/raid1/www/Hosts/bankrupt/TCR_Public/120327.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Tuesday, March 27, 2012, Vol. 16, No. 86
Headlines
10717 LLC: Files for Chapter 11 in Brooklyn
ADINO ENERGY: Delays 2011 Annual Report on Form 10-K
ANADARKO PETROLEUM: Moody's Raises Sr. Unsec. Rating From 'Ba1'
BANNING LEWIS: Disclosure Statement Hearing Adjourned Sine Die
BARNWELL HOSPITAL: To Seek Chapter 9 Plan Confirmation April 30
BERNARD L. MADOFF: Trustee Sues Schroders and Banca Del Gottardo
BLITZ USA: Seeks June 6 Extension of Lease Decision Deadline
BLITZ USA: Wants Exclusive Periods Extended to June 6
BLUE SPRINGS FORD: Jury Verdict Prompts Dealership's Ch. 11 Filing
CAMBIUM LEARNING: Moody's Changes Outlook on 'B2' CFR to Negative
CC LLC: Baymont Inn Files for Chapter 11 in Tampa
CENTRAL FEDERAL: Rights Offering Extended Until April 17
CONTRACT RESEARCH: Files for Chapter 11 With Plans to Sell
COVENANT BANK & TRUST: Closed; Stearns Bank Assumes Deposits
CRYSTALLEX INT'L: Gets $36-Mil. DIP Financing After Auction
CRYSTALLEX INT'L: To Default on Canadian Disclosure Filing Rules
DEX MEDIA EAST: Bank Debt Trades at 49% Off in Secondary Market
DEX MEDIA WEST: Bank Debt Trades at 39% Off in Secondary Market
CURTIS GORDON: Court Dismisses Prisoner's Chapter 11 Case
DELTA PETROLEUM: Bid Deadline, Auction Date Moved to April
DEX ONE: Has Tender Offer for Outstanding 12%/14% Senior Notes
DIPPIN' DIPS: Settles Dispute with Regions; $1.2MM Loan Okayed
DRI CORP: Bus-Sign Maker Files Bankruptcy to Sell Business
DRI CORP: Case Summary & 20 Largest Unsecured Creditors
EL CENTRO MOTORS: Ford-Lincoln Dealer Files Ch. 11 in San Diego
EMISPHERE TECHNOLOGIES: Has $8.14-Mil. Operating Loss in 2011
EMPIRE RESORTS: Ernst & Young Replaces Friedman as Accountant
EMPRESAS INTEREX: Court OKs Carrasquillo as Financial Consultant
EMPRESAS INTEREX: Court OKs Cuprill Law Office as Bankr. Counsel
FGIC CORP: Plan Confirmation Hearing Set for April 19
FULLER BRUSH: Hires Foulston as Intellectual Property Lawyer
GELT PROPERTIES: Can Access Cash Collateral Until March 31
GELT PROPERTIES: Disclosure Statement Hearing Moved to April 11
GELT PROPERTIES: Bank Says Claim Understated, Wants Stay Lifted
GETTY PETROLEUM: To Terminate Leases on 56 Stations
GIBSON AND EPPS: Obtains Relief From Agreed Dismissal Order
GRUBB & ELLIS: Competitors Eyeing Building Management Contracts
HARRON COMMS: Moody's Rates $225MM Senior Unsecured Bonds 'Caa1'
HAWKER BEECHCRAFT: Bank Debt Trades at 26% Off in Secondary Market
HAWKER BEECHCRAFT: Bank Debt Trades at 26% Off in Secondary Market
HOMER CITY: Fitch Lowers Rating on $830 Million Bonds to 'B'
HORNE INTERNATIONAL: Marla Perdue Appointed Interim CFO
INOVA TECHNOLOGY: Incurs $657,000 Net Loss in Jan. 31 Quarter
IMPERIAL PETROLEUM: Incurs $7.1 Million Net Loss in Jan. 31 Qtr.
JEFFRIE LONG: Valleycrest Response Deadline Moved to April 2
INDIANAPOLIS DOWNS: Loan Maturity Extended One Year
INFUSYSTEM HOLDINGS: Says Covenant Violation Looms
INTERNATIONAL MEDIA: Sold in $45 Million Debt Swap
INTERNATIONAL MEDIA: Gets Nod to Hire BCWS as Tax Consultants
INTERNATIONAL MEDIA: Court Okays Landis Rath as Bankruptcy Counsel
LANDMARK INVESTORS: Court OKs Raymond Aver as Insolvency Counsel
LEHMAN BROTHERS: Seeks Disallowance of $25MM Highbridge Claim
LEHMAN BROTHERS: LBF Fight Affecting Swiss Financial Practices
LEHMAN BROTHERS: NC Says BNY Broke Deal With $95-Mil. Buy
LEHMAN BROTHERS: Principal Life Cancels Set-Off Motion
LI-ON MOTORS: Incurs $2.1 Million Net Loss in Jan. 31 Quarter
LIGHTSQUARED INC: Bank Debt Trades at 57% Off in Secondary Market
LOCATION BASED TECH: Has At Least $500K Funding from Investor
LOS ANGELES DODGERS: Three Bidders in Final Round
LOS GATOS HOTEL: Can Use Lender's Cash Until July 1
LOS GATOS HOTEL: Plan Confirmation Hearing Set for April 20
MCC HUMBLE: Court Won't Convert or Dismiss for Now
MEDIA GENERAL: Incurs $74.3 Million Net Loss in Fiscal 2011
METRO-GOLDWYN-MAYER: 2011 Revenues Up; Liguori Joins Board
MICHAELS STORES: Reports $176 Million Net Income in Fiscal 2012
MICROBILT CORP: Plan Solicitation Exclusivity Extended 60 Days
MICROBILT CORP: Taps Nagel Rice to Probe Claims vs. Law Firm
MONEYGRAM INT'L: Names Carl-Olav Scheible EVP Europe, Africa
MONEYGRAM INT'L: Appoints Alex Holmes as Chief Financial Officer
NEBRASKA BOOK: Given Approval for Severance Program
NEOMEDIA TECHNOLOGIES: Global Grid Discloses 25.9% Equity Stake
NEUROLOGIX INC: George Miller Named Bankruptcy Trustee
NUVILEX INC: Incurs $272,000 Net Loss in Jan. 31 Quarter
PHILIP LIVELY: 5th Cir. to Review BACPA Rule for Individual Cases
PINNACLE FOODS: Moody's Rates $550-Mil. Credit Facilities 'Ba3'
PMI GROUP: Asks Court to Extend Plan Filing Deadline to May 21
PREMIER BANK: Closed; Int'l Bank of Chicago Assumes All Deposits
PRIME HEALTHCARE: Moody's Issues Summary Credit Opinion
RADIO ONE: Incurs $14.4MM Consolidated Net Loss in Fourth Quarter
RESIDENTIAL CAPITAL: Hedge Fund Advises Against Bankruptcy Filing
RICHARD FRIEDBERG: Court Sustains Objection to P&O Claim
RP SAM: Case Transferred to Santa Ana Division
SCHOMAC GROUP: Court Approves Disclosure Statement
SHOREBANK CORP: U.S. Trustee Forms Unsecured Creditors Committee
SOUTHERN SKY: Direct Air Should Be Liquidated, U.S. Trustee Says
SPARTA COMMERCIAL: Incurs $615,900 Net Loss in Jan. 31 Quarter
SPOT MOBILE: Incurs $4.5 Million Net Loss in 2011
SPRINGLEAF FINANCE: Bank Debt Trades at 9% Off in Secondary Market
STRATEGIC AMERICAN OIL: Incurs $291,877 Net Loss in Fiscal Q2
SUPERMEDIA INC: Board Approves $100,000 Bonus for CEO & EVP Sales
TELVUE CORP: Completes Debt Conversion Transaction & Stock Split
TRIBUNE CO: Bank Debt Trades at 33% Off in Secondary Market
TXU CORP: Bank Debt Trades at 43% Off in Secondary Market
THUNDERBIRD MINING: PBGC Termination of Pension Plan Valid
WAGSTAFF MINNESOTA: Wants to Hire M. Green as Accountant
WAGSTAFF MINNESOTA: Has Until June 30 to Propose a Chap. 11 Plan
WASTE2ENERGY HOLDINGS: Heading for Auction, No Buyer Signed Yet
WAXESS HOLDINGS: Incurs $9.4 Million Net Loss in 2011
WESTERN COMMUNICATIONS: Court Approves Disclosure Statement
* New Bankruptcy Judges in Brooklyn and Rochester, New York
* Georgia, Illinois Banks Raise Failures to 15 This Year
* S&P's Global Default Tally at 24 as of March 21
* Large Companies With Insolvent Balance Sheets
*********
10717 LLC: Files for Chapter 11 in Brooklyn
-------------------------------------------
Brooklyn, New York-based 10717 LLC filed a Chapter 11 bankruptcy
petition (Banrk. E.D.N.Y. Case No. 12-41998) on March 21.
The Debtor says it has total assets of $14.0 million and total
debts of $14.35 million. It owns 18 acres of land in the town
of Thompson, Sullivan County, New York. The property secures a
$1.3 million debt. 135 Bowery LLC, which has a $3.4 million
disputed claim, sits atop the list of creditors holding unsecured
nonpriority claims. A copy of the schedules attached to the
petition is available for free at
http://bankrupt.com/misc/nyeb12-41998.pdf
The Debtor is represented by Bruce Weiner, Esq., at Rosenberg
Musso & Weiner LLP, in Brooklyn.
According to the docket, the Chapter 11 plan and explanatory
disclosure statement are due July 19, 2012.
ADINO ENERGY: Delays 2011 Annual Report on Form 10-K
----------------------------------------------------
Adino Energy Corporation informed the U.S. Securities and Exchange
Commission that it will be late in filing its annual report on
Form 10-K for the period ended Dec. 31, 2011. The Company is
compiling additional information required for its exploration and
production operations. It is unlikely that the Company will be
able to compile this information without unreasonable effort or
expense by the filing date.
About Adino Energy
Based in Houston, Texas, Adino Energy Corporation (OTC BB: ADNY)
-- http://www.adinoenergycorp.com/-- through its wholly owned
subsidiary Intercontinental Fuels, LLC, specializes in fuel
terminal operations for retail, wholesale, and governmental
suppliers.
The Company reported a net loss of $851,570 for the nine months
ended Sept. 30, 2011, compared with a net loss of $84,134 for the
same period during the prior year. It incurred a net loss of
$277,800 in 2010, following net income of $23,000 in 2009.
The Company's balance sheet at Sept. 30, 2011, showed
$3.55 million in total assets, $6.57 million in total liabilities,
and a $3.01 million total stockholders' deficit.
As reported by the TCR on April 8, 2011, M&K CPAS, PLLC, in
Houston, Texas, expressed substantial doubt about the Company's
ability to continue as a going concern, following the 2010
financial results. The independent auditors noted that the
Company has suffered recurring losses from operations and
maintains a working capital deficit.
ANADARKO PETROLEUM: Moody's Raises Sr. Unsec. Rating From 'Ba1'
---------------------------------------------------------------
Moody's Investors Service upgraded Anadarko Petroleum Corporation
and its guaranteed subsidiaries' senior unsecured ratings to Baa3
from Ba1. The outlook is stable. This action concludes the ratings
review of Anadarko that was initiated on October 17, 2011
following the company's announced $4 billion settlement agreement
with BP p.l.c. (BP, A2 stable) related to the 2010 Macondo well
blowout in the Gulf of Mexico.
Ratings Rationale
"The upgrade of Anadarko to Baa3 reflects the company's strong
operating momentum and cash flow visibility for repaying the debt
incurred to fund the BP settlement," commented Pete Speer, Moody's
Vice President. "While contingent liabilities remain related to
Macondo and Tronox, we believe that the company has sufficient
liquidity and marketable assets to manage through these issues
without adversely affecting its investment grade ratings."
Anadarko's Baa3 ratings are supported by its proved reserve and
production scale that is among the largest of all independent
exploration and production (E&P) companies and comparable to Baa1
and A3 rated peers. The company's credit profile benefits from
having 32% of its production from oil and 11% from natural gas
liquids that support its cash flows in this weak natural gas price
environment. The asset base also has good basin diversity in the
US along with international diversification provided through
working interests in numerous major offshore oil and gas
developments.
These credit strengths are tempered by high debt levels relative
to proved developed (PD) reserves and production volumes. Debt/PD
and debt/average daily production were approximately $9/boe and
$25,000/boe, respectively, at December 31, 2011. Anadarko funded
$2.5 billion of the $4 billion settlement with BP in the fourth
quarter of 2011 through borrowings on its revolving credit
facility. Moody's expects those borrowings to ultimately be repaid
through free cash flow in 2012 and the $1.8 billion recoupment to
be received in 2012 and 2013 related to the company's recently
announced settlement with Sonatrach. This will lower the company's
leverage metrics to more comfortable levels for the Baa3 rating.
Anadarko still has some exposure to Macondo liabilities that are
not covered by its indemnification from BP, including potential
fines and penalties under the Clean Water Act. The company also
has a contingency related to the Tronox litigation for which it
recently accrued $250 million. While there is inherent uncertainty
in litigation matters, Moody's believes that Anadarko's $2.7
billion of cash and $2.1 billion of committed revolver capacity
provides more than sufficient liquidity for these issues and its
operations. The company is also pursuing asset sales, potentially
including properties in Brazil and Indonesia, that should provide
significant additional cash for these matters or further debt
reduction.
The company's current $5 billion revolving credit facility is
senior secured. Moody's expects Anadarko to replace this facility
in the near term with new senior unsecured credit facilities to
eliminate the secured debt in the capital structure. The stable
outlook is based on the company meeting its free cash flow targets
and repaying its Macondo related borrowings by the middle of 2013.
If Anadarko is able to resolve its contingencies and significantly
reduce its leverage metrics through asset sales then the ratings
could be upgraded. Debt/PD and debt/average daily production
sustained below $8/boe and $20,000/boe could be supportive of an
upgrade to Baa2. Significant increases in leverage due to weaker
free cash flow than anticipated or if Anadarko incurs a much
higher cost than expected related to its contingencies then the
ratings could be downgraded. Debt/PD and debt/average daily
production sustained above $10/boe and $27,000/boe could result in
a downgrade.
Moody's current ratings on Anadarko Petroleum Corporation and its
affiliates are:
Anadarko Petroleum Corporation
Senior Unsecured (domestic currency) Rating of Baa3
Senior Unsec. Shelf (domestic currency) Rating of (P)Baa3
BACKED Senior Unsecured (domestic currency) Rating of Baa3
Pref. Shelf (domestic currency) Rating of (P)Ba1
Pref. Stock (domestic currency) Rating of Ba1
BACKED Pref. Shelf (domestic currency) Rating of (P)Ba1
Kerr-McGee Corporation
Senior Unsecured (domestic currency) Rating of Baa3
BACKED Senior Unsecured (domestic currency) Rating of Baa3
Union Pacific Resources Group Inc.
BACKED Senior Unsecured (domestic currency) Rating of Baa3
Anadarko Petroleum Capital Trust I
Pref. Shelf (domestic currency) Rating of (P)Ba1
Anadarko Petroleum Capital Trust II
BACKED Pref. Shelf (domestic currency) Rating of (P)Ba1
Anadarko Petroleum Capital Trust III
BACKED Pref. Shelf (domestic currency) Rating of (P)Ba1
Anadarko Finance Company
BACKED Senior Unsecured (domestic currency) Rating of Baa3
The principal methodology used in rating Anadarko Petroleum was
the Global Independent Exploration and Production Industry
Methodology published in December 2011.
Anadarko Petroleum Corporation is headquartered in The Woodlands,
Texas, and is among the largest independent exploration and
production companies.
BANNING LEWIS: Disclosure Statement Hearing Adjourned Sine Die
--------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that according to court records, a hearing to approve a
disclosure statement for Banning Lewis Ranch Co. was adjourned to
a date "to be determined."
As reported in the March 15, 2012 edition of the Troubled Company
Reporter, the Hon. Kevin J. Carey has dismissed the Chapter 11
case of Banning Lewis Ranch Development I & II, LLC, also known as
Devco.
According to Mr. Rochelle, Devco said it had only minimal assets
remaining and no ability to pay claims. The dismissal order
provided for distribution of about $30,000 among creditors with
debts arising during bankruptcy. The Devco assets, or the 2,700-
acre northern portion of Banning Lewis Ranch, were sold for $24.5
million to KeyBank NA as agent for lenders who bought the land in
exchange for secured debt.
As reported by the TCR, the southern portion of the project,
brought in a high bid of $26.25 million from Ultra Resources Inc.
About Banning Lewis
The Banning Lewis Ranch Co. was the owner of the undeveloped
portion of a 21,000-acre ranch in Colorado Springs, Colo. The
Banning Lewis Ranch was a master-planned community in Colorado
Springs, Colorado. The first section built, the 350-acre
Northtree Village, opened in September 2007 and was to have 1,000
homes priced from the high $100,000s to the mid-$300,000s.
The Banning Lewis Ranch filed for Chapter 11 bankruptcy protection
from creditors (Bankr. D. Del. Case No. 10-13445) on Oct. 28,
2010. It estimated assets of $50 million to $100 million and
debts of $100 million to $500 million in its Chapter 11 petition.
An affiliate, The Banning Lewis Ranch Development I & II, LLC,
also filed for Chapter 11 (Bankr. D. Del. Case No. 10-13446).
Kevin Scott Mann, Esq., at Cross & Simon, LLC, serves as counsel
to the Debtors. Edward A. Phillips of Eisner Amper LLP has been
retained as the Company's chief restructuring officer.
BARNWELL HOSPITAL: To Seek Chapter 9 Plan Confirmation April 30
---------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Barnwell County Hospital and Bamberg County Memorial
Hospital, both in South Carolina, are scheduled to confirm their
Chapter 9 municipal bankruptcy plans on April 30 in U.S.
Bankruptcy Court in Columbia, South Carolina. Both hospitals will
be acquired by the SC Regional Health System LLC, which intends to
build a new state-of-the-art 25-bed hospital to serve both
counties.
According to the disclosure statement, the Barnwell Plan is
premised upon the Asset Purchase Agreement between the Debtor and
SC Regional Health System, LLC, under which RHS will acquire
substantially all of the operating assets of the Debtor free of
any liens. Barnwell is to close and operate temporarily as a
part-time clinic. Unsecured creditors of Barnwell are expected to
recover 2 percent to 5 percent. A full-text copy of the
Disclosure Statement is available for free
at http://bankrupt.com/misc/BARNWELL_COUNTY_ds.pdf
In Bamberg's Plan, creditors will recover 15% to 20%. Bamberg
will remain operating for about three years, until the new
regional hospital is constructed.
About Bamberg County Memorial Hospital
Bamberg County Memorial Hospital, in Bamberg, South Carolina,
filed for Chapter 9 bankruptcy (Bankr. D. S.C. Case No. 11-03877)
on June 20, 2011. Stanley H. McGuffin, Esq. at Haynsworth Sinkler
Boyd, P.A., serves as the Debtor's counsel. In its petition, the
Debtor estimated $1 million to $10 million in assets and $1
million to $10 million in debts. The petition was signed by
Danette D. McAlhaney, MD, chairman.
About Barnwell County Hospital
Barnwell County Hospital in South Carolina filed for municipal
reorganization under Chapter 9 of the Bankruptcy Code (Bankr. D.
S.C. Case No. 11-06207) on Oct. 5, 2011, in Columbia, South
Carolina. The hospital is licensed for 53 beds, although only 31
are currently operating. It also operates three rural health
clinics in southwestern South Carolina. The hospital said it
filed because the county said it's no longer willing or able to
fund losses. The hospital has no bonded debt. Assets and debts
are both less than $10 million.
Judge David R. Duncan oversees the case. Lindsey Carlbert
Livingston, Esq., and Stanley H. McGuffin, Esq., at Haynsworth
Sinkler Boyd, PA, represent the Debtor as counsel. The petition
was signed by Charles Lowell Jowers, Sr., chairman of the
hospital's board of trustees.
W. Clarkson McDow, Jr., the U.S. Trustee for Region 4, appointed
three unsecured creditors to serve on the Official Committee of
Unsecured Creditors of Barnwell County Hospital.
BERNARD L. MADOFF: Trustee Sues Schroders and Banca Del Gottardo
----------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the trustee liquidating Bernard L. Madoff Investment
Securities Inc. sued a subsidiary of Schroders PLC and the
successor to Banca del Gottardo. The trustee is suing Schroder &
Co. Bank AG for $30.4 million while BSI AG, as successor to Banca
del Gottardo, is being asked to return $56.4 million. Both
received funds initially paid out by the Madoff firm to the
Fairfield Sentry Ltd. feeder fund, according to the Madoff
trustee. The trustee is suing them as subsequent recipients of
fraudulently transferred funds received from Fairfield Sentry
within six years of the Madoff firm's bankruptcy.
Mr. Rochelle notes that the suits, like others previously, was
made possible by a settlement in June between Picard and
Fairfield's liquidators from the British Virgin Islands. In the
settlement, the liquidators and the Madoff trustee agreed how to
split up recoveries against investors in the Fairfield funds. In
addition, the Madoff trustee received a $3.05 billion judgment
against the Fairfield funds.
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 Feb. 17, 2012 and in the 38 months since his appointment,
the SIPA Trustee has recovered or entered into agreements to
recover more than $9 billion, representing roughly 52% of the
roughly $17.3 billion in principal estimated to have been lost in
the Ponzi scheme by BLMIS customers who filed claims. The
recoveries exceed prior restitution efforts related to Ponzi
schemes both in terms of dollar value and percentage of stolen
funds recovered. Pro rata distributions from the Customer Fund to
BLMIS customers whose claims have been allowed by the SIPA Trustee
totaled $325.7 million.
Mr. Picard has filed 1,000 lawsuits seeking $100 billion from
banks such as HSBC Holdings Plc and JPMorgan Chase & Co. The
trustee has seen more than $28 billion of his claims tossed by
district judges.
BLITZ USA: Seeks June 6 Extension of Lease Decision Deadline
------------------------------------------------------------
Blitz U.S.A. Inc. asks the U.S. Bankruptcy Court to extend the
120-day period for the Debtors to assume or reject unexpired non-
residential real property leases for another 90 days, through and
including June 6, 2012, as the Debtors are not in the position to
make a decision as to the treatment of the Leases. The Debtors
initial period to assume or reject the Leases was scheduled to
expire March 8, 2012.
While the Debtors do not lease any real property from third-party
landlords, there are a number of non-residential real property
leases between the Debtors themselves.
The Debtors are in the process of selling their assets relating to
the business line of F3 Brands LLC. Accordingly, the Debtors must
wait until the conclusion of this sale process to identify the
ultimate purchaser of the F3 Assets and to determine what the
purchaser's intentions will be with respect to any Leases relating
to the F3 Brands' business line. With respect to any Leases
relating to the Blitz U.S.A., Inc. business, the Debtors are still
in the early stages of formulating a chapter 11 plan and therefore
are unable to determine which leases would be assumed or rejected
in connection with any reorganization of the Blitz USA business.
About Blitz USA
Blitz U.S.A. Inc., is a Miami, Oklahoma-based manufacturer of
plastic gasoline cans. The company, controlled by Kinderhook
Capital Fund II LP, filed for bankruptcy protection to stanch a
hemorrhage resulting from 36 product-liability lawsuits.
Parent Blitz Acquisition Holdings, Inc., and its affiliates filed
for Chapter 11 protection (Bankr. D. Del. Case Nos. 11-13602 thru
11-13607) on Nov. 9, 2011. The Hon. Peter J. Walsh presides over
the case.
Blitz USA disclosed $36,194,434 in assets and $41,428,577 in
liabilities in its schedules.
Daniel J. DeFranceschi, Esq., at Richards, Layton & Finger,
represents the Debtors in their restructuring efforts. The
Debtors tapped Zolfo Cooper, LLC, as restructuring advisor; and
Kurtzman Carson Consultants LLC serves as notice and claims agent.
Lowenstein Sandler PC from Roseland, New Jersey, represents the
Official Committee of Unsecured Creditors.
The Chapter 11 case is financed with a $5 million secured loan
from Bank of Oklahoma. Bank of Oklahoma, as DIP agent, is
represented by Samuel S. Ory, Esq., at Frederic Dorwart Lawyers in
Tulsa.
BLITZ USA: Wants Exclusive Periods Extended to June 6
-----------------------------------------------------
Blitz U.S.A. Inc. asks the U.S. Bankruptcy Court to extend the
period within which the Debtors have the exclusive right to file a
plan of reorganization for 90 days through and including June 6,
2012, and the period within which they have the exclusive right to
solicit acceptances of that plan through and including Aug. 6,
2012.
According to the Debtors, the first 120 days of the Chapter 11
Cases has been extremely busy and productive periods for the
Debtors during which they have devoted considerable attention to:
-- selling certain assets, including the assets relating to
the F3 Brands business line;
-- addressing the disruptions upon the Debtors' business caused
by the commencement of the Chapter 11 Cases, including issue
relating to customer concerns and employee attrition;
-- addressing the effect that the filing of the Chapter 11
Cases has upon the PCGC lawsuit pending against the Debtors
and certain of their resellers in various state and federal
courts; and
-- devising a long-term business strategy and meeting with key
constituencies to begin the process of formulating a
consensual chapter 11 plan of reorganization.
About Blitz USA
Blitz U.S.A. Inc., is a Miami, Oklahoma-based manufacturer of
plastic gasoline cans. The company, controlled by Kinderhook
Capital Fund II LP, filed for bankruptcy protection to stanch a
hemorrhage resulting from 36 product-liability lawsuits.
Parent Blitz Acquisition Holdings, Inc., and its affiliates filed
for Chapter 11 protection (Bankr. D. Del. Case Nos. 11-13602 thru
11-13607) on Nov. 9, 2011. The Hon. Peter J. Walsh presides over
the case.
Blitz USA disclosed $36,194,434 in assets and $41,428,577 in
liabilities in its schedules.
Daniel J. DeFranceschi, Esq., at Richards, Layton & Finger,
represents the Debtors in their restructuring efforts. The
Debtors tapped Zolfo Cooper, LLC, as restructuring advisor; and
Kurtzman Carson Consultants LLC serves as notice and claims agent.
Lowenstein Sandler PC from Roseland, New Jersey, represents the
Official Committee of Unsecured Creditors.
The Chapter 11 case is financed with a $5 million secured loan
from Bank of Oklahoma. Bank of Oklahoma, as DIP agent, is
represented by Samuel S. Ory, Esq., at Frederic Dorwart Lawyers in
Tulsa.
BLUE SPRINGS FORD: Jury Verdict Prompts Dealership's Ch. 11 Filing
------------------------------------------------------------------
Blue Springs Ford Sales, Inc., filed a Chapter 11 petition (Bankr.
D. Del. Case No. 12-10982) on March 21, 2012.
Blue Springs has been in the business of selling and servicing new
and used Ford vehicles since 1978. The Debtor also provides
vehicle repair and maintenance services, sells parts for Ford
vehicles for retail and wholesale, and operates a body shop. The
Debtor employs 124 people and has a monthly payroll of $557,000.
The Debtor owes Ford Motor Credit Company $7.9 million on a
prepetition financing agreement, under which obligations are
secured by the Debtor's new and used vehicle inventory. In
addition, the Debtor has unsecured obligations of at least
$2.1 million.
Christopher A. Ward, Esq., at Polsinelli Shughart PC, in
Wilmington, Delaware, serves as bankruptcy counsel. Donlin Recano
is the claims and notice agent.
Robert C. Balderston, president of the Debtor, explains, "While
the economy has affected the Debtor's business, it still remains
operationally sound and for the fiscal year ended Dec. 31, 2011,
the Debtor reported net revenues of $60.8 million. The current
Chapter 11 Case is the direct result of the Debtor's involvement
in pending state court litigation where the Debtor is vigorously
defending itself."
Prior to the Petition Date, the Debtor was sued in Circuit Court
of Jackson County, Missouri, under a variety of legal claims,
including, but not limited to, the Debtor's alleged failure to
adequately disclose a full detailed vehicle history report in
connection with a sale of a used Ford. A jury found the Debtor
liable and assessed actual damages in the amount of $171,500 and
punitive damages in the amount of $1.75 million (54 times the
actual damages).
Given the amount of the jury verdict, the Debtor was unable to
post bond on appeal. The parties were unable to resolve the
dispute and tolling agreements on the execution of the judgment
expired.
Accordingly, the Debtor said it took the unfortunate, but
necessary step, of filing its voluntary petition to preserve the
value of its business and assets.
The Chapter 11 case will allow the appeal of the adverse judgment
to progress so that an unfortunate wrong can be righted by the
legal system, says Mr. Balderston.
Postpetition Financing
The Debtor has filed typical first day motions, which include a
proposal to access postpetition financing and cash collateral.
The wholesale line of credit available to the Debtor through FMCC
currently provides the debtor access to as much as $8 million in
revolving credit on terms and conditions that the Debtor could not
obtain from other sources. This credit facility permits the
Debtor to continually replenish its floor plan inventory,
following the sale of such inventory, through advances made to or
for the benefit of the Debtor.
For the Debtor to continue to operate, it is critical that it
maintains on a postpetition basis the floor plan financing
afforded to it by FMCC on substantially identical terms as
provided for under the Pre-Petition Financing Agreement in order
that the Debtor may continue to operate as an authorized Ford
dealer and ensure its ability to purchase and sell Ford vehicles.
Under the proposed DIP facility, the $8 million wholesale line of
credit will be made available to the Debtor postpetition. Any
amount not paid when due will bear interest of 15% per annum or
the maximum contract rate permitted under Missouri law.
Guarantors under the DIP loan are Mr. Balderston; Kristine A.
Balderston; Stadium Honda, Inc.; and Lee's Summit Suburu, Inc.
CAMBIUM LEARNING: Moody's Changes Outlook on 'B2' CFR to Negative
-----------------------------------------------------------------
Moody's Investors Service has changed the outlook of Cambium
Learning Group, Inc. to negative from stable due to rising
leverage as a result of persistent top line weakness within the
company's largest segment. The company's B2 corporate family
rating (CFR) and B2 Probability of Default Rating (PDR) along with
the B2 (LGD4-54%) ratings on the company's $175 million senior
secured notes due 2017 remain unchanged.
Moody's has taken the following actions:
Issuer: Cambium Learning Group, Inc.
Outlook Actions:
Outlook, Changed To Negative From Stable
Ratings Rationale
Cambium's B2 CFR reflects the company's small scale relative to
competitors in the industry, its negative revenue trajectory and
its high leverage of over 5x (Moody's Adjusted, including
capitalizing operating leases, recognizing pre-production costs as
expense and adding the pension shortfall to debt, which
cumulatively add approximately 1.2x to leverage.) Cambium competes
against much larger companies in a highly fragmented industry. In
addition, about half of the company's sales are reliant upon state
and local funding, which is perpetually under pressure due to
budget constraints.
These negatives are offset by the company's positive free cash
flow, its strong liquidity position and the favorable market for
education products, particularly those catering to at-risk
students. The ratings are also supported by the breadth of the
company's customer base, in which 87 of the largest 100 school
districts in the US are customers, and no single customer accounts
for more than 10% of sales.
Cambium operates in a growing niche segment of the education
services market. However, due to operational missteps Cambium's
Voyager business segment, its largest, experienced double-digit
order volume declines in both 2010 and 2011. Total company
adjusted revenues fell 11% in 2011. Moody's expects revenues to
decline in 2012 by a low to mid-single-digit percentage. Leverage
rose to 5.6x (Moody's adjusted) as the company was unable to cut
costs in line with the drop in sales. Moody's expects that
leverage will fall towards 5.0x by the end of 2013 as cost cutting
catches up with the lower sales level. Moody's anticipates that
Cambium will deploy its cash for M&A and potentially realize
stronger growth. However, acquired businesses are unlikely to
reduce leverage in the near term.
Moody's views Cambium as having good liquidity and estimates that
Cambium will continue to generate positive free cash flow despite
some seasonality in working capital. The company requires minimal
capital expenditures and has no debt maturities prior to 2017. As
of year-end 2011, Cambium had $63 million in cash and $18 million
available under its undrawn, asset backed revolver due 2015 which
is not rated by Moody's.
Moody's could stabilize Cambium's outlook if the company can
return to sales growth such that leverage is on track to fall
below 5x within 12-18 months. Moody's could lower Cambium's
ratings further if sales do not stabilize and EBITDA continues to
deteriorate or if free cash flow turns negative for a prolonged
period. Additionally, the ratings could face downward pressure if
the company's liquidity deteriorates.
The principal methodology used in rating Cambium Learning Group
was the Global Publishing Industry Methodology published in
December 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.
Headquartered in Dallas, Texas, Cambium Learning Group, Inc.
provides research-based education solutions for students in Pre- K
through 12th grade, including intervention curricula, educational
technologies and services primarily focused on at risk students
with special needs. The company reported net revenue in 2011 of
approximately $172 million.
CC LLC: Baymont Inn Files for Chapter 11 in Tampa
--------------------------------------------------
CC LLC, doing business as Baymont Inn Suites, Orlando, filed a
Chapter 11 petition (Bankr. M.D. Fla. Case No. 12-03886) on
March 16, 2012.
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the Baymont Inn & Suites in Orlando is a typical
bankruptcy resulting from the collapse of the condominium market
in Florida.
According to the report, the 295-room property was purchased in
2005 for conversion to a condominium. By the time the market
turned in 2008, only 115 units were sold. It continues operating
as a hotel, renting out the condominium units along with those
unsold, a court filing shows.
The secured lender Highland Properties of Gulfcoast Ltd. is owed
$13.3 million. The property is worth $3.7 million, according to a
court filing in Tampa, Florida. Trade creditors are owed
$4.5 million.
CENTRAL FEDERAL: Rights Offering Extended Until April 17
--------------------------------------------------------
Central Federal Corporation announced that, based on strong
indications of interest in the stock offering, the Board of
Directors has extended the rights offering and commenced the
public offering of the Company's common stock. The subscription
rights associated with the rights offering, which had been set to
expire at 5:00 p.m. EST on March 20, 2012, have been extended to
5:00 p.m. EST on April 17, 2012. All record holders of the
Company's common stock as of 5:00 p.m. EST on Feb. 8, 2012
received, at no charge, one subscription right for each share of
common stock held as of the record date. Each subscription right
entitles the holder of the right to purchase 6.0474 shares of
Company common stock at a subscription price of $1.00 per share.
Shares are also available to the public at $1.00 per share. In
addition, for each three shares purchased in the rights offering
or public offering, purchasers will receive, at no charge, one
warrant to purchase one additional share of stock at a purchase
price of $1.00 per share. The warrants will be exercisable for
three years.
Persons interested in purchasing stock in the offering may contact
our information agent, ParaCap Group, LLC at 866.719.5037.
Eloise L. Mackus, CEO, commented, "We are pleased with the level
of enthusiasm for our stock offering. Its success will enable us
to move immediately into a position of capital strength and allow
for growth and expansion."
About Central Federal
Fairlawn, Ohio-based Central Federal Corporation (Nasdaq: CFBK) is
the holding company for CFBank, a federally chartered savings
association formed in Ohio in 1892. CFBank has four full-service
banking offices in Fairlawn, Calcutta, Wellsville and Worthington,
Ohio.
Central Federal's balance sheet at Sept. 30, 2011, showed
$265.4 million in total assets, $254.0 million in total
liabilities, and stockholders' equity of $11.4 million.
Regulatory Matters
On May 25, 2011, Central Federal Corporation and CFBank each
consented to the issuance of an Order to Cease and Desist (the
Holding Company Order and the CFBank Order, respectively, and
collectively, the Orders) by the Office of Thrift Supervision
(OTS), the primary regulator of the Holding Company and CFBank at
the time the Orders were issued.
The Holding Company Order required it, among other things, to: (i)
submit by June 30, 2011, a capital plan to regulators that
establishes a minimum tangible capital ratio commensurate with the
Holding Company's consolidated risk profile, reduces the risk from
current debt levels and addresses the Holding Company's cash flow
needs; (ii) not pay cash dividends, redeem stock or make any other
capital distributions without prior regulatory approval; (iii) not
pay interest or principal on any debt or increase any Holding
Company debt or guarantee the debt of any entity without prior
regulatory approval; (iv) obtain prior regulatory approval for
changes in directors and senior executive officers; and (v) not
enter into any new contractual arrangement related to compensation
or benefits with any director or senior executive officer without
prior notification to regulators.
The CFBank Order required CFBank to have by Sept. 30, 2011, and
maintain thereafter, 8% Tier 1 (Core) Capital to adjusted total
assets and 12% Total Capital to risk weighted assets. CFBank will
not be considered well-capitalized as long as it is subject to
individual minimum capital requirements.
CFBank did not comply with the higher capital ratio requirements
by the Sept. 30, 2011 required date.
CONTRACT RESEARCH: Files for Chapter 11 With Plans to Sell
-----------------------------------------------------------
Contract Research Solutions Inc., doing business as Cetero, a
provider of early-phase clinical research services for
pharmaceutical and biotechnology firms, filed a Chapter 11
petition March 26 in Delaware (Banrk. D. Del. Case No. 12-11004).
Cetero plans to sell the business to first-lien secured lenders in
exchange for $50 million in debt, absent higher and better offers.
First-lien lenders have offered to exchange $50 million in secured
debt and assume $30 million in liabilities to buy the assets.
First lien lenders are also providing a $15 million loan to
finance the Chapter 11 effort.
According to Bloomberg News, the deal with first-lien lenders
requires approval of bidding procedures by April 12 and an auction
between April 30 and May 5. The hearing for approval of the sale
must take place by May 10.
Cetero said in a court filing that the liquidity squeeze and
ensuing default declared by lenders resulted from the discovery
that some data recorded by company employees may have been
inaccurate. Eight months ago, the U.S. Food and Drug
Administration issued a report questioning the validity of data
provided by Cetero to clients. The FDA ordered re-testing after
finding hundreds of examples of faked research work over a 5-year
period at Cetero's Houston lab. The result was a liquidity
squeeze and a default declared by senior lenders.
Assets are $205 million, with debt total $248 million. There is
$185 million in debt for borrowed money, including $116 million on
a first-lien term loan and revolving credit. The second-lien loan
is $25 million. Second-lien lenders agree to the sale.
COVENANT BANK & TRUST: Closed; Stearns Bank Assumes Deposits
------------------------------------------------------------
Covenant Bank & Trust of Rock Spring, Ga., was closed on Friday,
March 23, 2012, by the Georgia Department of Banking and Finance,
which appointed the Federal Deposit Insurance Corporation as
receiver. To protect the depositors, the FDIC entered into a
purchase and assumption agreement with Stearns Bank, National
Association, of St. Cloud, Minn., to assume all of the deposits of
Covenant Bank & Trust.
The two branches of Covenant Bank & Trust will reopen during their
normal business hours as branches of Stearns Bank, National
Association. Depositors of Covenant Bank & Trust will
automatically become depositors of Stearns Bank, National
Association. Deposits will continue to be insured by the FDIC, so
there is no need for customers to change their banking
relationship in order to retain their deposit insurance coverage
up to applicable limits. Customers of Covenant Bank & Trust
should continue to use their existing branch until they receive
notice from Stearns Bank, National Association, that it has
completed systems changes to allow other Stearns Bank, National
Association branches to process their accounts as well.
As of Dec. 31, 2011, Covenant Bank & Trust had approximately $95.7
million in total assets and $90.6 million in total deposits. In
addition to assuming all of the deposits of the failed bank,
Stearns Bank, National Association, agreed to purchase essentially
all of the assets.
The FDIC and Stearns Bank, National Association entered into a
loss-share transaction on $71.6 million of Covenant Bank & Trust's
assets. Stearns Bank, National Association, will share in the
losses on the asset pools covered under the loss-share agreement.
The loss-share transaction is projected to maximize returns on the
assets covered by keeping them in the private sector. The
transaction also is expected to minimize disruptions for loan
customers. For more information on loss share, please visit:
http://www.fdic.gov/bank/individual/failed/lossshare/index.html
Customers with questions about the transaction should call the
FDIC toll-free at 1-800-537-4048. Interested parties also can
visit the FDIC's Web site at
http://www.fdic.gov/bank/individual/failed/covenant.html
The FDIC estimates that the cost to the Deposit Insurance Fund
will be $31.5 million. Compared to other alternatives, Stearns
Bank, National Association's acquisition was the least costly
resolution for the FDIC's DIF. Covenant Bank & Trust is the
fourteenth FDIC-insured institution to fail in the nation this
year, and the fourth in Georgia. The last FDIC-insured
institution closed in the state was Global Commerce Bank,
Doraville, on March 2, 2012.
CRYSTALLEX INT'L: Gets $36-Mil. DIP Financing After Auction
-----------------------------------------------------------
Crystallex International Corporation has successfully concluded an
auction process to raise debtor-in-possession financing in
accordance with the procedures approved by Ernst & Young Inc.
pursuant to the initial order made by the Ontario Superior Court
of Justice under the Companies' Creditors Arrangement Act (Canada)
on Dec. 23, 2011. As a result, the Company has executed a
commitment letter provided by Tenor Special Situation Fund I, LLC,
pursuant to which the Lender has agreed, subject to certain
conditions including the execution of a senior secured credit
agreement, to provide US$36 million to the Company. The financing
evidenced by the Commitment Letter is also subject to approval of
the Court as well as approval of the U.S. Bankruptcy Court. A
hearing before the Court has been scheduled for April 5, 2012, to
approve the financing evidenced by the Commitment Letter.
About Crystallex
Crystallex International Corporation is a Canadian based mining
company, with a focus on acquiring, exploring, developing and
operating mining projects. Crystallex has successfully operated
an open pit mine in Uruguay and developed and operated three gold
mines in Venezuela. The Company's principal asset is its
international claim in relation to its investment in the Las
Cristinas gold project located in Bolivar State, Venezuela.
On Dec. 23, 2011, announced that it obtained an order from the
Ontario Superior Court of Justice (Commercial List) for protection
under the Companies' Creditors Arrangement Act (Canada) (CCAA).
Ernst & Young Inc. was appointed monitor under the order.
Crystallex has also commenced a proceeding under Chapter 15 of the
Bankruptcy Code in the U.S. Bankruptcy Court for the District of
Delaware in order to ensure that relevant CCAA orders are enforced
in the United States. The Bankruptcy Court has recognized
Crystallex's CCAA proceeding as well as the initial order and
subsequent stay extension of the Ontario Superior Court of
Justice.
The Company reported a net loss of US$33.7 million for the nine
months ended Sept. 30, 2011, compared with a net loss of
US$27.7 million for the same period in 2010.
The Company reported losses from continuing operations of
US$22.0 million and US$14.5 million for the nine months Sept. 30,
2011, and 2010, respectively.
Following the Government of Venezuela's unilateral cancellation of
the Las Cristinas Mine Operating Contract (the "MOC") on Feb. 3,
2011, the Company filed for arbitration before ICSID's Additional
Facility and commenced the process of handing the Las Cristinas
project back to the Government of Venezuela. The handover to the
Government of Venezuela was completed on April 5, 2011, upon
receipt of a certificate of delivery from the Corporacion
Venezolana de Guayana (the "CVG"). As a result, the Company has
determined that its operations in Venezuela should be accounted
for as a discontinued operation.
The Company reported losses from discontinued operations of
US$11.7 million and US$13.1 million for the nine months ended
Sept. 30, 2011, respectively.
The Company's balance sheet at Sept. 30, 2011, showed
US$19.8 million in total assets, US$115.17 million in total
liabilities and a stockholders' deficit of US$95.3 million.
CRYSTALLEX INT'L: To Default on Canadian Disclosure Filing Rules
----------------------------------------------------------------
Crystallex International Corporation said that, in light of its
financial circumstances, the Company will not be in a position to
prepare and file annual audited financial statements and other
annual disclosure documents, required by Canadian securities laws
in respect of the Company's financial year ended Dec. 31, 2011, by
March 30, 2012. Consequently, following March 30, 2012, the
Company will be in default of its continuous disclosure filing
requirements under Canadian securities laws.
The Company has commenced discussions with the Ontario Securities
Commission, its principal Canadian securities regulatory
authority, concerning its imminent continuous disclosure filing
default.
The Company expects to be in a position to provide greater clarity
on this matter within the next two weeks, including whether it
will be able to obtain sufficient funds to meet its continuous
disclosure obligations and if not the nature of ongoing disclosure
that will be provided by the Company.
About Crystallex
Crystallex International Corporation is a Canadian based mining
company, with a focus on acquiring, exploring, developing and
operating mining projects. Crystallex has successfully operated
an open pit mine in Uruguay and developed and operated three gold
mines in Venezuela. The Company's principal asset is its
international claim in relation to its investment in the Las
Cristinas gold project located in Bolivar State, Venezuela.
On Dec. 23, 2011, announced that it obtained an order from the
Ontario Superior Court of Justice (Commercial List) for protection
under the Companies' Creditors Arrangement Act (Canada) (CCAA).
Ernst & Young Inc. was appointed monitor under the order.
Crystallex has also commenced a proceeding under Chapter 15 of the
Bankruptcy Code in the U.S. Bankruptcy Court for the District of
Delaware in order to ensure that relevant CCAA orders are enforced
in the United States. The Bankruptcy Court has recognized
Crystallex's CCAA proceeding as well as the initial order and
subsequent stay extension of the Ontario Superior Court of
Justice.
The Company reported a net loss of US$33.7 million for the nine
months ended Sept. 30, 2011, compared with a net loss of
US$27.7 million for the same period in 2010.
The Company reported losses from continuing operations of
US$22.0 million and US$14.5 million for the nine months Sept. 30,
2011, and 2010, respectively.
Following the Government of Venezuela's unilateral cancellation of
the Las Cristinas Mine Operating Contract (the "MOC") on Feb. 3,
2011, the Company filed for arbitration before ICSID's Additional
Facility and commenced the process of handing the Las Cristinas
project back to the Government of Venezuela. The handover to the
Government of Venezuela was completed on April 5, 2011, upon
receipt of a certificate of delivery from the Corporacion
Venezolana de Guayana (the "CVG"). As a result, the Company has
determined that its operations in Venezuela should be accounted
for as a discontinued operation.
The Company reported losses from discontinued operations of
US$11.7 million and US$13.1 million for the nine months ended
Sept. 30, 2011, respectively.
The Company's balance sheet at Sept. 30, 2011, showed
US$19.8 million in total assets, US$115.17 million in total
liabilities and a stockholders' deficit of US$95.3 million.
DEX MEDIA EAST: Bank Debt Trades at 49% Off in Secondary Market
---------------------------------------------------------------
Participations in a syndicated loan under which Dex Media East LLC
is a borrower traded in the secondary market at 51.13 cents-on-
the-dollar during the week ended Friday, March 23, 2012, an
increase of 0.54 percentage points from the previous week
according to data compiled by Loan Pricing Corp. and reported in
The Wall Street Journal. The Company pays 250 basis points above
LIBOR to borrow under the facility. The bank loan matures on
Oct. 24, 2014. The loan is one of the biggest gainers and losers
among 192 widely quoted syndicated loans with five or more bids in
secondary trading for the week ended Friday.
About R.H. Donnelley & Dex Media East
Based in Cary, North Carolina, R.H. Donnelley Corp., fka The Dun &
Bradstreet Corp. (NYSE: RHD) -- http://www.rhdonnelley.com/--
publishes and distributes print and online directories in the U.S.
It offers print directory advertising products, such as yellow
pages and white pages directories. R.H. Donnelley Inc., Dex
Media, Inc., and Local Launch, Inc., are the company's only direct
wholly owned subsidiaries.
Dex Media East LLC is a publisher of the official yellow pages and
white pages directories for Qwest Communications International
Inc. in the states, where Qwest is the primary incumbent local
exchange carrier, such as Colorado, Iowa, Minnesota, Nebraska, New
Mexico, North Dakota and South Dakota.
R.H. Donnelley Corp. and 19 of its affiliates, including Dex Media
East LLC, Dex Media West LLC and Dex Media, Inc., filed for
Chapter 11 protection (Bank. D. Del. Case No. 09-11833 through 09-
11852) on May 28, 2009, after missing a $55 million interest
payment on its senior unsecured notes. James F. Conlan, Esq.,
Larry J. Nyhan, Esq., Jeffrey C. Steen, Esq., Jeffrey E. Bjork,
Esq., and Peter K. Booth, Esq., at Sidley Austin LLP, in Chicago,
represented the Debtors in their restructuring efforts. Edmon L.
Morton, Esq., and Robert S. Brady, Esq., at Young, Conaway,
Stargatt & Taylor LLP, in Wilmington, Delaware, served as the
Debtors' local counsel. The Debtors' financial advisor was
Deloitte Financial Advisory Services LLP while its investment
banker was Lazard Freres & Co. LLC. The Garden City Group, Inc.,
served as claims and noticing agent. The Official Committee of
Unsecured Creditors tapped Ropes & Gray LLP as its counsel, Cozen
O'Connor as Delaware bankruptcy co-counsel, J.H. Cohn LLP as its
financial advisor and forensic accountant, and The Blackstone
Group, LP, as its financial and restructuring advisor. The
Debtors emerged from Chapter 11 bankruptcy proceedings at the end
of January 2010.
DEX MEDIA WEST: Bank Debt Trades at 39% Off in Secondary Market
---------------------------------------------------------------
Participations in a syndicated loan under which Dex Media West LLC
is a borrower traded in the secondary market at 60.58 cents-on-
the-dollar during the week ended Friday, March 23, 2012, an
increase of 0.78 percentage points from the previous week
according to data compiled by Loan Pricing Corp. and reported in
The Wall Street Journal. The Company pays 450 basis points above
LIBOR to borrow under the facility. The bank loan matures on Oct.
24, 2014, and carries Standard & Poor's C rating. The loan is one
of the biggest gainers and losers among 192 widely quoted
syndicated loans with five or more bids in secondary trading for
the week ended Friday.
About R.H. Donnelley & Dex Media East
Based in Cary, North Carolina, R.H. Donnelley Corp., fka The Dun &
Bradstreet Corp. (NYSE: RHD) -- http://www.rhdonnelley.com/--
publishes and distributes print and online directories in the U.S.
It offers print directory advertising products, such as yellow
pages and white pages directories. R.H. Donnelley Inc., Dex
Media, Inc., and Local Launch, Inc., are the company's only direct
wholly owned subsidiaries.
Dex Media East LLC is a publisher of the official yellow pages and
white pages directories for Qwest Communications International
Inc. in the states, where Qwest is the primary incumbent local
exchange carrier, such as Colorado, Iowa, Minnesota, Nebraska, New
Mexico, North Dakota and South Dakota.
R.H. Donnelley Corp. and 19 of its affiliates, including Dex Media
East LLC, Dex Media West LLC and Dex Media, Inc., filed for
Chapter 11 protection (Bank. D. Del. Case No. 09-11833 through 09-
11852) on May 28, 2009, after missing a $55 million interest
payment on its senior unsecured notes. James F. Conlan, Esq.,
Larry J. Nyhan, Esq., Jeffrey C. Steen, Esq., Jeffrey E. Bjork,
Esq., and Peter K. Booth, Esq., at Sidley Austin LLP, in Chicago,
represented the Debtors in their restructuring efforts. Edmon L.
Morton, Esq., and Robert S. Brady, Esq., at Young, Conaway,
Stargatt & Taylor LLP, in Wilmington, Delaware, served as the
Debtors' local counsel. The Debtors' financial advisor was
Deloitte Financial Advisory Services LLP while its investment
banker was Lazard Freres & Co. LLC. The Garden City Group, Inc.,
served as claims and noticing agent. The Official Committee of
Unsecured Creditors tapped Ropes & Gray LLP as its counsel, Cozen
O'Connor as Delaware bankruptcy co-counsel, J.H. Cohn LLP as its
financial advisor and forensic accountant, and The Blackstone
Group, LP, as its financial and restructuring advisor. The
Debtors emerged from Chapter 11 bankruptcy proceedings at the end
of January 2010.
CURTIS GORDON: Court Dismisses Prisoner's Chapter 11 Case
---------------------------------------------------------
Bankruptcy Judge Alan C. Stout dismissed the Chapter 11 case of
Curtis Gordon, Jr., at the behest of the U.S. Trustee, which
pointed out that the Debtor is now incarcerated in prison in
Pennsylvania, serving a 39-month sentence for tax evasion. As
such, the Debtor will not be able to attend any of the required
hearings or meetings with the U.S. Trustee.
The Debtor admits he is currently incarcerated in federal prison
and requested that, in lieu of attending the required meetings and
hearings in person, he be allowed to appear via videoconference,
through a power of attorney, or possibly telephonically.
Curtis Gordon, Jr., filed for Chapter 11 bankruptcy (Bankr. W.D.
Ky. Case No. 12-30745) on Feb. 20, 2012. Curtis Gordon, Jr., in
Prospect, Kentucky, previously filed a Chapter 11 petition (Bankr.
W.D. Ky. Case No. 10-34581) on Aug. 27, 2010. Judge Thomas H.
Fulton presides over the case. Gordon A. Rowe, Jr., Esq., in
Louisville, served as the Debtor's counsel in the 2010 case. Mr.
Gordon listed $1 million to $10 million in both assets and debts
in the 2010 petition.
A copy of the Court's March 21, 2012 Supplemental Memorandum is
available at http://is.gd/DYIizPfrom Leagle.com.
DELTA PETROLEUM: Bid Deadline, Auction Date Moved to April
----------------------------------------------------------
Judge Kevin Carey granted the request of Delta Petroleum Corp. to
amend the bidding procedures for its upcoming auction. The
expanded procedures allow bidders to propose buying stock as part
of a plan of reorganization, as well as the asset bids currently
contemplated.
According to Bill Rochelle, the bankruptcy columnist for Bloomberg
News, in addition to altering the standard contract, the
bankruptcy judge rescheduled the auction process. Now, bids are
due April 18, followed by an April 24 auction and a hearing on May
1 for approval of the best bid.
Katy Stech, writing for Dow Jones' Daily Bankruptcy Review,
reports that Delta was able to convince the Court that the
amendments could protect the Company's more than $1.1 billion
worth of tax benefits for its buyer. According to Dow Jones,
Delta said that its valuable tax benefits could eventually be used
to free "cash flow for debt service, working capital, capital
expenditures and other beneficial uses," according to earlier
court documents.
Delta was initially slated to hold an auction on March 26. No
buyer is under contract.
About Delta Petroleum
Delta Petroleum Corporation (NASDAQ: DPTR) is an independent oil
and gas company engaged primarily in the exploration for, and the
acquisition, development, production, and sale of, natural gas and
crude oil. Natural gas comprises over 90% of Delta's production
services. The core area of its operations is the Rocky Mountain
Region of the United States, where the majority of the proved
reserves, production and long-term growth prospects are located.
Delta and seven of its subsidiaries sought Chapter 11 bankruptcy
protection (Bankr. D. Del. Case Nos. 11-14006 to 11-14013,
inclusive) on Dec. 16, 2011, roughly six weeks before the Jan. 31,
2012 scheduled maturity of its $38.5 million secured credit
facility with Macquarie Bank Limited and after several months of
unsuccessful attempts to sell the business. Delta disclosed
$375,498,248 in assets and $310,679,157 in liabilities, which also
include $152,187,500 in outstanding obligations on account of the
7% senior unsecured notes issued in March 2005 with US Bank
National Association indenture trustee; and $115,527,083 in
outstanding obligations on account of 3-3/4% Senior Convertible
Notes due 2037 issued in April 2007. In its amended schedules,
the Delta Petroleum disclosed $373,836,358 in assets and
$312,864,788 in liabilities.
W. Peter Beardsley, Esq., Christopher Gartman, Esq., Kathryn A.
Coleman, Esq., and Ashley J. Laurie, Esq., at Hughes Hubbard &
Reed LLP, in New York, N.Y., represent the Debtors as counsel.
Derek C. Abbott, Esq., Ann C. Cordo, Esq., and Chad A. Fights,
Esq., at Morris, Nichols, Arsht & Tunnel LLP, in Wilmington, Del.,
represent the Debtors as co-counsel. Conway Mackenzie is the
Debtors's restructuring advisor. Evercore Group L.L.C. is the
financial advisor and investment banker. The Debtors selected
Epiq Bankruptcy Solutions, LLC as claims and noticing agent. The
petition was signed by Carl E. Lakey, chief executive officer and
president.
The U.S. Trustee told the bankruptcy judge that there was
insufficient interest from creditors to form an official committee
of unsecured creditors.
DEX ONE: Has Tender Offer for Outstanding 12%/14% Senior Notes
--------------------------------------------------------------
Dex One Corporation announced the commencement of a cash tender
offer to purchase the maximum aggregate principal amount of its
outstanding 12% / 14% Senior Subordinated Notes due 2017 that it
can purchase for $26.0 million, excluding cash in lieu of accrued
interest on the Notes accepted for purchase calculated from
March 31, 2012, through but not including the payment date at a
rate of 12% per annum.
The tender offer is being made pursuant to an Offer to Purchase
and a related Letter of Transmittal, each dated as of March 20,
2012. The tender offer will expire at 9:00 a.m., New York City
time, on April 19, 2012. Notes validly tendered may be validly
withdrawn at or prior to 9:00 a.m., New York City time, on
April 19, 2012.
As of March 20, 2012, the outstanding aggregate principal amount
of the Notes is $300.0 million. On April 2, 2012, the next
interest payment date for the Notes, the outstanding aggregate
principal amount of the Notes is expected to increase to $310.5
million as a result of Dex One electing its option to pay 50% of
the interest payment due on the Interest Payment Date in the form
of additional Notes, in accordance with the terms of the related
indenture.
The "total consideration" for Notes validly tendered and not
validly withdrawn on or prior to the Expiration Date and accepted
by Dex One for purchase will be calculated per $1,000 principal
amount of Notes validly tendered, and not validly withdrawn, on or
prior to the Expiration Date and accepted for purchase by Dex One
pursuant to a modified "Dutch Auction," as described in the Offer
to Purchase. The purchase price range for Notes accepted for
purchase, as described in the Offer to Purchase, will be $270 to
$300 per $1,000 principal amount of such Notes plus an amount in
cash in lieu of the accrued and unpaid interest on those Notes,
calculated at a rate of 12% per annum on the aggregate principal
amount of such Notes from March 31, 2012, to, but not including,
the payment date. Dex One expects the payment date to be not
later than the third New York Stock Exchange trading day following
the Expiration Date.
About Dex One
Dex One, headquartered in Cary, North Carolina, is a local
business marketing services company that includes print
directories and online voice and mobile search. Revenue was
approximately $1.1 billion for the LTM period ended Sept. 30,
2010.
R.H. Donnelley Corp. and 19 of its affiliates, including Dex
Media East LLC, Dex Media West LLC and Dex Media Inc., filed for
Chapter 11 protection on May 28, 2009 (Bank. D. Del. Case No. 09-
11833 through 09-11852). They emerged from bankruptcy on Jan. 29,
2010. On the Effective Date and in connection with its emergence
from Chapter 11, RHD was renamed Dex One Corporation.
Dex One reported a net loss of $518.96 million in 2011 compared
with a net loss of $923.59 million for the eleven months ended
Dec. 31, 2010.
The Company's balance sheet at Dec. 31, 2011, showed $3.46 billion
in total assets, $3.47 billion in total liabilities, and a
$9.86 million total shareholders' deficit.
DIPPIN' DIPS: Settles Dispute with Regions; $1.2MM Loan Okayed
--------------------------------------------------------------
The Bankruptcy Court approved a stipulation and agreed order
entered into between Dippin' Dots, Inc., and Regions Bank.
On Feb. 24, 2012, Regions Bank filed a motion to appoint a Chapter
11 trustee, which the Debtor opposed. On Feb. 27, 2012, the
Debtor filed a motion for authority to obtain DIP financing, which
Regions opposed.
Pursuant to the Agreement, the Debtor withdrew its request to
obtain DIP, and Regions withdrew its motion to appoint Chapter 11
Trustee.
For so long as the Debtor is not in default under the Stipulation,
the Debtor will have the right to continue to use cash collateral.
Pursuant to the Stipulation, the Debtor is authorized to borrow up
to $1.2 million from Regions for the purpose of working capital
pending the conclusion of the sales process.
As part of the Stipulation, Curt Jones irrevocably resigns as
member of the board of directors, officer and employee of the
Debtor. Mr. Jones' resignation is effective notwithstanding any
provision in any bylaws, shareholder agreement, or other similar
organizational document of the Debtor requiring the consent or
vote of shareholders. All authority and responsibilities
previously vested in Mr. Jones will be vested in the Chief
Restructuring Officer. The board of directors of the Debtor will
remain vacant during the pendency of the Bankruptcy Case, and the
CRO will exercise his duties and responsibilities without regard
to board makeup.
The Debtor is directed to appoint Greg Charleston of Conway
MacKenzie Management Services, LLC, to serve as CRO.
About Dippin' Dots
Founded in 1988 by microbiologist Curt Jones, Dippin' Dots Inc.
manufactures quirky and colorful ice cream beads, which are flash
frozen using liquid nitrogen. It owns a 120,000-square-foot plant
in Kentucky that can produce more than 25,000 gallons of frozen
dots a day. It has about 140 Dippin' Dots retail locations, which
are mostly controlled by franchisees, and agreements with 9,952
small vendors who sell the ice cream at fairs, festivals and
sports games. Dippin' Dots isn't sold in grocery stores because
of its extreme cooling requirements.
Dippin' Dots filed a Chapter 11 petition (Bankr. W. D. Ky Case No.
11-51077) on Nov. 3, 2011 in Paducah, Kentucky. Judge Thomas H.
Fulton presides over the case. Farmer & Wright, PLLC, represents
the Debtor as Chapter 11 counsel. The Debtor disclosed
$20,233,130 in assets and up to $20,233,130 in debts. The
petition was signed by Curt Jones, president.
Regions Bank, the Debtor's secured lender, is represented by Brian
H. Meldrum, Esq., at Stites & Harbison PLLC.
DRI CORP: Bus-Sign Maker Files Bankruptcy to Sell Business
----------------------------------------------------------
DRI Corp. (OTCQB:TBUS), a provider of digital signs for
transportation systems, filed a Chapter 11 petition in Wilson,
North Carolina (Bankr. E.D.N.C. Case No. 12-02298) on March 25.
DRI intends to sell its assets and operations under Section 363 of
Chapter 11 of the U.S. Bankruptcy Code.
The board retained in April last year Morgan Keegan & Company,
Inc. to consider and evaluate the Company's strategic
alternatives.
David L. Turney, the Company's Chairman of the Board of Directors
and Chief Executive Officer said, "Our decision to sell DRI
through the 363 process is being undertaken to ensure that we
preserve value; absent this action, the company would be unable to
continue at least the US operations and fulfill duties to US
lenders. Therefore, after careful consideration of the Company's
present financial constraints stemming from, at least in
substantial part from the ongoing global economic recession, we
believe this action to be necessary as we strive to preserve the
maximum value of our enterprise. Our current understanding of the
Company's enterprise value based upon the proposal submitted by
our potential buyer, is that no amounts will be returned to any
common or preferred shareholder.
Mr. Turney further stated, "It is our intent to continue serving
our customers uninterrupted right through the 363 process; we have
post petition financing in place and there is a pending offer from
a potential buyer to acquire the assets of the Company."
Mr. Turney continued, "The bankruptcy filing is only related to
the US-based organizations. The international business of DRI,
under DRI Europa AB, or more directly the Mobitec group of DRI
subsidiaries, collectively represents about 65% of the total DRI
Corporation revenue. Since the capital stock of DRI Europa AB is
held by DRI, ultimately the entire Company's ownership will
change, although the international Mobitec business should not be
affected by the bankruptcy filing."
In closing, Mr. Turney commented, "We also plan to seek the
approval of the Securities and Exchange Commission to suspend
reporting (including but not limited to reporting on forms 10K and
10Q, for example) and conducting the FY 2011 annual Audit, while
we are in the 363 process. However, management does expect to
file an 8K in the near future providing additional details
regarding this matter."
Dallas-based DRI disclosed assets of $42.8 million and liabilities
totaling $31.4 million. Debt includes $9.6 million owing to
Interim Funding III LP, a secured lender with liens on all assets.
DRI CORP: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------
Debtor: DRI Corporation
13760 Noel Road, Suite 830
Dallas, TX
Bankruptcy Case No.: 12-02298
Debtor-affiliates that filed separate Chapter 11 petitions:
Debtor Case No.
------ --------
Digital Recorders, Inc. 12-02299
TwinVision of North America, Inc. 12-02300
Robinson Turney International, Inc. 12-02302
Type of Business: DRI Corporation, together with its subsidiaries,
engages in the design, manufacture, sale, and
servicing of information technology products.
Web site: http://www.digrec.com/
Chapter 11 Petition Date: March 25, 2012
Court: U.S. Bankruptcy Court
District of
Judge: Hon. Randy D. Doub
Debtors'
Counsel: John A. Northern, Esq.
Vicki L. Parrott, Esq.
NORTHEN BLUE, LLP
PO Box 2208
Chapel Hill, NC 27515-2208
Tel: (919) 968-4441
Fax: (919) 942-6603
E-mail: jan@nbfirm.com
vlp@nbfirm.com
Debtors'
Chief
Restructuring
Officer and
Financial
Consultant: THE FINLEY GROUP, INC.
Debtors'
Investment
Banker: MORGAN KEEGAN & COMPANY, INC.
Total Assets: $42,816,000 as of Sept. 30, 2011
Total Debts: $31,428,000 as of Sept. 30, 2011
The petition was signed by David L. Turney, chairman and CEO.
DRI Corporation's List of Its 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Gray Layton Kersh Solomon $315,985
Furr Smith PA
516 South New Hope Road
Gastonia, NC 28053-2636
BKD LLP $121,849
Andrews Kurth LLP $108,679
Property Reserve Inc $87,147
Wyrick Robbins Yates & $57,717
Ponton LLP
Grant Thornton LLP $48,815
Exact Software North America $23,036
LLC
CBIZ Valuation Group, LLC $21,577
RR Donnelley Financial Inc $13,524
Business Wire $8,537
American Airlines $7,890
AST American Stock Transfer $7,552
& Trust Co.
De Lage Landen $7,107
TW Telecom $5,636
Cassell Design Group, Inc $4,258
Howison & Arnott LLP $4,811
Merrill Communications LLC $4,279
Precisionir Inc $4,800
Shareholder.Com $4,470
Solium Capital (Formerly $3,792
Allecon)
EL CENTRO MOTORS: Ford-Lincoln Dealer Files Ch. 11 in San Diego
---------------------------------------------------------------
El Centro Motors, operator of a Ford-Lincoln automobile dealership
in El Centro, California, filed a Chapter 11 petition (Bankr. S.D.
Calif. Case No. 12-03860) on March 21, 2012.
A meeting of creditors under 11 U.S.C. Sec. 341(a) is scheduled
for April 17, 2012 at 2:00 p.m. at 402 W. Broadway, Emerald Plaza
Building, Suite 660(B), Hearing Room B, San Diego, California.
Krifor Meshefajian, Esq., at Levene, Neale, Bender, Yon &
Brill LLP, serves as counsel.
The prior owner of the dealership operated the business since
1932. The business is presently owned by Dennis Nesselhauf and
Robert Valdes.
The dealership, which has 80 employees, claims to be among the
largest employers in El Centro. It says it has consistently
received some of the highest Consumer Satisfaction Index ratings
and has consistently maintained an excellent working relationship
with Ford and Lincoln.
The Debtor claims that its assets, which include the property
constituting the dealership in El Centro, and new and used
vehicles, have a value of $14 million. The Debtor owes Ford Motor
Credit Company $4.3 million on a term-loan secured by a first
priority deed of trust against the El Centro property, 380,000 on
a revolving credit line, and $6 million on a flooring line of
credit used to purchase vehicle inventory. The Debtor also owes
$1.03 million to Community Valley Bank, which loan is secured by a
second priority deed of trust against the property. In addition
to $3.95 million arbitration award owed to Dealer Computer
Systems, Inc., the Debtor owes $3 million in unsecured debt.
According to a court filing, the dealership generally operated at
a profit, until it suffered the same economic setbacks suffered by
dealerships across the country. In 2007, the Debtor suffered an
$806,000 loss; in 2008, it had a $4.5 million loss, and in 2009,
it suffered a $957,000 loss.
In addition, Dealer Computer Services, which provided the dealer
management system, obtained in November 2001, an arbitration award
in the amount of $3.95 million, following a breach of contract
lawsuit it filed against the Debtor. DCS has commenced collection
efforts attempting to levy the Debtor's bank accounts and place
liens on its assets.
Accordingly, the Debtor filed for bankruptcy to preserve and
maximize the Debtor's estate for the benefit of the Debtor's
creditors, to provide the Debtor a reprieve from highly disruptive
and financially detrimental collection efforts, and to provide the
Debtor an opportunity to reorganize its financial affairs in as
efficient a manner as possible.
The Debtor has filed emergency first day motions that include
proposals to use cash collateral, pay prepetition wages, and honor
deposits owed to five customers.
The Debtor says it has no ability to continue to operate its
business and maintain the going concern value unless the Debtor
has immediate access to, and use of, cash collateral to pay the
Debtor's ordinary operating expenses, including, but not limited
to, payroll, rent, utilities, etc.
EMISPHERE TECHNOLOGIES: Has $8.14-Mil. Operating Loss in 2011
-------------------------------------------------------------
Emisphere Technologies, Inc., filed with the U.S. Securities and
Exchange Commission its annual report on Form 10-K disclosing an
operating loss of $8.14 million on $0 of revenue for the year
ended Dec. 31, 2011, compared with an operating loss of $11.54
million on $100,000 of revenue during the prior year.
The Company generated net income of $15.05 million in 2011,
following a net loss of $56.91 million in 2010.
A $28.7 million change in fair value of derivative instruments
allowed the Company to record a profit in its balance sheet.
The Company's balance sheet at Dec. 31, 2011, showed $4.22 million
in total assets, $68.74 million in total liabilities, and a
$64.52 million total stockholders' deficit.
As of Dec. 31, 2011, the accumulated deficit has reached $465.9
million.
A copy of the Form 10-K is available for free at:
http://is.gd/7la6bj
Going Concern
While the Company's plan is to raise capital when needed or to
pursue partnering opportunities, it cannot be sure that its plans
will be successful.
Consequently, the audit reports prepared by the Company's
independent registered public accounting firm relating to its
financial statements for the years ended Dec. 31, 2011, 2010 and
2009 include an explanatory paragraph expressing the substantial
doubt about the Company's ability to continue as a going concern.
Bankruptcy Warning
The Company, according to the Dec. 31, 2011 Form 10-K, is pursuing
new as well as enhanced collaborations and exploring other
financing options, with the objective of minimizing dilution and
disruption. If the Company fails to raise additional capital or
obtain substantial cash inflows from existing partners prior to
Sept. 26, 2012, the Company could be forced to cease operations.
About Emisphere Technologies
Based in Cedar Knolls, New Jersey, Emisphere Technologies, Inc.
(OTC BB: EMIS) -- http://www.emisphere.com/-- is a
biopharmaceutical company that focuses on a unique and improved
delivery of pharmaceutical compounds and nutritional supplements
using its Eligen(R) Technology. The Eligen(R) Technology can be
applied to the oral route of administration as well other delivery
pathways, such as buccal, rectal, inhalation, intra-vaginal or
transdermal.
Since its inception in 1986, Emisphere has generated significant
losses from operations. Emisphere anticipates it will continue to
generate significant losses from operations for the foreseeable
future, and that its business will require substantial additional
investment that it has not yet secured.
EMPIRE RESORTS: Ernst & Young Replaces Friedman as Accountant
-------------------------------------------------------------
The Audit Committee of the Board of Directors of Empire Resorts,
Inc., dismissed the Company's independent registered public
accountant, Friedman LLP.
In connection with the audits of the fiscal years ended Dec. 31,
2011, and 2010, no disagreements exist with Friedman LLP on any
matter of accounting principles or practices, financial statement
disclosure, or auditing scope or procedure, which disagreements if
not resolved to the satisfaction of Friedman LLP would have caused
them to make reference in connection with their report to the
subject of the disagreements.
Friedman LLP's report on the financial statements of the Company
for the year ended Dec. 31, 2011, did not contain an adverse
opinion or a disclaimer of opinion, nor was it qualified or
modified as to uncertainty, audit scope, or accounting principles.
On March 20, 2012, the Company's Board of Directors approved the
appointment of Ernst & Young as the Company's independent
registered public accountant. The decision to engage Ernst &
Young was approved by the Audit Committee. Prior to March 20,
2012, the Company did not consult with Ernst & Young regarding:
(1) the application of accounting principles to a specified
transaction;
(2) the type of audit opinion that might be rendered on the
Company's financial statements;
(3) written or oral advice provided that would be an important
factor considered by the Company in reaching a decision as
to an accounting, auditing or financial reporting issue; or
(4) any matter that was the subject of a disagreement between
the Company and its predecessor auditor as described in
Item 304(a)(1)(iv) or a reportable event as described in
Item 304(a)(1)(v) of Regulation S-K.
About Empire Resorts
Based in Monticello, New York, Empire Resorts, Inc. (NASDAQ: NYNY)
-- http://www.empireresorts.com/-- owns and operates Monticello
Casino & Raceway, a video gaming machine and harness racing track
and casino located in Monticello, New York, 90 miles northwest of
New York City.
Friedman LLP, after auditing the Company's financial statements
for the year ended Dec. 31, 2010, expressed substantial doubt
about the Company's ability to continue as a going concern.
Friedman noted that the Company's ability to continue as a going
concern depends on its ability to satisfy its indebtedness when
due. In addition, the Company has continuing net losses and
negative cash flows from operating activities.
Empire Resorts reported a net loss of $17.57 million on
$68.54 million of net revenues for the year ended Dec. 31, 2010,
compared with a net loss of $10.57 million on $67.63 million of
net revenues during the prior year. The Company reported net
income of $958,000 on $53.53 million of net revenues for the nine
months ended Sept. 30, 2011.
The Company's balance sheet at Sept. 30, 2011, showed
$50.53 million in total assets, $24.86 million in total
liabilities, and $25.66 million in total stockholders' equity.
EMPRESAS INTEREX: Court OKs Carrasquillo as Financial Consultant
----------------------------------------------------------------
Empresas Interex Inc. sought and obtained permission from the U.S.
Bankruptcy Court to employ CPA Luis R. Carrasquillo & Co., P.S.C.
as financial consultant. The Debtor said it needs a financial
Cons1ultant to assist management in the financial restructuring of
its affairs by providing advice in strategic planning and the
preparation of the Debtor's plan of reorganization, disclosure
statement and business plan, and participating in the Debtor's
negotiations with creditors.
The Debtor has paid Carrasquillo $12,000 in advance.
With the exception that Carrasquillo has acted as financial
consultant in other bankruptcy cases in which Charles A. Curpill,
Esq., the Debtor's counsel, has or is representing debtors, the
firm has no other prior connections with Debtor, its officers,
directors, and insiders, any creditor, or other party in interest,
their respective attorneys and accountants, the U.S. trustee or
any person employed in the office of the U.S.
The firm's rates are:
Professional Rates
------------ -----
Partner $160
Senior CPA $125
Other CPA's $90-$125
Senior Accountant $75- $85
Junior Accountant $50
Administrative support $35
San Juan, Puerto Rico-based Empresas Interex Inc. filed for
Chapter 11 bankruptcy (Bankr. D. P.R. Case No. 11-10475) on
Dec. 7, 2011. Bankruptcy Judge Mildred Caban Flores presides
Over the case. The company posts $11,412,500 in assets and
$9,335,561 in liabilities.
EMPRESAS INTEREX: Court OKs Cuprill Law Office as Bankr. Counsel
----------------------------------------------------------------
Empresas Interex Inc. sought and obtained permission to employ the
Charles A. Curpill, PSC Law Office as bankruptcy counsel.
The Debtor will pay Charles A. Cuprill-Hernandez, Esq., US$350 per
hour; senior associates US$225; junior associates US$150; and
paralegals US$85. The Debtor will also reimburse the firm for
actual necessary expenses. The Debtor has provided the firm with
US$15,000 as retainer.
Mr. Cuprill-Hernandez attests that his firm is a "disinterested
person" as defined in 11 U.S.C. Sec. 101(14).
San Juan, Puerto Rico-based Empresas Interex Inc. filed for
Chapter 11 bankruptcy (Bankr. D. P.R. Case No. 11-10475) on
Dec. 7, 2011. Bankruptcy Judge Mildred Caban Flores presides
Over the case. The company posts $11,412,500 in assets and
$9,335,561 in liabilities.
FGIC CORP: Plan Confirmation Hearing Set for April 19
-----------------------------------------------------
The Hon. Stuart M. Bernstein of the U.S. Bankruptcy Court for the
Southern District of New York has approved FGIC Corporation's
disclosure statement, and has set April 19, 2012, as the
confirmation hearing date of the Debtor's Plan of Reorganization.
As reported by the Troubled Company Reporter on Feb. 9, 2012, the
Debtor filed the Plan and corresponding Disclosure Statement dated
Feb. 3, 2012, which proposes to fund distributions to Holders of
Allowed Claims in Classes 1 to 6 with its existing Cash on hand
plus the Contribution Amount less certain other amounts necessary
to fund the Reorganized Debtor's anticipated reasonable operating
expenses after the Effective Date. Under the Plan, Holders of
Allowed General Unsecured Claims in Class 6 will also receive
common stock in the Reorganized Debtor. The Debtor estimates that
the Cash distributions to Holders of Allowed Class 6 Claims will
represent a value between 5.5% and 6% of the face value of those
Claims. Pursuant to the Plan, the Debtor will also cancel debt
obligations in the aggregate amount of approximately
$391.5 million.
Copies of the Plan, Disclosure Statement and Tax Allocation
Agreement are available for free at:
http://bankrupt.com/misc/FGICCorp_PlanDSFeb3.pdf
The Court ruled that the Debtor is authorized to make non-material
amendments to the Disclosure Statement, the Plan and related
documents (including the appendices thereto and exhibits to this
Solicitation Procedures Order) before distributing solicitation
packages to each creditor or other party in interest in accordance
with the terms of the solicitation procedures order without
further order of the Court, including amendments to correct
typographical, clerical and grammatical errors, and to make
conforming amendments among the Disclosure Statement, the Plan and
related documents.
The Debtor is authorized to employ and retain The Garden City
Group, Inc., as voting and solicitation agent.
For votes to be counted, holders of claims entitled to vote on the
Plan must properly complete, execute and return their Ballots by
(a) first class mail, (b) overnight courier or (c) hand delivery
so that they are actually received by the Voting and Solicitation
Agent on or before 4:00 p.m. prevailing Eastern Time on April 12,
2012.
About FGIC Corp.
New York-based FGIC Corporation is a privately held insurance
holding company. FGIC Corp's main business interest lies in the
holdings of the bond insurer Financial Guaranty Insurance Company
-- http://www.fgic.com/-- and it depends on dividend payments by
FGIC for sustaining its operations. FGIC had stopped paying
dividends to parent FGIC Corp. since January 2008.
FGIC Corp. filed for Chapter 11 bankruptcy protection (Bankr.
S.D.N.Y. Case No. 10-14215) on Aug. 3, 2010. The bond insurer
subsidiary did not file for bankruptcy.
Paul M. Basta, Esq., Brian S. Lennon, Esq., at Kirkland & Ellis
LLP, in New York, serves as counsel to the Debtor. Garden City
Group, Inc., is the Debtor's claims and noticing agent. The
Official Committee of Unsecured Creditors tapped David Capucilli,
Esq., at Morrison & Foerster LLP, in New York as its counsel. The
Debtor disclosed $11,539,834 in assets and $391,555,568 in
liabilities as of the Petition Date.
FULLER BRUSH: Hires Foulston as Intellectual Property Lawyer
------------------------------------------------------------
The Fuller Brush Company, Inc., and CPAC, Inc., seek Bankruptcy
Court authority to employ Foulston Siefkin LLP as special
intellectual property counsel.
Since March 2005, Foulston has represented Fuller Brush with
respect to Fuller Brush's intellectual property and trademarks
matters. Foulston is owed $16,598 for fees and expenses billed
before the Petition Date and approximately $500 of unbilled time
on account of prepetition services rendered to Fuller Brush that
remains unpaid. Additionally Foulston received $4,448 on Dec. 20,
2011, within 90 days of the Petition Date.
Foulston's tasks include prosecution and maintenance of
applications and registrations for trademarks before the U.S.
Patent and Trademark Office.
The current hourly rates of lawyers that will work on the Debtors'
matters are $295 for William Matthews, Esq., and $220 for Alicia
Bodecker, Esq.
William P. Matthews, Esq. -- bmatthews@foulston.com -- attests
that Foulston does not represent or hold any interest adverse to
the Debtors or their estates with respect to the matters as to
which Foulston is to be employed.
About The Fuller Brush Company
The Fuller Brush Company -- http://www.fuller.com/-- sells
branded and private label products for personal care, commercial
and household cleaning and has a current catalog of 2,000 cleaning
products. Some of Fuller's retail partners include Home Trends,
Bi-Mart, Byerly's, Lunds, Home Depot, Do-It-Best, Primetime
Solutions, Vermont Country Store and Starcrest.
Founded in 1906 and based in Great Bend, Kansas, The Fuller Brush
Company, Inc., and its parent, CPAC, Inc., filed for Chapter 11
protection (Bankr. S.D.N.Y. Case Nos. 12-10714 and 12-10715) in
Manhattan on Feb. 21, 2012. Fuller Brush filed for bankruptcy
five years after the company was taken over by private equity firm
Buckingham Capital Partners.
Fuller said it will be business as usual while undergoing Chapter
11 restructuring. But it said that while in reorganization, it
intends to trim about half of the current catalog of cleaning
products.
Herrick Feinstein LP is the bankruptcy counsel.
Fuller, which has 180 employees as of the Chapter 11 filing,
disclosed $22.9 million in assets and $50.9 million in debt.
An affiliate of the landlord, Victory Park Capital Advisors LLC,
is now the secured lender owed more than $22 million. An
affiliate of Chicago-based Victory Park has agreed to provide
$5 million in secured financing for the Chapter 11 effort. The new
loan will come ahead of existing liens.
An official committee of unsecured creditors has been appointed in
the case. The Committee selected Kelley Drye & Warren LLP as its
proposed counsel.
GELT PROPERTIES: Can Access Cash Collateral Until March 31
----------------------------------------------------------
The Bankruptcy Court authorized Gelt Properties, LLC, et al., to
use cash collateral through March 31, 2012.
As adequate protection for the use of cash collateral on an
interim basis, the lenders are granted valid, binding, enforceable
and perfected replacement security interests in and replacement
liens on all now owned or hereafter acquired property and assets
of the Debtors.
As reported by the TCR on Feb. 20, 2012, the Debtors owe to
prepetition lenders $4,545,344, secured by collateral assignment
of mortgages and rents and leases.
The hearing on the continued use Cash Collateral has been
scheduled for April 24, 2012, at 11:00 a.m.
About Gelt Properties
Based in Huntington Valley, Pennsylvania, Gelt Properties, LLC,
and affiliate Gelt Financial Corporation borrow money from
traditional lenders and make loans to commercial borrowers. They
also acquire and manage real estate. Gelt Properties and Gelt
Financial filed for (Bankr. E.D. Pa. Case Nos. 11-15826 and 11-
15826) on July 25, 2011. Judge Magdeline D. Coleman presides over
the cases. Albert A. Ciardi, III, Esq., Jennifer E. Cranston,
Esq., and Thomas Daniel Bielli, Esq., at Ciardi Ciardi & Astin,
P.C., in Philadelphia, Pa., serve as the Debtors' bankruptcy
counsel. The petitions were signed by Uri Shoham, the Debtors'
chief financial officer. The Debtors' other professionals
include: Eisenberg, Gold & Cettei P.C. as its special counsel to
provide proper legal counsel to the Debtors with regard to
defending against certain actions, Cohen and Forman as their
special counsel to advise them upon all matters which may arise or
which may be incident to the bankruptcy proceedings.
Gelt Properties disclosed $4.73 million in assets and
$4.84 million in liabilities as of the Chapter 11 filing. Its
affiliate, Gelt Financial has scheduled $20.3 million in assets
and $17.05 million in liabilities as of the Chapter 11 filing.
On Sept. 15, 2011, a committee of unsecured creditors was
appointed. Schoff McCabe, P.C. represents the Committee. Craig
Howe, CPA, and Howe, Keller & Hunter, P.C., serve as the
Committee's accountants.
GELT PROPERTIES: Disclosure Statement Hearing Moved to April 11
---------------------------------------------------------------
The hearing on the approval of the disclosure statement explaining
Gelt Properties, LLC, et al.'s proposed Plan of Reorganization has
been continued to April 11, 2012.
As reported in the Troubled Company Reporter on Feb. 20, 2012,
the Plan provides that all of the assets of the Debtors will be
sold and liquidated, rented or leased, developed and maintained,
in the ordinary course of the Debtor's business. Cash payments
made pursuant to the Plan will be in the United States funds, by
check drawn on a domestic bank pr by wire transfer from a domestic
bank. All cash distributions will be made by the Debtors.
A full-text copy of the Disclosure
Statement is available for free at:
http://bankrupt.com/misc/GELT_PROPERTIES_ds.pdf
About Gelt Properties
Based in Huntington Valley, Pennsylvania, Gelt Properties, LLC,
and affiliate Gelt Financial Corporation borrow money from
traditional lenders and make loans to commercial borrowers. They
also acquire and manage real estate. Gelt Properties and Gelt
Financial filed for (Bankr. E.D. Pa. Case Nos. 11-15826 and 11-
15826) on July 25, 2011. Judge Magdeline D. Coleman presides over
the cases. Albert A. Ciardi, III, Esq., Jennifer E. Cranston,
Esq., and Thomas Daniel Bielli, Esq., at Ciardi Ciardi & Astin,
P.C., in Philadelphia, Pa., serve as the Debtors' bankruptcy
counsel. The petitions were signed by Uri Shoham, the Debtors'
chief financial officer. The Debtors' other professionals
include: Eisenberg, Gold & Cettei P.C. as its special counsel to
provide proper legal counsel to the Debtors with regard to
defending against certain actions, Cohen and Forman as their
special counsel to advise them upon all matters which may arise or
which may be incident to the bankruptcy proceedings.
Gelt Properties disclosed $4.73 million in assets and
$4.84 million in liabilities as of the Chapter 11 filing. Its
affiliate, Gelt Financial has scheduled $20.3 million in assets
and $17.05 million in liabilities as of the Chapter 11 filing.
On Sept. 15, 2011, a committee of unsecured creditors was
appointed. Schoff McCabe, P.C. represents the Committee. Craig
Howe, CPA, and Howe, Keller & Hunter, P.C., serve as the
Committee's accountants.
GELT PROPERTIES: Bank Says Claim Understated, Wants Stay Lifted
---------------------------------------------------------------
Bucks County Bank asks the Bankruptcy Court to terminate the
automatic stay under Section 362 of the Bankruptcy Code.
Debtor Gelt Financial Corporation executed and delivered to the
Bank a demand Promissory Note dated July 23, 2007, in the maximum
principal amount of $2 million. As partial security for the
repayment of the Loan, with interest and other charges, Debtor Gel
Properties executed and delivered to the Bank a Surety Agreement
pursuant to which the Debtor unconditionally guaranteed to the
Bank the due and punctual payment and performance of all of the
obligations of the Debtor to the Bank.
The Debtor defaulted on the obligations under the Loan Documents
by, among other things, failing to make payments when due
thereunder.
As of the Petition Date, the Debtor was indebted to the Bank in
the amount of $1.37 million, plus accruing interest and costs.
Robert A. Badman, Esq. at Curtin & Heefner LLP, in Morrisville,
Pennsylvania, attorney for the Bank, asserts that the Disclosure
Statement and the Plan of Reorganization understate the claim of
the Bank by listing only the principal amount due and owing the
Bank and failing to include the accrued interest and late charges.
The Debtor's Plan in Section 3.5 lists the total amount due and
owing to the Bank as $1,191,462, which amount is comprised of a
secured lien in the amount of $120,991 on Property A, a secured
lien in the amount of $48,629 on Property B, and a secured claim
in the amount of $1,021,842 with respect to other loans and
mortgages.
"The Plan is not confirmable in that Debtor proposes interest
payments to the Bank and other secured creditors, without the
consent of Bank and those other creditors, in amounts
significantly below the amounts required under the Bankruptcy
Code, and Debtor's income is insufficient to fund a plan with
payments based on acceptable rates of interest," Mr. Badman tells
the Court.
The Bank asks the Court to prohibit the Debtor from continuing to
use cash collateral.
The hearing on the Motion for Relief from Stay has been continued
to April 24, 2012, at 11:00 a.m.
About Gelt Properties
Based in Huntington Valley, Pennsylvania, Gelt Properties, LLC,
and affiliate Gelt Financial Corporation borrow money from
traditional lenders and make loans to commercial borrowers. They
also acquire and manage real estate. Gelt Properties and Gelt
Financial filed for (Bankr. E.D. Pa. Case Nos. 11-15826 and 11-
15826) on July 25, 2011. Judge Magdeline D. Coleman presides over
the cases. Albert A. Ciardi, III, Esq., Jennifer E. Cranston,
Esq., and Thomas Daniel Bielli, Esq., at Ciardi Ciardi & Astin,
P.C., in Philadelphia, Pa., serve as the Debtors' bankruptcy
counsel. The petitions were signed by Uri Shoham, the Debtors'
chief financial officer. The Debtors' other professionals
include: Eisenberg, Gold & Cettei P.C. as its special counsel to
provide proper legal counsel to the Debtors with regard to
defending against certain actions, Cohen and Forman as their
special counsel to advise them upon all matters which may arise or
which may be incident to the bankruptcy proceedings.
Gelt Properties disclosed $4.73 million in assets and
$4.84 million in liabilities as of the Chapter 11 filing. Its
affiliate, Gelt Financial has scheduled $20.3 million in assets
and $17.05 million in liabilities as of the Chapter 11 filing.
On Sept. 15, 2011, a committee of unsecured creditors was
appointed. Schoff McCabe, P.C. represents the Committee. Craig
Howe, CPA, and Howe, Keller & Hunter, P.C., serve as the
Committee's accountants.
GETTY PETROLEUM: To Terminate Leases on 56 Stations
---------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Getty Petroleum Marketing Inc. filed a motion to
terminate leases for 56 of its 825 gasoline stations. The company
says the leases are a burden because they generate less income
than the rent paid to the owner. Getty arranged a hearing on
March 29 to terminate the leases before April 1 when a month's
rent comes due.
About Getty Petroleum
A remnant of J. Paul Getty's oil empire, Getty Petroleum Marketing
markets gasolines, hydraulic fluids, and lubricating oils through
a network of gas stations owned and operated by franchise holders.
A former subsidiary of Russian oil giant LUKOIL, the company
operates in the Mid-Atlantic and Northeastern US states. Getty
Petroleum Marketing's primary asset is the more than 800 gas
stations in the Mid-Atlantic states which are located on
properties owned by Getty Realty. After scaling back the
company's operations to cut debt, in 2011 LUKOIL sold Getty
Petroleum Marketing to investment firm Cambridge Petroleum Holding
for an undisclosed price.
Getty Petroleum and three affiliates filed for Chapter 11
bankruptcy (Bankr. S.D.N.Y. Case Nos. 11-15606 to 11-15609) on
Dec. 5, 2011. Judge Shelley C. Chapman presides over the case.
Loring I. Fenton, Esq., John H. Bae, Esq., Kaitlin R. Walsh, Esq.,
and Michael J. Schrader, Esq., at Greenberg Traurig, LLP, in New
York, N.Y., serve as Debtors' counsel. Ross, Rosenthal & Company,
LLP, serves as accountants for the Debtors. Getty Petroleum
Marketing, Inc., disclosed $46,592,263 in assets and $316,829,444
in liabilities as of the Petition Date. The petition was signed
by Bjorn Q. Aaserod, chief executive officer and chairman of the
board.
The Official Committee of Unsecured Creditors is represented by
Wilmer Cutler Pickering Hale and Dorr LLP. Alvarez & Marsal North
America, LLC, serves as the Committee's financial advisors.
GIBSON AND EPPS: Obtains Relief From Agreed Dismissal Order
-----------------------------------------------------------
Bankruptcy Judge Richard Stair, Jr. granted the Motion for Relief
from Judgment filed on Oct. 3, 2011, by Gary Epps, individually as
a member of Gibson and Epps, L.L.C., and on behalf of Gibson and
Epps, L.L.C., and Matthew W. Sexton, Receiver for Gibson and Epps,
L.L.C., which asks the Court to set aside an Agreed Order
Dismissing Case entered Nov. 4, 2010, to the extent that the
Agreed Dismissal Order directs the Debtor to execute a deed in
lieu of foreclosure to BSCMS 1999-CLFI Clinton Highway REO, LLC.
A copy of the Court's Memorandum dated March 21, 2012, is
available at http://is.gd/LFBQN2from Leagle.com.
Gibson and Epps first filed a voluntary Chapter 11 petition
(Bankr. E.D. Tenn. Case No. 10-32594) on May 25, 2010, to halt
foreclosure of its commercial real property located at 5727
Clinton Highway, Knoxville, Tennessee. The bankruptcy case was
dismissed June 3, 2010.
Prior to a second scheduled sale, on June 29, 2010, Jimmy Gibson,
the managing member, commenced a voluntary Chapter 11 petition
(Bankr. E.D. Tenn. Case No. 10-33074) on behalf of Gibson and
Epps.
BSCMS filed a Motion to Dismiss on July 14, 2010, which was later
resolved between the Debtor and BSCMS, culminating in entry of the
Agreed Dismissal Order on Nov. 4, 2010. In addition to dismissing
the Chapter 11 case, the Agreed Dismissal Order directed the
Debtor to execute and place into escrow a quit claim deed to the
5727 Clinton Highway Property and gave the Debtor until Dec. 31,
2010, to sell the 5727 Clinton Highway Property, after which the
Debtor would deliver the quit claim deed to BSCMS in lieu of
foreclosure.
The Debtor entered into a contract for the sale of the 5727
Clinton Highway Property with Florida Postal Investments on
Oct. 6, 2010; however, the sale did not close. On Nov. 18, 2010,
Mr. Gibson, as Managing Member of the Debtor, executed the
QuitClaim Deed in lieu of foreclosure in favor of BSCMS; however,
it was not delivered, and on Dec. 30, 2010, he once again executed
the QuitClaim Deed as well as a Settlement Agreement with BSCMS.
On Jan. 14, 2011, Mr. Epps's attorney contacted the attorney for
BSCMS to discuss possible resolutions, including conveyance of the
5727 Clinton Highway Property to Mr. Epps or a third party. On
Feb. 16, 2011, Mr. Epps, acting individually and on behalf of the
Debtor, filed a Complaint styled Gary Epps and Gibson & Epps, LLC
v. Gibson & Associates, Jimmy Gibson, Tammy C. Gibson, JT JB, LLC,
and BSCMS 1999-CLF1 Clinton Highway REO, LLC, No. 11CV026 in the
Circuit Court for Hamblen County, Tennessee, seeking an accounting
and damages for fraud and breach of fiduciary duty, contending
that Mr. Gibson retained money that should have been used as lease
payments to BSCMS, and asking the court to declare the QuitClaim
Deed void and that it be set aside or, in the alternative, seeking
imposition of a constructive trust or equitable lien as to the
5727 Clinton Highway Property to secure the equity and interests
of the Debtor. Matthew W. Sexton was appointed by the Hamblen
County Circuit Court as Receiver for Gibson and Epps, L.L.C., and
between February and August 2011, the parties to the State Court
Lawsuit engaged in mediation and settlement discussions.
The parties did not, however, reach an agreement, and BSCMS filed
a motion to dismiss the State Court Lawsuit on Aug. 5, 2011,
averring that the Hamblen County Circuit Court lacked jurisdiction
to vacate the Agreed Dismissal Order.
On Oct. 3, 2011, the Movants filed the Motion for Relief from
Judgment, asking the court to set aside the Agreed Dismissal Order
to the extent it authorized and directed execution of the
QuitClaim Deed, averring that Mr. Epps did not authorize the
filing of the bankruptcy case or entry of the Agreed Dismissal
Order, that Mr. Gibson knowingly gave false addresses for Mr.
Epps, resulting in his not receiving notice of the bankruptcy
filing, that a transfer of the 5727 Clinton Highway Property
results in a windfall to BSCMS, and that Mr. Gibson's conduct
constituted fraud upon the court. On Oct. 24, 2011, the Debtor's
attorney filed a Response stating that Mr. Gibson had not been in
recent communication with him but that he had spoken to the state
court receiver who has joined in the Motion for Relief from
Judgment, and that it appears to be in the best interest of the
Debtor's principals if the Motion for Relief from Judgment is
granted.
Mr. Gibson also filed a Response to Motion for Relief from
Judgment, acknowledging that the addresses provided for Mr. Epps
in the bankruptcy filing were incorrect but were the result of an
unintentional mistake. He also admitted that he did not obtain
authorization from Mr. Epps to file the Debtor's bankruptcy case
or enter into the Agreed Dismissal Order.
GRUBB & ELLIS: Competitors Eyeing Building Management Contracts
---------------------------------------------------------------
Laura Kusisto, writing for The Wall Street Journal, reports that
Grubb & Ellis Co.'s competitors are now eyeing the firm's building
management contracts.
"There's no doubt that all of their competitors are circling.
They're looking at the carcass and seeing what's worth picking
over," says Andrew Roos, of Colliers International, according to
the Journal.
People familiar with the firm told the Journal that Grubb & Ellis
manages some 15 million square feet of property in the New York
area and about 200 million square feet nationally.
WSJ notes most building management contracts give landlords the
ability to boot their building managers with a mere 30 days'
notice. However, owners of buildings managed by Grubb & Ellis are
precluded by bankruptcy law from terminating contracts or giving
notice to terminate without seeking bankruptcy court approval.
Grubb & Ellis is awaiting bankruptcy court approval of its deal to
sell the business to BGC Partners Inc.
BGC is a spinoff of Cantor Fitzgerald. Last year it acquired
Newmark Knight Frank, a prominent firm in the New York City
region.
According to WSJ, a Newmark spokeswoman says the two firms
combined would manage 62 million square feet in the tri-state
area. That would help bring the firm closer behind large
commercial property managers in the New York City area: Cushman &
Wakefield, CBRE Group Inc., and Jones Lang LaSalle.
About Grubb & Ellis
Grubb & Ellis Company -- http://www.grubb-ellis.com/-- is a
commercial real estate services and property management company
with more than 3,000 employees conducting throughout the United
States and the world. It is one of the oldest and most recognized
brands in the industry.
Grubb & Ellis and 16 affiliates filed for Chapter 11 bankrutpcy
(Bankr. S.D.N.Y. Lead Case No. 12-10685) on Feb. 21, 2012, to sell
almost all its assets to BGC Partners Inc. The Santa Ana,
California-based company disclosed $150.16 million in assets and
$167.2 million in liabilities as of Dec. 31, 2011.
Judge Martin Glenn presides over the case. The Debtors have
engaged Togut, Segal & Segal, LLP as general bankruptcy counsel,
Zuckerman Gore Brandeis & Crossman, LLP, as general corporate
counsel, and Alvarez & Marsal Holdings, LLC, as financial advisor
in the Chapter 11 case. Kurtzman Carson Consultants is the claims
and notice agent.
Pursuant to the term sheet signed by the parties, BGC will buy the
assets for $30.02 million, consisting of a credit bid the full
principal amount outstanding under the (i) $30 million credit
agreement dated April 15, 2011, with BGC Note, (ii) the amounts
drawn under the $4.8 million facility, and (iii) the cure amounts
due to counterparties. BGC can terminate the contract if the sale
order has not been entered by the bankruptcy court in 25 days
after the execution of the Asset Purchase Agreement.
BGC Partners, Inc., and its affiliate, BGC Note Acquisition Co.,
L.P., the DIP lender and Prepetition Secured Lender, are
represented in the case by Emanuel C. Grillo, Esq., at Goodwin
Procter LLP.
HARRON COMMS: Moody's Rates $225MM Senior Unsecured Bonds 'Caa1'
----------------------------------------------------------------
Moody's Investors Service assigned a Caa1 rating to the proposed
$225 million senior unsecured bonds of Harron Communications, LP.
The company intends to use proceeds primarily to fund the
redemption of the remaining 25% equity interest of BV Investment
Partners (BV) and to repay a portion of its outstanding term
loans. Moody's also affirmed the B2 corporate family rating,
upgraded the senior secured rating to B1 from B2 and the
probability of default rating to B2 from B3 as a consequence of
the increase in junior capital.
The transaction weakens the credit profile, but the B2 CFR
anticipated the eventual buyout of BV's ownership stake.
Furthermore, the simplified capital structure and the terms of the
credit agreement limit the likelihood of future equity
distributions causing a material negative impact on the credit
profile over the intermediate term. Pro forma for the transaction,
leverage rises to approximately 6.5 times debt-to-EBITDA from
approximately 5 times, and annual interest expense will increase,
but Moody's forecasts continued positive free cash flow.
A summary of the actions follows.
Harron Communications, LP
Senior Unsecured Bonds, Assigned Caa1, LGD5, 86%
Probability of Default Rating, Upgraded to B2 from B3
Corporate Family Rating, Affirmed B2
MetroCast Cablevision of New Hampshire, LLC
Senior Secured Bank Credit Facility, Upgraded to B1, LGD3,
32% from B2, LGD3, 35%
Ratings Rationale
High leverage (estimated at approximately 6.5 times debt-to-EBITDA
pro forma for the transaction) poses risk for a small company
operating in a competitive environment, driving Harron's B2 CFR.
However, Moody's expects the combination of EBITDA growth and debt
repayment to lower leverage over the next couple years. Also, the
solid EBITDA margin (approximately 39%) and good liquidity
profile, including expectations for continued positive free cash
flow, enable the company to better manage the leverage.
Harron currently benefits from a relatively more benign
competitive environment than many of its cable peers, with no FiOS
overlap and minimal uVerse overlap, positioning it well for
continued high speed data subscriber gains and upside from its
nascent commercial business. Nevertheless, the maturity of the
core video product and formidable competition from direct
broadcast satellite operators constrains overall growth prospects,
given that video still comprises over half of revenue and almost
half of EBITDA.
Moody's upgraded the secured bank debt to B1 from B2, in
accordance with Moody's Loss Given Default (LGD) Methodology. With
the issuance of senior unsecured debt and paydown of existing term
loans, bank lenders would benefit from a layer of junior capital,
whereas now the bank debt constitutes substantially all
liabilities in the capital structure. Also in accordance with
Moody's LGD Methodology, Moody's upgraded the probability of
default rating to B2 from B3, because Moody's considers the
probability of default lower in a mixed capital structure than for
an all bank capital structure. Moody's recovery assumption is also
lower, now 50% compared to 65% prior to the proposed transaction.
However, because of the junior capital and modest paydown of term
loans, the LGD point estimate on the secured credit facility
improves slightly to 32% from 35%.
The stable outlook assumes continued positive free cash flow and
that leverage will trend below 6 times debt-to-EBITDA over the
next 18 months. The outlook also incorporates expectations for
continued EBITDA growth driven primarily by gains in high speed
data and phone subscribers, as well as some increase in pricing.
Lack of scale constrains the rating, but Moody's would consider an
upgrade with progress toward and a commitment to maintaining debt-
to-EBITDA below 4 times and free cash flow to debt in the high
single digits. An upgrade would also require expectations for
continued EBITDA growth and maintenance of good liquidity.
Sustained leverage exceeding 6.75 times debt-to-EBITDA or
sustained free cash flow-to-debt below 2% could pressure the
rating down. Inability to generate EBITDA growth could also have
negative ratings implications.
The principal methodology used in rating Harron was the Global
Cable Television Industry Methodology published in July 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.
Headquartered in Frazer, PA, Harron Communications, L.P. houses
the cable operating assets of Gans Communications, LP, MetroCast
Cablevision of New Hampshire, LLC, MetroCast Communications of
Connecticut, LLC, and MetroCast Communications of Mississippi,
LLC. Its cable operating companies serve approximately 172,000
video subscribers, 126,000 high speed data subscribers, and 43,000
telephone subscribers across New Hampshire/Maine, Connecticut,
Maryland/Virginia, Mississippi/Alabama, Pennsylvania, and South
Carolina. The Harron family and management own 75% of common
equity interests of the company with Boston Ventures Partnership
VI holding the remaining 25%. Pro forma for the proposed
transaction, the Harron family will own almost all of the company.
HAWKER BEECHCRAFT: Bank Debt Trades at 26% Off in Secondary Market
------------------------------------------------------------------
Participations in a syndicated loan under which Hawker Beechcraft
is a borrower traded in the secondary market at 73.89 cents-on-
the-dollar during the week ended Friday, March 23, 2012, an
increase of 1.12 percentage points from the previous week
according to data compiled by Loan Pricing Corp. and reported in
The Wall Street Journal. The Company pays 200 basis points above
LIBOR to borrow under the facility. The bank loan matures on
March 26, 2014, and carries Moody's Caa2 rating and Standard &
Poor's CCC rating. The loan is one of the biggest gainers and
losers among 192 widely quoted syndicated loans with five or more
bids in secondary trading for the week ended Friday.
About Hawker Beechcraft
Hawker Beechcraft Acquisition Company, LLC, headquartered in
Wichita, Kansas, manufactures business jets, turboprops and piston
aircraft for corporations, governments and individuals worldwide.
The Company reported a net loss of $214 million on $1.65 billion
of total sales for the nine months ended Sept. 30, 2011, compared
with a net loss of $238.60 million on $1.80 billion of total sales
for the same period the year before. Hawker Beechcraft reported a
net loss of $304.3 million in 2010, a net loss of $451.3 million
in 2009, and a net loss of $157.2 million in 2008.
The Company's balance sheet at Sept. 30, 2011, showed $3.10
billion in total assets, $3.49 billion in total liabilities and a
$383.20 million total deficit.
* * *
As reported by the Troubled Company Reporter on Sept. 16, 2011,
Moody's Investors Service has lowered all the credit ratings,
including the corporate family rating to Caa3 from Caa2, of Hawker
Beechcraft Acquisition Company LLC. The rating outlook is
negative.
The downgrades reflect Hawker Beechcraft's mounting retained
deficit and Moody's view that the soft economy dims chances for
profitability anytime soon. Although limited near-term debt
maturities exist, with the prospect of further losses Moody's
views the capital structure to be unsustainable. Pronounced risk
that some form of restructuring of the company's debt obligations
may occur underscores the negative rating outlook. Softness in
most developed economies should constrain demand for the smaller
and mid-sized cabin aircraft that comprise the company's Business
and General Aviation product portfolio. While management has
aggressively lowered overhead and cut production costs, the
revenue outlook seems weak. As of June 30, 2011, the debt to book
capital ratio was 114% and the trailing 12-month EBITDA to
interest ratio was 0.2x (Moody's adjusted basis).
According to the Dec. 5, 2011 edition of the TCR, Standard &
Poor's Ratings Services lowered its ratings on Hawker Beechcraft,
including the corporate credit rating to 'CCC' from 'CCC+'. "The
downgrade reflects Hawker's continued poor credit protection
measures and tighter liquidity resulting from declining revenues,
significant (albeit improving) losses, and weak cash generation,"
said Standard & Poor's credit analyst Christopher DeNicolo. "We
have concerns about the company's ability to maintain covenant
compliance."
HAWKER BEECHCRAFT: Bank Debt Trades at 26% Off in Secondary Market
------------------------------------------------------------------
Participations in a syndicated loan under which Hawker Beechcraft
is a borrower traded in the secondary market at 73.60 cents-on-
the-dollar during the week ended Friday, March 23, 2012, an
increase of 0.22 percentage points from the previous week
according to data compiled by Loan Pricing Corp. and reported in
The Wall Street Journal. The Company pays 850 basis points above
LIBOR to borrow under the facility. The bank loan matures on
March 26, 2014, and carries Standard & Poor's CCC rating. The
loan is one of the biggest gainers and losers among 192 widely
quoted syndicated loans with five or more bids in secondary
trading for the week ended Friday.
About Hawker Beechcraft
Hawker Beechcraft Acquisition Company, LLC, headquartered in
Wichita, Kansas, manufactures business jets, turboprops and piston
aircraft for corporations, governments and individuals worldwide.
The Company reported a net loss of $214 million on $1.65 billion
of total sales for the nine months ended Sept. 30, 2011, compared
with a net loss of $238.60 million on $1.80 billion of total sales
for the same period the year before. Hawker Beechcraft reported a
net loss of $304.3 million in 2010, a net loss of $451.3 million
in 2009, and a net loss of $157.2 million in 2008.
The Company's balance sheet at Sept. 30, 2011, showed $3.10
billion in total assets, $3.49 billion in total liabilities and a
$383.20 million total deficit.
* * *
As reported by the Troubled Company Reporter on Sept. 16, 2011,
Moody's Investors Service has lowered all the credit ratings,
including the corporate family rating to Caa3 from Caa2, of Hawker
Beechcraft Acquisition Company LLC. The rating outlook is
negative.
The downgrades reflect Hawker Beechcraft's mounting retained
deficit and Moody's view that the soft economy dims chances for
profitability anytime soon. Although limited near-term debt
maturities exist, with the prospect of further losses Moody's
views the capital structure to be unsustainable. Pronounced risk
that some form of restructuring of the company's debt obligations
may occur underscores the negative rating outlook. Softness in
most developed economies should constrain demand for the smaller
and mid-sized cabin aircraft that comprise the company's Business
and General Aviation product portfolio. While management has
aggressively lowered overhead and cut production costs, the
revenue outlook seems weak. As of June 30, 2011, the debt to book
capital ratio was 114% and the trailing 12-month EBITDA to
interest ratio was 0.2x (Moody's adjusted basis).
According to the Dec. 5, 2011 edition of the TCR, Standard &
Poor's Ratings Services lowered its ratings on Hawker Beechcraft,
including the corporate credit rating to 'CCC' from 'CCC+'. "The
downgrade reflects Hawker's continued poor credit protection
measures and tighter liquidity resulting from declining revenues,
significant (albeit improving) losses, and weak cash generation,"
said Standard & Poor's credit analyst Christopher DeNicolo. "We
have concerns about the company's ability to maintain covenant
compliance."
HOMER CITY: Fitch Lowers Rating on $830 Million Bonds to 'B'
------------------------------------------------------------
Fitch Ratings has downgraded Homer City Funding, LLC's (HCF)
$300 million and $530 million Pass-Through Bonds to 'B' from
'BB-'. The downgrade reflects ongoing challenges at the project
as a merchant coal facility in a low energy price environment as
well as the impending $700 million-$750 million of capital needed
to fund emissions controls. The Negative Watch on the pass-
through bonds reflects the uncertainty regarding the outcome of a
missed April 2012 equity payment and the possible termination of
the senior rent reserve letter of credit (LOC).
-- Volatile Cash Flow: Financial performance reflects
non-contracted energy revenues, volatile coal prices and
exposure to increasing environmental control costs. Poor
current performance is due to historically low capacity
factors from suppressed energy prices and persistently high
coal prices, leading to insufficient cash flow available to
pay total rent service.
-- Insufficient Liquidity: The LOC-funded senior rent reserve
may be terminated if EME Homer City Generation LP (HGC)
misses the equity rent payment due April 1, 2012, requiring
HCG to cash fund the reserve. Cash flow is insufficient to
fund the $48 million reserve requirement.
-- Emissions Upgrades Required: Due to the emissions allowances
proposed under the Cross State Air Pollution Rule (CSAPR) and
environmental concerns under the Mercury Air Toxics Standards
(MATS), HCF's economic viability relies on the installation
of scrubbers. Without these, Units 1 & 2 would likely cease
operations under the current low gas and dark spreads
environment.
WHAT COULD TRIGGER A RATING ACTION
-- Liquidity Risk: Forced funding of the reserve LOC or the
inability to reach an agreement for additional financing with
the owner- lessors;
-- Limited Energy Margins: Further strain on dark spreads could
threaten payment of senior rent service and result in
negative rating action.
The bondholders receive a first priority mortgage lien on all
right, title and interest in HCF's property, including the Homer
City generating facility, the site lease, cash accounts, and
project documents. HCF's undivided interest in the facility and
certain specified general intangibles are also pledged to the
bondholders.
The low gas environment and high coal costs have severely
decreased margins at this merchant facility. The persistence of
low energy prices and decreasing dark spreads have forced coverage
to near breakeven levels for 2011 with less than 1.0 times (x)
coverage expected in the near term compared to over 2.0x in 2010,
according to Fitch calculations.
Homer City has been working towards a plan to obtain third party
funding for the roughly $700 million to $750 million needed for
scrubber installation on Units 1 & 2 due to CSAPR and MATS. The
project has yet to receive consent from the existing bondholders
to exceed the additional indebtedness provision that limits this
number to $300 million. Homer City has been working with the
owner-lessor to reach an agreement for financing and plans to meet
a 2014 in-service date.
Failure to meet the April 2012 equity rent payment may trigger
termination of the LOC, wherein Homer City would be required to
fund this reserve or face remedies under the sale leaseback that
include termination or foreclosure upon the project. GE has
announced their intention to maintain project operations subject
to completion of negotiations with stakeholders.
At the end of December 2011, the courts issued a stay of the
CSAPR, pending review of the case that Homer City has brought
forth against the EPA. This ruling effectively postpones the
ruling from the Jan. 1, 2012 implementation date and forces the
EPA to continue under CAIR due to the claim from the plaintiffs
that CSAPR was too punitive. Several different states and power
companies came forward on behalf of this suit in order to buy more
time to comply with the rule and allow the EPA more time to adjust
the rule. The hearing for CSAPR is expected to take place in
April 2012.
EME Homer City Generation L.P. (HCG) leases and operates a single
facility with three coal-fired electric generating units in
western Pennsylvania with an aggregate capacity of 1,884 MW. HCG
is an indirect, wholly owned subsidiary of Edison Mission Energy
(EME; IDR 'B-'; Negative Outlook by Fitch). EME is a wholly owned
subsidiary of Mission Energy Holding Company and is an indirect
wholly owned subsidiary of Edison International. In May 1999, EME
refinanced $830 million of acquisition debt secured by the
facility. In 2001, General Electric Capital Corp. (GECC)
purchased the facility for cash and assumed the rated debt as part
of a sale-leaseback transaction with HCG. The debt was exchanged
for the pass-through bonds, which were assumed by a special
purpose vehicle, HCF, indirectly owned by GECC. Currently,
MetLife owns a minority share of HCF. HCF bondholders rely solely
on rent payments received from HCG.
HCG sells energy and capacity into the PJM Interconnection and
NYISO on a merchant basis. HCG has a contract with Edison Mission
Marketing & Trading, Inc. (EMMT), an affiliated marketing entity,
to sell energy and capacity. EMMT engages in forward sales and
hedging transactions to manage electricity price exposure.
HORNE INTERNATIONAL: Marla Perdue Appointed Interim CFO
-------------------------------------------------------
Marla Perdue, Horne International, Inc.'s Accounting Manager, has
been named to serve as Interim Chief Financial Officer.
Ms. Perdue joined Horne International, Inc., on July 25, 2011, as
the Accounting Manager. Prior to joining Horne International, her
comprehensive experience encompasses Financial Reporting, Employee
Benefit Plans, Internal Control Systems and Full-scope accounting
for small to medium sized businesses. She has over 12 years
experience served in increasing roles from Clerk to Controller.
She has experience in commercial, manufacturing and government
environments. In 2006, Marla earned her Bachelor of Science
degree with a major in Accounting from George Mason University, in
Fairfax, Virginia.
About Horne International
Fairfax, Va.-based Horne International, Inc., is an engineering
services company focused on provision of integrated, systems
approach based solutions to the energy and environmental sectors.
The Company reported net income of $158,000 on $3.81 million of
revenue for the nine months ended Sept. 25, 2011, compared with a
net loss of $955,000 on $2.61 million of revenue for the nine
months ended Sept. 26, 2010.
The Company's balance sheet at Sept. 25, 2011, showed $1.35
million in total assets, $1.95 million in total liabilities and a
$600,000 total stockholders' deficit.
Stegman & Company, in Baltimore, Md., expressed substantial
doubt about the Company's ability to continue as a going concern,
following the Company's 2010 results. The independent auditors
noted that the Company has experienced continuing net losses for
each of the last four years and as of Dec. 26, 2010, current
liabilities exceeded current assets by $1.0 million.
INOVA TECHNOLOGY: Incurs $657,000 Net Loss in Jan. 31 Quarter
-------------------------------------------------------------
Inova Technology, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing a
net loss of $657,433 on $3.73 million of revenue for the three
months ended Jan. 31, 2012, compared with a net loss of $797,530
on $4.39 million of revenue for the same period during the prior
year.
The Company reported a net loss of $486,798 on $14.44 million of
revenue for the nine months ended Jan. 31, 2012, compared with net
income of $999,882 on $17.06 million of revenue for the same
period a year ago.
The Company reported a net loss of $3.35 million for the year
ended April 30, 2011, compared with a net loss of $7.06 million
during the prior year.
The Company's balance sheet at Jan. 31, 2012, showed $7.30 million
in total assets, $17.69 million in total liabilities and a $10.38
million total stockholders' deficit.
The Company has an accumulated deficit and negative working
capital and is in default on the majority of its notes payable as
of Jan. 31, 2012. These conditions raise substantial doubt as to
the Company's ability to continue as a going concern.
MaloneyBailey LLP, in Houston, Texas, noted that the Company
incurred losses from operations for fiscal 2011 and 2010 and has a
working capital deficit as of April 30, 2011. According to the
independent auditors, these factors raise substantial doubt about
Inova's ability to continue as a going concern.
A copy of the Form 10-Q is available for free at:
http://is.gd/XI8sjq
About Inova Technology
Based in Las Vegas, Nevada, Inova Technology, Inc. (OTC BB: INVA)
-- http://www.inovatechnology.com/-- through its subsidiaries,
provides information technology (IT) consulting services in the
United States. It also manufactures radio frequency
identification (RFID) equipment; and provides computer network
solutions. The company was formerly known as Edgetech Services
Inc. and changed its name to Inova Technology, Inc., in 2007.
IMPERIAL PETROLEUM: Incurs $7.1 Million Net Loss in Jan. 31 Qtr.
----------------------------------------------------------------
Imperial Petroleum, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
a net loss of $7.06 million on $13.33 million of total operating
income for the three months ended Jan. 31, 2012, compared with a
net loss of $255,821 on $13.19 million of total operating income
for the same period a year ago.
The Company reported a net loss of $8.16 million on $49.82 million
of total operating income for the six months ended Jan. 31, 2012,
compared with net income of $433,552 on $29.11 million of total
operating income for the same period during the prior year.
The Company's balance sheet at Jan. 31, 2012, showed $13.36
million in total assets, $19.63 million in total liabilities and a
$6.27 million total stockholders' deficit.
A copy of the Form 10-Q is available for free at:
http://is.gd/ABgfsn
About Imperial Petroleum
Headquartered in Evansville, Ind., Imperial Petroleum Inc.
(OTC BB: IPMN) operates as a diversified energy and mineral mining
company in the United States. Its oil and natural gas properties
include the Coquille Bay field located in Plaqumines Parish,
Louisiana; the Haynesville field located in Claiborne and Webster
Parishes in north Louisiana; the Bastian Bay field located in
Plaquemines parish, Louisiana; LulingField located in Guadalupe
county, Texas; and the Shrewsbury field in Grayson County and the
Claymour field in Todd County, western Kentucky.
As reported by the TCR on June 24, 2011, the Company anticipates
its current working capital will not be sufficient to meet its
required capital expenditures and that the Company will be
required to either access additional borrowings from its lender or
access outside capital. Currently the Company projects it will
require non-discretionary capital expenditures of approximately
US$500,000 in the next fiscal year to re-establish and maintain
economic levels of production at Coquille Bay. Without access to
such capital for non-discretionary projects, the Company's
production may be significantly curtailed or shut in and
jeopardize its leases.
Weaver Martin & Samyn, LLC, in Kansas City Missouri, expressed
substantial doubt about the Company's ability to continue as a
going concern. The independent auditors noted that the Company
has suffered recurring losses from operations and is dependent
upon obtaining debt financing for funds to meet its cash
requirements.
JEFFRIE LONG: Valleycrest Response Deadline Moved to April 2
------------------------------------------------------------
Bankruptcy Judge Thomas J. Catliota signed off on a Stipulation
and Consent Order Extending Deadline To April 2, 2012 To File
Responsive Pleading To Complaint And Rule 26(F) Report in the
lawsuit, Jeffrie and Sharon Long, Plaintiffs, v. Valleycrest
Landscape Development, Inc., Defendants, Adv. Proc. No. 12-00095
(Bankr. D. Md.). The Longs and Valleycrest also agree that the
time for filing a joint Rule 26(f) report is extended to April 19,
2012. A copy of the Stipulation dated March 21, 2012, is
available at http://is.gd/uA9Hd6from Leagle.com.
Jeffrie Long and Sharon Long filed a Chapter 11 petition (Bankr.
D. Md. Case No. 11-29719) on Oct. 3, 2011.
INDIANAPOLIS DOWNS: Loan Maturity Extended One Year
---------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Indianapolis Downs LLC received bankruptcy court
approval for a one-year extension of financing for the Chapter
11 reorganization. Absent the amendment, financing would have
expired in April. The track is paying a fee of 1% of the
outstanding amount of the loan. The company says it is "still
formulating the terms of a plan and discussing a possible
contemplated sale process."
About Indianapolis Downs
Indianapolis Downs LLC operates Indiana Live --
http://www.indianalivecasino.com/-- a combined race track and
casino at a state-of-the-art 283 acre Shelbyville, Indiana site.
It also operates two satellite wagering facilities in Evansville
and Clarksville, Indiana. Total revenue for 2010 was $270
million, representing an 8.7% increase in 2009. The casino
captured 53% of the Indianapolis market share.
In July 2001, Indianapolis Downs was granted a permit to conduct a
horse track operation in Shelvyville, Indiana, and started
operating the track in 2002. It was granted permission to operate
the casino at the racetrack operation in May 2007. The casino
began operations in July 2010.
Indianapolis Downs and subsidiary, Indianapolis Downs Capital
Corp., sought Chapter 11 protection (Bankr. D. Del. Lead Case No.
11-11046) in Wilmington, Delaware, on April 7, 2011. Indianapolis
Downs estimated $500 million to $1 billion in assets and up to
$500 million in debt as of the Chapter 11 filing. According to a
court filing, the Debtor owes $98,125,000 on a first lien debt. It
also owes $375,000,000 on secured notes and $72,649,048 on
subordinated notes.
Matthew L. Hinker, Esq., Scott D. Cousins, Esq., and Victoria
Watson Counihan, Esq., at Greenberg Traurig, LLP in Wilmington,
Delaware, have been tapped as counsel to the Debtors. Christopher
A. Ward, Esq., at Polsinelli Shughart PC, in Wilmington, Delaware,
is the conflicts counsel. Lazard Freres & Co. LLC is the
investment banker. Bose Mckinney & Evans LLP and Bose Public
Affairs Group LLC serve as special counsel. Kobi Partners, LLC,
is the restructuring services provider. Epiq Bankruptcy
Solutions is the claims and notice agent.
INFUSYSTEM HOLDINGS: Says Covenant Violation Looms
--------------------------------------------------
Deloitte & Touche LLP, in Detroit, Michigan, said in an audit
report dated March 16, 2012 that there is substantial doubt on the
ability of Infusystem Holdings, Inc., to continue as a going
concern. Deloitte reviewed the Company's consolidated financial
statements for the year ended Dec. 31, 2011. The audit firm said
the possibility of a change in the majority representation of the
Company's Board of Directors and consequent event of default under
its credit facility, which would allow the lenders to cause the
debt of $24.0 million to become immediately due and payable,
raises substantial doubt about the Company?s ability to continue
as a going concern.
In its Annual Report for the year ended Dec. 31, 2011, filed on
Form 10-K with the Securities and Exchange Commission, Infusystem
disclosed that an activist stockholder group consisting of
Kleinheinz Capital Partners, Meson Capital Partners, Boston Avenue
Capital and certain of their affiliates is seeking to gain control
of the Company's Board. The stockholders represent roughly 54% of
the outstanding shares of the Company. The Kleinheinz Dissident
Group has circulated to stockholders a consent solicitation
requesting written agent designations from the Company's
stockholders to enable them to call a special meeting of
stockholders to consider the removal of the Company's current
Board without cause, and to replace the Board with individuals
nominated by the Kleinheinz Dissident Group.
On Feb. 27, 2012, the Kleinheinz Dissident Group delivered
documentation to the Company purporting to contain agent
designations from a majority of stockholders and demanding that
the Company call a special meeting. In addition, on Feb. 27,
2012, the Kleinheinz Dissident Group delivered notice to the
Company stating its intention to nominate a competing slate for
election to the Company's Board at the Company's regular 2012
annual meeting.
On March 5, 2012 the Company announced that it had determined that
the demand for a call of a special meeting met the Company's by-
law requirement and that the Company would reschedule such meeting
on or before May 12, 2012. The Company cannot predict the outcome
of this matter at this time. On March 5, 2012 the Company
announced that it had determined that the demand for a call of a
special meeting met the Company?s by-law requirement.
According to Infusystem, if the stockholders were successful in
electing their own slate of directors, it would result in a change
in the majority of the Company's Board. Under the terms of the
Company?s credit facility with Bank of America, N.A. and KeyBank
National Association, a change in the majority of the Board would
constitute a change in control and an event of default, which
would allow the lenders to cause the debt to be immediately due
and payable. Given the Company?s cash balance at Dec. 31, 2011 of
roughly $800,000 and estimated 2012 liquidity, the Company would
be unable to repay the $24.0 million in debt if it became due in
May 2012.
Management has attempted to negotiate with the stockholders to
reach an agreement prior to the Company's annual meeting or the
special meeting demanded by the Kleinheinz Dissident Group.
InfuSystem posted revenue for the year ended Dec. 31, 2011, of
$54.6 million, a 16% increase compared to $47.2 million for the
year ended Dec. 31, 2010. InfuSystem had total assets of $76.2
million and total liabilities of $36.1 million as of Dec. 31,
2011.
A copy of InfuSystem's 2011 Annual Report is available at
http://is.gd/1etIPU
About InfuSystem Holdings
InfuSystem Holdings, Inc., operates through operating
subsidiaries, including InfuSystem, Inc., and First Biomedical,
Inc. InfuSystem provides infusion pumps and related services.
InfuSystem provides services to hospitals, oncology practices and
facilities and other alternate site healthcare providers.
Headquartered in Madison Heights, Michigan, InfuSystem delivers
local, field-based customer support, and also operates pump
service and repair Centers of Excellence in Michigan, Kansas,
California, and Ontario, Canada.
INTERNATIONAL MEDIA: Sold in $45 Million Debt Swap
--------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the three Asian-language television stations
belonging to International Media Group Inc. will be sold to
lenders in exchange for $45 million in secured debt, under
authorization given March 23 by the U.S. Bankruptcy Court in
Delaware. There were no competing bids, and thus the auction was
canceled.
About International Media Group
International Media Group Inc. and its affiliates operate
television station KSCI-TV (Channel 18) Long Beach, California;
KUAN-LP (Channel 48) Poway, California; and KIKU-TV (Channel 19)
Honolulu, Hawaii. KSCI, KUAN and KIKU focus primarily on the
large Asian markets of Southern California and Hawaii and offer
programming in six (6) main languages -- (i) Chinese; (ii) Korean;
(iii) Tagalog (Filipino); (iv) Vietnamese; (v) English; and (vi)
Japanese. The Television Stations' programming is a mix of
locally produced original news, entertainment, and talk shows,
purchased or syndicated foreign language programming, and paid
programming comprised principally of infomercials, per-inquiry and
direct response television advertisements.
KHAI Inc. owns all of the equity of KHLS Inc., which holds the FCC
license for KIKU-TV (Channel 19). KSCI Inc. owns all of the
equity of KHAI and of KSLS Inc., which holds the FCC license for
KSCI-TV (Channel 18) and KUANLP (Channel 48). International Media
Group Inc. owns all of the equity of KSCI.
AMG Intermediate LLC owns all of the equity of IMG, and AsianMedia
Group LLC owns all of the equity of AMG. Non-debtor AsianMedia
Investors I L.P. owns all of the equity of AsianMedia.
International Media Group and six affiliates filed Chapter 11
petitions (Bankr. D. Del. Lead Case No. 12-10140) on Jan. 9, 2012,
with the intent to sell their business as a going concern under
11 U.S.C. Sec. 363(a).
NRJ TV II LLC, an entity owned by the first lien lender, will be
the stalking horse bidder. As of Jan. 9, 2012, the Debtors owe
$77.3 million on a first lien debt, including $67 million on a
term-loan. Fortress Credit Corp. serves as agent. Unless outbid
at the auction, the pre-petition lenders will acquire the assets
in exchange for a credit bid of $45 million, will assume certain
liabilities, and fund a "carve-out". An auction and sale hearing
is contemplated to be held in March.
Judge Mary F. Walrath oversees the Debtors' cases. International
Media Group tapped Houlihan Lokey Capital, Inc., in October to
market the assets. Houlihan will continue marketing the assets
postpetition. William E. Chipman, Jr., Esq., and Mark D.
Olivere, Esq., at Cousins Chipman & Brown, LLC, in Wilmington,
Delaware, serve as the Debtors' bankruptcy counsel. The Debtors'
claims agent is Epiq Bankruptcy Solutions LLC.
In its petition, International Media Group estimated $100 million
to $500 million in assets and debts. The petition was signed by
Dennis J. Davis, chief restructuring officer.
No trustee, examiner or committee has been appointed in any of the
Debtors' cases.
INTERNATIONAL MEDIA: Gets Nod to Hire BCWS as Tax Consultants
-------------------------------------------------------------
The Hon. Mary F. Walrath of the U.S. Bankruptcy Court for the
District of Delaware has granted International Media Group Inc.,
et al., permission to employ Brigante, Cameron, Watters & Strong,
LLP as tax consultants.
As reported by the Troubled Company Reporter on March 21, 2012,
the Debtors related that on Feb. 2, 2012, Ernst & Young notified
the Debtors that they would be unable to continue assisting with
the Debtors' tax return preparation. In this relation, BCWS will
prepare the 2011 Federal (Form 1120) and 2011 California (Form
100) corporate income tax returns, and at the Debtors' request may
assist with the corporate income tax planning for 2011 and 2012
tax years.
About International Media Group
International Media Group Inc. and its affiliates operate
television station KSCI-TV (Channel 18) Long Beach, California;
KUAN-LP (Channel 48) Poway, California; and KIKU-TV (Channel 19)
Honolulu, Hawaii. KSCI, KUAN and KIKU focus primarily on the
large Asian markets of Southern California and Hawaii and offer
programming in six (6) main languages -- (i) Chinese; (ii) Korean;
(iii) Tagalog (Filipino); (iv) Vietnamese; (v) English; and (vi)
Japanese. The Television Stations' programming is a mix of
locally produced original news, entertainment, and talk shows,
purchased or syndicated foreign language programming, and paid
programming comprised principally of infomercials, per-inquiry and
direct response television advertisements.
KHAI Inc. owns all of the equity of KHLS Inc., which holds the FCC
license for KIKU-TV (Channel 19). KSCI Inc. owns all of the
equity of KHAI and of KSLS Inc., which holds the FCC license for
KSCI-TV (Channel 18) and KUANLP (Channel 48). International Media
Group Inc. owns all of the equity of KSCI.
AMG Intermediate LLC owns all of the equity of IMG, and AsianMedia
Group LLC owns all of the equity of AMG. Non-debtor AsianMedia
Investors I L.P. owns all of the equity of AsianMedia.
International Media Group and six affiliates filed Chapter 11
petitions (Bankr. D. Del. Lead Case No. 12-10140) on Jan. 9, 2012,
with the intent to sell their business as a going concern under
11 U.S.C. Sec. 363(a).
NRJ TV II LLC, an entity owned by the first lien lender, will be
the stalking horse bidder. As of Jan. 9, 2012, the Debtors owe
$77.3 million on a first lien debt, including $67 million on a
term-loan. Fortress Credit Corp. serves as agent. Unless outbid
at the auction, the pre-petition lenders will acquire the assets
in exchange for a credit bid of $45 million, will assume certain
liabilities, and fund a "carve-out". An auction and sale hearing
is contemplated to be held in March.
Judge Mary F. Walrath oversees the Debtors' cases. International
Media Group tapped Houlihan Lokey Capital, Inc., in October to
market the assets. Houlihan will continue marketing the assets
post-petition. William E. Chipman, Jr., Esq., and Mark D.
Olivere, Esq., at Cousins Chipman & Brown, LLC, in Wilmington,
Delaware, serve as the Debtors' bankruptcy counsel. The Debtors'
claims agent is Epiq Bankruptcy Solutions LLC.
In its schedules, International Media Group disclosed $206,825,047
in total assets and $233,218,073 in total liabilities.
INTERNATIONAL MEDIA: Court Okays Landis Rath as Bankruptcy Counsel
------------------------------------------------------------------
International Media Group Inc. and its affiliates have obtained
permission from the Hon. Mary F. Walrath of the U.S. Bankruptcy
Court for the District of Delaware to hire Landis Rath & Cobb LLP
as their bankruptcy counsel.
As reported by the Troubled Company Reporter on Jan. 16, 2012, the
current rates of LRC partners range from $475 to $720 per hour;
associates range for $325 to $430 per hour; paralegals range from
$210 to $230 per hour and legal assistants range from $100 to $130
per hour. Between Oct. 7, 2011 and Jan. 5, 2012, LRC received
$140,517 from the Debtors as advanced fee retainers.
The Court approved the final allowance of compensation in the
amount of $20,196.00 and reimbursement of expenses in the amount
of $2,218.77 to LRC for the period Jan. 9, 2012, through and
including Feb. 14, 2012.
About International Media Group
International Media Group Inc. and its affiliates operate
television station KSCI-TV (Channel 18) Long Beach, California;
KUAN-LP (Channel 48) Poway, California; and KIKU-TV (Channel 19)
Honolulu, Hawaii. KSCI, KUAN and KIKU focus primarily on the
large Asian markets of Southern California and Hawaii and offer
programming in six (6) main languages -- (i) Chinese; (ii) Korean;
(iii) Tagalog (Filipino); (iv) Vietnamese; (v) English; and (vi)
Japanese. The Television Stations' programming is a mix of
locally produced original news, entertainment, and talk shows,
purchased or syndicated foreign language programming, and paid
programming comprised principally of infomercials, per-inquiry and
direct response television advertisements.
KHAI Inc. owns all of the equity of KHLS Inc., which holds the FCC
license for KIKU-TV (Channel 19). KSCI Inc. owns all of the
equity of KHAI and of KSLS Inc., which holds the FCC license for
KSCI-TV (Channel 18) and KUANLP (Channel 48). International Media
Group Inc. owns all of the equity of KSCI.
AMG Intermediate LLC owns all of the equity of IMG, and AsianMedia
Group LLC owns all of the equity of AMG. Non-debtor AsianMedia
Investors I L.P. owns all of the equity of AsianMedia.
International Media Group and six affiliates filed Chapter 11
petitions (Bankr. D. Del. Lead Case No. 12-10140) on Jan. 9, 2012,
with the intent to sell their business as a going concern under
11 U.S.C. Sec. 363(a).
NRJ TV II LLC, an entity owned by the first lien lender, will be
the stalking horse bidder. As of Jan. 9, 2012, the Debtors owe
$77.3 million on a first lien debt, including $67 million on a
term-loan. Fortress Credit Corp. serves as agent. Unless outbid
at the auction, the pre-petition lenders will acquire the assets
in exchange for a credit bid of $45 million, will assume certain
liabilities, and fund a "carve-out". An auction and sale hearing
is contemplated to be held in March.
Judge Mary F. Walrath oversees the Debtors' cases. International
Media Group tapped Houlihan Lokey Capital, Inc., in October to
market the assets. Houlihan will continue marketing the assets
post-petition. William E. Chipman, Jr., Esq., and Mark D.
Olivere, Esq., at Cousins Chipman & Brown, LLC, in Wilmington,
Delaware, serve as the Debtors' bankruptcy counsel. The Debtors'
claims agent is Epiq Bankruptcy Solutions LLC.
In its schedules, International Media Group disclosed $206,825,047
in total assets and $233,218,073 in total liabilities.
LANDMARK INVESTORS: Court OKs Raymond Aver as Insolvency Counsel
----------------------------------------------------------------
Landmark Investors 2 LLC and Landmark Investors 7 LLC sought and
obtained permission from the U.S. Bankruptcy Court to employ the
Law Offices of Raymond H. Aver, A Professional Corporation, as
General Insolvency Counsel.
Glendora, Calif.-based Landmark Investors 2, LLC and Landmark
Investors 7, LLC, filed for Chapter 11 relief (Bankr. C.D. Calif.
Case No. 12-10321 and 12-10329) on Jan. 4, 2012. Judge Barry
Russell presides over the bankruptcy cases. Raymond H. Aver,
Esq., at the Law Offices of Raymond H. Aver APC, in Los Angeles,
represents the Debtors. In its petition, Landmark Investors 2
estimated assets and debts of $10 million to $50 million each.
The petitions were signed by Robert W. Bodkin, II, manager.
LEHMAN BROTHERS: Seeks Disallowance of $25MM Highbridge Claim
-------------------------------------------------------------
Lehman Brothers Holdings Inc. and the Official Committee of
Unsecured Creditors filed court papers seeking disallowance of
Highbridge International LLC's new claim.
Highbridge filed Claim No. 67911, which amended Claim No. 66459,
to recover as much as $25 million from Lehman on account of claims
that were released pursuant to a February 15 agreement. The
agreement settled a $710 million claim of about 70 investment
funds advised by JPMorgan Chase Bank N.A.
Lehman's lawyer argues that a portion of Claim No. 66459,
including a $42.8 million claim against the company, was
disallowed pursuant to the settlement.
When Lehman entered into the settlement agreement, the company
"believed that [it] would no longer have any liability on account
of the $42.8 million in claims," said L.P. Harrison 3rd, Esq., at
Curtis Mallet-Prevost Colt & Mosle LLP, in New York.
A court hearing to consider approval of the request is scheduled
for April 26. Objections are due by April 23.
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.
Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset
LLC sought for bankruptcy protection in December 2009.
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 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.
Lehman emerged from bankruptcy protection on March 6, 2012, more
than three years after it filed the largest bankruptcy in U.S.
history. Lehman is set to make its first payment to creditors
under its $65 billion payout plan on April 17, 2012.
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.
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: LBF Fight Affecting Swiss Financial Practices
--------------------------------------------------------------
Robert Shapiro, a former undersecretary for the U.S. Department
of Commerce, said the fight between Lehman Brothers Holdings,
Inc., and its former Swiss derivatives subsidiary over
intercompany loans and guarantees threatens Switzerland's "unique"
brand of finance, Patrick Fitzgerald of The Wall Street
Journal reported on March 7.
Lehman Brothers Finance AG, the Swiss subsidiary, claims LBHI
owes it $15.4 billion. LBHI, on the other hand, asserts that the
Swiss subsidiary owes it $14.2 billion and that the two claims
should be "set off." The Journal related that LBF's insolvency
administrators, PricewaterhouseCoopers, say that under Swiss law,
loans a parent makes to a subsidiary that then fails can be
converted into equity.
According to the Journal, Mr. Shapiro told a conference on
bankruptcy and bailout in Geneva that the failure of the Swiss
Financial Market Supervisory Authority, or FINMA, and LBF to
resolve LBF's debts and claims, has become subject of concern and
debate in Switzerland and in financial and legal circles around
the world.
Mr. Shapiro added, "[t]the international reputation of Swiss
banking and financial services has suffered in recent years,
mainly over issues in which Swiss banking law and practices have
been at odds with the law and practices of other advanced
nations. In this context, continued delay by FINMA and LBF to
resolve their part of the Lehman Brothers bankruptcy could
undermine Switzerland's unique brand in global finance. Such
damage would be felt by Swiss workers and affect Swiss GDP. By
every available measure and precedent, it is imperative that
FINMA and LBF promptly resolve their issues in the Lehman
Brothers bankruptcy."
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.
Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset
LLC sought for bankruptcy protection in December 2009.
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 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.
Lehman emerged from bankruptcy protection on March 6, 2012, more
than three years after it filed the largest bankruptcy in U.S.
history. Lehman is set to make its first payment to creditors
under its $65 billion payout plan on April 17, 2012.
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.
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: NC Says BNY Broke Deal With $95-Mil. Buy
---------------------------------------------------------
North Carolina's treasurer sued Bank of New York Mellon Corp. for
allegedly breaching an investment deal with the state's pension
funds by investing $95 million in Lehman Brothers Holdings Inc.,
according to a March 15 report by Law360.
The lawsuit claims that BNY Mellon invested the pension funds'
money in Lehman securities that did not meet the minimum
requirements of an investment agreement between the bank and the
state, Law360 reported.
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.
Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset
LLC sought for bankruptcy protection in December 2009.
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 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.
Lehman emerged from bankruptcy protection on March 6, 2012, more
than three years after it filed the largest bankruptcy in U.S.
history. Lehman is set to make its first payment to creditors
under its $65 billion payout plan on April 17, 2012.
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.
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: Principal Life Cancels Set-Off Motion
------------------------------------------------------
Principal Life Insurance Co. dropped its motion to lift the
automatic stay that was applied to the bankruptcy case of Lehman
Brothers Holdings Inc.'s special financing unit.
Principal Life had sought relief from the automatic stay so that
it could set off more than $13.6 million it owes to the Lehman
unit against the company's debt to the insurance firm.
The insurance firm's claim stemmed from an agreement connected
with the issuance of commercial paper notes by a special purpose
entity sponsored by Lehman's special financing unit. The
company's obligations under the deal were guaranteed by its
parent.
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.
Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset
LLC sought for bankruptcy protection in December 2009.
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 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.
Lehman emerged from bankruptcy protection on March 6, 2012, more
than three years after it filed the largest bankruptcy in U.S.
history. Lehman is set to make its first payment to creditors
under its $65 billion payout plan on April 17, 2012.
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.
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)
LI-ON MOTORS: Incurs $2.1 Million Net Loss in Jan. 31 Quarter
-------------------------------------------------------------
Li-on Motors filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $2.11 million on $641,878 of total revenue for the three months
ended Jan. 31, 2012, compared with a net loss of $989,260 on
$127,486 of total revenue for the same period during the prior
year.
The Company reported a net loss of $2.39 million on $814,196 of
total revenue for the six months ended Jan. 31, 2102, compared
with net income of $576,300 on $254,500 of total revenue for the
same period a year ago.
The Company's balance sheet at Jan. 31, 2012, showed $2.11 million
in total assets, $4.44 million in total liabilities and a $2.33
million total stockholders' deficit.
The Company does not currently have any arrangements for financing
and it may not be able to find such financing if required.
Obtaining additional financing would be subject to a number of
factors, including investor sentiment. Market factors may make
the timing, amount, terms or conditions of additional financing
unavailable to it. These uncertainties raise substantial doubt
about the ability of the Company to continue as a going concern.
Madsen & Associates, CPA's Inc., Murray, Utah, expressed
substantial doubt about Li-on Motors' ability to continue as a
going concern. The independent auditors noted that the Company
did not have any revenue from vehicle sales in 2011, does not have
cash flows to support its current operations and needs reserve to
cover expenses in future periods as the Company continues to incur
losses from operations.
A copy of the Form 10-Q is available for free at:
http://is.gd/Ve5TsO
About Li-On Motors
Las Vegas, Nev.-based Li-ion Motors Corp. was incorporated under
the laws of the State of Nevada in April 2000. The Company is
currently pursuing the development and marketing of electric
powered vehicles and products based on the advanced lithium
battery technology it has developed.
The Progressive Insurance Automotive X-Prize, competition was
announced in April 2008 as a way to spur the development of clean,
high-mileage vehicles, and is funded for a total of $10 million,
which will be divided among three separate categories. The
Company was the winner in its entry class. On Oct. 27, 2010, the
Company received net proceeds of approximately $2.30 million from
X-Prize and was recorded as other income in the Company's
consolidated statement of operations for the year ended July 31,
2011.
LIGHTSQUARED INC: Bank Debt Trades at 57% Off in Secondary Market
-----------------------------------------------------------------
Participations in a syndicated loan under which LightSquared Inc.
is a borrower traded in the secondary market at 42.80 cents-on-
the-dollar during the week ended Friday, March 23, 2012, an
increase of 0.48 percentage points from the previous week
according to data compiled by Loan Pricing Corp. and reported in
The Wall Street Journal. The Company pays 1200 basis points above
LIBOR to borrow under the facility. The bank loan matures on Oct.
1, 2014. The loan is one of the biggest gainers and losers among
192 widely quoted syndicated loans with five or more bids in
secondary trading for the week ended Friday.
About LightSquared Inc.
LightSquared Inc. -- http://www.lightsquared.com/-- operates an
open wireless broadband network company.
In February 2012, LightSquared's chief executive and an executive
vice president stepped down in the wake of a regulatory setback
that has forced the wireless venture to rethink its multibillion-
dollar strategy to roll out a new fourth-generation network.
The Federal Communications Commission said it would revoke a
waiver that would allow the company to use satellite airwaves for
a terrestrial network, citing concerns the network may interfere
with Global Positioning System signals. The company received the
conditional FCC waiver last year and hoped to compete with AT&T
Inc., Verizon Wireless and others in selling wireless airwaves, or
spectrum, wholesale to wireless carriers.
Reuters reported in February that hedge fund manager Philip
Falcone is ruling out a bankruptcy filing for LightSquared even as
sources familiar with the matter said the company was seeking
restructuring advice. Reuters also reported that two people
familiar with the matter said LightSquared has already hired
investment bank Moelis & Co. as a restructuring advisor.
LOCATION BASED TECH: Has At Least $500K Funding from Investor
-------------------------------------------------------------
Location Based Technologies, Inc., entered into a Securities
Purchase Agreement with an accredited investor pursuant to which
the Company issued a promissory note and common stock warrants to
the Investor and the Company received $500,000 in cash from the
Investor.
Under the terms of the Note the Company will receive a loan of up
to $2,000,000 but no less than $500,000. The total loan amount
will be based solely on Investor's discretion. The Note is
unsecured and has a term of 6 months. The loan can be converted
into equity at the end of the term only if the principal and
interest are not repaid. The loan can also be converted into
equity prior to the end of the loan term if the Company defaults
by violating a covenant. The number of shares issued upon
conversion will be the conversion amount divided by the conversion
price. The Note was issued at an original issue discount of 10%.
If the loan is repaid within the first 90 days, no additional
interest will be charged. If Company extends the loan beyond the
first 90 days, an additional 12% interest will be charged for the
next 90 days. There will be no further extensions beyond 180
days.
The Warrants permit the Investor to purchase 869,565 shares of
common stock at $0.23 per share. The Warrants will be exercisable
for 60 months and are subject to adjustment for stock splits,
dividends and similar recapitalization transactions and have
piggyback registration rights.
About Location Based Technologies
Headquartered in Irvine, Calif., Location Based Technologies, Inc.
(OTC BB: LBAS) -- http://www.locationbasedtech.com/-- designs,
develops, and sells personal, pet, and vehicle locator devices and
services.
Location Based Technologies reported a net loss of $8.22 million
on $16,969 of total net revenue for the year ended Aug. 31, 2011,
compared with a net loss of $9.06 million on $67,090 of total net
revenue during the prior year.
The Company's balance sheet at Aug. 31, 2011, showed $9.40 million
in total assets, $4.17 million in total liabilities, $685,500 in
commitments and contingencies and $4.53 million in total
stockholders' equity.
Comiskey & Company, in Denver Colorado, expressed substantial
doubt about the Company's ability to continue as a going concern
following the 2011 results. The independent auditors noted that
the Company has incurred recurring losses since inception and has
an accumulated deficit in excess of $37,000,000. There is no
established sales history for the Company's products, which are
new to the marketplace.
LOS ANGELES DODGERS: Three Bidders in Final Round
-------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the final round of bidding for the Los Angeles
Dodgers baseball club will probably begin March 27 or 28. Three
prospective buyers remain, according to two people with knowledge
of the sale process. The surviving bidders are Steve Cohen of SAC
Capital Advisors LP, St. Louis Rams football team owner Stan
Kroenke, and a group led by basketball Hall of Fame player Magic
Johnson, the people said. The last three bidders will seek
approval from the owners of the other major league clubs today,
March 27. The final round of bidding will take place when the
approvals come in or the next day.
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.
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.
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.
LOS GATOS HOTEL: Can Use Lender's Cash Until July 1
---------------------------------------------------
The Hon. Arthur S. Weissbrodt U.S. Bankruptcy Court for the
Northern District of California approved an agreement between the
Los Gatos Hotel Corporation and GCCFC 2006-GG7 Los Gatos Lodging
Limited Partnership, permitting the Debtor to use cash collateral
until July 1, 2012.
In 2006, the Debtor refinanced its debt on Hotel Los Gatos through
a loan from Greenwich Capital Financial Products, Inc., which was
evidenced by a promissory note in the amount of $12 million,
payable over a period of five years, and coming due in full in
March 2011. According to papers filed in court in December, the
Debtor said it was informed, but hasn't confirmed, that the Loan
was subsequently bundled with other loans and sold as part of a
commercial mortgage-backed security to Greenwich Capital
Commercial Funding Corp. GCCFC 2006-GG7 Los Gatos Lodging Limited
Partnership claims that it currently holds the Loan, which is
serviced by LNR Partners, LLC. As of the petition Date, the
principal balance of the Loan had been reduced to $11,606,981.
LNR has claimed that penalties and interest in arrears total
approximately $1.5 million.
The secured creditor is represented by Walter J. Greenhalgh, Esq.,
at Duane Morris LLP.
About Los Gatos Hotel
San Jose, California-based Los Gatos Hotel Corporation, dba Hotel
Los Gatos, was formed in 2000 to build and operate Hotel Los
Gatos, a full-service boutique hotel in downtown Los Gatos,
California.
Los Gatos Hotel filed for Chapter 11 bankruptcy protection on
December 27, 2010 (Bankr. N.D. Calif. Case No. 10-63135). The
Debtor disclosed $17,191,277 in assets and $12,896,468 in
liabilities as of the Chapter 11 filing. Affiliate Blossom Valley
Investors, Inc., filed a separate Chapter 11 petition (Bankr. N.D.
Calif. Case No. 09-57669) on Sept. 10, 2009.
Jeffry A. Davis, Esq., at Mintz Levin Cohn Ferris Glovsky Popeo,
serves as the Debtor's bankruptcy counsel. The Debtor has tapped
OSAS Inc. as financial advisor and investment banker.
LOS GATOS HOTEL: Plan Confirmation Hearing Set for April 20
-----------------------------------------------------------
The U.S. Bankruptcy Court approved on March 7, 2012, the revised
first amended disclosure statement explaining the Revised First
Amended Chapter 11 Plan of Reorganization of Los Gatos Hotel
Corporation, dba Hotel Los Gatos. The Debtor has begun soliciting
votes on the Amended Plan, dated Feb. 29, 2012.
Objections to confirmation of the Plan are due April 6, 2012.
Plan votes are due April 13.
On or before April 16, the Debtor and any parties objecting to the
confirmation of the Plan must submit a joint status conference
statement setting forth (a) the dates in May, June and July that
counsel for the Debtor and the objecting parties are available for
an evidentiary hearing, (b) the names of witnesses and expert
witnesses that the parties expect to call, (c) the proposed
discovery schedule, and (d) any motions in limine that the parties
expect to file.
A hearing on the confirmation of the Plan is set for April 20,
2012, at 2:15 p.m., unless an evidentiary hearing is required with
respect to any objections to the confirmation of the Plan, in
which case the Court will hold a status conference on the Hearing
Date at which it will set an evidentiary hearing.
Summary of Plan
The Plan proposes to pay the secured claim held by GCCFC 2006-GG7
Los Gatos Lodging Limited Partnership in full over time. The
claim, estimated at $13,047,014, is impaired and the lender is
entitled to vote on the Plan.
Priority Unsecured Claims (other than Priority Tax Claims),
estimated to be $88,495, will be paid in full. These claims
consist of gift certificates and customer deposits, which will be
honored upon presentation.
General Unsecured Claims, estimated at $197,975, will be paid over
a 24-month period, starting seven months after Plan becomes
effective. The unsecured creditors will also receive a 3%
interest. The claims are impaired and the general unsecured
creditors are entitled to vote on the Plan.
Unsecured Claims Held by the Debtor's insiders, estimated at
$7,121,666, will be paid in installments following payment of
other Allowed Claims. The holders of these claims may also vote
on the Plan.
The Plan will be funded by cash on hand as of the Effective Date
and the payments to be received by the Debtor from the operation
of the Hotel after the Effective Date, including rent paid by Dio
Deka, the restaurant in the Hotel. Dio Deka pays rent of $17,000
per month and also contributes to charges for common area
maintenance.
The Debtor prepared a pro forma estimated budget of revenues and
expenses through December 2016.
A copy of the first amended disclosure statement is available at:
http://bankrupt.com/misc/LOS_GATOS_ds_firstamended.pdf
About Los Gatos Hotel
San Jose, California-based Los Gatos Hotel Corporation, dba Hotel
Los Gatos, was formed in 2000 to build and operate Hotel Los
Gatos, a full-service boutique hotel in downtown Los Gatos,
California.
Los Gatos Hotel filed for Chapter 11 bankruptcy protection on
December 27, 2010 (Bankr. N.D. Calif. Case No. 10-63135). The
Debtor disclosed $17,191,277 in assets and $12,896,468 in
liabilities as of the Chapter 11 filing. Affiliate Blossom Valley
Investors, Inc., filed a separate Chapter 11 petition on September
10, 2009 (Bankr. N.D. Calif. Case No. 09-57669).
Jeffry A. Davis, Esq., at Mintz Levin Cohn Ferris Glovsky Popeo,
serves as the Debtor's bankruptcy counsel. The Debtor has tapped
OSAS Inc. as financial advisor and investment banker.
MCC HUMBLE: Court Won't Convert or Dismiss for Now
--------------------------------------------------
Bankruptcy Judge Letitia Z. Paul denied the request of Maaco
Franchising, Inc., to convert the case of MCC Humble Auto Paint,
Inc., to Chapter 7 pursuant to 11 U.S.C. Sec. 1112(b) or in the
alternative to dismiss the case, saying that evidence does not
support a finding of cause for conversion or dismissal at this
time.
Maaco asserts that a plan cannot be confirmed because its non-
compete agreement is enforceable and the Debtor cannot operate its
business due to the terms of the non-compete agreement. Maaco
also asserts that the Debtor is unable to effectuate a plan
because it has insufficient revenue. The Debtor does not dispute
that the covenant not to compete was part of the franchise
agreement, or that such a covenant is necessary to protect Maaco.
The Debtor disputes the adequacy of consideration and whether the
restrictions are reasonable.
The Court said it will revisit Maaco's contention that the Debtor
has insufficient revenue to fund a plan when assessing the
feasibility of the Debtor's plan.
On July 18, 2006, James M. Gaarder, president of the Debtor,
entered into a franchise agreement with Maaco Enterprises, Inc.,
to open a "Maaco Center," defined under the franchise agreement as
a center "specializing in vehicle painting and body repair," in
Humble, Texas. On Jan. 31, 2011, Maaco Franchising -- purporting
to be the entity with which the Debtor had a franchise agreement
-- gave notice to the Debtor and Mr. Gaarder that they were in
default in, inter alia, paying franchise fees due under the
franchise agreement. On March 11, 2011, Maaco sent to the Debtor
and Mr. Gaarder a notice of termination of the franchise
agreement.
A copy of the Court's March 21, 2012 Memorandum Opinion is
available at http://is.gd/moUT8Ofrom Leagle.com.
About MCC Humble Auto Paint
MCC Humble Auto Paint, Inc. -- aka MCC Humble Auto Paint and Maaco
Collision Repair and Auto Painting -- filed for Chapter 11
bankruptcy (Bankr. S.D. Texas Case No. 11-34994) on June 7, 2011,
listing under $1 million in assets and debts. A copy of the
Debtor's petition is available at no charge at
http://bankrupt.com/misc/txsb11-34994.pdf
MEDIA GENERAL: Incurs $74.3 Million Net Loss in Fiscal 2011
-----------------------------------------------------------
Media General, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss of
$74.32 million on $616.20 million of total revenues for the fiscal
year ended Dec. 25, 2011, a net loss of $22.64 million on
$678.11 million of total revenues for the fiscal year ended Dec.
26, 2010, and a net loss of $35.76 million on $657.61 million of
total revenues for the fiscal year ended Dec. 27, 2009.
The Company's balance sheet at Dec. 25, 2011, showed $1.08 billion
in total assets, $1.05 billion in total liabilities and $33.95
million in total stockholders' equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/rlACpr
About Media General
Richmond, Virginia-based Media General Inc. (NYSE: MEG) --
http://www.mediageneral.com/-- is an independent communications
company with interests in newspapers, television stations and
interactive media in the United States. The Company operates in
three business segments: Publishing, Broadcast and Interactive
Media. The Company owns 25 daily newspapers and more than 150
other publications, as well as 23 television stations. The
Company also operates more than 75 online enterprises. In March
2008, the Company completed the purchase of DealTaker.com, an
online social shopping portal.
* * *
As reported by the Troubled Company Reporter on October 5, 2011,
Moody's Investors Service downgraded Media General, Inc.'s (Media
General) Corporate Family Rating (CFR) and senior secured bond
rating to B3 from B2, and lowered the company's speculative-grade
liquidity rating to SGL-4 from SGL-3. The rating actions reflect
the liquidity pressure from the approaching March 2013 credit
facility maturity and heightened risk of a covenant violation, as
well as the operating pressure from a weaker advertising market.
The rating outlook is negative.
The TCR also reported on Oct. 28, 2011, that Standard & Poor's
Ratings Services lowered its corporate credit on Richmond, Va.-
headquartered Media General Inc. to 'CCC+' from 'B-'. "The
downgrade reflects our expectation that Media General could face
difficulties in maintaining covenant compliance in 2012," S&P
said.
METRO-GOLDWYN-MAYER: 2011 Revenues Up; Liguori Joins Board
----------------------------------------------------------
Alex Ben Block, writing for The Hollywood Reporter, says Metro
Goldwyn Mayer issued a revised financial statement for 2011
disclosing 2011 revenue of $699 million, which was up from $572.6
million in 2010.
According to the report, MGM also revealed that in November it
acquired full control of United Artists by buying outstanding debt
of some $140 million, apparently ending the reported 30% stake
that was held by Paula Wagner and Tom Cruise. The report says
that as part of that process, MGM gave up rights to the November
2012 release Red Dawn (which was distributed to creditors) but now
gets the distribution revenue from these four UA movies: Hot Tub
Time Machine, Fame, Valkyrie and Lions for Lambs. MGM might
resume using the UA banner to develop and produce new films.
MGM also disclosed that former Fox and Discovery Networks
executive Peter Liguori has joined the new MGM's board of
directors.
As part of its bankruptcy, MGM eliminated $5 billion in debt and
converted other debt into stock. In February 2012, MGM said its
lenders helped retire the old debt that was left and loaned the
studio $500 million in a revolving credit facility.
MICHAELS STORES: Reports $176 Million Net Income in Fiscal 2012
---------------------------------------------------------------
Michaels Stores, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing net income of
$176 million on $4.21 billion of net sales in 2011, compared with
net income of $103 million on $4.03 billion of net sales in 2010.
The Company's balance sheet at Jan. 28, 2012, showed $1.82 billion
in total assets, $4.29 billion in total liabilities, and a $2.47
billion total stockholders' deficit.
A copy of the Form 10-K is available for free at:
http://is.gd/o5TG3F
About Michaels Stores
Headquartered in Irving, Texas, Michaels Stores, Inc., is the
largest arts and crafts specialty retailer in North America. As
of March 9, 2009, the Company operated 1,105 "Michaels" retail
stores in the United States and Canada and 161 Aaron Brothers
Stores.
* * *
Michaels Stores carries a 'B3' corporate family rating from
Moody's Investors Service.
As reported by the Troubled Company Reporter on Oct. 8, 2010,
Moody's assigned Caa1 rating to Michaels Stores's proposed
$750 million senior unsecured bonds due 2018. Proceeds from the
note offering will be used to tender for an existing $750 million
series of unsecured notes. The refinancing, while improving the
maturity profile of the company, has no impact on Michaels'
current capital structure or ratings.
Moody's said Michaels' CFR reflects its significant financial
leverage and weak credit metrics. It also recognizes Michaels'
leadership position in the highly fragmented arts and crafts
segment, and its high operating margins. The rating takes into
consideration the company's participation in some segments that
have greater sensitivity to economic conditions, such as its
custom framing business. Michaels' ratings also reflect its good
liquidity with limited near term debt maturities.
MICROBILT CORP: Plan Solicitation Exclusivity Extended 60 Days
--------------------------------------------------------------
MicroBilt Corporation, et al., sought and obtained extension of
their exclusive right to solicit acceptances of a Plan of
Reorganization for a period of 60 days after the conclusion of the
hearing on the adequacy of the Debtors' disclosure statement.
On Dec. 15, 2011, the Debtors filed their Disclosure Statement and
Plan. The hearing on the adequacy of the Debtors' Disclosure
Statement was scheduled for March 8, 2012, but no ruling has been
made as of press time.
The Debtors sought extension of their Exclusive Solicitation
Period to permit its litigation with one of their main suppliers,
Chex Systems, Inc., to be completed. According to the Debtors,
the result of this litigation will have a substantial impact on
the terms of their Plan.
After the Petition Date, on April 5, 2011, Chex filed a motion for
an order compelling assumption or rejection of executory contract
with the Debtor and directing performance and payment of post-
petition amounts due thereunder. On April 21, 2011, the Debtors
filed their motion for authority to assume executory contract and
cure prepetition defaults.
About MicroBilt Corporation
MicroBilt Corporation in Princeton, New Jersey, and CL Verify LLC
in Tampa, Florida, offer small business owner solutions for fraud
prevention, consumer financing, debt collection, skip tracing and
background screening. MicroBilt provides access to over 3 billion
debit account records, nearly 30 billion pieces of demographic and
public record data and over 100 million unique consumer records to
prevent identity fraud, evaluate credit risk and retain customer
relationships.
MicroBilt and CL Verify filed for Chapter 11 five days apart:
MicroBilt (Bankr. D. N.J. Case No. 11-18143) on March 18, 2011,
and CL Verify (Bankr. D. N.J. Case No. 11-18715) on March 23,
2011. The Debtors tapped Lowenstein Sandler PC as their counsel,
and Maselli Warren, PC, as their special litigation counsel.
MicroBilt estimated $10 million to $50 million in both assets and
debts. CL Verify estimated $100 million to $500 million in
assets, but under $1 million in debts. Court papers say the
Debtors have roughly $8.4 million in unsecured debt and no secured
debt. The Debtors believe they have an enterprise value of
$150 million to $180 million.
No trustee, examiner or committee has been requested or appointed
in these Chapter 11 cases.
MICROBILT CORP: Taps Nagel Rice to Probe Claims vs. Law Firm
------------------------------------------------------------
The U.S. Bankruptcy Court for the District of New Jersey
authorized Microbilt Corporation, et al., to employ Nagel
Rice, LLP, as their special counsel. The firm may be requested
to:
(a) investigate and prosecute any legal malpractice claims
against a law firm previously retained by the Debtors;
(b) represent the Debtors in connection with litigation
commenced in the United States District Court for the
Middle District of Florida captioned Chex Systems, Inc. v.
DP Bureau, LLC, Case No. 8:10-cv-02465-T-33MAP;
(c) pursue any other claims against Chex Systems, Inc., and its
attorneys;
(d) assist the Debtors with such other litigation as the
Debtors may require services for; and
(e) perform additional services as the Debtors may request
from time to time.
The principal attorneys and paralegals responsible for the
representation of the Debtors and their current hourly rates are:
Bruce H. Nagel, Partner $750
Robert H. Solomon, Partner $575
Greg M. Kohn, Associate $450
About MicroBilt Corporation
MicroBilt Corporation in Princeton, New Jersey, and CL Verify LLC
in Tampa, Florida, offer small business owner solutions for fraud
prevention, consumer financing, debt collection, skip tracing and
background screening. MicroBilt provides access to over 3 billion
debit account records, nearly 30 billion pieces of demographic and
public record data and over 100 million unique consumer records to
prevent identity fraud, evaluate credit risk and retain customer
relationships.
MicroBilt and CL Verify filed for Chapter 11 five days apart:
MicroBilt (Bankr. D. N.J. Case No. 11-18143) on March 18, 2011,
and CL Verify (Bankr. D. N.J. Case No. 11-18715) on March 23,
2011. The Debtors tapped Lowenstein Sandler PC as their counsel,
and Maselli Warren, PC, as their special litigation counsel.
MicroBilt estimated $10 million to $50 million in both assets and
debts. CL Verify estimated $100 million to $500 million in
assets, but under $1 million in debts. Court papers say the
Debtors have roughly $8.4 million in unsecured debt and no secured
debt. The Debtors believe they have an enterprise value of
$150 million to $180 million.
No trustee, examiner or committee has been requested or appointed
in the Chapter 11 cases.
MONEYGRAM INT'L: Names Carl-Olav Scheible EVP Europe, Africa
------------------------------------------------------------
MoneyGram International has named Carl-Olav Scheible executive
vice president, Europe, Africa and Emerging Channels, effective
April 16, 2012.
"We are extremely pleased to welcome Carl to our senior management
team," said MoneyGram Chairman and CEO Pamela H. Patsley. "He is
a proven leader who brings a wealth of experience and a deep
understanding of the dynamics that drive the global payments
markets. His expertise in payment services, online commerce and
international business will be a tremendous asset as we work to
expand our presence across borders and into new channels."
In his role, Scheible will be responsible for overseeing and
growing MoneyGram's business in Europe and Africa. He also will
have global responsibility for the Company's expansion
opportunities online and through the formation of strategic global
partnerships. Scheible will be based in London and will report
directly to Patsley.
Scheible said, "MoneyGram has a strong portfolio of innovative
products and solutions, a talented employee base and an
outstanding global management team. I am pleased to be joining a
company with such a solid foundation and exciting growth
prospects, and look forward to helping MoneyGram further diversify
its customer base and strengthen its global brand."
For the last eight years, Scheible has held a variety of
leadership positions at PayPal, most recently serving as Managing
Director for the UK. During his tenure there, he successfully
rebuilt the UK unit's management team, substantially accelerated
growth rates, oversaw major marketing initiatives and launched
several award-winning new products. Scheible previously served as
an investment manager with b-bp/Investor, a European tech fund,
and before that was Head of Operations with Smarterwork, a London-
based Internet startup. He also served as Vice President at
American Express from 1998 to 2000, and started his career with
The Boston Consulting Group in Brussels. Scheible holds a B.A. in
Political Science and International Relations from Michigan State
University and a M.B.A. from Columbia Business School.
About MoneyGram International
MoneyGram International, Inc. (NYSE: MGI) --
http://www.moneygram.com/-- is a leading global payment services
company. The Company's major products and services include global
money transfers, money orders and payment processing solutions for
financial institutions and retail customers. MoneyGram is a New
York Stock Exchange listed company with 203,000 global money
transfer agent locations in 191 countries and territories.
The Company's balance sheet at Dec. 31, 2011, showed $5.17 billion
in total assets, $5.28 billion in total liabilities, and a
$110.19 million total stockholders' deficit.
* * *
According to the Troubled Company Reporter on July 1, 2010, Fitch
Ratings has affirmed the Issuer Default Ratings for MoneyGram
International Inc. and MoneyGram Payment Systems Worldwide, Inc.,
at 'B+'. Outlook is stable. Fitch noted that the ratings could
be negatively impacted by further declines in remittance volumes
driven by macro economic factors or decreases in migrant labor
populations worldwide.
MONEYGRAM INT'L: Appoints Alex Holmes as Chief Financial Officer
----------------------------------------------------------------
MoneyGram International named Alexander "Alex" Holmes as executive
vice president and chief financial officer, effective immediately.
Holmes succeeds James E. Shields, who has served as MoneyGram's
executive vice president and chief financial officer since July
2010. To ensure a smooth transition, Shields will remain with the
Company through May 15, 2012.
Having served most recently as MoneyGram's senior vice president
for corporate strategy and investor relations, Holmes brings
extensive and detailed knowledge of the Company's business
operations, partnership activities and growth objectives. In his
new role, he is responsible for oversight of all finance-related
functions, close collaboration with the Company's business unit
leaders, and the continued development and expansion of
MoneyGram's involvement with the investor community.
"This appointment is another important step in our ongoing efforts
to establish MoneyGram as an industry leader with a strong global
brand and an enhanced public presence," said Pamela H. Patsley,
MoneyGram's chairman and chief executive officer. "As his superb
performance over the past three years has shown, Alex has the
insight, expertise and drive required to oversee MoneyGram's
financial activities, which are integral to MoneyGram's success.
I am confident that his strategic talents and keen grasp of our
business will be beneficial as MoneyGram builds on the momentum of
our recent growth initiatives and delivers long-term value
creation. We appreciate Jim Shields' many contributions to
MoneyGram's transformation over the past two years and wish him
well in his future endeavors."
Patsley continued, "Over the past several months, we have deepened
our existing bench of executive talent to establish a team with
the core competencies necessary to drive increased growth and
shareholder value. MoneyGram has already realized significant
benefits in the global finance organization from the recent
additions of David B. Brown as senior vice president and chief
accounting officer and Larry Angelilli as senior vice president
and treasurer. We see Alex's appointment as further strengthening
MoneyGram's leadership in this area."
Before joining MoneyGram in 2009, Holmes held a variety of
financial positions over an eight-year period at First Data
Corporation, most recently serving as senior vice president of
Global Sourcing and Strategic Initiatives. From 2002 to 2003, he
managed Western Union's Benelux region from its offices in
Amsterdam. He holds a Bachelor of Science in Business
Administration and Accounting and Master of Science in Information
Technology, both from the University of Colorado.
"Leading MoneyGram's global finance organization is an exciting
opportunity," Holmes said. "As a leadership team, we've
implemented new strategies and made changes throughout the Company
that have put us in a more competitive position. Our finance
organization is strong and I look forward to building on the
momentum that has carried over from 2011."
The Company also announced that it had strong money transfer
transaction growth in January and February of 2012 and that for
fiscal year 2012, management continues to estimate total revenue
growth of 7 to 9 percent and adjusted EBITDA growth of 9 to 11
percent consistent with its long-term management targets, as
previously announced by the Company in February 2012.
About MoneyGram International
MoneyGram International, Inc. (NYSE: MGI) --
http://www.moneygram.com/-- is a leading global payment services
company. The Company's major products and services include global
money transfers, money orders and payment processing solutions for
financial institutions and retail customers. MoneyGram is a New
York Stock Exchange listed company with 203,000 global money
transfer agent locations in 191 countries and territories.
The Company's balance sheet at Dec. 31, 2011, showed $5.17 billion
in total assets, $5.28 billion in total liabilities, and a
$110.19 million total stockholders' deficit.
* * *
According to the Troubled Company Reporter on July 1, 2010, Fitch
Ratings has affirmed the Issuer Default Ratings for MoneyGram
International Inc. and MoneyGram Payment Systems Worldwide, Inc.,
at 'B+'. Outlook is stable. Fitch noted that the ratings could
be negatively impacted by further declines in remittance volumes
driven by macro economic factors or decreases in migrant labor
populations worldwide.
NEBRASKA BOOK: Given Approval for Severance Program
---------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Nebraska Book Co. was given the bankruptcy court's
approval for a severance program for non-officer employees
designed to allay the workers' fears given how the bookseller to
college students has been in reorganization much longer than
anticipated. The company can spend as much as $223,000 on
severance payments representing as much as three months' pay. The
minimum severance award is two weeks' pay.
About Nebraska Book
Lincoln, Nebraska-based Nebraska Book Company, Inc., is one of the
leading providers of new and used textbooks for college students
in the United States. Nebraska Book and seven affiliates filed
separate Chapter 11 petitions (Bankr. D. Del. Case Nos. 11-12002
to 11-12009) on June 27, 2011. Hon. Peter J. Walsh presides over
the case. Lawyers at Kirkland & Ellis LLP and Pachulski Stang
Ziehl & Jones LLP, serve as the Debtors' bankruptcy counsel. The
Debtors; restructuring advisors are AlixPartners LLC; the
investment bankers are Rothschild, Inc.; the auditors are Deloitte
& Touche LLP; and the claims agent is Kurtzman Carson Consultants
LLC. As of the Petition Date, the Debtors had consolidated assets
of $657,215,757 and debts of $563,973,688.
JPMorgan Chase Bank N.A., as administrative agent for the DIP
lenders, is represented by lawyers at Richards, Layton & Finger,
P.A., and Simpson Thacher & Bartlett LLP. J.P. Morgan Investment
Management Inc., the DIP arranger, is represented by lawyers at
Bayard, P.A., and Willkie Farr & Gallagher LLP.
An ad hoc committee of holders of more than 50% of the Debtors'
Second Lien Notes is represented by lawyers at Brown Rudnick. An
ad hoc committee of holders of the Debtors' 8.625% unsecured
notes are represented by Milbank, Tweed, Hadley & McCloy LLP.
The Official Committee of Unsecured Creditors selected Lowenstein
Sandler LLP and Stevens & Lee, P.C., as lawyers and Mesirow
Financial Inc. as financial advisers.
Nebraska Book was unable to confirm a pre-packaged Chapter 11
plan that would have swapped some of the existing debt for new
debt, cash and the new stock, due to an inability to secure
$250 million in exit financing.
In March 2012, Nebraska Book filed a revised Chapter 11
reorganization plan that offers the new stock plus a new
$100 million second-lien note to holders of the existing
$200 million in second-lien debt. The projected recovery is 81%
on the second-lien notes.
NEOMEDIA TECHNOLOGIES: Global Grid Discloses 25.9% Equity Stake
---------------------------------------------------------------
Global Grid, LLC, and Dr. Patrick Soon-Shiong disclosed in a
Schedule 13D filed with the U.S. Securities and Exchange
Commission that, as of March 15, 2012, they beneficially own
113,494,743 shares of common stock of Neomedia Technologies, Inc.,
representing 25.9% of the shares outstanding.
Between March 14, 2012 and March 16, 2012, Global Grid purchased
an aggregate of 113,494,743 shares of Common Stock on the open
market at an aggregate purchase price of $3,658,274.
A copy of the filing is available for free at:
http://is.gd/FP1jSO
About NeoMedia Technologies
Atlanta, Ga.-based NeoMedia Technologies, Inc., provides mobile
barcode scanning solutions. The Company's technology allows
mobile devices with cameras to read 1D and 2D barcodes and provide
"one click" access to mobile content.
The Company has historically incurred net losses from operations
and expects it will continue to have negative cash flows as it
implements its business plan. The Company said there can be no
assurance that its continuing efforts to execute its business plan
will be successful and that it will be able to continue as a going
concern.
The Company's balance sheet at Sept. 30, 2011, showed $8.02
million in total assets, $65.98 million in total liabilities, all
current, $5.43 million in Series C convertible preferred stock,
$2.36 million in Series D convertible preferred stock, and a
$65.75 million total shareholders' deficit.
Kingery & Crouse, P.A, in Tampa, Fla., expressed substantial doubt
about the Company's ability to continue as a going concern. The
accounting firm noted that the Company has suffered recurring
losses from operations and has ongoing requirements for additional
capital investment.
NEUROLOGIX INC: George Miller Named Bankruptcy Trustee
------------------------------------------------------
Neurologix, Inc., filed a voluntary petition under Chapter 7 of
the United States Bankruptcy Code in the United States Bankruptcy
Court, District of Delaware. The case is being administered under
the caption "In re: Neurologix, Inc.," case number 12-10936-CSS.
Pleadings filed in the bankruptcy case can be accessed through
Pacer at the Delaware Bankruptcy Court's Web site,
www.deb.uscourts.gov, by clicking on the link to CM/ECF.
On March 19, 2012, the case was assigned to Judge Christopher
Sontchi of the United States Bankruptcy Court, District of
Delaware, and George L. Miller was named the bankruptcy trustee,
in whom control of all assets of the Company is now vested.
About Neurologix, Inc.
Fort Lee, N.J.-based Neurologix, Inc. (OTC Bulletin Board: NRGX)
-- http://www.neurologix.net/-- is a clinical-stage biotechnology
company dedicated to the discovery, development, and
commercialization of gene transfer therapies for serious disorders
of the brain and the central nervous system. The Company's
current programs address such conditions as Parkinson's disease,
epilepsy, depression and Huntington's disease, all of which are
large markets not adequately served by current therapeutic
options.
The Company reported a net loss of $10.16 million on $0 of revenue
for the year ended Dec. 31, 2010, compared with a net loss of
$13.46 million on $0 of revenue during the prior year.
The Company's balance sheet at June 30, 2011, showed $4.96 million
in total assets, $13.62 million in total liabilities, and a
$8.66 million total stockholders' deficit.
BDO USA, LLP, in New York, raised substantial doubt about the
Company's ability to continue as a going concern. BDO noted that
the Company has suffered recurring losses from operations, expects
to incur future losses for the foreseeable future and has
deficiencies in working capital and capital.
NUVILEX INC: Incurs $272,000 Net Loss in Jan. 31 Quarter
--------------------------------------------------------
Nuvilex, Inc., filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $271,777 on $20,271 of total revenue for the three months ended
Jan. 31, 2012, compared with a net loss of $124,101 on $32,022 of
total revenue for the same period during the prior year.
The Company reported a net loss of $1.39 million on $59,877 of
total revenue for the nine months ended Jan. 31, 2012, compared
with a net loss of $304,180 on $74,851 of total revenue for the
same period during the prior year.
The Company's balance sheet at Jan. 31, 2012, showed $1.86 million
in total assets, $3.53 million in total liabilities, $580,000 in
preferred stock, and a $2.25 million total stockholders' deficit.
In addition, as of Jan. 31, 2012, the Company had an accumulated
deficit of $39,343,642 since inception in 2001, had incurred a net
loss for the nine months ended Jan. 31, 2012, of $1,394,949, and
had negative working capital of $2,779,376. Funding for continued
operation has been provided by various generous investors which
have primarily enabled continuance of Nuvilex to date. The
Company's current business plan requires additional funding beyond
its anticipated cash flows from present operations, some of which
may have to cease if sufficient funding is not acquired shortly.
Nonetheless, these and other factors raise substantial doubt about
the Company's ability to continue as a going concern.
M&K CPAS, PLLC, in Houston, Texas, expressed substantial doubt
about Nuvilex's ability to continue as a going concern, following
the Company's results for the fiscal year ended April 30, 2011.
The independent auditors noted that the Company has suffered
recurring losses from operations.
A copy of the Form 10-Q is available for free at:
http://is.gd/0j2xuJ
About Nuvilex Inc.
Silver Spring, Md.-based Nuvilex, Inc., Nuvilex, Inc. operates
independently and through wholly-owned subsidiaries. The Company
is dedicated to bringing to market scientifically derived products
designed to improve the health and well-being of those who use
them. The Company's current strategy is to focus on developing
and marketing products in the biotechnology arena it believes have
potential for long-term corporate growth.
PHILIP LIVELY: 5th Cir. to Review BACPA Rule for Individual Cases
-----------------------------------------------------------------
Bankruptcy Judge Marvin Isgur certified his Order denying
confirmation of Philip Reed Lively's chapter 11 plan to the Court
of Appeals for the Fifth Circuit under 28 U.S.C. Sec.
158(d)(1)(A)(i) and (ii). Judge Isgur issued a Memorandum Opinion
dated March 21, 2012, available at http://is.gd/7BD1HDfrom
Leagle.com, in support of that certification. The issue is
whether the Bankruptcy Abuse and Consumer Protection Act of 2005
abrogated the absolute priority rule in individual Chapter 11
cases.
Philip Reed Lively initially filed a Chapter 13 bankruptcy
petition. The case was converted to a Chapter 11 Bankr. S.D. Tex.
Case No. 10-35471).
Mr. Lively filed his Amended Chapter 11 plan on Aug. 19, 2011. At
the confirmation hearing, the Court preliminarily announced that
it would deny confirmation of the plan for violating the absolute
priority rule under 11 U.S.C. Sec. 1129(b)(2)(B)(ii). The Court
allowed briefing on the question of whether BAPCPA abrogated the
absolute priority rule for individual chapter 11 cases. Mr.
Lively filed a brief in support of his argument that it did.
Having considered the brief and applicable law, the Court denied
confirmation.
Mr. Lively's proposed plan was not approved by all classes of
claims entitled to vote on the plan. The plan provided for a
forecasted 7.38% payment to his unsecured creditors on their
claims.
According to Judge Isgur, the BACPA altered the language of Sec.
1129(b)(2)(B)(ii). These changes have created a split of opinion
among courts as to whether the "absolute priority rule" still
applies to individual chapter 11 plans.
At confirmation, the Court held that BAPCPA did not abrogate the
absolute priority rule for individual Chapter 11 cases. As the
proposed plan allowed Mr. Lively to retain property under the plan
on account of his prior interests, but failed to pay unsecured
creditors in full, the Court denied confirmation of the plan.
Mr. Lively appealed the decision and seeks direct certification to
the Fifth Circuit Court of Appeals.
PINNACLE FOODS: Moody's Rates $550-Mil. Credit Facilities 'Ba3'
---------------------------------------------------------------
Moody's Investors Service assigned a Ba3 rating to $550 million of
new senior secured credit facilities being offered by Pinnacle
Foods Finance LLC, consisting of a five-year $150 million
revolving credit facility due 2017 and a seven-year $400 million
term loan ("Term Loan E") due 2019. Moody's also assigned a Ba3 to
up to $1.2 billion of existing senior secured term debt ("Term
Loan B") that the company is offering to extend to a maturity date
of October 2016 from April 2014. Moody's affirmed the company's
Corporate Family Rating and Probability of Default Rating at B2.
The rating outlook is stable.
As part of the proposed transaction, Pinnacle plans to use a
portion of cash balances ($151 million as of December 25, 2011)
and proceeds from the new $400 million Term Loan E to retire all
$199 million of its 10.625% senior subordinated debt due 2017 and
the $313 million remaining under an existing senior secured term
loan ("Term Loan D") due 2014. The resulting shift toward a more
secured debt structure will place downward rating pressure on the
remaining senior unsecured debt, which will become the most
structurally subordinated debt in the capital structure. As a
result, Moody's has downgraded the ratings on $1.025 billion of
existing senior unsecured debt to Caa1 from B3 in anticipation of
the transaction closing under contemplated terms. The downgraded
securities consist of $625 million of 9.25% senior unsecured notes
due 2015 and $400 million of 8.25% senior unsecured notes due
2017. Moody's will withdraw the Caa1 rating on $199 million of
subordinated notes when they are retired.
The proposed transaction will result in a slight increase in the
company's current $2.6 billion of net funded debt, but the
extended debt maturities will be more manageable and the interest
cost savings is significant.
"Pinnacle should realize at least $25 million in annual interest
expense savings that could be used to fund additional brand
support or to pay down more debt," said Brian Weddington, a
Moody's Senior Credit Officer.
Rating Rationale
Pinnacle's B2 Corporate Family Rating reflects the high but
declining leverage that resulted from the company's $2.2 billion
debt-financed acquisition of Birds Eye Foods in late 2009 and the
strong brand equity of Birds Eye that has provided a platform for
improved innovation, stronger profit margins and greater scale
efficiencies in frozen foods. Additionally, the operating
performance of the shelf-stable portfolio should have meaningful
upside potential driven by increased brand support behind the
Duncan Hines brand and improved business mix.
Pinnacle Foods Finance LLC:
Ratings Assigned:
$150 million new Senior Secured Bank Revolving Credit Facility
due 2017 at Ba3, LGD3 - 31%;
$400 million new Senior Secured Term Loan E, due 2019 at Ba3,
LGD3 - 31%;
Up to $1,199 million extended-maturity Senior Secured Term Loan
B due 2016 at Ba3 LGD3 - 31%.
Ratings Downgraded:
$625 million of 9.25% Senior Unsecured Notes due April 2015 to
Caa1 from B3;
$400 million of 8.25% Senior Unsecured Notes due September 2017
to Caa1 from B3.
Ratings Affirmed:
Corporate Family Rating at B2;
Probability of Default Rating at B2;
$150 million Senior Secured Bank Revolving Credit Facility due
April 2013 at Ba3 (to be withdrawn);
$1,199 million Senior Secured Bank Term Loan B due April 2014 at
Ba3;
$313 million Senior Secured Bank Term Loan D due April 2014 at
Ba3 (to be withdrawn);
$199 million of 10.625% Senior Subordinated Notes due April 2017
at Caa1 (to be withdrawn).
LGD Rates To Be Revised:
LGD Senior Secured Bank Credit Facilities (Domestic) to LGD3 -
29% from LGD2- 28%;
LGD Senior Unsecured Debt (Domestic) to LGD5 - 83% from LGD5 -
77%.
SGL Rating Affirmed:
Speculative Grade Liquidity Rating at SGL-2.
Pinnacle has been able to partially offset inflation pressure on
gross margins through price increases, ongoing productivity
improvements and through exiting lower-margin private label and
food service businesses. The company also discontinued its
underperforming Birds Eye Steamfresh meals and U. S. Swanson meals
lines. The pace of debt reduction slowed last year due to
accelerated spending on cost-cutting projects including $29
million spent in incremental capital expenditures to consolidate
manufacturing plants, which the company expects will save $20
million in annual costs. Productivity initiatives and net price
realization improved EBITDA margins by over 200 basis points last
year to 18.5%, and Moody's expects EBITDA margins to remain above
18% in 2012 leading to a reduction in debt/EBITDA leverage to
below 6.0 times within 12-18 months.
An upgrade could occur if Moody's believes that Pinnacle is likely
to sustain debt to EBITDA below 5.5 times. Ratings could be
lowered if Pinnacle's debt to EBITDA rises above 7.0 times, if
free cash flow deteriorates materially, or if the company engages
in a major leveraged acquisition.
Corporate Profile
Headquartered in Mountain Lakes, New Jersey, Pinnacle Foods
Finance LLC, through its wholly-owned operating company, Pinnacle
Foods Group, manufactures and markets branded convenience food
products in the US and Canada. Its brands include Birds Eye,
Voila, Hungry-Man and Swanson frozen dinners, Vlasic pickles, Mrs.
Paul's and Van de Kamp's frozen prepared sea food, Aunt Jemima
frozen breakfasts, Log Cabin and Mrs. Butterworth's syrup and
Duncan Hines cake mixes. Annual net sales approximate $2.5
billion. Substantially all of the capital stock of Pinnacle Foods
Finance LLC is owned by investment funds associated with or
designated by The Blackstone Group.
The principal methodology used in rating Pinnacle Foods Finance
LLC was the Global Packaged Goods Industry Methodology, which can
be found at www.moodys.com in the Research & Ratings directory, in
the Ratings Methodologies subdirectory. Other methodologies and
factors that may have been considered in the process of rating
Pinnacle Foods Finance LLC can also be found in the Rating
Methodologies subdirectory.
PMI GROUP: Asks Court to Extend Plan Filing Deadline to May 21
--------------------------------------------------------------
The PMI Group, Inc., asks the U.S. Bankruptcy Court for the
District of Delaware to extend the Debtor's exclusive periods to
file a Chapter 11 plan to May 21, 2012, and to solicit acceptances
of that plan to July 20, 2012.
The Debtor says that its current exclusive filing period expired
on March 22, 2012 and that its current exclusive solicitation
period will expire on May 21, 2012. The Debtor said that it needs
the extension due to the size, complexity and duration of its
bankruptcy case.
The Debtor has been operating under Chapter 11 protection for less
than four months. The Debtor has worked to, among other things:
(i) negotiate, execute and obtain court approval of an amended
shared services agreement with its principal subsidiary, PMI
Mortgage Insurance Co., or MIC, pursuant to which MIC provides the
Debtor with certain accounting, auditing, legal, investment,
personnel and other administrative services, as well as the use
of certain of MIC's facilities, on a cost allocation basis;
(ii) negotiate and obtain entry of an order approving the
consensual resolution of the contested appointment of a receiver
in the receivership proceeding pending against MIC by the Arizona
Department of Insurance; (iii) address issues relative to the
ADI's supervision of the Debtor's principal regulated reinsurance
subsidiaries, PMI Reinsurance Co., PMI Mortgage Guaranty Co., and
Residential Insurance Co.
Since the Petition Date, the Debtor has focused the majority of
its time and resources negotiating and receiving approval of a
transition services agreement with MIC, negotiating the terms of
the appointment of the receiver, and discussing the preservation
of valuable tax attributes and NOLs with the Committee of
Unsecured Creditors and MIC. The Debtor also recently began
negotiating the framework, of a proposed Chapter 11 plan with the
Creditors' Committee. While the terms are still being vetted, the
Debtor anticipates finalizing the framework of the restructuring
in the near term and moving forward shortly thereafter with the
filing of a plan and disclosure statement.
The Debtor submits that the requested extension of the exclusive
periods will not prejudice the legitimate interests of
postpetition creditors, as the Debtor continues to make timely
payments on its undisputed postpetition obligations. The Debtor
says that termination of its exclusive periods would adversely
impact its efforts to preserve and maximize the value of the
estate and the progress of the bankruptcy case.
About PMI Group
Del.-based The PMI Group, Inc., is an insurance holding company
whose stock had, until Oct. 21, 2011, been publicly-traded on the
New York Stock Exchange. Through its principal regulated
subsidiary, PMI Mortgage Insurance Co., and its affiliated
companies, the Debtor provides residential mortgage insurance in
the United States.
The PMI Group filed for Chapter 11 bankruptcy (Bankr. D. Del. Case
No. 11-13730) on Nov. 23, 2011. In its schedules, the Debtor
disclosed $167,963,354 in assets and $770,362,195 in liabilities.
Stephen Smith signed the petition as chairman, chief executive
officer, president and chief operating officer.
The Debtor said in the filing that it does not have the financial
resources to pay the outstanding principal amount of the 4.50%
Convertible Senior Notes, 6.000% Senior Notes and the 6.625%
Senior Notes if those amounts were to become due and payable.
The Debtor is represented by James L. Patton, Esq., Pauline K.
Morgan, Esq., Kara Hammond Coyle, Esq., and Joseph M. Barry, Esq.,
at Young Conaway Stargatt & Taylor LLP.
PREMIER BANK: Closed; Int'l Bank of Chicago Assumes All Deposits
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Premier Bank of Wilmette, Ill., was closed Friday, March 23, 2012,
by the Illinois Department of Financial and Professional
Regulation ? Division of Banking, which appointed the Federal
Deposit Insurance Corporation as receiver. To protect the
depositors, the FDIC entered into a purchase and assumption
agreement with International Bank of Chicago of Chicago, Ill., to
assume all of the deposits of Premier Bank.
The two branches of Premier Bank will reopen during their normal
business hours as branches of International Bank of Chicago.
Depositors of Premier Bank will automatically become depositors of
International Bank of Chicago. Deposits will continue to be
insured by the FDIC, so there is no need for customers to change
their banking relationship in order to retain their deposit
insurance coverage up to applicable limits. Customers of Premier
Bank should continue to use their existing branch until they
receive notice from International Bank of Chicago that it has
completed systems changes to allow other International Bank of
Chicago branches to process their accounts as well.
As of December 31, 2011, Premier Bank had approximately $268.7
million in total assets and $199.0 million in total deposits. In
addition to assuming all of the deposits of the failed bank,
International Bank of Chicago agreed to purchase essentially all
of the assets.
Customers with questions about the transaction should call the
FDIC toll-free at 1-800-591-2767. Interested parties also can
visit the FDIC's Web site at
http://www.fdic.gov/bank/individual/failed/premier-il.html
The FDIC estimates that the cost to the Deposit Insurance Fund
will be $64.1 million. Compared to other alternatives,
International Bank of Chicago's acquisition was the least costly
resolution for the FDIC's DIF. Premier Bank is the fifteenth
FDIC-insured institution to fail in the nation this year, and the
third in Illinois. The last FDIC-insured institution closed in
the state was New City Bank, Chicago, on March 9, 2012.
PRIME HEALTHCARE: Moody's Issues Summary Credit Opinion
-------------------------------------------------------
Moody's Investors Service issued a summary credit opinion on Prime
Healtcare Services, Inc. and includes certain regulatory
disclosures regarding its ratings. The release does not constitute
any change in Moody's ratings or rating rationale for Prime
Healtcare Services, Inc.
Moody's current ratings on Prime Healthcare Services, Inc. are:
Long Term Corporate Family (foreign currency) rating of B2
Probability of Default rating of B2
Senior Secured Bank Credit Facility (domestic currency) ratings
of B1; LGD3 - 41
Ratings Rationale
Prime Healthcare's B2 rating reflects the risks associated with
the concentration of operations in Southern California and the
company's reliance on a few facilities for a considerable portion
of revenue and EBITDA. Additionally, the company generates over
60% of its revenue from government programs, including the Medi-
Cal program of economically challenged California. Furthermore,
while Moody's acknowledges in the rating the company's track
record of significantly improving acquired facilities, both in
terms of top line and margin performance, Moody's also considers
the risks associated with acquiring and integrating financially
distressed operations. However, the credit metrics are strong for
the rating category with modest leverage, strong interest expense
coverage and robust cash flow generation.
The stable outlook reflects Moody's expectation that the company's
current portfolio of hospitals will continue to realize modest
organic growth but any meaningful growth will be through
additional acquisitions. The outlook also reflects Moody's belief
that the acquisition activity, which is expected to primarily be
funded out of cash reserves and free cash flow, can be absorbed at
the current rating level.
The financial metrics are already strong for the rating category.
If the company is able to increase its scale and reduce
concentration through growth in its core operations and
diversification of revenue and profitability sources, geographic
presence and payor mix, Moody's could upgrade the rating. However,
Moody's would continue to expect to see credit metrics that are
strong for the rating category given the inherent risks associated
with a rapid growth strategy through the acquisition of troubled
operations.
If the company experiences a significant deterioration of credit
metrics, through a negative development in the California market
or a large debt financed acquisition, Moody's could downgrade the
rating. For example, if state budget issues force a significant
negative change in Medi-Cal reimbursement or if the payor mix
deteriorates significantly such that Moody's expected the change
to jeopardize cash flow, interest coverage, or future growth
prospects, Moody's could downgrade the ratings. Moody's could also
downgrade the ratings if the turn-around of the operations of
future acquisition targets was not successful or integration
problems arose that negatively impacted the operations of the
consolidated company.
The principal methodology used in rating Prime Healthcare
Services, Inc. was the Global Healthcare Service Providers
Industry Methodology published in December 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.
RADIO ONE: Incurs $14.4MM Consolidated Net Loss in Fourth Quarter
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Radio One, Inc., reported a consolidated net loss of $14.45
million on $98.09 million of net revenue for the three months
ended Dec. 31, 2011, compared with a net loss of $26.57 million
on $71.16 million of net revenue for the same period a year ago.
The Company reported consolidated net income of $15.37 million on
$364.61 million of net revenue for the year ended Dec. 31, 2011,
compared with consolidated net loss of $26.62 million on $279.72
million of net revenue during the prior year.
Alfred C. Liggins, III, Radio One's CEO and President stated, "Our
fourth quarter radio revenue was impacted by a combination of
tough political comps, non-recurring national accounts and certain
format changes that we effected during the quarter. Normalizing
for political and issue money, our underlying core radio revenue
was down approximately 4.2%. While this is disappointing, I
believe our radio group is poised to rebound strongly in 2012,
with mid to high single digit revenue growth in both the first and
second quarters. TV One continues its strong performance with
fourth quarter revenue growth of 8.7% and EBITDA growth of
approximately 102% compared to fourth quarter 2010. We expect TV
One's full year EBITDA to increase to approximately $40 million
for 2012. Before intercompany management charges, our internet
business generated positive adjusted EBITDA2 for the second
sequential quarter, and we expect that division to be cash-flow
positive for 2012."
A copy of the press release is available for free at:
http://is.gd/0mZYMV
About Radio One
Based in Washington, Radio One, Inc. (Nasdaq: ROIAK and ROIA) --
http://www.radio-one.com/-- is a diversified media company that
primarily targets African-American and urban consumers. The
Company is one of the nation's largest radio broadcasting
companies, currently owning 53 broadcast stations located in 16
urban markets in the United States. Radio One operates
syndicated programming including the Russ Parr Morning Show, the
Yolanda Adams Morning Show, the Rickey Smiley Morning Show, CoCo
Brother Live, CoCo Brother's 'spirit" program, Bishop T.D. Jakes'
"Empowering Moments", the Reverend Al Sharpton Show, and the
Warren Ballentine Show.
The Company also owns a controlling interest in Reach Media, Inc.
-- http://www.blackamericaweb.com/-- owner of the Tom Joyner
Morning Show and other businesses associated with Tom Joyner.
Radio One owns Interactive One -- http://www.interactiveone.com/
-- an online platform serving the African-American community
through social content, news, information, and entertainment,
which operates a number of branded sites, including News One,
UrbanDaily, HelloBeautiful, Community Connect Inc. --
http://www.communityconnect.com/-- an online social networking
company, which operates a number of branded Web sites, including
BlackPlanet, MiGente, and Asian Avenue and an interest in TV One,
LLC -- http://www.tvoneonline.com/-- a cable/satellite network
programming primarily to African-Americans.
In its report dated Aug. 23, 2010, for the Company's fiscal 2009
financial statements, Ernst & Young LLP expressed substantial
doubt as to the Company's ability to continue as a going concern,
given certain covenant violations under the Company's loan
agreements which could have resulted in significant portions of
the Company's outstanding debt becoming callable by the Company's
lenders. The Company noted that these violations were cured as a
part of certain refinancing transactions more fully described in
our Current Report on Form 8-K filed, Dec. 1, 2010. Having cured
these violations, the Company's audited financial statements for
2010 have been prepared assuming that it will continue as a going
concern.
The Company reported a net loss of $26.62 million on
$279.90 million of net revenue for the year ended Dec. 31, 2010,
compared with a net loss of $48.55 million on $272.09 million of
net revenue during the prior year.
The Company's balance sheet at Sept. 30, 2011, showed
$1.52 billion in total assets, $1.06 billion in total liabilities,
$29.71 million in redeemable noncontrolling interests, and
$421.79 million in total equity.
* * *
In the Dec. 10, 2010 edition of the TCR, Moody's confirmed the
Caa1 rating for Radio One, Inc.'s Corporate Family Rating and
confirmed its Caa2/LD Probability of Default Rating. According to
Moody's, the Caa1 corporate family rating will reflect Radio One's
high pro forma debt-to-EBITDA leverage of approximately 8.0x
(incorporating Moody's standard adjustments) mitigated by improved
operating performance due to expected political advertising gains
in 4Q10 followed by double digit EBITDA gains in 1Q11 compared to
a weak 1Q10. Despite expected growth in EBITDA and improving
debt-to-EBITDA leverage ratios, reported debt balances will remain
flat at approximately $655 million for the next 12 months due to
the anticipated funding of the TV One capital call as well as the
potential accretion of the PIK portion of the new 12.5%/15%
subordinated notes due 2016.
As reported by the Troubled Company Reporter on March 11, 2011,
Standard & Poor's Ratings Services said it raised its long-term
corporate credit rating on U.S. radio broadcaster Radio One Inc.
to 'B-' from 'CCC+'. The rating outlook is stable. "The 'B-'
rating and stable outlook reflect S&P's view that the
proposed transaction will improve Radio One's financial
flexibility by eliminating near-term refinancing risk and
increasing headroom under financial covenants," said Standard &
Poor's credit analyst Michael Altberg. "Going forward, S&P
believes the company's increased ownership in TV One LLC, a
growing African American-targeted cable TV network, provides
additional diversity to Radio One's business profile and access to
a more stable revenue stream."
RESIDENTIAL CAPITAL: Hedge Fund Advises Against Bankruptcy Filing
-----------------------------------------------------------------
Soyoung Kim, writing for Reuters, reports that New York-based
hedge fund Elliott Management sent a letter to Ally Financial's
board last week saying a bankruptcy filing for Residential
Capital, its mortgage subsidiary, would trigger a protracted legal
battle against the lender and make its proposed public offering
"nearly impossible" for several years. Elliott said Ally should
pursue an out-of-court debt exchange for ResCap and sell its core
assets to a financial institution, according to a March 22 letter
sent to Ally's board, a copy of which was reviewed by Reuters.
"The fact remains that addressing the risks in the mortgage
business is the key to successfully pursing any and all future
strategies to best position the company to return value to its
shareholders and that is our highest priority," an Ally
spokeswoman said, according to Reuters.
Elliott and U.S. Treasury declined to comment, Reuters says.
According to Reuters, people familiar with the matter have said
Ally is in talks to sell ResCap to Fortress Investment Group LLC
through a bankruptcy process. A Fortress deal would become the
so-called stalking horse bid in a subsequent auction overseen by
the bankruptcy court, where other bidders would have a chance to
come in with counterbids.
According to Reuters, sources have said a ResCap bankruptcy filing
is not imminent and will take at least several more weeks to
finalize. The sources noted that there is pressure to get a
filing completed before mid-May, when ResCap faces a maturity on
unsecured notes.
The sources also told Reuters that White & Case, which announced
in January it represents some ResCap secured bondholders, is
currently representing investors who hold more than 45% of junior
secured notes at ResCap. The sources also said Billionaire Warren
Buffett's Berkshire Hathaway has another 45% of the junior secured
notes and also holds a significant portion of ResCap unsecured
notes that mature in May.
The sources told Reuters that ResCap is expected to have parallel
discussions with these two main bondholder groups to reach
settlements.
Elliott holds 2.3% of the common stock of Ally, the former lending
arm of General Motors Co. previously known as GMAC, and is one of
Ally's largest shareholders.
The U.S. Treasury owns a 73.8% stake after its bailout of the
lender during the financial crisis, while GM and its trust have
9.9% and Cerberus Capital Management owns 8.9%.
About Ally Financial
Ally Financial Inc., formerly GMAC Inc. -- http://www.ally.com/--
is one of the world's largest automotive financial services
companies. The company offers a full suite of automotive
financing products and services in key markets around the world.
Ally's other business units include mortgage operations and
commercial finance, and the company's subsidiary, Ally Bank,
offers online retail banking products. Ally operates as a bank
holding company.
GMAC obtained a $17 billion bailout from the U.S. government in
exchange for a 56.3% stake. Private equity firm Cerberus Capital
Management LP keeps 14.9%, while General Motors Co. owns 6.7%.
Ally has tapped Goldman Sachs Group Inc. and Citigroup Inc. to
advise on a range of issues, including strategic alternatives for
the mortgage business and repayment of taxpayer funds.
Ally's balance sheet at Sept. 30, 2011, showed $181.95 billion
in total assets, $162.22 billion in total liabilities and
$19.73 billion in total equity.
ResCap
According to the Form 10-Q for the quarter ended Sept. 30, 2011,
although Ally's continued actions through various funding and
capital initiatives demonstrate support for ResCap, there can be
no assurances for future capital support. Consequently, there
remains substantial doubt about ResCap's ability to continue as a
going concern. Should Ally no longer continue to support the
capital or liquidity needs of ResCap or should ResCap be unable to
successfully execute other initiatives, it would have a material
adverse effect on ResCap's business, results of operations, and
financial position.
Ally said it has extensive financing and hedging arrangements with
ResCap that could be at risk of nonpayment if ResCap were to file
for bankruptcy. At Sept. 30, 2011, Ally had $1.9 billion in
secured financing arrangements with ResCap of which $1.2 billion
in loans was utilized. At Sept. 30, 2011, the hedging
arrangements were fully collateralized. Amounts outstanding under
the secured financing and hedging arrangements fluctuate. If
ResCap were to file for bankruptcy, ResCap's repayments of its
financing facilities, including those with Ally, could be slower.
In addition, Ally could be an unsecured creditor of ResCap to the
extent that the proceeds from the sale of Ally's collateral are
insufficient to repay ResCap's obligations to the Company. It is
possible that other ResCap creditors would seek to recharacterize
Ally's loans to ResCap as equity contributions or to seek
equitable subordination of Ally's claims so that the claims of
other creditors would have priority over Ally's claims.
Ally also said that, should ResCap file for bankruptcy, Ally's
$331 million investment related to ResCap's equity position would
likely be reduced to zero. If a ResCap bankruptcy were to occur
and a substantial amount of Ally's credit exposure is not repaid
to the Company, it could have an adverse impact on Ally's near-
term net income and capital position, but Ally does not believe it
would have a materially adverse impact on Ally's consolidated
financial position over the longer term.
* * *
In February 2012, Fitch Ratings downgraded the long-term Issuer
Default Rating (IDR) and the senior unsecured debt rating of Ally
Financial and its subsidiaries to 'BB-' from 'BB'. The Rating
Outlook is Negative.
The downgrade primarily reflects deteriorating operating trends in
ResCap, which has continued to be a drag on Ally's consolidated
credit profile, as well as exposure to contingent mortgage-related
rep and warranty and litigation issues tied to ResCap, which could
potentially impact Ally's capital and liquidity levels.
RICHARD FRIEDBERG: Court Sustains Objection to P&O Claim
--------------------------------------------------------
Bankruptcy Judge Alan H. W. Shiff sustained the objection of the
Chapter 11 trustee for the bankruptcy estate of Richard H.
Friedberg against the proof of claim filed by Giannina Pradella
and Milan Olich pursuant to a March 21 Memorandum of Decision
available at http://is.gd/A6BLrRfrom Leagle.com.
P&O's alleged claim arises from a 2005 transaction in which they
"sold certain property located at 28 Bear Mountain Bridge Road in
Cortlandt Manor, New York, to an entity called Monteverde LLC."
Richard H. Friedberg filed for Chapter 11 bankruptcy (Bankr. D.
Conn. Case No. 08-51245) on Dec. 18, 2008. Mr. Friedberg claimed
controlling interests in various entities, including Monteverde
LLC and North South Development LLC. Monteverde was established
to hold real property in Cortlandt Manor, New York. North South
is an LLC through which the debtor held real property in South
Carolina. While the debtor caused some of his entities to file
bankruptcy petitions, neither Monteverde nor North South sought
bankruptcy protection.
Related entities controlled by Mr. Friedberg and which sought
bankruptcy protection are 115 Allen Ground, LLC (Case No. 09-
51457); Allen & Delancey, LLC (Case No. 09-51514); and Monteverde
Restaurant, LLC (Case No. 09-51514). These cases were jointly
administered with Mr. Friedberg's case. The 115 Allen Ground and
Allen & Delancey cases are now closed.
RP SAM: Case Transferred to Santa Ana Division
----------------------------------------------
The Chapter 11 case of RP Sam Houston Plaza, L.P., has been
transferred from U.S. Bankruptcy Court Central District of
California Riverside Division to the Santa Ana Division (New Case
No. Assigned: 10-28447. Therefore, the previous case is closed.
Rancho Cucamonga, California-based RP Sam Houston Plaza, L.P.,
filed for Chapter 11 bankruptcy protection on July 29, 2010
(Bankr. C.D. Calif. Case No. 10-33922). D. Edward Hays, Esq., at
Marshack Hays LLP, assists the Debtor in its restructuring effort.
The Company estimated its assets and debts at $10 million to
$50 million in its Chapter 11 petition.
SCHOMAC GROUP: Court Approves Disclosure Statement
--------------------------------------------------
The U.S. Bankruptcy Court for the District of Arizona approved the
disclosure statement filed by The Schomac Group, Inc., et al.
As previously reported by the TCR on Jan. 6, 2012, the Debtors'
Joint Plan of Reorganization contemplates the continued operation
of the business entities, including the marketing of properties,
which will allow the Debtors to pay creditors. The Debtors'
secured debt will be restructured in a manner where payment
obligations do not outstrip the income from the project.
The Plan will be funded by future operations of the Debtors'
businesses, including the sale of properties, as well as by the
dividend income from the Debtors' OP Units in CubeSmart. The
Debtors also have commitments from related non-debtor entities and
the individual equity-holder of the Debtors to fund plan payments,
to the extent the Debtors' revenues are insufficient.
Allowed general unsecured creditors of Schomac will be paid an
initial distribution equal to 10% of each Allowed Claim within 12
months after the Effective Date.
The hearing to consider the confirmation of the Plan will be held
on April 5, 2012, at 10:00 a.m.
About The Schomac Group & TEDCO
Tucson, Arizona-based The Schomac Group, Inc., develops,
constructs, manages, and invests in residential, industrial, and
commercial real property. Tedco, Inc., invests in real property
and in mortgages backed by real property. Schomac Group and Tedco
filed for Chapter 11 bankruptcy (Bankr. D. Ariz. Case Nos. 11-
22717 and 11-22720) on Aug. 9, 2011. In its schedules, Schomac
Group disclosed $48,929,897 in total assets and $34,583,005 in
total liabilities. Judge Eileen W. Hollowell presides over the
cases. Mesch, Clark & Rothschild, P.C., serves as the Debtors'
counsel.
Attorney for secured lender LNV Corp. is William Novotny, Esq., at
Mariscal Weeks McIntyre & Friedlander, PA.
SHOREBANK CORP: U.S. Trustee Forms Unsecured Creditors Committee
----------------------------------------------------------------
Patrick S. Layng, the U.S. Trustee in Chicago, has appointed three
creditors to serve on the official committee of unsecured
creditors in the bankruptcy case of The Shorebank Corporation, et
al., namely:
(1) Jamil Moore
c/o Pavalon & Gifford
Two North LaSalle Street, Suite 1600
Chicago, IL 60602
(2) The Bank of New York Mellon
J. Christopher Matthews
601 Travis Street, 16th Floor
Houston, TX 77002
(3) Wilmington Trust Company
Steve Cimalore
Rodney Square North
1100 Market Street
Wilmington, DE 19890-1615
A creditor's committee consisting of Bank of New York Mellon,
Wilmington Trust Company and Todd Brown was announced following
the first meeting of creditors on Feb. 15, 2012. On Feb. 17,
2012, before the Official Notice of Appointment had been filed,
Mr. Brown resigned from the Committee. Mr. Moore replaces Mr.
Brown.
Committee Composition Questioned
Jamil Moore, Ron Gryzwinski, and Mary Houghton, which hold an
aggregate claim of over $3,000,000, ask the Bankruptcy Court to
direct the U.S. Trustee to reconstitute the Committee. The
Claimants tell the Court that the constitution of the Committee is
unsuitable because it is dominated by holders of trust preferred
securities. They assert that the Committee should include holders
of unsecured claims of a different class and type from those of
the TruPS. In the alternative, the Claimants ask the Court to
appoint a Directors' and Officers' Committee or to disband the
Committee altogether.
In response, the Committee contends that the fact that the
Claimants continue to prosecute the Motion despite the inclusion
of one of them on the Committee speaks volumes about their true
motivation, which is not to obtain "adequate representation" but
rather to obtain "majority representation." In addition to the
costs and delay that would be incurred by the estates if the
Motion were granted, the Committee asserts there is no good reason
to alter its membership.
About ShoreBank
Organized in 1973 and incorporated under the state of Illinois,
The ShoreBank Corporation was America's first and leading
community development and environmental bank holding company. SBK
was a registered bank holding company for, among others, its
subsidiary, ShoreBank in Chicago, a state chartered non-member
bank. The Bank was subject to oversight and regulation by its
primary regulator, the Illinois Department of Financial and
Professional Regulation.
On Aug. 20, 2010, the Bank was closed by the IDFPR, and the
Federal Deposit Insurance Corp. was named receiver. The FDIC sold
substantially all of the Bank's assets to Urban Partnership Bank.
SBK's principal asset and source of income was its investment in
the Bank. The Bank Closure has had a significant adverse affect
on SBK's liquidity, capital resources, and financial condition.
On Jan. 9, 2012, SBK and 11 affiliates commenced Chapter 11 cases
(Bankr. N.D. Ill. Lead Case No. 12-00581) to liquidate their
remaining assets and wind down their estates.
The case was initially assigned to Judge Jacqueline P. Cox. On
Jan. 10, she recused herself and the case was sent to Judge A.
Benjamin Goldgar's chambers.
George Panagakis, Esq., leads a team of lawyers at Skadden, Arps,
Slate, Meagher & Flom LLP, who represent the Debtors. Garden City
Group Inc. serves as the Debtors' claims agent. The petition was
signed by George P. Surgeon, president and CEO.
The Debtors filed their Chapter 11 Plan of Liquidation on Jan. 31,
2012.
SOUTHERN SKY: Direct Air Should Be Liquidated, U.S. Trustee Says
----------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the U.S. Trustee in Boston said in papers filed
March 23 that Direct Air, a charter airline, has no hope for
reorganization and should be liquidated in Chapter 7. The U.S.
Trustee, the bankruptcy watchdog for the Justice Department, said
that assets consist of $45,000 in cash plus furniture and
equipment. Liabilities include $3.9 million in trade debt, $1
million owing to airlines, $1.4 million in taxes, and $1 million
owing to the Transportation Security Administration for security
costs, the U.S. Trustee said, based on information supplied by the
company.
Southern Sky Air & Tours, LLC, doing business as Direct Air, filed
a Chapter 11 petition (Bankr. D. Mass. Case No. 12-40944) on March
15, 2012. Alan L. Braunstein, Esq., at Riemer & Braunstein, LLP,
in Boston, serves as counsel. The Debtor estimated up to $1
million in assets and up to $50 million in liabilities.
SPARTA COMMERCIAL: Incurs $615,900 Net Loss in Jan. 31 Quarter
--------------------------------------------------------------
Sparta Commercial Services, Inc., filed with the U.S. Securities
and Exchange Commission its quarterly report on Form 10-Q
disclosing a net loss of $615,900 on $139,900 of revenue for the
three months ended Jan. 31, 2012, compared with a net loss of
$733,700 on $109,200 of revenue for the same period a year ago.
The Company reported a net loss of $1.59 million on $439,200 of
revenue for the nine months ended Jan. 31, 2012, compared with a
net loss of $2.48 million on $406,100 of revenue for the same
period during the prior year.
The Company's balance sheet at Jan. 31, 2012, showed $980,200 in
total assets, $4.54 million in total liabilities, and a
$3.56 million total deficit.
A copy of the Form 10-Q is available for free at:
http://is.gd/xq8aee
About Sparta Commercial
Based in New York, Sparta Commercial Services, Inc.
-- http://www.spartacommercial.com/-- is a nationwide financial
services company offering financing and leasing products to
consumers and retail powersports dealers. Sparta also serves
municipal and governmental agencies nationwide with its Municipal
Lease Program, which offers financing for essential equipment for
the law enforcement and emergency response communities.
The Company's subsidiary, Specialty Reports, Inc. d/b/a Cyclechex,
is in the business of offering online access to detailed product
ownership and usage reports for various classes of previously
owned assets. Cyclechex's initial product release is the
Cyclechex Motorcycle History Report.
SPOT MOBILE: Incurs $4.5 Million Net Loss in 2011
-------------------------------------------------
Spot Mobile International Ltd. filed with the U.S. Securities and
Exchange Commission its annual report on Form 10-K disclosing a
net loss of $4.53 million on $10.96 million of revenue for the
year ended Oct. 31, 2011, compared with a net loss of
$3.56 million on $16.07 million of revenue during the prior year.
The Company's balance sheet at Oct. 31, 2011, showed $1.66 million
in total assets, $6.83 million in total liabilities, and a
$5.17 million total shareholders' deficit.
For 2011, GHP Horwath, P.C., in Denver, Colorado, expressed
substantial doubt about the Company's ability to continue as a
going concern. The independent auditors noted that the Company
reported a net loss of approximately $4,536,000 for the year ended
Oct. 31, 2011, and has a working capital deficiency and
shareholders' deficit of approximately $6,619,000, and
$11,099,000, respectively, at Oct. 31, 2011.
A copy of the Form 10-K is available for free at:
http://is.gd/xgdhXR
About Spot Mobile
Spot Mobile, formerly Rapid Link Incorporated --
http://www.rapidlink.com/-- is a telecommunications services
company which, through its wholly owned subsidiary, provides
prepaid telecommunication and transaction based point of sale
activation solutions through 1,000 independent retailers in the
Eastern United States. The Company also provides long distance
services and plans to expand its product offering to include
mobile and wireless services.
SPRINGLEAF FINANCE: Bank Debt Trades at 9% Off in Secondary Market
------------------------------------------------------------------
Participations in a syndicated loan under which Springleaf Finance
Inc. is a borrower traded in the secondary market at 90.65 cents-
on-the-dollar during the week ended Friday, March 23, 2012, a drop
of 1.50 percentage points from the previous week according to data
compiled by Loan Pricing Corp. and reported in The Wall Street
Journal. The Company pays 425 basis points above LIBOR to borrow
under the facility. The bank loan matures on May 10, 2017, and
carries Moody's B2 rating and Standard & Poor's CCC+ rating. The
loan is one of the biggest gainers and losers among 192 widely
quoted syndicated loans with five or more bids in secondary
trading for the week ended Friday.
About Springleaf
Springleaf was incorporated in Indiana in 1927 as successor to a
business started in 1920. From Aug. 29, 2001, until the
completion of its sale in November 2010, Springleaf was an
indirect wholly owned subsidiary of AIG. The consumer finance
products of Springleaf and its subsidiaries include non-conforming
real estate mortgages, consumer loans, retail sales finance and
credit-related insurance.
* * *
The Troubled Company Reporter said on Feb. 8, 2012, that Standard
& Poor's Ratings Services lowered its issuer credit rating on
Springleaf Finance Corp. and its issue credit rating on the
company's senior unsecured debt to 'CCC' from 'B'. Standard &
Poor's also said it lowered its issue credit ratings on
Springfield's senior secured debt to 'CCC+' from 'B+' and on the
company's preferred debt to 'CC' from 'CCC-'. The outlook on
Springleaf's issuer credit rating is negative.
"Springleaf's announcement that it will shut down about 60
branches and stop lending in 14 states highlights the operating,
funding, and liquidity challenges that the firm faces as it works
to pay down the $2 billion of debt coming due in 2012 and to
establish a stable long-term funding strategy. The downgrade also
reflects the company's poor earnings, exposure to weak residential
markets and uncertainty about its ability to refinance debt or
securitize assets over the coming year. We believe that should
its funding or securitization options become unavailable, the
company will not have enough liquidity to survive 2012, and in
that case a distressed debt exchange would be likely. The company
has retained financial advisors to assess its options," S&P said.
As reported by the Troubled Company Reporter on Sept. 9, 2011,
Fitch Ratings has downgraded the Issuer Default Ratings (IDRs) and
unsecured debt ratings on Springleaf Finance, Inc. (Springleaf)
and affiliates to 'CCC' from 'B-'.
The downgrade of Springleaf's IDR was driven by Fitch's continued
concerns regarding the company's lack of meaningful liquidity and
funding flexibility, as $2 billion of unsecured debt matures in
2012. Minimal progress has been made in implementing a long-term
funding plan since the acquisition by Fortress Investment Group
LLC (Fortress) in November 2010; therefore, barring meaningful
access to the securitization market over the next several months,
Springleaf may have insufficient flexibility to address its near-
term debt maturities.
STRATEGIC AMERICAN OIL: Incurs $291,877 Net Loss in Fiscal Q2
-------------------------------------------------------------
Strategic American Oil Corporation filed with the U.S. Securities
and Exchange Commission its quarterly report on Form 10-Q
disclosing a net loss of $291,900 on $1.84 million of revenue for
the three months ended Jan. 31, 2012, compared with a net loss of
$651,300 on $116,300 of revenue for the same period during the
prior year.
The Company reported a net loss of $4.49 million on $3.40 million
of revenue for the six months ended Jan. 31, 2012, compared with a
net loss of $1.62 million on $229,100 of revenue for the same
period a year ago.
The Company's balance sheet at Jan. 31, 2012, showed $24.35
million in total assets, $11.59 million in total liabilities and
$12.75 million in total stockholders' equity.
"Our goal of increasing cash flow has continually been achieved
and sets the stage for our aggressive acquisition strategy. Now
that we are debt free, in the midst of completing our new well in
the bay, and looking to drill and recomplete further wells, we are
excited about 2012 and what we can accomplish," said Jeremy G.
Driver, President and Chief Executive Officer of Strategic
American Oil Corporation.
A copy of the Form 10-Q is available for free at:
http://is.gd/TzOqBx
About Strategic American
Corpus Christi, Tex.-based Strategic American Oil Corporation (OTC
BB: SGCA) -- http://www.strategicamericanoil.com/-- is a growth
stage oil and natural gas exploration and production company with
operations in Texas, Louisiana, and Illinois. The Company's team
of geologists, engineers, and executives leverage 3D seismic data
and other proven exploration and production technologies to locate
and produce oil and natural gas in new and underexplored areas.
Strategic American a net loss of $10.28 million on $3.41 million
of revenue for the year ended July 31, 2011, compared with a net
loss of $3.49 million on $531,736 of revenue for the same period
during the prior year.
SUPERMEDIA INC: Board Approves $100,000 Bonus for CEO & EVP Sales
-----------------------------------------------------------------
The Compensation Committee of the Board of Directors of SuperMedia
Inc. approved an award of special bonuses to two of the Company's
executive officers in recognition of their significant
contributions during 2011.
The Committee approved the payment of a special bonus in the
amount of $100,000 to Samuel D. Jones, the Company's Chief
Financial Officer, for his leadership in the Company's expense
reduction initiatives that contributed to the improvement in
operating results that the Committee considers significant to the
Company's deleveraging effort, which resulted in efficient
utilization of cash flows to reduce the Company's senior secured
term loans by $426 million in 2011.
The Committee also approved a special bonus in the amount of
$100,000 to Del Humenik, the Company's Executive Vice President -
Sales, to recognize his efforts in developing and implementing the
transition to the Company's new business model focused on becoming
a trusted marketing partner for small and medium businesses across
search, mobile, social and traditional media, designed to
effectively connect advertisers with their target audiences
through a variety of digital advertising solutions.
About SuperMedia Inc.
DFW Airport, Texas-based SuperMedia Inc. and its subsidiaries
sells advertising solutions to its clients and places their
advertising into its various advertising media. The Company's
advertising media include Superpages yellow page directories,
Superpages.com, its online local search resource, the
Superpages.com network, an online advertising network, Superpages
direct mailers, and Superpages mobile, its local search
application for wireless subscribers.
The Company is the official publisher of Verizon Communications
Inc. print directories in the markets in which Verizon is
currently the incumbent local telephone exchange carrier. The
Company also has agreements with FairPoint Communications, Inc.,
and Frontier Communications Corporation in various Northeast and
Midwest markets in which FairPoint and Frontier are the local
exchange carriers.
On March 31, 2009, SuperMedia Inc., formerly known as Idearc Inc.,
and all of its domestic subsidiaries filed voluntary petitions for
Chapter 11 relief (Bankr. N.D. Tex. Lead Case No. 09-31828).
On Sept. 8, 2009, the Company filed its First Amended Joint Plan
of Reorganization with the Bankruptcy Court, which was later
modified on Nov. 19, 2009, and on Dec. 22, 2009, the Bankruptcy
Court entered an order approving and confirming the Amended Plan.
On Dec. 31, 2009 (the "Effective Date"), the Debtors consummated
the reorganization and emerged from the Chapter 11 bankruptcy
proceedings. On Dec. 29, 2011, the Bankruptcy Court entered final
decrees closing the bankruptcy cases for the Debtors.
The Company reported a net loss of $771 million in 2011 and a net
loss of $196 million in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $1.63 billion
in total assets, $2.42 billion in total liabilities and a $788
million total stockholders' deficit.
* * *
As reported in the TCR on Dec. 27, 2011, Standard & Poor's Ratings
Services raised its corporate credit rating on Dallas-based
SuperMedia Inc. to 'CCC+' from 'SD' (selective default). The
rating outlook is negative.
TELVUE CORP: Completes Debt Conversion Transaction & Stock Split
----------------------------------------------------------------
TelVue Corporation announced that the 1 for 200 (reverse) stock
split in conjunction with a conversion of the Company's debt to
Common and Preferred Stock, both approved by the Stockholders at a
Special Meeting on March 12, 2012, will became effective on
March 22, 2012. For the 20 business days following the effective
date of the reverse split, TelVue's Common Stock will be eligible
for quotation under the ticker symbol TEVED.PK, after which time
its ticker will revert to TEVE.PK.
At the effective time of the Reverse Split on March 22, 2012,
TelVue's capital restructuring will be complete. The first step
in the restructuring was the March 16, 2012, conversion of
$25,862,082 of debt and accrued interest held by H.F. "Gerry"
Lenfest, TelVue's Chairman and majority stockholder, into
73,891,663 shares of TelVue Common Stock, and the conversion of
$5,000,000 of debt, designed to fund TelVue continued product
development, and also held by Mr. Lenfest, into TelVue Series A
Convertible Preferred Stock. These conversions eliminated all of
the Company's debt and accrued interest owed to Mr. Lenfest. As a
result of the conversion of debt into Common Stock, TelVue's
issued and outstanding shares of Common Stock increased to
123,074,807. The Reverse Split will reduce the issued and
outstanding Common Stock to approximately 615,374, and it will
reduce the number of authorized shares of Common Stock from
600,000,000 to 3,000,000.
"The Board of Directors and Stockholders votes of confidence have
been very encouraging and now that the conversion is complete,
TelVue is on a stronger financial footing," said Jesse Lerman,
TelVue's President and Chief Executive Officer. "This will
accelerate our product development and should give our current and
potential customers confidence in our expanding array of
traditional and Cloud-based broadcast services."
"As a result of the Reverse Split, every two hundred (200) shares
of TelVue Common Stock will be combined into one (1) share of
TelVue Common Stock. The Reverse Split affects all of the
Company's Common Stock issued and outstanding as well as the
number of shares of Common Stock available for issuance under the
Company's equity incentive plans. In lieu of fractional shares to
which a holder of the Company's Common Stock would otherwise be
entitled as a result of the Reverse Split, the Company's transfer
agent will pay cash in an amount equal to the proceeds
attributable to the sale of such fractional shares following the
aggregation and sale by the Company's transfer agent of all
fractional shares otherwise issuable."
About TelVue Corporation
Mt. Laurel, N.J.-based TelVue Corporation is a broadcast
technology company that specializes in playback, automation and
workflow solutions for public, education and government ("PEG")
television stations; cable, telephone company ("Telco") and
satellite television providers; K-12 and higher education
institutions; and professional broadcasters.
The Company also reported a net loss of $2.43 million on
$3.40 million of revenue for the nine months ended Sept. 30, 2011,
compared with a net loss of $2.53 million on $2.71 million of
revenue for the same period during the prior year.
The Company's balance sheet at Sept. 30, 2011, showed
$1.62 million in total assets, $26.15 million in total
liabilities, and a $24.52 million stockholders' deficit.
ParenteBeard LLC, in Huntingdon Valley, Pa., expressed substantial
doubt about TelVue's ability to continue as a going concern,
following the Company's 2010 results. The independent auditors
noted that the Company has suffered recurring losses from
operations and has a net accumulated deficit.
TRIBUNE CO: Bank Debt Trades at 33% Off in Secondary Market
-----------------------------------------------------------
Participations in a syndicated loan under which Tribune Co. is a
borrower traded in the secondary market at 66.51 cents-on-the-
dollar during the week ended Friday, March 23, 2012, a drop of
0.45 percentage points from the previous week, according to data
compiled by Loan Pricing Corp. and reported in The Wall Street
Journal. The Company pays 300 basis points above LIBOR to borrow
under the facility. The bank loan matures on May 17, 2014. The
loan is one of the biggest gainers and losers among 192 widely
quoted syndicated loans with five or more bids in secondary
trading for the week ended Friday.
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Co. --
http://www.tribune.com/-- is a media company, operating
businesses in publishing, interactive and broadcasting, including
ten daily newspapers and commuter tabloids, 23 television
stations, WGN America, WGN-AM and the Chicago Cubs baseball team.
The Company and 110 of its affiliates filed for Chapter 11
protection (Bankr. D. Del. Lead Case No. 08-13141) on Dec. 8,
2008. The Debtors proposed Sidley Austin LLP as their counsel;
Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel;
Lazard Ltd. and Alvarez & Marsal North America LLC as financial
advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As
of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets
and $12,972,541,148 in total debts. Chadbourne & Parke LLP and
Landis Rath LLP serve as co-counsel to the Official Committee of
Unsecured Creditors. AlixPartners LLP is the Committee's
financial advisor. Landis Rath Moelis & Company serves as the
Committee's investment banker. Thomas G. Macauley, Esq., at
Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the
Committee in connection with the lawsuit filed against former
officers and shareholders for the 2007 LBO of Tribune.
Protracted negotiations and mediation efforts and numerous
proposed plans of reorganization filed by Tribune Co. and
competing creditor groups have delayed Tribune's emergence from
bankruptcy. Many of the disputes among creditors center on the
2007 leveraged buyout fraudulence conveyance claims, the
resolution of which is a key issue in the bankruptcy case. The
bankruptcy court has scheduled a May 16 hearing on Tribune's plan.
Tribune CRO Don Liebentritt said it is possible the media company
could emerge late in the third quarter of 2012.
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)
TXU CORP: Bank Debt Trades at 43% Off in Secondary Market
---------------------------------------------------------
Participations in a syndicated loan under which TXU Corp., now
known as Energy Future Holdings Corp., is a borrower traded in the
secondary market at 56.93 cents-on-the-dollar during the week
ended Friday, March 23, 2012, a drop of 0.24 percentage points
from the previous week according to data compiled by Loan Pricing
Corp. and reported in The Wall Street Journal. The Company pays
450 basis points above LIBOR to borrow under the facility. The
bank loan matures on Oct. 10, 2017, and carries Moody's B2 rating
and Standard & Poor's CCC rating. The loan is one of the biggest
gainers and losers among 192 widely quoted syndicated loans with
five or more bids in secondary trading for the week ended Friday.
About Energy Future
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a portfolio
of competitive and regulated energy businesses in Texas. Oncor,
an 80%-owned entity within the EFH group, is the largest regulated
transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
The Company's balance sheet at Dec. 31, 2011, showed $44.07
billion in total assets, $51.83 billion in total liabilities, and
a $7.75 billion total deficit.
Energy Future had a net loss of $1.91 billion on $7.04 billion of
operating revenues for the year ended Dec. 31, 2011, compared with
a net loss of $2.81 billion on $8.23 billion of operating revenues
during the prior year.
* * *
In April 2011, Moody's Investors Service affirmed the 'Caa2'
Corporate Family Rating, 'Caa3' Probability of Default Rating and
SGL-4 Speculative Grade Liquidity Ratings of EFH. Outlook is
stable. EFH's Caa2 CFR and Caa3 PDR reflect a financially
distressed company with limited financial flexibility; its capital
structure appears to be untenable, calling into question the
sustainability of the business model; and there is no expectation
for any meaningful debt reduction over the next few years, beyond
scheduled amortizations.
At the end of February 2011, Fitch Ratings it does not expect to
take any immediate rating action on EFH's Texas Competitive
Electric Holdings Company LLC or their affiliates based on recent
default allegations from lender Aurelius. EFH carries a 'CCC'
corporate rating, with negative outlook, from Fitch.
THUNDERBIRD MINING: PBGC Termination of Pension Plan Valid
----------------------------------------------------------
In May 2003, the Thunderbird Mining Company filed for bankruptcy,
stopped production at its iron ore facility, and placed nearly 400
hourly employees on indefinite temporary layoff. In light of
Thunderbird's troubled business prospects, the Pension Benefit
Guaranty Company, in accordance with its statutory mandate to
insure and protect pension benefits, moved to terminate the
pension plan that Thunderbird had established for its hourly
workers and have the PBGC appointed as statutory trustee of the
plan. Former Thunderbird employees represented through their
union representative, challenge the PBGC's denial, as
administrator of the Thunderbird pension plan, of certain benefits
to which they claim they are entitled under the plan.
Specifically, the Thunderbird employees challenge the PBGC's
determination that the Thunderbird facility had not undergone a
"permanent shutdown" prior to termination of the pension plan and
contend that the PBGC's denial of "shutdown benefits" to the
employees was erroneous.
In a March 20, 2012 Memorandum Opinion, District Judge Beryl A.
Howell held that the PBGC's determination that a "permanent
shutdown" had not occurred prior to the plan termination date was
not arbitrary, capricious, an abuse of discretion, or otherwise
not in accordance with law. Accordingly, the PBGC's motion for
summary judgment is granted and the employees' motion for summary
judgment on liability is denied.
The case is, United Steel, Paper and Forestry, Rubber,
Manufacturing, Energy, Allied Industrial and Service Workers
International Union, AFL-CIO-CLC, on behalf of the Participants
and Beneficiaries of the Thunderbird Mining Co. Pension Plan, et
al., v. Pension Benefit Guaranty Corporation, Civil Action No. 09-
517 (D. D.C.). A copy of the Court's decision is available at
http://is.gd/P7rg1Rfrom Leagle.com.
Thunderbird Mining Co., based in Eleveth, Minnesota, filed for
Chapter 11 bankruptcy (Bankr. D. Minn. Case No. 03-50641) on May
15, 2003. Thunderbird employed roughly 400 hourly employees and
provided low-grade iron ore in the form of taconite pellets for
steel production. The company was a wholly owned subsidiary of
Eveleth Mines, LLC, which itself was jointly owned by three steel
companies: Rouge Steel, AK Steel, and Stelco. These companies not
only owned Eveleth Mines, but were also its sole customers for
taconite pellets.
Judge Gregory F. Kishel oversees the case. Michael L. Meyer, Esq.,
at Ravich Meyer Kirkman Mcgrath & Nauman, served as the Debtor's
counsel. In its petition, the Debtor estimated $10 million to $50
million in assets and debts.
Eveleth Mines filed its own bankruptcy (Bankr. D. Minn. Case No.
03-50569) on May 1, 2003. In early October 2003, mining company
Cleveland-Cliffs and Laiwu Steel Group Ltd. offered to purchase
Eveleth Mines as an operational mining company. In November 2003,
the bankruptcy court converted Eveleth Mines' bankruptcy
proceedings from Chapter 11 reorganization, to Chapter 7
liquidation. The bankruptcy court approved the sale of all of
Eveleth Mines' operating assets to Cleveland-Cliffs and Laiwu.
WAGSTAFF MINNESOTA: Wants to Hire M. Green as Accountant
--------------------------------------------------------
Wagstaff Minnesota, Inc., et al., seek permission from the
Bankruptcy Court to employ M. Green and Company LLP as their
independent certified public accountant.
It is anticipated that MG & Co. will:
(a) review of the Debtors' balance sheets and related
statements of operations, changes in equity, cash flows,
and supplementary information for the year ending Dec. 31,
2011; and
(b) issue accountants' reports in accordance with Statements on
Standards for Accounting and Review Services issued by the
American Institute of Certified Public Accountants.
The Debtors will pay the firm in accordance with its hourly rates:
Professional Hourly Rate
------------ -----------
Marla D. Borges, CPA $190
Nicole Centofanti, CPA $116
Mary Quillin $104
Brenda Daddino, CPA $86
Cliff Ingram $69
Sherie Schaff $74
Carol Greeson $70
Kendra Nunes $57
In addition to hourly fees, the Debtors will reimburse MG & Co.
for any reasonable and necessary expenses for report reproduction,
word processing, postage, travel, copies, and telephone charges.
To the best of the Debtors' knowledge, MG & Co. neither holds nor
represents an interest adverse to the Debtors' estates, and (ii)
MG & Co. has no connection to the Debtors, their creditors, their
shareholders or related parties.
Since August 2007, MG & Co. has provided the Debtors with
independent CPA services in connection with the audits and reviews
of the Debtors' financial statements. During the 12 months prior
to the Petition Date, the Debtors paid MG & Co. on an hourly rate
basis a total of $74,953. The Debtors currently owe MG & Co.
$28,500 for services provided to the Debtors prepetition.
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.
WAGSTAFF MINNESOTA: Has Until June 30 to Propose a Chap. 11 Plan
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Minnesota has
extended Wagstaff Minnesota, Inc., et al.'s exclusive right to
file a Chapter 11 plan until June 30, 2012. The period in which
the Debtors have the exclusive right to obtain acceptance of that
Plan is extended through Aug. 30, 2012.
The linchpin of the Debtors' Proposed Plan is the exercise of
their rights under Section 365(a) of the Bankruptcy Code to reject
agreements that would terminate their licenses to operate their
KFC-branded restaurants without rejecting the KFC-franchise
agreements that give rise to those licenses.
Although the Bankruptcy Court, in its order dated Aug. 2, 2011,
held that rejection of the Reinstatement Agreements wholly apart
from the New Franchise Agreements was appropriate, KFC Corporation
appealed the Rejection Order to the District Court, and the
District Court reversed the Rejection Order. The District Court
Judgment put the Debtors' ability to assume the New Franchise
Agreements and, consequently, their ability to confirm their
Proposed Plan, into question.
The Debtors are currently appealing the District Court Judgment to
the Eighth Circuit.
The Debtors asserted that until their appeal to the Eighth Circuit
is resolved they will not be in a position to pursue confirmation
of their Proposed Plan or emerge from bankruptcy.
On March 9, 2012, KFC Corporation filed an objection to the
Debtors' Extension Motion. KCC asserted that there is no reason
to extend the Debtors' exclusivity period. According to KFC, the
Debtors have had adequate time to explore options for
reorganization, negotiate with creditors and gather adequate
information to prepare a disclosure statement and a plan of
reorganization.
"What this case requires is the freedom for other constituents to
propose and seek approval of competing plans of reorganization.
By denying the extension, this Court would not prejudice the
Debtors' co-existent right to file a plan, nor dilute the Debtors'
duty to file a plan," asserts Erika R. Barnes, Esq., --
ebarnes@stites.com -- at Stites & Harbison PLLC, in Nashville,
Tennessee, counsel for KFC.
The Debtors originally sought extension of their exclusive right
to file a Plan through Oct. 30, 2012, and extension of their
exclusive right to solicit acceptances of that Plan through
Dec. 30, 2012. Based upon agreement by the Debtors to shorten the
period through June 30, 2012, KFC's Objection was withdrawn.
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.
WASTE2ENERGY HOLDINGS: Heading for Auction, No Buyer Signed Yet
---------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the trustee for Waste2Energy Holdings Inc. is
soliciting offers for at least $1 million to buy the business of
designing small to medium-sized plants converting waste to energy.
If approved by the bankruptcy judge in Delaware at a March 29
hearing, bids will be due initially by April 20, followed by an
auction on April 24 and a hearing to approve the sale on April 26.
About Waste2Energy Holdings
Greenville, S.C.-based Waste2Energy Holdings, Inc. (Pink Sheets:
WTEZ) -- http://www.waste2energy.com/-- is a "cleantech"
technology company that designs, builds, installs and sells waste
to energy plants that generate "Renewable Green Power" converting
biomass or other solid waste streams traditionally destined for
landfills into clean renewable energy.
The Company's balance sheet at June 30, 2010, showed $3.4 million
in total assets, $11.7 million in total liabilities, and a
stockholders' deficit of $8.3 million.
On Aug. 8, 2011, four creditors filed an involuntary Chapter 11
petition against Waste2Energy Holdings (Bankr. D. Del. Case No.
11-12504). Judge Kevin J. Carey presides over the case. The
petitioning creditors, allegedly owed $3.2 million in the
aggregate, are represented by Frederick B. Rosner, Esq., at The
Rosner Law Group, LLC.
On Sept. 21, 2011, the Court entered an order effectively
converting the case from an involuntary to voluntary chapter 11
proceeding.
On Oct. 4, 2011, Wayne P. Weitz was appointed Chapter 11 trustee.
Cole, Schotz, Meisel, Forman & Leonard, P.A., is the Trustee's
bankruptcy counsel.
WAXESS HOLDINGS: Incurs $9.4 Million Net Loss in 2011
-----------------------------------------------------
AirTouch Communications, Inc., fka Waxess Holdings, filed with the
U.S. Securities and Exchange Commission its annual report on Form
10-K disclosing a net loss of $9.41 million on $326,270 of net
revenue for the year ended Dec. 31, 2011, compared with a net loss
of $4.85 million on $160,441 of net revenue during the prior year.
The Company's balance sheet at Dec. 31, 2011, showed $7.24 million
in total assets, $717,790 in total liabilities and $6.52 million
in total stockholders' equity.
For 2011, Anton & Chia, LLP, in Irvine, California, expressed
substantial doubt about the Company's ability to continue as a
going concern. The independent auditors noted that the Company
has sustained accumulated losses from operations totaling
approximately $16 million at Dec. 31, 2011.
A copy of the Form 10-K is available for free at:
http://is.gd/EgwM3L
About Waxess Holdings
Waxess Holdings, Inc., is a technology firm, located in Newport
Beach, Calif., that was incorporated in 2008 and develops and
markets phone terminals capable of converging traditional
landline, cellular and data services based on its patent
portfolio. Waxess currently offers its DM1000 (cell@home) product
through various channels, including several of the major US
carriers, and is working to bring its higher performance, lower
cost next generation DM1500 and MAT1000 products to the market.
WESTERN COMMUNICATIONS: Court Approves Disclosure Statement
-----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Oregon approved the
disclosure statement explaining the proposed Chapter 11 plan of
Western Communications, Inc.
As reported by the TCR on Feb. 8, 2012, the First Amended Plan of
Reorganization provides that the Debtor will pay all creditors in
full. The Plan contemplates that the Debtor will continue to
operate in the ordinary course and will pay and satisfy its
obligations under the Plan from Debtor's existing current assets
and from revenue generated by Debtor's continuing operations.
Bank of America is the Debtor's largest creditor and has security
interest in all or substantially all of the Debtor's personal
property and most of the Debtor's real property. The amended Plan
provides that B of A does not have a security interest in the
Debtor's real property located in Baker City, Oregon; Redmond,
Oregon,; Brookings, Oregon; or Hermiston, Oregon (with a combined
appraised fair market value of approximately $1,165,000).
Under the Amended Plan, B of A will have an Allowed Claim in the
amount of (i) all amounts owing by the Debtor to B of A as of the
Petition Date, plus (ii) to the extent that the value of B of A's
collateral securing its claim as of the Petition Date is greater
than the amount owing to B of A as of the Petition Date, interest
from the Petition Date through the Effective Date at the non-
default contract rate of interest and other reasonable fees, costs
or charges provided for under the BofA Loan Documents.
The hearing on confirmation of the Plan will be held on April 11,
2012, at 11:00 a.m.
About Western Communications
Western Communications, Inc., is a family-owned corporation
founded by renowned editor Robert W. Chandler. Headquartered in
Bend, Oregon, Western Communications is a small market newspaper,
niche publishing, printing and digital media company with
publications spread throughout Oregon (six publications) and
California (two publications). The Company produces and publishes
the Bend Bulletin, the Baker City Herald, the La Grande Observer,
the Redmond Spokesman, the Brookings Curry Coastal Pilot, the
Crescent City Daily Triplicate, and the Sonora Union Democrat.
The Company also publishes the Central Oregon Nickel Ads in Bend,
Oregon.
Western Communications filed for Chapter 11 bankruptcy (Bankr. D.
Ore. Case No. 11-37319) on Aug. 23, 2011. Albert N. Kennedy,
Esq., and Michael W. Fletcher, Esq., at Tonkon Torp LLP, in
Portland, Oregon, serve as the Debtor's bankruptcy counsel. The
Zinser Law Firm, P.C., and Davis Wright Tremaine LLP serve as the
Debtor's special purpose counsel. The petition was signed by
Gordon Black, president. In its amended schedules, the Debtor
disclosed assets of $31,255,376 and liabilities of $19,068,329 as
of the petition date.
The U.S. Trustee said that an official committee of unsecured
creditors has not been appointed because an insufficient number of
persons holding unsecured claims against Western Communications
have expressed interest in serving on a committee.
* New Bankruptcy Judges in Brooklyn and Rochester, New York
-----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that two new bankruptcy judges donned robes in New York
over the last month. Nancy Hershey Lord, formerly with the office
of the New York State Attorney General, was sworn in as a
bankruptcy judge in the Eastern District of New York on Feb. 29.
Her chambers are in Brooklyn.
Paul R. Warren, who had been clerk of the Western District of New
York, ascended to the bench on March 15 in Rochester.
There is a vacancy in the bankruptcy court in Manhattan upon the
retirement of U.S. Bankruptcy Judge Arthur J. Gonzalez. His slot
can't be filled because Congress has failed to adopt legislation
extending 30 temporary bankruptcy judgeships around the country.
The Southern District of New York had one temporary judgeship,
thus precluding a replacement for Gonzalez.
* Georgia, Illinois Banks Raise Failures to 15 This Year
--------------------------------------------------------
Premier Bank of Wilmette, Illinois and Covenant Bank & Trust Co.
from Rock Springs, Georgia were taken over by regulators on
March 23.
Premier Bank's deposits of $199 million were transferred to Bank
of Chicago. The failure will cost the Federal Deposit Insurance
Corp. $64 million.
Covenant Bank's failure cost the FDIC $31.5 million. It was the
year's fourth bank failure in Georgia. Its two branches were
transferred to Stearns Bank NA of St. Cloud, Minnesota.
In 2010, 157 banks with $92.1 billion in total assets failed while
92 institutions with $34.9 billion in total assets were closed in
2011.
As the economy recovers and the 2007-2009 financial crisis fades
further into the distance, the pace of bank failures has slowed,
Reuters says.
According to Reuters, smaller banks, particularly those with less
than $1 billion in assets, have made up the majority of closures
the past few years.
2012 Failed Banks List
The FDIC was appointed as receiver for the closed banks. To
protect the depositors, the FDIC entered into a purchase and
assumption agreement with various banks that agreed to assume the
deposits of most of the closed banks. The FDIC also entered into
loss-share transactions on assets bought by the banks.
For this year, the failed banks are:
Loss-Share
Transaction Party FDIC Cost
Assets of Bank That Assumed to Insurance
Closed Bank Deposits & Bought Fund
Closed Bank (millions) Certain Assets (millions)
----------- ----------- ----------------- ------------
Premier Bank $268.7 Int'l Bank of Chi. $64.1
Covenant Bank $95.7 Stearns Bank, N.A. $31.5
New City Bank $71.2 [No Acquirer] $17.4
Global Commerce Bank $143.7 Metro City Bank $17.9
Home Savings of Amer. $434.1 [No Acquirer] $38.8
Central Bank of Georgia $278.9 Ameris Bank $67.5
Charter National Bank $93.9 Barrington Bank $17.4
SCB Bank $182.6 First Merchants Bank $33.9
Tennessee Commerce $1,185.0 Republic Bank & Trust $416.8
First Guaranty Bank $377.9 CenterState Bank $82.0
BankEast $272.6 U.S. Bank N.A. $75.6
Patriot Bank $111.3 First Resource Bank $32.6
The First State Bank $416.8 Hamilton State Bank $416.8
Central Florida $79.1 CenterState Bank $24.4
American Eagle $19.6 Capital Bank, N.A. $3.2
In 2011 there were 92 failed banks, compared with 157 in 2010, 140
in 2009 and just 25 for 2008.
A complete list of banks that failed since 2000 is available at:
http://www.fdic.gov/bank/individual/failed/banklist.html
813 Banks in Problem List
The FDIC's Quarterly Banking Profile for Dec. 31, 2011, says that
The number of institutions on the FDIC's "Problem List" declined
from 844 to 813 during the quarter, and total assets of "problem"
institutions fell from $339 billion to $319.4 billion. The number
of institutions in the "problem list" has decreased for the third
consecutive quarter.
The FDIC defines "problem" institutions as those with financial,
operational or managerial weaknesses that threaten their
viability.
The deposit insurance fund, which protects customer holdings up to
$250,000 per account in the event of a failure, saw its balance
increase in the fourth quarter to $9.2 billion (unaudited) from
$7.8 billion in the third quarter, the eighth consecutive
quarterly increase.
Problem Institutions Failed Institutions
-------------------- -------------------
Year Number Assets (Mil) Number Assets (Mil)
---- ------ ------------ ------ ------------
2011 813 $319,432 92 $34,923
2010 884 $390,017 157 $92,085
2009 702 $402,800 140 $169,700
2008 252 $159,405 25 $371,945
2007 76 $22,189 3 $2,615
2006 50 $8,265 0 $0
2005 52 $6,607 0 $0
2004 80 $28,250 4 $170
Federal regulators assign a composite rating to each financial
institution, based upon an evaluation of financial and operational
criteria. The rating is based on a scale of 1 to 5 in ascending
order of supervisory concern. "Problem" institutions are those
institutions with financial, operational, or managerial weaknesses
that threaten their continued financial viability. Depending upon
the degree of risk and supervisory concern, they are rated either
a "4" or "5." The number and assets of "problem" institutions are
based on FDIC composite ratings. Prior to March 31, 2008, for
institutions whose primary federal regulator was the OTS, the OTS
composite rating was used.
* S&P's Global Default Tally at 24 as of March 21
-------------------------------------------------
One confidential issuer based in Canada defaulted last week,
raising the 2012 global default tally to 24, said an article
published March 22 by Standard & Poor's Global Fixed Income
Research, titled "Global Corporate Default Update (March 15 - 21,
2012)." Of the total, 14 were based in the U.S., five in the
emerging markets, three in Europe, and two in the other developed
region (Australia, Canada, Japan, and New Zealand). In
comparison, last year, only five issuers -- four based in the U.S.
and one in Europe -- defaulted during the same period (through
March 21).
So far this year, missed payments accounted for nine defaults,
bankruptcy filings accounted for five, distressed exchanges were
responsible for three, and four defaulters were confidential. Of
the remaining defaults, one was the result of a notice of
acceleration by the issuer's lender, one was due to the company's
placement under regulatory supervision, and the last was due to a
judicial organization filing.
In 2011, 21 issuers defaulted because of missed interest or
principal payments, and 13 because of bankruptcy filings -- both
of which were among the top reasons for defaults in 2010.
Distressed exchanges -- another top reason for default in 2010 --
followed with 11 defaults in 2011. Of the remaining defaults, two
issuers failed to finalize refinancing on bank loans, and two were
subject to regulatory action, one had its banking license revoked
by its country's central bank, one was appointed a receiver, and
two were confidential.
* Large Companies With Insolvent Balance Sheets
-----------------------------------------------
Total
Share- Total
Total Holders' Working
Assets Equity Capital
Company Ticker ($MM) ($MM) ($MM)
------- ------ ------ -------- -------
ABSOLUTE SOFTWRE ABT CN 125.3 (7.2) 10.8
ACCO BRANDS CORP ABD US 1,116.7 (61.9) 316.8
ALASKA COMM SYS ALSK US 605.1 (50.9) (9.7)
AMC NETWORKS-A AMCX US 2,183.9 (1,037.0) 525.8
AMER AXLE & MFG AXL US 2,328.7 (419.6) 187.0
AMER RESTAUR-LP ICTPU US 33.5 (4.0) (6.2)
AMERISTAR CASINO ASCA US 2,012.0 (90.6) (33.0)
AMYLIN PHARM INC AMLN US 1,870.2 (138.7) 125.2
ANOORAQ RESOURCE ARQ SJ 927.7 (148.7) 29.2
ARRAY BIOPHARMA ARRY US 82.2 (127.2) (15.1)
AUTOZONE INC AZO US 6,056.5 (1,295.5) (608.2)
BAZAARVOICE INC BV US 46.8 (15.4) (18.2)
BOSTON PIZZA R-U BPF-U CN 146.9 (105.3) (2.0)
CABLEVISION SY-A CVC US 7,143.3 (5,560.3) (240.5)
CAPMARK FINANCIA CPMK US 20,085.1 (933.1) -
CARMIKE CINEMAS CKEC US 422.9 (5.6) (33.4)
CC MEDIA-A CCMO US 16,542.0 (7,471.9) 1,556.3
CENTENNIAL COMM CYCL US 1,480.9 (925.9) (52.1)
CENVEO INC CVO US 1,385.6 (381.7) 199.9
CERES INC CERE US 33.1 (13.7) 12.0
CHENIERE ENERGY CQP US 1,737.3 (545.0) 57.7
CHENIERE ENERGY LNG US 2,915.3 (173.0) 6.5
CHOICE HOTELS CHH US 447.7 (25.6) 10.2
CIENA CORP CIEN US 1,918.3 (21.1) 918.6
CINCINNATI BELL CBB US 2,714.7 (715.2) (35.4)
CLOROX CO CLX US 4,290.0 (199.0) (289.0)
CROWN HOLDINGS I CCK US 6,868.0 (239.0) 318.0
DEAN FOODS CO DF US 5,754.4 (98.7) 220.8
DELTA AIR LI DAL US 43,499.0 (1,396.0) (4,972.0)
DENNY'S CORP DENN US 350.5 (9.7) (25.9)
DIGITAL DOMAIN M DDMG US 178.9 (85.7) (38.3)
DIRECTV-A DTV US 18,423.0 (2,842.0) (502.0)
DISH NETWORK-A DISH US 11,470.2 (419.0) 527.3
DISH NETWORK-A EOT GR 11,470.2 (419.0) 527.3
DOMINO'S PIZZA DPZ US 480.5 (1,209.7) 129.7
DUN & BRADSTREET DNB US 1,977.1 (740.2) (226.6)
FREESCALE SEMICO FSL US 3,415.0 (4,480.0) 1,432.0
GENCORP INC GY US 939.5 (207.2) 101.1
GLG PARTNERS INC GLG US 400.0 (285.6) 156.9
GLG PARTNERS-UTS GLG/U US 400.0 (285.6) 156.9
GOLD RESERVE INC GRZ US 78.3 (25.8) 56.9
GOLD RESERVE INC GRZ CN 78.3 (25.8) 56.9
GRAHAM PACKAGING GRM US 2,947.5 (520.8) 298.5
HCA HOLDINGS INC HCA US 26,898.0 (7,014.0) 1,679.0
HUGHES TELEMATIC HUTCU US 94.0 (111.8) (39.0)
HUGHES TELEMATIC HUTC US 94.0 (111.8) (39.0)
INCYTE CORP INCY US 329.0 (227.1) 175.2
IPCS INC IPCS US 559.2 (33.0) 72.1
ISTA PHARMACEUTI ISTA US 153.1 (49.1) 2.3
JUST ENERGY GROU JE US 1,644.4 (394.5) (338.4)
JUST ENERGY GROU JE CN 1,644.4 (394.5) (338.4)
LIN TV CORP-CL A TVL US 1,077.7 (80.9) 56.6
LIZ CLAIBORNE LIZ US 950.0 (109.0) 124.8
LORILLARD INC LO US 3,008.0 (1,513.0) 1,079.0
MANNING & NAPIER MN US 66.1 (184.6) -
MARRIOTT INTL-A MAR US 5,910.0 (781.0) (1,234.0)
MEAD JOHNSON MJN US 2,766.8 (168.0) 689.6
MERITOR INC MTOR US 2,553.0 (983.0) 180.0
MONEYGRAM INTERN MGI US 5,175.6 (110.2) (40.4)
MOODY'S CORP MCO US 2,876.1 (158.4) 290.4
MORGANS HOTEL GR MHGC US 557.7 (84.5) 13.0
NATIONAL CINEMED NCMI US 820.2 (346.8) 68.4
NAVISTAR INTL NAV US 11,503.0 (190.0) 2,238.0
NEXSTAR BROADC-A NXST US 595.0 (183.4) 39.6
NPS PHARM INC NPSP US 214.0 (46.1) 156.0
NYMOX PHARMACEUT NYMX US 6.4 (5.2) 2.9
ODYSSEY MARINE OMEX US 23.4 (9.5) (8.8)
OMEROS CORP OMER US 27.0 (5.6) 7.0
OTELCO INC-IDS OTT-U CN 317.7 (12.4) 18.6
OTELCO INC-IDS OTT US 317.7 (12.4) 18.6
PALM INC PALM US 1,007.2 (6.2) 141.7
PDL BIOPHARMA IN PDLI US 269.5 (204.3) 100.5
PETROALGAE INC PALG US 8.3 (76.0) (77.4)
PLAYBOY ENTERP-A PLA/A US 165.8 (54.4) (16.9)
PLAYBOY ENTERP-B PLA US 165.8 (54.4) (16.9)
PRIMEDIA INC PRM US 208.0 (91.7) 3.6
PROTECTION ONE PONE US 562.9 (61.8) (7.6)
QUALITY DISTRIBU QLTY US 302.4 (106.2) 45.8
REGAL ENTERTAI-A RGC US 2,341.3 (572.5) 2.8
RENAISSANCE LEA RLRN US 57.0 (28.2) (31.4)
RENTECH NITROGEN RNF US 152.4 (76.1) (32.3)
REVLON INC-A REV US 1,157.1 (692.9) 183.3
RSC HOLDINGS INC RRR US 3,141.0 (38.4) (1.0)
RURAL/METRO CORP RURL US 303.7 (92.1) 72.4
SALLY BEAUTY HOL SBH US 1,792.7 (168.5) 482.3
SINCLAIR BROAD-A SBGI US 1,571.4 (111.4) 14.1
SINCLAIR BROAD-A SBTA GR 1,571.4 (111.4) 14.1
SMART TECHNOL-A SMA CN 529.8 (7.1) 183.9
SMART TECHNOL-A SMT US 529.8 (7.1) 183.9
SUN COMMUNITIES SUI US 1,368.0 (100.7) -
TAUBMAN CENTERS TCO US 3,336.8 (256.2) -
THERAVANCE THRX US 258.8 (87.1) 199.3
UNISYS CORP UIS US 2,612.2 (1,311.0) 487.3
VECTOR GROUP LTD VGR US 927.8 (89.0) 194.5
VERISIGN INC VRSN US 1,856.2 (88.1) 788.9
VERISK ANALYTI-A VRSK US 1,541.1 (98.5) 104.0
VIRGIN MOBILE-A VM US 307.4 (244.2) (138.3)
WEIGHT WATCHERS WTW US 1,121.6 (409.8) (279.7)
WESTMORELAND COA WLB US 759.2 (249.9) (21.7)
*********
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, Ivy B. Magdadaro, Carlo
Fernandez, Christopher G. Patalinghug, and Peter A. Chapman,
Editors.
Copyright 2012. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $775 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Christopher
Beard at 240/629-3300.
*** End of Transmission ***