/raid1/www/Hosts/bankrupt/TCR_Public/111102.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, November 2, 2011, Vol. 15, No. 304
Headlines
3000 POYDRAS: Voluntary Chapter 11 Case Summary
ACCP I: Case Summary & Largest Unsecured Creditor
ACORN ELSTON: Wins Nod to Sell Assets in Chody-Led Auction
AHWATUKEE SELF: Business Sold to Storage Experts for $1.62-Mil.
AIRTRAN AIRWAYS: Moody's Ups Enhanced Equipment Trust to 'Ba1'
ALAMO CITY LODGING: Best Western Hotel Operator in Bankruptcy
ALCOMA GOLF: Files for Chapter 11 to Block Sheriff's Sale
AMERICAN CHILD: Case Summary & Largest Unsecured Creditor
ANDRONICO'S MARKETS: Court OKs Hinman & Carmichael as Counsel
ARCADIA MANUFACTURING: Files for Chapter 11 Bankruptcy Protection
AWESOME ACQUISITION: S&P Withdraws 'B' Corporate Credit Rating
BAHIA SALINAS: Case Summary & 20 Largest Unsecured Creditors
BEACON POWER: Files for Chapter 11 in Delaware
BEAR ISLAND: Maturity of DIP Credit Agreement Extended to Nov. 30
BERNARD L. MADOFF: Appeal of $1-Bil. Settlement Up for Dismissal
BLOSSMAN BANCSHARES: Files for Bankruptcy to Sell Bank to NBC
BURNSVILLE LAND: Voluntary Chapter 11 Case Summary
C F SPORTS: Case Summary & 7 Largest Unsecured Creditors
CAFE FUNCHAL: Works With Millennium bcpbank to Restructure Debt
CAREFREE WILLOWS: Wants Prelim. Injunction Against AG/ICC Willows
CASCADE GLADES: Voluntary Chapter 11 Case Summary
CHRYSLER LLC: Consumer Warranty Claims Barred by Sale Order
CLAUDIO OSORIO: Miami Home Subject to November 3 Auction
COLFAX CORP: Moody's Assigns 'Ba3' Corporate Family Rating
CONTESSA PREMIUM: Committee Dissatisfied with Plan Disclosures
CROWN CASTLE: Fitch Affirms Issuer Default Ratings at 'BB'
CRYSTAL CATHEDRAL: Chapman University to Buy Assets Under Plan
DETROIT COMMUNITY: S&P Cuts Rating on Series 2005 Bonds to 'B+'
DLH MASTER: Hearing on Allen and RSAI Plan Outline Set for Nov. 17
DUKE AND KING: Files Third Amended Joint Plan of Liquidation
EREZ HEALTH: Court Accepts Valuation of Dover Woods Facility
EVERGREEN SOLAR: Puts Midland Plant on Auction Block
EVERGREEN SOLAR: Files Schedules of Assets and Liabilities
FKF MADISON: Jones Lang Seeks Buyer; Bids Due Dec. 8
FOREST CITY: S&P Affirms 'B+' Corporate Credit Rating
FRESH HARVEST: Court Rules in Catahama v. Kerry Lawsuit
GARY PHILLIPS: Construction Loan Extended Until End of 2013
GIORDANO'S ENTERPRISES: Ch. 11 Trustee Wants IFN as Lead Bidder
GLOBAL GEOPHYSICAL: Moody's Affirms 'B2' Corporate Family Rating
HARRINGTON WEST: TruPS Holders Seek Chapter 7 Liquidation
HARRISBURG, PA: Mayor Finds Defects in Bankruptcy Filing
HARVEST OAKS: Further Amends Plan Outline, Has Nov. 9 Hearing
HAWAII MEDICAL: Owners Seek New Buyer After SFHS Abandons Plan
HERBASWAY LAB: Case Summary & 20 Largest Unsecured Creditors
HOLLIFIELD RANCHES: Amends Plan Outline, Hearing Moved to Nov. 22
KEELEY AND GRABANSKI: Section 341(a) Meeting Scheduled for Dec. 2
KINETIC CONCEPTS: S&P Assigns 'BB-' Rating to $325-Mil. Term Loan
KOREA TECHNOLOGY: U.S. Trustee Appoints 3-Member Creditors' Panel
LIN TV: S&P Affirms 'B' Corp. Credit Rating; Outlook Stable
L K IMPERIAL: Case Summary & Largest Unsecured Creditor
LANDAMERICA FINANCIAL: Court Rejects Severance Claims
LAS VEGAS MONORAIL: US Bank Wants Resolicitation Order "Expunged"
LEHMAN BROTHERS: Proposes Derivates Pact Amendment Protocol
LEHMAN BROTHERS: Insurers to Cover CalPERS Suit Settlement
LEHMAN BROTHERS: JPM Keeps Docs on $6.3BB Claim Dispute Under Seal
LEHMAN BROTHERS: Gets Court Okay to Take Over Moonlight Basin
LEHMAN BROTHERS: Claims Trading Reach $10-Bil. in July-September
LEHMAN BROTHERS: $1.442 Billion Already Paid to Advisors
LEHMAN BROTHERS: European Administrators Have Earned GBP400MM
LOS ANGELES DODGERS: Court Postpones Trial to November 29
MADISON HOTEL: Files Ch. 11 Plan & Disclosure Statement
MANISTIQUE PAPERS: Gets Final OK to Access $5-Mil. DIP Loan
MERCED FALLS: U.S. Trustee Unable to Form Committee
MF GLOBAL: Bankruptcy to Hand JC Flowers $47.8-Mil. Net Loss
MOUNTAIN CITY: Gets Court Nod to Sell All Assets to MCM
NATE'S SEAFOOD: Case Summary & 20 Largest Unsecured Creditors
NATIONAL ENVELOPE: Stuck With Polluted Plant, Requests Conversion
NB&J LLC: Case Summary & Largest Unsecured Creditor
NELSON EDUCATION: Moody's Affirms 'B3' Corporate Family Rating
NICK REYNOLDS: Case Summary & 20 Largest Unsecured Creditors
NORTHGATE CROSSING: Court Denies Approval of Disclosure Statement
NUTRITION 21: Court Sets November 3 Sale Order Hearing
OPEN RANGE: U.S. Trustee Appoints 7-Member Creditors' Panel
PENINSULA HOSPITAL: 50 Workers Gets Layoff Notifications
PENINSULA HOSPITAL: Names Thomas Egan as Chief Financial Officer
PLATEAU ENERGY: Grand Valley Bank Wins Permission to Foreclose
PLAYPOWER INC: Moody's Assigns 'Caa1' Corporate Family Rating
PRECISION PARTS: Plan Gets Approval at Oct. 28 Confirmation
PROTECTIVE PRODUCTS: Court Confirms Unsecured Creditors' Plan
QIMONDA AG: 11 U.S.C. Sec. 365(n) Applies to U.S. Patents
QUALTEQ INC: Bank of America Opposes $4.5 Million Loan
RADIOSHACK: Fitch Lowers Long-Term Issuer Default Rating to 'B+'
REAL MEX: Committee Opposes Quick Sale and New Loan
REPUBLIC MORTGAGE: S&P Assigns Unsolicited 'CC' Rating
REYNOLDS FUNERAL: Case Summary & 20 Largest Unsecured Creditors
RIVER ROCK: S&P Lowers Issuer Credit Rating to 'CCC'
ROBERT SANDERS: Bankruptcy Halts Navistar v. DC Acquisitions Suit
ROOFING SUPPLY: Moody's Affirms 'B2' Corporate Family Rating
SALINAS INVESTMENTS: Court Sets Nov. 30 Confirmation Hearing
SEAVIEW PLACE: Combined Hearing on Plan and Disclosures Dec. 1
SHELDRAKE LOFTS: Court OKs Ditchik and Griffin as Special Counsel
SMART & FINAL: Moody's Reviews 'B3' CFR for Possible Downgrade
SOUTH EDGE: Court Confirms Joint Plan of Reorganization
SOUTHERN MONTANA ELECTRIC: Coops Mull Suit to Stop Bankruptcy Case
THINKFILM INC: Creditors Get Judge's Approval to Develop Plan
TOWER OAKS: Court Rejects Request to Prohibit Cash Collateral Use
TRIBUNE CO: Court Denies Confirmation of Competing Plans
TRIBUNE CO: Wants Until Feb. 29 to Remove Causes of Action
TRIBUNE CO: BNP Paribas, et al., Compelled to Produce Documents
TRINITY INNOVATIVE: Ch. 7 Trustee's Suit v. DirectBuy Pared Down
U.S. FIDELIS: Has Access to Mepco's Cash Collateral Until Dec. 31
US FT HOLDCO: Moody's Assigns 'B2' CFR; Outlook Stable
WAGSTAFF MINNESOTA: KFC Appeal Can't Bypass District Court
WAINRIGHT BUILDING: Files for Bankruptcy to Avoid Foreclosure
WINDRUSH SCHOOL: Kaufman Gets Vacation Pay; Director to Step Down
WYNDHAM WORLDWIDE: Moody's Raises Sr. Unsec. Ratings From 'Ba1'
XYIENCE INC: Plan Trustee Wins Sanctions Against Zyen, Fertitta
ZENITH NATIONAL: S&P Lowers Counterparty Credit Rating to 'BB+'
* Class Suit Pending Over Freeze on Joint Bank Accounts
* J.H. Cohn and Kostin Ruffkess Agree on Merger
* Michael C. Sullivan Joins Deloitte's Reorganization Practice
* Upcoming Meetings, Conferences and Seminars
*********
3000 POYDRAS: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Debtor: 3000 Poydras, L.L.C.
1100 Poydras Street
Suite 3000, Energy Centre
New Orleans, LA 70163
Bankruptcy Case No.: 11-13486
Chapter 11 Petition Date: October 24, 2011
Court: United States Bankruptcy Court
Eastern District of Louisiana (New Orleans)
Judge: Jerry A. Brown
Debtor's Counsel: William E. Steffes, Esq.
STEFFES VINGIELLO & MCKENZIE LLC
13702 Coursey Boulevard, Building 3
Baton Rouge, LA 70817
Tel: (225) 751-1751
Fax: (225) 751-1998
E-mail: bsteffes@steffeslaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $500,001 to $1,000,000
The Debtor did not file a list of its largest unsecured creditors
together with its petition.
The petition was signed by Alexander A. Sheshunoff, sole member.
ACCP I: Case Summary & Largest Unsecured Creditor
-------------------------------------------------
Debtor: ACCP I, LLC
3131 East Camelback Road, Suite 420
Phoenix, AZ 85016
Bankruptcy Case No.: 11-29742
Chapter 11 Petition Date: October 24, 2011
Court: United States Bankruptcy Court
District of Arizona (Phoenix)
Judge: Sarah Sharer Curley
Debtor's Counsel: Michael W. Carmel, Esq.
MICHAEL W. CARMEL, LTD.
80 E. Columbus Ave
Phoenix, AZ 85012-4965
Tel: (602) 264-4965
Fax: (602) 277-0144
E-mail: michael@mcarmellaw.com
Estimated Assets: $0 to $50,000
Estimated Debts: $10,000,001 to $50,000,000
In its list of 20 largest unsecured creditors, the Company placed
only one entry:
Entity Nature of Claim Claim Amount
------ --------------- ------------
ABC Learning Ctrs/ABC $40,000,000
Developmental
c/o Holland & Hart, LLP
3800 Howard Hughes Parkway,
10th Floor
Las Vegas, NV 89169
The petition was signed by RCS Capital Development, LLC, managing
member.
ACORN ELSTON: Wins Nod to Sell Assets in Chody-Led Auction
----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved Acorn Elston, LLC's request to conduct a private sale of
substantially all of its assets in an auction led by to Chody Real
Estate Corp., or its assignee.
The Court also approved:
1. the related settlement agreement in connection with and
effective upon consummation of the sale to the successful
purchaser -- the agreement was entered among the Debtor, lender
Road Bay Investments, LLC, as successor to the interest of
Allstate Life Insurance Company with respect to the property --
Elston Plaza Shopping Center, located in Chicago, Illinois, and
John B. Coleman, sole shareholder and managing member of the
Debtor; and
2. the resolution of all disputes among the parties to be
effectuated simultaneously with the closing of the sale.
The principal terms of the Term Sheet dated Sept. 21, 2011,
include, among other things:
Seller: Acorn Elston, LLC
Proposed Purchaser: Chody Real Estate Corp., or its
assignee
Purchased Assets: Chody will purchase substantially all of
the assets of the Debtor, including,
without limitation, the property, free
and clear of all liens, claims, and
interests in the property, pursuant to
section 363(f) of the Bankruptcy Code,
except as otherwise agreed between the
Debtor and Chody pursuant to the
Definitive Documentation.
Purchase Price: $18.2 million in cash, upon closing
Due Diligence: The Proposed Purchaser will commence its
due diligence immediately, and will
conclude its due diligence by no later
than Nov. 7, 2011.
Deposit: Within five business days after
execution of the Definitive
Documentation, Chody will deposit
$100,000 in an escrow account with a
mutually agreeable title company. Upon
successful completion of Chody's due
diligence, Chody will deposit an
additional $400,000 in such escrow
account.
Closing: The consummation of the sale to the
proposed purchaser (assuming the
proposed purchaser is the successful
purchaser) will occur no later than
Nov. 30, 2011.
The Debtor relates that specifically, approval and consummation of
the settlement agreement will result in substantial benefit to the
Debtor's estate, as upon its implementation, these will occur:
-- All litigation among the parties related to the property
will be fully and finally resolved, enabling the Debtor's estate
to avoid further cost and uncertainty attendant to litigation
regarding myriad issues related to the property;
-- The parties will exchange mutual releases attendant to any
and all matters related to the property and the case;
-- The Debtor will secure the payment of sale proceeds of at
least $18.2 million, which reflects fair and reasonable
consideration in exchange for the purchase of the property;
-- The lender will receive a cash payment directly from the
purchaser in the settled amount of at least $17.4 million, as
required under the stipulation, which reflects a reasonable
compromise of the lender's asserted claim against the Debtor's
estate of not less than $19 million; and
-- Sale proceeds in excess of amounts payable to the lender
under the stipulation may, depending upon the costs to the
Debtor's estate of consummating the sale, potentially be
available to satisfy certain other claims against the estate.
The Debtor will convene a hearing on Nov. 8, at 10:00 a.m., to
consider approval of the sale. Objections, if any, are due Nov.
1, at 4:00 p.m. (EST). Adequate assurance objection deadline (if
applicable) is on Nov. 7, 2011 at 12:00 p.m.
About Acorn Elston, LLC
New York City-based Acorn Elston, LLC, owns the Elston Plaza
Shopping Center, a grocery-anchored retail shopping center in
Chicago, Illinois. The Company filed for Chapter 11 protection
(Bankr. S.D.N.Y. Case No. 10-14807) on Sept. 11, 2010.
Cadwalader, Wickersham & Taft LLP, in New York, was tapped to
represent the Debtor in the Chapter 11 case effective April 19,
2011, after Kasowitz Benson Torres & Friedman withdrew as counsel.
The Debtor also tapped The Reznick Group as its accountant, D.E.
Shaw Real Estate Adviser LLC as its financial advisor, and
Weitzman Group, Inc., as its appraiser.
The Debtor disclosed $21,929,346 in assets and $16,488,389 in
liabilities as of the Chapter 11 filing.
The Court appointed C. Michelle Panovich as receiver with respect
to the Elston Plaza Shopping Center, and its rents, income and
proceeds.
AHWATUKEE SELF: Business Sold to Storage Experts for $1.62-Mil.
---------------------------------------------------------------
Inside Self-Storage reports that Ahwatukee Self Storage in
Phoenix, Arizona, was sold in October to Storage Experts of
Orange, California, for $1.62 million.
According to the report, the property comprises 25,600 net
rentable square feet in 239 storage units and 108 open parking
spaces for boats and RVs. Located at 1027 E. Fry Road, the
facility was being foreclosed by its lender and the seller had
filed Chapter 11 bankruptcy. The sale was ordered by the Federal
Bankruptcy Court in Phoenix.
Inside Self-Storage says the sale was negotiated by Bill Alter and
Denise Nunez of Rein & Grossoehme Commercial Real Estate, which
specializes in the sale of self-storage facilities.
Storage Experts is a private company established in 2010.
AIRTRAN AIRWAYS: Moody's Ups Enhanced Equipment Trust to 'Ba1'
--------------------------------------------------------------
Moody's Investors Service raised its ratings of Airtran Airways,
Inc's ("AirTran") Series 1999-1 Enhanced Equipment Trust
Certificates ("EETC"): A-tranche to Baa1 from Ba2, B-tranche to
Baa3 from B2 and C-tranche to Ba1 from B3. Moody's also affirmed
its other ratings for Southwest Airlines Co. ("Southwest"),
including the Baa3 senior unsecured rating and the ratings on
Southwest's Series 2007-1 EETC: A-tranche at A2 and B-tranche at
Baa3. The upgrades to the AirTran' EETC ratings conclude the
review for upgrade initiated when Southwest announced in September
2010 its plan to acquire AirTran.
Upgrades:
Issuer: AirTran Airways, Inc.
-- Senior Secured Enhanced Equipment Trust, Upgraded to a range
of Ba1 to Baa1 from a range of B3 to Ba2
Outlook Actions:
Issuer: AirTran Airways, Inc.
-- Outlook, Changed To Stable From Rating Under Review
RATINGS RATIONALE
The upgrade of the AirTran EETC ratings reflects that AirTran's
obligations and performance under the 1999-1 financing are now
guaranteed by Southwest. At estimates of between 75% and 80%, the
A-tranches of each of the company's two EETCs are about
comparable. However, Moody's considers the Boeing B717 aircraft
that comprise the collateral of the AirTran EETC to be less
attractive than the seven or eight year younger, more widely
operated Boeing B737-700 aircraft in the Southwest EETC, resulting
in the ratings differential. The ratings on the two junior
tranches in the AirTran EETC consider the limited equity cushion,
the applicability of Section 1110 of the U.S. Bankruptcy Code, the
benefit of the respective liquidity facilities and the limited
operator base for the B717 aircraft.
The principal methodology used in rating AirTran and Southwest was
the Global Passenger Airlines Industry Methodology published in
March 2009 and Enhanced Equipment Trust And Equipment Trust
Certificates Industry Methodology published in December 2010.
Southwest Airlines is the United State's largest carrier in terms
of originating domestic passengers boarded, as measured by the
U.S. Department of Transportation, presently serving 72 cities in
37 states. Based in Dallas, Texas, Southwest currently operates
more than 3,400 flights a day.
AirTran Airways is a wholly owned subsidiary of Southwest Airlines
Co. AirTran offers coast-to-coast, two-class service on North
America's newest all-Boeing fleet.
ALAMO CITY LODGING: Best Western Hotel Operator in Bankruptcy
-------------------------------------------------------------
Patrick Danner at the San Antonio Express-News reports that Alamo
City Lodging Group Inc. filed a voluntary Chapter 11 petition on
Oct. 21, 2011, listing both assets and debts between $1 million
and $10 million.
According to the report, the company asked a bankruptcy judge to
prohibit utilities from discontinuing service to the hotel. The
company has proposed depositing $5,000 in an interest-bearing
account to provide assures of payment to utilities for future
services.
John Bhatka is the hotel's general manager.
Alamo City Lodging Group Inc. owns Best Western Windsor Pointe
Hotel & Suites on Rittiman Road. The hotel is located at 4639
Rittiman Road in Texas. Alamo City Lodging was formed to develop,
own and operate the hotel, which was completed in 2007.
ALCOMA GOLF: Files for Chapter 11 to Block Sheriff's Sale
---------------------------------------------------------
Pittsburgh Post-Gazette reports that Arthur Hawk, the owners of
the Three Lakes Golf Course f.k.a. Alcoma Golf Club, filed for
Chapter 11 bankruptcy protection after the property was listed to
be sold in a sheriff's sale on Dec. 5, 2011.
The report relates that Sgt. Richard Fersch of the Allegheny
County sheriff's office said the bankruptcy filing halted the
sheriff's sale pending a resolution from bankruptcy court. A
preliminary hearing was scheduled for Oct. 27, 2011.
According to the report, Mr. Hawk said that when he bought the
course in 2006, he wasn't expecting the economy to take a turn for
the worse. S&T Bank, which holds the mortgage on the course,
filed for foreclosure, claiming that more than $1.2 million is
owed. Mr. Hawk said that the course and its banquet facilities
will remain open during the bankruptcy proceedings.
About Alcoma Golf
Alcoma Golf, L.P., based in Monroeville, Pennsylvania, filed for
Chapter 11 bankruptcy (Bankr. W.D. Pa. Case No. 11-26246) on
Oct. 6, 2011, Judge Judith K. Fitzgerald presiding. Donald R.
Calaiaro, Esq. -- dcalaiaro@calaiarocorbett.com -- at Calaiaro &
Corbett, P.C., serves as the Debtor's counsel. In its petition,
the Debtor estimated $1 million to $10 million in assets and
debts. The petition was signed by Arthur F. Hawk, president.
AMERICAN CHILD: Case Summary & Largest Unsecured Creditor
---------------------------------------------------------
Debtor: American Child Care Properties, LLC
3131 East Camelback Road, Suite 420
Phoenix, AZ 85016
Bankruptcy Case No.: 11-29741
Chapter 11 Petition Date: October 24, 2011
Court: United States Bankruptcy Court
District of Arizona (Phoenix)
Judge: Redfield T. Baum Sr.
Debtor's Counsel: Michael W. Carmel, Esq.
MICHAEL W. CARMEL, LTD.
80 E. Columbus Ave
Phoenix, AZ 85012-4965
Tel: (602) 264-4965
Fax: (602) 277-0144
E-mail: michael@mcarmellaw.com
Estimated Assets: $0 to $50,000
Estimated Debts: $10,000,001 to $50,000,000
In its list of 20 largest unsecured creditors, the Company placed
only one entry:
Entity Nature of Claim Claim Amount
------ --------------- ------------
ABC Learning Centers, Ltd. $40,000,000
c/o Chadbourne & Parke, LLP
30 Rockefeller Plaza
New York, NY 10112
The petition was signed by RCS Capital Development, LLC, managing
member.
ANDRONICO'S MARKETS: Court OKs Hinman & Carmichael as Counsel
-------------------------------------------------------------
Andronico's Markets Inc. sought and obtained permission from the
U.S. Bankruptcy Court for the Northern District of California to
employ Hinman & Carmichael LLP as special counsel.
About Andronico's Markets
Andronico's Markets, Inc., aka Andronico's Community Markets, is
an independent, specialty supermarket operator in the San
Francisco Bay Area. Founded in 1929, the Company operates seven
stores in prime upscale urban and suburban locations in Berkeley
(four stores), San Francisco, Los Altos, and San Anselmo.
Andronico's is a California C-corporation, owned by Solano
Enterprises LLC. The ownership of Solano Enterprises LLC is
divided among various Andronico family members.
Andronico's filed for Chapter 11 bankruptcy (Bankr. N.D. Calif.
Case No. 11-48963) on Aug. 22, 2011. Judge Edward D. Jellen
oversees the case. Attorneys at Murray & Murray, in Cupertino,
Calif., represent the Debtor as counsel. Bailey, Elizondo &
Brinkman, LLC, serves as financial advisor. The Official
Committee of Unsecured Creditors has tapped Winston & Strawn LLP
as its counsel.
The Debtor scheduled $18,520,090 in assets and $67,094,619 in
liabilities as of the Chapter 11 filing.
ARCADIA MANUFACTURING: Files for Chapter 11 Bankruptcy Protection
-----------------------------------------------------------------
Adam Sichko, reporter at the Business Review, says that Arcadia
Manufacturing Group Inc. declared on Oct. 25, 2011, bankruptcy
under Chapter 11 and may have to move out of its Green Island, New
York headquarters.
According to the report, Arcadia reported $3.5 million in assets
and about $5 million in debt. The company listed more than 200
creditors; the vast majority have unsecured debt, meaning there is
no guarantee they'll receive any of the money they are owed.
The report says Citizens Bank is the senior secured creditor in
the case, owed $2.1 million in loans and working lines of credit.
Other debt is connected to equipment purchases, including some
made after Arcadia spent $4 million to move into its 64,000-
square-foot space in Green Island.
"They are saddled with this residual debt from five years ago, and
it's just too big a burden. It just put too much pressure on their
cash flow," the report quotes Justin Heller at Nolan & Heller
LLP, as saying. "Citizens was certainly supportive. But the
company ultimately ran out of time and couldn't wait for things to
turn around any longer," Mr. Heller said.
Mr. Sichko, citing court documents, reports Arcadia owes $443,000
to Barton Mines Corp. LLC and developer Galesi Group, which leases
the Green Island space to Arcadia, is owed about $160,000.
Privately held Arcadia Manufacturing Group Inc. is a 42-year old
maker of metal parts with lasers and water-jets, and does a fair
amount of defense contracting.
AWESOME ACQUISITION: S&P Withdraws 'B' Corporate Credit Rating
--------------------------------------------------------------
Standard & Poor's Ratings Services withdrew all its ratings on
Coppell, Texas-based Awesome Acquisition Co. L.P. at the company's
request. The ratings withdrawn include the 'B' corporate credit
rating on Awesome Acquisition. The company recently repaid its
outstanding bank debt, and elected to withdraw the ratings.
BAHIA SALINAS: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Bahia Salinas Beach Hotel, Inc.
HC-2 Box 2356
Boqueron, PR 00622
Bankruptcy Case No.: 11-09146
Chapter 11 Petition Date: October 25, 2011
Court: United States Bankruptcy Court
District of Puerto Rico (Ponce)
Debtor's Counsel: Gerardo L Santiago Puig, Esq.
Doral Bank Plaza Suite 801
33 Resolucion St
San Juan, PR 00920
Tel: (787) 777-8000
Fax: (787) 767-7107
E-mail: gsantiagopuig@yahoo.com
Estimated Assets: $100,001 to $500,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 20 largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/prb11-09146.pdf
The petition was signed by Miguel Rosado Martinez, president.
BEACON POWER: Files for Chapter 11 in Delaware
----------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Beacon Power Corp., a developer of flywheel
technology to store electric energy, filed for Chapter 11
protection on Oct. 30 in Delaware (Bankr. D. Del. Case No.
11-13450) after borrowing $39.1 million guaranteed by the U.S.
Energy Department.
Beacon filed with the Bankruptcy Court in Wilmington, Delaware.
Brown Rudnick and Potter Anderson & Corroon serve as the Debtor's
counsel.
Katy Stech, writing for Dow Jones' Daily Bankruptcy Review,
reports that Beacon used the U.S. backing to build a plant outside
Albany, N.Y., designed to store power and help electric companies
manage minute-by-minute movements in supply and demand. But the
firm said it was operating at a loss and couldn't raise more funds
amid the political furor over Solyndra LLC, whose bankruptcy
filing could cost taxpayers more than $500 million.
According to Bloomberg, the Company disclosed assets of
$72 million and debt totaling $47 million, including $39.1 million
owing on the government-guaranteed loan. Beacon originally
developed flywheel technology to serve as backup power for
telecommunications equipment. Later, it adapted the technology to
balance capacity on electric grids by either absorbing excess
energy or returning energy to the grid almost instantly when
required. Beacon built a $69 million facility with 20-megawatts
of balancing capacity in Stephentown, New York, funded mostly by
the Energy Department loan. The facility is operating at a loss,
court papers say.
The Bloomberg report relates that Beacon reported a $17 million
net loss for the first half of 2011 on revenue of $970,000.
Operating expenses totaled $11.5 million. The balance sheet at
June 30 listed property and equipment for $66.5 million.
Beacon has drawn down $39 million of its U.S.-guaranteed loan,
which carries the New York plant as collateral. According to DBR,
unlike the Solyndra case, in which the government agreed to take
second place behind other creditors for some assets, the U.S. has
first priority on the Beacon collateral.
DBR relates Rep. Cliff Stearns (R., Fla.) of the House Energy and
Commerce Committee called Beacon's bankruptcy filing "a sharp
reminder that [Department of Energy] has fallen well short of
delivering the stimulus jobs that were promised, and now taxpayers
find themselves millions of more dollars in the hole."
DBR recounts the White House last week said it had ordered an
independent review of the Energy Department program, which has
offered final or provisional guarantees for nearly $36 billion in
loans to projects in clean energy, electric cars and other areas.
Tyngsboro, Mass.-based Beacon Power Corporation (Nasdaq: BCOND)
-- http://www.beaconpower.com/-- designs, manufactures and
operates flywheel-based energy storage systems that it has begun
to deploy in company-owned merchant plants that sell frequency
regulation services in open-bid markets.
BEAR ISLAND: Maturity of DIP Credit Agreement Extended to Nov. 30
-----------------------------------------------------------------
Bear Island Paper Company, L.L.C, Credit Suisse AG, Toronto
Branch, as administrative Agent to the $140,000,000 Senior
Secured, Super-Priority Debtor-in-Possession Term Loan Agreement,
dated as of March 1, 2010, and BD Commercial Finance, L.L.C., as
syndication agent to the DIP Credit Agreement, have entered into a
fourth stipulation and agreed order regarding the Tenth Amendment
to the DIP Credit Agreement.
The Tenth DIP Amendment, entered into on Oct. 26, 2011, among
other things, extends the maturity Date and the deadline to
consummate the transactions contemplated under the Winning Bid
under Section 5.19(b)(vi) of the DIP Credit Agreement to Nov. 30,
2011.
On Aug. 10, 2010, the Debtor, along with Stadacona General
Partner, Inc., Stadacona L.P., F.F. Soucy General Partner Inc.,
F.F. Soucy, Inc. & Partners, L.P., F.F. Soucy L.P., Arrimage de
Gros Cacouna Inc. and Papier Masson Ltee, entered into an asset
sale agreement with BD White Birch Investment LLC to sell
substantially all of the Sellers' assets, which asset sale
agreement was approved on Nov. 3, 2010.
The Ninth DIP Amendment, among other things, had extended the
Maturity Date of the DIP Credit Agreement from Oct. 7, 2011, to
Oct. 31, 2011, and amended section 5.19(b)(vi) of the DIP Credit
Agreement to extend the deadline to consummate the transactions
contemplated under the Winning bid to Oct. 31, 2011.
As reported in the TCR on April 7, 2010, Bear Island received from
the U.S. Bankruptcy Court for the Eastern District of Virginia
final approval to obtain postpetition secured financing from a
syndicate of lenders led by Credit Suisse AG, as administrative
agent, and to use the cash collateral of existing secured lenders.
The DIP lenders have committed to provide up to $140 million to
fund the Chapter 11 case. A copy of the credit agreement is
available for free at:
http://bankrupt.com/misc/BEAR_ISLAND_dipfinancingpact.pdf
About White Birch & Bear Island
Canada-based White Birch Paper Company is the second largest
newsprint producer in North America. As of Dec. 31, 2009, the
White Birch Group held a 12% share of the North American newsprint
market and employed roughly 1,300 individuals (the majority of
which reside in Canada). Bear Island Paper Company, L.L.C., is a
U.S.-based unit of White Birch.
Bear Island filed a voluntary petition for relief under Chapter 11
of the Bankruptcy Code (Bankr. E.D. Va. Case No. 10-31202) on
Feb. 24, 2010. At June 30, 2011, the Company had
$141.9 million in total assets, $153.2 million in total
liabilities, and a stockholders' deficit of $11.3 million.
White Birch filed for bankruptcy protection under Canada's
Companies' Creditors Arrangement Act, before the Superior Court
for the Province of Quebec, Commercial Division, Judicial District
of Montreal, Canada. White Birch and five other affiliates --
F.F. Soucy Limited Partnership; F.F. Soucy, Inc. & Partners,
Limited Partnership; Papier Masson Ltee; Stadacona Limited
Partnership; and Stadacona General Partner, Inc. -- also sought
bankruptcy protection under Chapter 15 of the U.S. Bankruptcy Code
(Bankr. E.D. Va. Case No. 10-31234).
Jonathan L. Hauser, Esq., at Troutman Sanders LLP, in Virginia
Beach, Virginia; and Richard M. Cieri, Esq., Christopher J.
Marcus, Esq., and Michael A. Cohen, Esq., at Kirkland & Ellis LLP,
in New York, serve as counsel to White Birch, as Foreign
Representative. Kirkland & Ellis and Troutman Sanders also serve
as Chapter 11 counsel to Bear Island. AlixPartners LLP serves as
financial and restructuring advisors to Bear Island, and Lazard
Freres & Co., serves as investment banker. Garden City Group is
the claims and notice agent. Jason William Harbour, Esq., at
Hunton & Williams LLP, in Richmond, Virginia, represents the
Official Committee of Unsecured Creditors. Chief Judge Douglas O.
Tice, Jr., handles the Chapter 11 and Chapter 15 cases.
As reported in the TCR on Oct. 10, 2011, the Debtor won bankruptcy
court approval to seek votes on its amended liquidation plan.
The confirmation hearing is scheduled for Nov. 22, at 2:00 p.m.
The deadline to file an objection to the confirmation of the Plan
and to vote to accept or reject the Plan is on Nov. 14.
BERNARD L. MADOFF: Appeal of $1-Bil. Settlement Up for Dismissal
----------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the trustee for Bernard L. Madoff Investment
Securities Inc. is standing shoulder to shoulder with Tremont
Group Holdings Inc. in telling a U.S. District Judge that an
appeal should be dismissed from an order of the bankruptcy court
settling a lawsuit by the Madoff trustee against Tremont,
Oppenheimer Acquisition Corp., Massachusetts Mutual Life Insurance
Co. and affiliates. Oppenheimer owns the Tremont hedge fund.
According to the report, the trustee's complaint, unsealed in
March, was seeking to recover about $2.1 billion that the funds
received directly from the Madoff firm. The settlement authorized
the trustee to recover $1.025 billion cash from the second-largest
group of feeder funds that funneled money into the Madoff Ponzi
scheme. In return for the $1.025 billion payment into escrow, the
foreign and domestic investment funds will receive about
$3 billion in approved customer claims. The settlement was
structured so distributions on the funds' claims will be paid
directly to the funds' customers.
Mr. Rochelle relates that investors in other Tremont funds
appealed the settlement. Their funds were so-called net winners
which managed to take more out of the Madoff firm than they
invested. Consequently, they don't have customer claims against
the Madoff firm under a ruling in August by the U.S. Court of
Appeals. In the appeal, they want the settlement set aside so
they too can have claims against the Madoff firm.
According to Mr. Rochelle, the trustee, Tremont, and Mass Mutual
all joined together requesting dismissal of the appeal. They
argue that the appealing customers aren't creditors of the Madoff
firm, aren't aggrieved by the settlement and thus lack standing,
or the right to appeal. U.S. District Judge George B. Daniels
will decide whether the appeal should be dismissed.
About Bernard L. Madoff
Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff
orchestrated the largest Ponzi scheme in history, with losses
topping US$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 US$6.88 billion in claims by
investors has been allowed, with US$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.
BLOSSMAN BANCSHARES: Files for Bankruptcy to Sell Bank to NBC
-------------------------------------------------------------
Rebecca Mowbray at the Times-Picayune reports that Blossman
Bancshares Inc. filed for Chapter 11 bankruptcy reorganization on
Oct. 26, 2011, as the Northshore holding company seeks to sell its
troubled Central Progressive Bank to First NBC Bank Holding Co.
According to the report, federal regulators have threatened to
shut down Central Progressive next month if it hasn't found a
buyer. The report also notes a real estate lawsuit in Mississippi
seeks $50 million in damages, charging that former bank management
committed fraud and unjustly enriched the bank.
The report notes Brandon Faciane, Central Progressive's president
and chief executive, stated in an Oct. 17 affidavit in the
Mississippi lawsuit that his bank has been notified that the
Federal Deposit Insurance Corp. will shut down the bank as soon as
November if the sale is not completed.
Times-Picayune reports that on Oct. 27, 2011, Mr. Faciane said
that Central Progressive remains open for business, and customer
deposits are protected by the Federal Deposit Insurance Corp.
The report relates that Central Progressive Bank got in trouble
several years ago when improper management practices conspired
with the economic and real estate downturn. The bank has been the
subject of several orders by regulators in recent years, and its
former chairman, chief executive and director Richard S. "Dickie"
Blossman Jr. was fined and banned from the banking business
because of his reckless disregard of bank rules.
Times-Picayune relates that New Orleans-based First NBC struck a
deal in September to buy the bank through a series of transactions
designed to insulate it from Central Progressive's bad loans, but
few details have been available about the transaction. The
agreement was revealed in a legal notice the bank was required to
make as a part of its filing with bank regulators, and First NBC
has declined to comment on the deal.
The report says U.S. Bank, Wells Fargo Delaware Trust and
Wilmington Trust Co., for example, serve as agents for various
Central Progressive trusts and hold about $23.4 million in
unsecured debt in Blossman Bancshares.
Times-Picayune relates that Robin Cheatham, Esq. --
robin.cheatham@arlaw.com -- a bankruptcy attorney at Adams &
Reese, who is representing Blossman Bancshares, said that the
bankruptcy filing will allow Central Progressive to be transferred
to First NBC and continue operating unencumbered by liens or
claims. Selling Central Progressive outside of bankruptcy would
require creditor and shareholder approval.
Under the terms described in bankruptcy court, First NBC would buy
all of Blossman Bancshares' stock in Central Progressive for
$900,000, paying $400,000 at closing and an additional $500,000
three years later -- if the bank's assets perform at certain
benchmarks, notes Times-Picayune.
According to the report, Central Progressive has $384 million in
assets and operates 17 bank offices on the Northshore. Those
locations will become First NBC branches after the deal closes,
more than doubling the branch network of the New Orleans bank and
getting it into a new geographic territory.
The report relates that First NBC's $900,000 deal would serve as
the opening bid in an auction proposed for Nov. 14, 2011; minimum
rival bids must be at least $1.325 million. Other prospective
bidders must submit financial statements, a cashier's check for
$50,000 as a deposit and a proposed stock purchase agreement that
is better than First NBC's offer by Nov. 11, 2011.
The report notes if no qualified bidder makes a better offer, the
auction is canceled, and the Nov. 14 court date will become a
hearing to approve the proposed sale of Central Progressive's
stock to First NBC.
U.S. Bankruptcy Judge Jerry Brown, who has been assigned to the
case, still must sign off on the auction plan. Objections are due
Nov. 1, 2011, and a hearing on the auction procedures is set for
Nov. 2, 2011. Any sale of Central Progressive is subject to
approval by federal and state banking regulators, but the Blossman
bankruptcy filing says the company has kept regulators informed
while creating its plan.
First NBC seeks to close the deal to buy Central Progressive by
Nov. 30, 2011.
Based in Lacombe, Louisiana, Blossman Bancshares Inc. is a
registered bank holding company with financial holding company
status that owns and controls Central Progressive Bank, a state
chartered nonmember bank, and various nonbank subsidiaries.
BURNSVILLE LAND: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Burnsville Land Company, LLC
4114 Woodlands Pkwy., Suite 402
Palm Harbor, FL 34685
Bankruptcy Case No.: 11-11025
Chapter 11 Petition Date: October 24, 2011
Court: United States Bankruptcy Court
Western District of North Carolina (Asheville)
Judge: George R. Hodges
Debtor's Counsel: Edward C. Hay, Jr., Esq.
PITTS, HAY & HUGENSCHMIDT, P.A.
137 Biltmore Avenue
Asheville, NC 28801
Tel: (828) 255-8085
Fax: (828) 251-2760
E-mail: ehay@phhlawfirm.com
Scheduled Assets: $6,668,000
Scheduled Debts: $4,872,509
The Debtor did not file a list of its largest unsecured creditors
together with its petition.
The petition was signed by Stephen R. Hand, manager of Amy's
Mountain, LLC.
C F SPORTS: Case Summary & 7 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: C F Sports Medicine, LLC
6019 Oleander Dr Suite 200
Wilmington, NC 28403
Bankruptcy Case No.: 11-08084
Chapter 11 Petition Date: October 24, 2011
Court: United States Bankruptcy Court
Eastern District of North Carolina (Wilson)
Judge: Stephani W. Humrickhouse
Debtor's Counsel: Trawick H Stubbs, Jr., Esq.
STUBBS & PERDUE, P.A.
P.O. Drawer 1654
New Bern, NC 28563
Tel: (252) 633-2700
Fax: (252) 633-9600
E-mail: efile@stubbsperdue.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's seven largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/nceb11-08084.pdf
The petition was signed by Dale W. Boyd, Jr., member/manager.
CAFE FUNCHAL: Works With Millennium bcpbank to Restructure Debt
---------------------------------------------------------------
Dan McDonald at SouthCoastTODAY.com reports Cafe Funchal said it
is restructuring its mortgage with Millennium bcpbank of Newark,
New Jersey. The Company's Chapter 11 case was dismissed Oct. 5,
2011.
Mr. McDonald relates that Duarte DaSilva, the restaurant's owner,
said on Oct. 25, 2011, Cafe Funchal would not be liquidated, shut
down or change ownership. Cafe Funchal will continue to be owned
and operated by his family, adds Mr. Silva.
The report relates that Mr. DaSilva said the restaurant is
"completely out of bankruptcy proceedings" and that the case was
never converted to Chapter 7, which is usually reserved for
liquidation.
Based in New Bedford, Massachusetts, Cafe Funchal Inc. is located
at 123 Church Street. The Company filed for Chapter 11 protection
(Bankr. D. Mass. Case No. 11-12239) on March 18, 2011. Judge
William C. Hillman presides over the case. David B. Madoff, Esq.,
at Madoff & Khoury LLP, represents the Debtor. The Debtor listed
assets of $331,336 and liabilities of $3,846,760.
CAREFREE WILLOWS: Wants Prelim. Injunction Against AG/ICC Willows
-----------------------------------------------------------------
Carefree Willows, LLC, asks the U.S. Bankruptcy Court for the
District of Nevada for a protective order and notifies that it
joins in the guarantor's motion for protective order.
The Debtor relates that the injunction motion seeks to enjoin
AG/ICC Willows Loan Owner, LLC, a Delaware limited liability
company, from proceeding with the civil lawsuit against Carefree
Holdings Limited Partnership, a Nevada limited partnership;
Templeton Family Trust Dated Oct. 8, 1993; Ken II Trust Dated
May 4, 1998; Kenneth L. Templeton, an individual; and MLPGP,
L.L.C., a Nevada limited liability company. The Debtor has sought
the injunction with respect to the documents that it is requested
to produce. The Debtor says that the injunction will assure that
the guarantors are able to fund the Debtor's Plan. The Debtor
seeks a preliminary injunction only for the period of time up to
plan confirmation.
The Debtor notes that the Guaranty Lawsuit seeks to collect from
the guarantors the full amount of the loan that was purchased by
AG shortly after this bankruptcy case was filed. The Debtor has
proposed its Second Amended Plan of Reorganization, which provides
that the obligation owed to AG will be repaid in full by
restructuring a secured debt in an amount equal to the agreed upon
value of the property, plus payment in cash for the entire balance
owed on the AG claim. The Guarantors have collectively agreed to
fund the Debtor's Plan, which will require a cash infusion
estimated at $2,700,000 to $7,546,000.
About Carefree Willows LLC
Carefree Willows, LLC, is the owner of an existing 300-unit senior
housing complex, located 3250 S. Town Center Drive, in Las Vegas.
Nevada. Carefree Willows filed a Chapter 11 petition (Bankr. D.
Nev. Case No. 10-29932) on Oct. 22, 2010. Alan R. Smith, Esq., at
the Law Offices of Alan R. Smith, in Reno, Nevada, serves as
counsel to the Debtor. The Debtor disclosed $30,604,014 in assets
and $36,531,244 in liabilities as of the Chapter 11 filing.
CASCADE GLADES: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Cascade Glades, LLC
3455 Peachtree Rd., Suite 500
Atlanta, GA 30326
Bankruptcy Case No.: 11-80519
Chapter 11 Petition Date:
Court: United States Bankruptcy Court
Northern District of Georgia (Atlanta)
Debtor's Counsel: John A. Moore, Esq.
THE MOORE LAW GROUP, LLC
1745 Martin Luther King Jr. Dr.
Atlanta, GA 30314
Tel: (678) 288-5600
Fax: (888) 553-0071
E-mail: jmoore@moorelawllc.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor did not file a list of its largest unsecured creditors
together with its petition.
The petition was signed by Alvin Love, II, member.
CHRYSLER LLC: Consumer Warranty Claims Barred by Sale Order
-----------------------------------------------------------
Bankruptcy Judge Arthur J. Gonzalez dismissed a consumer lawsuit
filed against Chrysler Group LLC, the purchaser of substantially
all of the assets of Old Carco LLC, f/k/a Chrysler LLC, and its
affiliated debtors. The Plaintiff asserts several claims against
Chrysler Group under California's Song-Beverly Consumer Warranty
Act, Cal. Civ. Code Sec. 1790, et seq., based upon a failure to
repair certain alleged defects in the Plaintiff's 2003 Dodge
vehicle which was manufactured by the Debtors and purchased as a
"used" vehicle by the Plaintiff in 2006. Chrysler Group seeks
dismissal of the Amended Complaint, arguing that the Plaintiff's
claims are barred by the Court's June 1, 2009 order approving the
sale of substantially all of the Debtors' assets to Chrysler
Group, free and clear of all claims other than liabilities
expressly assumed by the Chrysler Group, pursuant to 11 U.S.C.
Section 363. The Sale Order authorized the Debtors to enter into
a Master Transaction Agreement, dated April 30, 2009, with the
Chrysler Group. The closing of the sale of the Debtors' assets to
the Chrysler Group was on June 10, 2009. Judge Gonzalez agrees
with Chrysler Group that the Plaintiff's claims are barred by the
Sale Order. A copy of Judge Gonzalez's Oct. 28, 2011 Opinion is
available at http://is.gd/7OXQsnfrom Leagle.com. The lawsuit is
Daniel Tulacro, v. Chrysler Group LLC, et al., Adv. Proc. No.
11-09401 (Bankr. S.D.N.Y.).
About Chrysler
Chrysler Group LLC, formed in 2009 from a global strategic
alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Ram
Truck, Mopar(R) and Global Electric Motorcars (GEM) brand vehicles
and products. Headquartered in Auburn Hills, Michigan, Chrysler
Group's product lineup features some of the world's most
recognizable vehicles, including the Chrysler 300, Jeep Wrangler
and Ram Truck.
Chrysler LLC and 24 affiliates sought Chapter 11 protection from
creditors (Bankr. S.D.N.Y (Mega-case), Lead Case No. 09-50002) on
April 30, 2009. Chrysler hired Jones Day, as lead counsel; Togut
Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group
LLC, and Greenhill & Co. LLC, for financial advisory services;
and Epiq Bankruptcy Solutions LLC, as its claims agent. As of
Dec. 31, 2008, Chrysler had $39,336,000,000 in assets and
$55,233,000,000 in debts. Chrysler had $1.9 billion in cash at
that time.
In connection with the bankruptcy filing, Chrysler reached an
agreement with Italian automobile manufacturer Fiat SpA, the U.S.
and Canadian governments and other key constituents regarding a
transaction under 11 U.S.C. Section 363 that would effect an
alliance between Chrysler and Fiat. As part of the deal, Fiat
acquired a 20% equity interest in the newly formed Chrysler Group
LLC. Chrysler changed its corporate name to Old CarCo following
the sale.
The U.S. and Canadian governments provided Chrysler with
$4.5 billion to finance its bankruptcy case. Those loans were
repaid with the proceeds of the bankruptcy estate's liquidation.
In April 2010, the Bankruptcy Court confirmed Chrysler's repayment
plan.
Post-bankruptcy, Fiat has since raised its stake to 53.5% after
snapping up the U.S. government's remaining interest in July 2011.
CLAUDIO OSORIO: Miami Home Subject to November 3 Auction
-------------------------------------------------------- Janie
Campbell and Hank Tester at NBC Miami report that Claudio and
Amarilis Osorio's 8,699-square foot home in Miami, Florida will be
sold Nov. 3, 2011, at an auction.
The report notes experts expect the sale will fetch a price beyond
the bidding start of $10.5 million.
According to the report, the Osorios are facing at least five
lawsuits, according to the Miami Herald, including those by NBA
star Carlos Boozer, Miami developer and lawyer Chris Korge, and
New York City developer Ryan Freedman.
About InnoVida and Osorio
Receiver Mark S. Meland, at Meland Russin & Budwick, PA, filed a
Chapter 11 petition for InnoVida Holdings, LLC, fdba COEG, LLC
(Bankr. S.D. Fla. Case No. 11-17702) on March 24, 2011. Separate
Chapter 11 petitions were filed for these affiliates: InnoVida
MRD, LLC (Case No. 11-17704), InnoVida Services, Inc. (Case No.
11-17705), and InnoVida Southeast, LLC (Case No. 11-17706). Peter
D. Russin, Esq., at Meland Russin & Budwick, P.A., serves as
bankruptcy counsel. InnoVida Holdings has under $50,000 in assets
and $10 million to $50 million in debts, according to the
petition.
Founder Claudio Eleazar and Amarilis Osorio filed a separate
Chapter 11 petition (Bankr. S.D. Fla. Case No. 11-17075) on
March 17, 2011. Mr. Osorios is being accused of fraud and
mismanagement.
Bankruptcy Judge Robert A. Mark in Miami authorized the
appointment of Mark S. Meland as trustee for InnoVida.
Mr. Meland, who had been serving as a receiver for the business in
the wake of the allegations against Mr. Osorio, was the one who
ushered InnoVida into bankruptcy.
COLFAX CORP: Moody's Assigns 'Ba3' Corporate Family Rating
----------------------------------------------------------
Moody's Investors Service assigns Ba3 Corporate Family and
Probability of Default Ratings to Colfax Corporation ("Colfax")
and Ba2 rating to the company's proposed $300 million senior
secured revolving credit facilities and $1.8 billion term loans.
Proceeds from the proposed $2.1 billion financing will be used to
partially fund the acquisition of Charter International PLC. The
rating outlook is stable.
RATINGS RATIONALE
The Ba3 rating incorporates the high initial pro forma leverage
following the acquisition of approximately 5 times adjusted for
operating leases, pension liabilities, and asbestos liabilities,
with the expectation that the level will be reduced in the near
term as synergies are realized and business practices are
optimized. The rating recognizes the challenges of absorbing the
much larger Charter into Colfax but Moody's believes that the
management structure and investor base combined with strong global
product platforms of the two companies minimizes the risk.
These ratings have been assigned:
Colfax Corporation
Corporate Family Rating Ba3
Probability of Default Rating Ba3
$100M Revolver due 2016-US Ba2, LGD3 -30%
$200M Term Loan A due 2016-US Ba2, LGD3 -30%
$900M Term Loan B due 2018-US Ba2, LGD3 -30%
Speculative grade liquidity rating SGL-3
Outlook: Stable
Colfax UK Holdings Ltd
$700M Term Loan A due 2016-UK Ba2, LGD3 -30%
Colfax Corp/Colfax UK Holdings Ltd
$200M Revolver due 2016-UK Ba2, LGD3 -30%
The Ba2 rating on Colfax Corporation's senior secured credit
facility is one notch above the corporate family rating due to the
junior capital in the form of various unsecured obligations
including pension liabilities and trade claims. The revolver, term
loan A and term loan B are secured by the same collateral pool and
therefore are at the same rating level.
Colfax Corporation's SGL-3 Speculative Grade Liquidity rating
reflects Moody's expectations that the company will maintain
adequate liquidity over the next twelve months. The liquidity
profile is supported by initial cash balances of over $170 million
of which about $70 million is restricted, $300 million of revolver
availability, and the expectation of positive free cash flow
generation with minimal amortization requirements over the near
term.
What could drive the ratings up
The ratings are not anticipated to experience positive ratings
action over the short term. However, were the company's leverage
to decrease to under 3.5 times and free cash flow available for
debt reduction anticipated at over 12% annually, positive ratings
traction could occur.
What could cause the ratings to go down
If the company does not make meaningful progress so that its year-
end 2012 leverage is anticipated to be under 4.25 times on a fully
adjusted basis, and deemed to be improving, the negative ratings
pressure could result in a change in outlook or a downgrade.
The principal methodology used in rating Colfax 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.
On September 12, 2011, Colfax Corporation announced its
acquisition of UK based, Charter International plc for $2.4
billion in cash and stock. The acquisition will create a $4.0
billion global diversified industrial company with operations in
80 countries. Pro-forma, the combined company's business segments
will include: welding (approximately 50%), Air and fluid handling
(25%), pumps, systems, valves and other (18%) and cutting and
automation (7%).
CONTESSA PREMIUM: Committee Dissatisfied with Plan Disclosures
--------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in the
Chapter 11 cases of Contessa Liquidating Co., Inc., f/k/a Contessa
Premium Foods, Inc., asks Judge Peter H. Carroll of the U.S.
Bankruptcy Court for the Central District of California, Los
Angeles Division, to deny approval of the disclosure statement
explaining the Chapter 11 plan of liquidation.
The Committee complains that the information contained in the
disclosures is inadequate in numerous material respects. The
Committee relates that although unsecured creditors are the only
parties whose votes are being solicited by the Debtor, the Debtor
did not engage the Committee in negotiations regarding its
proposed Plan until it provided a copy of the Plan and Disclosure
Statement to the Committee on Oct. 7.
The Debtor filed the liquidation plan and the accompanying
disclosure statement on Oct. 11. The Plan's objective is to
liquidate and distribute all of the Debtors' assets to holders of
allowed claims and allowed unclassified claims.
General unsecured claims, totaling $8,406,664, will be treated in
one of two ways. Holders of general unsecured claims who
affirmatively elect to be treated as such will be paid in cash
equivalent to 70% of their allowed claim. The Debtor will waive
all causes of action that may exist against the claimholder.
Holders of general unsecured claims that do not vote for or
against the plan, is deemed to have rejected the Plan, or has
rejected the Plan will remain subject to the disputed claim
process and causes of action may exist against those claimholders.
Ballots to accept or reject the Plan must be received by Dec. 7,
2011.
The Committee specifically complains that the discussion of the
Debtor's post-confirmation management is inadequate. The
Committee asserts that information regarding the future management
of the debtor should also include the amount of compensation to be
paid to any insiders, directors, and/or officers of the debtor.
The Plan is a liquidating plan that proposes to cancel equity
interests in the Debtor and to liquidate and distribute all of the
Debtor?s assets to holders of allowed claims. The Committee notes
that rather than create a creditors? trust to implement the
liquidation under the supervision of an independent trustee, the
Plan proposes, with little explanation, that "the Reorganized
Debtor" will be given the responsibility for winding up its
affairs, liquidating, prosecuting causes of action, resolving
claims, and administering the Plan. The Committee believes this
structure is inappropriate and is inconsistent with the interests
of creditors and public policy.
A full-text copy of the Plan, dated Oct. 11, is available for free
at http://ResearchArchives.com/t/s?773c
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.
Contessa Premium filed for Chapter 11 bankruptcy protection
(Bankr. C.D. Calif. Case No. 11-13454) on Jan. 26, 2011. Craig A.
Wolfe, Esq., and Jason R. Alderson, Esq., at Kelley Drye & Warren
LLP, in New York, represent 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.
CROWN CASTLE: Fitch Affirms Issuer Default Ratings at 'BB'
----------------------------------------------------------
Fitch Ratings has affirmed the Issuer Default Ratings (IDR) of
Crown Castle International Corp. (CCIC) and its subsidiaries at
'BB'. In addition, long-term debt ratings at CCIC and its
subsidiaries have been affirmed.
Fitch has affirmed the following ratings:
CCIC
-- IDR at 'BB';
-- Senior Unsecured Debt at 'BB-'.
Crown Castle Operating Company (CCOC)
-- IDR at 'BB';
-- Senior Secured Credit Facility at 'BB+'.
CC Holdings GS V LLC (GS V)
-- IDR at 'BB';
-- Senior Secured Notes at 'BBB-'.
The Rating Outlook for CCIC and its subsidiaries is Stable.
Crown's ratings are supported by the strong recurring cash flows
generated from its leasing operations, the robust EBITDA margin
that should continue to increase through new lease-up
opportunities, and the scale of its tower portfolio. Crown's
long-term growth strategy of primarily focusing on the U.S. market
versus seeking growth internationally in emerging markets also
reduces operating risk. These factors lend considerable stability
to cash flows and lead to a lower business risk profile than most
typical corporate credits.
A key factor in future revenue and cash flow growth for Crown, as
well as the rest of the tower industry, is the growth within
mobile broadband services. Growth in 4G services will drive
amendment activity and new lease-up revenues from the major
operators leading to mid-single digit growth prospects for the
next couple of years.
This growth along with lease escalator adjustments will more than
offset the increase in churn pressure from the consolidation of
networks (Alltel, Sprint, potentially T-Mobile) during the next
several years. Fitch expects the increased churn pressure will be
distributed over a multiyear period. Sprint related churn from
iDEN decommissioning should be spread primarily over a four year
period which is the average length for remaining leases. Crown
has indicated iDEN related revenue loss could be approximately 2-
3% of site rental revenue.
Annualized leverage (debt to EBITDA) as of the third quarter of
2011 was 5.2 times (x). This is consistent with Crown's net
leverage target of 5x. Fitch expects Crown will increase absolute
debt levels consistent with growth in cash flows to keep leverage
in the 5x range for the next couple of years.
Longer-term in the 2015 - 2016 timeframe, Crown has indicated a
potential for a REIT conversion. As such, Crown may consider
lowering its future leverage target range similar to that of
American Tower. Fitch expects American Tower will maintain net
leverage in the 3.5 to 4.0x range. Consequently, any further
rating upgrades would require Crown to lower its leverage target.
Crown maintains significant flexibility with prioritizing the use
of its liquidity and discretionary cash flow. For 2011, Crown
should exceed initial recurring cash flow (EBITDA less interest
less sustaining capital spend) estimates by approximately $45
million to approximately $775 million. In 2012, Crown has
indicated recurring cash flow will be in the range of $830 million
to $845 million, which Fitch believes Crown should at least meet
or exceed this target. Crown estimates discretionary spending
capacity of approximately $1.2 billion when factoring in
additional debt capacity due to cash flow growth.
Crown expects to spend approximately $300 million in capital
expenditures in 2012 including approximately $150 million for land
purchases. The focus on buying or extending its land leases
benefits the longer-term credit profile by increasing margin
certainty and decreasing its leasing obligation. Fitch accounts
for operating leases within its adjusted debt metrics. The
remaining $900 million of discretionary spending could be
available for acquisitions or share repurchases. Fitch believes
this is consistent with current rating expectations. Common stock
and preferred stock repurchases totaled $316 million for the first
three quarters of 2011.
As of the third quarter 2011, cash was $76 million. Crown had
drawn down $305 million of its $450 million revolving facility
that matures in 2013. The company has significant flexibility
under its covenants. Fitch expects that Crown could seek to term
out the debt on its facility to free up additional liquidity.
Crown does not have any significant maturities until early 2014
when the $622 million term loan matures.
The 'BBB-' rating for the secured debt at GS V reflects the
superior recovery and over-collateralization of the debt at the
operating company level. The ratings for the secured credit
facility at CCOC reflect the lower collateral support from its
pledged assets as well as expected benefits from the over-
collateralization of the secured assets at Towers LLC, GS V and
Global Signal Holdings III LLC. The ratings of the unsecured debt
at the holding company level reflect the structural subordination.
The distinction in rating differences between Fitch's existing
structured and corporate debt ratings reflects the structural
enhancements with the CMBS issuances including the protection of
interest payments during a bankruptcy process.
Longer-term, Fitch believes Crown's ratings have upward potential
from further operational and credit profile improvements. Key
rating drivers for Crown include (1) The stability and operating
leverage within its leasing operations; (2) Growth in broadband
data leading to increased lease-up opportunities; and (3)
Maintaining less aggressive financial policies than in the past.
CRYSTAL CATHEDRAL: Chapman University to Buy Assets Under Plan
--------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the Chapter 11 plan for Crystal Cathedral Ministries,
proposed by the official creditors' committee, is to be financed
by selling the facility for $51.5 million to Chapman University.
The confirmation hearing for approval of the plan will take place
Nov. 14.
Mr. Rochelle relates that the Committee's plan gave the megachurch
in Garden Grove, California, the right to select the buyer, so
long as the offer was acceptable to the creditors' panel. After
bidding against Roman Catholic Bishop of Orange County,
California, Chapman made the offer selected by the church.
Chapman is allowing the church to lease back specified church
properties for 15 years at $150,000 a month. In addition, the
church can pay another $65,000 a month for a two-year lease on
facilities used for a school.
According to the report, the church will have a five-year option
of buying back the church buildings for $30 million, with some
credit given for rent paid in the meantime. The plan pays secured
creditors first, with the remainder going to unsecured creditors
who would receive interest on their $12.5 million in claims. The
plan was approved by all classes that voted on the plan, except
insiders who voted "no." Insiders, with $2 million in claims,
would be paid after unsecured creditors are paid, with interest.
Mr. Rochelle notes that if insiders don't accept the plan, the
Committee intends to seek court-ordered subordination of the
insiders' claims. The committee believes subordination is proper
because insiders continued paying large compensation to members of
the family of retired minister Robert H. Schuller even though
contributions had fallen and creditors weren't being paid.
Board Endorses Offer
Deepa Bharath of the Orange County Register reports that Crystal
Cathedral Ministries' board of directors has endorsed Chapman
University's proposal to buy the 40-acre church campus for
$50 million.
The report notes Chapman University and the Roman Catholic Diocese
of Orange, which offered $53.6 million in cash, were the top
bidders for the financially ailing cathedral.
According to the report, senior pastor Sheila Schuller Coleman,
daughter of Crystal Cathedral founder Robert H. Schuller, stated
that the board "had to reluctantly vote to accept a plan due to
deadlines required by the court."
"Nothing is final until November 14!" the report quotes Pastor
Coleman as saying.
Ms. Bharath says Chapman will be named as the formal buyer in
bankruptcy court. A final confirmation hearing to formalize the
sale has been set for Nov. 14.
Chapman University President James L. Doti said Oct. 26, 2011,
that he was not surprised by the board's decision.
The report says the diocese's proposal also offered the cathedral
the opportunity to consider its ministry at a new location. Alan
H. Martin, an attorney representing the diocese, said he is
hopeful that the court will weigh the various options and make the
best decision.
The report relates that the offer from the diocese calls for an
immediate deposit of $250,000 and a secondary payment of $750,000.
The diocese also offers to help Crystal Cathedral Ministries phase
out its operations by offering a three-year leaseback plan for
some of the buildings on campus including the four-story Family
Life Center. In addition, the diocese offered the cathedral an
alternative worship space at 90% of the fair market value for 15
years. The cathedral had the option to buy the same property at
90% of the fair market value within five years.
About Crystal Cathedral
Crystal Cathedral Ministries is a Southern California-based
megachurch founded by television evangelist Robert Schuller. The
church, known for its television show "The Hour of Power."
Mr. Schuller retired from his role as senior pastor of Crystal
Cathedral in 2006. His daughter Sheila Schuller Coleman has been
senior pastor since July 2009. Contributions declined 24% in
2009, in part on account of "unsettled leadership."
Crystal Cathedral filed for Chapter 11 bankruptcy protection
(Bankr. C.D. Calif. 10-24771) on Oct. 18, 2010. The Debtor
disclosed $72,872,165 in assets and $48,460,826 in liabilities as
of the Chapter 11 filing. Marc J. Winthrop, Esq., at Winthrop
Couchot P.C. represent the Debtor. Todd C. Ringstad, Esq., at
Ringstad & Sanders, LLP, represents the Official Committee of
Unsecured Creditors.
DETROIT COMMUNITY: S&P Cuts Rating on Series 2005 Bonds to 'B+'
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term rating to
'B+' from 'BB+' on Detroit Community Schools (DCS), Mich.'s series
2005 public school academy revenue bonds and placed the rating on
CreditWatch with negative implications.
"The lowered rating reflects our view of the academy's poor
academic performance and management turnover that, according to
Saginaw Valley State University, the academy's authorizer, has
resulted in corrective action and puts the charter at risk for
non-renewal," said Standard & Poor's credit analyst Shari Sikes.
"The CreditWatch is an indication of the specific risk associated
with the potential closure or restructuring of the school in June
2012, as indicated by the authorizer," Ms. Sikes added.
The school's major capital needs have been met, so management has
no immediate, long-term debt plans.
DLH MASTER: Hearing on Allen and RSAI Plan Outline Set for Nov. 17
------------------------------------------------------------------
Richard Allen and Richard S. Allen, Inc., filed on Oct. 21, 2011,
a disclosure statement explaining their first amended joint plan
of reorganization. The hearing to consider the adequacy of the
disclosure statement will be held on Nov. 17, 2011, at 1:30 p.m.
Allen and RSAI's bankruptcy cases became necessary due to the
filing of the bankruptcy cases of Allen Capital Partners, LLC
("ACP") and DLH Master Land Holding, LLC ("DLH") and the fact that
Allen and RSAI signed personal guarantees that guaranteed
approximately $150 million of the debts of DLH, ACP and ACP
subsidiaries. In addition, certain unsecured creditors of DLH and
ACP had brought and others had threatened to bring lawsuits
against Allen and RSAI in an effort to attach assets and jump
ahead of other unsecured creditors of Allen and RSAI.
The Plan provides that the assets of the Debtors will revest in
the Debtors on the Effective Date, free and clear of all Claims
except as provided under the Plan. The Plan, in conjunction with
the Plan of ACP and DLH, seeks to maximize the value of the
Debtors' assets by selling assets in an orderly fashion and
realizing the value of Allen and RSAI's Interests in DLH and ACP
over time in order to pay all creditors of Allen and RSAI in full.
The Debtors project to pay all Holders of Claims against Allen and
RSAI in full over time, with interest to the extent required by
the Bankruptcy Code or other applicable law.
Allen's Plan provides for all Secured Creditors to be paid in full
over a reasonable time period.
RSAI has only two Secured Creditors, Foley and Pacific Western
Bank. They will retain their liens on the same Collateral they
had pre-bankruptcy. In the case of Foley, he will be paid
from RSAI Net Cash Flow received from BF Airport Partners, an
entity that owns land adjacent to the airport in Bakersfield,
California, and Allen Industrial, which owns an industrial
building in Visalia, California.
Pacific Western Bank will receive, in addition to the payments
under the ACP Plan, Pacific Western Bank quarterly payments from
RSAI Net Cash Flow from sources other than BF Airport Partners and
Allen Industrial upon which Foley has a superior prior lien. RSAI
cash flow projections project that Pacific Western Bank will be
paid in full within three years of the Effective Date through
distributions of Net Cash Flow from RSAI and distributions under
the ACP Plan.
Holders of General Unsecured Claims against Allen and RSAI, which
includes Claims against Allen and RSAI with respect to guarantees
signed by Allen and RSAI, are projected to be paid in full within
8 years of the Effective Date from Allen and RSAI Net Cash Flow
and Equity Distributions from ACP and DLH.
Because all Holders of Claims are projected to be paid in full
over time, Allen is retaining his Interests in RSAI under the
Plan.
Classified Claims and Interests
Estimated Amount
----------------
Class 1A. Non-Tax Priority Claims (Allen) $0
Class 1B. Non-Tax Priority Claims (RSAI) $0
Class 2A. Secured Tax Claims (Allen) $0
Class 2B. Secured Tax Claims (RSAI) $0
Class 3A. Secured Claim Against Rancho Santa Fe
Residence (Allen) $4,098,204
Class 3B. Secured Claims Against Visalia Home
(Allen) $2,971,980
Class 3C. Secured Claims Against Tehama
Property (Allen) $3,884,466
Class 3D. Secured Claim Against Badger Property
(Allen) $425,000
Class 3E. Secured Claim Against Allen's
Interest in RSAI $100,000
Class 3F. Other Secured Claims Against Allen $0
Class 4A. Secured Claims Against RSAI's
Interests in BF Airport Partners and
Allen Industrial $7,312,186
Class 4B. Secured Claim Against Personal
Property, Goos, accounts and General
Intangibles of RSAI $1,402,045
Class 4C. Others Secured Claims Against RSAI $0
Class 5A. General Unsecured Claims Against
Allen $52,879,665
Class 5B. General Unsecured Claims Against
RSAI $3,878,170
Class 6. Allen Interests in RSAI
With the exception of Claims in Classes 1 and 6, all Classes are
impaired under the Plan.
A copy of the Disclosure Statement is available for free at:
http://bankrupt.com/misc/dlhmaster.allenandrsaiDS.dkt1211.pdf
About Allen Capital
Allen Capital Partners LLC and subsidiary DLH Master Land Holding
LLC, are the developers of Dallas Logistics Hub, a 6,000-acre
multimodal logistics park 12 miles (19 kilometers) from downtown
Dallas.
Allen Capital Partners, LLC, dba The Allen Group, filed for
Chapter 11 bankruptcy protection (Bankr. N.D. Tex. Case No. 10-
30562) on Jan. 25, 2010. Mark MacDonald, Esq., at MacDonald +
MacDonald, P.C., represents the Debtor. Lain, Faulkner & Co. is
the Debtor's financial advisor. The Company disclosed
$220,325,201 in assets and $160,622,236 in liabilities as of the
Chapter 11 filing.
The Debtor's affiliate -- DLH Master Land Holding, LLC, dba The
Allen Group -- filed a separate Chapter 11 bankruptcy petition.
Another affiliate, Visalia, California-based Richard S. Allen,
Inc., filed for Chapter 11 bankruptcy protection (Bankr. N.D.
Texas Case No. 10-33211) on May 3, 2010. Patrick J. Neligan, Jr.,
Esq., at Neligan Foley LLP, represents the Debtor. The Company
disclosed $76,158,469 in assets and $53,728,982 in liabilities as
of the petition date.
No trustee or examiner has been appointed in any of the cases
administratively consolidated with those of the Debtors.
There are two separate Chapter 11 plans filed in the Debtors'
Chapter 11 cases -- one filed by RSAI and Mr. Allen, and another
filed by DLH and Allen Capital Partners.
Debtors Allen and RSAI filed their original Joint Plan of
Reorganization on Aug. 18, 2010. However, after filing the
original Plan, due to delays and disputes related to the DLH and
ACP Plan, Allen and RSAI determined it was most efficient to wait
until the ACP and DLH Plan was confirmed before proceeding to
confirmation of the Allen and RSAI Plan.
As reported in the TCR on Oct. 17, 2011, an Amended Fifth Joint
Plan of Reorganization was filed for Allen Capital Partners LLC
and DLH Master Land Holding, but in an order dated Oct. 12, 2011,
Bankruptcy Judge Harlin D. Hale confirmed the Plan only as to ACP.
The Court will hold a further plan hearing as to DLH.
DUKE AND KING: Files Third Amended Joint Plan of Liquidation
------------------------------------------------------------
Duke and King Acquisition Corp., et al., and the Official
Committee of Unsecured Creditors in the Debtors' Chapter 11 cases
filed on Oct. 11, 2011, a third amended joint Chapter 11 Plan of
Liquidation for the resolution of the outstanding claims against
and interests in the Debtors' respective bankruptcy estates..
The Plan follows the closing of a sale of most of the Debtors'
operating assets to Strategic Restaurants Acquisition Company II,
LLC, Heartland Midwest, LLC, Cave Enterprises Operations, LLC, and
Crown Ventures Iowa, Inc., respectively, and contemplates the
liquidation of any unsold assets and distribution of the proceeds
pursuant to this Plan.
The Debtors estimate there to be between approximately $300,000
and $550,000 of Class 1 Allowed Secured Claims, which will receive
a 100% distribution. Class 1 is unimpaired.
The Debtors estimate there to be approximately $1,000 of Class 2
Allowed Other Priority Claims, which will receive a 100%
distribution. Class 2 is impaired.
Under the Third Amended Joint Plan, each Holder of a Class 3
Allowed General Unsecured Claim will receive a Pro Rata share of
the net proceeds of the Liquidating Trust Assets after the payment
of all Allowed Fee Claims, Allowed Administrative Claims, Allowed
Priority Tax Claims, Allowed Other Priority Claims and Allowed
Secured Claims, and the payment of all costs and expenses of the
Liquidating Trust.
The obligations to Holders of Allowed General Unsecured Claims
will be governed by the Liquidating Trust Agreement.
The Debtors estimate there to be approximately $6,000,000-
$7,500,000 of Allowed General Unsecured Claims, which will receive
a 19% to 38% distribution. Class 3 is impaired.
On the Effective Date, all Interests in the Debtors, except for
those in Duke Acquisition and Duke Missouri, will be deemed
automatically canceled, will be of not further force, whether
surrendered for cancellation or otherwise, and the obligations of
the Debtors thereunder or in any way related thereto will be
discharged. All Interests are not entitled to any distributions
under this Plan.
Holders of Class 4 Claims are conclusively deemed to have rejected
this Plan, and the votes of Holders of Class 4 Claims therefore
will not be solicited.
A copy of the Third Amended Joint Plan is available for free at:
http://bankrupt.com/misc/dukeandking.dkt464.pdf
About Duke and King
Burnsville, Minnesota-based Duke and King Acquisition Corp., dba
Burger King, was formed in November 2006, to acquire 88 Burger
King franchise restaurants from the Nath Companies. Duke and
King, together with affiliates, filed for Chapter 11 bankruptcy
protection (Bankr. D. Minn. Lead Case No. 10-38652) on Dec. 4,
2010. Duke and King estimated its assets and debts at $10 million
to $50 million.
Clinton E. Cutler, Esq., and Douglas W. Kassebaum, Esq., at
Fredrikson & Byron, P.A., serve as the Debtors' bankruptcy
counsel. Mastodon Ventures, Inc. acts as the Debtors' investment
banker. Maslon Edelman Borman & Brand, LLP serves as local
counsel and Aaron L. Hammer, Esq., and Richard S. Lauter, Esq., at
Freeborn & Peters LLP, in Chicago, is the bankruptcy counsel to
the Official Committee of Unsecured Creditors. Mesirow Financial
Consulting, LLC, serves as financial advisors of the Committee.
EREZ HEALTH: Court Accepts Valuation of Dover Woods Facility
------------------------------------------------------------
EREZ HEALTH CARE REALTY CO., L.L.C., v. TOWNSHIP OF TOMS RIVER,
Adv. Proc. No. 09-1738 (Bankr. D. N.J.), is a Complaint for the
Determination of Tax Liability Pursuant to 11 U.S.C. Sec. 505. In
Count One, Erez contests the Oct. 1, 2008 assessment and demands
judgment reducing the assessment to the "correct" market value.
In Count Two, Erez contests the assessment of the Property for the
years 2006 and 2007 and demands that the assessment be reduced.
Toms River filed a counterclaim seeking an increase in the
assessment of the Property. In its post-trial submissions, Erez
requests that its Complaint be amended to include the 2010 tax
year.
Erez presented the appraisal report of Gagliano & Company and the
testimony of Robert Gagliano. Toms River presented the appraisal
report of Henry J. Mancini & Associates and the testimony of Henry
Mancini. The parties stipulated to the admissibility of the
expert reports and the trial commended with the cross-examination
of the experts. Both experts concluded that the highest and best
use of the Property was its current use as a state licensed
residential healthcare facility. Despite that, the experts
reached widely divergent conclusions as to value. The chief
difference between the two expert reports was in the choice of
valuation method. The Gagliano report primarily relied on the
Income Capitalization Approach with values tested secondarily
against the Sales Comparison Approach. That method yielded values
from a low of $1.52 million (Oct. 1, 2006) to a high of $1.77
million (Oct. 1, 2008). The Mancini report primarily employed the
Cost Approach, which yielded values in the range of $4.7 million
(Oct. 1, 2009) to $5.4 million (Oct. 1, 2006).
In an Oct. 28, 2011 Memorandum Opinion, Bankruptcy Judge Kathryn
C. Ferguson adopts the valuations contained in the Gagliano report
for the years 2006 to 2010. Based on all of the evidence adduced
at trial, the Court concludes that the methodology employed in the
Gagliano report resulted in a more accurate determination of true
value. A copy of the decision is available at http://is.gd/4Ki27u
from Leagle.com.
Lakewood, New Jersey-based Erez Health Care Realty Co., L.L.C., is
a New Jersey limited liability corporation that owns the property
located at Lot 2, Block 159 on the official map of the Township of
Toms River, commonly known as 1001 Route 70, Dover Township, New
Jersey. The site is 4.44 acres and is improved with a 48,550
square foot building. The Property is used as residential health
care facility known as Dover Woods Residential Health Care
Facility. It is a state licensed facility with 236 beds, of which
200 are state-pay and 36 are private-pay.
Erez Health Care filed for Chapter 11 bankruptcy (Bankr. D. N.J.
Case No. 07-16649) on May 11, 2007. Judge Kathryn C. Ferguson
presides over the case. Andrew Kelly, Esq., at The Kelly Firm,
serves as the Debtor's counsel. In its petition, the Debtor
estimated $1 million to $100 million in assets and debts.
EVERGREEN SOLAR: Puts Midland Plant on Auction Block
----------------------------------------------------
Tony Lascari at Midland Daily News reported that Evergreen Solar's
plant in Midland, Massachusetts, goes on the bankruptcy auction
block.
According to the report, auctioneer Hilco Industrial is accepting
bids for Evergreen's buildings, cell and wafer fabrication
equipment, solar panels and more. A final bid-off was planned for
Nov. 1, 2011.
Mr. Lascari noted the U.S. government has stopped the sale of
solar panel manufacturing patents as part of the auction, citing
the need to prevent foreign entities for gaining control of the
federally-funded technology and unfairly competing with the
American solar industry.
About Evergreen Solar
Evergreen Solar, Inc. -- http://www.evergreensolar.com/--
develops, manufactures and markets String Ribbon solar power
products using its proprietary, low-cost silicon wafer technology.
The Company's patented wafer manufacturing technology uses
significantly less polysilicon than conventional processes.
Evergreen Solar's products provide reliable and environmentally
clean electric power for residential and commercial applications
globally.
The Marlboro, Mass.-based Company filed for Chapter 11 bankruptcy
(Bankr. D. Del. Case No. 11-12590) on Aug. 15, 2011, before Judge
Mary F. Walrath. The Company's balance sheet at April 2, 2011,
showed $373,972,000 in assets, $455,506,000 in total liabilities,
and a stockholders' deficit of $81,534,000.
Ronald J. Silverman, Esq., and Scott K. Seamon, Esq., at Bingham
McCutchen LLP, serve as general bankruptcy counsel to the Debtor.
Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski
Stang Ziehl & Jones LLP, serve as co-counsel. Hilco Industrial
LLC serves as exclusive marketing and sales agent. Klehr Harrison
Harvey Branzburg serves as special conflicts counsel. Zolfo
Cooper LLC is the financial advisor. UBS Securities, LLC, serves
as investment banker. Epiq Bankruptcy Solutions has been tapped
as claims agent.
In conjunction with the Chapter 11 filing, the Company entered
into a restructuring support agreement with certain holders of
more than 70% of the outstanding principal amount of the Company's
13% convertible senior secured notes. As part of the bankruptcy
process the Company will undertake a marketing process and will
permit all parties to bid on its assets, as a whole or in groups
pursuant to 11 U.S.C. Sec. 363. An entity formed by the
supporting noteholders, ES Purchaser, LLC, entered into an asset
purchase agreement with the Company to serve as a "stalking-horse"
and provide a "credit-bid" pursuant to the Bankruptcy Code for
assets being sold.
The supporting noteholders are represented by Michael S. Stainer,
Esq., and Natalie E. Levine, Esq., at Akin Gump Strauss Hauer &
Feld LLP, in New York.
An official committee of unsecured creditors has retained Pepper
Hamilton and Kramer Levin Naftalis & Frankel as counsel. The
Committee tapped Garden City Group as communications services
agent.
Evergreen Solar is at least the fourth solar company to seek court
protection from creditors since August 2011. Other solar firms
are start-up Spectrawatt Inc., which also filed in August,
Solyndra Inc., which filed early in September, and Stirling Energy
Systems Inc., which filed for Chapter 7 bankruptcy late in
September.
EVERGREEN SOLAR: Files Schedules of Assets and Liabilities
----------------------------------------------------------
Evergreen Solar, Inc., filed with the U.S. Bankruptcy Court for
the District of Delaware its schedules of assets and liabilities,
disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $200,888,821
B. Personal Property $751,161,932
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $172,150,000
E. Creditors Holding
Unsecured Priority
Claims $1,191,876
F. Creditors Holding
Unsecured Non-priority
Claims $231,259,807
----------- -----------
TOTAL $952,050,753 $404,601,683
About Evergreen Solar
Evergreen Solar, Inc. -- http://www.evergreensolar.com/--
develops, manufactures and markets String Ribbon solar power
products using its proprietary, low-cost silicon wafer technology.
The Company's patented wafer manufacturing technology uses
significantly less polysilicon than conventional processes.
Evergreen Solar's products provide reliable and environmentally
clean electric power for residential and commercial applications
globally.
The Marlboro, Mass.-based Company filed for Chapter 11 bankruptcy
(Bankr. D. Del. Case No. 11-12590) on Aug. 15, 2011, before Judge
Mary F. Walrath. The Company's balance sheet at April 2, 2011,
showed $373,972,000 in assets, $455,506,000 in total liabilities,
and a stockholders' deficit of $81,534,000.
Ronald J. Silverman, Esq., and Scott K. Seamon, Esq., at Bingham
McCutchen LLP, serve as general bankruptcy counsel to the Debtor.
Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski
Stang Ziehl & Jones LLP, serve as co-counsel. Zolfo Cooper LLC is
the financial advisor. Epiq Bankruptcy Solutions has been tapped
as claims agent.
In conjunction with the Chapter 11 filing, the Company entered
into a restructuring support agreement with certain holders of
more than 70% of the outstanding principal amount of the Company's
13% convertible senior secured notes. As part of the bankruptcy
process the Company will undertake a marketing process and will
permit all parties to bid on its assets, as a whole or in groups
pursuant to 11 U.S.C. Sec. 363. An entity formed by the
supporting noteholders, ES Purchaser, LLC, entered into an asset
purchase agreement with the Company to serve as a "stalking-horse"
and provide a "credit-bid" pursuant to the Bankruptcy Code for
assets being sold.
The supporting noteholders are represented by Michael S. Stainer,
Esq., and Natalie E. Levine, Esq., at Akin Gump Strauss Hauer &
Feld LLP, in New York.
FKF MADISON: Jones Lang Seeks Buyer; Bids Due Dec. 8
----------------------------------------------------
Citybiz Real Estate reports that Jones Lang LaSalle is soliciting
proposals to reorganize the debtors on One Madison Park in New
York City under Chapter 11 of the United States Bankruptcy Code.
The report notes the Jones Lang team includes Capital Markets'
Executive Vice President Joshua D. Gleiber.
According to the report, Jones Lang is presenting investors the
opportunity to submit proposals superior to the plan commitment
letter and term sheet already filed by the Debtors' largest
creditor, One Madison FM LLC.
The report notes competing bids are due no later than Dec. 8,
2011, at 5:00 p.m. (EST). Bidders whose bids are deemed
"qualified" will be invited to participate in an auction that
will be held on Dec. 13, 2011, at which time the winning bidder's
highest and best bid will be selected and subsequently presented
to the United States Bankruptcy Court for the District of
Delaware.
About FKF Madison
FKF Madison owns the One Madison Park condominium tower in New
York City. One Madison Park project came to halt in February 2010
when iStar Financial Inc., the chief financier for the project,
moved to foreclose on it. The high-profile condominium project, a
50-story tower was developed by Ira Shapiro and Marc Jacobs.
An involuntary Chapter 7 case (Bankr. D. Del. Case No. 10-11867)
was filed against FKF Madison on June 8, 2010. The case was
converted to a Chapter 11 in November 2010.
FOREST CITY: S&P Affirms 'B+' Corporate Credit Rating
-----------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Forest
City Enterprises Inc. to stable from negative and affirmed its
'B+' corporate credit rating on the company. "We also affirmed our
'B-' rating on Forest City's senior notes and our 'CCC+' rating
on Forest City's preferred stock. The rating actions affect
roughly $1.06 billion of rated debt securities and $220 million of
rated preferred stock," S&P said.
"The outlook revision reflects our view that the company's debt
coverage measures will modestly improve as in-development projects
within its portfolio come on line and begin to contribute cash
flow," said credit analyst Elizabeth Campbell.
"Our ratings on Forest City reflect a highly leveraged financial
risk profile with modestly improved, but still low, Standard &
Poor's-derived debt coverage measures (due to sizeable investments
in nonrevenue-generating development pursuits) and a fully
encumbered operating portfolio," S&P related.
The outlook is stable. Portfolio performance trends have been
positive for six consecutive quarters. Forest City has also
modestly deleveraged, leading to improved, albeit still slim,
fixed-charge coverage. "We believe that coverage measures will
continue to improve as development projects stabilize and begin
to contribute to cash flow over the next one-to-two years. If
Forest City improves its Standard & Poor's-derived fixed-charge
coverage measures comfortably above 1.3x, reduces leverage, and
limits the size, scope, and risk profile of future development, we
would consider raising the ratings. Alternatively, we would lower
the ratings if recent improvements in Standard & Poor's derived
fixed-charge coverage were to reverse course, if the company's
coverage covenant cushion deteriorates from its current level
(1.95x), and/or liquidity becomes constrained," S&P added.
FRESH HARVEST: Court Rules in Catahama v. Kerry Lawsuit
-------------------------------------------------------
CATAHAMA, LLC as assignee of FRESH HARVEST RIVER LLC, v. KERRY
INC. and THE KERRY GROUP PLC, No. 2:10-cv-1140 (W.D. Pa.), arises
out of a failed business venture. The original complaint and
first amended complaint asserted multiple claims against Kerry and
First Commonwealth Bank. In a June 24, 2011 Opinion, the Court
dismissed all claims against the Bank; dismissed all claims
against Kerry except for an alleged breach of Paragraph 7 of the
Letter of Intent; and gave the Plaintiff leave to file a second
amended complaint. The Plaintiff has done so, and has also filed
Notice of its intent to stand on the first amended complaint as to
the Bank. Kerry seeks dismissal of the Second Amended Complaint.
In the summer of 2008, the Bank foreclosed on its security
interest in a state-of-the-art food manufacturing facility and
equipment located in Dubois, Pennsylvania, and obtained title. To
preserve the value of its collateral, the Bank preferred to keep
the Facility occupied and operating. In March-April 2009, after
extensive negotiations, the Bank and FHR entered into a series of
agreements, including a mortgage, lines of credit and a temporary
lease. FHR continued to possess and operate the Facility while
further negotiations ensued. In October 2009, FHR was unable to
make a required $2,500,000 down payment because Abramson, the FHR
partner who was to supply the money, backed out. This problem
coincided with an unforeseen and historic economic downturn that
devastated the real estate market, consumer food demand and FHR's
business prospects. FHR advised the Bank of these developments,
and of its plan to locate new investors. The Bank and FHR agreed
to adjourn the closing indefinitely.
FHR remained in possession of the premises. By January 2010, FHR
had reached its credit limit and the Bank advised FHR that it was
unwilling to loan additional funds under the lines of credit. In
February 2010, FHR identified Catahama as a potential investor.
The Plaintiff alleges that Catahama was willing to provide working
capital and to fund customer orders, under certain conditions.
The Plaintiff alleges that in February 2010, aware that without
funding FHR would discontinue operations and the value of the
Bank's collateral would be reduced, the Bank agreed to Catahama's
conditions. Subsequently, FHR borrowed $2,162,375.15 from
Catahama.
In March 2010, Kerry contacted FHR to explore a co-packing
arrangement. FHR and Kerry entered into a Mutual Confidential
Information Agreement on March 5, 2010, in anticipation of a
customer/supplier relationship. Kerry personnel then visited the
Facility and obtained confidential and proprietary information
about FHR's business, methods and equipment, including the
production areas, the research lab and FHR personnel. Kerry was
impressed and pledged orders for 8,000,000 cases of product per
year. Kerry also developed an interest in purchasing the
Facility. On April 8, 2010, FHR and Kerry entered into a Letter
of Intent by which Kerry would acquire the Facility from FHR for
$22,000,000, subject to due diligence and other conditions. In
late April 2010, FHR asked the Bank how much it would cost to buy
the Facility and pay off the amounts borrowed under the lines of
credit. The Bank responded with a price of $18,600,000, although
it was unwilling to release Abramson from his personal guarantee.
On April 27, 2010, FHR informed the Bank that it was able to close
the transaction.
The Plaintiff alleges that sometime after entering into the LOI
with FHR but prior to mid-May 2010, Kerry disclosed the existence
of the LOI to the Bank. The Plaintiff further alleges that Kerry
entered into separate, direct negotiations with the Bank to
purchase the Facility. The Plaintiff alleges that during these
negotiations, Kerry misused confidential and proprietary
information it had obtained from FHR pursuant to the MCIA.
On May 6, 2010, the Bank sent FHR "formal notice" that it had
elected to terminate the Agreement of Sale. On May 18, 2010, the
Bank sent another letter to FHR to accelerate its Revolving Line
of Credit, based upon FHR's failure to cure the alleged defaults
set forth in the May 6 Termination Letter. On July 2, 2010, the
Bank entered into an agreement to sell the Facility to Kerry for
$20,000,000. On July 6, 2010, the Bank advised FHR of this
agreement and demanded that FHR quit the premises as of July 26,
2010. The Bank also sent letters to FHR customers, to demand that
they pay directly to the Bank all amounts due to FHR. FHR's
business failed and litigation began.
On Sept. 7, 2010, Kerry terminated its agreement to buy the
Facility from the Bank. On Sept. 12, 2010, FHR filed for
bankruptcy protection under Chapter 11. On Nov. 10, 2010, the
Bank executed its Writ of Possession and ejected FHR from the
Facility.
Only Counts Six through Eight of the Second Amended Complaint
remain at issue. In Count Six, the Plaintiff alleges that Kerry
breached the MCIA by exploiting the information it obtained to
negotiate a purchase of the Facility from the Bank. In Count
Seven, the Plaintiff alleges that Kerry breached the LOI or an
implied covenant of fair dealing by informing the Bank of the
existence of the LOI, in violation of Paragraph 6. In addition,
the Plaintiff alleges that in late May 2010, Kerry unilaterally
terminated the LOI in breach of Paragraph 7. In Count Eight, the
Plaintiff alleges that Kerry tortiously interfered with FHR's
prospective contract with the Bank.
In an Oct. 26, 2011 Memorandum Opinion, available at
http://is.gd/cPI3j7from Leagle.com, District Judge Terrence F.
McVerry granted, in part, and denied, in part, Kerry's Motion to
Dismiss the Second Amended Complaint. Count Eight is dismissed
with prejudice. Kerry is required to file an Answer to Counts Six
and Seven of the Second Amended Complaint by Nov. 9, 2011. The
Court held that Count VI of the Second Amended Complaint sets
forth a viable claim for breach of the MCIA. The Court said it
cannot agree with Kerry's assertion that it had no implied duty to
act in good faith. To the contrary, such a duty is implied into
every contract under Wisconsin law. Accordingly, the Motion to
Dismiss Count VII is denied.
As to Count VIII, the Court agrees with Kerry's contention that
the Plaintiff has failed to plead an absence of justification.
The alleged tortious interference is merely duplicative of the
breach of contract claims set forth in Counts Six and Seven.
Kerry had no independent duty under public policy to refrain from
purchasing the Premises directly from the Bank -- particularly
after Kerry learned that the Bank was the rightful owner. Such
duties arose only by way of the LOI and/or MCIA. Thus, the
tortious interference claim is barred by the "gist of the action"
doctrine. The Second Amended Complaint has not set forth a prima
facie case for tortious interference.
New York-based Fresh Harvest River LLC filed for Chapter 11
bankruptcy (Bankr. S.D.N.Y. Case No. 10-14814) on Sept. 12, 2010.
Joshua Joseph Angel, Esq. -- jangel@herrick.com -- at Herrick,
Feinstein LLP, represents the Debtor. In its petition, the Debtor
estimated $1 million to $10 million in assets and debts. The
petition was signed by Jack Gray, manager.
GARY PHILLIPS: Construction Loan Extended Until End of 2013
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Tennessee
has authorized Gary Phillips Construction, LLC, to continue to
borrow under its Construction Loan line of credit with TruPoint
Bank for up to an including Dec. 31, 2013, upon the terms set
forth in the Agreed Order authorizing post-petition financing
entered by the Court on April 29, 2011.
The Debtor is further authorized to enter into a Lease/Purchase
Agreement for Lot 3, upon approval by the Bank's loan committee
and release from the collateral base for the Bank's loans, to
obtain a Term Loan in the principal amount of between $140,000 to
$165,000 under the terms set forth in the joint motion (for
approval of continued post-petition financing) to be secured by a
Deed of Trust as to Lot 3 and an assignment of the rents and such
Term Loan proceeds be applied to the Construction Loan and the
$10,000 paid pursuant to the Lease/Purchase Agreement to be paid
to the Bank toward the Term Loan.
A copy of the court's order approving the joint motion of the
Debtor and TruPoint Bank is available for free at:
http://bankrupt.com/misc/garyphillips.dkt462.pdf
As reported in the TCR on Oct. 10, 2011, Gary Phillips
Construction, LLC, and TruPoint Bank asked the Bankruptcy Court or
authorization to extend and modify an agreed order for the
Debtor's postpetition loans.
The Debtor owns a property consisting of 11 lots in Cardinal
Forest, Washington County, Tennessee. The Debtor financed the
acquisition by a loan from the bank in the original principal
amount of $380,000, secured by a deed of trust. As of the filing
date, the outstanding balance of the acquisition loan was
$278,666.
Simultaneously with the acquisition loan, the Debtor obtained a
construction loan from the bank in the original principal amount
of $600,000, secured by a deed of trust. As of the filing date,
the outstanding balance of the construction loan was $521,882.
The parties request that the Debtor be authorized to obtain
postpetition financing until Dec. 31, 2013. The parties related
that the agreed order only provided that the bank would provide
postpetition financing through the end of calendar year 2011.
The Debtor related that it has completed construction of the house
on Lot 3 and has entered into a lease/purchase agreement as to the
same. In this regard, the Debtor has requested that Lot 3 be
released from the collateral base securing the acquisition and
construction loan.
The terms of the postpetition financing will be identical to
theterms in the prior motion, among other things:
-- subject to the approval by the bank's loan committee, the
Debtor will obtain a new and separate term loan in a principal
amount ranging from $140,000 to $165,000 to be secured by a
deed of trust as to lot 3 and an assignment of rents;
-- standard credit terms will apply and the Debtor will be
charged interest at the rate of 6%;
-- the proceeds of the lot will be paid against the
construction loan principal;
-- the lot 3 term loan will be cross-collaterized against the
bank's collateral under the acquisition loan;
-- as before, the Debtor and the Official Committee of
Unsecured Creditors will have 90 days within which to file an
objection as to the claim of the bank based on the perfection,
extent, validity, or priority of the same.
About Gary Phillips Construction
Piney Flats, Tennessee-based Gary Phillips Construction, LLC,
filed for Chapter 11 bankruptcy protection (Bankr. E.D. Tenn. Case
No. 10-53097) on Dec. 3, 2010. Fred M. Leonard, Esq. --
fredmleonard@earthlink.net -- in Bristol, Tennessee, serves as the
Debtor's counsel. The Debtor tapped Wayne Turbyfield as
accountant. The Court denied the application to employ Crye-Leike
Realtors as realtor. In its schedules, the Debtor disclosed
$13,255,698 in assets and $7,614,399 in liabilities as of the
Petition Date.
Daniel M. McDermott, the U.S. Trustee for Region 8, appointed six
creditors to serve on an Official Committee of Unsecured Creditors
in the Debtor's case. Dean B. Farmer, Esq., at Hodges, Doughty &
Carson, PLLC, serves as the committee's counsel.
GIORDANO'S ENTERPRISES: Ch. 11 Trustee Wants IFN as Lead Bidder
---------------------------------------------------------------
Mark Heschmeyer at CoStar Group reports that Philip V. Martino,
the Chapter 11 Trustee for Giordano's Enterprises Inc., filed a
motion to approve Italian Food Network LLC, as the stalking horse
bidder to purchase Giordano's restaurant operations for
$26 million.
According to the report, the deal does not include the real estate
in which many of the restaurants; those assets are still to be
sold separately.
The report notes the trustee is seeking approval to set Nov. 10,
2011, as the deadline for the submission of competing bids and
Nov. 15, 2011, as the auction date. The trustee expects the
bidding for the real estate to be robust.
The report says William Blair & Company LLC is marketing the
restaurant assets and Hilco Real Estate LLC is marketing the real
estate portfolio.
About Giordano's Enterprises
Chicago, Illinois-based Giordano's Enterprises, Inc., was founded
in 1974 in Chicago, Illinois, by two Argentinean immigrants, Efren
and Joseph Boglio. In 1988, John and Eva Apostolou purchased
control of Giordano's. Although this casual dining eatery offers
a broad array of fine Italian cuisine, it is primarily know for
its "Chicago's World Famous Stuffed Pizza". At present,
Giordano's operates six company owned stores in Chicagoland, four
joint venture stores, and thirty-five franchisee locations. In
addition, Giordano's operates Americana Foods, Inc., located in
Mount Prospect, Illinois, that serves as the commissary for the
majority of food products purchased by the Illinois locations.
An affiliated real estate holding company, Randolph Partners, LP,
owns 12 restaurant buildings that are leased to four of the
company-owned locations, two of the joint venture locations and
six of the franchisee locations. The other 33 locations are
leased from third party landlords; two for the Giordano's
locations, two for the joint venture locations and 29 for the
franchise locations. Giordano's is the lessee and subleases the
restaurant facility for 22 of the 29 franchise third party leases.
JBA Equipment Finance, Inc, another affiliated entity, leases
restaurant equipment packages to eight franchisee locations.
Giordano's Enterprises and 26 affiliates filed for Chapter 11
bankruptcy protection (Bankr. N.D. Ill. Lead Case No. 11-06098) on
Feb. 16, 2011. Six additional affiliates filed for Chapter 11
protection on Feb. 17, 2011. Michael L. Gesas, Esq., David A.
Golin, Esq., Miriam R. Stein, Esq., and Kevin H. Morse, at
Arnstein & Lehr, LLP, in Chicago, serve as the Debtors'
bankruptcy counsel. Giordano's Enterprises disclosed $59,387 in
assets and $45,538,574 in liabilities as of the Chapter 11 filing.
Certain of the Debtors owe Fifth Third Bank not than $13,560,662,
pursuant to loans and financial accommodations, and $31,927,998
under a business loan as of the Petition Date. Fifth Third has
agreed to provide DIP financing of up to $35,983,563 to the
Debtors.
Philip V. Martino was appointed as Chapter 11 trustee in the
Debtors' bankruptcy cases, at the behest of the U.S. Trustee.
Mr. Martino filed a $3,000,000 bond.
GLOBAL GEOPHYSICAL: Moody's Affirms 'B2' Corporate Family Rating
----------------------------------------------------------------
Moody's changed Global Geophysical Services, Inc.'s (GGS) outlook
to negative from stable and lowered its Speculative Grade
Liquidity (SGL) rating to SGL-3 from SGL-2. Moody's also affirmed
its B2 Corporate Family Rating (CFR) and B3 senior unsecured notes
ratings.
RATINGS RATIONALE
We expect EBITDA to increase materially in the second half of 2011
given the revenue backlog as of June 30, 2011; however, the
negative outlook reflects uncertainties around the sustainability
of the improvement through 2012. This concern considers weak
seismic sector conditions, as well as the potential for tight
liquidity if the company were to experience negative free cash
flow in 2012. At June 30, $49 million of its $70 million secured
credit facility was drawn.
The SGL-3 reflects Moody's expectation of adequate liquidity
through the first half of 2012 given a June 30, 2011 cash balance
of $13 million, credit facility availability of $21, and Moody's
expectation that the company will fund the vast majority of
capital spending for the second half of 2011 with cash flow.
Covenants under the $70 million senior secured credit facility due
2013 include EBITDA/interest of not less than 2.5x and senior
secured debt/EBITDA of no more than 2.0x. As of June 30, GGS had
good headroom under these covenants. GGS has no debt maturities
until 2013. Substantially all of the company's assets are pledged
as security under the credit facility which limits the extent to
which asset sales could provide a source of additional liquidity
if needed.
The B2 CFR reflects GGS' small size and the inherent volatility of
its business lines relative to B2 oil services peers, balanced by
its international diversification, high quality customer base,
solid reputation in the industry, use of the latest technologies
to enhance its competitive position, and seasoned management team
with long sector experience. The CFR also considers GGS' focus on
the land and transition zone markets, which Moody's views as less
favorable than the marine markets which are larger and tend to
have more stable demand.
We could downgrade the ratings if liquidity were to deteriorate or
if adjusted Debt/EBITDA (net of multi-client spending) were
expected to be sustained at or above 5x. Moody's will move the
outlook to stable if EBITDA improves as anticipated in the second
half of 2011, and if the higher EBITDA levels appear sustainable
through 2012 with the expectation that adjusted Debt/EBITDA (net
of multi-client spending) will remain below 5x through the
industry cycles.
The principal methodology used in rating GGS was the Global
Oilfield Services Industry Methodology published in December 2009.
Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.
Global Geophysical Services, Inc. which is headquartered in
Houston, Texas, provides an integrated suite of seismic data
solutions to the global oil and gas industry.
HARRINGTON WEST: TruPS Holders Seek Chapter 7 Liquidation
---------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the attempted reorganization of Harrington West
Financial Group Inc. should be converted to a liquidation in
Chapter 7, according to Holdco Advisors LP, as agent for trust-
preferred securities, commonly known as TruPS.
Mr. Rochelle recounts that Harrington was the parent of failed Los
Padres Bank FSB, which was taken over by regulators August 2010.
Although Harrington had an approved disclosure statement, the plan
couldn't be confirmed in September because both classes of voting
creditors said "no." One class included the TruPS, while the
other was voted down by the Federal Deposit Insurance Corp.
According to the report, since the plan failed, Holdco says
Harrington hasn't been able to come up with an alternative
acceptable to the TruPS holders and the FDIC. Holdco argues there
are "insufficient assets" to justify continuation of the Chapter 7
effort. A hearing on the conversion motion hasn't yet been set.
The disclosure statement for the failed plan told unsecured
creditors and holders of $25.8 million in TruPS that they stood to
recover 0.2% from a liquidating trust to be created under the
plan.
Harrington West Financial Group Inc. filed a voluntary petition to
liquidate its assets under Chapter 11 of the Bankruptcy Code
(Bankr. N.D. Calif. Case No. 10-14677) on Sept. 10, 2010. The
holding company filed under Chapter 11 after its banking unit, Los
Padres Bank FSB, was taken over by regulators in August 2010.
Sharon M. Kopman, Esq., at Landau Gottfried & Berger LLP, in Los
Angeles, serves as the Debtor's bankruptcy counsel. In its
schedules, the Debtor disclosed $579,282 in assets and $26,004,000
in liabilities.
HARRISBURG, PA: Mayor Finds Defects in Bankruptcy Filing
--------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the mayor of Harrisburg, Pennsylvania, filed papers
listing a plethora of reasons why the Chapter 9 municipal
bankruptcy filing on Oct. 11 was unauthorized. The Oct. 28 brief
for Mayor Linda D. Thompson describes how the 4-3 vote by the city
council purporting to authorize bankruptcy was merely a resolution
not having the force of law. In addition, the city council
majority failed to utilize required procedures for hiring the
lawyer who filed the petition hours later.
According to the report, the mayor's brief describes the
resolution as nothing more than a policy statement. Moreover,
Ms. Thompson says, it couldn't be implemented without a required
20-day waiting period. Other defects include the failure to
obtain approval from the city solicitor. In addition, the filing
of the petition was an executive action that could only be
undertaken by the mayor. Ms. Thompson says that the "city council
cannot, by resolution, strip the mayor of the executive power to
authorize lawsuits."
Mr. Rochelle also reports that several other objections to the
Chapter 9 petition were filed. One was from Dauphin County where
Harrisburg is located. The state of Pennsylvania filed a brief
laying out its legal arguments. The state previously went on
record explaining how state law prohibited a city of Harrisburg's
size from filing bankruptcy before July 2012.
Ambac Joins List
Mr. Rochelle said in an earlier report that Ambac Assurance Corp.,
the guarantor of $65 million in municipal bonds issued by
Harrisburg, filed papers on Oct. 28 arguing that the city's
Chapter 9 bankruptcy petition should be dismissed at a Nov. 23
hearing. Parroting the objection taken by the state, Ambac cites
Pennsylvania law barring a city of Harrisburg's size from filing
bankruptcy before July 2012.
About Harrisburg, PA
The city of Harrisburg, in Pennsylvania, is coping with debt
related to a failed revamp of an incinerator. The city is
$65 million in default on $242 million owing on bonds sold to
finance an incinerator that converts trash to energy.
Four members of the City Council of Harrisburg on Oct. 11, 2011,
authorized the filing of a Chapter 9 bankruptcy petition (Bankr.
M.D. Pa. Case No. 11-06938) by the City of Harrisburg. Judge Mary
D. France presides over the case. Mark D. Schwartz, Esq. --
markschwartz6814@gmail.com -- and David A. Gradwohl, Esq., serve
as counsel. The petition estimated $100 million to $500 million
in assets and debts. Susan Wilson, the city's chairperson on
Budget and Finance, signed the petition.
The city council voted 4-3 on Oct. 11, 2011, to authorize the
Chapter 9 municipal bankruptcy filing. The city claims to be
insolvent, unable to pay its debt and in imminent danger of having
tax revenue seized by holders of defaulted bonds.
The city said in court papers it is in imminent jeopardy through
six pending legal actions by creditors with respect to a number of
outstanding bond issues relating to the Harrisburg Materials,
Energy, Recycling and Recovery Facilities, which processes waste
into steam and electrical energy. The owner and operator of the
incinerator is The Harrisburg Authority, which is unable to pay
the bond issues. The city is the primary guarantor under each
bond issue. The lawsuits were filed by Dauphin County, where
Harrisburg is located, Joseph and Jacalyn Lahr, TD Bank N.A., and
Covanta Harrisburg Inc.
Two days after the Chapter 9 filing on Oct. 11, the state of
Pennsylvania filed a motion to dismiss the case as being
unauthorized. Later, the state adopted a new law allowing the
governor to appoint a receiver who may join those seeking
dismissal.
Harrisburg Mayor Linda D. Thompson and the state of Pennsylvania
have objected to the bankruptcy filing. Mayor Thompson is
represented in the case by Kenneth W. Lee, Esq., Christopher E.
Fisher, Esq., Beverly Weiss Manne, Esq., and Michael A. Shiner,
Esq., at Tucker Arensberg, P.C. Counsel to the Commonwealth of
Pennsylvania are Neal D. Colton, Esq., Jeffrey G. Weil, Esq., Eric
L. Scherling, Esq., at Cozen O'Connor.
HARVEST OAKS: Further Amends Plan Outline, Has Nov. 9 Hearing
-------------------------------------------------------------
Harvest Oaks Drive Associates, LLC, submitted to the U.S.
Bankruptcy Court for the Eastern District of North Carolina a
third amended version of its plan of reorganization and disclosure
statement dated Oct. 19, 2011.
Among other things, the 3rd Amended Plan includes an exhibit of a
feasibility analysis of the Debtor's Plan with revised figures.
Judge Stephani W. Humrickhouse conditionally approved the second
amended disclosure statement explaining the Debtor's Plan on
Aug. 29, 2011. As reported in the Aug. 19, 2011 edition of the
Troubled Company Reporter, the Plan contemplates a reorganization
and continuation of the Debtor's business. Certain creditor
claims will be satisfied from income earned through the continued
operations of the Debtor's business. The Plan designates 10
classes of claims and interests.
The Court has rescheduled the plan-related hearing to Nov. 9,
2011, at 10:30 a.m. A confirmation hearing was previously
scheduled for Sept. 29, 2011.
A full-text copy of the 3rd Amended Disclosure Statement is
available for free at:
http://bankrupt.com/misc/HARVESTOAKS_3rdAmdDSOct19.pdf
About Harvest Oaks
Harvest Oaks Drive Associates, LLC, owns a shopping center in
North Raleigh located at 9650 Strickland Road and 8801 Lead Mine
Road, in Raleigh, North Carolina. The Shopping Center has
numerous tenants that include chain stores such as the Kerr Drug
and the UPS store, and local businesses such as restaurants,
shops, and other retail businesses.
The Company filed for Chapter 11 bankruptcy protection (Bankr.
E.D.N.C. Case No. 10-03145) on April 21, 2010. Trawick H
Stubbs, Jr., Esq., at Stubbs & Perdue, P.A., assists the Company
in its restructuring effort. In its schedules, the Company
disclosed $15,832,000 in assets and $14,634,161 in debts.
HAWAII MEDICAL: Owners Seek New Buyer After SFHS Abandons Plan
--------------------------------------------------------------
Star Advertiser reports that owners of the former St. Francis
Medical Centers said they are in discussions with potential buyers
for the financially troubled hospitals in Liliha and Ewa, Hawaii,
following a decision by St. Francis Healthcare System of Hawaii to
abandon a bankruptcy reorganization plan that would've returned
the facilities to them.
"Hawaii Medical Center and St. Francis Healthcare System have been
unable to resolve outstanding issues related to the amended plan
of reorganization," the report quotes HMC CEO Maria Kostylo as
saying. "The financial contributions required to fund ongoing
operations for Hawaii Medical Center and the governmental
liabilities are too great for St. Francis to assume. Because of
this, St. Francis can no longer support the reorganization plan."
"We are aggressively pursuing other potential buyers and continue
to receive funding from MidCap Financial to support our efforts,"
Mr. Kostylo said.
About Hawaii Medical Center
The Hawaii Medical Center, along with its affiliates, filed for
Chapter 11 bankruptcy (Bankr. D. Hawaii Lead Case No. 11-01746) on
June 21, 2011, just a year after exiting court protection. Hawaii
Medical Center owns two hospital campuses -- HMC East in North
Honolulu and HMC West in Ewa Beach. The two hospitals have 342
licensed beds and have a total of more than 1,000 employees. The
hospitals were known as St. Francis Medical Center before Hawaii
Medical purchased the hospitals in 2007.
Judge Robert J. Faris presides over the 2011 case. Lawyers at
Moseley Biehl Tsugawa Lau & Muzzi, in Honolulu, Hawaii, and
McDonald Hopkins LLC, in Cleveland, Ohio, serve as the Debtors'
counsel. The Debtors' financial advisors are Scouler & Company,
LLC. In its petition, Hawaii Medical Center estimated $50 million
to $100 million in assets and $100 million to $500 million in
debts. The petitions were signed by Kenneth J. Silva, member of
the board of directors.
Attorneys at Wagner Choi & Verbrugge, in Honolulu, Hawaii, and
Pachulski Stang Ziehl & Jones LLP, in Los Angeles, represent the
Official Committee of Unsecured Creditors as counsel.
The Debtors' prepetition debt structure is comprised of (i) the
Prepetition Revolving Loan with MidCap Financial, LLC, and the
Prepetition Term Loan with St. Francis Healthcare Systems of
Hawaii. As of the Petition Date, the aggregate outstanding
principal on the Prepetition MidCap Revolving Loan and the
Prepetition St. Francis Term Loan is $46,851,772. The principal
balance of the Prepetion MidCap Revolving Loan is $7,676,495. The
amount owed under the Prepetition St. Francis Term Loan is
$39,175,277, secured by St. Francis's first priority lien on,
among other things, all real property of the Debtors.
Through the Chapter 11 filing, the Debtors plan to return the
hospitals to the control of St. Francis.
In the prior case, HMC and its affiliated debtors were converted
to new, Hawaii non-profit corporations. CHA Hawaii, one of HMC's
affiliated debtors and a subsidiary of Cardiovascular Hospitals of
America LLC, discontinued management of the reorganized Debtors.
Wichita, Kansas-based CHA Hawaii LLC, and its affiliates --
including Hawaii Medical Center LLC -- filed for Chapter 11
protection on Aug. 29, 2008 (Bankr. D. Del. Case No. 08-12027).
Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP
represented the Debtors in their restructuring efforts. CHA
Hawaii estimated assets of up to $10 million and debts between
$50 million and $100 million when it filed for bankruptcy. The
Debtors obtained confirmation of their Chapter 11 plan in May 2010
and emerged from bankruptcy in August 2010.
The Debtor disclosed $74,713,475 in assets and $91,599,563 in
liabilities as of the Chapter 11 filing.
St. Francis Healthcare System of Hawaii is represented by:
Jonathan H. Steiner, Esq.
McCORRISTON MILLER MUKAI MACKINNON LLP
Five Waterfrong Plaza, Fourth Floor
500 Ala Moana Boulevard
Honolulu, HI 96813
Tel: (808) 529-7300
Fax: (808) 524-8293
E-mail: steiner@m4law.com
- and -
Joshua M. Mester
DEWEY & LEBOEUF LLP
333 South Grand Avenue, 26th Floor
Los Angeles, CA 90071
Tel: (213) 621-6000
Fax: (213) 621-6100
E-mail: jmester@dl.com
HERBASWAY LAB: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: HerbaSway Laboratories LLC
101 No. Plains Industrial Road
Building 3
Wallingford, CT 06492
Bankruptcy Case No.: 11-32713
Chapter 11 Petition Date: October 25, 2011
Court: United States Bankruptcy Court
District of Connecticut (New Haven)
Judge: Lorraine Murphy Weil
Debtor's Counsel: Ronald Chorches, Esq.
LAW OFFICES OF RONALD I. CHORCHES
449 Silas Deane Highway, 2nd Floor
Wethersfield, CT 06109
Tel: (860) 563-3955
Fax: (860) 513-1577
E-mail: ronchorcheslaw@sbcglobal.net
Scheduled Assets: $444,146
Scheduled Debts: $4,003,945
A list of the Company's 20 largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/ctb11-32713.pdf
The petition was signed by Franklin St. John, member.
HOLLIFIELD RANCHES: Amends Plan Outline, Hearing Moved to Nov. 22
-----------------------------------------------------------------
Hollifield Ranches, Inc., filed with the U.S. Bankruptcy Court for
the District of Idaho a second amended disclosure statement dated
Oct. 24, 2011, explaining its second amended Chapter 11 plan.
The 2nd Amended Disclosure Statement reveals that the Plan now
designates 18 classes of claims and interests, where by
Administrative Claims under Sec. 503(b)(9) has been added under
Class 17 while Unsecured Claims is now designated as Class 18
Claims. The payment amounts estimated for each class of claim and
interests are also updated. The amount to be paid annually on the
classified claims and interests total $1.6 million.
Administrative Claims will be paid two years after confirmation.
The 2nd Amended Disclosure Statements also added details on
certain entity mergers and an explanation of the Debtor's budgets.
The Debtor also conducted a liquidation analysis, and disclosed
that if its case were converted into a Chapter 7 liquidation
proceeding, an assumption of loss of up to 15% would likely occur.
As reported by the Troubled Company Reporter on Aug. 22, 2011, the
Plan provides that priority claims will be paid in full; secured
debts will be paid to the extent of their values; unsecured debts
will be paid (in a fair and equitable manner) to the extent the
unsecured property of the estate reaches to those creditors or
that the cash flow allows, and other properties will be disbursed
and addressed.
A full-text copy of the 2nd Amended Disclosure Statement is
available for free at:
http://bankrupt.com/misc/HOLLIFIEDRANCHES_2ndAmdDSOct24.pdf
Plan Outline Hearing Continued to Nov. 22
The Court has continued the hearing to consider the Second Amended
Disclosure Statement to Nov. 22, 2011, at 1:30 p.m.
The Court held a hearing on 1st Amended Disclosure Statement on
Sept. 27, 2011. After hearing arguments from interested parties,
the Court sustained objections to the 1st Amended Disclosure
Statement and denied approval of the said plan outline.
The Court held at the Sept. 27 hearing that the 1st Amended
Disclosure Statement "was not comprehensive enough." It also
ordered the Debtor to file a further revised Disclosure Statement.
Brent Robinson, Esq., at Robinson, Anthon & Tribe, for the Debtor;
Glenn W. Godfrey, Esq., at May, Browning & May, for the Official
Committee of Unsecured Creditors; Randall Peterman, Esq., of
Moffati Thomas Barrett Rock & Field, Chartered, for Keybank
National Association; and Mary Kimmel, Esq., trial attorney for
the U.S. Trustee appeared before the Court at the Sept. 27
hearing. The same parties have been directed by the Court to meet
prior to the Nov. 22 hearing to resolve outstanding issues.
About Hollifield Ranches, Inc.
Hansen, Idaho-based Hollifield Ranches, Inc., filed for Chapter 11
bankruptcy protection on September 9, 2010 (Bankr. D. Idaho Case
No. 10-41613). Brent T. Robinson, Esq., in Rupert, Idaho,
represents the Debtor. The Debtor estimated assets and debts at
$10 million to $50 million as of the Chapter 11 filing.
Robert D. Miller, Jr. ,the United States Trustee for Region 18,
has appointed three creditors to serve as members of the Unsecured
Creditors' Committee in the Chapter 11 case of Hollifield Ranches,
Inc. J. Justin May, Esq., at May, Browning & May represents the
Official Committee of Unsecured Creditors.
KEELEY AND GRABANSKI: Section 341(a) Meeting Scheduled for Dec. 2
------------------------------------------------------------------
The U.S. Trustee for Region 12 will convene a meeting of creditors
of Keeley and Grabanski Land Partnership on Dec. 2, 2011, at 9:00
a.m. The meeting will be held at U.S. Post Office, Room 319, 657
2nd Avenue North, Fargo, North Dakota.
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 Keeley and Grabanski
Thomas Grabanski, a North Dakota farmer, is mired in three
separate Chapter 11 bankruptcy cases.
Mr. Grabanski and his wife Mari filed a personal Chapter 11
bankruptcy petition (Bankr. D. N.D. Case No. 10-30902) on July 22,
2010. DeWayne Johnston, Esq., at Johnston Law Office, represents
the Grabanskis in their Chapter 11 case. The Grabanskis estimated
assets between $1 million and $10 million, and debts between $10
million and $50 million.
On July 23, 2010, Mr. Grabanski signed a Chapter 11 petition for
Grabanski Grain LLC (Bankr. D. N.D. Case No. 10-30924). DeWayne
Johnston, Esq., also represents Grabanski Grain. The Debtor is
estimated to have assets and debts of $1 million to $10 million.
Former owners in December 2010 forced the partnership Keeley and
Grabanski Land Partnership in Texas into Chapter 11. John and
Dawn Keely, the former owners, filed an involuntary Chapter 11
bankruptcy petition against the partnership (Bankr. D. N.D. Case
No. 10-31482) on Dec. 6, 2010. Kenneth Corey-Edstrom, Esq., at
Larkin Hoffman Daly & Lindgren Ltd., represents the petitioner.
The U.S. Bankruptcy Appellate Panel for the Eighth Circuit
affirmed the Bankruptcy Court's order appointing a trustee in
Keeley and Grabanski Land Partnership's involuntary Chapter 11
case. Kip M. Kaler, Chapter 11 trustee of Keeley and Grabanski
Land Partnership, authority to employ Kaler Doeling Law Office as
counsel.
Keeley and Grabanski Land Partnership in Texas -- since 2009 doing
business as Grabanski Land Partnership -- was formed in 2007 for
Texas farming operations between farmers Thomas Grabanski and John
Keeley of Grafton, N.D., and their wives. K&G Land, along with a
separate farming partnership, operated more than 10,000 acres of
corn and sunflowers from 2007 to 2009 in two locations in Texas
near the towns of Blossom and DeKalb.
In separate, related lawsuits, the Grabanskis face several
"adversarial" lawsuits, filed by certain creditors. The creditors
who filed suits include Crops Production Services Corp., AgCountry
Farm Credit Services, and PHI Financial.
KINETIC CONCEPTS: S&P Assigns 'BB-' Rating to $325-Mil. Term Loan
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned a 'BB-' senior secured
issue-level rating and '1' recovery rating on San Antonio-based
medical technology company Kinetic Concepts Inc.'s (KCI) $325
million senior secured first-lien term loan C maturing in 2016.
"The '1' recovery rating reflects our expectation for very high
(90% to 100%) recovery for first-lien senior secured lenders in
the event of a payment default. Despite some changes in the
company's new capital structure since KCI's initial proposal and
ratings, all of our ratings remain unchanged. The company will use
the proceeds from the debt offerings to fund the proposed
leveraged buyout (LBO) of KCI by private-equity firm Apax Partners
L.P., the Canada Pension Plan Investment Board, and the Public
Sector Pension Investment Board," S&P related.
KCI's 'BB+' corporate credit rating is on CreditWatch with
negative implications. "We originally placed KCI's corporate
credit rating on CreditWatch Negative on July 8, 2011, following
reports that that the company may be subject to a takeover by a
private-equity firm. Following the completion of the proposed LBO
(likely before the end of 2011), we expect to remove our corporate
credit rating on KCI from CreditWatch and lower it to 'B' from
'BB+', reflecting increased debt leverage and low cash flow
relative to LBO-related debt. At the same time, we expect to
assign a stable outlook, reflecting the company's relatively
stable operating performance and cash flows throughout the recent
three-year global economic downturn. This should partly offset the
company's very high interest expense and capital expenditures,"
S&P said.
"We expect KCI's pre-LBO debt to be retired as part of the
proposed LBO; we will withdraw those ratings at that time," S&P
related.
(For the complete corporate credit rating rationale, see the
research update on KCI, published July 8, 2011, on RatingsDirect
on the Global Credit Portal. For the complete recovery analysis,
see the recovery report on KCI, to be published separately on
RatingsDirect.)
Ratings List
Kinetic Concepts Inc.
Corporate Credit Rating BB+/Watch Neg/--
New Ratings
Kinetic Concepts Inc.
Senior Secured
$325 mil first-lien term loan C due 2016 BB-
Recovery Rating 1
KOREA TECHNOLOGY: U.S. Trustee Appoints 3-Member Creditors' Panel
-----------------------------------------------------------------
Richard A. Wieland, the United States Trustee for Region 19,
pursuant to 11 U.S.C. Sec. 1102(a) and (b), appointed three
unsecured creditors to serve on the Official Committee of
Unsecured Creditors of Korea Technology Industry America, Inc.
The Creditors Committee members are:
1. Haynie & Company
Attn: Scott Reams, Partner
1785 West Printers Row
Salt Lake City, UT 84403
Tel: (801) 972-4800
Fax: (801) 972-8941
E-mail: ScottR@hayniecpas.com
2. Frontier Petroleum, LLC
(Formerly known as Gavilan Petroleum, LLC)
Attn: Tom Bachtell, Manager
1245 E. Brickyard Road, Suite 110
Salt Lake City, UT 84106
Tel: (801) 466-4131
E-mail: utah@windrivercompanies.com
3. Western Energy Partners
6440 S. Wasatch Blvd., Suite 105
Salt Lake City, UT 84121
Tel: (801) 277-5885
Fax: (801) 273-4119
Attorney for Western Energy Partners
Robert Prince
KIRTON & MCCONKIE
1800 Eagle Gate Tower
60 East South Temple
P.O. Box 45120
Salt Lake City, UT 84124
Tel: (801) 328-3600
Fax: (801) 321-4893
E-mail: rprince@kmclaw.com
About Korea Technology
Korea Technology Industry America, Inc., is a subsidiary of Seoul-
based Korea Technology Industry Co. that tried to squeeze crude
oil from Utah's sandy ridges. Korea Technology Industry America,
Uintah Basin Resources LLC, and Crown Asphalt Ridge L.L.C., filed
separate Chapter 11 bankruptcy petitions (Bankr. D. Utah Case Nos.
11-32259, 11-32261, and 11-32264) on Aug. 22, 2011. The cases are
jointly administered under KTIA's case. Steven J. McCardell,
Esq., and Kenneth L. Cannon II, Esq., at Durham Jones & Pinegar,
in Salt Lake City, serve as the Debtors' counsel. The Debtors
listed US$35,246,360 in assets and US$38,751,528 in debts.
LIN TV: S&P Affirms 'B' Corp. Credit Rating; Outlook Stable
-----------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B' corporate
credit rating on Providence, R.I.-based TV broadcaster LIN TV
Corp. The rating outlook is stable.
"At the same time, we revised our recovery rating on LIN
Television Corp.'s $200 million senior unsecured notes to '2' from
'1'. The '2' recovery rating indicates our expectation of
substantial (70%-90%) recovery for noteholders in the event of a
payment default. As per our notching criteria for a '2' recovery
rating, we lowered our issue-level rating on this debt to 'B+'
(one notch higher than the 'B' corporate credit rating on the
parent company) from 'BB-'," S&P said.
"We also revised our recovery rating on LIN Television Corp.'s
6.5% senior subordinated notes due 2013 to '6' from '5'. The '6'
recovery rating indicates our expectation of negligible (0%-10%)
recovery for noteholders in the event of a payment default. As per
our notching criteria for a '6' recovery rating, we lowered our
issue-level rating on this debt to 'CCC+' (two notches lower
than the 'B' corporate credit rating on the parent company) from
'B-'," S&P said.
"The company plans to use proceeds from its new term loan A and
revolving credit borrowings, which we have not rated, to redeem a
portion of the 6.5% senior subordinated notes. The revision of the
recovery ratings on the existing debt issues reflects their lower
recovery prospects after the higher-ranking credit facilities are
added to the company's capital structure," S&P related.
"The corporate credit rating affirmation reflects our view that
the transaction is essentially leverage-neutral and will slightly
improve LIN's lease-adjusted EBITDA coverage of interest," said
Standard & Poor's credit analyst Deborah Kinzer, "by replacing
higher-coupon debt with lower-cost bank borrowings." "Our rating
on LIN reflects our expectation that the company's fully adjusted
debt to EBITDA (including leases, pensions, and contingent joint-
venture obligations) will rise above 10x for full-year 2011 as the
benefit of 2010 political advertising revenue rolls off (although
this ratio will remain below the extremely high levels of 2009).
We believe this metric will then turn around in mid-2012 as
political ad revenue increases."
"The rating further reflects our view of LIN's business risk
profile as 'fair' (as our criteria defines the term), based on its
midsize TV station group with an EBITDA margin comparable to its
peers'. In addition, we view the company's financial risk profile
as 'highly leveraged,' with fully adjusted debt to EBITDA of 8.4x
as of June 30, 2011 (according to Standard & Poor's financial
risk indicative ratios, debt to EBITDA of greater than 5x
qualifies as a highly leveraged financial risk profile)," S&P
related.
L K IMPERIAL: Case Summary & Largest Unsecured Creditor
-------------------------------------------------------
Debtor: L K Imperial Development, LLC
15721 Bernardo Heights Pkwy, Suite B117
San Diego, CA 92128
Bankruptcy Case No.: 11-17482
Chapter 11 Petition Date: October 25, 2011
Court: United States Bankruptcy Court
Southern District of California (San Diego)
Judge: Margaret M. Mann
Debtor's Counsel: Scott R. Burton, Esq.
LAW OFFICE OF SCOTT R. BURTON
574 S. Rancho Santa Fe Road
San Marcos, CA 92069
Tel: (866) 370-4283
E-mail: srburtonatty@aol.com
Scheduled Assets: $8,780,000
Scheduled Debts: $5,000,000
In its list of 20 largest unsecured creditors, the Company placed
only one entry:
Entity Nature of Claim Claim Amount
------ --------------- ------------
All Century Ins. Note on Fifth $5,000,000
The Croft LLC Ave. Property
Bijan Todd
The petition was signed by Loran Kelley Jr., operating manager.
LANDAMERICA FINANCIAL: Court Rejects Severance Claims
-----------------------------------------------------
At the behest of the trustee under the confirmed Joint Chapter 11
plan of liquidation for LandAmerica Financial Group, Inc.,
Bankruptcy Judge Kevin R. Huennekens disallowed certain severance
claims filed by former employees of the Debtors whose employment
had been terminated in late December 2008 and early January 2009.
The Court finds that the employment of the Claimants was
terminated in each instance after the date on which the Severance
Benefits Plan For LandAmerica Financial Group Inc. was terminated.
A copy of Judge Huennekens' Oct. 28, 2011 Memorandum Opinion is
available at http://is.gd/vArMEPfrom Leagle.com.
About LandAmerica Financial
LandAmerica Financial Group, Inc., provided real estate
transaction services with offices nationwide and a vast network of
active agents. LandAmerica Financial Group and its affiliate
LandAmerica 1031 Exchange Services Inc. filed for Chapter 11
protection (Bankr. E.D. Va. Lead Case No. 08-35994) on Nov. 26,
2008. Attorneys at Willkie Farr & Gallagher LLP and McGuireWoods
LLP served as co-counsel. Zolfo Cooper served as restructuring
advisor. Epiq Bankruptcy Solutions served as claims and notice
agent.
Attorneys at Akin Gump Strauss Hauer & Feld LLP and Tavenner &
Beran PLC served as counsel to the Creditors Committee of 1031
Exchange. Bingham McCutchen LLP and LeClair Ryan served as
counsel to the Creditors Committee of LFG.
In its bankruptcy petition, LFG reported total assets of
$3.325 billion and total debts of $2.839 billion as of Sept. 30,
2008.
On March 6, 2009, March 27, 2009, March 31, 2009, July 17, 2009,
Oct. 12, 2009, and Nov. 4, 2009, various LFG affiliates --
LandAmerica Assessment Corporation, LandAmerica Title Company,
Southland Title Corporation, Southland Title of Orange County,
Southland Title of San Diego, LandAmerica Credit Services, Inc.,
Capital Title Group, Inc., and LandAmerica OneStop Inc. -- also
commenced voluntary Chapter 11 cases. The Chapter 11 cases of
LFG, LES, and the LFG Affiliates are jointly administered under
case number 08-35994.
LandAmerica filed a Joint Plan of Liquidation on Sept. 9, 2009.
The Court on Nov. 23, 2009, entered an order confirming the Joint
Chapter 11 Plan of LFG and its Affiliated Debtors, dated Nov. 16,
2009, as to all Debtors other than OneStop. The effective date
with respect to the Plan was Dec. 7, 2009. Plan trustees were
appointed for LFG and LES.
LAS VEGAS MONORAIL: US Bank Wants Resolicitation Order "Expunged"
-----------------------------------------------------------------
On Oct. 4, 2011, the U.S. Bankruptcy Court for the District of
Nevada entered an amended order granting Las Vegas Monorail
Company's ex parte motion for conditional approval of the
amendment to disclosure statement in support of the Debtor's Third
Amended Plan of Reorganization, as further revised. The
Bankruptcy Court also approved the resolicitation of Classes 4 and
5 with respect to the Debtor's amended plan.
A copy of the third amended plan of reorganization, as further
revised, as filed on Sept. 29, 2011, is available for free at:
http://bankrupt.com/misc/lasvegasmonorail.dkt956.pdf
A combined hearing will be held to consider the final adequacy of
the disclosure statement amendment and confirmation of the amended
plan at the confirmation hearing scheduled for Nov. 14, 2011, at
10:00 a.m.
The Debtor will be required to resolicit only Holders of Class 4
Claims and Holders of Class 5 Claims regarding material
modifications to the treatment of Holders of Class 4 Claims and
Holders of Class 5 Claims in the Amended Plan, as the remaining
impaired Classes which are entitled to vote, consisting of Classes
3 and 8, are not materially affected by the modification.
Any objections to confirmation will be filed and served no later
than Oct. 31, 2011. The Debtor's confirmation brief and any reply
to any objections to confirmation will be due on Nov. 7, 2011.
The ballot deadline regarding the resolicitation approved by this
order will be Nov. 7, 2011, at 4:00 p.m.
U.S. Bank National Association, as indenture trustee, has
requested the Bankruptcy Court to reconsider and "expunge" the
resolicitation order from the Court's docket.
U.S. Bank's objection was based on the following issues:
(i) While the Debtor stated that resolicitation only of Class 4
and 5 Holders is appropriate because the remaining voting
classes are not "materially affected" by the proposed plan
modifications and Holders of Class 6 claims "are not
receiving or retaining any interest under the Amended Plan",
the Class 6 Holders' voting status is irrelevant.
(ii) Despite the Debtor's characterization, the proposed plan
changes do not merely entail certain differences in class
treatment for the Holders of Class 4 and Class 5 Claims, but
involve material modifications to various provisions of the
Third Amended Plan, which require resolicitation for all
classes.
(iii) The Debtor suggested that a limited resolicitation is
warranted because the deadline for filing confirmation
objections to the Debtor's plan expired on Aug. 24, 2011.
However, the August 24 deadline pertained to the Debtor's
prior plan, not to the Third amended Plan, for which there
is an Oct. 31, 2011 objection deadline.
U.S. Bank merely asks that the Debtor to be subject to the same
solicitation requirements contained in the July Solicitation
Procedures Order, and that accordingly it be required to provide
Holders of 2nd Tier Bond Claims in Class 6 with the documents
identified in Paragraph 4(b) of the July Solicitation Procedures
Order.
About Las Vegas Monorail
Las Vegas, Nevada-based Las Vegas Monorail Company, organized by
the State of Nevada in 2000 as a nonprofit corporation, owns and
manages the Las Vegas Monorail. The Monorail is a seven-stop,
elevated train system that travels along a 3.9-mile route near the
Las Vegas Strip. LVMC has contracted with Bombardier Transit
Corporation to operate the Monorail. Though it benefits from its
tax-exempt status due to being a nonprofit entity, LVMC claims to
be the first privately-owned public transportation system in the
nation to be funded solely by fares and advertising. LVMC says it
receives no governmental financial support or subsidies.
The Company filed for Chapter 11 bankruptcy protection (Bankr. D.
Nev. Case No. 10-10464) on Jan. 13, 2010. Gerald M. Gordon, Esq.,
at Gordon Silver, assists the Company in its restructuring effort.
Alvarez & Marsal North America, LLC, is the Debtor's financial
advisor. Stradling Yocca Carlson & Rauth is the Debtor's special
bond counsel. Jones Vargas is the Debtor's special corporate
counsel. The Company disclosed $395,959,764 in assets and
$769,515,450 in liabilities as of the Petition Date.
In April 2010, bondholder Ambac Assurance Corp. lost in its bid to
halt the bankruptcy after U.S. Bankruptcy Judge Bruce A. Markell
ruled that Monorail isn't a municipality and is therefore entitled
to reorganize in Chapter 11. U.S. District Judge James Mahan in
Reno upheld the ruling in October 2010.
LEHMAN BROTHERS: Proposes Derivates Pact Amendment Protocol
-----------------------------------------------------------
Lehman Brothers Holdings Inc. and its affiliated debtors ask
Judge James Peck for authority to implement a process for the
consensual amendment and assumption of their non-terminated
derivatives contracts.
The proposed process would allow the Debtors to consensually
amend and assume the contracts in order to provide mutually
satisfactory terms for substitute performance, credit support or
other adequate assurance to counterparties to the contracts.
Under the derivatives contracts, as amended, the Debtors will
obtain substitute performance or another form of adequate
assurance that is mutually agreeable to them and to the
counterparties. In exchange, the Debtors will pay market-based
fees and expenses to secure such adequate assurance.
The applicable Debtor will then assume the amended derivatives
contract. All amounts currently payable to the Debtor under that
contract will continue to be paid to it but such Debtor will have
no future liability.
The Debtors are expected to negotiate with up to 10 or 15
counterparties regarding potential amendments to their non-
terminated agreements, according to court papers.
The Court will hold a hearing on November 16, 2011, to consider
approval of the request. The deadline for filing objections is
November 9, 2011.
About Lehman Brothers
Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was
the fourth largest investment bank in the United States. For
more than 150 years, Lehman Brothers has been a leader in the
global financial markets by serving the financial needs of
corporations, governmental units, institutional clients and
individuals worldwide.
Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy
petition disclosed US$639 billion in assets and US$613 billion in
debts, effectively making the firm's bankruptcy filing the
largest in U.S. history. Several other affiliates followed
thereafter.
Additional units, Merit LLC, LB Somerset LLC and LB Preferred
Somerset LLC, sought for bankruptcy protection in December 2009
or more than a year after LBHI and its other affiliates filed
their bankruptcy cases.
The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at
Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.
On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI.
The Bankruptcy Court has approved Barclays Bank Plc's purchase
of Lehman Brothers' North American investment banking and
capital markets operations and supporting infrastructure for
US$1.75 billion. Nomura Holdings Inc., the largest brokerage
house in Japan, purchased LBHI's operations in Europe for US$2
plus the retention of most of employees. Nomura also bought
Lehman's operations in the Asia Pacific for US$225 million.
International Operations Collapse
Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, was placed into administration,
together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE
Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to Lehman Brothers
International (Europe) on Sept. 15, 2008. The joint
administrators have been appointed to wind down the business.
Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan
Inc. filed for bankruptcy in the Tokyo District Court on
Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4
trillion (US$33 billion) in liabilities in its petition.
Judge James Peck on Aug. 30, 2011, approved the disclosure
statement, which outlines the major provisions of Lehman's
$65 billion liquidation plan. The proposed plan would enable LBHI
and its affiliated debtors to pay an estimated $65 billion to
their creditors. Voting on the Plan ends on Nov. 4, 2011. A
hearing to consider confirmation of the Plan is set for Dec. 6,
2011.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and other
insolvency and bankruptcy proceedings undertaken by its
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
LEHMAN BROTHERS: Insurers to Cover CalPERS Suit Settlement
----------------------------------------------------------
Lehman Brothers Holdings Inc. seeks court ruling authorizing
certain underwriters at Lloyd's, London and three insurance firms
to cover the payment to settle the lawsuits against former and
current officials and employees.
Earlier, the defendants entered into agreements to settle the
lawsuits filed in courts by the California Public Employees'
Retirement System, the Washington State Investment Board and the
American National Life Insurance Company of Texas.
The suits stemmed from the purchase by CalPERS, WSIB and ANICO of
more than $800 million worth of Lehman securities prior to the
company's bankruptcy filing.
The defendants also reached a settlement of the arbitration case
filed by 4Kids Entertainment Inc. before a regulatory agency.
The case seeks payment of approximately $36 million in damages
that 4Kids allegedly suffered after investing in auction rate
securities.
The three other insurance firms asked to pay for the settlements
are Illinois National Insurance Company, Chartis Excess Limited,
and Axis Specialty Limited Bermuda.
Illinois National provides coverage of $20 million in excess of
$210 million while Lloyd's provides coverage of $10 million in
excess of $200 million. Meanwhile, the two other insurance firms
collectively provide coverage of $20 million in excess of $230
million.
Judge James Peck will hold a hearing on November 16, 2011, to
consider approval of the request. The deadline for filing
objections is November 9, 2011.
About Lehman Brothers
Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was
the fourth largest investment bank in the United States. For
more than 150 years, Lehman Brothers has been a leader in the
global financial markets by serving the financial needs of
corporations, governmental units, institutional clients and
individuals worldwide.
Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy
petition disclosed US$639 billion in assets and US$613 billion in
debts, effectively making the firm's bankruptcy filing the
largest in U.S. history. Several other affiliates followed
thereafter.
Additional units, Merit LLC, LB Somerset LLC and LB Preferred
Somerset LLC, sought for bankruptcy protection in December 2009
or more than a year after LBHI and its other affiliates filed
their bankruptcy cases.
The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at
Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.
On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI.
The Bankruptcy Court has approved Barclays Bank Plc's purchase
of Lehman Brothers' North American investment banking and
capital markets operations and supporting infrastructure for
US$1.75 billion. Nomura Holdings Inc., the largest brokerage
house in Japan, purchased LBHI's operations in Europe for US$2
plus the retention of most of employees. Nomura also bought
Lehman's operations in the Asia Pacific for US$225 million.
International Operations Collapse
Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, was placed into administration,
together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE
Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to Lehman Brothers
International (Europe) on Sept. 15, 2008. The joint
administrators have been appointed to wind down the business.
Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan
Inc. filed for bankruptcy in the Tokyo District Court on
Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4
trillion (US$33 billion) in liabilities in its petition.
Judge James Peck on Aug. 30, 2011, approved the disclosure
statement, which outlines the major provisions of Lehman's
$65 billion liquidation plan. The proposed plan would enable LBHI
and its affiliated debtors to pay an estimated $65 billion to
their creditors. Voting on the Plan ends on Nov. 4, 2011. A
hearing to consider confirmation of the Plan is set for Dec. 6,
2011.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and other
insolvency and bankruptcy proceedings undertaken by its
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
LEHMAN BROTHERS: JPM Keeps Docs on $6.3BB Claim Dispute Under Seal
------------------------------------------------------------------
JPMorgan Chase Bank NA asked Judge James Peck to keep portions of
a $6.3 billion claim dispute with Lehman Brothers Holdings Inc.
under seal, saying it was necessary to protect highly
confidential and sensitive commercial information, according to
Hilary Russ of Law360.
The two sides had previously kept cloaked even more information
in the dispute, but they reached an agreement on Oct. 11 to allow
much of the information to be unsealed, the report related.
The claims stemmed from the alleged $6.3 billion deficiency
following the sale of collateral pledged by the brokerage to
secure its debt related to JPMorgan's role as repo custodian.
Fact discovery including depositions relating to the adversary
proceeding is to be completed by January 27, 2012.
About Lehman Brothers
Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was
the fourth largest investment bank in the United States. For
more than 150 years, Lehman Brothers has been a leader in the
global financial markets by serving the financial needs of
corporations, governmental units, institutional clients and
individuals worldwide.
Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy
petition disclosed US$639 billion in assets and US$613 billion in
debts, effectively making the firm's bankruptcy filing the
largest in U.S. history. Several other affiliates followed
thereafter.
Additional units, Merit LLC, LB Somerset LLC and LB Preferred
Somerset LLC, sought for bankruptcy protection in December 2009
or more than a year after LBHI and its other affiliates filed
their bankruptcy cases.
The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at
Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.
On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI.
The Bankruptcy Court has approved Barclays Bank Plc's purchase
of Lehman Brothers' North American investment banking and
capital markets operations and supporting infrastructure for
US$1.75 billion. Nomura Holdings Inc., the largest brokerage
house in Japan, purchased LBHI's operations in Europe for US$2
plus the retention of most of employees. Nomura also bought
Lehman's operations in the Asia Pacific for US$225 million.
International Operations Collapse
Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, was placed into administration,
together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE
Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to Lehman Brothers
International (Europe) on Sept. 15, 2008. The joint
administrators have been appointed to wind down the business.
Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan
Inc. filed for bankruptcy in the Tokyo District Court on
Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4
trillion (US$33 billion) in liabilities in its petition.
Judge James Peck on Aug. 30, 2011, approved the disclosure
statement, which outlines the major provisions of Lehman's
$65 billion liquidation plan. The proposed plan would enable LBHI
and its affiliated debtors to pay an estimated $65 billion to
their creditors. Voting on the Plan ends on Nov. 4, 2011. A
hearing to consider confirmation of the Plan is set for Dec. 6,
2011.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and other
insolvency and bankruptcy proceedings undertaken by its
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
LEHMAN BROTHERS: Gets Court Okay to Take Over Moonlight Basin
-------------------------------------------------------------
Lehman Brothers Holdings Inc. received court approval to take
over ownership of Moonlight Basin ski resort, according to Jess
Antonio of NBC Montana in an Oct. 28 report.
The ski resort has been in Chapter 11 bankruptcy since 2009.
Lehman Brothers loaned money to Moonlight in 2007.
"We've worked with them throughout the course of the [C]hapter 11
to effectuate a restructure, so they'll be the owners of
Moonlight Basin, they will be the source of capital for operation
of the project," Chief Operating Officer of Moonlight, Russ
McElye, told NBC Montana.
Mr. McElye says Lehman Brothers has helped the resort grow and
get stronger financially while it was bankrupt, the report
related.
"We've managed to maintain our employee base, grow the business
during the time of this bankruptcy, which is pretty remarkable,
and start doing things to position Moonlight to be more
successful in the future," he added, NBC Montana quoted.
Mr. McElye, according to the report, thinks sometimes lost in
bankruptcies is the number of people affected when a resort, like
Moonlight or more recently, Spanish Peaks, is forced to shut
down.
"I think in a bankruptcy often times people only focus on the
debtor and the creditor, but there's really a lot of other
stakeholders out there and in our case it's the community, we
want to protect our employees and then our customers and owners,"
the news agency quoted Mr. McElye as saying.
The report that there are two major hurdles left for the Lehman
takeover: first the two must close a deal and transfer all assets
to Lehman Brothers and second, the bankruptcy court must issue a
decree finalizing the process signaling that Moonlight Basin in
officially out of Chapter 11.
About Lehman Brothers
Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was
the fourth largest investment bank in the United States. For
more than 150 years, Lehman Brothers has been a leader in the
global financial markets by serving the financial needs of
corporations, governmental units, institutional clients and
individuals worldwide.
Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy
petition disclosed US$639 billion in assets and US$613 billion in
debts, effectively making the firm's bankruptcy filing the
largest in U.S. history. Several other affiliates followed
thereafter.
Additional units, Merit LLC, LB Somerset LLC and LB Preferred
Somerset LLC, sought for bankruptcy protection in December 2009
or more than a year after LBHI and its other affiliates filed
their bankruptcy cases.
The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at
Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.
On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI.
The Bankruptcy Court has approved Barclays Bank Plc's purchase
of Lehman Brothers' North American investment banking and
capital markets operations and supporting infrastructure for
US$1.75 billion. Nomura Holdings Inc., the largest brokerage
house in Japan, purchased LBHI's operations in Europe for US$2
plus the retention of most of employees. Nomura also bought
Lehman's operations in the Asia Pacific for US$225 million.
International Operations Collapse
Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, was placed into administration,
together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE
Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to Lehman Brothers
International (Europe) on Sept. 15, 2008. The joint
administrators have been appointed to wind down the business.
Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan
Inc. filed for bankruptcy in the Tokyo District Court on
Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4
trillion (US$33 billion) in liabilities in its petition.
Judge James Peck on Aug. 30, 2011, approved the disclosure
statement, which outlines the major provisions of Lehman's
$65 billion liquidation plan. The proposed plan would enable LBHI
and its affiliated debtors to pay an estimated $65 billion to
their creditors. Voting on the Plan ends on Nov. 4, 2011. A
hearing to consider confirmation of the Plan is set for Dec. 6,
2011.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and other
insolvency and bankruptcy proceedings undertaken by its
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
LEHMAN BROTHERS: Claims Trading Reach $10-Bil. in July-September
----------------------------------------------------------------
More than 2,000 claims totaling almost $10 billion changed hands
in the Debtors' bankruptcy cases for the period from July to
September 2011.
In July, more than 1,000 claims were traded, including about 500
claims filed by investors in Hong Kong represented by Standard
Chartered Bank (Hong Kong) Limited. Claims traded in July
totaled around $4 billion.
About 200 claims were traded in August, including a $339 million
claim of Bank of Scotland PLC transferred to Merrill Lynch Credit
Products, LLC. Claims that changed hands in August totaled more
than $1 billion.
September saw an increase in claims trading. This, according to
Bloomberg News, was partly because "people are now trading on the
time value of money," citing Andrew Gottesman, head of claims
trading at SecondMarket Inc.
More than 400 claims, totaling almost $5 billion, changed hands
in September.
Bloomberg said Lehman continues to dominate the claims-trading
business since May 2009. In September, Lehman by itself was
responsible for 97% of all claim trades reported to bankruptcy
courts, the news agency said. Bloomberg also pointed out that
trading in Lehman claims more than doubled from the month before,
even though the bankrupt investment bank is scheduled for a
confirmation hearing on Dec. 6 to wrap up the Chapter 11 case
begun in September 2008.
Claims traders have had months to analyze Lehman's disclosure
statement while projecting how much creditors will receive and
when, Bloomberg noted. Even late in a case where the facts are
out on the table for all to see, it's still possible to buy a
claim while having a "reasonable degree of certainty" about
making a profit, Mr. Gottesman said in an interview with
Bloomberg.
Much of the selling came from banks and financial institutions
that purchased claims earlier in the case, Mr. Gottesman said,
Bloomberg related. Given the weak third-quarter earnings
reported by some financial companies, banks may have been selling
to lock in profits and bolster earnings, the news agency opined.
About Lehman Brothers
Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was
the fourth largest investment bank in the United States. For
more than 150 years, Lehman Brothers has been a leader in the
global financial markets by serving the financial needs of
corporations, governmental units, institutional clients and
individuals worldwide.
Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy
petition disclosed US$639 billion in assets and US$613 billion in
debts, effectively making the firm's bankruptcy filing the
largest in U.S. history. Several other affiliates followed
thereafter.
Additional units, Merit LLC, LB Somerset LLC and LB Preferred
Somerset LLC, sought for bankruptcy protection in December 2009
or more than a year after LBHI and its other affiliates filed
their bankruptcy cases.
The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at
Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.
On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI.
The Bankruptcy Court has approved Barclays Bank Plc's purchase
of Lehman Brothers' North American investment banking and
capital markets operations and supporting infrastructure for
US$1.75 billion. Nomura Holdings Inc., the largest brokerage
house in Japan, purchased LBHI's operations in Europe for US$2
plus the retention of most of employees. Nomura also bought
Lehman's operations in the Asia Pacific for US$225 million.
International Operations Collapse
Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, was placed into administration,
together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE
Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to Lehman Brothers
International (Europe) on Sept. 15, 2008. The joint
administrators have been appointed to wind down the business.
Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan
Inc. filed for bankruptcy in the Tokyo District Court on
Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4
trillion (US$33 billion) in liabilities in its petition.
Judge James Peck on Aug. 30, 2011, approved the disclosure
statement, which outlines the major provisions of Lehman's
$65 billion liquidation plan. The proposed plan would enable LBHI
and its affiliated debtors to pay an estimated $65 billion to
their creditors. Voting on the Plan ends on Nov. 4, 2011. A
hearing to consider confirmation of the Plan is set for Dec. 6,
2011.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and other
insolvency and bankruptcy proceedings undertaken by its
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
LEHMAN BROTHERS: $1.442 Billion Already Paid to Advisors
--------------------------------------------------------
Lehman Brothers Holdings Inc. disclosed these cash receipts and
disbursements of the company, its affiliated debtors and
controlled entities for the month ended August 31, 2011:
Beginning Total Cash & Investments (09/01/11) $25,494,000,000
Total Sources of Cash 906,000,000
Total Uses of Cash (630,000,000)
FX Fluctuation (33,000,000)
---------------
Ending Total Cash & Investments (09/30/11) $25,737,000,000
LBHI reported $4.106 billion in cash and investments as of
September 1, 2011, and $4.225 billion as of September 30, 2011.
The monthly operating report also showed that a total of
$35,206,000 was paid last month to the U.S Trustee and
professionals that were retained in the Debtors' Chapter 11
cases.
From September 15, 2008 to September 30, 2011, a total of
$1,442,658,000 was paid to the U.S. Trustee and professionals, of
which $478,248,000 was paid to the Debtors' turnaround manager
Alvarez & Marsal LLC while $343,317,000 was paid to their
bankruptcy counsel, Weil Gotshal & Manges LLP.
A copy of the September 2011 Operating Report is available for
free at http://bankrupt.com/misc/LehmanMORSept3011.pdf
About Lehman Brothers
Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was
the fourth largest investment bank in the United States. For
more than 150 years, Lehman Brothers has been a leader in the
global financial markets by serving the financial needs of
corporations, governmental units, institutional clients and
individuals worldwide.
Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy
petition disclosed US$639 billion in assets and US$613 billion in
debts, effectively making the firm's bankruptcy filing the
largest in U.S. history. Several other affiliates followed
thereafter.
Additional units, Merit LLC, LB Somerset LLC and LB Preferred
Somerset LLC, sought for bankruptcy protection in December 2009
or more than a year after LBHI and its other affiliates filed
their bankruptcy cases.
The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at
Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.
On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI.
The Bankruptcy Court has approved Barclays Bank Plc's purchase
of Lehman Brothers' North American investment banking and
capital markets operations and supporting infrastructure for
US$1.75 billion. Nomura Holdings Inc., the largest brokerage
house in Japan, purchased LBHI's operations in Europe for US$2
plus the retention of most of employees. Nomura also bought
Lehman's operations in the Asia Pacific for US$225 million.
International Operations Collapse
Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, was placed into administration,
together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE
Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to Lehman Brothers
International (Europe) on Sept. 15, 2008. The joint
administrators have been appointed to wind down the business.
Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan
Inc. filed for bankruptcy in the Tokyo District Court on
Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4
trillion (US$33 billion) in liabilities in its petition.
Judge James Peck on Aug. 30, 2011, approved the disclosure
statement, which outlines the major provisions of Lehman's
$65 billion liquidation plan. The proposed plan would enable LBHI
and its affiliated debtors to pay an estimated $65 billion to
their creditors. Voting on the Plan ends on Nov. 4, 2011. A
hearing to consider confirmation of the Plan is set for Dec. 6,
2011.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and other
insolvency and bankruptcy proceedings undertaken by its
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
LEHMAN BROTHERS: European Administrators Have Earned GBP400MM
-------------------------------------------------------------
PricewaterhouseCoopers has earned more than GBP400 million from
its work on the administration of Lehman Brothers' London-based
business since it was appointed to handle the estate following
the US bank's collapse three years ago, Harry Wilson of the
Telegraph reported on Oct. 14.
In total, the accountancy firm has billed Lehman Brothers
International (Europe) GBP403 million and still has about 250
staff working on the complex resolution of the bank, the report
noted.
This fee, the report added, does not take into account the cost
of continuing to pay 495 former Lehman Brothers staff as well as
contractors who are helping with the winding up work. In the six
months to the end of June alone the payroll bill came to GBP33
million, the Telegraph pointed out.
Completing the work is expected to take at least 10 years, though
the costs are expected to fall as the main parts of the
administration are completed and the number of staff required to
work on the project falls, the report noted. An application will
be made to the UK High Court next month to extend the
administration period for a further five years, the news agency
related.
In particular, the set-up of a new IT system in the next couple
of months is expected to lead to a sharp reduction in the number
of people working on the administration, the report discloses.
Tony Lomas, the PwC partner in charge of the administration, said
he was hopeful that the estate could begin making its first
distribution to Lehman Brothers creditors next year, marking the
first time victims of the bank's collapse would see any return of
their money since its September 2008 bankruptcy, the Telegraph
said.
Mr. Lomas added that discussions with several major Lehman
affiliates that have made claims against the London-based
business had "materially progressed" in recent weeks, the report
said.
"In the coming months, a number of important legal appeals will
be heard in the UK Courts, including the Supreme Court
proceedings relating to Client Money. The outcome of these cases
will materially influence the value and timing of the eventual
recovery for ordinary unsecured creditors. Notwithstanding these
major, continuing difficulties, we remain hopeful of making a
first, interim distribution to creditors at some stage during
2012," the Telegraph said, citing Mr. Lomas.
In the past six months, GBP1.8 billion has been realized from the
sale of business's assets, taking the total raised since the
administration began to GBP12.6 billion, the report said.
However, the estate faces tens of billions of pounds of claims
from unsecured creditors reckoned at between GBP16.2 billion and
GBP52.5 billion. The wide range reflects the fact that many
claims have still to be processed.
No final bar date has been set for claims against Lehman Brothers
and PwC has cautioned that "other reserves may be necessary" to
meet any new claims against the business, the report noted.
About Lehman Brothers
Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was
the fourth largest investment bank in the United States. For
more than 150 years, Lehman Brothers has been a leader in the
global financial markets by serving the financial needs of
corporations, governmental units, institutional clients and
individuals worldwide.
Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy
petition disclosed US$639 billion in assets and US$613 billion in
debts, effectively making the firm's bankruptcy filing the
largest in U.S. history. Several other affiliates followed
thereafter.
Additional units, Merit LLC, LB Somerset LLC and LB Preferred
Somerset LLC, sought for bankruptcy protection in December 2009
or more than a year after LBHI and its other affiliates filed
their bankruptcy cases.
The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at
Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.
On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI.
The Bankruptcy Court has approved Barclays Bank Plc's purchase
of Lehman Brothers' North American investment banking and
capital markets operations and supporting infrastructure for
US$1.75 billion. Nomura Holdings Inc., the largest brokerage
house in Japan, purchased LBHI's operations in Europe for US$2
plus the retention of most of employees. Nomura also bought
Lehman's operations in the Asia Pacific for US$225 million.
International Operations Collapse
Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, was placed into administration,
together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE
Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to Lehman Brothers
International (Europe) on Sept. 15, 2008. The joint
administrators have been appointed to wind down the business.
Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan
Inc. filed for bankruptcy in the Tokyo District Court on
Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4
trillion (US$33 billion) in liabilities in its petition.
Judge James Peck on Aug. 30, 2011, approved the disclosure
statement, which outlines the major provisions of Lehman's
$65 billion liquidation plan. The proposed plan would enable LBHI
and its affiliated debtors to pay an estimated $65 billion to
their creditors. Voting on the Plan ends on Nov. 4, 2011. A
hearing to consider confirmation of the Plan is set for Dec. 6,
2011.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and other
insolvency and bankruptcy proceedings undertaken by its
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
LOS ANGELES DODGERS: Court Postpones Trial to November 29
---------------------------------------------------------
Reuters reports that Judge Kevin Gross, who oversees the Los
Angeles Dodgers bankruptcy,1 postponed four days of hearings that
would have helped determine if the team remained under the control
of owner Frank McCourt.
According to Reuters, the hearings were adjourned to Nov. 29,
2011, through Dec. 2, 2011. It did not say why it was postponed.
The hearings were scheduled to begin on Oct. 31, 2011.
Reuter notes Judge Gross scheduled the hearings on Sept. 30 to cut
through the "harsh allegations" in the case and reach a prompt
resolution so the team could use the off-season to prepare for the
2012 schedule.
Tom Hals at Reuters, citing court documents filed by Major League
Baseball on Oct. 25, 2011, reported Los Angeles Dodgers owner
Frank McCourt "looted" $190 million from the bankrupt team to fund
his lavish lifestyle, which includes eight homes.
According to Reuters, the league said Mr. McCourt took $61 million
from the team to pay personal debts, $73 million from team parking
revenue and $55 million from the team's untapped equity. "The
Dodgers are in bankruptcy because Mr. McCourt has taken almost
$190 million out of the club and completely alienated the Dodgers'
fan base," Reuters quoted the league as saying.
Mr. Hals said the Dodgers stated that the league's "inflammatory
allegations" were not supported by the evidence.
A four-day court hearing was scheduled to begin Oct. 31 to
determine the best way out of bankruptcy. Mr. McCourt and the
league's commissioner are expected to testify.
About 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. In its schedules, the LA Dodgers baseball club
disclosed $77,963,734 in assets and $4,695,702 in liabilities. LA
Real Estate LLC disclosed $161,761,883 in assets and $0 in
liabilities.
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. Public relations specialist Kekst and
Company has been hired for crisis support. Covington & Burling
LLP serves as special counsel.
An official committee of unsecured creditors has been appointed in
the case. The panel has tapped Lazard Freres & Co. as financial
adviser and investment banker, and Morrison & Foerster LLP and
Pinckney, Harris & Weidinger, LLC as counsel.
The LA Dodgers is the 12th sports team in North America to have
sought bankruptcy protection, according to The Wall Street
Journal.
The reorganization is being financed with a $150 million unsecured
loan from the Commissioner of Major League Baseball. The loan
gives the Commissioner few of the controls lenders often demanded
from bankrupt companies.
MADISON HOTEL: Files Ch. 11 Plan & Disclosure Statement
-------------------------------------------------------
Madison Hotel Owners, LLC, and its debtor affiliates filed with
the U.S. Bankruptcy Court for the Southern District of New York a
Chapter 11 plan of reorganization and an accompanying disclosure
statement.
Allowed Unsecured Claims, totaling $5,234,950, will be paid in
installments. Claimholders will receive 25% of the allowed amount
of the Claims in cash on the Effective Date, 25% on the 6-month
anniversary of the Effective Date, 25% on the 1-year anniversary
of the Effective Date, and 25% on the 18-month anniversary of the
Effective Date.
On the Effective Date, Madison Hotel LLC will be merged into
Madison Hotel Owners, LLC. The Debtors intend to fund the Plan
through cash on hand held by the receiver of the property located
at 62 Madison Avenue, in New York, operating revenue generated by
the operations of the Hotel and by additional amounts to be
advanced by CRP Holding SPA.
A full-text copy of the Disclosure Statement, dated Oct. 19, is
available for free at http://ResearchArchives.com/t/s?773d
About Madison Hotel
Madison Hotel, LLC, owns the 72 room 12-story hotel located at 62
Madison Avenue, New York, New York. Madison Hotel Owners LLC owns
100% of the membership interests of Madison Hotel, LLC. The
Debtors estimate that the value of the hotel property is
$32 million. An appraisal is pending.
Prepetition, after a building loan went into arrears, a
foreclosure action was commenced, and a receiver appointed. The
receiver has continued to operate the hotel postpetition.
Madison Hotel, LLC, based in New York, filed for Chapter 11
bankruptcy (Bankr. S.D.N.Y. Case No. 11-12560) on May 27, 2011.
Judge Martin Glenn presides over the case. Mark A. Frankel, Esq.,
at Backenroth Frankel & Krinsky, LLP, serves as bankruptcy
counsel. In its schedules, the Debtor disclosed $33.6 million in
assets and $26.1 million in liabilities as of the Chapter 11
filing.
MANISTIQUE PAPERS: Gets Final OK to Access $5-Mil. DIP Loan
-----------------------------------------------------------
Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District
of Delaware authorized Manistique Papers, Inc., on a final basis,
to access $5 million of debtor-in-possession financing from mBank,
as lender.
The Debtor sought authority to access the DIP loan to avoid being
immediately and irreparably harmed. The Debtor told the Court
that it may experience a significant reduction of the number of
customers or vendors willing to do business with them due to a
perceived lack of adequate liquidity of threatened long-term
viability.
A full-text copy of the Final DIP Order is available for free
at http://ResearchArchives.com/t/s?773e
About Manistique Papers
Manistique Papers Inc. operates a landfill in Manistique,
Michigan, whereby residuals resulting from paper production are
deposited. Manistique Papers filed for Chapter 11 bankruptcy
protection (Bankr. D. Del. Case No. 11-12562) on Aug. 12, 2011.
Godfrey & Kahn, S.C. represents the Debtor in its restructuring
effort. Morris, Nichols, Arsht & Tunnell LLP serves as its
Delaware bankruptcy co-counsel. Vector Consulting, L.L.C., serves
as its financial advisor. Baker Tilly Virchow Krause, LLC, serves
as its accountant.
The Official Committee of Unsecured Creditors appointed in the
Chapter 11 cases of Manistique Papers is represented by Lowenstein
Sandler PC as lead counsel and Ashby & Geddes, P.A., as Delaware
counsel. J.H. Cohn LLC serves as the panel's financial advisor. -
Manistique Papers disclosed $19,688,471 in assets and $24,633,664
in liabilities as of the Chapter 11 filing.
MERCED FALLS: U.S. Trustee Unable to Form Committee
---------------------------------------------------
The United States Trustee said that an official committee under 11
U.S.C. Sec. 1102 has not been appointed in the bankruptcy case of
Merced Falls Ranch LLC because an insufficient number of persons
holding unsecured claims against the Debtor have expressed
interest in serving on a committee. The U.S. Trustee reserves the
right to appoint such a committee should interest developed among
the creditors.
About Merced Falls
Merced Falls Ranch LLC filed a Chapter 11 petition (Bankr. E.D.
Calif. Case No. 11-19212) on Aug. 16, 2011, in Fresno, California.
The Debtor disclosed assets of $100 million to $500 million and
debts of $10 million to $50 million. Judge W. Richard Lee
presides over the case. Walter & Wilhelm Law Group serves as the
Debtor's bankruptcy counsel. Cappello and Noel LLP acts as
special litigation counsel. Atherton & Associates acts as
accountants. The petition was signed by Stephen W. Sloan, the
Debtor's member.
MF GLOBAL: Bankruptcy to Hand JC Flowers $47.8-Mil. Net Loss
------------------------------------------------------------
Ryan Dezember, writing for Dow Jones Newswires, reports that
financier J. Christopher Flowers was a significant investor in MF
Global Holdings Ltd. since 2008 through his private-equity firm
J.C. Flowers & Co. That summer the firm spent $87.4 million on a
dividend-paying stake in the brokerage, Dow Jones relates, citing
a person familiar with the matter.
The source told Dow Jones that over the last three years the
securities yielded the Flowers firm $39.6 million in dividends.
Now, according to Dow Jones, with MF Global filing for Chapter 11
bankruptcy protection, the fund is expected to mark the investment
down to nothing, meaning a net loss of $47.8 million for Flowers.
Dow Jones also relates the business relationship between Mr.
Flowers, 54 years old, and MF Global Chairman and Chief Executive
Jon Corzine, 64, dates back to when they were both stars at
Goldman Sachs Group Inc., where Mr. Corzine was once chairman.
Mr. Corzine is also an operating partner at J.C. Flowers, though a
person familiar with the matter said he is not expected to
continue in that role.
MOUNTAIN CITY: Gets Court Nod to Sell All Assets to MCM
-------------------------------------------------------
Judge Howard Tallman authorized Mountain City Meat Co., Inc., to
sell substantially all of its assets to MCM Acquisition Co., free
and clear of all claims and encumbrances.
The Debtor will first reserve from the sale proceeds all fees and
expenses identified in the Cash Collateral Order amounting to
$298,961, and such funds will be solely for the benefit of
bankruptcy professionals.
About Mountain City Meat
Denver, Colorado-based Mountain City Meat Co., Inc. --
http://www.mountaincitymeat.com/-- is one of the largest portion
control beef processors in the United States. Through its
headquarters and manufacturing facility in Denver, and its second
manufacturing facility in Nashville, Tennessee, Mountain City
supplies high quality ground beef and portion control steak cuts
through several channels, including retail stores, chain
restaurants and broadline food service distributors.
On Aug. 9, 2011, Mountain City's board of directors appointed BGA
Management LLC d/b/a Alliance Management, through its agent, Alex
G. Smith as the company's Chief Restructuring Officer until the
need for a CRO no longer existed. Immediately after appointing
Alliance as CRO, the Board resigned.
On Aug. 11, 2011, Mountain City's secured lender, Fifth Third Bank
commenced a receivership action against the company in Denver
District Court. At 5:00 p.m. that same day, the Denver District
Court appointed Alliance as receiver for Mountain City's personal
property and related operations.
However, minutes before the receivership order, certain putative
unsecured creditors -- Orleans International, Inc., National Beef
Packing, Inc. and XL Four Star Beef, Inc. -- commenced an
involuntary Chapter 7 bankruptcy petition (Bankr. D. Colo. Case
No. 11-29209) against Mountain City. The Involuntary Chapter 7
petition was filed as a result of, among other reasons, the Debtor
(a) ordering and not paying for in excess of $2,400,000 of meat
inventory from the Petitioning Creditors; and (b) issuing checks
to the Petitioning Creditors for a portion of the inventory, which
checks were refused for payment by Fifth Third Bank. The Debtor
sought dismissal of the Involuntary Petition on the grounds that
it was filed in bad faith because the Petitioning Creditors were
motivated solely by their desire to preserve their claims under
Section 503(b)((9) of the Bankruptcy Code to have that portion of
their claims related to goods sold to the Debtor within 20 days
prior to the filing treated as an administrative expense.
In the Involuntary Case, the Secured Lender obtained two interim
orders annulling the automatic stay to allow the receiver to keep
control of the Debtor.
Mountain City filed a voluntary Chapter 11 petition (Bankr. D.
Colo. Case No. 11-32656) on Sept. 24, 2011. Judge Howard R.
Tallman presides over the case. Michael J. Pankow, Esq., Daniel
J. Garfield, Esq., Heather B. Schell, Esq., at Brownstein Hyatt
Farber Schreck, LLP, represent the Debtors as counsel. The Debtor
estimated up to $50 million in assets and debts.
Attorneys for the Petitioning Creditors are John B. Wasserman,
Esq., at Sender & Wasserman, P.C., and Howard S. Sher, Esq., and
Michele L. Walton, Esq., at Jacob & Weingarten, P.C.
Fifth Third is represented in the case by James T. Markus, Esq.,
and John F. Young, Esq., at Markus Williams Young & Zimmermann
LLC.
An official committee of unsecured creditors has been appointed in
the case. The panel is represented by Harold G. Morris, Jr.,
Esq., and John C. Smiley, Esq., at Lindquist & Vennum PLLP.
NATE'S SEAFOOD: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Nate's Seafood & Steakhouse, Inc.
14951 Midway Rd
Addison, TX 75001
Bankruptcy Case No.: 11-36743
Chapter 11 Petition Date: October 24, 2011
Court: United States Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Harlin DeWayne Hale
Debtor's Counsel: Charles R. Chesnutt, III, Esq.
CHARLES R. CHESNUTT, P.C.
Three Lincoln Centre, Suite 1221
5430 LBJ Freeway
Dallas, TX 75240
Tel: (972) 248-7000
Fax: (972) 559-1872
E-mail: pleadings@chapter7-11.com
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 20 largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/txnb11-36743.pdf
The petition was signed by Nathan J. Peck, president.
NATIONAL ENVELOPE: Stuck With Polluted Plant, Requests Conversion
-----------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that National Envelope Corp., once the largest closely
held envelope manufacturer in the U.S., sold the business last
year, couldn't find a buyer for an environmentally contaminated
New Jersey plant, and filed papers for conversion of the Chapter
11 case to liquidation in Chapter 7 where a trustee is appointed
automatically.
Mr. Rochelle relates that NEC sold the business in September 2010
to Gores Group LLC under a contract with an advertised price of
$208 million, including cash of $149.85 million. NEC later
1settled disputes with Gores over adjustments in the price.
Despite what it called "tireless efforts," NEC couldn't find a
buyer for the plant in Union, New Jersey. Lacking even enough
cash to pay expenses that accrued during the Chapter 11 effort,
NEC said it doesn't have the resources to remediate the pollution
at the plant.
There will be a hearing on Nov. 15 in U.S. Bankruptcy Court in
Delaware to consider the motion for conversion to Chapter 7.
About NEC Holdings
Uniondale, New York-based National Envelope Corporation was
the largest manufacturer of envelopes in the world with
14 manufacturing facilities and 2 distribution centers and
approximately 3,500 employees in the U.S. and Canada.
NEC Holdings Corp., together with affiliates, including National
Envelope Inc., filed for Chapter 11 (Bankr. D. Del. Lead Case No.
10-11890) on June 10, 2010. Kara Hammond Coyle, Esq., at Young
Conaway Stargatt & Taylor LLP, serves as bankruptcy counsel to the
Debtors. David S. Heller, Esq., at Josef S. Athanas, Esq., and
Stephen R. Tetro II, Esq., at Latham & Watkins LLP, serve as
co-counsel. The Garden City Group is the claims and notice agent.
Bradford J. Sandler, Esq., and Robert J. Feinstein, Esq., at
Pachuiski Stang Ziehl & Jones LLP, represent the Official
Committee of Unsecured Creditors. Morgan Joseph & Co., Inc., is
the financial advisor to the Committee. NEC Holdings estimated
assets and debts of $100 million to $500 million in its Chapter 11
petition.
NB&J LLC: Case Summary & Largest Unsecured Creditor
---------------------------------------------------
Debtor: NB&J, LLC
dba Sleep Inn
2799 Airport Way
Boise, ID 83705
Bankruptcy Case No.: 11-03180
Chapter 11 Petition Date: October 24, 2011
Court: United States Bankruptcy Court
District of Idaho (Boise)
Judge: Terry L. Myers
Debtor's Counsel: Patrick John Geile, Esq.
FOLEY FREEMAN, PLLC
P.O. Box 10
Meridian, ID 83680
Tel: (208) 888-9111
Fax: (208) 888-5130
E-mail: pgeile@foleyfreeman.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
In its list of 20 largest unsecured creditors, the Company placed
only one entry:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Capital Matrix Hotel located at $1,014,943
1471 W Shoreline Dr# 123 2799 Airport Way,
Boise, ID 83702 Boise, Idaho
The petition was signed by Avtar Jassel, member/manager.
NELSON EDUCATION: Moody's Affirms 'B3' Corporate Family Rating
--------------------------------------------------------------
Moody's Investors Service revised Nelson Education Ltd.'s (Nelson)
outlook to stable from negative while affirming the company's B3
corporate family and probability of default ratings (CFR and PDR).
As part of the same action, Nelson's senior secured bank facility
rating was affirmed at B1 and its second lien term loan was
affirmed at Caa2.
The outlook action results from an updated liquidity assessment in
which a combination of modest top-line growth and reduced interest
expense (resulting from cash sweep repayments that have reduced
the loan principal and the maturity of a swap that was based on
historic interest rates that were higher than current market
norms) allows Nelson to generate modest free cash flow and grow
its cash balance. In turn, this may obviate the need for a
liquidity facility. While Nelson has never needed to draw on its
$50 million revolving term loan facility, the facility matures
July 13, 2013, and Moody's had previously expected that the
company's tepid financial performance and aggressive leverage
(over 9x, adjusted)would complicate refinance prospects. With
Nelson's first lien term loan maturing in July 2014, the potential
to operate without a committed bank revolver provides additional
time before refinance issues need to be addressed and allows the
outlook to be stabilized, although liquidity and refinance matters
will continue to be at the forefront of matters driving the rating
over the next year.
Issuer: Nelson Education Ltd.
Outlook Actions:
-- Outlook, Changed To Stable From Negative
Rating Actions:
-- Corporate Family Rating, Affirmed at B3
-- Probability of Default Rating, Affirmed at B3
-- Senior Secured Bank Credit Facility, Affirmed at B1 with the
loss given default assessment revised to LGD3, 31% from
LGD3, 32%
-- Senior Secured Second Lien Term Loan, Affirmed at Caa2 with
the loss given default assessment revised to LGD5, 84% from
LGD5, 85%
RATINGS RATIONALE
Nelson's B3 corporate family rating (CFR) primarily reflects the
company's aggressive financial profile in the context of a
relatively stable and sustainable cash flow profile that is also
characterized by modest capital intensity. Elevated leverage (over
9x, adjusted), limited potential to grow EBITDA, and possible debt
market conservatism are likely to adversely affect refinance
prospects. Consequently, liquidity and refinance activities are
likely to provide significant ratings influences between now and
the 2014 maturity of Nelson's first lien term loan.
Rating Outlook
The stable outlook is based on the premise that solid liquidity
planning can forestall pressure from refinance activities until
early/mid 2013, i.e. a year in advance of the maturity of the
company's term loan. In the interim, presuming positive free cash
flow and maintenance of sufficient cash to provide reasonable
liquidity, Moody's does not anticipate circumstances that would
mandate a ratings change.
What Could Change the Rating - Up
In view of the break-even to modestly positive levels of free cash
flow generation and the significant debt load, no upwards rating
migration is expected until Nelson demonstrates an ability to
generate sustainable levels of meaningful free cash flow and is
able to extend term debt maturities. .Quantitatively, the rating
could face upward rating pressure if Free Cash Flow/Debt were to
reach the mid-to-upper single digits, and free cash flow is used
to pay down debt such that Debt/EBITDA migrates under 7.0x (all
metrics as adjusted by Moody's).
What Could Change the Rating - Down
Nelson's near-term default risk is relatively low, given its
stable business profile and reasonable liquidity. However, should
liquidity or margins deteriorate or free cash flow generation turn
decidedly negative, ratings would likely face downward pressure.
Downward ratings migration is likely as term loan maturity dates
approach starting in mid-2014, unless satisfactorily refinanced
well in advance .
Nelson's ratings were assigned by evaluating factors that Moody's
considers relevant to the credit profile of the issuer, such as
the company's (i) business risk and competitive position compared
with others within the industry; (ii) capital structure and
financial risk; (iii) projected performance over the near to
intermediate term; and (iv) management's track record and
tolerance for risk. Moody's compared these attributes against
other issuers both within and outside Nelson's core industry and
believes Nelson's ratings are comparable to those of other issuers
with similar credit risk. Other methodologies used include Loss
Given Default for Speculative-Grade Non-Financial Companies in the
U.S., Canada and EMEA published in June 2009.
Corporate Profile
Headquartered in Toronto, Ontario, Canada, Nelson Education Ltd.
(Nelson) is a privately owned leading provider of publishing
services for the Canadian educational market. The company is a
joint venture owned by OMERS Capital Partners and Apax Partners.
NICK REYNOLDS: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Nick Reynolds Corporation
4161 E. Admiral Place
Tulsa, OK 74115
Bankruptcy Case No.: 11-13063
Chapter 11 Petition Date: October 23, 2011
Court: United States Bankruptcy Court
Northern District of Oklahoma (Tulsa)
Judge: Dana L. Rasure
Debtor's Counsel: Chad J. Kutmas, Esq.
MCDONALD, MCCANN & METCALF, LLP
15 E. Fifth Street, Suite 1800
Tulsa, OK 74103
Tel: (918) 430-3700
Fax: (918) 430-3770
E-mail: ckutmas@mmmsk.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 20 largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/oknb11-13063.pdf
The petition was signed by Nick Reynolds, president.
Debtor-affiliate that filed separate Chapter 11 petition:
Petition
Debtor Case No. Date
------ -------- ----
Reynolds Funeral Service, L.L.C. 11-13062 10/24/11
NORTHGATE CROSSING: Court Denies Approval of Disclosure Statement
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California
has denied the disclosure statement describing Northgate Crossing
LLC's Chapter 11 Plan of Reorganization.
Peter C. Anderson, the United States Trustee for Region 16,
objected to the approval of the disclosure statement, citing:
* The disclosure statement does not provide adequate information
regarding the proposed equity contribution.
* In the event the Plan does not pay all claims in full and a
cramdown is necessary, the Debtor's existing interest holders must
contribute substantial new value to justify the retention of their
interests.
* The Plan does not provide equal treatment to all claims and
unfairly discriminates.
* The Plan creates an enforcement injunction that suspends and
delays collection efforts against the guarantors until all plan
payments have been paid, estimated as the fourth quarter of
2021, and all allowed claims satisfied, unless there is a plan
default or dismissal or conversion of the case, in violation of
Section 524(e) of the bankruptcy code.
* The disclosure statement lacks adequate information concerning
post-confirmation sales without court approval.
Pursuant to the Plan terms, the Debtor will make all payments due
under the Plan to holders of Allowed Claims out of the Equity
Contribution, Net Sales Proceeds from the sale of parcels of the
Project, Development Agreement Proceeds, Net Cash Flow from the
Project, if any, and Refinance Proceeds, if any.
A full-text copy of the Aug. 3 Disclosure Statement is available
for free at http://bankrupt.com/misc/NORTHGATE_DSAug3.PDF
About NorthGate Crossing
NorthGate Crossing LLC owns and plans to develop a roughly 88-acre
mixed use tract of real property located in the city of Indio,
Riverside County, California. The planned project includes
commercial retail spaces, single family residences and a hotel.
NorthGate Crossing LLC, c/o Oresund Capital LLC, filed for Chapter
11 bankruptcy (Bankr. C.D. Calif. Case No. 11-24944) on May 5,
2011. Judge Scott C. Clarkson presides over the case. The Debtor
is represented by Richard H. Golubow, Esq., at Winthrop Couchot,
as bankruptcy counsel. In its Schedules, the Debtor disclosed
assets of $27,502,421 and debts of $29,015,903.
NUTRITION 21: Court Sets November 3 Sale Order Hearing
------------------------------------------------------
On Oct. , 2011, the U.S. Bankruptcy Court for the Southern
District of New York approved the bidding procedures for the
potential sale of all or substantially all of the assets of
Nutrition 21, Inc., and Nutrition 21, LLC.
The Debtors are authorized to grant a stalking horse bidder a
break-up fee and expense reimbursement in an amount not to
exceed 3.0% of the of the cash purchase price of the Purchased
Assets and reimbursement for direct out of pocket expenses of up
to $100,000.
The Sale Order Hearing will be held on Nov. 3, 2011, at 10:00 a.m.
A copy of the approved bidding procedures is available for free
at http://bankrupt.com/misc/nutrition21.approvedbidprotocol.pdf
About Nutrition 21
Purchase, N.Y.-based Nutrition 21, Inc. --
http://www.nutrition21.com/-- is a nutritional bioscience company
that primarily develops and markets raw materials, formulations,
compounds, blends and bulk and other materials to third-party non-
end users to be further fabricated, blended or packaged for
ultimate sales to end-users as nutritional supplements or
otherwise. The Company holds more than 30 patents for nutrition
products and their uses.
Nutrition 21 and its debtor affiliates filed for Chapter 11
bankruptcy (Bankr. S.D.N.Y. Lead Case No. 11-23712) on Aug. 26,
2011. Michael Friedman, Esq., and Keith N. Sambur, Esq., at
Richards Kibbe & Orbe LLP, serve as the Debtors' counsel.
The Company entered into a Plan Support Agreement, dated as of
Aug. 26, 2011, with holders of approximately 90% of the Company's
outstanding Series J Preferred Stock. The holders of Series J
Preferred Stock that are parties to the Plan Support Agreement
have agreed, subject to certain conditions, to vote in favor of a
plan of reorganization to be proposed by the Company in respect of
the Bankruptcy Case, so long as that plan is consistent with the
term sheet attached to the Plan Support Agreement setting forth
material terms of a potential plan of reorganization. The Plan
Term Sheet generally contemplates that the Debtors' assets will be
sold or liquidated and distributed to holders of claims and equity
interests in accordance with the statutory distribution and
priority scheme established by the Bankruptcy Code. The Plan Term
Sheet further contemplates that holders of the Company's common
stock will receive interests in a liquidating trust entitling such
holders to distributions only after holders of the Series J
Preferred Stock have been paid in full. The Company believes that
cash distributions on account of the Company's common stock are
unlikely.
OPEN RANGE: U.S. Trustee Appoints 7-Member Creditors' Panel
-----------------------------------------------------------
Roberta A. DeAngelis, the United States Trustee for Region 3,
pursuant to 11 U.S.C. Sec. 1102(a) and (b), appointed seven
unsecured creditors to serve on the Official Committee of
Unsecured Creditors of Open Range Communications Inc.
The Creditors Committee members are:
1. Velocitel, Inc.
ATTN: Thor Erickson
2415 Campus Dr., Suite 200
Irvine CA 92612,
Tel: (949) 809-4999
Fax: (949) 724-8570
2. Cloud 10 Corp
ATTN: Chris Kendall
4700 Syracuse Parkway, Suite 1000
Denver CO 80237
Tel: (303) 952-3252
Fax: (303) 952-3235
3. Statera Inc.
ATTN: Carl Fitch
6501 E. Belleview Avenue #300
Englewood CO 80111
Tel: (720) 346-0070
Fax: (720) 221-0892
4. BCI Communications Inc.
ATTN: Steven Mark
18-01 Pollitt Drive
Fair Lawn NJ 07410,
Tel: (267) 464-1722
Fax: (484) 948-1567
5. Frontera Consulting
ATTN: John Lee
120 Riverside Blvd., Suite 14T
New York NY 10069
Tel: (917) 549-9699
Fax: (9170 720-9041
6. SBA Properties Inc., SBA Towers II, LLC, SBA Structures,
Inc.; SBA Towers, LLC; SBA Infrastructure, LLC; SBA
Sites, Inc.; SBA Site Management, LLC; SBA Steel,
LLC and SBA Towers III, LLC
ATTN: Jacalyn Shapiro
5900 Broken Sound Parkway NW
Boca Raton FL 33487-2797
Tel: (561) 226-9268
Fax: (561) 998-3448
7. 52 Eighty LLC
ATTN: George Alex
158 Boston Post Road
Weston MA 02493
Tel: (508) 243-8543
Fax: (781) 923-1133
About Open Range
Greenwood Village, Colo.-based Open Range Communications Inc., a
provider of wireless broadband services to 26,000 rural customers
in 12 states, filed a Chapter 11 petition (Bankr. D. Del. Case No.
11-13188) on Oct. 6, 2011, to either sell the business or shut
down and liquidate. Open Range listed about $114 million in
assets and $110 million in debts. Open Range started its WiMax
broadband and voice service in late 2009, backed by a $267 million
loan from the U.S. Department of Agriculture's Rural Utility
Service and $100 million invested by One Equity Partners, a
financing arm of JPMorgan Chase & Co.
Judge Kevin J. Carey presides over the case. Marion M. Quirk,
Esq., at Cole, Schotz, Meisel, Forman & Leonard, serves as
bankruptcy counsel. Logan & Co. serves as claims agent. The
petition was signed by Chris Edwards, chief financial officer.
PENINSULA HOSPITAL: 50 Workers Gets Layoff Notifications
--------------------------------------------------------
Jaimie Oh at Becker's Hospital Review, citing report from New York
Daily News, says more than 50 employees at Peninsula Hospital in
Far Rockaway, New York, have received layoff notifications.
According to the report, in September, Brooklyn-based Revival Home
Health Care announced it would operate Peninsula Hospital and
extended an $8 million line of credit to the hospital to keep it
open.
The report adds those who received layoff notifications include
nurses, X-ray technicians and respiratory therapists.
About Peninsula Hospital
Wayne S. Dodakian, Vinod Sinha, and Shannon Gerardi filed an
involuntary Chapter 11 bankruptcy protection against Peninsula
Hospital Center -- http://www.peninsulahospital.org/-- (Bankr.
E.D.N.Y. Case No. 11-47056) on Aug. 16, 2011. Judge Elizabeth S.
Stong presides over the case. Marilyn Cowhey Macron, Esq., Macron
& Cowhey, represents the petitioners.
Peninsula Hospital Center and Peninsula General Nursing Home
Corp., employed Alvarez & Marsal Healthcare Industry Group, LLC,
as financial advisors. Deborah J. Piazza, Esq., at Abrams,
Fensterman, Fensterman, Eisman, Greenberg, Formato & Einiger, LLP,
in New York, N.Y., represent the Debtors as counsel. Judge Stong
appointed Daniel T. McMurray at Focus Management Group as patient
care ombudsman.
The Debtors have tapped Garden City Group, Inc. as claims and
noticing agent.
Tracy Hope Davis, the United States Trustee for Region 2,
appointed five unsecured creditors to serve on the Official
Committee of Unsecured Creditors of Peninsula Hospital Center.
The Official Committee of Unsecured Creditors of Peninsula
Hospital Center has tapped Arent Fox LLP as its attorneys.
The Debtor listed $22,846,994 in assets and $34,476,885 in
liabilities.
PENINSULA HOSPITAL: Names Thomas Egan as Chief Financial Officer
----------------------------------------------------------------
Jaimie Oh at Becker's Hospital Review, citing report from New York
Daily News, notes that Peninsula Hospital has named Thomas Egan as
new chief financial officer.
According to the report, the announcement comes as the hospital
and its new owner Brooklyn-based Revival Home Health Care undergo
Chapter 11 bankruptcy proceedings and financial restructuring.
The report notes, in late September, Todd Miller was named CEO and
chief restructuring officer, replacing former CEO Robert Levine,
who resigned amid sharp criticisms and accusations of trying to
speed up the closure process of the financially strapped hospital.
About Peninsula Hospital
Wayne S. Dodakian, Vinod Sinha, and Shannon Gerardi filed an
involuntary Chapter 11 bankruptcy protection against Peninsula
Hospital Center -- http://www.peninsulahospital.org/-- (Bankr.
E.D.N.Y. Case No. 11-47056) on Aug. 16, 2011. Judge Elizabeth S.
Stong presides over the case. Marilyn Cowhey Macron, Esq., Macron
& Cowhey, represents the petitioners.
Peninsula Hospital Center and Peninsula General Nursing Home
Corp., employed Alvarez & Marsal Healthcare Industry Group, LLC,
as financial advisors. Deborah J. Piazza, Esq., at Abrams,
Fensterman, Fensterman, Eisman, Greenberg, Formato & Einiger, LLP,
in New York, N.Y., represent the Debtors as counsel. Judge Stong
appointed Daniel T. McMurray at Focus Management Group as patient
care ombudsman.
The Debtors have tapped Garden City Group, Inc. as claims and
noticing agent.
Tracy Hope Davis, the United States Trustee for Region 2,
appointed five unsecured creditors to serve on the Official
Committee of Unsecured Creditors of Peninsula Hospital Center.
The Official Committee of Unsecured Creditors of Peninsula
Hospital Center has tapped Arent Fox LLP as its attorneys.
The Debtor listed $22,846,994 in assets, and $34,476,885 in
liabilities.
PLATEAU ENERGY: Grand Valley Bank Wins Permission to Foreclose
--------------------------------------------------------------
Bankruptcy Judge Michael E. Romero granted the request of Grand
Valley Bank for relief from the automatic stay in the bankruptcy
case of Plateau Energy Partners LLC, saying the Debtor has failed
to satisfy its burdens of proof as required by 11 U.S.C. Sec.
362(g).
Plateau Energy Partners LLC was formed in 2008 for the purpose of
acquiring, owning, and developing certain oil and gas and mineral
interests located in the Pieceance Basin, near Grand Junction in
Mesa County, Colorado. It has the right to conduct oil and gas
exploration operations on roughly 1,400 acres of Mesa County real
property pursuant to 43 oil and gas leases. The Leases are
unencumbered and are the only scheduled assets of any
significance, estimated to have a fair market value of roughly $3
million. The Debtor is a limited liability company and Randall K.
Walck and Cindi A. Walck are its managing members.
Included in the Leases is a particular oil and gas lease, dated
March 18, 2008, for roughly 240 acres of the Mesa County property.
The Property is owned by the Walcks and serves as collateral for a
loan owed by the Walcks to the Bank, on which Plateau Energy is a
co-obligor. Plateau Energy has no right, title, or interest in or
to the Property other than the March Lease.
As of the Petition Date, Plateau Energy owed the Bank $2,700,558.
The amount due continues to accrue interest at the rate of
$1,211.89 per day. Plateau Energy has not made any payments
against the Debt since the Petition Date.
The parties agree the Bank's foreclosure on the Property would
eliminate the March Lease as well as two corresponding surface
agreements providing for access to the Property. The parties
further agree the loss of that lease would have a catastrophic
effect on all of Plateau Energy's remaining leases. The Bank
believes its foreclosure may be subject to the automatic stay
under Sec. 362(a)(3).
A copy of the Court's Oct. 28, 2011 Order is available at
http://is.gd/kqp6HFfrom Leagle.com.
Plateau Energy Partners LLC filed for Chapter 11 bankruptcy (Bankr
D. Colo. Case No. 11-13182) on Feb. 22, 2011. The petition was
filed pro se. Plateau Energy listed under $1 million in assets
and debts.
PLAYPOWER INC: Moody's Assigns 'Caa1' Corporate Family Rating
-------------------------------------------------------------
Moody's Investors Service assigned a Caa1 Corporate Family Rating
and a Caa1 Probability of Default Rating to PlayPower, Inc.
Moody's also assigned a Caa1 rating to the company's $121.4
million Second Lien Secured Term Loan. The rating outlook is
stable.
The proceeds from the second lien term loan together with $10
million of borrowings under an unrated $25 million revolving
credit facility, about $20 million of unrated PIK Notes
contributed by its financial sponsor, Apollo Investment and a $25
million equity investment from Apollo were used earlier this year
to repay the existing prior revolver and term loan. This
transaction was done as part of the debt restructuring completed
in June 2011. Apollo owns 100% of the company following the
restructuring.
PlayPower provides recreational products of commercial playground
equipment, park amenities and marine accessories. The company's
primary markets are the United States and Europe.
RATING RATIONALE
The Caa1 Corporate Family Rating reflects PlayPower's weak credit
metrics with debt/EBITDA over 7.0 times (including $36 million of
unrated PIK notes held by Apollo) and the discretionary nature of
its product offerings. The ratings are also constrained by
PlayPower's modest scale with revenue less than $250 million,
moderate cushion under its financial covenants, limited product
diversification and exposure to macroeconomic volatility. A
significant portion of Playpower's US sales are to local
municipalities and school systems, and represent a deferrable
purchase in difficult fiscal times. The company's geographic
diversification within the United States and cost containment
initiatives support the rating. The rating benefits from having
most of its European operations in Nordic countries and the United
Kingdom, neither of which have experienced the type of turmoil
seen in Southern Europe. However, the rating is still constrained
by the exposure to countries in Southern Europe.
"The stable outlook reflects Moody's belief that revenue will stay
at about the same level or increase slightly over the next 12 to
18 months and that PlayPower will continue to proactively manage
its cost structure," said Kevin Cassidy, Senior Credit Officer at
Moody's Investors Service.
An upgrade in the ratings is unlikely in the near-term given
PlayPower's small scale and soft credit metrics. Over the longer
term, the ratings could be upgraded if the macroeconomic
uncertainty subsides, more cushion is obtained in its financial
covenants, revenue exceeds $300 million and credit metrics
strengthen. Key metrics necessary for an upgrade include higher
sustained free cash flow generation, EBITA/interest greater than
1.5 times, and debt-to-EBITDA below 6.0 times.
A downgrade could be considered if macroeconic conditions further
deteriorate negatively impacting the outlook for sales and
earnings, or if liquidty weakens. Tightening in the cushion under
its financial covenants, which is currently less than 20%, is one
of the liquidity concerns. Key credit metrics which could prompt a
downgrade would be the continuation of negative free cash flow or
EBITA/interest remaining below 1.0 times for a sustained period.
PlayPower's modest liquidity profile is based on less than $10
million of cash, modest free cash flow generation and the moderate
cushion under its financial covenants. Its liquidity profile
benefits from having no near term debt maturities (revolver
expires in June 2015 and 2nd lien term loan matures in June 2015)
and having access to a $25 million revolver.
Ratings assigned:
Corporate Family Rating at Caa1;
Probability of Default rating at Caa1;
$121.4 million Second Lien Term Loan maturing in June 30, 2015, at
Caa1 (LGD 3, 45%)
For additional information, please refer to Moody's Credit Opinion
of PlayPower published on Moodys.com.
The principal methodology used in rating PlayPower Inc. was the
Global Consumer Durables rating methodology published in October
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. Please see the Credit Policy page on
www.moodys.com for a copy of these methodologies.
PlayPower, based in Huntersville, North Carolina, provides
recreational products of commercial playground equipment, park
amenities and marine accessories. The company's primary markets
are the United States and Europe. The company distributes its play
systems under the Miracle Recreation, Hags Play, SoftPlay, Little
Tikes, SMP and Record RSS product lines, and its rotationally
molded self-floating dock and lift system under the EZ Dock line.
PlayPower generated roughly $240 million of revenue for the twelve
months ending June 30, 2011.
PRECISION PARTS: Plan Gets Approval at Oct. 28 Confirmation
-----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Precision Parts International Services Corp. received
approval for a liquidating Chapter 11 plan at the conclusion of an
Oct. 28 confirmation hearing. Creditor classes entitled to vote
all said "yes" to the plan. Unsecured creditors were told in the
disclosure statement that they could expect to recover between
0.15% and 0.35% on their $103 million in claims.
PPI sold its assets in March 2009, producing net proceeds of
$16 million. Secured lenders received $9.8 million immediately.
Mr. Rochelle relates that the plan was the product of a settlement
where secured lenders carved out $575,000 for creditors with lower
priorities. In addition to $150,000 cash, unsecured creditors are
to receive some recoveries from lawsuits, plus excess cash, if
any.
About Precision Parts
Headquartered in Rochester Hills, Michigan, Precision Parts
International Services Corp. -- http://www.precisionparts.com/--
sold products to major north American automotive and non-
automotive original equipment manufacturers and Tier 1 and 2
suppliers. PPI and its units operated six manufacturing
facilities throughout North America, including a facility in
Mexico operated on their behalf by Intermex Manufactura de
Chihuahua under a shelter and logistics agreement.
The Company and eight of its affiliates filed for Chapter 11
protection (Bankr. D. Del. Lead Case No. 08-13289) on Dec. 12,
2008. Attorneys at Pepper Hamilton LLP serve as the Debtors'
bankruptcy counsel. Alvarez & Marsal North America LLC is the
Debtor's financial advisors and Kurtzman Carson Consultants LLC is
the claims, noticing and balloting agent. PPI Holdings, Inc.,
estimated assets and debts between $100 million and $500 million
in its Chapter 11 petition.
Attorneys at Stevens & Lee, P.C., represent the Creditors
Committee as counsel.
On March 13, 2009, the Bankruptcy Court approved the sale of
substantially all of the Debtors' assets to Cerion LLC. The sale
closed on March 26, 2009. The Debtors received net proceeds of
$16,031,508 after an agreed upon working capital adjustment.
PROTECTIVE PRODUCTS: Court Confirms Unsecured Creditors' Plan
-------------------------------------------------------------
The U.S. Bankruptcy court for the Southern District of Florida
entered, on Oct. 5, 2011, an order confirming the third amended
plan of liquidation for PPOA Holding, Inc. f/k/a Protective
Products of America, Inc., et al., proposed by the Official
Committee of Unsecured Creditors.
The Court will conduct a post-confirmation status conference on
Dec. 13, 2011, at 10:30 a.m.
The Committee Plan
As reported in the Troubled Company Reporter on Jan. 3, 2011, the
Plan proposed by the Committee provides for, among other things,
the collection of the Debtors' portion of certain income tax
refunds, the pursuit of certain litigation, including but not
limited to avoidance actions and causes of action, and the
distribution of the Creditor Trust Assets.
Under the Plan, holders of general unsecured claims will receive a
pro rata share of cash proceeds of the Creditor Trust Assets. The
cash available to pay allowed general unsecured claims is provided
from the liquidation of all of the Creditor Trust Assets. The
Committee estimates that the actual recovery for holders of
allowed general unsecured claims will be approximately $2,669,559.
The Committee believes that the recovery pursuant to the Plan is
more than the recovery the holders would realize upon liquidation
of these cases under chapter 7 of the Bankruptcy Code. The
Committee also believes that the additional administrative
expenses of a chapter 7 trustee and its professionals would
dilute the distribution available to general unsecured creditors.
A full text copy of the Committee's Plan Outline is available for
free at:
http://bankrupt.com/misc/PROTECTIVEPRODUCTS_CreditorsDS.pdf
About Protective Products of America, Inc.
Sunrise, Florida-based Protective Products of America, Inc.,
formerly known as Ceramic Protection Corporation --
http://www.protectiveproductsofamerica.com/-- engages in the
design, manufacture and marketing of advanced products used to
provide ballistic protection for personnel and vehicles in the
military and law enforcement markets.
The Company filed for Chapter 11 bankruptcy protection on
Jan. 13, 2010 (Bankr. S.D. Fla. Case No. 10-10711). The Company's
affiliates -- PC Holding Corporation of America; Ceramic
Protection Corporation of America; Protective Products
International Corp.; and Protective Products of North Carolina,
LLC -- also filed separate Chapter 11 petitions. Protective
Products disclosed $86,678,781 in assets and $27,460,502 in
liabilities as of the Petition Date.
Debi Evans Galler, Esq, and Jordi Guso, Esq., at Berger Singerman,
in Miami, Fla., represents the Debtors as counsel.
Glenn D. Moses, Esq., at Genovese Joblove & Battista, P.A., in
Miami, Fla., and Heather L. Harmon, Esq., at Genovese Joblove &
Battista, P.A., in Miami, Fla., represent the Official Committee
of Unsecured Creditors as counsel.
QIMONDA AG: 11 U.S.C. Sec. 365(n) Applies to U.S. Patents
---------------------------------------------------------
Bankruptcy Judge Stephen S. Mitchell said public policy, as well
as the economic harm that would otherwise result to the licensees,
requires that the protections of 11 U.S.C. Sec. 365(n) apply to
Qimonda A.G.'s U.S. patents. Before the court -- on remand from
the United States District Court -- is the motion of Dr. Michael
Jaffe, the foreign representative in the cross-border insolvency
case, to modify a Supplemental Order to eliminate or restrict the
applicability of Sec. 365. Qimonda's assets include roughly
10,000 patents, of which roughly 4,000 are U.S. patents. The
motion is opposed by seven licensees of the debtor's U.S. patents:
Samsung Electronics Co., Ltd., Infineon Technologies AG, Micron
Technology, Inc., Nanya Technology Corporation, International
Business Machines Corp., Hynix Semiconductor Inc., and Intel
Corporation. The issues to be resolved are (a) whether the
failure of German insolvency law to afford patent licensees the
protections they would enjoy under Sec. 365(n) is "manifestly
contrary" to the public policy of the United States; and (b)
whether the licensees of the debtor's United States patents are
"sufficiently protected" if they are not accorded those
protections.
Judge Mitchell added that nothing in the court's ruling affects
the foreign administrator's right, to the extent permitted under
German insolvency law, to terminate licenses to non-U.S. patents.
A copy of Judge Mitchell's Oct. 28, 2011 Memorandum Opinion is
available at http://is.gd/CEbwwLfrom Leagle.com.
About Qimonda AG
Qimonda AG (NYSE: QI) -- http://www.qimonda.com/-- was a global
memory supplier with a diversified DRAM product portfolio. The
Company generated net sales of EUR1.79 billion in financial year
2008 and had -- prior to its announcement of a repositioning of
its business -- roughly 12,200 employees worldwide, of which 1,400
were in Munich, 3,200 in Dresden and 2,800 in Richmond, Va.
Qimonda AG commenced insolvency proceedings in a local court in
Munich, Germany, on Jan. 23, 2009. On June 15, 2009, QAG filed
a petition (Bankr. E.D. Va. Case No. 09-14766) for relief under
Chapter 15 of the U.S. Bankruptcy Code.
Qimonda North America Corp., an indirect and wholly owned
subsidiary of QAG, is the North American sales and marketing
subsidiary of QAG. QNA is also the parent company of Qimonda
Richmond LLC. QNA and QR sought Chapter 11 protection (Bankr.
D. Del. Case No. 09-10589) on Feb. 20, 2009. Mark D. Collins,
Esq., Michael J. Merchant, Esq., and Lee E. Kaufman, Esq., at
Richards Layton & Finger PA, in Wilmington Delaware; and Mark
Thompson, Esq., Morris J. Massel, Esq., and Terry Sanders, Esq.,
at Simpson Thacher & Bartlett LLP, in New York City, represent the
Debtors as counsel. Roberta A. DeAngelis, the United States
Trustee for Region 3, appointed seven creditors to serve on an
official committee of unsecured creditors. Jones Day and Ashby &
Geddes represent the Committee. In its bankruptcy petition,
Qimonda Richmond, LLC, estimated more than US$1 billion in assets
and debts. The information, the Chapter 11 Debtors said, was
based on QR's financial records which are maintained on a
consolidated basis with QNA.
In September 2011, the Chapter 11 Debtors won confirmation of
their Chapter 11 liquidation plan which projects that unsecured
creditors with claims between $33 million and $35 million would
have a recovery between 6.1% and 11.1%. No secured claims of
significance remained.
QUALTEQ INC: Bank of America Opposes $4.5 Million Loan
------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Bank of America NA filed court papers contending that
the proposed $4.5 million loan to QualTeq Inc. will give the
company no "substantial benefit" while the purpose of the
financing is to relieve company insiders of their guarantees on
existing debt owed to Sterling National Bank, the putative lender.
According to the report, Bank of America argued in papers filed on
Oct. 27 that QualTeq won't benefit because $3.7 million of the new
debt will be used to pay off an existing debt to New York-based
Sterling.
The hearing to consider approval of the financing is scheduled for
Nov. 3 in U.S. Bankruptcy Court in Delaware.
Charlotte, North Carolina-based Bank of America says it's an
interested party in the QualTeq case because it has $43 million in
judgments against Pethinaidu Veluchamy, the company's founder.
Mr. Rochelle notes that according to court filings, several
creditors obtained judgments against the founder, followed by
"multiple other creditors" who "obtained multimillion dollar
judgments against the founder and/or his wife."
About QualTeq Inc.
South Plainfield, New Jersey-based QualTeq, Inc., engages in the
design, manufacture, and personalization of plastic cards in the
United States. The company manufactures magnetic, contact, and
dual interface smart cards.
Qualteq Inc. and 17 affiliated companies filed for Chapter 11
bankruptcy protection (Bankr. D. Del. Lead Case No. 11-12572) on
Aug. 14, 2011. Eric Michael Sutty, Esq., and Jeffrey M. Schlerf,
Esq., at Fox Rothschild LLP, serve as local counsel to the
Debtors. K&L Gates LLP is the general bankruptcy counsel.
Scouler & Company is the restructuring advisors. QualTeq
estimated assets of up to $50 million and debts of up to
$100 million as of the Chapter 11 filing.
Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed four
unsecured creditors to serve on the Official Committee of
Unsecured Creditors.
RADIOSHACK: Fitch Lowers Long-Term Issuer Default Rating to 'B+'
----------------------------------------------------------------
Fitch Ratings has downgraded its long-term Issuer Default Rating
(IDR) for RadioShack to 'B+' from 'BB.' The Rating Outlook is
Negative. As of Sept. 30, 2011, RadioShack had $666 million of
debt outstanding.
The downgrade reflects weaker-than-anticipated operating results,
increased leverage as well as a more shareholder friendly posture
at a time when the trends in the business are exhibiting more
instability than prior periods. The recent declines in EBITDA are
more pronounced than expected, and Fitch believes there is greater
uncertainty in the business. Total lease adjusted leverage stood
at approximately 4.1 times (x) at the end of 2010. Fitch now
expects leverage to be in the 5x area for the near-to-intermediate
term. The Negative Outlook reflects the lack of stability in the
business as exhibited by declining operating profit levels.
RadioShack's comparable store sales decline of 4.1% and the 32%
fall in EBITDA for the nine-month period ended Sept. 30, 2011 are
among the weakest measures in the retail sector thus far in 2011.
Of RadioShack's three key product platforms, two are in decline
(signature and consumer electronics). Fitch estimates that
approximately half of revenues and 60% of gross margin dollars
come from signature and consumer electronics. The third platform,
mobility, is up 1.6% for the nine months ended Sept. 30, 2011, yet
performance is more sluggish than anticipated. The mobility
platform is a lower-margin business operating in a competitive
space where other larger players in the consumer electronics
sector (such as Best Buy and Staples) are ramping up their
efforts. While Fitch estimates that the company derives about 50%
of revenues and 40% of gross profit dollars from the mobility
platform, consumer awareness of RadioShack's mobile phone
offerings appears low, as the bulk of industry-wide wireless
transactions are completed at the carrier store. Thus,
RadioShack's longer term earnings growth prospects remain a
concern.
RadioShack's business profile, already pressured in light of the
crowded and highly-commoditized consumer electronics space, is in
the midst of several changes. On the positive front, the company
announced that it has entered into an agreement with Verizon
Wireless to provide wireless products in RadioShack stores
beginning Sept. 15, 2011. However, it no longer offers T-Mobile
wireless products in stores (but continues to offer T-Mobile
products in Target mobile centers). This transition of exiting
one carrier while ramping up on another is one driver of the
sluggish operating performance in 2011. The company is also
seeing weakness in its Sprint wireless sales. Furthermore, while
the Target mobile centers are contributing to the top line, Fitch
believes that it will be some time before they are making a
positive contribution to operating profit.
The ratings continue to reflect RadioShack's positive free cash
flow (FCF) generation and adequate liquidity. Going forward,
Fitch believes that the pressures on the business profile will
make it difficult to maintain historical EBITDA and FCF levels. A
positive catalyst to improve leverage is not apparent given the
recent trends, and Fitch expects that the company will need to
continue to be promotional given the challenging economy, price-
sensitive consumer and largely commoditized consumer electronics
space. As a result, the recent increase in leverage may not be a
short term event.
At the same time, Fitch acknowledges that RadioShack is in a
period of transition and has experienced a number of events
outside its historical trends. For example, despite the economic
downturn, RadioShack's financial results over 2007 to 2010 had
been relatively stable, as the company's EBITDA was steady in the
$400s. Going forward, Fitch would consider a favorable change to
the outlook or rating if the company shows a positive rebound in
EBITDA and FCF and a subsequent decline in leverage back to levels
in the 4x context that were more consistent with its historical
performance. Drivers of this improvement could come from positive
traction of the new Verizon offerings, as well as stability in the
signature and consumer electronics categories and a positive
contribution from the Target mobile centers.
RadioShack has adequate liquidity with $668 million in cash and
cash equivalents and $421 million available under its $450 million
credit facility as of Sept. 30, 2011. There are no borrowings
under the facility; availability is net of $29 million letters of
credit. During the second quarter of 2011, RadioShack carried out
share repurchases in the amount of $101 million. These purchases
completed its $610 million share repurchase authorization.
However, the company announced a new $200 million share buyback
program on Oct. 25, 2011, which is expected to be completed over
the next 12 months. RadioShack also announced a 100% increase to
its dividend, taking the annual cash outlay to approximately $50
million per year. While the company does have a sizable cash
balance, the increased dividend and share repurchase activity is
viewed as aggressive given that the mobility business is in
transition, recent trends have been soft and the two other product
platforms representing about 60% of gross profit dollars (Fitch
estimates) are in decline.
In accordance with Fitch's Recovery Rating (RR) methodology, Fitch
has instituted Recovery Ratings because of the IDR downgrade to
'B+'. While concepts of Fitch's RR methodology are considered for
all companies, explicit Recovery Ratings are assigned only to
those companies with an IDR of 'B+' or below. At the lower IDR
levels, Fitch believes there is greater probability of default so
the impact of potential recovery prospects on issue-specific
ratings becomes more meaningful and is more explicitly reflected
in the ratings dispersion relative to the IDR.
The ratings on the various securities reflect Fitch's recovery
analysis which is based on a liquidation value of RadioShack in a
distressed scenario of around $800 million. Applying this value
across the capital structure results in an outstanding recovery
prospect (91%-100%) for the asset-based revolver. This revolver
is rated 'BB+/RR1' and is collateralized by a first lien on
inventory and receivables. The unsecured senior notes and
convertible debt are rated 'B+/RR4' reflecting average recovery
prospects (31%-50%).
Fitch has downgraded and assigned RRs to the following ratings as
indicated:
RadioShack Corporation
-- IDR to 'B+' from 'BB';
-- $450 million secured revolving credit facility to 'BB+/RR1'
from 'BBB-';
-- Senior unsecured notes to 'B+/RR4' from 'BB'
REAL MEX: Committee Opposes Quick Sale and New Loan
---------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the Real Mex Restaurants Inc. creditors' committee,
saying there is no "financial exigency," is opposing a quick sale
of Real Mex. The committee also opposes approval of secured
financing.
Mr. Rochelle relates that Real Mex has a hearing on Nov. 3 in U.S.
Bankruptcy Court in Delaware for approval of sale procedures where
an auction would take place Jan. 9. The committee says that the
first bid at auction is likely to be a so-called credit bid by
holders of $130 million in second-lien notes. If approved by the
bankruptcy judge, bids would be due initially by Jan. 4, followed
by a Jan. 9 auction and a Jan. 13 hearing to approve the sale.
According to the report, the committee says in papers filed
Oct. 30 that a sale to junior bondholders would leave "unsecured
creditors with little prospect for recovery." There is no need
for an emergency sale, the committee contends, because the
business "is not hemorrhaging cash or losing value." Also, there
was "no prepetition marketing process," according to the
committee.
Mr. Rochelle notes that the committee is also similarly opposing
final approval of $49 million in secured financing provided by
General Electric Capital Corp., as agent for existing first-lien
lenders. The committee says that the financing will slant the
sale process in favor of second-lien lenders. The committee
points out that only $9 million of the loan represents new
financing while $37.6 million would repay pre-bankruptcy debt to
GECC. Even so, the committee complains that a "majority" of the
additional cash will go to the lenders and their professionals in
various fees.
The creditors committee, Mr. Rochelle points out, is also opposing
the terms for hiring Imperial Capital LLC as Real Mex's investment
banker. In particular, the committee takes issue with paying
Imperial a fee from $2 million to $5 million "regardless of
Imperial's ultimate contribution to the process." The committee
contends Imperial's proposed fee structure would give incentive
for a quick sale to second-lien creditors.
About Real Mex
Based in Cypress, California, Real Mex Restaurants, Inc., owns and
operates restaurants, primarily through its major subsidiaries El
Torito Restaurants, Inc., Chevys Restaurants, LLC, and Acapulco
Restaurants, Inc. It has 178 restaurants, with 149 in California.
There are also 30 franchised locations. It acquired Chevys Inc.
for $90 million through confirmation of Chevy's Chapter 11 plan in
2004.
Real Mex Restaurants and 16 of its affiliates filed for Chapter 11
bankruptcy protection (Bankr. D. Del. Case Nos. 11-13122 to
11-13138) on Oct. 4, 2011. Judge Brendan Linehan Shannon oversees
the case. Judge Peter Walsh was initially assigned to the case.
The Debtors are represented by Mark Shinderman, Esq., Fred
Neufeld, Esq., and Haig M. Maghakian, Esq., at MILBANK, TWEED,
HADLEY & McCloy LLP; and Laura Davis Jones, Esq., and Curtis A.
Helm, Esq., at PACHULSKI STANG ZIEHL & JONES LLP as counsel. The
Debtors' financial advisors are Imperial Capital, LLC. The
Debtors' claims, noticing, soliciting and balloting agent is Epiq
Bankruptcy Solutions, LLC.
Assets are $272.2 million while debt totals $250 million,
according to the Chapter 11 petition. The petitions were signed
by Richard P. Dutkiewiez, chief financial officer and executive
vice president.
Counsel to GE Capital Corp., the DIP Agent and the Prepetition
First Lien Secured Agent, are Jeffrey G. Moran, Esq., and Peter P.
Knight, Esq., at Latham & Watkins LLP; and Kurt F. Gwynne, Esq.,
at Reed Smith LLP as counsel.
Counsel to the Prepetition Secured Second Lien Trustee are Mark F.
Hebbeln, Esq., and Harold L. Kaplan, Esq., at Foley & Lardner LLP.
Counsel to the Majority Prepetition Second Lien Secured
Noteholders are Adam C. Harris, Esq., and David M. Hillman, Esq.,
at Schulte Roth & Zabel LLP; and Russell C. Silberglied, Esq., at
Richards Layton & Finger.
Z Capital Management LLC, which holds nearly 70% of the OpCo term
loan, is represented by Derek C. Abbott, Esq., and Chad A. Fights,
Esq., at Morris Nichols Arsht & Tunnell LLP; and Lee R. Bogdanoff,
Esq., and Whitman L. Holt, Esq., at Klee Tuchin Bogdanoff & Stern
LLP.
REPUBLIC MORTGAGE: S&P Assigns Unsolicited 'CC' Rating
------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on RMIC to
'CC' from 'B+'. "We removed the rating from CreditWatch Negative
where it was placed Aug. 1, 2011. The outlook is negative. We
simultaneously withdrew this rating at the request of the company
and assigned an unsolicited 'CC' rating," S&P said.
"Despite the company's request to withdraw the ratings, we believe
that there is sufficient market interest in RMIC to maintain a
public rating, although on an unsolicited basis," said Standard &
Poor's credit analyst Robert E. Green. "We view the two operating
companies as a combined group because an intercompany pooling
arrangement effectively shares business between both RMIC units
(as well as an unrated third unit). RMIC reported a pretax
operating loss of $237.8 million in third-quarter 2011, up from a
loss of $94 million for third-quarter 2010. Claim costs of $298.2
million in third-quarter 2011 were about 38% higher than those
reported in third-quarter 2010. Losses for the first nine months
of 2011 generated a loss ratio of 236% compared with a loss ratio
of 141% for the first nine months of 2010, excluding commutations
and pool transactions."
"We expect ongoing losses to erode capital. In its press release
of Oct. 27, 2011, RMIC management stated that it expects Old
Republic International Corp.'s (ORI) capital investment in
Republic Mortgage Insurance Co. (currently $155.7 million) to
"continue toward full depletion in relatively short order."
"Management has also categorically stated that that each ORI
operating company stands alone, and no new capital will be
forthcoming. Capital erosion is exacerbated by the fact that RMIC
has been in voluntary runoff since August 2011, and is generating
almost no new premium revenue, although the existing book of
business continues to generate premium earnings. As a result we
expect statutory capital to go negative, increasing the likelihood
of a regulatory takeover of the mortgage insurance companies."
ORI is the ultimate parent of RMIC. ORI's bond indentures contain
a clause whereby the outstanding balances may be accelerated if a
"significant subsidiary," as defined by Rule 1-02 of Regulation S-
X, is adjudicated bankrupt or insolvent, or approving a petition
seeking a reorganization or rehabilitation. Under this definition,
RMIC is currently considered a "significant subsidiary." "We
believe it's unlikely that RMIC would precipitate an acceleration.
However, should an acceleration occur, we believe ORI's current
holdings of liquid assets, the subsidiaries' dividending capacity,
capital available from Old Republic General Insurance Group, and
access to the capital markets would prevent a liquidity crisis,"
S&P said.
"The negative outlook on RMIC reflects our belief that operating
results will continue to be negative and regulatory intervention
is the most likely path. In the less-likely event that losses
diminish in the near term and capital is stabilized, the rating
could be raised to the 'B' category," S&P said.
REYNOLDS FUNERAL: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Reynolds Funeral Service, L.L.C.
aka Reynolds Funeral Service (Collinsville)
aka Reynolds Funeral Service (Sheridan)
aka Reynolds at Rose Hill Funeral Home & Cemetary
dba Adam's Crest Cremation
4161 E. Admiral Place
Tulsa, OK 74115
Bankruptcy Case No.: 11-13062
Chapter 11 Petition Date: October 24, 2011
Court: United States Bankruptcy Court
Northern District of Oklahoma (Tulsa)
Judge: Dana L. Rasure
Debtor's Counsel: Chad J. Kutmas, Esq.
MCDONALD, MCCANN & METCALF, LLP
15 E. Fifth Street, Suite 1800
Tulsa, OK 74103
Tel: (918) 430-3700
Fax: (918) 430-3770
E-mail: ckutmas@mmmsk.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's 20 largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/oknb11-13062.pdf
The petition was signed by Nick Reynolds, president.
Debtor-affiliate that filed separate Chapter 11 petition:
Petition
Debtor Case No. Date
------ -------- ----
Nick Reynolds Corporation 11-13063 10/23/11
RIVER ROCK: S&P Lowers Issuer Credit Rating to 'CCC'
----------------------------------------------------
Standard & Poor's Ratings Services lowered its existing ratings,
including its issuer credit rating, on Sonoma County, Calif.-based
River Rock Entertainment Authority (RREA) to 'CCC' from 'B-'. All
existing ratings remain on CreditWatch with negative implications,
where they were placed on Dec. 9, 2010.
"Our preliminary 'B-' issue-level rating on RREA's proposed $205
million senior notes, consisting of $110 million series A senior
notes due 2018 and $95 million series B tax-exempt senior notes
due 2018, remains unchanged. In the unlikely event RREA is
successful in executing the proposed transaction, we expect to
raise our issuer credit rating to 'B-' and finalize our issue-
level rating on the new notes, pending our review of final
documentation. If RREA pursues an alternative refinancing or
restructuring plan, we expect to withdraw this preliminary
rating," S&P related.
RREA was created to operate the River Rock Casino for the Dry
Creek Rancheria Band of Pomo Indians (the Tribe).
"Our 'CCC' issuer credit rating on RREA remains on CreditWatch
with negative implications, reflecting RREA's refinancing needs
associated with its $200 million senior notes due Nov. 1, 2011, as
well as other debt held at the Tribe. The proposed refinancing
would address both debt issues," S&P said.
"Given the very short timeframe to execute the proposed
transaction and the fact that RREA has not reached an agreement on
the terms of its proposed notes issuance, we believe there is a
high likelihood that RREA will need to pursue a restructuring to
address the maturity," said Standard & Poor's credit analyst Ben
Bubeck.
"In the unlikely event of a successful refinancing, we expect to
raise our issuer credit rating to 'B-' and assign a stable rating
outlook. We believe that, despite the threat of new competition
entering the market over the intermediate term, RREA will generate
sufficient cash flow to support the proposed capital structure.
Last year, the Department of the Interior granted land into trust
for the Federated Indians of Graton Rancheria (Graton Tribe),
a federally recognized Native American tribe. We believe the
Graton Tribe intends to build a casino in Rohnert Park, Calif.,
approximately 35 miles from the River Rock Casino. Although the
Graton Tribe must negotiate a compact with California and obtain
financing before moving forward with the casino and there's
limited clarity around the size, scope, and timing of the project,
we view the land-into-trust decision as significant progress
toward the casino opening. Our rating incorporates a scenario in
which the Graton casino opens in 2014 and RREA's EBITDA
subsequently declines in the mid-to-high 30% range because of this
new competition. Management believes that EBITDA declines will
be somewhat less and that its mitigating actions could bring the
net impact below 30%," S&P said.
"Even though we expect RREA to experience a meaningful decline in
EBITDA should new competition enter the market, we believe RREA
should generate sufficient cash flow to service the proposed
capital structure. We base this opinion on our performance
expectations for RREA and the terms of the proposed $205
million senior notes. The proposed notes require significant
mandatory amortization in the form of a 90% semi-annual excess
cash flow sweep, as well as restrictions on the amount of tribal
distributions, both of which tighten in the event EBITDA declines
below certain thresholds. We currently expect EBITDA generation to
remain relatively stable over the next few years, which should
facilitate meaningful debt repayment and leave RREA better
positioned to absorb the impact of new competition," S&P said.
"We believe the level of tribal distributions permitted under the
proposed notes offering is likely sufficient to fund the Tribe's
current budget needs. However, the majority of the Tribe's budget
is supported by these distributions, and, despite limitations on
distributions within the proposed indenture, it is unclear how
willing or able the Tribe would be to reduce distributions should
operating performance materially decrease," S&P related.
ROBERT SANDERS: Bankruptcy Halts Navistar v. DC Acquisitions Suit
-----------------------------------------------------------------
District Judge Billy Roy Wilson halted the lawsuit, NAVISTAR
FINANCIAL CORPORATION, v. DC ACQUISITIONS, LLC; DC XPRESS OF
LITTLE ROCK, LLC; and ROBERT SANDERS, No. 4:10CV00938 (E.D. Ark.),
in view of Robert Sanders' bankruptcy filing (Bankr. E.D. Ark.
Case No. 11-13320). The automatic say provisions of 11 U.S.C.
Sec. 362(a) are applicable to the plaintiff in this matter, Judge
Wilson said in his Oct. 27, 2011 Order, available at
http://is.gd/ESPcGmfrom Leagle.com.
ROOFING SUPPLY: Moody's Affirms 'B2' Corporate Family Rating
------------------------------------------------------------
Moody's Investors Service affirmed Roofing Supply Group, LLC's
("RSG") B2 Corporate Family Rating and B2 Probability of Default.
In a related rating action, Moody's lowered the rating of RSG's
Senior Secured Notes due 2016 to B3 from B2 because RSG is in the
process of obtaining an increase to its asset-based revolving
credit facility, which may reduce potential recovery values of the
Notes. The rating outlook is stable.
These ratings/assessments were affected by this action:
Corporate Family Rating affirmed at B2;
Probability of Default affirmed at B2; and,
$225 million Senior Secured Notes due 2017 lowered to B3 (LGD4,
66%) from B2 (LGD4, 56%).
RATINGS RATIONALE
RSG's B2 Corporate Family Rating reflects its high financial
leverage and moderate interest coverage. Partially offsetting
these weaknesses is the company's solid position in roofing supply
distribution resulting in resilient performance during the
economic and housing downturns and healthy operating margins. RSG
also has a solid liquidity profile highlighted by a potential
substantial increase in revolver availability and a lack of near-
term maturities.
The downgrade of RSG's $225 million Senior Secured Notes due 2017
to B3, one notch below the corporate family rating, from B2
results from potentially increasing its asset-based revolving
credit facility to $150 million from $60 million. The asset-based
revolver will benefit from a first lien on RSG's most liquid
assets, whereas the notes are secured by fixed assets, and a
second lien on the assets securing the revolving credit facility.
Although Moody's anticipates improving operating margins, RSG must
demonstrate its ability to generate meaningful levels of earnings
and free cash flow. Maintaining its solid liquidity profile and
improving operating performance that results in EBITA-to-interest
expense trending towards 3.0 times and debt-to-EBITDA of around
4.0 times (all ratios incorporate Moody's standard adjustments)
could result in positive rating actions.
Factors which might result in negative rating actions include
erosion in RSG's liquidity profile or deterioration in operating
performance that results in EBITA-to-interest expense trending
towards 1.5 times or debt-to-EBITDA sustained above 6.0 times (all
ratios incorporate Moody's standard adjustments).
RSG's ratings were assigned by evaluating factors that Moody's
considers relevant to the credit profile of the issuer, such as
the company's (i) business risk and competitive position compared
with others within the industry; (ii) capital structure and
financial risk; (iii) projected performance over the near to
intermediate term; and (iv) management's track record and
tolerance for risk. Moody's compared these attributes against
other issuers both within and outside RSG's core industry and
believes RSG ratings are comparable to those of other issuers with
similar credit risk. Other methodologies used include Loss Given
Default for Speculative-Grade Non-Financial Companies in the U.S.,
Canada and EMEA published in June 2009.
Roofing Supply Group LLC, headquartered in Dallas, TX, is one of
the largest wholesale distributor by revenues of roofing supplies
and related building materials in the United States. RSG provides
products directly from the manufacturer to roofing contractors,
home builders, retailers and other end users. Sterling Group, LP
("Sterling") through its respective affiliates, is the primary
owner of RSG. Revenues for the twelve months through June 30, 2011
totaled about $0.8 billion.
SALINAS INVESTMENTS: Court Sets Nov. 30 Confirmation Hearing
------------------------------------------------------------
On Oct. 19, 2011, Bankruptcy Judge signed an order approving the
disclosure statement explaining Salinas Investments, Ltd.'s
Chapter 11 Plan of Reorganization.
Nov. 18, 2011, is fixed as the last day for delivering to the
Debtor's counsel ballots evidencing acceptances or rejections of
the Plan. Nov. 18, 2011, is also fixed as the last day for filing
and serving written objections to the confirmation of the Plan.
The hearing on the confirmation of the Debtor's Plan will be held
on Nov. 30, 2011, at 9:30 a.m.
As reported in the TCR on Aug. 26, 2011, Salinas Investments' Plan
provides for the satisfaction of the allowed claims of
all creditors.
The Debtor's plan divides claims into five classes of claims:
A. Allowed administrative claims - Will be in full in
cash on the Distribution Date.
B. Class 1 (Allowed property tax claims) - The Debtor will
pay the Class 1 Creditor's Allowed Claim in 60 equal
monthly installments with 12% interest per annum.
C. Class 2 (Allowed priority claims) - The Debtor will pay
the creditor a monthly payment determined by amortizing
the allowed claim over a period of 72 months plus allowed
interest.
D. Class 3 (First National Bank claims) - First National Bank
will receive quarterly payments of $46,500 over two years
from March 15, 2012, to December 15, 2017. In addition,
Salinas Investments will secure First National's release
of its lien on any acre of real property that is part of
the collateral by paying to First National a release price
of $7,200 per acre.
E. Class 4 (Allowed unsecured claims) - Salinas will pay over
a period of five years after the Effective Date and in 4
equal installments each year, pay their respective Class 4
Creditors their pro rata share of 50% of the difference
of: (i) the partnership's net taxable income and (ii) the
sum of all plan payments and debt service payments made by
Salinas. After all non-insider Class 4 Creditors are paid
in full, Salinas will be authorized to satisfy the Allowed
Claims of Class 4 Creditors who are insiders.
F. Class 5 (Equity security or interest holders) - Will
retain their interest in Salinas.
A copy of the Disclosure Statement is available at
http://bankrupt.com/misc/SALINAS_disclosurestatement.pdf
About Salinas Investments
San Antonio, Texas-based Salinas Investments, Ltd., filed for
Chapter 11 bankruptcy protection on July 2, 2010 (Bankr. W.D. Tex.
Case No. 10-52525). William B. Kingman, Esq., who has an office
in San Antonio, Texas, assists the Debtor in its restructuring
effort. The Company disclosed $17,561,043 in assets and
$4,269,961 in liabilities.
SEAVIEW PLACE: Combined Hearing on Plan and Disclosures Dec. 1
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida has
conditionally approved the First Amended Disclosure Statement
filed by Seaview Place Developers, Inc., et al., on Oct. 14, 2011.
Any written objections to the Disclosure Statement will be filed
with the Court no later than seven (7) days prior to Dec. 1, 2011,
the date of the hearing on confirmation.
If no objections are filed within the time fixed, the conditional
approval of the Disclosure Statement will become final. Any
objections or requests to modify the Disclosure Statement will be
considered at the Confirmation Hearing.
The court will conduct a hearing on confirmation of the Plan,
including timely filed objections to confirmation, objections to
the disclosure statement, motions for cramdown, applications for
compensation, and motions for allowance of administrative claims
on Dec. 1, 2011, at 1:30 p.m.
Parties in interest will file with the court their written ballots
accepting or rejecting the Plan no later than eight (8) days
before the date of the Confirmation Hearing.
In accordance with M.D. Fla. L.B.R. 3018-1(a), the Debtors will
file a ballot tabulation no later than three (3) days before the
date of the Confirmation Hearing.
Revesting of Assets; Release of Liens
The Property of the Debtors' estates, together with any property
of the Debtors that is not Property of their estates and that is
not specifically disposed of or abandoned pursuant to the Plan,
will revest in the respective Debtors on the Effective Date
(unless the Debtors are merged as a single surviving entity, as
contemplated in the Plan). Thereafter, the Reorganized Debtors
may operate their businesses and may use, mortgage, acquire, and
dispose of such property free of any restrictions of the
Bankruptcy Code, the Bankruptcy Rules, and the Bankruptcy Court.
As of the Effective Date, all such Property of the Reorganized
Debtors will be free and clear of all Liens, Claims, encumbrances,
and Equity Interests of any kind, type, or nature whatsoever
except as otherwise specifically provided under the Plan.
Plan Funding
The Debtors' continuing operations and payments to be made under
the Plan will be funded by (1) any available Cash, (2) revenues
generated from future sales of the Debtors' Retained Property, (3)
through the surrender of a substantial portion of their Property
in an amount determined by the Bankruptcy Court or by agreement
among the affected Creditors, sufficient to satisfy all Allowed
Secured Claims, and/or (4) through Exit Financing.
BB&T's Secured Claim
With respect to BB&T's Class 3A Secured Claim, estimated at
$21,690,694, in accordance with the Mediation Agreement, Seaview
and Gulf will, on the Effective Date, transfer, assign, and convey
to BB&T all of their respective right, title, and ownership in the
Seaview Place Condominiums consisting of 121 condominium units, 53
garages, and 45 boat slips, Tract 40-A, and Tract 40-B, along with
any corresponding Developer Rights and all entitlements related to
the BB&T Transferred Property in full and complete satisfaction of
BB&T's Claims against any and all of the Debtors and the Debtors
affiliates released under the Mediation Agreement.
BB&T will continue and ultimately dismiss with prejudice the State
Litigation as to all parties; the Debtors, BB&T, the Principals,
and J&M Development Concepts LLC, will execute mutual general
releases; and as long as Debtors are in compliance with the terms
of the Mediation Agreement, BB&T will not assert an Unsecured
Claim against the Debtors and will vote in favor of and support
Confirmation of the Plan.
Class 3A is Impaired under the Plan and the Holder of the Class 3A
Claim is entitled to vote to accept or reject the Plan.
Class 5 General Unsecured Claims
Allowed Class 5 General Unsecured Claims, estimated at $257,500,
will receive either (Option 1) a Pro Rata Share of Cash available
in the Sales Proceeds Pool as of each Distribution Date, which
Distributions will, to the extent of funding in the Sales Proceeds
Pool, commence on the first anniversary date following the
Effective Date and thereafter on each consecutive anniversary date
following the Effective Date (plus interest at an annual rate of
4%), until such Claims are fully paid, or (Option 2)
alternatively, at the election of the Debtors and the Holder of
such Claim, a lump sum payment of Cash equal to 75% of the Allowed
Amount of such Class 5 Claim (without interest) within 45 days
following the Effective Date, in full and complete satisfaction of
such Claim.
Class 5 is Impaired under the Plan and the Holder(s) of Class 5
Claims are entitled to vote to accept or reject the Plan.
Equity Interests
Unless all Equity Interests are canceled and extinguished (i) in
order to satisfy the requirements of 11 U.S.C. Section
1129(b)(2)(B) or (ii) because the DIP Lender has elected to accept
newly issued stock in the Reorganized Debtor(s), in full or
partial satisfaction of its DIP Financing Claim then, on the
Effective Date, each Holder of an Equity Interest in Class 7 will
retain such Equity Interest and will retain, unaltered, the legal,
equitable, and contractual rights to which such Equity Interest
entitles such Holder.
Class 7 is Impaired under the Plan and the Holder(s) of a Class 7
Equity Interest is not entitled to vote to accept or reject the
Plan.
A copy of the First Amended Disclosure Statement is available for
free at http://bankrupt.com/misc/seaviewplace.firstamendedDS.pdf
About Seaview Place Developers
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. In its schedules, the Debtor
disclosed $24,769,500 in total assets and $15,147,744 in total
debts as of the Petition Date.
Affiliates Gulf Landings Development Corporation and Harbor Colony
Development, Inc. filed separate petitions for Chapter 11 relief
on July 8, 2011 (Bankr. M.D. Fla. Case No. 11-13101 and Case No.
11-13103).
The Debtors are owned by J&M Developments LLC. Seaview developed,
built, owns, and now manages a nine-story, waterfront high-rise
condominium (the "Seaview Building") in Pasco County, Florida
commonly known as Seaview Place. Gulf owns properties in Pasco
and Pinellas Counties, including two tracts adjacent to Seaview
Place. Harbor owns a vacant real property in Pasco County.
The Debtors' cases are jointly administered under Lead Case 11-
05126.
David S. Jennis, Esq., Chad S. Bowen, Suzy Tate, Esq., and
Kathleen L DiSanto, Esq., at Jennis & Bowen, P.L., in Tampa,
Florida, represent the Debtors as counsel.
SHELDRAKE LOFTS: Court OKs Ditchik and Griffin as Special Counsel
-----------------------------------------------------------------
Sheldrake Lofts LLC sought and obtained permission from the U.S.
Bankruptcy Court for the Southern District of New York to employ
Ditchik & Ditchik LLP and Griffin, Coogan, Blose & Sulzer, P.C. as
special counsel for tax certiorari matters for the 2011 assessment
year.
Joel Ditchik, Esq., partner at Ditchik & Ditchik LLP, attests that
the firm is a "disinterested person" as that term is defined in
section 101(14) of the Bankruptcy Code.
William Sulzer, Esq., partner at Griffin, Coogan, Blose & Sulzer,
P.C., attests that the firm is a "disinterested person" as that
term is defined in section 101(14) of the Bankruptcy Code.
About Sheldrake Lofts LLC
New Rochelle, New York-based Sheldrake Lofts LLC owns several
contiguous parcels of real property in the Village of Mamaroneck
situated along the Sheldrake River: 270 Waverly Avenue, 206-208
Waverly Avenue, 188 Waverly Avenue. It filed for Chapter 11
protection on Aug. 10, 2010 (Bankr. S.D.N.Y. Case No. 10-23650).
David H. Wander, Esq., at Davidoff, Malito & Hutcher, LLP, serves
as the Debtor's bankruptcy counsel. The Debtor estimated its
assets at $50 million to $100 million and its debts at $10 million
to $50 million as of the Petition Date.
SMART & FINAL: Moody's Reviews 'B3' CFR for Possible Downgrade
--------------------------------------------------------------
Moody's Investors Service placed ratings for Smart & Final
Holdings Corporation on review for a possible downgrade.
RATINGS RATIONALE
'Moody's review will focus on verifiable and meaningful progress
towards the resolution of the refinancing of the company's $212
million CMBS credit facility maturing June 2012", Moody's Senior
Analyst Mickey Chadha stated. "Absence of any evidence of
significant progress in this regard and any contraction in
liquidity could have negative implications to the rating" Chadha
further stated.
The resolution of the pending maturity of the CMBS credit facility
on reasonable economic terms continues to weigh heavily on the
ratings and as the maturity date of the CMBS facility gets closer
without a resolution, Smart and Final's probability of default
will get higher.
The B3 Corporate Family Rating continues to reflect Smart &
Final's weak liquidity, high leverage, geographic concentration,
and challenging geographic and demographic markets. The ratings
also recognize the potential benefits of the company's
diversification efforts and new management initiatives.
The following ratings were put on review for possible downgrade.
LGD point estimates were updated and are subject to further
change:
Smart & Final Holdings Corporation
Corporate Family Rating of B3;
Probability of Default Rating of B3.
Smart & Final Stores LLC
$47.2 million First Lien Term Loan maturing May 2014 at B3 (LGD 3,
49%, from LGD 3, 48%);
$119.2 million First Lien Term Loan maturing May 2016 at B3 (LGD
3, 49%, from LGD 3, 48%);
$125 million Asset-Based Revolving Credit Facility maturing 2016
at Ba2 (LGD 2, 17%);
$138 million Second Lien Term Loan maturing November 2016 at Caa1
(LGD 5, 76%);
$2.2 million Second Lien Term Loan maturing November 2014 at Caa1
(LGD 5, 76%).
The principal methodology used in rating Smart & Final was the
Global Retail Industry Methodology 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.
SOUTH EDGE: Court Confirms Joint Plan of Reorganization
-------------------------------------------------------
On Oct. 27, 2011, the U.S Bankruptcy Court for the District of
Nevada entered its order confirming the Joint Plan of
Reorganization proposed by JPMorgan Chase Bank, N.A., as
administrative agent under the Prepetition Credit Agreement, and
the Settling Builders (amended as of Oct. 21, 2011). The
Disclosure Statement for the Joint Plan of Reorganization was
approved by order of the Bankruptcy Court on Sept. 8, 2011.
As reported in the TCR on Nov. 1, 2011, the Chapter 11 exit plan
calls for a group of home builders to pay the project's lenders
$335 million to settle legal troubles related to the venture.
The bankruptcy judge approved a settlement with Focus Group South
LLC on Oct. 17. Focus was claiming a lien on about $26 million
cash and opposed approval of the reorganization plan.
According to Bloomberg News, the reorganization plan for the
project's owner, South Edge LLC, will implement a larger
settlement negotiated in May by secured lenders with South Edge's
Chapter 11 trustee, KB Home and other homebuilders who represented
92 percent of the ownership interests in the project.
The project ultimately was to cost $1.25 billion and have 8,500
homes. The lenders were to provide $595 million in financing.
Other financing includes $102 million in public bonds for
improvements.
A copy of the Order confirming the Joint Plan of Reorganization
is available for free at:
http://bankrupt.com/misc/southedge.dkt1335.pdf
A copy of the Joint Plan of Reorganization proposed by JPMorgan
Chase Bank, N.A., as administrative agent under the prepetition
credit agreement, and the Settling Builders (amended as of
Oct. 21, 2011) is available for free at:
http://bankrupt.com/misc/southedge.dkt1309.pdf
About South Edge
Las Vegas, Nevada-based South Edge LLC owns the Inspirada project,
an uncompleted 2,000-acre residential development in Henderson,
Nevada, about 16 miles (26 kilometers) southeast of Las Vegas.
The eight owners of the project include an affiliate of KB Home, a
49% owner. Other owners are Coleman Toll LP with 10.5%, Pardee
Homes Nevada Inc. with 4.9%, Meritage Homes with 3.5%, and Beazer
Homes USA Inc. with 2.6%.
JPMorgan Chase Bank, N.A., Credit Agricole Corporate and
Investment Bank, and Wells Fargo Bank, N.A., filed an involuntary
chapter 11 bankruptcy petition (Bankr. D. Nev. Case No. 10-32968)
on Dec. 9, 2010, against South Edge, LLC. The petitioning
creditors are part of a lender group that provided a $595 million
credit. New York-based JPMorgan serves as lender and agent for
the group. South Edge filed motions to dismiss the involuntary
petition.
The Court conducted a contested trial on Jan. 24 and 25, 2011, and
Feb. 2 and 3, 2011. On Feb. 3, 2011, the Court entered an order
for relief under Chapter 11 of the Bankruptcy Code against the
Debtor and issued an order directing the appointment of a chapter
11 trustee. The United States Trustee appointed Cynthia Nelson to
serve as Chapter 11 trustee on Feb. 20, 2011. The Court approved
the appointment three days later.
South Edge is represented by lawyers at Klee, Tuchin, Bogdanoff
and Stern LLP, and The Schwartz Law Firm, Inc., as legal counsel.
The Chapter 11 trustee also tapped Schwartzer & McPherson Law Firm
as local counsel.
Petitioning creditors JPMorgan Chase Bank, N.A., and Wells Fargo
Bank, N.A., are represented by lawyers at Morrison and Foerster
LLP; and Lewis and Roca LLP. Credit Agricole is represented by
lawyers at Haynes and Boone LLP, and Jolley Urga Wirth Woodbury &
Standish.
SOUTHERN MONTANA ELECTRIC: Coops Mull Suit to Stop Bankruptcy Case
-----------------------------------------------------------------
KFBB News Team reports that officials with Huntley, Montana-based
Yellowstone Valley Electric Cooperative are planning to file
lawsuits to stop the bankruptcy case of Southern Montana Electric,
along with a 20% rate increase.
According to the report, YVEC's General Manager, Terry Holzer,
says they are also looking at asking the court to dissolve
Southern Montana altogether. "It's not how a cooperative in
Montana should be governed, and I think it's time that this G and
T, and the board members and management of this G and T, realize
that it's no longer in the best interest of Montanans that they're
supposedly serving, to remain in existence," Mr. Holzer explained.
The report says the president of Beartooth Electric Cooperative in
Billings, Montana, has said they are also considering asking the
bankruptcy court in Butte to throw out SME's bankruptcy suit.
About Southern Montana
Based in Billings, Montana, Southern Montana Electric Generation &
Transmission Cooperative Inc. -- http://www.smegt.net/-- was
formed to serve five other electric cooperatives. The city of
Great Falls later joined as the sixth member. Including the city,
the co-op serves a population of 122,000. In addition to Great
Falls, the service area includes suburbs of Billings, Montana.
SME filed for Chapter 11 bankruptcy (Bankr. D. Mont. Case No.
11-62031) on Oct. 21, 2011. Southern Montana estimated assets of
$100 million to $500 million and estimated debts of $100 million
to $500 million. Timothy Gregori signed the petition as general
manager. Jon E. Doak, Esq., at Doak & Associates, P.C., in
Billings, Montana, serves as the Debtor's counsel.
THINKFILM INC: Creditors Get Judge's Approval to Develop Plan
------------------------------------------------------------- Alex
Ben Block at the Hollywood Reporter says Judge Barry Russell ruled
on Oct. 26, 2011, that a creditors group can proceed to develop a
plan to reorganize ThinkFilm, Capitol Film and three other
companies forced into bankruptcy that were overseen by David
Bergstein.
According to the report, Judge Russell denied a motion by Ronald
Durkin, a trustee overseeing the bankrupt companies, to convert
the cases from a Chapter 11 bankruptcy reorganization to a
Chapter 7 liquidation. Mr. Durkin had also offered the judge the
option of dismissing the cases altogether.
The Hollywood Reporter relates that Mr. Bergstein and his former
business partner Ronald Tutor had strongly supported the idea of
dismissing the cases. Mr. Tutor, through two companies he
controls, claims to be the largest creditor in the case. However,
Judge Russell's ruling favored a group of creditors led by the
Aramid Entertainment Fund, who were the ones who originally
brought the action that forced the involuntary bankruptcy.
The report notes the Aramid led group has proposed lending up to
$4 million to the entities and reorganizing them to tap into the
assets, so that the unsecured creditors have a greater chance of
being repaid. That would include appointing a commercial agent to
exploit the approximately 1,000 movies that are in the companies'
film libraries.
The Hollywood Reporter relates that the creditors had pleaded to
Judge Russell not to convert or dismiss the cases, as that would
reward Messrs. Bergstein and Tutor for what they believe were
improper and illegal actions such as backdating documents, filing
incomplete tax returns and false creditor lists.
The report says the creditors group also has said it intends to
seek a new trustee to oversee the companies, who would replace Mr.
Durkin. The report says the creditors want John P. Brinkco,
president of Sitrick Brincko Group, as the new trustee.
About Thinkfilm, et al.
CapCo Group LLC and four other companies controlled by David
Bergstein are part of a wider network of entities that distribute
and finance films. Among the approximately 1,300 films they have
the rights to are "Boondock Saints" and "The Wedding Planner."
Several creditors filed for involuntary Chapter 11 bankruptcy
against the companies on March 17, 2010 -- CT-1 Holdings LLC
(Bankr. C.D. Calif. Case No. 10-19927); CapCo Group, LLC (Bankr.
C.D. Calif. Case No. 10-19929); Capitol Films Development LLC
(Bankr. C.D. Calif. Case No. 10-19938); R2D2, LLC (Bankr. C.D.
Calif. Case No. 10-19924); and ThinkFilm LLC (Bankr. C.D. Calif.
Case No. 10-19912). Judge Barry Russell presides over the cases.
The Petitioners are represented by David L. Neale, Esq., at Levene
Neale Bender Rankin & Brill LLP.
Judge Barry Russell formally declared David Bergstein's ThinkFilm
LLC and Capitol Films Development bankrupt on Oct. 5, 2010.
Mr. Bergstein is being sued for tens of millions of dollars by
nearly 30 creditors -- including advertisers, publicists and the
Writers Guild West. Five Bergstein controlled companies have been
named in the suit.
TOWER OAKS: Court Rejects Request to Prohibit Cash Collateral Use
-----------------------------------------------------------------
Judge Paul Mannes of the U.S. Bankruptcy Court for the District of
Maryland denied the request of CWCapital Asset Management LLC for
an order prohibiting Tower Oaks Boulevard, LLC, from using cash
collateral.
CWCAM acts as special servicer for U.S. Bank National Association,
as trustee, as successor-in-interest to Bank of America, N.A., as
trustee for the Registered Holders of COBALT CMBS Commercial
Mortgage Trust 2007-C2, Commercial Mortgage Pass-Through
Certificates, Series 2007-C2.
As reported in the Oct. 24, 2011 edition of the Troubled Company
Reporter, the trust related in its Motion to Prohibit that it does
not consent to the use of cash collateral absent the specific
permission of the trust or the entry of a comprehensive cash
collateral order. The trust asserted that unauthorized use of
cash collateral irreparably harms it because it is not adequately
protected and has no ability to determine if the Debtor is using
cash collateral in a manner which preserves its lien.
About Tower Oaks Boulevard, LLC
Raleigh, North Carolina-based Tower Oaks Boulevard, LLC, owns and
operates the commercial property identified as 2701 Tower Oaks
Boulevard. It filed for Chapter 11 bankruptcy protection on
(Bankr. D. Md. Case No. 11-12413) Feb. 8, 2011. Steven H.
Greenfeld, Esq., at Cohen, Baldinger & Greenfeld, LLC, serves as
the Debtor's bankruptcy counsel. Bregman, Berbert, Schwartz &
Gilday, LLC, serves as its special counsel. The Debtor estimated
assets at $10 million to $50 million and debts at $1 million to
$10 million.
Affiliate Sun Control Systems, Inc., filed a separate Chapter 11
petition on December 13, 2010 (Bankr. D. Md. Case No. 10-37991).
W. Clarkson McDow, Jr., the U.S. Trustee for Region 4, has not
appointed an official committee of unsecured creditors in the
Debtors' cases.
TRIBUNE CO: Court Denies Confirmation of Competing Plans
--------------------------------------------------------
Judge Kevin J. Carey of the U.S. Bankruptcy Court for the
District of Delaware rejected on October 31, 2011, the requests
of Tribune Company and rival Aurelius Capital Management, LP, to
confirm their competing Chapter 11 plans of reorganization for
the media company to exit Chapter 11.
The Chapter 11 Plans rejected by the Court are:
(i) The Second Amended Joint Plan of Reorganization proposed
by the Debtors; the Official Committee of Unsecured
Creditors; Oaktree Capital Management, L.P.; Angelo,
Gordon & Co., L.P.; and JPMorgan Chase Bank, N.A., as
amended; and
(ii) The Joint Plan of Reorganization proposed by Aurelius
Capital Management, L.P. on behalf of its managed
entities; Deutsche Bank Trust Company Americas, in its
capacity as successor indenture trustee for certain series
of senior notes; Law Debenture Trust Company of New York,
in its capacity as successor indenture trustee for certain
series of senior notes; and Wilmington Trust Company in
its capacity as successor indenture trustee for the PHONES
notes, as amended.
In a 126-page opinion, Judge Carey explained why neither the DCL
Plan nor the Noteholder Plan is confirmable under Section 1129 of
the Bankruptcy Code.
Judge Carey opened his opinion by way of the parable of the
scorpion and the fox. According to the bankruptcy judge, the
meaning of story "lies in the exposition of an escapable facet of
human character: the willingness to visit harm upon others, even
at one's own peril."
Judge Carey recognized that the main contention in Tribune's
bankruptcy case arises from the DCL Plan's proposed settlement of
certain LBO-Related Causes of Action with the Senior Lenders and
the Bridge Lenders, who loaned more than $10 billion to Tribune
in connection with the 2007 leveraged buy-out of Tribune. In
contrast, the Noteholder Plan preserves all of the LBO-Related
Causes of Action and creates two trusts to prosecute "vigorously"
those claims post-confirmation.
Specifically, Judge Carey concluded that the DCL Plan does not
meet the requirements for confirmation under Section 1129
because:
(i) the DCL Plan has not been accepted by at least one
impaired class for each Debtor as required by Section
1129(a)(10) of the Bankruptcy Code;
(ii) the Debtors' release in the DCL Plan is too broad to be
fair and equitable, specifically:
(a) the parties granting the release should be limited
to the Debtors; and
(b) these persons may not be released because the record
does not establish that they provided a substantial
contribution or their release is necessary for a
reorganization: the Debtors' "Related Persons,"
"Current Employees," and "401(k) Shareholders;"
(iii) the exculpation provision is too broad and must be limited
to estate fiduciaries; and
(iv) the DCL Plan does not comply with Section 510(b) of the
Bankruptcy Code by unfairly applying subordination
provisions of the PHONES notes to all "Other Parent
Claims" and to the distribution of the proceeds of Chapter
5 causes of action by the Litigation Trust.
Judge Carey did overrule objections to confirmation of the DCL
Plan with respect to:
(i) the reasonableness of the DCL Plan Settlement;
(ii) the feasibility of the DCL Plan based on FCC regulations;
(iii) the Bar Order;
(iv) the DCL Plan provision regarding treatment of prepetition
indemnification and reimbursement claims;
(v) the DCL Plan provision providing an option to assign state
law constructive fraudulent conveyance claims to the
Creditors' Trust;
(vi) Sam Zell and EGI-TRB, LLC's objection to the establishment
of the Litigation Trust and the Creditors' Trust;
(vii) the objection to equal treatment of the PHONES Noteholders
who exercised exchange rights pre-petition; and
(viii) the objection to classification of the SWAP claim.
Judge Carey further determined that the Noteholder Plan does meet
the requirements for confirmation under Section 1129 because:
(i) the Noteholder Plan has not been accepted by at least one
impaired class for each Debtor as required by Section
1129(a)(10);
(ii) the non-consensual release of Non-Debtor Guarantors is
improper;
(iii) the Noteholder Plan unfairly discriminates in its
treatment of the Senior Lenders; and
(iv) the Noteholder Plan's modified implementation of the
Intercompany Settlement Agreement is not adequately
explained to be considered fair or reasonable.
Hours before entry of the confirmation decision, Judge Carey told
Tribune's chief restructuring officer Donald J. Liebentritt at a
hearing that his opinion about the Chapter 11 Plans should be
available later that day, Steven Church of Bloomberg News
reported.
"I am hopeful something will be on the docket before you get to
Washington," Judge Carey was quoted at the hearing held on
October 31 by Bloomberg. The bankruptcy judge did not say what
his decision would be, the report noted.
Tribune and its creditors have been waiting for Judge Carey's
decision confirming a reorganization plan for the company since
the confirmation hearings concluded in late July. Last October
21, Judge Carey indicated that he was "within days" of ruling on
the rival Plans.
The Court convened the Oct. 31 hearing to consider the Official
Committee of Unsecured Creditors' request to compel production of
documents by several parties, including BNP Paribas, Bloomberg
noted. The Court approved the request that will allow the
Creditors' Committee to get the names of shareholders that may be
sued in connection with the 2007 leveraged buyout, the report
added.
"I am uncertain, at this point, what steps the Debtors or other
parties may take as a consequence of this decision. Perhaps it
may be that the parties simply will try to address the issues
raised in this Opinion, or that an entirely new plan or plans
will be devised. Perhaps parties will realign. Perhaps yet
another attempt will be made to reach consensus," Judge Carey
opined.
Judge Carey thus believes it appropriate to address the Section
1129(c) considerations to avoid wasteful efforts by the parties.
Section 1129(c) provides that "[i]f the requirements of
subsections (a) and (b) of this section [1129] are met with
respect to more than one plan, the court shall consider the
preferences of creditors and equity security holders in
determining which plan to confirm."
Judge Carey acknowledged that the voting results reveal that
creditors overwhelmingly prefer the DCL Plan over the
Noteholder Plan. Specifically, out of 128 classes of claims in
which creditors actually voted, 125 classes (97.66%) voted to
accept the DCL Plan. In contrast, out of 243 classes of claims
in which creditors actually voted, only three classes (1.2%)
voted to accept the Noteholder Plan. Of the three accepting
classes, two are the Senior Noteholders and the PHONES Notes
classes, and one is a class in which a single creditor holding a
claim of $47 voted in favor of both the DCL Plan and the
Noteholder Plan.
"Although both plans claim to allow the Debtors to reorganize,
the DCL Plan better supports this goal by resolving significant
claims and providing the Debtors with more certainty regarding
preservation of estate value and a better foundation for
revitalizing business operations," Judge Carey opined. The DCL
Plan is feasible, the bankruptcy judge held. The settlement of
claims in the DCL Plan also treats creditors fairly, Judge Carey
added.
In contrast, the Noteholders assertion that other creditors might
benefit from extensive and costly litigation is highly
speculative, Judge Carey pointed out. The overwhelming majority
of creditors have made their preference for the settlement known
through the voting results, the bankruptcy judge stated.
"Assuming that both sets of plan proponents addressed only the
flaws in their respective plans and both returned confirmable
plans containing terms otherwise similar to those presently
proposed, with similar voting results, the DCL Plan would survive
the crucible of Section 1129(c)," Judge Carey wrote.
In any event, Judge Carey stated that the Debtors must promptly
find an exit door to this Chapter 11 proceeding. "The Court is
equally resolute that if a viable exit strategy does not present
itself with alacrity, and despite any disruption to management,
as well as the added cost and delay this might inevitably
occasion, the Court intends to consider, on its own motion,
whether a chapter 11 trustee should be appointed," Judge Carey
concluded.
A full-text copy of the October 31, 2011 opinion on confirmation
of the Chapter 11 Plans is available for free at:
http://bankrupt.com/misc/Tribune_Oct31ConfirmationOpinion.pdf
November 22 Status Hearing
Judge Carey will convene a status hearing on November 22, 2011
for the purpose of conferring with the parties as provided by
Section 105(d)(1) of the Bankruptcy Code.
The status hearing intends "to further the expeditious and
economic resolution of the Chapter 11 case," Judge Carey said.
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.
Two competing Chapter 11 plans are being pursued in the Chapter 11
cases of Tribune. One plan is being co-proposed by the Debtors,
the Official Committee of Unsecured Creditors, Oaktree Capital
Management, L.P., Angelo Gordon & Co., L.P. and JPMorgan Chase
Bank, N.A. A second plan is being pursued by Aurelius Capital
Management LP, on behalf of its managed entities; Deutsche Bank
Trust Company Americas, in its capacity as successor indenture
trustee for certain series of senior notes; Law Debenture Trust
Company of New York, in its capacity as successor indenture
trustee for certain series of senior notes; and Wilmington Trust
Company, in its capacity as successor indenture for the PHONES
Notes. Judge Kevin J. Carey has not issued a ruling on the plan.
Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy
News. The newsletter tracks the chapter 11 proceeding undertaken
by Tribune Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TRIBUNE CO: Wants Until Feb. 29 to Remove Causes of Action
----------------------------------------------------------
Tribune Co. and its affiliates ask the bankruptcy court to extend
to February 29, 2012, their time to file notices of removal of
claims and causes of action relating to their Chapter 11 cases.
Given the expiration of the Debtors' removal period on Oct. 31,
2011, the Debtors ask that the operation of Rule 9006-2 of the
Local Rules of Bankruptcy Practice and Procedure of the U.S.
Bankruptcy Court for the District of Delaware extend the time
during which the Debtors may remove actions from October 31, 2011
expiration until the time as this request will be heard by the
Court, which hearing is scheduled for November 22, 2011.
The Debtors made their request before the October 31, 2011
deadline to file notices of removal of actions expired.
Norman L. Pernick, Esq., at Cole, Schotz, Meisel, Forman &
Leonard, P.A., in Wilmington, Delaware, states that since the
Petition Date, the Debtors have devoted substantially all their
resources to stabilizing and operating their businesses,
addressing critical case management issues, evaluating and
resolving the prepetition claims against the Debtors, formulating
a plan of reorganization for the Debtors, and otherwise
facilitating the resolution of these Chapter 11 cases and the
Debtors' emergence therefrom. The plan process has been a
formidable undertaking for the Debtors, the Court and all parties
involved, he says.
Mr. Pernick further notes that the Debtors have made substantial
progress in addressing the prepetition claims asserted against
their estates. Since the Petition Date, the Debtors have filed
48 omnibus objections to claims, and numerous discrete objections
to individual prepetition litigation claims. Those actions have
collectively resulted in the disallowance or withdrawal of more
than 1,800 proofs of claim against the Debtors' estates. Various
other prepetition litigation claims have been the subject of
various orders or stipulations concerning relief from the
automatic stay, and those claims have been addressed accordingly.
The Debtors have continued to review their litigation-related
proofs of claim and to discuss potential resolutions of the
claims reflected therein, or to pursue objections thereto.
As a result of these tasks and their attendant demands on the
Debtors' personnel and professionals, the Debtors require
additional time to review their outstanding litigation matters
and evaluate whether those matters should properly be removed
pursuant to Rule 9027 of the Federal Rules of Bankruptcy
Procedure, Mr. Pernick stresses. Absent the proposed extension,
the Debtors would lose a potentially key element of their overall
ability to manage litigation during these Chapter 11 cases even
before that litigation would reasonably have been evaluated, to
the detriment of the Debtors, their estates, and their creditors,
he stresses.
Mr. Pernick assures the Court that preserving the Debtors'
ability to remove actions imposes no delay or unnecessary burden
on any counterparties to claims or other causes of action
relating to the Debtors' chapter 11 proceedings.
The Court will consider the Debtors' request on November 22,
2011. Objections are due no later than November 15.
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.
Two competing Chapter 11 plans are being pursued in the Chapter 11
cases of Tribune. One plan is being co-proposed by the Debtors,
the Official Committee of Unsecured Creditors, Oaktree Capital
Management, L.P., Angelo Gordon & Co., L.P. and JPMorgan Chase
Bank, N.A. A second plan is being pursued by Aurelius Capital
Management LP, on behalf of its managed entities; Deutsche Bank
Trust Company Americas, in its capacity as successor indenture
trustee for certain series of senior notes; Law Debenture Trust
Company of New York, in its capacity as successor indenture
trustee for certain series of senior notes; and Wilmington Trust
Company, in its capacity as successor indenture for the PHONES
Notes. Judge Kevin J. Carey has not issued a ruling on the plan.
Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy
News. The newsletter tracks the chapter 11 proceeding undertaken
by Tribune Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TRIBUNE CO: BNP Paribas, et al., Compelled to Produce Documents
---------------------------------------------------------------
At the behest of the Official Committee of Unsecured Creditors in
Tribune Co.'s cases, Judge Kevin Carey compelled production of
documents by defendants BNP Paribas Securities Corp., et al., to
get the names of former Tribune shareholders that may be sued for
collecting money related to the 2007 leveraged buyout, Bloomberg
News said.
Other defendants that are compelled to produce the documents are
Brown Brothers Harriman & Co.; Deutsche Bank Securities, Inc.;
Morgan Stanley & Co. LLC; Morgan Stanley Smith Barney; National
City Corp.; PNC Bank, N.A.; Pershing LLC; Swiss American
Securities, Inc.; TD Ameritrade Clearing, Inc.; UBS Financial
Services, Inc.; and UBS Securities LLC.
Before entry of the order, BNP Paribas, Morgan Stanley and
Pershing Square filed objections to the Creditors' Committee's
request.
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.
Two competing Chapter 11 plans are being pursued in the Chapter 11
cases of Tribune. One plan is being co-proposed by the Debtors,
the Official Committee of Unsecured Creditors, Oaktree Capital
Management, L.P., Angelo Gordon & Co., L.P. and JPMorgan Chase
Bank, N.A. A second plan is being pursued by Aurelius Capital
Management LP, on behalf of its managed entities; Deutsche Bank
Trust Company Americas, in its capacity as successor indenture
trustee for certain series of senior notes; Law Debenture Trust
Company of New York, in its capacity as successor indenture
trustee for certain series of senior notes; and Wilmington Trust
Company, in its capacity as successor indenture for the PHONES
Notes. Judge Kevin J. Carey has not issued a ruling on the plan.
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)
TRINITY INNOVATIVE: Ch. 7 Trustee's Suit v. DirectBuy Pared Down
----------------------------------------------------------------
Mary Martin, Chapter 7 Trustee for Trinity Innovative Enterprises,
LLC, v. DirectBuy, Inc., Beta Finance Company, Inc., UCC
TotalHome, Inc. and John Does 1 Through 10, No. 2:11CV135-PPS/APR
(N.D. Ind.), and other related cases also before the District
Court, involve the legal aftermath of a failed franchise.
DirectBuy operates a network of "buying clubs" through franchise
agreements. Trinity operated a DirectBuy franchise in Allentown,
Pennsylvania. Beta Finance, a DirectBuy associate, played a role
as the source of financing available to fund the membership fee
required of member/customers of Trinity's DirectBuy franchise.
After the failure of the business, Trinity filed a Chapter 11
petition. After conversion to Chapter 7 proceedings, Trinity's
Chapter 7 Trustee, Mary Martin, brought an adversary proceeding
making certain claims against DirectBuy and Beta. The bankruptcy
judge construed Counts I and II of Martin's first amended
complaint as state law claims and transferred that portion of the
case to the District Court to be heard in conjunction with the two
other cases arising from the same failed DirectBuy franchise.
DirectBuy and Beta have asked the District Court under
Fed.R.Civ.P. 12(b)(6) to dismiss Counts I and II.
In an Oct. 25, 2011 Opinion and Order, available at
http://is.gd/3jm538from Leagle.com, Chief District Judge Philip
P. Simon denied DirectBuy and Beta's request to dismiss as to
Count I and denied without prejudice as to Count II. The
Plaintiff is granted 21 days to file a second amended complaint in
which Count II is re-pled as a breach of contract claim.
Based in Allentown, Pennsylvania, Trinity Innovative Enterprises,
LLC, t/a DirectBuy of the Lehigh Valley, filed for Chapter 11
bankruptcy (Bankr. E.D. Pa. Case No. 09-20579) on March 6, 2009.
David F. Dunn, Esq. -- dunncourtpapers@choiceonemail.com -- at
David Dunn Law Offices PC, in Allentown, served as the Debtor's
counsel. In its Chapter 11 petition, the Debtor estimated
$1 million to $10 million in both assets and debts. On October 7,
2009, the Debtor's Chapter 11 case was converted to Chapter 7.
Mary Martin was appointed to serve as the Chapter 7 Trustee.
U.S. FIDELIS: Has Access to Mepco's Cash Collateral Until Dec. 31
-----------------------------------------------------------------
The Hon. Charles E. Rendlen of the U.S. Bankruptcy Court for the
Eastern District of Missouri authorized U.S. Fidelis, Inc., to use
the cash collateral of prepetition lender Mepco Finance
Corporation until Dec. 31, 2011.
The Debtor would use the cash collateral to fund post-shutdown
activities and case administration expenses.
As of the Petition Date, the Debtor was indebted to Mepco pursuant
to the Prepetition Loan Documents in the aggregate principal
amount of $17,727,396. Mepco also claimed that it is entitled to
accrued and unpaid interest through the Petition Date, but upon
the Debtor's information and belief Mepco has never rendered an
accounting of the interest and fees. Mepco filed a proof of claim
against the Debtor in the amount of $57,974,530. The Mepco POC
consisted of (i) the Mepco Petition Date Indebtedness plus (ii)
other amounts that Mepco asserts have become due since the
Petition Date on account of consumer cancelations and other
reasons.
As of Sept. 30, 2011, Mepco claimed $2,880,140 on account of the
DIP loans. Interest continued to accrue on that amount at the
rate of 4.75% percent per annum, or $383/day.
In addition, Mepco asserted that the Debtor has used approximately
$1.5 million of cash collateral since the Petition Date for which
Mepco has not been adequately protected.
The Debtor related that Mepco is already adequately protected
because the Debtor has on hand over $20 million in cash and the
amount of Mepco's DIP Loans is less than $2.9 million. As a
result, Mepco enjoys an equity cushion of over 680% and is
adequately protected. Even if the amount of the Inadequately
Protected Cash Collateral Usage is added to the total DIP Loans,
Mepco enjoys an equity cushion of over 500%.
As adequate protection for any diminution in value of the lenders'
collateral, the Debtor will grant Mepco replacement liens and
superpriority claim subject only to the carve-out.
On Oct. 13, the Court granted the Official Committee of Unsecured
Creditors' motion to amend cash collateral order for US Fidelis,
Inc.
About US Fidelis
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 (Bankr.
E.D. Mo. Case No. 10-41902) on March 1, 2010. Brian T. Fenimore,
Esq., and Crystanna V. Cox, Esq., at Lathrop & Gage L.C., in
Kansas City, Mo.; and Robert E. Eggmann, Esq., and Thomas H.
Riske, Esq., at Lathrop & Gage, in Clayton, Mo., assist the Debtor
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.
Allison E. Graves, Esq., and Brian Wade Hockett, Esq., at Thompson
Coburn LLP, in St. Louis, Mo., represent the Official Unsecured
Creditors Committee.
To date, no trustee or examiner has been appointed in this case,
but the Committee was appointed and has been an active participant
in the case.
US FT HOLDCO: Moody's Assigns 'B2' CFR; Outlook Stable
------------------------------------------------------
Moody's Investors Service assigned ratings to US FT Holdco, Inc.'s
debt -- Corporate Family Rating (CFR) and Probability of Default
Rating (PDR) of B2, and a B1 rating to the proposed $225 million
senior secured credit facilities. The rating outlook is stable.
This is the first time Moody's has assigned ratings to Fundtech's
debt.
RATINGS RATIONALE
The B2 CFR reflects Fundtech's high initial pro-forma debt to
EBITDA of about 5.5x (after Moody's adjustments), as well as
Fundtech's relatively small scale in an increasingly competitive
market segment. Moody's expects relatively weak financial
performance over the coming year as merger integration costs
reduce free cash flow, leaving only modest amounts of free cash
flow after the integration. This limits options for debt
reduction. Moody's also notes Fundtech's dependence on its bank
customers' IT budgets and the competitive threat posed by the
merger of ACI Worldwide and S1 Corp. Nonetheless, about 60% of
Fundtech's revenue base is recurring from hosting and maintenance
services, which adds some stability to Fundtech's revenue.
The stable outlook reflects Moody's expectation that Fundtech will
reduce debt to EBITDA to under 5.0x (after Moody's adjustments) by
the end of 2012 through EBITDA expansion and by using free cash
flow to reduce debt. The ratings could be lowered if Fundtech does
not make steady progress towards that target. Given the initial
leverage and modest free cash flow expectations, a ratings upgrade
is unlikely in the near to medium term.
The borrower is US FT Holdco, Inc., with the debt supported by
upstream guarantees from the domestic subsidiaries including
Fundtech Corp. and BServ, Inc. The B1 rating on the senior secured
credit facilities reflects the priority claim of the senior
secured credit facilities relative to other obligations because of
the security interest, and further supported by about $50 million
of subordinated debt. Fundtech is the entity resulting from BServ,
Inc.'s (BankServ) pending acquisition of Fundtech Ltd, a publicly
traded wire payments processing software company that primarily
serves large and mid-sized banks. BankServ, owned by private
equity firm GTCR, is a payments processor serving the US small
bank market.
These ratings were assigned:
Corporate Family Rating -- B2
Probability of Default Rating -- B2
Senior Secured Revolving Facility due 2016 -- B1 (LGD3 -- 39%)
Senior Secured First Lien Term Loan due 2017 -- B1 (LGD3 -- 39%)
Rating Outlook - stable.
The principal methodology used in rating Fundtech was the Global
Business & Consumer Service Industry Rating Methodology published
in October 2010. Other methodologies used include Loss Given
Default for Speculative Grade Issuers in the US, Canada, and EMEA,
published June 2009.
WAGSTAFF MINNESOTA: KFC Appeal Can't Bypass District Court
----------------------------------------------------------
District Judge Joan N. Ericksen denied the request of Wagstaff
Minnesota, Inc., et al., to bypass the District Court and instead
let the United States Court of Appeals for the Eighth Circuit hear
KFC Corporation's appeal from a final order of the Bankruptcy
Court. Judge Ericksen held that direct appeal presents attractive
benefits of convenience and efficiency. However, the Debtors'
case does not meet the relevant statutory standard.
Wagstaff Minnesota, et al., request certification under 28 U.S.C.
Section 158(d)(2) and Fed. R. Bankr. P. 8001(f) for a direct
appeal to the United States Court of Appeals for the Eighth
Circuit. KFCC opposes the request for certification.
The Debtors operate restaurants as KFCC franchisees. The Debtors
defaulted under the franchise agreements, KFCC terminated the
agreements, and the parties negotiated and executed a new set of
documents which form the basis of the dispute on appeal.
Specifically, the parties disagree as to whether this set of
documents should be considered one indivisible contract. All
briefings have been submitted to the District Court on the
substantive appeal.
The Debtors request certification for a direct appeal to the
Eighth Circuit because (1) the losing side at the district court
level is likely to appeal; (2) there is $50 million at stake for
the secured creditors plus some additional amount for the
unsecured creditors; (3) pendency of an appeal adds uncertainty to
the process of proposing and confirming a plan of reorganization
for the 77 restaurants affected by the reorganization.
The case before the District Court is, KFC Corporation, Appellant,
v. Wagstaff Minnesota, Inc., et al., Official Committee of
Unsecured Creditors of Wagstaff Minnesota, Inc., et al., General
Electric Capital Corporation, et al., Appellees, Civil No. 11-2450
(D. Minn.). A copy of the Court's Oct. 27, 2011 Order is
available at http://is.gd/xR1gVufrom Leagle.com.
About Wagstaff Properties
Hanford, California-based Wagstaff Properties LLC and its debtor-
affiliates filed for Chapter 11 protection (Bankr. D. Minn. Case
No. 11-43074) on April 30, 2011. The cases are jointly
administered with Wagstaff Minnesota, Inc. (Case No. 11-43073).
Bankruptcy Judge Nancy C. Dreher presides over the cases.
Fredrikson & Byron, PA, and Peitzman Weg & Kempinsky LLP,
represent the Debtors in their restructuring efforts. Alvarez &
Marsal North America LLC serves as the Debtors' financial advisor.
Trinity Capital, LLC and its affiliated broker-dealer, BWK Trinity
Capital Securities LLC, serve as the Debtors' investment banker
with respect to a sale of their assets. Epiq Bankruptcy Solutions
LLC provides administrative, noticing and balloting services.
Wagstaff Properties estimated assets and liabilities at
$10 million to $50 million.
On June 8, 2011, the U.S. Trustee appointed three member to the
Official Committee of Unsecured Creditors in the Debtors' cases.
Freeborn & Peters LLP and Lommen, Abdo, Cole, King & Stageberg
P.A. serve as the Committee's counsel.
WAINRIGHT BUILDING: Files for Bankruptcy to Avoid Foreclosure
-------------------------------------------------------------
Josh Brown at the Virginian-Pilot reports that Wainwright Building
LLC, an affiliate of Norfolk Property Development LLC, has filed
for Chapter 11 bankruptcy protection in federal court in Norfolk,
Virginia, late in October to avoid foreclosure on its property.
The Debtor owns the Wainwright office building at the corner of
Duke and Bute streets in downtown Norfolk, Virginia. According to
the Virginian-Pilot, court papers indicate the company has about
$23.2 million in liabilities and $4.3 million in assets.
According to the Virginian-Pilot, the company, backed by
developers Eric Menden and George Hranowskyj, fell behind on a
$7 million loan from CIBC World Markets Inc. earlier this year.
Rather than foreclose on the property, the lender opted last month
to sell the loan in an online auction. An advertisement for the
auction stated that the loan's balance was $6.5 million and that
the company had not made a full payment since January.
The report relates that the loan was purchased by WBG Financial
Investment & Capital LLC, a Virginia, Norfolk-based company that
was formed in October. WBG Financial purchased the loan as an
investment and had sought to foreclose on the property.
Mr. Brown notes WBG Financial will seek to lift the stay that was
placed on the foreclosure as a result of the bankruptcy filing.
Mr. Brown adds Marathon Development has been tapped to oversee the
ownership transition and handle rent payments from current
tenants.
According to the report, among the claims listed on the bankruptcy
filing is a $16 million loan from Southern Bank. That institution
took over many of the loans made by Bank of the Commonwealth,
which was closed by regulators last month. Other claims include
roughly $40,000 owed to Dominion Virginia Power for electrical
service and a $72,000 due Otis Elevator Co.
WINDRUSH SCHOOL: Kaufman Gets Vacation Pay; Director to Step Down
-----------------------------------------------------------------
Charles Burress at ElCerritoPatch reports that head of Windrush
School Ilana Kaufman has received $69,593 in cashed-out vacation
pay in two payments on July 31 and September 20, and director of
finance Enrico Hernandez is leaving the school on November 4 to
take another job.
According to the report, the board of trustee said on Sept. 27,
2011, the school must quickly raise between $800,000 and $900,000
in pledged donations to avert closure on Oct. 28, 2011. The
school has raised $867,000 in pledges and the trustees voted to
keep the school open the rest of this year at least, assuming it
can remain under bankruptcy protection from creditors.
Mr. Burress notes, at a hearing held by the U.S. Trustee's office
on Oct. 24, 2011, Matthew Kretzer, an attorney for the U.S.
Trustee's office who presided at the hearing, and Mike Buckley, an
attorney representing Wells Fargo, posed questions in a genial
manner to Ms. Kaufman, Mr. Hernandez and Merle Meyers, the
attorney representing Windrush. The papers filed by Windrush show
that the school paid the Meyers Law Group $150,000 in September.
About Windrush School
Based in El Cerrito, California, Windrush School is a private K-8
school. The Company filed for Chapter 11 protection on Sept. 30,
2011 (Bankr. D. N.D. Calif. Case No. 11-70440). Judge William J.
Lafferty presides over the case. Merle C. Meyers, Esq., at Meyers
Law Group PC, represents the Debtor. The Debtor estimated assets
and debts of between $10 million and $50 million.
Attorneys for secured lender Wells Fargo Bank N.A., are Mike C.
Buckley, Esq., James Neudecker, Esq., and Renee C. Feldman, Esq.,
at Reed Smith LLP. Wells Fargo is the Indenture Trustee on
$13 million of bonds issued by the California Statewide
Communities Development Authority to Windrush School.
WYNDHAM WORLDWIDE: Moody's Raises Sr. Unsec. Ratings From 'Ba1'
---------------------------------------------------------------
Moody's Investors Service upgraded Wyndham Worldwide's senior
unsecured ratings to Baa3 from Ba1. "The rating upgrade reflects a
modest improvement in credit metrics in 2011, and Moody's
expectations that revenues, earnings, and normalized free cash
flow will increase again in 2012", stated Senior Analyst, Peggy
Holloway. The rating upgrade also reflects a very good liquidity
profile that in Moody's view will enable Wyndham to better manage
through periods of market and economic volatility.
RATINGS RATIONALE
The ratings reflect Wyndham's leading market position in each of
its three business segments, the high margins and low capital
intensity of its fee for service hotel franchise and vacation
exchange and rentals segments that comprise around 50% of EBITDA.
The lower business risk profile of these segments, help mitigate
the higher risk profile of the timeshare development and finance
segment. The ratings also reflect the company's ability to
generate a high level of free cash flow that can support its
shareholder friendly financial policies, its very good liquidity
profile, and Moody's expectation the company will manage its
balance sheet in a manner that preserves credit metrics near
current levels.
Key credit concerns include an uncertain macro-economic
environment that could derail earnings growth, a financial policy
that is moderately aggressive, timeshare business risks -
including high default rates associated with timeshare consumer
receivables, and a reliance on the securitization market to
recycle consumer receivables so that capital can be made available
for other corporate objectives, including returns to shareholders.
The rating outlook is stable reflecting a good operating outlook
for each of Wyndham's business segments, Moody's expectations the
company will manage its cash flow and balance sheet to maintain
credit metrics near current levels, the company will continue to
manage the timeshare business for cash, and will support its share
repurchase program largely from free cash flow. The stable outlook
incorporates tolerance for a modest level of acquisition activity.
Wyndham's ratings could be upgraded if retained cash flow to net
debt exceeds 30% and can be sustained at this higher level, the
company continues to effectively manage its timeshare business for
cash, and support its share repurchases largely from cash flow.
Ratings could be downgraded if Wyndham's stated debt to EBITDA
financial policy target becomes more aggressive, it's retained
cash flow to net debt drops below 15%, or if the company does not
maintain sufficient liquidity to support its corporate spending
objectives.
Ratings upgraded
Senior Unsecured debt to Baa3 from Ba1 (LGD4, 63%)
Senior unsecured shelf to (P) Baa3 from Ba1 (LGD4, 63%)
Preferred shelf to (P) Ba1 from Ba2 (LGD6, 97%)
Ratings withdrawn
Corporate Family and Probability of Default ratings at Ba1
The principal methodology used in rating Wyndham Worldwide was the
Global Lodging & Cruise Industry Rating Methodology published in
December 2010.
Wyndham Worldwide Corporation (Wyndham) is one of the largest
hotel franchisors in the world and operates in three segments of
the hospitality industry: lodging, vacation exchange and rentals,
and vacation ownership. The company also develops and sells
vacation ownership (timeshare) intervals to individual consumers
and provides consumer financing in connection with these sales.
Wyndham generates annual revenues of about $4.2 billion.
XYIENCE INC: Plan Trustee Wins Sanctions Against Zyen, Fertitta
---------------------------------------------------------------
DAVID HERZOG, as Liquidating Trustee, v. ZYEN, LLC, a Nevada
limited liability company, FERTITTA ENTERPRISES, INC., a Nevada
corporation, WILLIAM BULLARD, ADAM FRANK, KIRK SANFORD, and OMER
SATTAR, Adv. Proc. No. 09-1402-MKN (Bankr. D. Nev.), seeks to
recover allegedly avoidable preferential and fraudulent transfers
and to recover damages claimed to have resulted from the
Defendants' participation in a dishonest 'loan to own' scheme,
which caused the Debtor to lose its assets. Under a 'loan to own'
scheme, a target entity is caused to borrow money on terms which
it cannot or will be prevented from repaying. In other words,
default is assured. The loan is secured by the assets of the
target, so the lender and its conspirators will be able to
foreclose and end up owning.
Zyen loaned $12,000,000 to Xyience in December 2007. The loan was
secured by all assets of Xyience. The Defendants are alleged to
have caused Xyience to default on the repayment of the loan from
Zyen, so that the assets of Xyience would pass to an entity
favored by the Defendants.
The Plaintiff seeks sanctions against the Defendants because of
their failure to establish a protective discovery hold on
documents related to the Defendants' business dealings with the
Debtor, erasure of documents that were electronically stored, and
the Defendants' failure to produce available business records with
reasonable promptness.
Defendant William Bullard is the chief financial officer of
Fertitta and a manager of Zyen. Defendants Adam Frank, Kirk
Sanford, and Omer Sattar, individuals, have settled with
Plaintiff.
In an Oct. 28, 2011 Memorandum Opinion, Bankruptcy Judge Lloyd
King granted the Plaintiff's Motion for Sanctions against Zyen,
Fertitta Enterprises, and William Bullard, as to monetary
sanctions only. The judge said the Defendants' willful, bad faith
discovery behavior justifies the imposition of monetary sanctions
to reimburse the Plaintiff's expenses, costs, and reasonable
attorney's fees. The sanctions are being imposed pursuant to the
Court's inherent power to supervise and control pending
litigation. Judge Lloyd directed the Plaintiff to file a
supplemental motion, requesting specific dollar amounts from the
three remaining defendants, together with an appropriate
justification for the requests. A copy of Judge Lloyd's decision
is available at http://is.gd/QyaCM3from Leagle.com.
The Defendants are represented by:
Gregory E. Garman, Esq.
GORDON SILVER
3960 Howard Hughes Pkwy., 9th Floor
Las Vegas, NV 89169
Telephone (702) 796-5555
Facsimile (702) 369-2666
E-mail: ggarman@gordonsilver.com
About Xyience Incorporated
Xyience Incorporated -- http://www.xyience.com/-- manufactures
sports nutrition products and related commodities, like an apparel
line. Xyience sells its energy drink through 230 convenience and
grocery stores, mostly in the Southwest. Known for its Xenergy
energy drink, Xyience is an Ultimate Fighting Championship sponsor
and signed a $15 million sponsorship agreement with the UFC for
2007.
Founder and former CEO Russell Pike, together with Prosperity
Investments Alliance LLC and other creditors, filed an involuntary
Chapter 11 petition against Xyience (Bankr. D. Nev. Case No.
08-10049) on Jan. 3, 2008. Mr. Pike listed $2,157,516 and
Prosperity listed $1,102,500 in unsecured claims. Marjorie A.
Guymon, Esq., at Goldsmith & Guymon PC, represents Mr. Pike and
the other creditors in the involuntary bankrupty petition.
The Debtor filed a voluntary petition under Chapter 11 (Bankr. D.
Nev. Case No. 08-10474) on Jan. 18, 2008. Laurel E. Davis, Esq.,
at Fennemore Craig PC, represents the Debtor in its restructuring
efforts. An Ad Hoc Committee Holding Unsecured Claims was
appointed in the case and represented by Jason C. Farrington,
Esq., at DLA Piper US LLP. The Debtor listed total assets of
$5,285,722 and total debts of $42,342,831.
A chapter 11 plan of reorganization was confirmed in the case.
David Herzog was appoint as liquidation trustee pursuant to the
confirmed plan and is responsible for pursuing the Debtor's
litigation claims.
ZENITH NATIONAL: S&P Lowers Counterparty Credit Rating to 'BB+'
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its counterparty credit
rating on Zenith National Insurance Corp. (Zenith) to 'BB+' from
'BBB-'. At the same time, Standard & Poor's lowered its
counterparty credit and insurer financial strength ratings
on Zenith's operating subsidiaries to 'BBB+' from 'A-'. The
outlook is positive.
"The downgrade reflects our view that Zenith's operating
performance will continue to be impaired by industrywide
inadequate pricing exacerbated by a high level and prolonged
period of joblessness," said Standard & Poor's credit analyst
Patricia Kwan. "We believe Zenith will continue to experience
adverse loss development, coupled with a high expense ratio as a
result of diminished scale."
Zenith had historically demonstrated strong underwriting
performance relative to peers. However, operation profitability
has significantly deteriorated over recent years. In 2010,
Zenith's statutory combined ratio (including policyholder's
dividend) and return on revenues (ROR) were 132% and negative
15.1% compared with 114% and 4.4% in 2009. As of Sept. 30, 2011,
Zenith reported a combined ratio and ROR of 126% and negative 16%,
respectively, compared with 124% and negative 9% over the same
period in 2010. At year-end 2010, Zenith reported a statutory
pretax operating loss of $74 million, down from a pretax operating
income of $24 million in 2009, $179 million in 2008, and $342
million in 2007. Statutory pretax operating loss (excluding
realized gains and losses) was $53 million as of Sept. 30, 2011,
compared with a statutory pretax operating loss of $30 million
over the same period of 2010. As part of its loss control and
value-add service strategy, Zenith maintains in-house health,
safety, legal, claims, medical management, and billing
professionals, which resulted high internal expenses.
Consequently, the diminished premium volume has raised the expense
ratio over the past two years. Moreover, Zenith has also
experienced adverse loss development.
"The positive outlook reflects our view of Zenith's importance to
the group, which incorporates Zenith's capitalization relative to
that of the consolidated group and the company's business and
operation in geographic regions consistent with Fairfax's growth
strategy," S&P said.
Standard & Poor's expects Zenith to report about a 15% increase in
net premium written in 2011 because of overall rate increases and
expansion in the agricultural business. "For 2011 through 2012, we
expect the company to generate a statutory combined ratio between
125% and 130% (including policyholders dividend and reserve
development), with no pretax return on revenue (excluding realized
gains and losses)," S&P related.
"We also expect that Zenith will remain strongly capitalized at
the 'AAA' level, reflecting the company's long-term strategy of
managing insurance risk in a highly volatile and concentrated
market," S&P said.
"Given Zenith's business profile and its proximity with the macro
dynamic in California and Florida, we are unlikely to raise the
ratings over the next 24 months," S&P said. However, S&P will
reassess the rating if:
The company does not meet our expectations (specifically, if
the 2011 through 2012 statutory combined ratio is more than
130%, including adverse reserve development and policyholder
dividend); or
Its financial position weakens (such as capital adequacy
falling below the 'AAA' level).
The rating on Zenith is one-notch below the parent and will move
in tandem with the financial strength rating of Fairfax.
* Class Suit Pending Over Freeze on Joint Bank Accounts
-------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that a lawsuit is brewing in federal court in New Jersey
intended to take banks to task for freezing joint accounts when
only one of the account holders files bankruptcy.
According to Mr. Rochelle, the suit involved a mother and daughter
with a joint account at Wells Fargo Bank NA. The complaint alleges
that only the mother ever made deposits into or withdrawals from
the account. The joint account was likely set up so the daughter
would automatically become the owner of all the funds in the
account in the event of the mother's death. After the mother sold
her home and deposited almost $400,000 into the account, the
daughter filed bankruptcy. The bank froze the entire account and
notified the bankruptcy trustee who proceeded to claim half the
funds in the account. The mother hired lawyers and eventually
received all her money. The mother then filed a class-action suit
on behalf of nonbankrupt holders of joint accounts, seeking
actual, compensatory and punitive damages for "unconscionable
conduct" and violation of New Jersey law.
The report relates that Wells Fargo filed a motion to dismiss that
was denied on Oct. 28 by U.S. District Judge Anne E. Thompson in
Newark, New Jersey. Early in the case, Judge Thompson said the
complaint alleged facts sufficient to withstand attack. New
Jersey law says that funds in a joint account belong "to the
parties in proportion to the net contributions by each to the sums
on deposit." The presumption of half-ownership by each applies
only in absence of "proof as to who contributed to the account,"
Judge Thompson said.
The case is Coiro v. Wachovia Bank NA, 11-3587, U.S. District
Court, District of New Jersey (Newark).
* J.H. Cohn and Kostin Ruffkess Agree on Merger
-----------------------------------------------
J.H. Cohn LLP and Kostin, Ruffkess & Company, LLC, have signed an
agreement to combine. The combination will make J.H. Cohn the
dominant regional firm serving the Connecticut and Western
Massachusetts marketplace with offices in Glastonbury, Farmington,
New London, and Stamford, Conn., and Springfield, Mass.
Terms of the deal were not disclosed.
Aaron Elstein at Crain's New York Business reports that J.H. Cohn
is the nation's 17th-largest accounting firm, according to
Accounting Today, and reported $236 million in revenues for the
fiscal year ending Jan. 31. It has 150 partners.
Kostin Ruffkess was founded in 1949 and specializes in accounting
and tax services as well as forensic accounting, business
valuation, and business consulting. Kostin Ruffkess had $20
million in revenue last year and has 18 partners.
As part of the merger, Kostin Ruffkess will operate as J.H. Cohn
LLP.
Crain's reports that the new firm will still be smaller in
comparison to any of the Big Four firms that dominate the
business. The nation's largest accounting operation by revenue,
New York-based Deloitte, had nearly $11 billion in revenue last
year and about 2,900 partners.
According to a press statement, the combination will provide
Kostin Ruffkess? clients and professionals with access to J.H.
Cohn?s highly personalized approach to client service, technical
and industry expertise, strategic insight, and its dedication to
community service, while reinforcing J.H. Cohn?s commitment to
strengthening its ability to serve clients throughout New England.
The combined firm will also have enhanced depth in the
construction, manufacturing and distribution, real estate,
municipal, and not-for-profit industry sectors. Both firms also
have strong employee benefits practices.
?This combination will enable us to more efficiently and
effectively serve the New England market by providing deeper
resources and broader areas of expertise than to which either of
us previously had access,? said Thomas J. Marino, CPA, chief
executive officer of J.H. Cohn. ?It is truly a win-win situation
for our clients, our staff, and our partners.?
?We believe the technical expertise and culture of both firms
create widespread synergies that will benefit businesses
throughout the New England community. We particularly admire J.H.
Cohn?s emphasis on partner-level involvement with their clients,
dedication to deep industry specialization, diversified tax
credentials, and commitment to giving back to the community,? said
Ed Kindelan, CPA, of Kostin Ruffkess who will serve as office
managing partner of J.H. Cohn?s Farmington, New London, and
Springfield offices.
Frank Longobardi, CPA, J.H. Cohn?s regional managing partner, New
England, emphasized, ?The growth of our team is important to
serving the complex needs of owner-managed privately held
companies, public companies, private equity funds, and not-for-
profit organizations. As regulatory and economic conditions
continue to change, our clients increasingly look to us for
capital markets guidance and ?best of breed? industry expertise.?
J.H. Cohn?s expansion also includes the opening of a new office in
Stamford, CT in September to support their growing metro-New York
and New England practices and their continuing commitment to the
private equity and hedge fund communities.
* Michael C. Sullivan Joins Deloitte's Reorganization Practice
--------------------------------------------------------------
Deloitte Financial Advisory Services LLP on Oct. 31 disclosed that
it has expanded its reorganization services practice with the
addition of Michael C. Sullivan as a director in the Northeast
region.
Mr. Sullivan has extensive experience in analyzing businesses for
companies and creditor groups in restructurings. He has worked on
behalf of debtors, secured and unsecured creditors, as well as
trustees. At Deloitte, Mr. Sullivan will focus on delivering
fresh start reporting and other debtor advisory services to
clients nationwide.
Prior to joining Deloitte, Mr. Sullivan was a managing director
for a publically traded consulting firm that he founded and where
he led the fresh start reporting practice. He also has
significant experience in performing forensic accounting studies,
fraud investigations and post-acquisition purchase price disputes.
He has analyzed damage claims before Federal and state courts as
well as arbitration panels.
Mr. Sullivan is a Certified Insolvency and Restructuring Advisor
and a Certified Public Accountant licensed in New Jersey and New
York. He is a member of the Association of Insolvency and
Restructuring Advisors, the American Institute of Certified Public
Accountants and the New Jersey Society of Certified Public
Accountants. Mr. Sullivan earned his bachelor's degree from
Villanova University.
About Deloitte
Deloitte Financial Advisory Services LLP, a subsidiary of Deloitte
LLP -- http://www.deloitte.com/-- advises clients on managing
business controversy and disputes, executing deals, and
maintaining regulatory compliance.
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
Nov. 28, 2011
BEARD GROUP, INC.
18th Annual Distressed Investing Conference
The Helmsley Park Lane Hotel, New York City
Contact: 1-240-629-3300
Dec. 1-3, 2011
AMERICAN BANKRUPTCY INSTITUTE
23rd Annual Winter Leadership Conference
La Quinta Resort & Spa, La Quinta, Calif.
Contact: 1-703-739-0800; http://www.abiworld.org/
April 3-5, 2012
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
Grand Hyatt Atlanta, Atlanta, Ga.
Contact: http://www.turnaround.org/
Apr. 19-22, 2012
AMERICAN BANKRUPTCY INSTITUTE
Annual Spring Meeting
Gaylord National Resort & Convention Center,
National Harbor, Md.
Contact: 1-703-739-0800; http://www.abiworld.org/
July 14-17, 2012
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Workshop
The Ritz-Carlton Amelia Island, Amelia Island, Fla.
Contact: 1-703-739-0800; http://www.abiworld.org/
Aug. 2-4, 2012
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Workshop
Hyatt Regency Chesapeake Bay, Cambridge, Md.
Contact: 1-703-739-0800; http://www.abiworld.org/
November 1-3, 2012
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Westin Copley Place, Boston, Mass.
Contact: http://www.turnaround.org/
Nov. 29 - Dec. 2, 2012
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
JW Marriott Starr Pass Resort & Spa, Tucson, Ariz.
Contact: 1-703-739-0800; http://www.abiworld.org/
April 10-12, 2013
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
JW Marriott Chicago, Chicago, Ill.
Contact: http://www.turnaround.org/
October 3-5, 2013
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Wardman Park, Washington, D.C.
Contact: http://www.turnaround.org/
*********
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.
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