/raid1/www/Hosts/bankrupt/TCR_Public/120619.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Tuesday, June 19, 2012, Vol. 16, No. 169
Headlines
10-16 MANHATTAN: Court OKs Hiring of Landlord-Tenant Counsel
10-16 MANHATTAN: Files Schedules of Assets and Liabilities
10-16 MANHATTAN: July 16 Fixed as General Claims Bar Date
15-35 HEMPSTEAD: Chapter 11 Trustee Seeks Case Dismissal
829 REALTY: Files List of 20 Largest Unsecured Creditors
ADVANCED ACQUISITIONS: Voluntary Chapter 11 Case Summary
AE BIOFUELS: Third Eye Extends Note Maturity to October
AGRO INDUSTRIAL: Lack of Information Cues Fitch to Withdraw Rating
ALLIED SYSTEMS: Meeting to Form Creditors' Panel on June 19
AMERICAN AIRLINES: APA, AFPA Continue to Fight Bid to Scrap CBAs
AMERICAN AIRLINES: Bondholders Asked to Study Stand-Alone Plan
AMERICAN AIRLINES: Blocks PSAs' Union-Representation Election
AMERICAN AIRLINES: Has Settlement With HP Enterprise
AMERICAN AIRLINES: Asks for Extension of Lease Decision Deadline
AMERICAN MEDICAL: Spars With U.S., Burns Cash
AMERICAN WEST: Field Law Approved as FCR James Moore's Counsel
AMIN'S OIL: Case Summary & 15 Largest Unsecured Creditors
AOP INTERNATIONAL: Case Summary & 20 Largest Unsecured Creditors
ATRINSIC INC: Case Summary & 20 Largest Unsecured Creditors
BERNARD L. MADOFF: Judge OKs Settlement for Hispanic Investors
BERNARD L. MADOFF: Trustee Facing Dismissal Under Swap Defense
BHFS I LLC: Case Summary & 7 Largest Unsecured Creditors
BIG THOMPSON: Case Summary & 7 Largest Unsecured Creditors
BLUE RAVEN: Leading Ridge to Buy Business for $1.4 Million
BONDS.COM GROUP: GFINet Discloses 60.8% Equity Stake
BONDS.COM GROUP: Oak Investment Discloses 68.7% Equity Stake
BONDS.COM GROUP: Michel Daher Discloses 73.3% Equity Stake
BOWLES SUB: Wants Access to Wells Fargo Cash Until Nov. 30
BUFFETS INC: Closes Springfield, Ill. Outlet
CENTRAL FALLS: City Council Members' Bid to Oust Receiver Fails
CIRCUS AND ELDORADO: U.S. Trustee Forms 3-Member Creditors Panel
CHINA TEL GROUP: Unregistered Securities Sale Exceed 5% Threshold
CHRIST THE ROCK: Files for Chapter 11 Protection to Avoid Takeover
CHRISTOPHER TSCHERNE: Voluntary Chapter 11 Case Summary
CLIFFS CLUB: Asks for Plan Exclusivity Until Oct. 1
COMSTOCK MINING: Accused of Using Land Without Authorization
COVERDELL ENTERPRISES: Case Summary & 6 Largest Unsec Creditors
CULINARY HEALTH: Case Summary & 19 Largest Unsecured Creditors
DESERT GARDENS: US Bank Wants Disclosure Statement Disapproved
DEWEY & LEBOEUF: Agrees to End Employee Pensions
DIAMOND BEACH: July 2 Hearing Set for Request to Use DIP Financing
DIPPIN' DOTS: Court Signs Stipulation for Cash Collateral Use
DRI INC: Digital Sign Business Auctioned for $25.3 Million
ENERGY CONVERSION: Court Denies Panel's Request to End Exclusivity
ENERGY SOLUTIONS: S&P's "B" Rating is Above Moody's
FIRST NATIONAL: Court Dismisses Chapter 11 Reorganization Case
FOUR SEASONS: Chapter 11 Reorganization Case Dismissed
GAMETECH INT'L: Delays Form 10-Q for April 29 Quarter
GATEHOUSE MEDIA: Peter Newton Joins as Unit President
GENERAL AUTO BUILDING: Files Schedules of Assets and Liabilities
GENTA INC: Offering Amount Under Purchase Pact Hiked to $16-Mil.
GENTA INC: Board Grants 2-Bil. Restricted Shares to Executives
GENTA INC: Has 4.8 Billion Outstanding Common Shares
GLOBAL AVIATION: Asks Court Approval of Employee Retention Plan
H&M OIL: Files Schedules of Assets and Liabilities
HALE MOKU: June 28 Hearing Set for Case Dismissal/Conversion Plea
H&M OIL: Wants to Hire Lain Faulkner as Financial Advisors
HAWKER BEECHCRAFT: Gets Final OK to Incur $400MM Delayed Draw Loan
HEALTHCARE OF FLORENCE: E&M Wants Cash Collateral Use Prohibited
HEART HOUSE: Case Summary & 6 Largest Unsecured Creditors
HEARTHSTONE HOMES: Court OKs Prudential as Listing Agent
HEARTHSTONE HOMES: Court OKs Jack Nitz & Associates as Auctioneers
HEMCON MEDICAL: Has Until July 2 to Propose Chapter 11 Plan
HORIZON LINES: Moody's Affirms 'Caa2' CFR/PDR; Outlook Stable
HORIZON VILLAGE: Wins Extension of Exclusive Solicitation Period
HOUGHTON MIFFLIN: Hearing on Case Venue Transfer Set for June 18
HUMPUSS SEA: U.S. Bankruptcy Court Recognizes Singapore Proceeding
HUSSEY COPPER: Disclosure Statement Hearing on June 26
INDIGO-ENERGY: Stanley Teeple Resigns as Director and CFO
INTERNATIONAL LEASE: Moody's Lifts CFR to 'Ba3'; Outlook Stable
KEOWEE FALLS: Files Amended Schedules of Assets & Liabilities
KEY WEST: Case Summary & 7 Largest Unsecured Creditors
LEVI STRAUSS: Completes Tender Offer, Elects to Redeem Notes
LIBERATOR INC: Webb Replaces Gruber as Accountant
LIGHTSQUARED INC: Alvarez & Marsal Approved as Financial Advisor
LIGHTSQUARED INC: Fraser Milner Wins Court OK as Canadian Counsel
LIGHTSQUARED INC: Kirkland & Ellis OK'd as Litigation Counsel
LIGHTSQUARED INC: Milbank Tweed Approved as Bankruptcy Counsel
LIGHTSQUARED INC: Moelis & Company Approved as Investment Banker
LITHIUM TECHNOLOGY: Timothy Ryder Resigns as CFO
LUMBER PRODUCTS: Court OKs Edward Hostmann as Chapter 11 Trustee
LUMBER PRODUCTS: Court OKs Tonkon Torp as Ch.11 Trustee's Counsel
LUMBER PRODUCTS: Court OKs Kiemle & Hagood as Real Estate Broker
MAKENA GREAT: Claims Bar Date Set for June 29
MARCO POLO: Plan for Dutch Ship Owner Set for Aug. 14 Approval
MARIANA RETIREMENT FUND: Bankr. Judge Ensures Payment for Lawyers
MCM RESORT: Case Summary & 12 Largest Unsecured Creditors
MORGANS HOTEL: Nine Directors Elected at Annual Meeting
MSR RESORT: Midland Loan Consents to Cash Use Until Sept. 1
MUNSTER MARATHON: Case Summary & 8 Largest Unsecured Creditors
NATIONAL QUALITY: Incurs $139,000 Net Loss in First Quarter
NEC HOLDINGS: Trustee Works Out Deal for Contaminated Plant
NEW ENGLAND BUILDING: US Trustee Names 7-Member Creditors Panel
NEWPAGE CORP: Reaches New Deal With Unions
NORTHERN CALIFORNIA BANCORP: Reports $1.1MM Net Income in Q1
NOVA CHEMICAL: Fitch Raises Rating on Sr. Unsecured Debt to 'BB'
NOVASOLAR INC: Case Summary & 20 Largest Unsecured Creditors
NUNEZ NORTE: Case Summary & 20 Largest Unsecured Creditors
OMEGA NAVIGATION: Cash Collateral Hearing Continued Until June 18
ORAGENICS INC: Koski Family Discloses 62.4% Equity Stake
PAIRPOINT GLASS: Case Summary & 20 Largest Unsecured Creditors
PATHEON: Weak Liquidity No Impact on Moody's 'B3' CFR
PDQ COOLIDGE: Court OKs Use of Fannie Mae Cash Collateral
PDQ COOLIDGE: Files Schedules of Asset and Liabilities
PET RESORTS: Case Summary & 20 Largest Unsecured Creditors
PINNACLE AIRLINES: Maturity of CIT Term Loan Extended to 2014
QUALTEQ INC: Court Appoints Fred C. Caruso as Ch. 11 Trustee
REDDY ICE: Court OKs Wylie Suit to Proceed Despite Plan Injunction
RG STEEL: Trade Suppliers, PBGC, Steelworkers on Committee
ROCK POINTE: Southwell & O'Rourke Approved as Bankruptcy Counsel
ROOMSTORE INC: Gets OK to Place Remaining Stores on the Block
ROSETTA GENOMICS: Perkins Capital Owns 15,767 Common Shares
S. WHITE TRANSPORTATION: Objected Mortgage Survives Chapter 11
SADLER CLINIC: Case Summary & 20 Largest Unsecured Creditors
SAFE TRAFFIC: Case Summary & 20 Largest Unsecured Creditors
SALUTARIS DIALYSIS: Case Summary & 14 Largest Unsecured Creditors
SB PARTNERS: Incurs $1 Million Net Loss in 2011
SEQUOIA PARTNERS: Gets OK to Obtain Loan for Property Appraisal
SHARED MARKETING: Case Summary & 20 Largest Unsecured Creditors
SHERIDAN HOLDINGS: Moody's Rates $670MM Credit Facilities 'B1'
SHOREBANK CORP.: Wins Confirmation of Chapter 11 Plan
SOLAR TRUST: BrightSource's $10MM Bid for 500-MW Solar Plant OK'd
SOLAR TRUST: Global Finance Challenges Ownership
SOLYNDRA LLC: Has Tentative Deal With Creditors; To File Plan Soon
SOUPMAN INC: Timothy Gannon Joins as Senior Executive & Director
SPECTRE PERFORMANCE: K&N Judgment Appeal Result Cues Plan Duration
SPRING NAUD: Case Summary & 9 Largest Unsecured Creditors
SPRING POINT: Second Amended Chapter 11 Plan Approved by Judge
TALON INTERNATIONAL: Five Directors Re-Elected at Annual Meeting
TAYLOR BEAN: Former Exec Gets 5 Years for Role in $3-Bil. Fraud
TEN SAINTS: Bancroft & John OK'd to Appeal 2012-2013 Tax Value
TIC MEMPHIS: Case Summary & 4 Largest Unsecured Creditors
TMD FRICTION: Moody's Affirms 'B2' Corp. Family Rating
TOBACCO SQUARE: Case Summary & 20 Largest Unsecured Creditors
TODD BRUNNER: Largest Creditor Seeks Contempt, Jail Time
TOTES ISOTONER: Moody's Affirms 'B3' CFR'; Outlook Stable
TRIAD GUARANTY: Five Directors Elected at Annual Meeting
TWIN CITY: Case Summary & 20 Largest Unsecured Creditors
US EAGLE: Can Continue Using Bank's Cash; Golf Products Unit Sold
US EAGLE: Hires Jones Lang LaSalle Americas as Real Estate Broker
US EAGLE: Seeks to Hire Commerce CRG to Lease Vegas Property
US FIDELIS: Co-Owner Pleads Guilty to Insurance, Consumer Fraud
VELO HOLDINGS: Inks Deal with Wilmington Trust on Retainer Fee
VHGI HOLDINGS: Incurs $5.4 Million Net Loss in First Quarter
VICTORIA FALLS: Moody's Raises Rating on Class D Notes to 'Ba2'
VITRO SAB: Judge Voids Entire Reorganization in the U.S.
WAGNER SQUARE: Involuntary Chapter 11 Case Summary
WASTE2ENERGY HOLDINGS: Files Schedules of Assets and Liabilities
WEST PENN: Moody's Affirms 'Caa1' Bond Rating; Outlook Negative
WHITE KNOLL VENTURE: Files Schedules of Assets and Liabilities
WILCOX EMBARCADERO: Plan Outline Hearing Slated for June 26
XTREME IRON: Voluntary Chapter 11 Case Summary
ZOO ENTERTAINMENT: David Smith Discloses 75% Equity Stake
* Absolute Priority Survives in Individual Chapter 11s
* False 'Financial Condition' Refers to Net Worth
* Chapter 13 Can't Modify Mortgage More than Five Years
* Increased Use of Bankruptcy Petition Preparers Raises Concerns
* Moody's Says US Life Insurers' Credit Losses Decline Further
* S&P's Global Corporate Default Tally Rises to 34
* K&L Gates' B. Finkelstein Moves to Dykema Gossett in Dallas
* Year's Bank Failures Hit 31 After 3 Failed Friday
* Large Companies With Insolvent Balance Sheets
*********
10-16 MANHATTAN: Court OKs Hiring of Landlord-Tenant Counsel
------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
authorized 10-16 Manhattan Avenue LLC, et al., to employ Green &
Cohen, PC and Fischman & Fischman as special landlord-tenant
counsel, nunc pro tunc to the petition date.
As reported in the Troubled Company Reporter on May 31, 2012, the
law firms of Green & Cohen, and Fischman & Fischman will assist
the Debtors in connection with a multitude of landlord-tenant
proceedings that were commenced by them prior to the bankruptcy
filing date, or that Bluestar Properties, Inc., the Debtors'
property manager, intends to commence subsequent to the Petition
Date, against non-paying and holdover tenants residing in the
Debtors' properties.
The Debtors will pay the Firms at each firm's usual and customary
rates. The Firms also will be reimbursed for their reasonable
out-of-pocket disbursements. Any payments made to G&C and
Fischman, individually, will not exceed $10,000 per month and
$40,000 for the entire period in which the Debtors' cases are
pending.
Jason Green, Esq., a member of Green & Cohen P.C., and Doreen J.
Fishchman, Esq., a member of Fischman & Fischman, P.C., represent
that their respective firm, its members, and associates have no
other connection with the Debtors, their creditors, any other
party in interest, their respective attorneys or accountants, the
United States Trustee, or any person employed in the Office of the
United States Trustee.
About 10-16 Manhattan Avenue
10-16 Manhattan Avenue LLC and 32 other entities, which own
residential apartment buildings in Manhattan, filed Chapter 11
bankruptcy petitions in Manhattan (Bankr. S.D.N.Y. Case Nos.
12-12261, 12-12264 to 12-12295) on May 24, 2012. The Debtors are
owned by Praedium Fund VI, L.P. and Pinnacle Management Co. LLC.
Each Debtor claims to be a Single Asset Real Estate as defined in
11 U.S.C. Sec. 101(51B) and owns a residential apartment building
that largely consists of rent-controlled and rent-stabilized
apartments. The sole and managing member for each Debtor is PMM
Associates D-FXD LLC.
The Properties primarily are located in the Manhattan Valley
section of Manhattan in the low 100's on Riverside Drive and near
Central Park West. The Debtors purchased the Properties in 2005.
Judge Allan L. Gropper presides over the case. Sanford P. Rosen,
Esq., and Nancy Lynne Kourland, Esq., at Rosen & Associates, P.C.,
serve as the Debtors' counsel.
Each Debtor's chapter 11 petition and corresponding schedules and
statement of financial affairs reflects an estimated fair market
value of the properties of $119 million; however, the value of the
Properties may be as high as $140 million, according to a court
filing. The Debtors owe lender DG UWS Sub LLC $192.1 million in
principal plus $37.7 million in unpaid interest.
The Debtor's Pre-Negotiated Plan, included terms of the Settlement
Agreement which provides that (a) the Debtors will transfer,
subject to the Mortgage and all of the Properties' residential
leases, all of their title to and interest in each of the
Properties to a "buyer" designated by DG and (b) release DG,
Bluestar, and each of DG's designated buyers from all claims that
the Debtors have or could have asserted against them.
10-16 MANHATTAN: Files Schedules of Assets and Liabilities
----------------------------------------------------------
10-16 Manhattan Avenue LLC filed with the U.S. Bankruptcy Court
for the Southern District of New York its schedules of assets and
liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $7,600,000
B. Personal Property $60,186
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $229,861,045
E. Creditors Holding
Unsecured Priority
Claims $100
F. Creditors Holding
Unsecured Non-priority
Claims $10,104
----------- -----------
TOTAL $7,160,877 $229,871,250
A full-text copy of the schedules is available for free at:
http://bankrupt.com/misc/10-16_MANHATTAN_sal.pdf
About 10-16 Manhattan Avenue
10-16 Manhattan Avenue LLC and 32 other entities, which own
residential apartment buildings in Manhattan, filed Chapter 11
bankruptcy petitions in Manhattan (Bankr. S.D.N.Y. Case Nos.
12-12261, 12-12264 to 12-12295) on May 24, 2012. The Debtors are
owned by Praedium Fund VI, L.P. and Pinnacle Management Co. LLC.
Each Debtor claims to be a Single Asset Real Estate as defined in
11 U.S.C. Sec. 101(51B) and owns a residential apartment building
that largely consists of rent-controlled and rent-stabilized
apartments. The sole and managing member for each Debtor is PMM
Associates D-FXD LLC.
The Properties primarily are located in the Manhattan Valley
section of Manhattan in the low 100's on Riverside Drive and near
Central Park West. The Debtors purchased the Properties in 2005.
Judge Allan L. Gropper presides over the case. Sanford P. Rosen,
Esq., and Nancy Lynne Kourland, Esq., at Rosen & Associates, P.C.,
serve as the Debtors' counsel.
Each Debtor's chapter 11 petition and corresponding schedules and
statement of financial affairs reflects an estimated fair market
value of the properties of $119 million; however, the value of the
Properties may be as high as $140 million, according to a court
filing. The Debtors owe lender DG UWS Sub LLC $192.1 million in
principal plus $37.7 million in unpaid interest.
The Debtor's Pre-Negotiated Plan, included terms of the Settlement
Agreement which provides that (a) the Debtors will transfer,
subject to the Mortgage and all of the Properties' residential
leases, all of their title to and interest in each of the
Properties to a "buyer" designated by DG and (b) release DG,
Bluestar, and each of DG's designated buyers from all claims that
the Debtors have or could have asserted against them.
10-16 MANHATTAN: July 16 Fixed as General Claims Bar Date
---------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
established July 16, 2012, as the deadline for any individual or
entity to file proofs of claim against 10-16 Manhattan Avenue LLC,
et al.
The Court also ordered that Nov. 20, is the deadline for proofs of
claim filed by governmental units.
About 10-16 Manhattan Avenue
10-16 Manhattan Avenue LLC and 32 other entities, which own
residential apartment buildings in Manhattan, filed Chapter 11
bankruptcy petitions in Manhattan (Bankr. S.D.N.Y. Case Nos.
12-12261, 12-12264 to 12-12295) on May 24, 2012. The Debtors are
owned by Praedium Fund VI, L.P. and Pinnacle Management Co. LLC.
Each Debtor claims to be a Single Asset Real Estate as defined in
11 U.S.C. Sec. 101(51B) and owns a residential apartment building
that largely consists of rent-controlled and rent-stabilized
apartments. The sole and managing member for each Debtor is PMM
Associates D-FXD LLC.
The Properties primarily are located in the Manhattan Valley
section of Manhattan in the low 100's on Riverside Drive and near
Central Park West. The Debtors purchased the Properties in 2005.
Judge Allan L. Gropper presides over the case. Sanford P. Rosen,
Esq., and Nancy Lynne Kourland, Esq., at Rosen & Associates, P.C.,
serve as the Debtors' counsel.
Each Debtor's chapter 11 petition and corresponding schedules and
statement of financial affairs reflects an estimated fair market
value of the properties of $119 million; however, the value of the
Properties may be as high as $140 million, according to a court
filing. The Debtors owe lender DG UWS Sub LLC $192.1 million in
principal plus $37.7 million in unpaid interest.
The Debtor's Pre-Negotiated Plan, included terms of the Settlement
Agreement which provides that (a) the Debtors will transfer,
subject to the Mortgage and all of the Properties' residential
leases, all of their title to and interest in each of the
Properties to a "buyer" designated by DG and (b) release DG,
Bluestar, and each of DG's designated buyers from all claims that
the Debtors have or could have asserted against them.
15-35 HEMPSTEAD: Chapter 11 Trustee Seeks Case Dismissal
--------------------------------------------------------
Karen L. Gilman, Esq., the Chapter 11 Trustee for 15-35 Hempstead
Properties LLC and Jackson 299 Hempstead LLC, seeks dismissal of
the Debtors' chapter 11 cases.
The Chapter 11 Trustee also seeks authority to transfer to Michael
J. Viscount, as disbursing agent, those funds available for pro
rata distribution to creditors holding allowed general unsecured
claims; and for an order authorizing the Official Committee of
Unsecured Creditors to prosecute objections to claims.
The Chapter 11 Trustee seeks to provide for the disbursement of
$82,695 on a pro rata basis to creditors holding allowed general
unsecured claims.
All meaningful assets of the Debtors' estates have been
liquidated. There are no known un-administered assets, and no
secured creditors whose deficiency claims have not been waived or
re-classified as general unsecured claims.
About 15-35 Hempstead Properties
15-35 Hempstead Properties LLC and affiliate Jackson 299 Hempstead
LLC owned real property at 101 Boardwalk in Atlantic City, New
Jersey. They filed for Chapter 11 bankruptcy protection (Bankr.
D. N.J. Case Nos. 10-43178 and 10-43180) on Oct. 26, 2010. Albert
A. Ciardi, III, Esq., at Ciardi Ciardi & Astin, serves as counsel
to the Debtors. The Debtors each estimated assets and debts at
$10 million to $50 million.
829 REALTY: Files List of 20 Largest Unsecured Creditors
--------------------------------------------------------
829 Realty LLC filed with the U.S. Bankruptcy Court for the
Eastern of New York a list of of creditors holding 20 largest
unsecured claims.
Name of Creditor Nature of Claim Amount
---------------- --------------- ------
Arsh General Construction Services Rendered $12,860
Low Voltage Solutions Services Rendered $6,565
National Grid Services Rendered $6,447
Empire State Supply Services Rendered $4,332
Full Line Hardware Services Rendered $4,149
Roth & Company Services Rendered $3,500
Reliable Exterminating, Inc. Services Rendered $2,743
Fairmont Insurance Services Rendered $2,206
About 829 Realty LLC
Brooklyn, New York-based 829 Realty LLC was placed in involuntary
Chapter 11 bankruptcy (Bankr. E.D.N.Y. Case No. 12-41415) on
Feb. 28, 2012. Judge Jerome Feller presides over the case. Four
creditors, allegedly owed $27,900 in the aggregate, filed the
petition. The creditors are Arsh General Construction, Low
Voltage Solutions, Empire State Supply, and Full Line Hardware.
The petitioning creditors are represented by Gary F. Herbst, Esq.,
at LaMonica Herbst and Maniscalco.
The Bankruptcy Court entered an Order for Relief under Chapter 11
on March 30, 2012. Pursuant to the Order, the Chapter 11 Plan and
Disclosure Statement are due by July 30, 2012.
The Debtor hired Marc L. Hamroff, Esq., and Theresa A. Driscoll,
Esq. -- mhamroff@moritthock.com and tdriscoll@moritthock.com -- at
Moritt Hock & Hamroff LLP, as Chapter 11 counsel. The Debtor
disclosed $19,564,699 in assets and $7,191,109 in liabilities as
of the Chapter 11 filing.
ADVANCED ACQUISITIONS: Voluntary Chapter 11 Case Summary
--------------------------------------------------------
Debtor: Advanced Acquisitions, LLC
2260 State Road
Bensalem, PA 19020
Bankruptcy Case No.: 12-15819
Chapter 11 Petition Date: June 15, 2012
Court: United States Bankruptcy Court
Eastern District of Pennsylvania (Philadelphia)
Judge: Bruce I. Fox
Debtor's Counsel: Aris J. Karalis, Esq.
Robert W. Seitzer, Esq.
MASCHMEYER KARALIS P.C.
1900 Spruce Street
Philadelphia, PA 19103
Tel: (215) 546-4500
E-mail: akaralis@cmklaw.com
rseitzer@cmklaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor did not file a list of its largest unsecured creditors
together with its petition.
The petition was signed by John Melching, managing member.
Affiliate that filed separate Chapter 11 petition:
Petition
Debtor Case No. Date
------ -------- ----
American Architectural, Inc. 12-15818 06/15/12
AE BIOFUELS: Third Eye Extends Note Maturity to October
-------------------------------------------------------
Aemetis Advanced Fuels Keyes, Inc., a subsidiary of Aemetis,
Inc.(formerly known as AE Biofuels, Inc.), entered into a Limited
Waiver and Amendment No. 7 to the Note Purchase Agreement with
Third Eye Capital Corporation as Agent, and Third Eye Capital
Credit Opportunities Fund - Insight Fund, Sprott Private Credit
Fund L.P. and Sprott PC Trust. Pursuant to the Seventh Amendment,
Agent and Purchasers agreed to extend the maturity date of the
Note to Oct. 18, 2012, with a provision for an additional six
month period extension for an extension fee to be determined
later. Agent and Purchasers agreed to waive the Minimum Quarterly
Free Cash Flow covenant and the Cilion Plant Minimum Quarterly
Production covenant for the quarters ended June 30, 2012. In
return, the Company agreed to pay an amendment fee of $213,000 and
issue 1,000,000 shares of the Company's common stock to the
Purchasers. As of May 14, 2012, the principal balance and all
accrued and unpaid interest and fees outstanding on the Note was
$7,086,580 and the accrued and unpaid Revenue Participation was
$7,695,989. Upon execution of the Seventh Amendment, the
principal balance and all accrued and unpaid interest and fees
outstanding on the Note will increase to $7,908,989.
On May 17, 2012, Aemetis, Inc., entered into a Letter Agreement in
re Note and Warrant Purchase Agreement made as of May 16, 2008, as
amended, among the Company, Agent and Third Eye Capital Credit
Opportunities Fund - ABL Opportunities Fund pursuant to which the
Company purchased an additional note in the original principal
balance of $840,000, for the aggregate purchase price of $700,000.
As of May 17, 2012, the principal balance and all accrued and
unpaid interest and fees outstanding on the Notes, including the
note purchased under the Letter Agreement was $7,143,036.
About AE Biofuels
AE Biofuels, Inc. (OTC BB: AEBF) -- http://www.aebiofuels.com/--
is a biofuels company based in Cupertino, California, developing
sustainable solutions to address the world's renewable energy
needs. The Company is commercializing its patent-pending next-
generation cellulosic ethanol technology that enables the
production of biofuels from both non-food and traditional
feedstocks. Its wholly-owned Universal Biofuels subsidiary built
and operates a nameplate 50 million gallon per year biodiesel
production facility on the east coast of India.
The Company reported a net loss of $1.72 million on $1.59 million
of sales for the three months ended Sept. 30, 2010, compared with
a net loss of $3.78 million on $4.05 million of sales for the same
period a year earlier.
BDO Seidman, LLP, in San Jose, Calif., expressed substantial doubt
about AE Biofuels' ability to continue as a going concern,
following the Company's 2009 results. The independent auditors
noted that the Company has incurred recurring losses, and has a
working capital deficit and total stockholders' deficit as of
December 31, 2009.
The Company's balance sheet at Sept. 30, 2010, showed
$20.23 million in total assets, $29.03 million in total
liabilities, all current, and a stockholders' deficit of
$8.80 million. The Company has not filed financial reports after
filing its Form 10-Q for the quarter ended Sept. 30, 2010.
AGRO INDUSTRIAL: Lack of Information Cues Fitch to Withdraw Rating
------------------------------------------------------------------
Fitch Ratings has withdrawn Agro Industrial Vista Alegre Ltda's
(Usina Vista Alegre or UVA) foreign and local currency Issuer
Default Ratings (IDR) 'B-' and long-term National Scale ratings
'BBB-(bra)'.
Fitch has also withdrawn its 100% owned subsidiary UVA Overseas
LTD. I (UVA Overseas) foreign and local currency IDRs 'B-'.
These ratings have been withdrawn due to lack of information.
Fitch will no longer provide ratings or analytical coverage on UVA
or UVA Overseas.
ALLIED SYSTEMS: Meeting to Form Creditors' Panel on June 19
-----------------------------------------------------------
Roberta A. DeAngelis, United States Trustee for Region 3, will
hold an organizational meeting on June 19, 2012, at 1:00 p.m. in
the bankruptcy case of Allied Systems Holdings, Inc., et al. The
meeting will be held at:
J. Caleb Boggs Federal Building
844 King Street, Room 2112
Wilmington DE 19801
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.
About Allied Systems
BDCM Opportunity Fund II, LP, Spectrum Investment Partners LP, and
Black Diamond CLO 2005-1 Adviser L.L.C., filed involuntary
petitions for Allied Systems Holdings Inc. and Allied Systems Ltd.
(Bankr. D. Del. Case Nos. 12-11564 and 12-11565) on May 17, 2012.
The signatories of the involuntary petitions assert claims of at
least $52.8 million for loan defaults by the two companies.
Allied Systems, through its subsidiaries, provides logistics,
distribution, and transportation services for the automotive
industry in North America.
Allied Holdings Inc. previously filed for chapter 11 protection
(Bankr. N.D. Ga. Case Nos. 05-12515 through 05-12537) on July 31,
2005. Jeffrey W. Kelley, Esq., at Troutman Sanders, LLP,
represented the Debtors in the 2005 case. Allied won confirmation
of a reorganization plan and emerged from bankruptcy in May 2007
with $265 million in first-lien debt and $50 million in second-
lien debt.
The petitioning creditors said Allied has defaulted on payments of
$57.4 million on the first lien debt and $9.6 million on the
second. They hold $47.9 million, or about 20% of the first-lien
debt, and about $5 million, or 17%, of the second-lien obligation.
They are represented by Adam G. Landis, Esq., and Kerri K.
Mumford, Esq., at Landis Rath & Cobb LLP; and Adam C. Harris,
Esq., and Robert J. Ward, Esq., at Schulte Roth & Zabel LLP.
Allied Systems Holdings Inc. formally put itself and 18
subsidiaries into bankruptcy reorganization June 10, 2012,
following the filing of the involuntary Chapter 11 petition.
The Company is being advised by the law firms of Troutman Sanders,
Gowling Lafleur Henderson, and Richards Layton & Finger.
The bankruptcy court process does not include captive insurance
company Haul Insurance Limited or any of the Company's Mexican or
Bermudan subsidiaries. The Company also announced that it intends
to seek foreign recognition of its Chapter 11 cases in Canada.
AMERICAN AIRLINES: APA, AFPA Continue to Fight Bid to Scrap CBAs
----------------------------------------------------------------
AMR Corporation, American Airlines Inc. and their debtor
affiliates seek permission from Judge Sean H. Lane of the U.S.
Bankruptcy Court for the Southern District of New York to enter
into new collective bargaining agreements with the Transport
Workers Union of America, AFL-CIO, on behalf of these five
employee groups: (1) Flight Dispatchers and Dispatchers'
Assistants; (2) Fleet Service Employees and Ground Service
Employees; (3) Ground School and Pilot Simulator Instructors; (4)
Maintenance Control Technician Employees; and (5) Flight Simulator
Technicians, Association Simulator Technicians, Technical
Coordinators.
The Debtors clarify that they are neither seeking to assume the
prepetition CBAs with the TWU, nor to convert any prepetition
claims into postpetition claims.
Harvey R. Miller, Esq., at Weil, Gotshal & Manges LLP, in New
York, says the new CBAs were reached after extensive arm's-length
negotiations. To ensure that the employees covered by the new
CBAs are treated fairly and equitably with all other employee
groups -- both union and non-union-- the parties have agreed that
the new CBAs will take effect only if American secures the
ability to modify the labor contracts covering the other
unionized employees that are reasonably projected to produce the
targets for labor cost savings specified in this motion, either
by consensual agreements with the unions or by rejection of the
CBAs in the Section 1113 process, he states.
By means of so-called "me too" provisions included in a side
letter to each of the new CBAs, American and TWU have agreed that
if American and the non-TWU-represented work groups reach
consensual agreements which provide labor cost savings less than
the targeted savings, American and TWU will agree to
proportionate reductions in the targeted labor cost savings in
the new CBAs, Mr. Miller notes.
In February, American presented its Business Plan that provided
for labor cost reductions from all of American's unionized and
non-union employees, including management and support staff.
American then presented proposals pursuant to Section 1113 to the
TWU for each of the seven work groups that met the Company's
labor cost reduction goals. The cost reductions sought from each
TWU-represented work group are as follows:
TWU Contract Group Annual Cost Reductions Needed
------------------ -----------------------------
M&R $212 million
Fleet Service $152.4 million
MCT $3.4 million
Instructors $2.154 million
Stock Clerks $20 million
Sim Techs $1.7 million
Dispatch $3.239 million
TWU and American thereafter engaged in extensive bargaining
regarding these Section 1113 Proposals. In March, American filed
a motion to reject its CBAs with its three unions: the Allied
Pilots Association, Association of Professional Flight Attendants,
and TWU. American and TWU then continued to negotiate as required
by Section 1113(b)(2), and continued to negotiate even after the
hearing on the Sec. 1113 Motion began on April 23, 2012. On May
10, 2012, TWU sent out for a vote on ratification settlement
proposals from American in the form of new CBAs for each work
group. On May 15, 2012, TWU reported that five of the seven
employee groups had ratified the proposed CBAs: Fleet Service,
Dispatch, MCTs, Instructors and Sim Techs.
The current status of the CBAs with all seven TWU groups is set
forth:
TWU Contract Effective date of Amendable date Ratified
Group Current CBA of Current CBA Agreement
------------ ----------------- -------------- ---------
M&R April 15, 2003 April 30, 2008 No
Fleet Service April 15, 2003 April 30, 2008 Yes
MCT May 5, 2010 May 5, 2013 Yes
Instructors October 1, 2011 April 1, 2015 Yes
Stock Clerks April 15, 2003 April 30, 2008 No
Sim Techs April 15, 2003 April 30, 2008 Yes
Dispatch April 15, 2003 April 30, 2008 Yes
Ratified CBAs
"The five ratified CBAs contain modifications that meet the
proposed labor cost reductions that are necessary for the success
of American's restructuring," Mr. Miller says. Each CBA is
summarized as follows:
A) The Dispatch CBA provides for work rule changes, including:
(1) elimination of restrictions on regional flying; (2)
elimination of system and station job protections that
currently limit the Company's ability to lay off protected
employees; (3) reduction of annual vacation accrual and
elimination of paid personal vacation days; (4) modification
of the work schedule; and (5) elimination of the special
moving allowance given to employees who are laid off. It
provides for structural pay increases and continues the
current performance-base pay program.
B) The Sim Tech CBA provides for work rule changes, including:
(1) elimination of restrictions on regional flying; (2)
elimination of system and station job protections currently
limit the Company's ability to lay off protected employees;
(3) elimination of paid holidays in exchange for five paid
days off to be approved at management discretion; (4)
elimination of paid personal vacation days; and (5) changes
to the per diem allowance. It also provides for structural
pay increases.
C) The Instructors CBA provides for work rule changes,
including: (1) elimination of system and station job
protections that currently limit the Company's ability to lay
off protected employees; (2) modification of procedures for
filling flight simulator seats; (3) reduction of overtime pay
rate; (4) modifications to monthly work schedule; (5)
reduction of paid holidays; and (6) elimination of paid
personal vacation days. It also provides for structural pay
increases.
D) The Fleet Service CBA provides for work rule changes,
including: (1) outsourcing dayline cabin cleaning, cargo
handling at most stations, mail handling, interline cargo,
fueling, bus driving, and American Eagle bag transfer work
and reassigning some work currently done by Fleet Service
Clerks in Tulsa to TWU-represented M&R employees; (2)
elimination of system and station job protections that
currently limit the Company's ability to lay off protected
employees; (3) elimination of restrictions on regional
flying; (4) reduction of longevity pay premium; (5)
modification of station staffing departure threshold
governing which stations must be staffed with TWU-represented
employees; (6) modification of holiday pay procedures so that
employee is paid for a holiday only when working on that
holiday; (7) reduction in maximum annual vacation accrual and
elimination of paid personal vacation days; and (8)
eliminating the special moving allowance given to laid off
employees. It also provides for an initial reduction in base
pay scales, followed by structural pay increases to those
current levels.
E) The MCT CBA provides for work rule changes, including: (1)
elimination of restrictions on regional flying; (2)
elimination of system and station job protections that
currently limit the Company's ability to lay off protected
employees; (3) giving the Company the ability to relocate
work groups; (4) reduction of the overtime and holiday pay
premiums; (5) reduction of maximum annual vacation accrual;
(6) reduction of the number of years that furloughed
employees retain recall rights; and elimination of paid
holidays; and (7) elimination of the special moving allowance
given to laid off employees.
In addition to the work rule changes specific to each CBA, these
CBAs contain common provisions that are identical across all
union-represented groups. These include a freeze of the current
defined benefit pension plan and implementation of a 401(k) plan;
universal changes to active and retiree medical benefits;
implementation of a profit-sharing plan; and a six-year duration
from the effective date.
Clean and blacklined copies of the new CBAs are available for
free at http://bankrupt.com/misc/AmAir_0614TWUCBAs.pdf
The Court will consider the Debtors' request on June 28, 2012.
Objections are due no later than June 21.
Unions Continue to Fight American's
Section 1113 Motion
The Allied Pilots Association and the Association of Professional
Flight Attendants ask Judge Lane to deny American's motion to
reject their collective bargaining agreements for failure to
satisfy its burden under Section 1113.
They criticized American's stand-alone plan as flawed. Instead,
they want American to consider US Airways' merger bid that could
offset the need for concessions demanded by American from the
labor groups.
A. APA
Edgar N. James, Esq., at James & Hoffman, P.C., in Washington,
D.C., counsel to the APA, notes that neither the APA's $460
million valuation nor American's $370 million calculation
accounts for additional savings resulting from American's
proposals to roll back a variety of job protections contained in
the 2003-2008 CBA. Regarding cutbacks in particular contract
terms, the record shows that American's demands go far beyond the
assumptions in the Company's own Business Plan as well as the job
protections under which other airlines operate, he argues.
On the contrary, the agreement concluded between the APA and US
Airways in April 2012 calls for $240 million in annual reductions
to pilot labor costs, or $130 million less than American has
demanded, Mr. James discloses. The concessions sought and
obtained by US Airways fall within the $230 to $260 million range
that American previously calculated as its competitive labor cost
gap for pilots and come fairly close to the $270 million in
annual savings that the APA offered to American in the Section
1113 negotiations, he notes.
Based on the record, American resumed exploring strategic
alternatives to its standalone Business Plan, including
consolidation, at least ten days before the hearing in this case,
says Mr. James. The record also demonstrates that US Airways has
a genuine interest in merging with American based on modified,
rather than rejected, labor agreements, and that American
believes it must consider consolidation prior to exiting
bankruptcy, he adds.
"In these circumstances, the synergies that could be generated
from a merger between American and US Airways, although currently
unknown, are not wholly speculative," Mr. James states.
Consequently, American has failed to carry its burden to
demonstrate that the balance of equities "clearly favors"
rejection of the 2003-2008 CBA, where a merger based on
consensual modified labor agreements could benefit all
stakeholders more than rejection of union contracts based on an
uncertain standalone Business Plan, he maintains.
* * *
The union announced on its Web site that American has made a
final contract offer and will decide whether it will send the
proposal to members for a vote, Mary Schlangenstein of Bloomberg
News reported. In the final offer, American made "clear
improvements" from its previous position, according to the union,
the report noted. APA and American renewed their talks on
June 13, but the parties failed to reach an agreement on
cutbacks, the report added.
B. APFA
American's proposal was not formulated using market-based
analysis and would place the Company's Flight Attendants costs
30% below those of its competitors, counsel to APFA, Robert S.
Clayman, Esq., at Guerrieri, Clayman, Bartos & Parcelli, P.C., in
Washington, D.C., contends. He stresses that the Company's
Section 1113 proposal would place its Flight Attendant costs $176
million below other network carriers in the contract's first
year. This cost advantage over competitors would grow to $347
million by 2015, he points out.
In contrast, APFA and US Airways have arrived at a term sheet
outlining terms of employment for American Flight Attendants in
the event of a merger. This term sheet provides for $153 million
in cost savings and is fundamentally superior to what the Company
seeks to impose by way of its Section 1113 proposal and motion.
Accordingly, the APFA had good cause to reject the Company's six-
year proposal because the process of evaluating merger
alternatives is ongoing and modification of the union contracts
is not a necessary predicate for that process, he insists.
"Expert testimony at trial established that the stand-alone plan
is not likely to succeed and that a merger is inevitable," the
APFA says. "In light of the weaknesses in the business plan and
the prospect of a merger which would likely involve fewer
concessions, it would be imprudent to agree to American's current
proposal."
* * *
The Debtors filed with the Court a revised proposed findings of
fact and conclusions of law, incorporating revisions sought by
the Pension Benefit Guaranty Corporation, in light of the
parties' May 4, 2012 stipulation. American agreed to add these
provisions:
(a) Freezing pension plans cuts off participant accruals and
accordingly generally reduces contributions.
(b) The unions have presented no evidence to show that freezing
the plans would not reduce minimum required contributions.
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.
AMR'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: Bondholders Asked to Study Stand-Alone Plan
--------------------------------------------------------------
AMR Corp. Chief Executive Officer Tom Horton wants an ad hoc group
of bondholders to consider a stand-alone plan before any merger
proposal for American Airlines, Inc., according to two people
familiar with the matter, Jeffrey McCracken and Mary
Schlangenstein of Bloomberg News reported.
The bondholder group, which holds about $700 million in AMR debt,
supports the sequence, said the people who declined to be named
because the meeting was private, Bloomberg relayed. The people
added that Mr. Horton expressed frustration with attention being
given to US Airways Group Inc.'s merger bid for the bankrupt
carrier.
According to Bloomberg, the process discussed at the session on
June 13 is the one being followed in AMR's bankruptcy, with the
company agreeing to consider alternative options after detailing
its own strategy to stay independent.
The session marked Mr. Horton's first meeting with the bondholders
who formed two groups in order to reap the highest benefit in any
AMR restructuring option, Bloomberg said. In his presentation to
the bondholders, Mr. Horton cited evidence to show that American's
stand-alone plan is working, the people disclosed.
The ad hoc group of bondholders organized outside AMR's bankruptcy
case and is not obliged to follow the same steps, the report
noted. The first group includes hedge fund Appaloosa Management
LP, and the other group includes Oppenheimer Funds Inc., the
largest holder of AMR's municipal debt.
"We're very focused on restructuring independently," Mr. Horton
said at a briefing in Beijing days before the bondholder meeting,
Bloomberg relayed. The CEO disclosed that the company is in the
midst of restructuring labor contracts, which he considers to be
the most challenging part of the process, the report noted.
This would take 13 months and most likely to cause American to
miss its target to emerge from bankruptcy by year-end, Mr. Horton
said, Bloomberg relayed. Mr. Horton recognized that restructuring
the labor contracts is a very aggressive objective, but an
achievable one at that, the report added.
American and the Allied Pilots Association resumed talks on June
13, but failed to reach agreement on concessions sought by the
carrier, according to a recent Bloomberg report. The union is
reviewing whether to send American's final contract offer to
members for a vote.
Meanwhile, American and two groups represented by the Transport
Workers Union were scheduled to renew talks from June 11 to 12.
Five other groups represented by the TWU accepted American's
proposals, which await court approval.
US Airways: We're Making Great Progress on Merger
US Airways CEO Doug Parker said his company is making "great
progress" towards a merger with American, Bloomberg reported.
The CEO also cited the "tremendous support" its merger bid
received from bondholders and analysts, the report noted.
Mr. Parker commented that restructuring in bankruptcy will not be
enough to fix American's weaknesses, according to the report.
Bloomberg noted that American's market share has fallen to No. 4
from third in the western U.S. to fourth from list in the
country's midsection and to fifth from third in the East.
"This is a structural weakness the bankruptcy cannot fix," Mr.
Parker was quoted as saying at US Airways' recent annual
shareholders meeting. He believes that a combination of US
Airways and American would be first in market share in the East
and midsection and third in the West, Bloomberg reported. "Put
them together and the result is a network that can compete with
anyone," according to the CEO.
American insisted that it is doing well in its focus to
restructure alone. "American's restructuring strategy is already
showing progress, with an industry-leading unit revenue
performance, as well as operational and customer service that are
the best they've seen in many years," said Andy Backover,
spokesperson for American, in an e-mailed statement to Bloomberg.
"All of this progress supports our confidence in the strength of
our plan for success."
After reaching tentative contracts with American's largest
unions, whose leaders attended the annual meeting, US Airways is
on to winning support among AMR's unsecured creditors, Bloomberg
related. Nevertheless, US Airways will have to wait until the
bankruptcy judge decides on American's bid to reject existing
union contracts before it can meet with AMR's unsecured creditors
and bondholders, according to a separate Associated Press report.
The Bankruptcy Court is expected to issue its decision by June 22.
To remove uncertainty in the merger picture, US Airways is hoping
to secure antitrust approval to bolster its bid for American,
according to a separate report by Soyoung Kim and Nick Brown of
Reuters. US Airways is hoping to file papers with the federal
antitrust regulators as early as July, said people with knowledge
of the matter, the report disclosed.
The exact timing of the filing will depend on the bankruptcy
court's issuance of the labor contracts ruling, Reuters said.
Reuters sources said US Airways is hoping to make the antitrust
application with the consent of AMR and its creditors. The
timeframe could slip beyond July, the report noted.
Moreover, US Airways is hoping to conduct due-diligence over the
next few months so that it can present a definitive proposal to
AMR's Official Committee of Unsecured Creditors, Reuters added.
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.
AMR'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: Blocks PSAs' Union-Representation Election
-------------------------------------------------------------
Judge Sean Lane entered a formal order denying the motion of the
Ad Hoc Committee of Passenger Service Agents to restrain AMR Corp.
and its affiliates from making unilateral changes in the terms and
conditions of employment of the PSAs, for reasons stated on the
record of the hearing on May 16, 2012.
In recent developments, American won a ruling temporarily
blocking a union-representation election among passenger-service
agents, set to begin this week, The Associated Press reported.
The Hon. Terry R. Means of the U.S. District Court for the
Northern District of Texas entered the temporary restraining
order, finding that American was likely to win its lawsuit to
block the election on the merits, the report said. The federal
judge also ruled that American could suffer permanent damage if
an election were held before the union got signed cards from 50
percent of eligible workers, according to the report.
The Communications Workers of America seeks to represent 10,000
agents who take reservations and work at airports at American,
the report noted. American opposed the union's request because
the union did not get enough workers to sign cards calling for a
union-representation vote per a law enacted in February,
according to the report.
The CWA insisted that it based its request for an election under
old rules that required 35% support, the report related.
Congress recently raised the minimum support to 50% in an
aviation bill that was enacted on Feb. 14, the report disclosed.
The Nation Mediation Board sided with the union and decided to go
ahead with an election, running from June 21, 2012 to August 2,
2012, the report said. American filed the lawsuit against the
mediation board to block the election, the report noted.
The federal judge scheduled a hearing in the case for June 21,
the report added.
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.
AMR'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: Has Settlement With HP Enterprise
----------------------------------------------------
AMR Corp. and its affiliates seek the Bankruptcy Court's
permission to enter into a settlement agreement with HP Enterprise
Services, LLC.
In 2008, the Debtors and HP are parties to a Fifth Amended and
Restated Information Technology Services Agreement, whereby HP
provides the Debtors with critical passenger processing services,
including availability, reservations, ticketing, and airport
processing and the software for such services is provided and
maintained by certain affiliates of Sabre Inc. In 2010, the
Debtors and HP entered into a prepetition Realtime Passenger
Services System Agreement, to develop and migrate to a new
Passenger Service System, including the software and hardware
components.
The Parties have worked together to develop the new Passenger
Service System under the PSS Agreement. The Parties have been
unable to reach agreement on several key issues affecting the
project's direction and it became clear that an orderly
termination of the PSS Agreement was in the best interests of
both Parties.
Accordingly, the Parties have entered into an agreement providing
for the termination of the PSS Agreement. Under the agreement,
HP will have an allowed prepetition unsecured claim against
American Airlines, Inc., in the amount of $7,651,728 for goods
and services provided before the Petition Date, under the PSS
Agreement.
In conjunction with the Termination Agreement, the Parties
separately negotiated an amendment no. "54" to 5ITSA to move
certain PSS-related work back to 5ITSA to assure that the
Debtors' Passenger Service System will continue to run smoothly.
Amendment No. 54 further reduces certain costs and expenses
relating to the operation of the existing Passenger Service
System.
A full-text copy of the Termination Agreement, together with
Amendment No. 545, is available for free at:
http://bankrupt.com/misc/AmAir_HPEntSettlement.pdf
The Settlement comprehensively resolves an extremely complex
relationship with respect to the building of a critical operating
system and provides the Debtors with the necessary flexibility to
pursue other alternatives while assuring the ongoing uninterrupted
functioning of their existing Passenger Service System, says
Stephen Karotkin, Esq., at Weil, Gotshal & Manges LLP, in New
York.
The Court will consider the Debtors' request on June 28, 2012.
Objections are due no later than June 21.
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.
AMR'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: Asks for Extension of Lease Decision Deadline
----------------------------------------------------------------
AMR Corp. and its affiliates ask the Bankruptcy Court to approve
consensual extensions of the deadline within which they may assume
or reject unexpired leases of nonresidential real property,
without prejudice to the Debtors' right to seek further extensions
under Section 365(d)(4) of the Bankruptcy Code.
A list of the Leases subject to the consensual extensions is
available for free at:
http://bankrupt.com/misc/AmAir_Sec365ConsExtnLeases.pdf
Section 365(d)(4)(A) of the Bankruptcy Code provides for an
initial period of 120 days after the Petition Date during which a
debtor may assume or reject unexpired leases of non-residential
real property under which the debtor is the lessee. The Debtors'
period to assume or reject the Unexpired Leases will expire on
June 26, 2012.
Rather than prematurely assume certain Leases or risk inadvertent
rejection of the Leases, the Debtors have contacted the Lease
counterparties via letter correspondence, seeking an extension of
the deadline for the Leases. The Debtors receive consents from
the Lease counterparties to further extend the deadline for the
applicable leases.
The forms of consent comply with the provisions of the Bankruptcy
Code and enable the Debtors to efficiently obtain an extension of
time under Section 365(d)(4)(B)(ii) without the necessity of
litigating over whether such Leases constitute unexpired leases
of nonresidential real property, the determination of the cure
amounts, or any other issues, the Debtors insist.
The Debtors are committed to remaining current with respect to
all undisputed postpetition obligations under the Leases in
compliance with Section 365(d)(3) of the Bankruptcy Code. The
Debtors will continue to evaluate the Leases on an ongoing basis
as expeditiously as practicable and will file appropriate motions
as soon as informed decisions can be made.
The Court will consider the Debtors' request on June 20, 2012.
Objections are due no later than June 18.
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.
AMR'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 MEDICAL: Spars With U.S., Burns Cash
---------------------------------------------
Patrick Fitzgerald at DBR Small Cap reports that American Medical
Technologies says it continues to burn cash at an "unacceptable
rate" despite having struck a deal with the U.S. government that
was supposed to provide the company with some breathing room to
resolve a Medicare dispute that pushed it into bankruptcy.
About American Medical
Gordian Medical, Inc., dba American Medical Technologies, filed a
Chapter 11 petition (Bankr. C.D. Calif. Case No. 12-12339) in
Santa Ana, California, on Feb. 24, 2012, after Medicare refunds
were halted. The Debtor estimated assets and debts of up to
$50 million. It has $4.3 million in cash and $31.1 million in
receivables due from Medicare.
Irvine, California-based Gordian Medical provides supplies and
services to treat serious wounds. The company has active
relationships with and serves patients in more than 4,000 nursing
facilities in 49 states with the heaviest concentration of the
nursing homes being in the south and southeast sections of the
United States.
Judge Mark S. Wallace oversees the case. Pachulski Stang Ziehl &
Jones LLP serves as the Debtor's counsel. GlassRatner Advisory &
Capital Group LLC serves as the Debtor's financial advisor.
The U.S. Trustee appointed five members to the Official Committee
of Unsecured Creditors. The Committee is represented by Landau
Gottfried & Berger LLP.
AMERICAN WEST: Field Law Approved as FCR James Moore's Counsel
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Nevada authorized
James L. Moore, as future claims representative in the Chapter 11
case of American West Development, Inc., to employ the law
firm of Field Law Ltd. as his counsel.
As reported in the Troubled Company Reporter on May 24, 2012,
Field Law is expected to, among other things:
a. investigate and evaluate the number and extent of potential
claims that could be asserted against Debtor by the class of
individuals that comprises the Future Construction Defect
Claimants;
b. employ experts or other professional persons as may be
required; and
c. negotiate on behalf of Future Construction Defect Claimants
the terms of any pending or proposed plan of reorganization.
Field Law's billing rates for attorneys from $375 per hour to $450
per hour. However, it is not anticipated that any professionals
having day-to-day responsibility for the matter will charge over
the rate of $375 per hour. The paralegals' hourly rates range
from approximately $150 to $175 per hour. The Field Law
professional expected to be responsible for providing services to
the Future Claims Representative is Mitchell Stipp, of counsel
($375/hour).
To the best of the Future Claims Representative's knowledge, the
firm is a "disinterested person" as that term is defined Section
101(14) of the Bankruptcy Code.
About American West
American West Development, Inc. -- fdba Castlebay 1, Inc., et al.
-- is a homebuilder in Las Vegas, Nevada, founded on July 31,
1984. Initially, AWDI was known as CKC Corporation, but later
changed its name.
AWDI filed for Chapter 11 bankruptcy protection (Bankr. D. Nev.
Case No. 12-12349) on March 1, 2012. Judge Mike K. Nakagawa
presides over the case. Brett A. Axelrod, Esq., and Micaela
Rustia Moore, Esq., at Fox Rothschild LLP, serve as AWDI's
bankruptcy counsel. Nathan A. Schultz, P.C., is AWDI's conflicts
counsel. AWDI hired Garden City Group as its claims and notice
agent. American West disclosed $55.39 million in assets and
$208.5 million in liabilities as of the Chapter 11 filing.
AMIN'S OIL: Case Summary & 15 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Amin's Oil Inc.
2603 S Normandie Ave.
Los Angeles, CA 90007
Bankruptcy Case No.: 12-30886
Chapter 11 Petition Date: June 15, 2012
Court: United States Bankruptcy Court
Central District of California (Los Angeles)
Judge: Julia W. Brand
Debtor's Counsel: Amy Ghosh, Esq.
LAW OFFICES OF AMY GHOSH
3255 Wilshire Blvd. 1530
Los Angeles, CA 90010
Tel: (213) 365-2370
Fax: (213) 389-6931
Estimated Assets: $50,001 to $100,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 15 largest unsecured creditors
filed together with the petition is available for free at
http://bankrupt.com/misc/cacb12-30886.pdf
The petition was signed by Amirul Islam, president and CEO.
AOP INTERNATIONAL: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: AOP International Corp.
dba AOP Corporation
fdba AOP Supply Corporation
18000 Groschke Rd., Hangar G-12
Houston, TX 77084
Bankruptcy Case No.: 12-34566
Chapter 11 Petition Date: June 15, 2012
Court: United States Bankruptcy Court
Southern District of Texas (Houston)
Judge: Karen K. Brown
Debtor's Counsel: Ronald J. Sommers, Esq.
NATHAN SOMMERS JACOBS
2800 Post Oak Blvd.
61st Floor
Houston, TX 77056-6102
Tel: (713) 892-4801
Fax: (713) 892-4800
E-mail: efilers@nathansommers.com
Scheduled Assets: $2,974,517
Scheduled Liabilities: $3,572,321
A copy of the Company's list of its 20 largest unsecured creditors
filed together with the petition is available for free at
http://bankrupt.com/misc/txsb12-34566.pdf
The petition was signed by Glemon Silva, president.
ATRINSIC INC: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Atrinsic, Inc.
469 Seventh Avenue, 10th Floor
New York, NY 10018
Bankruptcy Case No.: 12-12553
Chapter 11 Petition Date: June 15, 2012
Court: United States Bankruptcy Court
Southern District of New York (Manhattan)
Judge: James M. Peck
Debtor's Counsel: Jonathan S. Pasternak, Esq.
RATTET PASTERNAK, LLP
550 Mamaroneck Avenue, Suite 510
Harrison, NY 10528
Tel: (914) 381-7400
Fax: (914) 381-7406
E-mail: jsp@rattetlaw.com
Scheduled Assets: $5,342,665
Scheduled Liabilities: $13,678,118
A copy of the Company's list of its 20 largest unsecured creditors
filed together with the petition is available for free at
http://bankrupt.com/misc/nysb12-12553.pdf
The petition was signed by Sebastian Giordano, chief restructuring
officer.
BERNARD L. MADOFF: Judge OKs Settlement for Hispanic Investors
--------------------------------------------------------------
Jonathan Randles at Bankruptcy Law360 reports that a New York
federal judge has signed off on a $7.8 million settlement on
behalf of 278 Hispanic investors who lost millions of dollars by
investing in bankrupt Bernie Madoff feeder fund Fairfield Sentry
Limited Fund through Miami-based brokerage firm EFG Capital
International Corp., attorneys said Friday.
The settlement marks the first time a group that invested in
Fairfield Sentry and lost money in the Madoff scandal has received
compensation through litigation, Lawrence Kellogg, an attorney
representing the investors from Levine Kellogg Lehman Schneider &
Grossman, said.
About Bernard L. Madoff
Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff
orchestrated the largest Ponzi scheme in history, with losses
topping US$50 billion. On Dec. 15, 2008, the Honorable Louis A.
Stanton of the U.S. District Court for the Southern District of
New York granted the application of the Securities Investor
Protection Corporation for a decree adjudicating that the
customers of BLMIS are in need of the protection afforded by the
Securities Investor Protection Act of 1970. The District Court's
Protective Order (i) appointed Irving H. Picard, Esq., as trustee
for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP
as his counsel, and (iii) removed the SIPA Liquidation proceeding
to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789)
(Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims
agent.
On April 13, 2009, former BLMIS clients filed an involuntary
Chapter 7 bankruptcy petition against Bernard Madoff (Bankr.
S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The
petitioning creditors -- Blumenthal & Associates Florida General
Partnership, Martin Rappaport Charitable Remainder Unitrust,
Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert
US$64 million in claims against Mr. Madoff based on the balances
contained in the last statements they got from BLMIS.
On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff
Securities International Limited in London under bankruptcy
protection pursuant to Chapter 15 of the U.S. Bankruptcy Code
(Bankr. S.D. Fla. 09-16751).
The Chapter 15 case was later transferred to Manhattan. In June
2009, Judge Lifland approved the consolidation of the Madoff SIPA
proceedings and the bankruptcy case.
Judge Denny Chin of the U.S. District Court for the Southern
District of New York on June 29, 2009, sentenced Mr. Madoff to
150 years of life imprisonment for defrauding investors in United
States v. Madoff, No. 09-CR-213 (S.D.N.Y.)
The SIPA Trustee has said that as of March 31, 2012, through
prepetition litigation and other settlements, he has successfully
recovered, or reached agreements to recover, more than $9 billion
-- over 50% of the principal lost in the Ponzi scheme by those who
filed claims -- for the benefit of all customers of BLMIS.
The liquidation has so far has cost the Securities Investor
Protection Corp. $1.3 billion, including $791 million to pay a
portion of customers' claims.
Mr. Picard has so far made only one distribution in October of
$325 million for 1,232 customer accounts. Uncertainty created by
the appeals has limited Mr. Picard's ability to distribute
recovered funds. Outstanding appeals include the $5 billion
Picower settlement and the $1.025 billion settlement.
BERNARD L. MADOFF: Trustee Facing Dismissal Under Swap Defense
--------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that an affiliate of ABN Amro Bank NV laid the groundwork
for U.S. District Judge Jed Rakoff to decide an arcane question
that could give some financial institutions immunity from suits by
the trustee liquidating Bernard L. Madoff Investment Securities
Inc.
Mr. Rochelle recounts that the trustee filed suit, contending the
bank's affiliate in Ireland was the subsequent recipient of $267
million initially paid out by the Madoff firm to a feeder fund.
The bank prevailed on Judge Rakoff to remove the suit from
bankruptcy court to decide threshold questions that could result
in dismissal of the suit. The bank filed its papers seeking
dismissal on June 13.
According to the report, the bank explains how it had swap
transactions with the feeder fund and that the money traceable to
Mr. Madoff was paid pursuant to the swap. The bank contends
Section 546(g) of the Bankruptcy Code requires dismissal because
it precludes a trustee from suing to recover a payment received in
a swap. Although the trustee will file his opposition papers
later, the trustee has already gone on record with technical
arguments explaining why the bank isn't automatically entitled to
dismissal on account of the swap.
Mr. Rochelle discloses that Irving Picard, the Madoff trustee,
argues that the bank is being sued as a subsequent recipient of
fraudulently transferred funds and that the so-called safe harbor
for swaps only protects an initial recipient.
Judge Rakoff, the report relates, has chopped away at Mr. Picard's
suits by ruling that the trustee may recover fictitious profits
paid out within two years of bankruptcy rather than six. He also
erected a high barrier to suits for recovery of principal. Judge
Rakoff ruled in Mr. Picard's favor by saying that U.S. customers
sued for recovery of fictitious profits have few if any defenses
to fend off a fraudulent transfer judgment for payments within two
years of bankruptcy.
The case involving ABN Amro and swaps is part of Securities
Investor Protection Corp. v. Bernard L. Madoff Investment
Securities LLC, 12-mc-00115, U.S. District Court, Southern
District New York (Manhattan).
About Bernard L. Madoff
Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff
orchestrated the largest Ponzi scheme in history, with losses
topping US$50 billion. On Dec. 15, 2008, the Honorable Louis A.
Stanton of the U.S. District Court for the Southern District of
New York granted the application of the Securities Investor
Protection Corporation for a decree adjudicating that the
customers of BLMIS are in need of the protection afforded by the
Securities Investor Protection Act of 1970. The District Court's
Protective Order (i) appointed Irving H. Picard, Esq., as trustee
for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP
as his counsel, and (iii) removed the SIPA Liquidation proceeding
to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789)
(Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims
agent.
On April 13, 2009, former BLMIS clients filed an involuntary
Chapter 7 bankruptcy petition against Bernard Madoff (Bankr.
S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The
petitioning creditors -- Blumenthal & Associates Florida General
Partnership, Martin Rappaport Charitable Remainder Unitrust,
Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert
US$64 million in claims against Mr. Madoff based on the balances
contained in the last statements they got from BLMIS.
On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff
Securities International Limited in London under bankruptcy
protection pursuant to Chapter 15 of the U.S. Bankruptcy Code
(Bankr. S.D. Fla. 09-16751).
The Chapter 15 case was later transferred to Manhattan. In June
2009, Judge Lifland approved the consolidation of the Madoff SIPA
proceedings and the bankruptcy case.
Judge Denny Chin of the U.S. District Court for the Southern
District of New York on June 29, 2009, sentenced Mr. Madoff to
150 years of life imprisonment for defrauding investors in United
States v. Madoff, No. 09-CR-213 (S.D.N.Y.)
The SIPA Trustee has said that as of March 31, 2012, through
prepetition litigation and other settlements, he has successfully
recovered, or reached agreements to recover, more than $9 billion
-- over 50% of the principal lost in the Ponzi scheme by those who
filed claims -- for the benefit of all customers of BLMIS.
The liquidation has so far has cost the Securities Investor
Protection Corp. $1.3 billion, including $791 million to pay a
portion of customers' claims.
Mr. Picard has so far made only one distribution in October of
$325 million for 1,232 customer accounts. Uncertainty created by
the appeals has limited Mr. Picard's ability to distribute
recovered funds. Outstanding appeals include the $5 billion
Picower settlement and the $1.025 billion settlement.
BHFS I LLC: Case Summary & 7 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: BHFS I, LLC
15601 Dallas Parkway, Suite 600
Addison, TX 75001
Bankruptcy Case No.: 12-41581
Chapter 11 Petition Date: June 13, 2012
Court: U.S. Bankruptcy Court
Eastern District of Texas (Sherman)
Judge: Brenda T. Rhoades
About the Debtors: BHFS I and its debtor-affiliates own and
operate substantial office, retail, and
residential rental space at the highly regarded
project known as "Frisco Square," in Frisco,
Texas. The project has 103,120 square feet of
rentable office space in three buildings,
110,395 square feet of retail space in six
buildings, including a 12-screen, 41,464
square-foot Cinemark theater, and 114 high-end
multifamily rental units in two buildings, all
built between 2000 and 2010. Occupancy rates
are more than 85% for the office and retail
space and almost 95% for multifamily space.
Debtors' Counsel: Davor Rukavina, Esq.
MUNSCH HARDT KOPF & HARR, P.C.
3800 Lincoln Plaza, 500 North Akard Street
Dallas, TX 75201-6659
Tel: (214) 855-7587
Fax: (214) 978-5359
E-mail: drukavina@munsch.com
- and ?
Jonathan Lindley Howell, Esq.
MUNSCH HARDT KOPF & HARR, P.C.
3800 Lincoln Plaza, 500 North Akard Street
Dallas, TX 75201
Tel: (214) 855-7501
Fax: (214) 855-7584
E-mail: jhowell@munsch.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The petition was signed by Michael J. O'Hanlon, president.
Affiliates that simultaneously filed Chapter 11 petitions:
Debtor Case No.
------ --------
BHFS II, LLC 12-41582
Assets: $10,000,001 to $50,000,000
Debts: $10,000,001 to $50,000,000
BHFS III, LLC 12-41583
BHFS IV, LLC 12-41584
BHFS Theater, LLC 12-41585
Behringer Harvard Frisco Square, LP 12-41586
A. BHFS I, LLC's List of Its Seven Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Frisco ISD Ad Valorem Taxes $200,000
P.O. Box 547
Frisco, TX 75034
Kenneth L. Maun, Tax Assessor Ad Valorem Taxes $115,000
1800 N. Graves Street, Suite 170
McKinney, TX 75070-8046
Frisco Square Property Owners Semi-Annual MMD $67,600
Association Bond Payments
16250 Knoll Trail Drive, Suite 102
Dallas, TX 75248
FPMC Frisco Realty Partners LP 2011 Property Taxes $12,513
Over $150K
Frisco Square Property Owners Expense Reimbursement $11,700
Association
CoServ Utilities-Electricity $2,586
Services
Aki Land Service, Inc. Trade Debt $750
B. BHFS II, LLC's List of Its 13 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Frisco ISD Property Taxes $88,000
P. O. Box 547
Frisco, TX 75034
Kenneth L. Maun, Tax Collector Property Taxes $49,000
1800 N. Graves Street, Suite 170
McKinney, TX 75070-8046
Frisco Square Property Owners Semi-Annual MMD $42,000
Association Bond Payments
16250 Knoll Trail Drive, Suite 102
Dallas, TX 75248
CoServ Utilities $14,197
Electricity Services
Houk Enterprises, LLC Tenant Espiritu $6,696
Willis of Tennessee, Inc. Insurance $5,833
Woodlander Environments, Inc. Trade Debt $2,758
City of Frisco Utilities - Water $950
Services
Frisco Square Property Expense Reimbursement $360
Fairview Enterprises LLC Trade Debt $319
AT&T Utilities ? Telephone $289
Services
Sitestuff, Inc. Trade Debt $103
Grande Communications DSL Services $74
BIG THOMPSON: Case Summary & 7 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Big Thompson LLC
dba Econolodge
1650 Big Thompson Avenue
Estes Park, CO 80517-8938
Bankruptcy Case No.: 12-22455
Chapter 11 Petition Date: June 13, 2012
Court: U.S. Bankruptcy Court
District of Colorado (Denver)
Judge: A. Bruce Campbell
Debtor's Counsel: Gregg H. Coffman, Esq.
GREGG H. COFFMAN, PC
501 St. Vrain Lane, Suite 200
Estes Park, CO 80517
Tel: (970) 586-5566
E-mail: gregg@esteslawyer.net
Scheduled Assets: $2,076,805
Scheduled Liabilities: $2,816,230
A copy of the Company's list of its seven largest unsecured
creditors filed with the petition is available for free at:
http://bankrupt.com/misc/cob12-22455.pdf
The petition was signed by In S. John, president.
BLUE RAVEN: Leading Ridge to Buy Business for $1.4 Million
----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Blue Raven Technology Inc. filed papers June 15 to
sell the business for $1.4 million to private-equity investor
Leading Ridge Capital Partners LLC from Rockville, Maryland. The
U.S. Bankruptcy Court in Boston scheduled a June 26 hearing for
approval of a breakup fee to be paid to Leading Ridge if another
purchaser ends up buying the business. Although competing offers
can be submitted, Blue Raven intends to sell the business without
a formal auction.
About Blue Raven
Blue Raven Technology, Inc., filed a Chapter 11 petition (Bankr.
D. Mass. Case No. 12-14693) on May 30, 2012. Blue Raven is a
provider of parts and repair services for consumer electronics and
computers. The Company had $17.7 million of revenue in 2011, an
18% decline from the year before. The company blamed its problems
on the bankruptcies of electronics retailers that had been major
customers.
David B. Madoff, Esq., at Madoff & Khoury LLP, in Foxboro, serves
as counsel. The Debtor disclosed $2.143 million in assets and
$8.284 million in liabilities.
BONDS.COM GROUP: GFINet Discloses 60.8% Equity Stake
----------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, GFINet Inc. and GFI Group Inc. disclosed
that, as of June 8, 2012, they beneficially own 162,130,097 shares
of common stock of Bonds.com Group, Inc., representing 60.8% of
the shares outstanding. The 162,130,097 represents the number of
shares of common stock that would be beneficially owned upon full
conversion of the shares of Series E Preferred Stock and Series E-
2 Preferred Stock (in each case, assuming a conversion as of
June 8, 2012), and the exercise of all common stock warrants held
as of June 8, 2012.
GFINet previously reported beneficial ownership of 125,242,858
common shares or a 54.5% equity stake as of Dec. 5, 2011.
A copy of the amended filing is available for free at:
http://is.gd/wWNgbo
About Bonds.com Group
Based in Boca Raton, Florida, Bonds.com Group, Inc. (OTC BB: BDCG)
-- http://www.bonds.com/-- through its subsidiary Bonds.com,
Inc., serves institutional fixed income investors by providing a
comprehensive zero subscription fee online trading platform. The
Company designed the BondStation and BondStationPro platforms to
provide liquidity and competitive pricing to the fragmented Over-
The-Counter Fixed Income marketplace.
The Company differentiates itself by offering through Bonds.com,
Inc. an inventory of more than 35,000 fixed income securities from
more than 175 competing sources. Asset classes currently offered
on BondStation and BondStationPro, the Company's fixed income
trading platforms, include municipal bonds, corporate bonds,
agency bonds, certificates of deposit, emerging market debt,
structured products and U.S. Treasuries.
The Company reported a net loss of $14.45 million in 2011,
compared with a net loss of $12.51 million in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $9.62 million
in total assets, $14.85 million in total liabilities and a $5.23
million total stockholders' deficit.
Daszkal Bolton LLP, in Boca Raton, Florida, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2011, citing recurring losses and
negative cash flows from operations that raise substantial doubt
about the Company's ability to continue as a going co
BONDS.COM GROUP: Oak Investment Discloses 68.7% Equity Stake
------------------------------------------------------------
In an amended Schedule 13D filing with U.S. Securities and
Exchange Commission, Oak Investment Partners XII, Limited
Partnership, and its affiliates disclosed that, as of June 8,
2012, they beneficially own 229,337,631 shares of common stock of
Bonds.com Group, Inc., representing 68.7% of the shares
outstanding. The 229,337,631 represents the number of shares of
common stock that would be beneficially owned upon full conversion
of the shares of Series C Preferred Stock, Series E Preferred
Stock and Series E-2 Preferred Stock (all assuming conversion as
of June 8, 2012), and the exercise of all warrants for common
stock.
Oak Investment previously reported beneficial ownership of
191,518,572 common shares or a 64.7% equity stake as of Dec. 5,
2011.
A copy of the amended filing is available for free at:
http://is.gd/FmVCOz
About Bonds.com Group
Based in Boca Raton, Florida, Bonds.com Group, Inc. (OTC BB: BDCG)
-- http://www.bonds.com/-- through its subsidiary Bonds.com,
Inc., serves institutional fixed income investors by providing a
comprehensive zero subscription fee online trading platform. The
Company designed the BondStation and BondStationPro platforms to
provide liquidity and competitive pricing to the fragmented Over-
The-Counter Fixed Income marketplace.
The Company differentiates itself by offering through Bonds.com,
Inc. an inventory of more than 35,000 fixed income securities from
more than 175 competing sources. Asset classes currently offered
on BondStation and BondStationPro, the Company's fixed income
trading platforms, include municipal bonds, corporate bonds,
agency bonds, certificates of deposit, emerging market debt,
structured products and U.S. Treasuries.
The Company reported a net loss of $14.45 million in 2011,
compared with a net loss of $12.51 million in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $9.62 million
in total assets, $14.85 million in total liabilities and a $5.23
million total stockholders' deficit.
Daszkal Bolton LLP, in Boca Raton, Florida, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2011, citing recurring losses and
negative cash flows from operations that raise substantial doubt
about the Company's ability to continue as a going concern.
BONDS.COM GROUP: Michel Daher Discloses 73.3% Equity Stake
----------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Michel Daher and his affiliates disclosed
that, as of June 8, 2012, they beneficially own 285,714,286 shares
of common stock of Bonds.com Group, Inc., representing 73.2% of
the shares outstanding. The number of shares includes 142,857,143
shares of Common Stock issuable upon conversion of shares of
Series E-2 Convertible Preferred Stock and 142,857,143 shares of
Common Stock issuable upon exercise of warrants.
Mr. Daher previously reported beneficial ownership of 171,428,570
common shares or a 62.2% equity stake as of Dec. 5, 2011.
A copy of the amended filing is available for free at:
http://is.gd/vu4z3Z
About Bonds.com Group
Based in Boca Raton, Florida, Bonds.com Group, Inc. (OTC BB: BDCG)
-- http://www.bonds.com/-- through its subsidiary Bonds.com,
Inc., serves institutional fixed income investors by providing a
comprehensive zero subscription fee online trading platform. The
Company designed the BondStation and BondStationPro platforms to
provide liquidity and competitive pricing to the fragmented Over-
The-Counter Fixed Income marketplace.
The Company differentiates itself by offering through Bonds.com,
Inc. an inventory of more than 35,000 fixed income securities from
more than 175 competing sources. Asset classes currently offered
on BondStation and BondStationPro, the Company's fixed income
trading platforms, include municipal bonds, corporate bonds,
agency bonds, certificates of deposit, emerging market debt,
structured products and U.S. Treasuries.
The Company reported a net loss of $14.45 million in 2011,
compared with a net loss of $12.51 million in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $9.62 million
in total assets, $14.85 million in total liabilities and a $5.23
million total stockholders' deficit.
Daszkal Bolton LLP, in Boca Raton, Florida, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2011, citing recurring losses and
negative cash flows from operations that raise substantial doubt
about the Company's ability to continue as a going concern.
BOWLES SUB: Wants Access to Wells Fargo Cash Until Nov. 30
----------------------------------------------------------
Bowles Sub Parcel A, LLC, and Fenton Sub Parcel A, LLC, ask the
U.S. Bankruptcy Court District of Minnesota for authorization to
use the cash collateral consisting of rents existing as of the
Filing Date, and future rents in which Wells Fargo Bank, N.A.,
claims an interest until Nov. 30, 2012.
Wells Fargo serves as trustee for the registered holder of J.P.
Morgan Chase Commercial Mortgage Securities Corp., Commercial
Mortgage Pass-Through Certificates, Series 2004-LN2.
The Debtors relate that the current unpaid balance of the First
Mortgage Debt is approximately $8,696,878.
The Debtors will use the cash collateral to pay expenses in
accordance with the cash flow projections and budget. A full-text
copy of the budget is available for free at:
http://bankrupt.com/misc/BOWLESSUB_cashcoll-budget.pdf
As adequate protection from any diminution in value of the
lender's collateral, the Debtors note that lender has a
continuing security interest in all postpetition rents pursuant to
Section 552 of the Bankruptcy Code.
As additional adequate protection, the lender has an equity
cushion in its collateral of approximately 30% as of the Filing
Date.
In a separate filing, Elizabeth Hulsebos of Dorsey & Whitney LLP,
notified the Court that she will be counsel for the Committee of
Unsecured Creditors of Debtor Steven B. Hoyt, chief manager.
She can be reached at:
Elizabeth Hulsebos, Esq.
Dorsey & Whitney LLP
50 South Sixth Street, Suite 1500
Minneapolis, MN 55402-1498
Tel: (612) 340-2600
Fax: (612) 340-2643
E-mail: hulsebos.elizabeth@dorsey.com
About StoneArch II/WCSE Entities
StoneArch II/WCSE Minneapolis Industrial LLC in 2007 acquired
various limited liability companies, which in turn owned 27
industrial multi-tenant properties located in Minneapolis/St. Paul
in Minnesota. The properties were divided into four separate
pools: A, B, C, and D.
Fenton Sub Parcel D LLC and Bowles Sub Parcel D LLC, which jointly
own the properties in pool D, sought Chapter 11 protection (Bankr.
D. Minn. Case Nos. 11-44430 and 11-44434) on June 29, 2011. A
Chapter 11 plan has been filed for the pool D debtors. The plan,
if approved, would allow the existing owners to maintain operation
of the properties.
Bowles Sub Parcel A, LLC, and five other entities, which jointly
own parcels A, B and C, filed for Chapter 11 protection (Bankr. D.
Minn. Case Nos. 12-42765, 12-42768, 12-42769, 12-42770, 12-42772,
and 12-42774) on May 8, 2012. Each of the May 8 Debtors estimated
$10 million to $50 million in assets. Bowles Sub A disclosed
$11,442,268 in assets and $9,716,342 in liabilities as of the
Chapter 11 filing.
The other May 8 debtors are Fenton Sub Parcel A, LLC, Bowles Sub
Parcel B, LLC, Fenton Sub Parcel B, LLC, Bowles Sub Parcel C, LLC,
and Fenton Sub Parcel C, LLC.
Judge Nancy C. Dreher oversees the May 8 Debtors' cases, taking
over from Judge Gregory F. Kishel.
The May 8 Debtors tapped Lapp Libra Thomson Stoebner & Pusch as
counsel. Steven B. Hoyt, as chief manager, signed the Chapter 11
petitions.
BUFFETS INC: Closes Springfield, Ill. Outlet
--------------------------------------------
The State Journal Register reports that Ryan's, the buffet
restaurant at 2730 N. Dirksen Parkway, Springfield, Ill., has gone
out of business. According to the report, a spokesman for Eagan,
Minn.-based Buffets Inc., the parent company, confirmed the
closure, but provided no further details.
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. In its schedules Buffets Inc.
disclosed $384,810,974 in assets and $353,498,404 in liabilities.
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.
In March 2012, Buffets Inc. received court approval for an
incentive bonus program that may pay as much as $2.3 million to
executives if cash flow targets are met. There was an April 30
hearing schedule on another program to pay bonuses for a
successful sale of the business that could cost $2.7 million.
In April 2012, Buffets Inc. filed an amended bankruptcy exit plan
that proposes to pay $4 million to a pool of unsecured creditors
who are owed more than $44 million. Unsecured creditors are
expected to recover about 9% of their claims.
CENTRAL FALLS: City Council Members' Bid to Oust Receiver Fails
---------------------------------------------------------------
American Bankruptcy Institute reports that Central Falls, R.I.,
city councilors failed at their latest attempt to take back
control of the struggling Providence suburb's finances.
About Central Falls
Central Falls is a city in Providence County, Rhode Island. The
population was 18,928 at the 2000 census. Central Falls is the
smallest and most densely populated city in Rhode Island.
Central Falls sought bankruptcy protection under Chapter 9 of the
U.S. Bankruptcy Code (Bankr. D. R.I. Case No. 11-13105) on Aug. 1,
2011. The Chapter 9 filing was made after former Rhode Island
Supreme Court Judge Robert Flanders, who serves as state-appointed
receiver for the city, was unable to negotiate significant
concessions from unions representing police officers, firefighters
and other city workers. The city grappled with an $80 million
unfunded pension and retiree health benefit liability that is
nearly quadruple its annual budget of $17 million. Judge Robert
Flanders succeeded the role from retired Superior Court Associate
Justice Mark A. Pfeiffer, who was appointed in July 2010. The
Central Falls receivership, the state's first, has left the mayor
and council without any power to govern.
Judge Frank Bailey presides over the Chapter 9 case. Theodore
Orson, Esq., at Orson and Brusini Ltd., serves as bankruptcy
counsel to the receiver.
The receiver is negotiating new contracts with unions representing
city workers. The receiver filed a proposed debt adjustment plan
for the city in September. It won't affect bondholders.
CIRCUS AND ELDORADO: U.S. Trustee Forms 3-Member Creditors Panel
----------------------------------------------------------------
August B. Landis, Acting U.S. Trustee for Region 17, appointed
three persons to serve in the Official Committee of Unsecured
Creditors in the Chapter 11 cases of Circus and Eldorado Joint
Venture, et al.
The Committee members are:
1. Associated Laundry Management, LLC
Attn: Greg Anderson
Associated Laundry Management
250 Burge Lane
Reno NV 89503
Tel: (775) 329-6433
Fax: (775) 329-6730
E-mail: gjaconsult@aol.com
2. International Game Technology
Attn: Gent K. Culver, credit manager
9295 Prototype Drive
Reno NV 89521
Tel: (775) 448-0130
Fax: (775) 448-0401
E-mail: gent.culver@igt.com
3. Shuffle Master Inc.
Attn: Darrell Horton, A/R and Revenue Manager
1106 Palms Airport Drive
Las Vegas NV 89119
Tel: (702) 270-5138
Fax: (888) 234-3881
E-mail: dhorton@shufflemaster.com
About Circus and Eldorado
Circus and Eldorado Joint Venture and Silver Legacy Capital Corp.
filed for Chapter 11 bankruptcy (Bankr. D. Nev. Case Nos. 12-51156
and 12-51157) on May 17, 2012.
Circus and Eldorado Joint Venture owns and operates the Silver
Legacy Resort Casino, a premier 19th century silver mining themed
hotel, casino and entertainment complex located in downtown Reno,
Nevada. The casino and entertainment areas at Silver Legacy are
connected by skyway corridors to the neighboring Eldorado Hotel &
Casino and the Circus Circus Hotel and Casino, each of which are
owned by affiliates of the Debtors. Together, the three
properties comprise the heart of the Reno market's prime gaming
area and room base.
Silver Legacy Capital Corp. is a wholly owned subsidiary of the
Joint Venture and was created and exists for the sole purpose of
serving as a co-issuer of the mortgage notes due 2012. SLCC has
no operations, assets or revenues.
Eldorado Hotel & Casino and Circus Circus Hotel and Casino are not
debtors in the Chapter 11 cases.
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.
As a result, an aggregate of $142,800,000 principal amount of
Notes were outstanding and accrued interest of $7,229,250 on the
Notes, as of March 1, 2012, is due and payable.
The Debtors have entered into a Restructuring Support Agreement
ith Capital Research and Management Company, a holder of a
ubstantial portion of the mortgage notes. A copy of the RSA
dated March 15, 2012, is available for free at http://is.gd/diDPh3
The RSA contemplates a proposed plan will be filed no later than
June 1, 2012. The plan will contain creditor treatments that
have already been negotiated with and agreed to by creditor
constituents. The Debtors will seek approval of the explanatory
disclosure statement within 45 days after the Petition Date and
obtain confirmation of the Plan 60 days later.
Judge Bruce T. Beesley presides over the case. Paul S. Aronzon,
Esq., and Thomas P. Kreller, Esq., at Milbank, Tweed, Hadley &
McCloy LLP; and Sallie B. Armstrong, Esq., at Downey Brand LLP,
serve as the Debtors' counsel. The Debtors' financial advisor is
FTI Consulting Inc. The claims agent is Kurtzman Carson
Consultants LLC.
The Bank of New York Mellon Trust Company, N.A., the trustee for
the Debtors' 10-1/8% Mortgage Notes due 2012, is represented by
Craig A. Barbarosh, Esq., and Karen B. Dine, Esq., at Pillsbury
Winthrop Shaw Pittman LLP.
Circus and Eldorado Joint Venture had assets of $264 million and
liabilities of $174 million as of March 31, 2012. The petitions
were signed by Stephanie D. Lepori, chief financial officer.
CHINA TEL GROUP: Unregistered Securities Sale Exceed 5% Threshold
-----------------------------------------------------------------
Since its most recent report filed on any of Forms 8-K, 10-K or
10-Q, VelaTel Global Communications, Inc., formerly known as China
Tel Group Inc. has made the sales of unregistered securities,
namely shares of the Company's Series A common stock. The Company
filed a Form 8-K because the aggregate number of Shares sold
exceeds five percent of the total number of Shares issued and
outstanding as of the Company's latest filed Report, on Form 10-Q
filed on May 21, 2012.
On June 13, 2012, the Company issued 60,612,408 shares and
60,612,408 warrants to Isaac Organization, Inc., in payment of a
promissory note in the amount of $500,000 due May 15, 2012. Each
warrant has an exercise price of $0.0085 and an exercise term of
three years.
In addition, the Company has issued 39,368,196 registered Shares
pursuant to a Form S-8 Registration Statement filed on June 1,
2012, which is incorporated by reference.
As of June 15, 2012, the Company has 986,930,829 shares of its
Series A common stock outstanding, with a par value of $0.001, and
133,818,177 shares of its Series B common stock outstanding, with
a par value of $0.001.
About China Tel
Based in San Diego, California, and Shenzhen, China, China Tel
Group, Inc. (OTC BB: CHTL) -- http://www.ChinaTelGroup.com/--
provides high speed wireless broadband and telecommunications
infrastructure engineering and construction services. Through its
controlled subsidiaries, the Company provides fixed telephony,
conventional long distance, high-speed wireless broadband and
telecommunications infrastructure engineering and construction
services. ChinaTel is presently building, operating and deploying
networks in Asia and South America: a 3.5GHz wireless broadband
system in 29 cities across the People's Republic of China with and
for CECT-Chinacomm Communications Co., Ltd., a PRC company that
holds a license to build the high speed wireless broadband system;
and a 2.5GHz wireless broadband system in cities across Peru with
and for Perusat, S.A., a Peruvian company that holds a license to
build high speed wireless broadband systems.
After auditing the 2011 results, Kabani & Company, Inc., in Los
Angeles, California, expressed substantial doubt as to the
Company's ability to continue as a going concern. The independent
auditors noted that the Company has incurred a net loss for the
year ended Dec. 31, 2011, cumulative losses of $254 million since
inception, a negative working capital of $16.4 million and a
stockholders' deficiency of $9.93 million.
The Company reported a net loss of $21.79 in 2011, compared with a
net loss of $66.62 million in 2010.
The Company's balance sheet at March 31, 2012, showed
$13.57 million in total assets, $19.53 million in total
liabilities and a $5.95 million total stockholders' deficiency.
CHRIST THE ROCK: Files for Chapter 11 Protection to Avoid Takeover
------------------------------------------------------------------
Andrew J. Hawkins at Crain's New York Business reports that Christ
the Rock International has filed for Chapter 11 bankruptcy.
According to the report, Bishop Jonathan Owhe, the church's
founder, chairman and general overseer, said the bankruptcy filing
was necessary to avoid a takeover by the church's main lender, the
Evangelical Christian Credit Union. "The members of the church
have attempted through all kinds of ways and means to pay them,
but they became predatory, and hired an attorney that is so
vicious," the report quotes Bishop Owhe said. This is the third
time the church has had to file for bankruptcy protection.
The report relates Christ the Rock said it owes $37,320 to the
credit union, according to the bankruptcy filing. The church's
total debt is $480,000, while its assets total $1.22 million.
"They want to increase their asset network," Bishop Owhe said of
the credit union, according to the report. "And they see the
church as a source of real estate for housing."
The report says bankruptcy will allow Christ the Rock to
restructure its assets and perhaps avoid having to sell to the
credit union.
The report notes Christ the Rock will stay open in the meantime.
Christ the Rock International is a 17-year-old, 400-member church
in East New York, Brooklyn.
CHRISTOPHER TSCHERNE: Voluntary Chapter 11 Case Summary
-------------------------------------------------------
Debtor: Christopher Tscherne & Associates, Inc.
80-14 Eliot Avenue
Middle Village, NY 11379
Bankruptcy Case No.: 12-44381
Chapter 11 Petition Date: June 13, 2012
Court: U.S. Bankruptcy Court
Eastern District of New York (Brooklyn)
Judge: Carla E. Craig
Debtor's Counsel: Matthew Cabrera, Esq.
M. CABRERA & ASSOCIATES, PC
One Executive Boulevard, Suite 201
Suffern, NY 10901
Tel: (845) 678-1925
Fax: (845) 230-6643
E-mail: mcabecf@mcablaw.com
Estimated Assets: $100,001 to $500,000
Estimated Debts: $1,000,001 to $10,000,000
The Company did not file a list of creditors together with its
petition.
The petition was signed by Christopher Tscherne, secretary.
CLIFFS CLUB: Asks for Plan Exclusivity Until Oct. 1
---------------------------------------------------
The Cliffs Club & Hospitality Group, Inc., et al., ask the U.S.
Bankruptcy Court for the District of South Carolina to extend
their exclusive solicitation period until Oct. 1, 2012.
Out of abundance of caution, the Debtors requested for an
extension because they might require additional time to negotiate
with creditors and parties-in-interest with respect to the
solicitation of acceptances of the Plan. The Debtors' exclusive
solicitation period is set to expire on Aug. 26, 2012.
As reported in the Troubled Company Reporter on May 25, 2012,
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reported that the Debtor filed a proposed reorganization plan to
carry out a sale of the business. Competing bidders dropped out
before the auction where Carlile Development Group was already
under contract to buy the projects through confirmation of a
Chapter 11 reorganization plan. Carlile will be joined in buying
the projects by SunTx Urbana GP I LLP and Arendale Holdings Corp.
The report related that according to the explanatory disclosure
statement, the plan calls for paying a total of $64 million spread
over 20 years without interest to holders of $73.5 million notes.
The lenders will receive the greater of $1 million a year or half
of cash flow. The outstanding balance will be paid at maturity.
Unsecured creditors with an estimated $3.9 million in claims are
predicted to have a 75% recovery. Mechanics lienholders with $1.5
million in claims will be paid in full without interest.
Members would be invited to join the newly reorganized club.
About Cliffs Club
Units of The Cliffs Communities, led by The Cliffs Club &
Hospitality Group, Inc., doing business as The Cliffs Golf &
Country Club, along with 10 affiliates, sought Chapter 11
protection (Bankr. D. S.C. Lead Case No. 12-01220) on Feb. 28,
2012.
The Cliffs has eight premier, private master-planned residential
communities, each to have its own world-class golf course.
Approximately 3,734 lots have been sold. There are currently
1,385 finished homes, with 63 under construction. The properties
for sale are owned by non-debtor DevCo entities.
The Feb. 28 Debtors operate the exclusive membership clubs for
golf, tennis, wellness and social activities at The Cliffs'
communities in North and South Carolina. The clubs have 2,280
members, and there are 766 resigned members with refundable
deposits totaling $37 million. The Debtors do not own the golf
courses -- they only own or lease all the "core amenities" for the
operation of the golf courses.
Another affiliate, Keowee Falls Investment Group, LLC, filed a
Chapter 11 petition (Bankr. D. S.C. Case No. 12-01399) in
Spartanburg, South Carolina, on March 2, 2012. Travelers Rest-
based Keowee Falls estimated at least $100 million in assets and
liabilities of up to $50 million.
Judge John E. Waites presides over the Debtors' cases. Lawyers
at McKenna Long & Aldridge LLP serve as the Debtors' lead counsel.
Dana Elizabeth Wilkinson, Esq., serves as local counsel. Grisanti
Galef & Goldress serves as restructuring advisors and Katie S.
Goodman of GGG serves as CRO. BMC Group Inc. serves as the
Debtors' claims and noticing agent.
According to papers filed in Court, the Debtors' total assets had
a $175 million book value at Dec. 31, 2011. The Debtors' total
liabilities had a $333 million book value at Dec. 31, 2011. The
petition was signed by Timothy P. Cherry, authorized officer.
Wells Fargo, as Indenture Trustee, is represented in the case by
Daniel S. Bleck, Esq., at Mintz Levin Cohn Ferris Glovsky and
Popeo P.C.; and Elizabeth J. Philp, Esq., and Michael Beal, Esq.,
at McNair Law Firm P.A.
The Official Committee of Unsecured Creditors is represented in
the case by John B. Butler, III, P.A., and Jonathan B. Alter,
Esq., at Bingham McCutchen LLP.
COMSTOCK MINING: Accused of Using Land Without Authorization
------------------------------------------------------------
Comstock Mining Inc. received a notice from the Sierra Front Field
Office of the Bureau of Land Management (BLM) requiring the
Company to cease using certain land that facilitates efficient
transportation of material, primarily due to allegations of use
without authorization. The Company believes that the allegations
in the Notice are not supported by the facts. The Notice permits
30 days to present evidence of the Company's authority. The
Company will be filing an appropriate response with the BLM, to
enable a timely and positive resolution.
The Notice appears to dispute the legal ownership of a 25-acre lot
in the Gold Hill Town site. The Company said it has documented
the private ownership of Lot 51 under clear title dating back to
1869. The Company adds that Storey County has collected private
property taxes since then on this land, and upholds private
ownership in a letter written to the BLM by the County dated
Nov. 2, 2011. Documentation supporting the Company's position is
available and will be submitted timely.
This Notice does not impact the construction activities ongoing at
our processing site and does not directly impact the preparation
and construction of the mine. Both will proceed on schedule.
"We are surprised with the Notice from Field Manager Thomas,"
stated Corrado De Gasperis, President and CEO of Comstock Mining.
"We will, of course, fully comply with the Notice. We have a good
and longstanding relationship with the BLM and will work
constructively to resolve this matter quickly. Construction will
remain on schedule while we respond and resolve the allegations in
the Notice."
About Comstock Mining
Virginia City, Nev.-based Comstock Mining Inc. is a Nevada-based,
gold and silver mining company with extensive, contiguous property
in the historic Comstock district. The Company began acquiring
properties in the Comstock in 2003. Since then, the Company has
consolidated a substantial portion of the Comstock district,
secured permits, built an infrastructure and brought the
exploration project into test mining production. The Company
continues acquiring additional properties in the Comstock
district, expanding its footprint and creating opportunities for
exploration and mining. The goal of the Company's strategic plan
is to deliver stockholder value by validating qualified resources
(measured and indicated) and reserves (probable and proven) of
3,250,000 gold equivalent ounces by 2013, and commencing
commercial mining and processing operations by 2011, with annual
production rates of 20,000 gold equivalent ounces.
The Company reported a net loss of $11.61 million in 2011,
compared with a net loss of $60.32 million in 2010.
The Company's balance sheet at March 31, 2012, showed
$40.97 million in total assets, $14.64 million in total
liabilities, and $26.33 million in total stockholders' equity.
COVERDELL ENTERPRISES: Case Summary & 6 Largest Unsec Creditors
---------------------------------------------------------------
Debtor: Coverdell Enterprises, Inc.
3644 E. Kirkwood
Springfield, MO 65809
Bankruptcy Case No.: 12-61112
Chapter 11 Petition Date: June 14, 2012
Court: United States Bankruptcy Court
Western District of Missouri (Springfield)
Judge: Arthur B. Federman
Debtor's Counsel: Diana P. Brazeale, Esq.
BRAZEALE LAW FIRM, LLC
500 W. Main St., Suite 203D
Branson, MO 65616
Tel: (417) 334-7494
Fax: (417) 334-7405
E-mail: diana@brazealelaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 6 largest unsecured creditors
filed together with the petition is available for free at
http://bankrupt.com/misc/mowb12-61112.pdf
The petition was signed by Douglas Lee Coverdell, president.
CULINARY HEALTH: Case Summary & 19 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Culinary Health Innovations, LLC
208 Meadowood Drive
South Burlington, VT 05403
Bankruptcy Case No.: 12-10529
Chapter 11 Petition Date: June 14, 2012
Court: United States Bankruptcy Court
District of Vermont (Rutland)
Judge: Colleen A. Brown
Debtor's Counsel: Rebecca A. Rice, Esq.
COHEN & RICE
26 West St, Suite 1
Rutland, VT 05701-3274
Tel: (802) 775-2352
E-mail: Steeplbush@aol.com
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 19 largest unsecured creditors
filed together with the petition is available for free at
http://bankrupt.com/misc/vtb12-10529.pdf
The petition was signed by David Thompson, CEO.
DESERT GARDENS: US Bank Wants Disclosure Statement Disapproved
--------------------------------------------------------------
US Bank National Association, as trustee, asks the U.S. Bankruptcy
Court for the District of Arizona to deny approval of the
Disclosure Statement explaining Desert Gardens IV, LLC's Plan of
Reorganization Dated March 5, 2012.
US Bank is also successor in interest to Bank of America, National
Association, as Trustee, successor by merger to LaSalle Bank
National Association, as Trustee, for the registered holders of
Bear Stearns Commercial Mortgage Securities Inc., Commercial
Mortgage Pass-Through Certificates, Series 2007-PWR15.
According to US Bank, the Disclosure Statement has a number of
deficiencies, including:
1. inadequate information concerning the Debtor's basis for
capping US Bank's secured claim at an amount ($24,660,000) less
than the value of US Bank's collateral (the real estate alone has
been appraised for $27,450,000);
2. inadequate information regarding the basis for the Debtor's
contention that US Bank is not entitled to recover any "default
interest, late charges, yield maintenance premium, or any other
fees, costs, expenses or charges alleged to have been triggered or
become due on account of any default under the USB Loan
Documents;" and
3. inadequate information regarding the Plan's violation of the
absolute priority rule that arises by virtue of the fact that the
Debtor's owners will retain their ownership interests without
contributing sufficient new value, or any new value at all.
As reported in the Troubled Company Reporter on March 8, 2012,
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reported that to fend off foreclosure, the Debtor filed a proposed
Chapter 11 plan designed to pay all creditors in full. The plan
filed by Desert Gardens IV LLC says that secured debt of $24.7
million would be paid over 30 years, at 4.25% interest. The new
mortgage would pay interest only for the first two years.
Unsecured claims of about $85,000 would be paid in full.
The report noted that U.S. Bank NA, as trustee for the trust
owning the securitized mortgage, has a pending a motion seeking to
proceed with the foreclosure of the property, saying that the
reorganization is hopeless.
The Debtor, a single-asset real estate, claims that its secured
debt is $24.7 million. U.S. Bank asserts $32.3 million in claims.
securitized mortgage, contends the debt is $32.3 million,
including a so-called yield-maintenance obligation.
About Desert Gardens IV
Desert Gardens IV LLC, owner of a 532-unit Desert Gardens
apartments in Glendale, Arizona, filed for Chapter 11 protection
to halt foreclosure that was set for Nov. 14. The project has two
31-story towers, one built in 1983 and the other in 2003. U.S.
Bank, the secured lender, is owed $26.3 million. The property is
estimated to be worth $16 million.
Desert Gardens IV filed a Chapter 11 petition (Bankr. D. Ariz.
Case No. 11-31061) on Nov. 4, 2011, in Phoenix. Jennings, Strouss
& Salmon, P.L.C., serves as the Debtor's counsel. Sierra
Consulting Group, LLC, is the financial advisor. The Debtor
disclosed $16.14 million in assets and $27.14 million in
liabilities in its schedules.
The U.S. Trustee has not yet appointed a creditors committee in
the Debtor's case because an insufficient number of persons
holding unsecured claims against the Debtor have expressed
interest in serving on a committee.
DEWEY & LEBOEUF: Agrees to End Employee Pensions
------------------------------------------------
Thomson Reuters News & Insight reports that Dewey & LeBoeuf has
agreed to officially terminate its employee pensions, allowing the
U.S. Pension Benefit Guaranty Corporation to step in as trustee.
According to the report, U.S. District Judge Jesse Furman in
Manhattan signed a consent order on Wednesday terminating three
employee pension funds, which were underfunded by $80 million and
covered 1,800 former Dewey employees, according to the agency.
The order also named the PBGC as the funds' trustee, giving the
agency the ability to pursue claims for the funds in Dewey's
bankruptcy.
The report notes the PBGC, having assumed the $80 million in
liabilities associated with the funds, becomes Dewey's largest
unsecured creditor. The agency will also assume responsibility
for paying benefits to Dewey's retirees. The maximum annual
benefit for a 65-year-old retiree is close to $56,000.
The report adds a hearing had been scheduled for June 21, 2012,
to resolve a dispute over the date pension plans should be
terminated, but it was canceled in light of the court's order. In
court filings, Dewey had argued that the effective date should be
later than May 11, the date the agency provided. It is unclear
why the firm fought that exact date, which was a day after PBGC
announced its plans to seize control of the plans.
According to the report, the PBGC had said it moved to seize the
plans to secure its ability "to collect against the firm's
affiliates that share funding responsibility for the pension
plans." Those affiliates include overseas offices Dewey sold to
other law firms.
The report adds bankruptcy court records filed May 29 show that
the PBGC received $2 million of the $6 million that Dewey got from
the May 11 sale of its Warsaw office to Greenberg Traurig. The
PBGC received another $1.5 million from the nearly $4.17 million
that Morgan Lewis & Bockius paid to acquire Dewey's offices in
Russia and Kazakhstan.
About Dewey & LeBoeuf
New York-based law firm Dewey & LeBoeuf LLP sought Chapter 11
bankruptcy (Bankr. S.D.N.Y. Case No. 12-12321) to complete the
wind-down of its operations. The firm had struggled with high
debt and partner defections. Dewey disclosed debt of $245 million
and assets of $193 million in its chapter 11 filing late evening
on May 29, 2012.
Dewey & LeBoeuf was formed by the 2007 merger of Dewey Ballantine
LLP and LeBoeuf, Lamb, Greene & MacRae LLP. At its peak, Dewey
employed about 2,000 people with 1,300 lawyers in 25 offices
across the globe. When it filed for bankruptcy, only 150
employees were left to complete the wind-down of the business.
Dewey's offices in Hong Kong and Beijing are being wound down.
The partners of the separate partnership in England are in process
of winding down the business in London and Paris, and
administration proceedings in England were commenced May 28. All
lawyers in the Madrid and Brussels offices have departed. Nearly
all of the lawyers and staff of the Frankfurt office have
departed, and the remaining personnel are preparing for the
closure. The firm's office in Sao Paulo, Brazil, is being
prepared for closure and the liquidation of the firm's local
affiliate. The partners of the firm in the Johannesburg office,
South Africa, are planning to wind down the practice.
The firm's ownership interest in its practice in Warsaw, Poland,
was sold to the firm of Greenberg Traurig PA on May 11 for $6
million. The Pension benefit Guaranty Corp. took $2 million of
the proceeds as part of a settlement.
Judge Martin Glenn oversees the case. Albert Togut, Esq., at
Togut, Segal & Segal LLP, represents the Debtor. Epiq Bankruptcy
Solutions LLC serves as claims and notice agent. The petition was
signed by Jonathan A. Mitchell, chief restructuring officer.
JPMorgan Chase Bank, N.A., as Revolver Agent on behalf of the
lenders under the Revolver Agreement, hired Kramer Levin Naftalis
& Frankel LLP. JPMorgan, as Collateral Agent for the Revolver
Lenders and the Noteholders, hired FTI Consulting and Gulf
Atlantic Capital, as financial advisors. The Noteholders hired
Bingham McCutchen LLP as counsel.
The U.S. Trustee formed two committees -- one to represent
unsecured creditors and the second to represent former Dewey
partners. The creditors committee hired Brown Rudnick LLP led by
Edward S. Weisfelner, Esq., as counsel. The Former Partners hired
Tracy L. Klestadt, Esq., and Sean C. Southard, Esq., at Klestadt &
Winters, LLP, as counsel.
Dewey & LeBoeuf has won Court authority to use lenders' cash
collateral through July 31, 2012.
DIAMOND BEACH: July 2 Hearing Set for Request to Use DIP Financing
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas, in a
second interim order, authorized Diamond Beach VP, LP to incur
postpetition indebtedness.
The Court ordered that the Debtor may draw the funds necessary
under the DIP Promissory Note to pay expenses, with up to 10&
total variance on budgeted amounts.
Additionally, the Court ordered that the claim of Randall J. Davis
for funds advanced under the DIP promissory note will be an
unsecured claim, with subordinated priority to (a) fees and
expenses of the Clerk of Court, or the Office of the U.S. Trustee;
(b) outstanding and unpaid postpetition fees and expenses of the
professionals retained by the Debtor; and (c) the administrative
expense, if any.
The Court further stated that the objections of International Bank
of Commerce are preserved for final hearing.
The Court set the final hearing on July 2, 2012 at 11 a.m.
Intra-District Transfer
According to the case docket, the Court entered an order dated
May 18, 2012, abating pleadings on emergency motion, emergency
motion, motion to transfer case (intra-district), and motion to
dismiss case. In this relation, International Bank of Commerce
filed on April 12, an expedited motion for the intra-district
transfer of the Debtor's case.
About Diamond Beach VP, LP
Houston, Texas-based Diamond Beach VP, LP, filed a Chapter 11
petition (Bankr. S.D. Tex. Case No. 12-10175) in Brownsville on
April 2, 2012. The Debtor, a Single Asset Real Estate as defined
in 11 U.S.C. Sec. 101 (51B), disclosed $30.05 million in assets
and $28.24 million in liabilities in its schedules.
The Debtor owns the Diamond Beach Condominiums located at
Galveston, Texas. The property is worth $29.4 million and secures
a $27.3 million debt to the International Bank of Commerce.
Judge Richard S. Schmidt oversees the case. Edward L. Rothberg,
Esq., at Hoover Slovacek, LLP, serves as the Debtor's counsel.
The petition was signed by Randall J. Davis, as manager of the
Debtor's general partner.
DIPPIN' DOTS: Court Signs Stipulation for Cash Collateral Use
-------------------------------------------------------------
The Hon. Thomas H. Fulton of the U.S. Bankruptcy Court for the
Western District of Kentucky, in a final order, signed the
expedited stipulation and agreed order between Dippin' Dots Inc.,
and Regions Bank amending DIP financing and cash collateral order.
The Debtor is authorized to borrow the additional DIP funds from
Regions in the amount of up to $1.5 million (in addition to the
amounts previously authorized), all without prejudice to the right
of the Debtor and Regions to return to Court for further requests
regarding DIP funding or modification of the existing DIP funding.
The additional DIP funding authorized is on the same terms and
conditions set forth in the prior DIP orders.
Regions Bank holds a validly perfected security interest on
inventory, accounts receivable, cash, furniture and fixtures, and
other intangibles. As of the bankruptcy filing date, Regions Bank
is owed $11.10 million collectively, on eight different promissory
notes.
About Dippin' Dots
Founded in 1988 by microbiologist Curt Jones, Dippin' Dots Inc.
manufactures quirky and colorful ice cream beads, which are flash
frozen using liquid nitrogen. It owns a 120,000-square-foot plant
in Kentucky that can produce more than 25,000 gallons of frozen
dots a day. It has about 140 Dippin' Dots retail locations, which
are mostly controlled by franchisees, and agreements with 9,952
small vendors who sell the ice cream at fairs, festivals and
sports games. Dippin' Dots isn't sold in grocery stores because
of its extreme cooling requirements.
Dippin' Dots filed a Chapter 11 petition (Bankr. W. D. Ky Case No.
11-51077) on Nov. 3, 2011 in Paducah, Kentucky. Judge Thomas H.
Fulton presides over the case. Farmer & Wright, PLLC, represents
the Debtor as Chapter 11 counsel. The Debtor disclosed
$20,233,130 in assets and up to $20,233,130 in debts. The
petition was signed by Curt Jones, president.
Regions Bank, the Debtor's secured lender, is represented by Brian
H. Meldrum, Esq., at Stites & Harbison PLLC.
In February 2012, Regions Bank filed a motion seeking appointment
of a Chapter 11 trustee. After talks with the Debtor, Regions
consented to having a chief restructuring officer. Regions wanted
a trustee in part based on allegations that the company's chief
executive fraudulently transferred his ownership of a franchising
affiliate to prevent the bank from attaching the affiliate in
satisfaction of debt on a guarantee.
DRI INC: Digital Sign Business Auctioned for $25.3 Million
----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that DRI Inc. held an auction where the price rose 14%
from the opening bid of $22.1 million made by affiliate of Levine
Leichtman Capital Partners Inc. Levine Leichtman won the auction
at a price of $25.3 million, bidding against one other prospective
buyer. There will be a hearing in bankruptcy court on June 20 for
approval of the sale. The final price is subject to an adjustment
for working capital. DRI previously said the price should be
sufficient to pay secured creditors in full and cover expenses of
the bankruptcy, with a surplus for unsecured creditors.
About DRI Corp.
DRI Corp. (OTCQB:TBUS) -- http://www.digrec.com/-- a provider of
digital signs for transportation systems, filed a Chapter 11
petition in Wilson, North Carolina (Bankr. E.D.N.C. Case No.
12-02298) on March 25, 2012. DRI intends to sell its assets and
operations under Section 363 of Chapter 11 of the U.S. Bankruptcy
Code.
Dallas, Texas-based DRI disclosed assets of $42.8 million and
liabilities totaling $31.4 million. Debt includes $9.6 million
owing to Interim Funding III LP, a secured lender with liens on
all assets.
Affiliates Digital Recorders, Inc., TwinVision of North America,
Inc., and Robinson Turney International, Inc., also sought
bankruptcy protection (Case Nos. 12-02299, 12-02300 and 12-02302).
The cases are jointly administered.
Judge Randy D. Doub presides over the case. The petition was
signed by David L. Turney, chairman and CEO. Northen Blue, LLP,
serves as the Debtors' counsel. Elaine T. Rudisill and The Finley
Group, Inc., serve as chief restructuring officer and financial
consultants. Morgan Keegan & Company, Inc., serves as marketing
consultants. Wyrick Robbins Yates & Ponton, LLP, serves as
special counsel with respect to corporate law matters.
ENERGY CONVERSION: Court Denies Panel's Request to End Exclusivity
------------------------------------------------------------------
The Hon. Thomas J. Tucker of the U.S. Bankruptcy Court for the
Eastern District of Michigan denied the motion of the Official
Committee of Unsecured Creditors in the Chapter 11 cases of Energy
Conversion Devices, Inc. and United Solar Ovonic LLC, to (1) to
adjourn solicitation of voting on the Debtors' Second Amended Plan
of Liquidation, and (2) to terminate the Debtors' exclusivity
period.
Several parties objected to the Committee' motion. The Debtors,
in their objection, stated that it was the wrong time to terminate
exclusivity or delay the solicitation of their proposed plan. The
Debtors are preparing to solicit a plan that was the product of
months of good-faith negotiation between the Debtors, the
Committee, and the Ad Hoc Consortium, which will fully and fairly
resolve numerous complex inter-creditor and inter-Debtor issues.
If the plan is confirmed, all parties will benefit from the rapid
conclusion of the chapter 11 cases.
The Ad Hoc Consortium of Noteholders explained that there is
absolutely no factual or legal basis to take the extraordinary
measure of terminating the Debtors' exclusivity within the initial
exclusive period. If the Joint Plan fails to gain necessary
acceptance or confirmation, all parties will then be free to
consider all alternatives.
The Official ECD Creditors Sub-Committee of the Committee, in its
objection, stated that the Committee proposed to disseminate to
creditors competing stand-alone liquidation plans, when it does
not even know whether it believes those plans are in the best
interests of unsecured creditors or whether the Plan, with its
proposed substantive consolidation, is in the best interests of
its constituents. The ECD Creditors Sub-Committee submitted that
the motion was both legally and practically unsupportable.
The Second Amended Plan
The Debtors' Second Amended Plan of Liquidation dated May 31,
2012, provides for the sale of substantially all of the assets of
the Debtors to any purchaser. Subject to the terms of the Plan,
any and all Liens, Claims and encumbrances are deemed to attach to
the proceeds of the sale of the purchased assets with the same
validity, priority, force and effect as such liens, Claims and
encumbrances had on the purchased assets prior to the Petition
Date.
Under the Plan:
Class 2A: Secured Claims of ECD -- Subject to the occurrence of
the Effective Date, Secured Claims in Class 2A will be eliminated.
Class 2B: Secured Claims of Wieland-Davco Corporation -- Holder
of any Allowed Secured Claim in Class 2B will receive either: (i)
Cash in an amount of the Allowed Secured Claim, or (ii) in the
discretion of the Debtors, transfer of title to the Collateral
securing the Allowed Secured Claim.
Class 3: General Unsecured Claims -- Each holder of an Allowed
General Unsecured Claim will receive a Pro Rata beneficial
interest in the Liquidation Trust and any proceeds or
distributions on account of the beneficial interest.
Class 4: Warranty Claims -- Subject to the occurrence of the
Effective Date, each holder of an Allowed Warranty Claim will
receive from the Warranty Trust at the Liquidation Trustee's
election cash or inventory in an amount not to exceed the Warranty
Claimant Percentage Amount. For purposes of calculating the
distribution amount, inventory will be valued at Debtors'
cost to manufacture the inventory.
Class 5: Equity Interests -- To the extent funds remain after
payment in full of all Allowed Claims, holders of Allowed Equity
Interests of ECD will receive Pro Rata payment of any surplus.
The treatment will be in full satisfaction of their Allowed Equity
Interests and the Equity Interests will be terminated as of the
Effective Date. ECD's Equity Interests in USO will vest in the
Liquidation Trust as of the Effective Date.
About Energy Conversion
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.
ECD filed for Chapter 11 protection (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 SOLUTIONS: S&P's "B" Rating is Above Moody's
---------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that although EnergySolutions LLC was dealt a two-level
downgrade on June 15 by Standard & Poor's, the consolation prize
for the nuclear waste processor is that the new S&P corporate
rating at B is one grade higher than the ding issued three days
before by Moody's Investors Service.
Like Moody's, S&P attributed the downgrade to a decline in
shipments of radioactive waste to the company's disposal site in
Utah. Another factor cited by both rating companies was the
disclosure by EnergySolutions that a decommissioning project
won't result in the expected return on capital investment.
Mr. Rochelle relates that EnergySolutions plunged 55% on June 11
to close at a record low of $1.62 after announcing a change in
management and reducing its projection for cash flow. The shares
closed June 15 at $1.69 in New York trading, down from a three-
year closing high of $9.57 on Aug. 21, 2009. The company's $300
million in 10.75% senior unsecured bonds due in 2018 last traded
on June 15 for 91.8 cents on the dollar, to yield about 12.7%,
according to Trace, the bond-price reporting system of the
Financial Industry Regulatory Authority.
The company, based in Salt Lake City, generated $1.8 billion in
revenue during the year ended in March, Moody's said.
FIRST NATIONAL: Court Dismisses Chapter 11 Reorganization Case
--------------------------------------------------------------
The Hon. Niles Jackson of the U.S. Bankruptcy Court for the
Western District of Oklahoma dismissed the Chapter 11 cases of
First National Building I, LLC, and First National Building II,
LLC.
The Court approved the settlement entered into between the Debtors
and LVI Environmental Services, Inc.
The Court also ordered that, among other things:
-- that the closing date under the Capmark Settlement Agreement
is extended, from May 27, 2012, until June 26;
-- that the Debtors will deposit $250,000 in immediately
available federal funds, which sum will not come from the
Debtors' existing cash collateral, into a client trust
account maintained by Levene, Neale, Bender, Yoo & Brill
L.L.P.; and
-- the Court will, notwithstanding the dismissal of the
Debtors' Chapter 11 bankruptcy cases, retain jurisdiction
sufficient to hear any dispute, claim or controversy arising
out of or relating to the terms, conditions and obligations
contained in the settlements approved by the Court, i.e. a
Settlement Agreement entered into by the Debtors, M. Aaron
Yashouafar and Simon Barlava, and Capmark Bank and Capmark
CDF Subfund VI LLC, which was approved pursuant to the order
dated March 28, 2012.
A full-text copy of the order setting the terms of the dismissal
is available for free at
http://bankrupt.com/misc/FIRSTNATIONAL_dismissal_order.pdf
About First National
Sherman Oaks, California-based First National Building I, LLC, and
First National Building II, LLC, are the co-owners of the real
property commonly known as the First National Center and located
at 120 N. Robinson Avenue in Oklahoma City. The property is a 33-
story historic office building located in the central business
district in Oklahoma City and contains approximately 950,000
square feet of rentable space.
The Honorable Geraldine Mund entered an order directing the
transfer of the Chapter 11 cases of First National Building I,
LLC, and First National Building II, LLC, from the Central
District of California to the Western District of Oklahoma.
Lender Capmark Bank and Capmark CDF Subfund VI LLC made the
request, and Judge Mund agreed to the venue change.
First National Building I, LLC, filed a Chapter 11 petition
(Bankr. C.D. Calif. Case No. 10-22745) in Woodland Hills, Calif.,
on Oct. 7, 2010, and the case was transferred (Bankr. W.D. Okla.
Case No. 10-16334) to Oklahoma City on Oct. 13, 2010. First
National Building II, LLC, filed a Chapter 11 petition (Bankr.
C.D. Calif. Case No. 10-22747) in Woodland Hills, Calif. on
Oct. 7, 2010, and the case was transferred (Bankr. W.D. Okla. Case
No. 10-16335) to Oklahoma City on Oct. 13, 2010. Keith M.
Aurzada, Esq., and John C. Leininger, Esq., at Bryan Cave LLP, in
Dallas, Tex., and Rob F. Robertson, Esq., at GableGotwals, in
Oklahoma City, Okla., represent Capmark as counsel.
The Debtors each estimates assets and debts at $10 million to
$50 million.
The Debtors are affiliated with Roosevelt Lofts, LLC (Bankr. C.D.
Calif. Case No. 09-14214).
David L. Neale, Esq., and Juliet Y. Oh, Esq., at Levene, Neale,
Bender, Yoo & Brill L.L.P., in Los Angeles; and Mark B. Toffoli,
Esq., at Andrews Davis, P.C., in Oklahoma City, Okla., represent
the Debtors as counsel.
FOUR SEASONS: Chapter 11 Reorganization Case Dismissed
------------------------------------------------------
The Hon. A. Jay Cristol of the U.S. Bankruptcy Court for the
Southern District of Florida dismissed the Chapter 11 case of Four
Seasons 66B Investments, Corp., with prejudice to the Debtor in
filing of a petition under any chapter of the United States
Bankruptcy Code for a period of 180 days from the May 17, 2012,
order.
The Court also ordered that the Debtor will pay the U.S. Trustee
the appropriate sum required pursuant to Section 1930(a)(6) of the
Bankruptcy Code.
As reported in the Troubled Company Reporter on Feb. 2, 2012,
Donald F. Walton, Acting U.S. Trustee for Region 21, sought for
the case's dismissal, stating that:
1. The Debtor's only asset is its interest in a condominium
unit in the Four Seasons Condominium Building in Miami,
Florida, valued at $1,260,000. The condominium is
encumbered by a mortgage listed as secured debt of
$1,555,765. The Debtor lists no unsecured debt.
2. JP Morgan Chase holds the mortgage on the condominium, and
on Aug. 12, 2011, filed a motion for stay relief which
motion was granted by the Court in Order Granting Stay
Relief on Sept. 7, 2011.
3. The Debtor's sole reason for filing bankruptcy was to
attempt to refinance or sell the condominium before it was
sold in foreclosure. That reason is now moot since JP
Morgan Chase obtained stay relief to continue and complete
foreclosure proceedings in state court and sale the
condominium.
4. The Debtor has not filed monthly operating reports ("MORs")
since March 2011, as required by Local Bankruptcy Rule 2015-
1.
5. The Debtor has not paid this obligation to the United States
Trustee for the second, third and fourth quarter of 2011
with estimated fees owed of $1,956.
About Four Seasons
Coral Gables, Florida-based Four Seasons 66B Investments Corp.
filed for Chapter 11 bankruptcy protection (Bankr. S.D. Fla. Case
No. 10-23713) on May 19, 2010. Cesar J. Dominguez, Esq., served
as counsel to the Company. The Company estimated its assets and
debts at $100 million to $500 million as of the Chapter 11 filing.
GAMETECH INT'L: Delays Form 10-Q for April 29 Quarter
-----------------------------------------------------
GameTech International, Inc., was unable to file its Form 10-Q for
the period ended April 29, 2012, within the prescribed time period
without unreasonable effort and expense. The delay is primarily a
result of:
(1) staff turnover and reductions in the Company's accounting
department;
(2) management devoting a substantial amount of its time and
effort exploring strategic alternatives for the Company in
order to meet its operating and capital needs, including
business combinations, strategic partnerships and the sale
of Company assets; and
(3) management devoting a substantial amount of its time and
effort pursuing an amendment or other resolution to the
Company's credit facility in light of existing defaults.
As a result, the process of compiling and disseminating the
information required to be included in the Report, as well as the
completion of the required review of the Company's financial
information, could not be completed in a timely manner without
incurring undue hardship and expense. The Company will use all
available commercially reasonable efforts to file its Form 10-Q as
soon as possible, but can give no assurance tha the Report will be
filed by June 18, 2012, as prescribed in Rule 12b-25.
About Gametech International
Based in Reno, Nevada, GameTech develops and manufactures gaming
entertainment products and systems. GameTech holds a significant
position in the North American bingo market with its interactive
electronic bingo systems, portable and fixed-based gaming units,
and complete hall management modules. It also holds a significant
position in select North American VLT markets, primarily Montana,
Louisiana, and South Dakota, where it offers video lottery
terminals and related gaming equipment and software. It also
offers Class III slot machines and server-based gaming systems.
The Company reported a net loss of $20.4 million for the 52 weeks
ended Oct. 31, 2010, compared with a net loss of $10.5 million for
the 52 weeks ended Nov. 1, 2009.
The Company's balance sheet at Jan. 29, 2012, showed
$27.22 million in total assets, $22.88 million in total
liabilities, all current, and $4.34 million in stockholders'
equity.
Piercy Bowler Taylor & Kern expressed substantial doubt about the
Company's ability to continue as a going concern following the
fiscal 2011 financial results. All of the Company's debt
(approximately $23.4 million at Oct. 30, 2011) is classified as
current. The independent auditors noted that there is significant
uncertainty as to whether the Company will be able to satisfy all
conditions necessary to extend the maturity of those obligations.
GATEHOUSE MEDIA: Peter Newton Joins as Unit President
-----------------------------------------------------
GateHouse Media, Inc., hired Peter Newton to the newly created
position of President of GateHouse Ventures. GateHouse Ventures'
mission is to identify and develop high-growth business ventures
that can leverage Company resources and access local markets to
expand the local services we offer, while also expanding our
geographic reach.
Commenting on Mr. Newton's appointment, Kirk Davis, Chief
Operating Officer of GateHouse Media, said, "We are very excited
to announce the addition of Peter Newton as President of GateHouse
Ventures. Peter's appointment comes as we are moving from a
successful diligence phase in some of our new ventures to an
execution phase, a period in which we begin to scale our new
businesses. Peter will be directly working with the business unit
leaders and teams associated with our first two ventures, Propel
Marketing (propelmarketing.com) and Compass Aging Services
(compassaging.com). In addition, Peter will also work closely
with our directory business, SureWest, in Sacramento, and the
national expansion of adhance media (adhancemedia.com), our
private digital ad exchange, which is already up and running and
seeing positive growth."
Mr. Newton brings a distinguished media background that spans
traditional and digital publishing. Since 2010, he has been
building a successful consulting practice that specializes in
media and marketing services. He leveraged his expertise in sales
and marketing, and his knowledge of digital services and
technologies to help small and mid-sized businesses grow. Mr.
Newton spent 17 years at The Boston Globe where he held several
leadership positions in finance and advertising, which resulted in
his becoming VP Advertising. His role expanded when he added
responsibilities as President of BostonWorks, where he directed
the successful transformation of a traditional print business into
a multi-media company. Mr. Newton also held several leadership
positions at MONSTER including SVP/GM of Small & Mid-Sized
Businesses. He also launched MONSTER?s Media Alliances business,
scaling the business from having no partners to having over 350
nationally in just two years.
The Company also announced that Jay Fogarty, currently VP of New
Revenue Platforms who has been with the Company since 2009 and
helped found and develop the new business ventures group, will
become VP, Strategy and Innovation. He will continue to source
new business development opportunities company-wide, which is an
essential part of the Company's transformation into a truly multi-
media enterprise.
About GateHouse Media
GateHouse Media, Inc. -- http://www.gatehousemedia.com/--
headquartered in Fairport, New York, is one of the largest
publishers of locally based print and online media in the United
States as measured by its 97 daily publications. GateHouse Media
currently serves local audiences of more than 10 million per week
across 21 states through hundreds of community publications and
local Web sites.
The Company reported a net loss of $22.22 million for the year
ended Jan. 1, 2012, a net loss of $26.64 million for the year
ended Dec. 31, 2010, and a net loss of $530.61 million for the
year ended Dec. 31, 2009.
The Company's balance sheet at April 1, 2012, showed $493.34
million in total assets, $1.31 billion in total liabilities and a
$823.70 million total stockholders' deficit.
Bankruptcy Warning
According to the Form 10-K for the year ended Dec. 31, 2011, the
Company's ability to make payments on its indebtedness as required
depends on its ability to generate cash flow from operations in
the future. This ability, to a certain extent, is subject to
general economic, financial, competitive, legislative, regulatory
and other factors that are beyond the Company's control.
There can be no assurance that the Company's business will
generate cash flow from operations or that future borrowings will
be available to the Company in amounts sufficient to enable it to
pay its indebtedness or to fund our other liquidity needs.
Currently the Company does not have the ability to draw upon its
revolving credit facility which limits its immediate and short-
term access to funds. If the Company is unable to repay its
indebtedness at maturity the Company may be forced to liquidate or
reorganize its operations and business under the federal
bankruptcy laws.
GENERAL AUTO BUILDING: Files Schedules of Assets and Liabilities
----------------------------------------------------------------
General Auto Building, LLC, filed with the Bankruptcy Court its
schedules of assets and liabilities, disclosing:
NAME OF SCHEDULE ASSETS LIABILITIES
---------------- ------ -----------
A - Real Property $10,000,000
B - Personal Property $10,620
C - Property Claimed
as Exempt
D - Creditors Holding
Secured Claims $11,692,929
E - Creditors Holding Unsecured
Priority Claims $0
F - Creditors Holding Unsecured
Nonpriority Claims $1,826,424
------ -----------
TOTAL $10,010,620 $13,519,354
The Debtor said it owns a fee simple interest in a 48,000-square
foot commercial building located at 411 NW Park Ave, Portland,
Oregon. The General Auto Building is encumbered by multiple
secured creditors, including a $10,200,000 secured claim by
HomeStreet Bank.
General Auto Building, LLC, filed for Chapter 11 bankruptcy
(Bankr. D. Ore. Case No. 12-31450) on March 2, 2012. The Debtor
is an Oregon limited liability company formed in 2007 with its
principal place of business in Spokane, Washington. It was formed
to renovate and lease its namesake commercial property located at
411 NW Park Avenue, Portland, Oregon. As of the Petition date,
the Debtor has developed virtually all of the General Automotive
Building and has leased approximately 98% of the building's space
to retail and commercial tenants. The Debtor continues to seek
tenants for the remaining spaces.
Judge Elizabeth L. Perris presides over the case. Albert N.
Kennedy, Esq., and Ava L. Schoen, Esq., at Tonkon Torp LLP, serve
as the Debtor's counsel.
The U.S. Trustee was unable to appoint an official committee of
unsecured creditors in the case.
GENTA INC: Offering Amount Under Purchase Pact Hiked to $16-Mil.
----------------------------------------------------------------
Genta Incorporated and the requisite majority of the I Note
Investors entered into an amendment to the March 2012 Purchase
Agreement to increase the aggregate Offering Amount to $16.0
million of I Notes and to provide for an exercise of the Purchase
Option by the I Note Investors on a pro rata basis, in an amount
equal to $2.5 million.
As previously reported, on March 28, 2012, Genta entered into a
securities purchase agreement with certain accredited investors,
pursuant to which the Company agreed to issue up to $13.5 million
of 6.00% senior secured convertible promissory notes due March 30,
2022, convertible into shares of the Company's common stock, par
value $0.001 per share, at an initial conversion rate of 100,000
shares of Common Stock for every $100 of principal and accrued
interest due under the I Notes.
In connection with the signing of the March 2012 Purchase
Agreement, the Company received gross proceeds of $2.0 million
cash and was allowed to cancel approximately $2.0 million in
principal amount of certain 2008 senior secured convertible notes.
The Company issued an aggregate principal amount of $2.25 million
of I Notes to the I Note Investors, and the I Note Investors
retained an option to purchase an additional $11.25 million of I
Notes in a pro rata amount equal to each I Note Investor?s
original investment.
On June 14, 2012, the Company and certain holders of its existing
convertible notes entered into an amendment to the Note Amendment
Agreement dated March 30, 2012, and I Notes in which the
conversion limitation formula set forth in the convertible notes
of the Company held by any Non-Participating Investor, including I
Notes, will be revised so as to no longer permit conversions of
those notes by any Non-Participating Investor. Except as amended
by the Note Amendment, the terms of the additional I Notes are the
same as previously disclosed in connection with the March 2012
Financing. Proceeds from the June 2012 Financing will be used for
general corporate purposes.
On June 14, 2012, the Company entered into separate waiver
agreements with certain of the I Note Investors, whereby during
the week of June 18, 2012, to June 24, 2012, the weekly Conversion
Cap, as defined in the Note Amendment Agreement dated March 30,
2012, and I Notes, for all convertible notes of the Company,
including I Notes, held by each such I Note Investor will be
increased to 0.12410%, and each such I Note Investor affirmatively
agreed to convert the maximum permissible amount of convertible
notes held by such I Note Investor on June 18, 2012.
Notwithstanding the foregoing, in no event will any such I Note
Investor's ownership of Common Stock be allowed to exceed 9.999%
of the then issued and outstanding shares of Common Stock.
A copy of the Form 8-K is available for free at:
http://is.gd/mqh2cS
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.
In its report on the financial statements for 2011, 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.
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 March 31, 2012, showed $4.56
million in total assets, $34.74 million in total liabilities and a
$30.17 million total stockholders' deficit.
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.
GENTA INC: Board Grants 2-Bil. Restricted Shares to Executives
--------------------------------------------------------------
The Compensation Committee of the Board of Directors of Genta
Incorporated approved the grant of restricted stock to the
executive officers of the Company as follows: Raymond P. Warrell,
Jr. M.D. (800,000,000 shares); Loretta M. Itri, M.D. (650,000,000
shares); and Gary Siegel (550,000,000 shares). The number of
shares were determined relative to the fully-diluted capital stock
of the Company, assuming conversion of the outstanding securities
into common stock of the Company (approximately 67 billion shares
in the aggregate).
The restricted stock is intended to incentivize and retain the
Company's executive officers through the approval of the Company's
lead product candidate, and therefore, the restricted stock vests
100% upon the approval by the U.S. FDA of tesetaxel for any
indication. The executive officers must be employed on the
vesting date, and such equity automatically accelerates upon a
change of control of the Company.
The grant of the restricted stock was issued outside of the
Company's stock plan, and therefore, has not been registered under
the Securities Act of 1933, as amended, or any state securities
laws, and may not be offered or sold in the United States absent
an effective registration statement or an applicable exemption
from registration requirements. The issuance of the securities in
this transaction was exempt from registration under Section 4(2)
of the Securities Act.
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.
In its report on the financial statements for 2011, 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.
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 March 31, 2012, showed $4.56
million in total assets, $34.74 million in total liabilities and a
$30.17 million total stockholders' deficit.
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.
GENTA INC: Has 4.8 Billion Outstanding Common Shares
----------------------------------------------------
The number of outstanding shares of Genta Incorporated common
stock par value $0.001 as of June 15, 2012, is 4,846,615,013.
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.
In its report on the financial statements for 2011, 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.
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 March 31, 2012, showed $4.56
million in total assets, $34.74 million in total liabilities and a
$30.17 million total stockholders' deficit.
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.
GLOBAL AVIATION: Asks Court Approval of Employee Retention Plan
---------------------------------------------------------------
BankruptcyData.com reports that Global Aviation Holdings filed
with the U.S. Bankruptcy Court a motion for approval to implement
a non-insider key employee retention plan for five Section 119
employees.
According to the motion, the participants play a critical role in
complying with the safety, mechanical and operational standards
necessary to run the day-to-day approved systems and programs
supporting the operations of North American Airlines. The payments
will be structured as a percentage, ranging from 15% to 30%, of
the KERP participant's base salary and will be earned and payable
upon relocating operational control of North American. If the
Debtors successfully relocate North American Airlines' operations,
the maximum aggregate amount payable under the KERP will be
$137,031.
The Court scheduled a July 11, 2012 hearing to consider the KERP.
About Global Aviation Holdings
Global Aviation Holdings Inc., based in Peachtree City, Ga., is
the parent company of North American Airlines and World Airways.
Global is the largest commercial provider of charter air
transportation for the U.S. military, and a major provider of
worldwide commercial global passenger and cargo air transportation
services. North American Airlines, founded in 1989 and based in
Jamaica, N.Y., operates passenger charter flights using B757-200ER
and B767-300ER aircraft. World Airways, founded in 1948 and based
in Peachtree City, Ga., operates cargo and passenger charter
flights using B747-400 and MD-11 aircraft.
Global Aviation, along with affiliates, filed Chapter 11 petitions
(Bankr. E.D.N.Y. Case No. 12-40783) on Feb. 5, 2012.
Global's lead counsel in connection with the restructuring is
Kirkland & Ellis LLP and its financial advisor is Rothschild.
Kurtzman Carson Consultants LLC is the claims agent.
The Debtors disclosed $589.8 million in assets and $493.2 million
in liabilities as of Dec. 31, 2011. Liabilities include $146.5
million on 14% first-lien secured notes and $98.1 million on a
second-lien term loan. Wells Fargo Bank NA is agent for both.
Global said it will use Chapter 11 to shed 16 of 30 aircraft.
In addition, Global said it will use Chapter 11 to negotiate new
collective bargaining agreements with its unions and deal with
liabilities on multi-employer pension plans.
On Feb. 13, 2012, the U.S. Trustee for Region 2 appointed a seven
member official committee of unsecured creditors in the case. The
Committee tapped Lowenstein Sandler PC as its counsel, and
Imperial Capital, LLC as its financial advisor.
H&M OIL: Files Schedules of Assets and Liabilities
--------------------------------------------------
H&M Oil & Gas LLC filed with the Bankruptcy Court its schedules of
assets and liabilities, disclosing:
NAME OF SCHEDULE ASSETS LIABILITIES
---------------- ------ -----------
A - Real Property $257,007,950
B - Personal Property $40,111,823
C - Property Claimed
as Exempt
D - Creditors Holding
Secured Claims $76,868,843
E - Creditors Holding Unsecured
Priority Claims $0
F - Creditors Holding Unsecured
Nonpriority Claims $594,635
------ -----------
TOTAL $297,119,773 $77,463,479
Anglo-American Petroleum Corporation also filed its schedules of
assets and liabilities, disclosing:
NAME OF SCHEDULE ASSETS LIABILITIES
---------------- ------ -----------
A - Real Property $0
B - Personal Property $219,656,293
C - Property Claimed
as Exempt
D - Creditors Holding
Secured Claims $72,432,150
E - Creditors Holding Unsecured
Priority Claims $0
F - Creditors Holding Unsecured
Nonpriority Claims $0
------ -----------
TOTAL $219,656,293 $72,432,150
About H&M Oil
H&M Oil & Gas, LLC, filed a bare-bones Chapter 11 petition
(Bankr. N.D. Tex. Case No. 12-32785) in its hometown Dallas on
April 30, 2012. Another entity, Anglo-American Petroleum Corp.
(Case No. 12-32786) also filed for Chapter 11. Each of the
Debtors estimated assets and debts of $50 million to $100 million.
H&M Oil & Gas is an oil and gas production and development
company. H&M, through its operating company, H&M Resources LLC,
is focused on developing its leases in the Permian basin and Texas
panhandle. Dallas, Texas-based Anglo-American Petroleum --
http://www.angloamericanpetroleum.com/-- is the holding
corporation for H&M Oil.
Judge Barbara J. Houser presides over the case. The Debtors are
represented by Keith William Harvey, Esq., at Anderson Tobin PLLC,
in Dallas.
Prospect Capital Corporation, the Debtors' lone secured creditor,
is represented in the case by Timothy A. Davidson II, Esq., and
Joseph P. Rovira, Esq., at Andrews Kurth LLP.
In June 2012, the Bankruptcy Court denied the secured lender's
request for appointment of a Chapter 11 trustee and for relief
from the stay to foreclose.
HALE MOKU: June 28 Hearing Set for Case Dismissal/Conversion Plea
-----------------------------------------------------------------
The Hon. Vincent P. Zurzolo of the U.S. Bankruptcy Court for the
Central District of California will convene a hearing on June 28,
2012, at 9:30 a.m., to consider the U.S. Trustee's motion to
dismiss or convert the Chapter 11 case of Hale Moku LLC, to one
under Chapter 7 of the Bankruptcy Code.
On May 21, Peter C. Anderson, the U.S. Trustee for Region 16,
requested for the case dismissal or conversion of the Debtor's
case because, among other things:
-- to date, no disclosure statement or chapter 11 plan has been
filed; and
-- the Debtor has failed to comply with these U.S. Trustee's
requirements (i) notice of setting/increasing insider
compensation; (ii) application to employ attorney; (iii)
sufficient evidence of closing of all prepetition bank accounts;
and (iv) closing bank statements.
As reported in the Troubled Company Reporter on May 31, 2012,
secured creditor, OneWest Bank FSB, requested that the Court
convert the Debtor's case bacause the Debtor filed its chapter 11
bankruptcy case in response to an imminent foreclosure by OneWest
on real property located at 1251 N. Clark Street, Los Angeles,
Calif. The Debtor filed an earlier Chapter 11 case on March 9,
2012, which was dismissed on March 22. However, the Debtor's list
of 20 largest unsecured creditors in the current case contains
none of the creditors listed on the 20 largest unsecured creditor
list in the first case.
Lewis R. Landau, Esq., at Dykema Gossett LLP, informed the Court
that OneWest is investigating the facts and circumstances
surrounding the Debtor's acquisition of its seven real properties
because the facts disclosed in the Debtor's schedules and U.S.
Trustee filings simply cannot be reconciled. OneWest's borrower
is Elizabeth Medina, who transferred the Clark Property into the
Debtor on Dec. 29, 2011. Ms. Medina is the sister of Douglas
Reed, the Debtor's manager.
Mr. Landau alleged that:
-- the Debtor's filings provided to the U.S. Trustee reveal
numerous discrepancies;
-- the Debtor's case reflects many badges of a bad faith filing
involving multiple property transfers into the filing entity; and
-- the Debtor's estate's assets are materially underinsured.
About Hale Moku, LLC
Hale Moku, LLC, filed a Chapter 11 petition (Bankr. C.D. Calif.
Case No. 12-24357) on April 24, 2012. Hale Moku, a Los Angeles-
based property developer, disclosed $20.1 million in assets and
$14.9 million in liabilities in its schedules. The Debtor owns
seven single family residences in Venice and Los Angeles, valued
at an aggregate of $20.1 million. The properties serve as
collateral to $14.83 million in secured debt. Judge Vincent P.
Zurzolo presides over the case. Thomas C. Corcovelos, Esq., at
Corcovelos & Forry LLP, in Manhattan Beach, California, serves as
counsel.
Hale Moku LLC first filed a bankruptcy petition, pro se (Bankr.
C.D. Calif. Case No. 12-18574) on March 9, 2012.
H&M OIL: Wants to Hire Lain Faulkner as Financial Advisors
----------------------------------------------------------
H&M Oil and Gas, LLC, and Anglo-American Petroleum Corporation ask
the U.S. Bankruptcy Court for the Northern District of Texas for
permission to employ Lain, Faulkner & Co., P.C., as financial
advisors.
Lain, Faulkner will provide, among other things, assistance with
the preparation of the Debtor's schedules of assets and
liabilities, the Debtor's statement of financial affairs; and
monthly operating reports.
Jason A. Rae, a member of Lain Faulkner, assures the Court that
the firm is "disinterested person" as that term is defined in
Section 101(14) of the Bankruptcy Code.
About H&M Oil
H&M Oil & Gas, LLC, filed a bare-bones Chapter 11 petition
(Bankr. N.D. Tex. Case No. 12-32785) in its hometown Dallas on
April 30, 2012. Another entity, Anglo-American Petroleum Corp.
(Case No. 12-32786) simultaneously filed for Chapter 11.
Each of the Debtors estimated assets and debts of $50 million to
$100 million.
H&M Oil & Gas is an oil and gas production and development
company. H&M, through its operating company, H&M Resources LLC,
is focused on developing its leases in the Permian basin and Texas
panhandle. Dallas, Texas-based Anglo-American Petroleum --
http://www.angloamericanpetroleum.com/-- is the holding
corporation for H&M Oil.
Judge Barbara J. Houser presides over the case. The Debtors are
represented by Keith William Harvey, Esq., at Anderson Tobin PLLC,
in Dallas.
Prospect Capital Corporation, the Debtors' lone secured creditor,
is represented in the case by Timothy A. Davidson II, Esq., and
Joseph P. Rovira, Esq., at Andrews Kurth LLP.
HAWKER BEECHCRAFT: Gets Final OK to Incur $400MM Delayed Draw Loan
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York,
in a final order, authorized Hawker Beechcraft Inc., and its
debtor-affiliates, to:
a) borrow up to a maximum principal amount of $400 million
under the Delayed Draw Facility, a portion of which may be
applied to provide cash collateral for the issuance of
Letters of Credit;
b) use the proceeds of the DIP Facility and the Cash Collateral
in the operation of the Debtors' businesses, to make the
Senior Tranche Repayment and to cash collateralize the
Letters of Credit until Dec. 15, 2012.
The Debtors would use the cash collateral for working capital and
financing to carry on the operation of their businesses.
As adequate protection from any diminution value of the lender's
collateral, the Debtor will grant the lender replacement liens and
superpriority administrative expense claim status, subject to
certain carve out on expenses.
Additionally, the DIP Agent, at the direction of the Required DIP
Lenders, will have the unqualified right to credit bid up to the
full amount of the outstanding DIP Obligations in any sale of any
DIP Collateral under or pursuant to (i) Section 363 of the
Bankruptcy Code; (ii) a plan of reorganization or a plan of
liquidation under Section 1129 of the Bankruptcy Code; or (iii) a
sale or disposition by a chapter 7 trustee for any Debtor under
section 725 of the Bankruptcy Code.
About Hawker Beechcraft
Hawker Beechcraft Inc., a designer and manufacturer of light and
medium-sized jet, turboprop and piston aircraft, filed for Chapter
11 reorganization together with 17 affiliates (Bankr. S.D.N.Y.
Lead Case No. 12-11873) on May 3, 2012, having already negotiated
a plan that eliminates $2.5 billion in debt and $125 million of
annual cash interest expense.
The plan, to be filed by June 30, will give 81.9% of the new stock
to holders of $1.83 billion of secured debt, while 18.9% of the
new shares are for unsecured creditors. The proposal has support
from 68% of secured creditors and holders of 72.5% of the senior
unsecured notes.
Hawker is 49%-owned by affiliates of Goldman Sachs Group Inc. and
49%-owned by Onex Corp. The Company's balance sheet at Dec. 31,
2011, showed $2.77 billion in total assets, $3.73 billion in total
liabilities and a $956.90 million total deficit. Other claims
include pensions underfunded by $493 million.
Hawker's legal representative is Kirkland & Ellis LLP, its
financial advisor is Perella Weinberg Partners LP and its
restructuring advisor is Alvarez & Marsal. Epiq Bankruptcy
Solutions LLC is the claims and notice agent.
Sidley Austin LLP serves as legal counsel and Houlihan Lokey
Howard & Zukin Capital Inc. serves as financial advisor to the DIP
Agent and the Prepetition Agent.
Wachtell, Lipton, Rosen & Katz represents an ad hoc committee of
senior secured prepetition lenders holding 70% of the loans.
Milbank, Tweed, Hadley & McCloy LLP represents an ad hoc committee
of holders of the 8.500% Senior Fixed Rate Notes due 2015 and
8.875%/9.625% Senior PIK Election Notes due 2015 issued by Hawker
Beechcraft Acquisition Company LLC and Hawker Beechcraft Notes
Company. The members of the Ad Hoc Committee -- GSO Capital
Partners, L.P. and Tennenbaum Capital Partners, LLC -- hold claims
or manage accounts that hold claims against the Debtors' estates
arising from the purchase of the Senior Notes. Deutsche Bank
National Trust Company, the indenture trustee for senior fixed
rate notes and the senior PIK-election notes, is represented by
Foley & Lardner LLP.
An Official Committee of Unsecured Creditors appointed in the case
has selected Daniel H. Golden, Esq., and the law firm of Akin Gump
Strauss Hauer & Feld LLP as legal counsel.
HEALTHCARE OF FLORENCE: E&M Wants Cash Collateral Use Prohibited
----------------------------------------------------------------
Creditor E&M Hospital Investments, LLC, filed with the U.S.
Bankruptcy Court for the District of Arizona:
-- a non-consent to Healthcare of Florence, LLC's use of cash
collateral;
-- its objection to the Debtor's first day motions;
-- its objection to motion for interim and final order
approving postpetition financing, etc; and
-- its objection to motion to approve landlord's waiver,
consent, subordination and guaranty. E&M holds a first
priority secured lien, (or ownership) on all prepetition
accounts receivable generated by Florence Hospital, LLC.
E&M is owed $2,602,577 (not including legal fees and costs), with
collateral of a value of around $3,175,000.
E&M tells the Court that it has not consented to use of cash
collateral and does not consent to use of cash collateral.
E&M objects to the Debtor's first day motions to the extent that
the Debtor seeks to use any of E&M's cash collateral to fund such
deposits or payments.
Additionally, E&M provides notice to the Court and all parties
that it has not executed any Intercreditor Agreement with the
proposed debtor-in-possession financing source, SCM Special
Finance Opportunities Source, LLP. Such an Intercreditor
Agreement is a stated precondition to the proposed DIP Financing.
The proposed drafts presented to E&M by SCM, so far, include a
number of objectionable waivers and conditions requested by SCM
and the Debtor.
About Healthcare of Florence
Healthcare of Florence, LLC, filed a bare-bones Chapter 11
petition (Bankr. D. Ariz. Case No. 12-08547) in Tucson, Arizona,
on April 23, 2012. Healthcare of Florence, LLC --
http://www.florencecommunityhealthcare.com-- owns and operates a
full-service community hospital in Florence, Arizona. The Debtor
disclosed $42.2 million in assets and $39.0 million in liabilities
as of the Chapter 11 filing.
Judge James M. Marlar presides over the case. James F. Kahn P.C.
serves as the Debtor's counsel. The petition was signed by Edward
McEachern, CEO of Initiatives Healthcare, LLC, manager of debtor.
HEART HOUSE: Case Summary & 6 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Heart House Ministries, Inc.
dba The River
796 Hook Street
Clermont, FL 34711
Bankruptcy Case No.: 12-08066
Chapter 11 Petition Date: June 13, 2012
Court: U.S. Bankruptcy Court
Middle District of Florida (Orlando)
Debtor's Counsel: James H. Monroe, Esq.
JAMES H. MONROE, P.A.
P.O. Box 540163
Orlando, FL 32854
Tel: (407) 872-7447
Fax: (407) 246-0008
E-mail: jhm@jamesmonroepa.com
Scheduled Assets: $3,290,132
Scheduled Liabilities: $2,195,141
A copy of the Company's list of its six largest unsecured
creditors filed with the petition is available for free at:
http://bankrupt.com/misc/flmb12-08066.pdf
The petition was signed by Clay D. Hartzog, Sr., president.
HEARTHSTONE HOMES: Court OKs Prudential as Listing Agent
--------------------------------------------------------
Randel Lewis, the Chapter 11 Trustee of Hearthstone Homes, Inc.,
sought and obtained approval from the U.S. Bankruptcy Court to
employ Prudential Ambassador Real Estate Company, Omaha, Nebraska
as listing agent to sell the house owned by the Debtor at 8039 N.
147th Street, in Bennington, Nebraska.
Prudential Ambassador will be paid a commission of 5.25% of the
sale price.
The Chapter 11 Trustee attests that Prudential Ambassador is a
"disinterested person" as the term is defined in Section 101(14)
of the Bankruptcy Code.
About Hearthstone Homes
Hearthstone Homes, Inc., filed a Chapter 11 petition in Omaha,
Nebraska (Bankr. D. Neb. Case No. 12-80348) on Feb. 24, 2012.
ketv.com reported that Hearthstone Homes filed for Chapter 11
bankruptcy protection after a deal to sell the company fell
through. Hearthstone Homes' principal business activities have
been the purchase, development and sale of residential real
property for 40 years.
Chief Judge Thomas L. Saladino presides over the case. The Debtor
is represented by Robert F. Craig, P.C. Hearthstone estimated
assets and debts of $10 million to $50 million as of the Chapter
11 filing.
Wells Fargo N.A., the primary lender, is represented by lawyers at
Croker Huck Kasher DeWitt Anderson & Gonderinger LLC.
Nancy J. Gargula, the U.S. Trustee for Region 13, appointed seven
unsecured creditors to serve on the Official Committee of
Unsecured Creditors of Hearthstone Homes.
HEARTHSTONE HOMES: Court OKs Jack Nitz & Associates as Auctioneers
------------------------------------------------------------------
Randel Lewis, the Chapter 11 Trustee of Hearthstone Homes, Inc.,
sought and obtained approval from the U.S. Bankruptcy Court to
employ Jack Nitz & Associates Auctioneers as sales agent and
auctioneer of substantially all of the Debtor's personal property
pursuant to 11 U.S.C. Sec. 327(a), nunc pro tunc to April 9, 2012
Jay Nitz, President and Chief Executive Officer of Nitz
Auctioneers, attests that the firm is a "disinterested person" as
the term is defined in Section 101(14) of the Bankruptcy Code.
About Hearthstone Homes
Hearthstone Homes, Inc., filed a Chapter 11 petition in Omaha,
Nebraska (Bankr. D. Neb. Case No. 12-80348) on Feb. 24, 2012.
ketv.com reported that Hearthstone Homes filed for Chapter 11
bankruptcy protection after a deal to sell the company fell
through. Hearthstone Homes' principal business activities have
been the purchase, development and sale of residential real
property for 40 years.
Chief Judge Thomas L. Saladino presides over the case. The Debtor
is represented by Robert F. Craig, P.C. Hearthstone estimated
assets and debts of $10 million to $50 million as of the Chapter
11 filing.
Wells Fargo N.A., the primary lender, is represented by lawyers at
Croker Huck Kasher DeWitt Anderson & Gonderinger LLC.
Nancy J. Gargula, the U.S. Trustee for Region 13, appointed seven
unsecured creditors to serve on the Official Committee of
Unsecured Creditors of Hearthstone Homes.
HEMCON MEDICAL: Has Until July 2 to Propose Chapter 11 Plan
-----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Oregon ordered that
HemCon Medical Technologies Inc. has until July 2, 2012, to file a
Chapter 11 Plan and an explanatory Disclosure Statement.
Portland, Oregon-based HemCon Medical Technologies Inc., fdba
HemCon, Inc. filed a Chapter 11 bankruptcy petition (Bankr. D.
Ore. Case No. 12-32652) on April 10, 2012, estimating up to
$50 million in assets and liabilities. Founded in 2001, HemCon --
http://www.hemcon.com/-- is a diversified medical technology
company that develops, manufactures and markets innovative wound
care, anti-microbial and oral care products for the military,
emergency medical, surgical, dental and over-the-counter markets.
HemCon has subsidiaries in the United Kingdom and Europe.
The bankruptcy filing comes after an en banc decision by the U.S.
Court of Appeals for the Federal Circuit on March 15, 2012, which
affirmed an award of $34.2 million in damages to Marine Polymer
Technologies Inc. in a patent infringement case initiated in 2006.
HemCon's European subsidiary is not subject to the Chapter 11
proceedings.
Judge Elizabeth L. Perris presides over the case. Attorneys at
Tonkon Torp LLP represent the Debtor. The petition was signed by
Nick Hart, CFO.
Robert D. Miller Jr., U.S. Trustee for Region 18 appointed three
unsecured creditors to serve on the Official Committee of
Unsecured Creditors of HemCon Medical Technologies, Inc.
HORIZON LINES: Moody's Affirms 'Caa2' CFR/PDR; Outlook Stable
-------------------------------------------------------------
Moody's Investors Service affirmed Horizon Lines, Inc.'s Corporate
Family Rating (CFR) and Probability of Default Rating ("PDR") at
Caa2 and removed the LD ("Limited Default") designation from the
rating in recognition of the conversion to equity of the $228
million of Series A and Series B Convertible Senior Secured notes
due in October 2017 ("Notes"). The Notes were issued on October 5,
2011 upon the execution of an exchange offer for the company's
$330 million aggregate principal amount of 4.25% Convertible
Senior Notes due 2012 as part of a financial restructuring.
Moody's considers the conversion of the Notes to equity as a
default on these instruments since the conversion took place even
though the price of the company's common stock did not meet the
indentures' thresholds for conversion. The conversion of the Notes
resulted in losses to the holders since they received equity
valued below the minimum value required by the indentures.
Moody's also lowered its ratings on the company's first lien
senior secured notes and second lien senior secured notes, each
due 2016, to B3 from B2 and to Caa3 from Caa2, respectively. These
downgrades result from the removal of the large first loss
position the Notes provided in the Loss Given Default waterfall.
In addition, Moody's lowered the Speculative Grade Liquidity
Rating to SGL-4 from SGL-3. The outlook is stable.
Ratings Rationale
The affirmation of the Corporate Family and Probability of Default
ratings considers that total debt has been reduced by the
conversion of the Notes, but also recognizes the significant
operating challenges that the company continues to face. The
ratings anticipate no meaningful improvement in demand for the
company's services into 2013 because of challenging U.S. macro-
economic conditions. Most credit metrics remain indicative of the
Caa rating category. Horizon maintains leading positions in its
core Jones Act markets and provides a key link in its customers'
distribution chains and the geographic regions it serves. However,
earnings and cash flows remain exposed to the economic cycle and
could face increasing pressure in upcoming quarters as economic
growth remains muted. Post-conversion Debt to EBITDA improves to
about the mid-six times range and EBIT to Interest coverage
remains well below one time. Additionally, the pay-in-kind 15%
interest on the $140 million of second lien notes will lead to
higher debt balances over time. Moody's also expects weak
liquidity in upcoming quarters.
The lowering of the Speculative Grade Liquidity rating to SGL-4
considers increasing reliance on the $100 million revolving credit
at a time when the full facility amount is not available to
Horizon because of a too small borrowing base, the narrow cushion
relative to the springing fixed charge coverage covenant of the
revolving credit agreement, anticipated negative free cash flow
generation in 2012, and the ongoing burden of payments on
previously agreed settlements of various legacy legal claims
related to the company's Puerto Rico trade lane and related to the
shut-down of its FSX service.
The stable outlook considers the current weak liquidity profile.
The ratings could be upgraded if Horizon is able to generate
sufficient operating cash flow to alleviate reliance on the
revolving credit facility and meet capital spending and legal
settlement payments. Maintaining Debt to EBITDA at or below 6.0
times, FFO + Interest to Interest above 2.2 times, annual free
cash flow of at least $25 million and an EBIT margin of at least
4.0% after improving its liquidity profile would also support an
upgrade of the ratings. The inability to reverse the negative
earnings and negative free cash flow generation that has plagued
the company while it operated its FSX service would exert
downwards pressure on the ratings. Debt to EBITDA that is
sustained above 8.5 times or FFO + Interest to Interest below 1.2
times could lead to a downgrade of the ratings.
The principal methodology used in rating Horizon was the Global
Shipping Industry Methodology published in December 2009. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
Horizon Lines, Inc. based in Charlotte, North Carolina, through
its wholly-owned indirect operating subsidiary, Horizon Lines,
LLC, currently operates 11 of its 15 Jones Act qualified U.S. flag
container ships in Jones Act liner services between the
continental United States and either Alaska, Hawaii, or Puerto
Rico.
HORIZON VILLAGE: Wins Extension of Exclusive Solicitation Period
----------------------------------------------------------------
The Bankruptcy Court extended Horizon Village Square LLC's
exclusive period to solicit acceptance of its Amended Plan of
Reorganization through the 15th day after the Court enters its
order on confirmation of the Plan. The Debtor's counsel, Gordon
Silver, prepared and submitted the order. Wells Fargo Bank, N.A.,
through its counsel Bryan Cave and Lewis and Roca, approved of the
order.
Wells Fargo Bank, N.A., has objected to the request, arguing that
the Debtor has failed to establish cause to extend the exclusive
period to obtain acceptance of its Plan. The Debtor's creditors
have already voted to accept or reject the Plan, and plan
confirmation proceedings have concluded. To the extent another
party wishes to seek confirmation of a plan, Wells Fargo said it
now should be free to do so.
Wells Fargo, as successor-by-merger to Wachovia Bank, National
Association, made a $11,350,000 prepetition loan to the Debtor,
secured by, among other things, a first position lien on (i) the
Debtor's retail shopping center located at 25 through 75 East
Horizon Ridge Parkway in Henderson, Nevada; and (ii) all rents and
other personal property in any way related to the Property. The
Debtor is in default of its obligations under the Loan by, among
other things, failing to repay the Loan when it matured on Feb.
13, 2011. Wells Fargo filed its proof of claim on Nov. 15, 2011,
establishing that the Debtor owed no less than $11,225,639 as of
the Petition Date, plus accrued and accruing interest, fees and
costs, and post-petition interest.
On Oct. 25, 2011, the Debtor filed a plan and an errata contending
that Wells Fargo is fully secured by its collateral in the Chapter
11 case. The Debtor filed its Disclosure Statement on Nov. 16,
2011.
Wells Fargo called the Debtor's Plan a "kick the can down the
road" approach that assumes the Debtor will be able to refinance
its debt or sell Wells Fargo's collateral and pay the then-due
balance in full within five years.
Wells Fargo sought relief from the automatic stay so that the
Court could "test" the Plan at the confirmation hearing and decide
whether the Debtor has met its burden of proof under Section 1129
of the Bankruptcy Code, or whether the Court should grant stay
relief.
The Court held a consolidated evidentiary hearing on plan
confirmation and stay relief on Jan. 9, 10, and 12, 2012. The
parties have filed post-trial briefs.
About Beltway One, Horizon Village Square,
Nigro HQ & Ten Saints
Four related Las Vegas, Nevada-based entities sought Chapter 11
bankruptcy protection on July 13, 2011. The businesses are owned
or managed by local business people and firms, including Todd
Nigro, Nigro Development LLC, a Nigro family trust and other
investors.
Horizon Village Square LLC (Bankr. D. Nev. Case No. 11-21034) owns
the Vons-anchored Horizon Village Square Shopping Center near
I-515 and Horizon Drive in Henderson. The property includes five
retail buildings with nearly 43,000 square feet of space.
Ten Saints LLC (Bankr. D. Nev. Case No. 11-21028) owns the 134-
room Hampton Inn & Suites at St. Rose Parkway and Seven Hills
Drive in Henderson.
Beltway One Development Group LLC (Bankr. D. Nev. Case No.
11-21026) owns the Desert Canyon Business Park at Russell Road and
the Las Vegas Beltway. It has two buildings and 15 acres.
Nigro HQ LLC (Bankr. D. Nev. Case No. 11-21014) owns an office
building at 9115 W. Russell Road occupied by Bank of George,
Infinity Plus LLC and Nigro Construction Inc.
Todd Nigro said the four bankruptcies were caused by threatened
foreclosures -- typically related to Wells Fargo Bank demanding
payments to keep loan-to-value ratios at specified levels.
Judge Mike K. Nakagawa presides over the cases. Lawyers at Gordon
Silver serve as the Debtors' bankruptcy counsel. The bankruptcy
petitions estimated assets and debts from $1 million to $10
million each for Nigro HQ; and from $10 million to $50 million in
both assets and debts for Horizon Village, Ten Saints and Beltway
One. The cases are not jointly administered.
A fifth related business, Russell Boulder LLC, filed for
bankruptcy (Bankr. D. Nev. Case No. 10-29724) on Oct. 19, 2010.
It owns the 600-suite Siena Suites extended stay property at
Boulder Highway and Russell Road.
Wells Fargo Bank N.A. is represented in the case by Robert J.
Miller, Esq., and Bryce A. Suzuki, Esq., at Bryan Cave LLP; and
Robert M. Charles, Jr., Esq., and Michael Lynch, Esq., at Lewis
and Roca LLP. Branch Bank & Trust is represented by lawyers at
Holland & Hart led by Lars Evensen, Esq.
HOUGHTON MIFFLIN: Hearing on Case Venue Transfer Set for June 18
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
will convene a hearing on June 18, 2012, at 9:45 a.m., to consider
the U.S. Trustee's motion for transfer of venue for the Chapter 11
case of Houghton Mifflin Harcourt Publishing Company, et al.
Objections, if any, are due June 11.
As reported in the Troubled Company Reporter on June 7, 2012, Bill
Rochelle, the bankruptcy columnist for Bloomberg News, reported
that the bankruptcy judge denied a request by the U.S. Trustee for
a quick hearing on its request to move the Debtor's case from
Manhattan to Boston, where the company is based.
U.S. Trustee Tracy Hope Davis argued that Houghton Mifflin, "one
of Boston's largest employers," should reorganize in
Massachusetts, where its headquarters is located. Given that the
prepackaged Chapter 11 could be finished at a June 21 confirmation
hearing, the U.S. Trustee is asking the bankruptcy judge in New
York to hold a hearing quickly on the motion to transfer venue.
According to the report, the day after the U.S. Trustee filed her
papers, U.S. Bankruptcy Judge Robert E. Gerber denied the motion
for a quick hearing, saying the question is "too important" to
afford creditors less than the usual time for response. The
schedule that Judge Gerber set down means there's a possibility,
if not likelihood, that the venue motion won't be heard until
after the plan is confirmed June 21.
About Houghton Mifflin
Houghton Mifflin Harcourt Publishers Inc., headquartered in
Boston, Massachusetts, is one of the three largest U.S. education
publishers focusing on the K-12 market with roughly $1.3 billion
of revenue for fiscal year ended December 2011.
Houghton Mifflin Harcourt and its affiliates filed a prepackaged
Chapter 11 reorganization (Bankr. S.D.N.Y. Lead Case No. 12-12171)
on May 21, 2012.
Paul, Weiss, Rifkind, Wharton & Garrison LLP has been tapped as
bankruptcy counsel. Blackstone Advisory Services, LP, is the
financial advisor. Kurtzman Carson Consultants LLC is the claims
and notice agent.
The Debtor disclosed assets of $2.68 billion and debt totaling
$3.535 billion as of the Chapter 11 filing.
HUMPUSS SEA: U.S. Bankruptcy Court Recognizes Singapore Proceeding
------------------------------------------------------------------
The Hon. Shelley C. Chapman of the U.S. Bankruptcy Court for the
Southern District of New York, upon the verified petition for
recognition and Chapter 15 relief of Cosimo Borrelli and Jason
Aleksander Kardachi, in their capacity as joint and several
liquidators of Humpuss Sea Transport PTE LTD, granted recognition
of HST's winding up proceedings pending before the High Court of
the Republic of Singapore as a foreign main proceeding pursuant to
Sections 1515 and 1517 of the Bankruptcy Code.
About Humpuss Sea Transport
Humpuss Sea Transport PTE LTD is a company based in Singapore that
operated a fleet of oil tanker ships and provides charter services
in the shipping industry. It stopped shipping at the end of 2009.
The joint liquidators are seeking U.S. court recognition of the
winding up proceeding initiated in the High Court of the Republic
of Singapore.
Jason Aleksander Kardachi and Cosimo Borrell at Borrelli Wash, as
joint liquidators, petitioned for Chapter 15 proceeding for
Humpuss Sea Transport PTE LTD (Bankr. S.D. N.Y. Case No. 12-11086)
on March 19, 2012.
Bankruptcy Judge Shelley C. Chapman presides over the case. The
Debtor estimated assets and debts at $100 million to $500 million.
The petitioners are represented by Curtis C. Mechling, Esq.,
Atstroock & Stroock & Lavan, LLP.
HUSSEY COPPER: Disclosure Statement Hearing on June 26
------------------------------------------------------
Hussey Copper Corp., et al., submitted to the U.S. Bankruptcy
Court for the District of Delaware a Disclosure Statement
explaining the proposed Chapter 11 Plan.
The bankruptcy judge will convene a hearing to consider the
adequacy of the information in the Disclosure Statement on
June 26, 2012 at 1:00 p.m. The hearing was originally scheduled
for June 19.
The Debtors will begin soliciting votes on the Plan following
approval of the adequacy of the information in the Disclosure
Statement.
According to the Disclosure Statement, the Plan provides for the
liquidation of the Debtors' remaining assets, winding down of the
Liquidating Debtors' estates; and reorganization of the
reorganization of the Reorganizing Debtors.
Under the Plan, secured creditors will receive cash equal to 100%
of the allowed claim, release of collateral securing allowed claim
or other agreed-upon treatment.
General Unsecured Creditors will receive cash on initial,
subsequent and final distribution dates. Holders of general
unsecured claims against OAP and Orbie will recover 100% of their
claims. The Disclosure Statement leaves blanks as to the
estimated recovery by holders of unsecured claims against the
other Debtors.
Interests against most of the Debtors will be terminated.
Interests in OAP and Orbie will be retained.
A full-text copy of the Disclosure Statement is available for free
at http://bankrupt.com/misc/HUSSEY_COPPER_ds.pdf
About Hussey Copper
Hussey Copper Corp., based in Leetsdale, Pennsylvania, is one of
the leading manufacturers of copper products in the United States.
Hussey Copper was founded in Pittsburgh in 1848. The Company and
its affiliates, which operate one manufacturing facility in
Leetsdale and two facilities in Eminence, Kentucky, manufacture "a
wide range of value-added copper products and copper-nickel
products. The Company has more than 500 full-time employees.
Hussey Copper Corp. filed a Chapter 11 petition (Bankr D. Del.
Case No. 11-13010) on Sept. 27, 2011, with a deal to sell
substantially all assets. Five other affiliates also filed
separate petitions (Case Nos. 11-13012 to 11-13016). Hussey
Copper Ltd. estimated $100 million to $500 million in assets and
debts. Hussey Copper Corp. estimated up to $50,000 in assets and
up to $100 million in debts.
Mark Minuti, Esq., at Saul Ewing LLP, serves as counsel to the
Debtors. Donlin Recano & Company Inc. is the claims and notice
agent. The Debtors tapped Winter Harbor, LLC in substitution for
Huron Consulting Services LLC.
An official creditors' committee has been appointed in the case.
The panel selected Lowenstein Sandler PC as counsel. The panel
selected FTI Consulting, Inc. as restructuring and financial
advisor.
The stalking horse bidder, KHC Acquisitions LLC, a unit of Kataman
Metals LLC, is represented in the case by David D. Watson, Esq.,
and Scott Opincar, Esq., at McDonald Hopkins LLC, in Cleveland.
Counsel to PNC Bank NA, as lender, issuer and agent for the
Debtors' secured lenders, are Lawrence F. Flick II, Esq., Blank
Rome LLP, in New York, and, Regina Stango Kelbon, Esq., at Blank
Rome LLP, in Wilmington.
US private equity firm Patriarch Partners officially acquired
Hussey Copper on Dec. 16, 2011. The buyout firm of distressed
debt mogul Lynn Tilton acquired Hussey Copper for $107.8 million
after a nine-hour, 34-round auction.
Bankruptcy Judge Brendan L. Shannon approved the name change of
Hussey Copper Corp. et al., to HCL Liquidation Ltd.
INDIGO-ENERGY: Stanley Teeple Resigns as Director and CFO
---------------------------------------------------------
Stanley L. Teeple gave Indigo-Energy, Inc., a notice that he was
resigning from the Company's Board of Directors and as Chief
Financial Officer for personal reasons. Mr. Teeple indicated that
he had no disagreements with the Company's policies or practices.
About Indigo-Energy
Henderson, Nev.-based Indigo-Energy, Inc., is an independent
energy company, currently engaged in the exploration of natural
gas and oil.
The Company's balance sheet at Sept. 30, 2010, showed
$5.05 million in total assets, $11.35 million in total
liabilities, and a stockholders' deficit of $6.30 million.
Mark Bailey & Company, Ltd., in Reno, Nevada, expressed
substantial doubt about Indigo-Energy's ability to continue as a
going concern, following the Company's 2009 results. The
independent auditors noted that the Company has suffered recurring
losses from operations and has a net capital deficiency.
Indigo-Energy previously notified the U.S. Securities and
Exchange Commission that it could not file its annual report on
Form 10-K for the fiscal year ended Dec. 31, 2010, within the time
prescribed. On April 14, 2011, the Company informed the SEC that
it was unable to file its annual report within the extension
period due to financial constraints that prohibit the Company from
completing that Report.
INTERNATIONAL LEASE: Moody's Lifts CFR to 'Ba3'; Outlook Stable
---------------------------------------------------------------
Moody's Investors Service upgraded the corporate family and senior
unsecured ratings of International Lease Finance Corporation
(ILFC) to Ba3 from B1 and revised the rating outlook to stable.
The debt ratings of Delos Aircraft Inc., Flying Fortress Inc.,
ILFC E-Capital Trust I, and ILFC E-Capital Trust II were similarly
upgraded by one notch and the rating outlooks revised to stable.
Ratings Rationale
The upgrade of ILFC's rating is based on the progress the company
has made in recent quarters to enhance its liquidity and capital
positions, thereby improving its financial flexibility and
reducing risks to its franchise. ILFC's rating continues to be
constrained by profitability that is lower than aircraft leasing
company peers, as well as by unstable economic conditions in
Europe that represent a challenge to the firm's efforts to improve
margins.
ILFC strengthened its liquidity by extending debt maturities,
diversifying its funding and lengthening its liquidity runway.
ILFC issued $4.5 billion of unsecured debt in the twelve months
ending March 31, 2012, demonstrating improved access to funding
that doesn't encumber the firm's assets. Longer loan terms
extended the weighted average maturity of ILFC's debt to 6.5 years
at March 31, 2012, up from 4.3 years at the end of 2008. At the
end of the first quarter, ILFC had $2.3 billion of unrestricted
cash and a $2 billion unused committed line of credit that,
combined with operating cash flow, provide strong coverage of debt
maturities over the next 24 months, in line with company targets.
In Moody's view, ILFC's liquidity and liability management actions
have materially reduced its intermediate term liquidity risks.
"Going forward, a ramp up of aircraft deliveries under ILFC's
purchase agreements will place additional demands on the firm's
liquidity," said Moody's senior analyst Mark Wasden. "But the
firm's pipeline is largely comprised of new technology aircraft
that we believe will be more easily financed than older aircraft."
ILFC also reduced leverage, strengthening its capital cushion to
absorb potential asset quality and operating performance
weaknesses. Moody's anticipates further modest deleveraging in the
near term, though in the longer term debt-funded growth could
pressure the company's leverage measures. Moody's believes that
ILFC must demonstrate that it can maintain an improved leverage
profile while also generating a return on equity that is
attractive to investors.
Moody's expects that ILFC's profitability will eventually improve
as it takes delivery of new aircraft that command premium lease
rates. Management efforts to sell or part out less profitable
portfolio aircraft and refinance higher cost debt will also
benefit earnings. However, current conditions suggest that near-
term improvement in ILFC's profitability metrics could be slow to
develop, which is a constraint on the firm's rating and outlook.
"ILFC faces challenges improving its profitability to a level that
is commensurate with its franchise strengths," said Wasden. " A
key concern relates to the effect of weaker European economic
conditions on air travel volumes, aircraft demand and lease rates,
and airline credit quality." ILFC earned 44% of its revenues from
European carriers in 2011, a relatively high percentage for the
sector. Fuel price volatility and higher new aircraft production
rates could add to pressure on lease rates in a weaker economy.
ILFC's higher trending average effective cost of borrowing is also
an earnings challenge, though lower debt levels partially offset
the effect of this on the firm's lease margin.
ILFC's rating continues to be supported by its position as an
industry leader in aircraft finance, its fleet of relatively
recent vintage, widely utilized aircraft, and its diverse global
customer relationships.
Moody's could upgrade ILFC's ratings if the firm steadily improves
profitability to a level more comparable with close peers, while
also maintaining strong capital discipline.
In its last rating action on April 5, 2012, Moody's assigned a Ba3
rating to a $550 million term loan issued by ILFC subsidiary Delos
Aircraft Inc.
International Lease Finance Corporation, headquartered in Los
Angeles, California, is a major owner-lessor of commercial
aircraft.
The principal methodology used in this rating was the Finance
Company Global Rating Methodology published March 2012.
Ratings affected by the action include:
International Lease Finance Corporation:
Corporate Family: to Ba3 from B1
Senior unsecured: to Ba3 from B1
Senior secured: to Ba2 from Ba3
Preferred stock: to B2 from B3
Delos Aircraft Inc.:
Senior secured: to Ba2 from Ba3
Flying Fortress Inc.:
Senior secured: to Ba2 from Ba3
ILFC E-Capital Trusts I and II:
Preferred Stock: to B2 from B3
KEOWEE FALLS: Files Amended Schedules of Assets & Liabilities
-------------------------------------------------------------
Keowee Falls Investment Group LLC filed with the U.S. Bankruptcy
Court an amendment to its schedules of assets and liabilities.
Keowee Falls said it owns a real property at 380 Cliffs Parkway in
Salem, South Carolina. The property is valued at $1.35 million
and secures a $1.35 million claim by First South Bank in
Greenville.
The Debtor also owns platted lots and raw land in various
locations including Emerald Bay, Falls Creek, High Ridge, Jasmine
Cove, Laurel Point, Retreat, Towne Landing, valued at $30.8
million. The lots and raw land secure $17.9 million in claims by
Worthington Hyde in Johnson City.
The Debtor also owns machinery, a gatehouse building and lot, and
certain receivables valued in the aggregate at $549,797.
The Debtor said it owes $75,627 in taxes and other obligations to
the IRS and various state agencies, and $484,604 in unsecured
nonpriority obligations to various creditors.
About Keowee Falls Investment Group
Travelers Rest, South Carolina-based Keowee Falls Investment
Group, LLC, filed a Chapter 11 petition (Bankr. D. S.C. Case
No. 12-01399) in Spartanburg, South Carolina, on March 2, 2012.
Bankruptcy Judge John E. Waites presides over the case.
R. Geoffrey Levy, Esq., at Levy Law Firm, LLC assists the Debtor
in its restructuring effort. Keowee Falls estimated assets at
$100 million to $500 million and debts at $10 million to
$50 million.
The Cliffs Communities, Inc., owns 100% of the shares.
Units of The Cliffs Communities, led by The Cliffs Club &
Hospitality Group, Inc., doing business as The Cliffs Golf &
Country Club, along with 10 affiliates, sought Chapter 11
protection (Bankr. D. S.C. Lead Case No. 12-01220) on Feb. 28,
2012.
The Cliffs has eight premier, private master-planned residential
communities, each to have its own world-class golf course.
Approximately 3,734 lots have been sold. There are currently
1,385 finished homes, with 63 under construction. The properties
for sale are owned by non-debtor DevCo entities.
The Feb. 28 Debtors operate the exclusive membership clubs for
golf, tennis, wellness and social activities at The Cliffs'
communities in North and South Carolina. The clubs have 2,280
members, and there are 766 resigned members with refundable
deposits totaling $37 million. The Debtors do not own the golf
courses -- they only own or lease all the "core amenities" for the
operation of the golf courses.
KEY WEST: Case Summary & 7 Largest Unsecured Creditors
------------------------------------------------------
Debtor: Key West '07, L.L.C.
508 SW 12th Avenue
Deerfield Beach, FL 33442
Bankruptcy Case No.: 12-24468
Chapter 11 Petition Date: June 13, 2012
Court: U.S. Bankruptcy Court
Southern District of Florida (Fort Lauderdale)
Judge: John K. Olson
Debtor's Counsel: Donna A. Bumgardner, Esq.
BUMGARDNER & ASSOCIATES, P.A.
7707 N. University Drive, #103
Tamarac, FL 33321
Tel: (954) 724-4366
E-mail: donnabkclaw@aol.com
Scheduled Assets: $7,230,300
Scheduled Liabilities: $13,822,508
A copy of the Company's list of its seven largest unsecured
creditors filed with the petition is available for free at:
http://bankrupt.com/misc/flsb12-24468.pdf
The petition was signed by Richard S. Jones, Jr., member and
managing partner.
LEVI STRAUSS: Completes Tender Offer, Elects to Redeem Notes
------------------------------------------------------------
Levi Strauss & Co. has completed its tender offer for any and all
of its outstanding $350 million 8 7/8% Senior Notes due 2016.
A total of approximately $278.23 million (or 79.5%) of the $350
million aggregate principal amount of Notes were validly tendered
in the tender offer which expired at midnight, New York City time,
on May 21, 2012. These amounts include approximately $278.22
million of the Notes which were previously tendered by the early
tender deadline and which were accepted and paid for by the
Company. The payment date for accepted Notes tendered after the
early tender deadline but prior to the expiration of the tender
offer is Tuesday, May 22, 2012.
BofA Merrill Lynch acted as the Dealer Manager and Solicitation
Agent for the tender offer. Global Bondholder Services
Corporation served as the Information Agent and Depositary.
On May 22, 2012, the trustee for the Notes, at the direction of
the company, issued a notice of the redemption of all Notes that
remain outstanding after the completion of the tender offer. The
redemption date is May 25, 2012.
About Levi Strauss & Co.
Headquartered in San Francisco, California, Levi Strauss & Co. --
http://www.levistrauss.com/-- is one of the world's leading
branded apparel companies. The Company designs and markets jeans,
casual and dress pants, tops, jackets and related accessories, for
men, women and children under the Levi's(R), Dockers(R) and
Signature by Levi Strauss & Co.(TM). The Company markets its
products in three geographic regions: Americas, Europe, and Asia
Pacific.
The Company's balance sheet at Feb. 26, 2012, showed $3.21 billion
in total assets, $3.30 billion in total liabilities, $6.20 million
in temporary equity, and a $96.49 million total stockholders'
deficit.
* * *
In April 2012, Standard & Poor's Ratings Services assigned its
'B+' rating (same as the corporate credit rating) to San
Francisco-based Levi Strauss & Co.'s proposed $350 million senior
unsecured notes due 2022.
"The ratings on Levi Strauss reflect our view that the company's
financial profile continues to be 'aggressive,' particularly since
the company's balance sheet remains highly leveraged and we expect
cash flow protections measures to continue to be weak. In
addition, we continue to consider Levi Strauss' business risk
profile to be 'weak,' given its continuing participation in the
highly competitive denim and casual pants market, which is subject
to fashion risk and still-weak consumer spending, and our
expectation that the company's business focus will remain narrow.
We believe the company benefits from its strong, well-recognized
Levi's brand, long operating history, and distribution channel
diversity (both by retail customer and geography)," S&P said.
In April 2012, Moody's Investors Service affirmed Levi Strauss &
Co ("LS&Co) B1 Corporate Family and Probability of Default
Ratings. Moody's also assigned a B2 rating to the company's
proposed $350 million senior unsecured notes due 2022 and affirmed
the B2 ratings of the company's other series of unsecured debt.
Levi Strauss' B1 Corporate Family Rating reflects the company's
negative trends in operating margins reflecting inconsistent
execution as well as input cost pressures. The ratings also
reflect the company's still significant debt burden, which has
been increasing due to the company's continued investment in its
own retail stores and its sizable underfunded pension. Debt/EBITDA
(incorporating Moody's standard analytical adjustments) was 5.1
times for the LTM period ending 2/26/2012. The rating take into
consideration the company's significant global scale, with
revenues near $5 billion, its operations in over 110 countries and
the ownership of the iconic Levi's trademark.
LIBERATOR INC: Webb Replaces Gruber as Accountant
-------------------------------------------------
Liberator, Inc., terminated Gruber & Company, Inc., as its
principal independent registered public accounting firm. The
decision to terminate Gruber was approved by the Company's board
of directors.
The report of Gruber on the Company's financial statements for the
years ended June 30, 2010, and June 30, 2011, did not contain an
adverse opinion or disclaimer of opinion, nor was it modified as
to uncertainty, audit scope or accounting principles, other than
to state that there is substantial doubt as to the ability of the
Company to continue as a going concern.
During the years ended June 30, 2011, and 2010, and during the
subsequent period through to the date of Gruber's termination,
there were no disagreements between the Company and Gruber,
whether or not resolved, on any matter of accounting principles or
practices, financial statement disclosure, or auditing scope or
procedure, which, if not resolved to the satisfaction of Gruber,
would have caused Gruber to make reference thereto in its report
on the Company's audited financial statements.
Effective June 14, 2012, the Company engaged Webb & Company, P.A.,
as the Company's independent registered public accounting firm.
The engagement was approved by the Company's board of directors.
In connection with the Company's appointment of Webb as the
Company's principal registered accounting firm at this time, the
Company has not consulted Webb on any matter relating to the
application of accounting principles to a specific transaction,
either completed or contemplated, or the type of audit opinion
that might be rendered on the Company's financial statements.
Webb is located at 1500 Gateway Boulevard, Suite 202, Boynton
Beach, FL 33426.
About Liberator Inc.
Headquartered in Atlanta, Georgia, Liberator, Inc. is a provider
of goods and information to consumers who believe that sensual
pleasure and fulfillment are essential to a well-lived and healthy
life. The information that the Company provides consists
primarily of product demonstration videos that the Company shows
on its Web sites and instructional DVD's that the Company sells.
Gruber & Company, LLC, in Lake Saint Louis, Missouri, noted that
conditions exist which raise substantial doubt about the Company's
ability to continue as a going concern unless it is able to
generate sufficient cash flows to meet its financing requirements
and attain profitable operations.
The Company had a net loss of $801,252 for the year ended June 30,
2011, following a net loss of $1.03 million during the prior year.
The Company's balance sheet at March 31, 2012, showed $3.68
million in total assets, $4.55 million in total liabilities and a
$877,122 total stockholders' deficit.
LIGHTSQUARED INC: Alvarez & Marsal Approved as Financial Advisor
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
authorized LightSquared Inc., et al., to employ Alvarez & Marsal
North America, LLC as their financial advisor.
As reported in the Troubled Company Reporter on May 22, 2012, the
services that Moelis is to provide the Debtors (e.g., reviewing
and analyzing the Debtors' financial condition, reviewing and
analyzing potential strategic and capital structure alternatives,
advising the Debtors on tactics and strategies for negotiating
with stakeholders and assisting the Debtors in negotiating and
evaluating any capital transaction, sale transaction or
restructuring) are separate and distinct from the advisory
services that A&M will be providing the Debtors. To ensure that
there is no unnecessary duplication of services by either firm
during the pendency of these Chapter 11 cases, A&M will work
closely with Moelis to prevent any duplication of efforts in the
course of advising the Debtors.
A&M originally received $75,000 as a retainer in connection with
preparing for and conducting the filing of the Chapter 11 cases.
In the 90 days prior to the Petition Date, A&M received retainers
and estimated payments totaling $279,799 in the aggregate for
services performed for the Debtors. A&M has applied these funds to
actual amounts due for services rendered and expenses incurred
prior to the Petition Date. A precise disclosure of the amounts
or credits held, if any, as of the Petition Date will be provided
in A&M's first interim fee application for postpetition services
and expenses to be rendered or incurred for or on behalf of the
Debtors. The unapplied residual retainer, which is estimated to
total $81,694, will not be segregated by A&M in a separate
account, and will be held until the end of the Chapter 11 cases
and applied to A&M's finally approved fees in these proceedings.
A&M will be paid by the Debtors for the services of the A&M
Professionals at their customary hourly billing rates:
Managing Directors $625 - $850
Directors $425 - $650
Analysts/Associates/Consultants $250 - $450
A&M will be reimbursed for the reasonable out-of-pocket expenses.
The Debtors also will indemnify the firm.
Julie M. Hertzberg, Managing Director of Alvarez & Marsal North
America, LLC, is a "disinterested person" as that term is defined
in section 101(14) of the Bankruptcy Code.
About LightSquared
LightSquared Inc. and 19 of its affiliates filed Chapter 11
bankruptcy petitions (Bankr. S.D.N.Y. Lead Case No. 12-12080) on
May 14, 2012, as the Company seeks to resolve regulatory issues
that have prevented it from building its coast-to-coast integrated
satellite 4G wireless network.
LightSquared had invested more than $4 billion to deploy an
integrated satellite-terrestrial network. In February 2012,
however, the U.S. Federal Communications Commission told
LightSquared the agency would revoke a license to build out the
network as it would interfere with global positioning systems used
by the military and various industries. In March 2012, the
Company's partner, Sprint, canceled a master services agreement.
LightSquared's lenders deemed the termination of the Sprint
agreement would trigger cross-defaults under LightSquared's
prepetition credit agreements.
LightSquared and its prepetition lenders attempted to negotiate a
global restructuring that would provide LightSquared with
liquidity and runway necessary to resolve its issues with the FCC.
Despite working diligently and in good faith, however,
LightSquared and the lenders were not able to consummate a global
restructuring on terms acceptable to all interested parties,
prompting the bankruptcy filing.
As of the Petition Date, the Debtors employed roughly 168 people
in the United States and Canada. As of Feb. 29, 2012, the Debtors
had $4.48 billion in assets (book value) and $2.29 billion in
liabilities.
LightSquared also sought ancillary relief in Canada on behalf of
all of the Debtors, pursuant to the Companies' Creditors
Arrangement Act (Canada) R.S.C. 1985, c. C-36 as amended, in the
Ontario Superior Court of Justice (Commercial List) in Toronto,
Ontario, Canada. The purpose of the ancillary proceedings is to
request the Canadian Court to recognize the Chapter 11 cases as a
"foreign main proceeding" under the applicable provisions of the
CCAA to, among other things, protect the Debtors' assets and
operations in Canada. The Debtors named affiliate LightSquared LP
to act as the "foreign representative" on behalf of the Debtors'
estates.
Judge Shelley C. Chapman presides over the Chapter 11 case.
Lawyers at Milbank, Tweed, Hadley & McCloy LLP serve as counsel to
the Debtors. Kurtzman Carson Consultants LLC serves as claims and
notice agent.
Counsel to UBS AG as agent under the October 2010 facility is
Melissa S. Alwang, Esq., at Latham & Watkins LLP.
The ad hoc secured group of lenders under the Debtors' October
2010 facility was formed in April 2012 to negotiate an out-of-
court restructuring. The members are Appaloosa Management L.P.;
Capital Research and Management Company; Fortress Investment
Group; Knighthead Capital Management LLC; and Redwood Capital
Management. Counsel to the ad hoc secured group is Thomas E.
Lauria, Esq., at White & Case LLP.
Philip Falcone's Harbinger Capital Partners indirectly owns 96% of
LightSquared's outstanding common stock. Harbinger and certain of
its managed and affiliated funds and wholly owned subsidiaries,
including HGW US Holding Company, L.P., Blue Line DZM Corp., and
Harbinger Capital Partners SP, Inc., are represented in the case
by Stephen Karotkin, Esq., at Weil, Gotshal & Manges LLP.
LIGHTSQUARED INC: Fraser Milner Wins Court OK as Canadian Counsel
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
authorized LightSquared Inc., et al., to employ Fraser Milner
Casgrain LLP as Canadian counsel.
As reported in the Troubled Company Reporter on May 22, 2012, the
Debtors obtained an interim order permitting affiliate
LightSquared LP to act as the Foreign Representative on behalf of
the Debtors' estates in any judicial or other proceedings in a
foreign country, including in ancillary bankruptcy proceedings in
Canada. As a Foreign Representative, LSLP has the power to act in
any way permitted by applicable foreign law, including, but not
limited to, (a) seeking recognition of the Chapter 11 cases in the
Canadian Proceedings, (b) requesting that the Canadian Court lend
assistance to the Bankruptcy Court in protecting the property of
the Debtors' estates and (c) seeking any other appropriate relief
from the Canadian Court that LSLP deems just and proper in the
furtherance of the protection of the Debtors' estates.
Under the Interim Order, the Bankruptcy Court also sought aid and
assistance of the Canadian Court to recognize the Chapter 11 cases
as a "foreign main proceeding" and LSLP as a "foreign
representative" pursuant to Canada's Companies' Creditors
Arrangement Act.
Fraser Milner currently represents and has previously represented
various stakeholders in significant and recent CCAA and cross-
border restructuring proceedings, including Nortel Networks, Inc.,
TerreStar Networks Inc., Catalyst Paper Corporation, Crystallex
International Corp., Trident Resources Corp., Cooper-Standard
Automotive, Grant Forest Products Inc., Abitibi-Bowater, Smurfit
Stone, Doman Industries Limited, The Ravelston Group of Companies,
Bombay Furniture Company of Canada, GT Group Telecom, Pope &
Talbot Ltd., Vic West Corporation, "the Portus Group" and many
others.
Since February 2004, Fraser Milner has acted as Canadian counsel
to the Debtors and their non-Debtor affiliates, providing a broad
array of legal services across a variety of disciplines including
general corporate, tax, regulatory, securities and restructuring.
In the months leading up to the commencement of these Chapter 11
Cases, Fraser Milner was actively involved with the Debtors'
proposed lead restructuring counsel, Milbank, Tweed, Hadley &
McCloy LLP, in advising the Debtors on their restructuring
alternatives, including the preparation of the cross-border
filings.
R. Shayne Kukulowicz, Esq. -- shayne.kukulowicz@fmc-law.com -- a
partner of Fraser Milner, attests the firm is a "disinterested
person," as such term is defined in section 101(14) of the
Bankruptcy Code, as modified by section 1107(b) of the Bankruptcy
Code.
Fraser Milner has informed the Debtors that, subject to the
Court's approval, it will bill for services rendered at its
standard hourly rates which currently are:
$350 - $1,000 for partners and senior
consultants/counsel;
$200 - $550 for associates; and
$140 - $335 for law clerks and paraprofessionals
including articling students.
The names, positions and current hourly rates of the Fraser Milner
attorneys currently expected to have primary responsibility for
providing services to the Debtors are:
(a) R. Shayne Kukulowicz (Partner - Insolvency |
Restructuring Group), $875/hour;
(b) Jane Dietrich (Partner - Insolvency | Restructuring
Group), $580/hour;
(c) Kirsten Embree (Partner - Regulatory), $560/hour; and
(d) Kate Stigler (Associate - Insolvency | Restructuring
Group), $460/hour.
About LightSquared
LightSquared Inc. and 19 of its affiliates filed Chapter 11
bankruptcy petitions (Bankr. S.D.N.Y. Lead Case No. 12-12080) on
May 14, 2012, as the Company seeks to resolve regulatory issues
that have prevented it from building its coast-to-coast integrated
satellite 4G wireless network.
LightSquared had invested more than $4 billion to deploy an
integrated satellite-terrestrial network. In February 2012,
however, the U.S. Federal Communications Commission told
LightSquared the agency would revoke a license to build out the
network as it would interfere with global positioning systems used
by the military and various industries. In March 2012, the
Company's partner, Sprint, canceled a master services agreement.
LightSquared's lenders deemed the termination of the Sprint
agreement would trigger cross-defaults under LightSquared's
prepetition credit agreements.
LightSquared and its prepetition lenders attempted to negotiate a
global restructuring that would provide LightSquared with
liquidity and runway necessary to resolve its issues with the FCC.
Despite working diligently and in good faith, however,
LightSquared and the lenders were not able to consummate a global
restructuring on terms acceptable to all interested parties,
prompting the bankruptcy filing.
As of the Petition Date, the Debtors employed roughly 168 people
in the United States and Canada. As of Feb. 29, 2012, the Debtors
had $4.48 billion in assets (book value) and $2.29 billion in
liabilities.
LightSquared also sought ancillary relief in Canada on behalf of
all of the Debtors, pursuant to the Companies' Creditors
Arrangement Act (Canada) R.S.C. 1985, c. C-36 as amended, in the
Ontario Superior Court of Justice (Commercial List) in Toronto,
Ontario, Canada. The purpose of the ancillary proceedings is to
request the Canadian Court to recognize the Chapter 11 cases as a
"foreign main proceeding" under the applicable provisions of the
CCAA to, among other things, protect the Debtors' assets and
operations in Canada. The Debtors named affiliate LightSquared LP
to act as the "foreign representative" on behalf of the Debtors'
estates.
Judge Shelley C. Chapman presides over the Chapter 11 case.
Lawyers at Milbank, Tweed, Hadley & McCloy LLP serve as counsel to
the Debtors. Kurtzman Carson Consultants LLC serves as claims and
notice agent.
Counsel to UBS AG as agent under the October 2010 facility is
Melissa S. Alwang, Esq., at Latham & Watkins LLP.
The ad hoc secured group of lenders under the Debtors' October
2010 facility was formed in April 2012 to negotiate an out-of-
court restructuring. The members are Appaloosa Management L.P.;
Capital Research and Management Company; Fortress Investment
Group; Knighthead Capital Management LLC; and Redwood Capital
Management. Counsel to the ad hoc secured group is Thomas E.
Lauria, Esq., at White & Case LLP.
Philip Falcone's Harbinger Capital Partners indirectly owns 96% of
LightSquared's outstanding common stock. Harbinger and certain of
its managed and affiliated funds and wholly owned subsidiaries,
including HGW US Holding Company, L.P., Blue Line DZM Corp., and
Harbinger Capital Partners SP, Inc., are represented in the case
by Stephen Karotkin, Esq., at Weil, Gotshal & Manges LLP.
LIGHTSQUARED INC: Kirkland & Ellis OK'd as Litigation Counsel
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
authorized LightSquared Inc., et al., on a final basis, to employ
Kirkland & Ellis LLP as special litigation counsel for the
Debtors.
As reported in the Troubled Company Reporter on June 4, 2012, K&E
has advised the Debtors since February 2011, regarding certain
commercial litigations that have yet to be commenced and that may,
in the future, be brought in this or another court. K&E continues
to work with the Debtors on these matters.
The hourly rates of K&E's personnel are:
Partners $670 - $1,045
Of Counsel $560 - $1,045
Associates $370 - $750
Paraprofessionals $145 - $320
The professionals expected to have primary responsibility for
providing services to the Debtors are:
Eugene F. Assaf $925
Michael F. Williams $745
Daniel Aaron Bress $670
K. Winn Allen $595
Mr. Assaf, a partner at K&E, assures the Court that K&E does not
hold or represent an interest adverse to the Debtor or their
estates.
About LightSquared
LightSquared Inc. and 19 of its affiliates filed Chapter 11
bankruptcy petitions (Bankr. S.D.N.Y. Lead Case No. 12-12080) on
May 14, 2012, as the Company seeks to resolve regulatory issues
that have prevented it from building its coast-to-coast integrated
satellite 4G wireless network.
LightSquared had invested more than $4 billion to deploy an
integrated satellite-terrestrial network. In February 2012,
however, the U.S. Federal Communications Commission told
LightSquared the agency would revoke a license to build out the
network as it would interfere with global positioning systems used
by the military and various industries. In March 2012, the
Company's partner, Sprint, canceled a master services agreement.
LightSquared's lenders deemed the termination of the Sprint
agreement would trigger cross-defaults under LightSquared's
prepetition credit agreements.
LightSquared and its prepetition lenders attempted to negotiate a
global restructuring that would provide LightSquared with
liquidity and runway necessary to resolve its issues with the FCC.
Despite working diligently and in good faith, however,
LightSquared and the lenders were not able to consummate a global
restructuring on terms acceptable to all interested parties,
prompting the bankruptcy filing.
As of the Petition Date, the Debtors employed roughly 168 people
in the United States and Canada. As of Feb. 29, 2012, the Debtors
had $4.48 billion in assets (book value) and $2.29 billion in
liabilities.
LightSquared also sought ancillary relief in Canada on behalf of
all of the Debtors, pursuant to the Companies' Creditors
Arrangement Act (Canada) R.S.C. 1985, c. C-36 as amended, in the
Ontario Superior Court of Justice (Commercial List) in Toronto,
Ontario, Canada. The purpose of the ancillary proceedings is to
request the Canadian Court to recognize the Chapter 11 cases as a
"foreign main proceeding" under the applicable provisions of the
CCAA to, among other things, protect the Debtors' assets and
operations in Canada. The Debtors named affiliate LightSquared LP
to act as the "foreign representative" on behalf of the Debtors'
estates.
Judge Shelley C. Chapman presides over the Chapter 11 case.
Lawyers at Milbank, Tweed, Hadley & McCloy LLP serve as counsel to
the Debtors. Kurtzman Carson Consultants LLC serves as claims and
notice agent.
Counsel to UBS AG as agent under the October 2010 facility is
Melissa S. Alwang, Esq., at Latham & Watkins LLP.
The ad hoc secured group of lenders under the Debtors' October
2010 facility was formed in April 2012 to negotiate an out-of-
court restructuring. The members are Appaloosa Management L.P.;
Capital Research and Management Company; Fortress Investment
Group; Knighthead Capital Management LLC; and Redwood Capital
Management. Counsel to the ad hoc secured group is Thomas E.
Lauria, Esq., at White & Case LLP.
Philip Falcone's Harbinger Capital Partners indirectly owns 96% of
LightSquared's outstanding common stock. Harbinger and certain of
its managed and affiliated funds and wholly owned subsidiaries,
including HGW US Holding Company, L.P., Blue Line DZM Corp., and
Harbinger Capital Partners SP, Inc., are represented in the case
by Stephen Karotkin, Esq., at Weil, Gotshal & Manges LLP.
LIGHTSQUARED INC: Milbank Tweed Approved as Bankruptcy Counsel
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
authorized LightSquared Inc., et al., to employ Milbank, Tweed,
Hadley & McCloy LLP as attorneys for the Debtors, nunc pro tunc to
the bankruptcy filing date.
As reported in the Troubled Company Reporter on May 18, 2012, the
Debtors propose to pay Milbank at its standard hourly rates:
$825 to $1,140 for partners,
$795 to $995 for of counsel,
$295 to $750 for associates and senior attorneys, and
$130 to $290 for legal assistants.
Matthew S. Barr, Esq., a partner at Milbank's Financial
Restructuring Group, attests that the firm does not have any
connection with, or any interest adverse to, the Debtors, their
creditors or any other party in interest, or their attorneys and
accountants. Milbank also is a "disinterested person," as the
term is defined in Section 101(14) of the Bankruptcy Code, as
modified by Section 1107(b) of the Bankruptcy Code.
Prior to and since the Petition Date, Milbank has represented
Harbinger Capital Partners LLC or one or more of its affiliates
who are shareholders of LightSquared in connection with matters
unrelated to the Debtors, including, among other things, corporate
and securities matters unrelated to the Debtors. In addition,
prior to the Petition Date and prior to its representation of
LightSquared, Milbank represented LightSquared's indirect parent
company, HGW US Holding Company, L.P., in connection with
potential financings and general corporate matters. Milbank does
not believe that its representation of Harbinger in matters
unrelated to the Debtors constitutes a conflict of interest in
connection with the Chapter 11 cases. Milbank obtained
appropriate waivers from both Harbinger and LightSquared with
respect to any conflicts of interest arising from Milbank's
previous representation of Harbinger or from Milbank's
representation of LightSquared going forward.
According to Milbank's books and records for the year prior to the
Petition Date, Milbank has received payment from the Debtors of
roughly $2,500,000 on account of invoices for legal services
performed and expenses incurred in contemplation of, or in
connection with, the Debtors' restructuring efforts including,
among other things, the preparation of various "first day"
pleadings and negotiations with various creditor groups on
restructuring.
As of Jan. 17, 2012, the Debtors provided Milbank with an
aggregate advance payment of $1 million to establish a retainer to
pay for legal services rendered or to be rendered in connection
with the Debtors' restructuring efforts. As of the date petition
date, Milbank holds a $370,000 retainer that it will hold
according to its standard internal procedures in the same manner
as Milbank holds retainers received from each of its other
clients. Milbank intends to hold the retainer during the Chapter
11 cases and apply the retainer against fees and expenses allowed,
at Milbank's option, after submission of Milbank's fee
applications and approval by the Court, with any balance to be
returned to the Debtors.
About LightSquared
LightSquared Inc. and 19 of its affiliates filed Chapter 11
bankruptcy petitions (Bankr. S.D.N.Y. Lead Case No. 12-12080) on
May 14, 2012, as the Company seeks to resolve regulatory issues
that have prevented it from building its coast-to-coast integrated
satellite 4G wireless network.
LightSquared had invested more than $4 billion to deploy an
integrated satellite-terrestrial network. In February 2012,
however, the U.S. Federal Communications Commission told
LightSquared the agency would revoke a license to build out the
network as it would interfere with global positioning systems used
by the military and various industries. In March 2012, the
Company's partner, Sprint, canceled a master services agreement.
LightSquared's lenders deemed the termination of the Sprint
agreement would trigger cross-defaults under LightSquared's
prepetition credit agreements.
LightSquared and its prepetition lenders attempted to negotiate a
global restructuring that would provide LightSquared with
liquidity and runway necessary to resolve its issues with the FCC.
Despite working diligently and in good faith, however,
LightSquared and the lenders were not able to consummate a global
restructuring on terms acceptable to all interested parties,
prompting the bankruptcy filing.
As of the Petition Date, the Debtors employed roughly 168 people
in the United States and Canada. As of Feb. 29, 2012, the Debtors
had $4.48 billion in assets (book value) and $2.29 billion in
liabilities.
LightSquared also sought ancillary relief in Canada on behalf of
all of the Debtors, pursuant to the Companies' Creditors
Arrangement Act (Canada) R.S.C. 1985, c. C-36 as amended, in the
Ontario Superior Court of Justice (Commercial List) in Toronto,
Ontario, Canada. The purpose of the ancillary proceedings is to
request the Canadian Court to recognize the Chapter 11 cases as a
"foreign main proceeding" under the applicable provisions of the
CCAA to, among other things, protect the Debtors' assets and
operations in Canada. The Debtors named affiliate LightSquared LP
to act as the "foreign representative" on behalf of the Debtors'
estates.
Judge Shelley C. Chapman presides over the Chapter 11 case.
Lawyers at Milbank, Tweed, Hadley & McCloy LLP serve as counsel to
the Debtors. Kurtzman Carson Consultants LLC serves as claims and
notice agent.
Counsel to UBS AG as agent under the October 2010 facility is
Melissa S. Alwang, Esq., at Latham & Watkins LLP.
The ad hoc secured group of lenders under the Debtors' October
2010 facility was formed in April 2012 to negotiate an out-of-
court restructuring. The members are Appaloosa Management L.P.;
Capital Research and Management Company; Fortress Investment
Group; Knighthead Capital Management LLC; and Redwood Capital
Management. Counsel to the ad hoc secured group is Thomas E.
Lauria, Esq., at White & Case LLP.
Philip Falcone's Harbinger Capital Partners indirectly owns 96% of
LightSquared's outstanding common stock. Harbinger and certain of
its managed and affiliated funds and wholly owned subsidiaries,
including HGW US Holding Company, L.P., Blue Line DZM Corp., and
Harbinger Capital Partners SP, Inc., are represented in the case
by Stephen Karotkin, Esq., at Weil, Gotshal & Manges LLP.
LIGHTSQUARED INC: Moelis & Company Approved as Investment Banker
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
authorized LightSquared Inc., et al., to employ Moelis & Company
LLC as their financial advisor and investment banker under the
terms set forth in an engagement letter between LightSquared and
Moelis dated Feb. 15, 2012.
As reported in the Troubled Company Reporter on May 28, 2012,
Moelis has been advising the Debtors on strategic and
restructuring initiatives for the past three months. Since its
engagement in February 2012, Moelis has provided extensive
prepetition services in preparation for the Debtors? restructuring
efforts, including (a) assisting management in analyzing potential
restructuring transactions, (b) assisting management in analyzing
and negotiating restructuring proposals, (c) assisting management
in conducting extensive meetings and negotiations with the various
stakeholders, (d) performing a valuation analysis of the Debtors
as reorganized debtors, and (e) providing additional investment
banking services in preparation for the Debtors? Chapter 11
filing.
The Debtors will pay Moelis according to this fee and expense
structure:
(a) A $150,000 monthly advisory fee payable in advance of
each month (pro rated for any partial month) during the term of
the Engagement Letter. 100% of the Monthly Fees for the first
three months and 50% of the Monthly Fees thereafter will offset
(subject to certain exceptions), to the extent previously paid,
any Capital Transaction Fee, Sale Transaction Fee (other than a
Sale Transaction Fee for an Asset Sale Transaction), or
Restructuring Fee (other than a Limited HoldCo Restructuring Fee,
Acknowledgment Fee, and Waiver Fee).
(b) A capital transaction fee, payable upon the closing of a
Capital Transaction, in the amount of (i) 1.00% of the aggregate
face value of new money debtor-in-possession financing; plus (ii)
1.50% of the aggregate face value of any new debt raised in a
Capital Transaction (not covered by clauses (i) and (iii)); plus
(iii) 3.25% of the aggregate amount or face value of new capital
raised in a Capital Transaction as new equity or equity-linked
interests. The Capital Transaction Fee will be reduced by 50% of
the aggregate amount of capital (equity or debt) raised from
Harbinger Capital or Pershing Square Capital (or any of their
affiliates or subsidiaries). The Debtors will pay a separate
Capital Transaction Fee in respect of each Capital Transaction in
the event that more than one Capital Transaction occurs.
(c) A sale transaction fee, payable at the closing of a Sale
Transaction, in an amount calculated based on this chart:
Transaction Value Sale Transaction Fee
($ in millions) (as % of Transaction Value)
----------------- ---------------------------
Less than or equal to $500 1.00%
$1,000 0.75%
$2,000 0.55%
$4,000 0.40%
$6,000 0.30%
$10,000 or greater 0.25%
The Company will pay a separate Sale Transaction Fee for each
Asset Sale Transaction.
(d) A restructuring fee, payable at the closing of a
Restructuring, in amount equal to 0.35% of the Debtors? Total
Liabilities in the case of a Restructuring in connection with
these Chapter 11 Cases. If a Restructuring only involves a
Limited HoldCo Restructuring, the Restructuring Fee shall equal
$500,000. If the Limited HoldCo Restructuring is completed, no
Monthly Fees will be credited toward the Limited HoldCo
Restructuring Fee. If a Limited HoldCo Restructuring is
consummated and the Debtors subsequently consummate a
Restructuring, then the Debtors will pay both the Limited HoldCo
Restructuring Fee and the Restructuring Fee. Up to 25% of the
Restructuring Fee (other than a Limited HoldCo Restructuring Fee)
paid to Moelis will offset up to 50% of any Capital Transaction
Fee or Sale Transaction Fee (other than a Sale Transaction Fee for
an Asset Sale Transaction).
(e) In the event there is a transaction that is both a
Capital Transaction and a Sale Transaction (excluding any Asset
Sale Transaction), the Debtors will pay Moelis the higher of the
Capital Transaction Fee and the Sale Transaction Fee (and not
both). In the event there is a transaction that is both a Sale
Transaction (excluding any Asset Sale Transaction) and a
Restructuring, the Debtors will pay Moelis the higher of the Sale
Transaction Fee and the Restructuring Fee (and not both).
(f) All reasonable out-of-pocket expenses incurred by Moelis.
As of the Petition Date, the Debtors do not owe Moelis any fees
for services performed or expenses incurred under the Engagement
Letter. According to the books and records of Moelis, during the
90-day period before the Petition Date, Moelis received $1,350,000
for professional services performed and $83,132 for expenses
incurred.
The Debtors also have agreed to provide indemnification to the
firm.
William Q. Derrough -- william.derrough@moelis.com -- Managing
Director of Moelis, attests that Moelis (a) is a ?disinterested
person? within the meaning of section 101(14) of the Bankruptcy
Code, (b) does not hold or represent an interest adverse to the
Debtors? estates, and (c) has no connection to the Debtors, their
creditors, or their related parties.
About LightSquared
LightSquared Inc. and 19 of its affiliates filed Chapter 11
bankruptcy petitions (Bankr. S.D.N.Y. Lead Case No. 12-12080) on
May 14, 2012, as the Company seeks to resolve regulatory issues
that have prevented it from building its coast-to-coast integrated
satellite 4G wireless network.
LightSquared had invested more than $4 billion to deploy an
integrated satellite-terrestrial network. In February 2012,
however, the U.S. Federal Communications Commission told
LightSquared the agency would revoke a license to build out the
network as it would interfere with global positioning systems used
by the military and various industries. In March 2012, the
Company's partner, Sprint, canceled a master services agreement.
LightSquared's lenders deemed the termination of the Sprint
agreement would trigger cross-defaults under LightSquared's
prepetition credit agreements.
LightSquared and its prepetition lenders attempted to negotiate a
global restructuring that would provide LightSquared with
liquidity and runway necessary to resolve its issues with the FCC.
Despite working diligently and in good faith, however,
LightSquared and the lenders were not able to consummate a global
restructuring on terms acceptable to all interested parties,
prompting the bankruptcy filing.
As of the Petition Date, the Debtors employed roughly 168 people
in the United States and Canada. As of Feb. 29, 2012, the Debtors
had $4.48 billion in assets (book value) and $2.29 billion in
liabilities.
LightSquared also sought ancillary relief in Canada on behalf of
all of the Debtors, pursuant to the Companies' Creditors
Arrangement Act (Canada) R.S.C. 1985, c. C-36 as amended, in the
Ontario Superior Court of Justice (Commercial List) in Toronto,
Ontario, Canada. The purpose of the ancillary proceedings is to
request the Canadian Court to recognize the Chapter 11 cases as a
"foreign main proceeding" under the applicable provisions of the
CCAA to, among other things, protect the Debtors' assets and
operations in Canada. The Debtors named affiliate LightSquared LP
to act as the "foreign representative" on behalf of the Debtors'
estates.
Judge Shelley C. Chapman presides over the Chapter 11 case.
Lawyers at Milbank, Tweed, Hadley & McCloy LLP serve as counsel to
the Debtors. Kurtzman Carson Consultants LLC serves as claims and
notice agent.
Counsel to UBS AG as agent under the October 2010 facility is
Melissa S. Alwang, Esq., at Latham & Watkins LLP.
The ad hoc secured group of lenders under the Debtors' October
2010 facility was formed in April 2012 to negotiate an out-of-
court restructuring. The members are Appaloosa Management L.P.;
Capital Research and Management Company; Fortress Investment
Group; Knighthead Capital Management LLC; and Redwood Capital
Management. Counsel to the ad hoc secured group is Thomas E.
Lauria, Esq., at White & Case LLP.
Philip Falcone's Harbinger Capital Partners indirectly owns 96% of
LightSquared's outstanding common stock. Harbinger and certain of
its managed and affiliated funds and wholly owned subsidiaries,
including HGW US Holding Company, L.P., Blue Line DZM Corp., and
Harbinger Capital Partners SP, Inc., are represented in the case
by Stephen Karotkin, Esq., at Weil, Gotshal & Manges LLP.
LITHIUM TECHNOLOGY: Timothy Ryder Resigns as CFO
------------------------------------------------
Timothy J. Ryder resigned from his position as the Chief Financial
Officer of Lithium Technology Corporation effective June 15, 2012.
Mr. Ryder is leaving to pursue other business interests.
About Lithium Technology
Plymouth Meeting, Pa.-based Lithium Technology Corporation is a
mid-volume production stage company that develops large format
lithium-ion rechargeable batteries to be used as a new power
source for emerging applications in the automotive, stationary
power, and national security markets.
The Company was not able to file its annual report for the period
ended Dec. 31, 2011, and quarterly report for the period ended
March 30, 2012.
For the nine months ended Sept. 30, 2011, the Company reported a
net loss of $12.26 million on $6.06 million of total revenue. The
Company reported a net loss of $7.25 million on $6.35 million
of products and services sales for the year ended Dec. 31, 2010,
compared with a net loss of $10.51 million on $7.37 million of
product and services sales during the prior year.
The Company's balance sheet at Sept. 30, 2011, showed $8.83
million in total assets, $35.09 million in total liabilities and a
$26.26 million total stockholders' deficit.
Going Concern
As reported by the TCR on April 8, 2011, Amper, Politziner &
Mattia, LLP, Edison, New Jersey, after auditing the Company's
financial statements for the year ended Dec. 31, 2010, noted that
the Company has recurring losses from operations since inception
and has a working capital deficiency that raise substantial doubt
about its ability to continue as a going concern.
Bankruptcy Warning
The Form 10-Q for the quarter ended Sept. 30, 2011, noted that the
Company's operating plan seeks to minimize its capital
requirements, but the expansion of its production capacity to meet
increasing sales and refinement of its manufacturing process and
equipment will require additional capital.
The Company raised capital through the sale of securities closing
in the second quarter of 2011 and realized proceeds from the
licensing of its technology pursuant to the terms of a licensing
agreement and the sale of inventory used in manufacturing its
batteries as part of the establishment of a joint venture in the
fourth quarter of 2011, but is continuing to seek other financing
initiatives and needs to raise additional capital to meet its
working capital needs, for the repayment of debt and for capital
expenditures. Such capital is expected to come from the sale of
securities. The Company believes that if it raises approximately
$4 million in additional debt and equity financings it would have
sufficient funds to meet its needs for working capital, capital
expenditures and expansion plans through the year ending Dec. 31,
2012.
No assurance can be given that the Company will be successful in
completing any financings at the minimum level necessary to fund
its capital equipment, debt repayment or working capital
requirements, or at all. If the Company is unsuccessful in
completing these financings, it will not be able to meet its
working capital, debt repayment or capital equipment needs or
execute its business plan. In that case the Company will assess
all available alternatives including a sale of its assets or
merger, the suspension of operations and possibly liquidation,
auction, bankruptcy, or other measures. These conditions raise
substantial doubt about the Company's ability to continue as a
going concern.
LUMBER PRODUCTS: Court OKs Edward Hostmann as Chapter 11 Trustee
----------------------------------------------------------------
The United States Bankruptcy Court blessed the appointment of
Edward C. Hostmann as Chapter 11 trustee in the bankruptcy case of
Lumber Products.
On April 13, 2012, the United States Trustee sent an e-mail to the
creditors on the Debtor's list of the 20 largest unsecured
creditors requesting that they respond if they would like to have
input in the trustee selection process and inviting them to share
any qualities or skills they thought would be desirable in a
chapter 11 trustee.
The U.S. Trustee engaged in a limited consultation with counsel
for unsecured creditor Masonite Corporation and received
Masonite's suggestions for qualities and skills that it believed
would be desirable in a chapter 11 trustee.
The U.S. Trustee attests that Edward C. Hostmann is a
"disinterested person" as the term is defined in Section 101(14)
of the Bankruptcy Code.
About Lumber Products
Lumber Products -- http://www.lumberproducts.com/-- is a
wholesale distributor of some of the finest hardwood lumber,
hardwood plywood, and door and millwork products to the Northwest,
Intermountain, and Southwest states since 1938. It has
headquarters in Tualatin, Oregon, and operations in Oregon,
Washington, Idaho, Montana, Utah, Arizona, and New Mexico. Lumber
Products is the sole owner of Lumber Products Holding and
Management Company. Holdco is the sole owner of: Lumber Products
Holding and Management Company; Sunrise Wood Products, Inc.;
Lumber Products Washington, Inc.; Components & Millwork, Inc.;
Wood Window Distributors, Inc.; D&J Wood Resources, Inc.; and
Brady International Hardwoods Company.
Lumber Products filed for Chapter 11 bankruptcy (Bankr. D. Ore.
Case No. 12-32729) on April 11, 2012, listing under $50 million in
assets and debts. Judge Elizabeth L. Perris presides over the
case. The petition was signed by Craig Hall, president and chief
operating officer.
The Debtor owes Wells Fargo in excess of $22.8 million. Wells
Fargo is represented by Lane Powell PC.
LUMBER PRODUCTS: Court OKs Tonkon Torp as Ch.11 Trustee's Counsel
-----------------------------------------------------------------
Edward C. Hostmann, the Chapter 11 Trustee for Lumber Products,
sought and obtained permission from the U.S. Bankruptcy Court to
employ Tonkon Torp LLP as the Trustee's counsel.
The firm's hourly rates are:
Personnel Rates
--------- -----
Albert N. Kennedy Partner $475
Michael W. Fletcher Associate $325
Spencer C. Fisher Paralegal $150
Leslie D. Hurd Paralegal $ 90
The Chapter 11 Trustee attests that the firm has no connection
with the Debtor's creditors or any other adverse party or its
attorneys.
About Lumber Products
Lumber Products -- http://www.lumberproducts.com/-- is a
wholesale distributor of some of the finest hardwood lumber,
hardwood plywood, and door and millwork products to the Northwest,
Intermountain, and Southwest states since 1938. It has
headquarters in Tualatin, Oregon, and operations in Oregon,
Washington, Idaho, Montana, Utah, Arizona, and New Mexico. Lumber
Products is the sole owner of Lumber Products Holding and
Management Company. Holdco is the sole owner of: Lumber Products
Holding and Management Company; Sunrise Wood Products, Inc.;
Lumber Products Washington, Inc.; Components & Millwork, Inc.;
Wood Window Distributors, Inc.; D&J Wood Resources, Inc.; and
Brady International Hardwoods Company.
Lumber Products filed for Chapter 11 bankruptcy (Bankr. D. Ore.
Case No. 12-32729) on April 11, 2012, listing under $50 million in
assets and debts. Judge Elizabeth L. Perris presides over the
case. The petition was signed by Craig Hall, president and chief
operating officer.
The Debtor owes Wells Fargo in excess of $22.8 million. Wells
Fargo is represented by Lane Powell PC.
LUMBER PRODUCTS: Court OKs Kiemle & Hagood as Real Estate Broker
----------------------------------------------------------------
Edward C. Hostmann, Chapter 11 Trustee for Lumber Products, sought
and obtained permission from the U.S. Bankruptcy Court to employ
Kiemle & Hagood as the trustee's real estate broker.
The Chapter 11 Trustee attests that it has no connection with the
Debtor's creditors or any other adverse party or its attorneys.
The Chapter 11 Trustee seeks to compensate Kiemle & Hagood at its
usual and customary commission rate of 5% of the sale price of the
property, to be paid out of the proceeds from the sale.
About Lumber Products
Lumber Products -- http://www.lumberproducts.com/-- is a
wholesale distributor of some of the finest hardwood lumber,
hardwood plywood, and door and millwork products to the Northwest,
Intermountain, and Southwest states since 1938. It has
headquarters in Tualatin, Oregon, and operations in Oregon,
Washington, Idaho, Montana, Utah, Arizona, and New Mexico. Lumber
Products is the sole owner of Lumber Products Holding and
Management Company. Holdco is the sole owner of: Lumber Products
Holding and Management Company; Sunrise Wood Products, Inc.;
Lumber Products Washington, Inc.; Components & Millwork, Inc.;
Wood Window Distributors, Inc.; D&J Wood Resources, Inc.; and
Brady International Hardwoods Company.
Lumber Products filed for Chapter 11 bankruptcy (Bankr. D. Ore.
Case No. 12-32729) on April 11, 2012, listing under $50 million in
assets and debts. Judge Elizabeth L. Perris presides over the
case. The petition was signed by Craig Hall, president and chief
operating officer.
The Debtor owes Wells Fargo in excess of $22.8 million. Wells
Fargo is represented by Lane Powell PC.
MAKENA GREAT: Claims Bar Date Set for June 29
---------------------------------------------
Creditors have until June 29, 2012, to file proofs of claim
against The Makena Great American Anza Company LLC and GAC Storage
El Monte LLC.
About GAC Storage
GAC Storage Lansing, LLC, owns and operates a warehouse and
storage facility with 522 storage units, generally located at 2556
Bernice Road, Lansing, Illinois. The Company filed for Chapter 11
bankruptcy (Bankr. N.D. Ill. Case No. 11-40944) on Oct. 7, 2011.
Jay S. Geller, Esq., D. Sam Anderson, Esq., and Halliday Moncure,
Esq., at Bernstein, Shur, Sawyer & Nelson, P.A., represents the
Debtor as counsel. Robert M, Fishman, Esq., and Gordon E.
Gouveia, Esq., at Shaw Gussis Fishman Glantz Wolfson, & Towbin
LLC, in Chicago, represents the Debtor as local counsel. It
estimated $1 million to $10 million in assets and debts. The
petition was signed by Noam Schwartz, secretary and treasurer of
EBM Mgmt Servs, Inc., manager of GAC Storage, LLC.
The Debtors' cases are being jointly administered along with the
Chapter 11 cases of The Makena Great American Anza Company, LLC,
and San Tan Plaza, LLC, under lead case no. 11-40944.
About Makena Great American Anza Company
The Makena Great American Anza Company LLC --
http://www.makenacapital.net/-- is a commercial shopping
center developers in Southern California. Makena Great American
leads the way in the acquisition and development of "A-Location"
small commercial shopping centers and corner properties in
Southern California.
The Makena Great American Anza Company filed a Chapter 11 petition
(Bankr. N.D. Ill. Case No. 11-48549) on Dec. 1, 2011, in Chicago.
Gordon E. Gouveia, Esq., at Shaw Gussis Fishman Glantz Wolfson &
Towbin, LLC, in Chicago, serves as local counsel to the Debtor.
D. Sam Anderson, Esq., and Halliday Moncure, Esq., at Bernstein,
Shur, Sawyer & Nelson, P.A., in Portland, Maine, serve as counsel
to the Debtor. The Debtor disclosed $13,938,161 in assets and
$17,723,488 in liabilities.
MARCO POLO: Plan for Dutch Ship Owner Set for Aug. 14 Approval
--------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Seaarland Shipping Management, a Dutch ship owner,
scheduled a confirmation hearing for Aug. 14 when the bankruptcy
court in New York approved a disclosure statement explaining the
liquidating Chapter 11 plan.
According to the report, at the confirmation hearing, Seaarland
will seek approval of the plan to turn the vessels over to secured
lenders, who agreed they won't be paid on unsecured deficiency
claims until unsecured creditors have received 5%. The primary
secured lenders are Royal Bank of Scotland and Credit Agricole
Corporate & Investment Bank. It was agreed that the Credit
Agricole secured claim against three vessels is $93.5 million and
that the RBS secured claim against the other three is $124.8
million. The disclosure statement contains a projection that
unsecured creditors will recover nothing to 5% on their claims.
About Marco Polo
Marco Polo Seatrade B.V. operates an international commercial
vessel management company that specializes in providing commercial
and technical vessel management services to third parties.
Founded in 2005, the Company mainly operates under the name of
Seaarland Shipping Management and maintains corporate headquarters
in Amsterdam, the Netherlands. The primary assets consist of six
tankers that are regularly employed in international trade, and
call upon ports worldwide.
Marco Polo and three affiliated entities filed for Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 11-13634) on July 29,
2011. The other affiliates are Seaarland Shipping Management
B.V.; Magellano Marine C.V.; and Cargoship Maritime B.V.
Marco Polo is the sole owner of Seaarland, which in turn is the
sole owner of Cargoship, and also holds a 5% stake in Magellano.
The remaining 95% stake in Magellano is owned by Amsterdam-based
Poule B.V., while another Amsterdam company, Falm International
Holding B.V. is the sole owner of Marco Polo. Falm and Poule
didn't file bankruptcy petitions.
The filings were prompted after lender Credit Agricole Corporate
& Investment Bank seized one ship on July 21, 2011, and was on
the cusp of seizing two more on July 29. The arrest of the
vessel was authorized by the U.K. Admiralty Court. Credit
Agricole also attached a bank account with almost US$1.8 million
on July 29. The Chapter 11 filing precluded the seizure of the
two other vessels. The company started a lawsuit against the two
creditors in January 2012.
The cases are before Judge James M. Peck. Evan D. Flaschen, Esq.,
Robert G. Burns, Esq., and Andrew J. Schoulder, Esq., at Bracewell
& Giuliani LLP, in New York, serve as the Debtors' bankruptcy
counsel. Kurtzman Carson Consultants LLC serves as notice and
claims agent.
The petition noted that the Debtors' assets and debts are both
more than US$100 million and less than US$500 million.
Tracy Hope Davis, the United States Trustee for Region 2,
appointed three members to serve on the Official Committee of
Unsecured Creditors. The Committee has retained Blank Rome LLP as
its attorney.
Creditor Credit Agricole Corporate and Investment Bank is
represented by Alfred E. Yudes, Jr., Esq., and Jane Freeberg
Sarma, Esq., at Watson, Farley & Williams (New York) LLP.
Gregory M. Petrick, Esq., Ingrid Bagby, Esq., and Sharon J.
Richardson, Esq., at Cadwalader, Wickersham & Taft LLP, in New
York, represents secured creditor and post-petition lender The
Royal bank of Scotland plc.
MARIANA RETIREMENT FUND: Bankr. Judge Ensures Payment for Lawyers
-----------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the bankruptcy judge in Honolulu ruled last week that
although the Northern Mariana Islands Retirement Fund isn't
entitled to reorganize in Chapter 11, the case won't be formally
dismissed until July or August. U.S. Bankruptcy Judge Robert J.
Faris held a hearing on June 1 where he said from the bench that
the fund isn't eligible for Chapter 11 because it's an agent of
the commonwealth's government.
According to the report Judge Faris wrote a formal opinion on
June 13 explaining his reasons. In the written opinion, Judge
Faris said the trustees of the pension fund "should be praised,
not criticized for commencing this case." He said the effort to
use Chapter 11 was "praiseworthy even though it cannot succeed."
Judge Faris explained in his written opinion how the fund isn't
eligible for bankruptcy because it provides retirement benefits
for government employees, a "quintessential governmental
function."
Judge Faris told the lawyers in the case to file their fee
requests by June 29. He will hold a hearing to approve fees on
July 27 at the earliest. The judge said he won't dismiss the case
formally until approved compensation for the lawyers has been
paid. By refraining from immediate dismissal, Judge Faris is
retaining the ability to ensure the lawyers will be paid the
amounts he believes proper.
About NMI Retirement Fund
The Northern Mariana Islands Retirement Fund --
http://www.nmiretirement.com/-- is a public corporation of the
Commonwealth of the Northern Mariana Islands that receives and
invests retirement contributions and pays certain benefits to or
on account of certain retirees of the Commonwealth government,
their survivors, and certain disabled persons.
The Fund, through its administrator Richard Villagomez, filed a
Chapter 11 bankruptcy petition in the U.S. District Court for the
Northern District of Mariana Islands in Saipan (Case No. 12-00003)
on April 17, 2012.
The Fund is represented by Brown Rudnick LLP and the Law Office of
Braddock J. Huesman, LLC.
The Fund said in court papers that the Chapter 11 filing was
precipitated by the discrepancy between the Debtor's current
ability to pay benefits to beneficiaries and the Debtor's current
obligations to those same beneficiaries. The Fund said it would
exhaust its cash by July 2014. It has been unable to collect a
$325 million judgment against the islands' government, and the
commonwealth decided to reduce contributions toward workers'
pensions.
As a result of continuous underfunding, which necessitated
withdrawing from its portfolio to cover funding shortfalls, the
value of the Fund's assets has fallen from $353,475,412 in 2009 to
its current level of $268,448,997, the Debtor's counsel has said.
The counsel also said the Fund is subject to liabilities (both
current and actuarial) totaling about $911 million.
An official committee of unsecured creditors, consisting of Fund
members, has been appointed in the case.
MCM RESORT: Case Summary & 12 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: MCM Resort Properties, LLC
P.O. Box 351
Lake George, NY 12845
Bankruptcy Case No.: 12-11618
Chapter 11 Petition Date: June 15, 2012
Court: United States Bankruptcy Court
Northern District of New York (Albany)
Debtor's Counsel: Richard L. Weisz, Esq.
HODGSON RUSS LLP
677 Broadway
Albany, NY 12207
Tel: (518) 465-2333
E-mail: Rweisz@hodgsonruss.com
Scheduled Assets: $3,000,000
Scheduled Liabilities: $2,734,856
A copy of the Company's list of its 12 largest unsecured creditors
filed together with the petition is available for free at
http://bankrupt.com/misc/nynb12-11618.pdf
The petition was signed by Christine N. Boychuk, member.
MORGANS HOTEL: Nine Directors Elected at Annual Meeting
-------------------------------------------------------
At the Morgans Hotel Group Co.'s annual meeting of stockholders
held on May 16, 2012, four proposals were submitted to a vote of
the Company's stockholders. Nine directors were elected to
service on the Company's Board of Directors for a term that ends
at the 2013 Annual Meeting of Stockholders, namely:
(1) David T. Hamamoto;
(2) Michael J. Gross;
(3) Ronald W. Burkle;
(4) Robert Friedman;
(5) Jeffrey M. Gault;
(6) Thomas L. Harrison;
(7) Jason T. Kalisman;
(8) Michael D. Malone; and
(9) Andrew Sasson.
About Morgans Hotel Group
Based in New York, Morgans Hotel Group Co. (Nasdaq: MHGC) --
http://www.morganshotelgroup.com/-- is widely credited as the
creator of the first "boutique" hotel and a continuing leader of
the hotel industry's boutique sector. Morgans Hotel Group
operates and owns, or has an ownership interest in, Morgans,
Royalton and Hudson in New York, Delano and Shore Club in South
Beach, Mondrian in Los Angeles and South Beach, Clift in San
Francisco, Ames in Boston, and Sanderson and St Martins Lane in
London. Morgans Hotel Group and an equity partner also own the
Hard Rock Hotel & Casino in Las Vegas and related assets. Morgans
Hotel Group also manages hotels in Isla Verde, Puerto Rico and
Playa del Carmen, Mexico. Morgans Hotel Group has other property
transactions in various stages of completion, including projects
in SoHo, New York and Palm Springs, California.
The Company reported a net loss of $87.95 million in 2011, a net
loss of $83.64 million in 2010, and a net loss of $101.60 million
in 2009.
The Company's balance sheet at March 31, 2012, showed $544.25
million in total assets, $642.07 million in total liabilities,
$5.41 million in redeemable noncontrolling interest, and a
$103.23 million total deficit.
MSR RESORT: Midland Loan Consents to Cash Use Until Sept. 1
-----------------------------------------------------------
MSR Resort Golf Course LLC, et al., notified the Bankruptcy Court
for the Southern District of New York that they entered a
stipulation and order extending cash collateral use under final
order authorizing them to (i) use the prepetition secured parties'
cash collateral and (ii) provide adequate protection to the
prepetition secured parties.
The stipulation with Midland Loan Services, Inc., provides that,
among other things:
-- Midland has consented to the Debtors' continuing use of cash
collateral until Sept. 1, 2012; and
-- the terms and conditions of the stipulation and order will
be immediately effective and enforceable upon its entry.
About MSR Resort
MSR Hotels & Resorts, formerly known as CNL Hotels & Resorts Inc.,
owns a portfolio of eight luxury hotels with over 5,500 guest
rooms, including the Arizona Biltmore Resort & Spa in Phoenix, the
Ritz-Carlton in Orlando, Fla., and Hawaii's Grand Wailea Resort
Hotel & Spa in Maui.
On Jan. 28, 2011, CNL-AB LLC acquired the equity interests in the
portfolio through a foreclosure proceeding. CNL-AB LLC is a joint
venture consisting of affiliates of Paulson & Co. Inc., a joint
venture affiliated with Winthrop Realty Trust, and affiliates of
Capital Trust, Inc.
Morgan Stanley's CNL Hotels & Resorts Inc. owned the resorts
before the Jan. 28 foreclosure.
Following the acquisition, five of the resorts with mortgage debt
scheduled to mature on Feb. 1, 2011, were sent to Chapter 11
bankruptcy by the Paulson and Winthrop joint venture affiliates.
MSR Resort Golf Course LLC and its affiliates filed for Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 11-10372) in Manhattan
on Feb. 1, 2011. The resorts subject to the filings are Grand
Wailea Resort and Spa, Arizona Biltmore Resort and Spa, La Quinta
Resort and Club and PGA West, Doral Golf Resort and Spa, and
Claremont Resort and Spa.
James H.M. Sprayregen, P.C., Esq., Paul M. Basta, Esq., Edward O.
Sassower, Esq., and Chad J. Husnick, Esq., at Kirkland & Ellis,
LLP, serve as the Debtors' bankruptcy counsel. Houlihan Lokey
Capital, Inc., is the Debtors' financial advisor. Kurtzman Carson
Consultants LLC is the Debtors' claims agent.
The five resorts had $2.2 billion in assets and $1.9 billion in
debt as of Nov. 30, 2010, according to court filings. In its
schedules, debtor MSR Resort disclosed $59,399,666 in total assets
and $1,013,213,968 in total liabilities.
The resorts have agreement with lenders allowing the companies to
remain in Chapter 11 at least until September 2012. Donald Trump
has a contract to buy the Doral Golf Resort and Spa in Miami for
$170 million. There will be an auction to learn if there is a
better bid. The resorts have said that Trump's offer price implies
a value for all the properties "significantly" exceeding the
$1.5 billion in debt.
The Official Committee of Unsecured Creditors is represented by
Martin G. Bunin, Esq., and Craig E. Freeman, Esq., at Alston &
Bird LLP, in New York.
MUNSTER MARATHON: Case Summary & 8 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Munster Marathon, Inc.
9451 Calumet Avenue
Munster, IN 46321
Bankruptcy Case No.: 12-22211
Chapter 11 Petition Date: June 14, 2012
Court: United States Bankruptcy Court
Northern District of Indiana (Hammond Division)
Judge: J. Philip Klingeberger
Debtor's Counsel: Kenneth A. Manning (KS), Esq.
MANNING & GONZALEZ, PC
200 Monticello Drive
Dyer, IN 46311
Tel: (219) 865-8376
Fax: (219) 865-4054
E-mail: Ken@kmmglawfirm.com
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its eight largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/innb12-22211.pdf
The petition was signed by Rick J. Wells, as designated
representative.
NATIONAL QUALITY: Incurs $139,000 Net Loss in First Quarter
-----------------------------------------------------------
National Quality Care, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
a net loss of $139,361 on $0 of revenue for the three months ended
March 31, 2011, compared with net income of $2.99 million on $0 of
revenue for the same period during the prior year.
The Company's balance sheet at March 31, 2011, showed $3.08
million in total assets, $3.13 million in total liabilities and a
$54,976 total stockholders' deficiency.
A copy of the Form 10-Q is available for free at:
http://is.gd/xQkF7K
About National Quality Care
Los Angeles, Calif.-based National Quality Care, Inc., was, prior
to the sale of substantially all its assets on March 19, 2010, a
research and development company. Its platform technology was a
wearable artificial kidney for dialysis and other medical
applications (the "Wearable Kidney"). This device treats the
blood of patients through a pulsating, dual-chambered pump.
Continuous dialysis has always been possible for patients who are
able to make several weekly visits to a dialysis clinic to be
attached to a large machine for three to four hours at a time.
With a wearable artificial kidney, patients would be able to have
24-hour dialysis, seven days a week, without having to spend long
hours attached to a large machine at a clinic, allowing them to
maintain a reasonable life style.
NEC HOLDINGS: Trustee Works Out Deal for Contaminated Plant
-----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the Chapter 7 trustee liquidating the remnants of
National Envelope Corp. came to terms with environmental
regulators allowing the abandonment of a contaminated plant in New
Jersey. When NEC sold the assets, $9 million was set aside to pay
expenses in winding down the remainder of the business and the
Chapter 11 case. In the wind-down budget, $2 million was earmarked
for environmental remediation. No one would purchase the New
Jersey plant on account of contamination.
The report recounts that the trustee sought permission to abandon
the plant and retain the $2 million for distribution to creditors.
Environmental regulators objected, and U.S. Bankruptcy Judge Peter
J. Walsh ruled in March that about $1.4 million remaining in the
account must be spent on remediation. The remainder already was
spent safeguarding the contaminated plant.
According to the report, the trustee and regulators resolved their
remaining disputes. The trustee will immediately pay $1 million
to the regulators. The remainder will be paid to regulators when
the property is sold or no later than April 1. The trustee won't
abandon the property until Sept. 1 and will try to find a buyer in
the meantime.
Regulators, Mr. Rochelle notes, objected to abandonment based on a
case decided in 1986 by the U.S. Supreme Court that doesn't allow
a bankrupt company to walk away from environmental pollution by
abandoning an asset.
About NEC Holdings
Uniondale, New York-based National Envelope Corporation was
the largest manufacturer of envelopes in the world with
14 manufacturing facilities and 2 distribution centers and
approximately 3,500 employees in the U.S. and Canada.
NEC Holdings Corp., together with affiliates, including National
Envelope Inc., filed for Chapter 11 (Bankr. D. Del. Lead Case No.
10-11890) on June 10, 2010. Kara Hammond Coyle, Esq., at Young
Conaway Stargatt & Taylor LLP, served as bankruptcy counsel to the
Debtors. David S. Heller, Esq., at Josef S. Athanas, Esq., and
Stephen R. Tetro II, Esq., at Latham & Watkins LLP, served as
co-counsel. The Garden City Group is the claims and notice agent.
Bradford J. Sandler, Esq., and Robert J. Feinstein, Esq., at
Pachuiski Stang Ziehl & Jones LLP, represented the Official
Committee of Unsecured Creditors. Morgan Joseph & Co., Inc.,
served as the financial advisor to the Committee. NEC Holdings
estimated assets and debts of $100 million to $500 million in its
Chapter 11 petition.
In September 2010, National Envelope's key assets were bought in
a roughly $208 million deal by The Gores Group LLC, a West Coast
private equity firm that manages about $2.9 billion of capital.
Judge Peter J. Walsh on Dec. 12, 2011, approved NEC Holdings'
request to convert its Chapter 11 case into a full liquidation.
Judge Walsh approved NEC's October request to liquidate the
remainder of its assets, which the company said was necessary
because it was quickly running out of cash to cover the remaining
claims against it, including the cleanup of a New Jersey
manufacturing site.
NEW ENGLAND BUILDING: US Trustee Names 7-Member Creditors Panel
---------------------------------------------------------------
William K. Harrington, the United States Trustee for the District
of Maine, appointed seven creditors to serve on the Official
Committee of Unsecured Creditors in the Chapter 11 case of New
England Building Materials Inc.
The committee members are:
1. Chuck Boucher
Boise Cascade
32 Manning Rd
Bellerica, MA 01821
2. Paula Smith
Huttig Building Products
25 Lehoux Drive
Hooksett, NH 03106
3. Bruce Gillies, Jr.
Gillies & Prittie, Inc.
151 Pleasant Hill Road
Scarborough, ME 04074
4. Ted Severance
Coastal Forest Products
P.O. Box 10898
Bedford, NH 03110
5. Steve Post
Brockway Smith Co.
146 Dascomb Rd.
Andover, MA 01810
6. Dale Baird
BlueLinx Corp
4300 Parkway
Atlanta, GA 30339
7. Eric Katz
Gebsco Realty Corp.
410 Boston Post Rd., Suite 22
Sudbury, MA 01776
About New England Building Materials
Based in Sanford, Maine, New England Building Materials LLC,
fka Lavalley Lumber Company LLC and Poole Brothers, filed for
Chapter 11 bankruptcy (Bankr. D. Maine Case No. 12-20109) on
Feb. 14, 2012. New England Building Materials is engaged in the
business of manufacturing and selling, at wholesale, Eastern White
Pine lumber and related products. It was also engaged in the
business of selling lumber products at retail, through outlets in
Maine and Massachusetts, although, as of the bankruptcy filing
date, it has made the determination to cease retail activities.
Chief Judge James B. Haines Jr. presides over the case. Lawyers
at Marcus, Clegg & Mistretta, P.A., serve as the Debtor's counsel.
In its petition, the Debtor estimated $10 million to $50 million
in assets and debts. The petition was signed by Richard I.
Thompson, chief financial officer.
NEWPAGE CORP: Reaches New Deal With Unions
------------------------------------------
Lance Duroni at Bankruptcy Law360 reports that NewPage Corp. asked
a Delaware bankruptcy judge on Thursday to approve a new
collective bargaining agreement reached with its unions, which the
private equity-owned paper manufacturer says will slash labor
costs and smooth its path out of Chapter 11.
The deal combines all NewPage paper mills and unions under a
single "master agreement" setting terms for wages, pensions and
health insurance, while extending each individual union contract
through at least 2016, according to a motion filed with the court
obtained by Bankruptcy Law360.
Jacqueline Palank at Dow Jones' Daily Bankruptcy Review reports
that the new labor terms include modernizing its pension plan and
phasing out life and medical insurance for new retirees in several
years.
About NewPage Group
Headquartered in Miamisburg, Ohio, NewPage Corporation was the
leading producer of printing and specialty papers in North
America, based on production capacity, with $3.6 billion in net
sales for the year ended Dec. 31, 2010. NewPage owns paper mills
in Kentucky, Maine, Maryland, Michigan, Minnesota, Wisconsin and
Nova Scotia, Canada.
NewPage Group, NewPage Holding, NewPage, and certain of their U.S.
subsidiaries commenced Chapter 11 voluntary cases (Bankr. D. Del.
Case Nos. 11-12804 through 11-12817) on Sept. 7, 2011. Its
subsidiary, Consolidated Water Power Company, is not a part of the
Chapter 11 proceedings.
Separately, on Sept. 6, 2011, its Canadian subsidiary, NewPage
Port Hawkesbury Corp., brought a motion before the Supreme Court
of Nova Scotia to commence proceedings to seek creditor protection
under the Companies' Creditors Arrangement Act of Canada. NPPH is
under the jurisdiction of the Canadian court and the court-
appointed Monitor, Ernst & Young in the CCAA Proceedings.
Initial orders were issued by the Supreme Court of Nova Scotia on
Sept. 9, 2011 commencing the CCAA Proceedings and approving a
settlement and transition agreement transferring certain current
assets to NewPage against a settlement payment of $25 million and
in exchange for being relieved of all liability associated with
NPPH. On Sept. 16, 2011, production ceased at NPPH.
Martin J. Bienenstock, Esq., Judy G.Z. Liu, Esq., and Philip M.
Abelson, Esq., Dewey & LeBoeuf LLP, in New York, serve as counsel
in the Chapter 11 case. Laura Davis Jones, Esq., at Pachulski
Stang Ziehl & Jones LLP, in Wilmington, Delaware, serves as co-
counsel. Lazard Freres & Co. LLC is the investment banker, and
FTI Consulting Inc. is the financial advisor. Kurtzman Carson
Consultants LLC is the claims and notice agent. In its balance
sheet, the Debtors disclosed $3.4 billion in assets and $4.2
billion in total liabilities as of June 30, 2011.
The Official Committee of Unsecured Creditors selected Paul
Hastings LLP as its bankruptcy counsel and Young Conaway Stargatt
& Taylor, LLP to act as its Delaware and conflicts counsel.
NewPage prevailed over most objections from the official
creditors' committee and won agreement from the bankruptcy judge
on final approval of $600 million in secured financing.
Moody's Investors Service assigned a Ba2 rating to the
$350 million first-out revolving debtor-in-possession credit
facility and a B2 rating to the $250 million second-out debtor-in-
possession term loan for NewPage.
NORTHERN CALIFORNIA BANCORP: Reports $1.1MM Net Income in Q1
------------------------------------------------------------
Northern California Bancorp, Inc., filed with the U.S. Securities
and Exchange Commission its quarterly report on Form 10-Q
disclosing net income of $1.06 million on $2.56 million of total
interest income for the three months ended March 31, 2012,
compared with a net loss of $1.45 million on $2.80 million of
total interest income for the same period a year ago.
The Company's balance sheet at March 31, 2012, showed $239.52
million in total assets, $235.43 million in total liabilities and
$4.09 million in total shareholders' equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/xzX0it
About Northern California Bancorp
Monterey, Calif.-based Northern California Bancorp owns 100% of
the stock of Monterey County Bank, Monterey, California, The
Corporation, as a bank holding company, engages in commercial
banking through the Bank.
The Bank is subject to a Consent Order that, among other things,
establishes higher minimum capital requirements than those
established under the prompt corrective action framework. As of
Dec. 31, 2011, the most recent notification from the Federal
Deposit Insurance Corporation (FDIC) categorized the Bank as
adequately capitalized under the regulatory framework for prompt
corrective action. Although the Bank's capital ratios meet the
definition of "well capitalized", the FDIC is permitted, by
regulation, to lower an institution's capital adequacy rating by
one level, if it determines the institution has a higher risk
profile. The Bank received such notification from the FDIC during
2010.
The Company reported a net loss of $13.65 million for 2011,
compared with a net loss of $706,000 for 2010.
NOVA CHEMICAL: Fitch Raises Rating on Sr. Unsecured Debt to 'BB'
----------------------------------------------------------------
Fitch Ratings has upgraded NOVA Chemical Corporation's (NOVA)
Issuer Default Rating (IDR) and its senior unsecured debt ratings
to 'BB' from 'BB-'. The ratings for the senior secured bank
credit facility have been affirmed at 'BB+'. The Rating Outlook
is Positive.
The ratings are based on NOVA's strong operating performance over
the past several quarters and its significantly improved credit
profile following its acquisition by Abu Dhabi-based international
Petroleum Investment Company (IPIC; Fitch IDR 'AA/F1+') in 2009.
NOVA benefits from robust demand and tight supply in its core
Olefins/Polyolefins segment, which mainly produces ethylene and
polyethylene. The resulting favorable pricing environment coupled
with low costs for light, natural gas-based feedstock has resulted
in high operating profits and margins. In the last 12 months
(LTM) to March 31, 2012, NOVA had operating EBITDA of
approximately $1.3 billion, corresponding to a margin of 24.8%,
based on $5.3 billion revenues from continued operations.
The company's performance resulted in significant LTM free cash
flow of $885 million, based on $1,149 million of cash flow from
operations and $252 million of capital expenditures. Fitch
expects NOVA to continue to generate meaningful free cash flow in
2012.
In January 2012, NOVA repaid its $400 million 6.5% notes.
Repayment and stronger operating performance reduced the company's
gross balance sheet debt to EBITDA leverage to 1.1x. Gross
balance sheet debt of $1.4 billion includes $219 million
outstanding balance under the company's accounts receivables
securitization program, which the company now reports on balance
sheet.
The strengthening of the company's credit profile partially
mitigates the key ratings concerns, the underlying price
volatility and the demand and supply cyclicality of commodity
chemicals. Prices for the company's commodity products sold to
third party customers (ethylene, polyethylene, polystyrene and by-
products) are volatile as they follow the cyclicality of the
industry, which is not only influenced by the economic demand
cycle but also by the industry's supply dynamics.
NOVA has minimal short-term debt maturities, but in November 2013
$400 million of floating rate notes mature. Long-term maturities
include the $350 million notes due 2016, $350 million notes due
2019 and $100 million notes due 2025. Fitch expects NOVA to
opportunistically address the 2013 maturity either by refinancing
or repaying the notes with cash on-hand.
The Positive Outlook is based on Fitch's expectation that the
favorable ethylene and polyethylene industry dynamics in North
America will remain in place at least over the next several
quarters. Costs for light feedstock are expected to remain low
and, despite the announced capacity additions, ethylene supply
should remain tight. Fitch expects that NOVA will continue to
generate meaningful profits and cash flows over these quarters as
announced industry capacity additions will come online only
gradually and over an extended period of time.
NOVA has robust liquidity that will enable the company to fund
working capital and capital expenditure requirements and to
withstand less favorable industry conditions, if a reversal of the
positive dynamics were to occur. At March 31, 2012, NOVA had
liquidity of $1,242 million, consisting of $694 million cash on-
hand and $548 million available under its syndicated and bilateral
credit facilities.
NOVA's main $425 million senior secured credit facility, which
matures in December 2015, is governed by a senior-debt-to-cash-
flow covenant of max. 3x and a debt-to- capitalization covenant of
max. 60%. NOVA had ample room under these covenants at March 31,
2012. Fitch expects the company to remain in compliance
throughout the lifetime of the facility. The facility is secured
by the net book value of assets in Canada, including NOVA's
interest in the Joffre, Alberta chemical complex and the Corunna,
Ontario facility. The value of the collateral justifies one notch
rating differential over the IDR and the senior unsecured debt.
In addition, NOVA has $140 million senior unsecured bilateral
revolving credit facilities, which are not governed by the
financial covenants described above. Of these facilities, $40
million expires in September 2013 and $100 million in September
2015. Additional liquidity comes from the company's $225 million
A/R securitization programs, which is governed by the same set of
financial covenants as the $425 million secured facility, and a
$125 million bilateral LC facility.
Catalysts for positive rating actions include continued strong
operating profits and cash flows over the next several quarters as
well as further reductions in leverage levels. Positive rating
actions could also stem from hard (legally enforceable) credit
support from IPIC.
Catalysts for negative rating actions include a dramatic
deterioration of supply/demand balances, particularly against the
backdrop of additional capacity coming online in North America, or
a return to recessionary economic concession, which would reverse
the company's recent operating and financial performance.
Fitch upgrades the following ratings for NOVA:
-- Long-term IDR to 'BB' from 'BB-';
-- Senior unsecured revolving credit facilities to 'BB' from
'BB-';
-- Senior unsecured notes and debentures to 'BB' from 'BB-'.
Fitch affirms the following rating for NOVA:
-- Senior secured revolving credit facility at 'BB+'.
The Rating Outlook is Positive.
NOVASOLAR INC: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: NovaSolar, Inc.
dba NovaSolar Technologies, Inc.
25125 Santa Clara Street, Ste. E, PMB #1
Hayward, CA 94544
Bankruptcy Case No.: 12-54528
Chapter 11 Petition Date: June 15, 2012
Court: United States Bankruptcy Court
Northern District of California (San Jose)
Judge: Charles Novack
Debtor's Counsel: Scott L. Goodsell, Esq.
William J. Healy, Esq.
CAMPEAU, GOODSELL SMITH
440 N. 1st St. #100
San Jose, CA 95112
Tel: (408) 295-9555
E-mail: sgoodsell@campeaulaw.com
whealy@campeaulaw.com
Scheduled Assets: $6,005,000
Scheduled Liabilities: $14,042,355
A copy of the Company's list of its 20 largest unsecured creditors
filed together with the petition is available for free at
http://bankrupt.com/misc/canb12-54528.pdf
The petition was signed by Darien Spencer, CEO.
NUNEZ NORTE: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Nunez Norte, LLC
dba Martin Fierro Argentinean Grill
314 Broadway Street, Unit 1A
Paducah, KY 42001
Bankruptcy Case No.: 12-50527
Chapter 11 Petition Date: June 13, 2012
Court: U.S. Bankruptcy Court
Western District of Kentucky (Paducah)
Debtor's Counsel: Deborah B. Simon, Esq.
SIMON LAW OFFICE
U.S. Bank Building, Suite 607
333 Broadway
Paducah, KY 42001-0720
Tel: (270) 443-0340
Fax: (270) 443-3818
E-mail: dbs@dbsimonlaw.com
Scheduled Assets: $172,907
Scheduled Liabilities: $1,042,585
A copy of the Company's list of its 20 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/kywb12-50527.pdf
The petition was signed by Nestor E. Nunez, sole member.
OMEGA NAVIGATION: Cash Collateral Hearing Continued Until June 18
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas,
according to case docket, continued until June 18, 2012, at 2
p.m., the hearing to consider Omega Navigation Enterprises Inc.,
et al.'s motion to access the cash collateral.
The Court also ordered that the budget as defined in the second
cash collateral order be supplemented and extended to include the
expenses.
As reported in the Troubled Company Reporter on Feb. 10, 2012,
HSH Nordbank AG, as agent, asserts that pursuant to the senior
facilities agreement and the other senior facilities documents,
the Debtors are indebted to the senior facilities lenders in the
principal amount of $242,720,000, plus accrued and accruing
interest and all other amounts.
The junior lenders assert a lien on inter alia, the ships, all
cash collateral and all prepetition collateral pursuant to a
$42,500,000 loan dated March 27, 2008.
The Debtor would use the cash collateral to fund its postpetition
business operations.
As adequate protection from diminution in value of the lenders'
collateral, the Debtors will:
-- make adequate protection payments;
-- grant the lenders adequate protection liens in all of their
rights, title and interest in their property, and a
superpriority administrative expense claim status, subject
to carve out.
-- provide continued maintenance of, and insurance on, the
ships and all of their other assets and property, consistent
with the Debtors' prepetition practices.
About Omega Navigation
Athens, Greece-based Omega Navigation Enterprises Inc. and
affiliates, owner and operator of tankers carrying refined
petroleum products, filed for Chapter 11 protection (Bankr. S.D.
Tex. Lead Case No. 11-35926) on July 8, 2011, in Houston, Texas in
the United States.
Omega is an international provider of marine transportation
services focusing on seaborne transportation of refined petroleum
products. The Debtors disclosed assets of US$527.6 million and
debt totaling US$359.5 million. Together, the Debtors wholly own
a fleet of eight high-specification product tankers, with each
vessel owned by a separate debtor entity.
Judge Karen K. Brown presides over the case. Bracewell &
Giuliani LLP serves as counsel to the Debtors. Jefferies &
Company, Inc., is the financial advisor and investment banker.
The Official Committee of Unsecured Creditors has tapped Winston
& Strawn as local counsel; Jager Smith as lead counsel; and First
International as financial advisor.
ORAGENICS INC: Koski Family Discloses 62.4% Equity Stake
--------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Koski Family Limited Partnership and its
affiliates disclosed that, as of June 5, 2012, they beneficially
own 11,686,342 shares of common stock of Oragenics, Inc.,
representing 62.4% of the shares outstanding. The percentage is
based upon 18,738,145 shares, which includes (i) 12,174,795
Company shares outstanding as of March 31, 2012, (ii) the recent
company issuance of 4,392,425 shares set forth in that certain
Form 8-K filed by the Company on June 11, 2012, and (iii) the KFLP
Warrants. A copy of the filing is available for free at:
http://is.gd/niX7Jq
About Oragenics Inc.
Tampa, Fla.-based Oragenics, Inc. -- http://www.oragenics.com/--
is a biopharmaceutical company focused primarily on oral health
products and novel antibiotics. Within oral health, Oragenics is
developing its pharmaceutical product candidate, SMaRT Replacement
Therapy, and also commercializing its oral probiotic product,
ProBiora3. Within antibiotics, Oragenics is developing a
pharmaceutical candidate, MU1140-S and intends to use its
patented, novel organic chemistry platform to create additional
antibiotics for therapeutic use.
In its audit report for the 2011 financial statements, Mayer
Hoffman McCann P.C., in Clearwater, Florida, expressed substantial
doubt about the Company's ability to continue as a going concern.
The independent auditors noted that the Company has incurred
recurring operating losses, negative operating cash flows and has
an accumulated deficit.
The Company reported a net loss of $7.67 million in 2011, compared
with a net loss of $7.80 million in 2010.
The Company's balance sheet at March 31, 2012, showed
$1.94 million in total assets, $2.25 million in total liabilities,
and a $314,253 total shareholders' deficit.
Bankruptcy Warning
The Company said in its annual report for the year ended Dec. 31,
2011, that its loan agreement with the Koski Family Limited
Partnership matures in three years and select material assets of
the Company relating to or connected with its ProBiora3, SMaRT
Replacement Therapy, MU1140 and LPT3-04 technologies have been
pledged as collateral to secure the Company's borrowings under the
Loan Agreement. This secured indebtedness could impede the
Company from raising the additional equity or debt capital the
Company needs to continue its operations even though the amount
borrowed under the Loan Agreement automatically converts into
equity upon a qualified equity financing of at least $5 million.
The Company's ability to repay the loan will depend largely upon
the Company's future operating performance and the Company cannot
assure that its business will generate sufficient cash flow or
that the Company will be able to raise the additional capital
necessary to repay the loan. If the Company is unable to generate
sufficient cash flow or are otherwise unable to raise the funds
necessary to repay the loan when it becomes due, the KFLP could
institute foreclosure proceedings against the Company's material
intellectual property assets and the Company could be forced into
bankruptcy or liquidation.
PAIRPOINT GLASS: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Pairpoint Glass Company, LLC
fdba PGC Acquisitions, LLC
851 Sandwich Road
Sagamore, MA 02561
Bankruptcy Case No.: 12-15175
Chapter 11 Petition Date: June 15, 2012
Court: United States Bankruptcy Court
District of Massachusetts (Boston)
Judge: William C. Hillman
Debtor's Counsel: Nina M. Parker, Esq.
PARKER & ASSOCIATES
10 Converse Place
Winchester, MA 01890
Tel: (781) 729-0005
Fax: (781) 729-0187
E-mail: nparker@ninaparker.com
Estimated Assets: $500,001 to $1,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 20 largest unsecured creditors
filed together with the petition is available for free at
http://bankrupt.com/misc/mab12-15175.pdf
The petition was signed by Thomas J. Fiocco, manager.
PATHEON: Weak Liquidity No Impact on Moody's 'B3' CFR
-----------------------------------------------------
Moody's Investors Service commented that Patheon's 2QFY12
financial results showed improvement versus the prior year's
quarter, an important development in the company's on-going
turnaround, but liquidity weakened. There is no change to Moody's
B3 Corporate Family Rating, Moody's negative outlook or Moody's
Speculative Grade Liquidity Rating of SGL-3 (adequate liquidity).
Patheon Inc., headquartered in Mississauga, Ontario, Canada, is a
leading provider of commercial manufacturing and pharmaceutical
development services ("PDS") of branded and generic prescription
drugs to the international pharmaceutical industry. Patheon's
stock is publicly traded on the Toronto Stock Exchange, and the
company files with the SEC. JLL Partners, a private equity firm,
owns approximately 56% of the company's restricted voting shares.
For the twelve month period ended April 30, 2012 Patheon reported
revenues of about $690 million.
PDQ COOLIDGE: Court OKs Use of Fannie Mae Cash Collateral
---------------------------------------------------------
PDQ Coolidge Formad LLC and PDQ Coolformad Washores LLC earlier
this month obtained Court authority to continue using cash that
secures the Debtors' obligations to Fannie Mae.
The Debtors were scheduled to return to Court June 13 for a final
hearing on the use of cash collateral.
PDQ Coolidge owns 12 low income residential rental apartment
complexes. Eight of those Properties are encumbered by a first
mortgage held by Fannie Mae and serviced by Greystone Servicing
Corporation, Inc. The four remaining Properties are not
encumbered by Fannie Mae loans, but three of the four Properties
are not presently occupied or operating, in part because of code
enforcement violations by the City of Orlando. Those four
Properties have a combined total of 110 rental units. The
operating Property has six units.
About two weeks into the bankruptcy case, the Debtors filed a
motion seeking to use cash collateral on an emergency basis so
that they can begin using cash collateral for ongoing operations
at their 12 properties and making adequate protection payments to
Fannie Mae in connection with the eight properties which have
collateral rent assignments.
After a preliminary hearing on May 1, the Court issued an interim
order dated May 7 that allowed the Debtors to make all necessary
interim payments of taxes, insurance, utilities, management fees,
maintenance and upkeep of all facilities, buildings, grounds,
parking lots and common areas for the properties, as reflected in
budgets prepared by the Debtors. The Court scheduled the final
hearing on May 24. The Court then issued an order dated June 3
continuing the interim cash use and moving the final hearing to
June 13.
According to court papers filed by the Debtors, the purchases of
the eight encumbered Properties were financed by Fannie Mae with
first mortgages. Each of the encumbered Properties is subject to
a separate Multifamily Note; a Multifamily Mortgage, an Assignment
of Rents and Security Agreement; and other related documents and
security agreements. There are no cross-default or cross-
collateralization provisions as against the other Debtor
Properties.
All of the encumbered Properties are currently under-secured:
Approximate Approximate
Property Value Mortgage Debt
-------- ----------- -------------
Bordeaux Apartments I & II $672,000 $2,105,964
Lakeside Village Apartments $960,000 $2,219,293
Peppertree Circle Apartments $320,000 $675,514
Peppertree Shores $464,000 $577,355
Nichols Apartments $348,000 $857,556
Orange Manor Apartments $384,000 $1,113,662
Southwood Apartments $850,000 $1,814,163
Grassy Pond Apartments $880,000 $1,520,577
On Sept. 26, 2011, Fannie Mae declared the loans to be in default
as a result of (a) the transfer of PDQ Coolidge?s membership
interests to EEF; (b) payment default as of September 2011; and
(c) failure to make deposits for the payment of insurance, taxes
and certain other expenses.
On Nov. 23, 2011 Fannie Mae filed foreclosure actions against PDQ
Coolidge and others in Orange County seeking to foreclose on five
of the eight encumbered Properties (Orange Manor, Nichols,
Lakeside Village, Peppertree Shores and Peppertree Circle) in five
separate actions. On Nov. 28, Fannie Mae filed a separate
foreclosure action in Orange County seeking to foreclose on the
Bordeaux I & II Property. On Dec. 9, Fannie Mae filed separate
foreclosure actions against the Debtor in Duval County seeking to
foreclose on the two remaining Properties, Southwood and Grassy
Pond Manor. No judgment has been entered in any of the
foreclosure actions, and no rent orders have been entered in any
of the actions. No motions for summary judgment have been filed in
any of the foreclosure actions.
About PDQ Coolidge Formad
PDQ Coolidge Formad, LLC, filed a bare-bones Chapter 11 petition
(Bankr. S.D. Fla. Case No. 12-18495) in its home-town in Miami on
April 8, 2012. PDQ Coolidge owns 12 low income residential rental
apartment complexes. The membership interests of PDQ Coolidge are
owned by Education Empowerment Foundation, Inc., a Florida non-
profit corporation. Pursuant to an Asset Management Agreement
with EEF, the Properties are completely managed and operated by
Prestige Enterprise Group, Inc. The principals of Prestige were
also the principals of one of the prior owners, and have all
available knowledge with respect to the ongoing operations of the
Debtor. The principals of Prestige are located in Miami, Florida.
Ten of the Properties are located in Orange County, Florida, and
two are located in Duval County, Florida. All of the Properties
provide affordable housing, and a small number of the total units
provide Section 8 housing.
PDQ Coolidge Formad estimated assets and debts of $10 million to
$50 million. It projects that funds will be available for
distribution to unsecured creditors.
Judge Robert A. Mark presides over the case. Lawyers at Aaronson
Schantz P.A., represent the Debtor.
An affiliate, PDQ Cooformad Washores, LLC, also filed a separate
petition (Bankr. S.D. Fla. Case No. 12-18496), estimating under
$10 million in assets and debts.
The petitions were signed by Salomon Yuken, manager.
PDQ COOLIDGE: Files Schedules of Asset and Liabilities
------------------------------------------------------
PDQ Coolidge Formad, LLC filed with the U.S. Bankruptcy Court for
the Southern District of Florida its schedules of assets and
liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $5,802,000
B. Personal Property $1,358,877
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $11,133,930
E. Creditors Holding
Unsecured Priority
Claims $108,738
F. Creditors Holding
Unsecured Non-priority
Claims $11,599,787
----------- -----------
TOTAL $7,160,877 $22,842,455
PDQ Coolformad Washores, LLC also filed its schedules disclosing
$2,576,028 in assets and $16,754,815 in liabilities.
Full-text copies of the schedules are available for free at:
http://bankrupt.com/misc/PDQ_COOLIDGE_coolformad_sal.pdf
http://bankrupt.com/misc/PDQ_COOLIDGE_sal.pdf
PDQ Coolidge Formad, LLC, filed a bare-bones Chapter 11 petition
(Bankr. S.D. Fla. Case No. 12-18495) in its home-town in Miami on
April 8, 2012. According to myfloridalicense.com, the Debtor is
doing business as Peppertree Shores Apartment and has an Orange,
Florida license to operate apartments.
PDQ Coolidge Formad estimated assets and debts of $10 million to
$50 million. It projects that funds will be available for
distribution to unsecured creditors.
Judge Robert A. Mark presides over the case. Lawyers at Aaronson
Schantz P.A., represent the Debtor.
An affiliate, PDQ Cooformad Washores, LLC, also filed a separate
petition (Bankr. S.D. Fla. Case No. 12-18496), estimating under
$10 million in assets and debts.
The petitions were signed by Salomon Yuken, manager.
The U.S. Trustee said it was not able to appoint a Committee of
Creditors in the Chapter 11 cases of PDQ Coolidge Formad LLC and
PDQ Cooformad Washores LLC.
PET RESORTS: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Pet Resorts, Inc.
1255 West Baseline Road # D-112
Mesa, AZ 85202
Bankruptcy Case No.: 12-13494
Chapter 11 Petition Date: June 15, 2012
Court: United States Bankruptcy Court
District of Arizona (Phoenix)
Judge: George B. Nielsen Jr.
Debtor's Counsel: Stephen E. Traverse, Esq.
BUCKLEY KING LPA
2020 N. Central Ave., #1120
Phoenix, AZ 85004
Tel: (602) 325-1569
Fax: (602) 424-2566
E-mail: traverse@buckleyking.com
Scheduled Assets: $2,300,802
Scheduled Liabilities: $9,500,934
A copy of the Company's list of its 20 largest unsecured creditors
filed together with the petition is available for free at
http://bankrupt.com/misc/azb12-13494.pdf
The petition was signed by Gay L. Barwald, president.
PINNACLE AIRLINES: Maturity of CIT Term Loan Extended to 2014
-------------------------------------------------------------
Pinnacle Airlines Corp., debtor in possession, and its three
operating subsidiaries, Pinnacle Airlines, Inc., Colgan Air, Inc.
and Mesaba Aviation, Inc., entered into an Amended and Restated
Credit Agreement with CIT Bank, as lender, the other lenders party
thereto from time to time, the loan parties party thereto from
time to time and C.I.T. Leasing Corporation, as administrative
agent and collateral agent. The Agreement was approved by the
United States Bankruptcy Court for the Southern District of New
York on May 11, 2012. The Agreement modifies a Third Amendment to
Credit Agreement dated June 24, 2011, pursuant to which CIT Bank
increased its loan to the companies to $37 million.
Pursuant to the terms of the Agreement, the material terms of Term
Loan were modified as follows:
1. The maturity date of the Term Loan was changed to June 30,
2014;
2. The interest rate of the Term Loan was converted from a
combination of a floating and fixed rate obligation to an
entirely fixed interest rate of 8.5%;
3. The minimum liquidity covenant in the Agreement was changed
from $40 million to the greater of $20 million and the
amount of liquidity required to be maintained by the Company
pursuant to any debtor in possession financing facility in
the Company's Chapter 11 proceeding; and
4. The limitations in the Term Loan related to the borrowers'
ability to sell collateral with the consent of C.I.T.
Leasing have been amended to allow the borrowers to sell an
unlimited amount of consumable/expendable spare parts,
rotable spare parts and spare engines relating to Saab 340
and Bombardier Q400 aircraft without the consent of C.I.T.
Leasing, so long as the net sales proceeds from the sale are
used to repay the Term Loan.
About Pinnacle Airlines
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.
Pinnacle Airlines Inc. and its affiliates, including Colgan Air,
Mesaba Aviation Inc., Pinnacle Airlines Corp., and Pinnacle East
Coast Operations Inc. filed for Chapter 11 bankruptcy (Bankr.
S.D.N.Y. Lead Case No. 12-11343) on April 1, 2012.
Judge Robert E. Gerber presides over the case. Lawyers at Davis
Polk & Wardwell LLP, and Akin Gump Strauss Hauer & Feld LLP serve
as the Debtors' counsel. Barclays Capital and Seabury Group LLC
serve as the Debtors' financial advisors. Epiq Systems -
Bankruptcy Solutions serves as the claims and noticing agent. The
petition was signed by John Spanjers, executive vice president and
chief operating officer.
Pinnacle Airlines' 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.
Delta Air Lines, Inc., the Debtors' major customer and post-
petition lender, is represented by David R. Seligman, Esq., at
Kirkland & Ellis LLP.
A seven-member official committee of unsecured creditors has been
appointed in the case. The Committee selected Goodrich
Corporation as its chairperson. The Committee tapped Morrison &
Foerster LLP as its counsel.
QUALTEQ INC: Court Appoints Fred C. Caruso as Ch. 11 Trustee
------------------------------------------------------------
The Hon. Eugene R. Wedoff of the U.S. Bankruptcy Court for the
Northern District of Illinois approved the appointment of Fred C.
Caruso as Chapter 11 trustee for Qualteq, Inc., et al.
On May 4, 2012, the Court granted Bank of America, N.A.'s motion
for appointment of trustee and directed the U.S. Trustee to
appoint a Chapter 11 Trustee in the case of the Debtors.
According to BofA, a trustee is needed in the Debtors' cases
because, among other things:
-- to investigate and determine the validity of insider claims
purportedly worth millions: Oakbrook Financial has nearly $5.5
million in claims; undocumented intercompany loans total about
$19.5 million; two Debtors supposedly owe Arun $320,000; Veluchamy
relatives have filed claims of more than $2.6 million; and several
entities owned by the Veluchamy family have been scheduled as
holding claims as well;
-- the Debtors pursued, and continue to pursue, nonconfirmable
plans (and premature, onerous exit financing) that benefit
insiders and violate the automatic stay in the Chapter 7 cases,
which has wasted months of time and large amounts of money;
-- the Debtors wasted much time and money in a fruitless effort
to keep these cases in Delaware, when (as the Delaware court
found) the cases must have been filed in Illinois to begin with;
and
-- notwithstanding the alleged supervision of a chief
restructuring officer, the Debtors kept critical information about
their businesses secret because of long delays in filing required
monthly operating reports.
Patrick S. Layng, the U.S. Trustee instructed Mr. Caruso to file a
bond in favor of the United States in the penal amount of $20,000
to monitor the level of bond coverage and to increase that
coverage as needed.
About QualTeq Inc.
South Plainfield, New Jersey-based QualTeq, Inc., engages in the
design, manufacture, and personalization of plastic cards in the
United States. The company manufactures magnetic, contact, and
dual interface smart cards.
Qualteq Inc. and 17 affiliated companies filed for Chapter 11
bankruptcy protection (Bankr. D. Del. Lead Case No. 11-12572) on
Aug. 14, 2011. Eric Michael Sutty, Esq., and Jeffrey M. Schlerf,
Esq., at Fox Rothschild LLP, serve as local counsel to the
Debtors. K&L Gates LLP is the general bankruptcy counsel.
Eisneramper LLP is the accountants and financial advisors.
Scouler & Company is the restructuring advisors. Lowenstein
Sandler PC is counsel to the Committee. Avadamma LLC disclosed
$38,491,767 in assets and $36,190,943 in liabilities as of the
Petition Date.
As reported in the Troubled Company Reporter on Feb. 23, 2012,
Bankruptcy Judge Kevin J. Carey in Delaware granted the request of
Bank of America, N.A., to transfer the venue of the Chapter 11
cases of Qualteq, Inc., et al., to the U.S. Bankruptcy Court for
the Northern District of Illinois.
Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed four
unsecured creditors to serve on the Official Committee of
Unsecured Creditors.
REDDY ICE: Court OKs Wylie Suit to Proceed Despite Plan Injunction
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Bankruptcy Court for the
Northern District of Texas signed a stipulation and order
modifying Reddy Ice Holdings, Inc., and Reddy Ice Corporation's
Chapter 11 Plan injunction.
As reported in the Troubled Company Reporter on May 23, 2012,
prior to the Petition Date, Earl Wylie alleged that he was an
accounts payable clerk for Debtor Reddy Ice Corporation from
May 16, 2008, until June 14, 2011, when he was terminated. On
Jan. 27, 2012, Mr. Wylie filed suit against Reddy Ice Corporation
alleging age discrimination, disability discrimination, and
violations under the Family Medical Leave Act, styled Earl W.
Wylie v. Reddy Ice Corporation; in the U.S. District Court,
Northern District of Texas, Dallas Division.
The Plan provides for an injunction against parties initiating or
continuing legal proceedings against the Debtors post-
confirmation.
The parties stipulate to modify the injunction so as to permit
Mr. Wylie to continue the lawsuit for the purpose of pursuing
recovery of insurance proceeds from any applicable policy covering
Mr. Wylie's claims.
Pursuant to the stipulation, among other things:
1. The lawsuit is excepted from the injunction, and the lawsuit
may proceed notwithstanding any injunctions in the Plan;
2. Mr. Wylie will first seek recovery on the claims asserted in
the lawsuit only from applicable insurance policies or
proceeds from the policies. Only in the event, and to the
extent that, the claims asserted in the lawsuit are not
covered by any insurance policies, the claims will be
classified and administered as a claim under class 8A.
3. The parties are authorized to enter into any related or
ancillary agreements necessary or required to effectuate the
stipulation without obtaining Court approval of the related
or ancillary agreements.
About Reddy Ice
Reddy Ice Holdings Inc. and wholly owned subsidiary Reddy Ice
Corp. manufacture and distribute packaged ice in the United
States. As of Dec. 31, 2011, the Company had assets totaling
$434 million and total liabilities of $531 million. The bulk of
the liabilities were total debt outstanding of $471.5 million.
Reddy Holdings and Reddy Corp. on April 12, 2012, filed voluntary
Chapter 11 bankruptcy petitions (Bankr. N.D. Tex. Case Nos. 12-
32349 and 12-32350) together with a plan of reorganization and
accompanying disclosure statement to complete a previously
announced plan to strengthen its balance sheet and ensure strong
financial footing for the future. As part of the restructuring,
Reddy Ice seeks to pursue a strategic acquisition of all or
substantially all of the businesses and assets of Arctic Glacier
Income Fund and its subsidiaries, including Arctic Glacier Inc., a
major producer, marketer and distributor of packaged ice in North
America.
Arctic Glacier on Feb. 22, 2012, filed for protection under the
Companies' Creditors Arrangement Act in Canada and Chapter 15 of
the Bankruptcy Code in the United States. Arctic is seeking sale
or investment proposals from qualified bidders.
Judge Stacey G. Jernigan presides over the case. Reddy Ice's
financial advisors are Jefferies & Company, Inc. and FTI
Consulting, Inc. Kurtzman Carson Consultants serves as claims and
notice agent.
Centerbridge Partners is represented by Jonathan S. Zinman, Esq.,
Joshua A. Sussberg, Esq., James H.M. Sprayregen, Esq., and Anup
Sathy, Esq., at Kirkland & Ellis.
Macquarie Bank Limited is represented by Sarah Hiltz Seewer, Esq.,
and David R. Seligman, Esq., also at Kirkland & Ellis.
The ad hoc group of First Lien and Second Lien Noteholders is
represented by Joshua Andrew Feltman, Esq., at Wachtell Lipton
Rosen & Katz. Wells Fargo Bank, National Association, serves as
First Lien and Second Lien Agent.
Reddy Ice emerged from Chapter 11 protection at the end of May
2012. The plan reduced debt by $145 million and gave ownership of
the company to affiliates of Centerbridge Partners.
RG STEEL: Trade Suppliers, PBGC, Steelworkers on Committee
----------------------------------------------------------
Pursuant to Section 1102(a)(1) of the Bankruptcy Code, Roberta A.
DeAngelis, the U.S. Trustee for Region 3, appointed seven members
to the Committee of Unsecured Creditors in the Chapter 11 cases of
RG Steel LLC, WP Steel Venture LLC, and their affiliated debtors:
1. Cliffs Natural Resources Inc.
Attn: Matthew Zajac
1100 Superior Avenue
Cleveland OH 44114
Tel: 216-694-5260
Fax: 216-694-5385
2. Metal Services, LLC
dba Phoenix Services LLC
Attn: John Hilbert
148 W. State Street, Suite 801
Kennett Square PA 19348
Tel: 610-347-0444
Fax: 610-347-0443
3. Siemens Industry Inc.
Attn: Alan Helgerman & Darryl Peake
501 Technology Drive, Suite 1000
Cannonsburg PA 15317
Tel: 724-514-8453
Fax: 724-514-8401
4. United Steelworkers
Attn: David Jury
Five Gateway Center, Room 807
Pittsburgh PA 15222
Tel: 412-562-2545
Fax: 412-562-2574
5. Pension Benefit Guaranty Corporation
Attn: Jack Butler
1200 K Street, N.W.
Washington DC 20005
Tel: 202-326-4000 ext. 3471
Fax: 202-842-2643
6. Mingo Junction Energy Center, LLC
Attn: Thomas Shepard
444 North Michigan Avenue, Suite 1200
Chicago IL 60611
Tel: 312-327-1112
Fax: 312-327-1101
7. Balli Steel PLC and Balli Group PLC
Attn: Britt Gustawsson
5 Stanhope Gate
London W1K 1AH, United Kingdom
Tel: 44-207-306-2000
Fax: 44-207-306-2000
Bill Rochelle, the bankruptcy columnist for Bloomberg News, notes
the committee has five suppliers along with the United
Steelworkers' union and the Pension Benefit Guaranty Corp.
The Committee's proposed bankruptcy counsel are:
Mark Minuti, Esq.
Teresa K.D. Currier, Esq.
Lucian B. Murley, Esq.
SAUL EWING LLP
222 Delaware Avenue, Suite 1200
P.O. Box 1266
Wilmington, DE 19899
Telephone: (302) 421-6840
Facsimile: (302) 421-5873
E-mail: mminuti@.saul.com
tcurrier@saul.com
lmurley@saul.com
- and -
Thomas M. Mayer, Esq.
Robert T. Schmidt, Esq.
Gregory A. Horowitz, Esq.
Joshua K. Brody, Esq.
Gregory G. Plotko, Esq.
KRAMER LEVIN NAFTALIS & FRANKEL LLP
1177 Avenue of Americas
New York, NY 10036
Telephone: (212) 715-9571
Facsimile: (212) 715-7571
E-mail: tmayer@kramerlevin.com
rschmidt@kramerlevin.com
ghorowitz@kramerlevin.com
jbrody@kramerlevin.com
gplotko@kramerlevin.com
About RG Steel
RG Steel LLC -- http://www.rg-steel.com/-- is the United States'
fourth-largest flat-rolled steel producer with annual steelmaking
capacity of 7.5 million tons. It was formed in March 2011
following the purchase of three steel facilities located in
Sparrows Point, Maryland; Wheeling, West Virginia and Warren,
Ohio, from entities related to Severstal US Holdings LLC. RG
Steel also owns finishing facilities in Yorkville and Martins
Ferry, Ohio. It also owns Wheeling Corrugating Company and has a
50% ownership in Mountain State Carbon and Ohio Coatings Company.
RG Steel along with affiliates, including WP Steel Venture LLC,
sought bankruptcy protection (Bankr. D. Del. Lead Case No. 12-
11661) on May 31, 2012, to pursue a sale of the business. The
bankruptcy was precipitated by liquidity shortfall and a dispute
with Mountain State Carbon, LLC, and a Severstal affiliate, that
restricted the shipment of coke used in the steel production
process.
The Debtors estimated assets and debts in excess of $1 billion as
of the Chapter 11 filing. The Debtors owe (i) $440 million,
including $16.9 million in outstanding letters of credit, to
senior lenders led by Wells Fargo Capital Finance, LLC, as
administrative agent, (ii) $218.7 million to junior lenders, led
by Cerberus Business Finance, LLC, as agent, (iii) $130.5 million
on account of a subordinated promissory note issued by majority
owner The Renco Group, Inc., and (iv) $100 million on a secured
promissory note issued by Severstal.
Judge Kevin J. Carey presides over the case.
The Debtors are represented in the case by Robert J. Dehney, Esq.,
and Erin R. Fay, Esq., at Morris, Nichols, Arsht & Tunnell LLP,
and Matthew A. Feldman, Esq., Shaunna D. Jones, Esq., Weston T.
Eguchi, Esq., at Willkie Farr & Gallagher LLP, represent the
Debtors.
Conway MacKenzie, Inc., serves as the Debtors' financial advisor
and The Seaport Group serves as lead investment banker. Donald
MacKenzie of Conway MacKenzie, Inc., as CRO. Kurtzman Carson
Consultants LLC is the claims and notice agent.
Wells Fargo Capital Finance LLC, as Administrative Agent, is
represented by Jonathan N. Helfat, Esq., and Daniel F. Fiorillo,
Esq., at Otterbourg, Steindler, Houston & Rosen, P.C.; and Laura
Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachuiski Stang
Ziehi & Jones LLP.
Renco Group is represented by lawyers at Cadwalader, Wickersham &
Taft LLP.
ROCK POINTE: Southwell & O'Rourke Approved as Bankruptcy Counsel
----------------------------------------------------------------
The Hon. Frank L. Kurtz of the U.S. Bankruptcy Court for the
Eastern District of Washington authorized Rock Pointe Holdings
Company, LLC, to employ Southwell & O'Rourke, P.S., as counsel.
As reported in the Troubled Company Reporter on Jan. 4, 2012, the
Debtor needed the firm's representation to prepare a confirmable
Chapter 11 plan and deal with issues relating thereto.
Dan O'Rourke will be paid $385 per hour and Kevin O'Rourke will be
paid $300 per hour, plus reimbursement of actual expenses.
To the best of the Debtor's knowledge Southwell & O'Rourke does
not hold or represent an interest adverse to the estate.
About Rock Pointe Holdings Company LLC
Rock Pointe Holdings Company LLC owns the Rock Pointe Corporate
Center in Spokane, Washington. The Company filed for Chapter 11
protection (Bankr. E.D. Wash. Case No.11-05811) on Dec. 2, 2011.
Brett L. Wittner, Esq., at Kent & Wittner PS, represents the
Debtor. The Debtor estimated both assets and debts of between
$50 million and $100 million.
The U.S. Trustee said an official committee has not been appointed
in the bankruptcy case of Rock Pointe Holdings Company LLC because
an insufficient number of persons holding unsecured claims against
the Debtor have expressed interest in serving on a committee. The
U.S. Trustee reserves the right to appoint such a committee should
interest developed among the creditors.
ROOMSTORE INC: Gets OK to Place Remaining Stores on the Block
-------------------------------------------------------------
Rachel Feintzeig at DBR Small Cap reports that RoomStore Inc.
received clearance to place its remaining 28 furniture stores on
the auction block after spending months liquidating the weakest
parts of its business.
About RoomStore Inc.
Richmond, Virginia-based RoomStore, Inc., operates retail
furniture stores and offers home furnishings through
Furniture.com, a provider of Internet-based sales opportunities
for regional furniture retailers. RoomStore was founded in 1992
in Dallas, Texas, with four retail furniture stores. With more
than $300 million in net sales for its fiscal year ending 2010,
RoomStore was one of the 30 largest furniture retailers in the
United States.
RoomStore filed for Chapter 11 bankruptcy (Bankr. E.D. Va. Case
No. 11-37790) on Dec. 12, 2011, following store-closing sales at
four of its retail stores, located in Hoover, Alabama;
Fayetteville, North Carolina; Tallahassee, Florida; and Baltimore,
Maryland. When it filed for bankruptcy, the Company operated a
chain of 64 retail furniture stores, including both large-format
stores and clearance centers in eight states: Pennsylvania,
Maryland, Virginia, North Carolina, South Carolina, Florida,
Alabama, and Texas. It also had five warehouses and distribution
centers located in Maryland, North Carolina, and Texas that
service the Retail Stores.
RoomStore also owns 65% of Mattress Discounters Group LLC, which
operates 83 mattress stores (as of Aug. 31, 2011) in the states of
Delaware, Maryland and Virginia and in the District of Columbia.
RoomStore acquired the Mattress Discounters stake after it filed
its second bankruptcy in 2008. Mattress Discounters sought
Chapter 11 relief on Sept. 10, 2008 (Bankr. D. Md. Case Nos.
08-21642 and 08-21644). It filed the first Chapter 11 bankruptcy
on Oct. 23, 2002 (Bankr. D. Md. Case No. 02-22330), and emerged on
March 14, 2003.
Judge Douglas O. Tice, Jr., presides over RoomStore's case.
Lawyers at Lowenstein Sandler PC and Kaplan & Frank, PLC serve as
the Debtor's bankruptcy counsel. FTI Consulting, Inc., serves as
the Debtor's financial advisors and consultants.
RoomStore's balance sheet at Aug. 31, 2011, showed $70.4 million
in total assets, $60.3 million in total liabilities, and
stockholders' equity of $10.1 million. The petition was signed by
Stephen Girodano, president and chief executive officer.
Liquidator Hilco Merchant Resources, Inc., is represented in the
case by Gregg M. Galardi, Esq., at DLA Piper LLP (US); and Robert
S. Westermann, Esq., and Sheila de la Cruz, Esq., at Hirschler
Fleischer, P.C.
The U.S. Trustee for Region 4 named seven members to the official
committee of unsecured creditors in the case.
ROSETTA GENOMICS: Perkins Capital Owns 15,767 Common Shares
-----------------------------------------------------------
In an amended Schedule 13G filing with the U.S. Securities and
Exchange Commission, Perkins Capital Management, Inc., disclosed
that, as of May 31, 2012, it beneficially owns 15,767 common
shares of Rosetta Genomics, Ltd, representing 0.1% of the shares
outstanding. A copy of the filing is available for free at:
http://is.gd/gPFfyn
About Rosetta
Located in Rehovot, Israel, Rosetta Genomics Ltd. is seeking to
develop and commercialize new diagnostic tests based on a recently
discovered group of genes known as microRNAs. MicroRNAs are
naturally expressed, or produced, using instructions encoded in
DNA and are believed to play an important role in normal function
and in various pathologies. The Company has established a CLIA-
certified laboratory in Philadelphia, which enables the Company to
develop, validate and commercialize its own diagnostic tests
applying its microRNA technology.
In its auditors' report for the 2011 financial statements, Kost
Forer Gabbay & Kasierer, in Tel-Aviv, Israel, expressed
substantial doubt about Rosetta Genomics' ability to continue as a
going concern. The independent auditors noted that the Company
has incurred recurring operating losses and generated negative
cash flows from operating activities in each of the three years in
the period ended Dec. 31, 2011.
The Company reported a net loss after discontinued operations of
$8.83 million on $103,000 of revenues for 2011, compared with a
net loss after discontinued operations of $14.76 million on
$279,000 of revenues for 2010.
The Company's balance sheet at Dec. 31, 2011, showed $2.04 million
in total assets, $2.40 million in total liabilities, and a
stockholders' deficit of $356,000.
Bankruptcy Warning
The Company said in its annual report for the year ended Dec. 31,
2011, "We have used substantial funds to discover, develop and
protect our microRNA tests and technologies and will require
substantial additional funds to continue our operations. Based on
our current operations, our existing funds, including the proceeds
from the January 2012 debt financing, will only be sufficient to
fund operations until late May, 2012. We intend to seek funding
through collaborative arrangements and public or private equity
offerings and debt financings. Additional funds may not be
available to us when needed on acceptable terms, or at all. In
addition, the terms of any financing may adversely affect the
holdings or the rights of our existing shareholders. For example,
if we raise additional funds by issuing equity securities, further
dilution to our then-existing shareholders may result. Debt
financing, if available, may involve restrictive covenants that
could limit our flexibility in conducting future business
activities. If we are unable to obtain funding on a timely basis,
we may be required to significantly curtail one or more of our
research or development programs. We also could be required to
seek funds through arrangements with collaborators or others that
may require us to relinquish rights to some of our technologies,
tests or products in development or approved tests or products
that we would otherwise pursue on our own. Our failure to raise
capital when needed will materially harm our business, financial
condition and results of operations, and may require us to seek
protection under the bankruptcy laws of Israel and the United
States.
S. WHITE TRANSPORTATION: Objected Mortgage Survives Chapter 11
--------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that a June 14 opinion by U.S. District Judge Halil
Suleyman Ozerden in Jackson, Mississippi, said that merely stating
in a Chapter 11 plan that a secured claim is disputed is
insufficient to bar the lender from enforcing the secured claim
after confirmation of a Chapter 11 plan.
The report relates that the case involved a company in Chapter 11
with a first mortgage of about $100,000. The lender never filed a
proof of claim. The Chapter 11 plan stated that the claim was
disputed and that the time for filing claims had expired. After
the plan was confirmed, the creditors filed a lawsuit in
bankruptcy court seeking a declaration that the secured claim
survived. The bankruptcy judge ruled that it didn't, and Ozerden
reversed in a 13-page opinion.
Mr. Rochelle relates that Judge Ozerden started with the general
proposition that secured claims ride through bankruptcy. He then
cited a 2007 case from the U.S. Court of Appeals in New Orleans
called Ahern which established four conditions to be met before a
secured debt is extinguished. It was conceded that the plan was
confirmed, the lien was dealt with in the plan, and the plan
extinguished the lien.
According to the report, there was dispute over the fourth
requirement, whether the creditors participated in the
reorganization. Because it was undisputed that the creditor knew
about the bankruptcy, the bankrupt argued unsuccessfully that
notice by itself satisfied the participation required. Judge
Ozerden disagreed. The "weight of persuasive authority supports
the conclusion that more than the receipt of mere notice is
necessary" to satisfy Ahern, he said.
According to Judge Ozerden, "something more was required." To
satisfy the last requirement, the judge said the bankrupt could
have filed a claim on behalf of the creditor and objected to the
claim.
The case is Acceptance Loan Co. v. S. White Transportation
Inc. (In re S. White Transportation Inc.), 11-368, U.S. District
Court, Southern District of Mississippi (Jackson).
A copy of the Court's June 14 Memorandum Opinion and Order is
available at http://is.gd/htj1lafrom Leagle.com.
S. White Transportation, Inc., filed for Chapter 11 bankruptcy
(Bankr. S.D. Miss. Case No. 10-51137) on May 17, 2010. A plan was
confirmed in the Debtor's case on Dec. 21, 2010.
SADLER CLINIC: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Sadler Clinic, PLLC
690 South Loop, 336 West
Conroe, TX 77304
Bankruptcy Case No.: 12-34546
Affiliate that filed separate Chapter 11 petition:
Debtor Case No.
------ --------
Montgomery County Management Company, LLC 12-34547
Chapter 11 Petition Date: June 15, 2012
Court: United States Bankruptcy Court
Southern District of Texas (Houston)
Judge: Marvin Isgur
About the Debtors: The Debtors operate a multi specialty
physician clinic known as Sadler Clinic.
Sadler Clinic was founded in 1958 by Dr. Deane
Sadler, Dr. Irving Watson and Dr. Walter
Wilkerson. Sadler Clinic grew steadily through
the years. At its peak in 2010, Sadler Clinic
had 13 locations, over 100 providers, and a
staff of more than 600 healthcare
professionals. In 2010, the Debtors' annual
revenue exceeded $250,000,000.
Debtors' Counsel: Jason M. Rudd, Esq.
Kyung Shik Lee, Esq.
DIAMOND MCCARTHY LLP
909 Fannin, Suite 1500
Houston, TX 77010
Tel: (713) 333-5100
Fax: (713) 333-5195
E-mail: jrudd@diamondmccarthy.com
klee@diamondmccarthy.com
Sadler Clinic's
Estimated Assets: $1,000,001 to $10,000,000
Sadler Clinic's
Estimated Debts: $10,000,001 to $50,000,000
A copy of the Sadler Clinic and Montgomery County's list of their
20 largest unsecured creditors is available for free at
http://bankrupt.com/misc/txsb12-34546.pdf
The petitions were signed by Leslie Schoppe, M.D., member of the
board of managers for Sadler Clinic, PLLC.
SAFE TRAFFIC: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Safe Traffic System, Inc.
10201 Pacific Avenue
Franklin Park, IL 60131
Bankruptcy Case No.: 12-24273
Chapter 11 Petition Date: June 15, 2012
Court: United States Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Janet S. Baer
Debtor's Counsel: Paul M. Bach, Esq.
BACH LAW OFFICES
P.O. Box 1285
Northbrook, IL 60065
Tel: (847) 564-0808
Fax: (847) 564-0985
E-mail: paul@bachoffices.com
Estimated Assets: $100,001 to $500,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 20 largest unsecured creditors
filed together with the petition is available for free at
http://bankrupt.com/misc/ilnb12-24273.pdf
The petition was signed by Hoon Y. Kim, president.
SALUTARIS DIALYSIS: Case Summary & 14 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Salutaris Dialysis & Nephrology Center
Hospital Menonita De Caguas
Carr 172
Turabo Gardens
Caguas, PR 00725
Bankruptcy Case No.: 12-04675
Chapter 11 Petition Date: June 15, 2012
Court: United States Bankruptcy Court
District of Puerto Rico (Old San Juan)
Debtor's Counsel: Carlos Rodriguez Quesada, Esq.
LAW OFFICE OF CARLOS RODRIGUEZ QUESADA
P.O. Box 9023115
San Juan, PR 00902-3115
Tel: (787) 724-2867
E-mail: cerqlaw@coqui.net
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 14 largest unsecured creditors
filed together with the petition is available for free at
http://bankrupt.com/misc/prb12-04675.pdf
The petition was signed by Shakil Shafique, secretary.
Affiliate that filed separate Chapter 11 petition:
Petition
Debtor Case No. Date
------ -------- ----
San Juan Bautista Medical 11-02270 03/18/11
Center Corp.
SB PARTNERS: Incurs $1 Million Net Loss in 2011
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SB Partners filed with the U.S. Securities and Exchange Commission
its annual report on Form 10-K disclosing a net loss of $1.02
million on $2.50 million of total revenues in 2011, a net loss of
$623,117 on $2.61 million of total revenues in 2010, and a net
loss of $23.60 million on $2.58 million of total revenues in 2009.
The Company's balance sheet at Dec. 31, 2011, showed $18.20
million in total assets, $20.89 million in total liabilities and a
$2.69 million total partners' deficit.
A copy of the Form 10-K is available for free at:
http://is.gd/mwVWYH
About SB Partners
Milford, Conn.-based SB Partners is a New York limited partnership
engaged in acquiring, operating and holding for investment a
varying portfolio of real estate interests. As of June 30,
2010, the partnership owns an industrial flex property in Maple
Grove, Minnesota and warehouse distribution centers in Lino Lakes,
Minnesota and Naperville, Illinois.
The Company has a 30% interest in Sentinel Omaha, LLC. Sentinel
Omaha is a real estate investment company which currently owns 24
multifamily properties and 1 industrial property in 17 markets.
Sentinel Omaha is an affiliate of the partnership's general
partner.
SEQUOIA PARTNERS: Gets OK to Obtain Loan for Property Appraisal
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The Hon. Frank R. Alley of the U.S. Bankruptcy Court for the
District of Oregon authorized Sequoia Partners, LLC and Sequoia
Village, LLC, to obtain postpetition credit.
The Court also ordered that the DIP Loan proceeds will be used
exclusively for the cost of obtaining an appraisal on the Debtor's
real property; and the total amount charged by Debtor's appraiser
will not exceed the DIP Loan of $30,000.
The Court further ordered that the Debtor is authorized to treat
the DIP Loan as either (i) a credit against the purchase price the
lender will pay for the property assuming it purchases the
property under the Debtor's proposed plan; or (ii) secured by
trust deeds on Lots 7, 134 and 140 of the Debtor's real property
junior to current liens with the trust deeds to be conveyed upon
entry of the order.
Previously, Robert D. Miller, Jr., the U.S. Trustee, asked the
Court to deny the Debtors' motion for authorization to obtain
postpetition credit.
According to the Trustee,
1. The Debtor did not disclose, in the motion, the terms under
which the postpetition credit is to be repaid (e.g. interest rate,
frequency and amount of payments, and the length of time that will
be allowed for repayment).
2. Except for the Debtor's assertion that the proposed
appraiser requires a $30,000 retainer, the Debtor has not
established that it is unable to obtain unsecured credit allowable
under Section 503(b)(1) of the Bankruptcy Code.
About Sequoia Partners, LLC
Grants Pass, Oregon-based Sequoia Partners, LLC, filed for Chapter
11 bankruptcy protection (Bankr. D. Ore. Case No. 10-67547) on
Dec. 29, 2010. Tara J. Schleicher, Esq., at Farleigh Wada Witt
Attorneys, serves as the Debtor's bankruptcy counsel. Beowulf
Consulting, LLC, serves as accountant. CPM Real Estate Services,
Inc., serves as loan broker. The Debtor estimated assets at $50
million to $100 million and debts at $10 million to
$50 million.
Robert D. Miller, Jr., U.S. Trustee for Region 18, appointed five
members to the official committee of unsecured creditors. The
Committee tapped Douglas R. Schultz and Cassie K. Jones and the
law firm of Gleaves Swearingen Potter & Scott LLP as its counsel.
SHARED MARKETING: Case Summary & 20 Largest Unsecured Creditors
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Debtor: Shared Marketing Services, Inc.
c/o Reed Smith LLP
10 S. Wacker Drive, 40th Flr.
Chicago, IL 60606
Bankruptcy Case No.: 12-24275
Chapter 11 Petition Date: June 15, 2012
Court: United States Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Jack B. Schmetterer
Debtor's Counsel: Stephen T. Bobo, Esq.
REED SMITH LLP
10 South Wacker Drive, Suite 4000
Chicago, IL 60606
Tel: (312) 207-6480
Fax: (312) 207-6400
E-mail: sbobo@reedsmith.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 20 largest unsecured creditors
filed together with the petition is available for free at
http://bankrupt.com/misc/ilnb12-24275.pdf
The petition was signed by Rick Lattanzie, president and CEO.
SHERIDAN HOLDINGS: Moody's Rates $670MM Credit Facilities 'B1'
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Moody's Investors Service assigned a B1 rating to Sheridan
Holdings, Inc.'s proposed $670 million senior secured first lien
credit facilities, consisting of a $100 million revolver expiring
2017 and a $570 million first lien term loan due 2018. In
addition, Moody assigned a Caa1 rating to the proposed $140
million second lien term loan due 2019. Sheridan's B2 Corporate
Family and Probability of Default Ratings remain unchanged. The
outlook is stable. Ratings for existing credit facilities will be
withdrawn when the new facilities close.
Moody's understands that the proceeds from the new credit
facilities will be used to refinance the existing debt and cover
fees and expenses associated with the refinancing.
Following is a summary of Moody's ratings actions for Sheridan
Holdings, Inc.:
Ratings assigned:
$100 million first lien revolver expiring 2017 at B1 (LGD 3, 40%)
$570 million first lien term loan due 2018 at B1 (LGD 3, 40%)
$140 million second lien term loan due 2019 at Caa1 (LGD 6, 91%)
Ratings unchanged:
Corporate Family Rating at B2
Probability of Default Rating at B2
Ratings to be withdrawn upon completion of the refinancing:
First lien revolving credit facility at B1 (LGD 3, 40%)
First lien term loan at B1 (LGD 3, 40%)
Second lien PIK term loan at Caa1 (LGD 6, 91%)
Ratings Rationale
Sheridan's B2 Corporate Family Rating reflects the company's
moderately high financial leverage -- with debt used to fund
acquisitions and its LBO. The rating is also constrained by the
considerable concentration of business in the Florida market and
the company's modest size compared to similarly rated competitors.
The rating benefits from Sheridan's solid cash flow and Moody's
expectation for improved credit metrics over the next year.
The stable rating outlook reflects Moody's expectation that the
company will continue to invest in growing its presence in its
existing markets while focusing on maintaining and expanding
margins. This will likely result in the continuation of moderately
high leverage. The outlook also incorporates Moody's expectation
that the company will maintain a disciplined approach to
acquisitions.
Given the high leverage, Moody's does not anticipate an upgrade in
the near-term. However, Moody's could upgrade the rating if the
company continues to grow its revenue size and diversify its
revenue sources, while repaying debt. More specifically, there
could be upward ratings pressure if total debt to EBITDA falls to
the low 4 times range and adjusted free cash flow to adjusted debt
rises above 8%, each on a sustainable basis.
The ratings could be downgraded if the company makes a debt-funded
acquisition which materially increases leverage, for example if
adjusted cash flow from operations to adjusted debt is likely to
be sustained at levels below 5%.
Headquartered in Sunrise, Florida, Sheridan Healthcare, Inc. (a
wholly owned subsidiary of Sheridan Holdings, Inc.) is a leading
provider of physician services to hospitals and ambulatory
surgical facilities. The company provides outsourced physician
staffing services for anesthesia, neonatology, radiology,
pediatrics and emergency departments. Sheridan also provides a
full complement of professional and administrative support
services including physician billing. Sheridan is owned by private
equity sponsor Hellman & Friedman LLC. The company generated net
revenue (before provisions for bad debt) of $835 million for the
twelve months ended March 31, 2012.
The principal methodologies used in rating Sheridan Holdings, Inc.
were Global Business & Consumer Service Industry published in
October 2010, and Loss Given Default for Speculative-Grade Non-
Financial Companies in the U.S., Canada and EMEA published in June
2009.
SHOREBANK CORP.: Wins Confirmation of Chapter 11 Plan
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Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the U.S. Bankruptcy Court in Chicago signed a
confirmation order on June 13 approving the plan for ShoreBank
Corp. The disclosure statement explaining the plan stated that
unsecured creditors should have a 20% recovery on their $3.9
million in claims.
According to the report, ShoreBank used bankruptcy to implement an
agreement worked out in advance where the Federal Deposit
Insurance Corp. receives $8.5 million from a $10.7 million tax
refund. The bank holding company expects there will eventually be
$11 million for distribution to creditors. Because holders of
subordinated notes are to receive nothing for their $37.6 million
in claims, senior creditors with claims totaling $12.3 million are
predicted to have an 83% recovery.
About ShoreBank
Organized in 1973 and incorporated under the state of Illinois,
The ShoreBank Corporation was America's first and leading
community development and environmental bank holding company. SBK
was a registered bank holding company for, among others, its
subsidiary, ShoreBank in Chicago, a state chartered non-member
bank. The Bank was subject to oversight and regulation by its
primary regulator, the Illinois Department of Financial and
Professional Regulation.
On Aug. 20, 2010, the Bank was closed by the IDFPR, and the
Federal Deposit Insurance Corp. was named receiver. The FDIC sold
substantially all of the Bank's assets to Urban Partnership Bank.
SBK's principal asset and source of income was its investment in
the Bank. The Bank Closure has had a significant adverse affect
on SBK's liquidity, capital resources, and financial condition.
On Jan. 9, 2012, SBK and 11 affiliates commenced Chapter 11 cases
(Bankr. N.D. Ill. Lead Case No. 12-00581) to liquidate their
remaining assets and wind down their estates.
The case was initially assigned to Judge Jacqueline P. Cox. On
Jan. 10, she recused herself and the case was sent to Judge A.
Benjamin Goldgar's chambers.
George Panagakis, Esq., leads a team of lawyers at Skadden, Arps,
Slate, Meagher & Flom LLP, who represent the Debtors. Garden City
Group Inc. serves as the Debtors' claims agent. The petition was
signed by George P. Surgeon, president and CEO.
The Debtor filed an Amended Disclosure Statement dated April 10,
2012, and on April 12, obtained approval of the document and
permission to begin soliciting votes on the Plan.
The confirmation hearing is scheduled for June 13, 2012, at 10:30
a.m. Objections are due May 30.
SOLAR TRUST: BrightSource's $10MM Bid for 500-MW Solar Plant OK'd
-----------------------------------------------------------------
Jamie Santo at Bankruptcy Law360 reports that a Delaware
bankruptcy judge on Friday approved BrightSource Energy Inc.'s $10
million stalking horse agreement for a 500-megawatt solar plant
development, a deal that represents the first concrete offer
bankrupt Solar Trust of America LLC has received for any of its
assets ahead of its upcoming auction.
Bankruptcy Law360 relates that the stalking horse offer for the
Palen project, a yet-unbuilt solar-thermal facility under
development near Desert Center, Calif., will set the floor for the
June 21 auction, which will be open to competing bids.
About Solar Trust
Solar Trust of America LLC, Solar Millennium Inc., and nine
affiliates filed for Chapter 11 protection (Bankr. D. Del. Lead
Case No. 12-11136) on April 2, 2012.
Solar Trust is a joint venture created by Solar Millennium AG and
Ferrostaal AG to develop solar projects at locations in California
and Nevada. Located in the "Solar Sun Belt" of the American
Southwest, the project sites have extremely high solar radiation
levels, and allow the Debtors' projects to harness high levels of
solar power generation. Projects include the rights to develop
one of the world's largest permitted solar plant facilities with
capacity of 1,000 MW in Blythe, California. Two other projects
contemplated 500 MW solar power facilities in Desert Center,
California and Amargosa Valley, Nevada.
Although the Debtors have obtained highly valuable transmission
right and permits, each project is only in the developmental phase
and does not generate revenue for the Debtors. Ferrostaal ceased
providing funding two years ago and SMAG, due to its own
deteriorating financial condition, stopped providing funding after
December 2011.
NextEra Energy Resources LLC has committed to provide a
postpetition secured credit facility and has expressed an interest
in serving as stalking horse purchaser for certain of the Debtors'
assets.
Attorneys at Young Conaway Stargatt & Taylor, LLP, serve as
counsel to the Debtors. K&L Gates LLP is the special corporate
counsel.
Ridgecrest Solar Power Project, LLC, and two entities filed for
Chapter 11 protection (Bankr. D. Del. Case Nos. 12-11204 to
12-11206) on April 10, 2012.
Ridgecrest Solar, et al., are affiliates of Solar Trust of America
LLC. STA Development, LLC, one of the debtors that filed for
bankruptcy April 2, owns 100% of the interests in Ridgecrest, et
al.
Ridgecrest Solar Power estimated up to $50,000 in assets and
debts. Ridgecrest Solar I, LLC, estimated up to $50,000 in assets
and up to $10 million in liabilities.
SOLAR TRUST: Global Finance Challenges Ownership
------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Solar Millennium Inc. has a challenge to ownership of
one of the two smaller properties, a 500-megawatt project still in
the planning stage in Amargosa Valley, Nevada. Global Finance
Corp. started a lawsuit in bankruptcy court on June 13 contending
that Solar Millennium lost its ownership interest in the project
by not moving forward with development. GFC wants the bankruptcy
court to preclude a sale and decide the extent of Solar
Millennium's ownership interest, if any.
About Solar Trust
Solar Trust of America LLC, Solar Millennium Inc., and nine
affiliates filed for Chapter 11 protection (Bankr. D. Del. Lead
Case No. 12-11136) on April 2, 2012.
Solar Trust is a joint venture created by Solar Millennium AG and
Ferrostaal AG to develop solar projects at locations in California
and Nevada. Located in the "Solar Sun Belt" of the American
Southwest, the project sites have extremely high solar radiation
levels, and allow the Debtors' projects to harness high levels of
solar power generation. Projects include the rights to develop
one of the world's largest permitted solar plant facilities with
capacity of 1,000 MW in Blythe, California. Two other projects
contemplated 500 MW solar power facilities in Desert Center,
California and Amargosa Valley, Nevada.
Although the Debtors have obtained highly valuable transmission
right and permits, each project is only in the developmental phase
and does not generate revenue for the Debtors. Ferrostaal ceased
providing funding two years ago and SMAG, due to its own
deteriorating financial condition, stopped providing funding after
December 2011.
NextEra Energy Resources LLC has committed to provide a
postpetition secured credit facility and has expressed an interest
in serving as stalking horse purchaser for certain of the Debtors'
assets.
Attorneys at Young Conaway Stargatt & Taylor, LLP, serve as
counsel to the Debtors. K&L Gates LLP is the special corporate
counsel.
Ridgecrest Solar Power Project, LLC, and two entities filed for
Chapter 11 protection (Bankr. D. Del. Case Nos. 12-11204 to
12-11206) on April 10, 2012.
Ridgecrest Solar, et al., are affiliates of Solar Trust of America
LLC. STA Development, LLC, one of the debtors that filed for
bankruptcy April 2, owns 100% of the interests in Ridgecrest, et
al.
Ridgecrest Solar Power estimated up to $50,000 in assets and
debts. Ridgecrest Solar I, LLC, estimated up to $50,000 in assets
and up to $10 million in liabilities.
SOLYNDRA LLC: Has Tentative Deal With Creditors; To File Plan Soon
------------------------------------------------------------------
Solyndra LLC told a Delaware bankruptcy judge last week that its
expects to file a Chapter 11 plan in the next few weeks, and that
Solyndra has reached an agreement in principle with a majority of
its major creditors.
According to Bankruptcy Law360, Solyndra told the judge at the
hearing Friday that it had resolved objections to the extension
and enlargement of its debtor-in-possession financing package.
The Associated Press reports the company is seeking court approval
to borrow an additional $3 million and to extend its bankruptcy
financing agreement through September as it works with landlords
and other parties to dismantle and sell equipment and dispose of
real estate.
The AP notes Solyndra has failed to find a buyer to operate the
company and is liquidating its assets.
About Solyndra LLC
Founded in 2005, Solyndra LLC was a U.S. manufacturer of solar
photovoltaic solar power systems specifically designed for large
commercial and industrial rooftops and for certain shaded
agriculture applications. The Company had 968 full time employees
and 211 temporary employees. Solyndra has sold more than 500,000
of its panels since 2008 and generated cumulative sales of over
$250 million.
Fremont, California-based Solyndra and affiliate 360 Degree Solar
Holdings Inc. sought Chapter 11 bankruptcy protection (Bankr. D.
Del. Lead Case No. 11-12799) on Sept. 6, 2011.
Judge Mary F. Walrath presides over the Debtors' cases. The
Debtors are represented by Pachulski Stang Ziehl & Jones LLP as
legal adviser. AlixPartners LLP serves as noticing claims and
balloting agent. Imperial Capital LLC serves as the company's
investment banker and financial adviser. The Debtors also tapped
former Massachusetts Governor William F. Weld, now with the law
firm McDermott Will & Emery, to represent the company in
government investigations and related litigation. BDO Consulting,
a division of BDO USA, LLP, as financial advisor and BDO Capital
Advisors, LLC, serves as investment banker for the creditors'
panel.
Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed seven
unsecured creditors to serve on the Official Committee of
Unsecured Creditors of Solyndra LLC. The Committee has tapped
Blank Rome LLP as counsel.
In October 2011, the Debtors hired Berkeley Research Group, LLC,
and designated R. Todd Neilson as Chief Restructuring Officer.
Solyndra is at least the fourth solar company to seek court
protection from creditors since August 2011. Other solar firms
are Evergreen Solar and start-up Spectrawatt Inc., both of which
filed in August, and Stirling Energy Systems Inc., which filed for
Chapter 7 bankruptcy late in September.
Solyndra owed secured lenders $783.8 million, including
$527.8 million to the U.S. government pursuant to a federal loan
guarantee, and held assets valued at $859 million as of the
Petition date. The U.S. Federal Financing Bank, owned by the U.S.
Treasury Department, is the Company's biggest lender. Billionaire
George Kaiser invested $400 million in the Company through an
investment vehicle connected to his George Kaiser Family
foundation.
When they filed for Chapter 11, the Debtors pursued a two-pronged
strategy to effectuate either a sale of their business to a
"turnkey" buyer who may acquire substantially all of Solyndra's
assets or, if the Debtors were unable to identify any potential
buyers, an orderly liquidation of the assets for the benefit of
their creditors.
Solyndra did not receive acceptable offers to buy the business as
a going concern. Two auctions late last year brought in a total
of $8 million. A three-day auction in February generated another
$3.8 million.
SOUPMAN INC: Timothy Gannon Joins as Senior Executive & Director
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Timothy J. Gannon, the co-founder of Outback Steakhouse, Inc.,
executed an agreement with Soupman, Inc., pursuant to which he
agreed to become a senior executive and member of the Board of
Directors of the Company, serving as the Company's Culinary and
Business Development Advisor.
Mr. Gannon will receive solely stock-based compensation in
connection with his services. Upon his commencement of
employment, he will receive 400,000 shares of the Company's common
stock, as well as be issued 10,000 shares of the Company's common
stock on a monthly basis. He will also be entitled to receive an
additional 400,000 shares of the Company's common stock on both
June 1, 2013, and June 1, 2014, of which half of any such shares
earned will be delivered on the respective June 1 vesting dates
and the balance of the 200,000 shares will be delivered six months
thereafter.
Mr. Gannon will also be entitled to up to a total of 400,000
additional shares of the Company's common stock based on the
following stock incentive milestones.
If the Company's common stock trades:
(i) for $2 per share or more for 30 trading days, Mr. Gannon
will receive 100,000 shares of the Company's common stock;
(ii) for $4 per share or more for 30 trading days and is listed
on the NASDAQ stock exchange, Mr. Gannon will receive an
additional 100,000 shares of the Company's common stock;
(iii) for $6 per share or more for 30 trading days and is listed
on the NASDAQ stock exchange, Mr. Gannon will receive an
additional 100,000 shares of the Company's common stock;
and
(iv) for $8 per share or more for 30 trading days and is listed
on the NASDAQ stock exchange, Mr. Gannon will receive an
additional 100,000 shares of the Company's common stock.
In addition, for every new incremental $1 million in Company sales
annually Mr. Gannon will be awarded 5,000 shares of the Company's
common stock, with a maximum total award of 500,000 shares in
total, which would require the Company have achieved $100 million
in annual sales.
Tim Gannon, is the creator of the "Bloomin' Onion" recipe, and
many of the other dishes on Outback's menu.
There are no family relationships between Mr. Gannon and any
director, executive officer or person nominated or chosen by the
Company to become as director or executive officer. Additionally,
there have been no transactions involving Mr. Gannon that would
require disclosure under Item 404(a) of Regulation S-K.
About Soupman Inc.
Staten Island, New York-based Soupman, Inc., currently
manufactures and sells soup to grocery chains and other outlets
and to its franchised restaurants under the brand name "The
Original Soupman".
The Company's balance sheet at Feb. 29, 2012, showed $1.30 million
in total assets, $7.18 million in total liabilities, and a
stockholders' deficit of $5.88 million.
Berman & Company, P.A., in Boca Raton, Florida, expressed
substantial doubt about Soupman's ability to continue as a going
concern, following the Company's results for the fiscal year ended
Aug. 31, 2011. The independent auditors noted that the Company
has a net loss of $6.21 million and net cash used in operations of
$2.11 million for the year ended Aug. 31, 2011; and has a working
capital deficit of $5.47 million, and a stockholders' deficit of
$4.68 million at Aug. 31, 2011.
SPECTRE PERFORMANCE: K&N Judgment Appeal Result Cues Plan Duration
------------------------------------------------------------------
Spectre Performance submitted to the U.S. Bankruptcy Court for the
Central District of California a Disclosure Statement explaining
the proposed Plan of Reorganization.
The Debtor will begin soliciting votes on the Plan following
approval of the adequacy of the information in the Disclosure
Statement.
According to the Disclosure Statement, the Debtor's Plan is
designed to enable the Debtor to continue operations and afford it
sufficient time to repay prepetition debts. The Debtor will make
payments under the Plan primarily consisting of 100% of net
profits from continued business operations, or Net Operating
Income. The Plan may also be funded from Net Sale Proceeds,
if any, and any proceeds derived from Post-Confirmation Estate
Claims.
The Plan proposes to pay Allowed General Unsecured Claims 100% of
their Allowed Claim. The Debtor's sole shareholder, the Rosenbaum
Trust, holds a General Unsecured Claim in the approximate amount
of $1,470,000. To expedite payment to holders of Allowed General
Claims under the Plan, the Rosenbaum Trust has agreed to
subordinate its Claim to other Allowed General Unsecured Claims
such that the holders of Allowed General Unsecured Claims will be
repaid in full before the Rosenbaum Trust receives any repayment
on its Claim. The duration of the Plan is dependent on certain
factors, including the result of the appeal of the K&N Judgment
and income generated from business operations.
A full-text copy of the Disclosure Statement is available for free
at http://bankrupt.com/misc/SPECTRE_PERFORMANCE_ds.pdf
The Debtor set a July 3, 2012, hearing at 2 p.m., to consider
adequacy of the Disclosure Statement
About Spectre Performance
Spectre Performance, formerly known as Spectre Industries, filed a
Chapter 11 petition (Bankr. C.D. Calif. Case No. 12-21890) in
Riverside, California, on May 14, 2012. The Company incurred
significant legal costs in defending against lawsuits alleging
false advertising in connection with the marketing and sale of the
Company's performance automotive air filters and air intake
systems.
Ontario, California-based Spectre Performance disclosed $10.2
million in assets and $17.7 million in liabilities. Secured
claims total $3.7 million.
Amir Rosenbaum founded the company in 1983 by selling hose
covering NylaBraid. Now the company is a manufacturer of
performance racing autoparts. Spectre Performance --
http://www.spectreperformance.com/-- makes air and fuel
accessories, including cold air intake systems to pack cool air to
the engine, fuel lines and hoses for plumbing the engine, and
chrome hardware and valve covers for dressing the bay.
Judge Mark D. Houle presides over the case. Leonard M. Shulman,
Esq., at Shulman Hodges & Bastian LLP, serves as the Debtor's
counsel. The petition was signed by Amir Rosenbaum, president.
According to court filings, the Debtor expects that funds will be
available for distribution to unsecured creditors.
Prepetition lender Comerica Bank is represented in the case by
Reed Waddell, Esq., at Frandzel, Robins, Bloom & Csato LLC.
SPRING NAUD: Case Summary & 9 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Spring Naud Associates, Ltd., LP
2644 Lacy Streed
Los Angeles, CA 90031
Bankruptcy Case No.: 12-30898
Chapter 11 Petition Date: June 15, 2012
Court: United States Bankruptcy Court
Central District of California (Los Angeles)
Judge: Neil W. Bason
Debtor's Counsel: Blake Lindemann, Esq.
433 N Camden Dr., 4th Flr.
Beverly Hills, CA 90210
Tel: (310) 279-5269
Fax: (310) 279-5370
E-mail: blindemann@llgbankruptcy.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its nine largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/cacb12-30898.pdf
The petition was signed by Manuel Meza, president of general
partner.
Affiliates that previously filed Chapter 11 petitions:
Petition
Debtor Case No. Date
------ -------- ----
1019 South Central Associates LTD, LP 11-17360 05/12/11
Lacy Street Venture LTD, LP 12-19804 03/20/12
SPRING POINT: Second Amended Chapter 11 Plan Approved by Judge
--------------------------------------------------------------
The Hon. Joel T. Marker of the U.S. Bankruptcy Court for the
District of Utah confirmed Spring Pointe Development, L.L.C.'s
Second Amended Chapter 11 Plan dated April 10, 2012.
According to the Disclosure Statement, the Debtor's Plan provides
for the payment of Allowed Claims from the sale or refinancing of
the Debtor's Real Property. The Estate Auction is scheduled for
Aug. 20.
The Plan provides that in the event that the Real Property is not
refinanced or sold (in whole or in part) at the Estate Auction or
prior to the Estate Auction for an amount sufficient to pay the
Allowed amount of the Springville City Secured Claim in full,
Springville City will automatically be entitled to immediate
relief from the automatic stay of Section 362 of the Bankruptcy
Code on and as of Aug. 8.
Other Secured Creditors will also be entitled automatically to
relief from the automatic stay on the same date that Springville
City automatically receives such relief, in order to protect their
interests in the Real Property in connection with Springville
City's nonjudicial foreclosure.
The Debtor will have the right under the Plan to continue to try
to sell or refinance the Real Property consistent with the
provisions of the Plan (even if its sale or refinancing efforts
prior to Aug. 1, 2012, are unsuccessful, and even if the Estate
Auction on Aug. 20, 2012 is unsuccessful) until Springville City's
nonjudicial foreclosure is completed.
A full-text copy of the Disclosure Statement is available for free
at http://bankrupt.com/misc/SPRING_POINTE_ds_2amended.pdf
About Spring Pointe
Spring Pointe Development LLC, based in Springville, Utah, filed
for Chapter 11 bankruptcy (Bankr. D. Utah Case No. 11-32972) on
Sept. 2, 2011. Judge Joel T. Marker presides over the case. In
its petition, the Debtor estimated $10 million to $50 million in
assets and $1 million to $10 million in debts. The petition was
signed by Milton Christensen, managing member.
TALON INTERNATIONAL: Five Directors Re-Elected at Annual Meeting
----------------------------------------------------------------
Talon International, Inc., held its 2012 annual meeting of
stockholders on June 14, 2012. Immediately following the Annual
Meeting, the Company's board of directors was comprised of Mark
Dyne, Lonnie D. Schnell, David Ellis, Mark J. Hughes, and Morris
D. Weiss, all of whom were re-elected by the requisite vote of
shareholders.
On June 15, 2012, Talon entered into amendments to the Executive
Employment Agreements of each of Lonnie D. Schnell, the Company's
Chief Executive Officer and Chief Financial Officer, and Larry
Dyne, the Company's President.
Pursuant to the amendment to Mr. Schnell's Executive Employment
Agreement, (a) the term of the employment agreement was extended
through Dec. 31, 2014, and may be further extended to Dec. 31,
2015, (b) Mr. Schnell's annual base salary rate for the period
from Jan. 1, 2012, through the end of the term of the employment
agreement was increased to $375,000, and (c) certain amendments
were made to the calculation and payment terms of the annual
incentive cash bonus that Mr. Schnell may be entitled to receive
upon Talon achieving targeted performance results.
Pursuant to the amendment to Mr. Dyne's Executive Employment
Agreement, (a) the term of the employment agreement was extended
through Dec. 31, 2014, and may be further extended to Dec. 31,
2015, (b) Mr. Dyne's annual base salary rate for the period from
Jan. 1, 2012, through the end of the term of the employment
agreement was increased to $350,000, and (c) certain amendments
were made to the calculation and payment terms of the annual
incentive cash bonus that Mr. Dyne may be entitled to receive upon
Talon achieving targeted performance results.
About Talon International
Woodland Hills, Calif.-based Talon International, Inc. (OTC BB:
TALN) -- http://www.talonzippers.com/-- is a global supplier of
apparel fasteners, trim and interlining products to manufacturers
of fashion apparel, specialty retailers, mass merchandisers, brand
licensees and major retailers. Talon manufactures and distributes
zippers and other fasteners under its Talon(R) brand, known as the
original American zipper invented in 1893. Talon also designs,
manufactures, engineers, and distributes apparel trim products and
specialty waistbands under its trademark names, Talon, Tag-It and
TekFit, to more than 60 apparel brands and manufacturers including
Wal-Mart, Kohl's, J.C. Penney, Victoria's Secret, Tom Tailor,
Abercrombie and Fitch, Polo Ralph Lauren, Phillips-Van Heusen,
Reebok and Juicy Couture. Talon has offices and facilities in the
United States, United Kingdom, Hong Kong, China, and Bangladesh.
The Company's balance sheet at March 31, 2012, showed $14.99
million in total assets, $8.32 million in total liabilities,
$21.44 million in series B convertible preferred stock, and a
$14.78 million total stockholders' deficit.
TAYLOR BEAN: Former Exec Gets 5 Years for Role in $3-Bil. Fraud
---------------------------------------------------------------
Max Stendahl at Bankruptcy Law360 reports that U.S. District Judge
Leonie M. Brinkema on Friday sentenced a former Taylor Bean &
Whitaker Mortgage Corp. executive to five years in prison for his
role in what prosecutors have called a $2.9 billion fraud scheme
that bilked investors and felled the lending giant.
Bankruptcy Law360 relates that Judge Brinkema also ordered former
Taylor Bean Chief Financial Officer Delton de Armas to serve three
years of supervised release, with restitution to be calculated at
a later date.
About Taylor Bean
Taylor, Bean & Whitaker Mortgage Corp. grew from a small Ocala-
based mortgage broker to become one of the largest mortgage
bankers in the United States. In 2009, Taylor Bean was the
country's third largest direct-endorsement lender of FHA-insured
loans of the largest wholesale mortgage lenders and issuer of
mortgage backed securities. It also managed a combined mortgage
servicing portfolio of approximately $80 billion. The company
employed more that 2,000 people in offices located throughout the
United States.
Taylor Bean sought Chapter 11 protection (Bankr. M.D. Fla. Case
No. 09-07047) on Aug. 24, 2009. Taylor Bean filed the Chapter 11
petition three weeks after federal investigators searched its
offices. The day following the search, the Federal Housing
Administration, Ginnie Mae and Freddie Mac prohibited the company
from issuing new mortgages and terminated servicing rights.
Taylor Bean estimated more than $1 billion in both assets and
liabilities in its bankruptcy petition
Lee Farkas, the former chairman, was sentenced in June to 30 years
in federal prison after being convicted on 14 counts of conspiracy
and bank, wire and securities fraud in what prosecutors said was a
$3 billion scheme involving fake mortgage assets.
Jeffrey W. Kelly, Esq., and J. David Dantzler, Jr., Esq., at
Troutman Sanders LLP, in Atlanta, Ga., and Russel M. Blain, Esq.,
and Edward J. Peterson, III, Esq., at Stichter, Riedel, Blain &
Prosser, PA, in Tampa, Fla., represent the Debtors. Paul Steven
Singerman, Esq., and Arthur J. Spector, Esq., at Berger Singerman
PA, in Miami, Fla., represent the Committee. BMC Group, Inc.,
serves as the claims and noticing agent.
TEN SAINTS: Bancroft & John OK'd to Appeal 2012-2013 Tax Value
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Nevada authorized
Ten Saints LLC to employ Bancroft & John, P.C. as special
counsel with regard to the 2012-2013 property tax appeal.
As reported in the Troubled Company Reporter on Feb. 28, 2012,
Bancroft is expected to appeal the 2012-2013 assessed tax value of
the Hampton Inn in Clark County, Nevada, in an effort to reduce
its corresponding 2012-2013 tax obligation for the property.
For the 2010-2011 tax year, the debtor engaged Bancroft to appeal
the assessed tax value for the property, which appeal resulted in
a reduction, from $7,602,991 to 2,344,182 in the taxable value of
the property, and which resulted in a corresponding of its tax
obligations.
For the 2011-2012 tax year, the Debtor engaged Bancroft to appeal
the taxable value for the Hampton Inn, which appeal resulted in a
reduction, from $6,991,800 to $2,885,120, in the taxable value of
the property, and which resulted in a reduction of its tax
obligations.
As stated in the 2012-2013 notice of value, the assessed tax value
of the property is $2,825,120. The value may still be in excess
of the property's full cash value under current market conditions
and, if it is, the Debtor's tax obligations for the property for
the 2012-2013 tax year will be greater than they must be.
Paul D. Bancroft, Esq. will be the individual primarily
responsible for performing the services required by the Debtor.
Bancroft will receive 33% of any property tax savings achieved for
tax year 2012-2013.
To the best of the Debtor's knowledge, Bancroft does not hold or
represent interests adverse to the Debtor.
About Horizon Village Square et al.
Four related Las Vegas, Nevada-based entities sought Chapter 11
bankruptcy protection on July 13, 2011. The businesses are owned
or managed by local business people and firms, including Todd
Nigro, Nigro Development LLC, a Nigro family trust and other
investors.
Horizon Village Square LLC (Bankr. D. Nev. Case No. 11-21034) owns
the Vons-anchored Horizon Village Square Shopping Center near
I-515 and Horizon Drive in Henderson. The property includes five
retail buildings with nearly 43,000 square feet of space.
Ten Saints LLC (Bankr. D. Nev. Case No. 11-21028) owns the 134-
room Hampton Inn & Suites at St. Rose Parkway and Seven Hills
Drive in Henderson.
Beltway One Development Group LLC (Bankr. D. Nev. Case No. 11-
21026) owns the Desert Canyon Business Park at Russell Road and
the Las Vegas Beltway. It has two buildings and 15 acres.
Nigro HQ LLC (Bankr. D. Nev. Case No. 11-21014) owns an office
building at 9115 W. Russell Road occupied by Bank of George,
Infinity Plus LLC and Nigro Construction Inc.
Todd Nigro said the four bankruptcies were caused by threatened
foreclosures -- typically related to Wells Fargo Bank demanding
payments to keep loan-to-value ratios at specified levels.
Judge Mike K. Nakagawa presides over the cases. Lawyers at Gordon
Silver serve as the Debtors' bankruptcy counsel. The bankruptcy
petitions estimated assets and debts from $1 million to $10
million each for Nigro HQ; and from $10 million to $50 million in
both assets and debts for Horizon Village, Ten Saints and Beltway
One. The cases are not jointly administered.
A fifth related business, Russell Boulder LLC, filed for
bankruptcy (Bankr. D. Nev. Case No. 10-29724) on Oct. 19, 2010.
It owns the 600-suite Siena Suites extended stay property at
Boulder Highway and Russell Road.
Edward M. Zachary, Esq., at Bryan Cave LLP, in Bryan Cave LLP, in
Phoenix, Ariz., and Robert M. Charles, Jr., Esq., at Lewis and
Roca LLP, in Los Vegas, Nev., represent Wells Fargo Bank, N.A., as
counsel.
TIC MEMPHIS: Case Summary & 4 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: TIC Memphis RI 13, LLC
c/o Randy R. Hanson
555 N. Riley St.
Las Vegas, NV 89149
Bankruptcy Case No.: 12-11828
Chapter 11 Petition Date: June 14, 2012
Court: United States Bankruptcy Court
District of Delaware (Delaware)
Judge: Christopher S. Sontchi
Debtor's Counsel: Jeffrey M. Schlerf, Esq.
FOX ROTHSCHILD LLP
Citizens Bank Center, Suite 1300
919 North Market Street
P.O. Box 2323
Wilmington, DE 19899-2323
Tel: (302) 654-7444
Fax: (302) 656-8920
E-mail: jschlerf@foxrothschild.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its four largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/deb12-11828.pdf
The petition was signed by Randy R. Hanson, member.
TMD FRICTION: Moody's Affirms 'B2' Corp. Family Rating
------------------------------------------------------
Moody's Investors Service has affirmed at B2 the corporate family
rating (CFR) of TMD Friction Group S.A. as well as the B2 rating
on the EUR 97 million senior secured notes issued by TMD Friction
Finance S.A. The outlook on the ratings is stable.
Ratings Rationale
"The affirmation of TMD Friction's CFR at B2 positively reflects
the company's ability to reduce its senior secured notes by an
amount of EUR63 million since its takeover by Nisshinbo in
November 2011. The repurchase of the notes was fully funded by the
company's parent Nisshinbo through subordinated shareholder loans
which in our view underpins Nisshinbo's strong commitment to
provide TMD Friction with financial support", says Rainer Neidnig,
a Moody's Vice President and lead analyst for TMD Friction.
"However, weaker than expected financial results for the first
quarter of 2012 together with the currently challenging
macroeconomic environment in Europe offset these benefits to a
certain extent and position TMD Friction's rating adequately in
the B2 category", adds Mr. Neidnig.
In May 2012, TMD Friction has redeemed EUR43 million worth of its
senior secured notes. This was for the second time in 2012 that
the company repurchased parts of its notes with funds provided by
Nisshinbo (NISH) through subordinated shareholder loans. We
positively note that these intercompany loans are non-cash
interest bearing debt and will save TMD Friction approximately
EUR7 million of annual cash interest going forward. Moreover, due
to their subordinated nature, Moody's considers 50% of these
shareholder funds as equity which consequently leads to a reduced
leverage at TMD Friction. As of June 15, EUR97 million worth of
TMD Friction's senior notes remain outstanding. Applying Moody's
loss-given-default (LGD) methodology the indicated rating on the
notes is unchanged at B2 as shareholder loans are excluded from
Moody's LGD model due to their equity-like characteristics.
Finally, as a result of TMD Friction's enhanced ownership
structure following the acquisition by NISH, Moody's decided to
slightly soften its triggers for a possible change of the
company's rating as specified below.
TMD Friction's B2 rating in Moody's view continues to benefit from
the company being part of a larger and more diversified industrial
group. Its single owner NISH is a publicly listed holding company
with subsidiaries that are active in textiles, automobile brakes,
papers, mechatronics, chemicals and electronics. According to TMD
Friction, the combination with NISH's automobile brake business
creates the world's largest automotive brake friction
manufacturer. The combined companies are expected to generate
revenues of over EUR1 billion and employ more than 6,000 people.
Moody's believes that the opportunities associated with the
company's new ownership structure (e.g. joint purchasing and
marketing activities) outweigh potential risks in connection with
the still ongoing integration process or challenges associated
with the combination of two different corporate cultures. In the
fiscal year ending March 31, 2012, NISH generated JPY379 billion
in revenues (approximately EUR3.5 billion) and operating profit of
JPY4.2 billion (circa EUR39 million) after an operating profit of
JPY 20 billion in FY2011. Following the acquisition of TMD
Friction at the end of 2011 and due to the effects from the
earthquake in Japan in 2011, estimated adjusted leverage of NISH
has been relatively high at 9.7x debt/EBITDA for the fiscal year
ended March 2012, but is expected to reduce in the current fiscal
year with the full year contribution from TMD Friction and a
continued recovery of Japan's economy.
At the same time, Moody's notes that TMD Friction's CFR remains
constrained at B2 due the company's weak financial performance in
the last quarter of 2011 and first quarter of 2012. While revenues
of EUR657 million for the last twelve months period ending March
2012 bottomed out at FY2011 levels, EBITDA as adjusted by Moody's
declined slightly to EUR50 million for the same period from EUR51
million in FY2011. As of March 2012 TMD Friction's leverage on a
Moody's adjusted basis stood at 4.6x debt /EBITDA. Pro forma the
EUR43 million worth of senior notes being replaced by subordinated
debt from NISH in May 2012, Moody's adjusted leverage ratio for
TMD Friction's improves to 4.2x debt/EBITDA.
Main reasons for the company's weaker than expected first quarter
performance were persistently high and volatile raw material
prices (e.g. copper, tin or steel) as well as a marked decline in
demand from most of its original equipment manufacturing customers
(OEMs) in Europe apart from the German and UK premium carmakers.
In addition, TMD Friction was faced with slowing demand from China
where local customers delayed several vehicle production plans and
volume losses in its independent aftermarket segment due to
unseasonably mild weather in Europe and general concerns over the
economic environment, particularly in the UK and Southern Europe.
Lastly, Moody's cautions that TMD Friction generated 86% of its
2011 group revenues in Europe where the overall macroeconomic
environment currently continues to be challenging.
TMD Friction's B2 CFR is based on the following: (i) the company's
strong position in the original equipment market and the
aftermarket for automotive brake pads and linings; (ii) the fact
that a large proportion of its revenues are generated in the
usually more resilient aftermarket; (iii) the company's advanced
technologies, which allow it to supply OEM customers worldwide
despite region-specific product requirements; (iv) its established
and solid relationships with automobile manufacturers and auto
equipment suppliers; and (v) its operating footprint, which
benefits from a reduced cost base on the back of successful
rationalization and cost-cutting initiatives in recent years.
The stable outlook on TMD Friction's ratings is based on Moody's
expectation that the company will gradually reduce its leverage to
levels close to 4x debt/EBITDA on an adjusted basis during 2012.
Furthermore, Moody's expects the company to at least maintain its
current profitability and to achieve free cash flow around
breakeven in 2012.
What Could Change the Rating Up/Down
Moody's would consider upgrading TMD Friction's ratings if the
company were able to (i) generate EBIT margins above 4%; (ii)
reduce leverage to 3.5x debt/EBITDA or lower; (iii) achieve an
interest coverage of well above 1.0x EBIT/interest expense and;
(iv) return to positive free cash flow on a sustainable basis.
Conversely, downward pressure on TMD Friction's ratings could
arise if the company were to fail to (i) improve EBIT margins to
at least 3%; (ii) return to free cash flow above breakeven; and
(iii) reduce leverage levels to close to 4.0x debt/EBITDA. The
rating would also come under pressure should TMD Friction --
contrary to expectations -- start upstreaming cash to its owner,
by dividend payments or other means.
The principal methodology used in rating TMD Friction Group S.A.
was the Global Automotive Supplier Industry Methodology published
in January 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.
TOBACCO SQUARE: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Tobacco Square LLC
836 Oak Street
Winston-Salem, NC 27101
Bankruptcy Case No.: 12-50856
Chapter 11 Petition Date: June 13, 2012
Court: U.S. Bankruptcy Court
Middle District of North Carolina (Winston-Salem)
Debtor's Counsel: Katherine J. Clayton, Esq.
BROOKS, PIERCE, MCLENDON, HUMPHREY & LEONARD,
L.L.P.
P.O. Box 1800
Raleigh, NC 27602
Tel: (919) 839-0300
Fax: (919) 839-0304
E-mail: kclayton@brookspierce.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 20 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/ncmb12-50856.pdf
The petition was signed by A. J. Rivenbark, manager.
TODD BRUNNER: Largest Creditor Seeks Contempt, Jail Time
--------------------------------------------------------
Cary Spivak at the Journal Sentinel reports that efforts to
liquidate a portion of Todd Brunner's financial empire -- a
portfolio that includes pricey cars, boats and about 200 pieces of
property -- are off to a contentious start, with his largest
creditor asking that Mr. Brunner be cited with contempt and jailed
for refusing to cooperate.
"I can't recall a case that where you had this many properties and
this many competing claims, was this contentious and had this much
litigation following the dismissal of the Chapter 11
(bankruptcy)," the report quotes Michael Polsky, a Milwaukee
attorney who specializes in receiverships, as saying. "There
isn't a lot of history as far as what happens now."
The report relates Mr. Polsky, who is not involved in the case,
said litigation may drag on for years as creditors try to collect
on some $20 million owed by Mr. Brunner, who has bought and sold
hundreds of foreclosed properties over the years and whose
penchant for driving pricey cars and boats often aggravates his
creditors.
According to the report, prosecutors dropped a felony charge
against Mr. Brunner that alleged he wrote a worthless $13,372
check. The charge was dropped in May after Mr. Brunner paid the
debt. However, investigations by the FBI and Milwaukee Police
Department into Mr. Brunner's real estate and bankruptcy dealings
are continuing.
The report says Mr. Brunner has been fighting off First Business
Bank-Milwaukee, which won a $2.2 million judgment against Mr.
Brunner after a company he owned with two partners defaulted on a
loan received to finance construction of an assisted-living center
in Waupun. The center went out of business shortly after it
opened.
The report notes, in an attempt to collect on that note, which was
guaranteed by Mr. Brunner and the partners, the bank persuaded
Waukesha County Judge Lee Dreyfus last month to name Milwaukee
attorney Douglas Mann to be the receiver for the majority of Mr.
Brunner's assets. Mr. Mann was authorized to seize Mr. Brunner's
assets to pay First Business Bank. The bank also complained Mr.
Brunner is refusing to cooperate with its receiver by not
providing access to his real estate and personal property. The
bank's lawyer, Dino Antonopoulos, is asking that Mr. Brunner be
jailed and fined up to $2,000 a day until he cooperates.
A hearing on the motion was scheduled for June 18, 2012.
The report relates Jonathan Goodman, Mr. Brunner's lawyer, said
his client is trying to negotiate with the bank, adding that he is
not involved in that effort.
The report also notes the City of Milwaukee filed a tax
foreclosure lawsuit last week on 60 city properties owned by Mr.
Brunner.
The report adds each of the properties owed at least three years
of back taxes. If taxes are not paid on the properties within 90
days, the court could turn the deeds over to the city, which owns
about 600 homes seized through tax foreclosures. The city will
manage, repair and try to sell the homes, said Jeff Fleming,
spokesman for the Department of City Development.
The report, citing public records, says Mr. Brunner, who owns
about 140 Milwaukee properties, owes more than $1.2 million in
back taxes, plus interest and penalties. Although 14 Brunner
properties in eight communities are on the foreclosure list, the
properties were not included in the county's lawsuit because the
court order dismissing Mr. Brunner's bankruptcy case was not
issued until April 5. The Debtors are protected from foreclosure
suits while in bankruptcy.
The report notes Mr. Brunner owes more than $256,000 in back taxes
on those 14 properties, including $30,026 on his home near
Pewaukee Lake.
Todd Brunner bought foreclosed properties throughout southeastern
Wisconsin, turning them into rental units. He filed for Chapter
11 protection (Bankr. E.D. Wis. Case No. 11-29064) on June 5,
2011, facing nearly $20 million in debt. This is his second
Chapter 11 filing.
Bankruptcy Judge James Shapiro threw out on April 2, 2012, Mr.
Brunner's bankruptcy filing because he failed to disclose all of
his assets and repeatedly blamed others for the collapse of his
empire.
TOTES ISOTONER: Moody's Affirms 'B3' CFR'; Outlook Stable
---------------------------------------------------------
Moody's Investors Service affirmed totes Isotoner Corporation's
ratings but revised the rating outlook to stable from positive.
The outlook change was based on Moody's expectation that totes'
credit metrics are unlikely to improve in the wake of warmer,
dryer weather this past winter and management's demonstrated
preference for spending excess cash flow on acquisitions rather
than on debt repayment. While revenues and operating profit have
steadily grown through acquisitions, the company has not reduced
its debt balance. As a result, leverage has remained elevated and
is unlikely to decline materially for the foreseeable future. The
company will need to demonstrate a willingness and ability to
reduce leverage on a sustained basis to mitigate the risk of
significant seasonal swings in earnings and cash flow.
The following ratings were affirmed and LGD point estimates
modified:
- Corporate Family Rating at B3
- Probability of Default Rating at B3
- $158 million senior secured fist lien term loan at B3 (LGD,
47% from 46%)
- $80 million senior secured second lien term loan at Caa2
(LGD5, 82% from 81%)
Ratings Rationale
The B3 corporate family rating reflects the company's weak credit
metrics, modest scale, commoditized products, and aggressive
financial policies in terms of acquisitions and dividends.
Furthermore, the company's make-or-break seasonality not only
means adverse weather patterns or consumer spending habits during
peak season could significantly impact its operations but also
makes the company heavily reliant on its revolver for seasonal
working capital uses. At the same time, the company's well
recognized brand names, broad distribution channels and geographic
diversification support the rating.
The stable outlook reflects Moody's expectations for modest
organic growth while maintaining adequate liquidity. Given
significant seasonality, Moody's expects debt/EBITDA to swing
between the low-5-times to mid-6-times range through the year.
Moody's would consider an upgrade if totes sustains revenues and
profitability growth while demonstrating a financial policy aimed
at reducing debt, such that its debt/EBITDA is sustained in the
low-5-times range. An upgrade would also require expectations for
an overall enhancement of liquidity, including maintaining a wider
cushion under debt covenants while continuing to generate positive
free cash flow.
Given the underlying demand for totes products, a downgrade in the
near term is unlikely. Moody's would likely downgrade the rating
with debt/EBITDA sustained above 7 times or if liquidity
deteriorates for any reason.
The principal methodology used in rating totes Isotoner
Corporation was the Global Apparel Industry Methodology published
in May 2010. Other methodologies used include Loss Given Default
for Speculative-Grade Non-Financial Companies in the U.S., Canada
and EMEA published in June 2009.
Based in Cincinnati, Ohio, totes is an international designer,
marketer and distributor of cold and wet weather accessories,
slippers, flip-flops and sunglasses with revenues approaching $400
million. The company distributes umbrellas and related products
primarily under the "totes" and "Raines" brands, cold-weather and
outdoor-wear products (hats, gloves, scarves) and slippers under
the "Isotoner", "Dockers" and "Manzella" brands, and sandals, flip
flops and thongs under the "Acorn" brand and private labels. The
company is majority owned by MidOcean Partners.
TRIAD GUARANTY: Five Directors Elected at Annual Meeting
--------------------------------------------------------
The Company's annual meeting of stockholders was held on May 17,
2012. Five directors were elected at the annual meeting, namely:
(1) H. Lee Durham, Jr.;
(2) Deane W. Hall;
(3) Kenneth W. Jones;
(4) William T. Ratliff, III; and
(5) David W. Whitehurst.
The proposal to amend the Company's Certificate of Incorporation,
as amended, to increase the number of authorized shares of common
stock from 32,000,000 to 100,000,000 did not receive the required
votes for approval. The proposal to amend the Company's
Certificate of Incorporation, as amended, to increase the number
of authorized shares of preferred stock from 1,000,000 to
5,000,000 did not receive the required votes for approval.
Stockholders voted to ratify the appointment of Ernst & Young LLP
as the Company's independent registered public accounting firm for
the year ending Dec. 31, 2012.
About Triad Guaranty
Winston-Salem, N.C-based Triad Guaranty Inc. (OTC BB: TGIC)
-- http://www.triadguaranty.com/-- is a holding company that
historically provided private mortgage insurance coverage in the
United States through its wholly-owned subsidiary, Triad Guaranty
Insurance Corporation. TGIC is a nationwide mortgage insurer
pursuing a run-off of its existing in-force book of business.
The Company reported a net loss of $107.77 million in 2011,
compared with net income of $132.09 million in 2010.
The Company's balance sheet at March 31, 2012, showed $875.69
million in total assets, $1.61 billion in total liabilities and a
$737.77 million deficit in assets.
Going Concern
The Company has prepared its financial statements on a going
concern basis under GAAP, which contemplates the realization of
assets and the satisfaction of liabilities and commitments in the
normal course of business. However, there is substantial doubt as
to the Company's ability to continue as a going concern. This
uncertainty is based on, among other things, the possible failure
of Triad to comply with the provisions of the Corrective Orders
and the Company's ability to generate enough income over the term
of the remaining run-off to overcome its $737.8 million deficit in
assets at March 31, 2012.
Bankruptcy Warning
The positive impact on statutory surplus resulting from the second
Corrective Order has resulted in Triad reporting a policyholders'
surplus in its SAP financial statements of $228.9 million at
March 31, 2012, as opposed to a deficiency in policyholders'
surplus of $770.3 million on the same date had the second
Corrective Order not been implemented. While the implementation
of the second Corrective Order has deferred the institution of an
involuntary receivership proceeding, no assurance can be given
that the Department will not seek receivership of Triad in the
future and there continues to be substantial doubt about the
Company's ability to continue as a going concern. The Department
may seek receivership of Triad based on its determination that
Triad will ultimately become insolvent, if Triad fails to comply
with provisions of the Corrective Orders, or for other reasons.
If the Department seeks receivership of Triad, TGI could be
compelled to institute a proceeding seeking relief from creditors
under U.S. bankruptcy laws, or otherwise consider dissolution of
the Company.
TWIN CITY: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: Twin City Baptist Temple, Inc.
194 Electric Ave
Lunenburg, MA 01462
Bankruptcy Case No.: 12-42233
Chapter 11 Petition Date: June 14, 2012
Court: United States Bankruptcy Court
District of Massachusetts (Worcester)
Judge: Melvin S. Hoffman
Debtor's Counsel: James L. O'Connor, Jr., Esq.
NICKLESS, PHILLIPS AND O'CONNOR
625 Main Street
Fitchburg, MA 01420
Tel: (978) 342-4590
Fax: (978) 343-6383
E-mail: joconnor.nandp@verizon.net
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 20 largest unsecured creditors
is available for free at http://bankrupt.com/misc/mab12-42233.pdf
The petition was signed by Arthur Erven Burke.
US EAGLE: Can Continue Using Bank's Cash; Golf Products Unit Sold
-----------------------------------------------------------------
Comerica Bank has consented to the continued use by US Eagle
Corporation and its debtor-affiliates of Comerica's cash
collateral as the Debtors market and pursue a sale of their
assets.
On May 24, the Court signed off on a stipulation between the
Debtors and Comerica -- upon notice to the Official Committee of
Unsecured Creditors -- that affords the bank continued adequate
protection. The stipulation requires the Debtors to provide
Comerica and the Committee with a report at least once every 14
days outlining the Debtors' marketing efforts, including those of
their professionals 321 Capital Partners LLC, Lee & Associates,
and Hilco Real Estate, LLC, concerning the Debtors' remaining
assets.
In consenting to the continued use of cash collateral, however,
Comerica is not (a) obligating itself to agree to a further
extension or amendment to the Debtors' budget, (b) waiving its
ability to condition any consent to a future sale of the Debtors'
assets upon its receiving the proceeds from the sale, net of costs
of sale from the assets, nor (c) waiving its ability to object to
requests for the extension of and of the so-called "Exclusivity
Periods" of Bankruptcy Code section 1121, where only the Debtors
could propose and solicit votes on a reorganization plan.
Comerica is represented by Conrad K. Chiu, Esq., at Pryor Cashman
LLP
Golf Products Unit Sold for $1.5-Mil. Cash
The Bankruptcy Court in May approved the sale of Eagle One Golf
Products, Inc., free and clear of liens, claims, and encumbrances,
and the assumption and assignment of certain executory contracts
and unexpired leases to the buyer, Golf Supply House USA, Inc.
The Debtors also obtained permission to pay 321 Capital Partners,
LLC, its sales commission. 321 Capital Partners received three
bids for Eagle One Golf. Two of the bidders appeared and
participated at an auction in April. The other bidders were not
identified. The Debtors consulted the Official Committee of
Unsecured Creditors and lender Comerica Bank in selecting the
successful bidder.
The Purchase Price consisted of (i) cash in the aggregate amount
of $1,500,000 and assumption by the buyer of certain liabilities.
The Purchased Assets include at least $900,000 of accounts
receivable and inventory of at $2,000,000 at cost as of the
Closing Date,
At Closing, 300,000 of the Aggregate Cash Consideration were to be
deposited in an escrow account.
The Debtors also sought to sell real property commonly known as
1155-1189 W. La Cadena Drive; 3171 Columbia Avenue; 3190
Interchange Street, in Riverside, California, in a private
transaction, and pay real estate brokers in connection with sale.
The Bankruptcy Court was scheduled to continue on May 22, 2012,
the hearing to consider adequacy of the disclosure statement
explaining U.S. Eagle and its affiliates' proposed Chapter 11
Plan. No updates have been posted on the case docket as of press
time. A full-text copy of the Disclosure Statement is available
for free at http://bankrupt.com/misc/US_EAGLE_ds_firstamended.pdf
About U.S. Eagle
U.S. Eagle filed for Chapter 11 protection (Bankr. D. N.J. Case
No. 11-10392) on Jan. 6, 2011. Samuel Jason Teele, Esq., at
Lowenstein Sandler PC, serves as the Debtor's bankruptcy counsel.
The Debtor estimated its assets and debts at $10 million to
$50 million.
U.S. Eagle Litho, Inc. (Bankr. D. N.J. Case No. 11-10401), Eagle
One Golf Products, Inc. (Bankr. D. N.J. Case No. 11-10397), Julius
Realty Corporation (Bankr. D. N.J. Case No. 11-10393), Traffic
Control Service, Inc., an Arizona Corporation (Bankr. D. N.J. Case
No. 11-10398), Traffic Control Service, Inc., a California
Corporation (Bankr. D. N.J. Case No. 11-10403), and Traffic
Control Service, Inc., a Nevada Corporation (Bankr. D. N.J. Case
No. 11-10392) filed separate Chapter 11 petitions on the same day.
Three Twenty One Capital Partners, LLC serves as exclusive agent
for the Debtors.
On Feb. 22, 2011, the U.S. Trustee appointed an Official Committee
of Unsecured Creditors. Porzio, Bromberg & Newman, P.C.,
represents the Committee. The Committee retained EisnerAmper LLP
as its accountant and financial advisor.
No trustee or examiner has been requested or appointed in the
Chapter 11 cases.
US EAGLE: Hires Jones Lang LaSalle Americas as Real Estate Broker
-----------------------------------------------------------------
US Eagle Corporation and its debtor-affiliates sought and obtained
Court authority to employ Jones Lang LaSalle Americas, Inc., as
real estate broker for the Debtors' property in Sacramento,
California.
Debtor Julius Realty Corp. owns a 19,200-square foot building on
1.38 acres of land located at 8585 Thys Court in Sacramento. On
May 16, 2012, Julius Realty Corp. entered into an Exclusive
Leasing Listing and Commission Agreement for the exclusive right
to lease the Property.
The Debtors will employ JLLA as their real estate broker to lease
the Property pursuant to the terms of the Listing Agreement. The
Debtors will pay JLLA on a fixed percentage fee basis in
accordance with the Schedule of Commissions attached to the
Listing Agreement.
The Debtors are separately seeking Court permission to enter into
a postpetition agreement with Regus Management Group LLC. A
hearing on the request is set for June 25.
JLLA attests it does not have an interest materially adverse to
the interest of the estate or of any class of creditors or equity
security holders, by reason of any direct or indirect relationship
to, connection with, or interest in, the Debtors; and is a
disinterested person as that term is defined in section 101(14) of
the Bankruptcy Code.
About U.S. Eagle
U.S. Eagle filed for Chapter 11 protection (Bankr. D. N.J. Case
No. 11-10392) on Jan. 6, 2011. Samuel Jason Teele, Esq., at
Lowenstein Sandler PC, serves as the Debtor's bankruptcy counsel.
The Debtor estimated its assets and debts at $10 million to
$50 million.
U.S. Eagle Litho, Inc. (Bankr. D. N.J. Case No. 11-10401), Eagle
One Golf Products, Inc. (Bankr. D. N.J. Case No. 11-10397), Julius
Realty Corporation (Bankr. D. N.J. Case No. 11-10393), Traffic
Control Service, Inc., an Arizona Corporation (Bankr. D. N.J. Case
No. 11-10398), Traffic Control Service, Inc., a California
Corporation (Bankr. D. N.J. Case No. 11-10403), and Traffic
Control Service, Inc., a Nevada Corporation (Bankr. D. N.J. Case
No. 11-10392) filed separate Chapter 11 petitions on the same day.
Three Twenty One Capital Partners, LLC serves as exclusive agent
for the Debtors.
On Feb. 22, 2011, the U.S. Trustee appointed an Official Committee
of Unsecured Creditors. Porzio, Bromberg & Newman, P.C.,
represents the Committee. The Committee retained EisnerAmper LLP
as its accountant and financial advisor.
No trustee or examiner has been requested or appointed in the
Chapter 11 cases.
US EAGLE: Seeks to Hire Commerce CRG to Lease Vegas Property
------------------------------------------------------------
U.S. Eagle Corporation and its affiliates seek permission to
employ Commerce CRG of Nevada, LLC d/b/a Commerce Real Estate
Solutions as their real estate broker for a real property in Las
Vegas, Nevada.
The property is located at "6680 South Surrey Street and 2180 Pama
Lane, an approximate 25,500 SF Industrial Building on 1.54 acres
and an approximate 3.53 acre parcel of paved/fenced land; APN:
177-02-512-003 and 177-02-613-002."
On May 30, 2012, debtor Julius Realty Corp. entered into an
Exclusive Listing Agreement For Lease Transaction for the
exclusive right to lease the Property. The Debtors intend to hire
Commerce CRG of Nevada to lease the Property pursuant to the terms
of the Listing Agreement.
The Debtors propose to compensate Commerce CRG of Nevada on a
fixed percentage fee basis in accordance with the Schedule of
Commissions attached to the Listing Agreement.
About U.S. Eagle
U.S. Eagle filed for Chapter 11 protection (Bankr. D. N.J. Case
No. 11-10392) on Jan. 6, 2011. Samuel Jason Teele, Esq., at
Lowenstein Sandler PC, serves as the Debtor's bankruptcy counsel.
The Debtor estimated its assets and debts at $10 million to
$50 million.
U.S. Eagle Litho, Inc. (Bankr. D. N.J. Case No. 11-10401), Eagle
One Golf Products, Inc. (Bankr. D. N.J. Case No. 11-10397), Julius
Realty Corporation (Bankr. D. N.J. Case No. 11-10393), Traffic
Control Service, Inc., an Arizona Corporation (Bankr. D. N.J. Case
No. 11-10398), Traffic Control Service, Inc., a California
Corporation (Bankr. D. N.J. Case No. 11-10403), and Traffic
Control Service, Inc., a Nevada Corporation (Bankr. D. N.J. Case
No. 11-10392) filed separate Chapter 11 petitions on the same day.
Three Twenty One Capital Partners, LLC serves as exclusive agent
for the Debtors.
On Feb. 22, 2011, the U.S. Trustee appointed an Official Committee
of Unsecured Creditors. Porzio, Bromberg & Newman, P.C.,
represents the Committee. The Committee retained EisnerAmper LLP
as its accountant and financial advisor.
No trustee or examiner has been requested or appointed in the
Chapter 11 cases.
US FIDELIS: Co-Owner Pleads Guilty to Insurance, Consumer Fraud
---------------------------------------------------------------
Juan Carlos Rodriguez at Bankruptcy Law360 reports that the
co-owner of U.S. Fidelis on Thursday pled guilty in Missouri state
court to his role in a scheme in which he allegedly withheld
customer refunds and used as much as $71 million for personal
expenses.
Cory Atkinson's attorney William S. Margulis said Friday his
client pled guilty Thursday and planned to plead guilty in federal
court to other charges on Monday, according to Bankruptcy Law360.
About US Fidelis
Wentzville, Missouri-based US Fidelis, Inc., was a marketer of
vehicle service contracts developed by independent and unrelated
companies. It stopped writing new business in December 2009.
The Company filed for Chapter 11 bankruptcy protection (Bankr.
E.D. Mo. Case No. 10-41902) on March 1, 2010. Brian T. Fenimore,
Esq., Crystanna V. Cox, Esq., James Moloney, Esq, at Lathrop &
Gage L.C., in Kansas City, Mo.; and Laura Toledo, Esq., at Lathrop
& Gage, in Clayton, Mo., advise the Debtor. GCG, Inc., is the
consumer claims and noticing agent.
Allison E. Graves, Esq., Brian Wade Hockett, Esq., and David A.
Warfield, Esq., at Thompson Coburn LLP, in St. Louis, Mo.,
represent the Official Unsecured Creditors Committee.
The Company scheduled assets of $74.4 million and liabilities of
$25.8 million as of the petition date.
VELO HOLDINGS: Inks Deal with Wilmington Trust on Retainer Fee
--------------------------------------------------------------
Velo Holdings Inc., et al., notified the U.S. Bankruptcy Court for
the Southern District of New York that it entered into a
stipulation with Wilmington Trust, National Association, the
Second Lien Prepetition Agent, regarding the return of the
retainer balance.
The Debtors and the Second Lien Prepetition Agent are parties to
the Second Lien Credit Agreement, dated as of Aug. 16, 2007.
The Debtors agreed and accepted the fee reimbursement arrangement
set forth in the fee letter dated as of Nov. 29, 2011, which
provided that the Debtors would pay Sidley Austin LLP, a $150,000
retainer to secure payment of fees and expenses incurred by Sidley
as counsel to the Second Lien Prepetition Agent.
The parties have negotiated and agreed that Sidley will apply the
retainer in full satisfaction of Sidley's invoice dated as of
April 13, 2012, for services rendered up to the Petition Date,
totaling $53,762, and return the balance of the retainer to the
Debtors.
A full-text copy of the stipulation is available for free at
http://bankrupt.com/misc/VELOHOLDINGS_loandocuments_stipulation.pd
f
About Velo Holdings, V2V et al.
V2V Corp. is a premier direct marketing services company,
providing individuals and businesses with access to a wide-variety
of consumer benefits in the United States, Canada, and the United
Kingdom. V2V was founded in 1989 as a membership services company
that marketed its membership programs exclusively via
telemarketing and, after having nearly a decade of continued
growth, went public in 1996. In 2007, V2V was acquired by a
consortium of private equity firms led primarily by investing
affiliates of One Equity Partners.
Norwalk, Connecticut-based Velo Holdings Inc. and various
affiliates, including V2V, filed for Chapter 11 bankruptcy (Bankr.
S.D.N.Y. Case Nos. 12-11384 to 12-11386 and 12-11388 to 12-11398)
on April 2, 2012. The debtor-affiliates are V2V Holdings LLC,
Coverdell & Company, Inc., V2V Corp., LN Inc., FYI Direct Inc.,
Vertrue LLC, Idaptive Marketing LLC, My Choice Medical Holdings
Inc., Adaptive Marketing LLC, Interactive Media Group (USA) Ltd.,
Brand Magnet Inc., Neverblue Communications Inc., and Interactive
Media Consolidated Inc.
Judge Martin Glenn presides over the case. Lawyers at Dechert LLP
serve as the Debtors' counsel. The Debtors' financial advisors
are Alvarez & Marsal Securities LLC. The Debtors' investment
banker is Alvarez & Marsal North America, LLC.
Quinn Emanuel Urquhart & Sullivan, LLP, serves as the Debtors'
special counsel. Epiq Bankruptcy Solutions serves as the
Debtors' claims agent. Velo Holdings estimated $100 million to
$500 million in assets and $500 million to $1 billion in debts.
The petitions were signed by George Thomas, general counsel.
Lawyers at Willkie Farr & Gallagher LLP represent Barclays, the
First Lien Prepetition Agent and the DIP Agent. The First Lien
Prepetition Agent and DIP Agent also has hired FTI Consulting,
Inc. Sidley Austin LLP represents the Second Lien Prepetition
Agent.
Tracy Hope Davis, U.S. Trustee for Region 2, appointed three
unsecured creditors to serve on the Official Committee of
Unsecured Creditors of Velo Holdings Inc., et al.
VHGI HOLDINGS: Incurs $5.4 Million Net Loss in First Quarter
------------------------------------------------------------
VHGI Holdings, Inc., filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $5.45 million on $449,032 of total revenue for the three months
eneed March 31, 2012, compared with a net loss of $246,621 on
$112,966 of total revenue for the same period a year ago.
The Company's balance sheet at March 31, 2012, showed $49.06
million in total assets, $48.54 million in total liabilities and
$524,106 in total stockholders' equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/nGTWPf
About VHGI Holdings
Fort Worth, Tex.-based VHGI Holdings, Inc., is a holding company
with revenue streams from the following business segments: (a)
precious metals (b) oil and gas (c) coal and (d) medical
technology.
For 2011, Pritchett, Siler & Hardy, P.C., in Salt Lake City, Utah,
expressed substantial doubt about VHGI Holdings' ability to
continue as a going concern. The independent auditors noted that
the Company has incurred substantial losses and has a working
capital deficit.
The Company reported a net loss of $5.43 million on $499,600 of
revenues for 2011, compared with a net loss of $1.67 million on
$482,300 of revenues for 2010.
VICTORIA FALLS: Moody's Raises Rating on Class D Notes to 'Ba2'
---------------------------------------------------------------
Moody's Investors Service has upgraded the ratings of the
following notes issued by Victoria Falls CLO, Ltd.:
U.S. $28,600,000 Class A-1B Floating Rate Notes Due February 17,
2017, Upgraded to Aaa (sf); previously on August 11, 2011
Upgraded to Aa1 (sf);
U.S. $8,500,000 Class B-1 Floating Rate Notes Due February 17,
2017, Upgraded to Aaa (sf); previously on August 11, 2011
Upgraded to Aa3 (sf);
U.S. $2,000,000 Class B-2 Fixed Rate Notes Due February 17,
2017, Upgraded to Aaa (sf); previously on August 11, 2011
Upgraded to Aa3 (sf);
U.S. $18,000,000 Class C Deferrable Floating Rate Notes Due
February 17, 2017, Upgraded to A3 (sf); previously on August 11,
2011 Upgraded to Baa3 (sf); and
U.S. $21,000,000 Class D Deferrable Floating Rate Notes Due
February 17, 2017 (current outstanding balance of $19,031,190),
Upgraded to Ba2 (sf); previously on August 11, 2011 Upgraded to
B1 (sf).
Ratings Rationale
According to Moody's, the rating actions taken on the notes are
primarily a result of deleveraging of the senior notes and an
increase in the transaction's overcollateralization ratios since
the rating action in August 2011. Moody's notes that the Class A-
1A Notes, Class A-2 Notes, and Class A-3 Notes have been paid down
by approximately 60.1%, 47.2% and 47.2%, respectively or $62.9
million, $33.0 million and $4.4 million, respectively, since the
last rating action. Based on the latest trustee report dated May
10, 2012, the Class A/B, Class C and Class D overcollateralization
ratios are reported at 127.70%, 114.03% and 102.44%, respectively,
versus July 2011 levels of 119.23%, 110.33%, and 102.26%,
respectively. The May 2012 trustee reported overcollateralization
levels do not reflect deleveraging of the Class A-1A Notes, Class
A-2 Notes, and Class A-3 Notes on the May 17, 2012 payment date.
Due to the impact of revised and updated key assumptions
referenced in "Moody's Approach to Rating Collateralized Loan
Obligations" published in June 2011, key model inputs used by
Moody's in its analysis, such as par, weighted average rating
factor, diversity score, and weighted average recovery rate, may
be different from the trustee's reported numbers. In its base
case, Moody's analyzed the underlying collateral pool to have a
performing par and principal proceeds balance of $163.8 million,
defaulted par of $3.1 million, a weighted average default
probability of 14.24% (implying a WARF of 2674), a weighted
average recovery rate upon default of 50.18%, and a diversity
score of 37. The default and recovery properties of the collateral
pool are incorporated in cash flow model analysis where they are
subject to stresses as a function of the target rating of each CLO
liability being reviewed. The default probability is derived from
the credit quality of the collateral pool and Moody's expectation
of the remaining life of the collateral pool. The average recovery
rate to be realized on future defaults is based primarily on the
seniority of the assets in the collateral pool. In each case,
historical and market performance trends and collateral manager
latitude for trading the collateral are also factors.
Victoria Falls CLO, Ltd., issued in February 2005, is a
collateralized loan obligation backed primarily by a portfolio of
senior secured loans.
The principal methodology used in this rating was "Moody's
Approach to Rating Collateralized Loan Obligations" published in
June 2011.
Moody's modeled the transaction using a cash flow model based on
the Binomial Expansion Technique, as described in Section 2.3 of
the "Moody's Approach to Rating Collateralized Loan Obligations"
rating methodology published in June 2011.
In addition to the base case analysis described above, Moody's
also performed sensitivity analyses to test the impact on all
rated notes of various default probabilities. Below is a summary
of the impact of different default probabilities (expressed in
terms of WARF levels) on all rated notes (shown in terms of the
number of notches' difference versus the current model output,
where a positive difference corresponds to lower expected loss),
assuming that all other factors are held equal:
Moody's Adjusted WARF -- 20% (2139)
Class A-1A: 0
Class A-1B: 0
Class A-2: 0
Class A-3: 0
Class B-1: 0
Class B-2: 0
Class C: +2
Class D: +1
Moody's Adjusted WARF + 20% (3209)
Class A-1A: 0
Class A-1B: 0
Class A-2: 0
Class A-3: 0
Class B-1: -1
Class B-2: -1
Class C: -2
Class D: -1
Moody's notes that this transaction is subject to a high level of
macroeconomic uncertainty, as evidenced by 1) uncertainties of
credit conditions in the general economy and 2) the large
concentration of speculative-grade debt maturing between 2014 and
2016, which may create challenges for issuers to refinance. CLO
notes' performance may also be impacted by 1) the manager's
investment strategy and behavior and 2) divergence in legal
interpretation of CLO documentation by different transactional
parties due to embedded ambiguities.
Sources of additional performance uncertainties are described
below:
1) Deleveraging: The main source of uncertainty in this
transaction is whether deleveraging from unscheduled principal
proceeds will continue and at what pace. Deleveraging may
accelerate due to high prepayment levels in the loan market and/or
collateral sales by the manager, which may have significant impact
on the notes' ratings.
2) Recovery of defaulted assets: Market value fluctuations in
defaulted assets reported by the trustee and those assumed to be
defaulted by Moody's may create volatility in the deal's
overcollateralization levels. Further, the timing of recoveries
and the manager's decision to work out versus sell defaulted
assets create additional uncertainties. Moody's analyzed defaulted
recoveries assuming the lower of the market price and the recovery
rate in order to account for potential volatility in market
prices.
VITRO SAB: Judge Voids Entire Reorganization in the U.S.
--------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the defeat that glassmaker Vitro SAB was given in a
June 13 opinion by the bankruptcy court in Dallas was made more
punishing when the judge signed a formal order on June 15 saying
he won't enforce any of the Mexican reorganization plan in the
U.S. The Mexican reorganization violates both U.S. law and public
policy, the judge said in his June 15 order.
According to the report, U.S. Bankruptcy Judge Harlin "Cooter"
Hale reiterated in his June 15 ruling that Vitro may not move
assets or divert business to other entities in a bid to frustrate
efforts bondholders may be allowed to undertake to collect $1.2
billion in defaulted bonds from non-bankrupt Vitro subsidiaries.
The report relates that after Judge Hale signed the formal order
on June 15, Vitro filed papers seeking permission to appeal
directly to the U.S. Court of Appeals in New Orleans, overstepping
an intermediate appeal to a U.S. district court. Judge Hale
previously said he would authorize a direct appeal to the circuit
court.
The suit in bankruptcy court to decide if the Mexican
reorganization will be enforced in the U.S. is Vitro SAB de CV
v. ACP Master Ltd. (In re Vitro SAB de CV), 12-03027, U.S.
Bankruptcy Court, Northern District of Texas (Dallas). The
bondholders' appeal in the circuit court is Ad Hoc Group of
Vitro Noteholders v. Vitro SAB de CV (In re Vitro SAB de CV),
11-11239, U.S. Court of Appeals for the Fifth Circuit (New
Orleans).
About Vitro SAB
Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV:
VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases
Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a global
glass producer, serving the construction and automotive glass
markets and glass containers needs of the food, beverage, wine,
liquor, cosmetics and pharmaceutical industries.
Vitro is the largest manufacturer of glass containers and flat
glass in Mexico, with consolidated net sales in 2009 of MXN23,991
million (US$1.837 billion).
Vitro defaulted on its debt in 2009, and sought to restructure
around US$1.5 billion in debt, including US$1.2 billion in notes.
Vitro launched an offer to buy back or swap US$1.2 billion in debt
from bondholders. The tender offer would be consummated with a
bankruptcy filing in Mexico and Chapter 15 filing in the United
States. Vitro said noteholders would recover as much as 73% by
exchanging existing debt for cash, new debt or convertible bonds.
Concurso Mercantil & Chapter 15 Proceedings
Vitro SAB on Dec. 13, 2010, filed its voluntary petition for a
pre-packaged Concurso Plan in the Federal District Court for
Civil and Labor Matters for the State of Nuevo Leon, commencing
its voluntary concurso mercantil proceedings -- the Mexican
equivalent of a prepackaged Chapter 11 reorganization. Vitro SAB
also commenced parallel proceedings under Chapter 15 of the U.S.
Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-16619) in Manhattan
on Dec. 13, 2010, to seek U.S. recognition and deference to its
bankruptcy proceedings in Mexico.
Early in January 2011, the Mexican Court dismissed the Concurso
Mercantil proceedings. But an appellate court in Mexico
reinstated the reorganization in April 2011. Following the
reinstatement, Vitro SAB on April 14, 2011, re-filed a petition
for recognition of its Mexican reorganization in U.S. Bankruptcy
Court in Manhattan (Bankr. S.D.N.Y. Case No. 11- 11754).
The Vitro parent received sufficient acceptances of its
reorganization by using the US$1.9 billion in debt owing to
subsidiaries to vote down opposition by bondholders. The holders
of US$1.2 billion in defaulted bonds opposed the Mexican
reorganization plan because shareholders could retain ownership
while bondholders aren't being paid in full.
Vitro announced in March 2012 that it has implemented the
reorganization plan approved by a judge in Monterrey, Mexico.
In the present Chapter 15 case, the Debtor seeks to block any
creditor suits in the U.S. pending the reorganization in Mexico.
Chapter 11 Proceedings
A group of noteholders opposed the exchange -- namely Knighthead
Master Fund, L.P., Lord Abbett Bond-Debenture Fund, Inc.,
Davidson Kempner Distressed Opportunities Fund LP, and Brookville
Horizons Fund, L.P. Together, they held US$75 million, or
approximately 6% of the outstanding bond debt. The Noteholder
group commenced involuntary bankruptcy cases under Chapter 11 of
the U.S. Bankruptcy Code against Vitro Asset Corp. (Bankr. N.D.
Tex. Case No. 10-47470) and 15 other affiliates on Nov. 17, 2010.
Vitro engaged Susman Godfrey, L.L.P. as U.S. special litigation
counsel to analyze the potential rights that Vitro may exercise
in the United States against the ad hoc group of dissident
bondholders and its advisors.
A larger group of noteholders, known as the Ad Hoc Group of Vitro
Noteholders -- comprised of holders, or investment advisors to
holders, which represent approximately US$650 million of the
Senior Notes due 2012, 2013 and 2017 issued by Vitro -- was not
among the Chapter 11 petitioners, although the group has
expressed concerns over the exchange offer. The group says the
exchange offer exposes Noteholders who consent to potential
adverse consequences that have not been disclosed by Vitro. The
group is represented by John Cunningham, Esq., and Richard
Kebrdle, Esq. at White & Case LLP.
A bankruptcy judge in Fort Worth, Texas, denied involuntary
Chapter 11 petitions filed against four U.S. subsidiaries. On
April 6, 2011, Vitro SAB agreed to put Vitro units -- Vitro
America LLC and three other U.S. subsidiaries -- that were
subject to the involuntary petitions into voluntary Chapter 11.
The Texas Court on April 21 denied involuntary petitions against
the eight U.S. subsidiaries that didn't consent to being in
Chapter 11.
Kurtzman Carson Consultants is the claims and notice agent to
Vitro America, et al. Alvarez & Marsal North America LLC, is the
Debtors' operations and financial advisor.
The official committee of unsecured creditors appointed in the
Chapter 11 cases of Vitro America, et al., has selected Sarah
Link Schultz, Esq., at Akin Gump Strauss Hauer & Feld LLP, in
Dallas, Texas, and Michael S. Stamer, Esq., Abid Qureshi, Esq.,
and Alexis Freeman, Esq., at Akin Gump Strauss Hauer & Feld LLP,
in New York, as counsel. Blackstone Advisory Partners L.P.
serves as financial advisor to the Committee.
The U.S. Vitro companies sold their assets to American Glass
Enterprises LLC, an affiliate of Sun Capital Partners Inc., for
US$55 million.
U.S. subsidiaries of Vitro SAB are having their cases converted to
liquidations in Chapter 7, court records in January 2012 show. In
December, the U.S. Trustee in Dallas filed a motion to convert the
subsidiaries' cases to liquidations in Chapter 7. The Justice
Department's bankruptcy watchdog said US$5.1 million in bills were
run up in bankruptcy and hadn't been paid.
WAGNER SQUARE: Involuntary Chapter 11 Case Summary
--------------------------------------------------
Alleged Debtor: Wagner Square l, LLC
11098 Biscayne Blvd #103
Miami, FL 33161
Case Number: 12-24697
Involuntary Chapter 11 Petition Date: June 15, 2012
Court: Southern District of Florida (Miami)
Judge: A. Jay Cristol
Petitioner's Counsel: Kenneth D. Murena, Esq.
DAMIAN & VALORI, LLP
1000 Brickell Ave. #1020
Miami, FL 33131
Tel: (305) 371-3960
Fax: (305) 371-3965
E-mail: kmurena@dvllp.com
Wagner Square l, LLC's petitioner:
Petitioner Nature of Claim Claim Amount
---------- --------------- ------------
Debra Sinkle Kolsky Loan-Arbitration $187,417
c/o Kenneth D Murena Award
1000 Brickell Ave #1020
Miami, FL 33131
WASTE2ENERGY HOLDINGS: Files Schedules of Assets and Liabilities
----------------------------------------------------------------
Waste2Energy Holdings Inc. filed with the Bankruptcy Court its
schedules of assets and liabilities, disclosing:
NAME OF SCHEDULE ASSETS LIABILITIES
---------------- ------ -----------
A - Real Property $0
B - Personal Property $1,648
C - Property Claimed
as Exempt
D - Creditors Holding
Secured Claims $0
E - Creditors Holding Unsecured
Priority Claims $476
F - Creditors Holding Unsecured
Nonpriority Claims $13,793,162
------ -----------
TOTAL $1,648 $13,793,639
Waste2Energy Holdings last filed financial reports on Form 10-Q
with the Securities and Exchange Commission in August 2010 for the
period ended June 30, 2010. The Company's balance sheet at June
30, 2010, showed $3.4 million in total assets, $11.7 million in
total liabilities, and a stockholders' deficit of $8.3 million.
About Waste2Energy Holdings
Greenville, S.C.-based Waste2Energy Holdings, Inc. (Pink Sheets:
WTEZ) -- http://www.waste2energy.com/-- is a "cleantech"
technology company that designs, builds, installs and sells waste
to energy plants that generate "Renewable Green Power" converting
biomass or other solid waste streams traditionally destined for
landfills into clean renewable energy.
On Aug. 8, 2011, four creditors filed an involuntary Chapter 11
petition against Waste2Energy Holdings (Bankr. D. Del. Case No.
11-12504). Judge Kevin J. Carey presides over the case. The
petitioning creditors, allegedly owed $3.2 million in the
aggregate, are represented by Frederick B. Rosner, Esq., at The
Rosner Law Group, LLC.
On Sept. 21, 2011, the Court entered an order effectively
converting the case from an involuntary to voluntary chapter 11
proceeding.
On Oct. 4, 2011, Wayne P. Weitz was appointed Chapter 11 trustee.
Cole, Schotz, Meisel, Forman & Leonard, P.A., is the Trustee's
bankruptcy counsel.
On Jan. 24, 2012, the Chapter 11 Trustee placed three affiliates
in bankruptcy. These are Waste2Energy Inc., Waste2Energy Group
Holdings PLC and Waste2Energy Technologies International Limited
(Case Nos. 12-10312 to 12-10314).
The Chapter 11 Trustee tried to sell the business for at least
$1 million but cancelled an auction set for April 24, 2012,
because there were no acceptable offers.
There is a motion yet to be argued in bankruptcy court for
dismissal of the case or conversion to a liquidation in Chapter 7.
WEST PENN: Moody's Affirms 'Caa1' Bond Rating; Outlook Negative
---------------------------------------------------------------
Moody's Investors Service has affirmed West Penn Allegheny Health
System's (WPAHS) (PA) Caa1 bond rating, affecting $737 million of
Series 2007 fixed rate bonds issued through the Allegheny County
Hospital Development Authority. The outlook remains negative.
Summary Rating Rationale
The Caa1 rating reflects the severity of the financial status of
the system and Moody's belief that, without the financial support
of Highmark (Baa2/negative), the system would have been forced to
restructure within the last year, which without such support, may
have resulted in a bond payment default as Moody's has seen in
other similar circumstances. While a new affiliation agreement
with Highmark has provided significant cash to WPAHS to remain
viable, the affiliation is expected to close in fall 2012 and,
therefore, Moody's is only partly incorporating the benefit of the
Highmark affiliation at this time. Highmark has committed a total
of $400 million in unrestricted payments or loans to WPAHS over a
period starting June 2011 to April 2014 and $75 million in
financial support for medical education. While Highmark has not
currently committed more funding beyond $475 million, Moody's
believes WPAHS will need more capital and/or operating support
over the next two years and Moody's current rating incorporates
Moody's belief that Highmark will be willing and motivated to
provide further support.
Through nine months of fiscal year 2012 (ended March 31, 2012),
the system reported a large operating loss of $88 million,
exceeding the full fiscal year 2011 operating loss of $75 million
(excluding approximately $23 million in a non-recurring positive
item included in operating revenue). Year-to-date discharges were
down 8%; including observation cases, inpatient volumes were down
5%, due to the reduction of services at West Penn Hospital.
Unrestricted cash (excluding project funds) as of March 31, 2012
was $203 million, down $38 million since fiscal yearend 2011, even
though the system received $100 million of payments from Highmark
during this period. The system's overall strategy in the
affiliation with Highmark has changed from one of downsizing to
targeted expansion, which creates a high degree of uncertainty and
execution and financial risks. Quarterly performance indicates a
reduction in the operating loss between the second and third
quarter but losses are still high and a fiscal year 2013 budget
was not provided for Moody's to evaluate.
CHALLENGES
* Uncertainty related to the viability of a new strategy to
expand rather than downsize; risks relate to reversing the
strategy to regain volumes and investing in recruiting physicians
while reducing financial losses
* Very large operating loss through nine months of fiscal year
2012 of $88 million, exceeding the fiscal year 2011 operating loss
of $75 million (excluding a large non-recurring positive item);
revenue declined 1% in the interim period, which includes eight
months of West Penn Hospital's reduced services.
* Continued decline in acute discharges of 8% through nine months
of fiscal year 2012 (5% including observation cases), largely due
to the closure and downsizing of services at West Penn Hospital
and inability to retain some volumes within the system
* Weak unrestricted cash position of 45 days of cash on hand as
of March 31, 2012 (excluding trustee-held project funds), which
represented a $38 million decline from fiscal yearend 2011;
Highmark has provided $100 million in payments since fiscal
yearend 2011 through March and another $50 million in April 2012;
without further support from Highmark, Moody's expects cash to
continue to decline at a fairly rapid rate until operating losses
are stemmed
* As of fiscal yearend 2011, underfunded status of pension plan
was large at almost $200 million, even though decreasing from $300
million at fiscal yearend 2010; the system made its required
pension payments in fiscal year 2011 and 2012.
* Heavy competition from UPMC Health System (Aa3/positive), which
is the largest health system in the region and owns a large
managed care plan, enabling UPMC to influence health plan
membership and volumes; UPMC will be opening a new hospital to
compete with WPAHS's Forbes Hospital
* High leverage relative to operating performance with 54% debt-
to-operating revenues; peak debt service coverage is zero based
upon Moody's methodology of annualizing nine-month results.
* Challenging demographic service area with declining population
trends in the primary service area and an aging patient base
STRENGTHS
* Affiliation agreement with Highmark, executed October 31, 2011,
which provides significant financial support to the system as
noted above
* Favorable debt structure with all fixed rate debt and no
interest rate derivatives
* System's prominence as the second largest healthcare system in
Pittsburgh with 56,000 acute discharges (nine months annualized)
Outlook
Maintenance of the negative outlook reflects the substantial
execution and financial risks as the system reverses strategy, and
a weak operating performance and cash position that leave little
flexibility to absorb any unexpected challenges, such as continued
volume declines.
What Could Make The Rating Go Up
With a negative outlook, a rating upgrade in the near-term is not
likely. Long-term, an upgrade would be considered with significant
and sustained improvement in operating cash flow for several
years, at least stability in volumes, significant growth in
unrestricted cash, stability or growth in medical staff and
closing of the Highmark affiliation.
What Could Make The Rating Go Down
Decline in unrestricted cash (excluding project funds), continued
large operating losses and volume declines; failure to close the
Highmark affiliation
The principal methodology used in this rating was Not-For-Profit
Healthcare Rating Methodology published in March 2012.
WHITE KNOLL VENTURE: Files Schedules of Assets and Liabilities
--------------------------------------------------------------
White Knoll Venture Ltd. filed with the Bankruptcy Court its
schedules of assets and liabilities, disclosing:
NAME OF SCHEDULE ASSETS LIABILITIES
---------------- ------ -----------
A - Real Property $700,000
B - Personal Property $1,600
C - Property Claimed
as Exempt
D - Creditors Holding
Secured Claims $1,002,000
E - Creditors Holding Unsecured
Priority Claims $0
F - Creditors Holding Unsecured
Nonpriority Claims $150,775
------ -----------
TOTAL $701,600 $1,152,775
White Knoll Venture, Ltd., filed a bare-bones Chapter 11 petition
(Bankr. C.D. Calif. Case No. 12-14737) on Feb. 9, 2012. White
Knoll, which claims to be a Single Asset Real Estate as defined in
11 U.S.C. Sec. 101(51B), estimated up to $50 million in assets and
up to $10 million in liabilities. Judge Peter Carroll oversees
the case. The petition was signed by Manuel Meza, president of
Creative Environments of Hollywood, Inc., general partner.
WILCOX EMBARCADERO: Plan Outline Hearing Slated for June 26
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of California
will convene a hearing on June 26, 2012, at 1:30 p.m., to consider
adequacy of the Disclosure Statement explaining Wilcox Embarcadero
Associates, LLC's proposed Plan of Reorganization. Objections, if
any, are due June 19.
According to the Disclosure Statement dated May 22, 2012, the Plan
sets forth the Debtor's proposal for the restructuring of its
finances and the satisfaction, discharge or cancellation of all
claims against the Debtor.
Under the Plan, among other things:
1. Secured Claim of Wells Fargo Bank, N.A. ($5,748,468): the
Debtor will pay entire amount due with interest by making all
monthly post-confirmation regular payments as amended.
2. Owens Mortgage Investment Fund, L.P. ($3,008,811): the
Debtor will pay entire amount due with interest by making all
monthly post-confirmation regular payments as amended.
3. General Unsecured Claims-Under $1,000 ($1,664): General
unsecured creditors whose claims are less than $500 will be paid
100% of their allowed claims without interest on the Effective
Date of the Plan.
4. General Unsecured Claims Over $1,000 & under $5,000
($7,365): General unsecured creditors whose claims are greater
than $500 and under $2,500 will be paid 100% of their Allowed
Claim without interest in three equal monthly installments with
the first payment on the Effective Date with the final payment two
months after the Effective Date. Creditors with claims in excess
of $2,500 may elect treatment under this class by reducing their
claims to $2,500.
5. General Unsecured Claims General unsecured creditors whose
Over $5,000 ($25,868) claims are greater than $2,500, or creditors
with claims less than $2,500, who elect treatment under this
class, will be paid 100% of their Allowed Claim with interest at
the rate of 9.0% in six equal monthly installments with the first
payment on the Effective Date, with the final payment 5 months
after the Effective Date.
6. General unsecured claims of tenants who have paid tenants
who have paid deposits deposits-Unimpaired will have their claims
recognized in full with their deposits retained by the Debtor
pursuant to their lease agreements.
A full-text copy of the Disclosure Statement is available for free
at http://bankrupt.com/misc/WILCOX_EMBARCADERO_ds.pdf
About Wilcox Embarcadero Associates
Wilcox Embarcadero Associates, LLC, filed a Chapter 11 petition in
Oakland (Bankr. N.D. Calif. Case No. 12-40758) on Jan. 26, 2012.
Wilcox operates a commercial building, leasing warehouse,
wholesale, retail and office space. Wilcox operates in the Bay
Area and has been in business for 10 years. The Debtor says it is
a single asset real estate case.
Steele, George, Schofield & Ramos LLP represents the Debtor in its
restructuring efforts.
In its schedules, The Debtor disclosed $10.2 million in assets and
under $8.6 million in liabilities. The Debtor's property
secures an $8.55 million debt to Wells Fargo and Owens Mortgage
Investment Fund, LP.
The Debtor said it incurred financial difficulty when its primary
lender, the holder of the First Deed of Trust, refused to extend,
modify or refinance the loan. The Debtor is in negotiations with a
new lender to take out the lender, but needs more time to
accomplish this task.
XTREME IRON: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Xtreme Iron Holdings, LLC
2000 S. Stemmons Freeway, Suite 200
Lake Dallas, TX 75065
Bankruptcy Case No.: 12-33832
Chapter 11 Petition Date: June 13, 2012
Court: U.S. Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Harlin DeWayne Hale
About the Debtor: The Debtor is the holding company for Lake
Dallas-based entity, Xtreme Iron, LLC --
http://www.xtreme-iron.com-- which claims to
own one of the largest heavy equipment rental
fleets in the state of Texas. Their fleet is
comprised of late model, low hour Caterpillar
and John Deere equipment.
Debtor's Counsel: Gregory Wayne Mitchell, Esq.
THE MITCHELL LAW FIRM, L.P.
8140 Walnut Hill Lane, Suite 301
Dallas, TX 75231
Tel: (972) 463-8417
Fax: (972) 463-4072
E-mail: greg@mitchellps.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The Company did not file a list of creditors together with its
petition.
The petition was signed by Ron Stover, member.
ZOO ENTERTAINMENT: David Smith Discloses 75% Equity Stake
---------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, David E. Smith and his affiliates disclosed
that, as of June 12, 2012, they beneficially own 24,109,629 shares
of common stock of Indiepub Entertainment, Inc., formerly known as
Zoo Entertainment, Inc., representing 75% of the shares
outstanding.
Mr. Smith previously reported beneficial ownership of 22,551,448
common shares or a 73.7% equity stake as of May 8, 2012.
A copy of the amended filing is available for free at:
http://is.gd/2A5Ygd
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 $25.87 million in 2011,
compared with a net loss of $14.03 million in 2010.
The Company's balance sheet at March 31, 2012, showed $1.96
million in total assets, $9.70 million in total liabilities and a
$7.73 million total stockholders' deficit.
For 2011, EisnerAmper LLP, in Edison, New Jersey, expressed
substantial doubt about the Company's ability to continue as a
going concern. The independent auditors noted that the Company
has both incurred losses and experienced net cash outflows from
operations since inception.
* Absolute Priority Survives in Individual Chapter 11s
------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the U.S. Court of Appeals in Richmond, Virginia,
ruled that Congress didn't repeal the absolute priority rule for
individuals in Chapter 11 when it amended the Bankruptcy Code in
2005. The Fourth Circuit is the highest court to address the
question that divides lower courts. The case is In re Maharaj,
11-1747, U.S. Court of Appeals for the Fourth Circuit (Richmond).
* False 'Financial Condition' Refers to Net Worth
-------------------------------------------------
Representing to a creditor that a bankrupt owns property isn't a
statement about the bankrupt's "financial condition," the U.S.
Court of Appeals in New Orleans ruled on June 12, coming down on
one side of an issue dividing the appeals courts, Bill Rochelle,
the bankruptcy columnist for Bloomberg News, reported. The Fifth
Circuit ruled that "financial condition" does not pertain to
statements about ownership of property because the property could
be encumbered by liens or mortgages. According to the appeals
court, "financial condition" relates to net worth. The opinion
was written by Circuit Judge Priscilla R. Owen. The case is Bandi
v. Becnel (In re Bandi), 11-30654, U.S. Court of Appeals for the
Fifth Circuit (New Orleans).
* Chapter 13 Can't Modify Mortgage More than Five Years
-------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Chief U.S. District Judge Christina Reiss in Vermont
ruled on June 13 that a Chapter 13 plan cannot reduce the interest
rate on a mortgage and extend the term of the mortgage beyond the
five-year life span of the plan. The case is JPMorgan Chase Bank
NA v. Galaske, 12-9, U.S. District Court, District of Vermont
(Burlington).
* Increased Use of Bankruptcy Petition Preparers Raises Concerns
----------------------------------------------------------------
U.S. bankruptcy courts increasingly are concerned with abuses
committed by some non-lawyers in the business of helping prepare
bankruptcy filing documents for a fee.
A growing number of people who seek bankruptcy protection navigate
that challenging process without a lawyer's help, as so-called
"pro se" filers. But federal bankruptcy law also allows them to
pay non-lawyers to prepare petitions for them. The law defines a
"bankruptcy petition preparer" (BPP) as "a person other than an
attorney for the debtor or an employee of such attorney . . . who
prepares for compensation a document for filing."
Many preparers operate within the strict limits the law imposes on
them, but some do not.
"We have seen an increase in abuse," said U.S. Bankruptcy Judge
Maureen Tighe in the Central District of California. "The increase
in 'foreclosure rescue' and 'loan modification' services seems to
be the source in the past three years. The homeowners are
desperate and take advice from the most questionable sources.
There is a wide range of BPPs, from those who are well-meaning but
still are giving legal advice, to out-and-out fraud perpetrators
-- and the down-and-out consumer debtor doesn't know the
difference most of the time."
According to the US Trustee Program Enforcement Activity, from FY
05-11, a total of 2,529 formal actions were filed by the U.S.
Trustee Program against bankruptcy petition preparers under 11
U.S.C. Sec. 110. Formal actions include all motions, complaints,
and objections filed by Program personnel with the bankruptcy
court seeking some type of relief. For FY 05-11, the success rate
was 98.5%. Success rate is defined as the total number of formal
actions where the court granted some or all of the relief sought
or the defendant agreed to relief satisfactory to the U.S.
Trustees, divided by the total number of formal actions
adjudicated or satisfactorily resolved prior to adjudication.
In Tighe's district, several petition preparers have been fined
for, among other infractions, the unauthorized practice of law and
collecting higher petition-preparation fees than the $200 allowed
by the bankruptcy court. (Petition-preparation fee limits vary in
the 91 bankruptcy courts.)
"I have had debtors who have paid thousands of dollars for
assistance that was useless or non-existent," Tighe said.
A locally focused report recently presented by Tighe's court
includes a troubling finding: "While self-represented debtors
receive discharges at a lower rate than represented debtors, the
group that did not personally file the cases at the courthouse had
their cases dismissed at double the already high rate."
That finding suggests that reliance on inadequate "representation"
by BPPs may be the reason. Earlier studies have shown that the
vast majority of debtors referred to as "pro se" filers are, in
fact, assisted by BPPs. "A 2003 study by the U.S. Trustees Program
reported that only 3% of debtors filing were truly pro se
. . . At the time of the study, 23% of all debtors used a BPP to
file," the bankruptcy court report said. "This may have changed
recently due to the presence of self-help desks in every division.
Court forms and rules require BPPs to disclose their involvement,
but the court has reason to believe that approximately half of
them fail to do so."
In Maryland, a BPP was sentenced to two years in prison to be
followed by three years of supervised release for contempt of
court for continuing to offer his services after being barred from
doing so.
In New Mexico, a BPP was permanently banned from helping debtors
after being cited with violations in nine separate cases.
In Colorado, the bankruptcy court imposed more than $42,000 in
sanctions against a bankruptcy petition preparer.
And in the Eastern District of Wisconsin, bankruptcy judges have
cited four preparers with contempt and referred the cases to the
U.S. District Court to determine whether criminal charges should
be filed against them. "Unethical preparers who are serial filers
are a problem for us," said Bankruptcy Judge Margaret Dee McGarity
in Milwaukee. "We have a pro se help desk staffed by volunteer
attorneys, and a designated person in the clerks office to help
get all the right papers filed. But we need to provide even more
assistance."
Over the past five years, McGarity's bankruptcy court, which
limits the fee a BPP can charge to $75, has barred seven
individuals from preparing petitions. But some preparers do not
sign the petitions as required by law, and tell their clients not
to tell the court about the help they received.
Eastern District of Wisconsin Chief Bankruptcy Judge Pamela Pepper
noted in a memorandum, prepared for a meeting on pro se debtors,
that anyone filing papers now must produce a driver's license, a
copy of which is placed in the court file -- an effort "to
identify people who are filing petitions for someone else."
It can be a difficult task. "We've discovered networks of people
-- in one, a preparer was barred, then was replaced by her
boyfriend, who eventually was barred, only to be replaced by her
brother, who was using her formerly incarcerated father's name and
a false Social Security number on the petitions," Pepper said.
"All of these people accept money that the most destitute debtors
have to beg or borrow to provide paperwork that is deficient at
best and damaging at worst."
In its fiscal year 2011 report, the U.S. Trustee Program said
bankruptcy trustees nationwide had filed 504 actions against BPPs,
with a success rate of 98.8%. More than $1.9 million in fines were
imposed and some $419,000 in fees recovered during that year, the
report said.
The U.S. Trustee Program, part of the Department of Justice,
features a warning on its website (Justice.gov) for those who
might seek help filing for bankruptcy protection.
"Non-attorney bankruptcy petition preparers may type bankruptcy
documents with information supplied by the debtor. They may not
provide legal services, such as helping you choose whether to file
under Chapter 7 or Chapter 13 or identifying your property that is
exempt from the reach of creditors," it states. "Bankruptcy
petition preparers may advertise their services under 'document
preparation services' and similar categories of services, but not
under 'legal services.' If a bankruptcy petition preparer offers
to provide legal services to you or fails to disclose that he or
she is not an attorney and may not provide legal services, please
report this to a U.S. Trustee Program field office."
Efforts to thwart fraud by BPPs are hampered in some districts by
cultural differences. "Our challenge is exacerbated by the large
Latino population who confuses notaries with 'notarios' because
'notarios' actually can carry out simple legal functions in
Central America," Tighe said. "Some of our BPPs just advertise as
'notarios' and reel them in."
In Arizona, the state Supreme Court certifies document preparers
-- including BPPs -- but such state regulation is not available in
all states.
* Moody's Says US Life Insurers' Credit Losses Decline Further
--------------------------------------------------------------
US life insurers investment-related credit losses continue to
decline, Moody's Investors Service says in a new report, though
they remain above historical norms in the wake of the financial
crisis, driven by continued weakness in the residential and
commercial real estate markets, and the sluggish economic
environment.
"US life insurers' 2011 investment credit losses were slightly
lower than in 2010 and dramatically lower than during the 2008-09
period, and we expect them to decline further this year," says
Shachar Gonen, analyst and author of "US Life Insurers' Investment
Credit Losses Continue Improvement in 2011; Driven by Low CML
Losses."
Moody's-rated life insurers reported pre-tax bond/preferred stock
credit losses of $8.1 billion in 2011, representing 38 basis
points of fixed-income assets. Losses last year comprised mainly
realized losses on corporate bonds, residential mortgage-backed
securities (RMBS) and commercial mortgage-backed securities
(CMBS).
Along with the decline in bond-related losses, pre-tax realized
losses on commercial mortgage loans (CMLs) dropped substantially
in 2011, to $26 million from $1.3 billion in 2010. Cumulative CML
losses totaled about 139 basis points of CML assets over the 2008-
2011 period, a relatively modest amount compared with previous
downturns in the commercial real estate market.
In 2012, US life insurers will continue to see ongoing losses on
their structured RMBS and CMBS securities, as well as on European
sovereign and bank exposures. Barring a double-dip recession,
however, bond and preferred stock credit losses in 2012 are
expected to be in the range of 20-30 basis points of fixed-income
assets, moving in line with the industry's long-term average.
* S&P's Global Corporate Default Tally Rises to 34
--------------------------------------------------
The 2012 global corporate default tally increased to 34 issuers
after a confidentially rated metals and mining company based in
the emerging markets defaulted, said an article published by
Standard & Poor's Global Fixed Income Research, titled "The
Emerging Markets Contribute Another Corporate Default This Week,
Global Tally Rises To 34 Issuers."
This tally, which is more than double that of the same period last
year (through June 13), has seen a sharp rise in corporate
defaults in the emerging markets as of late. Indeed, all three
corporate defaults in the past three weeks were based in the
emerging markets, and the region accounts for one out of four of
all defaulted corporate issuers so far in 2012. In comparison,
the emerging markets accounted for one out of eight corporate
issuers in the same period last year and one out of 20 in all of
2011.
Of the total defaults this year, 20 were based in the U.S., eight
in the emerging markets, four in Europe, and two in the other
developed region (Australia, Canada, Japan, and New Zealand). In
comparison, last year, only 16 issuers -- 10 based in the U.S.,
two in New Zealand, two in the emerging markets, one in Europe,
and one in Canada -- defaulted during the same period (through
June 13).
So far this year, missed payments accounted for 12 defaults,
bankruptcy filings accounted for six, distressed exchanges
accounted for six, and another six defaulters were confidential.
The remaining four entities defaulted for various other reasons.
* K&L Gates' B. Finkelstein Moves to Dykema Gossett in Dallas
-------------------------------------------------------------
Dykema Gossett PLLC announced on June 6 the addition of Bill
Finkelstein to its Corporate Finance Practice Group as a member in
the Firm's Dallas office. Prior to joining Dykema, Finkelstein was
a partner with K&L Gates LLP, having practiced for 33 years with
Hughes & Luce LLP before its merger with K&L Gates in 2008.
In addition to providing general business advice, Finkelstein
focuses his practice on counseling clients on commercial
transactions, acquisitions and minimizing insolvency risks in
structuring business transactions, representing clients in
acquisitions of businesses and assets from troubled companies, and
representing official committees in bankruptcy cases. His clients
span a broad range of industries, including manufacturing, metals
recycling, jewelry, retail, medical-dental equipment, and real
estate.
"Bill is a highly regarded attorney who brings to Dykema nearly
four decades of experience in advising clients on many different
aspects of business and financial transactions, especially
bankruptcy and restructuring,? said Darrell E. Jordan, Managing
Member of Dykema's Dallas office. "His arrival to Dykema, combined
with the recent addition of David Schenck, former Deputy Attorney
General for Legal Counsel to the Texas Attorney General,
reinforces the Firm's commitment to growing the Dallas office with
high-caliber attorneys across a number of key practice groups.?
"Bill's vast experience, particularly working with middle-market
businesses and entrepreneurs throughout Texas, will strengthen our
already leading corporate finance capabilities not only in the
Southwest, but also nationally,? said Brendan J. Cahill, Leader of
Dykema's Corporate Finance Practice Group. "We're pleased to
welcome him to the Firm.?
Finkelstein has substantial experience representing businesses,
investors and financial institutions in workout transactions,
restructurings, bankruptcies and litigation. He has represented
lenders, exporters and importers and technology-based firms in a
wide variety of commercial litigation and insolvency matters.
Previously, Finkelstein served as a law clerk for the Honorable
Thomas M. Reavley, then Associate Justice of the Supreme Court of
Texas. Finkelstein is a member of the American Bankruptcy
Institute and the Association of Commercial Finance Attorneys. He
is a member of the Dallas Board of Israel Bonds and the Jewish
Federation Greater Dallas. He also serves on the Advisory Board of
the University of North Texas Jewish Studies Program.
He received a J.D., cum laude, graduating second in his class,
from Baylor Law School and a B.A. from The University of Texas.
* Year's Bank Failures Hit 31 After 3 Failed Friday
---------------------------------------------------
Three banks failed on Friday, bringing this year's total number of
bank failures to 31.
The Florida Office of Financial Regulation closed Putnam State
Bank of Palatka, which had $165.9 million in total assets and $160
million in deposits. The Federal Deposit Insurance Corp. was
appointed receiver, and sold the failed institution's deposits to
Harbor Community Bank of Indiantown, Fla.
State regulators in Georgia shuttered Security Exchange Bank of
Marietta, which had total assets of $151.0 million and $147.9
million in deposits. The FDIC was appointed receiver and sold the
failed bank to Fidelity Bank of Atlanta.
The Tennessee Department of Financial Institutions shut down The
Farmers Bank of Lynchburg. As receiver, the FDIC sold the failed
institution's deposits for a 1% premium to Clayton Bank and Trust
of Knoxville, Tenn. Clayton Bank and Trust also agreed to assume
the failed bank's assets, and the FDIC estimated the cost of the
failure of The Farmers Bank of Lynchburg to the deposit insurance
fund would be $28.3 million.
2012 Failed Banks List
The FDIC was appointed as receiver for the closed banks. To
protect the depositors, the FDIC entered into a purchase and
assumption agreement with various banks that agreed to assume the
deposits of most of the closed banks. The FDIC also entered into
loss-share transactions on assets bought by the banks.
For this year, the failed banks are:
Loss-Share
Transaction Party FDIC Cost
Assets of Bank That Assumed to Insurance
Closed Bank Deposits & Bought Fund
Closed Bank (millions) Certain Assets (millions)
----------- ----------- ----------------- ------------
The Farmers Bank $163.9 Clayton Bank and Trust $28.3
Security Exchange Bank $151.0 Fidelity Bank $34.3
Putnam State Bank $169.5 Harbor Community Bank $37.4
Waccamaw Bank $533.1 First Community Bank $51.1
Farmers' and Traders' $43.1 First State Bank $8.9
First Capital Bank $46.1 F & M Bank $5.6
Carolina Federal $54.4 Bank of North Carolina $15.2
Alabama Trust Bank $51.6 Southern States Bank $8.9
Security Bank, N.A. $101.0 Banesco USA $10.8
Plantation Federal $486.4 First Federal Bank $76.0
Inter Savings Bank $473.0 Great Southern Bank $117.5
Bank of the Est. Shore $166.7 [No Acquirer] $41.8
Palm Desert Nat'l $125.8 Pacific Premier Bank $20.1
HarVest Bank of Md. $164.3 Sonabank $17.2
Fort Lee Federal $51.9 Alma Bank $14.0
Fidelity Bank $818.2 The Huntington Nat'l $92.8
Premier Bank $268.7 Int'l Bank of Chi. $64.1
Covenant Bank $95.7 Stearns Bank, N.A. $31.5
New City Bank $71.2 [No Acquirer] $17.4
Global Commerce Bank $143.7 Metro City Bank $17.9
Central Bank of Georgia $278.9 Ameris Bank $67.5
Home Savings of Amer. $434.1 [No Acquirer] $38.8
Charter National Bank $93.9 Barrington Bank $17.4
SCB Bank $182.6 First Merchants Bank $33.9
Patriot Bank $111.3 First Resource Bank $32.6
BankEast $272.6 U.S. Bank N.A. $75.6
Tennessee Commerce $1,185.0 Republic Bank & Trust $416.8
First Guaranty Bank $377.9 CenterState Bank $82.0
American Eagle $19.6 Capital Bank, N.A. $3.2
The First State Bank $416.8 Hamilton State Bank $416.8
Central Florida $79.1 CenterState Bank $24.4
In 2011 there were 92 failed banks, compared with 157 in 2010, 140
in 2009 and just 25 for 2008.
The failures in 2010 were the most since 1992, when 179
institutions were taken over by regulators.
A complete list of banks that failed since 2000 is available at:
http://www.fdic.gov/bank/individual/failed/banklist.html
813 Banks in Problem List
The FDIC's Quarterly Banking Profile for Dec. 31, 2011, says that
The number of institutions on the FDIC's "Problem List" declined
from 844 to 813 during the quarter, and total assets of "problem"
institutions fell from $339 billion to $319.4 billion. The number
of institutions in the "problem list" has decreased for the third
consecutive quarter.
The FDIC defines "problem" institutions as those with financial,
operational or managerial weaknesses that threaten their
viability.
The deposit insurance fund, which protects customer holdings up to
$250,000 per account in the event of a failure, saw its balance
increase in the fourth quarter to $9.2 billion (unaudited) from
$7.8 billion in the third quarter, the eighth consecutive
quarterly increase.
Problem Institutions Failed Institutions
-------------------- -------------------
Year Number Assets (Mil) Number Assets (Mil)
---- ------ ------------ ------ ------------
2011 813 $319,432 92 $34,923
2010 884 $390,017 157 $92,085
2009 702 $402,800 140 $169,700
2008 252 $159,405 25 $371,945
2007 76 $22,189 3 $2,615
2006 50 $8,265 0 $0
2005 52 $6,607 0 $0
2004 80 $28,250 4 $170
Federal regulators assign a composite rating to each financial
institution, based upon an evaluation of financial and operational
criteria. The rating is based on a scale of 1 to 5 in ascending
order of supervisory concern. "Problem" institutions are those
institutions with financial, operational, or managerial weaknesses
that threaten their continued financial viability. Depending upon
the degree of risk and supervisory concern, they are rated either
a "4" or "5." The number and assets of "problem" institutions are
based on FDIC composite ratings. Prior to March 31, 2008, for
institutions whose primary federal regulator was the OTS, the OTS
composite rating was used.
* Large Companies With Insolvent Balance Sheets
-----------------------------------------------
Total
Share- Total
Total Holders' Working
Assets Equity Capital
Company Ticker ($MM) ($MM) ($MM)
------- ------ ------ -------- -------
ABSOLUTE SOFTWRE ABT CN 127.2 (3.2) 14.0
ACCO BRANDS CORP ACCO US 1,044.9 (68.3) 311.8
AMC NETWORKS-A AMCX US 2,125.8 (1,004.9) 506.4
AMER AXLE & MFG AXL US 2,502.3 (376.4) 264.6
AMER RESTAUR-LP ICTPU US 33.5 (4.0) (6.2)
AMERISTAR CASINO ASCA US 2,026.3 (45.8) (13.5)
ARRAY BIOPHARMA ARRY US 120.0 (78.8) 28.4
ATLATSA RESOURCE ATL SJ 920.8 (233.7) 20.0
AUTOZONE INC AZO US 6,148.9 (1,416.8) (623.1)
BAZAARVOICE INC BV US 46.8 (15.4) (18.2)
BOSTON PIZZA R-U BPF-U CN 166.1 (91.7) (1.5)
CABLEVISION SY-A CVC US 7,088.5 (5,609.6) (218.0)
CAPMARK FINANCIA CPMK US 20,085.1 (933.1) -
CARMIKE CINEMAS CKEC US 420.8 (1.9) (26.1)
CC MEDIA-A CCMO US 16,489.3 (7,802.6) 1,550.1
CENTENNIAL COMM CYCL US 1,480.9 (925.9) (52.1)
CHENIERE ENERGY CQP US 1,762.3 (574.9) 31.7
CHOICE HOTELS CHH US 443.2 (26.2) 2.1
CIENA CORP CIEN US 1,918.3 (21.1) 918.6
CINCINNATI BELL CBB US 2,657.9 (701.3) (42.6)
CLOROX CO CLX US 4,386.0 (106.0) (689.0)
CROWN HOLDINGS I CCK US 7,178.0 (82.0) 731.0
DEAN FOODS CO DF US 5,758.6 (52.7) 296.0
DELTA AIR LI DAL US 44,189.0 (1,011.0) (5,347.0)
DENNY'S CORP DENN US 336.2 (2.6) (16.3)
DIRECTV-A DTV US 21,912.0 (3,377.0) 1,210.0
DISH NETWORK-A DISH US 12,409.5 (55.6) 778.4
DISH NETWORK-A EOT GR 12,409.5 (55.6) 778.4
DOMINO'S PIZZA DPZ US 601.3 (1,365.7) 58.8
DUN & BRADSTREET DNB US 1,903.8 (628.3) (261.0)
EDGEN GROUP INC EDG US 555.6 (154.7) 267.4
FIESTA RESTAURAN FRGI US 364.8 (3.2) (9.0)
FIFTH & PACIFIC FNP US 796.8 (161.9) 9.7
FREESCALE SEMICO FSL US 3,371.0 (4,472.0) 1,444.0
GENCORP INC GY US 931.2 (189.7) 108.9
GLG PARTNERS INC GLG US 400.0 (285.6) 156.9
GLG PARTNERS-UTS GLG/U US 400.0 (285.6) 156.9
GOLD RESERVE INC GRZ CN 78.3 (25.8) 56.9
GOLD RESERVE INC GRZ US 78.3 (25.8) 56.9
GRAHAM PACKAGING GRM US 2,947.5 (520.8) 298.5
HCA HOLDINGS INC HCA US 27,139.0 (7,324.0) 1,667.0
HUGHES TELEMATIC HUTC US 94.0 (111.8) (39.0)
HUGHES TELEMATIC HUTCU US 94.0 (111.8) (39.0)
INCYTE CORP INCY US 293.6 (248.9) 133.9
IPCS INC IPCS US 559.2 (33.0) 72.1
ISTA PHARMACEUTI ISTA US 124.7 (64.8) 2.2
JUST ENERGY GROU JE CN 1,644.4 (394.5) (338.4)
JUST ENERGY GROU JE US 1,644.4 (394.5) (338.4)
LIVEWIRE ERGOGEN LVVV US 0.1 (0.7) (0.7)
LORILLARD INC LO US 3,351.0 (1,666.0) 919.0
MARRIOTT INTL-A MAR US 6,171.0 (848.0) (1,442.0)
MEAD JOHNSON MJN US 2,866.7 (28.5) 635.2
MERITOR INC MTOR US 2,565.0 (945.0) 193.0
MERRIMACK PHARMA MACK US 64.4 (43.6) 21.0
MONEYGRAM INTERN MGI US 5,136.2 (92.5) (16.2)
NATIONAL CINEMED NCMI US 788.5 (347.4) 102.6
NAVISTAR INTL NAV US 11,503.0 (190.0) 2,238.0
NEXSTAR BROADC-A NXST US 578.2 (179.9) 34.5
NOVADAQ TECHNOLO NDQ CN 23.5 (3.9) 7.5
NPS PHARM INC NPSP US 183.3 (54.4) 130.0
NYMOX PHARMACEUT NYMX US 6.4 (5.2) 2.9
ODYSSEY MARINE OMEX US 21.9 (14.2) (13.9)
OMEROS CORP OMER US 21.1 (12.7) 1.0
ORGANOVO HOLDING ONVO US 0.0 (0.1) (0.1)
PALM INC PALM US 1,007.2 (6.2) 141.7
PDL BIOPHARMA IN PDLI US 235.0 (243.8) 56.6
PEER REVIEW MEDI PRVW US 1.4 (3.4) (3.8)
PLAYBOY ENTERP-A PLA/A US 165.8 (54.4) (16.9)
PLAYBOY ENTERP-B PLA US 165.8 (54.4) (16.9)
PRIMEDIA INC PRM US 208.0 (91.7) 3.6
PROOFPOINT INC PFPT US 64.7 (29.1) (33.7)
PROTECTION ONE PONE US 562.9 (61.8) (7.6)
QUALITY DISTRIBU QLTY US 330.8 (67.6) 54.5
REGAL ENTERTAI-A RGC US 2,307.0 (552.6) 46.5
RENAISSANCE LEA RLRN US 57.0 (28.2) (31.4)
REVLON INC-A REV US 1,156.7 (679.6) 184.9
REXNORD CORP RXN US 3,290.9 (80.8) 551.0
RURAL/METRO CORP RURL US 303.7 (92.1) 72.4
SALLY BEAUTY HOL SBH US 1,789.9 (69.2) 478.8
SINCLAIR BROAD-A SBGI US 1,771.2 (87.2) 3.9
SPLUNK INC SPLK US 82.2 (0.7) 1.1
TAUBMAN CENTERS TCO US 3,096.4 (275.8) -
THRESHOLD PHARMA THLD US 89.7 (77.4) 72.8
UNISYS CORP UIS US 2,455.6 (1,240.4) 430.5
VECTOR GROUP LTD VGR US 886.1 (132.7) 145.6
VERISIGN INC VRSN US 1,882.8 (71.3) 831.1
VERISK ANALYTI-A VRSK US 1,892.0 (10.3) (147.7)
VIRGIN MOBILE-A VM US 307.4 (244.2) (138.3)
WEIGHT WATCHERS WTW US 1,176.1 (1,856.8) (1,057.9)
*********
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.
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*** End of Transmission ***