/raid1/www/Hosts/bankrupt/TCR_Public/120402.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, April 2, 2012, Vol. 16, No. 92
Headlines
23 EAST 39TH STREET: New York Building Owner Files for Chapter 11
3210 RIVERDALE ASSOC: Bronx Condo Project Owner Files for Ch.11
AEP INDUSTRIES: Moody's Cuts CFR to 'B2'; Outlook Stable
AES EASTERN: Files Schedules of Assets and Liabilities
AES EASTERN: WeinsweigAdvisors Approved as Financial Advisors
AHERN RENTALS: Unsecured Loan from AmEx Gets Court Approval
AHERN RENTALS: Court Approves Hiring of DLA Piper as Co-Counsel
AHERN RENTALS: Has Until July 19 to Decide on Unexpired Leases
AHERN RENTALS: Hutchison & Steffen OK'd to Prosecute Claims
AHERN RENTALS: Stuber Cooper OK'd to Handle 50 Pending Actions
ALEXANDER PROPERTIES: Bank's Response Deadline Moved to April 20
ALT HOTEL: Cash Collateral Hearing Slated for April 9
ALT HOTEL: Plan Confirmation Hearing Slated for July 23
ALTER COMMUNICATIONS: Three Bidders Vie for Jewish Times
AMARU INC: Incurs $1.4 Million Net Loss from Operations in 2011
AMBAC FINANCIAL: Has $963.2-Mil. Fourth Quarter Net Loss
AMBAC FINANCIAL: Paid $3.6-Mil. to Top Executives in 2011
AMBAC FINANCIAL: Won't Consummate Plan Pending IRS Settlement
AMEREN ENERGY: Moody's Reviews 'Ba2' Debt Rating for Downgrade
AMERICAN AIRLINES: Plan Filing Exclusivity Extended to Sept. 28
AMERICAN AIRLINES: Lease Decision Deadline Extended to June 26
AMERICAN AIRLINES: Withdraws Motion to Stay Suits vs. Non-Debtors
AMERICAN AIRLINES: Wants Lawsuits Over Benefit Plans Barred
AMERICAN ROCK SALT: S&P Puts 'B' Corp. Credit Rating on Watch Neg
AUDATEX HOLDINGS: A&E Request No Impact on Ba1 CFR, Moody's Says
AUSTIN MUTUAL: A.M. Best Cuts Financial Strength Rating to 'B'
AVIS BUDGET: DBRS Confirms 'B' Issuer Rating & Unsec. Debt Rating
BARNES BAY: Del. Super. Ct. Rules in Anguilla Re Lawsuit
BEACON POWER: Terminates Registration of Common Stock Securities
BOOMERANG SYSTEMS: Plans to Offer $10 Million of Securities
BUFFETS INC: Closed Rolling Meadows Outlet on March 25
BRAINY BRANDS: Delays Form 10-K for 2011
BROWNIE'S MARINE: Incurs $3.7 Million Net Loss in 2011
CAMBIUM LEARNING: S&P Lowers CCR to 'B-' on Sharp EBITDA Drop
CAPSALUS CORP: Delays Form 10-K for 2011
CENTENE CORP: S&P Affirms 'BB' Counterparty Credit Rating
CENTENNIAL BLUFF: Case Summary & 20 Largest Unsecured Creditors
CENTRE PLAZA INVESTORS: Files for Chapter 11 in San Antonio
CHARTER COMMS: Moody's Rates $1.1-Bil. First Lien Revolver 'Ba1'
CHARTER COMMS: Fitch Rates $1.1 Billion Credit Facility 'BB+'
CHINA EXECUTIVE: Corrects Misstatements in 2010 Report
CHINA GREEN: Delays Filing of 2011 Report
CHRYSLER LLC: Court Rules on Sec. 747 Relief for Dealers
CHURCH STREET: Files Schedules of Assets and Liabilities
CIRCUS AND ELDORADO: Suspending Filing of Reports with SEC
CITGO PETROLEUM: Ex Baltimore Convenience Store to be Auctioned
CLARE AT WATER: Creditors' Proofs of Claim Due April 20
CLARE AT WATER: Plan Confirmation Hearing Scheduled for April 24
CNL LIFESTYLE: S&P Cuts Corp. Credit Rating to 'B+' on Weak Credit
COMMERCIAL TRAVELERS: A.M. Beset Places 'B' FSR Under Review
COMMONWEALTH BIOTECH: Delays Form 10-K for 2011
COMMUNITY SHORES: Incurs $2.4 Million Net Loss in 2011
CONDOR DEVELOPMENT: Comfort Inn Washington Owner Files Chapter 11
CREDITRON FINANCIAL: Joyce Covatto Leaves Agility Marketing Group
CRYOPORT INC: Names Stephen Wasserman to Board of Directors
CST INDUSTRIES: S&P Affirms 'CCC' Corp. Credit Rating; Off Watch
CYCLONE POWER: Delays Form 10-K for 2011
D.R. HORTON: Moody's Upgrades CFR to 'Ba2'; Outlook Stable
DAIS ANALYTIC: Incurs $2.3 Million Net Loss in 2011
DIGITILITI INC: Delays Form 10-K for 2011
DARLING INT'L: S&P Raises Corporate Credit Rating to 'BB+'
DECATUR RETAIL: Case Summary & 8 Largest Unsecured Creditors
DELOS AIRCRAFT: Fitch to Rate Proposed $550-Mil. Loan at 'BB'
DELTA PETROLEUM: Plan Proposal Exclusivity Extended June 12
DELTA PETROLEUM: DIP Loan Amended to Extend Sale Deadlines
DESERT EQUIPMENT: Case Summary & 20 Largest Unsecured Creditors
DEX ONE: Moody's Cuts CFR to 'Caa3', Revises PDR to 'Ca/LD'
DILLARD'S INC: Fitch Upgrades Issuer Default Rating to 'BB+'
DIRECTBUY HOLDINGS: S&P Withdraws 'D' Corporate Credit Rating
DOLPHIN DIGITAL: Incurs $1.2 Million Net Loss in 2011
DOMMER CONSTRUCTION: Rooker-Feldman Doctrine Doesn't Appy to BFG
DUTCH GOLD: Delays Form 10-K for 2011
DYNEGY INC: Disputes Examiner's Fraudulent Transfer Finding
DYNEGY INC: WTC Wants Creditors Meeting After Trustee Named
DYNEGY INC: Hearing on More Plan Exclusivity Wednesday
E-DEBIT GLOBAL: Delays Form 10-K for 2011
EAST COAST CABLEVISION: Dist. Court Won't Stay Sky Cable Suit
EAT AT JOE'S: Incurs $152,900 Net Loss in 2011
ENERGY CONVERSION: Gets Nod to Hire Plante & Moran as Accountant
ENERGY CONVERSION: Can Hire AlixPartners as Financial Advisor
ENERGY CONVERSION: Can Hire Covington & Burling as Special Counsel
ENERGY TRANSFER: S&P Hikes Corp. Credit Ratings to 'BB'; Off Watch
EOS PREFERRED: Delays Form 10-K for 2011
EOS PREFERRED: Voluntarily Delists Preferred Shares on NASDAQ
EURAMAX INT'L: S&P Affirms 'B-' Rating on $375MM Sr. Secured Notes
EVERGREEN COUNTRY: S&P Cuts Series 2007 Revenue Bond Rating to 'D'
EZENIA INC: Plans to Move HQ to Seattle Near Microsoft
FOUNDATIONS INC: State Court Rules in Eliazer Ortiz Lawsuit
FREIF NORTH AMERICA: S&P Keeps 'BB-' Corporate Credit Rating
GENERAL MARITIME: Hearing Today on Plan Modifications
GENERAL MARITIME: Modified Plan Reduces Debt by $600 Million
GENERAL MARITIME: Seeks Approval of Plan Support Deal
GENERAL MARITIME: Modifies Plan, Asks Voting Extension to April 25
GENERAL MARITIME: Can Decide on NY Lease Assumption Until June 14
GENTA INC: Completes Financing of up to $12 Million
GOODYEAR TIRE: S&P Rates $1.2-Bil. Second Lien Term Loan 'BB'
GIBRALTAR KENTUCKY: Taps Talarchyk Merrill as Bankruptcy Counsel
GIBRALTAR KENTUCKY: US Trustee Has Not Appointed Creditors' Panel
GIBRALTAR KENTUCKY: Files Schedules of Assets and Liabilities
GRAND AVENUE: Case Summary & 9 Largest Unsecured Creditors
GREEN ENDEAVORS: Delays Form 10-K for 2011 Due to CFO's Departure
GUANGZHOU GLOBAL: Delays Filing of 2011 Report
HALO COMPANIES: Incurs $2.5 Million Net Loss in 2011
INNOVATIVE FOOD: Swings to $1.5 Million Profit in 2011
HAWKER BEECHCRAFT: To File for Chapter 11 Bankruptcy Protection
HD SUPPLY: S&P Keeps 'B' Corp. Credit Rating; Outlook Stable
INDUSTRIAL FIREDOOR: Meeting to Form Creditors' Panel on April 5
INTEGRATED ENVIRONMENTAL: Incurs $2.2 Million Net Loss in 2011
INTERNAL FIXATION: Delays Form 10-K for 2011
INTERNATIONAL FUEL: Incurs $2.5 Million Net Loss in 2011
IPS CORP: S&P Cuts Corp. Credit Rating to 'B-' on Refinancing Risk
JAMAICA DIVERSIFIED: Fitch Holds Rating on 2 Note Classes at 'BB'
JAMES D. CLYMER: Court Declines to Issue Final Decree
JAMES QUINLAN: Court Wants Changes to Plan Outline
JIM PALMER: Chapter 7 Trustee Settles Lawsuit Over Sale
LEVEL 3: Fitch Upgrades Issuer Default Rating to 'B'
LPATH INC: Amends Form S-1; To Offer 12.5 Million Units
LSP ENERGY: Moody's Withdraws 'Caa3' Rating on Sr. Secured Bonds
M WAIKIKI: Court Denies Marriott's Plea on Estimation Hearing
M.D.C. HOLDINGS: Moody's Issues Summary Credit Opinion
MANITOWOC COMPANY: Moody's Changes Rating Outlook to Positive
MECHEL OAO: Commences Discussions With Lenders, Seeks Waivers
MEDCLEAN TECHNOLOGIES: Delays Form 10-K for 2011
MEDICAL BILLING: Incurs $6.5 Million Net Loss in 2011
MEDICAL CONNECTIONS: Incurs $3.7 Million Net Loss in 2011
MILLAR WESTERN: S&P Affirms 'B-' Corp. Credit Rating; Outlook Neg
MMRGLOBAL INC: Incurs $8.8 Million Net Loss in 2011
NATIONSTAR MORTGAGE: S&P Raises Counterparty Credit Rating to 'B'
NEBRASKA BOOK: Amended Plan Support Agreement Approved
NEOMEDIA TECHNOLOGIES: Delays Form 10-K for 2011
NETWORK CN: Delays Form 10-K for 2011
NEXTMEDIA OPERATING: S&P Affirms 'B-' Corporate Credit Rating
NORTEL NETWORKS: Davis Polk, et al., OK'd as Mediator's Advisors
NOVA CHEMICALS: S&P Hikes Corp. Credit Rating to 'BB'; Outlook Pos
OMNICARE INC: S&P Gives 'BB' Rating on $390MM Sr. Sub. Notes
OXYSURE SYSTEMS: Incurs $1.53 Million Net Loss in 2011
PACER MANAGEMENT: Case Summary & 20 Largest Unsecured Creditors
PERRY ELLIS: Moody's Affirms 'B1' Corporate Family Rating
PFLEIDERER AG: Fitch Downgrades Issuer Default Rating to 'D'
PHH CORP: S&P Cuts Subordinated Shelf Registration Rating to 'B'
PHILADELPHIA ORCHESTRA: Wants to Earmark $3MM to Cover Dues
PINNACLE AIRLINES: Files for Chapter 11 to Gain Turnaround
PINNACLE AIRLINES: Voluntary Chapter 11 Case Summary
POSITRON CORP: Delays Form 10-K for 2011
POWER EFFICIENCY: Incurs $3.6 Million Net Loss in 2011
PRESIDENTIAL REALTY: Delays Form 10-K for 2011
PROPER POWER: Delays Form 10-K for 2011
PROTEONOMIX INC: Incurs $1.38 Million Net Loss in 2011
PQ CORP: S&P Rates $200MM 1st Lien Term Loan B+; Outlook Negative
PREFERRED PROPPANTS: S&P Affirms 'B+' Corporate Credit Rating
PROELITE INC: Delays Form 10-K for 2011
PROQUEST LLC: Moody's Rates $190-Mil. Credit Facility 'Ba3'
PROQUEST LLC: S&P Rates New $190MM 1st Lien Credit Facilities 'B+'
REAL ESTATE ASSOCIATES: Incurs $861,000 Net Loss in 2011
REAL ESTATE ASSOCIATES: Assigns Interests in Ark. City & Oakview
RICKY MURRAY: Bankr. Court Says Chapter 11 Plan Not Feasible
ROSEMONT COPPER: Concealed Corporate Bankruptcy of 2 Officers
RYERSON HOLDINGS: S&P Affirms 'B-' Corporate Credit Rating
SAINT VINCENTS: Richard S. Toder Appointed as Mediator
SAKS INC: Fitch Upgrades Issuer Default Rating to 'BB'
SCI ENGINEERED: Unable to Timely File Form 10-K
SINO-FOREST: Initiates CCAA Proceeding for Sale/Restructuring
SINO-FOREST: Initiates Sale Solicitation Process
SINO-FOREST: Obtains Initial CCAA Stay Order; FTI Is Monitor
SKILLED HEALTHCARE: S&P Gives 'B' on $100-Mil. Sr. Term Loan
SOUTHEASTERN MATERIALS: Bankr. Court Has Jurisdiction on DLI Case
SOUTHERN SKY: Chapter 11 Filing to Cost Airport $850,000 Funding
SOUTHERN SKY: Management Conducts Forensic Investigation
SPIRIT AEROSYSTEMS: S&P Retains 'BB' Corporate Credit Rating
STATE FAIR OF VIRGINIA: Trustee Plans Auction in May
SUPERMEDIA INC: Moody's Cuts Corporate Family Rating to 'Caa3'
T3 MOTION: Incurs $5.5 Million Net Loss in 2011
TEXTRON FINANCIAL: S&P Puts 'BB+/B' Issuer Credit Ratings on Watch
THERAPEUTICSMD INC: Rosenberg Rich Raises Going Concern Doubt
THOR INDUSTRIES: Files Chapter 11 Petition in Greenville
TIMMINCO LIMITED: First Phase of Marketing Process Completed
TOWNSQUARE RADIO: S&P Assigns B Corp Credit Rating; Outlook Stable
TRAINOR GLASS: Has Interim Access to $300,000 FMB DIP Facility
TRANS-LUX CORP: Delays Form 10-K for 2011
UNIVERSAL FIDELITY: A.M. Best Cuts Finc'l. Strength Rating to 'B'
UNIVERSAL SOLAR: Delays Form 10-K for 2011
USA BABY: 7th Cir. Rejects Shareholder's Appeals
USG CORP: Moody's Rates Proposed $250MM Sr. Unsecured Notes 'B2'
USG CORP: S&P Rates New $250-Mil. Senior Unsecured Notes 'BB-'
USG CORP: Fitch Rates $250 Million Sr. Unsecured Notes at 'B+/RR2'
VANGUARD HEALTH: S&P Rates $375-Mil. Senior Notes 'B-'
VANTIV LLC: S&P Lifts Corp. Credit Rating to BB; Outlook Positive
VERMILLION INC: PwC Raises Going Concern Doubt
VERTRUE LLC: S&P Withdraws 'D' Corp. Credit Rating on Lack of Info
VULCAN MATERIALS: S&P Keeps 'BB' Corp. Credit Rating on Watch Pos
W.R. GRACE: Bryan Cave HRO Succeeds Holme Roberts as Counsel
W.R. GRACE: Nat'l Indemnity Sues Montana Over Asbestos Settlement
W.R. GRACE: Board Approves Incentive Compensation Program
WAVE SYSTEMS: Incurs $4.8 Million Net Loss in Fourth Quarter
WESTAIM CORP: A.M. Best Raises Issuer Credit Rating from 'bb'
WORLDGATE COMMUNICATIONS: To Liquidate Under Chapter 7
ZENAIDA POSTOLICA: Rosamond Property Worth $90,745
ZOO ENTERTAINMENT: Delays Form 10-K for 2011
* Moody's Lifts Apparel Industry Outlook to Positive
* BOND PRICING -- For Week From March 26 to 30, 2012
*********
23 EAST 39TH STREET: New York Building Owner Files for Chapter 11
-----------------------------------------------------------------
23 East 39th Street Developers LLC filed a Chapter 11 petition
(Bankr. S.D.N.Y. Case No. 12-11304) on March 30, 2012.
The schedules of assets and liabilities, the statement of
financial affairs, and incomplete filings are due April 13, 2012.
The Chapter 11 Plan and explanatory disclosure statement are due
July 30, 2012.
The Debtor estimated assets and debts of $10 million to
$50 million as of the Chapter 11 filing.
According to a state court filing, the Debtor bought in October
2007 a building on 23 East 39th Street in Bronx, New York, from
entity 23 East 39th Street Management Corp. Subsequent to the
sale, Management leased the property from the Debtor and
subsequently vacated the property in May 2008.
A June 2009 post by http://www.loopnet.com/the building is/was
available for sale for $16.5 million. The property has two luxury
residential dwellings in addition to five stories of commercial
space. The six-story building has 11,649 square feet of space.
James O. Guy, Esq., in Clifton Park, New York, serves as counsel
to the Debtor.
3210 RIVERDALE ASSOC: Bronx Condo Project Owner Files for Ch.11
---------------------------------------------------------------
3210 Riverdale Associates LLC filed a Chapter 11 petition (Bankr.
S.D.N.Y. Case No. 12-11286) on March 29, 2012.
The Debtor, a Single Asset Real Estate as defined in 11 U.S.C. Sec
101 (51B), owns a property in 3210 Riverdale Avenue, in Bronx, New
York. The Debtor estimated assets and debts are up to
$50 million.
According to the list of creditors, the Debtor has a 30 million
secured debt to 3210 Riverdale Avenue Partners and HSBC Capital.
A March 20, 2012 report by The Real Deal says that HSBC Capital
sought a sale of the property following a defaulted mezzanine loan
for the Bronx condominium project. The owner of the Debtor,
developer Michael Waldman, filed a $40 million lawsuit to block
the sale. Mr. Waldman, a boutique developer behind Harlem's
Walden, alleges that HSBC was engaged in fraud and predatory
lending after cutting funding on a construction loan.
According to the docket, the schedules of assets and liabilities,
statement financial affairs and incomplete filings are due to be
filed with the Bankruptcy Court by April 12, 2012. The Chapter 11
plan and the explanatory disclosure statement are due July 27,
2012.
AEP INDUSTRIES: Moody's Cuts CFR to 'B2'; Outlook Stable
--------------------------------------------------------
Moody's Investors Service downgraded the corporate family rating
of AEP Industries Inc to B2 from B1 and revised the rating outlook
to stable. Additional rating actions are detailed below.
Moody's took the following actions for AEP Industries, Inc:
Corporate Family Rating downgraded to B2 from B1
Probability of Default Rating downgraded to B2 from B1
$200 million senior notes due 2019, downgraded to B3 (LGD 5, 74%)
from B2 (LGD 5, 73%)
Revised outlook to stable from negative.
Ratings Rationale
The downgrade to B2 from B1 reflects the challenging competitive
environment, weakness in certain credit metrics, commoditized
product line, and lack of long-term contracts with cost pass
throughs. AEP's EBIT margin and free cash flow to debt are weak
for the rating category and below the rating triggers (even when
excluding debt for the recent Webster acquisition). The industry
remains fragmented with excess capacity and strong price
competition which is likely to make it difficult for the company
to improve credit metrics to a level commensurate with the rating
category over the intermediate term. Although AEP was able to push
through some price increases and gain some market share in 2011,
these achievements failed to improve metrics to a level consistent
with the rating category. The company's willingness to exit lower-
margin business confirms its focus on profitability, but further
highlights the difficult competitive environment. Free cash flow
may also be negatively impacted over the intermediate term as NOLs
are exhausted. Additionally, the integration of the recent Webster
acquisition carries some risk and could have a material impact on
near-term credit metrics given the required capital spending and
reliance on synergies to reverse operating losses and generate
profits.
AEP's B2 Corporate Family Rating reflects the company's exposure
to a fragmented market with significant price competition and
overcapacity and exposure to some cyclical end markets. The
company's operating margins remain weak for the rating category
and may continue to be negatively impacted by the competitive
environment. The rating also reflects the predominance of
commodity products and dearth of long-term contracts with cost
pass through provisions with customers.
The rating is supported by certain credit metrics that provide
some cushion in the rating category (leverage) as well as strong
liquidity. Additionally, the company's continuing focus on
profitability and cost-cutting also help support the rating.
Strengths in the credit profile also include a high percentage of
packaging for food products, scale relative to most competitors
and strong liquidity.
The principal methodology used in rating AEP was the Global
Packaging Manufacturers: Metal, Glass, and Plastic Containers
Industry Methodology published in June 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.
AES EASTERN: Files Schedules of Assets and Liabilities
------------------------------------------------------
AES Eastern Energy, L.P., filed the U.S. Bankruptcy Court for the
District of Delaware its schedules of assets and liabilities,
disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $0
B. Personal Property $2,638,913,332
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $0
E. Creditors Holding
Unsecured Priority
Claims $0
F. Creditors Holding
Unsecured Non-priority
Claims $26,272,435
------------ ----------
TOTAL $2,638,913,332 $26,272,435
A full-text copy of the schedules is available for free at
http://bankrupt.com/misc/AES_EASTERN_sal.pdf
About AES Eastern
Ithaca, New York-based AES Eastern Energy, L.P., either directly
or indirectly, control six coal-fired electric generating plants
located in New York State. Currently, the Debtors actively
operate two of the six power plants and sell the electricity
generated by those plants into the New York wholesale power market
to utilities and other intermediaries under short-term agreements
or directly in the spot market.
AES Eastern Energy and 13 affiliates filed for Chapter 11
bankruptcy (Bankr. D. Del. Case Nos. 11-14138 through 11-14151) on
Dec. 30, 2011. AES Eastern Energy estimated $100 million to $500
million in assets and $500 million to $1 billion in debts.
Lawyers at Weil, Gotshal & Manges LLP and Richards, Layton &
Finger, P.A., are legal counsel to AES Eastern Energy and
affiliates. WeinsweigAdvisors, L.L.C., is assisting the Debtors
with financial management. Barclays Capital Inc., is assisting in
the sale process. Kurtzman Carson Consultants is the claims and
noticing agent.
Gregory A. Horowith, Esq., and Robert T. Schmidt, Esq., at Kramer,
Levin, Naftalis & Frankel LLP; and William T. Bowden, Esq.,
Benjamin W. Keenan, Esq., and Karen B. Skomorucha, Esq., at Ashby
& Geddes, P.A., serve as counsel to the Creditors Committee. FTI
Consulting Inc. is the financial advisor.
AES EASTERN: WeinsweigAdvisors Approved as Financial Advisors
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
AES Eastern Energy, L.P., et al., to employ WeinsweigAdvisors,
L.L.C., nunc pro tunc to Feb. 8, 2012, as financial advisors and
consultants.
As reported in the Troubled Company Reporter on March 16, 2012,
Weinsweig has agreed to, among other things:
a. assist in preparing statements of financial affair,
schedule of assets and liabilities, monthly operating
reports, and other similar disclosures;
b. update the 13-week cash flow forecast; and
c. assist with general financial management of the Debtors.
The Debtors assure the Court that there will be no duplication of
services being provided by Barclays Capital, Inc., an investment
bank already retained by the Debtors, and Weinsweig. Barclays is
focused on the sale and marketing of the Debtors' assets, while
Weinsweig is supporting those efforts. Weinsweig will assist the
Debtors with general business disclosures, financial management,
and due diligence, and will be focusing on short-term week-to-week
cash flow forecasts. Barclays, in contrast, has been working with
the Debtors on a long-term financial model more pertinent to the
sale process, and has been coordinating the marketing and sale
process. Weinsweig will additionally be working with financial
advisors to the Creditors' Committee as their point of contact to
ensure a smooth information flow between the Debtors and the
Committee.
The Debtors will pay Weinsweig for its services on a monthly fixed
fee basis at the rate of $45,000 per month for the work of one
managing director, Chris Stevens. In addition, the Debtors will
pay a one-time fee of $54,000 for 120 hours of the assistance of
Marc Weinsweig, the principal and founder of Weinsweig.
Mr. Weinsweig assures the Court that the firm is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.
About AES Eastern
Ithaca, New York-based AES Eastern Energy, L.P., either directly
or indirectly, control six coal-fired electric generating plants
located in New York State. Currently, the Debtors actively
operate two of the six power plants and sell the electricity
generated by those plants into the New York wholesale power market
to utilities and other intermediaries under short-term agreements
or directly in the spot market.
AES Eastern Energy and 13 affiliates filed for Chapter 11
bankruptcy (Bankr. D. Del. Case Nos. 11-14138 through 11-14151) on
Dec. 30, 2011. Lawyers at Weil, Gotshal & Manges LLP and
Richards, Layton & Finger, P.A., are legal counsel to AES Eastern
Energy and affiliates. Barclays Capital is serving as investment
banker and financial advisor. Kurtzman Carson Consultants is the
claims and noticing agent. AES Eastern Energy estimated
$100 million to $500 million in assets and $500 million to
$1 billion in debts. The petition was signed by Peter Norgeot,
general manager.
Gregory A. Horowith, Esq., and Robert T. Schmidt, Esq., at Kramer,
Levin, Naftalis & Frankel LLP; and William T. Bowden, Esq.,
Benjamin W. Keenan, Esq., and Karen B. Skomorucha, Esq., at Ashby
& Geddes, P.A., serve as counsel to the Creditors Committee. FTI
Consulting Inc. is the financial advisor.
AES Eastern Energy prevailed over opposition and obtained
authorization to hold a March 26 auction for the two operating
power plants. Under a deal reached prepetition, the Debtor would
turn the two operating facilities over to debt holders in exchange
for debt, absent higher and better offers.
AHERN RENTALS: Unsecured Loan from AmEx Gets Court Approval
-----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Nevada authorized
Ahern Rentals, Inc. to obtain postpetition unsecured debt from
American Express Travel Related Services Company, Inc.
As reported in the Troubled Company Reporter on March 16, 2012,
prior to the Petition Date, the Debtor maintained various credit
card accounts with American Express pursuant to a Corporate
Services Commercial Account Agreement. The Debtor uses FedEx and
UPS's transportation and delivery services to deliver equipment
parts and supplies to and from its customers and branch stores
across the country. The Debtor's sole purpose in maintaining the
AMEX Accounts is to pay FedEx and UPS shipping and delivery
charges.
In December 2011, Debtor wired $100,000 to AMEX with instructions
to immediately pay pending charges on the AMEX Accounts. At the
time of the Wire, there was approximately $50,000 of charges
posted or pending on Debtor's AMEX Accounts, due to FedEx and UPS.
Accordingly, the excess Wire amount should have been applied to
Debtor's AMEX Accounts as a credit.
After the Petition Date, AMEX froze the Debtor's AMEX Accounts.
The Debtor believes AMEX will agree to unfreeze the AMEX Accounts,
apply the Wire to the outstanding charges on the AMEX Accounts,
and provide Debtor postpetition financing under the AMEX Contract,
contingent upon the entry of an order of the Bankruptcy Court.
FedEx has indicated it may not continue providing services to the
Debtor if its charges are not paid. Therefore, the Debtor
believed the application of the Wire to the balance of the
prepetition charges and Debtor's continued postpetition, ordinary
course use of the AMEX Accounts are necessary and in the best
interest of the estate and creditors.
Kirk D. Homeyer, Esq., at Gordon Silver, submitted that the Debtor
has exercised prudent business judgment in determining to continue
to obtain credit under the AMEX Contract on a postpetition basis,
as such postpetition financing will benefit Debtor's estate, not
to mention Debtor's business operations and relationship with its
customers. If the Debtor cannot obtain postpetition financing
under the AMEX Contract, the Debtor's estate risks losing a
valuable, mutually-beneficial business relationship with FedEx.
Without FedEx's services, the Debtor will be hindered in shipping
parts and equipment to its customers and branch stores, thereby
jeopardizing customer relationships and Debtor's overall revenue.
The Debtor submits that it has established that postpetition
credit under the AMEX Contract will benefit the estate and is
properly within the Debtor's business judgment.
About Ahern Rentals
Founded in 1953 with one location in Las Vegas, Nevada, Ahern
Rentals Inc. -- http://www.ahern.com/-- now offers rental
equipment to customers through its 74 locations in Arizona,
Arkansas, California, Colorado, Georgia, Kansas, Maryland,
Nebraska, Nevada, New Jersey, New Mexico, North Carolina, North
Dakota, Oklahoma, Oregon, Pennsylvania, South Carolina, Tennessee,
Texas, Utah, Virginia and Washington.
Ahern Rentals filed a voluntary Chapter 11 petition (Bankr. D.
Nev. Case No. 11-53860) on Dec. 22, 2011, after failing to obtain
an extension of the Aug. 21, 2011 maturity of its revolving credit
facility. Judge Bruce T. Beesley presides over the case. Lawyers
at Gordon Silver serve as the Debtor's counsel. The Debtor's
financial advisors are Oppenheimer & Co. and The Seaport Group.
Kurtzman Carson Consultants LLC serves as claims and notice agent.
Counsel to Bank of America, as the DIP Agent and First Lien Agent,
are Albert M. Fenster, Esq., and Marc D. Rosenberg, Esq., at Kaye
Scholer LLP, and Robert R. Kinas, Esq., at Snell & Wilmer.
Attorneys for the Majority Term Lenders are Paul Aronzon, Esq.,
and Robert Jay Moore, Esq., at Milbank, Tweed, Hadley & McCloy
LLP. Counsel for the Majority Second Lienholder are Paul V.
Shalhoub, Esq., Joseph G. Minias, Esq., and Ana M. Alfonso, Esq.,
at Willkie Farr & Gallagher LLP. Attorney for GE Capital is James
E. Van Horn, Esq., at McGuirewoods LLP. Wells Fargo Bank is
represented by Andrew M. Kramer, Esq., at Otterbourg, Steindler,
Houston & Rosen, P.C. Allan S. Brilliant, Esq., and Glenn E.
Siegel, Esq., at Dechert LLP argue for certain revolving lenders.
Attorneys for U.S. Bank National Association, as successor to
Wells Fargo Bank, as collateral agent and trustee for the benefit
of holders of the 9-1/4% Senior Secured Notes Due 2013 under the
Indenture dated Aug. 18, 2005, is Kyle Mathews, Esq., at Sheppard,
Mullin, Richter & Hampton LLP and Timothy Lukas, Esq., at Holland
& Hart.
In its schedules, the Debtor disclosed $485,807,117 in assets and
$649,919,474 in liabilities.
The Official Committee of Unsecured Creditors has tapped Covington
& Burling LLP as counsel, Downey Brand LLP as local counsel, and
FTI Consulting as financial advisor.
AHERN RENTALS: Court Approves Hiring of DLA Piper as Co-Counsel
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Nevada authorized
Ahern Rentals, Inc., to employ DLA Piper LLP (US) as the Debtor's
co-counsel, effective as of Jan. 15, 2012.
As reported in the Troubled Company Reporter on Feb. 17, 2012, as
co-counsel, DLA will:
1. advise the Debtor with respect to its powers and duties as
debtor and debtor-in-possession in the continued management
and operation of its business and properties;
2. prepare, on behalf of the Debtor, motions, applications,
answers, orders, reports, and papers necessary to the
administration of the estate;
3. prepare and negotiate on the Debtor's behalf a plan of
reorganization, disclosure statement, and all related
agreements and documents, and taking any necessary action on
behalf of the Debtor to obtain confirmation of a plan; and
4. perform other necessary legal services and provide other
necessary legal advice to the Debtor in connection with its
Chapter 11 case.
To the best of the Debtor's knowledge, the partners, counsel, and
associates of DLA are "disinterested persons" as that term is
defined in Bankruptcy Code Section 101(14).
As compensation for their services, DLA professionals bill at
these hourly rates:
Partners $530 - $1,120
Counsel $300 - $940
Associates $320 - $730
Para-professionals $85 - $455
The attorney leading the DLA engagement is Mr. Galardi whose
present hourly rate is $975.
About Ahern Rentals
Ahern Rentals, Inc. -- http://www.ahern.com/-- is an equipment
rental company with locations primarily in the southwestern United
States. Founded in 1953 with one location in Las Vegas, Nevada,
Ahern now offers rental equipment to customers through its 74
locations in Arizona, Arkansas, California, Colorado, Georgia,
Kansas, Maryland, Nebraska, Nevada, New Jersey, New Mexico, North
Carolina, North Dakota, Oklahoma, Oregon, Pennsylvania, South
Carolina, Tennessee, Texas, Utah, Virginia and Washington.
Ahern Rentals filed a voluntary Chapter 11 petition (Bankr. D.
Nev. Case No. 11-53860) on Dec. 22, 2011, after failing to obtain
an extension of the Aug. 21, 2011 maturity of its revolving credit
facility. Judge Bruce T. Beesley presides over the case. Lawyers
at Gordon Silver serve as the Debtor's counsel. The Debtor's
financial advisors are Oppenheimer & Co. and The Seaport Group.
Kurtzman Carson Consultants LLC serves as claims and notice agent.
Counsel to Bank of America, as the DIP Agent and First Lien Agent,
are Albert M. Fenster, Esq., and Marc D. Rosenberg, Esq., at Kaye
Scholer LLP, and Robert R. Kinas, Esq., at Snell & Wilmer.
Attorneys for the Majority Term Lenders are Paul Aronzon, Esq.,
and Robert Jay Moore, Esq., at Milbank, Tweed, Hadley & McCloy
LLP. Counsel for the Majority Second Lienholder are Paul V.
Shalhoub, Esq., Joseph G. Minias, Esq., and Ana M. Alfonso, Esq.,
at Willkie Farr & Gallagher LLP. Attorney for GE Capital is James
E. Van Horn, Esq., at McGuirewoods LLP. Wells Fargo Bank is
represented by Andrew M. Kramer, Esq., at Otterbourg, Steindler,
Houston & Rosen, P.C. Allan S. Brilliant, Esq., and Glenn E.
Siegel, Esq., at Dechert LLP argue for certain revolving lenders.
Attorneys for U.S. Bank National Association, as successor to
Wells Fargo Bank, as collateral agent and trustee for the benefit
of holders of the 9-1/4% Senior Secured Notes Due 2013 under the
Indenture dated Aug. 18, 2005, is Kyle Mathews, Esq., at Sheppard,
Mullin, Richter & Hampton LLP and Timothy Lukas, Esq., at Holland
& Hart.
The Company filed for Chapter 11 because it was unable to extend
the maturity of its revolving credit facility. In its schedules,
the Debtor disclosed $485,807,117 in assets and $649,919,474 in
liabilities.
The Official Committee of Unsecured Creditors has tapped Covington
& Burling LLP as counsel, Downey Brand LLP as local counsel, and
FTI Consulting as financial advisor.
AHERN RENTALS: Has Until July 19 to Decide on Unexpired Leases
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Nevada extended
until July 19, 2012, Ahern Rentals, Inc.'s time to assume or
reject unexpired leases for non-residential real property.
As reported in the Troubled Company Reporter on Feb. 20, 2012, the
Debtor explained that "premises nonresidential leases" are
critical to the continued operation of its business. The Debtor
notes that as the chapter 11 case is not yet two months old, the
Debtor has not had sufficient time to formulate a plan of
reorganization.
The Debtor said that it cannot complete the analysis of 100
nonresidential leases by April 20, 2012.
About Ahern Rentals
Ahern Rentals, Inc. -- http://www.ahern.com/-- is an equipment
rental company with locations primarily in the southwestern United
States. Founded in 1953 with one location in Las Vegas, Nevada,
Ahern now offers rental equipment to customers through its 74
locations in Arizona, Arkansas, California, Colorado, Georgia,
Kansas, Maryland, Nebraska, Nevada, New Jersey, New Mexico, North
Carolina, North Dakota, Oklahoma, Oregon, Pennsylvania, South
Carolina, Tennessee, Texas, Utah, Virginia and Washington.
Ahern Rentals filed a voluntary Chapter 11 petition (Bankr. D.
Nev. Case No. 11-53860) on Dec. 22, 2011, after failing to obtain
an extension of the Aug. 21, 2011 maturity of its revolving credit
facility. Judge Bruce T. Beesley presides over the case. Lawyers
at Gordon Silver serve as the Debtor's counsel. The Debtor's
financial advisors are Oppenheimer & Co. and The Seaport Group.
Kurtzman Carson Consultants LLC serves as claims and notice agent.
Counsel to Bank of America, as the DIP Agent and First Lien Agent,
are Albert M. Fenster, Esq., and Marc D. Rosenberg, Esq., at Kaye
Scholer LLP, and Robert R. Kinas, Esq., at Snell & Wilmer.
Attorneys for the Majority Term Lenders are Paul Aronzon, Esq.,
and Robert Jay Moore, Esq., at Milbank, Tweed, Hadley & McCloy
LLP. Counsel for the Majority Second Lienholder are Paul V.
Shalhoub, Esq., Joseph G. Minias, Esq., and Ana M. Alfonso, Esq.,
at Willkie Farr & Gallagher LLP. Attorney for GE Capital is James
E. Van Horn, Esq., at McGuirewoods LLP. Wells Fargo Bank is
represented by Andrew M. Kramer, Esq., at Otterbourg, Steindler,
Houston & Rosen, P.C. Allan S. Brilliant, Esq., and Glenn E.
Siegel, Esq., at Dechert LLP argue for certain revolving lenders.
Attorneys for U.S. Bank National Association, as successor to
Wells Fargo Bank, as collateral agent and trustee for the benefit
of holders of the 9-1/4% Senior Secured Notes Due 2013 under the
Indenture dated Aug. 18, 2005, is Kyle Mathews, Esq., at Sheppard,
Mullin, Richter & Hampton LLP and Timothy Lukas, Esq., at Holland
& Hart.
The Company filed for Chapter 11 because it was unable to extend
the maturity of its revolving credit facility. In its schedules,
the Debtor disclosed $485,807,117 in assets and $649,919,474 in
liabilities.
The Official Committee of Unsecured Creditors has tapped Covington
& Burling LLP as counsel, Downey Brand LLP as local counsel, and
FTI Consulting as financial advisor.
AHERN RENTALS: Hutchison & Steffen OK'd to Prosecute Claims
-----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Nevada authorized
Ahern Rentals, Inc., to employ Hutchison & Steffen, LLC, as its
special counsel to provide legal services with regard to certain
litigation actions and to provide legal services as general
corporate counsel, nunc pro tunc to Jan. 26, 2012. The Debtor
also requested that the Court authorize the Debtor's payment of a
$75,000 retainer.
As reported in the Troubled Company Reporter on Feb. 20, 2012,
H&S, among others, is expected to:
1. complete any necessary litigation to liquidate the amount of
any claims associated with the pending actions;
2. prosecute any claims, counterclaims or third party claims of
Debtor that are associated with the Pending Actions;
3. assist Gordon Silver with any necessary claim objection
litigation that Debtor believes will be more effective for
H&S to handle, given H&S's expertise in the typical claims
brought against the Debtor;
4. advise the Debtor regarding the corporate implementation of
any restructuring, including the documentation related
thereto; and
5. advise regarding corporate matters related to the ongoing
operations and structure of Debtor where such issues are not
more easily addressed by other professional.
To the best of its knowledge, H&S does not hold or represent any
interest that would impair H&S's ability to objectively perform
the services contemplated herein, nor will H&S hold or represent
any interest that would impair H&S's ability to objectively
perform the services contemplated herein.
H&S's Las Vegas rates vary from $215 per hour to $725 per hour.
Joseph S. Kistler will be the senior partner regarding Debtor's
matters.
About Ahern Rentals
Ahern Rentals, Inc. -- http://www.ahern.com/-- is an equipment
rental company with locations primarily in the southwestern United
States. Founded in 1953 with one location in Las Vegas, Nevada,
Ahern now offers rental equipment to customers through its 74
locations in Arizona, Arkansas, California, Colorado, Georgia,
Kansas, Maryland, Nebraska, Nevada, New Jersey, New Mexico, North
Carolina, North Dakota, Oklahoma, Oregon, Pennsylvania, South
Carolina, Tennessee, Texas, Utah, Virginia and Washington.
Ahern Rentals filed a voluntary Chapter 11 petition (Bankr. D.
Nev. Case No. 11-53860) on Dec. 22, 2011, after failing to obtain
an extension of the Aug. 21, 2011 maturity of its revolving credit
facility. Judge Bruce T. Beesley presides over the case. Lawyers
at Gordon Silver serve as the Debtor's counsel. The Debtor's
financial advisors are Oppenheimer & Co. and The Seaport Group.
Kurtzman Carson Consultants LLC serves as claims and notice agent.
Counsel to Bank of America, as the DIP Agent and First Lien Agent,
are Albert M. Fenster, Esq., and Marc D. Rosenberg, Esq., at Kaye
Scholer LLP, and Robert R. Kinas, Esq., at Snell & Wilmer.
Attorneys for the Majority Term Lenders are Paul Aronzon, Esq.,
and Robert Jay Moore, Esq., at Milbank, Tweed, Hadley & McCloy
LLP. Counsel for the Majority Second Lienholder are Paul V.
Shalhoub, Esq., Joseph G. Minias, Esq., and Ana M. Alfonso, Esq.,
at Willkie Farr & Gallagher LLP. Attorney for GE Capital is James
E. Van Horn, Esq., at McGuirewoods LLP. Wells Fargo Bank is
represented by Andrew M. Kramer, Esq., at Otterbourg, Steindler,
Houston & Rosen, P.C. Allan S. Brilliant, Esq., and Glenn E.
Siegel, Esq., at Dechert LLP argue for certain revolving lenders.
Attorneys for U.S. Bank National Association, as successor to
Wells Fargo Bank, as collateral agent and trustee for the benefit
of holders of the 9-1/4% Senior Secured Notes Due 2013 under the
Indenture dated Aug. 18, 2005, is Kyle Mathews, Esq., at Sheppard,
Mullin, Richter & Hampton LLP and Timothy Lukas, Esq., at Holland
& Hart.
The Company filed for Chapter 11 because it was unable to extend
the maturity of its revolving credit facility. In its schedules,
the Debtor disclosed $485,807,117 in assets and $649,919,474 in
liabilities.
The Official Committee of Unsecured Creditors has tapped Covington
& Burling LLP as counsel, Downey Brand LLP as local counsel, and
FTI Consulting as financial advisor.
AHERN RENTALS: Stuber Cooper OK'd to Handle 50 Pending Actions
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Nevada authorized
Ahern Rentals, Inc., to employ Stuber Cooper Voge, PLLC as special
counsel.
As reported in the Troubled Company Reporter on Feb. 20, 2012, SCV
will provide legal services with regard to certain actions pending
as of the filing of the Debtor's case.
As of the Petition Date, SCV was handling approximately 50 pending
actions involving Debtor in various stages of litigation. The
Pending Actions include breach of contract and conversion claims
against Debtor's customers and personal guarantors to collect past
due invoices for equipment rentals and lost/stolen equipment.
Specifically, SCV will: (1) prosecute existing claims that may
bring assets into the estate; (2) commence new actions similar to
the Pending Actions; and (3) to litigate any of the Pending
Actions in the event any Pending Action gives rise to any claim
that needs to be liquidated.
To the best of its knowledge, SCV and its attorneys do not have
any connection with, or any interest adverse to, the Debtor,
Debtor's creditors, or any other party in interest, or their
respective attorneys and accountants, the United States trustee,
or any person employed in the office of the United States trustee
with respect to the matters on which SCV is to be retained or
employed in this Chapter 11 Case. Additionally, SCV does not
represent or hold any interest adverse to the Debtor or to the
estate with respect to the Pending Actions.
The firm's current hourly rates are as follows: $280 to $295 per
hour for partners; $175 to $250 per hour for associates, and $95
to $145 per hour for paralegals, subject to change from time to
time as provided for in the Engagement Letter, and all subject to
application to, and approval by, the Court. Mr. Jamey L. Voge
will primarily be responsible for providing the services
contemplated herein and his current hourly rate is $295.
About Ahern Rentals
Ahern Rentals, Inc. -- http://www.ahern.com/-- is an equipment
rental company with locations primarily in the southwestern United
States. Founded in 1953 with one location in Las Vegas, Nevada,
Ahern now offers rental equipment to customers through its 74
locations in Arizona, Arkansas, California, Colorado, Georgia,
Kansas, Maryland, Nebraska, Nevada, New Jersey, New Mexico, North
Carolina, North Dakota, Oklahoma, Oregon, Pennsylvania, South
Carolina, Tennessee, Texas, Utah, Virginia and Washington.
Ahern Rentals filed a voluntary Chapter 11 petition (Bankr. D.
Nev. Case No. 11-53860) on Dec. 22, 2011, after failing to obtain
an extension of the Aug. 21, 2011 maturity of its revolving credit
facility. Judge Bruce T. Beesley presides over the case. Lawyers
at Gordon Silver serve as the Debtor's counsel. The Debtor's
financial advisors are Oppenheimer & Co. and The Seaport Group.
Kurtzman Carson Consultants LLC serves as claims and notice agent.
Counsel to Bank of America, as the DIP Agent and First Lien Agent,
are Albert M. Fenster, Esq., and Marc D. Rosenberg, Esq., at Kaye
Scholer LLP, and Robert R. Kinas, Esq., at Snell & Wilmer.
Attorneys for the Majority Term Lenders are Paul Aronzon, Esq.,
and Robert Jay Moore, Esq., at Milbank, Tweed, Hadley & McCloy
LLP. Counsel for the Majority Second Lienholder are Paul V.
Shalhoub, Esq., Joseph G. Minias, Esq., and Ana M. Alfonso, Esq.,
at Willkie Farr & Gallagher LLP. Attorney for GE Capital is James
E. Van Horn, Esq., at McGuirewoods LLP. Wells Fargo Bank is
represented by Andrew M. Kramer, Esq., at Otterbourg, Steindler,
Houston & Rosen, P.C. Allan S. Brilliant, Esq., and Glenn E.
Siegel, Esq., at Dechert LLP argue for certain revolving lenders.
Attorneys for U.S. Bank National Association, as successor to
Wells Fargo Bank, as collateral agent and trustee for the benefit
of holders of the 9-1/4% Senior Secured Notes Due 2013 under the
Indenture dated Aug. 18, 2005, is Kyle Mathews, Esq., at Sheppard,
Mullin, Richter & Hampton LLP and Timothy Lukas, Esq., at Holland
& Hart.
The Company filed for Chapter 11 because it was unable to extend
the maturity of its revolving credit facility. In its schedules,
the Debtor disclosed $485,807,117 in assets and $649,919,474 in
liabilities.
The Official Committee of Unsecured Creditors has tapped Covington
& Burling LLP as counsel, Downey Brand LLP as local counsel, and
FTI Consulting as financial advisor.
ALEXANDER PROPERTIES: Bank's Response Deadline Moved to April 20
----------------------------------------------------------------
Bankruptcy Judge Nancy V. Alquist signed off on a sixth
stipulation extending the time for The Patapsco Bank to respond to
the motion of Alexander Properties, L.L.C., for stay pending
appeal of the order denying approval of disclosure statement to
April 20, 2012. A copy of the Sixth Stipulation dated March 28,
2012, is available at http://is.gd/if1QxZfrom Leagle.com.
Based in Annapolis, Maryland, Alexander Properties, L.L.C., and
Soultana Efthimiadis filed for Chapter 11 bankruptcy (Bankr. D.
Md. Case Nos. 10-38095 and 10-38104) on Dec. 14, 2010. James C.
Olson, Esq., serves as bankruptcy counsel. Alexander Properties
estimated under $50,000 in assets and $1 million to $10 million in
debts.
Soultana Efthimiadis is represented by Aryeh E. Stein, Esq., at
Meridian Law LLC. Efthimiadis estimated $100,001 to $500,000 in
assets and $1 million to $10 million in debts.
The Patapsco Bank, Alexander Properties' lender, is represented by
Michael C. Bolesta, Esq., at Gebhardt & Smith LLP.
ALT HOTEL: Cash Collateral Hearing Slated for April 9
-----------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
has continued until April 9, 2012, at 10:00 a.m., the hearing to
consider ALT Hotel, LLC's request for continued access to the cash
collateral.
As reported in the Troubled Company Reporter on March 23, 2012,
the senior lender consented to the use of the cash collateral
relating to the hotel's room revenues, meeting space revenues,
food and beverage revenues and other operating department
revenues, rentals and other income and monies received or held in
impound or trust accounts, to operate its business operations.
As reported in the TCR on Dec. 30, 2011, as adequate protection to
the diminution in the value of the lender's collateral, the Debtor
will grant the senior lender, among other things: (i) replacement
liens with the same validity and priority on all rents and all
other property of the estate of the same kind and nature on which
the senior lender had a duly perfected and valid lien and security
interest on a prepetition basis; (ii) make payments to the senior
lender equal to interest on the outstanding senior debt at the
default rate set forth in the senior loan agreement; (iii)
continue to maintain adequate insurance on all property on which
the senior lender holds a duly perfected and valid lien and
security interest on a prepetition basis.
About ALT Hotel LLC
ALT Hotel, LLC's sole asset is the Allerton Hotel located in the
"Magnificent Mile" area of Chicago. The Hotel is managed by Kokua
Hospitality, LLC, pursuant to a Hotel Management Agreement, dated
Nov. 9, 2006. Kokua is the exclusive manager and operator of the
Hotel, and receives management fees for its services, with the
amount of such fees directly linked to the annual performance of
the Hotel. Hotel Allerton Mezz, LLC, is the sole member of ALT
Hotel.
ALT Hotel filed for Chapter 11 bankruptcy (Bankr. N.D. Ill. Case
No. 11-19401) on May 5, 2011. Judge A. Benjamin Goldgar presides
over the case. Neal L. Wolf, Esq., Dean C. Gramlich, Esq., and
Jordan M. Litwin, Esq., at Neal Wolf & Associates, LLC, in
Chicago, Illinois, serve as bankruptcy counsel to the Debtor. In
its petition, the Debtor estimated $100 million to $500 million in
assets and $50 million to $100 million in debts. FTI Consulting
serves as the Debtor's financial advisors. Affiliate PETRA Fund
REIT Corp. sought Chapter 11 protection (Bankr. S.D.N.Y. Case No.
10-15500) on Oct. 20, 2010.
ALT HOTEL: Plan Confirmation Hearing Slated for July 23
-------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
will convene a hearing on July 23, 2012, at 10:30 a.m., to
consider the confirmation of ALT Hotel, LLC's Plan of
Reorganization.
Objections, if any, to approval of the plan are due June 25. The
Debtor's response to any objections is due July 9.
The Court also ordered that to the extent discovery is required,
final discovery cut off is July 2.
According to the Amended Disclosure Statement, the Debtor
anticipates the receipt of revenue sufficient to meet its debt
services obligations under the amended and restated loan
agreement, amended and restated promissory note and related
documents
Under the Plan, the secured lender will, among other things,
retain all of its liens and security interests in the property of
the Debtor. Holders of other secured claims will have their
claims reinstated.
Each holder of general unsecured claims will receive 50% of the
amount of such holder's allowed claim on the Effective Date and
50% of the balance of such holder's allowed claim, together with
the interest computed at the rate of 5% per annum, 180 days after
the Effective Date.
As to the equity holder's deficiency claim, the claim will accrue
interest at the rate of 7% per annum commencing upon the Effective
Date. Each month after the Effective Date, the equity holder will
receive a payment equal to the amount of Excess Cash Flow, if any,
which will be applied first to accrued and unpaid interest and
second to principal, until the claim and second to principal,
until the claim together with all interest that has accrued
thereon, has been paid in full.
The interest of the equity holder is unimpaired under the Plan.
A full-text copy of the Amended Disclosure Statement is available
for free at http://bankrupt.com/misc/ALT_HOTEL_ds_amended.pdf
About ALT Hotel LLC
ALT Hotel, LLC's sole asset is the Allerton Hotel located in the
"Magnificent Mile" area of Chicago. The Hotel is managed by Kokua
Hospitality, LLC, pursuant to a Hotel Management Agreement, dated
Nov. 9, 2006. Kokua is the exclusive manager and operator of the
Hotel, and receives management fees for its services, with the
amount of such fees directly linked to the annual performance of
the Hotel. Hotel Allerton Mezz, LLC, is the sole member of ALT
Hotel.
ALT Hotel filed for Chapter 11 bankruptcy (Bankr. N.D. Ill. Case
No. 11-19401) on May 5, 2011. Judge A. Benjamin Goldgar presides
over the case. Neal L. Wolf, Esq., Dean C. Gramlich, Esq., and
Jordan M. Litwin, Esq., at Neal Wolf & Associates, LLC, in
Chicago, Illinois, serve as bankruptcy counsel to the Debtor. In
its petition, the Debtor estimated $100 million to $500 million in
assets and $50 million to $100 million in debts. FTI Consulting
serves as the Debtor's financial advisors. Affiliate PETRA Fund
REIT Corp. sought Chapter 11 protection (Bankr. S.D.N.Y. Case No.
10-15500) on Oct. 20, 2010.
ALTER COMMUNICATIONS: Three Bidders Vie for Jewish Times
--------------------------------------------------------
Arthur Hirsch at The Baltimore Sun reports that H.G. Roebuck & Son
Inc., a key creditor in the bankruptcy case of the Baltimore
Jewish Times and Style Magazine publisher, is the third bidder for
the firm, raising the prospect of new ownership that the current
chief executive officer said would be "a real tragic end to this
company."
The report relates Zvi Guttman, the trustee appointed by the U.S.
Bankruptcy Court to sell Alter Communications Inc.'s assets, said
H.G. Roebuck, the Company's former printer, submitted its initial
bid of $450,000 hours before the 5:00 p.m. deadline on March 29.
According to the report, starting bids of $440,000 were entered
earlier by Route 95 Publications LLC, run by the same group that
publishes Washington Jewish Week; and Baltimore Community
Publishing LLC, an investor group led by Scott Rifkin, an Owings
Mills physician and health care entrepreneur.
The report says Mr. Guttman will preside at the auction scheduled
for April 2, 2012, at the downtown office of Alter's lawyer,
Tydings & Rosenberg LLP. The results of the auction will then be
considered at a hearing before a bankruptcy judge, which is
scheduled for April 5, 2012.
According to The Jewish Times, the trustee said bidding will begin
at $450,000 and could go as high as $600,000. The trustee also
said he expects that upwards to $800,000 will be needed by the
owners due to the need to inject operating costs into the
organization.
About Alter Communications
Based in Baltimore, Maryland, Alter Communications publishes the
Baltimore Jewish Times. Other publications include the magazine
Style, with 90,000 circulation, and Chesapeake Life, with a
circulation of 57,000.
Alter Communications filed for Chapter 11 bankruptcy (Bankr. D.
Md. Case No. 10-18241) on April 14, 2010, after losing a $362,000
judgment to the printer, H.G. Roebuck & Son Inc. Alan M. Grochal,
Esq., and Maria Ellena Chavez-Ruark, Esq., at Tydings and
Rosenberg, in Baltimore, serve as the Debtor's bankruptcy counsel.
The Debtor estimated assets and debts between $1 million and
$10 million in its Chapter 11 petition.
In December 2010, the Bankruptcy Court approved Alter's Chapter 11
exit plan. Roebuck appealed, saying the plan wasn't filed in good
faith and that it "discriminates unfairly."
In June 2011, the U.S. District Judge Court in Maryland set aside
the confirmation order. Because Roebuck said it would pay more
for the new stock, the District Court reversed and sent the case
back to the bankruptcy court with instructions to allow the filing
of competing plans.
AMARU INC: Incurs $1.4 Million Net Loss from Operations in 2011
---------------------------------------------------------------
Amaru, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss
from operations of $1.37 million on $4,462 of total revenue in
2011, compared with a net loss from operations of $1.50 million on
$48,382 of total revenue in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $2.86 million
in total assets, $3.44 million in total liabilities and a $578,709
total stockholders' deficit.
For 2011, Wilson Morgan, LLP, in Irvine, California, noted that
the Company has sustained accumulated losses from operations
totaling $40,678,196 at Dec. 31, 2011. This condition and the
Company's lack of significant revenue, raise substantial doubt
about the Company's ability to continue as going concern.
A copy of the Form 10-K is available for free at:
http://is.gd/36GYgn
About Amaru Inc.
Singapore-based Amaru, Inc., a Nevada corporation, is in the
business of broadband entertainment-on-demand, streaming via
computers, television sets, PDAs (Personal Digital Assistant) and
the provision of broadband services. The Company's business
includes channel and program sponsorship (advertising and
branding); online subscriptions, channel/portal development
(digital programming services); content aggregation and
syndication, broadband consulting services, broadband hosting and
streaming services and E-commerce.
AMBAC FINANCIAL: Has $963.2-Mil. Fourth Quarter Net Loss
--------------------------------------------------------
Ambac Financial Group, Inc. disclosed on March 22, 2012, a fourth
quarter 2011 net loss of $963.2 million. This compares to a
fourth quarter 2010 net loss of $81.6 million. Relative to fourth
quarter 2010, fourth quarter 2011 results were primarily driven by
higher net loss and loss expenses, derivative product losses, and
higher losses on variable interest entities ("VIE's").
As of December 31, 2011, unrestricted cash, short-term securities
and bonds at the holding company (Ambac) totaled $35.4 million, a
decline of $10.9 million from September 30, 2011.
The Company said total assets decreased during the fourth quarter
of 2011 to $27.1 billion from $27.6 billion at September 30, 2011,
primarily due to declines in the balance of VIE assets, premium
receivables, and the value of the investment portfolio.
Liabilities total $30.2 billion.
During the fourth quarter of 2011, the amount of VIE assets fell
by $140.6 million to $16.5 billion from $16.7 billion and non-VIE
premium receivables declined $74.7 million to $2.0 billion from
$2.1 billion. The fair value of the consolidated non-VIE
investment portfolio fell by $186.2 million to $6.9 billion
(amortized cost of $6.4 billion) as of December 31, 2011 from
$7.1 billion (amortized cost of $6.6 billion) as of September 30,
2011.
The financial guarantee non-VIE investment portfolio balance had
a fair value of $6.0 billion (amortized cost of $5.6 billion) as
of December 31, 2011, down $128.9 million from $6.2 billion
(amortized cost of $5.7 billion) at September 30, 2011. The
portfolio consists of primarily high quality municipal and
corporate bonds, asset backed securities, U.S. Agencies, Agency
MBS, as well as non-agency MBS, including Ambac Assurance
guaranteed RMBS.
Liabilities subject to compromise totaled roughly $1.7 billion at
December 31, 2011.
As of December 31, 2011, liabilities subject to compromise consist
of:
Accrued interest payable $68,123
Other 17,109
Senior unsecured notes 1,222,189
Directly-issued Subordinated
capital securities 400,000
Consolidated liabilities
subject to compromise $1,707,421
As of December 31, 2011, Ambac Assurance reported statutory
capital and surplus of $495.3 million, up from $273.1 million as
of September 30, 2011. Ambac Assurance's statutory financial
statements include the combined results of Ambac Assurance's
general account and the Segregated Account (formed on March 24,
2010). Statutory capital and surplus at December 31, 2011, were
positively impacted by the release of $430.3 million of Ambac
Assurance's contingency reserves, offset by a quarterly statutory
net loss of $182.6 million.
Ambac Assurance's claims-paying resources amount to approximately
$6.4 billion as of December 31, 2011, down $200 million from $6.6
billion at September 30, 2011. This excludes Ambac Assurance UK
Limited's claims-paying resources of approximately $1.1 billion.
The decline in claims paying resources was primarily attributable
to net claims paid during the quarter.
The Bankruptcy Court entered an order confirming Ambac's plan of
reorganization on March 14, 2012. However, Ambac said it is not
currently able to estimate when it will be able to consummate the
reorganization. Until the plan is consummated and Ambac emerges
from bankruptcy, Ambac will continue to operate in the ordinary
course of business as "debtor-in-possession" in accordance with
the applicable provisions of the Bankruptcy Code and the orders of
the Bankruptcy Court.
* * *
Ambac Financial filed on February 29, 2012, statutory financial
statements as of and for the quarter and full year ended December
31, 2011, for AAC, its Segregated Account and Everspan Financial
Guarantee Corporation.
Full-text copies of the 2011 Annual Reports are available for
free at:
* AAC's Annual Report
http://bankrupt.com/misc/AAC2011AnnualRpt.pdf
* AAC's Segregated Account's Quarter Report
http://bankrupt.com/misc/SegregatedAcct2011AnnualRpt.pdf
* Everspan's Quarter Report
http://bankrupt.com/misc/Everspan2011AnnualRpt.pdf
AFG posted in its Web site, a supplement to the fourth quarter
and full year 2011 results, including tables on key financial
data, largest domestic public finance exposures, largest
structured finance exposures, and largest international finance
exposures. A full-text copy of the supplement is available for
free at http://bankrupt.com/misc/Ambac_2011AnnualRptSupp.pdf
AFG filed with the U.S. Securities and Exchange Commission on
March 22, 2012, an annual report on Form 10-K for the period
ended December 31, 2011, a copy of which is available for free
at http://is.gd/YjaUpT
About Ambac Financial
Ambac Financial Group, Inc., headquartered in New York City, is a
holding company whose affiliates provided financial guarantees and
financial services to clients in both the public and private
sectors around the world.
Ambac Financial filed a voluntary petition for relief under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No.
10-15973) in Manhattan on Nov. 8, 2010. Ambac said it will
continue to operate in the ordinary course of business as "debtor-
in-possession" under the jurisdiction of the Bankruptcy Court and
in accordance with the applicable provisions of the Bankruptcy
Code and the orders of the Bankruptcy Court.
Ambac's bond insurance unit, Ambac Assurance Corp., did not file
for bankruptcy. AAC is being restructured by state regulators in
Wisconsin. AAC is domiciled in Wisconsin and regulated by the
Office of the Commissioner of Insurance of the State of Wisconsin.
The parent company is not regulated by the OCI.
Ambac's consolidated balance sheet -- which includes non-debtor
Ambac Assurance Corp -- showed US$30.05 billion in total assets,
US$31.47 billion in total liabilities, and a US$1.42 billion
stockholders' deficit, at June 30, 2010.
On an unconsolidated basis, Ambac said in a court filing that
it has assets of (US$394.5 million) and total liabilities of
US$1.6826 billion as of June 30, 2010.
Bank of New York Mellon Corp., as trustee to seven different types
of notes, was listed as the largest unsecured creditor, with
claims totaling about US$1.62 billion.
Peter A. Ivanick, Esq., Allison H. Weiss, Esq., and Todd L.
Padnos, Esq., at Dewey & LeBoeuf LLP, serve as the Debtor's
bankruptcy counsel. The Blackstone Group LP is the Debtor's
financial advisor. Kurtzman Carson Consultants LLC is the claims
and notice agent. KPMG LLP is tax consultant to the Debtor.
Anthony Princi, Esq., Gary S. Lee, Esq., and Brett H. Miller,
Esq., at Morrison & Foerster LLP, in New York, serve as counsel
to the Official Committee of Unsecured Creditors. Lazard Freres
& Co. LLC is the Committee's financial advisor.
Bankruptcy Creditors' Service, Inc., publishes Ambac Bankruptcy
News. The newsletter tracks the Chapter 11 proceeding undertaken
by Ambac Financial Group and the restructuring proceedings of
Ambac Assurance Corp. (http://bankrupt.com/newsstand/or 215/945-
7000).
AMBAC FINANCIAL: Paid $3.6-Mil. to Top Executives in 2011
---------------------------------------------------------
Ambac Financial Group, Inc. paid out salary, bonus and other
compensation awards, totaling $3,693,899, to four of its top
executives for the fiscal year ended December 31, 2011, the
Company disclosed in its 2011 Annual Report filing with the U.S.
Securities and Exchange Commission dated March 22, 2012.
The executives and their corresponding salaries and awards are:
All
Name & Stock Other
Position Salary Bonus Awards Compensation Total
-------- ------ ----- ------ ------------ -----
Diana N. $556,347 $550,000 0 $9,800 $1,116,147
Adams,
President
and Chief
Executive
Officer
David W. $639,423 $115,000 0 $53,729 $808,152
Wallis
President
and Chief
Executive
Officer
David $600,000 $400,000 0 $9,800 $1,009,800
Trick
Senior
Managing
Director,
Chief
Financial
Officer
and
Treasurer
Robert $500,000 $250,000 0 $9,800 $759,800
Eisman
Senior
Managing
Director
and Chief
Accounting
Officer
Mr. Wallis disclosed to the SEC that he disposed of 352,708 shares
of AFG's common stock, at $0 price per share. Consequently, Mr.
Wallis beneficially owns 3,251 shares of AFG common stock.
As a result of Mr. Wallis' resignation as CEO of the Company in
July 2011, his right to receive 352,708 restricted stock units
was terminated.
In another filing, Ms. Adams disclosed on March 22, 2012, that
she beneficially owns 18,781 shares of AFG common stock, which
includes restricted stock units granted to her under the 1997
Equity Plan, as amended.
About Ambac Financial
Ambac Financial Group, Inc., headquartered in New York City, is a
holding company whose affiliates provided financial guarantees and
financial services to clients in both the public and private
sectors around the world.
Ambac Financial filed a voluntary petition for relief under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No.
10-15973) in Manhattan on Nov. 8, 2010. Ambac said it will
continue to operate in the ordinary course of business as "debtor-
in-possession" under the jurisdiction of the Bankruptcy Court and
in accordance with the applicable provisions of the Bankruptcy
Code and the orders of the Bankruptcy Court.
Ambac's bond insurance unit, Ambac Assurance Corp., did not file
for bankruptcy. AAC is being restructured by state regulators in
Wisconsin. AAC is domiciled in Wisconsin and regulated by the
Office of the Commissioner of Insurance of the State of Wisconsin.
The parent company is not regulated by the OCI.
Ambac's consolidated balance sheet -- which includes non-debtor
Ambac Assurance Corp -- showed US$30.05 billion in total assets,
US$31.47 billion in total liabilities, and a US$1.42 billion
stockholders' deficit, at June 30, 2010.
On an unconsolidated basis, Ambac said in a court filing that
it has assets of (US$394.5 million) and total liabilities of
US$1.6826 billion as of June 30, 2010.
Bank of New York Mellon Corp., as trustee to seven different types
of notes, is listed as the largest unsecured creditor, with claims
totaling about US$1.62 billion.
Peter A. Ivanick, Esq., Allison H. Weiss, Esq., and Todd L.
Padnos, Esq., at Dewey & LeBoeuf LLP, serve as the Debtor's
bankruptcy counsel. The Blackstone Group LP is the Debtor's
financial advisor. Kurtzman Carson Consultants LLC is the claims
and notice agent. KPMG LLP is tax consultant to the Debtor.
Anthony Princi, Esq., Gary S. Lee, Esq., and Brett H. Miller,
Esq., at Morrison & Foerster LLP, in New York, serve as counsel
to the Official Committee of Unsecured Creditors. Lazard Freres
& Co. LLC is the Committee's financial advisor.
Bankruptcy Creditors' Service, Inc., publishes Ambac Bankruptcy
News. The newsletter tracks the Chapter 11 proceeding undertaken
by Ambac Financial Group and the restructuring proceedings of
Ambac Assurance Corp. (http://bankrupt.com/newsstand/or 215/945-
7000).
AMBAC FINANCIAL: Won't Consummate Plan Pending IRS Settlement
-------------------------------------------------------------
Ambac Financial Group, Inc. filed with the U.S. Securities and
Exchange Commission on March 20, 2012, a disclosure regarding the
confirmation of its Fifth Amended Plan of Reorganization.
On March 14, 2012, Judge Shelley C. Chapman of the U.S. Bankruptcy
Court for the Southern District of New York entered an order
confirming the Plan.
The Plan contemplates the reorganization of the Company and the
resolution of all outstanding Claims against and Equity Interests
in the Company. Subject to the specific provisions set forth in
the Plan, all of the prepetition debt obligations owed to
unsecured creditors of the Company will, as a general matter, be
converted into New Common Stock to be issued by the Company. In
addition, holders of Senior Notes Claims and Subordinated Notes
Claims will receive Warrant. Moreover, the holders of Equity
Interests of the Company or of rights or Claims arising in
connection therewith will receive no distributions on account of
these Claims or Equity Interests, which will be cancelled.
Administrative Claims, Claims for Accrued Professional
Compensation and Priority Tax Claims are Unimpaired under the
Plan, which means, in general, that the Plan will leave their
legal, equitable and contractual rights unaltered.
If the Plan is consummated, on the Effective Date or as
reasonably practicable thereafter, the Company will make
distributions in respect of certain classes of Claims as provided
in the Plan.
However, no provision of the Plan, the Confirmation Order or any
other document or agreement impairs, changes or modifies the
Internal Revenue Service's rights in connection with the IRS
Dispute. Pending finalization of the IRS Settlement, the Company
will not consummate the Plan.
As of March 9, 2012, the Company had 302,431,515 shares of common
stock outstanding (net of 5,585,249 treasury shares). On the
Effective Date, all Equity Interests in the Company (including
all issued and outstanding common stock and securities
convertible into common stock) will be canceled and extinguished
without further action. The number of shares of New Common Stock
to be reserved for future issuance under the Plan in respect of
certain Claims allowed under the Plan has not yet been
determined.
A summary of the Plan terms is available for free at:
http://is.gd/2gtgn5
In related developments, the Court approved a stipulation
resolving Karthikeyan V. Veera's objection to confirmation of the
Plan. To address Mr. Veera's objection, the Plan modifies the
injunction and holders' general release provisions, so as to
carve-out the class action entitled Veera v. Ambac Plan
Administrative Committee, et al., No. 10-cv-4191 pending before
the U.S. District Court for the Southern District of New York.
Mr. Veera is deemed to have withdrawn his Plan Confirmation
Objection.
About Ambac Financial
Ambac Financial Group, Inc., headquartered in New York City, is a
holding company whose affiliates provided financial guarantees and
financial services to clients in both the public and private
sectors around the world.
Ambac Financial filed a voluntary petition for relief under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No.
10-15973) in Manhattan on Nov. 8, 2010. Ambac said it will
continue to operate in the ordinary course of business as "debtor-
in-possession" under the jurisdiction of the Bankruptcy Court and
in accordance with the applicable provisions of the Bankruptcy
Code and the orders of the Bankruptcy Court.
Ambac's bond insurance unit, Ambac Assurance Corp., did not file
for bankruptcy. AAC is being restructured by state regulators in
Wisconsin. AAC is domiciled in Wisconsin and regulated by the
Office of the Commissioner of Insurance of the State of Wisconsin.
The parent company is not regulated by the OCI.
Ambac's consolidated balance sheet -- which includes non-debtor
Ambac Assurance Corp -- showed US$30.05 billion in total assets,
US$31.47 billion in total liabilities, and a US$1.42 billion
stockholders' deficit, at June 30, 2010.
On an unconsolidated basis, Ambac said in a court filing that
it has assets of (US$394.5 million) and total liabilities of
US$1.6826 billion as of June 30, 2010.
Bank of New York Mellon Corp., as trustee to seven different types
of notes, is listed as the largest unsecured creditor, with claims
totaling about US$1.62 billion.
Peter A. Ivanick, Esq., Allison H. Weiss, Esq., and Todd L.
Padnos, Esq., at Dewey & LeBoeuf LLP, serve as the Debtor's
bankruptcy counsel. The Blackstone Group LP is the Debtor's
financial advisor. Kurtzman Carson Consultants LLC is the claims
and notice agent. KPMG LLP is tax consultant to the Debtor.
Anthony Princi, Esq., Gary S. Lee, Esq., and Brett H. Miller,
Esq., at Morrison & Foerster LLP, in New York, serve as counsel
to the Official Committee of Unsecured Creditors. Lazard Freres
& Co. LLC is the Committee's financial advisor.
Bankruptcy Creditors' Service, Inc., publishes Ambac Bankruptcy
News. The newsletter tracks the Chapter 11 proceeding undertaken
by Ambac Financial Group and the restructuring proceedings of
Ambac Assurance Corp. (http://bankrupt.com/newsstand/or 215/945-
7000).
AMEREN ENERGY: Moody's Reviews 'Ba2' Debt Rating for Downgrade
--------------------------------------------------------------
Moody's Investors Service placed the ratings of Ameren Energy
Generating Company (Ameren Genco, Ba2 senior unsecured) on review
for possible downgrade and affirmed the ratings and stable outlook
of Ameren Corporation (Ameren, Baa3 senior unsecured, Prime-3
short-term rating for commercial paper).
Ratings Rationale
"The review of Ameren Genco's ratings reflects the company's
constrained liquidity position resulting from severe restrictions
on external borrowings that are being triggered by the company's
declining coverage metrics," said Michael G. Haggarty, Senior Vice
President. Under Ameren Genco's bond indenture, the company may
not borrow any additional funds from external, third-party sources
if its interest coverage falls below 2.5x or debt to capital rises
above 60%. Based on projections of operating results and cash
flows as of December 31, 2011, the company expects to be below the
required 2.5x interest coverage threshold as early as the end of
the first quarter of 2013, precluding all external borrowings. The
restriction on additional borrowings includes borrowings under its
$500 million bank credit facility, the company's main external
source of liquidity.
To address this borrowing restriction, Ameren Genco has put in
place a two-year Put Option Agreement with affiliate Ameren Energy
Resources Generating Company (AERG - unrated) giving Ameren Genco
the ability to raise $100 million within one business day upon
exercise of the option. The Put Option Agreement allows Ameren
Genco to sell three of its natural gas combustion turbine plants
to AERG for the greater of $100 million or the fair market value
of the assets as determined by a third-party valuation process.
The obligation of AERG to purchase these assets upon exercise of
the put option is guaranteed by Ameren.
The review will examine the terms and conditions of the Put Option
Agreement, whether the size and availability of the Agreement will
be sufficient to meet Ameren Genco's liquidity needs going
forward, as well as the other sources of parent company and other
liquidity support that will be available to Ameren Genco,
including borrowings under the Ameren system non-state-regulated
subsidiary money pool, which would still be permitted under the
terms of the indenture. The review will consider the extent to
which the power sales and marketing services provided by affiliate
Ameren Energy Marketing Company will insulate Ameren Genco from
unexpected liquidity calls or collateral postings. Moody's will
also evaluate what other options are available to Ameren Genco to
maintain liquidity and cash flow coverage metrics during a period
of low power prices, including further measures the company could
take to cut expenses or defer capital expenditures.
The affirmation of the ratings and stable outlook of parent
company Ameren considers the relatively modest contribution of
Ameren Genco to Ameren's overall cash flow and risk profile
compared to its regulated utility subsidiaries; the parent's thus
far limited support for Ameren Genco and Moody's expectation that
the parent will not provide any capital contributions or other
significant direct financial support to Ameren Genco. The
affirmation also considers the modest $425 million of debt at the
parent company level; the Baa2 rating (senior unsecured) and
stable rating outlook of its largest subsidiary, Ameren Missouri;
and recent positive developments at Ameren Illinois (Baa3 senior
unsecured), with ratings that are currently under review for
possible upgrade.
The principal methodology used in this rating was Unregulated
Utilities and Power Companies published in August 2009.
Ratings placed on review for possible downgrade include Ameren
Genco's Ba2 senior unsecured and bank credit facility rating.
Ratings affirmed include Ameren's Baa3 senior unsecured and Issuer
Rating and Prime-3 short-term rating for commercial paper.
Ameren Corporation is a public utility holding company
headquartered in St. Louis, Missouri. It is the parent company of
regulated utility subsidiaries Ameren Missouri and Ameren Illinois
and unregulated generation subsidiaries Ameren Energy Generating
Company and AmerenEnergy Resources Generating Company.
AMERICAN AIRLINES: Plan Filing Exclusivity Extended to Sept. 28
---------------------------------------------------------------
Judge Sean H. Lane of the U.S. Bankruptcy Court for the Southern
District of New York extended the exclusive deadlines under
Section 1121(d) of the Bankruptcy Code for AMR Corporation,
American Airlines, Inc., and their debtor affiliates to:
(i) file a Chapter 11 plan in their bankruptcy cases through
September 28, 2012; and
(ii) solicit acceptances for that plan through November 29, 2012.
The extensions of the Exclusive Periods granted are without
prejudice to further requests that may be made pursuant to
Section 1121(d) by the Debtors or any party-in-interest, for
cause shown; provided, however, that should the Official
Committee of Unsecured Creditors file a motion to shorten the
Debtors' Exclusive Periods, the Debtors will bear the burden in
accordance with Section 1121(d) to show cause to retain or
further extend such Exclusive Periods, Judge Lane ruled.
Counsel to the Official Committee of Unsecured Creditors, John
Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, in Chicago, Illinois, said at a March 22, 2012 hearing that a
Chapter 11 plan will lead to "complete conversion" of unsecured
debt to equity, Bloomberg News reported.
About American Airlines
AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements.
AMR, previously the world's largest airline prior to mergers by
other airlines, is the last of the so-called U.S. legacy airlines
to seek court protection from creditors.
American Airlines, American Eagle and the AmericanConnection
carrier serve 260 airports in more than 50 countries and
territories with, on average, more than 3,300 daily flights. The
combined network fleet numbers more than 900 aircraft.
The Company reported a net loss of $884 million on
$18.02 billion of total operating revenues for the nine months
ended Sept. 30, 2011. AMR recorded a net loss of $471 million in
the year 2010, a net loss of $1.5 billion in 2009, and a net loss
of $2.1 billion in 2008.
The Company's balance sheet at Sept. 30, 2011, showed
$24.72 billion in total assets, $29.55 billion in total
liabilities, and a $4.83 billion stockholders' deficit.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel. Rothschild
Inc., is the financial advisor. Garden City Group Inc. is the
claims and notice agent.
Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.
Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).
AMERICAN AIRLINES: Lease Decision Deadline Extended to June 26
--------------------------------------------------------------
Bankruptcy Judge Sean Lane extended to June 26, 2012, the period
by which American Airlines Inc. and its affiliates may assume or
reject their unexpired non-residential real property leases,
regardless of whether those unexpired leases have been identified
in the exhibit appended in the motion.
The Court entered the order after all objections, including those
filed by The Bank of New York Mellon Trust Company, N.A., and
other parties, have been resolved.
Indenture Trustees BNY Mellon and Law Debenture Trust Company of
New York objected to the extension request, complaining that the
Debtors' Motion contained a catch-all provision that may be
construed to be asking the Court to extend the deadline under
Section 365(d)(4) of the Bankruptcy Code as to certain agreements
which the Indenture Trustees have interest in and under which the
Debtors are not making current payments. The Indenture Trustees
sought clarification whether those agreements are in fact leases
covered by the Debtors' Motion. A list of those agreements is
available for free at:
http://bankrupt.com/misc/AmAir_IndentureTrusteesPacts.pdf
Another Indenture Trustee, Manufacturers and Trades Trust Company
joined in the Objection.
Law Debenture is represented by:
Mohsin N. Khambati, Esq.
DEWEY & LeBOEUF LLP
180 North Stetson Avenue, Suite 3700
Chicago, IL 60601
Tel: (312) 794-8000
Fax: (312) 794-8100
E-mail: mkhambati@dl.com
Manufacturers and Traders Trust is represented by:
Kristin K. Going, Esq.
Robert K. Malone, Esq.
DRINKER BIDDLE & REATH LLP
1177 Avenue of the Americas, 41st Floor
New York, NY 10036-2714
Tel: (212) 248-3140
Fax: (212) 248-3141
E-mail: Kristin.Going@dbr.com
Robert.Malone@dbr.com
The Dallas/Fort Worth International Airport Board; The
Dallas/Fort Worth International Airport Facility Improvement
Corporation; and The City of Fort Worth and AllianceAirport
Authority, Inc. each reserved and preserved all of its rights
with respect to the Motion, citing that the Debtors' Motion is
unclear for each of them to pursue an objection.
The Dallas/Forth Worth is represented by:
Selinda A. Melnik, Esq.
DLA Piper LLP
919 N. Market Street, Suite 1500
Wilmington, DE 19801
Tel: 302-468-5650
Fax: 302-394-2341
E-mail: selinda.melnik@dlapiper.com
- and -
Rosa R. Orenstein, Esq.
Nathan M. Nichols, Esq.
SULLIVAN & HOLSTON
4131 N. Central Expressway, Suite 980
Dallas, TX 75204
Tel: 214-528-9560
Fax: 214-528-9581
E-mail: rorenstein@sullivanholston.com
Dallas/Fort Worth International Airport is represented by:
Elaine Flud Rodriguez, Esq.
Dallas/Fort Worth International Airport
Legal Department
P.O. Box 619428
DFW Airport, TX 75261-9428
Tel: (972) 973-5480
Fax: (972) 973-5481
City of Fort Worth/AllianceAirport is represented by:
Jonathan D. Deily, Esq.
Joann Sternheimer, Esq.
DEILY, MOONEY & GLASTETTER, LLP
8 Thurlow Terrace
Albany, NY, 12203
Tel: (518) 436-0344
Fax: (518) 436-8273
E-mail: jdeily@deilylawfirm.com
jsternheimer@deilylawfirm.com
- and -
Peter C. Lewis, Esq.
SCHEEF & STONE, L.L.P.
500 N. Akard, Suite 2700
Dallas, Texas, 75201
Tel: (214) 706-4200
Fax: (214) 706-4242
E-mail: peter.lewis@solidcounsel.com
About American Airlines
AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements.
AMR, previously the world's largest airline prior to mergers by
other airlines, is the last of the so-called U.S. legacy airlines
to seek court protection from creditors.
American Airlines, American Eagle and the AmericanConnection
carrier serve 260 airports in more than 50 countries and
territories with, on average, more than 3,300 daily flights. The
combined network fleet numbers more than 900 aircraft.
The Company reported a net loss of $884 million on
$18.02 billion of total operating revenues for the nine months
ended Sept. 30, 2011. AMR recorded a net loss of $471 million in
the year 2010, a net loss of $1.5 billion in 2009, and a net loss
of $2.1 billion in 2008.
The Company's balance sheet at Sept. 30, 2011, showed
$24.72 billion in total assets, $29.55 billion in total
liabilities, and a $4.83 billion stockholders' deficit.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel. Rothschild
Inc., is the financial advisor. Garden City Group Inc. is the
claims and notice agent.
Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.
Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).
AMERICAN AIRLINES: Withdraws Motion to Stay Suits vs. Non-Debtors
-----------------------------------------------------------------
AMR Corp. and its affiliates withdrew their motion to extend
automatic stay with respect to certain litigation. The Debtors
reserve their rights to seek some or all of the relief sought in
their request by adversary proceeding, motion, or other
appropriate proceeding.
In the Motion, the Debtors specifically seek to enjoin 24 actions
that have been asserted against various non-debtors.
The Association of Professional Flight Attendants and several
parties filed objections to the Debtors' request. The APFA
contends that the relief sought by the Debtors may not be granted
because it is unavailable by motion, and may only be obtained
through an adversary proceeding. Even if it was procedurally
proper, the Debtors' Motion would fail on the merits, argues Hanan
B. Kolko, Esq., at Meyer, Suozzi, English & Klein, P.C., in New
York, counsel to the APFA. The Debtors' generalized and
unsupported statements do not even remotely satisfy their
evidentiary burden of proving that the litigation against the non-
debtors would have material effect on the reorganization efforts
because of unusual circumstances, Mr. Kolko avers. Accordingly,
the APFA asks the Court to deny the Debtors' Motion, including as
to Turn v. Flight Attendant Plan, which was initiated by Mary
Turn, a former American Flight Attendant and current APFA member.
The Allied Pilots Association also objects to the Debtors' request
to the extent the motion seeks to foreclose or prevent the APA
from seeking relief from the automatic stay in the future, when
and if it deems appropriate, to proceed with any action against a
third-party defendant. The APA said any order entered by the
Court should be without prejudice to and expressly reserve all of
the union's rights to seek that relief from the automatic stay
before the Court at a later time.
Tara Trammell and Linda Zagon oppose the proposed stay of their
actions against third-party defendants. Ms. Trammell asserts
that the harm to her interests by a stay outweighs the purely
conclusory and unsupported harm asserted as a basis for extending
the stay to Aerotek Aviation LLC as a third-party defendant to
her lawsuit before the U.S. District Court for the Northern
District of Oklahoma. Ms. Zagon insists that the automatic stay
does not apply to her action because the only named defendant in
her action is the American Airlines Long Term Disability Plan.
Ms. Trammell is represented by:
Mark Hammons, Esq.
HAMMONS, GOWENS & HURST
325 Dean A. McGee Avenue
Oklahoma City, OK 73102
Tel: (405) 235-6100
Fax: (405) 235-6111
E-mail: mark@hammonslaw.com
Ms. Zagon is represented by:
Aaron R. Cahn, Esq.
CARTER LEDYARD & MILBURN LLP
2 Wall Street
New York, NY 10005
Tel: (212) 238-8629
Fax: (212) 732-3232
E-mail: cahn@clm.com
- and -
Glenn R. Kantor, Esq.
Peter S. Sessions, Esq.
KANTOR & KANTOR, LLP
19839 Nordhoff Street
Northridge, CA 91324
E-mail: gkantor@kantorlaw.net
psessions@kantorlaw.net
About American Airlines
AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements.
AMR, previously the world's largest airline prior to mergers by
other airlines, is the last of the so-called U.S. legacy airlines
to seek court protection from creditors.
American Airlines, American Eagle and the AmericanConnection
carrier serve 260 airports in more than 50 countries and
territories with, on average, more than 3,300 daily flights. The
combined network fleet numbers more than 900 aircraft.
The Company reported a net loss of $884 million on
$18.02 billion of total operating revenues for the nine months
ended Sept. 30, 2011. AMR recorded a net loss of $471 million in
the year 2010, a net loss of $1.5 billion in 2009, and a net loss
of $2.1 billion in 2008.
The Company's balance sheet at Sept. 30, 2011, showed
$24.72 billion in total assets, $29.55 billion in total
liabilities, and a $4.83 billion stockholders' deficit.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel. Rothschild
Inc., is the financial advisor. Garden City Group Inc. is the
claims and notice agent.
Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.
Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).
AMERICAN AIRLINES: Wants Lawsuits Over Benefit Plans Barred
-----------------------------------------------------------
AMR Corporation and its debtor affiliates filed adversary
proceedings seeking a judgment extending the automatic stay or,
in the alternative, injunctive relief pursuant to Rule 7001(7) of
the Federal Rules of Bankruptcy Procedure, staying or enjoining,
as applicable, 23 lawsuits brought by several individuals against
the Debtors and one or more Benefit Plans administered by the
Debtors.
The actions against the Benefit Plan Defendants are essentially
actions against the Debtors, Stephen A. Youngman, Esq., at Weil,
Gotshal & Manges LLP, in New York, tells the Court. According to
Mr. Youngman, the continued prosecution of the Benefit Plan
Actions will irreparably harm the Debtors because the Debtors are
responsible for all costs associated with defending the Benefit
Plan Actions, the Debtors may become financially responsible for
any adverse judgment or settlement in the Benefit Plan Actions,
and the Debtors may be collaterally estopped from relitigating the
issues adjudicated in the Actions based on a judgment against the
Benefit Plans.
The cases are AMR Corporation, et al. v. William R. Canada, Jr.,
et al., Adv. Proc. No. 12-01203-shl (Bankr. S.D.N.Y.) and AMR
Corporation, et al. v. Rohan Thomas, et al., Adv. Proc. No 12-
01206-shl (Bankr. S.D.N.Y.).
About American Airlines
AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements.
AMR, previously the world's largest airline prior to mergers by
other airlines, is the last of the so-called U.S. legacy airlines
to seek court protection from creditors.
American Airlines, American Eagle and the AmericanConnection
carrier serve 260 airports in more than 50 countries and
territories with, on average, more than 3,300 daily flights. The
combined network fleet numbers more than 900 aircraft.
The Company reported a net loss of $884 million on
$18.02 billion of total operating revenues for the nine months
ended Sept. 30, 2011. AMR recorded a net loss of $471 million in
the year 2010, a net loss of $1.5 billion in 2009, and a net loss
of $2.1 billion in 2008.
The Company's balance sheet at Sept. 30, 2011, showed
$24.72 billion in total assets, $29.55 billion in total
liabilities, and a $4.83 billion stockholders' deficit.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel. Rothschild
Inc., is the financial advisor. Garden City Group Inc. is the
claims and notice agent.
Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.
Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).
AMERICAN ROCK SALT: S&P Puts 'B' Corp. Credit Rating on Watch Neg
-----------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings, including
the 'B' corporate credit rating, on Mount Morris, N.Y.-based
American Rock Salt Co. LLC (ARS) on CreditWatch with negative
implications.
"The CreditWatch listing reflects our view that demand for rock
salt has weakened due to an unseasonably warm winter in the
company's regional end markets, which may result in lower-than-
expected 2012 earnings and potentially erode the company's
liquidity position," said Standard & Poor's credit analyst
Gayle Bowerman. "We previously expected ARS to generate 2012
adjusted EBITDA in line with 2011 levels of $75 to $80 million,
with leverage around 5.5x. However, at current estimated rates of
salt demand, we now believe that ARS may generate adjusted EBITDA
well below prior-year levels, resulting in leverage greater than
9x. As of Dec. 31, 2011, ARS had total liquidity of $15.6 million,
consisting of $3.6 million in cash and around $12 million in
availability on its $40 million asset-based revolving credit
facility."
"The rating on ARS reflects our assessment of the company's
business risk profile as 'vulnerable' and financial risk profile
as 'aggressive'. Our ratings on ARS reflect its limited diversity,
seasonal demand, and mine concentration, but also consider that
the company benefits from a recession-resistant business
strategically located in western and central New York and
Pennsylvania, regions typically affected by heavy lake-effect
snow," S&P said.
"In resolving the CreditWatch placement, we will meet with
management to discuss near-term operating and financial prospects,
including end-market trends," Ms. Bowerman continued. "As part of
our review, we will assess ARS' contracted revenues and liquidity
position over the next several months to determine if a lower
rating is warranted."
AUDATEX HOLDINGS: A&E Request No Impact on Ba1 CFR, Moody's Says
----------------------------------------------------------------
Moody's Investors Service said Audatex's amend and extend ("A&E")
request to lenders is credit-positive but does not currently
impact the Ba1 Corporate Family Rating, SGL-1 Speculative Grade
Liquidity Rating, or stable outlook.
Audatex Holdings, LLC, a subsidiary of Solera Holdings, Inc.
(ticker: SLH), is a leading global provider of software and
services to the automobile insurance claims processing industry.
Headquartered in Westlake, Texas, Solera reported revenues of $751
million for the twelve months ended December 31, 2011.
AUSTIN MUTUAL: A.M. Best Cuts Financial Strength Rating to 'B'
--------------------------------------------------------------
A.M. Best Co. has downgraded the financial strength rating to B
(Fair) from B++ (Good) and issuer credit rating to "bb" from "bbb"
of Austin Mutual Insurance Company (Austin Mutual) (Maple Grove,
MN). The outlook for both ratings is negative.
The rating actions reflect Austin Mutual's poor fourth quarter
operating results, whereby underwriting performance and accounting
adjustments led to significant declines in surplus well below
projected levels. Consequently, risk-adjusted capitalization
sharply declined to a level no longer appropriate for a secure
rating. This follows a continuing trend of underwriting losses
during the recent five-year period, which were driven by increased
frequency and severity of weather-related and automobile liability
losses.
Management has begun to execute several aggressive strategic
initiatives to improve the company's underwriting performance.
However, despite some improvement in early 2012 results due to
milder weather patterns, it remains to be seen whether successful
execution of these business plans will materialize into a longer
positive trend of profitable results. As a result, A.M. Best
remains concerned with Austin Mutual's volatile underwriting
performance and potential for further erosion of capital, as its
business continues to face ongoing exposure to weather-related
events and challenging competitive market conditions.
Before the negative outlook is removed, Austin Mutual will need to
significantly improve its operating performance and risk-adjusted
capitalization. Further negative rating actions may occur if
Austin Mutual's poor underwriting performance persists in 2012,
causing a further deterioration of its risk-adjusted
capitalization.
AVIS BUDGET: DBRS Confirms 'B' Issuer Rating & Unsec. Debt Rating
-----------------------------------------------------------------
DBRS, Inc. has confirmed the ratings of Avis Budget Group, Inc.
and related subsidiaries, including its Issuer Rating of B (high)
and Senior Unsecured Debt rating of B. The trend on all ratings
is Stable. This rating action follows DBRS's annual review of the
Company.
The rating confirmation reflects the Company's sound business
franchise, diversification of revenue and its leading market
position in the on-airport vehicle rental market. The ratings
also consider the Company's solid fleet management and the
financial flexibility inherent in the business. Furthermore, the
ratings and the Stable trend consider the improving industry
fundamentals and DBRS's view that these fundamentals will continue
to be favorable through 2012. These positive rating factors,
however, are somewhat offset by the Company's leveraged position
as compared to book equity and the preponderance of wholesale and
secured funding in relation to the balance sheet. Moreover, while
underlying financial performance evidenced positive momentum in
2011, the ratings consider the recent run of weakened
profitability.
Avis Budget's sound business franchise is underpinned by its dual-
brand strategy, which is a key consideration in the rating. The
franchise combined with solid fleet management has allowed the
Company to navigate through seasonal markets and various business
cycles. The presence of the Budget brand, which has traditionally
focused on the price conscious and leisure traveler and the
premium Avis brand catering to the premium and corporate traveler,
affords the Company multiple touch points with customers.
Moreover, the brands enjoy complementary demand patterns, which
the Company leverages by shifting fleet to meet demand, thereby
enhancing fleet efficiency.
DBRS sees the recent acquisition of Avis Europe as further
strengthening the franchise as it broadens the Company's global
presence particularly in faster growing emerging markets. As with
any acquisition, integration risk is present. However, in this
acquisition DBRS considers these risks as low given the companies
share branding and operate on the same technology platform. Given
the funding structure which did not result in a material movement
in Avis Budget's leverage metrics, DBRS did not view the
acquisition as a negative to ratings. Nevertheless, given the
increased earnings capacity gained from the acquisition, DBRS
expects that Avis Budget will continue its efforts to reduce
leverage going forward. DBRS will look for evidence that Avis
Budget is capturing the benefits and synergies anticipated in the
transaction while managing the modest integration risks.
Although Avis Budget reported a net loss of $29 million in 2011,
the ratings consider the positive momentum in the underlying
financial performance. Indeed, corporate adjusted EBITDA
increased 52% year-on-year to $605 million, the highest in Company
history. Revenues grew 14% year-on-year to $5.9 billion,
reflecting the acquisition of Avis Europe. Excluding the
acquisition, revenues were 7% higher on expanding transaction
volumes partially offset by a slight decline in pricing. Given
Avis Budget's substantial franchise and market leading position,
DBRS sees the Company's ability to leverage these strengths into
sustainable improvement in profitability as global travel volumes
rebound as a key challenge over the medium-term.
The ratings consider the well-managed funding and liquidity
profile, which has been underpinned by the Company's demonstrated
access to the capital markets. In 2011, the Company issued $682
million of corporate debt and $650 million of fleet-related debt.
Importantly, Avis has pre-funded a large majority of the $1.9
billion of fleet-backed debt maturing in 2012 and has no corporate
debt maturities until 2014. Nonetheless, given the preponderance
of wholesale funding, which exposes the Company to disruptions in
the capital markets, DBRS sees managing liquidity through the
cycles as a key challenge.
DBRS considers the leveraged balance sheet as a negative factor in
the ratings. However, the high proportion of fleet-backed debt in
the debt stack provides a level of tolerance, given the
flexibility in altering the fleet size and composition, as
discussed above. Vehicle-related debt constitutes 63.5% of the
funding stack at December 31, 2011. Given the nature of the
industry which requires significant capital to invest and maintain
fleet, DBRS is comfortable with a level of secured debt. However,
while DBRS recognizes that fleet-backed debt provides lower cost
funding, better matching of assets and liabilities, and
flexibility to remove fleet and associated debt as demand
fluctuates. Fleet-backed debt also has more refinancing risk as
the duration of the debt tends to be shorter than unsecured
corporate debt. Further, the ratings consider the highly
encumbered nature of the balance sheet owed to the preponderance
of secured debt, which is factored in the one notch differential
between the Issuer and Senior Unsecured Debt ratings.
The trend is Stable, reflecting DBRS's view that Avis Budget's
underlying performance will progress and the positive trajectory
will persist as the Company focuses on improving margins through
good pricing discipline, cost cutting initiatives, and improved
funding costs. Lastly, the trend reflects DBRS's expectations
that industry fundamentals will remain favorable in 2012, with the
expectation that demand will sustain its positive momentum and the
used-vehicle market remains healthy.
BARNES BAY: Del. Super. Ct. Rules in Anguilla Re Lawsuit
--------------------------------------------------------
Judge Mary M. Johnston of the Superior Court of Delaware, New
Castle County, ruled in the lawsuit, Anguilla Re, LLC, a Delaware
limited liability company and successor by assignment from David
B. Mr. Small and David B. Mr. Small 2004 Annuity Trust U/A/D
7/21/04, Anguilla Re and Counterclaim Defendant, v. Lubert-Adler
Real Estate Fund IV, L.P., a Delaware limited partnership, Lubert-
Adler Capital Real Estate Fund IV, L.P., a Delaware limited
partnership, and Lubert-Adler Real Estate Parallel Fund IV., L.P.,
a Delaware limited partnership, Defendants, Counterclaim Anguilla
Res and Third-Party Anguilla Res, v. David B. Mr. Small, an
individual, Third-Party Defendant, C.A. No. N11C-10-061 MMJ CCLD
(Del. Super. Ct.).
Anguilla Re sued Lubert-Adler Real Estate Fund IV, L.P., Lubert-
Adler Capital Real Estate Fund IV, L.P., and Lubert-Adler Real
Estate Parallel Fund IV, L.P., claiming breach of contract. The
Defendants counterclaimed against Anguilla Re and filed a Third-
Party Complaint against Mr. Small.
Pursuant to Superior Court Rule of Civil Procedure 12(b)(6),
Anguilla Re and Mr. Small seek to dismiss the claims brought by
the Defendants. In addition, the Defendants have moved that the
Superior Court sit by designation as a member of the Court of
Chancery.
On May 21, 2005, Mr. Small and Barnes Bay Development Ltd. entered
into a Purchase and Sale Agreement -- Original PSA -- for the
purchase of Unit 6 of The Villas at Anguilla, located in the
British West Indies. Pursuant to the Original PSA, Mr. Small
agreed to purchase the Villa for $6,250,000, less a 10% incentive
subject to additional terms and conditions. The Original PSA
provided that the sum was to be paid in incremental deposits, and
that Barnes Bay would deliver the Villa in May 2007.
That same day, on May 21, Mr. Small and the Barnes Bay also
executed the following documents: (i) Incentive Addendum to
Purchase and Sale Agreement The Villas at Anguilla; (ii)
Furnishings Addendum to Purchase and Sale Agreement The Villas at
Anguilla; (iii) Addendum to Purchase and Sale Agreement The Villas
at Anguilla; and (iv) Non-Deed Use Restricted Addendum to Purchase
and Sale Agreement The Villas at Anguilla.
On Feb. 20, 2006, Mr. Small, Barnes Bay, and the Guarantors
executed Rider A which modified the Original PSA. Rider A
required Mr. Small to make two additional deposits, totaling
$1,175,050. Rider A further provided that the Villa would be
delivered by December 2008.
In accordance with the Original PSA and Rider A, Mr. Small paid
all deposits due to Barnes Bay. These deposits totaled
$3,425,050.
Because of delays in construction of the Villa, Barnes Bay offered
Mr. Small what Mr. Small has characterized as "complimentary"
stays at the Resort. The Defendants claim that Mr. Small and his
family members stayed at the Resort on eight separate occasions
for a total of 68 nights. The value of those stays, the
Defendants contend, totals $707,500.
On Aug. 2, 2008, by assignment, Anguilla Re acquired Mr. Small's
interest and obligations under the Original PSA, Addenda and
Rider A.
On May 4, 2009, Mr. Small, Barnes Bay, and the Guarantors executed
a letter agreement, which further modified the Original PSA,
Addenda, and Rider A. The letter agreement expressly provided
that: "Buyer has the right to terminate the transaction
contemplated by the Purchase Agreement at any time and for any
reason prior to Closing."
On March 17, 2011, Barnes Bay filed for Chapter 11 bankruptcy
protection. Thereafter, the Bankruptcy Court entered an order
authorizing Barnes Bay to take the necessary steps to transfer
title to the Resort to SOF-VIII-Hotel II Anguilla Holdings LLC.
By letter dated Aug. 15, 2011, Anguilla Re notified the Guarantors
that Barnes Bay was in default of its obligations under the PSA:
"Defaults and events of defaults have occurred and are continuing
under the Purchase and Sale Agreement because, among other things,
the transaction contemplated by the agreement has not yet closed."
Anguilla Re demanded the immediate return of the deposits which
totaled $3,425,050.
A second demand letter was sent to the Guarantors on Oct. 5, 2011,
by which Anguilla Re expressly terminated the PSA, effective that
date.
The Guarantors did not refund the deposits.
On Oct. 6, 2011, Anguilla Re filed suit in this Court against
Defendants, alleging breach of contract against each of the
Guarantors.
On Nov. 17, 2011, the Defendants filed an Answer to Anguilla Re's
Complaint and asserted three counterclaims, alleging: (1) breach
of contract; (2) breach of the implied covenant of good faith and
fair dealing; and (3) entitlement to a declaratory judgment that
the Defendants are not obligated to make payment.
That same day, the Defendants filed a Third-Party Complaint
against Mr. Small, alleging: (1) breach of contract; (2) breach of
the implied covenant of good faith and fair dealing; (3) unjust
enrichment; (4) quantum meruit; and (5) entitlement to a
declaratory judgment that the Defendants are not obligated to make
payment.
Anguilla Re has moved to dismiss the defendants' counterclaims.
Mr. Small has moved to dismiss the Third-Party Complaint. The
Defendants have opposed both motions and have moved to have the
Superior Court sit by designation in the Court of Chancery for
purposes of addressing the equitable relief sought by the
Defendants.
In her ruling, Judge Johnston held that the Defendants have waived
their right to assert choice of law by failing to include any
choice of law argument in their briefing. Additionally, by citing
extensively to Delaware case law and statutory law, the Defendants
have conceded that Delaware law governs these motions.
The Court further held that denial, with leave to re-plead, is
appropriate as to the Defendants' counterclaims and third-party
complaint. In order to determine whether the insolvency (or
another) exception applies, Judge Johnston said the Defendants
must allege information regarding the transfer of the Resort,
including what interests were transferred to the new owner and the
identity of that entity. If the Defendants are not able to do so,
they will be barred from asserting setoff or prosecuting the
principal's affirmative claims, unless an exception to the general
rule is applicable.
Unless or until a determination is made regarding the adequacy of
the remedies at law, the judge said the Superior Court will not be
in a position to sever and transfer any equitable claim to the
Court of Chancery.
A copy of the Court's March 28, 2012 Opinion is available at
http://is.gd/Ej7ai6from Leagle.com.
Anguilla Re is represented by Michael R. Lastowski, Esq., and
Sommer L. Ross, Esq. -- MLastowski@duanemorris.com and
slross@duanemorris.com -- at Duane Morris LLP, in Wilmington,
Delaware.
Stuart M. Brown, Esq., K. Tyler O'Connell, Esq., Aleine
Porterfield, Esq. -- stuart.brown@dlapiper.com and
aleine.porterfield@dlapiper.com -- at DLA Piper LLP (US), in
Wilmington; Gregory S. Otsuka, Esq. -- gregory.otsuka@dlapiper.com
-- at DLA Piper LLP (US), in Chicago, argue for the Defendants.
About Barnes Bay
Beverly Hills, California-based Barnes Bay Development Ltd., owns
the Viceroy Anguilla Resort & Residences on the British West
Indies island of Anguilla. Barnes Bay and two affiliates filed
for Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No.
11-10792) on March 17, 2011, to facilitate the sale of the resort.
Barnes Bay disclosed $3,331,282 in assets and $481,840,435 in
liabilities as of the Chapter 11 filing.
Akin Gump Straus Hauer & Feld LLP is the Debtors' bankruptcy
counsel, and Keithley Lake & Associates is the Debtors' special
Anguillan counsel. Kurtzman Carson Consultants LLC is the
Debtors' claims, noticing, solicitation and balloting agent.
The U.S. Trustee appointed five members to the official committee
of unsecured creditors in the Debtors' cases. Brown Rudnick LLP
serves as the Committee's co-counsel, and Womble Carlyle Sandridge
& Rice, PLLC, as its Delaware co-counsel. C.R. Hodge & Associates
is the Committee's foreign counsel. FTI Consulting, Inc., serves
as the Committee's financial advisors.
U.S. Bankruptcy Judge Peter J. Walsh in Delaware in September said
that he wouldn't approve the resort's reorganization plan because
it unfairly discriminated among creditors who put down deposits to
buy units. Barnes Bay has not filed a revised plan.
Starwood Capital Group LLC was the winner of a July auction to
determine who would sponsor the reorganization plan. It called
for Starwood to assume ownership on account of its US$370 million
secured claim. When the plan failed, Starwood took ownership
through foreclosure.
BEACON POWER: Terminates Registration of Common Stock Securities
----------------------------------------------------------------
Beacon Power Corp. has filed with the U.S. Securities and Exchange
Commission a Form 15 certification and notice of termination of
registration under Section 12(g) of the Securities Exchange Act of
1934 or suspension of duty to file reports under Sections 13 and
15(d) of the Securities Exchange Act of 1934. Said certification/
notice covers the following class of securities of the Company:
1) Company's Common Stock, par value $0.01 per share; and
2) Preferred Share Purchase Rights.
A copy of the Form 15 is available for free at http://is.gd/BKkkMm
About Beacon Power
Beacon Power Corporation, along with affiliates, filed for Chapter
11 protection (Bankr. D. Del. Case No. 11-13450) on Oct. 30, 2011,
in Delaware. Brown Rudnick and Potter Anderson & Corroon serve as
the Debtors' counsel. Beacon disclosed assets of $72 million and
debt totaling $47 million, including a $39.1 million loan
guaranteed by the U.S. Energy Department. Beacon built a
$69 million facility with 20 megawatts of balancing capacity in
Stephentown, New York, funded mostly by the DoE loan.
The Debtors tapped Miller Wachman, LLP as auditors, Pluritas, LLC
as intellectual property advisors, CRG Partners Group LLC as
financial advisors.
Beacon Power is the second cleantech company which has been backed
by the U.S. Department of Energy via loan guarantees to fail this
year. The first was Solyndra, which declared Chapter 11
bankruptcy on Sept. 6, 2011.
Roberta A. DeAngelis, the United States Trustee for Region 3,
appointed four unsecured creditors to serve on the Official
Committee of Unsecured Creditors of Beacon Power.
Affiliates that simultaneously sought Chapter 11 protection are
Stephentown Holding LLC (Bankr. D. Del. Case No. 11-13451) and
Stephentown Regulation Services LLC (Bankr. D. Del. Case No.
11-13452).
Beacon Power in February received authorization from the
Bankruptcy Court in Delaware to sell the business to Rockland
Capital LLC. The buyer is paying $30.5 million, including a note
for $25 million and $5.5 million in cash. In addition, The
Woodlands, Texas-based Rockland is giving the U.S. Energy
Department $6.6 million in guarantees and undertakings to provide
funding.
BOOMERANG SYSTEMS: Plans to Offer $10 Million of Securities
-----------------------------------------------------------
Boomerang Systems, Inc., on March 29, 2012, announced that it
intends to offer up to $10 million of its securities in a private
placement, subject to market conditions.
About Boomerang Systems
Headquartered in Morristown, New Jersey, Boomerang Systems, Inc.
(Pink Sheets: BMER) through its wholly owned subsidiary, Boomerang
Utah, is engaged in the design, development, and marketing of
automated racking and retrieval systems for automobile parking and
automated racking and retrieval of containerized self-storage
units.
The Company reported a net loss of $19.10 million for 2011 and a
net loss of $15.78 million during the prior year.
The Company's balance sheet at Dec. 31, 2011, showed $6.89 million
in total assets, $13.76 million in total liabilities, and a
$6.87 million total stockholders' deficit.
Bankruptcy Warning
In the Form 10-K for the year ended Dec. 31 2011, the Company said
its operations may not generate sufficient cash to enable it to
service its debt. If the Company were to fail to make any
required payment under the notes and agreements governing its
indebtedness or fail to comply with the covenants contained in the
notes and agreements, the Company would be in default. The
Company's debt holders would have the ability to require that the
Company immediately pay all outstanding indebtedness. If the debt
holders were to require immediate payment, the Company might not
have sufficient assets to satisfy its obligations under the notes
or the Company's other indebtedness. In such event, the Company
could be forced to seek protection under bankruptcy laws, which
could have a material adverse effect on its existing contracts and
its ability to procure new contracts as well as its ability to
recruit or retain employees. Accordingly, a default could have a
significant adverse effect on the market value and marketability
of the Company's common stock.
BUFFETS INC: Closed Rolling Meadows Outlet on March 25
------------------------------------------------------
JournalOnline reports that the Old Country Buffet in Rolling
Meadows, Delaware, closed on Mar. 25, 2012.
"Sunday was the last full day of work at OCB," the report quotes
Rolling Meadows City Manager Barry Krumstok to the city council as
saying. "The parent company is in bankruptcy and they are closing
all kinds of restaurants in their portfolio." The parent company
is Minnesota-based Buffets, Inc. It filed for bankruptcy in 2008,
came out of Chapter 11 in 2009, and filed again in January 2012.
According to the report, in January in Illinois, the company
closed Old Country Buffets in Northlake, Lombard, Naperville,
Countryside, Joliet, West Dundee, Bradley, and Fairview Hts. In
March, the company shuttered only two restaurants in Illinois: the
Rolling Meadows eatery that was located at 1440 Golf Rd., and one
in Lansing.
About Buffets Inc.
Buffets Inc., the nation's largest steak-buffet restaurant
company, operates 494 restaurants in 38 states, comprised of 483
steak-buffet restaurants and 11 Tahoe Joe's Famous Steakhouse(R)
restaurants, and franchises 3 steak-buffet restaurants in two
states. The restaurants are principally operated under the Old
Country Buffet(R), HomeTown(R) Buffet, Ryan's(R) and Fire
Mountain(R) brands. Buffets employs 28,000 team members and
serves 140 million customers annually.
Buffets Inc. and all of its subsidiaries filed Chapter 11
petitions (Bankr. D. Del. Lead Case No. 12-10237) on Jan. 18,
2012, after it reached a restructuring support agreement with 83%
of its lenders to eliminate virtually all of the Company's roughly
$245 million of outstanding debt. The Debtors are seeking to
reject leases for 83 underperforming restaurants.
Buffets had 626 restaurants when it began its prior bankruptcy
case (Bankr. D. Del. Case Nos. 08-10141 to 08-10158). It emerged
from bankruptcy in April 2009.
Higher gasoline and energy costs, along with a decline in guest
count, have hampered the Debtors' ability to service their long-
term debt and caused a liquidity strain, forcing the Company to
return to Chapter 11 bankruptcy.
In the new Chapter 11 case, Buffets Inc.'s legal advisors are
Paul, Weiss, Rifkind, Wharton & Garrison LLP and Young, Conaway,
Stargatt & Taylor, LLP. The Company's financial advisor is
Moelis, Inc. Epiq Bankruptcy Solutions LLC serves as claims,
noticing and balloting agent.
An ad hoc committee of secured lenders is represented by Willkie
Far & Gallagher LLP and Blank Rome LLP as counsel and Conway, Del
Genio, Gries & Co. as financial advisors. Credit Suisse, as DIP
Agent and Prepetition First Lien Agent, is represented by Skadden
Arps Slate Meagher & Flom as counsel.
The U.S. Trustee has appointed a 5-member Official Committee of
Unsecured Creditors in the Debtors' cases.
BRAINY BRANDS: Delays Form 10-K for 2011
----------------------------------------
The Brainy Brands Company, Inc., 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
compilation, dissemination and review of the information required
to be presented in the Form 10-K for the relevant period has
imposed time constraints that have rendered timely filing of the
Form 10-K impracticable without undue hardship and expense to the
Company. The Company undertakes the responsibility to file such
report no later than fifteen days after its original prescribed
due date.
About Brainy Brands
Suwanee, Ga.-based The Brainy Brands Company, Inc., through its
operating subsidiary, engages in the business of selling
educational DVDs, books, games, and toys for babies, toddlers and
pre-schoolers both domestically and internationally through
retailers under licensing agreements, as well as directly to
customers primarily via internet sales.
The Company reported a net loss of $20.05 million on $530,603
of total revenues for the nine months ended Sept. 30, 2011,
compared with net income of $1.68 million on $341,295 of total
revenues for the same period during the prior year.
The Company's balance sheet at Sept. 30, 2011, showed
$1.60 million in total assets, $18.54 million in total
liabilities, and a $16.93 million total shareholders' deficit.
Habif, Arogeti & Wynne, LLP, in Atlanta, Ga., expressed
substantial doubt about The Brainy Brands' ability to continue as
a going concern, following the Company's 2010 results. The
independent auditors noted that the Company has incurred
significant operating losses and has a net capital deficiency.
BROWNIE'S MARINE: Incurs $3.7 Million Net Loss in 2011
------------------------------------------------------
Brownie's Marine Group, Inc., filed with the U.S. Securities and
Exchange Commission its annual report on Form 10-K disclosing a
net loss of $3.77 million on $2.20 million of total net revenues
in 2011, compared with a net loss of $1.18 million on
$2.18 million of total net revenues in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $1.97 million
in total assets, $2.74 million in total liabilities and a $762,401
total stockholders' deficit.
For 2011, L.L. Bradford & Company, LLC, in Las Vegas, Nevada,
noted that the Company has a working capital deficiency and
recurring losses and will need to secure new financing or
additional capital in order to pay its obligations, all of which
raise substantial doubt about the Company's ability to continue as
a going concern.
Bankruptcy Warning
According to the Form 10-K, if the Company fails to raise
additional funds when needed, or do not have sufficient cash flows
from sales, the Company may be required to scale back or cease
operations, liquidate its assets and possibly seek bankruptcy
protection.
A copy of the Form 10-K is available for free at:
http://is.gd/nDko4a
About Brownie's Marine
Brownie's Marine Group, Inc. (OTC BB: BWMG) --
http://www.brownismarinegroup.com/-- designs, tests, manufactures
and distributes recreational hookah diving, yacht based scuba air
compressor and nitrox generation systems, and scuba and water
safety products. BWMG sells its products both on a wholesale and
retail basis, and does so from its headquarters and manufacturing
facility in Fort Lauderdale, Florida.
CAMBIUM LEARNING: S&P Lowers CCR to 'B-' on Sharp EBITDA Drop
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on Dallas,
Texas-based Cambium Learning Group Inc. to 'B-' from 'B'. The
rating outlook is stable.
"In conjunction with the downgrade, we lowered our rating on the
company's senior secured notes to 'B-' from 'B'. The recovery
rating on this debt remains at '4', indicating our expectation of
average (30% to 50%) recovery for noteholders in the event of a
payment default," S&P said.
"The downgrade reflects weaker-than-anticipated fourth-quarter
operating performance, rising debt leverage, and Standard & Poor's
concern that strained government budgets will continue to
negatively affect the company's profitability and debt leverage,"
explained Standard & Poor's credit analyst Hal Diamond. "In
addition, federal funding for the intervention and special
education market niche related to the economic stimulus program
ended in September 2011."
"The 'B-' corporate credit rating on Cambium Learning Group Inc.
reflects Standard & Poor's Ratings Services' expectation that
leverage will remain relatively high, based on high product
development costs and the weak outlook for education spending. We
consider the company's business risk profile as 'vulnerable,'
according to our criteria, owing to the cyclicality of government
funding for educational services and the effect of the cyclicality
on the company's operating performance. Relatively high debt to
EBITDA and weak discretionary cash flow, reflecting ongoing high
product development spending, support our view that Cambium's
financial risk profile is 'highly leveraged.' Revenue growth may
underperform other players in the company's supplemental
publishing market," S&P said.
Cambium has a niche competitive position as a provider of
supplemental educational products for the growing market serving
underperforming and special education students. The company has
higher leverage and a smaller presence in faster-growing
technology-delivered content, potentially putting it at a
competitive disadvantage with respect to content investment.
Roughly 18% of sales is derived from two states--California and
Florida--which face budgetary pressure and could materially reduce
their purchases. The intervention market draws heavily from
federal funding, accounting for roughly half of revenues, versus
only about 10% for traditional kindergarten-through-12th grade
publishers.
"Under our base-case scenario, we expect revenues to decline at a
mid- to high-single-digit percentage rate in 2012 and 2013, and
EBITDA to fall in the mid-teens area. Over the intermediate term,
the company may face increased competition from traditional
textbook publishers, which may increase their offerings of
intervention products as part of their core programs. We
anticipate that the EBITDA margin will decline to under 19% in
2012, from roughly 20% in 2011," S&P said.
"Conversion of EBITDA to discretionary cash flow improved to
roughly 80% in 2011 versus 20% in 2010 as a result of the
collection of significant prior-year accounts receivable balances.
We expect the conversion of EBITDA to discretionary cash flow to
decline to roughly 20% in 2012 because of weaker operating
performance and a full year of interest on the 9.75% senior
secured notes issued in February 2011," S&P said.
CAPSALUS CORP: Delays Form 10-K for 2011
----------------------------------------
Capsalus Corp. notified 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's
accountants have not completed their audit of the Company's
internally generated financial statements for the 12 months period
ended Dec. 31, 2011.
About Capsalus Corp.
Atlanta, Ga.-based Capsalus Corp. offers a broad range of
solutions to global health problems. WhiteHat Holdings, LLC, was
acquired on April 14, 2010. In combining with WhiteHat, the
Company is creating a new, consumer-driven business unit, the
Nutritional Products Division, focused on healthy food and
beverages.
The Company reported a net loss of $16.02 million in 2010 and a
net loss of $10.89 million in 2009. The Company also reported a
net loss of $2.09 million for the nine months ended Sept. 30,
2011.
The Company's balance sheet at Sept. 30, 2011, showed
$4.60 million in total assets, $6.77 million in total liabilities,
and a $2.16 million total stockholders' deficit.
As reported by the TCR on April 21, 2011, Moquist Thorvilson
Kaufmann Kennedy & Pieper LLC, in Edina, Minnesota, 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 losses
from operations since its inception.
CENTENE CORP: S&P Affirms 'BB' Counterparty Credit Rating
---------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Centene
Corp. (CNC) to positive from stable. "At the same time, we
affirmed our 'BB' long-term counterparty credit and senior
unsecured debt ratings on the company," S&P said.
"The rating affirmation reflects our expectation that Centene will
sustain recent positive developments in its business and financial
profiles," said Standard & Poor's credit analyst Hema Singh.
"These developments have improved the company's overall
creditworthiness and, if sustained, will support a higher rating."
"Centene has achieved a leading position in the managed Medicaid
market. The company continues to expand its presence, and as of
March 2012 has contracts with 15 states to manage their Medicaid
programs. The increased market presence has enhanced Centene's
geographic diversity, resulting in a more stable earnings profile
and reduced exposure to adverse developments from the loss of
contracts in any one market," S&P said.
"Our counterparty credit rating on Centene is constrained by the
concentration of its revenue stream in the government-sponsored
manage Medicaid programs, with a smaller percentage of premiums
coming from specialty services from external customers. This
narrow market focus is a key credit risk, as it exposes the
company to adverse regulatory and legislative developments.
Accordingly, profitability and sustained revenue growth depend
heavily on continued government funding for these programs to keep
pace with medical cost trends," S&P said.
"The positive outlook indicates that we might raise our
counterparty credit rating by one notch during the next 12 months
if Centene continues its very good operating performance (EBIT ROR
of 3%-4% in 2012) and continues to grow its revenue. Although
unlikely, we could lower the rating by one notch if the company's
EBIT ROR were to decline to less than 2% for a sustained period or
if the loss of one or more of its managed Medicaid contracts
results in a significant decline in revenue or cash flow from
operations," S&P said.
"From a key rating factors perspective, we expect the company to
continue to grow and generate stable cash flow in the intermediate
term (12 to 24 months) to meet its debt-service requirements and
pay for expenses related to expansion into new markets. In
addition, we expect the company to keep its debt-to-capital ratio
consistent with recent improvements in the 20%-30% range--barring
any large acquisitions. We expect EBITDA interest coverage to
remain more than 10x and redundancy of statutory capitalization to
stay at the 'BBB' level of confidence as per our capital model. We
remain cautious that any significant funding cuts and continued
pressure from reimbursement rate compression by states to save
money could erode the earnings power from the managed Medicaid
sector. Benefits structure and eligibility have to be aligned
with reimbursement levels," S&P said.
CENTENNIAL BLUFF: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Centennial Bluff, LLC
1411 Highway 35, Suite 200
Asbury Park, NJ 07712
Bankruptcy Case No.: 12-31331
Chapter 11 Petition Date: March 28, 2012
Court: United States Bankruptcy Court
Eastern District of Tennessee (Knoxville)
Judge: Richard Stair Jr.
Debtor's Counsel: Keith L Edmiston, Esq.
GRIBBLE CARPENTER & ASSOCIATES, PLLC
372 S. Washington Street
Maryville, TN 37804
Tel: (865) 980-7700
Fax: (865) 980-7717
E-mail: kle@gribblecarpenter.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $10,000,001 to $50,000,000
A copy of the list of 20 largest unsecured creditors is
available for free at http://bankrupt.com/misc/tneb12-31331.pdf
The petition was signed by Bruce Matzel, chief manager.
CENTRE PLAZA INVESTORS: Files for Chapter 11 in San Antonio
-----------------------------------------------------------
Centre Plaza Investors, LLC, filed a bare-bones Chapter 11
petition (Bankr. W.D. Tex. Case No. 12-50982) in its home-town in
San Antonio, Texas.
Rakhee V. Patel, Esq., at Pronske & Patel, PC, in Dallas, serves
as counsel.
The Debtor estimated assets and debts of up to $50 million and
projects that funds will be available for distribution to
unsecured creditors.
The Debtor has an address of 45 N.E. Loop 410, San Antonio, Texas.
According to http://www.loopnet.com/ that address is the location
of Centre Plaza, a 138,265-square-foot office building. The
building, considered a class A, was built 1982. Seventeen spaces
are available for rent at the building for $19.50 per square-foot
per year.
CHARTER COMMS: Moody's Rates $1.1-Bil. First Lien Revolver 'Ba1'
----------------------------------------------------------------
Moody's Investors Service assigned a Ba1 rating to the proposed
$1.1 billion first lien revolver and $750 million first lien term
loan of Charter Communications Operating LLC (CCO). The company
expects to use proceeds primarily to refinance existing first lien
bank debt of CCO, including term loans maturing in 2014
(approximately $88 million), a portion of the term loan maturing
in 2016 (approximately $662million), and borrowings under the
existing revolver, which matures in 2015 (approximately $230
million).
The transaction continues Charter's trend of extending its
maturity profile and moderating interest expense, and Moody's also
affirmed the Ba3 corporate family rating of CCH II, LLC (legal
entity at which Moody's houses the benchmark fundamental Corporate
Family Rating). Moody's continues to consider Charter's liquidity
profile good and the SGL-2 speculative grade liquidity rating
appropriate, supported by revolver capacity and internally
generated cash flow.
The transaction does not incorporate a meaningful shift in the mix
of debt capital. Moody's affirmed instrument ratings and adjusted
LGD point estimates to reflect recent tender activity, which came
in largely in line with expectations. Moody's continues to
maintain the Ba1 rating on the first lien bank debt as Moody's
anticipates Charter will persist in streamlining its capital
structure, including the repayment of high coupon debt at CCH II,
LLC, which could result in incremental first lien bank debt and
reduced junior capital for bank lenders. The CCO credit facilities
permit a term loan up to $7.5 billion and a revolver up to $1.75
billion.
A summary of the action follows.
CCH II, LLC
Affirmed Ba3 Corporate Family Rating
Affirmed Ba3 Probability of Default Rating
Affirmed SGL-2 Speculative Grade Liquidity Rating
Charter Communications Operating, LLC
$750M First Lien Term Loan due 2019, Assigned Ba1, LGD2, 16%
$1,100M First Lien Revolving Credit Facility due 2017,
Assigned Ba1, LGD2, 16%
Affirmed Ba1, LGD2, 16% on $1,300 million Sr Sec 1st Lien
Revolving Credit Facility due March 2015 (to be WR on close
of proposed transaction)
Affirmed Ba1, LGD2 16% on $199 Million Sr Sec 1st Lien Non-
Revolving Credit Facility due 2013
Affirmed Ba1, LGD2 16% on $750 Million Sr Sec 1st Lien Term
Loan due May 2017
Affirmed Ba1, LGD2 16%, on Sr Sec 1st Lien Term Loan B-1
(approximately $78 million outstanding, to be WR on close of
proposed transaction) due March 2014
Affirmed Ba1, LGD2 16%, on Sr Sec 1st Lien Term Loan B-2
(approximately $10 million outstanding, to be WR on close of
proposed transaction) ) due March 2014
Affirmed Ba1, LGD2 16%, Sr Sec 1st Lien Term Loan C
(approximately $2.3 billion outstanding pro forma proposed
transaction) due Sept 2016
Affirmed Ba2 on 8% Sr Sec 2nd Lien Nts due 2012
(approximately $200 million outstanding), LGD adjusted to
LGD3, 33% from LGD3, 35%
CCH II, LLC
13.5% Senior Unsecured Bonds due 2016, Affirmed B2, LGD6, 95%
CCO Holdings, LLC
$750 million bonds due January 2022, affirmed B1, LGD
adjusted to LGD4, 68% from LGD4, 69%
$1.5 billion 6.5% Sr Unsec Nts due 2021, affirmed B1, LGD
adjusted to LGD4, 68% from LGD4, 69%
$750 million 7.375% Sr Unsec Nts due 2020, affirmed B1, LGD
adjusted to LGD4, 68% from LGD4, 69%
$700 million of 8.125% Sr Unsec Nts due 2020, affirmed B1,
LGD adjusted to LGD4, 68% from LGD4, 69%
$1,400 million (including add-on) 7% Sr Unsec Nts due 2019,
affirmed B1, LGD adjusted to LGD4, 68% from LGD4, 69%
$900 million of 7.875% Sr Unsec Nts due 2018, affirmed B1,
LGD adjusted to LGD4, 68% from LGD4, 69%
$1,000 million 7.25% Sr Unsec Nts due 2017, affirmed B1,LGD
adjusted to LGD4, 68% from LGD4, 69%
$350 million Sr Sec 1st Lien (but CCO stock only, so
effectively 3rd Lien) Credit Facility due 2014, Affirmed Ba2,
LGD adjusted to LGD3, 35% from LGD3, 37%
Ratings Rationale
Charter's Ba3 corporate family rating continues to reflect its
moderately high financial risk, with leverage of about 5 times
debt-to-EBITDA. This leverage poses risk considering the pressure
on revenue from its increasingly mature core video offering (which
represents about half of total revenue) and the intensely
competitive environment in which it operates. The company's
substantial scale and Moody's expectations for continued
operational improvements and growth in high speed data and
commercial customers, along with the meaningful perceived asset
value associated with its sizeable (over 5 million) customer base,
support the rating.
The positive outlook continues to reflect Charter's steadily
improving credit profile and expectations that its enhanced
financial flexibility will afford the company greater opportunity
to invest without raising incremental debt, which should increase
asset value and facilitate further balance sheet strengthening
over time.
Moody's would consider an upgrade with continued improvements in
both financial and operating metrics and a commitment to a better
credit profile. Specifically, Moody's could upgrade the CFR based
on expectations for sustained leverage below 4.5 times debt-to-
EBITDA and free cash flow-to-debt in excess of 5%, along with
maintenance of good liquidity. A higher rating would require
clarity on fiscal policy, as well as product penetration levels
more in line with industry averages and growth in revenue per
homes passed.
Given the positive outlook, limited downward ratings pressure
exists over the near term. However, Moody's would likely downgrade
ratings if ongoing basic subscriber losses, declining penetration
rates, and/or a reversion to more aggressive financial policies
contributed to expectations for leverage above 6 times debt-to-
EBITDA and / or low single digit or worse free cash flow-to-debt.
One of the largest domestic cable multiple system operators
serving approximately 4.1 million basic video customers (5.2
million customers in total), Charter Communications, Inc.,
maintains its headquarters in St. Louis, Missouri. Its annual
revenue is approximately $7 billion.
The principal methodology used in rating Charter Communications
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.
CHARTER COMMS: Fitch Rates $1.1 Billion Credit Facility 'BB+'
-------------------------------------------------------------
Fitch Ratings has assigned a 'BB+' rating to Charter
Communications Operating, LLC's (CCO) proposed five-year,
$1.1 billion revolving credit facility and its seven-year,
$750 million term loan D.
Proceeds from the term loan D will be used to refinance amounts
outstanding under the company's existing term loan B-1 ($78
million outstanding) and term loan B-2 ($10 million outstanding)
and repay a portion of its term loan C ($3 billion outstanding).
The company is expected to use proceeds from the new revolving
credit facility to repay amounts outstanding under the existing
$1.3 billion extended revolving credit facility and pay related
transaction expenses.
CCO is an indirect wholly owned subsidiary of Charter
Communications, Inc. (Charter) Charter had approximately $12.8
billion of debt (principal value) outstanding including $3.9
billion of senior secured debt as of Dec. 31, 2011.
The new credit facilities, along with the successful cash tender
offers completed earlier this year are a modest positive for
Charter's credit profile. The transactions are in line with the
company's overall financial strategy to simplify its capital
structure and extend its maturity profile. Fitch continues to
expect Charter's debt structure will evolve into a more
traditional hold-co/op-co structure, with senior unsecured debt
issued by CCOH and senior secured debt issued by CCO, while
eliminating the second lien tier of the company's debt structure
and reducing Charter's overall reliance on secured debt.
Charter's liquidity position is adequate given the current rating
and is primarily supported by the borrowing capacity from CCO's
new $1.1 billion revolver (availability of approximately $785
million upon closing) and expected free cash flow generation.
Commitments under the new revolver are expected to expire during
April 2017. After considering the results of the debt tenders
completed in February 2012, the $500 million draw from COO's term
loan A credit facility as well as the new term loan D, Charter had
approximately $230 million of debt scheduled to mature during 2012
followed by $267 million in 2013 and $418 million in 2014.
Fitch's ratings incorporate Charter's more viable capital
structure, increased financial flexibility and stable liquidity
profile. Additionally the ratings are supported by Charter's size
and scale as the fourth largest cable MSO in the United States.
Fitch believes that Charter's capital structure along with a
relatively stable operating profile positions the company to
generate sustainable amounts of free cash flow (FCF, defined as
cash flow from operations less capital expenditures and
dividends). Charter generated approximately $426 million of FCF
during 2011, which followed approximately $702 million of FCF
during 2010. Higher interest costs and increased cash requirement
for working capital purposes have pressured FCF generation during
2011. Fitch anticipates 2012 FCF generation will be similar to
the company's 2011 FCF levels.
Ratings concerns center on Charter's elevated financial leverage
(relative to other large cable multiple system operators [MSOs]),
a comparatively weaker subscriber clustering profile and service
penetration rates that lag behind industry leaders. Moreover
Charter's ability to adapt to the evolving operating environment
while maintaining its relative competitive position given the
challenging competitive environment and weak housing and
employment trends remains a key consideration. Importantly
Charter continues to deploy DOCSIS 3.0 and switched digital video
throughout its cable plant, which positions the company to
efficiently manage its cable plant bandwidth innovate its service
offerings.
Fitch believes that Charter's financial strategy will begin to
shift from its balance sheet to enhancing shareholder returns
during 2012 given that the company is approaching its leverage
target of between 4 times (x) and 4.5x. During the course of
2011, Charter repurchased approximately $733 million of its shares
through private transactions and board approved share repurchase
programs. Debt outstanding as of year end 2011 totaled
approximately $12.8 billion (principal value), of which 31% was
senior secured. Leverage for the year ended 2011 was 4.8x. Fitch
estimates pro forma leverage, adjusting for the tenders and new
credit facilities, is 4.9x as of Dec. 31, 2011. Fitch believes
that Charters credit profile will improve modestly during the
ratings horizon with leverage declining to 4.5x by the end of 2012
and approach 4.2x by the end of 2014. Fitch anticipates the
company will reduce debt from approximately $13 billion (pro forma
for transactions) to approximately $12.6 billion during 2012
reflecting schedule credit facility amortization.
The Stable Outlook reflects Fitch's belief that the company will
continue to extend its maturity schedule and Fitch's expectation
that Charter's operating profile will not materially decline
during the near term in the face of competition and poor housing
and employment conditions.
Positive rating actions would be contemplated as leverage declines
below 4.5x, and the company demonstrates progress in closing gaps
relative to its industry peers on service penetration rates and
strategic bandwidth initiatives. Fitch believes that negative
rating actions would likely coincide with a leveraging
transaction, the adoption of a more aggressive financial strategy,
or a perceived weakening of Charter's competitive position.
CHINA EXECUTIVE: Corrects Misstatements in 2010 Report
------------------------------------------------------
China Executive Education Corp. filed on March 27, 2012, Amendment
No. 3 to its annual report on Form 10-K for the fiscal year ended
Dec. 31, 2010, originally filed on April 15, 2011, to correct
prior material misstatements for the years ended Dec. 31, 2010,
and 2009.
The restatements are non-cash related, and relate to following
accounting issues:
1) The Company recognized its revenue based on invoices issued for
courses other than those delivered in the years ended Dec. 31,
2010, and 2009, which resulted in overstatement of the net
revenues for these two years. In the restatement, the Company
reversed the improperly recognized revenue and recorded as
deferred revenue;
2) The Company only consolidated 90% controlling interest of the
variable interests entity (the "VIE") and recognized 10% as
noncontrolling interest in years ended Dec. 31, 2010, and 2009.
Pursuant to the VIE agreements, the Company should be the primary
beneficiary of the VIEs and consolidate the VIEs entirely. This
error was corrected in the restatement;
3) The Company failed to disclose its VIEs in accordance to
Accounting Standard Codification (the "ASC") 810-10-45 and 50 in
the years ended Dec. 31, 2010, and 2009. The disclosure is
amended in the restatement;
4) Under and over accrual for certain liabilities as well as
expenses; and
5) Certain accounts were improperly classified.
The net effect on net income attributable to the Company's
shareholders for the years ended Dec. 31, 2010, and 2009, were to
decrease net income by approximately $11.14 million and
$4.72 million, respectively.
Albert Wong & Co., in Hong Kong, expressed substantial doubt about
China Executive Education's ability to continue as a going concern
after auditing the Company's 2010 financial statements. The
independent auditors noted that the Company has accumulated
deficits as at Dec. 31, 2010, of $11,988,690 including net losses
of $8,543,070 for the year ended Dec. 31, 2010.
The Company had a restated net loss of $8.54 million on
$7.24 million of revenues for 2010, compared with a restated net
loss of $2.04 million on $4.28 million of revenues for 2009.
The Company's restated balance sheet at Dec. 31, 2010, showed
$15.20 million in total assets, $25.67 million in total
liabilities, and a stockholders' deficit of $10.47 million.
A copy of the Form 10-K/A is available for free at:
http://is.gd/Ywtdjf
Hangzhou, China-based China Executive Education Corp. is an
executive education company with operations in Hangzhou and
Shanghai, China. It operates comprehensive business training
programs that are designed to fit the needs of Chinese
entrepreneurs and to improve their leadership, management and
marketing skills, as well as bottom-line results.
CHINA GREEN: Delays Filing of 2011 Report
-----------------------------------------
China Green Creative, Inc., notified the U.S. Securities and
Exchange Commission that it will be delayed in filing its Annual
Report on Form 10-K for the period ended Dec. 31, 2011. The
Company did not obtain all the necessary information prior to the
filing date and the attorney and accountant could not complete the
required legal information and financial statements and management
could not complete the Management's Discussion and Analysis of
such financial statements prior to May 16, 2011.
About China Green
Shenzhen, China-based China Green Creative, Inc., a Nevada
Corporation, was incorporated on Aug. 17, 2006, under the name of
Glance, Inc. On Jan. 21, 2009, the Company changed its name to
China Green Creative, Inc. CGC and its subsidiaries are
principally engaged in the distribution of consumer goods in the
People's Republic of China.
The Company's balance sheet at Sept. 30, 2011, showed
$5.25 million in total assets, $7.46 million in total liabilities,
and a $2.21 million total stockholders' deficit.
Madsen & Associates CPA's, Inc., in Salt Lake City, says China
Green Creative, Inc., does not have the necessary working capital
to service its debt and for its planned activity, which raises
substantial doubt about the Company's ability to continue as a
going concern.
CHRYSLER LLC: Court Rules on Sec. 747 Relief for Dealers
--------------------------------------------------------
Following the 2009 bankruptcies of Chrysler LLC and General Motors
Corporation, and actions taken to consolidate their dealer
networks, Congress enacted Section 747 of the Consolidated
Appropriations Act of 2010, Pub. L. No. 111-117. That Act was
passed to grant certain arbitration rights to dealerships that
were rejected or terminated in connection with those bankruptcies.
Several dealers who had been rejected by Old Chrysler initiated,
and prevailed in, Section 747 arbitrations with Chrysler Group
LLC. Those arbitration determinations have given rise to
litigation because the parties disagree as to what happens next
following those Section 747 arbitration determinations.
In addition to New Chrysler, there are two different groups of
dealers who are parties to the action. First, there are eight
dealers whose franchise agreements were rejected by Old Chrysler
and who prevailed in Section 747 arbitrations with New Chrysler
that are currently parties in the consolidated actions: 1) Livonia
Chrysler Group LLC; 2) Village Chrysler Jeep, Inc. d/b/a Village
Automotive Center; 3) Fox Hills Motor Sales, Inc. d/b/a Fox Hills
Chrysler Jeep; 4) Boucher Imports, Inc. d/b/a Frank Boucher
Chrysler; 5) Jim Marsh American Corp.; 6) Spitzer Autoworld Akron,
LLC; 7) BGR, LLC d/b/a Deland Dodge; and 8) Sowell Automotive,
Inc., d/b/a Dodge City Chrysler Jeep.
Second, there are a number of existing dealers who are parties to
the action because they oppose New Chrysler establishing or
relocating a dealer who prevailed in a Section 747 arbitration
into their area without following the provisions of state-law
dealer acts. The Interested Dealers include: 1) Crestwood Dodge,
Inc., who opposes Livonia; 2) Fred Martin Motor Co., who opposes
Spitzer; 3) Falls Motor City, Inc., who opposes Spitzer; and 4)
Hurley Chrysler Jeep, Inc., who opposes BGR.
Before the Court are 15 dispositive motions filed by the parties,
raising the common issue of what relief is provided by Section 747
to a dealer rejected by Old Chrysler who prevails in a Section 747
arbitration with New Chrysler. The motions also raise the common
issue of whether Section 747 preempts state-law dealer acts. The
parties have extensively briefed the issues and the Court finds
that oral argument would not aid the decisional process.
In a March 27, 2012 Opinion and Order, District Judge Sean F. Cox
ruled that: 1) The sole and exclusive remedy for a dealer rejected
by Old Chrysler who prevails in a Section 747 arbitration with New
Chrysler is a customary and usual letter of intent to enter into a
sales and service agreement with New Chrysler; 2) Section 747 does
not provide for reinstatement of a dealer rejected by Old Chrysler
who prevails in a Section 747 arbitration with New Chrysler; 3)
Section 747 does not authorize an award of monetary damages; 4)
Section 747 does not provide for judicial confirmation or
enforcement and neither the FAA nor the AAA's Commercial Rules
govern these statutorily-mandated arbitrations or authorize a
party to move to confirm an arbitrator's determination in a
Section 747 arbitration; and 5) Section 747 does not preempt the
state-law dealer acts that govern the relationships between
automobile manufacturers and dealers in California (Cal. Vehicle
Code Sec. 3060 et seq.), Florida (Fla. Stat. Sec. 320.01 et seq.),
Michigan (Mich. Comp. Laws Sec. 445.1561 et seq.), Nevada (Nev.
Rev. Stat. Sec. 482.36311 et seq.), Ohio (Ohio Rev. Code. Sec.
4517.43), or Wisconsin (Wis. Stat Sec. 218.0101et seq.).
The District Court ruled that all motions requesting oral argument
on the pending motions to dismiss or for summary judgment are
denied.
The Court will hold a Status/Scheduling Conference to discuss the
most efficient method of adjudicating the remaining claims in the
action, on May 14, 2012, at 3:00 p.m.
The cases are Chrysler Group LLC, Plaintiff, v. South Holland
Dodge, Inc., et al., Defendants; Consolidated with Livonia
Chrysler Jeep, Inc., a Michigan for profit corporation, Plaintiff,
v. Chrysler Group, LLC, et al., Defendants; Consolidated with
Chrysler Group LLC, Plaintiff, v. Sowell Automotive, Inc., et al.,
Defendants, Case Nos. 10-12984, 10-13290, 10-13908 (E.D. Mich.).
A copy of the District Court's March 27, 2012 Opinion and Order is
available at http://is.gd/9vS8oNfrom Leagle.com.
CHURCH STREET: Files Schedules of Assets and Liabilities
--------------------------------------------------------
Church Street Health Management, LLC, filed with the U.S.
Bankruptcy Court for the Middle District of Tennessee its
schedules of assets and liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $0
B. Personal Property $8,782,978
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $235,529,801
E. Creditors Holding
Unsecured Priority
Claims $531
F. Creditors Holding
Unsecured Non-priority
Claims $23,607,147
----------- -----------
TOTAL $8,782,978 $259,137,479
Debtor-affiliates also filed their respective schedules,
disclosing:
Company Assets Liabilities
------- ------ -----------
FORBA Services, Inc. $2,284 $235,587,924
Small Smiles Holding Company, LLC $0 $237,103,320
EEHC, Inc. $7,345 $237,230,698
FORBA NY, LLC $13,999 $235,543,594
Full-text copies of the schedules are available for free at:
http://bankrupt.com/misc/CHURCH_STREET_forbaservices_sal.pdf
http://bankrupt.com/misc/CHURCH_STREET_eehc_sal.pdf
http://bankrupt.com/misc/CHURCH_STREET_forba_sal.pdf
http://bankrupt.com/misc/CHURCH_STREET_sal.pdf
http://bankrupt.com/misc/CHURCH_STREET_smallsmiles_sal.pdf
About Church Street
Church Street Health Management, LLC, a provider of management
services for 67 dental practices in 22 states, filed a Chapter 11
petition (Bankr. M.D. Tenn. Case No. 12-01573) in Nashville,
Tennessee on Feb. 20, 2012.
The following day, four affiliates, Small Smiles Holding Company,
LLC, Forba NY, LLC, EEHC, Inc., and Forba Services, LLC, filed
their Chapter 11 petitions (Case Nos. 12-01574 to 12-01577).
As of the Petition Date, the Debtors' assets have book value of
$895 million, with debt totaling $303 million. There is about
$131.5 million owing on first-lien obligations, plus $25.6 million
on a second-lien obligation. There is an additional $152 million
on three subordinated debts. The company's finances are
structured to comply with Islamic Shariah financing regulations.
In the Chapter 11 cases, the Debtors have engaged Waller Lansden
Dortch & Davis, LLP as bankruptcy counsel, and Alvarez & Marsal
Healthcare Industry Group, LLC, as financial and restructuring
advisor. Martin McGahan, a managing director at A&M, will serve
as chief restructuring officer of Church Street. Morgan Joseph
TriArtisan, LLC, is the investment banker. Garden City Group is
the claims and notice agent.
Garrison Investment Group is providing funding for the Chapter 11
case. The credit agreement will provide the Debtor with up to an
aggregate principal amount of $12 million in a revolving credit
facility.
CIRCUS AND ELDORADO: Suspending Filing of Reports with SEC
----------------------------------------------------------
Circus and Eldorado Joint Venture and Silver Legacy Capital Corp.
filed a Form 15 notifying of their suspension of their duty under
Section 15(d) to file reports required by Section 13(a) of the
Securities Exchange Act of 1934 with respect to its their 10 1/8%
Mortgage Notes due 2012. Pursuant to Rule 12h-3, the Companies
are suspending reporting because there are currently less than 300
holders of record of the Notes. There were only 36 holders of the
Notes as of March 29, 2012.
About Circus and Eldorado
Reno, Nevada-based Circus and Eldorado Joint Venture, doing
business as Silver Legacy Resort Casino, owns and operates the
Silver Legacy Resort Casino, a themed hotel-casino and
entertainment complex in Reno, Nevada. Silver Legacy is a leader
within the Reno market, offering the largest number of table
games, the second largest number of hotel rooms and the third
largest number of slot machines of any property in the Reno
market.
The Company reported a net loss of $4.0 million on $95.6 million
of revenues for nine months ended Sept. 30, 2011, compared with a
net loss of $3.7 million on $95.1 million of revenues for the same
period last year.
The Company's balance sheet at Sept. 30, 2011, showed
$267.8 million in total assets, $165.4 million in total
liabilities, and partners' equity of $102.4 million.
* * *
As reported by the TCR on March 7, 2012, Standard & Poor's Ratings
Services lowered its corporate credit rating on Reno-based gaming
operator Circus And Eldorado Joint Venture (CEJV), and its issue-
level rating on CEJV's $143 mortgage notes, to 'D' from 'CCC-'.
The rating action followed CEJV's failure to repay the principal
on its mortgage notes at maturity.
"The rating action stems from CEJV's inability to successfully
repay the principal on its mortgage notes, due March 1, 2012,
which constitutes a default under the terms of the notes'
indenture. CEJV is in continuing discussions with potential
financing sources and the holders of the notes regarding a
restructuring of its obligations under the notes and has entered
into a forbearance agreement with a substantial holder of the
outstanding notes. CEJV is a joint venture of affiliates of MGM
Resorts International and Eldorado Resorts LLC. CEJV owns and
operates a single property, the Silver Legacy Resort Casino in
Reno," S&P said.
In the March 7, 2012, edition of the TCR, Moody's Investors
Service lowered Circus and Eldorado Joint Venture's Probability of
Default Rating to D from Ca. This rating action follows Circus
and Eldorado's announcement in an 8-K filing dated March 1, 2012
that the company did not make the required principal payment of
its 10.125% mortgage notes on the maturity date of March 1, 2012.
The company also elected not to make the scheduled interest
payment.
CITGO PETROLEUM: Ex Baltimore Convenience Store to be Auctioned
---------------------------------------------------------------
National Commercial Auctioneers disclosed the foreclosure auction
of a former Citgo gas station in Baltimore, Md., on April 24,
2012, at 11am local time, according to Fernando Palacios, Regional
Vice President and Broker.
"This is an excellent business opportunity or investment," said
Palacios. "This former Citgo brand station has a 2,253 square foot
convenience store and is located on a busy street with a high
traffic count."
Located at 6100 Moravia Park Drive, the property is located within
one mile of I-95 and I-895 in Baltimore. The gas station is
equipped with a security surveillance camera, two pumps, and a
canopy that extends over both pumping stations. Each pump has two
multi-product dispensers, two regular hoses and two diesel hose
attachments, making a total of eight hoses.
Three underground 8,000 gallon storage tanks allow the flexibility
of storing multiple grades of fuel. The 0.81 acre lot has ample
parking for additional revenue as a truck rental location.
"The state of Maryland has inspected this property and given it a
clean environmental report," noted Palacios. "There are no
contamination issues and this property is in compliance with
current regulatory requirements."
Broker participation is encouraged. Property may be inspected
during scheduled previews or by appointment. The auction will be
conducted on-site. For more details on how to receive the
property information package and complete terms visit
http://www.natcomauctions.comor call (877) 895-7077.
About Citgo Petroleum
Headquartered in Houston, Texas, Citgo Petroleum Corp. --
http://www.citgo.com/-- is owned by PDV America, an indirect,
wholly owned subsidiary of Petroleos de Venezuela S.A., the
state-owned oil company of Venezuela.
* * *
As of May 11, 2010, Fitch Ratings has affirmed these existing
ratings of CITGO Petroleum Corporation:
-- Issuer Default Rating (IDR) at 'B+';
-- Senior Secured Credit Facility at 'BB+';
-- Secured Term Loan at 'BB+';
-- Fixed-Rate Industrial Revenue Bonds (IRBs) at 'BB+'.
CLARE AT WATER: Creditors' Proofs of Claim Due April 20
-------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
has established April 20, 2012, at 5:00 p.m. (prevailing Central
Time) as the deadline for any individual or entity to file proofs
of claim against The Clare at Water Tower.
The Court also set May 14, at 5:00 p.m. as the governmental bar
date.
Each original proof of claim, including supporting documentation,
must be filed by
a) first class U.S. mail to:
The Clare at Water Tower Claims Processing Center
c/o Epiq Bankruptcy Solutions, LLC
FDR Station
P.O. Box 5011
New York, NY 10150-5011
b) hand delivery or overnight mail to:
The Clare at Water Tower Claims Processing Center
c/o Epiq Bankruptcy Solutions, LLC
757 Third Avenue, 3rd Floor
New York, NY 10017
About The Clare at Water Tower
The Clare at Water Tower is an upscale 334-unit high-rise
continuing-care retirement community in Chicago, Illinois. The
project is only 42% occupied because the target population either
hasn't been able to sell homes or lacks sufficient cash to make
required deposits as the result declining investments following
the recession. The facility is a 53-story building on land rented
from Loyola University of Chicago. The facility is managed and
developed by a unit of the Franciscan Sisters of Chicago, who
invested more than $14 million. The project opened in December
2008. Residents must make partially refundable deposits ranging
from $263,000 to $1.2 million. Monthly fees are an additional
$2,700 to $5,500.
The Clare filed for Chapter 11 protection (Bankr. N.D. Ill. Case
No. 11-46151) on Nov. 14, 2011, after defaulting on $229 million
in tax-exempt bond financing used to build the project.
Judge Susan Pierson Sonderby presides over the case. Matthew M.
Murphy, Esq., at DLA Piper LLP, serves as the Debtor's counsel.
Houlihan Lokey Capital, Inc., as its investment banker and
financial advisor. Deloitte Financial Advisory Services LLP
serves as restructuring advisor. Epiq Bankruptcy Solutions serves
as claims and noticing agent. The Debtor, in its amended
schedules, disclosed $56,778,671 in assets and $321,747,63 in
liabilities. The petition was signed by Judy Amiano, president.
The Official Committee of Unsecured Creditors proposed to retain
SNR Denton US LLP as counsel. The Committee also tapped FTI
Consulting, Inc., as its financial advisor.
CLARE AT WATER: Plan Confirmation Hearing Scheduled for April 24
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
will convene a hearing on April 24, 2012, at 2:00 p.m. (prevailing
central time), to consider the confirmation of The Clare at Water
Tower's Third Amended Plan of Reorganization. Objections, if any,
are due April 20, at 5:00 p.m.
Ballots accepting or rejecting the Plan are due April 18.
According to the Disclosure Statement, amended as of March 21,
2012, the Plan provides for (i) the sale of substantially all of
the Debtor's assets pursuant to Chicago Senior Care LLC or the
winning bidder at an auction, and (ii) the Plan Administrator's
subsequent liquidation of the Debtor's remaining Assets,
administration of the Plan and the wind-down of the Debtor and its
Estate post-Effective Date.
On March 9, 2012, the Debtor and Chicago Senior Care, as stalking
horse bidder, executed the Stalking Horse Agreement for the sale
of substantially all of the Debtor's operations to the Stalking
Horse Bidder for a cash purchase price of $29,500,000 and the
assumption of certain specific liabilities (including
approximately $57,000,000 of current and former resident entrance
deposit refund obligations and approximately $121,500 of Parking
Deposits).
The Plan will be funded from the proceeds of the Asset Sale,
including, but not limited to, Sale Proceeds, and all other
remaining assets of the Debtor.
Under the Plan, Administrative Expense Claims, Compensation and
Reimbursement Claims, Priority Tax Claims, Trustee Fees, DIP
Claims, Other Priority Claims, Secured Tax Claims, and Other
Secured Claims will be paid 100% of their claims.
Creditors Variable Rate Bondholder and Fixed Rate Bondholder will
recover 15% of their claims.
General Unsecured Creditors will not receive any distribution on
account of their claims, unless the purchase price for the assets
exceed Chicago Senior Care's stalking-horse offer. There will be
an auction April 12 if qualified-bids are received by the
deadline.
A full-text copy of the Amended Plan is available for free at:
http://bankrupt.com/misc/THE_CLARE_AT_WATER_ds_3rdamendedplan.pdf
About The Clare at Water Tower
The Clare at Water Tower is an upscale 334-unit high-rise
continuing-care retirement community in Chicago, Illinois. The
project is only 42% occupied because the target population either
hasn't been able to sell homes or lacks sufficient cash to make
required deposits as the result declining investments following
the recession. The facility is a 53-story building on land rented
from Loyola University of Chicago. The facility is managed and
developed by a unit of the Franciscan Sisters of Chicago, who
invested more than $14 million. The project opened in December
2008. Residents must make partially refundable deposits ranging
from $263,000 to $1.2 million. Monthly fees are an additional
$2,700 to $5,500.
The Clare filed for Chapter 11 protection (Bankr. N.D. Ill. Case
No. 11-46151) on Nov. 14, 2011, after defaulting on $229 million
in tax-exempt bond financing used to build the project.
Judge Susan Pierson Sonderby presides over the case. Matthew M.
Murphy, Esq., at DLA Piper LLP, serves as the Debtor's counsel.
Houlihan Lokey Capital, Inc., as its investment banker and
financial advisor. Deloitte Financial Advisory Services LLP
serves as restructuring advisor. Epiq Bankruptcy Solutions serves
as claims and noticing agent. The Debtor, in its amended
schedules, disclosed $56,778,671 in assets and $321,747,63 in
liabilities. The petition was signed by Judy Amiano, president.
The Official Committee of Unsecured Creditors proposed to retain
SNR Denton US LLP as counsel. The Committee also tapped FTI
Consulting, Inc., as its financial advisor.
CNL LIFESTYLE: S&P Cuts Corp. Credit Rating to 'B+' on Weak Credit
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
and senior unsecured debt ratings on CNL Lifestyle Properties Inc.
and its subsidiary, CNL Income Partners L.P., (collectively, CNL)
to 'B+' from 'BB-'. "Our recovery rating on CNL's senior unsecured
notes remains a '3', indicating our expectation for a meaningful
recovery (50%-70%) in the event of a payment default. The outlook
remains negative," S&P said.
"The downgrade reflects our expectation that CNL's credit metrics
will not materially improve in 2012 from current lower levels,
which, in our view, are in line with an 'aggressive' financial
risk profile," said credit analyst Eugene Nusinzon. "The company's
weak business risk profile is characterized by volatile cash flow,
low tenant-credit quality, and a high proportion of special-
purpose properties."
"The negative outlook reflects our view that cash flow will remain
under pressure as the company continues to reposition some of its
poorly perfuming investments while also pursuing growth. We would
lower our ratings if we believe trailing 12-months fixed-charge
coverage pro rata for joint ventures will dip below 1.4x,
liquidity remains less than adequate, or the shortfall in coverage
of the cash portion of the common dividend widens over the next
few quarters. We would consider returning the outlook to stable if
new investments bolster overall portfolio quality and performance,
and the company's liquidity position strengthens," S&P said.
COMMERCIAL TRAVELERS: A.M. Beset Places 'B' FSR Under Review
------------------------------------------------------------
A.M. Best Co. has placed the financial strength rating (FSR) of B
(Fair) and the issuer credit rating (ICR) of "bb" of Commercial
Travelers Mutual Insurance Company (Utica, NY) under review with
negative implications.
The rating action reflects Commercial Travelers' weakened
financial position and the recent announcement that it has signed
a Letter of Intent to affiliate with National Guardian Life
Insurance Company (NGL). As part of the potential affiliation,
NGL would provide Commercial Travelers with $5 million in capital
in the form of surplus notes, and intends to coinsure a portion of
the company's accident and health business, which would strengthen
Commercial Travelers' balance sheet and reduce its risk profile.
Under the plan, NGL also would assume control of the company's
board of directors as well as hold some officer positions in the
company. Long term, the affiliation could potentially lead to the
demutualization and acquisition of Commercial Travelers by NGL.
However, at this time no definitive agreement has been signed.
Commercial Travelers' capitalization and operating trends have
declined considerably over the past few years. Surplus has been
negatively impacted by operating losses tied to its student
medical business, high expense structure, as well as the company's
need to fully fund its pension account, which is now frozen. The
potential affiliation with NGL would create economies of scale and
promote operational efficiency that Commercial Travelers could not
achieve on its own.
The ratings will remain under review while Commercial Travelers
works towards a potential affiliation with NGL. Should this
affiliation, which includes a near-term contribution of $5 million
in surplus notes from NGL and a co-insurance agreement for a
portion of Commercial Travelers' business, not move forward on a
timely basis, a multiple level downgrade will likely occur. If a
definitive agreement to partner is signed between the two mutual
companies, A.M. Best will re-evaluate Commercial Travelers' under
review status.
COMMONWEALTH BIOTECH: Delays Form 10-K for 2011
-----------------------------------------------
During the year ended Dec. 31, 2011, Commonwealth Biotechnologies,
Inc., disposed of two material assets. The assets sold were a
foreign subsidiary and a building consisting of office and
laboratory space. These sales occurred during the second and
fourth quarters of 2011. In order to ensure that these
transactions are properly accounted for in accordance with GAAP
and to provide the time needed for the Company's auditors to
complete their audit for the year ended Dec. 31, 2011, the
Registrant needs an extension of the prescribed time period to
file its Annual Report on Form 10-K for the year ended Dec. 31,
2011. The Company will file its Annual Report on Form 10-K within
the time constraints provided by Rule 12b-25 promulgated under the
Securities Exchange Act of 1934, as amended.
About Commonwealth Biotechnologies
Based in Midlothian, Virginia, Commonwealth Biotechnologies, Inc.,
was a specialized life sciences outsourcing business that offered
cutting-edge expertise and a complete array of Peptide-based
discovery chemistry and biology products and services through its
wholly owned subsidiary Mimotopes Pty Limited.
Commonwealth Biotechnologies Inc. filed for Chapter 11 bankruptcy
protection (Bankr. E.D. Va. Case No. 11-30381) on Jan. 20, 2011.
Judge Kevin R. Huennekens presides over the case. Paula S. Beran,
Esq., at Tavenner & Beran, PLC, represents the Debtor. The Debtor
estimated both assets and debts of between $1 million and
$10 million.
On April 7, 2011, the Bankruptcy Court approved the private sale
of Mimotopes for a gross sales price of $850,000. The sale closed
on April 29, 2011. Mimotopes was deconsolidated during the second
quarter of 2011.
COMMUNITY SHORES: Incurs $2.4 Million Net Loss in 2011
------------------------------------------------------
Community Shores Bank Corporation filed with the U.S. Securities
and Exchange Commission its annual report on Form 10-K disclosing
a net loss of $2.46 million on $10.83 million of total interest
and dividend income in 2011, compared with a net loss of $8.88
million on $11.98 million of total interest and dividend income in
2010.
The Company's balance sheet at Dec. 31, 2011, showed
$208.65 million in total assets, $210.07 million in total
liabilities, and a $1.42 million total shareholders' deficit.
Crowe Horwath LLP, in Grand Rapids, Michigan, expressed
substantial doubt about the Company's ability to continue as a
going concern. The independent auditors noted that the Company
has incurred significant recurring operating losses, is in default
of its notes payable collateralized by the stock of its wholly-
owned bank subsidiary, and the subsidiary bank is undercapitalized
and is not in compliance with revised minimum regulatory capital
requirements under a formal regulatory agreement which has imposed
limitations on certain operations.
A copy of the Form 10-K is available for free at:
http://is.gd/3dJ7xh
About Community Shores
Muskegon, Mich.-based Community Shores Bank Corporation, organized
in 1998, is a Michigan corporation and a bank holding company.
The Company owns all of the common stock of Community Shores Bank.
The Bank was organized and commenced operations in January 1999 as
a Michigan chartered bank with depository accounts insured by the
FDIC to the extent permitted by law. The Bank provides a full
range of commercial and consumer banking services primarily in the
communities of Muskegon County and Northern Ottawa County.
CONDOR DEVELOPMENT: Comfort Inn Washington Owner Files Chapter 11
-----------------------------------------------------------------
Condor Development LLC, also known has Ciara Inn, filed a Chapter
11 petition (Bankr. W.D. Wash. Case No. 12-13287) on March 30,
2012, in Seattle.
According to a court filing, the Debtor operates the Comfort Inn
Suites, a hotel located at Seatac, Washington. All general
operations, staffing, payroll, bills, utilities, etc., are paid
through a sister company, Seattle Group Limited.
According to the schedules, the hotel building and parking lot are
valued at $13 million and secures a $9.04 million claim by East
West Bank.
Seattle Group also filed for Chapter 11 protection (Bankr. Case
No. 12-13263) on March 30, 2012. Condor seeks an order approving
consolidation for administrative purposes of the two cases.
Hearings are scheduled April 27, 20120 and May 4, 2012.
CREDITRON FINANCIAL: Joyce Covatto Leaves Agility Marketing Group
-----------------------------------------------------------------
Ed Palatella at Erie Times-News reports that Guy Fustine, counsel
of Joyce Covatto, has confirmed her departure from Agility
Marketing Group at a hearing in U.S. Bankruptcy Court in Erie,
Pennsylvania.
According to the report, Ms. Covatto is no longer associated with
Telatron Marketing Group Inc.'s successor, Agility Marketing
Group, where she had been a senior manager. Agility, whose owner,
Y&Y Holdings LLC, is based in New York City, had kept Ms. Covatto
on staff after Y&Y purchased the bankrupt Telatron for $600,000 in
January. Both Agility and Telatron are telemarketers.
The report relates Mr. Fustine said he could not say whether Ms.
Covatto left Agility on her own. Mr. Fustine noted that in
February he submitted a plan in which the Ms. Covatto agreed to
use her salary to help pay the creditors in their bankruptcy case,
in which they owed $851,305 in taxes when she filed for
bankruptcy. "As a result of her no longer being employed by
Agility, it will be necessary to amend the plan," the report
quotes Mr. Fustine as saying.
The report notes Mr. Fustine said he is to present an update to
Chief U.S. Bankruptcy Judge Thomas P. Agresti by April 5, 2012.
Based in Erie, Pennsylvania, Creditron Financial Corporation dba
Telatron Marketing Group Inc. filed for Chapter 11 bankruptcy
protection (Bankr. W.D. Penn. Case No. 08-11289) on July 3, 2008.
Stephen H. Hutzelman, Esq., at Plate Shapira Hutzelman Berlin May,
et al., represents the Debtor. The Debtor disclosed $3 million in
total assets, and $4.8 million in total liabilities in its
bankruptcy petition.
A private business from New York City, Y & Y Holdings LLC, bought
Telatron's assets for $600,000 and renamed it Agility Marketing
Inc.
CRYOPORT INC: Names Stephen Wasserman to Board of Directors
-----------------------------------------------------------
CryoPort, Inc., has named Stephen E. Wasserman, 65, to its Board
of Directors. Mr. Wasserman has more than 30 years of senior
operating and financial management experience in the medical
device and healthcare industries. He replaces Carlton M. Johnson,
who resigned from the Board early March.
"Stephen's experience managing highly successful medical device
and diagnostic companies will be extremely valuable to CryoPort as
we accelerate our commercial activities this year," said Larry
Stambaugh, CryoPort's chairman and chief executive officer. "We
look forward to drawing on Stephen's in-depth knowledge of our
target markets and his proven ability to drive the introduction of
new technologies and products."
Mr. Wasserman is currently on the Board of the medical diagnostics
firm Iris International, and serves as chairman of the
compensation committee. Previously he served as group vice
president of the Diagnostic Systems Products division of Olympus
America, a leading medical technology company, as well as a member
of the executive committee for American Operations. Earlier in
his career he was chief financial officer and treasurer of
Datascope Corporation, where he was also president of its Patient
Monitoring Division, general manager for Melville Biologics, and
vice president and general manager of Technicon (now part of
Siemens Healthcare Diagnostics).
Mr. Wasserman received his Bachelors in Business Administration
from City College of New York, and is a Certified Public
Accountant.
Mr. Wasserman will receive a quarterly cash board fee in the
amount of $15,000.
About CryoPort Inc.
Headquartered in Lake Forest, Calif., CryoPort, Inc. (OTC BB:
CYRXD) -- http://www.cryoport.com/-- provides innovative cold
chain frozen shipping system dedicated to providing superior,
affordable cryogenic shipping solutions that ensure the safety,
status and temperature of high value, temperature sensitive
materials. The Company has developed a line of cost-effective
reusable cryogenic transport containers capable of transporting
biological, environmental and other temperature sensitive
materials at temperatures below 0-degree Celsius.
KMJ Corbin & Company LLP expressed substantial doubt about
CryoPort's ability to continue as a going concern, following
the Company's fiscal 2009 results. The firm noted that the
Company has incurred recurring losses and negative cash flows from
operations since inception.
The Company reported a net loss of $6.16 million on $378,700 of
net revenues for the nine months ended Dec. 31, 2011, compared
with a net loss of $4.29 million on $375,400 of net revenues for
the same period during the prior year.
The Company's balance sheet at Dec. 31, 2011, showed $4.22 million
in total assets, $3.60 million in total liabilities and
$620,873 in total stockholders' equity.
CST INDUSTRIES: S&P Affirms 'CCC' Corp. Credit Rating; Off Watch
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on Lenexa,
Kan.-based CST Industries Inc., including the 'CCC' corporate
credit rating. "At the same time, we removed the ratings from
CreditWatch, where we had placed them with negative implications
on Jan. 13. The outlook is negative," S&P said.
CST has amended its first-lien credit facility, and Standard &
Poor's believes the company should be in compliance with the
relaxed financial covenants this year. However, CST faces a large-
-approximately $32 million--loan amortization payment that could
be difficult to make at the end of this year.
"In our view, the risk for a default or selective default will
persist until the company refinances its credit facility and its
senior subordinated notes," said Standard & Poor's credit analyst
Dan Picciotto. "Because financial leverage remains elevated and we
expect only modest improvement this year, we consider refinancing
risks for the company's debt obligations to be high."
"Improved order rates should translate into modest improvement in
operating performance in 2012 for CST. Still, credit measures
likely will remain consistent with its highly leveraged financial
risk profile. CST designs, fabricates, and erects factory-coated
bolted and welded tanks and aluminum geodesic domes for a variety
of end markets, including water, wastewater, industrial,
agricultural, and oilfield," S&P said.
CYCLONE POWER: Delays Form 10-K for 2011
----------------------------------------
Cyclone Power Technologies, Inc., was unable to file its annual
report on Form 10-K for its fiscal year ended Dec. 31, 2011, by
the prescribed date without unreasonable effort or expense because
the Company's financial audit is in process and has not been
completed. The Company believes that the annual report will be
completed within the fifteen day extension period provided under
Rule 12b-25 of the Securities Exchange Act of 1934.
About Cyclone Power
Pompano Beach, Fla.-based Cyclone Power Technologies, Inc. (Pink
Sheets: CYPW) is a clean-tech engineering company, whose business
is to develop, commercialize and license its patented Rankine
cycle engine technology for applications ranging from renewable
power generation to transportation. The Company is the successor
entity to the business of Cyclone Technologies LLLP, a limited
liability limited partnership formed in Florida in June 2004.
Cyclone Technologies LLLP was the original developer and
intellectual property holder of the Cyclone engine technology.
The Company reported a net loss of $23.2 million on $250,000 of
revenues for the nine months ended Sept. 30, 2011, compared with
net income of $447,016 on $202,375 of revenues for the same period
last year.
The Company's balance sheet at Sept. 30, 2011, showed $1.2 million
in total assets, $3.8 million in total liabilities, and a
stockholders' deficit of $2.6 million.
The Company incurred substantial operating losses for the nine
months ended Sept. 30, 2011, of $2.7 million. The cumulative
deficit since inception is approximately $45.2 million, which is
comprised of $13.8 million attributable to operating losses, and
$31.4 million in non-cash derivative liability accounting. The
Company has a working capital deficit at Sept. 30, 2011, of
approximately $2.3 million.
"There is no guarantee whether the Company will be able to
generate enough revenue and/or raise capital to support its
operations," the Company said in the filing. "This raises
substantial doubt about the Company's ability to continue as a
going concern."
D.R. HORTON: Moody's Upgrades CFR to 'Ba2'; Outlook Stable
----------------------------------------------------------
Moody's Investors Service upgraded D.R. Horton, Inc.'s corporate
family and probability of default ratings to Ba2 from Ba3 and the
ratings on the company's existing senior unsecured notes and
convertible senior notes to Ba2 from Ba3. The speculative grade
liquidity assessment is SGL-2, and the rating outlook is stable.
The following rating actions were taken:
Corporate family rating upgraded to Ba2 from Ba3;
Probability of default rating upgraded to Ba2 from Ba3;
Existing senior unsecured notes upgraded to Ba2 (LGD4, 54%) from
Ba3 (LGD4, 54%);
Existing convertible senior notes upgraded to Ba2 (LGD4, 54%) from
Ba3 (LGD4, 54%);
The rating outlook is stable.
The rating actions reflect Moody's expectation that Horton will be
able to translate the slowly improving trends in the homebuilding
industry into stronger credit metrics, including expanding gross
margins and return on assets, growing positive net income, and
increasing net worth, while maintaining relatively conservative
homebuilding debt leverage. Despite the industry headwinds, the
company generated positive net income during seven of the last
nine quarters while reducing its adjusted debt leverage to 39%
from 58%. Horton's solid liquidity profile, supported by one of
the strongest cash and equivalents positions in the industry
(aggregating over $1 billion at December 31, 2011), gives it
significant financial flexibility to pursue growth and address
debt maturities over the next several years.
Rating Rationale
The Ba2 rating reflects the company's cash generating prowess,
which has permitted it to repay over $4 billion of homebuilding
debt out of internally generated funds since the downturn began.
The rating also incorporates Horton's conservative capital
structure as reflected in one of the lowest homebuilding debt
leverage ratios in the industry, its relatively clean and
transparent balance sheet, and strong earnings metrics, including
healthy gross margins and positive net income generation. In
addition, the Ba2 rating considers Horton's solid liquidity,
supported by over $1 billion of cash and cash equivalents. The
rating also reflects the company's size and scale as one of the
largest and most geographically diversified homebuilders in the
U.S.
Horton's rating also recognizes that while the industry is
demonstrating some positive trends, conditions still remain weak
compared to historical norms, and a meaningful recovery is
unlikely over the next couple of years. This will constrain the
degree of improvement Horton and the other homebuilders will be
able to realize in the intermediate term. Moody's expects Horton
to generate negative cash flow from operations in FY 2012 as it
replenishes and adds to its land position. The company's large
speculative build percentage of over 50% and long land supply of
about six years leave it exposed in the event of a sharp or sudden
downturn.
Horton's good liquidity profile is reflected in its SGL-2
speculative-grade liquidity assessment, which balances the
company's strong cash position and absence of financial covenants
with the expectation for negative cash flow generation, lack of an
external liquidity facility, and somewhat limited opportunities to
monetize excess assets quickly.
The stable outlook reflects Moody's expectation that the company
will improve its operating metrics in FY 2012, while maintaining
solid liquidity, a strong cash and investments position, and
therefore considerable financial flexibility.
The ratings or outlook could improve if the industry were to move
to sustainable profitability, which would be presaged by material
improvement in unemployment, consumer confidence, and a reduction
in excess inventories. Additionally, if the company continues to
expand its net income generation and maintains its homebuilding
debt leverage at or below 40% while sustaining solid liquidity,
the ratings or outlook could be revised up.
The outlook could be changed to negative if the industry entered
into a double dip downturn. The ratings could be lowered if
impairment charges were again to reach high levels, cash flow
generation were to turn sharply negative without an offsetting
increase in earnings, and/or the company were to increase its
adjusted gross homebuilding debt leverage above 50%.
The principal methodology used in rating D.R. Horton, Inc. was the
Global Homebuilding Industry Methodology published in March 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.
D.R. Horton, Inc., headquartered in Fort Worth, Texas, is one of
the largest and most geographically diversified homebuilders in
the United States. The company has a presence in 25 states and 73
regions and generates approximately 98% of its revenues from
homebuilding operations, focusing on the construction and sale of
single-family detached homes. In the last twelve months ended
December 31, 2011, the company generated homebuilding revenues of
$3.7 billion.
DAIS ANALYTIC: Incurs $2.3 Million Net Loss in 2011
---------------------------------------------------
Dais Analytic Corporation filed with the U.S. Securities and
Exchange Commission its Annual Report on Form 10-K disclosing a
net loss of $2.33 million on $3.50 million of revenue in 2011,
compared with a net loss of $1.43 million on $3.34 million of
revenue in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $1.86 million
in total assets, $6.76 million in total liabilities, and a
$4.90 million total stockholders' deficit.
For 2011, Cross, Fernandez & Riley LLP, in Orlando, Florida,
expressed substantial doubt about the Company's ability to
continue as a going concern. The independent auditors noted that
the Company has incurred significant losses since inception and
has a working capital deficit and stockholders' deficit of
$3,222,163 and $4,900,910 at Dec. 31, 2011.
A copy of the Form 10-K is available for free at:
http://is.gd/vX9DiN
About Dais Analytic
Odessa, Fla.-based Dais Analytic Corporation has developed and
patented a nano-structure polymer technology, which is being
commercialized in products based on the functionality of these
materials. The initial product focus of the Company is ConsERV,
an energy recovery ventilator. The Company also has new product
applications in various developmental stages.
DIGITILITI INC: Delays Form 10-K for 2011
-----------------------------------------
Digitiliti, Inc., notified 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 in
the process of completing its unaudited financial statements, and
believes that the subject Quarterly Report will be available for
filing on or before April 16, 2012.
About Digitiliti, Inc.
St. Paul, Minnesota-based Digitiliti, Inc.'s business is
developing and delivering storage technologies and methodologies
enabling its customers to manage, control, protect and access
their information and data with ease. The Company's core business
is providing a cost effective on-line data protection solution to
the small to medium business ("SMB") and small to medium
enterprise ("SME") markets through its DigiBAK service. This on-
line data protection solution helps organizations properly manage
and protect their entire network from one centralized location.
The Company reported a net loss of $6.41 million on $2.14 million
of revenue for the year ended Dec. 31, 2010, compared with a net
loss of $5.17 million on $3.19 million of revenue during the prior
year.
The Company also reported a net loss of $2.29 million on
$1.39 million of revenue for the nine months ended Sept. 30, 2011,
compared with a net loss of $5.26 million on $1.71 million of
revenue for the same period a year ago.
The Company's balance sheet at Sept. 30, 2011, showed
$1.49 million in total assets, $3.64 million in total liabilities,
and a $2.15 million total stockholders' deficit.
As reported by the TCR on April 18, 2011, MaloneBailey, LLP, 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 losses from operations and has a working
capital deficit.
DARLING INT'L: S&P Raises Corporate Credit Rating to 'BB+'
----------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Irving, Texas-based food and animal byproducts renderer
Darling International Inc. to 'BB+' from 'BB'. The outlook is
stable.
"At the same time, we raised our issue-level ratings on the
company's $250 million senior unsecured notes maturing 2018 to
'BB+' from 'BB', with an unchanged recovery rating of '3'
indicating our expectations for meaningful recovery (50%-70%) in
the event of a payment default. While the estimated recovery value
for the unsecured notes is in the 90%-100% range, we cap the
recovery rating at '3', according to our criteria on unsecured
debt of issuers in the 'BB' category," S&P said.
"We also withdrew our issue-level and recovery ratings on the
company's $300 million senior secured term loan B after the
remaining $30 million outstanding balance on this debt was repaid
in January 2012," S&P said.
"We estimate that Darling has about $250 million in balance sheet
debt remaining outstanding," S&P said.
"The upgrade reflects Darling's continued improvement in credit
measures after repaying about $430 million in debt during fiscal
2011 with free cash flow and about $293 million in net equity
proceeds from a secondary offering completed in January 2011,"
said Standard & Poor's credit analyst Chris Johnson. "Our stable
ratings outlook reflects our opinion that the company will
maintain its improved credit measures, including debt to EBITDA of
close to 1x and FFO to debt of over 60%, despite the possibility
of modestly weaker operating performance in 2012."
"The ratings on Darling reflect its 'intermediate' financial risk
profile and 'weak' business risk profile. Darling's intermediate
financial risk profile primarily reflects the company's
conservative financial policies (supported by last year's equity
issuance and debt repayments). We believe that Darling will
maintain a debt to EBITDA ratio near 1x and funds from operations
(FFO) to total debt of more than 60% over the next year, compared
with respective ratios of 0.9x and 87.4% for the fiscal year ended
Dec. 31, 2011. Although these credit measure are better than the
respective indicative ratio ranges of 2x-3x and 30%-45% for an
intermediate financial risk profile, our financial risk assessment
also reflects uncertainty over future financial policies as they
relate to the use of free cash flow (projected to be greater than
$150 million next year) and any future contingent liabilities
and/or funding requirements for the company's Diamond Green Diesel
Holding bio-fuel joint venture (JV) with Valero Energy Corp.
(BBB/Stable/--). (We do not currently make any debt adjustments
for the JV's debt and believe outstanding debt at the JV is
nominal and nonrecourse to Darling. However, we will continue to
monitor the amount of outstanding debt as the project progresses
and evaluate the strategic importance of the JV to Darling to
determine whether any future debt adjustment needs to be made to
Darling's reported debt balances)," S&P said.
"We would consider lowering the rating if the negative operating
trends that affected the company in fiscal 2009 return, including
adjusted EBITDA margins falling to about 16% and adjusted debt to
EBITDA increasing to closer to 3x. In our opinion, this could
occur if rendering volumes fall by more than 5% and current prices
for rendering products declined by more than 20% (reverting back
to 2010 average levels or lower), while energy costs continue to
escalate. A higher rating is unlikely over the next year and would
require an improved business risk profile, either by adding more
scale or by further diversifying its product offerings," S&P said.
DECATUR RETAIL: Case Summary & 8 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Decatur Retail Partners, LLC
1111 Mary Crest Rd., Suite E
Henderson, NV 89074
Bankruptcy Case No.: 12-13579
Chapter 11 Petition Date: March 28, 2012
Court: United States Bankruptcy Court
District of Nevada (Las Vegas)
Judge: Mike K. Nakagawa
Debtor's Counsel: Timothy S. Cory, Esq.
DURHAM JONES & PINEGAR
10785 W Twain, Suite 200
Las Vegas, NV 89135
Tel: (702) 870-6060
Fax: (702) 870-6090
E-mail: tcory@djplaw.com
Estimated Assets: $100,001 to $500,000
Estimated Debts: $500,001 to $1,000,000
A list of the Company's eight largest unsecured creditors filed
together with the petition is available for free at
http://bankrupt.com/misc/nvb12-13579.pdf
The petition was signed by Christian D. Haase, manager.
DELOS AIRCRAFT: Fitch to Rate Proposed $550-Mil. Loan at 'BB'
-------------------------------------------------------------
Fitch Ratings expects to assign a 'BB' rating to the proposed $550
million secured term loan facility to be issued by Delos Aircraft,
Inc. (Delos). Delos is a wholly owned, indirect subsidiary of
International Lease Finance Corp. (ILFC).
The proceeds of the new term loan will be used to refinance an
existing $550 million term loan issued by Delos in 2010. The
general structure and terms (including the maturity date) of the
new term loan are expected to be similar to the existing facility,
which carries a 'BB' rating. The proposed facility is expected to
carry a lower coupon rate than the existing term loan, which
currently has an effective interest rate of 7% (LIBOR + 5.0% with
a 2.0% LIBOR floor).
ILFC is a market leader in the leasing and remarketing of
commercial jet aircraft to airlines around the world. As of Dec.
31, 2011, ILFC owned an aircraft portfolio with a net book value
of approximately $36 billion, consisting of 930 jet aircraft.
Fitch expects to assign the following rating:
Delos Aircraft, Inc.
-- Proposed $550 million senior secured term loan 'BB'.
Fitch currently rates ILFC and its related subsidiaries as
follows:
International Lease Finance Corp.
-- Long-term IDR 'BB'; Outlook Stable;
-- $3.9 billion senior secured notes 'BBB-';
-- Senior unsecured debt 'BB';
-- Preferred stock 'B'.
Delos Aircraft Inc.
-- $550 million senior secured term loan 'BB'.
Flying Fortress Inc.
-- $900 million senior secured term loan 'BB'.
ILFC E-Capital Trust I
-- Preferred stock 'B'.
ILFC E-Capital Trust II
-- Preferred stock 'B'.
DELTA PETROLEUM: Plan Proposal Exclusivity Extended June 12
-----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware extended
Delta Petroleum Corporation, et al.'s exclusive periods to file
and solicit acceptances for the proposed Chapter 11 Plan until
June 12, 2012, and Aug. 12, respectively.
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' 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.
Delta will hold an auction for the business on March 26, 2012. No
buyer is under contract. There is $57.5 million in financing for
the Chapter 11 effort.
The U.S. Trustee told the bankruptcy judge that there was
insufficient interest from creditors to form an official committee
of unsecured creditors.
DELTA PETROLEUM: DIP Loan Amended to Extend Sale Deadlines
----------------------------------------------------------
Delta Petroleum Corporation, et al., ask the U.S. Bankruptcy Court
for the District of Delaware to authorize the amendment to their
existing DIP Credit Agreement with Whitebox Advisors, LLC, as
administrative agent and collateral agent, and pay certain
extension fees in connection therewith.
The Debtors relate that they also requested that certain of the
sale process deadlines, including the bid deadline and the
procedures for and date of the auction, be amended to allow
potential bidders additional time.
The Court entered an order approving the amended bid procedures on
March 22, 2012. The amended bid procedures order set the bid
deadline for April 18, 2012, at 4:00 p.m. (ET), the deadline to
notify potential bidders whether an auction would occur for April
20, the auction for April 24, at 9:00 a.m. (ET) and the sale
hearing for May 1, at 11:00 a.m.
The Debtors and the DIP Lenders reached an agreement to amend the
DIP Credit Agreement, substantially on the terms and conditions
set forth in the Second Amendment, to avoid the occurrence of an
Event of Default due to the breach of the March 31, 2012,
milestone that would be caused by the amended bid procedures.
Subject to the satisfaction of certain conditions precedent and
covenants, the DIP Amendment generally provides for these
modifications to the DIP Credit Agreement:
The parties agree to extend the sale milestones under the DIP
Credit Agreement to April 30, 2012 (the deadline to have a letter
of intent with respect to a sale of the assets) and May 30, 2012
(the execution of an asset purchase agreement). In addition,
availability under the DIP Credit Facility will be increased by
$1.4 million to $58.9 million. The Debtors agree to pay the
lenders an extension fee equal to $287,500.
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.
Delta will hold an auction for the business on March 26, 2012. No
buyer is under contract. There is $57.5 million in financing for
the Chapter 11 effort.
The U.S. Trustee told the bankruptcy judge that there was
insufficient interest from creditors to form an official committee
of unsecured creditors.
DESERT EQUIPMENT: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Desert Equipment, Inc.
8201 E 23rd Street
Kansas City, MO 64129
Bankruptcy Case No.: 12-17663
Chapter 11 Petition Date: March 28, 2012
Court: United States Bankruptcy Court
Central District of California (Riverside)
Debtor's Counsel: John F. Fitzmaurice, Esq.
FITZMAURICE & DEMERGIAN
1061 Tierra del Rey, Suite 204
Chula Vista, CA 91910
Tel: (619) 591-1000
Fax: (619) 591-1010
E-mail: almaraz@law.zzn.com
- and -
Wolfgang F. Hahn, Esq.
WOLFGANG F. HAHN + ASSOCIATES
7160 Caminito Pepino
La Jolla, CA 92037
Tel: (858) 535-1000
Fax: (858) 456-5080
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the list of 20 largest unsecured creditors is available
for free at http://bankrupt.com/misc/cacb12-17663.pdf
The petition was signed by Wayne Reeder, president/CEO
DEX ONE: Moody's Cuts CFR to 'Caa3', Revises PDR to 'Ca/LD'
-----------------------------------------------------------
Moody's Investors Service has downgraded the corporate family
rating (CFR) for Dex One Corporation's to Caa3 from B3 based on
Moody's view that a debt restructuring is inevitable. Moody's
expects ultimate recoveries will be about 50%. Moody's has also
changed Dex's Probability of Default Rating (PDR) to Ca/LD from B3
following the company's purchase of about $142 million of par
value bank debt for about $70 million in cash. The revision of the
PDR to Ca/LD reflects Moody's view that the transaction
constitutes a distressed exchange. In three days, Moody's will
remove the LD designation and change the PDR to Caa3. Moody's
ratings outlook for Dex One remains negative.
The Caa3 rating also reflects Moody's view that additional
exchanges at a discount are likely in the future since the company
amended its bank covenants to make it possible to repurchase
additional bank debt on the open market through the end of 2013.
The company announced they are targeting the retirement of at
least $500 million of total debt this year.
In addition, the company has also launched a tender offer for a
portion of its $300 million aggregate principal amount of 12% /
14% Senior Subordinated Notes due 2017 at a purchase price of $270
to $300 per $1,000 principal amount of such Notes. This offer will
remains open until April 19 and is likely to be considered a
distressed exchange once completed.
Ratings Rationale
Dex One is attempting to reinvent its business by reducing its
reliance on print advertising through the development of online
and mobile directory service applications but Moody's has doubts
that the company will be able to transition its business away from
a reliance on print directories quickly enough to stabilize its
revenues and earnings and prevent a debt restructuring. While
year-over-year digital bookings increased 34% in 4Q'11, total ad
sales were down 13% in 4Q'11 and declined 14% for the full year.
Moody's anticipates another double-digit percentage decline in
total ad sales for all directory publishers this year and next
year. Furthermore, Moody's believes that the initiative to
transition the business will require investment that will offset
the company's efforts to sustain margins by lowering the cost
structure of its legacy print business. Consequently, Moody's
expects that the relatively robust levels of free cash flow that
the company is currently generating will decline at an
accelerating pace over time.
Dex One has good liquidity based on Moody's projection of almost
$200 million in cash at year end 2012 (after all announced debt
repuchases and mandatory amortizations and sweep payments) and
continued positive free cash flow. Similar to its competitors, the
company requires minimal capital investment, well below internally
generated cash flows.
Rating Outlook
The negative outlook reflects Moody's view that demand for the
company's core yellow pages advertising products is in secular
decline and that Dex One's capital structure is unsustainable. It
is increasingly likely that the company will need to restructure
its debt obligations in the future.
What Could Change the Rating - Down
Moody's would downgrade the CFR rating if revenue or EBITDA were
to decline below Moody's expectations, and Moody's would downgrade
the PDR if the company were to default or exchange debt securities
at sub-par values or enter into a distressed exchange.
What Could Change the Rating -- Up
A rating upgrade is deemed unlikely in the absence of a large
equity raise that reduces debt levels to a more sustainable level.
Dex One's ratings were assigned by evaluating factors that Moody's
considers relevant to the credit profile of the issuer, such as
the company's (i) business risk and competitive position compared
with others within the industry; (ii) capital structure and
financial risk; (iii) projected performance over the near to
intermediate term; and (iv) management's track record and
tolerance for risk. Moody's compared these attributes against
other issuers both within and outside Dex One's core industry and
believes Dex One's ratings are comparable to those of other
issuers with similar credit risk.
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 $1.5 billion for the LTM period ended December 31,
2011.
Moody's has taken the following rating actions:
Issuer: Dex One Corporation
Downgrades:
Probability of Default Rating, Downgraded to Ca/LD from B3
Corporate Family Rating, Downgraded to Caa3 from B3
US$300M 12% Senior Subordinated Regular Bond/Debenture due
2017, Downgraded to Ca from Caa2
Upgrades:
US$300M 12% Senior Subordinated Regular Bond/Debenture due
2017, Upgraded to a range of LGD6, 93 % from a range of
LGD6, 94 %
Issuer: Dex Media East, Inc.
Downgrades:
Senior Secured Bank Credit Facility due Oct 2014, Downgraded
to Caa3 from B2
Upgrades:
Senior Secured Bank Credit Facility due Oct 2014, Upgraded
to a range of LGD3, 41 % from a range of LGD3, 42 %
Issuer: Dex Media West, Inc.
Downgrades:
Senior Secured Bank Credit Facility due Oct 2014, Downgraded
to Caa3 from B2
Upgrades:
Senior Secured Bank Credit Facility due Oct 2014, Upgraded
to a range of LGD3, 41 % from a range of LGD3, 42 %
Issuer: R.H. Donnelley, Inc.
Downgrades:
Senior Secured Bank Credit Facility due Oct 2014, Downgraded
to Caa3 from B2
Upgrades:
Senior Secured Bank Credit Facility due Oct 2014, Upgraded
to a range of LGD3, 41 % from a range of LGD3, 42 %
DILLARD'S INC: Fitch Upgrades Issuer Default Rating to 'BB+'
------------------------------------------------------------
Fitch Ratings has upgraded its long-term Issuer Default Rating
(IDR) on Dillard's, Inc. to 'BB+' from 'BB' and also upgraded the
issue ratings by one notch. The Rating Outlook is Stable.
The upgrades reflect better than expected improvement in Dillard's
comparable store sales (comps), EBITDA and credit metrics over the
last two years. Comps have been positive and above industry
average for the last two years, after years of underperforming its
large industry peers, and Dillard's has made strong progress in
improving profitability both on gross margin and expense control.
The company's 2011 EBITDA margin of 10.6% is the highest level
generated in over a decade. Looking at the core retail business
(excluding CDI Contractors, Dillard's general contracting
construction operations, and other income), 2011 EBITDA of
approximately $545 million and EBITDA margin of 8.8% is
significantly higher than 2005/2006 levels of $460 million and
EBITDA margin of 6%, on a revenue base that is approximately 20%
lower versus five years ago.
Fitch expects Dillard's to sustain comp store sales growth in the
low single-digits range over the next 24 to 36 months and see
modest improvement in EBITDA.
At the end of 2011, adjusted debt/EBITDAR ratio stood at 1.6 times
(x) while the fixed charge coverage came in at 6.1x. Fitch
expects Dillard's leverage to remain within 2.0x (could be
slightly higher at seasonal working capital peaks) over the
intermediate term. Dillard's may choose to use borrowings under
its credit facility or other sources of financing to augment its
share buyback program. While Dillard's credit metrics are strong
for the rating category, the ratings continue to incorporate
Dillard's below industry-average sales productivity (as measured
by sales per square foot) and operating profitability relative to
its investment grade peers.
Risks to the ratings are a return to negative comparable store
sales trends and/or debt financed share buybacks that take
leverage over the 2.5x range.
Dillard's is the sixth largest department store chain in the U.S.
in terms of sales, with 2011 revenue of $6.2 billion on 288 stores
and 16 clearance centers in 29 states in the southeast, central
and southwestern U.S. Dillard's comps have continued their
positive trajectory, up 4% in 2011, following a +3% comp in 2010
after 10 years of negative trends. The improvement has been
driven by improved merchandise assortment, store execution,
inventory control, and improved service.
Dillard's has attempted to move more upscale to differentiate
itself from the moderate, traditional department stores by
procuring products found in specialty boutiques and up-market
retailers such as Nordstrom. While its more recent focus on
reinvigorating its brands and cutting through excess inventory
have yielded positive top-line results, Dillard's annual sales per
square foot at $118 is significantly lower than other well-
operated mid-tier department store peers which are in the $175-
$230 range. This should provide further opportunity for
improvement. The company has also taken a more aggressive stance
toward closing underperforming stores, closing a net 22 units or
over 6% of its square footage since the end of 2007.
From a store investment perspective, Dillard's pulled back capital
expenditures to $75 million in 2009 and roughly $100 million-$120
million in 2010/11 versus the $300 million-plus range in 2006-
2007. While the $300 million-plus level reflected new store
openings and Dillard's is ramping up capital spending to $175
million in 2012, the company may need to step up its capital
spending further to keep pace with the industry longer term. At
the present time, however, the company's real estate portfolio is
in relatively adequate shape and the real challenge is executing
on its merchandising strategy, in Fitch's view.
Liquidity remains strong, supported by a cash balance of $224
million as of Jan. 28, 2012 and $753 million available under its
$1 billion credit facility. Fitch expects Dillard's to generate
strong free cash flow (FCF) of approximately $250 million annually
through 2012-2014, compared with the $400 million range for each
of the past three years.
Dillard's has dedicated the bulk of its FCF to debt reduction,
paying down $2.5 billion in debt over the past 10 years to a level
where consolidated book debt is around $900 million. Fitch
expects Dillard's to pay down $77 million in 2012 maturities;
after this, the company's next debt maturity of $248 million is in
2018.
Given modest debt maturities, Fitch expects Dillard's to direct
excess cash flow toward share buybacks. In addition, if the level
of share buybacks is similar to the $500 million executed in 2011,
Fitch expects the activity to be supported by borrowings under its
credit facility which could lead to increased leverage from the
current 1.6x.
The $1 billion senior credit facility, which is due to mature on
Dec. 12, 2012, is rated one notch above the IDR at 'BBB-' as the
facility is secured by 100% of the inventories at Dillard's
unrestricted operating subsidiaries. Fitch expects Dillard's to
amend and extend this facility in its first quarter with a five-
year term and substantially similar terms and structure.
Dillard's, Inc. and its operating subsidiaries are the borrowers
under the revolver. Availability for borrowings and letter of
credit obligations under the current credit agreement is limited
to 85% of the inventory of certain company unrestricted operating
subsidiaries. Dillard's typically has full access to its facility
at peak inventory season. There are no financial covenants in the
facility as long as availability exceeds $100 million. When
availability falls below this threshold, fixed charge coverage
must be at least 1.0x.
The $670 million of senior unsecured notes are rated at par with
the IDR while the $200 million in capital securities due 2038 are
rated two notches below the IDR reflecting their structural
subordination.
Fitch has upgraded the company's IDR and issue ratings as follows:
-- Long-term IDR to 'BB+' from 'BB';
-- $1 billion secured credit facility to 'BBB-' from 'BB+' ;
-- Senior unsecured notes to 'BB+' from 'BB';
-- Capital securities upgraded to 'BB-' from 'B+'.
The Rating Outlook is Stable.
DIRECTBUY HOLDINGS: S&P Withdraws 'D' Corporate Credit Rating
-------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its ratings, including
its 'D' corporate cedit rating, on Merrillville, Ind.-based
DirectBuy Holdings Inc. "The company missed the interest payment
due Feb. 1, 2011, on its $335 million senior unsecured notes and
it is our understanding that it remains in default on the payment.
In our opinion, the company is no longer providing timely and
sufficient information for us to maintain a credit rating," S&P
said.
DOLPHIN DIGITAL: Incurs $1.2 Million Net Loss in 2011
-----------------------------------------------------
Dolphin Digital Media, Inc., filed with the U.S. Securities and
Exchange Commission its annual report on Form 10-K, disclosing a
net loss of $1.23 million on $472,824 of revenue in 2011, compared
with a net loss of $5.63 million on $0 of revenue in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $1.61 million
in total assets, $5.95 million in total liabilities, all current,
and a $4.34 million total stockholders' deficit.
For 2011, RBSM LLP, in New York, noted that the Company has
incurred significant losses and has capital and working capital
deficiencies, which raises substantial doubt about its ability to
continue as a going concern.
A copy of the Form 10-K is available for free at:
http://is.gd/owEB6Q
About Dolphin Digital
Coral Gables, Florida-based Dolphin Digital Media, Inc., is
dedicated to the twin causes of online safety for children and
high quality digital entertainment. By creating and managing
child-friendly social networking websites utilizing state-of the-
art fingerprint identification technology, Dolphin Digital Media,
Inc. has taken an industry-leading position with respect to
internet safety, as well as digital entertainment.
DOMMER CONSTRUCTION: Rooker-Feldman Doctrine Doesn't Appy to BFG
----------------------------------------------------------------
Business Financial Group seeks reversal of the Order of the Hon.
Michael J. Kaplan, United States Bankruptcy Judge, Western
District of New York, which found that Dommer Construction Corp.
could offset certain debt it owed BFG. In rendering his judgment,
Judge Kaplan expressly disagreed with a previous New York State
court decision that came to a contrary conclusion. Specifically,
BFG appeals Judge Kaplan's finding that the Rooker-Feldman
doctrine did not apply, allowing him to come to a different
conclusion than the New York State court. In a March 26 decision
and order, Chief Judge William M. Skretny affirmed, saying the
Rooker-Feldman doctrine did not apply to the bankruptcy court's
adjudication of BFG's Proof of Claim and the bankruptcy court
properly exercised its subject-matter jurisdiction.
Dommer is a general contractor that became liable to BFG for loans
that BFG provided to Dommer's subcontractor, MBE Group Inc. BFG
eventually sued on this debt in New York State court. On March
29, 2010, the New York State Supreme Court, County of Erie, found
Dommer liable in the amount of $438,725. Bus. Funding Grp., Inc.
v. Dommer Constr. Corp., Index No. 2005-5161 (N.Y. Sup. Ct. Mar.
29, 2010) (unreported). On June 22, 2010, the state court denied
Dommer's motion for reconsideration and subsequently signed a
judgment in BFG's favor for the amount. But before that judgment
was entered at the Erie County Clerk's Office, Dommer sought
Chapter 11 relief automatically staying the entry of a final
judgment.
The case before the District Court is, Business Funding Group,
Appellant, v. Dommer Construction Corp., Appellee, No. 11-CV-565S
(W.D.N.Y.). A copy of the District Court's Decision and Order is
available at http://is.gd/N99kUHfrom Leagle.com.
Business Funding Group is represented by Ingrid S. Palermo, Esq.,
at Harter, Secrest & Emery LLP & Joseph Zagraniczny, Esq. --
jzagraniczny@bsk.com -- at Bond, Schoeneck & King, PLLC.
Dommer Construction Corporation is represented by Daniel F. Brown,
Esq. -- dfb@abfmwb.com -- at Andreozzi Bluestein Fickess Muhlbauer
Weber Brown LLP; and Eric A. Bloom, Esq. -- ebloom@damonmorey.com
-- at Damon Morey LLP.
Based in Lancaster, New York, Dommer Construction Corporation
filed for Chapter 11 bankruptcy (Bankr. W.D.N.Y. Case No.
10-12764) on June 23, 2010, represented by Beth Ann Bivona, Esq.
-- bbivona@damonmorey.com -- at Damon Morey LLP in Buffalo. In
its petition, it estimated under $50,000 in assets and $1 million
to $10 million in debts.
DUTCH GOLD: Delays Form 10-K for 2011
-------------------------------------
Dutch Gold Resources, Inc., was unable to compile the necessary
financial information required to prepare a complete filing of its
annual report on Form 10-K for the period ended Dec. 31, 2011.
Thus, the Company would be unable to file the periodic report in a
timely manner without unreasonable effort or expense. The Company
expects to file within the extension period.
About Dutch Gold
Based in Atlanta, Ga., Dutch Gold Resources, Inc. (OTC: DGRI)
-- http://www.dutchgoldresources.com/-- is a junior gold miner
focused on developing its existing mining properties in North
America and acquiring and developing new mines that can enter into
production in 12 to 24 months.
The Company's balance sheet at Sept. 30, 2011, showed $2.77
million in total assets, $7.30 million in total liabilities and a
$4.53 million total stockholders' deficit.
As reported, Hancock Askew & Co., LLP, in Atlanta, Georgia,
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 limited
liquidity and has incurred recurring losses from operations.
The Company reported a net loss of $3.70 million on $0 of revenue
for the year ended Dec. 31, 2010, compared with a net loss of
$11.33 million on $0 of revenue during the prior year. The
Company also reported a net loss of $4.38 million on $0 of
sales for the nine months ended Sept. 30, 2011.
DYNEGY INC: Disputes Examiner's Fraudulent Transfer Finding
-----------------------------------------------------------
Dynegy Inc. has expressed disappointment over the findings of the
Chapter 11 examiner that its prepetition acquisition of coal-
powered plant assets from Dynegy Holdings LLC's subsidiary was a
fraudulent transfer.
"Dynegy is both troubled and disappointed by the examiner's report
as we continue to believe our restructuring activities benefited
all stakeholders and were conducted in the proper manner," Chief
Executive Officer Robert Flexon said.
Susheel Kirpalani, the court-appointed examiner, released the
results of his investigation, which found that the sale of the
coal-powered plant assets was a fraudulent transfer that harmed
creditors.
The findings prompted the U.S. Trustee, an agency of the U.S.
Department of Justice overseeing bankruptcy cases, to file a
motion for the appointment of a trustee who would take over Dynegy
Holdings' bankruptcy case. A court hearing on a bankruptcy
trustee's appointment is set for April 4.
In a statement, Mr. Flexon disputed the Chapter 11 Examiner's
findings that the sale was a fraudulent transfer, saying documents
related to the transaction show that there was no intent to harm
creditors.
"The transaction was done in support of an exchange offer intended
to reduce [Dynegy Holdings'] debt for the benefit of Dynegy
Holdings creditors while offering a more secured investment for
those creditors who participated in the exchange," Mr. Flexon
said.
A full-text copy of the company's statement is available for free
at http://is.gd/ytQzld
In a court filing, Dynegy Inc.'s lawyer, J. Christopher Shore,
Esq., at White & Case LLP, in New York, said the Chapter 11
Examiner's conclusions are based on "inexplicable omission of
certain material facts."
Mr. Shore cited the report's failure to disclose the "successful
efforts" of its board's Finance & Restructuring Committee to avoid
a financial covenant default that would have forced the entire
company into bankruptcy and destroy substantial enterprise value.
The lawyer said the report did not also discuss the lawsuit filed
by PSEG Resources Inc. and its affiliates before the Delaware
Chancery Court to thwart the company's restructuring efforts, or
the Delaware Chancery Court's opinion, which considered and
rejected many of the arguments embraced by the examiner.
The report also failed to discuss the final step of the company's
pre-bankruptcy restructuring transactions, including an agreement
reached with the ad hoc committee of Dynegy Holdings' noteholders,
according to Mr. Shore.
Under that deal, Dynegy Inc. agreed to completely delever all
obligations of Dynegy Holdings and to support the repayment of
creditors with the full value of the entire enterprise by Dynegy
Inc. agreeing to issue $1 billion of new debt and $2.1 billion of
new preferred stock, and to pay those creditors $400 million of
cash.
"Whether these facts were intentionally or inadvertently omitted,
their omission results in the Report telling a story that differs
markedly from reality," Mr. Shore said.
Separately, Standard & Poor's said the current CC rating is not
affected by the Chapter 11 Examiner's report. With the rating
already at CC, there is not much left before "D," for default,
according to a report by Bloomberg News.
S&P said that its already "negative" outlook incorporates the risk
that the Dynegy parent and other non-bankrupt affiliates "may yet
be drawn into the Dynegy Holdings bankruptcy." It also said there
is a risk that "key asset transfers may be reversed," Bloomberg
News reported.
Classified Portions of Report Unsealed
The Official Committee of Unsecured Creditors in Dynegy Holdings
LLC's cases sought and obtained approval from the U.S. Bankruptcy
Court for the Southern District of New York to access a portion of
the report released by the examiner appointed to investigate
Dynegy Holdings LLC's bankruptcy.
In a court order, Dynegy Holdings was required to turn over
information about the sale of its coal-powered plant assets to its
parent, Dynegy Inc.
The company was also ordered to turn over information that was not
disclosed based upon claims of "attorney-client privilege" or
"attorney-work product protection." Such information will be
provided to the committee on a "professional's eyes only" basis.
Early this month, Susheel Kirpalani, the court-appointed Chapter
11 Examiner, released the results of his investigation, which
found that the sale of the coal-powered plant assets was a
fraudulent transfer. The findings prompted the U.S. Trustee to
file a motion for the appointment of a bankruptcy trustee who
would take over Dynegy Holdings' case.
About Dynegy Inc.
Through its subsidiaries, Houston, Texas-based Dynegy Inc.
(NYSE: DYN) -- http://www.dynegy.com/-- produces and sells
electric energy, capacity and ancillary services in key U.S.
markets. The power generation portfolio consists of approximately
12,200 megawatts of baseload, intermediate and peaking power
plants fueled by a mix of natural gas, coal and fuel oil.
In August, Dynegy implemented an internal restructuring that
created two units, one owning eight primarily natural gas-fired
power generation facilities and another owning six coal-fired
plants.
Dynegy missed a $43.8 million interest payment Nov. 1, 2011, and
said it was discussing options for managing its debt load with
certain bondholders.
Dynegy Holdings LLC and four other affiliates of Dynegy Inc.
sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case
No. 11-38111) Nov. 7 to implement an agreement with a
group of investors holding more than $1.4 billion of senior notes
issued by Dynegy's direct wholly-owned subsidiary, Dynegy
Holdings, regarding a framework for the consensual restructuring
of more than $4.0 billion of obligations owed by DH. If this
restructuring support agreement is successfully implemented, it
will significantly reduce the amount of debt on the Company's
consolidated balance sheet.
Dynegy Holdings disclosed assets of $13.77 billion and debt of
$6.18 billion, while Roseton LLC and Dynegy Danskammer LLC each
estimated $100 million to $500 million in assets and debt.
Dynegy Holdings and its affiliated debtor-entities are represented
in the Chapter 11 proceedings by Sidley Austin LLP as their
reorganization counsel. Dynegy and its other subsidiaries are
represented by White & Case LLP, who is also special counsel to
the Debtor Entities with respect to the Roseton and Danskammer
lease rejection issues.
Dynegy was advised by Lazard Freres & Co. LLC and the Debtor
Entities' financial advisor is FTI Consulting.
The Official Committee of Unsecured Creditors has tapped Akin Gump
Strauss Hauer & Feld LLP as counsel nunc pro tunc to November 16,
2011.
Bankruptcy Creditors' Service, Inc., publishes DYNEGY BANKRUPTCY
NEWS. The newsletter tracks the Chapter 11 proceeding undertaken
by affiliates of Dynegy Inc. (http://bankrupt.com/newsstand/or
215/945-7000)
DYNEGY INC: WTC Wants Creditors Meeting After Trustee Named
-----------------------------------------------------------
Wilmington Trust N.A. asked Judge Cecilia Morris of the U.S.
Bankruptcy Court for the Southern District of New York to direct
the U.S. Trustee to promptly convene a meeting of creditors if she
decides to appoint a bankruptcy trustee.
The U.S. Trustee, an agency of the U.S. Department of Justice
overseeing bankruptcy cases, previously proposed the appointment
of a trustee who would take over Dynegy Holdings LLC's bankruptcy
case. The agency cited mismanagement of the company by its
executives.
Wilmington Trust said a meeting required by Section 1104(b) of the
Bankruptcy Code should be convened no later than three days from
the appointment of a trustee so that creditors can elect the
trustee.
Meanwhile, Claren Road Asset Management LLC and CQS DO S1 Limited
filed court papers expressing support for appointment of a
bankruptcy trustee.
Wilmington Trust is represented by:
Mark R. Somerstein
ROPES & GRAY LLP
1211 Avenue of the Americas
New York, NY 10036-8704
Tel: (212) 596-9000
Fax: (212) 596-9090
E-mail: mark.somerstein@ropesgray.com
Claren Road is represented by:
Matthew J. Williams
GIBSON, DUNN & CRUTCHER LLP
200 Park Avenue
New York, NY 10166-0193
Tel: (212) 351-4000
Fax: (212) 351-4035
E-mail: mjwilliams@gibsondunn.com
CQS DO is represented by:
Paul N. Silverstein
ANDREWS KURTH LLP
450 Lexington Avenue, 15th Floor
New York, NY 10017
Tel: (212) 850-2800
Fax: (212) 850-2929
E-mail: paulsilverstein@andrewskurth.com
About Dynegy Inc.
Through its subsidiaries, Houston, Texas-based Dynegy Inc.
(NYSE: DYN) -- http://www.dynegy.com/-- produces and sells
electric energy, capacity and ancillary services in key U.S.
markets. The power generation portfolio consists of approximately
12,200 megawatts of baseload, intermediate and peaking power
plants fueled by a mix of natural gas, coal and fuel oil.
In August, Dynegy implemented an internal restructuring that
created two units, one owning eight primarily natural gas-fired
power generation facilities and another owning six coal-fired
plants.
Dynegy missed a $43.8 million interest payment Nov. 1, 2011, and
said it was discussing options for managing its debt load with
certain bondholders.
Dynegy Holdings LLC and four other affiliates of Dynegy Inc.
sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case
No. 11-38111) Nov. 7 to implement an agreement with a
group of investors holding more than $1.4 billion of senior notes
issued by Dynegy's direct wholly-owned subsidiary, Dynegy
Holdings, regarding a framework for the consensual restructuring
of more than $4.0 billion of obligations owed by DH. If this
restructuring support agreement is successfully implemented, it
will significantly reduce the amount of debt on the Company's
consolidated balance sheet.
Dynegy Holdings disclosed assets of $13.77 billion and debt of
$6.18 billion, while Roseton LLC and Dynegy Danskammer LLC each
estimated $100 million to $500 million in assets and debt.
Dynegy Holdings and its affiliated debtor-entities are represented
in the Chapter 11 proceedings by Sidley Austin LLP as their
reorganization counsel. Dynegy and its other subsidiaries are
represented by White & Case LLP, who is also special counsel to
the Debtor Entities with respect to the Roseton and Danskammer
lease rejection issues.
Dynegy was advised by Lazard Freres & Co. LLC and the Debtor
Entities' financial advisor is FTI Consulting.
The Official Committee of Unsecured Creditors has tapped Akin Gump
Strauss Hauer & Feld LLP as counsel nunc pro tunc to November 16,
2011.
Bankruptcy Creditors' Service, Inc., publishes DYNEGY BANKRUPTCY
NEWS. The newsletter tracks the Chapter 11 proceeding undertaken
by affiliates of Dynegy Inc. (http://bankrupt.com/newsstand/or
215/945-7000)
DYNEGY INC: Hearing on More Plan Exclusivity Wednesday
------------------------------------------------------
The U.S. Bankruptcy Court in Manhattan issued an ex parte bridge
order extending Dynegy Holdings LLC's exclusive period to file a
Chapter 11 plan until final determination of the company's motion
to extend the exclusive period. A court hearing to consider
approval of the motion is scheduled for April 4, 2012.
As reported in the March 1, 2012 edition of the Troubled Company
Reporter, the Debtors are asking the Court to extend the exclusive
period for them to file a Chapter 11 plan of reorganization for an
additional 120 days through and including July 5, 2012, and their
exclusive period to solicit acceptances of that plan for an
additional 180 days through and including September 3, 2012.
In light of the substantial strides toward plan confirmation that
have been made to date, it is critical that the Debtors be
permitted to continue this process without disruption, Debtors'
counsel Sophia P. Mullen, Esq., at Sidley Austin LLP, in New York,
contends.
About Dynegy Inc.
Through its subsidiaries, Houston, Texas-based Dynegy Inc.
(NYSE: DYN) -- http://www.dynegy.com/-- produces and sells
electric energy, capacity and ancillary services in key U.S.
markets. The power generation portfolio consists of approximately
12,200 megawatts of baseload, intermediate and peaking power
plants fueled by a mix of natural gas, coal and fuel oil.
In August, Dynegy implemented an internal restructuring that
created two units, one owning eight primarily natural gas-fired
power generation facilities and another owning six coal-fired
plants.
Dynegy missed a $43.8 million interest payment Nov. 1, 2011, and
said it was discussing options for managing its debt load with
certain bondholders.
Dynegy Holdings LLC and four other affiliates of Dynegy Inc.
sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case
No. 11-38111) Nov. 7 to implement an agreement with a
group of investors holding more than $1.4 billion of senior notes
issued by Dynegy's direct wholly-owned subsidiary, Dynegy
Holdings, regarding a framework for the consensual restructuring
of more than $4.0 billion of obligations owed by DH. If this
restructuring support agreement is successfully implemented, it
will significantly reduce the amount of debt on the Company's
consolidated balance sheet.
Dynegy Holdings disclosed assets of $13.77 billion and debt of
$6.18 billion, while Roseton LLC and Dynegy Danskammer LLC each
estimated $100 million to $500 million in assets and debt.
Dynegy Holdings and its affiliated debtor-entities are represented
in the Chapter 11 proceedings by Sidley Austin LLP as their
reorganization counsel. Dynegy and its other subsidiaries are
represented by White & Case LLP, who is also special counsel to
the Debtor Entities with respect to the Roseton and Danskammer
lease rejection issues.
Dynegy was advised by Lazard Freres & Co. LLC and the Debtor
Entities' financial advisor is FTI Consulting.
The Official Committee of Unsecured Creditors has tapped Akin Gump
Strauss Hauer & Feld LLP as counsel nunc pro tunc to November 16,
2011.
Bankruptcy Creditors' Service, Inc., publishes DYNEGY BANKRUPTCY
NEWS. The newsletter tracks the Chapter 11 proceeding undertaken
by affiliates of Dynegy Inc. (http://bankrupt.com/newsstand/or
215/945-7000)
E-DEBIT GLOBAL: Delays Form 10-K for 2011
-----------------------------------------
E-Debit Global Corporation was unable without unreasonable effort
and expense to compile, disseminate and review the information
required to be presented in the subject Form 10-K for the period
ended Dec. 31, 2011, before the required filing date for that
form.
About E-Debit Global Corporation
E-Debit Global Corporation (WSHE) is a financial holding company
in Canada at the forefront of debit, credit and online computer
banking. Currently, the Company has established a strong presence
in the privately owned Canadian banking sector including Automated
Banking Machines (ABM), Point of Sale Machines (POS), Online
Computer Banking (OCB) and E-Commerce Transaction security and
payment. E-Debit maintains and services a national ABM network
across Canada and is a full participating member of the Canadian
INTERAC Banking System.
The Company reported a net loss of $1.15 million on $3.97 million
of total revenue for the year ended Dec. 31, 2010, compared with a
net loss of $1.28 million on $3.64 million of revenue during the
prior year.
The Company also reported a net loss of $754,892 on $2.58 million
of total revenue for the nine months ended Sept. 30, 2011,
compared with a net loss of $778,092 on $2.99 million of total
revenue for the same period during the prior year.
The Company's balance sheet at Sept. 30, 2011, showed $1.51
million in total assets, $2.51 million in total liabilities and a
$1 million total stockholders' deficit.
As reported by the TCR on April 15, 2011, Cordovano and Honeck
LLP, in Englewood, Colorado, 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, has a working capital
deficit at Dec. 31, 2010, and has an accumulated deficit of
$4,457,079 as of Dec. 31, 2010.
EAST COAST CABLEVISION: Dist. Court Won't Stay Sky Cable Suit
-------------------------------------------------------------
District Judge Michael F. Urbanski denied Randy Coley's request to
stay a lawsuit filed by Sky Cable, LLC, pursuant to F.R.C.P. Rule
19, or in the alternative, to dismiss the amended complaint and
cross-claim pursuant to F.R.C.P. Rule 12(b)(7), for failure to
join a necessary party. Mr. Coley asserts that East Coast
Cablevision, LLC, of which he is sole member and manager, is a
necessary and indispensable party to this litigation. East Coast
Cablevision is not a named defendant in the action. Because East
Coast Cablevision has filed for bankruptcy and the automatic stay
remains in effect, Mr. Coley asks the Court to stay the lawsuit
for 45 days and schedule a status conference thereafter to
determine how to proceed given the status of the bankruptcy
proceeding. The Court is not persuaded by Mr. Coley's arguments.
The Court declines to delay the proceeding solely because of the
bankruptcy of East Coast Cablevision. The Court notes that the
case concerns allegations that Mr. Coley fraudulently entered into
a SMATV Agreement with DIRECTV two years before East Coast
Cablevision was formed in 2001. The Plaintiffs claim Mr. Coley
"played fast and loose with his entities and business practices,"
and that he operated prior to 2001 using a variety of trade names.
It may well be that East Coast Cablevision is a joint tortfeasor
in this action. But, the Court notes, it is well settled that
Rule 19 does not require the mandatory joinder of joint
tortfeasors and co-conspirators. The Court does not believe that
East Coast Cablevision is a necessary and indispensable party to
the action and declines to stay the matter in light of the ongoing
bankruptcy proceedings.
The adversary case is Sky Cable, LLC, et al., v. Randy Coley, et
al., Civil Action No. 5:11cv00048 (W.D. Va.). A copy of the
District Court's March 23, 2012 Memorandum Opinion is available at
http://is.gd/MdarK4from Leagle.com.
East Coast Cablevision, LLC -- ta Resort Cable LLC and ta Resort
Cable -- filed for Chapter 11 bankruptcy (Bankr. E.D.N.C. Case No.
11-08976) on Nov. 23, 2011. A copy of the petition is available
at no charge at http://bankrupt.com/misc/nceb11-08976.pdf Trawick
H. Stubbs, Jr., Esq., at Stubbs & Perdue, P.A., serves as the
Debtor's counsel.
EAT AT JOE'S: Incurs $152,900 Net Loss in 2011
----------------------------------------------
Eat at Joe's, Ltd., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss of
$152,900 on $1.07 million of revenue in 2011, compared with a net
loss of $621,800 on $1.24 million of revenue in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $1.60 million
in total assets, $5.03 million in total liabilities, and a $3.42
million total stockholders' deficit.
For 2011, Robison, Hill & Co., in Salt Lake City, Utah, noted that
the Company has suffered recurring losses from operations and has
a net capital deficiency that raise substantial doubt about its
ability to continue as a going concern.
A copy of the Form 10-K is available for free at:
http://is.gd/yxEFF1
About Eat at Joe's
Scarsdale, N.Y.-based Eat at Joe's, Ltd., presently owns and
operates one theme restaurant located in Philadelphia,
Pennsylvania.
ENERGY CONVERSION: Gets Nod to Hire Plante & Moran as Accountant
----------------------------------------------------------------
The Hon. Thomas J. Tucker of the U.S. Bankruptcy Court for the
Eastern District of Michigan has granted Energy Conversion
Devices, Inc., et al., permission to employ Plante & Moran, PLLC
as accountant.
As reported by the Troubled Company Reporter on March 16, 2012,
the Debtors sought to retain P&M to perform certain accounting,
consulting services, and other financial analyses. Aaron M.
Silver, Esq., at Honigman Miller Schwartz And Cohn LLP, proposed
counsel for the Debtors, said that P&M has been engaged since
September 2011 and has developed an extensive knowledge of the
company's background, operations, financial systems and financial
information. The Debtors are seeking authority to retain P&M to
continue rendering the accounting services. The Debtors may
engage P&M to provide other financial and related assistance,
which services may range from financial staffing assistance to
information technology assistance. P&M will not formally audit
any of the Debtors.
About Energy Conversion Devices
Energy Conversion Devices -- http://energyconversiondevices.com/
-- has a renowned 51 year history since its formation in Detroit,
Michigan and has been a pioneer in materials science and renewable
energy technology development. The company has been awarded over
500 U.S. patents and international counterparts for its
achievements. ECD's United Solar wholly owned subsidiary has been
a global leader in building-integrated and rooftop photovoltaics
for over 25 years. The company manufactures, sells and installs
thin-film solar laminates that convert sunlight to clean,
renewable energy using proprietary technology.
Energy Conversion Devices filed for Chapter 11 relief (Bankr. E.D.
Mich. Case No. 12-43166) on Feb. 14, 2012. Judge Thomas J. Tucker
presides over the case. Aaron M. Silver, Esq., Judy B. Calton,
Esq., and Robert B. Weiss, Esq., at Honigman Miller Schwartz &
Cohn LLP, in Detroit, Michigan, represent the Debtor as counsel.
The Debtor estimated assets and debts of between $100 million and
$500 million as of the petition date.
The petition was signed by William Christopher Andrews, chief
financial officer and executive vice president.
Affiliate United Solar Ovonic LLC filed a separate Chapter 11
petition on the same day (Bankr. E.D. Mich. Case No. 12-43167).
Affiliate Solar Integrated Technologies, Inc., filed a petition
for relief under Chapter 7 of the Bankruptcy Code (Bankr. E.D.
Mich. Case No. 12-43169.
ENERGY CONVERSION: Can Hire AlixPartners as Financial Advisor
-------------------------------------------------------------
Energy Conversion Devices, Inc., et al., have obtained permission
from the Hon. Thomas J. Tucker of the U.S. Bankruptcy Court for
the Eastern District of Michigan to retain AlixPartners, LLP, as
financial advisors for the Debtors nunc pro tunc to the Petition
Date.
According to the Troubled Company Reporter on March 7, 2012,
Energy Conversion has proposed to tap AlixPartners as financial
advisor at these hourly rates: managing director at $815 to $970,
director at $620 to $760, vice president at $455 to $555,
associate at $305 to $405, analyst at $270 to $300 and
paraprofessional at $205 to $225.
Ted Stenger, Managing Director at AlixPartners, attested that the
firm is a "disinterested person" within the meaning of section
101(14) of the Bankruptcy Code; and does not hold or represent an
interest adverse to the Debtors' estates in connection with any
matter on which GCG will be employed.
About Energy Conversion Devices
Energy Conversion Devices -- http://energyconversiondevices.com/
-- has a renowned 51 year history since its formation in Detroit,
Michigan and has been a pioneer in materials science and renewable
energy technology development. The company has been awarded over
500 U.S. patents and international counterparts for its
achievements. ECD's United Solar wholly owned subsidiary has been
a global leader in building-integrated and rooftop photovoltaics
for over 25 years. The company manufactures, sells and installs
thin-film solar laminates that convert sunlight to clean,
renewable energy using proprietary technology.
Energy Conversion Devices filed for Chapter 11 relief (Bankr. E.D.
Mich. Case No. 12-43166) on Feb. 14, 2012. Judge Thomas J. Tucker
presides over the case. Aaron M. Silver, Esq., Judy B. Calton,
Esq., and Robert B. Weiss, Esq., at Honigman Miller Schwartz &
Cohn LLP, in Detroit, Michigan, represent the Debtor as counsel.
The Debtor estimated assets and debts of between $100 million and
$500 million as of the petition date.
The petition was signed by William Christopher Andrews, chief
financial officer and executive vice president.
Affiliate United Solar Ovonic LLC filed a separate Chapter 11
petition on the same day (Bankr. E.D. Mich. Case No. 12-43167).
Affiliate Solar Integrated Technologies, Inc., filed a petition
for relief under Chapter 7 of the Bankruptcy Code (Bankr. E.D.
Mich. Case No. 12-43169.
ENERGY CONVERSION: Can Hire Covington & Burling as Special Counsel
------------------------------------------------------------------
The Hon. Thomas J. Tucker of the U.S. Bankruptcy Court for the
Eastern District of Michigan has granted Energy Conversion
Devices, Inc., et al., permission to employ Covington & Burling
LLP as special counsel.
As reported by the Troubled Company Reporter on Feb. 23, 2012,
Covington has represented the Debtors since 2007 in a wide
spectrum of matters maintaining a group of attorneys that have
worked closely with the Debtors, each other, and the Debtors'
other attorneys and professionals, to provide coordinated, non-
duplicative legal services for all assigned matters. Covington
will, among others: (i) assist in the potential disposition of
assets and other complex commercial transactions; and (ii) provide
legal advice regarding securities law compliance, corporate
governance, tax, employee benefits, intellectual property and
regulatory compliance. ECD is aware that there might be disputes
between the ECD estate and the USO estate on inter-debtor issues,
like the proper characterization of ECD's advances to USO, whether
ECD's claim against USO should be equitably subordinated, whether
there should be substantive consolidation of the Debtors' estates
and potentially other issues. ECD said any dispute will be
resolved by a consensual reorganization plan. ECD and Honigman
Miller Schwartz and Cohn LLP, its general bankruptcy counsel,
agreed that, if there are actual disputes among the Debtors'
estates regarding the proper characterization of the advances from
ECD to USO or other issues, Honigman won't represent any of the
Debtors in these disputes. Instead, special counsel or the
unsecured creditors' committees of each estate will handle the
disputes.
About Energy Conversion Devices
Energy Conversion Devices -- http://energyconversiondevices.com/
-- has a renowned 51 year history since its formation in Detroit,
Michigan and has been a pioneer in materials science and renewable
energy technology development. The company has been awarded over
500 U.S. patents and international counterparts for its
achievements. ECD's United Solar wholly owned subsidiary has been
a global leader in building-integrated and rooftop photovoltaics
for over 25 years. The company manufactures, sells and installs
thin-film solar laminates that convert sunlight to clean,
renewable energy using proprietary technology.
Energy Conversion Devices filed for Chapter 11 relief (Bankr. E.D.
Mich. Case No. 12-43166) on Feb. 14, 2012. Judge Thomas J. Tucker
presides over the case. Aaron M. Silver, Esq., Judy B. Calton,
Esq., and Robert B. Weiss, Esq., at Honigman Miller Schwartz &
Cohn LLP, in Detroit, Michigan, represent the Debtor as counsel.
The Debtor estimated assets and debts of between $100 million and
$500 million as of the petition date.
The petition was signed by William Christopher Andrews, chief
financial officer and executive vice president.
Affiliate United Solar Ovonic LLC filed a separate Chapter 11
petition on the same day (Bankr. E.D. Mich. Case No. 12-43167).
Affiliate Solar Integrated Technologies, Inc., filed a petition
for relief under Chapter 7 of the Bankruptcy Code (Bankr. E.D.
Mich. Case No. 12-43169.
ENERGY TRANSFER: S&P Hikes Corp. Credit Ratings to 'BB'; Off Watch
------------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
ratings on Energy Transfer Equity L.P. (ETE) to 'BB' from 'BB-'
and removed them from CreditWatch, where they were placed with
positive implications on Feb. 23, 2012. The outlook is stable. "We
raised the ratings on ETE's senior notes to 'BB' from 'BB-' and
assigned a 'BB' rating to the $2.3 billion term bank loan due
2019; our recovery rating on both the notes and term loan is '3'.
At the same time, we affirmed our corporate credit ratings on
Southern Union Co. (SUG) and removed them from CreditWatch with
negative implications. The ratings were originally placed on
CreditWatch with developing implications on July 20, 2011; the
CreditWatch implications were revised to negative on Nov. 15,
2011. The outlook is stable. In addition, we affirmed our ratings
on subsidiaries Energy Transfer Partners L.P. (BBB-/Negative/--)
and Regency Energy Partners L.P. (BB/Stable/--)," S&P said.
"The upgrade on Energy Transfer Equity L.P. [ETE] is based on our
view that ETE is now a larger, more diverse entity with additional
stable cash flow producing assets and the inclusion of Southern
Union Co. [SUG] into ETE's asset base enables slightly higher debt
leverage metrics for the 'BB' rating," said Standard & Poor's
credit analyst William Ferara. "The acquisition also results in a
noticeable improvement in ETE's cash flow diversity, which reduces
its reliance on incentive distribution cash flows from Energy
Transfer Partners L.P. (ETP) and Regency Energy Partners L.P.
(RGP) (primarily ETP)," S&P said.
"We affirmed our ratings on SUG because there is no change in our
view of the company's business and financial risk profile. We
allowed for some ratings separation as certain structural features
are in place between ETE and SUG. Specifically, SUG amended and
included key provisions within its certificate of incorporation to
ensure separateness. SUG will have an independent director on its
board, whose vote is required for a potential bankruptcy filing or
to amend its certificate of incorporation. Also present is a
substantive nonconsolidation opinion, to the effect that SUG would
not be substantively consolidated with ETE if ETE files for
bankruptcy. Ratings between the two, however, are still linked
because SUG is a wholly owned subsidiary of ETE and effectively
controls its balance sheet and dividend actions. SUG warrants a
'BBB-' rating on a stand-alone basis, in our view, and we expect
it to maintain debt to EBITDA in the low-4x area and to reduce
holding company debt accordingly pro forma for any potential asset
sales," S&P said.
"The stable rating outlook on ETE reflects our expectation for
continued stability in the distribution payments it receives from
its ownership interests in ETP, SUG, and RGNC. We expect ETE to
slightly deleverage its balance sheet following the SUG
transaction, with stand-alone and consolidated debt to EBITDA of
roughly 3.5x and 5.5x. We could lower the ratings on ETE if its
stand-alone or consolidated debt to EBITDA ratios are sustained
above 4x and 6x, respectively, or if it pursues large acquisitions
that do not improve its business risk or consolidated cash flow
profile. A downgrade of ETP would not necessarily lead to a lower
rating on ETE unless we believe there is a greater risk that
distributions to ETE will decrease. Higher ratings on ETE are not
contemplated, absent a materially more conservative financial
policy," S&P said.
EOS PREFERRED: Delays Form 10-K for 2011
----------------------------------------
EOS Preferred Corporation is in the process of finalizing certain
disclosures with respect to the presentation of certain financial
information relevant to its consolidated financial statements to
be included in its Form 10-K to be filed for the year ended
Dec. 31, 2011. In addition, the Company is finalizing the process
of liquidation and dissolution pursuant to a Plan of Liquidation
and Dissolution approved by the Board of Directors on March 12,
2012. The Company expects to file within the extension period.
About EOS Preferred
Based in New York, EOS Preferred Corporation (formerly Capital
Crossing Preferred Corporation) is a Massachusetts corporation
with the principal business objective to hold mortgage assets that
will generate net income for distribution to stockholders. The
Company was organized on March 20, 1998, to acquire and hold real
estate assets and Aurora Bank FSB, an indirect wholly-owned
subsidiary of Lehman Brothers Holdings Inc., owns all of the
Company's common stock. Effective June 21, 2010, the Company
changed its corporate name to EOS Preferred Corporation.
The Company operates in a manner intended to allow its to be taxed
as a real estate investment trust, or a "REIT," under the Internal
Revenue Code of 1986, as amended. As a REIT, EOS will not be
required to pay federal or state income tax if it distributes its
earnings to its shareholders and continues to meet a number of
other requirements.
As reported by the TCR on April 6, 2011, Ernst & Young LLP, in New
York, expressed substantial doubt about the Company's ability to
continue as a going concern. On Sept. 15, 2008, Lehman Brothers
Holdings Inc., indirect parent company to Aurora Bank FSB, and
ultimate parent company of EOS Preferred Corporation, filed a
voluntary petition under Chapter 11 of the U.S. Bankruptcy Code.
Aurora Bank, the sole owner of the common stock of EOS Preferred
Corporation, is subject to a Cease and Desist Order, dated Jan.
26, 2009, and a Prompt Corrective Action Directive, dated Feb. 4,
2009, issued by the Office of Thrift Supervision, requiring Aurora
Bank, among other matters, to submit a capital restoration plan
and a liquidity management plan, and imposing restrictions on
certain activities of Aurora Bank and EOS Preferred Corporation.
According to the independent auditors, the bankruptcy of Lehman
Brothers and the ability of the OTS to regulate and restrict the
business and operations of EOS Preferred Corporation, in light of
the Cease and Desist Order and the Prompt Corrective Action
Directive, raise substantial doubt about EOS Preferred
Corporation's ability to continue as a going concern.
The Company's balance sheet at Sept. 30, 2011, showed
$87.07 million in total assets, $357,000 in total liabilities, and
$86.71 million in total stockholders' equity.
EOS PREFERRED: Voluntarily Delists Preferred Shares on NASDAQ
-------------------------------------------------------------
EOS Preferred Corporation filed with the U.S. Securities and
Exchange Commission a Form 25 regarding the voluntary removal from
listing of its 8.50% Non-Cumulative Exchangeable Preferred Stock,
Series D, under the NASDAQ-OMX.
About EOS Preferred
Based in New York, EOS Preferred Corporation (formerly Capital
Crossing Preferred Corporation) is a Massachusetts corporation
with the principal business objective to hold mortgage assets that
will generate net income for distribution to stockholders. The
Company was organized on March 20, 1998, to acquire and hold real
estate assets and Aurora Bank FSB, an indirect wholly-owned
subsidiary of Lehman Brothers Holdings Inc., owns all of the
Company's common stock. Effective June 21, 2010, the Company
changed its corporate name to EOS Preferred Corporation.
The Company operates in a manner intended to allow its to be taxed
as a real estate investment trust, or a "REIT," under the Internal
Revenue Code of 1986, as amended. As a REIT, EOS will not be
required to pay federal or state income tax if it distributes its
earnings to its shareholders and continues to meet a number of
other requirements.
As reported by the TCR on April 6, 2011, Ernst & Young LLP, in New
York, expressed substantial doubt about the Company's ability to
continue as a going concern. On Sept. 15, 2008, Lehman Brothers
Holdings Inc., indirect parent company to Aurora Bank FSB, and
ultimate parent company of EOS Preferred Corporation, filed a
voluntary petition under Chapter 11 of the U.S. Bankruptcy Code.
Aurora Bank, the sole owner of the common stock of EOS Preferred
Corporation, is subject to a Cease and Desist Order, dated Jan.
26, 2009, and a Prompt Corrective Action Directive, dated Feb. 4,
2009, issued by the Office of Thrift Supervision, requiring Aurora
Bank, among other matters, to submit a capital restoration plan
and a liquidity management plan, and imposing restrictions on
certain activities of Aurora Bank and EOS Preferred Corporation.
According to the independent auditors, the bankruptcy of Lehman
Brothers and the ability of the OTS to regulate and restrict the
business and operations of EOS Preferred Corporation, in light of
the Cease and Desist Order and the Prompt Corrective Action
Directive, raise substantial doubt about EOS Preferred
Corporation's ability to continue as a going concern.
The Company's balance sheet at Sept. 30, 2011, showed $87.07
million in total assets, $357,000 in total liabilities and $86.71
million in total stockholders' equity.
EURAMAX INT'L: S&P Affirms 'B-' Rating on $375MM Sr. Secured Notes
------------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its issue-level rating
and revised its recovery rating on U.S.-based Euramax
International Inc.'s (B-/Stable/--) $375 million senior secured
notes due 2016. "We affirmed the 'B-' issue rating (same as the
corporate credit rating) on these notes and revised the recovery
rating to '4' from '3'. The '4' recovery rating indicates our
expectations for average (30% to 50%) recovery in the event of a
payment default," S&P said.
"We revised the recovery ratings on U.S.-based building products
manufacturer Euramax International Inc. to better capture the
potential that asset-based lending credit facility claims could
dampen recovery prospects for noteholders." said Standard & Poor's
credit analyst Gayle Bowerman.
"The ratings on U.S.-based Euramax International Inc. reflect
Standard & Poor's view of the company's highly leveraged financial
risk profile given its substantial debt load and low interest
coverage metrics. Our ratings also incorporate our view of
Euramax's 'weak' business risk reflected in its significant
exposure to challenging residential and nonresidential
construction markets and volatile raw material costs," S&P said.
RATINGS LIST
Euramax International Inc.
Corporate credit rating B-/Stable/--
Rating Affirmed; Recovery Rating Revised
To From
$375 mil sr secd notes due 2016 B- B-
Recovery rating 4 3
EVERGREEN COUNTRY: S&P Cuts Series 2007 Revenue Bond Rating to 'D'
------------------------------------------------------------------
Standard & Poor's Ratings Services has lowered its long-term
rating to 'D' from 'CCC' on the Colorado Housing & Finance
Authority's series 2007 revenue bonds issued for Evergreen Country
Day School (ECDS). The default rating reflects Standard & Poor's
opinion of the obligor's inability to pay the series 2007 bonds in
full.
"The downgrade follows ECDS's failure to meet its financial ratio
bond covenants over a span of multiple years and the inability of
ECDS to restructure its debt in a manner that would have allowed
the school to meet its debt service over the full maturity of the
bonds," said Standard & Poor's credit analyst Blake Cullimore. "At
the time of the default and negotiated settlement, the outstanding
amount of bonds was $12.95 million," said Mr. Cullimore.
"Due to the school's inability to continue to pay principal and
interest, the bond trustee acting at the direction and consent of
100% of the bondholders accelerated the bonds. After negotiating
with bondholders, according to ECDS management, there was a cash
distribution of $9.2 million after payment of fees and expenses
from the trustee to the bondholders on Feb. 17, 2012, amounting to
the bondholders receiving approximately 70% of the principal of
the bonds. The bonds are no longer outstanding. The total amount
received by the bondholders was less than the outstanding amount
of bonds," S&P said.
EZENIA INC: Plans to Move HQ to Seattle Near Microsoft
------------------------------------------------------
Bob Sanders at New Hampshire Business Review reports that Ezenia
may be moving out of its Nashua headquarters to Seattle,
Washington to be near Microsoft.
According to the report, the company is "in the process of
developing and implementing a program to reduce core operating
costs and make operational improvements, including downsizing and
moving its headquarters." The company has filed papers asking the
court to sell off assets of less than $7,500 without additional
filings.
The report says the company has not yet decided if or when it will
move, nor what the fate of the half-dozen employees who are still
in Nashua. It currently leases its existing space in Nashua, but
that lease expires soon.
Based in Nashua, New Hampshire, Ezenia! Inc., a publicly traded
software company, filed for Chapter 11 protection (Bankr. D. N.H.
Case No. 11-13664) on Sept. 30, 2011. Judge J. Michael Deasy
presides over the case. Daniel W. Sklar, Esq., at Nixon Peabody
LLP, represents the Debtor. Ezenia! Inc. disclosed assets of $2.5
million and debts of close to $900,000. Its largest asset --
worth $2.4 million -- is a prepaid licensing contract with
Microsoft Corp.
FOUNDATIONS INC: State Court Rules in Eliazer Ortiz Lawsuit
-----------------------------------------------------------
Cynthia Gomez and Foundations, Inc., appeal from a judgment in
favor of Eliazer and Silvia Ortiz in an action arising out of a
contract to purchase residential property. Ms. Gomez also appeals
from the postjudgment order awarding attorney fees to the Ortizes.
As to the appeal from the judgment, the Court of Appeals of
California, Second District, Division Four, concluded that Ms.
Gomez failed to file a timely notice of appeal and therefore the
appeal from the judgment must be dismissed. Regarding the order
awarding attorney fees, the Court of Appeals found no abuse of
discretion and affirmed the order in favor of the Ortizes.
On May 5, 2006, the parties entered into a purchase agreement for
the sale of a single family residence in Downey, California, which
was then under construction. The agreed-upon sales price was $2.1
million. Escrow was scheduled to close on July 7, 2006. The
purchase agreement listed Ms. Gomez as the seller; however,
Foundations was actually the legal owner of the property and
therefore the purchase agreement was amended to indicate
Foundations was the owner of title. Ms. Gomez had been married to
Lorenzo Espinoza, but the couple had separated in 2003 and
divorced in 2006; Foundations had become the legal owner of the
property in January 2005. When the sale of the property occurred,
Foundations was being operated by Mr. Espinoza, pursuant to the
terms of an order entered in the divorce proceedings. However,
the proceeds from the sale of the property were paid to Ms. Gomez
and used to pay her personal debts, again pursuant to the terms of
the divorce decree.
Construction was to be completed and a certificate of occupancy
was required to be issued before escrow could close. However,
escrow closed prematurely on June 19, 2006, before a certificate
of occupancy was obtained. The Ortizes nonetheless received
marketable title, free and clear of encumbrances. The COO was not
obtained until Nov. 9, 2006, almost four months after escrow
closed.
The case is Eliazer Ortiz et al., Plaintiffs and Respondents, v.
Cynthia Gomez et al., Defendants and Appellants, No. B226631
(Calif. App. Ct.). A copy of Justice Steven C. Suzukawa's March
28, 2012 Decision is available at http://is.gd/UgjyHEfrom
Leagle.com.
Based in Newport Coast, Calif., Foundations Inc., formerly
Foundations, LLC, filed for Chapter 11 protection (C.D.
Calif. Case No. 08-13321) on June 12, 2008. Foundations Inc.'s
debtor affiliate, Crown Plaza Development LLC, filed a separate
Chapter 11 petition on Feb. 20, 2008 (C.D. Case No. 08-10776).
When the Debtor filed for bankruptcy protection from its
creditors, it estimated assets of between $10 million and $50
million, and debts of $1 million and $10 million.
FREIF NORTH AMERICA: S&P Keeps 'BB-' Corporate Credit Rating
------------------------------------------------------------
Standard & Poor's Ratings Services said its 'BBB-' ratings on Lea
Power Partners LLC's $305.4 million senior secured bonds remain on
CreditWatch, where they were placed with negative implications on
Dec. 22, 2011.
"The CreditWatch listing is based on the planned sale of Hobbs
Power Funding LLC, which owns Lea Power Partners, to FREIF North
American Power I," said Standard & Poor's credit analyst Theodore
Dewitt. A controlling interest in that entity will be held
indirectly by First Reserve Corp., an energy and infrastructure
private equity company.
First Reserve announced on Dec. 15, 2011, its plan to acquire a
number of assets from ArcLight Capital. Among these assets is
Hobbs Power Funding, which owns Lea Power Partners and indirectly
owns the Hobbs station, a 604 megawatt (MW) combined-cycle gas
turbine power plant in Hobbs, N.M. Lea Power is a special-purpose,
bankruptcy-remote entity that was formed to build own and operate
Hobbs, which entered commercial operation in September 2008.
ArcLight Energy Partners Fund III L.P., which is managed by
ArcLight Capital, indirectly owns Hobbs Power Funding and Lea
Power.
"Under the financing documents for Lea Power, a change-of-control
of Lea Power could result in an event of default. A change of
control occurs when ArcLight and any approved owners cease to hold
in aggregate, directly or indirectly, more than 50% of the equity
interest in Lea Power. An approved owner is defined as an entity
that is experienced in the ownership, construction, and operation
of gas-fired generating facilities similar to Hobbs Generation. If
First Reserve Corp. is evaluated to be an approved owner, an event
of default will not occur as a result of the proposed sale of
Hobbs Power Funding.
"To maintain our current 'BBB-' rating on Lea Power the new owning
entity would have to have creditworthiness equivalent to a 'BB-'
rated entity, given our parent-project ratings linkage criteria
guidelines for U.S. transactions with a single parent. We could
lower the rating if we view the new parent's creditworthiness to
be less than a 'BB-' equivalent," S&P said.
"The preliminary rating on FREIF North American Power I is 'BB-',
with a preliminary '2' recovery rating; the outlook is stable. Our
ratings on Lea Power will remain on CreditWatch until the
transaction closes and we finalize the rating," S&P said.
"We will look to resolve the CreditWatch placement on Lea Power
upon the close of the FREIF North American Power I transaction. We
expect this to occur in the second quarter of 2012," S&P said.
GENERAL MARITIME: Hearing Today on Plan Modifications
-----------------------------------------------------
General Maritime Corporation reached an agreement on a modified
plan of reorganization with the Official Committee of Unsecured
Creditors, funds managed by Oaktree Capital Management, L.P. and
their investment entities (the "Oaktree Funds") and holders of
more than 40% of the Company's Senior Notes. The Modified Plan is
also supported by 66-2/3% of the Company's key senior lenders,
including its bank group, led by Nordea Bank Finland plc, New York
Branch as administrative agent. The Modified Plan will allow for a
consensual reorganization of the Company, substantially deleverage
the Company's balance sheet, provide a greater recovery to
unsecured creditors, and position the Company to be a financially
stronger, competitive global enterprise.
Jeffrey D. Pribor, General Maritime's Chief Financial Officer,
said, "This is an important step to completing the restructuring
process. The Modified Plan, which is supported by our bank
lenders, the Oaktree Funds and the Creditors' Committee, provides
for enhanced recoveries for unsecured creditors and is designed to
clear a path to confirmation. Through this restructuring we are
strengthening our balance sheet and improving our financial
flexibility. We have made substantial progress, and we intend to
continue working with our stakeholders to position General
Maritime for long-term growth as a leading provider of
international seaborne energy transportation services."
Under the Modified Plan, the Company will no longer be
implementing the previously announced rights offering. Instead,
each class of claims or interests against the Company will receive
the same or better treatment than under the original plan of
reorganization. Holders of allowed unsecured claims against the
Company and its debtor subsidiaries that guarantee the Company's
obligations under its secured facilities will share in $6 million
in cash, warrants to purchase 3% of the equity in the reorganized
company and 2% of the reorganized equity, increasing their
estimated recovery from 0.75-1.88% under the original plan of
reorganization to approximately 5.41% under the Modified Plan. In
addition, the Modified Plan resolves all disputes between the
Company, the prepetition senior lenders, the Oaktree Funds,
certain large unsecured bondholders and the Creditors' Committee
with respect to the original plan, thereby avoiding the expense
and delay caused by a contested confirmation process.
The Modified Plan continues to provide for an infusion of
$175 million in new capital from the Oaktree Funds.
To facilitate the implementation of the agreed-upon restructuring,
the Company, the Oaktree Funds, the Creditors' Committee, and
holders of over 40% of the Senior Notes entered into a plan
support agreement. The Bankruptcy Court agreed to hear a motion
to approve the plan support agreement and modifications to the
plan on April 2nd at 10:00 a.m. ET.
Following the completion of the restructuring process, General
Maritime will reduce its funded indebtedness by approximately
$600 million and continue to provide international seaborne energy
transportation services.
The Modified Plan is subject to confirmation by the Bankruptcy
Court. The Company has extended the voting deadline on the
Modified Plan to April 25, 2012, from April 10, 2012, and has
scheduled a hearing on May 3, 2012, to seek confirmation of the
Modified Plan.
Kramer Levin Naftalis & Frankel LLP is serving as the Company's
legal advisor, and Moelis & Company is serving as the Company's
financial advisor.
About General Maritime
New York-based General Maritime Corporation, through its
subsidiaries, provides international transportation services of
seaborne crude oil and petroleum products. The Company's fleet is
comprised of VLCC, Suezmax, Aframax, Panamax and product carrier
vessels. The fleet consisted of 30 owned vessels and three
chartered vessels. The company generates substantially all of its
revenues by chartering its fleet to third-party customers. The
largest customers include major international oil companies, oil
producers, and oil traders such as BP, Chevron Corporation, CITGO
Petroleum Corp., ConocoPhillips, Exxon Mobil Corporation, Hess
Corporation, Lukoil Oil Company, Stena AB, and Trafigura.
General Maritime and 56 subsidiaries filed for Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 11-15285) on Nov. 17,
2011. Douglas Mannal, Esq., and Adam C. Rogoff, Esq., at Kramer
Levin Naftalis & Frankel LLP, in New York, serve as counsel to the
Debtors. Moelis & Company is the financial advisor. Garden City
Group Inc. is the claims and notice agent.
Prepetition, General Maritime reached agreements with its key
senior lenders, including its bank group, led by Nordea Bank
Finland plc, New York Branch as administrative agent, as well as
affiliates of Oaktree Capital Management, L.P., on the terms of a
restructuring. Under terms of the agreements, Oaktree will
provide a $175 million new equity investment in General Maritime
and convert its prepetition secured debt to equity.
In conjunction with the filing, General Maritime has received a
commitment for up to $100 million in new DIP financing from a
group of lenders led by Nordea as administrative agent.
Counsel for Nordea, as the DIP Agent and the Senior Agent, are
Thomas E. Lauria, Esq., and Scott Greissman, Esq., at White & Case
LLP. Counsel for Oaktree Capital Management, the Junior Agent,
are Edward Sassower, Esq., and Brian Schartz, Esq., at Kirkland &
Ellis, LLP.
The Official Committee of Unsecured Creditors appointed in the
case has retained lawyers at Jones Day as Chapter 11 counsel.
Jones Day previously represented an ad hoc group of holders of the
12% Senior Notes due 2017 issued by General Maritime Corp. This
representation began Sept. 20, 2011, and concluded Nov. 29, 2011,
with the agreement of all members of the Noteholders Committee.
The Creditors Committee also tapped Lowenstein Sandler PC as
special conflicts counsel.
The Noteholders Committee consisted of Capital Research and
Management Company, J.P. Morgan Investment Management, Inc., J.P.
Morgan Securities LLC, Stone Harbor Investment Partners LP and
Third Avenue Focused Credit Fund.
The Creditors Committee is comprised of Bank of New York Mellon
Corporate Trust, Stone Harbor Investment Partners, Delos
Investment Management, and Ultramar Agencia Maritima Ltda.
GENERAL MARITIME: Modified Plan Reduces Debt by $600 Million
------------------------------------------------------------
On March 26, 2012, General Maritime Corp., et al., filed a second
amended plan of reorganization (with the Bankruptcy Court. The
Modified Plan was filed with the support of the Official Committee
of Unsecured Creditors of the Company, the Oaktree Lender, the
Oaktree Funds, holders of over 40% of the Company's 12% Senior
Notes due November 15, 2017 (the "Senior Notes"), and more than
66-2/3% of the Company's senior lenders, including its bank group,
led by Nordea Bank Finland plc, New York Branch as administrative
agent.
The Modified Plan will allow for a consensual reorganization of
the Debtors, substantially deleverage the Debtors' balance sheet,
provide a greater recovery to the Debtors' unsecured creditors
than as provided for under the Original Plan, and position the
Debtors to be a financially stronger, competitive global
enterprise post-emergence. Through the Modified Plan, (i) the
Debtors' financial debt will be reduced by approximately
$600 million, (ii) the Debtors' cash interest expense will be
reduced by approximately $42 million annually, and (iii) the
Debtors will receive a new capital infusion of approximately
$175 million from the Oaktree Funds.
Under the Modified Plan, the Debtors will no longer be
implementing the previously announced rights offering. Instead,
each class of claims or interests against the Debtors will receive
the same or better treatment than they were to receive under the
Original Plan. Holders of allowed unsecured claims against the
Company and its Debtor subsidiaries that guarantee the Company's
obligations under its secured credit facilities (the "Guarantor
Debtors") will share in $6 million in cash, warrants exercisable
for up to three percent of the equity in the reorganized Company,
and two percent of the equity in the reorganized Company,
increasing their estimated recovery from 0.75-1.88% under the
Original Plan to approximately 5.41% under the Modified Plan. The
Modified Plan also provides that the Debtors' Prepetition Senior
Lender Group will continue to provide exit financing to the
Debtors, and provides that the Oaktree Funds and the Oaktree
Lender will receive 98% of the equity in the reorganized Company
for an infusion of $175 million in new capital from the Oaktree
Funds, and the conversion of $175 million of secured claims under
the credit agreement, dated March 29, 2011, as amended and
restated on May 6, 2011, by and among the Company, General
Maritime Subsidiary Corporation, General Maritime Subsidiary II
Corporation and OCM Marine Investments CTB, Ltd. (the "Oaktree
Lender"). In addition, the Modified Plan resolves all disputes
between and among the Debtors, the Prepetition Senior Lender
Group, the Oaktree Funds, the Oaktree Lender, holders of over 40%
of the Senior Notes, and the Creditors' Committee.
A copy of the Second Amended Chapter 11 Plan of Reorganization,
filed with the Bankruptcy Court on March 26, 2012, is available at
no charge at http://is.gd/mpfOoZ
Plan Support Agreement
On March 26, 2012, the Debtors entered into a Plan Support
Agreement with (i) the Oaktree Lender, (ii) the Creditors'
Committee, and (iii) the holders of over 40% of the Senior Notes.
Pursuant to the Plan Support Agreement, the Plan Support Parties
agreed to vote in favor of, or otherwise support, the Modified
Plan. The Plan Support Agreement is designed to facilitate a
consensual confirmation process among the Plan Support Parties.
The Bankruptcy Court agreed to hear a motion to approve the Plan
Support Agreement on April 2, 2012 at 10:00 a.m., Eastern Standard
Time.
A copy of the Plan Support Agreement is available for free at:
http://is.gd/Nuh1ba
First Amendment to Equity Purchase Agreement
The Company has entered into an Equity Purchase Agreement, dated
as of Dec. 15, 2011, as modified by the order issued by the
Bankruptcy Court on Dec. 15, 2011, and as further modified by the
Limited Waiver Agreement entered into on Feb. 27, 2012 (the
"Equity Purchase Agreement"), with Oaktree Principal Fund V, L.P.,
Oaktree Principal Fund V (Parallel), L.P., Oaktree FF Investment
Fund, L.P. ? Class A, and OCM Asia Principal Opportunities Fund,
L.P. (collectively, the "Oaktree Funds").
In connection with the Modified Plan, the Company and the Oaktree
Funds entered into the First Amendment to the Equity Purchase
Agreement, dated as of March 26, 2012 (the "EPA Amendment"). The
EPA Amendment provides for, among other things, (i) the issuance
by the Company to the Oaktree Funds of three percent of the equity
in the reorganized Company as a commitment fee, instead of
warrants exercisable for up to five percent of the equity in the
reorganized Company, (ii) a decrease in the minimum cash
requirements of the Company from $20 million to $14 million, (iii)
the consent of the Oaktree Funds to the filing, implementation and
confirmation of the Modified Plan, and (iv) other changes required
in connection with the execution of the Plan Support Agreement.
A copy of the EPA Amendment is available for free at:
http://is.gd/M9drVl
About General Maritime
New York-based General Maritime Corporation, through its
subsidiaries, provides international transportation services of
seaborne crude oil and petroleum products. The Company's fleet is
comprised of VLCC, Suezmax, Aframax, Panamax and product carrier
vessels. The fleet consisted of 30 owned vessels and three
chartered vessels. The company generates substantially all of its
revenues by chartering its fleet to third-party customers. The
largest customers include major international oil companies, oil
producers, and oil traders such as BP, Chevron Corporation, CITGO
Petroleum Corp., ConocoPhillips, Exxon Mobil Corporation, Hess
Corporation, Lukoil Oil Company, Stena AB, and Trafigura.
General Maritime and 56 subsidiaries filed for Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 11-15285) on Nov. 17,
2011. Douglas Mannal, Esq., and Adam C. Rogoff, Esq., at Kramer
Levin Naftalis & Frankel LLP, in New York, serve as counsel to the
Debtors. Moelis & Company is the financial advisor. Garden City
Group Inc. is the claims and notice agent.
Prepetition, General Maritime reached agreements with its key
senior lenders, including its bank group, led by Nordea Bank
Finland plc, New York Branch as administrative agent, as well as
affiliates of Oaktree Capital Management, L.P., on the terms of a
restructuring. Under terms of the agreements, Oaktree will
provide a $175 million new equity investment in General Maritime
and convert its prepetition secured debt to equity.
In conjunction with the filing, General Maritime has received a
commitment for up to $100 million in new DIP financing from a
group of lenders led by Nordea as administrative agent.
Counsel for Nordea, as the DIP Agent and the Senior Agent, are
Thomas E. Lauria, Esq., and Scott Greissman, Esq., at White & Case
LLP. Counsel for Oaktree Capital Management, the Junior Agent,
are Edward Sassower, Esq., and Brian Schartz, Esq., at Kirkland &
Ellis, LLP.
The Official Committee of Unsecured Creditors appointed in the
case has retained lawyers at Jones Day as Chapter 11 counsel.
Jones Day previously represented an ad hoc group of holders of the
12% Senior Notes due 2017 issued by General Maritime Corp. This
representation began Sept. 20, 2011, and concluded Nov. 29, 2011,
with the agreement of all members of the Noteholders Committee.
The Creditors Committee also tapped Lowenstein Sandler PC as
special conflicts counsel.
The Noteholders Committee consisted of Capital Research and
Management Company, J.P. Morgan Investment Management, Inc., J.P.
Morgan Securities LLC, Stone Harbor Investment Partners LP and
Third Avenue Focused Credit Fund.
The Creditors Committee is comprised of Bank of New York Mellon
Corporate Trust, Stone Harbor Investment Partners, Delos
Investment Management, and Ultramar Agencia Maritima Ltda.
GENERAL MARITIME: Seeks Approval of Plan Support Deal
-----------------------------------------------------
General Maritime Corporation, et al., ask the U.S. Bankruptcy
Court for the Southern District of New York to approve a plan
support agreement.
A hearing on the PSA is scheduled for April 2.
Prior to the Petition Date, the Debtors and holders of in excess
of 66-2/3% of the outstanding indebtedness under the (i)
Prepetition 2011 Facility; (ii) Prepetition 2010 Facility; and
(iii) OCM Facility, entered into a restructuring support agreement
that outlined the terms of a Plan of Reorganization. The
Restructuring Support Agreement was a major accomplishment,
however, as of the Petition Date, the Debtors did not have the
support of their major unsecured creditor constituents, including
holders of the Senior Notes.
After several months of negotiations, the Debtors have obtained
the support of both the Official Committee of Unsecured Creditors
and holders of more than 40% of the Senior Notes on the terms of
their Plan (the Global Settlement), as memorialized in the Plan
Support Agreement entered into between the Debtors, the Creditors
Committee, holders of more than 40% of the Senior Notes, and the
OCM Facility Lenders.
In addition, the DIP Lenders and holders of more than 66-2/3% in
amount of the Prepetition Senior Facilities have also expressed
their support for the Global Settlement and have informed the
Debtors of their intention to file a pleading in support of the
Modified Plan, indicating that the Modified Plan constitutes an
Acceptable Plan as defined in the DIP Credit Agreement.
To facilitate the implementation of the agreed-upon restructuring,
the parties have agreed to these key documents: (i) the Second
Amended Joint Plan of Reorganization of the Debtors Under Chapter
11 of the Bankruptcy Code; (ii) the Plan Support Agreement between
the Debtors, the OCM Facility Lenders, the Creditors Committee,
and the holders of approximately 40% of the Senior Notes; and
(iii) an amendment to the Equity Purchase Agreement among the
Debtors and the Oaktree Plan Sponsors governing the terms of the
New Equity Investment
The purpose of the Global Settlement is to restructure the
Debtors' liabilities, maximize the recovery to all stakeholders,
enhance the financial viability of the Reorganized Debtors, and
avoid the costs and risks associated with a contested confirmation
process on the Original Plan.
The Modified Plan provides that:
x) the Prepetition Senior Lenders will continue to provide exit
financing to the Reorganized Debtors through the refinancing of
the Prepetition Senior Facilities into the New Senior Facilities;
y) the OCM Facility Lenders and the Oaktree Plan Sponsors will
receive 98% of the Reorganized Debtors' equity on account of (i)
the OCM Facility Secured Claim (stipulated at $175 million), (ii)
the $175 million New Equity Investment, and (iii) the Commitment
Fee GMR Common Stock; and
z) holders of the Debtors' general unsecured claims against the
Guarantor Debtors, including claims arising under the $300 million
in Senior Notes, will share pro rata in (i) $6 million cash, (ii)
2% of the Reorganized Debtors' equity, and (iii) warrants to
purchase up to 3% additional equity of the Reorganized Debtors.
As a result of the Modified Plan, (i) the Debtors' financial debt
will be reduced by approximately $600 million, (ii) the Debtors'
cash interest expense will be reduced by approximately $42 million
annually, and (iii) the Debtors will receive a new capital
infusion of approximately $175 million from the Oaktree Plan
Sponsors.
A full-text copy of the PSA is available for free at:
http://bankrupt.com/misc/GENERALMARITIME_plansupportagreement.pdf
The Debtors set an April 2, 2012, hearing at 10:00 a.m.
(prevailing Eastern Time) on the approval of the PSA. Objections,
if any, are due March 29, at 12:00 p.m.
About General Maritime
New York-based General Maritime Corporation, through its
subsidiaries, provides international transportation services of
seaborne crude oil and petroleum products. The Company's fleet is
comprised of VLCC, Suezmax, Aframax, Panamax and product carrier
vessels. The fleet consisted of 30 owned vessels and three
chartered vessels. The company generates substantially all of its
revenues by chartering its fleet to third-party customers. The
largest customers include major international oil companies, oil
producers, and oil traders such as BP, Chevron Corporation, CITGO
Petroleum Corp., ConocoPhillips, Exxon Mobil Corporation, Hess
Corporation, Lukoil Oil Company, Stena AB, and Trafigura.
General Maritime and 56 subsidiaries filed for Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 11-15285) on Nov. 17,
2011. Douglas Mannal, Esq., and Adam C. Rogoff, Esq., at Kramer
Levin Naftalis & Frankel LLP, in New York, serve as counsel to the
Debtors. Moelis & Company is the financial advisor. Garden City
Group Inc. is the claims and notice agent.
Prepetition, General Maritime reached agreements with its key
senior lenders, including its bank group, led by Nordea Bank
Finland plc, New York Branch as administrative agent, as well as
affiliates of Oaktree Capital Management, L.P., on the terms of a
restructuring. Under terms of the agreements, Oaktree will
provide a $175 million new equity investment in General Maritime
and convert its prepetition secured debt to equity.
In conjunction with the filing, General Maritime has received a
commitment for up to $100 million in new DIP financing from a
group of lenders led by Nordea as administrative agent.
Counsel for Nordea, as the DIP Agent and the Senior Agent, are
Thomas E. Lauria, Esq., and Scott Greissman, Esq., at White & Case
LLP. Counsel for Oaktree Capital Management, the Junior Agent,
are Edward Sassower, Esq., and Brian Schartz, Esq., at Kirkland &
Ellis, LLP.
The Official Committee of Unsecured Creditors appointed in the
case has retained lawyers at Jones Day as Chapter 11 counsel.
Jones Day previously represented an ad hoc group of holders of the
12% Senior Notes due 2017 issued by General Maritime Corp. This
representation began Sept. 20, 2011, and concluded Nov. 29, 2011,
with the agreement of all members of the Noteholders Committee.
The Creditors Committee also tapped Lowenstein Sandler PC as
special conflicts counsel.
The Noteholders Committee consisted of Capital Research and
Management Company, J.P. Morgan Investment Management, Inc., J.P.
Morgan Securities LLC, Stone Harbor Investment Partners LP and
Third Avenue Focused Credit Fund.
The Creditors Committee is comprised of Bank of New York Mellon
Corporate Trust, Stone Harbor Investment Partners, Delos
Investment Management, and Ultramar Agencia Maritima Ltda.
GenMar filed a proposed Chapter 11 plan on Jan. 31 to implement
an agreement worked out before the Nov. 17 bankruptcy filing with
affiliates of Oaktree Capital Management LP. The Oaktree group,
lenders on three credits totaling more than $1 billion, are to
invest $175 million while converting secured debt to equity. In
addition, there is to be a $61.3 million rights offering where
creditors can purchase new stock. The Company intends to seek
confirmation of the Plan by April 2012.
GENERAL MARITIME: Modifies Plan, Asks Voting Extension to April 25
------------------------------------------------------------------
General Maritime Corporation, et al., ask the U.S. Bankruptcy
Court for the Southern District of New York to approve the
modifications to its Chapter 11 Plan as contemplated by the global
settlement.
The Debtors also seek to present the Modified Plan to creditors
for voting. The Debtors also ask that the Court authorize them to
make the modifications without the need to resolicit creditors in
the voting classes.
As reported in the March 29, 2012 edition of the TCR, the Debtors
reached an agreement with the Official Committee of Unsecured
Creditors and holders of senior unsecured notes to the proposed
Chapter 11 plan.
The Modified Plan dated March 26, 2012, provides that:
x) the Prepetition Senior Lenders will continue to provide exit
financing to the Reorganized Debtors through the refinancing of
the Prepetition Senior Facilities into the New Senior Facilities;
y) the OCM Facility Lenders and the Oaktree Plan Sponsors will
receive 98% of the Reorganized Debtors' equity on account of (i)
the OCM Facility Secured Claim (stipulated at $175 million), (ii)
the $175 million New Equity Investment, and (iii) the Commitment
Fee GMR Common Stock; and
z) holders of the Debtors' general unsecured claims against the
Guarantor Debtors, including claims arising under the $300 million
in Senior Notes, will share pro rata in (i) $6 million cash, (ii)
2% of the Reorganized Debtors' equity, and (iii) warrants to
purchase up to 3% additional equity of the Reorganized Debtors.
As a result of the Modified Plan, (i) the Debtors' financial debt
will be reduced by approximately $600 million, (ii) the Debtors'
cash interest expense will be reduced by approximately $42 million
annually, and (iii) the Debtors will receive a new capital
infusion of approximately $175 million from the Oaktree Plan
Sponsors.
A full-text copy of the Modified Disclosure Statement is available
for free at:
http://bankrupt.com/misc/GENERAL_MARITIME_plan_secondamended.pdf
In this relation, the Debtors have extended the voting deadline on
the Modified Plan from April 10, 2012, to April 25 order to
provide affected creditors with sufficient time to consider the
Plan Modifications and review the Modified Plan. The Debtors will
seek confirmation of the Modified Plan at a hearing held on May 3.
The Debtor set an April 2, hearing at 10:00 a.m. (prevailing
Eastern Time) on the approval of the plan modifications.
Objections, if any, are due March 29, at 12:00 p.m.
About General Maritime
New York-based General Maritime Corporation, through its
subsidiaries, provides international transportation services of
seaborne crude oil and petroleum products. The Company's fleet is
comprised of VLCC, Suezmax, Aframax, Panamax and product carrier
vessels. The fleet consisted of 30 owned vessels and three
chartered vessels. The company generates substantially all of its
revenues by chartering its fleet to third-party customers. The
largest customers include major international oil companies, oil
producers, and oil traders such as BP, Chevron Corporation, CITGO
Petroleum Corp., ConocoPhillips, Exxon Mobil Corporation, Hess
Corporation, Lukoil Oil Company, Stena AB, and Trafigura.
General Maritime and 56 subsidiaries filed for Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 11-15285) on Nov. 17,
2011. Douglas Mannal, Esq., and Adam C. Rogoff, Esq., at Kramer
Levin Naftalis & Frankel LLP, in New York, serve as counsel to the
Debtors. Moelis & Company is the financial advisor. Garden City
Group Inc. is the claims and notice agent.
Prepetition, General Maritime reached agreements with its key
senior lenders, including its bank group, led by Nordea Bank
Finland plc, New York Branch as administrative agent, as well as
affiliates of Oaktree Capital Management, L.P., on the terms of a
restructuring. Under terms of the agreements, Oaktree will
provide a $175 million new equity investment in General Maritime
and convert its prepetition secured debt to equity.
In conjunction with the filing, General Maritime has received a
commitment for up to $100 million in new DIP financing from a
group of lenders led by Nordea as administrative agent.
Counsel for Nordea, as the DIP Agent and the Senior Agent, are
Thomas E. Lauria, Esq., and Scott Greissman, Esq., at White & Case
LLP. Counsel for Oaktree Capital Management, the Junior Agent,
are Edward Sassower, Esq., and Brian Schartz, Esq., at Kirkland &
Ellis, LLP.
The Official Committee of Unsecured Creditors appointed in the
case has retained lawyers at Jones Day as Chapter 11 counsel.
Jones Day previously represented an ad hoc group of holders of the
12% Senior Notes due 2017 issued by General Maritime Corp. This
representation began Sept. 20, 2011, and concluded Nov. 29, 2011,
with the agreement of all members of the Noteholders Committee.
The Creditors Committee also tapped Lowenstein Sandler PC as
special conflicts counsel.
The Noteholders Committee consisted of Capital Research and
Management Company, J.P. Morgan Investment Management, Inc., J.P.
Morgan Securities LLC, Stone Harbor Investment Partners LP and
Third Avenue Focused Credit Fund.
The Creditors Committee is comprised of Bank of New York Mellon
Corporate Trust, Stone Harbor Investment Partners, Delos
Investment Management, and Ultramar Agencia Maritima Ltda.
GenMar filed a a proposed Chapter 11 plan on Jan. 31 to implement
an agreement worked out before the Nov. 17 bankruptcy filing with
affiliates of Oaktree Capital Management LP. The Oaktree group,
lenders on three credits totaling more than $1 billion, are to
invest $175 million while converting secured debt to equity. In
addition, there is to be a $61.3 million rights offering where
creditors can purchase new stock. The Company intends to seek
confirmation of the Plan by April 2012.
GENERAL MARITIME: Can Decide on NY Lease Assumption Until June 14
-----------------------------------------------------------------
The Hon. Martin Glenn of the U.S. Bankruptcy Court for the
Southern District of New York has extended, at the behest of
General Maritime Corporation, et al., the time within which the
Debtors must assume or reject unexpired leases of nonresidential
real property through and including the earlier of (i) the
effective date of a plan of reorganization, or (ii) June 14, 2012
or such later date as may be agreed to by the Debtors and the
landlord.
The Debtors' sole unexpired lease of nonresidential real property
consists of the Debtors' global headquarters located at 299 Park
Avenue, New York, New York. The Debtors utilize the Leased
Premises pursuant to a lease agreement dated as of Nov. 30, 2004,
between Debtor General Maritime Subsidiary Corporation and Fisher-
Park Lane Owner LLC, the owner of the Leased Premises.
Adam C. Rogoff, Esq., at Kramer Levin Naftalis & Frankel LLP, the
Debtors' bankruptcy counsel, said, "While this is a single
location, the Debtors need to assess whether to assume the Lease,
seek modification prior to assumption, or, as part of their Plan
process, seek to relocate their global headquarters -- a decision
for which additional time is warranted."
According to Mr. Rogoff, the Leased Premises are essential to the
Debtors' operations as the Debtors' business affairs are primarily
conducted out of the Leased Premises. The New York office is
responsible for all major corporate and operating decisions by the
Debtors, including arranging for charters of the Vessels and
monitoring fleet operations, Vessel positions, and spot market
voyage charter rates across the world. The majority of the
Debtors' non-seafaring personnel are located in the New York
office, as well as many of the Debtors' officers and directors, as
are substantially all of the books, records, and original
organizational documents for each of the Debtors. Mr. Rogoff
assured the Court that the Debtors have timely performed their
obligations under the Lease since the Petition Date, and that the
Debtors are unaware of any outstanding prepetition obligations.
About General Maritime
New York-based General Maritime Corporation, through its
subsidiaries, provides international transportation services of
seaborne crude oil and petroleum products. The Company's fleet is
comprised of VLCC, Suezmax, Aframax, Panamax and product carrier
vessels. The fleet consisted of 30 owned vessels and three
chartered vessels. The company generates substantially all of its
revenues by chartering its fleet to third-party customers. The
largest customers include major international oil companies, oil
producers, and oil traders such as BP, Chevron Corporation, CITGO
Petroleum Corp., ConocoPhillips, Exxon Mobil Corporation, Hess
Corporation, Lukoil Oil Company, Stena AB, and Trafigura.
General Maritime and 56 subsidiaries filed for Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 11-15285) on Nov. 17,
2011. Douglas Mannal, Esq., and Adam C. Rogoff, Esq., at Kramer
Levin Naftalis & Frankel LLP, in New York, serve as counsel to the
Debtors. Moelis & Company is the financial advisor. Garden City
Group Inc. is the claims and notice agent.
Prepetition, General Maritime reached agreements with its key
senior lenders, including its bank group, led by Nordea Bank
Finland plc, New York Branch as administrative agent, as well as
affiliates of Oaktree Capital Management, L.P., on the terms of a
restructuring. Under terms of the agreements, Oaktree will
provide a $175 million new equity investment in General Maritime
and convert its prepetition secured debt to equity.
In conjunction with the filing, General Maritime has received a
commitment for up to $100 million in new DIP financing from a
group of lenders led by Nordea as administrative agent.
Counsel for Nordea, as the DIP Agent and the Senior Agent, are
Thomas E. Lauria, Esq., and Scott Greissman, Esq., at White & Case
LLP. Counsel for Oaktree Capital Management, the Junior Agent,
are Edward Sassower, Esq., and Brian Schartz, Esq., at Kirkland &
Ellis, LLP.
The Official Committee of Unsecured Creditors appointed in the
case has retained lawyers at Jones Day as Chapter 11 counsel.
Jones Day previously represented an ad hoc group of holders of the
12% Senior Notes due 2017 issued by General Maritime Corp. This
representation began Sept. 20, 2011, and concluded Nov. 29, 2011,
with the agreement of all members of the Noteholders Committee.
The Creditors Committee also tapped Lowenstein Sandler PC as
special conflicts counsel.
The Noteholders Committee consisted of Capital Research and
Management Company, J.P. Morgan Investment Management, Inc., J.P.
Morgan Securities LLC, Stone Harbor Investment Partners LP and
Third Avenue Focused Credit Fund.
The Creditors Committee is comprised of Bank of New York Mellon
Corporate Trust, Stone Harbor Investment Partners, Delos
Investment Management, and Ultramar Agencia Maritima Ltda.
GenMar filed a a proposed Chapter 11 plan on Jan. 31 to implement
an agreement worked out before the Nov. 17 bankruptcy filing with
affiliates of Oaktree Capital Management LP. The Oaktree group,
lenders on three credits totaling more than $1 billion, are to
invest $175 million while converting secured debt to equity. In
addition, there is to be a $61.3 million rights offering where
creditors can purchase new stock. The Company intends to seek
confirmation of the Plan by April 2012.
GENTA INC: Completes Financing of up to $12 Million
---------------------------------------------------
Genta Incorporated entered into definitive agreements with
institutional investors in a private placement to sell Senior
Secured Convertible Notes for up to $12.0 million in aggregate
gross proceeds before fees and expenses. The transaction is
expected to close with initial gross proceeds of $2.0 million on
or about March 30, 2012, subject to satisfaction of customary
closing conditions. Proceeds of the financing will be used to
initiate late-stage, randomized clinical trials with tesetaxel in
two major oncology indications: gastric cancer and breast cancer.
Tesetaxel is the leading oral taxane in clinical development.
"We greatly appreciate the investors' continued interest and
enthusiasm for the Company's major initiatives," said Dr. Raymond
P. Warrell, Jr., Genta's Chief Executive Officer. "Gastric cancer
and breast cancer are unmet global needs, and they remain the lead
indications for registration of tesetaxel. We look forward to the
announcement of the trial initiations along with key features of
their design and objectives."
Summary of Financial Terms
The $12.0 million of Senior Secured Convertible Notes issued
pursuant to this transaction have a 10-year term, bear an annual
interest rate of 6%, payable semi-annually, and will be
convertible into shares of Genta common stock at a conversion rate
of 100,000 shares of common stock for every $100.00 of principal
that is converted. Certain provisions from prior transactions,
including a requirement that the Company implement a reverse stock
split and a conversion price reset of existing convertible notes
following such reverse stock split, will be eliminated upon the
closing of this transaction.
An initial tranche of $2.0 million in gross proceeds from this
transaction will be made immediately available to the Company.
Additional funds of up to $10.0 million may be received following
the purchase of subsequent notes, at the investor's discretion.
A copy of the Form 8-K is available for free at:
http://is.gd/eWr782
About Genta Incorporated
Berkeley Heights, New Jersey-based Genta Incorporated (OTC BB:
GNTA) -- http://www.genta.com/-- is a biopharmaceutical company
engaged in pharmaceutical (drug) research and development. The
Company is dedicated to the identification, development and
commercialization of novel drugs for the treatment of cancer and
related diseases.
The Company reported a net loss of $69.42 million in 2011,
compared with a net loss of $167.30 million during the prior year.
The Company's balance sheet at Dec. 31, 2011, showed $14.49
million in total assets, $53.74 million in total liabilities and a
$39.24 million total stockholders' deficit.
EisnerAmper LLP, in Edison, New Jersey, noted that the Company's
recurring losses from operations and negative cash flows from
operations and current maturities of convertible notes payable
raise substantial doubt about its ability to continue as a going
concern.
Bankruptcy Warning
According to the Form 10-K for the year ended Dec. 31, 2011, the
Company in September 2011, issued $12.7 million of units,
consisting of $4.2 million of senior secured convertible notes and
$8.5 million of senior secured cash collateralized convertible
notes. In connection with the sale of the units, the Company also
issued two types of debt warrants in an amount equal to 100% of
the purchase price for each unit. The Company had direct access
to $4.2 million of the proceeds, and the remaining $8.5 million of
the proceeds were placed in a blocked account as collateral
security for the $8.5 million senior secured cash collateralized
convertible notes. Presently, with no further financing, the
Company projects that it will run out of funds during the first
quarter of 2012. The Company currently does not have any
additional financing in place. If it is unable to raise
additional funds, the Company could be required to reduce its
spending plans, reduce its workforce, license one or more of its
products or technologies that it would otherwise seek to
commercialize itself, sell some or all of its assets, cease
operations or even declare bankruptcy. There can be no assurance
that the Company can obtain financing, if at all, or raise those
additional funds, on terms acceptable to it.
GOODYEAR TIRE: S&P Rates $1.2-Bil. Second Lien Term Loan 'BB'
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB' issue-level
rating to Akron, Ohio-based The Goodyear Tire & Rubber Co.'s
$1.2 billion senior secured second-lien term loan. "At the same
time, we assigned our recovery rating of '2' to the term loan,
indicating our expectation that lenders would receive substantial
recovery (70%-90%) in the event of a payment default," S&P said.
"The company is refinancing its domestic credit facilities. The
commitment under its senior secured second-lien term loan will
remain at $1.2 billion and will be extended to 2019. Its senior
secured, first-lien asset based revolving credit facility will be
increased from $1.5 billion to $2.0 billion and its maturity will
be extended to 2017. The proceeds under the amended and restated
term loan will be used to repay the existing term loan and to fund
working capital requirements and general corporate purposes of
Goodyear Tire and its subsidiaries," S&P said.
"The company's obligations under both credit facilities will be
guaranteed by each of its existing and subsequently acquired
direct or indirect domestic and Canadian subsidiaries. The second-
lien term loan will be secured by second-priority security
interests in all accounts receivable and inventory of the parent
company and its domestic and Canadian subsidiaries, a second-
priority pledge of applicable capital stock of each existing and
subsequently acquired subsidiaries of Goodyear, perfected second-
priority security interests in substantially all the other
tangible and intangible assets of the parent company and its
domestic and Canadian subsidiaries, and perfected second-priority
security interests in mortgages on certain U.S. property, plant
and equipment. The first-lien revolving facility will have a
first-priority interest or pledge in the collateral securing the
second lien term loan," S&P said.
"Our 'BB-' rating on Goodyear Tire reflects the company's high
leverage and the substantial competition in both the replacement
and original equipment tire markets," S&P said.
RATINGS LIST
The Goodyear Tire & Rubber Co.
Corporate credit rating BB-/Stable/--
New Rating
The Goodyear Tire & Rubber Co.
$1.2B sr secd second-lien term loan BB
Recovery rating 2
GIBRALTAR KENTUCKY: Taps Talarchyk Merrill as Bankruptcy Counsel
----------------------------------------------------------------
Gibraltar Kentucky Development, LLC, asks for permission from the
U.S. Bankruptcy Court for the Southern District of Florida to
employ Talarchyk Merrill, LLC, as bankruptcy counsel, nunc pro
tunc to Feb. 10, 2012.
Talarchyk Merrill's hourly rates for its professionals and para-
professionals range between $425 to $500 for partners, $150 to
$250 for associates, and $95 to $125 for legal assistants.
Before the Petition Date, the Debtor retained Talarchyk Merrill to
represent it in connection with its present efforts to restructure
their businesses. On Jan. 30, 2012, in accordance with Talarchyk
Merrill's engagement by the Debtor before the Petition Date,
Talarchyk Merrill requested and received a retainer in the amount
of $15,000 for professional services rendered and to be rendered
and charges and disbursements incurred by Talarchyk Merrill in
connection with the services.
Tina M. Talarchyk, a partner at Talarchyk Merrill, attests that
the firm is a "disinterested person" within the meaning of section
101(14) of the Bankruptcy Code; and does not hold or represent an
interest adverse to the Debtors' estates in connection with any
matter on which GCG will be employed.
The Court has set a hearing for April 12, 2012, on the Debtor's
motion to employ Talarchyk Merrill as bankruptcy counsel.
About Gibraltar Kentucky Development
Gibraltar Kentucky Development, LLC, filed a Chapter 11 bankruptcy
petition (Bankr. S.D. Fla. Case No. 12-13289) on Feb. 10, 2012, in
West Palm Beach, Florida. In its schedules, Palm Beach Gardens-
based Gibraltar Kentucky disclosed $175,395,449 in total assets
and $1,193,516 in total liabilities. It says that it is not a
small business debtor under 11 U.S.C. Sec. 101(51D). Documents
attached to the petition indicate that McCaugh Energy LLC owns
42.15% of the "fee simple" securities.
According to the Web site http://www.gibraltarenergygroup.com/
Gibraltar Kentucky is part of the Gibraltar Energy Group. The
various companies of the group are involved with the drilling,
development and production of oil and gas, as well as, the sale of
coal and timber. Offices are in Michigan and Florida and
investments are in Michigan and Kentucky.
Judge Erik P. Kimball presides over the case.
GIBRALTAR KENTUCKY: US Trustee Has Not Appointed Creditors' Panel
-----------------------------------------------------------------
Steven R. Turner, Trustee for Region 21, has informed the U.S.
Bankruptcy Court for the Southern District of Florida that, until
further notice, he will not appoint a committee of creditors for
Gibraltar Kentucky Development, LLC's Chapter 11 case.
About Gibraltar Kentucky Development
Gibraltar Kentucky Development, LLC, filed a Chapter 11 bankruptcy
petition (Bankr. S.D. Fla. Case No. 12-13289) on Feb. 10, 2012, in
West Palm Beach, Florida. In its schedules, Palm Beach Gardens-
based Gibraltar Kentucky disclosed $175,395,449 in total assets
and $1,193,516 in total liabilities. It says that it is not a
small business debtor under 11 U.S.C. Sec. 101(51D). Documents
attached to the petition indicate that McCaugh Energy LLC owns
42.15% of the "fee simple" securities.
According to the Web site http://www.gibraltarenergygroup.com/
Gibraltar Kentucky is part of the Gibraltar Energy Group. The
various companies of the group are involved with the drilling,
development and production of oil and gas, as well as, the sale of
coal and timber. Offices are in Michigan and Florida and
investments are in Michigan and Kentucky.
Judge Erik P. Kimball presides over the case. David L. Merrill,
Esq., at Talarchyk Merrill, LLC, serves as the Debtor's counsel.
The petition was signed by Bill Boyd, as manager.
GIBRALTAR KENTUCKY: Files Schedules of Assets and Liabilities
-------------------------------------------------------------
Gibraltar Kentucky Development, LLC, filed with the Bankruptcy
Court for the Southern District of Florida its schedules of assets
and liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $100,000
B. Personal Property $175,295,449
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $0
E. Creditors Holding
Unsecured Priority
Claims $4,036
F. Creditors Holding
Unsecured Non-priority
Claims $1,189,480
----------- -----------
TOTAL $175,395,449 $1,193,516
A copy of the schedules is available for free at:
http://bankrupt.com/misc/GIBRALTAR_KENTUCKY_sal.pdf
About Gibraltar Kentucky Development
Gibraltar Kentucky Development, LLC, filed a Chapter 11 bankruptcy
petition (Bankr. S.D. Fla. Case No. 12-13289) on Feb. 10, 2012, in
West Palm Beach, Florida. Palm Beach Gardens-based Gibraltar
Kentucky says that it is not a small business debtor under 11
U.S.C. Sec. 101(51D). Documents attached to the petition indicate
that McCaugh Energy LLC owns 42.15% of the "fee simple"
securities.
According to the Web site http://www.gibraltarenergygroup.com/
Gibraltar Kentucky is part of the Gibraltar Energy Group. The
various companies of the group are involved with the drilling,
development and production of oil and gas, as well as, the sale of
coal and timber. Offices are in Michigan and Florida and
investments are in Michigan and Kentucky.
Judge Erik P. Kimball presides over the case. David L. Merrill,
Esq., at Talarchyk Merrill, LLC, serves as the Debtor's counsel.
The petition was signed by Bill Boyd, as manager.
GRAND AVENUE: Case Summary & 9 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Grand Avenue Land Partners, LLC
Pence & MacMillan, LLC
Attn: Greg Weisz
501 Garfield Street
Laramie, WY 82073-1285
Bankruptcy Case No.: 12-20265
Chapter 11 Petition Date: March 28, 2012
Court: United States Bankruptcy Court
District of Wyoming (Cheyenne)
Judge: Peter J. McNiff
Debtor's Counsel: Ken McCartney, Esq.
THE LAW OFFICES OF KEN MCCARTNEY, P.C.
P.O. Box 1364
Cheyenne, WY 82003
Tel: (307) 635-0555
Fax: (307) 635-0585
E-mail: bnkrpcyrep@aol.com
Scheduled Assets: $8,323,089
Scheduled Liabilities: $6,532,016
A copy of the list of nine largest unsecured creditors is
available for free at http://bankrupt.com/misc/wyb12-20265.pdf
The petition was signed by Fred L. Croci, president of Wolverine
Management Group, Inc., managing member.
GREEN ENDEAVORS: Delays Form 10-K for 2011 Due to CFO's Departure
-----------------------------------------------------------------
Green Endeavors, Inc., was unable to timely complete the
preparation of the annual report for the year ended Dec. 31, 2011,
as a result of the resignation of its CFO during the fourth
quarter of 2011, the subsequent failure of a computer system in
February of 2012 that delayed the gathering of final financial
reports necessary to the compilation of the financial records for
the year 2011.
About Green Endeavors
Salt Lake City, Utah-based Green Endeavors, Inc., runs two hair
care salons that feature Aveda(TM) products for retail sale.
The Company also reported a net loss of $112,799 on $2.05 million
of total revenue for the nine months ended Sept. 30, 2011,
compared with a net loss of $187,586 on $1.60 million of total
revenue for the same period a year ago.
The Company's balance sheet at Sept. 30, 2011, showed
$1.06 million in total assets, $4.37 million in total liabilities
and a $3.31 million total stockholders' deficit.
Green had a net loss for the nine months ended Sept. 30, 2011, of
$112,799 and negative working capital of $1,209,264, which raises
substantial doubt about the Green's ability to continue as a going
concern. Green's ability to continue as a going concern is
contingent upon the successful completion of additional financing
arrangements and its ability to successfully fulfill its business
plan. Management plans to attempt to raise additional funds to
finance the operating and capital requirements of Green through a
combination of equity and debt financings. While Green is making
its best efforts to achieve the above plans, there is no assurance
that any such activity will generate funds that will be sufficient
for operations.
As reported by the TCR on April 1, 2011, Madsen & Associates CPA',
Inc., in Salt Lake City, Utah, expressed substantial doubt about
the Company's ability to continue as a going concern. The
accountants noted that the Company will need additional working
capital for its planned activity and to service its debt.
GUANGZHOU GLOBAL: Delays Filing of 2011 Report
----------------------------------------------
China Teletech Holding, Inc., formerly known as Guangzhou Global
Telecom, Inc., was unable, without unreasonable effort or expense,
to file its annual report on Form 10-K for the year ended
Dec. 31, 2011, by the March 30, 2012, filing date applicable to
smaller reporting companies due to a delay experienced by the
Company in completing its financial statements and other
disclosures in the Annual Report. As a result, the Company is
still in the process of compiling required information to complete
the Annual Report and its independent registered public accounting
firm requires additional time to complete its review of the
financial statements for the year ended Dec. 31, 2011, to be
incorporated in the Annual Report. The Company anticipates that
it will file the Annual Report no later than the fifteenth
calendar day following the prescribed filing date.
About Guangzhou Global
Tallahassee, Fl.-based Guangzhou Global Telecom, Inc., was
incorporated as Avalon Development Enterprises, Inc., on March 29,
1999, under the laws of the State of Florida. The Company,
through its subsidiaries, is now principally engaged in the
distribution and trading of rechargeable phone cards, cellular
phones and accessories within cities in the People's Republic of
China.
The Company's balance sheet at Sept. 30, 2011, showed US$2.61
million in total assets, US$5.29 million in total liabilities and
a US$2.67 million total stockholders' deficit.
The Company reported a net loss of US$2.28 million on US$34.18
million of sales for the year ended Dec. 31, 2010, compared with a
net loss of US$2.82 million on US$30.48 million of sales during
the prior year.
Samuel H. Wong & Co., LLP, in n Mateo, Calif., noted in its report
on the Company's 2010 financial results that the Company has
incurred substantial losses, and has difficulty to pay the
People's Republic of China government Value Added Tax and past due
Debenture Holders Settlement, all of which raise substantial doubt
about its ability to continue as a going concern.
HALO COMPANIES: Incurs $2.5 Million Net Loss in 2011
----------------------------------------------------
Halo Companies, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss of
$2.50 million on $6.28 million of revenue in 2011, compared with a
net loss of $3.63 million on $6.86 million of revenue in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $1.63 million
in total assets, $4.32 million in total liabilities, and a
$2.69 million total shareholders' deficit.
Montgomery Coscia Greilich LLP, in Plano, Texas, expressed
substantial doubt about the ability of the Company to continue as
a going concern. The independent auditors noted that Halo
Companies, Inc., has incurred losses since its inception and has
not yet established profitable operations.
A copy of the Form 10-K is available for free at:
http://is.gd/itCb5y
About Halo Companies
Allen, Texas-based Halo Companies, Inc., is a nationwide real
estate investment, asset management and financial services company
that provides technology and asset management solutions to asset
owners as well as real estate and financial services to
financially distressed consumers which can be applied individually
or utilized as a comprehensive workout strategy.
INNOVATIVE FOOD: Swings to $1.5 Million Profit in 2011
------------------------------------------------------
Innovative Food Holdings, Inc., filed with the U.S. Securities and
Exchange Commission its annual report on Form 10-K disclosing net
income of $1.49 million on $11.55 million of revenue in 2011,
compared with a net loss of $2.11 million on $9.86 million of
revenue in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $1.42 million
in total assets, $4.79 million in total liabilities, all current,
and a $3.37 million total stockholders' deficiency.
For 2011, RBSM LLP, in New York, expressed substantial doubt about
the Company's ability to continue as a going concern. The
independent auditors noted that the Company has incurred
significant losses from operations since its inception and has a
working capital deficiency.
A copy of the Form 10-K is available for free at:
http://is.gd/DR4YlS
About Innovative Food
Naples, Fla.-based Innovative Food Holdings, Inc., through its
subsidiaries, provides perishables and specialty food products to
the wholesale foodservice industry.
HAWKER BEECHCRAFT: To File for Chapter 11 Bankruptcy Protection
---------------------------------------------------------------
The New York Times' DealBook reports that Hawker Beechcraft is
readying a bankruptcy filing, people briefed on the matter said on
Wednesday, dealing a blow to its private equity owners, Goldman
Sachs and Onex Partners.
According to the report, Hawker, which is based in Wichita,
Kansas, said it had obtained $120 million in additional loans to
buy it time to fix its balance sheet. In exchange, a majority of
the company's debt holders agreed to defer some interest payments
and grant relief from loan covenants.
The report relates one of the options Hawker and its advisers are
considering is a prearranged Chapter 11 filing that has the
consent of those lenders, principally a number of hedge funds,
said these people, who spoke on condition of anonymity. Among
them are the hedge funds Centerbridge Partners and Angelo Gordon.
The report notes a Hawker bankruptcy would be put an end to a 2007
private equity deal that was troubled almost from the start. The
company was formed when Goldman and Onex, the largest private
equity firm in Canada, bought Raytheon's private jet unit for $3.3
billion, hoping to seize on the fervor for private jets.
The report says Hawker hit rough times soon afterward, as a
recession wiped out many discretionary expenditures like private
jets. The company laid off about 2,500 employees, and lost
billions of dollars as customers like NetJets canceled orders for
new aircraft. Within two years of the leveraged buyout, Goldman's
buyout arm told investors that it had written down the value of
the company by 85%.
As of Sept. 30, Hawker had more than $2 billion in long-term debt
and $146.7 million in cash and short-term investments. It posted
an $88.6 million loss for the third quarter of last year, its
seventh in a row as its revenue slid to $518.8 million, according
to the report.
The report says Hawker has made several efforts to fix its
business, including by hiring the boutique investment bank Perella
Weinberg Partners and the law firm Kirkland & Ellis. Last month,
Hawker named Robert S. Miller, the former head of Delphi
Automotive and a restructuring specialist, as its chief executive.
The report adds a bankruptcy filing by Hawker would be another
loss for Goldman's buyout arm, which is contending with a number
of troubled investments. Chief among them is Energy Future
Holdings, the Texas utility giant formerly known as TXU, whose
value has plummeted along with the price of natural gas.
Goldman's real estate private equity funds have also struggled.
About Hawker Beechcraft
Hawker Beechcraft Acquisition Company, LLC, headquartered in
Wichita, Kan., is a manufacturer of business jets, turboprops and
piston aircraft for corporations, governments and individuals
worldwide.
The Company's balance sheet at June 30, 2011, showed $3.01 billion
in total assets, $3.33 billion in total liabilities and a $317.30
million in total deficit.
Hawker Beechcraft reported a net loss of $304.3 million on $2.80
billion of total sales for 12 months ended Dec. 31, 2010. Net
loss in 2009 and 2008 was $451.3 million and $157.2 million,
respectively.
To reduce the cost of operations, in October 2010, the Company
announced it would implement a cost reduction and productivity
program. The first part of the program consisted of the immediate
termination of approximately 8% of salaried employees while the
second part involves reducing the Company's factory and shop work
forces by approximately 800 employees by end of August 2011.
* * *
Hawker Beechcraft carries 'Caa2' corporate family and probability
of default ratings from Moody's Investors Service.
HD SUPPLY: S&P Keeps 'B' Corp. Credit Rating; Outlook Stable
------------------------------------------------------------
Standard & Poor's Ratings Services is assigning issue and recovery
ratings to HD Supply Inc.'s proposed refinancing, which includes
several new offerings that the company will use to repay certain
existing debt and extend maturities.
Specifically S&P is assigning its:
* 'BB-' issue rating and '1' recovery rating to HD Supply's
proposed $1.5 billion ABL credit facility due March 2017. The
'1' recovery rating indicates very high (90%-100%) recovery in
the event of a default.
* 'B+' issue rating and '2' recovery rating to HD Supply's
proposed $925 million term loan B due September 2017. The '2'
recovery rating indicates substantial (70%-90%) recovery in the
event of a default.
* 'B+' issue rating and '2' recovery rating to HD Supply's
proposed $925 million first-lien notes due in 2019. The '2'
recovery rating indicates substantial (70%-90%) recovery in the
event of a default.
* 'CCC+' issue rating and '6' recovery rating to HD Supply's
proposed $775 million second-lien notes due in 2020. The '6'
recovery rating indicates negligible (0-10%) recovery in the
event of a default.
* 'CCC+' issue rating and '6' recovery rating to HD Supply's
proposed $750 million senior unsecured notes due in 2020. The
'6' recovery rating indicates negligible (0-10%) recovery in
the event of a default.
"The company expects that each of these instruments will have a
springing maturity in the event that HD Supply doesn't refinance
at least 75% of its existing subordinated notes before they come
due in 2015. The springing maturities range from 45 days to 91
days prior to the subordinated notes' maturity," S&P said.
"The proposed refinancing does not affect our existing ratings on
HD Supply, including the 'B' corporate credit rating. HD Supply is
a leading industrial distributor of infrastructure and energy,
maintenance, repair and improvement, and specialty construction
products. We assess the company's financial risk profile as
'highly leveraged.' Although the refinancing will leave total debt
outstanding unchanged, the capital structure will still have more
than $5 billion of funded debt," S&P said.
"We view liquidity as adequate pro forma for the proposed capital
structure. Under the existing capital structure, the company has
no significant debt due before 2014, and the new transactions
should extend maturities out further," S&P said.
"We assess the company as having a 'satisfactory' business risk
profile, characterized by its business-line diversity, leading
market positions, and operational scale to weather the
construction downturn. The severe and protracted downturn in U.S.
construction activity strained HD Supply's operating performance
in previous years. Although we remain uncertain about the ultimate
depth and duration of the construction cycle's decline, HD Supply
has increased its share of sales in the maintenance, repair, and
operations (MRO) and infrastructure markets and reduced the impact
of the weak construction markets on its operating performance for
the next one to two years," S&P said.
"The stable long-term rating outlook reflects the improvement in
HD Supply's operations, including a 10% increase in sales in its
fiscal year ended January 2012, and a 25% increase in EBITDA,
following good sequential performance through the fiscal year,
despite still-weak end markets. Although we expect certain end
markets, including construction, to remain weak, HD Supply has
improved its operations and we expect further modest improvement
in operations as the company maintains adequate liquidity," S&P
said.
RATINGS LIST
HD Supply Inc.
Corporate credit rating B/Stable/--
Ratings Assigned
$1.5 bil. ABL revolver due 2017 BB-
Recovery rating 1
$925 mil. term loan due 2017 B+
Recovery rating 2
$925 mil. sr sec first-lien notes due 2019 B+
Recovery rating 2
$775 mil. sr sec second-lien notes due 2020 CCC+
Recovery rating 6
$750 mil. sr unsec notes due 2020 CCC+
Recovery rating 6
INDUSTRIAL FIREDOOR: Meeting to Form Creditors' Panel on April 5
----------------------------------------------------------------
Roberta A. DeAngelis, United States Trustee for Region 3, will
hold an organizational meeting on April 5, 2012, at 11:00 p.m. in
the bankruptcy case of Industrial Firedoor & Hardware Supply. The
meeting will be held at:
United States Trustee's Office
One Newark Center
1085 Raymond Blvd.
21st Floor, Room 2106
Newark, NJ 07102
The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtors' cases.
The organizational meeting is not the meeting of creditors
pursuant to Section 341 of the Bankruptcy Code. A representative
of the Debtor, however, may attend the Organizational Meeting, and
provide background information regarding the bankruptcy cases.
To increase participation in the Chapter 11 proceeding, Section
1102 of the Bankruptcy Code requires that the United States
Trustee appoint a committee of unsecured creditors as soon as
practicable. The Committee ordinarily consists of the persons,
willing to serve, that hold the seven largest unsecured claims
against the debtor of the kinds represented on the committee.
Section 1103 of the Bankruptcy Code provides that the Committee
may consult with the debtor, investigate the debtor and its
business operations and participate in the formulation of a plan
of reorganization. The Committee may also perform other services
as are in the interests of the unsecured creditors whom it
represents.
Industrial Firedoor & Hardware Supply, Inc. filed a Chapter 11
petition (Bankr. D. N.J. Case No. 12-16471) on March 13, 2012 in
Newark, New Jersey. Robert A. Drexel, Esq., at Robert A. Drexel,
in Newark, serves as counsel to the Debtor. The Debtor disclosed
$293,239 in assets and $1,011,957 in liabilities.
INTEGRATED ENVIRONMENTAL: Incurs $2.2 Million Net Loss in 2011
--------------------------------------------------------------
Integrated Environmental Technologies, Ltd., filed with the U.S.
Securities and Exchange Commission its annual report on Form 10-K
disclosing a net loss of $2.22 million on $403,554 of revenue in
2011, compared with a net loss of $2.17 million on $836,746 of
revenue in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $696,895 in
total assets, $1.48 million in total liabilities and a $790,981
total stockholders' deficiency.
For 2011, 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 also has no lending relationships with commercial
banks and is dependent on the completion of financings in order to
continue operations.
A copy of the Form 10-K is available for free at:
http://is.gd/LSsdO7
About Integrated Environmental
Little River, S.C.-based Integrated Environmental Technologies,
Ltd., through its wholly-owned subsidiary I.E.T., Inc., designs,
manufactures, and sells EcaFlo(R) equipment, which utilizes the
Electro-Chemical Activation process to generate environmentally
responsible EcaFlo(R) solutions - anolyte and catholyte - for use
in managing and controlling bacteria, fungi, viruses and other
unwanted microorganisms in an effective and economically
beneficial manner over a variety of commercial and industrial
applications.
INTERNAL FIXATION: Delays Form 10-K for 2011
--------------------------------------------
Internal Fixation Systems, Inc.'s annual report on Form 10-K for
the year ended Dec. 31, 2011, could not be filed without
unreasonable effort or expense within the prescribed time period
because management and the Company's auditor require additional
time to compile and verify the data required to be included in the
report. The Company expects to file the Form 10-K within the time
period permitted by Rule 12b-25.
About Internal Fixation
South Miami, Fla.-based Internal Fixation Systems, Inc., is a
manufacturer and marketer of generically priced orthopedic and
podiatric implants. Customers include ambulatory surgery centers,
hospitals and orthopedic surgeons. IFS's strategy is to focus on
commonly used implants that no longer have patent protection. The
Company enhances the implants and sells them at prices below the
market leaders.
Goldstein Schechter Koch P.A., in Hollywood, Florida, expressed
substantial doubt about Internal Fixation Systems' ability to
continue as a going concern, following the Company's 2010 results.
The independent auditors noted that the Company had a net loss of
$781,440 for the year ended Dec, 31, 2010, cumulative losses since
inception of $757,218 and a working capital deficit of $123,409.
The Company also reported a net loss of $1.69 million on $185,669
of net sales for the nine months ended Sept. 30, 2011, compared
with a net loss of $375,478 on $89,537 of net sales for the same
period during the prior year.
The Company's balance sheet at Sept. 30, 2011, showed $1.54
million in total assets, $1.24 million in total liabilities and
$302,043 in total stockholders' equity.
INTERNATIONAL FUEL: Incurs $2.5 Million Net Loss in 2011
--------------------------------------------------------
International Fuel Technology, Inc., filed with the U.S.
Securities and Exchange Commission its annual report on Form 10-K
disclosing a net loss of $2.57 million on $236,427 of net revenues
in 2011, compared with a net loss of $2.21 million on $298,366 of
net revenues in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $2.70 million
in total assets, $4.23 million in total liabilities, and a
$1.52 million total stockholders' deficit.
BDO USA, LLP, in Chicago, Illinois, noted that the Company has
suffered recurring losses from operations, has working capital and
stockholders' deficits at Dec. 31, 2011, and has cash obligations
and outflows from operating activities that raise substantial
doubt about its ability to continue as a going concern.
A copy of the Form 10-K is available for free at:
http://is.gd/5xzDOx
About International Fuel
St. Louis, Mo.-based International Fuel Technology, Inc., is a
technology company that has developed a range of liquid fuel
additive formulations that enhance the performance of petroleum-
based fuels and renewable liquid fuels.
IPS CORP: S&P Cuts Corp. Credit Rating to 'B-' on Refinancing Risk
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Compton, Calif.-based IPS Corp. to 'B-' from 'B'. The
outlook is negative.
"At the same time, we lowered the issue-level ratings on the
company's senior secured bank facilities to 'B+' (two notches
higher than the corporate credit rating) from 'BB-'. The recovery
rating remains '1', indicating our expectation of very high (90%
to 100%) recovery in the event of payment default. We also lowered
the issue-level ratings on the company's senior subordinated notes
to 'CCC+' (one notch lower than the corporate credit rating) from
'B-'. The recovery rating remains '5', indicating our expectation
of modest (10% to 30%) recovery in the event of payment default,"
S&P said.
"We also removed all ratings from CreditWatch, where they were
placed with negative implications on Dec. 19, 2011," S&P said.
"The downgrade reflects our view that IPS remains highly
leveraged, with significant maturities within the next few years,"
said Standard & Poor's credit analyst Megan Johnston. "The
company's $20 million revolving credit facility matures in July
2012, its term loan matures in July 2013, and its subordinated
notes mature in June 2014. In addition, dividends on the company's
paid-in-kind (PIK) preferred stock, which have been accruing at 5%
per quarter, become payable in cash in December 2014. If not
addressed in the near term, these issues could cause us to
reconsider our 'adequate' liquidity assessment."
"IPS' adhesive products constitute approximately 60% of total
revenues, with remaining revenues derived from plumbing hardware
products such as washer and icemaker supply boxes, air-admittance
valves and under-sink covers, as well as structural adhesives
products for the marine and transportation markets," S&P said.
"The rating outlook is negative, reflecting IPS Corp.'s mounting
refinancing risk in calendar years 2013 and 2014. If the company
does not begin to address these maturities within the coming
months, we could revise our liquidity assessment to 'weak.' This,
in turn, would trigger a downgrade. Although unlikely in the near
term, we could raise the ratings if the company is able to improve
its operating performance while also addressing its upcoming debt
maturities and improving its liquidity position," S&P said.
JAMAICA DIVERSIFIED: Fitch Holds Rating on 2 Note Classes at 'BB'
-----------------------------------------------------------------
Fitch Ratings has taken the following rating actions on the notes
issued by Jamaica Diversified Payment Rights Company:
-- Series 2006-1 Notes due 2013 affirmed at 'BB'; Outlook
Stable;
-- Series 2007-1 Notes due 2015 affirmed at 'BB'; Outlook
Stable.
The transaction is a securitization of existing and future U.S.
dollar-denominated diversified payment rights (DPRs) originated by
National Commercial Bank Jamaica Ltd.'s (NCBJ). DPRs refer to
electronic payment orders intended for payment to third party
beneficiaries via NCBJ, related to international trade financed by
NCBJ, export remittances, workers remittances, and foreign direct
investment. Upon generation of the payment orders, the trust will
have rights to the DPRs through accounts maintained with
designated depositary banks (DDBs). On average, over 97% of all
collections currently come via DDB transactions.
These structures mitigate certain sovereign- and bank-related
risks associated with Jamaica and NCBJ, allowing the rating of the
securitization to be above Jamaica's country ceiling of 'B' and
NCBJ's foreign currency (FC) and local currency (LC) issuer
default ratings (IDRs) of 'B-'.
In March 2012, Fitch affirmed NCBJ's FC and LC IDRs at 'B-'
with a Stable Outlook. A strong domestic franchise, solid
profitability, and adequate capitalization support the current
ratings of NCBJ. Nevertheless, NCBJ's ratings remain constrained
by the sovereign's weak credit profile given high exposure to the
Jamaican public sector, lending concentrations, as well as a
challenging operating environment.
The rating actions on the notes reflect the recent affirmation of
NCBJ's FC and LC IDRs, the stability of the bank's DPR flows and
the relatively high coverage levels. Quarterly coverage levels
for the program during 2011 averaged approximately 72 times (x)
maximum quarterly debt service. As of February 2012, current
monthly debt service coverage ratio (DSCR) is 63.1x and quarterly
DSCR is 76.07x. The proportion of collections from DDB remains
considerably over the 70% trigger and all other early amortization
trigger tests are passed comfortably.
JAMES D. CLYMER: Court Declines to Issue Final Decree
-----------------------------------------------------
Bankruptcy Judge Russ Kendig denied the request of James D. Clymer
and Kathy J. Clymer for a final decree closing their Chapter 11
case. "Based on the record before the court, and the specific
terms of the plan, it appears unlikely that payments under
Debtors' chapter 11 plan are complete and Debtors have provided no
evidence to the contrary. Debtors' confirmed plan does not
provide for a discharge prior to completion and Debtors have not
established cause for entry of the discharge before completion of
payments. Consequently, the court denies Debtors' motion for
final decree and entry of the discharge at this stage of the case.
This decision is without prejudice to renewal of the request under
more appropriate circumstances," Judge Kendig said in a March 28,
2012 Memorandum of Opinion available at http://is.gd/IZw4OLfrom
Leagle.com.
The Debtors filed a motion for a final decree and requested entry
of a discharge in the case on Dec. 30, 2011. No objections were
filed.
James D. Clymer and Kathy J. Clymer, fdba Clymer Insurance Agency,
in Orrville, Ohio, filed for Chapter 11 bankruptcy (Bankr. N.D.
Ohio Case No. 10-63352) on Aug. 3, 2010. Judge Russ Kendig
oversees the case. David A. Mucklow, Esq. --
davidamucklow@yahoo.com -- serves as the Debtors' counsel. In
their joint Chapter 11 petition, the Debtors scheduled $519,835 in
assets and $1,007,105 in debts.
The Debtors filed a joint chapter 11 petition on Aug. 30, 2010.
Their proposed plan of reorganization was confirmed on Sept. 12,
2011.
JAMES QUINLAN: Court Wants Changes to Plan Outline
--------------------------------------------------
Bankruptcy Judge Thomas J. Tucker directed James Bonnell Quinlan
and Margaret Ann Loomis to make changes to the First Amended
Combined Plan and Disclosure Statement filed March 21. The Court
cited problems in the disclosure statement that the Debtors must
correct. The amendments were due to be filed by March 28, 2012.
A copy of the Court's March 25, 2012 Order is available at
http://is.gd/POxSngfrom Leagle.com.
James Bonnell Quinlan and Margaret Ann Loomis filed for Chapter 11
bankruptcy (Bankr. E.D. Mich. Case No. 11-64276) on Sept. 13,
2011.
JIM PALMER: Chapter 7 Trustee Settles Lawsuit Over Sale
-------------------------------------------------------
Bankruptcy Judge Ralph B. Kirscher granted the motion of Darcy M.
Crum, the Chapter 7 trustee in the bankruptcy case of James V.
Palmer, for approval of a compromise settlement in the adversary
proceeding, Darcy M. Crum, v. James V. Palmer, Jim Palmer
Trucking, Blazo Gjorev, Milan Kangrga, John Does 1-10, and XYZ
Corp. 1-10, Adv. Proc. No. 11-00001 (Bankr. D. Mont.). The Court
overruled objections by Navistar Financial Corporation and
Navistar Leasing Company.
The complaint alleges that Mr. Palmer sold JPT and related
companies to Messrs. Gjorev and Kangrga for less than the
companies' value in anticipation of filing bankruptcy, and that
the employment agreement was an attempt by the Defendants to evade
bankruptcy law and compensate Mr. Palmer without having to claim
assets in his personal bankruptcy.
Mr. Palmer owned Jim Palmer Trucking and other related business
entities known as Jim Palmer Equipment, Inc., Jim Palmer Equipment
II, L.L.C., and Jim Palmer Equipment Logistics, LLC. Messrs.
Gjorev and Kangrga purchased Mr. Palmer's stock in JPT and the
other related business entities. Joe Kalafat, president and CEO
of JPT, testified that Messrs. Gjorev and Kangrga bought Mr.
Palmer's stock "technically" because the stock had no value unless
the owner was running the company. After the purchase JPT and Mr.
Palmer entered into an employment agreement, dated Feb. 10, 2010.
Mr. Palmer was to be employed as an "ambassador" for JPT for a
term of 10 years at compensation set at $200,000 annually in equal
monthly payments.
Mr. Palmer had no more specific duties than he had been performing
before the sale. He eventually failed to fulfill his duties and
JPT terminated his employment. Mr. Palmer initiated wrongful
termination litigation against JPT.
JPT and Mr. Palmer settled the litigation with an agreement signed
Dec. 6, 2010, which provided for payment to Mr. Palmer of a
settlement in the amount of $450,000 payable in the amount of
$50,000 per year in bi-weekly payments, and mutual releases. The
payments were not secured.
Mr. Palmer filed a voluntary Chapter 7 bankruptcy petition (Bankr.
D. Mont. No. 10-60099-7) on Jan. 22, 2010. Ms. Crum was appointed
as trustee on Feb. 4, 2010. She employed Trent M. Gardner and his
law firm Goetz, Gallik & Baldwin, P.C., as attorney for the estate
to prosecute the adversary proceeding on a contingency fee basis,
plus costs. The main case remains open pending the adversary
proceeding, and the Chapter 7 Trustee has administered all other
assets.
Pursuant to the settlement agreement, the parties agree to resolve
and release all claims made or that could have been made by Ms.
Crum against the Defendants in exchange for payment of $100,000 by
March 6, 2012. The parties arrived at the $100,000 settlement
amount based on the mediation and what the parties were able to
pay. Mr. Kalafat testified that JPT's trucking cash flow would be
the sole source of the $100,000 payment, except there "might be a
few dollars" from elsewhere. He testified that Ms. Crum did not
demand payment of the $100,000 from JPT alone and not from any
other party.
Navistar objects to the proposed settlement, saying it punishes
Navistar and creditors under other confirmed chapter 11 plans by
depleting those debtors of cash while the Chapter 7 Trustee and
her professionals earn fees and creditors in this Chapter 11 case
receive the distribution, and the alleged wrongdoers pay nothing
and get a release. Navistar objects that the Chapter 7 Trustee
failed to show difficulty of collection from the alleged
wrongdoers, Messrs. Gjorev and Kangrga, who are not contributing
anything. Navistar also contends that the Court may look beyond
the benefit to the estate and consider the impact on the rights of
third parties.
A copy of the Court's March 26, 2012 Memorandum of Decision is
available at http://is.gd/pWYbe2from Leagle.com.
About Jim Palmer Trucking
Headquartered in Missoula, Montana, Jim Palmer Trucking Inc. --
http://www.jimpalmertrucking.com/-- offers truckload
transportation of temperature-controlled cargo. The company
operates throughout the US from terminals in Missoula, Montana;
Salina, Kansas; and Tampa. The Debtor and two of its affiliates
filed for separate Chapter 11 protection on July 15, 2008, (Bankr.
D. Mont. Lead Case No. 08-60922). The Debtors listed $11,897,554
in total assets and $12,089,808 in total debts.
Judge Ralph B. Kirscher presided over the case. James A. Patten,
Esq. -- japatten@ppbglaw.com -- at Patten Peterman Bekkedahl &
Green, served as the Debtors' counsel. On May 8, 2009, the Court
entered orders confirming Chapter 11 reorganization plans for the
Palmer entities. In particular, the Court confirmed the Amended
Chapter 11 Plan of Reorganization of Jim Palmer Equipment II LLC.
The Court also confirmed the Third Amended Chapter 11 Plan of
Reorganization of Jim Palmer Trucking. The Court confirmed the
Third Amended Chapter 11 Plan of Reorganization of Jim Palmer
Equipment, Inc. The Palmer entities' bankruptcy cases were closed
in July 2010.
LEVEL 3: Fitch Upgrades Issuer Default Rating to 'B'
----------------------------------------------------
Fitch Ratings has published a company report on Level 3
Communications, Inc., the latest in Fitch's recurring 'Spotlight
Series' of leveraged finance reports.
Fitch upgraded Level-3 Communications' Issuer Default Rating to
'B' from 'B-' on Oct. 4, 2011 and assigned a Positive Outlook.
The rating action followed LVLT's announcement that the company
closed on its previously announced agreement to acquire Global
Crossing Limited (GLBC) in a tax-free, stock-for-stock
transaction.
Fitch's Spotlight Series of company reports provide in-depth
credit analysis on a high-profile U.S. leveraged issuer with a
significant amount of debt and/or complex capital structure. In
addition to the operating, liquidity and financial analysis, the
report also provides:
-- Capital Structure analysis with debt diagrams;
-- Recovery Analysis;
-- Detailed debt document summaries;
-- Industry Outlook and Competitive Risk assessment; and
-- Summary of Corporate Governance Issues.
Previous Spotlight Series reports include:
-- MGM Resorts International (Feb 2, 2012)
-- Energy Future Holdings Corp. (Oct. 27, 2011)
-- Del Monte Corporation (November 17, 2011)
-- Sprint Nextel Corp. Spotlight (Oct. 26, 2011)
-- HCA, Inc. (Oct. 11, 2011)
-- Toys 'R' Us, Inc. (Sept. 29, 2011)
Upcoming Spotlight Series reports include:
-- Nielsen Company B.V.
-- First Data Corporation
-- Dean Foods Company
-- Clear Channel Communications, Inc.
-- Calpine Corporation
LPATH INC: Amends Form S-1; To Offer 12.5 Million Units
-------------------------------------------------------
Lpath, Inc., filed with the U.S. Securities and Exchange
Commission Amendment No. 2 to Form S-1 relating to the offering of
up to 12,500,000 Units, with each Unit consisting of one share of
our common stock and 0.5 of a warrant to purchase one share of the
Company's.
The proposed maximum aggregate offering price is $17.05 million.
The Company's Class A common stock is traded on the OTC Bulletin
Board under the symbol "LPTN." On Feb. 8, 2012, the closing sale
price of the Company's Class A common stock on the OTC Bulletin
Board was $1.01 per share. The Company does not intend to list
the warrants on any exchange or other trading system.
A copy of the amended prospectus is available for free at:
http://is.gd/0MBynN
About Lpath, Inc.
San Diego, Calif.-based Lpath, Inc. is a biotechnology company
focused on the discovery and development of lipidomic-based
therapeutics, an emerging field of medical science whereby
bioactive lipids are targeted to treat human diseases.
The Company reported a net loss of $3.11 million in 2011, compared
with a net loss of $4.60 million in 2010.
The Company's balance sheet at Dec. 31, 2011, showed
$17.94 million in total assets, $17.31 million in total
liabilities and $629,024 in total stockholders' equity.
Moss Adams LLP, in San Diego, California, did not include a "going
concern" qualification in its report on the Company's 2011
financial results.
As reported by the TCR on March 28, 2011, Moss Adams LLP,
expressed substantial doubt about the Company's
ability to continue as a going concern after auditing the
Company's financial statements at the end of 2009. The
independent auditors noted that the Company had incurred
significant cash losses from operations since inception and
expects to continue to incur cash losses from operations in 2010
and beyond. In its audit report for 2010, the auditor did not
issue a going concern qualification.
LSP ENERGY: Moody's Withdraws 'Caa3' Rating on Sr. Secured Bonds
----------------------------------------------------------------
Moody's Investors Service has withdrawn the rating of LSP Energy
Limited Partnership's senior secured bonds following the company's
bankruptcy filing in February 2012.
The last rating action on LSP occurred on February 1, 2012 when
the rating was revised to Caa3 from Caa2 with the outlook
remaining negative.
The principal methodology used in this rating was Power Generation
Projects published in December 2008.
LSP Energy Limited Partnership is a limited partnership that owns
and operates an 837 MW combined-cycle natural gas-fired electric
generating facility located in Batesville, Mississippi. LSP Energy
Limited Partnership is approximately 96% owned by Batesville
Generation Holdings LLC (BGH). BGH is currently owned by a group
of institutional investors.
M WAIKIKI: Court Denies Marriott's Plea on Estimation Hearing
-------------------------------------------------------------
The Hon. Robert J. Faris of the U.S. Bankruptcy Court for the
District of Hawaii denied Marriott International, Inc. and
Marriott Hotel Services, Inc.'s motion to limit the scope of the
estimation hearing or alternatively, to dismiss certain of
M Waikiki, LLC's objections and disallow discovery related to
those objections.
The Court said that, among other things:
-- the Debtor has agreed that it will not argue at the
estimation hearing that the value of Marriott's claim is zero
because it breached its Management Agreement with the Debtor; and
-- the Debtor will add David Matthiesen to the list of
custodians from whom they review and produce documents. The
Debtor will only be required to produce non-privileged documents.
About M Waikiki
M Waikiki owns the Modern Honolulu, a world-class, luxury hotel
property located close to Waikiki Beach in Hawaii. The hotel is
being managed by Modern Management Services LLC, an affiliate of
Aqua Hotels and Resorts.
M Waikiki is a Hawaii limited liability company with its principal
place of business located in San Diego, California. It is a
special purpose entity, having roughly 75 indirect investors,
which was formed to acquire the Hotel.
The Company filed for Chapter 11 protection (Bankr. D. Hawaii Case
No. 11-02371) on Aug. 31, 2011. Judge Robert J. Faris presides
over the case. Patrick J. Neligan, Esq., and James P. Muenker,
Esq., at Neligan Foley LLP, in Dallas, Tex.; Simon Klevansky,
Esq., Alika L. Piper, Esq., and Nicole D. Stucki, Esq., at
Klevansky Piper, LLP, in Honolulu, Hawaii, are the attorneys to
the Debtor. The Debtor tapped XRoads Solutions Group, LLC, and
Xroads Case Management Services, LLC, as its financial and
restructuring advisor. The Debtor disclosed $216,116,142 in
assets and $135,085,843 in liabilities as of the Chapter 11
filing.
Modern Management is represented by Christopher J. Muzzi, Esq.,
at Moseley Biehl Tsugawa Lau & Muzzi LLC.
Marriott Hotel Services, which used to provide management
services, is represented by Susan Tius, Esq., at Rush Moore LLP
LLP, and Carren B. Shulman, Esq., at Sheppard Mullin Richter &
Hampton LLP.
M.D.C. HOLDINGS: Moody's Issues Summary Credit Opinion
------------------------------------------------------
Moody's Investors Service issued a summary credit opinion on
M.D.C. Holdings, Inc. and includes certain regulatory disclosures
regarding its ratings. The release does not constitute any change
in Moody's ratings or rating rationale for M.D.C. Holdings, Inc.
and its affiliates.
Moody's current ratings on M.D.C. Holdings, Inc. and its
affiliates are:
Senior Unsecured domestic currency ratings of Baa3
Senior Unsecured MTN Program domestic currency ratings of (P)Baa3
Subordinate MTN Program domestic currency ratings of (P)Ba2
Senior Unsecured Shelf domestic currency ratings of (P)Baa3
Senior Subordinate Shelf domestic currency ratings of (P)Ba2
Junior Subordinate Shelf domestic currency ratings of(P)Ba2
Preferred Shelf domestic currency ratings of (P)Ba3
MDC Capital Funding Trust I
Backed Preferred Shelf domestic currency ratings of (P)Ba3
Ratings Rationale
The Baa3 rating considers MDC's strong liquidity position,
conservative land strategy, and its possession of one of the
cleanest, most transparent balance sheets in the industry. The
company's net cash position (cash and investments less debt) was
approximately $119 million at December 31, 2011, and the nearest
debt maturity (of $250 million) is in 2014. The company typically
holds the shortest total land supply in the industry (both owned
and optioned combined), and its current supply is calculated by
Moody's to be approximately three years.
At the same time, MDC's rating balances its large cash position
and cash generation track record against Moody's expectation that
the company will continue to burn modest amounts of cash in 2012
(after turning cash flow negative in 2010 and 2011). In addition,
most of the company's traditional credit metrics will remain
subpar for its rating in 2012, and the company faces the same
daunting industry challenges as its peers. As a result, the
company will be challenged to meet Moody's expectation of positive
net income in 2012, coming on the heels of five consecutive year
of net losses (excluding the income tax benefit in 2009 from the
expanded NOL carryback provision).
Rating Outlook
The stable outlook reflects Moody's expectation that MDC will
remain in a modest net cash position in 2012 despite a continuing
appreciable land spend and projected negative cash flow
generation. The stable outlook also considers that the company
does not have any significant debt maturities before December
2014, and that any type of volume increase, which Moody's is
projecting, should permit the company to begin generating positive
net income.
What Could Change The Rating Up
The outlook and/or ratings could improve if the company were to
maintain its strong liquidity position, stem the erosion of its
net worth and restore its growth, and become very profitable on a
bottom line basis.
What Could Change The Rating Down
The outlook and/or ratings could come under pressure if the
company continues generating losses throughout 2012 or its
liquidity position were to deteriorate significantly such that it
would be in a material net debt position within the next year.
Further, the ratings and/or outlook could be lowered if the
company made a sizable debt-financed acquisition and/or instituted
a material share repurchase program.
The principal methodology used in rating M.D.C. Holdings, Inc. was
the Global Homebuilding Industry Methodology published in March
2009.
MANITOWOC COMPANY: Moody's Changes Rating Outlook to Positive
-------------------------------------------------------------
Moody's Investors Service affirmed all the ratings of The
Manitowoc Company, Inc. and changed the ratings outlook to
positive from stable. The change in outlook to positive
acknowledges the company's improved operating performance in 2011
and reflects Moody's expectation for solid revenue and
profitability growth over the next 12-18 months.
Ratings Affirmed (LGD assessments revised):
Corporate Family Rating (CFR) B2
Probability of Default (PDR) B2
Speculative Grade Rating SGL-3
Senior Secured Revolver Ba2 (to LGD2, 11% from LGD2, 19%)
Senior Secured Term Loan A Ba2 (to LGD2, 11% from LGD2, 19%)
Senior Secured Term Loan B Ba2 (to LGD2, 11% from LGD2, 19%)
$150M Senior Notes at 7.125% B3 (to LGD4, 67% from LGD5, 74%)
$400M Senior Notes at 9.5% B3 (to LGD4, 67% from LGD5, 74%)
$600M Senior Notes at 8.5% B3 (to LGD4, 67% from LGD5, 74%)
Ratings Rationale
The positive outlook reflects Moody's anticipation of steady
growth in demand in the company's cranes and foodservice segments
which will lead to improved profitability and cash flow. The
company's foodservice segment revenues grew by 6.7% in 2011 while
operating profit grew by 6.4%. Similarly, revenue in its cranes
operations grew by 23.8% while operating profit grew by 18.9%
after a decline of 38% in 2010. Moody's believes the company will
use its improved cash flows to pay down debt.
The affirmation of the B2 CFR and PDR considers the company's
still relatively high leverage and low interest coverage. At
December 31, 2011, the company had Debt to EBITDA of 6.0 times and
EBITA to interest of 1.6 times, both on a Moody's adjusted basis.
While the company has made significant progress in diversifying
its geographic base, the company still has relatively modest
exposure to the faster growing regions outside of the US and
Western Europe. Furthermore, the company's cranes backlog, while
improving, is still well off its peak.
The ratings could be upgraded if the company demonstrates
sustained revenue, earnings and backlog growth while effectively
managing working capital levels and liquidity. Quantitatively, a
ratings upgrade would be considered if leverage improves to under
4.5 times and EBITA coverage of interest to over 2.0 times, on a
Moody's adjusted basis.
The ratings could be pressured if revenue and profitability
materially decline leading to weaker credit metrics.
Quantitatively, the ratings could be downgraded if Debt to EBITDA
is sustained at well over 6.5 times or EBITA/interest expense is
sustained at less than 1.2 times, on a Moody's adjusted basis.
The principal methodology used in rating Manitowoc Company Inc.
was the Global Manufacturing Industry Methodology, published
December 2010. Other methodologies used include Loss Given Default
for Speculative Grade Issuers in the US, Canada, and EMEA,
published June 2009.
The Manitowoc Company, Inc., headquartered in Manitowoc, WI, is a
diversified global manufacturer supporting the construction and
foodservice end markets. Revenues for 2011 were over $3.7 billion.
MECHEL OAO: Commences Discussions With Lenders, Seeks Waivers
-------------------------------------------------------------
Mechel OAO commenced discussions with its lenders seeking waivers
and amendments to certain of its credit facilities.
As a result of prevailing market conditions and a corresponding
decline in market prices for its products, it expects to breach
certain financial covenants in certain of its credit facilities
for the year ended Dec. 31, 2011.
Mechel has hired financial and other advisors and is currently in
discussions with its lenders to seek relevant waivers and
amendments of these credit facilities. Although Mechel is
confident about the positive outcome of these discussions, no
assurance can be given regarding whether, or on what terms, it
will be able to secure such waivers and amendments.
About Mechel OAO
Mechel OAO is a Russia-based integrated mining and steel company.
The Company focuses on the production of mining products, such as
coal, iron ore, nickel, and steel products. Its operations are
divided into two segments: Mining and Steel. The Mining segment
focuses on the production and sales of coking coal concentrate,
iron ore concentrate and coke with assets in Russia and the United
States. The Steel segment comprises production and sale of semi-
finished steel products, carbon and specialty long products,
stainless flat products, and value-added downstream metal
products, including hardware and stampings. The Company has
production facilities in 13 of Russia?s regions, as well as the
United States, Kazakhstan, Romania, Lithuania and Bulgaria.
Additionally, Mechel OAO owns two trade ports and a railway
company. In 2011, the Company completed the acquisition of a 100%
stake in Rostvoskiy elektrometallurgicheskiy zavod (REMZ).
MEDCLEAN TECHNOLOGIES: Delays Form 10-K for 2011
------------------------------------------------
MedClean Technologies, Inc., notified 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 was not able to obtain all information prior to filing
date and management could not complete the required financial
statements and Management's Discussion and Analysis of those
financial statements by March 30, 2012.
About MedClean Technologies
Based in Bethel, Connecticut, MedClean Technologies, Inc.,
provides solutions for managing medical waste on site including
designing, selling, installing and servicing on site (i.e. "in-
situ") turnkey systems to treat regulated medical waste.
The Company also reported a net loss of $3.69 million on
$1.38 million of total revenues for the nine months ended Sept.
30, 2011, compared with a net loss of $3.50 million on $707,450 of
total revenues for the same period a year ago.
The Company's balance sheet at Sept. 30, 2011, showed
$1.01 million in total assets, $1.88 million in total liabilities,
and a $874,617 total stockholders' deficit.
As reported in the TCR on April 6, 2011, Child, Van Wagoner &
Bradshaw, PLLC, in Salt Lake City, Utah, expressed substantial
doubt about the MedClean Technologies' ability to meet its
obligations and to continue as a going concern, following the
Company's 2010 results. The independent auditors noted that the
Company has incurred substantial recurring losses.
Bankruptcy Warning
The Company has available cash and cash equivalents of
approximately $102,515 at Sept. 30, 2011, which it intends to
utilize for working capital purposes and to continue developing
its business. To supplement its cash resources, the Company has
secured alternative financing arrangements with two investment
entities. While the acquisition of cash through these programs is
related to company performance, the Company believes it will have
access to the necessary funds for its to execute its business
plan. However, the Company continues to incur significant
operating losses that will result in the reduction of its cash
position. The Company cannot assure that it will be able to
continue to obtain funding through the alternative financing
arrangements and the lack thereof would have a material adverse
impact on its business. Moreover, any equity funding could be
substantially dilutive to existing stockholders. The
aforementioned factors raise doubt about the Company's ability to
continue as a going concern. In the event the Company is unable
to continue as a going concern, it may pursue a number of
different options, including, but not limited to, filing for
protection under the federal bankruptcy code.
MEDICAL BILLING: Incurs $6.5 Million Net Loss in 2011
-----------------------------------------------------
Medical Billing Assistance, Inc., filed with the U.S. Securities
and Exchange Commission its Annual Report on Form 10-K disclosing
a net loss of $6.56 million on $1.30 million of rental revenue in
2011, compared with net income of $36,886 on $1.26 million of
rental revenue in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $6.77 million
in total assets, $7.79 million in total liabilities and a $1.02
million total stockholders' deficit.
A copy of the Form 10-K is available for free at:
http://is.gd/Xvqf4K
About Medical Billing
Melbourne, Fla.-based Medical Billing Assistance, Inc., was
incorporated in the State of Colorado on May 30, 2007, to act as a
holding corporation for I.V. Services Ltd., Inc. ("IVS"), a
Florida corporation engaged in providing billing services to the
medical community. IVS was incorporated in the State of Florida
on Sept. 28, 1987.
On Dec. 29, 2010, the Company entered into a Share Exchange
Agreement with FCID Medical, Inc., a Florida corporation and FCID
Holdings, Inc., a Florida corporation, and the shareholders of
FCID. Pursuant to the terms of the Share Exchange Agreement, the
FCID Shareholders exchanged 100% of the outstanding common stock
of FCID for a total of 40,000,000 shares of common stock of the
Company, resulting in FCID Medical and FCID Holdings being 100%
owned subsidiaries of the Company.
All of the Company's operations are conducted out of its wholly-
owned subsidiaries: IVS, FCID Medical and FCID Holdings. The
Company has real estate holdings through FCID Holdings, Inc.,
under which Marina Towers, LLC, is wholly-owned subsidiary.
Ronald R. Chadwick, P.C., in Aurora, Colo., expressed substantial
doubt about 's ability to continue as a going concern, following
the Company's 2010 results. Mr. Chadwick noted that the Company
has a working capital and stockholders' deficit.
Mr. Chadwick did not include a "going concern" qualification in
his report on the Company's 2011 financial results.
MEDICAL CONNECTIONS: Incurs $3.7 Million Net Loss in 2011
---------------------------------------------------------
Medical Connections Holdings, Inc., filed with the U.S. Securities
and Exchange Commission its Annual Report on Form 10-K disclosing
a net loss of $3.71 million on $6.65 million of revenue in 2011,
compared with a net loss of $7.78 million on $7.80 million of
revenue in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $1.74 million
in total assets, $678,754 in total liabilities and $1.06 million
in total stockholders' equity.
De Meo, Young, McGrath, in Boca Raton, Florida, noted that the
Company's dependence on outside financing, lack of sufficient
working capital, and recurring losses from consolidated operations
raise substantial doubt about the Company's ability to continue as
a going concern.
A copy of the Form 10-K is available for free at:
http://is.gd/4ZdL0O
About Medical Connections
Boca Raton, Fla.-based Medical Connections Holdings, Inc., is a
healthcare staffing company which provides staffing services for
allied professionals and nurses to the Company's clients on a
national basis.
MILLAR WESTERN: S&P Affirms 'B-' Corp. Credit Rating; Outlook Neg
-----------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Calgary,
Alta.-based Millar Western Forest Products Ltd. to negative from
stable.
"Standard & Poor's also affirmed its 'B-' long-term corporate
credit rating on the company, as well its 'B-' issue-level rating
on Millar Western's senior unsecured notes due 2021. The '4'
recovery rating on the debt is unchanged," S&P said.
"The outlook revision reflects our concerns about the company's
deteriorating profitability stemming from lower bleached chemi-
thermomechanical pulp prices and negative cash flow generation,"
said Standard & Poor's credit analyst Jatinder Mall.
"The ratings on Millar Western reflect what Standard & Poor's
views as the company's highly leveraged financial risk profile;
participation in the highly cyclical, fragmented, and competitive
pulp and lumber industries; competition in hardwood pulp from
South American producers; exposure to changes in volatile exchange
rates; and limited geographic diversity. These weaknesses are
partially offset, in our opinion, by the company's modern,
efficient assets, and high degree of fiber and energy self-
sufficiency," S&P said.
"Millar Western is a small, privately held pulp and lumber
producer. It operates three sawmills with a combined annual
capacity of 540 million board feet, and one pulp mill with an
annual capacity to produce 320,000 metric tons of bleached chemi-
thermomechanical pulp (BCTMP)," S&P said.
"The negative outlook reflects what we view as Millar Western's
deteriorating profitability stemming from lower BCTMP prices and
negative cash flow generation. While we expect the company will
generate negative cash from operations, liquidity should remain in
the C$45 million-C$60 million range in 2012. A negative rating
action would likely occur if cash burn accelerates, resulting in a
weakening of Millar Western's fixed charge coverage ratio below
1x," S&P said.
"A positive rating action in the near term is unlikely but would
require the company to demonstrate improved profitability in the
coming quarters resulting in a debt-to-EBITDA ratio of below 5x on
a sustained basis. The ratings are constrained to the 'B' category
by Millar Western's business risk profile, including its small
market position in the highly competitive pulp and lumber
industries, exposure to volatile pulp and lumber prices and
exchange rates, and limited operating diversity," S&P said.
MMRGLOBAL INC: Incurs $8.8 Million Net Loss in 2011
---------------------------------------------------
MMRGlobal, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss of
$8.88 million on $1.42 million of total revenues in 2011, compared
with a net loss of $17.90 million on $972,988 of total revenues in
2010. The Company reported a net loss of $10.3 million on
$619,249 of revenues for 2009.
The Company's balance sheet at Dec. 31, 2011, showed $2.22 million
in total assets, $7.51 million in total liabilities, and a
$5.28 million total stockholders' deficit.
Rose, Snyder & Jacobs LLP, in Encino, California, expressed
substantial doubt about the Company's ability to continue as a
going concern. The auditor issued going concern qualification in
the 2010 and 2011 financial statements. The independent auditors
noted that the Company has incurred significant operating losses
and negative cash flows from operations during the years ended
Dec. 31, 2011, and 2010.
MMRGlobal submitted its 2011 annual report on Form 10-K for the
period ended Dec. 31, 2011 on March 30, 2012, after the close of
market. The Form 10-K filing was following with a conference call
hosted by Bob Lorsch, Chief Executive Officer, and Ingrid
Safranek, Chief Financial Officer.
A copy of the Form 10-K is available for free at:
http://is.gd/7c9Uws
A copy of the press release is available for free at:
http://is.gd/6nHf6g
About MMRGlobal
Los Angeles, Calif.-based MMR Global, Inc. (OTC BB: MMRF)
-- http://www.mmrglobal.com/-- through its wholly-owned operating
subsidiary, MyMedicalRecords, Inc., provides secure and easy-to-
use online Personal Health Records (PHRs) and electronic safe
deposit box storage solutions, serving consumers, healthcare
professionals, employers, insurance companies, financial
institutions, and professional organizations and affinity groups.
NATIONSTAR MORTGAGE: S&P Raises Counterparty Credit Rating to 'B'
-----------------------------------------------------------------
Standard & Poor's Ratings Services raised its counterparty credit
rating on Nationstar Mortgage LLC to 'B+' from 'B'. The outlook is
stable. At the same time, Standard & Poor's raised its rating on
Nationstar's senior unsecured debt to 'B+' from 'B'.
"The upgrades reflect management's ability to maintain adequate
capital while significantly improving the firm's strategic
position," said Standard & Poor's credit analyst Jeffrey Zaun.
"The positive rating factors include low credit risk, good risk
management, and favorable near-term market conditions. The company
is expanding quickly not only through acquisitions, but also
through a significant influx of servicing opportunities as banks
shed 'high-touch' servicing. We expect Nationstar's cash flows and
earnings to improve as a result of this trend."
"Nationstar raised $247 million with its March 2012 initial public
offering (IPO), significantly reducing leverage. We believe,
however, that management will issue significant amounts of new
debt to fund growth in the servicing portfolio. The firm's
leverage along with the its dependence on market funding and its
limited earnings track record partially offset the positive
momentum. Finally, we remain uncertain about the prospects of the
firm's long-term strategy for operating in a more normalized
housing market."
"The stable outlook reflects our view of Nationstar's improved
earnings and strong strategic position, offset by the operational
risks that result from the firm's rapid growth," said Mr. Zaun.
"Although Nationstar's competitive position has improved since we
assigned the rating in 2010, we could lower the rating if the
firm's earnings and interest coverage deteriorate materially.
Specifically, if the ratio of adjusted EBITDA to interest
(excluding one-time noncash charges) falls below 1.2x for more
than two consecutive quarters without a credible plan to return to
more normal levels, we likely would downgrade the firm. We could
upgrade the rating if the firm's growth rate slows and if it is
able to maintain leverage and earnings metrics. Specifically, for
an upgrade, we would expect normalized debt to adjusted total
equity to beunder 5x and debt outside the warehouse to adjusted
EBITDA to remain under 4x," S&P said.
NEBRASKA BOOK: Amended Plan Support Agreement Approved
------------------------------------------------------
On March 23, 2012, NBC Acquisition Corp., et al., entered into an
Amended and Restated Plan Support Agreement with certain
beneficial owners (or investment advisors) collectively holding
approximately 70% of the outstanding principal amount of the 10%
senior secured notes due 2011 of Nebraska Book and certain
beneficial owners (or investment advisors) collectively holding
greater than 66% of the outstanding principal amount of the 8.625%
senior subordinated notes due 2012 of Nebraska Book. The
execution and implementation of the Amended Plan Support Agreement
was approved by the Court on March 26, 2012. Pursuant to the
terms of the Amended Plan Support Agreement, the parties thereto
commit to implement a financial restructuring of the Debtors'
indebtedness and other obligations through a solicitation of votes
for a chapter 11 plan of reorganization of the Debtors.
A copy of the Amended PSA, dated March 23, 2012, is available for
free at http://is.gd/mzmwZ0
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 has been 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.
NEOMEDIA TECHNOLOGIES: Delays Form 10-K for 2011
------------------------------------------------
NeoMedia Technologies, Inc., was unable to file its annual report
on Form 10-K for the period ended Dec. 31, 2011, within the
prescribed period due to unforeseen circumstances. Those
circumstances prevent the Company from filing the annual report
without unreasonable efforts or expense. The Company's annual
report for the period ended Dec. 31, 2011, will be filed on or
before the 15th calendar day following the prescribed due date.
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.
NETWORK CN: Delays Form 10-K for 2011
-------------------------------------
Network CN Inc.'s annual report on Form 10-K for the year ended
Dec. 31, 2011, could not be filed without unreasonable effort or
expense within the prescribed time period because management
requires additional time to compile the information requested from
its auditor. The Company believes that the Form 10-K will be
filed within the period described under Rule 12b-25(b)(2)(ii).
About Network CN
Network CN Inc. (OTC QB: NWCN) -- http://www.ncnmedia.com/-- is
building a multi-media, multi-application out-of-home advertising
network in the key cities of China. Network CN Inc. was
incorporated in the State of Delaware in 1993 and is headquartered
in Causeway Bay, Hong Kong.
The Company reported a net loss of $1.69 million for the nine
months ended Sept. 30, 2011, compared with a net loss of
$2.39 million for the same period a year ago.
The Company's balance sheet at Sept. 30, 2011, showed
$1.02 million in total assets, $5.73 million in total liabilities,
and a $4.71 million total stockholders' deficit.
As reported in the TCR on Mar 24, 2011, Baker Tilly Hong Kong
Limited, in Hong Kong SAR, expressed substantial doubt about
Network CN's ability to continue as a going concern, following the
Company's 2010 results. The independent auditors noted that the
Company has incurred net losses of $2.60 million and
$37.38 million for the years ended Dec. 31, 2010, and 2009,
respectively. As of Dec. 31, 2010, the Company recorded a
stockholders' deficit of $3.52 million.
NEXTMEDIA OPERATING: S&P Affirms 'B-' Corporate Credit Rating
-------------------------------------------------------------
Standard & Poor's Ratings Services revised its rating outlook on
Greenwood Village, Colo.-based diversified media company NextMedia
Operating Inc. to negative from stable. "At the same time, we
affirmed our ratings on the company, including the 'B-' corporate
credit rating," S&P said.
"The outlook revision to negative reflects our expectation that
the company will need to refinance or obtain an amendment in order
to maintain compliance with its financial covenants in early
2013," said Standard & Poor's credit analyst Jeanne Shoesmith.
"The 'B-' rating reflects our expectation that tightening
covenants will cause the company's cushion of compliance, along
with its liquidity, to erode over the next year. We view
NextMedia's business risk profile as 'weak' (based on our
criteria) because of negative secular trends facing the radio
industry and some revenue concentration in markets experiencing
persistent economic pressure. NextMedia's very high lease-adjusted
debt to EBITDA of 7.3x underpins our view of the company's
financial risk profile as 'highly leveraged.' We believe the
company will be able to maintain covenant compliance in 2012 by
repaying debt as necessary. However, the company will likely need
to refinance or amend its covenants to avoid a violation in early
2013 if revenue and EBITDA trends do not improve meaningfully,"
S&P said.
"Our assessment of NextMedia's business risk as 'weak' stems from
its exposure to radio advertising (56% of revenues for the 12
months ended Dec. 31, 2011). The company's radio results have
underperformed U.S. industry peers', partly because of its
dependence on lagging local advertising, coupled with persistent
economic weakness. We believe the radio industry faces secular
risks that could impede sustained growth--most importantly, market
share loss to alternative traditional and digital media. In our
view, there are moderate longer-term growth prospects at the
outdoor segment (34% of 2011 revenues), which is under less
structural pressure than certain other local media, such as radio,
newspapers, and directories. We believe that radio revenue could
grow slightly in 2012. However, beyond 2012, we expect declines in
radio revenue to offset much of the growth at the outdoor
segment," S&P said.
"Under our base-case scenario, we expect 2012 revenue and EBITDA
growth at a low-single-digit and mid-single-digit percentage rate,
respectively. We expect radio revenue to grow at a low-single-
digit rate in 2012 because of easier comparisons and management
changes made in 2011 in underperforming markets," S&P said.
"We expect outdoor revenue growth to slow slightly, to a low-
single-digit rate, despite a higher number of digital boards
because of continuing economic weakness and difficulty in raising
rates. Over that time, we expect the EBITDA margin to remain
roughly flat. Longer term, we expect radio revenue declines due to
secular pressures," S&P said.
NORTEL NETWORKS: Davis Polk, et al., OK'd as Mediator's Advisors
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
the Hon. Warren K. Winkler, Chief Justice of Ontario, mediator for
Nortel Networks Corporation, et al., to employ Davis Polk &
Wardell, LLP and Rueter Scarcall Bennett L.L.P., as advisors.
The advisors will be paid, nunc pro tunc to the dates they
commenced work for the mediator, their reasonable fees and
expenses.
The U.S. Debtors, the Canadian Debtors, the EMEA Debtors and any
other party to the mediation will receive only non-itemized
invoices to protect the confidentiality of the mediator's work.
The advisors will be entitled to the same protections and
confidentiality as afforded to the mediator.
About Nortel Networks
Nortel Networks (OTC BB: NRTLQ) -- http://www.nortel.com/-- was
once North America's largest communications equipment provider.
It has sold most of the businesses while in bankruptcy.
Nortel Networks Corp., Nortel Networks Inc., and other affiliated
corporations in Canada sought insolvency protection under the
Companies' Creditors Arrangement Act in the Ontario Superior Court
of Justice (Commercial List). Ernst & Young was appointed to
serve as monitor and foreign representative of the Canadian Nortel
Group.
The Monitor sought recognition of the CCAA Proceedings in the
U.S. by filing a bankruptcy petition under Chapter 15 of the U.S.
Bankruptcy Code (Bankr. D. Del. Case No. 09-10164). Mary
Caloway,Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll &
Rooney PC, in Wilmington, Delaware, serves as the Chapter 15
petitioner's counsel.
Nortel Networks Inc. and 14 affiliates filed separate Chapter 11
petitions (Bankr. D. Del. Case No. 09-10138) on Jan. 14, 2009.
Judge Kevin Gross presides over the case. James L. Bromley, Esq.,
at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as
general bankruptcy counsel; Derek C. Abbott, Esq., at Morris
Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware
counsel. The Chapter 11 Debtors' other professionals are Lazard
Freres & Co. LLC as financial advisors; and Epiq Bankruptcy
Solutions LLC as claims and notice agent.
Certain of Nortel's European subsidiaries also made consequential
filings for creditor protection. On May 28, 2009, at the request
of the Administrators, the Commercial Court of Versailles, France
ordered the commencement of secondary proceedings in respect of
Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited
filed petitions in this Court for recognition of the English
Proceedings as foreign main proceedings under chapter 15 of the
Bankruptcy Code.
Nortel has collected almost $9 billion for distribution to
creditors. Of the total, US$4.5 billion came from the sale of
Nortel's patent portfolio to Rockstar Bidco, a consortium
consisting of Apple Inc., EMC Corporation, Telefonaktiebolaget LM
Ericsson, Microsoft Corp., Research In Motion Limited, and Sony
Corporation. The consortium defeated a $900 million stalking
horse bid by Google Inc. at an auction. The deal closed in July
2011.
Nortel Networks has filed a proposed plan of liquidation in the
U.S. Bankruptcy Court. The Plan generally provides for full
payment on secured claims with other distributions going in
accordance with the priorities in bankruptcy law.
The Office of the United States Trustee for the District of
Delaware has appointed an Official Committee of Unsecured
Creditors in respect of the Debtors, and an ad hoc group of
bondholders has been organized.
Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Feld LLP, in
New York, and Christopher M. Samis, Esq., at Richards, Layton &
Finger, P.A., in Wilmington, Delaware, represent the Official
Committee of Unsecured Creditors.
The Official Committee of Retired Employees and the Official
Committee of Long-Term Disability Participants tapped Alvarez &
Marsal Healthcare Industry Group as financial advisor. The
Retiree Committee is represented by McCarter & English LLP as
Delaware counsel, and Togut Segal & Segal serves as the Retiree
Committee. The Committee retained Alvarez & Marsal Healthcare
Industry Group as financial advisor, and Kurtzman Carson
Consultants LLC as its communications agent.
NOVA CHEMICALS: S&P Hikes Corp. Credit Rating to 'BB'; Outlook Pos
------------------------------------------------------------------
Standard & Poor's Ratings Services raised its long-term corporate
credit rating on NOVA Chemicals Corp. to 'BB' from 'BB-'. The
outlook is positive.
"At the same time, we revised our issue-level rating on NOVA
Chemicals' senior unsecured debt to 'BB' from 'BB-'. The '4'
recovery rating on the debt is unchanged, and indicates our
expectation of average (30%-50%) recovery in the event of
default," S&P said.
"We base the upgrade on NOVA on our view of the company's recent
debt reduction and expected good cash flow generation in the near
term," said Standard & Poor's credit analyst Jatinder Mall.
"The ratings on NOVA Chemicals reflect what Standard & Poor's
views as the company's exposure to volatile commodity chemicals
and limited operational and product diversity. These weaknesses
are counterbalanced, in our opinion, by the company's cost-
competitive olefins/polyolefins business, which generates good
cash flow through the cycle, improving leverage, and parental
support from International Petroleum Investment Co. (IPIC;
AA/Stable/A-1+)," S&P said.
NOVA Chemicals produces commodity chemicals and plastics used in
consumer, industrial, and packaging products. The company has an
annual production capacity of 6,600 million pounds of ethylene and
3,720 million pounds of polyethylene. It also produces a small
amount of performance styrenics, which includes expandable
polystyrene and styrenic polymer performance products.
"The positive outlook reflects Standard & Poor's view that the
company is likely to generate strong cash flows in 2012 on better
market conditions and pricing for ethylene and polyethylene. The
outlook also reflects our view that IPIC will invest the majority
of NOVA Chemicals' cash generation back into the business rather
than take dividends," S&P said.
"While we do not expect the company to further reduce debt in the
near term, we expect Standard & Poor's adjusted leverage to remain
below 3x in 2012. We could upgrade the company if we view concrete
evidence of additional parental support including operational
integration into IPIC's portfolio of chemical assets or leverage
of 2x-3x on a sustained basis," S&P said.
"Alternatively, we could lower the ratings on the company if
market conditions quickly deteriorate due to an economic slowdown,
if the Joffre plant production reduces significantly due to lower
ethane supply, leading to Standard & Poor's adjusted leverage of
above 4x, or if we view that IPIC has changed its parental support
or financial policy toward NOVA Chemicals," S&P said.
OMNICARE INC: S&P Gives 'BB' Rating on $390MM Sr. Sub. Notes
------------------------------------------------------------
Standard & Poor's Rating Services assigned its 'BB' subordinated
debt rating and '4' recovery rating to Covington, Ky.-based
Omnicare Inc.'s new $390 million, 3.75% convertible senior
subordinated notes due 2042. The '4' recovery rating indicates our
expectation for average (30%-50%) recovery in the event of a
default.
"We also affirmed our existing ratings on the company, including
our 'BB' corporate credit rating. The rating outlook is stable,"
S&P said.
"The private debt exchange will add approximately $133 million of
incremental debt, not significant enough to alter our ratings or
outlook on Omnicare. Our adjusted debt to EBITDA calculation will
increase to just over 4.0x from 3.9x as of Dec. 31, 2011," S&P
said.
"We rate Omnicare's existing senior unsecured credit facility
'BBB-' (two notches above the corporate credit rating), with a
recovery rating of '1', indicating our expectation for very high
(90%-100%) recovery in the event of default. In addition, we rate
the senior unsecured 3.25% convertible debt 'B+' (two notches
lower than the corporate credit rating) with a '6' recovery
rating, indicating our expectation for negligible (0%-10%)
recovery in the event of default," S&P said.
"The ratings on Omnicare Inc. reflect our expectations for flat
revenues in 2012, given the pressure created by new generic drugs
and improved, but still stagnant, organic bed growth," said
Standard & Poor's credit analyst Jesse Juliano. "We believe
margins could improve by as much as 100 basis points, given the
impact of more profitable generic drugs and Omnicare's cost-saving
initiatives. We expect it to generate roughly $450 million of
operating cash flow in 2012, down from $550 million in 2011.
However, 2011 included some working capital improvements and cash
refunds for taxes unlikely to recur in 2012."
"Omnicare's 'fair' business risk profile reflects the
stabilization of beds served, and thus the stabilization of total
prescriptions dispensed. We expect beds served to remain flat in
2012, with acquisitions providing some potential upside.
Omnicare's number of beds served, a key driver of revenue growth,
improved sequentially in the fourth quarter of 2011 to 1,378,000
from 1,376,000 as of Sept. 30, 2011. Omnicare did not acquire any
beds in the fourth quarter of 2011, and this is its first quarter
of organic bed growth in over eight years. We believe the
company's refocus on customer experience, and sales and marketing
helped it improve customer retention," S&P said.
"The fair business risk profile continues to reflect Omnicare's
narrow business focus, exposing it to industry-specific risks,
such as the potential for future reimbursement pressure. However,
risks partly are offset by the company's opportunity to capitalize
on its leading position as a provider of pharmacy services to
nursing homes and other long-term care providers, and its ability
to generate free cash flow despite numerous operating hurdles over
the past few years. Omnicare achieved its leading market position
through a long series of acquisitions. It leverages this larger
size to achieve operational economies of scale and improve its
purchasing clout with pharmaceutical manufacturers. Given its
broad industry presence, it would be difficult for any national
managed care company to serve its nursing home and long-term care
members without operating through Omnicare," S&P said.
OXYSURE SYSTEMS: Incurs $1.53 Million Net Loss in 2011
------------------------------------------------------
Oxysure Systems, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss of
$1.53 million on $185,209 of net revenues in 2011, compared with a
net loss of $1.57 million on $356,013 of net revenues in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $947,934 in
total assets, $3.72 million in total liabilities, and a
$2.77 million total stockholders' deficit.
Sam Kan & Company, in Alameda, California, noted that the Company
has suffered recurring losses and has experienced negative cash
flows from operations, which raises substantial doubt about the
Company's ability to continue as a going concern.
A copy of the Form 10-K is available for free at:
http://is.gd/gAp4zD
About OxySure Systems
Frisco, Tex-based OxySure Systems, Inc., was formed on Jan. 15,
2004, as a Delaware "C" Corporation for the purpose of developing
products with the capability of generating medical grade oxygen
"on demand," without the necessity of storing oxygen in compressed
tanks. The Company developed a unique technology that generates
medically pure (USP) oxygen from two dry, inert powders. Other
available chemical oxygen generating technologies contain hazards
that the Company believes make them commercially unviable for
broad-based emergency use by lay rescuers or the general public.
The Company's launch product is the OxySure Model 615 portable
emergency oxygen system. The Company believes that the OxySure
Model 615 is currently the only product on the market that can be
safely pre-positioned in public and private venues for emergency
administration of medical oxygen by lay persons, without the need
for training.
PACER MANAGEMENT: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Pacer Management of Kentucky, LLC
P.O. Box 10
Barbourville, KY 40906-0010
Bankruptcy Case No.: 12-60410
Chapter 11 Petition Date: March 27, 2012
Court: U.S. Bankruptcy Court
Eastern District of Kentucky (London)
Debtor's Counsel: Dean A. Langdon, Esq.
DELCOTTO LAW GROUP PLLC
200 N. Upper Street
Lexington, KY 40507
Tel: (859) 231-5800
E-mail: dlangdon@dlgfirm.com
- and ?
Jamie L. Harris, Esq.
DELCOTTO LAW GROUP PLLC
200 North Upper Street
Lexington, KY 40507
Tel: (859) 231-5800
E-mail: jharris@dlgfirm.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The petition was signed by Craig Morgan, chief executive officer.
Affiliates that simultaneously filed Chapter 11 petitions:
Debtor Case No.
------ --------
Health Management Corporation of Kentucky 12-60411
Cumberland-Pacer, LLC 12-60412
Debtor's List of Its 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
US Bank County of Knox, $15,325,000
214 North Tryon Street 27th ,Floor Kentucky General
Charlotte, NC 28202 Obligation Bonds
Department for Medicaid Services Cost Report $1,283,705
275 E Main Street 6W-C Settlement FYE
Frankfort, KY 40621 12-31-2009
Citizens Guaranty Bank of London Borrower ? Knox $1,024,726
1105 W. 5th Street County Fiscal Court
London, KY 40741
Commercial Bank of Barbourville Borrower ? Knox $503,071
202 N. Main Street County Fiscal Court
P.O. Box 220
Barbourville, KY 40906
Brick Mountain Billing, Inc. -- $157,232
Quest Diagnostics Lab Services $108,788
Kentucky Health Administrators Employee Benefits $84,009
Virtual Radiologic Corporation Professional Services $73,337
Olympus Financial Services Operating Lease $72,539
(Surgery Equipment)
General Electric Capital -- $60,834
Corporation
Cumberland Isotopes LLC Inventory Purchases $51,964
General Electric Capital Lease ? Radiology $51,053
Corporation Equipment
Maxim Physician Resources Professional Services $48,017
Employers Direct Health Employee Benefits $46,982
Forcht Pharmacy Pharmacy Drugs $45,444
Healthcare Management Systems Software ? Medical $41,365
Coding
Baptist Regional Medical Cntr Lab Services $40,655
Poseidon Group, Inc. Software (Monthly $36,586
Fees)
Yalinie Medics Professional Services $33,110
Medline Industries, Inc. Inventory Purchases $32,177
PERRY ELLIS: Moody's Affirms 'B1' Corporate Family Rating
---------------------------------------------------------
Moody's Investors Service affirmed all existing ratings of Perry
Ellis International, Inc. including the B1 Corporate Family
Rating, the B1 Probability of Default Rating and the B2 senior
subordinated notes rating. Moody's also assigned a first time
speculative grade liquidity rating of SGL-2. The outlook remained
stable.
"We affirmed the corporate family rating despite softness in
recent operating performance because the company has been able to
maintain relatively modest debt leverage and interest coverage
metrics," commented Moody's analyst Mariko Semetko. "The rating
also incorporates Moody's expectation for the company to maintain
good liquidity over the next twelve months," added Semetko.
The following rating was assigned:
- Speculative grade liquidity rating at SGL-2
The following ratings were affirmed:
- Corporate Family Rating at B1
- Probability of Default Rating at B1
- $150 million 7.875% senior subordinated notes at B2
(LGD5, 73%)
- Multiple Seniority Shelf at (P)B2
Ratings Rationale
The B1 Corporate Family Rating reflects Perry's volatile track
record of operating performance including EBITA margins that lag
peers, challenges from operating in an industry sensitive to
consumer spending and fashion trends, and sizeable customer
concentration with key retailers. However, the company's well-
known portfolio of brands and wide range of price points partially
mitigates the fashion risk by targeting multiple demographics
while creating a solid presence across various distribution
channels. In addition, the company's modest debt leverage, good
interest coverage, and good near term liquidity support the
rating.
The speculative grade liquidity rating of SGL-2 denotes good near
term liquidity. The SGL-2 is supported by expected positive free
cash flow and modest drawings under the $125 million asset based
revolving facility for seasonal working capital uses.
The stable outlook incorporates relatively stable margins and
positive free cash flow. The stable outlook also reflects Moody's
expectation for Perry to maintain a conservative financial policy
with regards to acquisitions and share repurchases.
Ratings could be downgraded if operating performance deteriorates
such that EBITA margins declined. Specifically, ratings could be
downgraded if the company had sustained negative free cash flow,
if debt-to-EBITDA approached 4.5 times, or if its EBITA margin was
sustained below 5% (all ratios incorporating Moody's standard
analytical adjustments).
Ratings upgrade is unlikely in the near future because of the
company's modest scale and inconsistent operating performance.
Moody's could consider an upgrade if Perry could enhance its
scale, sustain EBITA margins above 10%, and maintain current debt
leverage and interest coverage metrics (all ratios incorporating
Moody's standard analytical adjustments).
The principal methodologies used in this rating were Global
Apparel Industry published in May 2010, and Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.
Perry Ellis International, Inc., headquartered in Miami, Florida
designs, distributes and licenses apparel and accessories for men
and women. The company, through its wholly owned subsidiaries,
owns or licenses a portfolio of brands that includes Perry
Ellis(R), Rafaella(R), Laundry by Shelli Segal(R), C&C
California(R), Original Penguin(R), Cubavera(R), and Nike(R) Swim.
The company also operates roughly 70 own stores. Revenues for the
fiscal year ended January 28, 2012 were approximately $980
million.
PFLEIDERER AG: Fitch Downgrades Issuer Default Rating to 'D'
------------------------------------------------------------
Fitch Ratings has downgraded Pfleiderer AG's Long-term Issuer
Default Rating (IDR) to 'D' from 'C' and its Short-term IDR to 'D'
from 'C'. Pfleiderer's subordinated hybrid bond, issued by its
subsidiary Pfleiderer Finance B.V., is affirmed at 'C' with a
Recovery Rating of 'RR6'.
The downgrade follows the announcement by the company that
Pfleiderer AG has filed an application for insolvency on March 28
2012. In line with Fitch's methodology, the hybrid bond rating
has been affirmed at 'C'. This rating indicates an exceptionally
high level of credit risk and a poor recovery rating.
PHH CORP: S&P Cuts Subordinated Shelf Registration Rating to 'B'
----------------------------------------------------------------
Standard & Poor's Ratings Services corrected its preliminary
rating on PHH Corp.'s March 2011 subordinated debt shelf
registration by lowering it to 'B' from 'B+'. There is no
subordinated debt outstanding under the registration. None of the
outstanding debt ratings or issuer credit rating on PHH are
affected by this correction.
"When we lowered the issuer credit rating on PHH to speculative
grade on Feb. 11, 2009, the preliminary rating on this
subordinated shelf registration should have been two notches lower
than the issuer credit rating on PHH," S&P said.
RATINGS LIST
PHH Corp.
Issuer Credit Rating BB-/Negative/B
Rating Lowered
To From
PHH Corp.
Subordinated Shelf Registration B(prelim) B+(prelim)
PHILADELPHIA ORCHESTRA: Wants to Earmark $3MM to Cover Dues
-----------------------------------------------------------
Peter Dobrin at Inquirer Classical Music Critic reports that
Philadelphia Orchestra Association has filed a motion on March 28,
2012, asking that $3.1 million from the association would be
secured to cover past-due payments owed to the American Federation
of Musicians and Employers' Pension Fund from the time of the
orchestra's bankruptcy last April until the date it withdrew from
the plan in November.
According to the report, the development comes after months of
talks have failed to produce a settlement between the pension fund
and the association over compensating the fund for the orchestra's
withdrawal from the plan. Leaders of the fund say that, absent a
settlement, they are plotting further litigation and expect to
oppose the association's yet-to-be-filed reorganization plan.
The report notes the association plans to file a response to the
motion. "I think that the orchestra will vigorously oppose the
motion, and I think that [the fund has] an administrative claim
that is not supported by applicable law," the report quotes
Lawrence G. McMichael, the association's chief bankruptcy lawyer,
as saying. "That's why we have courts. The judge will hear
evidence and will make a decision."
The report says a court date has been set for April 30, 2012.
The report relates, without a negotiated settlement, the
association risks the AFM-EPF's opposition to any reorganization
plan it files, which could mean a longer and more expensive
process before the orchestra can exit bankruptcy.
The report adds claims filed in the case by the AFM-EPF and other
creditors come to nearly $80 million, taking into account
overlapping claims by the Pension Benefit Guaranty Corp., the
agency of the federal government that insures pension plans. But
McMichael said creditor claims would be paid from a much smaller
pool of money, probably less than $2 million total, that will be
raised from donors.
The report notes, in making its case that $3.1 million be set
aside to cover past-due payments, the AFM-EPF says the total
compensation package -- including uninterrupted participation in
the fund -- was agreed to by the association in exchange for the
musicians' services after the Chapter 11 filing on April 16, 2011.
The report adds the total claim by the fund against the
association for its withdrawal is $35 million, making it one of
the case's largest creditors. A negotiated settlement was under
discussion in past months -- the terms being the amount owed and
the period of time over which the sum would be paid -- but the two
sides have remained far apart.
The report, citing court documents, the debt to the fund exists
because the musicians accrued benefits "that are irrevocable and
must now be funded by other, more responsible contributing
employers to the fund."
About Philadelphia Orchestra
The Philadelphia Orchestra -- http://www.philorch.org/-- claims
to be among the world's leading orchestras. Bloomberg News says
the orchestra became the first major U.S. symphony to file for
bankruptcy protection, surprising the music world.
Previous conductors include Fritz Scheel (1900-07), Carl Pohlig
(1907-12), Leopold Stokowski (1912-41), Eugene Ormandy (1936-80),
Riccardo Muti (1980-92), Wolfgang Sawallisch (1993-2003), and
Christoph Eschenbach (2003-08). Charles Dutoit is currently chief
conductor, and Yannick Nezet-Seguin has assumed the title of music
director designate until he takes up the baton as The Philadelphia
Orchestra's next music director in 2012.
The Philadelphia Orchestra Association, Academy of Music of
Philadelphia, Inc., and Encore Series, Inc., filed separate
Chapter 11 petitions (Bankr. E.D. Pa. Case Nos. 11-13098 to
11-13100) on April 16, 2011. Judge Eric L. Frank presides over
the case. The Philadelphia Orchestra Association is being advised
by Dilworth Paxson LLP, its legal counsel, and Alvarez & Marsal,
its financial advisor. Curley, Hessinger & Johnsrud serves as its
special counsel. Philadelphia Orchestra disclosed $15,950,020 in
assets and $704,033 in liabilities as of the Chapter 11 filing.
Encore Series, Inc., tapped EisnerAmper LLP as accountants and
financial advisors.
Roberta A. DeAngelis, the U.S. Trustee for Region 3, appointed
seven members to the official committee of unsecured creditors in
the Debtors' case. Reed Smith LLP serves as the Committee's
counsel.
The orchestra postpetition signed a new contract with musicians
and authority to terminate the existing musicians' pension plan.
PINNACLE AIRLINES: Files for Chapter 11 to Gain Turnaround
----------------------------------------------------------
Pinnacle Airlines Corp. disclosed that the Company and its
subsidiaries have filed voluntary petitions for relief under
Chapter 11 of the United States Bankruptcy Code in the U.S.
Bankruptcy Court for the Southern District of New York. Pinnacle
intends to use the Chapter 11 process to continue implementing a
comprehensive turnaround plan aimed at addressing its operational
and financial challenges in a rapidly evolving regional airline
industry. During this process, the company will remain focused on
providing passengers with safe, reliable and timely service in
collaboration with its network partners, Delta Connection, United
Express and US Airways Express.
Pinnacle expects to accomplish several key initiatives during the
restructuring process to help ensure that it returns to
profitability and remains viable over the long term as the
regional airline industry continues to contract and transform.
These initiatives include restructuring its key operating
agreements with Delta Air Lines, winding down its operations with
United Airlines, completing the wind-down of its Essential Air
Service (EAS) flying with US Airways, achieving cost savings from
its workforce, identifying additional opportunities across the
organization to reduce costs, and ensuring that it has the
appropriate fleet, staffing levels and network to operate
profitably on an ongoing basis.
Sean Menke, President and CEO of Pinnacle, said, "We intend to use
the Chapter 11 process to reset our financial and operational
structure in order to position Pinnacle for viability over the
long term. Quite simply, our current business model is not
sustainable, as increasing operating expenses, liquidity
constraints, business integration delays and difficulties
associated with combining our operations have hindered our ability
to maximize our growth potential. Following a lengthy review
process, and with the assistance of independent financial,
industry and legal advisors, our Board of Directors determined
that a court-supervised restructuring is the only feasible course
of action to implement our turnaround plan."
Menke continued, "We are committed to delivering safe, reliable
travel throughout this process, and thank all of our employees for
their continued focus on providing our mainline partners and their
customers with on-time flights and superior in-flight service.
Our objective is to emerge from this process as a stronger, more
focused company, with a revised business model, a substantially
improved cost structure and operating agreements that will
position us for profitable growth in the future."
In conjunction with the filing, Pinnacle has received a commitment
for secured super-priority debtor-in-possession financing ("DIP
Financing") from Delta Air Lines, Inc. in the amount of $74.3
million. Following Court approval, $44.3 million will be used by
Pinnacle to repay a secured promissory note held by Delta. The
remaining $30 million in DIP financing, combined with cash
generated by Pinnacle's ongoing operations, will be available to
help ensure that Pinnacle has sufficient liquidity to meet its
operational and restructuring needs.
Pinnacle has filed a series of customary motions with the Court
seeking to ensure the continuation of normal operations, including
requesting Court approval to continue to pay employee wages,
salaries and benefits without interruption and to pay suppliers
for fuel and other goods and services provided after the filing
date.
Pinnacle noted that it previously filed withdrawal notices with
the U.S. Department of Transportation (DOT) for all of the
Essential Air Service (EAS) markets currently served by Colgan
Air, a Pinnacle subsidiary. Pinnacle has asked the DOT to
establish an accelerated process to identify replacement carriers
for the EAS markets it serves, which are currently served by Saab
340 aircraft.
The remaining Saab 340 fleet that Colgan operates for United
Express will be wound down over the next several months, with
these operations projected to end by Aug. 1, 2012. Similarly,
Colgan's Q400 aircraft operations will be wound down by Nov. 30,
2012.
Davis Polk & Wardwell LLP and Akin Gump Strauss Hauer & Feld LLP
are serving as the company's legal advisors in the restructuring.
Barclays Capital and Seabury Group LLC are serving as financial
advisors.
About Pinnacle Airlines Corp.
Pinnacle Airlines Corp. (NASDAQ: PNCL) -- http://www.pncl.com/--
a $1 billion airline holding company with 7,800 employees, is the
parent company of Pinnacle Airlines, Inc.; Mesaba Aviation, Inc.;
and Colgan Air, Inc. Flying as Delta Connection, United Express
and US Airways Express, Pinnacle Airlines Corp. operating
subsidiaries operate 199 regional jets and 80 turboprops on more
than 1,540 daily flights to 188 cities and towns in the United
States, Canada, Mexico and Belize. Corporate offices are located
in Memphis, Tenn., and hub operations are located at 11 major U.S.
airports.
The Company reported $8.81 million on $938.05 million of total
operating revenue for the nine months ended Sept. 30, 2011,
compared with net income of $17.02 million on $729.13 million of
total operating revenue for the same period a year ago.
The Company's balance sheet at Sept. 30, 2011, showed $1.53
billion in total assets, $1.42 billion in total liabilities and
$112.31 million in total stockholders' equity.
PINNACLE AIRLINES: Voluntary Chapter 11 Case Summary
----------------------------------------------------
Debtor: Pinnacle Airlines Corp.
One Commerce Square, 40 S. Main St.
13th Floor
Memphis, Tennessee
Bankruptcy Case No.: 12-11343
Debtor-affiliates that filed separate Chapter 11 petitions:
Debtor Case No.
------ --------
Colgan Air, Inc. 12-11344
Mesaba Aviation, Inc. 12-11345
Pinnacle Airlines, Inc. 12-11346
Pinnacle East Coast Operations Inc. 12-11342
Type of Business: Pinnacle Airlines Corp. (NASDAQ: PNCL) a
$1 billion airline holding company with
7,800 employees, is the parent company of
Pinnacle Airlines, Inc.; Mesaba Aviation,
Inc.; and Colgan Air, Inc. Flying as
Delta Connection, United Express and US
Airways Express, Pinnacle Airlines Corp.
operating subsidiaries operate 199 regional
jets and 80 turboprops on more than 1,540
daily flights to 188 cities and towns in
the United States, Canada, Mexico and Belize.
Corporate offices are located in Memphis,
Tenn., and hub operations are located at 11
major U.S. airports.
Web site: http://www.pncl.com/
Chapter 11 Petition Date: April 1, 2012
Court: U.S. Bankruptcy Court
Southern District of New York
Debtors'
Counsel : Marshall S. Huebner, Esq.
Damian S. Schaible, Esq.
Darren S. Klein, Esq.
DAVIS POLK & WARDWELL LLP
450 Lexington Avenue
New York, NY 10017
Tel: (212) 450-4000
Fax: (212) 450-6539
E-mail: marshall.huebner@davispolk.com
damian.schaible@davispolk.com
darren.klein@davispolk.com
- and -
AKIN GUMP STRAUSS HAUER & FELD LLP
1 Bryant Park
New York, NY 10036
Tel: (212) 872-1000
Fax: (212) 872-1002
Debtors'
Financial
Advisors : BARCLAYS CAPITAL
200 Park Avenue
New York, NY 10166
Tel: (212) 412-4000
Fax: (212) 412-7300
- and -
SEABURY GROUP LLC
1350 Avenue of the Americas
25th Floor
New York, NY 10019
Tel: (212) 284-1133
Fax: (212) 284-1144
Debtors'
Claims and
Noticing
Agent : EPIQ SYSTEMS - BANKRUPTCY SOLUTIONS
757 Third Avenue, 3rd Floor
New York, NY 10017
Tel: (646) 282-2500
Fax: (646) 282-2501
Total Assets: $1,539,488,000 as of Sept. 30, 2011
Total Liabilities: $1,427,172,000 as of Sept. 30, 2011
The petition was signed by John Spanjers, executive vice president
and chief operating officer.
A copy of the list of creditors filed with the petition is
available for free at http://bankrupt.com/misc/nysb12-11343.pdf
POSITRON CORP: Delays Form 10-K for 2011
----------------------------------------
Positron Corporation notified 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 was
unable to complete the necessary XBRL tagging required to prepare
a complete filing. The Company expects to file within the
extension period.
About Positron Corporation
Headquartered in Fishers, Indiana, Positron Corporation is a
molecular imaging company focused on nuclear cardiology.
The Company reported a net loss of $10.92 million on $4.62 million
of sales for the year ended Dec. 31, 2010, compared with a net
loss of $5.75 million on $1.44 million of sales during the prior
year. The Company also reported a net loss of $5.02 million for
the nine months ended Sept. 30, 2011.
The Company's balance sheet at Sept. 30, 2011, showed
$3.15 million in total assets, $5.12 million in total liabilities,
and a $1.96 million total stockholders' deficit.
As reported by the TCR on April 6, 2011, Sassetti LLC, in Oak
Park, Illinois, noted that the Company has a significant
accumulated deficit which raises substantial doubt about its
ability to continue as a going concern.
POWER EFFICIENCY: Incurs $3.6 Million Net Loss in 2011
------------------------------------------------------
Power Efficiency Corporation filed with the U.S. Securities and
Exchange Commission its annual report on Form 10-K disclosing a
net loss of $3.61 million on $450,360 of revenue in 2011, compared
with a net loss of $3.27 million on $576,797 of revenue in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $2.92 million
in total assets, $2.26 million in total liabilities and $661,090
in total stockholders' equity.
BDO USA, LLP, in Las Vegas, Nevada, noted that the Company has
suffered recurring losses and has generated negative cash flows
from operations, among other matters, which raises substantial
doubt about its ability to continue as a going concern.
Bankruptcy Warning
Continuation of the Company as a going concern is dependent upon
achieving profitable operations or accessing sufficient operating
capital. Management's plans to achieve profitability include
developing new products such as hybrid motor starters and single-
phase to three-phase converters, developing business in the Asian
market, obtaining new customers and increasing sales to existing
customers. Management is seeking to raise additional capital
through equity issuance, debt financing or other types of
financing. However, there are no assurances that sufficient
capital will be raised. If the Company is unable to obtain it on
reasonable terms, the Company would be forced to restructure, file
for bankruptcy or significantly curtail operations.
A copy of the Form 10-K is available for free at:
http://is.gd/7R4Cyx
About Power Efficiency
Las Vegas, Nevada-based Power Efficiency Corporation (OTC: PEFF) -
- http://www.powerefficiency.com/-- is a clean technology
company focused on efficiency technologies for electric motors.
PRESIDENTIAL REALTY: Delays Form 10-K for 2011
----------------------------------------------
Presidential Realty Corporation informed the U.S. Securities and
Exchange Commission that it was not able to complete its annual
report on Form 10-K for the fiscal year ended Dec. 31, 2011,
including the financial statements for that period, on a timely
basis, due to unanticipated delays arising in connection with the
preparation thereof. The Company anticipates that it will file
the annual report on Form 10-K no later than the fifteenth
calendar day following the prescribed filing date.
About Presidential Realty
Headquartered in White Plains, New York, Presidential Realty
Corporation, a real estate investment trust, is engaged
principally in the ownership of income-producing real estate and
in the holding of notes and mortgages secured by real estate or
interests in real estate. On Jan. 20, 2011, Presidential
stockholders approved a plan of liquidation, which provides for
the sale of all of the Company's assets over time and the
distribution of the net proceeds of sale to the stockholders after
satisfaction of the Company's liabilities.
The Company's consolidated statement of net assets as of Sept. 30,
2011, showed $7.73 million in total assets, $3.64 million in total
liabilities and $4.09 million in net assets in liquidation.
PROPER POWER: Delays Form 10-K for 2011
---------------------------------------
Proper Power and Energy, Inc.'s annual report on Form 10-K for the
period ending Dec. 31, 2011, could not be filed within the
prescribed time period because the report and required financial
statements could not be completed by the Company and subsequently
reviewed by the Company's independent auditor in a timely manner
without unreasonable effort and expense.
About Proper Power
Tampa, Florida-based Proper Power and Energy, Inc. is an oil and
natural gas exploration company, whose growth strategy is to
acquire mineral rights and search for and develop known reserves
for further production, through an efficient scientific approach
toward exploration.
Peter Messineo, CPA, in Palm Harbor, Florida, expressed
substantial doubt Proper Power and Energy,'s ability to continue
as a going concern, following the Company's 2010 results. The
independent auditors noted that the Company is without significant
operating revenues and has losses from operations and has an
accumulated deficit.
The Company also reported a net loss of $156,086 on $8,813 of net
lease loss for the nine months ended Sept. 30, 2011, compared with
a net loss of $98,240 on $0 of net lease income for the same
period during the prior year.
The Company's balance sheet at Sept. 30, 2011, showed
$1.07 million in total assets, $1.24 million in total liabilities,
and a $174,474 total stockholders' deficit.
PROTEONOMIX INC: Incurs $1.38 Million Net Loss in 2011
------------------------------------------------------
Proteonomix, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss
applicable to common shares of $1.38 million on $26,004 of sales
in 2011, compared with a net loss applicable to common shares of
$3.47 million on $83,321 of sales in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $3.34 million
in total assets, $7.03 million in total liabilities, and a
$3.69 million total stockholders' deficit.
KBL, LLP, in New York, expressed substantial doubt about the
Company's ability to continue as a going concern. The independent
auditors noted that the Company has sustained significant
operating losses and is currently in default of its debt
instrument and needs to obtain additional financing or restructure
its current obligations.
A copy of the Form 10-K is available for free at:
http://is.gd/hZI8ef
About Proteonomix
Proteonomix, Inc. (OTC BB: PROT) -- http://www.proteonomix.com/--
is a biotechnology company focused on developing therapeutics
based upon the use of human cells and their derivatives.
PQ CORP: S&P Rates $200MM 1st Lien Term Loan B+; Outlook Negative
-----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings,
including the 'B' corporate credit rating, on Malvern, Pa.-based
PQ Corp. "At the same time, we revised the outlook to negative
from stable," S&P said.
"We have also assigned our 'B+' issue-level and '2' recovery
ratings to PQ Corp.'s proposed $200 million senior secured first-
lien term loan maturing 2014. The '2' recovery rating reflects our
expectation for a substantial (70% to 90%) recovery in the event
of a payment default. Our rating is based on preliminary terms and
conditions. We expect proceeds from the proposed term loan to
repay the company's existing $200 million first-lien revolving
credit facility maturing 2013, which will be terminated following
this transaction," S&P said.
"The outlook revision to negative reflects our expectation that,
despite the strength of the company's business risk profile,
general economic weakness in important European markets in 2012
could hurt EBITDA, resulting in flat or lower EBITDA relative to
2011," said Standard & Poor's credit analyst Paul Kurias. "This
contrasts with our previous expectation for an improvement in
2012. Deterioration in EBITDA could stall a trend of improvement
in leverage to levels appropriate for the current rating, or even
further weaken leverage metrics during the next several quarters."
"Standard & Poor's could lower the ratings in the next several
quarters if it becomes apparent that earnings or cash flow are
likely to weaken more than anticipated, and if expectations for
improving economic conditions later in 2012 fail to materialize.
We could also lower ratings if liquidity weakens below current
levels, debt maturities due in 2014 become an increasing concern,
or EBITDA cushions under covenants decline," S&P said.
"On the other hand, we could revise the outlook to stable later
this year if unexpectedly earnings, cash flow, and liquidity
strengthen, leverage improves, and the company appears well-
positioned to address its large debt maturities," S&P said.
PREFERRED PROPPANTS: S&P Affirms 'B+' Corporate Credit Rating
-------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit rating on Radnor, Pa.-based Preferred Proppants LLC. The
outlook is stable.
"At the same time, we are lowering our issue-level rating on the
company's senior secured credit facilities to 'B+' from 'BB-'
because the proposed $125 million add-on to the existing facility
will reduce our overall recovery expectations. The total financing
for the 2016 senior secured term loan B is now $350 million. We
also revised our recovery rating on the notes to '3', indicating
that the investors can expect to receive a meaningful (50% to 70%)
recovery in the event of a payment default, from '2'," S&P said.
"The corporate credit rating affirmation reflects our view that
Preferred Proppants' credit metrics will continue to improve in
2012 despite the higher debt load and changing market dynamics in
the frac sand industry," said Standard & Poor's credit analyst
Gayle Bowerman. "We believe that market competition is
intensifying due to an influx of new entrants, significant
capacity expansion coming online over the next 12 months, and a
somewhat weaker demand for certain types of sand products as
drilling activity slows in response to low natural gas prices. The
combination of these factors leads us to believe that the
supply/demand balance in the sand market is on the brink of a
shift towards possible oversupply," S&P said.
"The 'B+' rating and stable rating outlook reflect our view of
Preferred Proppants' financial risk profile as 'aggressive' and
business risk profile as 'fair'. Our base case scenario
incorporates our view that the company is somewhat protected from
shifting dynamics in the frac sand market due to its fully
contracted position for both sand volumes and pricing in 2012.
Longer term, we expect the company's strong asset base, flexible
production process, logistics platform, and contracted position
may reduce the impact of increased competition on profitability.
This assessment takes into account the company's aggressive
capital structure, which is influenced by high debt levels, as
well as its concentrated ownership structure, relatively short
operating history, and dependence on a single, cyclical end
market," S&P said.
"Preferred Proppants's performance in 2011 met our expectations,
with pro forma revenues (including the acquisition of Winn Bay
Sands and excluding freight) of $250 million and EBITDA of $101
million, with year end leverage of 4.3x. Following the
transaction, total debt will be approximately $527 million, with
leverage of 5.2x based on 2011 EBITDA," S&P said.
"The rating outlook is stable, reflecting our assessment of the
company's rapid growth rate and short operating history. We expect
Preferred Proppants to continue to benefit in the coming quarters
due to strong demand for coarse sand products from its end markets
and that it will realize increased production levels as a result
of capacity expansions. As a result, we expect 2012 leverage
around 2.5x and FFO to debt above 20%," S&P said.
"A ratings upgrade is less likely over the next 12 to 18 months
given the external market environment coupled with the company's
modest size, short operating history, and our assessment of its
aggressive financial profile. However, we could raise the ratings
if the company solidifies its competitive position by increasing
its size and scope, and if it demonstrates less aggressive
financial policies," S&P said.
"We could lower the rating if the company's liquidity position
deteriorates due to increases in working capital, it fails to
expand capacity as expected, it initiates a program to return
capital to shareholders in lieu of expected debt repayments, or if
demand from end markets stalls. Specifically, we could lower the
rating if leverage rises above 5x or the company's liquidity
position no longer meets our criteria definition for adequate
liquidity," S&P said.
PROELITE INC: Delays Form 10-K for 2011
---------------------------------------
ProElite, Inc., notified 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
requires additional time to complete the financial statements and
cannot, without unreasonable effort and expense, file its Form 10-
K on or before the prescribed filing date.
About ProElite Inc.
Los Angeles, Calif.-based ProElite, Inc., is a holding company for
entities that (a) organize and promote mixed martial arts matches,
and (b) create an internet community for martial arts enthusiasts
and practitioners.
On Oct. 20, 2008, management, with Board ratification, decided to
close or sell all operations and began an extended period of
restructuring its balance sheet, divesting itself of certain
assets, settlement of contingent liabilities, and attempting to
raise additional capital.
Effective Oct. 12, 2009, the Company entered into a Strategic
Investment Agreement with Stratus Media Group, Inc. ("SMGI")
pursuant to which the Company agreed to sell to SMGI, shares of
the Company's Series A Preferred Stock (the "Preferred Shares").
The Preferred Shares are convertible into the Common Stock of the
Company. This transaction closed on June 14, 2011.
Gumbiner Savett Inc., in Santa Monica, Calif., expressed
substantial doubt about ProElite's ability to continue as a going
concern, following its audit of the Company's financial statements
as of and for the years ended Dec. 31, 2008, and 2007. The
independent auditors noted that the Company has suffered losses
from operations and negative cash flows from operations.
The Company reported a net loss of $55.6 million for the fiscal
year ended Dec. 31, 2008, compared with a net loss of
$27.1 million for the fiscal year ended Dec. 31, 2007.
As a result of the decision to discontinue operations, the Company
did not have any revenues, cost of revenue, and gross profit for
the fiscal years ended Dec. 31, 2008, and 2007.
At Dec. 31, 2008, the Company's balance sheet showed $2.3 million
in total assets, $11.8 million in total liabilities, and a
shareholders' deficit of $9.5 million.
ProElite notified the U.S. Securities and Exchange Commission
that it requires additional time to complete the financial
statements for the fiscal quarter ended Sept. 30, 2011, and
cannot, without unreasonable effort and expense, file its Form 10-
Q on or before the prescribed filing date. The Company expects to
obtain all required data and complete the financial statements
within the next several days and, as a result, expects to file the
Form 10-Q within five days after the prescribed filing date.
PROQUEST LLC: Moody's Rates $190-Mil. Credit Facility 'Ba3'
-----------------------------------------------------------
Moody's Investors Service assigned a Ba3 rating to ProQuest LLC's
proposed $190 million senior secured credit facility and changed
the company's Outlook to Stable from Negative. The company's B3
Corporate Family Rating (CFR) and Probability of Default Rating
(PDR) were affirmed, as well as the Caa1 rating on its $275
million senior notes due 2018. The new credit facility, consisting
of a $150 million 6-year Term Loan B and a $40 million 5-year
Revolver, will be used to refinance the company's existing Term
Loan and Revolver (approximately $111.6 outstanding as of December
31, 2011) with the remaining balance (net of transaction fees) to
be held in cash and used for general corporate purposes or future
acquisitions. Ratings on the existing facility will be withdrawn
upon close of the facility. The change in outlook to Stable
assumes the proposed transaction is completed as planned.
A summary of the rating actions are listed below:
Issuer: ProQuest LLC
Corporate Family Rating, Affirmed B3
Probability of Default Rating, Affirmed B3
$150 million Senior Secured Term Loan B, Assigned Ba3
(LGD-2, 16%)
$40 million Senior Secured Revolver, Assigned Ba3 (LGD-2, 16%)
$275 million Senior Unsecured Notes, Affirmed Caa1 (LGD rating
changed to LGD-5, 72% from LGD-4, 69%)
Outlook is changed to Stable from Negative.
Rating Rationale
ProQuest's B3 CFR reflects the company's high adjusted leverage of
6.8x (pro-forma for the proposed transaction and incorporating
Moody's standard adjustments, as well as expensing content and
software costs instead of capitalizing them), continued pressure
on its margins driven by heavy investment in a significant ongoing
platform consolidation initiative, as well as a challenging
economic environment constraining sales to corporations,
government organizations and public libraries. Moody's expects
leverage will decline modestly over the rating horizon driven by a
slight improvement in EBITDA margin, but still remain in the mid-
to-low 6x range, positioning the company in the B3 category. There
is an elevated chance that a minority equity holder may exit the
transaction in the future as its equity put rights become
effective in February 2014.
The company's ratings are supported by a large subscription base
in the library reference market with extensive content databases
sold to libraries, corporations and government organizations, as
well as high renewal rates and a reoccurring stream of revenues.
Moody's also believes that expenses will remain elevated until its
platform integration is largely completed by the end of 2013. In
addition, the highly competitive nature of the industry and the
likelihood of elevated spending to maintain a competitive product
offering could partially offset the benefit of the platform
consolidation.
The change in the company's Outlook to Stable from Negative
reflects the extension of the maturity profile of its secured
debt, an improved liquidity profile, and expected cushion of
compliance with its financial covenants. These improvements are
partially offset by an increase in the Term Loan balance of $38
million from current levels.
ProQuest's liquidity profile, pro-forma for the proposed
transaction, will benefit from an additional $34 million in cash
(after transaction expenses) as well as full availability under
the company's new $40 million revolver. Moody's expects free cash
flow to be positive, but modest, in the low-to-mid teen range
including the incremental interest expense from the upsized term
loan and higher interest rates (around $4 - $5 million annually).
Although the terms of the credit facility have not been finalized,
Moody's expects covenant levels to be set with a 25% cushion and
do not anticipate compliance concerns over the rating horizon.
The company's Stable Outlook reflects Moody's view that leverage
will decline modestly over the next 18 -- 24 months, along with
improvements to ProQuest's EBITDA margin and liquidity profile,
positioning the company in the B3 rating category.
Moody's would consider an upgrade if ProQuest is able to
meaningfully reduce spending, improve EBITDA margins, and pay down
debt resulting in sustained leverage below 5.25x.
Ratings could experience downward pressure if leverage remains
above 6.75x due to a continuation of challenging operating trends,
an inability to reduce expenses, particularly from ongoing costs
associated with the platform migration, or from a meaningful
increase in the loss of customer subscriptions.
ProQuest's ratings were assigned by evaluating factors that
Moody's considers relevant to the credit profile of the issuer,
such as the company's (i) business risk and competitive position
compared with others within the industry; (ii) capital structure
and financial risk; (iii) projected performance over the near to
intermediate term; and (iv) management's track record and
tolerance for risk. Moody's compared these attributes against
other issuers both within and outside ProQuest's core industry and
believes ProQuest's ratings are comparable to those of other
issuers with similar credit risk. Other methodologies used include
Loss Given Default for Speculative-Grade Non-Financial Companies
in the U.S., Canada and EMEA published in June 2009.
Headquartered in Ann Arbor, Michigan, ProQuest LLC aggregates,
creates, and distributes academic and news content serving
academic, corporate and public libraries worldwide. Cambridge
Information Group (CIG) acquired the ProQuest Information and
Learning (PQIL) business of Voyager Learning Company (fka ProQuest
Company) in February 2007 and merged it with its Cambridge
Scientific Abstracts, Limited Partnership (CSA) business to form
ProQuest. In conjunction with the transaction, ABRY Partners
invested $63 million for a 20% stake in ProQuest with CIG
contributing CSA for the remaining 80% voting interest and a cash
distribution. Annual revenue as of December 31, 2011 was
approximately $499 million.
PROQUEST LLC: S&P Rates New $190MM 1st Lien Credit Facilities 'B+'
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned Ann Arbor, Mich.-based
ProQuest LLC's proposed $150 million term loan B due 2018 and $40
million revolver due 2017 its issue-level rating of 'B+' (two
notches higher than the 'B-' corporate credit rating on the
company). "We also assigned the proposed debt a recovery rating of
'1', indicating our expectation of very high (90%-100%) recovery
for lenders in the event of a payment default," S&P said.
"At the same time, we affirmed our 'B-' corporate credit rating on
the company, along with all related issue ratings on the company's
debt. The rating outlook is negative," S&P said.
"The transaction adds flexibility to accommodate some revenue
volatility and technology risk associated with the platform
migrations," said Standard & Poor's credit analyst Chris
Valentine. "Upon closing of the deal, we would likely revise our
rating outlook on the company to stable from negative."
"The 'B-' corporate credit rating reflects our view that operating
performance will likely remain weak over the near term, which
could result in deteriorating credit measures and liquidity
pressure," S&P said.
"Many of ProQuest's corporate and government clients are facing
significant budgetary pressure and have reduced their budget
allocations for libraries, resulting in an unfavorable operating
outlook for the company. In our view, ProQuest's business risk
profile is 'weak' because of mature and, in some cases,
unfavorable fundamentals of key end markets. We view the company
as having a 'highly leveraged' financial risk profile because
of its history of debt-financed acquisitions and debt-financed
distributions to its owners," S&P said.
"ProQuest is a content provider to more than 12,000 academic,
government, corporate, and public libraries. The company converts
proprietary information from publishers into electronically
accessible databases. ProQuest's end markets are relatively
mature, and growth is likely to require acquisitions and
product/geographical expansion, which entail significant risk. The
company derives the majority of its revenues from academic
libraries, followed by corporate and government customers, and
public and school libraries. This makes its revenue stream
susceptible to pervasive budget pressures, which we believe will
continue. Competition within the industry is intense, and pricing
increases generally have been limited to an inflationary pace,"
S&P said.
"On the positive side, demand for the company's products
(especially from academic libraries) has historically been fairly
steady. During the 2009 recession, the company did not raise its
prices on most products, but its operating performance remained
relatively stable," S&P said.
"Many of ProQuest's corporate and government clients are facing
significant budgetary pressure and have reduced their budget
allocations for libraries. Additionally, ProQuest's technology
platform migration is consuming more time and resources than
planned, contributing to higher costs and EBITDA pressure.
We believe cost pressure from the technology platform migration
could persist through the first half of 2012. Mature growth
prospects, pressure on public funding, and a highly competitive
market all remain key factors in performance. As a result, under
our base-case scenario, we expect flat to modestly positive
organic revenue and EBITDA growth in 2012. If the technology
platform migration is successful, EBITDA could modestly exceed our
expectations," S&P said.
REAL ESTATE ASSOCIATES: Incurs $861,000 Net Loss in 2011
--------------------------------------------------------
Real Estate Associates Limited VII filed with the U.S. Securities
and Exchange Commission its annual report on Form 10-K disclosing
a net loss of $861,000 on $0 of revenue in 2011, compared with net
income of $171,000 on $0 of revenue in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $1.23 million
in total assets, $21.37 million in total liabilities, and a
$20.14 million total partners' deficit.
For 2011, Ernst & Young LLP, in Greenville, South Carolina,
expressed substantial doubt about the Partnership's ability to
continue as a going concern. The independent auditors noted that
the Partnership continues to generate recurring operating losses.
In addition, notes payable and related accrued interest totaling
approximately $16,164,000 are in default due to non-payment.
A copy of the Form 10-K is available for free at:
http://is.gd/KJaGQM
About Real Estate Associates
Real Estate Associates Limited VII is a limited partnership which
was formed under the laws of the State of California on May 24,
1983. On February 1, 1984, the Partnership offered 2,600 units
consisting of 5,200 limited partnership interests and warrants to
purchase a maximum of 10,400 additional limited partnership
interests through a public offering managed by E.F. Hutton Inc.
The Partnership received $39,000,000 in subscriptions for units of
limited partnership interests (at $5,000 per unit) during the
period from March 7, 1984 to June 11, 1985.
The Partnership will be dissolved only upon the expiration of 50
complete calendar years -- December 31, 2033 -- from the date of
the formation of the Partnership or the occurrence of various
other events as specified in the Partnership agreement. The
principal business of the Partnership is to invest, directly or
indirectly, in other limited partnerships which own or lease and
operate Federal, state and local government-assisted housing
projects.
The general partners of the Partnership are National Partnership
Investments Corp., a California Corporation, and National
Partnership Investments Associates II. The business of the
Partnership is conducted primarily by NAPICO, a subsidiary of
Apartment Investment and Management Company, a publicly traded
real estate investment trust.
The Partnership holds limited partnership interests in 11 local
limited partnerships as of both March 31, 2010, and December 31,
2009. The Partnership also holds a general partner interest in
Real Estate Associates IV, which, in turn, holds limited
partnership interests in nine additional Local Limited
Partnerships; therefore, the Partnership holds interests, either
directly or indirectly through REA IV, in twenty (20) Local
Limited Partnerships. The general partner of REA IV is NAPICO.
The Local Limited Partnerships own residential low income rental
projects consisting of 1,387 apartment units at both March 31,
2010, and December 31, 2009. The mortgage loans of these projects
are payable to or insured by various governmental agencies.
REAL ESTATE ASSOCIATES: Assigns Interests in Ark. City & Oakview
----------------------------------------------------------------
Real Estate Associates Limited VII owns a 99% limited partnership
interest in Arkansas City Apartments. Arkansas City owns a 16-
unit apartment complex located in Arkansas City, Arkansas.
Real Estate Associates entered into a Third Amendment to Amended
and Restated Agreement and Certificate of Limited Partnership,
which was effective March 27, 2012, with David B. Gibson III, and
O.L. Puryear and Sons Construction Co. Inc., relating to the
transfer of the limited partnership interest held by the
Partnership in Arkansas City for a total price of $1,500. The
Partnership's investment balance in Arkansas City was zero at
Sept. 30, 2011.
The Partnership also owns a 99% limited partnership interest in
Oakview Apartments, Limited Partnership. Oakview owns a 32-unit
apartment complex located in Monticello, Arkansas. The
Partnership entered into a Third Amendment to Amended and Restated
Agreement and Certificate of Limited Partnership, which was
effective March 27, 2012, with David B. Gibson III, O.L. Puryear
and Sons Construction Co. Inc., and Professional Counseling
Service, Inc., relating to the transfer of the limited partnership
interest held by the Partnership in Oakview for a total price of
$1,500. The Partnership's investment balance in Oakview was zero
at Sept. 30, 2011.
Pursuant to the terms of the Arkansas City and Oakview Agreements,
on March 27, 2012, the Partnership assigned its limited
partnership interests in Arkansas City and Oakview to the Assignee
effective as of March 27, 2012, and received net proceeds of
$3,000.
A copy of the Form 8-K is available for free at:
http://is.gd/umauIC
About Real Estate Associates
Real Estate Associates Limited VII is a limited partnership which
was formed under the laws of the State of California on May 24,
1983. On February 1, 1984, the Partnership offered 2,600 units
consisting of 5,200 limited partnership interests and warrants to
purchase a maximum of 10,400 additional limited partnership
interests through a public offering managed by E.F. Hutton Inc.
The Partnership received $39,000,000 in subscriptions for units of
limited partnership interests (at $5,000 per unit) during the
period from March 7, 1984 to June 11, 1985.
The Partnership will be dissolved only upon the expiration of 50
complete calendar years -- December 31, 2033 -- from the date of
the formation of the Partnership or the occurrence of various
other events as specified in the Partnership agreement. The
principal business of the Partnership is to invest, directly or
indirectly, in other limited partnerships which own or lease and
operate Federal, state and local government-assisted housing
projects.
The general partners of the Partnership are National Partnership
Investments Corp., a California Corporation, and National
Partnership Investments Associates II. The business of the
Partnership is conducted primarily by NAPICO, a subsidiary of
Apartment Investment and Management Company, a publicly traded
real estate investment trust.
The Partnership holds limited partnership interests in 11 local
limited partnerships as of both March 31, 2010, and December 31,
2009. The Partnership also holds a general partner interest in
Real Estate Associates IV, which, in turn, holds limited
partnership interests in nine additional Local Limited
Partnerships; therefore, the Partnership holds interests, either
directly or indirectly through REA IV, in twenty (20) Local
Limited Partnerships. The general partner of REA IV is NAPICO.
The Local Limited Partnerships own residential low income rental
projects consisting of 1,387 apartment units at both March 31,
2010, and December 31, 2009. The mortgage loans of these projects
are payable to or insured by various governmental agencies.
The Partnership reported a net loss of $861,000 on $0 of revenue
in 2011, compared with net income of $171,000 on $0 of revenue in
2010.
The Company's balance sheet at Dec. 31, 2011, showed $1.23 million
in total assets, $21.37 million in total liabilities and a $20.14
million total partners' deficit.
For 2011, Ernst & Young LLP, in Greenville, South Carolina,
expressed substantial doubt about the Partnership's ability to
continue as a going concern. The independent auditors noted that
the Partnership continues to generate recurring operating losses.
In addition, notes payable and related accrued interest totaling
approximately $16,164,000 are in default due to non-payment.
RICKY MURRAY: Bankr. Court Says Chapter 11 Plan Not Feasible
------------------------------------------------------------
Bankruptcy Judge Stephani W. Humrickhouse denied confirmation of
the Chapter 11 plan of reorganization filed by Ricky and Connie
Murray, saying the Plan is not feasible as required by 11 U.S.C.
Sec. 1129(a)(11). The bankruptcy administrator and Branch Banking
and Trust Company objected to the Plan.
Ricky and Connie Murray are members and principals of three North
Carolina limited liability companies engaged in the business of
owning and renting real estate, as well as a corporation known as
Lisa Dee's Florist, Inc. Beginning in 2004 and continuing with
additional transactions in 2006 and 2008, the debtors and Related
Entities entered into loan agreements with BB&T wherein the
debtors and Related Entities executed promissory notes and
guaranty agreements in favor of BB&T. The transactions included
the execution of deeds of trust, security agreements, and
assignments of rents which granted to BB&T a security interest in
real property owned by the Related Entities as well as rents
issuing from those properties. Two of the limited liability
companies were administratively dissolved by the North Carolina
Secretary of State in February 2009. The debtors and Related
Entities subsequently defaulted on their loan obligations, and in
September 2010, BB&T initiated foreclosure proceedings.
On Dec. 1, 2010, the day of the foreclosure sale, the Related
Entities transferred to the Murrays all of the Related Entities'
interests in the real property subject to BB&T's security
interests. The Murrays filed a chapter 11 petition on Dec. 10,
2010. The Murrays subsequently and successfully argued that the
value of BB&T's collateral would be maximized if they continued in
their businesses ventures and that their limited income from other
sources (the female debtor's employment and the male debtor's
operation of a florist shop) would not provide sufficient cash
flow to allow them to continue business operations, such that the
use of rents was crucial. Because continuation of the businesses
caused the debtors to incur maintenance and operating expenses,
the court, in an order entered on May 24, 2011, allowed the
debtors to use cash collateral -- i.e., the rents -- to pay for
operational and other expenses, including management fees to the
debtors, insurance, supplies, utilities, and taxes. The order
also provided that adequate protection payments be made to BB&T.
The Murrays filed their Chapter 11 plan and disclosure statement
on April 8, 2011, and an amended plan on Aug. 23, 2011. BB&T, the
Murrays' largest secured creditor, objected to the treatment of
both its secured and unsecured claims under the debtors' plan.
BB&T argued primarily that the plan lacked feasibility, that its
terms were inequitable, and that it did not provide BB&T with the
indubitable equivalent of its secured claim. The bankruptcy
administrator also objected to confirmation, stating that the
Murrays were unable to satisfy 11 U.S.C. Sec. 1129(a)(15)(B) with
respect to the extent and use of their disposable income over the
duration of the plan.
A copy of the Court's March 27, 2012 Order is available at
http://is.gd/Lu9qESfrom Leagle.com.
Knightdale, North Carolina-based Lisa Dee's Florist, Inc., filed
for Chapter 11 bankruptcy (Bankr. E.D.N.C. Case No. 11-04929) on
June 27, 2011. George M. Oliver, Esq., at Oliver & Friesen Cheek,
PLLC. Lisa Dee's Florist estimated $50,001 to $100,000 in assets
and $1 million to $10 million in debts. The petition was signed
by Ricky V. Murray, president.
Ricky Verlin Murray and Connie Broughton Murray filed for Chapter
11 bankruptcy (Bankr. E.D.N.C. Case No. 10-10143) on Dec. 10,
2010.
ROSEMONT COPPER: Concealed Corporate Bankruptcy of 2 Officers
-------------------------------------------------------------
A formal complaint filed with the Arizona Corporation Commission
alleging Rosemont Copper, a wholly owned subsidiary of Augusta
Resource Corporation, repeatedly submitted false statements that
concealed a corporate bankruptcy involving two of Rosemont's top
officers.
Arizona law requires companies to affirmatively disclose whether
its officers or directors have ever been subject to corporate
bankruptcy proceedings. Knowingly filing false statements on the
disclosure forms is a felony criminal offense in Arizona and
provides grounds for the state to dissolve the company.
"For the past seven years, starting with its initial application,
Rosemont Copper filed statements falsely asserting that none of
its officers or directors had been an officer of another company
placed into bankruptcy," said Vince Rabago, a Tucson attorney and
former Arizona prosecutor.
Public information and Canadian securities records reveal that key
Rosemont officers -- Donald B. Clark and Richard W. Warke --
served as officers of West Coast Plywood Company Ltd., a company
placed into bankruptcy in Canada on July 27, 1995. Warke's and
Clark's other companies disclosed the West Coast Plywood
bankruptcy to Canadian securities regulators in May 2005. Just
one month later, Rosemont Copper filed its incorporation papers in
Arizona, failing to disclose that bankruptcy.
"We know they're not telling the truth in Arizona," Rabago said,
"because the bankruptcy was acknowledged in corporate filings
elsewhere. What else are they hiding?"
Rabago filed the complaint on behalf of Save the Scenic Santa
Ritas, Inc. (SSSR) a coalition comprised of local businesses,
organizations, and individuals opposed to Rosemont's plans for a
massive open-pit copper mine in the Santa Rita Mountains near
Tucson.
Augusta Resource is a publicly traded company in the United States
and Canada. Warke is chairman of Augusta Resource and Clark is on
the board of directors. Rosemont is seeking regulatory approvals
to develop a massive open-pit copper mine on private and public
land in the Santa Rita Mountains.
This complaint follows two earlier complaints filed by SSSR that
asked U.S. and Canadian securities regulators to investigate
alleged violations of securities laws in both countries. These
complaints focused on Augusta Resource's failure to disclose
Warke's personal bankruptcy and an insider trading settlement
agreement on securities disclosure forms.
RYERSON HOLDINGS: S&P Affirms 'B-' Corporate Credit Rating
----------------------------------------------------------
Standard & Poor's Ratings Services revised its rating outlook on
Chicago-based steel processor Ryerson Holding Corp. (Ryerson) to
stable from negative. "At the same time, we affirmed our existing
ratings, including the 'B-' corporate credit rating, on the
company," S&P said.
"The rating on Ryerson reflects the combination of what we
consider to be the company's 'highly leveraged' financial risk
profile and 'vulnerable' business risk profile," said Standard &
Poor's credit analyst Maurice Austin. "These assessments take into
account the company's high debt leverage and thin interest
coverage, ongoing difficult operating conditions, low margins
relative to some of its peers, and participation in the highly
cyclical and volatile steel industry. Still, we expect its near-
term liquidity position to remain adequate to meet its obligations
despite the likelihood that the company will draw on its revolving
credit facility as demand improves and increases inventory to
service customers."
"Under our base case scenario, we expect volumes and prices to
continue improving during the next few quarters as end-market
demand improves, resulting in better operating performance. We
expect 2012 EBITDA to be about $190 million (compared with $178
million in 2011), rising to more than $200 million in 2013,
reflecting improvement in demand and pricing in tandem with a
gradual increase in end markets as the general economy expands.
With our expectations of EBITDA cash interest coverage of about
3.5x in 2012 and 2013, we estimate that the company's debt to
EBITDA in both years will be below 9.5x--a level we consider weak
for the rating. However, we believe that liquidity is adequate to
meet any near-term financial obligations," S&P said.
"Ryerson's operations are highly cyclical and working-capital
intensive, which results in a high degree of volatility in
profitability and cash flow. The company's operating margins
(before depreciation and amortization) of about 3% are lower than
those of some other service centers, which typically average in
the mid- to high-single digits. This difference is attributable to
Ryerson's inventory mix, which has been skewed towards lower-
margin products, and to its customer mix. Historically, about 60%
of the product mix has been flat metal products. Ryerson would
like to increase its sales of long and plate metal products, which
were about 35% of its product mix in 2011. These goods have higher
margins and more stable pricing. Also, about 50% of sales are
contractual in nature and generate lower margins than
transactional business. The company would like to increase its
percentage of higher-margin transactional business as market
demand improves," S&P said.
"The outlook is stable. We expect Ryerson's operating performance
to continue to gradually improve into 2012--in line with a
moderate economic recovery and increased end-market demand," Mr.
Austin continued. "As a result, we expect credit measures to
remain in line with the current rating, with debt to EBITDA
slightly below 9.5x."
A negative rating action could occur if operating performance were
to deteriorate from poor execution of management's strategic
direction or if the company's ABL availability declines--
specifically, to less than $125 million.
"We could take a positive rating action if prices and volumes were
to continue to increase, resulting in better operating performance
and much stronger credit measures, for example, if debt to EBITDA
were to strengthen to less than 6x. This could occur if a there is
a sustainable improvement in margins," S&P said.
SAINT VINCENTS: Richard S. Toder Appointed as Mediator
------------------------------------------------------
The Hon. Cecelia G. Morris of the U.S. Bankruptcy Court for the
Southern District of New York issued on March 16, 2012, an order
appointing Richard S. Toder as mediator to conduct a non-binding
mediation concerning the Westchester allocation issues in Saint
Vincents Catholic Medical Centers of New York, et al.'s bankruptcy
case.
Upon the request of the parties on the record at the status
conference on March 8, 2012, and the Court having determined that
the appointment of a mediator to assist the parties in resolving
disputes in connection with the allocation of the net sale
proceeds received by the estate of the Debtors from the sale of
the behavioral health assets, as reported by the Troubled Company
Reporter on Oct. 12, 2010, is in the best interests of the
Debtors, their estates, creditors and stakeholders.
Parties to the Mediation are: (a) the Debtors, (b) the Official
Committee of Unsecured Creditors, (c) Sun Life Assurance Company
of Canada, and (d) the Med Mal Trust Monitor.
The costs of the Mediation will be shared equally by the estates,
Sun Life and the Med Mal Trust Monitor and will be payable upon
submission of invoices from the Mediator.
The initial Mediation conference will occur at a time and place
designated by the Mediator. Unless otherwise directed by the
Mediator, at least one principal of each Mediation Party, or of a
claim or interest holder for which a Mediation Party is an agent,
with authority to make a decision binding upon such person or
entity, will be present at each session of the Mediation. In the
case of the Committee, only one member (other than the Med Mal
Trust Monitor) designated and authorized to negotiate and settle
on behalf of the Committee shall be required to be present at each
session of the Mediation.
The Mediator will deliver a letter to the Court stating whether
(a) a resolution of issues subject to the Mediation has been
reached, (b) a resolution of issues subject to the Mediation
cannot be reached, or (c) the Mediator believes the Mediation
should continue in order to reach a resolution of the issues
subject to the Mediation. The Status Report need not be filed
with the Court. Unless otherwise agreed in writing by the
Mediation Parties and the Mediator, if the final report has not
been filed, the Mediation Parties will appear before the Court at
the date and time Court will direct for a status conference.
About Saint Vincents
Saint Vincents Catholic Medical Centers of New York, doing
business as St. Vincent Catholic Medical Centers --
http://www.svcmc.org/-- was anchored by St. Vincent's Hospital
Manhattan, an academic medical center located in Greenwich Village
and the only emergency room on the Westside of Manhattan from
Midtown to Tribeca, St. Vincent's Westchester, a behavioral health
hospital in Westchester County, and continuing care services that
include two skilled nursing facilities in Brooklyn, another on
Staten Island, a hospice, and a home health agency serving the
Metropolitan New York area.
Saint Vincent Catholic Medical Centers of New York and six of its
affiliates first filed for Chapter 11 protection on July 5, 2005
(Bankr. S.D.N.Y. Case Nos. 05-14945 through 05-14951).
St. Vincents Catholic Medical Centers returned to bankruptcy court
by filing another Chapter 11 petition (Bankr. S.D.N.Y. Case No.
10-11963) on April 14, 2010. The Debtor estimated assets of
$348 million against debts totaling $1.09 billion in the new
petition.
Although the hospitals emerged from the prior reorganization in
July 2007 with a Chapter 11 plan said to have "a realistic chance"
of paying all creditors in full, the bankruptcy left the medical
center with more than $1 billion in debt. The new filing occurred
after a $64 million operating loss in 2009 and the last potential
buyer terminated discussions for taking over the flagship
hospital.
Adam C. Rogoff, Esq., and Kenneth H. Eckstein, Esq., at Kramer
Levin Naftalis & Frankel LLP, represent the Debtor in its
Chapter 11 effort.
SAKS INC: Fitch Upgrades Issuer Default Rating to 'BB'
------------------------------------------------------
Fitch Ratings has upgraded its long-term Issuer Default Rating
(IDR) on Saks Incorporated to 'BB' from 'BB-'. Fitch has also
upgraded the issue rating of the company's $500 million secured
credit facility to 'BBB-' from 'BB+'. The Rating Outlook is
Stable.
The upgrades reflect Saks' improved operating results and credit
metrics. Saks' comparable store sales (comps) have continued
their strong growth momentum, up 9.5% in 2011 on top of the 6.4%
increase in 2010, given the overall recovery in luxury spending.
EBITDA for 2011 as of Jan. 28, 2012 has improved to $293 million,
exceeding pre-recession level of $245 million, even as total sales
remain 9% below peak levels.
Adjusted debt/EBITDAR improved to 3.1 times (x) in 2011 from 4.0x
in 2010 and 6.1x in 2009, while EBITDAR/interest+rents improved to
2.6x from 2.2x and 1.5x in 2010 and 2009, respectively. Fitch
expects leverage metrics to remain in the 2.9x-3.1x range over the
next two years, reflecting both improving profitability and debt
reduction. Saks is targeting an adjusted debt/EBITDAR leverage in
the range of 2.5x.
Fitch expects the luxury department stores to post comps growth of
3%-5% on average in 2012-2013, on top of a sales-weighted average
increase of 8% in 2011. Within this context, Fitch expects Saks
to generate comps in the mid-single-digit range, while EBIT margin
could decline modestly due to increasing investments over the next
two to three years in new merchandising systems and IT to
primarily support the company's omni-channel strategy.
Incorporated in the ratings is the lower sales productivity and
profitability of Saks stores relative to its two closest peers.
For 2011, Saks' average sales per square foot excluding its New
York flagship store improved to approximately $350 but still lags
the $430 level at Nordstrom Inc. (Nordstrom) and $480 at Neiman
Marcus, Inc. (Neiman Marcus). As a result, EBITDA margin at Saks
of 9.9% trails 13.4% at Neiman Marcus and 15.8% at Nordstrom.
Fitch does not expect Saks to completely close the gap with Neiman
Marcus, given the latter has superior real estate locations and
brand matrix within its markets. However, Saks' EBITDA margins
could reach the 11-12% range over time if the company can sustain
mid-to-high single-digit comps and healthy gross margins.
Saks' liquidity position remains strong with approximately $200
million in cash and $472 million available under its credit
facility as of Jan. 28, 2012. Fitch expects Saks to generate FCF
in the $70 million-$100 million range annually in 2012-2014, given
expected increase in capital expenditures to the $110 million-$120
million level in 2012(up from $68 million in 2011).
Saks has repaid approximately $280 million of debt over the past
five years, which has helped lower ongoing interest expense. The
next debt maturity is the $120 million 7.5% convertible notes due
in Dec. 2013. Fitch expects that the company will be able to
refinance or pay off the debt (although it is expected to be
converted into equity given that the convertible notes are deep in
the money) given its strong liquidity position. Given modest debt
maturities, Fitch expects Saks could direct excess cash flow
towards share buybacks.
The $500 million secured bank facility is rated two notches above
the IDR at 'BBB-' as the facility is secured by merchandise
inventories and certain third party accounts receivables. There
are no financial covenants in the facility as long as availability
exceeds $62.5 million. When availability falls below this
threshold, fixed charge coverage must be at least 1.0x.
The $350 million unsecured notes are rated 'BB'. Saks owns 67% of
its full-line square footage, including its Fifth Avenue New York
City store, which remains unencumbered.
Fitch has taken the following rating actions on Saks:
-- Long-term IDR upgraded to 'BB' from 'BB-'
-- $500 million secured credit facility upgraded to 'BBB-' from
'BB+';
-- Senior unsecured notes affirmed at 'BB'.
The Rating Outlook is Stable.
SCI ENGINEERED: Unable to Timely File Form 10-K
-----------------------------------------------
SCI Engineered Materials, Inc., filed a Form 12b-25 concerning its
inability to timely file all or any required portion of its 2011
Annual Report on Form 10-K with the U.S. Securities and Exchange
Commission. The company plans to file its 2011 Annual Report on
Form 10-K on or before April 16, 2012.
On March 20, 2012, the Ohio Air Quality Development Authority
approved an amendment to its 166 Direct Loan with the company
which included a waiver for non-compliance with a financial
covenant as of Dec. 31, 2011. The OAQDA amendment was filed with
the U.S. Securities and Exchange Commission on Form 8-K on
March 26, 2012.
Following receipt of the OAQDA amendment, the company initiated
discussions with the Ohio Department of Development seeking
approval to use funds from a separate loan with the ODOD to repay
a Promissory Note to a financial institution. As of March 30,
2012, the company's request to the ODOD is being actively
considered.
The events occurring in late March 2012 which included the OAQDA
loan amendment and subsequent discussions with the ODOD resulted
in unreasonable time and cost burdens for the company to file its
2011 Annual Report on Form 10-K by March 30, 2012.
About SCI Engineered Materials
SCI Engineered Materials, Inc. --
http://www.sciengineeredmaterials.com/-- manufactures ceramics
and metals for advanced applications such as photonics, thin film
solar, thin film batteries and semiconductors. SCI Engineered
Materials, Inc. is a global materials supplier with clients in
more than 40 countries.
SINO-FOREST: Initiates CCAA Proceeding for Sale/Restructuring
-------------------------------------------------------------
Sino-Forest Corporation has reached agreement with an ad hoc
committee of its noteholders on the material terms of a
transaction which would involve either a sale of the Company to a
third party or a restructuring under which the noteholders would
acquire substantially all of the assets of the Company, including
the shares of all of its direct subsidiaries which own, directly
or indirectly, all of the business operations of the Company. The
Ad Hoc Committee represents a significant portion of the holders
of the Company's 5% Convertible Senior Notes due 2013, 10.25%
Guaranteed Senior Notes due 2014, 4.25% Convertible Senior Notes
due 2016 and 6.25% Guaranteed Senior Notes due 2017.
The Company is initiating proceedings in the Ontario Superior
Court of Justice under the Companies' Creditors Arrangement Act
seeking approval for a Court supervised restructuring process to
implement the Transaction, including the immediate initiation of a
sale solicitation process and a stay of certain creditor claims.
Holders of approximately 40% of the aggregate principal amount of
Notes have executed a support agreement in which they have agreed
to support and vote for the Transaction. The Company will
continue to solicit additional Noteholder support for the
Transaction. Noteholders who wish to become "Consenting
Noteholders" and participate in the Early Consent Consideration
are permitted to do so until May 15, 2012, and further information
will be available on the website of the proposed monitor in the
CCAA proceedings, FTI Consulting Canada, Inc. at
http://cfcanada.fticonsulting.com/sfc.
Sino-Forest made the decision to initiate CCAA proceedings with
the unanimous authorization of its Board of Directors after
thorough consultation with its advisors and extensive
consideration of other alternatives.
"We believe the full value of our assets will only be achieved if
we are able to continue operating the business, and repair and
preserve relationships with our customers and suppliers. We
believe that the CCAA restructuring process is the best method to
secure our future and will allow the time and stability required
to normalize operations following the allegations made against the
Company by Muddy Waters, LLC. The Transaction we have negotiated
is indicative of the support of a significant portion of Sino-
Forest's Noteholders," said Judson Martin, Vice-Chairman and Chief
Executive Officer of Sino-Forest.
Sale Process
The Support Agreement provides that the Company will make an
application to the Court under the CCAA for an order approving a
sale solicitation process pursuant to which Sino-Forest's
financial advisor, Houlihan Lokey will solicit from third parties
offers to purchase substantially all of Sino-Forest's assets
(other than certain excluded assets).
Further details regarding the sale solicitation process will be
announced by the Company following approval of a sale process
order by the Court.
Restructuring Transaction
The Support Agreement provides that if the Company does not obtain
an acceptable offer resulting from the sale solicitation process,
the Company will implement a restructuring transaction in which
Sino-Forest will transfer substantially all of its assets, other
than certain excluded assets, to a newly formed entity owned and
controlled by the Noteholders in full and final settlement of all
claims of any person in respect of the Notes. The assets
transferred to Newco pursuant to the Restructuring Transaction
would include all of the shares of the Company's directly owned
subsidiaries and all of the receivables of the Company owed by its
direct and indirect subsidiaries, but exclude certain litigation
claims of the Company against third parties which will be
transferred to a litigation trust established to pursue such
claims, including claims against Muddy Waters, and US$20 million
in cash, which will be transferred to and used to fund the
Litigation Trust.
If the Restructuring Transaction occurs, the Support Agreement
provides that Junior Constituents (as defined in the Support
Agreement) will receive: (a) their pro rata share of non-
transferable "Contingent Value Rights" of Newco which will entitle
them to receive 15% of the value of Newco, if any, in excess of
U.S.$1.8 billion (being the approximate principal amount of the
Notes) plus accrued interest on the Notes up to and including the
CCAA filing date, for no additional consideration upon the
occurrence of a liquidity event of Newco within seven years
following the implementation date of the Restructuring
Transaction, and (b) a right to receive their pro rata share of
(i) 100% of any proceeds realized by the Litigation Trust for
claims against or settlements with Muddy Waters and its joint
actors, and (ii) the first $25 million of any proceeds realized
from claims against or settlements with third parties other than
Muddy Waters and its joint actors. If at the time proceeds are
available for distribution from the Litigation Trust, the
enterprise value of Newco is less than 85% of the principal amount
of the Notes plus accrued interest on the Notes up to and
including the CCAA filing date, 30% of the remaining proceeds
realized from claims against or settlements with third parties
other than Muddy Waters and its joint actors will be paid to
Noteholders and the remaining proceeds will be paid to Junior
Constituents. If the enterprise value of Newco at the time such
proceeds are available for distribution from the Litigation Trust
is more than the Threshold Amount, Junior Constituents will
receive 100% of the remaining proceeds realized from claims
against or settlements with third parties other than Muddy Waters
and its joint actors.
Many of the terms of the Restructuring Transaction remain to be
settled between the parties in definitive documentation. The
transactions contemplated by this press release will be subject to
various conditions, including relevant creditor, regulatory and
Court approvals. Sino-Forest continues to be subject to a cease
trade order of the Ontario Securities Commission which prohibits
trading in Sino-Forest's securities.
Additional details regarding the Transaction are contained in the
Support Agreement, a copy of which will be available at
www.sedar.com and on the proposed monitor's website at
http://cfcanada.fticonsulting.com/sfc. There can be no assurance
as to when or if a Transaction will be completed, or as to the
terms of any such Transaction.
Claim Against Muddy Waters, Carson Block and Others
The Company also announced that it has commenced an action in the
Court against Muddy Waters, Carson Block, and others, relating to
the allegations made against the Company by Muddy Waters, and
trading in Sino-Forest shares prior to and following the public
release on June 2, 2011, of a report prepared by Muddy Waters. The
action alleges that public statements made by Muddy Waters and
Carson Block were defamatory. The action seeks damages in the
amount of $4 billion and the recovery of profits made by Muddy
Waters and others in connection with the Muddy Waters report.
Cash Balance, Cash Flow Projections and Third Quarter Financial
Statements
As part of its negotiations with the Ad Hoc Committee, and
pursuant to confidentiality agreements, the Company provided to
certain Noteholders who were parties to such agreements,
information regarding the Company's cash balance as of March 2,
2012 and its expected cash flow needs for the remainder of 2012.
The confidentiality agreements require Sino-Forest to publicly
disclose this information by the sooner of the commencement of any
proceedings under the CCAA and April 30, 2012. The cash balance
and cash flow projections provided to such Noteholders are
attached to this news release as Schedule A.
The cash balance and cash flow projections are internal documents
prepared by management of the Company and are subject to the
assumptions set out in the projections. In addition, the cash
balance and cash flow projections were prepared as at March 2,
2012, and may no longer reflect the Company's current
circumstances or the current estimates of management of the
Company. Neither the Board of Directors of Sino-Forest nor any of
its committees has approved the cash balance or cash flow
projections. Sino-Forest does not, as a matter of course, publish
its budgets or make external projections or forecasts of its
anticipated financial position, expenditures, cash balances or
cash flows. The non-public information provided to the Ad Hoc
Committee was not prepared with a view to being disclosed publicly
and is included in this news release only because such information
was made available to the Ad Hoc Committee. Subject to applicable
securities laws, Sino-Forest does not intend to or anticipate that
it will, and disclaims any obligation to, furnish updated
projections or forecasts or similar forward looking information to
holders of securities issued by Sino-Forest or to include such
information in documents required to be filed with the applicable
Canadian securities regulatory authorities or otherwise make such
information publicly available.
Sino-Forest will also file with the Court today in the CCAA
proceedings, draft copies of its financial statements for the
three and nine months ended Sept. 30, 2011. The Draft Q3
Financial Statements will not be filed with the Canadian
securities regulators, but will be available on the website of the
proposed monitor at http://cfcanada.fticonsulting.com/sfc. Sino-
Forest cautions readers that the Draft Q3 Financial Statements are
in draft form only, and they do not and are not intended to comply
with the requirements of applicable securities law or Canadian
generally accepted accounting principles. As previously
disclosed, the Company cautions readers that its historical
financial statements, including the Draft Q3 Financial Statements,
may not be reliable and should not be relied upon for any purpose.
The Draft Q3 Financial Statements have been prepared by management
of the Company and have not been reviewed or approved by the Board
of Directors of the Company, any committee of the Board of
Directors or the Company's auditors.
Other Matters
Sino-Forest has determined that it will not be in a position to
file its audited annual financial statements for fiscal 2011 by
the March 30, 2012 deadline. Sino-Forest has made considerable
efforts to address issues identified by its Audit Committee and
the Independent Committee and by its external auditor, Ernst &
Young LLP, as requiring resolution in order for Sino-Forest to be
in a position to obtain an audit opinion in relation to its 2011
annual financial statements. However, as yet, Sino-Forest has not
been able to satisfactorily address those issues for audit
purposes for the same reasons previously disclosed. Sino-Forest
has also determined not to file its annual information form by the
prescribed deadline and will apply to the Court for postponement
of its annual meeting of shareholders for the duration of the CCAA
proceedings.
Sino-Forest also announced that Albert Ip has resigned for health
reasons from his position as Senior Vice President, Development &
Operations North-East and South-West China. Mr. Ip has agreed to
serve as a consultant to Sino-Forest on a part-time basis. "I
would like to thank Albert for his service to Sino-Forest," said
Judson Martin, Vice-Chairman and Chief Executive Officer of Sino-
Forest.
Houlihan is acting as financial advisor to Sino-Forest, Bennett
Jones LLP is acting as Canadian legal advisor to Sino-Forest and
Osler Hoskin & Harcourt LLP is acting as Canadian legal advisor to
the Board of Directors of Sino-Forest. The Ad Hoc Committee of
Noteholders is being advised by Moelis & Company, Goodmans LLP and
Hogan Lovells LLP.
About Sino-Forest Corp.
Sino-Forest Corporation -- http://www.sinoforest.com/-- is a
commercial forest plantation operator in China. Its principal
businesses include the ownership and management of tree
plantations, the sale of standing timber and wood logs, and the
complementary manufacturing of downstream engineered-wood
products. Sino-Forest also holds a majority interest in
Greenheart Group Limited, a Hong-Kong listed investment holding
company with assets in Suriname (South America) and New Zealand
and involved in sustainable harvesting, processing and sales of
its logs and lumber to China and other markets around the world.
Sino-Forest's common shares have been listed on the Toronto Stock
Exchange under the symbol TRE since 1995.
Sino-Forest disclosed mid-January 2012 that holders of a majority
in principal amount of its Senior Notes due 2014 and its Senior
Notes due 2017 have agreed to waive the default arising from the
Company's failure to release its 2011 third quarter financial
results on a timely basis.
Pursuant to the waiver agreements, the Company has agreed to make
the US$9.775 million interest payment on its 2016 Convertible
Notes that was due on Dec. 15, 2011. The Company also has agreed
to continue to pay when due interest on the Convertible Notes due
2013 and 2016 and on the Senior Notes due 2014 and 2017.
SINO-FOREST: Initiates Sale Solicitation Process
------------------------------------------------
Sino-Forest Corporation disclosed that a sale solicitation process
has been initiated with respect to the assets and operations of
the Company and its subsidiaries.
Houlihan Lokey, financial advisor to Sino-Forest has commenced
solicitation of interest from prospective strategic or financial
parties interested in participating in the Sale Process.
A notice of commencement of the Sale Process will be published in
The Globe & Mail and The Wall Street Journal seeking expressions
of interest in connection with a potential sale of substantially
all of the assets of the Company. The Notice was issued pursuant
to the terms of a sale process order (the "Sale Process Order") of
the Ontario Superior Court of Justice. The full text of the
Notice is set out below.
Take notice that pursuant to an order of the Ontario Superior
Court of Justice issued on March 30, 2012 under the Companies'
Creditors Arrangement Act, Sino-Forest Corporation obtained Court
approval to conduct a sale solicitation process.
Pursuant to the Sale Process, Houlihan Lokey is soliciting
proposals from prospective strategic and financial parties to
acquire substantially all of the property, assets and business of
Sino-Forest Corporation and its subsidiaries, other than certain
excluded assets. Sino-Forest Corporation is a leading commercial
forest plantation operator in China. Its principal businesses
include the ownership and management of tree plantations, the sale
of standing timber and wood logs, and the complementary
manufacturing of downstream engineered-wood products.
The Court also appointed FTI Consulting Canada Inc. as the Monitor
of Sino-Forest Corporation and confirmed Houlihan Lokey as its
financial advisor.
The timing and procedures governing the Sale Process, the terms of
participation of prospective purchasers, and the criteria for the
submission, evaluation and selection of bids are set out in the
Sales Process Order. FTI Consulting Canada Inc., the Court-
appointed Monitor in the CCAA proceedings, will supervise the Sale
Process in accordance with the terms of the Sale Process Order.
About Sino-Forest Corp.
Sino-Forest Corporation -- http://www.sinoforest.com/-- is a
commercial forest plantation operator in China. Its principal
businesses include the ownership and management of tree
plantations, the sale of standing timber and wood logs, and the
complementary manufacturing of downstream engineered-wood
products. Sino-Forest also holds a majority interest in
Greenheart Group Limited, a Hong-Kong listed investment holding
company with assets in Suriname (South America) and New Zealand
and involved in sustainable harvesting, processing and sales of
its logs and lumber to China and other markets around the world.
Sino-Forest's common shares have been listed on the Toronto Stock
Exchange under the symbol TRE since 1995.
Sino-Forest disclosed mid-January 2012 that holders of a majority
in principal amount of its Senior Notes due 2014 and its Senior
Notes due 2017 have agreed to waive the default arising from the
Company's failure to release its 2011 third quarter financial
results on a timely basis.
Pursuant to the waiver agreements, the Company has agreed to make
the US$9.775 million interest payment on its 2016 Convertible
Notes that was due on Dec. 15, 2011. The Company also has agreed
to continue to pay when due interest on the Convertible Notes due
2013 and 2016 and on the Senior Notes due 2014 and 2017.
SINO-FOREST: Obtains Initial CCAA Stay Order; FTI Is Monitor
------------------------------------------------------------
Sino-Forest Corporation has obtained an initial order from the
Ontario Superior Court of Justice for creditor protection pursuant
to the provisions of the Companies' Creditors Arrangement Act.
Under the terms of the Order, FTI Consulting Canada Inc. will
serve as the Court-appointed Monitor under the CCAA process and
will assist the Company in implementing its restructuring plan.
Gowling Lafleur Henderson LLP is acting as legal counsel to the
Monitor.
During the CCAA process, Sino-Forest expects its normal day-to-day
operations to continue without interruption. The Company has not
planned any layoffs and all trade payables are expected to remain
unaffected by the CCAA proceedings.
About Sino-Forest Corp.
Sino-Forest Corporation -- http://www.sinoforest.com/-- is a
commercial forest plantation operator in China. Its principal
businesses include the ownership and management of tree
plantations, the sale of standing timber and wood logs, and the
complementary manufacturing of downstream engineered-wood
products. Sino-Forest also holds a majority interest in
Greenheart Group Limited, a Hong-Kong listed investment holding
company with assets in Suriname (South America) and New Zealand
and involved in sustainable harvesting, processing and sales of
its logs and lumber to China and other markets around the world.
Sino-Forest's common shares have been listed on the Toronto Stock
Exchange under the symbol TRE since 1995.
Sino-Forest disclosed mid-January 2012 that holders of a majority
in principal amount of its Senior Notes due 2014 and its Senior
Notes due 2017 have agreed to waive the default arising from the
Company's failure to release its 2011 third quarter financial
results on a timely basis.
Pursuant to the waiver agreements, the Company has agreed to make
the US$9.775 million interest payment on its 2016 Convertible
Notes that was due on Dec. 15, 2011. The Company also has agreed
to continue to pay when due interest on the Convertible Notes due
2013 and 2016 and on the Senior Notes due 2014 and 2017.
SKILLED HEALTHCARE: S&P Gives 'B' on $100-Mil. Sr. Term Loan
------------------------------------------------------------
Standard & Poor's Ratings Services revised the existing issue-
level rating to 'B' from 'B+' and existing recovery rating to '3'
from '2' on Foothill Ranch, Calif.-based nursing home operator
Skilled Healthcare Group Inc.'s term loan due 2016. "The company
is increasing the term loan with a $100 million add-on; the
revision of the ratings reflects the increased amount of senior
secured debt outstanding in our simulated default scenario. The
'B' issue-level rating is equal to our 'B' corporate credit rating
on the company, in accordance with our notching criteria," S&P
said.
"Proceeds from the add-on term loan, along with a $35 draw on the
company's revolving credit facility will be used to repay the
outstanding $130 million of senior subordinated notes along with
fees associated with the transaction. At the same time, we are
affirming our 'B' corporate credit rating on the company. We
revised the outlook to positive to reflect our expectation that
the company will successfully mitigate recent Medicare rate cuts
and sustain an improved financial risk profile," S&P said.
"Our ratings on Skilled Healthcare Inc. reflect our assessment of
the company's business risk profile as weak, and the financial
risk profile as aggressive, according to our criteria," said
Standard & Poor's credit analyst John Bluemke. "We expect Skilled
to remain subject to significant reimbursement risk such as the
recent Medicare payment cut to nursing homes and adverse changes
to the reimbursement rules for group therapy services. We expect
Skilled's total revenue to increase by less than 1% for 2012,
primarily because of the full-year impact of the Medicare rate
cut, offset by an approximate 2% increase in Skilled's average
Medicaid rate along with the full-year effect of 2011 acquisitions
in the company's hospice and home health and rehabilitation
divisions."
SOUTHEASTERN MATERIALS: Bankr. Court Has Jurisdiction on DLI Case
-----------------------------------------------------------------
Bankruptcy Judge Thomas V. Waldrep, Jr., ruled that the Bankruptcy
Court has the authority to enter final judgments with regard to
certain causes of action and must propose findings of fact and
conclusions of law with regard to others in the lawsuit, W. Joseph
Burns, Trustee, v. Tony M. Dennis, Betty D. Lambert, Dennis-
Lambert Investments Limited Partnership, Chris C. Lambert, Maria
D. Dennis, Adv. No. 11-6033., 11-6034, 11-6035, 11-6036, 11-6037
(Bankr. M.D. N.C.). The Court can enter final judgments in all of
the fraudulent conveyance and preference causes of action asserted
by Trustee against Tony, Betty, and Chris. The Court can also
enter final judgments in all causes of action to recover estate
property from Tony and Betty. The Court can enter final judgments
in all causes of action to subordinate or disallow the claims of
Tony and Betty. The Court will submit proposed findings of fact
and conclusions of law in all other causes of action asserted
against Tony and Betty. Finally, the Court will submit proposed
findings of fact and conclusions of law in all causes of action
asserted against Maria and Dennis-Lambert Investments. A copy of
the Bankruptcy Court's March 27, 2012 Memorandum Opinion is
available at http://is.gd/BJTN8ufrom Leagle.com.
On Sept. 8, 2011, the Bankruptcy Court entered an order
instructing the parties to either file a written consent to the
Bankruptcy Court's authority to enter final judgment on the
asserted claims, or file briefs outlining their respective
positions as to whether and how the Supreme Court's ruling in
Stern v. Marshall, 564 U.S. ___, 131 S. Ct. 2594 (2011), affects
the Bankruptcy Court's authority to enter final judgment.
On May 19, 2011, the Bankruptcy Trustee filed five complaints
commencing these adversary proceedings against Betty D. Lambert,
Chris C. Lambert, Maria D. Dennis, Tony M. Dennis, and Dennis-
Lambert Investments. The Debtor is a closely-held corporation:
Betty and Tony, the Secretary and President of the Debtor, are
siblings. Chris, Betty's son, and Maria, Tony's daughter, are
employed by the Debtor. Together, Betty and Tony own 98% of the
Debtor. The remaining 2% is owned by Kay Dennis, Tony's spouse.
Betty's husband, Charles A. Lambert, is also alleged to have
participated in several of the business deals addressed by the
Complaint, although he is not named as a defendant. The Trustee
alleges that Betty, Tony, Charles, Kay, Maria, and Chris were
insiders of the Debtor because they were and are officers or
directors of the Debtor or relatives of officers and directors of
the Debtor.
The Trustee alleges that from Dec. 30, 2005 through Dec. 29, 2009,
the Debtor transferred $654,222 to Betty, $164,715 to Tony,
$102,836 to Chris, and $183,715 to Maria, allegedly without
consideration to the Debtor. Tony, Betty, and Chris filed proofs
of claim. The Trustee seeks to disallow Betty's and Tony's claims
but does not object to the claim filed by Chris. Neither Maria
nor DLI filed a proof of claim.
Southeastern Materials, Inc., manufactured wooden roof trusses,
shingles, and other roofing materials. It sought Chapter 11
protection (Bankr. M.D.N.C. Case No. 09-52606) on Dec. 30, 2009.
A copy of the Debtor's Chapter 11 petition is available at
http://bankrupt.com/misc/ncmb09-52606.pdfat no charge. On June
2, 2010, the Court appointed W. Joseph Burns as Chapter 11
trustee. On July 30, 2010, the case was converted to Chapter 7,
and W. Joseph Burns was appointed as the Chapter 7 trustee.
SOUTHERN SKY: Chapter 11 Filing to Cost Airport $850,000 Funding
----------------------------------------------------------------
Steve Wartenberg at The Columbus Dispatch reports that Direct
Air's recent bankruptcy filing will cost Rickenbacker Airport
$850,000 in federal funding and $13,000 in fees that the
struggling air-charter company owes the local airport.
According to the report, Direct Air had previously announced plans
to resume seasonal service from Rickenbacker to Myrtle Beach on
May 23, and to start a service from Rickenbacker to Lakeland,
Fla., on June 17. Those flights could have pushed the airport's
2012 total of outbound passengers past the 10,000 mark. That
would have increased the airport's federal capital-improvement
funding to $1 million from the current $150,000.
The report relates the U.S. Department of Transportation said
travelers can submit claims against a $200,000 bond that parent
Southern Sky was required to post. The agency said it is
investigating whether the carrier properly maintained an escrow
account for passenger fares as required for air-charter companies.
The Columbus Dispatch, citing report from Myrtle Beach Sun News,
says federal officials have requested that the airline's Chapter
11 bankruptcy proceedings be converted to a Chapter 7 liquidation
that would put an end to Direct Air.
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.
SOUTHERN SKY: Management Conducts Forensic Investigation
--------------------------------------------------------
SCNow reports that Direct Air said in a statement on March 29,
2012, that current management is conducting a comprehensive
forensic investigation regarding the management and operation of
the Company prior to the cancellation of charter flights on March
12 and the company's subsequent determination to file for Chapter
11 protection. Other relevant information is likely to be
produced in the course of the bankruptcy proceeding.
According to the report, Direct Air will address these and related
matters solely in the context of the bankruptcy proceedings and in
government investigations, with which the company says current
management is cooperating fully.
The report relates the statement said the current management and
majority owners of Direct Air strongly disagree with the claims
being made by former executives who are wrongly denying their
responsibility for the financial situation facing the company and
the damage caused to the company and its customers. In light of
the company's ongoing bankruptcy proceedings, neither Direct Air
or its advisors will respond to these or any other allegations
through the media.
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.
SPIRIT AEROSYSTEMS: S&P Retains 'BB' Corporate Credit Rating
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BBB-' issue
rating to Spirit AeroSystems Inc.'s planned $1.2 billion senior
secured credit facility, comprising a $650 million revolver
maturing in 2017 and a $550 million term loan maturing in 2019.
"The issue rating is two notches above our corporate credit rating
on Spirit. The recovery rating on the facility is '1', indicating
our expectation of very high recovery (90%-100%) in a payment
default scenario. The company will use proceeds from the loan to
refinance its existing $1.25 billion credit facility," s&p SAID.
"The 'BB-' issue rating and '5' recovery rating, indicating
expectations of modest (10%-30%) recovery, on the company's $600
million unsecured notes remain unchanged," S&P said.
"The corporate credit rating and outlook on Spirit reflect our
expectation that increasing levels of working capital and capital
expenditures to support new programs and increasing deliveries
will likely limit free cash flow generation in 2012. The ratings
also factor in risks associated with several programs currently in
development, which the company's credit protection measures,
better than average for the rating, partially offset. We assess
Spirit's business risk profile as 'fair' and its financial risk
profile as 'significant,'" S&P said.
RATINGS LIST
Spirit AeroSystems Inc.
Corporate credit rating BB/Stable/--
Ratings Assigned
Senior secured
$650 mil. revolver due 2017 BBB-
Recovery rating 1
$550 mil. term loan due 2019 BBB-
Recovery rating 1
STATE FAIR OF VIRGINIA: Trustee Plans Auction in May
----------------------------------------------------
The Associated Press reports a trustee plans to auction the
Caroline County property where the State Fair of Virginia Inc. has
been held since 2009 after continued losses and heavy debt forced
fair organizers to liquidate under federal bankruptcy law.
According to the report, the 360-acre Meadow Event Park site,
personal property and the State Fair of Virginia name and event-
operation rights will be up for sale in an attempt by creditors to
recover at least a portion of what they're owed. The secured
creditors' group provided more than $80 million in bond financing.
The report notes a Richmond auction house is working to solicit
bids and to schedule a foreclosure sale sometime in May. The
foreclosure sale marks the ending to the State Fair of Virginia's
efforts to move the 11-day event out of Richmond.
State Fair of Virginia Inc. -- http://www.statefair.com/-- owns
and operates a state fairgrounds facility known as the "The Meadow
Event Park" located in Doswell, Caroline County, Virginia. SFVA
filed for Chapter 11 bankruptcy (Bank. E.D. Va. Case No. 11-37588)
on Dec. 1, 2011. Jonathan L. Hauser, Esq., at Troutman Sanders
LLP, served as the Debtor's counsel.
The Debtor estimated assets of $10 million to $50 million and
estimated debts of $50 million to $100 million. Curry A. Roberts
signed the Petition as president.
The U.S. Trustee for Region 4 appointed five unsecured creditors
to serve on the Official Committee of Unsecured Creditors of State
Fair of Virginia Inc.
At the onset of the case, SFVA officials said they hope to emerge
on a better financial footing and to do so within 60 days to 90
days.
In March 2012, Lynn Tavenner, Esq., at Tavenner & Beran PLC, was
named interim trustee for the SFVA Inc. bankruptcy case. The
Bankruptcy Court converted the case to a Chapter 7 liquidation on
March 14.
SUPERMEDIA INC: Moody's Cuts Corporate Family Rating to 'Caa3'
--------------------------------------------------------------
Moody's Investors Service has changed the corporate family rating
(CFR) for SuperMedia Inc. to Caa3 from Caa1 based on Moody's view
that a debt restructuring is likely. Moody's expects ultimate
recoveries will be about 50%. Moody's ratings outlook for
SuperMedia remains negative.
Ratings Rationale
SuperMedia is attempting to reinvent its business by reducing its
reliance on print advertising through the development of online
and mobile directory service applications but Moody's has doubts
that the company will be able to transition its business away from
a reliance on print directories quickly enough to stabilize its
revenues and earnings and prevent a debt restructuring.
Moody's believes that revenues will continue to decline at a
double digit rate for the foreseeable future, leading to a steady
decline in free cash flow. SuperMedia's sales were down 16% year-
over-year for 4Q'11 while revenues fell by 18% in 2011. Continued
weakness in ad sales relative to spending in other print-based
channels and the overall advertising market suggests that the
cyclical recovery in client advertising spending is not
stabilizing revenue in the directory industry. Moody's thus
believes the structural challenges the directory industry faces
will remain severe and that the high fixed cost nature of
SuperMedia's business could lead to steep margin compression,
notwithstanding continued aggressive cost management and a modest
improvement in margins in 2011. The rating also reflects Moody's
view that additional distressed debt exchanges are likely in the
future. SuperMedia, since emerging from bankruptcy on December 31,
2009, has already undertaken two debt repurchases that Moody's
considered distressed exchanges.
SuperMedia has good liquidity, supported by $90 million in cash at
December 31, 2011 and the company continues to generate free cash
flow. The company requires minimal capital investment, well below
internally generated cash flows. And, SuperMedia can opt to
accrue, if fixed charge leverage is less than 1.25 times,
approximately 20% of interest as principal, offering additional
flexibility.
Rating Outlook
The negative outlook reflects Moody's view that demand for the
company's core yellow pages advertising products is in secular
decline and that SuperMedia's capital structure is unsustainable.
It is increasingly likely that the company will need to
restructure its financial obligations.
What Could Change the Rating - Down
Moody's would downgrade the CFR rating if revenue or EBITDA were
to fall below Moody's expectations, suggesting that recoveries
would be lower than 50%. Moody's would downgrade the PDR if the
company were to enter into another distressed exchange.
What Could Change the Rating - Up
A rating upgrade is deemed unlikely in the absence of an equity
raise that reduces debt levels to a more sustainable level.
SuperMedia's ratings were assigned by evaluating factors that
Moody's considers relevant to the credit profile of the issuer,
such as the company's (i) business risk and competitive position
compared with others within the industry; (ii) capital structure
and financial risk; (iii) projected performance over the near to
intermediate term; and (iv) management's track record and
tolerance for risk. Moody's compared these attributes against
other issuers both within and outside SuperMedia's core industry
and believes SuperMedia's ratings are comparable to those of other
issuers with similar credit risk.
SuperMedia Inc. ("SuperMedia"), headquartered in D/FW Airport,
Texas, is the second largest U.S. yellow pages publisher. The
company reported revenues of $1.6 billion for the twelve months
ended December 31, 2011.
Moody's has taken the following rating actions:
Issuer: SuperMedia Inc.
The following ratings were changed:
Corporate Family Rating, Caa3 from Caa1 prior
Probability of Default Rating, Caa3 from Caa2 prior
$1.7 billion Term Loan, Caa3 LGD3-49% from Caa1
LGD3-34% prior
The following ratings are unchanged:
Speculative Grade Liquidity, SGL 2
Outlook: Negative
T3 MOTION: Incurs $5.5 Million Net Loss in 2011
-----------------------------------------------
T3 Motion, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss of
$5.50 million on $5.29 million of net revenues in 2011, compared
with a net loss of $8.32 million on $4.68 million of net revenues
in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $5.02 million
in total assets, $2.74 million in total liabilities, and
$2.27 million in total stockholders' equity.
For 2011, KMJ Corbin & Company LLP, in Costa Mesa, California,
expressed substantial doubt about the Company's ability to
continue as a going concern. The independent auditors noted that
the Company has incurred significant operating losses and has had
negative cash flows from operations since inception, and at
Dec. 31, 2011, has an accumulated deficit of $54,886,297.
A copy of the Form 10-K is available for free at:
http://is.gd/fasQLf
About T3 Motion
Costa Mesa, Calif.-based T3 Motion, Inc., develops and
manufactures T3 Series vehicles, which are electric three-wheel
stand-up vehicles that are directly targeted to the public safety
and private security markets.
TEXTRON FINANCIAL: S&P Puts 'BB+/B' Issuer Credit Ratings on Watch
------------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB+/B' long- and
short-term issuer credit ratings on Textron Financial Corp. (TFC)
on CreditWatch with positive implications. "We also placed our
ratings on TFC's senior unsecured debt and junior subordinated
debt on CreditWatch positive," S&P said.
"The CreditWatch placement reflects our view that TFC's parent,
Textron Inc., has shown a consistent commitment to support TFC,
notwithstanding the considerable strain the finance company's
outsize losses have placed on its parent," said Standard & Poor's
credit analyst Brendan Browne. "In our view, that has enabled TFC
to greatly reduce its credit and liquidity risk to a point where
any additional support is likely to be very manageable for
Textron."
"Based on this, we believe that TFC may be a core subsidiary of
Textron," said Mr. Browne. "We plan to resolve the CreditWatch in
April, after we more fully assess the parent-subsidiary
relationship. Under our criteria, our ratings on a core or captive
subsidiary are the same as those on its parent."
"Textron (BBB-/Stable/A-3) has provided substantial equity support
to TFC since 2008, including $240 million as recently as January
2012, and it accounted for about a quarter of TFC's reported debt
at year-end 2011. That has allowed TFC to absorb $1.1 billion in
net losses in four years, to meet significant debt maturities, and
to remain in compliance with the terms of the support agreement
between Textron and TFC. (Certain TFC debt issues require the
parent to uphold the terms of the support agreement, which relate
to the subsidiary's net worth, earnings, and other matters)," S&P
said.
"In the process, TFC has substantially reduced its credit and
liquidity risk--more rapidly than we expected a year ago--and has
moved more toward acting simply as a captive finance company. In
2011, the subsidiary liquidated or wrote down its troubled
noncaptive managed receivables (including mortgages on golf
courses, developer loans, and large-ticket equipment leases) by
almost 60%. As of year-end 2011, we believe TFC had marked down
its noncaptive portfolio by roughly 40% from its unpaid principal
balance, net of the allowance for loan losses. The reported
noncaptive portfolio accounted for about 40% of TFC's receivables,
down from 54% in 2010. We expect the company to liquidate the
majority of the remaining noncaptive portfolio within three
years," S&P said.
"We still believe TFC could require some further parental support
to meet its 2013 debt maturities and to remain in compliance with
the TFC-Textron support agreement. For instance, without
additional support, the subsidiary could violate the support
agreement's fixed-charge covenant--one that essentially requires
its pretax earnings before interest expense to be at least 1.25x
its interest expense. Also, to meet its 2013 maturities without
support, TFC will need to further shrink its balance sheet through
asset liquidations or new debt issuance. However, any additional
required support, in our view, is likely to be very manageable for
Textron," S&P said.
THERAPEUTICSMD INC: Rosenberg Rich Raises Going Concern Doubt
-------------------------------------------------------------
TherapeuticsMD, Inc., filed on March 27, 2012, its annual report
on Form 10-K for the fiscal year ended Dec. 31, 2011.
Rosenberg Rich Baker Berman & Company, in Somerset, N.J.,
expressed substantial doubt about TherapeuticsMD, Inc.'s ability
to continue as a going concern. The independent auditors noted
that the Company has suffered a loss from operations of
approximately $5.4 million and had negative cash flow from
operations of approximately $5.0 million.
The Company reported a net loss of $12.9 million on $2.1 million
of revenues for 2011, compared with a net loss of $2.9 million on
$1.2 million of revenues for 2010.
The Company's balance sheet at Dec. 31, 2011, showed $1.4 million
in total assets, $3.1 million in total current liabilities, and a
shareholders' deficit of $1.7 million.
A copy of the Form 10-K is available for free at:
http://is.gd/HTCuo7
Boca Raton, Fla.-based TherapeuticsMD, Inc., is a specialty
pharmaceutical company focused on the sales, marketing and
development of branded and generic pharmaceutical and OTC products
primarily for the women's healthcare market. The Company's
products are designed to improve the health and well-being of
women from pregnancy through menopause while using information
technology to lower costs for the Patient, Physician and Payor.
THOR INDUSTRIES: Files Chapter 11 Petition in Greenville
--------------------------------------------------------
Lake City, Tennessee-based Thor Industries, LLC, filed a Chapter
11 petition (Bankr. E.D. Tenn. Case No. 12-50625) in Greenville on
March 30, 2012.
The Debtor disclosed $11.97 million in assets and $10.0 million in
liabilities as of the Chapter 11 filing. The Debtor owns the
property in Mountain Lake Marina & RV Resort in Campground Road,
Lake City, Tennessee, worth $11 million and securing an $8.52
million debt. The Debtor also owns a property Hickory Bluff
Marina, in Camden County, Georgia, worth $875,000 and securing a
$375,000 loan. A copy of the schedules filed with the petition is
available at http://bankrupt.com/misc/tneb12-50625.pdf
Tennessee State Bank is owed $8.1 million on a mortgage on the
Mountain Lake property.
According to the statement of financial affairs, gross income was
$1.32 million in 2010 and $340,000 in 2011.
A meeting of creditors under 11 U.S.C. Sec. 341(a) is scheduled
for April 30, 2012 at 11:30 a.m. Proofs of claim are due to be
filed with the bankruptcy court by July 30, 2012.
Dean B. Farmer, Esq., at Hodges, Doughty & Carson PLLC, in
Knoxville, Tennessee, serves as bankruptcy counsel to the Debtor.
TIMMINCO LIMITED: First Phase of Marketing Process Completed
------------------------------------------------------------
Timminco Limited and its wholly-owned subsidiary Becancour Silicon
Inc. provided an update on the Company's marketing process in
respect of the sale of its business and assets, in connection with
the proceedings commenced by the Company under the Companies'
Creditors Arrangement Act on Jan. 3, 2012.
The first phase of the marketing process is complete, with the
Company having received a number of non-binding Phase I Bids. The
Company, in consultation with the Monitor, has determined that
each of the parties that submitted Phase I Bids is a Qualified
Phase I Bidder and, as such, will be entitled to continue with
their due diligence investigations and negotiations with the
Company during the second phase of the marketing process.
Qualified Phase I Bidders have the opportunity to submit
irrevocable, binding bids by no later than 10:00 a.m. Eastern Time
on April 16, 2012.
About Timminco
Timminco produces silicon metal for the chemical (silicones),
aluminum and electronics/solar industries, through its 51%-owned
production partnership with Dow Corning, known as Quebec Silicon.
Timminco is also a producer of solar grade silicon, using its
proprietary technology for purifying silicon metal, for the solar
photovoltaic energy industry, through Timminco Solar, a division
of its wholly owned subsidiary Becancour Silicon.
Timminco Limited and its wholly-owned subsidiary, Becancour
Silicon Inc. on Jan. 2, 2012, commenced proceedings under the
Companies' Creditors Arrangement Act. Pursuant to the initial
order, FTI Consulting Canada Inc. has been appointed as monitor in
the CCAA proceedings.
TOWNSQUARE RADIO: S&P Assigns B Corp Credit Rating; Outlook Stable
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned Greenwich, Conn.-based
Townsquare Radio LLC its 'B' corporate credit rating. The rating
outlook is stable.
"We also assigned the company's $265 million senior unsecured
notes our 'B' issue-level rating (the same rating level as our 'B'
corporate credit rating on the company), with a recovery rating of
'4', indicating our expectation of average (30% to 50%) recovery
for lenders in the event of a payment default. We expect that the
issuer will use the net proceeds to refinance the existing debt of
its subsidiaries," S&P said.
"The 'B' rating on Townsquare reflects our expectation that,
despite high leverage, the company will be able to maintain
adequate liquidity over the intermediate term," said Standard &
Poor's credit analyst Jeanne Shoesmith.
"We view Townsquare's business risk profile as 'weak' because of
risks related to longer-term structural issues facing the radio
industry and the company's small market presence, which we believe
contributes to a lower EBITDA margin. We view Townsquare's
financial risk profile as 'highly leveraged,' based on its high
debt-to-EBITDA ratio of 5.9x (adjusted for operating leases, with
a present value of $15 million as of Dec. 31, 2011). Leverage
increases to 7.9x when the preferred equity at the holding company
is included," S&P said.
"Townsquare's 202 radio stations operate in 43 small-to-midsize
markets in the U.S. Although such markets have less competition
from large well-capitalized radio broadcasters, they offer smaller
total ad revenue and cash flow opportunities compared to top-100
markets, and typically attract considerably less national
advertising, a potential source of revenue diversification.
Townsquare's advertising revenue is highly vulnerable to economic
downturns. We believe that its business is subject to long-term
secular trends of fragmentation of listeners, increasing audience
engagement with Internet-based entertainment, and the migration of
advertising dollars online. The company's stations are diversified
across the Northeast, Midwest, South, Southwest, Mountain West,
and Pacific Northwest, providing some geographic diversity. No
state comprises more than 20% of net revenue. Nevertheless, in our
view, the company has limited growth potential because of its
focus on small markets, the mature prospects of the local radio
broadcasting business, and intensifying competition for audiences
and advertisers from traditional and nontraditional media," S&P
said.
"Under our base-case scenario, we expect that 2012 revenue will be
up in the low-single-digit percentage area and that EBITDA will
increase at a mid-single-digit pace. We expect a slight uptick in
political advertising revenue to largely offset low single-digit
declines in traditional radio advertising revenue. We forecast
that digital and live events related revenue will grow at a low-
double-digit percentage pace. However, these segments accounted
for a minority of 2011 revenues. We believe that the company's
EBITDA margin (23% for the 12 months ended Dec. 31, 2011) will
remain roughly flat in 2012," S&P said.
TRAINOR GLASS: Has Interim Access to $300,000 FMB DIP Facility
--------------------------------------------------------------
The Hon. Carol A. Doyle of the U.S. Bankruptcy Court for the
Northern District of Illinois authorized, on an interim basis,
Trainor Glass Company, dba Trainor Modular Walls, to access
postpetition financing to pay expenses pursuant to a budget, and
to use cash collateral of secured lender First Midwest Bank.
FMB is owed roughly $34 million in prepetition debt. It has
committed to provide up to $300,000 in additional financing.
A final hearing is set for April 10, 2012, at 10:30 a.m.
According to the Debtor, it needs to use cash collateral and incur
postpetition debt to prevent immediate and irreparable harm to its
estate. Access to such monies will also enhance the possibility
of maximizing the value of its estate.
Under the DIP agreement, the postpetition debt is priced at 9% per
annum, and will mature and be due payable in full by the Debtor on
the termination date. The termination date is the earlier to
occur of:
-- the date on which the lender provides written notice to the
Debtor's counsel and the Committee's counsel of the
occurrence and continuation of an event of default; and
-- April 12, 2012, if the final order is not entered in form
and substance satisfactory to the lender.
As adequate protection, the lender is granted replacement liens as
security for payment of the prepetition debt. The replacement
liens are (i) and will be in addition to the prepetition liens;
(ii) will be deemed properly perfected, valid and enforceable
liens without any further action by the Debtor; and (iii) will
remain in full force and effect notwithstanding any subsequent
conversion to Chapter 7 or dismissal of the case.
The DIP financing is subject to carve-out but no portion of the
carve-out may be used to pay any fees or expenses incurred by
the Debtor including the Debtor, any committee of the carve-out
professionals in connection with claims or cause of action adverse
to the lender's interests.
A full-text copy of the interim order is available for free at
http://is.gd/pOBdvh
About Trainer Glass
Trainor Glass Company, doing business as Trainor Modular Walls,
Trainor Solar, and Trainor Florida, filed for Chapter 11
bankruptcy (Bankr. N.D. Ill. Case No. 12-09458) on March 9, 2012.
The Hon. Carol A. Doyle oversees the case. David A. Golin, Esq.,
Michael L. Gesas, Esq., and Kevin H. Morse, Esq., at Arnstein &
Lehr LLP, serve as the Debtor's counsel. The Debtor estimated
both assets and debts of between $50 million and $100 million.
Trainor was founded in 1953 by Robert J. Trainor Sr. to pursue a
residential glass business in Chicago, Illinois. Trainor's
business model was focused on quality fabrication, design,
engineering, and installation of glass products and framing
systems in virtually every architectural application, including
(a) new construction, (b) green-building solutions, (c) building
rehabilitation, (d) storefronts and entrances, (e) tenant
interiors, and (f) custom-specialty work.
TRANS-LUX CORP: Delays Form 10-K for 2011
-----------------------------------------
Trans-Lux Corporation was unable to file its report on Form 10-K
for the year ending Dec. 31, 2011, within the prescribed time
period because of pending additional information necessary for
finalizing its Form 10-K.
About Trans-Lux Corporation
Norwalk, Conn.-based Trans-Lux Corporation (NYSE Amex: TLX) is a
designer and manufacturer of digital signage display solutions for
the financial, sports and entertainment, gaming and leasing
markets.
Trans-Lux reported a net loss of $7.03 million on $24.30 million
of total revenues for the year ended Dec. 31, 2010, compared with
a net loss of $8.79 million on $28.54 million of total revenues
during the prior year.
The Company also reported a net loss of $5.45 million on
$17.12 million of total revenues for the nine months ended Sept.
30, 2011, compared with a net loss of $5.25 million on
$18.73 million of total revenues for the same period a year ago.
The Company's balance sheet at Sept. 30, 2011, showed
$29.73 million in total assets, $35.31 million in total
liabilities, and a $5.58 million total stockholders' deficit.
As reported by the TCR on April 8, 2011, UHY LLP, in Hartford,
Connecticut, expressed substantial doubt about the Company's
ability to continue as a going concern. The independent auditors
noted that the Company has incurred significant recurring losses
from continuing operations and has a significant working capital
deficiency. In 2009, the Company had a loss from continuing
operations of $8.8 million and has a working capital deficiency of
$16.0 million as of Dec. 31, 2009. Furthermore, the Company is in
default of the indenture agreements governing its outstanding 9
1/2% Subordinated debentures and its 8 1/4% Limited convertible
senior subordinated notes so that the trustees or holders of 25%
of the outstanding Debentures and Notes have the right to demand
payment immediately.
UNIVERSAL FIDELITY: A.M. Best Cuts Finc'l. Strength Rating to 'B'
-----------------------------------------------------------------
A.M. Best Co. has downgraded the financial strength rating (FSR)
to B (Fair) from B+ (Good) and issuer credit rating (ICR) to "bb+"
from "bbb-" of Universal Fidelity Life Insurance Company
(Universal Fidelity Life) (Oklahoma City, OK). The outlook for
both ratings has been revised to stable from negative.
The rating actions reflect Universal Fidelity Life's significantly
lower operating results since 2008 and the decline in its absolute
capital and surplus, which resulted from higher expenses incurred
from the marketing of a new single premium whole life product,
investment in a new line of third-party administrative (TPA)
services and maturing business lines. Additionally, the company
is exposed to marketing and regulatory risks as its risk business
is concentrated in student accident insurance. A.M. Best believes
Universal Fidelity Life will be challenged to achieve its short-
term financial projections due to a highly competitive student
accident market, which may experience lower profit margins and
possible adverse impact from health care reform.
Universal Fidelity Life's implemented business improvement
initiatives in 2010-2011 included improved selection in its
student accident business, a significant reduction in general and
administrative expenses, a reduction in sales of its capital
intensive single premium whole life product and growth in its
ERISA TPA revenue.
Universal Fidelity Life markets primarily TPA services nationally
and student accident and life insurance products chiefly in the
south central United States. The company is currently focusing on
partnering with other carriers to market life and Medicare
supplement products, in addition to growing its TPA business.
UNIVERSAL SOLAR: Delays Form 10-K for 2011
------------------------------------------
Universal Solar Technology, Inc.'s annual report on Form 10-K for
the period ended Dec. 31, 2011, could not be filed within the
prescribed time period because the financial statements and
narrative required could not be completed without unreasonable
effort or expense.
About Universal Solar
Headquartered in Zhuhai City, Guangdong Province, in the People's
Republic of China, Universal Solar Technology, Inc., was
incorporated in the State of Nevada on July 24, 2007. It operates
through its wholly owned subsidiary, Kuong U Science & Technology
(Group) Ltd., a company incorporated in Macau, the People's
Republic of China on May 10, 2007, and its subsidiary, Nanyang
Universal Solar Technology Co., Ltd., a wholly foreign owned
enterprise registered on Sept. 8, 2008 under the wholly foreign-
owned enterprises laws of the PRC.
The Company primarily manufactures, markets and sells silicon
wafers to manufacturers of solar cells. In addition, the Company
manufactures photovoltaic modules with solar cells purchased from
third parties.
The Company reported a net loss of $593,808 on $2.4 million of
sales for 2010, compared with a net loss of $389,435 on $691,713
of sales for 2009.
The Company reported a net loss of $1.88 million on $2.80 million
of sales for the nine months ended Sept. 30, 2011, compared with a
net loss of $621,133 on $609,500 of sales for the same period a
year ago.
The Company's balance sheet at Sept. 30, 2011, showed $10.42
million in total assets, $13.09 million in total liabilities and a
$2.67 million total stockholders' deficiency.
As reported by the TCR on April 5, 2011, Paritz & Company, P.A.,
in Hackensack, New Jersey, expressed substantial doubt about
Universal Solar Technology's ability to continue as a going
concern, after auditing the Company's 2010 results. The
independent auditors noted that the Company's current liabilities
exceeded its current assets by $1,484,406 and the Company has
incurred net loss of $1,519,274 since inception.
USA BABY: 7th Cir. Rejects Shareholder's Appeals
------------------------------------------------
Creditors forced USA Baby into bankruptcy under Chapter 11. A
trustee appointed by the bankruptcy court moved to convert the
case to a Chapter 7 liquidation. The bankruptcy judge granted his
motion over the objection of Scott Wallis, a 5% shareholder who
had been the company's president when the trustee was appointed
and took over the debtor's management. Mr. Wallis moved for
reconsideration of the bankruptcy judge's order, accusing the
trustee and franchisees of committing fraud; and in a second
motion, contending that the company could regain solvency by
collecting fees withheld by the franchisees, Mr. Wallis asked the
bankruptcy court to grant "equitable relief" compelling the
franchisees to pay USA Baby what he claimed they owed it. The
bankruptcy judge denied both motions, holding that Mr. Wallis had
not offered a persuasive reason to doubt the trustee's judgment
that reorganization was infeasible, and that in a Chapter 7 case
Mr. Wallis could not bring claims on behalf of USA Baby or
litigate personal claims against the franchisees. Mr. Wallis
appealed to the district court and having lost there, appeals to
the U.S. Court of Appeals for the Seventh Circuit.
The Seventh Circuit isn't persuaded and rejected Mr. Wallis'
appeal. "Wallis has filed eight appeals to the district court and
five appeals to this court, all arising from USA Baby's
bankruptcy, all pro se and frivolous. Enough is enough. The next
time he files a frivolous appeal he will be sanctioned," said
Judge Richard Allen Posner, who penned the decision.
The case before the Seventh Circuit is, Appeals of: Scott Wallis,
Nos. 11-2018, 11-2026 (7th Cir.). Other members of the panel are
Circuit Judges Diane P. Wood, and John Daniel Tinder.
A copy of the Seventh Circuit's March 28, 2012 decision is
available at http://is.gd/sgKDjzfrom Leagle.com.
About USA Baby
Based in Lombard, Illinois, USA Baby Inc. sold infant and
children's furniture. USA Baby was formed in 2003 to franchise
stores selling furniture and other products for babies and
children. It operated no stores of its own.
On Sept. 5, 2008, three creditors, Wallis Kraham of Binghamton,
N.Y., Jack B. Whisler of Arlington Heights, Ill., and Leslie Ruess
of San Diego, filed an involuntary Chapter 11 petition (Bankr.
N.D. Ill. Case No. 08-23564), claiming breach of subscription
agreement and seeking $122,875 in the aggregate. Abraham
Brustein, Esq., at Dimonte & Lizak, LLC, represented Wallis
Kraham, one of the petitioning creditors.
The bankruptcy court entered an order for relief, leaving USA Baby
in possession of the bankruptcy estate, but the corporation did
not file the required bankruptcy schedules or statements.
A group of franchisees, citing that failure and alleging a history
of prepetition mismanagement by Scott Wallis, the company's
president and a 5% stockholder, asked the bankruptcy court to
appoint a trustee and convert the case to Chapter 7. While those
motions were pending, the company filed a statement of affairs and
the required schedules.
The bankruptcy court appointed Barry Chatz as trustee but denied
the franchisees' motion for conversion to Chapter 7. Days later,
though, Mr. Chatz filed his own motion for conversion, citing lack
of funding. The bankruptcy court converted the case but also
allowed Mr. Chatz to continue operations for a limited time.
USG CORP: Moody's Rates Proposed $250MM Sr. Unsecured Notes 'B2'
----------------------------------------------------------------
Moody's Investors Service assigned a B2 to USG Corporation's
proposed $250 million senior unsecured notes due 2020, which will
be guaranteed by USG's operating subsidiaries and pari passu to
its other unsecured notes with subsidiary guarantees. Proceeds
from the notes issuance and potentially some cash on hand will be
used to redeem at least $118 million of the company's $300 million
senior unsecured notes due August 2014 and to pay related fees and
expenses. The remaining balance of the proceeds will be used for
other corporate purposes, which could include further redemption
of debt. Moody's also affirmed the Corporate Family Rating and
Probability of Default Rating at Caa1. The company's speculative
grade liquidity assessment remains SGL-3. The rating outlook is
stable.
The following ratings/assessments were affected by this action:
Corporate Family Rating affirmed at Caa1;
Probability of Default Rating affirmed at Caa1;
$300 million senior unsecured notes due 2014 (guaranteed) affirmed
at B2 (LGD3, 30%);
$350 million senior unsecured notes due 2018 (guaranteed) affirmed
B2 (LGD3, 30%);
$250 million senior unsecured notes due 2020 (guaranteed) assigned
B2 (LGD3, 30%);
$500 million senior unsecured notes due 2016 (not guaranteed)
affirmed at Caa2 (LGD5, 79%);
$500 million senior unsecured notes due 2018 (not guaranteed)
affirmed at Caa2 (LGD5, 79%).
Shelf registration: senior unsecured notes (P) Caa2.
$239 million of Industrial Revenue Bonds ("IRB") with various
maturities (not guaranteed) affirmed at Caa2 (LGD5, 79%).
The company's speculative grade liquidity assessment remains SGL-
3.
Ratings Rationale
The B2 rating assigned to the proposed $250 million senior
unsecured notes due 2020, two notches above the corporate family
rating, are pari passu to the company's existing $300.0 million
senior unsecured notes due 2014 and the $350.0 million senior
unsecured notes due 2018. The higher ratings on these debt
instruments relative to the other unsecured debt in USG's capital
structure reflects the upstream guarantees provided by USG's
material domestic subsidiaries, which do not provide guarantees to
the other unsecured debt instruments. Proceeds from the proposed
notes and potentially some cash on hand will be used to redeem at
least $118 million of the company's $300 million senior unsecured
notes due August 2014 and to pay related fees and expenses. The
remaining balance of the proceeds will be used for other corporate
purposes, which could include further redemption of debt. The
proposed note issuance and redemption of existing debt is
effectively leverage neutral. However, once the transaction
closes, USG will have significantly reduced its refinancing risk.
Moody's believes that the company will have adequate cash on hand
and revolver availability to redeem the remaining notes balance by
2014. Once these notes are fully redeemed, USG will have an
extended maturity profile with the next significant maturity being
December 2015 when the company's revolving credit facility comes
due.
The Caa1 Corporate Family Rating results from ongoing weak
operating performance. Low capacity utilization rates of
approximately 46% during the fourth quarter of 2011 at its gypsum
manufacturing facilities make it difficult for USG to overcome its
high fixed costs. Operating margins remain negative (EBITA margin
of negative 1.9% for 2011 after applying Moody's standard
adjustments). Moody's forecasts that operating performance will
remain substandard over the next few years relative to the current
rating despite some potential for higher new housing starts and
improving remodeling activity, the main drivers of USG's revenues.
USG's capital structure remains highly leveraged. Debt-to-EBITDA
was 20.2 times at FYE11 and its (EBITDA-CAPEX)-to-interest expense
was 0.2 times for 2011. Despite expectations of some improvement
in USG's end markets and reduced interest expense due to the
refinancing of the Notes due 2014 at lower rates, Moody's projects
that interest coverage will below 1.0 times over the next few
years.
USG's SGL-3 speculative grade liquidity assessment reflects
Moody's view that it will maintain an adequate liquidity profile
over the next twelve months. Cash on hand, marketable securities
and availability under the company's revolving credit facilities
aggregating about $834 million (equivalent) at 4Q11 provide USG
the ability to fund future cash shortfalls over the next 12 to 18
months. Cash on hand and marketable securities totaled about $651
million at December 31, 2011. Constraining the liquidity rating is
the company's inability to generate meaningful levels of free cash
flow despite improving working capital management and reducing
capital expenditures.
The stable outlook incorporates Moody's view that the combination
of cash on hand, marketable securities, and revolver availability
and no significant maturities until December 2015 give USG
financial flexibility to contend with uncertainties in the North
American economy and slow growth prospects in company's end
markets.
Positive rating actions are unlikely without significant
improvement in USG's end markets and a more positive operating
environment. Over time, debt-to-EBITDA trending towards 6.0 times
on a sustainable basis or EBITA-to-interest approaching 2.0 times
(all ratios incorporate Moody's standard adjustments) while
maintaining a solid amount of liquidity could result in ratings
improvement.
Deterioration in the company's liquidity profile due to the
ongoing use of cash to make up for operating shortfalls while key
credit metrics remain substandard could pressure the ratings.
The principal methodology used in rating USG was the Global
Manufacturing Industry Methodology, published December 2010. Other
methodologies used include Loss Given Default for Speculative
Grade Issuers in the US, Canada, and EMEA, published June 2009.
USG Corporation, headquartered in Chicago, IL, is a leading
producer and distributor of building materials in the Unites
States, Canada and Mexico. The company manufactures and markets
gypsum wallboard and operates a specialty distribution business
that sells to professional contractors. USG also manufactures
ceiling tiles and ceiling grids used primarily in commercial
applications. Revenues for the twelve months through December 31,
2011 totaled approximately $3.0 billion.
USG CORP: S&P Rates New $250-Mil. Senior Unsecured Notes 'BB-'
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' rating to
Chicago-based USG Corp.'s (B/Negative/--) proposed $250 million
senior unsecured notes due 2020, based on proposed terms and
conditions. The notes have a recovery rating of '1', indicating
our expectation of high recovery (90% to 100%) for investors in
the event of a default. The notes are being offered in accordance
with Rule 144A under the Securities Act of 1933.
"We expect the company to use all or a portion of the net proceeds
of the notes to repurchase its $300 million 9.75% notes due 2014
that have been validly tendered and accepted for payment under a
recent tender offer, and to pay related costs and expenses. As of
March 27, 2012, approximately $117.9 million principal amount of
2014 notes had been validly tendered. After repurchasing 2014
notes pursuant to the tender offer, USG intends to use any
remaining net proceeds from the sale of the notes for working
capital and other general corporate purposes, which may include
the repurchase or other acquisition of 2014 notes or other
outstanding debt securities through open market purchases,
privately negotiated transactions, redemptions, or other tender or
exchange offers, or by other means," S&P said.
"The 'B' corporate credit rating on wallboard and ceiling tile
manufacturer USG Corp. reflects the combination of what Standard &
Poor's Ratings Services views to be the company's 'weak' business
risk and 'highly leveraged' financial risk. Historically, USG's
earnings and cash flow have been subject to wide swings with
wallboard volumes largely influenced by residential construction
activity. Our ratings recognize that the company's credit measures
are likely to remain extremely weak due to cyclically poor
financial results for at least the next several quarters," S&P
said.
RATINGS LIST
USG Corp.
Corporate credit rating B/Negative/--
New Rating
$250 mil sr unsecd notes due 2020 BB-
Recovery rating 1
USG CORP: Fitch Rates $250 Million Sr. Unsecured Notes at 'B+/RR2'
------------------------------------------------------------------
Fitch Ratings has assigned a 'B+/RR2' rating to USG Corporation's
(NYSE: USG) proposed offering of $250 million principal amount of
senior unsecured notes due 2020. The new issue will be guaranteed
on a senior unsecured basis by certain of USG's domestic
subsidiaries. The company intends to use the net proceeds from
the notes issuance to fund the recently announced cash tender
offer for any and all of its outstanding $300 million 9.75% senior
notes due 2014 and for working capital and other general corporate
purposes.
Fitch currently rates USG's Issuer Default Rating (IDR) at 'B-'.
The Rating Outlook is Negative.
The rating for USG reflects the company's leading market position
in all of its businesses, strong brand recognition, its large
manufacturing network and sizeable gypsum reserves. Risks include
the cyclicality of the company's end-markets, excess capacity
currently in place in the U.S. wallboard industry, volatility of
wallboard pricing and shipments and the company's high leverage.
The Negative Outlook reflects Fitch's belief that underlying
demand for the company's products will remain weak through at
least 2012 and the company's liquidity position is likely to
deteriorate in the next 12 months. With only a moderate economic
growth expectation for 2012, the environment may at best support a
relatively modest recovery in housing metrics over the next 12
months. New commercial construction spending, although expected
to improve relative to 2011, is projected to remain significantly
below pre-recession levels.
USG currently has $834 million of liquidity comprised of $365
million of cash, $286 million of short-term and long-term
marketable securities and $183 million of availability under its
U.S. and Canadian revolving credit facilities. However, a weak
operating environment over the next 12 months will likely result
in continued losses and negative free cash flow (FCF) for the
company, thereby eroding its currently solid liquidity position.
Fitch currently projects USG's overall liquidity will be between
$650 million and $700 million by year-end 2012. Should the
depressed level of housing starts and weak new non-residential
construction spending persist beyond 2012, USG's liquidity could
deteriorate further and prompt negative rating actions.
USG markets its products primarily to the construction industry,
with approximately 21% of the company's 2011 net sales directed
toward new residential construction, 23% derived from new non-
residential construction, 53% from the repair and remodel segment
(commercial and residential) and 3% from other industrial
products.
Certain recent economic/construction related statistics, such as
job growth, consumer confidence, household formations, multifamily
starts, existing home sales, pending home sales, housing
inventories, and foreclosures were improving and/or above
consensus. A few key statistics such as single-family housing
starts, new home sales, home prices (CoreLogic, Case Shiller) were
declining/short of expectations. Overall, the current setting is
much like at the beginning of 2011.
Fitch's housing forecasts for 2012 assume a modest rise off a very
low bottom. New-home inventories are at historically low levels
and affordability is at near-record highs. In a slowly growing
economy with distressed home sales competition similar to 2011,
less competitive rental cost alternatives, and, possibly, even
lower mortgage rates on average, single-family housing starts
should improve about 5% to 450,000, while new-home sales increase
approximately 5.6% to 319,000 and existing-home sales grow 3% to
4.388 million.
Fitch currently projects home improvement spending will increase
4% in 2012. The gradual improvement in the economy and moderately
better housing market conditions could provide the catalyst for a
slightly more robust increase in spending for remodeling projects
next year.
New commercial construction is expected to be constrained again
this year as fundamentals, while improving, remain weak compared
to pre-recession levels. It may take several years before any
meaningful growth occurs, as credit availability remains an issue
and a glut of unoccupied commercial space will limit new
development projects in the intermediate term. Fitch currently
projects private nonresidential expenditures will grow 4% in 2012.
While Fitch is currently projecting some improvement in the
construction sector during 2012, this level of activity is
unlikely to result in much of an improvement in wallboard demand
and industry capacity utilization rates.
Last year, major manufacturers announced that they were
eliminating the practice of job quotes in 2012. In the past,
job quotes provided pricing protection for customers, particularly
for large projects. However, this practice also limited the
effectiveness of price increases implemented by manufacturers.
Most manufacturers announced that they are implementing a 30%-35%
increase in wallboard prices effective in 2012.
The manufacturers' pricing increases appear to be gaining
traction. USG recently reported that for the first two months of
2012, net sales improved 15.7% to $516.9 million and the company
had operating profit of $5.7 million and a net loss of $30.5
million. During the comparable period in 2011, USG had net sales
of $446.9 million, an operating loss of $46.8 million and a net
loss of $82.3 million. The company attributes the improved year-
over-year results primarily to increases in U.S. average wallboard
price and wallboard gross margin.
While USG has had initial success with its price increase, it
remains unclear how much of the announced 2012 increase will be
fully realized and if this level of pricing can be sustained
throughout the year given lackluster wallboard demand. With
continued low demand levels, some producers may choose to price
more aggressively in order to gain market share.
Fitch currently rates USG as follows:
-- IDR 'B-';
-- Secured bank credit facility 'BB-/RR1';
-- Senior unsecured guaranteed notes 'B+/RR2';
-- Senior unsecured notes 'CCC/RR5';
-- Convertible senior unsecured notes 'CCC/RR5'.
Fitch's Recovery Rating (RR) of 'RR1' on USG's $400 million
secured revolving credit facility indicates outstanding recovery
prospects for holders of this debt issue. Fitch's 'RR2' on USG's
unsecured guaranteed notes indicates superior recovery prospects.
(Currently, $650 million of unsecured notes are guaranteed on a
senior unsecured basis by certain of USG's domestic subsidiaries.)
Fitch's 'RR5' on USG's senior unsecured notes that are not
guaranteed by the company's subsidiaries indicates below-average
recovery prospects for holders of these debt issues. Fitch
applied a liquidation analysis for these RRs.
VANGUARD HEALTH: S&P Rates $375-Mil. Senior Notes 'B-'
------------------------------------------------------
Standard & Poor's Ratings Services affirmed its corporate credit
rating on Nashville, Tenn.-based Vanguard Health Systems Inc. at
'B'. The rating outlook is stable.
"At the same time, we have assigned the $375 million senior notes
due 2019 co-issued by Vanguard Health Holding Co. II Inc. and
Vanguard Health Holding Co. II LLC an issue-level rating of 'B-'
(one notch lower than the 'B' corporate credit rating on the
company). We also assigned this debt a recovery rating of '5',
indicating our expectation of modest (10% to 30%) recovery for
noteholders in the event of a payment default," S&P said.
All issue-level and recovery ratings on the company's existing
debt issues remain unchanged.
"Vanguard Health's issuance of $375 million senior unsecured notes
has no impact on the 'B' corporate credit rating," said Standard &
Poor's credit analyst David Peknay. "The effect of the additional
debt is to raise our expectation for pro forma debt in 2012 to
about 6.1x from 5.5x. This increase is within our parameters for
the current rating, which incorporates our view of the company's
'highly leveraged' financial risk profile."
"The 'B' rating reflects our expectation that acquisition activity
will drive a 23% revenue increase in 2012, and that its lease-
adjusted EBITDA margin will increase about 70 basis points to the
high-8% area. We do not view the margin increase as an improvement
because nearly all of it results from a change in accounting
methodology for the provision for doubtful accounts, and therefore
is not a true margin improvement. We believe Vanguard's organic
growth rate will hover in the low- to mid-single-digit area and
over time, we believe it will pursue acquisitions to supplement
growth. We believe reimbursement constraints will contribute to
flat margins (adjusting for the recent accounting change) that we
believe will result in little improvement in leverage. We believe
other rate cuts--such as the two cuts in Arizona within the past
year--are examples of this risk. Without acquisitions, Vanguard's
lease-adjusted debt to EBITDA will remain well above 5x. We expect
Vanguard will struggle to generate free cash flow for the next two
years, because of large working capital needs, significant capital
spending, and required pension and insurance liability funding,"
S&P said. .
"We view Vanguard's financial risk profile as 'highly leveraged,'
according to our criteria, reflected in our view of its debt to
EBITDA level of about 6.1x on a pro forma basis, which considers
recent acquisition activity. This measure includes Vanguard's
pension and insurance liabilities on a tax-effected basis as debt,
consistent with our criteria. This viewpoint includes our belief
that Vanguard will not generate any meaningful free cash flow for
the next two years, and so will not be in a position to repay
debt. We believe any large acquisition activity would increase
leverage, because debt financing would be necessary, and the
company typically acquires assets that generate low margins," S&P
said.
"We view Vanguard's business risk as 'weak,' because of its
relatively undiversified portfolio of hospitals, uncertain
reimbursement, and concentration in markets that we consider
competitive. Its largest market, Detroit (generating about 35% of
total revenues), is particularly vulnerable to a weak local
economy and to potentially adverse changes in Medicaid
reimbursement. The weak business risk assessment incorporates our
view of Vanguard's relatively small number of markets and their
competitiveness. The company derives about one-half of revenues
from only two markets. This profile is weaker than other peer
hospital companies that operate in a larger number of markets,
that in many cases may not be as competitive," S&P said.
VANTIV LLC: S&P Lifts Corp. Credit Rating to BB; Outlook Positive
-----------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Symmes Township, Ohio-based Vantiv LLC to 'BB' from 'B+'
and removed the company from CreditWatch, where it was place with
positive implications on Feb. 22, 2012.
"We also assigned our 'BBB-' issue-level rating to the company's
first-lien senior secured credit facilities, consisting of a $250
million revolver, a $1 billion term loan A, and a $250 million
term loan B). The recovery rating on this debt is '1', indicating
our expectation of very high (90%-100%) recovery for lenders in
the event of a payment default," S&P said.
"We have withdrawn the ratings on the company's former first-lien
senior secured debt," S&P said.
"The upgrade follows Vantiv's successful execution of an IPO and
concurrent refinancing," said Standard & Poor's credit analyst
Alfred Bonfantini. "The IPO alters our view that sustained de-
leveraging is unlikely, given the broader oversight and fiduciary
responsibility to an increased number of stakeholders."
"Furthermore, pro forma adjusted leverage is now around 3x, down
from about 4x at fiscal year-end Dec. 31, 2011. The company
received primary proceeds of $500 million from its IPO--at the
high end of its goal--which it used, along with proceeds from the
new first-lien senior secured debt facilities, to repay existing
first-lien lenders," S&P said.
"The outlook is positive, reflecting our expectation for de-
leveraging over the near term through mandatory debt reduction as
well as continued solid revenue growth and consistent
profitability. The positive outlook is also supported by the
company's strong U.S. market position and solid cash flows," S&P
said.
"We could raise the rating to 'BB+' if the company can reduce and
sustain leverage in the mid- to high-2x area while maintaining
margins and prudent financial policies. We could stabilize the
outlook if increased competition and/or a stagnating economy leads
to pricing pressure and lower processing volumes, resulting in
leverage between 3.0x-3.5x. A more aggressive posture toward debt-
financed acquisitions, as the company pursues its diversification
and growth strategies, or shareholder returns could also limit a
possible upgrade," S&P said.
VERMILLION INC: PwC Raises Going Concern Doubt
----------------------------------------------
Vermillion, Inc., filed on March 27, 2012, its annual report on
Form 10-K for the fiscal year ended Dec. 31, 2011.
PricewaterhouseCoopers LLP, in Austin, Texas, expressed
substantial doubt about Vermillion, Inc.'s ability to continue as
a going concern. The independent auditors noted that the Company
has incurred recurring losses and negative cash flows from
operations and has debt outstanding due and payable in October
2012.
The Company reported a net loss of $17.8 million on $1.9 million
of revenue for 2011, compared with a net loss of $19.0 million on
$1.2 million of revenue for 2010.
The Company's balance sheet at Dec. 31, 2011, showed $23.1 million
in total assets, $12.7 million in total liabilities, and
stockholders' equity of $10.4 million.
A copy of the Form 10-K is available for free at:
http://is.gd/IBFqkm
Austin, Texas-based Vermillion, Inc. (NASDAQ: VRML)
-- http://www.vermillion.com-- is dedicated to the discovery,
development and commercialization of novel high-value diagnostic
tests that help physicians diagnose, treat and improve outcomes
for patients. Vermillion, along with its prestigious scientific
collaborators, has diagnostic programs in oncology, cardiology and
women's health.
VERTRUE LLC: S&P Withdraws 'D' Corp. Credit Rating on Lack of Info
------------------------------------------------------------------
Standard & Poor's Ratings Services revised its recovery rating on
Norwalk, Conn.-based Vertrue LLC's secured first-lien debt to '5',
indicating its expectation of modest recovery (10% to 30%) for
lenders in the event of a payment default, from '4' (30% to 50%
recovery expectation). The issue-level rating on the first-lien
debt remains at 'D'. "The recovery rating change reflects our
current assessment that the company's Adaptive Marketing business
will provide no recovery value for lenders," S&P said.
"Subsequent to this action, we withdrew all of our ratings on
Vertrue, including the 'D' corporate credit rating. The ratings
were withdrawn because of a lack of financial information on the
company," S&P said.
VULCAN MATERIALS: S&P Keeps 'BB' Corp. Credit Rating on Watch Pos
-----------------------------------------------------------------
Standard & Poor's Ratings Services was keeping its ratings on
Birmingham, Ala.-based Vulcan Materials Co., including the 'BB'
corporate credit rating, on CreditWatch with positive
implications.
"We placed the ratings on Vulcan on CreditWatch with positive
implications Dec. 13, 2011, based on competitor Martin Marietta's
announcement of an unsolicited offer to acquire Vulcan for
approximately $4.7 billion in stock. Under the terms of the
proposed exchange offer, existing Vulcan shareholders would
receive 0.5 shares of Martin Marietta stock for each share of
Vulcan. If completed as proposed, Vulcan shareholders would own
approximately 58% of the combined entity," S&P said.
"To date, Vulcan's board has recommended rejection of Martin
Marietta's offer as inadequate. Martin Marietta has also proposed
the election of four new members to Vulcan's board at the time of
Vulcan's annual shareholder meeting to be scheduled, we believe by
mid-year. There are also several legal actions underway between
Vulcan Materials and Martin Marietta, the outcome of which could
impact the timing and completion of the combination of the two
companies. Also, the offer to exchange Vulcan shares for Martin
shares expires on May 18, 2012, but could be extended," S&P said.
"The positive CreditWatch listing for Vulcan Materials reflects
what we view as the proposed combined company's generally enhanced
business risk profile and the overall deleveraging effect of the
proposed acquisition would have for Vulcan," said Standard &
Poor's credit analyst Thomas Nadramia. "If the transaction were to
proceed and be completed as proposed, with the assumption of
approximately $2.8 billion of Vulcan's outstanding book debt,
total pro forma adjusted debt (including pension obligations,
operating leases, etc.) would approximate $4.7 billion, resulting
in total adjusted debt to EBITDA, not including proposed
synergies, of about 6.3x, compared with Vulcan's current total
leverage of about 8.4x," S&P said.
The completion of the proposed merger is subject to the outcome of
the exchange offer and, as well as certain customary conditions
and regulatory approvals.
"Standard & Poor's will meet with management to assess operating
and financial plans and will continue to monitor events, including
the outcome of the legal actions, the results of the exchange
offer and the election of new members to Vulcan's board of
directors. In resolving the CreditWatch listing, Standard & Poor's
will assess the likelihood of completion of the merger and the
impact on the ratings on Vulcan Materials Co.," S&P said.
W.R. GRACE: Bryan Cave HRO Succeeds Holme Roberts as Counsel
------------------------------------------------------------
Eric E. Johnson, Esq., at Bryan Cave HRO, formerly Holme Roberts &
Owen LLP, in Denver, Colorado, filed with the Bankruptcy Court a
supplemental disclosure with regard to BCHRO's employment as
successor counsel to HRO.
As authorized by a retention order, HRO continued to represent the
Debtors as special environmental counsel for a period of over 10
years, through December 31, 2011, at which point it was succeeded
as special environmental counsel by BCHRO, which continues to
serve as special environmental counsel to the Debtors.
On January 1, 2012, the lawyers of HRO combined with Bryan Cave
LLP to form BCHRO in Colorado. As of the date of the Combination,
HRO no longer engaged in the practice of law, and all of HRO's
client relationships were transferred to BCHRO or BCLLP, as
applicable. Mr. Johnson disclosed that only lawyers and
paralegals employed by BCHRO in Colorado have provided
professional services to the Debtors following the Combination.
As of the date of the Combination, HRO's substantive
representation of the Debtors as special environmental counsel was
largely concluded, Mr. Johnson relates. He notes that at that
time, only three open matters remained, and only one of those
matters involved substantive environmental representation. As of
the date of the Combination, the open matters regarding which
BCHRO was continuing to provide services to the Debtors were:
Matter Number Description
------------- ------------
00000 General Counsel and Advice
00300 Defense of United States of America v. W.R.
Grace & Co. - Conn. and Kootenai Development
Corporation, Case No. 01-72-M-DWM, which
concerns remedial activities in and around
Libby, Montana
00390 Bankruptcy Matters - Aspects pertaining to the
bankruptcy case, including preparation of
monthly and quarterly fee applications.
Mr. Johnson attests that he and no other attorney of BCHRO or
BCLLP is related, to any judge of the United States Bankruptcy
Court for the District of Delaware or to the United States Trustee
for this District. He adds that he does not hold or represent any
interest adverse to the Debtors or their estates with respect to
any of the three matters regarding which BCHRO continues to
provide representation and professional legal services on or after
the date of the Combination.
BCHRO will charge hourly rates to the Debtors that are consistent
with customary hourly rates charged by BCHRO to its other clients,
which currently are $80 to $200 for paralegals, $200 to $610 for
associates, and $285 to $910 for partners and counsel, subject to
periodic adjustments, plus reimbursement of actual and necessary
expenses. The principal attorneys and paralegals of BCHRO, who
will continue to be handling the representation of the Debtors and
their current standard hourly rates are:
Name of Professional Position Hourly Rate
-------------------- -------- -----------
Eric E. Johnson Counsel $465
Joan L. Sherman Paralegal $200
Stanley Friedman Paralegal $175
William E. Payne Litigation $190
Support Analyst
About W.R. Grace & Co.
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -
- http://www.grace.com/-- supplies catalysts and silica products,
especially construction chemicals and building materials, and
container products globally.
The company and its debtor-affiliates filed for chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura
Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP,
represent the Debtors in their restructuring efforts. The Debtors
hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.
Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent
the Official Committee of Unsecured Creditors. The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice. David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA.
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla
R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official
Committee of Asbestos Personal Injury Claimants. The Asbestos
Committee of Property Damage Claimants tapped Scott Baena, Esq.,
and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod,
LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel, LLP, represents the Official Committee of
Equity Security Holders.
W.R. Grace obtained confirmation of a plan co-proposed with the
Official Committee of Asbestos Personal Injury Claimants, the
Official Committee of Equity Security Holders, and the Asbestos
Future Claimants Representative. The Chapter 11 plan is built
around an April 2008 settlement for all present and future
asbestos personal injury claims, and a subsequent settlement for
asbestos property damage claims. Implementation of the Plan has
been held up by appeals in District Court from various parties,
including a group of prepetition bank lenders and the Official
Committee of Unsecured Creditors.
District Judge Ronald Buckwalter on Jan. 31, 2012, entered an
order affirming the bankruptcy court's confirmation of W.R. Grace
& Co. and its debtor affiliates' Plan of Reorganization.
Bankruptcy Judge Judith Fitzgerald had approved the Plan on
Jan. 31, 2011.
Bankruptcy Creditors' Service, Inc., publishes W.R. Grace
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
W.R. GRACE: Nat'l Indemnity Sues Montana Over Asbestos Settlement
-----------------------------------------------------------------
Pat Guth, writing for Mesothelioma News, reported on Feb. 28,
2012, that The National Indemnity Company sued the State of
Montana in the hopes of recovering about $16 million that was part
of a financial settlement for victims of asbestos exposure from
the W.R. Grace and the Libby, Montana Superfund site.
Ms. Guth, citing an Associated Press article, said the insurance
company paid into the settlement under "a 2005 agreement that
reserved the company's right to seek future recovery of the
money." National Indemnity alleged that the State did not
properly notify them about the lawsuits pertaining to asbestos
exposure at the Libby site, and also maintains that outside
counsel for the state failed to notify the insurer that they would
indeed fight the claims, the report related.
According to the report, National Indemnity was made to pay the
settlement because of a comprehensive general liability policy
that was effective from July 1973 to July 1975. The money from
the settlement went into a trust fund used to pay victims, the
report noted. Also included in the trust is $26.8 million from
the state's self-insurance reserve fund and $100,000 from the
Montana Insurance Guaranty Association, the report said. The AP
article, according to Ms. Guth, said that since the trust was not
named in the lawsuit, it should not be affected by this legal
action.
About W.R. Grace & Co.
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -
- http://www.grace.com/-- supplies catalysts and silica products,
especially construction chemicals and building materials, and
container products globally.
The company and its debtor-affiliates filed for chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura
Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP,
represent the Debtors in their restructuring efforts. The Debtors
hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.
Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent
the Official Committee of Unsecured Creditors. The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice. David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA.
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla
R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official
Committee of Asbestos Personal Injury Claimants. The Asbestos
Committee of Property Damage Claimants tapped Scott Baena, Esq.,
and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod,
LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel, LLP, represents the Official Committee of
Equity Security Holders.
W.R. Grace obtained confirmation of a plan co-proposed with the
Official Committee of Asbestos Personal Injury Claimants, the
Official Committee of Equity Security Holders, and the Asbestos
Future Claimants Representative. The Chapter 11 plan is built
around an April 2008 settlement for all present and future
asbestos personal injury claims, and a subsequent settlement for
asbestos property damage claims. Implementation of the Plan has
been held up by appeals in District Court from various parties,
including a group of prepetition bank lenders and the Official
Committee of Unsecured Creditors.
District Judge Ronald Buckwalter on Jan. 31, 2012, entered an
order affirming the bankruptcy court's confirmation of W.R. Grace
& Co. and its debtor affiliates' Plan of Reorganization.
Bankruptcy Judge Judith Fitzgerald had approved the Plan on
Jan. 31, 2011.
Bankruptcy Creditors' Service, Inc., publishes W.R. Grace
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
W.R. GRACE: Board Approves Incentive Compensation Program
---------------------------------------------------------
W.R. Grace & Co. disclosed in a regulatory filing with the U.S.
Securities and Exchange Commission on February 23, 2012, that the
compensation committee of the Company's Board of Directors
approved the Grace Annual Incentive Compensation Program
applicable to all executive officers.
The amount of an individual's payment under the AICP is
discretionary and is based upon: the individual's AICP target
amount; the size of the AICP incentive pool; and the individual's
performance during the one-year performance period. The size of
the AICP incentive pool is determined based on two Grace
performance measures:
* 75% of the aggregate AICP incentive pool (the "Adjusted EBIT
Pool") funding is based on the amount of Grace Adjusted EBIT
for the one-year performance period, calculated as described
in "Management's Discussion and Analysis of Financial
Condition and Results of Operations -- Analysis of
Operations" in the Grace 2011 Annual Report on Form 10-K as
filed with the Securities and Exchange Commission on
February 24, 2012; and
* 25% of the aggregate AICP incentive pool (the "Working
Capital Pool") funding is based on the average days that
Grace's sales are outstanding during the one-year
performance period ("DSO"), the average days of inventory
Grace has on hand during the one-year performance period
("DOH") and the average days Grace's accounts payable are
outstanding during the one-year performance period ("ADP")
calculated as follows: (DSO + DOH - ADP).
The Compensation Committee has discretion to adjust the
performance objectives or establish or increase the size of the
AICP incentive pool even if performance objectives are not
achieved.
The amount of the AICP incentive pool will be the sum of the
amounts funded in the Adjusted EBIT Pool and the Working Capital
Pool (each, a "Partial Pool"). The funding of each Partial Pool
is determined independently by reference to the Adjusted EBIT and
Working Capital performance targets set forth in the Grace Annual
Operating Plan for the one-year performance period (each a
"Relevant Target"):
Percentage of 75%
(Adjusted EBIT) or 25%
(Working Capital) of Actual Grace
Aggregate Target Award Performance as a
Amounts Funded in Partial Percentage of
Pool* Relevant Target
(%) (%)
------------------------- -------------------
-0- less than 80
25 80
100 100
200 135 or above
Actual amounts funded to Partial Pools are separately prorated on
a straight line basis for performance that falls between 80% and
100% of the Relevant Target or between 100% and 135% of the
Relevant Target.
J. Murphy Steps Down as Director
In a separate regulatory filing dated February 29, 2012, Grace
disclosed that John J. Murphy resigned as a member of the
Company's Board of Directors on February 23.
About W.R. Grace & Co.
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -
- http://www.grace.com/-- supplies catalysts and silica products,
especially construction chemicals and building materials, and
container products globally.
The company and its debtor-affiliates filed for chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura
Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP,
represent the Debtors in their restructuring efforts. The Debtors
hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.
Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent
the Official Committee of Unsecured Creditors. The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice. David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA.
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla
R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official
Committee of Asbestos Personal Injury Claimants. The Asbestos
Committee of Property Damage Claimants tapped Scott Baena, Esq.,
and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod,
LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel, LLP, represents the Official Committee of
Equity Security Holders.
W.R. Grace obtained confirmation of a plan co-proposed with the
Official Committee of Asbestos Personal Injury Claimants, the
Official Committee of Equity Security Holders, and the Asbestos
Future Claimants Representative. The Chapter 11 plan is built
around an April 2008 settlement for all present and future
asbestos personal injury claims, and a subsequent settlement for
asbestos property damage claims. Implementation of the Plan has
been held up by appeals in District Court from various parties,
including a group of prepetition bank lenders and the Official
Committee of Unsecured Creditors.
District Judge Ronald Buckwalter on Jan. 31, 2012, entered an
order affirming the bankruptcy court's confirmation of W.R. Grace
& Co. and its debtor affiliates' Plan of Reorganization.
Bankruptcy Judge Judith Fitzgerald had approved the Plan on
Jan. 31, 2011.
Bankruptcy Creditors' Service, Inc., publishes W.R. Grace
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
WAVE SYSTEMS: Incurs $4.8 Million Net Loss in Fourth Quarter
------------------------------------------------------------
Wave Systems Corp. reported a net loss of $4.86 million on $11.03
million of total net revenues for the three months ended Dec. 31,
2011, compared with a net loss of $1.21 million on $7.03 million
of total net revenues for the same period a year ago.
The Company reported $10.79 million on $36.14 million of total net
revenues in 2011, compared with a net loss of $4.12 million on
$26.05 million of total net revenues in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $30.12
million in total assets, $18.58 million in total liabilities and
$11.54 million in total stockholders' equity.
Wave CEO Steven Sprague, commented, "2011 was a pivotal year for
Wave as we built the business across several important fronts,
deepening our engagement into exciting new product markets and
geographies. As a result of significant enterprise deals closed
in Europe, we expanded our presence in the region, adding a team
of seasoned sales professionals and establishing offices in
France, Germany and the United Kingdom to support our market
outreach. Through our acquisition of Safend, we rounded out our
product portfolio with a robust set of award-winning Data Loss
Prevention (DLP) products, added to our roster of customers,
expanded our engineering and sales teams and secured a foothold in
Israel and other global markets. While the pre-acquisition
accounting errors we have reported for Safend are regrettable,
they do not change our view of the importance of this acquisition
for Wave."
A copy of the press release is available for free at:
http://is.gd/g4DpL0
About Wave Systems
Lee, Massachusetts-based Wave Systems Corp. (NASDAQ: WAVX) --
http://www.wave.com/-- develops, produces and markets products
for hardware-based digital security, including security
applications and services that are complementary to and work with
the specifications of the Trusted Computing Group, an industry
standards organization comprised of computer and device
manufacturers, software vendors and other computing products
manufacturers.
Due to the early stage nature of its market category, Wave is
unable to predict with a high enough level of certainty whether
enough revenue will be generated to fund its cash flow
requirements for the twelve-months ending Sept. 30, 2012. Given
the uncertainty with respect to Wave's revenue forecast for the
twelve-months ending Sept. 30, 2012, Wave may be required to raise
additional capital through either equity or debt financing in
order to adequately fund its capital requirements for the twelve-
months ending Sept. 30, 2012. As of Sept. 30, 2011, the Company
had approximately $6.9 million of cash on hand and positive
working capital of approximately $1.3 million. Considering the
Company's current cash balance and Wave's projected operating cash
requirements, the Company projects that it will have enough liquid
assets to continue operating through Sept. 30, 2012. However, due
to the Company's current cash position, its capital needs over the
next twelve months and beyond, the fact that it may require
additional financing and uncertainty as to whether it will achieve
its sales forecast for its products and services, substantial
doubt exists with respect to its ability to continue as a going
concern.
Wave's independent registered public accounting firm has issued a
report dated March 16, 2010, that includes an explanatory
paragraph referring to its significant operating losses and
substantial doubt about its ability to continue as a going
concern.
WESTAIM CORP: A.M. Best Raises Issuer Credit Rating from 'bb'
-------------------------------------------------------------
A.M. Best Co. has upgraded the issuer credit rating (ICR) to
"bbb+" from "bbb" and affirmed the financial strength rating of
B++ (Good) of Jevco Insurance Company (Quebec). Concurrently,
A.M. Best has upgraded the ICR to "bb+" from "bb" of Jevco's
publicly traded parent, The Westaim Corporation (Ontario)
[TSX:WED]. The outlook for all ratings has been revised to
positive from stable.
The ratings of Jevco reflect its excellent risk-adjusted
capitalization, favorable operating performance and market
expertise. In addition, the ratings reflect the benefits derived
from the financial flexibility and explicit support of Westaim.
The positive outlook acknowledges A.M. Best's expectation that
Jevco will continue to produce favorable operating trends while
maintaining a solid level of risk-adjusted capitalization.
These positive rating factors are partially offset by soft
commercial market conditions and strong competitive market
pressures in non-standard auto and commercial auto. In addition,
although there are potential legacy reserve issues with Jevco
being a former subsidiary of Kingsway Financial Services, Inc.,
A.M. Best anticipates that the residual financial effects of this
former relationship have become less material.
Factors that could lead to the upgrading of Jevco's ratings
include a continued strong operating performance and stable
reserve development while maintaining strong risk-adjusted
capitalization.
The rating of Westaim is based on the overall financial strength
of Jevco, its main operating company in Canada.
WORLDGATE COMMUNICATIONS: To Liquidate Under Chapter 7
------------------------------------------------------
WorldGate Communications, Inc., filed a voluntary petition for
relief under Chapter 7 of the United States Bankruptcy Code
(Bankr. D. Del. Case No. 12-11106) on March 30, 2012.
Effective as of March 30, a Chapter 7 trustee assumed control of
the Company. The assets of the Company will be liquidated in
accordance with the Code.
It is anticipated that WorldGate Service, Inc., WorldGate Finance,
Inc., Ojo Service LLC and Ojo Video Phones LLC, which constitute
all of the subsidiaries of the Company, will subsequently file
voluntary petitions for relief under Chapter 7 of the Code in the
United States Bankruptcy Court for the District of Delaware.
The Bankruptcy Filing triggers an event of default under the
Company's and its subsidiaries' outstanding debt obligations to
WGI Investor LLC under its revolving line of credit having an
outstanding balance, as of March 30, 2012, of approximately $3.6
million.
With the installation of the chapter 7 trustee and concurrent with
the Bankruptcy Filing, on March 30, 2012, the employment of Allan
Van Buhler, Principal Executive Officer, Senior Vice President and
Secretary was terminated. As a result, the Company no longer has
any employees.
Also, with the installation of the chapter 7 trustee and
concurrent with the Bankruptcy Filing, on March 30, 2012,
directors Robert Stevanovski, Geoffrey M. Boyd, Anthony J.
Cassara, Brian Fink, Colleen R. Jones, Richard Nespola and David
Stevanovski resigned as members of the Company's Board of
Directors. The Company has no current members of the Board of
Directors.
About Worldgate Communications
Trevose, PA, WorldGate Communications, Inc. (OTC BB: WGAT.OB)
designs and develops innovative digital video phones featuring
high quality, real-time, two-way video.
As reported in the TCR on April 12, 2011, Marcum LLP, in New York,
expressed substantial doubt about WorldGate Communications'
ability to continue as a going concern, following the Company's
2010 results. The independent auditors noted that of the
Company's recurring losses from operations, working capital
deficiencies and stockholders' deficit.
The Company's balance sheet at Sept. 30, 2011, showed $5.62
million in total assets, $11.29 million in total liabilities and a
$5.67 million total stockholders' deficiency.
ZENAIDA POSTOLICA: Rosamond Property Worth $90,745
--------------------------------------------------
Zenaida and Danut Postolica ask the Bankruptcy Court to set the
value of property located at 2827-2833 B Street, Rosamond,
California, for purposes of their Chapter 11 plan of
reorganization. The Debtors seek to value the Property at
$70,000, limit East West Bank's secured claim to $70,000, and
adjust the interest rate on the claim from the current 7% to 5%.
East West Bank opposes the Debtors' motion, and instead seeks a
determination that the Property is worth $100,000.
The Property is encumbered by a first deed of trust securing a
loan from East West Bank. On the bankruptcy petition date, the
Debtors owed East West Bank $95,157 under the note.
After a two-day evidentiary hearing, Bankruptcy Judge Arthur S.
Weissbrodt values the Property at $90,745, which is $4,411 less
than East West Bank's first priority deed of trust in the amount
of $95,157. The Debtors' Motion to determine the value and status
of East West Bank's lien as unsecured is granted. The Court held
that the value of the Property was less than the amount secured by
the first deed of trust at the time bankruptcy was filed. East
West Bank's secured claim is in the amount of $90,745.22 and is
unsecured in the amount of $4,411.
A copy of the Court's March 27, 2012 Memorandum Decision is
available at http://is.gd/2uUS7mfrom Leagle.com.
The Debtors were represented by Lewis Phon, Esq. --
phonlaw@sbcglobal.net -- at The Law Offices of Lewis Phon.
Celine Mui Simon, Esq. -- csimon@frenchandlyon.com -- at French &
Lyon, Attorneys at Law, appeared on behalf of East West Bank.
Sunnyvale, California-based Zenaida Masacayan Postolica -- aka
Neddie Postolica, CB Associates, Piatranet, LLC, Neddie Postolica,
CB Associates -- and Danut Laur Postolica -- Dan Postolica and
Romphi International -- filed for Chapter 11 bankruptcy (Bankr.
N.D. Calif. Case No. 10-51522) on Feb. 18, 2010. The Law Offices
of Lewis Phon serves as the Debtors' counsel. In their petition,
the Debtors estimated $1 million to $10 million in assets and
debts. The Debtors own several investment properties. Their
property at 2827-2833 B Street, Rosamond, California, is a four-
unit residential building.
ZOO ENTERTAINMENT: Delays Form 10-K for 2011
--------------------------------------------
Zoo Entertainment, Inc., filed a report with the Securities and
Exchange Commission for a 15-day extension, from March 31, 2012,
to April 16, 2012, for filing its annual report on Form 10-K for
the period ended Dec. 31, 2011. The Company has been unable to
complete its evaluation and analysis in certain key areas. These
evaluations and analyses and their implication on the Company's
financial statements have caused the Company to be unable to
timely file, without unreasonable effort and expense, the Form 10-
K. It is anticipated that the Form 10-K will be filed no later
than the fifteenth calendar day, or if that day is not a business
day, the next business day after that day, following the
prescribed due date.
About Zoo Entertainment
Cincinnati, Ohio-based Zoo Entertainment, Inc. (NASDAQ CM: ZOOG)
is a developer, publisher and distributor of interactive
entertainment for Internet-connected consoles, handheld gaming
devices, PCs, and mobile devices.
The Company reported a net loss of $19.74 million on $8.59 million
of revenue for the nine months ended Sept. 30, 2011, compared with
a net loss of $837,000 on $43.71 million of revenue for the same
period during the prior year.
The Company's balance sheet at Sept. 30, 2011, showed $6.19
million in total assets, $13.03 million in total liabilities and a
$6.84 million total stockholders' deficit.
As reported in the TCR on Apr 26, 2011, EisnerAmper LLP, in
Edison, N.J., expressed substantial doubt about Zoo
Entertainment's ability to continue as a going concern, following
the Company's 2010 results. The independent auditors noted that
the Company has both incurred losses and experienced net cash
outflows from operations since inception.
* Moody's Lifts Apparel Industry Outlook to Positive
----------------------------------------------------
Moody's Investors Service has revised its outlook for the US
apparel industry to positive from stable, as apparel companies are
expected to reap benefits from plummeting cotton costs, says a new
report by Moody's Investors Service.
"The cost of cotton has fallen over 60% over the past year and
these benefits will become noticeable and material in the second
half of 2012 and into early 2013," said Scott Tuhy, a Moody's Vice
President -- Senior Analyst, and author of the report. "During the
second half of 2011, apparel manufacturers' gross margins fell by
an average 200 bps, as inputs costs ease, we expect management to
capture a meaningful cost improvement to bolster gross margins."
Moody's expects Gymboree Corp. (B2 negative) and Levi Strauss &
Co. (B1 stable) will benefit the most from declining cotton prices
as their margins took the hardest hits when cotton prices peaked
last year.
Operating income for the US apparel industry is expected to rise
by 7% to 8% in 2012, with the strongest growth in the second half
of the year. That will ease slightly to 5% to 6% in 2013, says
Moody's.
The outlook was revised to positive as Moody's expects the
moderate US recovery to continue, with 2012 GDP predicted to grow
at 1.5-2.5%. Continuing jobs growth and a gradual recovery in
autos and housing should boost growth which Moody's expects will
increase consumer spending with apparel growing in line with total
spending.
Moody's outlook takes into account that the unusually warm winter
- the fourth warmest on record - negatively impacted demand and
forced discounts on seasonal merchandise. Still, consumer memories
of this winter may lead to conservative buying for the fall/winter
of 2012.
In addition, Moody's says that the long-term trend is one of
rising costs as production becomes more expensive with higher
labor costs and increased prices for petroleum-derived synthetic
materials. Economic conditions in Europe and the possibility of a
spike in gas prices remain key risks, says the report.
* BOND PRICING -- For Week From March 26 to 30, 2012
----------------------------------------------------
Company Coupon Maturity Bid Price
------- ------ -------- ---------
AMBAC INC 9.375 8/1/2011 13.400
AMBAC INC 9.500 2/15/2021 17.000
AMBAC INC 7.500 5/1/2023 17.250
AMBAC INC 6.150 2/7/2087 0.688
AES EASTERN ENER 9.000 1/2/2017 24.000
AGY HOLDING COR 11.000 11/15/2014 40.000
AHERN RENTALS 9.250 8/15/2013 56.000
AMER GENL FIN 4.000 4/15/2012 97.000
AMR CORP 9.000 8/1/2012 42.000
AM AIRLN PT TRST 10.180 1/2/2013 67.875
AM AIRLN PT TRST 9.730 9/29/2014 30.750
AMR CORP 6.250 10/15/2014 46.750
AM AIRLN PT TRST 7.379 5/23/2016 31.125
A123 SYSTEMS INC 3.750 4/15/2016 32.250
AQUILEX HOLDINGS 11.125 12/15/2016 40.000
MCDONNELL DOUG 9.750 4/1/2012 100.022
BROADVIEW NETWRK 11.375 9/1/2012 93.500
BLOCKBUSTER INC 11.750 10/1/2014 1.688
BRY-CALL04/12 8.250 11/1/2016 104.250
DELTA AIR 1992B1 9.375 9/11/2017 26.625
DELTA AIR 1993A1 9.875 4/30/2049 20.500
DIRECTBUY HLDG 12.000 2/1/2017 23.000
DELTA PETROLEUM 3.750 5/1/2037 60.000
DUNE ENERGY INC 10.500 6/1/2012 93.500
EASTMAN KODAK CO 7.250 11/15/2013 30.000
EASTMAN KODAK CO 9.950 7/1/2018 26.125
EASTMAN KODAK CO 9.200 6/1/2021 30.000
ENERGY CONVERS 3.000 6/15/2013 53.000
EVERGREEN SOLAR 13.000 4/15/2015 50.000
FIRST METRO 6.900 1/15/2019 15.000
FIRST IND LP 6.875 4/15/2012 97.864
FIBERTOWER CORP 9.000 11/15/2012 21.100
GANNETT CO 6.375 4/1/2012 100.011
GLB AVTN HLDG IN 14.000 8/15/2013 31.375
GMX RESOURCES 5.000 2/1/2013 73.345
GMX RESOURCES 5.000 2/1/2013 74.125
GLOBALSTAR INC 5.750 4/1/2028 55.500
HAWKER BEECHCRAF 8.500 4/1/2015 14.000
HAWKER BEECHCRAF 9.750 4/1/2017 6.500
LEHMAN BROS HLDG 6.000 7/19/2012 29.000
LEHMAN BROS HLDG 5.000 1/22/2013 26.680
LEHMAN BROS HLDG 5.625 1/24/2013 29.625
LEHMAN BROS HLDG 5.100 1/28/2013 27.151
LEHMAN BROS HLDG 5.000 2/11/2013 27.750
LEHMAN BROS HLDG 4.800 2/27/2013 26.000
LEHMAN BROS HLDG 4.700 3/6/2013 27.750
LEHMAN BROS HLDG 5.000 3/27/2013 27.375
LEHMAN BROS HLDG 5.750 5/17/2013 28.250
LEHMAN BROS HLDG 0.450 12/27/2013 27.375
LEHMAN BROS HLDG 5.250 1/30/2014 27.625
LEHMAN BROS HLDG 4.800 3/13/2014 29.500
LEHMAN BROS HLDG 5.000 8/3/2014 25.500
LEHMAN BROS HLDG 6.200 9/26/2014 30.125
LEHMAN BROS HLDG 5.150 2/4/2015 26.760
LEHMAN BROS HLDG 5.250 2/11/2015 27.260
LEHMAN BROS HLDG 8.800 3/1/2015 26.028
LEHMAN BROS HLDG 7.000 6/26/2015 28.125
LEHMAN BROS HLDG 8.500 8/1/2015 27.875
LEHMAN BROS HLDG 5.000 8/5/2015 25.630
LEHMAN BROS HLDG 7.000 12/18/2015 27.750
LEHMAN BROS HLDG 5.500 4/4/2016 29.188
LEHMAN BROS HLDG 8.920 2/16/2017 26.000
LEHMAN BROS HLDG 8.050 1/15/2019 26.025
LEHMAN BROS HLDG 11.000 6/22/2022 26.000
LEHMAN BROS HLDG 11.000 7/18/2022 26.500
LEHMAN BROS HLDG 18.000 7/14/2023 26.250
LEHMAN BROS HLDG 11.000 3/17/2028 26.510
LIFECARE HOLDING 9.250 8/15/2013 73.398
MASHANTUCKET PEQ 8.500 11/15/2015 8.750
MF GLOBAL HLDGS 6.250 8/8/2016 36.500
MF GLOBAL LTD 9.000 6/20/2038 34.750
MANNKIND CORP 3.750 12/15/2013 55.625
MORGAN ST DEAN W 6.600 4/1/2012 100.000
PMI GROUP INC 6.000 9/15/2016 23.250
PENSON WORLDWIDE 8.000 6/1/2014 36.013
REDDY ICE CORP 13.250 11/1/2015 48.410
REAL MEX RESTAUR 14.000 1/1/2013 46.000
RESIDENTIAL CAP 8.500 4/17/2013 31.100
RESIDENTIAL CAP 6.875 6/30/2015 42.000
TEN-CALL04/12 8.125 11/15/2015 104.299
THORNBURG MTG 8.000 5/15/2013 9.000
THQ INC 5.000 8/15/2014 49.500
TOUSA INC 9.000 7/1/2010 20.000
TOUSA INC 9.000 7/1/2010 21.000
TRAVELPORT LLC 11.875 9/1/2016 33.250
TRAVELPORT LLC 11.875 9/1/2016 31.938
TIMES MIRROR CO 7.250 3/1/2013 35.600
TRIBUNE CO 5.250 8/15/2015 35.260
TEXAS COMP/TCEH 7.000 3/15/2013 35.100
TEXAS COMP/TCEH 10.250 11/1/2015 22.000
TEXAS COMP/TCEH 10.250 11/1/2015 19.200
TEXAS COMP/TCEH 10.250 11/1/2015 22.875
TEXAS COMP/TCEH 15.000 4/1/2021 42.000
WESTERN EXPRESS 12.500 4/15/2015 56.000
*********
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
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*** End of Transmission ***