/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/130603.mbx T R O U B L E D C O M P A N Y R E P O R T E R Monday, June 3, 2013, Vol. 17, No. 152 Headlines 17 PELHAM: Case Summary & 4 Largest Unsecured Creditors ABSORBENT TECHNOLOGIES: Committee Taps Green & Markley as Counsel ABSORBENT TECHNOLOGIES: Gary U. Scharff Approved as Counsel ABSORBENT TECHNOLOGIES: Proposes $1-Mil. Loan from Lenders ADAMS PRODUCE: Creditor Seeks to Alter Plan Confirmation Order ADVANCE IRON: Conduit Court Remands Suit v. VP to State Court AEOLUS PHARMACEUTICALS: Russell Skibsted to Quit as SVP & CFO AEMETIS INC: Amends Heiskell Purchasing Agreement AFA INVESTMENT: Asks for Plan Filing Exclusivity Until Oct. 2 AHERN RENTALS: Prices Upsized Private Offering of Sr. Sec. Notes ALLIANCE HEALTHCARE: S&P Lowers Rating on $470MM Facility to 'B+' ALLIED SYSTEMS: Creditors Look To Regulate Use of $15M D&O Policy ALLY FINANCIAL: Asks Court to Approve Plan Support Agreement AMERICAN AIRLINES: Fitch Rates $119.8MM Class C Certificates 'CCC' AMERICAN GREETINGS: Buyout Prompts Moody's to Lower CFR to 'B1' AMINCOR INC: Amends First Quarter Form 10-Q API TECHNOLOGIES: First Amendment to Credit Pact with Wells Fargo APOLLO MEDICAL: David Schmidt Named to Board of Directors ARRHYTHMIA RESEARCH: Gets NYSE MKT Listing Non-Compliance Notice AS SEEN ON TV: Assumes License Agreement with Chairman ATARI INC: PWP Retention Order Amended on Timekeeping ATLANTIC & PACIFIC: 2nd Cir. Upholds Assumption of Lease ATP OIL: Asset Sale Isn't 'Preordained', Warns Judge AVAYA INC: S&P Revises Outlook to Negative & Affirms 'B-' CCR BANKS OF WISCONSIN: FDIC Named as Receiver; NSB Assumes Deposits BEACON ENTERPRISE: Inks Pact to Acquire Optos Capital BEATS ELECTRONICS: S&P Assigns 'B+' CCR; Outlook Stable BIG M: Has Until Aug. 5 to Propose Plan of Reorganization BIG M: Porzio Bromberg Approved as Special Litigation Counsel BIG M: Time to Remove Civil Actions Extended to July 8 BIG M: Taps Porzio Bromberg as Insurance Litigation Counsel BISCAYNE PARK: "Excess Value" Suit v. Madison Stays in Dist. Ct. BLACK PRESS: Proposed $150MM Term Loan Gets Moody's 'B1' Rating BLUEJAY PROPERTIES: Has Access to Cash Collateral Until July BOMBARDIER RECREATIONAL: Moody's Retains B1 CFR Following IPO BON-TON STORES: Incurs $26.6 Million Net Loss in First Quarter BOSCH MOTORS: Case Summary & 6 Largest Unsecured Creditors CAESARS ENTERTAINMENT: Bank Debt Trades at 10.24% Discount CAI INTERNATIONAL: S&P Affirms 'BB' Corp. Credit Rating CAMCO FINANCIAL: Stockholders Elect Three Directors CANYON PORT: Jordan Hyden Directed to Provide Breakdown of Fees CBS I: Charles E. Jack Approved to Provide Appraisal Services CENTRAL EUROPEAN: Confirms Prepackaged Plan of Reorganization CENTRAL EUROPEAN: RTL Extends Exchange Offer for 3% Senior Notes CENTRAL FEDERAL: Stockholders Elect Three Directors CENTRAL FEDERAL: John Lawell Quits as CFBank SVP Operations CENTURY PLAZA: Has Access to Cash Collateral Until July CLAIRE'S STORES: Incurs $26.6 Million Net Loss in 1st Quarter CLEAR CHANNEL: Randall Mays Quits From Board CLEARWATER SEAFOODS: Proposed Term Loans Get Moody's 'B1' Ratings CODA HOLDINGS: White & Case Can't Rep Co. in Ch. 11 CODA HOLDINGS: June 3 Auction Scheduled for Note Holders COMMUNITY FIRST: Four Directors Elected to Board COMMUNITY WEST: Shareholders Elect Nine Directors COMMUNICATION INTELLIGENCE: Gets $1.5 Million Additional Funding CONTOURGLOBAL POWER: Moody's Withdraws 'B2' Ratings CORMEDIX INC: Obtains Extension of NYSE MKT Listing CUBIC ENERGY: Shareholders Elect Six Directors DALLAS ROADS: Case to be Converted if No Approved Plan by August DC DEVELOPMENT: Agrees With BB&T to Escrow Funds DIGERATI TECHNOLOGIES: Voluntary Chapter 11 Case Summary DTF CORP: June 25 Hearing on Adequacy of Plan Outline DUMA ENERGY: To Use New 3D Seismic to Locate Deeper Reserves DUVALL-WATSON: Court Dismisses Chapter 11 Case E-DEBIT GLOBAL: To Sell Ownership in Group Link to Screenfin EASTMAN KODAK: Judge Pushes Co., Ricoh to Set Patent Dispute Aside EASTMAN KODAK: GECC Seeks $1.35MM Claim Over Private Jet ELBIT IMAGING: Israeli Court Won't Convene Meeting of Creditors ELEPHANT TALK: Significant Losses Prompts Non-Compliance Notice EXPERA SPECIALTY: Moody's Assigns 'Caa1' Rating to $178MM Loan FEDERAL-MOGUL CORP: Moody's Keeps CFR over $500MM Rights Offering FIRST BALDWIN: Home Bancshares' Contribution Claim Rejected FOREST OIL: Weak Finances Prompt Moody's to Lower CFR to 'B2' FRIENDSHIP VILLAGE: Fitch Affirms 'BB-' Rating on Revenue Bonds GENERAL MOTORS: Rapp Chevrolet Barred From Using GM Trademark GLIMCHER REALTY: S&P Raises Corp. Credit Rating to 'BB-' GOODMAN NETWORKS: Moody's Cuts CFR to B3 Following Debt Increase GOODMAN NETWORKS: S&P Retains 'B' Notes Rating After $100MM Add-On GREGORY & PARKER: Two Banks' Bid to Dismiss Bankr. Cases Denied GREENBRIER NURSERIES: Case Summary & Creditors List GREENVILLE LAND: Voluntary Chapter 11 Case Summary GUNDER ROAD: Case Summary & 20 Largest Unsecured Creditors GYMBOREE CORP: Bank Debt Trades at 1.83 % Off in Secondary Market HARPER BRUSH: Case Converted to Chapter 7 HARRIS COUNTY HSA: Moody's Maintains Ba3, B2 & B3 3rd Lien Ratings HEALTH NET: Fitch Affirms 'BB+' Issuer Default Rating INTERNATIONAL HOME: June 10 Hearing on Approval of Plan Outline INTERNATIONAL HOME: June 10 Hearing on Bank's Bid to Convert Case JAZZ PHARMACEUTICALS: Debt Increase No Impact on Moody's Ba3 CFR JG WENTWORTH: S&P Revises Outlook to Negative & Affirms 'B' ICR KEELEY AND GRABANSKI: G&K Farms et al.'s Claims Disallowed KEELEY AND GRABANSKI: Can't Employ DeWayne Johnston as Counsel KGHM INTERNATIONAL: S&P Revises Ratings Outlook to Negative LICHTIN/WADE LLC: Case Converted for Lack of Plan Funding LIFE UNIFORM: Enters Into Asset Purchase Deal with Scrubs & Beyond LIFE UNIFORM: Case Summary & 30 Largest Unsecured Creditors LIFECARE HOLDINGS: Settlement for Unsecured Creditors Approved LINN ENERGY: S&P Retains 'B+' CCR on CreditWatch Positive LSP MADISON: Moody's Rates $450MM Sr. Secured Term Loan 'Ba3' MAIN STREET: Daily Voice Auction Set for June 20 MFM INDUSTRIES: Meeting to Form Creditors' Panel on June 6 MOBILE MINI: S&P Revises Outlook to Positive & Affirms 'BB-' CCR MTS LAND: Mediation This Week; Confirmation Hearing Moved to Aug. MUD KING: U.S. Trustee Unable to Appoint Creditors Committee MUD KING: Muskat Martinez Approved as Special Litigation Counsel MUNICIPAL CORRECTIONS: CohnReznick LLP Approved as Auditor MURR'S AUTO: Case Summary & 6 Largest Unsecured Creditors NATIONAL GOLD: Chancery Court Sides With Israel Discount Bank NATURAL PORK: Panel Can Hire Cutler Law Firm as Associate Counsel NATURAL PORK: Exclusive Plan Filing Extended Until Sept. 9 NEIMAN MARCUS: Bank Debt Trades at 0.08% Off in Secondary Market NORTH AMERICAN BREWERIES: Moody's Changes Rating Outlook to Neg NV ENERGY: Fitch 'BB+' Long-term IDR on Rating Watch Positive NV ENERGY: S&P Puts 'BB+' Sr. Unsec. Rating on CreditWatch Pos. ORMET CORP: Studying Details for Potential Chapter 11 Plan OSI RESTAURANT: Bank Debt Trades at 0.1% off in Secondary Market PARKVIEW, L.P.: Voluntary Chapter 11 Case Summary PICCADILLY RESTAURANTS: Seeks to Expand FTI Employment PLY GEM: S&P Raises Corporate Credit Rating to 'B'; Outlook Stable PRO'S RANCH: Files Voluntary Chapter 11 Bankruptcy Petition QUEBECOR MEDIA: Rogers Accord No Impact on Moody's Ba3 Rating REGAL ENTERTAINMENT: Fitch Rates $250MM Sr. Unsecured Notes 'B-' REVEL AC: S&P Withdraws All Ratings Following Bankruptcy Emergence REVOLUTION DAIRY: Panel Retains Berkeley as Financial Advisor REVOLUTION DAIRY: Seeks to Extend Plan Filing Deadline to June 24 RG STEEL: Hilco Warren Buys Steel Making Assets From BDM Warren RHODES COMPANIES: Dist. Court Won't Reinstate James Rhodes' Claims ROTHSTEIN ROSENFELDT: Plan Going to Creditors for Vote ROYAL CARIBBEAN: May 27 Fire Incident No Impact on Moody's Ratings RURAL/METRO CORP: High Leverage Cues Moody's to Cut CFR to Caa2 SAN DIEGO HOSPICE: Amends Schedules of Assets and Liabilities SANDISK CORP: S&P Revises Outlook to Positive & Affirms 'BB' CCR SCHOOL SPECIALTY: Seeks More Exclusivity Just in Case SELECT MEDICAL: Moody's Lifts Rating on Sr. Debt Facility to Ba2 SERVICE CORP: S&P Puts 'BB-' Sr. Unsec. Rating on CreditWatch Neg. SLM CORP: Moody's Clarifies Recent Ratings Action SMART & FINAL: S&P Revises Outlook to Stable & Affirms 'B' CCR SMITHFIELD FOODS: Moody's Reviews Ratings After Merger Pact SOUTHERN OAKS: June 25 Hearing on Adequacy of Plan Outline STAFFORD LOGISTICS: Moody's Rates New $130 Million Debt 'B3' STAMP FARMS: Files Plan of Liquidation With Committee's Support STAR BUFFET: Sells Real Estate Property to Repay Wells Fargo STEWART ENTERPRISES: S&P Puts 'BB-' Rating on CreditWatch Dev. SUNSTONE COMPONENTS: Files Schedules of Assets and Liabilities SUNSTONE COMPONENTS: Five-Member Creditors Committee Formed SUNSTONE COMPONENTS: Taps Landau Gottfried as Bankruptcy Counsel SUNSTONE COMPONENTS: Taps Three Twenty One as Investment Banker T-L BRYWOOD: Continued Hearing on Use of Cash Collateral Set Today TELECOMMUNICATIONS MGT: Cable Acquisition No Impact on Moody's CFR TRANSVANTAGE SOLUTIONS: U.S. Trustee to Appoint Ch. 11 Trustee TRIUMPH GROUP: S&P Revises Outlook to Stable & Affirms 'BB' CCR VEECO INSTRUMENTS: Gets NASDAQ Listing Non-Compliance Notice VIDEOTRON LTEE'S: Moody's Says Rogers Pact is Credit-Positive WAUPACA FOUNDRY: S&P Affirms 'B+' CCR Following $125MM Loan Add-On WESTERN ALLIANCE: Moody's Withdraws 'Ba3' Rating on Senior Debt XINERGY CORP: Moody's Withdraws 'Caa3' Ratings * Moody's Notes Near-Flat 10-Year Growth for US State Debt * 13 Defaults in First 4 Months of 2013, Says Fitch * Circuit Court Liberalizes Rules on Mutual Setoff * Lien on Rent Must Have Separate Adequate Protection * Three Circuits Retain Absolute Priority Rule for Individuals * BOND PRICING: For Week From May 27 to May 31, 2013 ********* 17 PELHAM: Case Summary & 4 Largest Unsecured Creditors ------------------------------------------------------- Debtor: 17 Pelham Lane Realty Trust 121 Philip Place Hawthorne, NY 10532 Bankruptcy Case No.: 13-22834 Chapter 11 Petition Date: May 29, 2013 Court: U.S. Bankruptcy Court Southern District of New York (White Plains) Judge: Robert D. Drain Debtor's Counsel: Francis J. O'Reilly, Esq. Francis J. O'Reilly, Esq. 10 McMahon Place Mahopac, NY 10541 Tel: (845) 621-1255 Fax: (845) 621-1686 E-mail: foreilly@bestweb.net Scheduled Assets: $1,200,000 Scheduled Liabilities: $2,110,000 The Company?s list of its four largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/nysb13-22834.pdf The petition was signed by Dario Tertan, trustee. ABSORBENT TECHNOLOGIES: Committee Taps Green & Markley as Counsel ----------------------------------------------------------------- The Official Committee of Unsecured Creditors in the Chapter 11 case of Absorbent Technologies asks the U.S. Bankruptcy Court for the District of Oregon for permission to retain Green & Markley, P.C. as its counsel effective as of April 23, 2013. The Committee initially selected Tonkon Torp LLP as its legal counsel. Due to a potential conflict, the firm withdrew as counsel. The Committee, with the unanimous approval of its members, has selected G&M as its attorneys to represent the Committee in all matters in this Chapter 11 case. The hourly rates of Green & Markley's personnel are: David A. Foraker, Principal $450 Conde T. Cox, Of Counsel $395 Sanford R. Landress, Principal $315 Corri Larsen, Legal Assistant $160 To the best of the Committee's knowledge, G&M does not represent an adverse interest in connection with the case. Absorbent Technologies Absorbent Technologies, Inc., sought Chapter 11 protection (Bankr. D. Ore. Case No. 13-31286) on March 8, 2013. David C. Moffenbeier signed the petition as CEO. Judge Trish M. Brown presides over the case. The Law Office of Gary U. Scharff serves as the Debtor's counsel. The Beaverton, Oregon-based company develops, produces, and markets starch-based superabsorbent products and ingredients in the United States and internationally. It offers Zeba, a corn starch-based polymer that helps farmers grow bigger crops with less water. Placed near a plant's roots, Zeba serves as a Grape Nut-sized sponge that holds and distributes water as a plant needs it. The Debtor estimated assets and debts of at least $10 million. The Debtor has a manufacturing facility at 140 Queen Avenue SW, Albany, Oregon. Fluffco LLC and Ephesians Equity Group LLC own equity interests in privately held Absorbent Technologies. The Debtor is seeking a buyer for its assets and property. The U.S. Trustee formed a four-member committee of unsecured creditors. Green & Markley, P.C. represents the Committee. ABSORBENT TECHNOLOGIES: Gary U. Scharff Approved as Counsel ----------------------------------------------------------- The U.S. Bankruptcy Court for the District of Oregon authorized Absorbent Technologies, Inc., to employ the Law Office of Gary U. Scharff as counsel. The hourly rates of the firm's personnel are: Gary Underwood Scharff, attorney $420 Heather A. Brann, attorney $280 Kellie Ann Furr, legal assistant $120 To the best of Debtor's knowledge, Messrs. Scharff and Brann represent no interest adverse to Debtor or to the estate in matters on which the law firm is to be engaged. Absorbent Technologies Absorbent Technologies, Inc., filed a Chapter 11 petition (Bankr. D. Ore. Case No. 13-31286) on March 8, 2013, without citing a reason. David C. Moffenbeier signed the petition as CEO. Judge Trish M. Brown presides over the case. The Law Office of Gary U. Scharff serves as the Debtor's counsel. The Beaverton, Oregon-based company develops, produces, and markets starch-based superabsorbent products and ingredients in the United States and internationally. It offers Zeba, a corn starch-based polymer that helps farmers grow bigger crops with less water. Placed near a plant's roots, Zeba serves as a Grape Nut-sized sponge that holds and distributes water as a plant needs it. The Debtor estimated assets and debts of at least $10 million. The Debtor has a manufacturing facility at 140 Queen Avenue SW, Albany, Oregon. Fluffco LLC and Ephesians Equity Group LLC own equity interests in privately held Absorbent Technologies. The Debtor is seeking a buyer for its assets and property. The U.S. Trustee formed a four-member committee of unsecured creditors. Green & Markley, P.C. represents the Committee. ABSORBENT TECHNOLOGIES: Proposes $1-Mil. Loan from Lenders ---------------------------------------------------------- Absorbent Technologies, Inc., asks the U.S. Bankruptcy Court for the District of Oregon for authorization to obtain postpetition loans of up to $1,000,000 jointly from Joseph A. Nathan living trust ua dtd 12/30/1996, Joseph A. Nathan trustee and United Phosphorus Inc., with each providing one half of the loan. The Debtor would use the loan to operate its business. The Debtor has been unable to obtain unsecured credit, except on the terms and conditions set forth in the DIP Agreement. The terms of the DIP financing are: (a) interest rate of 8% per annum on outstanding advances; (b) reimbursement of lenders' reasonable expenses associated with the credit facility, including attorney fees; (c) termination in the event of Debtor default; and (d) adequate protection consisting of the granting of (i) a first priority lien on all of the Debtor's intellectual property assets and all proceeds thereof, whether now existing or hereafter arising, and (ii) an allowed superpriority administrative expense claim pursuant to Section 364(c)(1) of the Bankruptcy Code. Absorbent Technologies Absorbent Technologies, Inc., filed a Chapter 11 petition (Bankr. D. Ore. Case No. 13-31286) on March 8, 2013, without citing a reason. David C. Moffenbeier signed the petition as CEO. Judge Trish M. Brown presides over the case. The Law Office of Gary U. Scharff serves as the Debtor's counsel. The Beaverton, Oregon-based company develops, produces, and markets starch-based superabsorbent products and ingredients in the United States and internationally. It offers Zeba, a corn starch-based polymer that helps farmers grow bigger crops with less water. Placed near a plant's roots, Zeba serves as a Grape Nut-sized sponge that holds and distributes water as a plant needs it. The Debtor estimated assets and debts of at least $10 million. The Debtor has a manufacturing facility at 140 Queen Avenue SW, Albany, Oregon. Fluffco LLC and Ephesians Equity Group LLC own equity interests in privately held Absorbent Technologies. ADAMS PRODUCE: Creditor Seeks to Alter Plan Confirmation Order -------------------------------------------------------------- Mary Anderson, a creditor of Adams Produce Company, et al., objects to the notice of occurrence of the effective date of the Debtors' second amended joint Chapter 11 plan of liquidation and asks the Court to alter, amend, or vacate the same to allow her to appeal the confirmation order. According to Mary Anderson, represented by Walter F. McArdle, Esq., at Spain & Gillon, LLC, in Birmingham, Alabama, on May 6, 2013, the Debtors filed the notice of occurrence of the effective date. The Notice provides that it is being entered pursuant to the terms and conditions of the Debtors' confirmed Plan. However, the Debtors' confirmed Plan provides that "the Effective Date is the first business day following the date on which the Confirmation Order becomes a final order." The order confirming the Debtors' Plan was entered on April 24, 2013. Pursuant to Rule 8002(a) of the Federal Rules of Bankruptcy Procedure, parties have 14 days after entry of the Confirmation Order to appeal. The deadline to appeal or file a post-trial motion expired at 12:00 Midnight on May 8, 2013. Mr. McArdle argues that the first business day after the order would become a final, non-appealable order would be May 9, 2013. Therefore, the Notice of Effective Date was filed prematurely. Mr. McArdle further argues that the Debtors should not be allowed to file a Notice of Effective Date of the Plan until the order confirming the Plan becomes a final, non-appealable order as provided for in the Plan. Ms. Anderson filed a claim asserting $250,076 for severance payment. Because Section 502(b)(7) of the Bankruptcy Code caps her claim, she amended her claim to reduce the amount to $130,076. Ms. Anderson believes that the balance of her claim arising from her employment with the Debtors, but excluded from her Section 502(b)(7) claim, is a claim that can only be discharged by the Debtors. The liability for that claim and the unpaid balance of the Section 502(b)(7) claim continues and can be recovered from third persons. However, Mr. McArdle notes that it appears the Debtors attempt to discharge the non-502(b)(7) portion of the claim, as to third persons and also enjoin Ms. Anderson from collecting that liability. The Debtor, according to Mr. McArdle, also seeks to limit Ms. Anderson's claim to the priority amount and leave her with no option to be paid any additional sums, even as a Class 3 General Unsecured Creditor. A hearing on Ms. Anderson's motions will be held on June 3, 2013, at 11:00 AM. About Adams Produce Adams Produce Company, LLC, filed a Chapter 11 petition (Bankr. N.D. Ala. Case No. 12-02036) on April 27, 2012, in its home-town in Birmingham, Alabama. Privately held Adams Produce was a distributor of fresh fruits and vegetables to restaurants, government and hospitality establishments across the Southeastern United States. Adams Produce disclosed $19,545,473 in assets and $41,569,039 and liabilities as of the Chapter 11 filing. A debtor-affiliate, Adams Clinton Business Park, LLC, estimated up to $10 million in assets and liabilities. The Debtors owe PNC Bank, National Association, $750,000 under a term loan, $1.35 million under a real estate loan, and $3.4 million under a revolver. The Debtors are also indebted $2 million under promissory notes. Adams owes $4.4 million in accounts payable to trade and other creditors, and $10.2 million to agricultural commodity suppliers. The Debtors tapped Burr & Forman as attorneys; CRG Partners Group LLC as financial advisor; and CRG's Thomas S. O'Donoghue, Jr. as chief restructuring officer; and Donlin Recano & Company Inc. as the claims and notice agent. Brian R. Walding, Esq., at Walding LLC, in Birmingham, Alabama, represents the Ad Hoc Committee of Non-Insider Employees as counsel. Adams Produce halted operations after filing for bankruptcy. It sold off the perishable inventory with court approval to former company managers for about half cost. ADVANCE IRON: Conduit Court Remands Suit v. VP to State Court ------------------------------------------------------------- The adversary complaint CONTEGRA CONSTRUCTION COMPANY, LLC, Plaintiff v. ROBERT V. SUTPHEN, Defendant, Adv. Proc. No. 13-03017 (Bankr. S.D. Ill), has been remanded to state court in a May 22, 2013, opinion by the Illionois bankruptcy court available at http://is.gd/fCo8Ztfrom Leagle.com. Robert V. Sutphen is the vice president for Advance Iron Works, Inc., who filed a Chapter 11 petition on Nov. 20, 2012. Before filing for bankruptcy, the Debtor and Contegra are parties to a steel fabrication contract for a construction project Contegra managed in Belleville, Illinois. However, a dispute arose among the parties involving contract violations. The dispute resulted to two lawsuits Contegra filed against the Debtor and a third suit against Mr. Sutphen. Of particular concern to the bankruptcy court is the third lawsuit, which was filed against Mr. Stuphen on Jan. 17, 2013, in the Circuit Court for the Third Judicial Circuit, Madison County, in Edwardsville, Illinois. On Feb. 15, 2013, the Debtor sought to remove the Madison County case to the Southern District of Illinois. A few days after, on Feb. 21, it sought to transfer the removed Madison County case from the Southern District of Illinois to the Northern District of Illinois bankruptcy court. In support of its removal request, the Debtor asserted that, although not a party to the Madison County lawsuit, it is the real party-in-interest. In a May 22 decision, Judge Laura K. Grandy of the U.S. Bankruptcy Court for the Southern District of Illinois said that the Debtor may not avail itself of the removal procedures since it is not a party to the Madison County case nor has it attempted to become one. Nor does Mr. Sutphen's consent to the Debtor's attempted removal cure the problems inherent in the Debtor's notice of removal, the judge noted. Against this backdrop, Judge Grandy concluded that the remedy is to remand the litigation to the Madison County court. Another issue raised is whether the Southern District of Illinois court -- as the conduit court -- should decide if Contegra is barred by the automatic stay of 11 U.S.C. Sec. 362 from pursuing the state court litigation against Mr. Sutphen. To this issue, Judge Grandy said, "Th[e Southern District of Illinois Bankruptcy] Court agrees with Contegra that it should not decide the question of whether the Madison County lawsuit is barred by the automatic stay protecting Advance. Since it is remanding the improperly removed action to the state court, this Court is not a proper forum for addressing this issue." Nothing in Judge Grandy's opinion and order, however, prevents the Debtor from directing this question to the home court in which the Debtor's chapter 11 case is pending. AEOLUS PHARMACEUTICALS: Russell Skibsted to Quit as SVP & CFO ------------------------------------------------------------- Russell Skibsted, senior vice president & chief financial officer of Aeolus Pharmaceuticals, Inc., provided notice that he is resigning from the Company, effective May 31, 2013. Concurrently with Mr. Skibsted's resignation, effective May 31, 2013, the Company appointed David Cavalier, an employee of the Company and the Chairperson of the Company's Board of Directors, to act as interim Chief Financial Officer of the Company and as the Company's interim principal financial and accounting officer. Mr. Cavalier, age 43, has been the Chairman of the Board since April 30, 2004, and became a full-time employee of the Company in November 2009. Since 2001, he has been a Principal and the Chief Operating Officer of Xmark Opportunity Partners, LLC, a manager of a family of private investment funds. From 1995 to 1996, Mr. Cavalier worked for Tiger Real Estate, a $785 million private investment fund sponsored by Tiger Management Corporation. Mr. Cavalier began his career in 1994 in the Investment Banking Division of Goldman, Sachs & Co., working on debt and equity offerings for public and private real estate companies. He received a B.A. from Yale University and an M.Phil. from Oxford University. A complete copy of the Form 8-K is available for free at: http://is.gd/FZikIC About Aeolus Pharmaceuticals Mission Viejo, California-based Aeolus Pharmaceuticals, Inc., is a Southern California-based biopharmaceutical company leveraging significant government investment to develop a platform of novel compounds in oncology and biodefense. The platform consists of over 200 compounds licensed from Duke University and National Jewish Health. The Company's lead compound, AEOL 10150, is being developed as a medical countermeasure ("MCM") against the pulmonary sub-syndrome of acute radiation syndrome ("Pulmonary Acute Radiation Syndrome" or "Lung-ARS") as well as the gastrointestinal sub-syndrome of acute radiation syndrome ("GI-ARS"). Both syndromes are caused by acute exposure to high levels of radiation due to a radiological or nuclear event. It is also being developed for use as a MCM for exposure to chemical vesicants such as chlorine gas, sulfur mustard gas and nerve agents. Grant Thornton LLP, in San Diego, Cal., expressed substantial dobut about Aeolus Pharmaceuticals' ability continue as a going concern. The independent auditors noted that the Company has incurred recurring losses and negative cash flows from operations, and management believes the Company does not currently possess sufficient working capital to fund its operations through fiscal 2013. The Company's balance sheet at March 31, 2013, showed $4.67 million in total assets, $3.06 million in total liabilities and $1.60 million in total stockholders' equity. AEMETIS INC: Amends Heiskell Purchasing Agreement ------------------------------------------------- Aemetis Advanced Fuels Keyes, Inc., a wholly-owned subsidiary of Aemetis, Inc., entered into an Amended and Restated Heiskell Purchasing Agreement dated May 16, 2013, with J.D. Heiskell Holdings, LLC, doing business as J.D. Heiskell & Co. Pursuant to the Purchasing Agreement, Heiskell will purchase and then resell the wet distiller's grains with solubles, concentrated distiller's solubles (a low fiber, high-protein product derived from the ethanol production process, also known as syrup), corn oil (a high fat liquid product derived from the ethanol production process), and denatured ethanol from AAFK's ethanol plant located near Keyes, California. The Purchasing Agreement will continue annually unless either party gives notice of termination as outlined in the agreement. On May 17, 2013, AAFK entered into an Amended and Restated Grain Procurement and Working Capital Agreement dated May 7, 2013, with Heiskell. Pursuant to the Grain Procurement Agreement, AAFK will purchase from Heiskell all of AAFK's requirements for whole yellow corn for the ethanol plant, and from time to time, Heiskell may also enter into sale contracts with AAFK for milo/grain sorghum. About Aemetis Cupertino, Calif.-based Aemetis, Inc., is an international renewable fuels and specialty chemical company focused on the production of advanced fuels and chemicals and the acquisition, development and commercialization of innovative technologies that replace traditional petroleum-based products and convert first- generation ethanol and biodiesel plants into advanced biorefineries. McGladrey LLP, in Des Moines, Iowa, expressed substantial doubt about Aemetis, Inc.'s ability to continue as a going concern following the annual results for the year ended Dec. 31, 2012. The independent auditors noted that the Company has suffered recurring losses from operations and its cash flows from operations are not sufficient to cover debt service requirements. The Company reported a net loss of $4.3 million on $189.0 million of revenues in 2012, compared with a net loss of $18.3 million on $141.9 million of revenues in 2011. The Company's balance sheet at March 31, 2013, showed $94.76 million in total assets, $98.14 million in total liabilities and a $3.37 million total stockholders' deficit. AFA INVESTMENT: Asks for Plan Filing Exclusivity Until Oct. 2 ------------------------------------------------------------- AFA Investment Inc., et al., ask the U.S. Bankruptcy Court for the District of Delaware to further extend their exclusive plan filing period through and including October 2, 2013, and their exclusive solicitation period through and including December 2, 2013, to allow them to continue to pursue a global settlement with key stakeholders, including the Official Committee of Unsecured Creditors, the Second Lien Agent, Nadia Sanchez, on behalf of herself and all others similarly situated, and American Capital, Ltd. According to the Debtors, the global settlement will bring the Chapter 11 cases to an efficient conclusion and maximize the value of the Debtors' estates for the benefit of their stakeholders. The Global Settlement also may provide a framework for the eventual development and confirmation of a Chapter 11 plan, the Debtors tell the Court. The Debtors say they are not seeking a fourth extension of the Exclusive Periods to exert undue pressure on any creditor. A hearing on the request will be on June 19, 2013, at 4:00 p.m. Objections are due June 7. Laura Davis Jones, Esq., Timothy P. Cairns, Esq., and Peter J. Keane, Esq., at Pachulski STANG Ziehl & Jones LLP, in Wilmington, Delaware; Tobias S. Keller, Esq., at Jones Day, in San Francisco; and Jeffrey B. Ellman, Esq., and Brett J. Berlin, Esq., at Jones Day, in Atlanta, Georgia, represent the Debtors. About AFA Foods King of Prussia, Pennsylvania-based AFA Foods Inc. was one of the largest processors of ground beef products in the United States. The Company had five processing facilities and two ancillary facilities across the country with annual processing capacity of 800 million pounds. AFA had seven facilities capable of producing 800 million pound of ground beef annually. Revenue in 2011 was $958 million. Yucaipa Cos. acquired the business in 2008 and currently owns 92% of the common stock and all of the preferred stock. AFA Foods, AFA Investment Inc. and other affiliates filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-11127) on April 2, 2012, after recent changes in the market for its ground beef products and the impact of negative media coverage related to boneless lean beef trimmings (BLBT) affected sales. Judge Mary Walrath presides over the case. Lawyers at Jones Day and Pachulski Stang Ziehl & Jones LLP serve as the Debtors' counsel. FTI Consulting Inc. serves as financial advisors and Imperial Capital LLC serves as marketing consultants. Kurtzman Carson Consultants LLC serves as noticing and claims agent. As of Feb. 29, 2012, on a consolidated basis, the Debtors' books and records reflected approximately $219 million in assets and $197 million in liabilities. AFA Foods, Inc., disclosed $615,859,574 in assets and $544,499,689 in liabilities as of the Petition Date. Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed seven members to the official committee of unsecured creditors in the Chapter 11 cases of AFA Investment Inc., AFA Foods and their debtor-affiliates. The Committee has obtained approval to hire McDonald Hopkins LLC as lead counsel and Potter Anderson & Corroon LLP serves as co-counsel. The Committee also obtained approval to retain J.H. Cohn LLP as its financial advisor, nunc pro tunc to April 13, 2012. AFA, in its Chapter 11 case, sold plants and paid off the first- lien lenders and the loan financing the Chapter 11 effort. Remaining assets are $14 million cash and the right to file lawsuits. General Electric Capital Corp. and Bank of America Corp. provided about $60 million in DIP financing. The loan was paid off in July. In October 2012, the Bankruptcy Court denied a settlement that would have released Yucaipa Cos., the owner and junior lender to AFA Foods, from claims and lawsuits the creditors might otherwise bring, in exchange for cash to pay unsecured creditors' claims under a liquidating Chapter 11 plan. Under the deal, Yucaipa would receive $11.2 million from the $14 million, with the remainder earmarked for unsecured creditors. Asset recoveries above $14 million would be split with Yucaipa receiving 90% and creditors 10%. Proceeds from lawsuits would be divided roughly 50-50. AHERN RENTALS: Prices Upsized Private Offering of Sr. Sec. Notes ---------------------------------------------------------------- Ahern Rentals, Inc. on May 31 disclosed that it has priced its offering of $420,000,000 aggregate principal amount of 9.50% Senior Secured Notes due 2018. The Notes will mature on June 15, 2018 unless earlier repurchased or redeemed in accordance with their terms. The company increased the size of the offering to $420,000,000 from $415,000,000. The company is conducting the offering in connection with its exit from Chapter 11 bankruptcy under a reorganization plan, which also contemplates that the company will enter into a new secured credit facility and that existing shareholders will make an equity contribution of $5 million to the company. The net proceeds from the offering will be placed in escrow until the company exits bankruptcy. The company intends to use the net proceeds from the offering, along with borrowings under the new credit facility and the equity contribution, to repay its existing debtor-in- possession loan and its existing term loan, and to redeem outstanding senior secured notes due 2013. Any remaining proceeds will be used for other general corporate purposes. The sale of the Notes is expected to be completed on June 7, 2013, subject to market and other customary conditions. The Notes are being offered and sold to qualified institutional buyers in the United States pursuant to Rule 144A and outside the United States pursuant to Regulation S under the Securities Act of 1933. The Notes have not been registered under the Securities Act of 1933 or any state securities laws and may not be offered or sold in the United States absent registration or an exemption from the registration requirements of the Securities Act of 1933 and applicable state laws. This press release does not constitute an offer to sell or a solicitation of an offer to buy the Notes or any other securities, and does not constitute an offer, solicitation or sale in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful. This press release is being issued pursuant to and in accordance with Rule 135c under the Securities Act of 1933. About Ahern Rentals Founded in 1953 with one location in Las Vegas, Nevada, Ahern Rentals Inc. -- http://www.ahern.com/-- offers rental equipment to customers through its 74 locations in Arizona, Arkansas, California, Colorado, Georgia, Kansas, Maryland, Nebraska, Nevada, New Jersey, New Mexico, North Carolina, North Dakota, Oklahoma, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Virginia and Washington. Privately held Ahern Rentals filed a voluntary Chapter 11 petition (Bankr. D. Nev. Case No. 11-53860) on Dec. 22, 2011, after failing to obtain an extension of the Aug. 21, 2011 maturity of its revolving credit facility. In its schedules, the Debtor disclosed $485.8 million in assets and $649.9 million in liabilities. Judge Bruce T. Beesley presides over the case. Lawyers at Gordon Silver and DLA Piper LLP (US) serve as the Debtor's counsel. The Debtor's financial advisors are Oppenheimer & Co. and The Seaport Group. Kurtzman Carson Consultants LLC serves as claims and notice agent. The Official Committee of Unsecured Creditors has tapped Covington & Burling LLP as counsel, Downey Brand LLP as local counsel, and FTI Consulting as financial advisor. Counsel to Bank of America, as the DIP Agent and First Lien Agent, are Albert M. Fenster, Esq., and Marc D. Rosenberg, Esq., at Kaye Scholer LLP, and Robert R. Kinas, Esq., at Snell & Wilmer. Attorneys for the Majority Term Lenders are Paul Aronzon, Esq., and Robert Jay Moore, Esq., at Milbank, Tweed, Hadley & McCloy LLP. Counsel for the Majority Second Lienholder are Paul V. Shalhoub, Esq., Joseph G. Minias, Esq., and Ana M. Alfonso, Esq., at Willkie Farr & Gallagher LLP. Attorney for GE Capital is James E. Van Horn, Esq., at McGuirewoods LLP. Wells Fargo Bank is represented by Andrew M. Kramer, Esq., at Otterbourg, Steindler, Houston & Rosen, P.C. Allan S. Brilliant, Esq., and Glenn E. Siegel, Esq., at Dechert LLP argue for certain revolving lenders. Attorneys for U.S. Bank National Association, as successor to Wells Fargo Bank, as collateral agent and trustee for the benefit of holders of the 9-1/4% Senior Secured Notes Due 2013 under the Indenture dated Aug. 18, 2005, is Kyle Mathews, Esq., at Sheppard, Mullin, Richter & Hampton LLP and Timothy Lukas, Esq., at Holland & Hart. In December 2012, the Court terminated Ahern's exclusive right to propose a plan, saying the company failed to negotiate in good faith after a year in Chapter 11. Certain holders of the Debtor's 9-1/4% senior secured second lien notes due 2013 proposed in February their own Plan to complete with Ahern's proposal. The Noteholder Group consists of Del Mar Master Fund Ltd.; Feingold O'Keeffe Capital, LLC; Nomura Corporate Research & Asset Management Inc.; Och-Ziff Capital Management Group; Sphere Capital, LLC - Series B; and Wazee Street Capital Management, LLC. They are represented by Laurel E. Davis, Esq., at Fennemore Craig Jones Vargas, Kurt A. Mayr, Esq., and Daniel S. Connolly, Esq., at Bracewell & Giuliani LLP. In March 2013, the Court approved disclosure materials explaining both plans. Ahern and the lenders both propose paying unsecured claims in full. The lenders' plan fully pays unsecured creditors when the plan is implemented. Plan confirmation hearing is set to begin in June. ALLIANCE HEALTHCARE: S&P Lowers Rating on $470MM Facility to 'B+' ----------------------------------------------------------------- Standard & Poor's Ratings Services said it lowered its rating on Alliance HealthCare Services' $470 million secured bank facility to 'B+' from 'BB-', and revised the recovery rating to '3', indicating prospects of meaningful recovery (50%-70%) of principal in the event of a default. The facility comprises a $340 million term loan and $80 million delayed draw loan, and $50 million revolving credit facility, which mature in 2019 and 2018, respectively. S&P also assigned its 'B+' rating to the $80 million delayed draw loan, with a '3' recovery rating. This financing, which S&P expects will take out the company's outstanding term loan and $80 million of unsecured debt, will be debt leverage neutral and will lower interest rates and extend maturities. The issue-level and recovery ratings are one notch below S&P's rating on the existing term loan as a result of the incremental $80 million of secured debt. S&P's ratings on Newport Beach, Calif.-based Alliance HealthCare Services reflects its "weak" business risk profile highlighted by a fragmented diagnostic imaging market with somewhat low barriers to entry, reimbursement risk, and a relatively high fixed-cost structure. Although operating performance remains under pressure, Alliance HealthCare's financial metrics have stabilized over the past few quarters. Adjusted debt leverage of 4.1x and funds from operations-to-debt of 17% for 2012 are consistent with the company's "aggressive" financial risk profile. Healthy internal cash generation support the company's "adequate" liquidity. RATINGS LIST Alliance HealthCare Services Corporate Credit Rating B+/Stable/-- Ratings Lowered/Recovery Ratings Revised To From Alliance HealthCare Services Senior Secured $340 mil term loan due 2019 B+ BB- Recovery Rating 3 2 $50 mil revolving facility due 2018 B+ BB- Recovery Rating 3 2 Rating Assigned Alliance HealthCare Services Senior Secured $80 million delayed draw loan B+ Recovery Rating 3 ALLIED SYSTEMS: Creditors Look To Regulate Use of $15M D&O Policy ----------------------------------------------------------------- Jamie Santo of BankruptcyLaw360 reported that unsecured creditors of private equity-owned Allied Systems Holdings Inc. asked a Delaware bankruptcy judge to restrict its board's ability to tap a $15 million directors and officers insurance policy to recoup legal expenses from a related suit, saying unlimited access would drain the car hauler's assets. According to the report, the committee of unsecured creditors -- which in February brought an adversary complaint against Yucaipa Cos. Ltd., the debtors' private equity owner, and certain Allied board members -- does not dispute that individual directors are covered under the policy, but wants the use of the policy limited. About Allied Systems BDCM Opportunity Fund II, LP, Spectrum Investment Partners LP, and Black Diamond CLO 2005-1 Adviser L.L.C., filed involuntary petitions for Allied Systems Holdings Inc. and Allied Systems Ltd. (Bankr. D. Del. Case Nos. 12-11564 and 12-11565) on May 17, 2012. The signatories of the involuntary petitions assert claims of at least $52.8 million for loan defaults by the two companies. Allied Systems, through its subsidiaries, provides logistics, distribution, and transportation services for the automotive industry in North America. Allied Holdings Inc. previously filed for chapter 11 protection (Bankr. N.D. Ga. Case Nos. 05-12515 through 05-12537) on July 31, 2005. Jeffrey W. Kelley, Esq., at Troutman Sanders, LLP, represented the Debtors in the 2005 case. Allied won confirmation of a reorganization plan and emerged from bankruptcy in May 2007 with $265 million in first-lien debt and $50 million in second- lien debt. The petitioning creditors said Allied has defaulted on payments of $57.4 million on the first lien debt and $9.6 million on the second. They hold $47.9 million, or about 20% of the first-lien debt, and about $5 million, or 17%, of the second-lien obligation. They are represented by Adam G. Landis, Esq., and Kerri K. Mumford, Esq., at Landis Rath & Cobb LLP; and Adam C. Harris, Esq., and Robert J. Ward, Esq., at Schulte Roth & Zabel LLP. Allied Systems Holdings Inc. formally put itself and 18 subsidiaries into bankruptcy reorganization June 10, 2012, following the filing of the involuntary Chapter 11 petition. The Company is being advised by the law firms of Troutman Sanders, Gowling Lafleur Henderson, and Richards Layton & Finger. The bankruptcy court process does not include captive insurance company Haul Insurance Limited or any of the Company's Mexican or Bermudan subsidiaries. The Company also announced that it intends to seek foreign recognition of its Chapter 11 cases in Canada. An official committee of unsecured creditors has been appointed in the case. The Committee consists of Pension Benefit Guaranty Corporation, Central States Pension Fund, Teamsters National Automobile Transporters Industry Negotiating Committee, and General Motors LLC. The Committee is represented by Sidley Austin LLP. Yucaipa Cos. has 55 percent of the senior debt and took the position it had the right to control actions the indenture trustee would take on behalf of debt holders. The state court ruled in March 2013 that the loan documents didn't allow Yucaipa to vote. In March, the bankruptcy court also gave the official creditors' committee authority to sue Yucaipa. The suit includes claims that the debt held by Yucaipa should be treated as equity or subordinated so everyone else is paid before the Los Angelesbased owner. The judge is allowing Black Diamond to participate in the lawsuit against Yucaipa and Allied directors. ALLY FINANCIAL: Asks Court to Approve Plan Support Agreement ------------------------------------------------------------ Residential Capital, LLC, and certain of its wholly owned direct and indirect subsidiaries asked the Bankruptcy Court to approve a plan support agreement pursuant to which the parties will support a Chapter 11 plan in the Debtors' Chapter 11 cases that will, among other things, settle and provide Ally Financial full releases for all existing and potential claims between Ally and the Debtors. Ally believes it has strong defenses against these claims and will vigorously defend its position, as necessary. Ally Financial, on behalf of itself and certain of its subsidiaries entered into the PSA with: -- the Debtors; -- the official committee of unsecured creditors appointed in the Debtors' Chapter 11 cases, and certain creditors, including AIG Asset Management (U.S.), LLC; -- Allstate Insurance Company; -- Financial Guaranty Insurance Company, which has executed the agreement pending regulatory approval; -- counsel to the putative class of persons represented in the consolidated class action entitled In re: Community Bank of Northern Virginia Second Mortgage Lending Practice Litigation, filed in the United States District Court for the Western District of Pennsylvania, MDL No. 1674, Case Nos. 03-0425, 02-01201, 05-0688, 05-1386; -- Massachusetts Mutual Life Insurance Company; -- MBIA Insurance Corporation; -- Paulson & Co. Inc., a holder of ResCap's senior unsecured notes issued by ResCap; -- Prudential Insurance Company of America; -- certain investors in residential mortgage-backed securities backed by mortgage loans held by securitization trusts associated with securitizations sponsored by the Debtors between 2004 and 2007 represented by Kathy Patrick of Gibbs & Bruns LLP and Keith H. Wofford of Ropes & Gray LLP; -- Talcott Franklin of Talcott Franklin, P.C., as counsel for certain RMBS investors; -- Wilmington Trust, National Association in its capacity as Indenture Trustee for ResCap's senior unsecured notes; and -- certain trustees or indenture trustee for certain mortgage backed securities trusts. The PSA, which incorporates a term sheet for the Plan, provides, among other things, that, on the effective date of the Plan, Ally will contribute to the Debtors' estates $1.95 billion in cash or cash equivalents, and will further contribute $150 million received by Ally for claims it pursues against its insurance carriers related to the claims released in connection with the Plan, with that amount guaranteed by Ally to be paid no later than Sept. 30, 2014, in exchange for the releases of Ally to be included in the Plan. The Ally Contribution and other assets of the Debtors' estates will be distributed to creditors under the Plan. In addition, the Plan provides for the full repayment of Ally's secured claims against the Debtors, including approximately $1.13 billion that is owed to Ally by certain of the Debtors under existing credit facilities. The Plan will include a settlement of insurance disputes between Ally and the Debtors under which the Debtors will relinquish in favor of Ally all of their rights to coverage under certain insurance policies. Further, the PSA requires that all litigation against Ally by the Debtors, the Creditors' Committee and the Consenting Claimants be stayed so long as the PSA has not been terminated. In connection with the PSA, and as a result of an expected increase to its reserve for litigation, Ally expects to record a charge of approximately $1.55 billion in the second quarter of 2013. The PSA requires, among other things, that the following milestones be satisfied: (i) Wilmington Trust must receive a direction to enter into the PSA from the holders of senior unsecured notes on or before May 31, 2013; (ii) the Bankruptcy Court must approve the PSA on or before July 3, 2013; (iii) the Plan and related disclosure statement must be filed with the Bankruptcy Court on or before July 3, 2013; (iv) the FGIC rehabilitation court must approve the PSA and a separate settlement agreement entered into among the Debtors, FGIC, trustees of residential mortgage-backed trusts and certain institutional investors on or before Aug. 19, 2013; (v) the Bankruptcy Court must approve the Disclosure Statement on or before Aug. 30, 2013; and (vi) the effective date of the Plan must occur on or before Dec. 15, 2013. In the event any of the milestones are not satisfied, the PSA could be terminated. On May 14, 2012, ResCap and certain of its wholly owned direct and indirect subsidiaries filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York. A copy of the Form 8-K as filed with the SEC is available at: http://is.gd/OV6qws About Ally Financial Ally Financial Inc., formerly GMAC Inc. -- http://www.ally.com/-- is one of the world's largest automotive financial services companies. The company offers a full suite of automotive financing products and services in key markets around the world. Ally's other business units include mortgage operations and commercial finance, and the company's subsidiary, Ally Bank, offers online retail banking products. Ally operates as a bank holding company. GMAC obtained a $17 billion bailout from the U.S. government in exchange for a 56.3% stake. Private equity firm Cerberus Capital Management LP keeps 14.9%, while General Motors Co. owns 6.7%. The Company's balance sheet at Dec. 31, 2012, showed $182.34 billion in total assets, $162.44 billion in total liabilities, and $19.89 billion in total equity. Ally Financial Inc. reported net income of $1.19 billion for the year ended Dec. 31, 2012, as compared with a net loss of $157 million during the prior year. * * * As reported by the TCR on Feb. 27, 2013, Moody's Investors Service confirmed the B1 corporate family and senior unsecured ratings of Ally Financial, Inc. and supported subsidiaries and assigned a positive rating outlook. In February 2012, Fitch Ratings downgraded the long-term Issuer Default Rating (IDR) and the senior unsecured debt rating of Ally Financial and its subsidiaries to 'BB-' from 'BB'. The Rating Outlook is Negative. The downgrade primarily reflects deteriorating operating trends in ResCap, which has continued to be a drag on Ally's consolidated credit profile, as well as exposure to contingent mortgage-related rep and warranty and litigation issues tied to ResCap, which could potentially impact Ally's capital and liquidity levels. In the Feb. 13, 2013, edition of the TCR, Fitch Ratings has maintained the Rating Watch Negative on Ally Financial Inc. including the Long-term IDR 'BB-'. As reported by the Troubled Company Reporter on May 22, 2012, Standard & Poor's Ratings Services revised its outlook on Ally Financial Inc. to positive from stable. At the same time, Standard & Poor's affirmed its ratings, including its 'B+' long- term counterparty credit and 'C' short-term ratings, on Ally. "The outlook revision reflects our view of potentially favorable implications for Ally's credit profile arising from measures the company announced May 14, 2012, designed to resolve issues relating to Residential Capital LLC, Ally's troubled mortgage subsidiary," said Standard & Poor's credit analyst Tom Connell. In the May 28, 2012 edition of the TCR, DBRS, Inc., has placed the ratings of Ally and certain related subsidiaries, including its Issuer and Long-Term Debt rating of BB (low), Under Review Developing. This rating action follows the decision by Ally's wholly owned mortgage subsidiary, Residential Capital to file a pre-packaged bankruptcy plan under Chapter 11 of the U.S. Bankruptcy Code. AMERICAN AIRLINES: Fitch Rates $119.8MM Class C Certificates 'CCC' ------------------------------------------------------------------ Fitch Ratings assigns the following rating to American Airlines Pass Through Trust Certificates, Series 2013-1: -- $119.8 million class C certificates (C-tranche) with an expected maturity of July 2018 'CCC'. Fitch has also placed the AA 2013-1 class C certificates on Rating Watch Positive reflecting Fitch's expectation that the tranche will likely be upgraded once American Airlines Inc. (AA; rated 'D') exits from Chapter 11 and completes its proposed merger with US Airways (LCC; rated 'B+', Outlook Positive). Fitch assigned a rating of 'BBB+' to the AA 2013-1 A-tranche and a rating of 'B' to the B-tranche in March of this year. For more information regarding the AA 2013-1 transaction please see Fitch's press release titled 'Fitch Rates American Airlines Inc.'s Proposed 2013-1 EETC Class A Certs 'BBB+' & Class B Certs 'B' dated March 5, 2013 at www.fitchratings.com. Key Rating Drivers The 'CCC' rating represents a four notch uplift from AA's current IDR of 'D'. Fitch typically assigns ratings on EETC C-tranches of 1 to 2 notches above the IDR of the underlying airline. However, in this case, Fitch believes that a higher number of notches is more appropriate given the inherent credit quality of the class C certificates based on both the strength of the underlying collateral, AA's better than expected operating profile during Chapter 11, and the fact that the aircraft have been affirmed. These factors are offset by the general uncertainty of the bankruptcy process and the absence of a liquidity facility. Transaction Overview The C-tranche will be sized at $119.8 million, and will feature a 5.1 year bullet maturity. It will constitute roughly 15% of the total debt raised in this transaction, which is roughly in line with most recent C-tranche issuances. The initial C-tranche loan to value (LTV) based on Fitch's aircraft values (provided by an independent third party appraiser) is 90.3%, which is comparable to the LCC 2012-1 and CAL 2012-3 C tranches that Fitch rated in 2012. The Base LTV is expected to rise slowly throughout the deal (due to the bullet maturity), reaching a max of 94.3%. As with subordinate tranches in most EETCs, the AA C-tranche will not feature a liquidity facility, and will be the first loss piece for this pool. As part of its reorganization plan, AA financed 13 aircraft through the 2013-1 EETC transaction, making it the first EETC issued while an airline is operating under Chapter 11 court supervision. Accordingly, the new equipment notes (and thereby the certificates) will qualify as 'post-petition' secured DIP financing as per the court-approved DIP order, and thereby grant creditors stronger downside protection while AA is still in Chapter 11. These stronger provisions are not incorporated in Fitch's ratings, as they 'fall-away' upon emergence when the contractual terms revert to standard EETC documentation, which forms the basis of Fitch's ratings analysis. The collateral package is comprised predominantly of Tier 1 (93% of collateral value) and Tier 2 aircraft, includes the following fleet types, all of which are core to AA's fleet, on a standalone basis, and Fitch expects also when combined with LCC. -- Four Tier 1 777-300ERs (2013 deliveries) representing 73% of initial collateral value; -- Eight Tier 1 737-800s (seven 2000 vintage; one 2001 vintage) representing 20% of initial collateral value; -- One Tier 2 777-200ER (2000 vintage) representing 7% of initial collateral value. Post-Petition Status: Under the proposed AA 2013-1 EETC transaction, AA will re-execute new equipment notes (in the form of mortgage) underlying the new certificates to be issued by a newly formed trust while AA is under court supervision. Consequently, the new equipment notes (and thereby the certificates) will qualify as 'post-petition' secured DIP financing as per the court-approved DIP order. Creditors in the AA 13-1 EETC will not only continue to hold a first priority claim to the pledged assets, but also continue to have their debt-service payments qualify as an 'administrative expense' similar to holders of the existing EETCs that have been affirmed and therefore, also been elevated to an administrative expense status. Standard EETC Structural Enhancements (Upon Emergence): Once AA emerges from Chapter 11 (expected later this year), Section 1110 and the standard features of the EETC template will govern the certificates. Similar to other recent EETCs, AA 2013-1 includes a dedicated liquidity facility provided by Natixis for both class A and B certificate holders that guarantees three consecutive interest payments over a period of 18 months in a potential default scenario. AA 2013-1 also includes the customary cross- collateralization and cross-default features that treat all aircraft as one pool of assets and limit AA's ability to cherry- pick assets within a EETC in a future bankruptcy. Rating Sensitivities: The Rating Watch Positive on the AA 2013-1 C-tranche reflects Fitch's expectations that the certificates will be upgraded upon American's emergence from Chapter 11 bankruptcy and completes its proposed merger with US Airways. Fitch has assigned the following ratings: American Airlines Pass Through Trusts 2013-1 -- Series 2013-1 class C certificates 'CCC'. AMERICAN GREETINGS: Buyout Prompts Moody's to Lower CFR to 'B1' --------------------------------------------------------------- Moody's Investors Service downgraded American Greetings Corp's Corporate Family Rating to B1 from Ba1 in connection with the management buyout by a group led by Chairman Morry Weiss, Chief Executive Officer Zev Weiss and Chief Operating Officer Jeffrey Weiss, in a deal valued at around $1 billion. At the same time, Moody's downgraded the $225 million of existing senior unsecured notes to B3 from Ba2. Moody's will rate the $600 million senior secured credit facility (consisting of a $200 million revolving credit facility and a $400 million term loan) prior to its launch. The rating of the unsecured notes reflects the new capital structure. These actions conclude a review for possible downgrade initiated on September 26, 2012. The outlook is stable. American Greetings will finance the deal with a combination of debt and equity ($240 million of new preferred equity and approximately $40 million of existing common equity), a $400 million term loan, $61 of cash and a $225 million rollover of existing debt). The preferred stock is held by Koch AG Investment, LLC, a subsidiary of Koch Industries Inc., and is treated as debt by Moody's for analytical purposes as it matures in 10 years and is puttable. This transaction raises American Greetings pro forma debt to EBITDA to just under 5 times from around 2.7 times as of February 28, 2013. If the preferred stock was treated as equity, pro forma debt to EBITDA would be around 4 times. "We do not expect the management buyout to affect American Greetings' modest growth potential, which will mostly come from its acquisitions of Clinton Cards, Recycled Paper Greetings, Papyrus and Watermark Publishing, as it battles to offset competitive pressures," said Kevin Cassidy, Senior Credit Officer, at Moody's Investors Service. "We think debt to EBITDA will remain above 4 times for at least the next couple of years," he noted. The following ratings were downgraded: Corporate Family Rating to B1 from Ba1; Probability of Default Rating to B1-PD from Ba1-PD; $225 Million Sr Unsecured Notes Rating to B3 (LGD 5, 81%) from Ba2 (LGD 5, 75%); $400 Million Secured Revolving Credit Facility Rating to Ba2 (LGD 2, 21%) from Baa3 (LGD 2, 21%) rating will be withdrawn when the new $600 million credit facility closes; Sr. Unsecured Shelf Rating to (P) B3 from (P) Ba2; The following rating was affirmed: Speculative grade liquidity rating at SGL 2 Ratings Rationale: American Greetings' B1 Corporate Family Rating reflects the business risks inherent in the greeting card industry, which is characterized by low or in some cases declining growth rates, its modest size with revenue around $1.9 billion, integration of its June 2012 acquisition of Clinton Cards, weak consumer branding and heavy competition. The ratings are supported by the company's position in the U.S. greeting card industry as one of the two leading companies, its long operating history of over 100 years, predictable demand for its products, and important relationships with retail customers. A key element to American Greetings' rating is its efficient cost structure and recent strategic acquisitions and disposition of its US retail operations. These positive factors are offset by the management buyout and resulting increase in leverage to just under 5 times from 2.7 times. Moody's believes stronger credit metrics are necessary to balance the mature nature of American Greetings' business. The stable outlook reflects Moody's belief that American Greetings' operating performance will modestly increase in fiscal 2014 as a result of a full year of operations of Clinton Cards, but then remain at or close to the new levels thereafter. Debt to EBITDA approaching 4.5 times by the end of Fiscal 2014 is reflected in the outlook. The rating could be upgraded if the integration of Clinton Cards continues to go well, revenue increases on a sustained basis and credit metrics improve from current levels. Specifically, debt to EBITDA would need to be sustained below 4 times and retained cash flow/net debt should approach 20% (pro forma 14%). The rating could be downgraded if operating performance weakens considerably or if the company increases leverage to fund shareholder returns or acquisitions such that debt to EBITDA is sustained above 5 times or retained cash flow/net debt falls below 10% for a prolonged period. The principal methodology used in rating American Greetings was Moody's Global Packaged Goods Industry methodology published in December 2012. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. American Greetings Corporation is a leading developer, manufacturer and distributor of greeting cards and social expression products. Sales were approximately $1.9 billion for the year ended February 28, 2013. AMINCOR INC: Amends First Quarter Form 10-Q ------------------------------------------- Amincor, Inc., has amended its quarterly report on Form 10-Q for the quarterly period ended March 31, 2013, filed with the Securities and Exchange Commission on May 17, 2013, solely to furnish Exhibit 101 to the Form 10-Q. Exhibit 101 provides the financial statements and related notes from the Form 10-Q formatted in XBRL (Extensible Business Reporting Language). No other changes have been made to the Form 10-Q. A copy of the Amended Form 10-Q is available at http://is.gd/2j2BFp About Amincor Inc. New York, N.Y.-based Amincor, Inc., is a holding company operating through its operating subsidiaries Baker's Pride, Inc., Environmental Holdings Corp. and Tyree Holdings Corp., and Amincor Other Assets, Inc. BPI is a producer of bakery goods. Tyree performs maintenance, repair and construction services to customers with underground petroleum storage tanks and petroleum product dispensing equipment. Through its wholly owned subsidiaries, Environmental Quality Services, Inc., and Advanced Waste & Water Technology, Inc., EHC provides environmental and hazardous waste testing and water remediation services in the Northeastern United States. Other Assets, Inc., was incorporated to hold real estate, equipment and loan receivables. As of March 31, 2013, all of Other Assets' real estate and equipment are classified as held for sale. The Company's balance sheet at March 31, 2013, showed $34.9 million in total assets, $35.4 million in total liabilities, and a stockholders' deficit of $512,584. As reported in the TCR on April 24, 2013, Rosen Seymour Shapss Martin & Company, in New York, expressed substantial doubt about Amincor's ability to continue as a going concern, citing the Company's recurring net losses from operations and working capital deficit of $21.2 million as of Dec. 31, 2012. API TECHNOLOGIES: First Amendment to Credit Pact with Wells Fargo ----------------------------------------------------------------- API Technologies Corp. entered into a First Amendment to the Credit Agreement, by and among the Company and certain of its subsidiaries, as borrowers, the lenders from time to time party thereto and Wells Fargo Bank, National Association, as administrative agent. The Amendment amends the certain Credit Agreement, dated as of Feb. 6, 2013, by and among the Borrowers, the lenders from time to time party thereto, the Agent and Wells Fargo Bank, National Association, as English law security trustee. The Amendment amends certain cash management and reporting requirements. A copy of the Amended Credit Agreement is available at: http://is.gd/QBkRn9 About API Technologies Corp. API Technologies designs, develops and manufactures electronic systems, subsystems, RF and secure solutions for technically demanding defense, aerospace and commercial applications. API Technologies' customers include many leading Fortune 500 companies. API Technologies trades on the NASDAQ under the symbol ATNY. For further information, please visit the Company Web site at www.apitech.com. For the 12 months ended Nov. 30, 2012, the Company reported a net loss of $148.70 million, as compared with a net loss of $17.32 million during the prior year. The Company's balance sheet at Feb. 28, 2013, showed $ 381.70 million in total assets, $232.94 million in total liabilities, $25.23 million in preferred stock, and $123.52 million in shareholders' equity. * * * As reported by the TCR on Feb. 14, 2013, Moody's Investors Service has withdrawn all ratings of API Technologies Corp., including its Caa1 Corporate Family Rating and negative outlook due to the repayment of all rated debt. On Feb. 6, 2013, API Technologies Corp. completed a refinancing of its previously outstanding rated bank debt. All ratings of API have been withdrawn since the company has no rated debt outstanding. In the Feb. 22, 2013, edition of the TCR, Standard & Poor's Ratings Services said that it lowered its corporate credit rating on API Technologies Corp. to 'B-' from 'B'. "The downgrade reflects weaker-than-expected credit metrics resulting from less-than-expected improvements in operating performance and higher debt, including a modest increase from the recent refinancing," said Standard & Poor's credit analyst Chris Mooney. APOLLO MEDICAL: David Schmidt Named to Board of Directors --------------------------------------------------------- Apollo Medical Holdings, Inc., has appointed David G. Schmidt as an independent member of its Board of Directors. Mr. Schmidt is currently a Principal of Schmidt & Associates, a consultancy practice that focuses on strategic planning and implementation in the healthcare industry. From 2002 to 2010, he served as the CEO and Member of the Board of SCAN Health Plan, the tenth largest Medicare Advantage plan in the country. With revenues exceeding $1.8 billion, the Company served more than 130,000 Medicare beneficiaries, including a large number of individuals receiving both Medicare and Medicaid. Prior to joining SCAN, Mr. Schmidt served as CEO of Medicheck, a firm that provided Internet-based financial service management to healthcare organizations. He led the Company from development stage through its sale to a healthcare IT company, Passport Health Communications. He then served on Passport's Board for four years. Prior to Medicheck, Mr. Schmidt was the Senior Vice President of Sales and Customer Services for Care America/Blue Shield Health Plan and Regional Vice President for FHP Healthcare. He received a BA in Economics from UCLA and an MBA from The Anderson School of Management at UCLA. "We are honored to have David join our Board of Directors," stated Warren Hosseinion, MD, chief executive officer of ApolloMed. "His wealth of industry experience in working with the specialized needs of high growth healthcare companies should prove invaluable to us as we persist in executing strategies to nationally distinguish ApolloMed as a noted leader in integrated healthcare delivery." "I am very pleased to be joining the ApolloMed team, as I believe their physician-driven, patient-centric approach to healthcare delivery will prove to be part of the solution to our country's healthcare crisis," added Schmidt. Mr. Schmidt entered into the Company's form of Director Agreement, which entitles him to receive a fee of $1,000 per Board meeting attended, as well as a grant of 400,000 restricted shares of the Company's common stock for his Board service. These restricted shares will vest evenly on a monthly basis over a 3-year period. About Apollo Medical Glendale, Calif.-based Apollo Medical Holdings, Inc., provides hospitalist services in the Greater Los Angeles, California area. Hospitalist medicine is organized around the admission and care of patients in an inpatient facility such as a hospital or skilled nursing facility and is focused on providing, managing and coordinating the care of hospitalized patients. Kabani & Company, Inc., in Los Angeles, California, issued a "going concern qualification on the consolidated financial statements for the fiscal year ended Jan. 31, 2013. The independent auditors noted that the Company had a loss from operations of $2,078,487 for the year ended Jan. 31, 2013, and had an accumulated deficit of $11,022,272 as of Jan. 31, 2013. These factors raise substantial doubt about the Company's ability to continue as a going concern. Apollo Medical reported a net loss of $8.90 million on $7.77 million of net revenues for the year ended Jan. 31, 2013, as compared with a net loss of $720,346 on $5.11 million of net revenues for the year ended Jan. 31, 2012. The Company's balance sheet at Jan. 31, 2013, showed $3.22 million in total assets, $3.61 million in total liabilities and a $391,379 total stockholders' deficit. ARRHYTHMIA RESEARCH: Gets NYSE MKT Listing Non-Compliance Notice ---------------------------------------------------------------- Arrhythmia Research Technology, Inc. on May 31 disclosed that, on May 17, 2013, it received notice from the NYSE MKT LLC that it is not in compliance with certain of the Exchange's continued listing standards as set forth in Sections 134 and 1101 of the Exchange's Company Guide as a result of the failure to file its interim report on Form 10-Q on a timely basis. The Company has therefore become subject to the procedures and requirements of Section 1009 of the Company Guide. Such procedures require the Company to communicate with the Exchange by May 23, 2013 to confirm receipt of the letter and indicate whether or not it intends to submit a plan of compliance. The Company intends to submit a plan of compliance to the Exchange by May 31, 2013 in accordance with the notice advising the Exchange of action it has taken or intends to take that will bring the Company into compliance with Sections 134 and 1101 of the Company Guide by no later than August 15, 2013. If the plan is accepted but the Company is not in compliance with the continued listing standards of the Company Guide by July 16, 2013 or if the Company is not making progress consistent with the plan, the Company may be subject to delisting procedures. About Arrhythmia Research Technology, Inc. Arrhythmia Research Technology, Inc. (NYSE MKT:HRT) -- http://www.arthrt.com--through its wholly-owned subsidiary, Micron Products, Inc. -- http://www.micronproducts.com-- has diversified manufacturing capabilities with the capacity to participate in full product life cycle activities from early stage development and engineering from prototyping to full scale manufacturing as well as packaging and product fulfillment services. Its subsidiary, Micron Products, Inc., also manufactures silver plated and non-silver plated conductive resin sensors and distributes metal snaps used in the manufacture of disposable ECG, EEG, EMS and TENS electrodes. The Company also has developed and distributes a customizable proprietary signal- averaging electrocardiography (SAECG) software used to diagnose the risk of certain heart arrhythmias and that is reconfigurable for a variety of hardware platforms. AS SEEN ON TV: Assumes License Agreement with Chairman ------------------------------------------------------ TVGoods, Inc., entered into an Assignment and Assumption Agreement with As Seen on TV, Inc., under which it transferred and assigned to the Company all of its rights, obligations, interests and liabilities under the License Agreement dated Feb. 8, 2012, between TVG and Kevin Harrington, the chairman of the Company's board of directors. TVGoods is a wholly owned subsidiary of As Seen on TV. Second Amendment to License Agreement Also on May 21, 2013, the Company and Mr. Harrington entered into the Second Amendment to the License Agreement, pursuant to which (1) the First Amendment to the License Agreement dated March 8, 2013, was deleted in its entirety, (2) Mr. Harrington retained, as owner, and the Company acquired, as licensee, exclusive rights to Mr. Harrington's name, likeness and other intellectual property rights and (3) Mr. Harrington's obligation to pay the Company 50 percent of certain speaking fees was deleted. Second Amendment to Services Agreement Also on May 21, 2013, the Company and Mr. Harrington entered into the Second Amendment to the Services Agreement dated Oct. 28, 2011, between the Company and Mr. Harrington, pursuant to which (1) Sections 2 and 6 of the First Amendment to the Services Agreement dated March 8, 2013, were deleted in their entirety and (2) Section 2 of the Services Agreement was amended to define Mr. Harrington's general duties and to clarify his rights and obligations with respect to speaking engagements, corporate opportunities and product endorsements. About As Seen on TV Clearwater, Fla.-based As Seen On TV, Inc., is a direct response marketing company. It identifies, develops, and markets consumer products. The Company reported a net loss of $8.07 million for the year ended March 31, 2012, compared with a net loss of $6.97 million during the prior fiscal year. The Company's balance sheet at Sept. 30, 2012, showed $9.74 million in total assets, $23.42 million in total liabilities and a $13.68 million total stockholders' deficiency. As reported by the TCR on Nov. 6, 2012, As Seen On TV entered into an Agreement and Plan of Merger with eDiets Acquisition Company ("Merger Sub"), eDiets.com, Inc., and certain other individuals. Pursuant to the Merger Agreement, Merger Sub will merge with and into eDiets.com, and eDiets.com will continue as the surviving corporation and a wholly-owned subsidiary of the Company. ATARI INC: PWP Retention Order Amended on Timekeeping ----------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York amended the order authorizing the employment and retention of Perella Weinberg Partners LP as investment banker to Atari, Inc., et al. The amendment addressed the request of the U.S. Trustee that the PWP retention order be amended to clarify the timekeeping requirements for Perella. In this relation, the amendment provides that, among other things: 1. Perella and its professionals (i) will report time in half hour increments along with reasonably detailed time records and (ii) will not be required to maintain or provide detailed time records in connection with its fee applications. 2. The PWP retention order as modified by this order will otherwise remain in full force and effect. 3. The Court retains jurisdiction with respect to all matters arising from or related to the implementation of the order. About Atari Atari -- http://www.atari.com-- is a multi-platform, global interactive entertainment and licensing company. Atari owns and/or manages a portfolio of more than 200 games and franchises, including world renowned brands like Asteroids(R), Centipede(R), Missile Command(R), Pong(R), Test Drive(R), Backyard Sports(R), and Rollercoaster Tycoon(R). Atari Inc. and its U.S. affiliates filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Lead Case No. 13-10176) on Jan. 21, 2013, to break away from their unprofitable French parent company and secure independent capital. A day after its American unit filed for Chapter 11 bankruptcy protection, Paris-based Atari S.A. took a similar measure under Book 6 of that country's commercial code. Atari S.A. said it was filing for legal protection because its longtime backer BlueBay has sought to sell its 29% stake and demanded repayment by March 31 on a credit line of $28 million that it cut off in December. Peter S. Partee, Sr. and Michael P. Richman of Hunton & Williams LLP are proposed to serve as lead counsel for the U.S. companies in their Chapter 11 cases. BMC Group is the claims and notice agent. Protiviti Inc. is the financial advisor. The Official Committee of Unsecured Creditors is seeking Court permission to retain Duff & Phelps Securities LLC as its financial advisor. The Committee sought and obtained authority to retain Cooley LLP as its counsel. ATLANTIC & PACIFIC: 2nd Cir. Upholds Assumption of Lease -------------------------------------------------------- Gator Monument Partners, LLLP, Gator Garwood Partners, Ltd., and Gator South Avenue Partners, Ltd., appeal from the affirmance of a bankruptcy court order allowing lessee Great Atlantic & Pacific Tea Company, operating under the trade name Pathmark, to assume an unexpired supermarket lease during a Chapter 11 reorganization. Gator had contested that assumption based on Pathmark's purported prepetition breach of the lease by failing to obtain Gator's consent to the sublease of a storefront on the leased premises to Dunkin' Donuts. Gator submits that the bankruptcy and district courts erred in construing the lease at issue not to require its consent to such a sublease. A three-judge panel of the U.S. Court of Appeals for the Second Circuit, however, affirmed the lower court judgment in a May 29, 2013 decision available at http://is.gd/ibXxbVfrom Leagle.com. The appellate case is, GATOR MONUMENT PARTNERS, LLLP, GATOR GARWOOD PARTNERS, LTD., GATOR SOUTH AVENUE PARTNERS, LTD., Appellants, v. THE GREAT ATLANTIC & PACIFIC TEA COMPANY, INC., ET AL., Appellees, No. 12-3466-bk (2nd Cir.). The panel consists of Circuit Judges Chester J. Straub, Reena Raggi, and Christopher F. Droney. David M. Kohane, Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., in Hackensack, New Jersey; Neal W. Cohen, Esq., at Halperin Battaglia Raicht, LLP, in New York; and Matthew C. Blickensderfer, Esq., at Frost Brown Todd LLC, in Cincinnati, Ohio, represent Gator et al. Andrew M. Genser, Esq., and Paul M. Basta, Esq., at Kirkland & Ellis LLP, represent A&P. About Great Atlantic & Pacific Founded in 1859, Montvale, New Jersey-based Great Atlantic & Pacific is a supermarket retailer, operating under a variety of well-known trade names, or "banners" across the mid-Atlantic and Northeastern United States. A&P and its affiliates filed Chapter 11 petitions (Bankr. S.D.N.Y. Case No. 10-24549) on Dec. 12, 2010, in White Plains, New York. Before filing for bankruptcy in 2010, A&P operated 429 stores in eight states and the District of Columbia under the following trade names: A&P, Waldbaum's, Pathmark, Pathmark Sav-a-Center, Best Cellars, The Food Emporium, Super Foodmart, Super Fresh and Food Basics. A&P had 41,000 employees prior to the bankruptcy filing. In its petition, A&P reported total assets of $2.5 billion and liabilities of $3.2 billion as of Sept. 11, 2010. Paul M. Basta, Esq., James H.M. Sprayregen, Esq., and Ray C. Schrock, Esq., at Kirkland & Ellis, LLP, in New York, and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, served as counsel to the Debtors. Kurtzman Carson Consultants LLC acted as the claims and notice agent. Lazard Freres & Co. LLC served as the financial advisor. Huron Consulting Group served as management consultant. Dennis F. Dunne, Esq., Matthew S. Barr, Esq., and Abhilash M. Raval, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represented the Official Committee of Unsecured Creditors. The Bankruptcy Court entered an order Feb. 27, 2012, confirming a First Amended Joint Plan of Reorganization filed Feb. 17, 2012. A&P consummated its financial restructuring and emerged from Chapter 11 as a privately held company in March 2012. A&P sold or closed stores during the bankruptcy proceedings. It emerged from bankruptcy with 320 supermarkets. Among others, A&P sold 12 Super-Fresh stores in the Baltimore-Washington area for $37.83 million, plus the value of inventory. Thirteen other locations didn't attract buyers at auction and were closed mid- July 2011. Mount Kellett Capital Management LP, The Yucaipa Companies LLC and investment funds managed by Goldman Sachs Asset Management, L.P., provided $490 million in debt and equity financing to sponsor A&P's reorganization plan and complete its balance sheet restructuring. JP Morgan and Credit Suisse arranged a $645 million exit financing facility. ATP OIL: Asset Sale Isn't 'Preordained', Warns Judge ---------------------------------------------------- Jacqueline Palank writing for Dow Jones' DBR Small Cap report that a bankruptcy judge on May 23 warned ATP Oil & Gas Corp. that it's not "preordained" that he'll approve the asset sale the company has long been pinning its hopes on but which has run into complications. The remarks, from Judge Marvin Isgur of the U.S. Bankruptcy Court in Houston, came at a status conference on ATP's progress in resolving concerns about its planned sale to its lenders, according to the report. The report relates that the lenders, led by Credit Suisse , have offered about $690 million for ATP's deepwater drilling assets, but much of the offer is in the form of debt forgiveness instead of cash. 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. Munsch Hardt Kopf & Harr, P.C., is the conflicts counsel. Motley Rice LLC and Fayard & Honeycutt, APC serve as special counsel. Opportune LLP is the financial advisor and Jefferies & Company is the investment banker. Kurtzman Carson Consultants LLC is the claims and notice agent. 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. 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. A 7-member panel of equity security holders has also been appointed in the case. Kyung S. Lee, Esq., and Charles M. Rubio, Esq. of Diamond McCarthy LLP, in Houston, Texas, serve as counsel to the Equity Committee. AVAYA INC: S&P Revises Outlook to Negative & Affirms 'B-' CCR ------------------------------------------------------------- Standard & Poor's Ratings Services revised its rating outlook on Avaya Inc. to negative from stable. At the same time, S&P affirmed its 'B-' corporate credit rating and other ratings on the company. The recovery ratings are unchanged. "The outlook revision is based on the company's negative operating trends, high leverage, and persistent negative free cash flow, with leverage of about 10x and challenges to restore revenue growth,' said Standard & Poor's credit analyst John Moore. The ratings on Avaya reflect its business risk profile, which we now characterize as "vulnerable," a revision from "weak," based on intense competition and the company's challenges to reestablish revenue growth in enterprise communications markets. S&P notes that Avaya's revenue declines were much sharper in the March quarter than those of its primary competitor, Cisco, whose enterprise telephony business declined by 1% year-over-year in the quarter. The ratings also reflect Avaya's "highly leveraged" financial risk profile; leverage remains very high, at about 10x for the 12 months ended March 31, 2013, including underfunded pension adjustments, operating lease adjustments, and recurring restructuring costs. S&P views Avaya's management and governance as "fair". The rating outlook is negative. S&P expects that over the coming year the company will find it difficult to restore revenue growth and revive a path toward free cash flow. S&P could lower the ratings if continued deterioration in operating trends, caused EBITDA generation to decline, free cash flow to remain negative or weak, or cash balances to erode below $200 million. Conversely, S&P could revise the outlook to stable if the company can reverse negative operating trends, including revenue declines and negative free cash flow, on a consistent basis, and preserve current levels of liquidity. BANKS OF WISCONSIN: FDIC Named as Receiver; NSB Assumes Deposits ---------------------------------------------------------------- Banks of Wisconsin, Kenosha, Wisconsin, was closed by the Wisconsin Department of Financial Institutions, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with North Shore Bank, FSB, Brookfield, Wisconsin, to assume all of the deposits of Banks of Wisconsin. The two branches of Banks of Wisconsin, which did business as Bank of Kenosha, will reopen as branches of North Shore Bank, FSB, during their normal business hours. Depositors of Banks of Wisconsin will automatically become depositors of North Shore Bank, FSB. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage up to applicable limits. Customers of Banks of Wisconsin should continue to use their existing branch until they receive notice from North Shore Bank, FSB that it has completed systems changes to allow other North Shore Bank, FSB branches to process their accounts as well. Friday evening and over the weekend, depositors of Banks of Wisconsin may access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual. As of March 31, 2012, Banks of Wisconsin had approximately $134.0 million in total assets and $127.6 million in total deposits. In addition to assuming all of the deposits of the failed bank, North Shore Bank, FSB agreed to purchase approximately $97.4 million of the failed bank's assets. The FDIC will retain the remaining assets for later disposition. The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $26.3 million. Compared to other alternatives, North Shore Bank, FSB's acquisition was the least costly resolution for the FDIC's DIF. Banks of Wisconsin is the 14th FDIC-insured institution to fail in the nation this year, and the first in Wisconsin. The last FDIC-insured institution closed in the state was Legacy Bank, Milwaukee, on March 11, 2011. BEACON ENTERPRISE: Inks Pact to Acquire Optos Capital ----------------------------------------------------- Beacon Enterprise Solutions Group, Inc., has executed a definitive agreement for the acquisition of Optos Capital Partners, LLC. Optos, which conducts business through its subsidiaries Focus Fiber Solutions and Focus Wireless, is a leading provider of infrastructure services for wired and wireless telecommunication companies. Optos is keenly focused on the expanding bandwidth needed to meet the robust demand for fast and reliable access to wired and 4G wireless data networks. Upon completion of the transaction, the combined entity is expected to be renamed Optos Fiber. Chris Ferguson, CEO of Optos, commented, "Optos has built its reputation and business around major, Fortune 500 corporate customers. It has grown rapidly since inception and has maintained that momentum in the first quarter of 2013. In 2011, we were able to generate more than $11 million in sales and grew that volume organically to north of $40 million in sales in 2012. We are excited about becoming a publicly traded company through the transaction with Beacon. We will now accelerate our growth with better access to capital and accretive add-on acquisitions. The market perceives the dramatic growth for capacity on communications networks by data, video, streaming, social media, mobile commerce and smart technology, and our profile as a public company is anticipated to enhance our prospects in the marketplace." Bruce Widener, the current CEO of Beacon, commented, "We believe this is a very positive development for Beacon stakeholders and we look forward to assisting the new management team in building value for shareholders and partners going forward." Mr. Widener will remain on the Board of Directors of Optos following the transaction and will continue to provide transition services for an interim period. "Optos is a service provider in the telecommunications infrastructure vertical, experiencing an increased growth mode as the industry moves to enable data capabilities," added Mr. Ferguson. "As a data porting enabler, we help rebuild and upgrade the telecom network to manage and enhance broadband and allow for increased data usage. In short, the technology of smart phones has far exceeded the capabilities of the infrastructure. With companies like Facebook and Apple launching new cell phone apps daily, as more and more consumers use their cellphones and other mobile devices for activities other than telephone calls, data and video have become of paramount importance. The current fiber and wireless networks cannot support this expansion. The need to revamp and rebuild the networks is evident in the enormous capital service providers are spending. We believe this is an important development in our goal to assist customers in meeting their infrastructure needs." Under the terms of the Definitive Agreement, it is expected that Optos' members will be issued preferred shares at closing that will convert into a majority of the common shares following a one- for-twenty reverse split. In addition to new management that will be brought in at the operating level, the Board of Directors of Optos is expected to be increased to 7 members. The Company also intends to pursue an uplisting of its shares as soon as possible following the transaction. Beacon and Optos expect to provide greater detail on this transaction, which is slated to close in the second quarter of this year, as well as an operating forecast for the balance of 2013, in the near future. About Beacon Enterprise Beacon Enterprise Solutions Group, Inc., headquartered in Louisville, Ky., provides international telecommunications and information technology systems (ITS) infrastructure services, encompassing a comprehensive suite of consulting, design, installation, and infrastructure management offerings. Beacon's portfolio of infrastructure services spans all professional and construction requirements for design, build and management of telecommunications, network and technology systems infrastructure. Professional services offered include consulting, engineering, program management, project management, construction services and infrastructure management services. Beacon offers these services under either a comprehensive contract option or unbundled to the Company's global and regional clients. The Company's balance sheet at June 30, 2012, showed $7.3 million in total assets, $8.8 million in total liabilities, and a stockholders' deficit of $1.5 million. For the nine months ended June 30, 2012, the Company generated a net loss of $5.9 million, which included a non-cash impairment of intangible assets of $2.1 million and other non-cash expenses aggregating $1.9 million. Cash used in operations amounted to $1.0 million for the nine months ended June 30, 2012. As of June 30, 2012, the Company's accumulated deficit amounted to $42.6 million, with cash and cash equivalents of $75,000 and a working capital deficit of $4.9 million. "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 June 30, 2012. BEATS ELECTRONICS: S&P Assigns 'B+' CCR; Outlook Stable ------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B+' corporate credit rating to Santa Monica, Calif.-based Beats Electronics LLC. The outlook is stable. "At the same time we assigned our 'B+' issue-level rating (the same as the corporate credit rating) to Beats' $700 million proposed senior secured credit facility, consisting of a $200 million revolving credit facility maturing 2018 and $500 million term loan B maturing 2019. The recovery rating on this facility is '3', reflecting our expectations for meaningful recovery (50% to 70%) in the event of a payment default. The proceeds from these facilities together with about $190 million in cash will be used for corporate purposes, including the possibility of up to $400 million in shareholder returns permitted for a specified time period from the close of the transaction, and retire the company's existing $225 million senior secured term loan, resulting in $550 million in drawn debt at the close of the transaction," S&P said. "The 'B+' corporate credit rating on Beats primarily reflects our opinion of the company's aggressive financial policies, narrow product focus, and exposure to changing consumer preferences," said Standard & Poor's credit analyst Chris Johnson. Beats is a leading global provider of premium music headphones, with some presence in the earphone and speaker categories. The company's brand awareness is currently very high, benefiting from the endorsement of several celebrities, including the cofounder, Dr. Dre. As a result, the company has a number one global market share (about 50% share globally) in the premium-priced headphone category, and has good growth opportunities through geographic and product diversification. But given the short track record and swift ascent of the company in a highly competitive market, Standard & Poor's believes there is a near-term risk of demand suddenly dropping if the company's brand stops resonating with consumers or if new entrants provide product substitutes. Still, double-digit sales and earnings growth rates are likely over the next 12 to 18 months. "We believe the company will sustain adequate liquidity, including covenant cushion of at least 15%, and continue to increase sales and EBITDA," said Mr. Johnson. BIG M: Has Until Aug. 5 to Propose Plan of Reorganization --------------------------------------------------------- The U.S. Bankruptcy Court for the District of New Jersey extended Big M, Inc.'s exclusive periods to file a proposed Plan of Reorganization until Aug. 5, 2013, and solicit acceptances for that Plan until Oct. 3, respectively. The owner of the Mandee women's fashion chain requested to keep control of its Chapter 11 case as it prepares to send its assets to auction. Big M has tapped YM Inc. as the stalking horse bidder. About Big M Totowa, New Jersey-based Big M, Inc., owner of Mandee, Annie sez, and Afazxe Stores, filed a Chapter 11 petition (Bankr. D.N.J. Case No. 13-10233) on Jan. 6, 2013 with Salus Capital Partners, LLC, funding the Chapter 11 effort. The Mandee brand is a juniors fashion retailer with 84 stores in Illinois and along the East Coast. Annie sez is a discount department-store retailer for women with 35 stores. Afaze is 10-store jewelry and accessory chain. Kenneth A. Rosen, Esq., at Lowenstein Sandler LLP, in Roseland, serves as counsel to the Debtor. PricewaterhouseCoopers LLP has been tapped to serve as financial advisor. GRL Capital Advisors LLC's Glenn R. Langberg has been hired to serve as chief restructuring officer. The Debtor estimated up to $100 million in both assets and liabilities. The Official Committee of Unsecured Creditors has tapped Cooley LLP as its counsel, and CBIZ Accounting, Tax and Advisory of New York, LLC and CBIZ Mergers & Acquisitions Group as its financial advisor. BIG M: Porzio Bromberg Approved as Special Litigation Counsel ------------------------------------------------------------- The U.S. Bankruptcy Court for the District of New Jersey authorized Big M, Inc. to employ Porzio, Bromberg, & Newman PC as special litigation counsel to Debtor. About Big M Totowa, New Jersey-based Big M, Inc., owner of Mandee, Annie sez, and Afazxe Stores, filed a Chapter 11 petition (Bankr. D.N.J. Case No. 13-10233) on Jan. 6, 2013 with Salus Capital Partners, LLC, funding the Chapter 11 effort. The Mandee brand is a juniors fashion retailer with 84 stores in Illinois and along the East Coast. Annie sez is a discount department-store retailer for women with 35 stores. Afaze is 10-store jewelry and accessory chain. Kenneth A. Rosen, Esq., at Lowenstein Sandler LLP, in Roseland, serves as counsel to the Debtor. PricewaterhouseCoopers LLP has been tapped to serve as financial advisor. GRL Capital Advisors LLC's Glenn R. Langberg has been hired to serve as chief restructuring officer. The Debtor estimated up to $100 million in both assets and liabilities. The Official Committee of Unsecured Creditors has tapped Cooley LLP as its counsel, and CBIZ Accounting, Tax and Advisory of New York, LLC and CBIZ Mergers & Acquisitions Group as its financial advisor. BIG M: Time to Remove Civil Actions Extended to July 8 ------------------------------------------------------ The U.S. Bankruptcy Court for the District of New Jersey extended until July 8, 2013. Big M, Inc.'s period to file a notice of removal with respect to any civil action commenced prior to the filing of the Chapter 11 case until. Totowa, New Jersey-based Big M, Inc., owner of Mandee, Annie sez, and Afazxe Stores, filed a Chapter 11 petition (Bankr. D.N.J. Case No. 13-10233) on Jan. 6, 2013 with Salus Capital Partners, LLC, funding the Chapter 11 effort. The Mandee brand is a juniors fashion retailer with 84 stores in Illinois and along the East Coast. Annie sez is a discount department-store retailer for women with 35 stores. Afaze is 10-store jewelry and accessory chain. Kenneth A. Rosen, Esq., at Lowenstein Sandler LLP, in Roseland, serves as counsel to the Debtor. PricewaterhouseCoopers LLP has been tapped to serve as financial advisor. GRL Capital Advisors LLC's Glenn R. Langberg has been hired to serve as chief restructuring officer. The Debtor disclosed $21,384,430 in assets and $21,374,057 in liabilities as of the Chapter 11 filing. The Official Committee of Unsecured Creditors has tapped Cooley LLP as its counsel, and CBIZ Accounting, Tax and Advisory of New York, LLC and CBIZ Mergers & Acquisitions Group as its financial advisor. BIG M: Taps Porzio Bromberg as Insurance Litigation Counsel ----------------------------------------------------------- Big M, Inc., asks the U.S. Bankruptcy Court for the District of New Jersey for permission to employ Porzio, Bromberg, & Newman P.C. as special insurance litigation counsel. Porzio will assist the Debtor in connection with a claim and litigation against Westport Insurance Company regarding insurance coverage losses resulting from Superstorm Sandy. The Debtor believes that retaining Porzio is reasonable and necessary in order for the Debtor to discharge its responsibilities in connection with the chapter 11 case. Porzio has offered two fee options for the retention: the first, a contingent fee arrangement, and the second, a flat fee arrangement. The contingent fee arrangement is: (a) 31% on the first $750,000 recovered; (b) 37% on the next $350,000 recovered; (c) 40% on any recovery in excess of $1.1 million. The flat fee arrangement is $190,000 for services performed through the start date of trial, plus an additional $50,000 for trying the case. The pretrial portion of the flat fee is to be paid in 12 equal monthly installments with the first installment to be paid on May 10, 2013. The flat fee payment is to be accelerated upon any settlement or resolution of the claim, or upon the entry of and Order confirming a Chapter 11 plan. To best of the Debtor's knowledge, Porzio does not have an interest adverse to the estate with respect to the insurance litigation. About Big M Totowa, New Jersey-based Big M, Inc., owner of Mandee, Annie sez, and Afazxe Stores, filed a Chapter 11 petition (Bankr. D.N.J. Case No. 13-10233) on Jan. 6, 2013 with Salus Capital Partners, LLC, funding the Chapter 11 effort. The Mandee brand is a juniors fashion retailer with 84 stores in Illinois and along the East Coast. Annie sez is a discount department-store retailer for women with 35 stores. Afaze is 10-store jewelry and accessory chain. Kenneth A. Rosen, Esq., at Lowenstein Sandler LLP, in Roseland, serves as counsel to the Debtor. PricewaterhouseCoopers LLP has been tapped to serve as financial advisor. GRL Capital Advisors LLC's Glenn R. Langberg has been hired to serve as chief restructuring officer. The Debtor disclosed $21,384,430 in assets and $21,374,057 in liabilities as of the Chapter 11 filing. The Official Committee of Unsecured Creditors has tapped Cooley LLP as its counsel, and CBIZ Accounting, Tax and Advisory of New York, LLC and CBIZ Mergers & Acquisitions Group as its financial advisor. BISCAYNE PARK: "Excess Value" Suit v. Madison Stays in Dist. Ct. ---------------------------------------------------------------- The action BISCAYNE PARK, LLC v. MADISON REALTY CAPITAL, L.P., Case No. 13-206636-CIV (S.D. Fla.), originally filed in state court, alleges that although a Biscayne Park debt to Madison Realty was completely extinguished, Madison took (a) causes of action belonging to Biscayne Park; and (b) cash/accounts of over $500,000. Under the complaint, Biscayne is seeking to recover the causes of action and the cash/accounts. Madison removed the action to the Florida district court. Presently before the District Court is Madison's motion to dismiss the Biscayne action and Biscayne's motion to remand its action back to state court. The parties' relationship arose from a $150,000 loan used to secured purchase of a certain property. In mid-May 2009, Biscayne defaulted on the loan it obtained from Madison in 2006. The loan was secured by a 2006 mortgage note on the Biscayne Property. Given the default, Madison initiated foreclosure proceedings against Biscayne in state court in July 2009. Biscayne Park filed for bankruptcy during the pendency of the state court action. Biscayne Park was allowed to use cash collateral, and Madison was granted adequate protection and liens on the Property as holder of the 2006 promissory note. When Biscayne Park decided to sell its assets in 2013, Madison's $1 million offer was declared the highest and best bid. The bankruptcy court subsequently entered an order allowing Madison to acquire, among other things, (1) all awards and payments with respect to the Biscayne Property, (2) all causes of action and judgment relating to the Property, (3) all contract rights, causes of actions, claims, demands of Biscayne, and (4) the right to appear, on behalf of Biscayne, in any action or proceeding brought relating to the Property. Madison designated Biscayne Acquisition Group, a separate and distinct legal entity, as title holder to the Biscayne Property and certain cash accounts and causes of action. Once Madison acquired the Property, it moved to foreclose on the mortgage and to determine the value of the Property to fix any deficiency amount. The state court however concluded that the value of the property exceeded Madison's debt claims. Based on the "excess value" order, Biscayne sought to recover funds unnecessarily transferred to Madison but is barred from initiating a counterclaim in the state court foreclosure action based on the terms of the 2006 promissory note. Thus, Biscayne filed its complaint in the district court. On Biscayne' motion to remand, District Judge Kenneth A. Marra said the District Court retains jurisdiction over the "properly removed federal claim." On Madison' motion to dismiss, Judge Marra found that Biscayne has standing to bring its "excess collateral claim". He also opined that res judicata (claim preclusion) and collateral estoppel (issue preclusion) do not bar Biscayne's claim. "It is a separate and distinct claim that arose from the transfer of Biscayne's assets to Madison -- not the underlying loan and foreclosure proceedings between them," the judge said. The judge maintained that Biscayne has not had a full and fair opportunity to litigate the "excess collateral" issue in an earlier case and is thus not precluded from raising it in the complaint. Nevertheless, the District Court agrees that Biscayne's vague references to "cash accounts" and "causes of action" do not put Madison on notice of the nature of Biscayne's claim. Accordingly, the District Court grants in part and denies in part Madison's Motion to Dismiss. Biscayne is given leave to amend its complaint to specify which causes of action and cash accounts it seeks returned, and to add Biscayne Acquisition Group as a party to this action, Judge Marra said. A copy of Judge Marra's May 21, 2013 Omnibus Opinion and Order is available at http://is.gd/rXs6DGfrom Leagle.com. About Biscayne Park LLC Miami, Florida-based Biscayne Park LLC filed for Chapter 11 bankruptcy protection (Bankr. S.D. Fla. Case No. 10-20941) on April 26, 2010. Joel M. Aresty, Esq., who has an office in North Miami Florida, assisted the Company in its restructuring effort. The Company disclosed $13.3 million in assets and $14.3 million in liabilities as of the Petition Date. BLACK PRESS: Proposed $150MM Term Loan Gets Moody's 'B1' Rating --------------------------------------------------------------- Moody's Investors Service assigned a B1 rating to the proposed $150 million first lien US and Canadian term loans of Black Press Ltd.'s subsidiaries, and a Ba3 rating to those companies' new $10 million super priority revolver. Black Press' B3 corporate family rating (CFR) and B3-PD probability of default rating remain on review for possible downgrade pending completion of the refinance transaction. The ratings on existing term loans and subordinated notes will be withdrawn when the transaction closes. Net proceeds from the new $150 million first lien term loans and new $80 million second lien notes (unrated) together with cash on hand will be used to refinance about $136 million of existing term loans and $110 million of subordinated notes. The new $10 million super priority revolving credit facility will not be drawn at close. Should Black Press complete this refinancing as currently contemplated, Moody's will likely confirm the company's B3 CFR and assign a stable outlook to reflect elimination of refinance risk, improved liquidity, and ability to generate free cash flow to repay debt despite its declining organic revenue. Should the refinancing not be completed, Moody's will consider the company's capital structure as unsustainable and the rating will be downgraded, potentially by more than one notch. The review is expected to be completed concurrent with the closing of the transaction. Ratings Assigned: Issuer: Black Press US Partnership $10 million super priority revolver due 2016, Ba3 (LGD1, 1%) $50 million first lien term loan due 2018, B1 (LGD2, 26%) Issuer: Black Press Group Ltd. $100 million first lien term loan due 2018, B1 (LGD2, 26%) Ratings Under Review: Corporate Family Rating, B3 Probability of Default Rating, B3-PD $136 million senior secured term loans A & B due August 2013, Ba3 (LGD2, 23%), to be withdrawn at close $110 million unsecured subordinated notes due February 2014, Caa1 (LGD5, 77%) to be withdrawn at close BLUEJAY PROPERTIES: Has Access to Cash Collateral Until July ------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Kansas approved the deviation from established budget of Bluejay Properties, LLC, and authorized the use of creditor Bankers' Bank of Kansas' cash collateral. The Court in March entered a second extension to the final order authorizing use of cash collateral and granting adequate protection to BBOK and University National Bank until July 31, 2013. As of the Petition Date, BBOK alleges the aggregate principal amount of all obligations owed to it by the Debtor is approximately $13.08 million, plus interest accrued and accruing thereon. UNB additionally asserts that it holds a lien in the sum of $1.2 million under Doc #58-12 and #58-13 As adequate protection from any diminution in value of the lenders' collateral, the Debtor will grant BBOK and UNB replacement security interests and liens, in the same priorities as were present prepetition, and superpriority administrative expense claim status. The Court overruled the limited objection filed by BBOK relating to the variation existing on or before the date of the Debtor's motion. About Bluejay Properties Based in Junction City, Kansas, Bluejay Properties, LLC, doing business as Quinton Point, filed a bare-bones Chapter 11 petition (Bankr. D. Kan. Case No. 12-22680) in Kansas City on Sept. 28, 2012. Bankruptcy Judge Robert D. Berger presides over the case. Todd A. Luckman, Esq., at Stumbo Hanson, LLP in Topeka. The Debtor owns the Quinton Point Apartment Complex in Kansas City valued at $17 million. The Debtor scheduled liabilities of $13,112,325. The petition was signed by Michael L. Thomas of TICC Prop., managing member. Bankers' Bank of Kansas, owed approximately $13.08 million, is represented by Arthur S. Chalmers of Hite, Fanning & Honeyman, LLP. The University National Bank, owed approximately $1.2 million, is represented by Edward J. Nazar of Redmond & Nazar, L.L.P., and Todd Thompson of Thompson Ramsdell & Qualseth, P.A. BOMBARDIER RECREATIONAL: Moody's Retains B1 CFR Following IPO ------------------------------------------------------------- Moody's Investors Service commented that Bombardier Recreational Products Inc. (BRP, B1 stable) IPO completion is credit positive but has no impact on the company's B1 corporate family rating and stable outlook. Bombardier Recreational Products Inc. is a leading global manufacturer of motorized recreational products. The company's products include personal watercraft, snowmobiles, 3-wheeled motorcycles, all-terrain vehicles, side-by-side vehicles, outboard engines and Rotax engines. Revenue for the last fiscal year ended January 31, 2013 was $2.9 billion. BON-TON STORES: Incurs $26.6 Million Net Loss in First Quarter -------------------------------------------------------------- The Bon-Ton Stores, Inc., reported a net loss of $26.63 million on $646.90 million of net sales for the 13 weeks ended May 4, 2013, as compared with a net loss of $40.78 million on $640.77 million of net sales for the 13 weeks ended April 28, 2012. The Company's balance sheet at May 4, 2013, showed $1.59 billion in total assets, $1.51 billion in total liabilities and $84.79 million in total shareholders' equity. Brendan Hoffman, president and chief executive officer, commented, "Our first quarter financial results reflect meaningful progress on our strategic initiatives. Comparable store sales increased in spite of inclement weather. Enhancements to our eCommerce business again yielded double-digit sales growth while we saw increased penetration of proprietary credit card sales due to concentrated efforts to drive this business. Our gross margin rate benefited from a better balanced merchandise mix and a more effective markdown strategy." A copy of the press release is available for free at: http://is.gd/viQvjg About Bon-Ton Stores The Bon-Ton Stores, Inc., with corporate headquarters in York, Pennsylvania and Milwaukee, Wisconsin, operates 273 department stores, which includes 11 furniture galleries, in 24 states in the Northeast, Midwest and upper Great Plains under the Bon-Ton, Bergner's, Boston Store, Carson Pirie Scott, Elder-Beerman, Herberger's and Younkers nameplates and, in the Detroit, Michigan area, under the Parisian nameplate. Bon-Ton Stores disclosed a net loss of $21.55 million for the year ended Feb. 2, 2013, as compared with a net loss of $12.12 million for the year ended Jan. 28, 2012. * * * As reported by the TCR on May 15, 2013, Moody's Investors Service upgraded The Bon-Ton Stores, Inc.'s Corporate Family Rating to B3 from Caa1 and its Probability of Default Rating to B3-PD from Caa1-PD. "The upgrade of Bon-Ton's Corporate Family Rating considers the company's ability to drive modest same store sales growth as well as operating margin expansion beginning in the second half of 2012 and that these positive trends have continued, with the company reporting that its same store were positive, and EBITDA margins expanded, in the first fiscal quarter of 2013," said Moody's Vice President Scott Tuhy. As reported by the TCR on May 17, 2013, Standard & Poor's Ratings Services affirmed the 'B-' corporate credit rating on The Bon-Ton Stores Inc. BOSCH MOTORS: Case Summary & 6 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Bosch Motors, Inc. 1201 E. Winnemucca Boulevard Winnemucca, NV 89445 Bankruptcy Case No.: 13-51055 Chapter 11 Petition Date: May 29, 2013 Court: U.S. Bankruptcy Court District of Nevada (Reno) Judge: Bruce T. Beesley Debtor's Counsel: Stephen R. Harris, Esq. HARRIS & PETRONI, LTD. 417 W. Plumb Lane Reno, NV 89509 Tel: (775) 786-7600 Fax: (775) 786-7764 E-mail: steve@renolaw.biz Estimated Assets: $100,001 to $500,000 Estimated Debts: $1,000,001 to $10,000,000 A copy of the Company's list of its largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/nvb13-51055.pdf Related entities, Lee A. Bosch and Herbert L. Bosch, Jr., also sought bankruptcy protection. The petition was signed by Lee A. Bosch, president. CAESARS ENTERTAINMENT: Bank Debt Trades at 10.24% Discount ---------------------------------------------------------- Participations in a syndicated loan under which Caesars Entertainment Inc. is a borrower traded in the secondary market at 89.76% cents-on-the- dollar during the week ended Friday, May 31, 2013, according to data compiled by LSTA/Thomson Reuters MTM Pricing and reported in The Wall Street Journal. This represents a drop of -0.51 percentage points from the previous week, the Journal relates. The loan matures Jan. 1, 2018. The Company pays 525 basis points above LIBOR to borrow under the facility. The bank debt carries Moody's B3 rating and S&P's B- rating. 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 incurred a net loss of $1.49 billion on $8.58 billion of net revenues for the year ended Dec. 31, 2012, as compared with a net loss of $666.70 million on $8.57 billion of net revenues during the prior year. The Company incurred a $823.30 million net loss in 2010. The Company's balance sheet at March 31, 2013, showed $27.47 billion in total assets, $28.03 billion in total liabilities, and a $560 million total deficit. * * * Caesars Entertainment carries a 'CCC' long-term issuer default rating, with negative outlook, from Fitch and a 'Caa1' corporate family rating with negative outlook from Moody's Investors Service. As reported in the TCR on Feb. 5, 2013, Moody's Investors Service lowered the Speculative Grade Liquidity rating of Caesars Entertainment Corporation to SGL-3 from SGL-2, reflecting declining revolver availability and Moody's concerns that Caesars' earnings and cash flow will remain under pressure causing the company's negative cash flow to worsen. In the May 7, 2013, edition of the TCR, Standard & Poor's Ratings Services said that it lowered its corporate credit ratings on Las Vegas-based Caesars Entertainment Corp. (CEC) and wholly owned subsidiary Caesars Entertainment Operating Co. (CEOC) to 'CCC+' from 'B-'. "The downgrade reflects weaker-than-expected operating performance in the first quarter, and our view that Caesars' capital structure may be unsustainable over the next two years based on our EBITDA forecast for the company," said Standard & Poor's credit analyst Melissa Long. CAI INTERNATIONAL: S&P Affirms 'BB' Corp. Credit Rating ------------------------------------------------------- Standard & Poor's Ratings Services said that it affirmed its 'BB' long-term corporate credit rating on San Francisco-based CAI International Inc. (CAI). The outlook is stable. At the same time, S&P affirmed its 'BBB-' rating on the $103 million senior secured notes issued by subsidiary Container Applications Ltd. and guaranteed by CAI. The recovery rating on the notes is unchanged at '1', indicating S&P's expectation of a very high (90%-100%) recovery in a payment default. "The ratings on CAI reflect our view that the company's financial profile will likely stay close to current levels over the next two years, following an increase in debt to finance the company's aggressive fleet expansion plans," said Standard & Poor's credit analyst Funmi Afonja. "Although we expect that the slowing global economy could have some modest impact on utilization and lease rates, we believe that the stability that the long-term leases provide should help limit variability to revenues and earnings and provide some cushion against cyclical pressures". S&P's base-case scenario generates the following credit measures over the next two years: -- Funds flow from operations (FFO) to total debt (adjusted for operating leases) in the low-teens percent area, and -- Debt to capital in the low-70% area. These credit measures could vary based on the impact of market fundamentals on revenues and the timing of capital spending over the next year. S&P considers these levels acceptable for the rating. Similar to other providers of transportation equipment operating leases, CAI is more highly leveraged than comparably rated industrial companies. The credit measures in S&P's base- case forecast compare with FFO to total debt of 13.9% and debt to capital of 74.3% in the 12 months ended March 31, 2013. The ratings on CAI Also reflect the company's solid position within the marine cargo container leasing industry and the relatively stable earnings and cash flow it generates from a substantial proportion of long-term leases. The ratings also incorporate the cyclicality of the marine cargo container leasing industry and CAI's substantial and increasing debt burden. S&P categorizes CAI's business risk profile as "fair," its financial risk profile as "significant," liquidity as "adequate," and management as "fair," under our criteria. The outlook is stable. Standard & Poor's believes that CAI will maintain its financial profile over the next 18 months as the company realizes full-year earnings from an expanded fleet. S&P's assessment takes into account continued debt-financed fleet expansion, albeit at a moderated pace. S&P could lower the ratings if earnings do not improve as it expects or if the company adopts a more aggressive financial policy, causing FFO to debt to fall to less than 10% or debt to capital to increase to more than 75% for a sustained period. Although less likely, S&P could raise the rating if revenues and earnings growth exceed its expectations, causing FFO to debt to approach 20% on a sustained basis or if there is a material debt reduction. CAMCO FINANCIAL: Stockholders Elect Three Directors --------------------------------------------------- At its 2013 annual meeting of stockholders held on May 21, Camco Financial Corporation's stockholders: (1) elected Terry A. Feick, Edward D. Goodyear and Timothy Young as directors for three year terms to expire at the 2016 Annual Meeting of Shareholders; (2) approved Camco's 2013 Equity Plan; (3) approved an advisory vote on executive compensation; (4) approved the holding of the advisory vote on executive compensation every year; and (5) ratified the selection of Plante & Moran, PLLC, as Camco's independent registered public accounting firm for the 2013 fiscal year. Other directors whose term of office continued after the Annual Meeting are: Norman G. Cook Andrew S. Dix James D. Douglas James E. Huston Carson K. Miller James P. Spragg Jeffrey T. Tucker About Camco Financial Cambridge, Ohio-based Camco Financial Corporation is a bank holding company that was organized under Delaware law in 1970. Camco is engaged in the financial services business in Ohio, Kentucky and West Virginia, through its wholly-owned subsidiary, Advantage Bank, an Ohio bank. On March 31, 2011, Camco divested activities related to Camco Title Agency and decertified as a financial holding company. Camco remains a bank holding company and continues to be regulated by the Federal Reserve Board. Plante & Moran PLLC, in Auburn Hills, Michigan, noted that the Corporation's bank subsidiary is not in compliance with revised minimum regulatory capital requirements under a formal regulatory agreement with the banking regulators, and that failure to comply with the regulatory agreement may result in additional regulatory enforcement actions. As discussed in Note K, Camco's wholly-owned subsidiary Advantage Bank's Tier 1 capital does not meet the requirements set forth in the 2012 Consent Order. As a result, the Corporation will need to increase capital levels. The Corporation reported net earnings of $4.2 million on net interest income (before provision for loan losses) of $23.9 million in 2012, compared with net earnings of $214,000 on net interest income of $214,000 on net interest income (before provision for loan losses) of $25.9 million in 2011. The Company's balance sheet at March 31, 2013, showed $763.36 million in total assets, $702.65 million in total liabilities and $60.71 million in total stockholders' equity. CANYON PORT: Jordan Hyden Directed to Provide Breakdown of Fees --------------------------------------------------------------- Bankruptcy Judge Richard S. Schmidt directed counsel for Canyon Port Holdings, LLC, and Canyon Supply & Logistics, LLC, to submit a proposed order detailing a breakdown of fees and expenses payable and those attributable to the McDermott litigation. The Debtor's counsel, Jordan, Hyden, Womble, Culbreth & Holzer, P.C., filed a Second Interim Application for Approval of Attorney's Fees and Expenses Incurred. The Court having heard the arguments of counsel, including the objection of the Official Committee of Unsecured Creditors, finds that all fees and expenses were reasonable and necessary and should be approved. The Court further finds, however, that any fees or expenses incurred in anticipation of or in the course of preparation and prosecution of the McDermott litigation should not be paid from funds derived from the settlement with the Port of Corpus Christi because the Debtors have not proposed that general unsecured creditors benefit from any return from the litigation filed against McDermott. Accordingly, the Court finds that while those fees are approved, they may not be paid until further Court order. A copy of the Court's May 28, 2013 Memorandum Opinion is available at http://is.gd/gI2qnrfrom Leagle.com. About Canyon Port Canyon Port Holdings, fka as Canyon Supply and Logistics, filed for Chapter 11 bankruptcy protection (Bankr. S.D. Tex. Case No. 12-20314) on June 10, 2012. U.S. Bankruptcy Judge Richard S. Schmidt presides over the case. Richard L. Fuqua II, Esq., at Fuqua & Associates PC, represents the Debtor. CBS I: Charles E. Jack Approved to Provide Appraisal Services ------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Nevada authorized CBS I, LLC, to employ Charles E. Jack IV, MAI as appraiser. CBS I, LLC, filed for Chapter 11 protection (Bankr. D. Nev. Case No. 12-16833) on June 7, 2012. The Company is a limited liability company whose sole asset consists of 71,546 square feet of gross rentable building area on a site containing approximately 206,474 net square feet or 4.74 acres, located at 10100 West Charleston Boulevard, in Las Vegas, Nevada. Debtor is owned by Jeff Susa (25%), Breslin Family Trust (25%), M&J Corrigan Family Trust (25%) and S&L Corrigan Family Trust (25%). The Debtor scheduled assets of $19,356,448 and liabilities of $19,422,805. Judge Mike K. Nakagawa presides over the case. Jeff Susa signed the petition as manager. The bankruptcy filing came after U.S. Bank, trustee for holders of the $16.4 million mortgage, initiated foreclosure proceedings and filed a lawsuit May 24, 2012, in Clark County District Court asking that a receiver be appointed to take control of the Summerlin building in Howard Hughes Plaza at 10100 West Charleston Blvd., just west of Hualapai Way. Zachariah Larson, Esq., at Marquis Aurbach Coffing, in Las Vegas, represents the Debtor as bankruptcy counsel. Dimitri P. Dalacas, Esq., at Flangas McMillan Law Group, in Las Vegas, represents the Debtor as special counsel. CENTRAL EUROPEAN: Confirms Prepackaged Plan of Reorganization ------------------------------------------------------------- Central European Distribution Corporation confirmed that CEDC's Prepackaged Plan of Reorganization, which was approved by the U.S. Bankruptcy Court for the District of Delaware on May 13, 2013, is expected to become effective within three business days, by June 5, 2013. Following the effective date, CEDC will make a cash payment to holders of its 2013 Convertible Notes and certain of its 2016 Senior Secured Notes and issue new notes to holders of its 2016 Senior Secured Notes and new shares to Roust Trading Ltd. All of the previously issued 2013 Convertible Notes and 2016 Senior Secured Notes and shares of outstanding CEDC common stock will be cancelled. The Plan will result in a reduction of approximately $665.2 million of debt of CEDC. As a result of the cancellation of CEDC's common stock, as of the effective date CEDC anticipates it will cease to be a public company in Poland and that its common stock will no longer be subject to listing and trading on the Warsaw Stock Exchange. RTL, owned by Mr. Roustam Tariko, will receive 100% of the outstanding stock of the reorganized CEDC in exchange for funding CEDC's cash payments under the Plan and cancelling CEDC's existing debt obligations to RTL. In addition, CEDC announced that on Wednesday, May 28, Alfa Bank, one of CEDC's significant financial partners in Russia, resumed lending to CEDC by providing access to previously established credit lines with the bank. CEDC was able to draw down 1 billion Russian roubles (approximately $30 million U.S. dollars equivalent) under these credit lines, thereby further enhancing the liquidity position of its operations in advance of the effective date. Distributions by CEDC to holders of the 2013 Convertible Notes are expected to be made following the effective date of the Plan. Distributions by CEDC to holders of 2016 Senior Secured Notes are expected to be made as soon as practicable after CEDC confirms elections under the Plan's cash option. CEDC anticipates that the cash option elections will be confirmed five business days following the effective date and that cash distributions to holders of 2016 Senior Secured Notes will be made on or about five business days following the effective date, and that distribution of new notes to holders of 2016 Senior Secured Notes will be made on or about ten business days following the effective date. CEDC and its U.S. subsidiaries, CEDC Finance Corporation International, Inc. and CEDC Finance Corporation LLC (collectively CEDC FinCo), commenced voluntary proceedings under Chapter 11 of the U.S. Bankruptcy Code on April 7, 2013. The Chapter 11 filing did not involve CEDC's operating subsidiaries in Poland, Russia, Ukraine or Hungary. Those operations, which are independently funded and generate their own revenues, have continued normally and without interruption during the U.S. restructuring process. Copies of documents filed by CEDC in its Chapter 11 proceedings before the U.S. Bankruptcy Court for the District of Delaware, including the Findings of Fact, Conclusions of Law and Order confirming the Second Amended and Restated Joint Prepackaged Chapter 11 Plan of Reorganization of Central European Distribution Corporation, ET. al., are available without charge at: http://gcginc.com/cases/cedc About CEDC Mt. Laurel, New Jersey-based Central European Distribution Corporation is one of the world's largest vodka producers and Central and Eastern Europe's largest integrated spirit beverages business with its primary operations in Poland, Russia and Hungary. On April 7, 2013, CEDC and two subsidiaries sought bankruptcy protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 13-10738) with a prepackaged Chapter 11 plan that reduces debt by US$665.2 million. Attorneys at Skadden, Arps, Slate, Meagher & Flom LLP serve as legal counsel to the Debtor. Houlihan Lokey is the investment banker. Alvarez & Marsal will provide the chief restructuring officer. GCG Inc. is the claims and notice agent. The Bankruptcy Court approved the Disclosure Statement and confirmed the Second Amended and Restated Joint Prepackaged Plan of Reorganization. CENTRAL EUROPEAN: RTL Extends Exchange Offer for 3% Senior Notes ---------------------------------------------------------------- Roust Trading Ltd. on May 31 disclosed that it has extended the expiration date for its private offer to exchange each $1,000 principal amount of validly tendered and accepted 3.00% Convertible Senior Notes due 2013 of Central European Distribution Corporation for (1) $193.17 principal amount of new Senior Secured PIK Toggle Notes due 2016 of RTL and (2) $160.97 in cash. The Exchange Offer will now expire at 12:00 Noon, New York City time, on May 31, 2013, unless extended further. The Exchange Offer was previously scheduled to expire at 9:00 a.m., New York City time, on May 30, 2013. As of 9:00 a.m., New York City time, on May 30, 2013, holders had validly tendered $146,711,000 aggregate principal amount of the Existing CEDC Notes. Holders who have already tendered their Existing CEDC Notes need not take any additional action in order to tender their Existing CEDC Notes. In order to receive the New RTL Notes and cash consideration, a tendering holder of Existing CEDC Notes must, among other conditions described in the Exchange Offer documents, have submitted (and not withdrawn, amended or revoked) a ballot to accept CEDC's amended and restated joint prepackaged chapter 11 plan of reorganization. The deadline to vote to accept or reject the Plan of Reorganization expired on April 4, 2013, and on May 13, 2013, the bankruptcy court confirmed the Plan of Reorganization. Holders of Existing CEDC Notes who have not submitted ballots to accept the Plan of Reorganization are not eligible to receive the New RTL Notes and cash consideration in the Exchange Offer. Tendered Existing CEDC Notes cannot be withdrawn, except (i) upon termination of the agreement between RTL and an ad hoc committee composed of holders of Existing CEDC Notes related to certain proposed restructuring transactions with respect to the Existing CEDC Notes, (ii) to the extent that any material term of the Exchange Offer (as reasonably determined by RTL) is amended or changed subsequent to the date of such tender or (iii) as may be required by applicable law. The Exchange Offer is being made only to holders of Existing CEDC Notes that have completed and returned an eligibility letter pursuant to which such holder represents and warrants that it is either (a) an institutional "accredited investor" (within the meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act of 1933, as amended (the "Securities Act")), (b) a non-institutional "accredited investor" (within the meaning of Rule 501(a)(4), (5), (6) or (8) of Regulation D under the Securities Act) or (c) a person other than a "U.S. Person" (as defined in Rule 902 of Regulation S under the Securities Act). The New RTL Notes have not been and will not be registered under the Securities Act, or any state securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements, and will therefore be subject to substantial restrictions on transfer. This announcement does not constitute an offer to sell, or the solicitation of an offer to buy, any security and shall not constitute an offer, solicitation or sale of any security in any jurisdiction in which such offer, solicitation or sale would be unlawful. No recommendation is made as to whether the holders of Existing CEDC Notes should tender their Existing CEDC Notes for exchange in the Exchange Offer. The Garden City Group, Inc. is acting as the Information Agent for the Exchange Offer. Global Bondholder Services Corporation is acting as the Exchange Agent for the Exchange Offer. Eligible holders of Existing CEDC Notes can contact the Information Agent to request Exchange Offer documents at (202) 471-4571 or toll free at (866) 256-1123. About CEDC Mt. Laurel, New Jersey-based Central European Distribution Corporation is one of the world's largest vodka producers and Central and Eastern Europe's largest integrated spirit beverages business with its primary operations in Poland, Russia and Hungary. On April 7, 2013, CEDC and two subsidiaries sought bankruptcy protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 13-10738) with a prepackaged Chapter 11 plan that reduces debt by US$665.2 million. Attorneys at Skadden, Arps, Slate, Meagher & Flom LLP serve as legal counsel to the Debtor. Houlihan Lokey is the investment banker. Alvarez & Marsal will provide the chief restructuring officer. GCG Inc. is the claims and notice agent. The Bankruptcy Court approved the Disclosure Statement and confirmed the Second Amended and Restated Joint Prepackaged Plan of Reorganization. CENTRAL FEDERAL: Stockholders Elect Three Directors --------------------------------------------------- Central Federal Corporation held its annual meeting on May 16, 2013, at which the stockholders elected Thomas P. Ash, James H. Frauenberg II and Donal Malenick to the Board of Directors. The stockholders also: (a) approved a non-binding advisory vote on the compensation of executives; (b) approved a proposal to hold future advisory votes on the compensation of the Company's named executive officers every year; (c) approved the First Amendment to the Central Federal Corporation 2009 Equity Compensation Plan to increase the number of shares of common stock reserved for awards thereunder to 1,500,000; and (d) ratified the appointment of Crowe Horwath LLP as the Company's independent registered public accounting firm for the year ending Dec. 31, 2013. In a separate press release, Central Federal, the parent company of CFBank, announced the appointment of Robert H. Milbourne as a director of the Company and CFBank. Mr. Milbourne has been engaged in economics, strategic planning, mergers and acquisitions of Fortune 500 companies as well as working as State Budget Director in Wisconsin. He earned his Bachelor's degree in economics with honors at the University of Wisconsin in Madison. He also has a Master's in Public Policy at the University of Wisconsin. He attended the Harvard Business School where he completed the Advanced Management Program. Mr. Milbourne was the first President and CEO of the Columbus Partnership, an organization of leading CEOs in Central Ohio that aims to improve the economic growth of the region. He also led a similar group in Milwaukee, Wisconsin for 17 years. He has over 30 years of experience in the financial world. He currently is the head of RHM Advisors, a business consulting firm, specializing in business strategy, financing, and corporate development for public and private companies. He is also a consultant to business for government affairs, governance and project development. Bob Hoeweler, Chairman of the Board, commented, "We welcome Bob to the Board and look forward to working with him. Bob's skills and experience augment those of the current Board members. Additionally, Bob has served on many corporate and nonprofit boards." Tim O'Dell, CEO, added, "We are excited to have Bob Milbourne join the Board of CFBank and Central Federal Corporation. Bob has many levels of business experience and is well connected to the local business community. Serving small to mid-sized businesses along with the executives and entrepreneurs who own and run them is the key focus of CF Bank. Bob's business background and business connections will enable him to be a strong contributor in helping us to ensure the success and growth of CFBank." About Central Federal Fairlawn, Ohio-based Central Federal Corporation (Nasdaq: CFBK) is the holding company for CFBank, a federally chartered savings association formed in Ohio in 1892. CFBank has four full-service banking offices in Fairlawn, Calcutta, Wellsville and Worthington, Ohio. In the auditors' report accompanying the consolidated financial statements for the year ended Dec. 31, 2011, Crowe Horwath LLP, in Cleveland, Ohio, expressed substantial doubt about the Company's ability to continue as a going concern. The Company's auditors noted that the Holding Company and its wholly owned subsidiary (CFBank) are operating under regulatory orders that require among other items, higher levels of regulatory capital at CFBank. The Company has suffered significant recurring net losses, primarily from higher provisions for loan losses and expenses associated with the administration and disposition of nonperforming assets at CFBank. These losses have adversely impacted capital at CFBank and liquidity at the Holding Company. At Dec. 31, 2011, regulatory capital at CFBank was below the amount specified in the regulatory order. Failure to raise capital to the amount specified in the regulatory order and otherwise comply with the regulatory orders may result in additional enforcement actions or receivership of CFBank. Regulatory Matters On May 25, 2011, Central Federal Corporation and CFBank each consented to the issuance of an Order to Cease and Desist (the Holding Company Order and the CFBank Order, respectively, and collectively, the Orders) by the Office of Thrift Supervision (OTS), the primary regulator of the Holding Company and CFBank at the time the Orders were issued. The Holding Company Order required it, among other things, to: (i) submit by June 30, 2011, a capital plan to regulators that establishes a minimum tangible capital ratio commensurate with the Holding Company's consolidated risk profile, reduces the risk from current debt levels and addresses the Holding Company's cash flow needs; (ii) not pay cash dividends, redeem stock or make any other capital distributions without prior regulatory approval; (iii) not pay interest or principal on any debt or increase any Holding Company debt or guarantee the debt of any entity without prior regulatory approval; (iv) obtain prior regulatory approval for changes in directors and senior executive officers; and (v) not enter into any new contractual arrangement related to compensation or benefits with any director or senior executive officer without prior notification to regulators. The CFBank Order required CFBank to have by Sept. 30, 2011, and maintain thereafter, 8% Tier 1 (Core) Capital to adjusted total assets and 12% Total Capital to risk weighted assets. CFBank will not be considered well-capitalized as long as it is subject to individual minimum capital requirements. CFBank did not comply with the higher capital ratio requirements by the Sept. 30, 2011, required date. For the year ended Dec. 31, 2012, the Company a net loss of $3.76 million on $4.63 million of net interest income, as compared with a net loss of $5.42 million on $6.17 million of net interest income for the year ended Dec. 31, 2011. The Company's balance sheet at March 31, 2013, showed $216.43 million in total assets, $193.57 million in total liabilities and $22.86 million in total stockholders' equity. CENTRAL FEDERAL: John Lawell Quits as CFBank SVP Operations ----------------------------------------------------------- John S. Lawell submitted his resignation as Senior Vice President, Operations of CFBank, effective as May 31, 2013. About Central Federal Fairlawn, Ohio-based Central Federal Corporation (Nasdaq: CFBK) is the holding company for CFBank, a federally chartered savings association formed in Ohio in 1892. CFBank has four full-service banking offices in Fairlawn, Calcutta, Wellsville and Worthington, Ohio. In the auditors' report accompanying the consolidated financial statements for the year ended Dec. 31, 2011, Crowe Horwath LLP, in Cleveland, Ohio, expressed substantial doubt about the Company's ability to continue as a going concern. The Company's auditors noted that the Holding Company and its wholly owned subsidiary (CFBank) are operating under regulatory orders that require among other items, higher levels of regulatory capital at CFBank. The Company has suffered significant recurring net losses, primarily from higher provisions for loan losses and expenses associated with the administration and disposition of nonperforming assets at CFBank. These losses have adversely impacted capital at CFBank and liquidity at the Holding Company. At Dec. 31, 2011, regulatory capital at CFBank was below the amount specified in the regulatory order. Failure to raise capital to the amount specified in the regulatory order and otherwise comply with the regulatory orders may result in additional enforcement actions or receivership of CFBank. Regulatory Matters On May 25, 2011, Central Federal Corporation and CFBank each consented to the issuance of an Order to Cease and Desist (the Holding Company Order and the CFBank Order, respectively, and collectively, the Orders) by the Office of Thrift Supervision (OTS), the primary regulator of the Holding Company and CFBank at the time the Orders were issued. The Holding Company Order required it, among other things, to: (i) submit by June 30, 2011, a capital plan to regulators that establishes a minimum tangible capital ratio commensurate with the Holding Company's consolidated risk profile, reduces the risk from current debt levels and addresses the Holding Company's cash flow needs; (ii) not pay cash dividends, redeem stock or make any other capital distributions without prior regulatory approval; (iii) not pay interest or principal on any debt or increase any Holding Company debt or guarantee the debt of any entity without prior regulatory approval; (iv) obtain prior regulatory approval for changes in directors and senior executive officers; and (v) not enter into any new contractual arrangement related to compensation or benefits with any director or senior executive officer without prior notification to regulators. The CFBank Order required CFBank to have by Sept. 30, 2011, and maintain thereafter, 8% Tier 1 (Core) Capital to adjusted total assets and 12% Total Capital to risk weighted assets. CFBank will not be considered well-capitalized as long as it is subject to individual minimum capital requirements. CFBank did not comply with the higher capital ratio requirements by the Sept. 30, 2011, required date. CENTURY PLAZA: Has Access to Cash Collateral Until July ------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Indiana authorized Century Plaza, LLC's continued use of cash collateral until July 31, 2013. The Hon. J. Philip Klingeberger has already entered 14 interim orders allowing the Debtor to use cash collateral. A hearing concerning further extension will be held on July 18, at 10:30 a.m. The Court's interim orders authorize the Debtor's use of PrivateBank and Trust Company's cash collateral to fund its business operations postpetition. The Debtor is authorized to make expenditures plus more than 10% of the total proposed expenses, unless otherwise agreed by the lender or upon further Court order. As adequate protection for any diminution in value of the lenders' collateral, the Debtors will: -- grant the lender authorization to inspect, upon reasonable notice, the Debtor's book and records; -- maintain and pay premiums for insurance to cover all of its assets from fire, theft and water damage; -- maintain sufficient cash reserves for the payment of current real estate taxes when the real estate taxes become due and payable; -- upon reasonable request, make available to the lender evidence of that which constitutes it collateral or proceeds, and -- maintain the property in good repair and properly manage the property. About Century Plaza Based in Merrillville, Indiana, Century Plaza LLC owns and operates a commercial shopping center known as "Century Plaza". It filed for Chapter 11 bankruptcy (Bankr. N.D. Ind. Case No. 11-24075) on Oct. 18, 2011. Judge J. Philip Klingeberger presides over the case. Crane, Heyman, Simon, Welch & Clar serves as the Debtor's counsel. Anderson & Anderson P.C. serves as local bankruptcy counsel. The Debtor estimated assets and debts at $10 million to $50 million. The petition was signed by Richard Dube, president of Tri-Land Properties, Inc., manager. The Plan provides for distributions to the holders of Allowed Claims from funds realized by the Debtor from the continued operation of the Debtor's business by the Debtor as well as from existing cash deposits and cash resources of the Debtor. CLAIRE'S STORES: Incurs $26.6 Million Net Loss in 1st Quarter ------------------------------------------------------------- Claire's Stores, Inc., reported a net loss of $26.58 million on $354 million of net sales for the three months ended May 4, 2013, as compared with a net loss of $19.92 million on $340.61 million of net sales for the three months ended April 28, 2012. The Company's balance sheet at May 4, 2013, showed $2.87 billion in total assets, $2.92 billion in total liabilities and a $47.85 million stockholders' deficit. A copy of the press release is available for free at: http://is.gd/W4FfPg About Claire's Stores Claire's Stores, Inc. -- http://www.clairestores.com/-- operates as a specialty retailer of fashion accessories and jewelry for preteens and teenagers, as well as for young adults in North America and internationally. It offers jewelry products that comprise costume jewelry, earrings, and ear piercing services; and accessories, including fashion accessories, hair ornaments, handbags, and novelty items. Based in Pembroke Pines, Florida, Claire's Stores operates under two brands: Claire's(R), which operates worldwide and Icing(R), which operates only in North America. As of Jan. 31, 2009, Claire's Stores, Inc., operated 2,969 stores in North America and Europe. Claire's Stores also operates through its subsidiary, Claire's Nippon, Co., Ltd., 213 stores in Japan as a 50:50 joint venture with AEON, Co., Ltd. The Company also franchises 198 stores in the Middle East, Turkey, Russia, South Africa, Poland and Guatemala. Claire's Stores disclosed net income of $1.28 million on $1.55 billion of net sales for the fiscal year ended Feb. 2, 2013, as compared with net income of $11.63 million on $1.49 billion of net sales for the fiscal year ended Jan. 28, 2012. Bankruptcy Warning The Company said the following statement in its annual report for the fiscal year ended Feb. 2, 2013. "If we are unable to generate sufficient cash flow and are otherwise unable to obtain funds necessary to meet required payments of principal, premium, if any, and interest on our indebtedness, or if we otherwise fail to comply with the various covenants, including financial and operating covenants in the instruments governing our indebtedness, we could be in default under the terms of the agreements governing such indebtedness. In the event of such default: * the holders of such indebtedness may be able to cause all of our available cash flow to be used to pay such indebtedness and, in any event, could elect to declare all the funds borrowed thereunder to be due and payable, together with accrued and unpaid interest; * the lenders under our Credit Facility could elect to terminate their commitments thereunder, cease making further loans and institute foreclosure proceedings against our assets; and * we could be forced into bankruptcy or liquidation," according to the Company's annual report for the fiscal year ended Feb. 2, 2013. * * * As reported by the TCR on Oct. 1, 2012, Moody's Investors Service upgraded Claire's Stores, Inc.'s Corporate Family and Probability of Default ratings to Caa1 from Caa2. The upgrade of Claire's Corporate Family Rating to Caa1 reflects its ability to address its substantial term loan maturity in 2014 by refinancing it with a $625 million add-on to its existing senior secured first lien notes due 2019. Claire's Stores, Inc., carries a 'B-' corporate credit rating from Standard & Poor's Ratings Services. CLEAR CHANNEL: Randall Mays Quits From Board -------------------------------------------- Randall T. Mays did not stand for re-election as a member of the Board of Directors of CC Media Holdings, Inc., the Company's indirect parent entity, and ceased to be a director of CC Media Holdings, Inc., on May 17, 2013. In connection with ceasing to be a director of CC Media Holdings, Inc., Mr. Mays resigned as a member of Clear Channel Communications, Inc.'s Board of Directors on May 17, 2013, and the size of the Company's Board of Directors was reduced from 13 to 12. About Clear Channel Communications San Antonio, Texas-based Clear Channel Communications, Inc., an indirect subsidiary of CC Media Holdings, Inc. (OTCBB: CCMO), is one of the leading global media and entertainment companies specializing in radio, digital, outdoor, mobile, live events, and on-demand entertainment and information services for local communities and providing premier opportunities for advertisers. CC Media Holdings Inc. -- http://www.ccmediaholdings.com/-- is a global media and entertainment company. Its businesses include radio and outdoor displays. Clear Channel's balance sheet at March 31, 2013, showed $15.51 billion in total assets, $23.72 billion in total liabilities and a $8.20 billion total shareholders' deficit. As reported by the Troubled Company Reporter on May 21, 2013, Moody's Investors Service said that Clear Channel Communications, Inc.'s upsize of the term loan D to $4 billion from $1.5 billion will not impact the Caa1 facility rating assigned. Clear Channel's Corporate Family Rating is unchanged at Caa2. The outlook remains Stable. As reported by the Troubled Company Reporter on May 21, 2013, Standard & Poor's Ratings Services announced that its issue-level rating on San Antonio, Texas-based Clear Channel Communications Inc.'s senior secured term loan remains unchanged at 'CCC+' following the company's upsize of the loan to $4 billion from $1.5 billion. The rating on parent company CC Media Holdings Inc. remains at 'CCC+' with a negative outlook, which reflects the risks surrounding the long-term viability of the company's capital structure. CLEARWATER SEAFOODS: Proposed Term Loans Get Moody's 'B1' Ratings ----------------------------------------------------------------- Moody's Investors Service assigned B1 ratings to Clearwater Seafoods Limited Partnership's proposed term loans A and B, affirmed the company's B2 corporate family rating, lowered the probability of default rating to B3-PD from B2-PD, and revised the company's speculative grade liquidity rating to SGL-3 (adequate) from SGL-2 (good). The B1 ratings on Clearwater's existing term loans A and B were affirmed and will be withdrawn when the refinance transaction closes. Clearwater's rating outlook remains stable. Net proceeds from the term loans plus $25 million of drawings under a new $60 million revolving credit facility (unrated) will be used to refinance about $205 million of existing term loans and ABL revolver drawings, and to repay $45 million outstanding convertible debentures. A new $45 million delayed draw term loan A will also be available to the company to fund a clam vessel project over the next 18 months. Moody's affirmed Clearwater's B2 CFR as the refinance transaction will not materially alter its pro forma leverage (adjusted Debt/EBITDA around 4x remain in line with the rating category). The PDR was lowered because the company's new debt capital is comprised of only bank debt. The downgrade in the SGL rating reflects lower internally generated free cash flow expectations for the next 4 quarters driven mainly by elevated capital expenditures to fund growth initiatives and higher dividend payments. Ratings Assigned: $30M first lien term loan A due 2018, B1 (LGD2, 28%) $45M delayed draw first lien term loan A due 2018, B1 (LGD2, 28%) $200M first lien term loan B due 2019, B1 (LGD2, 28%) Ratings Affirmed: Corporate Family Rating, B2 $68 million first lien term loan A due June 2017, B1 (LGD3, 44%); to be withdrawn at close $125 million first lien term loan B due June 2018, B1 (LGD3, 44%); to be withdrawn at close Downgrade Action: Probability of Default Rating, to B3-PD from B2-PD Speculative Grade Liquidity Rating, to SGL-3 from SGL-2 Outlook: Maintained as Stable Ratings Rationale: Clearwater's B2 corporate family rating ("CFR") primarily reflects its small scale relative to peers in the protein and agriculture industry, exposure to exogenous factors such as foreign currency fluctuations, poor weather, foreign trade disputes and regulation, and expectations that its growth aspirations could increase leverage (adjusted Debt/EBITDA was 3.9x at Q1/13). The rating benefits from the company's position as the largest integrated shellfish company in North America, its ownership of solid quotas that creates significant barriers to entry, attractive long term growth prospects in the premium seafood industry supported by growing demand from emerging markets, and good geographic and customer diversity. Moody's considers Clearwater's liquidity as adequate, reflected by the SGL-3 rating. This is supported by cash of $16 million at Q1/13, expectations for annual internally generated free cash flow of about $5 million, and about $35 million of availability under a new $60 million revolving credit facility that matures in 2018. These sources are sufficient to cover annual term loan amortizations of about $5 million. Moody's lower free cash flow expectation for Clearwater is influenced by elevated capital expenditures to fund growth initiatives, likelihood for increased working capital requirements and higher dividend payments. The company's new credit facilities will be subject to a total leverage covenant which Moody's expects will be set to provide cushion over 20%. The stable rating outlook reflects Moody's expectation that the company will be able to manage its cash flow and earnings volatility, and will sustain its leverage below 4x in the next 12 to 18 months. An upgrade in Clearwater's ratings will require that the company maintain ample liquidity with consistent positive free cash flow generation on an annual basis, and improve its profitability such that EBITA margin is maintained consistently above 10%, EBITA/Interest approaches 2.5x and Debt/EBITDA is sustained below 3.5x, all incorporating Moody's standard accounting adjustments. Clearwater's ratings could be downgraded if operating results soften such that adjusted EBITA/Interest declines below 1.5x, free cash flow remains negative or Debt/EBITDA rises above 5x. Significant deterioration in liquidity and material debt-funded acquisitions could also lead to a downgrade. The principal methodology used in this rating was the Global Food - Protein and Agriculture Industry published in September 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. Clearwater Seafoods Limited Partnership is a vertically-integrated harvester, processor, and distributor of premium shellfish and the largest holder of shellfish licenses and quotas in Canada. Revenue for the last twelve months ended March 31, 2013 was about $350 million. The company is headquartered in Bedford, Nova Scotia, Canada. CODA HOLDINGS: White & Case Can't Rep Co. in Ch. 11 --------------------------------------------------- Matt Chiappardi of BankruptcyLaw360 reported that a Delaware bankruptcy court judge would not allow White & Case LLP to serve as the primary counsel for electric car maker Coda Holdings Inc. during its Chapter 11 proceedings, ruling that it was a conflict of interest for one of the firm's partners to have recently held an executive position with the debtor. Coda has argued that there is no problem with White & Case representing the company during its Chapter 11 process despite objections from the U.S. Trustee's Office over a partner at the firm recently holding an executive position with the bankrupt electric carmaker. In a motion in the Delaware Bankruptcy Court, Coda argued that although White & Case partner Christopher Rose was the company's general counsel and senior vice president of corporate development until mid-2012, he is not working on the bankruptcy case. Mr. Rose joined White & Case in September, which amounts to a conflict that should disqualify the firm from advising Coda, according to an objection filed by Trustee Roberta A. DeAngelis. About CODA Holdings Los Angeles, California-based CODA Energy -- http://www.codaenergy.com-- made an electric auto that was a commercial failure. The company marketed the Coda Sedan, which sold only 100 copies. It was an electrically powered version of the Hafei Saibao, made in China. After bankruptcy, Los Angeles- based Coda intends to concentrate on making stationery electric- storage systems. CODA Holdings, Inc., Coda Energy LLC and three other affiliates filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 13-11153) on May 1, 2013, to enable the Company to complete a sale, confirm a plan, and emerge from bankruptcy in a stronger position to execute its new business plan. The Company expects the sale process to take 45 days to complete. FCO MA CODA Holdings LLC, an affiliate of Fortress Investment Group, is leading a consortium of lenders intending to provide DIP financing to enable the Company's energy storage business to remain fully operational during the restructuring process. The consortium, or its designee, will also as stalking horse bidder to acquire the Company post-bankruptcy. In addition, the Company will seek to monetize value of its existing automotive business assets. CODA disclosed assets of $10 million to $50 million and liabilities of less than $100 million. The Debtors have incurred prepetition a significant amount of secured indebtedness: secured notes of with principal in the amount of $59.1 million; term loans in the principal amount of $12.6 million; and a bridge loan with $665,000 outstanding. FCO and other bridge loan lenders have "enhanced priority" over other secured noteholders that did not participate in the bridge loans, pursuant to the intercreditor agreement. CODA's legal advisor in connection with the restructuring is White & Case LLP. Emerald Capital Advisors serves as its Chief Restructuring Officer and restructuring advisor, and Houlihan Lokey serves as its investment banker for the restructuring. Sidley Austin LLP is serving as FCO MA CODA Holdings LLC's legal advisor. CODA HOLDINGS: June 3 Auction Scheduled for Note Holders -------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Coda Holdings Inc. will be sold at a June 3 auction to note holders for $25 million unless another buyer emerges with a more lucrative proposal. According to the report, under sale procedures approved May 29 by the bankruptcy court, other bids were due May 31. A hearing to approve the sale is set for June 6. After a blizzard of creditor objections, Coda withdrew a motion for approval of a $425,000 bonus program for 16 top-level executives and managers. The report also relates that on May 29, the bankruptcy court gave final approval for a $4.575 million secured loan to finance the bankruptcy. About CODA Holdings Los Angeles, California-based CODA Energy -- http://www.codaenergy.com-- made an electric auto that was a commercial failure. The company marketed the Coda Sedan, which sold only 100 copies. It was an electrically powered version of the Hafei Saibao, made in China. After bankruptcy, Los Angeles- based Coda intends to concentrate on making stationery electric- storage systems. CODA Holdings, Inc., Coda Energy LLC and three other affiliates filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 13-11153) on May 1, 2013, to enable the Company to complete a sale, confirm a plan, and emerge from bankruptcy in a stronger position to execute its new business plan. The Company expects the sale process to take 45 days to complete. FCO MA CODA Holdings LLC, an affiliate of Fortress Investment Group, is leading a consortium of lenders intending to provide DIP financing to enable the Company's energy storage business to remain fully operational during the restructuring process. The consortium, or its designee, will also as stalking horse bidder to acquire the Company post-bankruptcy. In addition, the Company will seek to monetize value of its existing automotive business assets. CODA disclosed assets of $10 million to $50 million and liabilities of less than $100 million. The Debtors have incurred prepetition a significant amount of secured indebtedness: secured notes of with principal in the amount of $59.1 million; term loans in the principal amount of $12.6 million; and a bridge loan with $665,000 outstanding. FCO and other bridge loan lenders have "enhanced priority" over other secured noteholders that did not participate in the bridge loans, pursuant to the intercreditor agreement. CODA's legal advisor in connection with the restructuring is White & Case LLP. Emerald Capital Advisors serves as its Chief Restructuring Officer and restructuring advisor, and Houlihan Lokey serves as its investment banker for the restructuring. Sidley Austin LLP is serving as FCO MA CODA Holdings LLC's legal advisor. COMMUNITY FIRST: Four Directors Elected to Board ------------------------------------------------ At its annual meeting of shareholders held on May 22, 2013, Community First, Inc.'s shareholders elected Roger Witherow, Bernard Childress, Stephen F. Walker and Martin Maguire to serve as members of the Company's Board of Directors until the Annual Meeting of Shareholders in 2014. The advisory non-binding vote on the compensation of the Company's named executive officers was approved. The shareholders ratified the appointment of Horne LLP as the Company's independent registered public accounting firm for the fiscal year ending Dec. 31, 2013. Because the Company is a participant in the Capital Purchase Program of the United States Treasury Department under the Troubled Assets Relief Program, the Company is required to submit the non-binding, advisory vote on the compensation of the Company's named executive officers to the Company's shareholders every year, and accordingly, the Company did not submit for shareholder approval at the Shareholders Meeting a non-binding, advisory vote on the frequency with which such future non-binding, advisory votes are to be held. At the Company's first shareholders meeting held after the shares of preferred stock issued to the U.S. Treasury pursuant to the CPP have been redeemed, the Company will submit to its shareholders a Say-on- Frequency Proposal. About Community First Columbia, Tennessee-based Community First, Inc., is a registered bank holding company under the Bank Holding Company Act of 1956, as amended, and became so upon the acquisition of all the voting shares of Community First Bank & Trust on Aug. 30, 2002. An application for the bank holding company was approved by the Federal Reserve Bank of Atlanta (the "FRB") on Aug. 6, 2002. The Company was incorporated under the laws of the State of Tennessee as a Tennessee corporation on April 9, 2002. Community First disclosed net income of $3.04 million in 2012, as compared with a net loss of $15.05 million in 2011. The Company's balance sheet at March 31, 2013, showed $501.33 million in total assets, $491.21 million in total liabilities, and $10.11 million in total shareholders' equity. "[T]he Company is subject to a written agreement with its primary regulator, which among other things restricts the payment of interest on subordinated debentures and outstanding preferred stock. The Company is in substantial compliance with this agreement. The Company's bank subsidiary, Community First Bank & Trust (the "Bank"), is not in compliance with a regulatory enforcement action issued by its primary federal regulator requiring, among other things, a minimum Tier 1 Leverage capital ratio of not less than 8.5%. The Bank's Tier 1 Leverage capital ratio was 6.46% at December 31, 2012. Continued failure to comply with the regulatory action may result in additional adverse regulatory action," according to the Company's annual report for the period ended Dec. 31, 2012. COMMUNITY WEST: Shareholders Elect Nine Directors ------------------------------------------------- Community West Bancshares held its 2013 Annual Meeting of Shareholders on May 23 at which nine nominees were elected to the Board of Directors for a one-year term, namely: (1) Robert H. Bartlein; (2) Jean W. Blois; (3) John D. Illgen; (4) Shereef Moharram; (5) Eric Onnen; (6) William R. Peeples; (7) Martin E. Plourd; (8) James R. Sims, Jr.; and (9) Kirk B. Stovesand. The shareholders approved a non-binding advisory vote on compensation of the named executive officers and approved a holding of shareholder advisory vote on executive compensation for the named executive officers every three years. The shareholders also ratified the Company's independent auditors. About Community West Goleta, Calif.-based Community West Bancshares was incorporated in the State of California on Nov. 26, 1996, for the purpose of forming a bank holding company. On Dec. 31, 1997, CWBC acquired a 100% interest in Community West Bank, National Association. Effective that date, shareholders of CWB became shareholders of CWBC in a one-for-one exchange. The acquisition was accounted at historical cost in a manner similar to pooling-of-interests. Community West Bancshares is a bank holding company. CWB is the sole bank subsidiary of CWBC. CWBC provides management and shareholder services to CWB. The Company's balance sheet at March 31, 2013, showed $533.12 million in total assets, $479.05 million in total liabilities and $54.07 million in total stockholders' equity. Consent Agreement On Jan. 26, 2012, the Bank, entered into a consent agreement with the Office of the Comptroller of the Currency, the Bank's primary banking regulator, which requires the Bank to take certain corrective actions to address certain deficiencies in the operations of the Bank, as identified by the OCC. "While the Bank believes that it is in substantial compliance with the OCC Agreement, no assurance can be given that the OCC will concur with the Bank's assessment. Failure to comply with the provisions of the OCC Agreement may subject the Bank to further regulatory action, including but not limited to, being deemed undercapitalized for purposes of the OCC Agreement, and the imposition by the OCC of prompt corrective action measures or civil money penalties which may have a material adverse impact on the Company's financial condition and results of operations." On April 23, 2012, the Company entered into an agreement with the Federal Reserve Bank of San Francisco. Without admitting or denying any alleged charges of unsafe or unsound banking practices and any violations of law, the Company agreed to take corrective actions to address certain alleged violations of law and/or regulation, which included developing and submitting for regulatory approval a cash flow projection of the Company's planned sources and uses of cash for debt service, operating expenses and other purposes. The FRB accepted the cash flow projection on July 10, 2012. In accordance with the FRB Agreement, the Company requested the FRB's approval to pay the dividend due on May 15, 2012, August 15, 2012, November 15, 2012 and February 15, 2013 on the Company's Series A Preferred Stock. Those requests were denied. The Board and Management will continue to work closely with the OCC and FRB to achieve compliance with the terms of both agreements and improve the Company's and Bank's strength, security and performance. COMMUNICATION INTELLIGENCE: Gets $1.5 Million Additional Funding ---------------------------------------------------------------- Communication Intelligence Corporation has secured additional funding from a number of Phoenix Group affiliates and other investors to provide working capital. The financing totaled $1,150,000 in gross proceeds from issuance of Series D Convertible Preferred Stock units. Each unit has a price of $5 and consists of a combination of Series D-1 Convertible Preferred Stock and Series D-2 Convertible Preferred Stock. The transaction closed on May 17, 2013. The shares issued in this private placement were authorized by CIC shareholders at the Company's annual meeting held on Nov. 13, 2012, and the transaction was approved by the Company's Board of Directors as part of CIC's funding plan. "CIC is at a very exciting inflection point and my investment partners and I remain fully committed to securing sufficient funding for the Company to reach profitability," stated Philip Sassower, CIC's Chairman and chief executive officer. "Over the past two years, we have achieved a fantastic improvement in financial performance, and believe that the best is yet to come. CIC continues to add integration partners and the interest in our esignature products and services has never been higher. During 2013, we expect to achieve a growing amount of transaction and recurring revenue and the Company will look to this and additional funding rounds, as may be required, to support operations until such time as CIC becomes self sufficient." About Communication Intelligence Redwood Shores, California-based Communication Intelligence Corporation is a supplier of electronic signature products and the recognized leader in biometric signature verification. In its audit report accompanying the financial statements for 2011, PMB Helin Donovan, LLP, in San Francisco, Calif., expressed substantial doubt about Communication Intelligence's ability to continue as a going concern. The independent auditors noted that of the Company's significant recurring losses and accumulated deficit. The Company reported a net loss of $4.50 million for 2011, compared with a net loss of $4.16 million for 2010. The Company's balance sheet at March 31, 2013, showed $1.98 million in total assets, $1.50 million in total liabilities and $486,000 in total stockholders' equity. CONTOURGLOBAL POWER: Moody's Withdraws 'B2' Ratings --------------------------------------------------- Moody's Investors Service has withdrawn the B2 Corporate Family Rating on ContourGlobal Power Holdings S.A., the B2 senior secured rating on Contour's proposed $350 million term loan and speculative grade liquidity rating of SGL-3. The proposed term loan was never executed as Contour has decided to pursue other financing options. The stable outlook has also been withdrawn. Moody's has withdrawn the rating because it believes it has insufficient or otherwise inadequate information to support the maintenance of the rating. CORMEDIX INC: Obtains Extension of NYSE MKT Listing --------------------------------------------------- CorMedix Inc. on May 31 disclosed that it has received a notice from the NYSE MKT that CorMedix made reasonable demonstration of its ability to regain compliance with Section 1003(a)(i) of the NYSE MKT Company Guide by October 20, 2013. Therefore, during this time, NYSE MKT will continue CorMedix's listing through October 20, 2013. On April 5, 2013, the NYSE MKT notified CorMedix, that it reported stockholders' equity of less than $2 million as of December 31, 2012, and incurred losses from continuing operations and/or net losses in two of its three most recent fiscal years December 31, 2012. As a result, CorMedix again became subject to the procedures and requirements of Section 1009 of the Company Guide. As previously reported, CorMedix had received notice on April 20, 2012 from the NYSE MKT informing it that CorMedix was not in compliance with Section 1003(a)(iv) of the NYSE MKT's continued listing standards due to financial impairment . CorMedix was afforded the opportunity to submit a plan to the NYSE MKT to regain compliance and, on May 17, 2012, presented its plan to the NYSE MKT. On June 27, 2012, the NYSE MKT accepted CorMedix's plan and granted it an extension until August 22, 2012 to regain compliance with the continued listing standards. On September 21, 2012, the NYSE MKT notified CorMedix that it granted CorMedix another extension to January 31, 2013 and on February 1, 2013, NYSE MKT notified that CorMedix was further granted extension until April 15, 2013. On April 18, 2013, a notice was received from NYSE MKT that it granted CorMedix an extension until June 30, 2013 to regain compliance with the continued listing standards of the NYSE MKT. CorMedix remains subject to the conditions set forth in the NYSE MKT's letters dated April 20, 2012, and April 5, 2013. If CorMedix is not in compliance with all of the NYSE MKT's continued listing standards of both Section 1003(a)(i) and Section 1003(a)(iv) within the respective timeframes provided, or does not make progress consistent with either plan or the new plan to be submitted to the NYSE MKT during the respective plan period, the NYSE MKT will initiate delisting proceedings. CorMedix is not eligible for any extension after October 20, 2013. About CorMedix CorMedix Inc. (NYSE MKT:CRMD) -- http://www.cormedix.com-- is a pharmaceutical company that seeks to in-license, develop and commercialize therapeutic products for the prevention and treatment of cardiac and renal dysfunction, also known as cardiorenal disease. CorMedix's most advanced product candidate is CRMD003 (Neutrolin(R)) for the prevention of catheter related bloodstream infections and maintenance of catheter patency in tunneled, cuffed, central venous catheters used for vascular access in hemodialysis patients. CUBIC ENERGY: Shareholders Elect Six Directors ---------------------------------------------- The annual meeting of shareholders of Cubic Energy, Inc., was held on May 22, 2013, at which the Company's shareholders elected six directors to serve until the Company's next annual meeting and until their respective successors have been elected and qualified, namely: (1) Calvin A. Wallen, III; (2) Gene C. Howard; (3) Bob L. Clements; (4) Jon S. Ross; (5) David B. Brown; and (6) Paul R. Ferretti. The shareholders ratified the appointment of Philip Vogel & Co., PC, as the Company's independent registered public accountant for the Company's fiscal year ending June 30, 2013. The shareholders approved, on an advisory basis, named executive officer compensation and voted, on an advisory basis, to hold future advisory votes on named executive officer compensation every year. About Cubic Energy Cubic Energy, Inc., headquartered in Dallas, Tex., is an independent upstream energy company engaged in the development and production of, and exploration for, crude oil and natural gas. Its oil and gas assets and activities are concentrated in Louisiana. Philip Vogel & Co. PC, in Dallas, Texas, issued a "going concern" qualification on the consolidated financial statements for the year ended June 30, 2012. The independent auditors noted that the Company has experienced recurring net losses from operations and has uncertainty regarding its ability to meet its loan obligations which raise substantial doubt about its ability to continue as a going concern. For the nine months ended March 31, 2013, the Company incurred a net loss of $4.39 million on $3.01 million of total revenues, as compared with a net loss of $8.84 million on $5.99 million of total revenues for the same period a year ago. The Company's balance sheet at March 31, 2013, showed $17.24 million in total assets, $28.88 million in total liabilities, all current, and a $11.63 million total stockholders' deficit. Bankruptcy Warning "Our debt to Wells Fargo, with a principal amount of $25,865,110, is due on March 31, 2013, and the Wallen Note, with a principle amount of $2,000,000, is due April 1, 2013, and both are classified as current debt. As of December 31, 2012, we had a working capital deficit of $26,312,271. Our ability to make scheduled payments of the principal of, to pay interest on or to refinance our indebtedness depends on our ability to obtain additional debt and/or equity financing, which is subject to economic and financial factors beyond our control. Our business will not generate cash flow from operations sufficient to pay our obligations to Wells Fargo and under the Wallen Note. We may be required to adopt one or more alternatives, such as selling assets, restructuring debt or obtaining additional equity capital on terms that may be onerous or highly dilutive. Our ability to refinance our indebtedness will depend on the capital markets and our financial condition in the immediate future, as well as the value of our properties. We may not be able to engage in any of these activities or engage in these activities on desirable terms, which could result in a default on our debt and have an adverse effect on the market price of our common stock. "We may not be able to secure additional funds to make the required payments to Wells Fargo. If we are not successful, Wells Fargo may pursue all remedies available to it under the terms of the Credit Facility including but not limited to foreclosure on our assets or force the Company to seek protection under applicable bankruptcy laws. If either of those were to occur, our shareholders might lose their entire investment," the Company said in its quarterly report for the period ended Dec. 31, 2012. "We will continue negotiating with Wells Fargo and Mr. Wallen to either payoff or paydown these debts and extend their respective maturity dates." DALLAS ROADS: Case to be Converted if No Approved Plan by August ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of Texas signed an agreed order that provides that: 1. Dallas Roadster, Limited, et al., will, no later than Aug. 15, 2013, either (1) confirm a plan of reorganization, or (2) convert the cases to Chapter 7; 2. if the Debtors fail to timely comply with the case resolution deadline, then the U.S. Trustee may then upload an order converting the cases to Chapter 7, without any requirement for further notice or hearing; provided, however, the Debtors may obtain an extension of the case resolution deadline for cause on motion filed before the case resolution deadline. William T. Neary, the U.S. Trustee for Region 6, said in a motion seeking dismissal of the case, said that the Debtors' cases are well over a year old. No plan has been confirmed and no disclosure statement has been approved, it pointed out. To resolve the motion, the parties presented to Court the agreed order. About Dallas Roadster and IEDA Enterprises Dallas Roadster, Limited, owns and operates an auto dealership with locations in both Richardson and Plano, Texas. IEDA Enterprises, Inc., is the general partner of Roadster. Dallas Roadster and IEDA Enterprises filed for Chapter 11 bankruptcy (Bankr. E.D. Tex. Case Nos. 11-43725 and 11-43726) on Dec. 12, 2011. Chief Judge Brenda T. Rhoades oversees both cases. J. Bennett White, P.C., replaced DeMarco Mitchell, PLLC, as the Debtors' bankruptcy counsel. Dallas Roadster disclosed $9,407,469 in assets and $4,554,517 in liabilities as of the Chapter 11 filing. The Debtors' assets were placed under the care of a receiver on Nov. 16, 2011, pursuant to a state court action by Texas Capital Bank, National Association. No trustee has been appointed in the Chapter 11 cases. DC DEVELOPMENT: Agrees With BB&T to Escrow Funds ------------------------------------------------ D.C. Development LLC, et al., have filed papers asking the U.S. Bankruptcy Court for the District of Maryland to approve a stipulation with Branch Banking and Trust Company relating to the granting of relief from the automatic stay. The Debtors owe BB&T in excess of $17,000,000 in guaranty obligations, according to papers filed late in April. The stipulation, which was a product of extensive discussions and negotiations, will allow BB&T to set off funds in the club escrow account to reduce the balance owed by $58,719 and to close the account. About Wisp Resort et al. Recreational Industries, Inc., D.C. Development, LLC, Wisp Resort Development, Inc., and The Clubs at Wisp, LLC, operated a ski resort and real estate development companies located in Garrett County, Maryland generally known as Wisp Resort. The Wisp Resort comprises approximately 2,200 acres of master planned and fully entitled land, 32 ski trails covering 132 acres of skiable terrain with 12 lifts and two highly-rated golf courses. Financial problems were caused by a guarantee given to Branch Banking & Trust Co. to secure a $29.6 million judgment the bank obtained on a real estate development within the property. Recreational Industries, D.C. Development, Wisp Resort Development and The Clubs at Wisp filed for Chapter 11 bankruptcy (Bankr. D. Md. Lead Case No. 11-30548) on Oct. 15, 2011, after defaulting on nearly $30 million in loans from BB&T Corp. to build the golf course community. D.C. Development disclosed $91,155,814 in assets and $46,141,245 in liabilities as of the Chapter 111 filing. The Debtors engaged Logan, Yumkas, Vidmar & Sweeney LLC as counsel and tapped Invotex Group as financial restructuring consultant. SSG Capital Advisors, LLC, serves as exclusive investment banker to the Debtors. The Official Committee of Unsecured Creditors has tapped Cole, Schotz, Meisel, Forman & Leonard, P.A. as counsel. In December 2012, the Bankruptcy Court approved the sale of the Wisp resort to EPT Ski Properties, a unit of EPR Properties, for $23.5 million. The judge also approved the sale of a golf course and other land to National Land Partners for $6.1 million. In January 2013, Bankruptcy Judge Wendelin I. Lipp gave his stamp of approval on a stipulation and consent order modifying a previous ruling that allowed D.C. Development to sell a property in McHenry, Maryland, and disburse sales commission. MVB Bank and Logan/Frazee/Yudelevit are counterparties to the stipulation. DC Development sold the 181 Kendall Camp Circle property free and clear of liens, claims, encumbrances and interest, for $485,000. DIGERATI TECHNOLOGIES: Voluntary Chapter 11 Case Summary -------------------------------------------------------- Debtor: Digerati Technologies, Inc. fka ATSI Communications, Inc. aka HD Energy Services, Inc. (Disputed) 12603 Southwest Freeway, Suite 170 Stafford, TX 77477 Bankruptcy Case No.: 13-33264 Chapter 11 Petition Date: May 30, 2013 Court: U.S. Bankruptcy Court Southern District of Texas (Houston) Judge: Jeff Bohm Debtor's Counsel: Edward L. Rothberg, Esq. HOOVER SLOVACEK, LLP 5847 San Felipe, Suite 2200 Houston, TX 77057 Tel: (713) 977-8686 Fax: (713) 977-5395 E-mail: rothberg@hooverslovacek.com Estimated Assets: $50,000,001 to $100,000,000 Estimated Debts: $50,000,001 to $100,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Arthur L. Smith, chief executive officer and director. DTF CORP: June 25 Hearing on Adequacy of Plan Outline ----------------------------------------------------- The Bankruptcy Court continued until June 25, 2013, at 9:30 a.m., the hearing to consider adequacy of the Disclosure Statements explaining the proposed Chapter 11 plans filed by debtor DTF Corporation, and creditor estate of Michael Jordan. As reported by the Troubled Company Reporter on April 9, 2013, the Debtor proposed a Plan that depends entirely on the consummation of a recapitalization transaction involving its parents and its corporation group. The Jordan Estate Plan, according to court papers, was filed to provide a resolution to the Debtor's bankruptcy case even if the proposed recapitalization transaction does not close. Under the Jordan Estate Plan, if the refinancing transactions close and fund as expected, the Parent Company will use a portion of the proceeds of those transactions to fund the Jordan Estate Plan in an amount sufficient to pay all Allowed Claims in full, including the claims filed by Minerva Partners, Ltd.; Walter O'Cheskey, as Trustee of the AHF Liquidating Trust; the Jordan Estate; ViewPoint Bank, NA; Plains Capital Bank, BOKF, N.A. d/b/a Bank of Texas, NA; and all creditors holding Allowed Priority Claims. In the event that the Jordan Estate Plan is not consummated through funding, then the Jordan Estate Plan will be consummated by implementation of the Liquidation Alternative. Under the Liquidation Alternative, the existing equity in the Debtor will be cancelled. The Jordan Estate Plan Liquidation Alternative will not affect rights, if any, of creditors as to International Hospital Management Company, who is obligated on certain of the Debtor's obligations. However, to the extent those creditors receive payments from the Estate, the Estate will be subrogated to related claims against IHMC. Others claims will be satisfied by a sale of the assets of Privado. About DTF Corporation DTF Corporation, f/k/a International Hospital Corporation, filed for Chapter 11 bankruptcy (Bankr. N.D. Tex. Case No. 11-37362) on Nov. 21, 2011. In its schedules, the Debtor disclosed $28,692,980 in assets and $38,947,695 in liabilities. The petition was signed by Gary B. Wood, CEO and director. Judge Stacey G. Jernigan presides the case. John P. Lewis, Jr., Esq., at the Law Office of John P. Lewis, Jr., in Dallas, represents the Debtor as counsel. DUMA ENERGY: To Use New 3D Seismic to Locate Deeper Reserves ------------------------------------------------------------ Duma Energy Corp. has received new 3D seismic data over its producing fields in Galveston Bay. This new data, which covers three of Duma's fields in Galveston Bay, is part of a broader effort by several other large independent oil companies to identify and exploit the deeper potential believed to exist under the bay and surrounding areas. Duma is looking to exploit these deeper zones on its more than 18,000 acres in the bay. This new 3D seismic data will be an integral part of this effort and the Company is already working to have the newly received data analyzed and interpreted by its team. Duma has not, to date, publicly assigned any value to the potential reserves in these deeper horizons, nor do the Company's past engineering reports contemplate any exploration in these deeper intervals. However, with the recent leasing of acreage and seismic acquisition by these other companies, Duma is now focused on identifying these potentially high-pressure, high-volume pay zones. "We have always believed the deep potential was there but decided to focus our efforts on the remaining 'low-hanging fruit' in the prolific Frio intervals at shallower depths," stated Jeremy G. Driver, CEO of Duma Energy Corp. He further commented, "Now that other oil companies have shown a serious and growing interest in the deeper zones and have invested tens of millions of dollars so far, we are further convinced of the potential and the value of our assets." About Duma Energy Corpus Christi, Tex.-based Duma Energy Corp. -- http://www.duma.com/-- formerly Strategic American Oil Corporation, is a growth stage oil and natural gas exploration and production company with operations in Texas, Louisiana, and Illinois. The Company's team of geologists, engineers, and executives leverage 3D seismic data and other proven exploration and production technologies to locate and produce oil and natural gas in new and underexplored areas. Duma Energy incurred a net loss of $4.57 million for the year ended July 31, 2012, compared with a net loss of $10.28 million during the prior fiscal year. The Company's balance sheet at Jan. 31, 2013, showed $26.06 million in total assets, $15.15 million in total liabilities and $10.90 million in total stockholders' equity. DUVALL-WATSON: Court Dismisses Chapter 11 Case ---------------------------------------------- The U.S. Bankruptcy Court approved Duvall-Watson LLC and Somerset Meadows, LLC's motion to dismiss the Debtors' chapter 11 cases in an April 15 order. Duvall-Watson LLC is a real estate development company formed to develop a residential real estate project in Longmont, Colorado. The project, including land owned by Duvall-Watson and Somerset Meadows LLC, contains 18 finished lots and 177 preliminary approved lots in subdivisions known as Somerset Meadows and The Highlands at Somerset Meadows. Duvall-Watson LLC and Somerset Meadows LLC filed for Chapter 11 bankruptcy (Bankr. D. Colo. Case Nos. 11-39586 and 11-39584) on Dec. 27, 2011. Each Debtor estimated $10 million to $50 million in assets and debts. Judge Howard R. Tallman presides over the case. E-DEBIT GLOBAL: To Sell Ownership in Group Link to Screenfin ------------------------------------------------------------ E-Debit Global Corporation has an Agreement of Purchase and Sales Agreement with an Edmonton, Alberta based investment group Screenfin Inc. to purchase 45 percent of the issued and outstanding shares of all classes of Group Link Inc. currently held by E-Debit Global Corporation. "Further to our previous press release dated May 8, 2013, E-Debit having completed its review and due diligence has entered into an Agreement of Purchase and Sales Agreement with an Edmonton, Alberta based investment group Screenfin Inc. to purchase forty- five (45%) percent of all classes of the issued and outstanding shares of Group Link Inc. which are currently held by E-Debit. Terms and conditions of the sale leave E-Debit with a Perpetual Royalty Grant of three and six fourths (3.64%) percent of Group Link Inc. net sales as well as a Perpetual Group Link share position of 10% with Board of Director appointment of a minimum of twenty (20%) percent. Screenfin Inc. is headed by Group Link Inc. President and CEO Adam Ursulak," advises Doug Mac Donald, E- Debit's President and CEO. "While we continue to work strategically to further consolidate our National ATM network our attention will be to capitalize, benefit and expand the reach of our present position within the payments and "non-conventional bank" financial services business not only nationally but internationally. This is the first stage of our financial and operations partnering effort," added Mr. Mac Donald. About E-Debit Global Calgary, Canada-based E-Debit Global Corporation's primary business is the sale and operation of cash vending (ATM) and point of sale (POS) machines in Canada. As reported in the TCR on April 23, 2012, Schumacher & Associates, Inc., in Littleton, Colorado, expressed substantial doubt about E- Debit Global's ability to continue as a going concern, citing the Company's net losses for the years ended Dec. 31, 2012, and 2011, and working capital and stockholders' deficits at Dec. 31, 2012, and 2011. The Company's balance sheet at March 31, 2013, showed US$1.2 million in total assets, US$3.4 million in total liabilities, and a stockholders' deficit of US$2.2 million. EASTMAN KODAK: Judge Pushes Co., Ricoh to Set Patent Dispute Aside ------------------------------------------------------------------ Maria Chutchian of BankruptcyLaw360 reported that a New York bankruptcy judge urged Eastman Kodak Co. and Ricoh Americas Corp. to reach an agreement to temporarily suspend a dispute over eight printer patents until after confirmation of Kodak's reorganization plan. According to the report, at a hearing before U.S. Bankruptcy Judge Allan L. Gropper, attorneys for Kodak asked the judge to stay an adversary proceeding launched in April by Ricoh over the fallen photography icon's alleged prepetition infringement, arguing that the lawsuit violated the automatic stay protecting Chapter 11 debtors. In its complaint, Yokohama, Japan-based Ricoh, maker of printers and scanners, alleges that Kodak printers and associated software infringe a Ricoh patent. Ricoh is demanding a jury trial and seeks an injunction barring Kodak from making and selling products using infringing technology. Ricoh's complaint contains allegations designed so the case can't be heard and decided by the bankruptcy judge in New York. 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. Kodak completed the $527 million sale of digital-imaging technology on Feb. 1, 2013. Kodak intends to reorganize by focusing on the commercial printing business. At the end of April 2013, Kodak filed a proposed reorganization plan offering 85 percent of the stock to holders of the remaining $375 million in second-lien notes. The other 15 percent is for unsecured creditors with $2.7 billion in claims and retirees who have a $635 million claim from the loss of retirement benefits. There will be a hearing on June 13 for the U.S. Bankruptcy Court in New York to consider approving disclosure materials so creditors can begin voting on Kodak's plan. EASTMAN KODAK: GECC Seeks $1.35MM Claim Over Private Jet -------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that although General Electric Capital Corp. already has possession of the private jet previously leased to Eastman Kodak Co., the lender filed papers in bankruptcy court May 30 to take down a $700,000 security deposit in partial recovery of damages for breach of lease. According to the report, Kodak reported a $46.3 million net loss in April. Kodak used a Canadair CL-600-2B16 aircraft until the lease was terminated with bankruptcy court permission in February. GECC took possession in March. GECC says it will still be owed about $1.35 million even after drawing down the security deposit. At a June 20 hearing, GECC will ask the bankruptcy court in New York for permission to draw down the deposit. GECC also wants the court to declare the remaining claim valid for $1.35 million. The report says that depending on the cabin configuration, the aircraft could accommodate as many as 18 passengers. 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. Kodak completed the $527 million sale of digital-imaging technology on Feb. 1, 2013. Kodak intends to reorganize by focusing on the commercial printing business. At the end of April 2013, Kodak filed a proposed reorganization plan offering 85 percent of the stock to holders of the remaining $375 million in second-lien notes. The other 15 percent is for unsecured creditors with $2.7 billion in claims and retirees who have a $635 million claim from the loss of retirement benefits. There will be a hearing on June 13 for the U.S. Bankruptcy Court in New York to consider approving disclosure materials so creditors can begin voting on Kodak's plan. ELBIT IMAGING: Israeli Court Won't Convene Meeting of Creditors --------------------------------------------------------------- The Tel Aviv District Court has decided not to convene the meetings of Elbit Imaging Ltd.'s unsecured creditors and shareholders until the Court receives the written opinion of Roni Alroy, CPA, the Court-appointed expert. Elbit Imaging previously requested that the Court convene meetings of its unsecured creditors and shareholders for the approval of the proposed restructuring of the Company's unsecured financial debt pursuant to a plan of arrangement under Section 350 of the Israeli Companies Law, 5759-1999. The Court also ordered that the Expert should endeavor to provide his opinion, if possible, by June 6, 2013. In addition, the Court ordered that any party that wishes to oppose the Arrangement should file its position as to the Arrangement by May 31, 2013, and that the Company and all other parties to the Arrangement should file their responses thereto by June 16, 2013. About Elbit Imaging Tel-Aviv, Israel-based Elbit Imaging Ltd. (TASE, NASDAQ: EMITF) hold investments in real estate and medical companies. The Company, through its subsidiaries, also develops shopping and entertainment centers in Central Europe and invests in and manages hotels. Brightman Almagor Zohar & Co., in Tel-Aviv, Israel, expressed substantial doubt about Elbit Imaging's ability to continue as a going concern following the financial results for the year ended Dec. 31, 2012. The Certified Public Accountants noted that in the period commencing Feb. 1, 2013, through Feb. 1, 2014, the Company is to repay its debenture holders NIS 599 million (principal and interest). "Said amount includes NIS 82 million originally payable on Feb. 21, 2013, that its repayment was suspended following a resolution of the Company's Board of Directors. The Company's Board also resolved to suspend any interest payments relating to all the Company's debentures. In addition, as of Dec. 31, 2012, the Company failed to comply with certain financial covenants relating to bank loans in the total amount as of such date of NIS 290 million. "These matters raise substantial doubt about the Company's ability to continue as a going concern." Elbit Imaging disclosed a loss of NIS455.50 million on NIS671.08 million of total revenues for the year ended Dec. 31, 2012, as compared with a loss of NIS247.02 million on NIS586.90 million of total revenues for the year ended Dec. 31, 2011. The Company's balance sheet at Dec. 31, 2012, showed NIS7.09 billion in total assets, NIS5.67 billion in total liabilities, NIS309.60 million in equity to holders of the Company and NIS1.11 billion in noncontrolling interest. ELEPHANT TALK: Significant Losses Prompts Non-Compliance Notice --------------------------------------------------------------- Elephant Talk Communications Corp. has received a non-compliance notice from the NYSE MKT, in that the Company has sustained losses which are so substantial in relation to its overall operations, or its existing financial resources, or its financial condition has become so impaired that it appears questionable, in the opinion of the NYSE MKT, as to whether it will be able to continue operations or meet its obligations as they mature. In order to maintain its listing, the Company must submit a specific plan of compliance by May 31, 2013, addressing how it intends to regain compliance with Section 1003(a)(iv) of the Company Guide by June 30, 2013. If the Plan is accepted, the Company may be able to continue its listing during the Plan Period, but will be subject to continued periodic review by the NYSE MKT. If the Company does not submit a Plan by May 31, 2013, or the Plan is not accepted by the NYSE MKT, it will be subject to delisting proceedings. Furthermore, if the Plan is accepted but the Company is not in compliance with the continued listing standards by June 30, 2013, or if the Company does not make progress consistent with the Plan during the Plan Period, the NYSE MKT will initiate delisting proceedings, as appropriate. The NYSE MKT's notice has no immediate effect on the listing of the Company's common stock on the NYSE MKT. The Company is taking immediate action in response to this notice in order to regain compliance with the continued listing requirements and will submit the Plan on or before May 31, 2013. "We anticipated receiving this notice and are in continuing discussions with the NYSE MKT regarding the steps necessary to regain compliance," said Steven van der Velden, Chief Executive Officer of the Company. "We strongly believe we have options available and will take the appropriate steps to secure additional capital and regain compliance." About Elephant Talk Lutz, Fla.-based Elephant Talk Communications, Inc. (OTC BB: ETAK) -- http://www.elephanttalk.com/-- is an international provider of business software and services to the telecommunications and financial services industry. Elephant Talk disclosed a net loss attributable to the Company of $23.13 million in 2012, a net loss attributable to the Company of $25.31 million in 2011 and a net loss attributable to the Company of $92.48 million in 2010. The Company's balance sheet at March 31, 2013, showed $34.47 million in total assets, $18.29 million in total liabilities, and $16.18 million in total stockholders' equity. BDO USA, LLP, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012. The independent auditors noted that the Company has suffered recurring losses from operations has an accumulated deficit of $203.3 million and continues to generate negative cash flows that raise substantial doubt about its ability to continue as a going concern. EXPERA SPECIALTY: Moody's Assigns 'Caa1' Rating to $178MM Loan -------------------------------------------------------------- Moody's assigned first-time ratings to Expera Specialty Solutions, including a B3 corporate family rating, B3-PD probability of default rating, and a Caa1 rating to $178 million senior secured term loan. Moody's also assigned Speculative Grade Liquidity (SGL) rating of SGL-3. The outlook is positive. Ratings Rationale: The ratings reflect Expera's relatively small size and scale, concentration in specialty paper products, with geographically concentrated asset base, limited vertical integration and exposure to volatile commodity pricing. Although Moody's believes that the company will have relatively strong leverage and interest coverage metrics if integration is executed successfully, the ratings are constrained by lack of stand-alone operating history of the company in its current configuration. The ratings also reflect the company's environmental exposures and related capital investment requirements going forward. The positive outlook reflects Moody's expectations of improved debt protection metrics and financial performance upon the realization of substantial synergies. Although uncertainties over the resilience of the company's business model as a stand-alone enterprise constrain the ratings, an upgrade would be considered if the performance of the combined enterprise proves to be consistent with Moody's expectations. The newly formed company will become a major manufacturer of paper-based protective packaging products for the industrial, food, and pressure-sensitive release liner segments. The company produces a diverse range of specialty grades that are custom- engineered to protect end users' products. Representative applications include construction insulation facing, automotive masking tapes, glass and metal interleaver, food wraps, baking papers, microwave popcorn packaging, medical garments, and specialty release liners. In April 2013, KPS Capital Partners ("KPS") formed Expera to acquire Wausau Paper Corporation's ("Wausau") technical and specialty paper business and Thilmany Papers ("Thilmany"), the technical and specialty paper division of Packaging Dynamics Corporation. The combined company will not have any defined benefit or other postretirement benefit obligations. The company's mills include Mosinee paper and pulp mill, Rhinelander paper mill, Kaukauna paper and pulp mill, and De Pere paper mill -- all in the state of Wisconsin. The mills combined operate 16 paper machines with total capacity of 592K tons. KPS is a family of private equity funds with over $6.0 billion of assets under management. KPS Portfolio Companies, as of December 31, 2012, have aggregate annual revenues of approximately $6.8 billion, operate 85 manufacturing plants in 25 countries, and employ over 29,000 associates, directly and through joint ventures worldwide. Moody's expects that Expera will be able to realize significant synergies and that its combined metrics will be meaningfully stronger than those reported by the acquired businesses as part of larger organizations. Moody's anticipates substantially leaner administrative costs (as compared to historical corporate allocations), as well as savings in procurement and machine optimization. Over the next twelve to eighteen months, Moody's expects the company to generate annual revenues of approximately $760 million, EBITDA margin to range between 6% and 8%, Debt/ EBITDA, as adjusted to be range from 3.7x to 3.9x, and EBITDA/ Interest to range from 4.0x to 4.5x. That said, one of the key factors constraining the ratings is that many of company's competitors have larger scale, more product diversity, and have greater financial resources. Many have entered, and continue to enter, the specialty paper business to increase utilization of paper machines that would otherwise be idle. Accordingly, Moody's expects that some of the company's markets may become oversupplied, and that its larger competitors may be better positioned to weather these industry conditions due to their diversification in other products, greater vertical integration, or both. Demand for company's products is also affected by general economic conditions as well as product-use trends. Although Expera is focused on higher value-added specialty grades of paper, and supplies a diverse mix of customers, the competitiveness of the company's markets could cause demand and pricing for company's products to fluctuate, and could affect the company's ability to compete and generate consistent cash flows during industry downturns. Expera has strong, long standing business relationships with a diversified base of customers, while its products are designed to meet specific customers' manufacturing and end product requirements. Nevertheless, only 40% of the company's production is secured under contracts, while the company's products generally represent a small portion of the customers' manufacturing process -- further exposing the company to fluctuations in demand and competition from other suppliers. Wood pulp is the principal raw material used in the company's manufacturing process. The cost and availability of wood and pulp historically experienced great fluctuations due to weather, economic conditions, international demand, particularly in China, and worldwide supply additions or disruptions. While the company's pulp mills supply 45% of internal needs, and the company has generally shown ability to pass through raw material cost increases to its customers, the financial performance of company's businesses has historically fluctuated with commodity pricing. Energy, including coal, diesel fuel, electricity and natural gas, represents a significant portion of the company's manufacturing costs. The company is only about 45% self sufficient in energy, and as such, is exposed to the risk of energy cost increases. The company is subject to extensive regulation by various federal, state, and local agencies with respect to environmental compliance, which could impact the company's operating costs and capital investments going forward. For example, the new maximum achievable control technology ("MACT") rules published by the United States Environmental Protection Agency are expected to require compliance with stricter air emission limits for industrial boilers by March 21, 2014. The proposed rules are applicable to the coal fired boilers at two of the company's paper mills, and will require substantive capital investment ranging between $12 and $21 million. The proposed capital structure will include $75 million ABL revolver, which will have first lien on the company's accounts receivable and inventory, and $178 million senior secured term loan which will have first priority lien on substantially all remaining assets of the company. The Caa1 rating on the term loan reflects lack of unsecured debt in the company's capital structure, as well as superior position of the ABL revolver with respect to collateral package. Speculative Grade Liquidity score of SGL-3 reflects Moody's expectation that the company will have adequate liquidity over the next twelve months, but that it may utilize ABL borrowings to finance capital investments. Pro-forma for the proposed transaction, the company will have no cash balances and will have $70 million availability under the ABL revolver. The ratings could be upgraded if integration is executed successfully and expected synergies are realized, if EBITDA margins were expected to increase above 9%, the company was expected to generate meaningful free cash flow on a consistent basis, and Debt/ EBITDA was sustained below 4x. The ratings could be downgraded if liquidity deteriorates, if Debt/ EBITDA were to increase above 6x, if EBITDA margins were expected to fall below 2.5%, or if free cash flow was expected to be persistently negative. The principal methodology used in this rating was the Global Paper and Forest Products Industry Methodology published in September 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. FEDERAL-MOGUL CORP: Moody's Keeps CFR over $500MM Rights Offering ----------------------------------------------------------------- The announcement by Federal-Mogul Corporation that it intends to launch a $500 million registered rights offering has no impact on the company's B2 Corporate Family Rating. Moody's anticipates that any additional debt reduction resulting from the rights offering and continued operational improvement should better position Federal-Mogul within the assigned Corporate Family Rating. The last rating action for Federal-Mogul Corporation was on October 25, 2012 when the Corporate Family Rating was lowered to B2 with a stable rating outlook. The principal methodology used in this rating 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. Federal-Mogul Corporation, headquartered in Southfield, MI is a leading global supplier of products and services to the world's manufacturers and servicers of vehicles and equipment in the automotive, light, medium and heavy-duty commercial, marine, rail, aerospace, power generation and industrial markets. The company's products and services enable improved fuel economy, reduced emissions and enhanced vehicle safety. Revenues in 2012 were $6.7 billion. FIRST BALDWIN: Home Bancshares' Contribution Claim Rejected ----------------------------------------------------------- Bankruptcy Judge Margaret A. Mahoney denied Home Bancshares, Inc., Application for Substantial Contribution Claim pursuant to 11 U.S.C. Sec. 503(b)(3)(D) in the Chapter 11 case of First Baldwin Bancshares, Inc. Alesco Preferred Funding XV, Ltd., through its collateral manager, ATP Management LLC, objected to the claim. The debtor, the Bankruptcy Administrator, and a creditor, Rodney A. Pilot, supported the objection. Home Bancshares' claim to equity security holder status is linked to its purchase of 35 shares of common stock of the debtor on or after April 11, 2013. It was an equity security holder at the time of the confirmation hearing in the case, but not at the time the case was filed or the Plan and Disclosure Statement were filed or the sale of the debtor to The First Bancshares, Inc. was negotiated. All of the fees of Home Bancshares' attorneys and consultant shown in Home Bancshares affidavit are prepetition fees and expenses except for 4.7 hours of the consultant's time. According to the affidavit of Home Bancshares CEO, the only fees and expenses claimed to be a substantial contribution by Home Bancshares are those incurred prepetition. According to Judge Mahoney, when a creditor or equity security holder incurs fees and expenses prepetition, the creditor does so at its own risk. A copy of the Court's May 30, 2013 Order is available at http://is.gd/CwWtDJfrom Leagle.com. Brian G. Rich, Esq. -- BRich@bergersingerman.com -- at Berger Singerman, LLP, in Tallahassee, Florida, argues for Home Bancshares, Inc. Michael G. Wilson, Esq. -- mwilson@hunton.com -- at Hunton & Williams, LLP; and Douglas S. Draper, Esq. -- ddraper@hellerdraper.com -- at Heller, Draper, Patrick & Horn, LLC, represent Alesco Preferred Funding XV, Ltd. Kenneth A. Watson, Esq. -- kwatson@joneswalker.com -- at Jones Walker, represent the Debtor. Lawrence B. Voit, Esq. -- lvoit@silvervoit.com -- at Silver, Voit & Thompson, P.C., argues for Rodney A. Pilot. First Baldwin Bancshares, Inc., filed a Chapter 11 petition (Bankr. S.D. Ala. Case No. 13-00563) on Feb. 21, 2013, listing under $1 million in both assets and debts. A copy of the petition is available at http://bankrupt.com/misc/alsb13-00563.pdf FOREST OIL: Weak Finances Prompt Moody's to Lower CFR to 'B2' ------------------------------------------------------------- Moody's Investors Service downgraded Forest Oil Corporation's Corporate Family Rating (CFR) to B2 from B1, its Probability of Default Rating (PDR) to B2-PD from B1-PD, and its senior unsecured notes rating to B3 from B2. The speculative grade liquidity rating of SGL-3 was affirmed. The outlook is negative. "The downgrade and negative outlook reflect continuing weakness in Forest Oil's credit metrics despite its efforts to reduce debt through asset sales," commented Andrew Brooks, Moody's Vice President. "While Forest has achieved a reduction in its level of outstanding debt, the lost production and reserves associated with divested properties has caused relative leverage measures to increase in addition to shrinking the overall size and scope of its E&P operations, tasking a narrower asset base with reducing leverage." Ratings downgraded: Corporate Family Rating, downgraded to B2 from B1 Probability of Default Rating, downgraded to B2-PD from B1-PD Senior Unsecured Notes Rating, downgraded to B3 from B2 Ratings Rationale: Forest's B2 CFR reflects its weak leverage metrics and narrow cash operating margins, notwithstanding the size and scale of its E&P operations, which while much reduced over the past four years, remains large compared to its B2 rated peers. Forest remains exposed to weak natural gas prices as evidenced by the 66% of 2013's first quarter production which was natural gas (another 19% is natural gas liquids -- NGLs, which are enduring their own price weakness). In an effort to address its over-levered balance sheet, Forest has embarked on a program of asset sales, deploying asset sale proceeds into debt reduction. This program has been moderately successful in that debt has been reduced by $460 million since 2012's third quarter. However, while asset sales were initially directed at non-core, non-producing properties, the sale of certain producing properties served to continue Forest's four-year downward trajectory in proved reserves and average daily production, which over that time period have declined 49% and 36%, respectively. Forest's first quarter 2013 production averaged 41 thousand barrels of oil equivalent (Boe) per day. As a result, while debt levels have been reduced, that decline has been exceeded by the production declines, prompting relative leverage measures to climb. At March 31, debt exceeded $41,000 per Boe of first quarter average daily production while Moody's estimates debt on the company's pro forma (South Texas asset sale) year-end 2012 proved developed reserves was around $13 per Boe, both measures weak for its B2 rating. On a more positive note, on April 12, Forest announced a joint venture with Schlumberger Production Management (Schlumberger, A1 stable) enabling it to accelerate development of 55,000 acres Forest holds in the Eagle Ford Shale (27,500 net acres to Forest). Schlumberger will pay a $90 million drilling carry (no upfront payment) to earn a 50% working interest in this acreage. The drilling carry will help fund Forest's 2013 capital spending program, the acceleration of which is expected to more than double its Eagle Ford production volumes to 6,500 Boe per day in 2014, adding an element of further growth to the compamy's crude oil production from the 15% contribution registered in 2013's first quarter. Forest anticipates increasing oil production from 15% in 2013's first quarter to over 30% by the end of 2014. It is through the repositioning and growth of oil producing assets that Forest plans to address the extent of its relative debt leverage, however, Moody's would not expect meaningful de-leveraging until 2015. Forest's SGL-3 Speculative Grade Liquidity rating reflects Moody's expectation of adequate liquidity through mid-2014. Moody's expects Forest's capital budget of $355-$375 million to result in a cash flow deficit approximating $100 million in 2013, which would likely be funded by borrowings under its secured borrowing base revolving credit, supplemented by residual proceeds from any further asset sales. At March 31, Forest had $140 million of outstanding borrowings under its $900 million borrowing base, leaving $758 million net availability. However, the revolver includes a leverage covenant limiting debt/EBITDA to 4.5x, and with March 31 compliance at 4.3x, access to the revolver would be restricted to an incremental $75 million. The revolver is secured by a mortgage and security interest in Forest's proved oil and gas properties and related assets. With total debt at December 31 in excess of PV-10, Moody's views Forest's alternate sources of liquidity as weak. The negative outlook reflects Moody's view that Forest's debt leverage may not appreciably decline from elevated levels, as well as continuing margin pressure as a result of the company's exposure to weak natural gas and NGL prices, notwithstanding its focus on growing its oil production in the Eagle Ford. If Forest generates cash margin improvement through its focus on greater crude oil production or if additional asset sales generate proceeds for debt reduction, the outlook could be stabilized. A downgrade could be considered if Forest fails to execute on its development program in the Eagle Ford, should debt on production deteriorate beyond $45,000 per Boe or should its leveraged full cycle fail to approach 1x by mid-2014. An upgrade would be considered if Forest reduced debt to average daily production below $30,000, together with achieving improved cash flow metrics including retained cash flow to debt over 20% and EBITDA/interest exceeding 4x. The B3 rating on the senior unsecured notes reflects both the overall probability of default of Forest, to which Moody's assigns a PDR of B2-PD, and a loss given default of LGD4 (68%). Forest's senior unsecured notes are subordinate to it $900 million secured revolving credit facility's priority claim to the company's assets. The size of the claims relative to Forest's outstanding senior unsecured notes results in the notes being rated one-notch below the B2 CFR under Moody's Loss Given Default Methodology. The principal methodology used in rating Forest Oil Corporation 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. Forest Oil Corporation is an independent exploration and production company headquartered in Denver, Colorado. FRIENDSHIP VILLAGE: Fitch Affirms 'BB-' Rating on Revenue Bonds --------------------------------------------------------------- Fitch Ratings has affirmed the 'BB-' rating on the following Illinois Finance Authority revenue bonds issued on behalf of Friendship Village of Schaumburg Obligated Group (FVS): -- $70.2 million series 2005A; -- $5 million series 2005B; -- $33.6 million series 2010. The Rating Outlook is revised to Negative from Stable. SECURITY The bonds are supported by a pledge of gross revenues, a mortgage interest in property and improvements, and debt service reserves. Key Rating Drivers WEAKER-THAN-EXPECTED OCCUPANCY: The Outlook revision to Negative reflects FVS's ongoing struggle with occupancy in unaudited fiscal 2013 (year ended March 31). Resident attrition and real estate market challenges resulted in lower-than-budgeted independent living unit (ILU) occupancy. At the March 31 year-end in 2013, FVS's ILUs were 71.9% occupied, and had averaged 73.7% occupancy through the fiscal year. DEBT SERVICE COVERAGE DECLINED: ILU sales and turnover challenges produced $4.2 million in net entrance fees, below the $5.4 million budgeted for 2013. As a result, maximum annual debt service (MADS) coverage fell to a light 1.1x (as Fitch calculates) from 1.3x in 2012. Per its master indenture calculation, FVS produced 1.34x rolling 12-month coverage, down slightly from the 1.4x produced for the same prior year period. LIQUIDITY REMAINS SUFFICIENT: FVS's liquidity metrics are commensurate with its 'BB' category rating. At March 31, 2013, FVS had $27.2 million in unrestricted cash and investments, equating to 229.2 days of cash on hand, a 3.3x cushion ratio and cash to debt of 25.3%. Still, liquidity metrics are down slightly from the prior year. SIGNIFICANT LEVERAGE: FVS's debt burden remains high, as indicated by MADS equal to a high 18.1% of fiscal 2013 revenues and debt to net available of 12.1x. Further, revenue-only coverage declined to 0.6x as Fitch calculates, down from 0.7x in the prior year. Still, no further debt is planned and future capital expenditures will be funded as cash flow allows. Rating Sensitivities STABILIZED OPERATIONS: If FVS fails to stabilize occupancy via healthy ILU sales and turnover entrance fee receipts which improve occupancy and debt service coverage in fiscal 2014, negative rating action is possible. Credit Profile The Outlook revision to Negative from Stable is supported by weaker-than-expected occupancy and coverage metrics in unaudited fiscal 2013, which has been exacerbated by ongoing challenges in the local real estate environment and higher than historical turnover. Total sales in fiscal 2013 dropped slightly, to $11.2 million in turnover entrance fees from $12.5 million in fiscal 2012. Total move-ins of 84 against attrition of 111 during fiscal 2013 effectively reduced the net impact from unit sales. Fitch believes FVS will be challenged to meet its fiscal 2014 budget of $18 million in turnover entrance fees and $6.8 million in net entrance fees. Still, FVS has been aggressive with expanding its sales team and marketing initiatives, as well as addressing attrition with wellness and chronic disease programs. It met its 14 sales budget for April, and there are signs of a stabilizing housing market in and around Schaumburg. Through March 31, 2013, FVS produced a 16.6% adjusted net operating margin, which was down from 21.8% in the prior year and slightly below budgeted expectations. FVS's liquidity remains sufficient for the rating level, and its debt burden, though high, should moderate over the longer term. Total debt equaled $107.8 million at March 31, 2013, including $5 million in series 2005B extendable-rate adjustable securities (EXTRAS). While the rate on these bonds will reset in February 2014, their structure prevents demands on liquidity as there is not a put option. No additional debt is planned, and FVS's 2014 capital budget near $6 million will be flexed in conjunction with financial performance. FVS's parent entity Friendship Senior Options (FSO) developed a start-up continuing care retirement community, Greenfields of Geneva (Greenfields), which opened in 2012. Greenfields is a non- obligated group affiliate and there are restrictions under FVS's bond documents on the amounts that can be transferred out of FVS. Other than a transfer of $2 million in fiscal 2010 to FSO, no other transfers have occurred since then. Fitch does not expect any additional transfers, which would place negative rating pressure on FVS given its current weak financial profile. Friendship Village of Schaumburg is a Type B continuing care retirement community (CCRC) currently consisting of 622 independent living apartments, 28 independent living cottages, 81 assisted living units, 25 assisted living dementia units, and 248 skilled nursing beds. The facility is located in Schaumburg, IL, approximately 30 miles northwest of downtown Chicago. In unaudited fiscal 2013 ended March 31, FVS had total revenues of $44.4 million. Under its Continuing Disclosure Agreement, FVS' is required to provide annual audited financial statements within 150 days of each fiscal year's end and quarterly unaudited financial statements within 45 days of each fiscal quarter-end. Disclosure to Fitch has been excellent and includes regularly scheduled investor calls. GENERAL MOTORS: Rapp Chevrolet Barred From Using GM Trademark ------------------------------------------------------------- Rapp Chevrolet, Inc., a former dealership of General Motors, LLC, has been enjoined from using the GM trademark in a South Dakota district court order available at http://is.gd/OgsE5Jfrom Leagle.com. The decision was issued by District Judge Roberto A. Lange on May 21, 2013, in the trademark infringement lawsuit GM commenced against Rapp (Case No. CIV 12-4209-RAL, D.S.D.). Rapp was among the 60 GM dealerships that refused to sign a wind- down agreement under Old GM's bankruptcy proceedings. Old GM, with the consent from the bankruptcy court, rejected its dealer agreement with these dealerships effective July 2009. The bankruptcy court also stated in its rejection order that each "affected dealer" were no longer authorized to use the GM trademark, including the Chevrolet marks. The District Court took into consideration GM's complaints that Rapp continued to use the Chevrolet trademark in business dealings even after the dealer agreement between them was terminated. In his May 21 opinion, Judge Lange concluded that GM succeeded on the merits of its claims of (1)trademark and service mark infringement, (2) dilution of GM trademark, and (3) breach of dealer agreement on the restrictive use of GM trademarks, against Rapp. Partial summary judgment is entered in favor of GM on these claims, the judge ruled. Accordingly, Judge Lange also permanently enjoined Rapp, its officers, and agents from making any unauthorized use of the GM Marks. Rapp is also directed to discontinue use of any internet advertising, website or Facebook page using "Rapp Chevrolet" as its name or website. To the extent however that GM seeks summary judgment on any monetary or attorney fee claim, partial summary judgment is denied at this time on those claims. GM's request for a stay of discovery is also denied. About General Motors With its global headquarters in Detroit, Michigan, General Motors Company (NYSE:GM, TSX: GMM) -- http://www.gm.com/-- is one of the world's largest automakers, traces its roots back to 1908. GM employs 208,000 people in every major region of the world and does business in more than 120 countries. GM and its strategic partners produce cars and trucks in 30 countries, and sell and service these vehicles through the following brands: Baojun, Buick, Cadillac, Chevrolet, GMC, Daewoo, Holden, Isuzu, Jiefang, Opel, Vauxhall, and Wuling. GM's largest national market is China, followed by the United States, Brazil, the United Kingdom, Germany, Canada, and Italy. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. General Motors Co. was formed to acquire the operations of General Motors Corp. through a sale under 11 U.S.C. Sec. 363 following Old GM's bankruptcy filing. The U.S. government once owned as much as 60.8% stake in New GM on account of the financing it provided to the bankrupt entity. The deal was closed July 10, 2009, and Old GM changed its name to Motors Liquidation Co. General Motors Corp. and three of its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on June 1, 2009. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Garden City Group is the claims and notice agent of the Debtors. The U.S. Trustee appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP served as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long served as counsel on supplier contract matters. FTI Consulting Inc. served as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represented the Asbestos Committee. Legal Analysis Systems, Inc., served as asbestos valuation analyst. The Bankruptcy Court entered an order confirming the Debtors' Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan was declared effect on March 31, 2011. GLIMCHER REALTY: S&P Raises Corp. Credit Rating to 'BB-' -------------------------------------------------------- Standard & Poor's Ratings Services said it raised its corporate credit rating on Glimcher Realty Trust to 'BB-' from 'B+'. The outlook is stable. S&P also raised the preferred stock rating to 'B-' from 'CCC+'. "The upgrade reflects our expectation that fixed-charge coverage will improve more than we previously expected because of cash flow growth from the same-store portfolio, acquisitions, the increasing contribution from Scottsdale Quarter, and redevelopment," said Standard & Poor's credit analyst George Skoufis. It also reflects the company's attractive refinancings (including the repayment/refinancing of high-cost preferred stock) and its issuance of common equity to partly fund investments, which supports fixed charge coverage (FCC) improvement to the high 1x area, as well as modestly lower debt to EBITDA. S&P also acknowledges the growth and enhanced quality of the portfolio. The stable outlook reflects S&P's view that Glimcher's well- occupied portfolio should continue to generate modest cash flow growth, which along with manageable debt maturities supports S&P's expectation for improving credit metrics over the next 12-24 months. Ratings improvement over the near term is limited due to the small size of the portfolio. Longer term, S&P would consider an upgrade if Glimcher can continue to improve the quality of the portfolio and grow and diversify the asset base. S&P would also expect the company to continue to strengthen credit metrics such that FCC remains above 1.7x and debt to EBITDA declines to the 8x- 9x range. S&P sees limited downside to the rating currently, but would lower the rating if FCC declined below 1.5x and/or internal cash flow was not sufficient to cover the dividend. GOODMAN NETWORKS: Moody's Cuts CFR to B3 Following Debt Increase ---------------------------------------------------------------- Moody's Investors Service downgraded Goodman Networks, Inc.'s Corporate Family Rating to B3, Probability of Default to B3-PD and senior secured debt ratings to B3, and revised the outlook to stable from negative. This action follows the company's announcement that it plans to issue $100 million of add-on notes to the $225 million 12.125% senior secured notes due 2018 that were privately placed in July 2011. The proposed add-on notes, which were assigned a B3 rating, will rank pari passu with the existing notes and have identical terms (including the same subsidiary guarantees and collateral package). However, it will also incorporate an amendment that: (i) permits Goodman to issue and secure incremental senior secured debt; (ii) relaxes the fixed charge coverage debt incurrence test; and (iii) modifies the definition of EBITDA to allow the add-back of certain one-time non-recurring expenses. Net proceeds from the offering together with cash balances will be used to fund the acquisition of Multiband Corporation ("Multiband") for roughly $116 million, expected to close in the third quarter of 2013, subject to regulatory and shareholder approvals. Multiband provides contract installation services to satellite and broadband cable providers, Internet service providers (ISPs) and commercial customers, as well as voice, data and video billing services to residents of multi-dwelling units (MDU). Goodman plans to leverage Multiband's national footprint infrastructure (i.e., technician workforce, vehicle fleet and services organization) to expand its product offering, diversify the customer base, and exploit growth opportunities in small cell technology. In February 2013, Goodman strengthened its small cell solutions capabilities when it paid $18 million to acquire Custom Solutions Group ("CSG"), a division of Cellular Specialties, Inc., which provides indoor and outdoor wireless distributed antenna systems (DAS) and Wi-Fi solutions. Ratings Downgraded: Corporate Family Rating to B3 from B2 Probability of Default Rating to B3-PD from B2-PD $225 Million 12.125% Senior Secured Notes due 2018 to B3 (LGD-4, 54%) from B2 (LGD-4, 57%) Rating Assigned: $100 Million 12.125% Senior Secured Notes Add-on due 2018 -- B3 (LGD-4, 54%) The assigned rating is subject to review of final documentation and no material change in the terms and conditions of the transaction as advised to Moody's. Ratings Rationale: The rating revision reflects Moody's expectation that Goodman's financial leverage will be sustained above its 4.5x downgrade trigger over the rating horizon. This will be driven by the disproportionate amount of incremental debt relative to additional EBITDA from the Multiband purchase. Moody's expects total debt to EBITDA (Moody's adjusted, excluding certain one-time non-recurring expenses and including a half-year of Multiband's EBITDA) will increase to the 7.5x area by year end 2013 (compared to 5.8x as of December 2012) and decline to 5x by the end of 2014, when a full year of Multiband's EBITDA would be reported in Goodman's financial results. Moody's also projects negative free cash flow this year due to the timing of increased working capital commitments paid in advance of customer receipts. Further, Multiband's relatively low margins will compress Goodman's already low EBITDA margins (6% to 8% range). Moody's expectation does incorporate future improvement in Multiband's EBITDA as Goodman integrates certain loss-making Multiband businesses, thus eliminating redundant expenses and achieving around $3 million in cost savings. Moody's also considers the gradual improvement in overall margins over the medium-term as the higher margin small cell business becomes a contributor to revenue. Nonetheless, the downgrade embeds Moody's view that Goodman will face challenges to scale, integrate and overlay CSG's enterprise wireless business and Goodman's network design capabilities onto Multiband's installation and services platform to create a viable small cell provider. Multiband's largest customer, DIRECTV, represents approximately 86% of its revenue, while Goodman's largest customer, AT&T, accounts for about 87% of its revenue. Though the combined company will have somewhat better customer diversity, the B3 CFR considers the still meaningful revenue concentration given that two customers will represent almost 90% of revenue. Notably, DIRECTV's US operations continue to experience slowing net subscriber additions, which Moody's believes negatively impacted Multiband's Field Services installations in 2012 and led to weaker operating performance. The industry's slowing subscriber growth trend continued into this year's first quarter (typically a seasonally strong quarter) as pay TV operators experienced a lower rate of additions. Given the satellite TV industry's sluggish growth profile, Moody's believes Goodman's earnings could experience greater volatility going forward. Goodman's B3 CFR considers the relatively high business risks associated with the small scale and low margins of its outsourced engineering and infrastructure operations that serve primarily large communications and technology companies in the US. The rating also reflects Goodman's significant customer concentration, key-man and project execution risks, and exposure to the capital expenditure cycles of its two largest customers, which are represented largely by AT&T (55% of pro forma combined revenue) and DIRECTV (32% pro forma), and the resulting unevenness in free cash flow generation. In addition, as outsourcing of services represents an integral component of the company's revenue base, Goodman's value proposition needs to be a more cost effective alternative than its larger and better capitalized customers can perform in-house. Moody's notes that delays in new contract wins and a slowdown in carriers' capital spending could also elevate leverage in the future, which further constrains the rating. These risks are offset by Goodman's recent contract wins from other carriers such as Sprint, Windstream, US Cellular, CenturyLink and Clearwire, which will enable the combined company to diversify its revenue away from AT&T and DIRECTV. Nonetheless, Moody's expects Goodman will benefit over the medium term from AT&T's plans to invest an additional $8 billion to expand its LTE network coverage to 300 million POPs (points of presence) by year- end 2014 and to build out a highly dense network by deploying more than 40,000 small cells and over 1,000 DAS. Since AT&T is increasingly reliant on Goodman's technical expertise to improve its network and Goodman is one of AT&T's largest vendors, this is a growth opportunity that allows the company to participate in its largest customer's network expansion. However, this also requires successful execution of the nascent small cell strategy. Moody's notes that Goodman's B3 CFR also embeds the inadequate systems, internal controls and oversight related to the company's historical misapplication of percentage of completion revenue recognition and the resulting impact on financial reporting accuracy, which increases accounting risk. While the recent financial restatements did not materially impact the company's financial position or cash flows, Moody's confidence in the company's financial reporting has weakened since the initial rating assignment. The rating reflects Goodman's efforts to remediate material weaknesses (in addition to ongoing remediation work related to an unresolved material weakness) and higher costs associated with the review, audit work and modification of accounting and IT systems. It also reflects the risk that senior management could be distracted from effective operation of the business as management's bandwidth will be stretched during the integration of Multiband and CSG at a time when Goodman is still upgrading its internal controls and processes, which are not yet completely entrenched in the company's operations. Moody's expects Goodman to maintain adequate liquidity over the next twelve months characterized by significant working capital swings, cash balances below historical levels, and negative free cash flow generation. However, given Goodman's sufficient cash levels, Moody's does not believe the company will need to draw under its $50 million ABL facility. Rating Outlook The stable rating outlook reflects Moody's view that Goodman will maintain a solid contractual backlog, customer relationships will remain relatively steady, EBITDA margins will be in the 5% to 7% range and the company will return to positive free cash flow generation in 2014. What Could Change the Rating -- Up Ratings could be upgraded to the extent the combined company is able to profitably increase and diversify its business away from AT&T and DIRECTV while sustaining total debt to EBITDA below 4.5x (Moody's adjusted). What Could Change the Rating -- Down Ratings could experience downward migration if: (i) the company pursues further debt-financed acquisitions over the near-term that are not meaningfully accretive to EBITDA; (ii) Moody's expects the company's total debt to EBITDA will be sustained at or above 6x (Moody's adjusted); or (iii) liquidity is strained such that the revolving credit facility is largely drawn and free cash flow is negative for extended periods. In addition, the rating could be revised downward if Goodman witnessed a sudden slowdown in customer demand or if further concerns regarding material weaknesses in internal and accounting controls resurfaced. The principal methodology used in rating Goodman Networks, Inc. was Global Construction Methodology published in November 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. Goodman Networks, Inc., headquartered in Plano, TX, is a specialized technical service provider to wireless and wireline carriers throughout the US. Goodman provides outsourced cell site builds, upgrades, and professional services to maintain and improve existing networks. Goodman executes projects for its principal customer, AT&T, in seven major markets. Revenue for the twelve months ended March 31, 2013 totaled approximately $633 million. GOODMAN NETWORKS: S&P Retains 'B' Notes Rating After $100MM Add-On ------------------------------------------------------------------ Standard & Poor's Ratings Services said that its ratings on U.S. telecom services provider Goodman Networks Inc.'s senior secured notes due 2018, including the 'B' issue-level rating and '4' recovery rating, remain unchanged following the company's $100 million add-on to the notes. The proposal will increase the size of the facility to $325 million from $225 million. The '4' recovery rating indicates expectations for average (30% to 50%) recovery of principal in the event of payment default. The company intends to use the proceeds from the add-on, in addition to around $26 million in cash, to fund the acquisition of Multiband and pay transaction fees. Multiband operates in 19 states across the U.S., and primarily provides equipment installation services for DirecTV customers. The acquisition reduces the company's concentration of revenues from AT&T, and provides Goodman with a skilled labor force that can be leveraged to complete small cell infrastructure projects for wireless carriers. "Our 'B' corporate credit rating and stable outlook on Goodman Networks Inc. are unchanged. In our view, the company has a "vulnerable" business risk profile given its high customer concentration, even after the acquisition of Multiband. The company expects that AT&T will still make up over half of the company's revenues following the acquisition, down from just below 90%. However, we view the company's existing contractual relationships as relatively firm and its operations are in densely populated markets, which will be the primary focus of wireless infrastructure spending over the next few years. We view the company's financial risk profile as "aggressive," reflecting our expectation of debt to EBITDA in the high-4x area by year-end 2013, pro forma for the acquisition of Multiband. In addition, we believe the company has reasonable prospects to generate positive FOCF results over the next few years, reflecting low capital spending requirements," S&P said. RATINGS LIST Goodman Networks Inc. Corporate Credit Rating B/Stable/-- $325 Mil. Senior Secured Notes Due 2018 B Recovery Rating 4 GREGORY & PARKER: Two Banks' Bid to Dismiss Bankr. Cases Denied --------------------------------------------------------------- Two bank creditors failed to convince a North Carolina bankruptcy court to dismiss or convert the bankruptcy cases of Gregory & Parker, Inc., et al., in a May 23, 2013 Order available at http://is.gd/xoKD0afrom Leagle.com. The case involves the procedural consolidation and joint administration of two bankruptcy cases -- Gregory & Parker, Inc., Case No. 12-01382-8-SWH, and Gregory & Parker-Seaboard, LLC, Case No. 12-01383-8-SWH. The Debtors each filed for Chapter 11 relief on Feb. 22, 2012. William Douglas Parker, Jr., the Debtors' president, and his wife, Diana Lynne Parker, the Debtors' corporate secretary, filed their own bankruptcy case on April 25, 2012. Plans of reorganization were filed in the Debtors' cases and in the Parkers case in November 2012. Regions Bank and Georgia Capital, LLC are by far, the largest secured creditors of the Debtors. Regions Bank filed a $19.075 million claim in all three bankruptcy cases based on a promissory note executed by Seaboard in favor of Regions in the original amount of $13.5 million. Georgia Capital also filed a $4 million claim in the Gregory & Parker case and a $4.1 million claim in the Parkers case, based on two promissory notes both of which were executed by Mr. Parker. The banks' claims are secured by certain properties of the Debtors. In a May 23 decision, Bankruptcy Judge Stephani W. Humrickhouse concluded that Regions Bank and Georgia Capital failed to satisfy their burden of showing that cause exists to dismiss or convert to a Chapter 7 proceeding the Debtors' cases. The judge said it is unclear from evidence produced that the Debtors has suffered from a substantial or continuing negative cash flow since bankruptcy filing. The bankruptcy court is also unpersuaded by the assertion that the Debtors lacked a reasonable likelihood of rehabilitation. Judge Humrickhouse said, "The evidence presented during the hearing indicated that the Debtors are on a much stronger basis financially than before filing bankruptcy." The judge also said she is not convinced that the Debtors lack the ability to effectuate a feasible plan. "The Debtors are maintaining operations and generating income post-petition, income that has so far been sufficient to satisfy current operating expenses, make monthly adequate protection payments, pay rather significant administrative expenses, and accumulate some cash reserves. The Debtors and the Parkers also have the ability, and have expressed an intent, to liquidate non-income producing property to satisfy at least two of the largest secured claims in their cases. A feasible plan may be effectuated by a combination of the income produced from Seaboard's operations and the liquidation of other properties, even if the Debtors do not prevail on their claim objections." Lastly, Judge Humrickhouse said she does not find that there has been any unreasonable delay by the Debtors resulting in actual prejudice to the creditors. About Gregory & Parker Gregory & Parker owns Seaboard Station, a retail center near William Peace University at the northern fringe of downtown Raleigh, North Carolina. Gregory & Parker filed a Chapter 11 petition Feb. 22, 2012 (Bankr. E.D. N.C. Case No. 12-01382). Richard D. Sparkman, Esq., at Richard D. Sparkman & Assoc., P.A., represents the Debtor. The Debtor estimated assets of between $100,000 and $500,000, and debts of between $10 million and $50 million. GREENBRIER NURSERIES: Case Summary & Creditors List --------------------------------------------------- Debtor: Greenbrier Nurseries Of Beckley, LLC 225 Pinewood Drive Beckley, WV 25802 Bankruptcy Case No.: 13-50104 Chapter 11 Petition Date: May 29, 2013 Court: U.S. Bankruptcy Court Southern District of West Virginia (Beckley) Judge: Ronald G. Pearson Debtor's Counsel: Christopher S. Smith, Esq. HOYER, HOYER & SMITH, PLLC 22 Capitol Street Charleston, WV 25301 Tel: (304) 344-9821 Fax: (304) 344-9519 E-mail: chris@hhsmlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 Affiliate that simultaneously filed for Chapter 11: Debtor Case No. ------ -------- Greenbrier Nurseries, Inc. 13-50105 Assets: $1,000,001 to $10,000,000 Debts: $1,000,001 to $10,000,000 The petitions were signed by James E. Monroe, Jr., member. A. Greenbrier Nurseries Of Beckley, LLC?s list of its 14 largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/wvsb13-50104.pdf B. Greenbrier Nurseries, Inc.?s list of its 12 largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/wvsb13-50105.pdf Affiliate that filed separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- Monroe Gardens, LLC 13-50095 05/17/13 GREENVILLE LAND: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: Greenville Land Investors, L.P. 5220 Spring Va32-034941750lley Road, Suite 204 Dallas, TX 75254 Tel: (972) 386-6600 Bankruptcy Case No.: 13-41337 Chapter 11 Petition Date: May 29, 2013 Court: U.S. Bankruptcy Court Eastern District of Texas (Sherman) Debtor's Counsel: John Hatchett Carney, Esq. JOHN H. CARNEY & ASSOCIATES 5005 Greenville Avenue, Suite 200 Dallas, TX 75206 Tel: (214) 368-8300 Fax: (214) 363-9979 E-mail: jcarney@johnhcarney.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by C. Kent Conine, president. GUNDER ROAD: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Gunder Road Holdings, LLC 1555 Southcross Drive Burnsville, MN 55306 Bankruptcy Case No.: 13-32622 Chapter 11 Petition Date: May 29, 2013 Court: U.S. Bankruptcy Court District of Minnesota (St. Paul) Judge: Michael E. Ridgway Debtor's Counsel: Ralph Mitchell, Esq. LAPP LIBRA THOMSON STOEBNER & PUSCH One Financial Plaza, Suite 2500 120 S. 6th Street Minneapolis, MN 55402 Tel: (612) 338-5815 E-mail: rmitchell@lapplibra.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company?s list of its 20 largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/mnb13-32622.pdf The petition was signed by Brent Johnson, chief manager. GYMBOREE CORP: Bank Debt Trades at 1.83 % Off in Secondary Market ----------------------------------------------------------------- Participations in a syndicated loan under which Gymboree Corp is a borrower traded in the secondary market at 98.17 cents-on-the-dollar during the week ended Friday, May 31, 2013, according to data compiled by LSTA/Thomson Reuters MTM Pricing and reported in The Wall Street Journal. This represents a drop of -0.81 percentage points from the previous week, the Journal relates. The loan matures Feb. 23, 2018. The Company pays 350 basis points above LIBOR to borrow under the facility. The bank debt carries Moody's B2 rating and S&P's B- rating. Headquartered in San Francisco, California, the Gymboree Corporation operated 1,228 retail stores as of October 27, 2012, comprising Gymboree, Gymboree Outlet, Janie and Jack, and Crazy 8 stores as well as online stores for these brands. The company also offers directed parent-child development play programs at 714 franchised and Company-operated Gymboree Play & Music centers in the United States and 42 other countries. HARPER BRUSH: Case Converted to Chapter 7 ----------------------------------------- Harper Brush Works, Inc., which sold its business for $3.45 million to Cequent Consumer Products Inc., last year, failed to confirm a liquidation plan in March 2013 and had its Chapter 11 case converted to a liquidation under Chapter 7 of the Bankruptcy Code. U.S. Bankruptcy Judge Anita L. Shodeen approved Harper Brush's motion to convert its chapter 11 case to chapter 7 in a March order. A critical hearing scheduled for March 21 was also canceled. As reported by the Troubled Company Reporter on March 22, 2013, Judge Shodeen denied confirmation of Harper Brush's second amended plan of reorganization. Judge Shodeen had directed for the filing of a new combined disclosure statement and plan. The Plan contemplated that substantially all of the Debtor's assets would be sold prior to confirmation. In conjunction with the sale to Cequent, and as part of the sale process, the Debtor was to change its name to HBW Bankruptcy Estate, Inc. at consummation of said sale. The sale proceeds were to be held in a trust account and disbursed pursuant to the Plan and Confirmation Order on the Effective Date of the Plan. Any unsold assets would be sold or otherwise liquidated either before or after the Effective Date, and distributed pursuant to the Plan. Fairfield, Iowa-based Harper Brush Works, Inc., filed a Chapter 11 petition (Bankr. S.D. Iowa) in Des Moines on May 29, 2012. Family-owned Harper Brush -- http://www.harperbrush.com/-- provided more than 1,000 products, including pushbrooms, mops, floor squeegees, automotive brushes, dust pans, and buckets. The Company disclosed assets of $10.4 million against debt totaling $10 million, including $6 million owing to secured creditors. Judge Anita L. Shodeen presides over the case. Donald F. Neiman, Esq., and Jeffrey D. Goetz, Esq., at Bradshaw, Fowler, Proctor & Fairgrave, P.C., serve as bankruptcy counsel to the Debtor. Equity Partners CRB LLC serves as the Debtor's investment banker. An official committee of unsecured creditors appointed in the case is represented by Richard S. Lauter, Esq., and Thomas R. Fawkes, Esq., at Freeborn & Peters LLP, in Chicago, as general bankruptcy counsel. Joseph A. Peiffer, Esq., at Day Rettig Peiffer, P.C., in Cedar Rapids, Iowa, represents the Committee as local counsel. HARRIS COUNTY HSA: Moody's Maintains Ba3, B2 & B3 3rd Lien Ratings ------------------------------------------------------------------ Moody's Investors Service, Inc. maintains the underlying Ba3 senior, B2 junior, and B3 third lien ratings on the outstanding bonds of Harris County - Houston Sports Authority. The rating outlook is stable. All bonds are insured by National Public Finance Guarantee Corp ("National" or "bond insurer"; Insurance Financial Strength rated Baa1/positive outlook). Harris County - Houston Sports Authority is a special purpose entity created to finance the construction of Reliant Stadium, Toyota Center and Minute Maid Park in the Houston, TX region. Ratings Rationale: The below investment grade ratings continue to reflect dependence on long-term revenue growth to match the rising debt service amortization schedule on the junior and third lien bonds, coupled with the expected long-term volatility of the pledged hotel (HOT) and motor vehicle rental (MVRT) special tax revenue streams and the increasingly contentious and currently litigious relationship between the Authority and the bond insurer National. The current lawsuit with National exemplifies the myriad of potential issues that could arise should the junior fixed rate bonds default in the future. At some point in the future the additional required reserve (ARR) may be depleted if revenues do not grow faster than the junior lien debt service amortization schedule and National may have to pay on the junior lien bonds. This could result in a cross default to the senior lien bonds, but neither the senior lien nor the junior lien fixed rate bonds can be accelerated as a remedy for the default. The Ba3 senior lien bond rating primarily reflects the cross default provision under the bond indenture and the two notch rating difference from the B2 junior lien bonds considers the satisfactory projected debt service coverage ratios of the senior lien bonds through the life of the bonds even if at current revenue levels. The Ba level rating also incorporates the volatility associated with the credit and the higher likelihood of triggering the cross default due to the aggressive junior lien amortization schedule as well as the lack of a debt service reserve fund dedicated specifically to the senior lien bonds. The B2 junior lien rating reflects the Authority's significantly increased debt service costs due to the acceleration of principal payments on the variable rate junior lien bonds. The B2 rating also reflects the rising long-term amortization schedule of the fixed rate junior lien bonds that require significant tax revenue growth in order to ensure a payment default does not occur over the 30 year amortization period. Moody's projections indicate that post acceleration of the variable rate bonds under low growth scenarios, the junior lien bonds would deplete the additional required reserve within a decade given the rapidly rising amortization schedule relative to actual revenue growth. The B3 third lien bond rating reflects the super subordinate lien position of the bonds and the fact that they do not begin to amortize until 2031, leaving these bondholders least protected and in the last payment position. The third lien bond indenture does not contain a cross default provision related to the junior or senior lien bonds. Outlook The stable outlook reflects Moody's expectation that the additional required reserve (ARR) will be sufficient to cover the projected revenue shortfalls related to the accelerated junior lien variable rate bonds through May 2014. The stable outlook also balances the higher pledged tax revenue collections in the near term with an increasingly contentious relationship between the Authority and the bond insurer National that may have unintended consequences or impacts on bondholders. What Could Change the Rating Up The ratings could face upward pressure if the HOT/MVRT revenue growth is sustained throughout 2013, meeting Moody's projections of generating excess cashflow to fund R&R funds or add to the ARR in fiscal 2014. The junior and third lien ratings could improve if Moody's expectations of future revenue performance more closely matches the projected rising annual debt service costs over the long-term. What Could Change the Rating Down The ratings could be further downgraded if the recovery prospects for bondholders are deemed to be less than currently anticipated and/or if HOT/MVRT revenues notably decline or grow at a rate below that of the debt service amortization schedule. The ratings could also be downgraded if the shared additional required reserve is significantly depleted. Rating Methodology The principal methodology used in this rating was US Public Finance Special Tax Methodology published in March 2012. HEALTH NET: Fitch Affirms 'BB+' Issuer Default Rating ----------------------------------------------------- Fitch Ratings has affirmed Health Net Inc.'s Issuer Default Rating (IDR) at 'BB+', senior unsecured notes at 'BB', and Insurer Financial Strength (IFS) ratings on Health Net's operating subsidiaries at 'BBB'. The Rating Outlook is Stable. Key Rating Drivers Health Net's ratings continue to reflect the company's overall 'small' market position and size/scale features. Specifically, Health Net is concentrated in California with less geographic diversification and size and scale benefits compared to higher rated peers. The ratings also reflect capitalization metrics that are generally consistent with Fitch's median rating category guidelines for the company's current ratings and an expectation that earnings will be less volatile going forward. Balanced against these strengths is a history of uneven operating results due to a series of one-time charges to earnings. Health Net's market position is considered 'medium' given the company operates primarily in California but has an expanding presence in three other Western states. The size and scale of Health Net's operations are considered 'small' by Fitch when measured by a medical membership of 2.5 million individuals and total revenue of less than $11.3 billion for the full year 2012. Health Net's year-end 2012 NAIC RBC ratio of 196% (company action level basis) is consistent with Fitch's median guideline of 175% for the company's rating category but generally below those of higher-rated competitors. Management targets an NAIC RBC ratio of 200% for its underwriting subsidiaries, excluding Health Net Community Solutions, Inc. Health Net's ratio of debt to most recent four quarters' EBITDA was 2.6x and operating EBITDA to interest expense was 9.9x during the first quarter of 2013. Both ratios were better than Fitch's median guidelines for the rating category. Fitch considers these leverage and coverage ratios better run-rate indicators than the 5.2x debt to EBITDA and 1.8x interest coverage posted for full year 2012. During the fourth quarter of 2012, Health Net and the state of California's Department of Health Care Services (DHCS) entered into a comprehensive agreement covering Health Net's state- sponsored programs. The agreement is expected to reduce earnings volatility by establishing mutually agreed upon margin targets for state-sponsored business and working to improve the process for settling rate disputes. Rating Sensitivities Key ratings triggers that could lead to an upgrade within the 'BBB' IFS rating category for Health Net include: -- Sustained solid earnings with less volatility measured by EBITDA margin in excess of 3%, return on average capital in the high single digits and absence of 'one-time' charges; -- Maintenance of consolidated Risk-Based Capital (RBC) above 200% of the Company Action Level (CAL) and debt-to-EBITDA below 2.5x; -- Quality reserves measured by flat-to-favorable reserve development; -- Profitable geographic diversification and expansion of the company's premium and membership base. Key ratings triggers that could lead to a downgrade for Health Net include: -- Sustained trend of poor earnings results or significant volatility in earnings despite DHCS agreement; -- Material loss of commercial membership beyond management's 2013 guidance; -- A significant decline in consolidated Risk-Based Capital (RBC) below 175% of the CAL or debt-to-EBITDA greater than 3.0x. Fitch has affirmed the following ratings with a Stable Outlook: Health Net Inc. -- Long-term IDR at 'BB+'; -- 6.375% senior notes due June 2017 at 'BB'; Health Net Of California, Inc Health Net of Arizona, Inc Health Net Plan of Oregon, Inc -- IFS at 'BBB'. INTERNATIONAL HOME: June 10 Hearing on Approval of Plan Outline --------------------------------------------------------------- The Bankruptcy Court will convene a hearing on June 10, 2013, at 9:30 a.m., to consider adequacy of the Amended Disclosure Statement dated March 20, 2013, explaining the proposed Chapter 11 Plan filed by International Home Products, Inc., and Health Distillers International, Inc., and the objection to the Plan outline filed by Firstbank-Puerto Rico. As reported by the Troubled Company Reporter on May 8, 2013, FirstBank PR, as secured creditor, related that the Debtors continue to include inaccurate, incomplete and misleading statements and do not provide adequate information for the Bank or any other creditors to make an informed judgment of the Debtors' Amended Plan. In addition, the Bank said that the Amended Plan is not feasible for the following reasons: * There is lack of support for the projections; * Cash Sales & Collections have been consistently declining on a Monthly basis since the filing of the petition for bankruptcy. * The Debtors' projections' that Other Operating Expenses will be only $1,355,135 for the first year is "totally inconsistent" with the Debtors' past history. The Bank claims the Debtors have not provided any basis or explanation to sustain their claim that they are going to lower their biggest expense to only 22% of the annualized amount spent during the previous year. * The Debtors' projections do not include any amount for "Travel and Entertainment" expenses. * The Debtors' projections on income and expenses contrast dramatically with Debtors' auditors Aquino, De Cordova, Alfaro & Co., LLP's expectations of zero net income until the year 2020. The Bank further stated that the Liquidation and Property Analysis is inadequate, and that proposed treatment of the Bank's secured and unsecured claims is not acceptable. The Bank added that the Debtors also failed to include in Class (2) of creditors with superpriority rank, the Bank's cash collateral that was used by the Debtors from the date of the filing of the bankruptcy petitions until July 2, 2012. The Bank is represented by lawyers at Toro Colon Mullet Rivera & Sifre P.S.C., in San Juan, Puerto Rico: Manuel Fernandez-Bared, Esq. mfb@tcmrslaw.com Angel Sosa-Baez, Esq. asosa@tcmrslaw.com Linette Figueroa-Torres, Esq. lft@tcmrslaw.com A copy of the Bank's Objections to the Debtors' Consolidated Amended Disclosure statement is available at: http://bankrupt.com/misc/internationalhome.doc439.pdf The Plan As reported by the TCR on April 9, 2013, the Debtors amended their disclosure statement and plan to provide for these terms: * The secured claim of A. Bert Foti will be allowed in the amount of $500,000 and will be paid on the second year of the Plan. * First Bank's valid liens over the Debtor's properties arising from the $12.2 million prepetition term loan facility will be paid in monthly installments of $32,105 considering an amortization of 20 years and interest at the prime rate. First Bank's allowed secured claims arising from other prepetition lines of credit will be paid in the amount of $1.9 million with monthly installments of $8,328 considering an amortization of 20 years and interest at the prime rate. First Bank's unsecured claim, estimated in the amount of $6.6 million will receive 10% of its claim. * CRIM's secured claim in the amount of $30,539 will be paid in monthly installments within 60 months from the Petition Date, including interest at the prime rate. * The class that includes the secured portion of the claim filed by each of Preferred Credit Inc. and American Enterprises International Inc. will retain its liens and will be paid pursuant to the agreement that rules their relation with the Debtor. * General unsecured priority claims related to clients deposits will be paid on the effective date. Other general unsecured claims will be paid 10% of its claim in monthly installments within 60 months from the effective date. * Insiders and holders of equity interests will not receive anything under the Plan. A full-text copy of the Debtors' Consolidated Amended Disclosure Statement and Summary of Proposed Plan of Reorganization dated March 20, 2013, is available for free at: http://bankrupt.com/misc/INTLHOMEds0320.pdf About International Home Products International Home Products, Inc., is engaged in the sale, financing of "Lifetime" cookware and other kitchenware as well as sale of account receivables in the secondary market. It is the exclusive distributor of "Lifetime" products in Puerto Rico for over 40 years. The Company filed for Chapter 11 bankruptcy protection (Bankr. D.P.R. Case No. 12-02997) on April 19, 2012. Carmen D. Conde Torres, Esq., in San Juan, P.R., serves as the Debtor's counsel. Wigberto Lugo Mendel, CPA, serves as its accountants. The Debtor disclosed $66,155,798 and $43,350,031 in liabilities as of the Chapter 11 filing. Secured lender First-Bank Puerto Rico is represented by Manuel Fernandez-Bared, Esq., Angel Sosa-Baez, Esq., and Linette Figueroa-Torres, Esq., at Toro, Colon, Mullet, Rivera & Sifre, P.S.C. On May 7, 2012, International Home's affiliate, Health Distillers International, Inc., filed a separate Chapter 11 petition (Bankr. D.P.R. Case No. 12-03574. INTERNATIONAL HOME: June 10 Hearing on Bank's Bid to Convert Case ----------------------------------------------------------------- FirstBank-Puerto Rico, as secured creditor of International Home Products, Inc., and Health Distillers International, Inc., has asked the Bankruptcy Court to convert the Chapter 11 cases of International Home Products, Inc. and Health Distillers International, Inc., to those under Chapter 7 of the Bankruptcy Code. FirstBank-PR explained that the Debtors' illegal use of the Bank's cash collateral and property, their noncompliance with the Court's rulings, their mismanagement of the estate, tax evasion, and the illusory prospects of reorganization constitute sufficient and adequate cause for the Court to order the conversion to chapter 7 and allow the prompt liquidation of Debtors' assets and payment to Debtors' creditors. The Court, in a separate order and notice to consider, stated that if an opposition is filed, a hearing will be held on June 10, 2013, at 9:30 a.m. About International Home Products International Home Products, Inc., is engaged in the sale, financing of "Lifetime" cookware and other kitchenware as well as sale of account receivables in the secondary market. It is the exclusive distributor of "Lifetime" products in Puerto Rico for over 40 years. The Company filed for Chapter 11 bankruptcy protection (Bankr. D.P.R. Case No. 12-02997) on April 19, 2012. Carmen D. Conde Torres, Esq., in San Juan, P.R., serves as the Debtor's counsel. Wigberto Lugo Mendel, CPA, serves as its accountants. The Debtor disclosed $66,155,798 and $43,350,031 in liabilities as of the Chapter 11 filing. Secured lender First-Bank Puerto Rico is represented by Manuel Fernandez-Bared, Esq., Angel Sosa-Baez, Esq., and Linette Figueroa-Torres, Esq., at Toro, Colon, Mullet, Rivera & Sifre, P.S.C. On May 7, 2012, International Home's affiliate, Health Distillers International, Inc., filed a separate Chapter 11 petition (Bankr. D.P.R. Case No. 12-03574. JAZZ PHARMACEUTICALS: Debt Increase No Impact on Moody's Ba3 CFR ---------------------------------------------------------------- Moody's Investors Service commented that the planned upsized term loan and revolving credit agreement of Jazz Pharmaceuticals, Inc. is credit negative because of added financial leverage. However, Jazz's credit metrics will remain healthy and within Moody's expectations for the Ba3 rating. There are no changes to Jazz's ratings including the Ba3 Corporate Family Rating, the B1-PD Probability of Default Rating, the Ba3 senior secured rating or the SGL-1 Speculative Grade Liquidity Rating. The rating outlook is stable. The principal methodology used in this rating was the Global Pharmaceutical Industry published in December 2012. Other methodologies used include Loss Given Default for Speculative- Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Jazz Pharmaceuticals, Inc. is a US subsidiary of Jazz Pharmaceuticals plc, a specialty pharma company with a portfolio of products that treat unmet needs in narrowly focused therapeutic areas. Total revenues for the twelve months ended March 31, 2013 were approximately $680 million. JG WENTWORTH: S&P Revises Outlook to Negative & Affirms 'B' ICR --------------------------------------------------------------- Standard & Poor's Ratings Services said it revised its outlook on J.G. Wentworth LLC to negative from stable. At the same time, Standard & Poor's affirmed its 'B' long-term issuer credit rating on the company. "The outlook revision reflects our view of the incremental elevation of financial risk on the part of the company due to its issuance of an additional $125 million of term debt," said Standard & Poor's credit analyst Thomas Connell. This adds to the $425 million of term debt issued in February 2013. The previous issue increased J.G. Wentworth's debt to EBITDA ratio significantly, and S&P indicated the potential for a negative rating action were the leverage to increase further such that debt to EBITDA would increase above 4x. The increase in the term debt moves leverage slightly above the 4x multiple, more than offsetting the benefit to the company's debt servicing capacity arising from strong EBITDA generation through the first quarter of 2013. The issuance of additional term debt will be used to fund a distribution to shareholders. The issuer credit rating on J.G. Wentworth reflects Standard & Poor's assessment of the narrow scope of the company's business activities, highly leveraged balance sheet, and business model that depends on continuously replenishing asset origination and the subsequent access to refinancing. In S&P's view, J.G. Wentworth's leading market position somewhat offsets these risks. The company's primary activity is the purchase and financing of structured settlement payment streams. Its ongoing profitability depends, in part, on continuous origination of structured settlement payment purchases and the subsequent access to take-out refinancing. S&P believes access to funding markets remains a key risk for the company, while recognizing that the company's current financing arrangements provide it with more capacity and flexibility compared with arrangements that led to refinancing difficulties in 2009. J.G. Wentworth faces competition for the origination of new assets in terms of both identifying prospective settlement payment sellers and successfully closing transactions. It benefits from a high profile in this specialty sector due to its operation under the two leading brands--Wentworth and Peachtree--and the considerable economies it enjoys relative to competitors on marketing, originations, and funding. The outlook is negative. S&P could lower the rating if Wentworth's leverage persists at about a 4.5x EBITDA-multiple. S&P could revise the outlook to stable if solid earnings performance over the remainder of 2013 establishes momentum for the reduction of the debt-to-EBITDA ratio toward 4x, while the company maintains or strengthens its overall market position. KEELEY AND GRABANSKI: G&K Farms et al.'s Claims Disallowed ---------------------------------------------------------- Bankruptcy Judge Thad Collins sustained the objections of Kip M. Kaler, the Chapter 7 Trustee of Keeley and Grabanski Land Partnership, to the proofs of claim filed by G&K Farms (claim #12) and Merlyn and Dolores Grabanski (claim #13), who argued that both claims should be denied in their entirety. A copy of the Court's May 30, 2013 Memorandum and Order is available at http://is.gd/D7XI3ofrom Leagle.com. On March 5, 2012, G&K Farms filed a proof of claim for $1,069,054. During the hearing on its proof of claim, G&K Farms expressed its intention to amend its claim to seek only $730,568. Merlyn and Dolores Grabanski filed a proof of claim on March 5, 2012, for $371,000. About Keeley and Grabanski Thomas Grabanski, a North Dakota farmer, is mired in three separate Chapter 11 bankruptcy cases. Mr. Grabanski and his wife Mari filed a personal Chapter 11 bankruptcy petition (Bankr. D. N.D. Case No. 10-30902) on July 22, 2010. DeWayne Johnston, Esq., at Johnston Law Office, represents the Grabanskis in their Chapter 11 case. The Grabanskis estimated assets between $1 million and $10 million, and debts between $10 million and $50 million. On July 23, 2010, Mr. Grabanski signed a Chapter 11 petition for Grabanski Grain LLC (Bankr. D. N.D. Case No. 10-30924). DeWayne Johnston, Esq., also represents Grabanski Grain. The Debtor is estimated to have assets and debts of $1 million to $10 million. Former owners, John and Dawn Keely, in December 2010 forced the partnership Keeley and Grabanski Land Partnership in Texas into Chapter 11. The former owners filed an involuntary Chapter 11 bankruptcy petition against the partnership (Bankr. D. N.D. Case No. 10-31482) on Dec. 6, 2010. Kenneth Corey-Edstrom, Esq., at Larkin Hoffman Daly & Lindgren Ltd., represents the petitioner. The U.S. Bankruptcy Appellate Panel for the Eighth Circuit later affirmed the Bankruptcy Court's order appointing a trustee in Keeley and Grabanski Land Partnership's involuntary Chapter 11 case. Kip M. Kaler, Chapter 11 trustee of Keeley and Grabanski Land Partnership, won authority to employ Kaler Doeling Law Office as counsel. Keeley and Grabanski Land Partnership in Texas -- since 2009 doing business as Grabanski Land Partnership -- was formed in 2007 for Texas farming operations between farmers Thomas Grabanski and John Keeley of Grafton, N.D., and their wives. K&G Land, along with a separate farming partnership, operated more than 10,000 acres of corn and sunflowers from 2007 to 2009 in two locations in Texas near the towns of Blossom and DeKalb. In separate, related lawsuits, the Grabanskis face several "adversarial" lawsuits, filed by certain creditors. The creditors who filed suits include Crops Production Services Corp., AgCountry Farm Credit Services, and PHI Financial. KEELEY AND GRABANSKI: Can't Employ DeWayne Johnston as Counsel -------------------------------------------------------------- Bankruptcy Judge Thad Collins rejected the application of Keeley and Grabanski Land Partnership to employ DeWayne Johnston, Johnston Law Office, as its attorney. The United States Trustee, Choice Financial Group, John and Dawn Keeley, and Kip M. Kaler, the Chapter 7 trustee, objected to the application. In denying the request, Judge Collins cited numerous conflicts of interest that exist and the additional conflicts that would result. A copy of the Court's May 30, 2013 Memorandum and Order is available at http://is.gd/10ZCiRfrom Leagle.com. About Keeley and Grabanski Thomas Grabanski, a North Dakota farmer, is mired in three separate Chapter 11 bankruptcy cases. Mr. Grabanski and his wife Mari filed a personal Chapter 11 bankruptcy petition (Bankr. D. N.D. Case No. 10-30902) on July 22, 2010. DeWayne Johnston, Esq., at Johnston Law Office, represents the Grabanskis in their Chapter 11 case. The Grabanskis estimated assets between $1 million and $10 million, and debts between $10 million and $50 million. On July 23, 2010, Mr. Grabanski signed a Chapter 11 petition for Grabanski Grain LLC (Bankr. D. N.D. Case No. 10-30924). DeWayne Johnston, Esq., also represents Grabanski Grain. The Debtor is estimated to have assets and debts of $1 million to $10 million. Former owners, John and Dawn Keely, in December 2010 forced the partnership Keeley and Grabanski Land Partnership in Texas into Chapter 11. The former owners filed an involuntary Chapter 11 bankruptcy petition against the partnership (Bankr. D. N.D. Case No. 10-31482) on Dec. 6, 2010. Kenneth Corey-Edstrom, Esq., at Larkin Hoffman Daly & Lindgren Ltd., represents the petitioner. The U.S. Bankruptcy Appellate Panel for the Eighth Circuit later affirmed the Bankruptcy Court's order appointing a trustee in Keeley and Grabanski Land Partnership's involuntary Chapter 11 case. Kip M. Kaler, Chapter 11 trustee of Keeley and Grabanski Land Partnership, won authority to employ Kaler Doeling Law Office as counsel. Keeley and Grabanski Land Partnership in Texas -- since 2009 doing business as Grabanski Land Partnership -- was formed in 2007 for Texas farming operations between farmers Thomas Grabanski and John Keeley of Grafton, N.D., and their wives. K&G Land, along with a separate farming partnership, operated more than 10,000 acres of corn and sunflowers from 2007 to 2009 in two locations in Texas near the towns of Blossom and DeKalb. In separate, related lawsuits, the Grabanskis face several "adversarial" lawsuits, filed by certain creditors. The creditors who filed suits include Crops Production Services Corp., AgCountry Farm Credit Services, and PHI Financial. KGHM INTERNATIONAL: S&P Revises Ratings Outlook to Negative ----------------------------------------------------------- Standard & Poor's Ratings Services said it revised its outlook on Vancouver-based KGHM International Ltd. (KGHMI) to negative from stable. At the same time, Standard & Poor's affirmed all its ratings on the company, including its 'BB-' long-term corporate credit rating. "We base our outlook revision on the expected weakening in the company's credit metrics in the next 12 months," said Standard & Poor's credit analyst George Economou. "In our view, KGHMI will incur debt to fund its larger share of Sierra Gorda capital expenditures, which was previously not included in our forecasts," Mr. Economou added. As such, S&P expects adjusted debt-to-EBITDA leverage could increase above 4.0x -- one of its key thresholds for ratings pressure -- in 2014. The ratings on KGHMI reflect what Standard & Poor's views as the company's "weak" business risk profile and "aggressive" financial risk profile. S&P considers key credit risks to be the company's exposure to volatile copper prices, its fourth-quartile cost profile, the relatively short reserve life of most of its mines, and its large growth capital expenditures. S&P believes these risks are partially mitigated by KGHMI's modest debt leverage and satisfactory operating diversity in attractive and lower-risk mining jurisdictions. Moreover, S&P's 'BB-' long-term corporate credit rating on the company is one notch higher than it would be on a stand-alone basis, reflecting S&P's expectation of potential support from a parent with a stronger credit profile. KGHMI operates five copper mines in the U.S., Canada, and Chile, and holds interests in the Chile-based Sierra Gorda project (55% equity interest) currently under construction and the Sudbury, Ont.-based Victoria development project. KGHMI established a joint venture (JV) with Sumitomo Metal Mining Co. Ltd. (not rated) and Sumitomo Corp. to develop Sierra Gorda. The negative outlook on KGHMI is based on S&P's view that the company's credit metrics could weaken in the next 12 months due primarily to an increase in debt related to the funding of its share of Sierra Gorda development costs and narrower profitability. S&P expects the company will require incremental debt financing to fund its 2014 project capital obligations and help maintain an adequate liquidity profile. Given that KGHMI is not expected to receive cash flow from the Sierra Gorda JV in this period, S&P could lower the rating if it believes that adjusted debt-to-EBITDA will increase beyond 4.0x on a sustainable basis. While unlikely in the next several quarters of construction at the Sierra Gorda project, S&P could revise the outlook to stable in the event that it sees favorable prospects for the company to limit total balance-sheet debt to an extent that improves S&P's view of leverage staying under 4.0x through 2014. LICHTIN/WADE LLC: Case Converted for Lack of Plan Funding --------------------------------------------------------- The Hon. Randy D. Doub of the U.S. Bankruptcy Court for the Eastern District of North Carolina converted the Chapter 11 case of Lichtin/Wade LLC to one under Chapter 7 of the Bankruptcy Code. Joseph N. Callaway, upon the recommendation of the Bankruptcy Administrator, is appointed as the Chapter 7 Trustee to administer the estate and perform the duties. The Court finds there is a substantial or continuing loss to or diminution of the estate and the absence of a reasonable likelihood of rehabilitation. The Court finds it doubtful that the Debtor will have the ability to confirm any proposed plan of reorganization without First Rock's equity investment, and Gregg Robertson's withdrawal of his offer to provide an equity investment. At the previous confirmation hearing, Mr. Robertson testified that First Rock had a line of credit with its bank and funding was available up to $1,500,000. Mr. Robertson testified that although the Disclosure Statement proposed that First Rock would provide up to $4,500,000, First Rock had the ability to provide additional funds in excess of the amount if necessary. About Lichtin/Wade Lichtin/Wade LLC filed for Chapter 11 bankruptcy (Bankr. E.D.N.C. Case No. 12-00845) on Feb. 2, 2012, amid efforts to refinance $39 million in construction-related loans and other debts connected to two office buildings built in 2008 at 5420 and 5430 Wade Park Blvd. Lichtin/Wade, based in Wake County, North Carolina, owns and operates the office park known as the Offices at Wade, comprised of two Class A office buildings and vacant land approved for additional office buildings. The buildings are known as Wade I and Wade. Each building is over 90% leased, with only three vacant spaces remaining between the two buildings. Judge Randy D. Doub presides over the case. Trawick H. Stubbs, Jr., Esq., and Laurie B. Biggs, Esq., at Stubbs & Perdue, P.A., serve as the Debtor's counsel. The Debtor disclosed $47,053,923 in assets and $52,548,565 in liabilities as of the Petition Date. The petition was signed by Harold S. Lichtin, president of Lichtin Corporation, the Debtor's manager. LIFE UNIFORM: Enters Into Asset Purchase Deal with Scrubs & Beyond ------------------------------------------------------------------ Healthcare Uniform Company, Inc. and Uniform City National, Inc., Operator of 205-store Life Uniform and Uniform City hospital uniforms and accessories retailer, filed a Chapter 11 petition (Bankr. D. Del. Case No. 13-11391) on May 29 in Delaware with a contract in hand selling the business for $22.6 million to Scrubs & Beyond LLC. Scrubs & Beyond signed a stalking horse asset purchase agreement to acquire substantially all of the operating assets of Life Uniform. Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that an affiliate of Sun Capital Partners Inc. in 2004, the chain owes $37.5 million to Capital Source Finance LLC on a revolving credit and term loan. A Sun Capital affiliate has a second-lien obligation for $6.1 million. Angelica Corp. holds a $6.3 million subordinated note. Life Uniform filed the stalking horse asset purchase agreement with the U.S. Bankruptcy Court for the District of Delaware along with a motion seeking the establishment of bidding procedures for an auction that allows other qualified bidders to submit higher or otherwise better offers, as required under Section 363 of the U.S. Bankruptcy Code. Following completion of the bidding process, final approval of the U.S. Bankruptcy Court will be required. Scrubs & Beyond intends to acquire a substantial number of Life Uniform's retail stores, operated under the Life Uniform and Uniform City brand names, in addition to the Life Uniform and Uniform City websites, which Scrubs & Beyond would continue to operate post-acquisition. Karla Bakersmith, President and CEO of Scrubs & Beyond, said, "I spent nearly 13 years with Life Uniform before starting Scrubs & Beyond and I am excited by the business prospects made possible by the proposed acquisition. This is an exciting opportunity for Scrubs & Beyond to expand its retail footprint and provide greater support for outside sales, a rapidly growing part of our business, and a strategic imperative for our future." Bakersmith added, "The most exciting part of this acquisition is the opportunity for Scrubs & Beyond to become the largest retailer in our industry and to continue to innovate, offer new and unique products, and set the standard for great customer service." Genesis Capital, LLC is acting as investment banker and Ballard Spahr LLP is providing legal counsel to Scrubs & Beyond. Morgan Joseph TriArtisan LLC is acting as investment banker and Klehr Harrison Harvey Branzburg LLP is providing legal counsel to Life Uniform. Robert Frezza of Capstone Advisory Group, LLC has been engaged by Life Uniform to serve as its Chief Restructuring Officer during the bankruptcy process. Life Uniform will hold an auction if the Company receives additional qualified bids. Interested parties should contact Morgan Joseph TriArtisan LLC at 404.585.2200. About Life Uniform, Inc. Life Uniform -- http://www.lifeuniform.com-- is the country's largest retailer of healthcare apparel, scrubs, medical uniforms, nursing scrubs, nursing uniforms, hospital scrubs, nurses shoes, Cherokee scrubs, Barco Uniforms, lab coats, Landau scrubs, maternity scrubs, medical uniforms, nursing uniforms and supplies, Life Uniform, healthcare uniforms, nurses scrubs and medical apparel. Bloomberg discloses that Brentwood, Missouri-based Scrubs & Beyond has 27 stores in 14 states. St. Louis-based Life Uniform's stores are in 34 states. Although specific dates aren't selected, Life Uniform wants competing bids and an auction in July. According to Bloomberg, Capital Source is providing a $15 million loan for the bankruptcy that would bring in $4 million in addition liquidity. Life Uniform blamed financial problems on a lack of capital. LIFE UNIFORM: Case Summary & 30 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Life Uniform Holding Corp. 2132 Kratky Road St. Louis, MO 63114 Bankruptcy Case No.: 13-11391 Affiliates that simultaneously filed for Chapter 11: Debtor Case No. ------ -------- Healthcare Uniform Company, Inc. 13-11392 Uniform City National, Inc. 13-11393 Chapter 11 Petition Date: May 29, 2013 Court: U.S. Bankruptcy Court District of Delaware (Delaware) Debtors' Counsel: Domenic E. Pacitti, Esq. KLEHR HARRISON HARVEY BRANZBURG, LLP 919 Market Street, Suite 1000 Wilmington, DE 19801 Tel: (302) 552-5511 Fax: (302) 426-9193 E-mail: dpacitti@klehr.com Debtors' Claims and Noticing Agent: EPIQ BANKRUPTCY SOLUTIONS Debtors' Financial Advisor: CAPSTONE ADVISORY GROUP, LLC Lead Debtor's Estimated Assets: $10,000,001 to $50,000,000 Lead Debtor's Estimated Debts: $10,000,001 to $50,000,000 The petitions were signed by Bryan Graiff, COO, CFO, VP, secretary, and treasurer. Debtors' Consolidated List of Its 30 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Angelica Unsecured Note $7,244,855 7700 Forsyth Boulevard, Suite 1010 St. Louis, MO 63105 Sun Uniforms, LLC Unsecured Note $4,323,509 5200 Town Center Circle, Suite 600 Boca Raton, FL 33486 Strategic Partners, Inc. Trade $4,207,145 9800 De Sota Avenue Chatsworth, CA 91311 Creative In Design Resources, Inc. Trade $3,175,847 11625 Columbia Center Drive, Suite 200 Dallas, TX 75229 Sun Uniforms Finance, LLC Unsecured Note $2,377,921 5200 Town Center Circle, Suite 600 Boca Raton, FL 33486 Barco of California Trade $1,626,380 350 W. Rosecrans Avenue Gardenia, CA 90248 Koi Design, LLC Trade $712,098 1757 Stanford Street Santa Monica, CA 90404 White Cross Canada Trade $652,156 9600 Meilleur, #950 Quebec, QC Canada H2N 2E3 Baum Textile Mills, Inc. Trade $628,996 812 Jersey Avenue Jersey City, NJ 07310 White Swan/Meta Trade $465,471 621 Macon Street McDonough, GA 30253 Independence Medical Trade $397,245 9 Industrial Road Milford, MA 01757 Dansko Trade $387,948 8 Federal Road West Grove, PA 19390 Krazy Kat Sportswear, LLC Trade $338,864 1707 Broadway, Suite 221 New York, NY 10018 Peaches Uniforms Trade $278,825 1901 Hutton Court, Suite #200 Farmers Branch, TX 75234 Landau Uniform Shoes Trade $239,736 Pacific Tri-Port Distribution, Trade $132,808 Inc. Quagga Accessories, LLC Trade $124,375 Peppergate Footwear Trade $115,777 Sofft Shoe Company Trade $108,227 ADC Trade $95,653 Sterling Factors Corp. Trade $71,188 Latitudes, Inc. Trade $50,915 Iguanamed, LLC Trade $41,647 Prestige Medical Trade $39,055 Soncentric Sourcing Trade $33,763 Fame Fabrics, Inc. Trade $30,490 Digital Evolution Group Trade $30,328 Timberland, LLC Trade $29,392 Toshiba Global Commerce Solutions, Trade $17,808 Inc. Brown Group, Inc. Trade $17,808 LIFECARE HOLDINGS: Settlement for Unsecured Creditors Approved -------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that creditors of hospital owner LifeCare Holdings Inc. received court approval for a settlement allowing the business to be sold to senior lenders in exchange for $320 million in secured debt. According to the report, approved by the bankruptcy court in Delaware on May 28, the settlement gives $1.5 million cash to general unsecured creditors other than subordinated note holders. The report shares that in addition, the settlement ensures that unsecured creditors won't be sued for return of payments received in weeks before bankruptcy. Unsecured creditors estimate they will have a 7.5 percent cash recovery thanks to the settlement. The report notes that the settlement gives $2 million cash to subordinated noteholders, for a 1.7 percent recovery. They receive less than general unsecured creditors as a consequence of a subordination agreement with senior lenders. The senior lenders are providing another $150,000 for the creditors' lawyers. The bankruptcy court in Delaware approved the sale to the lenders in April, on the assumption that the settlement would be approved later. There were no bids to compete with the offer from the lenders, who were owed about $355 million on a secured credit facility with JPMorgan Chase Bank NA as agent. About LifeCare LCI Holding Company, 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% of the stock following a $570 million acquisition in August 2005. LCI Holding Company, Inc., 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. Huron Management Services LLC will provide the Debtors an interim chief financial officer and certain additional personnel; and (ii) designate Stuart Walker as interim chief financial officer. 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. LifeCare Hospitals of Pittsburgh, LLC, a debtor-affiliate disclosed $24,028,730 in assets and $484,372,539 in liabilities as of the Chapter 11 filing. The Official Committee of Unsecured Creditors is represented by Pachulski Stang Ziehl & Jones LLP. FTI Consulting, Inc., serves as its financial advisor. LINN ENERGY: S&P Retains 'B+' CCR on CreditWatch Positive --------------------------------------------------------- Standard & Poor's Ratings Services said that its ratings on Houston-based Linn Energy LLC, including the 'B+' corporate credit rating, will remain on CreditWatch with positive implications, where S&P placed them on Feb. 22, 2013. "The ratings on Linn Energy remain on CreditWatch due to the potential for an upgrade following its $4.3 billion acquisition of Berry Petroleum, including the assumption of about $1.7 billion debt," said Standard & Poor's credit analyst Paul Harvey. Acquiring Berry will materially strengthen Linn's business risk profile, raising proved reserves to an estimated 6.5 trillion cubic feet equivalent, strengthening its current core areas, and giving Linn a new core area in the Uinta Basin in Utah. The CreditWatch placement reflects the potential for a one-notch upgrade to 'BB-' from 'B+' and the potential for a higher rating on Linn's unsecured debt, pending an assessment of the resulting capital structure after the acquisition closes. S&P expects to resolve the CreditWatch placement near the close of the acquisition. LSP MADISON: Moody's Rates $450MM Sr. Secured Term Loan 'Ba3' ------------------------------------------------------------- Moody's Investors Service has assigned a Ba3 rating to LSP Madison Funding, LLC's $450 million senior secured term loan B due July 2020. The outlook is stable. Ratings Rationale: The assigned Ba3 rating reflects predictable contracted gross margins of over 65% through mid-2017 derived principally from capacity payments, reactive power tariff and black start revenue at three peaking units as well as contracted energy and capacity revenue through a partial interest in a run-of-the-river hydro facility. The rating also incorporates a view that the capacity market regime will continue and that each successive year provides additional clarity on future cash flow as most capacity auction revenue is determined via auction three years in advance. However, capacity markets are also fickle and the latest 2016/2017 capacity auction result in PJM highlighted how unpredictable auction results can be, even if they provide forward-looking clarity on potential future cash flows. Under various sensitivities considered by Moody's, the portfolio generates financial metrics such as the debt service coverage ratio (DSCR) consistent with a Ba-rating sub-factor under Moody's Power Generation Projects Methodology (the Methodology) and leverage metrics such as the funds from operations to debt ratio (FFO/Debt) consistent with a B-rating sub-factor under the Methodology. The Ba3 rating also recognizes substantial cash flow concentration and peaking units that provide uncertain energy margins, and the monetization of assets for which the cash flow stream post cleared capacity period (May 2017) remains highly uncertain. Proceeds of the new term loan will be used to partially refinance a $475 million term loan currently in place with the issuer. The remaining funds used to fully repay this term loan represent proceeds from the May 16, 2013 sale of the Blythe combined cycle asset, a fully contracted asset, and the proceeds expected from a separate stand-alone financing on the Cherokee Qualifying Facility, a contracted asset. Madison expects to receive net disposition amount of approximately $100 million from the sale/removal of these assets from the existing term loan facility. After fees and expenses, the borrower is expected to make a distribution as a result of this new term loan issuance. Moody's will withdraw the Ba2 rating on LSP Madison's existing $475 million outstanding term loan (cusip: 50217CAB3) upon the closing of the new term loan and subsequent repayment of the existing term loan. The Ba3 rating on the new Madison Funding term loan represents a substantial level of cash flow concentration with over 30% of expected future cash flow derived from the Safe Harbor hydro facility. The Madison Funding portfolio has evolved from eight to four generating projects over the last year with meaningfully less cash flow, electricity market, and asset diversification. The portfolio now consists of three peakers, two located in the Chicago area (PJM RTO) and one located in Wallingford, CT (NEISO CT) in addition to the hydro unit near Lancaster, PA (PJM MAAC). Even with expected plant retirements continuing, slack demand in their respective markets causes us to believe the three peakers are unlikely to generate meaningful merchant energy revenue and will continue to operate near their historical capacity factors. Moody's further notes that the contractual cash flow for energy at Safe Harbor is expiring in the next two years and while Moody's believes there is a reasonable likelihood of a replacement contract, the energy margins under a replacement contract will be negatively influenced by the region's access to shale natural gas and somewhat tepid demand. The rating recognizes the sponsor's active involvement to implement commercial enhancements across the portfolio. At Safe Harbor, both the sponsor and their co-owners of the facility are working on an optimization plan that is expected to reduce capex and result in stronger cash flow. Moody's also observes that incremental cash flow that the Wallingford peaking unit is expected to earn given increased requirements to procure certain ancillary services (AS) revenue, such as Locational Forward Reserve Market (LFRM), as proposed by the Independent System Operator of New England (ISONE) and approved by the Federal Energy Regulatory Commission (FERC). The market is limited in terms of size and types of units eligible to provide this product. Since Wallingford utilizes quick-start GE LM6000 Sprint technology and is relatively new, it is expected to capture more LFRM revenue. LFRM is a seasonal product and can fluctuate. For example, in the last auction LFRM cleared at $0.35 per kilowatt month above the FCM capacity price; the latest auction result was nearly ten times higher at approximately $3.00 per kilowatt month above the FCM capacity price. The portfolio continues to have some standard project finance features including 100% first priority security interest in the assets and associated contracts; a trustee-administered cash-flow waterfall of accounts and a 100% excess cash flow sweep. Positively, the portfolio benefits from a sponsor-provided, 6- month debt service reserve and major maintenance reserve fund. Flexibility around asset sales (except for Safe Harbor, which is prohibited from being sold under the financing agreements) exist in the proposed structure, enabling the issuer to sell any and all of the three peakers but only applying a predetermined amount to Madison Funding debt reduction. Moody's considers this aspect to be largely credit neutral with modest improvement in financial metrics in later years based upon sensitivities examined by us. Moody's further notes that issuer has the ability to increase the debt facilities by an incremental $25 million without rating affirmation and as such, its rating assumes that this incremental debt will be incurred. The stable outlook reflects near-term predictability of cash flows from the known capacity auctions across the portfolio and existing contracts at Safe Harbor, expectations for strong operating performance, and a reasonable high likelihood of debt reduction over the life of the term loan given the 100% excess cash sweep and Moody's view that capacity market regimes will continue. The rating could be revised upward if the borrower implemented meaningful contracts on the non-contracted portion of the portfolio resulting in substantially higher predictable cash flows and improved cash flow metrics in the "Baa" category or if debt reduction occurs at levels significantly higher than scenarios considered by Moody's. The rating could face downward pressure should projects fail to perform as expected which lowers cash flow metrics including consolidated FFO/Debt falling below 10% or debt service coverage falling below 2.0x on a sustained basis. The ratings are predicated upon final documentation in accordance with Moody's current understanding of the transaction and final debt sizing consistent with initially projected credit metrics and cash flows. LSP Madison Funding, LLC (Madison Funding) consists of four generating projects comprised of three peaking units and a partial interest in a run-of-the river hydro facility totaling approximately 1,263 megawatts (MW) based on average winter and summer rating capacity. The peaking units include the nominally rated 540 MW University Park North (UPN) and 300 MW University Park South (UPS) units in Chicago, IL; and the 225 MW Wallingford unit in Wallingford, CT. The 417 MW Safe Harbor hydro facility (139 MW net ownership) is located on the Susquehanna River near Lancaster, PA. The peaking units have at least ten years of operating history and are run by recognized operators in NAES and Wood Group. The hyrdo facility has been in place since the 1930s with an expansion undertaken in the mid-1980s. Madison Funding is wholly owned by LSP Madison Holdings, which is in turn owned by a $3.1 billion private equity fund (the Fund) managed by LS Power Group (LSP). LSP currently owns and manages twenty fossil and renewable power generation assets with over 8,500 MW of capacity and two large scale electric transmission businesses. The principal methodology used in this rating was the Power Generation Projects Methodology published in December 2012. MAIN STREET: Daily Voice Auction Set for June 20 ------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Daily Voice, the owner of a news website for 41 communities in Westchester County, New York, and Fairfield County, Connecticut, will be sold to the founder and two shareholders for $800,000, mostly in exchange for debt, absent a better offer at a June 20 auction. Under sale procedures approved May 29 by the U.S. Bankruptcy Court in White Plains, New York, competing bids are due June 17. There will be a hearing on June 21 to approve the sale. The Bloomberg report discloses that founder Carll Tucker and two shareholders will be the buyers, assuming there is no better offer at auction. They are offering $100,000 cash while taking ownership in exchange for $550,000 in pre-bankruptcy secured debt and $150,000 in financing for the Chapter 11 effort. About Main Street Main Street Connect LLC, the owner of the Daily Voice news website for 41 communities in Westchester County, New York, and Fairfield County, Connecticut, filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 13-22729). The business disclosed assets of $395,000 and liabilities totaling $877,000, including $550,000 in secured debt. Daily Voice was facing a lawsuit by workers alleging violation of the federal Fair Labor Standards Act. The lawsuit, which is pending, had cost $500,000 in fees and precluded raising more financing. MFM INDUSTRIES: Meeting to Form Creditors' Panel on June 6 ---------------------------------------------------------- Roberta A. DeAngelis, the United States Trustee for Region 3, will hold an organizational meeting on June 6, 2013, at 10:00 a.m. in the bankruptcy case of MFM Delaware, Inc. The meeting will be held at: J. Caleb Boggs Federal Building 844 King Street, Room 5209 Wilmington, DE 19801 The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' case. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. About MFM Industries Cat litter maker MFM Delaware, Inc., and affiliate MFM Industries, Inc. sought Chapter 11 protection (Bankr. D. Del. Case No. 13- 11359 and 13-11360) on May 28, 2013. Founded in 1964 as a clay-based absorbents supplier, MFM is supplier of cat litter in the U.S. The company produces 100,000 tons of cat litter a year, representing 1 percent of the total market. Its private label market share is 20 percent. The company's cat litter products are comprised of a blend of fuller's earth clay, sodium bentonite and scenting properties. Clay is supplied from a leased clay mine in Ocala, Florida, and is transported five miles away to the company's manufacturing plant in Reddick, Florida. Direct Capital Partners, LLC, acquired a majority stake in the company in 1997. The Rosner Law Group LLC serves as counsel to the Debtor. MOBILE MINI: S&P Revises Outlook to Positive & Affirms 'BB-' CCR ---------------------------------------------------------------- Standard & Poor's Ratings Services said that it revised its outlook on Tempe, Ariz.-based portable storage units and mobile office units leasing company Mobile Mini Inc. to positive from stable. S&P affirmed the 'BB-' corporate credit rating. At the same time, S&P affirmed its 'B+' rating (one notch below the corporate credit rating) on the senior unsecured notes. The '5' recovery rating, indicating S&P's expectations that lenders would receive a modest (10%-30%) recovery in the event of a payment default, is unchanged. "Mobile Mini's financial profile has been improving gradually, and we expect that to continue," said Standard & Poor's credit analyst Funmi Afonja. The company's financial profile has benefited from a debt paydown, reduced capital spending, and increasing earnings. For the quarter ended March 31, 2013, utilization averaged 60.2% compared with 56.8% in the prior-year period, and approached the five-year historical average of 60.6%. At the same time, the company achieved modest lease rate gains. As a result, revenues grew by about 6% and EBITDA margins improved to 40.5%, compared with 38.9% in the prior year. S&P expects that the combination of improving operating performance and continued debt repayment should help Mobile Mini achieve a gradually improving financial profile over the next year. "In our base-case scenario, we expect EBITDA margins to only improve modestly, despite increased revenues, due to additional expenses from adding new "greenfield" locations and the repair and deployment of more units. Greenfield locations are low-cost, start-up operational yards where the company redeploys idle fleet. Although Mobile Mini has not made any shareholder rewards in recent years, our base-case scenario leaves room for modest shareholder rewards through dividends and share buybacks of $20 million per year. Our assumptions take into account the company's strong positive cash flow generation, limited capital spending needs and no debt maturities till 2017. As of March 31, 2013, funds flow from operations (FFO) to lease-adjusted debt was 19.9%, EBITDA margin was 40.5%, and lease-adjusted debt to capital was 45% (low for a leasing company)," S&P said. S&P's base-case scenario generates the following credit measures over the next year: -- Funds flow from operation (FFO) to total debt in the high- teens percent area, -- EBITDA margins in the low-40% area, and -- Fully adjusted (for operating leases) total debt to capital in the low-40% area. The ratings on Mobile Mini reflect the cyclicality of many markets served by its leasing and sale of portable storage units and mobile office units--a fairly narrow business segment. Positive rating factors include the company's leading market position and relatively stable earnings and cash flow. Although Mobile Mini is exposed to the near-term economic weakness in Europe and the U.S., S&P expects earnings should be relatively stable due to moderate contract coverage. Standard & Poor's categorizes Mobile Mini's business risk profile as "fair," its financial risk profile as "aggressive," its liquidity as "adequate," and management as "fair" under S&P's criteria. The outlook is positive. S&P expects the company to achieve a gradually improving financial profile from continued earnings growth, debt paydown, and keeping capital spending reduced. Over the long-term, S&P expects Mobile Mini to benefit from improving market fundamentals. S&P could upgrade the company by one notch if its financial profile improves such that FFO to debt rises to the 20% area on a sustained basis and EBITDA margins increase to the low-40% area on a sustained basis. S&P could revise the outlook to stable if the company's financial profile moderates due to weaker-than-expected earnings growth or material shareholder rewards, causing FFO to total debt to fall to the mid-teen area for a sustained period. However, S&P expects the company's financial measures will improve in 2013 and beyond. MTS LAND: Mediation This Week; Confirmation Hearing Moved to Aug. ----------------------------------------------------------------- The Hon. Eileen W. Hollowell of the U.S. Bankruptcy Court for the District of Arizona signed off on a stipulation continuing the confirmation hearing for MTS Land LLC's Chapter 11 Plan, and modifying the confirmation hearing deadline. The stipulation, entered between the Debtor and US Bank, N.A., provides that: 1. the confirmation hearing scheduled for June 24, 25, 26, 27 and 28 will be continued to a date to be determined in August, or as soon as practicable thereafter, subject to the Court's availability; 2. the parties will attend mediation during the week of June 3, or as soon as practicable thereafter; 3. the parties will each have representatives available at mediation with authority to settle, or immediately available by telephone; 4. these dates set forth in the Disclosure Statement order will remain unchanged: a. Record Date for Voting Purposes -- April 1; b. Deadline to File Notice of Development Path -- April 19; c. Deadline to file Motion in Support of Plan Confirmation -- April 25; d. Deadline to File Notice Identifying Legal Issues -- May 3; e. Voting Deadline -- May 14; f. Deadline to File Ballot Summary -- May 17; g. Deadline to File Blind Briefs (except as to the USB Issues) -- May 20. 5. these dates set forth in the Disclosure Statement Order and related to the confirmation hearing will be reset by the parties after a new Confirmation hearing is set: a. Deadline to file objections to confirmation; b. Deadline to file blind briefs (on USB Issues); c. Discovery deadlines. Gerald M. Gordon, Esq., Robert C. Warnicke, Esq., and Teresa M. Pilatowicz, Esq., at Gordon Silver, represent the Debtor. 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, Cal.-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 Plan filed in the Debtors' cases provides that all creditors with allowed claims will be paid the amount of their allowed claims in full through the Plan. Holders of equity securities of Debtors will retain all of their legal interests. 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. MUD KING: U.S. Trustee Unable to Appoint Creditors Committee ------------------------------------------------------------ Judy A. Robbins, U.S. Trustee for Region 7, notified the Bankruptcy Court for the Southern District of Texas that she was unable to appoint a committee of unsecured creditors in the Chapter 11 case of Mud King Products, Inc. The U.S. Trustee said that she has attempted to solicit creditors interested in serving on the unsecured creditors' committee but was unable to solicit sufficient interest to appoint a proper committee. About Mud King Mud King Products, Inc., filed a Chapter 11 petition (Bank. S.D. Tex. Case No. 13-32101) on April 5, 2013. The petition was signed by Erich Mundinger as vice president. The Debtor disclosed $18,959,158 in assets and $3,351,216 in liabilities as of the Chapter 11 filing. Hoover Slovacek, LLP, serves as the Debtor's counsel. Judge Karen K. Brown presides over the case. MUD KING: Muskat Martinez Approved as Special Litigation Counsel ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Texas authorized Mud King Products, Inc., to employ Suzanne Lehman Johnson of Muskat, Martinez & Mahony LLP as special litigation counsel. As reported in the Troubled Company Reporter on May 20, 2013, the Debtor related that the firm represented it in litigation for misappropriation of trade secret and related actions which was initiated in Harris County District Court. The Debtor has denied the allegations in the litigation and it remains pending, but the claims against the Debtor have been stayed due to the bankruptcy filing. The firm will, among other things: a) represent the Debtor in the case styled National Oilwell Varco v. Mud King Products, L.L.C. et al., pending in the U.S. District Court for the Southern District of Texas; b) defend the Debtor in the litigation and assist, advise, investigate, file and prosecute counter claims of the Debtor related to the litigation; c) assist with the estimation and litigation of the National Oilwell Varco's claim in the main bankruptcy case. The hourly rates of the firm's personnel are: Suzanne Lehman Johnson $350 Gabrielle Moses $250 Paralegals/Legal Assistants $75 - $125 To the best of the Debtor's knowledge, the firm does not represent any interest adverse to the Debtor or its estate with respect to the matters on which counsel will be employed. About Mud King Mud King Products, Inc., filed a Chapter 11 petition (Bank. S.D. Tex. Case No. 13-32101) on April 5, 2013. The petition was signed by Erich Mundinger as vice president. The Debtor disclosed $18,959,158 in assets and $3,351,216 in liabilities as of the Chapter 11 filing. Hoover Slovacek, LLP, serves as the Debtor's counsel. Judge Karen K. Brown presides over the case. The U.S. Trustee was unable to appoint an official committee of unsecured creditor. MUNICIPAL CORRECTIONS: CohnReznick LLP Approved as Auditor ---------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Georgia authorized Municipal Corrections LLC to employ CohnReznick, LLP to audit its books and record, as required under the trust indenture with UMB Bank, N.A., and related agreement. According to the Debtor, the services of the firm will be limited to an audit of the combined balance sheet of the Debtor and its affiliate, Irwin County Detention Center, LLC, as of Dec. 31, 2012, and the related combined statements of income, retained earning and cash flows of the year then ended. The Debtor agreed to pay the firm a flat fee of $30,000. The firm attests it is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Municipal Corrections Hamlin Capital Management, LLC, Oppenheimer Rochester National Municipals, and UMB, N.A., as indenture trustee -- owed an aggregate $90 million on a bond debt -- filed an involuntary Chapter 11 petition for Municipal Corrections, LLC (Bankr. D. Nev. Case No. 12-12253) on Feb. 29, 2012. Jon T. Pearson, Esq., at Ballard Spahr LLP, in Las Vegas, Nevada, serves as counsel to the petitioners. In August, the bankruptcy judge ruled that the prison is properly in Chapter 11 to reorganize. Austin E. Carter, Esq., at Stone & Baxter LLP, in Macon, Ga.; and Lenard E. Schwartzer, Esq., at Schwartzer & McPherson Law Firm, in Las Vegas, Nevada, represent the Debtor as counsel. The Debtor disclosed $656,378 in assets and $61,769,528 in liabilities as of the Chapter 11 filing. As reported by the TCR on Jan. 3, 2013, Bankruptcy Judge Thad J. Collins granted the request of creditor Irwin County to transfer the venue of the Debtor's Chapter 11 bankruptcy case to the U.S. Bankruptcy Court for the Northern District of Georgia. No committee was appointed in the case. MURR'S AUTO: Case Summary & 6 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Murr's Auto Body 61 W. 2nd Street Atlantic Beach, FL 32233 Bankruptcy Case No.: 13-03287 Chapter 11 Petition Date: May 29, 2013 Court: U.S. Bankruptcy Court Middle District of Florida (Jacksonville) Judge: Jerry A. Funk Debtor's Counsel: Robert W. Elrod, Jr., Esq. ROBERT W. ELROD, P.A. 233 East Bay Street Suite 1032 Jacksonville, FL 32202 Tel: (904) 356-1282 E-mail: rwelrod2@aol.com Scheduled Assets: $1,374,400 Scheduled Liabilities: $1,027,145 The Company?s list of its six largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/flmb13-03287.pdf The petition was signed by John Murr, owner. NATIONAL GOLD: Chancery Court Sides With Israel Discount Bank ------------------------------------------------------------- The Court of Chancery of Delaware issued a ruling in an action arising out of a dispute over the handling of collateral for a $10 million loan consisting of rare coins and bullion. The primary lender, Israel Discount Bank of New York, lent money to its client, Republic National Business Credit LLC, as part of a revolving credit agreement. The client, in turn, issued loans to various entities, including National Gold Exchange, Inc., and took an interest in collateral for those loans. The New York bank had an interest in this collateral as a result of its security interest in its client's assets. Ultimately, the New York bank's client requested that the collateral be transferred to a specific depository -- First State Depository, LLC -- that offered better pricing. The New York bank, its client, and the depository signed an agreement requiring that, upon receiving written notice from the New York bank, the depository thereafter would refrain from releasing the collateral without the written authorization of the New York bank. The depository also agreed to allow the New York bank to inspect and remove the collateral on demand. Despite adequate notice of the New York bank's exercise of its right to approve any transfers by the depository, the depository continued, without consulting the bank, to release the collateral to a debtor company with the same owner as the depository. A large amount of the collateral was not returned to the depository, and the New York bank claims to have suffered damages due to its resulting under-securitization. Israel Discount Bank now seeks damages based on the unauthorized release of collateral by the depository and the conversion of collateral by the related company. The depository and related company have asserted a legion of defenses. They include that Israel Discount Bank's claims are barred by laches, the doctrine of election of remedies, and the invocation of an indemnification and hold harmless provision in a separate agreement. Both sides also contend that they are entitled to an award of attorneys' fees as a result of their adversary's bad faith and vexatious litigation conduct. National Gold Exchange, one of Republic's significant borrowers, filed for Chapter 11 bankruptcy on July 24, 2009. In a May 29 Memorandum Opinion available at http://is.gd/bjUujb from Leagle.com, Vice Chancellor Donald F. Parsons Jr., held that the depository breached the agreement by releasing collateral and interfering with the New York bank's consent, inspection, and removal rights. The Court also held that the affiliated debtor converted collateral by impermissibly possessing and disposing of collateral as if it were its own. The depository and affiliated company's conduct both before and during the litigation was sufficiently egregious to justify an award against them of Israel Discount Bank's reasonable attorneys' fees and expenses. "I find in favor of IDB. Specifically, I find that FSD breached the Bailment Agreement by, among other things, releasing the Collateral and interfering with IDB's rights under that agreement. I also find that CAMI converted the Collateral by wrongfully possessing and disposing of the Collateral as if it were its own," Vice Chancellor Parsons said." "I direct that judgment be entered against FSD and CAMI, jointly and severally, in the amount of $7,091,903.57 plus prejudgment interest from September 12, 2011 at the legal rate, compounded monthly. IDB also is entitled to the return of the $25,000 that it posted in support of the TRO it obtained. Finally, IDB is entitled to an award of its attorneys' fees and expenses for prosecuting this action, including, without limitation, its costs under Rule 54(d)." The case is, ISRAEL DISCOUNT BANK OF NEW YORK, Plaintiff, v. FIRST STATE DEPOSITORY COMPANY, LLC and CERTIFIED ASSETS MANAGEMENT, INC., Defendants, Civil Action No. 7237-VCP (Del. Ch.). First State Depository is a private depository that provides specialized precious metals custody, shipping, and accounting services. Certified Assets Management, Inc., is a Delaware corporation that offers wholesale rare coin and marketing services. Robert Higgins, a non-party, owns both FSD and CAMI. He is FSD's sole member and CAMI's president and sole stockholder. Eric Higgins, also a non-party and Higgins's son, is the head of customer service at FSD. Another of Higgins's sons, Steven Higgins, worked at CAMI and served as CAMI's corporate designee. Israel Discount Bank of New York is represented by: Paul D. Brown, Esq. Joseph B. Cicero, Esq. Stephanie S. Habelow, Esq. COUSINS CHIPMAN & BROWN, LLP Wilmington, DE E-mail: brown@ccbllp.com cicero@ccbllp.com habelow@ccbllp.com Attorneys for Defendants are: Beth Moskow-Schnoll, Esq. David A. Felice, Esq. BALLARD SPAHR LLP Wilmington, DE Tel: 302-252-4447 Fax: 302-252-4466 E-mail: moskowb@ballardspahr.com feliced@ballardspahr.com Tampa, Florida-based National Gold Exchange, Inc., operates a gold and silver rare coin wholesaler. The Company filed for Chapter 11 bankruptcy protection on July 24, 2009 (Bankr. M.D. Fla. Case No. 09-15972). Richard J. McIntyre, Esq., at McIntyre, Panzarella, Thanasides & Eleff, assists the Company in its restructuring effort. The Company listed $10 million to $50 million in assets and $50 million to $100 million in debts. NATURAL PORK: Panel Can Hire Cutler Law Firm as Associate Counsel ----------------------------------------------------------------- The Official Committee of Unsecured Creditors in Natural Pork Production II, LLP's bankruptcy case, sought and obtained court permission to retain Cutler Law Firm, P.C., as its associate counsel. The Court approved the Committee's retention of Sugar, Felsenthal, Grais & Hammer L.P. as its lead counsel by order dated October 31, 2012, effective as of September 26, 2012. The Committee wants to employ Cutler Law Firm, P.C., Attorneys at Law, and specifically, Robert C. Gainer, as Associate Counsel for the Committee in the Bankruptcy Case. As Associate Counsel working with SugarFGH on behalf of the Committee in the chapter 11 case, Cutler's responsibilities will include, as needed: a. The administration of these cases and the exercise of oversight with respect to the Debtors' affairs, including all issues in connection with the Debtors, the Committee or these chapter 11 cases; b. The preparation on behalf of the Committee of necessary applications, motions, memoranda, orders, reports and other legal papers; c. Appearances in Court, participation in litigation as a party-in-interest, and attendance at meetings to represent the interests of the Committee; d. Communications with the Committee's constituents and others at the direction of the Committee in furtherance of its responsibilities, including, but not limited to, communications required under section 1102 of the Bankruptcy Code; and e. The performance of all of the Committee's duties and powers under the Bankruptcy Code and the Bankruptcy Rules and the performance of such other services as are in the interests of those represented by the Committee. Robert C. Gainer's hourly rate is $250. Cutler attests it represents no interest adverse to the Committee in the matters upon which it is to be engaged. About Natural Pork Hog raiser Natural Pork Production II, LLP, filed for Chapter 11 bankruptcy (Bankr. S.D. Iowa Case No. 12-02872) on Sept. 11, 2012, in Des Moines. The Company formerly did business as Natural Pork Production, LLC. It does business as Crawfordsville, LLC, Brayton, LLC, South Harlan, LLC, and North Harlan, LLC. The Debtor disclosed $31.9 million in asset and $27.9 million in liabilities, including $7.49 million of secured debt in its schedules. Bankruptcy Judge Anita L. Shodeen oversees the case. Donald F. Neiman, Esq., and Jeffrey D. Goetz, Esq., at Bradshaw, Fowler, Proctor & Fairgrave, P.C., in Des Moines, Iowa, represent the Debtor as general reorganization counsel. John C. Pietila, Esq., at Davis, Brown, Koehn, Shors & Roberts, P.C., in West Des Moines, Iowa, represents the Debtor as special corporate counsel, effective as of the Petition Date. Aaron L. Hammer, Esq., Mark S. Melickian, Esq., and Michael A. Brandess, Esq., at Sugar, Felsenthal Grais & Hammer LLP, in Chicago, represent the Official Committee of Unsecured Creditors. Conway MacKenzie, Inc., serves as its financial advisor. Gary W. Koch, Esq., and Michael S. Dove, Esq., represent AgStar Financial Services, ACA, and AgStar Financial Services, FLCA, as counsel. Michael P. Mallaney, Esq., at Hudson Mallaney Schindler & Anderson, in West Des Moines, Iowa, represents the IC Committee as counsel. NATURAL PORK: Exclusive Plan Filing Extended Until Sept. 9 ---------------------------------------------------------- The Hon. Anita L. Shodeen of the U.S. Bankruptcy Court for the Southern District of Iowa has granted Natural Pork Production II LLP's request to extend its exclusive period to file a reorganization plan until Sept. 9, 2013. As reported by the Troubled Company Reporter on Feb. 5, 2013, the Debtor said there are two pending adversary proceedings in the case that render it somewhat difficult to propose a plan at this time, and that on Dec. 7, 2012, four wholly owned subsidiaries of the Debtor filed their own individual Chapter 11 cases. The Debtor says that while these cases are not currently jointly administered with its case, serious consideration needs to be given to the status and future of those cases, in connection with its preparing and filing a disclosure statement and plan. About Natural Pork Hog raiser Natural Pork Production II, LLP, filed for Chapter 11 bankruptcy (Bankr. S.D. Iowa Case No. 12-02872) on Sept. 11, 2012, in Des Moines. The Company formerly did business as Natural Pork Production, LLC. It does business as Crawfordsville, LLC, Brayton, LLC, South Harlan, LLC, and North Harlan, LLC. The Debtor disclosed $31.9 million in asset and $27.9 million in liabilities, including $7.49 million of secured debt in its schedules. Bankruptcy Judge Anita L. Shodeen oversees the case. Donald F. Neiman, Esq., and Jeffrey D. Goetz, Esq., at Bradshaw, Fowler, Proctor & Fairgrave, P.C., in Des Moines, Iowa, represent the Debtor as general reorganization counsel. John C. Pietila, Esq., at Davis, Brown, Koehn, Shors & Roberts, P.C., in West Des Moines, Iowa, represents the Debtor as special corporate counsel, effective as of the Petition Date. Aaron L. Hammer, Esq., Mark S. Melickian, Esq., and Michael A. Brandess, Esq., at Sugar, Felsenthal Grais & Hammer LLP, in Chicago, represent the Official Committee of Unsecured Creditors. Conway MacKenzie, Inc., serves as its financial advisor. Gary W. Koch, Esq., and Michael S. Dove, Esq., represent AgStar Financial Services, ACA, and AgStar Financial Services, FLCA, as counsel. Michael P. Mallaney, Esq., at Hudson Mallaney Schindler & Anderson, in West Des Moines, Iowa, represents the IC Committee as counsel. NEIMAN MARCUS: Bank Debt Trades at 0.08% Off in Secondary Market ---------------------------------------------------------------- Participations in a syndicated loan under which Neiman Marcus Group Inc is a borrower traded in the secondary market at 99.92% cents-on-the- dollar during the week ended Friday, May 31, 2013, according to data compiled by LSTA/Thomson Reuters MTM Pricing and reported in The Wall Street Journal. This represents a drop of -0.67 percentage points from the previous week, the Journal relates. The loan matures May 16, 2018. The Company pays 300 basis points above LIBOR to borrow under the facility. The bank debt carries Moody's B2 rating and S&P's B+ rating. Neiman Marcus Group, Inc., headquartered in Dallas, Texas, operates 41 Neiman Marcus stores, 2 Bergdorf Goodman stores, 6 CUSP stores, 35 clearance centers, and a direct business. Total revenues are about $4.4 billion. NORTH AMERICAN BREWERIES: Moody's Changes Rating Outlook to Neg --------------------------------------------------------------- Moody's Investors Service affirmed North American Breweries' B2 CFR and changed the outlook to negative from stable. Rating Rationale The negative outlook reflects NAB's poor financial performance since the company was first rated in November, due to a number of factors including a lockout of the National Hockey League ("NHL") which hurt Labatt sales in the North East, de-stocking by wholesalers in anticipation and immediately after the Florida Ice & Farm Company's ("FIFCO") acquisition of the company, the cycling through of lost volume from one large contract manufacturing customer, and poor weather and difficult beer dynamics in the North American market which hurt volumes across the entire industry this winter, but particularly affected NAB because of its concentration in the north eastern states. These factors resulted in lower than expected shipments and a decline in both profitability and cash flow that drove leverage from an expected range in the mid 4 times area, to close to 7 times by the end of the first quarter. While Moody's expects improvements as the company heads into its peak selling months, and puts behind it the impact of one-time issues such as the NHL lockout and the wholesaler destocking, the lost earnings put the company behind original expectations in its ability to de-lever and also resulted in tight cushions under its bank financial covenants. Failure to restore credit metrics to levels closer to the levels that were originally expected within the next several quarters will lead to a downgrade. The CFR of B2 reflects the company's small scale and limited geographic diversity relative to large global brewers. NAB operates predominantly in the US, with pockets of regional strength aligned with its four breweries which are on the coasts, and a very light presence in the middle of the country. NAB's operating margins are thin due to portfolio mix and scale disadvantages relative to much larger peers. A meaningful amount of the company's volumes are from contract brewing which is not very profitable, while its' more profitable craft and flavored malt beverage brands currently represent a growing portion of the total portfolio. In addition, significant acquisition activity over the past few years has led to the creation of the portfolio as it exists today, so the longer term track record of managing brands which are strong in disparate regions of the country remains to be seen. EBITA margins fell from the high to mid-single digit range in recent quarters, and Moody's is concerned that increased competitive pressure on the fast growing Seagram Escapes category may restrict the company's ability to fully recover previous margins over the next 12-18 months, despite proactive cost cutting initiatives. While the company is small relative to other global, deep-pocketed brewers in the North American market, it has good growth prospects thanks to its portfolio of craft, Import, flavored malt beverages and other popular brands. In addition, Moody's believes that the new owner, Costa Rican based Florida Ice and Farm Co., which has its own interests in beer in Central America, can be considered more of a strategic owner than previous private equity owner KPS Capital Partners, a potential positive due to sharing of best practices and possible revenue synergies. The rating would be lowered if NAB failed to restore EBITA margins to the mid-to high single digit range or to lower debt to EBITDA to under 5.5 times by year-end, or if free cash flow remains negative in any of the next few quarters. Large debt financed acquisitions or shareholder returns could also result in a ratings downgrade. While unlikely at the current time, to achieve an upgrade, NAB will need to demonstrate its ability to profitably grow its business and generate consistent positive free cash flow to enable leverage reduction. Improving the profitability of its larger brands and growing the scale of certain smaller but more profitable brands would be a plus. Quantitatively, an upgrade would be considered if EBITA margin were to be sustained above 9% and leverage declined to under 4 times, while also increasing scale. The principal methodology used in this rating was the Global Alcoholic Beverage Rating Methodology published in September 2009. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in Rochester, NY, North American Breweries Holdings, LLC ("NAB") is an independent brewer of beer and other malt beverage products. Its portfolio of brands includes Genessee, Labatt brands in the US, Original Honey Brown Lager and Dundee Ales and Lagers, Seagram's Escapes, Magic Hat, Pyramid an Mac Tarnahans . NAB also performs contract brewing on behalf of other companies. The company posted sales of $419 million for the twelve months ended December, 2012. The company is now owned by Cerveceria Costa Rica S.A. ("CCR"), a subsidiary of Florida Ice and Farm Company ("FIFCO") a publicly traded holding company based in Costa Rica with interests in beer and other beverages as well as food , retail and other businesses. NV ENERGY: Fitch 'BB+' Long-term IDR on Rating Watch Positive ------------------------------------------------------------- Fitch Ratings has placed the ratings of NV Energy, Inc. (NVE) and its operating subsidiaries Nevada Power Company d/b/a/ NV Energy (NPC) and Sierra Pacific Power Company d/b/a/ NV Energy (SPPC) on Rating Watch Positive. The rating action reflects the planned acquisition of NVE by MidAmerican Energy Holdings Company (MEHC; Issuer Default Rating (IDR) 'BBB+'; Rating Outlook Stable). Fitch has also issued a separate press release discussing the affirmation of MEHC's ratings with a Stable Outlook. Please refer to Fitch's press release titled 'Fitch Affirms MidAmerican Energy Holdings Co.'s Ratings Following Acquisition Announcement' dated May 30, 2013. Approximately $5 billion of debt is affected by the rating action. Key Rating Drivers -- Completion of the proposed acquisition of NVE by MEHC; -- Greater financial flexibility as a result of the acquisition; -- A balanced regulatory environment in Nevada; -- Improving financial profile due to significant debt reduction; higher earnings and lower interest expense; -- Relatively low 2013 - 2015 capex following completion of NVE's major generation build cycle. On May 29, 2013, MEHC and NVE announced a definitive agreement in which MEHC will purchase all outstanding shares of NVE for $23.75 per share or $5.6 billion. The companies' boards of directors have unanimously approved the proposed transaction, which is also subject to shareholder approval. In addition, the transaction is subject to approval from federal and state regulators, including the Nevada Public Utilities Commission, the Federal Energy Regulatory Commission. The proposed acquisition is expected to close in the first quarter of 2014. Fitch believes that completion of the proposed acquisition of NVE by MEHC would likely result in a one-notch upgrade of NVE and its utility operating subsidiaries ratings. This view is supported by the anticipated increase in financial flexibility and lower funding costs that will accrue to the benefit of NVE and its constituents due to association with a larger, financially strong parent company. The proposed acquisition augments an already improving credit profile at NVE and its subsidiaries, in Fitch's opinion. Fitch upgraded the ratings of NVE and its subsidiaries on April 30, 2013. The rating action at that time cited improving consolidated credit metrics due to historic and anticipated debt reduction, a balanced regulatory environment in Nevada and slowly improving regional economic conditions. The credit rating upgrade also considered management's ongoing focus on utility operations in Nevada and a balanced regulatory compact. Fitch expects current NVE management, led by president and chief executive officer Michael Yackira, to remain at the helm under the proposed, new ownership structure. With completion of the proposed transaction, Fitch expects NVE will continue as an intermediate parent company to its Nevada operating utilities and wholly-owned subsidiary of MEHC. NPC and SPPC are expected to merge concomitant with completion of the On Line transmission project around the end of this year pending regulatory approvals. For further information regarding NVE and its operating subsidiaries, please refer to the Fitch press release titled 'Fitch Upgrades NV Energy & Subsidiaries Ratings; Outlook Stable' dated April 30, 2013. Rating Sensitivities An adverse change to the regulatory compact in Nevada could trigger future negative rating actions. Greater than anticipated debt reduction and/or a faster-than- expected economic recovery in Nevada could result in positive rating actions. Fitch has placed the following ratings on Rating Watch Positive: NVE -- Long-term IDR 'BB+'; -- Senior unsecured debt 'BB+'. NPC -- Long-term IDR 'BBB-'; -- Senior secured debt 'BBB+'; -- Short-term IDR F3. SPPC -- Long-term IDR 'BBB-'; -- Senior secured debt 'BBB+' -- Short-term IDR F3. NV ENERGY: S&P Puts 'BB+' Sr. Unsec. Rating on CreditWatch Pos. --------------------------------------------------------------- Standard & Poor's Ratings Services said it placed its 'BBB-' corporate credit ratings on NV Energy Inc., Nevada Power Co., and Sierra Pacific Power Co. on CreditWatch with positive implications. S&P has also placed its 'BBB+' senior secured ratings on Nevada Power Co. and Sierra Pacific Power Co. and S&P's 'BB+' senior unsecured rating on NV Energy Inc. on CreditWatch with positive implications. The CreditWatch placement reflects S&P's expectation that MidAmerican Energy Holdings Co., which is more highly rated, will maintain credit quality consistent with its current ratings following the acquisition. The acquiring company has significant scale and operating expertise to support this expectation and is likely to retain NV Energy management, which S&P deems to be credit supportive, due to management's recent efforts in improving regulatory relationships and key credit measures. The transaction is expected to be consummated by early 2014; this approximately corresponds with the timeframe for NV Energy's previously announced merger of the two utilities, Sierra Pacific Power Co. and Nevada Power Co. S&P expects that this merger will still be permitted to occur, and NV Energy will remain a separate subsidiary of MEHC, maintaining its headquarters in Las Vegas. The union is also expected to further NV Energy's stated goal of strengthening its commitment to renewable energy; this is an area in which MEHC has significant experience. The 'BBB-' corporate credit ratings on utility holding company NV Energy Inc. (NVE), regulated electric utility subsidiary Nevada Power Co. (NPC), and regulated electric and natural gas utility Sierra Pacific Power Co. (SPPC) are based on the consolidated credit profile. The credit profile reflects S&P's view of consistent management of numerous regulatory risks, offset by higher-than-average debt, historically low cash flows, a service area affected by the recession, and some exposure to natural gas. NVE provides electricity and gas in much of Nevada. "The CreditWatch placement indicates our belief that there is at least a 50% likelihood that the ratings of NV Energy and its subsidiaries will be raised during the next six months. We expect the acquisition of NVE by the higher-rated MidAmerican Energy Holdings Co., if completed as planned, to be supportive of an upgrade. We will resolve the CreditWatch status upon review of definitive information regarding the proposed transaction and upon achieving greater certainty that all conditions to reaching a successful close have been met," said Standard & Poor's credit analyst Michael Ferguson. ORMET CORP: Studying Details for Potential Chapter 11 Plan ---------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that while Ormet Corp. will be in bankruptcy court on June 3 giving ownership to lender and part owner Wayzata Investment Partners LLC in exchange for debt, the primary aluminum producer filed papers asking the bankruptcy judge in Delaware to extend its exclusive right to propose a Chapter 11 plan. According to the report, at a June 18 hearing, Ormet wants so called exclusivity pushed out by four months to Oct. 23. Ormet says it hasn't yet had the ability to analyze "in significant detail all issues related to a potential plan filing." There were no bids competing with the offer from Wayzata to buy the business in exchange for $130 million in secured debt plus the loan financing bankruptcy. Wayzata is financing the Chapter 11 case with a $30 million term loan and a $60 million revolving credit that replaced an existing facility. About Ormet Corp. Aluminum producer Ormet Corporation, along with affiliates, filed for Chapter 11 protection (Bankr. D. Del. Case No. 13-10334) on Feb. 25, 2013, with a deal to sell the business to a portfolio company owned by private investment funds managed by Wayzata Investment Partners LLC. Headquartered in Wheeling, West Virginia, Ormet -- http://www.ormet.com/-- is a fully integrated aluminum manufacturer, providing primary metal, extrusion and thixotropic billet, foil and flat rolled sheet and other products. Ormet disclosed assets of $406.8 million and liabilities totaling $416 million. Secured debt of about $180 million includes $139.5 million on a secured term loan and $39.3 million on a revolving credit. Attorneys at Dinsmore & Shohl LLP and Morris, Nichols, Arsht& Tunnell LLP serve as counsel to the Debtors. Kurtzman Carson Consultants is the claims and notice agent. Evercore's Lloyd Sprung and Paul Billyard serve as investment bankers to the Debtor. OSI RESTAURANT: Bank Debt Trades at 0.1% off in Secondary Market ---------------------------------------------------------------- Participations in a syndicated loan under which OSI Restaurant Partners, Inc. is a borrower traded in the secondary market at 99.90 cents-on-the- dollar during the week ended Friday, May 31, 2013, according to data compiled by LSTA/Thomson Reuters MTM Pricing and reported in The Wall Street Journal. This represents a drop of -0.83 percentage points from the previous week, the Journal relates. The loan matures Oct. 24, 2019. The Company pays 275 basis points above LIBOR to borrow under the facility. The bank debt carries Moody's B1 rating and S&P's BB rating. OSI Restaurant Partners LLC owns and operates a diversified base of casual dining concepts, which include Outback Steakhouse, Carrabba's Italian Grill, Bonefish Grill, Fleming's Prime Steakhouse and Wine Bar and Roy's. PARKVIEW, L.P.: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: Parkview, L.P. 545 West Germantown Pike Plymouth Meeting, PA 19462 Bankruptcy Case No.: 13-14704 Chapter 11 Petition Date: May 29, 2013 Court: U.S. Bankruptcy Court Eastern District of Pennsylvania (Philadelphia) Judge: Stephen Raslavich Debtor's Counsel: Albert A. Ciardi, III, Esq. CIARDI CIARDI & ASTIN, P.C. One Commerce Square 2005 Market Street, Suite 1930 Philadelphia, PA 19103 Tel: (215) 557-3550 Fax: (215) 557-3551 E-mail: aciardi@ciardilaw.com - and ? Daniel S. Siedman, Esq. CIARDI CIARDI & ASTIN, P.C. One Commerce Square 2005 Market Street, Suite 1930 Philadelphia, PA 19103 Tel: (215) 557-3550 E-mail: dsiedman@ciardilaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company did not file a list of creditors together with its petition. The petition was signed by Carmen Salamone, partner of Parkview, L.P. PICCADILLY RESTAURANTS: Seeks to Expand FTI Employment ------------------------------------------------------ Piccadilly Restaurants, LLC, et al., ask the U.S. Bankruptcy Court for permission to expand the scope of employment of FTI Consulting, Inc., to: a) continue those services past the initial 4 month period of FTI's initial engagement, through confirmation of a Plan of Reorganization (which the Debtors anticipate will be sometime in September 2013), and b) include these additional services: a. Work with the Debtors to develop a long term budget model focusing on, including variance tracking and analysis, preparation of sensitivity analysis. b. Business plan preparation. c. Assist the Debtors with various initiatives and analyses required by the restructuring process including: claims identification, reconciliation and analysis, analyses and support for negotiations related to its master lease agreements and other real estate support, executory contract review; and, other restructuring related requirements. d. Prepare an enterprise valuation of the business and provide testimony (both at deposition, contested matters or trial) thereon as necessary In addition to the fixed monthly fee of $75,000 that would continue as provided for the Original Engagement Contract through the expanded term of the engagement, the Debtors have agreed to pay FTI the amount of $330,000, which will be due and payable on the effective date of a Plan of Reorganization; provided, however, FTI will not be entitled to the Effective Date Payment in the event that: (a) the current DIP Lender is the sponsor and resulting majority equity holder under the Plan of Reorganization, or (b) there is a successful section 363 sale pursuant to which the DIP and prepetition secured debt is not fully satisfied. A hearing on the motion is set for June 18, 2013, at 10:00 a.m. at Courtroom, Lafayette. The counsel for the Debtors can be reached at: R. Patrick Vance, Esq. Elizabeth J. Futrell, Esq. Mark A. Mintz, Esq. Tyler J. Rench, Esq. JONES WALKER LLP 201 St. Charles Avenue, 51st Floor New Orleans, LA 70170 Tel: (504) 582-8000/ Direct: (504) 582-8194 Fax: (504) 589-8194 E-mail: pvance@joneswalker.com efutrell@joneswalker.com mmintz@joneswalker.com trench@joneswalker.com About Piccadilly Restaurants Piccadilly Restaurants, LLC, and two affiliated entities sought Chapter 11 bankruptcy protection (Bankr. W.D. La. Case Nos. 12-51127 to 12-51129) on Sept. 11, 2012. The affiliates are Piccadilly Food Service, LLC, and Piccadilly Investments LLC. Piccadilly Restaurants, LLC, headquartered in Baton Rouge, Louisiana, is the largest cafeteria-style restaurant in the United States, with operations in 10 states in the Southeast and Mid- Atlantic regions. It is wholly owned by Piccadilly Investments, LLC. Piccadilly operates an institutional foodservice division through a wholly owned subsidiary, Piccadilly Food Service, LLC, servicing schools and other organizations. With a history dating back to 1944, the Company operates 81 restaurants at three owned and 78 leased locations. Then known as Piccadilly Cafeterias, Inc., the Company filed for Chapter 11 relief (Bankr. S.D. Fl. Case No. 03-27976) on Oct. 29, 2003. Paul Steven Singerman, Esq., and Jordi Guso, Esq., at Berger Singerman, P.A. represented the Debtor in the case. After Piccadilly declared bankruptcy under Chapter 11, but before its plan was submitted to the Bankruptcy Court for the Southern District of Florida, the Bankruptcy Court authorized Piccadilly to sell its assets to Yucaipa Cos., for about $80 million. In October 2004, the Bankruptcy Court confirmed the plan. Judge Robert Summerhays oversees the 2012 cases. Lawyers at Jones, Walker, Waechter, Poitevent, Carrere & Denegre, LLP, in New Orleans, serve as the 2012 Debtors' counsel. BMC Group, Inc., serves as claims agent, noticing agent and balloting agent. In its schedules, the Debtor disclosed $34,952,780 in assets and $32,000,929 in liabilities. New York-based vulture fund Atalaya Administrative LLC, in its capacity as administrative agent for Atalaya Funding II, LP, Atalaya Special Opportunities Fund IV LP (Tranche B), and Atalaya Special Opportunities Fund (Cayman) IV LP (Tranche B), the Debtors' prepetition secured lender, is represented in the case by lawyers at Carver, Darden, Koretzky, Tessier, Finn, Blossman & Areaux, L.L.C.; and Patton Boggs, LLP. Henry G. Hobbs, Jr., Acting United States Trustee for Region 5, has appointed seven members to the official committee of unsecured creditors in the Debtors' Chapter 11 cases. In October, the Committee sought and obtained Court approval to employ Frederick L. Bunol, Albert J. Derbes, IV, of The Derbes Law Firm, L.L.C. as attorneys. PLY GEM: S&P Raises Corporate Credit Rating to 'B'; Outlook Stable ------------------------------------------------------------------ Standard & Poor's Ratings Services raised its corporate credit rating on Ply Gem industries Inc. to 'B' from 'B-'. The outlook is stable. At the same time, in conjunction with raising the corporate credit rating one notch, S&P raised its issue-level ratings on the company's 8.25% senior secured notes to 'B' from 'B-'. The recovery rating remains '4', indicating S&P's expectation of average (30% to 50%) recovery in the event of a payment default. S&P also raised the ratings on Ply Gem's 9.375% senior notes to 'CCC+' from 'CCC'. The recovery rating remains '6', indicating S&P's expectation of negligible (0% to 10%) recovery in the event of a payment default. "The upgrade reflects Ply Gem's successful completion of an IPO of its common stock, which raised $352 million of net proceeds, including the recent exercise of the over-allotment option?the greenshoe," said Standard & Poor's credit analyst Thomas Nadramia. The company also partially completed related deleveraging transactions, as it detailed in SEC filings, to redeem or repurchase at least $87.3 million of 8.25% senior secured notes due 2018 and $73 million of 9.375% senior notes due 2017, and to repay about $30 million of its asset-based lending revolving credit facility (ABL). A portion of the proceeds equal to C$82 million will also be used to acquire Mitten, a manufacturer of vinyl siding and accessories in Canada. If the acquisition of Mitten does not take place as planned, S&P expects the proceeds earmarked for this acquisition to be used to reduce additional debt. Finally, with the recent exercise of the greenshoe option, Ply Gem will have about $45 million of unused proceeds available, which S&P expects will retire additional debt. The outlook is stable. The company has modestly reduced balance- sheet leverage through a recent IPO and related term loan repayment and has reduced its interest expense by nearly $20 million. Furthermore, S&P expects further de-leveraging to occur as a result of improvement in Ply Gem's end markets, driven in 2013 and 2014 by improving housing starts, bringing credit measures more in line with the current rating. S&P views a positive rating action as unlikely over the next year, given still-high leverage and significant ownership (about 70%) of the company by private equity sponsors. However, a positive rating action could occur if Ply Gem's operating results exceed S&P's expectations over the next year, reducing leverage to 5x or less on a sustained basis, and if the public ownership increased, reducing private equity owners' (Caxton-Iseman) ownership stake to less than 40%, thereby reducing the probability of a re-leveraging event. S&P also views a negative rating action as unlikely given its expectations for improving residential construction markets in the U.S. However, S&P could lower the rating if there is an unexpected contraction in new home construction, or if a new recession (which S&P's economists forecast as having a 10%-15% probability) causes a severe curtailment of housing activity and consumer repair and remodeling spending--such that leverage deteriorates from current levels, and Ply Gem's liquidity becomes constrained. PRO'S RANCH: Files Voluntary Chapter 11 Bankruptcy Petition ----------------------------------------------------------- Pro's Ranch Markets on May 31 disclosed that the company has voluntarily filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code. "We made this important move to improve the overall health of the company and save the jobs of more than 2,200 team members," said Rick Provenzano, Pro's Ranch Markets' chief operating officer. "We are and have always been a family business. This opportunity to restructure our business will result in a stronger and more stable company for years to come." "We have been in business for over 30 years and we are confident that our family of stores will be in business for another 30 years," said Michael Provenzano, Jr., Pro's Ranch Markets' chief financial officer. "Our revenues were hurt by the lingering recession. This reorganization will put us back on a more firm financial footing. "We do not plan to sell or close any stores, and our shelves are fully stocked. We've had the honor and privilege of being in business since 1982, and we're committed to continuing to provide our customers with great products at low prices, and taking care of our vendors and our employees and their families." Pro's Ranch Markets has obtained a loan commitment for $3 million to continue operations smoothly during the reorganization, Mr. Provenzano said. "The company's short-term plan is to emerge from Chapter 11 as soon as possible, and over the next few months we will be laying out our long-term strategy to ensure success." Pro's Ranch Markets is a family-owned chain of grocery stores. Pro's Ranch Markets was founded 31 years ago by Mike Provenzano, Sr. Since then it has grown to eleven stores in three states, including seven stores in Arizona, two in New Mexico, and two in Texas. The company was named Arizona Retailer of the Year in 2004 and 2012 by the Arizona Food Marketing Alliance. Pro's Ranch Markets give back to their communities through goodwill events such as annual Back-to-School Backpack giveaways and free immunization health clinics. Pro's large stores include tortillerias and hot foods, as well as full-service bakeries and meat departments. Pro's has hired Phoenix-based HG Capital Partners as its restructure advisor, led by Managing Partner Jim Ameduri. For more information about Pro's Ranch Markets' reorganization, please visit http://www.prosranchreorg.comor contact Tom Stamas at (602) 254-7201, ext. 247. QUEBECOR MEDIA: Rogers Accord No Impact on Moody's Ba3 Rating ------------------------------------------------------------- Moody's Investors Service said Rogers Communications Inc.'s (Rogers; Baa1, stable) agreement with Videotron Ltee (a wholly- owned subsidiary of Quebecor Media Inc. [Ba3, stable]) to jointly build-out an expanded LTE wireless services network in the province of Quebec and the Ottawa region of Ontario, is credit- positive and ratings-neutral. Rogers Communications Inc., headquartered in Toronto, Ontario, is a broadband communications company that operates Canada's largest wireless services business (57% of revenues), one of Canada's two largest cable companies (30% of revenues), and various media businesses (radio, television, sports and publishing assets; 13% of revenues). REGAL ENTERTAINMENT: Fitch Rates $250MM Sr. Unsecured Notes 'B-' ---------------------------------------------------------------- Fitch rates Regal Entertainment Group's $250 million 10-year senior unsecured notes 'B-/RR6'. The new notes will rank pari pasu with Regal's existing 9.125% (due 2018) and 5.75% (due 2025) senior notes. Proceeds from the issuance are expected to fund the company's tender offer for a portion of its 9.125% senior notes and a portion of Regal Cinemas Corporation (Regal Cinemas) 8.625% senior notes due 2019. The notes will be issued under the Jan. 17, 2013 base indenture. Covenants include limitation on consolidated debt (net interest coverage greater than 2x incurrence test), limitation on restricted payments (a basket that increases based on, among other factors, the excess of EBITDA over 1.7x interest expense) and limitation on liens (standard carve-outs exist in addition to an incurrence test of 2.75x net senior secured leverage). In addition, the indenture includes a change of control provision that is triggered if any person (except for the Anschutz Company and any of its affiliates) becomes the beneficial owner of 50% or more of the voting stock of Regal. Other change of control triggers include a majority change in the Board of Directors, the liquidation or dissolution of Regal, and/or if all or substantially all of Regal's and its subsidiaries' assets are sold. There are cross payment default/cross acceleration provisions (among Regal and Regal Cinemas) in regard to defaulted/accelerated debt in excess of $25 million. Regal announced a tender offer to purchase up to $244 million in 9.125% senior notes due 2018 ($525 million outstanding) and Regal Cinemas 8.625% senior notes due 2019 ($400 million outstanding). Regal's 9.125% notes have a higher priority in the tender offer. Notes tendered on or prior to June 11 (the early tender date) will receive the following consideration: -- Every $1,000 in 9.125% Regal notes will receive $1,143.75; and -- Every $1,000 in 8.625% Regal Cinemas notes will receive $1,120. Fitch expects the transaction to be leverage neutral and to reduce interest expense. On Jan. 17, 2013, Regal issued $250 million at 5.75% and used most of the proceeds to fund the Hollywood Theatres acquisition. Liquidity and Leverage Regal's solid liquidity position is supported by annual pre- dividend free cash flow (FCF) between $150 million and $300 million, with $204 million of cash on hand as of March 28, 2013 (after adjusting for the $191 million cash portion of the Hollywood acquisition which was completed on March 29, 2013). Liquidity is also supported by $82.3 million availability under its $85 million revolver due 2015. FCF before dividend, as of March 28, 2013, latest 12 month (LTM) was $238 million. On April 30, the company announced regular quarterly cash dividend at $0.21 per share. Fitch estimates approximately $130 million in annual dividends, which is within Fitch's pre-dividend FCF expectations. With Regal instituting the regular dividend, Fitch expects FCF to be used primarily for acquisitions and mandatory term loan amortization (approximately $10 million). Regal has a favorable maturity profile with Regal Cinemas' term loans due in 2017 as its next material maturity. Fitch calculates unadjusted gross leverage of 4.4x, and interest coverage at 3.8x as of March 28, 2013. Recovery Regal's Recovery Ratings reflect Fitch's expectation that the enterprise value of the company and, thus, recovery rates for its creditors, will be maximized in a restructuring scenario (as a going concern) rather than a liquidation. Fitch estimates a distressed enterprise valuation of $1.8 billion, using a 5x multiple and including an estimate for Regal's roughly 20% stake in National CineMedia, LLC of approximately $190 million. Based on this enterprise valuation, which is before any administrative claims, overall recovery relative to total current debt outstanding is approximately 75%. The 'RR1' Recovery Rating for the company's credit facilities reflects Fitch's belief that 91%-100% expected recovery is reasonable. While Fitch does not assign Recovery Ratings for the company's operating lease obligations, it is assumed the company rejects only 30% of its remaining $3.2 billion in operating lease commitments due to their significance to the operations in a going-concern scenario and is liable for 15% of those rejected values (at a net present value). Fitch's recovery analysis shows full recovery for Regal Cinemas' senior unsecured notes, however, due to the unsecured nature of these notes, Fitch assigns an 'RR2' Recovery Rating. The 'RR6' assigned to Regal's senior unsecured notes reflects the structural subordination of the notes and Fitch's expectation for nominal recovery. Key Rating Drivers -- Regal Entertainment Group's (Regal) ratings reflect Fitch's belief that movie exhibition will continue to be a key promotion window for the movie studio's biggest/most profitable releases. -- Industry fundamentals have benefitted from a strong film slate in 2012 that included 'The Avengers,' 'The Amazing Spider-Man,' and 'The Dark Knight Rises.' The 2013 film slate is also solid and includes some highly anticipated movies such as 'The Hunger Games: Catching Fire,' 'Iron Man 3,' 'Star Trek Into Darkness,' 'The Hobbit: Desolation of Smaug,' and 'Thor: The Dark World.' However, Fitch believes that the 2013 film slate, while solid, will not be able to match 2012's performance. Fitch expects industry box office revenues to be down in the low to mid- single digits. Fitch believes that this is part of the hit- cyclical nature of the industry and Fitch maintains a stable outlook on the industry. -- For the long term, Fitch continues to expect that the movie exhibitor industry will be challenged in growing attendance and any potential attendance declines will offset some of the growth in average ticket prices. The ratings factor in the intermediate/long-term risks associated with increased competition from at-home entertainment media, limited control over revenue trends, pressure on film distribution windows, and increasing indirect competition from other distribution channels (such as VOD and other OTT services). Regal and its peers rely on the quality, quantity, and timing of movie product, all factors out of management's control. Rating Sensitivities Limited Rating Upside: Fitch heavily weighs the prospective challenges facing Regal and its industry peers in arriving at the long-term credit ratings. Significant improvements in the operating environment (sustainable increases in attendance) and sustained deleveraging could have a positive effect on the rating, though Fitch views this as unlikely. Negative Trigger: Fitch anticipates Regal and other movie exhibitors will continue to consolidate. A debt-financed material acquisition or return of capital to shareholders that would raise the unadjusted gross leverage beyond 4.5x could have a negative effect on the rating, though this is not anticipated. In addition, meaningful, sustained declines in attendance and/or per-guest concession spending, which drove leverage beyond 4.5x, may pressure the rating as well. Fitch currently rates Regal and Regal Cinemas as follows: Regal -- Issuer Default Rating (IDR) 'B+'; -- Senior unsecured notes 'B-/RR6'. Regal Cinemas -- IDR 'B+'; -- Senior secured credit facility 'BB+/RR1'; -- Senior unsecured notes 'BB/RR2'. The Rating Outlook is Stable. REVEL AC: S&P Withdraws All Ratings Following Bankruptcy Emergence ------------------------------------------------------------------ Standard & Poor's Ratings Services withdrew all ratings on Atlantic City-based Revel AC Inc., including the corporate credit rating, following the company's announcement that it has completed its financial restructuring and emerged from bankruptcy on May 21, 2013. REVOLUTION DAIRY: Panel Retains Berkeley as Financial Advisor ------------------------------------------------------------- The Official Committee of Unsecured Creditors of Revolution Dairy LLC asks the U.S. Bankruptcy Court for permission to employ Berkeley Research Group, LLC as financial advisor. The firm will, among other things, provide these services: a. performing an analysis and evaluation of any disclosure statement and plan proposed Cases; b. reviewing and analyzing monthly operating reports prepared by the Debtors; and c. performing an independent analysis of the financial situation of the Debtors. Marvin A. Tenenbaumin attests that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. The panel's counsel can be reached at: David E. Leta, Esq. Troy J. Aramburu, Esq. Brock N. Worthen, Esq. Blakely J. Denny, Esq. SNELL & WILMER L.L.P. 15 West South Temple Suite 1200 Salt Lake City, UT 84101 Tel: (801)257-1900 Fax: (801)257-1800 E-mail: dleta@swlaw.com taramburu@swlaw.com bworthen@swlaw.com bdenny@swlaw.com About Revolution Dairy Revolution Dairy LLC is one of the largest dairy farms in Utah. Revolution Dairy and affiliate Highline Dairy, LLC, filed bare- bones Chapter 11 petitions (Bankr. D. Utah Case Nos. 13-20770 and 13-20771) in Salt Lake City on Jan. 27, 2013. Each of the Debtors estimated $10 million to $50 million in assets and liabilities. Managers of Revolution and Highline -- Robert and Judith Bliss -- also sought Chapter 11 protection (Case No. 13-20772). Revolution Dairy, LLC, is represented by Prince, Yeates & Geldzahler. Highline Dairy is represented by Parsons Kinghorn & Harris. Robert and Judith Bliss are represented by Berry & Tripp. The Debtors have sought joint administration of their cases. The U.S. Trustee appointed five members to the official committee of unsecured creditors. The Committee retained Snell and Wilmer L.L.P. as its counsel. REVOLUTION DAIRY: Seeks to Extend Plan Filing Deadline to June 24 ----------------------------------------------------------------- Revolution Dairy LLC asks the U.S. Bankruptcy Court for an extension until June 24, 2013, of the deadline to file its Chapter 11 plan and disclosure statement and the deadline to obtain acceptances on the Plan to Aug. 23, 2013. Hearing on the motion is set for June 6 and the deadline for filing objections is set for June 5. About Revolution Dairy Revolution Dairy LLC is one of the largest dairy farms in Utah. Revolution Dairy and affiliate Highline Dairy, LLC, filed bare- bones Chapter 11 petitions (Bankr. D. Utah Case Nos. 13-20770 and 13-20771) in Salt Lake City on Jan. 27, 2013. Each of the Debtors estimated $10 million to $50 million in assets and liabilities. Managers of Revolution and Highline -- Robert and Judith Bliss -- also sought Chapter 11 protection (Case No. 13-20772). Revolution Dairy, LLC, is represented by Prince, Yeates & Geldzahler. Highline Dairy is represented by Parsons Kinghorn & Harris. Robert and Judith Bliss are represented by Berry & Tripp. The Debtors have sought joint administration of their cases. The U.S. Trustee appointed five members to the official committee of unsecured creditors. The Committee tapped to retain Snell and Wilmer L.L.P. as its counsel. RG STEEL: Hilco Warren Buys Steel Making Assets From BDM Warren --------------------------------------------------------------- Hilco Trading, LLC on May 31 disclosed that Hilco Warren, LLC purchased the steel making assets at the former RG Steel Mill facility in Warren, Ohio from BDM Warren Steel Holdings, LLC. BDM is an entity formed to acquire all assets of the former RG mill in Warren. Gary Epstein, Chief Marketing Officer for Hilco, indicated that it is planning an aggressive push to seek buyers for the facility as a whole or in part. "Hilco will run a sale process that will include continuing to market the steel making complex, vetting and evaluating all offers in a private treaty sale," he said. The Warren Steel Mill which is over 110 years old was sold most recently in September 2012 to BDM in US Bankruptcy Court in Delaware after all steel making work was halted in May of 2012 by its previous owner RG Steel. "Our goal is to do everything possible to find a purchaser for the facility that can operate the hot mill facility as a going concern," said Mr. Epstein. He further indicated that there may be some precision demolition work completed at the cold mill site, however, Hilco remains focused on finding a buyer, making every reasonable effort to get the hot steel making operation up and running again. Court documents filed following the bankruptcy last year indicate that BDM was committed to finding a steel making operator to run the facility and included a specific moratorium on the removal or sale of assets at the 1200 acre site for nine months after BDM's acquisition. Hilco intends to fulfill this obligation and will aggressively seek a going concern buyer for the hot mill. BDM committed substantial capital to maintain the facility throughout the winter of 2012/13 while continuing to market the complex, making every effort toward getting it operational on some scale. About Hilco Trading, LLC Headquartered in Northbrook, Illinois (USA), Hilco -- http://www.hilcotrading.com-- is a privately-held, diversified financial services firm whose principal competency is understanding and maximizing the value of business assets, including retail, consumer and industrial inventory; machinery and equipment; real estate; accounts receivable; intellectual property; and, going-concern enterprises. Through 500 professionals operating on five continents, Hilco helps companies and their professional advisors assess asset value, maximize value for said assets through asset monetization solutions, and enhance value through advisory and consulting solutions. About BDM Warren Steel Holding LLC BDM is a newly formed company, as part of the purchase of the Warren Steel Mill complex in 2012, with three (3) very experienced groups as its principals. The first participant is Charles J. Betters who operates several companies including Beaver Valley Slag and Bet-Tech Construction. Mr. Betters has significant experience in the environmental remediation and subsequent redevelopment of brownfields. The second participant is Stephen M. Muck of Grouse Ridge Capital, LLC, a diversified investment firm. Mr. Muck has experience in heavy civil construction and demolition along with real estate and brownfield development as well as investment banking experience. The final participant is the DiGeronimo Family, owners of Independence Excavating. Independence Excavating is a general contractor specializing in highway and large earth moving projects. History of the Warren, Ohio Steel Mill In 2012, RG Steel's closing of the facility in Warren, Ohio brought an end to 110 years of steelmaking at the site, which began in 1902 as Republic Steel Corp. The company was then purchased by Jones & Laughlin Steel Corp., which subsequently became LTV Steel. After LTV declared bankruptcy during the late 1980s, the company was reorganized as WCI Steel and purchased by the Renco Group. However, WCI filed for bankruptcy in 2002, and the mill was sold in 2008 to Severstal SA, one of the largest steel and mining companies in Russia. In 2010, Severstal sold the mill to RG Steel. RG Steel filed for Bankruptcy in May of 2012, and BDM purchased the facility in August of that same year. About RG Steel RG Steel LLC -- http://www.rg-steel.com/-- is the United States' fourth-largest flat-rolled steel producer with annual steelmaking capacity of 7.5 million tons. It was formed in March 2011 following the purchase of three steel facilities located in Sparrows Point, Maryland; Wheeling, West Virginia and Warren, Ohio, from entities related to Severstal US Holdings LLC. RG Steel also owns finishing facilities in Yorkville and Martins Ferry, Ohio. It also owned Wheeling Corrugating Company and has a 50% ownership in Mountain State Carbon and Ohio Coatings Company. RG Steel along with affiliates, including WP Steel Venture LLC, sought bankruptcy protection (Bankr. D. Del. Lead Case No. 12- 11661) on May 31, 2012. Bankruptcy was precipitated by liquidity shortfall and a dispute with Mountain State Carbon, LLC, and a Severstal affiliate, that restricted the shipment of coke used in the steel production process. The Debtors estimated assets and debts in excess of $1 billion. As of the bankruptcy filing, the Debtors owe (i) $440 million, including $16.9 million in outstanding letters of credit, to senior lenders led by Wells Fargo Capital Finance, LLC, as administrative agent, (ii) $218.7 million to junior lenders, led by Cerberus Business Finance, LLC, as agent, (iii) $130.5 million on account of a subordinated promissory note issued by majority owner The Renco Group, Inc., and (iv) $100 million on a secured promissory note issued by Severstal. Judge Kevin J. Carey presides over the case. The Debtors are represented in the case by Robert J. Dehney, Esq., and Erin R. Fay, Esq., at Morris, Nichols, Arsht & Tunnell LLP, and Matthew A. Feldman, Esq., Shaunna D. Jones, Esq., Weston T. Eguchi, Esq., at Willkie Farr & Gallagher LLP, represent the Debtors. Conway MacKenzie, Inc., serves as the Debtors' financial advisor and The Seaport Group serves as lead investment banker. Donald MacKenzie of Conway MacKenzie, Inc., as CRO. Kurtzman Carson Consultants LLC is the claims and notice agent. Wells Fargo Capital Finance LLC, as Administrative Agent, is represented by Jonathan N. Helfat, Esq., and Daniel F. Fiorillo, Esq., at Otterbourg, Steindler, Houston & Rosen, P.C.; and Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachuiski Stang Ziehi & Jones LLP. Renco Group is represented by lawyers at Cadwalader, Wickersham & Taft LLP. Kramer Levin Naftalis & Frankel LLP represents the Official Committee of Unsecured Creditors. Huron Consulting Services LLC serves as the Committee's financial advisor. The Debtor has sold off the principal plants. The sale of the Wheeling Corrugating division to Nucor Corp. brought in $7 million. That plant in Sparrows Point, Maryland, fetched the highest price, $72.5 million. CJ Betters Enterprises Inc. paid $16 million for the Ohio plant. RHODES COMPANIES: Dist. Court Won't Reinstate James Rhodes' Claims ------------------------------------------------------------------ Nevada District Judge Miranda M. Du affirmed a Nevada bankruptcy court order sustaining reorganized The Rhodes Companies LLC's objection to James Rhodes' Entitlement to the Tax Claim Found in Proof of Claim No. 814-33. On July 17, 2009, Mr. Rhodes filed a Proof of Claim seeking $10,598,000 for (1) reimbursement for taxes paid by Mr. Rhodes on account of taxable income allocated to him from some of the Debtors in the amount of $9,729,151 -- Tax Claim -- and (2) $868,849 advanced to Greenway Partners, LLC -- Greenway Claim. The Tax Claim seeks reimbursement for the taxes Mr. Rhodes paid on behalf of debtors Heritage Land Company, LLC, The Rhodes Companies, LLC, and Rhodes Ranch General Partnership. The taxable income from the Debtor Entities was passed through to Mr. Rhodes through the following Non-Debtors: Sedora Holdings, LLC, Rhodes Ranch, LLC, and Sagebrush Enterprises, Inc. Mr. Rhodes owned and controlled the Non-Debtor Entities, and the Non-Debtor Entities owned and controlled the Debtor Entities; all of them were pass-through entities for federal tax purposes, with their taxable income all allocated to Mr. Rhodes. The total amount of taxable income that flowed to Mr. Rhodes was $21,014,159. Of this amount, $6,974,159 of taxes and $2,754,992 in penalties and interest were paid by Mr. Rhodes, the sum of which makes up the $9,729,151 that comprises the Tax Claim. The books and records of The Rhodes Companies, LLC contain a ledger entry dated March 31, 2009, in the amount of $9,729,151 due to Mr. Rhodes. This ledger entry forms the basis for the Tax Claim. According to Mr. Rhodes, the Debtor Entities made distributions to the Non-Debtor Entities since 2005 and prior to the date of the bankruptcy petition to cover their tax liabilities. He represents by his declaration testimony that he declared a dividend from the Debtor Entities to himself as reimbursement for the tax payments. Mr. Rhodes argued during bankruptcy, and now on appeal, that a course of conduct existed prior to the petition's filing that requires the Debtor Entities to reimburse him as a creditor. The Bankruptcy Court issued the Order Sustaining Objection on November 16, 2010, disallowing and expunging the Tax Claim. Bankruptcy Judge Linda B. Riegle ruled that Mr. Rhodes was under an obligation to pay the tax liabilities of the Debtor Entities, and the operating documents of the Debtor Entities do not mandate that they reimburse Mr. Rhodes for these obligations. As a result, Mr. Rhodes' Tax Claim is valid only if he demonstrates that a decision was made by the Debtor Entities to reimburse Mr. Rhodes for the tax payments. Judge Riegle held that such a showing was not made, and, in the alternative, held that Mr. Rhodes' argument about a course of conduct does not apply here due to changed circumstances brought upon by "hard times." After denying a motion to reconsider the November 16, 2010, Order the Bankruptcy Court approved the parties' stipulation that provided Mr. Rhodes the right to appeal the dismissal of his Tax Claim. On January 25, 2012, Mr. Rhodes filed his notice of appeal of the Order Sustaining Objection. The question on appeal is whether the Bankruptcy Court correctly sustained Reorganized Debtors' objection to Mr. Rhodes' Tax Claim. The District Court held, however, that after reviewing the record and the parties' briefs, Mr. Rhodes has failed to demonstrate that the Bankruptcy Court's findings of fact were clearly erroneous or that its legal conclusions were in error. The case is JAMES M. RHODES, Appellant, v. THE RHODES COMPANIES, LLC aka "Rhodes Homes," et al., Reorganized Debtors, Appellee. Case No. 2:12-cv-00139-MMD-VCF (D. Nev.). A copy of the District Court's May 29, 2013 Order is available at http://is.gd/8dCAQW from Leagle.com. About Rhodes Companies The Rhodes Companies LLC is a private master planned community developer and homebuilder in the Las Vegas valley. The company was founded in 1991. The company and its affiliates sought Chapter 11 protection (Bankr. D. Nev. Lead Case No. 09-14778) on March 31, 2009. When the Debtors filed for protection from their creditors, they estimated their assets and debts between $100 million and $500 million. The Debtors were represented by Pachulski, Stang, Ziehl and Jones; and Zachariah Larson, Esq., at Larson & Stephens. A steering committee of the former first lien lenders was represented by Akin Gump Strauss Hauer and Feld, along with Kolesar and Leatham. Carwin Advisors, a national real estate advisory firm based in Dallas, served as financial advisor to the first lien steering committee. ROTHSTEIN ROSENFELDT: Plan Going to Creditors for Vote ------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the trustees for the law firm run by admitted Ponzi schemer Scott Rothstein amended the firm's liquidating Chapter 11 plan and in the process won approval from the bankruptcy judge at a hearing May 29 for sending the plan to creditors for a vote. The report recounts that last month, trustee Herbert Stettin suffered a defeat when the bankruptcy judge in Fort Lauderdale, Florida, refused to approve a disclosure statement for a prior version of the plan. In the meantime, Mr. Stettin modified the plan, this time winning support from the official creditors' committee. The report notes that Mr. Stettin, as trustee for the firm Rothstein Rosenfeldt Adler PA, revised the plan to forestall a movement by dissident creditors for conversion of the Chapter 11 case to liquidation in Chapter 7. The revised plan, filed May 8, addresses issues some creditors found unacceptable in the prior version. The $72.4 million settlement payment from TD Bank NA comes in sooner and so-called third-party releases were cut back. The report says that the committee now selects the liquidating trustee, and it's expected that unsecured creditors will be paid in full. The new plan provides for a first distribution immediately after the plan becomes effective. Rothstein co founded Rothstein Rosenfeldt. Creditors filed an involuntary Chapter 11 petition against the firm in Fort Lauderdale in November 2009. About Rothstein Rosenfeldt Scott Rothstein, co-founder of law firm Rothstein Rosenfeldt Adler PA -- http://www.rra-law.com/-- was suspected of running a $1.2 billion Ponzi scheme. U.S. authorities claimed in a civil forfeiture lawsuit filed Nov. 9, 2009, that Mr. Rothstein, the firm's former chief executive officer, sold investments in non- existent legal settlements. Mr. Rothstein pleaded guilty to five counts of conspiracy and wire fraud on Jan. 27, 2010. Creditors of Rothstein Rosenfeldt Adler signed a petition sending the Florida law firm to bankruptcy (Bankr. S.D. Fla. Case No. 09-34791). The petitioners include Bonnie Barnett, who says she lost $500,000 in legal settlement investments; Aran Development, Inc., which said it lost $345,000 in investments; and trade creditor Universal Legal, identified as a recruitment firm, which said it is owed $7,800. The creditors alleged being owed money invested in lawsuit settlements. Herbert M. Stettin, the state-court appointed receiver for Rothstein Rosenfeldt, was officially carried over as the Chapter 11 trustee in the involuntary bankruptcy case. On June 10, 2010, Mr. Rothstein was sentenced to 50 years in prison. The official committee of unsecured creditors appointed in the case is represented by Michael Goldberg, Esq., at Akerman Senterfitt. ROYAL CARIBBEAN: May 27 Fire Incident No Impact on Moody's Ratings ------------------------------------------------------------------ Moody's Investors Service commented that Royal Caribbean Cruises Ltd.'s (RCL) Ba1 Corporate Family Rating remains unchanged after the fire aboard the Grandeur of the Seas on May 27, 2013 that resulted in cruise cancellations and damage to the ship. The Grandeur of the Seas represents about 2% of RCL's total fleet capacity of approximately 98,650 berths. Royal Caribbean Cruises Ltd. is a global vacation company that operates six brands (including one, TUI Cruises, through a joint venture) -- the largest being Royal Caribbean International (RCI) and Celebrity Cruises -- which collectively operate 41 cruise ships with 5 ships on order. The company generates annual net revenue of about $5.9 billion. RURAL/METRO CORP: High Leverage Cues Moody's to Cut CFR to Caa2 --------------------------------------------------------------- Moody's Investors Service downgraded Rural/Metro Corporation's corporate family and probability of default ratings to Caa2 from B3. In addition, Moody's lowered the senior secured credit facilities to B3 from B1 and the senior unsecured notes to Caa3 from Caa2. The ratings outlook remains negative. The downgrade of the corporate family rating to Caa2 with a negative outlook reflects Rural/Metro's highly leveraged capital structure and weak liquidity position, reduced earnings and negative free cash flow, as well as acquisitions that have resulted in a majority of its revolving credit facility being utilized. With reduced expectations for revenue and EBITDA following the company's $35 million A/R reserve increase, Moody's anticipates that adjusted debt to EBITDA will remain over 9 times and interest coverage (EBITDA less capex to interest) will remain weak over the next 12 months. The following rating actions were taken: Corporate family rating, downgraded to Caa2 from B3; Probability of default rating, downgraded to Caa2-PD from B3-PD; $110 million revolving credit facility, due 2016, downgraded to B3 (LGD2, 25%) from B1 (LGD2, 24%); $325 million term loan, due 2018, downgraded to B3 (LGD2, 25%) from B1 (LGD2, 24%); $200 million unsecured notes, due 2019, downgraded to Caa3 (LGD5, 80%) from Caa2 (LGD5, 80%); $108 million unsecured notes, due 2019, downgraded to Caa3 (LGD5, 80%) from Caa2 (LGD5, 80%). Ratings Rationale: The Caa2 corporate family rating reflects Moody's expectation that the company's credit metrics and liquidity profile will remain pressured due to lower revenue and A/R conversion rates. Revenue conversion has declined to $0.33 per $1 for the nine month period ended 3/31/2013 as compared to $0.40 per $1 the prior year. This decline is a result of increased contractual allowances and uncompensated care due to cash collection and revenue recognition challenges, a shift in payor mix, and the growing pressures of self-pay accounts. The company made a change in the A/R reserve during the quarter, leading to a $35 million decline in net revenue, the second of such reserve changes in the last four quarters ended 3/31/2013. Additionally, weak liquidity and revenue concentration continue to weigh on the rating. The rating favorably reflects continued growth in Rural/Metro's total medical transports through new contract wins as well as prior acquisitions. The negative outlook reflects Rural/Metro's weak liquidity position as well as uncertainty around the company's ability to organically grow EBITDA and reduce debt levels in the midst of a difficult operating environment. Moody's will continue to monitor the company's cash collection and revenue conversion rates. The rating could be downgraded if free cash flow generation remains negative and revolver availability declines, further pressuring the company's liquidity profile. Additional acquisitions in lieu of debt repayment, failure to renew contracts and/or a more challenging reimbursement rate environment could further pressure the ratings. Failure to meet debt service requirements would also have negative rating implications. The rating could be upgraded if Rural/Metro improves its liquidity profile and operational capabilities, including the improvement of the company's cash collection and revenue recognition processes. Organic revenue, transport, and EBITDA growth such that adjusted debt to EBITDA is reduced to below 6 times would also lead to consideration for a rating upgrade. The principal methodology used in this rating was the Global Healthcare Service Providers Industry Methodology published in December 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Rural/Metro provides emergency and non-emergency medical transportation, fire protection, airport fire rescue, and home healthcare services in 21 states and approximately 700 communities within the United States. The services are provided under contract with government entities, hospitals, healthcare facilities and other healthcare organizations. Net revenue for the twelve months ended March 31, 2013 was approximately $664 million. Rural/Metro was bought by Warburg Pincus in 2011. SAN DIEGO HOSPICE: Amends Schedules of Assets and Liabilities ------------------------------------------------------------- San Diego Hospice & Palliative Care Corporation amended its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $16,550,000 B. Personal Property $9,669,007 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $0 E. Creditors Holding Unsecured Priority Claims $1,894,961 F. Creditors Holding Unsecured Non-priority Claims $11,316,258 ----------- ----------- TOTAL $26,219,007 $13,211,219 A copy of the amended schedules is available for free at http://bankrupt.com/misc/SAN_DIEGO_sal_amended.pdf As reported in the Troubled Company Reporter on March 20, 2013, the Debtor disclosed $20,369,007 in assets and $14,888,058 in liabilities. About San Diego Hospice San Diego Hospice & Palliative Care Corporation filed a Chapter 11 petition (Bankr. S.D. Cal. Case No. 13-01179) in San Diego on Feb. 4, 2013. The Debtor is the operator of the San Diego Hospice and The Institute for Palliative Medicine, one of the largest community-owned, not-for-profit hospices in the country. The Debtor scheduled $20,369,007 in total assets and $14,888,058 in total liabilities. Even before the bankruptcy filing, the Debtor has been under a federal investigation, focusing whether it allowed patients to stay in the program even when their diagnosis changed. The Debtor said that it will meet with government agencies to address their concerns, explore partnerships with other health care organizations, and work to restructure and resize San Diego Hospice. The Debtor said it has encouraged Scripps Health, the region's largest provider of health care services, to enter the hospice business. Procopio, Cory, Hargreaves & Savitch LLP serves as counsel to the Debtor. On April 30, 2013, San Diego Hospice received Court authority to sell its unused 24-bed hospice facility to Scripps Health for $16.55 million. Scripps made the opening bid of $10.7 million at the auction that took place before the sale-approval hearing. The other bidder was Sharp Healthcare. The sale is also subject to approval by regulators in California. In May 2013, San Diego Hospice and its creditors' committee jointly filed a liquidating Chapter 11 plan and an explanatory disclosure statement. There will be a June 27 hearing in U.S. Bankruptcy Court in San Diego for approval of disclosure materials telling unsecured creditors with claims from $12 million to $16 million why their recovery may range from nothing to 43 percent. SANDISK CORP: S&P Revises Outlook to Positive & Affirms 'BB' CCR ---------------------------------------------------------------- Standard & Poor's Ratings Services revised its rating outlook on SanDisk Corp. to positive from stable. At the same time, S&P affirmed its 'BB' corporate credit rating on the company and 'BB' issue rating on its senior unsecured debt. The recovery rating on the senior unsecured debt is unchanged at '3', indicating expectations of meaningful (50% to 70%) recovery in a payment default. "The outlook revision is based on the company's improving financial risk profile, with leverage of less than 2.0x, strong liquidity, and good revenue growth prospects in its addressable markets," said Standard & Poor's credit analyst John Moore. The rating on SanDisk reflects its narrow scope of business in highly volatile semiconductor flash memory markets and the substantial investment required to maintain technology and cost leadership, what S&P characterizes as a "weak" business risk profile, as well as an "intermediate" financial risk profile. SanDisk is a leading producer of NAND flash memory based storage solutions whose products are broadly used in consumer electronics products, including mobile phones, digital cameras, and game systems. The company procures most of its flash memory through fabrication facilities owned in joint-venture (JV) partnerships with Toshiba. The positive outlook reflects S&P's expectations for improving operating results from current levels over the coming year, lower leverage, and good liquidity as an offset to considerable business risk. S&P could raise the rating over the coming 12 months if industry supply conditions remain intact and the company continues to achieve revenue growth in its addressable flash memory markets without departing from its moderate financial policies. S&P could revise the outlook to stable if a sharp cyclical downswing causes revenue or earnings declines over the coming year. SCHOOL SPECIALTY: Seeks More Exclusivity Just in Case ----------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that even though School Specialty Inc. was the beneficiary of an order signed by the bankruptcy court on May 23 approving the Chapter 11 plan, the supplier of educational products for kindergarten through 12th grade is seeking an expansion of exclusive plan-filing rights "through an abundance of caution." The report shares that because the court may confirm no more than one plan, some practitioners take the position that exclusive plan-filing rights, known as exclusivity, need not be extended after confirmation. In the case of School Specialty, the company said exclusivity will expire on May 28. The company scheduled a hearing on June 17 to extend exclusivity until July 29. The report notes that the loss of exclusivity could become a problem for a company unable to implement a confirmed plan. If confirmation were revoked, a creditor could theoretically file a plan, unless exclusivity had been extended. The plan gives 87.5 percent of the reorganized company's stock to lenders who provided $155 million in replacement financing, for a predicted full recovery. Note holders owed $170.7 million are receiving the other 12.5 percent of the stock, for an estimated 6 percent recovery. About School Specialty Based in Greenville, Wisconsin, School Specialty is a supplier of educational products for kindergarten through 12th grade. Revenue in 2012 was $731.9 million through sales to 70% of the country's 130,000 schools. School Specialty and certain of its subsidiaries filed voluntary petitions for reorganization under Chapter 11 (Bankr. D. Del. Lead Case No. 13-10125) on Jan. 28, 2013. The petition estimated assets of $494.5 million and debt of $394.6 million. The Debtors are represented by lawyers at Paul, Weiss, Rifkind, Wharton & Garrison LLP and Young, Conaway, Stargatt & Taylor, LLP. Alvarez & Marsal North America LLC is the restructuring advisor and Perella Weinberg Partners LP is the investment banker. Kurtzman Carson Consultants LLC is the claims and notice agent. The ABL Lenders are represented by lawyers at Goldberg Kohn and Richards, Layton and Finger, P.A. The Ad Hoc DIP Lenders led by U.S. Bank are represented by lawyers at Stroock & Stroock & Lavan LLP, and Duane Morris LLP. The lending consortium consists of some of the holders of School Specialty Inc.'s 3.75% Convertible Subordinated Notes Due 2026. The Official Committee of Unsecured Creditors appointed in the case is represented by lawyers at Brown Rudnick LLP and Venable LLP. Bayside is represented by Pepper Hamilton LLP and Akin Gump Strauss Hauer & Feld LLP. School Specialty in April 2013 decided to reorganize rather than sell. The company filed a so-called dual track plan that called for selling the business at auction on May 8 or reorganizing while giving stock to lenders and unsecured creditors. The company later served a notice that the auction was canceled and the plan would proceed by swapping debt for stock to be owned by lenders, noteholders, and unsecured creditors. SELECT MEDICAL: Moody's Lifts Rating on Sr. Debt Facility to Ba2 ---------------------------------------------------------------- Moody's Investors Service upgraded the ratings on Select Medical Corporation's senior secured credit facilities to Ba2 (LGD 2, 27%) from B1 (LGD 3, 45%). Select Medical Corporation is a wholly owned subsidiary of Select Medical Holdings Corporation (collectively Select). Moody's also affirmed Select's remaining ratings, including the B1 Corporate Family Rating and B1-PD Probability of Default Rating. This concludes the review for upgrade of the ratings on Select's bank debt that was initiated with the proposed offering of senior unsecured notes on May 13, 2013. The two notch upgrade reflects the reduction in the amount of senior secured debt outstanding and the introduction of a layer of loss absorption ahead of the secured debt as proceeds from the $600 million senior unsecured note offering were used to repay a portion of the outstanding term loans. Ratings upgraded: Senior secured revolving credit facility expiring 2016 to Ba2 (LGD 2, 27%) from B1 (LGD 3, 45%) Senior secured term loan due 2016 to Ba2 (LGD 2, 27%) from B1 (LGD 3, 45%) Senior secured term loan due 2018 to Ba2 (LGD 2, 27%) from B1 (LGD 3, 45%) Ratings affirmed/LGD assessments revised: 6.375% senior unsecured notes due 2021 to B3 (LGD 5, 82%) from B3 (LGD 5, 84%) Corporate Family Rating at B1 Probability of Default Rating at B1-PD Speculative Grade Liquidity Rating at SGL-2 Ratings Rationale: Select's B1 Corporate Family Rating reflects the company's moderately-high leverage, as well as its reliance on the specialty hospital segment for the majority of its EBITDA, which presents risk given the concentration of revenue from Medicare. The rating also reflects Moody's consideration of Select's considerable scale and position as one of the largest long-term acute care and outpatient rehabilitation providers in the US. The rating also reflect Moody's expectation that the company will continue to generate strong free cash flow that can be used to repay debt and invest in growth opportunities. The rating could be upgraded if Moody's expects the company to maintain leverage below 4.0 times either through debt repayment or EBITDA growth. Moody's would also have to be comfortable that Select's operations could absorb negative regulatory developments at the higher rating level or see evidence that the regulatory environment was becoming more benign. Moody's could downgrade the rating if adverse developments in Medicare regulations or reimbursement result in significant deterioration in margins or cash flow coverage metrics, or if the company completes a material debt financed acquisition or shareholder initiative. More specifically, Moody's could downgrade the rating if leverage is expected to rise and be sustained above 5.0 times. The principal methodology used in this rating was the Global Healthcare Service Providers 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. Select Medical Corporation, headquartered in Mechanicsburg, PA, provides long-term acute care hospital services and inpatient acute rehabilitative care through its specialty hospital segment. The company also provides physical, occupational, and speech rehabilitation services through its outpatient rehabilitation segment. Select Medical Corporation is a wholly owned subsidiary of Select Medical Holdings Corporation. For the twelve months ended March 31, 2013, Select recognized net revenue in excess of $2.9 billion. SERVICE CORP: S&P Puts 'BB-' Sr. Unsec. Rating on CreditWatch Neg. ------------------------------------------------------------------ Standard & Poor's Ratings Services said it affirmed its 'BB' corporate credit rating on Houston-based cemetery and funeral home operator Service Corp. International (SCI). At the same time, S&P placed its 'BB-' issue-level rating on Service Corp.'s senior unsecured debt on CreditWatch with negative implications because the size of this debt class may increase substantially relative to S&P's estimate of the enterprise's value in the event of default. S&P's current recovery rating on the senior unsecured debt is '5', indicating its expectation for modest (10% to 30%) recovery of principal in the event of payment default. S&P based the affirmation on a modest incremental increase in pro forma leverage, which it calculates at about 4.2x, and good cash flows generated by each entity, which will allow for some rapid deleveraging. SCI was accumulating capacity for a leveraged transaction, with debt to EBITDA at 2.8x as of March, 31, 2013. S&P views the acquisition as neutral to its view of SCI's "fair" business risk profile. While the addition of Stewart adds some geographic diversity, the combined entity remains a small player in the fragmented U.S. funeral and cemetery industry. S&P expects a modest amount of synergies as greater corporate economies of scale offers benefits to these typically locally operated businesses. Separately, S&P placed its senior unsecured ratings for Stewart Enterprises Inc. on CreditWatch with developing implications. S&P could raise its ratings on these notes to equal its corporate credit rating on SCI or lower them by as many as two notches below, depending on final structural considerations that affect priority in the new combined capital structure S&P expects to resolve the CreditWatch listings of the senior unsecured debt ratings when the structure of SCI's financing plans are finalized. "We will continue to view the new SCI's business risk as "fair", reflecting the company's leading position in a fragmented competitive field, the very mature industry in which it operates and narrow focus," said credit analyst Tahira Wright. "SCI is by far the nation's largest cemetery and funeral home operator. However, even with the Stewart business, it currently captures only about 17% of the funeral and cemetery market and faces a few smaller national and many smaller regional competitors." "Our stable rating outlook reflects our expectation that stable operating trends will support good free cash flow generation and gradual delevering from initial debt leverage in the low-4x area. Given the nature of the business, we do not expect a sharp decline in profitability. However, a downgrade is possible if SCI pursues an additional debt-financed acquisition that causes adjusted leverage to increase above 5x. Given the modest uptick in leverage that we expect over the next two years, we consider an upgrade unlikely, but would consider it if debt leverage decreases to below 3x and we believe the company will administer growth and shareholder return policies in a manner that preserves a more conservative financial profile," S&P noted. SLM CORP: Moody's Clarifies Recent Ratings Action ------------------------------------------------- Moody's Investors Service issued a clarification regarding SLM Corporation's preferred stock following its recently announced reorganization. On May 29, 2013, Moody's placed the Corporate Family Rating (CFR) and long-term ratings of SLM (CFR and senior unsecured Ba1) on review for possible downgrade. That action followed SLM's announcement of the same date that it intended to reorganize its business into two separate companies, a new entity not yet named (Newco), which will contain SLM's legacy FFELP and private education loan portfolios, FFELP and Department of Education loan servicing operations, collections business, and all of SLM's existing unsecured and secured debt; and SLM Bank, which will contain the company's current banking operations, private education loans and related origination and servicing platforms, cash and other investments, and the Sallie Mae Upromise Rewards program. Ratings Rationale: As of May 29, it was Moody's understanding that, following the division, all of SLM's preferred stock would also be housed in Newco. SLM has since clarified that the preferred stock will remain with the SLM Corp. holding company, rather than being housed in Newco. The review action initiated on May 29 is unaffected by this clarification and all of SLM's unsecured debt and preferred stock ratings remain on review for possible downgrade. The principal methodology used in this rating was Finance Company Global Rating Methodology published in March 2012. SMART & FINAL: S&P Revises Outlook to Stable & Affirms 'B' CCR -------------------------------------------------------------- Standard & Poor's Ratings Services said it revised its outlook on Commerce, Calif.-based grocery store operator Smart & Final Holdings Corp. to stable from negative. S&P affirmed its 'B' corporate credit rating. At the same time, S&P affirmed its 'BB-' issue-level rating (two notches above the corporate credit rating) on the company's $150 million ABL revolving credit facility, S&P's 'B' issue-level rating (the same as the corporate credit rating) on the first-lien term loan (to be upsized to $580 million with the proposed transaction), and S&P's 'CCC+' issue-level rating (two notches below the corporate credit rating) on the second-lien term loan (to be paid down to $140 million with the proposed transaction). The recovery ratings of '1' (indicating very high expectations of recovery for lenders in the event of default), '3' (meaningful recovery expectations), and '6' (negligible recovery expectations), respectively, remain unchanged. "The outlook revision to stable from negative reflects our revised forecast, including our view that credit measures will improve over the next 12 months, with leverage declining below 6.5x at fiscal year-end 2013," said credit analyst Nalini Saxena. "We believe continued good same-store sales growth and slightly improved EBITDA margins will support this forecast. We also expect the sponsor, which purchased the company via a leveraged buyout in November 2012, to influence financial governance toward debt reduction in 2013 and 2014." The stable outlook reflects S&P's view that credit measures have shown signs of improvement following the leveraged buyout and will continue to moderately improve thanks to positive operating trends. S&P could consider a downgrade if the company is unable to meet its expectations for operating performance and credit measures such that S&P's leverage remains above 6.5x. This could occur, for example, if sales growth slows to the 4%-area, perhaps due to increased competition, and margins remain flat. Although less likely at this time, S&P could consider an upgrade if the company reduces debt and its operating performance exceeds S&P's expectations such that leverage approaches the 5x area. This could occur, for example, if revenues increase 12%, EBITDA margin increases 100 basis points, and debt is reduced $75 million from current levels. S&P believes this would require market share gains against competitors, a more favorable product mix, and a moderation in financial policy. SMITHFIELD FOODS: Moody's Reviews Ratings After Merger Pact ----------------------------------------------------------- Moody's Investors Service has placed the long-term debt ratings of Smithfield Foods, Inc. under review direction uncertain following the company's announcement yesterday that it had entered into a merger agreement with China-based Shuanghui International in a transaction valued at approximately $7.1 billion. The transaction is subject to shareholder and regulatory approval, which the companies expect to receive in the second half of 2013. Moody's affirmed Smithfield's SGL-1 Speculative Grade Liquidity rating. Rating Rationale The direction of a possible change in Smithfield's ratings is uncertain. "We currently do not have sufficient details on the proposed transaction to understand the overall effect on the company's credit profile, but it is likely to be significant," said Brian Weddington, a Moody's Senior Credit Officer. Moody's review will focus on details of the merger agreement, the post-closing capital structure proposed for Smithfield, and the terms of related financing arrangements as they become available. Moody's will also assess the credit profile of Shuanghui and its likely influence on Smithfield's future business profile. Ratings placed under review, direction uncertain: Corporate Family at Ba3; Probability of Default at Ba3-PD; Senior unsecured debt at B1 (LGD 5, 75%); Senior unsecured shelf at (P)B1. Ratings affirmed: Speculative Grade Liquidity Rating at SGL-1. On May 29, 2013 Smithfield and Shuanghui announced that they had entered into a definitive merger agreement valued at approximately $7.1 billion, including the assumption of Smithfield debt. Under the agreement, Shuanghui will acquire all the outstanding shares of Smithfield at a price of $34/share or approximately $4.7 billion, a 31% premium to the previous day closing share price. As of January 2013, Smithfield reported approximately $2.4 billion of debt. Shuanghui, currently an important export customer for Smithfield, intends to operate Smithfield under the existing management team as an independent operating subsidiary. Smithfield's current Ba3 Corporate Family Rating reflects its global leadership in hog production and pork processing balanced against its single-protein focus that results in high exposure to commodity price volatility. The company's key growth opportunities include expansion into global export markets, particularly in emerging markets, and further development of its processed and branded meats portfolio, which have greater profit margin potential. Should the resulting capital structure and credit profile be stronger than Smithfield's is currently, the ratings could be upgraded. However if the transaction is financed largely with debt, which results in a financial burden on Smithfield, ratings could be downgraded. The principal methodology used in this rating was the Global Food - Protein and Agriculture Industry published in September 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. Smithfield Foods, Inc., headquartered in Smithfield, Virginia, is the world's largest pork producer and processor. Sales for the twelve months fiscal year ended January 27, 2013 were approximately $13.1 billion. SOUTHERN OAKS: June 25 Hearing on Adequacy of Plan Outline ---------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of Oklahoma will convene a hearing on June 25, 2013, at 2:30 p.m., to consider adequacy of the Disclosure Statement explaining the Southern Oaks Of Oklahoma LLC's proposed Second Amended Plan of Reorganization. The Plan dated May 15, 2013, provides that general unsecured creditors are classified in Class 20, and will receive a distribution of 100% of their allowed claims, with interest in 60 equal monthly installments or as earlier paid in full. Payments and distributions under the Plan will be funded by (i) rents, issues and profits of the property of the Debtor; (ii) rents, issues and profits of property of the members or affiliates of the Debtor; (iii) sales of property or refinancing of debt before maturity; and contributions by the members of the Debtor. A copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/SOUTHERN_OAKS_ds.pdf About Southern Oaks Southern Oaks of Oklahoma, LLC, owns a 126-unit apartment complex in south Oklahoma City, 115 single family residences, 10 residential duplexes and 4 commercial properties in the Oklahoma City Metro area and a 100 unit apartment complex in Pryor, Oklahoma. The Company operates the non-apartment properties by and through an affiliate property management company, Houses For Rent of OKC, LLC, who advertises, leases, collects rents, pays expenses, provides equipment, labor and materials for maintenance, repairs and make-ready services. The Company filed for Chapter 11 bankruptcy (Bankr. W.D. Okla. Case No. 12-10356) on Jan. 31, 2012. Judge Niles L. Jackson presides over the case. Ruston C. Welch, at Welch Law Firm, P.C., represents the Debtor as counsel. It scheduled $14,788,414 in assets and $15,352,022 in liabilities. The petition was signed by Stacy Murry, manager of MBR. Affiliates that filed separate Chapter 11 petitions are Charlemagne of Oklahoma, LLC (Bankr. W.D. Okla. Case No. 10-13382) on July 2, 2010; and Brookshire Place, LLC (Bankr. W.D. Okla. Case No. 11-10717) on Feb. 23, 2011. Southern Oaks owns a 126-unit apartment complex in south Oklahoma City, 115 single family residences, 10 residential duplexes and 4 commercial properties in the Oklahoma City Metro area and a 100 unit apartment complex in Pryor, Oklahoma. Southern Oaks operates the non-apartment Properties by and through an affiliate property management company, Houses For Rent of OKC LLC, who advertises, leases, collects rents, pays expenses, provides equipment, labor and materials for maintenance, repairs and make ready services. On Jan. 12 and 27, 2012, the Debtor's ownership and operation of the Properties was consolidated by the merger of various affiliate entities with the Debtor being the surviving entity. Those entities are Southern Oaks Of Oklahoma, LLC; Quail 12, LLC; Quail 13, LLC; 1609 N.W. 47th, LLC; 2233 S.W. 29th, LLC; 400 S.W. 28th, LLC; South Robinson, LLC; 9 on S.E. 27th, LLC; Southside 10, LLC; QCB 08, LLC; and Prairie Village of Oklahoma, LLC. STAFFORD LOGISTICS: Moody's Rates New $130 Million Debt 'B3' ------------------------------------------------------------ Moody's Investors Service assigned B3 corporate family and Caa1-PD probability of default ratings to Stafford Logistics Holdings, Inc., doing business as Custom Ecology, Inc. Moody's also assigned B3 ratings to the company's proposed $10 million revolving credit and $120 million first lien term facility. The outlook is stable. Ratings Corporate Family Rating: assigned B3 Probability of Default Rating: assigned Caa1-PD $10 million Revolving Credit Agreement: assigned B3/LGD 3-31% $120 million First Lien Term Loan: assigned B3/LGD 3-31% Outlook: Stable Ratings Rationale: The B3 corporate family rating is driven by the company's modest scale (annual run-rate revenue around $130 million) and limited operating history (acquisitions have nearly tripled revenue base since late 2011. Moody's expects limited free cash flow over the forecast period as the company invests in growth capex, limiting potential debt reduction. Revenue decline risk is elevated with the top customer accounting for 40% and the top 5 account 88% of revenue, offsetting these customers' positions as the leading solid waste collection companies in the US. These challenges are somewhat offset by leverage in line with B1 (around 4.3x Moody's adjusted debt/EBITDA for latest twelve months ending March 31, 2013, pro-forma for the proposed transaction) the company's reputation for providing reliable service, low cost operations which should protect strong local market shares, and multi-year customer contracts (3.6 years on average, as of May 2013). The company's recent investments upgrading its tractor-truck fleet is expected to limit maintenance capex in the near term, while the expected increased use of owner-operator vehicles (where non- employee drivers provide their own trucks) improves the company's cost structure flexibility. Moody's expects the company's primary business of hauling waste from transfer station to landfill to continue to be heavily outsourced by the waste collection operators to Custom Ecology and peers as the business generates lower margins than other segments of waste process (mid-high teen percent EBITDA margins for typical providers, higher for operators like Custom Ecology with scale). In addition, outsourcing to haulers improves fleet and labor efficiency in most cases as the same driver can make landfill runs on behalf of different contracted operators over the course of a shift, another outsourcing benefit for the waste collection companies. The company also operates transfer stations on behalf of solid waste owners, though Moody's is less sanguine on the growth prospects for this segment. Moody's ratings also assume the company maintains a capital structure in line with the current proposal. Custom Ecology's liquidity is adequate with nearly all the $10 million revolver available and about $16 million unrestricted cash pro-forma for this transaction as of March 31, 2013. Annual debt amortization for the new facilities will be just over $1 million in addition to the $1-2 million capital lease amortization, and annual maintenance capex is expected to low single digit million dollars over the next 18 months, leading to modest free cash flow. The covenants on the new facilities are expected to be set at levels providing the company with generous room. The outlook is stable as the landfill disposal volumes are expected to increase slowly through mid-2014 and little additional outsourcing of transfer station management is anticipated. Additional revenue growth may develop through market share gains in long haul transportation of hazardous waste, though this segment seems highly competitive. The company may also expand in to neighboring geographies to its current footprint, though this would require additional capital with intermediate term payoff. The first lien revolver and term loan were rated B3, in line with the corporate family rating, as they comprise nearly all the company's debt. As this debt is first lien bank debt, Moody's Loss Given Default methodology assumes a 65% average recovery in a default scenario, or higher than the standard 50% family recovery assumption. The result is a higher expected probability of default, leading to the Caa1-PD probability of default rating. Rating improvement could be driven, the company increasing the revenue base to over $500 million, increasing customer diversification where top five customers comprise less than 60% revenue, leverage declining below 4x, and by management demonstrating its skill running the company at its current size. Rating deterioration could be driven by liquidity (unrestricted cash and revolver availability) declining below $15 million, the loss of a key customer (who's revenue accounted for 10%+ of total revenue), or leverage increasing over 5x. The principal methodology used in this rating 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. Mableton, GA, headquartered Stafford Logistics operates under the name Custom Ecology and generates around $130 million run-rate revenue as of March 31, 2013. The company primarily provides long distance (50 miles or more) hauling of solid waste from transfer stations to regional landfills on behalf of solid waste collection customers. The company also operates transfer stations and owns landfill based assets which efficiently deposit waste in to the landfills. The company is majority owned by entities affiliated with Kinderhook Industries, a private equity firm. STAMP FARMS: Files Plan of Liquidation With Committee's Support --------------------------------------------------------------- Stamp Farms, LLC, et al., and the Official Committee of Unsecured Creditors filed with the Bankruptcy Court a Disclosure Statement explaining the Joint Plan of Liquidation dated May 9, 2013. According to the Disclosure Statement, the Plan provides that Liquidation Administrative Expenses will be paid from the Liquidating Trust Assets. The Liquidating Trust Initial Budget of $500,000 will be reserved from the Class 3 Allocation on to cover the expenses of the Liquidating Trust, including professional fees, expert witness fees, and other costs of prosecution of litigation in connection with the Recovery Actions. The Plan provides that O'Keefe & Associates will be the Liquidating Trustee. The Liquidating Trust will be managed by the Steering Committee, which will be comprised of 3 members, one of whom will be selected by the Committee and two of whom will be selected by Wells Fargo. Under the Plan, PMSI Secured Lenders (Class 1) will be paid from the allocated portions of the proceeds of the sales. Claims of Wells Fargo Bank (Class 2) will receive the Class 2 Allocation on account of its Allowed Class 2 Claims. General Unsecured Claims (Class 3) the Class 3 Allocation is $2,700,000 and accordingly the recoveries to holders of Class 3 General Unsecured Claims, excluding any Deficiency Claim of Wells Fargo, is estimated at 10%. Membership Interests (Class 4) will be canceled under the Plan and no distributions will be made to the Holders of the membership interests. A copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/STAMP_FARMS_ds.pdf About Stamp Farms Stamp Farms, L.L.C., and three affiliates sought Chapter 11 protection (Bankr. W.D. Mich. Lead Case No. 12-10410) on Nov. 30, 2012, in Grand Rapids, Michigan. Stamp Farms began in 1968 with its purchase of 168 acres of farmland in Decatur, Michigan. The family was also heavily involved in the swine industry, operating a 500 sow swine operation until 1995. In 1997, Mike Stamp took over operations of Stamp Farms' 1500 acres and has grown the farm operation to cover 20,000+ acres across six southwestern Michigan counties. Stamp Farms sells its grain to Northstar Grain, L.L.C., solely owned by Mike Stamp, which conducts a grain elevator business on land it owns and leases and upon which buildings, grain storage bins, grain loading and related equipment and rail spurs are located. Stamp Farms estimated at least $10 million in assets and at least $50 million in liabilities in its bare-bones petition. Mr. Stamp also filed a Chapter 11 petition (Case No. 12-10430). Judge Scott W. Dales oversees the case. The Debtors are represented by Michael S. McElwee, Esq., and Robert D. Mollhagen, Esq., at Varnum LLP. O'Keefe & Associates Consulting, L.L.C. serves as financial restructuring advisors. The Official Committee of Unsecured Creditors tapped Steve Jakubowski, Esq., at Robbins, Salomon & Patt, Ltd., as its counsel, and Emerald Agriculture, LLC, as its financial consultant. STAR BUFFET: Sells Real Estate Property to Repay Wells Fargo ------------------------------------------------------------ Star Buffet, Inc. on May 31 disclosed that the company has sold its former JJ North's Country Buffet in Yuma, Arizona. Proceeds from the real estate sale were used to repay Wells Fargo Bank, N.A. in accordance with the company's Second Amended Joint Plan of Reorganization which was approved by the United States Bankruptcy Court for the District of Arizona on December 17, 2012. "This real estate sale represents the second in a series of anticipated asset sales in the current fiscal year whereby proceeds are being used to reduce the outstanding Wells Fargo loan balance," said Robert E. Wheaton, Star Buffet's president. About Star Buffet Star Buffet, Inc. is a multi-concept restaurant operator. As of January 22, 2013, Star Buffet, Inc. through its subsidiaries, operated seven 4B's restaurants, five JB's restaurants, three K- BOB'S Steakhouses, three Barnhill's Buffet restaurants, two Western Sizzlin restaurants, two JJ North's Country Buffet restaurants, two Pecos Diamond Steakhouses, one Casa Bonita Mexican theme restaurant, one BuddyFreddys restaurant and one Bar- H Steakhouse. Based in Arizona, Star Buffet, Inc. filed for Chapter 11 protection (Bankr. D. Ariz. Case No. 11-27518) on Sept. 28, 2011. Judge George B. Nielsen Jr. presides over the case. S. Cary Forrester, Esq., at Forrester & Worth, PLLC, represents the Debtor. The Debtor estimated both assets and debts of between $1 million and $10 million. Summit Family Restaurants Inc. filed a voluntary petition for reorganization under Chapter 11 on Sept. 29, 2011. The cases are being jointly administered. None of the Company's other subsidiaries were included in the bankruptcy filing. STEWART ENTERPRISES: S&P Puts 'BB-' Rating on CreditWatch Dev. -------------------------------------------------------------- Standard & Poor's Ratings Services said it placed its 'BB-' senior unsecured ratings on Stewart Enterprises Inc. on CreditWatch with developing implications, following the announcement that Service Corp. International will acquire the company in an all cash transaction. If the debt remains outstanding, S&P will determine final ratings based on the debt's priority in the newly combined capital structure. S&P could raise its rating to equal its corporate credit rating on Service Corp. or lower them as much as two notches below. The 'BB' corporate credit rating on Stewart Enterprises is unaffected by the announcement. S&P will withdraw the rating after the transaction closes. Ratings List Stewart Enterprises Inc. Corporate Credit Rating BB/Stable/-- Ratings Affirmed; CreditWatch Action; Recovery Rating Unchanged Stewart Enterprises Inc. Senior Unsecured BB-/Watch Dev BB- Recovery Rating 5 SUNSTONE COMPONENTS: Files Schedules of Assets and Liabilities -------------------------------------------------------------- Molding International and Engineering, Inc., and its affiliates filed with the U.S. Bankruptcy Court for the Central District of California their respective schedules of assets and liabilities, disclosing: Company Assets Liabilities ------- ------ ----------- Sunstone Components Group, Inc. $1,298,267 $16,214,755 Sunstone Advantage, Inc. $298,681 $15,583,047 Molding International, the Debtor with the largest assets, disclosed these figures in its schedules: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $0 B. Personal Property $2,859,617 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $11,722,208 E. Creditors Holding Unsecured Priority Claims $125,114 F. Creditors Holding Unsecured Non-priority Claims $4,475,598 ----------- ----------- TOTAL $2,859,617 $16,322,920 A copy of the schedules is available for free at http://bankrupt.com/misc/MOLDING_INTERNATIONAL_sal.pdf About Sunstone Components Group Headquartered in Temecula, California, Sunstone Components Group is a provider of precision metal stamping and insert injection moldings. Snowbird Capital Mezzanine Fund, a subordinate secured lender owed $6.7 million by Sunstone Components Group, Inc., filed an involuntary Chapter 11 bankruptcy petition for Sunstone on April 5, 2013 (Bankr. C.D. Cal. Case No. 13-16232). Snowbird also filed an involuntary Chapter 11 case against Molding International and Engineering, Inc. (Bankr. C.D. Cal. Case No. 13- 16235) on April 5. The Debtors are represented by attorneys at Landau Gottfried & Berger, LLP. The petitioner is represented by Mark B. Joachim, Esq., at Arent Fox, LLP. Bankruptcy Judge Meredith A. Jury presides over the case. Comerica Bank, owed about $5.1 million, is the senior secured lender. The bank is providing an additional $220,000 loan for the bankruptcy. On May 2, 2013, the company consented to being in Chapter 11 order to sell substantially all of the Company's assets. SUNSTONE COMPONENTS: Five-Member Creditors Committee Formed ----------------------------------------------------------- Peter C. Anderson, the U.S. Trustee for Region 16, appointed five creditors to serve on an Official Committee of Unsecured Creditors in the Chapter 11 cases of Sunstone Components Group, Inc., et al. The Committee is comprised of: 1. Ecko Products Group Attn: Chris Hively 12615 Colony St. Chino, CA 91710 Tel: (909) 628-5678 2. Epic Freight Solutions Attn: Robert Reis 15901 Hawthorne Blvd., Suite 490 Lawndale, CA 90260 Tel: (818) 464-3742 3. Hyland Machine Company Attn: F. Dan Hyland 1900 Kuntz Road Dayton, OH 45404 Tel: (937) 233-8600 4. Lit. Econ, LLP Attn: D. Hanson 1551 N. Tustin Avenue, Suite 540 Santa Ana, CA 92705 Tel: (714) 542-5522 ext. 203 5. Snowbird Capital Mezzanine Fund I, LP Attn: Nelson Carbonell 11921 Freedom Drive, Suite 1120 Reston, Virginia 20190 Tel: (703) 955-4057 The U.S. Trustee for Region 16 will convene a meeting of creditors in the Chapter 11 cases of Molding International and Engineering Inc., et al. on June 17, 2013, at 2:30 p.m. Headquartered in Temecula, California, Sunstone Components Group is a provider of precision metal stamping and insert injection moldings. Snowbird Capital Mezzanine Fund, a subordinate secured lender owed $6.7 million by Sunstone Components Group, Inc., filed an involuntary Chapter 11 bankruptcy petition for Sunstone on April 5, 2013 (Bankr. C.D. Cal. Case No. 13-16232). Snowbird also filed an involuntary Chapter 11 case against Molding International and Engineering, Inc. (Bankr. C.D. Cal. Case No. 13-16235) on April 5. The Debtors are represented by attorneys at Landau Gottfried & Berger, LLP. The petitioner is represented by Mark B. Joachim, Esq., at Arent Fox, LLP. Bankruptcy Judge Meredith A. Jury presides over the case. Comerica Bank, owed about $5.1 million, is the senior secured lender. The bank is providing an additional $220,000 loan for the bankruptcy. On May 2, 2013, the company consented to being in Chapter 11 order to sell substantially all of the Company's assets. SUNSTONE COMPONENTS: Taps Landau Gottfried as Bankruptcy Counsel ---------------------------------------------------------------- Sunstone Components Group, Inc., et al., ask the U.S. Bankruptcy Court for the Central District of California for permission to employ Landau Gottfried & Berger LLP as bankruptcy counsel; and authorize the firm to draw down on the Chapter 11 retainer. The hourly rates of LGB's personnel are: Michael Gottfried $550 Monica Rieder $395 Lawyers $330 - $535 Law Clerk and Paralegal $150 - $200 The Debtors paid $25,000 to LGB as an advance fee retainer To the best of the Debtor's knowledge, LGB is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Sunstone Components Group Headquartered in Temecula, California, Sunstone Components Group is a provider of precision metal stamping and insert injection moldings. Snowbird Capital Mezzanine Fund, a subordinate secured lender owed $6.7 million by Sunstone Components Group, Inc., filed an involuntary Chapter 11 bankruptcy petition for Sunstone on April 5, 2013 (Bankr. C.D. Cal. Case No. 13-16232). Snowbird also filed an involuntary Chapter 11 case against Molding International and Engineering, Inc. (Bankr. C.D. Cal. Case No. 13-16235) on April 5. The Debtors are represented by attorneys at Landau Gottfried & Berger, LLP. The petitioner is represented by Mark B. Joachim, Esq., at Arent Fox, LLP. Bankruptcy Judge Meredith A. Jury presides over the case. Comerica Bank, owed about $5.1 million, is the senior secured lender. The bank is providing an additional $220,000 loan for the bankruptcy. On May 2, 2013, the company consented to being in Chapter 11 order to sell substantially all of the Company's assets. SUNSTONE COMPONENTS: Taps Three Twenty One as Investment Banker --------------------------------------------------------------- Sunstone Components Group, Inc., et al., ask the U.S. Bankruptcy Court for the Central District of California for permission to employ Three Twenty One Capital Partners, LLC, as their investment banker. 321 has been acting in that capacity since February 2013, when the Debtors first retained 321 to seek an equity investment, refinancing or other restructuring transaction. 321 will assist the Debtors in the completion of the marketing and sale process they commenced. The Debtors propose to compensate 321 by paying 321 a commission equal to a percentage of the sale price for the Debtors' assets. Specifically, 321 will receive a commission equal to six percent of the first $1 million of the sale proceeds; five percent of the sale proceeds between $1 million and $2 million; four percent of the sale proceeds between $2 million and $3 million; three percent of the sale proceeds between $3 million and $5 million; and two percent of the sale proceeds over $5 million, provided however that any portion of the fee that is based on the amount of assumed liabilities will be capped at $50,000. To the best of the Debtor's knowledge, 321 is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Sunstone Components Group Headquartered in Temecula, California, Sunstone Components Group is a provider of precision metal stamping and insert injection moldings. Snowbird Capital Mezzanine Fund, a subordinate secured lender owed $6.7 million by Sunstone Components Group, Inc., filed an involuntary Chapter 11 bankruptcy petition for Sunstone on April 5, 2013 (Bankr. C.D. Cal. Case No. 13-16232). Snowbird also filed an involuntary Chapter 11 case against Molding International and Engineering, Inc. (Bankr. C.D. Cal. Case No. 13-16235) on April 5. The Debtors are represented by attorneys at Landau Gottfried & Berger, LLP. The petitioner is represented by Mark B. Joachim, Esq., at Arent Fox, LLP. Bankruptcy Judge Meredith A. Jury presides over the case. Comerica Bank, owed about $5.1 million, is the senior secured lender. The bank is providing an additional $220,000 loan for the bankruptcy. On May 2, 2013, the company consented to being in Chapter 11 order to sell substantially all of the Company's assets. T-L BRYWOOD: Continued Hearing on Use of Cash Collateral Set Today ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Northern District of Illinois continued today, June 3, 2013, at 10:45 a.m., at 5400 Federal Plaza, Courthouse 8, Hammond, Indiana, the hearing to consider T-L Brywood LLC's request to further use cash collateral. About T-L Brywood T-L Brywood LLC filed for Chapter 11 bankruptcy (Bankr. N.D. Ill. Case No.12-09582) on March 12, 2012. T-L Brywood owns and operates a commercial shopping center known as the "Brywood Centre" -- http://www.brywoodcentre.com/-- in Kansas City, Missouri. The Property encompasses roughly 25.6 acres and comprises 183,159 square feet of retail space that is occupied by 12 operating tenants. The occupancy rate for the Property is approximately 80%. The Debtor and lender The PrivateBank and Trust Company reached an impasse over the terms and conditions of another extension of a mortgage loan on the Property. As a result, the Debtor filed the Chapter 11 case to protect the Property from foreclosure while the Debtor formulates an exit strategy from the reorganization case. As of the Petition Date, no foreclosure relating to the Property had been filed by the Lender. Judge Donald R. Cassling oversees the case. The Debtor is represented by David K. Welch, Esq., Arthur G. Simon, Esq., and Jeffrey C. Dan. Esq., at Crane, Heyman, Simon, Welch & Clar, in Chicago. The Debtor disclosed total assets of $16,666,257 and total liabilities of $13,970,622 in its schedules. The petition was signed by Richard Dube, president of Tri-Land Properties, Inc., manager. PrivateBank is represented by William J. Connelly, Esq., at Hinshaw & Culbertson LLP. TELECOMMUNICATIONS MGT: Cable Acquisition No Impact on Moody's CFR ------------------------------------------------------------------ Moody's Investors Service said that the proposed acquisition of Cable Management Associates for approximately $50 million does not impact the B3 corporate family of Telecommunications Management, LLC (NewWave). NewWave plans to finance the transaction with a $55 million add-on to its first lien term loan. The B2 rating on the first lien and the Caa2 rating on the second lien remain unchanged as well, as the transaction does not materially impact the mix of debt capital. CMA is an incumbent cable provider operating primarily in eastern Texas and northern Louisiana, with limited operations in Mississippi and Nevada. Telecommunications Management, LLC Senior Secured First Lien Bank Credit Facility, B2, LGD adjusted to LGD3, 37% from LGD3, 34% Senior Secured Second Lien Bank Credit Facility, Caa2, LGD adjusted to LGD5, 89% from LGD5, 86% The transaction does not materially impact NewWave's leverage, estimated in the mid to high 6 times debt-to-EBITDA range. The incremental capital expenditures necessary to upgrade CMA will pressure already weak free cash flow, but Moody's expected NewWave's expansion strategy to delay a substantial improvement in metrics. Also, GTCR, which acquired NewWave this month, will contribute $10 million of cash equity in conjunction with the transaction, which will boost liquidity. CMA's weaker penetration will pull down NewWave's already weak operating metrics, and the acquisition poses some execution risk given the need to upgrade the plant. However, given the favorable competitive environment in CMA's territory, Moody's sees opportunity for growth in high speed data and commercial customers once NewWave upgrades CMA's network, and the combination enhances scale. With no geographic overlap, Moody's expects minimal operating synergies, but NewWave can likely improve CMA's cost structure and bring margins more in line with NewWave margins. The principal methodology used in this rating was Global Pay Television - Cable and Direct-to-Home Satellite Operators published in April 2013. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Telecommunications Management, LLC (operating under the brand name NewWave) provides video, high speed data, and voice to about 90,000 residential and commercial customers in southeast Missouri, Arkansas, southern and western Indiana, and southern and eastern Illinois. GTCR acquired NewWave from Pamlico Capital in May 2013 through its previously established partnership with Rural Broadband Investments, which acquires and invests in rural-focused cable systems serving residential and commercial customers in small-to-middle sized markets and rural geographies. TRANSVANTAGE SOLUTIONS: U.S. Trustee to Appoint Ch. 11 Trustee -------------------------------------------------------------- The U.S. Bankruptcy Court for the District of New Jersey directed the U.S. Trustee to appoint a Chapter 11 trustee in the case of TransVantage Solutions, Inc. As reported by the Troubled Company Reporter on May 7, 2013, the Debtor filed for Chapter 11 protection and a motion for trustee to take over management of the Debtor. "Various of the creditors of the Debtor made it clear they no longer trust me to run the Debtor's business operations. Therefore, I believe that it would be in the best interest of the creditors if an independent trustee were to be appointed for this purpose," Shirley Sooy, president of the Debtor, said in court filings. The Chapter 11 bankruptcy was filed when certain customers filed lawsuits against the Debtor, and one of the customers froze the Debtor's operating account. As a result, the Debtor was unable to continue operations. Ms. Sooy says the Debtor has a potential to satisfy claims of various creditors through a Chapter 11 plan. The Debtors has developed freight payment technology, which if properly administered, marketed, and licensed can bring in significant sums of money that can be used to fund a plan of reorganization, she claims. The Debtor disclosed assets of $71.3 million and liabilities of $41.3 million in its schedules. The Debtor does not have any real property, and its primary asset is a $71 million claim against Johnson Controls. The Debtor says it does not have any secured creditors. Branchburg, New Jersey-based TransVantage Solutions, Inc., doing business as Freight Traffic Services, provides billing and payment services to shippers or receivers of goods. The Company filed a Chapter 11 petition (Bankr. D.N.J. Case No. 13-19753) in Trenton, New Jersey on May 4, 2013, and immediately filed a motion for Chapter 11 trustee to take over management of the Debtor. The petition was signed by Shirley Sooy as president. John F. Bracaglia, Jr., Esq., at Cohn, Bracaglia & Gropper serves as the Debtor's counsel. The Debtor disclosed assets in $71,260,000 and scheduled liabilities in $41,319,266 in its schedules. TRIUMPH GROUP: S&P Revises Outlook to Stable & Affirms 'BB' CCR --------------------------------------------------------------- Standard & Poor's Ratings Services said that it revised its outlook on Berwyn, Pa.-based Triumph Group Inc. to stable from positive. At the same time, S&P affirmed all other ratings, including the 'BB' corporate credit rating. "The outlook revision reflects Standard & Poor's expectation that credit metrics will not approach levels that we believe could warrant an upgrade in the next 12 months, including debt to EBITDA below 2.5x," said Standard & Poor's credit analyst Christopher DeNicolo. Capital expenditures and expenses related to the company's relocation and shut-down of operations at its Jefferson Street facility, and increases in debt from recent acquisitions have resulted in weaker-than-expected credit ratios for 2013. Although S&P expects strength in commercial aerospace, contributions from new and existing programs, acquisition synergies, and continued debt and pension reductions from strong free cash flows to result in improving credit ratios, S&P do not believe they will improve to levels warranting an upgrade within the next 12 months. S&P now expects debt to EBITDA to remain above 2.5x in fiscal 2014 (ending March 31, 2014) and funds from operations (FFO) to debt of 30%-35%, compared with prior expectations of about 2x and above 35%, respectively. However, S&P expects further improvement in fiscal 2015 if current trends continue and the company completes the Jefferson Street move successfully. "We assess Triumph's business risk profile as "fair," given its participation in the competitive and cyclical commercial aerospace market, for which the company is a major supplier. Offsetting this factor somewhat is its presence on a range of commercial aircraft, as well as business jets and military aircraft, which provide meaningful diversity. We view the company's financial risk as "significant," reflecting credit protection measures that are somewhat better than average for the rating, with debt to EBITDA of about 3x, FFO to debt of about 30%, and "adequate" liquidity," S&P said. The outlook is stable. A strong commercial aerospace market, contributions from recent acquisitions, and new program wins should result in solid revenue and earnings growth for the next few years despite weakness in the military sector. S&P expects the company to continue to use excess cash flows toward debt reduction and to make voluntary pension contributions, but also to pursue small to midsize acquisitions. S&P could consider an upgrade if total debt to EBITDA declines below 2.5x and FFO to debt improves to the mid-30% area. Although less likely, S&P could lower the rating if weaker-than-expected commercial aerospace conditions, operational issues relating to the Jefferson Street move, higher debt to fund acquisitions, or delays on new programs result in debt to EBITDA increasing to more than 3.5x and FFO to debt declining below 20%. VEECO INSTRUMENTS: Gets NASDAQ Listing Non-Compliance Notice ------------------------------------------------------------ Veeco Instruments Inc. on May 31 disclosed that on May 24, 2013, Veeco received the anticipated letter from The NASDAQ Stock Market LLC notifying the Company that it has not regained compliance with NASDAQ Listing Rule 5250(c)(1), the continued listing requirement to timely file all required periodic reports with the Securities and Exchange Commission, and, therefore, that its common stock would be subject to delisting unless the Company timely requests a hearing before a NASDAQ Listing Qualifications Panel. Accordingly, the Company has requested a hearing before the Panel. At the hearing, the Company will present its plan for regaining compliance with the Rule, and request continued listing pending its return to compliance. The hearing request will result in an automatic stay of delisting until at least June 17, 2013. Concurrent with the hearing request, the Company has asked the Panel to extend the stay until the conclusion of the hearing process. The Panel has the discretion to grant the Company an extension of time within which to regain compliance with the Rule for a period not to exceed 360 days from the original due date for the first late filing, or November 4, 2013. There can be no assurance that the Panel will grant the Company's request for continued listing. As previously reported, the Company is not in compliance with the Rule because it did not timely file its quarterly report on Form 10-Q for the quarter ended March 31, 2013, its annual report on Form 10-K for the year ended December 31, 2012 and its quarterly report on Form 10-Q for the quarter ended September 30, 2012 because the Company is reviewing the timing of the recognition of revenue and related expenses on the sale of certain of its products. The accounting review was announced on November 15, 2012. For information on the accounting review, please click here to visit Veeco's May 10, 2013 12b-25 filing. The Company continues to conduct the review and intends to file its Forms 10-Q and 10-K as soon as reasonably practicable after these accounting matters have been resolved. About Veeco Veeco -- http://www.veeco.com-- is a provider of process equipment solutions enable the manufacture of LEDs, power electronics, hard drives, MEMS and wireless chips. VIDEOTRON LTEE'S: Moody's Says Rogers Pact is Credit-Positive ------------------------------------------------------------- Moody's Investors Service said Videotron Ltee's (a wholly-owned subsidiary of Quebecor Media Inc. [Ba3, stable]) agreement with Rogers Communications Inc. (Rogers; Baa1, stable) to jointly build-out an expanded LTE wireless services network in the province of Quebec and the Ottawa region of Ontario, is credit- positive and ratings-neutral. Headquartered in Montreal, Canada, Quebecor Media Inc. (QMI) is a privately held leading Canadian media holding company with interests in cable distribution, wireline and wireless telecommunications (Videotron Ltee (Videotron)), news media (including newspaper publishing at Sun Media Corporation and Canoe Internet portal), television broadcasting (TVA Group Inc. (TVA)), book, magazine and video retailing, publishing and distribution, music recording, production and distribution, leisure and entertainment and interactive media services (Nurun). Some 90% of QMI's EBITDA is generated by Videotron with 7% coming from publishing and the approximately 3% balance split amongst broadcasting, leisure and entertainment and interactive services. WAUPACA FOUNDRY: S&P Affirms 'B+' CCR Following $125MM Loan Add-On ------------------------------------------------------------------ Standard & Poor's Ratings Services said that it affirmed its 'B+' corporate credit rating on Waupaca Foundry Inc. following the company's announcement that it plans to increase its existing term loan by $125 million to $542 million outstanding at close. The outlook is stable. At the same time, S&P affirmed the issue ratings on Waupaca's term loan at 'B+' with recovery ratings of '3', indicating S&P's expectations for meaningful (50%-70%) recovery in the event of a payment default. The company intends to use the proceeds from the add-on term loan to fund shareholder distributions. The ratings reflects what Standard & Poor's considers to be Waupaca's "weak" business risk profile and "aggressive" financial risk profile. "Our business risk assessment reflects the company's exposure to cyclical auto production levels, the fragmented nature of the castings industry, and Waupaca's reported leading share in its end markets," said Standard & Poor's credit analyst Nishit Madlani. The financial risk assessment is based on S&P's expectations for moderate leverage and prospects for sustained positive free cash flow generation over the next two years, tempered by the potential for volatility in the face of high operating leverage in a cyclical sector and the company's private-equity ownership. Waupaca has a reported dominant market position as a manufacturer of gray and ductile iron castings for the automotive, commercial vehicles, agriculture, construction, and hydraulics-related end markets. The company will use the additional proceeds from the $125 million add-on term loan to fund another shareholder distribution, following the $200 million add-on term loan earlier this year. Pro forma leverage increases to 3.7x (S&P's adjustments to debt include pension and other postemployment benefit [OPEB] obligations) at close based on estimated EBITDA for the 12 months ended May 31, 2013). As a result, there is reduced cushion compared with S&P's original ratings expectations in Waupaca's credit measures (for the current rating) to withstand future operating shortfalls. Under S&P's base case, it expects leverage to approach roughly 3.3x over the next 12-18 months, given its assumption of sustained low-double-digit EBITDA margins and the company's mandatory amortization on the term loan, which remains at 5% per year. Waupaca also benefitted from meaningfully improved pricing through its November 2012 transaction, followed by another repricing transaction in April 2013, both of which S&P viewed as a credit positive. In S&P's opinion, Waupaca's EBITDA margin is somewhat better than the auto-supplier industry average and benefits partly from improved capacity utilization. Though the overall iron castings industry in North America remains rather fragmented, Waupaca has fewer competitors in its end markets, following a meaningful capacity reduction within this segment in 2009-2010. S&P's stable outlook reflects its belief that Waupaca can sustain positive discretionary cash flow into 2013 with sustained year- over-year improvement in EBITDA margins and liquidity (cash and bank facility availability) of at least $50 million to $70 million. S&P assumse, for its outlook, that light- and heavy- vehicle production will rise in North America over the next 12 months. S&P could lower its rating if it believes free operating cash flow generation will turn negative and remain so for a sustained period of time, or if debt to EBITDA, including its adjustments, trends toward 4.5x or higher. For example, S&P estimates this could occur if Waupaca's EBITDA margins fall by about 250 basis points (from S&P's base case) on a low-double-digit revenue decline. S&P considers an upgrade unlikely because it believes the company's financial policies will remain aggressive under its private-equity owners. S&P assumes that the company may pursue additional targeted acquisitions or, eventually, a distribution of capital to shareholders. WESTERN ALLIANCE: Moody's Withdraws 'Ba3' Rating on Senior Debt --------------------------------------------------------------- Moody's Investors Service has withdrawn the ratings of Western Alliance Bancorporation (senior Ba3) and its bank subsidiary, Bank of Nevada (Ba1 and Not Prime for long-term and short-term deposits, respectively, Ba2 for other senior obligations and issuer ratings, D+/ba1 for standalone bank financial strength rating/baseline credit assessment). Prior to withdrawal, all ratings had a stable outlook. Moody's has withdrawn the rating for its own business reasons. XINERGY CORP: Moody's Withdraws 'Caa3' Ratings ---------------------------------------------- Moody's Investors Service has withdrawn the Caa3 Corporate Family Rating, the Caa3-PD Probability of Default Rating, and the Caa3 rating on senior secured notes for Xinergy Corp. (Xinergy). Moody's has withdrawn the rating for its own business reasons. * Moody's Notes Near-Flat 10-Year Growth for US State Debt ---------------------------------------------------------- Growth in outstanding debt issued by all US states slowed to 1.3% in calendar year 2012, says Moody's Investors Service in its annual update, "2013 State Debt Medians Report." The near-flat growth in debt was well below the 7% average annual growth of the past 10 years and the recent peak of 10% growth in 2009. The 1.3% growth in 2012 marked the third consecutive year the pace of growth in state debt had dropped. Moody's expects the growth in state debt to continue to be slow. Moody's state medians show Connecticut, Massachusetts, Hawaii, New Jersey and New York have the highest net tax-supported debt per capita. "Legal debt limitations, state-level austerity spending, and anti- debt sentiment have reduced states' appetite for new money borrowing," said Baye Larsen, a Moody's Vice President and Senior Analyst. "Additionally, debt plans have been influenced by uncertainty regarding federal fiscal policy and the impact of federal budget austerity on the national economy." States will continue to defer debt plans until the impact of federal budget balancing efforts are better understood, says Moody's. State debt service costs increased by 3% in 2012, much slower than the 8.6% growth experienced in 2011. In all, Moody's says the combined amount of net tax-supported debt for the 50 states increased to $516 billion in 2012 from $510 billion in 2011. The largest contributors to growth in net tax-supported debt in 2012 were California, Massachusetts, Virginia and Washington, with each adding between $1.2 billion and $1.7 billion in debt. Seven states saw notable declines in net tax-supported debt. On a dollar basis, the largest decreases were in Arizona, Florida, Illinois and New York. On a percentage basis, Kansas and Utah saw the largest declines, at 8% and 7% respectively. * 13 Defaults in First 4 Months of 2013, Says Fitch --------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, writes that according to a report from Fitch Ratings, the ravenous, risk- blind junk bond market may be recapitulating 2006 and 2007. In terms of defaults, the news is good for owners of junk debt. In the first four months of 2013, there were 13 defaults on $5.9 billion in bonds, about the same as the 14 defaults on $5.8 billion in the same period during 2012, Fitch said. Even though 66 percent of debt rated at CCC or lower has been trading above par, Fitch warned that the "default rate can remain deceptively low even as credit quality deteriorates." Looking at recent history, Fitch noted that the junk default rate remained below 1 percent in 2006 and 2007, perpetuating "the cycle of aggressive transactions and was in the end a red flag of systemic risk." The default rate for the last year now stands at 1.8 percent, compared with the 4.6 percent long-term average, Fitch said. Through April, the recovery rate on defaults was 77.1 percent. Subtracting distressed-debt exchanges, the recovery rate is 56.3 percent, according to Fitch. * Circuit Court Liberalizes Rules on Mutual Setoff -------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the U.S. Court of Appeals in Manhattan clarified rules governing situations when a contract claim may be offset against a tort claim. The appeals court reiterated law saying that a claim arises when all of the transactions necessary for liability have occurred, even if the claim remained contingent at bankruptcy. The case is Ogden v. Chorches (In re Bolin & Co. LLC), 12- 1310, U.S. Court of Appeals for Second Circuit (Manhattan). * Lien on Rent Must Have Separate Adequate Protection ----------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that when a lender has a mortgage on real property and a security interest in rents, the rents are entitled to their own "adequate protection" if the owner goes bankrupt. According to the report, a company reorganizing in Chapter 11 unsuccessfully sought bankruptcy court permission to use part of the rents to pay expenses of the case not associated with preserving the property. U.S. District Judge Marc T. Treadwell in Macon, Georgia, upheld the lower court. Judge Treadwell said he agreed with "most courts" that rent represents entirely different collateral entitled to its own adequate protection. Simply giving the lender a replacement lien on new rents isn't enough, he said. The report said the judge rejected the argument that only the lien on rents need be protected so long as the property isn't declining in value. The bankrupt, according to Judge Treadwell, could only use rents for expenses "directly related to the operation, maintenance or preservation" of the property that are "incurred primarily for the benefit for the secured creditor." The case is Putnal v. Suntrust Bank, 12-cv-00481, U.S. District Court, Middle District of Georgia (Macon). * Three Circuits Retain Absolute Priority Rule for Individuals -------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that three federal circuit courts of appeal have now ruled that Congress didn't repeal the absolute priority rule for individuals in Chapter 11 when amending the Bankruptcy Code in 2005. The latest member of the club is the U.S. Court of Appeals in New Orleans, thanks to an opinion on May 29 by Circuit Judge Edith H. Jones. Judge Jones found Section 1129(b)(2)(B) of the Bankruptcy Code not to be ambiguous. She said that the amendment in 2005 only allows an individual in Chapter 11 to retain income earned after filing, and thus not paying post-bankruptcy wages toward claims of pre-bankruptcy creditors. Previous circuit court decisions reaching the same result came in January from the Tenth Circuit in Denver and in June 2012 from the Fourth Circuit in Richmond, Virginia. The case is In Re Lively, 12-20277, U.S. Court of Appeals for the Fifth Circuit (New Orleans). * BOND PRICING: For Week From May 27 to May 31, 2013 ---------------------------------------------------- Maturity Issuer Name Ticker Coupon Bid Price Date ----------- ------ ------ --------- -------- ATP Oil & Gas Corp ATPG 11.875 1.500 5/1/2015 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 10.250 12.500 11/1/2015 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 15.000 32.250 4/1/2021 Alion Science & Technology Corp ALISCI 10.250 55.430 2/1/2015 AGY Holding Corp AGYH 11.000 56.000 11/15/2014 Murray Energy Corp MURREN 10.250 102.575 10/15/2015 USEC Inc USU 3.000 22.000 10/1/2014 RBS Capital Trust I RBS 4.709 81.875 Verso Paper Holdings LLC / Verso Paper Inc VRS 11.375 52.650 8/1/2016 Geokinetics Holdings USA Inc GEOK 9.750 52.750 12/15/2014 Eastman Kodak Co EK 7.000 19.000 4/1/2017 School Specialty Inc SCHS 3.750 23.000 11/30/2026 Cengage Learning Acquisitions Inc TLACQ 10.500 9.875 1/15/2015 Affinion Group Holdings Inc AFFINI 11.625 57.400 11/15/2015 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 10.250 12.750 11/1/2015 OnCure Holdings Inc ONCJ 11.750 45.000 5/15/2017 Cengage Learning Acquisitions Inc TLACQ 12.000 12.250 6/30/2019 GMX Resources Inc GMXR 9.000 17.000 3/2/2018 Savient Pharmaceuticals SVNT 4.750 15.000 2/1/2018 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 10.500 12.500 11/1/2016 Overseas Shipholding Group Inc OSG 8.750 82.250 12/1/2013 TMST Inc THMR 8.000 8.560 5/15/2013 GMX Resources Inc GMXR 4.500 4.000 5/1/2015 THQ Inc THQI 5.000 44.750 8/15/2014 Hawker Beechcraft Acquisition Co LLC / Hawker Beechcraft Notes Co HAWKER 8.500 6.000 4/1/2015 Dynegy Roseton LLC / Dynegy Danskammer LLC Pass Through Trust Series B DYN 7.670 4.500 11/8/2016 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 15.000 31.000 4/1/2021 PMI Group Inc/The PMI 6.000 28.000 9/15/2016 Eastman Kodak Co EK 9.200 21.063 6/1/2021 Las Vegas Monorail Co LASVMC 5.500 20.000 7/15/2019 Platinum Energy Solutions Inc PLATEN 14.250 43.750 3/1/2015 Mashantucket Western Pequot Tribe MASHTU 8.500 7.000 11/15/2015 AES Eastern Energy LP AES 9.000 1.750 1/2/2017 FiberTower Corp FTWR 9.000 6.375 1/1/2016 FairPoint Communications Inc/Old FRP 13.125 1.040 4/2/2018 Hawker Beechcraft Acquisition Co LLC / Hawker Beechcraft Notes Co HAWKER 8.875 2.000 4/1/2015 Penson Worldwide Inc PNSN 12.500 20.125 5/15/2017 Cengage Learning Holdco Inc TLACQ 13.750 7.250 7/15/2015 Residential Capital LLC RESCAP 6.875 30.500 6/30/2015 AES Eastern Energy LP AES 9.670 4.125 1/2/2029 Eastman Kodak Co EK 9.950 25.560 7/1/2018 HP Enterprise Services HPQ 3.875 96.900 7/15/2023 ATP Oil & Gas Corp ATPG 11.875 1.125 5/1/2015 Buffalo Thunder Development Authority BUFLO 9.375 28.750 12/15/2014 Downey Financial Corp DSL 6.500 64.000 7/1/2014 Motors Liquidation Co MTLQQ 7.200 1.250 1/15/2011 FairPoint Communications Inc/Old FRP 13.125 1.000 4/1/2018 LBI Media Inc LBIMED 8.500 30.000 8/1/2017 PMI Capital I PMI 8.309 0.625 2/1/2027 Horizon Lines Inc HRZL 6.000 30.480 4/15/2017 Cengage Learning Acquisitions Inc TLACQ 10.500 9.875 1/15/2015 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 10.250 12.500 11/1/2015 ATP Oil & Gas Corp ATPG 11.875 1.125 5/1/2015 Mashantucket Western Pequot Tribe MASHTU 8.500 7.000 11/15/2015 Motors Liquidation Co MTLQQ 6.750 1.250 5/1/2028 Motors Liquidation Co MTLQQ 7.375 1.250 5/23/2048 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 10.500 12.000 11/1/2016 Powerwave Technologies Inc PWAV 1.875 0.875 11/15/2024 Champion Enterprises Inc CHB 2.750 0.375 11/1/2037 Penson Worldwide Inc PNSN 12.500 20.125 5/15/2017 Texfi Industries TXFIE 8.750 1.000 8/1/1999 WCI Communities Inc/Old WCI 4.000 0.375 8/5/2023 Delta Air Lines 1993 Series A1 Pass Through Trust DAL 9.875 20.875 4/30/2049 Prudential Financial Inc PRU 3.980 99.500 6/10/2013 SLM Corp SLMA 0.775 97.506 6/15/2014 FairPoint Communications Inc/Old FRP 13.125 1.000 4/1/2018 Geokinetics Holdings USA Inc GEOK 9.750 51.750 12/15/2014 Terrestar Networks Inc TSTR 6.500 10.000 6/15/2014 WCI Communities Inc/Old WCI 6.625 0.500 3/15/2015 WCI Communities Inc/Old WCI 4.000 0.375 8/5/2023 Powerwave Technologies PWAV 1.875 0.875 11/15/2024 Lehman Brothers Holdings LEH 1.000 20.500 8/17/2014 Lehman Brothers Holdings LEH 1.000 20.500 8/17/2014 Lehman Brothers Holdings LEH 0.250 20.500 12/12/2013 Lehman Brothers Holdings LEH 0.250 20.500 1/26/2014 Lehman Brothers Holdings LEH 1.250 20.500 2/6/2014 Lehman Brothers Holdings LEH 1.000 20.500 3/29/2014 ********* 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., Washington, D.C., USA. Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Howard C. Tolentino, 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 2013. 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 $975 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 Peter A. Chapman at 215-945-7000 or Nina Novak at 202-241-8200. *** End of Transmission ***