/raid1/www/Hosts/bankrupt/TCR_Public/121220.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Thursday, December 20, 2012, Vol. 16, No. 353
Headlines
A&S GROUP: Wants to Sell Inventory and Equipment Via Private Sale
ABITIBIBOWATER INC: Levin Group Not Entitled to 2% Merger Fee
ALCOA INC: Moody's Reviews 'Ba2' Pref. Stock Rating for Downgrade
ALETHEIA RESEARCH: U.S. Trustee Asks Court to Toss Chapter 11
AMERICAN AIRLINES: American Eagle Presents New Labor Contracts
AMERICAN AIRLINES: Pilots' Group Balk at New Contract
AMERICAN AIRLINES: Pilots' Group Blocking Removal of Lump Sum
AMERICAN INT'L GROUP: U.S. Treasury Completes Final Sale of Stock
AMERICAN REALTY: S&P Keeps 'BB' Corp. Credit Rating on Watch Pos
AMPAL-AMERICAN: Court OKs Brown Rudnick as Committee Counsel
AMPAL-AMERICAN: Has OK to Hire Bryan Cave as Attorneys
AMR CORP: Reports November 2012 Revenue and Traffic Results
ARCHDIOCESE OF MILWAUKEE: Fails to Reach Deal in Mediation
ARCHDIOCESE OF MILWAUKEE: Dist. Court Junks Settled Claim
ARCHDIOCESE OF MILWAUKEE: Bankr. Court Rules on Jury Trial Issue
ARCHDIOCESE OF MILWAUKEE: Files Operating Reports for Jan. to Nov.
ASSOCIATED NURSING: Wins $890,000 Judgment Against Founder
ATP OIL: Equity Committee Wants Diamond McCarthy as Counsel
ATP OIL: Equity Committee Taps Gordian Group as Financial Advisor
ATP OIL: Has Nod to Hire Slattery Marino as Regulatory Counsel
AURORA DIAGNOSTICS: Moody's Alters Ratings Outlook to Negative
AVAYA INC: Moody's Rates New Senior Secured Note Offering 'B1'
AVAYA INC: S&P Rates Proposed Term Loan and Secured Notes 'B'
BAKERS FOOTWEAR: Panel Hiring Polsinelli Shughart as Co-Counsel
BAKERS FOOTWEAR: Panel Hires BDO Consulting as Financial Advisors
BANKATLANTIC BANCORP: D. Friedman Named Chief Accounting Officer
BENADA ALUMINUM: Committee Can Hire Miles & Stockbridge as Counsel
BENADA ALUMINUM: Court Approves Bush Ross as Committee Counsel
BERNARD L. MADOFF: Peter A "Victim" of Brother's Crime
BERNARD L. MADOFF: Victim Blasts $220-Mil. Levy Settlement
BERNARD L. MADOFF: Investors to Get $85MM More From Merkin Funds
BERKELEY COFFEE: Incurs $110,000 Net Loss in Oct. 31 Quarter
BROADCAST INTERNATIONAL: Extends Current Contract for 2 Months
BROADWAY FINANCIAL: Wellington No Longer Owns Common Shares
CAESARS ENTERTAINMENT: Completes $750MM Senior Notes Offering
CAESARS ENTERTAINMENT: Board OKs Stock Option Award to EVP & CFO
CAPABILITY RANCH: Court Approves Gordon Silver as Counsel
CAPITAL GROUP: Incurs $596,000 Net Loss in Sept. 30 Quarter
CATASYS INC: David Smith Discloses 40.8% Equity Stake
CENVEO CORP: Moody's Rates New Add-on Term Loan 'Ba3'
CHILE MINING: Selling Ana Maria Plant Produced Copper to Madeco
CHAMPION INDUSTRIES: Issues Class B Warrants to Secured Lenders
CHRIST HOSPITAL: Has Until Jan. 18 to File Chapter 11 Plan
CIRTRAN CORP: Court Dismisses Play Beverages Chapter 7 Case
COASTAL PLAINS: Bank Lender's Suit Goes to Trial
COMMUNITY CENTRAL: Knight Capital Discloses 10.7% Equity Stake
CLEARWIRE CORP: Craig McCaw Owns Less Than 1% of Class A Shares
CRAVEN PROPERTIES: Files Schedules of Assets and Liabilities
CROWN CASTLE: Amended Facility No Impact on Moody's 'Ba2' CFR
D MEDICAL INDUSTRIES: Had NIS3 Million Net Loss in 3rd Quarter
DEMCO INC: Sec. 341 Creditors' Meeting Set for Feb. 15
DETROIT, MI: To Receive $10 Million, Review from State
DEX ONE: Fails to Comply with NYSE's $1 Average Share Price Rule
DEX ONE: Restructuring Capital Discloses 9.1% Equity Stake
DREIER LLP: Has Nod to Hire Constellation as Advisor, Witness
DIGITAL DOMAIN: Has Nod to Hire Thomas Johnson as Appraiser
DIGITAL DOMAIN: Has Court OK for DeSantis Commercial as Broker
DIGITAL DOMAIN: Has Nod to Hire Heritage Global as Sales Agent
DIGITAL DOMAIN: Can Hire MDT Executive as Financial Advisor
DYNEGY INC: Files Ch. 11 Liquidation Plan for NY Subsidiaries
EASTMAN KODAK: Judge OKs $830MM Financing Commitment Letter
EDISON MISSION: Moody's Cuts PDR to 'D' on Bankruptcy Filing
ELITE PHARMACEUTICALS: CEO Hikes Bridge Loan to $1 Million
ENERGY FUTURE: Promotes McFarland to Pres. & CEO of Luminant
EP ENERGY: S&P Rates New $350-Mil. PIK Notes Due 2017 'B'
EPE HOLDINGS: Moody's Rates $350MM Senior PIK Toggle Note 'B3'
EXIDE TECHNOLOGIES: Moody's Affirms 'B3' CFR/PDR; Outlook Neg.
FAIR FINANCE: Former CEO Has No Money to Appeal Conviction
FIFTH SEASON: Incurs $3.8-Mil. Net Loss in Third Quarter
FLORIDA KEYS: S&P Withdraws 'BB+' Rating on Series 2010 Rev Bonds
FREDERICK'S OF HOLLYWOOD: Incurs $5.1MM Net Loss in Oct. 27 Qtr.
GAS & OIL: Ohio Appeals Court Affirms Ruling in DeCaprio Suit
GENERAL GROWTH: S&P Affirms 'BB' Corporate Credit Rating
GEOKINETICS HOLDINGS: Moody's Downgrades CFR/PDR to 'Ca'
GEOKINETICS HOLDINGS: S&P Cuts CCR to 'D' on Missed Payment
GEOKINETICS INC: Alejandra Veltmann Named VP and CAO
GIBSON ENERGY: S&P Revises Outlook on 'BB-' CCR to Positive
GMX RESOURCES: OKs Issue of New Series of 2017 Senior Notes
GRANITE DELLS: Jan. 9 Hearing on Arizona Eco's Plan Outline
GULFPORT ENERGY: Moody's Rates $50-Mil. Sr. Unsecured Notes 'B3'
GULFPORT ENERGY: S&P Keeps 'CCC+' Rating on $300MM Unsecured Notes
HAWKER BEECHCRAFT: Approved to Satisfy Exit Facility Obligations
HOSTESS BRANDS: Bakers Union Vows to Appeal Wind-Down Order
IMAGENETIX INC: Files for Chapter 11 Protection
INERGETICS INC: Transfer of $2.2-Mil. NJ Tax Benefits Okayed
INTERNATIONAL FUEL: Five Directors Elected to Board
JHK INVESTMENT: Can Hire Zeisler & Zeisler as Counsel
K-V PHARMACEUTICAL: Susquehanna Affiliate Has Better Loan Option
K-V PHARMACEUTICAL: Inks $60MM Settlement Agreement With Hologic
KINDERHOOK PARTNERS: IDQ Buyout No Impact on Moody's 'B3' CFR
KIRCH GROUP: German Court Orders Deutsche Bank to Pay Damages
LA JOLLA: Stockholders Waive 12-Month Redemption Rights
LANDRY'S HOLDINGS: Moody's Rates $210MM Sr. Unsec. Notes 'Caa1'
LANDRY'S HOLDINGS: S&P Rates $210MM Unsecured Notes 'CCC+'
LCI HOLDING: Hires KPMG LLP for Audit and Tax Consulting Matters
LCI HOLDING: Proposes Rothschild as Investment Banker
LCI HOLDING: Taps Young Conaway as Conflicts Counsel
LEHMAN BROTHERS: NY AG Can't Compel E&Y to Disgorge Fees
LEHMAN BROTHERS: $360-Mil. Settlement With Citigroup Approved
LEHMAN BROTHERS: $1.351-Bil. Recovered via ADR Settlements
LEONARD M. ROSS: Insurer Prevails in Appeals Court
LEVI STRAUSS: Moody's Corrects October 23 Rating Release
LITHIUM TECHNOLOGY: Investors Convert $12.5MM Notes Into Equity
LODGENET INTERACTIVE: Likely to File for Ch. 11 Protection
LOS ANGELES DODGERS: Dewey Gets $500K Bonus for Bankruptcy Work
LSP ENERGY: Gets OK to Cut Purchase Price on Mississippi Plant
LUKE CUSACK: Court Vacates Rule 2004 Examination Order
LUX DIGITAL: Silberstein Ungar Raises Going Concern Doubt
MARK ROBERTS ZIEGLER: Has Green Light to Use Cash Collateral
MAXUM PETROLEUM: S&P Raises Corporate Credit Rating to 'B+'
MEDIA GENERAL: Signs Affiliation Agreement With NBCUniversal
MERISEL INC: Saints Capital Discloses 69.3% Equity Stake
METEX MFG: Has Court's Nod to Hire Reed Smith as Attorney
MGM RESORTS: Inks $1.2-Bil. Underwriting Agreement with JP Morgan
MILLENNIUM INORGANIC: S&P Ups Rating on Second-Lien Debt to 'BB-'
MORGAN'S FOODS: Appoints New Chairman and Interim CEO
MMRGLOBAL INC: Unit Has New License Agreement With 4medica
MOUNTAIN PROVINCE: Obtains Support for Gahcho Kue Project
MSR RESORT: Inks Stipulation for Continued Cash Use Until Jan. 31
MTS LAND: Plan Proposes Full Payment to Unsecured Creditors
MUSCLEPHARM CORP: Enters Into $1 Million Bridge Facility
NASH FINCH: Moody's Affirms 'Ba3' CFR/PDR; Outlook Negative
NAVISTAR INTERNATIONAL: Appoints Samuel Merksamer to Board
NEWPAGE CORP: S&P Gives $500MM Secured Loan Prelim. 'BB' Rating
NEXSTAR BROADCASTING: Silver Point Owns 7.8% of Class A Shares
NFR ENERGY: Moody's Rates New Term Loan 'Caa1'; Outlook Negative
NFR ENERGY: S&P Revises Outlook on 'B' CCR to Stable
NIELSEN HOLDINGS: S&P Puts 'BB' CCR on Watch Neg. on Arbitron Pact
NORTHCORE TECHNOLOGIES: Appoints J. Moskos as Interim CEO
NORTHSTAR AEROSPACE: Wants Purchasers to Comply with Sale Order
NORTHWESTERN STONE: Files Third Amended Reorganization Plan
NPS PHARMACEUTICALS: Adopts Majority Votes for Director Nominees
NRG ENERGY: Fitch Affirms 'B+' Issuer Default Ratings
OIL STATES: Moody's Rates $300-Mil. Sr. Unsecured Notes 'Ba3'
OIL STATES: S&P Raises CCR to 'BB+'; Rates New $300MM Notes 'BB+'
OPEN RANGE: Ch. 7 Trustee Inks Deal With Lender to Resolve Claim
ORCHARD SUPPLY: Incurs $53.6-Mil. Net Loss in Q3 Ended Oct. 27
OVERSEAS SHIPHOLDING: Seeks Approval of Bankruptcy Advisors
PACIFIC RIM: Incurs $1.4-Mil. Net Loss in Fiscal Second Quarter
PEAK RESORTS: Asks Court to Approve Fresh FDIC Financing
QUANTUM CORP: Capital Research No Longer Owns Shares
RCS CAPITAL: Krynski Steps Down From Creditor's Committee
READER'S DIGEST: Moody's Cuts CFR to 'Caa3'; Outlook Negative
RESIDENTIAL CAPITAL: Noteholders Balk at Request to Tap Mediator
RESIDENTIAL CAPITAL: Rejecting Frost Servicing Agreement
RESIDENTIAL CAPITAL: AIG Wants RMBS Fraud Claims Classification
RESIDENTIAL CAPITAL: Panel Can Hire SilvermanAcampora as Counsel
RESIDENTIAL CAPITAL: Papas Fails in Bid for Ch. 7 Conversion
RESIDENTIAL CAPITAL: Farr Sues GMAC Mortgage, et al.
RESIDENTIAL CAPITAL: Dist. Court Stays Maciel Lawsuit vs. GMAC
RICHFIELD EQUITIES: Court Okays Quarton as Investment Banker
RITZ CAMERA: Asks Court OK to Convert Case to Chapter 7
RITZ CAMERA: Has OK to Hire Hilco to Sell Topeka, Kansas Property
ROTECH HEALTHCARE: Steven Alsene Named CEO and President
SALON MEDIA: Signs Employment Pact with Chief Executive Officer
SAN BERNARDINO: Pendency Plan a 'Sham', CalPERS Says
SATCON TECHNOLOGY: Cash Collateral Access Approved Until March 2
SATCON TECHNOLOGY: Holland & Knight Approved as Committee Counsel
SATCON TECHNOLOGY: Settlement With Great Wall Effective Dec. 7
SATCON TECHNOLOGY: Sullivan Approved as Committee Co-Counsel
SORENSON COMMUNICATIONS: S&P Keeps Prelim. 'B-' Corp Credit Rating
SOUTHERN AIR: Judge Approves Ch. 11 Disclosure Statement
SPRINT NEXTEL: Fitch Keeps Low-B Ratings on Several Facilities
SYNAGRO TECHNOLOGIES: S&P Cuts CCR to 'CCC-' on Covenant Breach
TEJAL INVESTMENT: Bank Can Foreclose on Comfort Inn Hotel
TRIBUNE CO: Removal Period Extended to Jan. 31
TRIBUNE CO: Litigation Trustee Can Use Documents for Lawsuits
TRIBUNE CO: TV Guide Wins Stay Relief to Pursue Patent Lawsuit
TRIBUNE CO: KTLA Inc. Seeks to Expunge Waller's $5-Mil. Claim
TRIBUNE CO: Citigroup Facing Claims Over 2007 Leveraged Buyout
TRIAD GUARANTY: Three Directors Resign from Board
TRIDENT MICROSYSTEMS: Amended Chapter 11 Plan Confirmed
UNI-PIXEL INC: Kevin Douglas Discloses 7.2% Equity Stake
UNIGENE LABORATORIES: CEO Cancels 660,000 Stock Options
UNIGENE LABORATORIES: Taps Canaccord to Explore Strategic Options
UNIGENE LABORATORIES: Reexamination of Fortical Patent Terminated
USEC INC: Security Investors' Ownership Down to 2.32%
VERENIUM CORP: Obtains $22.5-Mil. Secured Financing from Athyrium
VERIFONE SYSTEMS: S&P Revises Outlook on 'BB-' CCR to Positive
VITESSE SEMICONDUCTOR: W. Martin Discloses 18.1% Equity Stake
VITESSE SEMICONDUCTOR: 2013 Annual Meeting Postponed to March 7
VITRO SAB: Wants $1.6BB Judgment vs. Bondholders in Mexican Court
W.R. GRACE: Fresenius Medical Continues to Monitor Case
W.R. GRACE: ARD Specialist Joins Libby's Card Staff
W.R. GRACE: Completes Purchase of Noblestar Assets
WOUND MANAGEMENT: Extends Forbearance with Tonaquint to Jan. 29
WYLDFIRE ENERGY: Files Amended Disclosure Statement
YOUNGWOO MOON: Hotel Owner's Case Converted to Chapter 7
Z TRIM HOLDINGS: Edward Smith Discloses 78.9% Equity Stake
ZALE CORP: Stockholders Elect 8 Directors to Board
ZOGENIX INC: FDA Rejects Zohydro ER for Chronic Pain Management
* Banking Ratings Won't Return to Pre-Crisis Levels, Moody's Says
* Moody's Sees Muted Impact of House Price Declines in Canada
* Moody's Says US Life Insurers Vulnerable to Low Interest Rates
* Moody's Says Negative Accreditation Bring Short-Term Risks
* Moody's Sees More Stable Ratings in Infrastructure Sector
* American College of Bankruptcy Names Robert Lapowsky Fellow
* Recent Small-Dollar & Individual Chapter 11 Filings
*********
A&S GROUP: Wants to Sell Inventory and Equipment Via Private Sale
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A&S Group, Inc., asks the U.S. Bankruptcy Court for the Northern
District of Georgia for authorization to sell inventory and
equipment located at its various locations including Charleston,
South Carolina, Tucker, Georgia, the Atlanta Showroom, and
Birmingham, Alabama, including slabs and tiles, and equipment used
and useful in the operation of Debtor's business.
The Debtor and secured creditor SunTrust Bank determined to sell
the Debtor's assets because of continuing expenses, possible loss
of leases and staleness of inventory.
The Debtor relates Great American Group will sell the assets
through private sales at the best price obtainable by Great
American under terms of an asset disposition agreement, with the
consent of SunTrust Bank. The sales are to be final, without the
necessity of further court approval.
About A&S Group
Tucker, Georgia-based A&S Group, Inc., aka A&S Marbel and Granite
Imports, is an importer and distributor of decorative ceramic tile
and mosaics, and natural stone products, most of which are used
for wall and floor applications and counter and table tops in
residential and commercial properties. The Debtor serves a diverse
customer base including local, regional and national retailers,
home centers, developers and retailers.
The Company filed a Chapter 11 petition (Bankr. N.D. Ga. Case No.
12-72662) in Atlanta, on Sept. 9, 2012. The Debtor is an importer
and distributor of decorative ceramic tile and mosaics, and
natural stone products, most of which are used for wall and floor
applications and counter and table tops in residential and
commercial properties. The Debtor's customer base includes local,
regional and national retailers, home centers, developers and
retailers.
Judge Wendy L. Hagenau oversees the case. The Law Office of A.
Keith Logue, Esq., serves as the Debtor's counsel. The Debtor
disclosed $10,278,149 in assets and $17,580,095 in liabilities as
of the Chapter 11 filing. The petition was signed by Sami
Durukan, president.
ABITIBIBOWATER INC: Levin Group Not Entitled to 2% Merger Fee
-------------------------------------------------------------
Bankruptcy Judge Kevin J. Carey ruled that The Levin Group, L.P.
is not entitled to a 2% transaction fee for its advisory work on
the merger of Bowater Inc. and Abitibi-Consolidated, Inc.
"Applying South Carolina law, I conclude that the Engagement
Agreement is not ambiguous. TLG was to provide strategic and
financial advisory services in return for monthly payments and
Transaction-related services for transactions that were
specifically designated, in writing, by Bowater as being subject
to the 2% transaction fee," Judge Carey said.
Judge Carey declined to hold a trial on the matter. The judge
ruled that the Claims Agent's interpretation of the Engagement
Agreement between Bowater and TLG squares with South Carolina law
and produces the only reasonable reading of the Engagement
Agreement; and the Claims Agent has met its burden of establishing
the absence of a genuine dispute as to any material fact.
TLG argues that there is a wealth of correspondence and other
documents exchanged between TLG and Bowater relating to TLG's
services performed in connection with the Merger. TLG points to
emails, a signed confidentiality agreement, and reports prepared
by TLG as evidence of Bowater's written requests that TLG perform
services related to the Merger. However, Judge Carey asid, TLG
has not provided any evidence that Bowater designated, in writing,
that the Merger was "a transaction subject to Paragraph 2(b)" of
the Engagement Agreement.
A copy of the Court's Dec. 12, 2012 Memorandum is available at
http://is.gd/Gl25Fifrom Leagle.com.
About AbitibiBowater Inc.
AbitibiBowater Inc. -- http://www.abitibibowater.com/-- owns or
operates 18 pulp and paper mills and 24 wood products facilities
located in the United States, Canada and South Korea. Marketing
its products in more than 70 countries, AbitibiBowater is also
among the largest recyclers of old newspapers and magazines in
North America, and has third-party certified 100% of its managed
woodlands to sustainable forest management standards.
AbitibiBowater's shares trade under the stock symbol ABH on both
the New York Stock Exchange and the Toronto Stock Exchange.
The Company and several of its affiliates filed for protection
under Chapter 11 of the U.S. Bankruptcy Code on April 16, 2009
(Bankr. D. Del. Lead Case No. 09-11296). The Company and its
Canadian affiliates commenced parallel restructuring proceedings
under the Companies' Creditors Arrangement Act before the Quebec
Superior Court Commercial Division the next day. Alex F. Morrison
at Ernst & Young, Inc., was appointed CCAA monitor.
Paul, Weiss, Rifkind, Wharton & Garrison LLP, served as the
Debtors' U.S. bankruptcy counsel. Stikeman Elliot LLP, acted as
the Debtors' CCAA counsel. Young, Conaway, Stargatt & Taylor, in
Wilmington, Delaware, served as the Debtors' co-counsel, while
Troutman Sanders LLP in New York, served as the Debtors' conflicts
counsel in the Chapter 11 proceedings. The Debtors' financial
advisors were Advisory Services LP, and their noticing and claims
agent was Epiq Bankruptcy Solutions LLC. The CCAA Monitor's
counsel was Thornton, Grout & Finnigan LLP, in Toronto, Ontario.
Luc A. Despins, Esq., at Paul, Hastings, Janofsky & Walker LLP, in
New York, served as counsel to the Official Committee of Unsecured
Creditors. Jamie L. Edmonson, Esq., GianClaudio Finizio, Esq.,
and Daniel A. O'Brien, Esq., at Bayard, P.A., in Wilmington,
Delaware, served as local counsel to the Creditors Committee.
Abitibi-Consolidated Inc. and various Canadian subsidiaries filed
for protection under Chapter 15 of the U.S. Bankruptcy Code on
April 17, 2009 (Bankr. D. Del. 09-11348). Pauline K. Morgan,
Esq., and Sean T. Greecher, Esq., at Young, Conaway, Stargatt &
Taylor, in Wilmington, represented the Chapter 15 Debtors.
U.S. Bankruptcy Judge Kevin Carey handled the Chapter 11 cases of
AbitibiBowater Inc. and its U.S. affiliates and the Chapter 15
case of ACI, et al.
The U.S. Bankruptcy Court issued an opinion confirming
AbitibiBowater's chapter 11 plan of reorganization on Nov. 22,
2010. The Debtors also obtained approval of their reorganization
plan under the Canadian Companies' Creditors Arrangement Act.
AbitibiBowater emerged from bankruptcy on Dec. 9, 2010.
ALCOA INC: Moody's Reviews 'Ba2' Pref. Stock Rating for Downgrade
-----------------------------------------------------------------
Moody's Investors Service placed Alcoa's Baa3 senior unsecured and
Prime-3 short-term rating under review for downgrade.
On Review for Downgrade:
Issuer: Alcoa Inc.
Commercial Paper, Placed on Review for Downgrade, currently
P-3
Multiple Seniority Shelf, Placed on Review for Downgrade,
currently (P)Baa3
Pref. Stock Preferred Stock, Placed on Review for Downgrade,
currently Ba2
Senior Unsecured Conv./Exch. Bond/Debenture, Placed on
Review for Downgrade, currently Baa3
Senior Unsecured Commercial Paper, Placed on Review for
Downgrade, currently P-3
Senior Unsecured Medium-Term Note Program, Placed on Review
for Downgrade, currently (P)Baa3
Senior Unsecured Regular Bond/Debenture, Placed on Review
for Downgrade, currently Baa3
Issuer: Chelan County Development Corporation, WA
Senior Unsecured Revenue Bonds, Placed on Review for
Downgrade, currently Baa3
Issuer: Iowa Finance Authority
Senior Unsecured Revenue Bonds, Placed on Review for
Downgrade, currently Baa3
Outlook Actions:
Issuer: Alcoa Inc.
Outlook, Changed To Rating Under Review From Stable
Ratings Rationale
The review reflects the challenging headwinds facing Alcoa given
the decline in aluminum prices that has occurred, on a sequential
quarterly basis, through September 30, 2012 (dropping almost 22%
to an average of roughly $0.92/lb from the comparable 2011
average) and the adverse impact this has had on Alcoa's earnings
performance and earnings based debt protection metrics in
particular. Based upon Moody's standard adjustments, EBIT/interest
has declined to 0.8x while debt/EBITDA has increased to roughly 6x
for the twelve months through September 30, 2012 as compared with
2.4x and 3.8x respectively in 2011. Global economic conditions
remain relatively weak and recovery in the aluminum industry
remains slow and uneven. Europe's recession and sovereign debt
crisis, sluggish performance in the US economy and slower growth
in China are expected to continue to adversely impact the aluminum
industry. Moody's does not see a material, sustainable improvement
in aluminum prices over the next several quarters and expect
Alcoa's earnings performance and debt protection metrics to remain
challenged.
Although the midstream Global Flat Rolled Products and downstream
Engineered Products and Solutions segments have generated good
after tax operating income performance and are expected to
continue to exhibit reasonably stability in earnings, the alumina
and primary metals segments remain susceptible to underperformance
given current aluminum prices. Moody's expects prices to remain
range bound within trading levels of approximately
$0.85/lb/$0.95/lb for the next several quarters.
The review will focus on Alcoa's cost position, particularly in
its Alumina and Primary segments, and its ability to improve its
earnings position on its asset base as well as reduce debt to
levels more commensurate with the lower earnings run rate. The
review will also encompass the company's cash outflow
requirements, including capital expenditures and cash payments
under the settlement with the Italian government for Italy
recouping electricity tariffs and overall liquidity position.
The principal methodology used in rating Alcoa was the Global
Mining Industry Methodology published in May 2009.
Headquartered in New York City, New York, Alcoa is a leading
global integrated aluminum producer active in all major aspects of
the industry, including the mining of bauxite, refining into
alumina, smelting and recycling. Through its Global Flat Rolled
Products and Engineered Products and Solutions segments, the
company provides value added products to a diversity of end
markets. Revenues for the twelve months through September 30, 2012
were approximately $24 billion.
ALETHEIA RESEARCH: U.S. Trustee Asks Court to Toss Chapter 11
-------------------------------------------------------------
Marie Beaudette at Dow Jones' DBR Small Cap reports that the U.S.
Justice Department is asking a judge to throw out Aletheia
Research and Management Inc.'s bankruptcy case, saying the state
of California's decision earlier this year to suspend the
company's corporate powers makes it ineligible for Chapter 11
protection.
About Aletheia Research
Aletheia Research and Management, Inc., filed a bare-bones
Chapter 11 petition (Bankr. C.D. Calif. Case No. 12-47718) on
Nov. 11, 2012. Attorneys at Greenberg Glusker represent the
Debtor. The board voted in favor of a bankruptcy filing due to
the company's financial situation and ongoing litigation.
According to the list of top largest unsecured creditors, Proctor
Investments has unliquidated and disputed claims of $16 million on
account of pending litigation.
AMERICAN AIRLINES: American Eagle Presents New Labor Contracts
--------------------------------------------------------------
American Eagle Airlines Inc. and Executive Airlines Inc. asked
the U.S. Bankruptcy Court for the Southern District of New York
to approve a new labor deal with pilots that could help reduce
the airlines' labor costs.
The eight-year labor agreement was approved by pilots on
October 8. The Air Line Pilots Association union, which
represents more than 3,100 American Eagle pilots, said that 75%
of those who cast their ballots chose to ratify the agreement.
According to a court filing, no pay reductions were proposed for
the pilots under the labor agreement. The agreement also covers
changes to the pilots' vacation and sick leave, and retains
retirement savings plan benefits.
The airlines can save as much as $43.1 million annually under the
new labor agreement, according to court papers. A copy of the
agreement is available for free at http://is.gd/mQpNdC
Early this month, American Airlines Inc., another regional
carrier of AMR Corp., sought court approval of its new labor deal
with the Allied Pilots Association union.
The six-year contract, which was approved by 74% of the American
Airlines pilots who cast their votes, will give those pilots a
13.5% stake in the post-bankruptcy company and annual pay raises
while freezing their pension and requiring longer work hours.
Meanwhile, American Airlines expects to save as much as $315
million annually under the contract.
In a related development, American Eagle and Executive Airlines
have also sought court approval of new labor agreements with the
other unions representing flight attendants and other workers.
The Association of Flight Attendants-CWA had said 87% of the
1,700 flight attendants approved their new contract after the
airlines made "substantial improvements" over their original
demand for concessions. The union also won wage increases and
preserved work rules.
The Transport Workers Union of America, which represents fleet
service clerks, aircraft maintenance technicians, ground school
instructors and dispatchers, had also agreed for the ratification
of their labor agreements with the airlines.
The agreements, among other things, provide for increases in base
pay rates for ground school instructors, and flexible pay rates
for fleet service clerks and technicians.
Meanwhile, no change to current pay scales was proposed for the
dispatchers. The deal, however, provides for a 1.5% pay increase
in 2015 and in 2016.
Together with the flight attendants' agreement, the TWUA deals
will save the airlines a total of $21.5 million per year.
Full-text copies of the labor contracts are available without
charge at:
http://bankrupt.com/misc/AMR_CBAEagleFlightAttendants.pdf
http://bankrupt.com/misc/AMR_CBAEagleTWUA.pdf
http://bankrupt.com/misc/AMR_CBAEagleDispatchers.pdf
A court hearing is scheduled for December 21. Objections are due
by December 19.
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: Pilots' Group Balk at New Contract
-----------------------------------------------------
A group of pilots is blocking efforts by American Airlines Inc. to
win court approval of its new labor agreement with pilots.
The group, which consists of pilots hired by American Airlines
prior to November 1, 1983, criticized the company's refusal to
exclude the grievances filed by pilot Larry Scerba from the
settlement proposed under the new labor deal.
Mr. Scerba, who filed the grievances in behalf of the group,
complained about the company's alleged violation of an agreement
with the group and the Allied Pilots Association that prohibits
them from taking any action to reduce the pay or the retirement
benefits received by pilots hired before November 1, 1983.
Stanley Silverstone, Esq., at Sehamn Sehman Meltz & Petersen LLP,
in White Plains, New York, said both the company and the pilots
union "have no right to agree to withdraw, settle or otherwise
dispose of these grievances" in behalf of the group.
"They are violating the Railway Labor Act," the group's lawyer
said in a court filing.
The group asked the bankruptcy court to issue an order excluding
the grievances from the settlement. It also sought court
declaration that any grievances it filed regarding American
Airlines' violation of their agreement are not moot and must be
arbitrated before the American-APA System Board of Adjustment.
The new labor agreement also drew flak from the American
Independent Cockpit Alliance Inc., which represents pilots who
previously worked for Trans World Airlines before it merged with
American Airlines.
Meanwhile, the committee of unsecured creditors expressed support
for court approval of the new labor agreement, saying it will
provide American Airlines with labor cost reductions and work
rule changes the company requires to achieve the goals of its
business plan.
Judge Lane of the U.S. Bankruptcy Court in Manhattan will hold a
hearing on December 19.
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: Pilots' Group Blocking Removal of Lump Sum
-------------------------------------------------------------
A group of pilots is opposing AMR Corp.'s request to remove lump
sum and installment options provided under the pilot retirement
plan of its regional carrier.
AMR, the parent of American Airlines Inc., proposed last month to
remove optional forms of benefit to avoid termination of the
retirement plan. The company, which employs more than 10,000
pilots, expressed fear their continuation could fuel a "massive
wave of pilot retirements."
Stanley Silverstone, Esq., at Seham Seham Meltz & Petersen LLP,
in White Plains, New York, asked Judge Sean Lane to deny the
request with respect to the 172 American Airlines pilots.
The 172 pilots, who were hired by American Airlines prior to
November 1, 1983, are on an approved leave of absence or
disability retirement.
Mr. Silverstone said the group is too small that retention of
their lump sum option couldn't cause a termination of the plan
even if those pilots retired from their jobs.
"Continuing the lump sum payment option for less than 2% of
American's pilots cannot cause the termination of the plan," the
group's lawyer said in a court filing.
American Airlines pilots Richard Smith and Paul Trible also
objected to AMR's request to eliminate the lump sum options.
Mr. Smith, a retired pilot, argued that eliminating his right to
elect the lump sum option is not necessary to address the
company's concern over a possible wave of pilot retirements. Mr.
Trible, meanwhile, said eliminating the lump sum option prevents
pilots from retiring, which "violates the Constitutional
prohibitions against slavery and the denial of due process."
The Allied Pilots Association, which represents more than 10,000
pilots at American Airlines, said it does not oppose the request
so long as the order issued by the bankruptcy court authorizes an
amendment eliminating only those provisions on the optional forms
of benefit.
Meanwhile, AMR drew support from the committee of unsecured
creditors and the Pension Benefit Guaranty Corp. Both believe
amending the retirement plan to eliminate optional forms of
benefit is necessary to avoid termination of the plan.
AMR Asks Court to Overrule Objections
In a court filing, AMR asked Judge Sea Lane to overrule the
objections of Mr. Smith and the pilots represented by the Seham
law firm, saying the labor deal requires the elimination of the
lump sum option for all pilots and does not allow for selective
treatment.
AMR said Mr. Smith also lacks standing to object since he is not
eligible to receive the lump sum option.
The company also asked the bankruptcy court to overrule Mr.
Trible's objection, arguing there is no involuntary servitude
involved and the due process protections apply to government
action and not action by private parties.
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 INT'L GROUP: U.S. Treasury Completes Final Sale of Stock
-----------------------------------------------------------------
American Bankruptcy Institute reports that the U.S. Treasury
Department said on Friday that it has completed its final sale of
common stock in American International Group (AIG), reducing its
shares in the insurer to zero.
About AIG
American International Group, Inc. -- http://www.aig.com/-- is an
international insurance organization with operations in more than
130 countries and jurisdictions. AIG companies serve commercial,
institutional and individual customers through one of the most
extensive worldwide property-casualty networks of any insurer. In
addition, AIG companies are leading providers of life insurance
and retirement services around the world. AIG common stock is
listed on the New York Stock Exchange, as well as the stock
exchanges in Ireland and Tokyo.
At the height of the 2008 financial crisis, AIG experienced a
liquidity crunch when its credit ratings were downgraded below
"AA" levels by Standard & Poor's, Moody's Investors Service and
Fitch Ratings. AIG almost collapsed under the weight of bad bets
it made insuring mortgage-backed securities. The Company,
however, was bailed out by the Federal Reserve, but even after an
initial infusion of $85 billion, losses continued to grow. The
later rescue packages brought the total to $182 billion, making it
the biggest federal bailout in U.S. history. AIG sold off a
number of its businesses and other assets to pay down loans
received from the U.S. government.
AMERICAN REALTY: S&P Keeps 'BB' Corp. Credit Rating on Watch Pos
----------------------------------------------------------------
Standard & Poor's Ratings Services maintained its CreditWatch
positive listing on American Realty Capital Trust Inc. (ARCT) in
advance of the company's acquisition by higher-rated Realty Income
Corp. "We originally placed our 'BB' corporate credit rating on
ARCT on CreditWatch with positive implications on Sept. 7, 2012,
following Realty Income Corp.'s proposal to acquire ARCT. ARCT
does not currently have any rated debt," S&P said.
"The CreditWatch positive listing reflects the likelihood that we
would raise our corporate credit rating on ARCT (BB/Watch Pos/--)
to that of Realty Income (BBB/Stable/--) if Realty Income's
acquisition of ARCT closes as expected in the first quarter of
2013," said credit analyst Eugene Nusinzon. "Both companies'
boards of directors have unanimously approved the transaction and
respective shareholder votes have been scheduled for Jan. 16,
2013."
"The CreditWatch positive listing reflects the likelihood that we
would raise our corporate credit rating on ARCT (BB/Watch Pos/--)
to that of Realty Income (BBB/Stable/--) if Realty Income's
acquisition of ARCT closes as expected in the first quarter of
2013. We would likely subsequently withdraw our corporate credit
rating on ARCT based on our expectation that the company will be
fully integrated into Realty Income," S&P said.
AMPAL-AMERICAN: Court OKs Brown Rudnick as Committee Counsel
------------------------------------------------------------
The Hon. Stuart M. Bernstein of the U.S. Bankruptcy Court for the
Southern District of New York has granted the Official Committee
of Unsecured Creditors in the Chapter 11 case of Ampal-American
Israel Corp. authorization to retain Brown Rudnick LLP as its
counsel.
Edward S. Weisfelner, Esq., an attorney at Brown Rudnick, assures
the Court that the firm is a "disinterested person" as that term
is defined in Section 101(14) of the Bankruptcy Code.
The hourly rates of Brown Rudnick's personnel are:
Edward S. Weisfelner $1,100
Tuvi Keinan $970
Daniel J. Saval $770
Attorneys $475 to $1,100
Paraprofessionals $265 to $370
About Ampal-American
Ampal-American Israel Corporation and its subsidiaries --
http://www.ampal.com/-- acquired interests primarily in
businesses located in Israel or that are Israel-related. Ampal is
seeking opportunistic situations in a variety of industries, with
a focus on energy, chemicals and related sectors. Ampal's goal is
to develop or acquire majority interests in businesses that are
profitable and generate significant free cash flow that Ampal can
control.
Ampal-American filed a voluntary petition for Chapter 11
reorganization (Bankr. S.D.N.Y. Case No. 12-13689) on Aug. 29,
2012, to restructure the Company's Series A, Series B and Series C
debentures. Bankruptcy Judge Stuart M. Bernstein presides over
the case. Lawyers at Bryan Cave LLP, in New York, serve as
counsel to the Debtor.
AMPAL-AMERICAN: Has OK to Hire Bryan Cave as Attorneys
------------------------------------------------------
Ampal-American Israel Corp. sought and obtained permission from
the Hon. Stuart M. Bernstein of the U.S. Bankruptcy Court for the
Southern District of New York to employ Bryan Cave LLP as general
bankruptcy attorney.
Bryan Cave will, among other things:
a. attend meetings and negotiate with representatives of
creditors and other parties in interest;
b. take all necessary action to protect and preserve the
Debtor's estate, including: the prosecution of actions on
the Debtor's behalf; the defense of any action
commenced against the Debtor; negotiations concerning all
litigation in which the Debtor is involved; and
objections to claims filed against the estate;
c. prepare on behalf of the Debtor all motions, answers,
orders, reports, and papers necessary to the
administration of the estate; and
d. negotiate and prepare, on the Debtor's behalf, a plan of
reorganization, disclosure statement, and all related
agreements and documents, and take any necessary action
on behalf of the Debtor to obtain confirmation of the
plan.
Bryan Cave will be paid at these hourly rates:
Kenneth Henderson $860
Stephanie Wickouski $750
Serge Nehama $605
Michelle McMahon $540
Chaeri Tornay $440
Jamila Willis $385
Jessica Fischweicher $375
Partners $540 to $965
Associates & Counsel $360 to $755
Legal Assistants $225 to $315
To the best of the Debtor's knowledge, Bryan Cave is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
About Ampal-American
Ampal-American Israel Corporation and its subsidiaries --
http://www.ampal.com/-- acquired interests primarily in
businesses located in Israel or that are Israel-related. Ampal is
seeking opportunistic situations in a variety of industries, with
a focus on energy, chemicals and related sectors. Ampal's goal is
to develop or acquire majority interests in businesses that are
profitable and generate significant free cash flow that Ampal can
control.
Ampal-American filed a voluntary petition for Chapter 11
reorganization (Bankr. S.D.N.Y. Case No. 12-13689) on Aug. 29,
2012, to restructure the Company's Series A, Series B and Series C
debentures. Bankruptcy Judge Stuart M. Bernstein presides over
the case.
AMR CORP: Reports November 2012 Revenue and Traffic Results
-----------------------------------------------------------
AMR Corporation reported November 2012 consolidated revenue and
traffic results for its principal subsidiary, American Airlines,
Inc., and its wholly owned subsidiary, AMR Eagle Holding
Corporation.
Consolidated capacity and traffic were 1.9% and 0.7% higher year-
over-year respectively, resulting in a consolidated load factor of
80.7%, a decrease of 1.0 points versus the same period last year.
International traffic was 4.6% higher on a 5.2% increase in
capacity, resulting in an international load factor of 78.9%, 0.5
points lower compared to the same period last year. The Atlantic
entity recorded the highest load factor of 79.9%, an increase of
2.3 points versus November 2011.
Domestic load factor decreased 1.5 points to 82.8%, as traffic
decreased 1.2% on 0.6% more capacity.
November's consolidated passenger revenue per available seat mile
(PRASM) decreased an estimated 2.3% versus the same period last
year. American estimates that Hurricane Sandy and the early
November snow storm in the Northeast negatively impacted November
revenues by approximately $25 million, and lowered unit revenue by
1.5 percentage points. Separately, operational disruptions that
took place in late September and early October affected bookings
for November travel, negatively impacting revenues in the month by
an estimated $30 million, and lowered unit revenue by an
additional 1.8 percentage points. American estimates that absent
these events, PRASM in November 2012 would have been approximately
1.0 percent higher than in November 2011.
On a consolidated basis, the company boarded 8.6 million
passengers in November.
A detailed copy of the results are available for free at:
http://is.gd/9wBLki
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).
ARCHDIOCESE OF MILWAUKEE: Fails to Reach Deal in Mediation
----------------------------------------------------------
The Archdiocese of Milwaukee and the official committee
representing sexual-abuse claimants failed to come to a settlement
in mediation, according to court papers filed in late October.
The parties, however, did not disclose the reasons for the failed
talks citing confidentiality of the proceedings.
At a hearing, Bankruptcy Judge Kelly began setting down timetables
for the flood of litigation that will result from the inability to
reach a compromise.
The failed mediation between the Archdiocese and the victims sends
the parties back to the Bankruptcy Court to resume what one court
official has called a scorched earth legal battle, Annysa Johnson
of the Milwaukee Journal Sentinel has reported.
The church and victims -- at 575, they represent the largest class
of creditors in the bankruptcy -- have been in court-ordered
mediation since July 20, the Journal Sentinel noted.
At issue in the mediation is how many of the estimated victims
should be compensated and to what extent. The Journal Sentinel
noted that at least one attorney representing the victims has
said previously that he would not agree to a settlement that did
not also include the release of church documents.
Victims' attorney, Jeffrey Anderson, said the creditors would now
move forward to force the disclosure of thousands of pages of
documents under court seal, and to scrutinize the transfer of
millions of dollars off the church's books into trusts in recent
years, the Journal Sentinel noted.
"This puts us back to where we were, ready to move forward with
all the issues and battles that need to be fought," the Journal
Sentinel said, citing Mr. Anderson, who represents 350 of the
abuse claimants in the bankruptcy.
The Archdiocese, however, remains hopeful a consensual resolution
will ultimately be reached, Jerry Topczewski, chief of staff for
Archbishop Jerome Listecki, said in an e-mail sent to the Journal
Sentinel.
About Archdiocese of Milwaukee
The Diocese of Milwaukee was established on Nov. 28, 1843, and
was elevated to an Archdiocese on Feb. 12, 1875, by Pope Pius
IX. The region served by the Archdiocese consists of 4,758 square
miles in southeast Wisconsin which includes counties Dodge, Fond
du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth,
Washington and Waukesha. There are 657,519 registered Catholics
in the Region.
The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for
Chapter 11 bankruptcy protection (Bankr. E.D. Wisc. Case No.
11-20059) on Jan. 4, 2011, to address claims over sexual abuse
by priests on minors.
The Archdiocese became at least the eighth Roman Catholic diocese
in the U.S. to file for bankruptcy to settle claims from current
and former parishioners who say they were sexually molested by
priests.
Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in
Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The
Official Committee of Unsecured Creditors in the bankruptcy case
has retained Pachulski Stang Ziehl & Jones LLP as its counsel, and
Howard, Solochek & Weber, S.C., as its local counsel.
The Archdiocese estimated assets and debts of $10 million to
$50 million in its Chapter 11 petition.
(Catholic Church Bankruptcy News; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000)
ARCHDIOCESE OF MILWAUKEE: Dist. Court Junks Settled Claim
---------------------------------------------------------
Judge Rudolph Randa of the U.S. District Court for Eastern
District of Wisconsin, in late October, affirmed a ruling by
Bankruptcy Judge Susan Kelley dismissing one victim's claim and
allowing two others to move forward, at least for now, Annysa
Johnson of the Milwaukee Journal Sentinel reported.
The federal judge's ruling meant partial victory for both the
Archdiocese of Milwaukee and the sex abuse victims who make up
the vast majority of creditors in its bankruptcy.
According to the Journal Sentinel, the three cases were seen as
test cases in which the archdiocese argued that a significant
number of victims of clergy sexual abuse had enough information
on the church's handling of cases to have filed fraud claims
years earlier, and that the statute of limitations expired before
those victims stepped forward. The Archdiocese also sought to
exclude cases that involve religious offenders, teachers and
others it does not consider its employees, and cases where the
victims received prior settlements.
A decision to dismiss all three cases would have opened the door
for the archdiocese to remove most of the 574 sex abuse claims
involved in the bankruptcy proceedings, victims and their
attorneys have said, according to the Journal Sentinel.
The lone dismissal -- of a claim in which a victim already
received a $100,000 settlement from the church -- lays the
groundwork for the archdiocese to object to more than 90 claims
by individuals who also signed prior settlement agreements, the
report noted.
A full-text copy of Judge Randa's Decision is available at
http://is.gd/hNjSrmfrom Leagle.com
About Archdiocese of Milwaukee
The Diocese of Milwaukee was established on Nov. 28, 1843, and
was elevated to an Archdiocese on Feb. 12, 1875, by Pope Pius
IX. The region served by the Archdiocese consists of 4,758 square
miles in southeast Wisconsin which includes counties Dodge, Fond
du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth,
Washington and Waukesha. There are 657,519 registered Catholics
in the Region.
The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for
Chapter 11 bankruptcy protection (Bankr. E.D. Wisc. Case No.
11-20059) on Jan. 4, 2011, to address claims over sexual abuse
by priests on minors.
The Archdiocese became at least the eighth Roman Catholic diocese
in the U.S. to file for bankruptcy to settle claims from current
and former parishioners who say they were sexually molested by
priests.
Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in
Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The
Official Committee of Unsecured Creditors in the bankruptcy case
has retained Pachulski Stang Ziehl & Jones LLP as its counsel, and
Howard, Solochek & Weber, S.C., as its local counsel.
The Archdiocese estimated assets and debts of $10 million to
$50 million in its Chapter 11 petition.
(Catholic Church Bankruptcy News; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000)
ARCHDIOCESE OF MILWAUKEE: Bankr. Court Rules on Jury Trial Issue
----------------------------------------------------------------
Bankruptcy Judge Susan Kelley penned a decision in mid-November
holding that 28 U.S.C. Sec. 1411 apply to the "trial" of personal
injury claims. The decision came after a status conference was
conducted to determine the next steps to be taken following the
dismissal of the appeals to the order on the Debtor's objection to
two claims filed by sexual abuse victims.
Prior to the conference, the Official Committee of Unsecured
Creditors and the Claimants filed briefs arguing that if these
Claim Objections move forward, they will require jury trials.
The Committee notes the delay and expense this would entail, and
seeks to delay all claim objection litigation to enable the
estate to aggressively pursue insurance coverage litigation. At
the conference, the Bankruptcy Court disagreed with the
Claimants' and Committee's position.
In bankruptcy court, claim objection proceedings are summary,
equitable proceedings, and the claimants are not entitled to a
jury trial, Bankruptcy Judge Kelley held.
In its brief, the Committee points to 28 U.S.C. Sec. 1411 which,
when read in conjunction with 28 U.S.C. Sec. 157(b)(5), preserves
jury trial rights and limits the Bankruptcy Court's authority to
enter orders liquidating personal injury and wrongful death
claims. But those provisions should be applied in context, Judge
Kelley pointed out.
The judge explained that, as recognized in In re UAL Corp., 310
B.R. 373, 381 (Bankr. N.D. Ill. 2004), "[I]nterpreting the
personal injury exception narrowly -- as removing from bankruptcy
court jurisdiction disputes over the valuation of claims against
the estate but not disputes over their legal validity -- is
consistent with related jurisdictional provisions of Title 28
. . . . Both of these aspects of the provision allow for pretrial
consideration of personal injury tort claims by the bankruptcy
court, including a determination that such a claim is legally
unenforceable. Similarly, the narrower interpretation of the
personal injury exception is consistent with 28 U.S.C. Sec.
1411(a), which preserves the right to jury trial for personal
injury and wrongful death tort claims, since no jury trial right
would attach to a claim disallowed on purely legal grounds."
"Given their sole basis, the Objections do not entail the
liquidation or valuation of the Claims. Rather, by deciding
whether the statute of limitations bars the Claims, the Court is
determining the legal enforceability of the Claims. This
determination does not offend the jury trial requirements of Sec.
1411 that specifically apply to the 'trial' of personal injury
claims," Judge Kelley held.
With regard to the Committee's concern that the insurance
coverage litigation should take priority over the Claim
objections, the Court notes that the Debtor and certain abuse
survivors recently filed a Complaint to determine the coverage
issues. The Court will endeavor to ensure that this adversary
proceeding is processed and scheduled as promptly as possible.
The Claim Objections have been pending for nearly one year.
Resolution of claims against a bankruptcy estate is intended to
be a prompt and efficient procedure, and this case cries out for
an answer for the Claimants and the Debtor. Unless the Debtor
withdraws the Objections or agrees with the Committee that they
should be placed on the "back burner" while other matters are
decided, the Court intends to move forward to decide them.
A copy of the Decision is available at http://is.gd/nwV9Qpfrom
Leagle.com.
About Archdiocese of Milwaukee
The Diocese of Milwaukee was established on Nov. 28, 1843, and
was elevated to an Archdiocese on Feb. 12, 1875, by Pope Pius
IX. The region served by the Archdiocese consists of 4,758 square
miles in southeast Wisconsin which includes counties Dodge, Fond
du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth,
Washington and Waukesha. There are 657,519 registered Catholics
in the Region.
The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for
Chapter 11 bankruptcy protection (Bankr. E.D. Wisc. Case No.
11-20059) on Jan. 4, 2011, to address claims over sexual abuse
by priests on minors.
The Archdiocese became at least the eighth Roman Catholic diocese
in the U.S. to file for bankruptcy to settle claims from current
and former parishioners who say they were sexually molested by
priests.
Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in
Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The
Official Committee of Unsecured Creditors in the bankruptcy case
has retained Pachulski Stang Ziehl & Jones LLP as its counsel, and
Howard, Solochek & Weber, S.C., as its local counsel.
The Archdiocese estimated assets and debts of $10 million to
$50 million in its Chapter 11 petition.
(Catholic Church Bankruptcy News; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000)
ARCHDIOCESE OF MILWAUKEE: Files Operating Reports for Jan. to Nov.
------------------------------------------------------------------
The Archdiocese of Milwaukee disclosed net income (loss) for the
periods from January to November 2012:
Period Net Income (Loss)
------ -----------------
01/01/12-01/31/12 ($1,672,660)
02/01/12-02/28/12 $251,374
03/01/12-03/31/12 $597,940
04/01/12-04/30/12 ($1,039,756)
05/01/12-05/31/12 (1,247,343)
06/01/12-06/30/12 ($138,829)
07/01/12-07/31/12 ($751,282)
08/01/12-08/31/12 ($1,533,932)
09/01/12-09/30/12 ($1,171,862)
10/01/12-10/31/12 $5,182,591
11/01/12-11/30/12 ($1,182,980)
As of Nov. 30, 2012, Milwaukee had $17,214,905 in current assets
and $4,285,434 in current liabilities.
Full-text copies of the monthly operating reports are available
at:
http://bankrupt.com/misc/milkwmorjan2012.pdf
http://bankrupt.com/misc/milkwmorfeb2012.pdf
http://bankrupt.com/misc/milkwmormar2012.pdf
http://bankrupt.com/misc/milkwmorapr2012.pdf
http://bankrupt.com/misc/milkwmormay2012.pdf
http://bankrupt.com/misc/milkwmorjun2012.pdf
http://bankrupt.com/misc/milkwmorjul2012.pdf
http://bankrupt.com/misc/milkwmoraug2012.pdf
http://bankrupt.com/misc/milkwmorsep2012.pdf
http://bankrupt.com/misc/milkwmoroct2012.pdf
http://bankrupt.com/misc/milkwmornov2012.pdf
About Archdiocese of Milwaukee
The Diocese of Milwaukee was established on Nov. 28, 1843, and
was elevated to an Archdiocese on Feb. 12, 1875, by Pope Pius
IX. The region served by the Archdiocese consists of 4,758 square
miles in southeast Wisconsin which includes counties Dodge, Fond
du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth,
Washington and Waukesha. There are 657,519 registered Catholics
in the Region.
The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for
Chapter 11 bankruptcy protection (Bankr. E.D. Wisc. Case No.
11-20059) on Jan. 4, 2011, to address claims over sexual abuse
by priests on minors.
The Archdiocese became at least the eighth Roman Catholic diocese
in the U.S. to file for bankruptcy to settle claims from current
and former parishioners who say they were sexually molested by
priests.
Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in
Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The
Official Committee of Unsecured Creditors in the bankruptcy case
has retained Pachulski Stang Ziehl & Jones LLP as its counsel, and
Howard, Solochek & Weber, S.C., as its local counsel.
The Archdiocese estimated assets and debts of $10 million to
$50 million in its Chapter 11 petition.
(Catholic Church Bankruptcy News; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000)
ASSOCIATED NURSING: Wins $890,000 Judgment Against Founder
----------------------------------------------------------
Bankruptcy Judge David W. Houston, III, ruled that Associated
Nursing, Inc., d/b/a Associated Medical Equipment, d/b/a
Associated Pharmacy, is entitled to a judgment against its
founder, E.L. Garner, Jr., for these sums:
$469,513, which is applicable to the funds Mr. Garner
diverted from Associated Nursing to purchase horses
for use in his cutting horse business; and
$423,775, which is applicable to the funds Mr. Garner
diverted for use in the construction of a barn on
his property.
The Court said a judicial lien is impressed on Mr. Garner's real
property on which the barn is situated as security for the payment
of the $423,775 debt.
Associated Nursing is suing Lee Garner for breach of fiduciary
duty, conversion, mismanagement, and misappropriation. Associated
Nursing alleges Mr. Garner diverted hundreds of thousands of
dollars to himself for the purchase of airplanes, investments, and
for the acquisition of horses for use in connection with his
cutting horse enterprise. Associated Nursing funds were utilized
to pay the expenditures directly or they were deposited into a
bank account of another entity and then utilized to pay the
expenditures.
Mr. Garner takes the position that the investment in the horses
was justified because the horse operation attracted the interest
of numerous physicians who then made business referrals for the
benefit of Associated Nursing.
Mr. Garner also has asserted that he should be entitled to payment
of rent for the years that Associated Nursing occupied an office
building that he now owns. He also asserts that the Court should
determine that he is a 50% owner of Associated Nursing.
For a number of years, Associated Nursing leased office space from
Mrs. Helen Garner, Mr. Garner's mother, under a "triple net" lease
agreement.
In its ruling, the Court granted Mr. Garner a judgment against
Associated Nursing for unpaid rent for a period of three years at
the rate of $1,500 per month in the total sum of $54,000.
According to the Court, the rent will continue monthly beginning
with the December 2012, payment for the time that Associated
Nursing remains in the property. The $54,000 will be offset
against the judgment being awarded to Associated Nursing against
Mr. Garner.
If Associated Nursing wishes to remain at this location, it must
attempt to negotiate a lease agreement with Mr. Garner. In the
event that a mutually agreeable lease cannot be negotiated, then
Associated Nursing must vacate the premises by March 1, 2013.
Rent at the rate of $1,500 per month will be paid until the
property is vacated or until a new agreement is executed.
The Court also held that Mr. Garner's estranged wife, Kathy
Garner, has been the legal owner of 100% of the stock of
Associated Nursing since its incorporation. From what the court
has been able to review in the case file, as well as, through the
admitted exhibits, the counterclaim filed by Mr. Garner failed to
include a request to be awarded a 50% interest in Associated
Nursing. Consequently, the Court declines to divest Kathy Garner
of 50% ownership in the corporation as sought by Mr. Garner
somewhat obscurely in his pleading.
The lawsuit is, ASSOCIATED NURSING, INC., d/b/a ASSOCIATED MEDICAL
EQUIPMENT, d/b/a ASSOCIATED PHARMACY ASSOCIATED NURSING, INC.,
d/b/a ASSOCIATED MEDICAL EQUIPMENT, d/b/a ASSOCIATED PHARMACY,
Plaintiff, v. E.L. GARNER; UNKNOWN AGENTS, EMPLOYEES, AND
REPRESENTATIVES OF ASSOCIATED NURSING, INC., AND CENTRAL LOUISIANA
OXYGEN, INC.; PALMETTO GOVERNMENT BENEFITS ADMINISTRATORS, LLC;
AND UNKNOWN THIRD PARTIES, Defendants, Adv. Proc. No. 99-2234
(Bankr. N.D. Miss.). A copy of the Court's Dec. 14, 2012 Opinion
is available at http://is.gd/h9czMYfrom Leagle.com.
Associated Nursing, Inc., d/b/a Associated Medical Equipment,
d/b/a Associated Pharmacy, was initially incorporated in the late
1980's by Lee Garner and his now estranged wife, Kathy Garner.
The initial purpose of the corporation was to provide private duty
nursing services, but this later changed to the provision of
durable medical equipment and supplies to clients of the
corporation. Because of financial problems experienced by Lee
Garner, 100% of the Associated Nursing corporate stock was owned
by Kathy Garner. However, Lee Garner controlled the day to day
operations of the corporation and made all of its significant
business decisions. Kathy Garner maintained the corporate records
and paid all of the corporate bills.
Associated Nursing filed for Chapter 11 bankruptcy protection
(Bankr. N.D. Miss. Case No. 99-24876).
ATP OIL: Equity Committee Wants Diamond McCarthy as Counsel
-----------------------------------------------------------
The Official Committee of Equity Security Holders in the Chapter
11 case of ATP Oil & Gas Corp. seeks permission from the Hon.
Marvin Isgur of the U.S. Bankruptcy Court for the Southern
District of Texas to retain Diamond McCarthy LLP as counsel,
effective as of Nov. 12, 2012.
Diamond McCarthy will, among other things:
a. assist and advise the Equity Committee in its
negotiations and consultations with the Debtor, creditors
and parties in interest relative to the administration of
the Chapter 11 case;
b. develop and negotiate a Chapter 11 plan of reorganization
with the Debtor, and if appropriate, formulate and file a
plan of reorganization proposed by the Equity Committee;
c. assist with the Equity Committee's investigation of the
acts, conduct, assets, liabilities and financial
condition of the Debtor; and
d. assist, advise and represent the Equity Committee in
analyzing and participating in any proposed asset sales
or dispositions.
Pursuant to the terms of the engagement agreement, the Equity
Committee has agreed to compensate Diamond McCarthy:
a. in connection with the consummation of a Restructuring,
a fee of $1.5 million payable as a condition to
consummation of the restructuring, and only if, there is
a recovery to holders of either preferred equity or
common equity or both;
b. in connection with the consummation of a restructuring, a
fee of 1% of the recovery to preferred equity payable
concurrently with and as a condition to consummation of
the restructuring. This amount will be paid either in
cash in an amount equal to the fair market value of 1% of
the recovery to preferred equity or in-kind in the same
manner and form as and when received by the preferred
equity holders;
c. in connection with the consummation of a restructuring, a
fee of 2.5% of the recovery to common equity payable
concurrently with and as a condition to consummation of
the restructuring. This amount will be paid either in
cash in an amount equal to the fair market value of 2.5%
of the recovery to common equity or in-kind in the same
manner and form as and when received by the common equity
holders.
The Equity Committee said, "For avoidance of doubt, foregoing
contingency fees are additive and all three may be earned."
Kyung S. Lee, Esq., a partner at Diamond McCarthy, attests to the
Court that the firm is a "disinterested person" as that term is
defined in Section 101(14) of the Bankruptcy Code.
About ATP Oil
Houston, Tex.-based ATP Oil & Gas Corporation is an international
offshore oil and gas development and production company focused
in the Gulf of Mexico, Mediterranean Sea and North Sea.
ATP Oil & Gas filed a Chapter 11 petition (Bankr. S.D. Tex. Case
No. 12-36187) on Aug. 17, 2012. Attorneys at Mayer Brown LLP,
serve as bankruptcy counsel. Porter Hedges LLP serves as local
co-counsel. Munsch Hardt Kopf & Harr, P.C., is the conflicts
counsel. Opportune LLP is the financial advisor and Jefferies &
Company is the investment banker. Kurtzman Carson Consultants LLC
is the claims and notice agent. Blackhill Partners, LLC, provided
James R. Latimer, III as chief restructuring officer to the
Debtor. Filings with the Bankruptcy Court and claims information
are available at http://www.kccllc.net/atpog
ATP disclosed assets of $3.6 billion and $3.5 billion of
liabilities as of March 31, 2012. Debt includes $365 million on a
first-lien loan where Credit Suisse AG serves as agent. There is
$1.5 billion on second-lien notes with Bank of New York Mellon
Trust Co. as agent. ATP's other debt includes $35 million on
convertible notes and $23.4 million owing to third parties for
their shares of production revenue. Trade suppliers have claims
for $147 million, ATP said in a court filing.
New financing is being provided by some of the first lien lenders.
An official committee of unsecured creditors has been appointed in
the case. Evan R. Fleck, Esq., at Milbank, Tweed, Hadley &
McCloy, in New York, represents the Creditors Committee as
counsel. Duff & Phelps Securities, LLC, serves as its financial
advisors. The Committee tapped Epiq Bankruptcy Solutions, LLC as
its information agent.
ATP OIL: Equity Committee Taps Gordian Group as Financial Advisor
-----------------------------------------------------------------
The Official Committee of Equity Security Holders in the Chapter
11 case of ATP Oil & Gas Corp. asks the Hon. Marvin Isgur of the
U.S. Bankruptcy Court for the Southern District of Texas for
authorization to retain Gordian Group, LLC, as financial advisors
and investment banker, effective Nov. 12, 2012.
Gordian Group will, among other things:
a) review and analyze the Debtor's business, operations and
financial condition and advise the Equity Committee on
the findings;
b) assist in negotiations with the Debtor, current lenders,
creditors, shareholders and other interested parties
regarding the restructuring;
c) evaluate the Debtor's overall valuation and debt
capacity;
d) provide testimony to the Court, as appropriate and
mutually agreed upon by Gordian and the Equity Committee;
and
e) assist with making presentations to the Equity Committee,
the Debtor, lenders, creditors, equity security holders
and other interested parties regarding any potential
restructuring and other financial issues related thereto.
Pursuant to the Engagement Letter, the Equity Committee had agreed
to compensate Gordian Group: in connection with the consummation
of the Restructuring, fees payable concurrently with and as a
condition to consummation of the restructuring, consisting of 1.5%
of the aggregate consideration up to and including $275 million
plus 3.0% of Aggregate Consideration in excess of $275 million.
Aggregate Consideration, for purposes of calculating the
transaction fees, will be deemed to be the total amounts paid to
or for the benefit of, or otherwise realized by, the company's
equity security holders in connection with the restructuring or
any transaction related thereto. Equity security holders include
holders of the Debtor's preferred stock and common stock.
Peter S. Kaufman, President and Head of the Restructuring and
Distressed M&A practice of Gordian Group, attests to the Court
that the firm is a "disinterested person" as that term is defined
in Section 101(14) of the Bankruptcy Code.
About ATP Oil
Houston, Tex.-based ATP Oil & Gas Corporation is an international
offshore oil and gas development and production company focused
in the Gulf of Mexico, Mediterranean Sea and North Sea.
ATP Oil & Gas filed a Chapter 11 petition (Bankr. S.D. Tex. Case
No. 12-36187) on Aug. 17, 2012. Attorneys at Mayer Brown LLP,
serve as bankruptcy counsel. Porter Hedges LLP serves as local
co-counsel. Munsch Hardt Kopf & Harr, P.C., is the conflicts
counsel. Opportune LLP is the financial advisor and Jefferies &
Company is the investment banker. Kurtzman Carson Consultants LLC
is the claims and notice agent. Blackhill Partners, LLC, provided
James R. Latimer, III as chief restructuring officer to the
Debtor. Filings with the Bankruptcy Court and claims information
are available at http://www.kccllc.net/atpog
ATP disclosed assets of $3.6 billion and $3.5 billion of
liabilities as of March 31, 2012. Debt includes $365 million on a
first-lien loan where Credit Suisse AG serves as agent. There is
$1.5 billion on second-lien notes with Bank of New York Mellon
Trust Co. as agent. ATP's other debt includes $35 million on
convertible notes and $23.4 million owing to third parties for
their shares of production revenue. Trade suppliers have claims
for $147 million, ATP said in a court filing.
New financing is being provided by some of the first lien lenders.
An official committee of unsecured creditors has been appointed in
the case. Evan R. Fleck, Esq., at Milbank, Tweed, Hadley &
McCloy, in New York, represents the Creditors Committee as
counsel. Duff & Phelps Securities, LLC, serves as its financial
advisors. The Committee tapped Epiq Bankruptcy Solutions, LLC as
its information agent.
ATP OIL: Has Nod to Hire Slattery Marino as Regulatory Counsel
--------------------------------------------------------------
The Hon. Marvin Isgur of the U.S. Bankruptcy Court for the
Southern District of Texas has granted ATP Oil & Gas Corporation
permission to employ Slattery, Marino & Roberts as special
counsel, nunc pro tunc to Aug. 27, 2012.
As reported by the Troubled Company Reporter on Oct. 12, 2012,
Slattery Marino's retention is for the limited, special purpose of
providing the Debtor with advice and consultation regarding:
(i) the regulatory agencies and related regulatory matters;
(ii) specific Louisiana legal issues related to same and related
to oil and gas operations in the Gulf of Mexico; and (iii) daily
oil and gas/business issues. The firm will also assist the
Debtor's other professionals in areas for which it has
institutional knowledge and experience.
About ATP Oil
Houston, Tex.-based ATP Oil & Gas Corporation is an international
offshore oil and gas development and production company focused
in the Gulf of Mexico, Mediterranean Sea and North Sea.
ATP Oil & Gas filed a Chapter 11 petition (Bankr. S.D. Tex. Case
No. 12-36187) on Aug. 17, 2012. Attorneys at Mayer Brown LLP,
serve as bankruptcy counsel. Porter Hedges LLP serves as local
co-counsel. Munsch Hardt Kopf & Harr, P.C., is the conflicts
counsel. Opportune LLP is the financial advisor and Jefferies &
Company is the investment banker. Kurtzman Carson Consultants LLC
is the claims and notice agent. Blackhill Partners, LLC, provided
James R. Latimer, III as chief restructuring officer to the
Debtor. Filings with the Bankruptcy Court and claims information
are available at http://www.kccllc.net/atpog
ATP disclosed assets of $3.6 billion and $3.5 billion of
liabilities as of March 31, 2012. Debt includes $365 million on a
first-lien loan where Credit Suisse AG serves as agent. There is
$1.5 billion on second-lien notes with Bank of New York Mellon
Trust Co. as agent. ATP's other debt includes $35 million on
convertible notes and $23.4 million owing to third parties for
their shares of production revenue. Trade suppliers have claims
for $147 million, ATP said in a court filing.
New financing is being provided by some of the first lien lenders.
An official committee of unsecured creditors has been appointed in
the case. Evan R. Fleck, Esq., at Milbank, Tweed, Hadley &
McCloy, in New York, represents the Creditors Committee as
counsel. Duff & Phelps Securities, LLC, serves as its financial
advisors. The Committee tapped Epiq Bankruptcy Solutions, LLC as
its information agent.
AURORA DIAGNOSTICS: Moody's Alters Ratings Outlook to Negative
--------------------------------------------------------------
Moody's Investors Service changed the rating outlook of Aurora
Diagnostics Holdings, LLC and Aurora Diagnostics, LLC
(collectively Aurora) to negative from stable. Moody's also
downgraded Aurora's Speculative Grade Liquidity Rating to SGL-3
from SGL-2. Concurrently, Moody's affirmed Aurora's other ratings,
including the B2 Corporate Family and Probability of Default
Ratings.
The change in the rating outlook to negative reflects Moody's
expectation that the company will see a decline in revenue and
EBITDA related to a reduction in Medicare reimbursement scheduled
to take effect in January 2013. This will negatively impact the
company's credit metrics throughout 2013 and the resulting
reduction in free cash flow will constrain Aurora's ability to
repay debt as remaining contingent earnouts are paid down.
The downgrade of Aurora's Speculative Grade Liquidity Rating
reflects the weakening of the company's liquidity position
resulting from the expected reduction in revenue and cash flow and
the decline in the amount of available revolver following the
company's recent amendment to its credit facility that reduced the
revolver commitment to $60 million from $110 million.
Following is a summary of Moody's rating actions.
Ratings downgraded:
Speculative Grade Liquidity Rating, to SGL-3 from SGL-2
Ratings affirmed and LGD assessment revised:
Aurora Diagnostics Holdings, LLC:
Corporate Family Rating, B2
Probability of Default Rating, B2
Senior unsecured notes due 2018, B3 to (LGD 5, 74%) from (LGD 5,
77%)
Aurora Diagnostics, LLC:
Senior secured revolving credit facility expiring 2015, Ba2 to
(LGD 2, 18%) from (LGD 2, 21%)
Senior secured term loan due 2016, Ba2 to (LGD 2, 18%) from (LGD
2, 21%)
Ratings Rationale
Aurora's B2 Corporate Family Rating reflects Moody's expectation
that the company will continue to operate with considerable
leverage. Moody's expects that metrics will weaken in 2013 as the
company absorbs a reduction in Medicare reimbursement. Moody's
also anticipates that the difficult operating environment,
characterized by considerable competition for pathology services
and slow growth in physician visits will continue in the near
term. However, the rating also reflects the company's healthy
margins, adequate liquidity, the absence of any near term debt
maturities and Moody's expectation of sufficient headroom in
compliance with covenant requirements.
Given the pressures facing the company in the next year, Moody's
does not foresee an upgrade of the rating in the near term.
However, Moody's could upgrade the rating if Aurora is able to
sustain debt to EBITDA below 4.5 times and improve the
availability of free cash flow after funding future obligations
related to contingent payments.
Moody's could downgrade the rating if the company's operating
results were to decline in excess of expectations or liquidity was
expected to deteriorate further. Specifically, Moody's could
downgrade the rating if leverage is expected to be sustained above
6.0 times, if free cash flow is expected to be negative for an
extended period or if compliance with covenant requirements
becomes less certain.
For further details refer to Moody's Credit Opinion for Aurora
Diagnostics Holdings, LLC on moodys.com.
Headquartered in Palm Beach Gardens, Florida, Aurora, through its
subsidiaries, provides physician-based general anatomic and
clinical pathology, dermatopathology, molecular diagnostic
services and other esoteric testing services to physicians,
hospitals, clinical laboratories and surgery centers. The company
recognized approximately $291 million in revenue for the twelve
months ended September 30, 2012
The principal methodology used in rating Aurora Diagnostics was
the Global Business & Consumer Service Industry Rating Methodology
published in October 2010. Other methodologies used include Loss
Given Default for Speculative-Grade Non-Financial Companies in the
U.S., Canada and EMEA published in June 2009.
AVAYA INC: Moody's Rates New Senior Secured Note Offering 'B1'
--------------------------------------------------------------
Moody's Investors Service assigned a B1 rating to Avaya Inc.'s
proposed senior secured note offering. Proceeds of the new notes
will be used to refinance existing senior secured term loans (also
rated B1).
Ratings Rationale
Avaya also recently closed a term loan amendment to extend
approximately $715 million of $1.3 billion of debt maturing in
October 2014. Though the extended debt and new notes only buy
Avaya a definitive nine month extension to July 2015 from October
2014 they provides a mechanism to further extend the maturity to
2017 or 2018 if the company can complete an IPO or refinance $750
million of the unsecured notes due November 2015. Avaya's
corporate family rating remains B3 and the rating outlook remains
negative.
The upcoming 2014 and 2015 maturities remain one of the largest
near term rating concerns given the company's very high leverage
and negative (but improving) free cash flow. Extending the
maturity provides Avaya additional time for the enterprise voice
market to improve and the company's additional margin improving
initiatives to be realized. Unfortunately, the increased interest
expense as a result of the extended loans and new notes come at a
time when the company is facing continued restructuring costs and
breakeven cash flow prospects.
Issuer: Avaya, Inc.
LGD Revisions:
Existing Senior Secured Bank Credit Facilities, revised to a
range of LGD2, 27 % from a range of LGD2, 28 %
US$1009M 7% Senior Secured Regular Bond/Debenture, revised to
a range of LGD2, 27 % from a range of LGD2, 28 %
Assignments:
Amended and Extended Senior Secured Bank Credit Facility
(Term Loan B-5), Assigned B1,LGD2, 27 %
Proposed Senior Secured Regular Bond/Debenture, Assigned B1,
LGD2, 27 %
The principal methodology used in rating Avaya was the Global
Communications Equipment Industry Methodology published in
September 2008. Other methodologies used include Loss Given
Default for Speculative-Grade Non-Financial Companies in the U.S.,
Canada and EMEA published in June 2009.
Avaya is a global leader in enterprise telephony systems with $5.2
billion of revenues for the LTM period ended September 30, 2012.
AVAYA INC: S&P Rates Proposed Term Loan and Secured Notes 'B'
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned Basking Ridge, N.J.-
based Avaya Inc.'s proposed term loan B-5 due 2018 and proposed
secured notes due 2019 its issue-level rating of 'B' (one notch
higher than its 'B-' corporate credit rating on the company) with
a recovery rating of '2', indicating its expectation of
substantial (70%-90%) recovery for lenders in the event of a
payment default. "The B-5 term loan will amend and extend a
portion of the company's B-1 term loan due 2014. The proposed
secured notes will refinance a portion of the B-1 term loan. Both
the notes and the loan have a springing maturity of July 2015,
conditioned on net leverage, the occurrence of an IPO, or
repayment or refinancing of at least $750 million of outstanding
notes due 2015," S&P said.
"In addition, we are affirming our 'B-' corporate credit rating on
Avaya, with the expectation that the company's operating trends
will begin to stabilize during 2013 and that it will make progress
over the coming year in addressing its maturity profile for 2014-
2015. The rating outlook is stable. All existing issue-level
ratings on the company's debt also were affirmed, and the existing
recovery ratings on this debt remain unchanged. We note, however,
that our recovery estimates are currently at the low end of their
respective recovery ranges. In the event of a modest diminution of
our recovery estimates, our issue ratings on the company's secured
debt could be lowered to the same level as or below the corporate
credit rating, and the issue ratings on the senior unsecured debt
could be lowered to two notches lower than the corporate credit
rating," S&P said.
"Avaya reported a 7% year over year revenue decline and negative
free cash flow of $84 million for the 12 months ended September
2012. Although the September quarter marked the third consecutive
quarter of year-over-year top-line declines, we expect that
revenues will begin to stabilize during 2013, supported by recent
restructuring initiatives, as well as the company's recent
resolution of certain product quality issues," S&P said.
"We assess Avaya's business risk profile as 'weak,' based on the
company's challenge to reestablish consistent growth in its core
markets of enterprise communications. We note that revenue trends
have been volatile over the past several years due to competing
technologies, sluggish economies, deferred technology purchases by
the U.S. government, and company-specific product quality miscues,
which collectively contribute to its lackluster revenue
performance. The company's solid position in the customer premises
communications industry, as well as a good base of recurring
services and maintenance revenues, however, somewhat offset these
weaknesses," S&P said.
"We expect EBITDA for the next 12 months to be flat to slightly up
from $810 million for the 12 months ended Sept. 30, 2012, which
treats certain restructuring charges as operational expenses. Free
cash flow is likely to remain negative over the next 12 months, as
we expect earnings growth to remain elusive and as residual
restructuring charges related to rightsizing operations continue,
albeit below prior-year levels," S&P said.
"We consider the company's financial risk profile to be 'highly
leveraged' and we view Avaya's management and governance as
'fair.' Leverage for the company is very high, at about 9.3x for
the 12 months ended Sept. 30, 2012, including underfunded pension
adjustments and operating lease adjustments. Avaya had about $1.8
billion underfunded pension obligations at Sept. 30, 2012, up
slightly year over year," S&P said.
RATINGS LIST
Ratings Affirmed
Avaya Inc.
Corporate Credit Rating B-/Stable/--
Senior Secured B
Recovery Rating 2
Senior Unsecured CCC+
Recovery Rating 5
New Ratings
Avaya Inc.
Secured term loan B-5 due 2018 B
Recovery Rating 2
Secured notes due 2019 B
Recovery Rating 2
BAKERS FOOTWEAR: Panel Hiring Polsinelli Shughart as Co-Counsel
---------------------------------------------------------------
The Official Committee of Unsecured Creditors of Bakers Footwear
Group Inc. last month filed papers in Court to retain Polsinelli
Shughart PC as co-counsel in the case.
Sherry Dreisewerd, Esq., attests that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the
Bankruptcy Code.
The firm's rates are:
Professional Rates
------------ -----
James E. Bird (shareholder) $440/hr
Sherry K. Dreisewerd (shareholder) $270/hr
Matthew S. Layfield (associate) $270/hr
Rebecca M. O'Brien (paralegal) $125/hr
About Bakers Footwear
Bakers Footwear Group Inc., a mall-based retailer of shoes for
young women, filed for bankruptcy protection (Bankr. E.D. Mo. Case
No. 12-49658) in St. Louis on Oct. 3, 2012, after announcing a
plan to close stores and reduce costs.
Bakers was founded in St. Louis in 1926 as Weiss-Kraemer, Inc.,
later renamed Weiss and Neuman Shoe Co., a regional chain of
footwear stores. In 1997, Bakers was acquired principally by its
current chief executive officer, Peter Edison, who had previously
served in various senior management positions at Edison Brothers
Stores Inc. In June 1999, Bakers purchased selected assets of the
"Bakers" and "Wild Pair" footwear retailing chains from the
bankruptcy estate of Edison Brothers. The "Bakers" footwear
retailing chain was founded in 1924 and is the third-oldest soft
goods retail concept still in operation in the United States.
In February 2001, the Debtor changed its name to Bakers Footwear
Group, Inc. In February 2004, Bakers conducted an initial public
offering of its common stock. Bakers' common stock is quoted
under the ticker symbol "BKRS" on the, the OTC Markets Group's
quotation platform.
As of the Petition Date, Bakers operates roughly 215 stores
nationwide.
In November 2012, the U.S. Bankruptcy Court in St. Louis
authorized the company to hire a joint venture between SB Capital
Group LLC and Tiger Capital Group LLC as agents to conduct closing
sales for 150 stores.
Bankruptcy Judge Charles E. Rendlen III presides over the case.
Brian C. Walsh, Esq., David M. Unseth, Esq., and Laura Uberti
Hughes, Esq., at Bryan Cave LLP, serve as the Debtor's counsel.
Alliance Management serves as financial and restructuring
advisors. Donlin, Recano & Company, Inc., serves as claims agent.
The petition was signed by Peter A. Edison, chief executive
officer and president.
The Company's balance sheet at April 28, 2012, showed $41.90
million in total assets, $59.49 million in total liabilities and a
$17.59 million total shareholders' deficit.
Counsel for Crystal Financial, the DIP Lender, are Donald E.
Rothman, Esq., at Riemer & Braunstein LLP; and Lisa Epps Dade,
Esq., at Spencer, Fane, Britt & Brown, LLP.
Bradford Sandler, Esq., at Pachulski Stang Ziehl & Jones LLP,
represents the Official Committee of Unsecured Creditors.
BAKERS FOOTWEAR: Panel Hires BDO Consulting as Financial Advisors
-----------------------------------------------------------------
The Official Committee of Unsecured Creditors of Bakers Footwear
Group Inc. has tapped BDO Consulting as financial advisors.
David E. Berliner attests that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the
Bankruptcy Code.
The firm, will among other things, provide these services:
a. analyze the financial operations of the Debtor prepetition
and postpetition, as necessary;
b. conduct any requested financial analysis including
verifying the material assets and liabilities of the
Debtor, as necessary, and their values; and
c. assist the committee in its review of monthly statements
of operations submitted by the Debtor.
About Bakers Footwear
Bakers Footwear Group Inc., a mall-based retailer of shoes for
young women, filed for bankruptcy protection (Bankr. E.D. Mo. Case
No. 12-49658) in St. Louis on Oct. 3, 2012, after announcing a
plan to close stores and reduce costs.
Bakers was founded in St. Louis in 1926 as Weiss-Kraemer, Inc.,
later renamed Weiss and Neuman Shoe Co., a regional chain of
footwear stores. In 1997, Bakers was acquired principally by its
current chief executive officer, Peter Edison, who had previously
served in various senior management positions at Edison Brothers
Stores Inc. In June 1999, Bakers purchased selected assets of the
"Bakers" and "Wild Pair" footwear retailing chains from the
bankruptcy estate of Edison Brothers. The "Bakers" footwear
retailing chain was founded in 1924 and is the third-oldest soft
goods retail concept still in operation in the United States.
In February 2001, the Debtor changed its name to Bakers Footwear
Group, Inc. In February 2004, Bakers conducted an initial public
offering of its common stock. Bakers' common stock is quoted
under the ticker symbol "BKRS" on the, the OTC Markets Group's
quotation platform.
As of the Petition Date, Bakers operates roughly 215 stores
nationwide.
In November 2012, the U.S. Bankruptcy Court in St. Louis
authorized the company to hire a joint venture between SB Capital
Group LLC and Tiger Capital Group LLC as agents to conduct closing
sales for 150 stores.
Bankruptcy Judge Charles E. Rendlen III presides over the case.
Brian C. Walsh, Esq., David M. Unseth, Esq., and Laura Uberti
Hughes, Esq., at Bryan Cave LLP, serve as the Debtor's counsel.
Alliance Management serves as financial and restructuring
advisors. Donlin, Recano & Company, Inc., serves as claims agent.
The petition was signed by Peter A. Edison, chief executive
officer and president.
The Company's balance sheet at April 28, 2012, showed $41.90
million in total assets, $59.49 million in total liabilities and a
$17.59 million total shareholders' deficit.
Counsel for Crystal Financial, the DIP Lender, are Donald E.
Rothman, Esq., at Riemer & Braunstein LLP; and Lisa Epps Dade,
Esq., at Spencer, Fane, Britt & Brown, LLP.
Bradford Sandler, Esq., at Pachulski Stang Ziehl & Jones LLP,
represents the Official Committee of Unsecured Creditors.
BANKATLANTIC BANCORP: D. Friedman Named Chief Accounting Officer
----------------------------------------------------------------
David Friedman was appointed Chief Accounting Officer of BBX
Capital Corporation, formerly known as BankAtlantic Bancorp,
Inc. Mr. Friedman, age 53, was an employee of BankAtlantic, the
Company's former federal savings bank subsidiary, for the past 24
years, including most recently as Corporate Controller. John K.
Grelle, executive vice president and chief financial officer of
the Company, served as principal accounting officer of the Company
prior to Mr. Friedman's appointment.
About BankAtlantic Bancorp
BankAtlantic Bancorp (NYSE: BBX) --
http://www.BankAtlanticBancorp.com/-- is a bank holding company
and the parent company of BankAtlantic. BankAtlantic --
"Florida's Most Convenient Bank" with a Web presence at
http://www.BankAtlantic.com/-- has nearly $6.0 billion in assets
and more than 100 stores, and is one of the largest financial
institutions headquartered junior in Florida. BankAtlantic has
been serving communities throughout Florida since 1952 and
currently operates more than 250 conveniently located ATMs.
BankAtlantic reported a net loss of $28.74 million in 2011, a net
loss of $143.25 million in 2010, and a net loss of $185.82 million
in 2009.
The Company's balance sheet at Sept. 30, 2012, showed
$488.35 million in total assets, $233.62 million in total
liabilities and $254.72 million in total stockholders' equity.
* * *
As reported by the TCR on March 1, 2011, Fitch has affirmed its
current Issuer Default Ratings for BankAtlantic Bancorp and its
main subsidiary, BankAtlantic FSB at 'CC'/'C' following the
announcement regarding the regulatory order with the Office of
Thrift Supervision.
BankAtlantic has announced that it has entered into a Cease and
Desist Order with the OTS at both the bank and holding company
level. The regulatory order includes increased regulatory capital
requirements, limits to the size of the balance sheet, no new
commercial real estate lending and improvements to its credit risk
and administration areas. Further, the holding company must also
submit a capital plan to maintain and enhance its capital
position.
BENADA ALUMINUM: Committee Can Hire Miles & Stockbridge as Counsel
------------------------------------------------------------------
The Official Committee of Unsecured Creditors of Benada Aluminum
Products LLC sought and obtained permission from the U.S.
Bankruptcy Court to retain Miles & Stockbridge P.C. as lead
counsel.
In October, Donald F. Walton, the U.S. Trustee for Region 21,
appointed three members to the Unsecured Creditors' Committee.
The members are:
1. American Douglas Metals, INC.
c/o Steve Powers, President
783 Thorpe Road
Orlando, FL 32824
Tel: 407-855-6590
Fax: 407-857-3290
Email: spowers@americandouglasmetals.com
2. Hydro Aluminum North America, Inc.
c/o Matthew F. Aboud, Vice President
999 Corporate Blvd., Suite 100
Linthicum, MD 21090
Tel: 443-995-6167
Fax: 410-487-8181
Email: matt.aboud@hydro.com
3. Hunter Douglas Metals, Inc.
c/o Richard Sfura
915 W. 175th Street
Homewood, IL 60430
Tel: 708-799-0800
Fax: (not provided)
Email: rich.sfura@hdmet.com
According to court papers filed by the Committee, the firm, will
among other things, provide these services:
(a) participating in and advising the Committee on case-
related issues;
(b) updating the Committee on the status of the bankruptcy
case; and
(c) providing legal advice regarding the Debtor's use of cash
collateral and other financial issues.
The Committee proposed to pay the firm on an hourly basis, at a 5%
discount off the M&S regular hourly rate, plus reimbursement of
actual and necessary expenses incurred in accordance with M&S's
ordinary and customary rates in effect on the day services are
rendered.
The M&S attorneys who will be primarily responsible for this
matter are Joel L. Perrell Jr. (Principal) and Kenneth M. Misken
(Principal), and their hourly rate in this case is $403.75.
Mr. Perrell attests that the firm is a "disinterested person" as
the term is defined in Section 101(14) of the Bankruptcy Code.
The firm may be reached at:
Joel L. Perrell Jr., Esq.
MILES & STOCKBRIDGE P.C.
10 Light Street
Baltimore, MD 21202-1487
Direct Number: 410-385-3762
Main Number: 410-727-6464
Fax Number: 410-385-3700
E-mail: jperrell@milesstockbridge.com
About Benada
Benada Aluminum Products LLC was formed in 2011 to purchase assets
of two aluminum products manufacturing companies. It purchased
via 11 U.S.C. Sec. 363 the Sanford facility of Florida Extruders
International (Case No. 08-07761). It also purchased the assets
Miami, Florida-based Benada Aluminum of Florida Inc. The Debtor
has since consolidated operations and operates only out of its
location in Sanford.
The Company filed for Chapter 11 protection on Aug. 1, 2012
(Bankr. M.D. Fla. Case No. 12-10518). Judge Karen S. Jennemann
presides over the case. R. Scott Shuker, Esq., at Latham Shuker
Eden & Beaudine LLP, represents the Debtor. The Debtor disclosed
$22,009,272 in assets and $11,698,426 in liabilities as of the
Chapter 11 filing.
Wells Fargo is represented by Michael Demont, Esq., and Jay Smith,
Esq., at Smith Hulsey & Busey, in Jacksonville, Florida. FTL
Capital is represented by Christopher J. Lawhorn, Esq., at Bryan
Cave LLP in St. Louis, Missouri. Triton Capital Partners Ltd.
serves as exclusive financial advisor and investment banker with
respect to providing assistance with turnaround management.
The Debtor was authorized by the bankruptcy judge at a Sept. 25,
hearing to sell an aluminum extrusion press for $2.9 million to
Tubelite Inc.
BENADA ALUMINUM: Court Approves Bush Ross as Committee Counsel
--------------------------------------------------------------
The Official Committee of Unsecured Creditors of Benada Aluminum
Products LLC sought and obtained permission from the U.S.
Bankruptcy Court to retain Bush Ross, P.A. and Adam Lawton Alpert,
Esq. -- aalpert@bushross.com -- a shareholder of Bush Ross, as
counsel.
The firm, will among other things, provide these services:
a. give the Committee legal advice with respect to its
powers and duties;
b. consult with the Committee and the Debtor regarding the
administration of the bankruptcy case; and
c. investigate the acts, conduct, assets, liabilities, and
financial condition of the Debtor, the operation of the
Debtor's business, and any other matter relevant to the case
or to the formulation of a plan.
The committee attests that the firm is a "disinterested person" as
the term is defined in Section 101(14) of the Bankruptcy Code.
About Benada
Benada Aluminum Products LLC was formed in 2011 to purchase assets
of two aluminum products manufacturing companies. It purchased
via 11 U.S.C. Sec. 363 the Sanford facility of Florida Extruders
International (Case No. 08-07761). It also purchased the assets
Miami, Florida-based Benada Aluminum of Florida Inc. The Debtor
has since consolidated operations and operates only out of its
location in Sanford.
The Company filed for Chapter 11 protection on Aug. 1, 2012
(Bankr. M.D. Fla. Case No. 12-10518). Judge Karen S. Jennemann
presides over the case. R. Scott Shuker, Esq., at Latham Shuker
Eden & Beaudine LLP, represents the Debtor. The Debtor disclosed
$22,009,272 in assets and $11,698,426 in liabilities as of the
Chapter 11 filing.
Wells Fargo is represented by Michael Demont, Esq., and Jay Smith,
Esq., at Smith Hulsey & Busey, in Jacksonville, Florida. FTL
Capital is represented by Christopher J. Lawhorn, Esq., at Bryan
Cave LLP in St. Louis, Missouri. Triton Capital Partners Ltd.
serves as exclusive financial advisor and investment banker with
respect to providing assistance with turnaround management.
The Debtor was authorized by the bankruptcy judge at a Sept. 25,
hearing to sell an aluminum extrusion press for $2.9 million to
Tubelite Inc.
BERNARD L. MADOFF: Peter A "Victim" of Brother's Crime
------------------------------------------------------
The Wall Street Journal's Reed Albergotti reports that Peter
Madoff, who is due to be sentenced Thursday, was convinced that
his older brother, Bernard L. Madoff, was a "trading genius," and
has already been punished far more than his crimes warrant, his
attorney, John R. Wing, said in a lengthy memorandum to a judge.
According to the report, Peter Madoff's lawyer acknowledged that
his client benefited from Bernard's multibillion dollar fraud but
also argued that Peter was a "victim of his brother's Ponzi
scheme." Mr. Wing, Esq., at Lankler Siffert & Wohl, wrote in his
memo that Peter was a "clear beneficiary of his older brother's
largess," but was duped into breaking the law by Bernard.
The report relates the 190-page court filing included reams of
letters from friends and supporters. The court filing was sent to
U.S. District Judge Laura Taylor Swain earlier this month and made
public Monday.
According to the report, the memo also asked the judge for Peter's
prison sentence to begin after his granddaughter's bat mitzvah on
Jan. 19, 2013. As part of his plea earlier this year, Peter
Madoff agreed not to ask for a prison sentence shorter than 10
years, the term recommended by prosecutors.
The report recounts Peter, 67, pleaded guilty to fraud in June and
entered a plea agreement that would send him to prison for up to a
decade. He admitted that he lied to regulators and committed
other crimes that allowed Bernard Madoff to perpetuate one of
history's biggest investment frauds. The report notes prosecutors
haven't charged any Madoff family member besides Bernard and Peter
with any wrongdoing. Bernard Madoff is serving a 150-year prison
term.
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: Victim Blasts $220-Mil. Levy Settlement
----------------------------------------------------------
Richard Vanderford at Bankruptcy Law360 reports that a Bernard
Madoff victim on Monday urged the Second Circuit to undo trustee
Irving Picard's $220 million settlement with heirs of net-winner
Norman F. Levy, saying Picard settled too cheaply.
When Madoff's Ponzi scheme collapsed, Levy owed $2 billion to his
firm, a point Picard should have taken into account when crafting
a settlement that ended his heirs' liability, a lawyer for victim
Marsha Peshkin said at oral arguments before a three-judge panel
in Manhattan, according to Bankruptcy Law360.
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: Investors to Get $85MM More From Merkin Funds
----------------------------------------------------------------
Eric Hornbeck at Bankruptcy Law360 reports that Judge Richard B.
Lowe III on Tuesday approved an $85 million payment to investors
in Gabriel Capital LP and Ariel Fund Ltd., two alleged Madoff
feeder funds formerly run by hedge fund manager J. Ezra Merkin,
bringing the total amount returned to investors to more than $588
million.
Bankruptcy Law360 relates that Judge Lowe approved the
distribution, which was unopposed, after receiver Bart M. Schwartz
made a motion in October for a fourth distribution of $40 million
to Ariel investors and $45 million to Gabriel investors.
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.
BERKELEY COFFEE: Incurs $110,000 Net Loss in Oct. 31 Quarter
------------------------------------------------------------
Berkeley Coffee & Tea, Inc., filed its quarterly report on Form
10-Q, reporting a net loss of $109,779 on $63,621 of sales for the
three months ended Oct. 31, 2012, compared with a net loss of
$11,753 on $53,629 of sales for the prior fiscal period.
For the six months ended Oct. 31, 2012, the Company had a net loss
of $183,522 on $119,793 of sales, compared with a net loss of $774
on $102,659 of sales for the six months ended Oct. 31, 2011.
Expenses were $199,718 and $42,321 for the six months ended
Oct. 31, 2012, and 2011.
The increase in expenses for the six months ended Oct. 31, 2012,
resulted from higher office and administration costs and an
amortization of discount on bonds of $9,030.
The Company's balance sheet at Oct. 31, 2012, showed
$4.62 million in total assets, $4.69 million in total liabilities,
and stockholders' equity of $19,961.
As reported in the TCR on Aug. 14, 2012, MaloneBailey, LLP, in
Houston, Texas, expressed substantial doubt about Berkeley Coffee
& Tea Inc.'s ability to continue as a going concern, following the
Company's results for the fiscal year ended April 30, 2012. The
independent auditors noted that the Company has suffered recurring
losses from operations.
A copy of the Form 10-Q is available at http://is.gd/J3twx8
Shanghai, China-based Berkeley Coffee & Tea, Inc., was
incorporated in the State of Nevada on March 27, 2009. Berkeley
Coffee derives its revenue from the sale of roasted coffee.
BROADCAST INTERNATIONAL: Extends Current Contract for 2 Months
--------------------------------------------------------------
Broadcast International, Inc., was informed by its largest
customer that its contract with the Company to provide digital
signage services to the customer that had previously been extended
to Feb. 1, 2013, would be further extended through April 30, 2013.
The Company will continue to provide managed media services to the
customer for a 3-year period.
About Broadcast International
Based in Salt Lake City, Broadcast International, Inc., installs,
manages and supports private communication networks for large
organizations that have widely-dispersed locations or operations.
The Company owns CodecSys, a video compression technology to
convert video content into a digital data stream for transmission
over satellite, cable, Internet, or wireless networks, as well as
offers audio and video production services. The Company's
enterprise clients use its networks to deliver training programs,
product announcements, entertainment, and other communications to
their employees and customers.
The Company reported net income of $1.30 million in 2011, compared
with a net loss of $18.66 million in 2010.
The Company's balance sheet at Sept. 30, 2012, showed
$3.15 million in total assets, $9.45 million in total liabilities,
and a $6.30 million total stockholders' deficit.
BROADWAY FINANCIAL: Wellington No Longer Owns Common Shares
-----------------------------------------------------------
In an amended Schedule 13G filing with the U.S. Securities and
Exchange Commission, Wellington Management Company, LLP, disclosed
that, as of Nov. 30, 2012, it does not beneficially own any shares
of common stock of Broadway Financial Corporation. A copy of the
filing is available for free at http://is.gd/fm00zA
About Broadway Financial
Los Angeles, Calif.-based Broadway Financial Corporation was
incorporated under Delaware law in 1995 for the purpose of
acquiring and holding all of the outstanding capital stock of
Broadway Federal Savings and Loan Association as part of the
Bank's conversion from a federally chartered mutual savings
association to a federally chartered stock savings bank. In
connection with the conversion, the Bank's name was changed to
Broadway Federal Bank, f.s.b. The conversion was completed, and
the Bank became a wholly owned subsidiary of the Company, in
January 1996.
The Company is currently regulated by the Board of Governors of
the Federal Reserve System. The Bank is currently regulated by
the Office of the Comptroller of the Currency and the Federal
Deposit Insurance Corporation.
The Company has a tax sharing liability to the Bank which exceeds
operating cash at the Company level. The Company used its cash
available at the holding company level to pay a substantial
portion of this liability pursuant to the terms of the Tax
Allocation Agreement between the Bank and the Company on March 30,
2012, and does not have cash available to pay its operating
expenses. Additionally, the Company is in default under the terms
of a $5 million line of credit with another financial institution
lender.
Crowe Horwath LLP, in Costa Mesa, California, expressed
substantial doubt about the Company's ability to continue as a
going concern following the annual results for the year ended
Dec. 31, 2011.
Bankruptcy Warning
"There can be no assurance our recapitalization plan will be
achieved on the currently contemplated terms, or at all. If we
are unable to raise capital, we plan to continue to shrink assets
and implement other strategies to increase earnings. Failure to
maintain capital sufficient to meet the higher capital
requirements could result in further regulatory action, which
could include the appointment of a conservator or receiver for the
Bank. The Company or its creditors could also initiate bankruptcy
proceedings," accoring to the Company's quarterly report for the
quarter ended Sept. 30, 2012.
CAESARS ENTERTAINMENT: Completes $750MM Senior Notes Offering
-------------------------------------------------------------
Caesars Operating Escrow LLC and Caesars Escrow Corporation,
wholly owned subsidiaries of Caesars Entertainment Operating
Company, Inc., a wholly owned subsidiary of Caesars Entertainment
Corporation, completed the offering of $750,000,000 aggregate
principal amount of 9% Senior Secured Notes due 2020.
The Additional Notes were issued under the same indenture
governing the 9% Senior Secured Notes due 2020 that were issued on
Aug. 22, 2012, but the Additional Notes and the Existing Notes
will not be fungible until the completion of a registered exchange
offer pursuant to which holders that exchange their Additional
Notes or Existing Notes will collectively receive registered 9%
Senior Secured Notes due 2020 that will have a single CUSIP number
and thereafter be fungible.
A copy of the Supplemental Indenture is available at:
http://is.gd/hDP09c
A detailed copy of the Form 8-K is available at:
http://is.gd/hDP09c
About Caesars Entertainment
Caesars Entertainment Corp., formerly Harrah's Entertainment Inc.
-- http://www.caesars.com/-- is one of the world's largest casino
companies, with annual revenue of $4.2 billion, 20 properties on
three continents, more than 25,000 hotel rooms, two million square
feet of casino space and 50,000 employees. Caesars casino resorts
operate under the Caesars, Bally's, Flamingo, Grand Casinos,
Hilton and Paris brand names. The Company has its corporate
headquarters in Las Vegas.
Harrah's announced its re-branding to Caesar's on mid-November
2010.
The Company reported a net loss of $666.70 million in 2011, and a
net loss of $823.30 million in 2010.
The Company's balance sheet at Sept. 30, 2012, showed $28.34
billion in total assets, $28.22 billion in total liabilities and
$114.7 million in total Caesars stockholders' equity.
* * *
As reported by the TCR on March 28, 2012, Moody's Investors
Service upgraded Caesars Entertainment Corp's Corporate Family
Rating (CFR) and Probability of Default Rating both to Caa1 from
Caa2. The upgrade of Caesars' ratings reflects very good
liquidity, an improving operating outlook for gaming in a number
of the company's largest markets that is expected to drive
earnings growth, the completion of a bank amendment that resulted
in the extension of debt maturities to 2018 from 2015, and the
public listing of the company's equity that increases financial
flexibility by providing it with another potential source of
capital. The upgrade of the SGL rating reflects minimal debt
maturities over the next few years, significant cash balances
(approximately $900 million at December 31, 2011) and revolver
availability that will be more than sufficient to fund the
company's cash interest and capital spending needs.
In the Aug. 17, 2012, edition of the TCR, Standard & Poor's
Ratings Services revised its rating outlook on Las Vegas-based
Caesars Entertainment Corp. and wholly owned subsidiary Caesars
Entertainment Operating Co. Inc. to negative from stable. "We
affirmed all other ratings on the companies, including our 'B-'
corporate credit rating," S&P said.
As reported by the TCR on Aug. 17, 2012, Fitch Ratings affirmed
CEC's long-term issuer default rating at 'CCC'.
CAESARS ENTERTAINMENT: Board OKs Stock Option Award to EVP & CFO
----------------------------------------------------------------
The 162(m) Plan Committee of the Board of Directors of Caesars
Entertainment Corporation approved the award of an option to
purchase shares of common stock of the Company to Donald Colvin,
executive vice president and chief financial officer. The award
of the option to purchase shares consists of 93,750 time-based
shares of common stock at an exercise price of $7.32 per share and
56,250 shares of performance-based common stock at an exercise
price of $7.32 per share pursuant to the Company's 2012
Performance Incentive Plan.
The Time-Based Option Grant has a four-year vesting schedule with
25% percent vesting on each anniversary of the grant date as
defined in the Plan.
The Performance-Based Option Grant will have the same vesting
criteria as others held by management and as follows:
50% of the shares will vest on such date that that the
Company's 30-day trailing average closing common stock price
equals or exceeds $35.00 per share
100% of the shares will vest on such date that that the
Company's 30-day trailing average closing common stock price
equals or exceeds $57.41 per share
Additionally, on Dec. 7, 2012, the Human Resources Committee of
the Board of Directors of the Company approved the award of 50,000
restricted shares of common stock to Mr. Colvin. The Restricted
Shares will have a two year vesting schedule (50% annually on the
first and second anniversary of the grant date, respectively).
Also on Dec. 7, 2012, the 162(m) Committee approved an amendment
to the Company's 2009 Senior Executive Incentive Plan.
Eligibility to participate in the SEIP Plan is limited to senior
executives of the Company who are or who at some future date may
be subject to Section 16 of the Securities Exchange Act of 1934,
as amended, and those other senior executives of the Company
designated as eligible for participation by the Committee. The
162m Committee approved the addition of a clawback and forfeiture
provision, which sets guidelines for the clawback of bonuses in
certain circumstances and allows for a clawback of all or some
bonuses paid.
About Caesars Entertainment
Caesars Entertainment Corp., formerly Harrah's Entertainment Inc.
-- http://www.caesars.com/-- is one of the world's largest casino
companies, with annual revenue of $4.2 billion, 20 properties on
three continents, more than 25,000 hotel rooms, two million square
feet of casino space and 50,000 employees. Caesars casino resorts
operate under the Caesars, Bally's, Flamingo, Grand Casinos,
Hilton and Paris brand names. The Company has its corporate
headquarters in Las Vegas.
Harrah's announced its re-branding to Caesar's on mid-November
2010.
The Company reported a net loss of $666.70 million in 2011, and a
net loss of $823.30 million in 2010.
The Company's balance sheet at Sept. 30, 2012, showed $28.34
billion in total assets, $28.22 billion in total liabilities and
$114.7 million in total Caesars stockholders' equity.
* * *
As reported by the TCR on March 28, 2012, Moody's Investors
Service upgraded Caesars Entertainment Corp's Corporate Family
Rating (CFR) and Probability of Default Rating both to Caa1 from
Caa2. The upgrade of Caesars' ratings reflects very good
liquidity, an improving operating outlook for gaming in a number
of the company's largest markets that is expected to drive
earnings growth, the completion of a bank amendment that resulted
in the extension of debt maturities to 2018 from 2015, and the
public listing of the company's equity that increases financial
flexibility by providing it with another potential source of
capital. The upgrade of the SGL rating reflects minimal debt
maturities over the next few years, significant cash balances
(approximately $900 million at December 31, 2011) and revolver
availability that will be more than sufficient to fund the
company's cash interest and capital spending needs.
In the Aug. 17, 2012, edition of the TCR, Standard & Poor's
Ratings Services revised its rating outlook on Las Vegas-based
Caesars Entertainment Corp. and wholly owned subsidiary Caesars
Entertainment Operating Co. Inc. to negative from stable. "We
affirmed all other ratings on the companies, including our 'B-'
corporate credit rating," S&P said.
As reported by the TCR on Aug. 17, 2012, Fitch Ratings affirmed
CEC's long-term issuer default rating at 'CCC'.
CAPABILITY RANCH: Court Approves Gordon Silver as Counsel
---------------------------------------------------------
Capability Ranch, LLC sought and obtained permission from the U.S.
Bankruptcy Court to employ the law firm of Gordon Silver as
bankruptcy counsel.
The Debtor, in its motion, stated that it is necessary to employ
attorneys under a general retainer to render professional
services. GS will use reasonable efforts to coordinate with the
Debtor and Debtor's other retained professionals to avoid
unnecessary duplication of services.
Prior to the Petition Date, the Debtor paid GS $7,752 for legal
services rendered in connection with its restructuring. GS is
also currently holding in retainer the sum of $44,747.
The compensation for the services provided by GS attorneys and
paraprofessionals is proposed at varying hourly rates ranging from
$135 to $190 for paraprofessionals, from $190 to $360 for
associates, and from $400 to $725 for shareholders of GS.
To the best of the Debtor's knowledge, GS is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.
Las Vegas-based Capability Ranch, LLC, fdba Monroe Property
Company, LLC, filed for Chapter 11 bankruptcy (Bankr. D. Nev. Case
No. 12-21121) on Sept. 21, 2012. Bankruptcy Judge Bruce A.
Markell presides over the case. Thomas H. Fell, Esq., at Gordon
Silver, serves as the Debtor's counsel.
Capability Ranch estimated assets and debts of $50 million to
$100 million. The Debtor said it owns property on 40060 Paws Up
Road in Greenough, Montana. The property is a 37,000-acre luxury
Montana ranch and Montana resort. According to
http://www.pawsup.com/, The Resort at Paws Up has 28 luxury
vacation homes and 24 luxury camping tents. The resort offers
horseback riding, fly fishing, and spa treatments.
CAPITAL GROUP: Incurs $596,000 Net Loss in Sept. 30 Quarter
-----------------------------------------------------------
Capital Group Holdings, Inc., filed its quarterly report on Form
10-Q, reporting a net loss of $596,344 on $508,425 of revenues for
the three months ended Sept. 30, 2012, compared with a net loss of
$170,776 on $nil revenue for the three months ended Sept. 30,
2011.
The Company's balance sheet at Sept. 30, 2012, showed
$13.6 million in total assets, $2.6 million in total liabilities,
and stockholders' equity of $11.0 million.
According to the regulatory filing, the Company ceased being a
development stage company on Sept. 3, 2012, when the Company
acquired the operations of Alliance Urgent Care.
"The revenues reported for the quarter ended Sept. 30, 2012,
represent the revenues of the urgent care centers from the date of
acquisition. Since we do not have a long history in generating
revenue, we have negative cash flows from operations, and negative
working capital, the Company's independent registered public
accounting firm has included a reference to the substantial doubt
about our ability to continue as a going concern in connection
with our consolidated financial statements for the year ended
June 30, 2012.
A copy of the Form 10-Q is available at http://is.gd/QnJBvf
Scottsdale, Ariz.-based Capital Group Holdings, Inc. (OTC QB:
CGHC) through its subsidiaries, currently operates 7 urgent care
clinics in metropolitan Phoenix, Arizona and will soon launch its
telemedicine services through its subsidiary One Health Pass Inc.
CATASYS INC: David Smith Discloses 40.8% Equity Stake
-----------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, David E. Smith disclosed that, as of Dec. 4,
2012, he beneficially owns 61,032,567 shares of common stock of
Catasys, Inc., representing 40.8% of the shares outstanding.
Mr. Smith previously reported beneficial ownership of 46,746,851
common shares or a 48.9% equity stake as of Sept. 13, 2012.
On Dec. 4, Mr. Smith purchased 7,142,858 common shares from
Catasys in a private placement at $0.07 per share. The source of
funds used by Mr. Smith for that purchase was his personal funds.
A copy of the amended filing is available for free at:
http://is.gd/kfKZpE
About Hythiam, Inc.
Based in Los Angeles, California, Hythiam, Inc., n/k/a Catasys,
Inc., is a healthcare services management company, providing
through its Catasys(R) subsidiary specialized behavioral health
management services for substance abuse to health plans.
In its auditors' report accompanying the consolidated financial
statements for the year ended Dec. 31, 2011, Rose, Snyder & Jacobs
LLP, in Encino, California, expressed substantial doubt about the
Company's ability to continue as a going concern. The independent
auditors noted that the Company has incurred significant operating
losses and negative cash flows from operations during the year
ended Dec. 31, 2011.
The Company reported a net loss of $8.12 million in 2011, compared
with a net loss of $19.99 million in 2010.
The Company's balance sheet at Sept. 30, 2012, showed $3.67
million in total assets, $11.88 million in total liabilities and a
$8.21 million total stockholders' deficit.
Bankruptcy Warning
As of Nov. 14, 2012, the Company had a balance of approximately
$657,000 cash on hand. The Company had working capital deficit of
approximately $2.2 million at Sept. 30, 2012. The Company has
incurred significant net losses and negative operating cash flows
since its inception. The Company could continue to incur negative
cash flows and net losses for the next twelve months. The
Company's current cash burn rate is approximately $450,000 per
month, excluding non-current accrued liability payments. The
Company expects its current cash resources to cover expenses into
December 2012, however delays in cash collections, fees, or
unforeseen expenditures, could impact this estimate. The Company
will need to immediately obtain additional capital and there is no
assurance that additional capital can be raised in an amount which
is sufficient for the Company or on terms favorable to its
stockholders, if at all.
"If we do not immediately obtain additional capital, there is a
significant doubt as to whether we can continue to operate as a
going concern and we will need to curtail or cease operations or
seek bankruptcy relief. If we discontinue operations, we may not
have sufficient funds to pay any amounts to stockholders."
CENVEO CORP: Moody's Rates New Add-on Term Loan 'Ba3'
-----------------------------------------------------
Moody's Investors Service rated Cenveo Corporation's new add-on
term loan Ba3. As part of the same rating action, Cenveo's
corporate family rating (CFR) and probability of default rating
(PDR) were affirmed at B3, and its speculative grade liquidity
rating (SGL) upgraded to SGL-3 (adequate liquidity) from SGL-4
(weak liquidity). The outlook remains negative.
Cenveo Corporation is a wholly-owned subsidiary of Cenveo, Inc.
(Cenveo), a publicly traded holding company. While all debt
instruments are issued by Cenveo Corporation, since Cenveo Inc.
guarantees all of Cenveo Corporation's debt and financial
statements are issued only by Cenveo Inc., Moody's maintains
corporate-level ratings and the associated outlook at Cenveo Inc.
Proceeds from the new $15 million add-on term loan plus those from
a new unrated $50 million senior unsecured note will be used to
call for the remaining balance of Cenveo Corporation's senior
subordinated notes due December 1, 2013. Since the transaction is
debt-neutral Cenveo's CFR and PDR were affirmed at B3. Since the
transaction eliminates near term refinance risks that had weighed
on the company's liquidity rating, it was upgraded to SGL-3
(adequate) from SGL-4 (weak).
With a thin equity cushion, recent sequential year-over-year
revenue declines and free cash flow that may be inflated through
capital rationing, it is not clear that company's debt load is
sustainable. Accordingly, Cenveo remains weakly positioned at the
B3 rating level and the rating outlook is negative.
The following summarizes Cenveo's ratings and the rating actions:
Issuer: Cenveo Corporation
Senior Secured Bank Credit Facility, assigned Ba3 (LGD2, 19%)
Issuer: Cenveo Inc.
Speculative Grade Liquidity Rating, upgraded to SGL-3 from
SGL-4
Outlook, unchanged at Negative
Corporate Family Rating, affirmed at B3
Probability of Default Rating, affirmed at B3
Issuer: Cenveo Corporation
Senior Secured Bank Credit Facility, affirmed at Ba3 with the
LGD Assessment revised to (LGD2, 19%) from (LGD2, 17%)
Senior Secured Second Lien Notes, affirmed at B3 with the LGD
Assessment revised to (LGD4, 58%) from (LGD4, 52%)
Senior Unsecured Regular Bond/Debenture, affirmed at Caa2
with the LGD Assessment revised to (LGD5, 87%) from (LGD5,
85%)
Senior Subordinated Regular Bond/Debenture, affirmed at Caa2
(LGD6, 97%) [will be withdrawn in due course]
Ratings Rationale
Cenveo's B3 rating is based primarily on the company's elevated
leverage (Debt/EBITDA was 6.5x at September 30, 2012) and the
related limited ability to service its significant debt load (LTM
FCF/Debt was 3.2% at September 30, 2012). Cenveo's credit profile
leaves management with limited financial flexibility with which to
refinance debts as they come due. The company's volatile and
uncertain cash flow, the result of a significant exposure to
commercial printing and related activities, all of which are under
intense secular pressure, is also a negative consideration.
Ongoing industry issues have recently caused revenues to decline
at a nearly 5% rate which means, even with EBITDA margins holding
at nearly 13%, that EBITDA and financial flexibility are shrinking
(unless otherwise noted, all measures are inclusive of Moody's
standard adjustments). However, with management limiting capital
spending to 1% of revenues, Cenveo is able to generate $50
million-to-$60 million per year of free cash flow, and recent
refinance activities provide the company with much-needed time to
use FCF to reduce debt.
Rating Outlook
Cenveo remains weakly positioned at the B3 rating level and the
rating outlook is negative as a consequence of down-side risks
stemming from the company's recent revenue declines and modest
free cash flow.
What Could Change the Rating - Up
Since Cenveo is weakly positioned at the B3 level, a near-term
upgrade is unlikely. A positive rating action would require
expectations of TD/EBITDA leverage being less than 4.5x on a
sustained basis along with free cash flow in excess of 5% of total
debt (in both cases, incorporating Moody's standard adjustments).
With current TD/EBITDA measuring 6.5x, reaching the upgrade
trigger implies that debt has to be reduced by some 30% or,
alternatively, EBITDA has to grow by approximately 45% (or, more
likely, a more modest combination of the two). Given this and
given that an upgrade would also be based on solid liquidity
arrangements, an absence of near-term refinance risks, improved
industry fundamentals, and a stable business platform displaying
top-line growth, Cenveo's ratings are likely to be constrained at
the B3 level for some time.
What Could Change the Rating - Down
Cenveo's ratings could be downgraded if liquidity and refinance
issues arise or if debt reduction activities falter whether
because of poor results or a management decision.
The principal methodology used in rating Cenveo was the Global
Publishing Industry Methodology published in December 2011. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
CHILE MINING: Selling Ana Maria Plant Produced Copper to Madeco
---------------------------------------------------------------
In late October 2012, Chile Mining Technologies Inc. commenced
full-scale operations at its Ana Maria plant and began producing
copper cathodes. To date, the Company has harvested 9 metric tons
of copper from the Ana Maria plant. The Company is selling the
produced copper to Madeco S.A., a producer of copper cables and
other byproducts, and one of the largest clearinghouses for copper
in Chile. The Company continues to refine its copper production
process in order to maximize the quality of the copper produced.
In addition to the copper which has been produced, the Company
estimates that it has delivered additional raw mineral containing
roughly 35 metric tons of copper to the Ana Maria plant for future
production. The Company expects to extract the copper from this
raw material over the next several months, and will continue to
deliver additional mineral for processing.
About Chile Mining
Chile Mining Technologies Inc. is a mineral extraction company
based in the Republic of Chile, with copper as its principal "pay
metal." Its founders, Messrs. Jorge Osvaldo Orellana Orellana and
Jorge Fernando Pizarro Arriagada, have refined the electrowin
process in a way that permits the electrowin process to be used at
a relatively small mine and/or tailings sites. Electrowinning is
a process in which positive and negative electrodes are placed in
an acidic solution containing copper ions, and an electric current
passed through the solution causes the copper to be deposited on
the negative electrodes so that it can be collected.
Schwartz Levitsky Feldman LLP, in Toronto, Ontario, Canada,
expressed substantial doubt about Chile Mining's ability to
continue as a going concern following the fiscal year ended
March 31, 2012, annual report. The independent auditors noted
that the continuance of the Company is dependent upon its ability
to obtain financing and upon future profitable operations from the
production of copper.
The Company reported a net loss of US$3.95 million on US$433,554
of sales in fiscal 2012, compared with a net loss of
US$7.25 million on US$188,227 of sales in fiscal 2011.
The Company's balance sheet at Sept. 30, 2012, showed US$8.72
million in total assets, US$11.24 and a US$2.51 million
stockholders' deficiency.
CHAMPION INDUSTRIES: Issues Class B Warrants to Secured Lenders
---------------------------------------------------------------
Champion Indusries, Inc., on Dec. 10, 2012, issued to its secured
lenders Warrants to purchase that number of shares of Champion
Class B Common Stock equal to 30% of the then issued and
outstanding common stock of Champion, on a fully diluted, post-
exercise basis. Based on the 11,299,528 shares of Champion common
stock currently issued and outstanding, exercise in full of the
Warrants would result in Champion's issuance of an additional
4,842,654 shares to the Warrant Holders. In the event a greater
number of issued and outstanding common shares exist at the time
of option exercise, a greater number of options of shares of Class
B common stock would be issuable.
Champion is party to a Credit Agreement dated as of Sept. 14,
2007, as amended, among Champion, as borrower, Fifth Third Bank,
as administrative agent and lender and various other Lenders.
Champion was in default under various provisions of the Credit
Agreement on Oct. 19, 2012.
As one of the conditions to entering into a First Amended and
Restated Credit Agreement dated Oct. 19, 2012, whereby the Lenders
agreed not to accelerate the maturity of Champion's loans based on
the existing defaults and subject to Champion's compliance with
the Amended Credit Agreement, to extend the maturity of the loans
to June 30, 2013, the Secured Lenders required Champion to issue
Warrants to purchase shares of Class B common stock to be
authorized by Champion and to enter into a related Investors'
Right Agreement. The Warrants have a five year term and are
exercisable by holders thereof at a price of 1/10th of one cent
($0.001) per share of the Class B common stock.
The Warrants may be exercised for all shares of Class B common
stock which may then be purchased thereunder, and for any part of
the shares which may be purchased thereunder on not more than two
occasions.
Champion has agreed with the Warrant Holders that it will at all
times prior to the Warrant expiration date reserve a sufficient
number of shares of its Class B common stock to provide for the
exercise of the Warrants.
In the event of any consolidation or merger of Champion with
another entity, or the sale of substantially all Champion's assets
to another entity that as a condition of such transaction, the
Warrant Holders will have the right to receive upon the basis and
terms of the Warrant and in lieu of shares of Class B common stock
purchasable thereunder those shares of stock, securities or assets
as may by virtue of that transaction be issuable or payable with
respect to an equivalent number of shares of Class B common stock
purchasable under the Warrants had such transaction not taken
place. If the securities to be received in that transaction are
not traded on a national securities exchange the Holder of the
Warrants may elect in lieu of those securities to receive cash
equal to the fair market value of such securities.
The Warrants were issued under an exemption from the registration
requirements of the Securities Act of 1933 as a private placement
exempt under Section 4(2) of the Act.
Meeting Results
At a special meeting of shareholders of Champion held Dec. 7,
2012, the shareholders:
(a) approved (a) the issuance to Champion's secured lenders of
Warrants to purchase that number of shares of Champion
Industries, Inc., Class B Common Stock equal to 30% of issued
and outstanding Common Stock on a fully diluted, post-exercise
basis and (b) a related Investors' Rights Agreement among the
Company and the Warrant Holders; and
(b) approved an amendment to Champion's Articles of Incorporation
to increase the number of authorized shares of common stock to
25,000,000 shares and to create a class of non-voting Class B
common stock consisting of 5,000,000 of those shares.
About Champion Industries
Champion Industries, Inc., is a commercial printer, business forms
manufacturer and office products and office furniture supplier in
regional markets in the United States. The Company also publishes
The Herald-Dispatch daily newspaper in Huntington, WV. The
Company's sales force sells printing services, business forms
management services, office products, office furniture and
newspaper advertising. Its subsidiaries include Interform
Corporation, Blue Ridge, Champion Publishing, Inc., The Dallas
Printing, The Bourque Printing, The Capitol, and The Herald-
Dispatch.
The Company reported a net loss of $3.97 million for the year
ended Oct. 31, 2011, compared with net income of $488,134 during
the prior year.
The Company's balance sheet at July 31, 2012, showed
$51.21 million in total assets, $51.98 million in total
liabilities, and a $767,157 total shareholders' deficit.
CHRIST HOSPITAL: Has Until Jan. 18 to File Chapter 11 Plan
----------------------------------------------------------
The Hon. Morris Stern of the U.S. Bankruptcy Court for the
District of New Jersey to extended, at the behest of Christ
Hospital, the exclusive periods to file and solicit acceptances
for the proposed Chapter 11 plan until Jan. 18, 2013, and
March 19, 2013, respectively.
About Christ Hospital
Christ Hospital filed for Chapter 11 bankruptcy (Bankr. D. N.J.
Case No. 12-12906) on Feb. 6, 2012. Christ Hospital, founded in
1872 by an Episcopalian priest, is a 367-bed acute care hospital
located in Jersey City, New Jersey at 176 Palisade Avenue, serving
the community of Hudson County. The Debtor is well-known for its
broad range of services from primary angioplasty for cardiac
patients to intensity modulated radiation therapy for those
battling cancer. Christ Hospital is the only facility in Hudson
County to offer IMRT therapy, which is the most significant
breakthrough in cancer treatment in recent years.
Christ Hospital filed for Chapter 11 after an attempt to sell the
assets fell through. Judge Morris Stern presides over the case.
Lawyers at Porzio, Bromberg & Newman, P.C., serve as the Debtor's
counsel. Alvarez & Marsal North America LLC serves as financial
advisor. Logan & Company Inc. serves as the Debtor's claim and
noticing agent.
The Health Professional and Allied Employees AFT/AFI-CIO is
represented in the case by Mitchell Malzberg, Esq., at Mitnick &
Malzberg P.C.
CIRTRAN CORP: Court Dismisses Play Beverages Chapter 7 Case
-----------------------------------------------------------
Play Beverages, LLC, announced that the U.S. Bankruptcy Court for
the District of Utah has ruled in its favor and vacated its
bankruptcy, freeing it to take legal actions to protect the
product license granted for its Playboy Energy Drink.
On April 26, 2011, three alleged creditors, LIB-MP Beverage, LLC,
George Denney, and Warner K. Depuy, filed an involuntary Chapter 7
petition against PlayBev, seeking its liquidation and related
matters. In re Play Beverages, LLC, United States Bankruptcy Court
for the District of Utah, Case No. 11-26046.
Judge Joel T. Marker rejected a motion by petitioning creditors,
led by the same three creditors who first put Play Beverages into
involuntary Chapter 7 bankruptcy in April 2011. The judge's
ruling takes Play Beverages out of bankruptcy, enabling it to
continue its action in state courts against Playboy Enterprises
and others to protect its license to produce and sell Playboy
Energy Drink.
The Bankruptcy Court's ruling also rejects the motion of the U.S.
Trustee overseeing the bankruptcy case to convert the case to
Chapter 7 or to have it dismissed. If converted, a trustee would
have been appointed to liquidate Play Beverage's business to repay
creditors.
The dismissal followed a two-day evidentiary hearing, with Play
Beverages stipulating to an order of dismissal, saying it did not
need bankruptcy protection.
"The ruling by Judge Marker to take Play Beverages out of
bankruptcy, allowing the resumption of normal business activities,
is the end of a nightmare," said Iehab J. Hawatmeh, CirTran's
president. "Now, after 18 months of seeing every aspect of our
business impacted negatively, we can move forward to hopefully
regain our momentum and resume growing our beverage business."
Introduced in 2008, Playboy Energy Drink is manufactured and
distributed exclusively by CirTran Beverage Corporation, a wholly
owned subsidiary of CirTran Corporation (OTCBB: CIRC) under a
product license from Playboy Enterprises to Play Beverages, and is
currently available in more than 20 countries around the world.
CirTran's operations include: CirTran-Asia, a subsidiary with
principal offices in ShenZhen, China, which manufactures high-
volume electronics, fitness equipment, and household products for
the multi-billion-dollar direct response industry; CirTran Online,
which offers products directly to consumers through major retail
web sites; and CirTran Beverage, which has partnered with Play
Beverages, LLC, to introduce and distribute the Playboy Energy
Drink.
"The Company had a net loss of $2,540,462 and of $4,831,703 for
the nine months ended September 30, 2012 and 2011, respectively.
As of September 30, 2012, the Company had an accumulated deficit
of $50,314,609. In addition, the Company provided cash from
operations in the amount of $184,112 and used cash in operations
in the amount of $780,312 during the nine months ended September
30, 2012 and 2011, respectively. The Company also had a negative
working capital balance of $27,851,214 as of September 30, 2012,
and $25,540,389 as of December 31, 2011. These conditions raise
substantial doubt about the Company's ability to continue as a
going concern," the Company said in its quarterly report for the
period ended Sept. 30, 2012.
Cirtran incurred a net loss of $7.04 million in 2011, compared
with a net loss of $4.95 million in 2010.
COASTAL PLAINS: Bank Lender's Suit Goes to Trial
------------------------------------------------
Bankruptcy Judge Randy D. Doub denied the Motion for Summary
Judgment and the accompanying memorandum of law filed by Farmers
Cooperative Society, Sioux Center, Iowa; and Cooperative Elevator
Association in the lawsuit commenced by First National Bank of
Omaha, the lender to Coastal Plains Pork, LLC. The Court granted,
in part, the bank's request to reduced FCS and CEA's claims.
The bank commenced the adversary proceeding to determine the
priorities between the bank's perfected security interest and FCS
and CEA's agricultural supply dealer liens pursuant to Iowa Code
Sec. 570A.5.
In connection with its hog growing operation, Coastal Plains
obtained a loan from the bank and purchased feed for its hogs from
FCS and CEA. The bank asserts a lien and security interest in the
hogs owned by Coastal Plains, which secures the funds the bank
advanced to Coastal Plains, in the original principle amount of
$15,201,222, to finance the hog growing operation in Iowa.
FCS and CEA are grain suppliers who supplied feed consumed by hogs
owned by Coastal Plains between June 2009 and September 2009. FCS
filed proof of claim 43 in the amount of $1,097,950.33 and CEA
filed proof of claim 39 in the amount of $814,575.17.
Both FCS and CEA claim they are entitled to first priority over
the bank's lien as suppliers of feed to livestock pursuant to Iowa
Code Chapter 570A.
In his ruling on Monday, Judge Doub said genuine issues of
material fact exist.
The case is, FIRST NATIONAL BANK OF OMAHA, Plaintiff, v. FARMERS
CO-OPERATIVE SOCIETY, SIOUX CENTER, IOWA, and COOPERATIVE ELEVATOR
ASSOCIATION, Defendants, Adv. Proc. No. 09-00214-8-RDD (Bankr.
E.D.N.C.). A copy of the Court's Dec. 17, 2012 Order is available
at http://is.gd/yKCNudfrom Leagle.com.
Coastal Plains Pork, LLC, based in Harrells, N.C., operated a
farrow-to-finish farm for the production of swine in several
states, including Iowa, prior to filing a chapter 11 petition
(Bankr. E.D.N.C. Case No. 09-08367) on Sept. 28, 2009. The Debtor
is represented by Terri L. Gardner, Esq., at Nelson Mullins Riley
& Scarborough, LLP, in Raleigh, N.C. At the time of the filing,
the Debtor estimated its assets and debts at $10 million to
$50 million. On May 3, 2010, the Court granted Coastal Plains'
motion to convert the bankruptcy proceeding from a Chapter 11 case
to a Chapter 7 case.
COMMUNITY CENTRAL: Knight Capital Discloses 10.7% Equity Stake
--------------------------------------------------------------
In a Schedule 13G filing with the U.S. Securities and Exchange
Commission, Knight Capital Americas, LLC, disclosed that, as of
Nov. 30, 2012, it beneficially owns 400,413 shares of common stock
Community Central Bank Corporation representing 10.71% based on
outstanding shares reported on the Company's Form 10-Q filed with
the SEC for quarterly period ending Sept. 30, 2010. A copy of the
filing is available for free at http://is.gd/LboIVy
About Community Central
Community Central Bank Corporation is the holding company for
Community Central Bank in Mount Clemens, Michigan. The Bank
opened for business in October 1996 and serves businesses and
consumers across Macomb, Oakland, St. Clair and Wayne counties
with a full range of lending, deposit, trust, wealth management
and Internet banking services. The Bank operates four full
service facilities in Mount Clemens, Rochester Hills, Grosse
Pointe Farms and Grosse Pointe Woods, Michigan. Community Central
Mortgage Company, LLC, a subsidiary of the Bank, operates
locations servicing the Detroit metropolitan area and central and
northwest Indiana. River Place Trust and Community Central Wealth
Management are divisions of Community Central Bank. Community
Central Insurance Agency, LLC, is a wholly owned subsidiary of
Community Central Bank. The Corporation's common shares currently
trade on The NASDAQ Capital Market under the symbol "CCBD".
The Company's balance sheet at Sept. 30, 2010, showed
$513.7 million in total assets, $501.6 million in total
liabilities, and stockholders' equity of $12.1 million.
"As of Sept. 30, 2010, due to the Corporation's significant
net loss from operations in the three and nine months ended
Sept. 30, 2010, deterioration in the credit quality of the
loan portfolio, and the decline in the level of its regulatory
capital to support operations, there is substantial doubt about
the Corporation's ability to continue as a going concern," the
Corporation said in its Form 10-Q for the quarter ended Sept. 30,
2010.
The Bank is currently subject to a "consent order" with the
Federal Deposit Insurance Corporation and the Michigan Office of
Financial and Insurance Regulation and is "significantly
undercapitalized" under the FDIC's prompt corrective action (PCA)
rules and accordingly is operating under significant operating
restrictions. The Consent Order requires Community Central Bank
to take corrective measures in a number of areas to strengthen and
improve the Bank's financial condition and operations. The
Consent Order is effective as of November 1, 2010. By entering
into the Consent Order, the Bank is directed and has agreed to
increase board oversight and conduct an independent study of
management, improve regulatory capital ratios, charge-off certain
classified assets, reduce its level of loan delinquencies and
problem assets, limit lending to certain borrowers, revise lending
and collection policies, adopt and implement new profit, strategic
and liquidity plans, and correct loan underwriting and credit
administration deficiencies. The Consent Order also requires the
Bank to obtain prior regulatory approval before the payment of
cash dividends or the appointment of any senior executive officers
or directors. The Bank also is not allowed to accept brokered
deposits without a waiver from the FDIC and must comply with
certain deposit rate restrictions.
CLEARWIRE CORP: Craig McCaw Owns Less Than 1% of Class A Shares
---------------------------------------------------------------
In a Schedule 13D filing with the U.S. Securities and Exchange
Commission, Eagle River Holdings, LLC, and Craig O. McCaw
disclosed that, as of Dec. 11, 2012, they beneficially own 391,500
shares of Class A common stock of Clearwire Corporation
representing less than 1% of the shares outstanding. A copy of
the filing is available for free at http://is.gd/R2h6Y4
About Clearwire Corporation
Kirkland, Wash.-based Clearwire Corporation (NASDAQ: CLWR)
-- http://www.clearwire.com/-- through its operating
subsidiaries, is a provider of 4G mobile broadband network
services in 68 markets, including New York City, Los Angeles,
Chicago, Dallas, Philadelphia, Houston, Miami, Washington, D.C.,
Atlanta and Boston.
The Company reported a net loss attributable to the Company of
$717.33 million in 2011, a net loss attributable to the Company of
$487.43 million in 2010, and a net loss attributable to the
Company of $325.58 million in 2009.
The Company's balance sheet at Sept. 30, 2012, showed $8.14
billion in total assets, $5.86 billion in total liabilities and
$2.28 billion in total stockholders' equity.
* * *
As reported by the TCR on Nov. 25, 2011, Standard & Poor's Ratings
Services lowered its corporate credit and senior secured first-
lien issue-level ratings on Bellevue, Wash.-based wireless
provider Clearwire Corp. to 'CCC' from 'CCC+'.
The ratings on Clearwire continue to reflect its "highly
leveraged" financial risk profile based on its high debt burden
and "weak" liquidity (both terms as defined in S&P's criteria).
"The ratings also reflect our view that Clearwire has a vulnerable
business position as a developmental-stage company with
significant competition from better capitalized wireless carriers,
including AT&T Mobility and Verizon Wireless, which are deploying
their own 4G wireless services," S&P said in January 2012.
"We believe that the company would likely run out of cash in the
late 2012 to early 2013 time frame absent significant asset sales,
since we view the terms in the December 2011 wholesale agreement
with Sprint Nextel as unfavorable in the near term and will likely
constrain cash inflows in 2012 to 2013. We have not assumed
spectrum sales in our liquidity assessment because of the
uncertainty involved in finding a buyer, as well as timing.
However, if the company could secure sufficient funding for
operations through 2013, we could raise the ratings," S&P also
stated.
CRAVEN PROPERTIES: Files Schedules of Assets and Liabilities
------------------------------------------------------------
Craven Properties, L.P. filed with the Bankruptcy Court for the
Northern District of Georgia its schedules of assets and
liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $20,000,000
B. Personal Property $203,126
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $3,846,146
E. Creditors Holding
Unsecured Priority
Claims $2,821
F. Creditors Holding
Unsecured Non-priority
Claims $23,704
----------- -----------
TOTAL $20,203,126 $3,872,671
Craven Properties, L.P., a single asset real estate, filed a
Chapter 11 petition (Bankr. N.D. Ga. Case No. 12-23082) in its
hometown in Gainesville, Georgia, on Aug. 31, 2012. Judge Robert
Brizendine presides over the case. John J. McManus, Esq., at John
J. McManus & Associates, P.C., serves as counsel. Billy J. Craven
signed the petition.
In its amended schedules, the Debtor disclosed $28,446,281 in
assets and $3,872,671 in liabilities as of the Petition Date.
CROWN CASTLE: Amended Facility No Impact on Moody's 'Ba2' CFR
-------------------------------------------------------------
Moody's Investors Service said Crown Castle International Corp.'s
Ba2 Corporate Family Rating, SGL-2 Speculative Grade Liquidity
Rating and stable outlook are not affected by the company's recent
announcement that it has amended its bank credit facility
agreement to allow a $500 million increase in its revolver.
The principal methodology used in rating Crown Castle
International Corp. was Global Communications Infrastructure
Industry Methodology published in June 2011.
With headquarters in Houston, Texas, Crown Castle International
Corp., through its wholly-owned operating subsidiaries, is the
largest independent operator of wireless tower assets in the US
offering wireless communications coverage in 92 of the top 100 US
markets. The firm derives approximately 88% of its revenue by
leasing site space on its approximately 30,000 and 1,700 wireless
communications sites in the US and Australia, respectively, to
wireless service providers, with the remaining revenue derived
from its services business, which provides network services
relating to sites or wireless infrastructure for customers.
D MEDICAL INDUSTRIES: Had NIS3 Million Net Loss in 3rd Quarter
--------------------------------------------------------------
D. Medical Industries Ltd. reported a net loss of NIS3.0 million
on NIS13,000 of sales for the three months ended Sept. 30, 2012,
compared with a net loss of NIS7.9 million on NIS305,000 of sales
for the same period last year.
For the nine months ended Sept. 30, 2012, the Company had a net
loss of NIS12.6 million on NIS609,000 of sales, compared with a
net loss of NIS32.4 million on NIS1.1 million of sales for the
same period of 2011.
The Company's balance sheet at Sept. 30, 2012, showed
NIS8.7 million in total assets, NIS7.7 million in total
liabilities, and equity of NIS1.0 million.
A copy of the Form 6-K is available at http://is.gd/Ni8nym
Headquartered in Emek Hefer, Israel, D. Medical Industries Ltd.
and its subsidiaries hold intellectual property and knowledge in
the area of diabetes treatments and drug delivery. The group owns
certain proprietary technology, including among other things, IV
set identification and disconnection mechanism, Intellispring(TM)
insulin delivery technology and continuous metering of blood
glucose levels registered as a patent. Shares of the company are
traded on the Tel Aviv Stock Exchange.
* * *
As reported in the TCR on July 18, 2012, Kesselman & Kesselman, in
Haifa, Israel, expressed substantial doubt about D. Medical
Industries Ltd.'s ability to continue as a going concern,
following the Company's results for the fiscal year ended Dec. 31,
2011. The independent auditors noted that the Company has
suffered recurring losses and negative cash flows from
operations.
DEMCO INC: Sec. 341 Creditors' Meeting Set for Feb. 15
------------------------------------------------------
The U.S. Trustee will convene a meeting of creditors pursuant to
11 U.S.C. 341(a) in the Chapter 11 case of Demco, Inc., aka
Decommissioning & Environmental Management Company on Feb. 15,
2013, at 11:00 a.m. The meeting will be held at 10:00 a.m. at
Buffalo UST - Olympic Towers.
About Demco Inc.
Demco, Inc., aka Decommissioning & Environmental Management
Company, is a specialty trade contractor based in West Seneca, New
York, which provides demolition services, nuclear work,
environmental clean-up, disaster response and a variety of other
services throughout the United States and, on a project-by-project
basis, internationally. Some of Demco's better known demolition
projects in the past have included the Rocky Flats Nuclear Power
Plant, Yankee Stadium, the Orange Bowl, Buffalo Memorial
Auditorium, and the Sunflower Army Ammunition Plant.
Demco filed for Chapter 11 protection (Bankr. W.D. N.Y. Case No.
12-12465) on Aug. 6, 2012. Bankruptcy Judge Michael J. Kaplan
presides over the case. Daniel F. Brown, Esq., at Andreozzi,
Bluestein, Fickess, Muhlbauer Weber, Brown, LLP, represent the
Debtor in its restructuring effort. The Debtor estimated assets
and debts at $10 million to $50 million. The petition was signed
by Michael J. Morin, controller.
Tracy Hope Davis, the U.S. Trustee for Region 2, appointed three
creditors to serve on the Official Committee of Unsecured
Creditors.
DETROIT, MI: To Receive $10 Million, Review from State
------------------------------------------------------
American Bankruptcy Institute reports that cash-strapped Detroit
is set to receive $10 million from Michigan after the city council
dropped its opposition to a key measure on Tuesday, Reuters
reported Dec. 13.
DEX ONE: Fails to Comply with NYSE's $1 Average Share Price Rule
----------------------------------------------------------------
Dex One Corporation received notification on Dec. 4, 2012, from
the New York Stock Exchange (NYSE) that its average closing share
price is below the Exchange's minimum continued listing standard
of $1.00 per share over a consecutive 30 trading-day period. Dex
One has notified the NYSE that it will take steps to cure this
deficiency.
As part of its previously announced merger plans, Dex One will
initiate a 1 for 5 reverse stock split as part of the transaction
to address the NYSE's $1.00 share price continued listing
standard.
Under NYSE rules, Dex One has until its next annual meeting of
stockholders to satisfy the average share price requirement.
During this period, the Company's shares will continue to be
listed and traded on the NYSE, subject to compliance with other
NYSE continued listing standards.
About Dex One
Dex One, headquartered in Cary, North Carolina, is a local
business marketing services company that includes print
directories and online voice and mobile search. Revenue was
approximately $1.1 billion for the LTM period ended Sept. 30,
2010.
R.H. Donnelley Corp. and 19 of its affiliates, including Dex
Media East LLC, Dex Media West LLC and Dex Media Inc., filed for
Chapter 11 protection on May 28, 2009 (Bank. D. Del. Case No. 09-
11833 through 09-11852). They emerged from bankruptcy on Jan. 29,
2010. On the Effective Date and in connection with its emergence
from Chapter 11, RHD was renamed Dex One Corporation.
Dex One reported a net loss of $518.96 million in 2011 compared
with a net loss of $923.59 million for the eleven months ended
Dec. 31, 2010.
The Company's balance sheet at Sept. 30, 2012, showed
$2.86 billion in total assets, $2.77 billion in total liabilities,
and $92.03 million in total shareholders' equity.
* * *
As reported in the April 2, 2012, edition of the TCR, Moody's
Investors Service has downgraded the corporate family rating (CFR)
for Dex One Corporation's to Caa3 from B3 based on Moody's view
that a debt restructuring is inevitable. Moody's has also changed
Dex's Probability of Default Rating (PDR) to Ca/LD from B3
following the company's purchase of about $142 million of par
value bank debt for about $70 million in cash. The Caa3 rating
also reflects Moody's view that additional exchanges at a discount
are likely in the future since the company amended its bank
covenants to make it possible to repurchase additional bank debt
on the open market through the end of 2013.
As reported by the TCR on April 4, 2012, Standard & Poor's Ratings
Services raised its corporate credit rating on Cary, N.C.-based
Dex One Corp. and related entities to 'CCC' from 'SD' (selective
default). "The upgrade reflects our assessment of the company's
credit profile after the completion of the subpar repurchase
transaction in light of upcoming maturities, future subpar
repurchases, and our expectation of a continued week operating
outlook," explained Standard & Poor's credit analyst Chris
Valentine.
DEX ONE: Restructuring Capital Discloses 9.1% Equity Stake
----------------------------------------------------------
In an amended Schedule 13G filing with the U.S. Securities and
Exchange Commission, Restructuring Capital Associates, L.P., and
its affiliates disclosed that, as of Dec. 11, 2012, they
beneficially own 4,604,831 shares of common stock of Dex One
Corporation representing 9.1% of the shares outstanding. A copy
of the filing is available for free at http://is.gd/nM6u1f
About Dex One
Dex One, headquartered in Cary, North Carolina, is a local
business marketing services company that includes print
directories and online voice and mobile search. Revenue was
approximately $1.1 billion for the LTM period ended Sept. 30,
2010.
R.H. Donnelley Corp. and 19 of its affiliates, including Dex
Media East LLC, Dex Media West LLC and Dex Media Inc., filed for
Chapter 11 protection on May 28, 2009 (Bank. D. Del. Case No. 09-
11833 through 09-11852). They emerged from bankruptcy on Jan. 29,
2010. On the Effective Date and in connection with its emergence
from Chapter 11, RHD was renamed Dex One Corporation.
Dex One reported a net loss of $518.96 million in 2011 compared
with a net loss of $923.59 million for the eleven months ended
Dec. 31, 2010.
* * *
As reported in the April 2, 2012 edition of the TCR, Moody's
Investors Service has downgraded the corporate family rating (CFR)
for Dex One Corporation's to Caa3 from B3 based on Moody's view
that a debt restructuring is inevitable. Moody's has also changed
Dex's Probability of Default Rating (PDR) to Ca/LD from B3
following the company's purchase of about $142 million of par
value bank debt for about $70 million in cash. The Caa3 rating
also reflects Moody's view that additional exchanges at a discount
are likely in the future since the company amended its bank
covenants to make it possible to repurchase additional bank debt
on the open market through the end of 2013.
As reported by the TCR on April 4, 2012, Standard & Poor's Ratings
Services raised its corporate credit rating on Cary, N.C.-based
Dex One Corp. and related entities to 'CCC' from 'SD' (selective
default). "The upgrade reflects our assessment of the company's
credit profile after the completion of the subpar repurchase
transaction in light of upcoming maturities, future subpar
repurchases, and our expectation of a continued week operating
outlook," explained Standard & Poor's credit analyst Chris
Valentine.
DREIER LLP: Has Nod to Hire Constellation as Advisor, Witness
-------------------------------------------------------------
The Hon. Stuart M. Bernstein of the U.S. Bankruptcy Court for the
Southern District of New York has granted Sheila M. Gowan, the
Chapter 11 trustee for Dreier LLP, permission to retain
Constellation Investment Consulting Corp. as special litigation
advisor, and potentially testifying expert witness, concerning the
investment and due diligence performed by hedge fund participants
in the Marc Dreier Ponzi scheme, nunc pro tunc to June 28, 2012.
As reported by the Troubled Company Reporter on July 26, 2012, the
Chapter 11 Trustee previously commenced these adversary
proceedings pertinent to the application: (i) Gowan v. Amaranth
Advisors LLC, et. al, Case No. 10-3493 (SMB); (ii) Gowan v. The
Patriot Group, LLC, et. al, Case No. 10-3524 (SMB); and (iii)
Gowan v. Westford Asset Management LLC, et. al, Case No. 10-5447
(SMB).
In the adversary proceedings, the Chapter 11 Trustee alleges that
Marc S. Dreier, DLLP, perpetrated a Ponzi scheme involving the
sale of fictitious promissory notes, that each of the defendants
named in the adversary proceedings invested in the Note Fraud,
that the defendants received transfers from DLLP pursuant to the
note fraud, and that those transfers constituted avoidable
fraudulent transfers, well as under applicable sections of the New
York Debtor & Creditor Law. According to the Chapter 11 Trustee,
Constellation is the best candidate to advise her in the pursuit
to recover over $150 million that was paid to defendants as a
result of their investments in the note fraud.
About Marc Dreier and Dreier LLP
Marc Dreier founded New York-based law firm Dreier LLP --
http://www.dreierllp.com/-- in 1996. On Dec. 8, 2008, the U.S.
Securities and Exchange Commission filed a suit, alleging that Mr.
Dreier made fraudulent offers and sales of securities in several
cities, selling fake promissory notes to hedge and other private
investment funds. The SEC asserted that Mr. Dreier also
distributed phony financial statements and audit opinions, and
recruited accomplices in connection with that scheme. Mr. Dreier,
currently in prison, was charged by the U.S. government for
conspiracy, securities fraud and wire fraud (S.D.N.Y. Case No.
09-cr-00085).
Dreier LLP sought Chapter 11 protection (Bankr. S.D.N.Y. Case No.
08-15051) on Dec. 16, 2008. Stephen J. Shimshak, Esq., at Paul,
Weiss, Rifkind, Wharton & Garrison LLP, was tapped as counsel.
The Debtor estimated assets of $100 million to $500 million, and
debts between $10 million and $50 million in its Chapter 11
petition.
Sheila M. Gowan, a partner with Diamond McCarthy, was appointed
Chapter 11 trustee for the Dreier law firm. Ms. Gowan is
represented by Jason Porter, Esq., at Diamond McCarthy LLP.
Wachovia Bank National Association, the Dreier LLP Chapter 11
trustee, and Steven J. Reisman as post-confirmation representative
of the bankruptcy estate of 360networks (USA) Inc. signed a
petition that put Mr. Dreier into bankruptcy under Chapter 7 on
Jan. 26, 2009 (Bankr. S.D.N.Y. Case No. 09-10371). Mr. Dreier,
60, pleaded guilty to fraud and other charges in May 2009. The
scheme to sell $700 million in fake notes unraveled in late 2008.
Mr. Dreier is serving a 20-year sentence in a federal prison in
Minneapolis.
DIGITAL DOMAIN: Has Nod to Hire Thomas Johnson as Appraiser
-----------------------------------------------------------
Digital Domain Media Group Inc. obtained authorization from the
Hon. Brendan L. Shannon of the U.S. Bankruptcy Court for the
District of Delaware to employ Thomas Johnson & Associates as real
estate appraiser, nunc pro tunc to Oct. 15, 2012.
Digital Domain is hiring the Appraiser to, among other things:
-- appraise the real property located at 10250 SW Village
Parkway in Port St. Lucie, Florida, comprising (i) the
Debtor's purpose-built, 115,000 square foot animation studio
and (ii) vacant four acre parcel of real property adjoining
the animation studio;
-- assist the proposed real estate broker in accurately
marketing the property.
The Appraiser will be paid $6,950 in the aggregate, for the
appraisal of the Property.
Thomas J. Johnson, a principal of the Appraiser, attested to the
Court that the firm is a "disinterested person" as that term is
defined in Section 101(14) of the Bankruptcy Code.
About Digital Domain
Port St. Lucie, Florida-based Digital Domain Media Group, Inc. --
http://www.digitaldomain.com/-- engaged in the creation of
original content animation feature films, and development of
computer-generated imagery for feature films and trans-media
advertising primarily in the United States.
Digital Domain Media Group, Inc. and 13 affiliates sought
Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-12568) on
Sept. 11, 2012, to sell its business for $15 million to
Searchlight Capital Partners LP, subject to higher and better
offers.
At the auction on Sept. 21, the principal part of the business was
purchased by a joint venture between Galloping Horse America LLC,
an affiliate of Beijing Galloping Horse Co., and an affiliate of
Reliance Capital Ltd., based in Mumbai. The $36.7 million total
value of the contact includes $3.6 million to cure defaults on
contracts and $2.9 million in reimbursement of payroll costs.
Attorneys at Pachulski Stang Ziehl & Jones serve as counsel to the
Debtors. FTI Consulting, Inc.'s Michael Katzenstein is the chief
restructuring officer. Kurtzman Carson Consultants LLC is the
claims and notice agent.
An official committee of unsecured creditors appointed in the case
is represented by lawyers at Sullivan Hazeltine Allinson LLC and
Brown Rudnick LLP.
The company disclosed assets of $205 million and liabilities
totaling $214 million. Debt includes $40 million on senior
secured convertible notes plus $24.7 million in interest. There
is another issue of $8 million in subordinated secured convertible
notes.
The Debtors also have sought ancillary relief in Canada, pursuant
to the Companies' Creditors Arrangement Act in the Supreme Court
of British Columbia, Vancouver Registry.
DIGITAL DOMAIN: Has Court OK for DeSantis Commercial as Broker
--------------------------------------------------------------
The Hon. Brendan L. Shannon of the U.S. Bankruptcy Court for the
District of Delaware has granted Digital Domain Media Group Inc.
and its affiliates permission to employ DeSantis Commercial, Inc.,
as real estate broker. DeSantis Commercial will be marketing and
selling the Debtors' property located at SW Gatlin Boulevard, in
Port St. Lucie, Florida.
About Digital Domain
Port St. Lucie, Florida-based Digital Domain Media Group, Inc. --
http://www.digitaldomain.com/-- engaged in the creation of
original content animation feature films, and development of
computer-generated imagery for feature films and trans-media
advertising primarily in the United States.
Digital Domain Media Group, Inc. and 13 affiliates sought
Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-12568) on
Sept. 11, 2012, to sell its business for $15 million to
Searchlight Capital Partners LP, subject to higher and better
offers.
At the auction on Sept. 21, the principal part of the business was
purchased by a joint venture between Galloping Horse America LLC,
an affiliate of Beijing Galloping Horse Co., and an affiliate of
Reliance Capital Ltd., based in Mumbai. The $36.7 million total
value of the contact includes $3.6 million to cure defaults on
contracts and $2.9 million in reimbursement of payroll costs.
Attorneys at Pachulski Stang Ziehl & Jones serve as counsel to the
Debtors. FTI Consulting, Inc.'s Michael Katzenstein is the chief
restructuring officer. Kurtzman Carson Consultants LLC is the
claims and notice agent.
An official committee of unsecured creditors appointed in the case
is represented by lawyers at Sullivan Hazeltine Allinson LLC and
Brown Rudnick LLP.
The company disclosed assets of $205 million and liabilities
totaling $214 million. Debt includes $40 million on senior
secured convertible notes plus $24.7 million in interest. There
is another issue of $8 million in subordinated secured convertible
notes.
The Debtors also have sought ancillary relief in Canada, pursuant
to the Companies' Creditors Arrangement Act in the Supreme Court
of British Columbia, Vancouver Registry.
DIGITAL DOMAIN: Has Nod to Hire Heritage Global as Sales Agent
--------------------------------------------------------------
The Hon. Brendan L. Shannon of the U.S. Bankruptcy Court for the
District of Delaware has granted Digital Domain Media Group Inc.
authorization to employ Heritage Global Partners, Inc., as sales
agent and auctioneer, nunc pro tunc to Nov. 17, 2012, for the sale
and auction of the Debtors' personal property located in Florida
consisting generally of office equipment and computer equipment.
The material terms of the engagement agreement include, among
other things:
-- the auctioneer will act as sales agent and auctioneer
for the auction and sale of the remaining property assets;
-- the auctioneer will charge a buyer's premium of 15% of the
aggregate gross proceeds for the cash sale of remaining
personal property (or 18% if for property purchased by
credit card), payable by the buyers; and
-- no sales commission will be paid to any of the auctioneer
proceeds from the sale of any remaining personal property
assets.
About Digital Domain
Port St. Lucie, Florida-based Digital Domain Media Group, Inc. --
http://www.digitaldomain.com/-- engaged in the creation of
original content animation feature films, and development of
computer-generated imagery for feature films and trans-media
advertising primarily in the United States.
Digital Domain Media Group, Inc. and 13 affiliates sought
Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-12568) on
Sept. 11, 2012, to sell its business for $15 million to
Searchlight Capital Partners LP, subject to higher and better
offers.
At the auction on Sept. 21, the principal part of the business was
purchased by a joint venture between Galloping Horse America LLC,
an affiliate of Beijing Galloping Horse Co., and an affiliate of
Reliance Capital Ltd., based in Mumbai. The $36.7 million total
value of the contact includes $3.6 million to cure defaults on
contracts and $2.9 million in reimbursement of payroll costs.
Attorneys at Pachulski Stang Ziehl & Jones serve as counsel to the
Debtors. FTI Consulting, Inc.'s Michael Katzenstein is the chief
restructuring officer. Kurtzman Carson Consultants LLC is the
claims and notice agent.
An official committee of unsecured creditors appointed in the case
is represented by lawyers at Sullivan Hazeltine Allinson LLC and
Brown Rudnick LLP.
The company disclosed assets of $205 million and liabilities
totaling $214 million. Debt includes $40 million on senior
secured convertible notes plus $24.7 million in interest. There
is another issue of $8 million in subordinated secured convertible
notes.
The Debtors also have sought ancillary relief in Canada, pursuant
to the Companies' Creditors Arrangement Act in the Supreme Court
of British Columbia, Vancouver Registry.
DIGITAL DOMAIN: Can Hire MDT Executive as Financial Advisor
-----------------------------------------------------------
The Official Committee of Unsecured Creditors in the Chapter 11
cases of Digital Domain Media Group, Inc. et al., obtained
permission from the Hon. Brendan L. Shannon of the U.S. Bankruptcy
Court for the District of Delaware to retain MDT Executive
Management Co., LLC, as financial advisor.
MDT will, among other things: (i) assist and advise the Committee
in developing a general strategy with the Chapter 11 cases; (ii)
assist the Committee in connection with its assessment of the
Debtors' cash and liquidity requirements, well as the Debtors'
financing requirements; and (iii) assist the Committee in
connection with its evaluation of the Debtor's statements of
financial affairs and supporting schedules, executory contracts
and claims.
About Digital Domain
Port St. Lucie, Florida-based Digital Domain Media Group, Inc. --
http://www.digitaldomain.com/-- engaged in the creation of
original content animation feature films, and development of
computer-generated imagery for feature films and trans-media
advertising primarily in the United States.
Digital Domain Media Group, Inc. and 13 affiliates sought
Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-12568) on
Sept. 11, 2012, to sell its business for $15 million to
Searchlight Capital Partners LP, subject to higher and better
offers.
At the auction on Sept. 21, the principal part of the business was
purchased by a joint venture between Galloping Horse America LLC,
an affiliate of Beijing Galloping Horse Co., and an affiliate of
Reliance Capital Ltd., based in Mumbai. The $36.7 million total
value of the contact includes $3.6 million to cure defaults on
contracts and $2.9 million in reimbursement of payroll costs.
Attorneys at Pachulski Stang Ziehl & Jones serve as counsel to the
Debtors. FTI Consulting, Inc.'s Michael Katzenstein is the chief
restructuring officer. Kurtzman Carson Consultants LLC is the
claims and notice agent.
An official committee of unsecured creditors appointed in the case
is represented by lawyers at Sullivan Hazeltine Allinson LLC and
Brown Rudnick LLP.
The company disclosed assets of $205 million and liabilities
totaling $214 million. Debt includes $40 million on senior
secured convertible notes plus $24.7 million in interest. There
is another issue of $8 million in subordinated secured convertible
notes.
The Debtors also have sought ancillary relief in Canada, pursuant
to the Companies' Creditors Arrangement Act in the Supreme Court
of British Columbia, Vancouver Registry.
DYNEGY INC: Files Ch. 11 Liquidation Plan for NY Subsidiaries
-------------------------------------------------------------
Jamie Santo at Bankruptcy Law360 reports that Dynegy Inc. on
Friday submitted a Chapter 11 liquidation plan and related
disclosure statement for its four units remaining in bankruptcy,
aimed at winding up those operations in the wake of the sale of
two upstate New York power plants.
Filed Friday in New York bankruptcy court's Southern District, the
liquidation plan and disclosure statement filed will resolve the
affairs of the "operating debtors" -- Dynegy Northeast Generation
Inc., Hudson Power LLC, Dynegy Danskammer LLC and Dynegy Roseton
LLC.
About Dynegy
Through its subsidiaries, Houston, Texas-based Dynegy Inc.
(NYSE: DYN) -- http://www.dynegy.com/-- produces and sells
electric energy, capacity and ancillary services in key U.S.
markets. The power generation portfolio consists of approximately
12,200 megawatts of baseload, intermediate and peaking power
plants fueled by a mix of natural gas, coal and fuel oil.
Dynegy Holdings LLC and four other affiliates of Dynegy Inc.
sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case
No. 11-38111) on Nov. 7, 2011, to implement an agreement with a
group of investors holding more than $1.4 billion of senior notes
issued by Dynegy's direct wholly-owned subsidiary, Dynegy
Holdings, regarding a framework for the consensual restructuring
of more than $4.0 billion of obligations owed by DH. If this
restructuring support agreement is successfully implemented, it
will significantly reduce the amount of debt on the Company's
consolidated balance sheet. Dynegy Holdings disclosed assets of
$13.77 billion and debt of $6.18 billion.
Dynegy Inc. on July 6, 2012, filed a voluntary petition to
reorganize under Chapter 11 (Bankr. S.D.N.Y. Case No. 12-36728) to
effectuate a merger with Dynegy Holdings, pursuant to Holdings'
Chapter 11 plan.
A settlement, which has already been approved by the bankruptcy
court, provides for Dynegy Inc. and Holdings to merge and for the
administrative claim granted to Dynegy Inc. in the Holdings
Chapter 11 case to be transferred out of Dynegy Inc. for the
benefit of its shareholders.
Dynegy Holdings and its affiliated debtor-entities are represented
in the Chapter 11 proceedings by Sidley Austin LLP as their
reorganization counsel. Dynegy and its other subsidiaries are
represented by White & Case LLP, who is also special counsel to
the Debtor Entities with respect to the Roseton and Danskammer
lease rejection issues. The financial advisor is FTI Consulting.
The Official Committee of Unsecured Creditors in Holdings' cases
has tapped Akin Gump Strauss Hauer & Feld LLP as counsel.
Dynegy Inc. is represented by White & Case LLP and advised by
Lazard Freres & Co. LLC.
Dynegy Inc. successfully completed its Chapter 11 reorganization
and emerged from bankruptcy October 1.
Dynegy Northeast Generation, Inc., Hudson Power, L.L.C., Dynegy
Danskammer, L.L.C. and Dynegy Roseton, L.L.C., remain under
Chapter 11 protection.
As of July 31, 2012, Dynegy Inc. had total assets of
$3.15 billion, total liabilities of $3.14 billion and total
stockholders' equity of $6.68 million.
EASTMAN KODAK: Judge OKs $830MM Financing Commitment Letter
-----------------------------------------------------------
Lisa Uhlman at Bankruptcy Law360 reports that Eastman Kodak Co.
can now begin working out the terms of $830 million in new exit
financing with a group of second-lien noteholders while
entertaining better offers, following a New York bankruptcy
judge's Friday approval of commitment documents with the lenders.
U.S. Bankruptcy Judge Allan L. Gropper signed off on the financing
commitment documents for secured supplemental post-petition and
exit financing, which the debtor will now enter into with the
steering committee of the second-lien noteholders committee,
Bankruptcy Law360 relates.
About Eastman Kodak
Rochester, New York-based Eastman Kodak Company and its U.S.
subsidiaries on Jan. 19, 2012, filed voluntarily Chapter 11
petitions (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan.
Subsidiaries outside of the U.S. were not included in the filing
and are expected to continue to operate as usual.
Kodak, founded in 1880 by George Eastman, was once the world's
leading producer of film and cameras. Kodak sought bankruptcy
protection amid near-term liquidity issues brought about by
steeper-than-expected declines in Kodak's historically profitable
traditional businesses, and cash flow from the licensing and sale
of intellectual property being delayed due to litigation tactics
employed by a small number of infringing technology companies with
strong balance sheets and an awareness of Kodak's liquidity
challenges.
In recent years, Kodak has been working to transform itself from a
business primarily based on film and consumer photography to a
smaller business with a digital growth strategy focused on the
commercialization of proprietary digital imaging and printing
technologies. Kodak has 8,900 patent and trademark registrations
and applications in the United States, as well as 13,100 foreign
patents and trademark registrations or pending registration in
roughly 160 countries.
Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt &
Taylor, LLP, serve as counsel to the Debtors. FTI Consulting,
Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is
the investment banker. Kurtzman Carson Consultants LLC is the
claims agent.
The Official Committee of Unsecured Creditors has tapped Milbank,
Tweed, Hadley & McCloy LLP, as its bankruptcy counsel.
Michael S. Stamer, Esq., David H. Botter, Esq., and Abid Qureshi,
Esq., at Akin Gump Strauss Hauer & Feld LLP, represent the
Unofficial Second Lien Noteholders Committee.
The Retirees Committee has hired Haskell Slaughter Young &
Rediker, LLC, and Arent Fox, LLC as Co-Counsel; Zolfo Cooper, LLC,
as Bankruptcy Consultants and Financial Advisors; and the Segal
Company, as Actuarial Advisors.
Robert J. Stark, Esq., Andrew Dash, Esq., and Neal A. D'Amato,
Esq., at Brown Rudnick LLP, represent Greywolf Capital Partners
II; Greywolf Capital Overseas Master Fund; Richard Katz, Kenneth
S. Grossman; and Paul Martin.
EDISON MISSION: Moody's Cuts PDR to 'D' on Bankruptcy Filing
------------------------------------------------------------
Moody's Investors Service lowered Edison Mission Energy's (EME)
Probability of Default Rating to D from Ca, following the
bankruptcy filings of EME and other subsidiaries, including
Midwest Generation, LLC (MWG) in the U.S. Bankruptcy Court for the
Northern District of Illinois. Concurrently, Moody's affirmed its
other ratings assigned to EME and MWG including EME's Corporate
Family and Senior Unsecured Rating of Ca, EME's Speculative Grade
Liquidity of SGL-4, and MWG's senior secured pass-through
certificates of Caa1.
Subsequent to the actions, Moody's will withdraw the ratings
listed below because EME and MWG has entered bankruptcy.
Downgrades:
Issuer: Edison Mission Energy
Probability of Default Rating, Downgraded to D from Ca
Affirmations:
Issuer: Edison Mission Energy
Corporate Family Rating, Affirmed at Ca
Senior Unsecured Regular Bond/Debenture, Affirmed at Ca,
LGD4, 59 %
Speculative Grade Liquidity Rating, Affirmed at SGL-4
Affirmation and LGD Revised:
Issuer: Midwest Generation LLC
Senior Secured Pass-Through Certificates due 2016 at Caa1,
to LGD1, 8% from LGD2, 15%
Ratings Rationale
The rating action reflects the bankruptcy filing by EME and
sixteen of its wholly-owned subsidiaries, including one of its
primary subsidiaries, MWG. The bankruptcy filing was made in
conjunction with a Transaction Support Agreement entered into by
Edison International, EME, and certain of the EME creditors,
involving a framework for restructuring approximately $3.7 billion
in EME senior unsecured debt. Additionally, Moody's understands
that EME and MWG have entered into a sixty day forbearance
agreement with lease debt and lease equity associated with the
Powerton-Joliet (PoJo) sale leaseback transaction. There is $345
million of senior secured pass-through certificates outstanding
related to this transaction.
Moody's assessment of loss-given-default has remained largely
unchanged following the bankruptcy announcement on December 16,
2012 as the current ratings had largely incorporated some form of
restructuring at EME. With respect to EME, the Ca rating
incorporates moderate to low recovery prospects for creditors, the
majority of which are senior unsecured noteholders.
For MWG, the Caa1 rating assigned to the PoJo senior secured pass-
through certificates incorporates high recovery prospects (90-100%
range) for leaseholders given the modest amount of remaining
outstanding debt and the value Moody's ascribes to the PoJo
assets.
The principal methodology used in this rating was Unregulated
Utilities and Power Companies published in August 2009 and Loss
Given Default for Speculative-Grade Non-Financial Companies in the
U.S., Canada and EMEA published in June 2009.
Headquartered in Santa Ana, California, EME is an unregulated
generation company that owns operations in the US, with Chicago,
Illinois based MWG being a primary subsidiary. At December 31,
2011, EME had total assets of $8.3 billion.
ELITE PHARMACEUTICALS: CEO Hikes Bridge Loan to $1 Million
----------------------------------------------------------
Elite Pharmaceuticals, Inc., has amended the bridge loan agreement
with Jerry Treppel, Elite's Chairman & CEO, pursuant to which Mr.
Treppel has agreed to increase the maximum principal amount of the
line of credit from $500,000 to $1,000,000. All other terms
remain the same. The additional proceeds will be used primarily
for working capital to support Elite's increase in production and
growth of sales.
A copy of the amendment to the Loan Agreement is available at:
http://is.gd/Wl1Wdb
About Elite Pharmaceuticals
Northvale, New Jersey-based Elite Pharmaceuticals, Inc., is a
specialty pharmaceutical company principally engaged in the
development and manufacture of oral, controlled-release products,
using proprietary technology and the development and manufacture
of generic pharmaceuticals. The Company has one product,
Phentermine 37.5mg tablets, currently being sold commercially.
Elite Pharmaceuticals reported a net loss attributable to common
shareholders of $15.05 million for the year ended March 31, 2012,
compared with a net loss attributable to common shareholders of
$13.58 million during the prior year.
Demetrius & Company, L.L.C., in Wayne, New Jersey, issued a "going
concern" qualification on the consolidated financial statements
for the year ended March 31, 2012, citing significant losses
resulting in a working capital deficiency and shareholders'
deficit, which raise substantial doubt about the Company's ability
to continue as a going concern.
ENERGY FUTURE: Promotes McFarland to Pres. & CEO of Luminant
------------------------------------------------------------
David A. Campbell, president and chief executive officer of
Luminant Holding Company LLC, an indirect subsidiary of Energy
Future Holdings Corp. and Energy Future Competitive Holdings
Company, gave notice that he would resign effective immediately
following the end of the fiscal year on Dec. 31, 2012.
The Company promoted M.A. (Mac) McFarland to President and Chief
Executive Officer of Luminant, effective Jan. 1, 2013. Mr.
McFarland has served as Executive Vice President of the Company
and Executive Vice President and Chief Commercial Officer of
Luminant since July 2008.
In connection with his promotion, Mr. McFarland's base salary was
increased from $600,000 per year to $675,000 per year. Mr.
McFarland, Luminant and the Company entered into an Amended and
Restated Employment Agreement, effective as of Jan. 1, 2013,
setting forth Mr. McFarland's new title, duties, and base salary.
About Energy Future
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a portfolio
of competitive and regulated energy businesses in Texas. Oncor,
an 80%-owned entity within the EFH group, is the largest regulated
transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
Energy Future had a net loss of $1.91 billion on $7.04 billion of
operating revenues for the year ended Dec. 31, 2011, compared with
a net loss of $2.81 billion on $8.23 billion of operating revenues
during the prior year.
The Company's balance sheet at Sept. 30, 2012, showed
$42.73 billion in total assets, $51.90 billion in total
liabilities and a $9.16 billion total deficit.
* * *
As reported by the TCR on Aug. 15, 2012, Moody's downgraded the
Corporate Family Rating (CFR) of EFH to Caa3 from Caa2 and
affirmed its Caa3 Probability of Default Rating (PDR) and SGL-4
Speculative Grade Liquidity Rating. The downgrade of EFH's CFR to
Caa3 from Caa2 reflects the company's financial distress and
limited financial flexibility.
As reported by the TCR on Dec. 7, 2012, Fitch Ratings has lowered
the Issuer Default Rating (IDR) of EFH to 'Restricted
Default' (RD) from 'CC'. Fitch Ratings has deemed the recently
concluded exchange offer to exchange a portion of the LBO notes
and legacy notes at Energy Future Holdings Corp (EFH) for new
11.25%/12.25% senior toggle notes due 2018 at Energy Future
Intermediate Holding Company LLC (EFIH) as a distressed debt
exchange (DDE).
In the Dec. 10, 2012, edition of the TCR, Standard & Poor's
Ratings Services lowered its corporate credit rating on Energy
Future Holdings Corp. (EFH) to 'SD' from 'CCC' based on the
consummation of a distressed debt exchange of five EFH-level debt
securities totaling about $1.6 billion with the new Energy Future
Intermediate Holding Co. LLC (EFIH) senior secured toggle notes
due 2018 of about $1.1 billion.
EP ENERGY: S&P Rates New $350-Mil. PIK Notes Due 2017 'B'
---------------------------------------------------------
Standard & Poor's Ratings Services assigned issue-level and
recovery ratings to Houston-based EP Energy LLC's proposed $350
million pay-in-kind (PIK) notes due 2017. The notes are to be
issued by EP Energy's parent company, EPE Holdings LLC, and co-
issuer EP Energy BondCo Inc. The issue rating on the PIK notes is
'B' (two notches lower than the corporate credit rating on EP
Energy). "The recovery rating is '6', indicating our expectation
of negligible (0% to 10%) recovery in the event of default. The
PIK debt is structurally subordinated to the existing secured and
unsecured debt at EP Energy LLC," S&P said.
"Proceeds will be paid out as a cash dividend to the owners of EPE
Holdings LLC: private equity investors including Apollo Global
Management LLC, Access Industries Inc. and Riverstone Holdings LP.
Despite the increase in total debt we project the company's debt
to EBITDAX to remain in the 3.5x to 4.0x range, which is
appropriate for the rating," S&P said.
"The 'BB-' rating and stable outlook on EP Energy LLC reflect our
assessment of the company's 'fair' business risk and 'aggressive'
financial risk. The ratings incorporate the company's medium size
and scale; its meaningful exposure to natural gas (70% of year-end
2011 proven reserves and about 75% of current production); its
relatively high leverage compared with peers; and its position in
a highly cyclical, capital-intensive, and competitive industry.
The ratings also reflect the company's good natural gas hedging
position, 'adequate' liquidity, and its ongoing shift to higher
margin oil production," S&P said.
RATINGS LIST
EP Energy LLC
Corporate credit rating BB-/Stable/--
New Ratings
EPE Holdings LLC
EP Energy BondCo Inc.
Proposed $350 mil PIK nts due 2017 B
Recovery rating 6
EPE HOLDINGS: Moody's Rates $350MM Senior PIK Toggle Note 'B3'
--------------------------------------------------------------
Moody's Investors Service assigned a B3 rating to the proposed
$350 million senior unsecured PIK toggle note offering by EPE
Holdings LLC (EPE) and EP Energy BondCo Inc. Moody's also assigned
a Ba3 Corporate Family Rating (CFR) and a Ba3 Probability of
Default Rating (PDR) to EPE and withdrew the CFR and PDR for EP
Energy LLC (EP Energy). EP Energy's Ba3 second lien senior note
rating and second lien term loan rating and the B2 senior
unsecured note rating were affirmed. The outlook is stable. The
proceeds of the new PIK toggle notes will be used to make a
distribution to EPE's equity holders.
"The issuance of debt by EPE to make a distribution to the equity
holders is clearly a credit negative event," said Stuart Miller,
Moody's Senior Credit Officer. "Despite the increase in debt, we
did not change the existing ratings at EP Energy LLC as the
incremental debt at EPE is structural subordinated and the toggle
feature offers a degree of default protection to the existing
lenders and note holders."
Ratings Rationale
EPE Holdings LLC is a large and relatively diversified,
independent oil and gas exploration & production (E&P) company.
The company is currently producing about 145,000 Boe per day
ranking it as one of the largest non-investment grade E&P
companies Moody's rates. While historically natural gas focused,
the company is migrating towards more exposure to oil and liquids-
rich natural gas production. As of September 30, 2012 , over 20%
of EPE's production was liquids-oriented and this percentage is
projected to double over the next three to five years. The higher
share of liquids production will create a more balanced cash flow
stream and reduce the exposure to the natural gas market which is
expected to remain depressed for the next few years. An aggressive
natural gas hedging strategy provides short term protection
against low natural gas prices as the transition to oil is
implemented.
Offsetting its large scale, EPE's balance sheet is highly
leveraged. As of September 30, 2012 and pro forma for the new PIK
notes, debt to average daily production was more than $32,000 per
Boe. This leverage level is more typical of single B rated
companies. Over time, Moody's believes this ratio could head
higher as the company out spends cashflow in 2013 by aggressively
developing its Eagle Ford Shale acreage. However, the increasing
leverage should be offset by improving net cash margin as the
transition to liquids continues.
The B3 rating for the PIK notes reflects both the overall
probability of default of EPE, to which Moody's assigns a PDR of
Ba3, and a loss given default of LGD6-100%. The EPE PIK notes are
rated one notch below the senior unsecured debt at the EP Energy
level, which is in turn, two notches below the Ba3 CFR. The senior
unsecured debt at EP Energy is subordinated to significant amounts
of first lien and second lien debt causing the double notching.
The results of Moody's Loss Given Default Methodology for all of
the debt that is senior to the PIK notes have been overridden and
dropped by one notch. The Methodology model assumes that the new
PIK notes provide additional cushion to support the more senior
obligations of EP Energy. However, Moody's believes an override is
appropriate to prevent "up-lift" from the PIK notes, the proceeds
of which are being used to fund a dividend.
EPE has good liquidity. The company is expected to generate
negative free cash flow over the next 12 to 18 months. However,
the deficit can be financed by borrowings under EP Energy's $2
billion senior secured revolving credit facility that has minimal
usage at this time. Availability under the revolving credit
facility is governed by a borrowing base which is set at $1.8
billion. The revolving credit matures in 2017 and the company is
expected to remain in compliance with its debt to EBITDAX
financial covenant. Alternate liquidity is limited as 80% of EP
Energy's assets are mortgaged under the credit facility.
Moody's has a stable outlook for EPE. However, should the ratio of
debt to average daily production exceed $35,000 per Boe and appear
poised to remain at that level, a downgrade could be considered
unless the ratio of retained cash flow to debt is trending towards
25%. Alternatively, if leverage drops below $25,000 per Boe, it
may suggest a change to a more conservative financial profile
which could support an upgrade.
The principal methodology used in rating EPE was the Global
Independent Exploration and Production Industry Methodology
published in December 2011. Other methodologies used include Loss
Given Default for Speculative-Grade Non-Financial Companies in the
U.S., Canada and EMEA published in June 2009.
EPE Holdings LLC is the acquisition vehicle formed by Apollo
Global Management LLC, Riverstone Holdings LLC, Access Industries
Inc., Korea National Oil Company, and other investors to acquire
all of El Paso Corporation's oil and gas exploration & production
assets. EPE Holdings LLC is an independent exploration &
production company based in Houston, Texas.
EXIDE TECHNOLOGIES: Moody's Affirms 'B3' CFR/PDR; Outlook Neg.
--------------------------------------------------------------
Moody's Investors Service changed Exide Technologies' rating
outlook to negative from stable and concurrently affirmed Exide's
Corporate Family and Probability of Default Ratings at B3 and
senior secured note rating at B2. The Speculative Grade Liquidity
Rating is affirmed at SGL-3.
Ratings affirmed:
B3, Corporate Family Rating;
B3, Probability of Default Rating;
B2 (LGD3 35%) to the $675 million of senior secured notes due
2018;
SGL-3, Speculative Grade Liquidity Rating
RATINGS RATIONALE
Exide's negative rating outlook incorporates the company's weak
operating performance over the past two quarters which have
resulted in credit metrics deteriorating below previously
established thresholds supportive of a B3 rating. The company has
initiated several actions to help improve operating performance
including the closure of its Bristol, TN transportation battery
facility; the closure of its Frisco, TX facility; and the idling
of secondary lead recycling operations at Reading, PA. The closure
of the Bristol facility is expected to improve operating earnings
$20 million to $25 million beginning in the latter part of fiscal
2013. These actions are expected to reduce the company's capacity
levels in its North American transportation business to demand
levels, and reduce the lead recycling operation's exposure to
recently volatile core costs. Moody's expects these actions to
support quarterly sequential improvement in profitability over the
near-term, albeit not above 1.0x quarterly EBIT/Interest
(including Moody's standard adjustment) until sometime in the
company's fiscal 2014. There is risk to achieving this improvement
which includes the successful execution of restructuring actions
and the weakening macroeconomic environment in the company's
European markets (approximately 56% of revenues).
Future events that have the potential to lower Exide's ratings
include lower global demand in the company's end markets, an
inability to manage commodity cost fluctuations, lower operating
performance due to the inability to offset lower demand with
restructuring savings, market share losses, or a more competitive
pricing environment The inability to achieve consecutive
sequential improvement in operating profits and operating profit
margin until EBIT/Interest is sustained above 1.0x could result in
a rating downgrade. Consideration for a lower rating also could
result from a deteriorating liquidity profile.
Consideration for a stable rating outlook could arise if the
company is able to sustain EBIT/interest coverage over 1.0x,
generate positive free cash flow, and maintain an adequate
liquidity profile.
The Speculative Liquidity Rating of SGL-3 reflects an adequate
liquidity profile over the next twelve months supported by
seasonal positive free cash flow in the second-half of the
company's fiscal year, availability under the company's revolving
credit and anticipated net proceeds of approximately $37 million
from the sale of a portion of the Frisco location. These proceeds
should bolster the $74 million of cash on the company's balance
sheet at September 30, 2012. The company's cash balances will need
to support calls on the cash during the first half of fiscal 2014.
These cash calls include seasonal working capital needs, the
maturity of the $60 million convertible notes in September 2013
and modest restructuring costs. Further weighing on the liquidity
profile is the company's use of short term uncommitted factoring
programs which amounted to $72.5 million as of September 30, 2012.
Availability under the $200 million asset-based revolving credit
facility maturing in January 2016 was $134.7 million, as of
September 30, 2012. Moody's expects this availability will
facilitate some operating flexibility in the event there is
further near-term profit pressure. However, a severe downturn in
demand driving weak profit margin may trigger the springing fixed
charge covenant of 1.0x, which becomes effective if availability
under the revolving credit facility falls below the greater of $30
million and 15% of the facility's aggregate commitments. Under
this scenario, Exide is unlikely to pass the springing fixed
charge coverage covenant test. The senior secured notes do not
have financial maintenance covenants.
Exide's B3 Corporate Family Rating continues to reflect the
company's business focus on the more stable automotive aftermarket
replacement battery market which represents about 75% of Exide's
transportation revenues (and 44% percent of total revenues). About
half of Exide's transportation revenues are generated in North
America where industry reports indicate that shipments of both
aftermarket and OEM batteries have increased on a year-to-date
basis through October 2012. As a provider of network power
batteries (about 18% of total revenues), Exide also is positioned
for growth in back-up power for use with telecommunications
systems, computer data centers, hospitals, air traffic control,
security systems, utility, railway, and military applications.
Further, Exide's European exposure is more concentrated in its
industrial segment than in automotive. Exide's cost reduction
actions and the reduction of the company's third-party lead sales
are expected to position the company for steadier growth and
profit trends.
The principal methodology used in rating Exide 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.
Exide, headquartered in Milton, GA, is one of the largest global
manufacturers of lead acid batteries. The company manufactures and
supplies lead acid batteries for transportation and industrial
applications worldwide. Revenues for the LTM period ending
September 30, 2011 were $3.0 billion.
FAIR FINANCE: Former CEO Has No Money to Appeal Conviction
----------------------------------------------------------
Jacqueline Palank, writing for Dow Jones' Daily Bankruptcy Review,
reports that Timothy Durham, the former chief executive of
National Lampoon and now-bankrupt Fair Finance Co., cited his own
poverty as the reason he can't afford the cost to pursue an appeal
of his conviction.
According to the report, Mr. Durham was convicted in June on
charges that he stole investor funds and blew them on classic
cars, expensive homes, a private jet and country-club dues. He
said in a federal court filing in his criminal case that he has no
funds to pay for an attorney. Mr. Durham, who has been
incarcerated in Leitchfield, Ky. since his conviction, said he
hasn't earned any money in the past year. He was arrested in March
2011 on charges that he and colleagues pocketed the money of
investors in Fair Finance, cheating them out of some $200 million.
According to the report, Mr. Durham said he stopped receiving
paychecks from National Lampoon in June 2011. He previously
grossed $16,660 per month. He said his home is in foreclosure and
all of his assets either are subject to criminal restitution or
have been targeted by the bankruptcy trustee winding down Fair
Finance.
According to the report, prosecutors said Mr. Durham and two other
executives, James F. Cochran and Rick D. Snow, pocketed investors'
money and diverted it to companies under their control as well as
into their own bank accounts. Court papers show that Mr. Durham,
50 years old, was later found guilty of 12 counts of wire and
securities fraud as well as conspiracy to commit wire and
securities fraud. On Nov. 30, he was ordered to pay $202.8 million
in restitution and sentenced to 50 years imprisonment. Mr. Snow,
49, and Mr. Cochran, 57, were each found guilty of some counts and
not guilty of others, earning Snow a 10-year prison sentence and
Mr. Cochran 25 years. Mr. Cochran is appealing his conviction.
About Fair Finance
Akron, Ohio-based investment company Fair Finance Co. was closed
following a November 2009 raid by the U.S. Federal Bureau of
Investigation. Fair Finance's owner, Indiana businessman Timothy
S. Durham, a Republican political contributor whose holdings
include National Lampoon Inc., has been targeted in lawsuits and
investigations over claims he funded a luxurious lifestyle with
the proceeds of a Ponzi scheme.
Three creditors -- Nick Spada, Jacques Dunaway, and Robert Ripley
-- filed on Feb. 8, 2010, a petition to send Fair Finance to
Chapter 7 liquidation (Bankr. N.D. Oh. Case No. 10-50494). David
Mucklow, Esq., serves as counsel to the petitioners. Brian Bash
was appointed bankruptcy trustee.
A motion to appoint a trustee filed by the petitioning creditors
said that Mr. Durham and co-owner James Cochran took $176 million
in loans transferred from the investment fund into Fair Holdings
LLC and DC Investments LLC. They used the money to fund
$220 million in other loans, according to the filing.
FIFTH SEASON: Incurs $3.8-Mil. Net Loss in Third Quarter
--------------------------------------------------------
Fifth Season International, Inc., filed its quarterly report on
Form 10-Q, reporting a net loss of $3.8 million on $20.8 million
of total revenue for the three months ended Sept. 30, 2012,
compared with a net loss of $1.5 million on $36.8 million of total
revenue for the same period last year.
For the nine months ended Sept. 30, 2012, the Company had a net
loss of $16.8 million on $93.1 million of total revenue, compared
with net income of $1.1 million on $136.5 million of total revenue
for the comparable period last year.
Loss from operations was $11.5 million during the nine months
ended Sept. 30, 2012, compared with loss from operations of
$2.9 million during the same period last year.
"Our administrative expenses increased $7 million, or 163.5%, to
$11 million in the nine months ended September 30, 2012, from
$4 million in the same period in 2011."
The Company recognized a gain on business combination of
$7.1 million in the nine months ended Sept. 30, 2011, resulting
from the acquisition of Zibo Longyun Industrial and Trade Co.,
Ltd., during the first quarter of 2011.
The Company's balance sheet at Sept. 30, 2012, showed
$194.0 million in total assets, $167.9 million in total
liabilities, and stockholders' equity of $26.1 million.
"The Group's consolidated current liabilities exceeded its
consolidated current assets by approximately $52 million as of
Sept. 30, 2012. In addition the Group has commitments for tenant
improvement projects and the purchase of commercial properties
totaling $10.7 million as of Sept. 30, 2012. Management believes
that these factors raise substantial doubt about the Company's
ability to continue as a going concern."
As at Sept. 30, 2012, the Company was in material compliance with
all its outstanding loans.
A copy of the Form 10-Q is available at http://is.gd/uJEI4f
About Fifth Season
Located in Shenzhen, People's Republic of China, Fifth Season
International, Inc., is engaged in the investment, assignment, and
leasing of commercial properties, in the operation of department
stores, and in the wholesale of goods in China. As at Sept. 30,
2012, the Company had invested or leased seven commercial
properties in Southeastern China, encompassing approximately
152,244 square meters, which includes three properties comprising
93,010 square meters, or approximately 61% of the properties,
directly owned by the Company. Many of the properties are
positioned as department stores with large commercial tenants,
including but not limited to Bank of China, and Boshiwa
International Holding Limited.
* * *
As reported in the TCR on April 23, 2012, Marcum Bernstein &
Pinchuk LLP, in New York, expressed substantial doubt about Fifth
Season's ability to continue as a going concern, following the
Company's results for the fiscal year ended Dec. 31, 2011. The
independent auditors noted that the Company has a significant
working capital deficiency. "[A]s of Dec. 31, 2011, the Company
is not in compliance with its loan covenant in connection with its
loan with China Construction Bank," the independent auditors said.
FLORIDA KEYS: S&P Withdraws 'BB+' Rating on Series 2010 Rev Bonds
-----------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its 'BB+' long-term
rating on Florida Keys College Campus Foundation, Inc.'s series
2010 senior leasehold industrial development revenue bonds, issued
on behalf of the Florida Keys Community College Foundation.
"We withdrew the rating due to a lack of timely and sufficient
information, as the 2011 audit is still in draft form," said
Standard & Poor's credit analyst Bianca Gaytan-Burrell.
FREDERICK'S OF HOLLYWOOD: Incurs $5.1MM Net Loss in Oct. 27 Qtr.
----------------------------------------------------------------
Frederick's of Hollywood Group Inc. reported a net loss of $5.08
million on $22.45 million of net sales for the three months ended
Oct. 27, 2012, compared with a net loss of $2.33 million on $28.36
million of net sales for the three months ended Oct. 29, 2011.
The Company's balance sheet at Oct. 27, 2012, showed $42.66
million in total assets, $48.44 million in total liabilities and a
$5.77 million total shareholders' deficiency.
"We have been concerned that, since the recession began, customers
have been conditioned for major price reductions. We experienced
firsthand the difficulty of trying to move away from such
promotional activity this quarter when we tested customer
tolerance for significantly lower promotional activity. While we
anticipated a drop in sales, we experienced a larger than
anticipated decline in customer traffic at our stores and on our
eCommerce site. As a result, we revised this strategy and have
returned to higher levels of promotional activity," stated Thomas
Lynch, the Company's Chairman and Chief Executive Officer. "As
previously disclosed, we are now sharing some of the costs of our
promotional activities with our vendors, which will help offset
some of the costs of the increased promotions."
A copy of the press release is available for free at:
http://is.gd/GsvYfp
About Frederick's of Hollywood
Frederick's of Hollywood Group Inc. (NYSE Amex: FOH) --
http://www.fredericks.com/-- through its subsidiaries, sells
women's intimate apparel, swimwear and related products under its
proprietary Frederick's of Hollywood brand through 122 specialty
retail stores, a world-famous catalog and an online shop.
Frederick's of Hollywood sought bankruptcy in July 10, 2000. On
Dec. 18, 2002, the court approved the company's plan of
reorganization, which became effective on Jan. 7, 2003, with the
closing of the Wells Fargo Retail Finance exit financing facility.
The Company incurred a net loss of $6.43 million for the year
ended July 28, 2012, compared with a net loss of
$12.05 million for the year ended July 30, 2011.
GAS & OIL: Ohio Appeals Court Affirms Ruling in DeCaprio Suit
-------------------------------------------------------------
The Court of Appeals of Ohio, Ninth District, Summit County,
affirmed a Sept. 30, 2011 judgment entry of the Summit County
Court of Common Pleas denying the motion of Angela DeCaprio, Julie
DeCaprio, Frank Demczyk, and Dee Luebke for summary judgment and
granting the motion for summary judgment filed by Joseph Moneskey,
the sole shareholder of Gas & Oil, Inc.
In October 2003, Glenn Bibey, an employee of Gas & Oil, Inc., was
on a call to deliver heating oil to a residence which had a
receptacle to contain it. He, however, arrived at the wrong
address and accidentally deposited approximately 250 gallons of
heating oil directly into the basement of the DeCaprios' home.
The DeCaprio home had no receptacle to contain the oil. The
DeCaprios filed a complaint for trespass and gross negligence
against Gas & Oil Inc., Mr. Bibey, and Mr. Moneskey, the sole
shareholder of Gas & Oil. Additionally, the DeCaprios' insurance
company, Western Reserve Mutual Casualty Company, filed a
subrogation complaint against Gas & Oil, Inc., Mr. Bibey, and Mr.
Moneskey. The trial court consolidated the cases.
Western Reserve filed a motion for summary judgment against Gas &
Oil, Mr. Bibey, and Mr. Moneskey. The trial court granted summary
judgment against Gas & Oil for negligence, trespass, and vicarious
liability and against Mr. Bibey for negligence and trespass, but
refused to pierce the corporate veil to hold Mr. Moneskey
personally liable for the actions of Gas & Oil. Further, the
trial court awarded Western Reserve damages against Gas & Oil in
the amount of $64,567.
Gas & Oil filed a voluntary Chapter 11 petition for bankruptcy,
and the lawsuit was stayed in the trial court. The DeCaprios
voluntarily dismissed their complaint against Gas & Oil without
prejudice but proceeded against Mr. Moneskey by filing a motion to
reinstate the case. In denying the DeCaprios' motion to reinstate
the case, the trial court also decided the issue of piercing the
corporate veil on its merits. The Court held that although Mr.
Moneskey was the sole shareholder, these facts do not support the
DeCaprios' claim that at the time of the incident in question the
corporate entity had no separate mind, will or existence of its
own and had no assets. Nor do they support the DeCaprios' claim
that Mr. Moneskey exercised control over Gas & Oil in such a
manner that justice requires piercing the corporate veil.
The DeCaprios appealed.
The appeals court reversed and remanded because the trial court
improperly converted the motion to reinstate into a motion for
summary judgment. On remand, the trial court granted the
DeCaprios' motion, and reinstated the case against Mr. Moneskey.
The DeCaprios filed a motion for summary judgment on the issue of
Mr. Moneskey's personal liability. In response, Mr. Moneskey
filed a memorandum in opposition/cross-motion for summary
judgment. The DeCaprios then filed a motion to strike the cross-
motion for summary judgment, reply brief, and memorandum in
opposition to the cross-motion for summary judgment. The trial
court denied the DeCaprios' motion to strike Mr. Moneskey's cross-
motion for summary judgment, denied the DeCaprios' motion for
summary judgment, and granted Mr. Moneskey's cross-motion for
summary judgment.
The DeCaprios timely appealed.
The case before the appeals court is, ANGELA DeCAPRIO, et al.,
Appellants, v. GAS & OIL, et al., Appellees, C.A. No. 26140 (Ohio
App. Ct.). A copy of the Court's Dec. 12, 2012 Decision and
Journal Entry is available at http://is.gd/sjjKlmfrom Leagle.com.
GENERAL GROWTH: S&P Affirms 'BB' Corporate Credit Rating
--------------------------------------------------------
Standard & Poor's Ratings Services affirmed its unsolicited 'BB'
corporate credit rating on Chicago-based General Growth Properties
Inc. and revised the outlook to stable from positive. "We also
affirmed our unsolicited 'BB+' issue-level rating and '2' recovery
rating on the senior unsecured notes (commonly referred to as the
Rouse notes) of GGP's subsidiary, The Rouse Co. L.P.," S&P said.
"Our unsolicited ratings on General Growth Properties Inc. (GGP)
reflect the company's 'satisfactory' business risk position as a
major U.S.-based mall owner, its fair management and governance
profile, and what we view as its 'aggressive' financial risk
profile," said credit analyst Scott Sprinzen. "With its portfolio
of 129 U.S. regional malls, GGP is the second-largest mall
owner/operator in the U.S. after Simon Property Group Inc. Its
properties are diversified geographically within the U.S., being
located in 41 states. In addition, GGP has a 46% equity interest
in a well-performing Brazilian mall operator, Aliansce Shopping
Centers S.A., which owns 16 mall properties. GGP has a diverse
tenant base, with no retailer/tenant accounting for more than 3.0%
of rents. Its leases are predominantly long term in tenor, and its
lease maturity schedule is well-staggered."
"Our outlook on GGP is now stable. GGP has made significant
progress in improving its operating performance and refinancing
its property-level secured debt to extend maturities and lock in
low interest rates. However, coverage and debt-leverage measures
remain relatively weak, reflecting GGP's high degree of financial
leverage, which is consistent with management's aggressive
financial policies, in our view. We currently see little
likelihood of an upgrade within the one-year time frame addressed
by our outlook. On the other hand, we could lower the rating if,
contrary to our current expectations, financial leverage were to
increase materially - with debt-to-EBITDA in excess of 10X - as a
result of an acceleration of growth initiatives or actions to
directly reward shareholders," S&P said.
GEOKINETICS HOLDINGS: Moody's Downgrades CFR/PDR to 'Ca'
--------------------------------------------------------
Moody's Investors Service downgraded Geokinetics Holdings USA,
Inc.'s Corporate Family Rating (CFR), its senior secured notes
rating and Probability of Default Rating (PDR) to Ca from Caa2.
The ratings were placed under review for further downgrade.
Ratings Rationale
The downgrade follows parent guarantor Geokinetics Inc.'s
(Geokinetics) announcement on December 17, 2012 that it would not
make the approximately $14.6 million interest payment due on its
9.75% senior secured notes due December 15, 2012. Geokinetics
intends to evaluate its ability to pay interest on the notes over
the 30-day grace period provided for in its Indenture. The 30-day
grace period expires January 14, 2013.
If the company is unable to make the payment by end of the grace
period, the probability of default will be lowered to LD to
reflect a limited default. Ratings could be downgraded to D and
withdrawn in the event of a negotiated settlement with creditors
or bankruptcy filing.
Geokinetics reported that it is attempting to negotiate a
restructuring of its capital structure, contemplating a conversion
of its $300 million secured notes to common equity and
extinguishing its preferred stock in exchange for cash or a
combination of cash, nominal common equity and warrants, a
restructuring likely to be implemented in an in-court
restructuring. If no such agreement is reached, the company is
likely to implement an in-court restructuring of its balance sheet
without a pre-negotiated plan. Either of these actions would lead
to a significant loss to existing debtholders and will be
considered a default by Moody's.
The principal methodology used in rating Geokinetics was the
Global Oilfield Services Industry Rating 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.
Geokinetics Holdings USA, Inc. is a wholly owned subsidiary of
Geokinetics Inc., whose debt it guarantees. Geokinetics Inc. is a
global provider of seismic data acquisition and processing
services, and is headquartered in Houston, Texas.
GEOKINETICS HOLDINGS: S&P Cuts CCR to 'D' on Missed Payment
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Geokinetics Holdings Inc. to 'D' from 'CCC-'. "We also
lowered our issue-level rating on its senior secured notes to 'D'
from 'CCC-'. The recovery rating on the notes remains unchanged at
'4', reflecting our expectation for average recovery (30% to 50%)
under a payment default," S&P said.
"The rating action follows Geokinetics' announcement on Dec. 17,
2012 that it missed its interest payment on its 9.75% senior
secured notes due in 2014," S&P said.
"Although it is operating under a 30-day grace period to make its
interest payment, we consider the grace period for interest
payment as tantamount to default if the payment is not cured
within five business days after the initially scheduled due date.
Given the company's very weak liquidity, we believe it is unlikely
that the company will make its payment within the five-day
window," said Standard & Poor's credit analyst Marc Bromberg.
"The company intends to restructure its capital structure during
the grace period, which expires Jan. 14, 2013. It currently
contemplates that under this restructuring, it could convert some
or all of its existing notes for common equity and that it will
extinguish its existing preferred stock for cash, common equity,
and warrants. If the company fails to restructure within the 30-
day grace period, it will attempt to enter into a forbearance
agreement with its noteholders in order to continue negotiating a
restructured capital structure," S&P said.
GEOKINETICS INC: Alejandra Veltmann Named VP and CAO
----------------------------------------------------
Geokinetics Inc. appointed Alejandra Veltmann as Vice President
and Chief Accounting Officer of the Company, effective as of
Dec. 3, 2012.
Ms. Veltmann, 44, previously served as the Company's Corporate
Controller since May 2011. Prior to joining the Company, in
September 2009 she founded an international financial consulting
practice for clients in the oil and gas services industry,
including the Company. From June 2007 to December 2008, she held
the position of Director of Compliance for Grey Wolf Drilling,
Inc., and was promoted to Controller, Operations in January 2009,
shortly after the company was acquired by Precision Drilling
(NYSE:PDS), a publicly held international oil and gas drilling
contractor, a position she held until August 2009. From 2002 to
May 2007, Ms. Veltmann held several financial management
positions, including consulting in the role of CFO for
entrepreneurial companies. Prior to that, she served as audit
senior manager for KPMG. Ms. Veltmann is a certified public
accountant and holds a BBA degree in Accounting from The
University of New Mexico.
On Dec. 12, 2012, the Company entered into an employment agreement
with Ms. Veltmann. The employment agreement provides for an
annual base salary of $225,000 and that Ms. Veltmann is eligible
to participate in the Company's Incentive Compensation Plan based
on an annual target of 50% of her annual base salary. Ms.
Veltmann is entitled to a lump-sum severance payment equal to 12
months' base salary if she resigns with good reason or if her
employment is terminated by the Company or its successor without
cause within six months after a change of control. If Ms.
Veltmann is not entitled to receive severance pay under the
preceding sentence, the Company will pay Ms. Veltmann severance
pay for six months if the Company terminates her employment
without cause within 18 months after the date of the employment
agreement.
In connection with her appointment as Vice President and Chief
Accounting Officer, the Company and Ms. Veltmann also entered into
an indemnification agreement.
About Geokinetics
Headquartered in Houston, Texas, Geokinetics Inc., a Delaware
corporation founded in 1980, is provides seismic data acquisition,
processing and integrated reservoir geosciences services, and
land, transition zone and shallow water OBC environment
geophysical services. These geophysical services include
acquisition of 2D, 3D, time-lapse 4D and multi-component seismic
data surveys, data processing and integrated reservoir geosciences
services for customers in the oil and natural gas industry, which
include national oil companies, major international oil companies
and independent oil and gas exploration and production companies
worldwide.
The Company's balance sheet at June 30, 2012, showed
$410.85 million in total assets, $580.10 million in total
liabilities, $88.19 million of Series B-1 Senior Convertible
Preferred Stock, and a stockholders' deficit of $257.44 million.
* * *
In the Oct. 5, 2011, edition of the TCR, Moody's Investors Service
downgraded Geokinetics Holdings, Inc.'s (Geokinetics) Corporate
Family Rating (CFR) and Probability of Default Rating (PDR) to
Caa2 from B3.
"The downgrade to Caa2 is driven by Geokinetics' lower than
expected margins in its international markets, constrained
liquidity and weak leverage metrics," commented Andrew Brooks,
Moody's Vice-President. "The negative outlook highlights the
company's continuing tight liquidity and weak financial metrics
even in an improved oil and gas operating environment."
As reported by the TCR on Oct. 3, 2011, Standard & Poor's Ratings
Services lowered its corporate credit and senior secured ratings
on Geokinetics Holdings Inc. (Geokinetics) to 'CCC+' from 'B-'.
The rating action reflects uncertainty surrounding the costs,
damage to reputation, and effect on operations following a
liftboat accident in the Southern Gulf of Mexico that led to four
fatalities, including two Geokinetics employees and two
subcontractors.
GIBSON ENERGY: S&P Revises Outlook on 'BB-' CCR to Positive
-----------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Calgary,
Alta.-based midstream oil services provider Gibson Energy ULC to
positive from stable. "At the same time, Standard & Poor's
affirmed its 'BB-' long-term corporate credit and senior unsecured
debt ratings on the company. The recovery rating on Gibson's
revolving credit facility and term loan B is unchanged at '3'. The
'3' recovery rating indicates our expectation of meaningful (50%-
70%) recovery in a default scenario," S&P said.
"The outlook revision reflects our expectation that Gibson's
improving EBITDA, a combination of organic growth capex and
acquisitions, will strengthen its credit measures," said Standard
& Poor's credit analyst Aniki Saha-Yannopoulos. "This improvement,
if continued, positions the company for an upgrade in the next
year. We also believe that Gibson's strong liquidity, through a
combination of improved cash flow, recent equity issuance, and
increased credit facility, will enable the company to focus on its
growth strategy through 2013," Ms. Saha-Yannopoulos added.
"The ratings on Gibson reflect Standard & Poor's view of the
company's 'fair' business risk profile and 'significant' financial
risk profile. We assess the management and governance as
'satisfactory'. The ratings incorporate our assessment of the
weaknesses associated with the company's moderate exposure
to commodity prices, high fixed charges, and integration risk
associated with the OMNI Energy Services Corp. acquisition. We
believe the company's diversified energy infrastructure assets,
which provide operational efficiency and cross-selling
opportunities, and the increasing crude production in the North
American markets (NAM) that benefits service offerings and
improving credit measures offset these weaknesses," S&P said.
Gibson is a midstream energy company operating in the NAM, mostly
in western Canada and U.S. Gulf Coast. It provides transport,
storage, and distribution of crude and associated products, and
provides crude transportation through trucking in the U.S. The
company operates in five segments that include terminals and
pipelines, truck transportation, propane and natural gas liquids
(NGL) marketing and distribution, processing and well-site fluid,
and marketing of crude and refined products. It recently acquired
OMNI, an environmental and production service provider in the U.S.
As of Sept. 30, 2012, it had adjusted total debt of about C$780
million, with most of the adjustments (about C$162 million) due to
operating leases and asset retirement obligations.
"The positive outlook reflects Standard & Poor's view that Gibson
will continue its positive EBITDA trajectory and cash flow
momentum, positioning it for an upgrade in the next 12 months. We
believe adjusted debt-to-EBITDA will improve to 2.0x-2.5x through
2013, because of the company's improved EBITDA generated from its
recent capital investments and acquisitions. At current levels of
EBITDA and debt, Gibson has sufficient debt capacity to borrow the
full commitment under its revolving credit facility without
affecting the ratings," S&P said.
"We will likely raise the ratings if the company maintains its
EBITDA growth, while successfully integrating the OMNI business
within its fold. We assume that Gibson will maintain its balance-
sheet profile and strong liquidity through this period," S&P said.
"We would downgrade the company if drilling activity or the
economy weakens and it is unable to generate improved cash flow so
that our calculated debt-to-EBITDA ratio starts deteriorating
above the 4x range. This could occur if EBITDA growth for 2013 and
2014 is 10% lower than 2012 levels. Also, aggressive financing of
growth initiatives, either through acquisition or capital
expenditures, without prospects for rapid deleveraging would lead
us to revisit our ratings and outlook," S&P said.
GMX RESOURCES: OKs Issue of New Series of 2017 Senior Notes
-----------------------------------------------------------
GMX Resources Inc. entered into a supplemental indenture to the
indenture governing Company's Senior Secured Notes due 2017 (CUSIP
Nos. 38011M AN8, 38011M AP3, U3822V AC2 and 38011M AQ1) to
authorize and permit the issuance of a new series of senior
secured notes due 2017 under the Indenture.
On Dec. 7, 2012, following the execution of the Supplemental
Indenture, the Company entered into purchase agreements with each
of the committed holders who previously executed commitment
agreements with the Company with respect to financing commitments
by the Committed Holders. The Purchase Agreements effected the
Company's private placements, with a closing on Dec. 7, 2012, of
(i) an aggregate of $30,000,000 aggregate principal amount of the
New Notes for net proceeds (after original issue discount) of
approximately $27.1 million, and (ii) an aggregate of 5,942,034
shares of common stock at a price of $0.48 per share, and an
aggregate of 10,037,219 additional shares of Common Stock at a
price of $0.01 per share, as partial consideration for the prior
financing commitments of those purchasers. The Private Placements
resulted in net cash proceeds to the Company on the closing date
of approximately $30.1 million.
The cash proceeds from the Private Placements will be used to
repay, redeem, repurchase or otherwise acquire or retire for value
the Company's 5.00% Senior Convertible Notes due 2013 outstanding
on the date of issuance of the New Notes at or prior to their
stated maturity date.
The New Notes mature in December 2017. The New Notes accrue cash
interest at 11.0% per annum. The New Notes will rank pari passu
in right of payment with the Existing Notes. The guarantees by
each guarantor of the New Notes will rank pari passu in right of
payment with the guarantee by such guarantor of the Existing
Notes. The Company's obligations under the New Notes will be
secured by liens on the same collateral securing the Existing
Notes, which liens will rank pari passu with the liens securing
Company's obligations under the Existing Notes.
On Dec. 6, 2012, GMX Resources accepted consents from the holders
of $288,469,000 in aggregate principal amount of its outstanding
Senior Secured Notes due 2017 in connection with the Consent
Solicitation to execute the Supplemental Indenture, following the
expiration of the Company's previously announced consent
solicitation, which commenced on Nov. 16, 2012, pursuant to which
holders of a majority of the Company's outstanding Existing Notes,
issued pursuant to the Prior Indenture, consented to certain
amendments to the Prior Indenture.
About GMX Resources
GMX Resources Inc. -- http://www.gmxresources.com/-- is an
independent natural gas production company headquartered in
Oklahoma City, Oklahoma. GMXR has 53 producing wells in Texas &
Louisiana, 24 proved developed non-producing reservoirs, 48 proved
undeveloped locations and several hundred other development
locations. GMXR has 9,000 net acres on the Sabine Uplift of East
Texas. GMXR has 7 producing wells in New Mexico. The Company's
strategy is to significantly increase production, revenues and
reinvest in increasing production. GMXR's goal is to grow and
build shareholder value every day.
The Company reported net losses of $206.44 million in 2011,
$138.29 million in 2010, and $181.08 million in 2009.
The Company's balances sheet at Sept. 30, 2012, showed $343.14
million in total assets, $467.64 million in total liabilities and
a $124.49 million total deficit.
* * *
As reported by the TCR on Nov. 23, 2012, Standard & Poor's Ratings
Services raised its corporate credit rating on Oklahoma City-based
GMX Resources Inc. to 'CCC' from 'SD' (selective default).
"The rating on GMX Resources Inc. reflects our assessment of the
company's 'weak' liquidity, 'vulnerable' business risk, and
'highly leveraged' financial risk," said Standard & Poor's credit
analyst Paul Harvey.
GRANITE DELLS: Jan. 9 Hearing on Arizona Eco's Plan Outline
-----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Arizona will convene
a hearing on Jan. 9, 2013, at 1:30 p.m., to consider adequacy of
the disclosure statement explaining the Plan of Reorganization for
Granite Dells Ranch Holding, LLC, et al., as proposed by the Ad
Hoc Committee of Note Holders and Arizona Eco Development LLC.
Objections, if any, are due Jan. 4.
According to the Disclosure Statement, the Plan dated Dec. 4,
2012, proposes that two parcels of real property, a 108-acre
parcel and a 17-acre parcel, all rights and interests related to
the Note Holders' Parcels will be transferred free and clear of
all liens, claims, and encumbrances to a new entity, NH Co. LLC,
which will be owned entirely by the Note Holders, subject only to
certain limitations.
The Note Holder Committee and Arizona Eco have agreed that Arizona
Eco and NH Co. LLC will share the responsibility for any deficit
to pay the Allowed Administrative Claims of the estate, with
Arizona Eco to be responsible to pay 65% of that amount and NH Co.
LLC. to be responsible to pay 35% of that amount, with a cap in
the amount of $450,000 on the amount allocated to be paid by NH
Co. LLC. Arizona Eco has agreed to and will advance the funds
necessary to pay the portion of Allowed Administrative Claims
allocable to NH Co. LLC. Arizona Eco will be repaid the amount it
advances to NH Co. LLC for that purpose from the first proceeds
from the sale of the Note Holders' Parcels, plus interest at the
rate of 8% per annum.
All other property and property interests of the estate are to be
transferred or foreclosed upon by Arizona Eco, except that suits
and claims held or owned by the Estate against any member of the
Cavan Group will be transferred to and may be pursued by Arizona
Eco or its nominee, with any net recoveries to be paid 80% to
Arizona Eco and 20% to NH Co. LLC.
All other General Unsecured Claims will be paid 10% of their
principal amount if or when allowed by a final order of the court,
and claims will be paid when finally allowed; however, Arizona Eco
agrees as part of the proposed Joint Plan to not assert any
unsecured deficiency claim in the General Unsecured Class, except
as a set-off against any Claim held by any member of the Cavan
Group.
The equity interests are terminated under the Joint Plan and do
not receive payment.
About Granite Dells
Scottsdale, Arizona-based Granite Dells Ranch Holdings LLC filed a
bare-bones Chapter 11 petition (Bankr. D. Ariz. Case No. 12-04962)
in Phoenix on March 13, 2012. Judge Redfield T. Baum PCT Sr.
oversees the case. The Debtor is represented by Alan A. Meda,
Esq., at Stinson Morrison Hecker LLP. The Debtor disclosed
$2.22 million in assets and $157 million in liabilities as of the
Chapter 11 filing.
Cavan Management Services, LLC is the Debtor's manager. David
Cavan, member of the firm, signed the Chapter 11 petition.
Arizona ECO Development LLC, which acquired a $83.2 million 2006
loan by the Debtor, is represented by Snell & Wilmer L.L.P. The
resolution authorizing the Debtor's bankruptcy filing says the
Company is commencing legal actions against Stuart Swanson, AED,
and related entities relating to the purchase by Mr. Swanson of a
promissory note payable by the Company to the parties that sold a
certain property to the Company. According to Law 360, AED sued
Granite Dells on March 6 asking the Arizona court to appoint a
receiver. Arizona ECO is foreclosing on a secured loan backed by
15,000 acres of Arizona land.
The United States Trustee said that an official committee has not
been appointed in the bankruptcy case of Granite Dells because an
insufficient number of unsecured creditors have expressed interest
in serving on a committee.
The Debtor's Plan provides for payment to unsecured creditors
(including any unsecured claim of AED) in quarterly installments
over eight years aggregating $5 million. However, the Plan
provides that a holder of an investment promissory note (estimated
to total $21 million) will be given the option of participating in
the funding of the Reorganized Debtor.
Tri-City Investment & Development, LLC, a 39.25% equity holder in
the Debtor, also filed a Consolidated Supplemental Disclosure in
support of Tri-City's Plan, as amended. Tri-City's consolidated
Disclosure Statement incorporates and restates all material terms
of the Tri-City's previous disclosure statements and incorporates
the terms of the agreement that was reached at the Aug. 20, 2012,
mediation.
GULFPORT ENERGY: Moody's Rates $50-Mil. Sr. Unsecured Notes 'B3'
----------------------------------------------------------------
Moody's Investors Service assigned a B3 rating to Gulfport Energy
Corporation proposed $50 million senior unsecured notes. This
issuance is an add-on to the 7.75% $250 million 2020 notes that
were issued in October, 2012. Gulfport's other ratings and stable
outlook were unchanged.
Net proceeds from this offering will be used for general corporate
purposes including funding for future capex.
Issuer: Gulfport Energy Corporation
Assignments:
US$50M Senior Unsecured Regular Bond/Debenture, Assigned B3
US$50M Senior Unsecured Regular Bond/Debenture, Assigned a
range of LGD4, 58 %
Ratings Rationale
The new notes will have identical terms and conditions as the
original $250 million unsecured notes and will be treated as a
single class of debt under the same indenture. Therefore, the new
and the original notes are both rated at the same B3 level.
Moody's overrode the Moody's Loss Given Default Methodology
generated rating given the likelihood of higher than average
recovery in a default scenario because of Gulfport's substantial
underlying alternate liquidity. However, the notes could get
notched down from the CFR (to Caa1) if the size of the priority
claim borrowing base revolver increases significantly in the
future. Both the notes and the credit facility will have upstream
guarantee from all of Gulfport's current and future restricted
subsidiaries other than Grizzly Holdings, Inc. (an unrestricted
subsidiary) that holds Gulfport's oil sands interests in Alberta.
The B3 Corporate Family Rating (CFR) reflects Gulfport's limited
production base, very short reserve life in relation to proved
developed (PD) reserves, high capital requirements through 2014,
and significant development and execution risks surrounding its
aggressive drilling program in the emerging Utica Shale play. The
B3 rating is supported by Gulfport's oil-weighted production
profile anchored in the Louisiana Gulf Coast, which has long
production history and produces significant free cash flow at
today's oil prices, solid organic growth prospects in the Utica
and good liquidity.
The stable outlook assumes Gulfport will manage its growth without
meaningfully depleting liquidity.
Successful execution of the Utica drilling program leading to
higher production and reserves will dictate upward rating
progression. An upgrade would be considered if production can be
sustained above 20,000 boe/d alongside a retained cash flow to
debt ratio of at least 40%.
A downgrade could occur if the company acquires additional non-
producing properties using debt, and/or significantly ramps up
capital spending prior to achieving its production targets. If the
debt to average daily production ratio rises above 35,000 boe/d or
liquidity appears inadequate, a prompt downgrade is likely.
The principal methodology used in rating Gulfport was the Global
Independent Exploration and Production Industry Methodology
published in December 2011. Other methodologies used include Loss
Given Default for Speculative-Grade Non-Financial Companies in the
U.S., Canada and EMEA published in June 2009.
Based in Oklahoma City, Oklahoma, Gulfport Energy Corporation is
an independent E&P company with principal producing properties
located in the Louisiana Gulf Coast and the Utica Shale in Eastern
Ohio.
GULFPORT ENERGY: S&P Keeps 'CCC+' Rating on $300MM Unsecured Notes
------------------------------------------------------------------
Standard & Poor's Ratings Services said that its 'B-' corporate
credit rating and 'CCC+' issue-level rating on Gulfport Energy
Corp. are unchanged by Gulfport's announcement that it will issue
9,000,000 shares of common stock and launch a $50 million add-on
to its 7.75% senior notes due 2020. Net proceeds from the equity
offering and the add-on will be used primarily to fund the
acquisition of approximately 30,000 net acres in the Utica Shale
from Windsor Ohio LLC for about $300 million.
RATINGS LIST
Gulfport Energy Corp.
Corporate credit rating B-/Negative/--
$300 mil. 7.75% sr unsec notes due 2020 CCC+
Recovery rating 5
HAWKER BEECHCRAFT: Approved to Satisfy Exit Facility Obligations
----------------------------------------------------------------
The Hon. Stuart M. Bernstein of the U.S. Bankruptcy Court for the
Southern District of New York authorized Hawker Beechcraft, Inc.,
et al., to satisfy certain exit facility obligations.
The Court also ordered that the Debtors are authorized to, among
other things:
-- pay the work fees and reimburse the work expenses incurred
by the potential lenders; provided, that, the aggregate amount of
work fees and expenses will not exceed the amount of the work fees
and expenses cap; provided further, that, the Debtors consult
with the committee prior to paying the work fees and expenses or
by further order of the Court.
-- indemnify, defend and hold harmless the potential lenders,
their affiliates and each of their officers, directors, employees,
agents, advisors, attorneys and representatives in connection with
the exit facility efforts, except in the case of gross negligence,
bad faith or willful misconduct of such indemnified persons.
-- file a copy of the work fees and expenses cap exhibit under
seal. The work fees and expenses cap exhibit will remain under
seal and confidential and, with the exception of the work fees and
expenses cap notice parties, will not be made available to anyone
without the written consent of the Debtors or by further order of
the Court.
About Hawker Beechcraft
Hawker Beechcraft Acquisition Company, LLC, headquartered in
Wichita, Kansas, manufactures business jets, turboprops and piston
aircraft for corporations, governments and individuals worldwide.
Hawker Beechcraft reported a net loss of $631.90 million on
$2.43 billion of sales in 2011, compared with a net loss of
$304.30 million on $2.80 billion of sales in 2010.
Hawker Beechcraft Inc. and 17 affiliates filed for Chapter 11
reorganization (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 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. The Committee's
financial advisor is FTI Consulting, Inc.
On June 30, 2012, Hawker filed its Plan, which proposed to
eliminate $2.5 billion in debt and $125 million of annual cash
interest expense. The plan would 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.
In July 2012, Hawker disclosed it was in exclusive talks with
China's Superior Aviation Beijing Co. for the purchase of Hawker's
corporate jet and propeller plane operations out of bankruptcy for
$1.79 billion.
In October 2012, Hawker unveiled that those talks have collapsed
amid concerns a deal with Superior wouldn't pass muster with a
U.S. government panel and other cross-cultural complications.
Sources told The Wall Street Journal that Superior encountered
difficulties separating Hawker's defense business from those units
in a way that would make both sides comfortable the deal would get
U.S. government clearance. The sources told WJS the defense
operations were integrated in various ways with Hawker's civilian
businesses, especially the propeller plane unit, in ways that
proved difficult to untangle.
Thereafter, Hawker said it intends to emerge from bankruptcy as an
independent company. On Oct. 29, 2012, Hawker filed a modified
reorganization plan and disclosure materials. Hawker said the
plan was supported by the official creditors' committee and by a
"substantial majority" of holders of the senior credit and a
majority of holders of senior notes. Hawker said it will either
sell or close the jet-manufacturing business.
The revised plan still offers 81.9% of the new stock in return for
$921 million of the $1.83 billion owing on the senior credit.
Unsecured creditors are to receive the remaining 18.9% of the new
stock. Holders of the senior credit will receive 86% of the new
stock. The senior credit holders are projected to have a 43.1%
recovery from the plan. General unsecured creditors' recovery is
a projected 5.7% to 6.3%. The recovery by holders of $510 million
in senior notes is predicted to be 9.2% to 10%.
HOSTESS BRANDS: Bakers Union Vows to Appeal Wind-Down Order
-----------------------------------------------------------
Lisa Uhlman at Bankruptcy Law360 reports that Hostess Brands
Inc.'s bakers union, whose weeklong strike in November prompted
the Twinkies maker's decision to begin winding down its
operations, said Friday it would appeal a New York bankruptcy
judge's order approving that plan.
According to Bankruptcy Law360, the Bakery, Confectionery, Tobacco
Workers and Grain Millers International Union and a related
pension fund filed a notice of appeal from U.S. Bankruptcy Judge
Robert D. Drain's Nov. 30 order approving Hostess' plan to wind
down its businesses and sell off its assets.
About Hostess Brands
Founded in 1930, Irving, Texas-based Hostess Brands Inc., is known
for iconic brands such as Butternut, Ding Dongs, Dolly Madison,
Drake's, Home Pride, Ho Hos, Hostess, Merita, Nature's Pride,
Twinkies and Wonder. Hostess has 36 bakeries, 565 distribution
centers and 570 outlets in 49 states.
Hostess filed for Chapter 11 bankruptcy protection early morning
on Jan. 11, 2011 (Bankr. S.D.N.Y. Case Nos. 12-22051 through
12-22056) in White Plains, New York. DHostess Brands disclosed
assets of $982 million and liabilities of $1.43 billion as of the
Chapter 11 filing.
The bankruptcy filing was made two years after predecessors
Interstate Bakeries Corp. and its affiliates emerged from
bankruptcy (Bankr. W.D. Mo. Case No. 04-45814).
In the new Chapter 11 case, Hostess has hired Jones Day as
bankruptcy counsel; Stinson Morrison Hecker LLP as general
corporate counsel and conflicts counsel; Perella Weinberg Partners
LP as investment bankers, FTI Consulting, Inc. to provide an
interim treasurer and additional personnel for the Debtors, and
Kurtzman Carson Consultants LLC as administrative agent.
Matthew Feldman, Esq., at Willkie Farr & Gallagher, and Harry
Wilson, the head of turnaround and restructuring firm MAEVA
Advisors, are representing the Teamsters union.
Attorneys for The Bakery, Confectionery, Tobacco Workers and Grain
Millers International Union and Bakery & Confectionery Union &
Industry International Pension Fund are Jeffrey R. Freund, Esq.,
at Bredhoff & Kaiser, P.L.L.C.; and Ancela R. Nastasi, Esq., David
A. Rosenzweig, Esq., and Camisha L. Simmons, Esq., at Fulbright &
Jaworski L.L.P.
The official committee of unsecured creditors selected New York
law firm Kramer Levin Naftalis & Frankel LLP as its counsel. Tom
Mayer and Ken Eckstein head the legal team for the committee.
Hostess Brands in mid-November opted to pursue the orderly wind
down of its business and sale of its assets after the Bakery,
Confectionery, Tobacco and Grain Millers Union (BCTGM) commenced a
nationwide strike. The Debtor failed to reach an agreement with
BCTGM on contract changes. Hostess Brands said it intends to
retain approximately 3,200 employees to assist with the initial
phase of the wind down. Employee headcount is expected to decrease
by 94% within the first 16 weeks of the wind down. The entire
process is expected to be completed in one year.
The bankruptcy judge signed a formal order on Nov. 30 giving final
approval to wind-down procedures. The latest budget projects the
$49 million loan for the Chapter 11 case being paid down to
$21.2 million by Feb. 22.
IMAGENETIX INC: Files for Chapter 11 Protection
-----------------------------------------------
BankruptcyData.com reports that Imagenetix, Inc., filed for
Chapter 11 protection (Bankr. S.D. Calif. Case No. 12-16423) in
San Diego, California. The Company is represented by Robert E.
Opera of Winthrop Couchot Professional Corporation.
San Diego-based Imagenetix develops, formulates and markets over-
the-counter, natural-based nutritional supplements and skin care
products.
INERGETICS INC: Transfer of $2.2-Mil. NJ Tax Benefits Okayed
------------------------------------------------------------
Millennium Biotechnologies, Inc., a wholly-owned subsidiary of
Inergetics, Inc., was notified by the New Jersey Economic
Development Authority that the Company has been preliminarily
approved for the Technology Business Tax Certificate Transfer
Program. The Company has been preliminarily approved for State
Fiscal Year 2013 to transfer $2,209,715 of total available New
Jersey State tax benefits of $5,187,471. A copy of the letter is
available for free at http://is.gd/x9Erxu
Paramus, N.J.-based Inergetics, Inc., formerly Millennium
Biotechnologies Group, Inc., is a holding company for its
subsidiary Millennium Biotechnologies, Inc. Millennium is a
research based bio-nutraceutical corporation involved in the field
of nutritional science. Millennium's principal source of revenue
is from sales of its nutraceutical supplements, Resurgex Select(R)
and Resurgex Essential(TM) and Resurgex Essential Plus(TM) which
serve as a nutritional support for immuno-compromised individuals
undergoing medical treatment for chronic debilitating diseases.
Millennium has developed Surgex for the sport nutritional market.
The Company's efforts going forward will focus on sales of Surgex
in powder, bar and ready to drink forms.
The Company's balance sheet at Sept. 30, 2012, showed $1.11
million in total assets, $6.99 million in total liabilities, and a
$5.88 million total stockholders' deficit.
"However, the Company has a working capital deficit, significant
debt outstanding, incurred substantial net losses for the nine
months ended September 30, 2012 and 2011 and has accumulated a
deficit of approximately $81 million at September 30, 2012. The
Company has not been able to generate sufficient cash from
operating activities to fund its ongoing operations. There is no
guarantee that the Company will be able to generate enough revenue
and/or raise capital to support its operations in the future.
These factors raise substantial doubt about the Company's ability
to continue as a going concern," according to the Company's
quarterly report for the period ended Sept. 30, 2012.
INTERNATIONAL FUEL: Five Directors Elected to Board
---------------------------------------------------
International Fuel Technology, Inc., held its annual meeting of
stockholders on Dec. 4, 2012. At this meeting, the following
directors were elected to the Company's Board of Directors:
Jonathan R. Burst, Rex Carr, Michael Gianino, Gary Kirk and David
B. Norris. All directors will serve until the Company's next
annual meeting and until their successors will have been duly
qualified and elected.
The stockholders also ratified the appointment of independent
registered public accounting firm, BDO USA, LLP, for the fiscal
year ending Dec. 31, 2012.
About International Fuel
St. Louis, Mo.-based International Fuel Technology, Inc., is a
technology company that has developed a range of liquid fuel
additive formulations that enhance the performance of petroleum-
based fuels and renewable liquid fuels.
BDO USA, LLP, in Chicago, Illinois, issued a "going concern"
qualification on the consolidated financial statements for the
year ended Dec. 31, 2011, citing recurring losses from operations,
working capital and stockholders' deficits and cash obligations
and outflows from operating activities that raise substantial
doubt about its ability to continue as a going concern.
The Company reported a net loss of $2.57 million in 2011, compared
with a net loss of $2.21 million in 2010.
The Company's balance sheet at Sept. 30, 2012, showed $2.45
million in total assets, $4.74 million in total liabilities and a
$2.28 million total stockholders' deficit.
JHK INVESTMENT: Can Hire Zeisler & Zeisler as Counsel
-----------------------------------------------------
JHK Investments LLC sought and obtained permission from the U.S.
Bankruptcy Court to employ of Zeisler & Zeisler, P.C. as its
counsel.
Prior to the Chapter 11 filing, Z&Z received a $50,000 retainer
from the Debtor and non-Debtor funds, which was applied on account
of legal fees and expenses incurred in representing the Debtor
prior to the bankruptcy filing, and in contemplation of and in
connection with the Chapter 11 case.
The Debtor attests that the firm is a "disinterested person" as
the term is defined in Section 101(14) of the Bankruptcy Code.
JHK Investments, LLC, filed a Chapter 11 petition (Bankr. D. Conn.
Case No. 12-51608) in Bridgeport, Conn., on Aug. 29, estimating
under $100 million in assets and more than $10 million in
liabilities. Craig I. Lifland, Esq., at Zeisler & Zeisler, P.C.,
represents the Debtor.
Westport, Connecticut-based JHK is an investment company founded
by the former senior management team of United States Surgical
Corporation. Founded by Leon C. Hirsch in 1963, USSC became a
global medical device manufacturer with sales exceeding
$1.2 billion and employing $4,000 Connecticut residents.
Following the success of USSC, Mr. Hirsch and two other senior
USSC executives created JHK in order to produce and develop new
markets and penetrate established markets throughout the world for
high-tech medical devices. JHK owns equity in several start-up
medical subsidiaries. The start-ups include Interventional
Therapies, LLC, Auditory Licensing Company, LLC, Biowave
Corporation, Gorham Enterprises, LLC, and American Bicycle Group,
LLC.
Bay City claims to be owed $31 million for funding provided to the
Debtor since January 2011. The principals at JHK -- Mr. Hirsch,
Turi Josefsen, and Robert A. Knarr -- guaranteed JHK's
obligations, pledged the property in Wilton, Connecticut to secure
obligations under the guaranty, and pledged all equity interests
of JHK.
In March 2012, Eleuthera, in its capacity as administrative agent
for Bay City, declared an event of default as a result of the
passage of the maturity date and the failure to pay the entire
amount outstanding. On Aug. 28, 2012, Bay City and Eleuthera
purported to exercise the pledge agreements insofar as they
purported to register the Principals' interest in JHK in the name
of Eleuthera, as nominee for Bay City, and purported to reserve
their right to exercise voting rights in JHK.
K-V PHARMACEUTICAL: Susquehanna Affiliate Has Better Loan Option
----------------------------------------------------------------
Patrick Fitzgerald at Daily Bankruptcy Review reports that an
investment affiliate of Susquehanna International Group is balking
at Silver Point Capital's loan to bankrupt drug maker K-V
Pharmaceutical Co., saying it has a "far superior financing
option" on the table.
About K-V Pharmaceutical
K-V Pharmaceutical Company (NYSE: KVa/KVb) --
http://www.kvpharmaceutical.com/-- is a fully integrated
specialty pharmaceutical company that develops, manufactures,
markets, and acquires technology-distinguished branded and
generic/non-branded prescription pharmaceutical products. The
Company markets its technology distinguished products through
ETHEX Corporation, a subsidiary that competes with branded
products, and Ther-Rx Corporation, the company's branded drug
subsidiary.
K-V Pharmaceutical Company and certain domestic subsidiaries on
Aug. 4, 2012, filed voluntary Chapter 11 petitions (Bankr.
S.D.N.Y. Lead Case No. 12-13346, under K-V Discovery Solutions
Inc.) to restructure their financial obligations.
K-V employed Willkie Farr & Gallagher LLP as bankruptcy counsel,
Williams & Connolly LLP as special litigation counsel, and SNR
Denton as special litigation counsel. In addition, K-V tapped
Jefferies & Co., Inc., as financial advisor and investment banker.
Epiq Bankruptcy Solutions LLC is the claims and notice agent.
The U.S. Trustee appointed five members to serve in the Official
Committee of Unsecured Creditors. Kristopher M. Hansen, Esq.,
Erez E. Gilad, Esq., and Matthew G. Garofalo, Esq., at Stroock &
Stroock & Lavan LLP, represent the Creditors Committee.
Weil, Gotshal & Manges LLP's Robert J. Lemons, Esq., and Lori R.
Fife, Esq., represent an Ad Hoc Senior Noteholders Group.
K-V PHARMACEUTICAL: Inks $60MM Settlement Agreement With Hologic
----------------------------------------------------------------
K-V Pharmaceutical Company and certain of its wholly-owned
domestic subsidiaries entered into a Settlement Agreement and
Release with Hologic, Inc., and Cytyc Prenatal Products Corp.
Pursuant to the Settlement Agreement, among other things, Hologic
and the Debtors have agreed to stay all claims, litigation and
disputes between the parties, Hologic has agreed not to file any
new objections in the Bankruptcy Court or transfer any of its
claims against the Debtors to third parties, and, upon
satisfaction of the conditions of settlement including the payment
of $60 million to Hologic, Hologic and the Debtors have agreed to
release all claims between the parties.
Hologic has asserted various claims against the Debtors and
asserted various objections to relief sought by the Debtors in the
Bankruptcy Cases. Hologic filed objections to the Debtors' motion
to continue using their existing cash management system and to
continue to use pre-petition practices with respect to
intercompany transactions.
Hologic has also filed a motion for relief from the automatic stay
of Section 362 of the Bankruptcy Code with respect to its claims
related to the worldwide rights to pharmaceutical product Makena
and certain other assets, which, the Company agreed to purchase
from Hologic pursuant to a certain Asset Purchase Agreement, dated
Jan. 16, 2008. In its motion, Hologic claimed, among other
things, that the value of its interests in the Makena Assets is
subject to decline and that those interests are not adequately
protected. The Debtors filed an objection to Hologic's motion and
have been vigorously defending their position. Additionally,
Hologic filed a proof of claim in the Bankruptcy Cases asserting a
secured claim against the Company in the amount of $95 million
plus certain royalties allegedly owed to Hologic under the Asset
Purchase Agreement. The Debtors dispute the amounts owed and the
collateral claimed by Hologic.
Consummation of the Settlement Agreement is dependent upon a
number of conditions, including, the Debtors obtaining a debtor in
possession financing facility and Hologic being paid in full on or
prior to Dec. 31, 2012. If the Bankruptcy Court approves the
Settlement Agreement and the DIP Facility, and Hologic is paid,
all of Hologic's claims against the Debtors, and all of the
Debtors claims against Hologic, in each case, will be released and
all those claims will be fully satisfied and discharged.
The Settlement Agreement will be deemed terminated upon the
occurrence of any of the following: (a) the Bankruptcy Court does
not approve the Settlement Agreement; (b) the Debtors fail to
enter into the DIP Facility; (c) the Bankruptcy Court does not
approve the Debtors' entry into the DIP Facility; (d) the
Bankruptcy Court does not approve the Settlement Agreement and the
funding of the Settlement Payment to Hologic; or (e) the Debtors
fail to make the Settlement Payment on or prior to December 31,
2012.
A copy of the Settlement Agreement is available for free at:
http://is.gd/T9cWM2
About K-V Pharmaceutical
K-V Pharmaceutical Company (NYSE: KVa/KVb) --
http://www.kvpharmaceutical.com/-- is a fully integrated
specialty pharmaceutical company that develops, manufactures,
markets, and acquires technology-distinguished branded and
generic/non-branded prescription pharmaceutical products. The
Company markets its technology distinguished products through
ETHEX Corporation, a subsidiary that competes with branded
products, and Ther-Rx Corporation, the company's branded drug
subsidiary.
K-V Pharmaceutical Company and certain domestic subsidiaries on
Aug. 4 filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y. Lead
Case No. 12-13346, under K-V Discovery Solutions Inc.) to
restructure their financial obligations.
K-V has retained the services of Willkie Farr & Gallagher LLP as
bankruptcy counsel, Williams & Connolly LLP as special litigation
counsel, and SNR Denton as special litigation counsel. In
addition, K-V has retained Jefferies & Co., Inc., as financial
advisor and investment banker. Epiq Bankruptcy Solutions LLC is
the claims and notice agent.
The U.S. Trustee appointed five members to serve in the Official
Committee of Unsecured Creditors.
K-V's main business now is the sale of Makena, a drug reducing the
risk of premature birth. Hologic Inc. sold the Makena business to
K-V in 2008 and is owed about $95 million plus royalties. Hologic
has a lien on the right to distribute the product to recover the
remaining payments. Hologic wants the bankruptcy judge to grant
permission to foreclose rights to Makena.
K-V is operating with use of cash representing collateral for
$225 million in senior notes.
KINDERHOOK PARTNERS: IDQ Buyout No Impact on Moody's 'B3' CFR
-------------------------------------------------------------
Moody's Investors Service said that Kinderhook Partners LLC's
planned buyout of IDQ Holdings, Inc. from current private equity
sponsor Castle Harlan, Inc for approximately $305 million does not
impact IDQ's ratings and stable outlook.
KIRCH GROUP: German Court Orders Deutsche Bank to Pay Damages
-------------------------------------------------------------
Stewart Bishop at Bankruptcy Law360 reports that a German court on
Friday reportedly held that Deutsche Bank AG must pay damages to
the heirs of deceased media mogul Leo Kirch after the bank's
onetime CEO was accused of triggering the collapse of Kirch's
conglomerate.
Bankruptcy Law360 relates that the Munich Higher Regional Court
found the lender is liable for damages resulting from a television
interview during which former CEO Rolf Breuer challenged the
creditworthiness of Kirch Group, according to Die Zeit.
As reported in the Troubled Company Reporter on Feb. 16, 2012,
Dow Jones' Daily Bankruptcy Review reports that Deutsche Bank AG
is closing in on an agreement to pay about EUR800 million
(US$1 billion) to settle decade-old claims that a former chief
executive helped drive German media company Kirch Group into
bankruptcy, according to people familiar with the negotiations.
KirchGruppe succumbed to bankruptcy in 2002 due to a debt
pile of about EUR5 billion.
LA JOLLA: Stockholders Waive 12-Month Redemption Rights
-------------------------------------------------------
La Jolla Pharmaceutical Company entered into a Consent and Waiver
Agreement with certain holders of the Company's preferred stock
pursuant to which the Holders irrevocably waived their right to
effect a 12-Month Redemption such that Article IV(d)(6)(C) of the
Charter no longer has any force or effect. The Holders also
irrevocably waived the protections set forth in Articles
IV(d)(11)(I) and IV(d)(12) of the Charter and consented to any
past and future corporate actions that may cause the Company's net
cash to fall below $2,900,000. By virtue of that consent and
waiver, the provisions of Articles IV(d)(11)(I) and IV(d)(12) of
the Charter no longer have any force or effect.
About La Jolla Pharmaceutical
San Diego, Calif.-based La Jolla Pharmaceutical Company (OTC BB:
LJPC) -- http://www.ljpc.com/-- is a biopharmaceutical company
that has historically focused on the development and testing of
Riquent as a treatment for Lupus nephritis.
La Jolla reported a net loss of $11.54 million in 2011, compared
with a net loss of $3.76 million in 2010.
The Company's balance sheet at Sept. 30, 2012, showed
$3.40 million in total assets, $12.93 million in total
liabilities, all current, $5.80 million in Series C-1 redeemable
convertible preferred stock, and a $15.33 million total
stockholders' deficit.
After auditing the 2011 results, BDO USA, LLP, in San Diego,
California, expressed substantial doubt about the Company's
ability to continue as a going concern. The independent auditors
noted that the Company has suffered recurring losses from
operations, has an accumulated deficit of $439.6 million and a
stockholders' deficit of $15.6 million as of Dec. 31, 2011, and
has no current source of revenues.
LANDRY'S HOLDINGS: Moody's Rates $210MM Sr. Unsec. Notes 'Caa1'
---------------------------------------------------------------
Moody's Investors Service assigned a Caa1 (LGD 6, 94%) rating to
Landry's Holdings II, Inc.'s (Landry's Holdings II) proposed $210
million senior unsecured notes due 2018. In addition, Moody's
affirmed all ratings of Landry's Inc. (Landry's) $1.2 billion bank
credit facility at B1 (LGD 3, 34%) and $425 million senior
unsecured notes due 2020 rated Caa1 (LGD 5, 87%). The B2 Corporate
Family Rating and Probability of Default Rating of Landry's were
affirmed. The outlook is stable.
Ratings Rationale
Landry's Holdings II is a newly formed holding company -- with no
assets or operations of its own -- and the parent company of
Landry's. Proceeds from the proposed new note offering will be
used to fund a dividend to Landry's Holdings Inc., the parent
company of Landry's Holdings II, which will use the proceeds for
general corporate purposes. Landry's will not guarantee the
proposed new notes nor will it be directly liable for these notes,
including the servicing of interest or refinancing at maturity.
However, given Landry's Holdings II's inability to service the
notes on its own it will have to rely on distributions from
Landry's to pay regular interest on the notes.
Despite the increase in debt to fund the proposed dividend the
affirmation of existing ratings and outlook at Landry's reflects
Moody's view that Landry's earnings and debt protection metrics
will improve as management focuses on integrating recent
acquisitions and reducing overall costs. The stable outlook
acknowledges that although credit metrics will be weaker than
originally believed due to the new proposed note offering, Moody's
still expects improvement over the intermediate term as a full
year of earnings from recent acquisitions and cost saving
initiatives are fully realized. However, the stability of the
outlook would be negatively impacted in the event cash flow fell
short of Moody's current expectations, due in part to dividends or
other shareholder based initiatives. The outlook would also be
negatively impacted if liquidity deteriorated from current levels.
The B2 Corporate Family Rating reflects the company's high
leverage and modest coverage as well as soft consumer spending
environment that will continue to pressure earnings and aggressive
financial policies. The ratings also reflect the company's
adequate liquidity, material scale, and the solid brand value of
its various restaurant concepts.
Upon successful completion of the transaction and receipt and
review of final documentation the B2 Corporate Family and
Probability of Default rating will be withdrawn from Landry's Inc.
and assigned to Landry's Holdings II with a stable outlook.
Moreover, the B1 rating on Landry's $1.0 billion senior secured
term loan and $200 million senior secured revolver would likely be
upgraded to Ba3 (LGD 3, 30%) per Moody's Loss Given Default model
upon successful completion of the transaction and the expectation
that operating performance continues to improve. It is also
Moody's understanding that the financial statements of Landry's
Holdings II, Inc. will be audited on an annual basis.
Ratings assigned are:
Landry's Holdings II, Inc.
$210 million senior unsecured notes, due 2018 at Caa1 (LGD 6,
94%)
Ratings affirmed are:
Landry's Inc.
$200 million guaranteed senior secured revolver due 2017, rated
B1 (LGD 3, 34%)
$1.0 billion guaranteed senior secured term loan B due 2017,
rated B1 (LGD 3, 34%)
$425 million guaranteed senior unsecured notes due 2020, rated
Caa1 (LGD 5, 87%)
Given higher than expected debt levels and persistently soft
consumer spending a higher rating over the intermediate term is
unlikely. However, factors that could result in an upgrade include
a sustained improvement in earnings driven by positive operating
trends and lower costs. Specifically, an upgrade would require
debt to EBITDA below 4.5 times and EBITA coverage of interest
above 2.0 times. A higher rating would also require a more
moderate financial policy towards dividends and acquisitions as
well as maintaining good liquidity.
Factors that could result in a downgrade include a deterioration
in operating performance or an inability to continuously reduce
financial leverage below 6.0 times and improve coverage.
Specifically, a downgrade could occur if debt to EBITDA exceeded
6.0 times or EBITA to interest fell below 1.5 times on a sustained
basis.
The principal methodology used in rating Landry's was the Global
Restaurant Industry Methodology published in June 2011. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
Landry's Inc. owns and operates mostly casual dining restaurants
under the trade names Landry's Seafood House, Chart House,
Saltgrass Steak House, Rainforest Cafe, Bubba Gump, and McCormick
& Schmicks, and Morton's Restaurants, Inc. Landry's Inc. also owns
and operates the Golden Nugget hotel and casino in Las Vegas,
Nevada. Annual revenue of the restaurant group is approximately
$2.0 billion.
LANDRY'S HOLDINGS: S&P Rates $210MM Unsecured Notes 'CCC+'
----------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'CCC+' issue-level
and '6' recovery rating to the proposed $210 million of unsecured
notes due 2018 to be issued by Landry's Holdings II Inc. "We
included this debt under the parent, Houston-based retailer
Landry's Inc. The '6' recovery rating indicates our expectation of
negligible (0% to 10%) recovery for noteholders in the event of a
hypothetical payment default. Proceeds are to be used to fund a
distribution to the parent company. All other ratings, including
the 'B' corporate credit rating, are unaffected by this
transaction. As a result of the transaction, we expect adjusted
leverage of nearly 5.9x of interest coverage of about 2x," S&P
said.
"The corporate credit rating on Landry's is 'B' and the rating
outlook is stable. The 'B' rating continues to reflect our view of
Landry's financial risk profile as 'highly leveraged'. In our
base-case forecast that incorporates 2% same-store sales and debt
reduction with about half of excess cash flows, we see leverage
declining to the mid-5x area and funds from operations to debt of
10%, which are in line with levels indicative of the 'B' rating,"
S&P said.
RATINGS LIST
Landry's Inc.
Corporate Credit Rating B/Stable/--
Rating Assigned
Landry's Holdings II Inc.
$210 Mil. Unsecured Notes Due 2018 CCC+
Recovery Rating 6
LCI HOLDING: Hires KPMG LLP for Audit and Tax Consulting Matters
----------------------------------------------------------------
LCI Holding Company Inc., and its affiliates seek approval from
the Bankruptcy Court to employ KPMG LLP as service provider for
audit, tax compliance and tax consulting matters, nunc pro tunc to
the Chapter 11 petition date.
For audit services, which include an audit of the financial
statements and schedules of the Debtors, the majority of fees to
be charged reflect a reduction of 30% to 50% from KPMG's normal
and customary rates:
Audit Services Discounted Rate
-------------- ---------------
Partners $450 to $500
Senior Managers/Managers $375 to $425
Senior Associates $225 to $275
Associates $125 to $175
For tax compliance and consulting services, which include the
preparation of federal and state corporate tax returns and
schedules, the majority of fees will have a reduction of 20% to
25% of the firm's normal rates:
Tax Compliance Services Discounted Rate
----------------------- ---------------
Partners $695
Senior Managers $580
Managers $470
Senior Associates $320
Associates $260
Tax Consulting Services Discounted Rate
----------------------- ---------------
Partners/Directors $695 to $840
Senior Managers $580 to $740
Managers $470 to $660
Senior Associates $320 to $480
Associates $260 to $320
KPMG will also seek reimbursement for reasonable and necessary
expenses.
KPMG is a "disinterested person" within the meaning of Section
101(14) ofthe Bankruptcy Code.
About LifeCare
LCI Holding Inc. and its affiliates, doing business as LifeCare
Hospitals, operate eight "hospital within hospital" facilities and
19 freestanding facilities in 10 states. The hospitals have about
1,400 beds at facilities in Louisiana, Texas, Pennsylvania, Ohio
and Nevada. LifeCare is controlled by Carlyle Group, which holds
93.4 percent of the stock following a $570 million acquisition in
August 2005.
LifeCare Holdings and its affiliates, including LifeCare Holdings
Inc., sought Chapter 11 protection (Bankr. D. Del. Lead Case No.
12-13319) on Dec. 11, 2012, with plans to sell assets to secured
lenders.
Ken Ziman, Esq., and Felicia Perlman, Esq., at Skadden, Arps,
Slate Meagher & Flom LLP, serve as counsel to the Debtors.
Rothschild Inc. is the financial advisor.
The steering committee of lenders is represented by attorneys at
Akin Gump Strauss Hauer & Feld LLP and Blank Rome LLP. The agent
under the prepetition and postpetition secured credit facility is
represented by Simpson Thacher & Barlett LLP.
The Debtors disclosed assets of $422 million and liabilities
totaling $575.9 million as of Sept. 30, 2012. As of the
bankruptcy filing, total long-term obligations were $482.2 million
consisting of, among other things, institutional loans and
unsecured subordinated loans. A total of $353.4 million is owing
under the prepetition secured credit facility. A total of
$128.4 million is owing on senior subordinated notes.
LCI HOLDING: Proposes Rothschild as Investment Banker
-----------------------------------------------------
LCI Holding Company Inc. and its affiliates seek to employ
Rothschild Inc. as financial advisor and investment banker, nunc
pro tunc to the Petition Date.
Among other things, the Debtors require Rothschild's services in
connection with a possible restructuring of their existing
obligations, possible new financing and/or a potential sale or
other disposition of the assets.
The Debtors have agreed to pay Rothschild the compensation set
forth in the engagement letter, which provides:
* Monthly Fee: $200 per month from July 2012 through December
2012; thereafter, $150,000.
* Completion Fee: $3,425,000 upon confirmation and
effectiveness of a Plan or closing of another Transaction.
* M&A Fee: a percentage of the aggregate consideration but not
less than $1,000,000 upon closing of an M&A transaction.
* New Capital Fee: 1.0% of senior secured debt raised; 2% of
junior secured debt; 2% of unsecured debt; 3% of equity and
similar capital raised.
The term "Transaction" is defined as any one or more of: (a) any
transaction or series of transactions resulting in a
restructuring, reorganization, refinancing with respect to a
material portion of the company's indebtedness, (b) any merger or
reorganization pursuant to which the Company is acquired by
another entity; (c) any acquisition of a material portion of the
assets or equity interests; or (d) any transaction similar in
nature.
The Debtors will reimburse Rothschild for its reasonable expenses
incurred in connection with the performance of the engagement.
During the 90 days preceding the Petition Date, Rothschild
received fee payments totaling $800,000 and reimbursements
totaling $142,000. As of the Petition Date, the Debtors did not
owe Rothschild any fees or expenses incurred prepetition.
About LifeCare
LCI Holding Inc. and its affiliates, doing business as LifeCare
Hospitals, operate eight "hospital within hospital" facilities and
19 freestanding facilities in 10 states. The hospitals have about
1,400 beds at facilities in Louisiana, Texas, Pennsylvania, Ohio
and Nevada. LifeCare is controlled by Carlyle Group, which holds
93.4 percent of the stock following a $570 million acquisition in
August 2005.
LifeCare Holdings and its affiliates, including LifeCare Holdings
Inc., sought Chapter 11 protection (Bankr. D. Del. Lead Case No.
12-13319) on Dec. 11, 2012, with plans to sell assets to secured
lenders.
Ken Ziman, Esq., and Felicia Perlman, Esq., at Skadden, Arps,
Slate Meagher & Flom LLP, serve as counsel to the Debtors.
Rothschild Inc. is the financial advisor.
The steering committee of lenders is represented by attorneys at
Akin Gump Strauss Hauer & Feld LLP and Blank Rome LLP. The agent
under the prepetition and postpetition secured credit facility is
represented by Simpson Thacher & Barlett LLP.
The Debtors disclosed assets of $422 million and liabilities
totaling $575.9 million as of Sept. 30, 2012. As of the
bankruptcy filing, total long-term obligations were $482.2 million
consisting of, among other things, institutional loans and
unsecured subordinated loans. A total of $353.4 million is owing
under the prepetition secured credit facility. A total of
$128.4 million is owing on senior subordinated notes.
LCI HOLDING: Taps Young Conaway as Conflicts Counsel
----------------------------------------------------
LCI Holding Company Inc. and its affiliates seek approval from the
Bankruptcy Court to employ Young Conaway Stargatt & Taylor, LLP,
as conflicts counsel, nunc pro tunc to the Petition Date. Young
Conaway will handle matters that the Debtors may encounter which
are not handled by lead bankruptcy counsel Skadden, Arps, Slate,
Meagher & Flom LLP, because of an actual or potential conflict of
interest, or, alternatively, which can be more efficiently handled
by Young Conaway. The principal attorneys and paralegal presently
designated to represent the Debtors and their standard hourly
rates are:
David R. Hurst $570
Maris J. Kandestin $390
Morgan L. Seward $295
Troy Bollman $150
About LifeCare
LCI Holding Inc. and its affiliates, doing business as LifeCare
Hospitals, operate eight "hospital within hospital" facilities and
19 freestanding facilities in 10 states. The hospitals have about
1,400 beds at facilities in Louisiana, Texas, Pennsylvania, Ohio
and Nevada. LifeCare is controlled by Carlyle Group, which holds
93.4 percent of the stock following a $570 million acquisition in
August 2005.
LifeCare Holdings and its affiliates, including LifeCare Holdings
Inc., sought Chapter 11 protection (Bankr. D. Del. Lead Case No.
12-13319) on Dec. 11, 2012, with plans to sell assets to secured
lenders.
Ken Ziman, Esq., and Felicia Perlman, Esq., at Skadden, Arps,
Slate Meagher & Flom LLP, serve as counsel to the Debtors.
Rothschild Inc. is the financial advisor.
The steering committee of lenders is represented by attorneys at
Akin Gump Strauss Hauer & Feld LLP and Blank Rome LLP. The agent
under the prepetition and postpetition secured credit facility is
represented by Simpson Thacher & Barlett LLP.
The Debtors disclosed assets of $422 million and liabilities
totaling $575.9 million as of Sept. 30, 2012. As of the
bankruptcy filing, total long-term obligations were $482.2 million
consisting of, among other things, institutional loans and
unsecured subordinated loans. A total of $353.4 million is owing
under the prepetition secured credit facility. A total of
$128.4 million is owing on senior subordinated notes.
LEHMAN BROTHERS: NY AG Can't Compel E&Y to Disgorge Fees
--------------------------------------------------------
New York State Supreme Court Justice Jeffrey Oing said the State's
attorney general cannot claim $150 million in fees that Ernst &
Young LLP earned from Lehman Brothers Holdings Inc., according to
a report by Reuters.
The State is suing E&Y over its audit of Lehman. The State sought
the fees that Lehman paid to Ernst & Young between 2001 and 2008.
Judge Oing said the fees could not be recovered by the State
because they were not paid by consumers or the State. "The
allegations in this complaint fail to set forth sufficiently as to
exactly what the public's injury is," Judge Oing said.
David Ellenhorn, senior trial counsel to the New York attorney
general, argued in court that the judge wasn't viewing the relief
correctly, Reuters reported. "Disgorgement is a remedy to
prevent the wrongdoer from obtaining ill-gotten gains," Mr.
Ellenhorn said, according to the report.
Judge Oing, however, disagreed, saying the disgorgement remedy is
not available.
As part of the case, the State attorney general can still pursue
claims for investor damages and restitution against Ernst & Young
if it proves that the firm committed accounting fraud.
The lawsuit, filed in 2010, accused the accounting giant of
helping Lehman cover up its declining health in the months prior
when it approved so-called "Repo 105" transactions and signing
off on financial reports that did not disclose them.
A repo transaction is an artificial sale and buy-back deal that
enabled Lehman to hide billions of debts from regulators and
allowed the company to look healthier and less risky when it
reported quarterly financial data.
The accounting maneuvers discussed in the attorney general's
complaint were first uncovered and discussed in a report by Anton
Valukas, the examiner who made an investigation into Lehman's
bankruptcy filing. The report criticized Ernst & Young for being
"professionally negligent in allowing" the financial reports to
go unchallenged.
Ernst & Young, however, said it acted properly and that Lehman's
accounting complied with national standards.
The case is People of the State of New York v. Ernst & Young, New
York State Supreme Court, New York County, No. 451586/2010.
Separately, a New York federal judge dismissed a lawsuit against
Ernst & Young and Fidelity Management Trust Co. brought by
participants in the Lehman Brothers Savings Plan.
The federal judge ruled the plaintiffs could neither challenge
the companies for not detecting Lehman's financial troubles nor
sue them for not litigating about the fiscal problems, according
to a report by Bankruptcy Law360.
The lawsuit is part of a multidistrict litigation pending in the
Southern District of New York related to securities and Employee
Retirement Income Security Act claims stemming from Lehman's 2008
bankruptcy, Bankruptcy Law360 reported.
About Lehman Brothers
Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was
the fourth largest investment bank in the United States. For
more than 150 years, Lehman Brothers has been a leader in the
global financial markets by serving the financial needs of
corporations, governmental units, institutional clients and
individuals worldwide.
Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy
petition disclosed US$639 billion in assets and US$613 billion in
debts, effectively making the firm's bankruptcy filing the
largest in U.S. history. Several other affiliates followed
thereafter.
Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset
LLC sought for bankruptcy protection in December 2009.
The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at
Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.
On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI.
The Bankruptcy Court approved Barclays Bank Plc's purchase of
Lehman Brothers' North American investment banking and capital
markets operations and supporting infrastructure for US$1.75
billion. Nomura Holdings Inc., the largest brokerage house in
Japan, purchased LBHI's operations in Europe for US$2 plus the
retention of most of employees. Nomura also bought Lehman's
operations in the Asia Pacific for US$225 million.
Lehman emerged from bankruptcy protection on March 6, 2012, more
than three years after it filed the largest bankruptcy in U.S.
history. The Chapter 11 plan for the Lehman companies other than
the broker was confirmed in December 2011.
Lehman made its first payment of $22.5 billion to creditors in
April 2012 and a second payment of $10.2 billion on Oct. 1. A
third distribution is set for around March 30, 2013. The
brokerage is yet to make a first distribution to non-customers.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and other
insolvency and bankruptcy proceedings undertaken by its
affiliates. (http://bankrupt.com/newsstand/or 215/945-700)
LEHMAN BROTHERS: $360-Mil. Settlement With Citigroup Approved
-------------------------------------------------------------
The U.S. Bankruptcy Court in Manhattan approved a deal between
Lehman Brothers Inc.'s trustee and Citigroup that would settle a
dispute over $1 billion in collateral.
The deal requires Citigroup to pay $360 million to the Lehman
brokerage and forgo its claim to $75 million. It also calls for
the dismissal of a lawsuit the trustee filed against Citigroup
early last year.
The Lehman brokerage made a deposit of more than $1 billion in
its last week of operations in exchange for the services provided
by Citigroup. James Giddens, the trustee appointed to liquidate
the brokerage, sued Citigroup early last year to recover the
deposit, which he said should be part of an asset pool to be
distributed among creditors.
In November, the trustee also obtained court approval of his
settlement with Switzerland-based Lehman Brothers Finance AG.
Under the deal, Lehman's Swiss affiliate can assert a claim of
more than $549 million against the brokerage, down from the $6
billion it originally wanted.
Early this month, the trustee asked the bankruptcy court to
approve an agreement with Lehman Brothers Bankhaus AG to cut its
$1.35 billion in claims by more than half. Under the agreement,
The Germany-based Lehman unit can assert a claim of $600 million
against the brokerage.
About Lehman Brothers
Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was
the fourth largest investment bank in the United States. For
more than 150 years, Lehman Brothers has been a leader in the
global financial markets by serving the financial needs of
corporations, governmental units, institutional clients and
individuals worldwide.
Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy
petition disclosed US$639 billion in assets and US$613 billion in
debts, effectively making the firm's bankruptcy filing the
largest in U.S. history. Several other affiliates followed
thereafter.
Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset
LLC sought for bankruptcy protection in December 2009.
The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at
Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.
On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI.
The Bankruptcy Court approved Barclays Bank Plc's purchase of
Lehman Brothers' North American investment banking and capital
markets operations and supporting infrastructure for US$1.75
billion. Nomura Holdings Inc., the largest brokerage house in
Japan, purchased LBHI's operations in Europe for US$2 plus the
retention of most of employees. Nomura also bought Lehman's
operations in the Asia Pacific for US$225 million.
Lehman emerged from bankruptcy protection on March 6, 2012, more
than three years after it filed the largest bankruptcy in U.S.
history. The Chapter 11 plan for the Lehman companies other than
the broker was confirmed in December 2011.
Lehman made its first payment of $22.5 billion to creditors in
April 2012 and a second payment of $10.2 billion on Oct. 1. A
third distribution is set for around March 30, 2013. The
brokerage is yet to make a first distribution to non-customers.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and other
insolvency and bankruptcy proceedings undertaken by its
affiliates. (http://bankrupt.com/newsstand/or 215/945-700)
LEHMAN BROTHERS: $1.351-Bil. Recovered via ADR Settlements
----------------------------------------------------------
Weil Gotshal & Manges LLP, Lehman's legal counsel, filed a 37th
status report on the settlement of claims Lehman Brothers Holdings
Inc. negotiated through the alternative dispute resolution
process.
The status report noted that Lehman served three ADR notices,
bringing the total number of notices served to 277.
Lehman also reached settlement with counterparties in four
additional ADR matters, three as a result of mediation. Upon
closing of those settlements, the company will recover a total of
$1,351,602,056. Settlements have now been reached in 236 ADR
matters involving 331 counterparties.
As of December 12, 91 of the 96 ADR matters that reached the
mediation stage and concluded were settled through mediation.
Only five mediations were terminated without settlement.
Fourteen more mediations are scheduled to be conducted for the
period December 14, 2012 to March 28, 20l3.
About Lehman Brothers
Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was
the fourth largest investment bank in the United States. For
more than 150 years, Lehman Brothers has been a leader in the
global financial markets by serving the financial needs of
corporations, governmental units, institutional clients and
individuals worldwide.
Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy
petition disclosed US$639 billion in assets and US$613 billion in
debts, effectively making the firm's bankruptcy filing the
largest in U.S. history. Several other affiliates followed
thereafter.
Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset
LLC sought for bankruptcy protection in December 2009.
The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at
Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.
On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI.
The Bankruptcy Court approved Barclays Bank Plc's purchase of
Lehman Brothers' North American investment banking and capital
markets operations and supporting infrastructure for US$1.75
billion. Nomura Holdings Inc., the largest brokerage house in
Japan, purchased LBHI's operations in Europe for US$2 plus the
retention of most of employees. Nomura also bought Lehman's
operations in the Asia Pacific for US$225 million.
Lehman emerged from bankruptcy protection on March 6, 2012, more
than three years after it filed the largest bankruptcy in U.S.
history. The Chapter 11 plan for the Lehman companies other than
the broker was confirmed in December 2011.
Lehman made its first payment of $22.5 billion to creditors in
April 2012 and a second payment of $10.2 billion on Oct. 1. A
third distribution is set for around March 30, 2013. The
brokerage is yet to make a first distribution to non-customers.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and other
insolvency and bankruptcy proceedings undertaken by its
affiliates. (http://bankrupt.com/newsstand/or 215/945-700)
LEONARD M. ROSS: Insurer Prevails in Appeals Court
--------------------------------------------------
The Chapter 11 Trustee for Leonard M. Ross and The Leonard M. Ross
Revocable Trust (U/D/T 12-20-85) appeals from an amended judgment
in favor of Carolina Casualty Insurance Co. entered after the
trial court granted in part a motion to amend the original
judgment against L.M. Ross Law Group, LLP to include Ross
individually as a judgment debtor. The court denied the motion to
the extent it sought also to add The Leonard M. Ross Revocable
Trust and the L.M. Ross Professional Law Corporation as judgment
debtors. The Trustee contends the trial court lacked any factual
or legal basis to make Ross personally responsible for the
judgment against Ross Law Group and prejudicially erred in denying
his request to conduct discovery in connection with the motion to
amend the judgment.
In a ruling Monday, the Court of Appeals of California, Second
District, Division Seven, affirmed.
Carolina Casualty issued a legal malpractice insurance policy to
Ross Law Group. On Sept. 20, 2005, four days prior to the
expiration of the legal malpractice policy, Ross Law Group
reported its client Diversified Entertainment Co. had a potential
legal malpractice claim against it arising from a dispute between
DEC and Starlight Home Entertainment, Inc. On Dec. 7, 2007, DEC
sued Ross Law Group for legal malpractice in Los Angeles Superior
Court alleging in connection with an October 2004 transaction the
law firm had improperly advised DEC it had the right to authorize
Starlight to produce, market and distribute a program entitled
"Live! From Las Vegas"; in June 2005 Starlight was enjoined from
distributing the program; and Starlight thereafter sought to
recoup the damages it had suffered as a result of the injunction
by offsetting payments otherwise due from Starlight to DEC. DEC
alleged it suffered damages in excess of $800,000 as a result of
Ross Law Group's negligence.
Ross Law Group tendered the action to Carolina Casualty, which
agreed to defend Ross Law Group under a reservation of rights. In
June 2008, following a mediation, the legal malpractice action was
settled by a total payment of $250,000 to DEC. Carolina Casualty
contributed $175,000 to the settlement; Ross Law Group contributed
$75,000.
As part of their agreement Carolina Casualty and Ross Law Group
each reserved its right to recover the amount it had paid from the
other party; Ross Law Group waived its right to sue Carolina
Casualty for bad faith or breach of the implied covenant of good
faith and fair dealing; and Carolina Casualty waived any right it
may have to recover the defense costs it had incurred in the DEC
action.
In May 2008, roughly one month before the settlement of the DEC
action, Carolina Casualty sued Ross Law Group for declaratory
relief and reimbursement in Los Angeles Superior Court. Carolina
Casualty alleged DEC and its predecessor-in-interest, DMI
Entertainment Co., LLC, were owned and managed or controlled by
Ross, who also owned and managed Ross Law Group, and asserted no
coverage was available for DEC's claim of legal malpractice
against Ross Law Group "'given the obvious potential for collusion
in connection with such claims.'"
The case is CAROLINA CASUALTY INSURANCE COMPANY, Plaintiff, Cross-
defendant and Respondent, v. L.M. ROSS LAW GROUP, LLP et al.,
Defendants, Cross-complainants and Appellants, No. B236373 (Calif.
App. Ct.). A copy of the Court's Dec. 17, 2012 decision is
available at http://is.gd/xpUHoofrom Leagle.com.
About Leonard M. Ross
Beverly Hills, California-based Leonard M. Ross, aka Trustee of
Leonard M. Ross Revocable Trust, filed for Chapter 11 bankruptcy
protection (Bankr. C.D. Calif. Case No. 10-49358) on Sept. 15,
2010. Robert M. Yaspan, Esq., at the Law Offices of Robert M.
Yaspan, assists the Debtor in his restructuring effort. The
Debtor estimated his assets at $100 million to $500 million and
debts at $50 million to $100 million as of the Petition Date.
Affiliates Colony Lodging, Inc. (Bankr. C.D. Calif. Case No.
10-60909), Rossco Plaza, Inc. (Bankr. C.D. Calif. Case No.
10-60917), LJR Properties, Ltd. (Bankr. C.D. Calif. Case No.
10-60919), Monte Nido Estates, LLC (Bankr. C.D. Calif. Case No.
10-60920), WM Properties, Ltd. (Bankr. C.D. Calif. Case No.
10-60918), and Rossco Holdings, Inc. (Bankr. C.D. Calif. Case No.
10-60953) filed separate Chapter 11 petitions.
LEVI STRAUSS: Moody's Corrects October 23 Rating Release
--------------------------------------------------------
Moody's Investors Service issued a correction to the October 23,
2012 rating release of Levi Strauss & Co.
Moody's revised LS&Co's rating outlook to positive from stable.
All other ratings, including the B1 Corporate Family Rating and B2
rating assigned to LS&CO.'s various classes of unsecured debt were
affirmed.
The following ratings were affirmed and LGD assessments amended:
Corporate Family Rating at B1
Probability of Default Rating at B1
$325 million senior unsecured term loan due 2014 at B2 (LGD 4,
66% from LGD 4,69%)
EUR300 million senior unsecured notes due 2018 at B2 (LGD 4, 66%
from LGD 4,69%)
$525 million senior unsecured notes due 2020 at B2 (LGD 4, 66%
from LGD 4,69%)
$385 million senior unsecured notes due 2022 at B2 (LGD 4, 65%
from LGD 4,69%)
Ratings Rationale
Scott Tuhy, Vice President said "The positive rating outlook
reflects Moody's expectation that the company's focus on lean
inventory levels, and the benefits of moderating input costs over
the next few quarters, should enable the company to make continued
progress in expanding gross margins". The outlook revision also
reflects the meaningful reduction in LS&CO's absolute debt levels
over the past few quarters. Moody's also believes the company can
improve operating margins through a continued focus on cost
efficiencies. While Moody's outlook is positive, Moody's has some
concerns around the company's significant European exposure, which
accounted for approximately 24% of the company's YTD revenues.
LS& CO's B1 Corporate Family Rating reflects the company's
moderate (though improving) operating margins and the company's
still significant debt burden (including its meaningful unfunded
pension liability, which exceeded $400 million at its most recent
fiscal year end). Debt/EBITDA was near 4.5 times for the most
recent LTM period. The rating also take into consideration the
company's meaningful global presence, with operations in over 110
countries, and also that the company's has a significant exposure
to the sluggish European market, which accounted for 24% of
revenues in the YTD period. The iconic nature of the Levi's
trademark also underpins the company's overall credit profile as
well as the company's very good liquidity profile.
Ratings could be upgraded if the company is able to maintain
modest growth in operating earnings, indicating the company is
benefiting from lower input costs, inventory discipline and
operating efficiencies. These factors would need to be sufficient
to offset macro-economic challenges, particularly in Europe.
Quantitatively if adjusted operating margins exceed 10%, with
debt/EBITDA sustained below 4.5 times and EBITA/interest expense
remaining above 2.0 times, ratings could be upgraded.
In view of the positive outlook, ratings are unlikely to be
downgraded in the near to intermediate term. Quantitatively,
ratings could be downgraded if debt/EBITDA exceeded 5.5 times or
EBITA/interest fell below 1.5 times. Additionally, ratings could
be downgraded if the company's solid liquidity profile were to
materially erode. The rating outlook could be stabilized if the
company's operating margins began to erode, which most likely
would be the result of a sustained downturn in the global economy,
such that debt/EBITDA was likely to be sustained near 5 times.
The principal methodology used in rating Levi Strauss & Co. 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.
Headquartered in San Francisco, California, Levi Strauss & Co
designs and markets jeans, casual wear and related accessories
under the "Levi's", "Dockers", "Signature by Levi Strauss & Co."
and "Denizen" brands. The company sells product in more than 110
countries through chain retailers, department stores, online sites
and franchised and company-owned stores. Levi Strauss & Co.'s
reported fiscal 2011 net revenues were $4.8 billion.
LITHIUM TECHNOLOGY: Investors Convert $12.5MM Notes Into Equity
---------------------------------------------------------------
Lithium Technology Corporation received a formal request from its
existing investors Stichting Gemeenschappelijk Bezit LTC, The
Hague, The Netherlands, an affiliated party of Arch Hill Capital
N.V., The Hague, The Netherlands, to convert certain convertible
notes in their possession into equity. By doing so, the Investors
exercised their rights for voluntary conversion in accordance with
the terms of the underlying convertible note agreements. The
converted notes are:
* 9% Related Party Convertible Debenture March 2009;
* 10% Related Party Convertible Debenture October 2009 I;
* 10% Related Party Convertible Debenture October 2009 II;
* 10% Related Party Convertible Note January 2010;
* 10% Related Party Convertible Debentures Q2 2010;
* 10% Related Party Convertible Note Van Hessen Interest.
In addition, the Investors have also converted a note with
principal and accrued interest of $638,513 and a conversion price
of $0.0116 which the Investors had acquired from another
noteholder. This note originally formed part of the June 2008 9%
Convertible Notes which otherwise remain unaffected.
The total principal of the converted notes amounts to $9,728,867.
Including accrued interest, the total note amount of the
conversion is $12,536,627. In accordance with the note agreements
and the relevant conversion prices applicable to voluntary
conversion, the Company has awarded a total of 531,753,263 shares
to Stichting Gemeenschappelijk Bezit LTC. As a result, the total
number of shares outstanding of the Company has increased from
2,032,371,256 to the new total of 2,564,124,519.
After the conversion, Stichting Gemeenschappelijk Bezit LTC holds
972,625,161 shares of the Company's common shares and the
affiliated party Arch Hill Capital N.V. holds 343,432,926 shares
of the Company's common shares.
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 its quarterly reports for the succeeding
periods.
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.
LODGENET INTERACTIVE: Likely to File for Ch. 11 Protection
----------------------------------------------------------
Joshua Alston at Bankruptcy Law360 reports that LodgeNet
Interactive Corp. will likely have to file for bankruptcy
protection and restructure the company at year's end if it's
unable to raise $26 million to clear up outstanding debts after
years of struggle, a LodgeNet spokeswoman confirmed Monday.
Bankruptcy Law360 relates that LodgeNet, which provides Internet
and video services to 1.5 million hotel rooms, entered into an
agreement to postpone payments of $26 million owed to Home Box
Office Inc. and DirecTV until Monday, after being unable to free
up the money to pay.
About LodgeNet Interactive
Sioux Falls, South Dakota-based LodgeNet Interactive Corporation
(Nasdaq:LNET), formerly LodgeNet Entertainment Corp. --
http://www.lodgenet.com/-- provides media and connectivity
solutions designed to meet the unique needs of hospitality,
healthcare and other guest-based businesses. LodgeNet Interactive
serves more than 1.9 million hotel rooms worldwide in addition to
healthcare facilities throughout the United States. The Company's
services include: Interactive Television Solutions, Broadband
Internet Solutions, Content Solutions, Professional Solutions and
Advertising Media Solutions. LodgeNet Interactive Corporation
owns and operates businesses under the industry leading brands:
LodgeNet, LodgeNetRX, and The Hotel Networks.
* * *
As reported by the TCR on Aug. 7, 2012, Moody's Investors Services
downgraded LodgeNet Interactive's Corporate Family Rating to
'Caa1' from 'B3' and changed the Probability of Default Rating
(PDR) to 'Caa2' from 'Caa1'. The reason for the downgrade is due
to poor first and second quarter financial results and Moody's
expectations that they will not improve in the near term.
In the Aug. 7, 2012, edition of the TCR, Standard & Poor's Ratings
Services lowered its corporate credit rating on U.S. in-room
entertainment and data services provider LodgeNet Interactive
Corp. to 'CCC' from 'B-'. "The downgrade reflects LodgeNet's weak
second-quarter operating performance resulting from a sharp
reduction in its room base, which we expect will continue over the
near term," said Standard & Poor's credit analyst Hal Diamond.
LOS ANGELES DODGERS: Dewey Gets $500K Bonus for Bankruptcy Work
---------------------------------------------------------------
Eric Hornbeck at Bankruptcy Law360 reports that U.S. Bankruptcy
Judge Kevin Gross on Tuesday gave Dewey & LeBoeuf LLP a $500,000
fee enhancement for its work on the Los Angeles Dodgers baseball
team's bankruptcy, an effort the firm had insisted was
"outstanding."
Bankruptcy Law360 says Judge Gross approved the fee enhancement as
well as the $12.4 million in compensation Dewey requested in its
final fee application.
About Los Angeles Dodgers
Los Angeles Dodgers LLC operates the Los Angeles Dodgers, a
professional Major League Baseball club in the Los Angeles
metropolitan area. Frank McCourt, a Boston real-estate developer
who unsuccessfully bid for the Boston Red Sox, bought the Dodgers
from Rupert Murdoch's Fox Entertainment Group Inc. in 2004 for
$330 million. Mr. McCourt also bought the Dodgers Stadium from
Fox for $100 million.
Los Angeles Dodgers LLC filed for bankruptcy protection (Bankr.
D. Del. Lead Case No. 11-12010) on June 27, 2011, after MLB
Commissioner Bud Selig rejected a television deal with News
Corp.'s Fox Sports, leaving Mr. McCourt unable to make payroll for
June 30 and July 1. Fox Sports has exclusive cable television
rights for Dodgers games until the end of 2013 baseball season.
Chapter 11 filings were also made for LA Real Estate LLC, an
affiliated entity which owns Dodger Stadium, and three other
related holding companies.
According to Forbes, the Dodgers is worth about $800 million,
making it the third most valuable baseball team after the New York
Yankees and the Boston Red Sox.
Judge Kevin Gross presides over the case. Lawyers at Young,
Conaway, Stargatt & Taylor and Dewey & LeBoeuf LLP serve as the
Debtors' bankruptcy counsel. Epiq Bankruptcy Solutions LLC is the
claims and notice agent. Public relations specialist Kekst and
Company has been hired for crisis support. Covington & Burling
LLP serves as special counsel.
An official committee of unsecured creditors has been appointed in
the case. The panel has tapped Lazard Freres & Co. as financial
adviser and investment banker, and Morrison & Foerster LLP and
Pinckney, Harris & Weidinger, LLC as counsel.
The LA Dodgers is the 12th sports team in North America to have
sought bankruptcy protection.
The reorganization is being financed with a $150 million unsecured
loan from the Commissioner of Major League Baseball. The loan
gives the Commissioner few of the controls lenders often demanded
from bankrupt companies.
The Dodgers emerged from bankruptcy on April 30, 2012. The plan
is based on a $2.15 billion sale of the baseball club and Dodger
Stadium to Guggenheim Baseball Management. The plan pays all
creditors in full, with the excess going to Mr. McCourt.
LSP ENERGY: Gets OK to Cut Purchase Price on Mississippi Plant
--------------------------------------------------------------
Marie Beaudette at Dow Jones' DBR Small Cap reports that a
bankruptcy judge said LSP Energy can take $13.25 million off of
the nearly $300 million purchase price for its Mississippi power
plant as the sale is held up by an outage that began in September.
In the motion seeking to amend the asset purchase agreement with
Southern Mississippi Electric Power Association, the Debtors
relate that on Sept. 20, 2012, the Court entered an order (i)
approving the sale of substantially all of the Debtors' assets;
(ii) approving assumption and assignment of certain executory
contracts in connection therewith. Subsequent to the auction, a
mechanical failure occurred at the facility causing all three
units at the facility to be unable. After a period of evaluation,
it was determined that the outage was significant and that it
would take approximately 60 days for the repairs to be completed.
The Debtors add that they completed renewal of the property
insurance, but at a substantially higher costs than previous year,
as direct result of the outage. Ongoing higher insurance costs
have the effect of reducing the value of the facility.
In this relation, the parties entered into Amendment No. 1 to the
purchase agreement, which provides for closing under the terms of
the purchase agreement to occur prior to the end of the year.
The Debtors agree to a $13,25,000 price reduction, reducing the
gross purchase price from $285,876,000 to $272,626,000.
The amendment was designed to accomplish two goals:
i) to complete the sale to SMEPA prior to the end of 2012,
while preserving the value of the sale obtained at the auction;
and
ii) to have the Debtor complete all the repairs with regard to
the outage prior to, or shortly following, closing and take full
financial responsibility for all the repairs necessary to put the
facility back in the same working condition it was prior to the
outage.
A copy of the amended APA is available for free at
http://bankrupt.com/misc/LSPENERGY_amendmenttoapa.pdf
About LSP Energy
LSP Energy Limited owns and operates an electricity generation
facility located in Batesville, Mississippi. The facility
consists of three gas-fired combined cycled electricity generators
with a total generating capacity of approximately 837 magawatts
and is electrically interconnected into the Entergy and Tennessee
Valley Authority transmission systems.
LSP Energy Limited Partnership, LSP Energy, Inc., LSP Batesville
Holding, LLC, and LSP Batesville Funding Corporation filed
separate Chapter 11 bankruptcy petitions (Bankr. D. Del. Lead Case
No. 12-10460) on Feb. 10, 2012.
LSP owns and operates an electric generation facility located in
Batesville, Mississippi. The Facility consists of three gas-fired
combined cycle electric generators with a total generating
capacity of roughly 837 megawatts and is electrically
interconnected into the Entergy and Tennessee Valley Authority
transmission systems. LSP's principal assets are the Facility and
the 58-acre parcel of real property on which it is located, as
well as its rights under a tolling agreements.
LSP filed bankruptcy to complete an orderly sale of its assets or
the ownership interests of LSP Holding in LSP, LSP Energy and LSP
Funding for the benefit of all stakeholders. The remaining three
Debtors filed bankruptcy due to their relationship as affiliates
of LSP and their ultimate obligations on a significant portion of
LSP's secured bond debt. The Debtors also suffered losses due to
a mechanical failure of a combustion turbine at their facility and
resultant business interruption.
LSP Energy is the general partner of LSP. LSP Holding is the
limited partner of LSP and the 100% equity holder of LSP Energy
and LSP Funding. LSP Funding is a co-obligor on the Debtors' bond
debt, and each of LSP Energy and LSP Holding has pledged their
equity interests in LSP and LSP Funding as collateral for the bond
debt.
No statutorily authorized creditors' committee has yet been
appointed in the Debtors' cases by the United States Trustee.
Judge Mary F. Walrath oversees the case. Lawyers at Whiteford
Taylor & Preston LLC serve as the Debtors' counsel.
LSP has a $20 million secured loan provided by lenders including
John Hancock Financial Services Inc. LSP was forced into
bankruptcy following mechanical problems that took one of three
units out of service.
Bondholders have claims for $211 million on two series of secured
bonds. In addition, there was a $3.9 million working capital
facility and $23.3 million in secured debt owing to an affiliate
of Siemens AG, which repairs and maintains the facility.
The Court authorized the Debtors to sell of the facility to the
highest bidder South Mississippi Electic Power Association.
LUKE CUSACK: Court Vacates Rule 2004 Examination Order
------------------------------------------------------
Bankruptcy Judge James M. Marlar vacated his ruling permitting a
Rule 2004 examination in a Chapter 11 case wherein a plan of
reorganization has been confirmed.
Luke Cusack commenced the Chapter 11 case (Bankr. D. Ariz. Case
No. 11-32452) on Nov. 23, 2011. During the course of Luke
Cusack's Chapter 11 bankruptcy case, on July 3, 2012, the Debtor
entered into a settlement agreement with others, including Jason
Turetzky, which settled various claims by and among the Debtor,
Mr. Turetzky and others. The Settlement Agreement referenced, in
several places, the facts of Mr. Cusack's bankruptcy case, its
case number and noted that the agreement had to be approved by the
bankruptcy court. Mr. Turetsky signed the Settlement Agreement.
The Debtor's Chapter 11 plan was confirmed on Aug. 9, 2012. Since
that time, no party-in-interest has appealed, and that order has
become final. The Settlement Agreement was approved as part of
the plan confirmation order dated Aug. 9, 2012. Until now, up to
confirmation and since, Mr. Turetzky never appeared in the
Debtor's bankruptcy case.
Approximately 2-1/2 months after confirmation, in mid-October,
2012, Mr. Turetzky filed what appeared to be a routine 2004
examination request, which the court routinely grants, almost as a
matter of right.
"In this case, had the court realized that a Chapter 11 plan had
already been confirmed, it would have set the 2004 request for a
hearing, to inquire of the movant of the purpose for the request,
how it was related to the confirmed Plan, and whether the court
had retained jurisdiction over the private controversy," said
Judge Marlar. "But here, the court did not pick up on these
details, and, believing it to be merely another routine item,
signed the order on October 26, 2012. . . . Immediately
thereafter, the Debtor filed a motion to quash."
The Debtor also has counter-attacked with requests for sanctions,
contempt and attorneys' fees.
According to Judge Marlar, when a Debtor's plan is confirmed, the
bankruptcy court loses jurisdiction to adjudicate further disputes
involving the Debtor, unless the court has, in some fashion,
retained jurisdiction over the specific subject matter at hand.
"After full review, this court holds that it has not retained
jurisdiction over the substance of this request, as the plan has
been confirmed and neither the moving papers, nor the responses,
indicate any fact which would indicate that the Debtor's confirmed
plan is in default. If Mr. Turetzky has any specific position as
to what portion of the plan is violated, or what plan promises the
Debtor has made that have been breached, Mr. Turetzky will have to
be more specific," Judge Marlar held.
"If Mr. Turetzky believes that the confirmation order -- which is
now final -- was procured by fraud, he is directed to 11 U.S.C.
Sec. 1144, which provides that this is the only way to set aside
such an order. The time limit to file such a motion is 180 days
from confirmation.
"If the starting place for these disputes is to be 11 U.S.C. Sec.
1144, then a full blown trial on the merits is required, not
merely mounds of pleadings which are unsupported by either law, or
affidavits sworn to under penalty of perjury.
"To cut through this bramble bush of unorthodox procedure, the
court will quash all subpoenas issued by Mr. Turetzky, vacate the
2004 examination orders, and require all subpoenaed material to be
returned?unread and unopened?to the sources from which it came.
The court will also not go forward with having hearings on
sanctions, contempt or fees."
A copy of Judge Marlar's Dec. 14, 2012 Memorandum Decision is
available at http://is.gd/GWUtjcfrom Leagle.com.
LUX DIGITAL: Silberstein Ungar Raises Going Concern Doubt
-----------------------------------------------------------
Lux Digital Pictures, Inc., filed on Dec. 14, 2012, its annual
report on Form 10-K for the fiscal year ended Aug. 31, 2012.
Silberstein Ungar, PLLC, in Bingham Farms, Michigan, expressed
substantial doubt about Lux Digital's ability to continue as a
going concern. The independent auditors noted that the Company
has incurred losses from operations, has negative working capital,
and is in need of additional capital to grow its operations so
that it can become profitable.
The Company reported a net loss of $1.32 million on $1.74 million
of revenue for the fiscal year ended Aug. 31, 2012, compared with
a net loss of $205,620 on $nil revenue for the fiscal year ended
Aug. 31, 2011.
The Company's balance sheet at Aug. 31, 2012, showed $1.33 million
in total assets, $2.27 million in total liabilities, and a
stockholders' deficit of $943,835.
A copy of the Form 10-K is available at http://is.gd/vJm8eA
Santa Barbara, Calif.-based Lux Digital Pictures, Inc., a digital
media and technology services company, has only a nine-month
operating history. The Company provides streaming and advertising
services through its RadioLoyalty(TM) Platform to over 1,100
internet and terrestrial radio stations and other broadcast
content providers.
MARK ROBERTS ZIEGLER: Has Green Light to Use Cash Collateral
------------------------------------------------------------
Mark Roberts Ziegler, the owner of two commercial properties in
Montana, won bankruptcy court permission to use cash tied to a
prepetition secured debt. The Court also granted Mr. Ziegler's
request to compel a receiver of Mr. Ziegler's properties to turn
over commercial rental income held by the receiver.
NW Evergreen Opportunities I, LLC, which acquired the secured debt
from U.S. Bank N.A., asked the Court to excuse compliance with
turnover requirements of 11 U.S.C. Sec. 543(a) and for stay relief
under 11 U.S.C. Sec. 362(a) concerning receivership. Judge
Kirscher denied those requests.
Pre-bankruptcy, Mr. Ziegler missed payments to the U.S. Bank debt
and the lender obtained an order from a Washington state court
appointing a receiver for Mr. Ziegler's properties.
Evergreen has filed Claim No. 1 asserting a secured claim for
$1,935,207; and Claim No. 2 asserting a secured claim for
$245,217. The claims are secured by Mr. Ziegler's properties.
Mr. Ziegler proposes to make adequate protection payments on the
two notes evidencing the U.S. Bank debt of $10,000 per month and
$1,905 per month. Mr. Ziegler also contends Evergreen is
protected by an equity cushion based on his opinion of the value
of the two properties. He testified that both properties are
worth between $2.8 million and $3 million, while the total of
Evergreen's two claims is $2,180,425.
The Court will schedule a final hearing on the Debtor's motion to
use cash collateral in any amounts over what is authorized, on
Jan. 10, 2013.
A copy of the Court's Dec. 12, 2012 Memorandum of Decision is
available at http://is.gd/anK9Jafrom Leagle.com.
Mark Roberts Ziegler lives in Missoula, Montana, and owns two
commercial properties. One property is located at 2710 Brooks
Street in Missoula, which he acquired as part of a Sec. 1031
exchange in March 2007. The second property is a 14,000 square
foot building located in Kennewick, Washington, referred to as the
"Kennewick Mall" which Mr. Ziegler acquired in March 2007. The
Brooks Street property has two commercial tenants -- a Subway
sandwich shop and a combination coffee shop/office equipment
store.
Mark Ziegler filed for Chapter 11 bankruptcy (Bankr. D. Mont. Case
No. 12-61681) on Oct. 18, 2012, listing assets in the total amount
of $5,845,021 and liabilities in the total amount of $4,208,536.
Bankruptcy Judge Ralph B. Kirscher oversees the case. The Debtor
has hired Jerry D. Abrams and Jerry D. Abrams Company, Inc., as
real estate management company.
MAXUM PETROLEUM: S&P Raises Corporate Credit Rating to 'B+'
-----------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Greenwich, Conn.-based Maxum Petroleum Operating Co. to
'B+' from 'B'. "We removed the rating from CreditWatch, where we
placed it with positive implications on July 26, 2012, based on
our view of potential improvement in credit quality following the
purchase of a majority interest in the company by Pilot Travel
Centers. The rating outlook is stable," S&P said.
"The rating reflects our view of Maxum's financial risk profile as
'aggressive,' which factors in our expectation that the company
will continue to make modest-size acquisitions to expand its size
in the highly fragmented market and the working capital intensive
nature of its operations. These factors are somewhat mitigated by
Maxum's low maintenance capital spending requirements. We view the
company's business risk profile as 'weak,' based on thin EBITDA
margins that are a characteristic of the diesel distribution
market, a broad operating footprint compared with competitors',
and our expectation for some benefits from the consolidation with
Western Petroleum, which was merged into the company in the third
quarter of 2012," S&P said.
In conjunction with the ownership change at Maxum, the company's
convertible subordinated debt and convertible preferred stock
(that we considered as debt) were eliminated through the
conversion into common equity or were repaid. In addition, as part
of the Pilot acquisition consideration, Pilot contributed 100% of
its ownership interest in Western Petroleum to Maxum, which S&P
considers to be earnings accretive. Credit ratios improved, with
pro forma leverage declining to about 4.7x from nearly 11% at June
30, 2012, and funds from operations (FFO) to debt increasing to
nearly 14% from 9%. S&P anticipates additional improvement in the
next 12 months, with leverage declining to about 3.6x and FFO to
debt increasing to nearly 14%.
S&P's forecast includes:
- Diesel margins increasing to nearly 15 cents from 14 cents
last year on gains from oil price volatility.
- S&P anticipates volumes growth in the service business as it
thinks the company will benefit from an uptick in exploration
and production activities.
- S&P forecasts capital spending of about $25 million to $30
million, funded with internal cash flows.
- S&P anticipates small-sized acquisitions as Maxum acquires
competitors to leverage costs and diversify its product
offerings and customer base. S&P thinks integration risk is
modest given the acquisition size and management's experience
in combining other operations.
"Although Maxum and Pilot share Jimmy Haslan as one of their key
leaders, we think that Maxum's operations are not strategically
important to Pilot because these companies operate different
businesses and Maxum is quite small relative to Pilot from an
earnings and capital perspective. As a result, we are not
providing any uplift to our ratings on Maxum. However, think
these companies could benefit from some purchasing synergies since
they both purchase diesel for their operations, some overhead cost
savings, and transportation logistics (particularly at Maxum),"
S&P said.
MEDIA GENERAL: Signs Affiliation Agreement With NBCUniversal
------------------------------------------------------------
Media General, Inc., and NBCUniversal Media, LLC, executed a new
affiliation agreement. The agreement covers the following
stations: WCBD - Charleston, South Carolina, WSLS - Roanoke,
Virginia; WSAV - Savannah, Georgia, WFLA - Tampa, Florida; WJAR -
Providence, Rhode Island; WNCN - Raleigh, North Carolina; WCMH -
Columbus, Ohio; and WVTM - Birmingham, Alabama. The terms of the
agreement are retroactive to Jan. 1, 2012, and expire on Dec. 31,
2015.
Under the agreement, NBC provides programming in the given markets
consistent with current practices and subject to certain local
preemptions in addition to those mandated by FCC rules and
regulations. Under the agreement, the Company makes certain cash
payments to NBC for inventory management, NBC News Channel,
distribution, Olympics and NFL programming, consistent with the
past agreements. In addition, the agreement requires the
Company's NBC affiliates to pay a variable fee, quarterly, which
is dependent on each station's cable and satellite monthly
retransmission revenue.
The Company has accrued an estimated amount for this fee each
month of 2012. As of Sept. 23, 2012, the end of the third
quarter, the accrued payable approximated $9 million. The Company
anticipates paying approximately $11 million to NBC for 2012,
based on the agreement. The amounts payable in future years will
be dependent on future subscriber counts and the amount of
retransmission revenues received by the Company. The Company
currently estimates that the minimum payment amount will increase
by approximately $8-10 million per year over the term of the
agreement, although the rate of increase could be higher or lower
depending on future subscriber counts and retransmission revenues.
The Company agreed to increasing minimum payments, in part,
because it expects to garner increased retransmission revenues
from agreements it already has signed or expects to renew in the
coming years.
About Media General
Richmond, Virginia-based Media General Inc. (NYSE: MEG) --
http://www.mediageneral.com/-- is an independent communications
company with interests in newspapers, television stations and
interactive media in the United States.
The Company reported a net loss of $74.32 million for the fiscal
year ended Dec. 25, 2011, a net loss of $22.64 million for the
fiscal year ended Dec. 26, 2010, and a net loss of $35.76 million
for the fiscal year ended Dec. 27, 2009.
The Company's balance sheet at Sept. 23, 2012, showed
$773.96 million in total assets, $933.87 million in total
liabilities and a $159.91 million stockholders' deficit.
* * *
As reported by the Troubled Company Reporter on April 12, 2012,
Moody's Investors Service downgraded, among other things, Media
General's Corporate Family Rating (CFR) and Probability of Default
Rating (PDR) to Caa1 from B3, concluding the review for downgrade
initiated on Feb. 13, 2012. The downgrade reflects the
significant increase in interest expense associated with the
company's credit facility amend and extend transaction and an
assumed issuance of at least $225 million of new notes, which will
result in limited free cash flow generation and constrain Media
General's capacity to reduce its very high leverage. The weak
free cash flow and high leverage create vulnerability to changes
in the company's highly cyclical revenue and EBITDA generation.
In the Oct. 10, 2012, edition of the TCR, Standard & Poor's
Ratings Services raised its rating on Richmond, Va.-based Media
General Inc. to 'B-' from 'CCC+' and removed it from CreditWatch,
where it was placed with positive implications on May 18, 2012.
"The corporate credit rating on Media General is based on our
expectation that the company will be able to maintain adequate
liquidity despite its very high leverage," noted Standard & Poor's
credit analyst Jeanne Shoesmith.
MERISEL INC: Saints Capital Discloses 69.3% Equity Stake
--------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Saints Capital Granite, L.P., and Saints
Capital Granite, LLC, disclosed that, as of Nov. 21, 2012, they
beneficially own 5,000,000 shares of common stock of Merisel,
Inc., representing 69.3% of the shares outstanding. A copy of the
filing is available for free at http://is.gd/AxsjAV
On Nov. 21, 2012, Merisel and Saints Capital Granite entered into
a non-binding letter regarding future financing activities whereby
SCGLP agreed to provide a financing facility to Merisel in an
aggregate amount of up to $4,000,000.
About Merisel
Merisel operates in a single reporting segment, the visual
communications services business. It entered that business
beginning March 2005, through a series of acquisitions, which
continued through 2006. These acquisitions include Color Edge,
Inc., and Color Edge Visual, Inc.; Comp 24, LLC; Crush Creative,
Inc.; Dennis Curtin Studios, Inc.; Advertising Props, Inc.; and
Fuel Digital, Inc.
The Company's balance sheet at Sept. 30, 2012, showed
$23.3 million in total assets, $34.1 million in total liabilities,
and a stockholders' deficit of $10.8 million.
"The Company had a cash balance of $286,000 at Sept. 30, 2012, and
experienced reduced revenues for the three and nine months ended
Sept. 30, 2012, compared to the same periods in 2011, resulting in
a net loss and net cash used in operating activities for the
interim periods then ended. Additionally, during October 29th and
30th the Company's Carlstadt, New Jersey facility experienced
significant damage due to Hurricane Sandy. The Company will incur
additional expenses for the replacement/repair of damaged
equipment and to continue to service its client base until the
facility is fully operational. It is anticipated that the
additional costs incurred will exceed the insurance proceeds; the
extent to which is uncertain. These factors raise substantial
doubt about the Company's ability to continue as a going concern,"
according to the Company's quarterly report for the period ended
Sept. 30, 2012.
METEX MFG: Has Court's Nod to Hire Reed Smith as Attorney
---------------------------------------------------------
Metex Mfg. Corporation sought and obtained permission from the
Hon. Burton R. Lifland to employ the law firm of Reed Smith LLP as
attorney, nunc pro tunc to the Commencement Date.
Reed Smith will, among other things:
(a) represent the Debtor, as debtor-in-possession, to
prepare all necessary motions, applications, answers,
orders, reports, and other papers in connection with
the administration of the Debtor's estate;
(b) advise the Debtor with respect to its powers and
duties as debtor and debtor-in-possession in the
continued management and operation of its business
and properties;
(c) attend meetings and negotiate with representatives of
creditors and other parties in interest and advise
and consult on the conduct of the Chapter 11 case,
including all of the legal and administrative
requirements of operating in Chapter 11;
(d) representation of the Debtor in connection with
transactional work as assigned to it from time to
time, including the sale of any assets; and
(e) represent the Debtor on general corporate matters,
including tax, labor, intellectual property, etc. as
assigned to it from time to time;
Reed Smith will be paid at these hourly rates:
Partners: Paul M. Singer $750
Michael J. Venditto $715
Paul E. Breene $685
Gregory L. Taddonio $505
Associates: Joseph D. Filloy $350
Jared S. Roach $350
Paralegals: Anne Suffern $235
Stacy L. Lucas $185
Paul E. Breene, Esq., partner of Reed Smith, attested to the Court
that the firm is a "disinterested person" as that term is defined
in Section 101(14) of the Bankruptcy Code.
About Metex
Great Neck, New York-based Metex Mfg. Corporation, formerly known
as Kentile Floors, Inc., started business in the late 1800's as a
manufacturer of cork tile, and thereafter progressed to making
composite tile for commercial and residential use. It filed for
Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 12-
14554) on Nov. 9, 2012. The petition was signed by Anthony J.
Miceli, president. The Debtor estimated its assets and debts at
$100 million to $500 million. Judge Burton R. Lifland presides
over the case.
Affiliate Kentile Floors, Inc., filed a separate Chapter 11
petition (Bankr. S.D.N.Y. Case No. 92-46466) on Nov. 20, 1992.
MGM RESORTS: Inks $1.2-Bil. Underwriting Agreement with JP Morgan
-----------------------------------------------------------------
MGM Resorts International entered into an underwriting agreement
with Barclays Capital Inc. and J.P. Morgan Securities LLC, as
representatives of the several underwriters. Pursuant to the
Underwriting Agreement, the Company agreed to sell $1.25 billion
in aggregate principal amount of 6.625% senior notes due 2021 to
the Underwriters, and the Underwriters agreed to purchase the
Notes for resale to the public. A copy of the Underwriting
Agreement is available for free at http://is.gd/9JwB6I
About MGM Resorts
MGM Resorts International (NYSE: MGM) --
http://www.mgmresorts.com/-- has significant holdings in gaming,
hospitality and entertainment, owns and operates 15 properties
located in Nevada, Mississippi and Michigan, and has 50%
investments in four other properties in Nevada, Illinois and
Macau.
The Company reported net income of $3.23 billion in 2011 and a net
loss of $1.43 billion in 2010.
MGM's balance sheet at Sept. 30, 2012, showed $27.83 billion in
total assets, $18.56 billion in total liabilities, and
$9.26 billion in total stockholders' equity.
Bankruptcy Warning
In the Form 10-K for the year ended Dec. 31, 2011, the Company
said that any default under the senior credit facility or the
indentures governing the Company's other debt could adversely
affect its growth, its financial condition, its results of
operations and its ability to make payments on its debt, and could
force the Company to seek protection under the bankruptcy laws.
* * *
As reported by the TCR on Nov. 14, 2011, Standard & Poor's Ratings
Services raised its corporate credit rating on MGM Resorts
International to 'B-' from 'CCC+'. In March 2012, S&P revised
the outlook to positive from stable.
"The revision of our rating outlook to positive reflects strong
performance in 2011 and our expectation that MGM will continue to
benefit from the improving performance trends on the Las Vegas
Strip," S&P said.
In March 2012, Moody's Investors Service affirmed its B2 corporate
family rating and probability of default rating. The affirmation
of MGM's B2 Corporate Family Rating reflects Moody's view that
positive lodging trends in Las Vegas will continue through 2012
which will help improve MGM's leverage and coverage metrics,
albeit modestly. Additionally, the company's declaration of a $400
million dividend ($204 million to MGM) from its 51% owned Macau
joint venture due to be paid shortly will also improve the
company's liquidity profile. The ratings also consider MGM's
recent bank amendment that resulted in about 50% of its
$3.5 billion senior credit facility being extended one year from
2014 to 2015.
As reported by the TCR on Oct. 15, 2012, Fitch Ratings has
affirmed MGM Resorts International's (MGM) Issuer Default Rating
(IDR) at 'B-' and MGM Grand Paradise, S.A.'s (MGM Grand Paradise)
IDR at 'B+'.
MILLENNIUM INORGANIC: S&P Ups Rating on Second-Lien Debt to 'BB-'
-----------------------------------------------------------------
Standard & Poor's Ratings Services raised its issue-level rating
on the Millennium Inorganic Chemicals' second-lien debt to 'BB-'
from 'B+' and revised its recovery rating to '4' from '5',
indicating our expectation for an average (30% to 50%) recovery in
the event of a payment default.
"All of our other ratings, including the 'BB-' corporate credit
rating, remain unchanged. The outlook is stable," S&P said.
"The ratings on Millennium reflect the company's limited focus on
cyclical markets subject to commodity product cycles and our
limited visibility into its financial policy. Our expectation that
the company will maintain good free cash flow and adequate
liquidity partially offsets these risks. We characterize
Millennium's business risk profile as 'weak' and its financial
risk profile as 'significant,'" S&P said.
RATINGS LIST
Millennium Inorganic Chemicals
Corporate Credit Rating BB-/Stable/--
Rating Raised
To From
Cristal Inorganic Chemicals US, Inc.
Senior Secured BB- B+
Recovery rating 4 5
MORGAN'S FOODS: Appoints New Chairman and Interim CEO
-----------------------------------------------------
Leonard R. Stein-Sapir will retire as Chairman and Chief Executive
Officer of Cleveland-based Morgan's Foods, Inc., effective
Dec. 31, 2012.
Assuming leadership roles at the Company are James C. Pappas, who
has been named Chairman of the Board of Directors, and James (Jim)
J. Liguori, who has been named interim Chief Executive Officer.
In recognition of his long service and contributions to the
Company, Mr. Stein-Sapir has been named chairman emeritus.
Board member Marilyn Eisele, who chaired the board committee
assigned to identify a transition plan for the Company in
anticipation of Mr. Stein-Sapir's retirement, said both Messrs.
Pappas and Liguori are sound choices for the Company and are well-
positioned to continue the legacy Stein-Sapir leaves at Morgan's
Foods, Inc.
"Both James and Jim know Morgan's well and we are delighted to put
this new management team in place," Eisele said. "They are
assuming the helm of a company that Leonard significantly shaped.
We will miss his leadership and great commitment to this Company,
but appreciate his desire to begin a new chapter in his life that
will allow him to pursue the interests and activities we so often
asked him to put aside in the past in favor of company business."
Mr. Pappas has served as a member of the Morgan's Foods Board of
Directors since February 2012. He is the managing member of JCP
Investment Management, LLC, based in Houston. Prior to JCP,
Pappas worked for the Goldman Sachs Group, in that Company's
investment banking division and was a private investor. He
previously was employed by Bank of America Securities, providing
advice on a wide range of transactions including mergers and
acquisitions, financing, restructurings and buy-side engagements.
Prior to this appointment, Mr. Liguori served as President and
Chief Operating Officer of Morgan's Foods, a position he had held
since 1988. Since joining Morgan's Foods in 1979, he has been
responsible for the Company's total business environment including
operations, human resources, real estate and construction,
marketing, acquisitions and franchisee relations. He currently
serves as an elected member of KFC's National Council of
Advertising Cooperatives, and is chair of that group's beverage
subcommittee. He also serves on KFC's national marketing
committee and its contract and facilities committee. In 2012, he
was the recipient of KFC's President's Award and has received the
company's Navigator Award for restaurant design and development,
as well as the STAR Award from the KFC Franchisee Association.
Prior to joining Morgan's Foods, Mr. Liguori was in charge of
restaurant operations for the Eastern Division of the Campbell
Soup Company. He began his career with Smith Barney, New York.
Mr.Liguori is a founding member and secretary of Providence Ghana
Aid, a non-profit providing medical missions and supplies to
Margret Marquardt Hospital in Ghana. He is a board member of the
McKenzie Fund, which supports continuing education for nursing
professionals working in the pediatric intensive care unit at
Akron Children?s Hospital.
Along with the position he held at Morgan's Foods, Mr. Stein-Sapir
is Chairman and Chief Executive Officer of Mortgage Information
Services (MIS), which operates offices in Cleveland, Ohio, Miami
Lakes, Florida, and Phoenix, Arizona. The company provides
national mortgage lenders with flood zone certifications, property
reports, title insurance policies, property valuation reports,
appraisals and settlement services in all 50 states. Prior to
starting MIS in 1990, Stein-Sapir was Chairman and Chief Executive
Officer for Record Data, Inc., the nation's largest title
insurance agency, which became part of TRW in 1985. Earlier in
his career, Mr. Stein-Sapir served as vice president of corporate
development for Jewelcor, Inc., and was associated with the
corporate finance department of Oppenheimer and Company. He began
his career as an attorney for the corporate finance division of
the Securities and Exchange Commission.
Mr. Stein-Sapir, 73, serves on the board of directors at Automated
Packaging, Inc., in Streetsboro, Ohio, and has served as a trustee
and member of the executive committee of the Montefiore Home for
the Aged, the advisory board of US Bank Cleveland, the director's
circle of the Cleveland Museum of Art, the board of directors of
TAVMA (Title, Appraisal, Vendor, Management, Association) and a
member of the board of trustees of the Cleveland Play House.
About Morgan's Foods
Cleveland, Ohio-based Morgan's Foods, Inc., which was formed in
1925, operates through wholly-owned subsidiaries KFC restaurants
under franchises from KFC Corporation, Taco Bell restaurants under
franchises from Taco Bell Corporation, Pizza Hut Express
restaurants under licenses from Pizza Hut Corporation and an A&W
restaurant under a license from A&W Restaurants, Inc.
As of May 20, 2011, the Company operates 56 KFC restaurants,
5 Taco Bell restaurants, 10 KFC/Taco Bell "2n1's" under franchises
from KFC Corporation and franchises from Taco Bell Corporation,
3 Taco Bell/Pizza Hut Express "2n1's" under franchises from Taco
Bell Corporation and licenses from Pizza Hut Corporation,
1 KFC/Pizza Hut Express "2n1" under a franchise from KFC
Corporation and a license from Pizza Hut Corporation and 1 KFC/A&W
"2n1" operated under a franchise from KFC Corporation and a
license from A&W Restaurants, Inc.
The Company reported a net loss of $1.68 million for the year
ended Feb. 26, 2012, compared with a net loss of $988,000 for the
year ended Feb. 27, 2011.
The Company's balance sheet at Aug. 12, 2012, showed
$52.67 million in total assets, $53.47 million in total
liabilities, and a $800,000 total shareholders' deficit.
MMRGLOBAL INC: Unit Has New License Agreement With 4medica
----------------------------------------------------------
MyMedicalRecords, Inc., executed a Non-Exclusive Patent License
Agreement with 4medica, Inc., to license certain rights in the
Company's Health IT patents, including, but not limited to: U.S.
Patent No. 8,321,240; U.S. Patent No. 8,301,466; U.S. Patent No.
8,117,045; U.S. Patent No. 8,117,646; and U.S. Patent No.
8,121,855, as well as any other Health IT patents to be issued
pursuant to pending applications filed by the Company in the
United States and all divisions, continuations, reissues and
extensions thereof. The Agreement expires simultaneously with the
last to expire of the Licensed Patents.
The Licensee will utilize the rights granted under the Licensed
Patents in connection with its Health IT business, including
Licensee's iEHR and lab portal products, including, without
limitation: (i) the 4medica Electronic Health Record for
physicians practices and clinics; (ii) the 4medica iEHR for
Inpatient, which is an Electronic Health Record intended for
hospitals and other health centers; (iii) the 4medica Lab4 and
Imaging4 web-portal based products sold to hospitals,
laboratories, healthcare professionals or patients; (iv)
applicable components of the products; and (v) derivations of the
products using or incorporating, in whole or in part, the Licensed
Patents.
About MMRGlobal
Los Angeles, Calif.-based MMR Global, Inc. (OTC BB: MMRF)
-- http://www.mmrglobal.com/-- through its wholly-owned operating
subsidiary, MyMedicalRecords, Inc., provides secure and easy-to-
use online Personal Health Records (PHRs) and electronic safe
deposit box storage solutions, serving consumers, healthcare
professionals, employers, insurance companies, financial
institutions, and professional organizations and affinity groups.
In the auditors' report accompanying the financial statements for
year ended Dec. 31, 2011, Rose, Snyder & Jacobs LLP, in Encino,
California, expressed substantial doubt about the Company's
ability to continue as a going concern. The independent auditors
noted that the Company has incurred significant operating losses
and negative cash flows from operations during the years ended
Dec. 31, 2011, and 2010.
The Company reported a net loss of $8.88 million in 2011, compared
with a net loss of $17.90 million in 2010. The Company reported a
net loss of $10.3 million in 2009.
The Company's balance sheet at Sept. 30, 2012, showed
$2.02 million in total assets, $8.48 million in total liabilities,
and a $6.45 million total stockholders' deficit.
MOUNTAIN PROVINCE: Obtains Support for Gahcho Kue Project
---------------------------------------------------------
Economic benefits for the Northwest Territories and Canada, a
comprehensive environmental plan and extensive engagement with
communities and regulators drew praise from both government and a
number of Aboriginal groups that attended five days of public
hearings into the proposed Gahcho Kue Project, 280km northeast of
Yellowknife.
Gahcho Kue, a joint venture of De Beers and Mountain Province
Diamonds, began the Environmental Impact Review process in 2006.
In December 2011, an 11,000 page Environmental Impact Statement
was submitted to the Mackenzie Valley Environmental Impact Review
Board. The Gahcho Kue Panel struck by the Board held community
and public hearings in Dettah, Lutsel K'e and Yellowknife between
November 30 and December 7.
De Beers Canada Chief Operating Officer Glen Koropchuk, who
provided opening remarks at the Yellowknife hearings on behalf of
the Gahcho Kue JV, said the years of working collaboratively with
the local communities near the Gahcho Kue site helped shape the
project design. "We are confident that the Project is not only
technically sound, but also reflects our commitment to sustainable
development by listening to our community partners and
incorporating key input that makes this project viable and
respects local priorities."
The proposed Gahcho Kue Project comes at a time when the GDP of
the Northwest Territories has started to decline due to the
reduced output from the territories' two oldest diamond producers.
Mountain Province Diamonds President & CEO Patrick Evans said:
"Since the discovery of Gahcho Kue 20 years ago, more than $200
million has been invested in exploration, social and environmental
studies, engineering design, feasibility studies and consultation.
This reflects an extraordinary commitment on the part of our
shareholders to the people and diamond industry of Canada's
Northwest Territories. Last week's public hearings mark an
important milestone towards the development of Canada's next great
diamond mine. The successful permitting of Gahcho Kue will secure
the Northwest Territories' position as one of the world's leading
diamond producing regions".
During the hearings, a groundbreaking collaborative monitoring
forum, Ni Hadi Yati, was proposed jointly by the Yellowknives Dene
First Nation, Lutsel K'e Dene First Nation, Deninu K'ue First
Nation, Tlicho Government and De Beers. This forum would be
funded by the Gahcho Kue JV and is proposed to provide increased
capacity to Aboriginal groups to improve understanding and
involvement in environmental monitoring programs. The North Slave
Metis Alliance and NWT Metis Nation have also been invited to
participate.
De Beers and Mountain Province Diamonds thanked all those that
participated in the public hearings and throughout the
Environmental Impact Review process and look forward to a positive
report from the Gahcho Kue Panel of the Mackenzie Valley
Environmental Impact Review Board.
About Mountain Province
Headquartered in Toronto, Canada, Mountain Province Diamonds Inc.
(TSX: MPV, NYSE AMEX: MDM) -- http://www.mountainprovince.com/--
is a Canadian resource company in the process of permitting and
developing a diamond deposit known as the "Gahcho Kue Project"
located in the Northwest Territories of Canada. The Company's
primary asset is its 49% interest in the Gahcho Kue Project.
After auditing the financial statements for the year ended
Dec. 31, 2011, KPMG LLP, in Toronto, Canada, noted that the
Company has incurred a net loss in 2011 and expects to require
additional capital resources to meet planned expenditures in 2012
that raise substantial doubt about the Company's ability to
continue as a going concern.
The Company reported a net loss of C$11.53 million for the year
ended Dec. 31, 2011, compared with a net loss of C$14.53 million
during the prior year.
Mountain Province's balance sheet at Sept. 30, 2012, showed
C$53.03 million in total assets, C$8.81 million in total
liabilities and C$44.22 million in total shareholders' equity.
MSR RESORT: Inks Stipulation for Continued Cash Use Until Jan. 31
-----------------------------------------------------------------
MSR Resort Golf Course Llc, et al., entered into a stipulation and
order with Midland Loan Services, Inc., further extending cash
collateral use under final order authorizing the Debtors to (i)
use the prepetition secured parties' cash collateral and (ii)
provide adequate protection to the prepetition secured parties.
The stipulation provides for, among other things:
1. Midland has consented to the Debtors' continuing use of cash
collateral until Jan. 31, 2013; and
2. Midland agrees to the temporary waiver and forbearance;
provided, however, that nothing herein will operate as a waiver or
forbearance of any of Midland's other rights under the cash
collateral order (as modified herein), including, without
limitation, Midland's rights to serve a termination notice or
otherwise declare a termination notice event.
A hearing on Dec. 21, 2012, at 10 a.m. has been set.
About MSR Resort
MSR Hotels & Resorts, formerly known as CNL Hotels & Resorts Inc.,
owned 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.
Bankruptcy Judge Sean H. Lane signed off on MSR Resort Golf Course
LLC's disclosure statement, clearing the resort owner to begin
soliciting votes for its Chapter 11 plan following a recent
agreement to sell off its five-resort portfolio for $1.5 billion.
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.
MTS LAND: Plan Proposes Full Payment to Unsecured Creditors
-----------------------------------------------------------
MTS Land, LLC, and MTS Golf, LLC, filed with the U.S. Bankruptcy
Court for the District Of Arizona a Plan of Reorganization.
According to the Plan, the DIP loan documents will remain in full
force and effect, save and except that without any further action
by the Reorganized Debtor or DIP lender.
Other secured claims will be paid in full in cash.
Priority unsecured claims and general unsecured claim will be paid
in full in cash. General unsecured claims will also be paid post-
Effective Date, soon as practical.
On the Effective Date, holders of equity securities of the debtors
will retain all of their legal interests.
A copy of the Plan is available for free at
http://bankrupt.com/misc/MTS_GOLF_plan.pdf
In a separate filing, the Debtors has requested for additional
time to file a Disclosure Statement in support of the Debtors'
Plan. The Debtors related that a disclosure statement has been
drafted, but additional time is needed to complete it.
About MTS Land
MTS Land LLC and MTS Golf LLC own and operate the now dormant
Mountain Shadows Golf Club. They filed separate Chapter 11
petitions (Bankr. D. Ariz. Case Nos. 12-16257 and 12-16257) in
Phoenix on July 19, 2012. Mountain Shadows Golf Club --
http://www.mountainshadowsgolfclub.com/-- is an 18 hole, par 56
course located at Paradise Valley. Nestled in the foothills of
Camelback Mountain, the 3,081-yard Executive course claims to be
one of the most scenic golf courses in Arizona. MTS Land and MTS
Golf are affiliates of Irvine, Calif.-based Crown Realty &
Development Inc. MTS Land and MTS Golf each estimated assets and
debts of $10 million to $50 million.
Judge Charles G. Case II oversees the Debtors' cases. Lawyers at
Gordon Silver serve as the Debtors' counsel. The petition was
signed by Robert A. Flaxman, administrative agent.
Lender U.S. Bank is represented by Steven D. Jerome, Esq., and
Evans O'Brien, Esq., at Snell & Wilmer L.L.P.
The U.S. Trustee for Region 14 advised the Court that an official
committee of unsecured creditors has not been appointed because an
insufficient number of persons holding unsecured claims against
the Debtors have expressed interest in serving on a committee.
The U.S. Trustee reserves the right to appoint a committee if
interest develop among the creditors.
MUSCLEPHARM CORP: Enters Into $1 Million Bridge Facility
--------------------------------------------------------
MusclePharm Corporation entered into a $1 million bridge facility
to provide short-term financing to the Company. In connection
with the bridge facility, the Company entered into a Subscription
Agreement with six subscribers pursuant to which the Company
issued an aggregate $1,000,000 principal amount of promissory
notes and 50,000 shares of the Company's common stock to the
Subscribers for cash.
The Notes are due Jan. 18, 2013, do not bear interest, and may be
pre-paid in full at anytime without penalty to the Company. If
not repaid in full at maturity, following a five-day grace period,
the default interest rate would be 12% per annum. Events of
default under the Notes are defined broadly and include failure to
pay principal and breach of covenants in the Subscription
Agreement.
In the Subscription Agreement, so long as any Note is outstanding,
the Company agreed not to (i) create any material liens upon its
property; (ii) amend its articles of incorporation or bylaws so as
to materially and adversely affect any rights of the Subscribers;
(iii) repay, repurchase or otherwise acquire or make any cash
dividend or cash distribution in respect of any of its equity
securities or (iv) engage in any transactions with any officer,
director, employee or any affiliate of the Company. The
Subscription Agreement restricts the Company's ability to issue
securities except in certain limited circumstances while the Notes
are outstanding without the consent of the Subscribers and notably
restricts undertaking any additional capital raise unless the
proceeds are used to pay in full the Notes.
Additionally, the Company granted the Subscribers "piggy-back"
registration rights for the Shares in certain circumstances. The
Subscription Agreement also contained customary representations
and warranties, indemnification provisions, and additional
covenants.
About MusclePharm
Headquartered in Denver, Colorado, MusclePharm Corporation
(OTC BB: MSLP) -- http://www.muslepharm.com/-- is a healthy life-
style company that develops and manufactures a full line of
National Science Foundation approved nutritional supplements that
are 100% free of banned substances. MusclePharm is sold in over
120 countries and available in over 5,000 U.S. retail outlets,
including GNC and Vitamin Shoppe. MusclePharm products are also
sold in over 100 online stores, including bodybuilding.com,
Amazon.com and Vitacost.com.
The Company reported a net loss of $23.28 million in 2011,
compared with a net loss of $19.56 million in 2010.
The Company's balance sheet at Sept. 30, 2012, showed
$7.81 million in total assets, $15.10 million in total
liabilities, and a $7.29 million total stockholders' deficit.
In the auditors' report accompanying the consolidated financial
statements for the year ended Dec. 31, 2011, Berman & Company,
P.A., in Boca Raton, Florida, expressed substantial doubt about
the Company's ability to continue as a going concern. The
independent auditors noted that the Company has a net loss of
$23,280,950 and net cash used in operations of $5,801,761 for the
year ended Dec. 31, 2011; and has a working capital deficit of
$13,693,267, and a stockholders' deficit of $12,971,212 at
Dec. 31, 2011.
NASH FINCH: Moody's Affirms 'Ba3' CFR/PDR; Outlook Negative
-----------------------------------------------------------
Moody's Investors Service changed Nash Finch Company's ratings
outlook to negative from stable and revised the company's
Speculative Grade Liquidity rating to SGL-3 from SGL-2. At the
same time, Moody's affirmed Nash Finch's Ba3 corporate family and
probability of default ratings and the B2 rating on the company's
convertible senior subordinated notes.
The change in the ratings outlook to negative reflects the
company's lack of progress in improving its credit metrics. Nash
Finch's ability to grow earnings and to deleverage has become less
certain given continuing operating weaknesses. "We are concerned
that the company's EBITDA contribution from its military segment
has been pressured because of increased competition," stated
Moody's Analyst Mariko Semetko. While the military segment has
historically provided the company with a unique source of
stability, the competitive pressures combined with the
manufacturers bidding process have resulted in lower
profitability. In addition, the independent grocery stores (the
core customers of Nash Finch's food distribution segment) remain
under significant pressure from large grocery store chains, big-
box discounters, warehouse clubs, drug stores, and dollar stores.
As a result, Nash Finch's debt/EBITDA will likely remain
moderately high in the near future. However, the expansion of the
private label business combined with newly awarded contracts will
mitigate some of these operating challenges.
The revision of Nash Finch's Speculative Grade Liquidity rating to
SGL-3 reflects Moody's expectations for lower free cash flow and
higher reliance on its asset based revolving credit facility (ABL)
over the next twelve months. Moody's expects the company to
maintain adequate near term liquidity stemming from minimal cash
balances, breakeven levels of free cash flow after potentially
higher tax payments related to the planned repayment of the notes,
and modest availability under the ABL after the reserve
requirements to retire the notes. The company is required to
maintain a $150 million reserve under the ABL to retire its
subordinated convertible notes (rated B2) which will be putable
and callable in March 2013. The company recently upsized its ABL
to $590 million from $520 million which has offset the incremental
drawings used to fund the recent acquisitions, and extended the
expiration date by one year to December 21, 2017.
Ratings affirmed:
- Corporate Family Rating at Ba3
- Probability of Default Rating at Ba3
- Convertible senior subordinated notes with $150 million
outstanding due 2035 at B2 (LGD6, 92%)
Ratings downgraded:
- Speculative Grade Liquidity Rating to SGL-3 from SGL-2
The outlook is negative.
Ratings Rationale
Nash Finch's Ba3 corporate family rating reflects its significant
presence in the military distribution industry and its good
interest coverage relative to distribution company peers. The
rating is also supported by the company's diverse customer base in
the food distribution segment and Moody's expectation that the
company will maintain at least adequate liquidity over the next
twelve months. At the same time, the rating is constrained by debt
leverage that is high for the Ba3 rating, high competition, and
low margins inherent to the food distribution industry.
The negative outlook reflects Moody's view that Nash Finch's
operating environment will remain challenging and competitive over
the next 12-18 months. The outlook stems from the uncertainties
that the company can reverse its declining revenue and earnings
trends and start to deleverage.
The rating could be downgraded should revenue levels not stabilize
or should credit metrics or liquidity erode further through weaker
earnings, material debt-funded acquisitions, dividends or share
repurchases. Quantitatively, ratings could be lowered if
debt/EBITDA is sustained above 4.0 times or EBITA/interest expense
is sustained below 2.0 times.
Given the negative outlook, an upgrade in the near term is
unlikely. Over time, an upgrade would require revenue growth and
significant credit metric improvements while maintaining good
liquidity including generating positive free cash flow.
The principal methodology used in rating Nash Finch was the Global
Retail Industry Methodology published in June 2011. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
Nash Finch, headquartered in Edina, Minnesota, reports three
operating segments: military food distribution, food distribution,
and retail supermarkets. The military distribution segment
accounts for nearly half of Nash Finch's revenues. The food
distribution segment distributes groceries to retailers, including
Nash Finch's own 74 supermarkets that are primarily located in the
Upper Midwest of the United States. Revenues for the 12 months
ending October 6, 2012 were approximately $4.8 billion.
NAVISTAR INTERNATIONAL: Appoints Samuel Merksamer to Board
----------------------------------------------------------
Navistar International Corporation announced Samuel J. Merksamer,
managing director at Icahn Capital LP, has been appointed to the
Company's Board of Directors. He replaces Diane Gulyas, who
retired after serving three years as a board member. Mr.
Merksamer's appointment to the board and Ms. Gulyas's retirement
are effective Dec. 10, 2012, maintaining the total number of
Navistar board members at 10, nine of whom are independent.
The appointment of Mr. Merksamer represents the third board member
appointment pursuant to the agreement the company entered into
with Icahn Partners and its affiliated entities and MHR Fund
Management LLC and its affiliated entities. Mr. Merksamer will
stand for election at the Company's 2013 Annual Meeting of
Shareholders.
"We welcome Sam to the board and we look forward to his insights
as we continue to execute on our plan to drive long-term
profitability and deliver shareholder value," said Lewis B.
Campbell, Navistar's chairman and chief executive officer. "On
behalf of the Board, I would also like to thank Diane for her
contributions and service to Navistar during her time as a
director."
Samuel J. Merksamer is a managing director at Icahn Capital LP,
where he has served since 2008. Mr. Merksamer is responsible for
identifying, analyzing and monitoring investment opportunities and
portfolio companies for Icahn Capital. Mr. Merksamer serves as a
director of Viskase Companies, Inc., American Railcar Industries
Inc., Federal-Mogul Corporation and CVR Energy, Inc., and he
served on the board of directors of Dynegy Inc. from March 2011
through September 2012. From 2003 until 2008, Mr. Merksamer was
an analyst at Airlie Opportunity Capital Management, a hedge fund
management company, where he focused on high yield and distressed
investments. Mr. Merksamer received an A.B. in Economics from
Cornell University in 2002.
About Navistar International
Navistar International Corporation (NYSE: NAV) --
http://www.Navistar.com/-- is a holding company whose
subsidiaries and affiliates subsidiaries produce International(R)
brand commercial and military trucks, MaxxForce(R) brand diesel
engines, IC Bus(TM) brand school and commercial buses, Monaco RV
brands of recreational vehicles, and Workhorse(R) brand chassis
for motor homes and step vans. It also is a private-label
designer and manufacturer of diesel engines for the pickup truck,
van and SUV markets. The company also provides truck and diesel
engine parts and service. Another affiliate offers financing
services.
The Company's balance sheet at July 31, 2012, showed
$11.14 billion in total assets, $11.50 billion in total
liabilities, and a $363 million total stockholders' deficit.
* * *
In the Aug. 3, 2012, edition of the TCR, Moody's Investors Service
lowered Navistar International Corporation's Corporate Family
Rating (CFR), Probability of Default Rating (PDR), and senior note
rating to B2 from B1. The downgrade of Navistar's ratings
reflects the significant challenges the company will face during
the next eighteen months in re-establishing the profitability and
competitiveness of its US and Canadian truck operations in light
of the failure to achieve EPA certification of its EGR emissions
technology, the significant reductions in military revenues and
substantially higher engine warranty reserves.
As reported by the TCR on June 13, 2012, Standard & Poor's Ratings
Services lowered its ratings on Navistar International Corp.,
including the corporate credit rating to 'B+', from 'BB-'. "The
downgrade and CreditWatch placement reflect the company's
operational and financial setbacks in recent months," said
Standard & Poor's credit analyst Sol Samson.
In the Sept. 19, 2012, edition of the TCR, Fitch Ratings has
downgraded the Issuer Default Ratings (IDR) for Navistar
International Corporation (NAV) and Navistar Financial
Corporation (NFC) to 'CCC' from 'B-'. The rating Outlook is
Negative. The rating downgrades and Negative Rating Outlook
reflect the company's heightened liquidity risk and negative
manufacturing free cash flow (FCF) which could continue into 2013.
NEWPAGE CORP: S&P Gives $500MM Secured Loan Prelim. 'BB' Rating
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary 'BB'
issue-level and '1' preliminary recovery rating to Miamisburg,
Ohio-based NewPage Corp.'s proposed $500 million senior secured
term loan. "The preliminary '1' recovery rating incorporates our
expectation of very high (90% to 100%) recovery of principal
in the event of a postemergence default by the company," S&P said.
"The rating action reflects NewPage's recent announcement that the
U.S. Bankruptcy Court has confirmed the company's Chapter 11 plan
of reorganization," said Standard & Poor's credit analyst Tobias
Crabtree. "Under the terms of the plan, NewPage would reduce its
total reported debt to $500 million from over $4 billion and lower
its annual interest expense by approximately $345 million to about
$45 million."
"The preliminary 'BB' issue-level rating and expected 'B+'
corporate credit rating are subject to NewPage's timely emergence
from bankruptcy and consummation of its plan of reorganization in-
line with our expectations, including its proposed exit financing.
The preliminary and expected ratings are subject to the company's
$350 million asset-based lending facility (ABL) and $500 million
term loan being finalized on substantially the same terms as
represented to us in November 2012. If the company cannot obtain
exit financing as proposed and it emerges from bankruptcy with a
significantly different capital structure, we could withdraw the
preliminary ratings and assign a lower corporate credit rating.
The preliminary and expected ratings are also subject to the final
documentation and our review of legal matters that we believe are
relevant to our analysis, as outlined in our criteria," S&P said.
"The expected 'B+' corporate credit rating reflects our view of
NewPage's 'vulnerable' business risk profile derived from its
limited product and geographic diversity, substitution risks due
to changing customer preferences for greater electronic content,
and vulnerability to fluctuations in volatile coated paper selling
prices and raw material and energy costs. Our ratings also
incorporate our assessment of the company's 'significant'
financial risk and 'strong' liquidity position. In our view, post-
emergence credit measures will benefit from a substantial
reduction in total debt and interest expense such that leverage is
likely to be maintained below 3.5x and interest coverage to exceed
5x over the next 12 to 18 months. In addition, the company's
strong liquidity position results from the financial flexibility
afforded by the absence of near-term debt maturities and financial
maintenance covenants and good prospects for free cash flow
generation even under a stressed scenario," S&P said.
"We expect to assign a stable rating outlook to the expected 'B+'
corporate credit rating supported by the company's strong
liquidity position and significant debt and interest expense
reduction post-emergence which is anticipated to result in good
free cash flow generation over the next year. We believe the
company's low leverage affords it significant financial
flexibility over the near-to-intermediate term to meet its capital
expenditure requirements and withstand the secular decline in its
coated paper end markets and vulnerability of earnings to changes
in coated paper prices and input costs," S&P said.
"An upgrade is limited by our assessment of NewPage's vulnerable
business risk given the substantial challenges facing the North
American coated paper industry. In addition, ratings upside is
limited by the likely influence that the new equity owners will
have over financial policy, such as dividends," S&P said.
"We could downgrade the company if its financial profile were
revised to 'aggressive' as a result of leverage exceeding 4x and
FFO to debt declining to the mid-teen percentage range on a
sustained basis. For this to occur, absent a change in the
company's post-emergence proposed capital structure, EBITDA would
have to decline in excess of 20% from our 2012 forecast. We view
this as a low probability event over the upcoming year, most
likely triggered by a U.S. recession accelerating the decline in
coated paper demand and pressuring coated paper prices," S&P said.
NEXSTAR BROADCASTING: Silver Point Owns 7.8% of Class A Shares
--------------------------------------------------------------In a
Schedule 13G filing with the U.S. Securities and Exchange
Commission, Silver Point Capital, L.P., and its affiliates
disclosed that, as of Nov. 30, 2012, they beneficially own
1,566,000 shares of Class A common stock of Nexstar Broadcasting
Group, Inc., representing 7.8% of the shares outstanding. A copy
of the filing is available for free at http://is.gd/sFHyKu
About Nexstar Broadcasting Group
Irving, Texas-based Nexstar Broadcasting Group Inc. currently
owns, operates, programs or provides sales and other services to
62 television stations in 34 markets in the states of Illinois,
Indiana, Maryland, Missouri, Montana, Texas, Pennsylvania,
Louisiana, Arkansas, Alabama, New York, Rhode Island, Utah and
Florida. Nexstar's television station group includes affiliates
of NBC, CBS, ABC, FOX, MyNetworkTV and The CW and reaches
approximately 13 million viewers or approximately 11.5% of all
U.S. television households.
The Company reported a net loss of $11.89 million in 2011, a net
loss of $1.81 million in 2010, and a net loss of $12.61 million in
2009.
The Company's balance sheet at Sept. 30, 2012, showed
$611.35 million in total assets, $771.63 million in total
liabilities and a $160.27 million total stockholders' deficit.
* * *
As reported by the TCR on Oct. 26, 2012, Standard & Poor's Ratings
Services raised its corporate credit rating on Irving, Texas-based
Nexstar Broadcasting Group Inc. and on certain subsidiaries to
'B+' from 'B'. "The rating action reflects our view that the
stations that Nexstar will acquire from Newport will improve the
company's business risk profile and that trailing-eight-quarter
leverage will improve to 6x or less over the intermediate term,"
said Standard & Poor's credit analyst Daniel Haines.
In the Oct. 26, 2012, edition of the TCR, Moody's Investors
Service upgraded the corporate family and probability of default
ratings of Nexstar Broadcasting, Inc. (Nexstar) to B2 from B3.
The upgrade and positive outlook incorporate expectations for
continued improvement in the credit profile resulting from both
the transaction and Nexstar's operating performance.
NFR ENERGY: Moody's Rates New Term Loan 'Caa1'; Outlook Negative
----------------------------------------------------------------
Moody's Investors Service assigned a Caa1 rating to NFR Energy
LLC's (NFR) proposed $500 million senior secured second-lien term
loan due 2018. Moody's also downgraded the ratings on the
company's existing $350 million senior notes due 2017 to Caa2 from
Caa1 and affirmed NFR's B3 Corporate Family Rating (CFR). The
rating outlook was changed to negative from stable. The proceeds
from the new senior secured second-lien term loan, together with
new equity from First Reserve and revolver borrowings, will be
used to fund two acquisitions. Concurrent with these transactions,
First Reserve is acquiring 100% of Nabors's interest in NFR's
parent company, NFR Holdings LLC, making First Reserve the owner
of substantially all of NFR.
Ratings Rationale
"The recently announced acquisitions enhance NFR's scale, increase
its exposure to liquids production, and improves its geographic
diversity," commented Pete Speer, Moody's Vice President.
"However, the meaningful increase in the company's financial
leverage, NFR's limited liquidity, and the execution risk on the
new properties caused us to change the outlook to negative."
NFR is acquiring TLP Energy LLC (TLP) and certain Eagle Ford Shale
assets from two independent oil and gas companies (Eagle Ford
Shale Assets) for $736 million. The TLP acquisition adds
approximately 64,000 net acres in areas of the Cleveland Sand and
Granite Wash plays in the Anadarko Basin that have high natural
gas liquids (NGL) content, while the Eagle Ford Shale asset
acquisition adds approximately 2,300 net acres to NFR's existing
position in that basin. The acquired properties produced about
6,500 boe per day of production and add an estimated 60 million
boe of proved reserves. This increases the company's production
and reserves scale by approximately 33% and 30%, respectively,
compared to third quarter 2012 production and 2011 proved
reserves.
The acquired reserves are approximately 55% oil and NGLs,
therefore the acquired acreage provides significant running room
for NFR to diversify its product and basin exposure away from
natural gas and the East Texas Haynesville Shale. The company's
pro forma production is 26% liquids, up significantly from 14% in
the third quarter 2012. NFR forecasts that it can increase liquids
production to over 35% by the fourth quarter of 2013, with around
15% being oil.
However, about two-thirds of the acquired reserves are proved
undeveloped (PUD), which will require significant capital
investment to convert these reserves to production. The
transaction will be funded with the $500 million term loan, some
cash equity from First Reserve and the contribution of its equity
ownership in TLP. The added debt will significantly increase NFR's
leverage on production and diminish its cash flow coverage of
debt, with pro forma Debt/Average Daily Production rising above
$50,000/boe from about $32,000/boe at September 30, 2012.
The affirmation of NFR's B3 CFR reflects its increased reserve and
production scale that is much larger than most B3 rated peers,
offset by its higher financial leverage and natural gas exposure
relative to its peers. Moody's negative outlook is based on the
company's higher leverage metrics, tight liquidity and the
execution risk of meeting its liquids production growth forecasts
on the acquired properties.
NFR will continue to operate with minimal cash balances and
limited revolver availability. Revolver availability is expected
to be about $120 million following the closing of the acquisitions
and related debt funding, and that availability will decline
further over the course of 2013 absent increases in the borrowing
base. NFR has a high proportion of its 2013 natural gas production
hedged at $5.23/mcfe and has meaningful natural gas hedging in
2014. The company plans to hedge a high percentage of expected oil
production to provide further cash flow certainty in 2013.
The ratings for NFR could be downgraded if its capital
productivity on the acquired properties does not yield the
forecasted production and cash flow growth necessary to reduce its
leverage metrics. The ratings could also be downgraded if the
company's liquidity were to decline below $50 million on a
sustained basis through a reduction in its borrowing base or
higher than expected revolver borrowings in 2013. The outlook
could be returned to stable if oil and NGL production growth
forecasts are met and NFR's liquidity is meaningfully increased.
Given the company's size, cash and available borrowing capacity
over $150 million with good covenant headroom would provide a more
comfortable level of liquidity. A ratings upgrade is unlikely in
2013 given the increased leverage and execution risk on the
acquired properties.
The Caa1 rating on the $500 million senior secured second-lien
term loan and the Caa2 rating on the $350 million senior notes
reflects both the overall probability of default of NFR, to which
Moody's assigns a PDR of B3, and loss given defaults of LGD 4, 59%
and LGD 5, 89% (changed from LGD 5, 71%). Following this
transaction, the company expects to have a $525 million borrowing
base under its $750 million senior secured revolving credit
facility. The senior secured credit facility will have a priority
claim to substantially all of the company's assets. The term loan
will have a second-lien secured claim to the company's assets
while the senior notes are unsecured. Therefore the second-lien
term loan and senior notes are rated one notch and two notches,
respectively, beneath the B3 CFR under Moody's Loss Given Default
Methodology.
The principal methodology used in rating NFR Energy was the Global
Independent Exploration and Production Industry Methodology
published in December 2011. Other methodologies used include Loss
Given Default for Speculative-Grade Non-Financial Companies in the
U.S., Canada and EMEA published in June 2009.
NFR Energy LLC is a privately held independent exploration and
production company based in Houston, Texas. The company is in the
process of changing its name to Sabine Oil & Gas LLC and nearly
all of the equity in its parent company is owned by private equity
funds advised by First Reserve Corporation.
NFR ENERGY: S&P Revises Outlook on 'B' CCR to Stable
----------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Houston-
based NFR Energy LLC to stable from negative and affirmed its 'B'
corporate credit rating on the company.
"At the same time, we assigned our 'B' issue-level rating and '4'
recovery rating to the company's proposed $500 million second lien
term loan. The '4' recovery rating indicates our expectation of
average (30% to 50%) recovery for lenders in the event of a
default. We are also lowering our issue rating on NFR's existing
senior unsecured notes to 'CCC+' from 'B-' and revising the
recovery rating to these notes to '6' from '5'. The '6' recovery
rating indicates our expectation of negligible (0% to 10%)
recovery for lenders in the event of a default," S&P said.
"The rating action follows the announcement of NFR acquiring
properties in the Anadarko Basin from TLP Energy LLC and certain
assets of two independent oil and gas companies in the Eagle Ford
funded through a combination of debt and equity," said Standard &
Poor's credit analyst Ben Tsocanos. "The acquisition enables the
company to lessen its concentration in the East Texas region and
enhance its production mix that would help improve its cash flow
generation and liquidity. Concurrently, First Reserve Corp. also
plans to purchase 100% of Nabors Industries Ltd.'s (BBB/Stable/--)
equity interest in NFR, resulting in sole ownership of First
Reserve Corp. in NFR Energy LLC's parent, NFR Holdings LLC."
"The ratings on NFR Energy LLC reflect our view of its
'vulnerable' business risk profile, 'aggressive' financial risk
profile, and 'adequate' liquidity position. The ratings
incorporate NFR's operations in the volatile oil and natural gas
industry, its small size and scope of operations, limited
geographic diversity and our expectations of increasing share of
oil and natural gas liquids (NGLs; together, 'liquids') in the
production mix," S&P said.
"The stable outlook reflects our expectation that the company's
leverage will improve to about 4x by the end of 2013, which is
acceptable for the current ratings category. We would consider a
downgrade if NFR faces constrained liquidity, or if the company
becomes more aggressive to achieve its growth through debt,
resulting in total debt to EBITDA exceeding 5x. We would consider
an upgrade if NFR achieves its growth objectives while maintaining
leverage in the 4x range or lower, manage capital spending closer
to its operating cash flows and maintain adequate liquidity," S&P
said.
NIELSEN HOLDINGS: S&P Puts 'BB' CCR on Watch Neg. on Arbitron Pact
------------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on U.S.-
based global information and measurement company Nielsen Holding
N.V. on CreditWatch with negative implications. This includes the
'BB' corporate credit rating on both Nielsen and wholly owned
subsidiary The Nielsen Co. B.V., as well as all issue-level
ratings on the company's debt.
"This action follows the company's announcement that it has
entered into a definitive agreement to acquire Columbia, Md.-based
Arbitron Inc. for about $1.3 billion in cash. The move sets back
the company's progress of the last two years toward lower
leverage. We also view the acquisition as consuming significant
financial resources without furthering the development of, and
position in, Internet audience measurement. Instead, the
transaction increases the company's exposure to traditional media
(radio and television). We view radio, in particular, as under
long-term structural pressure that we think could hamper Nielsen's
ability to obtain rate increases on its services. Adjusted
leverage will rise to slightly over 5x on a pro forma basis based
on Sept 30, 2012 financials if the transaction is fully funded
with debt, as we anticipate," S&P said.
"We will resolve the CreditWatch listing after evaluating the
company's future capital allocation plan, specifically its ability
to reduce leverage to below 5x on a sustained basis. If leverage
were to remain above 5x, we would likely lower the rating by one
notch, to 'BB-'," S&P said.
NORTHCORE TECHNOLOGIES: Appoints J. Moskos as Interim CEO
---------------------------------------------------------
The Irish Government Health Service Executive (The HSE) employed
the Northcore E-Buyer Tender Submission and Procurement Auction
Software Service to achieve a dramatic 30% saving on a EUR30
million procurement tender process.
This groundbreaking achievement was the subject of a prominent
information piece on the Irish National business news network RTE
One.
The HSE team that worked with Northcore on the project
subsequently received the Irish National Procurement Award for
Innovation in Public Procurement.
Northcore has also completed development of a comprehensive
Material Management software application that has wide application
in many industries including the Oil & Gas and Healthcare sectors.
Additionally, James Moskos has been appointed to the role of
Interim Chief Executive Officer of Northcore Technologies.
New Customers
Northcore launched a new customer web destination through its
portfolio company Envision Online Media Inc.
Northcore has acquired Envision, an Ottawa based software
development company. Envision has been one of the most respected
boutique solutions providers in the National Capital Area for over
a decade and brings a complementary product and skill set to
Northcore.
The customer, BluMetric Environmental, is an integrated products
and service organization providing intelligent solutions to
complex environmental problems in Canada and abroad.
The new web platform, accessible at www.blumetric.ca provides a
comprehensive resource base for clients and investors.
Stakeholders can quickly navigate information on the Company's
project history and service offerings. Additionally, investors
are able to review the Company's quarterly results and an upcoming
events calendar.
"BlueMetric is a great new addition to our growing portfolio of
client partners," said Jim Moskos, interim CEO of Northcore
Technologies. "Congratulations to the team at Envision for
continuing their record of delivering high quality products to
fully satisfied customers."
Another customer, International Brotherhood of Electrical Workers
Construction Council of Ontario, is an agency serving over 14,000
men and women working in various electrical sectors: Industrial,
Commercial and Institutional, Maintenance, Residential,
Communications, Linework and Renewable Energy/Solar. The IBEW CCO
is actively involved in protecting its membership, enforcing
health and safety, and securing market share through education and
awareness.
The new web platform, accessible at www.ibewcco.org, will serve as
a 'springboard' for anyone who is interested in becoming an IBEW
CCO member, as well as providing existing members with a
comprehensive resource of information related to courses, services
and industry news.
"We are pleased to welcome the IBEW CCO to our growing list of
client partners," said James Moskos, Interim CEO of Northcore
Technologies. "Our team at Envision has quickly become a leader
in the delivery of Content Management Solutions to associations
and agencies."
About Northcore Technologies
Toronto, Ontario-based Northcore Technologies Inc. (TSX: NTI; OTC
BB: NTLNF) -- http://www.northcore.com/-- provides a Working
Capital Engine(TM) that helps organizations source, manage,
appraise and sell their capital equipment. Northcore offers its
software solutions and support services to a growing number of
customers in a variety of sectors including financial services,
manufacturing, oil and gas and government.
Northcore owns 50% of GE Asset Manager, LLC, a joint business
venture with GE. Together, the companies work with leading
organizations around the world to help them liberate more capital
value from their assets.
The Company reported a loss and comprehensive loss of
C$3.93 million in 2011, compared with a loss and comprehensive
loss of C$3.03 million in 2010.
The Company's balance sheet at Sept. 30, 2012, showed C$3.49
million in total assets, C$1.27 million in total liabilities and
C$2.21 million in total shareholders' equity.
NORTHSTAR AEROSPACE: Wants Purchasers to Comply with Sale Order
---------------------------------------------------------------
NSA (USA) Liquidating Corp., et al., and Fifth Third Bank, as
agent for the prepetition secured lenders, ask the U.S. Bankruptcy
Court for the District of Delaware to:
1. enforce the sale order against the purchasers;
2. order the US Purchaser to direct that The Private Bank
release the funds deposited into escrow with the bank to cover any
cure costs due in respect of the lease;
3. order the purchasers to account for pre-paid inventory
received to date and pay the Inventory price thereof (estimated to
be $469,429) and continue to account for and reimburse vendors for
the inventory price of future deliveries of pre-paid inventory;
4. order the purchasers to pay the refunded deposits in the
amount of $20,111 to the vendors; and
5. order the purchasers to provide the vendors with access to
all of their books and records, including without limitation the
corporate drive and other historical pre-closing records, relating
to the pre-closing period.
The parties relate that on July 24, 2012, the Court issued an
order approving the Northstar Agreement of Purchase and Sale and
the sale of substantially all of the US Vendors' assets to the US
purchaser in conjunction with the sale of substantially all of the
Canadian Vendors' assets to the Canadian purchaser. Since the
sale order was entered, the purchasers have failed to satisfy
several material obligations under the sale order and the APA.
According to the parties, relief must be granted because, among
other things:
-- the sale order was entered after extensive negotiations
between NSA (Chicago) Liquidating Corp., tenant, the US purchaser
and the KTR Chitown I LLC, the landlord, regarding the extent of
tenant's cure obligation under a lease from the landlord that was
to be assigned to the US purchaser. In clear violation of the
sale order, however, the US purchaser subsequently asserted that
tenant owes an additional cure amount of $363,346 related to real
estate tax obligations of the landlord that were not due and
payable by tenant under the lease prior to the closing date.
-- The purchasers failed to reimburse vendors for certain (a)
eligible post-filing deposit arrangements assumed by the
purchasers from the vendors, and (b) inventory pre-payments made
by vendors prior to the closing date within 5 business days after
the receipt of the covered inventory. The vendors believe that
the purchasers owe a total of $20,111 for eligible deposits that
were not assumed by the purchasers and $469,429 for pre-paid
inventory, based on expected inventory delivery dates, out of a
total $869,732 inventory pre-payment reimbursement obligation.
-- The purchasers have not provided the vendors with complete
access to all of their books and records, including without
limitation the internal financial statements, the corporate drive
and other historical pre-closing records, relating to the pre-
closing period, which has hindered the vendors' ability to, among
other things, prepare all necessary tax returns and wind up
their estates.
-- The Chicago cure cost escrow must be released to tenant.
About Northstar Aerospace
Headquartered in Chicago, Illinois, Northstar Aerospace --
http://www.nsaero.com/-- is an independent manufacturer of flight
critical gears and transmissions. With operating subsidiaries in
the United States and Canada, Northstar produces helicopter gears
and transmissions, accessory gearbox assemblies, rotorcraft drive
systems and other machined and fabricated parts. It also provides
maintenance, repair and overhaul of components and transmissions.
Its plants are located in Chicago, Illinois; Phoenix, Arizona and
Milton and Windsor, Ontario. Northstar employs over 700 people
across its operations.
Northstar Aerospace, along with affiliates, filed for Chapter 11
protection (Bankr. D. Del. Lead Case No. 12-11817) in Wilmington,
Delaware, on June 14, 2012, to sell its business to affiliates of
Wynnchurch Capital, Ltd., absent higher and better offers.
The names of the Debtors were changed as contemplated by the
approved sale transaction.
Attorneys at SNR Denton US LLP and Bayard, P.A. serve as counsel
to the Debtors. The Debtors have obtained approval to hire Logan
& Co. Inc. as the claims and notice agent.
Certain Canadian affiliates are also seeking protection pursuant
to the Companies' Creditors Arrangement Act, R.S.C.1985, c. C-36,
as amended.
As of March 31, 2012, Northstar disclosed total assets of
$165.1 million and total liabilities of $147.1 million.
Approximately 60% of the assets and business are with the U.S.
debtors.
No creditors' committee has been appointed in the cases. No
trustee or examiner has been appointed.
NORTHWESTERN STONE: Files Third Amended Reorganization Plan
-----------------------------------------------------------
Northwestern Stone, LLC, filed a third amended reorganization plan
dated Nov. 21, 2012.
Under the third amended plan, the Debtor will continue to be
operated by its owners, Richard and Sharel Bakken, who will
continue to be compensated at a rate of $3,000 and $1,473.23 per
week. Michael Bakken will continue to be employed as the Debtor's
Operations Manager and will continue to be compensated at his pre-
petition rate of $2,807.69 per week. To effectuate the proposed
Plan upon confirmation the Debtor will utilize rents profits,
revenues, income from operations and cash on hand on the Effective
Date.
The Plan proposes 15 classes of creditors including secured
creditors, taxing authorities, unsecured creditors, and equity
holders. It proposes to pay these creditors in full within five
years of confirmation. To effectuate the Plan, some creditors are
to be paid out of the reorganized Debtor's revenues, while others
are to be paid from the proceeds of the sale of a quarry located
in Middleton, Wisconsin.
Within 5 days of the Effective date the Debtor will grant to the
Liquidating Trust for the benefit of all allowed unsecured claim,
the note and mortgage and lien. The Debtor has listed the
Middleton Quarry for sale. Although the Debtor has not been able
to sell the property, the Debtor, McFarland State Bank, and
members of the official Creditors Committee believe market
conditions continue to improve and that the Debtor will be able to
liquidate the quarry, in whole or in part, within three years of
the Confirmation Date, and that by doing so, pay claims as called
for by this Plan in full.
Upon receiving any Offer to Purchase and upon the removal of all
contingencies, the Reorganized Company will notify the Trustee of
the impending sale of the Middleton Quarry. The Trustee will then
calculate the amount owed to each allowed Class 14 claimant to the
anticipated date of closing. That total will be provided to the
Reorganized Company so as to allow that amount to be paid directly
to the Trustee at closing, subject to senior liens. The Trustee
shall in turn pay the amount due to each Class 14 claimant. If
the amount available for payment is less than 100%, then the costs
and fess of the Liquidating Trust and the Liquidating Trustee
shall be paid in full, and all allowed claims of the beneficiaries
of the Liquidating Trust shall be paid pro rata.
On the Effective Date, the Liquidating Trust will be created
pursuant to the Liquidating Trust Agreement, and the Liquidating
Trustee will be Claire Ann Resop. The Liquidating Trust will be
organized for the purposes of making the distributions required
under the Plan.
On the Effective Date, Debtors will grant the Liquidating Trust a
lien against the Debtor's Middleton quarry, Mt. Horeb quarry,
machinery and equipment, excluding titled motor vehicles, to
secure payment of the full amount of all allowed Class 14
Claimants and costs of the Liquidating Trust.
A copy of the third amended plan is available for free at:
http://bankrupt.com/misc/NORTHWESTERN_STONE_plan_3amended.pdf
About Northwestern Stone
Middleton, Wisconsin-based Northwestern Stone, LLC, operates a
gravel quarry business at four separate locations: one in
Sauk County (Swiss Valley Road, Prairie de Sac), and three in Dane
County (4373 Pleasant View Road, Middleton, 6166 Ramford Court,
Springfield, and 3060 Getz Road, Springdale). It filed for
Chapter 11 bankruptcy protection (Bankr. W.D. Wis. Case No.
10-19137) on Dec. 16, 2010. The Debtor disclosed $25,238,172 in
assets and $12,080,628 in liabilities as of the Chapter 11 filing.
Nicole I. Pellerin, Esq., and Timothy J. Peyton, Esq., at Kepler &
Peyton, in Madison, Wisconsin, serve as the Debtor's bankruptcy
counsel. Grobe & Associates, LLP, serves as the Debtor's
accountants.
On Jan. 26, 2011, the U.S. Trustee appointed the Official
Committee of Unsecured Creditors. Claire Ann Resop, Esq., and
Eliza M. Reyes, Esq., at von Briesen & Roper, s.c., in Madison,
Wisconsin, represent the Committee as counsel.
NPS PHARMACEUTICALS: Adopts Majority Votes for Director Nominees
----------------------------------------------------------------
NPS Pharmaceuticals, Inc.'s Board of Directors amended Sections
3.2.5 of its Amended and Restated Bylaws to adopt majority voting
with respect to nominees for the Board of Directors at any meeting
at which quorum is present and whereas of that date there are not
more nominees than the number of directors to be elected.
About NPS Pharmaceuticals
Based in Bedminster, New Jersey, NPS Pharmaceuticals Inc. (Nasdaq:
NPSP) -- http://www.npsp.com/-- is developing new treatment
options for patients with rare gastrointestinal and endocrine
disorders.
NPS reported a net loss of $36.26 million in 2011, a net loss of
$31.44 million in 2010 and a net loss of $17.86 million in 2009.
The Company's balance sheet at Sept. 30, 2012, showed $165.46
million in total assets, $212.20 million in total liabilities and
a $46.74 million total stockholders' deficit.
NRG ENERGY: Fitch Affirms 'B+' Issuer Default Ratings
-----------------------------------------------------
Fitch Ratings has affirmed the Issuer Default Ratings (IDRs) of
NRG Energy, Inc. at 'B+' and downgraded the IDR of GenOn Energy,
Inc. (GenOn) to 'B-' from 'B'. Fitch's rating actions follow
completion of the merger of GenOn into NRG. Fitch has also
downgraded the IDRs of GenOn Americas Generation, LLC (GAG) and
GenOn Mid-Atlantic, LLC's (GMA) to 'B' from 'B+'. GAG and GMA are
intermediate holding company subsidiaries of GenOn.
Fitch has removed NRG and GenOn entities from Rating Watch
Negative. The Rating Outlook is Stable for NRG and the GenOn
entities.
Fitch has determined that a weak linkage relationship exists
between NRG and GenOn and, therefore, the IDRs are being assigned
to NRG and GenOn based on the respective standalone credit
profiles. As an excluded project subsidiary of NRG, GenOn
exhibits no specific, tangible legal ties with the parent. GenOn
and its subsidiaries do not guarantee NRG's debt nor any
downstream guarantees flow from NRG to GenOn or its subsidiaries.
There are no cross default provisions between NRG's debt and the
debt at GenOn entities and GenOn's debt is excluded from covenant
calculation of NRG's debt.
Operational ties are limited by a shared services agreement
between NRG and GenOn that is expected to allocate a significant
proportion of the synergy benefits to NRG. The absence of common
treasury and an arm's length bilateral credit agreement between
NRG and GenOn further limits the level of operational integration
between the two entities. Fitch does deem GenOn to hold strategic
importance for NRG, which is the basis of the merger transaction.
Any demonstrated tangible support by NRG towards GenOn, such as
equity infusion or intercompany loans could lead to ratings to be
more closely linked in the future.
NRG's ratings are supported by a stronger post-merger business
profile, successful execution of an integrated wholesale/retail
model in Texas, a strong liquidity position, and the company's
historically conservative hedging strategy, which has enabled it
to generate strong FCF despite a persistently weak commodity
environment. GenOn's generation portfolio lends geographic
diversity, size and scale benefits to NRG's fleet. GenOn's
northeast and western generation assets can provide physical
backup to NRG's retail aspirations in these markets, thereby
lowering costs to compete.
NRG's other growth initiatives have been measured and largely
driven by renewable and repowering projects, whose economics are
well supported by long-term power purchase agreements and/ or low
cost to entry. NRG has aggressively expanded into solar projects
over the last couple of years. Fitch views NRG's current solar
strategy as credit neutral.
Fitch expects the consolidated credit profile for NRG to be
modestly weaker post-merger through 2015. GenOn's financial
profile weakens in 2015 with the loss of above market hedges and
lower capacity payments. The planned $1 billion debt reduction
(of which ~$800 million has been completed) and $300 million of
forecasted synergies and interest cost savings for the combined
entity provide only a partial offset. Fitch anticipates NRG's
consolidated funds from operations (FFO)-to-debt to be in the 13%-
14% range and Debt/adjusted EBITDA to be approximately 5.25x or
higher by 2015, which is modestly weaker compared to Fitch's
guideline metrics of 15% FFO to debt and 5.0x Debt/adjusted EBITDA
for a high-risk 'B+' rated issuer. These credit metrics reflect
deconsolidation of the three large solar projects that NRG is
pursuing with a conditional loan guarantee from the Department of
Energy (DOE), i.e. the Ivanpah, Agua Caliente, and California
Valley Solar Ranch projects.
Liquidity at NRG remains strong. As of Sept. 30, 2012, NRG had
$2.7 billion of adjusted liquidity, which reflects unrestricted
cash and cash equivalents of $1.6 billion and revolver
availability of $1.1 billion. Fitch expects NRG to generate
upwards of $600 million in free cash flow in 2014. The free cash
flow outlook would continue to strengthen in Fitch's view driven
by factors such as gradual increase in natural gas prices, heat
rate expansion due to tightening supply conditions in regions such
as Texas and higher capacity prices in the Northeast driven by
planned and anticipated coal plants retirements. In this context,
management's future capital allocation policies will be a key
ratings driver for NRG.
The one-notch downgrade in the IDRs of GenOn, GAG and GMA
primarily reflects the significant deterioration in credit metrics
versus Fitch's expectations as a result of the sharp secular fall
and anticipated tepid recovery in natural gas prices. Lower than
expected capacity payments, compressed dark spreads, expiring
above market hedges, and deactivations and planned retirements of
a portion of its coal fleet are exerting considerable pressure on
GenOn's cash flows. Despite the $686 million in debt reduction as
a result of the merger, the capital structure remains highly
leveraged. Fitch anticipates GenOn's FFO-to-debt to be in the 7-
9% range and Debt/adjusted EBITDA to be approximately 7.5x by
2015.
GenOn's ratings are supported by strong liquidity that provides
cushion to sustain a prolonged trough in power prices. GenOn had
approximately $1.7 billion of cash and cash equivalents as of
Sept. 30, 2012 prior to the pay down of the $686 million term
loan. Liquidity is further supported by the $500 million
bilateral credit agreement with NRG. Fitch has withdrawn the
senior secured debt rating at GenOn due to the pay down of the
senior secured term loan and the elimination of the $788 million
bank credit facility.
The Stable Outlooks for NRG and the GenOn entities reflect strong
liquidity to withstand a sustained period of depressed natural gas
prices, manageable debt maturities, and greater diversity in
generation portfolio post-merger. Fitch also expects that the
merger integration will be executed successfully and a large
proportion of anticipated synergy benefits will be realized.
Recovery Analysis:
The individual security issue ratings at NRG, GenOn, GMA and GAG
are notched above or below the IDR, as a result of the relative
recovery prospects in a hypothetical default scenario. Fitch
values the power generation assets that support the entity level
debt using a net present value analysis. The generation asset net
present values vary significantly based on future gas price
assumptions and other variables, such as the discount rate and
heat rate forecasts in ERCOT, Northeast, Southeast and California.
For the net present valuation of generation assets used in Fitch's
recovery valuation case, Fitch uses the plant valuation provided
by its third-party power market consultant, Wood Mackenzie, as an
input as well as Fitch's own gas price deck and other assumptions.
Fitch calculates the value of NRG's retail business by applying a
multiple to EBITDA expectations.
What Could Trigger A Rating Action:
-- Positive rating actions on NRG, GenOn, GMA and GAG are not
contemplated at this time.
-- Significant deterioration in power prices: A significant
worsening of the commodity environment could drive negative
rating actions for NRG and the GenOn entities.
-- Capital allocation strategy: Capital allocation decisions by
management will be key ratings driver for NRG. Large
shareholder friendly actions without commensurate debt
reduction could lead to negative rating actions. An
aggressive growth strategy focused on expansion of merchant
generation assets would also be a cause for concern.
-- Environmental compliance: Trends in environment regulation
are also a key ratings driver given the still high coal
exposure of the combined portfolio.
Fitch has affirmed the following ratings:
NRG Energy, Inc.
-- IDR at 'B+';
-- Senior secured term loan B at 'BB+/RR1';
-- Senior secured revolving credit facility at 'BB+/RR1';
-- Senior unsecured notes at 'BB/RR2';
-- Convertible preferred stock at 'B-/RR6'.
GenOn Energy, Inc.
-- Short-term IDR at 'B'.
Fitch has downgraded the following ratings:
GenOn Energy, Inc.
-- IDR to 'B-' from 'B';
-- Senior unsecured notes to 'B+/RR2' from 'BB-/RR2'.
GenOn Americas Generation, LLC
-- IDR to 'B' from 'B+';
-- Senior unsecured notes to 'BB-/RR2' from 'BB/RR2'.
GenOn Mid-Atlantic, LLC
-- IDR to 'B' from 'B+';
-- Pass-through certificates to 'BB-/RR2' from 'BB/RR2'.
The Rating Outlook is Stable for all of the above ratings.
Fitch has withdrawn the following ratings:
GenOn Energy, Inc.
-- Senior secured term loan B at 'BB/RR1';
-- Senior secured revolver at 'BB/RR1'.
OIL STATES: Moody's Rates $300-Mil. Sr. Unsecured Notes 'Ba3'
-------------------------------------------------------------
Moody's Investors Service assigned a Ba3 rating to Oil States
International, Inc. (OIS) proposed $300 million senior unsecured
notes. OIS' other ratings and positive outlook remained unchanged.
Net proceeds from the note offering will be used primarily to
reduce borrowings under OIS' US revolving credit facility and to
fund the acquisition of Tempress Technologies for roughly $52.5
million, which was announced on December 17, 2012.
"These transactions together, will enhance liquidity at the
expense of slightly higher near term debt burden," said Sajjad
Alam, Moody's Analyst. " OIS is still expecting to finance its
2013 growth expenditures with internal cash flow and cash on hand
and maintain a solid leverage profile."
Issuer: Oil States International, Inc.
Assignments:
US$300M Senior Unsecured Regular Bond/Debenture, Assigned Ba3
US$300M Senior Unsecured Regular Bond/Debenture, Assigned a
range of LGD5, 75 %
Upgrades:
US$600M 6.5% Senior Unsecured Regular Bond/Debenture,
Upgraded to a range of LGD5, 75 % from a range of LGD5, 80 %
Ratings Rationale
The new notes will rank equally in right of payment with OIS'
existing 6.50% notes due 2019 and have substantially similar terms
and conditions. Consequently both notes are rated at the same Ba3
level. The existence of significant amount of priority ranking
secured credit facilities in the capital structure results in the
unsecured notes being rated one notch below the Ba2 CFR, under
Moody's Loss Given Default Methodology. As is the case with the
6.50% notes, the new notes do not have guarantees from OIS'
Canadian and Australian subsidiaries.
OIS' Ba2 Corporate Family Rating (CFR) reflects its large scale
integrated accommodation service operations in Canada and
Australia that generate stable revenues under long-term contracts,
diversified service offerings to the oil and gas industry, global
scope of its growing offshore services business serving the more
durable deeper water markets, and solid leverage. The rating also
considers the anticipated aggressive growth in the accommodations
segment through 2013 and the associated capital spending and
execution risks, the inherent volatility in the North American
drilling capex cycle, as well as the exposure to the boom-and-bust
nature of the Canadian oil sands and Australian mining industries.
The positive outlook captures the likelihood of further earnings
driven improvement in leverage that could be sustained at low
levels.
The rating could be upgraded to Ba1 if OIS can manage its
aggressive growth plan mostly with operating cash flow, continue
its conservative financial policies and maintain the debt/EBITDA
ratio below 1.5x.
The rating could be lowered if leverage (Debt / EBITDA) remains
elevated above 3.0x over an extended period.
The principal methodology used in rating OIS was the Global
Oilfield Services Industry Methodology published in December 2009.
Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.
Oil States International, Inc., headquartered in Houston, Texas,
manufactures, owns, and operates housing accommodations for the
oil and gas and mining industries, provides oilfield services for
North American onshore exploration and production companies, and
manufactures and services products used in offshore oil and gas
exploration and production.
OIL STATES: S&P Raises CCR to 'BB+'; Rates New $300MM Notes 'BB+'
-----------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit and
senior unsecured ratings on Houston-based Oil States international
Inc. (OIS) to 'BB+' from 'BB'. The outlook is stable.
"At the same time, we assigned our 'BB+' issue-level rating (same
as the corporate credit rating) and '4' recovery rating to Oil
States' proposed $300 million senior unsecured notes. The '4'
recovery rating indicates our expectation of average (30% to 50%)
recovery for lenders in the event of a payment default," S&P said.
"The upgrade is based on our expectation that the company will
maintain its positive operating momentum as well as credit
measures appropriate for the new rating category," said Standard &
Poor's credit analyst Christine Besset. "Although market
conditions in the oilfield services industry have weakened in
2012, we expect the company's resilient accommodation segment and
its strong backlog in offshore products to support profitability
and cash flow in the near to medium term. Based on our assumption
of a modest contraction of revenues of 7% and stable EBITDA margin
of 19.5% in 2013, as well as capital expenditures estimates of
$730 million, debt to EBITDA should be about 1.5x at year-end
2013. We forecast that it would take more than a 50% decline in
EBITDA for this ratio to approach our downgrade trigger of 3x. We
believe the main risks to our forecasts remain the possibility of
a large, debt-financed acquisition; however, the company's recent
strategy has focused on organic growth for its accommodation
segment and small, bolt-on acquisition for its other businesses."
"The ratings on Oil States International Inc. (OIS) continue to
reflect the company's "fair" business risk profile, which benefits
from the relative stability provided by the company's
accommodations business, strong demand for its offshore products,
and international diversity that adds a buffer to the more
volatile North American market. The business risk also reflects
exposure to more cyclical well site services, and low-margin
tubular services segments' exposure to the inherent volatility of
onshore and offshore drilling activity. Finally, OIS benefits from
some product diversification among its four business segments and
the good near-term growth prospects for its accommodations
business segment. In addition, ratings also reflect OIS'
'significant' financial risk profile, which reflects our
expectation that OIS will maintain strong credit measures through
market cycles despite the company's growth strategy. In addition,
our ratings reflect OIS' 'strong' liquidity and moderate debt
leverage," S&P said.
"In its accommodations business, OIS provides housing and related
services to field workers in proximity to oilfield and mining
sites primarily in Canada, Australia, and the U.S. We believe that
OIS' higher-margin accommodations business segment, which
represents more than half of the company's EBITDA, provides
stability to its overall operations. The company's customer base
typically has long-term operations in key, remote Canadian oil
sands and Australian mining regions, which result in recurring
accommodation needs. Long-term contracts with minimum commitments
and inflationary cost protection provide OIS' accommodations
segment with good revenue and cash flow visibility. As of Dec. 14,
OIS had 90% of its lodge and village rooms committed for 2013. OIS
also has a degree of operating flexibility and low operating
leverage in this segment, allowing it to modestly reduce costs and
capital expenditures, should demand decline. Still, we believe
that the company's operations remain vulnerable to a decrease in
oil and gas capital investment, particularly if oil prices
experience a substantial and prolonged decline," S&P said.
"The stable outlook reflects our expectation that OIS' more-stable
accommodations business should mitigate the cyclicality of its
other operations, and that the company will be able to grow this
business without jeopardizing its credit metrics. We would
consider a downgrade if leverage increases above 3x on a
persistent basis, most likely due to deteriorating operating
results such that revenues fall by 20% and EBITDA margins contract
below 15%. Additionally, a large debt financed acquisition could
cause us to reassess OIS' financial policy and resulting ratings.
We consider an upgrade unlikely within the next 12 months due to
the limited scale of operations and business diversity relative to
investment-grade peers, as reflected in the current business risk
profile," S&P said.
OPEN RANGE: Ch. 7 Trustee Inks Deal With Lender to Resolve Claim
----------------------------------------------------------------
Lance Duroni at Bankruptcy Law360 reports that Open Range
Communications Inc.'s Chapter 7 trustee minted a settlement
Tuesday that resolves a $6 million claim from the private equity
investor that bankrolled its failed reorganization, removing the
last obstacle holding up the defunct broadband company's
liquidation.
One Equity Partners III LP, Open Range's majority shareholder and
debtor-in-possession lender, has agreed to waive its DIP loan
claim in return for $700,000 and half of the estate's future
recoveries in preference litigation, Bankruptcy Law360 relates
citing a settlement motion filed by trustee Charles M. Forman in
Delaware bankruptcy court.
About Open Range
Greenwood Village, Colo.-based Open Range Communications Inc., a
provider of wireless broadband services to 26,000 rural customers
in 12 states, filed a Chapter 11 petition (Bankr. D. Del. Case No.
11-13188) on Oct. 6, 2011, to either sell the business or shut
down and liquidate. Open Range disclosed about $115.1 million in
assets and $102.8 million in debts. Open Range started its WiMax
broadband and voice service in late 2009, backed by a $267 million
loan from the U.S. Department of Agriculture's Rural Utility
Service and $100 million invested by One Equity Partners, a
financing arm of JPMorgan Chase & Co.
Judge Kevin J. Carey presides over the case. Marion M. Quirk,
Esq., at Cole, Schotz, Meisel, Forman & Leonard, serves as
bankruptcy counsel. Logan & Co. serves as claims agent. FTI
Consulting, Inc., provided a chief restructuring officer, Michael
E. Katzenstein; an associate chief restructuring officer, Chris
Lewand; and hourly temporary staff. The petition was signed by
Chris Edwards, chief financial officer.
In December 2011, Open Range shut down operations after failing to
get the broadcast spectrum it needed, problems with network
quality and vendors, and the "sporadic" flow of money from a
$267 million federal loan, of which Open Range owes a balance of
$73.5 million.
Open Range hired RB Capital LLC and Heritage Global Partners Inc.
as auctioneers and sales agents to conduct an auction of the
assets.
In February 2012, the Debtor obtained an order converting the case
to Chapter 7 liquidation. The Debtor said it was unlikely to have
a reorganization plan resolving the Internet provider's potential
claims against the U.S. Department of Agriculture over a
$267 million loan. Charles Forman was appointed Chapter 7
trustee.
ORCHARD SUPPLY: Incurs $53.6-Mil. Net Loss in Q3 Ended Oct. 27
--------------------------------------------------------------
Orchard Supply Hardware Stores Corporation filed its quarterly
report on Form 10-Q, reporting a net loss of $53.6 million on
$155.2 million of net sales for the 13 weeks ended Oct. 27, 2012,
compared with a net loss of $10.1 million on $158.7 million of net
sales for the 13 weeks ended Oct. 29, 2011.
The net loss in the third quarter of fiscal 2012 includes a pre-
tax non-cash impairment charge of $60.3 million related to trade
names, a pre-tax non-cash charge of $4.8 million for store
impairment, and litigation charges and other expenses of $1.1
million.
For the 39 weeks ended Oct. 27, 2012, the Company had a net loss
of $84.8 million on $504.2 million of net sales, compared with a
net loss of $7.2 million on $518.9 million of net sales for the 39
weeks ended Oct. 29, 2011.
The Company's balance sheet at Oct. 27, 2012, showed
$484.7 million in total assets, $482.2 million in total
liabilities, and stockholders' equity of $2.5 million.
According to the regulatory filing, the uncertainties surrounding
the Company's ability to replace or modify the Senior Secured Term
Loan with its lenders, and the consequences of its inability to
replace or amend the Senior Secured Term Loan or obtain an
additional waiver of the anticipated leverage covenant violation
raise substantial doubt about the Company's ability to continue as
a going concern.
A copy of the Form 10-Q is available at http://is.gd/CzHjRG
San Jose, Calif.-based Orchard Supply Hardware Stores Corporation
operates neighborhood hardware and garden stores focused on paint,
repair and the backyard. The Company was founded as a purchasing
cooperative in San Jose in 1931. As of Oct. 27, 2012, the Company
had 89 stores in California.
OVERSEAS SHIPHOLDING: Seeks Approval of Bankruptcy Advisors
-----------------------------------------------------------
Overseas Shipholding Group's official committee of unsecured
creditors filed with U.S. Bankruptcy Court motions to retain:
-- Akin Gump Strauss Hauer & Feld (Contact: Daniel H.
Golden) as co-counsel at these hourly rates: partner at
$570 to 1,200, senior counsel and counsel at $425 to
$865, associate at $350 to $630 and paraprofessional at
$130 to $315;
-- Houlihan Lokey Capital (Contact: David R. Hilty) as
financial advisor and investment banker for a monthly fee
of $175,000 and a deferred fee of $3.25 million;
-- FTI Consulting (Contact: Andrew Scruton) as financial
advisor at these hourly rates: senior managing director
at $780 to $895, director and managing director at $560
to $745, consultant and senior consultant at $280 to
$530 and administrative/paraprofessional/associate at
$115 to $250; and
-- Pepper Hamilton (Contact: David B. Stratton) as co-counsel
at these hourly rates: partner, special counsel and counsel
at $430 to $750, associate at $260 to $440 and
paraprofessional at $190 to $250.
About Overseas Shipholding
Overseas Shipholding Group, Inc., headquartered in New York, is
one of the largest publicly traded tanker companies in the world,
engaged primarily in the ocean transportation of crude oil and
petroleum products. OSG owns or operates 111 vessels that
transport oil and petroleum products throughout the world.
Overseas Shipholding Group and 180 affiliates filed voluntary
Chapter 11 petitions (Bankr. D. Del. Lead Case No. 12-20000) on
Nov. 14, 2012. Bankruptcy Judge Peter J. Walsh oversees the case.
Greylock Partners LLC Chief Executive John Ray serves as chief
reorganization officer. Cleary Gottlieb Steen & Hamilton LLP
serves as OSG's Chapter 11 counsel, while Chilmark Partners LLC
serves as financial adviser. Kurtzman Carson Consultants LLC will
provide certain administrative services.
The Debtors disclosed $4.15 billion in assets and $2.67 billion in
liabilities as of June 30, 2012. Liabilities include $1.49
billion on an unsecured credit agreement with DNB Bank ASA as
agent. In addition to the secured Chinese loan, there is $518
million in unsecured notes and debentures plus $267 million on
ship mortgages taken down to finance nine vessels.
The Export-Import Bank of China, owed $312 million used for the
construction of five tankers, is represented by Louis R. Strubeck,
Jr., Esq., and Kristian W. Gluck, Esq., at Fulbright & Jaworski
LLP in Dallas; David L. Barrack, Esq., and Beret Flom, Esq., at
Fulbright & Jaworski in New York; and John Knight, Esq., and
Christopher Samis, Esq., at Richards Layton & Finger PA. Chilmark
Partners, LLC serves as financial and restructuring advisor.
Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed a
five-member official committee of unsecured creditors in the case
of Overseas Shipholding Group Inc.
PACIFIC RIM: Incurs $1.4-Mil. Net Loss in Fiscal Second Quarter
---------------------------------------------------------------
Pacific Rim Mining Corp. reported a net loss of $1.4 million for
the three months ended Oct. 31, 2012, compared with a net loss of
$783,000 for the three months ended Oct. 31, 2011.
For the six months ended Oct. 31, 2012, the Company had a net loss
of $1.9 million, compared with a net loss of $571,000 for the six
months ended Oct. 31, 2011.
The Company's balance sheet at Oct. 31, 2012, showed $9.7 million
in total assets, $2.0 million in total liabilities, and
shareholders' equity of $7.7 million.
Going Concern Uncertainty
In the Notes to Interim Consolidated Financial Statements for the
three months ended Oct. 31, 2012, which has been prepared by
management of the Company, Pacific Rim noted that there are events
and conditions that raise substantial doubt about the Company's
ability to continue as a going concern.
"During the six months ended Oct. 31, 2012, the Company had a loss
of $1,909,000 and as at Oct. 31, 2012, has an accumulated deficit
of $91,724,000 and a working capital of $2,292,000. The Company
will require additional funding to maintain its ongoing
exploration programs and property commitments, for administrative
purposes and for the arbitration and legal costs related to the
case under the El Salvador's Foreign Investment Law between the
Company and the Government of El Salvador, which is being ICSID.
The legal and arbitration costs for the case are substantial.
A copy of the Interim Consolidated Financial Statements for the
second quarter ended Oct. 31, 2012, is available at:
http://is.gd/068hEt
Vancouver-based Pacific Rim Mining Corp. is mineral exploration
company focused on high grade, environmentally clean gold deposits
in the Americas. Pacific Rim's primary asset is the advanced-
stage, vein-hosted El Dorado gold deposit in El Salvador, where
the Company also owns several grassroots gold projects. The
Company additionally holds a joint venture option on the Hog Ranch
epithermal gold project in Nevada and is actively pursuing
additional exploration opportunities elsewhere in the Americas.
The El Dorado project is the subject of an arbitration claim
(being heard at the International Center for the Settlement of
Investment Disputes ("ICSID") at the World Bank. During Q1 2013
the Arbitration was given permission by ICSID to proceed, under
the Investment Law of El Salvador, to its final phase wherein the
merits of the claim will finally be addressed at ICSID
headquarters in Washington, D.C. Notwithstanding the ongoing
legal action, the Company continues to seek a negotiated
resolution to the El Dorado permitting impasse and to resuming its
advancement of the El Dorado project.
PEAK RESORTS: Asks Court to Approve Fresh FDIC Financing
--------------------------------------------------------
Marie Beaudette at Dow Jones' DBR Small Cap reports that upstate
New York ski resort Greek Peak is asking a bankruptcy judge to
approve some extra financing from the Federal Deposit Insurance
Corp. as unseasonably warm weather puts a damper on its revenue.
About Peak Resorts
Peak Resorts, Inc., dba Greek Peak Mountain Resort, and four
affiliates filed for Chapter 11 bankruptcy (Bankr. N.D.N.Y. Case
Nos. 12-31471 to 12-31473, 12-31475 and 12-31476) in Syracuse on
Aug. 1, 2012. The affiliates are Hope Lake Investors LLC,
V.R.P.D. II L.P., REDI LLC, and A.R.K. Enterprises Inc.
Peak Resorts owns 888.5 acres of real estate, including the "Greek
Peak Mountain Resort", a four-season resort development located in
Virgil, New York. The 888.5-acre property is located 8 miles from
Cortland, New York and has the largest day trip area in Central
New York state. REDI LLC owns 402.7 acres of adjacent property.
Hope Lake Investors owns the Hope Lake Lodge & Cascades Indoor
Water Park, a 151-room hotel and resort facility in Virgil,
Cortland County. The Debtors have a total of 264 employees.
Chief Bankruptcy Judge Robert E. Littlefield Jr. presides over the
case. Lawyers at Harris Beach PLLC serve as the Debtors' counsel.
The Debtors scheduled these assets and debts:
Scheduled Assets Scheduled Liabilities
---------------- ---------------------
Hope Lake $27,180,635 $48,800,528
Peak Resorts $12,991,230 $26,558,438
REDI, LLC $1,298,401 $3,851,808
The petitions were signed by Allen R. Kryger, president.
QUANTUM CORP: Capital Research No Longer Owns Shares
----------------------------------------------------
In an amended Schedule 13G filing with the U.S. Securities and
Exchange Commission, Capital Research Global Investors disclosed
that, as of Nov. 30, 2012, it does not beneficially own any shares
of common stock of Quantum Corporation. Capital Research
previously reported beneficial ownership of 18,279,499 common
shares or a 7.8% equity stake as of Dec. 30, 2011. A copy of the
amended filing is available for free at http://is.gd/9Aqyis
About Quantum Corp.
Based in San Jose, California, Quantum Corp. (NYSE:QTM) --
http://www.quantum.com/-- is a storage company specializing in
backup, recovery and archive. Quantum provides a comprehensive,
integrated range of disk, tape, and software solutions supported
by a world-class sales and service organization.
The Company reported a net loss of $8.81 million for the fiscal
year ended March 31, 2012, compared with net income of
$4.54 million during the prior year.
The Company's balance sheet at Sept. 30, 2012, showed
$345.76 million in total assets, $413.45 million in total
liabilities and a $67.68 million total stockholders' deficit.
RCS CAPITAL: Krynski Steps Down From Creditor's Committee
---------------------------------------------------------
Kenneth S. Krynski has resigned from the Official Committee of
Unsecured Creditors in the bankruptcy case of RCS Capital
Development, LLC, according to a notice filed in court mid-
November.
As reported by the Troubled Company Reporter on Dec. 12, 2012,
Judge Randolph J. Haines has confirmed the plan of reorganization
filed by RCS Capital. The Second Amended Disclosure Statement
explaining the Fourth Amended Plan of Reorganization provides that
City of North Las Vegas, holder of a $293,000 secured claim, will
receive proceeds from the sale of property in West Ann Road, in
North Las Vegas. The remaining proceeds of the property,
estimated to be worth not less than $500,000, will be paid for the
claims of other classes. With respect to Hill Crest Bank, a
secured creditor, the Debtor would convey to Hill Crest the
properties at South Valley View, and Simmons Properties to Hill
Crest. Unsecured creditors other than ABC Learning Centres are
impaired although they are expected to be paid in full using the
remaining proceeds from the Ann Road Sale the Debtor's profit
participation in the property at East Russell Road, in Las Vegas.
ABC Learning's unsecured claim is unimpaired under the Plan.
Owners of the Debtor will retain their equity interests.
RCS Capital Development, LLC, et al., filed a Chapter 11 petition
(Bankr. D. Ariz. Case No. 11-28746) on Oct. 12, 2011. Michael W.
Carmel, Esq., at Michael W. Carmel, Ltd., in Phoenix, Ariz.,
represents the Debtor as counsel.
RCS's bankruptcy schedules reflect assets of US$57,038,210, of
which the largest is a judgment in the approximate amount of
US$57,000,000 against ABC Learning Centres Ltd., an Australia-
based operator of childcare centers. RCS's bankruptcy schedules
reflect liabilities of approximately of US$47,169,203, the most
significant of which is the disputed US$41,000,000 claim of ABC.
Judge Randolph J. Haines presides over RCS's case.
RCS had various contractual relationships with ABC that resulted
in litigation in Maricopa County. That litigation resulted in a
US$50 million jury verdict against ABC and judgment (worth
US$56,456,732 as of Nov. 15, 2011). Liquidators for ABC filed for
recognition under Chapter 15 of the Bankruptcy Code in the U.S.
Bankruptcy Court for the District of Delaware about two weeks
after RCS obtained its verdict. Judge Kevin Gross entered an
order on Nov. 16, 2010, that recognized the Chapter 15 proceeding.
ABC liquidators contended in papers filed in Delaware that RCS
violated the Chapter 15 order by continuing actions in Nevada to
seize property in which the liquidators claimed an interest. At a
hearing in U.S. Bankruptcy Court in Delaware on Oct. 4, 2011, the
liquidators asked Judge Gross to rule that RCS violated the
automatic stay. The liquidators also wanted RCS to be held in
contempt, directed to return property and assessed with punitive
damages. Judge Gross concluded the Oct. 4, 2011 hearing and said
he would rule later.
To preclude Judge Gross from handing down an unfavorable ruling,
RCS filed its own Chapter 11 petition on Oct. 12, 2011.
READER'S DIGEST: Moody's Cuts CFR to 'Caa3'; Outlook Negative
-------------------------------------------------------------
Moody's Investors Service downgraded Reader's Digest Association
Inc.'s ("RDA") Corporate Family Rating (CFR) and Senior Secured
Notes to Caa3 from Caa1. The Probability of Default Rating was
also changed to Caa3 from Caa1. The outlook remains negative.
RDA's Senior Secured Term Loan and Unsecured Term Loan are not
rated. The downgrade reflects continuing weak performance driven
by economic conditions as well as negative secular trends, the
resulting increase in leverage that may lead to an unsustainable
capital structure, and a weakened liquidity position exacerbated
by the need for an amendment of its term loan facility.
A summary of the ratings actions are listed below:
Issuer: Reader's Digest Association, Inc.
Corporate Family Rating, Downgraded to Caa3 from Caa1
Probability of Default Rating, Downgraded to Caa3 from Caa1
Senior Secured Note due February 2017, Downgraded to Caa3 (LGD-4
56%) from Caa1 (LGD-4 57%)
SGL-4 Liquidity rating is unchanged
Outlook remains negative
Ratings Rationale
RDA's Caa3 CFR reflects weak revenue and earnings performance for
the first three quarters of 2012 and expectations that performance
will continue to be weak going forward, the corresponding increase
in leverage, and the need for an amendment of its financial
covenants for its secured term loan that was put in place in March
2012. A weak interest coverage ratio, a poor liquidity position,
and a history of negative free cash flow are also reflected in the
rating. Results have declined even though some of the businesses
that generated poor performance last year, such as its Lifestyle &
Entertainment division and Every Day with Rachael Ray magazine
have been sold. Revenues declined in all of its divisions over the
past nine month period, caused primarily by lower response rates
to its marketing campaigns in international markets and secular
declines in its magazine business in North America. The company's
results for the full year are largely determined by the upcoming
4th quarter which Moody's expects will be difficult given the
current economic environment in Europe and changing consumer
preferences. RDA's direct marketing division will be challenged to
update its product offerings away from its traditional focus on
books, music and videos that are being impacted by newer media
alternatives for consumers.
The company derives a degree of support from its large customer
base and mailing list as well as its flagship brand name. Efforts
to license its international direct marketing operations may
provide urgently needed near term cash to boost its weakened
liquidity position and reduce the amount of restricted cash needed
to manage the business. If RDA is unsuccessful in raising
additional sources of liquidity, the company could potentially
default on its debt obligations.
RDA's liquidity is weak as indicated by Moody's SGL-4 liquidity
rating. While the sale of its Allrecipes.com business in Q1 2012
generated $175 million of proceeds, the cash was used to address
near term debt maturities and a $60.6 million repurchase of its
secured notes. The company has a cash balance of $88 million as of
9/30/12 ($59 million of which is held by foreign subsidiaries),
but the required cash to run its international operations are
substantial ($50 to $60 million) and the company does not have
access to a revolver. Poor operating performance has impacted its
free cash flow that is anticipated to be materially negative in FY
2012 and is expected to lead to a covenant violation of its $50
million secured term loan. If the company is unable to amend its
covenants, it may not have the resources necessary to repay the
debt without additional sources of liquidity. The company's
business model has highly seasonal cash needs, particularly in Q1
and Q3 of each year. Efforts to license its direct marketing
operations could reduce its working capital needs, the amount of
cash required to run the business, and provide urgently needed
liquidity.
The outlook remains negative given Moody's expectations for near
term operating performance and the challenges of improving results
in a difficult global economic environment. Economic conditions in
Europe, a dated product offering, and secular declines in the US
magazine industry will provide serious challenges for the company.
RDA's liquidity position could prove insufficient and trigger a
default if it is unable to generate new sources of liquidity or if
it faces unanticipated cash requirements.
An upgrade is not likely in the near term given the recent
downgrade.
A downgrade would occur if it increasingly appeared likely that a
restructuring was imminent due to poor performance or if it's
unable to achieve success with its licensing of its direct
marketing business. A downgrade would also occur if it appeared
likely that the company may not be able to service its debt
balances or was unable to maintain the liquidity needed to operate
the business.
The principal methodology used in rating Reader's Digest was the
Global Publishing Industry Methodology published in December 2011.
Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.
Reader's Digest Association Inc., headquartered in New York City,
is a global media and direct marketing company that markets books,
magazine, recorded music collections, home video products and
other products worldwide. Pro-forma Revenues for LTM 9/30/12
totaled $1.2 billion. RDA emerged from Chapter 11 bankruptcy in
February 19, 2010.
RESIDENTIAL CAPITAL: Noteholders Balk at Request to Tap Mediator
-----------------------------------------------------------------
Stephanie Gleason at Daily Bankruptcy Review reports that
Residential Capital LLC's noteholders are objecting to the
company's request for continued exclusive control of its Chapter
11 case and the appointment of a mediator, saying that ResCap has
"squandered" the time it's had so far.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion. The sale of the assets,
subject to satisfaction of customary closing conditions including
certain third party consents, is expected to close in the first
quarter of 2013.
The partnership of Ocwen and Walter defeated the last bid of $2.91
billion from Fortress Investment Group's Nationstar Mortgage
Holdings Inc., which acted as stalking horse bidder, at an auction
that began Oct. 23, 2012. The $1.5 billion offer from Warren
Buffett's Berkshire Hathaway Inc. was declared the winning bid for
a portfolio of loans at the auction on Oct. 25.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000 ).
RESIDENTIAL CAPITAL: Rejecting Frost Servicing Agreement
--------------------------------------------------------
Residential Capital LLC and its affiliates are currently in the
process of evaluating which of their contracts and leases should
be assumed and assigned to the purchasers of their assets or
assumed to facilitate their wind down activities. The Debtors
determined that certain contracts and leases are burdensome to the
estate, will not be assigned to the Purchasers, and are no longer
needed for the wind down of their business operations.
Accordingly, the Debtors seek the Court's authority to reject
these contracts and leases effective as of Nov. 30, 2012:
Counterparty Description of Contract/Lease
------------ -----------------------------
Frost National Bank Servicing Agreement June 30, 2000
PVP Holdings JV, LLC Lease, dated Dec. 12, 2003
If any of the Debtors has deposited funds with the counterparty
to a Rejected Contract as a security deposit or other arrangement,
the Debtors ask that that counterparty may not set off or
otherwise use the deposit without the prior authority of the Court
or agreement between the counterparty and the Debtors. The
Debtors assert that the rejection of the Rejected Contracts is
reasonable and represents an appropriate exercise of sound
business judgment.
Contracts/Leases Rejection Procedures
In a separate filing, the Debtors ask the Court to approve
procedures for the future rejection of executory contacts and
unexpired leases.
The Debtors propose to file with the Court a notice of proposed
rejection, which will also be served to notice parties. A party-
in-interest has 14 days from service to object to the Debtors'
proposed rejection. If no objection is timely filed and served,
the applicable contract or lease will be deemed rejected on the
effective date set forth in the rejection notice. If a timely
objection is filed, a hearing will be scheduled to resolve the
objection.
Claims arising out of Rejected Contracts must be filed with
Kurtzman Carson Consultants, the Court-approved claims processing
agent, on or before the later of (i) the deadline for filing
proofs of claim established by the Court in the Debtors' cases,
or (ii) 45 days after the Rejection Date. If no proof of claim
is timely filed, that claimant will be forever barred from
asserting a claim for rejection damages and from participating in
any distributions that may be made in connection with
these Chapter 11 cases.
If any of the Debtors has deposited funds with the counterparty
to a Rejected Contract as a security deposit or other arrangement,
that counterparty may not set off or otherwise use such deposit
without the prior authority of the Court or agreement between the
counterparty and the Debtors.
The Debtors also seek Court authority, prior to and through the
Rejection Date, to remove, in their sole discretion, from
premises that are the subject of any rejected lease, consistent
with their ownership rights or other property interests therein,
personal property that they have installed in or about the leased
premises, which property is either owned by the Debtors, leased
by the Debtors from third parties, or subject to any equipment
financing agreements with third parties.
Moreover, to the extent that the Debtors determine that any of
their interest in any property has little or no value or that the
preservation thereof will be burdensome to their estates compared
with the expense of removing and storing the property, the
Debtors seek authority to abandon, in their sole discretion, the
property remaining at a premises subject to a rejected lease as
of the Rejection Date.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion. The sale of the assets,
subject to satisfaction of customary closing conditions including
certain third party consents, is expected to close in the first
quarter of 2013.
The partnership of Ocwen and Walter defeated the last bid of $2.91
billion from Fortress Investment Group's Nationstar Mortgage
Holdings Inc., which acted as stalking horse bidder, at an auction
that began Oct. 23, 2012. The $1.5 billion offer from Warren
Buffett's Berkshire Hathaway Inc. was declared the winning bid for
a portfolio of loans at the auction on Oct. 25.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: AIG Wants RMBS Fraud Claims Classification
---------------------------------------------------------------
AIG Asset Management (U.S.), LLC and its affiliated entities, as
holders of general unsecured claims against Residential Capital
and its affiliated debtors, ask Judge Martin Glenn to determine
that, for purposes of any Chapter 11 plan concerning the Debtors,
(i) the "Misrepresentation Claims" and the "R&W Claims" should be
classified together, and (ii) the Misrepresentation Claims cannot
be classified in a class of claims that are subject to Section
510(b) of the Bankruptcy Code.
The Investors all hold residential mortgage-backed securities
that were marketed by the Debtors and issued by bankruptcy remote
trusts established by, but not affiliated with, the Debtors. An
RMBS Certificate entitles the holder to a capped share of the
cash flows coming from a pool of mortgage loans. Payments from
homeowners/borrowers in respect of the Mortgage Loans flow
through bankruptcy-remote trusts to holders of RMBS Certificates.
Representing the Investors, Susheel Kirpalani, Esq., at Quinn
Emanuel Urquhart & Sullivan, LLP, in New York, tells the Court
that the AIG entities' request seeks to ensure that equal
treatment is given to all creditors that were harmed by
misrepresentations made by the Debtors relating to the RMBS
Certificates.
The R&W Claims are contract-based claims that arise under the
transactional documents entered into as part of the securitization
process between the Debtors and the Trusts. Mr. Kirpalani
explains that in these transactional documents, the Debtors made
certain misrepresentations about the quality of the Mortgage
Loans. The R&W Claims are the subject of the proposed RMBS Trust
Settlement pending before the Court for approval.
The Misrepresentation Claims arise from the same
misrepresentations by the Debtors, but are based on violations of
federal securities laws and state blue sky laws, common law fraud
and other similar theories. Mr. Kirpalani says the Debtors'
misrepresentations gave rise to the approximately $1.78 billion
in fraudulent-inducement and similar claims by the Investors.
Because both sets of claims arise out of the same conduct and are
for the benefit of similarly situated claimants, the Investors
seek to ensure that the Misrepresentation Claims are given equal
treatment with the R&W Claims.
Specifically, the Investors ask the Court to confirm that the
Misrepresentation Claims must be classified in the same class as
the R&W Claims. The Investors also ask the Court to clarify that
the Misrepresentation Claims cannot be placed in a plan class
that will be subordinated under Section 510(b), which applies
only to claims based on securities "of" the Debtors or their
"affiliates." Section 510(b), according to Mr. Kirpalani, is not
applicable to the Misrepresentation Claims, because the RMBS
Certificates at issue are not securities "of" the Debtors or
their "affiliates." The RMBS Certificates, he asserts, represent
only obligations of the non-debtor Trusts to pass through funds
received from homeowner-borrowers.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion. The sale of the assets,
subject to satisfaction of customary closing conditions including
certain third party consents, is expected to close in the first
quarter of 2013.
The partnership of Ocwen and Walter defeated the last bid of $2.91
billion from Fortress Investment Group's Nationstar Mortgage
Holdings Inc., which acted as stalking horse bidder, at an auction
that began Oct. 23, 2012. The $1.5 billion offer from Warren
Buffett's Berkshire Hathaway Inc. was declared the winning bid for
a portfolio of loans at the auction on Oct. 25.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: Panel Can Hire SilvermanAcampora as Counsel
----------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in the
Chapter 11 case of Residential Capital LLC won the Bankruptcy
Court's authority to retain SilvermanAcampora LLC as special
counsel, nunc pro tunc to Oct. 25, 2012.
The firm will represent the Committee with respect to issues and
matters that may arise relating to former and current borrowers
of the Debtors. SilvermanAcampora will assist individual
borrowers regarding the Chapter 11 process and developments in
the Chapter 11 cases. The firm will also communicate with
borrowers and their counsel about borrower-specific issues.
SilvermanAcampora will be paid in accordance with its customer
hourly rates: $95 to $195 for paraprofessionals and $295 to $650
for attorneys. SilvermanAcampora will also be reimbursed for any
necessary out-of-pocket expenses.
Ronald J. Friedman, Esq., a member of the firm SilvermanAcampora
LLP, in New York, assures the Court that his firm is a
"disinterested person" as the term is defined in Section 101(14)
of the Bankruptcy Code and does not represent any interest
adverse to the Committee's.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion. The sale of the assets,
subject to satisfaction of customary closing conditions including
certain third party consents, is expected to close in the first
quarter of 2013.
The partnership of Ocwen and Walter defeated the last bid of $2.91
billion from Fortress Investment Group's Nationstar Mortgage
Holdings Inc., which acted as stalking horse bidder, at an auction
that began Oct. 23, 2012. The $1.5 billion offer from Warren
Buffett's Berkshire Hathaway Inc. was declared the winning bid for
a portfolio of loans at the auction on Oct. 25.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: Papas Fails in Bid for Ch. 7 Conversion
------------------------------------------------------------
The Bankruptcy Court denied Paul Papas' request for the conversion
of Residential Capital LLC's bankruptcy case to a Chapter 7 case
"for reasons stated in open court."
According to Judge Martin Glenn, Mr. Papas' Motion is frivolous
and sets forth no evidentiary or legal support for conversion of
the Debtors' Chapter 11 cases to Chapter 7. To the extent Mr.
Papas submits any additional filings to renew the motion or seeks
similar relief on alternate grounds, he may be subject to
sanctions, Judge Glenn opined.
As reported in the Aug. 15, 2012 edition of the Troubled Company
Reporter, Mr. Papas alleged the company "acted in bad faith" when
it attempted to sell properties it does not own. He said the
properties the company is trying to sell at a public auction are
not listed in its statement of assets and liabilities.
In response, the Debtors argued that the Court should deny the
Motion because it is not supported by facts or evidence. The
Debtors strongly object to any suggestion that their Chapter 11
cases were filed in bad faith. They point out that the Court has
already ruled that the cases were filed in good faith. At a
recent hearing, the Court noted that various parties have filed
motions in the Debtors' cases to dismiss the Chapter 11 cases that
are "never supported by any evidence, just assertions that the
cases were filed in bad faith. Everything that has occurred in
the Debtors' cases since the petition date would establish to the
contrary.
The Debtors submit that further oversight in Chapter 7 is
unnecessary and unwarranted. The Court has already appointed an
Examiner to oversee the Debtors' Chapter 11 cases. In addition,
liquidation in Chapter 7 would not provide the maximum return to
creditors that the filing of the Chapter 11 cases and the
Debtors' sale of their assets will provide. Thus, the Debtors
ask the Court to deny the Motion.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion. The sale of the assets,
subject to satisfaction of customary closing conditions including
certain third party consents, is expected to close in the first
quarter of 2013.
The partnership of Ocwen and Walter defeated the last bid of $2.91
billion from Fortress Investment Group's Nationstar Mortgage
Holdings Inc., which acted as stalking horse bidder, at an auction
that began Oct. 23, 2012. The $1.5 billion offer from Warren
Buffett's Berkshire Hathaway Inc. was declared the winning bid for
a portfolio of loans at the auction on Oct. 25.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: Farr Sues GMAC Mortgage, et al.
----------------------------------------------------
Michael A. Farr sued GMAC Mortgage LLC and other unknown
defendants seeking declaratory judgment on the issues of ownership
and proper title of a property located at 3950 Parian Ridge Road,
in Atlanta, Georgia. Mr. Farr asserted that the property should
be vested in him free and clear inasmuch as GMAC cannot show valid
ownership interest in a security deed or note or proper transfers,
assignments or allonges and do not possess the actual instruments.
The case is Michael A. Farr v. GMAC Mortgage, LLC, et al., Case
No. 12-01899 (S.D.N.Y.).
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion. The sale of the assets,
subject to satisfaction of customary closing conditions including
certain third party consents, is expected to close in the first
quarter of 2013.
The partnership of Ocwen and Walter defeated the last bid of $2.91
billion from Fortress Investment Group's Nationstar Mortgage
Holdings Inc., which acted as stalking horse bidder, at an auction
that began Oct. 23, 2012. The $1.5 billion offer from Warren
Buffett's Berkshire Hathaway Inc. was declared the winning bid for
a portfolio of loans at the auction on Oct. 25.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: Dist. Court Stays Maciel Lawsuit vs. GMAC
--------------------------------------------------------------
In view of GMAC Mortgage, LLC's bankruptcy filing, District Judge
Edward M. Chen stays all proceedings in the lawsuit, MARTHA
MACIEL, et al., Plaintiffs, v. GMAC MORTGAGE, LLC, Defendant, No.
C-12-3030 EMC (N.D. Calif.). All hearing dates, including a
Dec. 11 hearing to consider the Defendant's motion to dismiss,
are vacated, pending termination of the automatic stay under 11
U.S.C. Sec. 362(a) or a determination by the United States
District Court for the Southern District of New York that the
Plaintiffs may proceed with the lawsuit notwithstanding the
automatic stay. The lawsuit disputes title and ownership of the
Plaintiff's home on a variety of bases, including allegedly
invalid securities transactions, failures to properly disclose
required information to the Plaintiffs, and placing the
Plaintiffs in a loan they could not afford. A copy of the
Court's Dec. 4, 2012 Order is available at http://is.gd/AUgVzd
from Leagle.com.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion. The sale of the assets,
subject to satisfaction of customary closing conditions including
certain third party consents, is expected to close in the first
quarter of 2013.
The partnership of Ocwen and Walter defeated the last bid of $2.91
billion from Fortress Investment Group's Nationstar Mortgage
Holdings Inc., which acted as stalking horse bidder, at an auction
that began Oct. 23, 2012. The $1.5 billion offer from Warren
Buffett's Berkshire Hathaway Inc. was declared the winning bid for
a portfolio of loans at the auction on Oct. 25.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RICHFIELD EQUITIES: Court Okays Quarton as Investment Banker
------------------------------------------------------------
The Hon. Daniel S. Opperman of the U.S. Bankruptcy Court for the
Eastern District of Michigan has granted Richfield Equities,
L.L.C., et al., authorization to employ Quarton Partners as their
investment banker to perform investment banker and other sale
related services that will necessary during the Chapter 11 cases.
Quarton Partners will assist and advise the Debtor with respect
to: (i) the preparation and distribution of confidentiality
agreements and appropriate descriptive selling materials designed
to generate additional interest in the Company; (ii) the
initiation of discussions and negotiations with prospective merger
partners or purchasers; and (iii) the various details necessary to
complete a successful transaction.
About Richfield Equities
Richfield Equities, L.L.C., Richfield Landfill, Inc., Richfield
Management, L.L.C., and Waste Away Disposal, L.L.C., each filed
voluntary petitions for relief under Chapter 11 of the Bankruptcy
Code (Bankr. E.D. Mich. Case Nos. 12-33788 to 12-33791) on
Sept. 18.
Flint, Mich.-based Richfield Equities is a limited liability
company that directly owns 100% of the ownership interests of each
of Richfield Landfill, Richfield Management, and Waste Away
Disposal. Debtors are a vertically-integrated solid waste
collection, transfer, disposal, and recycling company that service
the southeast, central/mid, and "thumb" regions of Michigan. The
Debtors' operations include two (2) landfills, two (2) transfer
stations, and collection and hauling operations.
The Debtors' consolidated balance sheet shows that as of April 30,
2012, the Debtors had total assets of approximately $37.1 million
and total liabilities of approximately $41.8 million.
As of the Petition Date, the total outstanding principal amount
owed to Comerica Bank was approximately $18 million plus
contingent reimbursement obligations of $8.3 million under
applications for letters of credit issued by the Bank. The
obligations under the Prepetition Credit Documents are secured by
substantially all of the assets of the Debtors and were guaranteed
by each of Landfill, Management, and Waste Away, as well as other
non-debtor individuals and non-operating entities.
Joseph M. Fischer, Esq., Robert A Weisberg, Esq., and Christopher
A. Grosman, Esq., at Carson Fischer PLC, in Bloomfield Hills,
Michigan, represent the Debtors as counsel.
Wolfson Bolton PLLC represents the Official Committee of Unsecured
Creditors of Richfield Equities, L.L.C., et al., as counsel.
Judge Daniel S. Opperman oversees the cases.
The Debtors' cases are jointly administered, for procedural
purposes only, under Case No. 12-33788, which is the case number
assigned to Richfield Equities, L.L.C.
RITZ CAMERA: Asks Court OK to Convert Case to Chapter 7
-------------------------------------------------------
Joshua Alston at Bankruptcy Law360 reports that Ritz Camera &
Image LLC asked a Delaware court on Thursday to convert its
Chapter 11 bankruptcy protection to a Chapter 7 bankruptcy, which
will effectively end the nation's largest specialty camera chain
just five years shy of its centennial.
The Chapter 7 hearing is scheduled for Jan. 15, and, if approved,
Ritz will be cleared to appoint a trustee to liquidate its
remaining assets after spending the year struggling to find a path
back to solvency, according to Bankruptcy Law360.
About Ritz Camera
Beltsville, Maryland-based Ritz Camera & Image LLC --
http://www.ritzcamera.com-- sold digital cameras and
accessories, and electronic products. It sought Chapter 11
protection (Bankr. D. Del. Case No. 12-11868) on June 22, 2012, to
close unprofitable stores. Ritz claims to be the largest camera
and image chain the U.S., operating 265 camera stores in 34 states
as well as an Internet business. When it filed for bankruptcy,
Ritz Camera intended to shut 128 locations and cut its staff in
half. Included in the closing are 10 locations in Maryland and 4
in Virginia.
Affiliate Ritz Interactive Inc., owner e-commerce Web sites that
include RitzCamera.com and BoatersWorld.com, also filed for
bankruptcy.
RCI's predecessor, Ritz Camera Centers, Inc., sought Chapter 11
protection (Bankr. D. Del. Case No. 09-10617) on Feb. 22, 2009.
Ritz generated $40 million by selling all 129 Boater's World
Marine Centers. A group that included the company's chief
executive officer, David Ritz, formed Ritz Camera & Image to buy
at least 163 of the remaining 375 camera stores. The group paid
$16.25 million in cash and a $7.8 million note. Later, Ritz sold
a $4 million account receivable for $1.5 million to an owner of
the company that owed the debt.
In the 2009 petition, Ritz disclosed total assets of $277 million
and total debts of $172.1 million. Lawyers at Cole, Schotz,
Meisel, Forman & Leonard, P.A., served as bankruptcy counsel.
Thomas & Libowitz, P.A., served as the Debtor's special corporate
counsel and conflicts counsel. Marc S. Seinsweig, at FTI
Consulting, Inc., served as the Debtor's chief restructuring
officer. Kurtzman Carson Consultants LLC acted as claims and
noticing agent. Attorneys at Cooley Godward Kronish LLP and
Bifferato LLC represented the official committee of unsecured
creditors as counsel.
In April 2010, the Court approved a liquidating Chapter 11 plan
proposed by the company and the official creditor's committee.
Under the Plan, unsecured creditors were to recover 4% to 14% of
their claims.
Ritz Camera disclosed $43,692,961 in assets and $49,147,316 in
liabilities as of the Chapter 11 filing. The Debtors owe not less
than $16.32 million for term and revolving loans provided by
secured lenders led by Crystal Finance LLC, as administrative
agent.
Attorneys at Cole, Schotz, Meisel, Forman & Leonard, P.A., serve
as bankruptcy counsel. Kurtzman Carson Consultants LLC is the
claims agent.
WeinsweigAdvisors LLC's Marc Weinsweig has been appointed as
Ritz's CRO.
Mark L. Desgrosseilliers, Esq., and Ericka F. Johnson, Esq., at
Womble Carlyle Sandridge & Rice, LLP, represent liquidators Gordon
Brothers Retail Partners LLC and Hilco Merchant Resources LLC.
Crystal Finance, the DIP lender, is represented by Morgan, Lewis &
Bockius and Young Conaway Stargatt & Taylor LLP.
Roberta A. DeAngelis, U.S. Trustee for Region 3, pursuant to
Section 1102(a)(1) of the Bankruptcy Code, appointed six persons
to Official Committee of Unsecured Creditors.
RITZ CAMERA: Has OK to Hire Hilco to Sell Topeka, Kansas Property
-----------------------------------------------------------------
The Hon. Kevin Gross of the U.S. Bankruptcy Court for the District
of Delaware has granted Ritz Camera & Image L.L.C., et al.,
authorization to employ Hilco Real Estate, LLC, as exclusive real
estate agent for the sale of certain real property located in
Topeka, Kansas; and waive certain reporting requirements.
As reported by the Troubled Company Reporter on Nov. 9, 2012, the
Court authorized on Aug. 24, 2012, the employment of Hilco IP
Services, LLC, doing business as Hilco Streambank, to serve as
exclusive sales and marketing agent to the Debtors for non-core
intellectual property. On Sept. 25, 2012, the Court authorized
the expansion of services of Hilco Streambank, to serve as
exclusive sale and marketing agent for core intellectual property.
The Debtors are liquidating their remaining assets. The Debtors
determined that the sale of the real property separate from the
sale processes for the Debtors' other remaining assets is the best
way to maximize the sale price of the real property.
About Ritz Camera
Beltsville, Maryland-based Ritz Camera & Image LLC --
http://www.ritzcamera.com-- sold digital cameras and
accessories, and electronic products. It sought Chapter 11
protection (Bankr. D. Del. Case No. 12-11868) on June 22, 2012, to
close unprofitable stores. Ritz claims to be the largest camera
and image chain the U.S., operating 265 camera stores in 34 states
as well as an Internet business. When it filed for bankruptcy,
Ritz Camera intended to shut 128 locations and cut its staff in
half. Included in the closing are 10 locations in Maryland and 4
in Virginia.
Affiliate Ritz Interactive Inc., owner e-commerce Web sites that
include RitzCamera.com and BoatersWorld.com, also filed for
bankruptcy.
RCI's predecessor, Ritz Camera Centers, Inc., sought Chapter 11
protection (Bankr. D. Del. Case No. 09-10617) on Feb. 22, 2009.
Ritz generated $40 million by selling all 129 Boater's World
Marine Centers. A group that included the company's chief
executive officer, David Ritz, formed Ritz Camera & Image to buy
at least 163 of the remaining 375 camera stores. The group paid
$16.25 million in cash and a $7.8 million note. Later, Ritz sold
a $4 million account receivable for $1.5 million to an owner of
the company that owed the debt.
In the 2009 petition, Ritz disclosed total assets of $277 million
and total debts of $172.1 million. Lawyers at Cole, Schotz,
Meisel, Forman & Leonard, P.A., served as bankruptcy counsel.
Thomas & Libowitz, P.A., served as the Debtor's special corporate
counsel and conflicts counsel. Marc S. Seinsweig, at FTI
Consulting, Inc., served as the Debtor's chief restructuring
officer. Kurtzman Carson Consultants LLC acted as claims and
noticing agent. Attorneys at Cooley Godward Kronish LLP and
Bifferato LLC represented the official committee of unsecured
creditors as counsel.
In April 2010, the Court approved a liquidating Chapter 11 plan
proposed by the company and the official creditor's committee.
Under the Plan, unsecured creditors were to recover 4% to 14% of
their claims.
Ritz Camera disclosed $43,692,961 in assets and $49,147,316 in
liabilities as of the Chapter 11 filing. The Debtors owe not less
than $16.32 million for term and revolving loans provided by
secured lenders led by Crystal Finance LLC, as administrative
agent.
Attorneys at Cole, Schotz, Meisel, Forman & Leonard, P.A., serve
as bankruptcy counsel. Kurtzman Carson Consultants LLC is the
claims agent.
WeinsweigAdvisors LLC's Marc Weinsweig has been appointed as
Ritz's CRO.
Mark L. Desgrosseilliers, Esq., and Ericka F. Johnson, Esq., at
Womble Carlyle Sandridge & Rice, LLP, represent liquidators Gordon
Brothers Retail Partners LLC and Hilco Merchant Resources LLC.
Crystal Finance, the DIP lender, is represented by Morgan, Lewis &
Bockius and Young Conaway Stargatt & Taylor LLP.
Roberta A. DeAngelis, U.S. Trustee for Region 3, pursuant to
Section 1102(a)(1) of the Bankruptcy Code, appointed six persons
to Official Committee of Unsecured Creditors.
ROTECH HEALTHCARE: Steven Alsene Named CEO and President
--------------------------------------------------------
Rotech Healthcare Inc. appointed Steven P. Alsene as President and
Chief Executive Officer of the Company effective Jan. 1, 2013.
Steve Alsene was also appointed to the Board of Directors. Philip
L. Carter will continue to serve as a member of the Board of
Directors.
Arthur J. Reimers, Chairman of the Board of Directors of the
Company, commented that the Board conducted a search for the Chief
Executive Officer position and that the Board is pleased to
announce Mr. Alsene's appointment. Mr. Alsene has interacted
closely with the Board for many years, has earned the respect of
the Board, and was the natural choice to become Chief Executive
Officer.
Mr. Reimers also thanked Mr. Carter for his years of service to
the Company. "He has guided the Company through many challenges
and we are grateful for his dedicated service to the Company. We
now look forward to his continued service as a Director of the
Company."
As previously reported, Mr. Carter notified the Company in June
2012 of his intention to retire as President and Chief Executive
Officer on Dec. 31, 2012. In August 2011, the Company amended Mr.
Carter's employment agreement specifically in contemplation of Mr.
Carter's future retirement and to provide for an orderly
succession plan.
Mr. Carter, President and CEO, commented that Mr. Alsene is well
positioned to take on the leadership role at Rotech. At various
times in his tenure at Rotech, Mr. Alsene has had all of the key
functions including Sales, Operations, Billing, Finance, and
Information Technology report to him. Mr. Carter continued that
he expects this transition of leadership to be smooth, orderly,
and well received by Company employees.
Mr. Alsene joined Rotech in June 2003 as the Vice President of
Internal Audit and also served as Vice President of Finance before
becoming Chief Financial Officer and Treasurer in September 2006.
Most recently, he became Chief Operating Officer of the Company on
Jan. 1, 2012. From June 1999 to June 2003, Mr. Alsene was the
Head of Corporate Audit Services of Harcourt Education, a division
of Reed Elsevier PLC. From 1992 to 1999, Mr. Alsene served in
various audit department capacities including audit manager with
PricewaterhouseCoopers LLP. Mr. Alsene is a certified public
accountant in the State of Florida. He received his Bachelor of
Science in Accounting from Florida State University and holds a
Masters in Accounting from Florida State University.
Pursuant to the Employment Agreement, Mr. Alsene will receive a
$600,000 annual base salary.
About Rotech Healthcare
Based in Orlando, Florida, Rotech Healthcare Inc. (NASDAQ: ROHI)
-- http://www.rotech.com/-- provides home medical equipment and
related products and services in the United States, with a
comprehensive offering of respiratory therapy and durable home
medical equipment and related services. The company provides
equipment and services in 48 states through approximately 500
operating centers located primarily in non-urban markets.
The Company reported a net loss of $14.76 million in 2011, a net
loss of $4.20 million in 2010, and a net loss of $21.08 million
in 2009.
The Company's balance sheet at Sept. 30, 2012, showed $255.76
million in total assets, $601.98 million in total liabilities and
a $346.22 million total stockholders' deficiency.
Bankruptcy Warning
"In the event that we lack the ability to generate adequate cash
to support our ongoing operations, we may need to access the
financial markets by seeking additional debt or equity financing.
As disclosed in our Risk Factors, there may be uncertainty
surrounding our ability to access capital in the marketplace. The
Company may be unable to secure the $15.0 million in additional
financing permitted to it under the Indentures for our Senior
Secured Notes and our Senior Second Lien Notes or to refinance its
indebtedness on commercially reasonable terms, in which case it
would need to identify alternative options to address its current
and prospective credit situation, such as a sale of the Company or
other strategic transaction, or a transformative transaction, such
as a possible restructuring or reorganization of the Company's
operations which could include filing for bankruptcy protection,"
the Company said in its quarterly report for the period ended
Sept. 30, 2012.
* * *
As reported by the TCR on Aug. 21, 2012, Standard & Poor's Ratings
Services lowered its rating on Orlando, Fla.-based Rotech
Healthcare Inc. to 'CCC-' from 'B'. "The ratings reflect Rotech's
highly leveraged financial risk profile, dominated by its weak
liquidity position, high debt burden and overall sensitivity of
credit metrics to the uncertain reimbursement environment," said
Standard & Poor's credit analyst Tahira Wright.
In the Aug. 30, 2012, edition of the TCR, Moody's Investors
Service downgraded Rotech Healthcare, Inc.'s Corporate Family
Rating to Caa3 from B3 and Probability of Default Rating to Caa3
from B2. This rating action is based on Moody's expectation that
Rotech's liquidity and credit metrics -- which are already weak --
will deteriorate further over the next few quarters. Moody's
expects continued top-line pressure from Medicare reimbursement
cuts in 2013.
SALON MEDIA: Signs Employment Pact with Chief Executive Officer
---------------------------------------------------------------
Salon Media Group, Inc., entered into an employment agreement with
Cynthia Jeffers, the Company's Chief Executive Officer.
The Employment Agreement provides for Ms. Jeffers to serve as the
Company's CEO, at an annual base salary of $225,000, less
applicable withholdings, payable in accordance with the Company's
normal payroll procedures.
The Employment Agreement also provides for Ms. Jeffers to be
eligible to receive additional compensation under a Bonus Plan, to
be approved by the Compensation Committee of the Board of
Directors for Fiscal Year 2013. Further, the agreement sets forth
the right of Ms. Jeffers to receive an option to purchase up to
1,056,478 shares of the Company's common stock.
A copy of the Employment Agreement is available for free at:
http://is.gd/Uwhoa3
About Salon Media
San Francisco, Calif.-based Salon Media Group (OTC BB: SLNM.OB)
-- http://www.Salon.com/-- is an online news and social
networking company and an Internet publishing pioneer.
The Company reported a net loss of $4.09 million for the
year ended March 31, 2012, a net loss of $2.58 million for fiscal
2011, and a net loss of $4.86 million for fiscal year 2010.
Burr Pilger Mayer, Inc., in San Francisco, California, issued a
"going concern" qualification on the consolidated financial
statements for the fiscal year ended March 31, 2012. The
independent auditors noted that the Company has suffered recurring
losses and negative cash flows from operations and has an
accumulated deficit of $112.5 million at March 31, 2012, which
raise substantial doubt about the Company's ability to continue as
a going concern.
The Company's balance sheet at Sept. 30, 2012, showed $1.41
million in total assets, $16.25 million in total liabilities and a
$14.84 million total stockholders' deficit.
SAN BERNARDINO: Pendency Plan a 'Sham', CalPERS Says
----------------------------------------------------
Matthew Heller at Bankruptcy Law360 reports that the city of San
Bernardino, Calif., should be declared ineligible for bankruptcy
relief, the California Public Employees' Retirement System said in
court papers Friday, calling the city's pendency plan a "sham"
that confirms its bankruptcy petition was not filed in good faith.
About San Bernardino
San Bernardino, California, filed an emergency petition for
municipal bankruptcy under Chapter 9 of the U.S. Bankruptcy Code
(Bankr. C.D. Calif. Case No. 12-28006) on Aug. 1, 2012. San
Bernardino, a city of about 210,000 residents roughly 65 miles
(104 km) east of Los Angeles, estimated assets and debts of more
than $1 billion in the bare-bones bankruptcy petition.
The city council voted on July 10, 2012, to file for bankruptcy.
The move lets San Bernardino bypass state-required mediation with
creditors and proceed directly to U.S. Bankruptcy Court.
The city is represented that Paul R. Glassman, Esq., at Stradling
Yocca Carlson & Rauth.
San Bernardino joined two other California cities in bankruptcy:
Stockton, an agricultural center of 292,000 east of San Francisco,
and Mammoth Lakes, a mountain resort town of 8,200 south of
Yosemite National Park.
SATCON TECHNOLOGY: Cash Collateral Access Approved Until March 2
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware, in a final
order, authorized Satcon Technology Corporation, et al., to use
the cash collateral of senior secured creditor Silicon Valley Bank
until March 2, 2013.
The Debtors would use the cash collateral to fund the daily
operation of their business. The Debtors had been unable to
obtain financing from sources on terms more favorable than
provided in the final order.
Pursuant to a stipulation dated Oct. 16, 2012, the Debtors are
liable to the senior secured creditor in the approximate amount of
$14,536,165 plus accrued interest of $88,896 and other fees.
The Debtors relate that Compass Horizon Funding Company LLC has
transferred agreements to Horizon Credit LLC and Velocity Venture
Funding, LLC.
The subordinated secured creditors assert that the Debtors owe (i)
Horizon Credit LLC -- $5,277,964 in principal plus $101,638 in
interest plus $21,601 for other fees; and (ii) Velocity Venture
Funding, LLC -- $1,055,592 in principal plus $20,327 in interest
plus $4,320 in other fees, costs and expenses.
As adequate protection from any diminution in value of the
lenders' collateral, the Debtors will grant the senior secured
creditor and subordinated secured creditors replacement liens in
all assets, superpriority administrative claim status, subject to
carve out on certain expenses.
Additionally, the Debtors will pay postpetition interest.
About SatCon Technology
Based in Boston, SatCon Technology Corporation (NasdaqCM: SATC) --
http://www.satcon.com/-- and its wholly owned subsidiaries
provide utility-grade power conversion solutions for the renewable
energy market, primarily for large-scale commercial and utility-
scale solar photovoltaic markets.
Satcon Technology Corporation, along with six related entities,
filed Chapter 11 petitions (Bankr. D. Del. Case No. 12-12869) on
Oct. 17, 2012. Satcon disclosed assets of $92.3 million and
liabilities totaling $121.9 million. Liabilities include $13.5
million in secured debt owing to Silicon Valley Bank. There is
another $6.5 million in secured subordinated debt. Unsecured
liabilities include $16 million on subordinated notes.
The Hon. Kevin Gross presides over the case. Dennis A. Meloro,
Esq., at Greenberg Traurig serves as the Debtors' counsel. Fraser
Milner Casgrain LLP acts as the general Canadian counsel. Lazard
Middle Market LLC serves as the Debtors' financial advisor and
investment banker. Epiq Bankruptcy Solutions, LLC, serves as the
Debtors' claims and noticing agent.
An official committee of unsecured creditors has not yet been
appointed in these cases by the Office of the United States
Trustee.
SATCON TECHNOLOGY: Holland & Knight Approved as Committee Counsel
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
the Official Committee of Unsecured Creditors in the Chapter 11
cases of Satcon Technology Corporation, et al., to retain Holland
& Knight LLP as its counsel. H&K is a "disinterested person" as
that term is defined in Section 101(14) of the Bankruptcy Code.
About SatCon Technology
Based in Boston, SatCon Technology Corporation (NasdaqCM: SATC) --
http://www.satcon.com/-- and its wholly owned subsidiaries
provide utility-grade power conversion solutions for the renewable
energy market, primarily for large-scale commercial and utility-
scale solar photovoltaic markets.
Satcon Technology Corporation, along with six related entities,
filed Chapter 11 petitions (Bankr. D. Del. Case No. 12-12869) on
Oct. 17, 2012. Satcon disclosed assets of $92.3 million and
liabilities totaling $121.9 million. Liabilities include $13.5
million in secured debt owing to Silicon Valley Bank. There is
another $6.5 million in secured subordinated debt. Unsecured
liabilities include $16 million on subordinated notes.
The Hon. Kevin Gross presides over the case. Dennis A. Meloro,
Esq., at Greenberg Traurig serves as the Debtors' counsel. Fraser
Milner Casgrain LLP acts as the general Canadian counsel. Lazard
Middle Market LLC serves as the Debtors' financial advisor and
investment banker. Epiq Bankruptcy Solutions, LLC, serves as the
Debtors' claims and noticing agent.
The Official Committee of Unsecured Creditors is represented by
Holland & Knight LLP as counsel and Sullivan Hazeltine Allinson
LLC as co-counsel.
SATCON TECHNOLOGY: Settlement With Great Wall Effective Dec. 7
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
the amendment of a Dec. 3, 2012, order authorizing Satcon
Technology Corporation, et al., to (i) enter into a settlement
with Great Wall, (ii) incur a postpetition trade credit; and (iii)
grant priming lien to secure postpetition trade credit.
The amendment provided that the settlement will be effective and
enforceable at 4 p.m., on Dec. 7, 2012, rather than Dec. 5. The
extension will enable the Court to issue an opinion, well as to
provide the District Court some additional time to consider a stay
application.
The Court also ordered that, among other things:
-- the settlement agreement with Great Wall is approved
materially with any non-material changes as may be agreed to by
the Debtors and Great Wall;
-- the Debtors will grant Great Wall a first priority priming
lien on all of the Debtors' assets to secure the postpetition
advances, which lien will be capped at $5 million; and
-- the automatic stay will be modified but only to the extent
necessary to permit the Debtors to grant Great Wall security
interests and liens with respect to the Debtors' assets and to
allow Great Wall to make any filings evidencing the security
interests and liens.
About SatCon Technology
Based in Boston, SatCon Technology Corporation (NasdaqCM: SATC) --
http://www.satcon.com/-- and its wholly owned subsidiaries
provide utility-grade power conversion solutions for the renewable
energy market, primarily for large-scale commercial and utility-
scale solar photovoltaic markets.
Satcon Technology Corporation, along with six related entities,
filed Chapter 11 petitions (Bankr. D. Del. Case No. 12-12869) on
Oct. 17, 2012. Satcon disclosed assets of $92.3 million and
liabilities totaling $121.9 million. Liabilities include $13.5
million in secured debt owing to Silicon Valley Bank. There is
another $6.5 million in secured subordinated debt. Unsecured
liabilities include $16 million on subordinated notes.
The Hon. Kevin Gross presides over the case. Dennis A. Meloro,
Esq., at Greenberg Traurig serves as the Debtors' counsel. Fraser
Milner Casgrain LLP acts as the general Canadian counsel. Lazard
Middle Market LLC serves as the Debtors' financial advisor and
investment banker. Epiq Bankruptcy Solutions, LLC, serves as the
Debtors' claims and noticing agent.
The Official Committee of Unsecured Creditors is represented by
Holland & Knight LLP as counsel and Sullivan Hazeltine Allinson
LLC as co-counsel.
SATCON TECHNOLOGY: Sullivan Approved as Committee Co-Counsel
------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
the Official Committee of Unsecured Creditors in the Chapter 11
cases of Satcon Technology Corporation, et al., to retain Sullivan
Hazeltine Allinson LLC as its co-counsel.
About SatCon Technology
Based in Boston, SatCon Technology Corporation (NasdaqCM: SATC) --
http://www.satcon.com/-- and its wholly owned subsidiaries
provide utility-grade power conversion solutions for the renewable
energy market, primarily for large-scale commercial and utility-
scale solar photovoltaic markets.
Satcon Technology Corporation, along with six related entities,
filed Chapter 11 petitions (Bankr. D. Del. Case No. 12-12869) on
Oct. 17, 2012. Satcon disclosed assets of $92.3 million and
liabilities totaling $121.9 million. Liabilities include $13.5
million in secured debt owing to Silicon Valley Bank. There is
another $6.5 million in secured subordinated debt. Unsecured
liabilities include $16 million on subordinated notes.
The Hon. Kevin Gross presides over the case. Dennis A. Meloro,
Esq., at Greenberg Traurig serves as the Debtors' counsel. Fraser
Milner Casgrain LLP acts as the general Canadian counsel. Lazard
Middle Market LLC serves as the Debtors' financial advisor and
investment banker. Epiq Bankruptcy Solutions, LLC, serves as the
Debtors' claims and noticing agent.
The Official Committee of Unsecured Creditors is represented by
Holland & Knight LLP as counsel and Sullivan Hazeltine Allinson
LLC as co-counsel.
SORENSON COMMUNICATIONS: S&P Keeps Prelim. 'B-' Corp Credit Rating
------------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its preliminary issue-
level ratings on Salt Lake City, Utah based Sorenson
Communications Inc.'s proposed first-out revolver due 2017,
first-lien notes due 2020, term loan due 2020, and preliminary
first-lien second-out notes due 2020. "We withdrew these
preliminary issue-level ratings following the announcement that
Sorensen will delay its proposed refinancing due to a pending FCC
decision that could affect the company," S&P said.
"The corporate credit rating remains preliminary 'B-'. The outlook
is stable. We expect the deal to relaunch in 2013 after the FCC
ruling, and we will reevaluate the proposed deal structure at that
time," S&P said.
SOUTHERN AIR: Judge Approves Ch. 11 Disclosure Statement
--------------------------------------------------------
Jamie Santo at Bankruptcy Law360 reports that a Delaware
bankruptcy judge on Tuesday approved the Chapter 11 disclosure
statement of Southern Air Holdings Inc. after the cargo carrier
smoothed out issues with objecting parties who claimed that the
document revealed too little about the company's proposed
reorganization.
About Southern Air
Based in Norwalk, Connecticut, military cargo airline Southern
Air Inc. -- http://www.southernair.com/-- its parent Southern Air
Holdings Inc. and their affiliated entities filed for Chapter 11
bankruptcy protection (Bankr. D. Del. Case Nos. 12-12690 to
12-12707) in Wilmington on Sept. 28, 2012, blaming the decline in
business from the U.S. Department of Defense, which reduced its
troop count in Afghanistan and hired Southern Air less frequently.
Bankruptcy Judge Christopher S. Sontchi presides over the case.
Brian S. Rosen, Esq., Candace Arthur, Esq., and Gabriel Morgan,
Esq., at Weil, Gotshal & Manges LLP; and M. Blake Cleary, Esq.,
and Maris J. Kandestin, Esq., at Young, Conaway, Stargatt &
Taylor, serve as the Debtor's counsel. Zolfo Cooper LLC serves as
the Debtors' bankruptcy consultant and special financial advisor.
Kurtzman Carson Consultants, LLC, serves as claims and notice
agent.
CF6-50, LLC, debtor-affiliate, disclosed $338,925,282 in assets
and $288,000,000 in liabilities as of the Chapter 11 filing. The
petition was signed by Jon E. Olin, senior vice president.
Canadian Imperial Bank of Commerce, New York Agency, the DIP agent
and prepetition agent, is represented by Matthew S. Barr, Esq.,
and Samuel Khalil, Esq., at Milbank Tweed Hadley & McCloy LLP; and
Mark D. Collins, Esq., and Katherine L. Good, Esq., at Richards
Layton & Finger PA.
Stephen J. Shimshak, Esq., and Kelley A. Cornish, Esq., at Paul
Weiss Rifkind Wharton & Garrison LLP; and Mark E. Felger, Esq., at
Cozen O'Connor, represent Oak Hill Capital Partners II, LP, OH
Aircraft Acquisition LLC, and Oak Hill Cargo 360 LLC.
The Debtors' Plan provides that lenders agreed to accept ownership
of the company as payment for their $288 million loan.
On Nov. 21, 2012, Roberta DeAngelis, U.S. Trustee for Region 3,
appointed the statutory committee of unsecured creditors.
SPRINT NEXTEL: Fitch Keeps Low-B Ratings on Several Facilities
--------------------------------------------------------------
Fitch Ratings maintains the following ratings for Sprint Nextel
Corporation and its subsidiaries on Rating Watch Positive:
Sprint Nextel
-- Issuer Default Rating (IDR) 'B+';
-- Senior unsecured credit facility 'BB/RR2';
-- Junior guaranteed unsecured notes 'BB/RR2';
-- Senior unsecured notes 'B+/RR4'.
Sprint Capital Corporation
-- IDR 'B+';
-- Senior unsecured notes 'B+/RR4'.
Nextel Communications Inc. (Nextel)
-- IDR 'B+'.
Fitch has maintained the Rating Watch Positive after Sprint Nextel
entered into a definitive agreement to acquire the approximate 50%
stake in Clearwire Corp. it currently does not own for $2.2
billion. Sprint Nextel will also provide a loan of up to $800
million in interim financing in the form of exchangeable notes,
which will be exchangeable under certain conditions for Clearwire
class B common stock. Under the financing agreement, Sprint has
agreed to purchase $80 million of exchangeable notes per month for
up to 10 months beginning in January 2013. The transaction will
require regulatory approval and a majority of non-Sprint owned
Clearwire shares. The Clearwire acquisition, which is contingent
on the Softbank transaction finalizing, is expected to close mid-
2013 at approximately the same time as Softbank.
Fitch believes Clearwire's spectrum assets are integral to Sprint
Nextel's long-term LTE plans by solving the need for high capacity
spectrum in its urban cores. This strengthens Sprint's
competitive position and ability to differentiate unlimited
wireless broadband offerings from its national peers. As such,
Fitch views this strategically as a positive event since the
acquisition would give Sprint Nextel complete control of
Clearwire's spectrum and allow Sprint to fully integrate Clearwire
assets into its network. Thus the transaction eliminates future
equity contributions, reduces inefficient operating expenses and
facilitates the execution of its strategic plans.
From a credit profile perspective, pro forma leverage would
increase to over 5x. Given the increase in leverage, the
prospects for a ratings upgrade to 'BB-' once the two acquisitions
close have potentially diminished. Sprint's execution on stated
network objectives and whether the company can demonstrate further
operational and financial improvements in the coming quarters
despite the increased competitive intensity has elevated
importance. Material uncertainty also still exists with Sprint's
post-transaction capital structure plans and uses for Softbank's
capital infusion which will be a key factor in the final rating
decision.
Uncertainty exists whether non-Sprint Clearwire shareholders will
approve the transaction. Fitch believes Clearwire's stand-alone
prospects were bleak due to its constrained liquidity, limited
access to new capital and inability to attract major new
customers. Over time, as consolidation has removed potential
wholesale partners and operators have become more efficient with
spectrum assets through acquisition and swaps, the industry has
obviated the need for a wholesale operator. Clearwire's lack of
additional strategic agreements with other operators, limited
market access and substantial funding gap left the company heavily
reliant on Sprint Nextel for further funding.
Absent Clearwire shareholder approval, a financial restructuring
of Clearwire is quite possible. This would have significant
implications and risks for Clearwire's stakeholders with an
uncertain outcome. In addition, a financial restructuring would
introduce material uncertainty with Sprint's longer-term network
and spectrum plans. Clearwire was expected to begin supplying
Sprint with hotspot capacity for its LTE network beginning in mid-
2013.
Fitch now views Sprint Nextel's liquidity as strong despite the
significant cash requirements expected through at least 2013. In
addition to the expected $8 billion from Softbank, Sprint Nextel's
liquidity position is supported by $6.3 billion of cash and $1.2
billion borrowing capacity under its $2.2 billion revolving credit
agreement at the end of the third quarter 2012. Fitch expects
Sprint Nextel will consider parameters for a new facility in early
2013 given the October 2013 maturity. Approximately $423 million
is also available through May 31, 2013 under the first tranche of
the secured equipment credit facility. The incremental Softbank
investment has afforded Sprint Nextel considerable financial
flexibility to address refinancing requirements and strategic
investments which the company has demonstrated in the past two
months.
Sprint has significantly improved its maturity profile as a result
of debt issuances in the past year and reduced refinancing risk in
the midst of a capital intensive period. In mid-2011, Sprint had
$8 billion in debt maturities during the next four years,
including $2.3 billion in 2012, $1.8 billion in 2013, and $1.4
billion in 2014. For the third quarter 2012, pro forma for the
November $2.3 billion debt issuance, Sprint has approximately $1
billion in debt maturities during the next three years including
$317 million in 2013, $198 million in 2014 and $500 million in
2015.
WHAT COULD TRIGGER A RATING ACTION
Negative: The ratings are on a Rating Watch Positive. As a result,
Fitch's sensitivities do not currently anticipate developments
with a material likelihood, individually or collectively, of
leading to a rating downgrade.
Positive: The ratings are on a Rating Watch Positive. Future
developments that may, individually or collectively lead to
positive rating action include:
-- Completion of Softbank merger and expected uses for the $8
billion cash injection.
-- Plans for post-close capital structure.
-- The degree of operational, strategic, and legal linkage
between Softbank and Sprint Nextel.
-- Trends associated with operating performance for postpaid
subscribers, churn, and ARPU.
-- Sprint Nextel's continued progress with network modernization
plans including cost improvements and LTE network deployment.
SYNAGRO TECHNOLOGIES: S&P Cuts CCR to 'CCC-' on Covenant Breach
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered all of its ratings on
Houston, Texas-based Synagro Technologies Inc. (Synagro) by one
notch, including the corporate credit rating, which S&P lowered to
'CCC-' from 'CCC'. The outlook is negative.
"The downgrade of Synagro reflects the company's highly leveraged
financial risk profile and weak liquidity," said credit analyst
James Siahaan. "The company breached its maximum leverage covenant
under its secured credit facilities during the third quarter, and
we believe it will likely be in violation with the covenant at the
end of the fourth quarter as well."
"The negative outlook reflects our expectation that Synagro's
liquidity is likely to remain weak during the next few quarters.
Despite the waiver agreement, the company has limited availability
under the revolving facility and needs to find a long-term
solution to its financial condition. We would lower the ratings in
the event of a payment default or if Synagro engages in a
financial restructuring in which it voluntarily restructures or
repurchases its debt in such a way that results in anything less
than full and timely repayment. While less likely, we could raise
the ratings if earnings and cash flow strengthen markedly and
rapidly, leverage declines, and liquidity improves significantly,"
S&P said.
TEJAL INVESTMENT: Bank Can Foreclose on Comfort Inn Hotel
---------------------------------------------------------
At the behest of First-Citizens Bank & Trust Co., Bankruptcy Judge
William T. Thurman lifted the automatic stay to allow the bank to
exercise its rights with respect to Tejal Investment, LLC's real
property owned. The judge agreed with the bank that the Debtor
has no "reasonable possibility of a successful reorganization
within a reasonable time."
The Debtor filed a Chapter 11 Plan of Reorganization and
Disclosure Statement on Nov. 13, 2012. No hearings have been set
on the approval of the Disclosure Statement or the confirmation of
the Plan.
According to Judge Thurman, a successful reorganization for the
Debtor is unreasonable and not probable because the Plan is not
feasible and reorganization is not in prospect given the Debtor's
financial circumstances.
A copy of the Court's Dec. 12, 2012 Memorandum Decision is
available at http://is.gd/Dacwdcfrom Leagle.com.
Tejal Investment filed a chapter 11 petition (Bankr. D. Utah Case
No. 12-28606) on July 3, 2012. The Debtor's primary asset is a
60-room hotel property in Logan, Utah. Since 2009, the Debtor has
operated the hotel pursuant to a franchise agreement with Choice
Hotel International under the trade name "Comfort Inn." No
committee has been appointed in the case.
The Debtor estimated under $10 million in both assets and debts.
This is the Debtor's second bankruptcy filing. It sought also
chapter 11 case (Bankr. D. Utah Case No. 10-28056) on June 14,
2010. Judge R. Kimball Mosier oversaw the 2010 case. Tyler J.
Jensen, Esq. -- tylerjensen@lebaronjensen.com -- at LeBaron &
Jensen, P.C., served as counsel.
No plan was confirmed in the 2010 case and the case was dismissed
on Dec. 20, 2011, upon the request of First-Citizens Bank & Trust
Co.
In the 2010 petition, the Debtor also estimated under $10 million
in both assets and debts.
Tyler T. Todd, Esq., at Labrum Neeley Velez & Associates, PC, in
St. George, Utah, represents the Debtor in the 2012 case.
Daniel K. Watkins, Esq. -- dwatkins@peckhadfield.com -- at Peck
Hadfield Baxter & Moore, LLC, in Logan, represents First-Citizens
Bank & Trust Co.
TRIBUNE CO: Removal Period Extended to Jan. 31
----------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware issued an
order extending the deadline for Tribune Co. to file its notices
of removal of claims or causes of action extended to January 31,
2013, or 10 business days after the effective date of the
company's plan of reorganization.
A full-text copy of the agreement can be accessed for free
at http://bankrupt.com/misc/Tribune_WarnerSettlement.pdf
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Co. --
http://www.tribune.com/-- is a media company, operating
businesses in publishing, interactive and broadcasting, including
ten daily newspapers and commuter tabloids, 23 television
stations, WGN America, WGN-AM and the Chicago Cubs baseball team.
The Company and 110 of its affiliates filed for Chapter 11
protection (Bankr. D. Del. Lead Case No. 08-13141) on Dec. 8,
2008. The Debtors proposed Sidley Austin LLP as their counsel;
Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel;
Lazard Ltd. and Alvarez & Marsal North America LLC as financial
advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As
of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets
and $12,972,541,148 in total debts. Chadbourne & Parke LLP and
Landis Rath LLP serve as co-counsel to the Official Committee of
Unsecured Creditors. AlixPartners LLP is the Committee's
financial advisor. Landis Rath Moelis & Company serves as the
Committee's investment banker. Thomas G. Macauley, Esq., at
Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the
Committee in connection with the lawsuit filed against former
officers and shareholders for the 2007 LBO of Tribune.
Protracted negotiations and mediation efforts and numerous
proposed plans of reorganization filed by Tribune Co. and
competing creditor groups have delayed Tribune's emergence from
bankruptcy. Many of the disputes among creditors center on the
2007 leveraged buyout fraudulence conveyance claims, the
resolution of which is a key issue in the bankruptcy case. The
bankruptcy court has scheduled a May 16 hearing on Tribune's plan.
Judge Kevin J. Carey issued an order dated July 13, 2012,
overruling objections to the confirmation of Tribune Co. and its
debtor affiliates' Plan of Reorganization. In November 2012,
Tribune received approval from the Federal Communications
Commission to transfer media licenses, one of the hurdles to
implementing the reorganization plan. Aurelius Capital Management
LP failed in halting implementation of the plan pending appeal.
Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy
News. The newsletter tracks the chapter 11 proceeding undertaken
by Tribune Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TRIBUNE CO: Litigation Trustee Can Use Documents for Lawsuits
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware revised
its previous order, which authorized Tribune Co. to create a
centralized document depository.
The revised order authorizes the litigation trustee to use certain
documents to prosecute the lawsuit filed by the committee of
Tribune's unsecured creditors against Citigroup Global Markets
Inc., and another lawsuit against Dennis FitzSimons.
The documents include those collected by the committee from its
investigation into a series of transactions that returned Tribune
to private ownership in 2007. They also include information
about the 2007 leveraged buyout shared during the plan
confirmation proceedings as well as information which the
committee obtained during discovery related to Mr. FitzSimons'
claims against former Tribune shareholders.
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Co. --
http://www.tribune.com/-- is a media company, operating
businesses in publishing, interactive and broadcasting, including
ten daily newspapers and commuter tabloids, 23 television
stations, WGN America, WGN-AM and the Chicago Cubs baseball team.
The Company and 110 of its affiliates filed for Chapter 11
protection (Bankr. D. Del. Lead Case No. 08-13141) on Dec. 8,
2008. The Debtors proposed Sidley Austin LLP as their counsel;
Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel;
Lazard Ltd. and Alvarez & Marsal North America LLC as financial
advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As
of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets
and $12,972,541,148 in total debts. Chadbourne & Parke LLP and
Landis Rath LLP serve as co-counsel to the Official Committee of
Unsecured Creditors. AlixPartners LLP is the Committee's
financial advisor. Landis Rath Moelis & Company serves as the
Committee's investment banker. Thomas G. Macauley, Esq., at
Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the
Committee in connection with the lawsuit filed against former
officers and shareholders for the 2007 LBO of Tribune.
Protracted negotiations and mediation efforts and numerous
proposed plans of reorganization filed by Tribune Co. and
competing creditor groups have delayed Tribune's emergence from
bankruptcy. Many of the disputes among creditors center on the
2007 leveraged buyout fraudulence conveyance claims, the
resolution of which is a key issue in the bankruptcy case. The
bankruptcy court has scheduled a May 16 hearing on Tribune's plan.
Judge Kevin J. Carey issued an order dated July 13, 2012,
overruling objections to the confirmation of Tribune Co. and its
debtor affiliates' Plan of Reorganization. In November 2012,
Tribune received approval from the Federal Communications
Commission to transfer media licenses, one of the hurdles to
implementing the reorganization plan. Aurelius Capital Management
LP failed in halting implementation of the plan pending appeal.
Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy
News. The newsletter tracks the chapter 11 proceeding undertaken
by Tribune Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TRIBUNE CO: TV Guide Wins Stay Relief to Pursue Patent Lawsuit
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District in Delaware lifted the
automatic stay that was applied to a pending patent-infringement
lawsuit against Tribune Media Services Inc.
The bankruptcy court's decision allows TV Guide Online Inc. and
TV Guide Online LLC to prosecute the lawsuit against the Tribune
Co. subsidiary in a district court in Delaware.
The companies sued Tribune Media for alleged infringement of a
patent related to technology that allows users to access
television program listings for their viewing location using a
computer. The companies assert a claim of $5.7 million for the
alleged patent infringement.
Earlier, Tribune opposed a provision contained in TV Guide's
proposed order regarding the allowance of its claim. That
provision was removed in the revised order signed off by the
bankruptcy court on December 10. A copy of the revised proposed
order can be accessed for free at http://is.gd/156tdz
Pursuant to the December 10 order, in case TV Guide obtains any
final monetary judgment, the company is not allowed to seek to
satisfy the final monetary judgment from any property of Tribune
Media estate except as provided for in Tribune's Chapter 11 plan.
A full-text copy of the December 10 order can be accessed for
free at http://bankrupt.com/misc/Tribune_OrdTVGuide.pdf
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Co. --
http://www.tribune.com/-- is a media company, operating
businesses in publishing, interactive and broadcasting, including
ten daily newspapers and commuter tabloids, 23 television
stations, WGN America, WGN-AM and the Chicago Cubs baseball team.
The Company and 110 of its affiliates filed for Chapter 11
protection (Bankr. D. Del. Lead Case No. 08-13141) on Dec. 8,
2008. The Debtors proposed Sidley Austin LLP as their counsel;
Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel;
Lazard Ltd. and Alvarez & Marsal North America LLC as financial
advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As
of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets
and $12,972,541,148 in total debts. Chadbourne & Parke LLP and
Landis Rath LLP serve as co-counsel to the Official Committee of
Unsecured Creditors. AlixPartners LLP is the Committee's
financial advisor. Landis Rath Moelis & Company serves as the
Committee's investment banker. Thomas G. Macauley, Esq., at
Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the
Committee in connection with the lawsuit filed against former
officers and shareholders for the 2007 LBO of Tribune.
Protracted negotiations and mediation efforts and numerous
proposed plans of reorganization filed by Tribune Co. and
competing creditor groups have delayed Tribune's emergence from
bankruptcy. Many of the disputes among creditors center on the
2007 leveraged buyout fraudulence conveyance claims, the
resolution of which is a key issue in the bankruptcy case. The
bankruptcy court has scheduled a May 16 hearing on Tribune's plan.
Judge Kevin J. Carey issued an order dated July 13, 2012,
overruling objections to the confirmation of Tribune Co. and its
debtor affiliates' Plan of Reorganization. In November 2012,
Tribune received approval from the Federal Communications
Commission to transfer media licenses, one of the hurdles to
implementing the reorganization plan. Aurelius Capital Management
LP failed in halting implementation of the plan pending appeal.
Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy
News. The newsletter tracks the chapter 11 proceeding undertaken
by Tribune Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TRIBUNE CO: KTLA Inc. Seeks to Expunge Waller's $5-Mil. Claim
-------------------------------------------------------------
KTLA Inc. asked the U.S. Bankruptcy Court for the District of
Delaware to disallow and expunge Claim No. 4412 filed by claimant
Marta Waller.
Ms. Waller filed a $5 million claim against KTLA, a debtor
affiliate of Tribune Co., after she was allegedly terminated from
her job in 2008.
The claimant provided KTLA with various reporting services
pursuant to a 2007 contract between the company and Persistence
Pays Inc.
In a court filing, KTLA said the contract giving rise to the
claim expired of its own accord prior to KTLA's bankruptcy filing
and had been "fully performed" such that no further right to
payment existed as of the company's bankruptcy filing.
"The entity that would have a right to payment under the
applicable contract did not file a proof of claim by the bar date
for filing claims," KTLA further argued.
A court hearing is scheduled for January 16, 2013. Objections
are due by January 4, 2013.
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Co. --
http://www.tribune.com/-- is a media company, operating
businesses in publishing, interactive and broadcasting, including
ten daily newspapers and commuter tabloids, 23 television
stations, WGN America, WGN-AM and the Chicago Cubs baseball team.
The Company and 110 of its affiliates filed for Chapter 11
protection (Bankr. D. Del. Lead Case No. 08-13141) on Dec. 8,
2008. The Debtors proposed Sidley Austin LLP as their counsel;
Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel;
Lazard Ltd. and Alvarez & Marsal North America LLC as financial
advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As
of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets
and $12,972,541,148 in total debts. Chadbourne & Parke LLP and
Landis Rath LLP serve as co-counsel to the Official Committee of
Unsecured Creditors. AlixPartners LLP is the Committee's
financial advisor. Landis Rath Moelis & Company serves as the
Committee's investment banker. Thomas G. Macauley, Esq., at
Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the
Committee in connection with the lawsuit filed against former
officers and shareholders for the 2007 LBO of Tribune.
Protracted negotiations and mediation efforts and numerous
proposed plans of reorganization filed by Tribune Co. and
competing creditor groups have delayed Tribune's emergence from
bankruptcy. Many of the disputes among creditors center on the
2007 leveraged buyout fraudulence conveyance claims, the
resolution of which is a key issue in the bankruptcy case. The
bankruptcy court has scheduled a May 16 hearing on Tribune's plan.
Judge Kevin J. Carey issued an order dated July 13, 2012,
overruling objections to the confirmation of Tribune Co. and its
debtor affiliates' Plan of Reorganization. In November 2012,
Tribune received approval from the Federal Communications
Commission to transfer media licenses, one of the hurdles to
implementing the reorganization plan. Aurelius Capital Management
LP failed in halting implementation of the plan pending appeal.
Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy
News. The newsletter tracks the chapter 11 proceeding undertaken
by Tribune Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TRIBUNE CO: Citigroup Facing Claims Over 2007 Leveraged Buyout
--------------------------------------------------------------
Citigroup Inc. continues to be involved in the Tribune Company
bankruptcy, according to the Company's Form 10-Q filing with the
U.S. Securities and Exchange Commission for the quarterly period
ended September 30, 2012.
Certain Citigroup affiliates have been named as defendants in
adversary proceedings related to the Chapter 11 cases of Tribune
Company (Tribune) pending in the United States Bankruptcy Court
for the District of Delaware. The complaints, which arise out of
the approximate $11 billion leveraged buyout of Tribune in 2007,
were stayed by court order pending a confirmation hearing on
competing plans of reorganization. On October 31, 2011, the
bankruptcy court denied confirmation of both the competing plans.
A third amended plan of reorganization was then proposed, and
confirmation proceedings are expected to take place in 2012.
On July 23, 2012, the United States Bankruptcy Court for the
District of Delaware confirmed the fourth amended plan of
reorganization. Certain parties are appealing that decision.
Additional information relating to this action is publicly
available in court filings under the docket numbers 08-13141
(Bankr. D. Del.) (Carey, J.) and 12 Civ. 01072, 01073, 00128,
01106 and 01100 (D. Del.) (Sleet, C.J.).
Certain Citigroup affiliates also have been named as defendants
in actions brought by Tribune creditors alleging state law
constructive fraudulent conveyance claims relating to the Tribune
LBO. These actions have been stayed pending confirmation of a
plan of reorganization. Additional information relating to these
actions is publicly available in court filings under the docket
number 11 MD 02296 (S.D.N.Y.) (Holwell, J.).
Citigroup Inc. is a global diversified financial services holding
company whose businesses provide consumers, corporations,
governments and institutions with a broad range of financial
products and services.
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Co. --
http://www.tribune.com/-- is a media company, operating
businesses in publishing, interactive and broadcasting, including
ten daily newspapers and commuter tabloids, 23 television
stations, WGN America, WGN-AM and the Chicago Cubs baseball team.
The Company and 110 of its affiliates filed for Chapter 11
protection (Bankr. D. Del. Lead Case No. 08-13141) on Dec. 8,
2008. The Debtors proposed Sidley Austin LLP as their counsel;
Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel;
Lazard Ltd. and Alvarez & Marsal North America LLC as financial
advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As
of Dec. 8, 2008, the Debtors have $7,604,195,000 in total assets
and $12,972,541,148 in total debts. Chadbourne & Parke LLP and
Landis Rath LLP serve as co-counsel to the Official Committee of
Unsecured Creditors. AlixPartners LLP is the Committee's
financial advisor. Landis Rath Moelis & Company serves as the
Committee's investment banker. Thomas G. Macauley, Esq., at
Zuckerman Spaeder LLP, in Wilmington, Delaware, represents the
Committee in connection with the lawsuit filed against former
officers and shareholders for the 2007 LBO of Tribune.
Protracted negotiations and mediation efforts and numerous
proposed plans of reorganization filed by Tribune Co. and
competing creditor groups have delayed Tribune's emergence from
bankruptcy. Many of the disputes among creditors center on the
2007 leveraged buyout fraudulence conveyance claims, the
resolution of which is a key issue in the bankruptcy case. The
bankruptcy court has scheduled a May 16 hearing on Tribune's plan.
Judge Kevin J. Carey issued an order dated July 13, 2012,
overruling objections to the confirmation of Tribune Co. and its
debtor affiliates' Plan of Reorganization. In November 2012,
Tribune received approval from the Federal Communications
Commission to transfer media licenses, one of the hurdles to
implementing the reorganization plan. Aurelius Capital Management
LP failed in halting implementation of the plan pending appeal.
Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy
News. The newsletter tracks the chapter 11 proceeding undertaken
by Tribune Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TRIAD GUARANTY: Three Directors Resign from Board
-------------------------------------------------
Lee Durham, Jr., Deane W. Hall, and Kenneth W. Jones notified
Triad Guaranty Inc. of their resignation from the Board of
Directors of the Company, effective Dec. 14, 2012. Mr. Jones will
continue to serve as the Company's President and Chief Executive
Officer.
On Dec. 11, 2012, the Company's Board approved an amendment to the
Bylaws of the Company, as amended, effective immediately. The
Amendment revised Article III, Section 1 of the Bylaws to provide
that the number of directors serving on the Company's Board may be
as few as one.
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.
Going Concern/Bankruptcy Warning
"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, Triad's current non-
compliance with a provision of the second Corrective Order, the
possible failure of Triad to comply with other 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
$802.8 million deficit in assets at September 30, 2012."
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 $224.1 million at
Sept. 30, 2012, as opposed to a deficiency in policyholders'
surplus of $834.5 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 Triad's
current non-compliance with a provision of the second Corrective
Order or for any other violation of the Illinois Insurance Code.
Moreover, if the Department determines that Triad is insolvent
under applicable law, it would be required to institute a
receivership proceeding over Triad. In addition, the Department
retains the inherent authority to institute such proceedings
against Triad for any reason and Triad has previously agreed not
to contest the taking of any such actions.
As of Nov. 14, 2012, the Department has not issued any final
decision or order as a result of the public hearing and Triad's
request to amend the second Corrective Order. Because the subject
matter of the hearing specifically included an assessment of
whether the Department should implement a different regulatory
approach with respect to Triad, including institution of
receivership proceedings for the conservation, rehabilitation or
liquidation of Triad, the Company believes institution of such a
proceeding could be imminent. If this should occur, among other
things, TGI could lose control of Triad and could be forced to
deconsolidate its financial statements. Any such actions would
likely lead TGI to institute a proceeding seeking relief from
creditors under U.S. bankruptcy laws, or take other steps to wind
up its business and liquidate. See Item 1A, "Risk Factors" in the
Company's Annual Report on Form 10-K for the year ended December
31, 2011 for more information.
As reported by the TCR on Dec. 12, 2012, the Illinois Department
of Insurance has issued an Administrative Order recommending that
Triad Guaranty Insurance Corporation be placed in rehabilitation.
Upon entry of the Order of Rehabilitation by the Court, the
Director of the Illinois Department of Insurance will be vested
with possession and control over all of the assets and liabilities
of Triad and Triad Guaranty Inc. will cease to have any oversight
or management authority over Triad or its business and affairs.
TRIDENT MICROSYSTEMS: Amended Chapter 11 Plan Confirmed
-------------------------------------------------------
BankruptcyData.com reports that the U.S. Bankruptcy Court
confirmed Trident Microsystems' Second Amended Joint Chapter 11
Plan of Liquidation.
According to documents filed with the Court, "Since the
commencement of these Chapter 11 Cases, the Debtors and the Cayman
Liquidators (and previously, the JPLs) have engaged in efforts to
solicit a plan of liquidation that would be agreeable to all of
the Debtors' Creditors and holders of Equity Interests and bring
about consensus on certain contentious issues relating to the
formulation and consummation of the Plan. Owing to these extensive
efforts, the Debtors, the Cayman Liquidators, the Creditors
Committee and the Equity Committee have entered into the Plan
Support Agreement, the terms of which resolve for all material
litigation issues, eliminate the uncertainty, time delay and
substantial costs that may be posed by litigating these complex,
cross-border issues and, most critically, provide the Class 2.A.
Creditors. . . with a substantially enhanced recovery than they
would be entitled to under the Bankruptcy Code's priority of
payment regime, while similarly providing the holders of TMI's
Equity Interests in Class 6 with a substantial return on account
of their Equity Interests. Thus, the Plan and this accompanying
Disclosure Statement encompasses the terms of the Plan Support
Agreement, which the Debtors believe will provide the most
efficient, cost-effective and equitable liquidation of the Debtors
and their Estates."
About Trident Microsystems
Sunnyvale, California-based Trident Microsystems, Inc., currently
designs, develops, and markets integrated circuits and related
software for processing, displaying, and transmitting high quality
audio, graphics, and images in home consumer electronics
applications such as digital TVs, PC-TV, and analog TVs, and set-
top boxes. The Company has research and development facilities in
Beijing and Shanghai, China; Freiburg, Germany; Eindhoven and
Nijmegen, The Netherlands; Belfast, United Kingdom; Bangalore and
Hyderabad, India; Austin, Texas; and Sunnyvale, California. The
Company has sales offices in Seoul, South Korea; Tokyo, Japan;
Hong Kong and Shenzhen, China; Taipei, Taiwan; San Diego,
California; Mumbai, India; and Suresnes, France. The Company also
has operations facilities in Taipei and Kaoshiung, Taiwan; and
Hong Kong, China.
Trident Microsystems and its Cayman subsidiary, Trident
Microsystems (Far East) Ltd. filed for Chapter 11 bankruptcy
protection (Bankr. D. Del. Lead Case No. 12-10069) on Jan. 4,
2011. Trident said it expects to shortly file for protection in
the Cayman Islands.
Judge Christopher S. Sontchi presides over the case. Lawyers at
DLA Piper LLP (US) serve as the Debtors' counsel. FTI Consulting,
Inc., is the financial advisor. Union Square Advisors LLC serves
as the Debtors' investment banker. PricewaterhouseCoopers LLP
serves as the Debtors' tax advisor and independent auditor.
Kurtzman Carson Consultants is the claims and notice agent.
Trident had $310 million in assets and $39.6 million in
liabilities as of Oct. 31, 2011. The petition was signed by David
L. Teichmann, executive VP, general counsel & corporate secretary.
Pachulski Stang Ziehl & Jones LLP represents the Official
Committee of Unsecured Creditors. The Committee tapped to retain
Fenwick & West LLP as its special tax and claims counsel, Imperial
Capital, LLC, as its investment banker and financial advisor.
Dewey & LeBoeuf initially represented the statutory committee of
equity security holders. After Dewey's own bankruptcy filing,
Proskauer Rose LLP took over as lead counsel. The equity
committee also has tapped Campbells as Cayman Islands counsel, and
Quinn Emanuel Urquhart & Sullivan, LLP as conflicts counsel.
As of Sept. 30, 2012, the Debtor had total assets of
$274.34 million, total liabilities of $37.34 million and total
stockholders' equity of $237 million.
UNI-PIXEL INC: Kevin Douglas Discloses 7.2% Equity Stake
--------------------------------------------------------
In a Schedule 13G filing with the U.S. Securities and Exchange
Commission, Kevin Douglas and his affiliates disclosed that, as of
Aug. 15, 2012, they beneficially own 698,000 shares of common
stock of Uni-Pixel, Inc., representing 7.2% of the shares
outstanding. A copy of the filing is available for free at:
http://is.gd/fLAyY3
About Uni-Pixel Inc.
The Woodlands, Tex.-based Uni-Pixel, Inc. (OTC BB: UNXL)
-- http://www.unipixel.com/-- is a production stage company
delivering its Clearly Superior(TM) Performance Engineered Films
to the Lighting & Display, Solar and Flexible Electronics market
segments.
The Company reported a net loss of $8.57 million in 2011 compared
to a net loss of $3.82 million in 2010.
The Company's balance sheet at Sept. 30, 2012, showed $16.39
million in total assets, $103,588 in total liabilities and $16.29
million in total shareholders' equity.
UNIGENE LABORATORIES: CEO Cancels 660,000 Stock Options
-------------------------------------------------------
Ashleigh Palmer, chief executive officer of Unigene Laboratories,
Inc., has elected to voluntarily cancel his entire award of
660,000 stock options, so that the Company may issue new awards
equivalent to the quantities rescinded at a future date to current
employees of the Company, that were not previously included in the
key employee retention grants.
The Board of Directors of the Company previously approved and
authorized the Company to grant certain retention stock option
grants outside of the Company's existing equity compensation plan
to all of the Company's existing employees and directors (except
Richard Levy), subject to the approval and closing of the
Forbearance Agreement and First Amendment to Amended and Restated
Financing Agreement, dated Sept. 21, 2012, by and amongst the
Company, Victory Park Management LLC, and various related lenders.
The Employee and Director Retention Grants, which were granted on
Sept. 27, 2012, were made to promote the retention of those
employees and directors and to motivate those employees and
directors and align their interests with the interests of the
Company's stockholders.
About Unigene
Unigene Laboratories, Inc. OTCBB: UGNE) -- http://www.unigene.com/
-- is a biopharmaceutical company focusing on the oral and nasal
delivery of large-market peptide drugs.
Unigene reported a net loss of $17.92 million in 2011, a net loss
of $27.86 million in 2010, and a net loss of $13.38 million in
2009.
The Company's balance sheet at June 30, 2012, showed
$11.69 million in total assets, $77.56 million in total
liabilities and a $65.87 million total stockholders' deficit.
Grant Thornton LLP, in New York, expressed substantial doubt about
the Company's ability to continue as a going concern following the
2011 financial results. The independent auditors noted that the
Company has incurred a net loss of $17,900,000 during the year
ended Dec. 31, 2011, and, as of that date, has an accumulated
deficit of $189,000,000 and the Company's total liabilities
exceeded total assets by $55,138,000.
Bankruptcy Warning
Under the Company's amended and restated March 2010 financing
agreement with Victory Park Management, LLC, so long as the
Company's outstanding note balance is at least $5,000,000, the
Company must maintain a minimum cash balance equal to at least
$2,500,000 and its cash flow must be at least $2,000,000 in any
fiscal quarter or $7,000,000 in any three consecutive quarters.
"Without additional financing, we will not be able to maintain a
minimum cash balance of $2,500,000, or maintain an adequate cash
flow, in order to avoid default in periods subsequent to
September 30, 2012," the Company said in its quarterly report for
the period ended June 30, 2012. "As a result, we will be in
default under the financing agreement, which would result in the
full amount of our debt owed to Victory Park becoming immediately
due and payable. Even if we are able to raise cash and maintain a
minimum cash balance of at least $2,500,000 through the March 2013
maturity date, there is no assurance that the notes will be
converted into common stock, in which case, we may not have
sufficient cash from operations or from new financings to repay
the Victory Park debt when it comes due. There can be no
assurance that new financings will be available on acceptable
terms, if at all. In the event that we default, Victory Park
could retain control of the Company and will have the ability to
force us into involuntary bankruptcy and liquidate our assets."
UNIGENE LABORATORIES: Taps Canaccord to Explore Strategic Options
-----------------------------------------------------------------
Unigene Laboratories, Inc., has retained Canaccord Genuity to
assist the Company with its exploration and evaluation of a broad
range of strategic options, including, but not limited to, the
strategic partnering of its technology, the out-licensing of
intellectual property and divestiture of certain assets, and the
possible sale of the Company or one of its business units.
There can be no assurance that any specific transaction regarding
the Company or its assets will be pursued or completed. There is
no definitive timetable for the process. Unigene does not intend
to disclose developments with respect to the progress of its
exploration or review and evaluation process until such time as
the Board of Directors approves or completes a transaction or
otherwise deems further disclosure appropriate.
Ashleigh Palmer, Unigene's chief executive officer, commented, "We
are excited to be working with Canaccord Genuity on exploring and
evaluating a wide range of strategic options, including those
relating to the underlying strength of our pipeline of novel
therapeutic peptides and our portfolio of Peptelligence oral
peptide drug delivery partnerships. We believe we have the right
management team, staff and advisors in place to capitalize on
Unigene's opportunities and the market impacting potential our
Peptelligence platform offers in formulating and developing oral
peptide therapeutics targeting considerable unmet medical need."
About Unigene
Unigene Laboratories, Inc. OTCBB: UGNE) -- http://www.unigene.com/
-- is a biopharmaceutical company focusing on the oral and nasal
delivery of large-market peptide drugs.
Unigene reported a net loss of $17.92 million in 2011, a net loss
of $27.86 million in 2010, and a net loss of $13.38 million in
2009.
The Company's balance sheet at June 30, 2012, showed
$11.69 million in total assets, $77.56 million in total
liabilities and a $65.87 million total stockholders' deficit.
Grant Thornton LLP, in New York, expressed substantial doubt about
the Company's ability to continue as a going concern following the
2011 financial results. The independent auditors noted that the
Company has incurred a net loss of $17,900,000 during the year
ended Dec. 31, 2011, and, as of that date, has an accumulated
deficit of $189,000,000 and the Company's total liabilities
exceeded total assets by $55,138,000.
Bankruptcy Warning
Under the Company's amended and restated March 2010 financing
agreement with Victory Park Management, LLC, so long as the
Company's outstanding note balance is at least $5,000,000, the
Company must maintain a minimum cash balance equal to at least
$2,500,000 and its cash flow must be at least $2,000,000 in any
fiscal quarter or $7,000,000 in any three consecutive quarters.
"Without additional financing, we will not be able to maintain a
minimum cash balance of $2,500,000, or maintain an adequate cash
flow, in order to avoid default in periods subsequent to
September 30, 2012," the Company said in its quarterly report for
the period ended June 30, 2012. "As a result, we will be in
default under the financing agreement, which would result in the
full amount of our debt owed to Victory Park becoming immediately
due and payable. Even if we are able to raise cash and maintain a
minimum cash balance of at least $2,500,000 through the March 2013
maturity date, there is no assurance that the notes will be
converted into common stock, in which case, we may not have
sufficient cash from operations or from new financings to repay
the Victory Park debt when it comes due. There can be no
assurance that new financings will be available on acceptable
terms, if at all. In the event that we default, Victory Park
could retain control of the Company and will have the ability to
force us into involuntary bankruptcy and liquidate our assets."
UNIGENE LABORATORIES: Reexamination of Fortical Patent Terminated
-----------------------------------------------------------------
The United States Patent and Trademark Office, on Sept. 8, 2011,
granted a request for inter partes reexamination of the Fortical
Patent filed by Apotex on July 15, 2011. Unigene filed its
response to the Reexamination Office Action on Nov. 8, 2011.
Because the Supreme Court denied Apotex's petition for certiorari,
on April 5, 2012, Unigene moved to Suspend Reexamination of Claim
19 by filing a Petition with the USPTO.
On Dec. 7, 2012, Unigene's petition to terminate the inter partes
reexamination with respect to claim 19 was granted and therefore
the inter partes reexamination with regard to claim 19 will not be
further maintained by the USPTO. Claim 19 covers the Fortical
Patent. The inter parties reexamination remains open for claims
13, 14, 16, 17 and 24-29 of the Fortical Patent.
Apotex may now file a request for an ex parte reexamination of
claim 19. If Apotex files such a request, it would remain
enjoined by the District Court's injunction unless and until they
were relieved of the injunction by the District Court after the
USPTO finally rejects claim 19 in the ex parte reexamination and
the Federal Circuit affirms.
About Unigene
Unigene Laboratories, Inc. OTCBB: UGNE) -- http://www.unigene.com/
-- is a biopharmaceutical company focusing on the oral and nasal
delivery of large-market peptide drugs.
Unigene reported a net loss of $17.92 million in 2011, a net loss
of $27.86 million in 2010, and a net loss of $13.38 million in
2009.
The Company's balance sheet at June 30, 2012, showed
$11.69 million in total assets, $77.56 million in total
liabilities and a $65.87 million total stockholders' deficit.
Grant Thornton LLP, in New York, expressed substantial doubt about
the Company's ability to continue as a going concern following the
2011 financial results. The independent auditors noted that the
Company has incurred a net loss of $17,900,000 during the year
ended Dec. 31, 2011, and, as of that date, has an accumulated
deficit of $189,000,000 and the Company's total liabilities
exceeded total assets by $55,138,000.
Bankruptcy Warning
Under the Company's amended and restated March 2010 financing
agreement with Victory Park Management, LLC, so long as the
Company's outstanding note balance is at least $5,000,000, the
Company must maintain a minimum cash balance equal to at least
$2,500,000 and its cash flow must be at least $2,000,000 in any
fiscal quarter or $7,000,000 in any three consecutive quarters.
"Without additional financing, we will not be able to maintain a
minimum cash balance of $2,500,000, or maintain an adequate cash
flow, in order to avoid default in periods subsequent to
September 30, 2012," the Company said in its quarterly report for
the period ended June 30, 2012. "As a result, we will be in
default under the financing agreement, which would result in the
full amount of our debt owed to Victory Park becoming immediately
due and payable. Even if we are able to raise cash and maintain a
minimum cash balance of at least $2,500,000 through the March 2013
maturity date, there is no assurance that the notes will be
converted into common stock, in which case, we may not have
sufficient cash from operations or from new financings to repay
the Victory Park debt when it comes due. There can be no
assurance that new financings will be available on acceptable
terms, if at all. In the event that we default, Victory Park
could retain control of the Company and will have the ability to
force us into involuntary bankruptcy and liquidate our assets."
USEC INC: Security Investors' Ownership Down to 2.32%
-----------------------------------------------------
In an amended Schedule 13G filing with the U.S. Securities and
Exchange Commission, Security Investors, LLC, disclosed that, as
of Nov. 30, 2012, it beneficially owns 3,080,114 shares of common
stock of USEC, Inc., representing 2.32% of the shares outstanding.
Security Investors previously reported beneficial ownership of
8,904,284 common shares or a 7.34% equity stake as of Dec. 11,
2011. A copy of the amended filing is available for free at:
http://is.gd/rcxkvX
About USEC Inc.
Headquartered in Bethesda, Maryland, USEC Inc. (NYSE: USU) --
http://www.usec.com/-- supplies enriched uranium fuel for
commercial nuclear power plants.
The Company reported a net loss of $540.70 million in 2011,
compared with net income of $7.50 million in 2010.
The Company's balance sheet at Sept. 30, 2012, showed
$3.76 billion in total assets, $3.11 billion in total liabilities,
and $652.2 million in stockholders' equity.
Bankruptcy Warning
"A delisting of our common stock by the NYSE and the failure of
our common stock to be listed on another national exchange could
have significant adverse consequences. A delisting would likely
have a negative effect on the price of our common stock and would
impair shareholders' ability to sell or purchase our common stock.
As of September 30, 2012, we had $530 million of convertible notes
outstanding. A "fundamental change" is triggered under the terms
of our convertible notes if our shares of common stock are not
listed for trading on any of the NYSE, the American Stock
Exchange, the NASDAQ Global Market or the NASDAQ Global Select
Market. Our receipt of a NYSE continued listing standards
notification ... did not trigger a fundamental change. If a
fundamental change occurs under the convertible notes, the holders
of the notes can require us to repurchase the notes in full for
cash. We do not have adequate cash to repurchase the notes. In
addition, the occurrence of a fundamental change under the
convertible notes that permits the holders of the convertible
notes to require a repurchase for cash is an event of default
under our credit facility. Accordingly, our inability to maintain
the continued listing of our common stock on the NYSE or another
national exchange would have a material adverse effect on our
liquidity and financial condition and would likely require us to
file for bankruptcy protection," according to the Company's
quarterly report for the period ended Sept. 30, 2012.
* * *
USEC Inc. carries 'Caa1' corporate and probability of default
ratings, with "developing" outlook, from Moody's, and 'CCC+' long
term foreign issuer credit rating and 'CCC-' long term local
issuer credit rating, with outlook "developing", from Standard &
Poor's.
In May 2010, S&P said that its rating and outlook on USEC Inc. are
not affected by the announcement that Toshiba Corp. and Babcock &
Wilcox Investment Co., an affiliate of The Babcock & Wilcox Co.,
have signed a definitive investment agreement for $200 million
with USEC.
VERENIUM CORP: Obtains $22.5-Mil. Secured Financing from Athyrium
-----------------------------------------------------------------
Verenium Corporation signed a $22.5 million secured debt financing
with the Athyrium Opportunities Fund.
Net proceeds after estimated expenses will be approximately $21.3
million, providing Verenium with capital to continue to advance
its Product Pipeline to commercialization, enhance its
manufacturing capabilities, and fund general working capital
purposes. The debt bears interest at 11.5% per annum, with
interest payments due quarterly over a five-year term and the
principal balance due as a lump-sum payment at maturity in
December 2017.
In connection with the financing, Verenium issued warrants to
Athyrium to purchase approximately 2.9 million shares of common
stock at an exercise price of $2.49 per share, representing a
17.5% premium over the closing price on the date of the debt
agreement. The warrants have a seven-year term and are
immediately exercisable.
"We are pleased to be teaming with a long term strategic investor
such as Athyrium in this transaction," said Jeffrey Black, senior
vice president and chief financial officer at Verenium. "We
anticipate that this financing will allow us to invest in our
business and fund our growth initiatives through to operating
profitability with minimal dilution to existing shareholders.
Importantly, with our financing needs now addressed, our
management team can focus on unlocking the value in our business
through new innovative products and partnerships."
"Athyrium is excited to work with Verenium and its management
team," said Richard Pines, a partner of Athyrium. "We believe
this transaction enables Verenium to continue to deploy its proven
technology by creating highly differentiated enzyme products
across a wide range of sectors and industrial applications."
More information about the transaction is available for free at:
http://is.gd/xkORCz
About Verenium Corp
San Diego, Calif.-based Verenium Corporation is an industrial
biotechnology company that develops and commercializes high
performance enzymes for a broad array of industrial processes to
enable higher productivity, lower costs, and improved
environmental outcomes. The Company operates in one business
segment with four main product lines: animal health and nutrition,
grain processing, oilfield services and other industrial
processes.
The Company's balance sheet at Sept. 30, 2012, showed $48 million
in total assets, $14.44 million in total liabilities and $33.55
million in total stockholders' equity.
Bankruptcy Warning
"Based on our current cash resources and 2012 operating plan, our
existing cash resources may not be sufficient to meet the cash
requirements to fund our planned operating expenses, capital
expenditures and working capital requirements beyond 2012 without
additional sources of cash. If we are unable to raise additional
capital, we will need to defer, reduce or eliminate significant
planned expenditures, restructure or significantly curtail our
operations, sell some or all our assets, file for bankruptcy or
cease operations," the Company said in its quarterly report for
the period ended Sept. 30, 2012.
Going Concern
Ernst & Young LLP, in San Diego, California, expressed substantial
doubt about Verenium's ability to continue as a going concern,
following the Company's results for the fiscal year ended Dec. 31,
2011. The independent auditors noted that the Company has
incurred recurring operating losses, has a working capital deficit
of $637,000 and has an accumulated deficit of $600.8 million at
Dec. 31, 2011.
VERIFONE SYSTEMS: S&P Revises Outlook on 'BB-' CCR to Positive
--------------------------------------------------------------
Standard & Poor's Ratings Services revised its rating outlook on
San Jose, Calif.-based VeriFone Systems Inc. to positive from
stable. "At the same time, we affirmed our ratings on the company,
including the 'BB-' corporate credit rating," S&P said.
"The outlook revision reflects the company's strong revenue
growth, moderating leverage, and stable earnings prospects over
the coming year, supported by its leading presence in global
merchant payment systems markets and progress integrating recent
acquisitions," said Standard & Poor's credit analyst John Moore.
"Our ratings on VeriFone Systems Inc. reflects the company's
leading global market share in growing merchant payment systems
markets, partially offset by the threat of nascent rival payment
technologies, resulting in our characterization of its business
risk profile as 'fair'. In our assessment, the company's leverage
of about 3x results in a 'significant' financial risk profile. We
expect the company will maintain its 'adequate' liquidity over the
coming year and we have assessed its management and governance as
'fair,'" S&P said.
"The positive outlook reflects the company's favorable operating
trends and prospects, supported by its increasing presence in
global merchant payment systems markets. If the company is able to
maintain organic revenue growth and earnings stability, and a
commitment to contain leverage to 3x or less, we could raise our
ratings on the company. Conversely, we could revise the outlook to
stable were the company's operating performance to unexpectedly
weaken from current levels or if more aggressive pursuit of
acquisitions or share repurchases resulted in sustained leverage
in excess of 3x," S&P said.
VITESSE SEMICONDUCTOR: W. Martin Discloses 18.1% Equity Stake
-------------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, William C. Martin and his affiliates
disclosed that, as of Dec. 7, 2012, they beneficially own
6,491,127 shares of common stock of Vitesse Semiconductor
Corporation representing 18.1% of the shares outstanding. Mr.
Martin previously reported beneficial ownership of 3,491,127
common shares or a 13.5% equity stake as of Nov. 20, 2012. A copy
of the amended filing is available at http://is.gd/RD2vYz
About Vitesse
Based in Camarillo, California, Vitesse Semiconductor Corporation
(Pink Sheets: VTSS.PK) -- http://www.vitesse.com/-- designs,
develops and markets a diverse portfolio of semiconductor
solutions for Carrier and Enterprise networks worldwide.
In October 2009, Vitesse completed a debt restructuring
transaction that resulted in the conversion of 96.7% of the
Company's 2024 Debentures into a combination of cash, common
stock, Series B Preferred Stock and 2014 Debentures. With respect
to the remaining 3.3% of the 2024 Debentures, Vitesse settled its
obligations in cash. Additionally, Vitesse repaid $5.0 million of
its $30.0 million Senior Term Loan, the terms of which were
amended as part of the debt restructuring transactions.
Vitesse incurred a net loss of $1.11 million in 2012, a net loss
of $14.81 million in 2011, and a net loss of $20.05 million in
2010.
The Company's balance sheet at Sept. 30, 2012, showed
$56.61 million in total assets, $80.63 million in total
liabilities, and a $24.01 million total stockholders' deficit.
VITESSE SEMICONDUCTOR: 2013 Annual Meeting Postponed to March 7
---------------------------------------------------------------
Vitesse Semiconductor Corporation has rescheduled the date of its
2013 annual meeting to March 7, 2013. The meeting was originally
scheduled for Jan. 29, 2013.
The Company said additional time is needed in order to complete
its discussions with Raging Capital Fund, LP, and certain of its
affiliates concerning Raging Capital's nomination of two
individuals for election to the Board of Directors of the Company.
Sells $16.7MM of Securities
On Dec. 7, 2012, the Company entered into an underwriting
agreement with the several Underwriters for which Needham &
Company, LLC, is acting as representative, relating to an
underwritten public offering of 10,000,000 shares of the Company's
common stock, $0.01 par value, at a per share price to the public
of $1.75.
Pursuant to the Underwriting Agreement, the Company granted the
Underwriters a 30-day option to purchase up to an additional
1,409,294 shares of common stock. The underwriters exercised
their option with respect to 400,000 additional shares on Dec. 11,
2012.
The public offering closed on Dec. 12, 2012, and the Company sold
to the Underwriters an aggregate of 10,400,000 shares for net
proceeds of approximately $16.7 million after deducting the
underwriting discount and estimated offering expenses payable by
the Company of approximately $312,500.
About Vitesse
Based in Camarillo, California, Vitesse Semiconductor Corporation
(Pink Sheets: VTSS.PK) -- http://www.vitesse.com/-- designs,
develops and markets a diverse portfolio of semiconductor
solutions for Carrier and Enterprise networks worldwide.
In October 2009, Vitesse completed a debt restructuring
transaction that resulted in the conversion of 96.7% of the
Company's 2024 Debentures into a combination of cash, common
stock, Series B Preferred Stock and 2014 Debentures. With respect
to the remaining 3.3% of the 2024 Debentures, Vitesse settled its
obligations in cash. Additionally, Vitesse repaid $5.0 million of
its $30.0 million Senior Term Loan, the terms of which were
amended as part of the debt restructuring transactions.
Vitesse incurred a net loss of $1.11 million in 2012, a net loss
of $14.81 million in 2011, and a net loss of $20.05 million in
2010.
The Company's balance sheet at Sept. 30, 2012, showed
$56.61 million in total assets, $80.63 million in total
liabilities, and a $24.01 million total stockholders' deficit.
VITRO SAB: Wants $1.6BB Judgment vs. Bondholders in Mexican Court
-----------------------------------------------------------------
Brian Mahoney at Bankruptcy Law360 reports that Vitro SAB de CV
said Monday it was seeking a $1.6 billion judgment in Mexican
court against a group of bondholders, including several private
equity companies, for attempting to scuttle the company's
restructuring plan and force it into involuntary bankruptcy.
Bankruptcy Law360 relates that Vitro wants money currently held in
a Mexican trust for damages related to the bondholders' rejection
of its restructuring plan, which was approved by a Mexican court
in February but subsequently rejected by U.S. state and appeals
courts.
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.
On June 13, 2012, U.S. Bankruptcy Judge Harlin "Cooter" Hale in
Dallas entered a ruling that precluded Vitro from enforcing
its Mexican reorganization plan in the U.S. Vitro's appeal is
pending.
In November, the U.S. Court of Appeals Judge Carolyn King ruled
that Vitro SAB won't be permitted to enforce its bankruptcy
reorganization plan in the U.S. She said that Vitro "has not
shown that there exist truly unusual circumstances necessitating
the release" preventing bondholders from suing subsidiaries.
W.R. GRACE: Fresenius Medical Continues to Monitor Case
-------------------------------------------------------
Fresenius Medical Care AG & Co. KGaA continues to monitor the
Chapter 11 cases of W.R. Grace & Co., according to its Form 6-K
filing with the U.S. Securities and Exchange Commission for the
month of October 2012.
Fresenius was originally formed as a result of a series of
transactions it completed pursuant to the Agreement and Plan of
Reorganization dated as of February 4, 1996, by and between W.R.
Grace & Co. and Fresenius SE. At the time of the Merger, a W.R.
Grace & Co. subsidiary known as W.R. Grace & Co.-Conn. had, and
continues to have, significant liabilities arising out of
product-liability related litigation (including asbestos-related
actions), pre-Merger tax claims and other claims unrelated to
National Medical Care, Inc., which was W.R. Grace & Co.'s
dialysis business prior to the Merger. In connection with the
Merger, W.R. Grace & Co.-Conn. agreed to indemnify the Company,
FMCH, and NMC against all liabilities of W.R. Grace & Co.,
whether relating to events occurring before or after the Merger,
other than liabilities arising from or relating to NMC's
operations. W.R. Grace & Co. and certain of its subsidiaries
filed for reorganization under Chapter 11 of the U.S. Bankruptcy
Code on April 2, 2001.
Prior to and after the commencement of the Grace Chapter 11
Proceedings, class action complaints were filed against W.R.
Grace and FMCH by plaintiffs claiming to be creditors of W.R.
Grace & Co.-Conn., and by the asbestos creditors' committees on
behalf of the W.R. Grace & Co. bankruptcy estate in the Grace
Chapter 11 Proceedings, alleging, among other things that the
Merger was a fraudulent conveyance, violated the uniform
fraudulent transfer act and constituted a conspiracy. All such
cases have been stayed and transferred to or are pending before
the U.S. District Court as part of the Grace Chapter 11
Proceedings.
In 2003, the Company reached agreement with the asbestos
creditors' committees on behalf of the W.R. Grace & Co.
bankruptcy estate and W.R. Grace & Co. in the matters pending in
the Grace Chapter 11 Proceedings for the settlement of all
fraudulent conveyance and tax claims against it and other claims
related to the Company that arise out of the bankruptcy of W.R.
Grace & Co.
Under the terms of the settlement agreement as amended,
fraudulent conveyance and other claims raised on behalf of
asbestos claimants will be dismissed with prejudice and the
Company will receive protection against existing and potential
future W.R. Grace & Co. related claims, including fraudulent
conveyance and asbestos claims, and indemnification against
income tax claims related to the non-NMC members of the W.R.
Grace & Co. consolidated tax group upon confirmation of a W.R.
Grace & Co. bankruptcy reorganization plan that contains such
provisions. Under the Settlement Agreement, the Company will pay
a total of $115,000 without interest to the W.R. Grace & Co.
bankruptcy estate, or as otherwise directed by the Court, upon
plan confirmation. No admission of liability has been or will be
made. The Settlement Agreement has been approved by the U.S.
District Court. In January and February 2011, the U.S. Bankruptcy
Court entered orders confirming the plan of reorganization and
the confirmation orders were affirmed by the U.S. District Court
on January 31, 2012. Multiple parties have appealed to the Third
Circuit Court of Appeals and the plan of reorganization will not
be implemented until the appeals are finally resolved.
Fresenius is engaged primarily in providing dialysis services and
manufacturing and distributing products and equipment for the
treatment of end-stage renal disease.
About W.R. Grace
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally.
The company and its debtor-affiliates filed for chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura
Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP,
represent the Debtors in their restructuring efforts. The Debtors
hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.
Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent
the Official Committee of Unsecured Creditors. The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice. David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA.
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla
R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official
Committee of Asbestos Personal Injury Claimants. The Asbestos
Committee of Property Damage Claimants tapped Scott Baena, Esq.,
and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod,
LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel, LLP, represents the Official Committee of
Equity Security Holders.
W.R. Grace obtained confirmation of a plan co-proposed with the
Official Committee of Asbestos Personal Injury Claimants, the
Official Committee of Equity Security Holders, and the Asbestos
Future Claimants Representative. The Chapter 11 plan is built
around an April 2008 settlement for all present and future
asbestos personal injury claims, and a subsequent settlement for
asbestos property damage claims. Implementation of the Plan has
been held up by appeals in District Court from various parties,
including a group of prepetition bank lenders and the Official
Committee of Unsecured Creditors.
District Judge Ronald Buckwalter on Jan. 31, 2012, entered an
order affirming the bankruptcy court's confirmation of W.R. Grace
& Co. and its debtor affiliates' Plan of Reorganization.
Bankruptcy Judge Judith Fitzgerald had approved the Plan on
Jan. 31, 2011.
On April 20, 2012, the company filed a motion with the Bankruptcy
Court to approve definitive agreements among itself, co-proponents
of the Plan, BNSF railroad, several insurance companies and the
representatives of Libby asbestos personal injury claimants, to
settle objections to the Plan. Pursuant to the agreements, the
Libby claimants and BNSF would forego any further appeals to the
Plan.
Bankruptcy Creditors' Service, Inc., publishes W.R. Grace
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
W.R. GRACE: ARD Specialist Joins Libby's Card Staff
---------------------------------------------------
The Daily Inter Lake reports Dr. Alisa Koval has joined the staff
at the Center for Asbestos Related Disease in Libby.
The clinic has had a burgeoning caseload in recent years due to
widespread asbestos disease linked to exposure from the former
W.R. Grace & Co. vermiculite mine at Libby. Nearly 3,000
patients with varying levels of asbestos disease use the clinic
for health-care services.
Koval will provide asbestos-related health screenings and chronic
asbestos disease management for patients one week each month.
She also is an active participant in the Libby Epidemiological
Research Program.
Her research interests include the characterization of pulmonary
and autoimmune disease presentation associated with Libby
amphibole asbestos.
She is based at National Jewish Health in Denver, where she works
in the Department of Environmental and Occupational Health
Sciences. Koval is a recent graduate of the Occupational and
Environmental Medicine Residency program at the Mount Sinai
School of Medicine in New York City, where she worked closely
with Dr. Stephen Levin.
She has been focusing on Libby amphibole asbestos for the past
2-1/2 years.
"Her commitment to the people of Libby and her knowledge of Libby
amphibole asbestos will be a great asset to CARD patients," said
Dr. Brad Black, medical director of the clinic.
Over the past few years, the clinic has emerged as a national
center of excellence in addressing health-care issues associated
with Libby asbestos exposure, Black added.
Koval began her education at the University of Michigan, earning
a Bachelor of Science degree in biology with honors, followed by
a Master of Health Service Administration degree.
After spending a year as an administrative fellow at The
Children's Hospital of Denver, she went on to earn her medical
degree from the Georgetown University School of Medicine. Prior
to beginning her residency training, she worked as an internal
consultant at New York-Presbyterian Hospital in its Six Sigma
program. She stayed on to complete her training in general
preventive medicine and public health, and received the
Distinguished Housestaff Award in 2009. Koval completed her
Master of Public Health degree from Columbia University.
About W.R. Grace
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally.
The company and its debtor-affiliates filed for chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura
Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP,
represent the Debtors in their restructuring efforts. The Debtors
hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.
Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent
the Official Committee of Unsecured Creditors. The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice. David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA.
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla
R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official
Committee of Asbestos Personal Injury Claimants. The Asbestos
Committee of Property Damage Claimants tapped Scott Baena, Esq.,
and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod,
LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel, LLP, represents the Official Committee of
Equity Security Holders.
W.R. Grace obtained confirmation of a plan co-proposed with the
Official Committee of Asbestos Personal Injury Claimants, the
Official Committee of Equity Security Holders, and the Asbestos
Future Claimants Representative. The Chapter 11 plan is built
around an April 2008 settlement for all present and future
asbestos personal injury claims, and a subsequent settlement for
asbestos property damage claims. Implementation of the Plan has
been held up by appeals in District Court from various parties,
including a group of prepetition bank lenders and the Official
Committee of Unsecured Creditors.
District Judge Ronald Buckwalter on Jan. 31, 2012, entered an
order affirming the bankruptcy court's confirmation of W.R. Grace
& Co. and its debtor affiliates' Plan of Reorganization.
Bankruptcy Judge Judith Fitzgerald had approved the Plan on
Jan. 31, 2011.
On April 20, 2012, the company filed a motion with the Bankruptcy
Court to approve definitive agreements among itself, co-proponents
of the Plan, BNSF railroad, several insurance companies and the
representatives of Libby asbestos personal injury claimants, to
settle objections to the Plan. Pursuant to the agreements, the
Libby claimants and BNSF would forego any further appeals to the
Plan.
Bankruptcy Creditors' Service, Inc., publishes W.R. Grace
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
W.R. GRACE: Completes Purchase of Noblestar Assets
--------------------------------------------------
W. R. Grace & Co. has completed its acquisition of the assets of
Noblestar Catalysts Co., Ltd, a Qingdao, China-based manufacturer
of fluid catalytic cracking (FCC) catalysts, catalyst
intermediates and related products used in the petroleum refining
industry. Grace is the worldwide leader in FCC catalysts.
Qingdao Bureau of Commerce Vice Director General, Cong Yan,
welcomed Grace's investment during the ribbon cutting ceremony
and said, "Qingdao is a leading economic center in China. We
welcome foreign investment, especially from companies like Grace,
which has world-class, leading technologies that can help develop
our fast-growing petrochemical industry while also acknowledging
environmental and safety concerns."
"The successful acquisition of Noblestar's assets in Qingdao is
another milestone in Grace's long relationship with China. And it
is an important step in our strategy to provide world-class
products and support to the petroleum refining industry," said
Grace's Chairman and CEO Fred Festa. "Our goal is for customers
to look to Grace for innovative technology and industry-leading
technical service, as well as a globally integrated manufacturing
network that aligns with the world's demand." Grace expects to
make additional investments at the Qingdao site for
environmental, safety and manufacturing upgrades.
Chao Cui, CEO and President of Noblestar Catalysts, said, "We have
been happy and proud to be a business partner of Grace's refining
technologies business for years and we are excited to continue a
business relationship with Grace in the future."
Grace first established a presence in China when it founded Grace
China Ltd. in 1986 as the first Wholly Foreign-Owned Company to do
business in the People's Republic of China -- through its can
sealants plant in Shanghai.
Currently, Grace operates 5 manufacturing facilities, 3 sales
offices and 2 technical service centers in mainland China,
including its Asia Pacific regional headquarters in Shanghai.
About Noblestar
Noblestar -- http://www.noblestar.com.cn/-- located in Qingdao,
China, has been specialized in the manufacturing of FCC catalysts
and additives for petrochemicals since 2001. Noblestar has been
involved in the rare earth business from 2010. Noblestar employs
150 people, consisting of experienced R&D and engineering
professionals and a team of skilled workers. It had sales of 680
million RMB (appx. 108 million USD) in 2011.
About W.R. Grace
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally.
The company and its debtor-affiliates filed for chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura
Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP,
represent the Debtors in their restructuring efforts. The Debtors
hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.
Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent
the Official Committee of Unsecured Creditors. The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice. David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA.
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla
R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official
Committee of Asbestos Personal Injury Claimants. The Asbestos
Committee of Property Damage Claimants tapped Scott Baena, Esq.,
and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod,
LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel, LLP, represents the Official Committee of
Equity Security Holders.
W.R. Grace obtained confirmation of a plan co-proposed with the
Official Committee of Asbestos Personal Injury Claimants, the
Official Committee of Equity Security Holders, and the Asbestos
Future Claimants Representative. The Chapter 11 plan is built
around an April 2008 settlement for all present and future
asbestos personal injury claims, and a subsequent settlement for
asbestos property damage claims. Implementation of the Plan has
been held up by appeals in District Court from various parties,
including a group of prepetition bank lenders and the Official
Committee of Unsecured Creditors.
District Judge Ronald Buckwalter on Jan. 31, 2012, entered an
order affirming the bankruptcy court's confirmation of W.R. Grace
& Co. and its debtor affiliates' Plan of Reorganization.
Bankruptcy Judge Judith Fitzgerald had approved the Plan on
Jan. 31, 2011.
On April 20, 2012, the company filed a motion with the Bankruptcy
Court to approve definitive agreements among itself, co-proponents
of the Plan, BNSF railroad, several insurance companies and the
representatives of Libby asbestos personal injury claimants, to
settle objections to the Plan. Pursuant to the agreements, the
Libby claimants and BNSF would forego any further appeals to the
Plan.
Bankruptcy Creditors' Service, Inc., publishes W.R. Grace
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
WOUND MANAGEMENT: Extends Forbearance with Tonaquint to Jan. 29
---------------------------------------------------------------
Tonaquint, Inc., and Wound Management Technologies, Inc.,
previously entered into a forbearance agreement with respect to
that certain Secured Convertible Promissory Note in the original
principal amount of $560,000, pursuant to which Tonaquint agreed,
among other things, to refrain from exercising its rights under
the Note through Oct. 16, 2012, subject to certain optional
extensions.
On Dec. 5, 2012, Tonaquint and the Company entered into a First
Amendment to Forbearance Agreement, extending the period of
forbearance on the Note through Jan. 29, 2013, and providing for
three optional 30-day extension periods for which the Company
would be required to pay a total of $20,000 in cash or, at the
Company's election, in a combination of cash and stock.
A copy of the Amended Forbearance is available for free at:
http://is.gd/QHVgWD
About Wound Management
Fort Worth, Texas-based Wound Management Technologies, Inc.,
markets and sells the patented CellerateRX(R) product in the
expanding advanced wound care market; particularly with respect to
diabetic wound applications.
Pritchett, Siler & Hardy, P.C., in Salt Lake City, Utah, expressed
substantial doubt about Wound Management's ability to continue as
a going concern, following the Company's results for the fiscal
year ended Dec. 31, 2011. The independent auditors noted that the
Company has incurred substantial losses and has a working capital
deficit.
The Company's balance sheet at Sept. 30, 2012, showed $2.76
million in total assets, $6.36 million in total liabilities and a
$3.60 million deficit.
WYLDFIRE ENERGY: Files Amended Disclosure Statement
---------------------------------------------------
Wyldfire Energy, Inc., has filed a first amended disclosure
statement in support of its plan of reorganization.
The classification and treatment of claims under the disclosure
statement are:
A. Class 1 (Secured Claims) - As of the time the Plan and
Disclosure Statement , there were no holders of Allowed
Secured Claims.
B. Class 2 (Property Tax Claims) are Secured Claims and shall
be paid in full. Total filed claims is $569.24 and
estimated recovery is 100%.
C. Class 3 (Unsecured General Claims) will be paid in full in
one installment being payable on or within 60 days of the
respective Initial Distribution Date for each Allowed
Class 3 Claim. Total filed claims is $367,029 and
estimated recovery is 100%.
D. Class 4 (Bubba Riggs Claim) will be paid up to the maximum
claim amount of $5.27 million. The filed disputed claim
is amount is up $54.39 million.
E. Class 5 (Riley-Huff Claim) is scheduled for the disputed
amount of $11.67 million. Any Allowed Riley-Huff Claim
will be paid by the Debtor on the terms as may be agreed
upon by the Debtor and Riley-Huff. If no agreement is
reached then the Allowed Riley-Huff claim will be paid in
five years.
F. Class 6 (Debt Claims held by Debtor's Principal) is
estimated to be $275,000. Class 6 Creditors will receive
no Distribution on account of such loans unless and until
higher Classes are paid in full.
G. Class 7 (Interests in the Debtor) will receive no
distribution until full payment of all other Classes have
occurred.
A copy of the amended disclosure statement is available for free
at http://bankrupt.com/misc/WYLDFIRE_ENERGY_ds_amended.pdf
About Wyldfire Energy
Palo Pinto, Texas-based Wyldfire Energy, Inc., filed a bare-bones
Chapter 11 petition (Bankr. N.D. Tex. Case No. 12-70239) in
Wichita Falls, Texas, on June 20, 2012. Tamara Ford, a 100%
stockholder, signed the Chapter 11 petition. Judge Harlin DeWayne
Hale oversees the case. The Law Offices of Ronald L. Yandell,
Esq., serves as the Debtor's counsel.
YOUNGWOO MOON: Hotel Owner's Case Converted to Chapter 7
--------------------------------------------------------
Bankruptcy Judge John S. Dalis granted the request of Mission Oaks
National Bank to convert the Chapter 11 case of Youngwoo Moon, a
Korean national, to a liquidation under Chapter 7 of the
Bankruptcy Code.
The bank sought conversion or dismissal of the case.
Youngwoo Moon owns a Howard Johnson Motel that opened in January
2012 on roughly seven acres of land in Brunswick, Georgia. The
Motel is operated by a limited liability corporation of which Mr.
Moon is the sole shareholder. Mr. Moon and his family live in the
Motel.
Mr. Moon bought the Motel Property in April 2011 for $1.25
million, with most of the purchase price financed by Mission Oaks.
Mr. Moon filed for Chapter 11 bankruptcy (Bankr. S.D. Ga. Case No.
12-20731) in Brunswick Division, to stop Mission Oaks's
foreclosure action.
The Court noted there is equity in the Motel Property, although
exactly how much is unclear. Mr. Moon has spent over $400,000 of
his own money on renovations, and according to Mr. Moon's
appraiser, the value of the Motel Property is $2,171,500. The
appraiser also estimated it would take two years to sell the Motel
Property if it were put on the market at the appraised value.
A copy of the Court's Dec. 13, 2012 Opinion and Order is available
at http://is.gd/jeia26from Leagle.com.
Z TRIM HOLDINGS: Edward Smith Discloses 78.9% Equity Stake
----------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Edward B. Smith, III, and his affiliates
disclosed that, as of Dec. 7, 2012, they beneficially own
32,338,079 shares of common stock of Z Trim Holdings, Inc.,
representing 78.9% of the shares outstanding. Mr. Smith
previously reported beneficial ownership of 31,859,570 common
shares or a 72.4% equity stake as of Oct. 5, 2012. A copy of the
amended filing is available for free at http://is.gd/00DJyU
About Z Trim
Mundelein, Ill.-based Z Trim Holdings, Inc., is a functional food
ingredient company which provides custom product solutions that
help answer the food industry's problems. Z Trim's revolutionary
technology provides value-added ingredients across virtually all
food industry categories. Z Trim's all-natural products, among
other things, help to reduce fat and calories, add fiber, provide
shelf-stability, prevent oil migration, and add binding capacity
-- all without degrading the taste and texture of the final food
products.
M&K CPAs,PLLC, in Houston, Texas, expressed substantial doubt
about the Company's ability to continue as a going concern
following the 2011 financial results. The independent auditors
noted that the Company had a working capital deficit and
reoccurring losses as of Dec. 31, 2011.
The Company reported a net loss of $6.94 million in 2011, compared
with a net loss of $10.91 million in 2010.
The Company's balance sheet at Sept. 30, 2012, showed $4.41
million in total assets, $24.99 million in total liabilities,
$6.36 million in total commitment and contingencies, and a $26.93
million total stockholders' deficit.
ZALE CORP: Stockholders Elect 8 Directors to Board
--------------------------------------------------
Zale Corporation held its annual meeting of stockholders on
Dec. 6, 2012, at which the stockholders elected eight directors
for terms that will expire at the 2013 annual meeting of
stockholders, namely:
(1) Neale Attenborough;
(2) Yuval Braverman;
(3) David F. Dyer;
(4) Kenneth B. Gilman;
(5) Theo Killion;
(6) John B. Lowe, Jr.;
(7) Joshua Olshansky; and
(8) Beth M. Pritchard.
The stockholders approved the proposal to amend the Zale
Corporation 2011 Omnibus Incentive Plan and accepted an advisory
vote to approve the Company's executive compensation. The
stockholders also ratified the appointment of Ernst & Young LLP as
the Company's independent registered public accounting firm for
the fiscal year ending July 31, 2013.
The Board of Directors of Zale approved an amendment to the Zale
Corporation 2011 Omnibus Incentive Compensation Plan on Sept. 28,
2012.
The 2011 Omnibus Incentive Plan provides for the grant to
officers, employees, and other service providers of the Company
and its affiliates of options to purchase shares of the Company's
common stock and other awards, which awards may be incentive stock
options, non-qualified stock options, stock appreciation rights,
restricted stock awards, restricted stock units, incentive awards,
other stock awards, dividend equivalents and cash awards. The
2011 Omnibus Incentive Plan replaced the Company's 2003 Stock
Incentive Plan and the Company's Non-Employee Directors' Equity
Compensation.
Under the amended 2011 Omnibus Incentive Plan, the maximum
aggregate number of shares of common stock which may be subject to
Awards under the plan is (i) 1,012,853 shares of common stock
minus (ii) that number of shares of common stock that are
represented by awards granted after Sept. 30, 2012.
The amendment of the 2011 Omnibus Incentive Plan also increased
the maximum amount payable under cash Awards to any individual
from $1.8 million to $2.5 million with respect to any 12-month
performance period.
About Zale Corporation
Based in Dallas, Texas, Zale Corporation (NYSE: ZLC) --
http://www.zalecorp.com/-- is a specialty retailer of diamonds
and other jewelry products in North America, operating
approximately 1,900 retail locations throughout the United States,
Canada and Puerto Rico, as well as online. Zale Corporation's
brands include Zales Jewelers, Zales Outlet, Gordon's Jewelers,
Peoples Jewellers, Mappins Jewellers and Piercing Pagoda. Zale
also operates online at http://www.zales.com/,
http://www.zalesoutlet.com/,
http://www.gordonsjewelers.com/and http://www.pagoda.com/
Zale Corp. incurred a net loss of $27.31 million for the year
ended July 31, 2012, a net loss of $112.30 million for the year
ended July 31, 2011, and a net loss of $93.67 million for the year
ended July 31, 2010.
The Company's balance sheet at Oct. 31, 2012, showed $1.33 billion
in total assets, $1.18 billion in total liabilities and
$151.96 million in stockholders' investment.
ZOGENIX INC: FDA Rejects Zohydro ER for Chronic Pain Management
---------------------------------------------------------------
Zogenix, Inc., announced that the U.S. Food and Drug
Administration's Anesthetic and Analgesic Drug Products Advisory
Committee voted 2-11 [with 1 abstention] against the approval of
Zohydro ER (hydrocodone bitartrate extended-release capsules), an
extended-release formulation of hydrocodone without acetaminophen,
for the management of moderate-to-severe chronic pain when a
continuous, around-the-clock opioid analgesic is needed for an
extended period of time.
The Prescription Drug User Fee Act date for completion of FDA
review of Zohydro ER New Drug Application for approval is March 1,
2013. The AADPAC provides FDA with independent expert advice and
recommendations, but the final decision regarding approval of a
medication is made by the FDA.
About Zogenix Inc.
Zogenix, Inc. (NASDAQ: ZGNX), with offices in San Diego and
Emeryville, California, is a pharmaceutical company
commercializing and developing products for the treatment of
central nervous system disorders and pain.
Ernst & Young LLP, in San Diego, Calif., issued a "going concern"
qualification on the consolidated financial statements for the
year ended Dec. 31, 2011, citing recurring losses from operations
and lack of sufficient working capital.
The Company reported a net loss of $83.90 million in 2011, a net
loss of $73.56 million in 2010, and a net loss of $45.88 million
in 2009.
The Company's balance sheet at Sept. 30, 2012, showed $91.30
million in total assets, $78.01 million in total liabilities and
$13.28 million in total stockholders' equity.
* Banking Ratings Won't Return to Pre-Crisis Levels, Moody's Says
-----------------------------------------------------------------
During 2012, the rising sensitivity of market participants to
financial institutions' risk and reduced expectations of
government support have shifted the equilibrium point for
assessments of bank credit strength, as reflected in Moody's
ratings. These issues are discussed in Moody's Investors Service's
new special comment "Rising Risks, Receding Government Support,
Cause Shift in Bank Credit Profiles", available to subscribers on
moodys.com.
Moody's new report discusses the substantial and inherent risks of
banks, including high leverage, reliance on confidence-sensitive
funding, high sovereign risk correlations, opacity and risk-taking
that came to the fore in the 2007-08 financial crisis and have
been reappraised in its wake. The crisis has also raised questions
about the capacity and willingness of governments to provide
support to distressed banks. Further, ongoing macroeconomic
instability and uncertainties in the operating environment mean
banks' fundamental credit risks will continue to be under stress.
"Inherent risks facing banks are even more in focus as government
support recedes," said Greg Bauer, a Moody's Managing Director,
"The promise of implicit or explicit government support has
historically served to moderate the banking sector's fundamental
riskiness for creditors, but the numerous and sometimes massive
bank failures during the recent crisis have called that basic
assumption into question."
Moody's notes that without the extraordinary liquidity and
capital-replenishment measures taken by authorities during the
2007-08 financial crisis, bank defaults and failures would have
been far more wide-spread. Still, the ramifications of this crisis
are expected to linger, and Moody's says that even following
economic recovery and sovereign stabilization, credit ratings and
standalone assessments are unlikely to revert to former levels.
Creditors will be exposed to increased risk of bank default for
the foreseeable future.
* Moody's Sees Muted Impact of House Price Declines in Canada
-------------------------------------------------------------
Signs of a softening real estate market carry minimal credit
implications for Canada's cities, says Moody's Investors Service
in the report "House Price Declines Have Muted Impact on Canadian
City Finances". Moderation in house price growth will likely have
very little impact on the financial positions of the Canadian
cities, given that they have flexibility that ensures growth in
property tax revenues will be stable.
While home price depreciation would depress taxable values,
municipalities in Canada are able to adjust their millage rates to
compensate for changes in assessment values, Moody's explains in
the report. "Even if the recent trend of house price growth
moderation or even depreciation were to persist, municipalities
would be able to adjust for assessment changes and therefore
maintain relatively stable property tax revenues," says Jennifer
Wong, the Moody's Assistant Vice President -- Analyst who was the
lead author of the report.
Reviewing the finances and property tax procedures for Vancouver,
Toronto and Montreal, Moody's finds they are all well positioned
to handle softer housing prices.
The October house price index released by Teranet -- National Bank
showed a 0.6% month-on-month decline in house prices in Toronto
and a 0.3% decline in Montreal. Vancouver registered a marginal
gain of 0.1% on the month, but recorded a 1% decline in the year
to October. However, this moderation follows a significant
increase in house prices over the previous three years. House
prices rose at a compound annual rate over the three years to
September 2012 of 5.2% in Vancouver, 7.9% in Toronto and 5.6% in
Montreal on the same index.
* Moody's Says US Life Insurers Vulnerable to Low Interest Rates
----------------------------------------------------------------
US life insurers will be vulnerable to the impact of continued low
interest rates on earnings, says Moody's Investors Service in its
new special comment "Interest Rates Low, Low, Low: Are US Life
Insurers Concerned Enough?" Interest rates in the US remain at
historically low levels, with the 10-year US Treasury note failing
to break 2% in over six months.
Moody's summarized 20 life insurers' responses to the rating
agency's survey of 2012-2016 GAAP earnings projections under
several scenarios, including one that assumes low interest rates
and low equity returns.
"Our surveyed insurers responded with projected earnings that are
relatively insensitive to low interest rates," said Neil Strauss,
a Moody's Vice President -- Senior Credit Officer. "But we believe
that if rates remain at current levels beyond 2015, there would be
significant earnings charges and loss of capital, leading to
rating pressure."
Moody's notes that the impact of low rates on US life insurers has
been relatively modest so far, as companies have lowered crediting
rates to maintain interest margins, raised prices on new business
and discontinued interest-sensitive products. But as the gap
widens between earned interest rates and interest rates implicit
in pricing and reserving assumptions, Moody's sees a trend toward
higher earnings charges and capital hits from spread compression.
The report also notes that until now companies' long duration
investment portfolios with gradual turnover have muted the effect
of low reinvestment rates, and current accounting practices have
delayed recognition of meaningful impacts from low interest rates.
However, as insurers' investment portfolios earning the higher
rates of yesteryear are shrinking and crediting rates inch closer
to contractual minimum interest rates, profitability will be
pressured and accounting writedowns may be required.
Moody's believes that insurers may be optimistic in their
projections given the accounting flexibility allowing non
immediate recognition of low interest rates and underestimation of
the impacts of adverse macroeconomic environments and tail risk.
* Moody's Says Negative Accreditation Bring Short-Term Risks
------------------------------------------------------------
Negative accreditation actions against US colleges and
universities are on the rise, signaling a much tougher stance on
the part of accreditators that is credit negative for the sector
over the short term, says Moody's Investors Service. Over the next
few years, the number of universities placed on warning or that
lose their accreditation is likely to increase, says Moody's in
the report "Accreditation Risks on the Rise for US Higher
Education."
Over the long term, however, Moody's says the sector will probably
benefit from the greater scrutiny.
"Tougher standards imposed by accrediting bodies will contribute
to increased transparency and improved cost efficiencies, thereby
reducing some of the public and political pressure facing the
sector," says Caitlin Bertha, the Moody's analyst who was lead
author of the report.
Negative accreditation actions taken against US colleges and
universities have increased by almost 50% over the last three
years, to 79 actions last year. Accreditators are citing colleges
and universities for a broad range of issues that include
deficiencies in governance, integrity, and assessment of student
learning outcomes.
Failure to comply with accrediting standards can lead to various
levels of sanctions and reputational damage, but the most severe
risk is withdrawal of accreditation. Loss of accreditation will
usually lead to the closure of an institution, although not
necessarily to a default on its debt.
A college lacking accreditation is barred from receiving federal
Title IV funding, commonly known as federal financial aid, which
in Fiscal Year 2011 comprised approximately a third of the median
operating revenue of Moody's rated universities.
Not long ago, accreditation sanctions were rare. Moody's says the
more active and aggressive stance of the accreditators comes in
response to growing government criticism of poor disclosure about
quality, pricing and outcomes, as well as inefficient cost
management among colleges and universities.
Recent actions include a withdrawal of accreditation for Mountain
State University, which has appealed the action. The West Virginia
university redeemed its bonds earlier this month, which had a
rating of B1 before Moody's withdrew their rating.
On September 7, Moody's lowered the general obligation rating for
the San Francisco Community College District's bonds to A1 from
Aa2 and assigned a negative outlook as a result of the district's
weak fiscal position and possible loss of accreditation after its
accreditator placed the college's accreditation on "Show Cause."
Accreditors placed Pennsylvania State University on warning in the
wake of the Freeh report, which highlighted deficiencies in Penn
State's governance and management. And on December 11, the
University of Virginia received an accreditation warning over its
board governance and its faculty's role in that governance.
* Moody's Sees More Stable Ratings in Infrastructure Sector
-----------------------------------------------------------
Over the last thirty years, the infrastructure sector has
demonstrated more stable ratings and therefore better long-term
credit quality than has the general corporate sector, Moody's
Investors Service says in the new report "Infrastructure Default
and Recovery Rates 1983-2012H1." The report is Moody's first on
the historical credit performance of Moody's-rated long-term
infrastructure debt.
Especially stable has been the credit quality of US municipal
infrastructure debt, with ratings that have shown only about a
sixth of the volatility of ratings on general corporate debt.
In general, rating changes have been somewhat less frequent among
all investment-grade infrastructure debt issuers than they have
for non-financial corporate debt issuers, as well as for issuers
in the highest speculative-grade rating category of Ba. The
average stability of investment-grade infrastructure ratings
derives from an overwhelmingly lower historical probability of
being downgraded within a twelve-month period relative to non-
financial corporate issuers: the average downgrade rate since 1983
for total infrastructure debts is 5.1 compared with 14.4 for non-
financial corporate issuers. Much of this difference is
attributable to the very low propensity of US municipal
infrastructure debts to be downgraded; but the rate for corporate
infrastructure debts, at 12.3, is still below the average rate for
non-financial corporate issuers.
The new Moody's study compares historical default rates, rating
transitions, recovery rates and rating accuracy measures for
infrastructure debt against those of non-financial corporate
issuers. The study also looks separately at the two broad
categories of debt that makes up the infrastructure sector-rated
US municipal debt, which currently totals $800 billion in
issuance, and rated corporate infrastructure debt, which totals
$2.4 trillion in issuance.
"A key purpose of the study is to better understand ratings
performance at both the aggregate and sub-sector level, keeping in
mind the limitation that the more granular the analysis, the less
robust the conclusions," says Merxe Tudela, Vice President --
Senior Analyst, and an author of the report. "For example, to date
no rated airport credit has defaulted, but that should not imply
that all airports should therefore be rated Aaa."
In general, the non-financial corporate issuers and corporate
infrastructure issuers have broadly similar credit profiles, says
Moody's, although non-financial corporates have displayed 20% more
volatility in their ratings than corporate infrastructure. The one
exception is Ba-rated debt, for which both loss and default rates
are lower for corporate infrastructure debt than for non-financial
corporate debt.
Moody's measures volatility by looking at the rate of upgrades and
downgrades, weighted by the number of notches of each rating
range.
The study also finds that single-A senior credit loss rates for
corporate infrastructure debts (which are about a third of total
corporate infrastructure debts) and non-financial corporate
issuers are very similar: A-rated corporate infrastructure debts
have higher default rates but lower losses given default than non-
financial corporate issuers.
Default rates for Baa-rated corporate infrastructure debts are
also very similar to Baa-rated non-financial corporates. However,
as recoveries have historically been better among the
infrastructure debts, total credit loss rates have been about 30%
lower than those of non-financial corporates.
Over the last 30 years, infrastructure ratings have on average
displayed the same power in distinguishing defaulters from non-
defaulters as have the ratings of non-financial corporates. Over
the study period, one measure of rating accuracy, the Average
Position of defaulters, has been 0.95 for total infrastructure
debts compared with 0.91 for non-financial corporates, with 1
being a perfect score.
"The necessity of infrastructure investments can reduce business
and operating risk relative to corporate industrial issuers," says
Albert Metz, Managing Director and an author of the report.
"Infrastructure credits tend to be characterized by the long-term
importance of their underlying business (sometimes delivering a
public service), their asset-heavy capital-intensive nature, their
generally low-to-manageable operating risk, and their ability to
support long-term debt, often at higher levels of gearing than is
typical for similarly-rated non-financial corporates."
* American College of Bankruptcy Names Robert Lapowsky Fellow
-------------------------------------------------------------
Stevens & Lee Shareholder Robert Lapowsky has been named a Fellow
of the American College of Bankruptcy. He will be formally
inducted on March 15, 2013 in Washington, D.C.
The American College of Bankruptcy is a national invitation-only
professional honorary society which extends fellowship invitations
to recognize nominees for their excellence in the bankruptcy and
insolvency fields.
A Stevens & Lee Shareholder and co-chair of its Bankruptcy and
Financial Restructuring Department, Mr. Lapowsky has been an
active practitioner in the area of bankruptcy and creditors'
rights since 1979. He represents financial institutions, debtors,
creditors' committees and trustees in all aspects of the corporate
reorganization practice.
About Stevens & Lee
Among the 200 largest law firms in the nation, Stevens & Lee --
http://www.stevenslee.com-- is part of a multidisciplinary
professional services platform which also consists of a health
care risk consulting business, a FINRA-licensed investment bank,
an insurance consultancy specializing in the risk finance, premium
finance and life settlement markets, a D&O and E&O insurance risk
consulting business, a swap and derivative advisory business and
federal and state lobbying units. Its 240 multidisciplinary
professionals represent clients throughout the Mid-Atlantic region
and across the country from 14 offices in Pennsylvania, New
Jersey, Delaware, New York City and South Carolina.
* Recent Small-Dollar & Individual Chapter 11 Filings
-----------------------------------------------------
In re Curtis Crane
Bankr. D. Ariz. Case No. 12-26138
Chapter 11 Petition filed December 8, 2012
In re Luis Medina
Bankr. N.D. Ill. Case No. 12-48288
Chapter 11 Petition filed December 9, 2012
In re Deborah Earle
Bankr. C.D. Calif. Case No. 12-50423
Chapter 11 Petition filed December 9, 2012
In re Tammye Dighero
Bankr. W.D. Ark. Case No. 12-74557
Chapter 11 Petition filed December 10, 2012
In re Bimal Dey
Bankr. D. Ariz. Case No. 12-26207
Chapter 11 Petition filed December 10, 2012
In re Brandi Young
Bankr. D. Ariz. Case No. 12-26191
Chapter 11 Petition filed December 10, 2012
In re Jose Rodriguez
Bankr. C.D. Calif. Case No. 12-50523
Chapter 11 Petition filed December 10, 2012
In re John Schulze
Bankr. E.D. Calif. Case No. 12-41197
Chapter 11 Petition filed December 10, 2012
In re Richard Lyman
Bankr. E.D. Calif. Case No. 12-41214
Chapter 11 Petition filed December 10, 2012
In re Jeffrey Moll
Bankr. D. Colo. Case No. 12-34882
Chapter 11 Petition filed December 10, 2012
In re Abraham Korotki
Bankr. D. Del. Case No. 12-13317
Chapter 11 Petition filed December 10, 2012
In re Launch, LLC
Bankr. D.D.C. Case No. Case No. 12-00811
Chapter 11 Petition filed December 10, 2012
See http://bankrupt.com/misc/dcb12-00811.pdf
represented by: Njinuwo Conrad Bayelle, Esq.
Law Office of Conrad Bayelle & Assoc.
E-mail: info@conbaylaw.com
In re Custom Business Technologies, Inc.
Bankr. S.D. Fla. Case No. 12-39468
Chapter 11 Petition filed December 10, 2012
See http://bankrupt.com/misc/flsb12-39468.pdf
represented by: Marie A. Lurie, Esq.
E-mail: malurie@comcast.net
In re Josephine McLeod
Bankr. E.D. Mich. Case No. 12-66747
Chapter 11 Petition filed December 10, 2012
In re Patrick McLeod
Bankr. E.D. Mich. Case No. 12-66747
Chapter 11 Petition filed December 10, 2012
In re Roger Tillman/ TMC Inc.
Bankr. E.D. Mich. Case No. 12-23532
Chapter 11 Petition filed December 10, 2012
See http://bankrupt.com/misc/mieb12-23532.pdf
represented by: Richard Todd Cook, Esq.
Jada Law PLLC
E-mail: rtcook@jadalaw.com
In re The Buffalo Jim and Rosenfeld Law Firm CHTD
Bankr. D. Nev. Case No. 12-23510
Chapter 11 Petition filed December 10, 2012
See http://bankrupt.com/misc/nvb12-23510.pdf
represented by: Steven L. Yarmy, Esq.
E-mail: sly@stevenyarmylaw.com
In re XSRE Paramus LLC
Bankr. S.D.N.Y. Case No. 12-14844
Chapter 11 Petition filed December 10, 2012
See http://bankrupt.com/misc/nysb12-14844.pdf
represented by: J. Ted Donovan, Esq.
Goldberg Weprin Finkel Goldstein LLP
E-mail: TDonovan@GWFGlaw.com
In re Kathy Price
Bankr. M.D. Tenn. Case No. 12-11245
Chapter 11 Petition filed December 10, 2012
In re Dianne Roebuck
Bankr. W.D. Tex. Case No. 12-53830
Chapter 11 Petition filed December 10, 2012
In re Patrick Roebuck
Bankr. W.D. Tex. Case No. 12-53830
Chapter 11 Petition filed December 10, 2012
In re Thanh Do
Bankr. N.D. Calif. Case No. 12-58769
Chapter 11 Petition filed December 11, 2012
In re Dog Wood Park of Northeast Florida, LLC
Bankr. M.D. Fla. Case No. 12-07861
Chapter 11 Petition filed December 11, 2012
See http://bankrupt.com/misc/flmb12-07861.pdf
represented by: Brett A. Mearkle, Esq.
Law Office of Brett A. Mearkle
E-mail: bmearkle@mearklelaw.com
In re Charles Bradford
Bankr. S.D. Fla. Case No. 12-39579
Chapter 11 Petition filed December 11, 2012
In re Kishan Patel
Bankr. N.D. Ill. Case No. 12-48451
Chapter 11 Petition filed December 11, 2012
In re Market Street Properties LLC
Bankr. N.D. Ill. Case No. 12-48537
Chapter 11 Petition filed December 11, 2012
See http://bankrupt.com/misc/ilnb12-48537.pdf
represented by: Jeffrey K. Gutman, Esq.
Gutman & Associates LLC
E-mail: jeffreykg4018@aol.com
In re Durward Raynor
Bankr. E.D.N.C. Case No. 12-08711
Chapter 11 Petition filed December 11, 2012
In re Leah Bader
Bankr. D. Ore. Case No. 12-39057
Chapter 11 Petition filed December 11, 2012
In re Larry Epley
Bankr. D.S.C. Case No. 12-07664
Chapter 11 Petition filed December 11, 2012
In re Daren Bowlby
Bankr. W.D. Wash. Case No. 12-48336
Chapter 11 Petition filed December 11, 2012
In re Soo Jung
Bankr. W.D. Wash. Case No. 12-22252
Chapter 11 Petition filed December 11, 2012
In re C K Trucking, LLC
Bankr. N.D. Ala. Case No. 12-72595
Chapter 11 Petition filed December 12, 2012
See http://bankrupt.com/misc/alnb12-72595.pdf
represented by: Marshall Entelisano, Esq.
MARSHALL A. ENTELISANO, PC
E-mail: evet@marshall-lawfirm.com
In re Hardev Motel, Inc.
Bankr. D. Ariz. Case No. 12-26383
Chapter 11 Petition filed December 12, 2012
See http://bankrupt.com/misc/azb12-26383.pdf
represented by: Ronald J. Ellett, Esq.
ELLETT LAW OFFICES, P.C.
E-mail: rjellett@ellettlaw.phxcoxmail.com
In re John Magar
Bankr. C.D. Calif. Case No. 12-24039
Chapter 11 Petition filed December 12, 2012
In re Young Lee
Bankr. C.D. Calif. Case No. 12-50693
Chapter 11 Petition filed December 12, 2012
In re Gregory Zavertnik
Bankr. N.D. Calif. Case No. 12-58774
Chapter 11 Petition filed December 12, 2012
In re Randolph Gardini
Bankr. S.D. Calif. Case No. 12-16256
Chapter 11 Petition filed December 12, 2012
In re Fifico Ltd. LLC
Bankr. D. Colo. Case No. 12-35073
Chapter 11 Petition filed December 12, 2012
See http://bankrupt.com/misc/cob12-35073.pdf
represented by: David M. Serafin, Esq.
LAW OFFICE OF DAVID SERAFIN
E-mail: david@davidserafinlaw.com
In re RAI Concrete, Inc.
Bankr. N.D. Ill. Case No. 12-48787
Chapter 11 Petition filed December 12, 2012
See http://bankrupt.com/misc/ilnb12-48787p.pdf
See http://bankrupt.com/misc/ilnb12-48787c.pdf
represented by: David R. Herzog, Esq.
HERZOG & SCHWARTZ, P.C.
E-mail: drhlaw@mindspring.com
In re Eric Norton
Bankr. D. Mass. Case No. 12-44258
Chapter 11 Petition filed December 12, 2012
In re Flagship Franchises of Minnesota, Inc.
dba Touching Lives Communities
Bankr. D. Minn. Case No. 12-36900
Chapter 11 Petition filed December 12, 2012
See http://bankrupt.com/misc/mnb12-36900.pdf
represented by: Edwin H. Caldie, Esq.
LEONARD, STREET AND DEINARD
E-mail: Edwin.Caldie@leonard.com
In re Steven Meldahl
Bankr. D. Minn. Case No. 12-46965
Chapter 11 Petition filed December 12, 2012
In re FMB Inc. Bagels-N-Hole Lot More
Bankr. E.D.N.Y. Case No. 12-77126
Chapter 11 Petition filed December 12, 2012
See http://bankrupt.com/misc/nyeb12-77126.pdf
Filed as Pro Se
In re New ITM, Inc.
Bankr. S.D.N.Y. Case No. 12-14868
Chapter 11 Petition filed December 12, 2012
See http://bankrupt.com/misc/nysb12-14868.pdf
represented by: Randall S. D. Jacobs, Esq.
Randall S. D. Jacobs, PLLC
E-mail: rsdjacobs@chapter11esq.com
In re Gift's Villa, LLC
Bankr. W.D.N.Y. Case No. 12-13732
Chapter 11 Petition filed December 12, 2012
See http://bankrupt.com/misc/nywb12-13732.pdf
represented by: James M. Joyce, Esq.
E-mail: jmjoyce@lawyer.com
In re Mulligan Printing Corporation
Bankr. M.D. Pa. Case No. 12-07097
Chapter 11 Petition filed December 12, 2012
See http://bankrupt.com/misc/pamb12-07097.pdf
represented by: John H. Doran, Esq.
DORAN & DORAN, P.C.
E-mail: jdoran@doran-law.net
In re Ston'art Inc.
Bankr. D.P.R. Case No. 12-09787
Chapter 11 Petition filed December 12, 2012
See http://bankrupt.com/misc/prb12-09787.pdf
represented by: Carlos Rodriguez Quesada, Esq.
LAW OFFICE OF CARLOS RODRIGUEZ QUESADA
E-mail: cerqlaw@coqui.net
In re Carnel S.E.
Bankr. D.P.R. Case No. 12-09780
Chapter 11 Petition filed December 12, 2012
In re David Morris
Bankr. D. Utah Case No. 12-35499
Chapter 11 Petition filed December 12, 2012
In re Keyvan Koochek
Bankr. D. Ariz. Case No. 12-26477
Chapter 11 Petition filed December 13, 2012
In re Alcides Araujo
Bankr. C.D. Calif. Case No. 12-37408
Chapter 11 Petition filed December 13, 2012
In re Rodilyn Almuete
Bankr. C.D. Calif. Case No. 12-50846
Chapter 11 Petition filed December 13, 2012
In re Gary Lennox
Bankr. D. Colo. Case No. 12-35152
Chapter 11 Petition filed December 13, 2012
In re Lolita, LLC
aka Lolita Cucina and Tequila Bar
Bankr. D. Conn. Case No. 12-52228
Chapter 11 Petition filed December 13, 2012
See http://bankrupt.com/misc/ctb12-52228p.pdf
See http://bankrupt.com/misc/ctb12-52228c.pdf
Filed pro se
In re Red Lulu, LLC
Bankr. D. Conn. Case No. 12-52229
Chapter 11 Petition filed December 13, 2012
See http://bankrupt.com/misc/ctb12-52229p.pdf
See http://bankrupt.com/misc/ctb12-52229c.pdf
Filed pro se
In re Howard Coleman
Bankr. N.D. Ill. Case No. 12-48826
Chapter 11 Petition filed December 13, 2012
In re N. L. Morton Buildings, Ltd.
Bankr. N.D. Ill. Case No. 12-48881
Chapter 11 Petition filed December 13, 2012
See http://bankrupt.com/misc/ilnb12-48881.pdf
represented by: David P. Lloyd, Esq.
David P. Lloyd, Ltd.
E-mail: courtdocs@davidlloydlaw.com
In re James Phyfe
Bankr. D. Mass. Case No. 12-19699
Chapter 11 Petition filed December 13, 2012
In re Rogelio Buenrostro
Bankr. D. Mass. Case No. 12-19671
Chapter 11 Petition filed December 13, 2012
In re Casterline LLC
aka Casterline I LLC
Bankr. E.D. Mich. Case No. 12-66972
Chapter 11 Petition filed December 13, 2012
See http://bankrupt.com/misc/mieb12-66972.pdf
represented by: Kurt Thornbladh, Esq.
Thornbladh Legal Group, PLLC
E-mail: kthornbladh@gmail.com
In re Quick Corner Inc.
dba Quick Corner Party Store
Bankr. E.D. Mich. Case No. 12-66999
Chapter 11 Petition filed December 13, 2012
See http://bankrupt.com/misc/mieb12-66999p.pdf
See http://bankrupt.com/misc/mieb12-66999c.pdf
represented by: Michael A. Greiner, Esq.
Financial Law Group, P.C.
E-mail: mike@financiallawgroup.com
In re Albert Baccili
Bankr. D.N.J. Case No. 12-39001
Chapter 11 Petition filed December 13, 2012
In re 614 Realty LLC
Bankr. E.D.N.Y. Case No. 12-48413
Chapter 11 Petition filed December 13, 2012
See http://bankrupt.com/misc/nyeb12-48413.pdf
represented by: David Carlebach, Esq.
Law Offices of David Carlebach
E-mail: david@carlebachlaw.com
In re 74-24 Jamaica Realty LLC
Bankr. E.D.N.Y. Case No. 12-48430
Chapter 11 Petition filed December 13, 2012
See http://bankrupt.com/misc/nyeb12-48430.pdf
represented by: Joseph Sanchez, Esq.
Law Office of Joseph Sanchez, P.C.
E-mail: law@josephsanchez.com
In re 94 Maple Avenue LLC
Bankr. E.D.N.Y. Case No. 12-48429
Chapter 11 Petition filed December 13, 2012
See http://bankrupt.com/misc/nyeb12-48429.pdf
represented by: Kevin J. Nash, Esq.
Goldberg Weprin Finkel Goldstein LLP
E-mail: KNash@gwfglaw.com
In re Braun Properties, LLC
Bankr. E.D. Tenn. Case No. 12-35013
Chapter 11 Petition filed December 13, 2012
See http://bankrupt.com/misc/tneb12-35013p.pdf
See http://bankrupt.com/misc/tneb12-35013c.pdf
represented by: Keith L. Edmiston, Esq.
Gribble Carpenter & Associates, PLLC
E-mail: kle@gribblecarpenter.com
In re Michael Willner
Bankr. E.D. Va. Case No. 12-17322
Chapter 11 Petition filed December 13, 2012
In re Collaspe Impossible Inc.
Bankr. W.D. Wash. Case No. 12-22338
Chapter 11 Petition filed December 13, 2012
See http://bankrupt.com/misc/wawb12-22338.pdf
represented by: Jason E. Anderson, Esq.
Law Office of Jason E Anderson
E-mail: jason@jasonandersonlaw.com
*********
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, Carmel
Paderog, Meriam Fernandez, Ronald C. Sy, Joel Anthony G. Lopez,
Cecil R. Villacampa, Sheryl Joy P. Olano, Ivy B. Magdadaro, Carlo
Fernandez, Christopher G. Patalinghug, and Peter A. Chapman,
Editors.
Copyright 2012. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $775 for 6 months delivered via
e-mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Christopher
Beard at 240/629-3300.
*** End of Transmission ***