agent under a related
Master Disbursement Agreement, and against Merrill Lynch Capital
Corporation, J.P. Morgan Chase Bank, N.A., Barclays Bank PLC,
Deutsche Bank Trust Company Americas, The Royal Bank of Scotland
PLC, Sumitomo Mitsui Banking Corporation, Bank of Scotland, HSH
Nordbank AG, MB Financial Bank, N.A., and Camulos Master Fund,
L.P., in their capacities as lenders under the Credit Agreement.
On June 6, 2007, the Credit Agreement was entered into among
numerous lenders, including Avenue CLO Fund, Ltd., et al., and
Bank of America, N.A., et al., and Fontainebleau Las Vegas, LLC
and Fontainebleau Las Vegas II, LLC, the Borrower. BofA and its
counsel served as the principal architects of the Credit Agreement
and related Loan Documents, including the Disbursement Agreement.
The Credit Agreement included commitments for three kinds of
loans: (a) a $700 million initial term loan facility; (b) a $350
million delay draw term facility; and (c) $800 million revolving
loan facility.
A dispute has arisen between Avenue, et al., and the Lenders
regarding the Lenders rights and obligations under the Credit
Agreement. Avenue, et al., contend that the Lenders have breached
the agreement by failing to fund and by terminating their loan
commitments under a Revolving Facility.
In addition, a dispute has arisen between Avenue, et al., and BofA
regarding BofA's obligations to Avenue, et al., as intended third-
party beneficiaries under the Disbursement Agreement. Avenue, et
al., contend that BofA has breached that agreement by approving an
advance requests and by failing to issue a Stop Funding Notice.
David A. Rothstein, Esq., at Dimond Kaplan & Rothstein, P.A., in
Miami, Florida, pointed out that if not all of the conditions
precedent to an Advance were satisfied, or if the Administrative
Agent notified the Disbursement Agent that a Default or Event of
Default had occurred, then the Disbursement Agent was required to
provide a Stop Funding Notice to the Borrowers and each Funding
Agent, including the Administrative Agent.
Mr. Rothstein asserts that BofA materially breached its duties
under the Disbursement Agreement by improperly approving Advance
Requests that failed to meet one or more of the conditions
precedent under Section 3.3 of the Disbursement Agreement,
improperly issuing certain advance confirmation notices,
improperly failing to issue Stop Funding Notices as a result of
the failure of conditions precedent to certain Advance Requests
and Defaults, and improperly disbursing funds from the Bank
Proceeds Account pursuant to the deficient Advance Requests.
In breaching its duties under the Disbursement Agreement, Mr.
Rothstein argues that BofA's actions constituted bad faith, gross
negligence and willful misconduct, and favored its own interests
over those of the Term Lenders.
Accordingly, Avenue, et al., ask the District Court to declare
that the Lenders and BofA have breached their contractual duties
under the Credit Agreement and Disbursement Agreement thus
entitling Avenue, et al., to damages in an amount subject to proof
at trial.
A full-text copy of the Amended Complaint is available for free
at http://bankrupt.com/misc/CLO_AmendedComplaint.pdf
About Fontainebleau Las Vegas
Fontainebleau Las Vegas -- http://www.fontainebleau.com/-- is
constructing a luxury resort, Fontainebleu Las Vegas, on the
northern end of the Las Vegas Strip.
Fontainebleau Las Vegas Holdings, LLC, Fontainebleau Las Vegas,
LLC, Fontainebleau Las Vegas Capital Corp. filed for Chapter 11
protection on June 9, 2009 (Bankr. S.D. Fla. Lead Case No.
09-21481). Judge A. Jay Cristol presides over the Debtors' cases.
Scott L Baena, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP,
represents the Debtors in their restructuring efforts. The
Debtors' Financial Advisor are Moelis & Company LLC and Citadel
Derivatives Group LLC. The Debtors' Special Litigation Counsel is
David M. Friedman, Esq., at Kasowitz, Benson, Torres & Friedman
LLP and the Debtors' Special Counsel is Jack J. Kessler, Esq., and
Alan Rubin, Esq., at Buchanan Ingersoll & Rooney PC. The Debtors'
Claims Agent is Kurtzman Carson Consulting LLC. Attorneys at
Genovese Joblove & Battista, P.A., and Fox Rothschild, LLP,
represent the Official Committee of Unsecured Creditors.
As of June 9, 2009, Fontainebleau Las Vegas LLC listed more than
$1 billion in debt and a similar amount in assets, while each of
Fontainebleau Las Vegas Capital Corp. and Fontainebleau Las Vegas
Holdings, LLC, listed less than $50,000 in assets and more than
$1 billion in debts.
Bankruptcy Creditors' Service, Inc., publishes Fontainebleau
Bankruptcy News. The newsletter tracks the Chapter 11 proceedings
of Fontainebleau Las Vegas Holdings, LLC, and its debtor-
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
FONTAINEBLEAU LV: Examiner Files 11th & 12th Reports
----------------------------------------------------
Jeffrey R. Truitt, the appointed Chapter 11 Examiner in
Fontainebleau Las Vegas' Chapter 11 cases, delivered to the Court
on February 2 and 11, 2010, his Tenth, Eleventh and Twelfth
Examiner's Report covering the period from January 19, 2010,
through February 21, 2010.
The Examiner related that during the Tenth Period, the Debtors and
Icahn have been working to close the sale transaction, which is
set to close before February 18, 2010, the "Outside Date" as
defined in the amended Asset Purchase Agreement.
The Examiner previously reviewed letters from two parties to
contracts with the Debtors, W.L. Griffin, Inc. doing business as
Griffin Contemporary, and Young Electric Sign Company with
questions and requests for clarification regarding the Asset
Purchase Agreement and the sale. During the Tenth Period, the
Examiner says he continued discussions with the Debtors and the
Contract Parties regarding the letters, which resulted in a
resolution of the disputes between the Debtors and Contract
Parties as reflected in the Sale Order.
In his Eleventh Report, the Examiner mentioned that certain
counter-contract parties filed objections to the cure costs for
the assumption and assignment of their contracts to Icahn. Icahn
and the counter-contract parties have reached agreement that these
contracts will not be assumed. After the Debtors file an amended
notice of assigned contracts, the counter-contract parties will
withdraw their objections.
In his Twelfth Report, the Examiner noted that now that the sale
transaction has closed and in order to avoid incurring additional
costs for the estates, he will cease preparing and filing the
status reports every 10 days, unless the Court orders otherwise.
In the event material issues related to the Examiner's duties
arise in the future, the Examiner will file status reports with
respect thereto with the Court.
About Fontainebleau Las Vegas
Fontainebleau Las Vegas -- http://www.fontainebleau.com/-- is
constructing a luxury resort, Fontainebleu Las Vegas, on the
northern end of the Las Vegas Strip.
Fontainebleau Las Vegas Holdings, LLC, Fontainebleau Las Vegas,
LLC, Fontainebleau Las Vegas Capital Corp. filed for Chapter 11
protection on June 9, 2009 (Bankr. S.D. Fla. Lead Case No.
09-21481). Judge A. Jay Cristol presides over the Debtors' cases.
Scott L Baena, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP,
represents the Debtors in their restructuring efforts. The
Debtors' Financial Advisor are Moelis & Company LLC and Citadel
Derivatives Group LLC. The Debtors' Special Litigation Counsel is
David M. Friedman, Esq., at Kasowitz, Benson, Torres & Friedman
LLP and the Debtors' Special Counsel is Jack J. Kessler, Esq., and
Alan Rubin, Esq., at Buchanan Ingersoll & Rooney PC. The Debtors'
Claims Agent is Kurtzman Carson Consulting LLC. Attorneys at
Genovese Joblove & Battista, P.A., and Fox Rothschild, LLP,
represent the Official Committee of Unsecured Creditors.
As of June 9, 2009, Fontainebleau Las Vegas LLC listed more than
$1 billion in debt and a similar amount in assets, while each of
Fontainebleau Las Vegas Capital Corp. and Fontainebleau Las Vegas
Holdings, LLC, listed less than $50,000 in assets and more than
$1 billion in debts.
Bankruptcy Creditors' Service, Inc., publishes Fontainebleau
Bankruptcy News. The newsletter tracks the Chapter 11 proceedings
of Fontainebleau Las Vegas Holdings, LLC, and its debtor-
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
FUNERAL HOMES OF TEXAS: Voluntary Chapter 11 Case Summary
---------------------------------------------------------
Debtor: Funeral Homes of Texas, Inc.
419 Present Street
Missouri City, TX 77489
Bankruptcy Case No.: 10-31806
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Southern District of Texas (Houston)
Judge: Letitia Z. Paul
Debtor's Counsel: Frederick Lloyd McGuire, Esq.
Law Office of Frederick L McGuire
17101 Kuykendahl #220
Houston, TX 77068
Tel: (281) 397-8151
Fax: (281) 397-6298
Email: colleen.mcclure@att.net
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor did not file a list of its 20 largest unsecured
creditors when it filed its petition.
The petition was signed by Margaret Broadnax, president of the
Company.
G&S CRENSHAW: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: G&S Crenshaw, LLC
dba JP Ranch
9908 Marthas Vineyard Cir
Providence Village, TX 76227
Bankruptcy Case No.: 10-10535
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Western District of Louisiana (Shreveport)
Debtor's Counsel: John W. Luster, Esq.
P.O. Box 488
Natchitoches, LA 71458-0488
Tel: (318) 352-3602
Email: luster_j@bellsouth.net
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $500,001 to $1,000,000
According to the schedules, the Company has assets of $1,637,056,
and total debts of $861,897.
A full-text copy of the Debtor's petition, including a list of its
20 largest unsecured creditors, is available for free at:
http://bankrupt.com/misc/lawb10-10535.pdf
The petition was signed by Greg Crenshaw, member/manager the
Company.
GENERAL GROWTH: Gets Shorther 4-Month Exclusivity Extension
-----------------------------------------------------------
U.S. Judge Allan Gropper of the U.S. Bankruptcy Court for the
Southern District of New York stretched General Growth Properties
Inc.'s exclusive periods to propose and solicit acceptances of a
plan of reorganization for another four months.
General Growth requested a six-month extension. The Troubled
Company Reporter on February 5, 2010, said General Growth asked
the Court to extend their exclusive periods to:
(i) file a Chapter 11 plan to August 26, 2010; and
(ii) solicit acceptances to that plan on October 26, 2010.
Simon Property Group and the official committee of unsecured
creditors asked that any extension to be under 45 days.
In response to the Court's ruling, Simon Property said, "We
appreciate the Court's decision to shorten the exclusivity period
requested by General Growth. The Court has made it abundantly
clear that General Growth must now conduct a truly fair process
with all parties on a level playing field. We have been permitted
to commence due diligence, and we will determine our best course
of action as we move forward."
The Wall Street Journal's Kris Hudson notes that if Judge Gropper
deems General Growth's progress insufficient and allows the
exclusivity period to expire, creditors and outside parties can
also propose buyouts or restructuring plans.
According to the Journal, Judge Gropper said General Growth has
done a "superb" job considering the interests of all of its
creditors and shareholders. Judge Gropper wants General Growth to
move quickly so that it doesn't "miss the market" to get full
recovery for its creditors. "The playing field will not be
tilted" against bidders, the judge said, according to the Journal.
"Entities willing to make a proposal to finance or acquire the
debtor will have that opportunity."
The Journal also reports that Tom Nolan, General Growth's
president and chief operating officer, said during the hearing
that "four or five" companies so far have signed nondisclosure
agreements to examine confidential data about General Growth's
malls as they consider whether to make bids for all or part of the
company. Among those that are doing so are Simon, Brookfield and
Australian mall owner Westfield Group.
"We're anxious to present the new (General Growth) and its
business plan to potential investors so we can get the highest and
best outcome for all stakeholders in this case," Mr. Nolan said,
the Journal reports.
As reported by General Growth Bankruptcy News and the Troubled
Company Reporter, Simon has offered to buy General Growth in its
entirety for $10 billion. However, on February 24, General Growth
unveiled an agreement in principle with Brookfield Asset
Management Inc., to invest in a proposed recapitalization of GGP.
The General Growth-Brookfield plan values General Growth at $15 a
share and the Simon offer at $9 a share.
Last week, Simon said its all-cash bid was superior to the
Brookfield plan because it provided $10 billion "of real value
. . . as compared to a complex piece of financial engineering that
is so highly conditional as to be illusory."
Simon's offer would provide a 100% cash recovery of par value plus
accrued interest and dividends to all General Growth unsecured
creditors, the holders of its trust preferred securities, the
lenders under its credit facility, the holders of its Exchangeable
Senior Notes and the holders of Rouse bonds, immediately upon the
effectiveness of a definitive transaction agreement. This
consideration to creditors totals approximately $7 billion.
The $2.625 billion equity commitment from Brookfield is not
subject to due diligence or any financing condition and is
expected to create a floor value for the purpose of raising
additional equity for the company. Under the terms of the
proposed plan:
* GGP's existing shareholders will receive one share of new
GGP common stock with an initial value of $10.00 per share,
plus one share of General Growth Opportunities with an
initial value of $5.00 per share, for total consideration
of $15.00 per share
* Unsecured creditors will receive par plus accrued interest
* Brookfield will invest $2.5 billion at $10.00 per share for
new GGP common stock and up to $125 million at $5.00 per
share for GGO common stock
In an earlier report, the Journal said General Growth continues to
solicit buyout proposals and recapitalization offers. According
to the Journal, General Growth, in a court filing on Monday, said
bids are due May 18. It will then negotiate with bidders until
June 22.
Lazard Ltd., J.P. Morgan and Morgan Stanley are acting as
financial advisors to Simon and Wachtell, Lipton, Rosen & Katz is
serving as legal advisor.
Goldman Sachs & Co. and Barclays Capital served as financial
advisors to Brookfield, and Willkie Farr & Gallagher LLP acted as
legal counsel to Brookfield.
About General Growth Properties
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: Vice Chairman Lutz to Retire Effective May 1
------------------------------------------------------------
General Motors Vice Chairman Robert A. Lutz will retire effective
May 1, 2010, capping a 47-year career in the global auto industry
that included senior leadership positions at four of the world's
leading automakers.
Mr. Lutz, 78, rejoined GM September 1, 2001, as the head of
product development, and has led the company's resurgence in
developing great cars and trucks. He also worked at BMW, Chrysler
and Ford.
"The influence Bob Lutz has had on GM's commitment to design,
build and sell the world's best vehicles will last for years to
come," GM CEO and Chairman Ed Whitacre said. "I, along with many
other men and women in GM and throughout the industry, have
greatly benefited from his passion, wisdom and guidance."
Mr. Lutz said he decided to retire now in part because hot-selling
vehicles like the Buick LaCrosse, Cadillac SRX, GMC Terrain,
Chevrolet Equinox and Chevrolet Camaro, along with the growing
strength of GM's four brands, prove that a product-focused mindset
inside the company is in place for the long term.
"I can confidently say that the job I came here to do more than
nine years ago is now complete -- the team I have been fortunate
to lead has far exceeded my expectations," Mr. Lutz said. "Our
product lineup is as strong as it has been in GM's history. The
perception of our products and brands is beginning to catch up
with reality. And most importantly, the absolute commitment to
being a product-driven company is ingrained throughout the
organization -- from the top down -- and I am confident that,
under Ed Whitacre's leadership, the straightforward, singular
focus on product will endure."
Mr. Lutz, a GM vice chairman, was appointed senior advisor in
December 2009 and will continue to provide guidance on design and
key product initiatives until he retires May 1.
About General Motors
General Motors Company -- http://www.gm.com/-- is one of the
world's largest automakers, tracing its roots back to 1908. With
its global headquarters in Detroit, GM employs 209,000 people in
every major region of the world and does business in some 140
countries. GM and its strategic partners produce cars and trucks
in 34 countries, and sell and service these vehicles through these
brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, Opel,
Vauxhall and Wuling. GM's largest national market is the United
States, followed by China, Brazil, the United Kingdom, Canada,
Russia and Germany. GM's OnStar subsidiary is the industry leader
in vehicle safety, security and information services.
GM acquired its operations from General Motors Company, n/k/a
Motors Liquidation Company, on July 10, 2009, pursuant to a sale
under Section 363 of the Bankruptcy Code. Motors Liquidation or
Old GM is the subject of a pending Chapter 11 reorganization case
before the U.S. Bankruptcy Court for the Southern District of New
York.
At September 30, 2009, GM had US$107.45 billion in total assets
against US$135.60 billion in total liabilities.
About Motors Liquidation
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)
GENERAL MOTORS: Appoints Selim Bingol As VP for Communications
--------------------------------------------------------------
Selim Bingol has been appointed General Motors vice president of
communications, effective March 8. Mr. Bingol, 49, will report to
Ed Whitacre, chairman and CEO.
"Selim brings a wealth of experience to this position and his deep
and diverse background will serve us well as we accelerate our
efforts to design, build and sell the world's best vehicles," said
Whitacre. "I have worked with Selim over the years on several
complex communication issues and he has my trust and respect."
Mr. Bingol will have overall responsibility for GM's global
communications, including global products and brands, corporate,
public policy, executive support, and internal communications.
"I have been fortunate to have great assignments and work with
talented professionals throughout my career," said Mr. Bingol. "I
am excited to be part of a team that is taking GM to new heights."
Mr. Bingol has deep experience in all facets of communications.
He was most recently senior vice president and senior partner with
Fleishman-Hillard, where he specialized as a senior communications
strategist to large international clients across diverse
industries.
Prior to being senior partner of Fleishman-Hillard, Mr. Bingol was
senior vice president of corporate communications for AT&T. He
was responsible for leading the public relations organization for
AT&T through one of the most dynamic periods in its history,
including nearly $200 billion in mergers and acquisitions. Prior
to joining AT&T in 2004, he was vice president of SBC
Communications.
Mr. Bingol succeeds Chris Preuss, who was appointed vice president
and president, OnStar, to lead the company's global infotainment
and connectivity initiatives.
About General Motors
General Motors Company -- http://www.gm.com/-- is one of the
world's largest automakers, tracing its roots back to 1908. With
its global headquarters in Detroit, GM employs 209,000 people in
every major region of the world and does business in some 140
countries. GM and its strategic partners produce cars and trucks
in 34 countries, and sell and service these vehicles through these
brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, Opel,
Vauxhall and Wuling. GM's largest national market is the United
States, followed by China, Brazil, the United Kingdom, Canada,
Russia and Germany. GM's OnStar subsidiary is the industry leader
in vehicle safety, security and information services.
GM acquired its operations from General Motors Company, n/k/a
Motors Liquidation Company, on July 10, 2009, pursuant to a sale
under Section 363 of the Bankruptcy Code. Motors Liquidation or
Old GM is the subject of a pending Chapter 11 reorganization case
before the U.S. Bankruptcy Court for the Southern District of New
York.
At September 30, 2009, GM had US$107.45 billion in total assets
against US$135.60 billion in total liabilities.
About Motors Liquidation
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)
GENERAL VISION: Management Committee Lawsuit Dismissed
------------------------------------------------------
WestLaw reports that New York's six-year statute of limitations
for derivative actions against directors did not extend to breach
of fiduciary duty claims asserted, not against directors of a
corporate Chapter 7 debtor, but against members of a management
committee charged with overseeing acts of the debtor's board of
directors until a reorganization plan was confirmed, who were not
themselves directors of the debtor. Under New York law, in order
for a breach of fiduciary duty claim seeking money damages to be
subject to this six-year limitations period, the defendant must be
a de jure, and not just a de facto, director of the corporation.
In re General Vision Services, Inc., --- B.R. ----, 2010 WL 571979
(S.D.N.Y.).
Ned Steinfeld, serving as the Representative of the Estate of
General Vision Services, sued (Bankr. S.D.N.Y. Adv. Pro. No. 05-
01759) Richard A. Eisner & Company, LLC, Ralph Balsamo, and Shelby
Goldgrab, who served on a management committee that oversaw
certain aspects of the debtor's operations, for their alleged
negligence and breach of fiduciary duty. The Honorable Stuart M.
Bernstein, 2006 WL 687162, granted the defendants' motion to
dismiss on limitations grounds. The plaintiff moved for
reargument, 352 B.R. 25, and then-Chief Judge Bernstein, again
said the statute of limitation bars prosecution of the action.
Mr. Steinfeld, in turn, appealed to the U.S. District Court for
the Southern District of New York. In the District Court, the
Honorable George B. Daniels affirmed the Bankruptcy Court's
decision.
General Vision Services, Inc., ran a chain of optical stores that
provided optometry services and sold eye wear. On April 16, 1999,
several bondholders filed an involuntary bankruptcy petition
(Bankr. S.D.N.Y. Case No. 99-10105) for relief under chapter 11
against GVS and an affiliate, Action Industries. The bondholders
subsequently moved for the appointment of an interim trustee.
That motion and the involuntary petition were resolved through a
stipulation that was so-ordered by the Bankruptcy Court on
September 10, 1999. As stipulated, the motion for the appointment
of a trustee was withdrawn, and a Management Committee was created
to manage and review the operations of GVS until a plan of
reorganization was confirmed and became effective, or upon further
order of the Bankruptcy Court. The named members of the
Management Committee were GVS's Chief Executive Officer, Shelby
Goldgrab, and Ralph Balsamo. Mr. Balsamo, was a member of Richard
E. Eisner & Company, LLC, an accounting firm. On March 13, 2001,
the Court entered an order converting GVS' chapter 11 case to a
Chapter 7 liquidation proceeding.
GLENN MARC GALLANT: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Glenn Marc Gallant
5596 Bayview Dr
Ft. Lauderdale, FL 33308
Bankruptcy Case No.: 10-15132
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Southern District of Florida (Fort Lauderdale)
Judge: Raymond B. Ray
Debtor's Counsel: Zach B. Shelomith, Esq.
2699 Stirling Rd # C401
Ft Lauderdale, FL 33312
Tel: (954) 920-5355
Fax: (954) 920-5371
Email: zshelomith@lslawfirm.net
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including a list of its
20 largest unsecured creditors, is available for free at:
http://bankrupt.com/misc/flsb10-15132.pdf
The petition was signed by Glenn Marc Gallant.
GOLDBERG-BAYMEADOWS: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------------
Debtor: Goldberg-Baymeadows, LLC
53 Cornell Drive
Rancho Mirage, CA 92270
Bankruptcy Case No.: 10-01637
Chapter 11 Petition Date: March 2, 2010
Court: United States Bankruptcy Court
Middle District of Florida (Jacksonville)
Debtor's Counsel: Jason B. Burnett, Esq.
GrayRobinson, P.A.
50 N. Laura Street, Suite 1100
Jacksonville, FL 32202
Tel: (904) 598-9929
Email: jburnett@gray-robinson.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $1,000,001 to $10,000,000
The petition was signed by Robert B. Goldberg.
Debtor's List of 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
A1 Orange Cleaning Window cleaning Unknown
Service
PO Box 555704
Orlando, FL 32855
Advanced Wiring Services Lighting replacement Unknown
2800 Almeda Street
Jacksonville, FL 32209
Aquatic System, Inc. Pond maintenance Unknown
2100 NW 33rd Street
Pompano Beach, FL 33069
AT&T Phone, security Unknown
PO Box 105262 system, and fire
Atlanta, GA 30348 alarm monitoring
Black Gold Asphalt, Inc. Asphalt repair Unknown
PO Box 47316
Jacksonville, FL 32247
C.S.S. Landscaping, Inc. Landscape and Unknown
PO Box 57552 irrigation services
Jacksonville, FL 32241
Colliers Dickinson Leasing Agent Unknown
One Independent Division
24th Floor
Jacksonville, FL 32202
Colliers International Property Management Unknown
331 Park Place Blvd.
Suite 600
Clearwater, FL 33759
Ferber Roofing, Inc. Roof repair/ $14,000
replacement
JEA Utility service $22,890
Lamp Sales Unlimited, Light bulbs/lamps Unknown
Inc.
PO Box 10606
Jacksonville, FL 32247
Luce Forward, Attorneys Legal services $28,119
McKendree's Plumbing Plumbing maintenance/ $5,704
& Heating repair
Metro Property Services $4,000
North American Clean Day porter Unknown
Sweeps
911 Shade Tree Lane
Knoxville, TN 37922
Pest Express Pest control services $3,900
Philadelphia Insurance Property Insurance Unknown
Cos.
PO Box 70251
Philadelphia, PA 19176
Stripe Rite Pavement Pavement Painting Unknown
Marking
PO Box 57822
Jacksonville, FL 32241
Total Comfort Solutions Unknown
3545-1 St. Johns Bluff
Road
Jacksonville, FL 32224
Walter Dickinson Leasing commissions Unknown
1 Independent Drive
Suite 2401
Jacksonville, FL 32202
GTC BIOTHERAPEUTICS: Inks Note Purchase Agreement with LFB Biotech
------------------------------------------------------------------
GTC Biotherapeutics Inc. entered into a Note Purchase Agreement
with LFB Biotechnologies S.A.S. under which LFB agreed to purchase
from the company a $7,000,000 secured note. Issuance and sale of
the secured note was subject to the satisfaction of certain
conditions, including the accuracy of the representations and
warranties of the parties and the satisfaction of other customary
closing conditions.
On Feb. 24, 2010, upon the satisfaction of those conditions, the
company issued and sold the secured note to LFB upon receipt of
the $7,000,000 in cash.
Secured Note
The secured note has a 36-month term and accrues interest at a
rate of 4%, with a single payment of principal and interest at
maturity. After Jan. 1, 2011, LFB may annually adjust the rate of
interest upwards or downwards, based on LFB's then-current cost of
capital, as determined by LFB in the exercise of its commercially
reasonable discretion. Over the term of the secured note LFB may
elect to participate in any of the company's future equity
financing transactions by cancelling all or any portion of the
principal and interest outstanding under the secured note for any
shares of the company's common stock or securities convertible,
exercisable or exchangeable into shares of our common stock that
the company issue and sell in the financing.
Amendments to Existing Loan Agreements
On Feb. 24, 2010, the company also entered into a Third Amendment
to our Amended and Restated Security Agreement with LFB, dated
June 18, 2009 and a Third Amendment to our Mortgage, Security
Agreement and Fixture Filing dated as of Dec. 22, 2008. The
purpose of these amendments was to modify our existing security
arrangements with LFB to add the secured note to the company's
debt that is secured by a first priority security interest on all
of the company's assets, including our intellectual property, but
excluding livestock.
A full-text copy of the company's $7,000,000 Secured Note is
available for free at:
http://ResearchArchives.com/t/s?5625
A full-text copy of the Note Purchase Agreement is available for
free at"
http://ResearchArchives.com/t/s?5626
A full-text copy of the Third Amendment to the Amended and
Restated Security Agreement is available for free at:
http://ResearchArchives.com/t/s?5627
A full-text copy of the Third Amendment to Mortgage Agreement and
Fixture Filing is available for free at:
http://ResearchArchives.com/t/s?5628
Going Concern
GTC said its recurring losses from operations and limited funds
raise substantial doubt about its ability to continue as a going
concern. As of September 27, 2009, the Company had $23.4 million
in total assets against $63.1 million in total liabilities, and
($10.4) million in total redeemable convertible preferred stock,
resulting in $29.2 million in stockholders' deficit.
On November 2, 2009, the Company entered into a Stock Purchase
Agreement with LFB Biotechnologies S.A.S., its principal
stockholder, under which the Company agreed to issue to LFB
$3.625 million in shares of the Company's common stock at a sales
price of $1.07, which is equal to the closing price of the common
stock on the Nasdaq Capital Market on October 30.
On October 31, 2009, LFB notified the Company that it was
exercising its option to purchase the $12.75 million of additional
shares of Series E convertible preferred stock under the terms
described in the financing agreements approved by the Company's
shareholders in July 2009. This transaction provided the Company
with roughly $6.38 million of new cash proceeds. In addition, LFB
converted its existing shares of Series E convertible preferred
stock it previously purchased in July into a total of roughly
10.6 million shares of common stock.
Management expects that future sources of funding will include
sales of equity or debt securities and new or expanded partnering
arrangements. The Company said if no funds are available it would
have to sell or liquidate the business.
Based on its cash balance as of September 27, 2009, as well as the
$10 million in cash it received from the closing of the LFB
financing transactions and potential cash receipts from existing
programs -- the Company anticipates it has the ability to continue
its operations into the middle of the first quarter of 2010,
including normal recurring debt service payments.
The Company is engaged in discussions for potential new partnering
transactions and plan to bring further financial resources into
GTC in the future through some combination of partnering
transactions and other debt or equity financing arrangements.
About GTC Biotherapeutics
Headquartered in Framingham, Massachusetts, GTC Biotherapeutics,
Inc. (NASDAQ: GTCB) -- http://www.gtc-bio.com/-- develops,
supplies, and commercializes therapeutic proteins produced through
transgenic animal technology. The Company is also developing a
portfolio of recombinant human plasma proteins with known
therapeutic properties. The company also has a monoclonal
antibody portfolio focused on follow-on biologics, including a
CD20 monoclonal antibody. The intellectual property of the
company includes a patent in the United States through 2021 for
the production of any therapeutic protein in the milk of any
transgenic mammal. Its transgenic production platform is
particularly well suited to enabling cost effective development of
proteins that are difficult to express in traditional recombinant
production systems as well as proteins that are required in large
volumes.
GUIDED THERAPEUTICS: Stockholders Approves Cert. of Incorporation
-----------------------------------------------------------------
Guided Therapeutics Inc.'s stockholders approved the proposal to
amend the company certificate of incorporation to reclassify the
company's series A convertible preferred stock into common stock
and warrants to purchase shares of common stock.
A full-text copy of the company's certificate of incorporation is
available for free at http://ResearchArchives.com/t/s?562b
About Guided Therapeutics
Norcross, Georgia-based Guided Therapeutics, Inc. (Pink Sheets:
GTHP) is a medical technology company focused on developing
innovative medical devices that have the potential to improve
health care. The Company is currently focused on completing the
development of cervical cancer detection device.
* * *
At September 30, 2009, the Company had $1,385,000 in total assets
against $12,694,000 in total liabilities, resulting in $11,309,000
in capital deficit.
HAWAIIAN TELCOM: Kirkland Charges $2.6MM for Oct.-Dec. Work
-----------------------------------------------------------
Pursuant to Sections 330 and 331 of the Bankruptcy Code, seven
professionals retained in Hawaiian Telcom Communications, Inc.'s
Chapter 11 cases filed with the Court their fourth interim fee
applications for the fee period from October 1, 2009 through
December 31, 2009:
Firm Fees Expenses
---- ---------- --------
Ernst & Young LLP $239,504 $681
Deloitte & Touche LLP 265,359 0
Cades Schutte LLP 274,883 26,903
Morrison & Foerster LLP 1,674,431 181,926
Moseley Biehl Tsugawa Lau & Muzzi 123,684 14,848
Kirkland & Ellis LLP 2,613,584 242,751
Lazard Freres & Co. LLC 2,000,000 135,100
Moseley Biehl also asks the Court to direct the Debtors to pay it
$33,885 for unpaid fees. Cades Schutte seeks payment of $14,111
for general excise tax for the State of Hawaii. Moreover,
Deloitte's fees include Hawaiian excise taxes totaling $11,467
due for the relevant period.
Kirkland & Ellis is the Debtors' lead counsel. Cades Schutte is
the Debtors' co-counsel. Ernst & Young serves as tax advisor to
the Debtors. Lazard Freres is financial advisor to the Debtors.
Deloitte & Touche acts as the Debtors' auditor.
Morrison & Foerster acts as lead counsel to the Official
Committee of Unsecured Creditors while Moseley Biehl serves as
the Committee's co-counsel.
About Hawaiian Telcom
Based in Honolulu, Hawaii, Hawaiian Telcom Communications, Inc.
-- http://www.hawaiiantel.com/-- operates a telecommunications
company, which offers an array of telecommunications products and
services including local and long distance service, high-speed
Internet, wireless services, and print directory and Internet
directory services.
The Company and seven of its affiliates filed for Chapter 11
protection on December 1, 2008 (Bankr. D. Del. Lead Case No.
08-13086). As reported by the TCR on December 30, 2008, Judge
Peter Walsh of the U.S. Bankruptcy Court for the District of
Delaware approved the transfer of the Chapter 11 cases to the U.S.
Bankruptcy Court for the District of Hawaii before Judge Lloyd
King (Bankr. D. Hawaii Lead Case No. 08-02005).
Richard M. Cieri, Esq., Paul M. Basta, Esq., and Christopher J.
Marcus, Esq., at Kirkland & Ellis LLP, represent the Debtors in
their restructuring efforts. The Debtors proposed Lazard Freres &
Co. LLC as investment banker; Zolfo Cooper Management LLC as
business advisor; Deloitte & Touche LLP as independent auditors;
and Kurztman Carson Consultants LLC as notice and claims agent.
An official committee of unsecured creditors has been appointed
and is represented by Christopher J. Muzzi, Esq., at Moseley Biehl
Tsugawa Lau & Muzzi LLC, in Honolulu, Hawaii.
When the Debtors filed for protection from their creditors, they
listed total assets of $1,352,000,000 and total debts of
$1,269,000,000 as of September 30, 2008.
Bankruptcy Creditors' Service, Inc., publishes Hawaiian Telcom
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Hawaiian Telcom Communications, Inc., and seven of
its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
HAWAIIAN TELCOM: Lazard & FTI Bill $6.4MM for 12 Months Work
------------------------------------------------------------
Pursuant to Sections 330 and 331 of the Bankruptcy Code, two
professionals retained in Hawaiian Telcom Communications' Chapter
11 cases filed with the Court their final fee applications:
Firm Period Fees Expenses
---- ------ ---------- ---------
Lazard Freres & Co. LLC 12/01/08- $4,000,000 $206,569
11/30/09
FTI Consulting, Inc. 12/01/08- 2,438,710 153,840
12/18/09
Lazard notes that it has received $2,112,368 from the Debtors.
Thus, it seeks the allowance of the remaining unpaid amount for
its fees and expenses, totaling $2,094,200.
FTI also seeks payment of $132,798 for fees related to unpaid
fees and expenses.
Lazard Freres is financial advisor to the Debtors. FTI serves as
financial advisor to the Official Committee of Unsecured
Creditors.
At the Committee's request, the Court will consider FTI's Final
Fee Application on an expedited basis on March 4, 2010.
Objections were due February 22, 2010. The Committee explains
that it is appropriate to expedite the hearing on FTI's Final Fee
Application because the fee applications of other professionals
in the Debtors' Chapter 11 cases will also be heard on March 4.
U.S. Trustee Opposes Lazard's Fees
Tiffany Carroll, the United States Trustee for Region 15,
complains that the amount of time Lazard devoted to the Debtors'
Chapter 11 cases, while substantial, has not been commensurate
with its total compensation request.
Curtis Ching, assistant U.S. Trustee, points out that 42.5% of
Lazard's total hours was billed by an Associate or Analyst, which
are noted to less experienced employees and whose time are billed
at lower rates. Similarly, he argues that 154.2 hours billed by
Lazard agents on "Internal update calls" and on non-working
travel of 70 hours further diminish the apparent value of
Lazard's overall time during the fee period. The "update" calls
and the noted travel time, while billable, are not the types of
services that help justify a blended hourly rate that far exceeds
all other professionals in the Debtors' Chapter 11 cases, he
asserts.
More importantly, Mr. Ching reminds the Court that Lazard was
retained in part due to its expertise in finding buyers or
investors which are often critical in the reorganization of large
corporations, but the Debtors confirmed a reorganization plan
that does not involve new buyers or new investors. "With the
Debtors having determined to proceed without a new investor,
Lazard's role as investment banker was diminished and was
reflected by the relatively modest number of hours as compared
against the total fee," he contends.
Thus, the U.S. Trustee seeks an opportunity to review Lazard's
invoices and time sheets for reimbursement of over $165,000 in
legal fees.
About Hawaiian Telcom
Based in Honolulu, Hawaii, Hawaiian Telcom Communications, Inc.
-- http://www.hawaiiantel.com/-- operates a telecommunications
company, which offers an array of telecommunications products and
services including local and long distance service, high-speed
Internet, wireless services, and print directory and Internet
directory services.
The Company and seven of its affiliates filed for Chapter 11
protection on December 1, 2008 (Bankr. D. Del. Lead Case No.
08-13086). As reported by the TCR on December 30, 2008, Judge
Peter Walsh of the U.S. Bankruptcy Court for the District of
Delaware approved the transfer of the Chapter 11 cases to the U.S.
Bankruptcy Court for the District of Hawaii before Judge Lloyd
King (Bankr. D. Hawaii Lead Case No. 08-02005).
Richard M. Cieri, Esq., Paul M. Basta, Esq., and Christopher J.
Marcus, Esq., at Kirkland & Ellis LLP, represent the Debtors in
their restructuring efforts. The Debtors proposed Lazard Freres &
Co. LLC as investment banker; Zolfo Cooper Management LLC as
business advisor; Deloitte & Touche LLP as independent auditors;
and Kurztman Carson Consultants LLC as notice and claims agent.
An official committee of unsecured creditors has been appointed
and is represented by Christopher J. Muzzi, Esq., at Moseley Biehl
Tsugawa Lau & Muzzi LLC, in Honolulu, Hawaii.
When the Debtors filed for protection from their creditors, they
listed total assets of $1,352,000,000 and total debts of
$1,269,000,000 as of September 30, 2008.
Bankruptcy Creditors' Service, Inc., publishes Hawaiian Telcom
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Hawaiian Telcom Communications, Inc., and seven of
its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
HAWAIIAN TELCOM: Proposes Incentive Payments to Union Employees
---------------------------------------------------------------
Hawaiian Telcom Communications, Inc., and its debtor affiliates
seek permission from Judge Lloyd King of the United States
Bankruptcy Court for the District of Hawaii to pay about 845
unionized employees pursuant to the Debtors' 2009 annual
compensation program on or before March 31, 2010.
Theodore D.C. Young, Esq., at Cades Schutte LLP, in Honolulu,
Hawaii, reminds the Court that one of the key documents
incorporated into the Debtors' Amended Joint Plan of
Reorganization is the 2009 Performance Compensation Program,
which is an essential part of Hawaiian Telcom's employees'
compensation packages. The Program provides appropriate
incentives for Hawaiian Telcom employees. Pursuant to the
confirmed Amended Chapter 11 Plan, the Debtors are authorized to
make payments of up to $8.5 million to employees pursuant to the
2009 Performance Compensation Program on the effective date of
the Amended Plan, he notes.
Mr. Young explains that a collective bargaining agreement between
Hawaiian Telcom and the International Brotherhood of Electrical
Workers Local 1357 governs the Union Employees' participation in
the 2009 Performance Compensation Program and requires Hawaiian
Telcom to make payments under the 2009 Performance Compensation
Program to the Union Employees during the first quarter of 2010,
assuming applicable targets are achieved.
The Amended Plan will only be declared effective after the
Debtors receive the necessary regulatory approvals. Thus, the
Debtors are currently working to obtain regulatory approvals of
the Amended Plan from the Hawaii Public Utilities Commission and
the Federal Communications Commission, according to Mr. Young.
While the Debtors cannot determine the length of the regulatory
approval process with certainty, they believe the process will
not conclude in the first quarter of 2010.
Given the timeline of the regulatory approval process and to
ensure that they remain in strict compliance of the CBA, the
Debtors thus filed the Union Payments Motion.
Failure to make the incentive payments to the Union Employees on
or before March 31, 2010 will be inconsistent with the terms of,
and requirements under, the CBA, Mr. Young points out. Given the
importance of the CBA to the Debtors' ongoing business operations
and strong working relationship with the IBEW, continued
compliance with the CBA is critical and appropriate before the
assumption of the CBA on the Plan Effective Date, he insists.
At the Debtors' request, the Court will consider the Union
Payments Motion on an expedited basis on March 4, 2010.
Objections are due no later than February 25 and the Debtor may
file counterreplies by March 1.
In support of the Debtors' hearing request, Brian S. Lennon,
Esq., a partner at Kirkland & Ellis LLP, counsel for the Debtors,
reminds the Court that there are no other hearings scheduled
prior to March 31, 2010 -- the date by which the CBA requires the
Debtors to honor their obligations to Union Employees under the
2009 Performance Compensation Program. He further discloses that
the Official Committee of Unsecured Creditors, the Secured
Lenders, and the United States Trustee do not object to the
Debtors' expedited hearing request.
IBEW Supports Debtors' Request
The IBEW filed a statement in support of the Union Payments
Motion.
Counsel to the IBEW, Rebecca Covert, Esq., at Takahashi,
Vasconcellos and Covert, in Honolulu, Hawaii, notes that among
other things, the Hawaiian Telcom/Local 1357 CBA provides certain
incentive compensation under a Team Performance Award program and
under the CBA, management assigns employees to teams and
establishes performance matrices. "The CBA provides a target
award -- 4% of compensation -- which can, if performance targets
are met, increase to 4.8% of compensation. If performance
targets are not met, the award may be reduced to zero," Ms.
Covert relates.
The IBEW avers that it negotiated for the continuance of the 2009
Performance Compensation Program in exchange for a number of
economic concessions demanded by the Debtors, including
substantial changes to retirement benefit under the CBA.
While the 2009 Performance Compensation Program provides for
relatively modest payments, they are significant to bargaining
unit employees, Ms. Covert tells the Court. Failure to make the
2009 Performance Compensation Program awards payments by
March 31, 2010, would thus be inconsistent with the Debtors'
obligations under the CBA, she points out.
The IBEW insists that bargaining unit employees perform a host of
tasks critical to the maintenance of Hawaiian Telcom's network.
Accordingly, motivation and commitment of those employees should
not be undermined by a failure to live up to the terms of their
collectively bargained compensation, including the 2009
Performance Compensation Program, Ms. Covert maintains.
In this light, the IBEW asks the Court to grant the Union
Payments Motion.
About Hawaiian Telcom
Based in Honolulu, Hawaii, Hawaiian Telcom Communications, Inc.
-- http://www.hawaiiantel.com/-- operates a telecommunications
company, which offers an array of telecommunications products and
services including local and long distance service, high-speed
Internet, wireless services, and print directory and Internet
directory services.
The Company and seven of its affiliates filed for Chapter 11
protection on December 1, 2008 (Bankr. D. Del. Lead Case No.
08-13086). As reported by the TCR on December 30, 2008, Judge
Peter Walsh of the U.S. Bankruptcy Court for the District of
Delaware approved the transfer of the Chapter 11 cases to the U.S.
Bankruptcy Court for the District of Hawaii before Judge Lloyd
King (Bankr. D. Hawaii Lead Case No. 08-02005).
Richard M. Cieri, Esq., Paul M. Basta, Esq., and Christopher J.
Marcus, Esq., at Kirkland & Ellis LLP, represent the Debtors in
their restructuring efforts. The Debtors proposed Lazard Freres &
Co. LLC as investment banker; Zolfo Cooper Management LLC as
business advisor; Deloitte & Touche LLP as independent auditors;
and Kurztman Carson Consultants LLC as notice and claims agent.
An official committee of unsecured creditors has been appointed
and is represented by Christopher J. Muzzi, Esq., at Moseley Biehl
Tsugawa Lau & Muzzi LLC, in Honolulu, Hawaii.
When the Debtors filed for protection from their creditors, they
listed total assets of $1,352,000,000 and total debts of
$1,269,000,000 as of September 30, 2008.
Bankruptcy Creditors' Service, Inc., publishes Hawaiian Telcom
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Hawaiian Telcom Communications, Inc., and seven of
its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
HCA INC: Fitch Assigns 'BB/RR1' Rating on $1 Bil. Note Offering
---------------------------------------------------------------
Fitch Ratings has assigned a 'BB/RR1' rating to HCA's proposed
$1.0 billion First Lien Notes offering. Fitch expects proceeds
from the 10.5 year notes issuance will be used to make mandatory
pro rata payments to its First Lien Term Loan A, maturing
Nov. 17, 2012; Term Loan B, maturing Nov.17, 2013; and European
Term Loan, maturing Nov. 17, 2013. The Rating Outlook is Stable.
Total rated debt at Dec. 31, 2009, was approximately
$25.67 billion.
On Feb. 1, 2010, Fitch affirmed HCA's rating after the company's
announcement to pay a special dividend of $1.75 billion to
shareholders, funded by cash on-hand and borrowings from the
company's $2 billion senior secured asset-based revolving credit
facility and $2 billion senior secured revolving credit facility,
both maturing in November 2012. This action increased total debt
and compressed liquidity from credit facilities borrowings.
Additionally, the dividend leads Fitch to expect that HCA will
likely continue to use much of its excess liquidity to return cash
to shareholders, which will limit its flexibility within the 'B'
ratings category. However, HCA's financial profile has benefited
from debt reduction in excess of $1.2 billion and strengthening
EBITDA during 2009. As a result, HCA reported gross debt leverage
of 4.69 times (x) for fiscal year ending Dec. 31, 2009, prior to
the special dividend being paid.
HCA's ratings reflect the company's significant leverage and
challenging industry environment, partially offset by improvements
in the company's operations. In addition, HCA's operations have
continued to improve as a result of cost management efforts,
strong same-facility admissions growth (including its eighth
consecutive quarter of positive same-facility adjusted admissions
growth reported for the third quarter of 2009), and new emergency
room coding efforts. However, Fitch expects the recent cost
benefit to the hospital industry stemming from improved labor
costs will likely moderate, once unemployment improves.
Key rating concerns also include the large amount of debt maturing
in the next several years, continued shareholder-friendly
transactions and an uncertain industry environment. Industry
uncertainty is being driven by stubbornly high unemployment
leading to prolonged pressure on bad debt expense as well as the
potential for health care reform. Finally, Fitch notes that an
exit by HCA's private equity sponsors through, for example, an
initial public offering, could also have an impact on its credit
profile.
At Dec. 31, 2009, HCA had $312 million in cash, $1.3 billion
available on its asset-based borrowing facility and $1.9 billion
available on its revolver. Subsequent to the mandatory
prepayments, Fitch expects that HCA will have approximately
$250 million of loans due in 2011, $1.45 billion of loans due in
2012 and $6.31 billion due in 2013. In addition, HCA has
approximately $760 million of bonds maturing in 2010, $270 million
maturing in 2011, $900 million maturing in 2012, $1 billion
maturing in 2013, $1.6 billion maturing in 2014, $900 million
maturing in 2015 and $5.8 billion maturing in 2016.
Fitch currently rates HCA Inc.'s debt:
-- Issuer Default Rating 'B';
-- Secured bank credit facility 'BB/RR1';
-- First lien notes 'BB/RR1';
-- Second lien notes 'B+/RR3';
-- Senior unsecured notes 'CCC/RR6'.
The Rating Outlook is Stable.
HCA INC: Moody's Assigns 'Ba3' Rating on $1 Bil. Senior Notes
-------------------------------------------------------------
Moody's Investors Service assigned a Ba3 (LGD3, 32%) rating to HCA
Inc.'s proposed offering of $1.0 billion of first lien senior
secured notes due 2020. Moody's also affirmed the existing
ratings of HCA, including the B2 Corporate Family and Probability
of Default Ratings. The outlook for the ratings is stable.
Moody's understands that the proceeds from the proposed offering
will be used to prepay, on a pro rata basis, outstanding amounts
on the company's senior secured term loans. Therefore, the
proposed issuance is not expected to result in any change in the
company's leverage. "Much like the secured note offerings
completed in 2009, the current transaction continues to chip away
at the considerable amount of bank debt scheduled to mature in the
2012 and 2013 time frame," said Dean Diaz, Vice President --
Senior Credit Officer at Moody's. While the repayment of bank
debt with the proceeds of these secured note offerings is expected
to increase interest expense, it is not expected to materially
affect cash flow and interest coverage metrics.
HCA's B2 Corporate Family Rating continues to reflect the
significant leverage of the company resulting from the November
2006 leveraged buyout. The considerable interest cost associated
with the debt load continues to constrain interest coverage
metrics and limits free cash flow. The rating also reflects the
anticipation that HCA's scale, market strength and recent focus on
cost containment should aid in weathering the unfavorable trends
in bad debt expense and weak volumes that have been and are
expected to continue to plague the industry as a whole.
Additionally, the company is expected to maintain good liquidity
over the next year even after funding the February 2010
distribution to shareholders with a draw down of the company's
available revolving credit facilities.
Moody's rating actions are summarized below.
Ratings assigned:
-- $1,000 million first lien secured notes due 2020, Ba3 (LGD3,
32%)
Ratings affirmed:
-- $2,000 million ABL Revolver due 2012, Ba2 (LGD2, 12%)
-- $2,000 million Revolving Credit Facility due 2012, Ba3 (LGD3,
32%)
-- $2,750 million Term Loan A due 2012, Ba3 (LGD3, 32%)
-- $8,800 million Term Loan B due 2013, to Ba3 (LGD3, 32%)
-- $1,250 million Euro Term Loan due 2013, Ba3 (LGD2, 23%)
-- $1,500 million first lien secured notes due 2019, Ba3 (LGD3,
32%)
-- $1,250 million first lien secured notes due 2020, Ba3 (LGD3,
32%)
-- $1,000 million Second Lien Notes due 2014, B2 (LGD4, 57%)
-- $3,200 million Second Lien Notes due 2016, B2 (LGD4, 57%)
-- $1,500 million Second Lien PIK Notes due 2016, B2 (LGD4, 57%)
-- Senior unsecured notes (various), Caa1 (LGD6, 90%)
-- Corporate Family Rating, B2
-- Probability of Default Rating, B2
-- Speculative Grade Liquidity Rating, SGL-2
Moody's last rating action was on July 29, 2009, when Moody's
assigned a Ba3 rating to HCA's first lien senior secured notes
offering and affirmed the existing ratings of the company.
Moody's also commented on January 29, 2009 that the company's
decision to make a distribution of $1.75 billion to its
shareholders had no impact on the rating.
Headquartered in Nashville, Tennessee, HCA is the nation's largest
acute care hospital company with 163 hospitals and 105
freestanding surgery centers (including eight hospitals and eight
freestanding surgery centers that are accounted for using the
equity method) as of December 31, 2009. For the year ended
December 31, 2009, the company recognized revenue in excess of
$30 billion.
HCA INC: S&P Assigns 'BB' Rating on $1 Bil. Senior Secured Notes
----------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned an issue-
level rating of 'BB' and a recovery rating of '1' to HCA Inc.'s
proposed $1 billion senior secured notes due 2020. All other
ratings are unchanged. The '1' recovery rating indicates the
expectation for very high (90%-100%) recovery of principal in the
event of default. The corporate credit rating on HCA Inc. is
'B+'. The rating outlook is positive.
"The rating on HCA Inc. reflects industry uncertainties that the
company faces in addition to still-significant debt leverage,"
said Standard & Poor's credit analyst David Peknay.
Ratings List
HCA Inc.
Corporate credit rating B+/Positive/--
Rating Assigned
Proposed $1 billion senior secured notes BB
Recovery rating 1
HIGHPOINT APARTMENTS: Case Summary & 12 Largest Unsec. Creditors
----------------------------------------------------------------
Debtor: Highpoint Apartments, L.L.C.
2710 Walsh Tarlton, #200
Austin, TX 78746
Bankruptcy Case No.: 10-10556
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Western District of Texas (Austin)
Judge: Craig A. Gargotta
Debtor's Counsel: Eric J. Taube, Esq.
Hohmann, Taube & Summers, L.L.P.
100 Congress Ave., Suite 1800
Austin, TX 78701
Tel: (512) 472-5997
Fax: (512) 472-5248
Email: erict@hts-law.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including a list of its
12 largest unsecured creditors, is available for free at:
http://bankrupt.com/misc/txwb10-10556.pdf
The petition was signed by Ricky C. Anderson, manager of the
Company.
HOMELAND SECURITY: Posts $818,616 Net Income for Dec. 31 Quarter
----------------------------------------------------------------
Homeland Security Capital Corporation reported net income
attributable to its common stockholders of $818,616 for the three
months ended December 31, 2009, from a net loss of $704,843 for
the same period in 2008. The Company posted a net loss
attributable to common stockholders of $362,367 for the six months
ended December 31, 2009, from a net loss of $2,960,052 for the
same period a year ago.
Net contract revenue was $26,572,415 for the fiscal second quarter
ended December 31, 2009, from $22,212,461 for the fiscal 2008
second quarter. Net contract revenue was $47,421,857 for the six
months ended December 31, 2009, from $39,879,692 for the same
period in 2008.
At December 31, 2009, the Company had total assets of $35,815,519
against total liabilities of $38,018,448 and Warrants Payable --
Series H Preferred Stock of $169,768. Stockholders' deficit was
$2,372,697 at December 31, 2009.
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?55f9
In March 2008, the Company entered into a stock purchase agreement
with YA Global Investments, L.P. pursuant to which the Company
sold to YA 10,000 shares of its Series H Convertible Preferred
Stock. The Series H Stock is convertible into shares of Common
Stock at an initial ratio of 33,333 shares of Common Stock for
each share of Series H Stock, subject to adjustments -- including
the Company's wholly owned subsidiary, Safety & Ecology Holdings
Corporation, achieving certain earnings milestones, as defined,
for the calendar years ending December 31, 2009 and 2008.
Safety operates its business on a fiscal year ending June 30.
Safety achieved the first milestone for the calendar year ending
December 31, 2008. However, the second financial milestone for
the calendar year ended December 31, 2009, has not been satisfied,
resulting in a potential adjustment to the conversion ratio
yielding approximately 56,300 shares of Common Stock for each
share of Series H Stock, or approximately a potential additional
230,000,000 shares of the Company's Common Stock in the aggregate.
Management is discussing with YA the possibility of a waiver or
amendment of any adjustment to the Series H Stock conversion
ratio, however there can be no assurances YA will waive or amend
the adjustment, if any, to the Series H Stock conversion ratio.
YA has not exercised its conversion rights as of February 22,
2010.
In June 2009 the Company entered into an agreement YA extending
the due date on its senior notes payable, and accrued interest, to
YA from March 14, 2010, until October 1, 2010, for $2,500,000 and
April 1, 2011, for $10,560,000. In exchange, the Company agreed
to an increase in the interest rate, from 13% to 15%, on the
senior notes payable and certain other debt due to YA, effective
January 1, 2010, if the Company failed to secure a certain
contract by March 2010. In December 2009, the Company was
informed that it had been eliminated from the award process for
this contract. Accordingly, the Company will begin recording
interest expense at the increased rate effective January 1, 2010.
About Homeland Security
Homeland Security Capital Corporation is an international provider
of specialized technology-based radiological, nuclear,
environmental disaster relief and electronic security solutions to
government and commercial customers.
HSM MYERS: Voluntary Chapter 11 Case Summary
--------------------------------------------
Debtor: HSM Myers, Ltd.
5001 Spring Valley Rd., Suite 1100-W
Dallas, TX 75244
Bankruptcy Case No.: 10-31512
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Barbara J. Houser
Debtor's Counsel: Gerald Philip Urbach, Esq.
Hiersche, Hayward, Drakeley & Urbach
15303 Dallas Parkway, Ste. 700
Addison, TX 75001
Tel: (972) 701-7026
Fax: (972) 701-8765
Email: gurbach@hhdulaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $500,001 to $1,000,000
The Debtor did not file a list of its 20 largest unsecured
creditors when it filed its petition.
The petition was signed by Don R. Plunk, president of G.P. of the
Company.
HUDSON'S FURNITURE: Files for Bankruptcy to Restructure REIT Debt
-----------------------------------------------------------------
Furniture Today says Hudson's Furniture Showrooms made a voluntary
filing under Chapter 11 to restructure real estate debt. The
filing came after talks on reducing real estate expenses with the
company's banks fell through.
Hudson's Furniture Showrooms operates a furniture showroom. The
Company plans to unveil a new Hudson's after remodeling nine of
its 12 full-line showrooms. The new company will be led by former
executive vice president Joshua Hudson, the report says.
IMPLANT SCIENCES: Reports $1.62-Mil. Net Loss for Dec. 31 Quarter
-----------------------------------------------------------------
Implant Sciences Corporation reported a net loss of $1,624,000 for
the three months ended December 31, 2009, from a net loss of
$2,061,000 for the 2008 quarter. The Company reported a net loss
of $3,273,000 for the six months ended December 31, 2009, from a
net loss of $1,705,000 for the 2008 period.
Revenues were $603,000 for the three months ended December 31,
2009, from $1,519,000 for the 2008 quarter. Revenues were
$2,423,000 for the six months ended December 31, 2009, from
$7,467,000 for the 2008 period.
As of December 31, 2009, the Company had total assets of
$5,475,000 against total liabilities of $12,995,000, including
total current liabilities of $12,928,000, and Series E Convertible
Preferred Stock of $5,000,000, and Series F Convertible Preferred
Stock of $378,000, resulting in stockholders' deficit of
$9,918,000.
In its quarterly report on Form 10-Q for the December 2009 period,
the Company indicated it has suffered recurring losses from
operations. The Company said there can be no assurances that its
forecasted results will be achieved or that it will be able to
raise additional capital necessary to operate its business. These
conditions, according to the Company, raise substantial doubt
about its ability to continue as a going concern.
"We have experienced a reduction in security revenue in the six-
month period ended December 31, 2009, as compared with the
comparable prior year period, relating to a decline in unit sales
of our trace explosives products. Security product sales tend to
have a long sale cycle, and are often subject to export controls.
In an effort to identify new opportunities and stimulate sales, we
have implemented a new sales tool to assist in this effort.
However, there can be no assurance that these efforts will
increase revenue," the Company said.
"We have a history of being active in submitting proposals for
government sponsored grants and contracts and successful in being
awarded grants and contracts from government agencies. However, we
have experienced a decline in government contract revenue in the
six month period ended December 31, 2009, as compared to the
comparable prior year period, due to the expiration of several
contracts in the six month period ended December 31, 2009.
Management will continue to pursue these grants and contracts to
support our research and development efforts primarily in the
areas of trace explosives detection," the Company added.
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?562c
About Implant Sciences
Implant Sciences Corporation (OBB: IMSC.OB) --
http://www.implantsciences.com/-- develops, manufactures and
sells sensors and systems for the security, safety and defense
(SS&D) industries.
As reported by the Troubled Company Reporter on January 15, 2010,
Implant Sciences renegotiated its credit agreements with its
senior secured investor, DMRJ Group LLC. DMRJ increased Implant
Sciences' line of credit from $3,000,000 to $5,000,000; extended
the maturity of all of Implant Sciences' indebtedness from
December 10, 2009, to June 10, 2010; waived all existing defaults
through the new maturity date; reduced the interest rate payable
on Implant Sciences' obligations to 15% per annum; and removed all
profit sharing arrangements from the agreements. Implant
Sciences' total indebtedness to DMRJ, including all principal and
accrued interest, now stands at $7,570,000.
INERGY LP: S&P Changes Outlook to Positive; Affirms 'BB-' Rating
----------------------------------------------------------------
Standard & Poor's Ratings Services revised the outlook on Inergy
LP to positive from stable, and affirmed its 'BB-' corporate
credit rating and 'B+' senior unsecured issue rating. A recovery
rating of '5' remains unchanged. The rating action follows S&P's
review of the partnership and reflects its view that the fee-based
midstream business will continue to grow and should account for
more than 40% of EBITDA during the next 12 to 18 months and
provide stable cash flows. As of Dec. 31, 2009, Inergy had total
debt, adjusted for operating leases and self-insurance reserves,
of $1.4 billion.
S&P's outlook revision primarily stems from the increasing
importance of Inergy's midstream business. In S&P's view, this
business provides a more stable cash flow stream than the propane
segment. S&P expects Inergy's midstream operations, which get
support from long-term, fee-based contracts with mostly
investment-grade counterparties, to account for about 40% of 2010
EBITDA. S&P believes this business could increase to about 50% of
EBITDA by 2012, after the Marc 1 Hub and North-South projects are
fully on-line. S&P is revising its business risk profile to
'fair' from 'weak' to reflect midstream's larger contribution to
Inergy's overall business mix. Inergy's U.S. Salt business also
provides relatively stable cash flows with about 70% of the salt
volumes under firm contracts that range from one to three years.
U.S. Salt is also strategically situated near Inergy's Stagecoach,
Steuben, Thomas Corners, and Bath storage facilities and can
provide incremental natural gas and liquid petroleum gas storage
capacity. The company's midstream assets are strategically
positioned to benefit from the high-demand Northeastern markets
and the rising production out of the Marcellus Shale.
INTEGRITY BANK: Loans to Single Borrower Led to Demise
------------------------------------------------------
Kris Hudson and Lingling Wei at The Wall Street Journal report
that the Federal Deposit Insurance Corp. is investigating the loan
practices at Integrity Bank of Alpharetta, Georgia. Integrity was
seized by banking regulators in August 2008 after lending all its
capital to commercial-real-estate developer Guy Mitchell, of Coral
Gables, Florida.
Integrity's deposits were sold to a unit of Regions Financial
Corp., and the FDIC was stuck with 97% of Integrity's $1.1 billion
in assets, according to the agency, the Journal reports. The
bank's failure cost the U.S. deposit-insurance fund $295 million,
according to the Journal.
The Journal notes that under Georgia law, it was originally
illegal for banks to lend more than 25% of their total capital
into a single borrower. The Journal relates that according to
regulators and an internal investigation before Integrity failed,
Integrity worked around the borrowing limit partly by extending
credit on different properties owned by Mr. Mitchell. That
eventually led to losses of more than $44 million on the loans.
The Journal says by 2008, Mr. Mitchell had 14 different loans from
Integrity that added up to $83 million, or 127% of the bank's
total capital of $65.3 million as of the middle of that year,
according to court and regulatory filings. The loans were secured
by the hotel, shopping centers and his home in Florida.
The Journal also relates that unlike many borrowers, Mr. Mitchell
wasn't required to make payments on the loans out of his own
pocket. Instead, according to Mr. Ellis, each loan had interest
reserves, or money that is set aside to cover payments until a
real-estate project starts generating cash flow. Some regulators
have criticized the use of interest reserves, claiming they can
make it harder to detect troubled loans.
According to the Journal, Mr. Mitchell's loans suffered as the
real-estate market weakened. At least several loans were in
default by 2007. An internal investigation by Integrity's board
found that some Integrity executives lent more money to Mr.
Mitchell to boost their own pay.
The Journal says when the FDIC moved in 2009 to foreclose on the
125-year-old Casa Madrona Hotel & Spa, one of Mr. Mitchell's
properties, the hotel filed for bankruptcy protection. A federal
judge ruled that the agency could proceed with the sale.
The Journal also relates that, according to documents filed in the
bankruptcy, before Integrity failed, it scrambled to salvage Mr.
Mitchell's shaky loans. The Journal says bank officials hoped to
sell the hotel and his shopping centers, and appraisals of Casa
Madrona estimated the hotel was worth $30 million to $80 million.
But the bank's overall losses had depleted its capital, and
regulators swooped in to shut down the bank.
INTERCARGO BROKERS: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Intercargo Brokers, LLC
13251 S. Unitec Dr.
Laredo, TX 78045
Bankruptcy Case No.: 10-50041
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Southern District of Texas (Laredo)
Judge: Wesley W. Steen
Debtor's Counsel: Carl Michael Barto, Esq.
Law Office of Carl M. Barto
817 Guadalupe St.
Laredo, TX 78040
Tel: (956) 725-7500
Fax: (956) 722-6739
Email: cmblaw@netscorp.net
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including a list of its
20 largest unsecured creditors, is available for free at:
http://bankrupt.com/misc/txsb10-50041.pdf
The petition was signed by Martin R. Tamez, owner the Company.
INTERNATIONAL COAL: Moody's Upgrades Corp. Family Rating to 'Caa1'
------------------------------------------------------------------
Moody's Investors Service upgraded the ratings of International
Coal Group, including the corporate family rating, to Caa1 from
Caa2. The rating outlook is stable. Simultaneously, Moody's
assigned a Ba3 rating to the new $125 million senior secured asset
based loan facility and withdrew the B1 rating on the previous
facility. The speculative grade liquidity rating was also raised
to SGL-3 from SGL-4.
The upgrade of ICG to Caa1 reflects the improved capital structure
profile stemming from ICG's reduced debt levels and elimination of
most financial maintenance covenants in the company's new ABL
facility. Moody's estimates that ICG benefits from approximately
$85 million less debt following the exchange of its convertible
notes for equity, over $7 million in less interest, and a slight
improvement in its maturity profile. The upgrade also considers
credit enhancements related to improved financial performance and
a stronger liquidity position stemming from a relatively strong
year in which ICG benefited from a well-contracted position, cost
containment, and increasing higher value metallurgical production.
The Caa1 rating incorporates ICG's elevated cost structure amidst
an uncertain price environment, inherent operating risk at its
mines, history of operating and financial challenges, significant
capital spending requirements, and uncertainty regarding mine
permitting obstacles particularly given the large percentage of
surface mine production. While ICG has committed and priced most
of its anticipated production in 2010, slightly more than half of
its production remains uncommitted in 2011. The ratings reflect
Moody's concerns about the company's ability to maintain its
margins amidst a high cost structure and uncertain thermal market
conditions.
The stable outlook assumes that conditions do not deteriorate
significantly in the steam coal market and ICG maintains adequate
liquidity and is able to refinance in the short-term most of its
convertible notes which are due in 2012. While the new ABL's
maturity is nominally 2014, it could become due as early as August
of 2011 if the company has been unable to refinance most of its
convertible notes.
The upgrade of the speculative grade liquidity rating to SGL-3
from SGL-4 considers Moody's opinion of ICG's adequate liquidity
profile in light of its cash balance and the capital structure.
Internal liquidity is provided by approximately $93 million of
balance sheet cash at December 31, 2009 (though Moody's expects
this to decline over the immediate term due to interest payments
and seasonal working capital needs) and expected cash flow from
operations over the next twelve months. However, Moody's believes
that free cash flow could be limited after consideration of
approximately $90 million of maintenance capex in 2010. While the
new ABL facility will be governed by a borrowing base and will
only maintain a capex limitation and springing fixed charge
coverage ratio, ABL availability is likely to be limited by at
least $74 million of letters of credit outstanding.
Ratings impacted by the actions include:
-- Corporate Family Rating upgraded to Caa1 from Caa2
-- Probability of Default Rating upgraded to Caa1 from Caa2
-- $125 million asset based loan facility due 2014 assigned Ba3
(LGD 2; 18%)
-- $175 million 10.25% senior unsecured notes due 2014 upgraded
to Caa2 (LGD 5; 70%) from Caa3 (LGD 4; 67%)
-- Outlook changed to stable from negative
-- SGL upgraded to SGL-3 from SGL-4
Rating to be withdrawn:
-- $100 million asset based loan facility of B1 (LGD 2; 13%)
The last rating action was on March 16, 2009 when the ratings of
ICG were lowered, including the CFR which was downgraded to Caa2
from Caa1.
International Coal Group, Inc., operates 13 coal mining complexes
(8 in Central Appalachia, 4 in Northern Appalachia, and 1 in the
Illinois Basin). ICG owns approximately two-thirds of its
1.0 billion tons of coal reserves. The company produced
approximately 16.3 million tons of coal in 2009.
INTERNATIONAL LEASE: Fitch Rates Issuer Default Rating at 'BB'
--------------------------------------------------------------
Fitch Ratings expects to rate International Lease Finance Corp.'s
$750 million secured term loan 'BBB-'. This instrument will be
placed on Rating Watch Negative when issued to align its Watch
status with that of issuer ILFC.
The senior secured term loan is rated two notches above ILFC's
long-term Issuer Default Rating of 'BB.' This reflects a
combination of superior collateral coverage and structural
protection. Collateral consists of a perfected security interest
in 43 aircraft registered in countries that have ratified the Cape
Town Convention. Based on the estimated value of the aircraft,
the loan-to-value for this transaction will equal approximately
56% at closing. ILFC will be required to maintain a maximum 63%
loan-to-value on an ongoing, quarterly basis. Structural
protection also includes aircraft and lessee concentration limits.
The rating action taken does not affect the existing IDRs and debt
ratings of issuer ILFC. On Feb. 18, 2010, Fitch downgraded ILFC's
IDR and senior unsecured debt to 'BB' from 'BBB' and retained both
the IDR and debt ratings on Rating Watch Negative. The February
rating action reflected Fitch's concern that ultimate parent AIG's
willingness to extend support to ILFC may be more limited than
previously assumed and may not extend beyond ILFC's efforts to
restructure and generate liquidity to repay forthcoming maturing
debt obligations.
Resolution of the Rating Watch will primarily reflect ILFC's
ability to resolve substantial near-term funding pressure by
generating sufficient liquidity through aircraft sales, extension
or amendment of the current bank facilities, and procurement of
third-party secured debt financing to satisfy near-term funding
obligations and minimize the likelihood for further support from
AIG.
Furthermore, although the volume of unencumbered aircraft remains
adequate to support repayment of unsecured debt, Fitch remains
concerned that significant further encumbrance of the aircraft
portfolio, either via indirect government support or third-party
secured financing, may effectively result in subordination of
existing unsecured bondholders. This could potentially result in
downward notching of the senior unsecured debt rating.
Fitch expects to assign this rating, and to place the rated
securities on Rating Watch Negative:
International Lease Finance Corporation
-- Senior secured debt 'BBB'.
INTERPUBLIC GROUP: S&P Gives Positive Outlook; Affirms 'B+' Rating
------------------------------------------------------------------
Standard & Poor's Ratings Services revised its rating outlook on
New York City-based Interpublic Group of Companies Inc. to
positive from stable. S&P affirmed its existing ratings on the
company, including the 'B+' corporate credit rating.
"The outlook revision reflects S&P's expectation that Interpublic
should be able to reduce leverage modestly, primarily in the
second half of the year, and regain some of the margin expansion
it has ceded over the past 12 months," said Standard & Poor's
credit analyst Heather Goodchild.
S&P's view incorporates the assumption that advertising and
marketing services spending will remain under pressure, albeit
decreasing pressure, during the first half of 2010. S&P believes
the company could meet its goal of achieving 2008 profitability
levels in 2010, even with flat organic revenue (management's
current outlook), if Interpublic doesn't continue to incur
significant severance expenses. Separately, the company has
improved its overall liquidity over the past year.
Interpublic recently obtained an amendment from its banks to
accommodate covenant pressure caused by near-term operating
softness and higher-than-expected severance expense. S&P expects
that headroom could become very slim when the leverage covenant
tightens at June 30, 2010. Still, it is S&P's view that the
company's strong liquid resources (including $2.5 billion in cash
as of Dec. 31, 2009), ability to buy in term debt, and likely
ability to obtain a waiver mitigate this concern. Interpublic has
not historically drawn on its committed facilities and only uses
them for letters of credit. It recently moved the majority of
outstanding LOCs to its new ?45 million credit facility.
The 'B+' rating on Interpublic reflects continued near-term
cyclical pressure on organic revenue trends, the hurdles that the
industry faces in reducing operating costs in line with revenue
declines, ongoing weakness in certain key industries (such as auto
and technology), and lower EBITDA margins and cash generation than
comparable peers'. Interpublic's broad business mix of
traditional advertising and marketing services, progress with
business wins since 2007, and very strong cash balances are
positive considerations in the rating that do not offset the
negative factors.
Balance sheet debt to EBITDA was 3.4x at Dec. 31, 2009, compared
with 2.5x at year-end 2008. Lease- and pension-adjusted debt to
EBITDA (including preferred stock, acquisition-related puts and
calls, and the present value of acquisition-related earn-outs) was
significantly higher, at 6.0x. S&P view further organic revenue
contraction as likely, with the potential to push leverage
slightly higher in the first quarter of 2010. S&P believes that
leverage could start to come down in the second half of the year,
and could further benefit if the company decides to repay the
maturity of its floating-rate notes in November 2010 with excess
cash. Lease- and-pension-adjusted EBITDA coverage of interest and
preferred dividends was 2.3x as of Dec. 31, 2009, down from 2.6x
in 2008.
The company converted a healthy 74% of EBITDA to discretionary
cash flow for 2009, due to good working capital management and
significantly reduced capital expenditures. Capital spending was
less than 12% of EBITDA, compared to 16.4% in 2008. Absolute
discretionary cash flow was down about 38% for the year, but S&P
expects it to improve modestly in 2010.
JAPAN AIRLINES: Ends Cargo Business Merger Talks With NYK
---------------------------------------------------------
The JAL Group announced that it ended negotiations with Nippon
Yusen Kabushiki Kaisha (NYK) on cargo business reform involving a
possible merger between Japan Airlines International (JAL), the
key subsidiary of Japan Airlines and NYK subsidiary, Nippon Cargo
Airlines (NCA).
The commencement of negotiations involving the restructuring of
cargo business operated by JAL and NCA was announced in August
2009, and the feasibility of a potential merger between the cargo
business of JAL and NCA was being analyzed. Both parties have
reached an amicable conclusion to end the negotiations because the
structure of the merger could not be organized within the scope of
the agreement between JAL and NYK.
Nevertheless, JAL and NCA will continue their existing business
relationships including operating code-sharing flights and
coordinating ground handling activities. Both companies will
maintain close communications in their current business
partnership, and will be open to discussions about any possible
cooperation in the future.
"JAL's strong relationship with Nippon Yusen remains unchanged as
we reach a common understanding to halt discussions about the
merger. We intend to maintain mutually-beneficial business
activities with NCA including the current code share flights, and
preserve the cooperation that we have already established," said
JAL Group Chief Operating Officer and President, Masaru Onishi.
"Demand for air cargo business typically fluctuates with the
economy. Considering future growth in the segment, JAL will
include strategies for our cargo business in the JAL
Reorganization Plan."
About Japan Airlines
Japan Airlines Corporation -- http://www.jal.co.jp/-- is a
Japan-based company mainly engaged in the provision of air
transport services. The Company is active in five business
segments through its 203 subsidiaries and 83 associated companies.
JAL International Co. Ltd. is a wholly owned operating subsidiary
of Japan Airlines Corporation.
Japan Airlines Corporation, Japan Airlines International Co., Ltd.
and JAL Capital Co., Ltd., on January 19, 2010, filed the
petitions to commenced corporate reorganization proceedings with
the Tokyo District Court. The Court appointed the Enterprise
Turnaround Initiative Corporation of Japan and Eiji Katayama,
Esq., as reorganization trustees.
Japan Airlines Corp. filed for reorganization January 19 in the
Tokyo District Court and filed a Chapter 15 petition in New York
(Bankr. S.D.N.Y. Case No. 10-10198). The Company said debt is
$28 billion.
Bankruptcy Creditors' Service, Inc., publishes Japan Airlines
Bankruptcy News. The newsletter tracks the Chapter 15 proceedings
and the bankruptcy proceedings in Tokyo undertaken by Japan
Airlines Corp. and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
JAPAN AIRLINES: Establishes Compliance Investigations Panel
-----------------------------------------------------------
The JAL Group announced that on March 2, 2010, it will establish a
Compliance Investigations Committee whose main objective is
to examine past business practices of the JAL Group.
Committed to executing a fair and transparent restructuring under
the Corporate Reorganization Proceedings, the JAL Group will
commission the Committee to launch an investigation into past
business management of the JAL Group to determine if there were
any issues about compliancy, and to identify problems in that
aspect. Key findings will then be reported to the appointed
Trustees.
The Committee is an independent investigative organization formed
by third-party members including Saiguchi Chiharu -- a lawyer
belonging to the Tokyo Bar Association and a current member
of the Supreme Court of Japan, and Kainaka Tatsuo -- a former
member of the Supreme Court of Japan, who will be able to provide
their professional opinion from a neutral stance in order to
impartially and effectively assess the JAL Group.
Starting March 2, 2010, the Committee will commence its research
into the Group's history.
About Japan Airlines
Japan Airlines Corporation -- http://www.jal.co.jp/-- is a
Japan-based company mainly engaged in the provision of air
transport services. The Company is active in five business
segments through its 203 subsidiaries and 83 associated companies.
JAL International Co. Ltd. is a wholly owned operating subsidiary
of Japan Airlines Corporation.
Japan Airlines Corporation, Japan Airlines International Co., Ltd.
and JAL Capital Co., Ltd., on January 19, 2010, filed the
petitions to commenced corporate reorganization proceedings with
the Tokyo District Court. The Court appointed the Enterprise
Turnaround Initiative Corporation of Japan and Eiji Katayama,
Esq., as reorganization trustees.
Japan Airlines Corp. filed for reorganization January 19 in the
Tokyo District Court and filed a Chapter 15 petition in New York
(Bankr. S.D.N.Y. Case No. 10-10198). The Company said debt is
$28 billion.
Bankruptcy Creditors' Service, Inc., publishes Japan Airlines
Bankruptcy News. The newsletter tracks the Chapter 15 proceedings
and the bankruptcy proceedings in Tokyo undertaken by Japan
Airlines Corp. and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
JAPAN AIRLINES: Widens Operating Loss to JPY120.8-Bil. for 3Qs
--------------------------------------------------------------
The JAL Group released consolidated results for the first three
quarters (April - December inclusive) of fiscal year 2009.
Japan Airlines Corporation, Japan Airlines International Co.,
Ltd., and JAL Capital Co., Ltd., filed on January 19, 2010, an
application to the Enterprise Turnaround Initiative Corporation of
Japan (ETIC) for support for its restructuring and also filed for
petitions with the Tokyo District Court (the Court) for
commencement of corporate reorganization proceedings. JAL
received the decision from ETIC that it will provide support and
on the same day, the Court entered an order commencing the
proceedings.
JAL recognizes and is deeply apologetic for the current situation
that has caused great inconvenience and concern to our
shareholders, financial creditors, customers, suppliers and other
related parties. Now, JAL is working fervently with the ETIC
under the supervision of the court and court-appointed trustees
(Trustees) to draw up an effective corporate revitalization plan
to rebuild the airline, while continuing to provide safe and
stable flight operations and services to customers. The JAL Group
will stand united in our efforts to strive towards achieving a
successful reform.
The consolidated operating revenue for this reporting period
decreased by 414.4 billion yen compared to that of last year. On
the other hand, operating expense was substantially reduced in
almost every cost category, achieving a 302.5 billion yen decrease
from the same period last year to 1,265.6 billion yen. Operating
loss widened by 111.9 billion yen to 120.8 billion yen while
ordinary loss increased by 127.7 billion yen to 153.3 billion.
The resulting net loss for this reporting period is 177.9 billion
yen, 176 billion yen more than previous year.
The consolidated financial statements for this reporting term were
prepared on the going concern assumption, where the effects of
substantial uncertainties related to the going concern assumption
are not reflected in this report. Abiding by Section 83, Part 1
and 3 of the Japanese Corporate Rehabilitation Law, the Group's
assets are now being evaluated by the Trustees based on current
market values. Japan Airlines Corporation, Japan Airlines
International Co., Ltd., and JAL Capital Co., Ltd., are now
operating under the Corporate Reorganization Proceedings and thus,
their accounting term, as well as that used by the JAL Group for
its consolidated financial report formally ended on January 19,
2010*.
*The fiscal period (April 1 to March 31) of other individual Group
companies remain unchanged.
JAL Group Consolidated Financial Results for the
Period April 1- December 31, 2009
Units: 04/01 - 04/01 - Year-on-year Year-on year
billion yen 12/21/2009 12/31/2008 Difference Comparison
----------- ---------- ---------- ------------ ------------
Operating 1,144.8 1,559.3 - 414.4 73.4%
revenue
Int'l. Passenger 336.3 570.2 -233.8 59.0%
Domestic passenger 455.7 520.9 -65.2 87.5%
Int'l. cargo 74.2 133.5 -59.3 55.6%
Others 278.5 334.5 -55.9 83.3%
Operating costs 1,265.6 1,568.1 -302.5 80.7%
Operating income
(loss) -120.8 -8.8 -111.9 -
Ordinary income
(loss) -153.3 -25.6 -127.7 -
Net income (loss) -177.9 -1.9 -176.0 -
* Figures rounded down to the nearest 100 million yen.
* Average exchange rate for the reporting period (April 1 through
to December 31, 2009): US$1 = JPY 94.1 / EUR1 = JPY 132.6
Forecast of results for the full year ending March 31, 2010
As conditions required for a realistic estimate of earnings and
details of the restructuring plan are undecided at this point in
time, JAL will not be announcing a forecast for the full fiscal
year of 2009.
APPENDICES
A. JAL Group FY2009 3rd Quarter Consolidated Financial Results
Units: 3rd Quarter 3rd Quarter Previous Previous
billions FY09 (10/01- FY08 (10/01- Year Year %
of yen 12/31/2009) 12/31/2008) Comparison Comparison
-------- ----------- ----------- ---------- ----------
Operating 380.8 485.7 -104.8 78.4%
revenue
Int'l. Passenger 110.8 176.3 -65.5 62.9%
Domestic passenger 144.9 168.4 -23.4 86.1%
Int'l. cargo 31.1 38.1 -7.0 81.6%
Others 93.8 102.7 -8.8 91.4%
Total operating
expenses 405.9 524.7 -118.8 77.3%
Operating income
(loss) -25.0 -39.0 14.0 -
Ordinary income
(loss) -38.9 -43.6 4.7 -
3rd quarter net
income (loss) -46.7 -38.5 -8.1 -
B. JAL Group FY2009 2nd Quarter Consolidated Financial Results
Units: 2nd Quarter 2nd Quarter Previous Previous
billions FY09 (07/01- FY08 (07/01- Year Year %
of yen 09/30/2009) 09/30/2008) Comparison Comparison
-------- ----------- ----------- ---------- ----------
Operating 429.0 583.2 -154.2 73.6%
revenue
Int'l. Passenger 128.1 213.3 -85.2 60.0%
Domestic passenger 179.5 198.8 -19.2 90.3%
Int'l. cargo 23.1 49.9 -26.8 46.3%
Others 121.0 -22.8 81.1%
Total operating
expenses 438.7 556.8 -118.1 78.8%
Operating income
(loss) -9.6 26.4 -36.0 -
Ordinary income
(loss) -20.4 17.3 -37.7 -
2nd quarter net
income (loss) -32.1 40.1 -72.2 -
C. JAL Group FY2009 1st Quarter Consolidated Financial Results
Units: 1st Quarter 1st Quarter Previous Previous
billions FY09 (04/01- FY08 (04/01- Year Year %
of yen 06/30/2009) 06/30/2008) Comparison Comparison
-------- ----------- ----------- ---------- ----------
Operating 334.8 490.3 -155.4 68.3%
revenue
Int'l. Passenger 97.3 180.4 -83.1 53.9%
Domestic passenger 131.1 153.7 -22.5 85.3%
Int'l. cargo 19.9 45.4 -25.5 43.8%
Others 86.4 110.7 -24.2 78.1%
Total operating
expenses 421.0 486.4 -65.4 86.6%
Operating income
(loss) -86.1 3.9 -90.0 -
Ordinary income
(loss) -93.9 0.7 -94.7 -
3rd quarter net
income (loss) -99.0 -3.4 -95.6 -
D. JAL Group Consolidated Traffic Statistics
3rd Quarter 2009 3rd Quarter 2008 Change by %
04/01 - 12/31/09 04/01 - 12/31/09 or points
---------------- ---------------- -----------
INTERNATIONAL
-------------
Passenger number 8,159,881 8,891,313 91.8%
Revenue passenger(000) 36,521,975 39,970,292 91.4%
Available seat kms(000) 52,716,274 60,745,669 86.8%
Revenue seat load
factor 69.3% 65.8% 3.5
Revenue cargo ton
kms(000) 2,267,463 2,901,189 78.2%
Mail ton
kilometers(000) 146,071 150,115 97.3%
Revenue ton kms(000) 5,800,982 6,754,908 85.9%
Available ton kms(000) 8,735,374 10,834,909 80.6%
Revenue weight load
factor 66.4% 62.3% 4.1
DOMESTIC
--------
Passenger number 28,415,288 31,940,692 89.0%
Revenue passenger(000) 21,626,956 39,970,292 91.4%
Available seat kms(000) 36,190,854 37,495,690 96.5%
Revenue seat load
factor 59.8% 64.7% -4.9
Revenue cargo ton
kms(000) 328,741 358,317 91.7%
Mail ton
kilometers(000) 17,675 22,012 80.3%
Revenue ton kms(000) 1,966,757 2,198,078 89.5%
Available ton kms(000) 4,309,828 4,471,163 96.4%
Revenue weight load
factor 45.6% 49.2% -3.6
TOTAL
-----
Passenger number 36,575,169 40,832,005 89.6%
Revenue passenger(000) 58,148,931 64,225,116 90.5%
Available seat kms(000) 88,907,128 98,241,359 90.5%
Revenue seat load
factor 65.4% 65.4% 0.0
Revenue cargo ton
kms(000) 2,596,204 3,259,506 79.7%
Mail ton
kilometers(000) 163,746 172,127 95.1%
Revenue ton kms(000) 7,767,739 8,952,986 86.8%
Available ton kms(000) 13,045,202 15,306,072 85.2%
Revenue weight load
factor 59.5% 58.5% 1.0
About Japan Airlines
Japan Airlines Corporation -- http://www.jal.co.jp/-- is a
Japan-based company mainly engaged in the provision of air
transport services. The Company is active in five business
segments through its 203 subsidiaries and 83 associated companies.
JAL International Co. Ltd. is a wholly owned operating subsidiary
of Japan Airlines Corporation.
Japan Airlines Corporation, Japan Airlines International Co.,
Ltd., and JAL Capital Co., Ltd., on January 19, 2010, filed the
petitions to commenced corporate reorganization proceedings with
the Tokyo District Court. The Court appointed the Enterprise
Turnaround Initiative Corporation of Japan and Eiji Katayama,
Esq., as reorganization trustees.
Japan Airlines Corp. filed for reorganization January 19 in the
Tokyo District Court and filed a Chapter 15 petition in New York
(Bankr. S.D.N.Y. Case No. 10-10198). The Company said debt is
$28 billion.
Bankruptcy Creditors' Service, Inc., publishes Japan Airlines
Bankruptcy News. The newsletter tracks the Chapter 15 proceedings
and the bankruptcy proceedings in Tokyo undertaken by Japan
Airlines Corp. and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
K-CARM INC: Case Summary & 13 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: K-Carm, Inc.
P.O. Box 2429
Odessa, TX 79760
Bankruptcy Case No.: 10-70068
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Western District of Texas (Midland)
Judge: Craig A. Gargotta
Debtor's Counsel: Wiley France James, III, Esq.
James & Haugland, P.C.
P.O. Box 1770
El Paso, TX 79949-1770
Tel: (915) 532-3911
Fax: (915) 541-6440
Email: wjames@jghpc.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $0 to $50,000
A list of the Company's 13 largest unsecured creditors is
available for free at:
http://bankrupt.com/misc/txwb10-70068.pdf
The petition was signed by Kay Price, president of the company.
KHORASAN LLC: Case Summary & 5 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Khorasan, LLC
dba McKinney Exxon
300 E. University Drive
McKinney, TX 75069
Bankruptcy Case No.: 10-40711
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Eastern District of Texas (Sherman)
Debtor's Counsel: Eric A. Liepins, Esq.
12770 Coit Road, Suite 1100
Dallas, TX 75251
Tel: (972) 991-5591
Email: eric@ealpc.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
According to the schedules, the Company has assets of $1,081,000,
and total debts of $2,531,013.
A full-text copy of the Debtor's petition, including a list of its
5 largest unsecured creditors, is available for free at:
http://bankrupt.com/misc/txeb10-40711.pdf
The petition was signed by Sam Saif, managing member the Company.
KINDER MORGAN: Fitch Affirms NGPL'S Issuer Default & Debt Ratings
-----------------------------------------------------------------
Fitch Ratings has affirmed the Issuer Default Rating and
outstanding senior unsecured debt ratings for NGPL PipeCo LLC at
'BBB-'. The Rating Outlook is Stable. The rating action affects
$3 billion of outstanding debt. NGPL is 80% owned by Myria
Acquisition Inc. , a consortium of investors including Prime
Infrastructure Group, a Canadian pension fund and a Netherlands
pension fund and 20% owned by Kinder Morgan, Inc. (IDR 'BB+',
Stable Outlook).
NGPL's ratings and Stable Outlook reflect the predictable cash
flows generated by its Federal Energy Regulatory Commission
regulated pipeline assets, a favorable competitive market
position, limited liquidity needs and a conservative growth
strategy. NGPL is one of the largest interstate pipeline and
storage systems in the U.S. While the Chicago/Midwest market that
it delivers into is served by several competing pipelines, NGPL
boasts competitive rate structures and has been able to maintain
its strong market position. Pipeline capacity is mostly committed
under contracts ranging from one to five years with an average
contract length of two years. The average contract length is
relatively short. However, NGPL has been able to limit capacity
re-contracting risk and generally maintain its revenues from
contract rollovers. In addition, NGPL's position is enhanced by
its access to diverse and resource-rich supply areas and
deliverability to a high quality, utility dominated customer base.
The ratings also consider several offsetting factors. Most
significantly, in November 2009, NGPL was notified by FERC of a
proceeding against it under Section Five of the Natural Gas Act to
determine whether NGPL's current rates, which were approved by
FERC in NGPL's last rate case settlement, remain just and
reasonable. In response, in February 2010, NGPL submitted cost
and revenue studies with FERC indicating it under-recovered its
cost of service for the 12 months period ended October 2009.
Resolution of the case may extend into 2011. Fitch would consider
taking negative rating action against NGPL should its projected
revenues be materially lowered because of the FERC rate case.
Based on Fitch estimates, NGPL will continue to trend toward the
higher ranges of leverage for investment grade pipelines, with
debt/EBITDA expected to fall between 4.5 times and 5.0x over the
next several years. In addition, NGPL exhibits some sensitivity
to commodity prices through its operational efficiency sales. As
a result, absent the benefit of hedges, revenues would be expected
to decline in a softening natural gas price environment. Finally,
as with other pipeline systems, NGPL is exposed to margin
deterioration as the U.S. pipeline infrastructure continues to
evolve and natural gas supply, demand and price dynamics change.
KINSLEY FOREST: Case Summary & 2 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Kinsley Forest Estates, LLC
9616 Vista Drive
Lenexa, KS 66220
Bankruptcy Case No.: 10-40896
Chapter 11 Petition Date: March 2, 2010
Court: United States Bankruptcy Court
Western District of Missouri (Kansas City)
Judge: Jerry W. Venters
Debtor's Counsel: Nancy S. Jochens, Esq.
Jochens Law Office, Inc.
1001 E. 101st Terrace, Suite 170
Kansas City, MO 64131
Tel: (816) 994-6959
Fax: (816) 994-6958
Email: njochens@kc.rr.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $1,000,001 to $10,000,000
According to the schedules, the Company has assets of $16,250,485,
and total debts of $7,859,000.
The petition was signed by Hudson K. Gilliland, the company's
manager.
Debtor's List of 2 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Clay County 2009 Real Estate $46,000
Taxes
Douglas Gilliland $153,000
L & G: Section 341(a) Meeting Scheduled for March 11
----------------------------------------------------
The U.S. Trustee for Region 16 will convene a meeting of creditors
in L & G Rosemead Garden, LLC's Chapter 11 case on March 11, 2010,
at 9:00 a.m. The meeting will be held at 725 S Figueroa Street,
Room 2610, Los Angeles, CA 90017.
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.
El Monte, California-based L & G Rosemead Garden, LLC, filed for
Chapter 11 bankruptcy protection on January 28, 2010 (Bankr. C.D.
Calif. Case No. 10-13084). Robert G. Berke, Esq., at Berke Law
Offices, assists the Company in its restructuring effort. The
Debtor listed $1,000,001 to $10,000,000 in assets and $10,000,001
to $50,000,000 in liabilities.
The Debtor's affiliates -- 330 Naomi LLC, Prelude Investment LLC,
and L&G Garvey Investment LLC -- filed separate Chapter 11
petitions.
L & G: Files Schedules of Assets & Liabilities
----------------------------------------------
L & G Rosemead Garden, LLC, has filed with the U.S. Bankruptcy
Court for the Central District of California its schedules of
assets and liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ------ -----------
A. Real Property $1,567,000
B. Personal Property $3,517
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $984,734
E. Creditors Holding
Unsecured Priority
Claims $14,069
F. Creditors Holding
Unsecured Non-priority
Claims $0
------------- ------------
TOTAL $1,570,517 $998,803
El Monte, California-based L & G Rosemead Garden, LLC, filed for
Chapter 11 bankruptcy protection on January 28, 2010 (Bankr. C.D.
Calif. Case No. 10-13084). Robert G. Berke, Esq., at Berke Law
Offices, assists the Company in its restructuring effort. The
Debtor listed $1,000,001 to $10,000,000 in assets and $10,000,001
to $50,000,000 in liabilities.
The Debtor's affiliates -- 330 Naomi LLC, Prelude Investment LLC,
and L&G Garvey Investment LLC -- filed separate Chapter 11
petitions.
LONE STAR BREWERY: Files for Ch. 11 to Avert Foreclosure
--------------------------------------------------------
Jason Buch at Express News reports that Lone Star Brewery filed
for Chapter 11 bankruptcy to avert a scheduled foreclosure auction
after the Company failed to make a loan interest payment.
Lone Star Brewery owns a modern condo in San Antonio, Texas. The
Company said it has $7 million in assets and $3.8 million in
liabilities.
LRL CITI: Files Schedules of Assets and Liabilities
---------------------------------------------------
LRL Citi Properties I DE, LLC, filed with the U.S. Bankruptcy
Court for the Northern District of California its schedules of
assets and liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $66,942,057
B. Personal Property $2,325,970
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $70,677,908
E. Creditors Holding
Unsecured Priority
Claims $622,217
F. Creditors Holding
Unsecured Non-priority
Claims $990,380
----------- -----------
TOTAL $69,268,027 $72,290,505
San Francisco, California-based LRL Citi Properties I DE, LLC,
filed for Chapter 11 bankruptcy protection on February 8, 2010
(Bankr. N.D. Calif. Case No. 10-30414). M. Elaine Hammond, Esq.,
at Friedman, Dumas and Springwater, assists the Company in its
restructuring effort. The Company listed $50,000,001 to
$100,000,000 in assets and $50,000,001 to $100,000,000 in
liabilities.
The Debtor's affiliates -- Trophy Properties I DE, LLC; Sutter
Associates DE, LLC; Hermann Street DE, LLC -- filed separate
Chapter 11 petitions.
LAKE SHORE CROSSING: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------------
Debtor: Lake Shore Crossing, LP
1837 W. Frankford Road, # 108
Carrollton, TX 75007
Bankruptcy Case No.: 10-31404
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Barbara J. Houser
Debtor's Counsel: Mark H. Ralston, Esq.
The Ralston Law Firm
2603 Oak Lawn AvenueSuite 230, LB 2
Suite 230, LB 2
Dallas, TX 75219-9109
Tel: (214) 295-6416
Fax: (214) 281-8720
Email: ralstonlaw@gmail.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including a list of its
20 largest unsecured creditors, is available for free at:
http://bankrupt.com/misc/txnb10-31404.pdf
The petition was signed by Moyez Thanawalla, director and general
partner the Company.
LAKEVIEW DEVELOPMENT: Case Summary & 4 Largest Unsecured Creditors
------------------------------------------------------------------
Debtor: Lakeview Development Partners, LLC
PO Box 609
Perry, GA 31069
Bankruptcy Case No.: 10-50656
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Middle District of Georgia (Macon)
Debtor's Counsel: Wesley J. Boyer, Esq.
Katz, Flatau, Popson and Boyer, LLP
355 Cotton Avenue
Macon, GA 31201
Tel: (478) 742-6481
Email: wjboyer_2000@yahoo.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including a list of its
4 largest unsecured creditors, is available for free at:
http://bankrupt.com/misc/gamb10-50656.pdf
The petition was signed by M. S. Tolleson Jr.
LIVINGSTON APARTMENTS: Case Summary & 13 Largest Unsec. Creditors
-----------------------------------------------------------------
Debtor: Livingston Apartments, LP
128 East Seventh Street
Plainfield, NJ 07060
Bankruptcy Case No.: 10-15847
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
District of New Jersey (Newark)
Debtor's Counsel: Richard D. Trenk, Esq.
Trenk, DiPasquale, Webster,
Della Fera & Sodono, P.C.
347 Mt. Pleasant Avenue, Suite 300
West Orange, NJ 07052
Tel: (973) 243-8600
Email: rtrenk@trenklawfirm.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including a list of its
13 largest unsecured creditors, is available for free at:
http://bankrupt.com/misc/njb10-15847.pdf
The petition was signed by David M. Connolly.
Debtor-affiliates that filed separate Chapter 11 petitions
March 1, 2010:
(1) Grand Court Villas, LLC
Case No: 10-15850
Estimated Assets: $1,000,000 to $10,000,000
Estimated Debts: $1,000,000 to $10,000,000
(2) Washington Crossing, LLC
Case No: 10-15852
Estimated Assets: $1,000,000 to $10,000,000
Estimated Debts: $1,000,000 to $10,000,000
Debtor-affiliates that filed separate Chapter 11 petitions
August 19, 2009:
(1) Carteret Arms, LLC
Case No: 09-31726
(2) Carteret Arms Management, LLC
Case No: 09-31728
MAGNA ENTERTAINMENT: Exclusive Solicitation Period Until April 30
-----------------------------------------------------------------
Michael Bathon at Bloomberg News reports that Magna Entertainment
Corp. won an extension until April 30 of its exclusive period to
propose and solicit acceptances of a Chapter 11 plan.
"The April 30 date is a very aggressive date considering the
regulatory approval needed" under the company's reorganization
plan submitted last month, William Ford, Magna's general counsel,
said to Michael G. Gallerizzo, attorney for creditor PNC Bank NA,
regarding questions about the target date for completing the
restructuring, Bloomberg's Michael Bathon reported.
PNC Bank had objected to the requested extension. Magna had
earlier proposed an April 29 extension of its plan proposal period
and a June 29 extension of the solicitation period.
Magna Entertainment and its units will seek approval on March 23
of the disclosure statement explaining their proposed plan of
reorganization. Magna will be able to commence soliciting votes
on, then seek confirmation of the Plan, following approval of the
Disclosure Statement.
MI Developments Inc. and the Official Committee of Unsecured
Creditors of MEC serve as co-proponents of the Plan.
The backbone of the Plan is a settlement of the lawsuit commenced
by the Creditors Committee against, among others, MID and MEC. The
Creditors Committee had commenced an adversary proceeding against
MID Islandi sf., the Debtors' largest prepetition secured lender,
MI Developments Inc., Magna Entertainment's controlling
shareholder, and certain other third party defendants asserting,
among other things, claims of fraudulent transfer, equitable
subordination, recharacterization and breaches of fiduciary duty.
The plan proponents have entered into a Support Agreement pursuant
to which, among other things, MID and the Committee agreed to
support the Plan and MEC agreed to seek approval of the Disclosure
Statement in the Bankruptcy Court on or prior to March 31 and
obtain confirmation of the Plan by the Bankruptcy Court on or
prior to April 30. The Support Agreement may be terminated if,
among other things, the Bankruptcy Court denies confirmation of
the Plan.
A copy of the Plan is available for free at:
http://bankrupt.com/misc/Magna_Ch11Plan_Feb18.pdf
A copy of the Disclosure Statement is available for free at:
http://bankrupt.com/misc/Magna_DiscStatement_Feb18.pdf
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 $1.054 billion and
total liabilities of $947.3 million based on unaudited
consolidated financial statements as of December 31, 2008.
MAGNA ENTERTAINMENT: Wants to Access $7 Mil. from MI Development
----------------------------------------------------------------
Randall Chase at The Associated Press reports that Magna
Entertainment Corp. said it wants to access $7 million in
financing from MI Developments because of liquidity issues because
of an unexpected decline in horse racing revenues and weather-
related race cancellations at Santa Anita Park in California.
The Company said it needs more funds as it works to emerge from
Chapter 11 protection.
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 $1.054 billion and
total liabilities of $947.3 million based on unaudited
consolidated financial statements as of December 31, 2008.
MAJESTIC STAR: Awaiting Bridge & Gaming Law; Seeks Plan Extension
-----------------------------------------------------------------
The Majestic Star Casino, LLC, and its units ask the Bankruptcy
Court to extend their exclusive period to propose a Chapter 11
plan until June 21 and their exclusive period to solicit
acceptances of that plan until August 19.
The official committee of unsecured creditors and the creditors
under the prepetition first lien obligations are not objecting to
the 90-day extension.
The Debtors own and operate four casino properties, two of which
are the Majestic Star I and Majestic Star II riverboat casinos
located at Buffington Harbor in Gar, Indiana.
Majestic Star says it has been engaged in negotiations regarding
the Indiana Gaming Commission's request for the Debtors to execute
a power of attorney authorizing IGC to appoint a trustee to
operate the licensed casinos in certain circumstances. The
Debtors are required to submit the POA or face the possibility
that the IGC may not renew the Debtors' gaming licenses in 2010.
In addition, the Indiana Department of Transportation ordered a
stretch of elevated highway known as the Cline Avenue Bridge,
which is the primary roadway used by customers to access Majestic
Star I and II from the Chicago metropolitan area, to be closed due
to structural damage. The unanticipated closure has resulted in a
decline in revenue at Majestic Star I and II. As a result of
greater travel time to Majestic Star I and II, customers who once
patronized Majestic Star I and II may now elect to take their
business to a competitor that is more conveniently located.
To combat the unanticipated and indefinite closure of Cline
Avenue, the Debtors have recently instituted various and
aggressive marketing strategies. However, since the new and
aggressive marketing strategies were just recently implemented, it
is unclear as to what portion of the lost revenues can be
recovered.
As of February 1, 2010, a total of 13 gaming-related bills were
pending in the Indiana General Assembly, and issues raised by one
bill in particular -- Senate Bill No. 405 -- could have a direct
and material impact on the Debtors' valuation of Majestic Star I
and II and the gaming licenses associated therewith. One version
would allow the Debtors to exchange two riverboat licenses for a
single land-based license without having to pay a $50 million
relocation fee. The current legislative session in Indiana is
scheduled to end on March 14, 2010, at which time the Debtors will
be able to better assess the immediate impact, if any, of the
pending legislation on Majestic Star I and II.
About Majestic Star
The Majestic Star Casino, LLC -- aka Majestic Star Casino, aka
Majestic Star -- is based in Las Vegas, Nevada. It is a wholly
owned subsidiary of Majestic Holdco, LLC, which is a wholly owned
subsidiary of Barden Development, Inc. The Company was formed on
December 8, 1993, as an Indiana limited liability company to
provide gaming and related entertainment to the public. The
Company commenced gaming operations in the City of Gary at
Buffington Harbor, located in Lake County, Indiana on June 7,
1996. The Company is a multi-jurisdictional gaming company with
operations in three states -- Indiana, Mississippi and Colorado.
The Company filed for Chapter 11 bankruptcy protection on
November 23, 2009 (Bankr. D. Delaware Case No. 09-14136).
The Company's affiliates -- The Majestic Star Casino II, Inc., The
Majestic Star Casino Capital Corp., Majestic Star Casino Capital
Corp. II, Barden Mississippi Gaming, LLC, Barden Colorado Gaming,
LLC, Majestic Holdco, LLC, and Majestic Star Holdco, Inc. -- also
filed separate Chapter 11 petitions.
Kirkland & Ellis LLP is the Debtors' bankruptcy counsel. James E.
O'Neill, Esq., Laura Davis Jones, Esq., and Timothy P. Cairns,
Esq., at Pachulski Stang Ziehl & Jones LLP are the Debtors'
Delaware counsel. Xroads Solutions Group, LLC, is the Debtors'
financial advisor, while EPIQ Bankruptcy Solutions LLC are the
Debtors' claims and notice agent.
The Majestic Star Casino, LLC's balance sheet at June 30, 2009,
showed total assets of $406.42 million and total liabilities of
$749.55 million. When it filed for bankruptcy, the Company listed
up to $500 million in assets and up to $1 billion in debts.
MALITA REALTORS: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Malita Realtors, LLC
8414 Torresdale Avenue
Philadelphia, PA 19136
Bankruptcy Case No.: 10-11543
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Eastern District of Pennsylvania (Philadelphia)
Judge: Eric L. Frank
Debtor's Counsel: Steven D. Usdin, Esq.
Cohen Seglias Pallas Greenhall & Furman
United Plaza
30 South 17th Street, 19th Floor
Philadelphia, PA 19103
Tel: (215) 564-1700
Fax: (267) 238-4408
Email: susdin@cohenseglias.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor did not file a list of its 20 largest unsecured
creditors when it filed its petition.
The petition was signed by Varghese Thomas, managing member of the
Company.
MALUHIA DEV'T: Files Schedules of Assets & Liabilities
------------------------------------------------------
Maluhia Development Group, LLC, has filed with the U.S. Bankruptcy
Court for the Northern District of Texas its schedules of assets
and liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ------ -----------
A. Real Property $0
B. Personal Property $14,734,422
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $1,418,353
E. Creditors Holding
Unsecured Priority
Claims $0
F. Creditors Holding
Unsecured Non-priority
Claims $15,225,636
------------- ------------
TOTAL $14,734,422 $16,643,988
Chicago, Illinois-based Maluhia Development Group, LLC, dba MDG,
filed for Chapter 11 bankruptcy protection on January 21, 2010
(Bankr. N.D. Texas Case No. 10-30475). Rakhee V. Patel, Esq., at
Pronske & Patel, P.C., assists the Company in its restructuring
effort. The Company listed $1,000,001 to $10,000,000 in assets
and $10,000,001 to $50,000,000 in liabilities.
MBIA INSURANCE: S&P Junks Preferred Stock Rating From 'B+'
----------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its ratings on
MBIA Insurance Corp.'s preferred stock to 'C' from 'B+' in light
of the announced deferral of dividends.
An increase in statutory loss reserves for MBIA in the fourth
quarter of 2009 resulted in negative earned surplus. Under New
York State Insurance Department regulation, the company is
prohibited from paying dividends on its preferred stock while its
earned surplus is negative.
Standard & Poor's assigns a 'C' rating for types of nonpayment
that are permitted under the terms of the instrument to more
clearly distinguish these from cases that constitute events of
default, for which holders have specified remedies.
Ratings List
MBIA Insurance Corp.
Counterparty Credit Rating BB+/Negative/--
Downgraded
MBIA Insurance Corp.
To From
-- ----
Preferred Stock C B+
MC PRECAST: Taps Scroggins and Williamson as Bankruptcy Counsel
---------------------------------------------------------------
Mc Precast, Inc., asks the U.S. Bankruptcy Court for the Northern
District of Georgia for permission to employ Scroggins and
Williamson as counsel.
Scroggins and Williamson will, among other things:
-- prepare pleadings and applications;
-- conduct examinations; and
-- advise the Debtor of its rights, duties and obligations as
debtor-in-possession.
J. Robert Williamson, Esq., a member of Scroggins and Williamson,
tells the Court that the firm received a $50,000 retainer from the
proceeds of postpetition financing provided by Atlantic Capital
Bank. Mr. Williamson adds that the firm agreed to waive the
$5,238 prepetition claim as a condition of its retention as the
Debtor's counsel as of the petition date.
The hourly rate of the firm's personnel are:
Attorneys $270 - $395
Paralegals $75 - $125
Mr. Williamson assures the Court that Scroggins and Williamson is
a "disinterested person" as that term is defined in Section
101(14) of the Bankruptcy Code.
Mr. Williamson can be reached at:
Scroggins and Williamson
1500 Candler Building
127 Peachtree Street, N.E.
Atlanta, GA 30303
Tel: (404) 893-3880
Newnan, Georgia-based MC Precast, Inc., filed for Chapter 11
bankruptcy protection on February 8, 2010 (Bankr. N.D. Ga. Case
No. 10-10466). J. Robert Williamson, Esq., at Scroggins and
Williamson, assists the Company in its restructuring effort. The
Company listed $10,000,001 to $50,000,000 in assets and
$10,000,001 to $50,000,000 in liabilities.
MEDIACOM COMMS: Swings to $697-Mil. Income in Q4 of 2009
--------------------------------------------------------
Mediacom Communications Corporation reported $697.29 million net
income for the three months ended Dec. 31, 2009, compared with
$69.98 million net loss for the same period a year ago.
The Company posted $3.97 billion in total assets and $3.71 billion
in total liabilities at Dec. 31, 2009.
A full-text copy of the Company's annual report on Form 10-K is
available for free at http://ResearchArchives.com/t/s?5678
Based in Middletown, New York, Mediacom Communications Corporation
(Nasdaq: MCCC) -- http://www.mediacomcc.com/-- is the nation's
eighth largest cable television company and one of the leading
cable operators focused on serving the smaller cities and towns in
the United States. Mediacom Communications offers a wide array of
broadband products and services, including traditional video
services, digital television, video-on-demand, digital video
recorders, high-definition television, high-speed data access and
phone service.
At Dec. 31, 2008, the Company had assets of $3.72 billion compared
with debts of $4.06 billion, for a stockholders' deficit of $346.6
million.
MELLCO INC: Case Summary & 3 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: Mellco, Inc.
PO Box 605
Perry, GA 31069
Bankruptcy Case No.: 10-50654
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Middle District of Georgia (Macon)
Debtor's Counsel: Wesley J. Boyer, Esq.
Katz, Flatau, Popson and Boyer, LLP
355 Cotton Avenue
Macon, GA 31201
Tel: (478) 742-6481
Email: wjboyer_2000@yahoo.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including a list of its
3 largest unsecured creditors, is available for free at:
http://bankrupt.com/misc/gamb10-50654.pdf
The petition was signed by Mell S. Tolleson Jr., CEO/CFO/secretary
the Company.
MERIDIAN RESOURCE: Amends Employment Agreement with CEO
-------------------------------------------------------
The Meridian Resource Corporation and Paul D. Ching entered into
an amendment to Mr. Ching's Employment Agreement with the Company.
Mr. Ching has served as President and Chief Executive Officer of
the Company since Dec. 30, 2008, under an Employment Agreement
that originally provided for a term expiring June 30, 2009. On
June 4, 2009, the Company and Mr. Ching entered into an amendment
to the Employment Agreement that extended the term of the
Employment Agreement to December 31, 2009.
Amendment was retroactively effective to Dec. 31, 2009, and
extends the term of the Employment Agreement to March 31, 2010,
unless earlier terminated in accordance with the terms of the
Employment Agreement.
A full-text copy of the company's Employment Agreement with Paul
D. Ching is available for free at
http://ResearchArchives.com/t/s?5604
About Meridian Resource
Based in Houston, Texas, The Meridian Resource Corporation
(NYSE:TMR) -- http://www.tmrc.com/-- is an independent oil and
natural gas company engaged in the exploration, exploitation,
acquisition and development of oil and natural gas in Louisiana,
Texas, and the Gulf of Mexico. Meridian has access to an
extensive inventory of seismic data and, among independent
producers, is a leader in using 3-D seismic and other technologies
to analyze prospects, define risk, target and complete high-
potential wells for exploration and development. Meridian has a
field office in Weeks Island, Louisiana.
At September 30, 2009, the Company had $190,339,000 in total
assets, including $18,090,000 in total current assets, against
$120,634,000 in total current liabilities and $17,736,000 in asset
retirement obligations.
The Company noted that its default under the debt agreements,
which has been mitigated in the short term by certain forbearance
agreements, negatively impacts future cash flow and the Company's
access to credit or other forms of capital. There is substantial
doubt as to the Company's ability to continue as a going concern
for a period longer than the next 12 months, the Company said.
It added that it might have to seek protection under federal
bankruptcy laws if it is unable to comply with the forbearance
agreements or if those agreements expire.
MESA AIR: Gets Nod to Enter Into Sec. 1110(a) Stipulations
----------------------------------------------------------
Mesa Air Group Inc. and its received approval from the Bankruptcy
Court to establish procedures authorizing them to perform
obligations and cure defaults pursuant to Section 1110(a) of the
Bankruptcy Code, and to enter into agreements to extend the 60-day
period specified in Section 1110(a).
The Debotrs currently maintain a fleet of approximately 178
aircraft. Substantially all of the aircraft, related engines and
other equipment in the Debtors' fleet are subject to leases or
financing arrangements that may be subject to the provisions of
Section 1110 of the Bankruptcy Code.
According to Maria A. Bove, Esq., at Pachulski Stang Ziehl &
Jones LLP, in New York, the fleet is too large for the Debtors'
operations. Approximately 52 aircraft are parked and not being
used. In addition, over the next several months, the Debtors
plan to retire additional aircraft that are not needed to service
their customers. By contrast, Ms. Bove relates that the Debtors
do not anticipate any reduction of the portion of their Fleet that
is CRJ-700s and CRJ-900s aircraft.
Various parties objection to the proposed Sec. 1110 procedures.
However, after extensive negotiations, the Debtors reached
agreement with 26 parties as to a modified form of order on the
Motion, whereby the Debtors undertake to take certain surrender
and return-related and other actions, while various material
rights of affected parties-in-interest to seek additional relief
or assert related claims against the Debtors are expressly
preserved.
The parties include the Official Committee of Unsecured
Creditors; GE Capital Aviation Services; Bank of Scotland, plc;
CIT Capital USA Inc.; Export Development Canada; Bombardier Inc.,
Bombardier Capital Inc. and Bombardier Services Corporation; Bank
of Hawaii; and United Airlines.
Among other things, the Debtors are authorized to agree to
perform all of their obligations under the relevant Aircraft
Agreements pursuant to Section 1110(a) of the Bankruptcy Code,
and to enter into agreements pursuant to Section 1110(b) of the
Bankruptcy Code to extend the 60-day period under Section
1110(a)(2). All agreements pursuant to Section 1110(a) will be
immediately effective pursuant to the terms of this Order. All
agreements pursuant to Section 1110(b) will be immediately
effective, but will be subject to final approval of the Court.
A full-text copy of the order is available at no charge at:
http://bankrupt.com/misc/Mesa_OrdSec1110Stip022310.pdf
About Mesa Air Group
Mesa currently operates 130 aircraft with approximately 700 daily
system departures to 127 cities, 41 states, Canada, and Mexico.
Mesa operates as Delta Connection, US Airways Express and United
Express under contractual agreements with Delta Air Lines, US
Airways and United Airlines, respectively, and independently as
Mesa Airlines and go! Mokulele. This operation links Honolulu to
the neighbor island airports of Hilo, Kahului, Kona and Lihue. The
Company, founded by Larry and Janie Risley in New Mexico in 1982,
has approximately 3,500 employees.
Mesa Air Group Inc. and its units filed their Chapter 11 petitions
Jan. 5 in New York (Bankr. S.D.N.Y. Case No. 10-10018), listing
assets of $976 million against debt totaling $869 million as of
Sept. 30, 2009.
Richard M. Pachulski, Esq., and Laura Davis Jones, Esq., at
Pachulski Stang Ziehl & Jones LLP, serve as local counsel.
Imperial Capital LLC is the investment banker. Epiq Bankruptcy
Solutions is claims and notice agent.
Bankruptcy Creditors' Service, Inc., publishes Mesa Air Bankruptcy
News. The newsletter tracks the Chapter 11 proceedings undertaken
by Mesa Air Group Inc. and its units.
(http://bankrupt.com/newsstand/or 215/945-7000)
MESA AIR: Plane Leases Rejection Protocol Approved
--------------------------------------------------
Pursuant to Sections 105(a), 363(b), 365(a), 554(a) and 1110 of
the Bankruptcy Code and Rules 6004, 6006 and 6007 of the Federal
Rules of Bankruptcy Procedure, Mesa Air Group Inc. and its units
obtained from the Bankruptcy Court authority to reject executory
contracts and unexpired leases relating to aircraft and other
related equipment, which are no longer necessary, pursuant to
certain rejection procedures.
Various parties, including Cargill, Incorporated, as assignee of
Cargill Leasing Corporation, the owner participant with respect
to a certain Havilland DHC 8-200 aircraft, objection to the
proposed rejection procedures.
After extensive negotiations, the Debtors reached agreements with
26 parties as to a modified form of order on the Motion,
whereby the Debtors undertake to take certain surrender and
return-related and other actions, while various material rights
of affected parties-in-interest to seek additional relief or
assert related claims against the Debtors are expressly
preserved.
The parties include the Official Committee of Unsecured
Creditors; GE Capital Aviation Services; Bank of Scotland, plc;
CIT Capital USA Inc.; Export Development Canada; Bombardier Inc.,
Bombardier Capital Inc. and Bombardier Services Corporation; Bank
of Hawaii; and United Airlines.
A full-text copy of the Court's order on the rejection protocol is
available at no charge at:
http://bankrupt.com/misc/Mesa_OrdRejAircLeases022310.pdf
The list of Excess Leased Equipment, which is available for free
at http://bankrupt.com/misc/Mesa_AmExcLeasedEqpt022410.pdf
First Rejection Notice
On February 24, 2010, the Debtors filed their first notice of
intent to reject five leases relating to certain aircraft engines
pursuant to the Procedures. A list of the Leases to be rejected
is available at no charge at:
http://bankrupt.com/misc/Mesa_1stNoticeRejAircLease022410.pdf
Unless an affected Aircraft Party timely objects to the Notice
and proposed Lease rejection and related surrender and return of
the Excess Leased Equipment, the rejection of the Lease will be
effective on March 8, 2010, without need of any further Court
order or additional notice.
About Mesa Air Group
Mesa currently operates 130 aircraft with approximately 700 daily
system departures to 127 cities, 41 states, Canada, and Mexico.
Mesa operates as Delta Connection, US Airways Express and United
Express under contractual agreements with Delta Air Lines, US
Airways and United Airlines, respectively, and independently as
Mesa Airlines and go! Mokulele. This operation links Honolulu to
the neighbor island airports of Hilo, Kahului, Kona and Lihue. The
Company, founded by Larry and Janie Risley in New Mexico in 1982,
has approximately 3,500 employees.
Mesa Air Group Inc. and its units filed their Chapter 11 petitions
Jan. 5 in New York (Bankr. S.D.N.Y. Case No. 10-10018), listing
assets of $976 million against debt totaling $869 million as of
Sept. 30, 2009.
Richard M. Pachulski, Esq., and Laura Davis Jones, Esq., at
Pachulski Stang Ziehl & Jones LLP, serve as local counsel.
Imperial Capital LLC is the investment banker. Epiq Bankruptcy
Solutions is claims and notice agent.
Bankruptcy Creditors' Service, Inc., publishes Mesa Air Bankruptcy
News. The newsletter tracks the Chapter 11 proceedings undertaken
by Mesa Air Group Inc. and its units.
(http://bankrupt.com/newsstand/or 215/945-7000)
MESA AIR: Wants Waiver From Sec. 345 Rules for Mexico Accounts
--------------------------------------------------------------
Mesa Air, Inc., and its debtor affiliates seek a waiver from
Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern
District of New York of the requirements of Section 345 of the
Bankruptcy Code solely with respect to their bank accounts
located in Mexico.
Michael J. Lotz, the Debtors' president, relates that the Debtors
maintain stations -- airport location staffed by their employees
-- in Mexico under their code share agreement with US Airways,
Inc. The US Air code share agreement requires the Debtors to
operate and provide services in Mexico.
The Debtors established five bank accounts with two separate
banks in Mexico to collect revenues and pay related expenses.
Two of the Mexico Accounts are located at Banco Nacional de
Mexico S.A., and the other three accounts at Banco Mercantil del
Norte S.A. The accounts are part of the Debtors' Cash Management
System.
Most of the Debtors' ticket sale proceeds derived from US Air-
related flights are deposited directly into a US Air-controlled
deposit account. As a result, the Debtors' only source of
revenue or cash collection at its Mexico stations are de minimis
fees and taxes associated with employee guest flight passes,
which revenue is deposited into the Debtors' collection account
at Banco Nacional on a daily basis, Mr. Lotz informs the Court.
The average monthly balance of the Nacional Collection Account is
small, up to $4,000, and is swept into the Debtors' main
operating account on a manual basis when balance restrictions
permit the Debtors to transfer excess funds. The Debtors sweep
the Nacional Collection Account every quarter, according to Mr.
Lotz.
Payroll and other routine expenses associated with the operation
of the Mexico stations are deducted from the Debtors'
disbursement account at Banco Nacional. To fund the Nacional
Expense Account, the Debtors wire funds from the Main
Concentration Account to their dollar account at Banco Mercantil.
The amount varies from month to month but is generally
approximately $100,000 to $300,000. The funds in the Mercantil
Dollar Account are converted to pesos and are deposited into the
Debtors' peso account at Banco Mercantil. The funds in the
Mercantil Peso Account are transferred weekly to the Nacional
Expense Account in amounts necessary to fund the Debtors'
accounts payable.
The Mercantil Peso Account is also linked to an investment
account located at Banco Mercantil. Excess funds in the
Mercantil Peso Account are swept into the Mexico Money Market
Account, which is an interest-bearing account, the rate of which
is determined by the investments made by Banco Mercantil.
According to Mr. Lotz, when funds are transferred from the Main
Concentration Account to the Mexico Accounts, the balances in the
Mexico Accounts are quickly reduced because the Debtors use the
funds to satisfy outstanding expenses due and payable. As a
result, the Debtors generally keep less than $300,000 in the
Mexico Accounts for any significant period of time.
Mr. Lotz notes that under Mexican law, companies operating in
Mexico are required to obtain a tax identification number and
comply with various fiscal policies. In addition, a settlement
of a company's accounts payable must be reconciled through a
Mexico-based bank.
The Debtors are also subject to certain taxes assessed by the
non-immigrant tax, the immigrations services tax, and the airport
facility fee, which cannot be satisfied from a transfer
originating in the United States, Mr. Lotz says.
It would not only be impracticable to close the Mexico Accounts
but also impossible, because the Debtors are continuing to
operate in Mexico, and must continue these operations under the
US Air code share agreement, Mr. Lotz tells the Court. Moreover,
the funds in the Mexico Accounts are sufficiently secured by the
manner in which the Debtors utilize the accounts and the
protections afforded by Mexico's banking laws, he adds.
After the Motion was filed, the Debtors inquired as to whether
they could obtain a bond to secure the amounts on deposit in the
Mexico Accounts. Unfortunately, the bonding agency informed the
Debtors that it would not issue a bond unless the Debtors posted
a cash deposit in the full amount of the bond in order to secure
the bonding agency's obligations, Mr. Lotz relates.
In addition to posting 100% of the amount of the bond collateral,
the Debtors would have to pay a bond fee as well as an additional
fee to establish and maintain a letter of credit in favor of the
bonding agency. Mr. Lotz believes that tying up the estates'
cash, in the amount of 100% of the amounts on deposit to the
Mexico Accounts, in addition to payments of the bond fee and
letter of credit fee, is not in the estates' best interests,
especially given the de minimis amounts on deposit in the
Mexico Accounts, and given the existing protections that minimize
any risk of less funds deposited in the Mexico Accounts.
About Mesa Air Group
Mesa currently operates 130 aircraft with approximately 700 daily
system departures to 127 cities, 41 states, Canada, and Mexico.
Mesa operates as Delta Connection, US Airways Express and United
Express under contractual agreements with Delta Air Lines, US
Airways and United Airlines, respectively, and independently as
Mesa Airlines and go! Mokulele. This operation links Honolulu to
the neighbor island airports of Hilo, Kahului, Kona and Lihue. The
Company, founded by Larry and Janie Risley in New Mexico in 1982,
has approximately 3,500 employees.
Mesa Air Group Inc. and its units filed their Chapter 11 petitions
Jan. 5 in New York (Bankr. S.D.N.Y. Case No. 10-10018), listing
assets of $976 million against debt totaling $869 million as of
Sept. 30, 2009.
Richard M. Pachulski, Esq., and Laura Davis Jones, Esq., at
Pachulski Stang Ziehl & Jones LLP, serve as local counsel.
Imperial Capital LLC is the investment banker. Epiq Bankruptcy
Solutions is claims and notice agent.
Bankruptcy Creditors' Service, Inc., publishes Mesa Air Bankruptcy
News. The newsletter tracks the Chapter 11 proceedings undertaken
by Mesa Air Group Inc. and its units.
(http://bankrupt.com/newsstand/or 215/945-7000)
MHG CASA: MetWest SIMA Acquires Casa Madrona Hotel
--------------------------------------------------
Kris Hudson and Lingling Wei at The Wall Street Journal report
that MetWest SIMA Real Estate Advisors of Santa Barbara,
California, acquired Casa Madrona Hotel with a bid of $1 more than
the Federal Deposit Insurance Corp.'s asking price of $11.4
million at a foreclosure auction last month.
The Journal also relates Casa Madrona Hotel Spa in Sausalito,
California, is at the center of an FDIC investigation of Integrity
Bank. Integrity was seized by banking regulators in August 2008
after lending all its capital to the hotel's owner, commercial-
real-estate developer Guy Mitchell.
Miami, Florida-based MHG Casa Madrona Hotel, LLC, operates a
lodging business. The Company filed for Chapter 11 on Aug. 10,
2009 (Bankr. N.D. Calif. Case No. 09-12536). Tracy Green, Esq.,
at Wendel, Rosen, Black and Dean, represents the Debtor in its
restructuring efforts. In its petition, the Debtor listed assets
and debts both ranging from $10,000,001 to $50,000,000.
MILESTONE SCIENTIFIC: K. Tucker Andersen Reports 18.2% Stake
------------------------------------------------------------
K. Tucker Andersen, c/o Cumberland Associates LLC, in New York,
disclosed that he may be deemed to be beneficially owned 2,686,230
shares of Milestone Scientific Inc., which includes:
(i) 100,000 Shares issuable upon the exercise of options,
which are currently exercisable at $1.51 per share;
(ii) 130,000 Shares issuable upon the exercise of warrants,
which are currently exercisable at $5.00 per share; and
(iii) 45,000 Shares issuable upon the exercise of warrants,
which are currently exercisable at $0.32 per share.
The Shares held represent approximately 18.2% of the total
outstanding Shares.
On January 24, 2007, the Company issued to Mr. Andersen options to
purchase 100,000 Shares at $1.51 per Share pursuant to the
Company's 2004 Stock Option Plan in payment for services rendered
to the Company by Mr. Andersen. Between September 5, 2007, and
May 14, 2008, the Company issued to Mr. Andersen warrants to
purchase an aggregate of 130,000 Shares at $5.00 per Share
pursuant to a $1,300,000 Revolving Line of Credit Promissory Note,
dated as of June 28, 2007 and amended in April 2008, entered into
by the Company for the benefit of Mr. Andersen.
On December 27, 2008, the Company issued to Mr. Andersen warrants
to purchase 45,000 Shares at $0.32 per Share pursuant to a
$450,000 Promissory Note, dated December 27, 2008, entered into by
the Company for the benefit of Mr. Andersen. On September 21,
2009, the Company issued 100,000 Shares to Mr. Andersen in payment
for consulting services rendered to the Company by Mr. Andersen.
On December 28, 2009, the Company issued 822,785 Shares to Mr.
Andersen upon conversion of Mr. Andersen's $1,300,000 Revolving
Line of Credit Promissory Note. None of the transactions were
paid for with borrowed funds or funds obtained for the purpose of
acquiring, holding, trading or voting the securities.
Mr. Andersen is a self-employed independent investor and business
consultant.
About Milestone Scientific
Milestone Scientific Inc. is engaged in pioneering proprietary,
highly innovative technological systems and solutions for the
medical and dental markets. From its inception, the Company has
focused its energy and resources on redefining the global standard
of care for injection techniques by making the experience more
comfortable for the patient and by reducing the anxiety and stress
of giving injections for the healthcare provider.
As of September 30, 2009, the Company had total assets of
$3,900,447 against total current liabilities of $2,691,538 and
total long-term liabilities of $438,144, resulting in
stockholders' equity of $770,765. At December 31, 2008,
stockholders' equity was $1,400,180.
Going Concern Doubt
In its Form 10-Q report for the September 30, 2009 quarterly
period, the Company said it has incurred operating losses and
negative cash flows from operating activities since its inception,
including a net loss of $1,591,454 and $1,275,735 for the nine
months ended September 30, 2009 and 2008, respectively. At
September 30, 2009, the Company had cash and cash equivalents of
$497,455 and negative working capital of $406,968. The working
capital is negative by the inclusion in current liabilities as of
September 30, 2009, of the $1,300,000 line of credit, due June 30,
2010.
The Company secured a revolving line of credit in the aggregate
amount of $1.3 million from a stockholder, which was fully
borrowed at December 31, 2008. All borrowings and interest
thereon must be repaid by June 30, 2010, and after the expiration
date of the line, may be repaid by Milestone in cash or, at its
option, in shares of common stock.
The Company also borrowed $450,000 in 2008 from the same
shareholder, with an original due date of January 2009. This
additional borrowing was refinanced at December 31, 2008, and the
due date was extended to June 30, 2012.
The Company said it is actively pursuing the generation of
positive cash flows from operating activities through an increase
in revenue based upon management's assessment of present contracts
and current negotiations and reductions in operating expenses. If
the Company is unable to generate positive cash flows from its
operating activities, it will need to raise additional capital.
There is no assurance that the Company will be able to achieve
positive operating cash flows or that additional capital can be
raised on terms and conditions satisfactory to the Company, if at
all. If additional capital is required and it cannot be raised,
then the Company would be forced to curtail its development
activities, reduce marketing expenses for existing dental products
or adopt other cost saving measures, any of which might negatively
affect the Company's operating results.
The Company said its recurring losses and negative operating cash
flows raises substantial doubt about its ability to continue as a
going concern.
MILESTONE SCIENTIFIC: Leonard Osser Reports 15.5% Stake
-------------------------------------------------------
Leonard Osser disclosed that he is deemed to beneficially own
2,283,253 shares, representing 15.5% of the outstanding shares, of
Milestone Scientific Inc. common stock. Mr. Osser is the Chief
Executive Officer and a director of the Company.
The Company granted options to Mr. Osser to purchase 253,164
Shares at a price of $1.74 per Share pursuant to Mr. Osser's
Employment Agreement with the Company. Between 2005 and 2009, Mr.
Osser also earned an aggregate of 676,676 Shares at prices ranging
from $0.55 to $1.78 per Share, pursuant to his Employment
Agreement with the Company, though the 676,676 Shares will not be
issued until after his employment with the Company terminates.
None of these transactions were paid for with borrowed funds or
funds obtained for the purpose of acquiring, holding, trading or
voting the securities.
About Milestone Scientific
Milestone Scientific Inc. is engaged in pioneering proprietary,
highly innovative technological systems and solutions for the
medical and dental markets. From its inception, the Company has
focused its energy and resources on redefining the global standard
of care for injection techniques by making the experience more
comfortable for the patient and by reducing the anxiety and stress
of giving injections for the healthcare provider.
As of September 30, 2009, the Company had total assets of
$3,900,447 against total current liabilities of $2,691,538 and
total long-term liabilities of $438,144, resulting in
stockholders' equity of $770,765. At December 31, 2008,
stockholders' equity was $1,400,180.
Going Concern Doubt
In its Form 10-Q report for the September 30, 2009 quarterly
period, the Company said it has incurred operating losses and
negative cash flows from operating activities since its inception,
including a net loss of $1,591,454 and $1,275,735 for the nine
months ended September 30, 2009 and 2008, respectively. At
September 30, 2009, the Company had cash and cash equivalents of
$497,455 and negative working capital of $406,968. The working
capital is negative by the inclusion in current liabilities as of
September 30, 2009, of the $1,300,000 line of credit, due June 30,
2010.
The Company secured a revolving line of credit in the aggregate
amount of $1.3 million from a stockholder, which was fully
borrowed at December 31, 2008. All borrowings and interest
thereon must be repaid by June 30, 2010, and after the expiration
date of the line, may be repaid by Milestone in cash or, at its
option, in shares of common stock.
The Company also borrowed $450,000 in 2008 from the same
shareholder, with an original due date of January 2009. This
additional borrowing was refinanced at December 31, 2008, and the
due date was extended to June 30, 2012.
The Company said it is actively pursuing the generation of
positive cash flows from operating activities through an increase
in revenue based upon management's assessment of present contracts
and current negotiations and reductions in operating expenses. If
the Company is unable to generate positive cash flows from its
operating activities, it will need to raise additional capital.
There is no assurance that the Company will be able to achieve
positive operating cash flows or that additional capital can be
raised on terms and conditions satisfactory to the Company, if at
all. If additional capital is required and it cannot be raised,
then the Company would be forced to curtail its development
activities, reduce marketing expenses for existing dental products
or adopt other cost saving measures, any of which might negatively
affect the Company's operating results.
The Company said its recurring losses and negative operating cash
flows raises substantial doubt about its ability to continue as a
going concern.
MILLIPORE CORP: Acquisition Cues S&P to Cut Merck's Ratings
------------------------------------------------------------
Standard & Poor's Ratings Services said that it lowered its long-
term corporate credit and senior unsecured debt ratings on
Germany-based pharmaceuticals and specialty chemicals producer
Merck KGaA to 'BBB+' from 'A-'. At the same time, S&P affirmed
the short-term rating of 'A-2'. The outlook is stable.
On Feb. 28, 2010, Merck announced that it will conduct a fully
debt-financed acquisition of the U.S.-based life science company
Millipore Corp. (BB+/Positive/--) for approximately
EUR5.3 billion.
"The rating action reflects that as a consequence of this
acquisition S&P anticipate that Merck's debt protection metrics
will be significantly weaker for the next three years and, as
such, no longer view them as commensurate with an 'A-' rating,"
said Standard & Poor's credit analyst Marketa Horkova.
Although the transaction will not materially affect the group's
already "strong" business risk profile, it will lower the Standard
& Poor's-adjusted ratio of FFO to debt to about 20% by the end of
2010, with an improvement to over 30% by the year end 2011. As
such, Merck would more than exhaust its flexibility for the former
ratings.
Following the announced acquisition, S&P has revised Merck's
financial risk profile to "intermediate" from "modest", reflecting
management's greater willingness to incur additional debt and to
temporarily accept a more highly geared balance sheet. The
group's cash-generation is likely to be strong in the next few
years: S&P anticipates the combined entity will generate free cash
flow before dividends and share buybacks of more than EUR1 billion
annually in the medium-term. Despite this, the additional debt
related to the acquisition will, in S&P's view, weigh heavily on
Merck's credit metrics in the near future.
"The stable outlook assumes the continuous improvement of Merck's
credit protection measures such that they become commensurate with
the ratings. This would entail the Standard & Poor's-adjusted
ratio of FFO to net debt reaching 30% in the coming years," said
Ms. Horkova.
It also reflects S&P's view that Merck's operating performance
will be able to withstand the adverse consumer environment by
capitalizing on its strong pharmaceuticals market position and the
enhanced cash flow generation capabilities of the combined group,
which should enable the group to deleverage significantly in the
future, provided that management is willing to do so. However,
even small-to-midsize additional debt-financed acquisitions could
lead to a negative rating action. Ratings upside currently
appears remote.
MONEYGRAM INT'L: Earnings Report to Reflect Class Action Deal
-------------------------------------------------------------
MoneyGram International, Inc., on Monday said it will be making
certain adjustments to its consolidated financial statements to
reflect a class action settlement in accordance with generally
accepted accounting principles.
MoneyGram on February 4, 2010, issued an earnings release
reporting financial information for its fourth quarter and year
ended December 31, 2009. On February 25, 2010, the Company
announced that it had entered into memoranda of understanding to
settle federal securities class and stockholder derivative actions
pending against it in the United States District Court for the
District of Minnesota.
The memoranda of understanding revised the Company's estimate
regarding the probability that it had incurred a liability related
to the federal securities class and stockholder derivative actions
as of December 31, 2009, and provided a reasonable basis to
estimate that liability.
The Company said revised financial information will not be
available until it files its Annual Report on Form 10-K for the
year ended December 31, 2009. The Company anticipates filing by
the March 16, 2010 filing deadline.
2009 Financial Results
MoneyGram swung to a net income of $18.344 million for the year
ended December 31, 2009, from a net loss of $261.385 million for
year 2008. Net income for the fourth quarter of 2009 was
$28.124 million from $122.861 million for the same period in 2008.
Full-year total revenue in 2009 was $1.171 billion, up from
$927.1 million in 2008. Total revenue in 2008 included net
securities losses of $340.7 million and investment revenue that
was $128.9 million more favorable compared with 2009. Total
revenue in the fourth quarter 2009 was $296.4 million compared
with $319.0 million in the same period in 2008. Fourth quarter
2008 total revenue included net securities gains of $10.2 million
and investment revenue that was $27.6 million more favorable
compared with 2009.
At December 31, 2009, the Company had total assets of
$5.879 billion against $5.877 billion in total liabilities,
$864.328 million in mezzanine equity and $862.763 million in
stockholders' deficit.
In the fourth quarter of 2009, MoneyGram paid the remaining
$45.0 million outstanding on its revolving credit facility and
made a $40.0 million prepayment on its Senior Tranche B Loan under
its Senior Facility. In 2009, the Company paid down
$186.9 million, or 19%, of its total outstanding debt. The
Company ended the year with assets in excess of payment service
obligations of $313.3 million.
A full-text copy of the Company's earnings release is available at
no charge at http://ResearchArchives.com/t/s?555b
About MoneyGram International
Minneapolis, Minnesota, MoneyGram International (NYSE:MGI) --
http://www.moneygram.com/-- offers more control and more choices
for people separated by distance or with limited bank
relationships to meet their financial needs. MoneyGram helps
consumers to pay bills quickly and safely send money around the
world in as little as 10 minutes. Its global network is comprised
of 180,000 agent locations in nearly 190 countries and
territories. MoneyGram's convenient and reliable network includes
retailers, international post offices and financial institutions.
MOUNTAIN 1ST BANK: Agrees to Consent Order by FDIC
--------------------------------------------------
Effective February 25, 2010, Mountain 1st Bank & Trust Company, a
wholly owned subsidiary of 1st Financial Services Corporation,
agreed to the issuance of a Consent Order with the Federal Deposit
Insurance Corporation and the North Carolina Commissioner of
Banks.
1st Financial said in a filing with the Securities and Exchange
Commission that the Consent Order was entered into and became
effective on February 25, 2010, and the Bank was notified of the
Order's effectiveness on March 1, 2010.
Mike Mayer, the recently appointed Chief Executive Officer of the
Company and the Bank, stated: "Our Board of Directors and
management team are united in our efforts to satisfy the
requirements of the Consent Order in the coming months. We have
already fulfilled a number of the conditions for the release of
the Order. Our goal is to complete our return to good standing as
quickly as possible."
Mr. Mayer also said, "We continue to meet the applicable
regulatory capital requirements and we continue to meet the
banking needs of our customers and communities. We will not lose
our focus on achieving excellence in serving Western North
Carolina."
Although the Bank neither admitted nor denied any unsafe or
unsound banking practices or violations of law or regulation, it
agreed to the Consent Order, which requires it to undertake a
number of actions:
* The Board of Directors of the Bank will enhance its
supervision of the Bank's activities, including by increasing
the formality of its meetings and appointing a special
Directors' Committee. The Committee will oversee the efforts
of the Bank's management in complying with the Consent Order
and will regularly report to the full Board.
* The Bank Board will assess the Bank's management team to
ensure that the Bank's executive officers have the skills,
training, abilities and experience needed to cause the Bank
to comply with the Consent Order, operate in a safe and sound
manner, comply with applicable laws and regulations, and
strengthen all areas of the Bank's operations that are not
currently in compliance with the Consent Order. The Board
will also assess the Bank's management and staffing needs in
order to determine if additional resources should be added to
the management team.
* During the effectiveness of the Consent Order, the Bank will
maintain Tier 1 Capital of at least 8% of total assets, a
Total Risk Based Capital Ratio of at least 12% and a fully
funded allowance for loan and lease losses (the "allowance").
* The Bank will develop and implement a plan for achieving and
maintaining the foregoing capital levels, which plan may
include sales of stock by the Company and contributions of
the sales proceeds by the Company to the capital of the Bank.
* The Board will strengthen the allowance policy of the Bank,
periodically review the Bank's allowance to determine its
adequacy and enhance its periodic reviews of the allowance to
ensure its continuing adequacy. Deficiencies noted will be
promptly remedied by charges to earnings. In addition, the
allowance has been increased as required by the Consent
Order.
* The Bank will develop and implement a strategic plan covering
at least three years and containing long-term goals designed
to improve the condition of the Bank.
* The Bank charged off all of its assets (loans) classified
"Loss" and 50% of its assets (loans) classified "Doubtful"
promptly following the effectiveness of the Consent Order.
The Bank anticipates that the remainder of the "Doubtful"
assets (loans) will be charged off during the remainder of
2010.
* The Bank will not extend additional credit to any borrower
who had a loan with the Bank that was charged off or who has
a current loan that is classified "Loss" or "Doubtful". The
Bank also will not extend additional credit to any borrower
who has a current loan that is classified "Substandard" or
listed for "Special Mention." A further extension of credit
may be made to a borrower with a "Substandard" or "Special
Mention" loan if the Bank Board determines such extension
would be in the best interests of the Bank.
* The Bank will formulate a detailed plan to collect, charge
off or improve the quality of each of its "Substandard" or
"Doubtful" loans as of August 31, 2009, of more than $250,000
and will promptly implement the plan. The Board will closely
monitor the Bank's progress in fulfilling the requirements of
this plan.
* The Bank will reduce loans in excess of $250,000 and
classified as "Substandard" or "Doubtful" in accordance with
a schedule required by the supervisory authorities. The
schedule targets an aggregate reduction by 75% within 720
days of the effectiveness of the Consent Order. The Board
will monitor this effort on a monthly basis.
* The Bank will cause full implementation of its loan
underwriting, loan administration, loan documentation and
loan portfolio management policies within 90 days of the
effectiveness of the Consent Order.
* The Bank will adopt a loan review and grading system within
90 days of the Consent Order to provide for effective
periodic reviews of the Bank's loan portfolio. The system
will address, among other things, loan grading standards,
loan categorization, and credit risk analyses.
* Within 30 days of the effectiveness of the Consent Order, the
Bank will develop a plan to systematically reduce the
concentration of a significant portion of its extensions of
credit in a limited group of borrowers. Additionally, the
Bank will prepare a risk segmentation analysis with respect
to certain real estate industry concentrations of credit
identified by the supervisory authorities.
* The Bank will enhance its review of its liquidity by engaging
in monthly analyses. It will also develop and implement a
liquidity contingency and asset/liability management plan.
* Within 90 days from the effectiveness of the Consent Order,
the Bank will implement a plan and 2010 budget designed to
improve its net interest margin, increase interest income,
reduce expenditures and improve and sustain earnings.
* The Bank will implement internal routine and control policies
addressing concerns raised by its supervisory authorities and
designed to enhance its safe and sound operation.
* Within 90 days of the Consent Order, the Bank will implement
a comprehensive internal audit program and cause an effective
system of internal and external audits to be in place.
* The Bank will implement a policy for managing its "owned real
estate".
* The Bank will forebear from soliciting and accepting
"brokered deposits" unless it first receives an appropriate
waiver from the FDIC; and will comply with restrictions
issued by the FDIC on the effective yields of deposit
products offered by, among others, banks subject to consent
orders.
* A limit upon growth of 10% per year will be observed by the
Bank.
* The Bank will not pay dividends or make other forms of
payment reducing capital to the Company without the prior
approval of the supervisory authorities while the Consent
Order is in effect.
* The Bank will implement policies to enhance the Board's focus
on conflicts of interest regulations and its handling of
transactions with officers and directors.
* The Bank will correct any violations of laws and regulations
identified by the supervisory authorities.
* The Bank will make quarterly progress reports to the
supervisory authorities detailing the form and manner of
actions taken to comply with the Consent Order.
The plans, policies and procedures which the Bank is required to
prepare under the Consent Order are subject to approval by the
supervisory authorities before implementation.
Allowance for Losses
The Bank said it intends to increase the Allowance for Loan Losses
by approximately $11 million for the 4th quarter of 2009. This
increase in the ALLL is the result of an exhaustive internal and
external loan review process coupled with the implementation of
new, automated loan loss software. This software will now allow
the Bank to continuously update its allowance and provide prompt,
accurate measurement and guidance of the loan portfolio moving
forward. Said Mr. Mayer, "As we continued to analyze our loan
portfolio, we felt it important to not only update our internal
capabilities for reviewing our portfolio, but to also engage Risk
Management Group to provide an independent third party review.
Both of these reviews led us to the same decision to increase our
loan loss allowance to cushion against any potential further
deterioration in the loan portfolio." With the increase, the Bank
will now have an ALLL of over $28 million against approximately
$34 million in non-performing loans at December 31, 2009.
About 1st Financial
Formed in May 2008, 1st Financial Services Corporation --
http://www.mountain1st.com/-- is the parent company of Mountain
1st Bank & Trust Company, and is currently traded on the Over The
Counter Bulletin Board under the symbol FFIS. Established in May
of 2004, with approximately $800 million in assets, Mountain 1st
Bank and Trust's more than 173 employees serve ten counties in
western North Carolina through 15 full service branches.
MOVIE GALLERY: To Close Rochester and Cranberry Video Stores
------------------------------------------------------------
According TradingMarkets.com, Movie Gallery Inc. said it is having
a going-out-business sales at its Hollywood Video stores in East
Rochester and Cranberry Township as part of the company's Chapter
11 bankruptcy reorganization. The closing of the stores will take
place within four to six weeks.
About Movie Gallery
Based in Wilsonville, Ore., Movie Gallery, Inc. is the second
largest North American video and game rental company, operating
stores in the U.S. and Canada under the Movie Gallery, Hollywood
Video and Game Crazy brands.
Movie Gallery first filed for Chapter 11 on Oct. 16, 2007 (Bankr.
E.D. Va. Case Nos. 07-33849 to 07-33853). Kirkland & Ellis LLP
and Kutak Rock LLP represented the Debtors. The Company emerged
from bankruptcy on May 20, 2008, with private-investment firms
Sopris Capital Advisors LLC and Aspen Advisors LLC as its
principal owners. William Kaye was appointed plan administrator
and litigation trustee.
Movie Gallery returned to Chapter 11 protection on February 3,
2009 (Bankr. E.D. Va. Case No. 10-30696). Attorneys at
Sonnenschein Nath & Rosenthal LLP and Kutak Rock LLP represent the
Debtors in their second restructuring effort. Kurtzman Carson
Consultants serves as claims and notice agent.
MSCI INC: Moody's Affirms Corporate Family Rating at 'Ba2'
----------------------------------------------------------
Moody's Investors Service affirmed the Ba2 Corporate Family Rating
and debt instrument ratings of MSCI, Inc. and changed the rating
outlook to developing from positive. Moody's also affirmed the
Ba3 Corporate Family Rating and debt instrument ratings of
RiskMetrics Group Holdings LLC. RiskMetrics' rating outlook
remains positive.
These rating actions followed MSCI's announcement that it entered
into a definitive merger agreement whereby it will acquire
RiskMetrics Group, Inc.'s outstanding common equity in a cash and
stock transaction for total consideration of approximately
$1.55 billion. The existing secured debt of both MSCI and
RiskMetrics is expected to be repaid in connection with the
acquisition. The transaction is expected to be funded with
existing cash of MSCI and RiskMetrics, newly issued common stock
of MSCI and $1.275 billion of new secured debt. The transaction
is subject to customary closing conditions, including approval by
the shareholders of RiskMetrics Group, Inc., the receipt by MSCI
of the proceeds of the debt financing for the transaction,
antitrust clearance and other customary regulatory approvals. The
transaction is currently expected to close in MSCI's third fiscal
quarter of 2010.
MSCI has received a commitment letter from Morgan Stanley Senior
Funding, Inc., for senior secured credit facilities aggregating up
to $1.375 billion, which would be available, subject to customary
conditions, to fund the cash consideration in the acquisition, the
refinancing of existing senior secured credit facilities of MSCI
and RiskMetrics, and the ongoing working capital needs of MSCI and
its subsidiaries following the transaction.
The transaction is expected to materially increase MSCI's
leverage. Debt to EBITDA would increase from 2.2 times at
November 30, 2009, to approximately 4.5 times on a pro forma basis
for the acquisition (pre-synergies but after Moody's standard
adjustment for operating leases). Pro forma for management's
estimate of $50 million of cost savings, leverage would be just
under 4 times. MSCI's financial strength metrics were very strong
for the rating category prior to the acquisition and are expected
to remain adequate for the Ba2 rating category after the
acquisition. The acquisition of RiskMetrics significantly
increases MSCI's scale, product line and geographic
diversification. Moody's will evaluate the expected financial
policies, capital structure and operating strategies of MSCI upon
completion the acquisition. The developing outlook anticipates
that the Ba2 CFR of MSCI will remain unchanged upon the completion
of Moody's evaluation but that the rating outlook could be changed
to positive or stable.
If the transaction closes and all of the rated debt of RiskMetrics
is repaid, Moody's will withdraw all of the ratings of
RiskMetrics. RiskMetrics Ba3 CFR and positive outlook continue to
reflect its solid standalone credit profile characterized by
leading market, strong credit metrics, a very good liquidity
profile and a stable, subscription-based business model.
These ratings of MSCI were affirmed:
* Corporate Family Rating, Ba2
* Probability of Default Rating, Ba3
* $75 million secured revolving credit facility, Ba2 (LGD 2, 29%)
* $380 million secured term loan, Ba2 (LGD 2, 29%)
* Speculative Grade Liquidity Rating, SGL-1
These ratings of RiskMetrics were affirmed:
* Corporate Family Rating, Ba3
* Probability of Default rating, B1
* $25 million first lien revolver, Ba3 (LGD 3, 33%)
* $288 million first lien term loan, Ba3 (LGD 3, 33%)
The last rating action on MSCI was on October 13, 2009, when
Moody's affirmed the Ba2 Corporate Family Rating of MSCI and
changed the rating outlook to positive from stable. The last
rating action on RiskMetrics was on January 29, 2009, when Moody's
affirmed the Ba3 Corporate Family Rating of RiskMetrics and
changed the rating outlook to positive from stable.
MSCI is a leading provider of investment decision support tools to
investment institutions worldwide. The company's key product
lines are international equity indices marketed under the MSCI
brand and equity portfolio analytics marketed under the Barra
brand. Revenues for the fiscal year ended November 30, 2009, were
$443 million. RiskMetrics is a leading provider of risk
management and corporate governance products and services to
participants in the global financial markets. Reported revenues
for the year ended December 31, 2009, were approximately
$303 million.
MSCI INC: S&P Puts 'BB' Corp. Rating on CreditWatch Negative
------------------------------------------------------------
Standard & Poor's Ratings Services said it placed its ratings,
including the 'BB' corporate credit rating, on New York City-based
risk analytics company MSCI Inc. on CreditWatch with negative
implications. This action follows the company's announcement
earlier that it has agreed to acquire New York City-based
RiskMetrics Group Holdings LLC (BB-/Stable/--) for a combination
of debt and stock totaling about $1.6 billion.
"While S&P believes that the combination of the these two
companies will improve MSCI's scale and product mix through
increased diversity and a higher recurring revenue percentage,"
said Standard & Poor's credit analyst Joseph Spence, "the
transaction will also increase overall leverage given the
significant expected debt component." As currently proposed the
transaction will include a $1.275 billion senior secured term loan
and a $100 million revolving credit facility, anticipated to be
undrawn at close. S&P expects adjusted pro forma leverage to be
in the 4x area. Depending on MSCI's post-transaction financial
policy and growth strategy, a potential downgrade is most likely
to be limited to one notch on the corporate credit rating. In
addition, MSCI expects to use a portion of the proceeds and
combined cash balance to pay off both RiskMetrics' and its own
existing debt, after which S&P would withdraw both companies'
existing issue-level ratings, as well as RiskMetrics' corporate
credit rating.
S&P plans to meet with MSCI's management to review the company's
proposed financing for the transaction, cost synergies, financial
policy, and its strategy to merge RiskMetrics into MSCI's
operations, to resolve the CreditWatch.
MSGI SECURITY: Reports $2,921,200 Net Loss for Dec. 31 Quarter
--------------------------------------------------------------
MSGI Security Solutions, Inc., reported a net loss of $2,921,200
for the three months ended December 31, 2009, from a net loss of
$5,116,820 for the 2008 quarter. The Company posted a net loss of
$6,170,136 for the six months ended December 31, 2009, from a net
loss of $5,513,814 for the same period in 2008.
The Company has not recorded any revenue for the 2009 and 2008
quarterly periods.
At December 31, 2009, the Company had total assets of $1,686,924
against total liabilities, all current, of $18,153,452, resulting
in stockholders' deficit of $16,466,528.
During the six-month period ended December 31, 2009, the Company
received net proceeds of $586,000 from a certain corporate
officer, which has no stated interest rate or maturity date. It
is expected that the certain corporate officer will provide
further cash advances to the Company through the three month
period to end March 31, 2010, but that the advances will end upon
any successful funding event or transaction completed by the
Company.
In July 2009, the Company executed a NASA Funding Promissory Note
in the amount of $240,004 with a lender who also holds a
promissory note from December 2007. The new promissory note was
executed to enable the Company to meet its obligations under a
certain Space Act Agreement, which had been entered into with The
National Aeronautics and Space Administration. The note bears
interest at 25% and matured on August 30, 2009. In addition, the
Company was obligated to issue 500,000 shares of common stock to
the lender as additional consideration to enter into the note
agreement. The shares were issued to the lender in September
2009. The principal balance and accrued interest has not yet been
paid to the lender. Although the note is technically in default,
the lender has not made any claim of default and the Company is
currently in negotiations with the lender for an extension to the
terms of the note. There can be no assurance that the Company
will be successful in securing any extension to the note.
The Company currently has limited capital resources, has incurred
significant historical losses and negative cash flows from
operations and has no current period revenues. At December 31,
2009, the Company had $1,188 in cash and no accounts receivable.
The Company believes that funds on hand combined with funds that
will be available from its various operations will not be adequate
to finance its operations requirements and enable the Company to
meet any of its financial obligations, including its payments
under convertible notes and promissory notes for the next 12
months.
The Company has ceased its business relationship with both Hyunda1
Syscomm Corp. (Hyundai) and Apro Media Corp. (Apro or Apro Media)
and a legal action has been filed in the State of California
naming both, among others, as defendants. There are no assurances
that any further capital raising transactions will be consummated.
Although certain financing related transactions have been
successfully closed, failure of the Company's operations to
generate sufficient future cash flow and failure to consummate the
Company's strategic transactions or raise additional financing
could have a material adverse effect on the Company's ability to
continue as a going concern and to achieve its business
objectives.
The Company said these conditions raise substantial doubt about
its ability to continue as a going concern. If the Company is
unable to raise additional funds, it may be forced to further
reduce, or cease operations, liquidate assets, renegotiate terms
with lenders and others of which there can be no assurance of
success, or file for bankruptcy protection.
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?55e5
About MSGI Security
MSGI Security Solutions, Inc. (Other OTC: MSGI) --
http://www.msgisecurity.com/-- is a provider of proprietary
solutions to commercial and governmental organizations. The
Company is developing a global combination of innovative emerging
businesses that leverage information and technology. The Company
is headquartered in New York City where it serves the needs of
counter-terrorism, public safety, and law enforcement and is
developing new technologies in nanotechnology and alternative
energy as a result of its recently formed relationship with The
National Aeronautics and Space Administration (NASA).
MUSICLAND HOLDING: Profit Data Irrelevant in Best Buy Suit
----------------------------------------------------------
WestLaw reports that whether, following the sale of a corporate
debtor, its individual creditors continued to profit by doing
business with the company while it was under new ownership was
utterly irrelevant to whether the debtor's officers and directors
breached the fiduciary duties that they owed to the debtor under
Delaware law by allowing the sale to proceed. Thus, officers and
directors were not entitled to discovery regarding corporate
creditors' post-sale profits on the theory that this discovery was
relevant to the breach-of-fiduciary-duty claims against them.
Under Delaware law, while corporate directors had to consider the
interests of corporate creditors as the corporation descended into
insolvency, they still owed their fiduciary duties to the
corporation and had to maximize the value of the company for the
benefit, inter alia, of the entire creditor constituency. They
did not have a right or duty to keep the company on life support
so that specific corporate creditors would continue to have a
customer. In re Musicland Holding Corp., --- B.R. ----, 2010 WL
533119 (Bankr. S.D.N.Y.) (Bernstein, J.).
Musicland's creditors' committee (subsequently displaced by an
estate representative created under the terms of the Debtors'
Second Amended Joint Plan of Liquidation) sued (Bankr. S.D.N.Y.
Adv. Pro. No. 08-01023) Best Buy Co., Inc., the debtor's former
parent, and various officers and directors, primarily to avoid and
recover two transfers aggregating $145,385,892. In this dispute:
The Estate Representative is represented by:
Mark T. Power, Esq.
John P. Amato, Esq.
Robert J. Malatak, Esq.
Edward L. Schnitzer, Esq.
HAHN & HESSEN LLP
488 Madison Avenue
New York, NY 10022
Telephone: (212) 478-7200
and Best Buy Co., Inc., is represented by:
Michael P. Richman, Esq.
Douglas S. Heffer, Esq.
FOLEY & LARDNER LLP
90 Park Avenue
New York, NY 10016-1314
Telephone: (212) 682-7474
- and -
Elliot S. Kaplan, Esq.
Anne M. Lockner, Esq.
ROBINS, KAPLAN, MILLER & CIRESI LLP
2800 LaSalle Plaza
800 LaSalle Avenue
Minneapolis, MN 55402
Telephone: (612) 349-8500
About Musicland Holding
Based in New York, Musicland Holding Corp., is a specialty
retailer of music, movies and entertainment-related products. The
Debtor and 14 of its affiliates filed for chapter 11 protection on
Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No. 06-10064). Kirkland
& Ellis represented the Debtors in their restructuring efforts.
Hahn & Hessen LLP, represented the Official Committee of Unsecured
Creditors. At March 31, 2007, the Debtors disclosed $20,121,000
in total assets and $321,546,000 in total liabilities.
On May 12, 2006, the Debtors filed their Joint Plan of
Liquidation. On Sept. 14, 2006, they filed an amended Plan and a
Second Amended Plan on Oct. 13, 2006. The Bankruptcy Court
approved the adequacy of the Amended Disclosure Statement on
Oct. 13, 2006. The Debtor's Second Amended Joint Plan of
Liquidation was declared effective as of Jan. 30, 2008.
MERUELO MADDUX: Files Amended Joint Chapter 11 Plan
---------------------------------------------------
BankruptcyData reports that Meruelo Maddux filed its First Amended
Joint Chapter 11 Plan of Reorganization and Disclosure Statement
with the U.S. Bankruptcy Court.
According to the Disclosure Statement, "The Plan provides for the
payment in full of all Claims over time with interest. The Secured
Claims will be paid interest only over the term of the Plan and
the principal balance will be paid either through the sale of the
property securing the claim or the refinance of the secured debt.
The Plan calls for the cancellation of existing equity in MMPI.
MMPLP will be merged into MMPI and MMPLP's equity interests will
also be cancelled. Payments under the Plan will be funded from
the Debtors' operations, an infusion of capital at the Effective
Date and the sale and refinance of the certain of the Debtors'
assets."
A hearing to approve the Disclosure Statement has been scheduled
for March 19, 2010.
Meruelo Maddux and its affiliates filed for Chapter 11 protection
on March 26, 2009 (Bankr. C. D. Calif. Lead Case No. 09-13356).
Aaron De Leest, Esq., John J. Bingham, Jr., Esq., and John N.
Tedford, Esq., at Danning Gill Diamond & Kollitz, represent the
Debtors in their restructuring efforts. Asa S. Hami, Esq., Tamar
Kouyoumjian, Esq., and Victor A. Sahn, Esq., at SulmeyerKupetz, A
Prof Corp, represent the official committee of unsecured creditors
as counsel. The Debtors' financial condition as of December 31,
2008, showed estimated assets of $681,769,000 and estimated debts
of $342,022,000.
NATIONAL HOME: Has Access to Cash Collateral Until April 5
----------------------------------------------------------
The Hon. Ben T. Barry of the U.S. Bankruptcy Court for the Western
District of Arkansas approved a stipulation authorizing National
Home Centers, Inc. to access cash collateral of prepetition
secured lenders until April 5, 2010.
In the absence of a written agreement to the cash collateral, a
hearing on the Debtor's continued access to cash collateral will
be held on April 14, 2010, at 1:00 p.m. (CST) at Fayetteville
Division. Objections will also accommodated on the hearing date.
Pursuant to the stipulation, the parties agreed that:
-- the Debtor will use the prepetition secured lenders cash
collateral to fund its Chapter 11 case, pay suppliers and
other parties; and
-- adequate protection payments be made to Liberty Bank during
the term of the fifth cash collateral.
As reported in the Troubled Company Reporter on January 29, 2010,
JPMorgan Chase Bank, as lender and agent for financial institution
The CIT Group/Business Credit, Inc., provided a prepetition
credit facility to the Debtor. As of the petition date, the
principal amount owed to the secured lenders under the credit
agreement dated August 12, 2004, is approximately $11,808,000.
The value of the collateral securing the debt as of the petition
date is $32,456,706. The value of the collateral upon which the
secured lenders would lend was $15,756,135, excluding the value of
real estate.
As adequate protection for any diminution in value of the lenders'
collateral, the Debtors will grant the prepetition lenders
replacement liens, subject to carve out.
About National Home Centers
National Home Centers, Inc. -- One Source Home & Building Center
and Cleburne County Building Center -- operates storage units in
Springdale, Arizona. The Company filed for Chapter 11 bankruptcy
protection on December 8, 2009 (Bankr. W.D. Ark. Case No. 09-
76195). Charles T. Coleman, Esq.; Judy Simmons Henry, Esq.; and
Kimberly Wood Tucker, Esq., at Wright, Lindsey & Jennings assist
the Company in its restructuring effort. The Company listed
$10,000,001 to $50,000,000 in assets and $1,000,001 to $10,000,000
in liabilities.
NEENAH PAPER: Moody's Reviews 'B1' Corporate Family Rating
----------------------------------------------------------
Moody's Investors Service placed all the ratings of Neenah Paper
Inc on review for possible upgrade. This action follows Neenah's
announcement that it has signed a definitive agreement to sell its
remaining 475,000 acres of timberlands in Nova Scotia for
C$82.5 million. The transaction is expected to close before
March 31, 2010, and the company intends to use the proceeds to pay
down debt.
The review for possible upgrade will focus on Neenah's post-
redemption capital structure, liquidity profile, business
conditions, and the company's expected run rate (excluding
stumpage fees currently earned by the timberlands). The outcome
of Moody's review is likely to result in either: (i) a one notch
upgrade in the Corporate Family Rating to Ba3 from B1, or (ii) the
affirmation of the B1 CFR with a positive outlook. The rating on
the senior notes is anticipated to remain one notch below the CFR
in either scenario.
Moody's placed these ratings on review for possible upgrade:
* Corporate Family Rating, B1
* Probability of Default Rating, B1
* Speculative Grade Liquidity Rating, SGL-3
* $225 million 7.375% senior notes due November 2014, B2
The last rating action occurred on November 18, 2009, when Moody's
affirmed all of Neenah's ratings, including the B1 CFR.
Neenah Paper is a global manufacturer of premium, performance-
based papers and specialty products used in a variety of
applications including filtration, printing and writing, and as
backing and component materials for many specialized industrial
and consumer applications. Based in Alpharetta, Georgia, the
company currently has paper operations in the US and Germany and
timberlands in Nova Scotia, Canada. Revenues for the year ended
December 31, 2009, were $574 million.
NEENAH PAPER: S&P Puts 'B+' Rating on CreditWatch Positive
----------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings, including
the 'B+' corporate credit rating on Alpharetta, Ga.-based Neenah
Paper Inc. on CreditWatch with positive implications.
"The CreditWatch placement reflects S&P's view that Neenah's
financial risk profile may be more consistent with a higher rating
because of the company's plan to reduce debt with proceeds from
the sale of the timberlands," said Standard & Poor's credit
analyst Andy Sookram. Following about $45 million of debt
reduction in 2009 from generated cash flows, Neenah's total
adjusted debt should be about $340 million after the sale is
completed. As a result, S&P believes debt to 2009 EBITDA will
improve to around 4.5x from about 5.5x at Dec. 31, 2009. S&P also
expects that Neenah's operating performance will likely improve
during the next few quarters because of a recovery in market
demand due to better economic conditions and higher prices.
Specifically, S&P expects EBITDA of about $80 million in 2010,
which combined with the expected debt reduction, will lead to
improved credit measures. S&P thinks interest coverage could
strengthen to nearly 4x at Dec. 31, 2010, from 3x at Dec. 31,
2009, and debt to EBITDA decline to 4x area at year-end 2010,
which are levels that S&P consider to be appropriate for a higher
rating.
In addition, S&P expects the company will use a portion of the
sale proceeds to repay outstanding balances under the revolving
credit facility, leaving about $12 million available based on
S&P's estimation. As a result, S&P thinks Neenah's liquidity will
improve in the near term. In S&P's view, the debt paydown should
also result in increased cushion under the minimum fixed-charge
coverage covenant of 1x that is tested when availability falls
below $20 million.
Neenah produces specialty fine papers and technical products that
are used in a variety of application such as printing and writing,
filtration, tapes, and backing.
In resolving its CreditWatch listing, S&P will focus on
management's near- and intermediate business and financial
strategies, including growth objectives and financial policies.
If S&P believes an upgrade is warranted, it would likely be
limited to one notch.
NEW UNITED MOTOR: PBGC Assumes Underfunded Pension Plan
-------------------------------------------------------
The Pension Benefit Guaranty Corporation will take responsibility
for the underfunded pension plan covering more than 5,800
employees and retirees of New United Motor Manufacturing Inc.
(NUMMI), the vehicle assembler owned jointly by Toyota Motor Corp.
and Motors Liquidation Corp., the liquidating entity that remained
after General Motors emerged from bankruptcy.
The pension insurer's move comes as NUMMI prepares to end
production at its Fremont, Calif., assembly plant on March 31,
2010. The PBGC has determined the plan will be abandoned as a
result and unable to pay benefits when due.
The New United Motor Manufacturing Inc. / UAW Hourly Defined
Benefit Pension Plan is 55% funded, with assets of $161 million to
cover benefit liabilities of $292 million, according to PBGC
estimates. The agency expects to cover $126 million of the
$131 million shortfall.
Until the PBGC becomes trustee of the pension plan, the plan will
remain ongoing under company sponsorship. The agency will send
notification letters to all plan participants when it becomes
trustee.
The PBGC will take over the assets and use insurance funds to pay
guaranteed benefits earned under the plan, which ends effective
March 3, 2010. Retirees and beneficiaries will continue to
receive their monthly benefit checks without interruption, and
other participants will receive their pensions when they are
eligible to retire.
Under federal pension law, the maximum guaranteed pension at age
65 for participants in plans that terminate in 2010 is $54,000 a
year. The maximum guaranteed amount is lower for those who retire
earlier or elect survivor benefits. In addition, certain early
retirement subsidies and benefit increases made within the past
five years may not be fully guaranteed. A preliminary PBGC
analysis of the NUMMI pension plan indicates few current retirees
will see reductions to their monthly benefit.
Workers and retirees with questions may consult the PBGC Web site,
http://www.pbgc.gov/or call toll-free at 1-800-400-7242. For
TTY/TDD users, call the federal relay service toll-free at 1-800-
877-8339 and ask for 800-400-7242.
NUMMI retirees who draw a benefit from the PBGC may be eligible
for the federal Health Coverage Tax Credit. Further information
may be found on the PBGC Web site at http://www.pbgc.gov/workers-
retirees/benefits-information/content/page13692.html
Assumption of the plan's unfunded liabilities will have no
significant effect on the PBGC's financial statements because the
claim was previously included in the agency's fiscal year 2009
financial statements, in accordance with generally accepted
accounting principles.
NUMMI was formed in 1983 by Toyota and General Motors, each with a
50 percent equity interest in the enterprise. When GM emerged
from bankruptcy reorganization last year, it left its interest in
NUMMI with the old GM bankrupt estate, a liquidating corporate
shell known as Motors Liquidation Corp. Toyota is the remaining
active shareholder in NUMMI.
The PBGC is a federal corporation created under the ERISA. It
currently guarantees payment of basic pension benefits earned by
44 million American workers and retirees participating in over
29,000 private-sector defined benefit pension plans. The agency
receives no funds from general tax revenues. Operations are
financed largely by insurance premiums paid by companies that
sponsor pension plans and by investment returns.
NEXTMEDIA GROUP: Operating Unit Files Schedules of Assets & Debts
-----------------------------------------------------------------
NextMedia Operating, Inc., a debtor-affiliate of NextMedia Group,
Inc., filed with the U.S. Bankruptcy Court for the District of
Delaware its schedules of assets and liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $12,087,793
B. Personal Property $2,817,286
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $252,013,197
E. Creditors Holding
Unsecured Priority
Claims $0
F. Creditors Holding
Unsecured Non-priority
Claims $615,467
----------- -----------
TOTAL $14,275,079* $252,628,664
* corrected: $14,905,079
Greenwood Village, Colorado-based NextMedia Group, Inc., provides
out-of-home media services through radio broadcasting and outdoor
advertising. The Debtors operate an aggregate of 36 AM and FM
radio stations in a total of seven rated and unrated small, mid-
size and suburban markets, including the Greenville-New Bern-
Jacksonville, North Carolina area; the Saginaw-Bay City-Midland,
Michigan area; Canton, Ohio; Myrtle Beach, South Carolina; San
Jose, California; suburban Chicago; and suburban Dallas.
NextMedia Group filed for Chapter 11 bankruptcy protection on
December 21, 2009 (Bankr. D. Delaware Case No. 09-14463). The
Debtor's affiliates, NextMedia Investors LLC, et al., also filed
Chapter 11 bankruptcy petitions. Paul N. Heath, Esq.; Michael J.
Merchant, Esq.; and Chun I. Jang, Esq., at Richards Layton &
Finger, assist the Debtors in their restructuring efforts.
NextMedia Group listed $50,000,001 to $100,000,000 in assets and
$100,000,001 to $500,000,000 in liabilities.
NILE THERAPEUTICS: Form 10-K Has "Going Concern" Qualification
--------------------------------------------------------------
Nile Therapeutics, Inc., on March 3 announced its fourth quarter
and full year financial results for 2009. For the fourth quarter
of 2009, Nile reported a net operating loss of $1.6 million, or
$0.06 per share. For the full year, net operating loss was $7.9
million, or $0.31 per share. Weighted-average shares outstanding
for the quarter and the year ended December 31, 2008 were 27.0 and
24.5 million, respectively. Nile reported no revenue during the
quarter and the year ended December 31, 2009.
As of December 31, 2009, Nile had cash and cash equivalents of
$3.2 million compared to $5.5 million as of December 31, 2008.
Cash and cash equivalents decreased $2.3 million in the year ended
December 31, 2009; $5.8 million was used for operations, and $3.5
million was raised through a private placement of stock and the
exercise of stock options and warrants.
Nile also announced that the audit report included in its Annual
Report on Form 10-K for the year ended December 31, 2009 expresses
an unqualified audit opinion from its independent registered
public accounting firm, Crowe Horwath LLP, but contains an
explanatory paragraph relating to the company's ability to
continue as a going concern. This announcement is being made
pursuant to Nasdaq Marketplace Rule 4350(b)(1)(B), which requires
separate disclosure of the receipt of a going concern
qualification.
Update on CD-NP Program
During 2009 Nile made progress in the clinical development of CD-
NP for the treatment of patients with acute heart failure. In July
2009, the first patient was dosed in a single-blind, placebo-
controlled Phase II clinical trial designed to provide additional
information on the safety and tolerability of CD-NP when infused
for up to 72 hours in patients with acute heart failure and renal
function insufficiency. Additionally, the study contains several
exploratory efficacy endpoints to provide insight into the
potential for CD-NP to enhance renal function in acute heart
failure patients. Nile initially planned to enroll up to 40
patients in the study.
As of March 1, 2010, 30 subjects have completed dosing in study.
At the end of 2009, Nile submitted a protocol amendment to enable
the company to add up to three additional cohorts of patients,
which increases potential enrollment in the study to a total of
approximately 75 patients. Interim top-line safety data from the
on-going Phase II study suggests that CD-NP is well-tolerated at
doses of 1.25 and 2.5 ng/kg/min. Nile expect full results from
the expanded study to be available in the second half of 2010.
Following analysis of the ongoing Phase II data and subject to
such data, the company expects to initiate a Phase IIb dose-
ranging, placebo-controlled, double-blind study in acute heart
failure patients.
Conference Call
The Company will host a conference call and live webcast to
discuss these financial results and provide an update on each of
its development programs at 8:30 a.m. EST on March 5, 2010.
Interested investors may participate in the conference call by
dialing +1-877-303-6918 (USA) or +1-973-638-3210 (international).
Participants may also access both the live and archived webcast of
the conference call from the homepage and the investor relations
section of Nile's Web site at http://www.nilethera.com/
About Nile Therapeutics
Nile Therapeutics, Inc. (NASDAQ:NLTX) -- http://www.nilethera.com/
-- is a clinical-stage biopharmaceutical company that develops
innovative products for the treatment of cardiovascular disease
and other areas of unmet medical needs. Nile is initially focusing
its efforts on developing its lead compound, CD-NP, a novel
rationally designed chimeric peptide in clinical studies for the
treatment of heart failure, and CU-NP, a novel rationally designed
natriuretic peptide.
NORTEL NETWORKS: Generates US$2 Bil.+ in Completed Asset Sales
--------------------------------------------------------------
Nortel Networks Corporation issued an update on its creditor
protection proceedings in mid-February 2010.
In a company statement, Nortel noted that throughout the creditor
protection process, it has worked with its advisors and
stakeholders to conduct the sales of businesses and other
restructuring matters in a fair, efficient and responsible manner
in order to maximize value for its creditors, and in almost all
matters, resolution has been reached on a consensual basis.
These activities have been and continue to be monitored closely
by the courts, the court appointed Monitor in Canada, the U.K.
Joint Administrators, the U.S. Unsecured Creditors' Committee
(UCC), the Ad Hoc Bondholders Group and other creditor groups.
"The Board of Directors of Nortel and the management team
recognize the very difficult circumstances of the numerous and
varying stakeholders of Nortel. We have been and continue to be
focused on maximizing the value of the Company's assets and
securing the best possible outcome for our creditors, from
employee groups to bondholders," Nortel Chairman David Richardson
related in a press release. "The company continues to deal in
the most equitable way possible with its stakeholders as a whole,
while operating under creditor protection in Canada, the U.S.,
Europe and elsewhere."
Since determining in June 2009 that selling Nortel's businesses
was the best path forward, more than US$2 billion in net proceeds
have been generated through the completed sales of businesses.
Additional net proceeds of approximately US$1 billion are
expected upon the completion of the previously announced sales of
Nortel's Optical Networking and Carrier Ethernet (MEN), GSM/GSM-R
and Carrier VoIP and Application Solutions (CVAS) businesses. To
date, auctions for sale of four businesses have yielded
US$1.2 billion more in proceeds than initially set out in
'stalking horse' sale agreements. Through the sales completed or
announced to date, Nortel has preserved 13,000 jobs for Nortel
employees with the buyers of these businesses.
As recently announced, Nortel completed an agreement that will
provide for the funding by Nortel Networks Inc, a U.S.
subsidiary, of the Company's continuing work in Canada through
the remainder of the creditor protection proceedings. Nortel has
also resolved outstanding transfer pricing with Canadian and U.S.
tax authorities for the taxation years 2001 through 2005 and
settled the US$3 billion claim of the United States Internal
Revenue Service for US$37.5 million. In addition, Nortel has
restructured certain intercompany indebtedness of its Asia
Pacific affiliates to facilitate their ability to continue to
operate and participate in global asset sales.
The Company announced on February 8 that Nortel reached a
settlement agreement with former and disabled Canadian employee
representatives, on certain employment related matters regarding
former Canadian Nortel employees, including Nortel's Canadian
registered pension plans and benefits for Canadian pensioners and
Nortel employees on long term disability.
Focusing on work to be done -- Corporate
Group and Nortel Business Services (NBS)
While numerous milestones have been met, significant work remains
to be completed, Nortel related. Nortel's Corporate Group is
focused on a number of key actions including the completion of
announced sales and the sale of remaining businesses and assets,
as well as exploring strategic alternatives to maximize the value
of the Company's intellectual property. The Corporate Group is
also responsible for ongoing restructuring matters including the
creditor claims process, planning toward conclusion of the CCAA
and Chapter 11 process and distributions to creditors. The
Corporate Group also continues to provide administrative and
management support to the Nortel affiliates around the world.
The NBS Group continues to provide global transitional services
to purchasers of Nortel's businesses, in fulfillment of
contractual obligations under Transitional Service Agreements.
These services include maintenance of customer and network
service levels during the integration process, and providing the
expertise in finance, supply chain management, information
technology, R&D, human resources and real estate necessary to the
orderly and successful transition of businesses to purchasers
over a period of 12 to 24 months. NBS is also focused on
maximizing the recovery of Nortel's accounts receivables,
inventory and real estate assets.
Nortel is seeking approval of the U.S. and Canadian courts of an
employee plan that is designed to retain personnel at all levels
of Corporate Group and NBS critical to complete the remaining
work. The plan was developed in consultation with independent
expert advisors taking into account the availability of more
stable and competitive employment opportunities available to
these employees elsewhere. The plan is supported by the Monitor,
UCC and Ad Hoc Bondholders Group. Koskie Minsky LLP,
representative counsel to Canadian former employees, has been
advised of the plan.
Approximately 88 percent of the plan's costs is being funded by
the purchasers of Nortel businesses, pursuant to the terms of the
sales agreements. The purchasers have required that Nortel retain
key employees around the world to ensure that the transition to
them of the acquired businesses is as effective and efficient as
possible.
"The scope and complexity of the work to date and that remains to
be completed requires the efforts of our specialized employees
around the world," said Mr. Richardson. "In order to meet our
restructuring objectives, bring the process to conclusion and to
fulfill our obligations to provide transitional services to
purchasers of our businesses, it is essential that we retain the
personnel with the required skills, experience and institutional
knowledge. Accordingly, Nortel has developed a plan designed to
incentivize these key employees to remain with Nortel until our
work is completed."
Mr. Richardson continued, "The employees being offered
participation in the plan were instrumental in the work completed
to date and are critical to fulfilling the remaining tasks
including carrying out the Company's global fiduciary duties,
selling and transitioning businesses, unwinding partnerships,
addressing claims and analyzing thousands of contracts. The loss
of these key employees at this time would create significant
delays in our activities and place the achievement of our
objectives at risk. In short, we believe the plan is in the best
interests of our creditors and other stakeholders, and of the
process itself."
About Nortel Networks
Nortel Networks (OTCBB:NRTLQ) -- http://www.nortel.com/--
delivers communications capabilities that make the promise of
Business Made Simple a reality for the Company's customers. The
Company's next-generation technologies, for both service provider
and enterprise networks, support multimedia and business-critical
applications. Nortel's technologies are designed to help
eliminate the barriers to efficiency, speed and performance by
simplifying networks and connecting people to the information they
need, when they need it.
Nortel Networks Corp., Nortel Networks Inc., and other affiliated
corporations in Canada sought insolvency protection under the
Companies' Creditors Arrangement Act in the Ontario Superior Court
of Justice (Commercial List). Ernst & Young was appointed to
serve as monitor and foreign representative of the Canadian Nortel
Group.
The Monitor sought recognition of the CCAA Proceedings in the U.S.
by filing a bankruptcy petition under Chapter 15 of the U.S.
Bankruptcy Code (Bankr. D. Del. Case No. 09-10164). Mary Caloway,
Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney
PC, in Wilmington, Delaware, serves as the Chapter 15 petitioner's
counsel.
Nortel Networks Inc. and 14 affiliates filed separate Chapter 11
petitions on January 14, 2009 (Bankr. D. Del. Case No. 09-10138).
Judge Kevin Gross presides over the case. James L. Bromley, Esq.,
at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as
general bankruptcy counsel; Derek C. Abbott, Esq., at Morris
Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware
counsel. The Chapter 11 Debtors' other professionals are Lazard
Freres & Co. LLC as financial advisors; and Epiq Bankruptcy
Solutions LLC as claims and notice agent.
Certain of Nortel's European subsidiaries also made consequential
filings for creditor protection. The Nortel Companies related in
a press release that Nortel Networks UK Limited and certain
subsidiaries of the Nortel group incorporated in the EMEA region
have each obtained an administration order from the English High
Court of Justice under the Insolvency Act 1986. The applications
were made by the EMEA Subsidiaries under the provisions of the
European Union's Council Regulation (EC) No. 1346/2000 on
Insolvency Proceedings and on the basis that each EMEA
Subsidiary's centre of main interests is in England. Under the
terms of the orders, representatives of Ernst & Young LLP have
been appointed as administrators of each of the EMEA Companies and
will continue to manage the EMEA Companies and operate their
businesses under the jurisdiction of the English Court and in
accordance with the applicable provisions of the Insolvency Act.
Several entities, particularly, Nortel Government Solutions
Incorporated have material operations and are not part of the
bankruptcy proceedings.
As of September 30, 2008, Nortel Networks Corp. reported
consolidated assets of US$11.6 billion and consolidated
liabilities of US$11.8 billion. The Nortel Companies' U.S.
businesses are primarily conducted through Nortel Networks Inc.,
which is the parent of majority of the U.S. Nortel Companies. As
of September 30, 2008, NNI had assets of about US$9 billion and
liabilities of US$3.2 billion, which do not include NNI's
guarantee of some or all of the Nortel Companies' about
US$4.2 billion of unsecured public debt.
Bankruptcy Creditors' Service, Inc., publishes Nortel Networks
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
and ancillary foreign proceedings undertaken by Nortel Networks
Corp. and its various affiliates. (http://bankrupt.com/newsstand/
or 215/945-7000)
NORTEL NETWORKS: Courts OK CVAS Business Sale to Genband
--------------------------------------------------------
Nortel Networks Inc. and its affiliates abandoned plans to
auction off their Carrier VoIP and Application Solutions or CVAS
business and will instead sell it to Genband Inc.
GENBAND, Inc. said its agreement with Nortel to acquire
substantially all assets of Nortel's CVAS business has been
approved by bankruptcy courts in Canada and the United States.
Nortel related in a February 24 statement that it will work
towards closing a sale agreement with Genband announced December
of last year. The deal authorizes the sale of the CVAS business
for $282 million, subject to balance sheet and other adjustments
estimated at about $100 million for a net price of about
$182 million.
The CVAS business was supposed to be sold at an auction on
February 25, 2010, with Genband's $282 million serving as the
stalking horse bid or the lead bid. However, no other qualified
bidders emerged although Nortel said it had received other
expressions of interest, according to a report by The Financial
Times.
Under the deal, Genband will acquire product platforms, patents
and other intellectual property used in the CVAS business. It
also provides for the transition of most of Nortel's CVAS
customer contracts to Genband.
Most of Nortel's employees in the CVAS business will also be
offered jobs with Genband under the deal, which is expected to be
completed in the second quarter of 2010.
Charles Vogt, president and chief executive of Genband, said the
deal will put Genband in "a unique position to cost-effectively
transform today's legacy switching infrastructure for customers
around the world." He added, "This acquisition will combine
softswitch and application leadership with media, session and
security gateway leadership, creating the industry's most
comprehensive Carrier VoIP portfolio."
In an interview with Dallas Morning News, Mr. Vogt said he
expects about 400 job cuts after the deal goes through, with a
mix of layoffs at Genband and Nortel. Genband's total Dallas-
area employment, however, will increase from about 220 to between
400 and 500 after the deal is completed, according to the report.
Mr. Vogt said he is not worried about integrating the Nortel
division although its workforce is larger than Genband's staff,
pointing out that former Nortel employees already make up about
30% of Genband's staff.
The CVAS business, which employs over 2,000 people and had annual
sales of about $800 million in 2008, is one of the last major
Nortel business units to be sold, according to The Financial
Times.
About Nortel Networks
Nortel Networks (OTCBB:NRTLQ) -- http://www.nortel.com/--
delivers communications capabilities that make the promise of
Business Made Simple a reality for the Company's customers. The
Company's next-generation technologies, for both service provider
and enterprise networks, support multimedia and business-critical
applications. Nortel's technologies are designed to help
eliminate the barriers to efficiency, speed and performance by
simplifying networks and connecting people to the information they
need, when they need it.
Nortel Networks Corp., Nortel Networks Inc., and other affiliated
corporations in Canada sought insolvency protection under the
Companies' Creditors Arrangement Act in the Ontario Superior Court
of Justice (Commercial List). Ernst & Young was appointed to
serve as monitor and foreign representative of the Canadian Nortel
Group.
The Monitor sought recognition of the CCAA Proceedings in the U.S.
by filing a bankruptcy petition under Chapter 15 of the U.S.
Bankruptcy Code (Bankr. D. Del. Case No. 09-10164). Mary Caloway,
Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney
PC, in Wilmington, Delaware, serves as the Chapter 15 petitioner's
counsel.
Nortel Networks Inc. and 14 affiliates filed separate Chapter 11
petitions on January 14, 2009 (Bankr. D. Del. Case No. 09-10138).
Judge Kevin Gross presides over the case. James L. Bromley, Esq.,
at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as
general bankruptcy counsel; Derek C. Abbott, Esq., at Morris
Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware
counsel. The Chapter 11 Debtors' other professionals are Lazard
Freres & Co. LLC as financial advisors; and Epiq Bankruptcy
Solutions LLC as claims and notice agent.
Certain of Nortel's European subsidiaries also made consequential
filings for creditor protection. The Nortel Companies related in
a press release that Nortel Networks UK Limited and certain
subsidiaries of the Nortel group incorporated in the EMEA region
have each obtained an administration order from the English High
Court of Justice under the Insolvency Act 1986. The applications
were made by the EMEA Subsidiaries under the provisions of the
European Union's Council Regulation (EC) No. 1346/2000 on
Insolvency Proceedings and on the basis that each EMEA
Subsidiary's centre of main interests is in England. Under the
terms of the orders, representatives of Ernst & Young LLP have
been appointed as administrators of each of the EMEA Companies and
will continue to manage the EMEA Companies and operate their
businesses under the jurisdiction of the English Court and in
accordance with the applicable provisions of the Insolvency Act.
Several entities, particularly, Nortel Government Solutions
Incorporated have material operations and are not part of the
bankruptcy proceedings.
As of September 30, 2008, Nortel Networks Corp. reported
consolidated assets of US$11.6 billion and consolidated
liabilities of US$11.8 billion. The Nortel Companies' U.S.
businesses are primarily conducted through Nortel Networks Inc.,
which is the parent of majority of the U.S. Nortel Companies. As
of September 30, 2008, NNI had assets of about US$9 billion and
liabilities of US$3.2 billion, which do not include NNI's
guarantee of some or all of the Nortel Companies' about
US$4.2 billion of unsecured public debt.
Bankruptcy Creditors' Service, Inc., publishes Nortel Networks
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
and ancillary foreign proceedings undertaken by Nortel Networks
Corp. and its various affiliates. (http://bankrupt.com/newsstand/
or 215/945-7000)
NORTEL NETWORKS: Proposes $93 Mil. Employee Incentive Plan
----------------------------------------------------------
Nortel Networks Inc. and its affiliated debtors seek authority
from the U.S. Bankruptcy Court for the District of Delaware to
implement an incentive plan for their remaining employees and
enter into employment agreements with certain executives.
The participants under the so-called Nortel Special Incentive
Plan are employees who have been tasked to provide corporate
overhead services, according to NNI's attorney, Ann Cordo, Esq.,
at Morris Nichols Arsht & Tunnell LLP, in Wilmington, Delaware.
The contemplated corporate overhead services are required under
the transition services agreements.
The Transition Services Agreements were hammered out in
connection with the sales of the Nortel units' businesses. The
Transition Agreements require the Nortel units to continue
operating those businesses until they have been completely
transferred to the buyers.
To date, the Nortel units have more than 2,000 workers worldwide.
About 1,000 of those workers are employed in the U.S., 534 are
employed in Canada while the rest are employed in various other
countries.
The Nortel Special Incentive Plan will run from January 1, 2010
to December 31, 2011. An employee is eligible to participate in
the second year of the Incentive Plan if he or she is still
actively employed by Nortel on January 1, 2011, and prior to that
date, has not received a notice of termination of employment.
Payments under the Nortel Special Incentive Plan and the special
incentive payments under certain employment agreements for the
U.S. and Canadian Nortel Debtors as well as the Foreign Nortel
Units are estimated to total about $93 million, Ms. Cordo says.
The amounts include the individual agreements NNI has negotiated
with Christopher Ricaurte, Donald McKenna and John Veschi:
1. Under an employment agreement with Mr. Ricaurte, the
executive will be paid a base salary of $600,000, and will
be eligible to receive a special incentive payment of up to
$2.5 million. As a participant under the Nortel Networks
Limited Annual Incentive Plan, another compensation program
which gives cash awards to certain employees, Mr.
Ricaurte's annual target award will be 100% of his base
salary.
2. Mr. McKenna will receive a base salary of $475,000 and will
be entitled to a special incentive payment of up to
$1.6 million. Mr. McKenna's annual target award under the
AIP will be 100% of his base salary.
3. Mr. Veschi will receive a base salary of $340,000, and will
be entitled to a special incentive payment of up to
$400,000. His annual target award will be 75% or $255,000
of his base salary.
Payments under the Nortel Special Incentive Plan and the
Employment Agreement with respect to the U.S. Nortel Debtors only
are estimated not to exceed $56 million, according to Ms. Cordo.
In a related development, Canada-based Nortel Networks Corp. and
its four affiliates also filed a motion in the Canadian Court for
the approval of the Nortel Special Incentive Plan.
Ernst & Young Inc., the firm appointed to monitor the assets of
Nortel Networks Corporation and its four affiliates, also filed
its 37th monitor report, supporting approval of the Incentive
Plan Motion.
Payment of Awards Under Initial Plans
NNI is also seeking permission from the Bankruptcy Court to make
immediate payments under Nortel's Key Employee Retention Plan and
Key Executive Incentive Plan upon achievement of the "third
milestone," which is the confirmation by the Bankruptcy Court of
NNI's plan of reorganization or the confirmation of the Ontario
Superior Court of Justice of Nortel Networks Corp.'s plan of
restructuring or arrangement.
Pursuant to the terms of the KERP and KEIP, payment of incentive
awards will be made upon the achievement of North American
objectives of Nortel's cost reduction plan; the achievement of
certain parameters that would result in a leaner or more focused
organization; and confirmation of the reorganization plan or plan
of restructuring or arrangement.
Participants under the KERP and KEIP received their bonus awards
last year following achievement of the first two milestones.
The Bankruptcy Court will hold a hearing on March 3, 2010, to
consider approval of the Debtors' requests.
About Nortel Networks
Nortel Networks (OTCBB:NRTLQ) -- http://www.nortel.com/--
delivers communications capabilities that make the promise of
Business Made Simple a reality for the Company's customers. The
Company's next-generation technologies, for both service provider
and enterprise networks, support multimedia and business-critical
applications. Nortel's technologies are designed to help
eliminate the barriers to efficiency, speed and performance by
simplifying networks and connecting people to the information they
need, when they need it.
Nortel Networks Corp., Nortel Networks Inc., and other affiliated
corporations in Canada sought insolvency protection under the
Companies' Creditors Arrangement Act in the Ontario Superior Court
of Justice (Commercial List). Ernst & Young was appointed to
serve as monitor and foreign representative of the Canadian Nortel
Group.
The Monitor sought recognition of the CCAA Proceedings in the U.S.
by filing a bankruptcy petition under Chapter 15 of the U.S.
Bankruptcy Code (Bankr. D. Del. Case No. 09-10164). Mary Caloway,
Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney
PC, in Wilmington, Delaware, serves as the Chapter 15 petitioner's
counsel.
Nortel Networks Inc. and 14 affiliates filed separate Chapter 11
petitions on January 14, 2009 (Bankr. D. Del. Case No. 09-10138).
Judge Kevin Gross presides over the case. James L. Bromley, Esq.,
at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as
general bankruptcy counsel; Derek C. Abbott, Esq., at Morris
Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware
counsel. The Chapter 11 Debtors' other professionals are Lazard
Freres & Co. LLC as financial advisors; and Epiq Bankruptcy
Solutions LLC as claims and notice agent.
Certain of Nortel's European subsidiaries also made consequential
filings for creditor protection. The Nortel Companies related in
a press release that Nortel Networks UK Limited and certain
subsidiaries of the Nortel group incorporated in the EMEA region
have each obtained an administration order from the English High
Court of Justice under the Insolvency Act 1986. The applications
were made by the EMEA Subsidiaries under the provisions of the
European Union's Council Regulation (EC) No. 1346/2000 on
Insolvency Proceedings and on the basis that each EMEA
Subsidiary's centre of main interests is in England. Under the
terms of the orders, representatives of Ernst & Young LLP have
been appointed as administrators of each of the EMEA Companies and
will continue to manage the EMEA Companies and operate their
businesses under the jurisdiction of the English Court and in
accordance with the applicable provisions of the Insolvency Act.
Several entities, particularly, Nortel Government Solutions
Incorporated have material operations and are not part of the
bankruptcy proceedings.
As of September 30, 2008, Nortel Networks Corp. reported
consolidated assets of US$11.6 billion and consolidated
liabilities of US$11.8 billion. The Nortel Companies' U.S.
businesses are primarily conducted through Nortel Networks Inc.,
which is the parent of majority of the U.S. Nortel Companies. As
of September 30, 2008, NNI had assets of about US$9 billion and
liabilities of US$3.2 billion, which do not include NNI's
guarantee of some or all of the Nortel Companies' about
US$4.2 billion of unsecured public debt.
Bankruptcy Creditors' Service, Inc., publishes Nortel Networks
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
and ancillary foreign proceedings undertaken by Nortel Networks
Corp. and its various affiliates. (http://bankrupt.com/newsstand/
or 215/945-7000)
NORTEL NETWORKS: Wants to Enforce Stay on UK Pension Authorities
----------------------------------------------------------------
Nortel Networks Inc. and its affiliated debtors sought and
obtained a ruling from the U.S. Bankruptcy Court for the District
of Delaware that would block two U.K. pension authorities from
participating in an administrative case pursued by the U.K.
pensions regulator to recover as much as GBP2.1 billion from the
Debtors.
In a February 26, 2010 ruling, Bankruptcy Judge Kevin
Gross ordered the enforcement of the automatic stay against
Nortel Networks UK Pension Trust Limited and The Board of
the Pension Protection Fund. The Bankruptcy Court held that
(i) participation of the UK Pension Authorities in the U.K.
administrative proceeding will be a violation of the automatic
stay and that (ii) sanctions will be meted out on the U.K.
Pension Authorities should they participate.
The Bankruptcy Court also held that the U.K. administrative
proceeding initiated by the U.K. Pensions Regulator is "deemed
void and of no force or effect" on NNI and its U.S. debtor
affiliates.
The Nortel Networks UK Pension Trust Limited is the trustee of
Nortel Networks UK Limited's pension plan program. The PPF is a
U.K. statutory body established under the U.K. Pensions Act of
2004. The commencement of NNUK's administration proceedings in
the U.K. led to an "assessment period" where the PPF worked with
the NNUK Pension Trustee to determine the funding position of the
NNUK Pension Plan.
The NNUK Pension Trustee and the PPF jointly filed proofs of
claim in the U.S. Nortel Debtors ' Chapter 11 cases in connection
with the NNUK Pension Plan that was allegedly left underfunded
after NNUK filed for bankruptcy. The U.K. Pension Claim alleges
that the NNUK Pension Plan is underfunded by as much as
GBP2.1 billion or approximately US$3.1 billion.
The alleged shortfall in the funding of the NNUK Pension Plan
prompted the U.K. Pensions Regulator to issue a warning notice on
the Debtors in January 2010, initiating an administrative
proceeding whose purpose was to determine whether a financial
support direction should be issued on Nortel entities that are
connected with NNUK.
A Financial Support Direction or FSD is a direction issued to an
employer or an entity connected with that employer to secure
financial support for a pension plan. Securing a FSD would allow
the U.K. Pensions Regulator to make a claim on the far-flung
assets of Nortel Entities, The Financial Times points out.
Without the FSD, the U.K. Regulator could only assert a claim on
NNUK's assets.
Counsel to the Debtors, Delaware-based Morris Nichols Arsht &
Tunnell LLP, and the Official Committee of Unsecured Creditors
asserted that the U.K. Pension Claim should be appropriately
determined by the Bankruptcy Court only, emphasizing that the
NNUK Pension Trustee and the PPF submitted to the Bankruptcy
Court's jurisdiction when they filed their proofs of claim
against the Debtors under Chapter 11.
The PPF and the NNUK Pension Trustee defended their action by
saying that the U.K. administrative proceeding would only
determine any claim against the Debtors and thus, would not
violate the automatic stay. The U.K. Pension Authorities also
argued that NNUK Pension Trustee ought to participate in the U.K.
administrative proceeding because any money recovered would be
payable to it, among other reasons.
The U.K. Pension Authorities also asserted that the Debtors did
not make any contribution to the NNUK Pension Plan between 1991
and 2002, preferring to put aside money for other purposes "at
the expense of the pension plan and its members." They further
noted that U.K.-based Nortel employees had contributed more than
$150 million during the same period, according to a
February 28, 2010 report by The Ottawa Citizen.
In a related development, Canada-based Nortel Networks Corp. and
Ernst & Young Inc., the firm appointed to monitor the assets of
NNC and four of its Canadian affiliates, asked the Ontario
Superior Court of Justice to direct them to refrain from
participating in the U.K. administrative proceeding.
Under its 38th Monitor Report, Ernst & Young contended that the
U.K. administrative proceeding violates the stay granted by the
Canadian Court through its initial order as well as circumvents
the Canadian Court-approved claims process.
The Canadian Court, which was suppose to hear the Debtors'
Enforcement Motion on February 26, has not yet issued a ruling as
of press time. The Bankruptcy Court and the Canadian Court are
working in tandem on Nortel's Chapter 11 and insolvency cases.
According to a report by The Financial Times, the matter on the
Nortel Pension Claim is seen to have important implications on
the ability of the U.K. Pensions Regulator to recover amounts for
scheme members or for the PPF, which covers a portion of
underfunded benefits, from related companies outside the U.K.
"This case hinges on whether the U.K. regulator's powers are
recognized by the Canadian courts," The Financial Times quoted
John Ralfe, an independent pensions adviser, as saying.
The U.K. Regulator won a similar case three years ago in the U.S.
in respect of the U.K. scheme of Sea Containers, but the law in
Canada has not yet been tested, the report notes.
About Nortel Networks
Nortel Networks (OTCBB:NRTLQ) -- http://www.nortel.com/--
delivers communications capabilities that make the promise of
Business Made Simple a reality for the Company's customers. The
Company's next-generation technologies, for both service provider
and enterprise networks, support multimedia and business-critical
applications. Nortel's technologies are designed to help
eliminate the barriers to efficiency, speed and performance by
simplifying networks and connecting people to the information they
need, when they need it.
Nortel Networks Corp., Nortel Networks Inc., and other affiliated
corporations in Canada sought insolvency protection under the
Companies' Creditors Arrangement Act in the Ontario Superior Court
of Justice (Commercial List). Ernst & Young was appointed to
serve as monitor and foreign representative of the Canadian Nortel
Group.
The Monitor sought recognition of the CCAA Proceedings in the U.S.
by filing a bankruptcy petition under Chapter 15 of the U.S.
Bankruptcy Code (Bankr. D. Del. Case No. 09-10164). Mary Caloway,
Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney
PC, in Wilmington, Delaware, serves as the Chapter 15 petitioner's
counsel.
Nortel Networks Inc. and 14 affiliates filed separate Chapter 11
petitions on January 14, 2009 (Bankr. D. Del. Case No. 09-10138).
Judge Kevin Gross presides over the case. James L. Bromley, Esq.,
at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as
general bankruptcy counsel; Derek C. Abbott, Esq., at Morris
Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware
counsel. The Chapter 11 Debtors' other professionals are Lazard
Freres & Co. LLC as financial advisors; and Epiq Bankruptcy
Solutions LLC as claims and notice agent.
Certain of Nortel's European subsidiaries also made consequential
filings for creditor protection. The Nortel Companies related in
a press release that Nortel Networks UK Limited and certain
subsidiaries of the Nortel group incorporated in the EMEA region
have each obtained an administration order from the English High
Court of Justice under the Insolvency Act 1986. The applications
were made by the EMEA Subsidiaries under the provisions of the
European Union's Council Regulation (EC) No. 1346/2000 on
Insolvency Proceedings and on the basis that each EMEA
Subsidiary's centre of main interests is in England. Under the
terms of the orders, representatives of Ernst & Young LLP have
been appointed as administrators of each of the EMEA Companies and
will continue to manage the EMEA Companies and operate their
businesses under the jurisdiction of the English Court and in
accordance with the applicable provisions of the Insolvency Act.
Several entities, particularly, Nortel Government Solutions
Incorporated have material operations and are not part of the
bankruptcy proceedings.
As of September 30, 2008, Nortel Networks Corp. reported
consolidated assets of US$11.6 billion and consolidated
liabilities of US$11.8 billion. The Nortel Companies' U.S.
businesses are primarily conducted through Nortel Networks Inc.,
which is the parent of majority of the U.S. Nortel Companies. As
of September 30, 2008, NNI had assets of about US$9 billion and
liabilities of US$3.2 billion, which do not include NNI's
guarantee of some or all of the Nortel Companies' about
US$4.2 billion of unsecured public debt.
Bankruptcy Creditors' Service, Inc., publishes Nortel Networks
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
and ancillary foreign proceedings undertaken by Nortel Networks
Corp. and its various affiliates. (http://bankrupt.com/newsstand/
or 215/945-7000)
NOVA HOLDING: Has Access to West LB Cash Collateral Until March 12
------------------------------------------------------------------
Nova Holding Clinton County LLC and its debtor-affiliates obtained
approval from the U.S. Bankruptcy Court for the District of
Delaware of a 13th stipulation entered with WestLB AG (New York
Branch), extending the maturity date of the DIP Facility to
March 12, 2010.
As reported in the Troubled Company Reporter on July 8, 2009, the
Court granted the Debtors, authorization, on a final basis, to
obtain $2,030,000 senior secured postpetition financing from
WestLB AG (New York Branch).
In the 13th stipulation, the parties agreed that, among other
things:
1. The sale, lease, license or other disposition of the Seneca
Plant and the other DIP Collateral to the winning bidder or
winning bidders and the assignment of the designated
licenses and executory contracts to the appropriate parties
will close no later March 12, 2010. If the sale, lease,
license or other disposition of the Seneca Plant and the
other DIP Collateral is to the Court approved back-up
bidder, the closing on the sale, lease, license or other
disposition will occur no later than March 12, 2010.
2. The Debtors' authority to use the proceeds of the DIP
Facility will terminate automatically on the earliest of
March 12, 2010, or on the occurrence of a termination event.
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.
NOWAUTO GROUP: Posts $522,668 Net Loss for Dec. 31 Quarter
----------------------------------------------------------
NowAuto Group Inc. reported a net loss of $522,668 for the fiscal
second quarter ended December 31, 2009, from a net loss of
$547,214 for the fiscal 2008 second quarter. The Company reported
a net loss of $965,370 for the six months ended December 31, 2009,
from a net loss of $1,138,039.
The Company said total revenue was $1,481,541 for the three months
ended December 31, 2009, from $1,361,650 for the same period in
2008. Total revenue was $2,908,168 for the six months ended
December 31, 2009, from $2,467,876 for the same period in 2008.
At December 31, 2009, the Company had total assets of $4,528,029
against total liabilities of $12,011,983, resulting in
stockholders' deficit of $7,483,954.
"The present condition of the sub-prime and below sub-prime auto
market has continued to impact our industry and our company" said
CEO Scott Miller. "While we have managed to increase year-over-
year sales revenue our challenge has been, and will continue to be
on, collections. Our challenge in the current environment is to
aggressively work with our customers to maintain active contracts.
Tighter underwriting criteria yielded positive results in the
September 2010 quarter. Nevertheless, we expect a difficult
environment for the foreseeable future. Our commitment to
customers and shareholders alike remains; NowAuto will do whatever
it can to maintain productive contracts without placing imprudent
demands on our customers" Miller said.
"We continue to seek new ways to improve ourselves and have seen
some success," said Chief Financial Officer Faith Forbis. "The
current economy has created many challenges that will continue in
the near future. Never-the-less, we have been slowly building
momentum," said Forbis.
"Programs initiated in fiscal 2009 have resulted in solid year-
over-year volume and lease revenue" said Chief Operating Officer
Tino Valenzuela. "We successfully consolidated our Corporate and
Reconditioning operations during the September 2010 quarter,
resulting in a significantly faster and more efficient turn over
of inventory" said Valenzuela.
In its Form 10-Q report for the period ended December 31, 2009,
the Company said, "We sustained a material loss in the year ended
June 30, 2005. This loss continued through June 30, 2009. This
raises substantial doubt about our ability to continue as a going
concern. The financial statements do not include any adjustments
that might result from this uncertainty."
According to the Company, "since that initial loss, great efforts
have been made to improve our profitability. Margins on cars sold
have increased. Costs, especially overhead, have been reduced.
Head count is kept to a minimum. Accountability has been greatly
enhanced by development of qualified Accounting staff and the
implementation of an enterprise-wide and fully integrated software
system. The Company has been and continues to develop the
financing function whose focus includes, but is not limited to
improved stability scoring and credit approval process,
improvement of the total portfolio aging, and reduction of account
losses. [T]he corporate office and Service Department relocated
to the same facility. This new facility greatly enhances the
Service Department's efficiency and capacity and gives upper
management closer oversight of operations."
At December 31, 2009, the Company had a $11.5 million line of
credit balance under a $12 million line of credit agreement with
a privately held, independent finance company. Interest rate on
the line of credit agreement is at prime plus 6% (9.25% at
December 31, 2009). The line of credit agreement has two
covenants, neither of which the Company is in compliance with as
of December 31, 2009. However, management believes they have a
positive relationship with the independent finance company and
does not expect any collection activity as a result of these
defaults. The original line of credit with the lender at its
inception in 2006 was $3,000,000 and the lender has periodically
and consistently increased the limit as the need arose.
Considering the Company's current working capital position
management estimates that the current cash position will not be
adequate to meet cash requirements for the next 12 months and that
additional draws will need to be made against the line of credit
to fund operations. Subsequent to December 31, 2009, the Company
has been allowed to take additional draws under the revolving
credit agreement. "We anticipate that we will be able to continue
to draw on this credit facility as the need arises until such time
as we are able to generate sufficient cash flow from operations to
be self sufficient and commence repaying the debt," the Company
said.
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?55b2
A full-text copy of the Company's earnings release is available at
no charge at http://ResearchArchives.com/t/s?55f8
NowAuto Group, Inc., operates three buy-here-pay-here used vehicle
dealerships in Arizona. The Company manages all of its
installment finance contracts and purchases installment finance
contracts from a select number of other independent used vehicle
dealerships.
NUTRACEA INC: Infant-Cereal Business Sold to Kerry Inc.
-------------------------------------------------------
Bill Rochelle at Bloomberg News reports that the Bankruptcy Court
approved the sale of NutraCea's infant-cereal business to Kerry
Inc. for $3.9 million. Under the sale process sanctioned by the
Court, Kerry's $3.9 million would start the auction where other
parties may submit competing bids. However, no competing bids
were submitted prior to the deadline.
Kerry, Inc., a global food ingredients company, has agreed to pay
$3.9 million plus the actual cost of NutraCea's inventory related
to its cereal ingredients business. The assets to be sold include
certain equipment located in NutraCea's Phoenix plant as well as
related customer and supplier lists and purchase orders related to
the cereal ingredients business. Neither the Phoenix plant nor
any of the manufacturing assets located in the Company's Dillon,
Montana facility are included in the transaction.
At Closing, Kerry and NutraCea will enter into a Toll Processing
agreement whereby until the earlier of (1) the date Kerry begins
production of cereal products using the assets purchased under the
Purchase Agreement and (2) October, 31, 2010, NutraCea will
produce for Kerry cereal products at NutraCea's Dillon, Montana
plant.
About NutraCea
NutraCea is a world leader in production and utilization of
stabilized rice bran. NutraCea holds many patents for stabilized
rice bran (SRB) production technology and proprietary products
derived from SRB. NutraCea's proprietary technology enables the
creation of food and nutrition products to be unlocked from rice
bran, normally a waste by-product of standard rice processing.
Phoenix, Arizona-based Nutracea, a California corporation, filed
for Chapter 11 bankruptcy protection on November 10, 2009 (Bankr.
D. Ariz. Case No. 09-28817). S. Cary Forrester, Esq., at
Forrester & Worth, PLLC, assists the Company in its restructuring
effort. The Company listed $50,000,001 to $100,000,000 in assets
and $10,000,001 to $50,000,000 in liabilities.
NUTRACEA INC: Promotes Leo G. Gingras to President
--------------------------------------------------
NutraCea Inc. disclosed that the Company's Board of Directors
promoted Leo G. Gingras to President on February 25, 2010.
Gingras will retain his title of Chief Operating Officer.
Mr. Gingras joined NutraCea in 2007 as Chief Operating Officer
following 18 years at Riceland Foods, Inc., the largest rice
miller and rice oil manufacturer in the U.S. where he managed
business units with sales of over $320 million and a workforce of
several hundred. In addition to his existing COO
responsibilities, Gingras will take on a more active role in
partnering with W. John Short, Chairman and CEO of NutraCea to
lead the tactical and strategic repositioning of the business.
Short, commented, "Leo is a key member of our management team and
one of the few true industry specialists in development of value
added rice based products. His promotion is a confirmation of the
significant contributions Leo has made to NutraCea since joining
our organization and his importance to the future of our business.
I deeply appreciate his continuing leadership and dedication to
our company and look forward to collaborating with him and other
members of management as we continue to reposition NutraCea."
The Board also appointed William J. Cadigan as Chief Financial
Officer of NutraCea on February 25, 2010. Bill has served as Vice
President Finance of NutraCea since July 2009. Bill has been a
partner with Tatum, LLC since 2004. Tatum is a nationwide
executive services firm providing CFOs and CIOs on an as needed
basis. At Tatum, Mr. Cadigan served in numerous business and
financial executive positions and interim chief financial officer
roles. Bill earned his Masters of Management from the Kellogg
School at Northwestern University in 1994, his MBA in Public
Accounting from Baruch College in 1973 and his BA in Business
Administration from Rutgers University in 1971. In addition, Mr.
Cadigan is a Certified Turnaround Professional and a Certified
Insolvency and Restructuring Advisor.
"We are most pleased to have Bill assume the role of CFO. His
diversified business experience and financial expertise uniquely
qualify him for this key position. NutraCea will continue to
benefit from his sound guidance and financial acumen going
forward," said, Short.
Additionally, the Board of Directors announced that Kody Newland,
Senior Vice President of Sales has signed a new contract for two
years through March 2012. Newland joined NutraCea in 2006 and is
a veteran sales and marketing professional with nearly three
decades of expertise in this arena.
Short stated, "I am thrilled that Kody will continue to lead our
sales efforts. His in-depth knowledge of applications for SRB and
DRB, coupled with his demonstrated ability in building
relationships and developing new business opportunities is
invaluable to NutraCea and provide a solid base from which to grow
profitable sales in the future."
On November 10, 2009 NutraCea filed for court supervised
protection to restructure its operation under Chapter 11 of the US
Bankruptcy Code.
About NutraCea
NutraCea is a world leader in production and utilization of
stabilized rice bran. NutraCea holds many patents for stabilized
rice bran (SRB) production technology and proprietary products
derived from SRB. NutraCea's proprietary technology enables the
creation of food and nutrition products to be unlocked from rice
bran, normally a waste by-product of standard rice processing.
Phoenix, Arizona-based Nutracea, a California corporation, filed
for Chapter 11 bankruptcy protection on November 10, 2009 (Bankr.
D. Ariz. Case No. 09-28817). S. Cary Forrester, Esq., at
Forrester & Worth, PLLC, assists the Company in its restructuring
effort. The Company listed $50,000,001 to $100,000,000 in assets
and $10,000,001 to $50,000,000 in liabilities.
OHIO HOUSING: Moody's Downgrades Ratings on Revenue Bonds to 'Ba1'
------------------------------------------------------------------
Moody's has downgraded to Ba1 from Aaa the Ohio Housing Finance
Agency, Multifamily Housing Revenue Bonds (Sharon Green Townhomes)
2005G and removed it from Watchlist, following a review of cash
flow and parity sufficiency for the life of the bonds, assuming a
0% reinvestment rate. This action affects $5.9 million in debt.
The bonds are secured by a mortgage that is guaranteed by a Fannie
Mae Stand-by Credit Enhancement Instrument and were structured
without a Guaranteed Investment Contract that assures a fixed rate
of return on invested cash, subjecting the transaction to interest
rate risk on retained revenues. As a result, revenue from the
monthly mortgage receipts, interest earned on those receipts from
money market funds or other short-term investments and monthly
mortgage payments need to be sufficient to support debt service on
the bonds. Additionally, at all times the ratio of the value of
the assets held by the trustee, consisting of the amortized value
of the credit-enhanced mortgage and funds pledged to bondholders,
to the bonds outstanding and accrued interest to any redemption
date should exceed 100%.
Assuming no reinvestment earnings on the monthly mortgage
receipts, the projected ratio of assets to liabilities is under
100%, with the result that in a special redemption bondholders
would receive less than the full principal and accrued interest on
the bonds. This scenario, therefore, would not be consistent with
a Aaa rating. Based on information Moody's have received, Moody's
believe that the declines in the parity ratio are primarily due to
the failure to redeem bonds as directed under the indenture. Also
contributing to the shortfall are the very low investments
earnings over the past few years.
The last rating action with respect to the Series 2001 bonds was
on January 26, 2010, when the bonds were placed on Watchlist for
Possible Downgrade.
ONEIDA LTD: $6M Chapter 11 Claim Spat Heads to 2nd Circ.
--------------------------------------------------------
Law360 reports that Peter J. Solomon Co. LP is challenging in a
federal appeals court a ruling expunging its claim for more than
$6 million it says it was owed because Oneida Ltd. didn't send
written notice before retaining another financial adviser ahead of
its March 2006 Chapter 11 filing.
Headquartered in Oneida, New York, Oneida Ltd. (OTC: ONEI) --
http://www.oneida.com/-- manufactures stainless steel and
silverplated flatware for both the Consumer and Foodservice
industries, and supplies dinnerware to the foodservice industry.
Oneida also supplies a variety of crystal, glassware and metal
serveware for the tabletop industries. The Company has
operations in the United States, Canada, Mexico, the U.K., and
Australia.
The Company and its eight affiliates filed for Chapter 11
protection on March 19, 2006 (Bankr. S.D. N.Y. Case No.
06-10489). On May 12, 2006, Judge Gropper approved the Debtors'
disclosure statement. Their pre-negotiated plan of
reorganization was confirmed on Aug. 31, 2006. The company
emerged from Chapter 11 on Sept. 15, 2006, as a privately held
company.
OWENS CORNING: Moody's Affirms 'Ba1' Corporate Family Rating
------------------------------------------------------------
Moody's Investors Service affirmed Owens Corning's ratings --
Corporate Family Rating and Probability of Default at Ba1 and the
senior unsecured bank credit facility and senior unsecured notes
at Ba1. Owens Corning's speculative grade liquidity score remains
SGL-2. The outlook has been changed to stable.
The change in outlook to stable from negative results from the
modest expansion in the North American economy, resulting in
improved earnings prospects for Owens Corning's businesses.
Expected improvement in credit metrics resulting from improved
operating performance and debt reduction supports the stable
outlook as well.
The Ba1 Corporate Family Rating considers Owens Corning's business
mix, scale, expectations for operating improvement and good
liquidity profile. Owens Corning will likely remain reliant on
its roofing business to offset weakness in other business segments
over the intermediate term, despite efforts to diversify into
composite materials, and modestly improved outlooks for other
lines. Longer term, its diverse product portfolio should position
the company to reap benefits when the economy rebounds more
robustly.
Owens Corning's corporate family rating is currently constrained
by the company's weak credit metrics. Debt-to-EBITDA of 4.9 times
at FYE09 and EBITA-to-interest expense for 2009 of 1.5 times (all
ratios adjusted per Moody's methodology) are weak for the current
rating. Although operating margins are expected to improve, Owens
Corning may be unable to immediately pass higher raw material
costs for commodities such as chemicals, resins and asphalt to its
customers, creating volatility in its operating margins.
Additionally, the company's insulation business could suffer if
the U.S. Government prematurely removes its support for the
domestic housing market, a driver of the company's insulation
business. At the same time, Moody's believes that a combination
of operating efficiencies and the use of free cash flow to reduce
balance sheet debt would result in the company's debt leverage and
interest coverage becoming more supportive of the Ba1 Corporate
Family Rating over time.
These ratings/assessments were affected by this action:
-- Corporate Family Rating affirmed at Ba1;
-- Probability of Default Rating affirmed at Ba1;
-- $1.6 billion senior unsecured bank credit facility due 2011
affirmed at Ba1, but its loss given default assessment is
changed to (LGD4, 58%) from (LGD4, 54%);
-- $650 million senior unsecured notes due 2016 affirmed at Ba1,
but its loss given default assessment is changed to (LGD4,
58%) from (LGD4, 54%);
-- $350 million senior unsecured notes due 2019 affirmed at Ba1,
but its loss given default assessment is changed to (LGD4,
58%) from (LGD4, 54%);
-- $550 million senior unsecured notes due 2036 affirmed at Ba1,
but its loss given default assessment is changed to (LGD4,
58%) from (LGD4, 54%); and,
-- Senior unsecured shelf affirmed at (P)Ba1.
The company's speculative grade liquidity rating remains at SGL-2.
The last rating action was on June 3, 2009, at which time Moody's
affirmed Owens Corning's Corporate Family Rating at Ba1.
Owens Corning, headquartered in Toledo, OH, is a global producer
of composite and building materials systems. Products range from
glass fiber used to reinforce composite materials used in
transportation, electronics, marine, wind energy and other high-
performance markets to insulation, roofing and manufactured stone
veneer used in residential, commercial and industrial
applications.
Revenues for FY09 totaled approximately $4.8 billion.
PACIFIC EXPRESS: Case Summary & 6 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Pacific Express Investment Corporation
21415 Branding Bay
San Antonio, TX 78259
Bankruptcy Case No.: 10-50800
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Western District of Texas (San Antonio)
Debtor's Counsel: William R. Davis, Jr., Esq.
Langley & Banack, Inc
745 E Mulberry Ave, Suite 900
San Antonio, TX 78212
Tel: (210) 736-6600
Fax: (210) 735-6889
Email: wrdavis@langleybanack.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including a list of its
6 largest unsecured creditors, is available for free at:
http://bankrupt.com/misc/txwb10-50800.pdf
The petition was signed by David Sumner, president of the Company.
PANELIZED BUILDING: Voluntary Chapter 11 Case Summary
-----------------------------------------------------
Debtor: Panelized Building Systems, Inc.
P.O. Box 92758
Southlake, TX 76092
Bankruptcy Case No.: 10-41487
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Northern District of Texas (Ft. Worth)
Judge: Russell F. Nelms
Debtor's Counsel: Wade Travis Kricken, Esq.
Wade Kricken Law Firm
3637 Forest Lane, Ste. 124
PO Box 1263
Dallas, TX 75244
Tel: (214) 418-1187
Fax: (972) 788-1419
Email: wade@krickenlawfirm.com
Estimated Assets: Not Stated
Estimated Debts: Not Stated
The Debtor did not file a list of its 20 largest unsecured
creditors when it filed its petition.
The petition was signed by John Culbertson, president of the
Company.
PARK SUITES HOTEL: Involuntary Chapter 11 Case Summary
------------------------------------------------------
Alleged Debtor: Park Suites Hotel, Inc.
dba Best Western Park Suites Hotel
640 Park Blvd., E
Plano, TX 75074
Case Number: 10-40688
Involuntary Chapter 11 Petition Date: March 1, 2010
Court: Eastern District of Texas (Sherman)
Petitioner's Counsel: Martin K. Thomas, Esq.
Thomas & Sobol
P.O. Box 36528
Dallas, TX 75235
Tel: (214) 951-9466
Fax: (214) 951-9007
Email: thomas12@swbell.net
Debtors' Counsel: Martin K. Thomas, Esq.
Thomas & Sobol
P.O. Box 36528
Dallas, TX 75235
Tel: (214) 951-9466
Fax: (214) 951-9007
Email: thomas12@swbell.net
Park Suites Hotel, Inc. and debtor-affiliates' petitioners:
Petitioners Nature of Claim Claim Amount
----------- --------------- ------------
BNP Industries supplies $11,300
dba Savannah Soaps
3504 Edwin St
Savannah, GA 31405
Chase Oaks Consulting, Inc. Computer Repair/ $2,350
733 Forest Bend Dr., Maintenance Services
Plano, TX 75025
Nathson Const Services repairs/maintenance $8,400
8018 E. Santa Ana
Canyon Road, Suite 100
Anaheim, CA 92808
---------
Total Amount of Petitioner's Claims: $22,050
PARMALAT SPA: Hermes Seeks Final Settlement Approval
----------------------------------------------------
Lead Plaintiffs Hermes Focus Asset Management Europe Limited,
Cattolica Partecipazioni, S.p.A., Capital & Finance Asset
Management, Societe Moderne des Terrassements Parisiens and
Solotrat notify the Court and parties-in-interest that they will
ask the U.S. District Court for the Southern District of New York
on March 8, 2010, for final approval of their proposed settlements
with Defendants Deloitte Touche Tohmatsu, Deloitte & Touche LLP,
James Copeland, Grant Thornton International, Grant Thornton
International Limited, Grant Thornton LLP, Grant Thornton S.p.A.
The Lead Plaintiffs also file an accompanying memorandum of law, a
declaration by Aaron Waugh, and a joint declaration of Lisa M.
Mezzetti, James J. Sabella and Robert M. Roseman in support of
their request.
James J. Sabella, Esq., at Grant & Eisenhofer P.A., in New York,
asserts that the Settlements, which the Court addressed in its
order dated November 24, 2009, are fair and in the best interests
of investors, who were damaged by the fraudulent conduct that led
to the collapse of Parmalat Finanziaria S.p.A. and its affiliates.
The Settlements provide for payment of a total of $15 million.
Specifically, the Deloitte Settlement provides for a settlement
amount of $8.5 million, and the Grant Thornton Settlement provides
for a settlement amount of $6.5 million. The Settlement
Stipulations provides for the release of claims against, inter
alia, the Deloitte and Grant Thornton Defendants and their member
firms.
Consistent with the Court's decision on the motion for class
certification, the settlement funds will be paid, pursuant to the
Plan of Allocation, to domestic purchasers, who purchased or
otherwise acquired Parmalat equity securities between January 5,
1999, and December 18, 2003, inclusive.
As the Court is aware, Mr. Sabella notes, there were several prior
settlements in the multidistrict litigation. Previously, Banca
Nazionale del Lavoro S.p.A. paid $25 million to settle claims
against it, Credit Suisse Group and related defendants paid
$25 million to settle claims against them, and Parmalat S.p.A.
paid 10.5 million shares of Parmalat S.p.A. to settle claims
against it, which shares sold in the market for approximately
$26 million. He asserts that those settlements were all granted
final approval by the Court. Thus, he says, combined with the
prior settlements, the Settlements with the Auditor Defendants
brings the total recovery in the case to just over $90 million.
In connection with Lead Plaintiffs' motion for a preliminary
order, the Court approved a notice plan, including publishing the
notice in The Wall Street Journal, on the PR Newswire and the
Businesswire, and mailing the notice to Class members, who could
be reasonably identified. The Court's Preliminary Order directed
the Lead Plaintiffs to commence the notice plan by December 10,
2009.
Mr. Sabella informs the Court that the Lead Plaintiffs have
complied with the notice requirements. The Notices described the
terms of the Settlements and provided Class Members an opportunity
to request exclusion from the Settlement Class by February 1,
2010, or to object to the Settlements by February 15. As of
February 26, he discloses, no objections have been received. He
adds that the Class' reaction to the Settlements also supports
approval.
In connection with the Settlements, Class Counsel Grant &
Eisenhofer P.A.; Cohen, Milstein, Sellers & Toll, PLLC; and
Spector Roseman Kodroff & Willis, P.C., also ask the Court,
pursuant to Rule 23(h) of the Federal Rules of Civil Procedure, to
award them (i) attorneys' fees in the amount of 18.5% of the Gross
Settlement Fund, and (ii) reimbursement of expenses amounting to
$161,857.
Parties Seal Briefs
In a letter addressed to Judge Lewis A. Kaplan of the U.S.
District Court for the Southern District of New York, Linda T.
Coberly, Esq., at Winston & Strawn LLP, in Chicago, Illinois, says
that she writes on behalf of the parties in the cases involving
Grant Thornton International and Grant Thornton LLP in the
multidistrict litigation concerning the record underlying the
Court's opinion and judgment in the cases. She reminds the Court
that the summary judgment briefing in the cases began with the
compilation of extensive draft joint statements of disputed and
undisputed facts under Rule 56.1 of the Local Civil Rules of the
District Court for the Southern District of New York, prepared at
the Court's direction over the course of several months.
Summary judgment briefing, then, followed in stages, concluding
with the issue of in pari delicto, which the Court found
dispositive. Although the Court received both hard copies and
electronic versions of the Rule 56.1 statements concerning in pari
delicto, the evidence underlying those statements was submitted to
the Court only in electronic "ibrief" format, prepared for the
Court's convenience. The ibrief was submitted to the Chambers
under seal along with the briefing but inadvertently was not also
formally filed under seal with the Clerk of the Court, as the
vicarious liability ibrief had been.
Dr. Enrico Bondi and Parmalat Capital Finance Limited have asked
that a joint corrective sealed filing of the in pari delicto
ibrief be made to complete the sealed vault index record for their
appeals. Ms. Coberly says that the Grant Thornton defendants have
no objection to the proposal.
Accordingly, Ms. Coberly, on behalf of the Grant Thornton
defendants, Dr. Bondi and the other parties, asks that the in pari
delicto ibrief be filed in the vault and remain under seal. In
the interest of completeness, the parties make the same request
with regard to the ibrief submitted to the Court in respect to
that certain "Daubert motion concerning the four Italian experts."
Ms. Coberly assures Judge Kaplan that Grant Thornton
International, Bank of America, Dr. Bondi, and Parmalat Capital
all agree with the proposal.
Judge Kaplan approved the proposal, provided that counsel will
furnish another copy of the ibrief for filing. The Court reserves
the right to unseal any or all of the sealed materials.
* * *
In accordance with the Court's directive, James L. Bernard, Esq.,
at Stroock & Stroock & Lavan, LLP, in New York, relates that they
attempted to file under seal with the Clerk of the Court two DVDs
containing copies of the electronic ibriefs. Mr. Bernard is Grant
Thornton's counsel.
The Clerk, however, said that even though the Court previously
were able to accept those filings, it can no longer accept filings
in DVD format without a directive from the Court.
Accordingly, Grant Thornton sought and obtained a Court order
directing the Clerk to accept the DVDs.
Grant Thornton subsequently filed under seal the ibriefs.
About Parmalat S.p.A.
Headquartered in Milan, Italy, Parmalat S.p.A. --
http://www.parmalat.net/-- sells nameplate milk products
that can be stored at room temperature for months. It also has
about 40 brand product lines, which include yogurt, cheese,
butter, cakes and cookies, breads, pizza, snack foods and
vegetable sauces, soups and juices.
The Company's U.S. operations filed for Chapter 11 protection on
February 24, 2004 (Bankr. S.D.N.Y. Case No. 04-11139). Gary
Holtzer, Esq., and Marcia L. Goldstein, Esq., at Weil Gotshal &
Manges LLP, represent the Debtors. When the U.S. Debtors filed
for bankruptcy protection, they reported more than US$200 million
in assets and debts. The U.S. Debtors emerged from bankruptcy on
April 13, 2005.
Parmalat S.p.A. and its Italian affiliates filed separate
petitions for Extraordinary Administration before the Italian
Ministry of Productive Activities and the Civil and Criminal
District Court of the City of Parma, Italy on December 24, 2003.
Dr. Enrico Bondi was appointed Extraordinary Commissioner in
each of the cases. The Parma Court has declared the units
insolvent.
On June 22, 2004, Dr. Bondi filed a Sec. 304 Petition, Case No.
04-14268, in the United States Bankruptcy Court for the Southern
District of New York.
Parmalat has three financing arms: Dairy Holdings Ltd., Parmalat
Capital Finance Ltd., and Food Holdings Ltd. Dairy Holdings and
Food Holdings are Cayman Island special-purpose vehicles
established by Parmalat S.p.A. The Finance Companies are under
separate winding up petitions before the Grand Court of the Cayman
Islands. Gordon I. MacRae and James Cleaver of Kroll (Cayman)
Ltd. serve as Joint Provisional Liquidators in the cases. On
January 20, 2004, the Liquidators filed Sec. 304 petition, Case
No. 04-10362, in the United States Bankruptcy Court for the
Southern District of New York. In May 2006, the Cayman Island
Court appointed Messrs. MacRae and Cleaver as Joint Official
Liquidators. Gregory M. Petrick, Esq., at Cadwalader, Wickersham
& Taft LLP, and Richard I. Janvey, Esq., at Janvey, Gordon,
Herlands Randolph, represent the Finance Companies in the Sec. 304
case.
The Honorable Robert D. Drain presided over the Parmalat Debtors'
U.S. cases. On June 21, 2007, the U.S. Court granted Parmalat
permanent injunction.
PARMALAT SPA: MacKenzie Cundill Wants Dividends From $1.5BB Deal
---------------------------------------------------------------
Parmalat S.p.A.'s largest investor, Mackenzie Cundill Investment
Management Ltd., wants the company to turn over the $1.5 billion
left over from lawsuit settlements to shareholders through stock
buybacks or dividends, Armorel Kenna of Bloomberg News reports.
As previously reported, Parmalat has reached certain settlements
with various parties, including the $100 million settlement
reached with Bank of America Corporation, Bank of America National
Trust & Savings Association, Bank of America N.A, Banc of America
Securities, LLC, Banc of America Securities Limited, Bank of
America International Ltd. and other Bank of America related
entities.
"Mackenzie Cundill would prefer to see cash returned to
shareholders in the form of share repurchases or dividends,"
rather than being spent on mergers and acquisitions, David Tiley
of Mackenzie Cundill is quoted by Bloomberg as saying. He said
that fund holds more than 7.7% of Parmalat and may buy more.
According to Parmalat's draft annual report filed February 25,
2010, Parmalat distributes approximately 178 million euros in
dividends equal to 0.104 euros per share. The draft report also
reveals that Parmalat Group's net profit in 2009 was 519 million
euros.
Mr. Tiley said that Parmalat could pay an extraordinary dividend,
which must be approved at a shareholders meeting, Bloomberg
reports. He added that Mackenzie Cundill would like to see the
cash turned over "expeditiously," and that Parmalat should retain
as much money as it needs to run its business.
"The company is clearly overcapitalized today and shareholders,
management, branded competitors and private equity all know it,"
Mr. Tiley further said.
About Parmalat S.p.A.
Headquartered in Milan, Italy, Parmalat S.p.A. --
http://www.parmalat.net/-- sells nameplate milk products
that can be stored at room temperature for months. It also has
about 40 brand product lines, which include yogurt, cheese,
butter, cakes and cookies, breads, pizza, snack foods and
vegetable sauces, soups and juices.
The Company's U.S. operations filed for Chapter 11 protection on
February 24, 2004 (Bankr. S.D.N.Y. Case No. 04-11139). Gary
Holtzer, Esq., and Marcia L. Goldstein, Esq., at Weil Gotshal &
Manges LLP, represent the Debtors. When the U.S. Debtors filed
for bankruptcy protection, they reported more than US$200 million
in assets and debts. The U.S. Debtors emerged from bankruptcy on
April 13, 2005.
Parmalat S.p.A. and its Italian affiliates filed separate
petitions for Extraordinary Administration before the Italian
Ministry of Productive Activities and the Civil and Criminal
District Court of the City of Parma, Italy on December 24, 2003.
Dr. Enrico Bondi was appointed Extraordinary Commissioner in
each of the cases. The Parma Court has declared the units
insolvent.
On June 22, 2004, Dr. Bondi filed a Sec. 304 Petition, Case No.
04-14268, in the United States Bankruptcy Court for the Southern
District of New York.
Parmalat has three financing arms: Dairy Holdings Ltd., Parmalat
Capital Finance Ltd., and Food Holdings Ltd. Dairy Holdings and
Food Holdings are Cayman Island special-purpose vehicles
established by Parmalat S.p.A. The Finance Companies are under
separate winding up petitions before the Grand Court of the Cayman
Islands. Gordon I. MacRae and James Cleaver of Kroll (Cayman)
Ltd. serve as Joint Provisional Liquidators in the cases. On
January 20, 2004, the Liquidators filed Sec. 304 petition, Case
No. 04-10362, in the United States Bankruptcy Court for the
Southern District of New York. In May 2006, the Cayman Island
Court appointed Messrs. MacRae and Cleaver as Joint Official
Liquidators. Gregory M. Petrick, Esq., at Cadwalader, Wickersham
& Taft LLP, and Richard I. Janvey, Esq., at Janvey, Gordon,
Herlands Randolph, represent the Finance Companies in the Sec. 304
case.
The Honorable Robert D. Drain presided over the Parmalat Debtors'
U.S. cases. On June 21, 2007, the U.S. Court granted Parmalat
permanent injunction.
PARMALAT SPA: U.S. Court Dismisses Complaint Against BofA
---------------------------------------------------------
Judge Lewis A. Kaplan of the U.S. District Court for the Southern
District of New York dismissed the complaint filed by Food
Holdings Limited and Dairy Holdings Limited against Bank of
America Corp., Bank of America, N.A., and Banc of America
Securities, LLC, which case is consolidated in Parmalat S.p.A.'s
multidistrict litigation.
In his 57-page opinion, Judge Kaplan related that the case had its
genesis in the desire of Parmalat to raise money by selling a
minority of the stock of its Brazilian subsidiary, Parmalat
Administracao, at a time when that stock could not be sold in
equity markets. BofA conceived of and Parmalat engaged in a pair
of matched transactions that were intended to provide off-balance
sheet debt financing to bridge the gap until the Parmalat Brazil
stock could be sold on attractive terms. BofA arranged for the
creation of two special purpose entities, FHL and DHL that would
exist only on paper and only for the purpose of completing the
transaction.
The SPEs would (i) borrow $300 million from institutional
investors, and (ii) buy the Parmalat Brazil stock from Parmalat
Brazil for $300 million. The debt eventually was to have been
repaid with the proceeds of the sale by the SPEs of the Parmalat
Brazil stock.
To make the SPEs' notes salable, BofA recommended and Parmalat
provided two additional sources of funds to pay the debt in the
event the Parmalat Brazil stock could not be sold at a price
sufficient to satisfy the notes. Thus, the ability of the
institutional investors to be repaid depended upon any one of
three conditions being satisfied: (1) the successful sale of the
SPEs' Parmalat Brazil stock for at least $300 million, (2) the
performance by Parmalat Capital Finance Limited of its obligations
under a "put" option, or (3) Parmalat's performance of its
guarantee of PCFL's obligation.
In the end, none of these conditions was satisfied because the
structure failed. The institutional investors, chief among them
BofA, which had bought $165 million of the notes, were left
holding the bag, Judge Kaplan noted.
"In hindsight, the reasons for this debacle are plain. Even when
the deal closed, the likelihood that the Parmalat Brazil stock was
worth or, in any reasonable time frame, likely to be
worth $300 million was uncertain at best. The only apparently
solid sources of funds to repay the debt issued by the SPEs were
the PCFL put and the Parmalat guarantee," Judge Kaplan said. "But
Parmalat and its entire organization, including PCFL, collapsed in
December 2003 upon the discovery of a massive fraud," he added.
This case is particularly interesting because the plaintiffs are
the SPEs created by BofA, who claim that they were defrauded and
otherwise wronged by the entity that created them and that held a
majority of the debt they issued, Judge Kaplan noted. The SPEs
argue that they would not have bought the overvalued Parmalat
Brazil stock in the first place if they had known the truth
regarding Parmalat Brazil and BofA's internal assessments of the
deal.
SPEs formed to engage in structured finance transactions, like FHL
and DHL, have no past, no future, and no employees, Judge Kaplan
explained. They are creatures of the financial services companies
that cause their creation. They are phantoms, endowed by law with
legal personality but having no real existence, he added. He
maintained that the questions whether the SPEs could have been
deceived or whether they would have acted differently if only one
or another piece of information had been fully and fairly
disclosed therefore arise in a context rather different from that
of the usual fraud or breach of fiduciary duty case.
"In the last analysis, I conclude that BofA did not commit fraud
because it lacked culpable intent. In the particular
circumstances of this case, however, BofA owed the SPEs fiduciary
duties and breached them by failing to disclose all material
facts," Judge Kaplan opined. "But the SPEs were not injured
because they never considered the business merits of this deal in
the first place and would have gone forward regardless of any
other or additional disclosures by BofA," he continued.
The conclusion, however, Judge Kaplan submitted, would be almost
inconceivable if the controversy had arisen between substantial
and responsible companies. Judge Kaplan went on to explain that
the SPE "directors," who nominally approved the deal, were hired
by BofA for a fee, and made no serious business judgment as to the
desirability of the deal from the SPEs' standpoint.
The SPE directors were engaged to vote "yes," and they did. "This
they would have done even if the allegedly concealed information
had been disclosed to them. Hence, there is no causal
relationship between BofA's breach of fiduciary duty and any
injury suffered by the SPEs," Judge Kaplan opined.
FHL and DHL's unjust enrichment claim fails for the independent
reason that valid agreements cover the subject matter that gives
rise to the alleged enrichment, Judge Kaplan further explained,
among other things. He noted that BofA's relationship with FHL
and DHL and its obligations as arranger are governed by the
transaction agreements, including the management and note purchase
agreements. Hence, FHL and DHL's claim for unjust enrichment must
be dismissed.
In another filing, Judge Kaplan ordered the substitution of two
pages of his opinion with new pages due to certain corrections.
About Parmalat S.p.A.
Headquartered in Milan, Italy, Parmalat S.p.A. --
http://www.parmalat.net/-- sells nameplate milk products
that can be stored at room temperature for months. It also has
about 40 brand product lines, which include yogurt, cheese,
butter, cakes and cookies, breads, pizza, snack foods and
vegetable sauces, soups and juices.
The Company's U.S. operations filed for Chapter 11 protection on
February 24, 2004 (Bankr. S.D.N.Y. Case No. 04-11139). Gary
Holtzer, Esq., and Marcia L. Goldstein, Esq., at Weil Gotshal &
Manges LLP, represent the Debtors. When the U.S. Debtors filed
for bankruptcy protection, they reported more than US$200 million
in assets and debts. The U.S. Debtors emerged from bankruptcy on
April 13, 2005.
Parmalat S.p.A. and its Italian affiliates filed separate
petitions for Extraordinary Administration before the Italian
Ministry of Productive Activities and the Civil and Criminal
District Court of the City of Parma, Italy on December 24, 2003.
Dr. Enrico Bondi was appointed Extraordinary Commissioner in
each of the cases. The Parma Court has declared the units
insolvent.
On June 22, 2004, Dr. Bondi filed a Sec. 304 Petition, Case No.
04-14268, in the United States Bankruptcy Court for the Southern
District of New York.
Parmalat has three financing arms: Dairy Holdings Ltd., Parmalat
Capital Finance Ltd., and Food Holdings Ltd. Dairy Holdings and
Food Holdings are Cayman Island special-purpose vehicles
established by Parmalat S.p.A. The Finance Companies are under
separate winding up petitions before the Grand Court of the Cayman
Islands. Gordon I. MacRae and James Cleaver of Kroll (Cayman)
Ltd. serve as Joint Provisional Liquidators in the cases. On
January 20, 2004, the Liquidators filed Sec. 304 petition, Case
No. 04-10362, in the United States Bankruptcy Court for the
Southern District of New York. In May 2006, the Cayman Island
Court appointed Messrs. MacRae and Cleaver as Joint Official
Liquidators. Gregory M. Petrick, Esq., at Cadwalader, Wickersham
& Taft LLP, and Richard I. Janvey, Esq., at Janvey, Gordon,
Herlands Randolph, represent the Finance Companies in the Sec. 304
case.
The Honorable Robert D. Drain presided over the Parmalat Debtors'
U.S. cases. On June 21, 2007, the U.S. Court granted Parmalat
permanent injunction.
PCAA PARENT: Wins Final Nod for $5 Million DIP Financing
--------------------------------------------------------
PCAA Parent, LLC and its units obtained final approval from the
Hon. Mary F. Walrath of the U.S. Bankruptcy Court for the District
of Delaware to obtain up to $5 million of postpetition secured
financing from a syndicate of lenders led by ING Real Estate
Finance (USA) LLC, as administrative agent.
The attorney for the Debtors -- Mark D. Collins, Esq., at
Richards, Layton & Finger, P.A., and Matthew S. Barr, Esq., at
Milbank, Tweed, Hadley & McCloy LLP -- explained that the Debtors
need the money to fund their Chapter 11 case, pay suppliers and
other parties.
The DIP facility will mature 150 days from the petition date.
PCAA is scheduled to present on May 14 its Chapter 11 plan. The
plan is based upon a sale of the business, as Bainbridge ZKS -
Corinthian Holdings LLC has offered $111.5 million. An auction,
where Bainbridge would be the stalking horse bidder is scheduled
for April 20.
Under the Plan, secured lenders, owed about $199.5 million, would
get the proceeds related to the sale of its underlying collateral.
No projected recovery was given. Two other groups of secured
creditors -- Chicago and RCL creditors -- would get full payment
of their $6 million in cash from the sale of the assets pledged as
their collateral.
Unsecured creditors would share "distributable value" ascribed to
the specific company units they hold a claim against. They would
also split 25,000 of the sale proceeds, any remaining assets and
any potential lawsuits.
About PCAA
Essington, Pennsylvania-based PCAA Parent, LLC, runs the largest
domestic off-site airport parking business, operating 31 off-site
airport parking facilities comprising over 40,000 parking spaces
near 20 major airports across the U.S. The Company owns or leases
its off-airport parking facilities in, among other states,
California, Arizona, Colorado, Texas, Georgia, Tennessee,
Pennsylvania, Connecticut, New York, New Jersey, and Illinois.
The Company filed for Chapter 11 bankruptcy protection on
January 28, 2010 (Bankr. D. Delaware Case No. 10-10250). John
Henry Knight, Esq.; Lee E. Kaufman, Esq.; and Mark D. Collins,
Esq.; and Zachary I. Shapiro, Esq., at Richards, Layton & Finger,
P.A., assist the Company in its restructuring effort. The Company
listed $50,000,001 to $100,000,000 in assets and $100,000,001 to
$500,000,000 in liabilities.
The Company's affiliates -- PCAA Chicago, LLC; Parking Company of
America Airports, LLC; PCA Airports, Ltd.; PCAA GP, LLC; Parking
Company of America Airports Phoenix, LLC; RCL Properties, LLC;
PCAA LP, LLC; PCAA Properties, LLC; Airport Parking Management,
Inc.; PCAA SP-OK, LLC; PCAA SP, LLC; PCAA Oakland, LLC; and PCAA
Missouri, LLC -- filed separate Chapter 11 bankruptcy petitions.
PETER POCKLINGTON: Bankruptcy Fraud Trial Set for June 29
---------------------------------------------------------
The National Post in Edmonton, Canada, reports that the oft-
postponed bankruptcy-fraud trial of former Edmonton Oilers owner
Peter Pocklington has been set for June 29 in Riverside, Calif.
The trial was delayed three times last year and again in January.
Mr. Pocklington is being accused of concealing assets when he
filed for bankruptcy. The Globe & Mail relates that
Mr. Pocklington has pleaded not guilty to the two-count felony
indictment that accuses him of filing false personal bankruptcy
declarations and making false oaths.
Mr. Pocklington owned the Edmonton Oilers of the National Hockey
League. He declared bankruptcy in 2008, citing assets of $2,900
and liabilities of $19.7 million.
As reported by the TCR on March 13, 2009, authorities arrested Mr.
Pocklington in the U.S. for allegedly hiding assets during his
bankruptcy. U.S. Attorney Thomas O'Brien in Los Angeles said in a
statement that Mr. Pocklington is accused of making false
statements and false oaths when he filed for bankruptcy in August
2008 and faces as long as 10 years in prison if convicted.
PRESTIGE AMERICAN: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Prestige American Homes, Ltd.
P.O. Box 814769
Dallas, TX 75381
Bankruptcy Case No.: 10-31438
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Stacey G. Jernigan
Debtor's Counsel: Jesse Blanco, Esq.
Law Offices of Jesse Blanco & Associates
P.O. Box 680875
San Antonio, TX 78268
Tel: (210) 509-6925
Fax: (210) 509-6903
Email: blancolaw@gmail.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
According to the schedules, the Company has assets of $2,796,188,
and total debts of $1,944,379.
A full-text copy of the Debtor's petition, including a list of its
20 largest unsecured creditors, is available for free at:
http://bankrupt.com/misc/txnb10-31438.pdf
The petition was signed by Ash Abraham, manager the Company.
PRESTIGE LANDING: Case Summary & 8 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Prestige Landing, L.P.
3010 Frankford Road
Dallas, TX 75287
Bankruptcy Case No.: 10-31440
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Harlin DeWayne Hale
Debtor's Counsel: Jesse Blanco, Esq.
Law Offices of Jesse Blanco & Associates
P.O. Box 680875
San Antonio, TX 78268
Tel: (210) 509-6925
Fax: (210) 509-6903
Email: blancolaw@gmail.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
According to the schedules, the Company has assets of $4,968,000,
and total debts of $3,064,482.
A full-text copy of the Debtor's petition, including a list of its
8 largest unsecured creditors, is available for free at:
http://bankrupt.com/misc/txnb10-31440.pdf
The petition was signed by Ash Abraham, partner the Company.
PROVO CRAFT: Moody's Assigns 'B2' Corporate Family Rating
---------------------------------------------------------
Moody's Investors Service assigned an initial B2 corporate family
and probability of default ratings to Provo Craft & Novelty, Inc.
Moody's also assigned a B1 rating to Provo Craft's new senior
secured credit facilities (LGD3, 34%). Proceeds from the new
credit facility and new mezzanine financing will help fund BAML
Capital Partners' acquisition of Provo Craft. The rating outlook
is stable.
Provo Craft's B2 corporate family rating reflects its modest
scale, narrow product focus, presence in niche segments of the
crafts industry, and the Cricut product's relatively short track
record within the craft industry. Alternatively, supporting Provo
Craft's ratings are its attractive operating margins, moderate
leverage at the transaction's inception and sizable equity
contribution. Also supporting the ratings are its good growth
prospects in mostly untapped niche markets, notably paper cutting
and cake decorating as well as customer diversification. The
acquired business grew approximately 21% in 2009 despite the
product's high price point and a very challenging economic
environment in the US.
The stable outlook reflects Provo Craft's good operating
performance and resilience through the challenging economic
downturn. The stable outlook also considers Moody's expectation
of still good top-line growth (lower levels of machines and higher
levels of cartridges) as the company continues to grow its
consumer base in 2010, success in the launch of its new Cricut
Cake into the cake decorating segment and strengthening credit
metrics.
These ratings were assigned:
* Corporate family rating at B2;
* Probability-of-default rating at B2;
* $50 million senior secured revolving credit facility due 2015,
at B1 (LGD3, 34%);
* $120 million senior secured term loan due 2016, at B1 (LGD3,
34%);
The rating outlook is stable.
Headquartered in Spanish Fork, Utah, Provo Craft & Novelty Inc.,
is a leading designer and marketer of electronic cutting systems
as well as a line of other crafts. The company reported sales of
approximately $262 million for the twelve months ended
December 31, 2009. Provo Craft's equity sponsors are BAML Capital
Partners and Sorenson Capital.
PURPLE COMMUNICATIONS: Files Emergency Stay Request with FCC
------------------------------------------------------------
Purple Communications(TM), Inc., has filed an Emergency Stay
Request and Application for Review with the Federal Communications
Commission (FCC) in order to grant the company due process
regarding the FCC's withholding of funds owed to Purple.
Background
On February 25, 2010, the FCC issued a Declaratory Ruling
addressing certain types of calls that are not compensable under
the Telecommunications Relay Services program administered by the
FCC. The Declaratory Ruling applies to all providers and is
purported to clarify prior rules the FCC believes have been clear,
thereby making its applicability retroactive.
Although Purple agrees with the objectives of the FCC; 1) to
ensure the integrity of the TRS Fund; 2) to eliminate potential
"double dipping" opportunities for providers who employ the deaf
and who also use their services in the performance of their work-
related obligations; and 3) the need for clarification of the
types of calls that are compensable from the TRS Fund, Purple does
not concur with the recent actions that the FCC has taken in the
name of achieving those objectives.
Purple, deaf consumer organizations, and other providers have long
been on record requesting that the FCC provide clarifications as
to the permissibility of calls which are reimbursable under the
TRS program. As recently as August 2009, Purple and eight
national consumer organizations asked the FCC to open a rulemaking
process that would be transparent and allow for public discussion
on which types of calls should be permissible for reimbursement
under the TRS program. In September 2009, the Commission issued
an Order singling out calls between two or more deaf individuals
as being non-compensable from the TRS Fund. Although the February
25, 2010 Declaratory Ruling is purported to provide clarification
of prior rules the Commission felt were in force, it is unclear
why the FCC failed to take the opportunity in the September 2009
Order or earlier in order to clarify rules in the face of repeated
requests by the industry participants. Purple believes that many
of the newly issued clarifications are really new definitions of
rules that were not commonly understood among the industry. Also
not addressed in the September 2009 Order was the contemplation of
various options for reimbursing providers for reasonable expenses
incurred in connection with the processing of calls made by deaf
employees or contractors of relay providers, another issue on
which many, including Purple, have offered alternative cost
recovery approaches. In addition to issuing rules without a
formal rule-making process involving consumer and industry group
participation, the new rules are mandated as retroactive in effect
for all industry providers.
Reason for the Emergency Stay and Appeal Request
In addition to the ruling, the FCC has issued Purple a demand
letter requesting reimbursement for call types that were processed
in 2008 and 2009 for which are now defined under the February 25,
2010 Declaratory Ruling as non-compensable. The FCC also notified
Purple of its intention to withhold all compensation to the
company, regardless of whether the compensation is related to
permissible calls or not, until a resolution is reached regarding
monies the FCC believes are owed back to the TRS Fund. These
extreme actions by the FCC will result in a cessation of all
operations if resolution cannot quickly be achieved.
Immediate Impact on Purple and its Deaf and Hard of Hearing
Customers
As part of its cooperation with the FCC, Purple believed it was on
a track of negotiating a global settlement agreement related to
all historical inquiries; however, absent an immediate release of
funds, Purple will soon be insolvent, forcing either a bankruptcy
proceeding or liquidation of Purple. A liquidation of Purple
would result in a loss of more than 1,000 jobs, a significant
percentage of which are held by deaf or hard of hearing employees
and the termination of all relay- and on-site interpreting
services provided to the deaf community. This action could result
in serious public safety issues in the event the traffic handled
by Purple is unable to be readily absorbed in the market by
remaining providers, particularly text relay services where Purple
is the largest provider, or its interpreting services, which are
provided to hospitals and other urgent care and medical
operations.
Through its Emergency Stay Request and Appeal, Purple is seeking
an immediate release of funds, which match the description of
compensable calls under the new Declaratory Ruling that would
allow a proper settlement to be negotiated in due course and would
afford the company the natural due process it is entitled to.
"The retroactive impact of the ruling and related financial
clawbacks could be financially devastating for the industry,
particularly smaller providers who employ the deaf. Too, this
could further exacerbate a market structure problem with a single
provider having complete domination over the market," said Dan
Luis, Purple's CEO.
"Purple is proud to be an employer of hundreds of deaf and hard of
hearing employees and community outreach representatives. The
cost to provide the same level of telecommunications access to a
deaf employee as to a hearing employee is significantly higher. As
long as providers are allowed to recover the full costs to provide
this access, we can make this element of the Declaratory Ruling
work; however, we also believe that this ruling could be a civil
rights setback as it places a discriminatory burden on deaf and
hard of hearing employees of TRS providers, which could lead to
the loss of jobs and reduced employment opportunities among the
deaf in a field that serves their community," added Ronald E.
Obray, Purple's vice chairman.
"Ultimately, deaf and hard of hearing consumers could become the
victims due to this ruling. This decision could potentially
annihilate any small-VRS provider that employs the deaf, which
would prevent a choice in providers and the incentive to innovate.
A VRS provider should not have to make a business decision to not
hire deaf or hard of hearing employees, as the cost for their
rights of functional equivalency is too high," said Kelby Brick,
Purple's Vice President of Regulatory and Strategic Policy.
About Purple
Purple Communications is a leading provider of onsite interpreting
services, video relay and text relay services, and video remote
interpreting, offering a wide array of options designed to meet
the varied communication needs of its customers. Purple's vision
is to enable free-flowing communication between people, inclusive
of differences in abilities, languages, or locations. For more
information on Purple or its services, visit www.purple.us, by
Internet relay by visiting www.ip-relay.com, or by video phone by
connecting to purple.tv.
"i711," "Purple," and the Purple logo are registered trademarks of
Purple Communications, Inc. "Purple Mail," "Powered by Purple,"
"i711.com," "My IP-Relay," "IP-Relay.com," "One-Tap Redial," and
"P3" are either registered trademarks, trademarks, or service
marks of Purple Communications, Inc. Other names may be trademarks
of their respective owners.
RADIENT PHARMACEUTICALS: Board Adopts Financial Stabilization Plan
------------------------------------------------------------------
The Board of Directors of Radient Pharmaceuticals Corporation is
seeking stockholder approval at a Special Shareholders Meeting on
April 8, 2010, of a Financial Stabilization Plan. The Plan is
focused around building upon a highly improved balance sheet,
eliminating up to roughly $6.3 million in debt, infusing roughly
$10 million in new equity from long-term institutional investors
and creating a new stock option plan that will incentivize
management and employees to drive the Company's In-vitro
Diagnostics business to new heights in sales and profitability in
2010 and beyond.
The Financial Stabilization Plan calls for the issuance of up to:
30,000,000 shares of common stock in connection with a
potential offering of either common stock,
convertible preferred stock, convertible debt or
warrants to purchase common stock, to one or a
limited number of third-party, accredited
investors;
13,096,386 shares of common stock in exchange for the
cancellation of all principal amount of the
outstanding 12% Series 1 Notes the Company issued
in December 2008 and January 2009, and the Series
2 Notes issued in May 2009 and June 2009;
6,719,617 shares of common stock in exchange for the
cancellation of outstanding 10% Convertible
Promissory Notes issued in September 2008. The
exchanging 10% Note Holders will also receive
five-year warrants to purchase up to 2,901,323
shares of common stock;
1,755,239 shares of common stock in exchange for the
cancellation of outstanding 12% promissory note
issued on September 15, 2009, to St. George
Investments, LLC;
404,526 shares of common stock in exchange for the
cancellation of outstanding Bridge Note issued in
September 2009;
514,286 shares of common stock in exchange for cash
consulting fees due under the Consulting Agreement
with Cantone Asset Management, LLC;
343,535 shares of common stock to the placement agents of
the 10% Convertible Notes and the Series 1 and 2
Notes in consideration for their efforts in
connection with obtaining the note holders'
consent to the exchange agreements;
5,697,513 shares of common stock for the exercise of
outstanding warrants issued pursuant to the
Registered Direct2009 Offering.
In a proxy statement filed with the Securities and Exchange
Commission, the Company said it is carrying an aggregate of
$7,900,000 of indebtedness that is in default, or is due on
outstanding notes and other contractual obligations which are past
due or soon to be due. Management is concerned the Company may
not have sufficient cash to satisfy the debts and carry on the
Company's current operations.
At the Special Meeting, the shareholders will also be asked to
approve an amendment to the Company's Certificate of Incorporation
to increase the authorized number of shares of common stock by
100,000,000 shares of common stock for a total of 200,000,000
shares of authorized common stock. The shareholders will also be
asked to approve the Company's 2010 Performance and Equity
Incentive Plan providing for the Company's issuance of options to
purchase 6,000,000 shares of common stock.
A full-text copy of the proxy statement for the Special Meeting as
well as additional discussion on the Stabilization Plan is
available at no charge at http://ResearchArchives.com/t/s?562a
About Radient Pharmaceuticals
Headquartered in Tustin, California, Radient Pharmaceuticals
Corporation, formerly AMDL, Inc., is an integrated pharmaceutical
company devoted to the research, development, manufacturing, and
marketing of diagnostic, and premium skin care products.
At September 30, 2009, the Company had $26,160,438 in total assets
against $4,927,694 in total liabilities. The September 30 balance
sheet showed strained liquidity: The Company had $246,048 in total
current assets against $2,950,658 in total current liabilities.
Going Concern Qualification
On April 15, 2009, Radient Pharmaceuticals (formerly AMDL, Inc.)
filed with the SEC an Annual Report on Form 10-K in which included
an audit opinion with a "going concern" explanatory paragraph
which expresses doubt, based upon current financial resources, as
to whether AMDL can meet its continuing obligations without access
to additional working capital.
On December 11, 2009, Radient entered into a Waiver of Default
agreement with St. George Investments, LLC, pursuant to which St.
George waived all defaults under a 12% promissory note in the
principal amount of $555,555.56 through February 1, 2010 and
agreed not to accelerate any amounts due under the St. George Note
before February 1, 2010.
RADIENT PHARMACEUTICALS: RAB Fund Holds Less Than 5% of Shares
--------------------------------------------------------------
RAB Special Situations (Master) Fund Limited of George Town,
Cayman Islands, disclosed that as of December 31, 2009, it held
warrants to acquire 342,809 shares of Radient Pharmaceuticals
Corporation common stock. RAB said it may be deemed to held less
than 5% of the Company's common stock.
About Radient Pharmaceuticals
Headquartered in Tustin, California, Radient Pharmaceuticals
Corporation, formerly AMDL, Inc., is an integrated pharmaceutical
company devoted to the research, development, manufacturing, and
marketing of diagnostic, and premium skin care products.
At September 30, 2009, the Company had $26,160,438 in total assets
against $4,927,694 in total liabilities. The September 30 balance
sheet showed strained liquidity: The Company had $246,048 in total
current assets against $2,950,658 in total current liabilities.
Going Concern Qualification
On April 15, 2009, Radient Pharmaceuticals (formerly AMDL, Inc.)
filed with the SEC an Annual Report on Form 10-K in which included
an audit opinion with a "going concern" explanatory paragraph
which expresses doubt, based upon current financial resources, as
to whether AMDL can meet its continuing obligations without access
to additional working capital.
On December 11, 2009, Radient entered into a Waiver of Default
agreement with St. George Investments, LLC, pursuant to which St.
George waived all defaults under a 12% promissory note in the
principal amount of $555,555.56 through February 1, 2010 and
agreed not to accelerate any amounts due under the St. George Note
before February 1, 2010.
RAFAELLA APPAREL: Tender Offer Won't Affect Moody's Ratings
-----------------------------------------------------------
Moody's Investors Service announced that Rafaella Apparel Group,
Inc.'s ratings are unchanged following the announcement that the
company has commenced a Modified Dutch Auction tender offer to
purchase for cash up to $36,380,000 principal amount at maturity
(but not less than $17,975,000) of its 11-1/4% Senior Secured
Notes due 2011. Proceeds from the transaction will be sourced
from balance sheet cash and borrowings to be available upon the
effectiveness of an amended and restated credit facility
agreement, which will include up to $10 million from a term loan
provided by an affiliate of Rafaella's controlling stockholder, RA
Cerberus Acquisition, LLC.
Moody's will likely consider the proposed transaction to be a
distressed exchange. Without the transaction, in Moody's view,
Rafaella's capital structure is unsustainable due to the
persistent declines in revenue and cash flow stemming from past
customer consolidation and more recent declines in consumer
spending. Further, Moody's continues to view the company's
liquidity as weak given its significant near-to-intermediate term
debt maturities. Rafaella's revolving credit facility is due to
expire on December 15, 2010, but could be extended to April 1,
2011 upon consummation of the transaction. Rafaella's secured
notes mature on June 15, 2011. While the maturity date of the
notes will not change, the transaction, if successful, is expected
to reduce the amount of debt that will need to be refinanced by
that date.
Upon the conclusion of the tender offer, Moody's could revise the
ratings to reflect the post-exchange credit profile and, at that
time, will likely denote the limited default by adding the "/LD"
designation to the probability of default rating.
Rafaella's ratings and outlook are:
-- Corporate Family Rating: Caa3
-- Probability of Default Rating: Caa3
-- Senior secured notes due June 2011: Ca (LGD4, 62%)
-- The ratings outlook is negative.
The last rating action for Rafaella was on November 4, 2009, when
Moody's downgraded its CFR to Caa3 with a negative outlook.
Rafaella Apparel Group, Inc., based in New York, NY, is a
designer, sourcer, and marketer of a full line of women's career
and casual sportswear separates under the Rafaella brand. Net
sales for the twelve months ended December 31, 2009, were
$113 million.
RAHAXI INC: Reports $1.47-miL. Net Loss for Dec. 31 Quarter
-----------------------------------------------------------
Rahaxi, Inc., said net loss attributable to Rahaxi shareholders
was $1,467,006 for the three months ended December 31, 2009, from
a net loss of $5,199,590 for the 2008 quarter. Rahaxi said net
loss attributable to shareholders was $2,599,285 for the six
months ended December 31, 2009, from a net loss of $8,551,562 for
the 2008 period.
Total revenue was $1,436,156 for the three months ended
December 31, 2009, from $1,375,768 for the 2008 quarter. Total
revenue was $2,674,098 for the six months ended December 31, 2009,
from $2,622,253 for the 2008 period.
At December 31, 2009, the Company had total assets of $2,881,216
against total current liabilities of $6,102,244 and long-term
portion of notes payable of $887,977; resulting in stockholders'
deficit of $4,602,784.
The Company believes that anticipated revenues from operations
will be insufficient to satisfy its ongoing capital requirements
for the next 12 months. If the Company's financial resources are
insufficient, the Company will require additional financing in
order to execute its operating plan and continue as a going
concern. The Company cannot predict whether this additional
financing will be in the form of equity or debt, or be in another
form. The Company may not be able to obtain the necessary
additional capital on a timely basis, on acceptable terms, or at
all. In any of these events, the Company may be unable to
implement its current plans for expansion, repay its debt
obligations as they become due, or respond to competitive
pressures, any of which circumstances would have a material
adverse effect on its business, prospects, financial condition and
results of operations.
Management is pursuing all available options to provide the
Company with the ability to continue as a going concern. The
Company continues to pursue financing through the sale of its
stock in private placements to individual investors. However,
given the challenges presented by the current capital markets, as
well as the decline in the Company's stock price and the Company's
continued losses, management is considering a broader range of
options, which may include a registered offering for investors,
additional debt issuances or financings at the subsidiary level,
such as the sale of a portion of Rahaxi Processing Oy. The Company
may also pursue the acquisition of certain strategic industry
partners where appropriate.
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?55b1
Rahaxi, Inc., provides payment services and processing. Its
principal offices are in Wicklow, Ireland; the Company also has
offices in Helsinki, Finland; and Santo Domingo, the Dominican
Republic.
RANDALL PROPERTIES: Case Summary & 2 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Randall Properties, LLC
P.O. Box 4635
Dalton, GA 30719
Bankruptcy Case No.: 10-40802
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Northern District of Georgia (Rome)
Judge: Paul W. Bonapfel
Debtor's Counsel: Leon S. Jones, Esq.
Jones & Walden, LLC
21 Eighth Street, NE
Atlanta, GA 30309
Tel: (404) 564-9300
Fax: (404) 564-9301
Email: ljones@joneswalden.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including a list of its
2 largest unsecured creditors, is available for free at:
http://bankrupt.com/misc/ganb10-40802.pdf
The petition was signed by Ross Rogers, manager the Company.
RANJHA INC: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Ranjha Inc.
dba Best Buy Quality Foods
fka Ranzha, Inc.
5415 Atlanta Highway
Flowery Branch, GA 30542
Bankruptcy Case No.: 10-20936
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Northern District of Georgia (Gainesville)
Judge: Robert Brizendine
Debtor's Counsel: Herbert C. Broadfoot, II, Esq.
Ragsdale, Beals, Seigler, et al.
2400 International Tower
229 Peachtree Street, N.E.
Atlanta, GA 30303
Tel: (404) 588-0500
Fax: (404) 523-6714
Email: broadfoot@rbspg.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including a list of its
20 largest unsecured creditors, is available for free at:
http://bankrupt.com/misc/ganb10-20936.pdf
The petition was signed by Ghulam Ahmed, president the Company.
RAUL FLORES INC: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Raul Flores, Inc.
1714 E. Rabbit Run Ave.
Alton, TX 78573
Bankruptcy Case No.: 10-70161
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Southern District of Texas (McAllen)
Judge: Richard S. Schmidt
Debtor's Counsel: Antonio Villeda, Esq.
Attorney at Law
5414 N 10th St
McAllen, TX 78504
Tel: (956) 631-9100
Email: avilleda@mybusinesslawyer.net
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Company says it does not have unsecured creditors who are non
insiders when they filed their petition.
The petition was signed by Raul Flores, shareholder of the
Company.
REALTY AMERICA: Case Summary & 16 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Realty America Group (Parker) Medical, Office LP
c/o Keith W. Harvey
The Harvey Law Firm, P.C.
9550 Forest Lane, Suite 111
Dallas, TX 75243
Bankruptcy Case No.: 10-40698
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Eastern District of Texas (Sherman)
Debtor's Counsel: Keith Harvey, Esq.
9550 Forest Lane, Suite 111
Dallas, TX 75243
Tel: (972) 243-3960
Fax: (972) 341-3970
Email: harvey@keithharveylaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 16 largest unsecured creditors is
available for free at:
http://bankrupt.com/misc/txeb10-40698.pdf
The petition was signed by Webb M. Sowden III, manager of the
company.
REDDY ICE: Bank Nat'l Association Executes Supplemental Indenture
-----------------------------------------------------------------
Reddy Ice Holdings, Inc. and U.S. Bank National Association, the
trustee under the indenture governing the Company's 10 1/2% Senior
Discount Notes due 2012, executed a supplemental indenture to the
Indenture in order to effect the proposed amendments to the Old
Notes and the Indenture, as provided in the offering circular
dated February 22, 2010. The amendments, however, will not become
operative with respect to the Old Notes and the Indenture until
Reddy Ice Corporation, a Nevada corporation and wholly-owned
subsidiary of the Company, has accepted for exchange as of the
initial acceptance date at least a majority of the outstanding
aggregate principal amount of the Old Notes. As a result of the
execution of the Supplemental Indenture, Old Notes that have been
tendered prior to, or that are tendered after, the execution of
the Supplemental Indenture may not be withdrawn and the related
consents may not be revoked.
The exchange offer and consent solicitation will expire at 12:00
midnight, New York City time, on March 19, 2010, unless extended.
Holders tendering Old Notes will receive $1,000.00 principal
amount of new 13.25% senior secured notes due 2015 of Reddy Corp
for each $1,000 principal amount of their Old Notes that are
accepted for exchange, plus an additional $5.00 principal amount
of New Notes if their Old Notes are tendered at or prior to the
early tender date for the offer, which will be 5:00 p.m., New York
City time, on March 5, 2010, unless extended.
The exchange offer and consent solicitation is subject to certain
conditions, including the entry into a new revolving credit
facility by Reddy Corp, the termination and repayment of all
indebtedness under Reddy Corp's existing credit facility and the
issuance by Reddy Corp of new first lien notes in an amount
sufficient to refinance Reddy Corp's existing credit facility.
Reddy Corp has the right to waive these conditions or to terminate
or withdraw the exchange offer and consent solicitation at any
time and for any reason prior to the fulfillment or waiver of the
conditions to the offer.
About Reddy Ice
Reddy Ice Holdings, Inc. -- http://www.reddyice.com/--
manufactures and distributes packaged ice in the United States.
The company serves variety of customers in 31 states and the
District of Columbia under the Reddy Ice brand name. Its
principal product is ice packaged in seven to 50 pound bags,
which it sells to a diversified customer base, including
supermarkets, mass merchants and convenience stores. As of March
6, 2009, the company owned or operated 58 ice manufacturing
facilities, 67 distribution centers and approximately 3,100 Ice
Factories.
* * *
According to the Troubled Company Reporter on Feb. 23, 2010,
Moody's Investors Service assigned a B1 rating to Reddy Ice
Corporation's (a wholly owned subsidiary of Reddy Ice Holdings,
Inc.) proposed $300 million first lien senior secured notes due
2015. The company plans to use proceeds from the first lien notes
to refinance its existing $240 million senior secured term loan
due 2012 and for general corporate purposes.
REDONDO CONSTRUCTION: Court Revises Interest Calculation
--------------------------------------------------------
As reported in the Troubled Company Reporter on Sept. 18, 2009,
Redondo Construction Corporation brought three adversary
proceedings (Bankr. D. P.R. Adv. Pro. Nos. 03-0192, 03-0194 and
03-0195) against the Puerto Rico Highway and Transportation
Authority, claiming amounts due for work performed on three road
construction projects. The Honorable Gerardo A. Carlo, 411 B.R.
89, entered judgments in the debtor's favor. The Debtor moved to
amend Judge Carlo's decision, and the Transportation Authority
moved to alter or amend the judgments or, alternatively, for new
trial, WestLaw reports. Reviewing the post-judgment requests, the
Honorable Enrique S. Lamoutte orders that in Adv. Pro. No. 03-
0192, the Puerto Rico Highway and Transportation Authority is
liable to Redondo Construction Corporation in the amount of
$643,545.77, with prejudgment interest at 6.5% from February 27,
2007. In re Redondo Const. Corp., --- B.R. ----, 2010 WL 529430
(Bankr. D. P.R.).
Redondo Construction Corporation has been in the construction
business for thirty years, and worked on many public and
government projects. Redondo filed for chapter 11 protection
(Bankr. D. P.R. Case No. 02-02887) on March 19, 2002, and the
Bankruptcy Court confirmed the Debtor's chapter 11 plan on
October 6, 2005.
REGENT BROADCASTING: Moody's Affirms 'D' Default Rating
-------------------------------------------------------
Moody's Investors Service affirmed Regent Broadcasting LLC's
Probability of Default Rating of D and downgraded the Corporate
Family Rating to Caa3 following Regent's prearranged
reorganization filing with the U.S. Bankruptcy Court in the
District of Delaware effective March 1, 2010. This action
concludes the review for possible downgrade initiated on
January 6, 2010. The rating outlook is stable.
The Caa3 Corporate Family Rating reflects Moody's view on expected
lender recovery.
Subsequent to the actions, all ratings will be withdrawn. Moody's
will withdraw the ratings because the issuer has entered
bankruptcy.
These summarizes Moody's rating actions and current ratings:
Regent Broadcasting LLC
-- Corporate Family Rating, Downgraded to Caa3 from Caa1
-- Probability of Default Rating, Affirmed at D
-- Senior Secured Bank Credit Facility, Downgraded to Caa3 from
Caa1
-- Outlook, Changed To Stable From Rating Under Review
-- Speculative Grade Liquidity Rating, Unchanged at SGL-4
The last rating action for Regent occurred on January 6, 2010,
when Moody's downgraded the probability of default rating to D.
Regent Broadcasting LLC owns and operates 62 stations located in
13 markets.
RICHARD HAYES: Case Summary & 2 Largest Unsecured Creditors
-----------------------------------------------------------
Joint Debtors: Richard G. Hayes
Katherine M.K. Hayes
560 Southfield
Birmingham, MI 48009
Bankruptcy Case No.: 10-46251
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Eastern District of Michigan (Detroit)
Judge: Steven W. Rhodes
Debtors' Counsel: Kimberly Ross Clayson, Esq.
645 Griswold, Suite 3900
Detroit, MI 48226
Tel: (313) 237-0850
Email: kclayson@schneidermiller.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
According to the schedules, the Company has assets of $2,590,793
and total debts of $1,777,901.
A list of the Company's 2 largest unsecured creditors is available
for free at:
http://bankrupt.com/misc/mieb10-46251.pdf
The petition was signed by the Joint Debtors.
ROYAL WEST: Owners Face SEC Charges in $135-Mil. Ponzi Scheme
-------------------------------------------------------------
The Securities and Exchange Commission charged a Miami-based
business leader and his wife with fraud for conducting a $135
million Ponzi scheme with real estate investments from hundreds of
elderly Cuban-American investors living in South Florida.
The SEC alleges that Gaston E. Cantens and Teresita Cantens, the
founders and co-owners of real estate development company Royal
West Properties Inc., sold promissory notes to investors after
acquiring various properties and later financing their sale. The
Cantens lured investors by promising the investments in their real
estate business were safe and secure with annual returns between 9
and 16 percent. However, when property owners defaulted on their
mortgages, Royal West's financial condition deteriorated and the
Cantens used new investor money to repay earlier investors and
afford the firm's operating costs. The Cantens also
misappropriated more than $20 million from investors to fund
unrelated personal business ventures, pay themselves high
salaries, and divert money to their children and grandchildren.
The Cantens were not registered with the SEC under the federal
securities laws to make securities offerings to investors.
"The Cantens used their prominent standing in a close-knit Cuban-
American community to ruthlessly exploit vulnerable elderly
investors who trusted them with their life savings," said Eric I.
Bustillo, Director of the SEC's Miami Regional Office. "They
portrayed themselves as a pious couple closely involved with
educational and religious organizations, while in reality they
were living lavishly off money from defrauded investors."
According to the SEC's complaint, filed in U.S. District Court for
the Southern District of Florida, the Cantens gained the trust of
prospective investors in typical affinity fraud fashion by
cultivating an impression within their community that it was a
privilege to invest with them. The Cantens emphasized that Jesuit
priests and other well-known leaders in the Cuban-American
community had invested with Royal West. They targeted investors at
charitable and religious gatherings and at social functions in
their home. They also recruited investors through their contacts
with alumni and others associated with a local private boys'
school where Gaston Cantens served on the Board of Advisors.
Besides word of mouth, the Cantens also attracted potential
investors who learned of Royal West properties through television
commercials broadcast on Spanish-language channels nationwide.
The SEC alleges that the Cantens made numerous material
misrepresentations and omissions about the safety and security of
investors' principal and returns, the success of Royal West's
business, the source of purported investment returns, and the use
of investor funds. The Cantens told potential investors that
Royal West generated investors' returns through the sale of land
and its mortgage receivables business, which they claimed was
highly successful. The representations were false because Royal
West was not generating sufficient income from its real estate
business and mortgage receivables to pay its business expenses or
investors' principal and interest payments. By 2002, the Cantens
had resorted to using new investor funds to make principal and
interest payments to earlier investors. Even after Royal West
entered dire financial condition, the Cantens continued to falsely
tout their business as financially successful to attract new
investors and raise additional millions of dollars to continue the
Ponzi scheme.
The SEC further alleges that the Cantens falsely represented that
the promissory notes were collateralized by mortgages or mortgage
obligations. In fact, Royal West did not record as many as one-
third of the assignments of mortgage receivables that served to
collateralize investors' promissory notes. Royal West also
assigned the same mortgage receivables to multiple investors at
the same time.
The SEC's complaint charges the Cantens with violating the
securities registration and antifraud provisions of the federal
securities laws. The complaint seeks permanent injunctions, sworn
accountings, disgorgement of ill-gotten gains and financial
penalties against the Cantens.
SAWGRASS MARRIOTT: Global Economic Issue Prompts Bankruptcy Filing
------------------------------------------------------------------
According to First Coast News, Sawgrass Marriott Golf Resort & Spa
filed for Chapter 11 bankruptcy in response to the present global
economic environment and the agreement on a restructure with the
lenders could not be reached. The filing will protect the company
and allow it to continue to operate business as usual, says person
with knowledge of the filing.
Sawgrass Marriott Golf Resort & Spa operates a golf course.
SCO GROUP: To Sell Mobility Biz's Assets to McBride for $35,000
---------------------------------------------------------------
Nick Farrell at The Inquirer reports that a former federal judge
asked bankruptcy court to allow SCO Group sell off its assets
mobility business -- including mobile phone software programs and
copyrights, other intellectual property, and contracts plus one
for an Iphone Application Program with Apple -- the company's
former chief executive officer Darl McBride for $35,000.
The SCO Group (SCOXQ.PK) -- http://www.sco.com/-- is a leading
provider of UNIX software technology. Headquartered in Lindon,
Utah, SCO has a worldwide network of resellers and developers.
SCO Global Services provides reliable localized support and
services to partners and customers.
The Company and its affiliate, SCO Operations Inc., filed for
Chapter 11 protection on September 14, 2007 (Bankr. D. Del. Lead
Case No. 07-11337). Paul Steven Singerman, Esq., and Arthur
Spector, Esq., at Berger Singerman P.A., represent the Debtors in
their restructuring efforts. James O'Neill, Esq., and Laura Davis
Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, are the
Debtors' Delaware and conflicts counsel. Epiq Bankruptcy
Solutions LLC acts as the Debtors' claims and noticing agent.
The United States Trustee failed to form an Official Committee of
Unsecured Creditors in the Debtors' cases due to insufficient
response from creditors.
As of January 31, 2009, the Company had $8.78 million in total
assets and $13.30 million in total liabilities, resulting in
a $4.52 million in stockholders' deficit.
S.H. LEGGITT: Files Schedules of Assets & Liabilities
-----------------------------------------------------
S.H. Leggitt Company has filed with the U.S. Bankruptcy Court for
the Western District of Texas its schedules of assets and
liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ------ -----------
A. Real Property $1,795,294
B. Personal Property $14,073,726
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $3,903,060
E. Creditors Holding
Unsecured Priority
Claims $670,852
F. Creditors Holding
Unsecured Non-priority
Claims $6,830,440
------------- ------------
TOTAL $15,869,020 $11,404,353
San Marcos, Texas-based S.H. Leggitt Company aka Marshall Products
-- dba The Leggitt Group; Marshall Brass Company; and Marshall Gas
Controls, Inc. -- filed for Chapter 11 bankruptcy protection on
February 2, 2010 (Bankr. W.D. Texas Case No. 10-10279). Joseph D.
Martinec, Esq., at Martinec, Winn, Vickers & McElroy, P.C.,
assists the Company in its restructuring effort. The Company
listed $1,000,001 to $10,000,000 in assets and $10,000,001 to
$50,000,000 in liabilities.
S.H. LEGGITT: Section 341(a) Meeting Scheduled for March 10
-----------------------------------------------------------
The U.S. Trustee for Region 7 will convene a meeting of creditors
in S.H. Leggitt Company's Chapter 11 case on March 10, 2010, at
10:00 a.m. The meeting will be held at Austin Room 118, Homer
Thornberry Bldg., 903 San Jacinto, Austin, TX 78701.
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.
San Marcos, Texas-based S.H. Leggitt Company aka Marshall Products
-- dba The Leggitt Group; Marshall Brass Company; and Marshall Gas
Controls, Inc. -- filed for Chapter 11 bankruptcy protection on
February 2, 2010 (Bankr. W.D. Texas Case No. 10-10279). Joseph D.
Martinec, Esq., at Martinec, Winn, Vickers & McElroy, P.C.,
assists the Company in its restructuring effort. The Company
listed $1,000,001 to $10,000,000 in assets and $10,000,001 to
$50,000,000 in liabilities.
SHAFER PLAZA XXXVII: Case Summary & 1 Largest Unsecured Creditor
----------------------------------------------------------------
Debtor: Shafer Plaza XXXVII, Ltd.
5010 Tracy
Dallas, TX 75205
Bankruptcy Case No.: 10-41538
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Northern District of Texas (Ft. Worth)
Judge: D. Michael Lynn
Debtor's Counsel: Eric A. Liepins, Esq.
12770 Coit Rd., Suite 1100
Dallas, TX 75251
Tel: (972) 991-5591
Email: eric@ealpc.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor identified Tarrent County with a debt claim for an
unknown amount as its largest unsecured creditor. A full-text copy
of the Debtor's petition, including a list of its largest
unsecured creditor, is available for free at:
http://bankrupt.com/misc/txnb10-41538.pdf
The petition was signed by Steve Shafer, managing member of the
general partner of the Company.
SHEARIN FAMILY: Plan of Reorganization Wins Court Approval
----------------------------------------------------------
J. Rich Leonard of the U.S. Bankruptcy Court for the Eastern
District of North Carolina confirmed Shearin Family Investments,
LLC's Plan of Reorganization, subject to modifications in the
treatments of the Class 4-RBC Real Estate Finance Claim, and East
Carolina Bank claim.
A full-text copy of the confirmation order is available for free
at http://bankrupt.com/misc/ShearinInvestment_Plan_Order.pdf
As reported in the Troubled Company Reporter on January 13, 2010,
according to the DS, the amended and restated Plan contemplates a
continuation of the Debtor's business. The Debtor intends to
satisfy certain creditor claims from income earned through
continued operations. The Plan also contemplates the sale of the
real or personal property.
The Debtor proposes to make payments under the plan from funds on
hand and any distributions of net income from the operation of its
business.
Upon the sale of the real or personal property proposed to be
sold by this Plan, the liens secured by the property will attach
to the net proceeds of sale remaining after payment of all
reasonable and ordinary closing costs, and will be paid to
lienholders in accordance with this Plan and the priorities of the
Code.
A full-text copy of the Disclosure Statement is available for free
at http://bankrupt.com/misc/ShearinFamily_AmendedDS.pdf
A full-text copy of the Chapter 11 Plan is available for free at:
http://bankrupt.com/misc/ShearinFamily_AmendedPlan.pdf
About Shearin Family Investments
Based in Rocky Mount, North Carolina, Shearin Family Investments,
LLC owns and operates a condominium resort in Carteret County, in
North Carolina. The company filed for Chapter 11 relief on
Oct. 13, 2008 (Bankr. E.D. N.C. Case No. 08-07082). Amy M. Faber,
Esq., at Stubbs & Perdue, P.A., and Trawick H. Stubbs, Jr., Esq.,
at Stubbs & Perdue, P.A., represent the Debtor as counsel. When
the Debtor filed for protection from its creditors, it listed
assets of $46,327,546 and debts of $49,260,007.
SIX FLAGS: Creditors Committee Opposes Plan Confirmation
--------------------------------------------------------
The Official Committee of Unsecured Creditors in Six Flags Inc.'s
cases, as a representative of, and fiduciary for, unsecured
creditors at all levels of the Debtors' capital structure, tells
the Court that it believes its role is to work towards a fair
allocation of value amongst all those creditors while allowing the
Debtors to emerge promptly as an adequately capitalized and viable
business.
In this regard, the Creditors' Committee asks the Court to deny
confirmation of the Debtors' Fourth Amended Plan of
Reorganization contending that the Plan contains several fatal
flaws that, as a matter of law, render it incapable of
confirmation. The Plan defects noticed by the Creditors'
Committee include:
(a) the artificially-low valuation underlying the SFO Plan,
which results in the delivery of value to SFO Noteholders
far in excess of the allowed amount of their claims in
violation of the absolute priority rule;
(b) the attempt by the Debtors and the SFO Noteholders
Committee to cram down the SFO Plan over the objection of
an overwhelming majority in number and amount of SFI
creditors either by effecting a de facto substantive
consolidation or by manufacturing a consenting impaired
class at SFI by impermissibly gerrymandering and
artificially impairing the small, contingent claim of an
insider;
(c) the unfair discrimination effected by the
disproportionately high allocation of the opportunity to
participate in the rights offering that the members of the
SFO Noteholders Committee have arrogated to themselves in
their capacity as Backstop Purchasers at the expense of
other SFO creditors;
(d) the Debtors' inability to meet the "good faith"
requirements of Bankruptcy Code Section 1129(a)(3); and
(e) the SFO Plan's inclusion of impermissible third-party re
leases of officers, directors, and the SFO Noteholders
Committee.
On behalf of the Creditors' Committee, Kathleen P. Makowski,
Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington,
Delaware, asserts that as the SFO Plan's proponents, it is the
Debtors' burden to prove and persuade the Court, by a
preponderance of the evidence, that the SFO Plan satisfies every
applicable confirmation requirement under Bankruptcy Code
Sections 1129(a) and (b). If the Debtors are unable to satisfy
each required element, confirmation of the Debtors' Fourth
Amended Plan must be denied, Ms. Makowski further asserts.
In a separate filing, the Creditors' Committee asks the Court to
authorize the Debtors to file exhibits to Confirmation Objections
under seal contending that certain exhibits contain confidential
commercial information, which are subject to confidentiality
agreements between various parties in this matter.
The Committee also seeks the Court's approval to exceed the 40-
page limit with respect to its objection to the Debtors' Fourth
Amended Plan. Further, the Committee asks the Court to shorten
the period for notice of the hearing on its motions to authorize
the Debtors to file exhibits under seal and to exceed the page
limitation of its plan confirmation objection so that the Court
can convene to consider the motions on an expedited basis on
March 5, 2010, with objections, if any, to be filed prior to the
hearing.
Six Flags Plan
Six Flags Inc. and its units have filed a proposed plan and
disclosure statement.
In broad terms, the Plan, as thrice amended, envisions new debt
financing and a rights offering that will repay the existing
secured debt in full, while allowing enhanced recoveries for
senior unsecured noteholders at both the Six Flags Inc. and Six
Flags Operations Inc. levels. In this general sense, the Plan
incorporates the central features of an alternative plan put
forward by a committee of noteholders and the group has indicated
it will support the Plan.
The Plan provides for a recovery of 100.0% to holders of SFTP
Prepetition Credit Agreement Claims, a 100% recovery for the
holders of all Other Secured Claims, a 100% recovery for the
holders of Unsecured Claims against all Debtors other than SFO and
SFI, 31.2% to 47.1% to holders of SFO Unsecured Claims, 3.2% to
4.8% to holders of SFI Unsecured Claims, and no recovery for
holders of Funtime, Inc. Claims, Subordinated Securities Claims
and Preconfirmation Equity Interests in SFI.
A full-text copy of the disclosure statement to the third amended
reorganization plan is available for free at:
http://bankrupt.com/misc/SixFlags_3rdAmndd_DiscStatement.pdf
About Six Flags
Headquartered in New York City, Six Flags, Inc., is the world's
largest regional theme park company with 20 parks across the
United States, Mexico and Canada.
Six Flags filed for Chapter 11 protection on June 13, 2009 (Bankr.
D. Del. Lead Case No. 09-12019). Paul E. Harner, Esq., Steven T.
Catlett, Esq., and Christian M. Auty, Esq., at Paul, Hastings,
Janofsky & Walker LLP in Chicago, Illinois, act as the Debtors'
lead counsel. Daniel J. DeFranceschi, Esq., and L. Katherine
Good, Esq., at Richards, Layton & Finger, P.A., in Wilmington,
Delaware, act as local counsel. Cadwalader Wickersham & Taft LLP,
serves as special counsel. Houlihan Lokey Howard & Zukin Capital
Inc., serves as financial advisors, while KPMG LLC acts as
accountants. Kurtzman Carson Consultants LLC serves as claims and
notice agent. As of March 31, 2009, Six Flags had $2,907,335,000
in total assets and $3,431,647,000 in total liabilities.
Bankruptcy Creditors' Service, Inc., publishes Six Flags
Bankruptcy News. The newsletter provides gavel-to-gavel coverage
of the Chapter 11 proceedings undertaken by Six Flags Inc. and its
various affiliates. (http://bankrupt.com/newsstand/or 215/945-
7000).
SIX FLAGS: Exclusive Solicitation Period Extended Until April 5
---------------------------------------------------------------
Judge Christopher S. Sontchi of the United States Bankruptcy
Court for the District of Delaware granted Six Flags Inc.'s
request to extend their exclusive period for soliciting
acceptances of their Plan of Reorganization to April 5, 2010.
Prior to the entry of the Order, the SFO Noteholders Informal
Committee asked the Court to deny the request filed by the
Official Committee of Unsecured Creditors seeking a March 1, 2010
mediation among the Debtors, the Creditors' Committee, the SFO
Noteholders Committee and the SFI Noteholders Committee regarding
the terms of a potential consensual plan.
Counsel for the SFO Noteholders, Howard A. Cohen, Esq., at
Drinker Biddle & Reath LLP, in Wilmington, Delaware, argues that
the Creditors' Committee's request should be denied because the
parties have irreconcilable views about value that cannot be
bridged in any mediation and, thus, ordering a mediation at this
late stage of the proceedings would simply waste time and further
estate and judicial resources, as well as distract the parties
from their preparations for the upcoming confirmation hearing
scheduled to commence in only a few weeks on March 8, 2010.
The SFO Noteholders submitted with the Court witness and exhibit
lists for the confirmation hearing on March 8, 2010.
Debtors Address Responses to Extension Request
The Debtors, believing that an omnibus reply will assist the
Court in its consideration of the issues raised in the
Exclusivity Motion, sought and obtained the Court's approval for
leave to file the omnibus reply to exclusivity responses.
The Debtors, responding to the opposition of (i) Resilient
Capital Management, LLC, (ii) the Creditors' Committee, and (iii)
the SFI Noteholders, to the request for the extension of the
Exclusive Solicitation Period maintain that:
(1) The issue of the Debtors' statutorily-presumed right to
have a "first shot" at confirmation already has been
litigated and decided by the Court in the Debtors' favor --
specifically, in extending exclusivity, the Court found
that the Debtors had conducted their reorganization in good
faith.
(2) The Responses of the Creditors' Committee and the SFI
Noteholders concede as much, since both ultimately seek the
same thing sought by the Debtors -- namely, extension of
the Exclusive Period until after the currently-scheduled
confirmation hearing.
(3) Having essentially acknowledged that the relief sought by
the Debtors in the Motion is appropriate and should be
granted, the Creditors' Committee and the SFI Noteholders'
Responses devolve into an effort to pre-judge some future,
hypothetical request for future extension of the Exclusive
Periods and to launching preliminary salvos in opposition
to confirmation. Neither effort is availing.
The Debtors also complain that:
-- the Creditors' Committee and the SFI Noteholders overreach
in claiming that in granting the extension of the Exclusive
Period to conform to the current confirmation schedule the
Court should go further and terminate exclusivity if the
Debtors' current plan proposal is not confirmed;
-- the confirmation objections in the SFI Response are
premature and so will be fully addressed by the Debtors in
connection with confirmation; and
-- the Court's prior ruling extending the Exclusive Period
disposes much of the stale arguments presented in the
Resilient Response.
The SFI Noteholders asserted that the current plan "cannot
possibly satisfy the requirements of Section 1129(a)(10) of the
Bankruptcy Code that at least one class of impaired, non-insider
unsecured creditors vote to accept the Chapter 11 plan."
Although the SFI Noteholders insist on isolating one class of
impaired claims -- the Time Warner SFI guaranty claims -- the
case law, both within and outside of the Third Circuit, makes
clear that Section 1129(a)(10)'s consenting impaired class
requirement is evaluated for the plan as a whole, and
confirmation is permissible over the dissent of a voting class of
creditors, the Debtors argue.
The Debtors assert that Resilient's allegations of conflict of
interest and breach of fiduciary duties by the management
likewise are unavailing and without basis. The Debtors point out
that, other major constituencies, including the Prepetition
Lenders, SFO Noteholders, Creditors' Committee, and SFI
Noteholders, have supported the management and indicated that
current management contracts will be assumed.
The Debtors maintain that, in all events, it is clear that
continuation of the Exclusive Periods will advance these cases.
The Debtors say they have actively engaged their creditors from
the outset and remain in dialogue with all interested parties,
most notably the SFI Noteholders, in an effort to achieve a fully
consensual plan of reorganization among the materially interested
parties. To be clear, the Debtors say they are convinced that
the currently proposed Fourth Amended Plan remains the best
possible fully-financed and confirmable plan available at
present. Nevertheless, the Debtors tell the Court that they are
committed to the ongoing negotiations and, as always, are
amenable to any proposals that enhance value for their creditors
in the context of a confirmable plan.
Six Flags Plan
Six Flags Inc. and its units have filed a proposed plan and
disclosure statement.
In broad terms, the Plan, as thrice amended, envisions new debt
financing and a rights offering that will repay the existing
secured debt in full, while allowing enhanced recoveries for
senior unsecured noteholders at both the Six Flags Inc. and Six
Flags Operations Inc. levels. In this general sense, the Plan
incorporates the central features of an alternative plan put
forward by a committee of noteholders and the group has indicated
it will support the Plan.
The Plan provides for a recovery of 100.0% to holders of SFTP
Prepetition Credit Agreement Claims, a 100% recovery for the
holders of all Other Secured Claims, a 100% recovery for the
holders of Unsecured Claims against all Debtors other than SFO and
SFI, 31.2% to 47.1% to holders of SFO Unsecured Claims, 3.2% to
4.8% to holders of SFI Unsecured Claims, and no recovery for
holders of Funtime, Inc. Claims, Subordinated Securities Claims
and Preconfirmation Equity Interests in SFI.
A full-text copy of the disclosure statement to the third amended
reorganization plan is available for free at:
http://bankrupt.com/misc/SixFlags_3rdAmndd_DiscStatement.pdf
About Six Flags
Headquartered in New York City, Six Flags, Inc., is the world's
largest regional theme park company with 20 parks across the
United States, Mexico and Canada.
Six Flags filed for Chapter 11 protection on June 13, 2009 (Bankr.
D. Del. Lead Case No. 09-12019). Paul E. Harner, Esq., Steven T.
Catlett, Esq., and Christian M. Auty, Esq., at Paul, Hastings,
Janofsky & Walker LLP in Chicago, Illinois, act as the Debtors'
lead counsel. Daniel J. DeFranceschi, Esq., and L. Katherine
Good, Esq., at Richards, Layton & Finger, P.A., in Wilmington,
Delaware, act as local counsel. Cadwalader Wickersham & Taft LLP,
serves as special counsel. Houlihan Lokey Howard & Zukin Capital
Inc., serves as financial advisors, while KPMG LLC acts as
accountants. Kurtzman Carson Consultants LLC serves as claims and
notice agent. As of March 31, 2009, Six Flags had $2,907,335,000
in total assets and $3,431,647,000 in total liabilities.
Bankruptcy Creditors' Service, Inc., publishes Six Flags
Bankruptcy News. The newsletter provides gavel-to-gavel coverage
of the Chapter 11 proceedings undertaken by Six Flags Inc. and its
various affiliates. (http://bankrupt.com/newsstand/or 215/945-
7000).
SIX FLAGS: March 5 Hearing on Kentucky Park Leases Rejection
------------------------------------------------------------
Six Flags Inc. and its units seek the Bankruptcy Court' authority
to reject, effective March 5, 2010:
(1) a park lease agreement, dated February 21, 1996, with the
Commonwealth of Kentucky, the State Property and
Buildings Commission of the Commonwealth of Kentucky, the
Finance and Administration Cabinet of the Commonwealth of
Kentucky, and the Kentucky State Fair Board, for the
premises known as Six Flags Kentucky Kingdom; and
(2) an assignment and assumption agreement of the park lease,
dated October 31, 1997, between Kentucky Kingdom, Inc., and
Debtor KKI, LLC.
Further, the Debtors seek the Court's authority to abandon any
remaining personal property at the Six Flags Kentucky Kingdom
premises that may either be of de minimis value or otherwise
burdensome to the estate, in as is, where is basis.
The State Agencies and Kentucky Kingdom, Inc., entered into the
Amended and Restated Lease Agreement for the real property known
as the Kentucky Kingdom. On October 31, 1997, KK Inc., assigned
its interest as tenant in the Park Lease to KKI, LLC.
On January 8, 2010, the Court approved the stipulation between
Debtor KKI, LLC and the Park Landlords, whereby the parties
agreed to extend the deadline by which the Debtors had the right
to assume or reject the Park Lease from January 9, 2010, to
April 9.
Daniel J. DeFranceschi, Esq., at Richards, Layton & Finger, P.A.,
in Wilmington, Delaware, says that pursuant to the terms of the
Lease, KKI leased Six Flags Kentucky Kingdom theme park, the
current term of which will expire on December 31, 2019. After a
review and analysis of the terms of the Lease, KKI, no longer
believes that the Lease is in the best interest of the estate.
The revenue generated by the Debtors' operations at the leased
premises is insufficient to justify the expenses incurred under
the Lease and in the operation of SFKK, according to Mr.
DeFranceschi. The continued payments under the Lease would be
economically burdensome and would constitute an unnecessary drain
on the Debtors' assets, he adds.
According to Mr. DeFranceschi, the Debtors believe that it may be
more advantageous to the estates to abandon certain property of
de minimis value at the SFKK premises rather than incurring the
cost of its removal.
The Court will convene a hearing to consider the motion on
March 5, 2010, at 2:00 p.m., Eastern Standard Time.
About Six Flags
Headquartered in New York City, Six Flags, Inc., is the world's
largest regional theme park company with 20 parks across the
United States, Mexico and Canada.
Six Flags filed for Chapter 11 protection on June 13, 2009 (Bankr.
D. Del. Lead Case No. 09-12019). Paul E. Harner, Esq., Steven T.
Catlett, Esq., and Christian M. Auty, Esq., at Paul, Hastings,
Janofsky & Walker LLP in Chicago, Illinois, act as the Debtors'
lead counsel. Daniel J. DeFranceschi, Esq., and L. Katherine
Good, Esq., at Richards, Layton & Finger, P.A., in Wilmington,
Delaware, act as local counsel. Cadwalader Wickersham & Taft LLP,
serves as special counsel. Houlihan Lokey Howard & Zukin Capital
Inc., serves as financial advisors, while KPMG LLC acts as
accountants. Kurtzman Carson Consultants LLC serves as claims and
notice agent. As of March 31, 2009, Six Flags had $2,907,335,000
in total assets and $3,431,647,000 in total liabilities.
Bankruptcy Creditors' Service, Inc., publishes Six Flags
Bankruptcy News. The newsletter provides gavel-to-gavel coverage
of the Chapter 11 proceedings undertaken by Six Flags Inc. and its
various affiliates. (http://bankrupt.com/newsstand/or 215/945-
7000).
SIX FLAGS: SFI Noteholders Object to Plan Confirmation
------------------------------------------------------
The Ad Hoc Committee of SFI Noteholders in Six Flags Inc.'s cases
asks the Court to deny the Debtors' Fourth Amended Plan of
Reorganization contending that the Plan fails to meet the
confirmation requirements set forth in Section 1129(a) of the
Bankruptcy Code in respect of the several of the Debtors' estates,
most particularly that of Six Flags, Inc.
More specifically, the SFI Noteholders believe the Plan cannot be
confirmed because:
(i) it fails to provide for a legitimate accepting impaired
class of unsecured claims against SFI's estate as required
by Section 1129(a)(10); and
(ii) it has not been proposed in good faith as required by
Section 1129(a)(3) given breaches of their fiduciary duty
associated with pursuing the present Plan; and
(iii) fails the "best interest of creditors" test under
Section 1129(a) (7) by providing SFI creditors with less
value then they would receive in a liquidation of the SFI
Assets.
Moreover, the SFI Noteholders asserts that even if the Court were
to find that all of the required provisions of Section 1129(a)
were satisfied, the Plan still cannot be confirmed over the SFI's
creditors' "no" votes because it discriminates unfairly against
the SFI Noteholders and is not fair and equitable as to SFI
creditors under Section 1129(b)(1) of the Bankruptcy Code.
In "Final Stages" of Debt & Equity Financing
The SFI Noteholders said on February 25 that they are in the
final stages of funding an alternative restructuring strategy,
Reuters reported.
The SFI Noteholders have said that at $1.8 billion, they have
more than doubled their money offered to fund an alternative to
the existing Six Flags plan, the report related. According to
Reuters, the SFI Noteholders said their plan would pay in cash
claims asserted against Six Flags Amusement Park.
The SFI Noteholders told the Court that they are in the "final
stages of finalizing" debt and equity financing for their
reorganization plan for the Debtors, Bloomberg reported. The
Noteholders noted that Judge Sontchi has said having financing
commitments behind a plan at a higher valuation would be a "key
factor" in his decision about which plan to approve, the report
said.
Incumbent management of Six Flags evidently will lose their jobs
if the SFI Noteholders succeed in taking over the theme-park
operator by winning confirmation of their competing
reorganization plan, the report said, noting that the Noteholders
have stated that they have identified a "highly experienced,
industry leading management team" to take over once their plan is
approved and implemented. The SFI Noteholders further disclosed
that they have identified a highly experienced management team to
take over the theme park management once their plan is approved
and implemented, Bloomberg reported.
H Partners
H Partners Management LLC, on behalf of certain managed funds,
and Bay Harbour Management LLC, on behalf of certain managed
funds, each holder of both SFO Notes and SFI Notes, ask the Court
to deny the Debtors' Fourth Amended Plan.
H Partners and Bay Harbour contend that the Plan contemplates a
brazen, unjustifiable transfer of excess value to a select group
of SFO Noteholders purportedly for backstopping the rights
offering under the Debtors' Plan.
The Debtors' Plan provides that only "Accepting SFO Noteholders"
may participate in the Rights Offering and the Plan treats
accepting SFO Noteholders differently from, and discriminates
against, rejecting and non-voting SFO Noteholders in the same
class, H Partners and Bay Harbour complain.
According to Anthony M. Sacullo, Esq., at Ciardi Ciardi & Astin,
in Wilmington, Delaware, the Debtors' Plan provides that only
those SFO Noteholders who vote in favor of the Debtors' Plan may
participate in the Rights Offering. This, he complains,
discriminates against SFO Noteholders that reject or don't vote
on the Debtors' Plan, in direct contravention of Section
1123(a)(4) of the Bankruptcy Code, which exemplifies equality of
treatment. This discriminatory treatment alone makes the
Debtors' Plan facially unconfirmable, he tells the Court.
Mr. Sacullo adds that offering special treatment to individual
creditors -- in the form of the right to participate in the
Rights Offering -- for voting in favor of the Debtors' Plan is
coercive. A coercive solicitation cannot satisfy Section
1125(e)'s good faith solicitation requirement, he asserts.
Six Flags Plan
Six Flags Inc. and its units have filed a proposed plan and
disclosure statement.
In broad terms, the Plan, as thrice amended, envisions new debt
financing and a rights offering that will repay the existing
secured debt in full, while allowing enhanced recoveries for
senior unsecured noteholders at both the Six Flags Inc. and Six
Flags Operations Inc. levels. In this general sense, the Plan
incorporates the central features of an alternative plan put
forward by a committee of noteholders and the group has indicated
it will support the Plan.
The Plan provides for a recovery of 100.0% to holders of SFTP
Prepetition Credit Agreement Claims, a 100% recovery for the
holders of all Other Secured Claims, a 100% recovery for the
holders of Unsecured Claims against all Debtors other than SFO and
SFI, 31.2% to 47.1% to holders of SFO Unsecured Claims, 3.2% to
4.8% to holders of SFI Unsecured Claims, and no recovery for
holders of Funtime, Inc. Claims, Subordinated Securities Claims
and Preconfirmation Equity Interests in SFI.
A full-text copy of the disclosure statement to the third amended
reorganization plan is available for free at:
http://bankrupt.com/misc/SixFlags_3rdAmndd_DiscStatement.pdf
About Six Flags
Headquartered in New York City, Six Flags, Inc., is the world's
largest regional theme park company with 20 parks across the
United States, Mexico and Canada.
Six Flags filed for Chapter 11 protection on June 13, 2009 (Bankr.
D. Del. Lead Case No. 09-12019). Paul E. Harner, Esq., Steven T.
Catlett, Esq., and Christian M. Auty, Esq., at Paul, Hastings,
Janofsky & Walker LLP in Chicago, Illinois, act as the Debtors'
lead counsel. Daniel J. DeFranceschi, Esq., and L. Katherine
Good, Esq., at Richards, Layton & Finger, P.A., in Wilmington,
Delaware, act as local counsel. Cadwalader Wickersham & Taft LLP,
serves as special counsel. Houlihan Lokey Howard & Zukin Capital
Inc., serves as financial advisors, while KPMG LLC acts as
accountants. Kurtzman Carson Consultants LLC serves as claims and
notice agent. As of March 31, 2009, Six Flags had $2,907,335,000
in total assets and $3,431,647,000 in total liabilities.
Bankruptcy Creditors' Service, Inc., publishes Six Flags
Bankruptcy News. The newsletter provides gavel-to-gavel coverage
of the Chapter 11 proceedings undertaken by Six Flags Inc. and its
various affiliates. (http://bankrupt.com/newsstand/or 215/945-
7000).
SPANSION INC: Committee Supports Noteholders Financing Offer
------------------------------------------------------------
The Official Committee of Unsecured Creditors in Spansion Inc.'s
case filed with the Bankruptcy Court, on February 19, 2010, a
statement of position with respect to:
(i) confirmation of the Debtors' Second Amended Joint Plan of
Reorganization dated February 8, 2010;
(ii) competing rights offers; and
(iii) the Ad Hoc Committee of Convertible Noteholders'
Emergency Motion for Order (A) Vacating Order Approving
Debtors' Disclosure Statement and Adjourning Confirmation
Hearing and (B) Directing Appointment of Trustee
or Examiner.
The Creditors Committee tells the Court that it does not object
to confirmation of the Plan at this time, as it has resolved many
of its concerns, including corporate governance concerns
addressed through the selection of specific directors. The
Creditors Committee notes that neither does it support granting
the relief sought in the motion to vacate the disclosure
statement order filed by the Ad Hoc Committee of Convertible
Noteholders. Moreover, the Creditors Committee says it continues
to take no position with respect to the current intra-creditor
dispute regarding valuation of Reorganized Spansion.
According to the Creditors Committee, an issue has arisen very
recently that is tangential to confirmation of the Plan but that,
if acted upon, would improve the recoveries of general unsecured
creditors by at least $40 million. The Plan currently
contemplates a Backstop Rights Purchase Agreement sponsored by
Silver Lake Sumeru, L.P. Recently, however, the Ad Hoc Committee
has submitted its own fully-subscribed equity financing
agreement.
The Creditors Committee tells the Court that the choice of which
of the two competing rights offerings is pursued by the Debtors
has a material economic impact on holders of general unsecured
claims in Classes 5A, 5B and 5C. If the Debtors consummate the
Ad Hoc Committee Rights Offering rather than the Silver Lake
Rights Offering, general unsecured creditors will receive in
excess of $40 million in incremental value, the Creditors
Committee asserts. Which rights offering is consummated has no
bearing on confirmation of the Plan; however, it does impact the
recoveries of the Debtors' unsecured creditors, the Creditors
Committee adds.
Thus, the Creditors Committee asks the Court to direct the
Debtors to terminate the Silver Lake Rights Offering and instead
to consummate the Ad Hoc Committee Rights Offering.
Debtors Talk Back
The Debtors assert that the Creditor Committee's position is
naive, inherently risky and at odds with the requirements of the
Bankruptcy Code and fundamental principles of due process.
Instead, the Debtors believe that accepting the Ad Hoc
Committee's Proposal will delay and likely derail the current
confirmation proceedings, lead to a proliferation of litigation
and a further fracturing of creditor constituencies and benefit
no one but the professionals retained in their bankruptcy cases.
The Debtors maintain that after considering the Ad Hoc
Committee's Proposal and discussing it with their creditor
constituencies, they have determined that the benefits, if any,
to their estates and stakeholders, taken as a whole, from that
Proposal do not come close to justifying the risk to all parties
of jeopardizing the Debtors' reorganization at this late stage of
their bankruptcy cases. Moreover, the Debtors say that the plain
language of the Plan and the Disclosure Statement do not
contemplate or permit the Debtors to accept that Proposal in lieu
of the Rights Offering.
Accordingly, the Debtors tell the Court that they cannot and will
not support the Creditor Committee's proposal to abandon the
Rights Offering in favor of the Ad Hoc Proposal.
In a separate filing, the informal group of certain holders of
11.25% Senior Notes due 2016, and the informal group of holders
of trade claims separately filed joinders to the Debtors'
response.
Blackstone Report Improper, says Ad Hoc Committee
As previously reported, the Informal Group proposed to offer The
Blackstone Group expert testimony in support of the enterprise
value of Spansion during the confirmation hearing.
The Ad Hoc Committee of Convertible Noteholders consisting of
certain holders of 2.25% Exchangeable Senior Subordinated
Debentures due 2016, avers that it would be improper to permit
any representative of Blackstone to testify as an expert witness
on behalf of the Informal Group because the terms of Blackstone's
engagement to testify effectively creates a contingent fee
arrangement that necessarily taints any and all testimony or
evidence offered by Blackstone, and eliciting that testimony or
evidence from Blackstone by the Informal Group's counsel would be
ethically improper.
Although not directly styled as a traditional contingent fee
arrangement, the amorphous and undefined nature of the
arrangement by which Blackstone has agreed to testify has
effectively created a situation in which the question of whether,
when and in what form Blackstone will be paid for some or all of
its services is potentially contingent on the outcome of the
Debtors' cases, the Ad Hoc Committee asserts.
In response to objection, the Informal Group contends that
Blackstone does not and did not have a contingency fee or success
fee arrangement for its services. Indeed, the Informal Group
avers, the Ad Hoc Committee's most recent accusations wholly
ignore Michael Genereux's testimony that Blackstone's fees were
not contingent and are completely at odds with the retention
letter's plain language proving that Blackstone's fees are fixed.
Parties File Amended Exhibits
Parties-in-interest delivered to the Court amended list of
witnesses and exhibits in connection with the February 24
Confirmation Hearing:
(a) Informal Group
http://bankrupt.com/misc/Spansion_InformalGroupWintness2.pdf
http://bankrupt.com/misc/Spansion_InformalGroupList.pdf
(b) Ad Hoc Committee of Convertible Noteholders
http://bankrupt.com/misc/Spansion_ConvertComm_AmExhibt.pdf
http://bankrupt.com/misc/Spansion_DemonExhibit.pdf
(c) Debtors
http://bankrupt.com/misc/Spansion_DebtorsAmExhibits.pdf
http://bankrupt.com/misc/Spansion_AmExListDebtors.pdf
(d) Ad Hoc Committee of Equity Security Holders
http://bankrupt.com/misc/Spansion_AmExListAdHoc.pdf
The Official Committee of Unsecured Creditors reserves its rights
to (i) present any documents designated on the list of exhibits
of the Debtors or any other party, (ii) present any documents
used by any party at the hearing, and (iii) call any witness
listed by any other party.
Objection Status Charts
The Debtors delivered to the Court their 2nd, 3rd and 4th
comprehensive summary of plan objections and their corresponding
responses.
Pursuant to the Debtors' 2nd Objection Status, the Debtors tell
the Court that:
(a) the objection of International Business Machines
Corporation has not been resolved;
(b) they are attempting to resolve Spansion Japan Limited's
objections prior to the Confirmation Hearing to the extent
that they have not already been adjudicated by the Court.
A full-text copy of the 2nd Objection Status Chart is available
for free at:
http://bankrupt.com/misc/Spansion_2ndResponseChart.pdf
The third amended comprehensive summary reflects, among others,
the resolution of the objection of Longacre Opportunity Fund, LP.
A full-text copy of the 3rd Objection Status Chart filed
February 23, 2010, is available for free at:
http://bankrupt.com/misc/Spansion_3rdAmObjStatus.pdf
The Debtors relate in their 4th Objection Status Report
that:
(a) Bank of America and the Debtors have entered into
documentation to resolve Bank of America's reservation
of rights.
(b) they have agreed to make the changes to the Plan
and Confirmation Order requested by GE Japan Corporation
to resolve GE's objection.
(c) they have agreed to make the changes to the Plan
and Confirmation Order requested by Spansion Japan
Limited to resolve its objection.
(d) Tessera will not pursue its feasibility objection. However,
Tessera will continue to object to the treatment of its
alleged administrative expense claim.
A full-text copy of the 4th Objection Status Chart filed
February 28, 2010, is available for free at:
http://bankrupt.com/misc/Spansion_4thObjStatus.pdf
Debtors Seek to Exclude R. White's Testimony
The Debtors ask the Court to exclude Robert White from providing
expert testimony in support of the Ad hoc committee of
convertible noteholders' objection the Plan. The Debtors assert
that the Convertible Committee did not disclose Mr. White as an
expert witness until February 23, well past the January 27
deadline for expert identification and expert report disclosure.
About Spansion Inc.
Spansion Inc. (Pink Sheets: SPSNQ) -- http://www.spansion.com/--
is a Flash memory solutions provider. Spansion is a former joint
venture of AMD and Fujitsu.
Spansion Inc., Spansion LLC, Spansion Technology LLC, Spansion
International, Inc., and Cerium Laboratories LLC filed voluntary
petitions for Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead
Case No. 09-10690). On February 9, 2009, Spansion's Japanese
subsidiary, Spansion Japan Ltd., voluntarily entered into a
proceeding under the Corporate Reorganization Law (Kaisha Kosei
Ho) of Japan to obtain protection from its creditors as part of
the company's restructuring efforts. None of Spansion's
subsidiaries in countries other than the United States and Japan
are included in the U.S. or Japan filings.
Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and Kimberly A.
Posin, Esq., at Latham & Watkins LLP, have been tapped as
bankruptcy counsel. Michael R. Lastowski, Esq., at Duane Morris
LLP, is the Delaware counsel. Epiq Bankruptcy Solutions LLC, is
the claims agent. The United States Trustee has appointed an
official committee of unsecured creditors in the case. As of
September 30, 2008, Spansion disclosed total assets of
US$3,840,000,000, and total debts of US$2,398,000,000.
Spansion Japan Ltd. filed a Chapter 15 petition on April 30, 2009
(Bankr. D. Del. Case No. 09-11480). The Chapter 15 Petitioner's
counsel is Gregory Alan Taylor, Esq., at Ashby & Geddes. It said
that Spansion Japan had US$10 million to US$50 million in assets
and US$50 million to US$100 million in debts.
Bankruptcy Creditors' Service, Inc., publishes Spansion Bankruptcy
News. The newsletter tracks the Chapter 11 proceeding
undertaken by Spansion Inc. and its affiliates
(http://bankrupt.com/newsstand/or 215/945-7000)
SPANSION INC: Further Modifies Reorganization Plan
--------------------------------------------------
Spansion Inc. and its debtor affiliates delivered to the U.S.
Bankruptcy Court for the District of Delaware a further modified
Second Amended Joint Plan of Reorganization on February 19, 2010.
In accordance with the February 19 Amended Plan, effective as of
February 8, 2010, the Debtors will not pay any Administrative
Expense Claim in excess of $250,000 other than any Administrative
Expense Claim for professional compensation, liabilities incurred
by any of the Debtors in the ordinary course of the conduct of
their business, the fees and expenses of the ad hoc consortium of
holders of floating rate notes' professionals, the professionals
of the holders of the Secured Credit Facility Claims,
compensation or expenses to the Indenture Trustees or Indenture
Trustees' professionals, without the prior consent of the
informal group of holders of senior notes and the Official
Committee of Unsecured Creditors.
The February 19 Amended Plan provides that Eugene Davis will act
as the agent for the estates in evaluating and prosecuting (i)
objections to the disputed claims in Classes 5A, 5B, 5C and 5D,
and (ii) Avoidance Actions to recover any alleged transfers made
to any entity that received payments or transfers during the
applicable "look back" period and (iii) all actions brought
pursuant to Section 501(c) of the Bankruptcy Code.
A clean copy of the February 19 Plan is available for free at:
http://bankrupt.com/misc/Spansion_Feb19Plan.pdf
A redlined copy of the February 19 Amended Plan is available for
free at http://bankrupt.com/misc/Spansion_Feb19RedPlan.pdf
The February 19 Plan notes that the Debtors contemplate that
additional changes may be made to the Plan to reflect the Court's
ruling on the Motion of Spansion Japan Limited for an order (i)
determining the proper classification of its rejection damages
claim and (ii) requiring the Debtors to establish a reserve under
the Plan for distributions on account of its rejection damages
claim.
The Debtors are engaged in discussions with Spansion Japan
Limited and other parties-in-interest regarding these changes,
states the February 19 Plan.
February 23 Amended Plan
After receiving informal comments from certain parties-in-
interest, the Debtors filed another further modified 2nd Amended
Plan on February 23, 2010.
Among the amendments to the Plan are:
(a) The Debtors eliminated Class 5D which is Spansion Japan
Limited's Rejection Damages Claim.
(b) Effective as of February 8, 2010, the Debtors will not pay
any Administrative Expense Claim in excess of $250,000
other than, among others, the Spansion Japan
Administrative Expense Claim.
The Spansion Japan Administrative Expense Claim refers to
any Administrative Expense Claim of Spansion Japan Limited
arising or accruing after October 27, 2009, in accordance
with that certain Order Approving Settlement between
Spansion LLC and Spansion Japan dated January 29, 2010.
(c) No payment or Distribution will be made to any holder on
account of any claim until that claim becomes an allowed
claim.
(d) The Distributions on account of Disputed Claims will be
made to the reserve for Disputed Claims and any Disputed
Claim will be treated as being Allowed in the lesser of
(i) the face amount of those Disputed Claims or (ii) any
other amount for purposes of the Reserve for Disputed
Claims established by the Bankruptcy Court for those
Disputed Claims.
A redlined copy of the February 23 Plan is available for free at:
http://bankrupt.com/misc/Spansion_RedlinedPlanFeb23.pdf
Modified Confirmation Order
Subsequently, the Debtors delivered to the Court a modified
proposed confirmation order, a full-text copy of which is
available for free at:
http://bankrupt.com/misc/Spansion_Feb23ConOrd.pdf
The Modified Proposed Confirmation Order reflects, among other
things, that:
(a) Spansion LLC is authorized to consummate and close on the
Spansion Japan Definitive Agreements, and the Spansion
Japan Settlement Order. Both the Agreement and the Order
will remain valid and enforceable in all respects, and the
obligations in connection with both will not be
discharged, released or impaired. In the event of
controversy or inconsistency, the terms of the Spansion
Japan Settlement Order or Spansion Japan Definitive
Agreements will control.
(b) Nothing contained in the Confirmation Order will preclude
Spansion Japan Limited from filing, on or before
March 12, 2010, an amendment to its Claim No. 1165 for
rejection damages arising from the Debtors' rejection of
that the Second Amended and Restated Foundry Agreement
dated March 30, 2007, in a liquidated maximum amount for
all rejection damages asserted in that Claim No. 1165.
The Debtors, the Reorganized Debtors and the Claims Agent
reserve all rights to contest and defend such amendment,
including on the grounds that the amendment is
impermissible or untimely.
(c) Claim Nos. 6, 56,141, 166, 209, 226, 735, 776, 1123, and
1150 must be filed and served on Longacre Opportunity Fund
or the then record Holders of those claims no later than
120 days after the date the Confirmation Order is entered.
If an objection to any Longacre Claim has not been filed
by the Longacre Deadline, each Claim will be treated
as an Allowed Claim.
Debtors File 3rd & 4th Addendum to Plan Supplements
The Debtors delivered to the Court, on February 22, 2010, a third
addendum to their Plan Supplement filed in support of their
Second Amended Joint Plan of Reorganization dated February 19,
2010. The Addendum contains:
A. Proposed Members of Initial Board
http://bankrupt.com/misc/Spansion_3rdAddendumA.pdf
B. Proposed Confirmation Order
http://bankrupt.com/misc/Spansion_ProConfirmationOrd.pdf
http://bankrupt.com/misc/Spansion_RedConfirm.pdf
C. Loan and Security Agreement
http://bankrupt.com/misc/Spansion_3rdAddendumLoanAgmt.pdf
About Spansion Inc.
Spansion Inc. (Pink Sheets: SPSNQ) -- http://www.spansion.com/--
is a Flash memory solutions provider. Spansion is a former joint
venture of AMD and Fujitsu.
Spansion Inc., Spansion LLC, Spansion Technology LLC, Spansion
International, Inc., and Cerium Laboratories LLC filed voluntary
petitions for Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead
Case No. 09-10690). On February 9, 2009, Spansion's Japanese
subsidiary, Spansion Japan Ltd., voluntarily entered into a
proceeding under the Corporate Reorganization Law (Kaisha Kosei
Ho) of Japan to obtain protection from its creditors as part of
the company's restructuring efforts. None of Spansion's
subsidiaries in countries other than the United States and Japan
are included in the U.S. or Japan filings.
Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and Kimberly A.
Posin, Esq., at Latham & Watkins LLP, have been tapped as
bankruptcy counsel. Michael R. Lastowski, Esq., at Duane Morris
LLP, is the Delaware counsel. Epiq Bankruptcy Solutions LLC, is
the claims agent. The United States Trustee has appointed an
official committee of unsecured creditors in the case. As of
September 30, 2008, Spansion disclosed total assets of
US$3,840,000,000, and total debts of US$2,398,000,000.
Spansion Japan Ltd. filed a Chapter 15 petition on April 30, 2009
(Bankr. D. Del. Case No. 09-11480). The Chapter 15 Petitioner's
counsel is Gregory Alan Taylor, Esq., at Ashby & Geddes. It said
that Spansion Japan had US$10 million to US$50 million in assets
and US$50 million to US$100 million in debts.
Bankruptcy Creditors' Service, Inc., publishes Spansion Bankruptcy
News. The newsletter tracks the Chapter 11 proceeding
undertaken by Spansion Inc. and its affiliates
(http://bankrupt.com/newsstand/or 215/945-7000)
SPANSION INC: Has Deal With Bank of America on Claims Treatment
---------------------------------------------------------------
Spansion Inc. and Bank of America, N.A., delivered to the Court a
stipulation for the treatment of Class 1 Claims in aid of
confirmation of the Second Amended Joint Plan of Reorganization.
On September 19, 2005, Spansion LLC, certain financial
institutions and Bank of America, as administrative agent for the
Lenders, entered into that certain Credit Agreement whereby the
Lenders agreed to provide financial accommodations including a
revolving line of credit for loans and letters of credit. In
order to secure Spansion's obligations to Bank of America and the
Lenders under the Credit Agreement, Spansion and the Lenders
entered into that certain Security Agreement, pursuant to which
Spansion granted to Bank of America for the benefit of the
Lenders a security interest in virtually all of Spansion's assets
including:
(a) a first in priority lien in its cash and accounts
receivable;
(b) 100% of the capital stock or membership interests in
Spansion's domestic wholly-owned subsidiaries;
(c) up to 65% of the capital stock membership interest of
Spansion's foreign wholly-owned subsidiaries; and
(d) a second in priority lien in Spansion's inventory.
As of the record date for voting on the Plan, the Lenders
asserted a claim against the Debtors totaling $12,249,451
comprised of:
(1) Reimbursement for outstanding stand-by letters of credit
amounting to $1,541,400;
(2) Outstanding amounts under credit cards issued to or for
the benefit of the Debtors for $150,000;
(3) Reimbursement for any indemnification obligations to Banc
of America Leasing Capital LLC on account of the equipment
leases between BALC and the Debtors in the stipulated loss
value of $10,016,133;
(4) Financial accommodations made to Spansion (Thailand)
Limited for $541,918; and
(5) Interest, fees, expenses, reimbursements,
indemnifications, and other obligations as may be due by
the Debtors to Bank of America and the Lenders.
In addition to their other collateral, Bank of America and its
affiliates hold:
* approximately $2,600,000 to secure all of the obligations;
* $300,000 to secure the Credit Card Obligation; and
* approximately $541,918 to secure the "Thailand Obligation."
Bank of America and the Debtors are currently negotiating the
terms of a revolving credit facility pursuant to which Bank of
America would provide to the Debtors financial accommodations
including a revolving line of credit for loans and letters of
credit commencing upon the effective date of the Plan.
Accordingly, the Debtors and Bank of America stipulate that:
(a) the Letter of Credit Obligation will be included as part
of the Debtors' obligations under the Exit Revolver
Facility;
(b) the Credit Card Obligation will be included as part of the
Debtors' obligations under the Exit Revolver Facility;
(c) the Thailand Obligations will be included as part of the
Debtors' obligations under the Exit Revolver Facility;
(d) the Other Obligations will, at Bank of America's sole
discretion, be satisfied from the Primary Cash Collateral
or will be included as part of the Debtors' obligations
under the Exit Revolver Facility.
The parties agree to release each other from all claims, demands
and causes of action directly or indirectly related to the Credit
Agreement, the Security Agreement, the Guarantees, and Preference
Claims, whether or not those claims, demands and causes of action
are known or suspected to exist, including without limitation the
Preference Claims.
About Spansion Inc.
Spansion Inc. (Pink Sheets: SPSNQ) -- http://www.spansion.com/--
is a Flash memory solutions provider. Spansion is a former joint
venture of AMD and Fujitsu.
Spansion Inc., Spansion LLC, Spansion Technology LLC, Spansion
International, Inc., and Cerium Laboratories LLC filed voluntary
petitions for Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead
Case No. 09-10690). On February 9, 2009, Spansion's Japanese
subsidiary, Spansion Japan Ltd., voluntarily entered into a
proceeding under the Corporate Reorganization Law (Kaisha Kosei
Ho) of Japan to obtain protection from its creditors as part of
the company's restructuring efforts. None of Spansion's
subsidiaries in countries other than the United States and Japan
are included in the U.S. or Japan filings.
Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and Kimberly A.
Posin, Esq., at Latham & Watkins LLP, have been tapped as
bankruptcy counsel. Michael R. Lastowski, Esq., at Duane Morris
LLP, is the Delaware counsel. Epiq Bankruptcy Solutions LLC, is
the claims agent. The United States Trustee has appointed an
official committee of unsecured creditors in the case. As of
September 30, 2008, Spansion disclosed total assets of
US$3,840,000,000, and total debts of US$2,398,000,000.
Spansion Japan Ltd. filed a Chapter 15 petition on April 30, 2009
(Bankr. D. Del. Case No. 09-11480). The Chapter 15 Petitioner's
counsel is Gregory Alan Taylor, Esq., at Ashby & Geddes. It said
that Spansion Japan had US$10 million to US$50 million in assets
and US$50 million to US$100 million in debts.
Bankruptcy Creditors' Service, Inc., publishes Spansion Bankruptcy
News. The newsletter tracks the Chapter 11 proceeding
undertaken by Spansion Inc. and its affiliates
(http://bankrupt.com/newsstand/or 215/945-7000)
SPANSION INC: Noteholders Want Examiner or Trustee
--------------------------------------------------
The Ad Hoc Committee of Convertible Noteholders, consisting of
certain 2.25% Exchangeable Senior Subordinated Debentures due
2016 issued by Spansion LLC, tells the Court that recent
communications to the Debtors' Board of Directors and the Senior
Noteholder Group and a self-styled "Trade Claims Group" relating
to the proposed Silver Lake Rights Offering highlight the need
for the immediate appointment of an examiner or trustee pursuant
to Section 1104 of the Bankruptcy Code.
Citigroup Financial Products, Inc., and Fortress Investment Group
comprise the Trade Claims Group.
According to Mark E. Felger, Esq., at Cozen O'Connor, in
Wilmington, Delaware, counsel to the Ad Hoc Committee, the
problem is exemplified by the treatment of the largely disputed
ChipMos Technologies claim, which is now owned by the leaders of
the so-called "Trade Group Claims" that opposes the Ad Hoc
Committee's Rights Offering. Mr. Felger asserts that the
proposed Silver Lake Rights Offering, by its terms, was to be
available for subscription only by holders of allowed claims, not
disputed claims. Mr. Felger relates that, upon his information
and belief, the single largest subscriber to the Silver Lake
Rights Offering is the holder of the largely disputed ChipMos
Claim amounting to $305 million.
As previously reported, the members of the Ad Hoc Committee made
an equity financing proposal to the Debtors for $112,375,000.
About Spansion Inc.
Spansion Inc. (Pink Sheets: SPSNQ) -- http://www.spansion.com/--
is a Flash memory solutions provider. Spansion is a former joint
venture of AMD and Fujitsu.
Spansion Inc., Spansion LLC, Spansion Technology LLC, Spansion
International, Inc., and Cerium Laboratories LLC filed voluntary
petitions for Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead
Case No. 09-10690). On February 9, 2009, Spansion's Japanese
subsidiary, Spansion Japan Ltd., voluntarily entered into a
proceeding under the Corporate Reorganization Law (Kaisha Kosei
Ho) of Japan to obtain protection from its creditors as part of
the company's restructuring efforts. None of Spansion's
subsidiaries in countries other than the United States and Japan
are included in the U.S. or Japan filings.
Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and Kimberly A.
Posin, Esq., at Latham & Watkins LLP, have been tapped as
bankruptcy counsel. Michael R. Lastowski, Esq., at Duane Morris
LLP, is the Delaware counsel. Epiq Bankruptcy Solutions LLC, is
the claims agent. The United States Trustee has appointed an
official committee of unsecured creditors in the case. As of
September 30, 2008, Spansion disclosed total assets of
US$3,840,000,000, and total debts of US$2,398,000,000.
Spansion Japan Ltd. filed a Chapter 15 petition on April 30, 2009
(Bankr. D. Del. Case No. 09-11480). The Chapter 15 Petitioner's
counsel is Gregory Alan Taylor, Esq., at Ashby & Geddes. It said
that Spansion Japan had US$10 million to US$50 million in assets
and US$50 million to US$100 million in debts.
Bankruptcy Creditors' Service, Inc., publishes Spansion Bankruptcy
News. The newsletter tracks the Chapter 11 proceeding
undertaken by Spansion Inc. and its affiliates
(http://bankrupt.com/newsstand/or 215/945-7000)
SPANSION INC: Elpida Acquires NAND Flash Memory Assets
------------------------------------------------------
Bloomberg News reports that Elpida Memory Inc. has acquired
Spansion Inc.'s NAND flash memory assets.
Elpida spokesman Hiroshi Tsuboi said the purchase includes the
U.S. chipmakers's research and development facility in Milan,
Italy, Bloomberg News relates.
According to Bloomberg, the Nikkei newspaper has reported that
Elpida may pay about JPY3 billion to JPY5 billion. But Mr. Tsuboi
said the acquisition was "much less" than the reported figure,
Bloomberg notes.
About Elpida Memory
Elpida Memory Inc. (TYO:6665) -- http://www.elpida.com/ja/-- is a
Japan-based company principally engaged in the development,
design, manufacture and sale of semiconductor products, with a
focus on dynamic random access memory (DRAM) silicon chips. The
main products are DDR3 SDRAM, DDR2 SDRAM, DDR SDRAM, SDRAM, Mobile
RAM and XDR DRAM, among others. The Company distributes its
products to both domestic and overseas markets, including the
United States, Europe, Singapore, Taiwan, Hong Kong and others.
The company has eight subsidiaries and two associated companies.
* * *
Elpida Memory Inc. posted net losses of JPY23.54 billion and
JPY178.87 billion for the years ended March 31, 2008, and 2009,
respectively.
About Spansion Inc.
Spansion Inc. (Pink Sheets: SPSNQ) -- http://www.spansion.com/--
is a Flash memory solutions provider. Spansion is a former joint
venture of AMD and Fujitsu.
Spansion Inc., Spansion LLC, Spansion Technology LLC, Spansion
International, Inc., and Cerium Laboratories LLC filed voluntary
petitions for Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead
Case No. 09-10690). On February 9, 2009, Spansion's Japanese
subsidiary, Spansion Japan Ltd., voluntarily entered into a
proceeding under the Corporate Reorganization Law (Kaisha Kosei
Ho) of Japan to obtain protection from its creditors as part of
the company's restructuring efforts. None of Spansion's
subsidiaries in countries other than the United States and Japan
are included in the U.S. or Japan filings.
Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and Kimberly A.
Posin, Esq., at Latham & Watkins LLP, have been tapped as
bankruptcy counsel. Michael R. Lastowski, Esq., at Duane Morris
LLP, is the Delaware counsel. Epiq Bankruptcy Solutions LLC, is
the claims agent. The United States Trustee has appointed an
official committee of unsecured creditors in the case. As of
September 30, 2008, Spansion disclosed total assets of
US$3,840,000,000, and total debts of US$2,398,000,000.
Spansion Japan Ltd. filed a Chapter 15 petition on April 30, 2009
(Bankr. D. Del. Case No. 09-11480). The Chapter 15 Petitioner's
counsel is Gregory Alan Taylor, Esq., at Ashby & Geddes. It said
that Spansion Japan had US$10 million to US$50 million in assets
and US$50 million to US$100 million in debts.
Bankruptcy Creditors' Service, Inc., publishes Spansion Bankruptcy
News. The newsletter tracks the Chapter 11 proceeding
undertaken by Spansion Inc. and its affiliates
(http://bankrupt.com/newsstand/or 215/945-7000)
STATION CASINOS: Extends Deal With PropCo Until May 12
------------------------------------------------------
Station Casinos Inc. previously obtained approval from the
Bankruptcy Court of an interim three-month settlement with FCP
PropCo LLC in connection with leases for four hotel casinos.
Station Casinos leases the casinos from debtor-affiliate Propco;
and the leased hotels are in turn operated by SCI and non-debtor
operating units. The issue of the master lease has been a point
of contention among major stakeholders. Lenders to the operating
companies contend the leases are in reality disguised financing
arrangements while lenders to PropCo contend they are bona fide
leases. The PropCo's mortgage lenders assert that the contractual
relationship between the parties was structured as a lessor/lessee
because SCI would be forced to decide either to pay the scheduled
rent or reject the lease in its entirety. Lenders to SCI said it
won't approve a cash collateral budget that provided for the
payment of rent under the master lease beginning in December 2009.
Station Casinos, Inc. and FCP PropCo LLC now ask Judge Gregg W.
Zive of the U.S. Bankruptcy Court for the District of Nevada to
(i) approve a First Amendment to Amended and Restated Master Lease
Compromise Agreement between SCI and PropCo and (ii) authorize SCI
and PropCo to abide by the terms of the Compromise Agreement as
amended by the Compromise Amendment and perform their respective
obligations thereunder.
A full-text copy of the Compromise Amendment is available for free
at http://bankrupt.com/misc/SCI_CompromiseAmendment.pdf
The parties entered into the Compromise Amendment to amend in
certain respects the Compromise Agreement approved by the Court on
December 11, 2009, pursuant to the Compromise Agreement Order.
Oscar Garza, Esq., at Gibson, Dunn & Crutcher LLP, in Los Angeles,
California, relates that since December 11, 2009, extensive,
inclusive and virtually continuous negotiations over the terms of
a plan of reorganization for the Debtors have taken place.
Substantial and tangible progress has been made in those
discussions, including exchange of detailed term sheets and the
commencement of drafting of plan documentation, Mr. Garza says.
Indeed, Mr. Garza adds, the best evidence of the progress that has
been achieved to date is the uniform agreement of all major
stakeholders, including the Debtors, the Official Committee of
Unsecured Creditors, the Mortgage Lenders and the Required Lenders
to allow the Compromise Agreement to remain in effect for an
additional two month period to permit the parties to continue to
advance the plan process.
As was the case in the original Compromise Agreement, because of
the competing interests of the SCI and PropCo estates,
responsibility for the independence for the representation of
PropCo's interests in connection with the Compromise Amendment was
assumed by the two independent members of PropCo's board, Messrs.
Robert White and Robert Kors, who were advised by PropCo's
separate counsel, Gibson, Dunn & Crutcher LLP.
The Compromise Amendment modifies the Compromise Agreement in this
manner:
(a) The Deferral Period during which SCI may pay Reduced Rent
is extended by two months, from March 12, 2010, to and
through May 12, 2010;
(b) The amount of Restaurant Excess Cap Ex for March 2010 and
April 2010 is $2,200,000 to account for the incurrence of
an additional two months of budgeted construction expense;
(c) An additional two month cap ex true up is provided to
account for the additional two months of cap ex that will
be included in the computation of Reduced Rent; and
(d) The deadline by which SCI must assume or reject the Master
Lease is extended from March 12, 2010, up to and including
May 12, 2010, to accommodate the additional Deferral
Period.
Mr. Garza avers that the the modification of the Compromise
Agreement to provide an additional two-month period for cash
payment of Reduced Rent under the Master Lease on the existing
terms and conditions represents a reasonable exercise of business
judgment.
Robert Kors, independent director of FCP PropCo LLC, and Richard
J. Haskins, executive vice president, general counsel, and
secretary of Station Casinos, Inc., filed separate declarations in
support of the Motion.
The Debtors also sought and obtained from the Court an order
hearing the Motion on March 2, 2010, at 2:00 p.m. Objections to
the Motion are due on March 1, 2010, at 4:00 p.m.
Parties Stipulate
In support of the Motion, SCI and PropCo also submitted to the
Court a fully executed stipulation approving the Compromise
Amendment pursuant to which: (a) German American Capital
Corporation and JPMorgan Chase Bank, N.A., in their capacity as
lenders to PropCo under the Mortgage Loan Agreement; (b) Deutsche
Bank Trust Company Americas, as administrative agent for the
Lenders party to the SCI Credit Agreement; and (c) the Official
Committee of Unsecured Creditors, acting by and through its
counsel Fried, Frank, Harris, Shriver & Jacobson LLP, have
confirmed that they have no objection to the Compromise Amendment
and entry of an order approving the Compromise Amendment.
The Debtors also filed with the Court an erratum attaching the
signature page of David J. Crescenzi and Mark B. Cohen of Deutsche
Bank Trust Company Americas in the Stipulation. The Debtors were
granted permission to file the stipulation with out the Messrs.
Crescenzi and Cohen's executed signature.
Creditors' Committee's Statement
The Creditors' Committee stated that it does not object to the
entry of an order granting the request sought in the Motion.
However, the Committee told the Court that it is deeply concerned
that the Debtors' overly broad characterizations of the plan of
reorganization negotiations and other statements are misleading to
the Court and the general public regarding the involvement of the
Committee in negotiations and the scope of the Amendment.
Accordingly, the Committee filed a statement with the Court to
make certain clarifications.
The Committee related that as of March 1, 2010, it (i) has not
been a party to the plan of reorganization negotiations referenced
in the Motion, (ii) has not received any of the referenced term
sheets, (iii) has not received the drafts of the plan
documentation, and (iv) does not know any more about the terms of
the "substantial and tangible progress" that has been made other
than what was disclosed in the Debtors' Securities and Exchange
Commission Schedule 8-K filing dated February 25, 2010.
The Committee revealed that it has been excluded from the
negotiations by and among the Debtors, the Mortgage Lenders, the
Prepetition Agent and the steering committee of Prepetition
Lenders concerning a plan of reorganization since December 11,
2009.
The Committee said it has not seen any of the "detailed term
sheets" or "plan documentation" referred to by the Debtors,
notwithstanding the Committee's requests to the Debtors to review
and respond to the documents.
After repeated requests by the Committee, the business principals
of the Debtors have agreed to meet with the Committee on March 5,
2010. As of March 1, the Committee said it is still in the dark
about the agreements that are alleged to have been reached.
The Committee noted that the failure of the Debtors to allow the
Committee to play a constructive role in plan negotiations is
inconsistent with the Court's directive that the Committee be "a
meaningful participant" in plan negotiations.
About Station Casinos
Station Casinos, Inc., is a gaming and entertainment company that
currently owns and operates nine major hotel/casino properties
(one of which is 50% owned) and eight smaller casino properties
(three of which are 50% owned), in the Las Vegas metropolitan
area, as well as manages a casino for a Native American tribe.
Station Casinos Inc., together with its affiliates, filed for
Chapter 11 on July 28, 2009 (Bankr. D. Nev. Case No. 09-52477).
Station Casinos has hired Milbank, Tweed, Hadley & McCloy LLP as
legal counsel in the Chapter 11 case; Brownstein Hyatt Farber
Schreck, LLP, as regulatory counsel; and Lewis and Roca LLP as
local counsel. The Debtor is also hiring Lazard Freres & Co. LLC
as investment banker and financial advisor. Kurtzman Carson
Consultants LLC is the claims and noticing agent.
In its bankruptcy petition, Station Casinos said that it had
assets of $5,725,001,325 against debts of $6,482,637,653 as of
June 30, 2009. About 4,378,929,997 of its liabilities constitute
unsecured or subordinated debt securities.
Bankruptcy Creditors' Service, Inc., publishes Station Casinos
Bankruptcy News. The newsletter tracks the Chapter 11 proceedings
of Station Casinos Inc. and its debtor-affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
STATION CASINOS: GCR Gaming Wants GV Ranch Case Dismissed
---------------------------------------------------------
GCR Gaming LLC asked the U.S. Bankruptcy Court for the District of
Nevada to dismiss the Chapter 11 case of GV Ranch Station Inc. as
a bad faith filing.
GCR Gaming's counsel, Marc E. Kasowitz, Esq., at Kasowitz, Benson,
Torres, & Friedman LLP, in New York, alleges that executives of
Station Casinos, Inc., which is 50% owner of Green Valley Ranch,
breached their fiduciary duties, in part, by directing high-stake
gambles at Green Valley to other casinos that Station Casinos owed
solely.
According to Mr. Kasowitz, in late December 2009, GCR first
learned of a long-running scheme implemented by SCI to
systematically divert customers, business opportunities, and other
assets from Green Valley Ranch. GCR Gaming also alleges that GV
Ranch Station sabotaged Green Valley Ranch's marketing efforts in
order to undercut its ability to compete effectively with the SCI-
Owned Casinos. Mr. Kasowitz added that the scheme included, but
was not limited to, GV Ranch Station's specific, individualized
efforts to lure Green Valley Ranch's "high rollers" 23 to Red
Rock, a competing, 100% Owned Casino; ordering Green Valley Ranch
to terminate a highly successful marketing program; all the way
down to instructing the food purveyor to deliver the "prime" cuts
of meat to Red Rock, while sending Green Valley Ranch the
"garbage."
The Las Vegas Review-Journal said Station Casinos was "extremely
disappointed the Greenspun family, which owns GCR Gaming, has
joined the fray of out-of-the-money constituents seeking to bring
meritless lawsuits in connection with our bankruptcy proceedings."
In a statement, Station Casinos said the "threatened lawsuit is
nothing more than a desperate attempt and improper attempt by the
Greenspuns to gain leverage against Station in our ongoing
restructuring discussions with Green Valley Ranch's creditors. We
intend to vigorously contest the Greenspuns' baseless claims," the
report adds.
Marc Kasowitz, GCR Gaming's New York City-based attorney, said
Station Casinos' actions left the Greenspuns with no choice but to
file the lawsuit, the report adds.
In its Motion, GCR Gaming also asked the Court to remove the
Station Casinos affiliate from the joint-venture partnership and
allow the Greenspun affiliate to sue Station Casinos outside of
bankruptcy court. GCR Gaming contended that its partner
"improperly attempted to forestall the consequences of its
wrongdoing through the bad-faith filing of its Chapter 11
petition."
About Station Casinos
Station Casinos, Inc., is a gaming and entertainment company that
currently owns and operates nine major hotel/casino properties
(one of which is 50% owned) and eight smaller casino properties
(three of which are 50% owned), in the Las Vegas metropolitan
area, as well as manages a casino for a Native American tribe.
Station Casinos Inc., together with its affiliates, filed for
Chapter 11 on July 28, 2009 (Bankr. D. Nev. Case No. 09-52477).
Station Casinos has hired Milbank, Tweed, Hadley & McCloy LLP as
legal counsel in the Chapter 11 case; Brownstein Hyatt Farber
Schreck, LLP, as regulatory counsel; and Lewis and Roca LLP as
local counsel. The Debtor is also hiring Lazard Freres & Co. LLC
as investment banker and financial advisor. Kurtzman Carson
Consultants LLC is the claims and noticing agent.
In its bankruptcy petition, Station Casinos said that it had
assets of $5,725,001,325 against debts of $6,482,637,653 as of
June 30, 2009. About 4,378,929,997 of its liabilities constitute
unsecured or subordinated debt securities.
Bankruptcy Creditors' Service, Inc., publishes Station Casinos
Bankruptcy News. The newsletter tracks the Chapter 11 proceedings
of Station Casinos Inc. and its debtor-affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
STATION CASINOS: Reaches Deal With Lenders, To File Reorg. Plan
---------------------------------------------------------------
Station Casinos, Inc., said on February 24 that it has reached an
agreement in principle for the comprehensive reorganization of the
Company with certain of its key mortgage lenders holding the debt
secured by Red Rock Casino Resort Spa, Palace Station Hotel &
Casino, Boulder Station Hotel & Casino, and Sunset Station Hotel &
Casino. The Company said it is also making significant progress
on its restructuring discussions with other creditor groups. The
Company filed its chapter 11 reorganization cases last July 2009
and has been in negotiations with lenders and other constituents
for almost a year and a half. The Company anticipates filing a
plan of reorganization this March and achieving confirmation of
that plan during the summer.
As part of the proposed reorganization, the Company expects to
significantly reduce its secured and unsecured debt and also would
have substantial liquidity in the form of new revolving credit
facilities and certain equity infusions. Following the
consummation of the reorganization, the management of the Company
would continue to be led by Frank Fertitta and members of the
current management team. In addition, Frank and Lorenzo Fertitta
would make a significant reinvestment in the equity of the
reorganized Company along side certain other current creditors and
investors in the Company. Assuming definitive documentation is
agreed to by all parties, the Company expects formal announcement
of the proposed reorganization transactions, including a
description of the material terms and conditions thereof, to be
forthcoming in the next three weeks.
The Company clarified that the press release is not intended to
be, and should not in any way be construed as, a solicitation of
votes on the Company's reorganization plan which has not yet been
filed with the U.S. Bankruptcy Court. The plan will be filed
together with a proposed disclosure statement, which should not be
relied on for any purpose until a determination by the U.S.
Bankruptcy Court is made that the proposed disclosure statement
contains adequate information, as required by the U.S. Bankruptcy
Code. Following Bankruptcy Court approval of the disclosure
statement and related voting solicitation procedures, the Company
will solicit acceptances of the plan and seek its confirmation by
the Bankruptcy Court. There can be no assurance that the plan
acceptances or confirmation will be obtained.
About Station Casinos
Station Casinos, Inc., is a gaming and entertainment company that
currently owns and operates nine major hotel/casino properties
(one of which is 50% owned) and eight smaller casino properties
(three of which are 50% owned), in the Las Vegas metropolitan
area, as well as manages a casino for a Native American tribe.
Station Casinos Inc., together with its affiliates, filed for
Chapter 11 on July 28, 2009 (Bankr. D. Nev. Case No. 09-52477).
Station Casinos has hired Milbank, Tweed, Hadley & McCloy LLP as
legal counsel in the Chapter 11 case; Brownstein Hyatt Farber
Schreck, LLP, as regulatory counsel; and Lewis and Roca LLP as
local counsel. The Debtor is also hiring Lazard Freres & Co. LLC
as investment banker and financial advisor. Kurtzman Carson
Consultants LLC is the claims and noticing agent.
In its bankruptcy petition, Station Casinos said that it had
assets of $5,725,001,325 against debts of $6,482,637,653 as of
June 30, 2009. About 4,378,929,997 of its liabilities constitute
unsecured or subordinated debt securities.
Bankruptcy Creditors' Service, Inc., publishes Station Casinos
Bankruptcy News. The newsletter tracks the Chapter 11 proceedings
of Station Casinos Inc. and its debtor-affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TEKOIL & GAS: Court Sets Plan Confirmation Hearing on March 23
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas
approved the disclosure statement explaining Tekoil & Gas
Corporation and Tekoil & Gas Gulf Coast, LLC's third amended Plan
of Reorganization. The Bankruptcy Court approval of the Debtors'
disclosure statement allows the Debtors to commence the
solicitation of votes for confirmation of their Plan.
The deadline for returning completed ballots is on March 12, 2010,
at 5:00 p.m. Central Time. Objections, if any, to confirmation of
the Plan must be received by the Court and notice parties no later
than March 12, 2010, at 5:00 p.m. Central Time. A hearing to
consider confirmation of the Plan is scheduled for March 23, 2010,
at 2:15 p.m., in Courtroom 401, 515 Rusk, Houston, Texas.
A full-text copy of the Disclosure Statement is available for free
at http://bankrupt.com/misc/TEkoil&Gas_DS.pdf
Based in Houston, Tekoil & Gas Corporation and its subsidiaries
-- http://www.tekoil.com/-- own interests in four oil and gas
properties, including the Trinity Bay, Redfish Reef, Fishers Reef,
and North Point Bolivar fields located in Galveston Bay, Texas.
The company was incorporated in Florida in 2004. Edward L.
Rothberg, Esq., at Weycer Kaplan Pulaski & Zuber, Nancy Lee
Ribaudo, Esq., and Patrick J. Neligan, Jr., Esq., at Neligan Foley
LLP, represent the Debtors as counsel. David Ronald Jones, Esq.,
John F. Higgins, Esq., and Joshua Nielson Eppich, Esq., at Porter
& Hedges, LLP, represent the Official Committee of Unsecured
Creditors of Tekoil & Gas Corp. as counsel. When Tekoil & Gas
Corp. filed for protection from its creditors, it listed assets of
$10 million to $50 million, and liabilities of $10 million to
$50 million.
Based in Spring, Texas, Tekoil and Gas Gulf Coast, LLC is an
acquisition subsidiary of Tekoil & Gas Corp. Tekoil & Gas
Corporation filed for Chapter 11 protection on June 10, 2008
(Bankr. S.D. Tex. Case No. 08-80270). Tekoil and Gas Gulf Coast
filed a separate petition for Chapter 11 relief on Aug. 29, 2008
(Bankr. S.D. Tex. Case No. 08-80405). Nancy Lee Ribaudo, Esq.,
and Patrick J. Neligan, Jr. at Neligan Foley LLP, represent Tekoil
and Gas Gulf Coast as counsel.
On October 1, 2008, the Court ordered the joint administration of
the Debtors' bankruptcy cases.
TORTILLA INC: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Tortilla, Inc.
dba Garduno's of Mexico
4604 Columbine NE
Albuquerque, NM 87113
Bankruptcy Case No.: 10-10966
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
New Mexico (Albuquerque)
Judge: James S. Starzynski
Debtor's Counsel: Daniel J. Behles, Esq.
Cuddy & McCarthy, LLP
7770 Jefferson NE, Suite 305
Albuquerque, NM 87109
Tel: (505) 888-1335
Fax: (505) 888-1369
Email: dan@behles.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including a list of its
20 largest unsecured creditors, is available for free at:
http://bankrupt.com/misc/nmb10-10966.pdf
The petition was signed by David J. Garduno, president the
Company.
TP INC: Case Summary & 3 Largest Unsecured Creditors
----------------------------------------------------
Debtor: TP, Inc.
ATTN: Ronald S. Bryant, President
P.O. Box 2180
Boone, NC 28607
Bankruptcy Case No.: 10-01594
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Eastern District of North Carolina (Wilson)
Judge: Stephani W. Humrickhouse
Debtor's Counsel: David J. Haidt, Esq.
Ayers, Haidt & Trabucco, P.A.
PO Box 1544
New Bern, NC 28563
Tel: (252) 638-2955
Fax: (252) 638-3293
Email: davidhaidt@embarqmail.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The petition was signed by Ronald S. Bryant, the company's
president.
Debtors' List of 3 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Bank of America $1,000
Attn: Managing Agent
Marshall F. Dotson, Jr., $3,615
Esquire
Bank of America $8,800
Attn: Managing Agent
TRIBUNE CO: Seeks Dismissal of New River Chapter 11 Case
--------------------------------------------------------
Tribune Co. and its units ask the Court to dismiss the Chapter 11
case of co-debtor New River Center Maintenance Association, Inc.,
nunc pro tunc to the Petition Date. The Debtors also seek the
Court's directive for the use of an amended caption in their
cases.
New River is a common maintenance association for a mixed use
commercial and residential development in Ft. Lauderdale, Florida,
in which the various property owners are the members. One member
is Riverwalk Center I JV, a partnership wholly owned by Debtors
Sun-Sentinel Company and Tribune Company, whose sole asset is a
parking lot in New River Center used by Sun-Sentinel Company.
The Debtors tell the Court that they recently received
communications from counsel to New River, who questioned New
River's status as a Chapter 11 debtor and asked that the filing be
dismissed. According to the Debtors, those communications
prompted them to review their records and undertake extensive
factual diligence. As a result, the Debtors have determined that
the petition for New River should in fact be dismissed.
The Debtors have determined that Riverwalk only owns 25% minority
member interest in New River, an interest insufficient to cause
the bankruptcy filing by New River.
The Debtors ask the Court to direct the use of an amended caption
that has been revised to exclude New River in the footnoted list
of Debtors following dismissal of the case.
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 Dec. 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. As of Dec. 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: Wantsto Modify Ernst & Young Scope of Work
------------------------------------------------------
Tribune Co. and its units seek the Court's authority to modify the
scope of employment of Ernst & Young LLP for the limited purpose
of ensuring that the scope of its retention encompasses valuation
services for certain Federal Communication Commission licenses,
held by the Debtors, which valuations are to be done as of
November 30, 2009. The Debtors tell the Court that those services
are a continuation of similar services previously performed by
Ernst & Young under the Application for 2008 valuation services;
however, the Debtors anticipate that the 2009 valuation services
will be more limited and less costly than those already authorized
by the Court.
Specifically, under the supplemental application, Ernst & Young
will assist the Debtors' management with their impairment testing,
in accordance with SFAS 142, by determining the value of the FCC
Licenses as of November 30, 2009.
The Debtors seek to retain Ernst & Young to perform these services
relating to the 2009 valuation:
(a) interviews with Tribune management concerning the nature
of the FCC Licenses;
(b) consideration of any business plans, future performance
estimates or budgets relating to the FCC Licenses;
(c) consideration of applicable economic, industry, and
competitive environments, including relevant historical
and future estimated trends;
(d) valuation analysis of the FCC Licenses as of the Valuation
Date giving consideration to appropriate approaches to
value; and
(e) preparation of exhibits summarizing recommendations of a
range of fair values.
The Debtors project that Ernst & Young's fees in connection with
the FCC Services will be approximately $20,000 in total.
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 Dec. 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. As of Dec. 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: Wants Until July 1 to Remove Civil Actions
------------------------------------------------------
Tribune Company and its debtor affiliates ask Judge Carey of the
U.S. Bankruptcy Court for the District of Delaware to further
extend through July 1, 2010, their deadline to file notices of
removal of claims and causes of action related to their Chapter 11
cases with respect to claims and causes of action pending as of
the Petition Date.
Given the pending expiration of the Debtors' removal periods on
March 3, 2010, the Debtors intend that the operation of the Rule
9006-2 of the Local Rule of Bankruptcy Practice and Procedure of
the U.S. Bankruptcy Court for the District of Delaware will extend
the time during which the Debtors may remove actions from the
March 3 expiration until the conclusion of the hearing of the
Motion. The Debtors request that the Motion be heard on March 23,
2010.
The Debtors tell the Court that they have been engaged on an
ongoing basis since the Petition Date in:
(a) stabilizing their businesses;
(b) developing a multi-year business plan;
(c) conducting extensive operational, financial and legal
analysis relating to their businesses and a proposed plan
of reorganization;
(d) undertaking a number of significant transactions with the
approval of the Bankruptcy Court; and
(e) accomplishing most of the "case administration" tasks in
their Chapter 11 cases.
The Debtors assert that their efforts have resulted in substantial
progress toward the development and filing of a Plan that would
resolve their bankruptcy cases. The Debtors add that they have
made significant progress in addressing the prepetition claims
against their estates, with more than 15 omnibus objections having
already filed with and sustained essentially in their entireties
by the Bankruptcy Court.
"Given the magnitude of these tasks, together with the substantial
existing efforts required to manage the Debtors' business
enterprise, the demands on the Debtors' personnel and
professionals have been exceptional," says Kate J. Stickles, Esq.,
at Cole, Schotz, Meisel, Forman & Leonard, P.A., in Wilmington,
Delaware. "The Debtors accordingly have a legitimate need for
additional time to review their outstanding litigation matters and
evaluate whether those matters should properly be removed pursuant
to Bankruptcy Rule 9027," she adds.
Section 1452 of the Bankruptcy Code and Rule 9027 of the Federal
Rules of Bankruptcy Procedure govern the removal of claims and
causes of action pending as of the Petition Date.
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 Dec. 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. As of Dec. 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)
TROPICANA ENTERTAINMENT: Adamar Can Decide on Leases by March 31
----------------------------------------------------------------
Adamar of New Jersey, Inc., and its affiliate, Manchester Mall,
Inc., sought and obtained an order from the U.S. Bankruptcy Court
for the District of New Jersey an extension of the time to assume
or reject their Unexpired Leases until the earlier to occur of
March 31, 2010, or the closing of the sale of all of the Debtors'
assets.
About Tropicana Entertainment
Tropicana Entertainment LLC and its units owned eleven casino
properties in eight distinct gaming markets with premier
properties in Las Vegas, Nevada, and Atlantic City, New Jersey.
Tropicana Entertainment LLC and certain affiliates filed for
Chapter 11 protection on May 5, 2008 (Bankr. D. Del. Case No. 08-
10856). Kirkland & Ellis LLP and Mark D. Collins, Esq., at
Richards Layton & Finger, represent the Debtors in their
restructuring efforts. Their financial advisor is Lazard Ltd.
Their notice, claims, and balloting agent is Kurtzman Carson
Consultants LLC. Epiq Bankruptcy Solutions LLC is the Debtors'
Web site administration agent. AlixPartners LLP is the Debtors'
restructuring advisor. Stroock & Stroock & Lavan LLP and Morris
Nichols Arsht & Tunnell LLP represent the Official Committee of
Unsecured Creditors in this case. Capstone Advisory Group LLC is
financial advisor to the Creditors' Committee.
The OpCo Debtors, a group of Tropicana entities owning casinos and
resorts in Atlantic City, New Jersey and Evansville, Indiana have
obtained confirmation from the Bankruptcy Court of a
reorganization plan. A group of Tropicana entities, known as the
LandCo Debtors, which own Tropicana casino property in Las Vegas,
have obtained approval of a separate Chapter 11 plan.
On April 29, 2009, non-debtor units of the OpCo Debtors,
designated as the New Jersey Debtors -- Adamar of New Jersey,
Inc., and its affiliate, Manchester Mall, Inc. -- filed for
Chapter 11 (Bankr. D. N.J. Lead Case No. 09- 20711) to effectuate
a sale of the Atlantic City Resort and Casino to a group of
Investors-led by Carl Icahn. Judge Judith H. Wizmur presides
over the cases. Manchester Mall is a wholly owned subsidiary of
Adamar that owns and operates certain real property utilized in
the New Jersey Debtors' business operations.
Ilana Volkov, Esq., and Michael D. Sirota, Esq., at Cole, Schotz,
Meisel, Forman & Leonard, in Hackensack, New Jersey, represent the
New Jersey Debtors. Kurtzman Carson Consultants LLC acts as their
claims and notice agent. Adamar disclosed $500 million to
$1 billion both in total assets and debts in its petition.
Manchester Mall disclosed $1 million to $10 million in total
assets, and less than $50,000 in total debts in its petition.
Bankruptcy Creditors' Service, Inc., publishes Tropicana
Bankruptcy News. The newsletter tracks the chapter 11
restructuring proceedings commenced by Tropicana Entertainment LLC
and its affiliates. (http://bankrupt.com/newsstand/or
215/945-7000)
TROPICANA ENTERTAINMENT: Adamar Wants to Reject 63 Contracts
------------------------------------------------------------
As previously reported, on November 4, 2009, the Court approved
the Amended and Restated Purchase Agreement for (i) the sale of
substantially all of Adamar of New Jersey, Inc., and its
affiliate, Manchester Mall, Inc.'s assets, free and clear of all
liens, claims, encumbrances and interests, and (ii) the assumption
and assignment of additional executory contracts and unexpired
leases in relation to the Purchase Agreement.
In preparation for the closing on the Amended Purchase Agreement,
and after a review of finances and operations, the NJ Debtors
determined that some of the Acquired Contracts are unnecessary to
their continued business operations, are disadvantageous or
economically unfavorable as currently structured, Ilana Volkov,
Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., in
Hackensack, New Jersey, relates.
By this motion, the NJ Debtors seek to reject:
(i) 23 contracts that they determine are no longer necessary
to their continued business operations, effective as of
February 12, 2010; and
(ii) 40 contracts that they determine are disadvantageous or
economically unfavorable as currently structured on the
earlier to occur of entry of an order granting the
Contract Rejection Motion or February 26, 2010.
A list of the Unnecessary Contracts is available for free at:
http://bankrupt.com/misc/TropiA_UnnecessaryContracts021210.pdf
A list of the Disadvantageous Contracts is available for free at:
http://bankrupt.com/misc/TropiA_DisadvantageousContracts021210.pdf
Approval of nunc pro tunc rejection of the Contracts is
appropriate, Ms. Volkov asserts. She further emphasizes that the
balance of equities favors granting the Debtors' request for a
retroactive effective date of rejection because, among other
things:
(a) the Unnecessary Contracts provide no benefit to the
estates as the Debtors are no longer utilizing the
services specified in those contracts, and the Debtors
will be forced to incur unnecessary administrative
expenses for those services; and
(b) with respect to the Disadvantageous Contracts, if the
Rejection Motion is not heard before February 26, the
Debtors will incur unnecessary administrative expenses
commencing on March 1, 2010, on account of contracts that
are economically unfavorable. This would be harmful to
the Debtors and their estates.
Pursuant to the Amended Purchase Agreement, the Debtors and the
representative for the steering committee of certain "Secured
Parties" have agreed to amend the list of Acquired Contracts to
eliminate the 63 Contracts the Debtors seek to be rejected.
IGT Objects
International Gaming Technology objects to the Contract Rejection
Motion, asserting that the NJ Debtors have not articulated any
specific reason why the IGT Contracts are disadvantageous. In
the alternative, IGT seeks that any order authorizing the
rejection of the IGT Contracts be required compliance with
applicable New Jersey law.
IGT supplies gaming machines to the NJ Debtors. A June 12, 2009
Court order approved the assumption and assignment of the IGT
Contracts to purchaser of the NJ Debtors' assets. Subsequently,
the Court entered a consent order on August 24, 2009, fixing the
required cure amounts with respect to the IGT Contracts. By
entering into the August 2009 Consent Order, the NJ Debtors
signaled their continuing intention to assume and assign the IGT
Contracts, IGT points out.
John P. Leon, Esq., at Subranni Ostrove & Zauber, in Marlton, New
Jersey, tells the Court that the NJ Debtors seem to forget that
just seven months ago, they entered into a revised pricing
addendum with IGT with respect to the IGT Contracts for "Wide
Area Progressive Machines." The addendum extended the term of
those contracts and amended the pricing terms, he notes.
Mr. Leon also argues that the Rejection Motion fails to address
requirements of New Jersey law and the New Jersey Casino Control
Commission with respect to the gaming machines subject of the IGT
Contracts. Some of those machines pay out "progressive
jackpots." He notes that New Jersey law prohibits the
simultaneous removal of those kinds of machines from the NJ
Debtors' premises, as they are part of a Wide Area Progress
System, in which more than one casino participates.
* * *
Judge Wizmur permits the NJ Debtors to reject (i) the Unnecessary
Contracts nunc pro tunc to February 12, 2010, and (ii) the
Disadvantageous Contracts as of February 23, 2010.
Proofs of claim, if any, arising from the rejection of the
Contracts should be filed no later than March 25, 2010, with
Kurtzman Carson Consultants LLC, or the counterparties to the
Contracts will be forever barred from asserting claims against
the Debtors and their estates.
About Tropicana Entertainment
Tropicana Entertainment LLC and its units owned eleven casino
properties in eight distinct gaming markets with premier
properties in Las Vegas, Nevada, and Atlantic City, New Jersey.
Tropicana Entertainment LLC and certain affiliates filed for
Chapter 11 protection on May 5, 2008 (Bankr. D. Del. Case No. 08-
10856). Kirkland & Ellis LLP and Mark D. Collins, Esq., at
Richards Layton & Finger, represent the Debtors in their
restructuring efforts. Their financial advisor is Lazard Ltd.
Their notice, claims, and balloting agent is Kurtzman Carson
Consultants LLC. Epiq Bankruptcy Solutions LLC is the Debtors'
Web site administration agent. AlixPartners LLP is the Debtors'
restructuring advisor. Stroock & Stroock & Lavan LLP and Morris
Nichols Arsht & Tunnell LLP represent the Official Committee of
Unsecured Creditors in this case. Capstone Advisory Group LLC is
financial advisor to the Creditors' Committee.
The OpCo Debtors, a group of Tropicana entities owning casinos and
resorts in Atlantic City, New Jersey and Evansville, Indiana have
obtained confirmation from the Bankruptcy Court of a
reorganization plan. A group of Tropicana entities, known as the
LandCo Debtors, which own Tropicana casino property in Las Vegas,
have obtained approval of a separate Chapter 11 plan.
On April 29, 2009, non-debtor units of the OpCo Debtors,
designated as the New Jersey Debtors -- Adamar of New Jersey,
Inc., and its affiliate, Manchester Mall, Inc. -- filed for
Chapter 11 (Bankr. D. N.J. Lead Case No. 09- 20711) to effectuate
a sale of the Atlantic City Resort and Casino to a group of
Investors-led by Carl Icahn. Judge Judith H. Wizmur presides
over the cases. Manchester Mall is a wholly owned subsidiary of
Adamar that owns and operates certain real property utilized in
the New Jersey Debtors' business operations.
Ilana Volkov, Esq., and Michael D. Sirota, Esq., at Cole, Schotz,
Meisel, Forman & Leonard, in Hackensack, New Jersey, represent the
New Jersey Debtors. Kurtzman Carson Consultants LLC acts as their
claims and notice agent. Adamar disclosed $500 million to
$1 billion both in total assets and debts in its petition.
Manchester Mall disclosed $1 million to $10 million in total
assets, and less than $50,000 in total debts in its petition.
Bankruptcy Creditors' Service, Inc., publishes Tropicana
Bankruptcy News. The newsletter tracks the chapter 11
restructuring proceedings commenced by Tropicana Entertainment LLC
and its affiliates. (http://bankrupt.com/newsstand/or
215/945-7000)
TROPICANA ENTERTAINMENT: Adamar Has Cash Access Until March 31
--------------------------------------------------------------
Adamar of New Jersey, Inc., and its affiliate, Manchester Mall,
Inc., sought and obtained an order from the U.S. Bankruptcy Court
for the District of New Jersey for an extension of their use of
the Cash Collateral, through and including the earlier of (i) the
sale closing date of the Tropicana Atlantic City assets, or (ii)
March 31, 2010.
The Court previously gave the New Jersey Debtors authority to
access the Cash Collateral through February 28, 2010.
The New Jersey Debtors tell the Court that they need continued
access to the Cash Collateral to be able to pay their
postpetition ordinary and necessary business expenses and fund
the administration of their Chapter 11 cases, while the closing
date of the sale of all of their assets is pending.
As previously reported, the New Jersey Debtors filed for
bankruptcy to effectuate the sale of all of their assets pursuant
to Section 363 of the Bankruptcy Code and to enable retired
Supreme Court Justice Gary S. Stein, as trustee/conservator of NJ
Debtor Adamar of New Jersey, Inc., to comply with applicable
statutory requirements and rulings of the New Jersey Casino
Control Commission to sell the stock or assets of Adamar. A
group of investor led by Carl Icahn won the bid to acquire the
Adamar Assets and the parties entered into a Purchase Agreement,
as amended. The parties though need to obtain certain regulatory
approvals and waivers before a closing on the sale transaction
can occur.
The NJ Commission has consented to an extension of the sale
deadline of the Adamar Assets several times, with the current
deadline set for June 4, 2010.
The sale parties have also amended the Purchase Agreement to
provide that the outside date by which the transactions
contemplated in the Purchase Agreement must close is extended
through March 31, 2010.
Against this backdrop, the Prepetition Agent for the Debtors'
Prepetition Credit Facility, at the direction of the "Required
Lenders," and the Steering Committee have consented to an
extension of the Cash Collateral Use on terms set forth in a
stipulation and consent order entered on February 22, 2010.
The Stipulating Parties consent to the Debtors' continued use of
the Cash Collateral in accordance with a budget for the four-week
period ending March 31, 2010.
A full-text copy of the Cash Collateral Use Extension Stipulation
and the prepared March 2010 budget are available for free at:
http://bankrupt.com/misc/TropiA_StipCashColl022210.pdf
Accordingly, the Court approves that Stipulating Parties'
February 22 stipulation.
About Tropicana Entertainment
Tropicana Entertainment LLC and its units owned eleven casino
properties in eight distinct gaming markets with premier
properties in Las Vegas, Nevada, and Atlantic City, New Jersey.
Tropicana Entertainment LLC and certain affiliates filed for
Chapter 11 protection on May 5, 2008 (Bankr. D. Del. Case No. 08-
10856). Kirkland & Ellis LLP and Mark D. Collins, Esq., at
Richards Layton & Finger, represent the Debtors in their
restructuring efforts. Their financial advisor is Lazard Ltd.
Their notice, claims, and balloting agent is Kurtzman Carson
Consultants LLC. Epiq Bankruptcy Solutions LLC is the Debtors'
Web site administration agent. AlixPartners LLP is the Debtors'
restructuring advisor. Stroock & Stroock & Lavan LLP and Morris
Nichols Arsht & Tunnell LLP represent the Official Committee of
Unsecured Creditors in this case. Capstone Advisory Group LLC is
financial advisor to the Creditors' Committee.
The OpCo Debtors, a group of Tropicana entities owning casinos and
resorts in Atlantic City, New Jersey and Evansville, Indiana have
obtained confirmation from the Bankruptcy Court of a
reorganization plan. A group of Tropicana entities, known as the
LandCo Debtors, which own Tropicana casino property in Las Vegas,
have obtained approval of a separate Chapter 11 plan.
On April 29, 2009, non-debtor units of the OpCo Debtors,
designated as the New Jersey Debtors -- Adamar of New Jersey,
Inc., and its affiliate, Manchester Mall, Inc. -- filed for
Chapter 11 (Bankr. D. N.J. Lead Case No. 09- 20711) to effectuate
a sale of the Atlantic City Resort and Casino to a group of
Investors-led by Carl Icahn. Judge Judith H. Wizmur presides
over the cases. Manchester Mall is a wholly owned subsidiary of
Adamar that owns and operates certain real property utilized in
the New Jersey Debtors' business operations.
Ilana Volkov, Esq., and Michael D. Sirota, Esq., at Cole, Schotz,
Meisel, Forman & Leonard, in Hackensack, New Jersey, represent the
New Jersey Debtors. Kurtzman Carson Consultants LLC acts as their
claims and notice agent. Adamar disclosed $500 million to
$1 billion both in total assets and debts in its petition.
Manchester Mall disclosed $1 million to $10 million in total
assets, and less than $50,000 in total debts in its petition.
Bankruptcy Creditors' Service, Inc., publishes Tropicana
Bankruptcy News. The newsletter tracks the chapter 11
restructuring proceedings commenced by Tropicana Entertainment LLC
and its affiliates. (http://bankrupt.com/newsstand/or
215/945-7000)
UAL CORP: Capital World Has 7.4% Equity Stake
---------------------------------------------
In a Schedule 13G/A filed with the Securities and Exchange
Commission dated February 5, 2010, Capital World Investors stated
that it beneficially owns 12,740,865 shares of UAL Corporation
Common Stock, representing 7.4% of UAL's total outstanding shares.
UAL had 167,040,862 shares of common stock outstanding as of
October 21, 2009.
Capital World has sole power to vote 6,443,820 shares of UAL
common stock and has sole power to dispose of 12,740,865 shares of
UAL common stock.
Capital World is a division of Capital Research and Management
Company.
Capital World Senior Vice President Robert W. Lovelace related
that shares reported by Capital World include 3,568,140 shares
resulting from the assumed conversion of $31,000 principal amount
of the 6.0% Convertible Senior Note due October 5, 2029 and
2,668,910 shares resulting from the assumed conversion of $87,100
principal amount from the assumed conversion of $87,100 principal
amount of the 4.5% Convertible Note due June 30, 2021.
About UAL Corporation
Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA) --
http://www.united.com/-- is the holding company for United
Airlines, Inc. United Airlines is the world's second largest air
carrier. The airline flies to Brazil, Korea and Germany.
The Company filed for Chapter 11 protection on Dec. 9, 2002
(Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen,
Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven
R. Kotarba, Esq., at Kirkland & Ellis, represented the Debtors in
their restructuring efforts. Fruman Jacobson, Esq., at
Sonnenschein Nath & Rosenthal LLP represented the Official
Committee of Unsecured Creditors. Judge Eugene R. Wedoff
confirmed a reorganization plan for United on Jan. 20, 2006. The
Company emerged from bankruptcy on Feb. 1, 2006. (United Airlines
Bankruptcy News; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
UAL Corp. carries a 'Caa1' probability of default rating from
Moody's, 'B-' long term foreign issuer credit rating from Standard
& Poor's, and 'CCC' long term issuer default rating from Fitch.
UAL CORP: FMR LLC Has 15% Equity Stake
--------------------------------------
In a Schedule 13-G/A filed with the U.S. Securities and Exchange
Commission dated February 12, 2010, FMR LLC disclosed that it
beneficially owns 25,620,240 shares of UAL Corp. common stock,
representing 15% of UAL's total outstanding shares.
UAL had 167,040,862 shares of common stock outstanding as of
October 21, 2009.
FMR has sole power to dispose of or to direct the disposition of
the 25,620,240 shares. FMR has sole power to vote or direct the
vote of 47,801 shares of UAL common stock.
Fidelity Management & Research
As a wholly owned subsidiary of FMR, and as investment adviser to
various investment companies, Fidelity Management & Research
Company is the beneficial owner of 25,571,139 shares or
14.972% of UAL's common stock outstanding.
The number of UAL shares owned by the investment companies at
December 31, 2009, included 1,688,676 shares of Common Stock
resulting from the assumed conversion of $55,110,000 principal
amount of UAL CORP CV 4.5% 6/30/21 144A -- 30.6419 shares of
Common Stock for each $1,000 principal amount of debenture.
The number of UAL shares owed by the investment companies at
December 31, 2009, included 2,071,824 shares of common stock
resulting from the assumed conversion of $18,000,000 principal
amount of UAL Corp. CONV 6% 10/15/29 -- 115.1013 shares of Common
Stock for each $1,000 principal amount of debenture.
FMR and its chairman, Edward C. Johnson 3d, through their control
of Fidelity and the funds, each has sole power to dispose of the
25,572,439 shares owned by the Funds.
Members of Mr. Johnson's family are the predominant owners,
directly or through trusts, of Series B shares of FMR common
stock representing 49% of FMR's voting power. The Johnson family
group and all other Series B shareholders have entered into a
shareholders' voting agreement under which all Series B shares
will be voted in accordance with the majority vote of Series B
shares. Accordingly, through their ownership of voting common
stock and the execution of the shareholders' voting agreement,
members of the Johnson family may be deemed, under the Investment
Company Act of 1940, to form a controlling group with respect to
FMR.
Neither FMR nor Mr. Johnson has the sole power to vote or direct
the voting of the shares owned directly by the Fidelity Funds,
which power resides with the Funds' Boards of Trustees. Fidelity
carries out the voting of the shares under written guidelines
established by the Funds' Boards of Trustees.
An indirect wholly owned subsidiary of FMR, Pyramis Global
Advisors Trust Company is the beneficial owner of 43,511 shares or
0.025% of the outstanding Common Stock of UAL Corp. as a result of
its serving as investment manager of institutional accounts owning
these shares. The number of UAL shares owned by the institutional
accounts at December 31, 2009, included 43,511 shares of Common
Stock resulting from the assumed conversion of $1,420,000
principal amount of UAL CORP CONV 4.5% 6/30/21 -- 30.6419 shares
of Common Stock for each $1,000 principal amount of debenture.
FMR and Edward C. Johnson 3d, through their control of Pyramis
Global Advisors Trust Company, each has sole dispositive power of
43,511 shares and sole power to vote or to direct the voting of
43,511 shares.
A wholly owned subsidiary of FMR, Pyramis Global Advisors Trust
Company is the beneficial owner of 4,290 shares or 0.003% of the
outstanding Common Stock of UAL as a result of its serving as
investment manager of institutional accounts owning these shares.
The number of shares of Common Stock of UAL Corporation owned by
the institutional accounts at December 31, 2009, included 4,290
shares of Common Stock resulting from the assumed conversion of
$140,000 principal amount of UAL CORP CONV 4.5% 6/30/21 -- 30.6419
shares of Common Stock for each $1,000 principal amount of
debenture.
Edward C. Johnson 3d and FMR, through its control of Pyramis
Global Advisors Trust Company, each has sole dispositive power
over 4,290 shares and sole power to vote or to direct the voting
of 4,290 shares of Common Stock owned by the institutional
accounts managed by PGATC.
About UAL Corporation
Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA) --
http://www.united.com/-- is the holding company for United
Airlines, Inc. United Airlines is the world's second largest air
carrier. The airline flies to Brazil, Korea and Germany.
The Company filed for Chapter 11 protection on Dec. 9, 2002
(Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen,
Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven
R. Kotarba, Esq., at Kirkland & Ellis, represented the Debtors in
their restructuring efforts. Fruman Jacobson, Esq., at
Sonnenschein Nath & Rosenthal LLP represented the Official
Committee of Unsecured Creditors. Judge Eugene R. Wedoff
confirmed a reorganization plan for United on Jan. 20, 2006. The
Company emerged from bankruptcy on Feb. 1, 2006. (United Airlines
Bankruptcy News; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
UAL Corp. carries a 'Caa1' probability of default rating from
Moody's, 'B-' long term foreign issuer credit rating from Standard
& Poor's, and 'CCC' long term issuer default rating from Fitch.
UAL CORP: Janus Capital Has 12% Equity Stake
--------------------------------------------
In a Schedule 13G/A filed with the U.S. Securities and Exchange
Commission dated February 16, 2010, Janus Capital Management LLC
reported that it beneficially owns 20,076,689 shares of UAL
Corporation's common stock, representing 12% of UAL's total
outstanding shares.
UAL had 167,040,862 shares of common stock outstanding as of
October 21, 2009.
Janus has sole power to vote and dispose of 20,076,217 shares of
UAL common stock.
Janus has shared power to vote and dispose of 472 shares of UAL
common stock.
Janus Capital has a direct 91.8% ownership stake in INTECH
Investment Management and a direct 77.8% ownership stake in
Perkins Investment Management LLC. Due to this ownership
structure, holdings of Janus Capital, Perkins and INTECH are
aggregated for purposes of the Schedule 13G/A. Janus Capital,
Perkins and INTECH are registered investment advisers, each
furnishing investment advice to various investment companies
registered under Section 8 of the Investments Company Act of 1940
and to individual and institutional clients.
As a result of its role as investment advisor or sub-adviser to
the Managed Portfolios, Janus Capital may be deemed to be the
beneficial owner of 20,076,217 shares, which include (i)
19,953,649 held directly by Janus Capital and (ii) 122,568 shares
that may be acquired by Janus Capital upon the conversion of
bonds, or 12% of the shares outstanding of UAL common stock held
by the Managed Portfolios. However, Janus Capital does not have
the right to receive any dividends from, or the proceeds from the
sale of, the securities held in the Managed Portfolios and
disclaims any ownership with these rights.
As a result of its role as investment adviser or sub-adviser to
the Managed Portfolios, Perkins may be deemed to be the beneficial
owner of 472 shares or 0.0% of the shares outstanding of UAL
common stock held by the Managed Portfolios. However, Perkins
does not have the right to receive any dividends from, or the
proceeds from the sale of, the securities held in the Managed
Portfolios and disclaims any ownership associated with these
rights.
About UAL Corporation
Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA) --
http://www.united.com/-- is the holding company for United
Airlines, Inc. United Airlines is the world's second largest air
carrier. The airline flies to Brazil, Korea and Germany.
The Company filed for Chapter 11 protection on Dec. 9, 2002
(Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen,
Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven
R. Kotarba, Esq., at Kirkland & Ellis, represented the Debtors in
their restructuring efforts. Fruman Jacobson, Esq., at
Sonnenschein Nath & Rosenthal LLP represented the Official
Committee of Unsecured Creditors. Judge Eugene R. Wedoff
confirmed a reorganization plan for United on Jan. 20, 2006. The
Company emerged from bankruptcy on Feb. 1, 2006. (United Airlines
Bankruptcy News; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
UAL Corp. carries a 'Caa1' probability of default rating from
Moody's, 'B-' long term foreign issuer credit rating from Standard
& Poor's, and 'CCC' long term issuer default rating from Fitch.
UAL CORP: Par Investment Has 5.63% Equity Stake
-----------------------------------------------
In a Schedule 13G/A filed with the Securities and Exchange
Commission dated February 12, 2010, PAR Investment Partners, L.P.,
related that it beneficially owns 9,411,698 shares of UAL
Corporation Common Stock, par value $0.01, representing 5.63% of
UAL's total outstanding shares.
UAL had 167,040,862 shares of common stock outstanding as of
October 21, 2009.
PAR Investment has sole power to vote on and has sole power to
dispose of 9,411,698 shares of UAL common stock.
Moreover, each of PAR Group, L.P. and PAR Capital Management,
Inc., beneficially owns 9,411,698 shares of UAL common stock, par
value $0.01, representing 5.63% of UAL's total outstanding shares.
PAR Group and PAR Capital each has sole power to vote on and sole
power to dispose of 9,411,698 shares of UAL common stock.
PAR Investment is a private investment partnership engaging in the
purchase and sale of securities for its own account. PAR Group is
the sole general partner of PAR Investment. Moreover, PAR Capital
is the sole general partner of PAR Group.
PAR Investment Vice President Gina DiMento said that the position
included in the PAR Entities' Schedule 13G/A includes 8,340,000
shares of UAL common stock as well as 1,071,698 shares of common
stock of common stock issuable to PAR Investment upon conversion
of $47,042,916 principal amount of 5.00% Convertible Notes due
February 1, 2021, at a conversion price of $22.7813. PAR
Investment has sole investment discretion and sole voting power of
the shares, she added.
About UAL Corporation
Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA) --
http://www.united.com/-- is the holding company for United
Airlines, Inc. United Airlines is the world's second largest air
carrier. The airline flies to Brazil, Korea and Germany.
The Company filed for Chapter 11 protection on Dec. 9, 2002
(Bankr. N.D. Ill. Case No. 02-48191). James H.M. Sprayregen,
Esq., Marc Kieselstein, Esq., David R. Seligman, Esq., and Steven
R. Kotarba, Esq., at Kirkland & Ellis, represented the Debtors in
their restructuring efforts. Fruman Jacobson, Esq., at
Sonnenschein Nath & Rosenthal LLP represented the Official
Committee of Unsecured Creditors. Judge Eugene R. Wedoff
confirmed a reorganization plan for United on Jan. 20, 2006. The
Company emerged from bankruptcy on Feb. 1, 2006. (United Airlines
Bankruptcy News; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
UAL Corp. carries a 'Caa1' probability of default rating from
Moody's, 'B-' long term foreign issuer credit rating from Standard
& Poor's, and 'CCC' long term issuer default rating from Fitch.
UNIVERSAL PACKAGING LDS: Voluntary Chapter 11 Case Summary
----------------------------------------------------------
Debtor: Universal Packaging, Inc.
1308 Upland Drive
Houston, TX 77043
Bankruptcy Case No.: 10-31657
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Southern District of Texas (Houston)
Judge: Marvin Isgur
Debtor's Counsel: Margaret Maxwell McClure, Esq.
Attorney at Law
909 Fannin, Suite 3810
Houston, TX 77010
Tel: (713) 659-1333
Fax: (713) 658-0334
Email: mccluremar@aol.com
Estimated Assets: Not Stated
Estimated Debts: Not Stated
The Debtor did not file a list of its 20 largest unsecured
creditors when it filed its petition.
The petition was signed by John C. Wylie, president of the
Company.
VIKING SYSTEMS: Squar Milner Raises Going Concern Doubt
-------------------------------------------------------
The report from Viking Systems, Inc.'s independent registered
public accounting firm, Squar, Milner, Peterson, Miranda &
Williamson, LLP, dated February 22, 2010, includes a going concern
explanatory paragraph which states that factors relating to the
Company's net losses and working capital concerns raise
substantial doubt the Company's ability to continue as a going
concern.
Viking Systems said it will need to generate significant
additional revenue to achieve profitability and it may require
additional financing during 2010. "The going concern explanatory
paragraph in the independent auditor's report emphasizes the
uncertainty related to our business as well as the level of risk
associated with an investment in our common stock," Viking Systems
said.
A full-text copy of the Company's annual report on Form 10-K is
available at no charge at http://ResearchArchives.com/t/s?5455
Last week, the Company reported a net loss applicable to common
shareholders of $1,074,319 for fiscal year 2009 from a net loss of
$5,752,057 for 2008.
At December 31, 2009, the Company had total assets of $2,952,664
against total liabilities, all current, of $2,048,970. At
December 31, 2009, the Company had an accumulated deficit of
$26,297,978 and stockholders' equity of $903,694. At December 31,
2008, stockholders' equity was $1,385,663.
About Viking Systems
Based in Westborough, Massachusetts, Viking Systems, Inc. (OTCBB:
VKNG.OB) -- http://www.vikingsystems.com/-- is a developer,
manufacturer and marketer of visualization solutions for complex
minimally invasive surgery. The Company partners with medical
device companies and healthcare facilities to provide surgeons
with proprietary visualization systems enabling minimally invasive
surgical procedures, which reduce patient trauma and recovery
time.
WABASH NATIONAL: Schneider Capital Holds 5.69% of Common Stock
--------------------------------------------------------------
Schneider Capital Management Corporation disclosed that as of
December 31, 2009, it may be deemed to beneficially own 1,773,422
shares or roughly 5.69% of the common stock of Wabash National
Corporation.
About Wabash National
Headquartered in Lafayette, Indiana, Wabash National Corporation
manufactures semi-trailers in North America. Established in 1985,
the company specializes in the design and production of dry
freight vans, refrigerated vans, flatbed trailers, drop deck
trailers, dump trailers, truck bodies and intermodal equipment.
As of December 31, 2009, the Company had $223.777 million in total
assets, including total current assets of $76.867 million; against
total current liabilities of $111.794 million, long-term debt of
$28.437 million, capital lease obligation of $4.469 million, other
noncurrent liabilities and contingencies of $3.258 million,
Preferred stock of $22.334 million; and Stockholders' equity of
$53.485 million.
As reported by the Troubled Company Reporter, Wabash on July 17,
2009, entered into a Third Amended and Restated Loan and Security
Agreement, which was effective August 3, 2009, with Bank of
America, N.A., as a lender and as agent and the other lender
parties. The Credit Agreement has a maturity date of August 3,
2012. The Amended Facility has a capacity of $100 million,
subject to a borrowing base, and borrowings outstanding totaled
$25.5 million at August 3, 2009. The lenders waived certain
events of default that had occurred under the previous credit
facility and waived the right to receive default interest during
the time the events of default had continued.
WABASH NATIONAL: Tontine Funds Hold 0.92% of Common Stock
---------------------------------------------------------
Tontine Overseas Associates, L.L.C.; Tontine Capital Partners,
L.P.; Tontine Capital Management, L.L.C.; and Jeffrey L. Gendell
disclosed that as of December 31, 2009, they may be deemed to
beneficially own in the aggregate 288,145 shares or roughly 0.92%
of the common stock of Wabash National Corporation.
Tontine Overseas Associates, L.L.C., serves as investment manager
to Tontine Capital Overseas Master Fund, L.P., a Cayman Islands
partnership.
About Wabash National
Headquartered in Lafayette, Indiana, Wabash National Corporation
manufactures semi-trailers in North America. Established in 1985,
the company specializes in the design and production of dry
freight vans, refrigerated vans, flatbed trailers, drop deck
trailers, dump trailers, truck bodies and intermodal equipment.
As of December 31, 2009, the Company had $223.777 million in total
assets, including total current assets of $76.867 million; against
total current liabilities of $111.794 million, long-term debt of
$28.437 million, capital lease obligation of $4.469 million, other
noncurrent liabilities and contingencies of $3.258 million,
Preferred stock of $22.334 million; and Stockholders' equity of
$53.485 million.
As reported by the Troubled Company Reporter, Wabash on July 17,
2009, entered into a Third Amended and Restated Loan and Security
Agreement, which was effective August 3, 2009, with Bank of
America, N.A., as a lender and as agent and the other lender
parties. The Credit Agreement has a maturity date of August 3,
2012. The Amended Facility has a capacity of $100 million,
subject to a borrowing base, and borrowings outstanding totaled
$25.5 million at August 3, 2009. The lenders waived certain
events of default that had occurred under the previous credit
facility and waived the right to receive default interest during
the time the events of default had continued.
WABASH NATIONAL: Dimensional Fund Advisors Holds 7.14% Stake
------------------------------------------------------------
Dimensional Fund Advisors LP disclosed that as of December 31,
2009, it may be deemed to beneficially own 2,228,317 shares or
roughly 7.14% of the common stock of Wabash National Corporation.
About Wabash National
Headquartered in Lafayette, Indiana, Wabash National Corporation
manufactures semi-trailers in North America. Established in 1985,
the company specializes in the design and production of dry
freight vans, refrigerated vans, flatbed trailers, drop deck
trailers, dump trailers, truck bodies and intermodal equipment.
As of December 31, 2009, the Company had $223.777 million in total
assets, including total current assets of $76.867 million; against
total current liabilities of $111.794 million, long-term debt of
$28.437 million, capital lease obligation of $4.469 million, other
noncurrent liabilities and contingencies of $3.258 million,
Preferred stock of $22.334 million; and Stockholders' equity of
$53.485 million.
As reported by the Troubled Company Reporter, Wabash on July 17,
2009, entered into a Third Amended and Restated Loan and Security
Agreement, which was effective August 3, 2009, with Bank of
America, N.A., as a lender and as agent and the other lender
parties. The Credit Agreement has a maturity date of August 3,
2012. The Amended Facility has a capacity of $100 million,
subject to a borrowing base, and borrowings outstanding totaled
$25.5 million at August 3, 2009. The lenders waived certain
events of default that had occurred under the previous credit
facility and waived the right to receive default interest during
the time the events of default had continued.
WABASH NATIONAL: Franklin Resources Holds 11.1% of Common Stock
---------------------------------------------------------------
Franklin Resources, Inc.; Charles B. Johnson; Rupert H. Johnson,
Jr.; and Franklin Advisory Services, LLC, disclosed that as of
December 31, 2009, they may be deemed to beneficially own
3,453,700 shares or roughly 11.1% of the common stock of Wabash
National Corporation.
Charles B. Johnson and Rupert H. Johnson, Jr., each own in excess
of 10% of the outstanding common stock of FRI and are the
principal stockholders of FRI.
About Wabash National
Headquartered in Lafayette, Indiana, Wabash National Corporation
manufactures semi-trailers in North America. Established in 1985,
the company specializes in the design and production of dry
freight vans, refrigerated vans, flatbed trailers, drop deck
trailers, dump trailers, truck bodies and intermodal equipment.
As of December 31, 2009, the Company had $223.777 million in total
assets, including total current assets of $76.867 million; against
total current liabilities of $111.794 million, long-term debt of
$28.437 million, capital lease obligation of $4.469 million, other
noncurrent liabilities and contingencies of $3.258 million,
Preferred stock of $22.334 million; and Stockholders' equity of
$53.485 million.
As reported by the Troubled Company Reporter, Wabash on July 17,
2009, entered into a Third Amended and Restated Loan and Security
Agreement, which was effective August 3, 2009, with Bank of
America, N.A., as a lender and as agent and the other lender
parties. The Credit Agreement has a maturity date of August 3,
2012. The Amended Facility has a capacity of $100 million,
subject to a borrowing base, and borrowings outstanding totaled
$25.5 million at August 3, 2009. The lenders waived certain
events of default that had occurred under the previous credit
facility and waived the right to receive default interest during
the time the events of default had continued.
WABASH NATIONAL: Stephanie Kushner to Step Down From Board
----------------------------------------------------------
Stephanie K. Kushner, a Director of Wabash National Corporation,
has decided not to stand for re-election to the Company's Board of
Directors. She will retire from the Board at the Company's 2010
annual meeting of stockholders to be held on May 13, 2010.
Ms. Kushner joined the Company's Board of Directors in February
2004. In addition, on that date Andrew C. Boynton, a member of
the Company's Board of Directors since July 2009, announced his
decision to resign from the Board effective immediately.
About Wabash National
Headquartered in Lafayette, Indiana, Wabash National Corporation
manufactures semi-trailers in North America. Established in 1985,
the company specializes in the design and production of dry
freight vans, refrigerated vans, flatbed trailers, drop deck
trailers, dump trailers, truck bodies and intermodal equipment.
As of December 31, 2009, the Company had $223.777 million in total
assets, including total current assets of $76.867 million; against
total current liabilities of $111.794 million, long-term debt of
$28.437 million, capital lease obligation of $4.469 million, other
noncurrent liabilities and contingencies of $3.258 million,
Preferred stock of $22.334 million; and Stockholders' equity of
$53.485 million.
As reported by the Troubled Company Reporter, Wabash on July 17,
2009, entered into a Third Amended and Restated Loan and Security
Agreement, which was effective August 3, 2009, with Bank of
America, N.A., as a lender and as agent and the other lender
parties. The Credit Agreement has a maturity date of August 3,
2012. The Amended Facility has a capacity of $100 million,
subject to a borrowing base, and borrowings outstanding totaled
$25.5 million at August 3, 2009. The lenders waived certain
events of default that had occurred under the previous credit
facility and waived the right to receive default interest during
the time the events of default had continued.
WE & MK SHIELDS: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: WE & MK Shields Family Limited Partnership
6601 Anns Lane
Weatherford, TX 76085
Bankruptcy Case No.: 10-41463
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Northern District of Texas (Ft. Worth)
Judge: Russell F. Nelms
Debtor's Counsel: Julie C. John, Esq.
Forshey & Prostok, LLP
777 Main St., Suite 1290
Ft. Worth, TX 76102
Tel: (817) 877-8855
Email: jjohn@forsheyprostok.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $500,001 to $1,000,000
The Debtor did not file a list of its 20 largest unsecured
creditors when it filed its petition.
The petition was signed by William Shields.
WEST SIDE: Files for Bankruptcy to Eliminate $1.4 Million Debt
--------------------------------------------------------------
Brian Reisinger at Business Journal of Nashville reports that West
Side Rental & Sales filed for Chapter 11 bankruptcy in attempt to
reconcile more that $1.4 million in debts and pay off all its
debts. The company blamed poor economy for the filing.
The Company disclosed $2.6 million in assets and $1.4 million in
liabilities.
Based in Nashville, Tennessee, West Side Rental & Sale operates an
equipment rental company.
WHITTAKER LAUDERDALE: Voluntary Chapter 11 Case Summary
-------------------------------------------------------
Debtor: Whittaker Lauderdale Reef IV,
A Texas Limited Partnership
c/o Clark Lauderdale Company, Inc.
16775 Addison Rd, Suite 103
Addison, TX 75001
Bankruptcy Case No.: 10-31737
Chapter 11 Petition Date: March 1, 2010
Court: United States Bankruptcy Court
Southern District of Texas (Houston)
Judge: Jeff Bohm
Debtor's Counsel: Theresa D. Mobley, Esq.
Cage Hill et al
5851 San Felipe, Ste 950
Houston, TX 77057
Tel: (713) 789-0500
Fax: (713) 974-0344
Email: tmobley@cagehill.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor did not file a list of its 20 largest unsecured
creditors when it filed its petition.
The petition was signed by Kirk Freeman.
W.R. GRACE: Canada Courts Gives Final Nod for ZAI Settlement
------------------------------------------------------------
W.R. Grace & Co., Inc., informed the Bankruptcy Court and parties-
in-interest on February 25, 2010, that the order approving the
Amended and Restated Canadian ZAI Minutes of Settlement has been
entered as a final order.
On December 13, 2009, The Honorable Mr. Justice Geoffrey B.
Morawetz of Ontario Superior Court of Justice, who is overseeing
the reorganization proceedings of Grace Canada, Inc., approved the
Amended Minutes, which was entered into on November 16, 2009, by
Debtors and the claimants with respect to the Canadian Zonolite
Attic Insulations, Theodore L. Freedman, Esq., at Kirkland & Ellis
LLP, in New York, relates.
Subsequently, the Debtors amended their Joint Chapter 11 Plan of
Reorganization to incorporate the entered a formal order setting
forth his reasons for granting the "Canadian Approval Order.
The Amended and Restated Minutes, which outlines the procedures
and funding terms for resolving and paying Canadian ZAI Claims,
superseded and replaced the original Minutes of Settlement among
the parties dated September 2, 2008, which expired by its own
terms, says Mr. Freedman.
The Attorney General of Canada, on behalf of the Canadian
government, alleged that the Debtors and the representative
counsel for the Companies' Creditors Arrangement Act restated the
Original Minutes without including the Crown as a party.
On February 19, 2010, the Parties appeared before the Court of
Appeal for Ontario on the Crown's request for leave to appeal the
Canadian Approval Order. At that time, the Court of Appeal
determined that the test for leave to appeal had not been met and,
accordingly, denied the Crown's request.
In so denying, the Court of Appeal found that the "appeal does not
raise serious issues in relation to insolvency proceedings as
asserted by the Crown. Moreover, matters are proceeding
appropriately in both the United States and Canadian bankruptcy
and insolvency courts."
As a result, the Canadian Approval Order is now a Final Order,
which is not subject to further appeals. Thus, the condition
precedent to Plan confirmation that the Approval Order be entered
has been met and the Approval Order is a Final Order.
About W.R. Grace
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally.
The Company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura
Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP,
represent the Debtors in their restructuring efforts. The Debtors
hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock &
Stroock & Lavan, LLP, and Duane Morris, LLP, represent the
Official Committee of Unsecured Creditors. The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice. David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA.
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla
R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official
Committee of Asbestos Personal Injury Claimants. The Asbestos
Committee of Property Damage Claimants tapped Scott Baena, Esq.,
and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod,
LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel, LLP, represents the Official Committee of
Equity Security Holders.
W.R. Grace and its debtor affiliates, with the support of the
Official Committee of Asbestos Personal Injury Claimants, the
Asbestos PI Future Claimants' Representative and the Official
Committee of Equity Security Holders, have submitted a proposed
Chapter 11 plan of reorganization. The Chapter 11 plan is built
around an April 2008 settlement for all present and future
asbestos personal injury claims, and a subsequent settlement for
asbestos property damage claims. The Plan confirmation hearing
wrapped up on January 25.
Bankruptcy Creditors' Service, Inc., publishes W.R. Grace
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
W.R. GRACE: Reports $71.2 Million Net Income for 2009
-----------------------------------------------------
W.R. Grace & Co., on February 25, 2010, filed with the U.S.
Securities and Exchange Commission its annual financial report
for year ended December 31, 2009, in Form 10-K.
A summary of Grace's financial performance for the year ended
December 31, 2009, compared with the prior year:
* Sales for the year ended December 31, 2009, were
$2,825.0 million compared with $3,317.0 million for the prior
year, a 14.8% decrease. The sales decrease was due to lower
sales volumes (10.2%), unfavorable currency translation
(3.7%), lower cost of metals passed through to customers
(3.1%), and the deconsolidation of the Advanced Refining
Technology LLC joint venture (1.2%), partly offset by price
Increases (3.4%).
* Gross profit percentage for the year was 32.7% compared with
29.7% in the prior year. The improvement in gross profit
percentage was due to price increases primarily implemented
in the second half of 2008, a decrease in raw materials and
energy costs since their peak in the fourth quarter of 2008,
and lower factory overhead expenses resulting primarily from
restructuring activities.
* Core EBIT for the year was $255.3 million, down 14.8% from
the prior year, primarily due to lower sales volumes,
restructuring expenses, unfavorable currency translation,
and higher pension expenses, partly offset by an increase in
gross profit percentage, gains related to three product line
sales and the ART transaction, and lower selling, general
and administrative expenses. Core EBIT margin was 9.0%,
equal to the prior year level.
* Grace net income for the year ended December 31, 2009, was
$71.2 million, or $0.98 per diluted share, compared with
Grace net income of $121.5 million, or $1.68 per diluted
share, for the prior year.
* Adjusted Operating Cash Flow was $446.5 million for the year
ended December 31, 2009, compared with $389.5 million in the
prior year, a 14.6% increase. The increase in Adjusted
Operating Cash Flow was primarily due to improvements in
working capital and lower capital expenditures, partially
offset by the impact of lower Core EBIT. Net working
capital decreased by 27 days during 2009, including a
reduction of 13 days of inventory and an increase of 13 days
of accounts payable.
* Core EBIT return on invested capital increased to 22.3% from
22.1% in the prior year.
* Sales of the Grace Davison operating segment for the year
ended December 31, 2009, were $1,935.4 million, down 10.8%
compared with the prior year. Segment operating income for
the year ending December 31, 2009 was $331.3 million, a
19.1% increase compared with the prior year. Segment
operating margin was 17.1% compared with 12.8% for the prior
year. These results reflect the favorable effects of price
increases, lower raw materials and energy costs, gains
related to the sale of a product line and the ART
transaction, and lower operating expenses, partly offset by
the unfavorable effects of lower sales volume, the sale in
the first quarter of 2009 of high-cost inventories produced
in the fourth quarter of 2008, and currency translation.
* Sales of the Grace Construction Products operating segment
for the year ended December 31, 2009, were $889.6 million,
down 22.5% compared with the prior year. Segment operating
income for the year ended December 31, 2009 was
$106.4 million compared with $148.3 million for the prior
year, a 28.3% decrease. Segment operating margin was 12.0%
compared with 12.9% for the prior year, reflecting continued
weakness in the global construction market. These results
include the gains on the sale of two product lines in 2009 and
the restructuring following the sale of the pipe wrap product
line.
* Corporate costs related to core operations were
$86.9 million for the year ended December 31, 2009, compared
with $80.6 million in the prior year, an increase of 7.8%.
Corporate support function costs decreased 7.3% from the
prior year due primarily to savings from the restructuring
actions completed in 2009 and other cost reduction efforts.
Performance related compensation and other corporate costs
increased primarily due to higher incentive compensation
expenses and higher legal costs.
* Net cash provided by operating activities for the year ended
December 31, 2009, was $432.5 million compared with
$15.0 million for the prior year. Net cash provided by
operating activities in the prior year included a payment of
$252 million related to the settlement of certain
environmental claims relating to Grace's former vermiculite
operations in Libby, Montana. Capital expenditures for the
year ended December 31, 2009, were $93.8 million compared with
$132.2 million for the prior year. Available liquidity
excludes the company's debtor in possession credit facility,
which it is terminating.
* At December 31, 2009, Grade had available liquidity of
approximately $954.6 million, consisting of $893.0 million
in cash and cash equivalents and $61.6 million of available
credit under various non-U.S. credit facilities.
CHAPTER 11 PROCEEDINGS
A. E. Festa, President and Chief Executive Officer at Grace,
related that the resolution of the objections to the Joint Plan of
Reorganization proposed by the W.R. Grace and its debtor
affiliates, the Official Committee of Equity Security Holders, the
Official Committee of Asbestos Personal Injury Claimants and the
legal representative of future asbestos personal injury claimants
and related appeals could have a material effect on the terms and
timing of Grace's emergence from Chapter 11.
On March 9, 2009, the United States Bankruptcy Court for the
District of Delaware approved the disclosure statement explaining
the Plan. Objections to the Plan generally involve demands for
interest at rates higher than provided for in the Plan, assertions
that the Plan may impair insurers' contractual rights, assertions
that the Plan discriminates against Libby, Montana personal injury
claimants, and the classification and treatment of claims under
the Plan.
The Bankruptcy Court held hearings to approve the Plan on June 22
to 23, 2009, September 8 to 17, 2009, and October 13 to 14, 2009.
Parties-in-interest submitted post-hearing briefs in November and
December 2009. Closing arguments on confirmation of the Joint
Plan were held on January 4 to 6, 2010 and January 25, 2010.
Chapter 11 Expenses
Grace disclosed in its Form 10-K that it incurred significant
added costs that are directly attributable to operating in Chapter
11, consisting of net Chapter 11 expenses consist primarily of
legal, financial and consulting fees reduced by interest income
earned on cash and cash equivalents held by entities subject to
Chapter 11.
(In millions)
2009 2008 2007
----- ----- -----
Total Chapter 11 expenses $49.1 $63.6 $95.1
Interest (income) expense on
filing entity cash/
investment balances (1.1) 2.2 (8.7)
----- ----- -----
Chapter 11 expenses, net $48.0 $65.8 $86.4
===== ===== =====
The decrease in direct Chapter 11 expenses for 2009 from the prior
years was primarily due to a decrease in activity compared with
2008 when Grace was conducting a trial for estimating the
liability for Personal Injury Claims, which was suspended in April
2008 as a result of the PI Settlement.
Based on current liquidity and expected 2010 cash flow, Grace
expects to require new financing of up to $850 million to
consummate the Plan. In addition, Grace also intends to seek a
$200 million revolving credit facility in connection with its exit
financing. On February 16, 2010, the Bankruptcy Court granted
Grace the authority to enter into engagement letters with Goldman
Sachs and Deutsche Bank have been selected as lead lenders.
In preparation for emergence, in 2009, Grace repatriated
approximately $173 million from their non-US subsidiaries to fund
payment of bankruptcy claims. Grace's principal U.S. subsidiary
also holds a loan of approximately $355.5 million from a foreign
subsidiary. Grace expects that all or a substantial portion of
this loan will be repaid at the time of emergence.
At December 31, 2009, Grace had available liquidity of
$954.6 million, consisting of $893.0 million in cash and cash
equivalents (approximately $696 million in the U.S.), and
approximately $61.6 million of available credit under various non-
U.S. credit facilities.
Tax Matters
Mr. Festa further related that after emergence from Chapter 11
under the Company's proposed Joint Plan, or another plan of
reorganization that is ultimately confirmed, Grace expects to have
substantial future tax deductions. Upon emergence under the Joint
Plan, Grace would expect future tax deductions in the aggregate of
approximately $2 billion or more, primarily relating to asbestos,
environmental and other payments made at emergence and thereafter.
Mr. Festa said the extent to which the company will be able to use
those deductions after emergence will depend on Section 382 of the
Internal Revenue Code, which generally imposes an annual
limitation on a corporation's use of its deductions when a
corporation undergoes an "ownership change."
An ownership change is generally defined as a cumulative change of
50 percentage points or more in the ownership of certain
stockholders owning 5% or more of the outstanding Grace common
stock over a three year rolling period. If Grace is to have a
change of ownership under Section 382 of the Code, approximately
$2 billion of the future deductions could be at risk.
Accordingly, the proposed charter for the reorganized corporation
under the Joint Plan provides that in the event there has been a
25 percentage point change of ownership in outstanding Grace stock
after emergence, the Board of Directors will have the authority to
impose restrictions on the transfer of Grace stock with respect to
certain 5% shareholders, Mr. Festa pointed out. Those transfer
restrictions will generally not impose any limitations on a person
or other entity that holds less than 5% of the outstanding Grace
stock after emergence to either buy or sell Grace stock on the
open market.
LEGAL PROCEEDINGS
As of the Petition Date, Grace was a defendant in 65,656 asbestos-
related lawsuits, 17 involving claims for property damage and the
remainder involving 129,191 claims for personal injury.
Out of 380 asbestos property damage cases filed prior to the
Petition Date:
-- 140 were dismissed without payment of any damages or
settlement amounts;
-- judgments after trial were entered in favor of Grace in
nine cases;
-- judgments after trial were entered in favor of the
plaintiffs in eight cases for a total of $86.1 million;
-- 207 property damage cases were settled for a total of
$696.8 million; and
-- 16 cases remain outstanding. Of the 16 remaining cases,
eight relate to the Canadian Zonolite Attic Insulations and
eight relate to a number of former asbestos-containing
products.
Cumulatively through the Petition Date, 16,354 asbestos personal
injury lawsuits involving 35,720 Personal Injury Claims were
dismissed without payment and 55,489 lawsuits involving 163,698 PI
Claims were disposed of for a total of $645.6 million. As of the
Petition Date, 129,191 PI Claims were pending against Grace. A
substantial number of additional PI Claims would have been
received between the Petition Date and December 31, 2009 had such
PI Claims not been stayed by the Bankruptcy Court, according to
Grace.
Meanwhile, the total recorded asbestos-related liability as of
December 31, 2009 and December 31, 2008, including pre- and
postpetition settlements, was $1.7 million.
Grace has also entered into settlement agreements with various
excess insurance carriers. The unpaid maximum aggregate amount
available under these settlement agreements is $440 million.
Presently, Grace has no agreements in place with insurers with
respect to approximately $483 million of excess coverage. In
addition, Grace has $253 million of excess coverage with insolvent
or non-paying insurance carriers. Non-paying carriers are those
that, although technically solvent, are not currently meeting
their obligations to pay claims. Grace has filed and continues to
file claims in the insolvency proceedings of the carriers, and
periodically receives distributions from some of them.
As of December 31, 2009, there remains approximately $923 million
of excess coverage from 53 presently solvent insurers. Grace
estimates that eligible claims would have to exceed $4 billion to
access total coverage. Grace further estimates that it should be
entitled to approximately $500 million of insurance recovery.
Grace's estimate of insurance recovery may differ materially from
actual amounts received by Grace, or, if the Plan is confirmed and
becomes effective, the Personal Injury Trust.
A full-text copy of Grace's 2009 Annual Report on Form 10-K is
available for free at http://ResearchArchives.com/t/s?5550
W. R. Grace & Co. and Subsidiaries
Consolidated Balance Sheets
As of December 31, 2009
(In millions)
ASSETS
Current Assets
Cash and cash equivalents $893.0
Investment securities -
Cash value of life insurance, net -
Trade accounts receivable, less allowance 383.7
Inventories 220.6
Deferred income taxes 61.5
Other current assets 69.9
--------
Total Current Assets 1,628.7
Properties and equipment, net 690.1
Goodwill 118.6
Deferred income taxes 843.4
Asbestos-related insurance 500.0
Overfunded defined benefit pension plans 36.7
Investments in unconsolidated affiliates 45.7
Other assets 105.0
--------
Total Assets $3,968.2
========
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
Liabilities Not Subject to Compromise
Current Liabilities
Debt payable within one year $12.6
Accounts payable 174.2
Other current liabilities 307.9
--------
Total Current Liabilities 494.7
Debt payable after one year 10.9
Deferred income taxes 34.2
Underfunded defined benefit pension plans 372.2
Unfunded defined benefit pension plans 158.2
Other liabilities 41.4
--------
Total Liabilities Not Subject to Compromise 1,111.6
Liabilities Subject to Compromise
Prepetition bank debt plus accrued interest 850.6
Drawn letters of credit plus accrued interest 31.4
Income tax contingencies 117.9
Asbestos-related contingencies 1,700.0
Environmental contingencies 148.4
Postretirement benefits 171.2
Other liabilities and accrued interest 127.6
--------
Total Liabilities Subject to Compromise 3,147.1
Total Liabilities 4,258.7
Equity (Deficit)
Common stock issued 0.8
Paid-in capital 445.8
Accumulated deficit (175.4)
Treasury stock, at cost (55.9)
Accumulated other comprehensive income (loss) (514.5)
--------
Total W.R. Grace & Co. Shareholders'
Equity (Deficit) (299.2)
Non-controlling interest 8.7
--------
Total Shareholders'Equity (Deficit) (290.5)
--------
Total Liabilities and Shareholders'
Equity (Deficit) $3,968.2
========
W. R. Grace & Co. and Subsidiaries
Consolidated Statements of Operations
For the year ended December 31, 2009
(In millions)
Net sales $2,825.0
Cost of goods sold 1,900.7
--------
Gross profit 924.3
Selling, general and administrative expenses 570.8
Restructuring expenses 33.4
(Gains) loss on sales of product lines (33.9)
Research and development expenses 70.1
Defined benefit pension expense 85.6
Interest expense and related financing costs 38.3
Provision for environmental remediation 4.4
Chapter 11 expenses, net of interest income 48.0
Equity in earnings of unconsolidated affiliates (1.7)
Other (income) expense, net 16.6
--------
831.6
Income before income taxes 92.7
Benefit from (provision for) income taxes (11.5)
--------
Net income (loss) 81.2
Less: Net loss attributable to
noncontrolling interests (10.0)
--------
Net income attributable to W.R. Grace & Co.
shareholders $71.2
========
W. R. Grace & Co. and Subsidiaries
Consolidated Statements of Cash Flows
For the year ended December 31, 2009
(In millions)
OPERATING ACTIVITIES
Net income $81.2
Reconciliation to net cash provided by
(used for) operating activities:
Depreciation and amortization 113.0
Equity in unconsolidated affiliates (1.7)
Chapter 11 expenses, net 48.0
Provision for (benefit from) income taxes 11.5
Income taxes paid, net of refunds 28.2
Interest accrued on prepetition liabilities
subject to compromise 36.2
(Gains) loss on sales of product lines (33.9)
Net gain on disposal of assets (1.5)
Restructuring expenses 33.4
Payments for restructuring impairments (17.5)
Defined benefit pension expense 85.6
Payments under defined benefit pension arrangements (61.4)
Payments under postretirement benefit plans (3.6)
Net income from life insurance policies (1.2)
Provision for uncollectible receivables 4.3
Provision for environmental remediation 4.4
Expenditures for environmental remediation (7.7)
Expenditures for retained obligations of
divested businesses (0.3)
Changes in assets and liabilities,
excluding effect of foreign currency
translation:
Trade accounts receivable 96.8
Inventories 84.8
Accounts payable (32.1)
Due from unconsolidated affiliate 3.0
Other accruals and non-cash items 18.1
--------
Net cash provided by operating activities
before Chapter 11 expenses and settlements 487.6
Cash paid to resolve Chapter 11 contingencies -
Chapter 11 expenses paid (54.2)
--------
Net cash provided by operating activities 433.4
INVESTING ACTIVITIES
Capital expenditures (93.8)
Business acquired, net of cash acquired -
Purchases of equity investments (2.5)
Proceeds from termination of product lines 40.6
Cash impact from deconsolidation of business (17.5)
Proceeds from disposal of assets 8.6
Investments in short-term debt securities -
Proceeds from sales of investment securities 22.5
Net investment in life insurance policies (0.6)
Proceeds from termination of insurance policies 68.8
--------
Net cash provided by (used for)
investing activities 26.1
FINANCING ACTIVITIES
Dividends paid to non-controlling interests (40.4)
Net (repayments) borrowings (0.4)
Fees under DIP credit facility (1.9)
Proceeds from exercise of stock options 1.4
--------
Net cash (used for) financing activities (41.3)
Effect of currency exchange rate changes
on cash and cash equivalents 14.7
--------
Increase (Decrease) in cash & cash equivalents 432.9
Cash and cash equivalents, beginning of period 460.1
--------
Cash and cash equivalents, end of period $893.0
========
About W.R. Grace
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally.
The Company and its debtor-affiliates filed for Chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura
Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP,
represent the Debtors in their restructuring efforts. The Debtors
hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock &
Stroock & Lavan, LLP, and Duane Morris, LLP, represent the
Official Committee of Unsecured Creditors. The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice. David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA.
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla
R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official
Committee of Asbestos Personal Injury Claimants. The Asbestos
Committee of Property Damage Claimants tapped Scott Baena, Esq.,
and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod,
LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel, LLP, represents the Official Committee of
Equity Security Holders.
W.R. Grace and its debtor affiliates, with the support of the
Official Committee of Asbestos Personal Injury Claimants, the
Asbestos PI Future Claimants' Representative and the Official
Committee of Equity Security Holders, have submitted a proposed
Chapter 11 plan of reorganization. The Chapter 11 plan is built
around an April 2008 settlement for all present and future
asbestos personal injury claims, and a subsequent settlement for
asbestos property damage claims. The Plan confirmation hearing
wrapped up on January 25.
Bankruptcy Creditors' Service, Inc., publishes W.R. Grace
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
XENITH BANKSHARES: Gets Notice of Decision by NASDAQ
----------------------------------------------------
Xenith Bankshares, Inc. received a letter from The NASDAQ Stock
Market LLC informing it that a NASDAQ Hearings Panel has
determined to grant Xenith Bankshares' request to remain listed on
The NASDAQ Capital Market. The Panel's determination is subject
to the condition that on or before June 21, 2010, Xenith
Bankshares must satisfy all initial listing requirements for
listing on The NASDAQ Capital Market, and have its application for
initial listing approved by the Listing Qualifications Staff. If
Xenith Bankshares does not satisfy these conditions by that date,
the company's common stock will be delisted from The NASDAQ
Capital Market. As noted below, Xenith Bankshares believes that
it currently satisfies all initial listing requirements, other
than the market value of publicly held shares (MVPHS) requirement
applicable for a company seeking initial listing on The NASDAQ
Capital Market.
As Xenith Bankshares previously announced, on December 23, 2009,
it received a letter from NASDAQ stating that the December 22,
2009 merger of Xenith Corporation, a privately held company, with
and into First Bankshares, Inc. constituted a business combination
that resulted in a "change of control" pursuant to NASDAQ Listing
Rule 5110(a). Accordingly, the post-merger entity was required to
satisfy all of NASDAQ's initial listing criteria and complete the
initial listing process. The letter went on to state that the
initial listing application was not approved because Xenith
Bankshares did not meet the MVPHS requirement applicable for a
company seeking initial listing on The NASDAQ Capital Market
pursuant to NASDAQ Listing Rule 5505(b). At a hearing before the
Panel on January 28, 2010, Xenith Bankshares appealed NASDAQ's
determination and requested additional time to satisfy the MVPHS
requirement.
NASDAQ requires that the market value of the company's publicly
held shares be at least $15 million. As of the close of business
on December 22, 2009, the completion date of the merger, the
closing bid price for shares of First Bankshares' common stock was
$4.01, which resulted in a market value of publicly held shares of
$9,306,163. Since the hearing, shares of Xenith Bankshares'
common stock have traded between $5.50 and $6.00 per share. The
closing bid price for shares of Xenith Bankshares' common stock
must be at least $6.47 in order for the company to satisfy the
listing requirement's $15 million threshold.
There can be no assurance that Xenith Bankshares will satisfy all
initial listing requirements for listing on The NASDAQ Capital
Market, including the MVPHS requirement, by June 21, 2010.
If Xenith Bankshares does not satisfy all initial listing
requirements for listing on The NASDAQ Capital Market, the
company's common stock will be delisted from The NASDAQ Capital
Market. If Xenith Bankshares' common stock is delisted, the
company expects that its common stock will become eligible for
quotation on the OTC Bulletin Board and/or the Pink OTC Markets
following the approval by the Financial Industry Regulatory
Authority of an application by one or more market makers to
continue quoting the company's common stock.
About Xenith Bankshares
Xenith Bankshares, Inc. is the holding company for Xenith Bank.
Its headquarters are in Richmond, Virginia and it has branches in
Suffolk, Virginia and the Tysons Corner area of Northern Virginia.
ZANETT INC: Expects to Receive Delisting Notice
-----------------------------------------------
Zanett, Inc., disclosed that by March 15, 2010 it expects to
receive a delisting determination letter from the Nasdaq Stock
Market Listing Qualifications Department, due to Zanett's failure
to regain compliance with the Nasdaq Capital Market's minimum bid
price requirement for continued listing set forth in Nasdaq
Listing Rule 5550(a)(2). Zanett expects to request a hearing to
appeal the Nasdaq Staff's determination within seven days of
receipt of the letter. If such a request is made, no delisting
action will be taken until the hearing process concludes and the
Hearing Panel has issued a written decision.
Failure to request a hearing within seven calendar days will
result in the suspension and delisting of Zanett's securities
under the terms of the delisting determination letter. There can
be no assurance that the Hearing Panel will grant Zanett's request
for continued listing.
GENERAL TIMELINE
Oral hearings are held in Washington D.C. and are typically
scheduled 30 to 45 days from the company's request for a hearing
date. The Hearing Panel generally issues a written decision
approximately 35 days after the hearing, but the company could
receive a written decision sooner. Based on this timeline, Zanett
expects to be issued a written decision from the Hearing Panel no
sooner than 60 days from March 15, 2010. Until then, no delisting
action will be taken before the hearing process concludes and the
Hearing Panel has issued a written decision.
ZANETT'S PLAN
Dennis Harkins, Zanett's President stated, "We at Zanett plan to
file an appeal with the Hearing Panel, and to vehemently fight to
maintain our current Nasdaq listing. We believe we have a great
company, with a great business, and are on track to successfully
execute on our business plan. At $43 million in revenues, and a
big sales pipeline, we deserve the right to this appeal. Although
the outcome of any appeal process is never known, we believe we
stand a good chance for success."
NEXT STEPS
Once the delisting determination letter is received from Nasdaq,
Zanett plans to issue a press release within the proscribed 4
business days. Such future press release will announce the
receipt of Nasdaq's delisting determination and the basis for the
delisting, which includes citation of the applicable Listing
Rule(s).
BACKGROUND INFORMATION
On September 17, 2009, Zanett, Inc. received a letter from Nasdaq
notifying it that the bid price per share for the Company's common
stock has closed below the $1.00 minimum bid price requirement for
30 consecutive trading days and that, as a result, the Company no
longer meets minimum bid price requirement for continued listing
set forth in Nasdaq Listing Rule 5550(a)(2). No breach of any
other listing requirement was listed in the letter.
Pursuant to Listing Rule 5810(c)(3)(A), the Company had 180
calendar days, or until March 15, 2010, to regain compliance with
the minimum bid price requirement. To regain compliance, the
closing bid price of the Company's common stock must close above
$1.00 for a minimum of ten consecutive trading days. However,
Nasdaq may, in its discretion, require the Company to maintain a
minimum closing bid price of $1.00 per share for a period in
excess of ten consecutive trading days (but generally no longer
than 20 consecutive business days) before determining that the
Company has demonstrated an ability to maintain long-term
compliance with the rule.
About Zanett, Inc.
Zanett is a leading business process outsourcing (BPO), IT enabled
services (ITES), and information technology (IT) consulting firm
serving Fortune 500 corporations and mid-market organizations in
Healthcare, Life Sciences, Manufacturing & Distribution, Retail,
Gaming & Hospitality, and State & Local Government.
ZAYAT STABLES: Gets Cash for Operations After Fifth Third Accord
----------------------------------------------------------------
Nancy Kercheval at Bloomberg News reports that Zayat Stables LLC
and Fifth Third Bancorp reached an agreement to free up cash for
horse-racing operations while they settle a loan dispute.
The dispute began in December when Fifth Third filed a suit in
federal court saying Zayat Stables had defaulted on a loan under
which it owes $34.2 million. In an attempt to halt the action,
the stables filed for bankruptcy protection, citing Fifth Third's
"predatory lending practices."
Under the agreement reached by the parties, Zayat gained
permission to use its "cash on hand" and access a credit line to
run its horse-racing operation, the Bloomberg report quoted
Michael Sirota, an attorney for Zayat, as saying. Zayat must file
a plan of reorganization by April 16.
About Zayat Stables
Hackensack, New Jersey-based Zayat Stables owns of 203
thoroughbred horses. The horses, which are collateral for the
bank loan, are worth $37 million, according an appraisal mentioned
in a court paper. Ahmed Zayat said in a court filing that he
personally invested $40 million in the business.
The Company filed for Chapter 11 bankruptcy protection on
February 3, 2010 (Bankr. D. N.J. Case No. 10-13130). The Company
listed $10,000,001 to $50,000,000 in assets and $10,000,001 to
$50,000,000 in liabilities.
ZAYO GROUP: Moody's Assigns Corporate Family Rating at 'B2'
-----------------------------------------------------------
Moody's Investors Service assigned a B2 corporate family rating
and a B2 probability of default rating for Zayo Group, LLC. The
ratings agency also assigned a B2 (LGD3-49%) rating to the
company's $225 million senior secured notes. In addition, the
company also has a $75 million senior secured revolving credit
facility, which Moody's does not rate. The company plans to use
the borrowings to refinance existing debt, which Moody's does not
rate, and for general corporate purposes. The rating outlook is
stable.
Issuer: Zayo Group, LLC
* Corporate Family Rating -- Assigned B2
* Probability of Default Rating -- Assigned B2
* Senior Secured Notes -- Assigned B2, LGD3 -49%
* Outlook - Stable
Zayo's B2 corporate family rating reflects the company's deep
fiber network in its markets that have helped drive strong revenue
growth in a difficult operating and liquidity-strapped environment
for traditional competitive telecommunications carriers. The
company has delivered quarter-over-quarter revenue growth since
2007, while many CLECs are still witnessing revenue declines. In
Moody's view, the resurging demand for the company's wholesale and
enterprise bandwidth services and the stability of the recurring
revenue stream from the company's recently acquired colocation
business supports the rating. However, Moody's is concerned about
the long term sustainability of the revenue growth and the high
upfront capital expenditures needed to drive that growth. As a
result, Moody's expects the company to incur negative free cash
flow over the next several years due to ongoing capital
expenditures. In addition, ratings are tempered by high customer
concentration and small scale in a competitive environment. A
large portion of the company's footprint is in the northeastern
USA, which is the most competitive telecommunications market in
the country, while the company's Midwest operations may be
impacted by regional macroeconomic forces.
The stable outlook is based on Moody's view that the company has
weathered the worst of the macroeconomic pressures in its markets,
and, with adequate liquidity to fund growth, should be able to
capitalize on favorable near-term wholesale bandwidth capacity
trends.
Moody's believes that the company has very good liquidity, as cash
on-hand from the new financing, coupled with full access to its
$75 million revolver, are expected to cover the expected negative
free cash flow over the next four quarters.
This is the first time that Moody's has rated Zayo.
Zayo Group is a US-based broadband infrastructure and collocation
provider. The company's headquarters are located in Louisville,
CO.
* Canadian Bankruptcies Down 8.6% in December
---------------------------------------------
The Office of the Superintendent of Bankruptcy in Canada reported
on March 3 that the total number of insolvencies (bankruptcies and
proposals) in the country decreased by 11.1% in December 2009 from
the previous month. Bankruptcies decreased by 8.6% whereas
proposals decreased by 16.6%.
In comparison with the same month last year, the total number of
insolvencies in December 2009 was 7.2% higher than the total
number of insolvencies in December 2008. Consumer insolvencies
have increased by 8.5% while business insolvencies have decreased
by 15.7%.
For the 12-month period ending December 31, 2009, total
insolvencies increased by 28.6% compared with the 12-month period
ending December 31, 2008. This is entirely due to an increase in
consumer insolvencies.
Business insolvencies for the 12-month period ended Dec. 31, 2009,
fell by 9.6% compared with the 12-month period ending December 31,
2008. A significant reduction in insolvencies in the agriculture,
forestry, fishing and hunting; construction; and transportation
and warehousing sectors contributed to this decrease.
In December, seven Companies' Creditors Arrangement Act
proceedings were filed.
* 14 CCAA Proceedings Commenced in 2009 Fourth Quarter
------------------------------------------------------
The Office of the Superintendent of Bankruptcy in Canada reported
that 14 proceedings under the Companies' Creditors Arrangement Act
were filed in the fourth quarter of 2009. Five of those filers
are publicly traded. Debts of the CCAA applicants total C$6.77
billion and assets are roughly C$6.2 billion.
More statistics is available at:
http://www.ic.gc.ca/eic/site/bsf-osb.nsf/eng/br02368.html
The Companies' Creditors Arrangement Act is a federal law allowing
insolvent corporations that owe their creditors in excess of $5
million to restructure their business and financial affairs. CCAA
proceedings are carried out under supervision of the courts.
* Commercial Bankruptcy Filings Unchanged in February 2010
----------------------------------------------------------
Bill Rochelle at Bloomberg News reports that more than 117,000
bankruptcies were filed in February, the second most on a daily
basis since bankruptcy law changed in October 2005. Citing data
compiled from court records by Automated Access to Court
Electronic Records, Mr. Rochelle said commercial filings were
unchanged from January to February and last month were up only 3%
from the same month in 2009. Filings in Chapter 11, where mostly
larger companies reorganize or liquidate, were down 18% compared
with January and up 1% from February 2009.
* S&P Expects Default Rate to Decline to 5% by December 2010
------------------------------------------------------------
With the economy on a slow path toward recovery, the U.S.
speculative-grade default rate declined only slightly in February
-- to an estimated 10.5% -- said an article published March 3 by
Standard & Poor's, titled "U.S. Credit Metrics Monthly: Default
Rate Drops Nominally In February To An Estimated 10.5% (Premium)."
It was previously at a high of 10.9% at the end of 2009 and again
in January. "The default rate remains at elevated levels,
consistent with its performance as a lagging indicator to the
overall economy," said Diane Vazza, head of Standard & Poor's
Global Fixed Income Research Group. "Nevertheless, credit metrics
in the U.S. are showing indications of strengthening credit
quality, albeit at a cautious pace."
Although the default rate exceeds 10%, far fewer issuers are
defaulting each month. In February, three companies defaulted,
compared with 25 at the same time in 2009. The preliminary
estimate for the U.S. 12-month-trailing speculative-grade default
rate in February is 10.5% (subject to revision), slightly lower
than the 10.9% in both December and January. S&P expects the
speculative-grade default rate to decline to a mean forecast of 5%
by December 2010, but it could reach 6.9% if economic conditions
are worse than we expect.
* Mortgage Delinquencies Continue to Increase
---------------------------------------------
ABI reports that Equifax Inc. reported that more than 8% of
homeowners were behind 30 days or more on their mortgage loans, up
4.4% from December 2009 and 21 percent from last January.
* Donlin Recano Hires Mark Schindel as Director in Chicago Office
-----------------------------------------------------------------
Donlin Recano has hired Mark Schindel as Director. As a seasoned
private equity professional, Mr. Schindel will be responsible for
business development primarily in the Midwest region and will be
based in DRC's Chicago office. Mr. Schindel will report to DRC's
Executive Director, Scott Stuart, Esq.
With a history of financial consulting and knowledge of the debt
markets, Mark brings a broad set of financial analysis and
strategic planning experience to DRC. Mr. Schindel has served as
a principal at American Capital Ltd., where he participated in the
closing of numerous transactions involving the deployment of
senior debt. He also oversaw several portfolio companies, where
he executed corporate strategy at the board level, raised debt
capital and assisted management in analyzing and closing
acquisitions.
A Chicago native, Mr. Schindel received his B.S. in finance from
the University of Illinois and an MBA from the J.L. Kellogg
Graduate School of Management at Northwestern University.
"We are very happy to add Mark to our team. His impressive track
record will make him a great asset to our growth in the Midwest,
an important part of the country for the turnaround community,"
said Lou Recano, Chief Executive Officer of Donlin Recano. "His
extensive experience is suited to help us continue to grow and
drive the company forward."
Donlin Recano -- http://donlinrecano.com-- is a bankruptcy
management consultancy.
* Former AIG Gen. Counsel Anastasia Kelly Joins DLA Piper
---------------------------------------------------------
Anastasia Kelly has joined DLA Piper's Washington, DC office as Of
Counsel. Ms. Kelly most recently served as Vice Chairman at
American International Group, in charge of Legal, Compliance,
Regulatory, Human Resources, Communications, Government Relations
and Public Relations. She began at AIG in 2006 as Executive Vice
President, General Counsel and Senior Regulatory and Compliance
Officer.
While at AIG, Ms. Kelly worked to strengthen the compliance,
regulatory and governance framework of the company and to build a
cohesive team across the corporate functions she supervised.
Under her leadership, AIG's corporate activities became better
positioned to restore the embattled company's financial health.
"We have known and worked closely with Stasia for many years, in a
variety of different contexts. It would be difficult to identify
another lawyer in this country with more complex corporate
governance and board crisis experience, or more character, grit
and determination than Stasia Kelly," said Francis B. Burch, Jr.,
Global Chairman of DLA Piper. "She has a well earned reputation
as the go-to counsel for companies in difficult circumstances and
she will be a tremendous asset for our clients as they navigate
this volatile market and these challenging times."
Ms. Kelly joined AIG as Executive Vice President, General Counsel
and Senior Regulatory and Compliance Officer in 2006, after the
departure of Chairman and CEO Hank Greenberg amid a probe by then
New York State Attorney General Eliot Spitzer. She was brought to
AIG to assist in building a new corporate culture. Following the
financial crisis in 2008, in which AIG received significant
amounts of taxpayer assistance, she was named Vice Chairman in
January 2009.
"Stasia brings a wealth of legal and management experience. She
has dealt with enormous corporate governance challenges during her
career, and her perspective is incredibly valuable in the current
economic environment," said Roger Meltzer, Global Chair of DLA
Piper's Corporate and Finance practice. "Our global platform is
the ideal setting for Stasia to leverage her extensive experience
and return to private legal practice."
Prior to joining AIG, Ms. Kelly served as Executive Vice President
and General Counsel of MCI/WorldCom, where, as a member of the
restructuring team, she helped the company recover from an
accounting scandal, emerge from bankruptcy and position itself for
acquisition by Verizon Communications. Previously, she was Senior
Vice President and General Counsel of Sears, Roebuck and Co.,
managing corporate legal policy and strategy. Ms. Kelly also
served as Senior Vice President, General Counsel and Corporate
Secretary at Fannie Mae from 1995-1998, and had been a partner and
associate at Wilmer, Cutler & Pickering, where she had extensive
exposure to regulatory and compliance issues involving financial
institutions and securities firms. She has served on the boards of
numerous non-profit organizations, with a particular emphasis on
providing legal services to disenfranchised and indigent
populations.
Ms. Kelly received a J.D., magna cum laude, from George Washington
University National Law Center and a B.A., cum laude, from Trinity
University.
The Wall Street Journal's Serena Ng says Ms. Kelly joins DLA Piper
about two months after she resigned over government-imposed pay
curbs and secured more than $3 million in severance. As reported
by the Troubled Company Reporter, U.S. pay czar, Kenneth Feinberg,
in December 2009 capped annual cash salaries for most executives
at $500,000, and Ms. Kelly's pay stood to be reduced
significantly.
About DLA Piper
DLA Piper -- http://www.dlapiper.com/-- has 3,500 lawyers in 29
countries and 67 offices throughout the US, UK, Continental
Europe, Middle East and Asia.
About AIG
Based in New York, American International Group, Inc., is an
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 provide 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 from the U.S. government, and continues to
seek buyers of its assets.
* Chapter 11 Cases with Assets & Liabilities Below $1,000,000
-------------------------------------------------------------
Recent Chapter 11 cases filed with assets and liabilities below
$1,000,000:
In Re AD&E Construction, Inc.
Bankr. N.D. Ala. Case No. 10-80680
Chapter 11 Petition Filed February 23, 2010
See http://bankrupt.com/misc/alnb10-80680.pdf
In Re James Everett & Associates, Inc.
Bankr. Ariz. Case No. 10-04459
Chapter 11 Petition Filed February 23, 2010
See http://bankrupt.com/misc/azb10-04459.pdf
In Re Howell Utility & Excavation, Inc.
Bankr. E.D. Ark. Case No. 10-11150
Chapter 11 Petition Filed February 23, 2010
See http://bankrupt.com/misc/areb10-11150.pdf
In Re Canby Holdings Inc.
Bankr. C.D. Calif. Case No. 10-11988
Chapter 11 Petition Filed February 23, 2010
Filed As Pro Se
In Re Robrich Associates,LLC
Bankr. Conn. Case No. 10-30505
Chapter 11 Petition Filed February 23, 2010
See http://bankrupt.com/misc/ctb10-30505.pdf
In Re Waterbridge 11, LLC
Bankr. M.D. Fla. Case No. 10-03913
Chapter 11 Petition Filed February 23, 2010
See http://bankrupt.com/misc/flmb10-03913.pdf
In Re Dutchman Two, Inc.
Bankr. S.D. Fla. Case No. 10-14359
Chapter 11 Petition Filed February 23, 2010
See http://bankrupt.com/misc/flsb10-14359p.pdf
See http://bankrupt.com/misc/flsb10-14359c.pdf
In Re Timothy Robert Sessoms
Susanne Sessoms
dba All About You Salon
dba All About You Skin Care & Salon
Bankr. S.D. Fla. Case No. 10-14258
Chapter 11 Petition Filed February 23, 2010
See http://bankrupt.com/misc/flsb10-14258.pdf
In Re 601 Ordinance Road, LLC
Bankr. S.D. Iowa Case No. 10-00719
Chapter 11 Petition Filed February 23, 2010
See http://bankrupt.com/misc/iasb10-00719.pdf
In Re Talisman Farm, LLC
Bankr. Md. Case No. 10-13572
Chapter 11 Petition Filed February 23, 2010
See http://bankrupt.com/misc/mdb10-13572.pdf
In Re Jose Romero
Norma Romero
Bankr. Nev. Case No. 10-12809
Chapter 11 Petition Filed February 23, 2010
See http://bankrupt.com/misc/nvb10-12809.pdf
In Re Carefree Properties LLC
Bankr. E.D. N.Y. Case No. 10-71081
Chapter 11 Petition Filed February 23, 2010
Filed As Pro Se
In Re Choilee Cleaners, Inc.
Bankr. E.D. N.Y. Case No. 10-41425
Chapter 11 Petition Filed February 23, 2010
See http://bankrupt.com/misc/nyeb10-41425.pdf
In Re Affordable Enterprises of Westchester, Inc.
dba Affordable Carting
Bankr. S.D. N.Y. Case No. 10-22322
Chapter 11 Petition Filed February 23, 2010
See http://bankrupt.com/misc/nysb10-22322.pdf
In Re The Pan Latin Corp.
dba Pan Latin Cafe.
Bankr. S.D. N.Y. Case No. 10-10931
Chapter 11 Petition Filed February 23, 2010
See http://bankrupt.com/misc/nysb10-10931.pdf
In Re Ramon R. Jimenez Plumey
Maria M Talavera Mora
Bankr. Puerto Rico Case No. 10-01257
Chapter 11 Petition Filed February 23, 2010
See http://bankrupt.com/misc/prb10-01257.pdf
In Re H & H Executive Group Inc.
Bankr. N.D. Ala. Case No. 10-80693
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/alnb10-80693.pdf
In Re Douglas D. Burkett
Bankr. Ariz. Case No. 10-04631
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/azb10-04631.pdf
In Re National Content Liquidators Inc.
Bankr. Ariz. Case No. 10-04772
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/azb10-04772.pdf
In Re Special Carbide Tools, Inc.
Bankr. Ariz. Case No. 10-04801
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/azb10-04801.pdf
In Re Thomas Manning Kelly
Karen Jean Kelly
Bankr. Ariz. Case No. 10-04723
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/azb10-04723.pdf
In Re Hayashi Syndication Holdings, LLC,
a Nevada limited liability corporation
Bankr. C.D. Calif. Case No. 10-16722
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/cacb10-16722.pdf
In Re M.E. Jones, DDS, Inc.
Bankr. C.D. Calif. Case No. 10-12077
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/cacb10-12077.pdf
In Re Miguel Lopez
aka Miguel Arias Lopez
Bankr. C.D. Calif. Case No. 10-12080
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/cacb10-12080.pdf
In Re Ricky Dean Frick
Bankr. C.D. Calif. Case No. 10-12283
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/cacb10-12283.pdf
In Re 901 De Haro, LLC
Bankr. N.D. Calif. Case No. 10-30627
Chapter 11 Petition Filed February 24, 2010
Filed As Pro Se
In Re The Coleman Group, Inc.
Bankr. N.D. Ga. Case No. 10-65273
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/ganb10-65273.pdf
In Re Coin Operated Properties, L.L.C.
Bankr. S.D. Ind. Case No. 10-02061
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/insb10-02061.pdf
In Re Direct Marine Services, LLC
Bankr. E.D. La. Case No. 10-10539
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/laeb10-10539.pdf
In Re Gupta & Chadha, Inc.
ta Spin Cycle
dba Suitland Coin Laundry
Bankr. Md. Case No. 10-13663
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/mdb10-13663.pdf
In Re Attitudes 2, LLC
Bankr. Nev. Case No. 10-12908
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/nvb10-12908.pdf
In Re John Dellavalle
dba Larry Ponderosa, Llc
aka Jack Dellavalle
aka Jack Delladalle
Bankr. Nev. Case No. 10-12834
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/nvb10-12834.pdf
In Re 401 Gilford Avenue, LLC
Bankr. N.H. Case No. 10-10767
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/nhb10-10767.pdf
In Re Leavitt Road, LLC
Bankr. N.H. Case No. 10-10768
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/nhb10-10768.pdf
In Re 304 West 18, LLC
Bankr. S.D. N.Y. Case No. 10-10954
Chapter 11 Petition Filed February 24, 2010
Filed As Pro Se
In Re Manuel Ismael Pena Rodriguez
Bankr. E.D. N.C. Case No. 10-01450
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/nceb10-01450.pdf
In Re Haines Enterprises
Bankr. N.D. Ohio Case No. 10-60614
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/ohnb10-60614.pdf
In Re McClure & McClure, Inc.
Bankr. W.D. Pa. Case No. 10-70180
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/pawb10-70180.pdf
In Re Eternal Life Church and Tree of Life Ministries, Inc.
Bankr. W.D. Tenn. Case No. 10-22060
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/tnwb10-22060.pdf
In Re Charles Thomas Gutierrez
dba Lunchbox Deli, LLC
dba C Thomas Enterprise, LLC
fdba C & N Ulimited
aka Wing Stop Restaurant
Bankr. S.D. Texas Case No. 10-31477
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/txsb10-31477.pdf
In Re Jose M. Hernandez
dba Merced Hernandez
dba 2000 Construction
Sylvia Martinez
Bankr. W.D. Texas Case No. 10-10470
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/txwb10-10470.pdf
In Re David S. Stoltzfus
dba Inc Master Marketers Global
Eleanor Louise Stoltzfus
aka Inc. Master Marketers Global
Bankr. W.D. Va. Case No. 10-50280
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/vawb10-50280.pdf
In Re Sun Furniture, Inc.
Bankr. W.D. Wash. Case No. 10-41288
Chapter 11 Petition Filed February 24, 2010
See http://bankrupt.com/misc/wawb10-41288.pdf
In Re Charles Flores Arocha
Bankr. N.D. Ala. Case No. 10-80727
Chapter 11 Petition Filed February 25, 2010
See http://bankrupt.com/misc/alnb10-80727.pdf
In Re Clyde August Grunow
Sandra Louise Grunow
Bankr. Ariz. Case No. 10-04897
Chapter 11 Petition Filed February 25, 2010
See http://bankrupt.com/misc/azb10-04897.pdf
In Re Ioana Elena Biro
dba Top Quality
dba Bethesda at Maravilla II
Bankr. Ariz. Case No. 10-04921
Chapter 11 Petition Filed February 25, 2010
See http://bankrupt.com/misc/azb10-04921.pdf
In Re PRI Affiliated Services, LLC
dba Auntie Anne's Soft Pretzels
Bankr. Colo. Case No. 10-13723
Chapter 11 Petition Filed February 25, 2010
See http://bankrupt.com/misc/cob10-13723p.pdf
See http://bankrupt.com/misc/cob10-13723c.pdf
In Re Standard Fast Taxx, Inc.
Bankr. S.D. Ga. Case No. 10-60180
Chapter 11 Petition Filed February 25, 2010
See http://bankrupt.com/misc/gasb10-60180.pdf
In Re Elements Industrial LLC
Bankr. N.D. Ill. Case No. 10-07576
Chapter 11 Petition Filed February 25, 2010
See http://bankrupt.com/misc/ilnb10-07576.pdf
In Re Dunn's Maid Service, LLC
dba Molly Maid of Upper Montgomery County
Bankr. Md. Case No. 10-13722
Chapter 11 Petition Filed February 25, 2010
See http://bankrupt.com/misc/mdb10-13722p.pdf
See http://bankrupt.com/misc/mdb10-13722c.pdf
In Re Hickman Timber Incorporated
Bankr. S.D. Miss. Case No. 10-50407
Chapter 11 Petition Filed February 25, 2010
See http://bankrupt.com/misc/mssb10-50407p.pdf
See http://bankrupt.com/misc/mssb10-50407c.pdf
In Re Lowrey A. Hickman
Bankr. S.D. Miss. Case No. 10-50408
Chapter 11 Petition Filed February 25, 2010
See http://bankrupt.com/misc/mssb10-50408p.pdf
See http://bankrupt.com/misc/mssb10-50408c.pdf
In Re Ethan H, LLC, a NJ Limited Liability Company
dba Prime Time Sports Bar & Billards Cafe
Bankr. N.J. Case No. 10-15436
Chapter 11 Petition Filed February 25, 2010
See http://bankrupt.com/misc/njb10-15436.pdf
In Re Shalom Torah Centers, a NJ Non-Profit Corporation
Bankr. N.J. Case No. 10-15444
Chapter 11 Petition Filed February 25, 2010
See http://bankrupt.com/misc/njb10-15444.pdf
In Re Rainbow Transportation Services, Inc.
Bankr. W.D. N.Y. Case No. 10-10655
Chapter 11 Petition Filed February 25, 2010
See http://bankrupt.com/misc/nywb10-10655.pdf
In Re Faith Hope and Love Partnership Services Inc.
Bankr. M.D. Pa. Case No. 10-01472
Chapter 11 Petition Filed February 25, 2010
See http://bankrupt.com/misc/pamb10-01472.pdf
In Re Ryan's Room, Inc.
dba Sudsy's Sports Bar & Grill
fdba Cameron Street Cafe
Bankr. M.D. Pa. Case No. 10-01504
Chapter 11 Petition Filed February 25, 2010
See http://bankrupt.com/misc/pamb10-01504.pdf
In Re David B. Hamilton
Bankr. W.D. Pa. Case No. 10-21152
Chapter 11 Petition Filed February 25, 2010
See http://bankrupt.com/misc/pawb10-21152p.pdf
See http://bankrupt.com/misc/pawb10-21152c.pdf
In Re Westchester Candy Supply, Inc.
Bankr. S.D. N.Y. Case No. 10-22348
Chapter 11 Petition Filed February 25, 2010
See http://bankrupt.com/misc/nysb10-22348.pdf
In Re WeeTeach Academy LLC
Bankr. E.D. Tenn. Case No. 10-11089
Chapter 11 Petition Filed February 25, 2010
See http://bankrupt.com/misc/tneb10-11089p.pdf
See http://bankrupt.com/misc/tneb10-11089c.pdf
In Re Brentwood Group No. 1
Bankr. S.D. Texas Case No. 10-80093
Chapter 11 Petition Filed February 25, 2010
See http://bankrupt.com/misc/txsb10-80093.pdf
In Re North-One Investment Associates LP
aka North One
aka North One Apartments
aka Space Saver Mini Storage
Bankr. W.D. Wash. Case No. 10-41355
Chapter 11 Petition Filed February 25, 2010
Filed As Pro Se
In Re Brian Davis
Bankr. N.D. Ala. Case No. 10-80737
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/alnb10-80737.pdf
In Re Richard Cable
dba Richard Cable Interiors
Bankr. N.D. Ala. Case No. 10-80738
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/alnb10-80738.pdf
In Re Estella Louise Schoenthal
Bankr. W.D. Ark. Case No. 10-70964
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/arwb10-70964.pdf
In Re Charles F. Wheeler, P.A.
Bankr. M.D. Fla. Case No. 10-04494
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/flmb10-04494.pdf
In Re Meister Electronics, LC
Bankr. M.D. Fla. Case No. 10-04388
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/flmb10-04388.pdf
In Re Michael S. David
Olanike F. David
Bankr. M.D. Fla. Case No. 10-01522
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/flmb10-01522p.pdf
See http://bankrupt.com/misc/flmb10-01522c.pdf
In Re 7120 Indian Creek, LLC
Bankr. S.D. Fla. Case No. 10-14974
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/flsb10-14974.pdf
In Re Piazza Navona, LLC
Bankr. S.D. Fla. Case No. 10-14978
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/flsb10-14978.pdf
In Re Kevin Eugene Dixon
aka Kevin E. Dixon
Bankr. N.D. Ga. Case No. 10-65538
Chapter 11 Petition Filed February 26, 2010
Filed As Pro Se
In Re Wayne Gilbert Jones
aka Gilbert Jones
Bankr. S.D. Ga. Case No. 10-60182
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/gasb10-60182.pdf
In Re Bordelon Investments, LLC
Bankr. W.D. La. Case No. 10-50224
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/lawb10-50224.pdf
In Re James E. Williams, Jr.
Penny Kay Williams
Bankr. W.D. La. Case No. 10-80283
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/lawb10-80283.pdf
In Re Cracker Box, LLC
Bankr. W.D. Mich. Case No. 10-02265
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/miwb10-02265.pdf
In Re Charles David Ebert
Eborah Marie Ebert
Bankr. Nev. Case No. 10-13035
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/nvb10-13035.pdf
In Re Jorge Salinas
Marta M. Salinas
Bankr. Nev. Case No. 10-13158
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/nvb10-13158.pdf
In Re Gideon Abraham
Bankr. S.D. N.Y. Case No. 10-10998
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/nysb10-10998.pdf
In Re 851 Restaurant Company, LLC
Bankr. M.D. Pa. Case No. 10-01568
Chapter 11 Petition Filed February 26, 2010
See h http://bankrupt.com/misc/pamb10-01568.pdf
In Re Jeremy D. Dotson
Bankr. E.D. Tenn. Case No. 10-11116
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/tneb10-11116p.pdf
See http://bankrupt.com/misc/tneb10-11116c.pdf
In Re Kenneth G. Wright
Bankr. N.D. Texas Case No. 10-31308
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/txnb10-31308.pdf
In Re Oacer Group, Inc.
dba Force4U
Bankr. N.D. Texas Case No. 10-31287
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/txnb10-31287.pdf
In Re Joseph Domino, III
dba Subway
Debra Williams Domino
dba Subway
Bankr. N.D. Texas Case No. 10-41270
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/txnb10-41270.pdf
In Re M & M Enterprises, Inc.
dba Appalachian Heating & Cooling
fdba Tan World
Bankr. W.D. Va. Case No. 10-70468
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/vawb10-70468p.pdf
See http://bankrupt.com/misc/vawb10-70468c.pdf
In Re Health Advocacy Center, LLC.
Bankr. D.C. Case No. 10-00173
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/dcb10-00173.pdf
In Re RTK Venture, Inc.
dba Winger's
Bankr. W.D. Wash. Case No. 10-41432
Chapter 11 Petition Filed February 26, 2010
See http://bankrupt.com/misc/wawb10-41432.pdf
In Re Henry's Great Alaskan Restaurant, Inc.
Bankr. Alaska Case No. 10-00151
Chapter 11 Petition Filed February 27, 2010
See http://bankrupt.com/misc/akb10-00151.pdf
In Re TP Shop, LLC
Bankr. N.D. Ga. Case No. 10-65706
Chapter 11 Petition Filed February 27, 2010
See http://bankrupt.com/misc/ganb10-65706.pdf
In Re Betty J. Kenner
dba Accents Etc.
Bankr. Neb. Case No. 10-40545
Chapter 11 Petition Filed February 27, 2010
See http://bankrupt.com/misc/neb10-40545.pdf
In Re Colony Properties International II, LLC
Bankr. S.D. Calif. Case No. 10-03361
Chapter 11 Petition Filed February 28, 2010
Filed As Pro Se
In Re L & K Homes, LLC
Bankr. Md. Case No. 10-14055
Chapter 11 Petition Filed February 28, 2010
See http://bankrupt.com/misc/mdb10-14055.pdf
In Re Mulch Express, Ltd.
Bankr. E.D. Mich. Case No. 10-31037
Chapter 11 Petition Filed February 28, 2010
See http://bankrupt.com/misc/mieb10-31037p.pdf
See http://bankrupt.com/misc/mieb10-31037c.pdf
In Re Peter J. Vardoulis
Susan J. Vardoulis
Bankr. W.D. Pa. Case No. 10-21342
Chapter 11 Petition Filed February 28, 2010
See http://bankrupt.com/misc/pawb10-21342.pdf
In Re North West Trucking Association, Inc.
Bankr. Puerto Rico Case No. 10-01567
Chapter 11 Petition Filed February 28, 2010
See http://bankrupt.com/misc/prb10-01567.pdf
In Re T. Autumn Chase, Inc.
Bankr. E.D. Texas Case No. 10-40653
Chapter 11 Petition Filed February 28, 2010
See http://bankrupt.com/misc/txeb10-40653.pdf
In Re Jesse Vaughan, Jr.
Frances Vaughan
aka Fran Vaughan
Bankr. S.D. Texas Case No. 10-31618
Chapter 11 Petition Filed February 28, 2010
See http://bankrupt.com/misc/txsb10-31618.pdf
In Re Ingram Design & Associates, Inc.
Bankr. Ariz. Case No. 10-05267
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/azb10-05267.pdf
In Re United Surgical Associates, L.L.C.
Bankr. Ariz. Case No. 10-05300
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/azb10-05300.pdf
In Re Charles Emelio Janeke
Bankr. C.D. Calif. Case No. 10-12281
Chapter 11 Petition Filed March 1, 2010
Filed As Pro Se
In Re General Business Real Estate Investment Corp.
Bankr. M.D. Fla. Case No. 10-04709
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/flmb10-04709.pdf
In Re General Business Real Estate Investment Corp. of SW/FL
Bankr. M.D. Fla. Case No. 10-04708
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/flmb10-04708.pdf
In Re June Terry Interiors, LLC
Bankr. M.D. Fla. Case No. 10-01589
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/flmb10-01589.pdf
In Re Leverage Plus Properties, LLC
Bankr. N.D. Ga. Case No. 10-66084
Chapter 11 Petition Filed March 1, 2010
Filed As Pro Se
In Re Suwanee Lawrenceville Partners, LLC
Bankr. N.D. Ga. Case No. 10-66199
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/ganb10-66199.pdf
In Re Bones Theatre, LLC
Bankr. N.D. Ind. Case No. 10-10653
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/innb10-10653.pdf
In Re 2 Day's Child Learning Center, Inc.
Bankr. E.D. Mich. Case No. 10-46276
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/mieb10-46276p.pdf
See http://bankrupt.com/misc/mieb10-46276c.pdf
In Re Sackett Brick Company
aka Sackett Brick and Fireplace
Bankr. W.D. Mich. Case No. 10-02489
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/miwb10-02489.pdf
In Re Allman Nevada Enterprises, LLC
Bankr. Nev. Case No. 10-13279
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/nvb10-13279.pdf
In Re Courtyard Plaza At Mesquite, LLC
Bankr. Nev. Case No. 10-13286
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/nvb10-13286p.pdf
See http://bankrupt.com/misc/nvb10-13286c.pdf
In Re Leo Davenport
Glenda Davenport
Bankr. Nev. Case No. 10-13281
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/nvb10-13281.pdf
In Re Four G's Land LLC, a NJ Limited Liability Company
Bankr. N.J. Case No. 10-15770
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/njb10-15770.pdf
In Re Mouneimne Properties LLC
Bankr. S.D. Ohio Case No. 10-52171
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/ohsb10-52171.pdf
In Re Phantom Tours, LLC
Bankr. Ore. Case No. 10-31612
Chapter 11 Petition Filed March 1, 2010
Filed As Pro Se
In Re Eiben & Eiben, Inc.
aka Klein's Flower Shop
Bankr. W.D. Pa. Case No. 10-21369
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/pawb10-21369p.pdf
See http://bankrupt.com/misc/pawb10-21369c.pdf
In Re MK Real Estate Solutions, LLC
Bankr. W.D. Pa. Case No. 10-21355
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/pawb10-21355.pdf
In Re Hawes Equity, LP
dba Delujo Southwind Apartments
Bankr. N.D. Texas. Case No. 10-31549
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/txnb10-31549.pdf
In Re S & S Kim Corporation
Bankr. N.D. Texas. Case No. 10-31536
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/txnb10-31536.pdf
In Re Welcome Inn Corporation
dba Tropicana Inn
Bankr. N.D. Texas. Case No. 10-31506
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/txnb10-31506.pdf
In Re 5262 Staples II, Ltd.
Bankr. S.D. Texas. Case No. 10-20179
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/txsb10-20179.pdf
In Re Big White Boat, Inc.
Bankr. S.D. Texas. Case No. 10-31681
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/txsb10-31681.pdf
In Re C. Thomas Enterprise, LLC
aka Wing Stop Restaurant
Bankr. S.D. Texas. Case No. 10-31661
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/txsb10-31661.pdf
In Re DM Ventures, Inc.
Bankr. S.D. Texas. Case No. 10-31782
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/txsb10-31782.pdf
In Re J&D Investment Properties, Inc.
Bankr. S.D. Texas. Case No. 10-31668
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/txsb10-31668.pdf
In Re Maverick Marine, Inc.
dba FantaSea Yacht Charters
Bankr. S.D. Texas. Case No. 10-31679
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/txsb10-31679.pdf
In Re Mohammed Reza Madanizadeh
Bankr. S.D. Texas. Case No. 10-31817
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/txsb10-31817.pdf
In Re Red Oak 74 Partners, L.P.
Bankr. S.D. Texas. Case No. 10-31739
Chapter 11 Petition Filed March 1, 2010
See http://bankrupt.com/misc/txsb10-31739.pdf
*********
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. Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Howard
C. Tolentino, 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 2010. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
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