/raid1/www/Hosts/bankrupt/TCR_Public/110725.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, July 25, 2011, Vol. 15, No. 204
Headlines
347 LINDEN: Dist. Ct. Rejects Renewed Bid to Block Foreclosure
AE BIOFUELS: Steven Hutcheson Appointed to Board
ALION SCIENCE: David Ohle Resigns as SVP and Manager
ALLIED IRISH: Reports Tentative Results of Notes Tender Offer
AMERICA WEST: Amends Conversion & Stock Purchase Pact with Denly
AMR CORP: Incurs $286 Million Net Loss in Second Quarter
AMR CORP: Stephen Bennett Appointed to Board of Directors
AMTRUST FINANCIAL: Court Allows Amfin Real to Sell Property
APPLIED DNA: Partners with Martin Against Products Counterfeiting
ASTORIA GENERATING: S&P Cuts Rating on $430MM Term Loan to CCC+
AZ CHEM: S&P Raises Corp. Credit Rating to 'B+'; Outlook Stable
BANK OF CHOICE: Closed; Bank Midwest N.A. Assumes All Deposits
BANK OF IRELAND: DBRS Lowers Subordinated Debt Rating to 'D'
BARZEL INDUSTRIES: Files Amended Joint Plan of Liquidation
BERNARD L MADOFF: Judge Criticizes $62.5-Mil. HSBC Settlement Deal
BONDS.COM GROUP: Awards Stock Options to Officers and Directors
BRICOLAGE CAPITAL: Ernst & Young to Face Tax Shelter Case
CARLISLE APARTMENTS: Can Obtain $28.5-Mil. in DIP Loans from NXT
CARLISLE APARTMENTS: Exclusive Filing Period Extended to Aug. 5
CIRCLE ENTERTAINMENT: Six Directors Elected at Annual Meeting
CONTESSA PREMIUM: Closes Sale to Sun Capital Partners
COSTA DORADA: Meeting of Creditors Continued Until Aug. 3
COSTA DORADA: Court OKs Lugo Mender & Co. as Legal Representative
COUNTRYWIDE FIN'L: Borrowers to Get $108 Million in Refunds
CROSS BORDER: Hires Rodman & Renshaw as Financial Advisor
CROWN MEDIA: S&P Assigns 'B' Corp. Credit Rating; Outlook Stable
DAVE & BUSTERS: S&P Puts 'B-' Credit Rating on Watch Positive
DEB SHOPS: U.S. Trustee Names 5-Member Creditors Committee
DEB SHOPS: Court OKs Employment of Richards Layton as Co-Counsel
DENNY'S CORPORATION: Donald Shepherd to Retire from Board
DEX MEDIA EAST: Bank Debt Trades at 27% Off in Secondary Market
DEX MEDIA WEST: Bank Debt Trades at 17% Off in Secondary Market
DIAMOND RANCH: Victor Petrone Resigns from All Positions
DK AGGREGATES: Plan Outline Hearing Rescheduled Until Sept. 1
DK AGGREGATES: To Hire H. Kenneth Lefoldt, Jr. as Accountant
DOLLAR GENERAL: S&P Raises Corporate Credit Rating to 'BB+'
DOUBLE G ARROWHEAD: Ruling Vacated in VCC Prepayment Clause Issue
DSI HOLDINGS: Taps Rothschild Inc. as Exclusive Financial Advisor
DSI HOLDINGS: Meeting of Creditors Scheduled for Aug. 2
DYNACAST INT'L: S&P Assigns 'B' Corporate Credit Rating
EASTMAN KODAK: Exploring Strategic Options for Digital Imaging
ENERTECK CORP: Inks $4 Million Investment Agreement with Kodiak
FAIRFIELD SENTRY: Two Greenwich Affiliates File Chapter 11 Plans
FAIRWAY COMMONS II: Roseville Wants Receiver Excused from Turnover
FENTON SUB: Wells Fargo Wants Request to Access Cash Denied
FIGUEROA TOWER: Asks to Tap Lenders' Cash to Fund Operations
FIRST FEDERAL: Reincorporates to State of Arkansas
FIRST MARINER: To Appeal NASDAQ's Delisting Determination
FLEXERA SOFTWARE: S&P Puts 'B+' Corp. Rating on Watch Negative
FRED LEIGHTON: Former Owner Gets 6 Years for $20-Mil. Fraud
FUSION TELECOMMUNICATIONS: Borrows $100,000 from Marvin Rosen
GATEHOUSE MEDIA: Bank Debt Trades at 65% Off in Secondary Market
GENTIVA HEALTH: Bank Debt Trades at 0.9% Off in Secondary Market
GENWORTH MORTGAGE: S&P Cuts Counterparty Credit Rating to 'BB-'
GIBRALTAR INDUSTRIES: Moody's Affirms 'B1' CFR; Outlook Stable
GLOBAL DIVERSIFIED: Deregisters Unsold Securities
GOLDEN ELEPHANT: Reports $37,500 Net Income in Sept. 30 Quarter
GORDON PROPERTIES: Court Rules on Condo Owners' Claim
GSC GROUP: Judge Won't Speed Up Challenge to $235 Million Sale
GUIDED THERAPEUTICS: Inks Preliminary Research Pact with Konica
GULFSTREAM INT'L: Creditors File Chapter 11 Plan
HARDAGE HOTELS: Unable to Confirm Any Plan; Ch. 11 Case Dismissed
HAWKER BEECHCRAFT: Bank Debt Trades at 17% Off in Secondary Market
HELLER EHRMAN: Reaches $5-Mil. Deal With Covington Over Transfers
HORIZON LINES: Extends Subscription Deadline to Aug. 5
INTERNATIONAL ENERGY: Wants Until Aug. 28 to File Ch. 11 Plan
INTERNATIONAL ENERGY: Creditors Meeting Rescheduled Until Sept. 1
LA PALOMA: S&P Assigns Prelim. 'B' Rating on Term Loan Facility
LAKE PLEASANT: All Creditors to Be Paid in Full Under Plan
LANDMARK BANK: Closed; American Momentum Bank Assumes All Deposits
LINDEN PONDS: Receives Approval to Tap $6 Million DIP Loan
LOS ANGELES DODGERS: Judge Ejects $150 Million DIP Financing Plan
MALIBU ASSOCIATES: Can Use Bank's Cash Collateral Until Sept. 30
MAQ MANAGEMENT: Wants Order Dismissing Chapter 11 Cases Vacated
MAQ MANAGEMENT: BB&T and 1st Nat'l. Objects to Cash Collateral Use
MAQ MANAGEMENT: Files Schedules of Assets and Liabilities
MARONDA HOMES: Can Use Cash Collateral Until Aug. 31
MARONDA HOMES: Has Final Authority to Pay Critical Vendor Claims
MEDICURE INC: Eric Johnstone Resigns as Chief Financial Officer
MEDICURE INC: Settles $32.8 Million Birmingham Debt
MEDICURE INC: Grants 12.5 Million Stock Options to CEO, et al.
MERIT GROUP: Files Chapter 11 Plan of Liquidation
METAL STORM: PricewaterhouseCoopers Raises Going Concern Doubt
MFJT LLC: Has Until Sept. 30 to Propose Reorganization Plan
MGM RESORTS: Amends to Borgata Settlement Agreement
NALCO CO: S&P Puts 'BB-' Corp. Credit Rating on Watch Positive
NANA DEVELOPMENT: S&P Assigns Prelim. 'BB' Issue-Level Rating
NAVISTAR INT'L: Inks-1 Year Renewal Pact for $500-Mil. Facility
NEBRASKA BOOK: Wins Court Approval For $200-Mil. DIP Financing
NEXITY FINANCIAL: Case Converted to Chapter 7 Liquidation
NEXITY FINANCIAL: Files Schedules of Assets and Liabilities
NEXSTAR FINANCE: Moody's 'B3' Corporate Unaffected by New Plans
NO FEAR: U.K. Sports Retailer Wins Auction for No Brand
OPEN SOLUTIONS: Bank Debt Trades at 13% Off in Secondary Market
OPTI CANADA: Enters Into Arrangement Agreement with CNOOC Limited
PAUL TRANSPORTATION: Lyle Nelson Appointed as Liquidating Trustee
PETSMART INC: S&P Affirms Corporate Credit Rating at 'BB'
PHILLIPS RENTAL: Parties-in-interest Want Plan Outline Disapproved
PLATINUM PROPERTIES: Final Stipulation for Cash Use Approved
PLATINUM PROPERTIES: Can Sell Assets to Indiana Bank for $4-Mil.
POST STREET: Taps Stutman Treister as Reorganization Counsel
POST STREET: LZSH to Handle Disputes with PIL/Eurohypo, et al.
POST STREET: Taps Nossaman LLP as PIL/Eurohypo Litigation Counsel
POTTERS HOLDINGS: S&P Assigns 'B' Corporate Credit Rating
PRM SMITH: Disclosure Statement Hearing Set for June 23
QUALITY DISTRIBUTION: Amends $35 Million Securities Offering
QUEBEC LP: S&P Assigns Preliminary 'B' Corporate Credit Rating
QUEPASA CORP: Inks Pact to Acquire myYearbook for $100 Million
QUEPASA CORP: Mexicans & Americans Discloses 18.3% Equity Stake
RCLC INC: Consulting Actuaries OK's to Prepare Final Form 5500
RCLC INC: Plan Confirmation Hearing Adjourned to Aug. 11
REAL MEX: Moody's Downgrades Corporate Family Rating to 'Ca'
REAL MEX: S&P Cuts Corp. Credit Rating to 'D' on Missed Payment
REYNOLDS GROUP: S&P Assigns 'BB-' Issue Debt Rating to Sr. Notes
SEAVIEW PLACE: Has Until Today to File Chapter 11 Plan
SENSIVIDA MEDICAL: Posts $374,600 Net Loss in May 31 Quarter
SENSIVIDA MEDICAL: Incurs $374,592 Net Loss in May 31 Quarter
SIRIUS XM: David Frear to Continue to Serve as EVP and CFO
SKINNY NUTRITIONAL: Receives $2.17MM from Common Stock Offering
SOUTHSHORE COMMUNITY: Closed; American Momentum Assumes Deposits
SUN COUNTRY: Finds Buyer After Scandal, Bankruptcy
SUNBRIDGE CAPITAL: Avoidance Suit v. Gulf City Stays in Bankr. Ct.
TAYLOR BEAN: $1.6 Billion Deal Overcomes Freddie Mac Protest
TELKONET INC: To Offer 10MM Shares Under Stock Option Plan
TEMPEL STEEL: S&P Assigns Prelim. 'B' Corporate Credit Rating
TEN X CAPITAL: Taps Foster and Smith as Bankruptcy Counsel
TEN X CAPITAL: Meeting of Creditors Scheduled for Aug. 4
TEXAS WYOMING: Trustee Can Sue Ex-Shareholders, 5th Circ. Says
THERMOENERGY CORP: Amends Bridge Loan Agreement with Empire
TRIBUNE CO: Bank Debt Trades at 32% Off in Secondary Market
TRICO MARINE: Can Use Cash Collateral Until May 23
TWIN CITY: Funds in Deferred Compensation Plan Not Part of Estate
US FIDELIS: Committee Files Parkway Property Auction Results
WARNER MUSIC: Completely Acquired by Access Industries
WASHINGTON MUTUAL: Investors Wrap Up Arguments Against Ch. 11 Plan
WATERSCAPE RESORT: Court Confirms Chapter 11 Plan
WHITTLE DEVELOPMENT: Plan Hearing Scheduled for July 29
WHITTLE DEVELOPMENT: Agreement With City Bank Set for Mediation
WHITTLE DEVELOPMENT: Can Access $240,000 Loan on Final Basis
WINGATE AIRPORT: Wants to Borrow $1,883 Monthly to Pay Interest
WOLVERINE TUBE: U.S. Trustee Objects to Plan Confirmation
WORLDCOM INC: Liable for Trespass to Schuyler Hills
WORLDGATE COMMUNICATIONS: Edward Cummings Appointed PFO and PAO
ZAIS INVESTMENT: Noteholders Propose Chap. 11 Plan for Fund
ZESTRA LAB: N.J. Appeals Court Rules on Finder's Fee Suit
* BOND PRICING -- For Week From July 4 - 8, 2011
*********
347 LINDEN: Dist. Ct. Rejects Renewed Bid to Block Foreclosure
--------------------------------------------------------------
On the afternoon of July 18, 2011, 347 Linden LLC brought a second
"Emergency Order to Show Cause with Temporary Restraints" to the
U.S. District Court for the Eastern District of New York,
requesting that it order Federal National Mortgage Association to
show cause why an order should not be entered (1) staying two
March 8, 2011 orders by the U.S. Bankruptcy Court, Eastern
District of New York (Rosenthal, J.) granting relief from a stay
and dismissing 347 Linden's Chapter 11 petition, and (2) staying a
state court foreclosure sale, scheduled for a third time by Fannie
Mae, of the property known as 347 Linden Street, Brooklyn, New
York 11237, Block 3328, Lot 47, for July 21, 2011 at 3:00 p.m.
According to District Judge Kiyo A. Matsumoto, although the debtor
has had notice of the third scheduled pending foreclosure sale for
several weeks, it has, for the second time, brought the
"Emergency" motion to the District Court on the eve of the sale.
Fannie Mae opposes debtor's emergency application.
Judge Matsumoto said he sees no reason why the foreclosure sale
should not proceed as scheduled. "[T]he balance of the equities
clearly favors Fannie Mae, which, without the sale, faces a
continued delay and the uncertainty of protecting its interest in
the value of the Property," Judge Matsumoto said. "[The] Debtor's
argument that a sale will render its appeals moot is itself moot,
as debtor has had the opportunity to fully present its appeals to
this court and has lost its appeals."
Accordingly, the debtor's request for a stay of the bankruptcy
court's orders and of the foreclosure sale is denied, and the
debtor's appeals of the bankruptcy court's March 8, 2011 order
lifting the stay and dismissing the debtor's Chapter 11 proceeding
are denied in their entirety.
A copy of Judge Matsumoto's July 20, 2011 Memorandum & Order is
available at http://tinyurl.com/3c42p47from Leagle.com.
The debtor's first attempt to block foreclosure was reported in
the June 24 edition of the Troubled Company Reporter.
About 347 Linden
347 Linden LLC, in Monroe, New York, filed for Chapter 11
bankruptcy (Bankr. E.D.N.Y. Case No. 10-50413) on Nov. 3, 2010.
Judge Joel B. Rosenthal presides over the case. David Carlebach,
Esq. -- david@carlebachlaw.com -- serves as bankruptcy counsel.
In its petition, the Debtor estimated assets and debts between
$1 million to $10 million. The petition was signed by Abraham
Hoffman, managing member.
The Debtor filed an Amended Disclosure Statement and Amended Plan
of Reorganization on March 7, 2011. The following day, the
Bankruptcy Court granted Fannie Mae's motion requesting relief
from the automatic stay, based on the court's findings that there
was cause for lifting the stay, that there was no equity in the
property, and that an effective reorganization plan was not
possible, and dismissed the Chapter 11 petition.
AE BIOFUELS: Univ. of Maryland's Hutcheson Named to Board
---------------------------------------------------------
The board of directors of AE Biofuels, Inc., appointed Steven W.
Hutcheson, Ph.D., as board member. From 1984 to present, Dr.
Hutcheson served as a Professor for the University of Maryland in
the Department of Molecular and Cell Biology. He also served as
Founder, Chief Executive Officer from 2006-2008 and Chief
Technical Officer of Zymetis, Inc., until its acquisition by AE
Biofuels on July 1, 2011. Dr. Hutcheson received his A.B. in
Biology from the University of California Santa Cruz and his Ph.D.
in Plant Physiology from the University of California Berkeley.
Dr. Hutcheson will also serve as a member of the Governance,
Compensation and Nominating Committee.
In connection with his service as a director and subject to the
Company's director compensation policy, Dr. Hutcheson is eligible
to receive the Company's standard non-employee director cash and
equity compensation. Dr. Hutcheson will receive a pro rata
portion of the $75,000 annual retainer for his service through the
remaining portion of the year ending Dec. 31, 2011, and will
receive fees of $250 per board meeting attended. He will receive
fees of $250 per committee meeting attended. Pursuant to the
Company's director compensation policy, Dr. Hutcheson is eligible
to receive an initial stock option grant of 100,000 shares of the
Company's common stock pursuant to the Company's Amended and
Restated 2007 Stock Plan.
About AE Biofuels
AE Biofuels, Inc. (OTC BB: AEBF) -- http://www.aebiofuels.com/--
is a global vertically integrated biofuels company based in
Cupertino, California, developing sustainable solutions to
address the world's renewable energy needs. The Company is
commercializing its patent-pending next-generation cellulosic
ethanol technology that enables the production of biofuels from
both non-food and traditional feedstocks. Its wholly-owned
Universal Biofuels subsidiary built and operates a nameplate
50 million gallon per year biodiesel production facility on the
east coast of India.
The Company reported a net loss of $1.72 million on $1.59 million
of sales for the three months ended Sept. 30, 2010, compared with
a net loss of $3.78 million on $4.05 million of sales for the same
period a year earlier.
BDO Seidman, LLP, in San Jose, Calif., expressed substantial doubt
about AE Biofuels' ability to continue as a going concern,
following the Company's 2009 results. The independent auditors
noted that the Company has incurred recurring losses, and has a
working capital deficit and total stockholders' deficit as of
December 31, 2009.
The Company's balance sheet at Sept. 30, 2010, showed
$20.23 million in total assets, $29.03 million in total
liabilities, all current, and a stockholders' deficit of
$8.80 million.
ALION SCIENCE: David Ohle Resigns as SVP and Manager
----------------------------------------------------
David Ohle, a named executive officer of Alion Science and
Technology Corporation, has resigned from his positions as Senior
vice president of the Company and manager of the Company's Defense
Operations Integration Sector effective July 25, 2011.
About Alion Science
Alion Science and Technology Corporation, based in McLean,
Virginia, is an employee-owned company that provides scientific
research, development, and engineering services related to
national defense, homeland security, and energy and environmental
analysis. Particular areas of expertise include communications,
wireless technology, netcentric warfare, modeling and simulation,
chemical and biological warfare, program management.
Alion Science reported a net loss of $15.23 million on
$833.98 million of contract revenue for the year ended Sept. 30,
2010, compared with a net loss of $17.04 million on
$802.22 million of contract revenue during the prior year.
The Company's balance sheet at March 31, 2011, showed
$639.23 million in total assets, $731.23 million in total
liabilities, $157.26 million in redeemable common stock, $20.78
million in common stock warrants, $177,000 in accumulated other
comprehensive loss, and a $269.87 million accumulated deficit.
* * *
Alion carries 'Caa3' corporate family and probability of default
Ratings, with stable outlook, from Moody's. Alion carries a 'B-'
corporate credit rating, with stable outlook, from Standard &
Poor's.
Moody's said in March 2010,"The Caa1 corporate family rating
would balance the continued high leverage against a promising
business backlog that could sustain the good 2009 revenue growth
rate, though credit challenges would remain pronounced."
ALLIED IRISH: Reports Tentative Results of Notes Tender Offer
-------------------------------------------------------------
Allied Irish Banks, p.l.c., previously announced that it was
inviting all holders of the Bank's Notes to (i) tender any and all
of the Notes for purchase by the Bank for cash, and (ii) consent
to certain modifications of the terms of the Notes.
The AIB Offer was made upon the terms and subject to the
conditions contained in the tender and consent memorandum.
In conjunction with the invitation to tender any and all of the
Notes, the Bank invited holders of each Series of Notes to
consider, and, if thought fit, pass, the relevant Extraordinary
Resolution in relation to certain modifications of the terms of
each Series of the Notes as further described in the Tender and
Consent Memorandum.
The Bank announced the provisional aggregate nominal amount of
each Series of Notes validly tendered pursuant to the relevant AIB
Offer:
Provisional Aggregate
Nominal Amount of
Notes Description Notes Validly Tendered
----------------- ----------------------
EUR400,000,000 Subordinated Callable
Step-Up Floating Rate Notes due 2015 EUR47,936,000
GBP700,000,000 Callable Dated Subordinated
Fixed to Floating Rate Notes due July 2023 GBP35,350,000
EUR419,070,000 10.75 per cent.
Subordinated Notes due 2017 EUR208,705,000
If the Bank accepts the Notes validly tendered for purchase, the
Bank expects that the tender offer and related consent invitation
launched on May 13, 2011, in respect of eighteen series of
securities issued by the Bank, AIB UK 1 LP, AIB UK 2 LP and AIB UK
3 LP will generate approximately EUR2.0bn of Core Tier 1 capital
following completion of the AIB Offer.
As soon as reasonably practicable after conclusion of the Meetings
on Friday, July 22, 2011, the Bank expects to announce whether (i)
it accepts for purchase Notes validly tendered in the relevant AIB
Offer and the aggregate nominal amount (if any) of Notes of each
Series accepted for purchase, and (ii) the Extraordinary
Resolutions in relation to the Notes have been passed.
Payment of the Purchase Price in respect of Notes validly tendered
in the relevant AIB Offer and accepted for purchase is expected to
be made on July 25, 2011.
About Allied Irish Banks, p.l.c.
Allied Irish Banks, p.l.c. -- http://www.aibgroup.com/-- is a
major commercial bank based in Ireland. It has an extensive
branch network across the country, a head office in Dublin and a
capital markets operation based in the International Financial
Services Centre in Dublin. AIB also has retail and corporate
businesses in the UK, offices in Europe and a subsidiary company
in the Isle of Man and Jersey (Channel Islands).
Since the onset of the global and Irish financial crisis, AIB's
relationship with the Irish Government has changed significantly.
As at Dec. 31, 2010, the Government, through the National Pension
Reserve Fund Commission ("NPRFC"), held 49.9% of the ordinary
shares of the Company (the share of the voting rights at
shareholders' general meetings), 10,489,899,564 convertible non-
voting ("CNV") shares and 3.5 billion 2009 Preference Shares. On
April 8, 2011, the NPRFC converted the total outstanding amount of
CNV shares into 10,489,899,564 ordinary shares of AIB, thereby
increasing its holding to 92.8% of the ordinary share capital.
In addition to its shareholders' interests, the Government's
relationship with AIB is reflected through formal and informal
oversight by the Minister and the Department of Finance and the
Central Bank of Ireland, representation on the Board of Directors
(three non-executive directors are Government nominees),
participation in NAMA, and otherwise.
As reported by the TCR on May 31, 2011, KPMG, in Dublin, Ireland,
noted that there are a number of material economic, political and
market risks and uncertainties that impact the Irish banking
system, including the Company's continued ability to access
funding from the Eurosystem and the Irish Central Bank to meet its
liquidity requirements, that raise substantial doubt about the
Company's ability to continue as a going concern.
The Company reported a net loss of EUR10.16 billion on
EUR1.84 billion of interest income for 2010, compared with a net
loss of EUR2.33 billion on $2.87 billion of interest income for
2009.
The Company's balance sheet at Dec. 31, 2010, showed
EUR145.2 billion in total assets, EUR140.9 billion in total
liabilities, and stockholders' equity of EUR4.3 billion.
AMERICA WEST: Amends Conversion & Stock Purchase Pact with Denly
----------------------------------------------------------------
America West Resources, Inc., and Denly Utah Coal, LLC, entered
into a first amended and restated conversion and stock purchase
agreement whereby (i) the parties acknowledged previous advances
by Denly in the aggregate amount of $2,690,130 to the Company, of
which this principal amount and accrued interest of $11,793 was
converted into 2,701,923 shares of Company stock, (ii) Denly
converted $3,600,000 of existing indebtedness into 3,600,000
shares of common stock, and (iii) Denly agreed to purchase an
additional 298,077 shares of common stock at a purchase price of
$1 per share on or prior to Sept. 30, 2011.
On July 14, 2011, the Company and Denly entered into amendment 2
to the existing loan agreement which amended and restated certain
covenants of the loan agreement.
During July 2011, the Company sold an aggregate of 2,000,000
shares of its common stock in a private placement resulting in
gross proceeds of approximately $2,000,000. The offers and sales
of the 2,000,000 shares of common stock were made without
registration under the Act, and the securities laws of certain
states, in reliance on the exemptions provided by Section 4(2) of
the Act and Regulation D under the Act and in reliance on similar
exemptions under applicable state laws. The Company paid a
registered broker-dealer sales commissions of $260,000 in
connection therewith and issued such registered broker-dealer a
warrant to purchase 200,000 shares at a purchase price of $1.00
per share.
Effective July 14, 2011, John Thomas Bridge and Opportunity Fund,
LP, and John Thomas Bridge and Opportunity Fund, LP II, both
managed by George Jarkesy, Jr., a director of the Company,
converted an aggregate principal amount of $500,000 owed by the
Company into 500,000 shares of Company common stock. The
remaining aggregate principal amount owed by the Company to John
Thomas Bridge and Opportunity Fund, LP, and John Thomas Bridge and
Opportunity Fund, LP II, after giving effect to this conversion,
is $307,321. The Company paid John Thomas Financial, Inc.,
$65,000 in sales commissions with respect to this conversion.
Effective July 14, 2011, the holders of an aggregate of $4,465,000
of short-term indebtedness converted such debt into 4,911,500
shares of Company common stock. The Company paid John Thomas
Financial, Inc., approximately $580,450 in sales commissions with
respect to this conversion.
About America West
Based in Salt Lake City, Utah, America West Resources, Inc., is an
established domestic coal producer engaged in the mining of clean
and compliant (low-sulfur) coal. The majority of the Company's
coal is sold to utility companies for use in the generation of
electricity.
The Company reported a net loss of $16.14 million on
$10.07 million of total revenue for the year ended Dec. 31, 2010,
compared with a net loss of $8.70 million on $11.01 million of
total revenue during the prior year.
As reported by the TCR on April 21, 2011, MaloneBailey, LLP, in
Houston, Texas, expressed substantial doubt about America West's
ability to continue as a going concern, following the 2010
financial results. The independent auditors noted that the
Company has a working capital deficit and has incurred significant
losses.
The Company's balance sheet at March 31, 2011, showed
$28.14 million in total assets, $27.03 million in total
liabilities, and $1.11 million in total stockholders' equity.
AMR CORP: Incurs $286 Million Net Loss in Second Quarter
--------------------------------------------------------
AMR Corporation filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q, reporting a net loss
of $286 million on $6.11 billion of total operating revenues for
the three months ended June 30, 2011, compared with a net loss of
$11 million on $5.67 billion of total operating revenues for the
same period a year ago. The Company also reported a net loss of
$722 million on $11.64 billion of total operating revenues for the
six months ended June 30, 2011, compared with a net loss of
$516 million on $10.74 million of total operating revenues during
the prior year.
The Company's balance sheet at June 30, 2011, showed
$25.78 billion in total assets, $30.29 billion in total
liabilities, and a $4.51 billion stockholders' deficit.
"This past quarter was challenging in many respects," said AMR
Chairman and CEO Gerard Arpey. "We remain acutely focused on
taking the necessary steps to manage through our near-term
challenges while continuing to lay the foundation for long-term
success. We believe we have the right framework under our Flight
Plan 2020 strategy to achieve our long-term objectives for the
benefit of all our stakeholders, and today we took several major
steps forward. I would also like to thank all of our employees
for their efforts to serve our customers, particularly during the
extreme weather conditions and tornadoes in April and May, and for
their hard work and dedication during a very busy summer."
AMR announced landmark agreements with Boeing and Airbus that will
enable it to transform American's narrowbody fleet. These new
aircraft will allow American to reduce its operating and fuel
costs and deliver a broad range of state-of-the-art amenities to
customers, while maximizing the Company's financial flexibility.
Under the new agreements, American will acquire 460 narrowbody
aircraft from the Boeing 737 and Airbus A320 families beginning in
2013 - the largest aircraft order in aviation history. As part of
these agreements, starting in 2017 American will become the first
U.S. network airline to begin taking delivery of "next generation"
narrowbody aircraft that will further accelerate fuel-efficiency
gains.
These new deliveries are expected to pave the way for American to
have the youngest and most fuel-efficient fleet among its U.S.
airline peers in approximately five years. American also will
benefit from approximately $13 billion of committed financing from
the manufacturers through lease transactions that will help
maximize balance sheet flexibility and reduce risk. The financing
fully covers the first 230 deliveries.
In addition, American now has eight Boeing 777-300ERs that are
scheduled for delivery in 2012 and 2013, including three
additional aircraft for which options were recently exercised.
These 777-300ERs will complement American's fleet, offering
additional network flexibility, and providing increased efficiency
due to better seat mile economics and performance characteristics.
Moreover, AMR announced its intent to move forward with the
divestiture of AMR Eagle Holding Corporation. AMR currently
expects the divestiture to take the form of a spin-off of Eagle
stock to the shareholders of AMR. Strategically, AMR believes a
divestiture would be beneficial, as it would help ensure American
maintains competitive rates and services for its regional feed
into the future. A divestiture would also provide Eagle an
opportunity to vie for the business of other mainline carriers and
allow the carrier to expand its operations.
A full-text copy of the Form 10-Q is available for free at:
http://is.gd/vbLsTF
About AMR Corporation
Headquartered in Fort Worth, Texas, AMR Corporation (NYSE:
AMR) operates with its principal subsidiary, American Airlines
Inc. -- http://www.aa.com/-- a worldwide scheduled passenger
airline. As of Dec. 31, 2009, American provided scheduled jet
service to approximately 160 destinations throughout North
America, the Caribbean, Latin America, Europe and Asia.
Its wholly owned subsidiary, AMR Eagle Holding Corp., owns two
regional airlines, American Eagle Airlines Inc. and Executive
Airlines Inc., and does business as "American Eagle." American
Beacon Advisors Inc., a wholly owned subsidiary of AMR, is
responsible for the investment and oversight of assets of AMR's
U.S. employee benefit plans, as well as AMR's short-term
investments.
AMR recorded a net loss of $471 million in the year 2010, a net
loss of $1.5 billion in 2009, and a net loss of $2.1 billion in
2008.
* * *
AMR carries a 'CCC' issuer default rating from Fitch Ratings,
'Caa1' corporate family and probability of default ratings from
Moody's, and a 'B-' corporate credit rating from Standard &
Poor's.
In November 2010, Standard & Poor's Ratings Services revised its
outlook on AMR Corp. and its major operating subsidiary, American
Airlines Inc., to stable from negative, based on AMR's improved
operating performance, which has bolstered credit quality. S&P
also affirmed its 'B-' corporate credit rating and most issue
ratings on the two companies and lowered selected ratings on
American's enhanced equipment trust certificates.
AMR CORP: Stephen Bennett Appointed to Board of Directors
---------------------------------------------------------
AMR Corporation and its wholly-owned subsidiary, American
Airlines, Inc., announced that Stephen M. Bennett was appointed to
the Board of Directors of each company effective July 19, 2011.
Bennett will also serve as a member of the audit committee.
"Steve's extraordinary combination of experience, intellect and
talent will make him an invaluable member of the Board of
Directors of AMR and American Airlines," said Gerard Arpey,
Chairman and CEO of AMR and American Airlines. "We are very
pleased to have someone of his caliber join our company."
Bennett served as President and Chief Executive Officer at Intuit,
Inc., a leader in e-finance, including financial software and Web-
based services, from 2000 until his retirement in 2007. As CEO of
Intuit, Bennett grew the company's business from $900 million to
$2.6 billion in revenue, and the company's earnings more than
quadrupled.
Prior to Intuit, he held several significant leadership positions
at General Electric Company for more than 23 years, including
Executive Vice President and Member of the Board of Directors for
GE Capital, the financial services subsidiary of General Electric
Corp. GE Capital is the world leader in numerous financial
industries, including private label credit cards, commercial
equipment leasing and vendor finance.
Bennett is currently a non-executive director of Qualcomm Inc. and
Symantec Corporation.
"It is a privilege to serve on the boards of AMR and American
Airlines, which have a long and proud history," Bennett said. "I
look forward to contributing to their long-term success."
About AMR Corporation
Headquartered in Fort Worth, Texas, AMR Corporation (NYSE:
AMR) operates with its principal subsidiary, American Airlines
Inc. -- http://www.aa.com/-- a worldwide scheduled passenger
airline. As of Dec. 31, 2009, American provided scheduled jet
service to approximately 160 destinations throughout North
America, the Caribbean, Latin America, Europe and Asia.
Its wholly owned subsidiary, AMR Eagle Holding Corp., owns two
regional airlines, American Eagle Airlines Inc. and Executive
Airlines Inc., and does business as "American Eagle." American
Beacon Advisors Inc., a wholly owned subsidiary of AMR, is
responsible for the investment and oversight of assets of AMR's
U.S. employee benefit plans, as well as AMR's short-term
investments.
The Company's balance sheet at March 31, 2011, showed
$27.11 billion in total assets, $31.06 billion in total
liabilities, and a $3.95 billion stockholders' deficit.
AMR recorded a net loss of $471 million in the year 2010, a net
loss of $1.5 billion in 2009, and a net loss of $2.1 billion in
2008.
* * *
AMR carries a 'CCC' issuer default rating from Fitch Ratings,
'Caa1' corporate family and probability of default ratings from
Moody's, and a 'B-' corporate credit rating from Standard &
Poor's.
In November 2010, Standard & Poor's Ratings Services revised its
outlook on AMR Corp. and its major operating subsidiary, American
Airlines Inc., to stable from negative, based on AMR's improved
operating performance, which has bolstered credit quality. S&P
also affirmed its 'B-' corporate credit rating and most issue
ratings on the two companies and lowered selected ratings on
American's enhanced equipment trust certificates.
AMTRUST FINANCIAL: Court Allows Amfin Real to Sell Property
-----------------------------------------------------------
BankruptcyData.com reports that the U.S. Bankruptcy Court approved
AmTrust Financial's motion for an order (a) authorizing AmFin Real
Estate Investments to sell property free and clear of liens,
claims and encumbrances, (b) waiving the Rule 6004(h) 14-day stay
and (c) waiving the Local Bankruptcy Rule 9013-2 memorandum
requirement. Harbor Group International had entered into a
$7.5 million asset purchase agreement for the assets.
According to Law360, documents filed with the Court explain that
the Company subsequently received a competing qualified bid.
Harbor Group International subsequently submitted a winning bid,
and the ultimate purchase price for the assets was $8,150,000.
About AmTrust Financial
AmTrust Financial Corp (PINK: AFNL) was the owner of the AmTrust
Bank. AmTrust was the seventh-largest holder of deposits in South
Florida, with $4.7 billion in deposits and 21 branches.
In November 2008, the Office of Thrift Supervision issued a cease
and desist order requiring AmTrust to improve its capital ratios.
AmTrust Financial, together with affiliates that include AmTrust
Management Inc., filed for Chapter 11 bankruptcy protection
(Bankr. N.D. Ohio Case No. 09-21323) on Nov. 30, 2009. The debtor
subsidiaries include AmFin Real Estate Investments, Inc., formerly
AmTrust Real Estate Investments, Inc. (Case No. 09-21328).
G. Christopher Meyer, Esq., Christine M. Piepont, Esq., and Sherri
L. Dahl, Esq., at Squire Sanders & Dempsey (US) LLP, in Cleveland,
Ohio; and Stephen D. Lerner, Esq., at Squire Sanders & Dempsey
(US) LLP, in Cincinnati, Ohio, serve as counsel to the Debtors.
Kurtzman Carson Consultants serves as claims and notice agent.
Attorneys at Hahn Loeser & Parks LLP serve as counsel to the
Official Committee of Unsecured Creditors. AmTrust Management
estimated $100 million to $500 million in assets and liabilities
in its Chapter 11 petition.
AmTrust Bank was not part of the Chapter 11 filings. On Dec. 4,
2009, AmTrust Bank was closed by regulators and the Federal
Deposit Insurance Corporation was named receiver. New York
Community Bank, in Westbury, New York, assumed all of the deposits
of AmTrust Bank pursuant to a deal with the FDIC.
APPLIED DNA: Partners with Martin Against Products Counterfeiting
-----------------------------------------------------------------
C.F. Martin & Co. announced that it has partnered with Applied DNA
Sciences to protect products, brands and intellectual property
from counterfeiting and diversion. As a result, according to both
companies, Martin's customers will be protected by the "gold
standard" in forensic anti-counterfeiting systems.
"People around the world know the high level of quality that is
inherent in each and every guitar that features the C. F. Martin
logo, and protecting our intellectual property is of vital
importance, as we face new counterfeit-related challenges at home
and abroad," said Chris (C. F.) Martin IV, the sixth-generation
Martin to serve as company chairman and CEO.
The two companies plan to announce further details about the
partnership, including timing of implementation, later this year.
"Martin Guitar has earned an unparalleled reputation for product
integrity and a commitment to exceptional quality. Our SigNature
DNA technology will be instrumental in providing Martin Guitar
with protection against global counterfeiting threats which
ultimately protects Martin and its worldwide consumer group,"
stated APDN Chairman, President and CEO Dr. James A. Hayward.
Applied DNA Sciences has a reputation globally for its advanced
product verification systems, protecting products as diverse as
English wool, Mexican police uniforms, world-famous luxury goods,
and, in a pilot for the U.S Department of Defense, microchips
bound for the U.S military.
About Applied DNA
Stony Brook, N.Y.-based Applied DNA Sciences, Inc., is principally
devoted to developing DNA embedded biotechnology security
solutions in the United States.
As reported in the Troubled Company Reporter on Dec. 21, 2010,
RBSM LLP, in New York, expressed substantial doubt about Applied
DNA Sciences' ability to continue as a going concern, after
auditing the Company's financial statements for fiscal year ended
Sept. 30, 2010. The independent auditors noted that the Company
has suffered recurring losses and does not have significant cash
or other material assets, nor does it have an established source
of revenues sufficient to cover its operations.
The Company reported a net loss of $7.91 million on $519,844 of
sales for fiscal 2010, compared with net income of $3.94 million
on $295,162 of sales for fiscal 2009.
The Company's balance sheet at March 31, 2011, showed
$1.23 million in total assets, $3.36 million in total liabilities,
all current, and a $2.12 million total stockholders' deficiency.
ASTORIA GENERATING: S&P Cuts Rating on $430MM Term Loan to CCC+
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on Astoria
Generating Co. Acquisitions LLC's $430 million ($141 million
outstanding) first-lien term loan due 2013 and its $100 million
first-lien working capital facility due 2012 to 'CCC+' from 'BB-'.
"We also lowered our rating on the $300 million ($300
million outstanding) second-lien term bank loan due 2013 to 'CCC-'
from 'B'. We revised the CreditWatch implications on the ratings
to developing from negative," S&P related.
The recovery rating of '1' on first lien credit facilities is
unchanged, indicating that lenders can expect a very high (90% to
100%) recovery of their principal in a default scenario. "We
changed the recovery rating on the second-lien credit facility '5'
from '3', indicating that lenders can expect a modest recovery
(10% to 30%) if a payment default occurs," S&P stated.
The July 2011 capacity auction for New York zone 'J' resulted in a
capacity price of $5.76 per kilowatt (kW)-month, about 50% lower
compared with the clearing price of $11.76 per kW-month in the
previous auction for June 2011. The marked decline is likely due
to the addition of 550 megawatts (MW) of capacity at the Astoria
II LLC power plant, which began operations in July 2011. The
auction result also indicates that Astoria II might not have been
mitigated under NYISO's buyer-side mitigation rules.
The disagreement among stakeholders in the market over whether or
not the rules have mitigated certain assets has heightened as
reflected in the July 11 filing to the FERC by Astoria Generating
Co. L.P. and TC Ravenswood LLC. The previous filing on June 3 by
generators that included Astoria Gen and TC Ravenswood was more
general in nature and challenged NYISO's overall implementation of
buyer-side mitigation rules. However, the recent filing directly
challenges the NYISO's application of buyer-side mitigation rules
on Astoria II and potentially, other new units including Bayonne
Energy Center (Bayonne) which they assume to be not mitigated by
the NYISO. The assumptions are based on the July auction results
and the statement made by Bayonne about its mitigation in its
protest filing. The filing requested an expedited response. They
also requested FERC to immediately issue an order requiring
Astoria II be mitigated, starting with August 2011 auction, to 75%
of mitigation of net cost of new entry, subject to refund.
"However, the FERC stated that it will conduct in the normal 20-
day comment period that ends August 3, after the August auction on
July 25. As such, we believe the capacity prices for August 2011
will be similar to that of the July auction," said Standard &
Poor's credit analyst Trevor D'Olier-Lees.
"The CreditWatch with developing implication reflects the
heightened uncertainty regarding future capacity prices in New
York zone J and that we may upgrade or downgrade the rating based
on the ultimate outcome of the proceeding with the FERC, which is
expected after August 3. If the FERC rules in the project's favor,
we could raise the ratings. We may downgrade the rating if the
opposite occurs," S&P said.
AZ CHEM: S&P Raises Corp. Credit Rating to 'B+'; Outlook Stable
---------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
ratings on Jacksonville, Fla.-based AZ Chem U.S. and on the
intermediate parent company, AZ Chem Intermediate Inc., to 'B+'
from 'B'. (AZ Chem U.S.'s current parent, Arizona Chem Sweden
Holdings AB, expects to merge into AZ Chem Intermediate Inc. by
March 31, 2012.) The outlook is stable.
"The company has achieved strong growth in operating performance
primarily due to its ability to increase pricing," said Standard &
Poor's credit analyst Seamus Ryan. "In addition, during 2011, AZ
Chem has undertaken meaningful debt reduction, which we expect to
support an improved financial profile."
At the same time, Standard & Poor's raised its issue-level ratings
on AZ Chem U.S.'s $60 million first-lien senior secured revolving
credit facility due 2015 and $430 million term loan due 2016,
which the company has partially repaid over the past two quarters,
to 'BB' (two notches above the 'B+' corporate credit rating) from
'B+'. Standard & Poor's revised the recovery rating to '1',
indicating the expectation for very high recovery (90%-100%) in
the event of a payment default, from '2'.
The ratings on AZ Chem U.S. and AZ Chem Intermediate (AZ Chem,
collectively) reflect the company's concentration in a niche
market for specialty pine-based chemicals and its very aggressive
financial policies. "But they also reflect our expectations that
favorable industry conditions should support the current financial
profile and that shareholder rewards will not increase debt
leverage beyond what we consider appropriate at the current
rating," Mr. Ryan said. Standard & Poor's characterizes AZ Chem's
business risk profile as weak and its financial risk profile as
aggressive.
"Our assessment of the company's financial risk profile
incorporates our view of the risks related to its financial
policy," Mr. Ryan said. "The limited track record of financial
policy under the new ownership and the potential for higher
leverage due to shareholder-friendly actions are primary risk
factors."
Privately held company AZ Chem, along with its operating
subsidiaries, is the largest global producer of pine-based
chemicals, which are used in adhesives, inks and coatings,
lubricants, fuel additives, and other applications. Major
end users include the packaging and bookbinding market and inks
and coatings manufacturers.
BANK OF CHOICE: Closed; Bank Midwest N.A. Assumes All Deposits
--------------------------------------------------------------
Bank of Choice of Greeley, Colo., was closed on Friday, July 22,
2011, by the Colorado Division of Banking, which appointed the
Federal Deposit Insurance Corporation as receiver. To protect the
depositors, the FDIC entered into a purchase and assumption
agreement with Bank Midwest, National Association, of Kansas City,
Mo., to assume all of the deposits of Bank of Choice.
The 17 branches of Bank of Choice will reopen during their normal
business hours as branches of Bank Midwest, N.A. Depositors of
Bank of Choice will automatically become depositors of Bank
Midwest, N.A. Deposits will continue to be insured by the FDIC,
so there is no need for customers to change their banking
relationship in order to retain their deposit insurance coverage
up to applicable limits. Customers of Bank of Choice should
continue to use their existing branch until they receive notice
from Bank Midwest, N.A., that it has completed systems changes to
allow other Bank Midwest, N.A., branches to process their accounts
as well.
As of March 31, 2011, Bank of Choice had around $1.07 billion in
total assets and $924.9 million in total deposits. In addition to
assuming all of the deposits, Bank Midwest, N.A., agreed to
purchase around $853.0 million of the failed bank's assets.
Customers with questions about the transaction should call the
FDIC toll-free at 1-800-887-7340. Interested parties also can
visit the FDIC's Web site at
http://www.fdic.gov/bank/individual/failed/bankofchoice.html
As part of this transaction, the FDIC will acquire a value
appreciation instrument. This instrument serves as additional
consideration for the transaction.
The FDIC estimates that the cost to the Deposit Insurance Fund
will be $213.6 million. Compared to other alternatives, Bank
Midwest, N.A.'s acquisition was the least costly resolution for
the FDIC's DIF. Bank of Choice is the 58th FDIC-insured
institution to fail in the nation this year, and the fifth in
Colorado. The last FDIC-insured institution closed in the state
was Signature Bank, Windsor, on July 8, 2011.
BANK OF IRELAND: DBRS Lowers Subordinated Debt Rating to 'D'
------------------------------------------------------------
DBRS Inc. has downgraded the ratings of certain subordinated debt
issued by The Governor and Company of the Bank of Ireland to "D"
from "C". The downgrade follows the execution of the Group's note
exchange offer.
Almost all of these instruments have been extinguished. The
default status for the exchanged or purchased and now-extinguished
notes reflect DBRS's view that bondholders were offered limited
options, which is considered a default under DBRS policy, as
discussed in DBRS's press release dated 13 June 2011.
However, the holders of the Dated Subordinated Notes due Sept 2015
(ISIN CA062786AA67) issued by Bank of Ireland have until 8 August
2011 to tender their notes and vote on the extraordinary
resolutions as put forth by the Bank of Ireland. As such, the
rating of this security remains at "C", Under Review with Negative
Implications, where they were placed on 1 October 2010, pending
the finalisation of the exchange results. Previously, DBRS
maintained one rating on its website for all Dated Subordinated
Debt issued by the Bank of Ireland. To reflect that this security
remains outstanding, DBRS has individually listed this security on
its website.
Moreover, holders of certain subordinated instruments of the Bank
of Ireland rejected the proposed extraordinary resolutions
included in the exchange offer; as such, the ratings of these
instruments will remain at "C", Under Review with Negative
Implications, where they were placed on 1 October 2010. Similar
to the aforementioned notes, to reflect the results of the
exchange offer, DBRS has individually listed each subordinate bond
that remains outstanding on its website.
BARZEL INDUSTRIES: Files Amended Joint Plan of Liquidation
----------------------------------------------------------
BankruptcyData.com reports that Barzel Industries filed with the
U.S. Bankruptcy Court an Amended Joint Plan of Liquidation and
related Disclosure Statement.
According to the Disclosure Statement, "The Debtors are proposing
the Plan over the alternative of converting the Debtors'
bankruptcy cases to Chapter 7 of the Bankruptcy Code because the
Debtors believe that (i) the Plan provides a more orderly
liquidation and a greater recovery to creditors than a Chapter 7
liquidation, and (ii) the Plan provides unnecessary costs to the
Debtors' estates which would accrue should the Debtors' bankruptcy
cases be converted to Chapter 7 of the Bankruptcy Code."
Under the Plan, administrative claims, priority tax and non tax
claims, class 1 miscellaneous secured claims, and class 3 priority
non-tax claims are estimated to receive 100% recovery.
About Barzel Industries
Norwood, Massachusetts-based Barzel Industries, Inc., was in the
business of processing and distributing steel. The Company
manufactured steel for the construction and industrial
manufacturing industries, and produces finished commercial racking
products.
Barzel Industries -- aka Novamerican Steel Inc. and Symmetry
Holdings Inc. -- and seven affiliates filed for Chapter 11
protection (Bankr. D. Del. Case No. 09-13204) on Sept. 15, 2009.
Judge Christopher S. Sontchi presides over the cases. J. Kate
Stickles, Esq., and Patrick J. Reilley, Esq., at Cole, Schotz,
Meisel, Forman & Leonard, P.A., in Wilmington, Delaware, and
Gerald H. Gline, Esq., at Cole, Schotz, Meisel, Forman & Leonard,
P.A., in Hackensack, N.J., serve as the Debtors' counsel.
On the same day, Barzel Industries filed applications for relief
under the Canadian Companies' Creditors Arrangement Act in the
Ontario Superior Court of Justice -- Commercial List.
Barzel Industries recorded assets of $370,145,000 against debts of
$375,412,000 as of May 30, 2009.
Barzel sold most of the assets in November 2009 for $75 million to
Norwood, Massachusetts-based Chriscott USA Inc. Secured lenders
agreed to a settlement later where they received a release of
claims in return for giving up $800,000.
BERNARD L MADOFF: Judge Criticizes $62.5-Mil. HSBC Settlement Deal
------------------------------------------------------------------
Christie Smythe at Bankruptcy Law360 reports that New York Federal
Judge Richard M. Berman on Thursday criticized parts of HSBC
Holdings PLC's proposed $62.5 million settlement of a class action
brought by Irish feeder fund investors who lost money in Bernard
L. Madoff's Ponzi scheme.
Law360 relates that Judge Berman took issue with a proposed $10
million "war chest" included in the deal that would allow lead
plaintiff Neville Seymour Davis to pursue litigation against other
defendants, including Bank Medici AG and its Austrian chief, Sonja
Kohn.
About Bernard L. Madoff
Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff
orchestrated the largest Ponzi scheme in history, with losses
topping $50 billion. On Dec. 15, 2008, the Honorable Louis A.
Stanton of the U.S. District Court for the Southern District of
New York granted the application of the Securities Investor
Protection Corporation for a decree adjudicating that the
customers of BLMIS are in need of the protection afforded by the
Securities Investor Protection Act of 1970. The District Court's
Protective Order (i) appointed Irving H. Picard, Esq., as trustee
for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP
as his counsel, and (iii) removed the SIPA Liquidation proceeding
to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789)
(Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims
agent.
On April 13, 2009, former BLMIS clients filed an involuntary
Chapter 7 bankruptcy petition against Bernard Madoff (Bankr.
S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The
petitioning creditors -- Blumenthal & Associates Florida General
Partnership, Martin Rappaport Charitable Remainder Unitrust,
Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert
US$64 million in claims against Mr. Madoff based on the balances
contained in the last statements they got from BLMIS.
On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff
Securities International Limited in London under bankruptcy
protection pursuant to Chapter 15 of the U.S. Bankruptcy Code
(Bankr. S.D. Fla. 09-16751).
The Chapter 15 case was later transferred to Manhattan. In June
2009, Judge Lifland approved the consolidation of the Madoff SIPA
proceedings and the bankruptcy case.
Judge Denny Chin of the U.S. District Court for the Southern
District of New York on June 29, 2009, sentenced Mr. Madoff to
150 years of life imprisonment for defrauding investors in United
States v. Madoff, No. 09-CR-213 (S.D.N.Y.)
As of July 15, 2011, a total of $6.88 billion in claims by
investors has been allowed, with $794.9 million to be paid by the
Securities Investor Protection Corp. Investors are expected to
receive additional distributions from money recovered by Mr.
Picard from lawsuits or settlements.
BONDS.COM GROUP: Awards Stock Options to Officers and Directors
---------------------------------------------------------------
Bonds.com Group, Inc., awarded stock options to H. Eugene Lockhart
and Patricia Kemp, each directors of the Company. Each option was
fully vested upon grant and provides the holder with the right to
purchase up to 6,157,767 shares of the Company's Common Stock at
an exercise price of $0.075 per share, which was the most recent
closing price of the Company's Common Stock reported on the OTC
Bulletin Board as of the date of grant.
Additionally, on July 14, 2011, the Company awarded stock options
to Michael O. Sanderson, the Company's chief executive officer;
George O'Krepkie, the Company's president; Jeffrey M. Chertoff,
the Company's chief financial officer; and John Ryan, the
Company's chief administrative officer, pursuant to the Company's
2011 Equity Plan. The options awarded to Messrs. Sanderson,
O'Krepkie, Chertoff and Ryan provide them with the right to
purchase up to 41,051,780, 3,901,780, 8,000,000 and 8,000,000
shares of the Company's Common Stock, respectively, at an exercise
price of $0.075 per share. Each of these options was 25% vested
upon grant, with the balance vesting in equal quarterly
installments over a four-year period.
About Bonds.com Group
Based in Boca Raton, Florida, Bonds.com Group, Inc. (OTC BB: BDCG)
-- http://www.bonds.com/-- through its subsidiary Bonds.com,
Inc., serves institutional fixed income investors by providing a
comprehensive zero subscription fee online trading platform. The
Company designed the BondStation and BondStationPro platforms to
provide liquidity and competitive pricing to the fragmented Over-
The-Counter Fixed Income marketplace.
The Company differentiates itself by offering through Bonds.com,
Inc. an inventory of more than 35,000 fixed income securities from
more than 175 competing sources. Asset classes currently offered
on BondStation and BondStationPro, the Company's fixed income
trading platforms, include municipal bonds, corporate bonds,
agency bonds, certificates of deposit, emerging market debt,
structured products and U.S. Treasuries.
The Company reported a net loss applicable to common stockholders
of $12.51 million on $2.71 million of revenue for the year ended
Dec. 31, 2010, compared with a net loss applicable to common
stockholders of $4.69 million on $3.90 million of revenue during
the prior year.
As reported by the TCR on May 9, 2011, Daszkal Bolton LLP, in Boca
Raton, Fla., in its audit reports for the years ended Dec. 31,
2009, and Dec. 31, 2010, expressed substantial doubt about the
Company's ability to continue as a going concern. The auditors
noted that the Company has sustained recurring losses and has
negative cash flows from operations.
"We have a history of operating losses since our inception in
2005, and have a working capital deficit of approximately
$4.4 million and an accumulated deficit of approximately
$28.6 million at Dec. 31, 2010, which together raises doubt about
the Company's ability to continue as a going concern," the Company
acknowledged in the Form 10-K.
The Company's balance sheet at March 31, 2011, showed $6.26
million in total assets, $11.29 million in total liabilities and a
$5.03 million stockholders' deficit.
BRICOLAGE CAPITAL: Ernst & Young to Face Tax Shelter Case
---------------------------------------------------------
Eric Hornbeck at Bankruptcy Law360 reports that a New York state
judge ruled Wednesday that Ernst & Young LLP must face fraud
allegations over shady tax shelters, part of a wide-ranging
scandal that bankrupted Bricolage Capital LLC and ensnared
attorneys and other individuals in criminal charges.
According to Law360, Ernst & Young argued that the advice it gave
Bricolage Capital about tax shelters, known as personal investment
corporations, were opinions and not misrepresentations, but
New York Supreme Court Judge Barbara R. Kapnick rejected that
argument because two accounting firm principals were later
convicted.
Headquartered in New York, New York, Bricolage Capital LLC filed
for chapter 11 protection (Bankr. S.D.N.Y. Case No. 05-46914) on
Oct. 14, 2005. Robert E. Grossman, Esq., Lawrence J. Kotler,
Esq., and Matthew E. Hoffman, Esq., at Duane Morris LLP represent
the Debtor in its restructuring efforts. No Official Committee of
Unsecured Creditors has been appointed in the Debtor's case. The
Debtor estimated assets of $1 million to $10 million and debts of
$10 million to $50 million as of the Chapter 11 filing.
CARLISLE APARTMENTS: Can Obtain $28.5-Mil. in DIP Loans from NXT
----------------------------------------------------------------
Judge Stuart M. Bernstein of the U.S. Bankruptcy Court for the
Southern District of New York authorized The Carlisle Apartments,
L.P., to obtain $28,500,000 postpetition financing from NXT
Capital LLC to consummate the settlement agreement with Compass
Bank and permit the consensual use of cash collateral.
The Settlement with the Bank provides the means by which Debtor
can extinguish all obligations between Debtor and the Bank,
including its note and concomitant swap obligation owing from
Debtor to the Bank, at a discount of 10%, which provides Debtor
with significant savings. Under the settlement, the Bank will
extinguish all of the Debtor's obligations for $30 million. The
Debtor will also pay a prepetition swap obligation owed to the
Bank at closing in the amount of $26,382.
The Bank's obligation to consummate the Transaction is contingent
upon, among other things, (a) the Transaction being consummated no
later than July 28, 2011, and the payment by RECAP Investments XI
- Fund A, L.P., and RECAP Investments XI - Fund B, L.P., of a
$2,000,000 non-refundable deposit.
At the closing of the Transaction, the Debtor and RECAP, on the
one hand, and the Bank, on the other hand, will exchange mutual
releases releasing one another from any and all liabilities in
respect of the Debtor, including a release of the guarantee
obligations of RECAP, and said releases are hereby authorized and
directed.
If the Transaction is consummated by the Outside Date, the
$2 million deposit and any interest it earns will be applied to
the Transaction Price.
If the Transaction is not consummated on or before the Outside
Date, then on the day following the Outside Date, and provided
that the Bank did not default on its obligation to consummate the
Transaction, the Bank will apply the Deposit and any interest
earned thereon to reduce the principal outstanding under the Note,
and the Debtor's interest payments will be reduced accordingly.
If the Transaction is not consummated, but a plan of
reorganization is confirmed within 75 days of the filing of the
Plan, then the Deposit and any interest earned thereon will be
applied against the cash pay-down to the Bank required under the
Plan.
If neither the Transaction nor the Plan is consummated, then the
Bank may apply the Deposit and any interest earned thereon in
accordance with the documents governing the Obligations and
applicable law; provided, however, that the Bank must promptly
give RECAP an accounting of how the Deposit is being applied.
Within one week from the 46th day following June 13, 2011, if the
Transaction has not been consummated, the Debtor will file the
Plan, and the Bank will support confirmation of the Plan for a
period of 75 days from the date of the filing of the Plan, but
thereafter will have no obligation to do so. From the date of the
filing of the Plan, and without regard to the status of the
Transaction, the Debtor will pursue confirmation of the Plan in
good faith. If the Transaction is consummated prior to the date
set for a hearing on confirmation of the Plan, then the Debtor may
withdraw or amend the Plan.
If the Transaction has not been consummated by the Outside Date,
and provided, that the Debtor has filed the Plan in accordance
with the terms of the Settlement, then at the sole option of the
Bank, the Outside Date will be extended for two weeks provided
that RECAP will provide to the Bank an additional deposit.
Thereafter, the Bank, at its sole option, and upon the request of
the Debtor, may grant additional one week extensions of the
Outside Date, and for each extension granted, the Transaction
Price will increase by $100,000.
If, and only if, the Transaction is consummated, the Debtor or
RECAP will reimburse the Bank for its reasonable expenses,
including attorney fees, related solely to the Transaction, up to
a maximum amount of $75,000.
The Court also granted NXT a first priority deed of trust on the
Debtor's property known as Phillips University Center, a 372-unit,
garden style apartment complex in Charlotte, North Carolina.
Additional Terms of DIP Debt
The Postpetition Debt will bear an interest rate equal to a
floating rate per annum equal to the aggregate of 4% plus the Base
Rate, but in no event will the Interest Rate be lower than 6.75%.
So long as the Debtor remains in bankruptcy, the Interest Rate
will be 7.50%.
A $15,000 application fee, plus a $99,100 good faith deposit, is
required with submission of the loan application. RECAP has
advanced these sums as an equity contribution to Debtor, and the
Debtor is authorized to account for it as such.
The Loan Fee is 1.25% of the Maximum Amount.
Upon payment of the Postpetition Debt in full, whether at Maturity
or on any other date, the Debtor will pay to Postpetition Lender
the Exit Fee plus the Minimum Interest Recovery. Upon any partial
repayment of the Postpetition Debt, Debtor will pay to
Postpetition Lender the pro rata portion of the Exit Fee allocable
to the amount of Postpetition Debt being repaid, and upon final
payment in full of the Postpetition Debt, the Exit Fee due
Postpetition Lender will be reduced by any portions of the
Exit Fee previously received by Postpetition Lender and applied
toward the Exit Fee as a result of any previous partial repayment
of Postpetition Debt.
The Exit Fee is equal to $427,500; provided however, that in the
event the Debtor has not exited from bankruptcy within 90 days
from the Closing Date without triggering a Termination Date, the
Exit Fee will be $570,000. In the event the Debtor has not exited
from bankruptcy without triggering a Termination Date within 150
days from the Closing Date, the Exit Fee will be $712,500.
The minimum interest recovery is the amount, if any, by which
$1,923,750 exceeds the amount of interest actually paid by Debtor
to Postpetition Lender prior to repayment of the Postpetition Debt
in full or acceleration of the Postpetition Debt.
The postpetition financing will mature three years from the
Closing Date, subject to an optional one year extension.
The Postpetition Debt is granted superpriority administrative
expense status under Section 364(c)(1) of the Bankruptcy Code,
with priority over all costs and expenses of administration of the
Cases that are incurred under any provision of the Code. In
addition, Postpetition Lender is granted the Postpetition Liens,
to secure the Postpetition Debt.
There will be a Carveout for Professionals not exceeding $434,750.
A Carveout for a Chapter 7 Trustee is pegged at $30,000. There is
also a Carveout for all fees which become due and owing to the
U.S. Trustee. The Carveout with respect to the U.S. Trustee Fees
will be paid out of any prepetition retainer or property of the
estate before such payments are made from proceeds of the
Postpetition Debt or the Postpetition Collateral.
About Carlisle Apartments
The Carlisle Apartments, L.P., filed a Chapter 11 petition (Bankr.
S.D.N.Y. Case No. 10-16805) in Manhattan on Dec. 27, 2010. The
Debtor estimated assets and debts of $10 million to $50 million as
of the Chapter 11 filing. Peter Alan Zisser, Esq., at Squire,
Sanders & Dempsey LLP, in New York, serves as bankruptcy counsel
to the Debtor. Gordian Group, LLC, is the investment banker and
financial advisor.
CARLISLE APARTMENTS: Exclusive Filing Period Extended to Aug. 5
---------------------------------------------------------------
Hon. Stuart H. Bernstein has extended The Carlisle Apartments,
L.P.'s exclusive period to file a plan and disclosure statement to
Aug. 5, 2011, and the exclusive period to solicit acceptances to a
plan to Oct. 4, 2011.
The Carlisle Apartments, L.P., filed a Chapter 11 petition (Bankr.
S.D.N.Y. Case No. 10-16805) in Manhattan on Dec. 27, 2010. The
Debtor estimated assets and debts of $10 million to $50 million as
of the Chapter 11 filing. Peter Alan Zisser, Esq., at Squire,
Sanders & Dempsey LLP, in New York, serves as bankruptcy counsel
to the Debtor. Gordian Group, LLC, is the investment banker and
financial advisor.
CIRCLE ENTERTAINMENT: Six Directors Elected at Annual Meeting
-------------------------------------------------------------
Circle Entertainment Inc. held its 2011 annual meeting of
Stockholders on July 21, 2011, at which the stockholders (i)
elected six directors to serve on the Company's Board of Directors
until the next annual meeting of stockholders and until their
respective successors are duly elected and qualified and (ii)
ratified the appointment of L.L. Bradford & Company, LLC, as the
Company's independent registered public accounting firm for the
fiscal year ending Dec. 31, 2011. The directors elected at Annual
Meeting are:
(1) Robert F.X. Sillerman;
(2) Paul C. Kanavos;
(3) Michael J. Meyer;
(4) John D. Miller;
(5) Harvey Silverman; and
(6) Robert Sudack
About Circle Entertainment
Circle Entertainment Inc. (CEXE.PK), formerly FX Real Estate and
Entertainment Inc., owns 17.72 contiguous acres of land located at
the southeast corner of Las Vegas Boulevard and Harmon Avenue in
Las Vegas, Nevada. The Las Vegas Property is currently occupied
by a motel and several commercial and retail tenants with a mix of
short and long-term leases. On June 23, 2009, as a result of the
default under the first mortgage loan, the first lien lenders had
a receiver appointed to take control of the property. The Company
is headquartered in New York City.
The Company's balance sheet at March 31, 2011, showed
$1.97 million in total assets, $4.38 million in total liabilities,
and a $2.41 million total stockholders' deficit.
The Company disclosed in its Form 10-Q for the quarter ended
June 30, 2010, that it has no current cash flow and cash on hand
as of Aug. 13, 2010, is not sufficient to fund its short-term
liquidity requirements, including its ordinary course obligations
as they come due. On April 21, 2010, the Company's remaining Las
Vegas subsidiary, namely FX Luxury Las Vegas I, LLC, filed for
Chapter 11 in the U.S. Bankruptcy Court for the District of Nevada
(Case No. 10-17015).
The Company's Las Vegas subsidiary filed for Chapter 11 bankruptcy
on April 21, 2010, and a plan of liquidation or reorganization
will eventually be implemented under which the Company will
surrender ownership of the Las Vegas Property. Under such a plan,
it is extremely unlikely the Company will receive any material
interest or benefit.
The Company reported net income of $346.81 million on $0 of
revenue for the year ended Dec. 31, 2010, compared with a net loss
of $114.68 million on $0 of revenue during the prior year. The
net profit generated in the year was primarily on account of a
$390.75 million gain from discharge of net assets due to
bankruptcy plan. The Company's operating subsidiary sought
Chapter 11 protection last year.
As reported by the TCR on April 11, 2011, L.L. Bradford & Company,
LLC, in Las Vegas, Nevada, expressed substantial doubt about the
Company's ability to continue as a going concern. The independent
auditors noted that the Company has limited available cash, has a
working capital deficiency and will need to secure new financing
or additional capital in order to pay its obligations.
CONTESSA PREMIUM: Closes Sale to Sun Capital Partners
-----------------------------------------------------
Dow Jones' DBR Small Cap reports that private equity firm Sun
Capital Partners Inc. completed its purchase of the assets of
frozen-food maker Contessa Premium Foods Inc. from its Chapter 11
bankruptcy proceeding.
As reported in the July 8, 2011 edition of the Troubled Company
Reporter, reports that that an affiliate of Sun Capital Partners
Inc. made a bid of $27 million and won the auction to buy Contessa
Premium Foods Inc. The sale included a new manufacturing facility
in Commerce, California, designed to be the "world's first
environmentally friendly frozen food processing center," a court
filing said.
Sun Capital, a Boca Raton, Florida-based private-equity investor,
paid $55 million in June to buy U.S. subsidiaries of Mexican
glassmaker Vitro SAB in a Chapter 11 sale.
Contessa's sales fell from a peak of $221 million in 2007 to
$154 million in 2010, according to court papers. Consumers are
buying less expensive alternatives to privately owned Contessa's
products, the filing said.
Los Angeles-based law firm Rutter Hobbs & Davidoff represented
Contessa CEO John Blazevich in the transaction. Attorneys Brian
Davidoff, Benjamin Alexander and Nancy Morgan of Rutter Hobbs &
Davidoff represented and advised Blazevich through the bankruptcy
and final transaction.
About Contessa Premium
San Pedro, California-based Contessa Premium Foods, Inc., fka ZB
Industries, Inc., and Contessa Food Products, Inc., provides farm
raised shrimp, convenience meals, stir-fry vegetables, and other
frozen food products that are marketed and sold primarily in the
United States and to a lesser extent in Canada, Europe, Asia, and
Mexico. It divides its business into two internal groups:
Contessa Seafood, which includes its seafood items, and Contessa
"Green Cuisine," which includes all other fruit, vegetable and
complete meal blends.
Contessa Premium filed for Chapter 11 bankruptcy protection
(Bankr. C.D. Calif. Case No. 11-13454) on Jan. 26, 2011. Craig A.
Wolfe, Esq., at Kelley Drye & Warren LLP, in New York, represents
the Debtor as counsel. Jeffrey N. Pomerantz, Esq., and Jeffrey W.
Dulberg, Esq., at Pachulski Stang Ziehl & Jones LLP, in Los
Angeles, serve as conflicts counsel for the Debtor. Scouler &
Company, LLC, serves as financial advisors. Imperial Capital, LLC
serves as investment banker. Holthouse Carlin & Van Trigt LLP
serves as auditors and accountants. The Debtor scheduled
$49,370,438 in total assets and $35,305,907 in total liabilities.
The Official Committee of Unsecured Creditors in the Debtor's
Chapter 11 case is represented by Arent Fox LLP. FTI Consulting
Inc. serves as its financial consultants.
COSTA DORADA: Meeting of Creditors Continued Until Aug. 3
---------------------------------------------------------
Wigberto Lugo Mender, attorney for Costa Dorada Apartments Corp.,
dba Villas De Costa Dorada, disclosed that the a continuance of
the meeting of creditors pursuant to 11 U.S.C. Section 341 set for
July 11, 2011, at 1:00 p.m. has been re-scheduled for Aug. 3, at
1:00 p.m.
The meeting will be held at
Edificio Ochoa
Calle Tanca
Comercio, Piso 1,
San Juan, P.R.
Attendance by the Debtors' creditors at the meeting is welcome,
but not required. The Section 341(a) meeting offers the creditors
a one-time opportunity to examine the Debtor's representative
under oath about the Debtor's financial affairs and operations
that would be of interest to the general body of creditors.
About Costa Dorada Apartments
Costa Dorada Apartments Corp., dba Villas De Costa Dorada, in
Isabela, Puerto Rico, filed for Chapter 11 bankruptcy (Bankr. D.
P.R. Case No. 11-03960) on May 10, 2011. In its petition, the
Debtor estimated $10 million to $50 million in assets and debts.
The petition was signed by Carlos R. Fernandez Rodriguez, its
president.
COSTA DORADA: Court OKs Lugo Mender & Co. as Legal Representative
-----------------------------------------------------------------
The U.S. Bankruptcy Court of Puerto Rico has approved Costa Dorada
Apartments Corp.'s application to employ Lugo Mender & Co. as its
legal representative.
The firm's rates are:
Wigberto Lugo Mender, Esq. $265 per hour
Associate Staff Attorney $150 per hour
Legal and Financial Assistants $100 per hour
The firm has received $10,000 as retainer. According to papers
filed in Court, the sum was generated by the Debtor from the
regular operations of its farm.
Wigberto Lugo Mender, Esq., attests that his firm has no
connection with the Debtors, the creditors, any party in interest,
their attorneys, their accountants and the U.S. Trustee's Office
or any person employed by said office, except that Wigberto Lugo
Mender, Esq. was an employee of the U.S. Trustee's Office until
September 15, 1995. In addition, he is currently appointed to the
Panel of private trustees for the Judicial District of Puerto
Rico.
Wigberto Lugo Mender and his law firm are disinterested persons
within the definition provided by the Bankruptcy Code.
The firm may be reached at:
Wigberto Lugo Mender, Esq.
LUGO MENDER & CO.
Centro Internacional de Mercadeo
Carr. 165 Torre I Suite 501
Guaynabo, PR 00968
Tel: (787)707-0404
Fax: (787)7007-0412
E-mail: wlugo@lugomender.com
About Costa Dorada Apartments
Costa Dorada Apartments Corp., dba Villas De Costa Dorada, in
Isabela, Puerto Rico, filed for Chapter 11 bankruptcy (Bankr. D.
P.R. Case No. 11-03960) on May 10, 2011. In its petition, the
Debtor estimated $10 million to $50 million in assets and debts.
The petition was signed by Carlos R. Fernandez Rodriguez, its
president.
COUNTRYWIDE FIN'L: Borrowers to Get $108 Million in Refunds
-----------------------------------------------------------
American Bankruptcy Institute reports that the Federal Trade
Commission said that, as a result of a settlement reached with the
Countrywide Financial more than a year ago, it is sending out
checks totaling nearly $108 million to more than 450,000 former
Countrywide borrowers.
Based in Calabasas, California, Countrywide Financial Corporation
(NYSE: CFC) -- http://www.countrywide.com/-- originated,
purchased, securitized, sold, and serviced residential and
commercial loans.
In mid-2008, Bank of America completed its purchase of Countrywide
for $2.5 billion. The mortgage lender was originally priced at
$4 billion, but the purchase price eventually was whittled down to
$2.5 billion based on BofA's stock prices that fell over 40% since
the time it agreed to buy the ailing lender.
CROSS BORDER: Hires Rodman & Renshaw as Financial Advisor
---------------------------------------------------------
Cross Border Resources Inc., on July 12, 2011, entered into an
agreement with Rodman & Renshaw under which R&R will serve as
their exclusive financial advisor for the Company in connection
with any transaction or related series or combination of
transactions involving a purchase or sale of assets or of
outstanding stock or a merger, acquisition or other business
combination, with certain exclusions. The agreement has a term of
three months.
R&R replaces C. K. Cooper as the Company's exclusive financial
advisor for any corporate transaction that may be contemplated for
the term of the agreement. The investment banking agreement with
C. K. Cooper was terminated. However, C.K. Cooper and the Company
still have a contractual relationship, whereby, C.K. Cooper will
remain as the Company Designated Advisor for Disclosure sponsor
with respect to the OTCQX.
About Cross Border Resources
Cross Border Resources, Inc. f/k/a Doral Energy Corp. (OTC BB:
DRLY) -- http://www.DoralEnergy.com/-- is a licensed oil and gas
operator in the state of New Mexico. The Company is headquartered
in Midland, Texas.
The Company's balance sheet at March 31, 2011, showed
$24.91 million in total assets, $11.98 million in total
liabilities, and $12.93 million in total stockholders' equity.
As reported in the Troubled Company Reporter on Nov. 23, 2010,
MaloneBailey, LLP, in Houston, Texas, expressed substantial doubt
about Doral Energy's ability to continue as a going concern
following the Company's results for the fiscal year ended July 31,
2010. The independent auditors noted that the Company has
negative working capital and recurring losses from operations.
CROWN MEDIA: S&P Assigns 'B' Corp. Credit Rating; Outlook Stable
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned Studio City, Calif.-
based cable network company Crown Media Holdings Inc. its 'B'
corporate credit rating. The outlook is stable.
"At the same time, we assigned issue-level ratings to the
company's new debt issues, which consist of a $30 million
superpriority senior secured revolving credit facility due 2016, a
$210 million senior secured term loan due 2018, and $300 million
of senior unsecured notes due 2019. The company used the proceeds
of the new debt issues to repay term loans and redeem preferred
stock," S&P related.
"We rate the revolving credit facility 'BB-' (two notches higher
than the 'B' corporate credit rating on the company) with a
recovery rating of '1', indicating our expectation of very high
(90% to 100%) recovery for lenders in the event of a payment
default. We also rate the senior secured term loan 'BB-' with a
'1' recovery rating," S&P stated.
"In addition, we assigned the senior notes our issue-level rating
of 'B-' (one notch lower than the corporate credit rating) with a
recovery rating of '5', indicating our expectation of modest (10%
to 30%) recovery for noteholders in the event of a payment
default," S&P related.
"These rating assignments follow our review of the final
transaction documentation," said Standard & Poor's credit analyst
Deborah Kinzer.
Crown Media owns and operates two cable TV channels, the Hallmark
Channel and Hallmark Movie Channel, in the U.S. Neither channel is
fully distributed, with the Hallmark Channel reaching about 87.7
million subscribers and the Hallmark Movie Channel reaching about
41 million subscribers, compared with about 105 million total
domestic cable and satellite TV subscribers, after 10 years of
operation for the company. Some cable operators do not put the
company's channels on their basic tier, particularly the movie
channel, which leads to lower penetration and lower subscription
and ad revenue. Crown Media's proportion of subscription revenue
to total revenue is only about 25%, compared with 40%-50% for
other cable network companies. Advertising revenue forms the
remaining three-fourths of total revenue, and growth in ad revenue
is subject to both economic conditions and audience ratings. Apart
from special programming aired during the holiday season, the
networks' audience ratings are low. The Hallmark Channel ranked
22nd among cable channels in total day viewership in the first
quarter of 2011, and the Hallmark Movie Channel ranked 42nd. The
company is introducing new daytime content in an attempt to
attract higher audience ratings and younger viewers, but initially
this has resulted in confusion among viewers and ratings declines.
"We expect the company to benefit from the generally favorable ad
demand in 2011, but achievement of more rapid ad revenue and
subscription revenue growth will depend on the company's ability
to attract more viewers with appealing new programming, which is
likely to take several years and additional investment," said Ms.
Kinzer. "Over the longer term, we expect Crown Media and other
cable network companies to face growing competition from the
Internet and other forms of digital media, which could lower
audience share and lessen attractiveness as an advertising
medium."
"The stable rating outlook reflects our expectation that the
company could reduce its lease-adjusted leverage over the
intermediate term through EBITDA growth and modest debt repayment,
barring any unforeseen events," S&P said.
DAVE & BUSTERS: S&P Puts 'B-' Credit Rating on Watch Positive
-------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on Dallas-
based Dave & Buster's Inc., including its 'B-' corporate credit
rating, on CreditWatch with positive implications.
The CreditWatch placement follows Dave & Buster's parent's
announced IPO to raise capital that it plans to use to reduce
debt. According to the SEC filing, the target is to raise gross
proceeds of approximately $150 million.
"We believe the company could use the proceeds from the
prospective IPO to delever the balance sheet, resulting in
improved credit protection measures," said Standard & Poor's
credit analyst Andy Sookram. "Pro forma for the planned
debt reduction, leverage declines to around 5.8x from 6.9x at May
1, 2011. In addition, funds from operations to debt increases to
slightly over 10% from 8%. These credit metrics are commensurate
with the 'B' rating category, given our view of its business risk
profile as vulnerable."
"We aim to resolve the CreditWatch listing when the IPO is
completed, with a possible outcome of a one-notch raising of the
corporate credit rating, to 'B' from 'B-'. Additional support for
an upgrade comes from our expectation that operating performance
will remain good because of increasing customer traffic due to
promotional activities and higher selling prices. We will also
review the company's business prospects and financial policies for
the near term," S&P said.
DEB SHOPS: U.S. Trustee Names 5-Member Creditors Committee
----------------------------------------------------------
Roberta A. Deangelis, United States Trustee for Region 3, under 11
U.S.C. SEC 1102(a) and (b), appointed five unsecured creditors to
serve on the Official Committee of Unsecured Creditors of Deb
Shops Inc.
The Creditors Committee members are:
1. HBK Master Fund L.P.
ATTN: J. Baker Gentry, Jr.,
2101 Cedar Springs Road,
Suite 700, Dallas TX 75201
Tel: (214) 758-6531
Fax: (214) 979-8331
2. Finesse Apparel, Inc.
ATTN: Jung Hwan Han
1025 Stanford Avenue
Los Angeles CA
90021
Tel: (213) 747-7077
Fax: (213) 747-2776
3. One Step Up
ATTN: Thomas DiBuduo
1412 Broadway
New York NY 10018
Tel: (212) 398-1110
Fax: (212) 819-1933
4. GGP Limited Partnership
ATTN: Julie M. Bowden
110 North Wacker Drive
Chicago IL 60606
Tel: (312) 960-2707
Fax: (312) 442-6374
5. Simon Property Group, Inc.
ATTN: Ronald M. Tucker
225 West Washington Street,
Indianapolis IN 46204
Tel: (317) 263-2346
Fax: (317) 263-7901
About Deb Shops
Deb Shops Inc., is a closely held women's-clothing retailer based
in Philadelphia. Deb Shops sells junior and large-size clothing
for girls and women ages 13 to 25 through more than 320 U.S.
stores and through debshops.com. It was bought out by the New
York investment firm Lee Equity Partners in October 2007.
DSI Holdings Inc. and 54 affiliates, including Deb Shops, sought
bankruptcy protection (Bankr. D. Del. Lead Case No. 11-11941), on
June 26, 2011, to sell all assets under 11 U.S.C. Sec. 363. As of
April 30, 2011, the Debtors' unaudited financial statements
reflected assets totaling $124.4 million and liabilities totaling
$270.1 million.
Lawyers at Weil Gotshal & Manges LLP and Richards, Layton & Finger
P.A. serve as bankruptcy counsel. Rothschild Inc. serves as the
Debtors' investment banker and financial advisors. Sitrick &
Company serves as public relations consultants.
Ableco, the DIP Agent is represented by Michael L. Tuchin, Esq.,
and David A. Fidler, Esq., at Klee Tuchin Bogdanoff & Stern LLP.
Conway Del Genio serves as financial advisors to the First Lien
Lenders. Schulte Roth serves as corporate and tax advisors to the
First Lien Lenders. Another lender, Lee DSI Holdings, is
represented by Jennifer Rodburg, Esq., at Fried Frank Harris
Shriver & Jacobson LLP.
DEB SHOPS: Court OKs Employment of Richards Layton as Co-Counsel
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware has
approved DSI Holdings Inc.'s application to employ Richards,
Layton & Finger P.A. as co-counsel.
The firm, will among other things:
a) take all necessary actions to protect and preserve the
estates of the Debtors, including the prosecution of actions
on the Debtors' behalf, the defense of any actions commenced
against the Debtors, the negotiation of disputes in which
the Debtors are involved and, the preparation of objections
to claim filed against the Debtors' estate;
b) advise the Debtors of their rights, powers, and duties as
debtors and debtors in possession under chapter 11 of the
bankruptcy Code; and
c) prepare on behalf of the Debtors, as debtors in possessions,
all necessary motions, applications, answers, orders,
reports, and other papers in connections with the
administration of the Debtors' estates and serve such papers
on creditors.
The firm's rates are:
Personnel Rates
--------- -----
Mark D. Collins $725 per hour
Jason M. Madron $425 per hour
Drew G. Sloan $340 per hour
Julie A. Finocchiaro $225 per hour
Rebecca V. Speaker $200 per hour
About Deb Shops
Deb Shops Inc., is a closely held women's-clothing retailer based
in Philadelphia. Deb Shops sells junior and large-size clothing
for girls and women ages 13 to 25 through more than 320 U.S.
stores and through debshops.com. It was bought out by the New
York investment firm Lee Equity Partners in October 2007.
DSI Holdings Inc. and 54 affiliates, including Deb Shops, sought
bankruptcy protection (Bankr. D. Del. Lead Case No. 11-11941), on
June 26, 2011, to sell all assets under 11 U.S.C. Sec. 363. As of
April 30, 2011, the Debtors' unaudited financial statements
reflected assets totaling $124.4 million and liabilities totaling
$270.1 million.
Lawyers at Weil Gotshal & Manges LLP and Richards, Layton & Finger
P.A. serve as bankruptcy counsel. Rothschild Inc. serves as the
Debtors' investment banker and financial advisors. Sitrick &
Company serves as public relations consultants.
Ableco, the DIP Agent is represented by Michael L. Tuchin, Esq.,
and David A. Fidler, Esq., at Klee Tuchin Bogdanoff & Stern LLP.
Conway Del Genio serves as financial advisors to the First Lien
Lenders. Schulte Roth serves as corporate and tax advisors to the
First Lien Lenders. Another lender, Lee DSI Holdings, is
represented by Jennifer Rodburg, Esq., at Fried Frank Harris
Shriver & Jacobson LLP.
DENNY'S CORPORATION: Donald Shepherd to Retire from Board
---------------------------------------------------------
Donald R. Shepherd notified Denny's Corporation that he will
retire from the Board of Directors of the Company effective
July 31, 2011. Mr. Shepherd, 74, who has served as a board member
since 1998, served on the board's Audit and Finance Committee and
Compensation and Incentives Committee. He stated that his desire
to retire was the basis for his decision. Mr. Shepherd indicated
that he had no disagreements with the Company, its management or
the other directors.
About Denny's Corporation
Based in Spartanburg, South Carolina, Denny's Corporation (NASDAQ:
DENN) -- http://www.dennys.com/-- Denny's is one of America's
largest full-service family restaurant chains, consisting of 1,348
franchised and licensed units and 232 company-owned units, with
operations in the United States, Canada, Costa Rica, Guam, Mexico,
New Zealand and Puerto Rico.
The Company's balance sheet at March 30, 2011, showed
$296.77 million in total assets, $399.02 million in total
liabilities, and a $102.25 million total shareholders' deficit.
Denny's carries 'B2' corporate family and probability of default
ratings from Moody's Investors Service and a 'B+' corporate credit
rating from Standard & Poor's.
DEX MEDIA EAST: Bank Debt Trades at 27% Off in Secondary Market
---------------------------------------------------------------
Participations in a syndicated loan under which Dex Media East LLC
is a borrower traded in the secondary market at 72.95 cents-on-
the-dollar during the week ended Friday, July 22, 2011, a drop of
0.68 percentage points from the previous week according to data
compiled by Loan Pricing Corp. and reported in The Wall Street
Journal. The Company pays 250 basis points above LIBOR to borrow
under the facility. The bank loan matures on Oct. 24, 2014. The
loan is one of the biggest gainers and losers among 208 widely
quoted syndicated loans with five or more bids in secondary
trading for the week ended Friday.
About Dex Media East
Based in Cary, North Carolina, R.H. Donnelley Corp., fka The Dun &
Bradstreet Corp. (NYSE: RHD) -- http://www.rhdonnelley.com/--
publishes and distributes print and online directories in the U.S.
It offers print directory advertising products, such as yellow
pages and white pages directories. R.H. Donnelley Inc., Dex
Media, Inc., and Local Launch, Inc., are the company's only direct
wholly owned subsidiaries.
Dex Media East LLC is a publisher of the official yellow pages and
white pages directories for Qwest Communications International
Inc. (Qwest) in the states, where Qwest is the primary incumbent
local exchange carrier, such as Colorado, Iowa, Minnesota,
Nebraska, New Mexico, North Dakota and South Dakota.
R.H. Donnelley Corp. and 19 of its affiliates, including Dex Media
East LLC, Dex Media West LLC and Dex Media, Inc., filed for
Chapter 11 protection on May 28, 2009 (Bank. D. Del. Case No. 09-
11833 through 09-11852), after missing a $55 million interest
payment on its senior unsecured notes due April 15. James F.
Conlan, Esq., Larry J. Nyhan, Esq., Jeffrey C. Steen, Esq.,
Jeffrey E. Bjork, Esq., and Peter K. Booth, Esq., at Sidley Austin
LLP, in Chicago, Illinois represent the Debtors in their
restructuring efforts. Edmon L. Morton, Esq., and Robert S.
Brady, Esq., at Young, Conaway, Stargatt & Taylor LLP, in
Wilmington, Delaware, serve as the Debtors' local counsel. The
Debtors' financial advisor is Deloitte Financial Advisory Services
LLP while its investment banker is Lazard Freres & Co. LLC. The
Garden City Group, Inc., is claims and noticing agent. The
Official Committee of Unsecured Creditors tapped Ropes & Gray LLP
as its counsel, Cozen O'Connor as Delaware bankruptcy co-counsel,
J.H. Cohn LLP as its financial advisor and forensic accountant,
and The Blackstone Group, LP, as its financial and restructuring
advisor.
The Debtors emerged from Chapter 11 bankruptcy proceedings at the
end of January 2010.
DEX MEDIA WEST: Bank Debt Trades at 17% Off in Secondary Market
---------------------------------------------------------------
Participations in a syndicated loan under which Dex Media West LLC
is a borrower traded in the secondary market at 82.58 cents-on-
the-dollar during the week ended Friday, July 22, 2011, a drop of
0.67 percentage points from the previous week according to data
compiled by Loan Pricing Corp. and reported in The Wall Street
Journal. The Company pays 450 basis points above LIBOR to borrow
under the facility. The bank loan matures on Oct. 24, 2014. The
loan is one of the biggest gainers and losers among 208 widely
quoted syndicated loans with five or more bids in secondary
trading for the week ended Friday.
About Dex Media West
Dex Media West LLC is a subsidiary of Dex Media West, Inc., and an
indirect wholly owned subsidiary of Dex Media, Inc. Dex Media is
a direct wholly owned subsidiary of R.H. Donnelley Corporation.
Dex Media West is the exclusive publisher of the official yellow
pages and white pages directories for Qwest Corporation, the local
exchange carrier of Qwest Communications International, Inc., in
Arizona, Idaho, Montana, Oregon, Utah, Washington, and Wyoming.
R.H. Donnelley Corp. and 19 of its affiliates, including Dex Media
East LLC, Dex Media West LLC and Dex Media, Inc., filed for
Chapter 11 protection on May 28, 2009 (Bank. D. Del. Case No. 09-
11833 through 09-11852), after missing a $55 million interest
payment on its senior unsecured notes due April 15. James F.
Conlan, Esq., Larry J. Nyhan, Esq., Jeffrey C. Steen, Esq.,
Jeffrey E. Bjork, Esq., and Peter K. Booth, Esq., at Sidley Austin
LLP, in Chicago, Illinois represented the Debtors in their
restructuring efforts. Edmon L. Morton, Esq., and Robert S.
Brady, Esq., at Young, Conaway, Stargatt & Taylor LLP, in
Wilmington, Delaware, served as the Debtors' local counsel. The
Debtors' financial advisor was Deloitte Financial Advisory
Services LLP while its investment banker was Lazard Freres & Co.
LLC. The Garden City Group, Inc., was claims and noticing agent.
The Official Committee of Unsecured Creditors tapped Ropes & Gray
LLP as its counsel, Cozen O'Connor as Delaware bankruptcy co-
counsel, J.H. Cohn LLP as its financial advisor and forensic
accountant, and The Blackstone Group, LP, as its financial and
restructuring advisor.
The Debtors emerged from Chapter 11 bankruptcy proceedings at the
end of January 2010.
DIAMOND RANCH: Victor Petrone Resigns from All Positions
--------------------------------------------------------
Diamond Ranch Foods, Ltd., accepted the resignation of Victor
Petrone, the Company's chief financial officer, chief operating
officer and member of the Board of Directors. Effective April 10,
2011, to fill the vacancy created by Mr. Petrone's resignation as
Chief Financial Officer, the Company appointed Louis Vucci, Jr.,
President, Chief Executive Officer and Director, as the Company's
Chief Financial Officer. At this time, no one has been chosen to
fill the vacancies of Chief Operating Officer and member of the
Board of Directors left by the resignations of Mr. Petrone.
About Diamond Ranch
Diamond Ranch Foods, Ltd. -- http://www.diamondranchfoods.com/--
is a meat processing and distribution company now located in the
Hunts Point Coop Market, Bronx, New York. The Company's
operations consist of packing, processing, labeling, and
distributing products to a customer base, including, but not
limited to; in-home food service businesses, retailers, hotels,
restaurants, and institutions, deli and catering operators, and
industry suppliers.
The Company reported a net loss of $547,732 on $7.16 million of
net revenues for the fiscal year ended March 31, 2011, compared
with a net loss of $829,823 on $8.54 million of net revenues
during the prior year.
The Company's balance sheet at March 31, 2011, showed $942,000 in
total assets, $6.00 million in total liabilities, and a
$5.05 million total stockholders' deficit.
As reported by the TCR on July 18, 2011, Gruber & Company, LLC, in
Lake Saint Louis, Missouri, noted that the Company has suffered
recurring losses from operations that raise substantial doubt
about its ability to continue as a going concern.
DK AGGREGATES: Plan Outline Hearing Rescheduled Until Sept. 1
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Mississippi
has rescheduled until Sept. 1, 2011, at 1:30 p.m., the hearing to
consider adequacy of the disclosure statement explaining DK
Aggregates LLC's Chapter 11 plan.
The Plan proposes to pay 100% to all claim-holders except that the
percentage recovery of holders of damage suits or torts is limited
to policy limits under the proposed plan.
Among others, unsecured creditors, owed $1.75 million, will
receive 10 equal payments, first commencing four months after the
plan's effective date, and ever six months thereafter, until all
claims haven been satisfied. Secured claim of Hancock Bank will
be payable under a 20-year amortization with interest accruing at
6% per annum, with monthly payments of $10,542. Monthly payments
will commence on the 20th of the months immediately after the
plan's effective date. On the 60th month after the effective
date, the loan will mature and will be due and payable in full.
The adequate protection payments presently being made under order
of the Court will cease on the effective date.
A full-text copy of the Disclosure Statement is available for free
at http://bankrupt.com/misc/DKAGGREGATES_DS.pdf
A full-text copy of the Chapter 11 Plan is available for free
at http://bankrupt.com/misc/DKAGGREGATES_Plan.pdf
About DK Aggregates LLC
Pearlington, Mississippi-based DK Aggregates LLC filed for Chapter
11 bankruptcy protection (Bankr. S.D. Miss. Case No. 10-51823) on
Aug. 9, 2010. Robert Alan Byrd, Esq., at Byrd & Wiser, assists
the Debtor in its restructuring effort. The Debtor disclosed
assets of $17,025,695 and liabilities of $7,004,953 as of the
petition date.
The Troubled Company Reporter reported on June 22, 2011, that the
Debtor disclosed $18,529,695 in assets and $7,114,925 in
liabilities.
DK AGGREGATES: To Hire H. Kenneth Lefoldt, Jr. as Accountant
------------------------------------------------------------
DK Aggregates LLC seeks permission from the U.S. Bankruptcy Court
for the District of Mississippi to hire H. Kenneth Lefoldt, Jr.,
as accountant.
Upon retention, the firm, will among other things, assist the
Debtor in the preparation of the budgets, pro-formas, and
disclosure statement.
The firm's rate is $225 per hour.
Pearlington, Mississippi-based DK Aggregates LLC filed for Chapter
11 bankruptcy protection (Bankr. S.D. Miss. Case No. 10-51823) on
Aug. 9, 2010. Robert Alan Byrd, Esq., at Byrd & Wiser, assists
the Debtor in its restructuring effort. The Debtor disclosed
assets of $17,025,695 and liabilities of $7,004,953 as of the
Petition Date.
DOLLAR GENERAL: S&P Raises Corporate Credit Rating to 'BB+'
-----------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on discount
retailer Dollar General Corp. to 'BB+' from 'BB'. The outlook is
stable. "At the same time, we removed all ratings from
CreditWatch with positive implications, where they were placed on
June 17, 2011," S&P stated.
The upgrade follows the announcement that Dollar General redeemed
all $839.3 million outstanding 10.625% senior notes due 2015 using
cash on the balance sheet and about $300 million in borrowings
under its revolving credit facility. "We also withdrew the issue
and recovery rating on those notes," S&P said.
"The ratings on Dollar General reflect our expectation that the
company's value-focused merchandising strategy and continued store
expansion will sustain the positive operating momentum," said
Standard & Poor's credit analyst Ana Lai, "and contribute to
further improvement in credit measures."
DOUBLE G ARROWHEAD: Ruling Vacated in VCC Prepayment Clause Issue
-----------------------------------------------------------------
District Judge David G. Campbell vacated a Dec. 13, 2010 order of
the Bankruptcy Court denying one of VCC Healthcare Fund, LLC's
claims against Double G Arrowhead Orchards Limited Partnership as
an unenforceable penalty, and remanded for further proceedings.
Arrowhead borrowed $19 million on a 10-year commercial note,
secured by commercial property located in Glendale, Arizona. The
property is Arrowhead's sole substantial asset. VCC owns the
lender's rights to the note. Arrowhead defaulted on the note, VCC
accelerated the note and initiated foreclosure, and Arrowhead
filed for Chapter 11 bankruptcy. VCC filed claims for $17,937,304
in principal repayment and $356,748 in accrued interest and late
fees. When Arrowhead filed a motion seeking permission to auction
the property securing the note and to use the proceeds to pay
claims of VCC and other creditors, VCC took the position that
auctioning the property would trigger a prepayment clause in the
note and require an additional payment to VCC of $4,576,429.
Arrowhead objected, and the Bankruptcy Court held that VCC's
recovery would be limited to VCC's actual damages because the
Prepayment Clause is an "unenforceable penalty" under Arizona law.
VCC argues that the Bankruptcy Court erred as a matter of law in
finding that (1) the Prepayment Clause was a liquidated damages
provision, and (2) the Prepayment Clause was unenforceable as a
penalty. Arrowhead responds that both findings were correct as a
matter of law.
Applying de novo review, the District Court held that under
Arizona law (1) the harm caused by any breach of the note was, at
the time of contracting, incapable or very difficult of accurate
estimation, and (2) Arrowhead has not shown that the Prepayment
Clause failed, at the time of contracting, to provide a reasonable
forecast of just compensation for the harm caused by any future
breach. Arrowhead therefore has failed to show that the
Prepayment Clause is an unenforceable penalty under Arizona law.
The case is VCC Healthcare Fund, LLC, v. Double G Arrowhead
Orchards Limited Partnership, No. CV11-0004 (D. Ariz.). A
copy of the Court's July 20, 2011 Order is available at
http://is.gd/tEOe4xfrom Leagle.com.
Double G Arrowhead Orchards LP filed for Chapter 11 bankruptcy
(Bankr. D. Ariz. Case No. 10-20370) in 2010.
DSI HOLDINGS: Taps Rothschild Inc. as Exclusive Financial Advisor
-----------------------------------------------------------------
The Hon. Kevin J. Carey of the U.S. Bankruptcy Court for the
District of Delaware authorized DSI Holdings, Inc., and its
debtor-affiliates to employ Rothschild Inc. as exclusive financial
advisor and investment banker.
The Debtors believe that the nature of their business
relationships with vendors is fragile and thus, it is crucial for
the business to emerge from Chapter 11 quickly as possible. To
ensure a timely sale process and maximum value for the Debtors'
assets, it is essential to retain a financial advisor who has the
capability to conduct an auction for the Debtors' business as a
going concern. Prepetition, Rothschild has provided advisory
services to the Debtors.
Rothschild is expected to, among other things:
a) evaluate the Debtors' debt capacity in light of its
projected cash flows and assist in the determination of an
appropriate capital structure for the Debtors;
b) determine the range of values for the Debtors and any
securities that the Debtors offer or propose to offer in
connection with a transaction; and
c) advise the Debtors on the risks and benefits of considering
a transaction with respect to the Debtors' intermediate and
long-term business prospects and strategic alternatives to
maximize the business enterprise value of the Debtors.
In consideration of the services to be provided by Rothschild, the
Debtors agreed to pay Rothschild in cash pursuant to these fee
structure:
a) an monthly advisory fee of $15,000;
b) a completion fee of (i) 1,900,000 or (ii) $1,000,000, each
fee payable immediately upon the earlier of (A) the
confirmation and effectiveness of a plan and (B) the closing of
another transaction provided that the plan or other transaction
allows a material portion of the Debtors' business to continue
as a going concern.
c) a new capital fee equal to (i) 1.0% of the face amount of
any senior secured debt raised including, without limitation,
and DIP financing raised; (ii) 2.0% of the face amount of any
senior or subordinated unsecured debt raised; and (iii) 3.0% of
any equity capital, or capital convertible into equity, raised.
d) a discretionary fee of up to $500,000, in the event that a
successful outcome with respect to the transaction has been
achieved;
e) additional fees for additional services not contemplated in
the engagement letter; and
f) fee credits against completion fee 50% of any new capital
fees paid and 25% of any monthly fees paid, provided that these
fee credits will not exceed the completion fee.
To the best of the Debtors' knowledge, Rothschild is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
About Deb Shops
Deb Shops Inc., is a closely held women's-clothing retailer based
in Philadelphia. Deb Shops sells junior and large-size clothing
for girls and women ages 13 to 25 through more than 320 U.S.
stores and through debshops.com. It was bought out by the New
York investment firm Lee Equity Partners in October 2007.
DSI Holdings Inc. and 54 affiliates, including Deb Shops, sought
bankruptcy protection (Bankr. D. Del. Lead Case No. 11-11941), on
June 26, 2011, to sell all assets under 11 U.S.C. Sec. 363. As of
April 30, 2011, the Debtors' unaudited financial statements
reflected assets totaling $124.4 million and liabilities totaling
$270.1 million.
Lawyers at Weil Gotshal & Manges LLP and Richards, Layton & Finger
P.A. serve as bankruptcy counsel. Rothschild Inc. serves as the
Debtors' investment banker and financial advisors. Sitrick &
Company serves as public relations consultants. Kurtzman Carson
Consultants LLC serves as their claims and noticing agent.
Ableco, the DIP Agent is represented by Michael L. Tuchin, Esq.,
and David A. Fidler, Esq., at Klee Tuchin Bogdanoff & Stern LLP.
Conway Del Genio serves as financial advisors to the First Lien
Lenders. Schulte Roth serves as corporate and tax advisors to the
First Lien Lenders. Another lender, Lee DSI Holdings, is
represented by Jennifer Rodburg, Esq., at Fried Frank Harris
Shriver & Jacobson LLP.
DSI HOLDINGS: Meeting of Creditors Scheduled for Aug. 2
-------------------------------------------------------
Roberta DeAngelis, the U.S. Trustee for Region 3, will convene a
meeting of creditors in DSI Holdings, Inc. and its debtor-
affiliates' Chapter 11 cases on Aug. 2, 2011, at 1:30 p.m. The
meeting will be held at J. Caleb Boggs Federal Building, Room
5209, Wilmington Delaware.
This is the first meeting of creditors required under Section
341(a) of the Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
About Deb Shops
Deb Shops Inc., is a closely held women's-clothing retailer based
in Philadelphia. Deb Shops sells junior and large-size clothing
for girls and women ages 13 to 25 through more than 320 U.S.
stores and through debshops.com. It was bought out by the New
York investment firm Lee Equity Partners in October 2007.
DSI Holdings Inc. and 54 affiliates, including Deb Shops, sought
bankruptcy protection (Bankr. D. Del. Lead Case No. 11-11941) on
June 26, 2011, to sell all assets under 11 U.S.C. Sec. 363. As of
April 30, 2011, the Debtors' unaudited financial statements
reflected assets totaling $124.4 million and liabilities totaling
$270.1 million.
Lawyers at Weil Gotshal & Manges LLP and Richards, Layton & Finger
P.A. serve as bankruptcy counsel. Rothschild Inc. serves as the
Debtors' investment banker and financial advisors. Sitrick &
Company serves as public relations consultants. Kurtzman Carson
Consultants LLC serves as their claims and noticing agent.
Ableco, the DIP Agent is represented by Michael L. Tuchin, Esq.,
and David A. Fidler, Esq., at Klee Tuchin Bogdanoff & Stern LLP.
Conway Del Genio serves as financial advisors to the first lien
lenders. Schulte Roth serves as corporate and tax advisors to the
First Lien Lenders. Another lender, Lee DSI Holdings, is
represented by Jennifer Rodburg, Esq., at Fried Frank Harris
Shriver & Jacobson LLP.
DYNACAST INT'L: S&P Assigns 'B' Corporate Credit Rating
-------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' corporate
credit rating to Charlotte, N.C.-based Dynacast International LLC.
"At the same time, we assigned a 'BB-' issue-level rating (two
notches higher than the corporate credit rating) to the company's
$100 million credit facility. This facility includes a $50 million
term loan and $50 million revolver. The recovery rating is '1',
indicating our expectation of very high (90% to 100%) recovery in
a payment default scenario. The $350 million senior secured
second-lien notes are rated 'B' (the same as the corporate credit
rating), with a '4' recovery rating indicating our expectation of
average (30%-50%) recovery in a payment default scenario. The
outlook is stable," S&P said.
The ratings on Dynacast reflect its weak business risk profile and
highly leveraged financial risk profile. The company is the
largest player in the niche precision die cast components
industry. Dynacast's end-market diversity is limited, with over
one third of its revenues generated from the highly cyclical
automotive industry. Other end markets include consumer
electronics, health care, and computer and datacom. Customer
concentration is significant with one customer accounting for
about 10% of sales. Good geographic diversity and the ability to
pass on raw material costs somewhat offset these risks. Although
profitability weakened in the recent past due to the economic
recession, the complexity of the products and the small percentage
of the customer's total product cost that Dynacast's products
comprise enabled the company to generate good operating margins of
about 18% in 2010. "We expect the company to maintain this level
of profitability," said Standard & Poor's credit analyst Sarah
Wyeth.
Pro forma for the transaction, the ratio of total debt (including
operating leases, pension obligations, and preferred equity, which
we view as debt-like) to EBITDA is about 5.9x, and the ratio of
funds from operations (FFO) to total debt is less than 10%. "For
the ratings, we expect total debt to EBITDA of 5x to 6x and FFO to
total debt of 10%," said Ms. Wyeth.
The outlook is stable. Standard & Poor's could lower the ratings
if a cyclical downturn in Dynacast's primary end markets resulted
in increased competition and weak operating performance. While the
company's business risk profile could support a modestly higher
rating, this would be predicated on leverage sustained below 5x
and policies consistent with a higher rating.
EASTMAN KODAK: Exploring Strategic Options for Digital Imaging
--------------------------------------------------------------
Eastman Kodak Company announced that it is exploring strategic
alternatives related to its digital imaging patent portfolios, a
move reflecting the current heightened market demand for
intellectual property.
Kodak's portfolios include more than 1,100 U.S. patents pertaining
to capturing, processing, storing, organizing, editing, and
sharing digital images, as well as imaging monetization
applications, which are fundamental to the digital imaging
industry. Those patents represent approximately 10% of Kodak's
total U.S. patent portfolio.
To assist in this effort, Kodak has retained Lazard LLC as its
adviser. As the effort proceeds, Kodak will continue to pursue
its successful patent licensing program as well as all litigation
related to its digital imaging technology.
"Given recent trends in the marketplace for intellectual property,
we believe the time is right to explore smart, opportunistic
alternatives for our digital imaging patent portfolios," said
Laura G. Quatela, Kodak's General Counsel and a Senior Vice
President of the company. "This effort reaffirms our commitment
to the three pillars of our intellectual property strategy --
design freedom, access to new markets and partnerships, and cash
generation."
Kodak invented the digital camera and since then has pioneered
many of the major advances in digital imaging devices, systems and
services. The company's portfolios of more than 1,100 digital
imaging patents - plus foreign counterparts and related patent
applications - comprise the world's richest collection of imaging-
related technology.
About Eastman Kodak
Headquartered in Rochester, New York, Eastman Kodak Company
(NYSE:EK) -- http://www.kodak.com/-- provides imaging technology
products and services to the photographic and graphic
communications markets.
The Company's balance sheet at March 31, 2011, showed
$5.88 billion in total assets, $7.15 billion in total liabilities,
and a $1.27 billion total deficit.
* * *
As reported by the Troubled Company Reporter on March 2, 2011,
Standard & Poor's Ratings Services lowered its corporate credit
rating on Eastman Kodak to 'CCC' from 'B-'. S&P removed the
rating from CreditWatch, where S&P placed it with negative
implications on Jan. 26, 2011. The rating outlook is negative.
Issue-level ratings on the company's debt were also lowered and
removed from CreditWatch in conjunction with the corporate credit
rating change.
The 'CCC' corporate credit rating reflects S&P's expectation that
Eastman Kodak's pace of cash consumption will remain high over the
near term. It also reflects S&P's expectation of continued
secular volume decline of the traditional photographic products
and services business, that the company's consumer digital imaging
businesses will not quickly turn convincingly profitable, and that
intellectual property earnings, which constitute a significant
portion of the company's EBITDA, could decline significantly from
2010 levels. These factors underpin S&P's view of Kodak's
business risk as vulnerable and support S&P's view that revenue
and EBITDA will decline in 2011. S&P views the company's
financial risk profile as highly leveraged because of the risk
that its earnings and cash flow could become insufficient to
support its debt.
In the March 16, 2011 edition of the TCR, Fitch Ratings has
affirmed its 'CCC' Issuer Default Rating on Kodak. The ratings
and Negative Outlook reflect Kodak's continued struggles to gain
traction in its digital businesses as secular declines persist and
broaden to entertainment film within the traditional film
business.
In March, Moody's Investors Service demoted Kodak's corporate
rating to Caa1 coupled with a judgment the company "could" consume
$600 million to $700 million in cash during 2011. Moody's noted
that Kodak has no material debt maturities until November 2013.
ENERTECK CORP: Inks $4 Million Investment Agreement with Kodiak
---------------------------------------------------------------
EnerTeck Corporation, on July 15, 2011, entered into an Investment
Agreement with Kodiak Capital Group, LLC. The Investment
Agreement provides the Company an equity line whereby the Company
can issue and sell to the Investor, from time to time, shares of
the Company's common stock up to an aggregate purchase price of
$4.0 million during an open period.
As part of the consideration for the Financing, the Company agreed
to pay the Investor a document preparation fee of $10,000 and the
Company has agreed to issue to Investor an additional 200,000
shares of newly-issued common stock upon completion of the first
closing of the Financing which is no less than $200,000.
The Investment Agreement also provides that the Company will not
be entitled to deliver a Put Notice and the Investor will not be
obligated to purchase any Shares unless each of the following
conditions are satisfied:
(i) a registration statement has been declared effective and
remains effective for the resale of the Shares until the
closing with respect to the subject Put Notice;
(ii) at all times during the period beginning on the date of the
Put Notice and ending on the date of the related closing,
the Company's common stock has been listed on the Principal
Market as defined in the Investment Agreement and will not
have been suspended from trading thereon for a period of
two consecutive trading days during the Open Period;
(iii) the Company has complied with its obligations and is
otherwise not in breach of or in default under the
Investment Agreement, the Registration Rights Agreement or
any other agreement executed in connection therewith;
(iv) no injunction has been issued and remains in force, and no
action has been commenced by a governmental authority which
has not been stayed or abandoned, prohibiting the purchase
or the issuance of the Shares; and
(v) the issuance of the Shares will not violate any shareholder
approval requirements of the market or exchange on which
the Company's common stock are principally listed.
The Investment Agreement will terminate when any of the following
events occur: (i) the Investor has purchased an aggregate of $4.0
million of the Company's common stock, (ii) on the date which is
24 months following the effectiveness of the registration
statement, or (iii) upon written notice from the Company to the
Investor.
Similarly, this Investment Agreement, may, at the option of the
non-breaching party, terminate if the Investor or the Company
commits a material breach, or becomes insolvent or enters
bankruptcy proceedings.
The Company also entered into a Registration Rights Agreement with
the Investor on July 15, 2011. Pursuant to the Registration
Rights Agreement, the Company is obligated to file a registration
statement registering the resale of the Shares.
A full-text copy of the Investment Agreement is available for free
at http://is.gd/wcFMI7
A full-text copy of the Registration Rights Agreement is available
for free at http://is.gd/MkS79b
About Enerteck Corporation
EnerTeck Corporation (OTC BB: ETCK.OB) -- http://www.enerteck.net/
-- was incorporated in 1935 and is based in Stafford, Texas. The
Company develops, acquires and manufactures combustion
enhancement, emission reduction and other performance improvement
technologies for the heavy duty transportation industry.
EnerTeck's flagship product, EnerBurn(TM), is a diesel fuel
specific combustion catalyst, delivered to the engine via the
diesel fuel, to improve the combustion rate of the fuel.
The Company reported a net loss of $2.76 million on $231,314 of
product sales for the year ended Dec. 31, 2010, compared with a
net loss of $2.05 million on $404,335 of product sales during the
prior year.
The Company's balance sheet at March 31, 2011, showed $762,453 in
total assets, $3.07 million in total liabilities and a $1.98
million total stockholders' deficit.
Going Concern Doubt
During the years ended Dec. 31, 2010 and 2009, the Company
incurred recurring net losses of $2,763,000 and $2,054,000,
respectively. In addition, at Dec. 31, 2010, the Company has an
accumulated deficit of $24,214,474. These conditions raise
substantial doubt about the Company's ability to continue as a
going concern, according to the Form 10-K.
The Company's continuation as a going concern is contingent upon
its ability to obtain additional financing and to generate
revenues and cash flow to meet its obligations on a timely basis.
Management believes that sales revenues for 2010 and 2009 were
considerably less than earlier anticipated primarily due to
circumstances which have been corrected or are in the process of
being corrected. Management expects that marine, railroad and
trucking sales should show significant increases in 2011 over what
has been generated in the past, as a result of the expected
outcome of long term client demonstrations from several extremely
large new clients will take place during 2011 and 2012.
The Company has been able to generate working capital in the past
through private placements and issuing promissory notes and
believes that these avenues will remain available to the Company
if additional financing is necessary.
FAIRFIELD SENTRY: Two Greenwich Affiliates File Chapter 11 Plans
----------------------------------------------------------------
Kaitlin Ugolik at Bankruptcy Law360 reports that two bankrupt
Fairfield Greenwich Group affiliates that acted as feeder funds
for Bernard L. Madoff's massive Ponzi scheme filed Chapter 11
plans Wednesday in New York incorporating a recent $212 million
settlement with Madoff trustee Irving Picard.
Greenwich Sentry LP, one of the Fairfield Greenwich Group funds
that invested in Madoff's multibillion-dollar Ponzi scheme, says
it will allow Mr. Picard to file a claim in the amount of
$206 million, and Greenwich Sentry Partners LP says it will allow
the trustee to seek $5.9 million, according to Law360.
About Fairfield Sentry
Fairfield Sentry is being liquidated under the supervision of the
Commercial Division of the High Court of Justice in the British
Virgin Islands. It is one of the funds owned by the Fairfield
Greenwich Group, an investment firm founded in 1983 in New York
City. Fairfield Sentry and other Greenwich funds had among the
largest exposures to the Bernard L. Madoff fraud.
Fairfield Sentry Limited filed for Chapter 15 protection (Bankr.
S.D.N.Y. Case No. 10-13164) on June 14, 2010.
Greenwich Sentry, L.P., and an affiliate filed for Chapter 11
protection (Bankr. S.D.N.Y. Case No. 10-16229) on Nov. 19, 2010,
hoping to settle lawsuits filed against it in connection with its
investments with Bernard L. Madoff.
On May 18, 2009, Irving H. Picard, the trustee liquidating the
estate of Mr. Madoff and his firm, Bernard L. Madoff Investment
Securities, LLC, filed a lawsuit against Fairfield Sentry and
Greenwich, seeking the return of US$3.55 billion that Fairfield
withdrew from Madoff during the period from 2002 to Madoff's
arrest in December 2008. Since 1995, the Fairfield funds invested
about US$4.5 billion with BLMIS.
Mr. Picard claims that Fairfield knew or should have known about
the fraud give that it received from BLMIS unrealistically high
and consistent annual returns of between 10% and 21% in contrast
to the vastly larger fluctuations in the S&P 100 Index.
FAIRWAY COMMONS II: Roseville Wants Receiver Excused from Turnover
------------------------------------------------------------------
Roseville Portfolio MSCI 2006-HQ8 LLC, ask the U.S. Bankruptcy
Court for the Eastern District of California for an order (i)
excusing Anthony Dimond, the state court appointed receiver, from
the turnover requirements of Sections 543 (a) and (b)(1) with
respect to certain property owned by Fairway Commons II, LLC,
currently in the possession and control of the receiver; or (ii)
in the alternative, appointing the receiver as the person
responsible for the estate under Rule 9001(5).
As reported in the Troubled Company Reporter on June 30, 2011,
Roseville asked the Court for relief from the automatic stay in
the bankruptcy case of Fairway Commons II so it may issue and
record by July 5, 2011, a trustee's deed upon sale to fully
perfect its ownership interests in certain property previously
owned by Fairway Commons II.
Kobra EFS, in Roseville, California, filed for Chapter 11
bankruptcy (Bankr. E.D. Calif. Case No. 11-35250) on June 20,
2011. Affiliates that also sought Chapter 11 protection are
Fairway Commons II, LLC (Case No. 11-35255) and Eureka Ridge, LLC
(Case No. 11-35256). Judge Christopher M. Klein presides over the
case. Paul A. Warner, Esq., serves as the Debtors' bankruptcy
counsel. Kobra EFS and Fairway Commons II separately estimated
$10 million to $50 million in both assets and debts.
FENTON SUB: Wells Fargo Wants Request to Access Cash Denied
-----------------------------------------------------------
Wells Fargo Bank N.A., asks the U.S. Bankruptcy Court for the
District Of Minnesota to deny approval of Fenton Sub Parcel D LLC
and Bowles Sub Parcel D LLC's request to use the cash collateral.
Wells Fargo serves as trustee for the registered holders of J.P.
Morgan Chase Commercial Mortgage Securities Corp., Commercial
Mortgage Pass-Through Certificates, Series 2004-LN2, by and
through CWCapital Asset Management LLC, as Special Servicer.
As reported in the Troubled Company Reporter on July 18, 2011, the
Debtors sought permission to use cash collateral consisting of
rents in which Wells Fargo Bank, N.A., holds a security interest.
The Debtors will use the cash collateral to continue their
operations and to either reorganize or pursue an asset sale.
The Debtors request final authorization to use cash collateral
through Dec. 31, 2011. They believe that Wells Fargo is
adequately protected by the equity cushion in the real property,
well as the Debtors' continued maintenance of the property.
The original financing was provided by Nomura Credit and Capital,
Inc., in the amount of $11,604,000. The Debtors currently owe
$10,535,364 under the promissory note, which matures May 11, 2014.
The principal on the First Mortgage Debt has been paid down by
over $1 million to date.
According to Wells Fargo, the motion also does not provide the
lender with the indubitable equivalent because it does not protect
the Lender's present interest in the cash collateral or
Prepetition Collateral. The Debtors provide no additional
collateral or cash infusions during the entire six month window of
use of cash collateral.
There is no competent evidence in the record of the value of the
properties to establish the Debtors' claim of an equity cushion.
Instead there is merely an assertion that the properties are worth
$13,135,656.
Wells Fargo is represented by:
WINTHROP & WEINSTINE, P.A.
Michael A. Rosow, Esq.
225 South Sixth Street, Suite 3500
Minneapolis, MN 55402-4629
Tel: (612) 604-6400
PERKINS COIE, LLP
Jeanette L. Thomas, Esq.
1120 NW Couch Street, 10th Floor
Portland, OR 97209
Tel: (503) 727-2000
About Fenton Sub and Bowles Sub
Fenton Sub Parcel D LLC and Bowles Sub Parcel D LLC jointly own
industrial multi-tenant properties located in the Twin Cities.
They are controlled by StoneArch II/WCSE Minneapolis Industrial
LLC. StoneArch is the 100% member of Bowles Subsidiary, LLC and
of Fenton Subsidiary LLC. Bowles Subsidiary LLC is then the 100%
member of Bowles Sub Parcel D LLC, and Fenton Subsidiary LLC is
the 100% member of Fenton Sub Parcel D, LLC.
In 2007, StoneArch acquired various LLCs, which in turn owned 27
industrial multi-tenant properties located in the Twin Cities.
The properties were divided into four separate pools: A, B, C, and
D. Fenton Sub Parcel D and Bowles Sub Parcel D jointly own the
properties in pool D. As tenants in common, Fenton Sub Parcel D
has an undivided 74.5394% interest and Bowles Sub Parcel D has an
undivided 25.4606% interest. The Pool D Properties consist of six
parcels of real property located in Anoka, Dakota, and Hennepin
Counties, Minnesota. The Debtors expect the Pool D Properties to
be worth $13,135,656 as of the Petition Date.
Although they are two separate legal entities, Fenton Sub Parcel D
and Bowles Sub Parcel D have consistently been treated as one
enterprise. Hoyt Properties, Inc., acts as agent in managing the
Pool D Properties.
Fenton Sub Parcel D and Bowles Sub Parcel D filed for Chapter 11
bankruptcy (Bankr. D. Minn. Case Nos. 11-44430 and 11-44434) on
June 29, 2011. The Debtors' petitions were signed by Steven Bruce
Hoyt, chief manager, who is a debtor in bankruptcy case number 11-
43816. He is separately represented by Michael C. Meyer of the
firm Ravich Meyer.
The cases were originally assigned to Judge Dennis D. O'Brien and
reassigned to Judge Robert J. Kressel as the cases are related to
the Hoyt case, which was filed earlier and assigned to Judge
Kressel.
Cynthia A. Moyer, Esq., James L. Baillie, Esq., and Sarah M.
Gibbs, Esq., at Fredrikson & Byron, PA, represent the Debtors.
FIGUEROA TOWER: Asks to Tap Lenders' Cash to Fund Operations
------------------------------------------------------------
Dow Jones' DBR Small Cap reports that the owners of Los Angeles's
Figueroa Tower are requesting court permission to use crucial
operating funds as it works to restructure in the Chapter 11 case
it filed to prevent a receiver taking control of its commercial
office building.
Milbank Real Estate's Figueroa Tower skyscraper is the fourth of
the real-estate investor's trophy commercial properties to enter
Chapter 11 in recent years.
Figueroa Tower I LP, along with two affiliates, sought Chapter 11
protection (Bankr. C.D. Calif. Case No. 11-40231) on July 14,
2011. David L. Neale, Esq., at Levene Neale Bender Rankin & Brill
LLP, in Los Angeles, California, serves as counsel. The Debtor
estimated assets and debts of $50,000,001 to $100,000,000 as of
the Chapter 11 filing.
FIRST FEDERAL: Reincorporates to State of Arkansas
---------------------------------------------------
First Federal Bancshares of Arkansas, Inc., on July 20, 2011,
completed its reincorporation from the State of Texas to the State
of Arkansas. The reincorporation was accomplished pursuant to a
plan of conversion, which was approved by the shareholders of the
Company on June 22, 2011, a full-text copy of which is available
for free at http://is.gd/42FEM6
The reincorporation of the Company did not result in any change in
the name, business, management, fiscal year, accounting, location
of the principal executive officers, assets or liabilities of the
Company. In addition, the Company's common stock will continue to
trade on the NASDAQ Global Market under the symbol "FFBH."
Shareholders are not required to exchange Company shares in
connection with the reincorporation since shares in the Texas-
incorporated Company are deemed to represent an equal number of
shares in the Arkansas-incorporated Company.
As of July 20, 2011, the effective date of the reincorporation,
the rights of the Company's shareholders began to be governed by
the Arkansas Business Corporation Act, the articles of
incorporation of the Arkansas-incorporated Company and the bylaws
of the Arkansas-incorporated Company.
About First Federal Bancshares of Arkansas
First Federal Bancshares of Arkansas, Inc. (NASDAQ GM:FFBH) --
http://www.ffbh.com/-- is a unitary savings and loan holding
company for First Federal Bank, a community bank serving consumers
and businesses with a full range of checking, savings, investment
and loan products and services. The Bank, founded in 1934,
conducts business from 20 full-service branch locations, one
stand-alone loan production office, and 30 ATMs located in
Northcentral and Northwest Arkansas.
The Company reported a net loss of $4.03 million on $29.82 million
of total interest income for the year ended Dec. 31, 2010,
compared with a net loss of $45.49 million on $36.04 million in
total interest income during the prior year.
The Company's balance sheet at March 31, 2011, showed $577.67
million in total assets, $542.88 million in total liabilities and
$34.79 million in total stockholders' equity.
BKD, LLP expressed substantial doubt about the bank holding
company's ability to continue as a going concern. The accounting
firm noted that the Company has experienced significant losses in
recent years and has significant levels of nonperforming assets.
Furthermore, the Company has entered into a written agreement with
the Office of Thrift Supervision which requires the Company to
meet certain capital requirements by Dec. 31, 2010, which were not
met.
FIRST MARINER: To Appeal NASDAQ's Delisting Determination
---------------------------------------------------------
First Mariner Bancorp requested a hearing in order to appeal
NASDAQ Stock Market's delisting determination, which hearing
request will delay the delisting of the Company's securities
pending the decision of a NASDAQ Hearings Panel.
The Company, on July 15, 2011, received a letter from The NASDAQ
notifying the Company that NASDAQ has determined not to approve
the Company's request for continued listing on the Nasdaq Capital
Market. This notification has no effect on the listing of the
Company's securities at this time.
On May 18, 2011, NASDAQ notified the Company that it did not meet
the listing requirement to maintain a minimum of $2,500,000 in
stockholders' equity set forth in NASDAQ Listing Rule 5550(b)(1).
In addition, the Company did not meet the market value of listed
securities or net income from continued operations alternatives of
the Listing Rule.
About First Mariner
Headquartered in Baltimore, Maryland, First Mariner Bancorp
-- http://www.1stmarinerbancorp.com/-- is a bank holding company
whose business is conducted primarily through its wholly owned
operating subsidiary, First Mariner Bank, which is engaged in the
general general commercial banking business. First Mariner was
established in 1995 and has total assets in excess of $1.3 billion
as of Dec. 31, 2010.
The Company's balance sheet at March 31, 2011, showed
$1.266 billion in total assets, $1.269 billion in total
liabilities, and a stockholders' deficit of $3.3 million.
"Quantitative measures established by regulation to ensure capital
adequacy require the [First Mariner] Bank to maintain minimum
amounts and ratios of total and Tier I capital to risk-weighted
assets, and of Tier I capital to average quarterly assets," the
Company said in the filing. "As of March 31, 2011, the Bank was
"under-capitalized" under the regulatory framework for prompt
corrective action."
As reported in the TCR on April 4, 2011, Stegman & Company, in
Baltimore, expressed substantial doubt about First Mariner
Bancorp's ability to continue as a going concern, following the
Company's 2010 results. The independent auditors noted that the
Company has suffered recurring losses and has a limited capital
base.
FLEXERA SOFTWARE: S&P Puts 'B+' Corp. Rating on Watch Negative
--------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'B+' corporate
credit rating on Schaumburg, Ill.-based Flexera Software Inc. on
CreditWatch with negative implications. "We expect to withdraw our
ratings on the existing credit facilities at the close of the
transaction following the refinancing," S&P related.
The CreditWatch listing follows the announcement that Teachers'
Private Capital, the private investment arm of the Ontario
Teachers' Pension Plan, will acquire a majority interest in
Flexera. Thoma Bravo, the current investor in Flexera, is expected
to retain a minority interest in the company post closing of the
transaction.
"Terms have yet to be disclosed but we anticipate that the
existing debt will be refinanced and we are likely to withdraw our
ratings on these issues as a result of the change of control," S&P
said.
"Although no terms have been announced, based on Flexera's
relatively modest revenue and EBITDA base, we believe that the
incremental debt from the transaction could potentially weaken the
company's credit profile, depending on the amount of incremental
debt," explained Standard & Poor's credit analyst Andrew Chang.
Adjusted debt to EBITDA was about 4.3x in March 2011.
"We will resolve the CreditWatch when more information regarding
the above transaction and financing becomes available and we have
the opportunity to review any potential changes in business or
financial strategies," S&P stated.
FRED LEIGHTON: Former Owner Gets 6 Years for $20-Mil. Fraud
-----------------------------------------------------------
Richard Vanderford at Bankruptcy Law360 reports that U.S. District
Judge Denise Cote on Friday sentenced former Fred Leighton
Holdings Inc. owner Ralph Esmerian to 72 months in prison for
misleading a bankruptcy court and defrauding creditor Merrill
Lynch & Co. Inc. of $20 million as his business collapsed.
Judge Cote said that for the three years before his arrest,
Mr. Esmerian, a jewelry dealer and New York art patron, "lived a
life of fraud and deceit on a massive scale," Law360 says.
About Fred Leighton
Fred Leighton Holding, Inc. -- http://www.fredleighton.com/-- is
a New York-based jewelry retailer owned by Ralph O. Emerian. Fred
Leighton has decked countless red-carpet-dwellers in diamonds,
including Sarah Jessica Parker, Nicole Kidman, and Catherine Zeta-
Jones.
Fred Leighton and its affiliates filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code on April 15, 2008
(Bankr. S.D.N.Y., Case No. 08-11363). Joshua Joseph Angel, Esq.,
and Frederick E. Schmidt, Esq., at Herrick, Feinstein LLP, in New
York, represent the Debtors. The Official Committee of Unsecured
Creditors has retained Michael Z. Brownstein, Esq., and Rocco A.
Cavaliere, Esq., at Blank Rome LLP, as counsel. Fred Leighton
disclosed total assets of $128,551,467 and total liabilities of
$134,814,367 in its schedules.
The Bankruptcy Court approved in November 2009 the sale of Fred
Leighton Holding Inc.'s business operations for $25.8 million in
cash to investors including a group of private equity firms and
estate jewelry seller Windsor Jewelers Inc.
FUSION TELECOMMUNICATIONS: Borrows $100,000 from Marvin Rosen
-------------------------------------------------------------
Fusion Telecommunications International, Inc., on July 14, 2011,
borrowed $100,000 from Marvin S Rosen, a Director of the Company.
This note (a) is payable on demand in full upon ten days notice of
demand from the lender, (b) bears interest on the unpaid principal
amount at the rate of 3.25% per annum, and (c) grants the lender a
collateralized security interest, pari passu with other lenders,
in the Company's accounts receivable. The proceeds of this note
are to be used primarily for general corporate purposes.
About Fusion Telecommunications
New York City-based Fusion Telecommunications International, Inc.
(OTC BB: FSNN) is a provider of Internet Protocol ("IP") based
digital voice and data communications services to corporations and
carriers worldwide.
As reported by the TCR on April 26, 2011, Rothstein, Kass &
Company, P.C., in Roseland, New Jersey, expressed substantial
doubt about Fusion Telecommunications' ability to continue as a
going concern. The independent auditors noted that the Company
the Company has negative working capital balances, incurred
negative cash flows from operations and net losses since
inception, and has limited capital to fund future operations.
Fusion Telecommunications reported a net loss of $5.8 million on
$41.8 million of revenues for 2010, compared with a net loss of
$9.6 million on $40.9 million of revenues for 2009.
The Company's balance sheet at March 31, 2011, showed
$4.42 million in total assets, $13.55 million in total
liabilities, and a $9.12 million total stockholders' deficit.
GATEHOUSE MEDIA: Bank Debt Trades at 65% Off in Secondary Market
----------------------------------------------------------------
Participations in a syndicated loan under which GateHouse Media,
Inc., is a borrower traded in the secondary market at 34.77 cents-
on-the-dollar during the week ended Friday, July 22, 2011, a drop
of 00.43 percentage points from the previous week according to
data compiled by Loan Pricing Corp. and reported in The Wall
Street Journal. The Company pays 200 basis points above LIBOR to
borrow under the facility. The bank loan matures on Feb. 27,
2014, and carries Moody's Ca rating and Standard & Poor's CCC-
rating. The loan is one of the biggest gainers and losers among
208 widely quoted syndicated loans with five or more bids in
secondary trading for the week ended Friday.
About GateHouse Media
GateHouse Media, Inc. -- http://www.gatehousemedia.com/--
headquartered in Fairport, New York, is one of the largest
publishers of locally based print and online media in the United
States as measured by its 97 daily publications. GateHouse Media
currently serves local audiences of more than 10 million per week
across 21 states through hundreds of community publications and
local Web sites.
The Company reported a net loss of $26.64 million on $558.58
million of total revenue for the year ended Dec. 31, 2010,
compared with a net loss of $530.61 million on $584.79 million of
total revenue for the year ended Dec. 31, 2009.
The Company's balance sheet at Dec. 31, 2010, showed $546.32
million in total assets, $1.33 billion in total liabilities, and a
$792.12 million stockholders' deficit.
GENTIVA HEALTH: Bank Debt Trades at 0.9% Off in Secondary Market
----------------------------------------------------------------
Participations in a syndicated loan under which Gentiva Health
Services, Inc., is a borrower traded in the secondary market at
99.10 cents-on-the-dollar during the week ended Friday, July 22,
2011, a drop of 0.15 percentage points from the previous week
according to data compiled by Loan Pricing Corp. and reported in
The Wall Street Journal. The Company pays 350 basis points above
LIBOR to borrow under the facility. The bank loan matures on Aug.
17, 2016, and carries Moody's Ba2 rating and Standard & Poor's BB-
rating. The loan is one of the biggest gainers and losers among
208 widely quoted syndicated loans with five or more bids in
secondary trading for the week ended Friday.
About Gentiva Health
Gentiva Health Services, Inc. -- http://www.gentiva.com/-- is a
leading provider of home health and hospice services in the U.S.
The company offers direct home nursing and therapies, including
specialty programs, as well as hospice care. Gentiva reported
revenues of over $1 billion for the twelve months ended April 4,
2010.
As reported by the Troubled Company Reporter on March 24, 2011,
Standard & Poor's Rating Services said that it reinstated ratings
on Gentiva Health Services Inc.'s senior secured credit facility.
The issue-level ratings are 'BB-' (one notch higher than the
corporate credit rating) with a recovery rating of '2'. The '2'
recovery rating indicates expectations for substantial (70%-90%)
recovery of principal in the event of default.
On March 9, 2011, Gentiva refinanced its credit facility, reducing
the amount if its term loan A to $180 million from $200 million
and its term loan B to $546.6 million from $550 million. The
amount of the revolving credit facility remained $125 million.
The company negotiated more favorable pricing and relaxed the
interest coverage covenant. The maturity dates and amortization
schedule remained the same.
The 'B+' corporate credit rating on Gentiva remains unchanged.
GENWORTH MORTGAGE: S&P Cuts Counterparty Credit Rating to 'BB-'
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its counterparty credit
and financial strength ratings, as applicable, on Genworth
Mortgage Insurance Corp. and Genworth Residential Mortgage
Insurance Corp. of North Carolina (collectively referred to as
GMICO) to 'BB-' from 'BB+'. Standard & Poor's also said that it
affirmed its 'BBB' counterparty credit rating on the holding
company, Genworth Financial Inc. (GNW). The outlook remains
negative.
For three of the past four quarters, GNW has announced reserve
strengthening in its U.S. mortgage insurance operations segment.
"These actions significantly increased the company's incurred
losses, resulting in pretax losses that went beyond our
expectations for the segment," said Standard & Poor's credit
analyst Jeremy Rosenbaum. "The loss ratio was elevated at 263%,
457%, 197%, and an estimated 367% for the past four quarters. The
risk-to-capital ratio is now estimated to be above the 25 to 1
benchmark. Further, GMICO bolstered its capital with two
affiliated share exchanges (most recently, $375 million of
Genworth MI Canada Inc. [MIC]), which amount to nearly $600
million and lowers the quality of capital in our opinion."
However, there were certain positive elements in the second-
quarter 2011 prerelease. GMICO's loss mitigation efforts continue
to track towards its expectations for full-year 2011 and the
delinquency rate on its flow business continues to be one of the
lowest in the mortgage insurance industry. On a reserve-per-
delinquency basis, GMICO now has one of the highest reserve levels
in the industry, which indicates that perhaps the worst is behind
the company. GMICO's new notices continue to decline and are at
the lowest level since 2007, which has led to a 30% reduction in
its delinquency inventory since fourth-quarter 2009.
The outlook on GNW remains negative following GNW's second quarter
preearnings release. While management continues to utilize GNW's
internal financial flexibility (other than the cash on hand at the
holding company) to support GMICO, as exemplified by the execution
of another share exchange in the second quarter, GNW plans to
maintain a 2x interest expense cash buffer of $500 million for the
next two years.
"GNW's coverage metrics continue to remain below what we expect
for the rating level and haven't rebounded as sharply as we had
anticipated due to poor performance at GMICO," said Mr. Rosenbaum.
However, GNW has a limited amount of near-term maturities and the
company currently has a high cash balance. Standard & Poor's would
likely lower the rating on the holding company by one notch if its
cash buffer declines below $500 million or if GNW's statutory
dividend coverage declines below the current level of about 2x. In
addition, Standard & Poor's could lower the rating if further
deterioration in GMICO hinders GNW's external financial
flexibility. Further MIC contributions to GMICO could reduce the
dividends available to the holding company.
"The negative outlook on GMICO reflects uncertain macroeconomic
conditions and the potential for further adverse reserve
development," said Mr. Rosenbaum. Although new delinquencies have
declined in recent quarters, delinquencies likely would increase
again if the economy enters another downturn and the unemployment
rate increases.
Standard & Poor's could lower the ratings on GMICO if the company
experiences a setback resulting in higher delinquencies or losses
that impairs its capital and claims paying ability. Standard &
Poor's could also lower the ratings if GMICO's future results
reflect further significant reserve strengthening and calls the
company's reserve adequacy into question.
GIBRALTAR INDUSTRIES: Moody's Affirms 'B1' CFR; Outlook Stable
--------------------------------------------------------------
Moody's Investors Service affirmed the B1 corporate family and
probability of default ratings for Gibraltar Industries, Inc. and
revised the outlook to stable from negative. In a related rating
action, the company's senior secured revolving credit facility was
upgraded to Ba2 from Ba3 and its senior subordinated notes were
upgraded to B2 from B3. The stabilization of the outlook reflects
the company's ability to reduce debt and generate strong positive
free cash flow, even through the economic downturn and despite
commodity price volatility. In addition, cost reduction measures
have resulted in slightly improved, albeit weak, operating
margins. Gibraltar's SGL-3 speculative grade liquidity rating was
affirmed.
RATINGS RATIONALE
Moody's views Gibraltar's ability to reduce balance sheet debt by
more than 50% over the past 3 years while continuing to generate
strong free cash flow as the primary catalysts behind the
stabilization of the outlook. At March 31, 2011, the company's
adjusted free cash flow to debt stood at 10.5%, which is high
considering the B1 corporate family rating. Through cost cutting
initiatives that included closing and/or consolidating
approximately 30 facilities, as well as price increases, Gibraltar
has been able to partially offset the increase in raw materials
costs, particularly steel. Although adjusted EBIT margin remains
low at 2.6% for the twelve months ended March 31, 2011, this does
not reflect the full impact of the cost reduction measures. For
the first quarter of 2011, adjusted EBIT margin was 5.0%, which is
an improvement over the low of 1.9% for the full year in 2010.
Moody's acknowledges that Gibraltar's heavy exposure to the
residential and non-residential construction sectors will continue
to pressure operating performance over the intermediate term.
However, the company's efforts to streamline its operations and
divest non-core, lower margin businesses will help prevent further
deterioration in credit metrics during the next 12 to 18 months.
These rating actions were taken:
- B1 corporate family rating affirmed;
- B1 probability of default affirmed
$200 million senior secured revolver due February 2012 upgraded to
Ba2 (LGD2, 20% ) from Ba3 (LGD3, 34%);
- $204 million senior subordinated notes due December 2015
upgraded to B2 (LGD5, 74%) from B3 (LGD5, 85%);
Headquartered in Buffalo, NY, Gibraltar Industries is a
manufacturer and distributor of metals and other engineered
products for residential and non-residential construction markets.
Gibraltar is North America's leading roof and foundation
ventilation product manufacturer and mailbox manufacturer.
The principal methodology used in rating Gibraltar Industries, Inc
was the Global Manufacturing Industry Methodology published in
December 2010. Other methodologies used include Loss Given Default
for Speculative-Grade Non-Financial Companies in the U.S., Canada
and EMEA published in June 2009 (and/or) the Government-Related
Issuers methodology published in July 2010.
GLOBAL DIVERSIFIED: Deregisters Unsold Securities
-------------------------------------------------
Global Diversified Industries, Inc., filed with the U.S.
Securities and Exchange Commission Post-Effective Amendments to
Form S-8 registration statements to deregister shares of its
common stock that were registered with the SEC but were not sold
under the registration statements.
About Global Diversified
Chowchilla, Calif.-based Global Diversified Industries, Inc., is a
holding company for two wholly owned subsidiaries, Lutrex
Enterprises, Inc., an entity which holds equipment and inventory
for the Company, and Global Modular, Inc., an entity which
provides sales, marketing, manufacturing and construction site
work of modular type structures.
The Company's balance sheet at Jan. 31, 2011 showed $15.30 million
in total assets, $10.60 million in total liabilities $9.14 million
in net preferred stock series D, $1.75 million in net preferred
stock series C, $3.04 million in net preferred stock series B, and
a $9.23 million total stockholders' deficit.
Going Concern
The Company has reoccurring losses and has generated negative cash
flows from operations which raises substantial doubts about the
Company's ability to continue as a going concern. The
continuation of the Company as a going concern is dependent upon
the continued financial support from its shareholders and
creditors and the ability of the Company to obtain necessary
equity financing to continue operations, and the attainment of
profitable operations. The Company plans to implement the
following policies to help alleviate the going concern issue
during the year ended April 30, 2011:
* Raise additional money through the sale of equity securities
and convertible instruments through our funding sources which
provided the Company with over $6,000,000 of funding during
the year ended April 30, 2010.
* Some of the Company's preferred shareholders have redeemed
their preferred stock and warrants prior to Jan. 31, 2011.
* Focus on revenue generation, during the current year the
Company spent a great deal of time acquiring discounted
inventory and planning for possible acquisitions, during the
year ended April 30, 2011 the Company plans to focus on
revenue generation.
* The Company believes its backlog at Jan. 31, 2011 will be
recognizable and will provide a substantial improvement to
earnings during the year ended April 30, 2011 and should
decrease our dependence on the sale of equity and other
instruments
The Company said there can be no assurance that it will be
successful at implementing the above plans, failure to implement
these plans could have a material impact on itself.
GOLDEN ELEPHANT: Reports $37,500 Net Income in Sept. 30 Quarter
---------------------------------------------------------------
Golden Elephant Glass Technology, Inc., reported net income of
$37,496 for the three months ended Sept. 30, 2010, compared with a
net loss of $1.90 million for the same period of 2009.
For the three months ended Sept. 30, 2010, and the three months
ended Sept. 30, 2009, the Company did not generate any sales
revenue, because it has suspended its operations since
November 2008 as a result of the global economic recession and
since then has commenced only equipment maintenance and system
upgrades.
The decrease in net loss was a result of the recovery of bad debt
for an amount of approximately $3.13 million.
Net loss was $2.51 million on $0 revenue for the nine months ended
Sept. 30, 2010, compared with a net loss of $6.79 million on
$2.27 million of sales revenues for the comparable period of 2009.
The Company's balance sheet at Sept. 30, 2010, showed
$35.44 million in total assets, $34.36 million in total
liabilities, and stockholders' equity of $1.08 million.
As reported in the troubled Company Reporter on Dec. 28, 2010,
NW Pacific CPA, LLC, in Newcastle, Washington, expressed
substantial doubt about Golden Elephant's ability to continue as a
going concern, following the Company's results for the fiscal year
ended Dec. 31, 2009. The independent auditors noted that the
Company has accumulated deficits of $11,561,769 at Dec. 31, 2009,
and also has a working capital deficiency of $22,362,695 as of
Dec. 31, 2009.
A copy of the Form 10-Q is available at http://is.gd/hjzmKY
Golden Elephant Glass Technology, Inc., is a China-based float
glass manufacturer. The Company's product offerings include float
glass, ultra-clear glass (also called crystal glass), colored
float glass and high grade, glass processed products such as
mirrors, glass artwork, tempered glass, insulated glass, laminated
glass, lacquered glass and similar products. The Company's
production facility is located in Fuxin City, Liaoning Province,
China and sold to end users in China, Asia, Europe, South America
and South Africa.
GORDON PROPERTIES: Court Rules on Condo Owners' Claim
-----------------------------------------------------
Bankruptcy Judge Robert G. Mayer ruled on the motions for summary
judgment filed by Gordon Properties LLC and by First Owners'
Association of Forty Six Hundred Condominium, Inc., to the
debtor's objection to the association's proof of claim. A copy of
Judge Mayer's July 21, 2011 Memorandum Opinion is available at
http://is.gd/X1ckSmfrom Leagle.com.
The case is Gordon Properties, LLC, v. First Owners' Association
of Forty Six Hundred Condominium, Inc., Case No. 09-18086 (Bankr.
E.D. Va.).
About Gordon Properties
Based in Alexandria, Va., Gordon Properties LLC owns 40
condominium units in a high-rise apartment building with both
residential and commercial units and two commercial units adjacent
to the high-rise building. The Debtor's ownership of these condos
represents about a 20% interest in the Forty Six Hundred
Condominium -- http://foa4600.org/-- project in Alexandria, Va.
One of the adjacent commercial units, a restaurant, is also owned
by the debtor. Gordon Properties sought Chapter 11 protection on
Oct. 2, 2009 (Bankr. E.D. Va. Case No. 09-18086), and is
represented by Donald F. King, Esq., at Odin, Feldman & Pittleman
PC in Fairfax, Va. The Debtor disclosed $11,149,458 in assets and
$1,546,344 in liabilities in its Schedules of Assets and
Liabilities.
GSC GROUP: Judge Won't Speed Up Challenge to $235 Million Sale
--------------------------------------------------------------
Eric Hornbeck at Bankruptcy Law360 reports that a New York federal
judge on Friday refused to fast-track minority lenders' opposition
to the $235 million sale of bankrupt investment management firm
GSC Group Inc.'s assets to Black Diamond Capital Management LLC.
Law360 relates that U.S. District Judge Laura Taylor Swain ruled
that even though minority lenders had blasted Black Diamond for
allegedly structuring the deal to greatly benefit itself at their
expense, the lenders' allegations are already pending in a
separate state court suit so there won't be irreparable harm
without an expedited appeal of the sale order.
About GSC Group
Florham Park, New Jersey-based GSC Group, Inc. --
http://www.gsc.com/-- is a private equity firm specializing in
mezzanine and fund of fund investments. Originally named
Greenwich Street Capital Partners Inc. when it was a subsidiary of
Travelers Group Inc., GSC became independent in 1998 and at one
time had $28 billion of assets under management. Market reverses,
termination of some funds, and withdrawal of customers'
investments reduced funds under management at the time of
bankruptcy to $8.4 billion.
GSC Group filed for Chapter 11 bankruptcy protection (Bankr.
S.D.N.Y. Case No. 10-14653) on Aug. 31, 2010. Michael B. Solow,
Esq., at Kaye Scholer LLP, serves as the Debtor's bankruptcy
counsel. Epiq Bankruptcy Solutions, LLC, is the Debtor's notice
and claims agent. Capstone Advisory Group, LLC, is the Debtor's
financial advisor. The Debtor estimated its assets at $1 million
to $10 million and debts at $100 million to $500 million as of the
Chapter 11 filing.
Since Jan. 7, 2011, the Debtors have been operated by James L.
Garrity Jr., as Chapter 11 trustee for the Debtors. No committee
of unsecured creditors has been appointed in the Chapter 11 Cases.
GUIDED THERAPEUTICS: Inks Preliminary Research Pact with Konica
---------------------------------------------------------------
Guided Therapeutics, Inc., has entered into a preliminary
agreement with Konica Minolta Opto, Inc., of Tokyo, to conduct
clinical and market research for the LuVivaTM Advanced Cervical
Scan product in certain Asian markets. As part of the agreement,
the two companies also plan to conduct a clinical trial to
establish screening claims for LuViva, as a method to replace the
Pap test for early cervical disease detection in international
markets.
"We are very pleased to expand our relationship with Konica
Minolta beyond our work on esophageal cancer detection and
monitoring technology," said Mark L. Faupel, Ph.D., President and
CEO of Guided Therapeutics, Inc. "In addition to gaining an
excellent potential marketing partner in Asia, of equal importance
is the initiation of a clinical trial to establish screening
claims for cervical disease for our non-invasive, point-of-care
test. The prospect of opening up the cervical screening market
for our product would expand the market opportunity for LuViva
exponentially."
"We are pleased to extend our relationship with Guided
Therapeutics to cervical disease for the Asian market," said Akira
Suzuki, General Manager, LC Business Department for Konica Minolta
Opto. "We believe that LuViva will bring better healthcare
benefits to women in both highly sophisticated markets, such as
Singapore, and developing countries in Asia as well."
Under the initial one year agreement, Guided Therapeutics will
sell LuViva demonstration and clinical trial devices and single-
use disposable Cervical Guides to Konica Minolta. The screening
clinical trial, sponsored by Konica Minolta, is planned to be
conducted in key Asian markets. Konica Minolta is also
responsible for receiving clearances or approvals for LuViva in
certain Asian countries, not including South Korea. Once each
clearance is granted, Konica Minolta will have right of first
negotiation for distribution of LuViva in that territory.
"In multiple clinical studies involving more than 3,000 women, the
LuViva has consistently demonstrated superior performance to the
standard of care, including the Pap test, human papillomavirus
(HPV) testing and biopsy," Dr. Faupel added.
About Konica Minolta Opto
Konica Minolta Opto, Inc., was inaugurated on Oct. 1, 2003,
following the integration of the former Konica Opto Corporation
and the optics division, parented by the optical system operations
of the former Minolta Co., Ltd. The Company's scope of business
can be roughly divided into two categories: optical product
development centered on the Company's proprietary, cutting-edge
optical technology; and the development and manufacturing of
electronic components, including triacetyl-cellulose (TAC) films
for use in LCD polarizing plates and glass dry plates used for
production of shadow masks. Parent company Konica Minolta
Holdings markets several medical devices, including digital
mammography, and has over 1,000 medical device sales personnel in
Asia. Visit www.konicaminolta.com/opt/index.html for more
information.
About Guided Therapeutics
Guided Therapeutics, Inc. (OTC BB and OTC QB: GTHP)
-- http://www.guidedinc.com/-- is developing a rapid and painless
test for the early detection of disease that leads to cervical
cancer. The technology is designed to provide an objective result
at the point of care, thereby improving the management of cervical
disease. Unlike Pap and HPV tests, the device does not require a
painful tissue sample and results are known immediately. GT has
also entered into a partnership with Konica Minolta Opto to
develop a non-invasive test for Barrett's Esophagus using the
LightTouch technology platform.
The Company reported a net loss of $2.84 million on $3.36 million
of contract and grant revenue for the year ended Dec. 31, 2010,
compared with a net loss of $6.21 million on $1.55 million of
contract and grant revenue during the prior year.
The Company's balance sheet at March 31, 2011, showed
$3.13 million in total assets, $2.36 million in total liabilities
and $777,000 in total stockholders' equity.
As reported by the TCR on April 4, 2011, UHY LLP, in Atlanta,
Georgia, noted that the Company's recurring losses from
operations, accumulated deficit and lack of working capital raise
substantial doubt about its ability to continue as a going
concern.
GULFSTREAM INT'L: Creditors File Chapter 11 Plan
------------------------------------------------
Hilary Russ at Bankruptcy Law360 reports that creditors of
Gulfstream International Group Inc. filed their Chapter 11 plan
and disclosure statement Wednesday calling for the distribution to
claimholders of the entire $600,000 from Gulfstream's asset sale
to a private equity group this year.
The Plan, put forward by the official committee of secured
creditors, calls for the individual debtors' estates to be
consolidated and a liquidation trustee to distribute the sale
proceeds and an additional $25,000 left over from a carve-out
settlement with lender SAH-VUL Strategic Partners, Law360 says.
About Gulfstream International
Fort Lauderdale, Florida-based Gulfstream International Airlines
(NYSE Amex: GIA) operated a fleet of turboprop Beechcraft 19000
aircraft, and specialized in providing travelers with access to
niche locations not typically covered by major carriers. GIA
operated more than 150 scheduled flights per day, serving nine
destinations in Florida, 10 destinations in the Bahamas, five
destinations from Continental Airline's hub under the Department
of Transportation's Essential Air Service Program and supports
charter service to Cuba through a services agreement with
Gulfstream Air Charter, Inc., an entity otherwise unrelated to the
Debtors. GIA operated as a Continental Connection carrier, as
well as for United Airlines, Northwest Airlines and Copa Airlines,
through code share agreements. GIA has 620 employees, including
530 working full-time.
Gulfstream International Group, Inc., and its units including
Gulfstream International Airline, Inc., filed for Chapter 11
bankruptcy protection (Bankr. S.D. Fla. Lead Case No. 10-44131) on
Nov. 4, 2010. Brian K. Gart, Esq., at Berger Singerman, P.A.,
serves as the Debtors' bankruptcy counsel. Jetstream Aviation
Capital, LLC and Jetstream Aviation Management, LLC, serve as
financial advisors to the Debtors. Robert A. Schatzman, Esq.,
Steven J. Solomon, Esq., and Frank P. Terzo, Esq., at
GrayRobinson, P.A., in Miami, Florida, serve as counsel to the
Official Committee of Unsecured Creditors.
Gulfstream International Airlines disclosed $15,967,096 in total
assets and $25,243,099 in total liabilities.
Victory Park provided Gulfstream with up to $5 million debtor-in-
possession financing to fund the Chapter 11 case.
HARDAGE HOTELS: Unable to Confirm Any Plan; Ch. 11 Case Dismissed
-----------------------------------------------------------------
The Hon. Brendan Linehan Shannon of the U.S. Bankruptcy Court for
the District of Delaware dismissed the Chapter 11 case of Hardage
Hotels II, L.P.
The Debtor related that with the appointment of the receiver, the
relisting of the property for foreclosure, its loss of all cash
and future income from its assets, and its inability to obtain
confirmation of any plan, it is in the interest of the Debtor's
estate and creditors that the case is dismissed.
Rockville, Maryland-based Hardage Hotels II, L.P., dba Chase Suite
Hotel - Rockville, filed for Chapter 11 bankruptcy protection
(Bankr. D. Del. Case No. 11-10518) on Feb. 22, 2011. Bruce
Grohsgal, Esq., at Pachulski, Stang, Ziehl Young & Jones, serves
as the Debtor's bankruptcy counsel. The Debtor estimated its
assets and debts at $10 million to $50 million. Affiliate Hardage
Hotels VIII, LLC, filed a separate Chapter 11 petition on Jan. 21,
2011 (Bankr. D. Del. Case No. 11-10210). The Company disclosed
$9,558,642 in assets and $11,931,607 in liabilities as of the
Chapter 11 filing.
HAWKER BEECHCRAFT: Bank Debt Trades at 17% Off in Secondary Market
------------------------------------------------------------------
Participations in a syndicated loan under which Hawker Beechcraft
is a borrower traded in the secondary market at 82.63 cents-on-
the-dollar during the week ended Friday, July 22, 2011, an
increase of 0.25 percentage points from the previous week
according to data compiled by Loan Pricing Corp. and reported in
The Wall Street Journal. The Company pays 200 basis points above
LIBOR to borrow under the facility. The bank loan matures on
March 26, 2014, and carries Moody's 'Caa1' rating and Standard &
Poor's 'CCC+' rating. The loan is one of the biggest gainers and
losers among 208 widely quoted syndicated loans with five or more
bids in secondary trading for the week ended Friday.
About Hawker Beechcraft
Hawker Beechcraft Acquisition Company, LLC, headquartered in
Wichita, Kan., is a manufacturer of business jets, turboprops and
piston aircraft for corporations, governments and individuals
worldwide.
The Company's balance sheet at March 31, 2011, showed $3.121
billion in total assets, $3.396 billion in total liabilities, and
deficit of $275.5 million.
Hawker Beechcraft reported a net loss of $304.3 million on $2.80
billion of total sales for 12 months ended Dec. 31, 2010. Net
loss in 2009 and 2008 was $451.3 million and $157.2 million,
respectively.
To reduce the cost of operations, in October 2010, the Company
announced it would implement a cost reduction and productivity
program. The first part of the program consisted of the immediate
termination of approximately 8% of salaried employees while the
second part involves reducing the Company's factory and shop work
forces by approximately 800 employees by end of August 2011.
* * *
Hawker Beechcraft carries 'Caa2' corporate family and probability
of default ratings from Moody's Investors Service.
HELLER EHRMAN: Reaches $5-Mil. Deal With Covington Over Transfers
-----------------------------------------------------------------
Kaitlin Ugolik at Bankruptcy Law360 reports that Heller Ehrman LLP
on Tuesday reached a nearly $5 million settlement in California
with Covington & Burling LLP and a group of former Heller
intellectual property lawyers accused of breaching their
employment contracts when they transferred to Covington after
Heller filed for bankruptcy.
Under the settlement, Covington will pay $4 million, or about 10%
of the $40 million in attorneys' fees it estimated it had received
as a result of taking over Heller's business through 2010, Law360
says.
About Heller Ehrman
Headquartered in San Francisco, California, Heller Ehrman, LLP
-- http://www.hewm.com/-- was an international law firm of more
than 730 attorneys in 15 offices in the United States, Europe, and
Asia.
Heller Ehrman filed a voluntary Chapter 11 petition (Bankr. N.D.
Calif., Case No. 08-32514) on Dec. 28, 2008. Members of the
firm's dissolution committee led by Peter J. Benvenutti approved a
plan dated Sept. 26, 2008, to dissolve the firm. The Hon.
Dennis Montali presides over the case. Pachulski Stang Ziehl &
Jones LLP assists the Debtor in its restructuring effort. The
Official Committee of Unsecured Creditors is represented
Felderstein Fitzgerald Willoughby & Pascuzzi LLP. The firm
estimated assets and debts at $50 million to $100 million as of
the Petition Date. According to reports, the firm had roughly $63
million in assets and 54 employees at the time of its filing. The
Court confirmed Heller Ehrman's Plan of Liquidation in September
2010.
HORIZON LINES: Extends Subscription Deadline to Aug. 5
------------------------------------------------------
Horizon Lines, Inc., on July 22, 2011, entered into a sixth
amendment with certain holders of a majority of its unsecured
4.25% convertible senior notes due 2012, to the announced
Restructuring Support Agreement, dated June 1, 2011, as amended.
The Amendment was entered into to extend, from July 22, 2011, to
Aug. 5, 2011, (i) the deadline by which the Company is to receive
subscription commitments from the Exchanging Holders and (ii) the
Exchanging Holders' and the Company's continued support for the
recapitalization and to allow the parties to discuss certain
modifications to the terms of the recapitalization. A full-text
copy of the Amendment is available for free at
http://is.gd/nVSAOZ
About Horizon Lines
Horizon Lines, Inc., based in Charlotte, North Carolina, through
its wholly-owned indirect operating subsidiary, Horizon Lines,
LLC, currently operates 11 of its 15 Jones Act qualified U.S.
flag container ships in Jones Act liner services between the
continental United States and either Alaska, Hawaii, or Puerto
Rico and five U.S. flag container ships between the Far East,
U.S. west coast and Guam.
Horizon Lines reported a net loss of $57.97 million on
$1.16 billion of operating revenue for the fiscal year ended
Dec. 26, 2010, compared with a net loss of $31.27 million on
$1.12 billion of operating revenue for the fiscal year ended
Dec. 20, 2009.
The Company's balance sheet at March 27, 2011, showed
$804.0 million in total assets, $797.3 million in total
liabilities, and stockholders' equity of $6.66 million.
As reported in the TCR on March 30, 2011, Ernst & Young LLP, in
Charlotte, North Carolina, expressed substantial doubt about
Horizon Lines' ability to continue as a going concern, following
the Company's 2010 results. According to Ernst & Young, there is
uncertainty that Horizon Lines, Inc., will remain in compliance
with certain debt covenants throughout 2011 and will be able to
cure the acceleration clause contained in the convertible notes.
* * *
As reported in the Troubled Company Reporter on March 8, 2011,
Moody's Investors Service said Horizon Lines, Inc.'s plea
agreement regarding antitrust matters in the Puerto Rico trade
lane is credit negative but does not at this time affect its
'Caa1' Corporate Family or its other debt ratings of Horizon.
The last rating action on Horizon was on May 18, 2010 when Moody's
lowered its ratings, including the corporate family rating to
'Caa1' and maintained the negative outlook.
INTERNATIONAL ENERGY: Wants Until Aug. 28 to File Ch. 11 Plan
-------------------------------------------------------------
International Energy Holdings Corp., asks the U.S. Bankruptcy
Court for the Northern District of Iowa to extend its exclusive
periods to file and solicit acceptances for the proposed plan of
reorganization until Aug. 28, 2011, and Sept. 24, respectively.
The Debtor requests for the extension due to unforeseen
circumstances and delays related to a change in venue.
The Debtor relates that the Court may rule on the motion without
hearing. If objection is filed, the matter will come before the
Court by telephonic hearing on July 26, at 1:30 p.m.
About International Energy
Tampa, Florida-based International Energy Holdings Corp. -- fka
International CRO Holdings Corp.; The Cornerstone Brad, LLC; and
Bison Renewable Energy, LLC -- filed for Chapter 11 bankruptcy
protection on March 28, 2011 (Bankr. M.D. Fla. Case No. 11-05547).
Richard J. McIntyre, Esq., at McIntyre, Panzarella, Thanasides &
Eleff, serves as the Debtor's bankruptcy counsel. The Debtor
disclosed $13,154,805 in assets and $15,862,937 in liabilities as
of the Chapter 11 filing.
The U.S. Bankruptcy Court for the Middle District of Florida
authorized the transfer of venue of the case to a bankruptcy court
in the Northern District of Iowa.
Donald F. Walton, U.S. Trustee for Region 21, appointed three
members to the Official Committee of Unsecured Creditors in the
Debtor's case.
INTERNATIONAL ENERGY: Creditors Meeting Rescheduled Until Sept. 1
-----------------------------------------------------------------
The U.S. Trustee for Region 21 has rescheduled the meeting of
creditors in the Chapter 11 case of International Energy Holdings
Corp.'s on Aug. 16, 2011, at 10:00 a.m. The meeting will be held
at Sioux City Convention Center, Main Floor, Room 3, 801 Fourth
Street, Sioux City, Iowa.
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.
Tampa, Florida-based International Energy Holdings Corp. -- fka
International CRO Holdings Corp.; The Cornerstone Brad, LLC; and
Bison Renewable Energy, LLC -- filed for Chapter 11 bankruptcy
protection (Bankr. M.D. Fla. Case No. 11-05547) on March 28, 2011.
Richard J. McIntyre, Esq., at McIntyre, Panzarella, Thanasides &
Eleff, serves as the Debtor's bankruptcy counsel. According to
its schedules, the Debtor disclosed $13,212,668 in total assets
and $14,331,482 in total debts as of the Petition Date.
LA PALOMA: S&P Assigns Prelim. 'B' Rating on Term Loan Facility
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary 'B'
rating to La Paloma Generating Co.'s $299.2 million secured first-
lien term loan facility due 2017. The facility includes a $30
million cash-collateralized letter of credit. "In addition, we
assigned a preliminary '1' recovery rating to the facility,
indicating a high expectation of recovery (90% to 100%) if a
default occurs. The outlook is stable," S&P said.
La Paloma is also issuing a $65 million first-lien working capital
facility due 2016 ($15 million revolver and a $50 million
participating letter of credit that La Paloma will exclusively use
to support its commodity hedging program) and $130 million secured
second-lien term facility due 2018 ($110 million term loan and $20
million participating letter of credit for the commodity hedging
program), both of which Standard & Poor's does not rate.
The secured first-lien term loan has a preliminary '1' recovery
rating, indicating a high expectation of recovery (90% to 100%) if
a default occurs. "In our simulated default scenario, La Paloma is
unable to refinance its outstanding debt at maturity in 2017 on
reasonable terms," S&P said.
All ratings are preliminary, subject to review of final
documentation and conditional on the proposed financing being
completed and execution of hedge agreements to mitigate market
price volatility and carbon costs.
When La Paloma successfully completes the transaction, S&P would
withdraw the preliminary rating and assign final issue and
recovery ratings.
La Paloma will use proceeds from the term loan facilities to repay
the existing $265 million ($236 million outstanding as of June 30,
2011) secured first-lien term loan B (CCC+/Positive) due 2012 and
La Paloma's second-lien $155 million ($155 million outstanding)
term loan C (CC/Positive) due 2013, as well as to prefund the debt
service reserve, a $30.2 million synthetic letter of credit, and
the $20 million major maintenance account for 2011-2013.
"La Paloma's preliminary ratings reflect the adverse impacts on
its near-term financial performance of depressed natural gas
prices and the inability, under existing tolling agreements, to
recover carbon costs that it will incur under requirements of
California's cap and trade law in 2013," said Standard &
Poor's credit analyst Marc Sonnenblick.
The outlook on the new debt is stable. "We expect La Paloma's
hedging program to provide some stability to the cash flow needed
to meet its debt service obligations, and the cash sweep should
help pay down debt by more than one-half at maturity under our
base case assumptions, improving the long-term financial profile.
Over the near term, La Paloma will be adversely affected by the
currently low gas prices and the inability, under the existing MS
toll, to recover carbon costs that the project will incur under
requirements of California carbon compliance in 2013. We could
lower the ratings in the unexpected event California implements
carbon compliance in 2012 and La Paloma has heat rate degradation,
decreased availability, or an increase in O&M above expectations.
We could also downgrade if the hedge program fails to stabilize
cash flow to the extent projected. An upgrade is unlikely over the
next one to two years," S&P related.
LAKE PLEASANT: All Creditors to Be Paid in Full Under Plan
----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Arizona has
scheduled a hearing for Sept. 14, 2011, at 10:00 a.m. to consider
the adequacy of the disclosure statement describing the joint plan
of reorganization of Lake Pleasant Group, LLP, and and DLGC II,
LLC, dated July 12, 2011.
The Debtors' schedules list Johnson Bank as a creditor with a
total claim in the approximate amount of $19,363,940 secured by a
first position lien on the Properties. Lake Pleasant's schedules
list unsecured creditors in the amount of $151,000, and DLGC's
schedules list unsecured creditors in the amount of $189,947.
The Debtors are currently in the process of seeking a rezoning of
the Properties to Mixed Used-Recreational Vehicle Resort and
Commercial to allow a luxury oriented recreational-vehicle resort
with approximately 1,512 spaces to exist on the Properties. The
DLGC Property will also include a 22-acre commercial site which
will allow the opportunity for supporting retail and two R.V.
storage parcels, as ancillary uses to help support the RV resort
and the surrounding areas.
The Debtors and Pensus Cholla Hills RV Resort LLC have entered
into the Sales Agreement which provides for the sale of the
Properties to Pensus, for not less than $23,000,000. The Sale of
the Properties will be conditioned upon the Properties being
rezoned as set forth above. The Sale will result in all creditors
being paid in full on their Allowed Claims.
The Plan designates four (4) Classes of Claims and Interests.
Class 1 Priority Claims will be paid in full, in Cash, on or
before the Effective Date.
Johnson Bank's Class 2-A Secured Claim will be paid the full
amount of its Allowed Secured Claim on the Effective Date from the
Net Proceeds generated by the Sale.
Class 3 Allowed Unsecured Claims will also be paid in full from
the Net Proceeds derived from the Sale.
Class 4 Interests in the Debtors will retain their Interests in
the Reorganized Debtors.
A copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/lakepleasant.DS.pdf
About Lake Pleasant
Phoenix, Arizona-based Lake Pleasant Group, LLP, was formed for
the purpose of purchasing and developing 244 acres of real
property located near State Route 74 and Old Lake Pleasant Road in
Peoria, Arizona. The partnership filed for Chapter 11 bankruptcy
protection (Bankr. D. Ariz. Case No. 11-10170) on April 13, 2011.
In its schedules, Lake Pleasant Group disclosed assets of
$15,780,263 and liabilities of $10,301,552 as of the Petition
Date.
Affiliate DLGC II, LLC, simultaneously filed for Chapter 11
protection (Bankr. D. Ariz. Case No. 11-10174). DLGC owns 210
acres of real property located near State Route 74 and Old Lake
Pleasant Road in Peoria, Arizona. DLGC also owns interests in
Lake Pleasant Water Company and Lake Pleasant Sewer Company. DLGC
has valued these interests at $1,313,511 in its schedules. Mark
W. Roth, Esq., and Wesley D. Ray, Esq., at Polsinelli Shughart PC,
in Phoenix, Ariz., represent the Debtors as counsel.
LANDMARK BANK: Closed; American Momentum Bank Assumes All Deposits
------------------------------------------------------------------
American Momentum Bank of Tampa, Fla., acquired the banking
operations, including all the deposits, of Southshore Community
Bank of Apollo Beach, Fla., and LandMark Bank of Florida of
Sarasota, Fla. The two banks were closed on Friday, July 22,
2011, by the Florida Office of Financial Regulation, which
appointed the Federal Deposit Insurance Corporation as receiver.
To protect the depositors, the FDIC entered into a purchase and
assumption agreement with American Momentum Bank.
Southshore Community Bank had two branches, and LandMark Bank of
Florida had six branches. All eight branches of the two closed
banks will reopen during normal business hours as branches of
American Momentum Bank. Depositors of the two failed banks will
automatically become depositors of American Momentum Bank.
Deposits will continue to be insured by the FDIC, so there is no
need for customers to change their banking relationship in order
to retain their deposit insurance coverage up to applicable
limits. Customers of the two failed banks should continue to use
their existing branches until they receive notice from American
Momentum Bank that it has completed systems changes to allow other
branches of American Momentum Bank to process their accounts as
well.
As of March 31, 2011, Southshore Community Bank had around $46.3
million in total assets and $45.3 million in total deposits; and
LandMark Bank of Florida had total assets of $275.0 million and
total deposits of $246.7 million. In addition to assuming all of
the deposits of the two Florida banks, American Momentum Bank
agreed to purchase essentially all of their assets.
Customers with questions about the transaction should call the
FDIC toll-free: for Southshore Community Bank customers, 1-800-
894-2013, and for LandMark Bank of Florida customers, 1-800-889-
4976. Interested parties also can visit the FDIC's Web sites: for
Southshore Community Bank,
http://www.fdic.gov/bank/individual/failed/southshore.html
and for LandMark Bank of Florida,
http://www.fdic.gov/bank/individual/failed/LandMark.html
The FDIC estimates that the cost to the Deposit Insurance Fund for
Southshore Community Bank will be $8.3 million and for LandMark
Bank of Florida, $34.4 million. Compared to other alternatives,
American Momentum Bank's acquisition of the two institutions was
the least costly resolution for the FDIC's DIF.
The closings are the 56th and 57th FDIC-insured institutions to
fail in the nation so far this year and the eighth and ninth in
Florida. The last FDIC-insured institution closed in the state
was First Peoples Bank, Port Saint Lucie, on July 15, 2011.
LINDEN PONDS: Receives Approval to Tap $6 Million DIP Loan
----------------------------------------------------------
American Bankruptcy Institute reports that Linden Ponds Inc. and
its affiliate Hingham Campus LLC can use a $6 million debtor-in-
possession loan on a final basis.
The Debtors have reached an agreement where holders of 40% of the
bonds have pledged to support and vote in favor of a Joint Plan of
Reorganization of the Debtors. The Debtors add that the three
impaired classes under the Plan have indicated that they will
accept the Plan. Redwood Capital Investors LLC, will retain its
ownership interest of the Debtors through the Plan.
The Debtors are asking the bankruptcy court to hold a joint
hearing on Sept. 15 and Sept. 16 for approval of the disclosure
statement and confirmation of the reorganization plan.
Redwood is providing $6 million in a postpetition revolving credit
facility for Hingham Campus' Chapter 11 case. The DIP financing
will mature on Nov. 8, 2011. The DIP financing requires a joint
hearing on the Disclosure Statement and the Plan within 120 days
of the Petition Date.
About Linden Ponds
Linden Ponds Inc. operates a 108-acre continuing care retirement
community located at 300 Linden Ponds Way in Hingham,
Massachusetts. The facility has 988 independent living units
(with an occupancy rate of 87.9%) and 132 skilled nursing beds
(68% occupancy rate).
Linden Ponds leases the facility and the property upon which it is
built from Hingham Campus LLC. Hingham is the owner of the
facility and owns the fee simple interest in the property upon
which the facility is built. Senior Living Retirement
Communities, LLC, formerly known as Erickson Retirement
Communities, LLC, owns 100% of the membership interests in
Hingham.
Hingham Campus and Linden Ponds filed a pre-negotiated Chapter 11
petition (Bankr. N.D. Tex. Lead Case No. 11-33912) in Dallas on
June 15, 2011. Hingham Campus estimated assets and debts of $100
million to $500 million. Debt includes $156.4 million owing on
bonds issued by the Massachusetts Development Finance Agency, with
Wells Fargo Bank, National Association, as the bond trustee.
Erickson Retirement Communities sought bankruptcy protection
(Bankr. N.D. Tex. Case No. 09-37010) on Oct. 19, 2009. Erickson,
the owner of 20 senior living facilities, won approval of its
reorganization plan in April 2010. The Erickson plan provided for
a sale to Redwood Capital, the highest bidder at the auction in
December 2009. Redwood won the auction with an all-cash bid of
$365 million.
Attorneys at DLA Piper LLP (US) represent Hingham in the Chapter
11 case. Attorneys at McGuire, Craddock & Strother, P.C., and
Whiteford, Taylor And Preston, L.L.P., represent Linden Ponds.
LOS ANGELES DODGERS: Judge Ejects $150 Million DIP Financing Plan
-----------------------------------------------------------------
Eric Morath, writing for Dow Jones' Daily Bankruptcy Review,
reports that Judge Kevin Gross on Friday ruled that the Los
Angeles Dodgers could not use a $150 million loan from its
preferred lender, Highbridge Principal Strategies, because a
better loan was available -- specifically, the financing the Major
League Baseball offered.
The Dodgers "not only failed to attempt to obtain unsecured
financing, they refused to engage Baseball in negotiations," Judge
Gross wrote in his order, according to the report. "Baseball is
ready, anxious and able to provide unsecured financing and has
committed to do whatever it takes to do just that."
DBR relates Judge Gross directed the league and the Dodgers to
enter into meaningful negotiations about a credit agreement.
Judge Gross also said MLB's loan must be free of control
provisions and assured the Dodgers that he will offer protections
in "the hopefully unlikely event that baseball strays from its
obligations to act in good faith."
MLB has already offered a loan that comes on an unsecured basis,
at a reduced interest rate and without nearly $10 million in fees
the team committed to pay Highbridge, a hedge-fund manager owned
by J.P. Morgan Chase & Co.
According to DBR, Dodgers attorney Bruce Bennett, Esq., at Dewey &
LeBoeuf LLP, said Friday the team will pursue financing from MLB.
The Dodgers need the loan to pay current players at the end of the
month. However, Mr. Bennett said the Dodgers intend to push
forward with plans to auction off future broadcast rights as a
means to stabilize the team's finances. MLB is likely to fight
that move as well.
DBR relates MLB spokesman Mike Teevan would only say that the
league is "pleased that the court has agreed with our position"
with respect to the loan.
DBR also reports that News Corp.'s Fox Sports, the Dodgers'
current broadcaster, will likely protest the auction plan. Under
the media company's existing contract the Dodgers are barred from
soliciting bids from competitors.
About the Los Angeles Dodgers
Los Angeles Dodgers LLC operates the Los Angeles Dodgers, a
professional Major League Baseball club in the Los Angeles
metropolitan area. Frank McCourt, a Boston real-estate developer
who unsuccessfully bid for the Boston Red Sox, bought the Dodgers
from Rupert Murdoch's Fox Entertainment Group, Inc. in 2004 for
$330 million. Mr. McCourt also bought the Dodgers Stadium from
Fox for $100 million.
Los Angeles Dodgers LLC filed for bankruptcy protection (Bankr. D.
Del. Lead Case No. 11-12010) on June 27, 2011, after MLB
Commissioner Bud Selig rejected a television deal with News
Corp.'s Fox Sports, leaving Mr. McCourt unable to make payroll for
June 30 and July 1. Fox Sports has exclusive cable television
rights for Dodgers games until the end of 2013 baseball season.
Chapter 11 filings were also made for LA Real Estate LLC, an
affiliated entity which owns Dodger Stadium, and three other
related holding companies.
The petition estimates assets of up to $500 million and debts of
up to $1 billion. According to Forbes, the team is worth about
$800 million, making it the third most valuable baseball team
after the New York Yankees and the Boston Red Sox.
Judge Kevin Gross presides over the case. Lawyers at Young,
Conaway, Stargatt & Taylor and Dewey & LeBoeuf LLP serve as the
Debtors' bankruptcy counsel. Epiq Bankruptcy Solutions LLC is the
claims and notice agent. Thomas Lauria, Esq., at White & Case,
represents MLB.
The LA Dodgers is the 12th sports team in North America to have
sought bankruptcy protection, according to The Wall Street
Journal.
MALIBU ASSOCIATES: Can Use Bank's Cash Collateral Until Sept. 30
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California
has approved the Fourth Stipulation between Malibu Associates,
LLC, and the U.S. Bank National Association, permitting use of
cash collateral from July 1, 2011, through Sept. 30, 2011,
pursuant to a budget.
As reported in the TCR on Feb. 25, 2011, the Court entered its
order approving the Third Stipulation between the Debtor and the
Bank permitting use of cash collateral through June 30, 2011.
Pursuant to the Fourth Stipulation, the Debtor is authorized to
use cash collateral provided that: (i) the aggregate expenditures
for all categories set forth in the budget, other than the $10,000
per month management fee, do not exceed the budgeted aggregate
expenses by more that 15%; and (ii) the expenditures with respect
to any particular category of expenses, other than $10,000 per
month management fee, do not exceed by more than 20%; and provided
further, that the Debtor will provide or obtain any notice or
order of the Court before any expense is paid that requires prior
notice or order of the Court, including payments regarding insider
compensation.
As adequate protection for the Debtor's cash collateral use, the
bank will have a replacement lien on all postpetition property of
the same type and character as the property to the bank's
prepetition lien extended, to secure the prepetition claim of the
Bank against the Debtor.
As additional adequate protection, the Debtor will provide the
Bank with reports and information related to the Debtor's use of
the cash collateral as the Bank may reasonably request.
About Malibu Associates, LLC
Malibu, California-based Malibu Associates, LLC, dba Malibu
Country Club and Malibu Country Club filed for Chapter 11
bankruptcy (Bankr. C.D. Calif. Case No. No. 09-24625) on Nov. 3,
2009. Ashleigh A. Danker, Esq., and Marc S. Cohen, Esq., at Kaye
Scholer LLP, in Los Angeles, represent the Debtor in its
restructuring effort. The Company disclosed assets of
$42,853,592, and debts of $35,758,538 as of the Petition Date.
The Court extended the Debtor's exclusive periods to file and
solicit acceptances for the proposed chapter 11 plan until Feb. 4,
2011, and April 4. To date, the Debtor hasn't filed a motion for
an extension of its exclusivity periods.
MAQ MANAGEMENT: Wants Order Dismissing Chapter 11 Cases Vacated
---------------------------------------------------------------
MAQ Management, Inc., et al., ask the U.S. Bankruptcy Court for
the Southern District of Florida to vacate the orders dismissing
their Chapter 11 cases.
The Debtors relate that the deadline to file schedules and
statements of financial affairs was originally set for June 29,
they filed an ex-parte motion to extend the time to file their
schedules and SOFAs for a period of 10 days. The Court entered
the order which inadvertently referenced Saturday, July 9, (as
opposed to Monday July 11) as the deadline.
The Debtors note that according to Rule 9006 (Federal Rules
adopted in Bankruptcy proceedings):
Rule 6. Computing and Extending Time; (a) Computing Time. The
following rules apply in computing any time period specified in
these rules, in any local rule or court order, or in any
statute that does not specify a method of computing time. (1)
Period Stated in Days or a Longer Unit. When the period is
stated in days or a longer unit of time: (A) exclude the day of
the event that triggers the period; (B) count every day,
including intermediate Saturdays, Sundays, and legal holidays;
and (C) include the last day of the period, but if the last day
is a Saturday, Sunday, or legal holiday, the period continues
to run until the end of the next day that is not a Saturday,
Sunday, or legal holiday.
As a result of the operation of Rule 9006, the deadline was
midnight July 11, for the filing of the schedules and SOFAs in
these chapter 11 cases.
The Debtors assert that the orders dismissing improperly listed
the deadlines for the filing of schedules and SOFAs as "6/29/2011"
which was incorrect.
The Debtors had filed their schedule and SOFAS on July 11.
The Debtors also request that the Section 341 meeting date of
Aug. 1, 2011, be maintained.
About MAQ Management
Based in Boca Raton, Florida, MAQ Management, Inc., and three
other affiliates serve as commercial landlords to convenience
stores and gas stations in primarily in South Florida. They filed
for Chapter 11 bankruptcy (Bankr. S.D. Fla. Cases No. 11-26571 to
11-26574) on June 15, 2011. Affiliates that sought Chapter 11
protection are Super Stop Petroleum, Inc., Super Stop Petroleum I,
Inc., and Super Stop Petroleum IV, Inc. Judge Erik P. Kimball
presides over the case. Lawyers at Talarchyk Merrill, LLC, serve
as the Debtors' counsel. MAQ Management estimated assets and
debts of $1 million to $10 million. Super Stop estimated assets
and debts of $10 million to $50 million. The petitions were
signed by Mahammad A. Qureshi, CEO.
No trustee, examiner, or statutory committee has been appointed in
these Chapter 11 cases.
MAQ MANAGEMENT: BB&T and 1st Nat'l. Objects to Cash Collateral Use
------------------------------------------------------------------
Branch Banking & Trust Company objects to the motion of MAQ
Management, Inc., for authority to use cash collateral for these
reasons:
1) the proposed budget does not separately identify BB&T's
collateral or provide a separate budget of expenses and
income for BB&T's collateral;
2) the Budget includes certain inappropriate amounts as
income and expenses; and
3) the Motion does not identify sufficient adequate
protection for the use of BB&T's cash collateral.
In the event that the Court is inclined to grant the use of
BB&T's Cash collateral, BB&T requests that the Court require the
Debtors to:
1) make adequate protection payments to BB&T;
2) grant BB&T a perfected post-petition replacement lien;
3) maintain insurance coverage for all property upon which
BB&T has a lien and name BB&T as the loss payee and
additional insured;
4) comply with all provisions of the Loan Document with BB&T
other than those that require payments to BB&T;
5) provide to BB&T copies of all current written agreements
and any amendment thereto between any of the Debtors and
any third party affecting any of BB&T's collateral;
6) provide BB&T with reports showing accounts receivables,
a reasonably detailed cash flow statement, copies of the
Debtors' general ledgers, copies of the Debtor's check
registers and bank statements, copies of documents
evidencing any deposits into bank accounts, and the
reports the Debtors are required to file with the U.S.
Trustees Office; and
7) allow BB&T to visit, inspect, and have reasonable access
to the Debtors' collateral.
BB&T also requests that the Court condition the use of BB&T's cash
collateral upon the granting of a super-priority administrative
expense claim for any diminution in cash collateral resulting from
the Debtors' use and requests that any such order be without
prejudice to BB&T's rights or remedies, including motions to
terminate automatic stay, to dismiss, for the appointment of a
trustee or to seek dismissal or conversion of these cases.
BB&T is represented by:
Kevin A. Reck
FOLEY & LARDNER LLP
111 N. Orange Ave., Suite 1800
Orlando, FL 32802-2193
Phone: (407)423-7656
Fax: (407) 648-1743
E-mail: Kreck@foley.com
1st National Bank of South Florida, a secured creditor of MAQ
Management Inc., also filed an objection to the continued use of
cash collateral. 1st National asks the Court to prohibit the
Debtor from the use of cash collateral, require the Debtor to
segregate all cash collateral, and require the Debtor to provide
1st National with an accounting of all post-petition receipts and
disbursements of Cash Collateral.
The Debtor has neither requested 1st National's consent to use its
cash collateral, moved this Court for authorization nor offered to
provide 1st National with adequate protection. Furthermore, the
Debtor is believed to be commingling the cash collateral of
multiple secured creditors who hold liens on different properties.
Not only has the Debtor failed to segregate the cash collateral,
it has failed to provide any accounting to 1st National as to the
cash collateral currently being held.
1st National Bank of South Florida is represented by:
Brian P. Yates
SAPURSTEIN & BLOCH, P.A.
9700 South Dixie Highway, Suite 1000
Miami, Florida 33156
Phone: (305) 670-9500
Fax: (305) 670-6900
E-mail: byates@sblawfirmfl.com
About MAQ Management
Based in Boca Raton, Florida, MAQ Management, Inc., and three
other affiliates serve as commercial landlords to convenience
stores and gas stations in primarily in South Florida. They filed
for Chapter 11 bankruptcy (Bankr. S.D. Fla. Cases No. 11-26571 to
11-26574) on June 15, 2011. Affiliates that sought Chapter 11
protection are Super Stop Petroleum, Inc., Super Stop Petroleum I,
Inc., and Super Stop Petroleum IV, Inc. Judge Erik P. Kimball
presides over the case. Lawyers at Talarchyk Merrill, LLC, serve
as the Debtors' counsel. MAQ Management estimated assets and
debts of $1 million to $10 million. Super Stop estimated assets
and debts of $10 million to $50 million. The petitions were
signed by Mahammad A. Qureshi, CEO.
MAQ MANAGEMENT: Files Schedules of Assets and Liabilities
---------------------------------------------------------
MAQ Management, Inc., filed with the U.S. Bankruptcy Court for the
Southern District of Florida, its schedules of assets and
liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ------- -----------
A. Real Property $1,100,000
B. Personal Property $23,169,834
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $3,126,390
E. Creditors Holding
Unsecured Priority
Claims $40,861
F. Creditors Holding
Unsecured Non-priority
Claims $2,305,678
----------- --------------
TOTAL $24,269,560 $5,472,923
About MAQ Management
Based in Boca Raton, Florida, MAQ Management, Inc., and three
other affiliates serve as commercial landlords to convenience
stores and gas stations in primarily in South Florida. They filed
for Chapter 11 bankruptcy (Bankr. S.D. Fla. Cases No. 11-26571 to
11-26574) on June 15, 2011. Affiliates that sought Chapter 11
protection are Super Stop Petroleum, Inc., Super Stop Petroleum I,
Inc., and Super Stop Petroleum IV, Inc. Judge Erik P. Kimball
presides over the case. Lawyers at Talarchyk Merrill, LLC, serve
as the Debtors' counsel. MAQ Management estimated assets and
debts of $1 million to $10 million. Super Stop estimated assets
and debts of $10 million to $50 million. The petitions were
signed by Mahammad A. Qureshi, CEO.
MARONDA HOMES: Can Use Cash Collateral Until Aug. 31
----------------------------------------------------
Judge Judith K. Fitzgerald of the U.S. Bankruptcy Court for the
Western District of Pennsylvania further extended the time by
which Maronda Homes, Inc., and its debtor affiliates may use cash
collateral until Aug. 31, 2011.
If, as of August 31, the amount of cash collateral collected from
closings that occur between April 18 and August 31, exceeds the
actual or accrued expenditures of the Debtors as authorized by the
Court, the amount of that excess may be applied by the lenders to
the principal loan balance then outstanding under the Debtors'
credit agreement.
The Lenders are: Bank of America, N.A., Wells Fargo Bank, N.A.,
Wachovia Bank, National Association, PNC Bank, National
Association, KeyBank National Association, Huntington National
Bank, Fifth Third Bank, Regions Bank, BMO Capital Markets
Financing, Inc., SunTrust Bank, N.A., Compass Bank (as successor
to Guaranty Bank), Compass Bank, Comerica Bank, and U.S. Bank
National Association.
A full-text copy of the Interim Cash Collateral Order with the
budget from April 18 to August 31 is available for free at:
http://ResearchArchives.com/t/s?7626
A final hearing on the Cash Collateral Motion will be held on
Aug. 26, 2011, at 11:00 a.m. Objections must be served by
August 23.
About Maronda Homes
Maronda Homes, Inc., based in Clinton, Pennsylvania, near
Pittsburgh, builds homes in Florida, Pennsylvania, Georgia and
Kentucky. It filed for Chapter 11 bankruptcy protection (Bankr.
W.D. Pa. Case No. 11-22418) on April 18, 2011. Joseph F.
McDonough, Esq., at Manion Mcdonough & Lucas, serves as the
Debtor's bankruptcy counsel. The Debtor estimated its assets
at $100 million to $500 million and debts at $50 million to
$100 million.
Affiliates Maronda Homes, Inc. of Ohio (Bankr. W.D. Pa. Case No.
11-22422) and Maronda Homes of Cincinnati, LLC (Bankr. W.D. Pa.
Case No. 11-22424) simultaneously filed separate Chapter 11
petitions on April 18, 2011.
MARONDA HOMES: Has Final Authority to Pay Critical Vendor Claims
----------------------------------------------------------------
Judge Judith K. Fitzgerald of the U.S. Bankruptcy Court for the
Western District of Pennsylvania gave final authority for Maronda
Homes, Inc., and its debtor affiliates to pay prepetition claims
of critical vendors provided the aggregate payment does not exceed
$4 million.
About Maronda Homes
Maronda Homes, Inc., based in Clinton, Pennsylvania, near
Pittsburgh, builds homes in Florida, Pennsylvania, Georgia and
Kentucky. It filed for Chapter 11 bankruptcy protection (Bankr.
W.D. Pa. Case No. 11-22418) on April 18, 2011. Joseph F.
McDonough, Esq., at Manion Mcdonough & Lucas, serves as the
Debtor's bankruptcy counsel. The Debtor estimated its assets
at $100 million to $500 million and debts at $50 million to
$100 million.
Affiliates Maronda Homes, Inc. of Ohio (Bankr. W.D. Pa. Case No.
11-22422) and Maronda Homes of Cincinnati, LLC (Bankr. W.D. Pa.
Case No. 11-22424) simultaneously filed separate Chapter 11
petitions on April 18, 2011.
MEDICURE INC: Eric Johnstone Resigns as Chief Financial Officer
---------------------------------------------------------------
Medicure Inc. announced that effective July 15, 2011, Mr. Eric
Johnstone has resigned from his position as Chief Financial
Officer of the Company to take on another position. The Company
wishes to thank Mr. Johnstone for his contributions, which were
provided to Medicure under the Company's service contract with
Genesys Venture Inc.
The Company has established a transition plan, appointing Dawson
Reimer, vice president, Operations of Medicure, as interim CFO.
The Company will also employ the services of other professionals
within GVI's accounting group during the transition period.
About Medicure Inc.
Based in Winnipeg, Manitoba, Canada, Medicure Inc. (TSX/NEX:
MPH.H) -- http://www.medicure.com/-- is a biopharmaceutical
company engaged in the research, development and commercialization
of human therapeutics. The Company has rights to the commercial
product, AGGRASTAT(R) Injection (tirofiban hydrochloride) in the
United States and its territories (Puerto Rico, U.S. Virgin
Islands, and Guam). AGGRASTAT(R), a glycoprotein GP IIb/IIIa
receptor antagonist, is used for the treatment of acute coronary
syndrome (ACS) including unstable angina, which is characterized
by chest pain when one is at rest, and non-Q-wave myocardial
infarction.
At Feb. 28, 2011, the Company's consolidated balance sheets
showed C$5.7 million in total assets, C$30.7 million in total
liabilities, all current, and a shareholders' deficit of
$25.0 million.
As reported in the Troubled Company Reporter on Oct. 4, 2010,
KPMG LLP, in Winnipeg, Canada, expressed substantial doubt about
Medicure's ability to continue as a going concern, following its
results for the fiscal year ended May 31, 2010. The independent
auditors noted that the Company has experienced operating losses
and cash flows from operations since incorporation and has
significant debt servicing obligations that it does not have the
ability to repay.
MEDICURE INC: Settles $32.8 Million Birmingham Debt
---------------------------------------------------
Medicure Inc. announced that, following a comprehensive strategic
review and formal process, the Company has completed these
transactions:
* settled the debt of US$32,839,659 owing to Birmingham
Associates Ltd. in exchange for the following consideration:
(i) approximately C$5 million in cash (less certain costs
not to exceed $250,000); (ii) 32,640,043 common shares of the
Company; and (iii) the granting of a royalty in AGGRASTAT(R)
sales;
* borrowed C$5 million pursuant to a loan from Manitoba
Development Corporation, to assist the current and future
activities of the Company including the Birmingham Debt
Settlement and certain professional costs relating thereto,
secured by the Company's assets, and guaranteed by Dr. Albert
Friesen, President, CEO, and Chair, and entities controlled
by Dr. Friesen; and
* issued an aggregate of 20,000,000 common shares of the
Company to Dr. Friesen and ADF Family Holding Corp. in
consideration for providing the guarantee of the MIOP Loan
and entered into a guarantee indemnity agreement with Dr.
Friesen.
Prior to the Birmingham Debt Settlement, Birmingham held warrants
to purchase, on or before Dec. 31, 2016, 1,000,000 common shares
of the Company at an exercise price of US$1.26 per share,
representing 0.8% of the Company's issued and outstanding common
shares on a partially diluted basis. Pursuant to the Birmingham
Debt Settlement, an affiliate of Birmingham, Elliott International
L.P., has acquired 32,640,043 common shares of the Company. The
Acquirer now owns 32,640,043 common shares of the Company, and
Birmingham continues to hold warrants to purchase an additional
1,000,000 common shares of the Company, together representing
18.3% of the Company's issued and outstanding common shares on a
partially diluted basis.
A full-text copy of the press release is available for free at:
http://is.gd/HJLUFV
About Medicure Inc.
Based in Winnipeg, Manitoba, Canada, Medicure Inc. (TSX/NEX:
MPH.H) -- http://www.medicure.com/-- is a biopharmaceutical
company engaged in the research, development and commercialization
of human therapeutics. The Company has rights to the commercial
product, AGGRASTAT(R) Injection (tirofiban hydrochloride) in the
United States and its territories (Puerto Rico, U.S. Virgin
Islands, and Guam). AGGRASTAT(R), a glycoprotein GP IIb/IIIa
receptor antagonist, is used for the treatment of acute coronary
syndrome (ACS) including unstable angina, which is characterized
by chest pain when one is at rest, and non-Q-wave myocardial
infarction.
At Feb. 28, 2011, the Company's consolidated balance sheets
showed C$5.7 million in total assets, C$30.7 million in total
liabilities, all current, and a shareholders' deficit of
$25.0 million.
As reported in the Troubled Company Reporter on Oct. 4, 2010,
KPMG LLP, in Winnipeg, Canada, expressed substantial doubt about
Medicure's ability to continue as a going concern, following its
results for the fiscal year ended May 31, 2010. The independent
auditors noted that the Company has experienced operating losses
and cash flows from operations since incorporation and has
significant debt servicing obligations that it does not have the
ability to repay.
MEDICURE INC: Grants 12.5 Million Stock Options to CEO, et al.
--------------------------------------------------------------
Medicure Inc. announced that the Company has granted an aggregate
of 12,542,000 options to Dr. Albert Friesen, Dawson Reimer, and
employees and consultants of the Company pursuant to the Company's
Stock Option Plan. These options entitle the holders to acquire,
on or before the tenth anniversary of the date of grant, up to
12,542,000 common shares of the Company at an exercise price being
the greater of $0.10 per share and the closing price of the shares
on the first full trading day after closing of the Birmingham debt
settlement transactions. Of the Option Grants, 6,210,000 options
were granted to Dr. Friesen and 4,000,000 to Dawson Reimer.
Due to the interests of Dr. Friesen, a director of the Company,
and Dawson Reimer, a senior officer of the Company, the Insider
Option Grants constitute "related party transactions" for the
Company pursuant to Multilateral Instrument 61-101 Protection of
Minority Security Holders in Special Transactions.
About Medicure Inc.
Based in Winnipeg, Manitoba, Canada, Medicure Inc. (TSX/NEX:
MPH.H) -- http://www.medicure.com/-- is a biopharmaceutical
company engaged in the research, development and commercialization
of human therapeutics. The Company has rights to the commercial
product, AGGRASTAT(R) Injection (tirofiban hydrochloride) in the
United States and its territories (Puerto Rico, U.S. Virgin
Islands, and Guam). AGGRASTAT(R), a glycoprotein GP IIb/IIIa
receptor antagonist, is used for the treatment of acute coronary
syndrome (ACS) including unstable angina, which is characterized
by chest pain when one is at rest, and non-Q-wave myocardial
infarction.
At Feb. 28, 2011, the Company's consolidated balance sheets
showed C$5.7 million in total assets, C$30.7 million in total
liabilities, all current, and a shareholders' deficit of
$25.0 million.
As reported in the Troubled Company Reporter on Oct. 4, 2010,
KPMG LLP, in Winnipeg, Canada, expressed substantial doubt about
Medicure's ability to continue as a going concern, following its
results for the fiscal year ended May 31, 2010. The independent
auditors noted that the Company has experienced operating losses
and cash flows from operations since incorporation and has
significant debt servicing obligations that it does not have the
ability to repay.
MERIT GROUP: Files Chapter 11 Plan of Liquidation
-------------------------------------------------
The Merit Group, Inc., and its debtor affiliates filed with the
U.S. Bankruptcy Court for the District of South Carolina a Chapter
11 plan of liquidation and accompanying disclosure statement on
July 16, 2011.
Through the Plan, the Debtors seek to liquidate their remaining
assets and complete the wind-up of their business. The Plan
provides for the appointment of a liquidating supervisor, who will
manage the liquidation of the Debtors' assets and wind-up of the
business.
The Debtors believe that confirmation of the Plan and liquidation
of the remaining assets under the Plan will be more economical and
efficient than effecting a liquidation under Chapter 7 of the
Bankruptcy Code, including because the Liquidating Supervisor is
knowledgeable about the Debtors' assets and liabilities and
focused solely on the Chapter 11 Case and maximizing the Assets
for the benefit of the Estates, and no Chapter 7 trustee
commission or other Chapter 7 costs will be paid under the Plan.
The Plan provides payment in full in cash for administrative
claims. Priority tax claims will be paid in full in cash without
the postpetition interest.
The Plan also provides for this treatment and classification of
other claims:
Class Description Treatment
----- ----------- ---------
1 Secured Claims of Unimpaired. Will not receive
Regions Bank any distribution under the
Plan. Regions Bank will retain
its lien on the net proceeds of
the Sale to the extent and
priority of the original liens
on the Property sold, except
for any agreed carve-out, until
its Allowed Secured Claim is
paid in full.
2 Secured Claims of Unimpaired. Stonehenge will
Stonehenge not be entitled to receive any
distribution under the Plan.
Stonehenge will retain its lien
on the net proceeds of the
Sale, to the extent and
priority of the original liens
on the Property sold, remaining
after payment of the Class 1
Claim until its Allowed Secured
Claim is paid in full.
3 Secured Claims for Real Unimpaired. Liens of holders
and Personal Ad Valorem of Allowed Class 3 Claims will
Taxes payable to attach to the net proceeds of
Governmental Units the Sale to the extent and
priority of the original liens
on the Property sold. On
account of its Allowed Secured
Claim, each holder of each
resulting lien on proceeds in
Class 3 will be paid the amount
equal to each resulting lien in
Cash, together with
Post-Confirmation Interest from
the Effective Date to the date
of payment, with the payment to
be made on or before 30 days
after the date the Class 3
Claim becomes an Allowed
Secured Claim.
4 Claims of any other Unimpaired. The liens of
Secured Creditors holders of Allowed Class 4
Claims will attach to the net
proceeds of the Sale to the
extent and priority of the
original liens on the Property
sold. On account of its
Allowed Secured Claim, the
holder of each resulting lien
on proceeds in Class 4 will be
paid the amount equal to its
resulting lien in Cash with the
payment to be made on or before
30 days after the date each
Class 4 claim becomes an
Allowed Secured Claim.
5 Non-Tax Priority Claims Unimpaired. Paid in full, in
cash.
6 Convenience Class Claims Unimpaired. Each holder of an
Allowed Convenience Class Claim
will be paid the amount of its
Allowed Claim, but not to
exceed $300.
7 Unsecured Claims Impaired. Each holder of an
Allowed Unsecured Claim will
receive its pro rata
distribution of the net
distributable proceeds,
provided that the Liquidating
Supervisor will not make any
distribution of an Allowed
Class 7 Claim if the
distribution is less than $50.
8 Subordinated Claims Impaired. Distributions to
Allowed Subordinated Claims
will be made by the Liquidating
Supervisor on a Pro Rata basis
at a time as funds are deemed
available to pay Class 8
Allowed Subordinated Claims.
The Debtors currently
anticipate that no amount
amounts will be available to
pay any Claims determined to
constitute Allowed Subordinated
Claims. The Official Committee
of Unsecured Creditors may
contend that Stonehenge's Claim
should be a Class 8 Claim.
9 Interests Impaired. All Class 9
Interests will be deemed
canceled under the Plan as of
the Effective Date.
Full-text copies of the Plan and Disclosure Statement are
available for free at http://ResearchArchives.com/t/s?7685
About Merit Group
Based in Spartanburg, South Carolina, The Merit Group Inc.,
formerly Lancaster Distributing Company, serves as one of the
leading paint sundries distributors in the United States. Its
markets also include Mexico, the Caribbean Islands, Central
America and South America.
Merit Group filed for Chapter 11 bankruptcy protection (Bankr. D.
S.C. Lead Case No. 11-03216) on May 17, 2011. Judge Helen E.
Burris presides over the case. Michael M. Beal, Esq., McNair Law
Firm PA, represents the Debtors. The Debtors selected Kurtzman
Carson Consultants LLC as their claims agent; and Morgan Joseph
TriArtisan LLC, investment banker, and Alvarez & Marsal North
America, LLC, as financial advisors. Merit Group disclosed
7,004,048 in assets and $66,609,946 in liabilities as of the
Chapter 11 filing.
DIP Lender Regions Bank is represented by lawyers at Nexsen Pruet
Jacobs & Pollard and Parker, Hudson, Rainer & Dobbs, LLP.
The U.S. Trustee has named seven members to the Official Committee
of Unsecured Creditors. The Committee is represented by Cole,
Schotz, Meisel, Forman & Leonard, P.A. The Committee tapped
McCarthy Law Firm LLC as co-counsel, J.H. Cohn LLP as its
financial advisor.
METAL STORM: PricewaterhouseCoopers Raises Going Concern Doubt
--------------------------------------------------------------
Metal Storm Limited filed on July 20, 2011, its annual report on
Form 20-F for the fiscal year ended Dec. 31, 2010.
PricewaterhouseCoopers, in Brisbane, Australia, expressed
substantial doubt about Metal Storm's ability to continue as a
going concern. The independent auditors noted that the Company
has suffered recurring losses from operations and has a net
capital deficiency.
The Company reported a net loss of A$8.94 million on
A$3.35 million of revenue for 2010, compared with a net loss of
A$11.31 million on A$1.11 million of revenue for 2009.
The Company's balance sheet at Dec. 31, 2010, showed
A$2.15 million in total assets, A$20.64 million in total
liabilities, all current, and an equity deficit of
A$18.49 million.
A copy of the Form 20-F is available at http://is.gd/fMLpe7
Headquartered in Darra, Queensland, Australia, Metal Storm Limited
is a defense technology company with offices in Australia and the
United States. It specializes in the research, design,
development and integration of projectile launching systems
utilizing its "electronically initiated / stacked projectile"
technology for use in the defense, homeland security, law
enforcement and industrial markets.
MFJT LLC: Has Until Sept. 30 to Propose Reorganization Plan
-----------------------------------------------------------
The Hon. Eugene Wedoff of the U.S. Bankruptcy Court for the
Northern District of Illinois extended MFJT, LLC's exclusive
period to file and solicit acceptances for the proposed plan of
reorganization until Sept. 30, 2011, and Nov. 30, respectively.
Alsip, Illinois-based MFJT, LLC -- dba Somerset Park Apartments
and Somerset II -- filed for Chapter 11 bankruptcy protection
(Bankr. N.D. Ill. Case No. 11-11819) on March 22, 2011. David K.
Welch, Esq., at Crane Heyman Simon Welch & Clar, serves as the
Debtor's bankruptcy counsel. The Debtor proposes to employ
Tailwind Services, LLC as its financial advisor. The Debtor
disclosed $16,137,365 in assets and $17,952,853 in liabilities as
of the Chapter 11 filing.
MGM RESORTS: Amends to Borgata Settlement Agreement
---------------------------------------------------
MGM Resorts International entered into an amendment, subject to
approval by the New Jersey Casino Control Commission, with respect
to its settlement agreement with the New Jersey Division of Gaming
Enforcement under which it will sell its 50% ownership interest in
the Borgata Hotel Casino & Spa in Atlantic City.
The amendment provides that the mandated sale of the trust
property be increased by 18 months to 48 months. During the first
36 months (or until March 24, 2013), MGM Resorts has the right to
direct the trustee to sell the trust property. If a sale is not
concluded by that time, the trustee will be responsible for
selling MGM's interest in the Borgata during the following 12-
month period. All other material terms of the settlement
agreement remain unchanged.
The Casino Control Commission is expected to hold a hearing on the
amendment to the settlement on Aug. 8, 2011.
MGM remains the sole economic beneficiary of the trust. MGM
Resorts International owns its interest in the Borgata through a
50-50 joint venture with Boyd Gaming Corporation whose interest is
not affected by the settlement.
About MGM Resorts
MGM Resorts International (NYSE: MGM) --
http://www.mgmresorts.com/-- has significant holdings in gaming,
hospitality and entertainment, owns and operates 15 properties
located in Nevada, Mississippi and Michigan, and has 50%
investments in four other properties in Nevada, Illinois and
Macau.
The Company's balance sheet at March 31, 2011, showed
$18.76 billion in total assets, $15.84 billion in total
liabilities, and $2.92 billion in total stockholders' equity.
The Company reported a net loss of $1.44 billion on $6.01 billion
of revenue for the year ended Dec. 31, 2010, compared with a net
loss of $1.29 billion on $5.97 billion of revenue during the prior
year.
* * *
As reported by the Troubled Company Reporter on Oct. 18, 2010,
Standard & Poor's Ratings Services revised its rating outlook on
MGM Resorts to stable from developing. At the same time, S&P
affirmed all of its existing ratings on MGM, including the 'CCC+'
corporate credit rating.
The 'CCC+' corporate credit rating reflects MGM's significant debt
burden, S&P's expectation for meaningful declines in cash flow
generation in 2010, and the company's weak liquidity position.
While MGM maintains a leading presence on the Las Vegas Strip,
2010 will be another challenging year for the Strip, and prospects
for a meaningful rebound in 2011 are uncertain. The recent
pricing of the primary offering of common stock has bolstered
liquidity; however, the company's ability to weather the current
downturn and continue to service its debt obligations over the
longer term relies on continued progress toward addressing its
challenging debt maturity schedule, as well as a substantial
rebound in cash flow generation.
The TCR also reported that Fitch Ratings revised the Rating
Outlook for MGM Resorts to Positive following the company's equity
issuance. In addition, Fitch affirmed the Issuer
Default Rating at 'CCC'. MGM's 'CCC' IDR continues to reflect a
credit profile with substantial credit risk. MGM's probability of
default still displays a high sensitivity to an uninterrupted
recovery in the Las Vegas market, significant reliance on a
favorable refinancing and capital markets environment due to its
heavy debt maturity schedule, a highly leveraged balance sheet
despite potential debt reduction from the equity issuance, and a
weak near-term free cash profile. In addition, MGM's obligation
under the CityCenter completion guarantee continues to escalate,
and Fitch believes the company is currently under-investing in its
properties, which will likely impact asset quality.
As reported by the TCR on March 4, 2011, Moody's upgraded MGM
Resorts International's Corporate Family rating to B3 and its
Probability of Default rating to Caa1. The upgrade reflects signs
of modest improvement in demand trends in Las Vegas, debt
repayment during 2010 from the proceeds of equity issuances, and
completion of a new multi-year financing package for CityCenter
(MGM's 50% owned project on the Las Vegas Strip.)
NALCO CO: S&P Puts 'BB-' Corp. Credit Rating on Watch Positive
--------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on Ecolab
Inc., including its 'A' corporate credit rating, on CreditWatch
with negative implications, following the company's announcement
that it has entered into a definitive merger agreement to acquire
Nalco Holding Co., the parent company of Nalco Co., for
approximately $8.1 billion including assumed net debt.
The CreditWatch placement reflects the increased likelihood that
Standard & Poor's Ratings Services will lower its ratings on
Ecolab and its debt issues following its acquisition of Nalco
because of the resulting increase in debt leverage. "Based on
preliminary information, we expect that our corporate credit
rating on Ecolab will remain investment-grade but that we could
lower it by up to two notches," said Standard & Poor's credit
analyst Paul Kurias.
At the same time, Standard & Poor's placed its 'BB-' corporate
credit rating, and all issue-level ratings, on Nalco Co. on
CreditWatch with positive implications.
Ecolab announced that consideration to shareholders of Nalco
Holding Co. will be about $5.4 billion, consisting of
approximately 70% shares in Ecolab and 30% in cash. In addition,
Ecolab expects to assume approximately $2.7 billion in net debt at
Nalco. Standard & Poor's expects that Ecolab will raise permanent
financing for the acquisition prior to closing. Ecolab management
expects the transaction, which is subject to customary closing
conditions and regulatory approvals, to close by the end of 2011.
"We believe the acquisition of Nalco would improve and add
diversity to Ecolab's strong business risk profile while providing
management with a wider range of services to market to its
customers," Mr. Kurias said. The two companies serve some of the
same end markets and had combined annual sales of about $10
billion for 2010. The relative predictability and consistency of
operating results across both companies are key credit strengths,
according to Standard & Poor's.
St. Paul, Minn.-based Ecolab develops and markets cleaning,
sanitizing, food safety, and infection prevention products and
services for a broad range of customers. It had trailing-12-month
sales of about $6.2 billion as of March 31, 2011. Customers
include food services, food and beverage processors, health care
facilities, and hospitality markets.
Naperville, Ill.-based Nalco Co., a subsidiary of Nalco Holding
Co., had sales of about $4.3 billion for 2010.
The combined business would be a leading global provider of
cleaning, sanitizing, and water solutions in industries where
these services are important, including health care and food and
beverage. The combined operations should be positioned to
capitalize on attractive long-term trends including increased
emphasis on food safety and security, health and hygiene,
and sustainability.
NANA DEVELOPMENT: S&P Assigns Prelim. 'BB' Issue-Level Rating
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary 'BB'
issue-level rating (two notches higher than the company's
corporate credit rating) to Alaska-based NANA Development Corp.'s
(NANA) recently revised proposed new $175 million first-lien
senior secured term loan due 2016. "The preliminary recovery
rating is '1' indicating our expectation of very high recovery
(90%-100%) in the event of a default scenario. We are also
assigning a preliminary 'B+' issue-level rating to the company's
proposed $260 million second-lien senior secured term loan due
2017. The preliminary recovery rating is '4', indicating our
expectation of average recovery (30%-50%) in the event of a
default scenario. The company plans use the proceeds to refinance
its existing credit facility and to acquire Grand Isle Shipyard
Inc., an offshore oil and gas servicing maintenance provider," S&P
stated.
Based on the revised proposed capital structure, the preliminary
corporate credit rating on NANA remains 'B+' and reflects its
aggressive financial risk profile and its weak business risk
profile, marked by its reliance on government funding budgets,
integration risks with the proposed acquisition of Grand Isle
Shipyard Inc. (GIS), and the potential for declining zinc prices.
These factors are partially offset by some diversity of its
business lines, its well-established relationships with long-term
customers, and its committed royalty income from Red Dog Mine.
Currently, the operating margin (before depreciation and
amortization) in its services business is thin, at less than
10%. Pro forma for the revised capital structure, we expect the
company's financial leverage will be around 4.0x total adjusted
debt to EBITDA, and its funds from operations (FFO) to total
adjusted debt at roughly 15%. These measures would be in line with
S&P's expectations for the rating.
Ratings List
NANA Development Corp.
Corporate credit rating B+(prelim)/Stable/--
Ratings Assigned
NANA Development Corp.
Senior secured
$175 mil. first-lien term loan due 2016 BB(prelim)
Recovery rating 1(prelim)
$260 mil. second-lien term loan due 2017 B+(prelim)
Recovery rating 4(prelim)
NAVISTAR INT'L: Inks-1 Year Renewal Pact for $500-Mil. Facility
---------------------------------------------------------------
Navistar Financial Corporation has signed an agreement for a one-
year renewal of a $500 million dealer floor plan funding facility,
effective immediately. This facility is funded through two of
NFC's major relationship banks.
"This renewal, combined with additional funding sources, ensures
that we have appropriate liquidity to help International(R) and IC
BusTM dealers purchase their floor plan inventory," said David
Johanneson, president and chief executive officer of NFC.
"Throughout the difficult economic climate of the past few years,
the credit quality of our portfolio and the health of our dealer
network have remained strong, and we continue to have access to
funding to support the profitable growth of Navistar."
NFC continues to facilitate the majority of customer finance needs
in the United States through Navistar Capital, its retail program
formed last year in alliance with GE Capital.
This amendment serves to renew the Note Purchase Agreement through
July 18, 2012, removes Kitty Hawk Funding Corporation as a party
to the Agreement, and makes other administrative changes to the
Notes Purchase Agreement. A full-text copy of the Third Amendment
is available for free at http://is.gd/Suaq1Z
The Company also entered into the First Amendment, dated July 19,
2011, to the Indenture Supplement, dated April 16, 2010, among
Navistar Financial Dealer Note Master Owner Trust, as Issuer, and
The Bank of New York Mellon, as Indenture Trustee. This amendment
serves to make certain administrative changes to the Indenture
Supplement. A full-text copy of the First Amendment is available
for free at http://is.gd/Uqg7gy
About Navistar International
Navistar International Corporation (NYSE: NAV) --
http://www.Navistar.com/-- is a holding company whose
subsidiaries and affiliates subsidiaries produce International(R)
brand commercial and military trucks, MaxxForce(R) brand diesel
engines, IC Bus(TM) brand school and commercial buses, Monaco RV
brands of recreational vehicles, and Workhorse(R) brand chassis
for motor homes and step vans. It also is a private-label
designer and manufacturer of diesel engines for the pickup truck,
van and SUV markets. The company also provides truck and diesel
engine parts and service. Another affiliate offers financing
services.
The Company's balance sheet at April 30, 2011, showed $9.96
billion in total assets, $10.64 billion in total liabilities, $5
million in redeemable equity securities, $84 million in
convertible debt and a $769 million total stockholders' deficit.
Navistar has a 'BB-/Stable/--' corporate credit rating from
Standard & Poor's and a 'B1' Corporate Family Rating and
Probability of Default Rating from Moody's Investors Service.
Moody's said in October 2010 that Navistar's B1 rating could
improve if the North American truck market remains on track for a
sustained recovery into 2011, and Navistar's operational
initiatives to moderate its vulnerability to the truck cycle show
evidence of taking hold.
NEBRASKA BOOK: Wins Court Approval For $200-Mil. DIP Financing
--------------------------------------------------------------
Pete Brush at Bankruptcy Law360 reports that Nebraska Book Co. won
clearance Thursday in Delaware bankruptcy court to borrow $200
million, with JPMorgan Chase Bank NA acting as loan agent, in
order to continue business operations ahead of the late-summer
book-buying season.
Law360 relates that Delaware Bankruptcy Judge Peter J. Walsh
approved the debtor-in-possession financing, in the form of a
$125 million in term loans and a $75 million revolving credit
facility, on the same day the debtor won clearance to pay vendors,
employees and others continue to operate.
The DIP Facility consists of a $75 million revolving loan with a
base rate of +2.50% per annum and a $125 million term loan with a
base rate of +6.0% per annum.
All of the DIP obligations will constitute allowed senior
administrative expense claims.
Carve-Out means (a) any fees payable to the Clerk of Court and to
the Office of the U.S. Trustee; (b) up to $5,000,000 of allowed
fees, expenses and disbursements of professionals retained by the
Debtors or any official committee; and (c) any expenses incurred
by any Chapter 7 trustee provided those expenses do not exceed
$100,000 in the aggregate.
As security for the DIP Obligations, the DIP Lenders are granted a
first priority lien on all of the Debtors' property, a junior lien
on all of the Debtors' property that is subject to valid liens in
existence immediately prior to the Petition Date, and a first
priority lien on all Prepetition Collateral.
According to Marc Kieselstein, P.C., Esq., at Kirkland & Ellis
LLP, in New York, the Debtors are confident that their operational
initiatives will stabilize their financial performance and
position them in the marketplace for the long-term but the Debtors
still faced the near-maturity of $200 million in secured second
lien notes. In light of this pending maturity, the Debtors'
publishers expressed concern regarding the Debtors' ability to
honor their obligations for the "back-to-school" textbook and
merchandise purchaser.
A full-text copy of the Interim DIP Order is available for free
at http://ResearchArchives.com/t/s?7660
A full-text copy of the DIP Motion and the Budget is available for
free at http://bankrupt.com/misc/NEBRASKABOOK_dipfinancing.pdf
About Nebraska Book Company
Lincoln, Nebraska-based Nebraska Book Company, Inc., is one of the
leading providers of new and used textbooks for college students
in the United States. Nebraska Book and seven affiliates filed
separate Chapter 11 petitions (Bankr. D. Del. Case Nos. 11-12002
to 11-12009) on June 27, 2011. Hon. Peter J. Walsh presides over
the case. lawyers at Kirkland & Ellis LLP and Pachulski Stang
Ziehl & Jones LLP, serve as the Debtors' bankruptcy counsel. The
Debtors; restructuring advisors are AlixPartners LLC; the
investment bankers are Rothschild, Inc.; the auditors are Deloitte
& Touche LLP; and the claims agent is Kurtzman Carson Consultants
LLC. As of the petition date, the Debtors had consolidated assets
of $657,215,757 and debts of $563,973,688.
JPMorgan Chase Bank N.A., as administrative agent for the DIP
lenders, is represented by lawyers at Richards, Layton & Finger,
P.A., and Simpson Thacher & Bartlett LLP. J.P. Morgan Investment
Management Inc., the DIP arranger, is represented by lawyers at
Bayard, P.A., and Willkie Farr & Gallagher LLP.
An ad hoc committee of holders of more than 50% of the Debtors'
Second Lien Notes is represented by lawyers at Brown Rudnick. An
ad hoc committee of holders of the Debtors' 8.625% unsecured
notes are represented by Milbank, Tweed, Hadley & McCloy LLP.
The U.S. Trustee appointed in the case of the Debtor an official
creditors' committee composed of two indenture trustees and three
trade suppliers. Lowenstein Sandler LLP represents the Committee,
and Mesirow Financial Inc., serves as financial advisers.
NEXITY FINANCIAL: Case Converted to Chapter 7 Liquidation
---------------------------------------------------------
BankruptcyData.com reports that the U.S. Bankruptcy Court approved
Nexity Financial's motion for an order authorizing the Debtors to
convert their Chapter 11 reorganization case to Chapter 7
liquidation status.
As reported in the Troubled Company Reporter on June 6, 2011,
Nexity Financial asked the U.S. Bankruptcy Court for the District
of Delaware to (i) convert its case to one under Chapter 7 of the
Bankruptcy Code; and (ii) to direct the U.S. Trustee to appoint a
Chapter 7 trustee.
The Debtor submitted that conversion of the Chapter 11 case is
appropriate given its inability to confirm the prepackaged plan.
The Debtor adds that with the closing of Nexity Bank, the Debtor
has no remaining ability to reorganize. Moreover, the Debtor does
not believe that the value of its remaining funds is sufficient to
fund the drafting and solicitation of a chapter 11 liquidating
plan, or to make any distributions to creditors thereunder.
About Nexity Financial Corporation
Nexity Financial Corporation -- http://www.nexitybank.com/--
provides capital and support services for community banks. Its
bank subsidiary, Nexity Bank, is operating under a cease and
desist order issued by regulators. Birmingham, Alabama-based
Nexity had net losses of $26 million in 2009 and $13 million in
2008.
The Company filed for Chapter 11 bankruptcy protection (Bankr. D.
Del. Case No. 10-12293) on July 22, 2010. Drew G. Sloan, Esq.;
Mark D. Collins, Esq.; and Michael Joseph Merchant, Esq., at
Richards Layton & Finger, assist the Company in its restructuring
effort. The Company estimated its assets and debts at $10 million
to $50 million as of the Petition Date.
The U.S. Trustee did not establish an Official Committee of
Unsecured Creditors due to insufficient interest.
NEXITY FINANCIAL: Files Schedules of Assets and Liabilities
-----------------------------------------------------------
Nexity Financial Corporation, 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 $0
B. Personal Property $817,031
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $14,370,241
E. Creditors Holding
Unsecured Priority
Claims unknown
F. Creditors Holding
Unsecured Non-priority
Claims $22,000,000
----------- --------------
TOTAL $817,031 $39,370,241
About Nexity Financial Corporation
Nexity Financial Corporation -- http://www.nexitybank.com/--
provides capital and support services for community banks. Its
bank subsidiary, Nexity Bank, is operating under a cease and
desist order issued by regulators. Birmingham, Alabama-based
Nexity had net losses of $26 million in 2009 and $13 million in
2008.
The Company filed for Chapter 11 bankruptcy protection (Bankr. D.
Del. Case No. 10-12293) on July 22, 2010. Drew G. Sloan, Esq.;
Mark D. Collins, Esq.; and Michael Joseph Merchant, Esq., at
Richards Layton & Finger, assist the Company in its restructuring
effort. The Company estimated its assets and debts at $10 million
to $50 million as of the Petition Date.
The U.S. Trustee did not establish an Official Committee of
Unsecured Creditors due to insufficient interest.
NEXSTAR FINANCE: Moody's 'B3' Corporate Unaffected by New Plans
---------------------------------------------------------------
Moody's Investors Service said Nexstar Broadcasting's announced
plan to explore strategic alternatives, including a possible sale
of the company, does not impact the B3 corporate family rating of
Nexstar Finance Holdings, Inc. (Nexstar) given the absence of a
timeframe and lack of clarity on possible outcomes.
A sale to a private equity sponsor could increase leverage and
negatively impact the credit profile, whereas a sale to a
strategic operator, depending on the financing, could enhance
scale and improve the credit profile. Moody's will continue to
monitor developments in the process and comment as more
information becomes available.
The principal methodologies used in rating this issuer were Global
Broadcast Industry published in June 2008 and Loss Given Default
for Speculative-Grade Non-Financial Companies in the U.S., Canada
and EMEA published in June 2009.
Based in Irving, Texas, Nexstar owns, operates, programs or
provides sales and other services to 63 television stations and
related digital signals in 34 markets in 14 states and reaches
approximately 13 million viewers. Its annual revenue in 2010 was
$313 million.
NO FEAR: U.K. Sports Retailer Wins Auction for No Brand
-------------------------------------------------------
Dow Jones' DBR Small Cap reports that a subsidiary of U.K.
retailer Sports Direct International PLC won approval to buy the
edgy No Fear clothing brand while a handful of the company's
creditors work to organize a new retail concept that would take
over some of the chain's struggling West Coast stores.
About No Fear Retail
Carlsbad, California-based No Fear Retail Stores, Inc., is a
retailer of action, sports, and casual youth lifestyle apparel and
accessories, targeting young adults and teens. It operates 41
retail locations in California, Oregon, Arizona, Florida, Nevada,
North Carolina, and Texas.
No Fear filed for Chapter 11 bankruptcy protection (Bankr. S.D.
Calif. Case No. 11-02896) on Feb. 24, 2011. David S. Kupetz,
Esq., at Sulmeyer, Kupetz, A Professional Corp, serves as the
Debtor's bankruptcy counsel. The Debtor tapped Jones Day as
special intellectual property counsel; Avant Advisory Group's
George Blanco as chief restructuring officer, and Venturi &
Company LLC, as financial advisors.
The Debtor estimated disclosed $31,648,063 in assets and
$12,552,985 in liabilities as of the Chapter 11 filing.
Affiliates No Fear MX, Inc. (Bankr. S.D. Calif. Case No. 11-02897)
and Simo Holdings, Inc. (Bankr. S.D. Calif. Case No. 11-02898)
filed separate Chapter 11 petitions on Feb. 24, 2011.
Tiffany L. Carroll, the Acting U.S. Trustee for Region 15,
appointed three creditors to serve on an Official Committee of
Unsecured Creditors of No Fear MX, Inc. Pachulski Stang
Ziehl & Jones LLP represents the Committee. BDO USA LLP serves as
financial advisor to provide financial advisory services to the
Committee.
OPEN SOLUTIONS: Bank Debt Trades at 13% Off in Secondary Market
---------------------------------------------------------------
Participations in a syndicated loan under which Open Solutions,
Inc., is a borrower traded in the secondary market at 86.90 cents-
on-the-dollar during the week ended Friday, July 22, 2011, an
increase of 0.25 percentage points from the previous week
according to data compiled by Loan Pricing Corp. and reported in
The Wall Street Journal. The Company pays 212.5 basis points
above LIBOR to borrow under the facility. The bank loan matures
on Jan. 18, 2014, and carries Moody's B1 rating and Standard &
Poor's BB- rating. The loan is one of the biggest gainers and
losers among 208 widely quoted syndicated loans with five or more
bids in secondary trading for the week ended Friday.
Headquartered in Glastonbury, Conn., Open Solutions, Inc., is a
privately held provider of core data processing and information
management software solutions for financial institutions including
community banks / thrifts and credit unions. In January 2007, the
company was acquired by The Carlyle Group and Providence Equity
Partners in a leveraged transaction of roughly $1.4 billion
including the assumption of debt.
OPTI CANADA: Enters Into Arrangement Agreement with CNOOC Limited
-----------------------------------------------------------------
OPTI Canada Inc. entered into an agreement with CNOOC Luxembourg
S.a r.l, an indirect wholly-owned subsidiary of CNOOC Limited,
pursuant to which indirect wholly-owned subsidiaries of CNOOC
Limited, will acquire the Second Lien Notes and all of the
outstanding shares of OPTI. The total value of the Transaction is
approximately US$2.1 billion, which includes net consideration of
US$1,179 million payable to holders of OPTI's Second Lien Notes,
US$37.5 million payable to backstop parties, US$34 million payable
to shareholders and the assumption of US$825 million First Lien
Notes. CNOOC Limited is China's largest producer of offshore
crude oil and natural gas and one of the largest independent oil
and gas exploration and production companies in the world.
Pursuant to the terms of the Arrangement Agreement, CNOOC Limited,
through its subsidiaries, will:
* acquire OPTI's US$1 billion 8.25 percent Senior Secured
Notes due 2014 and US$750 million 7.875 percent Senior
Secured Notes due 2014 for a net cash payment of US$1,179
million;
* acquire all existing issued and outstanding common shares
of OPTI for a cash payment of US$34 million equal to
US$0.12 per common share; and
* assume, in accordance with the notes' indentures, the
Company's US$300 million 9.75 percent First Lien Notes due
2013 and its US$525 million 9.00 percent First Lien Notes
due 2012.
The Board of Directors of OPTI has determined that the Transaction
is in the best interest of the Company and voted unanimously in
favour of the Transaction.
Chris Slubicki, President and Chief Executive Officer of OPTI
stated, "We are very pleased with this transaction and believe it
is in OPTI's best interest. CNOOC Limited is a technically
experienced and well-capitalized company that is equipped to
support further development at Long Lake and future expansions in
the Canadian oil sands."
Mr. Yang Hua, Chief Executive Officer of CNOOC Limited commented,
"The transaction strengthens our Canadian presence in the oil
sands business. We believe that upside potential of the assets
will facilitate local energy supply and our production growth in
the long term."
The Transaction is subject to approval by a majority in number,
representing at least 66 2/3 percent of the principal amount, of
votes cast by the holders of the Company's Second Lien Notes.
OPTI has received executed support agreements from holders of
approximately 55 percent of the principal amount of the Second
Lien Notes pursuant to which they have agreed to vote in favour of
the Transaction. If the Transaction is terminated, other than
pursuant to a Superior Proposal, the parties to the Support
Agreements have agreed, in certain circumstances, to pursue the
restructuring plan outlined in the Company's press release dated
July 13, 2011. The Noteholder Meeting regarding these matters is
expected to occur in September 2011.
The Transaction is subject to certain terms and conditions
including, among other things, applicable government and
regulatory approvals by relevant authorities in Canada and the
People's Republic of China, and Alberta court approval. The
Transaction is expected to close in the fourth quarter of 2011.
It is expected that the Transaction will not be subject to a vote
of the shareholders of OPTI.
The Transaction will be effected by way of a plan of arrangement
through concurrent proceedings under the Companies' Creditors
Arrangement Act and the Canada Business Corporations Act. All of
OPTI's trade creditors and its project operator, Nexen Inc., will
be paid in the ordinary course.
Scotia Waterous Inc. and TD Securities Inc. are acting as
financial advisors to OPTI on the Transaction and Macleod Dixon
LLP is acting as legal advisor to OPTI on the Transaction and in
connection with the restructuring. Lazard Freres & Co. is acting
as advisor to OPTI in connection with the restructuring. The
Supporting Noteholders are being advised by Canaccord Genuity
Corp. and Bennett Jones LLP. More information about OPTI's plan
of arrangement proceedings can be found at www.opticanada.com.
About OPTI
OPTI Canada Inc. is a Calgary, Alberta-based company focused on
developing major oil sands projects in Canada. Its first project,
the Long Lake Project, has a design capacity for 72,000 barrels
per day (bbl/d), on a 100 percent basis, of SAGD (steam assisted
gravity drainage) oil production integrated with an upgrading
facility. The Upgrader uses the Company's proprietary OrCrude(TM)
process, combined with commercially available hydrocracking and
gasification. OPTI's common shares trade on the Toronto Stock
Exchange under the symbol OPC.
OPTI on July 13, 2011, reached agreement with a committee of
Secured Notes holders to restructure the Company's balance sheet
under the Companies' Creditors Arrangement Act. At June 30, 2011,
OPTI had roughly C$189 million in cash and cash equivalents. In
addition, it holds restricted cash of US$73 million in an interest
reserve account associated with its US$300 million First Lien
Notes.
PAUL TRANSPORTATION: Lyle Nelson Appointed as Liquidating Trustee
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Oklahoma
appointed Lyle R. Nelson as trustee of the Liquidating Trust,
pursuant to the terms of Paul Transportation, Inc.'s First Amended
Plan of Reorganization as of Feb. 28, 2011, and the Liquidating
Trust Agreement.
All notices, payments, requests, reports, information and other
communication between the parties of the Liquidating Trust, or
otherwise to be made to the Liquidating Trustee, will be addressed
as:
Lyle R. Nelson
Two Leadership Share, Suite 1300
211 N. Robinson
Oklahoma City, OK 73102
Tel: (405) 232-4021
Fax: (405) 232-3746
E-mail: lyle@lylenelsonlaw.com
The members of the Advisory Committee will be: (1) Chuck Carper,
and (2) Sandy Curtin.
No bond is required for the trustee.
About Paul Transportation
Enid, Oklahoma-based Paul Transportation Inc. provides flatbed
transportation services across the lower 48 states. The Debtor
hauls a variety of goods, including pipe, steel, wallboard, coils,
paper, lumber and other products used in the construction and oil
and gas industries. The Debtor maintains service terminals in
Oklahoma City, Oklahoma; Houston, Texas; and Fort Dodge,Iowa.
Troy Paul is the Debtor's sole shareholder, officer and
stockholder. The Debtor employs 142 people. In addition, the
Debtor also contracts with approximately 67 independent owner-
operator drivers.
Paul Transportation filed for Chapter 11 bankruptcy protection
(Bankr. W.D. Okla. Case No. 10-13022) on May 18, 2010. Matthew C.
Goodin, Esq., and Stephen W. Elliott, Esq., at Kline, Kline,
Elliott & Bryant, assist the Debtor in its restructuring effort.
Lyle R. Nelson, Esq., L. Vance Brown, Esq., Eric Huddleston, Esq.,
an Karolina D. Roberts, Esq., at Elias, Books, Brown & Nelson, PC,
represent the Official Committee of Unsecured Creditors.
In its schedules, the Debtor reported $38,249,443 in total assets
and $23,535,843 in total liabilities.
Richard A. Wieland, the U.S. Trustee for Region 20, appointed
three members to the official committee of unsecured creditors in
the Debtor's case.
PETSMART INC: S&P Affirms Corporate Credit Rating at 'BB'
---------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Phoenix-
based PetSmart Inc. to positive from stable. "At the same time, we
affirmed our 'BB' corporate credit rating on the company," S&P
said.
"The rating on PetSmart reflects our expectation for operational
stability and modest improvement of credit measures over the near
term," said Standard & Poor's credit analyst Mariola Borysiak. "We
expect profitability to keep benefiting from stronger sales and
improving sales mix as consumers continue to shift back to higher
margin discretionary products."
PHILLIPS RENTAL: Parties-in-interest Want Plan Outline Disapproved
------------------------------------------------------------------
Creditors and parties-in-interest Citizens Bank and Regions Bank,
ask the U.S. Bankruptcy Court for the Eastern District of
Tennessee to deny approval of Phillips Rental Properties, LLC's
disclosure statement explaining the proposed plan of
reorganization.
Citizens Bank asserts that:
a. The Plan does not comply with Section 1122 of the Bankruptcy
Code. In the instant case the Debtor has created one class
(Class Three) of secured claims: Citizens Bank retains a first
mortgage on real estate located at Pecan Wood, 6 York Circle,
702 Swadley Road, 39 Embassy Row, and 419 Cottonwood. It is
believed that no other secured creditor within the class
retains a lien on this property. Secured creditors with claims
against different properties are generally required to be
placed in separate classes.
b. The Plan violates Section 1129(a)(5) because no
identification of the Debtor's future directors, officers, or
voting trustees has been provided. Moreover, there is no
identification of the continued relationship of insiders in the
reorganized Debtor.
Citizens Bank is represented by:
Douglas L. Payne, Esq.
401 West Irish Street
Greeneville, TN 37743
Tel: (423) 639-2220
In a separate motion, Regions Bank, asks the Court to direct the
Debtor to amend or otherwise revise the Disclosure Statement so as
to provide adequate information.
The bank asserts that the disclosure statement provides only
superficial information, omits important details, and fails to
provide adequate information to allow a hypothetical investor to
determine whether to accept or reject the proposed Plan.
The bank says that the Debtor has not provided an estimated return
that creditors would receive in a liquidation. According to the
bank, the absence of any numerical values suggests that the Debtor
has not conducted a thoughtful analysis, which is necessary given
that by its own estimate the value of its assets exceeds its
liabilities by over $4.2 million.
The bank adds that the Debtor appears to assert that it has some
type of claim or cause of action against Regions Bank, but it has
provided no information about such claim(s). If this asset
exists, the Debtor must explain and value the asset. It has not
done so.
Regions Bank is represented by:
Walter N. Winchester, Esq.
WINCHESTER, SELLERS, FOSTER & STEELE, P.C.
P.O. Box 2428
Knoxville, TN 37901-2428
Tel: (865) 637-1980
The Debtor submitted to the Court a plan of reorganization and
disclosure statement dated June 16.
The Plan reflects a payment schedule for the Debtor's secured loan
claims. The Debtor says it is simultaneously pursuing additional
refinancing options which would pay secured creditors the full
principal balance.
Under the Plan, unsecured non-priority claims will be paid over a
60-month period. These claims will have a 100% pay-off of the
principal balance of claims, which the Debtor estimates to be
$70,264.
A copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/PHILLIPSRENTAL_Jun16DS.pdf
The Debtor believes that unsecured creditors will be paid more
from the payments described under the Plan from its continued
operation than unsecured creditors would receive in liquidation.
In light of the proposed Plan, the Debtor's request for an
extension of its exclusive plan filing period has been withdrawn.
As previously reported by The Troubled Company Reporter, the
Debtor sought a 45-day extension from June 4 of its exclusivity
period. Several creditors, including TriSummit Bank, Regions Bank
and Citizens Bank expressed objection to the request.
About Phillips Rental Properties
Piney Flats, Tennessee-based Phillips Rental Properties, LLC,
filed for Chapter 11 bankruptcy protection (Bankr. E.D. Tenn. Case
No. 10-53129) on Dec. 7, 2010. Fred M. Leonard, Esq. --
fredmleonard@earthlink.net -- in Bristol, Tennessee, serves as the
Debtor's bankruptcy counsel. According to its schedules, the
Debtor disclosed $13,499,682 in total assets and $9,650,892 in
total liabilities. No unsecured creditors committee has been
appointed in the case.
PLATINUM PROPERTIES: Final Stipulation for Cash Use Approved
------------------------------------------------------------
The Hon. Basil H. Lorch III of the U.S. Bankruptcy Court for the
Southern District of Indiana approved the final stipulations
authorizing Platinum Properties, LLC's to use the cash collateral.
The stipulation approved were entered among the Debtor and:
-- Arbor Homes;
-- First Financial Bank, as trustee of the James J. Nelson
IRA Trust;
-- First Internet Bank; and
-- The Ralph L. Wilfong, II Charitable Remainder Unitrust.
As reported in the Troubled Company Reporter on July 6, 2011,
the Debtors are authorized to use cash collateral to pay the
necessary and reasonable expenses of operating their businesses,
including without limitation, payroll expenses, utility services,
payroll taxes, insurance, supplies and equipment, vendor and
supplier services, and other expenditures as are necessary for
operating the Debtors' businesses. The Debtors are also
authorized to make payments authorized under other orders entered
by the Court, including for payment of professional and other
administrative expenses.
Full-text copies of the Cash Collateral Stipulations are available
for free at:
http://bankrupt.com/misc/PlatinumProp_MKChristelCashCollStip.pdf
http://bankrupt.com/misc/PlatinumProp_ArborHomesCashCollStip.pdf
http://bankrupt.com/misc/PlatinumProp_FarraCashCollStip.pdf
http://bankrupt.com/misc/PlatinumProp_FirstInternetCashCollStip.pdf
http://bankrupt.com/misc/PlatinumProp_RalphCashCollStip.pdf
About Platinum Properties and PPV LLC
Indianapolis, Indiana-based Platinum Properties, LLC, is a
residential real estate developer. Platinum acquires land, designs
the projects, obtains zoning and other approvals, and constructs
roads, drainage, utilities, and other infrastructure of
residential subdivisions. Platinum then sells the finished,
platted lots. Platinum also has an ownership interest in several
special purpose entities that in turn own, operate and manage
individual projects.
PPV LLC is a joint venture between Platinum and a non-debtor
entity, Pittman Partners, Inc., each of whom hold an equity
interest in PPV. PPV owned four projects directly and owns 100%
of the membership interest of Sweet Charity Estates, LLC.
Platinum Properties and PPV LLC filed for Chapter 11 protection
(Bankr. S.D. Ind. Case Nos. 11-05140 and 11-05141) on April 25,
2011. Lawyers at Baker & Daniels serve as the Debtors' bankruptcy
counsel. Platinum Properties disclosed $14,624,722 in assets and
$181,990,960 in liabilities as of the Chapter 11 filing.
The U.S Trustee has not yet appointed a creditors committee in the
Debtor's case. The U.S. Trustee reserves the right to appoint
such a committee should interest developed among the creditors.
PLATINUM PROPERTIES: Can Sell Assets to Indiana Bank for $4-Mil.
----------------------------------------------------------------
The Hon. Basil H. Lorch III of the U.S. Bankruptcy Court for the
Southern District of Indiana authorized Platinum Properties, LLC
to sell two real estates properties known as Abney Glen and Mount
Vernon Trails to Indiana Bank and Trust Company, free and clear of
liens.
The Court also authorized the assumption and assignment of assumed
contracts and leases.
As reported in the Troubled Company Reporter on June 29, 2011, The
Abney Glen Property is located in Carmel, Indiana. The Mount
Vernon Trails Property is located in Fortville, Indiana. Both
properties were appraised to have a cumulative as-is value of
$4.03 million.
The purchaser is the lender of the properties. The properties are
cross-collaterized and secure the Debtor's total indebtedness to
IBT of $6.06 million.
IBT will purchase the properties for the total amount of the
indebtedness. Upon the sale closing, IBT agreed to release the
balance of the indebtedness and waive all claims against the
Debtor.
About Platinum Properties and PPV LLC
Indianapolis, Indiana-based Platinum Properties, LLC, is a
residential real estate developer. Platinum acquires land, designs
the projects, obtains zoning and other approvals, and constructs
roads, drainage, utilities, and other infrastructure of
residential subdivisions. Platinum then sells the finished,
platted lots. Platinum also has an ownership interest in several
special purpose entities that in turn own, operate and manage
individual projects.
PPV LLC is a joint venture between Platinum and a non-debtor
entity, Pittman Partners, Inc., each of whom hold an equity
interest in PPV. PPV owned four projects directly and owns 100%
of the membership interest of Sweet Charity Estates, LLC.
Platinum Properties and PPV LLC filed for Chapter 11 protection
(Bankr. S.D. Ind. Case Nos. 11-05140 and 11-05141) on April 25,
2011. Lawyers at Baker & Daniels serve as the Debtors' bankruptcy
counsel. Platinum Properties disclosed $14,624,722 in assets and
$181,990,960 in liabilities as of the Chapter 11 filing.
The U.S Trustee has not yet appointed a creditors committee in the
Debtor's case. The U.S. Trustee reserves the right to appoint
such a committee should interest developed among the creditors.
POST STREET: Taps Stutman Treister as Reorganization Counsel
------------------------------------------------------------
Post Street, LLC, asks the U.S. Bankruptcy Court for the Northern
District of California for permission to employ Stutman, Treister
& Glatt Professional Corporation as reorganization counsel to
represent the Debtor in the Chapter 11 proceedings.
ST&G received $22,610 for prepetition services rendered. The
amount came from the $280,000 retainer that ST&G received for
services to be rendered and expenses to be incurred in connection
with the Debtor's Chapter 11 case. The Debtor does not owe ST&G
any amount for prepetition services. As of the Petition Date,
$257,989 of the retainer remains in a segregated interest-bearing
trust account.
Stanley Gribble, the sole member and sole manager of the Debtor
advanced the retainer on behalf of the Debtor.
To the best of the Debtor's knowledge, ST&G is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.
About Post Street LLC
Post Street LLC, based in San Francisco, California, filed for
Chapter 11 bankruptcy (Bankr. Case No. 11-32255) on June 15, 2011.
Judge Thomas E. Carlson presides over the case. Eric D. Goldberg,
Esq., at Stutman, Treister and Glatt, serves as the Debtor's
bankruptcy counsel. The Debtor disclosed assets of $3,316 plus
unknown amount and liabilities of $55,906,564 as of the Chapter 11
filing. The petition was signed by Stanley W. Gribble, authorized
agent.
POST STREET: LZSH to Handle Disputes with PIL/Eurohypo, et al.
--------------------------------------------------------------
Post Street, LLC, asks the U.S. Bankruptcy Court for the Northern
District of California for permission to employ Lurie, Zepeda,
Schmalz & Hogan, A Professional Corporation, as special litigation
counsel.
Prepetition, LZSH represented and advised the Debtor in connection
with the Debtor's disputes with Eurohypo AG, New York Branch Loan
to Post Investors LLC, an affiliate of Square Mile Capital
Management, LLC, and First American Title Insurance Company,
including representing the Debtor, Festival Retail Fund 1 228 Post
Street, LP and Stanley Gribble, the Debtor's sole member.
The Debtor owns a 34.41% tenant in common interest in a commercial
building located at 228-240 Post Street, in San Francisco,
California. Festival owns the other 65.59% tenant in common
interest in the property.
The Debtor wishes to employ Bruce J. Lurie, Andrew W. Zepeda,
Lawrence J. Imel and other members, associates, and of-counsel
attorneys of LZSH, as the Debtor's special litigation counsel.
In a separate motion, the Debtor requested for permission to
employ Nossaman LLP as special litigation counsel.
During one year prior to the Petition Date, LZSH did not receive
any compensation from the Debtor. LZSH received compensation in
the aggregate amount of $100,000 from Mr. Gribble for prepetition
services rendered. As of the Petition Date, the LZSH holds a
claim totaling approximately $165,800 for prepetition services
rendered on behalf of the Debtor, Festival and Mr. Gribble.
To the best of the Debtor's knowledge, LZSH is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.
About Post Street LLC
Post Street LLC, based in San Francisco, California, filed for
Chapter 11 bankruptcy (Bankr. Case No. 11-32255) on June 15, 2011.
Judge Thomas E. Carlson presides over the case. Eric D. Goldberg,
Esq., at Stutman, Treister and Glatt, serves as the Debtor's
bankruptcy counsel. The Debtor disclosed assets of $3,316 plus an
unknown amount and liabilities of $55,906,564 as of the Chapter 11
filing. The petition was signed by Stanley W. Gribble, authorized
agent.
POST STREET: Taps Nossaman LLP as PIL/Eurohypo Litigation Counsel
-----------------------------------------------------------------
Post Street, LLC, asks the U.S. Bankruptcy Court for the Northern
District of California for permission to employ Nossaman LLP as
special litigation counsel.
Prepetition, Nossaman represented and advised the Debtor in
connection with its dispute with Eurohypo AG, New York Branch
Loan to Post Investors LLC, as local San Francisco counsel to
Lurie Zepeda Schmals & Hogan, which is based in Beverly Hills,
California. The representation included representing the Debtor
in the civil action before the Superior Court of the State of
California, County of San Francisco.
The Debtor wishes to employ Brendan F. Macaulay, and other
members, associates, and of-counsel attorneys of Nossaman.
Nossaman's role would be limited to a local counsel role, with
LZSH providing great majority of the services in the PIL Eurohypo
litigation.
In a separate motion, the Debtor requested for permission to
employ Lurie, Zepeda, Schmalz & Hogan, A Professional Corporation,
as special litigation counsel.
Prepetition, Nossaman received compensation in the aggregate
amount of $5,000. As of the petition date, the Debtor owes
Nossaman $11,688 for prepetition services.
To the best of the Debtor's knowledge, Nossaman is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
About Post Street LLC
Post Street LLC, based in San Francisco, California, filed for
Chapter 11 bankruptcy (Bankr. Case No. 11-32255) on June 15, 2011.
Judge Thomas E. Carlson presides over the case. Eric D. Goldberg,
Esq., at Stutman, Treister and Glatt, serves as the Debtor's
bankruptcy counsel. The Debtor disclosed assets of $3,316 plus
unknown amount and liabilities of $55,906,564 as of the Chapter 11
filing. The petition was signedby Stanley W. Gribble, authorized
agent.
POTTERS HOLDINGS: S&P Assigns 'B' Corporate Credit Rating
---------------------------------------------------------
Standard & Poor's Ratings Services assigned a 'B' corporate credit
rating to Malvern, Pa.-based Potters Holdings II L.P. The outlook
is stable.
At the same time, Standard & Poor's assigned 'B' issue-level
ratings (same as the corporate credit rating) and '3' recovery
ratings to Potters' $190 million first-lien facilities, consisting
of a $40 million revolving credit facility due 2016 (undrawn at
close) and a $150 million term loan B due 2017. The '3' recovery
rating indicates the expectation of meaningful recovery (50% to
70%) in the event of a payment default.
Standard & Poor's also assigned a 'CCC+' issue-level rating (two
notches below the corporate credit rating) and a '6' recovery
rating to the $112.5 million second-lien term loan due 2017. The
'6' recovery rating indicates the expectation of negligible
recovery (0% to 10%) in the event of a payment default.
With revenues greater than $275 million, Potters is a global
producer of solid and hollow glass spheres for use in highway
safety and in applications for polymer additives, metal finishing,
and conductive materials. The stable outlook reflects the
expectation that end-market demand should support the company over
the next few years.
Potters' highly leveraged financial profile and ownership
constrain the ratings. Potters is an unrestricted subsidiary that
is 100% owned by PQ Corp., which sought the separation financing.
Proceeds from the debt issuance were used to pay down
approximately $245 million of first-lien debt under PQ's credit
facility, with the balance for expenses and a small amount of
balance sheet cash. There is no change in equity ownership through
this transaction, and The Carlyle Group will remain the majority
owner of both companies (INEOS Group will continue to hold a large
part of the remainder, with the balance held by management).
Standard & Poor's characterizes The Carlyle Group's financial
policies as very aggressive. "We expect that growth investments,
including acquisitions, could be a prioritized use for free
operating cash flow," said Standard & Poor's credit analyst Ket
Gondha.
"The ratings also reflect the company's status as a newly
independent entity and the challenges associated with establishing
independent management functions," Mr. Gondha continued.
Since Potters has separated from PQ, it does not have a history as
an independent entity, and this provides limited visibility into
how the entity will perform once independent. In addition, various
corporate functions throughout the company are unfilled or
nonexistent. To help ensure a smooth transition, Potters has a
three-year transition service agreement that will enable it to
continue various support services historically provided by PQ.
PRM SMITH: Disclosure Statement Hearing Set for June 23
-------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas
scheduled the hearing on the disclosure statement explaining the
plan of reorganization filed by PRM Smith Bay, LLC, for June 23,
2011, at 01:30 p.m.
According to a May 10, 2011 report by The Troubled Company
Reporter, under the Plan, the Reorganized Debtor will develop or
sell the Cabes Point property over a period of up to five years
following the Effective Date.
The Plan classifies 5 classes of claims and interests.
Administrative claims under Class 1 will be paid in full on the
Plan's Effective Date.
Priority tax claims under Class 2 will be paid over a period not
exceeding 6 years after the date of assessment of the claims,
commencing after the first full quarter following the Effective
Date.
The Class 3 Claim of FirstBank will be treated as a fully Secured
Claim in an amount to be determined by the Bankruptcy Court at the
Confirmation Hearing, or as otherwise agreed to prior to such
hearing by the Debtor and FirstBank. The existing loan documents
between the Debtor and FirstBank will be assumed fully by the
Reorganized Debtor with the following exceptions: a) the maturity
date of the loan will be five (5) years from the Effective Date;
b) interest will accrue at the rate of six percent (6%) per annum.
The Claim, plus any accrued but unpaid interest on such Claim,
will be due and payable in full on the maturity date.
Creditors holding Allowed Class 4 General Unsecured Claims will
receive 100% of their Allowed Claims from proceeds of the
development or sale of the Property.
The Class 5 Equity Owner will retain its interest in Debtor, in
exchange for its providing for funding of the Plan and its
commitment to use its skill, effort, and experience to develop the
Property for the benefit of the Creditors.
Classes 3, 4, and 5 are all impaired under the Plan.
A copy of the Disclosure Statement is available for free at:
http://bankrupt.com/misc/prmsmith.DS.pdf
Chicago, Illinois-based PRM Smith Bay, LLC, aka PRM Smith Bay,
LLP, was formed in May 2004 for the purpose of holding an
undeveloped 7.5 acre parcel of land on St. Thomas in the United
States Virgin Islands known as Cabes Point. PRM Realty Group,
LLC, is the 100% ownere and manager of the Debtor. The
Debtorfiled for Chapter 11 bankruptcy protection (Bankr. N.D. Tex.
Case No. 11-30444) on Jan. 20, 2011. Gerrit M. Pronske, Esq.,
Rakhee V. Patel, Esq., and Melanie P. Goolsby, Esq., at Pronske &
Patel, P.C., in Dallas, serve as the Debtor's bankruptcy counsel.
In its schedules, the Debtor disclosed $13,031,162 in assets and
$6,781,074 in liabilities as of the petition date.
Affiliates Bon Secour Partners, LLC (Bankr. N.D. Tex. Case No.
09-37580), PRS II, LLC (Bankr. N.D. Tex. Case No. 09-31436), PRM
Realty Group, LLC (Bankr. N.D. Tex. Case No. 10-30241), PMP II,
LLC (Bankr. N.D. Tex. Case No. 10-30252), Maluhia Development
Group, LLC (Bankr. N.D. Tex. Case No. 10-30475), Maluhia One, LLC
(Bankr. N.D. Tex. Case No. 10-30987), Maluhia Eight, LLC (Bankr.
N.D. Tex. Case No. 10-30986), Maluhia Nine, LLC (Bankr. N.D. Tex.
Case No. 10-30988), Long Bay Partners, LLC (Bankr. N.D. Tex. Case
No. 10-35124), PRM Development, LLC (Bankr. N.D. Tex. Case No. 10-
35547), Little Hans Lollik Holdings, LLP (Bankr. N.D. Tex. Case
No. 10-36159), and Hans Lollick Land Company, Limited (Bankr. N.D.
Tex. Case No. 10-36161) filed separate Chapter 11 petitions.
QUALITY DISTRIBUTION: Amends $35 Million Securities Offering
------------------------------------------------------------
Quality Distribution, Inc., filed with the U.S. Securities and
Exchange Commission Amendment No. 1 to Form S-3 registration
statement relating to the offer and sale, from time to time, in
one or more series or issuances and on terms that the Company will
determine at the time of the offering, any combination of the
securities described in this prospectus, up to an aggregate amount
of $35,000,000. In addition, the Company's stockholders may offer
and resell, from time to time, up to 7,882,530 shares of the
Company's common stock.
The Company's common stock is traded on The NASDAQ Global Market
under the symbol "QLTY." The amendment provides that the last
reported sale price of the Company's common stock on July 19,
2011, was $12.24 per share.
A full-text copy of the amended prospectus is available for free
at http://is.gd/9DbnFN
About Quality Distribution
Quality Distribution, LLC, and its parent holding company, Quality
Distribution, Inc., are headquartered in Tampa, Florida. The
company is a transporter of bulk liquid and dry bulk chemicals.
The company's 2010 revenues are approximately $686 million.
Apollo Management, L.P., owns roughly 30% of the common stock of
Quality Distribution, Inc.
The Company's balance sheet at March 31, 2011, showed
$281.43 million in total assets, $405.83 million in total
liabilities, and a $124.40 million total shareholders' deficit.
* * *
As reported by the Troubled Company Reporter on Feb. 18, 2011,
Moody's Investors Service said the $38 million public offering of
4 million shares of Quality Distribution's common stock on Feb. 9,
2011, does not affect Quality's 'Caa1' corporate family and
probability of default ratings with a positive outlook. However,
Moody's notes that the intended debt reduction at par from $17.5
million of the proceeds would be viewed favorably.
In the Nov. 8, 2010 edition of the TCR, Standard & Poor's Ratings
Services said that it has raised its corporate credit ratings on
U.S.-based Quality Distribution Inc. to 'B' from 'B-'. S&P also
removed the ratings from CreditWatch, where S&P had placed them
with positive implications on Oct. 28, 2010, following the launch
of the bond offering. The outlook is stable.
"The rating action reflects the improvement in Quality
Distribution's financial profile after completing its
refinancing," said Standard & Poor's credit analyst Anita Ogbara.
"Following the transaction, S&P expects Quality Distribution to
benefit from lower interest expense, improved cash flow adequacy,
and a substantial reduction in debt maturities over the next few
years."
QUEBEC LP: S&P Assigns Preliminary 'B' Corporate Credit Rating
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary 'B'
corporate credit rating to New Jersey-based Quebec LP (d/b/a
Clement Pappas), following the announcement of Clement Pappas'
acquisition by Lassonde Industries (not rated). The outlook is
stable.
"At the same time, we assigned our preliminary 'B' issue level
rating to the company's $230 million senior secured term loan due
2017. The preliminary recovery ratings are '4', indicating our
expectation of average (30% to 50%) recovery for creditors in the
event of a payment default," S&P related.
"Our ratings are based on preliminary documentation and subject to
review of final documentation. Upon review of final documentation
we will issue our final ratings, which may change from our
preliminary ratings. We estimate Clement Pappas will have about
$254 million in reported debt outstanding following the
transaction," S&P stated.
"We believe credit measures will remain consistent with 'B' rating
category medians over the near term, including pro forma adjusted
leverage of 4.5x for the fiscal year ending September 2010, which
we estimate could improve to about 4x in fiscal 2012," said
Standard & Poor's credit analyst Rick Joy. "Although pro forma
funds from operations to total debt will be about 22% for fiscal
year ending September 2010, we forecast fiscal 2012 FFO to total
debt will decline to about 15% as a result of margin pressure."
The outlook on Clement Pappas is stable. Standard & Poor's expects
the company's operating performance to remain relatively stable
over the near-to-intermediate term and credit metrics to remain in
line with its rating category medians. "We could consider a lower
rating if operating performance deteriorates, the company's
financial policy becomes more aggressive, and/or liquidity becomes
constrained, including covenant cushion decreasing well below 20%.
However, though unlikely in the near term, we could consider
raising the rating if the company is able to further diversify its
business line and product offerings."
QUEPASA CORP: Inks Pact to Acquire myYearbook for $100 Million
--------------------------------------------------------------
Quepasa Corporation announced has executed a definitive agreement
to merge with Insider Guides, Inc., DBA myYearbook, for $100
million, comprised of approximately $82 million in Quepasa common
stock and approximately $18 million in cash.
"With this merger, we intend to create nothing less than the
public market leader in social discovery," noted Quepasa CEO, John
Abbott. "Combination with myYearbook nearly doubles the size of
Quepasa's existing user base while positioning the new company for
significantly higher growth in mobile and social games,
advertising, and virtual currency. The myYearbook team is
product-oriented and hungry to continue building innovative
products at the convergence of social and mobile. We expect the
scale of this combination to enable a new class of investor in
Quepasa. We believe myYearbook's proven track record in
monetization and engagement will fuel significant future growth."
Over the past 12 months, myYearbook has experienced rapid growth
in users and in mobile traffic. With over 1 billion page views on
mobile platforms and 1.2 billion page views on the web each month,
myYearbook is one of the largest media properties in the US. It
is also the #1 Web site in the comScore Teens category with more
visits, minutes, and pageviews than any other site in the
category. By emphasizing social discovery, focusing on the people
users want to know rather than the people they already know, the
service has built a large and growing user base, especially in the
teen and young adult demographic. In 2010, myYearbook generated
$23.7 million in revenue, up 53% year-over-year, and EBITDA of
$4.9 million, up 315% year-over-year.
"We are thrilled to bring our vision of social discovery to a
global audience through combination with Quepasa," noted Geoff
Cook, CEO of myYearbook. "Meeting new people is now -- and has
always been -- one of the Internet's core activities. This
combination creates the scale needed to build the #1 player in
social discovery. What excites me most about this opportunity is
applying myYearbook's platform for monetization and engagement to
Quepasa's fast-growing markets while also doubling the size of our
development team to execute against an aggressive product pipeline
focused on social, mobile, and virtual currency."
Key highlights of the combined business include:
1. Consolidated TTM Revenues and EBITDA of $33.6 million and
$5.9 million, respectively, as of the twelve months ended
March 31, 2011;
2. 4 billion monthly advertising impressions with 1 billion on
mobile and 3 billion on the web as of June, 2011;
3. Total registered web users of 70.9 million, 2.2 million
mobile installs (1.4 million on Android and 800 thousand on
iPhone), 11.5 million mobile game installs, 2.1 million
social game installs and monthly page views of 2.4 billion
in June, 2011;
4. Dramatic mobile growth from 2% of daily myYearbook users
logging in on a mobile device in January, 2010 to 40% of
daily users logging in on a mobile device in June, 2011;
5. Successful mobile platform to be leveraged across Latin
America, the United States, and other geographies;
6. Experienced social media team of 200+ people with 100+
engineers/product and 23 in Sales group;
7. Quepasa Games' social game IP creates vertically integrated,
high-margin social gaming revenue stream for myYearbook;
8. Vibrant virtual currency which accounts for one-quarter of
myYearbook revenue;
9. Highly complementary mix of cross-platform advertising
products, including Quepasa Social Contests and myYearbook
Social Theater
Following the completion of the merger, which is expected in the
fourth quarter of 2011, subject to certain closing considerations
described in the Merger Agreement, Geoff Cook will serve as Chief
Operating Officer of Quepasa Corporation and President of its
Consumer Internet Division while joining the company's Board of
Directors. Current myYearbook Board members, Rick Lewis, a
Partner at myYearbook investor U.S. Venture Partners, and Terry
Herndon, angel investor, will also join the Quepasa Board.
Together with Geoff Cook, the myYearbook designees to the Quepasa
Board represent the three largest shareholders in myYearbook.
Quepasa held a conference call to discuss the merger. A full-text
copy of the investor slide deck used in connection with its
conference call is available for free at http://is.gd/l1GEyE
A full-text copy of the Form 8-K is available for free at:
http://is.gd/wPfyJK
A full-text copy of the Agreement and Plan of Merger is available
for free at http://is.gd/LKS6kY
About Quepasa Corporation
West Palm Beach, Fla.-based Quepasa Corporation (OTC BB: QPSA)
through its Web site -- http://www.Quepasa.com/-- operates as an
online social community for young Hispanics.
Quepasa reported a consolidated net loss of $6.65 million on
$6.05 million of revenue for the fiscal year ended Dec. 31, 2010,
compared with a net loss of $10.58 million on $536,000 of revenue
during the prior year.
The Company's balance sheet at March 31, 2011, showed $21.01
million in total assets, $7.73 million in total liabilities and
$13.28 million in total stockholders' equity.
Salberg & Company, P.A., in Boca Raton, Florida, independent
report following the 2010 results did not contain a going concern
qualification for Quepasa Corp.
As reported in the Troubled Company Reporter on March 9, 2010,
Salberg & Company, P.A. expressed substantial doubt about the
Company's ability to continue as a going concern following the
2009 results. The independent auditors noted of the Company's
net loss and net cash used in operating activities in 2009 of
$10.58 million and $3.88 million, respectively, and a
stockholders' deficit and an accumulated deficit of $3.90 million
and $159.33 million, respectively, at Dec. 31, 2009.
QUEPASA CORP: Mexicans & Americans Discloses 18.3% Equity Stake
---------------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Mexicans & Americans Trading Together, Inc.,
and Altos Hornos de Mexico, S.A.B. de C.V., disclosed that they
beneficially own 3,333,333 shares of common stock of Quepasa
Corporation. The Shares represent 18.3% of 18,182,437 total
shares of Common Stock, calculated as the sum of (a) the
16,182,437 shares of Common Stock outstanding as represented by
the Company in its most recent report on Form 10-Q filed on
May 11, 2011, and (b) the 2,000,000 shares of Common Stock
issuable upon exercise of the Warrants.
As previously reported by the TCR on Dec. 30, 2010, Mexicans &
Americans disclosed 19.4% equity stake of the Company.
A full-text copy of the regulatory filing is available at no
charge at http://is.gd/RsYUOF
About Quepasa Corporation
West Palm Beach, Fla.-based Quepasa Corporation (OTC BB: QPSA)
through its Web site -- http://www.Quepasa.com/-- operates as an
online social community for young Hispanics.
Quepasa reported a consolidated net loss of $6.65 million on
$6.05 million of revenue for the fiscal year ended Dec. 31, 2010,
compared with a net loss of $10.58 million on $536,000 of revenue
during the prior year.
The Company's balance sheet at March 31, 2011, showed $21.01
million in total assets, $7.73 million in total liabilities and
$13.28 million in total stockholders' equity.
Salberg & Company, P.A., in Boca Raton, Florida, independent
report following the 2010 results did not contain a going concern
qualification for Quepasa Corp.
As reported in the Troubled Company Reporter on March 9, 2010,
Salberg & Company, P.A. expressed substantial doubt about the
Company's ability to continue as a going concern following the
2009 results. The independent auditors noted of the Company's
net loss and net cash used in operating activities in 2009 of
$10.58 million and $3.88 million, respectively, and a
stockholders' deficit and an accumulated deficit of $3.90 million
and $159.33 million, respectively, at Dec. 31, 2009.
RCLC INC: Consulting Actuaries OK's to Prepare Final Form 5500
--------------------------------------------------------------
The Hon. Michael B. Kaplan of the U.S. Bankruptcy Court for the
District of New Jersey authorized RCLC Inc. fka Ronson
Corporation, et al., to employ Consulting Actuaries Incorporated
to prepare a final Form 5500 for the Pension Plan pursuant to the
terms of an Engagement Agreement dated May 6, 2011.
A Form 5500 is required under Titles I and IV of ERISA and the
Internal Revenue Code to assure that employee benefit plans are
operated and managed in accordance with certain prescribed
standards and that participants and beneficiaries, as well as
regulators, are provided or have access to sufficient information
to protect the rights and benefits of participants and
beneficiaries under employee benefit plans. Because the Debtors
continued to distribute assets of the Pension Plan through October
2010, the Debtors have a legal obligation to file a final Form
5500 for the Pension Plan for the plan year beginning July 1,
2010.
The Debtors agreed to pay CAI a flat fee of $5,000. The
compensation negotiated with CAI was the result of arm's-length
negotiations.
To the best of the Debtors' knowledge, CAI is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.
About RCLC Inc.
RCLC, Inc., formerly known as Ronson Corporation, in Woodbridge,
New Jersey, historically, has been engaged principally in these
businesses -- Consumer Products; and Aviation-Fixed Wing and
Helicopter Services.
Trenton, New Jersey-based Ronson Aviation, Inc., now known as RA
Liquidating Corp., filed for Chapter 11 protection on Aug. 17,
2010 (Bankr. D. N.J. Case No. 10-35315). The Debtor estimated its
assets at $10 million to $50 million and its debts at $1 million
to $10 million. Affiliates RCLC, Inc. (Bankr. D. N.J. Case No.
10-35313), and RCPC Liquidating Corporation (Bankr. D. N.J. Case
No. 10-35318) filed separate Chapter 11 petitions on Aug. 17,
2010, each estimating their assets at $1 million to $10 million
and debts at $1 million to $10 million. The cases, along with
RCLC, Inc.'s, are jointly administered, with RCLC, Inc., as the
lead case.
Michael D. Sirota, Esq., and David M. Bass, Esq., and Felice R.
Yudkin, Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., in
Hackensack, N.J., represent the Debtors as counsel. Wilson Elser
Moskowitz Edelman & Dicker LLP serves as special environmental
counsel.
On Aug. 26, 2010, the Office of the U.S. Trustee appointed an
Official Committee of Unsecured Creditors. Attorneys at
Lowenstein Sandler, PC, represent the Creditors' Committee as
counsel.
The Company's foreign subsidiary, RCC, Inc., formerly known as
Ronson Corporation of Canada Ltd., is not included in the filing.
Upon the closing of the sale of the Company's Aviation Division on
Oct. 15, 2010, the Company ceased to have operations, other
than to effectuate its wind-down and approve its liquidation plan
by the Bankruptcy Court.
RCLC INC: Plan Confirmation Hearing Adjourned to Aug. 11
--------------------------------------------------------
The Hon. Michael B. Kaplan of the U.S. Bankruptcy Court for the
District of New Jersey has adjourned from July 14, 2011, to
Aug. 18, at 10:00 a.m., the hearing to consider confirmation of
RCLC Inc. fka Ronson Corporation, et al.'s First Amended Joint
Plan of Liquidation.
As reported in the Troubled Company Reporter on June 8, 2011, the
Court approved on March 24, the disclosure statement explaining
RCLC's First Amended Joint Plan of Liquidation as containing
adequate information pursuant to the Bankruptcy Code, a copy of
which is available for free at http://is.gd/aFNUp9
The Joint Plan provides that (i) the Priority Claims, the
Prepetition Credit Facility Claims, the Getzler Henrich Claim, and
the Other Secured Claims, as those terms are defined under the
Plan, have either been satisfied in full or will be satisfied in
full following the confirmation of the Plan; (ii) the General
Unsecured Claims will not be fully satisfied subject to the
requisite approval of the holders of those Claims; and (iii)
equity holders of the Debtors will receive no distribution under
the Plan, their interests will be canceled upon confirmation of
the Plan.
About RCLC Inc.
RCLC, Inc., formerly known as Ronson Corporation, in Woodbridge,
New Jersey, historically, has been engaged principally in these
businesses -- Consumer Products; and Aviation-Fixed Wing and
Helicopter Services.
Trenton, New Jersey-based Ronson Aviation, Inc., now known as RA
Liquidating Corp., filed for Chapter 11 protection on Aug. 17,
2010 (Bankr. D. N.J. Case No. 10-35315). The Debtor estimated its
assets at $10 million to $50 million and its debts at $1 million
to $10 million. Affiliates RCLC, Inc. (Bankr. D. N.J. Case No.
10-35313), and RCPC Liquidating Corporation (Bankr. D. N.J. Case
No. 10-35318) filed separate Chapter 11 petitions on Aug. 17,
2010, each estimating their assets at $1 million to $10 million
and debts at $1 million to $10 million. The cases, along with
RCLC, Inc.'s, are jointly administered, with RCLC, Inc., as the
lead case.
Michael D. Sirota, Esq., and David M. Bass, Esq., and Felice R.
Yudkin, Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., in
Hackensack, N.J., represent the Debtors as counsel. Wilson Elser
Moskowitz Edelman & Dicker LLP serves as special environmental
counsel.
Attorneys at Lowenstein Sandler, PC, represent the Creditors'
Committee as counsel.
The Company's foreign subsidiary, RCC, Inc., formerly known as
Ronson Corporation of Canada Ltd., is not included in the filing.
Upon the closing of the sale of the Company's Aviation Division on
Oct. 15, 2010, the Company ceased to have operations, other
than to effectuate its wind-down and approve its liquidation plan
by the Bankruptcy Court.
REAL MEX: Moody's Downgrades Corporate Family Rating to 'Ca'
------------------------------------------------------------
Moody's Investors Service downgraded Real Mex Restaurants, Inc.'s
Probability of Default and Corporate Family ratings to Ca from
Caa3. The company's senior secured notes due 2013 were lowered to
Caa2 from Caa1. The Speculative Grade Liquidity (SGL) rating was
affirmed at SGL-4. The ratings outlook was changed to stable from
negative.
Ratings downgraded:
Corporate Family Rating to Ca from Caa3
Probability of Default Rating to Ca from Caa3
$130 million 2nd lien senior secured notes due 2013 to Caa2 (LGD
2, 27%) from Caa1 (LGD 2, 27%)
Ratings affirmed:
Speculative Grade Liquidity rating at SGL - 4
RATINGS RATIONALE
The downgrade reflects Moody's view that Real Mex will likely
default on its debt obligations in the very near-term. The company
has informed us that it did not make its interest payment of
approximately $9.1 million due July 1, 2011 on the $130 million
2nd lien senior secured notes. While the bond indenture governing
the senior secured notes allows a 30-day grace period after the
interest payment due date, Moody's views the default probability
as high given the company's very weak liquidity. The Ca Corporate
Family Rating also incorporates the high probability of debt
impairment within the capital structure given the company's very
high leverage relative to its cash flow generation and asset base.
The Probability of Default rating could be revised to D if the
company files for bankruptcy or defaults on all of its debt
obligations. The PDR could be appended with the symbol "/LD" if
the company defaults on a limited set of its debt obligations.
Moody's does not anticipate upward rating momentum in the near
term given the operating environment and the high likelihood the
company will file for bankruptcy or undertake a distressed debt
exchange. A balance sheet restructuring that materially lowers
debt levels and improves liquidity could lead to an upgrade. The
ratings could be downgraded if the operating environment worsens
and Moody's estimate of debt impairment at default materially
increases.
Moody's last rating action on Real Mex occurred on May 9, 2011
when its Corporate Family and Probability of Default ratings were
downgraded to Caa3 from Caa2 and the SGL rating was lowered to
SGL-4.
The principal methodology used in rating Real Mex Restaurants,
Inc. was the Global Restaurant Industry published in June 2011.
Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.
Real Mex Restaurants, Inc., headquartered in Cypress, California,
is a leading Mexican-themed restaurant chain operator that owns,
operates and franchises casual dining restaurants primarily under
the El Torito, Chevys Fresh Mex and Acapulco Mexican Restaurant
concepts. Total revenues for twelve months ended March 27, 2011
were approximately $474 million.
REAL MEX: S&P Cuts Corp. Credit Rating to 'D' on Missed Payment
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Cypress, Calif.-based Real Mex Restaurants Inc. to 'D'
from 'CCC'. "We also lowered our issue-level rating on the
company's $130 million secured notes due 2013 to 'D' from 'CCC'.
The '4' recovery rating on the notes remains unchanged and
indicates our expectation for average (30% to 50%) recovery of
principal in the event of a payment default," S&P said.
The downgrade reflects Real Mex's missed interest payment due July
1, 2011 on its $130 million secured notes. "Although it has a 30-
day grace period to make the payment, we believe this is unlikely
given our assessment of weak liquidity, based on our criteria. The
company disclosed that it is in negotiations with lenders to amend
certain financial covenants. It also has meaningful debt
maturities as its revolving credit facility matures in July
2012 and its secured notes in 2013. Given these financial
characteristics, we believe the company will likely seek to
restructure its balance sheet and, in our opinion, could file for
protection under Chapter 11," S&P added.
REYNOLDS GROUP: S&P Assigns 'BB-' Issue Debt Rating to Sr. Notes
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned an issue debt rating
of 'BB-' (one notch above the corporate credit rating) and a
recovery rating of '2' to the $1.5 billion of proposed senior
secured notes due 2019 that entities of the Reynolds Group will
issue into escrow. Upon closing of the Graham acquisition, these
notes will become the joint obligation of Reynolds Group Issuer
Inc., Reynolds Group Issuer LLC, and Reynolds Group Issuer
(Luxembourg) S.A. The recovery rating indicates the expectation
for substantial (70% to 90%) recovery in the event of a payment
default.
In addition, Standard & Poor's assigned an issue rating of 'B-'
(two notches below the corporate credit rating) and a recovery
rating of '6' to the $500 million of proposed senior unsecured
notes due 2019 that will become joint obligations of the same
issuers. The '6' recovery rating indicates the expectation for
negligible (0% to 10%) recovery in the event of a payment default.
Reynolds will use proceeds from the two proposed note offerings,
together with proceeds from a proposed $2 billion term loan
(previously rated) as well as some cash on hand, to finance the
Graham acquisition.
All existing ratings on Reynolds, including the 'B+' corporate
credit rating, remain unchanged. The rating outlook on Reynolds is
negative. "The ratings on Reynolds reflect its strong business
risk profile as a premier provider of food and beverage packaging
and a highly leveraged financial risk profile," said Standard &
Poor's credit analyst Cynthia Werneth.
Even before the acquisition of Graham, Reynolds is one of the
world's leading and most diversified consumer and foodservice
packaging providers. The acquisition of Graham adds a leading
maker of innovative rigid plastic packaging with high and
relatively stable operating profitability.
However, Standard & Poor's is revising its liquidity assessment on
Reynolds to "less than adequate" from "adequate", primarily
because of the proposed increase in term loan amortization.
All ratings on Graham entities (including the 'B' corporate credit
rating) remain on CreditWatch with positive implications. "We will
raise all the Graham ratings by one notch if the transaction
closes as currently structured and Graham's senior unsecured and
subordinated notes remain in place," Ms. Werneth said.
SEAVIEW PLACE: Has Until Today to File Chapter 11 Plan
------------------------------------------------------
The Hon. K. Rodney May of the U.S. Bankruptcy Court for the Middle
District of Florida extended Seaview Place Developers, Inc.'s
exclusive period to file a chapter 11 plan and an explanatory
disclosure statement by July 25, 2011.
Clearwater Beach, Florida-based Seaview Place Developers, Inc.,
filed for Chapter 11 bankruptcy protection (Bankr. M.D. Fla. Case
No. 11-05126) on March 22, 2011. According to its schedules, the
Debtor disclosed $24,769,500 in total assets and $15,147,744 in
total debts as of the Petition Date.
SENSIVIDA MEDICAL: Posts $374,600 Net Loss in May 31 Quarter
------------------------------------------------------------
Sensivida Medical Technologies, Inc., reported a net loss of
$374,592 for the three months ended May 31, 2011, compared with a
net loss of $342,264 for the three months ended May 31, 2010. The
Company had no revenues during the three months ending May 31,
2011, and May 31, 2010.
The Company's balance sheet at May 31, 2011, showed $2.42 million
in total assets, $3.87 million in total liabilities, all current,
and a stockholders' deficit of $1.45 million.
As reported in the TCR on June 20, 2011, Morison Cogen LLP, in
Bala Cynwyd, Pennsylvania, expressed substantial doubt about
Sensivida Medical Technologies' ability to continue as a
going concern, following the Company's Feb. 28, 2011 results. The
independent auditors noted that the Company has no revenues,
incurred significant losses from operations, has negative working
capital and an accumulated deficit.
A copy of the Form 10-Q is available at http://is.gd/7wwwZx
West Henrietta, New York-based Sensivida Medical Technologies,
Inc., had operated in one business segment encompassing in the
design and development of medical diagnostic instruments that
detect cancer in vivo in humans by using light to excite the
molecules contained in tissue and measuring the differences in the
resulting natural fluorescence between cancerous and normal
tissue. Effective March 3, 2009, with the merger of SensiVida
Medical Systems, Inc., into the Company's wholly-owned subsidiary
BioScopix, Inc., the Company's technology now focuses on the
automation of analysis and data acquisition for allergy testing,
glucose monitoring, blood coagulation testing, new tuberculosis
testing, and cholesterol monitoring.
SENSIVIDA MEDICAL: Incurs $374,592 Net Loss in May 31 Quarter
-------------------------------------------------------------
Sensivida Medical Technologies, Inc., filed with the U.S.
Securities and Exchange Commission its Quarterly Report on Form
10-Q reporting a net loss of $374,592 on $0 of net sales for the
three months ended May 31, 2011, compared with a net loss of
$342,264 on $0 of net sales for the same period during the prior
year.
The Company's balance sheet at May 31, 2011, showed $2.41 million
in total assets, $3.86 million in total liabilities, all current,
and a $1.45 million total stockholders' deficit.
As reported by the TCR on July 20, 2011, Morison Cogen LLP, in
Bala Cynwyd, Pennsylvania, expressed substantial doubt about the
Company's ability to continue as a going concern, following the
Feb. 28, 2011, results. The independent auditors noted that the
Company has no revenues, incurred significant losses from
operations, has negative working capital and an accumulated
deficit.
A full-text copy of the Form 10-Q is available for free at:
http://is.gd/7wwwZx
About SensiVida Medical
Based in West Henrietta, New York, SensiVida Medical Technologies,
Inc. (formerly Mediscience Technology Corp.) focuses on the
automation of analysis and data acquisition for allergy testing,
glucose monitoring, blood coagulation testing, new tuberculosis
testing, and cholesterol monitoring.
The Company reported a net loss of $2.22 million on $0 of sales
for the year ended Feb. 28, 2011, compared with a net loss of
$1.56 million on $0 of sales during the prior year.
SIRIUS XM: David Frear to Continue to Serve as EVP and CFO
----------------------------------------------------------
Sirius XM Radio Inc., on July 21, 2011, entered into a new
employment agreement with David J. Frear to continue to serve as
the Company's Executive Vice President and Chief Financial Officer
through July 20, 2015. The Employment Agreement provides for an
annual base salary of $850,000. If Mr. Frear's employment is
terminated without cause or he terminates his employment for good
reason, the Company is obligated to pay him a lump sum payment
equal to his then annual salary and the cash value of the bonus
last paid or payable to him in respect of the preceding fiscal
year and to continue his health and life insurance benefits for
one year. The Company's obligations to pay the foregoing amounts
are subject to Mr. Frear's execution of a valid release of claims
against the Company and his compliance with certain restrictive
covenants. The Company has also agreed to indemnify Mr. Frear for
any excise taxes that may be imposed on him under Section 280G of
the Internal Revenue Code.
In connection with the execution of the Employment Agreement, the
Company granted Mr. Frear an option to purchase 16,000,000 shares
of the Company's common stock at an exercise price of $2.18 per
share. The Option will generally vest in four equal installments
on each of July 21, 2012, July 21, 2013, July 21, 2014 and July
21, 2015, subject to earlier acceleration or termination under
certain circumstances.
A full-text copy of the Employment Agreement is available for free
at http://is.gd/DVnrpB
About Sirius XM Radio
Based in New York, Sirius XM Radio Inc. has two principal wholly
owned subsidiaries, XM Satellite Radio Holdings Inc. and Satellite
CD Radio Inc. XM Satellite Radio Holdings Inc. owns XM Satellite
Radio Inc., the operating company for the XM satellite radio
service. Satellite CD Radio Inc. owns the Federal Communications
Commission license associated with the SIRIUS satellite radio
service. XM Satellite Radio Inc. owns XM Radio Inc., the holder
of the FCC license associated with the XM satellite radio service.
In July 2008, the Company's wholly owned subsidiary, Vernon Merger
Corporation, merged with and into XM Satellite Radio Holdings Inc.
and, as a result, XM Satellite Radio Holdings Inc. became Sirius'
wholly owned subsidiary.
The Company's balance sheet at March 31, 2011, showed $7.22
billion in total assets, $6.93 billion in total liabilities and
$298.62 million total stockholders' equity.
* * *
Sirius carries (i) a 'BB-' corporate credit rating from Standard &
Poor's and (ii) 'B3' corporate family rating and 'B2' probability
of default rating from Moody's.
In October 2010, Moody's said the upgrade of Sirius XM's CFR to
'B3' from 'Caa1' reflects Moody's view that EBITDA (incorporating
Moody's standard adjustments) less capital spending to interest
expense will grow and comfortably exceed 1x in 2011, reflecting
higher than anticipated subscribers and revenue and reduced debt
service and programming costs. As announced on October 1, 2010,
the company expects to add more than 1.3 million subscribers in
FY2010, bringing the year end total to 20.1 million and exceeding
prior expectations. Despite high churn in the subscriber base,
vulnerability to cyclical consumer spending, and increasing
wireless competition, Moody's believe subscriptions will grow
through the end of 2011 as the economy and automotive sales
recover. Heightened capital spending related to the ongoing
construction and launch of two satellites will likely limit free
cash flow generation in 2011. The rating also reflects the
company's sizable debt burden as well as the need to invest
significantly in programming, marketing, launching new services,
and maintaining a satellite fleet to attract subscribers in
addition to delivering content.
As reported by the Troubled Company reporter on Dec. 14, 2010,
Standard & Poor's Ratings Services raised its corporate credit
rating on Sirius XM Radio and its subsidiaries, XM Satellite Radio
Holdings Inc. and XM Satellite Radio Inc. (which S&P analyze on a
consolidated basis), to 'BB-' from 'B+'. The rating outlook is
stable. "The action reflects the company's improving operating
performance, declining debt leverage, and the prospects for
continued improvement in credit measures for full-year 2010 and
2011," explained Standard & Poor's credit analyst Hal Diamond.
SKINNY NUTRITIONAL: Receives $2.17MM from Common Stock Offering
---------------------------------------------------------------
As previously reported, in March 2011, Skinny Nutritional Corp.
commenced a private offering on a "best efforts" basis pursuant to
which it is offering an aggregate amount of $2,000,000 of shares
of common stock at $0.03 per share of common stock, plus an
oversubscription right of up to $500,000 of additional shares of
common stock.
On July 14, 2011, the Company terminated further selling efforts
in connection with the Offering and as of that date, the Company
had accepted subscriptions for 73,483,333 shares of Common Stock
for total gross proceeds of $2,204,500. The total net proceeds
derived from the Offering, after payment of offering expenses and
commissions, are approximately $2,170,000. The Company agreed to
pay commissions to registered broker-dealers that procured
investors in the Offering of 10% of the proceeds received from
such purchasers and to issue such persons such number of shares of
restricted common stock as equals 5% of the total number of shares
of Common Stock sold in the Offering to investors procured by
them.
Subsequently, on July 14, 2011, the Company entered into a stock
purchase agreement with an individual accredited investor in a
separate transaction pursuant to which such investor purchased
16,666,667 shares of Common Stock and warrants to purchase
16,666,667 shares of Common Stock for a total purchase price of
$500,000. The warrants are exercisable for a period of 36 months
at an exercise price of $0.05 per share. The purchase price for
the securities sold to this investor was $0.03 per share.
The Company intends to use the proceeds from these transactions
for working capital and general corporate purposes.
A full-text copy of the Form 8-K is available for free at:
http://is.gd/8WiBBq
About Skinny Nutritional
Bala Cynwyd, Pa.-based Skinny Nutritional Corp. (OTC BB: SKNY.OB)
-- http://www.SkinnyWater.com/-- has developed and is marketing a
line of enhanced waters, all branded with the name "Skinny Water"
that are marketed and distributed primarily to calorie and weight
conscious consumers.
The Company reported a net loss of $6.91 million on $6.92 million
of net revenue for the year ended Dec. 31, 2010, compared with a
net loss of $7.30 million on $4.14 million of net revenue during
the prior year.
As reported by the TCR on April 25, 2011, Marcum, LLP, in Bala
Cynwyd, Pennsylvania, expressed substantial doubt about the
Company's ability to continue as a going concern, following the
2010 financial results. The independent auditors noted that the
Company had a working capital deficiency of $3,517,280, an
accumulated deficit of $37,827,090, stockholders' deficit of
$2,658,043 and no cash on hand. The Company had net losses of
$6,914,269 and $7,305,831 for the years ended Dec. 31, 2010 and
2009, respectively. Additionally, the Company is currently in
arrears under its obligation for the purchase of trademarks.
Under the agreement, the seller of the trademarks may choose to
exercise their legal rights against the Company's assets, which
includes the trademarks.
The Company's balance sheet at March 31, 2011, showed $1.97
million in total assets, $4.26 million in total liabilities, all
current, and $2.29 million stockholders' deficit.
SOUTHSHORE COMMUNITY: Closed; American Momentum Assumes Deposits
----------------------------------------------------------------
American Momentum Bank of Tampa, Fla., acquired the banking
operations, including all the deposits, of Southshore Community
Bank of Apollo Beach, Fla., and LandMark Bank of Florida of
Sarasota, Fla. The two banks were closed on Friday, July 22,
2011, by the Florida Office of Financial Regulation, which
appointed the Federal Deposit Insurance Corporation as receiver.
To protect the depositors, the FDIC entered into a purchase and
assumption agreement with American Momentum Bank.
Southshore Community Bank had two branches, and LandMark Bank of
Florida had six branches. All eight branches of the two closed
banks will reopen during normal business hours as branches of
American Momentum Bank. Depositors of the two failed banks will
automatically become depositors of American Momentum Bank.
Deposits will continue to be insured by the FDIC, so there is no
need for customers to change their banking relationship in order
to retain their deposit insurance coverage up to applicable
limits. Customers of the two failed banks should continue to use
their existing branches until they receive notice from American
Momentum Bank that it has completed systems changes to allow other
branches of American Momentum Bank to process their accounts as
well.
As of March 31, 2011, Southshore Community Bank had around $46.3
million in total assets and $45.3 million in total deposits; and
LandMark Bank of Florida had total assets of $275.0 million and
total deposits of $246.7 million. In addition to assuming all of
the deposits of the two Florida banks, American Momentum Bank
agreed to purchase essentially all of their assets.
Customers with questions about the transaction should call the
FDIC toll-free: for Southshore Community Bank customers, 1-800-
894-2013, and for LandMark Bank of Florida customers, 1-800-889-
4976. Interested parties also can visit the FDIC's Web sites: for
Southshore Community Bank,
http://www.fdic.gov/bank/individual/failed/southshore.html
and for LandMark Bank of Florida,
http://www.fdic.gov/bank/individual/failed/LandMark.html
The FDIC estimates that the cost to the Deposit Insurance Fund for
Southshore Community Bank will be $8.3 million and for LandMark
Bank of Florida, $34.4 million. Compared to other alternatives,
American Momentum Bank's acquisition of the two institutions was
the least costly resolution for the FDIC's DIF.
The closings are the 56th and 57th FDIC-insured institutions to
fail in the nation so far this year and the eighth and ninth in
Florida. The last FDIC-insured institution closed in the state
was First Peoples Bank, Port Saint Lucie, on July 15, 2011.
SUN COUNTRY: Finds Buyer After Scandal, Bankruptcy
--------------------------------------------------
Dow Jones' DBR Small Cap reports that Sun Country Airlines, a
small St. Paul, Minn., carrier once majority owned by convicted
Minnesota Ponzi schemer Tom Petters, has found a new owner after
emerging from bankruptcy-court reorganization earlier this year,
the company said.
About Sun Country
St. Paul, Minnesota-based Sun Country Airlines (MN Airlines, LLC,
d.b.a. Sun Country Airlines) -- http://www.SunCountry.com/--
flies to popular destinations in the U.S., Mexico and the
Caribbean.
Sun Country Airlines and its debtor-affiliates Petters Aviation
LLC and MN Airline Holdings Inc. filed separate petitions for
Chapter 11 relief (Bankr. D. Minn. Lead Case No. 08-45136) on
Oct. 6, 2008. Brian F. Leonard, Esq., Matthew R. Burton, Esq., at
Leonard O'Brien et al., represent the Debtors as counsel. In its
petition, Petters Aviation LLC estimated $50 million and
$100 million in total assets and debts.
SUNBRIDGE CAPITAL: Avoidance Suit v. Gulf City Stays in Bankr. Ct.
------------------------------------------------------------------
The Bankruptcy Court is a proper venue for the lawsuit,
Christopher J. Redmond, Trustee, v. Gulf City Body & Trailer
Works, Inc., Adv. Proc. No. 11-06113 (Bankr. D. Kan.), Bankruptcy
Judge Dale L. Somers has ruled. Mr. Redmond, as Chapter 7 trustee
for Sunbridge Capital, Inc., seeks to recover a $7,794.38
prepetition transfer, pursuant to 11 U.S.C. Sections 547, 548, and
550. Gulf City seeks dismissal of the lawsuit for improper venue
under 28 U.S.C. Sec. 1409(b). Judge Somers said the claims
alleged arose under title 11 and therefore are not within Sec.
1409(b), which limits venue to the district where the defendant
resides only for small-dollar claim "arising in" and "related to"
the bankruptcy case. The Defendant's Motion to Dismiss is denied.
A copy of Judge Somer's July 20, 2011 Memorandum Opinion is
available at http://tinyurl.com/4yg2kewfrom Leagle.com.
Gulf City Body & Trailer Works is represented by:
Gilbert L. Fontenot, Esq.
MAPLES & FONTENOT, LLP
Wachovia Building, 2nd Floor
61 St. Joseph Street, Suite 200
P.O. Box 1281, Mobile, AL 36633
Mobile, AL 36602
Tel: (251) 432-2629
Fax: (251) 432-3629
E-mail: guslf100@aol.com
-- and --
Cynthia F. Grimes, Esq.
GRIMES & REBEIN, LLC
15301 West 87th Street
Lenexa, KS 66219
Tel: 913-888-4800
Fax: 913-888-0570
Sunbridge Capital Inc., financed commercial trucks, trailers and
construction equipment throughout the United States. According to
a 2007 report by the Kansas City Business Journal, Jack Fingersh,
chairman of Hillcrest Bancshares Inc., bought a majority stake in
SunBridge. The purchase price was not disclosed.
As reported by the Troubled Company Reporter, Hillcrest Bank of
Overland Park, Kansas, was closed Oct. 22, 2010, by the Kansas
Office of the State Bank Commissioner, which appointed the Federal
Deposit Insurance Corporation as receiver. The FDIC then entered
into a purchase and assumption agreement with a newly chartered
bank subsidiary of NBH Holdings Corp. of Boston, Mass., to assume
all of the deposits of Hillcrest Bank.
An involuntary Chapter 7 bankruptcy petition (Bankr. D. Kan. Case
No. 09-20747) was filed against Sunbridge, aka Commercial Leasing
Corporation, fka Commercial Leasing Corporation of Kansas, on
March 20, 2009. Christopher J. Redmond has been appointed as
Chapter 7 Trustee. He is represented by:
Michael D. Fielding, Esq.
HUSCH BLACKWELL, LLP
4801 Main Street, Suite 1000
Kansas City, MO 64112
Tel: 816-983-8353
Fax: 816-983-8080
E-mail: michael.fielding@huschblackwell.com
TAYLOR BEAN: $1.6 Billion Deal Overcomes Freddie Mac Protest
------------------------------------------------------------
Christopher Norton at Bankruptcy Law360 reports that a Florida
federal judge on Thursday overruled Freddie Mac's objection to a
$1.6 billion settlement allowing Taylor Bean & Whitaker Mortgage
Corp. to pay a bankruptcy claim related to a massive criminal
securities fraud that brought down the lender.
About Taylor Bean
Taylor, Bean & Whitaker Mortgage Corp. grew from a small Ocala-
based mortgage broker to become one of the largest mortgage
bankers in the United States. In 2009, Taylor Bean was the
country's third largest direct-endorsement lender of FHA-insured
loans of the largest wholesale mortgage lenders and issuer of
mortgage backed securities. It also managed a combined mortgage
servicing portfolio of approximately $80 billion. The company
employed more that 2,000 people in offices located throughout the
United States.
Taylor Bean sought Chapter 11 protection (Bankr. M.D. Fla. Case
No. 09-07047) on Aug. 24, 2009. Taylor Bean filed the Chapter 11
petition three weeks after federal investigators searched its
offices. The day following the search, the Federal Housing
Administration, Ginnie Mae and Freddie Mac prohibited the company
from issuing new mortgages and terminated servicing rights.
Taylor Bean estimated more than $1 billion in both assets and
liabilities in its bankruptcy petition.
Jeffrey W. Kelly, Esq., and J. David Dantzler, Jr., Esq., at
Troutman Sanders LLP, in Atlanta, Ga., and Russel M. Blain, Esq.,
and Edward J. Peterson, III, Esq., at Stichter, Riedel, Blain &
Prosser, PA, in Tampa, Fla., represent the Debtors. Paul Steven
Singerman, Esq., and Arthur J. Spector, Esq., at Berger Singerman
PA, in Miami, Fla., represent the Committee. BMC Group, Inc.,
serves as the claims and noticing agent.
TELKONET INC: To Offer 10MM Shares Under Stock Option Plan
----------------------------------------------------------
Telkonet, Inc., filed with the U.S. Securities and Exchange
Commission a Form S-8 registration statement registering
10.0 million shares of common stock to be offered under the
Telkonet, Inc., 2010 Stock Option and Incentive Plan. A full-text
copy of the registration statement is available for free at:
http://is.gd/mKbrXt
About Telkonet
Milwaukee, Wisconsin-based Telkonet, Inc. is a clean technology
company that develops and manufactures proprietary energy
efficiency and smart grid networking technology.
The Company reported a net loss attributable to common
stockholders of $1.77 million on $11.26 million of total revenue
for the year ended Dec. 31, 2010, compared with net income
attributable to common stockholders of $1.06 million on $10.52
million of total revenue during the prior year.
The Company's balance sheet at March 31, 2011, showed $15.14
million in total assets, $4.84 million in total liabilities,
$929,588 in redeemable preferred stock, Series, A, $719,157 in
redeemable preferred stock, Series B, and $8.65 million in total
stockholders' equity.
RBSM LLP, in New York, expressed substantial doubt about the
Company's ability to continue as a going concern, following the
2010 financial results. RBSM noted that the Company has incurred
significant operating losses in current year and also in the past.
TEMPEL STEEL: S&P Assigns Prelim. 'B' Corporate Credit Rating
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned a preliminary 'B'
corporate credit rating to Illinois-based Tempel Steel Company.
"At the same time, we assigned a preliminary 'B' issue-level
rating to the company's proposed new $130 million senior secured
notes with a preliminary recovery rating of '4', indicating our
expectation of an average recovery (30%-50%) in a default
scenario. The outlook is stable. The company is currently in
litigation with its lending group under its existing credit
facility. The preliminary ratings assume that this litigation will
be resolved, and that there will be no meaningful related
contingencies upon completion of the proposed new debt issuance,"
S&P related.
Tempel Steel is one of the largest independent producers of
magnetic steel laminations used in the production of electric
motors and transformers. The company's products are used across a
variety of end markets: household and consumer, power supply and
infrastructure, passenger cars, oil, gas and mining, industrial
motors, and vehicles and locomotives. This, together with Tempel
Steel's global footprint, provides some diversity, but the
business is limited in scope to magnetic steel lamination.
Tempel Steel competes both with a highly fragmented base of
smaller independent producers and with larger, vertically
integrated motors and transformers manufacturers, many of which
are also its customers. "We view customer diversity as moderate,
with its top 10 customers accounting for no more than 30% of 2010
revenues. While Tempel Steel is capable of serving large
multinational manufacturers seeking to outsource their steel
lamination requirements and benefits from longstanding customer
relationships, it is exposed to changes in production levels and
outsourced volumes as many of its end markets are cyclical," S&P
said.
"We view the industry as capital intensive and price competitive,
and Tempel's operations exhibit a fair degree of operating
leverage," said Standard & Poor's credit analyst Peter Kelly.
While EBITDA margin was negative in 2009 (due to depressed demand
and higher priced steel in inventory), profitability, which had
historically been in the low teens, partially recovered in 2010.
"Based on our expectation of moderate growth in the company's
markets over the next two years, we expect the company's
profitability to be broadly consistent with historical average
levels," said Mr. Kelly.
Pro forma for the proposed transaction, Standard & Poor's expects
the company's financial leverage, as measured by the ratio of
total adjusted debt to EBITDA, will be about 4.0x and funds from
operations (FFO) to total adjusted debt to be about 10%. "While we
expect that the current demand trends will enable the company to
maintain these financial metrics, credit ratios could fluctuate
with the demand cycle; for the rating, we would expect these
credit measures to be around 5.0x and 10%, respectively. Capital
expenditures will likely average about 3% of sales but working
capital requirements may somewhat limit free cash flow
generation," S&P added.
The outlook is stable.
TEN X CAPITAL: Taps Foster and Smith as Bankruptcy Counsel
----------------------------------------------------------
Ten X Capital Partners III, LLC (Series B), asks the U.S.
Bankruptcy Court for the Northern District of Illinois for
permission to employ Foster and Smith as counsel.
Foster and Smith will represent the Debtor in the Chapter 11
proceedings.
Prepetition, Foster and Smith received $15,000 in connection with
the services rendered. A total of $3,209 of the retainer was
applied against the fees and expenses incurred leaving a balance
of $11,791.
To the best of the Debtor's knowledge, Foster and Smith is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
About Ten X Capital Partners
Ten X Capital Partners III, LLC (Series B) operates an industrial
real property located at 601 W. Polk Street, Chicago, Illinois, as
a telecom hotel and storage facility. Ten X Capital Partners III,
LLC (Series B) filed a voluntary Chapter 11 petition (Bankr. N.D.
Ill. Case No. 11-27294) on June 30, 2011. Judge John H. Squires
presides over the case. The Debtor is represented by Chester H.
Foster, Jr., Esq., at Foster & Smith. In its petition, the Debtor
estimated $10 million to $50 million in assets, and $1 million to
$10 million in debts. The petition was signed by John W. Branch,
manager of RM Advisors, LLC.
TEN X CAPITAL: Meeting of Creditors Scheduled for Aug. 4
--------------------------------------------------------
The U.S. Trustee for Region 10 will convene a meeting of creditors
in Ten X Capital Partners III, LLC (Series B)'s Chapter 11 case on
Aug. 4, 2011, at 1:30 p.m. The meeting will be held at 219 South
Dearborn, Office of the U.S. Trustee, 8th Floor, Room 802,
Chicago, Illinois.
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.
Ten X Capital Partners III, LLC (Series B) operates an industrial
real property located at 601 W. Polk Street, Chicago, Illinois, as
a telecom hotel and storage facility. Ten X Capital Partners III,
LLC (Series B) filed a voluntary Chapter 11 petition (Bankr. N.D.
Ill. Case No. 11-27294) on June 30, 2011. Judge John H. Squires
presides over the case. The Debtor is represented by Chester H.
Foster, Jr., Esq., at Foster & Smith. In its petition, the Debtor
estimated $10 million to $50 million in assets, and $1 million to
$10 million in debts. The petition was signed by John W. Branch,
manager of RM Advisors, LLC.
TEXAS WYOMING: Trustee Can Sue Ex-Shareholders, 5th Circ. Says
--------------------------------------------------------------
Dan Rivoli at Bankruptcy Law360 reports that the Fifth Circuit
said Thursday that Texas Wyoming Drilling Inc.'s trustee can sue
former shareholders for $4 million in dividends they received
during the company's insolvency, upholding a Texas bankruptcy
court decision against one of the driller's targets.
A three-judge panel upheld the bankruptcy court's ruling against
one of Texas Wyoming's 32 pre-Chapter 11 petition shareholders,
Laguna Madre Oil & Gas II LLC, which sought to have the case
tossed because the drilling company had no standing to sue,
according to Law360.
Drilling contractor and service company Texas Wyoming Drilling,
Inc. -- http://www.texaswyoming.com-- sought Chapter 11
protection (Bankr. N.D. Tex. Case No. 07-41650) on Apr. 16, 2007;
is represented by Jeffery D. Carruth, Esq., Mark A. Castillo,
Esq., and Stephanie Diane Curtis, Esq., at The Curtis Law Firm,
P.C., in Dallas, Tex.; and estimated its assets and debts at more
than $1 million to $100 million at the time of the filing.
The Bankruptcy Court confirmed Texas Wyoming's Chapter 11 plan on
Nov. 13, 2008, and that plan was declared effective before the end
of the year. The Reorganized Debtor commenced post-confirmation
litigation (Bankr. N.D. Tex. Adv. Pro. No. 09-04015) on Apr. 29,
2009, against recipients of dividends, asserting that dividend
payments were avoidable as fraudulent transfers. On July 14,
2009, following a material default under the chapter 11 plan, the
Court, sua ponte based on 11 U.S.C. Sec. 1112(b)(4)(N), converted
the Reorganized Debtor's chapter 11 case to a Chapter 7
proceeding, and the U.S. Trustee appointed John Dee Spicer to
serve as the Chapter 7 Trustee. The recipients moved for summary
judgment, arguing, inter alia, that debtor lacked standing to
pursue the avoidance claims. The Honorable Dennis Michael Lynn
disagrees, and gave Mr. Spicer the green light to pursue his
claims against the recipients.
THERMOENERGY CORP: Amends Bridge Loan Agreement with Empire
-----------------------------------------------------------
ThermoEnergy Corporation, on July 12, 2011, amended the Bridge
Loan and Warrant Amendment Agreement, dated as of June 17, 2011,
by and among us and Empire Capital Partners, LP; Empire Capital
Partners, Ltd; Empire Capital Partners Enhanced Master Fund, Ltd.;
Robert S. Trump; Focus Fund L.P.; Hughes Capital; Scott A. Fine;
and Peter J. Richards, in accordance with the terms of the
Agreement, to provide for the extension to the Company by Mr.
Trump and Empire of additional bridge loans in these amounts:
Principal Amount
Noteholder of Note
---------- ----------------
Robert S. Trump $855,422
Empire Capital Partners, LP $248,493
Empire Capital Partners, Ltd $248,493
Empire Capital Partners Enhanced Master Fund, Ltd $248,493
Pursuant to the Agreement, on July 12, 2011, the Company issued to
Mr. Trump and to each of the Empire entities the Company's
Promissory Note in the amount of his or its additional bridge
loan.
Pursuant to the Agreement, the Company agreed, subject to the
satisfaction of certain conditions, to amend certain of the Common
Stock Purchase Warrants held by or issuable to Mr. Trump, Empire
and the other parties to the Agreement (i) to provide that they
will be exercisable for the purchase of shares of the Company's
Series B Convertible Preferred Stock instead of Common Stock (with
the number of shares of Series B Stock determined by dividing by
ten the number of shares of Common Stock for which the Warrants
are currently exercisable) and (ii) to change the exercise prices
of the Warrants to $1.30 per share of Series B Stock (the
equivalent of $0.13 per Common-equivalent share). The Investors
agreed, subject to the satisfaction of certain conditions, to
exercise all of the Warrants. The principal amount of the July 12
Notes is equal to the aggregate exercise price of Warrants
issuable to Mr. Trump and Empire upon the conversion into shares
of Series B Stock of convertible debt held by them.
The July 12 Notes are identical in form to the other Promissory
Notes issued by us pursuant to the Agreement. They are payable on
demand at any time on or after Feb. 29, 2012. They do not bear
interest until the Maturity Date and will bear interest at the
rate of 10% per annum from and after the Maturity Date. The July
12 Notes may not be prepaid, in whole or in part, without the
prior written consent of the holders. Mr. Trump and Empire have
agreed to surrender the July 12 Notes in payment of the exercise
price for the New Warrants if and when the conditions to their
issuance, amendment and exercise have been satisfied. The July 12
Notes contain other conventional terms, including events of
default upon the occurrence, and during the continuation, of which
the July 12 Notes will bear interest at the rate of 10% per annum.
The Company intends to use the proceeds from the issuance of the
July 12 Notes for general working capital.
About ThermoEnergy Corporation
Little Rock, Ark.-based ThermoEnergy Corporation is a clean
technologies company engaged in the worldwide development of
advanced municipal and industrial wastewater treatment systems and
carbon reducing clean energy technologies.
The Company reported a net loss of $9.85 million on $2.87 million
of revenue for the year ended Dec. 31, 2010, compared with a net
loss of $12.98 million on $4.01 million of revenue during the
prior year.
The Company's balance sheet at March 31, 2011, showed
$3.97 million in total assets, $13.15 million in total liabilities
and a $9.18 million total stockholders' deficiency.
As reported by the TCR on April 7, 2011, Kemp & Company, a
Professional Association, in Little Rock, Arkansas, expressed
substantial doubt about the Company's ability to continue as a
going concern. The independent auditors noted that the Company
has incurred net losses since inception and will require
substantial capital to continue commercialization of the
Company's technologies and to fund the Companies liabilities.
TRIBUNE CO: Bank Debt Trades at 32% Off in Secondary Market
-----------------------------------------------------------
Participations in a syndicated loan under which Tribune Co. is a
borrower traded in the secondary market at 67.96 cents-on-the-
dollar during the week ended Friday, July 22, 2011, an increase of
0.52 percentage points from the previous week according to data
compiled by Loan Pricing Corp. and reported in The Wall Street
Journal. The Company pays 300 basis points above LIBOR to borrow
under the facility. The bank loan matures on May 7, 2014.
Moody's has withdrawn its rating on the loan. The loan is one of
the biggest gainers and losers among 208 widely quoted syndicated
loans with five or more bids in secondary trading for the week
ended Friday.
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 (Bankr. D. Del. Lead Case No. 08-13141) on Dec. 8,
2008. The Debtors proposed Sidley Austin LLP as their counsel;
Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel;
Lazard Ltd. and Alvarez & Marsal North America 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. Chadbourne & Parke LLP and
Landis Rath LLP serve as co-counsel to the Official Committee of
Unsecured Creditors. AlixPartners LLP is the Committee's
financial advisor. Landis Rath Moelis & Company serves as the
Committee's investment banker. Thomas G. Macauley, Esq., at
Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the
Committee in connection with the lawsuit filed against former
officers and shareholders for the 2007 LBO of Tribune.
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)
TRICO MARINE: Can Use Cash Collateral Until May 23
--------------------------------------------------
Judge Brendan L. Shannon of the U.S. Bankruptcy Court for the
District of Delaware authorized Trico Marine Services, Inc., and
its debtor affiliates to use cash collateral of the U.S. Bank
National Association, as trustee for the 8.125% Secured
Convertible Debentures due 2013, until May 23, 2011.
The Debtors are prohibited from using any proceeds, direct or
indirect, of transactions by Eastern Marine Services Limited.
Those proceeds will be segregated from other funds. The Debtors
are also prohibited from using amounts constituting any part of
the Secured Claim Reserve.
About Trico Marine
Headquartered in Texas, Trico Marine Services, Inc. --
http://www.tricomarine.com/-- provides subsea services, subsea
trenching and protection services, and towing and supply vessels.
Trico filed for Chapter 11 protection on August 25, 2010 (Bankr.
D. Del. Case No. 10-12653). John E. Mitchell, Esq., Angela B.
Degeyter, Esq., and Harry A. Perrin, Esq., at Vinson & Elkins LLP,
assist the Debtor in its restructuring effort. The Debtor
disclosed $30,562,681 in assets and $353,606,467 in liabilities as
of the Petition Date.
Affiliates Trico Marine Assets, Inc. (Bankr. D. Del. Case No. 10-
12648), Trico Marine Operators, Inc. (Case No. 10-12649), Trico
Marine International, Inc. (Case No. 10-12650), Trico Marine
Cayman, L.P. (Case No. 10-12651), and Trico Holdco, LLC (Case No.
10-12652) filed separate Chapter 11 petitions.
Cahill Gordon & Reindell LLP is the Debtors' special counsel.
Alix Partners Services, LLC, is the Debtors' chief restructuring
officer. Epiq Bankruptcy Solutions is the Debtors' claims and
notice agent. Postlethwaite & Netterville serves as the Debtors'
accountant and Ernst & Young LLP serves as tax advisors.
PricewaterhouseCoopers LLC serves as independent accountants and
tax advisors to the Debtors.
Trico's foreign subsidiaries were not included in the filing and
will not be subject to the requiremets of the U.S. Bankruptcy
Code.
TWIN CITY: Funds in Deferred Compensation Plan Not Part of Estate
-----------------------------------------------------------------
Bankruptcy Judge Russ Kendig held that the funds in the deferred
compensation plan established by Twin City Hospital subject to
Internal Revenue Code 457(b), are not property of the estate
pursuant to 11 U.S.C. Sec. 541(b)(7)(A)(i)(II) and, therefore, are
not subject to Well's Fargo Bank N.A.'s DIP lien. Judge Kendig
also held that the Debtor is judicially estopped from claiming
that the 457(b) Plan funds are part of the estate.
In his ruling, Judge Kendig pointed to a decision in the
bankruptcy case of Colonial BancGroup. Twin City, among others,
argues that the 457(b) Plan contributions were not "withheld by an
employer" as that phrase is used in section 541(b)(7). In support
of this argument, the debtor cites Schroeder v. New Century
Holdings. Inc. (In re New Century Holdings, Inc.), 387 B.R. 95,
114 (Bankr. D. Del. 2008) and other cases which distinguish
"deferred" compensation from "withheld" compensation and find that
"deferred" compensation is property of the estate. In New
Century, the court found that a "deferral" occurs where "the
employee agreed to receive the income at a later date and never
actually possessed it" and a withholding occurs where "the
employee possessed the income at some point. . . ."
By contrast, Judge Kendig said, the court in In re Colonial
BancGroup. Inc., 436 B.R. 695, 712 (Bankr. M.D.. Ala. 2010) was
critical of this view. The court found that "deferred" and
"withheld" could not be mutually exclusive concepts because
section 541(b)(7) excludes amounts "withheld" from "deferred"
compensation plans. If "withheld" and "deferred" were interpreted
to be mutually exclusive concepts, the statute would be a nullity,
which could hardly be what Congress intended. Instead, the
Colonial BankGroup court found that when beneficiaries are
presently entitled to income, but have made a voluntary election
to make plan contributions, the income has been withheld within
the meaning of the statute. This interpretation is more
consistent with the language of the statute as a whole and the
ordinary usage of the word" withheld" as applied to retirement
plans. In Twin City's case, Judge Kendig said, the plan
participants were entitled to the plan contributions, but signed
income reduction agreements to redirect a part of their salaries
to the 457(b) Plan. Accordingly, the court finds that the fund
were "withheld" as that term is used in 541(b). Any other
linguistic machinations would serve to frustrate the clear intent
of Congress.
A copy of Judge Kendig's July 21, 2011 memorandum of opinion is
available at http://tinyurl.com/3t8jfuhfrom Leagle.com.
About Twin City Hospital
Dennison, Ohio-based Twin City Hospital filed for Chapter 11
bankruptcy protection on Oct. 13, 2010 (Bankr. N.D. Ohio Case
No. 10-64360). Shawn M. Riley, Esq., at McDonald Hopkins LLC,
represents the Debtor in its restructuring effort. The Debtor
estimated its assets and debts at $10 million to $50 million.
Twin City Hospital has sold substantially all of its assets to
Trinity Hospital Twin City, an affiliate of the Franciscan
Services Corp. for $4.85 million. The case was converted from a
chapter 11 to a chapter 7 on June 28, 2011, following the sale.
Tony DeGirolamo was appointed as Chapter 7 trustee.
US FIDELIS: Committee Files Parkway Property Auction Results
------------------------------------------------------------
The Official Committee of Unsecured Creditors in the Chapter 11
case of US Fidelis, Inc., filed a report of the results in an
auction sale of certain personal property located at the Debtor's
headquarters at 100 Mall Parkway, Wentzville, Missouri, and two
pieces of real estate in surrounding areas.
A full-text copy of the Auction Results, dated May 11, 2011, is
available for free at http://ResearchArchives.com/t/s?7627
Wentzville, Missouri-based US Fidelis, Inc., was a marketer of
vehicle service contracts developed by independent and unrelated
companies. It stopped writing new business in December 2009.
The Company filed for Chapter 11 bankruptcy protection on March 1,
2010 (Bankr. E.D. Mo. Case No. 10-41902). Robert E. Eggmann,
Esq., at Lathrop & Gage, assists the Company in its restructuring
effort. According to the schedules, the Company had assets of
$74,386,836, and total debts of $25,770,655 as of the petition
date.
WARNER MUSIC: Completely Acquired by Access Industries
------------------------------------------------------
Warner Music Group Corp. announced the completion of its
acquisition by Airplanes Music, LLC, and Airplanes Merger Sub,
Inc., affiliates of Access Industries, Inc., for $8.25 per share
in cash.
The transaction was approved by the Company's stockholders at a
special meeting of the stockholders held on July 6, 2011. The
Company's common stock will be delisted from the New York Stock
Exchange.
Paul, Weiss, Rifkind, Wharton & Garrison LLP acted as legal
advisor to the Company. The independent directors of the
Company's Board of Directors were advised by an independent legal
advisor, Wachtell, Lipton, Rosen & Katz. Goldman, Sachs & Co. and
AGM Partners LLC acted as financial advisors to the Company.
Debevoise & Plimpton LLP acted as legal advisor to Access.
In connection with the consummation of the Merger, all of the
directors of the Company, other than Edgar Bronfman, Jr., resigned
from their positions effective time of the Merger.
As a result of the consummation of the Merger, the Second Amended
and Restated Certificate of Incorporation of the Company, as
amended, was amended and restated by the Certificate of Merger
filed with the Secretary of State of the State of Delaware on
July 20, 2011, and such Third Amended and Restated Certificate of
Incorporation is the Certificate of Incorporation of the surviving
corporation. The Amended and Restated Bylaws of the Company were
amended and restated as contemplated by the Merger Agreement.
About Warner Music Group
Based in New York, Warner Music Group Corp. (NYSE: WMG)
-- http://www.wmg.com/-- was formed by a private equity
consortium of investors on Nov. 21, 2003. The Company is the
direct parent of WMG Holdings Corp., which is the direct parent of
WMG Acquisition Corp. WMG Acquisition Corp. is one of the world's
major music-based content companies and the successor to
substantially all of the interests of the recorded music and music
publishing businesses of Time Warner Inc.
The Company classifies its business interests into two fundamental
operations: Recorded Music and Music Publishing. The Company's
Recorded Music business primarily consists of the discovery and
development of artists and the related marketing, distribution and
licensing of recorded music produced by such artists. The
Company's Music Publishing operations include Warner/Chappell, its
global Music Publishing company, headquartered in New York with
operations in over 50 countries through various subsidiaries,
affiliates and non-affiliated licensees.
Warner Music reported a net loss of $39 million on $682 million of
revenue for the three months ended March 31, 2011, compared with a
net loss of $28 million on $666 million of revenue for the same
period during the prior year. The Company also reported a net
loss of $57 million on $1.47 billion of revenue for the six months
ended March 31, 2011, compared with a net loss of $44 million on
$1.58 billion of revenue for the same period during the prior
year.
The Company's balance sheet at March 31, 2011, showed
$3.61 billion in total assets, $3.87 billion in total liabilities
and a $254 million in total deficit.
* * *
In May 2011, Warner Music Group Corp. and Access Industries, the
U.S.-based industrial group, announced the execution of a
definitive merger agreement under which Access Industries will
acquire WMG in an all-cash transaction valued at $3.3 billion.
The purchase includes WMG's entire recorded music and music
publishing businesses.
As reported by the TCR on July 18, 2011, Fitch Ratings has
affirmed and withdrawn the long-term Issuer Default Ratings and
issue ratings of Warner Music Group Corp., WMG Acquisition Corp.
and WMG Holdings Corp. Fitch has decided to discontinue the rating
due to insufficient information.
The ratings were previously on Rating Watch Negative, reflecting
the uncertainty of how the acquisition of WMG by Airplanes Music
LLC (an affiliate of Access Industries, Inc.) would be structured.
The Rating Watch Negative has not been resolved. Any incremental
or higher coupon debt that drove interest coverage below 1.5 times
(x) could have triggered at least a one notch downgrade.
WASHINGTON MUTUAL: Investors Wrap Up Arguments Against Ch. 11 Plan
------------------------------------------------------------------
Lance Duroni at Bankruptcy Law360 reports that Washington Mutual
Inc. shareholders on Thursday tried to tie the bank holding
company to insider trading allegations against four hedge funds
that helped forge its reorganization plan, capping off the
shareholders' evidence opposing the plan.
Law360 relates that with the evidentiary record now closed in
WaMu's plan confirmation hearing, the parties will file written
submissions by Aug. 3 to guide U.S. Bankruptcy Judge Mary F.
Walrath's decision, with closing arguments to come later in that
month.
About Washington Mutual
Based in Seattle, Washington, Washington Mutual Inc. --
http://www.wamu.com/-- is a holding company for Washington Mutual
Bank as well as numerous non-bank subsidiaries.
Washington Mutual Bank was taken over on Sept. 25, 2008, by U.S.
government regulators. The next day, WaMu and its affiliate, WMI
Investment Corp., filed separate petitions for Chapter 11 relief
(Bankr. D. Del. 08-12229 and 08-12228, respectively). WaMu owns
100% of the equity in WMI Investment. When WaMu filed for
protection from its creditors, it disclosed assets of
$32,896,605,516 and debts of $8,167,022,695. WMI Investment
estimated assets of $500 million to $1 billion with zero debts.
WaMu is represented by Brian Rosen, Esq., at Weil, Gotshal &
Manges LLP in New York City; Mark D. Collins, Esq., at Richards,
Layton & Finger P.A. in Wilmington, Del.; and Peter Calamari,
Esq., and David Elsberg, Esq., at Quinn Emanuel Urquhart Oliver &
Hedges, LLP. The Debtor tapped Valuation Research Corporation as
valuation service provider for certain assets.
Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Fled LLP in New
York and David B. Stratton, Esq., at Pepper Hamilton LLP in
Wilmington, Del., represent the Official Committee of Unsecured
Creditors. Stephen D. Susman, Esq., at Susman Godfrey LLP and
William P. Bowden, Esq., at Ashby & Geddes, P.A., represent the
Equity Committee. The official committee of equity security
holders also tapped BDO USA as its tax advisor. Stacey R.
Friedman, Esq., at Sullivan & Cromwell LLP and Adam G. Landis,
Esq., at Landis Rath & Cobb LLP in Wilmington, Del., represent
JPMorgan Chase, which acquired the WaMu bank unit's assets prior
to the Petition Date.
On Jan. 7, 2011, the U.S. Bankruptcy Court for the District of
Delaware entered a 107-page opinion determining that the global
settlement agreement, among certain parties including WMI, the
Federal Deposit Insurance Corporation and JPMorgan Chase Bank,
N.A., upon which the Plan is premised, and the transactions
contemplated therein, are fair, reasonable, and in the best
interests of WMI. Additionally, the Opinion and related order
denied confirmation, but suggested certain modifications to the
Company's Sixth Amended Joint Plan of Affiliated Debtors that, if
made, would facilitate confirmation.
Washington Mutual has filed with the Bankruptcy Court a Modified
Sixth Amended Joint Plan and a related Supplemental Disclosure
Statement. The Company believes that the Modified Plan has
addressed the Bankruptcy Court's concerns and looks forward to
returning to the Bankruptcy Court to seek confirmation of the
Modified Plan.
WATERSCAPE RESORT: Court Confirms Chapter 11 Plan
-------------------------------------------------
Lisa Uhlman at Bankruptcy Law360 reports that Waterscape Resort
LLC is on track to emerge from its brief stint in Chapter 11
following the approval of its reorganization plan Friday, three
days after negotiating a way to resolve disputes with the hotel's
builders.
According to Law360, U.S. Bankruptcy Judge Stuart Bernstein
confirmed Waterscape Resort LLC's reorganization plan, which calls
for repaying much of the company's debt with proceeds from the
$128 million sale of the hotel section of the development.
About Waterscape Resort
Waterscape Resort LLC, aka Cassa NY Hotel And Residences, is a
Delaware limited liability company formed on or about Jan. 24,
2005. The principal office of the Debtor is at 15 West 34th
Street, New York, New York 10001. On July 19, 2005, Waterscape
acquired the property, consisting of the three contiguous
buildings at 66, 68 and 70 West 45th Street in Manhattan, for the
sum of $20 million to develop the property into a 45-storey
condominium project including a luxury hotel, a restaurant and
luxury residential apartments. The purchase was financed with a
$17 million acquisition loan and mortgage from U.S. Bank
Association.
Construction of the hotel and residential units, given the name
Cassa NY Hotel and Residences, commenced in July 2007. By the end
of September 2010, the hotel and residential units were completed.
The Debtor generates its revenue from guests who stay at the hotel
and in the Debtor's residential condominium units, and from sales
of unsold residential condominium units. The Debtor's hotel and
rental business has produced gross revenues of approximately
$17 million to $18 million on an annual basis, and by the end of
September 2010, the Debtor had sold five residential apartment
units for a total of approximately $12,710,340.
The Debtor's Cassa NY Hotel and Residences features 165 hotel
rooms, and above the hotel units, 57 residences. The Debtor's
restaurant will occupy the first level below ground, but will be
visible from the ground floor hotel lobby. The Debtor's
restaurant is not yet open for business.
The Debtor has for several months been embroiled in litigation
with numerous contractors and subcontractors who have asserted
alleged mechanics lien claims against the Property totaling
approximately $20 million.
As of the Petition Date, the Debtor had outstanding approximately
$134.4 million of secured loan principal obligations under credit
facilities with US Bank and USB Capital Resources, Inc. The debt
is secured by liens upon all of the assets of the Debtor,
including mortgages on the Debtor's real property, together with
liens on all rents, proceeds and cash of the Debtor, pledges of
member interests in Waterscape, and guarantees by Waterscape
members and other third-party grantors. The Debtor's secured debt
was incurred under three separate agreements for: (i) an
acquisition and project loan; (ii) a construction loan; and (iii)
a mezzanine loan; each of which was made in connection with the
acquisition or development of the Debtor's property.
Over the last several months, the Debtor engaged in extensive
negotiations with the Secured Lenders regarding the parameters of
a comprehensive restructuring. The Debtor also engaged in
extensive marketing efforts and negotiations to sell its hotel
assets to a non-insider buyer. The restructuring discussions
between the Debtor and the Secured Lenders reached an impasse, and
on March 21, 2011, UBS, the junior of the two Secured Lenders,
filed a foreclosure action against the Debtor in the Supreme Court
of the State of New York, County of New York.
The Debtor then filed for Chapter 11 bankruptcy protection (Bankr.
S.D.N.Y. Case No. 11-11593) on April 5, 2011. Brett D. Goodman,
Esq., and Lee William Stremba, Esq., at Troutman Sanders LLP
represent the Debtor as Bankruptcy Counsel. Holland & Knight LLP
serves as its special litigation counsel. The Debtor disclosed
$214,285,027 in assets and $158,756,481 in liabilities as of the
Chapter 11 filing.
WHITTLE DEVELOPMENT: Plan Hearing Scheduled for July 29
-------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas,
Dallas Division, approved the disclosure statement explaining the
Plan of Reorganization of Whittle Development Inc. and Mariah Bay
Development Inc. on June 29, 2011.
July 25, 2011, at 4:00 p.m., is fixed as the last day for filing
and serving written acceptances or rejections of the Plan. All
Ballots must be mailed or faxed to:
Attn: Whittle Development Ballots
Attn: Mariah Bay Development Ballots
Wright Ginsberg Brusilow P.C.
325 N. St. Paul Street, Suite 4150
Dallas, Texas 75201
Fax: (214) 744-2615
July 29, 2011, at 1:30 p.m., is fixed for the hearing on the
Confirmation of the Plan.
The Plan, according to E.P. Keiffer, Esq., at Wright Ginsberg
Brusilow P.C., in Dallas, Texas, was drafted with the mission of
providing for the marketing and sale of the land portfolio of each
of the Debtors in a manner which will enable the unsecured
creditors to capture the resident equity in those portfolios,
while affording the secured creditors adequate protection of their
interests and a more dedicated sales force to enable their
collateral to fetch a higher price than they could secure vis-…-
vis foreclosure and marketing their portions of these Debtors
portfolios. The Plan, he adds, enables unsecured creditors to
participate without the effect of the large guaranty claim of City
Bank Texas.
In essence the Plan is, in many respects, a controlled liquidation
of the Debtors' portfolios, with a prospect that, with the help of
the provisions regarding City Bank, all creditors in both cases
will have their allowed claims paid in full, Mr. Keiffer says.
A full-text copy of the Disclosure Statement, dated June 24, 2011,
is available for free at:
http://bankrupt.com/misc/WHITTLEDEVT_disclosurestatement_amendment.pdf
About Whittle Development
Rockwall, Texas-based Whittle Development Inc. is a Sub Chapter S
property development company wholly owned by Robert S. Whittle. It
owns significant acreage in and around the northeastern shore of
Lake Ray Hubbard, as well as other parts of Rockwall County,
Texas. Its business is the sale and development of its holdings
for highest and best uses of its land "inventory" to third party
end users or other more direct developers.
Whittle Development filed for Chapter 11 bankruptcy protection on
October 4, 2010 (Bankr. N.D. Tex. Case No. 10-37084). Whittle
Development estimated its assets and debts at $10 million to
$50 million at the Petition Date.
Whittle Development's case is jointly administered with Rockwall,
Texas-based Mariah Bay Development Inc., which is also a Sub
Chapter S corporation wholly owned by Robert S. Whittle. Mariah
Bay filed for Chapter 11 bankruptcy protection (Bankr. N.D. Tex.
Case No. 10-37085) on Oct. 4, 2010. Mariah Bay estimated its
assets and debts at $10 million to $50 million at the Petition
Date.
Edwin Paul Keiffer, Esq., at Wright Ginsberg Brusilow P.C.,
assists the Debtors in their restructuring efforts.
Mariah Bay's affiliate, Mariah Bay Leasing Corporation, filed a
separate Chapter 11 petition on February 19, 2010 (Bankr. N.D.
Tex. Case No. 10-31171).
WHITTLE DEVELOPMENT: Agreement With City Bank Set for Mediation
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas,
Dallas Division, directed Whittle Development, Inc., and Mariah
Bay Development, Inc., and City Bank Texas to submit the disputes
existing between them to non-binding mediation.
The directive came after the Debtors, City Bank and Credit Union
Liquidity Solutions agreed to submit the dispute to mediation.
Credit Union filed an informal objection to the compromise
agreement entered into among the Debtors, City Bank and Heath Golf
and Yacht Club, Inc. The nature of the issues which the Debtors,
HGYC and City Bank seek to resolve if the compromise agreement is
approved were relating to the Debtors' statements of financial
affairs.
Among the principal terms of the compromise agreement are as
follows:
(1) City Bank will transfer to the Debtors $560,000 in either
cash or through releases by City Bank of liens in the
Debtors' properties;
(2) Each and every obligation of each of the Debtors to City
Bank arising from guarantees executed in connection with
the transactions between them in April and August 2010 and
both of the October 2010 transactions will be avoided,
released and fully extinguished;
(3) City Bank will release or revise its liens and claims
against WDI or MBD, as applicable;
(4) Each of the applicable Debtors will be granted, by HGYC,
with the consent of City Bank, a second priority
contractual lien position on the properties which that
Debtor transferred to HGYC;
(5) City Bank will retain all of its other liens, claims and
rights, and, effective upon entry of an order approving the
compromise agreement, the Debtors will forever releases,
acquits, and discharges City Bank from all claims or causes
of action of any kind whatsoever;
(6) City Bank's cumulative monetary obligations will be
reduced, as to the last amounts due under the CSA, by the
amount of any Bankruptcy Court approved Section 364
postpetition lending; and
(7) The Debtors, HGYC, Rob Whittle, the Debtors' principal, and
City Bank are authorized to execute any and all documents
necessary to implement and record the terms of the CSA,
without further order of the Bankruptcy Court, once the CSA
is approved by the Bankruptcy Court per the requirements of
Rule 9019 of the Federal Rules of Bankruptcy Procedure.
About Whittle Development
Rockwall, Texas-based Whittle Development Inc. is a Sub Chapter S
property development company wholly owned by Robert S. Whittle. It
owns significant acreage in and around the northeastern shore of
Lake Ray Hubbard, as well as other parts of Rockwall County,
Texas. Its business is the sale and development of its holdings
for highest and best uses of its land "inventory" to third party
end users or other more direct developers.
Whittle Development filed for Chapter 11 bankruptcy protection
(Bankr. N.D. Tex. Case No. 10-37084) on Oct. 4, 2010. Whittle
Development estimated its assets and debts at $10 million to
$50 million at the Petition Date.
Whittle Development's case is jointly administered with Rockwall,
Texas-based Mariah Bay Development Inc., which is also a Sub
Chapter S corporation wholly owned by Robert S. Whittle. Mariah
Bay filed for Chapter 11 bankruptcy protection on October 4, 2010
(Bankr. N.D. Tex. Case No. 10-37085). Mariah Bay estimated its
assets and debts at $10 million to $50 million at the Petition
Date.
Edwin Paul Keiffer, Esq., at Wright Ginsberg Brusilow P.C.,
assists the Debtors in their restructuring efforts.
Mariah Bay's affiliate, Mariah Bay Leasing Corporation, filed a
separate Chapter 11 petition (Bankr. N.D. Tex. Case No. 10-31171)
on Feb. 19, 2010.
WHITTLE DEVELOPMENT: Can Access $240,000 Loan on Final Basis
------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas,
Dallas Division, authorized Whittle Development, Inc., and Mariah
Bay Development, Inc., on a final basis, to enter into the City
Bank Third Short Term Loan Agreement for $240,000.
For each dollar drawn on the letter of credit the allocation of
junior liens among the Debtors' assets, will be 68% against the
real and personal assets of WDI and 32% against the assets of MBD
as they existed on the Petition Date. The City Bank Third Short
Term Loan will accrue interest at the rate of 6% and will also be
payable as an administrative claim under Section 503(b)(1) of the
Bankruptcy Code.
As security for any obligations under the City Bank Third Short
Term Loan, City Bank will have a junior secured position on
property of the estate, which those liens are valid, enforceable
and fully perfected.
About Whittle Development
Rockwall, Texas-based Whittle Development Inc. is a Sub Chapter S
property development company wholly owned by Robert S. Whittle. It
owns significant acreage in and around the northeastern shore of
Lake Ray Hubbard, as well as other parts of Rockwall County,
Texas. Its business is the sale and development of its holdings
for highest and best uses of its land "inventory" to third party
end users or other more direct developers.
Whittle Development filed for Chapter 11 bankruptcy protection on
October 4, 2010 (Bankr. N.D. Tex. Case No. 10-37084). Whittle
Development estimated its assets and debts at $10 million to
$50 million at the Petition Date.
Whittle Development's case is jointly administered with Rockwall,
Texas-based Mariah Bay Development Inc., which is also a Sub
Chapter S corporation wholly owned by Robert S. Whittle. Mariah
Bay filed for Chapter 11 bankruptcy protection on October 4, 2010
(Bankr. N.D. Tex. Case No. 10-37085). Mariah Bay estimated its
assets and debts at $10 million to $50 million at the Petition
Date.
Edwin Paul Keiffer, Esq., at Wright Ginsberg Brusilow P.C.,
assists the Debtors in their restructuring efforts.
Mariah Bay's affiliate, Mariah Bay Leasing Corporation, filed a
separate Chapter 11 petition (Bankr. N.D. Tex. Case No. 10-31171)
on Feb. 19, 2010.
WINGATE AIRPORT: Wants to Borrow $1,883 Monthly to Pay Interest
---------------------------------------------------------------
Wingate Airport South, LLC, asks the U.S. Bankruptcy Court for the
District of Nevada for permission to obtain unsecured post-
petition financing of $1,883.50 per month (per diem rate of
$129.45 interest x 30 days) from principal, Ronald J. Robinson, to
make and pay monthly interest payments on the secured loan in
favor of Creditor 2009-1 CRE-Venture, LLC.
Mr. Robinson is not seeking interest payments on said loans.
The Debtor says the requested loans will allow it time to obtain
the necessary financing to compete the project.
As of the Petition, the amount owed to CRE totaled $1,293,480.68,
consisting of an unpaid principal balance of $1,096,516.67 and
accrued interest of $55,502.22, with late charges and other fees
of $41,327.63.
The Debtor relates that under 11 U.S.C. Section 101(51B), single
asset real estate debtors are required to file a plan or
reorganization (that has a reasonable possibility of being
confirmed within a reasonable time) or commence making monthly
payments within 90 days of the filing of the petition, or the
automatic stay is lifted.
Las Vegas, Nevada-based Wingate Airport South, LLC, owns real
property located at 355 E. Warm Springs Road, Las Vegas, Nevada,
consisting of a partially completed Wyndham Hotel and land. The
Company filed for Chapter 11 bankruptcy protection (Bankr. D. Nev.
Case No. 11-11950) on Feb. 11, 2011. In its schedules, the Debtor
disclosed $12,000,000 in assets and $9,497,529 in liabilities as
of the Petition Date. Neil J. Beller, Esq., at Neil J. Beller,
Ltd., in Las Vegas, represents the Debtor as counsel.
On June 20, 2011, the Bankruptcy Court entered an order
determining that the Debtor is a "Single Asset Real Estate" Debtor
pursuant to 11 U.S.C. Sections 101(51B) and 362(D)(3).
WOLVERINE TUBE: U.S. Trustee Objects to Plan Confirmation
---------------------------------------------------------
Roberta A. DeAngelis, the United States Trustee for Region 3, asks
the U.S. Bankruptcy Court for the District of Delaware to deny
confirmation of the Plan of Reorganization filed by Wolverine
Tube, Inc., and its debtor affiliates, complaining that the
releases sought to be bestowed under several parties appear to
facially violate the ruling in In re Washington Mutual, Inc., et
al., 442 B.R. 314, 349-350 (Bankr. D. Del. 2011).
In the WaMu decision, the Court held, among other things, that
under applicable law, there was no basis whatsoever for the
debtors to grant releases to the debtors' directors and officers
or any professionals, current or former, because no evidence was
presented with respect to, among other things, a substantial
contribution" having been made to the case by the parties seeking
those releases, the U.S. Trustee notes.
With respect to the proposed release of third-party claims in
Article 10.21, the Plan Proponents must produce evidence
supporting the release of claims against certain third parties
and other entities including the officers and directors of non-
debtors, the U.S. Trustee asserts.
About Wolverine Tube
Huntsville, Alabama-based Wolverine Tube, Inc., is a global
manufacturer and distributor of copper and copper alloy tube,
fabricated products, and metal joining products. The Company
currently operates seven facilities in the United States, Mexico,
China, and Portugal. It also has distribution operations in the
Netherlands and the United States.
Wolverine Tube sought Chapter 11 bankruptcy protection (Bankr. D.
Del. Case No. 10-13522) on Nov. 1, 2010. Mark E. Felger, Esq.,
and Simon E. Fraser, Esq., at Cozen O'Connor represent the Debtor.
Scott K. Rutsky, Esq., and Adam T. Berkowitz, Esq., at Proskauer
Rose LLP, serve as the Debtor's special corporate and tax counsel.
Deloitte Financial Advisory Services LLP is the Debtor's financial
advisor. Donlin Recano & Company, Inc., is the Debtor's claim
agent. The Debtor disclosed $115 million in total assets and
$237 million in total debts at the time of the filing.
Affiliates Tube Forming, L.P. (Bankr. D. Del. Case No. 10-13523),
Wolverine Joining Technologies, LLC (Bankr. D. Del. Case No.
10-13524), TF Investor Inc. (Bankr. D. Del. Case No. 10-13525),
and WT Holding Company, Inc. (Bankr. D. Del. Case No. 10-13526)
filed separate Chapter 11 petitions.
No official committee of unsecured creditors has been appointed in
the case.
WORLDCOM INC: Liable for Trespass to Schuyler Hills
---------------------------------------------------
Bankruptcy Judge Arthur J. Gonzalez said WorldCom, Inc., is liable
for trespass to Schuyler Hills, Inc., for exceeding the scope of
an easement granting use of Schuyler Hills' property. He said
WorldCom's installation of an underground fiber optic cable
constitutes a misuse of the easement. Schuyler Hills filed claim
no. 21132 alleging a $1 million unsecured claim based on a
prepetition trespass litigation. Judge Gonzalez overruled
WorldCom's objection to the claim, as to the issue of liability,
with damages to be determined. The Court directed the parties to
contact chambers regarding the scheduling of a hearing to
determine damages based on the diminution in the rental or usable
value of the premises caused by the trespass. A copy of Judge
Gonzalez's July 21, 2011 Opinion and Order is available at
http://tinyurl.com/3r7uvbcfrom Leagle.com.
Attorney for Reorganized Debtors is:
Alfredo R. Perez, Esq.
WEIL, GOTSHAL & MANGES LLP
700 Louisiana, Suite 1600
Tel: 713-546-5040
E-mail: alfredo.perez@weil.com
Attorney for Schuyler Hills:
Joshua A. Sabo, Esq.
LAW OFFICE OF JOSHUA A. SABO
287 N Greenbush Road
Troy, NY 12180-8514
Tel: (518) 286-9050
WorldCom, Inc., a Clinton, MS-based global communications company,
filed for chapter 11 protection on July 21, 2002 (Bankr. S.D.N.Y.
Case No. 02-13532). On March 31, 2002, WorldCom disclosed
$103,803,000,000 in assets and $45,897,000,000 in debts. The
Bankruptcy Court confirmed WorldCom's Plan on Oct. 31, 2003, and
on Apr. 20, 2004, the Company formally emerged from U.S. Chapter
11 protection as MCI, Inc. On Jan. 6, 2006, MCI merged with
Verizon Communications, Inc. MCI is now known as Verizon
Business, a unit of Verizon Communications.
WORLDGATE COMMUNICATIONS: Edward Cummings Appointed PFO and PAO
---------------------------------------------------------------
Effective as of July 15, 2011, Edward L. Cummings was appointed as
the Principal Financial Officer and Principal Accounting Officer
of WorldGate Communications, Inc. Mr. Cummings has been retained
as a consultant and is being paid $7,916 per month.
From 2001 to October 2009, Mr. Cummings served as Chief Financial
Officer of QSGI Inc., a publicly traded information technology
asset management company. From October 2009 through June 2011,
Mr. Cummings worked as a financial consultant preparing SEC
filings and financial statements for QSGI Inc. Mr. Cummings is 62
years old.
About Worldgate Communications
Trevose, PA, WorldGate Communications, Inc. (OTC BB: WGAT.OB)
designs and develops innovative digital video phones featuring
high quality, real-time, two-way video.
The Company's balance sheet at March 31, 2011, showed $9.7 million
in total assets, $15.9 million in total liabilities, and a
stockholders' deficit of $6.2 million.
As reported in the TCR on April 12, 2011, Marcum LLP, in New York,
expressed substantial doubt about WorldGate Communications'
ability to continue as a going concern, following the Company's
2010 results. The independent auditors noted that of the
Company's recurring losses from operations, working capital
deficiencies and stockholders' deficit.
ZAIS INVESTMENT: Noteholders Propose Chap. 11 Plan for Fund
-----------------------------------------------------------
GRF Master Fund, L.P., Anchorage Illiquid Opportunities Offshore
Master, L.P., and Anchorage Capital Master Offshore, Ltd.,
proposed a plan of reorganization and accompanying disclosure
statement for Zais Investment Grade Limited VII.
The Plan is premised upon the formation of a new investment
vehicle holding, managing and eventually monetizing substantially
all of the Debtor's assets, according to the Plan Proponents. The
Plan adheres to the contractual payment waterfall and
subordination provisions of a prepetition indenture with JP Morgan
Chas Bank, National Association, and provides for the payment in
full of all Claims senior to the Senior Notes Claims and a pro
rata distribution to the Senior Noteholders of the remaining net
Cash proceeds from the liquidation of the Designated Assets.
All Old Equity Interests and Claims junior to the Senior Note
Claims will receive no distribution under the Plan.
The Plan provides for this classification and treatment of claims:
Administrative Claims: Paid on the Effective Date.
Est. Recovery: 100%
Tax Claims: Paid on the Effective Date.
Est. Recovery: 100%
Class 1 - Senior Indenture
Administrative Expense
CLaims: Unimpaired. Paid in Cash.
Est. Recovery: 100%
Class 2 - Indenture
Priority Claims: Unimpaired. Paid in Cash, plus
interest.
Est. Recovery: 100%
Class 3 - Senior Note
Claims: Impaired. Will receive Pro Rata
Share of Available Cash.
Est. Recovery: 71.84%
Class 4 - Junior A-2 Note
Claims: Impaired. Will not receive any
property under the Plan.
Est. Recovery: None
Class 5 - Junior A-3 Note
Claims: Impaired. Will not receive any
property under the Plan.
Est. Recovery: None
Class 6 - Junior B-1 Note
Claims: Impaired. Will not receive any
property under the Plan.
Est. Recovery: None
Class 7 - Junior B-2 Note
Claims: Impaired. Will not receive any
property under the Plan.
Est. Recovery: None
Class 8 - Subordinated
Claims: Impaired. Will not receive any
property under the Plan.
Est. Recovery: None
Class 9 - Income Note
Claims: Impaired. Will not receive any
property under the Plan.
Est. Recovery: None
Class 10- General
Unsecured Claims: Impaired. Will not receive any
property under the Plan.
Est. Recovery: None
Class 11 - Old Equity
Interests: Impaired. Will not receive any
property under the Plan.
Est. Recovery: None
The Plan Proponents, when combined, hold $145,357,000 aggregate
original principal amount of Senior Notes and $10,000,000
aggregate original principal amount of Junior Notes and Income
Notes as of March 15, 2011. The Plan Proponents are managed by
Anchorage Capital Group, L.L.C.
A full-text copy of the Disclosure Statement, dated March 15,
2011, is available for free at:
http://ResearchArchives.com/t/s?7629
Zais Investment Grade Limited VII is based in Grand Cayman.
On April 1, 2011, Anchorage Capital Master Offshore, Ltd., GRF
Master Fund, L.P., and Anchorage Illiquid Opportunities Offshore
Masters, L.P. filed an involuntary Chapter 11 petition against
Zais Investment Grade Limited VII. On April 26, 2011, the U.S.
Bankruptcy Court for the District of New Jersey entered an order
for relief under chapter 11 of the Bankruptcy Code.
The Debtor tapped Wollmuth Maher & Deutsch LLP as general
bankruptcy counsel, Maples and Calder as Cayman Islands counsel,
and Jones Day as special counsel.
ZESTRA LAB: N.J. Appeals Court Rules on Finder's Fee Suit
---------------------------------------------------------
The Superior Court of New Jersey, Appellate Division, affirmed an
order of the Law Division dismissing the complaint by Harold P.
Mintz, managing member of Enhancement Associates, against Semprae
Laboratories, New Spring Capital Partners, Zev Scherl, Racherl
Scherl, Mary Jaensch, The Jannick Group, Ira Lubert, Quaker
Bioventures and Independence Capital Partners for failure to state
a cause of action. Mr. Mintz sued to collect on his alleged
$200,000 finder's fee while brokering a deal by the defendants to
acquire Zestra Laboratories, Inc.
Mr. Mintz has failed to file any administrative claim for any
monies due regarding services rendered to Zestra. He has objected
to the Disclosure Statement explaining Zestra's Chapter 11 Plan of
Liquidation.
The lawsuit is Harold P. Mintz, d/b/a Enhancement Associates,
Plaintiff-Appellant, v. Semprae Laboratories, New Spring Capital
Partners, Zev Scherl, Rachel Scherl, Mary Jaensch, The Jannick
Group, Ira Lubert, Quaker Bioventures, Independence Capital
Partners, Defendants-Respondents, No. A-1561-10T1 (N.J. Sup. Ct.).
A copy of the Court's July 21, 2011 decision is available at
http://is.gd/p5pNMmfrom Leagle.com.
Based in Charleston, South Carolina, Zestra Laboratories, Inc.,
aka Qualilife Pharmaceuticals Inc., manufactured sexual health
products. It filed for Chapter 11 bankruptcy (Bankr. D. Del. Case
No. 08-11313) on June 29, 2008. Judge Kevin J. Carey presides
over the case. Chun I. Jang, Esq., Cory D. Kandestin, Esq., John
Henry Knight, Esq., and Paul Noble Heath, Esq., at Richards,
Layton & Finger, P.A., serve as bankruptcy counsel. In its
petition, the Debtor estimated assets and debts of $1 million to
$10 million. A copy of Zestra Laboratories, Inc.'s petition is
available for free at http://bankrupt.com/misc/deb08-11313.pdf
* BOND PRICING -- For Week From July 4 - 8, 2011
------------------------------------------------
Company Coupon Maturity Bid Price
------- ------ -------- ---------
ACARS-GM 8.10 6/15/2024 1.00
AHERN RENTALS 9.25 8/15/2013 45.25
AMBAC INC 5.95 12/5/2035 13.25
AMBAC INC 6.15 2/7/2087 1.75
AMBAC INC 7.50 5/1/2023 15.25
AMBAC INC 9.50 2/15/2021 13.50
BANK NEW ENGLAND 8.75 4/1/1999 13.50
BANK NEW ENGLAND 9.88 9/15/1999 14.00
BANKUNITED FINL 3.13 3/1/2034 7.10
BANKUNITED FINL 6.37 5/17/2012 7.00
BLOCKBUSTER INC 11.75 10/1/2014 5.00
BURLINGTON/SANTA 6.75 7/15/2011 98.99
CAPMARK FINL GRP 5.88 5/10/2012 59.75
CHAMPION ENTERPR 2.75 11/1/2037 1.50
CS FINANCING CO 10.00 3/15/2012 3.00
DG-CALL07/11 10.63 7/15/2015 105.62
DIRECTBUY HLDG 12.00 2/1/2017 39.00
DIRECTBUY HLDG 12.00 2/1/2017 39.00
DUNE ENERGY INC 10.50 6/1/2012 68.50
EDDIE BAUER HLDG 5.25 4/1/2014 5.63
ELEC DATA SYSTEM 3.88 7/15/2023 95.00
EVERGREEN SOLAR 4.00 7/15/2020 13.00
EVERGREEN SOLAR 13.00 4/15/2015 37.25
F-CALL07/11 6.15 1/20/2015 99.90
FAIRPOINT COMMUN 13.13 4/2/2018 1.25
FRANKLIN BANK 4.00 5/1/2027 7.00
GREAT ATLA & PAC 6.75 12/15/2012 31.50
GREAT ATLANTIC 9.13 12/15/2011 25.50
HARRY & DAVID OP 9.00 3/1/2013 11.50
INTL LEASE FIN 6.85 7/15/2011 99.76
KEYSTONE AUTO OP 9.75 11/1/2013 40.00
LEHMAN BROS HLDG 2.00 8/1/2013 24.38
LEHMAN BROS HLDG 3.00 11/17/2012 24.25
LEHMAN BROS HLDG 4.70 3/6/2013 23.55
LEHMAN BROS HLDG 4.80 2/27/2013 24.75
LEHMAN BROS HLDG 4.80 3/13/2014 25.75
LEHMAN BROS HLDG 5.00 1/22/2013 24.50
LEHMAN BROS HLDG 5.00 2/11/2013 24.50
LEHMAN BROS HLDG 5.00 3/27/2013 24.50
LEHMAN BROS HLDG 5.00 8/3/2014 24.25
LEHMAN BROS HLDG 5.00 8/5/2015 25.15
LEHMAN BROS HLDG 5.10 1/28/2013 24.50
LEHMAN BROS HLDG 5.15 2/4/2015 22.50
LEHMAN BROS HLDG 5.25 2/6/2012 25.63
LEHMAN BROS HLDG 5.25 1/30/2014 20.00
LEHMAN BROS HLDG 5.25 2/11/2015 25.00
LEHMAN BROS HLDG 5.50 4/4/2016 24.75
LEHMAN BROS HLDG 5.75 5/17/2013 25.00
LEHMAN BROS HLDG 6.00 7/19/2012 24.50
LEHMAN BROS HLDG 6.20 9/26/2014 26.50
LEHMAN BROS HLDG 6.63 1/18/2012 25.63
LEHMAN BROS HLDG 6.80 9/7/2032 15.00
LEHMAN BROS HLDG 7.00 6/26/2015 23.55
LEHMAN BROS HLDG 7.00 12/18/2015 25.00
LEHMAN BROS HLDG 8.05 1/15/2019 23.50
LEHMAN BROS HLDG 8.40 2/22/2023 22.24
LEHMAN BROS HLDG 8.50 8/1/2015 23.75
LEHMAN BROS HLDG 8.80 3/1/2015 24.15
LEHMAN BROS HLDG 9.50 1/30/2023 22.63
LEHMAN BROS HLDG 9.50 2/27/2023 22.63
LEHMAN BROS HLDG 10.00 3/13/2023 22.63
LEHMAN BROS HLDG 10.38 5/24/2024 25.25
LEHMAN BROS HLDG 11.00 6/22/2022 24.50
LEHMAN BROS HLDG 11.00 7/18/2022 24.50
LEHMAN BROS HLDG 18.00 7/14/2023 24.63
LEHMAN BROS INC 7.50 8/1/2026 14.75
LIFETIME BRANDS 4.75 7/15/2011 99.71
LIFETIME BRANDS 4.75 7/15/2011 100.06
LOCAL INSIGHT 11.00 12/1/2017 2.25
MAJESTIC STAR 9.75 1/15/2011 14.75
MOHEGAN TRIBAL 8.00 4/1/2012 83.50
NBC ACQ CORP 11.00 3/15/2013 8.64
NEBRASKA BOOK CO 8.63 3/15/2012 74.88
NEWPAGE CORP 10.00 5/1/2012 30.00
NEWPAGE CORP 12.00 5/1/2013 8.75
PROPEX FABRICS 10.00 12/1/2012 1.00
RASER TECH INC 8.00 4/1/2013 29.76
RESTAURANT CO 10.00 10/1/2013 11.00
RIVER ROCK ENT 9.75 11/1/2011 87.75
SONAT INC 7.63 7/15/2011 99.94
SPHERIS INC 11.00 12/15/2012 1.88
TEXAS COMP/TCEH 7.00 3/15/2013 29.00
THORNBURG MTG 8.00 5/15/2013 11.50
TIMES MIRROR CO 7.25 3/1/2013 50.00
TOUSA INC 9.00 7/1/2010 15.00
TOYOTA-CALL07/11 6.00 7/20/2027 100.15
TRANS-LUX CORP 8.25 3/1/2012 14.00
TRANS-LUX CORP 9.50 12/1/2012 15.25
TRICO MARINE 3.00 1/15/2027 1.25
TRICO MARINE SER 8.13 2/1/2013 8.50
VIRGIN RIVER CAS 9.00 1/15/2012 47.25
WCI COMMUNITIES 4.00 8/5/2023 1.57
WCI COMMUNITIES 7.88 10/1/2013 0.55
WESCO INTL 1.75 11/15/2026 89.00
WII COMPONENTS 10.00 2/15/2012 85.00
WILLIAM LYON INC 10.75 4/1/2013 50.45
WILLIAM LYONS 7.63 12/15/2012 56.00
WINDERMERE BAPT 7.70 5/15/2012 21.00
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers"
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com/
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
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. Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine
Tumanda, Howard C. Tolentino, Joseph Medel C. Martirez, Denise
Marie Varquez, 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 2011. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $775 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Christopher
Beard at 240/629-3300.
*** End of Transmission ***