/raid1/www/Hosts/bankrupt/TCR_Public/130613.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Thursday, June 13, 2013, Vol. 17, No. 162
Headlines
A123 SYSTEMS: Tannor Partners Buys Claims
AFA INVESTMENT: Cash Collateral Use Extended Until June 13
AHERN RENTALS: Tannor Partners Buys Claims
ALCO CORP: PR Asset Portfolio Buys Banco Popular Claim
ALLSTATE: Fitch Assigns 'BB+' Preferred Stock Rating
AMERICAN AIRLINES: Plan Confirmation Hearing Set for Aug. 15
AMERICAN AIRLINES: USAir Execs to Lead New Combined Airline
AMERICAN AIRLINES: Wants to Sell Condo Units in Coral Gables
AMERICAN CASINO: New First Lien Term Loan Gets Moody's B1 Rating
APPVION INC: S&P Assigns 'B+' Rating to $375MM 1st-Lien Term Loan
ARCAPITA BANK: Final Hearing on $175-Mil. GSI Financing on June 24
ARCAPITA BANK: Judge Confirms Chapter 11 Liquidation Plan
ATLANTIC COAST: Stockholders Reject Merger with Bond Street
BADGER HOLDING: S&P Assigns 'B+' CCR & Rates $560MM Notes 'B'
BANK OF NT BUTTERFIELD: Fitch Upgrades Viability Rating From 'bb+'
BEBO.COM INC: Bankruptcy Court Approves Bidding Procedures
BRIGHTSTAR CORP: S&P Affirms 'BB-' Rating to Sr. Unsecured Notes
CENTURY PLAZA: Plan Outline OK'd, July 18 Confirmation Hearing Set
CHARLES RIVER: Moody's Assigns Ba2 Rating to New $970MM Debt
CHARTER COMMUNICATIONS: Cash Tender Offer for Bresnan Securities
CODA HOLDINGS: Lio Energy and Miles Electric File for Chapter 11
DELTEK INC: Moody's Rates 1st Lien Debt B1 & 2nd Lien Debt Caa2
DOLE FOOD: S&P Puts 'B' CCR on CreditWatch Negative
DUNE ENERGY: Stockholders Elect Seven Directors to Board
DYNEGY HOLDINGS: 4 Units Given Thru June 15 to Consummate Plan
DYNEGY INC: Disbursing Agent Can File Claim Objections Til Oct. 14
EDISON MISSION: Patricia Chen Withdraws as Noteholders' Counsel
EXCEL MARITIME: Lenders Begin Voting on Prepackaged Plan
EXIDE TECHNOLOGIES: Wins Approval of First Day Motions
EXIDE TECHNOLOGIES: $500-Mil. DIP Financing Has Interim Approval
EXIDE TECHNOLOGIES: Wins Approval for GCG as Claims Agent
EXIDE TECHNOLOGIES: S&P Lowers CCR to 'D' Over Chapter 11 Filing
FEDERAL-MOGUL CORP: Moody's Rates New Secured Term Loan 'Ba3'
FENWICK AUTOMOTIVE: Motorcar Parts Units File for Chapter 7
FINJAN HOLDINGS: New Trading Symbol to Take Effect July 2
FLAT OUT: Hearing on Exclusivity Extension Adjourned to July 11
FNB UNITED: Closes Merger with Bank of Granite
FOOTHILL-EASTERN: S&P Assigns 'BB+' Rating to $207MM Revenue Bonds
FOREST OIL: S&P Revises Outlook to Negative & Affirms 'B+' CCR
FOTOLIA HOLDINGS: Moody's Assigns 'B2' Corp. Family Rating
FOTOLIA HOLDINGS: S&P Assigns Preliminary 'B' Corp. Credit Rating
FUNCTIONAL TECHNOLOGIES: Largest Creditor Wants Lift Stay
GORDIAN MEDICAL: Gets Extension of Ch. 11 Plan Deadline
HANDY HARDWARE: TRC Master Fund Buys Leaktite Claims
HERFF JONES: New $700MM Debt Facilities Get Moody's B2 Rating
HI-WAY EQUIPMENT: Gets Final OK to Incur Postpetition Financing
HOME LOAN: Moody's Assigns Ba3 Rating to New $350MM Term Loan
IN THE PLAY: Court Enters Order for Relief
INTERFAITH MEDICAL: Wants Further Extension of Plan Filing Date
INTROCAR INC: Motorcar Parts Units File for Chapter 7
JEFFERSON COUNTY: Sewer Bondholders Seek to Halt Appeal
JERRY'S NUGGET: Critical Hearing on June 26
JERRY'S NUGGET: Lever Capital Approved as Financing Broker
JERRY'S NUGGET: Fair Harbor Buys Tripp Plastics Claim
JOURNAL REGISTER: Seeks More Time to File Liquidation Plan
KIT DIGITAL: Creditors' Committee Objects to Disclosure Statement
KIT DIGITAL: Equity Committee Taps Brown Rudnick as Counsel
KIT DIGITAL: Creditors' Committee Retains Cooley LLP as Counsel
KIT DIGITAL: Seeks to Employ Bankruptcy Professionals
LAKE PLEASANT: Voluntary Chapter 11 Case Summary
LIFECARE HOLDINGS: Vibra Healthcare Completes Acquisition of CCHI
MARINAS INTERNATIONAL: Sails Into Chapter 11 Protection
MEDSOLUTIONS HOLDINGS: Moody's Assigns B2 CFR; Outlook Stable
MEDSOLUTIONS HOLDINGS: S&P Assigns 'B' Corp. Credit Rating
MOUNTAIN NATIONAL: Company Mulls Ch. 7 After Bank Seized
MW GROUP: Seeks Valuation of Bank of America's Collateral
NAMCO LLC: Has Final Approval of $16MM Salus DIP Financing
NATIONAL ENVELOPE: Receives Approval to Borrow $60-Mil.
NATIONAL ENVELOPE: Wins OK to Tap Epiq as Claims Agent
NAVISTAR INTERNATIONAL: Incurs $374MM Net Loss in 2nd Quarter
NNN 3500: Submits First Amended Chapter 11 Plan
ORCHARD SUPPLY: Receives Non-Compliance Notice From NASDAQ
ORCHARD SUPPLY: Fairholme No Longer Owns Class A Shares
PATRIOT COAL: Walked Out of Talks, Miners Union Says
PATRIOT COAL: Disputes UMWA Characterization of Negotiations
PHIL'S CAKE: Gets Approval to Continue Using Cash Collateral
POWERWAVE TECHNOLOGIES: Assets Sold; Now in Chapter 7 Liquidation
PROCTOR HOSPITAL: Moody's Downgrades Long-Term Bond Rating to B2
RAINMAKER SYSTEMS: NASDAQ to Delist Common Stock Today
READER'S DIGEST: Taps KPMG as Fresh Start Accountants
RESIDENTIAL CAPITAL: RFC Resolves Dispute with MortgageIT
RESIDENTIAL CAPITAL: NJ Carpenters' Class Suit Bid Adjourned
RESIDENTIAL CAPITAL: Denial of Papas Conversion Bid Upheld
RESIDENTIAL CAPITAL: Calif. Court Junks "Panaszewicz" Suit
RESIDENTIAL CAPITAL: N.C. Court Recommends "Wilson" Suit Dismissal
ROTECH HEALTHCARE: Equity Panel Objects to Disclosure Statement
ROTECH HEALTHCARE: Proposes to Employ Protiviti as Auditor
SANUWAVE HEALTH: Issues $300,000 Promissory Notes
SCHOOL SPECIALTY: Consummates Plan; Lenders Become New Owners
SCHOOL SPECIALTY: Bowery Buys Atradius' $2 Million Claim
SEA TRAIL: July 11 Hearing on Motion to Dismiss Chapter 11 Case
SEA TRAIL: Cienda Offers $6 Million for Resort Assets
SEANERGY MARITIME: Has Cut Indebtedness to $176.9 million
SERVICE CORP: S&P Assigns 'BB' Rating to $1.1BB Credit Facility
SINLAIR BROADCAST: Shareholders Elect Eight Directors
SUMMIT ENTERTAINMENT: S&P Withdraws 'B' CCR Following Repayment
SUPERIOR HOMES: Trustee Wins in Madoff Look-Alike Appeal
TRIAD GUARANTY: Court Enters Interim Order for Equity Transfers
TRINITY COAL: Arch Coal Wants Access to Kentucky Mine
UNI-PIXEL INC: Goldberg Capital Held 5.7% Equity Stake at June 11
UNIVISION COMMUNICATIONS: Fitch Affirms 'B' Issuer Default Rating
VAIL LAKE: Case Summary & 12 Unsecured Creditors
WATERSTONE AT PANAMA: May Use Cash Collateral Until July 15
WATERSTONE AT PANAMA: Garnishment in State Court Dissolved
WATERSTONE AT PANAMA: Gross & Welch Okayed as Bankruptcy Attorneys
WATERSTONE AT PANAMA: Withdraws Bid to Hire Burke Blue Hutchison
WIRECO WORLDGROUP: Weak Performance Cues Moody's to Cut CFR to B2
* Moody's Cites Lack of Protections for Bonds from US Retailers
* UST Issues New Guidelines for Legal Fees in Large Ch.11 Cases
* No Circuit Split on Dischargeability on Assigned Claims
* Safe-Harbor Defense Waived When Raised Two Years Into Suit
* Recent Small-Dollar & Individual Chapter 11 Filings
*********
A123 SYSTEMS: Tannor Partners Buys Claims
-----------------------------------------
Tannor Partners Credit Fund LP acquired TGEN Inc.'s $7,500 claim
filed in the Chapter 11 case of A123 Systems Inc., according to a
May 20 notice filed in Court.
Tannor Partners also acquired $8,249 claim filed by Hitools Inc.,
dba Hitex Development Tools in A123's case.
Tannor Partners may be reached at:
Robert J. Tannor
TANNOR PARTNERS CREDIT FUND LP
150 Grand Street, Suite 401
White Plains, NY 10601
Tel: 914-509-5000
Fax: (214) 299-8980
E-mail: management@tannorpartners.com
About A123 Systems
Based in Waltham, Massachusetts, A123 Systems Inc. designed,
developed, manufactured and sold advanced rechargeable lithium-ion
batteries and battery systems and provided research and
development services to government agencies and commercial
customers. A123 was the recipient of a $249 million federal grant
from the Obama administration.
A123 and U.S. affiliates, A123 Securities Corporation and Grid
Storage Holdings LLC, sought Chapter 11 bankruptcy protection
(Bankr. D. Del. Case Nos. 12-12859 to 12-12861) on Oct. 16, 2012.
A123 disclosed assets of $459.8 million and liabilities totaling
$376 million. Lawyers at Richards, Layton & Finger, P.A., and
Latham & Watkins LLP serve as the Debtors' counsel. Lazard Freres
& Co. LLC acts as the Debtors' financial advisors, while Alvarez &
Marsal serves as restructuring advisors. Logan & Company Inc.
serves as the Debtors' claims and noticing agent. Brown Rudnick
LLP and Saul Ewing LLP serve as counsel to the Official Committee
of Unsecured Creditors.
Prior to the bankruptcy filing, A123 had an agreement to sell an
80% stake in the business to Chinese auto-parts maker Wanxiang
Group Corp. U.S. lawmakers opposed the deal over concerns on the
transfer of American taxpayer dollars and technology to China.
When it filed for bankruptcy, the Debtors presented a deal to sell
all assets to Johnson Controls Inc., subject to higher and better
offers. At the auction in December 2012, most of the assets ended
up being sold for $256.6 million to Wanxiang. The deal received
approval from the Committee on Foreign Investment in the U.S. on
Jan. 29, 2013.
A123 Systems was renamed B456 Systems Inc., following the sale.
Wanxiang America Corporation and Wanxiang Clean Energy USA Corp.
are represented in the case by lawyers at Young Conaway Stargatt &
Taylor, LLP, and Sidley Austin LLP. JCI is represented in the
case by Josh Feltman, Esq., at Wachtell Lipton Rosen & Katz LLP.
In May 2013, the Delaware bankruptcy court confirmed the
liquidation plan for A123 Systems Inc. The Plan repays all
secured creditors in full with some money left over for unsecured
creditors. Holders of $143.8 million in subordinated notes are
projected to recoup 36.3 percent. If B456 Systems Inc., the
company's new name, reduces claims to amounts the company believes
correct, the recovery on the subordinated notes could increase to
62.9 percent, according to the disclosure statement. General
unsecured creditors, who previously were said to have $124 million
in claims, would have roughly the same recovery.
AFA INVESTMENT: Cash Collateral Use Extended Until June 13
----------------------------------------------------------
AFA Investment Inc., et al., and the agent for the second lien
lenders have agreed to a further extension of the termination date
under the Interim Cash Collateral Order through and including June
13, 2013.
Peter I Keane, Esq., 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, California; 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: Tannor Partners Buys Claims
------------------------------------------
White Plains, New York-based Tannor Partners Credit Fund LP
acquired Safelite Fulfillment Inc.'s $2,218 claim filed in the
Chapter 11 case of Ahern Rentals Inc., according to a May 20
notice filed in Nevada bankruptcy court. Safelite is based in
Cincinnati.
Tannor also bought the $3,368 claim filed by Dublin, Ohio-based
Recovery One LLC, and the $1,105 claim filed by Carson Valley
Heating Inc., a Gardnerville, Nevada firm.
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.
In June 2013, Ahern Rentals won approval in Nevada bankruptcy
court for its reorganization plan, which keeps the heavy-equipment
rental company in the hands of its founding family and pays
creditors in full, including bondholders who had previously sought
control through a rival plan.
ALCO CORP: PR Asset Portfolio Buys Banco Popular Claim
------------------------------------------------------
Banco Popular de Puerto Rico assigned its Claim No. 97 to PR Asset
Portfolio 2013-1 International, LLC, for an undisclosed amount,
according to a notice filed April 23 in Puerto Rico bankruptcy
court. Ubaldo M. Fernandez Barrera filed the notice on behalf of
PR Asset Portfolio 2013-1 International LLC.
About Alco Corp.
Alco Corporation in Dorado, Puerto Rico, filed for Chapter 11
bankruptcy (Bankr. D. P.R. Case No. 12-00139) on Jan. 12, 2012.
Carmen D. Conde Torres, Esq., and C. Conde & Associates represent
the Debtor in its restructuring effort. Alco tapped Jimenez
Vasquez & Associates, PSC, as accountants. The Debtor scheduled
$11.2 million in assets and $7.76 million in debts. The petition
was signed by Alfonso Rodriguez, president.
Bankruptcy Judge Mildred Caban Flores in Puerto Rico issued an
opinion and order on March 11, 2013, confirming the Amended
Chapter 11 Plan of Reorganization filed by Alco Corporation. The
Plan considers the full payment of all administrative, secured
creditors and priority claims and a 50% dividend to the general
unsecured creditors on monthly installments within 5 years from
the effective date.
ALLSTATE: Fitch Assigns 'BB+' Preferred Stock Rating
----------------------------------------------------
Fitch Ratings has assigned a 'BB+' rating to Allstate's issuance
of preferred stock.
KEY RATING DRIVERS
Allstate's recent issuance of $250 million of 5.625% fixed rate
perpetual non-cumulative preferred stock is part of an announced
plan to retire approximately $3 billion in outstanding senior debt
and subordinated notes funded by a combination of preferred stock,
debt and cash. The company has $1.2 billion in debt maturing in
2013 and 2014 which will be included in the capital plan.
Based on its rating criteria, Fitch has assigned 100% equity
credit to the preferred stock and has added an additional notch to
the rating to reflect more aggressive loss absorption features.
The security has no stated maturity. Dividends are non-cumulative,
and the company has the option to defer them at their discretion.
In addition, the security has a mandatory deferral feature that
requires deferral if certain capital ratios or operating results
are breached. Fitch believes the mandatory deferral could be
triggered before there is significant stress in the organization.
Therefore, it deems the features as having more aggressive loss
absorption.
Debt-to-total capital remained appropriate for the current rating
category at 27.3% at March 31, 2013, relative to Fitch's median
guideline of 28%. This ratio was calculated excluding unrealized
investment gains on fixed income securities from shareholders'
equity.
On June 7, 2013, Fitch affirmed all of Allstate's ratings with a
Stable Outlook.
RATING SENSITIVITIES
Key rating triggers for Allstate that could lead to an upgrade
include:
-- Growth in surplus leading to an improved capitalization
profile measured by operating leverage approaching 1.1x
and a score of 'Strong' or better on Fitch's proprietary
capital model, Prism;
-- Reduced volatility in earnings from catastrophe losses
and better operating results consistent with companies
in the 'AA' rating category;
-- Standalone ratings for Allstate's life subsidiaries could
increase if their consolidated statutory Risky Assets/TAC
ratio falls below 100% and they are able to sustain a GAAP
based Return on Assets ratio over 80 basis points.
Key rating triggers for Allstate that could lead to a downgrade
include:
-- A prolonged decline in underwriting profitability that is
inconsistent with industry averages or is driven by an
effort to grow market share during soft pricing conditions;
-- Substantial adverse reserve development that is inconsistent
with industry trends;
-- Significant deterioration in capital strength as measured by
Fitch's capital model, NAIC risk-based capital and traditional
operating leverage. Specifically, if operating leverage,
excluding the surplus of the life insurance operations,
approached 2.5x it would place downward pressure on ratings;
-- Significant increases in financial leverage ratio to greater
than 30%;
-- Unexpected and adverse surrender activity on liabilities in the
life insurance operations;
-- Liquid assets at the holding company less than one year's
interest expense and common dividends.
Fitch has assigned the following rating to Allstate:
-- 5.625% preferred stock 'BB+'.
AMERICAN AIRLINES: Plan Confirmation Hearing Set for Aug. 15
------------------------------------------------------------
Judge Sean Lane of the U.S. Bankruptcy Court for the Southern
District of New York signed off on an order approving the outline
of the restructuring plan proposed by AMR Corp. and its debtor
subsidiaries.
In his 17-page order on June 7, the bankruptcy judge approved the
disclosure statement explaining the proposed plan, which is hinged
on the company's $11 billion merger with US Airways Group Inc.
Under the merger, equity in the combined company will be split,
with 72% going to AMR's stakeholders and creditors and 28% to US
Airways. The plan is supported by AMR unsecured creditors holding
about $1.6 billion in claims.
Judge Lane also authorized AMR to begin soliciting votes, and set
the dates for AMR's creditors and other stakeholders to vote on
the plan. He set June 20 as the deadline for AMR to mail out
solicitation documents to stakeholders, with voting to be
completed by July 29.
The bankruptcy judge will hold a hearing on Aug. 15, at 10:00
a.m., to consider approval of the plan if it receives enough
support from those voting. Interested parties will have until
July 30 to file objections. A copy of Judge Lane's order can be
accessed for free at http://is.gd/U7elkU
AMR CEO Tom Horton called the judge's decision "a significant step
forward in our efforts to complete the most successful
restructuring in aviation history."
"We're in the home stretch of our restructuring and, thanks to the
hard work of our team, we are positioned to emerge a highly
competitive, leading global airline focused on delivering the very
best for our customers, our people, and our investors." Mr. Horton
said in a June 7 statement.
Prior to Judge Lane's decision, AMR further revised its disclosure
statement and restructuring plan. The revised plan incorporates a
settlement of issues related to the validity of guarantee claims
held by some creditors, and certain pre- bankruptcy intercompany
claims held by AMR, American Airlines Inc., and AMR Eagle Holding
Corp.
The plan also incorporates a settlement of issues related to
claims held by creditors tied to the marshaling of assets and
liabilities of the companies; potential avoidance actions based on
pre-bankruptcy transfers made, and obligations incurred, between
certain debtors; and the rights of holders of AMR equity interests
to payment under a plan.
Specifically, the Plan incorporates and reflects a compromise and
settlement of issues relating to (i) certain intercreditor issues
relating to the rights and benefits of holders of Double-Dip
General Unsecured Claims, Single-Dip General Unsecured Claims,
Triple-Dip General Unsecured Claims, and the DFW 1.5x Special
Facility Revenue Bond Claim, (ii) the validity, enforceability,
and priority of certain prepetition Intercompany Claims held by
and among AMR, American, and Eagle Holding, (iii) the validity and
enforceability of guarantee Claims held by certain creditors, (iv)
Claims that creditors have with respect to the marshaling of
assets and liabilities of AMR, American, or Eagle Holding in
determining relative entitlements to distributions under a plan,
(v) potential Avoidance Actions based on prepetition transfers
made, and obligations incurred, between certain Debtors, and (vi)
the rights of holders of AMR Equity Interests to a distribution
under a plan.
Full-text copies of the revised plan and disclosure statement are
available without charge at:
http://bankrupt.com/misc/AMR_2ndAmendedPlan060513.pdf
http://bankrupt.com/misc/AMR_2ndAmendedPlan060513.pdf
About American Airlines
AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements. AMR, previously the world's largest airline prior to
mergers by other airlines, is the last of the so-called U.S.
legacy airlines to seek court protection from creditors.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel. Rothschild
Inc., is the financial advisor. Garden City Group Inc. is the
claims and notice agent.
Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.
The Retiree Committee is represented by Jenner & Block LLP's
Catherine L. Steege, Esq., Charles B. Sklarsky, Esq., and Marc B.
Hankin, Esq.
AMR and US Airways Group, Inc., on Feb. 14, 2013, announced a
definitive merger agreement under which the companies will combine
to create a premier global carrier, which will have an implied
combined equity value of approximately $11 billion. The deal is
subject to clearance by U.S. and foreign regulators and by the
bankruptcy judge overseeing AMR's bankruptcy case.
In April 2013, AMR filed a Chapter 11 plan of reorganization that
will carry out the merger. By distributing stock in the merged
airlines, the plan is designed to pay all creditors in full, with
interest. The hearing before the Court to consider confirmation of
the Plan is scheduled for Aug. 15, 2013.
Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).
AMERICAN AIRLINES: USAir Execs to Lead New Combined Airline
-----------------------------------------------------------
US Airways Group Inc.'s executives will hold most of the top
leadership positions at the new combined company.
US Airways and AMR Corp. announced on June 10 the senior
leadership team that will run the new American Airlines once the
$11 billion merger closes.
Five of the top eight executives named to the new leadership team
will come from US Airways, including President Scott Kirby, chief
operating officer Robert Isom, and chief financial officer Derek
Kerr. Also coming from US Airways are Elise Eberwein, who will be
executive vice president for human resources and communications,
and Stephen Johnson, who will serve as executive vice president
for corporate affairs.
Meanwhile, Beverly Goulet, Maya Leibman and William Ris will join
the new company from American Airlines Inc., regional carrier of
AMR.
Miss Goulet will oversee the merger as chief integration officer
while Miss Leibman will oversee the technology systems as chief
information officer. Mr. Ris will serve as senior vice president
for government affairs.
US Airways CEO Doug Parker will run the new company while AMR CEO
Tom Horton will serve as board chairman through the first annual
meeting of shareholders.
"This announcement is another important step forward in creating
the new American Airlines and opening a new chapter for its more
than 100,000 team members," Mr. Parker said in a June 10
statement. "We are combining the strengths of legacy American and
US Airways and creating a collaborative industry-leading
leadership team."
Merged Airlines' New Board of Directors
The companies also announced the new board of directors of the
merged airline. Three of the 12 new directors will come from US
Airways, and two from American Airlines.
Besides Messrs. Parker and Horton, the board will include James
Albaugh, Jeffrey Benjamin, Michael Embler, Matthew Hart, Alberto
Ibarguen, Richard Kraemer, Denise O'Leary, Ray Robinson, Richard
Schifter, and John Cahill, the lead independent director and
former chairman of Kraft Foods Group Inc.
Separately, Dan Garton will step down as president and CEO of
American Eagle Airlines later this year. A successor will be
named prior to his departure.
About American Airlines
AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements. AMR, previously the world's largest airline prior to
mergers by other airlines, is the last of the so-called U.S.
legacy airlines to seek court protection from creditors.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel. Rothschild
Inc., is the financial advisor. Garden City Group Inc. is the
claims and notice agent.
Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.
The Retiree Committee is represented by Jenner & Block LLP's
Catherine L. Steege, Esq., Charles B. Sklarsky, Esq., and Marc B.
Hankin, Esq.
AMR and US Airways Group, Inc., on Feb. 14, 2013, announced a
definitive merger agreement under which the companies will combine
to create a premier global carrier, which will have an implied
combined equity value of approximately $11 billion. The deal is
subject to clearance by U.S. and foreign regulators and by the
bankruptcy judge overseeing AMR's bankruptcy case.
In April 2013, AMR filed a Chapter 11 plan of reorganization that
will carry out the merger. By distributing stock in the merged
airlines, the plan is designed to pay all creditors in full, with
interest. The hearing before the Court to consider confirmation of
the Plan is scheduled for Aug. 15, 2013.
Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).
AMERICAN AIRLINES: Wants to Sell Condo Units in Coral Gables
------------------------------------------------------------
AMR Corp. and its debtor affiliates asked the U.S. Bankruptcy
Court in Manhattan to approve the sale of condominium units owned
by American Airlines Inc.
AMR's regional carrier owns 16 units at 1600 Ponce Office
Condominium, a 13-storey condominium complex located in Coral
Gables, Florida.
One of the 16 office condo units is currently subject to a sales
contract, under which American Airlines agreed to sell the
property to Joan Fereira for $646,500. A copy of the agreement is
available for free at http://is.gd/fLhTGb
The airline plans to sell the other units on terms substantially
similar to those contained in the Fereira agreement, according to
a court filing.
AMR has tapped Allen Morris Co. to help the company market the
units. The firm has already received 11 offers from buyers since
it started marketing the properties in February 2012.
Allen Morris will receive 3% of the purchase price as commission
from the sale of a condo unit to Ms. Fereira.
The court will hold a hearing on June 27 to consider approval of
the proposed sale. Objections to the sale are due by June 20.
About American Airlines
AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements. AMR, previously the world's largest airline prior to
mergers by other airlines, is the last of the so-called U.S.
legacy airlines to seek court protection from creditors.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel. Rothschild
Inc., is the financial advisor. Garden City Group Inc. is the
claims and notice agent.
Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.
The Retiree Committee is represented by Jenner & Block LLP's
Catherine L. Steege, Esq., Charles B. Sklarsky, Esq., and Marc B.
Hankin, Esq.
AMR and US Airways Group, Inc., on Feb. 14, 2013, announced a
definitive merger agreement under which the companies will combine
to create a premier global carrier, which will have an implied
combined equity value of approximately $11 billion. The deal is
subject to clearance by U.S. and foreign regulators and by the
bankruptcy judge overseeing AMR's bankruptcy case.
In April 2013, AMR filed a Chapter 11 plan of reorganization that
will carry out the merger. By distributing stock in the merged
airlines, the plan is designed to pay all creditors in full, with
interest. The hearing before the Court to consider confirmation of
the Plan is scheduled for Aug. 15, 2013.
Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).
AMERICAN CASINO: New First Lien Term Loan Gets Moody's B1 Rating
----------------------------------------------------------------
Moody's Investors Service assigned a B1 rating to American Casino
& Entertainment Properties LLC's proposed $215 million guaranteed
senior secured 1st lien term loan due 2020 and $15 million
guaranteed 1st lien senior secured revolver due 2018.
Moody's also assigned a Caa2 to the company's proposed $120
million guaranteed senior secured 2nd lien term loan due 2021. In
addition, Moody's changed the outlook to developing from negative
and lowered the Speculative Grade Liquidity rating to SGL-4 from
SGL-3. The company's Corporate Family Rating is B3, the
Probability of Default rating is B3-PD and the senior secured
notes are rated B3.
Ratings Rationale:
Proceeds from the proposed $335 million guaranteed senior secured
term loans and cash on hand will be used to re-finance the
company's existing $375 million ($338 million outstanding) 11%
senior secured notes due June 15, 2014. Ratings are subject to
review of final documentation.
The change in outlook to developing from negative reflects Moody's
view that in the event ACEP successfully completes the re-
financing as proposed it could result in an affirmation of the B3
CFR with a stable outlook. However, an inability to execute the
transaction as outlined could result in a downgrade of the
existing ratings.
The downgrade of the Speculative Grade Liquidity rating to SGL-4
from SGL-3 reflects the near term maturity of ACEP's $375 million
($338 million outstanding) senior secured notes due on June 15,
2014, and the company's inability to fully fund this maturity from
internal sources of liquidity.
Although the successful completion of the proposed transaction as
currently planned is not expected to result in a higher rating, it
could result in an outlook revision to stable from developing if
the transaction closes as anticipated, as well as an upgrade of
the company's Speculative Grade Liquidity Rating to SGL-3 from
SGL-4. The proposed transaction is designed to lower ACEP's debt
cost of capital, materially extend its debt maturity profile, and
provide the company with a revolving credit facility, factors that
Moody's believes would materially improve ACEPs liquidity as well
as support a stable outlook.
Ratings assigned are:
$15 million guaranteed senior secured 1st lien revolver due 2018
at B1 (LGD 2, 28%)
$215 million guaranteed senior secured 1st lien term loan due 2020
at B1 (LGD 2, 28%)
$120 million guaranteed senior secured 2nd lien term loan due 2021
at Caa2 (LGD 5, 79%)
Ratings lowered are:
Speculative Grade Liquidity Ratings to SGL-4 from SGL-3
ACEP's B3 Corporate Family Rating reflects the company's small
size and high leverage. It also recognizes the company's
significant revenue concentration in and around the Las Vegas area
gaming markets. Positive rating consideration is given to Moody's
expectation that ACEP can generate sufficient earnings to support
interest, capital spending, and a modest amount of absolute debt
reduction.
ACEP's ratings could be downgraded if the company is not able to
refinance its existing debt capital structure in the very near-
term and/or it appears its earning or liquidity will deteriorate
for any reason. A higher rating would require that ACEP
demonstrate the ability and willingness to achieve and maintain
debt/EBITDA below 3.5 times and EBIT/interest of around 1.5 times.
A higher rating would also require an improved liquidity profile.
The principal methodology used in this rating was the Global
Gaming Industry Methodology published in December 2009. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
American Casino & Entertainment Properties, LLC owns and operates
3 gaming properties in Las Vegas, NV -- the Stratosphere on the
Las Vegas Strip, Arizona Charlie's Decatur and Arizona Charlie's
Boulder in the Las Vegas locals market -- and one property in
Laughlin, NV (Aquarius). Annual revenue is approximately $340
million.
APPVION INC: S&P Assigns 'B+' Rating to $375MM 1st-Lien Term Loan
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' issue-level
rating and '2' recovery rating to Wisconsin-based Appvion Inc.'s
proposed $375 million first-lien term loan due 2019. S&P also
assigned its 'CCC+' issue-level rating and '6' recovery rating to
the proposed $200 million second-lien term loan due 2020. In
addition, S&P revised the outlook on the 'B' corporate credit
rating to positive from stable and affirmed the rating.
"We revised our outlook to positive to reflect our view that cost
savings in the coated paper segments and gradual growth in the
encapsulation segment will drive higher EBITDA margins,
potentially dropping leverage to less than 5x EBITDA over the next
12 months. The outlook revision also reflects our view that the
proposed refinancing transactions alleviate near-term refinancing
risk and provide a more flexible capital structure that allows
ongoing debt repayment from free cash flow," said Standard &
Poor's credit analyst James Fielding.
The positive outlook acknowledges S&P's view that gross margins
and EBITDA margins will benefit from cost savings related to the
2012 closure of an unprofitable paper plant and the outsourcing of
Appvion's paper supply in 2013. S&P also expects gradual growth
in the higher margin encapsulation segment to benefit Appvion's
bottom line over time.
S&P would upgrade Appvion within the next 12 months if it appeared
likely that leverage would drop and remain less than 5x EBITDA.
This could occur if gross margins improved by 300 basis points and
EBITDA climbed to more than $140 million, as currently
contemplated in S&P's baseline scenario for 2014. This could also
occur if the company allocated some free cash flow to prepay some
new term debt.
S&P would revise its rating outlook on Appvion to stable if gross
margins did not improve, as expected, and leverage remained more
than 5x. This could occur if the cost of raw materials, primarily
paper stock and chemicals, increased more than S&P currently
expects. S&P would also revise the outlook to stable if the
proposed refinancing transactions did not occur as currently
outlined.
ARCAPITA BANK: Final Hearing on $175-Mil. GSI Financing on June 24
------------------------------------------------------------------
The final hearing on Arcapita Bank B.S.C.(c), et al.'s motion for
entry of a final order authorizing the Debtors to obtain
replacement postpetition financing of up to $175 million from
Goldman Sachs International to repay existing postpetition
financing will be held on June 24, 2013, at 2:00 p.m.
Objections to the Motion will be filed electronically with the
Court on the docket of Arcapita Bank by registered users of the
Court's case filing system and by all other parties-in-interest so
as to be received no later than June 17, 2013, at 4:00 p.m.
Replies to any Objections will be filed so as to be received no
later than June 20, 2013 at 4:00 p.m.
About Arcapita Bank
Arcapita Bank B.S.C., also known as First Islamic Investment Bank
B.S.C., along with affiliates, filed for Chapter 11 protection
(Bankr. S.D.N.Y. Lead Case No. 12-11076) in Manhattan on March 19,
2012. The Debtors said they do not have the liquidity necessary
to repay a US$1.1 billion syndicated unsecured facility when it
comes due on March 28, 2012.
Falcon Gas Storage Company, Inc., filed a Chapter 11 petition
(Bankr. S.D.N.Y. Case No. 12-11790) on April 30, 2012. Falcon Gas
is an indirect wholly owned subsidiary of Arcapita that previously
owned the natural gas storage business NorTex Gas Storage Company
LLC. In early 2010, Alinda Natural Gas Storage I, L.P. (n/k/a
Tide Natural Gas Storage I, L.P.), Alinda Natural Gas Storage II,
L.P. (n/k/a Tide Natural Gas Storage II, L.P.) acquired the stock
of NorTex from Falcon Gas for $515 million. Arcapita guaranteed
certain of Falcon Gas' obligations under the NorTex Purchase
Agreement.
The Debtors tapped Gibson, Dunn & Crutcher LLP as bankruptcy
counsel, Linklaters LLP as corporate counsel, Towers & Hamlins LLP
as international counsel on Bahrain matters, Hatim S Zu'bi &
Partners as Bahrain counsel, KPMG LLP as accountants, Rothschild
Inc. and financial advisor, and GCG Inc. as notice and claims
agent.
Milbank, Tweed, Hadley & McCloy LLP represents the Official
Committee of Unsecured Creditors. Houlihan Lokey Capital, Inc.,
serves as its financial advisor and investment banker.
Founded in 1996, Arcapita is a global manager of Shari'ah-
compliant alternative investments and operates as an investment
bank. Arcapita is not a domestic bank licensed in the United
States. Arcapita is headquartered in Bahrain and is regulated
under an Islamic wholesale banking license issued by the Central
Bank of Bahrain. The Arcapita Group employs 268 people and has
offices in Atlanta, London, Hong Kong and Singapore in addition to
its Bahrain headquarters. The Arcapita Group's principal
activities include investing on its own account and providing
investment opportunities to third-party investors in conformity
with Islamic Shari'ah rules and principles.
The Arcapita Group had roughly US$7 billion in assets under
management. On a consolidated basis, the Arcapita Group owns
assets valued at roughly US$3.06 billion and has liabilities of
roughly US$2.55 billion. The Debtors owe US$96.7 million under
two secured facilities made available by Standard Chartered Bank.
Arcapita explored out-of-court restructuring scenarios but was
unable to achieve 100% lender consent required to effectuate the
terms of an out-of-court restructuring.
Subsequent to the Chapter 11 filing, Arcapita Investment Holdings
Limited, a wholly owned Debtor subsidiary of Arcapita in the
Cayman Islands, issued a summons seeking ancillary relief from the
Grand Court of the Cayman Islands with a view to facilitating the
Chapter 11 cases. AIHL sought the appointment of Zolfo Cooper as
provisional liquidator.
On Feb. 8, 2013, the Debtors filed with the Bankruptcy Court a
disclosure statement in support of their Joint Plan of
Reorganization, dated Feb. 8, 2013. The Plan contemplates, among
others, the entry of the Debtors into a $185 million Murabaha exit
facility that will allow the Debtors to wind down their businesses
and assets for the benefit of all creditors and stakeholders.
On April 25, 2013, the Debtors filed their Second Amended Joint
Plan of Reorganization. On April 26, 2013, the Court approved the
related disclosure statement.
A copy of the Second Amended Disclosure Statement is
available at: http://bankrupt.com/misc/arcapta.doc1038.pdf
ARCAPITA BANK: Judge Confirms Chapter 11 Liquidation Plan
---------------------------------------------------------
Joseph Checkler writing for Dow Jones' DBR Small Cap reports that
a U.S. judge Tuesday confirmed Arcapita Bank BSC's plan to
gradually liquidate itself, a proposal with broad support among
the Bahrain investment firm's creditors and shareholders.
Arcapita Bank filed with the U.S. Bankruptcy Court for the
Southern District of New York Monday a Second Amended Chapter 11
Joint Plan of Reorganization (With First Technical Modifications).
Among other Technical Modifications, the Modified Second Amended
Plan states that the SCB Claims shall be treated as set forth in
the SCB Plan Settlement and that Confirmation of the Plan shall
constitute approval of the SCB Plan Settlement, dated as of
June 6, 2013, and shall bind the parties thereto to the terms
thereof.
A copy of the Modified Second Amended Plan is available at:
http://bankrupt.com/misc/arcapita.doc1251.pdf
About Arcapita Bank
Arcapita Bank B.S.C., also known as First Islamic Investment Bank
B.S.C., along with affiliates, filed for Chapter 11 protection
(Bankr. S.D.N.Y. Lead Case No. 12-11076) in Manhattan on March 19,
2012. The Debtors said they do not have the liquidity necessary
to repay a US$1.1 billion syndicated unsecured facility when it
comes due on March 28, 2012.
Falcon Gas Storage Company, Inc., filed a Chapter 11 petition
(Bankr. S.D.N.Y. Case No. 12-11790) on April 30, 2012. Falcon Gas
is an indirect wholly owned subsidiary of Arcapita that previously
owned the natural gas storage business NorTex Gas Storage Company
LLC. In early 2010, Alinda Natural Gas Storage I, L.P. (n/k/a
Tide Natural Gas Storage I, L.P.), Alinda Natural Gas Storage II,
L.P. (n/k/a Tide Natural Gas Storage II, L.P.) acquired the stock
of NorTex from Falcon Gas for $515 million. Arcapita guaranteed
certain of Falcon Gas' obligations under the NorTex Purchase
Agreement.
The Debtors tapped Gibson, Dunn & Crutcher LLP as bankruptcy
counsel, Linklaters LLP as corporate counsel, Towers & Hamlins LLP
as international counsel on Bahrain matters, Hatim S Zu'bi &
Partners as Bahrain counsel, KPMG LLP as accountants, Rothschild
Inc. and financial advisor, and GCG Inc. as notice and claims
agent.
Milbank, Tweed, Hadley & McCloy LLP represents the Official
Committee of Unsecured Creditors. Houlihan Lokey Capital, Inc.,
serves as its financial advisor and investment banker.
Founded in 1996, Arcapita is a global manager of Shari'ah-
compliant alternative investments and operates as an investment
bank. Arcapita is not a domestic bank licensed in the United
States. Arcapita is headquartered in Bahrain and is regulated
under an Islamic wholesale banking license issued by the Central
Bank of Bahrain. The Arcapita Group employs 268 people and has
offices in Atlanta, London, Hong Kong and Singapore in addition to
its Bahrain headquarters. The Arcapita Group's principal
activities include investing on its own account and providing
investment opportunities to third-party investors in conformity
with Islamic Shari'ah rules and principles.
The Arcapita Group had roughly US$7 billion in assets under
management. On a consolidated basis, the Arcapita Group owns
assets valued at roughly US$3.06 billion and has liabilities of
roughly US$2.55 billion. The Debtors owe US$96.7 million under
two secured facilities made available by Standard Chartered Bank.
Arcapita explored out-of-court restructuring scenarios but was
unable to achieve 100% lender consent required to effectuate the
terms of an out-of-court restructuring.
Subsequent to the Chapter 11 filing, Arcapita Investment Holdings
Limited, a wholly owned Debtor subsidiary of Arcapita in the
Cayman Islands, issued a summons seeking ancillary relief from the
Grand Court of the Cayman Islands with a view to facilitating the
Chapter 11 cases. AIHL sought the appointment of Zolfo Cooper as
provisional liquidator.
On Feb. 8, 2013, the Debtors filed with the Bankruptcy Court a
disclosure statement in support of their Joint Plan of
Reorganization, dated Feb. 8, 2013. The Plan contemplates, among
others, the entry of the Debtors into a $185 million Murabaha exit
facility that will allow the Debtors to wind down their businesses
and assets for the benefit of all creditors and stakeholders.
On April 25, 2013, the Debtors filed their Second Amended Joint
Plan of Reorganization. On April 26, 2013, the Court approved the
related disclosure statement.
A copy of the Second Amended Disclosure Statement is
available at: http://bankrupt.com/misc/arcapta.doc1038.pdf
ATLANTIC COAST: Stockholders Reject Merger with Bond Street
-----------------------------------------------------------
Atlantic Coast Financial Corporation, the holding company for
Atlantic Coast Bank, said that the proposed merger with Bond
Street Holdings, Inc., did not receive stockholder approval at the
special meeting of stockholders held on June 11. Likewise, a
proposal that would have approved an adjournment of the meeting to
allow for the solicitation of additional votes failed to receive
stockholder approval.
The Company's Board of Directors had recommended the proposed
merger with Bond Street because the Board concluded it represented
the best alternative for all stockholders in addressing the
demands that currently face the Company, including the Bank's
ability to meet the capital requirements of the regulatory consent
order under which it currently operates. However, the Board
respects the decision of stockholders and, accordingly, it will
begin to evaluate other strategic alternatives immediately,
including a possible recapitalization, as the Board continues to
carry out its normal corporate governance responsibilities.
Moreover, the stockholders did not approve the compensation to be
paid to the named executive officers of the Company in connection
with the merger that will be implemented if the Merger Agreement
is consummated.
About Atlantic Coast
Jacksonville, Florida-based Atlantic Coast Financial Corporation
is the holding company for Atlantic Coast Bank, a federally
chartered and insured stock savings bank. It is a community-
oriented financial institution serving northeastern Florida and
southeastern Georgia markets through 12 locations, with a focus on
the Jacksonville metropolitan area.
The Company reported a net loss of $6.66 million on $33.50 million
of total interest and dividend income for the year ended Dec. 31,
2012, as compared with a net loss of $10.28 million on $38.28
million of total interest and dividend income in 2011.
The Company's balance sheet at March 31, 2013, showed $747.57
million in total assets, $710.23 million in total liabilities and
$37.34 million in total stockholders' equity.
McGladrey LLP, in Jacksonville, Florida, 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 that have
adversely impacted capital at Atlantic Coast Bank. The failure to
comply with the regulatory consent order may result in Atlantic
Coast Bank being deemed undercapitalized for purposes of the
consent order and additional corrective actions being imposed that
could adversely impact the Company's operations. This raises
substantial doubt about the Company's ability to continue as a
going concern.
BADGER HOLDING: S&P Assigns 'B+' CCR & Rates $560MM Notes 'B'
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' corporate
credit rating to Badger Holding LLC (Safway). The outlook is
negative. At the same time, S&P also assigned its 'B' issue
rating and '5' recovery rating (indicating S&P's expectation of
modest [10%-30%] recovery in the event of payment default) to
Safway Group Holding LLC's $560 million senior secured second-lien
notes. Safway Finance Corp. is a non-operating entity and co-
issuer of the notes.
The ratings on Safway reflect S&P's view of the company's
"aggressive" financial profile and "weak" business profile. S&P's
financial risk assessment reflects leverage expectations of about
4.5x-5.0x (including S&P's adjustments, mainly for operating
leases) in 2013 and 2014, with modest free cash flow generation
prospects over the next two years following its refinancing.
Private equity firm Odyssey Investment Partners owns Safway, and
S&P believes the financial policy will remain aggressive. The
business risk assessment reflects the company's high exposure to
cyclical industrial and commercial end markets amid competitive
pricing.
The company provides labor to erect and dismantle the scaffolding
that it rents and sells mostly through its industrial segment
(including refining, petrochemicals, and power generation
industries in the U.S. and in the Canadian oil sands markets) and,
to a lesser extent, through general contractors in its commercial
segment. Although these end markets are cyclical, maintenance
services (roughly 80% of overall revenues) tend to be more
resilient to recessionary cycles. After being deferred during the
economic downturn, maintenance and plant turnaround activity is
slowly picking up across the company's industrial end markets,
especially refining.
The negative outlook reflects at least a one-in-three chance of a
downgrade given the potential for aggressive financial policies,
which could heighten the risk of increasing leverage of the
sponsor-owned company above 5.0x over the next 12 months (though
this is not S&P's current base case).
"We could lower the rating if we believe fully adjusted debt to
EBITDA were likely to exceed 5x on a sustained basis," said
Standard & Poor's credit analyst Nishit Madlani. "Alternatively,
we could revise the outlook to stable if it appeared more likely
that a disciplined financial policy would lead to sustained
leverage of 4.0x-5.0x."
BANK OF NT BUTTERFIELD: Fitch Upgrades Viability Rating From 'bb+'
------------------------------------------------------------------
Fitch Ratings has affirmed Bank of N.T. Butterfield & Son
Limited's (BNTB) long-term Issuer Default Rating (IDR) at 'A-'.
The Rating Outlook remains Stable. In addition, Fitch has upgraded
the banks' Viability Rating (VR) to 'bbb-' from 'bb+' and removed
it from Rating Watch Positive.
BNTB's ratings and Outlook are unaffected by the recent downgrade
of Bermuda's foreign currency long-term IDR to 'AA-' from 'AA'
(for additional details, see 'Fitch Downgrades Bermuda's IDR to
'AA-'; Outlook Negative' dated June 7, 2013).
RATING DRIVERS AND SENSITIVITIES - VRs and SUBORDINATED DEBT
The upgrade of BNTB's VR reflects its strong market position,
liquid balance sheet, good capital levels, and diversified revenue
stream (with fee based revenues representing almost 40% of total
revenues), offset by significant product concentration in
residential lending, geographic concentration in Bermuda and large
exposures in its commercial loan portfolio.
Although BNTB continues to face asset quality pressures,
specifically in its residential loan portfolio, Fitch expects net
losses to remain manageable. Despite BNTB's non-performing assets
(NPAs; inclusive of accruing troubled debt restructurings and
foreclosed real estate) remain high at 4.05% as of March 31, 2013,
average 5Q NCOs remain extremely low at 26 basis points (bps).
Further upward movement on the VR is considered unlikely unless
the company experiences a significant increase in core
profitability and materially reduces its non-performing loans,
while continuing to maintain high levels of capital. Conversely, a
downgrade of the VR could occur in the event of significant
deterioration of financial performance, a rise in NCOs due to
asset quality pressures, and an increase to the risk level of the
balance sheet mix.
Subordinated debt issued by BNTB is notched down from the VR, and
the rating of specific issues is typically sensitive to any change
in the bank's VR. In conjunction with the upgrade of the VR, Fitch
has upgraded BNTB's subordinated debt to 'BB+' from 'BB'.
RATING DRIVERS AND SENSITIVITIES - IDR AND OTHER HYBRID SECURITIES
The affirmation of BNTB's IDR reflects BNTB's Support Rating Floor
(SRF) of 'A-' due to its systemic importance to the local economy,
as well as demonstrated support from the Bermudian government
given its guarantee on the principal and interest payments of
BNTB's outstanding preferred stock. Additionally, Bermuda also
owns an equity stake in BNTB through a sovereign pension fund.
Given these factors, Fitch considers support from the Bermuda
government to be extremely high.
Although Fitch's view includes a strong probability of support in
determining BNTB's IDRs, these ratings could be adversely affected
if the willingness and/or capacity of the Bermudian government to
support BNTB in the event of need were to change. Fitch's IDRs on
Bermuda are a reflection of the government's ability to support
BNTB.
Despite its Negative Outlook on the Bermuda sovereign, Fitch's
Outlook on BNTB's IDR remains Stable on the basis that even if the
sovereign's ratings were downgraded by another notch, Fitch could
maintain the SRF at its current level. This is based on Fitch's
belief that the government's propensity and ability to support
BNTB, if necessary, would remain intact.
Fitch would assess the government's ability to support BNTB and
potentially revise the SRF if the sovereign's rating were
downgraded by more than one notch.
Preferred stock issued by BNTB is equalized with Bermuda's foreign
currency long-term IDR, reflecting the guarantee from the Bermuda
Government. Fitch has downgraded the preferred stock issuance to
'AA-' from 'AA' following the sovereign ratings downgrade.
BNTB's preferred stock rating is highly sensitive to any changes
in the ability of the Bermuda government to fulfill its
obligation.
RATING DRIVERS AND SENSITIVITIES - SUPPORT RATING AND SUPPORT
RATING FLOOR
Fitch considers BNTB to be a systemically important institution to
the local Bermuda economy and as such considers the level of
support from the government to be extremely high. This support was
demonstrated by the governments guarantee on the principal and
interest payments of BNTB's outstanding preferred stock. Based on
the high support level, Fitch affirms the bank's SRF at 'A-'.
Fitch has taken the following rating actions:
Bank of N.T. Butterfield & Son
-- Long-term IDR affirmed at 'A-'; Outlook Stable
-- Short-term IDR affirmed at 'F1';
-- Viability Rating upgraded to 'bbb-' from 'bb+';
-- Preferred stock downgraded to 'AA-' from 'AA';
-- Subordinated debt upgraded to 'BB+' from 'BB';
-- Support rating affirmed at '1';
-- Support Floor affirmed at 'A-'.
BEBO.COM INC: Bankruptcy Court Approves Bidding Procedures
----------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California,
Los Angeles Division has approved bidding procedures for the sale
of substantially all of the business assets of bebo.com.
All bids must be submitted to
William F. Govier
LESNICK PRINCE AND PAPPAS LLP
315 W. 9th Street Los Angeles, CA. 90015.
Fax: 310.396.0963
E-mail: wgovier@lesnickprince.com
Bids must be received no later than June 27, 2013. Bids from
parties that are not Qualified Bidders may be discarded. For a
complete listing of bid timelines and requirements please go to:
http://www.burkecapital.net/bebo
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Bebo.com Inc. will be sold at auction on July 1,
assuming there is a buyer willing to pay at least $50,000 for the
business assets. The lawsuits the company could file will be
auctioned separately, also with a $50,000 minimum bid.
The report notes that the bankruptcy was initiated by the
company's receiver, who was appointed in state court in March at
the behest of minority shareholders, including founder Michael
Birch. Before bankruptcy, MXB Holdings Inc. expressed interest in
buying both packages of assets at the minimum prices, according to
a court filing.
The hearing to approve the sale is slated July 1, immediately
after the auction.
About Bebo.com
Bebo.com Inc. sought Chapter 11 protection (Bankr. C.D. Cal. Case
No. 13-22205) in Los Angeles on May 9, 2013. William F. Govier,
Esq., and Matthew A. Lesnick, Esq., at Lesnick Prince & Pappas,
LLP, in Santa Monica, California, serve as counsel.
Founded in 2005, bebo.com, a San Francisco based company, is one
of the world's innovators of social media channels. Its social
media applications are considered benchmarks for some of today's
top social media services.
The official schedules show assets of $27,000 and debt totaling
$1.76 million, including $213,000 in secured claims and $695,000
in priority claims.
The state court receiver is Michael Ong -- MOng@BurkeCapital.net -
- from Burke Capital Corp.
BRIGHTSTAR CORP: S&P Affirms 'BB-' Rating to Sr. Unsecured Notes
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB-' corporate
credit rating on Miami-based Brightstar Corp. and revised the
outlook to negative from stable.
In addition, S&P affirmed its 'BB-' issue-level rating on the
company's senior unsecured notes. The recovery rating on this
debt remains unchanged at '4', indicating S&P's expectation of
average (30% to 50%) recovery for lenders in the event of default.
The outlook revision is based on the increased debt as a result of
additional working capital requirements to support Brightstar's
business growth. However, S&P also expects that currently
elevated leverage will decline to the mid-4x area by year-end
2013.
"The ratings on Brightstar reflect our assessment of the company's
'weak' business risk profile and 'aggressive' financial risk
profile," said Standard & Poor's credit analyst Katarzyna Nolan.
S&P's business risk assessment reflects Brightstar's highly
competitive and fragmented global distribution market, low
distributor-like operating margins, narrow end-market focus, and
its complex operations across multiple geographies.
The company's expanding portfolio of services for the wireless
industry, improving year-over-year EBITDA margins, broad market
reach, and strong secular wireless device growth trends provide
support to S&P's business evaluation.
Brightstar's revenue for the last 12 months ended March 31, 2013
was approximately $6.6 billion, an increase of about 18% over the
prior-year period. The growth reflected continued penetration in
existing markets, new retail contracts, increased revenue from
device buy-backs and trade-ins, handset insurance, and from device
activation and e-commerce solutions. S&P expects Brightstar's
revenues to grow in the midteens percent area in 2013,
incorporating increasing global wireless penetration, frequent OEM
product launches, and the company's new business wins with Best
Buy and Target.
Further, S&P expects the company's current mid-3% EBITDA margins
to improve to the 4% area by the end of 2014 through a revenue mix
shift to higher margin services and solutions.
The negative outlook reflects S&P's expectation that leverage will
decline to the mid-4x area by year-end 2013, and that EBITDA
growth will contribute to improved financial metrics over the
following several quarters. If Brightstar's leverage decreases to
the 4x area, S&P would revise the outlook to stable.
S&P could lower the rating if Brightstar's expected leverage
remains at or above 4.5x in 2014, either because of increased
working-capital-related borrowing, debt-financed dividend
payments, or a failure to generate EBITDA growth, due to
escalating margin pressure.
CENTURY PLAZA: Plan Outline OK'd, July 18 Confirmation Hearing Set
------------------------------------------------------------------
Judge J. Philip Klingeberger approved in all respects the amended
disclosure statement describing the amended Chapter 11 Plan of
Century Plaza LLC on June 4, 2013.
The U.S. Bankruptcy Court for the Northern District of Indiana
held that the Disclosure Statement contains "adequate information"
as defined under Sec. 1125 of the U.S. Bankruptcy Code.
With this development, the Debtor can go forward with distributing
copies of the Plan and soliciting acceptances for it. Creditors
eligible to vote on the Plan are given until June 17, 2013, to
file their written ballots on the Plan.
Voting Deadline and Confirmation Hearing
Judge Klingeberger has further set July 18, 2013, at 10:30 a.m.,
for the hearing on confirmation of the Plan to be held at 5400
Federal Plaza, Courtroom No. 8, Hammond, Indiana, 46320.
Interested parties have until July 10 to serve any written
objections to confirmation of the Plan.
In the event any timely objection to Plan confirmation is filed,
the Court in its discretion may convert the confirmation hearing
on the Debtor's Plan to a pre-hearing conference pursuant to Fed.
R. Bankr. P. 7016.
Moreover, the Court may required the Debtor to file an itemized
report as to all unpaid, postpetition, priority, requests for the
payment of administrative expenses that have been filed pursuant
to Sec. 503(b), and which are entitled to priority pursuant to
Sec. 507(a)(1). The Court may even require a confirmation deposit
pursuant to Fed. R. Bankr. P. 3020.
Amended Plan Filed
The Debtor filed its First Amended Disclosure Statement shortly
before the June 3 hearing on the matter, with non-material
modifications, a free copy of which is available for free at
http://bankrupt.com/misc/CENTURYPLAZA_1stAmdDSJune3.pdf
As reported by The Troubled Company Reporter on May 6, 2013, the
Plan provides that on the Effective Date, the Debtor will remit to
its mortgage lender, Inland Century Plaza, LLC, all of its Cash on
the Effective Date, less (a) the amount of the Debtor's allowed
and unpaid administrative claims in an amount not to exceed
$200,000 and Class 3 Unsecured Claims in the amount of $84,143.78;
(b) an amount equal to $100,000 which will serve as working
capital ("Working Capital Reserve") cushion by the Debtor; and (c)
the amount of unpaid real estate taxes due and owing on the
Shopping Center which will be paid to the County Treasurer.
Allowed Tenant Claims in Class 2 will be paid in full in cash as
required by the underlying lease between the Debtor and the Class
2 Claim holder.
Unsecured Creditors exclusive of Insider Claims in Class 3, owed
approximately $84,143.78, will be paid 100% of their Claims in
cash on the Effective Date or as soon as practicable thereafter
from available existing cash resources of the Debtor.
Insider Claims in Class 4 are voluntarily subordinated to the
Allowed Class 1 Claim, will not share in any distributions of
Allowed Unsecured Claims and will receive no distributions under
the Plan unless and until the Allowed Class 1 Claim is paid in
full or Inland agrees otherwise, whichever occurs sooner.
The Member of the Debtor (Class 5 Interests) will retain its
Interests in the Debtor after Confirmation of the Plan. No
distributions will be made to the Member on account of its
interests in the Debtor unless and until the payments to Inland
under the Plan have been completed or until Inland agrees
otherwise, whichever occurs sooner.
David K. Welch, Esq., of Crane, Heyman, Simon, Welch & Clar, in
Chicago, Illinois, appeared at the Disclosure Statement hearing on
the Debtor's behalf. Geoffrey S. Goodman, Esq., appeared at the
hearing on behalf of Inland Century Plaza, LLC.
Arthur G. Simon, Esq., and Jeffrey C. Dan, Esq., of Crane, Heyman,
Simon, Welch & Clar, in Chicago, Illinois, also represent the
Debtor. Richard E. Anderson, Esq. and Michael E. Anderson, Esq.,
of Anderson & Anderson, P.C., in Merville, Indiana, serve as the
Debtor's local counsel.
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.
CHARLES RIVER: Moody's Assigns Ba2 Rating to New $970MM Debt
------------------------------------------------------------
oody's Investors Service assigned a Ba2 rating to the amended
senior secured credit facility of Charles River Laboratories
International Inc. These include the upsized $550 million revolver
and the $420 million term loan that includes a $150 million
delayed draw commitment. The amendment to the credit facility
provides the company with additional financing to repay $350
million in convertible notes that mature on June 15, 2013. It also
extends maturities of the senior secured debt and provides the
company with slightly more favorable pricing.
Concurrently, Moody's affirmed Charles River's Corporate Family
Rating of Ba2 and the Probability of Default Rating of Ba2-PD.
Moody's also upgraded the Speculative Grade Liquidity Rating to
SGL-1 (signifying very good liquidity) from SGL-3 (adequate
liquidity) due to the additional revolver and delayed draw
capacity and increased covenant cushion provided by the amendment.
The rating outlook remains stable.
Moody's assigned the following ratings to the amended credit
facilities:
$550 million senior secured revolving credit facility expiring May
2018 at Ba2 (LGD 3, 47%)
$420 million senior secured term loan (including $150 million
delayed draw commitment) due May 2018 at Ba2 (LGD 3, 47%)
Moody's affirmed the following ratings:
Corporate Family Rating at Ba2
Probability of Default Rating at Ba2-PD
Moody's upgraded the following rating:
Speculative Grade Liquidity Rating to SGL-1 from SGL-3
The outlook is stable.
Moody's withdrew the following ratings, given the completion of
the amendment:
Senior secured revolving credit facility expiring 2016 at Ba1 (LGD
2, 26%)
Senior secured term loan due 2015 at Ba1 (LGD 2, 26%)
Ratings Rationale:
The Ba2 Corporate Family Rating reflects Charles River's leading
competitive position in its core markets, particularly in the
Research Models and Services ("RMS") business where it is the
largest player globally. The ratings are also supported by the
company's good geographic and customer diversity. Charles River's
leverage is moderate, having repaid a significant amount of debt
with free cash flow over the past two years. The ratings are
constrained by the company's modest absolute size and its focus on
niche markets which have modest growth prospects over the next 1-2
years. Further, the ratings reflect the company's demonstrated
appetite for debt funded share repurchases and acquisitions,
although Moody's expects that Charles River's acquisitions will be
mostly of bolt-on nature over the next 1-2 years.
The upgrade of the Speculative Grade Liquidity rating reflects the
upsized revolver and delayed draw term loan which will provide
ample liquidity to repay the convertible bond as well as
additional leverage covenant cushion provided by the amendment.
Moody's expects Charles River to continue to have strong free cash
flow.
Moody's could upgrade the ratings if the company demonstrates
sustained, organic revenue growth in both its RMS and Preclinical
Services ("PCS") businesses, and if Moody's expects leverage to be
below 2.5 times and free cash flow to debt above 20%. If Charles
River experiences declines in profits due to competitive pressures
or overall market contraction, such that adjusted leverage is
expected to be sustained above 4.0 times, Moody's could downgrade
the ratings. Additionally, deterioration in operating cash flow or
a significant increase in capital expenditures such that free cash
flow to debt is sustained below 15% could result in a downgrade.
Further, increased debt to fund acquisitions or share repurchases,
leading to erosion of credit metrics beyond the stated levels,
could also lead to a downgrade.
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.
Charles River Laboratories International, Inc. (NYSE: CRL)
headquartered in Wilmington, MA, is a contract research
organization that provides research tools and services for drug
discovery and development. The company generates 61% of revenue
from the RMS business, which involves the commercial production
and sale of research models (e.g. rodents) and services to support
their use in research; and 39% from the PCS business, which
involves the development and safety testing of drug candidates.
The company reported revenues of approximately $1.1 billion for
the twelve months ended March 30, 2013.
CHARTER COMMUNICATIONS: Cash Tender Offer for Bresnan Securities
----------------------------------------------------------------
Charter Communications, Inc. on June 10 disclosed that its
indirect subsidiary, Charter Communications Operating, LLC has
commenced a tender offer to purchase for cash any and all of the
outstanding 8.00% Senior Notes due 2018 of Bresnan Broadband
Holdings, LLC (formerly BBHI Acquisition LLC). CCO will purchase
all Notes that are tendered prior to 5:00 p.m., New York City
time, on June 21, 2013, unless such time is extended or earlier
terminated by CCO for the Notes. The total principal amount of
the Notes outstanding is $250 million. CCO is also seeking
consents from the holders of the Notes to amendments to, among
other things, eliminate substantially all of the restrictive
covenants and events of default, and eliminate or modify related
provisions contained in the indenture governing the Notes. Notes
that are validly tendered prior to the Consent Payment Deadline,
and accepted for purchase, will receive the total consideration as
set forth in the table below per $1,000 aggregate principal amount
of Notes, plus accrued and unpaid interest to but excluding the
First Settlement Date. Subject to certain conditions being met,
the First Settlement Date is expected to be July 1, 2013.
Issuer
Bresnan Broadband Holdings, LLC
CUSIP Nos. Title of Security
107342 AA5 Senior Notes due 2018
Consent Payment Deadline
5:00 P.M., EST, on June 21, 2013
Tender Consideration(1)
$1,063.60
Consent Payment(2)
$30.00
Total Consideration(1)
$1,093.60
(1) Does not include accrued and unpaid interest to but excluding
the applicable settlement date, which will be paid on Notes
accepted for purchase.
(2) Represents a consent fee for the Notes tendered on or prior to
the Consent Payment Deadline.
The tender offer is scheduled to expire at 11:59 p.m. New York
City time, on July 8, 2013, unless extended or earlier terminated.
Tendered Notes may be withdrawn and related consents to the
Proposed Amendments may be revoked at any time on or prior to 5:00
p.m. New York City time, on June 21, 2013, unless such time is
extended by the Company. Tenders of Notes may not be withdrawn
after the Withdrawal Deadline except to the extent required by
applicable law and consents to the Proposed Amendments may not be
revoked after the supplemental indenture setting forth the
Proposed Amendments has been entered into by the Issuer and the
Trustee. Holders of Notes may not tender their Notes without
consenting to the Proposed Amendments and may not withdraw their
consents to the Proposed Amendments without withdrawing the
related Notes from the tender offer; provided that after the
Supplemental Indenture has been entered into, previously delivered
consents may no longer be revoked. Therefore, a withdrawal of
tendered Notes after the execution and delivery of the
Supplemental Indenture and prior to the Withdrawal Deadline will
not revoke a Consent delivered prior to the execution and delivery
of the Supplemental Indenture. Payment for Notes validly tendered
and not validly withdrawn on or prior to the Withdrawal Deadline
and accepted for purchase will be made promptly following the
Consent Payment Deadline. Payment for Notes tendered after the
Consent Payment Deadline accepted for purchase will be made
promptly following the Expiration Time. Holders of Notes that are
validly tendered after the Consent Payment Deadline and on or
prior to the Expiration Time, and accepted for purchase, will
receive only the tender consideration set forth in the table above
and not the consent payment. Accrued interest up to, but not
including, the applicable settlement date of the Notes will be
paid in cash on all validly tendered and accepted Notes.
The consummation of the tender offer for the Notes is conditioned
upon consummation of the acquisition of Bresnan, which the Company
expects to close on July 1, 2013. The Proposed Amendments will
become effective with respect to the indenture governing the Notes
only upon consummation of the Acquisition and only if consents are
received with respect to a majority in aggregate principal amount
of the Notes. The tender offer and the related Consent
Solicitation is also subject to the satisfaction or waiver of
certain other conditions as set forth in the Offer to Purchase and
Consent Solicitation referred to below.
The complete terms and conditions of the tender offer and the
Consent Solicitation are set forth in an Offer to Purchase and
Consent Solicitation Statement that is being sent to holders of
the Notes. Holders are urged to read this document carefully
before making any decision with respect to the tender offer and
Consent Solicitation. Holders of Notes must make their own
decisions as to whether to tender their Notes and consent to the
Proposed Amendments, and if they decide to do so, the principal
amount of the Notes to tender.
Holders may obtain copies of the Offer to Purchase and Consent
Solicitation Statement from the Information Agent for the tender
offer and Consent Solicitation, Global Bondholder Services
Corporation, at (212) 430-3774 (collect) and (866) 924-2200 (toll
free).
Credit Suisse Securities (USA) LLC is serving as the Dealer
Manager for the tender offer. Questions regarding the tender
offer and Consent Solicitation may be directed to Credit Suisse
Securities (USA) LLC, Liability Management Group at (800) 820-1653
(toll free) or (212) 325-2476.
Neither the Company, the Issuer, the Dealer Manager, the
Information Agent nor any other person makes any recommendation as
to whether holders of Notes should tender their Notes and deliver
consents to the Proposed Amendments, and no one has been
authorized to make such a recommendation.
This announcement is not an offer to purchase, or the solicitation
of an offer to sell the Notes. The tender offers may only be made
pursuant to the terms of the Offer to Purchase and Consent
Solicitations and the related Letter of Transmittal.
About Charter Communications
Based in St. Louis, Missouri, Charter Communications, Inc. (Pink
OTC: CHTRQ) -- http://www.charter.com/-- is a broadband
communications company and the fourth-largest cable operator in
the United States.
Charter Communications and more than a hundred affiliates filed
voluntary Chapter 11 petitions on March 27, 2009 (Bankr. S.D.N.Y.
Case No. 09-11435).
The Hon. James M. Peck presides over the cases. Richard M. Cieri,
Esq., Paul M. Basta, Esq., and Stephen E. Hessler, Esq., at
Kirkland & Ellis LLP, in New York, served as counsel to the
Debtors, excluding Charter Investment Inc. Albert Togut, Esq., at
Togut, Segal & Segal LLP in New York, served as Charter
Investment, Inc.'s bankruptcy counsel.
Charter Communications emerged from Chapter 11 under its pre-
arranged Joint Plan of Reorganization, which was confirmed by the
Court on Nov. 17, 2009. The Plan was declared effective Nov. 30,
2009.
CODA HOLDINGS: Lio Energy and Miles Electric File for Chapter 11
----------------------------------------------------------------
Miles Electric Vehicles Limited and Lio Energy Systems Holdings
LLC sought Chapter 11 protection (Bankr. D. Del. Case No. 13-11511
and 13-1152) on June 11, 2013.
Miles Electric and Lio each estimated at least $10 million in
assets and at least $50 million in liabilities.
Lio Energy and Miles Electric quickly sought and obtained an order
directing joint administration of their respective bankruptcy
cases with Coda Holdings, Inc., et al.
Coda in May sought bankruptcy protection and sought approval to
sell assets. As part of a comprehensive settlement with the
lenders and the official committee of unsecured creditors, the
Debtors have determined that it is necessary for Lio and Miles to
seek Chapter 11 and join the other Debtors as sellers.
Lio Energy is a guarantor of the Debtors' note obligations and the
DIP financing facility. Miles Electric, a Hong Kong entity and
Lio's direct subsidiary, is also a guarantor.
Coda has a deal to sell the business to lenders and noteholders,
led by an affiliate of Fortress Investment Group for $25 million,
absent higher and better offers in an auction.
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.
DELTEK INC: Moody's Rates 1st Lien Debt B1 & 2nd Lien Debt Caa2
---------------------------------------------------------------
Moody's Investors Service, affirmed Deltek, Inc.'s B3 corporate
family rating and B3-PD probability of default rating and assigned
a B1 rating to its proposed first lien debt facilities and Caa2 to
its proposed second lien debt facilities.
The debt facilities will be used to refinance existing debt and
fund a $242 million distribution to shareholders. Deltek is owned
by private equity group Thoma Bravo. The ratings outlook is
stable.
Ratings Rationale:
Though total debt is increasing approximately $230 million
dollars, the company has made significant progress in reducing the
cost structure since the going private transaction in October
2012, which combined with healthy organic growth results in pro
forma leverage levels similar to leverage at close of the buyout
and a major consideration in affirming the B3 corporate family
rating. Non-GAAP revenues have increased 8% for the quarter ended
March 31 2013 compared to a year earlier period despite
significant curtailment of government budgets and pro forma EBITDA
has increased approximately 70% as a result of reduced cost
structure and revenue growth. While Moody's remains cautious about
the ultimate impact of reduced government spending on Deltek's
customer base, the critical nature of its products are driving
resiliency in the business. Nonetheless, the B3 rating reflects
the very high leverage pro forma for the transaction (estimated at
just under 8x on a Moody's adjusted basis including run rate cost
savings) and the aggressive financial policy of the company and
private equity owners. While EBITDA understates the cash
collections of a growing software business, even adjusting for
cash collections, leverage is still considered very high. If the
company continues to demonstrate resilience in the government
business and drive free cash flow to debt levels sustainably above
5% and leverage below 7x, the ratings could be upgraded. The
ratings could face downgrade if leverage exceeds 9x or if a
deterioration in the business leads to negative free cash flow.
The debt instrument ratings were determined in conjunction with
Moody's Loss Given Default Methodology and reflect the relative
positions of the debt in the capital structure.
Issuer: Deltek, Inc.
Assignments:
$600M Senior Secured Bank Credit Facility, Assigned B1
$280M Senior Secured Bank Credit Facility, Assigned Caa2
$600M Senior Secured Bank Credit Facility, Assigned a range of
LGD3, 31 %
$280M Senior Secured Bank Credit Facility, Assigned a range of
LGD5, 83 %
The principal methodology used in this rating was Global Software
Industry published in October 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.
Headquartered in Herndon, Virginia, Deltek is a producer of
project focused enterprise software for government contracting and
professional service end-markets. Deltek had approximately $310
million in GAAP revenue for the last twelve months ended March 31,
2013.
DOLE FOOD: S&P Puts 'B' CCR on CreditWatch Negative
---------------------------------------------------
Standard & Poor's Ratings Services placed its ratings, including
its 'B' long-term corporate credit rating, on Westlake Village,
Calif.-based Dole Food Co. Inc. on CreditWatch with negative
implications, meaning that S&P could lower or affirm the ratings
following the completion of its review.
S&P estimates that Dole had about $1.6 billion in reported debt
outstanding as of March 23, 2013, prior to the divestiture of its
worldwide packaged foods and Asian fresh produce businesses.
Following the completion of this divestiture and the associated
refinancing transactions, S&P estimates the company had less than
$900 million in reported outstanding debt.
Dole's CreditWatch negative listing follows the announcement by
David H. Murdock, Dole's chairman of the board and chief executive
officer, that he has offered to acquire the approximately 60% of
outstanding shares of common stock of Dole not already owned by
him for $12.00 per share in cash, plus the assumption of the
company's debt and other obligations.
"While details about the company's associated financing plans or
additional debt needs have not been disclosed, we believe the
transaction could weaken Dole's credit protection measures well
below current levels," said Standard & Poor's credit analyst
Jeffrey Burian. "We will resolve the CreditWatch listings
following our review of the financial impact of the transaction
when more details emerge, including financing plans."
DUNE ENERGY: Stockholders Elect Seven Directors to Board
--------------------------------------------------------
Dune Energy, Inc., held its 2013 annual meeting of stockholders on
June 5, at which the stockholders:
(i) elected Marjorie L. Bowen, John R. Brecker, Michael R.
Keener, Alexander A. Kulpecz, Jr., Robert A. Schmitz, Eric
R. Stearns and James A. Watt to serve on the board of
directors during 2013 and until the Company's next annual
meeting;
(ii) ratified the appointment of MaloneBailey LLP as independent
registered public accounting firm of the Company for the
fiscal year ending Dec. 31, 2013;
(iii) approved an advisory vote on the compensation of the named
executive officers;
(iv) indicated "One Year" as the frequency of stockholder votes
on executive compensation; and
(v) approved an amendment to the Dune Energy, Inc. 2012 Stock
Incentive Plan.
About Dune Energy
Dune Energy, Inc. (NYSE AMEX: DNE) -- http://www.duneenergy.com/
-- is an independent energy company based in Houston, Texas.
Since May 2004, the Company has been engaged in the exploration,
development, acquisition and exploitation of natural gas and crude
oil properties, with interests along the Louisiana/Texas Gulf
Coast. The Company's properties cover over 90,000 gross acres
across 27 producing oil and natural gas fields.
Dune Energy disclosed a net loss of $7.85 million in 2012, as
compared with a net loss of $60.41 million in 2011. The Company's
balance sheet at March 31, 2013, showed $270.01 million in total
assets, $124.76 million in total liabilities and $145.25 million
in total stockholders' equity.
DYNEGY HOLDINGS: 4 Units Given Thru June 15 to Consummate Plan
--------------------------------------------------------------
The date by which the Effective Date of the confirmed Plan of four
operating subsidiary debtors of Dynegy, Inc. must occur has been
extended to June 15, 2013.
Operating Debtors Dynegy Northeast Generation, Inc.; Hudson
Power, LLC, Dynegy Danskammer, LLC, and Dynegy Roseton, LLC
L.L.C. obtained confirmation of their Joint Plan of Liquidation
last March 15, 2013.
As reported by The Troubled Company Reporter on March 12, 2013,
the Plan, as amended, provides for (1) the full recovery Class 1
Priority Claims and Class 2 Secured Claims, (2) a 11% to 19%
recovery for holders of Class 3 Gen. Unsecured Claims, (3) a 66%
to 99% recovery for holders of Class 4 Convenience Claims, and (4)
no recovery for holders of Class 6 Equity Interests in Dynegy
Northeast. Recovery for Class 5 Lease GUC Claims is unknown. A
copy of the latest version of the Amended Joint Liquidation Plan
is available at:
http://bankrupt.com/misc/DYNEGY_Subsidiaries'AmendedPlan_Mar08.pdf
Brian J. Lohan, Esq., James F. Conlan, Esq., Paul S. Caruso, Esq.,
Joel G. Samuels, Esq., of SIDLEY AUSTIN LLP, in New York,
represent the Debtors.
About Dynegy
Through its subsidiaries, Houston, Texas-based Dynegy Inc.
(NYSE: DYN) -- http://www.dynegy.com/-- produces and sells
electric energy, capacity and ancillary services in key U.S.
markets. The power generation portfolio consists of approximately
12,200 megawatts of baseload, intermediate and peaking power
plants fueled by a mix of natural gas, coal and fuel oil.
Dynegy Holdings LLC and four other affiliates of Dynegy Inc.
sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case
No. 11-38111) on Nov. 7, 2011, to implement an agreement with a
group of investors holding more than $1.4 billion of senior notes
issued by Dynegy's direct wholly-owned subsidiary, Dynegy
Holdings, regarding a framework for the consensual restructuring
of more than $4.0 billion of obligations owed by DH. If this
restructuring support agreement is successfully implemented, it
will significantly reduce the amount of debt on the Company's
consolidated balance sheet. Dynegy Holdings disclosed assets of
$13.77 billion and debt of $6.18 billion.
Dynegy Inc. on July 6, 2012, filed a voluntary petition to
reorganize under Chapter 11 (Bankr. S.D.N.Y. Case No. 12-36728) to
effectuate a merger with Dynegy Holdings, pursuant to Holdings'
Chapter 11 plan.
Dynegy Holdings and its affiliated debtor-entities are represented
in the Chapter 11 proceedings by Sidley Austin LLP as their
reorganization counsel. Dynegy and its other subsidiaries are
represented by White & Case LLP, who is also special counsel to
the Debtor Entities with respect to the Roseton and Danskammer
lease rejection issues. The financial advisor is FTI Consulting.
The Official Committee of Unsecured Creditors in Holdings' cases
has tapped Akin Gump Strauss Hauer & Feld LLP as counsel.
Dynegy Holdings and its parent, Dynegy Inc., completed their
Chapter 11 reorganization and emerged from bankruptcy Oct. 1,
2012. Under the terms of the DH/Dynegy Plan, DH merged with and
into Dynegy, with Dynegy, Inc., remaining as the surviving entity.
Dynegy Northeast Generation, Inc., Hudson Power, L.L.C., Dynegy
Danskammer, L.L.C. and Dynegy Roseton, L.L.C., won confirmation of
their plan of liquidation in March 2013, allowing the former
operating units of Dynegy to consummate a settlement agreement
resolving some lease trustee claims and sell their facilities.
DYNEGY INC: Disbursing Agent Can File Claim Objections Til Oct. 14
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
has granted the request of Reorganized Dynegy Inc., as disbursing
agent under the confirmed Chapter 11 Plan, for an extension of the
deadline for filing of claim objections through October 14, 2013.
About Dynegy
Through its subsidiaries, Houston, Texas-based Dynegy Inc.
(NYSE: DYN) -- http://www.dynegy.com/-- produces and sells
electric energy, capacity and ancillary services in key U.S.
markets. The power generation portfolio consists of approximately
12,200 megawatts of baseload, intermediate and peaking power
plants fueled by a mix of natural gas, coal and fuel oil.
Dynegy Holdings LLC and four other affiliates of Dynegy Inc.
sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case
No. 11-38111) on Nov. 7, 2011, to implement an agreement with a
group of investors holding more than $1.4 billion of senior notes
issued by Dynegy's direct wholly-owned subsidiary, Dynegy
Holdings, regarding a framework for the consensual restructuring
of more than $4.0 billion of obligations owed by DH. If this
restructuring support agreement is successfully implemented, it
will significantly reduce the amount of debt on the Company's
consolidated balance sheet. Dynegy Holdings disclosed assets of
$13.77 billion and debt of $6.18 billion.
Dynegy Inc. on July 6, 2012, filed a voluntary petition to
reorganize under Chapter 11 (Bankr. S.D.N.Y. Case No. 12-36728) to
effectuate a merger with Dynegy Holdings, pursuant to Holdings'
Chapter 11 plan.
Dynegy Holdings and its affiliated debtor-entities are represented
in the Chapter 11 proceedings by Sidley Austin LLP as their
reorganization counsel. Dynegy and its other subsidiaries are
represented by White & Case LLP, who is also special counsel to
the Debtor Entities with respect to the Roseton and Danskammer
lease rejection issues. The financial advisor is FTI Consulting.
The Official Committee of Unsecured Creditors in Holdings' cases
has tapped Akin Gump Strauss Hauer & Feld LLP as counsel.
Dynegy Holdings and its parent, Dynegy Inc., completed their
Chapter 11 reorganization and emerged from bankruptcy Oct. 1,
2012. Under the terms of the DH/Dynegy Plan, DH merged with and
into Dynegy, with Dynegy, Inc., remaining as the surviving entity.
Dynegy Northeast Generation, Inc., Hudson Power, L.L.C., Dynegy
Danskammer, L.L.C. and Dynegy Roseton, L.L.C., won confirmation of
their plan of liquidation in March 2013, allowing the former
operating units of Dynegy to consummate a settlement agreement
resolving some lease trustee claims and sell their facilities.
EDISON MISSION: Patricia Chen Withdraws as Noteholders' Counsel
---------------------------------------------------------------
Patricia I. Chen, Esq., of the firm Ropes & Gray LLP, withdrew as
counsel for the Ad Hoc Committee of Senior Noteholders of Edison
Mission Energy, et al. The withdrawal is limited to Patricia I.
Chen, Esq., and does not impact the representation of the Ad Hoc
Committee of Senior Noteholders of Edison Mission Energy by other
Ropes & Gray LLP attorneys.
Ms. Chen will no longer be an associate with Ropes & Gray LLP
after June 7, 2013.
About Edison Mission
Santa Ana, California-based Edison Mission Energy is a holding
company whose subsidiaries and affiliates are engaged in the
business of developing, acquiring, owning or leasing, operating
and selling energy and capacity from independent power production
facilities. EME also engages in hedging and energy trading
activities in power markets through its subsidiary Edison Mission
Marketing & Trading, Inc.
EME was formed in 1986 and is an indirect subsidiary of Edison
International. Edison International also owns Southern California
Edison Company, one of the largest electric utilities in the
United States.
EME and its affiliates sought Chapter 11 protection (Bankr. N.D.
Ill. Lead Case No. 12-49219) on Dec. 17, 2012.
EME has reached an agreement with the holders of a majority of
EME's $3.7 billion of outstanding public indebtedness and its
parent company, Edison International EIX, that, pursuant to a plan
of reorganization and pending court approval, would transition
Edison International's equity interest to EME's creditors, retire
existing public debt and enhance EME's access to liquidity.
The Company's balance sheet at Sept. 30, 2012, showed
$8.17 billion in total assets, $6.68 billion in total liabilities
and $1.48 billion in total equity.
In its schedules, Edison Mission Energy disclosed total assets of
assets of $5,721,559,170 and total liabilities of $6,202,215,094
as of the Petition Date.
Kirkland & Ellis LLP is serving as legal counsel to EME, Perella
Weinberg Partners, LP is acting as financial advisor and McKinsey
Recovery & Transformation Services U.S., LLC is acting as
restructuring advisor. GCG, Inc., is the claims and notice agent.
An official committee of unsecured creditors has been appointed in
the case and is represented by the law firms Akin Gump and Perkins
Coie. The Committee also has tapped Blackstone Advisory Partners
as investment banker and FTI Consulting as financial advisor.
EME said it doesn't plan to emerge from Chapter 11 until December
2014 to receive benefits from a tax-sharing agreement with parent
Edison International Inc.
EXCEL MARITIME: Lenders Begin Voting on Prepackaged Plan
--------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that creditors of Excel Maritime Carriers Ltd. began
voting on a prepackaged Chapter 11 reorganization where secured
lenders owed $771 million will take ownership while current owner
Gabriel Panayotides in substance buys an option to regain part
ownership.
The report relates that lenders are to finish voting by June 28,
meaning that the in-court reorganization process could begin by
the month's end.
The plan, the report relates, will give the lenders restructured
secured notes for $771 million plus all of the new stock. Trade
suppliers owed $16.5 million will be paid in full in the ordinary
course of business to avoid having the vessels seized. Other
unsecured creditors and holders of the convertible notes, with
claims totaling $163 million, are to have a 3 percent recovery,
according to the company's disclosure statement. Their recovery
will come from a $5 million cash-flow note to be issued by a non-
bankrupt joint-venture affiliate named Christine Shipco LLC.
According to the report, Excel claims the company's enterprise
value ranges from $575 million to $625 million, with a midpoint of
$600 million. Based on the midpoint, the disclosure statement
shows a 77 percent recovery by the senior lenders.
The report shares that Mr. Panayotides is scheduled to buy
60 percent of the stock from the lenders for a $10 million
unsecured note and the turnover to the company of a $20 million
escrow account. He will have the right to buy another 15 percent
by March 2015 for $20 million. If he doesn't buy the additional
stock, the lenders' equity ownership will rise to 75 percent. If
he purchases the additional stock, the new notes will mature in
2018. Otherwise, they mature a year earlier.
The Bloomberg report discloses that the new notes require first
principal payments in April 2014 and will pay interest partly with
issuance of more notes. The reorganization plan is based on the
notion contained in U.S. bankruptcy law referred to as the 1111(b)
election. Employing the election, the lenders carry over the
entire amount of their secured debt to the reorganized company.
About Excel Maritime
Based in Athens, Greece, Excel Maritime Carriers Ltd. --
http://www.excelmaritime.com/-- is an owner and operator of dry
bulk carriers and a provider of worldwide seaborne transportation
services for dry bulk cargoes, such as iron ore, coal and grains,
as well as bauxite, fertilizers and steel products. Excel owns a
fleet of 40 vessels and, together with 7 Panamax vessels under
bareboat charters, operates 47 vessels (5 Capesize, 14 Kamsarmax,
21 Panamax, 2 Supramax and 5 Handymax vessels) with a total
carrying capacity of approximately 3.9 million DWT. Excel Class A
common shares have been listed since Sept. 15, 2005, on the New
York Stock Exchange (NYSE) under the symbol EXM and, prior to that
date, were listed on the American Stock Exchange (AMEX) since
1998.
The company blamed financial problems on low charter rates.
The balance sheet for December 2011 had assets of $2.72 billion
and liabilities totaling $1.16 billion. Excel owes $771 million
to secured lenders with liens on almost all assets. There is $150
million owing on 1.875 percent unsecured convertible notes.
The company had a $211.6 million net loss on revenue of $356.9
million in 2011.
EXIDE TECHNOLOGIES: Wins Approval of First Day Motions
------------------------------------------------------
Exide Technologies on Tuesday obtained approval from Judge Kevin
J. Carey of its "first day" motions including a proposal to pay up
to $7 million in prepetition claims of select vendors that supply
goods and services essential to the Debtor's continued operation.
Judge Carey approved the critical vendor motion on an interim
basis. The Debtor will seek approval to pay a total of
$10 million for prepetition vendor claims at a hearing on July 11.
The bankruptcy judge also authorized the Debtor to pay up to
$1 million in prepetition obligations to foreign suppliers. The
Debtor will seek to increase the cap to $2 million at the July
hearing.
The Debtor, following a hearing on June 11, also obtained interim
approval to implement procedures to limit trading of equity
securities, grant adequate assurance to utilities, maintain
insurance policies, pay prepetition taxes, and continue its
customer programs.
As of March 31, 2013, the Debtor had approximately $135 million of
unlimited net operating losses (NOLs) that were available to
offset taxable income and approximately $50 million of NOLs that
were available to offset taxable income but were subject to a so-
called Section 382 Limitation due to a prior ownership change. To
protect and preserve the value of the Debtor's tax attributes, the
proposed rules provide that any transfer of the equity securities
that would result in another entity becoming a substantial
equityholder (holder of at least 3,768,323 shares or 4.75% of the
shares outstanding) would require approval from the Debtor.
Also at the Debtor's behest, the deadline to file its formal
schedules of assets and liabilities has been extended to Aug. 9,
2013.
About Exide Technologies
Headquartered in Princeton, New Jersey, Exide Technologies
(NASDAQ: XIDE) -- http://www.exide.com/-- manufactures and
distributes lead acid batteries and other related electrical
energy storage products.
Exide first sought Chapter 11 protection (Bankr. Del. Case No.
02-11125) on April 14, 2002 and exited bankruptcy two years later.
Matthew N. Kleiman, Esq., and Kirk A. Kennedy, Esq., at Kirkland &
Ellis, and James E. O'Neill, Esq., at Pachulski Stang Ziehl &
Jones LLP represented the Debtors in their successful
restructuring.
Exide returned to Chapter 11 bankruptcy (Bankr. D. Del. Case No.
13-11482) on June 10, 2013. For the new case, Exide has tapped
Anthony W. Clark, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, and Pachulski Stang Ziehl & Jones LLP as counsel; Alvarez &
Marsal as financial advisor; Sitrick and Company Inc. as public
relations consultant and GCG as claims agent.
The Debtor disclosed $1.89 billion in assets and $1.14 billion in
liabilities as of March 31, 2013.
EXIDE TECHNOLOGIES: $500-Mil. DIP Financing Has Interim Approval
----------------------------------------------------------------
Exide Technologies sought and obtained interim approval of its
request to obtain DIP financing of $500 million from JPMorgan
Chase Bank, N.A. and prepetition noteholders.
The DIP Facilities are comprised of:
(i) a first-out superpriority, secured, asset-based revolving
credit facility in the principal amount of $225,000,000; and
(ii) a second-out superpriority, multiple-draw secured term loan
facility in an aggregate principal amount of $275,000,000.
The Honorable Judge Kevin J. Carey authorized the Company to
access up to $395 million of the DIP Financing Facility -- the
full $225 million of the ABL revolving credit facility and $170
million of the term loan facility.
A hearing is slated for July 11, 2013 at 10:00 a.m., when Judge
Carey will consider whether to grant final approval of the DIP
loans and allow the Debtor to access the remaining $105 million.
Objections are due July 3.
"We are pleased with the approval by the Court of our 'first day
motions,' particularly the DIP financing which is a key lynchpin
to our go-forward business strategy. With this important step
behind us, we can focus on servicing the needs of our customers in
a timely and uninterrupted basis and continue businesses around
the globe in the ordinary course," said Chief Executive Officer of
Exide Technologies, James R. Bolch.
Exide said in court filings that the DIP Facilities will replace
the Debtor's existing asset backed loan (ABL) facility provided by
Wells Fargo Capital Financing, LLC, as administrative agent, and a
group of lenders party thereto, as to which there is approximately
$160 million in borrowings and letters of credit outstanding.
Additionally, the DIP Facilities will prime the Debtor's 8.625%
senior secured notes in the principal amount of $675 million that
mature on February 1, 2018 with the support of an unofficial
committee of holders of a significant block of the senior secured
notes.
"This is not a so-called 'roll-up,' nor is it an instance where
the same lending group is paying its prepetition facility with
monies advanced post-petition. Rather, the Debtor has reached out
to different lenders, and proposes to pay off the prepetition ABL
Facility because, among other things, the substitute DIP ABL
Facility offered by JPMCB provides the Debtor with more liquidity
than if the existing ABL Facility was left in place and the Debtor
tried to finance around it," explains counsel to the Debtor,
Anthony W. Clark, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP.
"In any event, the obligations owed pursuant to the ABL Facility
are substantially oversecured by properly-perfected liens and
security interests, and the Debtor proposes to retain for any
official committee of unsecured creditors appointed in the Chapter
11 Case the customary ability to investigate and contest such
facts."
The DIP facility will mature in 16 months. However, the Debtor is
required to achieve these milestones:
* By no later than six months after the Petition Date,
finalize a business plan in form and substance acceptable to
the DIP Agent and the DIP Lenders.
* By no later than nine months after the Petition Date, file
with the Bankruptcy Court a proposed Acceptable
Reorganization Plan.
* By no later than 12 months after the Petition Date, commence
solicitation of acceptances for an Acceptable Reorganization
Plan pursuant to a disclosure statement and solicitation
procedures approved by the Bankruptcy Court.
* By no later than 15 months after the Petition Date, gain
entry of an order of the Bankruptcy Court confirming an
Acceptable Reorganization Plan.
* By no later than the first Business Day that occurs 16
months after the Closing Date, the effective date of an
Acceptable Reorganization Plan will have occurred.
By default, interest on the DIP ABL Facility is charged based upon
the "Base Rate." The base rate is defined in the DIP Credit
Agreement to mean the greatest of (a) the Federal Funds Rate plus
0.50%, (b) the rate of interest per annum publicly announced from
time to time by JPMCB as its prime rate in effect at its office
located at 270 Park Avenue, New York, New York (with each change
in such rate being effective from and including the date such
change is publicly announced as being effective) and (c) LIBOR
plus 1.00%.
Interest rates under the DIP ABL Facility are:
* LIBOR Rate Loans: LIBOR + 3.25%
* Base Rate Loans: Base Rate + 2.25%
* Swingline Loans: LIBOR + 3.25%
The DIP Term Facility will accrue interest at 9.0%.
The default rate is 2 percentage points above the otherwise
applicable rate.
The Debtor says that the rates, fees, and other expenses to be
paid in connection with the DIP Facilities are reasonable and are
in line with comparable fees for other post-petition financing
facilities.
A copy of the Interim DIP Order is available for free at
http://bankrupt.com/misc/Exide_Interim_DIP_Order.pdf
About Exide Technologies
Headquartered in Princeton, New Jersey, Exide Technologies
(NASDAQ: XIDE) -- http://www.exide.com/-- manufactures and
distributes lead acid batteries and other related electrical
energy storage products.
Exide first sought Chapter 11 protection (Bankr. Del. Case No.
02-11125) on April 14, 2002 and exited bankruptcy two years alter.
Matthew N. Kleiman, Esq., and Kirk A. Kennedy, Esq., at Kirkland &
Ellis, and James E. O'Neill, Esq., at Pachulski Stang Ziehl &
Jones LLP represented the Debtors in their successful
restructuring.
Exide Technologies returned to Chapter 11 bankruptcy (Bankr. D.
Del. Case No. 13-11482) on June 10, 2013.
For the new case, Exide has tapped Anthony W. Clark, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, and Pachulski Stang
Ziehl & Jones LLP as counsel; Alvarez & Marsal as financial
advisor; Sitrick And Company Inc. as public relations consultant
and GCG as claims agent.
The Debtor disclosed $1.89 billion in assets and $1.14 billion in
liabilities as of March 31, 2013.
Exide's international operations were not included in the filing
and will continue their business operations without supervision
from the U.S. courts. The Company has also established two
separate toll-free information lines: one for U.S. suppliers, 888-
985-9831 and another for other interested parties, 855-291-0287.
EXIDE TECHNOLOGIES: Wins Approval for GCG as Claims Agent
---------------------------------------------------------
Exide Technologies sought and obtained approval to employ GCG
Inc., as claims and noticing agent.
The Debtor has not yet filed its schedules of assets and
liabilities but it anticipates that there will be in excess of
20,000 entities to be noticed. In view of the number of
anticipated claimants, the Debtor submits that appointment of a
claims and noticing agent is both necessary and the best interest
of both the Debtor's estates and its creditors.
GCG received a retainer of $132,000.
GCG has agreed to provide discounted hourly rates and agreed to
cap the highest hourly rate at $295:
Position Discounted Rate
-------- ---------------
Administrative and Claims Control $45 to $55
Project Administrators $70 to $85
Project Supervisors $95 to $110
Systems, Graphic Support & Tech Staff $100 to $200
Project Managers and Sr. Project Managers $125 to $175
Directors and Asst. Vice Presidents $200 to $295
Vice Presidents and above $295
For its noticing services, GCG will charge $50 per 1,000 e-mails,
and $0.10 per page for facsimile noticing. For its claims
administration services, GCG will charge $0.15 per claim for
association of claimants' names and addresses to the database, and
will bill at its discounted hourly rates for processing of claims.
For solicitation and processing of ballots, GCG will charge
at its standard hourly rates. For its contact services, the firm
will charge $0.39 per minute for its interactive voice response
("IVR") service and $0.95 per minute for customer service
representatives.
About Exide Technologies
Headquartered in Princeton, New Jersey, Exide Technologies
(NASDAQ: XIDE) -- http://www.exide.com/-- manufactures and
distributes lead acid batteries and other related electrical
energy storage products.
Exide first sought Chapter 11 protection (Bankr. Del. Case No.
02-11125) on April 14, 2002 and exited bankruptcy two years later.
Matthew N. Kleiman, Esq., and Kirk A. Kennedy, Esq., at Kirkland &
Ellis, and James E. O'Neill, Esq., at Pachulski Stang Ziehl &
Jones LLP represented the Debtors in their successful
restructuring.
Exide returned to Chapter 11 bankruptcy (Bankr. D. Del. Case No.
13-11482) on June 10, 2013. For the new case, Exide has tapped
Anthony W. Clark, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, and Pachulski Stang Ziehl & Jones LLP as counsel; Alvarez &
Marsal as financial advisor; Sitrick and Company Inc. as public
relations consultant and GCG as claims agent.
The Debtor disclosed $1.89 billion in assets and $1.14 billion in
liabilities as of March 31, 2013.
EXIDE TECHNOLOGIES: S&P Lowers CCR to 'D' Over Chapter 11 Filing
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Milton, Ga.-based battery manufacturer Exide
Technologies to 'D' from 'CCC+', and lowered its issue-level
ratings on Exide's $675 million senior secured notes (due 2018) to
'D' from 'CCC+'. The recovery rating on this debt remains
unchanged at '4', indicating S&P's expectation that lenders would
receive average (30% to 50%) recovery in the event of a payment
default. S&P also lowered the rating on Exide's $60 million
convertible senior subordinated debt due 2013 to 'D' from 'CCC-'.
The recovery rating on the convertible debt remains unchanged at
'6', indicating S&P's expectation of negligible (0 to 10%)
recovery.
The rating actions follow the company's announcement that it filed
a voluntary Chapter 11 petition under the U.S. Bankruptcy Code on
June 10, 2013. The company's international operations are not
part of the bankruptcy filing.
Additionally, the company has announced that it has negotiated a
$500 million debtor-in-possession (DIP) financing facility
(comprising a $225 million asset based loan revolving credit
facility, and a $275 million term loan facility) in connection
with the filing, pending court approval. The company expects to
use the proceeds of the DIP financing to repay $160 million
outstanding (including letters of credit) under the prepetition
asset-backed revolving credit facility.
"We expect to evaluate the business risk and financial risk of the
company in reassessing the post-emergence corporate credit
rating," said Standard & Poor's credit analyst Nishit Madlani.
FEDERAL-MOGUL CORP: Moody's Rates New Secured Term Loan 'Ba3'
-------------------------------------------------------------
Moody's Investors Service assigned the following ratings to the
proposed obligations that are part of Federal-Mogul Corporation's
plan to recapitalize its balance sheet: Ba2 rating to a $550
million asset based revolving credit facility; Ba3 rating to a
$1.75 billion senior secured term loan facility, and Caa1 rating
to $750 million of senior unsecured notes. An additional component
of the recapitalization is an already-commenced $500 million
rights offering. In related action, Federal-Mogul's Corporate
Family (CFR) and Probability of Default (PDR) Ratings are
unchanged at B2 and B2-PD, respectively. The Speculative Grade
Liquidity Rating remains at SGL-3. The rating outlook remains
stable.
The newly rated debt facilities are in connection with Federal-
Mogul's previously announced intention to refinance its
outstanding indebtedness. The company expects to complete the
refinancing shortly after the completion a $500 million rights
offering. The company has publically indicated that the completion
of the refinancing is expected to be conditioned upon the
completion of the rights offering which was launch on June 7th,
2013 and expires on June 27th, 2013.
The following ratings were assigned:
Ba2 (LGD1, 4%) to the new $550 million asset based revolving
credit facility due 2018;
Ba3 (LGD2, 28%) to the new $1.75 billion senior secured term loan
B due 2020;
Caa1 (LGD5, 78%) to the new $750 million senior unsecured notes
due 2021
The following ratings are unchanged:
Corporate Family Rating, at B2;
Probability of Default Rating, at B2-PD;
SGL-3, Speculative Grade Liquidity Rating
Existing $540 million senior secured asset based revolver at Ba3
(LGD3, 32%);
Non-extended amounts of the $1.96 billion senior secured term loan
due December 2014, at B1 (LGD3, 34%);
$1.0 billion senior secured term loan facility due December 2015,
which includes a $50 million senior secured synthetic letter of
credit facility and a $0.95 billion senior secured term loan, at
B1 (LGD3, 34%)
The ratings on the existing senior secured facilities will be
withdrawn up their refinancing.
Rating Rationale:
The B2 Corporate Family Rating reflects the benefits associated
with the proposed $500 million rights offering and the improved
liquidity that will result from the refinancing of Federal-Mogul's
debt. Federal-Mogul's pro forma leverage for the LTM period end
March 31, 2013 is expected to improve to about 8.0x from 8.6x
(including Moody's standard adjustments), which remains in the
high end of the assigned rating. In addition, the company's
leverage is expected to further improve, as recent quarterly
results and the company's preliminary unaudited financial outlook
for the quarter ending June 30, 2013 indicate that restructuring
actions are taking hold. Although the debt refinancing will
improve liquidity, the company will be replacing relatively low
interest rate debt with more expensive obligations. Hence, debt
service costs will rise. However, Moody's expects that the
company's operational improvements will largely offset this
increased interest burden. The combination of the rights offering,
debt refinancing, and improving performance is expected to enhance
Federal-Mogul's liquidity position and better position the credit
profile within the assigned B2 CFR.
Federal-Mogul is anticipated to maintain an adequate liquidity
profile over the next twelve months supported by cash balances
which, as of March 31, 2013, were $269 million. Based on the
company's announcements around the contemplated refinancing,
Moody's estimates that a portion of the net proceeds from the
rights offering will provide additional balance sheet cash on a
pro forma basis. The new $550 million asset based revolving
facility is expected to be unfunded at closing and largely
available over the next twelve months. Free cash flow is expected
to be modestly negative over the next twelve months as the company
manages restructuring actions to offset weakness in European
demand. As of March 31, 2013, the company had about $248 million
of factored accounts receivables which Moody's considers a
detractor to the liquidity profile. The new term loan is expected
to have nominal amortization requirements over the next twelve
months. The asset based revolving credit facility is expected to
have a springing fixed charge coverage test when availability
deteriorates below certain thresholds, while the new senior
secured term loan is not expected to have financial maintenance
covenants. Alternative forms of liquidity are expected to remain
available to Federal-Mogul through additional indebtedness baskets
allowed by the senior secured credit facilities.
Future events that have potential to drive Federal-Mogul's outlook
or ratings higher would result from stronger operating performance
leading to improvements in EBITA/Interest coverage approaching
3.0x, or in leverage below 4.0x.
Future events that have potential to drive Federal-Mogul's outlook
or ratings lower include further deterioration in revenues,
without offsetting restructuring actions, or material increases in
raw materials costs that cannot be passed on to customers, leading
to lower profitability. Consideration for a lower outlook or
rating could arise if any combination of these factors were to
result in EBITA/Interest coverage approaching 1.0x or debt/EBITDA
being sustained above 6.5x. A deterioration in liquidity could
also lead to a lower outlook or rating.
The principal methodology used in this rating was the Global
Automotive Supplier Industry Methodology published in May 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.
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.
FENWICK AUTOMOTIVE: Motorcar Parts Units File for Chapter 7
-----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Motorcar Parts of America Inc. allowed newly acquired
subsidiaries Introcar Inc. and Fenwick Automotive Products Ltd. to
file petitions for Chapter 7 liquidation (Bankr. D. Del. Case No.
13-bk-11499 and 13-bk-11500) on June 10.
According to the report, Fenwick, based in Toronto, and Introcar,
based in Torrance, California, both claimed their assets are less
than $10 million, with debt exceeding $100 million.
The parent MPA said in a statement that both subsidiaries are
separately capitalized. Fenwick was acquired in May 2011 in a $5
million transaction, according to data compiled by Bloomberg. MPA
said the subsidiaries had been unable to achieve cost savings
sufficient to justify continuing the involvement with the
companies.
The Bloomberg news reports that Torrance-based MPA reported net
income of $935,000 for the quarter ended December 31 on revenue of
$116.3 million. For the fiscal year ended Sept. 28, 2011, there
was a $48.5 million net loss on revenue of $363.7 million. The
operating loss in the year was $27.5 million.
FINJAN HOLDINGS: New Trading Symbol to Take Effect July 2
---------------------------------------------------------
Finjan Holdings, Inc., has been notified by FINRA that because of
administrative delays for purposes of implementing the new common
stock ticker symbol, the date of its previously announced trading
symbol change has been moved. Commencing Tuesday, July 2, 2013,
the Company's common shares are scheduled to start trading on the
OTC markets under the trading symbol "FNJN". The Company will
continue to trade as usual under the ticker symbol "COIND" until
this change is effective. The Company previously announced that
the new ticker symbol would commence June 11, 2013.
About Finjan
Finjan is a leading online security and technology company which
owns a portfolio of patents, related to software that proactively
detects malicious code and thereby protects end-users from
identity and data theft, spyware, malware, phishing, trojans and
other online threats. Founded in 1997, Finjan is one of the first
companies to develop and patent technology and software that is
capable of detecting previously unknown and emerging threats on a
real-time, behavior-based basis, in contrast to signature-based
methods of intercepting only known threats to computers, which
were previously standard in the online security industry.
Converted Organics disclosed a net loss of $8.42 million in 2012,
as compared with a net loss of $17.98 million in 2011. The
Company's balance sheet at March 31, 2013, showed $2.66 million in
total assets, $5.19 million in total liabilities, and a $2.53
million total stockholders' deficit.
Moody, Famiglietti & Andronico, LLP, in Tewksbury, Massachusetts,
issued a "going concern" qualification on the consolidated
financial statements for the year ended Dec. 31, 2012, citing
recurring losses and negative cash flows from operations and an
accumulated deficit that raises substantial doubt about the
Company's ability to continue as a going concern.
FLAT OUT: Hearing on Exclusivity Extension Adjourned to July 11
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York,
in a bridge order, adjourned to July 11, 2013, at 2 p.m., the
haring to consider Flat Out Crazy, LLC, et al.'s motion to extend
their exclusive periods to file a proposed Chapter 11 plan. The
Court's bridge order extends the exclusive periods to file a
proposed chapter 11 plan until July 15, and solicit acceptances
for that plan until Sept. 13.
About Flat Out Crazy
Flat Out Crazy LLC and its affiliates operate two Asian-inspired
restaurant chains that began in Chicago. Flat Top Grill, which
currently has 15 locations, is a full-service fast-casual create-
your-own stir-fry concept. Stir Crazy Fresh Asian Grill, which
has 11 locations, is a full-service casual Asian restaurant
offering the flavors of Chinese, Japanese, Thai and Vietnamese
food. The Debtors have 1,200 employees.
Flat Out Crazy and 13 affiliates sought Chapter 11 protection
(Bankr. S.D.N.Y. Lead Case No. 13-22094) in White Plains, New York
on Jan. 25, 2013. The Debtors have tapped Squire Sanders (US) LLP
as counsel; Kurtzman Carson Consultants, LLC, as claims, noticing
and administrative agent; William H. Henrich and Mark Samson from
Getzler Henrich as their co-chief restructuring officers; and J.H.
Chapman Group, L.L.C, as their investment bankers.
The Debtor disclosed $24,339,542 in assets and $15,899,166 in
liabilities as of the Chapter 11 filing.
An official committee of unsecured creditors has been appointed in
the Debtors' cases. The Committee tapped to retain Kelley Drye &
Warren LLP as its counsel and CBIZ Accounting, Tax and Advisory of
New York, LLC as financial advisor.
Tracy Hope Davis, the U.S. Trustee for Region 2, appointed Alan
Chapell, as the consumer privacy ombudsman in the Debtors' cases.
FNB UNITED: Closes Merger with Bank of Granite
----------------------------------------------
CommunityOne Bank, N.A., the principal bank subsidiary of FNB
United Corp., had completed the merger of its sister bank, Bank of
Granite, into CommunityOne on June 8, 2013. In addition,
CommunityOne's Consent Order with the Office of the Comptroller of
the Currency, which was issued on July 22, 2010, has been
terminated. With the termination of the Order, CommunityOne is
now considered "well capitalized" for purposes of the Federal
Deposit Insurance Act.
"We are excited that the merger is complete," said Brian Simpson,
chief executive officer of the Company. "This transaction was the
last step in our goal to successfully integrate CommunityOne and
Granite, and is critical to our return to profitability during the
second half of the year. We are also pleased that the OCC
terminated the Consent Order. This action is confirmation that we
are improving our financial condition and positioning our
franchise to better serve our customers throughout our footprint."
"The merger gives our customers full access to an expanded network
of 55 branches and 58 ATMs throughout central, southern and
western North Carolina, including Charlotte" added Bob Reid,
president of the Company. "We are pleased that we can now be a
unified presence under one brand."
Founded in 1907 in Asheboro, CommunityOne Bank is the third
largest community bank in North Carolina, operating 55 branches in
44 communities throughout the central, southern, and western
regions of the state.
About FNB United
Asheboro, N.C.-based FNB United Corp. (Nasdaq:FNBN) is the bank
holding company for CommunityOne Bank, N.A., and the bank's
subsidiary, Dover Mortgage Company. Opened in 1907, CommunityOne
Bank -- http://www.MyYesBank.com/-- operates 45 offices in 38
communities throughout central, southern and western North
Carolina. Through these subsidiaries, FNB United offers a
complete line of consumer, mortgage and business banking services,
including loan, deposit, cash management, wealth management and
internet banking services.
FNB United incurred a net loss of $40 million in 2012, a net loss
of $137.31 in 2011, and a net loss of $131.82 million in 2010.
The Company's balance sheet at March 31, 2013, showed $2.09
billion in total assets, $2 billion in total liabilities and
$89.37 million in total shareholders' equity.
FOOTHILL-EASTERN: S&P Assigns 'BB+' Rating to $207MM Revenue Bonds
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BBB-' long-term
rating to the Foothill-Eastern Transportation Corridor Agency
(F/ETCA or agency), Calif.'s approximately $1.43 billion series
2013A toll road refunding revenue bonds, $650 million series 2013C
toll road refunding revenue bonds, and $607 million series 2013D
forward delivery toll road refunding revenue bonds. In addition
Standard & Poor's assigned its 'BB+' long-term rating to the
agency's approximately $207 million series 2013B junior lien toll
road refunding revenue bonds. At the same time, Standard & Poor's
affirmed its 'BBB-' long-term and underlying ratings (SPUR) on the
agency's existing toll road revenue bonds. The outlook on all
ratings is stable.
"In our opinion, specific credit risks include the agency's high
debt levels and a debt service schedule that increases; recent
negative operational performance; uncertainty regarding elasticity
of tolls and the Foothill South toll road extension project, which
may require substantial additional debt; and slim aggregate
coverage levels and the subordinate nature of the of the junior
lien bonds," said Standard & Poor's credit analyst Todd Spence.
"We believe these risks are partially mitigated by the service
area's high wealth levels, high traffic on free highways, and
population that is reliant on the highway network," added Mr.
Spence.
The series 2013 refunding is restructuring debt service and
extending the final maturity from 2040 to 2053. Prior to the
restructuring, debt service increased at a 4.4% average annual
through 2040 to a maximum annual debt service of approximately
$298 million. Under the proposed restructuring scenario, the
final maturity is extended to 2053, and the aggregate (senior
and junior lien) debt service grows at a slower, although still
ascending, rate of approximately 3.5% through 2036, after which
debt service is level at approximately $193 million through 2043,
and then falls (after the junior lien bonds final maturity) to
approximately $179 million through 2053.
The agency plans to construct an extension to Foothill, known as
Foothill South, a 16-mile southern segment leading from the
current Foothill toll road terminus to Interstate 5 near the San
Diego County border. However, on Feb. 6, 2008, the California
Coastal Commission rejected certification of the project, a
decision that the U.S. Commerce Department upheld on Dec. 18,
2008. S&P understands that the agency has not abandoned its plans
and is currently working with stakeholders and exploring options,
including other alignments. The agency is also currently
evaluating a shorter, five mile extension, referred to as the
Tesoro Project, which extends the existing Foothill corridor to
the south. In S&P's view, the potential still exists for
substantial new debt to finance extensions although details are
very uncertain at this time.
FOREST OIL: S&P Revises Outlook to Negative & Affirms 'B+' CCR
--------------------------------------------------------------
Standard & Poor's Ratings Services said it revised its outlook on
Denver-based U.S. E&P company Forest Oil Corp. to negative from
stable.
S&P affirmed the 'B+' corporate credit rating. The issue rating
on Forest's senior secured debt is 'BB'. The recovery rating on
this debt is '1', indicating S&P's expectation of very high (90%
to 100%) recovery in the event of a payment default. The issue
rating on Forest's senior unsecured notes is 'B-', and the
recovery rating on this debt is '6', indicating S&P's expectation
of negligible (0% to 10%) recovery in the event of a payment
default.
"We are revising the outlook on Forest Oil Corp. to negative from
stable to reflect our assessment that the company's liquidity and
leverage measures could weaken meaningfully if the company is
unable to increase its crude oil production," said Standard &
Poor's credit analyst Marc Bromberg.
"The company's transition to crude oil from natural gas has been
slower than we expected, resulting in weak profitability and
credit protection measures. As a result, the company reported
that it had a thin cushion under its 4.5x debt to EBITDA leverage
covenant in the first quarter, and we anticipate that the cushion
will remain tight for the remainder of this year, effectively
limiting Forest to an incremental $50 million of availability on
its revolver based on our leverage projections. Under our current
assumptions and expectations and incorporating Forest's joint
venture (JV) with Schlumberger -- which reduces Forest's near-term
capital requirements in the Eagle Ford shale -- we expect Forest
to spend within cash flows for the remainder of 2013.
Nonetheless, if well production results are below our current
expectations, costs are higher, or the company requires additional
debt to fund its capital program, we believe liquidity and
leverage will weaken further, which could prompt at least a one-
notch downgrade," S&P added.
"The negative outlook reflects our assessment that there is a one
in three likelihood that we will lower the rating on Forest during
the next 12 months. We could lower the rating at least one notch
if we estimate that Forest will be unsuccessful developing its
crude oil prospects in the Eagle Ford and Texas Panhandle. Unless
the company can increase its proportion of more profitable oil as
we currently expect, we believe that the company could breach its
debt to EBITDA covenant, liquidity could weaken further, and debt-
to-EBITDA leverage could escalate above our 4.5x downgrade
trigger," S&P noted.
A revision to stable will require that the company is able to
develop its crude oil prospects, with production and costs in line
with S&P's current assumptions. If this occurs, S&P believes that
leverage could trend to approximately 4x in 2014 and that Forest
will have access to more funds under its revolving credit
facility.
The primary source of Forest's expected oil production growth is
the Eagle Ford Shale in South Texas.
FOTOLIA HOLDINGS: Moody's Assigns 'B2' Corp. Family Rating
----------------------------------------------------------
Moody's Investors Service assigned a B2 Corporate Family Rating
and a B2-PD Probability of Default Rating to Fotolia Holdings,
Inc.
Moody's also assigned Ba3 to the company's proposed $200 million
1st lien senior secured term loan and Caa1 to the proposed $100
million 2nd lien senior secured term loan. Proceeds from the new
debt instruments are expected to fund the refinancing of existing
debt, a $161 million special dividend, and transaction related
fees. The rating outlook is stable.
Assignments:
Issuer: Fotolia Holdings, Inc.
Corporate Family Rating: Assigned B2
Probability of Default Rating: Assigned B2-PD
New $200 million 1st Lien Senior Secured Term Loan: Assigned Ba3,
LGD3 -- 31%
New $100 million 2nd Lien Senior Secured Term Loan: Assigned Caa1,
LGD5 -- 85%
Outlook Actions:
Issuer: Fotolia Holdings, Inc.
Outlook is Stable
Ratings Rationale:
Fotolia's B2 corporate family rating reflects very high leverage
with pro forma debt-to-EBITDA of 6.6x (including Moody's standard
adjustments) estimated upon closing of the proposed dividend
transaction. Based on Moody's forecast, debt-to-EBITDA will
improve to less than 6.0x over the next 12 to 18 months driven by
low to mid-single digit percentage EBITDA growth and application
of free cash flow to reduce term loan B borrowings. Fotolia is a
leading provider of microstock imagery in German and France, and
has generated annual increases in revenues since its founding in
2005 supported by growing demand for imagery products used by
small businesses, publishers, and freelancers. Moody's expects
revenues to increase in the low to mid-single digit percentage
range over the next 12 months, despite economic weakness in Europe
(80% of FY2012 revenues). Expansion beyond existing markets will
require modest capital investment which should be funded from
excess cash. The company benefits from a highly variable cost
structure as well as reported EBITDA margins in excess of 45%.
Free cash flow conversion is strong reflecting favorable working
capital dynamics combined with nominal capital spending. Moody's
believes event risk is high based on the company's ownership by
financial sponsors, track record of distributions , and strategy
to expand in other countries. The company's ratings also consider
the increasing supply of lower priced digital imagery, as well as
potential threats from existing and new competitors or
technologies. Moody's believes barriers to entry are low in the
microstock segment, and there are risks related to increasing
competition. Fotolia has minimal product diversification away from
microstock photography, and revenues are concentrated in Europe.
Accordingly, Moody's believes it is important for the company to
reduce leverage to increase financial flexibility to make the
necessary investments in its products and services to retain its
leading positions in Europe, especially in a scenario of
increasing competition. Liquidity is expected to be good with cash
balances of a minimum $5 million to $10 million over the next 12
months plus at least mid-single digit percentage free cash flow-
to-debt ratios.
To the extent the company chooses to increases the 1st lien term
loan above $200 million with a corresponding decrease in the 2nd
lien term loan amount, there would likely be no change to the B2
CFR; however, the rating on the 1st lien term loan would likely be
downgraded to reflect a reduced cushion provided by the 2nd lien
term loan.
The stable rating outlook reflects Moody's expectation that
Fotolia will maintain its leadership positions in Germany and
France despite the potential for increased competition from
existing and new imagery providers in the microstock segment.
Moody's believes revenues will increase in the low to mid-single
digit percentage range over the next 12 months tracking
expectations for effectively flat GDP growth in Europe and low
single-digit GDP growth in the U.S. The outlook assumes free cash
flow will be applied to reduce term loan B borrowings and
incorporates Moody's view that debt-to-EBITDA will decrease below
initial levels providing more flexibility to invest in expansion
into new markets as well as some cushion for the next cyclical
downturn. The outlook does not incorporate sizable debt financed
distributions or acquisitions over the next 12 to 18 months.
Ratings could be downgraded if debt-to-EBITDA is sustained at or
above initial levels over the next 12 months or if heightened
competition or weak demand in one or more key markets results in
declining revenues or erosion in EBITDA margins. Beyond the next
12 months, another leveraging event, including sizable debt
financed dividends or share repurchases resulting in debt-to-
EBITDA ratios increasing above 6.0x (including Moody's standard
adjustments) could also lead to a downgrade. The company's track
record for distributions or recapitalizations weighs on ratings;
however, Moody's could consider an upgrade if the company
establishes a track record for adhering to operating and financial
policies that are consistent with a higher rating. Debt-to-EBITDA
leverage ratios would also need to be sustained below 4.5x with
free cash flow-to-debt ratios of a minimum 8% -9%.
The principal methodology used in this rating was Global Broadcast
and Advertising Related Industries published in May 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.
Headquartered in New York, NY, Fotolia Holdings, Inc. ("Fotolia")
is a provider of microstock photography with lead rankings in
Europe based on revenues. The company was founded in 2005 and
provides stock images primarily through its web site Fotolia.com.
In June 2012, KKR acquired a 47% stake (50% voting stake) in
Fotolia from TA Associates (31% remaining ownership) and Oleg
Tscheltzoff (Co-founder & CEO) in a transaction which valued the
company at $455 million. Revenues totaled $87 million for fiscal
year ending December 2012.
FOTOLIA HOLDINGS: S&P Assigns Preliminary 'B' Corp. Credit Rating
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned New York-based online
photography provider Fotolia Holdings Inc. its 'B' preliminary
corporate credit rating. The outlook is stable.
At the same time, S&P assigned the company's proposed $200 million
senior secured first-lien term loan due 2020 its preliminary
issue-level rating of 'B' (at the same level as the corporate
credit rating), with a preliminary recovery rating of '3',
indicating S&P's expectation for meaningful (50% to 70%) recovery
for first-lien lenders in the event of a payment default.
In addition, S&P assigned the company's proposed $100 million
senior secured second-lien term loan due 2021 its preliminary
issue-level rating of 'CCC+' (two notches below the corporate
credit rating), with a preliminary recovery rating of '6',
indicating S&P's expectation for negligible (0% to 10%) recovery
for second-lien lenders in the event of a payment default.
The company will use the proceeds to fund a dividend of about
$160 million and refinance the existing credit facility.
The 'B' preliminary corporate credit rating reflects the company's
narrow business focus, high profitability, and the financial risk
inherent in a leveraged recapitalization. S&P views Fotolia's
business risk profile as "weak," based on the company's small
scale and narrow business focus in the lower-end online
photography marketplace, and notwithstanding its high
profitability. S&P views the company's financial risk profile as
"highly leveraged," based on its high leverage of 6.9x, pro forma
as March 31, 2013. Pro forma interest coverage is 2.3x. S&P
views Fotolia's management and governance as "fair."
Fotolia is the leading online provider of microstock imagery in
Europe, where it generated 80% of 2012 revenue. The company is
the European market leader but trails iStockPhoto (owned by Getty
Images) and Shutterstock Inc. globally. Although Fotolia has
grown rapidly, the company operates on a limited scale and has a
narrow business focus. There is also the risk of a new competitor
entering this still evolving industry segment. Fotolia has grown
mainly through organic growth and international expansion.
The company offers customers the option to buy images using credit
or to buy a subscription product. The majority of revenue has
come from credit purchases, but the subscription segment has been
growing faster of late as the company introduced new subscription
options in late 2012. About 200,000 contributors supply the
images and are paid a commission each time their image is
downloaded. Over the past couple years, the company has been able
to meaningfully improve margins by increasing prices while
containing operating expense growth.
FUNCTIONAL TECHNOLOGIES: Largest Creditor Wants Lift Stay
---------------------------------------------------------
Functional Technologies Corp. on June 12 disclosed that its
largest creditor, Atlantic Canada Opportunities Agency, has set
down a court application for an immediate termination of the stay
of bankruptcy that would otherwise expire at midnight on June 12,
2013. The Company has been unable to obtain ACOA's approval to a
third party loan and therefore the Company has no funds with which
to base an application for a further extension of the creditor
protection period reported in the Company's news release of
April 25, 2013.
The Company also reports the resignation of its remaining
directors and officers.
The Trustee is:
Abakhan & Associates Inc.
625 Howe Street, Suite 1120
Vancouver, BC, V6C 2T6
Tel: 604-689-4255; 1-877-308-8877
Fax: 604-689-4277
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES
PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX
VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR
ACCURACY OF THIS RELEASE.
Contacts:
Abakhan & Associates Inc.
Rick Hamilton
604-484-7843
About Functional Technologies Corp.
Functional Technologies develops and commercializes proprietary,
advanced yeast-based solutions to significant challenges in the
food, beverage and healthcare industries. The Company's platform
improves the performance of innate yeast functions, and prevents
the formation of naturally occurring toxins and contaminants that
either affect final product quality or are classified by the World
Health Organization as probable human carcinogens. Functional
Technologies' lead technologies include yeasts that prevent and
reduce the formation of the foul-smelling hydrogen sulphide (H2S)
and the carcinogen acrylamide, both of which are natural occurring
by-products of food and beverage processing. These contaminants
are found in many commonly consumed items, such as fermented food
products and alcoholic beverages, and baked and fried foods.
The head office and R&D operations for Functional Technologies are
based in Vancouver, BC, Canada.
GORDIAN MEDICAL: Gets Extension of Ch. 11 Plan Deadline
-------------------------------------------------------
Marie Beaudette writing for Dow Jones' DBR Small Cap reports that
a bankruptcy judge has granted American Medical Technologies Inc.
an extension to file its Chapter 11 plan as the company works to
resolve key disputes with Medicare's administrators and the
Internal Revenue Service.
About Gordian Medical
Gordian Medical, Inc., dba American Medical Technologies, filed a
Chapter 11 petition (Bankr. C.D. Cal. Case No. 12-12339) in
Santa Ana, California, on Feb. 24, 2012, after Medicare refunds
were halted. Irvine, California-based Gordian Medical provides
supplies and services to treat serious wounds. The company has
active relationships with and serves patients in more than 4,000
nursing facilities in 49 states with the heaviest concentration of
the nursing homes being in the south and southeast sections of the
United States.
The Debtor estimated assets and debts of up to $50 million. It
has $4.3 million in cash and $31.1 million in receivables due from
Medicare.
Judge Mark S. Wallace oversees the case. Pachulski Stang Ziehl &
Jones LLP serves as the Debtor's counsel. GlassRatner Advisory &
Capital Group LLC serves as the Debtor's financial advisor.
The U.S. Trustee appointed five members to the Official Committee
of Unsecured Creditors. The Committee is represented by Landau
Gottfried & Berger LLP.
HANDY HARDWARE: TRC Master Fund Buys Leaktite Claims
----------------------------------------------------
TRC Master Fund LLC acquired two Leaktite Corporation claims
(Claim nos. 169 and 378) filed in the Chapter 11 case of Handy
Hardware Wholesale Inc., according to a May 17 notice filed in
Delaware bankruptcy court. Leaktite is a Leominster, Mass.-based
firm. Each of the claims asserts $89,384.
TCR may be reached at:
TCR Master Fund LLC
Terrel Ross, Managing Member
PO Box 633
Woodmere, NY 11598
Tel: 516-255-1801
About Handy Hardware
Handy Hardware Wholesale, Inc., filed a Chapter 11 petition
(Bankr. D. Del. Case No. 13-10060) on Jan. 11, 2013.
Handy Hardware is engaged in the business of buying goods from
vendors and selling those goods at a discounted price to its
members for sale in their retail stores. Handy Hardware, which
has 300 employees, is operating on a cooperative basis and is
completely member-owned, with over 1,000 members. The Debtor's
warehouse facilities are located in Houston, Texas, and in
Meridian, Mississippi. Trucking services are provided by Averitt
Express, Inc., and Trans Power Corp. Its members operate 1,300
retail stores, home centers, and lumber yards. The members are
located in 14 states throughout the U.S. as well as in Mexico,
South America, and Puerto Rico.
Bankruptcy Judge Mary F. Walrath oversees the case. Lawyers at
Ashby & Geddes, P.A., serve as the Debtor's counsel. MCA
Financial serves as financial advisor. Donlin Recano serves as
claims and noticing agent. The Debtor disclosed $79,169,106 in
assets and $77,605,085 plus an unknown in liabilities as of the
Chapter 11 filing.
A seven-member official committee of unsecured creditors has been
appointed in the case. Gellert Scali Busenkell & Brown, LLC
represents the Committee.
Wells Fargo is providing a $30 million revolving credit to finance
operations in Chapter 11.
In June 2013, Handy Hardware said it wants to sell itself to a
unit of private equity firm Littlejohn Management Holdings LLC in
a deal that would pay off all administrative claims and raise the
recoveries of unsecured creditors. Under Handy Hardware's amended
Chapter 11 plan, Littlejohn would also pay $4 million to cover
wind-down costs for the estate and to go toward paying unsecured
creditors on a pro-rated basis.
HERFF JONES: New $700MM Debt Facilities Get Moody's B2 Rating
-------------------------------------------------------------
Moody's Investors Service assigned a B2 Corporate Family Rating
and a B3-PD Probability of Default Rating to Herff Jones, Inc.
Concurrently, Moody's assigned B2 ratings to the company's
proposed $700 million in senior secured credit facilities,
comprised of a $150 million senior secured revolving credit
facility and a $550 million senior secured term loan. The ratings
outlook is stable.
On May 15, 2013, Herff Jones announced that it has agreed to
acquire BSN Sports, Inc. ("BSN") for an enterprise value of $460
million, or 9.6x trailing April 30, 2013 adjusted EBITDA of $48
million. Proceeds from the proposed credit facilities will be used
to finance the acquisition, refinance Herff Jones and BSN existing
indebtedness and pay related fees and expenses. The company will
also use proceeds from the proposed revolver to fund seasonal
working capital needs and ESOP share repurchase obligations.
The ratings are subject to completion of the transaction and
review of final documentation.
The following ratings were assigned to Herff Jones:
- Corporate Family Rating at B2;
- Probability-of-Default Rating at B3-PD;
- $150 million Senior Secured Revolver due 2018 at B2 (LGD 3,
33%);
- $550 million Senior Secured Term Loan due 2019 at B2 (LGD 3,
33%).
Ratings Rationale:
Herff Jones' B2 corporate family rating reflects the company's
high leverage associated with the acquisition of BSN, with pro
forma lease adjusted debt/EBITDA estimated to be around 4.75 times
for the trailing twelve month period ended April 30, 2013. Cash
demands are high given the interest burden associated with the
company's acquisitive growth (the transaction comes on the heels
of the 2011 acquisition of Varsity) and sizeable ESOP share
repurchase obligations, the latter of which are expected to be
around $150 million over the next three years. As a result, debt
reduction is expected to be modest over the near-to-intermediate
term. The rating also reflects the risks associated with the
relatively large acquisition, which increases revenue by nearly
50% to about $1.1 billion.
The rating acknowledges the strategic benefits of the transaction,
including the broadening of Herff Jones' product and brand
portfolio, as well as increasing Herff Jones' already credible
share within its market. The transaction may also create potential
top-line synergies and cost savings opportunities over time as the
company leverages its scale, and adds a growth platform to
supplement the flat-to-declining performance at Herff Jones'
legacy yearbook, scholastic and education segments. The combined
companies' historic operating performance reflects relatively
stable revenues with high customer retention rates and increased
participation in athletic and cheerleading activities, although
its legacy segments have shown some vulnerability to economic
cycles and school budget constraints. The rating also reflects the
expectation for good liquidity.
The B2 ratings assigned to Herff Jones' secured credit facilities
reflect the company's overall probability of default, to which
Moody's assigns a B3-PD, and a loss given default assessment of
LGD 3 (33%). The facilities are secured by a first lien in
substantially all tangible and intangible assets and all of the
equity interests of Herff Jones and its subsidiary guarantors.
Moody's assumes a higher than average recovery for the debt
instruments given the transaction's all first lien structure with
an overall assessment of 65% and, as a consequence, the
Probability of Default rating is one notch lower than the
Corporate Family Rating.
The rating outlook is stable given Moody's expectations that the
company will successfully integrate BSN, that the combined company
will generate sufficient cash flow to fund its sizable cash
obligations projected over the next several years, and pay down
debt with excess cash.
Over time, ratings could be upgraded if the company successfully
integrates BSN, and sustainably reduces debt and leverage through
both profitable growth and debt reduction. Specific metrics
include debt to EBITDA sustained below 4.0 times.
Ratings could be downgraded if operating performance deteriorates,
either through weak industry conditions or difficulty integrating
the acquisition. Difficulty managing the sizeable incentive
obligations could also pressure the rating. Specific metrics
include interest coverage sustained below 2.5 times or leverage
above 5.0 times.
The principal methodology used in rating Herff Jones was the
Global Consumer Durables Industry 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.
Herff Jones, Inc. is a manufacturer and publisher of recognition
rewards, graduation-related items and cheerleading products and
services throughout the U.S. BSN is a direct distributor of team
sports apparel and equipment to U.S. institutional markets and
team dealers. Following the acquisition the combined company will
have approximately $1.1 billion in revenue for the trailing twelve
months ended April 30, 2013.
HI-WAY EQUIPMENT: Gets Final OK to Incur Postpetition Financing
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas
authorized, on a final basis, Hi-Way Equipment Company LLC, et
al., to:
-- obtain senior secured, super-priority credit facility from
CNH Capital America LLC, the DIP Lender;
-- use cash collateral;
-- grant liens and provide superpriority administrative expense
status, pursuant to a joint stipulation and agreed final
order.
As of the Petition Date, the outstanding amount owed by the Debtor
to:
a) Prepetition Lender under the Prepetition Credit Documents
consisted of principal indebtedness of not less than
$30,028,901, accrued interest of not less than $136,183, and
fees and expenses incurred or accrued by the Prepetition
Lender; and
b) G.E. Capital under the G.E. Capital Agreements consisted of
principal indebtedness of $3,704,307, accrued interest of
not less than $32,766 and fees and expenses incurred or
accrued by G.E. Capital.
The Debtors would use the cash collateral to continue operations
and to administer and preserve the value of their estates. The
Debtors relate that no credit was available on more favorable term
as that offered by the DIP lender.
As a condition to entry into the DIP Credit Agreement, the
extensions of credit under the DIP Facility and the authorization
to use cash collateral, the DIP Lender requires, and the Debtors
have agreed, that proceeds of the DIP Facility will be solely used
for working capital and general corporate purposes in the ordinary
course of business, and to pay the costs and expenses related to
the administration of the cases, subject to permitted variances.
As adequate protection from any diminution in value of the
lender's collateral, the Debtor will (i) grant replacement liens
on the Prepetition Collateral in the same priority as existed
prior to the Petition Date, (ii) make adequate protection payments
due to the Debtors' use of rental equipment covered by the
Prepetition Liens in the amount of 60 percent of the rental
payments actually received by the Debtors related to the rental
equipment covered by the Prepetition Liens.
As adequate protection for the Debtors' use of cash collateral,
the Debtors will grant replacement liens, subject to carve out on
certain expenses.
Any property owned by Wirtgen America, Inc., consigned to the
Debtor prior to the Petition Date, is not affected by the order or
stipulation.
All objections to the DIP Motion and the proposed financing to the
extent not withdrawn or resolved were overruled on the merits.
The U.S. Trustee has objected, in part, to the Debtor's emergency
motion for use of cash collateral because, among other things:
1. CNH Capital America LLC, the DIP Lender, is taking a lien in
Chapter 5 avoidance actions;
2. while the proposed financing order may define the DIP
Lender's superpriority and administrative status for
purposes of the case; and
3. the Court must require a proof of claim for the prepetition
amounts and must not constrain the filing of a proof of
claim in a subsequent case.
About Hi-Way Equipment Company
Hi-Way Equipment Company LLC filed a Chapter 11 petition (Bankr.
N.D. Tex. Case No. 13-41498) on April 1, 2013. Charles W. Reeves,
Jr., signed the petition as chief restructuring officer.
Gardere Wynne Sewell, LLP, serves as the Debtor's counsel. The
Debtor estimated assets and debts of at least $10 million.
Hi-Way Equipment has been providing rental and sales of equipment
since 1948. In 2008, Hi-Way Equipment acquired Equipment Support
Services, Inc. As part of that acquisition, Hi-Way Equipment
expanded to become a dealer of Case and Case IH equipment through
CNH America LLC. With the acquisition of ESS, Hi-Way Equipment
acquired ESS' subsidiaries: CDI Equipment, Ltd., Carruth-Doggett
Industries Partners Acquisition, LLC, Future Equipment Holdings,
LLC, Future Equipment Partners, LLC, Equipment Support Services,
Inc., ESS Acquisition LLC, Carruth-Doggett Industries Holdings
Acquisition, LLC and Southern Power Acquisition, Inc. In 2011,
Hi-Way Equipment merged with the Subsidiaries and Hi-Way Equipment
was the sole surviving entity. Hi-Way Equipment serves as the non-
exclusive dealer of Case and Case IH equipment in numerous
counties across Texas.
HOME LOAN: Moody's Assigns Ba3 Rating to New $350MM Term Loan
-------------------------------------------------------------
Moody's Investors Service assigned a first-time Ba3 corporate
family rating to Home Loan Servicing Solutions, Ltd. (HLSS) and a
Ba3 rating to the company's planned $350 million senior secured
term loan. The outlook is stable.
Ratings Rationale:
HLSS's rating reflects the company's solid capital and modest
leverage metrics. The ratings are constrained by the company's
potential liquidity risks particularly in an environment of rising
delinquencies, reliance on Ocwen Financial Corp. (Ocwen; B1 CFR,
stable) and limited operating history.
The company recently announced its intention to obtain a $350
million senior secured term loan facility, which along with an
additional equity raise of approximately $300 million is expected
to be used to acquire additional mortgage servicing assets from
Ocwen.
The stable outlook reflects Moody's expectation that HLSS will
maintain its existing financial performance, low level of
financial leverage and current liquidity profile.
Given the company's limited operating history, an upgrade is
unlikely at this time.
Negative ratings pressure could result if the company's financial
fundamentals weaken. Particular focus will be on: a) adequate
funding availability b) financial leverage, and c) Ocwen's
servicing performance.
The principal methodology used in this rating was Finance Company
Global Rating Methodology published in March 2012. In addition to
the primary methodology, Moody's cross sector rating methodology
Moody's Approach to Rating Banks and Finance Companies with
Limited Financial History published in August 2009 was also
considered for guidance.
HLSS is an independent acquirer of mortgage servicing assets
headquartered in the Cayman Islands.
IN THE PLAY: Court Enters Order for Relief
------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Pennsylvania
on May 10, 2013, entered an order for relief placing In the Play,
Inc. under bankruptcy protection. In a separate ruling, the Court
directed the Debtor file its (i) schedules of assets and
liabilities; (ii) statement of financial affairs; (iii) list of
equity security holders; and list of 20 largest unsecured
creditors by June 7, 2013.
About In The Play
Three alleged creditors filed an involuntary Chapter 11 petition
for Lansdale, Pennsylvania-based In The Play, Inc., (Bankr. E.D.
Pa. Case No. 13-11666) in Philadelphia on Feb. 27, 2013. The
petitioners are Richard Strauss (with $479,443 in claims), JAAZ,
LLC ($409,166) and Andrew Michelin ($157,522). Garabed Kendikian,
Esq., at the Law Offices of Charles Kendikian, LLC, serves as
counsel to the petitioners.
INTERFAITH MEDICAL: Wants Further Extension of Plan Filing Date
---------------------------------------------------------------
Interfaith Medical Center, Inc., is asking the U.S. Bankruptcy
Court for the Eastern District of New York to further extend until
Sept. 30, 2013, the time within which it has exclusive right to
file a plan of reorganization and until Dec. 2, 2013, the time
within which it has exclusive right to solicit acceptances of that
plan.
According to the Debtor, the additional time will be used to
ensure that it has an opportunity to address all stakeholders'
concerns. The Debtor says its commitment to working with its
creditors is underscored by the finalization of the memorandum of
understanding with the Dormitory Authority of the State of New
York and multiple New York State entities and regulatory
authorities, active unions, and pension funds. The Debtor needs
the time to finalize the MOUs.
A hearing on the request will be held on June 21, 2013, at 11:00
a.m. (Eastern Time). Objections are due June 14.
The motion was filed by Alan J. Lipkin, Esq., Shaunna D. Jones,
Esq., and Jack M. Tracy II, Esq., at Willie Farr & Gallagher LLP,
in New York, on behalf of the Debtor.
About Interfaith Medical Center
Headquartered in Brooklyn, New York, Interfaith Medical Center,
Inc., operates a 287-bed hospital on Atlantic Avenue in Bedford-
Stuyvesant and an ambulatory care network of eight clinics in
central Brooklyn, in Crown Heights and Bedford-Stuyvesant.
The Company filed for Chapter 11 protection (Bankruptcy E.D. N.Y.
Case No. 12-48226) on Dec. 2, 2012. The Debtor disclosed
$111,872,972 in assets and $193,540,998 in liabilities as of the
Chapter 11 filing.
Alan J. Lipkin, Esq., at Willkie Farr & Gallagher LLP, serves as
bankruptcy counsel to the Debtor. Nixon Peabody LLP is the
special corporate and healthcare counsel. CohnReznick LLP serves
as financial advisor. Donlin, Recano & Company, Inc. serves as
administrative agent.
The Official Committee of Unsecured Creditors tapped Alston & Bird
LLP as its counsel, and CBIZ Accounting, Tax & Advisory of New
York, LLC as its financial advisor.
Eric M. Huebscher, the patient care ombudsman tapped the law firm
of DiConza Traurig LLP, as his counsel.
INTROCAR INC: Motorcar Parts Units File for Chapter 7
-----------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Motorcar Parts of America Inc. allowed newly acquired
subsidiaries Introcar Inc. and Fenwick Automotive Products Ltd. to
file petitions for Chapter 7 liquidation (Bankr. D. Del. Case No.
13-bk-11499 and 13-bk-11500) on June 10.
According to the report, Fenwick, based in Toronto, and Introcar,
based in Torrance, California, both claimed their assets are less
than $10 million, with debt exceeding $100 million.
The parent MPA said in a statement that both subsidiaries are
separately capitalized. Fenwick was acquired in May 2011 in a $5
million transaction, according to data compiled by Bloomberg. MPA
said the subsidiaries had been unable to achieve cost savings
sufficient to justify continuing the involvement with the
companies.
The Bloomberg news reports that Torrance-based MPA reported net
income of $935,000 for the quarter ended December 31 on revenue of
$116.3 million. For the fiscal year ended Sept. 28, 2011, there
was a $48.5 million net loss on revenue of $363.7 million. The
operating loss in the year was $27.5 million.
JEFFERSON COUNTY: Sewer Bondholders Seek to Halt Appeal
-------------------------------------------------------
Katy Stech writing for Dow Jones' DBR Small Cap reports that
Jefferson County, Ala., officials and municipal bondholders want
to halt their dispute over how the county's sewer system should be
managed during the county's bankruptcy case -- a dispute that was
scheduled to unfold before a panel of appeals judges but will die
under a recent debt-cutting deal.
About Jefferson County
Jefferson County has its seat in Birmingham, Alabama. It has a
population of 660,000.
Jefferson County filed a bankruptcy petition under Chapter 9
(Bankr. N.D. Ala. Case No. 11-05736) on Nov. 9, 2011, after an
agreement among elected officials and investors to refinance
$3.1 billion in sewer bonds fell apart.
John S. Young Jr. LLC was appointed as receiver by Alabama Circuit
Court Judge Albert Johnson in September 2010.
Jefferson County's bankruptcy represents the largest municipal
debt adjustment of all time. The county said that long-term debt
is $4.23 billion, including about $3.1 billion in defaulted sewer
bonds where the debt holders can look only to the sewer system for
payment.
The county said it would use the bankruptcy court to put a value
on the sewer system, in the process fixing the amount bondholders
should be paid through Chapter 9.
Judge Thomas B. Bennett presides over the Chapter 9 case. Lawyers
at Bradley ArantBoult Cummings LLP and Klee, Tuchin, Bogdanoff&
Stern LLP, led by Kenneth Klee, represent the Debtor as counsel.
Kurtzman Carson Consultants LLC serves as claims and noticing
agent. Jefferson estimated more than $1 billion in assets. The
petition was signed by David Carrington, president.
The bankruptcy judge in January 2012 ruled that the state court-
appointed receiver for the sewer system largely lost control as a
result of the bankruptcy. Before deciding whether Jefferson County
is eligible for Chapter 9, the bankruptcy judge will allow the
Alabama Supreme Court to decide whether sewer warrants are the
equivalent of "funding or refunding bonds" required under state
law before a municipality can be in bankruptcy.
U.S. District Judge Thomas B. Bennett ruled in March 2012 that
Jefferson County is eligible under state law to pursue a debt
restructuring under Chapter 9. Holders of more than $3 billion in
defaulted sewer debt had challenged the county's right to be in
Chapter 9.
JERRY'S NUGGET: Critical Hearing on June 26
-------------------------------------------
The U.S. Bankruptcy Court for the District of Nevada will convene
a hearing on June 26, 2013, at 9:30 a.m., to consider the adequacy
of the Disclosure Statement explaining the Plan of Reorganization
proposed by Jerry's Nugget, Inc., and Spartan Gaming LLC.
According to the Disclosure Statement, the Debtors' Plan generally
provides for the repayment of claims against the Debtors as: (i)
Allowed Secured Claims will be paid in full with interest; (ii)
Allowed Priority Claims will be paid in full with interests; (iii)
Allowed Administrative Convenience Claims will be paid in full;
and (iv) Allowed General Unsecured Claims will be paid their Pro
Rata portion of $2,500,000, which will be funded by Debtors'
ongoing operations and the $400,000 or greater contribution
from the Stamis Trusts. Existing Equity Securities in JNI and
Spartan Gaming will be canceled and 100 percent of the Reorganized
Debtors' stock and membership issued to the Stamis Trusts.
On the substantial consummation date, the Stamis Trusts will
contribute $400,000, which money will be used by Reorganized
Debtors to fund the distributions required under the Plan. Upon
the written request of Reorganized Debtors after the substantial
consummation date, the Stamis Trusts will additionally contribute
others funds as are necessary for Reorganized Debtors to timely
tender the distributions contemplated by the Plan.
A copy of the Disclosure Statement is available for free at
http://bankrupt.com/misc/JERRYS_NUGGET_ds.pdf
The Bankruptcy Court also will convene a hearing on June 26 at
9:30 a.m., to consider creditor U.S. Bank National Association's
motion to limit the Debtors' exclusivity period.
U.S. Bank wants the Court terminate the Debtors' exclusive
periods. The bank said in Court papers filed last month that it
would be impossible for the Debtors to obtain acceptance of a plan
prior to the June 10 expiration of their exclusivity period.
U.S. Bank also stated that the Debtors have been dilatory in
seeking plan confirmation and the Debtors are mismanaged. U.S.
Bank stressed that terminating the Debtors' exclusivity period
will not prevent the Debtors from seeking confirmation of their
own plan.
About Jerry's Nugget and Spartan Gaming
Jerry's Nugget Inc., operates Jerry's Nugget, a casino consisting
of approximately 87,187 square feet of building area and 24,511
square fee of casino floor space with approximately 630 slot and
video poker machines and 9 table games. Jerry's Nugget also
contains a sports book, a keno area and a small live pit.
Jerry's Nugget Inc. and affiliate Spartan Gaming LLC sought
Chapter 11 protection (Bankr. D. Nev. Lead Case No. 12-19387) in
Las Vegas, Vegas, on Aug. 13, 2012. Jerry's Nugget, owned by the
Stamis family, has a 9.1-acre casino property in North Las Vegas.
The property consists of 87,187 square feet of building area and
24,511 square feet of casino floor space, with 630 slot and video
poker machines and 9 table games. Jerry's Nugget also contains a
sports book, a keno area, and a small live pit. There are two
restaurants the Uncle Angelo's Pizza Joint and Jerry's Famous
Coffee shop as well as Uncle Angelo's Bakery, a locals' favorite.
Net revenues totaled $22.5 million, including $15.3 million in
gaming revenue, in the year ended Dec. 31, 2011. Spartan Gaming
owns 12 parcels of real property in Nevada. Two of the parcels
provide parking access for Jerry's Nugget.
Judge Mike K. Nakagawa presides over the case. Lawyers at Gordon
Silver, in Las Vegas, serve as the Debtors' counsel. Jerry's
Nugget estimated assets and debts of $10 million to $50 million.
Jerry's Nugget said its current going concern value is at least $8
million. Spartan Gaming estimated $1 million to $10 million in
assets and debts. The petitions were signed by Jeremy Stamis,
president.
In its schedules, Jerry's Nugget disclosed $12,378,944 in assets
and $10,771,442 in liabilities as of the Petition Date.
JERRY'S NUGGET: Lever Capital Approved as Financing Broker
----------------------------------------------------------
The Bankruptcy Court authorized Jerry's Nugget, Inc., and Spartan
Gaming LLC to employ Lever Capital Partners LLC as financing
broker.
As reported by the Troubled Company Reporter on April 22, 2013,
Lever Capital will assist the Debtors in obtaining new financing
for the Debtors' roughly 9.1-acre property located at 1821 North
Las Vegas Boulevard, North Las Vegas, Nevada. The Debtor engaged
Lever Capital solely as its financing broker to canvass the
financial markets in an effort to secure new financing for the
Casino Property.
Adam Horowitz, Lever Capital's principal, has over 15 years of
experience in the real estate financing industry. Mr. Horowitz
has experience solving complex real estate transactions and has
secured various forms of financing, including debt, mezzanine, and
equity, for numerous real estate owners and developers. Mr.
Howoritz has a Masters of Science from Stevens Institute of
Technology and a Bachelor of Science from the University of South
Florida. Lever Capital is thus well-qualified and uniquely suited
to serve as Debtor's financing broker.
Lever Capital has agreed to provide the Debtor financing brokerage
services on a commission basis. That is, upon receiving a loan
commitment, Lever Capital will have earned as compensation a
commission fee equal to 1.5 percent of the loan commitment amount.
The Commission will be payable in full only at the closing of the
new financing for the Casino Property. However, should the Court
not approve the new loan (by denying confirmation of the Debtor's
Plan, denying a motion to obtain postpetition financing pursuant
to Section 364, or otherwise), no Commission will be due.
The Debtor assures the Court neither Lever Capital nor its
employees hold or represent and have not held or represented any
interest adverse to the Debtor's estate nor have any connection to
Debtor, its creditors, or any related parties.
The firm may be reached at:
Adam Horowitz
LEVER CAPITAL PARTNERS LLC
375 Park Avenue, Suite 2607
New York, NY 10152
Tel: 212-493-5400
E-mail: ahorowitz@levercp.com
About Jerry's Nugget and Spartan Gaming
Jerry's Nugget Inc., operates Jerry's Nugget, a casino consisting
of approximately 87,187 square feet of building area and 24,511
square fee of casino floor space with approximately 630 slot and
video poker machines and 9 table games. Jerry's Nugget also
contains a sports book, a keno area and a small live pit.
Jerry's Nugget Inc. and affiliate Spartan Gaming LLC sought
Chapter 11 protection (Bankr. D. Nev. Lead Case No. 12-19387) in
Las Vegas, Vegas, on Aug. 13, 2012. Jerry's Nugget, owned by the
Stamis family, has a 9.1-acre casino property in North Las Vegas.
The property consists of 87,187 square feet of building area and
24,511 square feet of casino floor space, with 630 slot and video
poker machines and 9 table games. Jerry's Nugget also contains a
sports book, a keno area, and a small live pit. There are two
restaurants the Uncle Angelo's Pizza Joint and Jerry's Famous
Coffee shop as well as Uncle Angelo's Bakery, a locals' favorite.
Net revenues totaled $22.5 million, including $15.3 million in
gaming revenue, in the year ended Dec. 31, 2011. Spartan Gaming
owns 12 parcels of real property in Nevada. Two of the parcels
provide parking access for Jerry's Nugget.
Judge Mike K. Nakagawa presides over the case. Lawyers at Gordon
Silver, in Las Vegas, serve as the Debtors' counsel. Jerry's
Nugget estimated assets and debts of $10 million to $50 million.
Jerry's Nugget said its current going concern value is at least $8
million. Spartan Gaming estimated $1 million to $10 million in
assets and debts. The petitions were signed by Jeremy Stamis,
president.
In its schedules, Jerry's Nugget disclosed $12,378,944 in assets
and $10,771,442 in liabilities as of the Petition Date.
JERRY'S NUGGET: Fair Harbor Buys Tripp Plastics Claim
-----------------------------------------------------
Tripp Plastics assigned its Claim No. 14 against Jerry's Nugget
Inc., to Fair Harbor Capital, LLC, for an undisclosed amount,
according to an April 29 notice filed in bankruptcy court.
Another claims trader, The Seaport Group LLC, is also buying
claims filed in the case.
Jerry's Nugget Inc., operates Jerry's Nugget, a casino consisting
of approximately 87,187 square feet of building area and 24,511
square fee of casino floor space with approximately 630 slot and
video poker machines and 9 table games. Jerry's Nugget also
contains a sports book, a keno area and a small live pit.
Jerry's Nugget Inc. and affiliate Spartan Gaming LLC sought
Chapter 11 protection (Bankr. D. Nev. Lead Case No. 12-19387) in
Las Vegas, Vegas, on Aug. 13, 2012. Jerry's Nugget, owned by the
Stamis family, has a 9.1-acre casino property in North Las Vegas.
The property consists of 87,187 square feet of building area and
24,511 square feet of casino floor space, with 630 slot and video
poker machines and 9 table games. Jerry's Nugget also contains a
sports book, a keno area, and a small live pit. There are two
restaurants the Uncle Angelo's Pizza Joint and Jerry's Famous
Coffee shop as well as Uncle Angelo's Bakery, a locals' favorite.
Net revenues totaled $22.5 million, including $15.3 million in
gaming revenue, in the year ended Dec. 31, 2011. Spartan Gaming
owns 12 parcels of real property in Nevada. Two of the parcels
provide parking access for Jerry's Nugget.
Judge Mike K. Nakagawa presides over the case. Lawyers at Gordon
Silver, in Las Vegas, serve as the Debtors' counsel. Jerry's
Nugget estimated assets and debts of $10 million to $50 million.
Jerry's Nugget said its current going concern value is at least $8
million. Spartan Gaming estimated $1 million to $10 million in
assets and debts. The petitions were signed by Jeremy Stamis,
president.
In its schedules, the Debtors disclosed $12,378,944 in assets and
$10,771,442 in liabilities as of the Petition Date.
JOURNAL REGISTER: Seeks More Time to File Liquidation Plan
----------------------------------------------------------
Journal Register Company, f/k/a Pulp Finish 1 Company, and its
debtor affiliates ask the U.S. Bankruptcy Court for the Southern
District of New York to further extend until Sept. 30, 2013, the
time within which they have exclusive right to propose a plan of
reorganization and until Nov. 29, 2013, the time within which they
have exclusive right to solicit acceptances of that plan.
With the additional time, the Debtors hope to bring their Chapter
11 cases to a conclusion through the wind down of their estates
and file a plan of liquidation and accompanying disclosure
statement. The Debtors relate that they are in the process of
negotiating the terms of a plan and disclosure statement at this
time and anticipate filing the documents in the near term.
A hearing on the motion will be held on June 25, 2013, at 10:00
a.m. (prevailing Eastern Time). Objections are due June 20.
Neil E. Herman, Esq., James L. Garrity, Jr., Esq., and Patrick D.
Fleming, Esq., at Morgan, Lewis & Bockius LLP, in New York, and
Michael R. Nestor, Esq., Kenneth J. Enos, Esq., and Andrew L.
Magaziner, Esq., at Young Conaway Stargatt & Taylor, LLP, in New
York, filed the motion on behalf of the Debtors.
About Journal Register
Journal Register Company -- http://www.JournalRegister.com/-- is
the publisher of the New Haven Register and other papers in 10
states, including Philadelphia, Detroit and Cleveland, and in
upstate New York. JRC is managed by Digital First Media and is
affiliated with MediaNews Group, Inc., the nation's second largest
newspaper company as measured by circulation.
Journal Register, along with its affiliates, first filed for
Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No.
09-10769) on Feb. 21, 2009. Attorneys at Willkie Farr & Gallagher
LLP, served as counsel to the Debtors. Attorneys at Otterbourg,
Steindler, Houston & Rosen, P.C., represented the official
committee of unsecured creditors. Journal Register emerged from
Chapter 11 protection under the terms of a pre-negotiated plan.
Journal Register returned to bankruptcy (Bankr. S.D.N.Y. Lead Case
No. 12-13774) on Sept. 5, 2012, to sell the business to 21st CMH
Acquisition Co., an affiliate of funds managed by Alden Global
Capital LLC. The deal is subject to higher and better offers.
Journal Register exited the 2009 restructuring with $225 million
in debt and with a legacy cost structure, which includes leases,
defined benefit pensions and other liabilities that have become
unsustainable and threatened the Company's efforts for a
successful digital transformation. Journal Register managed to
reduce the debt by 28% with the Company servicing in excess of
$160 million of debt.
Alden Global is the holder of two terms loans totaling $152.3
million. Alden Global acquired the stock and the term loans from
lenders in Journal Register's prior bankruptcy.
Journal Register disclosed total assets of $235 million and
liabilities totaling $268.6 million as of July 29, 2012. This
includes $13.2 million owing on a revolving credit to Wells Fargo
Bank NA.
Bankruptcy Judge Stuart M. Bernstein presides over the 2012 case.
Neil E. Herman, Esq., Rachel Jaffe Mauceri, Esq., and Patrick D.
Fleming, Esq., at Morgan, Lewis & Bockius, LLP; and Michael R.
Nestor, Esq., Kenneth J. Enos, Esq., and Andrew L. Magaziner,
Esq., at Young Conaway Stargatt & Taylor LLP, serve as the 2012
Debtors' counsel. SSG Capital Advisors, LLC, serves as financial
advisors. American Legal Claims Services LLC acts as claims
agent. The petition was signed by William Higginson, executive
vice president of operations.
Otterbourg, Steindler, Houston & Rosen, P.C., represents Wells
Fargo. Akin, Gump, Strauss, Hauer & Feld LLP, represents the
Debtors' Tranche A Lenders and Tranche B Lenders. Emmet, Marvin &
Martin LLP, serves as counsel to Wells Fargo, in its capacity as
Tranche A Agent and the Tranche B Agent.
The Official Committee of Unsecured Creditors appointed in the
case has retained Lowenstein Sandler PC as counsel and FTI
Consulting, Inc. as financial advisor.
KIT DIGITAL: Creditors' Committee Objects to Disclosure Statement
-----------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in the
Chapter 11 cases of KIT Digital, Inc., objects to the disclosure
statement explaining the Debtor's Plan complaining that the
disclosures failed to provide critical information to general
unsecured creditors regarding the factors that could negatively
impact their recoveries under the Plan and provides insufficient
information to enable those creditors to make an informed judgment
regarding the Plan, in contravention of Section 1125 of the
Bankruptcy Code.
In the Disclosure Statement, the Debtor estimates that the
?Available Cash? provided under the Plan to satisfy creditor
claims will be sufficient to pay holders of allowed general
unsecured claims in full. However, the Creditors' Committee
complains, the Debtor fails to inform creditors that its
projection is entirely dependent on the the Debtor's ability to
(i) significantly reduce the anticipated pool of unsecured claims;
(ii) classify litigation claims separately from other unsecured
claims and subject those claims to a lesser treatment; (iii)
subordinate and disallow certain litigation claims that are not
identified or discussed in the Disclosure Statement, including a
$13.8 million claim asserted by InVigor Group Limited and an $8.35
million claim breach of contract and tort claim filed by Kaleil
Isaza Tuzman, the Debtor's former CEO, and (iv) curtail the
administrative expenses associated with these efforts.
The Debtor's Disclosure Statement ignores the fact that, should
certain unstated assumptions underlying their estimates not come
to pass, there is a risk that general unsecured creditors could
ultimately receive less than a 40% return under the Plan, the
Committee notes.
Summary of Plan
The Debtors' Plan revolves around a plan support agreement, dated
April 16, 2013, with three of their largest equity holders, JEC
Capital Partners, LLC, Prescott Group Capital Management L.L.C.,
and Stitching Bewaarder Ratio Capital Partners, to support and
fund the Debtor's reorganization. Pursuant to the Plan Support
Agreement, the Plan Sponsor Group agreed to purchase 89.29% of the
common stock of Reorganized KDI for $25 million. The purchase
price paid by the Plan Sponsor Group will be used by the Debtor to
fund distributions under the Plan.
Under the Plan, Holders of Allowed General Unsecured Claims will
receive their Pro Rata Share of Available Cash, including the
Purchase Price to be paid by the Plan Sponsor Group. The Debtor
anticipates that it will have sufficient cash to pay Allowed
General Unsecured Claims in full and, accordingly, projects
estimated recoveries to Class 4 (General Unsecured Claims) to be
100%. The Debtor's ability to pay General Unsecured Claims in
full, however, is contingent on there being sufficient Available
Cash, the outcome of the Debtor's claims resolution process, and
the subordination of certain Claims for purposes of distribution,
such as the Invigor Claims. Anticipated distributions to Allowed
General Unsecured Claims may change once the Debtor has an
opportunity to review filed Claims, and anticipated recoveries are
qualified in their entirety by reference to the provisions of the
Plan.
The Debtor's Plan also provides an opportunity for current KDI
shareholders to participate in the reorganization of the Debtor.
Specifically, current shareholders will receive Reorganized KDI
Warrants exercisable at $0.205 per warrant, for shares of Class A2
common stock of Reorganized KDI. Proceeds from the exercise of
Reorganized KDI Warrants will be used to redeem up to fifty
percent (50%) of the stock issued to the Plan Sponsor Group under
the Plan. The remaining Reorganized KDI Class A Common Stock will
be issued to the DIP Facility Lender. In addition, Litigation
Warrants may be issued on the same terms and at the same exercise
price as the Reorganized KDI Warrants to any unpaid Allowed
Subordinated Claims, which, if exercised, will dilute the then
outstanding Reorganized KDI Class A2 Common Stock.
A full-text copy of the First Amended Disclosure Statement, dated
June 7, 2013, is available for free at:
http://bankrupt.com/misc/KITDIGITALds0607.pdf
Cathy Hershcopf, Esq., Jeffrey L. Cohen, Esq., and Michael A.
Klein, Esq., at Cooley LLP, in New York, for the Creditors'
Committee.
Jennifer Feldsher, Esq., and Anna Rozin, Esq., at Bracewell &
Giuliani LLP, in New York, for the Debtors.
About KIT digital
New York-based KIT digital Inc. -- http://www.kitd.com/-- is a
video management software and services company. KIT digital
services nearly 2,500 clients in 50+ countries including some of
the world's biggest brands, such as Airbus, The Associated Press,
AT&T, BBC, BSkyB, Disney-ABC, Google, HP, MTV, News Corp, Sky
Deutschland, Sky Italia, Telecom Argentina, Telecom Italia,
Telefonica, Universal Studios, Verizon, Vodafone VRT and
Volkswagen.
KIT digital filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case
No. 13-11298) in Manhattan on April 25, 2013. The Debtor
disclosed $310,206,684 in assets and $23,011,940 in liabilities.
KIT's operating subsidiaries, including Ioko 365, Polymedia,
Kewego, Multicast and Megahertz are not included in the Chapter 11
filing.
Jennifer Feldsher, Esq., and Anna Rozin, Esq., at Bracewell &
Giuliani LLP, in New York, serve as counsel to the Debtor.
American Legal Claims Services LLC is the claims and noticing
agent and the administrative agent.
Under the Plan, General Unsecured Claims will be paid in full from
available cash.
KIT DIGITAL: Equity Committee Taps Brown Rudnick as Counsel
-----------------------------------------------------------
The Official Committee of Equity Security Holders appointed in the
Chapter 11 case of KIT digital, Inc., seeks authority from the
U.S. Bankruptcy Court for the Southern District of New York to
retain Brown Rudnick LLP, as lead bankruptcy counsel.
As lead bankruptcy counsel, Brown Rudnick will, among other
things, assist and advise the Equity Committee in its discussions
with the Debtor and other parties-in-interest and represent the
Equity Committee before the Court.
Brown Rudnick will be paid $320 to $1,100 per hour for attorneys
and $265 to $370 per hour for paraprofessionals; and will be
reimbursed for any necessary out-of-pocket expenses incurred. The
lead professionals expected to provide services to the Equity
Committee are William R. Baldiga, Esq. (to be paid $1,045 per
hour), Bennett S. Silverberg, Esq. (to be paid $775 per hour), and
Arkady A. Goldinstein, Esq. (to be paid $430 per hour).
Mr. Baldiga assures the Court that his firm is a "disinterested
person" as the term is defined in Section 101(14) of the
Bankruptcy Code and does not represent any interest adverse to the
Equity Committee's.
Brown Rudnick LLP may be reached at:
William R. Baldiga, Esq.
Bennett S. Silverberg, Esq.
Arkady A. Goldinstein, Esq.
BROWN RUDNICK LLP
Seven Times Square
New York, NY 10036
Tel: (212) 209-4800
Fax: (212) 209-4801
E-mail: wbaldiga@brownrudnick.com
bsilverberg@brownrudnick.com
agoldinstein@brownrudnick.com
The retention applications will be presented in Court for approval
on June 24, 2013, at 12:00 noon (prevailing Eastern Time).
Objections are due June 17.
About KIT digital
New York-based KIT digital Inc. -- http://www.kitd.com/-- is a
video management software and services company. KIT digital
services nearly 2,500 clients in 50+ countries including some of
the world's biggest brands, such as Airbus, The Associated Press,
AT&T, BBC, BSkyB, Disney-ABC, Google, HP, MTV, News Corp, Sky
Deutschland, Sky Italia, Telecom Argentina, Telecom Italia,
Telefonica, Universal Studios, Verizon, Vodafone VRT and
Volkswagen.
KIT digital filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case
No. 13-11298) in Manhattan on April 25, 2013. The Debtor
disclosed $310,206,684 in assets and $23,011,940 in liabilities.
KIT's operating subsidiaries, including Ioko 365, Polymedia,
Kewego, Multicast and Megahertz are not included in the Chapter 11
filing.
Jennifer Feldsher, Esq., and Anna Rozin, Esq., at Bracewell &
Giuliani LLP, in New York, serve as counsel to the Debtor.
American Legal Claims Services LLC is the claims and noticing
agent and the administrative agent.
Under the Plan, General Unsecured Claims will be paid in full from
available cash.
KIT DIGITAL: Creditors' Committee Retains Cooley LLP as Counsel
---------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in the
Chapter 11 case of KIT digital, Inc., seeks authority from the
U.S. Bankruptcy Court for the Southern District of New York to
retain Cooley LLP as its lead bankruptcy counsel.
The firm, as lead bankruptcy counsel, will, among other things,
attend meetings on behalf of the Creditors' Committee, review
financial information furnished by the Debtors, negotiate the
budget and the use of cash collateral and DIP financing, and
review and investigate the liens of purportedly secured parties.
The following Cooley professionals are expected to provide
services to the Creditors' Committee:
Professional Status Hourly Rate
------------ ------ -----------
Cathy Hershcopf, Esq. Partner $795
Jeffrey L. Cohen, Esq. Partner $695
Michael A. Klein, Esq. Associate $665
Dana S. Katz, Esq. Associate $475
Robert Winning, Esq. Associate $435
Rebecca Goldstein Paralegal $270
The firm will also be reimbursed for any necessary out-of-pocket
expenses.
Ms. Herschcopf assures the Court that her firm is a "disinterested
person" as the term is defined in Section 101(14) of the
Bankruptcy Code and does not represent any interest adverse to the
Creditors' Committee.
Cooley LLP may be reached at:
Cathy R. Hershcopf, Esq.
Jeffrey L. Cohen, Esq.
Michael A. Klein, Esq.
COOLEY LLP
1114 Avenue of the Americas
New York, NY 10036
Tel: (212) 479-6000
E-mail: chershcopf@cooley.com
jcohen@cooley.com
mklein@cooley.com
The retention application will be presented in Court for approval
on June 13, 2013, at 12 p.m. (Eastern Time). Objections are due
June 10.
About KIT digital
New York-based KIT digital Inc. -- http://www.kitd.com/-- is a
video management software and services company. KIT digital
services nearly 2,500 clients in 50+ countries including some of
the world's biggest brands, such as Airbus, The Associated Press,
AT&T, BBC, BSkyB, Disney-ABC, Google, HP, MTV, News Corp, Sky
Deutschland, Sky Italia, Telecom Argentina, Telecom Italia,
Telefonica, Universal Studios, Verizon, Vodafone VRT and
Volkswagen.
KIT digital filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case
No. 13-11298) in Manhattan on April 25, 2013. The Debtor
disclosed $310,206,684 in assets and $23,011,940 in liabilities.
KIT's operating subsidiaries, including Ioko 365, Polymedia,
Kewego, Multicast and Megahertz are not included in the Chapter 11
filing.
Jennifer Feldsher, Esq., and Anna Rozin, Esq., at Bracewell &
Giuliani LLP, in New York, serve as counsel to the Debtor.
American Legal Claims Services LLC is the claims and noticing
agent and the administrative agent.
Under the Plan, General Unsecured Claims will be paid in full from
available cash.
KIT DIGITAL: Seeks to Employ Bankruptcy Professionals
-----------------------------------------------------
KIT digital, Inc., seeks authority from the U.S. Bankruptcy Court
for the Southern District of New York to employ the following
bankruptcy professionals:
-- Ropes & Gray LLP as special litigation counsel involving
securities litigation claims and derivatives actions to be
paid $730 to $1,210 per hour for partners; $875 to $1,195
per hour for senior counsel; $270 to $740 per hour for
associates; and $145 to $340 per hour for paralegals;
-- Jones Day as special counsel to advise the audit committee
of the Board of Directors with respect to the subpoena sent
by the U.S. Securities and Exchange Commission and a related
investigation, to be paid $625 to $825 per hour for partners
and $325 to $550 per hour for associates; and
-- Deutsche Bank Securities Inc., as investment banker, to be
paid a monthly fee of $100,000 up to six months following
the Petition Date; a transaction fee equal to the greater of
(i) 1.00% of the Aggregate Consideration and (ii)$2,800,000,
payable upon the consummation of a Transaction; and a
termination fee of 20.00% in connection with a transaction
that is not completed.
Peter L. Welsh, Esq. -- Peter.Welsh@ropesgray.com -- a partner at
Ropes & Gray LLP, in New York, discloses that in November 2012,
the firm held a retainer from the Debtor in the amount of $200,000
as security for its fees and costs. In the year prior to the
Petition Date, Ropes & Gray received approximately $225,564 in
compensation from the Debtor for all matters for which it was
engaged by the Debtor, which includes payments from the retainer
account. The retainer account was depleted in December 2012, Mr.
Welsh says.
Albert J. Rota, Esq. -- ajrota@jonesday.com -- a partner at Jones
Day, in Dallas, Texas, discloses that Jones Day holds a
prepetition claim against the Debtor for approximately $1,600,000
for services rendered and expenses incurred advising the Audit
Committee. Since the Petition Date, Jones Day has incurred
approximately $24,100 in fees and expenses in connection with its
provision of services to the Debtor.
William Lee Counselman, Jr., a managing director at Deutsche Bank
Securities Inc., discloses that the Debtor paid Deutsche Bank
approximately $339,604 for fees and expenses in fall 2012 in
connection with Deutsche Bank's representation of the Debtor, but
has not made any payments to Deutsche Bank since. As of the
Petition Date, Deutsche Bank held a prepetition claim against the
Debtor in the amount of approximately $679,209 for unpaid
prepetition fees and expenses in connection with the engagement.
The employment applications will be presented in Court for
approval on June 12, 2013, at 12:00 p.m. prevailing Eastern Time.
Objections are due June 7.
About KIT digital
New York-based KIT digital Inc. -- http://www.kitd.com/-- is a
video management software and services company. KIT digital
services nearly 2,500 clients in 50+ countries including some of
the world's biggest brands, such as Airbus, The Associated Press,
AT&T, BBC, BSkyB, Disney-ABC, Google, HP, MTV, News Corp, Sky
Deutschland, Sky Italia, Telecom Argentina, Telecom Italia,
Telefonica, Universal Studios, Verizon, Vodafone VRT and
Volkswagen.
KIT digital filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case
No. 13-11298) in Manhattan on April 25, 2013. The Debtor
disclosed $310,206,684 in assets and $23,011,940 in liabilities.
KIT's operating subsidiaries, including Ioko 365, Polymedia,
Kewego, Multicast and Megahertz are not included in the Chapter 11
filing.
Jennifer Feldsher, Esq., and Anna Rozin, Esq., at Bracewell &
Giuliani LLP, in New York, serve as counsel to the Debtor.
American Legal Claims Services LLC is the claims and noticing
agent and the administrative agent.
Under the Plan, General Unsecured Claims will be paid in full from
available cash.
LAKE PLEASANT: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Lake Pleasant Group, LLP
1941 W. Mitchell Drive
Phoenix, AZ 85015
Bankruptcy Case No.: 13-09574
Chapter 11 Petition Date: June 5, 2013
Court: U.S. Bankruptcy Court
District of Arizona (Phoenix)
Judge: Eileen W. Hollowell
Debtors' Counsel: Wesley Denton Ray, Esq.
POLSINELLI, P.C.
City Scape Plaza
One E. Washington Street, #1200
Phoenix, AZ 85004
Tel: (602) 650-2005
Fax: (602) 926-2751
E-mail: wray@polsinelli.com
- and ?
Philip R. Rudd, Esq.
POLSINELLI, P.C.
City Scape Plaza
One E. Washington Street, #1200
Phoenix, AZ 85004
Tel: (602) 650-2000
Fax: (602) 264-7033
E-mail: prudd@polsinelli.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
Affiliate that simultaneously filed for Chapter 11:
Debtor Case No.
------ --------
DLGC II, LLC 13-09576
Assets: $10,000,001 to $50,000,000
Debts: $1,000,001 to $10,000,000
Lake Pleasant Group and DLGC II, LLC did not file a list of
largest unsecured creditors together with the petitions.
The petitions were signed by Donald R. Leo, managing member of CVF
Holdings, LLC, as authorized partner.
LIFECARE HOLDINGS: Vibra Healthcare Completes Acquisition of CCHI
-----------------------------------------------------------------
Vibra Healthcare, LLC, an owner and operator of Long Term Acute
Care hospitals and Inpatient Rehabilitation Hospitals throughout
the country has completed the acquisition through an affiliate,
Vibra Hospital of Boise, LLC, of the Complex Care Hospital of
Idaho. CCHI was a wholly-owned subsidiary of LCI Holdco, LLC the
parent company of LifeCare Holdings, Inc., of Plano, Texas.
Vibra previously announced in April 2013 that under an interim
management agreement through an affiliate, Vibra Hospital of
Boise, LLC, the Company assumed day-to-day operations of CCHI
following Bankruptcy Court and regulatory approval. Subsequently,
Vibra received approval to acquire substantially all of the assets
of CCHI and the continued employment of CCHI's employees,
effective June 1, 2013 and has renamed the CCHI hospital, Vibra
Hospital of Boise.
"We are pleased to add the Vibra Hospital of Boise to our network
of specialty hospitals. Throughout Vibra's interim management of
the hospital we have been working diligently to ensure exceptional
care for our patients, their families and to provide a seamless
transition for our new employees. To further our strategic growth
objectives we will offer market specific programs and services to
meet the unique and complex needs in Boise and each healthcare
community Vibra serves," stated Brad Hollinger, Founder, Chairman
and CEO of Vibra Healthcare. "Vibra is committed to working
closely with local and regional providers to ensure patients and
their families receive the very best in patient care and family
support."
About Vibra Healthcare, LLC
Vibra Healthcare, LLC -- http://www.vibrahealthcare.com--
is a specialty hospital provider based in Mechanicsburg, Pa that
is focused on the development, acquisition and operation of
freestanding Critical Care Hospitals (LTAC), Inpatient Acute
Rehabilitation Hospitals (IRF) and outpatient physical
rehabilitation centers. Teams of highly trained specialists lead
clinical programs at Vibra's specialty hospitals for medically
complex patients who suffer from complex orthopedic, neurologic,
stroke, multiple trauma, cardiac and respiratory conditions.
Vibra and its affiliates currently employ over 5,000 employees and
own and operate over 50 specialty hospitals and outpatient
rehabilitation locations including 35 LTAC's and IRF's in 12
states.
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 lenders provided $25 million in secured financing for the
Chapter 11 case.
The Official Committee of Unsecured Creditors is represented by
Pachulski Stang Ziehl & Jones LLP. FTI Consulting, Inc., serves
as its financial advisor.
MARINAS INTERNATIONAL: Sails Into Chapter 11 Protection
-------------------------------------------------------
Marinas International Consolidated LP and two other subsidiaries
of Marinas International, which together run 11 marinas across the
U.S., filed for Chapter 11 bankruptcy protection (Bankr. D. Del.
Lead Case No. 13-11489).
The Debtor is represented by Christopher A. Ward, Esq., at
Polsinelli PC, in Wilmington, Delaware.
The Debtors are seeking an extension of the deadline to file
schedules of assets and liabilities. A hearing is slated for June
14.
Marinas International Consolidated estimated $1 million to $10
million in assets and at least $10 million in liabilities.
MEDSOLUTIONS HOLDINGS: Moody's Assigns B2 CFR; Outlook Stable
-------------------------------------------------------------
Moody's Investors Service assigned a B2 Corporate Family Rating
and B2-PD Probability of Default Rating to MedSolutions Holdings,
Inc. At the same time, Moody's assigned B2 (LGD3, 49%) ratings to
the company's proposed first lien senior secured credit
facilities, including a $360 million senior secured first lien
term loan B and a $75 million senior secured first lien revolver.
The proceeds from the senior secured credit facilities will be
used to refinance all of the company's existing debt, fund a one-
time $225 million special dividend to existing shareholders, and
pay transaction fees and expenses. The outlook for the ratings is
stable. This is the first time Moody's has publicly rated
MedSolutions Holdings, Inc.
All ratings are subject to review of final documentation.
Moody's assigned the following ratings:
$75 million senior secured first lien revolving credit facility
due 2018, rated B2 (LGD3, 49%)
$360 million senior secured first lien term loan due 2019, rated
B2 (LGD3, 49%)
Corporate Family Rating, B2
Probability of Default Rating, B2-PD
Ratings Rationale:
MedSolutions' B2 Corporate Family Rating reflects the company's
very high revenue concentration among its top customers and
products, material exposure to near-term contract expirations,
relatively high financial leverage, and aggressive financial
policy and shareholder-oriented strategy. The ratings are
supported by the company's leading scale and market position in
the specialty benefit management market, solid customer
relationships, lack of direct reimbursement risk, and favorable
fundamentals and macro trends within the specialty benefit
management market.
On a pro forma basis for the twelve months ended March 31, 2013,
MedSolutions' adjusted debt to EBITDA was approximately of 4.2
times. This includes Moody's view that the company's preferred
stock is being treated as 100% equity-like in accordance with
Moody's practice with regard to the treatment of hybrid securities
of this nature. Moody's expects MedSolutions' credit metrics to
improve over the intermediate-term, driven by earnings growth from
increased penetration among State Medicaid payors following the
expansion of Medicaid coverage in 2014. Moody's believes
MedSolutions is well-positioned to increase its state government
membership base over the next 12 to 18 months, as State Medicaid
programs will continue to face significant challenges including
rapidly increasing enrollment, state budget shortfalls and rising
utilization.
The rating outlook is stable, reflecting Moody's expectation that
financial leverage will improve over the next 12 to 18 months, and
that the company will exhibit improved cash flow to debt metrics.
The stable outlook also reflects Moody's assumption that the
company will successfully renew its contract with its second-
largest customer expiring at the end of 2013, and that the company
will not engage in additional debt-financed shareholder
initiatives.
While not expected over the near-term due to the company's high
customer and product concentration, the ratings could be upgraded
over time if the company significantly reduces the reliance on
revenue from its top customers via new contact wins and adjusted
debt to EBITDA is reduced below 3.0 times on a Moody's adjusted
basis.
The ratings could be downgraded if there is a material contraction
in the level of operating cash flow, such that free cash flow
turns negative, or if the company's liquidity deteriorates. In
addition, Moody's could downgrade the ratings if the company faces
the loss of a material contract, including any inability to extend
the contract with its second-largest customer, expiring in
December 2013. In addition, while unlikely, any unforeseen
contractual loss or reduction of services related to largest
customer prior to December 31, 2017 could result in a downgrade of
multiple notches. From a financial metrics perspective, the
ratings could be downgraded if adjusted debt to EBITDA is
sustained above 4.5 times on a Moody's adjusted basis.
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.
Headquartered in Franklin, Tennessee, MedSolutions Holdings, Inc.,
through its subsidiary MedSolutions, Inc. ("MedSolutions") is a
specialty benefit management company. MedSolutions provides
healthcare management and administrative services on behalf of
clients consisting primarily of health benefit plan sponsors
including health maintenance organizations, health insurers, state
government agencies, and other managed care organizations.
MedSolutions provides medical cost management services which
involve the design and administration of programs aimed at
reducing the cost, improving the quality, and more consistently
and efficiently utilizing diagnostic imaging services and other
areas of healthcare. Clients contract with MedSolutions under
capitation, administrative service and fee-for-service contracts.
MedSolutions has approximately 1,000 employees, including 45
physicians, approximately 190 nurses and over 200 in-take agents.
The company is privately owned by TA Associates, MedCare,
Ridgemont Equity Partners, management and employees, and other
investors. For the twelve months ended March 31, 2013, the company
generated total revenues of approximately $854 million.
MEDSOLUTIONS HOLDINGS: S&P Assigns 'B' Corp. Credit Rating
----------------------------------------------------------
Standard & Poor's Rating Services said it assigned its 'B'
corporate credit rating to Franklin, Tenn.-based MedSolutions
Holdings Inc. The outlook is stable. At the same time, S&P
assigned MedSolutions' $435 million in senior secured credit
facilities its 'B' issue-level ratings with a recovery rating of
'3', indicating its expectation for meaningful (50%-70%) recovery
for lenders in the event of a payment default. The senior secured
credit facilities include a $360 million term loan due 2019 and a
$75 million revolver due 2018.
"The ratings reflect MedSolutions' "vulnerable" business risk
profile and "aggressive" financial risk profile. We base the
vulnerable business risk profile assessment on the company's
narrow product scope, several key client concentrations with two
health care payers and one Medicaid contract, and comparable but
not standout EBITDA margins versus similarly rated peers," said
credit analyst James Sung. "We base the aggressive financial risk
profile largely on the company's aggressive financial policies,
which stem from its largely private equity/venture capital
ownership structure as reflected in its high debt leverage
tolerance. Pro forma for the transaction, the company's adjusted
debt leverage will be 4.2x, as of March 31, 2013."
S&P's stable rating outlook reflects its expectation that
MedSolutions' favorable revenue and earnings growth over the next
12 months will support credit metrics that support the rating.
S&P could consider lowering the ratings if flat to lower revenue
growth coupled with margin contraction increases leverage to 5.5x
or more, resulting in a highly leveraged financial risk profile.
The loss of one or two key clients, although highly unlikely over
the 12 months, would be one potential downside scenario.
Any rating upside over the next 12 months is limited. But S&P
could consider a rating upgrade beyond 12 months if the company is
able to grow and diversify its business model profitably, and if
its financial policies become sustainable less aggressive if, for
instance, adjusted leverage were to be sustained below 3.5x on an
adjusted basis.
MOUNTAIN NATIONAL: Company Mulls Ch. 7 After Bank Seized
--------------------------------------------------------
Mountain National Bank, Sevierville, Tennessee, was closed on June
7 by the Office of the Comptroller of the Currency, which
appointed the Federal Deposit Insurance Corporation (FDIC) as
receiver. To protect the depositors, the FDIC entered into a
purchase and assumption agreement with First Tennessee Bank,
National Association, Memphis, Tennessee, to assume all of the
deposits of Mountain National Bank.
As of March 31, 2013, Mountain National Bank had approximately
$437.3 million in total assets and $373.4 million in total
deposits. In addition to assuming all of the deposits of the
failed bank, First Tennessee Bank, National Association agreed to
purchase essentially all of the failed bank's assets.
As a result of the closure of the Bank, the amount of the holding
company Mountain National's liabilities exceeds the amount of its
assets. Accordingly, the Company will evaluate the potential
winding up of the Company, which may include the filing of a
voluntary petition in the United States Bankruptcy Court, Eastern
District of Tennessee, seeking relief under Chapter 7 of Title 11
of the United States Code.
In connection with the receivership of the Bank, the Company may
receive notices from the counterparties to the indentures and
guarantee agreements related to the Company's subordinated
debentures with a total principal amount of $13 million, of
alleged events of default under those agreements, and of those
counterparties' intentions to terminate those agreements or
accelerate the Company's performance of those agreements. In the
event of a default by the Company under those agreements, or in
the event of the termination of one or more of those agreements,
the Company's financial and other obligations under such
agreements may be accelerated.
About Mountain National
Mountain National is a bank holding company registered with the
Board of Governors of the Federal Reserve System under the Bank
Holding Company Act of 1956, as amended. The Company provided
banking services through its banking subsidiary,
Mountain National Bank.
Mountain National incurred a net loss of $39.25 million in 2011,
compared with a net loss of $10.45 million in 2010.
The Company's balance sheet at Dec. 31, 2011, showed $502.64
million in total assets, $504.98 million in total liabilities and
a $2.33 million total shareholders' deficit.
Crowe Horwath LLP, in Brentwood, Tennessee, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2011.
MW GROUP: Seeks Valuation of Bank of America's Collateral
---------------------------------------------------------
MW Group LLC has asked the U.S. Bankruptcy Court for the Western
District of North Carolina to determine the value of the claim of
Bank of America, N.A., secured by property of the estate for the
purposes of plan confirmation.
Bank of America asserts that as of the Petition Date it was owed
$5,201,057 in unpaid principal, $443,938 in accrued and unpaid
interest, and $80,424 in legal fees and costs.
Based upon appraisals conducted by Bidencope & Associates, the
Debtor contends that the fair market value of the Bank of America
collateral is $10,614,000. In particular, Bidencope & Associates
has appraised the Collateral as:
Property Value
-------- -----
Vacant Land $2,454,000
Condominiums $1,360,000
Apartments $6,800,000
Total Collateral Value: $10,614,000
About MW Group
Charlotte, North Carolina-based MW Group LLC filed for Chapter 11
bankruptcy (Bankr. W.D.N.C. Case No. 11-32674) on Oct. 21, 2011.
The Debtor scheduled assets of $10.32 million and liabilities of
$8.42 million. Donald R. James signed the petition as manager.
The Debtor's assets consist of 36.5 acres of vacant land, 48 condo
units for rent, and 200 apartments known as Weyland and Weyland
II, located in Charlotte, Mecklenburg County, North Carolina.
The Debtor is represented by Christine L. Myatt, Esq., at Nexsen
Pruet, PLLC, in Greensboro, North Carolina.
No official committee of unsecured creditors has been appointed in
the case.
NAMCO LLC: Has Final Approval of $16MM Salus DIP Financing
----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware has
authorized, on a final basis, Namco LLC to:
(i) obtain up to $16,000,000 in postpetition financing,
pursuant to a senior secured priority debtor-in-
possession credit agreement, as amended, between
the Debtor and Salus CLO 2012-1, Ltd.; and
(ii) use cash collateral.
According to the Debtor, no credit was available on more favorable
terms as that committed by the DIP lender.
The Debtor would use the funds to finance the day-to-day
operations and working capital needs; and repay all outstanding
prepetition obligations under the prepetition credit agreement.
As adequate protection from any diminution in value of the
lender's collateral, the Debtor will grant replacement liens upon
substantially all of the Debtor's real and personal property,
superpriority administrative expense claim status, subject to
carve out on certain expenses.
About Namco
Manchester, Connecticut-based Namco, LLC, is a 37-store retailer
of swimming pools and accessories owned 50-50 by Garmark Partners
II LLC and J.H. Whitney & Co. It filed a petition for Chapter 11
protection (Bankr. D. Del. Case No. 13-10610) on March 24, 2013,
in Wilmington. Judge Peter J. Walsh presides over the case.
Anthony M. Saccullo, Esq., at A.M. Saccullo Legal, LLC, and Thomas
H. Kovach, Esq., at Thorp Reed & Armstrong, LLP, serve as the
Debtor's counsel. Olshan Frome & Wolosky, LLP, is the Debtor'
general bankruptcy counsel. Epiq Bankruptcy Solutions, LLC, is
the Debtor's claims and noticing agent. Clear Thinking Group,
LLC, serves as the Debtor's restructuring agent.
The Debtor disclosed $32,372,123 in assets and $53,908,778 in
liabilities as of the Chapter 11 filing. The Petition was signed
by Lee Diercks, chief restructuring officer.
Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed seven
members to the Official Committee of Unsecured Creditors.
The reorganization of the Debtor is being financed with a
$16 million loan provided by Salus Capital Partners LLC, owed
$9.3 million on a prepetition revolving credit.
NATIONAL ENVELOPE: Receives Approval to Borrow $60-Mil.
-------------------------------------------------------
NE Opco Inc. can now access $60 million of the $67.5 million of
financing being provided by lenders led by Salus Capital Partners
LLC as agent, after Bankruptcy Judge Christopher Sontchi granted
interim approval of the financing.
The Debtors are seeking final approval of their request to access
DIP financing and use cash collateral at a hearing slated for
July 1 at 10:00 a.m. Objections are due June 26.
The DIP loans will pay off the existing $15.6 million first-lien
term loan and $34.9 million revolving credit with the remaining
amount supplying the Debtors with liquidity to fund the Chapter 11
case.
The DIP facility consists of a term loan of $67.5 million:
(a) $47.5 million of Tranche A commitments, (b) $17.5 million of
Tranche A-1 commitments, and (c) $2.5 million of trade credit
provided by International Paper Company as Tranche B debt.
The Tranche A Debt bears annual interest rate of 5.25 percent plus
a Base Rate, and the Tranche A-1 Debt bears an annual interest
rate of 9.25% plus a Base Rate. The Tranche B trade credit
facility bears an annual interest of 10 percent.
The DIP Facility has a maturity date of June 10, 2014. However,
it requires the Debtors to achieve certain milestones. The DIP
Facility contemplates the filing of a plan of reorganization or
sale of substantially all of the Debtors' assets under Sec. 363 of
the Bankruptcy Code under pre-established timelines:
* In a reorganization:
-- Filing of a plan of reorganization no later than 60 days
after the Petition Date;
-- Entry of an order approving the Disclosure Statement
within 100 days after the Petition Date;
-- Consummation of the Plan within 105 days after the
Petition Date;
* In a sale:
-- Filing of bidding procedures motion not later than
60 days after the Petition Date;
-- Solicitation of bids not later than 75 days after the
Petition Date;
-- Selection of the winning bidder not later than 90 days
after the Petition Date;
-- Approval of the sale and the winning bidder within 100
days after the Petition Date;
-- Consummation of the sale within 105 days of the Petition
Date.
A copy of the Interim DIP Order is available for free at:
http://bankrupt.com/misc/NE_Opco_Interim_DIP_Order.pdf
Other First Day Motions
Judge Sontchi at a hearing on June 11 also approved other "first
day" motions filed by the Debtors. The Debtors have interim
approval to, among other things, pay prepetition wages owed to
1,672 employees, maintain their customer programs, pay prepetition
taxes, prohibit utilities from discontinuing service, and maintain
their insurance policies.
About National Envelope
National Envelope is the largest privately-help manufacturer of
envelopes in North America. Headquartered in Frisco, Texas,
National Envelope has eight plants and 15 percent of the envelope
market. Revenue of $427 million in 2012 resulted in a $60.1
million net loss, continuing an unbroken string of losses since
2007.
NE OPCO, Inc., doing business as National Envelope, along with
affiliate NEV Credit Holdings, Inc., filed petitions seeking
relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Del.
Lead Case No. 13-11483) on June 10, 2013.
The company disclosed liabilities including $148.4 million in
secured debt, with $37.5 million owing on a revolving credit and
$15.6 million on a secured term loan. There is a $55.7 million
second-lien debt 82 percent held by a Gores Group LLC affiliate.
National Envelope, then known as NEC Holdings Corp., first sought
Chapter 11 protection (Bankr. D. Del. Lead Case No. 10-11890) on
June 10, 2010. The business was bought by Gores Group LLC for
$208 million in a bankruptcy sale.
National Envelope, through NE OPCO, has returned to bankruptcy to
pursue a plan of reorganization or sell the assets as a going
concern via 11 U.S.C. Sec. 363. The Debtor plans to facilitate a
sale of the business with publicly traded competitor Cenveo Inc.
In the new Chapter 11 case, the company has tapped the law firm
Richards, Layton & Finger as counsel, PricewaterhouseCoopers LLP
as financial adviser, and Epiq Bankruptcy Solutions as claims and
notice agent.
The Gores Group is represented by Weil, Gotshal and Manges LLP and
Lowenstein Landler LLP. Salus Capital Partners, the DIP agent, is
represented by Choate, Hall & Stewart LLP and Morris Nichols Arsht
& Tunnell LLP. Wells Fargo Capital Finance, LLC, the prepetition
senior agent, is represented by Goldberg Kohn Ltd and DLA Piper.
NATIONAL ENVELOPE: Wins OK to Tap Epiq as Claims Agent
------------------------------------------------------
NE OPCO, Inc. and NEV Credit Holdings, Inc. sought and obtained
approval to employ Epiq Systems as claims and noticing agent.
The Debtors have not yet filed their schedules of assets and
liabilities but they estimate that there will be in excess of
11,000 entities to be noticed.
Epiq agreed to a retainer of $15,000.
As claims agent, Epiq will charge the Debtors at these discounted
rates:
Position Hourly Rate
-------- -----------
Clerical $35 to $50
Case Manager $60 to $95
IT/ Programming $80 to $150
Senior Case Manager $100 to $140
Consultant $120 to $170
Senior Consultant $175 to $225
Senior Managing Consultant $230 to $270
Communication Counselor $250 to $295
For its noticing services, Epiq will charge $50 per 1,000 e-mails,
and $0.10 per page for facsimile noticing. For database
maintenance, the firm will charge $0.10 per record per month, with
fees for the first three months waived. For-online claim filing
services, Epiq will charge $600 per 100 claims filed. For its
solicitation and balloting services, Epiq will charge $325 per
hour for work provided by the executive vice president and the
standard hourly rates for other associates.
About National Envelope
National Envelope is the largest privately-help manufacturer of
envelopes in North America. Headquartered in Frisco, Texas,
National Envelope has eight plants and 15 percent of the envelope
market. Revenue of $427 million in 2012 resulted in a $60.1
million net loss, continuing an unbroken string of losses since
2007.
NE OPCO, Inc., doing business as National Envelope, along with
affiliate NEV Credit Holdings, Inc., filed petitions seeking
relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Del.
Lead Case No. 13-11483) on June 10, 2013.
The company disclosed liabilities including $148.4 million in
secured debt, with $37.5 million owing on a revolving credit and
$15.6 million on a secured term loan. There is a $55.7 million
second-lien debt 82 percent held by a Gores Group LLC affiliate.
National Envelope, then known as NEC Holdings Corp., first sought
Chapter 11 protection (Bankr. D. Del. Lead Case No. 10-11890) on
June 10, 2010. The business was bought by Gores Group LLC for
$208 million in a bankruptcy sale.
National Envelope, through NE OPCO, has returned to bankruptcy to
pursue a plan of reorganization or sell the assets as a going
concern via 11 U.S.C. Sec. 363. The Debtor plans to facilitate a
sale of the business with publicly traded competitor Cenveo Inc.
In the new Chapter 11 case, the company has tapped the law firm
Richards, Layton & Finger as counsel, PricewaterhouseCoopers LLP
as financial adviser, and Epiq Bankruptcy Solutions as claims and
notice agent.
The Gores Group is represented by Weil, Gotshal and Manges LLP and
Lowenstein Landler LLP. Salus Capital Partners, the DIP agent, is
represented by Choate, Hall & Stewart LLP and Morris Nichols Arsht
& Tunnell LLP. Wells Fargo Capital Finance, LLC, the prepetition
senior agent, is represented by Goldberg Kohn Ltd and DLA Piper.
NAVISTAR INTERNATIONAL: Incurs $374MM Net Loss in 2nd Quarter
-------------------------------------------------------------
Navistar International Corporation filed with the U.S. Securities
and Exchange Commission its quarterly report on Form 10-Q
disclosing a net loss attributable to the Company of $374 million
on $2.52 billion of net sales and revenues for the three months
ended April 30, 2013, as compared with a net loss attributable to
the Company of $172 million on $3.26 billion of net sales and
revenues for the same period during the prior year.
For the six months ended April 30, 2013, the Company incurred a
net loss attributable to the Company of $497 million on $5.16
billion of net sales and revenues, as compared with a net loss
attributable to the Company of $325 million on $6.27 billion of
net sales and revenues for the same period a year ago.
As of April 30, 2013, the Company had $8.72 billion in total
assets, $12.36 billion in total liabilities and a $3.64 billion
total stockholders' deficit.
"We are not satisfied with our overall financial results this
quarter, but we are pleased with the continued progress we made in
a number of areas on our turnaround plan," said Troy A. Clarke,
Navistar president and chief executive officer. "We still face
some significant, yet solvable challenges, primarily in the areas
of higher pre-existing warranty costs for our earlier EPA 2010
emissions level engines, as well as in rebuilding sales and
restoring market share. However, we are already implementing the
right leadership and business process changes to effectively
address these priority issues."
A copy of the Form 10-Q is available for free at:
http://is.gd/yeDa7M
About Navistar International
Navistar International Corporation (NYSE: NAV) --
http://www.Navistar.com/-- is a holding company whose
subsidiaries and affiliates subsidiaries produce International(R)
brand commercial and military trucks, MaxxForce(R) brand diesel
engines, IC Bus(TM) brand school and commercial buses, Monaco RV
brands of recreational vehicles, and Workhorse(R) brand chassis
for motor homes and step vans. It also is a private-label
designer and manufacturer of diesel engines for the pickup truck,
van and SUV markets. The Company also provides truck and diesel
engine parts and service. Another affiliate offers financing
services.
Navistar incurred a net loss attributable to the Company of $3.01
billion for the year ended Oct. 31, 2012, compared with net income
attributable to the Company of $1.72 billion during the prior
year.
* * *
In the Aug. 3, 2012, edition of the TCR, Moody's Investors Service
lowered Navistar International Corporation's Corporate Family
Rating (CFR), Probability of Default Rating (PDR), and senior note
rating to B2 from B1. The downgrade of Navistar's ratings
reflects the significant challenges the company will face during
the next eighteen months in re-establishing the profitability and
competitiveness of its US and Canadian truck operations in light
of the failure to achieve EPA certification of its EGR emissions
technology, the significant reductions in military revenues and
substantially higher engine warranty reserves.
As reported by the TCR on June 13, 2012, Standard & Poor's Ratings
Services lowered its ratings on Navistar International Corp.,
including the corporate credit rating to 'B+', from 'BB-'. "The
downgrade and CreditWatch placement reflect the company's
operational and financial setbacks in recent months," said
Standard & Poor's credit analyst Sol Samson.
As reported by the TCR on Jan. 24, 2013, Fitch Ratings has
affirmed the Issuer Default Ratings (IDR) for Navistar
International Corporation and Navistar Financial Corporation at
'CCC' and removed the Negative Outlook on the ratings. The
removal reflects Fitch's view that immediate concerns about
liquidity have lessened, although liquidity remains an important
rating consideration as NAV implements its selective catalytic
reduction (SCR) engine strategy. Other rating concerns are already
incorporated in the 'CCC' rating.
NNN 3500: Submits First Amended Chapter 11 Plan
-----------------------------------------------
NNN 3500 Maple 26, LLC, submitted to the U.S. Bankruptcy Court for
the Northern District of Texas its First Amended Plan of
Reorganization.
The Plan designates and provides for 9 classes of claims and
interests in the Debtor:
* Class 1 Secured Tax Claims
* Class 2 Secured Claim of s Wachovia Bank Commercial Mortgage
Trust, Commercial Mortgage Pass-Through Certificates,
Series 2006-C23 (the "Trust")
* Class 3 Secured Claim of Comm-Fit, L.P.
* Class 4 Secured Claim of Jemm Investments, Inc.
* Class 5 Secured Claim of Phoenix Commercial, Inc.
* Class 6 Convenience Class of Unsecured Claims ($1,000 or less)
* Class 7 Unsecured (General) Claims
* Class 8 Claims of Other Tenants-in-common (TICs)
* Class 9 Interests in the Debtor
Holders of Claims in Classes 1 to 5 will retain their liens in
their collateral until all their claims are paid in full, to the
extent allowed by the Court.
Holders of Allowed Convenience Claims are expected to recover 90%
of their claims. Each holder of an Allowed Class 7 General
Unsecured Claim will receive payment in full of its Claim, with
interest, in two substantially equal annual installments.
On the Effective Date, Class 8 Claims will be deemed satisfied in
full by virtue of the issuance of new ownership interests in the
Reorganized Debtor.
Holders of membership Interests in the Debtor shall either (a)
retain their respective Interests in the Debtor following the
Effective Date or (b) receive, on account of their Interests in
the Debtor, a share of interests in the Reorganized Debtor in
proportion to the Debtor's ownership interest in the Property.
Restructuring Officer Mubeen Aliniazee signed the Plan document.
A full-text copy of the First Amended Plan dated June 3, 2013 is
available for free at:
http://bankrupt.com/misc/NNN3500_1stAmdPlanJune3.pdf
Michelle V. Larson, Esq. of Andrews Kurth LLP, in Dallas, Texas
and
Jeff P. Prostok, Esq., of Forshey & Prostok, LLP, in Fort Worth,
Texas, represent the Debtor.
About NNN 3500
NNN 3500 Maple 26, LLC, based in Costa Mesa, Calif., filed for
Chapter 11 bankruptcy (Bankr. C.D. Cal. Case No. 12-23718) on
Nov. 30, 2012. Judge Scott C. Clarkson presides over the case.
In its schedules, the Debtor disclosed $45,563,241 in total assets
and $46,658,593 in total liabilities.
The U.S. Bankruptcy Court for the Northern District of Texas
opined that based on the record, it does not find that the Debtor
filed the bankruptcy case in bad faith.
ORCHARD SUPPLY: Receives Non-Compliance Notice From NASDAQ
----------------------------------------------------------
Orchard Supply Hardware Stores Corporation received written notice
from the NASDAQ Stock Market indicating that the Company is no
longer in compliance with NASDAQ Listing Rule 5605(b)(1), which
requires that a majority of the Board be comprised of independent
directors. In accordance with NASDAQ Listing Rule 5605(b)(1)(A),
the Notice states that Nasdaq will provide the Company a cure
period, in order to regain compliance, until the earlier of the
Company's next annual meeting of stockholders' or May 2, 2014; or
if the next annual stockholders' meeting is held before Oct. 29,
2013, then the Company must evidence compliance no later than
Oct. 29, 2013.
On June 4, 2013, William C. Crowley, Chairman of the Board of
Directors of the Company and a Board member previously elected by
the holders of the Company's Class A Common Stock, voting as a
separate class, resigned as a Class A Director of the Company.
Effective June 4, 2013, in accordance with the Company's Amended
and Restated Certificate of Incorporation, the Board members
elected by the holders of the Company's Class A Common Stock,
voting as a separate class, appointed David I. Bogage as a member
of the Board as a Class A Director. Mr. Bogage has been the
Company's Senior Vice President, Human Resources since April 2011.
From February 2009 to January 2011, Mr. Bogage was Senior Vice
President, Talent and Organizational Development of The Scotts
Miracle-Gro Co., a manufacturer and marketer of branded consumer
lawn and garden products. From August 2003 to March 2008, he was
Senior Vice President, Human Resources and Organizational
Development for The Haskell Company and from 1994 to 2003 he was
Vice President, Human Resources at The Home Depot, Inc.
About Orchard Supply
San Jose, Cal.-based Orchard Supply Hardware Stores Corporation
operates neighborhood hardware and garden stores focused on paint,
repair and the backyard. It was spun off from Sears Holdings
Corp. in 2012.
As reported by the Troubled Company Reporter on March 8, 2013,
Orchard Supply on Feb. 11, 2013, expanded its existing Senior
Secured Credit Facility with Wells Fargo Capital Finance and Bank
of America, N.A., increasing total borrowing capacity to $145
million through the addition of a $17.5 million last-in-last-out
supplemental term loan tranche. On Feb. 14, the Company obtained
a waiver from current Term Loan lenders related to compliance with
the leverage ratio covenant for the fiscal quarter ended Feb. 2,
2013, and the fiscal quarter ending May 4, 2013, which means that
the next applicable measurement date for the leverage covenant is
Aug. 3, 2013, subject to the Company's continued compliance with
the terms and conditions set forth in the waiver. The Company
continues to work with Moelis & Co. toward the refinancing or
modification of its Senior Secured Term Loan. The Company also
continues to explore several actions designed to restructure its
balance sheet for a sustainable capital structure, including
seeking new long term debt or equity.
The Wall Street Journal has reported that Orchard Supply also has
hired restructuring lawyers at DLA Piper and financial adviser FTI
Consulting, while people familiar with the matter said some
lenders involved in restructuring talks have engaged Zolfo Cooper
LLC and Dechert LLP. WSJ relates people familiar with the talks
said Orchard Supply and its lenders are discussing an out-of-court
restructuring or a so-called prepackaged bankruptcy filing.
Orchard Supply disclosed a net loss of $118.37 million for the
fiscal year ended Feb. 2, 2013, as compared with a net loss of
$14.45 million for the fiscal year ended Jan. 28, 2012. The
Company's balance sheet at Feb. 2, 2013, showed $407.41 million in
total assets, $438.02 million in total liabilities and a $30.61
million total stockholders' deficit.
Bankruptcy Warning
"[W]hile we anticipate continued compliance with the terms and
conditions of the waiver while we address the terms of our
restructuring, failure to comply with the terms and conditions of
the waiver could cause the effectiveness of the waiver to
terminate. In the event the waiver terminates, there would be a
default under the Senior Secured Term Loan and, as a result, the
lenders under the Senior Secured Term Loan could declare the
outstanding indebtedness to be due and payable, in acceleration of
the current maturity dates of December 21, 2013 and December 21,
2015. As a result of the cross-default provisions in our debt
agreements, a default under the Senior Secured Term Loan could
result in a default under, and the acceleration of, payments in
the Senior Secured Credit Facility. If payments under our credit
facilities were to be accelerated, we anticipate that we would
seek protection under the Bankruptcy Code," according to the
Company's annual report for the period ended Dec. 31, 2012.
* * *
As reported by the Troubled Company Reporter on Dec. 13, 2012,
Standard & Poor's Ratings Services lowered its corporate credit
rating on Orchard Supply to 'CCC' from 'B-'. The outlook is
negative.
"We are also lowering our rating on the company's term loan to
'CCC' from 'B-' in conjunction with the downgrade. The recovery
rating remains '4' recovery rating, indicating our expectation for
average (30% to 50%) recovery in the event of a payment default,"
S&P said.
"The ratings on Orchard Supply reflects Standard & Poor's Ratings
Services' assessment of its financial risk profile as 'highly
leveraged,' which incorporates near-term potential for
noncompliance with financial covenants and significant debt
refinancing risks. Our view of its business risk profile as
'vulnerable' considers the company's small size relative to the
highly competitive home improvement segment of the retail industry
and its exposure to housing market conditions in California," S&P
said.
ORCHARD SUPPLY: Fairholme No Longer Owns Class A Shares
-------------------------------------------------------
In an amended Schedule 13G filing with the U.S. Securities and
Exchange Commission, Fairholme Capital Management, L.L.C., and its
affiliates disclosed that, as of May 31, 2013, they do not
beneficially own Class A Common Stock of Orchard Supply Hardware
Stores Corporation. The reporting persons previously disclosed
beneficial ownership of 604,143 Class A shares as of Dec. 31,
2012. A copy of the amended regulatory filing is available at:
http://is.gd/lSCFgd
About Orchard Supply
San Jose, Cal.-based Orchard Supply Hardware Stores Corporation
operates neighborhood hardware and garden stores focused on paint,
repair and the backyard. It was spun off from Sears Holdings
Corp. in 2012.
As reported by the Troubled Company Reporter on March 8, 2013,
Orchard Supply on Feb. 11, 2013, expanded its existing Senior
Secured Credit Facility with Wells Fargo Capital Finance and Bank
of America, N.A., increasing total borrowing capacity to $145
million through the addition of a $17.5 million last-in-last-out
supplemental term loan tranche. On Feb. 14, the Company obtained
a waiver from current Term Loan lenders related to compliance with
the leverage ratio covenant for the fiscal quarter ended Feb. 2,
2013, and the fiscal quarter ending May 4, 2013, which means that
the next applicable measurement date for the leverage covenant is
Aug. 3, 2013, subject to the Company's continued compliance with
the terms and conditions set forth in the waiver. The Company
continues to work with Moelis & Co. toward the refinancing or
modification of its Senior Secured Term Loan. The Company also
continues to explore several actions designed to restructure its
balance sheet for a sustainable capital structure, including
seeking new long term debt or equity.
The Wall Street Journal has reported that Orchard Supply also has
hired restructuring lawyers at DLA Piper and financial adviser FTI
Consulting, while people familiar with the matter said some
lenders involved in restructuring talks have engaged Zolfo Cooper
LLC and Dechert LLP. WSJ relates people familiar with the talks
said Orchard Supply and its lenders are discussing an out-of-court
restructuring or a so-called prepackaged bankruptcy filing.
Orchard Supply disclosed a net loss of $118.37 million for the
fiscal year ended Feb. 2, 2013, as compared with a net loss of
$14.45 million for the fiscal year ended Jan. 28, 2012. The
Company's balance sheet at Feb. 2, 2013, showed $407.41 million in
total assets, $438.02 million in total liabilities and a $30.61
million total stockholders' deficit.
Bankruptcy Warning
"[W]hile we anticipate continued compliance with the terms and
conditions of the waiver while we address the terms of our
restructuring, failure to comply with the terms and conditions of
the waiver could cause the effectiveness of the waiver to
terminate. In the event the waiver terminates, there would be a
default under the Senior Secured Term Loan and, as a result, the
lenders under the Senior Secured Term Loan could declare the
outstanding indebtedness to be due and payable, in acceleration of
the current maturity dates of December 21, 2013 and December 21,
2015. As a result of the cross-default provisions in our debt
agreements, a default under the Senior Secured Term Loan could
result in a default under, and the acceleration of, payments in
the Senior Secured Credit Facility. If payments under our credit
facilities were to be accelerated, we anticipate that we would
seek protection under the Bankruptcy Code," according to the
Company's annual report for the period ended Dec. 31, 2012.
* * *
As reported by the Troubled Company Reporter on Dec. 13, 2012,
Standard & Poor's Ratings Services lowered its corporate credit
rating on Orchard Supply to 'CCC' from 'B-'. The outlook is
negative.
"We are also lowering our rating on the company's term loan to
'CCC' from 'B-' in conjunction with the downgrade. The recovery
rating remains '4' recovery rating, indicating our expectation for
average (30% to 50%) recovery in the event of a payment default,"
S&P said.
"The ratings on Orchard Supply reflects Standard & Poor's Ratings
Services' assessment of its financial risk profile as 'highly
leveraged,' which incorporates near-term potential for
noncompliance with financial covenants and significant debt
refinancing risks. Our view of its business risk profile as
'vulnerable' considers the company's small size relative to the
highly competitive home improvement segment of the retail industry
and its exposure to housing market conditions in California," S&P
said.
PATRIOT COAL: Walked Out of Talks, Miners Union Says
----------------------------------------------------
Jacqueline Palank, writing for Dow Jones Newswires, reports that
Patriot Coal Corp.'s chief executive and the head of its mine
worker's union traded barbs Wednesday after the union accused the
company of walking out of negotiations to reach new labor terms.
According to WSJ, Patriot CEO Ben Hatfield said the United Mine
Workers of America union's claims were "theatrics" and untrue --
the company didn't break off negotiations, he said, and in fact
only learned future talks were canceled from the union's news
release. Hours earlier, the union said Patriot walked out of
talks Tuesday and canceled future sessions in order to impose
concessions that a bankruptcy judge approved last month, a ruling
the union has decided to appeal.
"I can only conclude at this point that there is no end to the
depths of sacrifices our members and retirees are expected to
make," UMWA President Cecil E. Roberts said, according to the
report.
The report relates UMWA spokesman Phil Smith said that while the
vote isn't specifically a strike vote, a strike hasn't been ruled
out. "The results of that vote will inform the union leadership
as to how to proceed," he said in an interview Wednesday.
On May 29, Bankruptcy Judge Kathy A. Surratt-States in St. Louis,
Missouri, granted Patriot's request to void its union contracts
and impose wage and benefit concessions on its current and retired
miners. The union has taken an appeal from the ruling.
The report recounts that following the judge's ruling, Patriot
said it would hold off from imposing its new labor terms to allow
those talks to proceed, though it warned its "financial needs"
require action by July 1.
About Patriot Coal
St. Louis-based Patriot Coal Corporation (NYSE: PCX) is a producer
and marketer of coal in the eastern United States, with 13 active
mining complexes in Appalachia and the Illinois Basin. The
Company ships to domestic and international electricity
generators, industrial users and metallurgical coal customers, and
controls roughly 1.9 billion tons of proven and probable coal
reserves.
Patriot Coal and nearly 100 affiliates filed voluntary Chapter 11
petitions in U.S. bankruptcy court in Manhattan (Bankr. S.D.N.Y.
Lead Case No. 12-12900) on July 9, 2012. Patriot said it had
$3.57 billion of assets and $3.07 billion of debts, and has
arranged $802 million of financing to continue operations during
the reorganization.
Davis Polk & Wardwell LLP is serving as legal advisor, Blackstone
Advisory Partners LP is serving as financial advisor, and AP
Services, LLC is providing interim management services to Patriot
in connection with the reorganization. Ted Stenger, a Managing
Director at AlixPartners LLP, the parent company of AP Services,
has been named Chief Restructuring Officer of Patriot, reporting
to the Chairman and CEO. GCG, Inc. serves as claims and noticing
agent.
The U.S. Trustee appointed a seven-member creditors committee.
Kramer Levin Naftalis& Frankel LLP serves as its counsel.
HoulihanLokey Capital, Inc., serves as its financial advisor and
investment banker. Epiq Bankruptcy Solutions, LLC, serves as its
information agent.
On Nov. 27, 2012, the New York bankruptcy judge moved Patriot's
bankruptcy case to St. Louis. The order formally sending the
reorganization to Missouri was signed December 19 by the
bankruptcy judge. The New York Judge in a Jan. 23, 2013 order
denied motions to transfer the venue to the U.S. Bankruptcy Court
for the Southern District of West Virginia.
PATRIOT COAL: Disputes UMWA Characterization of Negotiations
------------------------------------------------------------
Patriot Coal Corporation responded on June 12 to the press release
issued by the United Mine Workers of America concerning
negotiations between Patriot and the UMWA. Contrary to the UMWA's
assertion, Patriot has not "walked out" of negotiations with the
UMWA. In fact, the Company only learned that next week's planned
negotiating meetings were cancelled from the UMWA's press release.
Patriot continues to be ready to reach a consensual agreement.
"The press release issued by the UMWA is inaccurate and
distorted," stated Patriot President and Chief Executive Officer
Ben Hatfield. "Patriot has been working diligently with the UMWA
in efforts to address their concerns about the contractual changes
found to be necessary, fair and equitable by the Bankruptcy Court.
If our goal was to force acceptance of the court-approved contract
as is, no further discussions would have been necessary, as that
option has been available to us since May 29. Instead, we have
offered up millions of dollars in additional contract
enhancements, including wage increases, healthcare improvements,
life insurance, and paid personal time off. The two-day recess in
negotiations that the Company requested for the current week was
needed for financial analysis of UMWA demands that Patriot roll
back the majority of cost relief approved by the Bankruptcy Court.
It remains the assessment of Patriot management that agreeing to
the UMWA's demands would sacrifice any chance of making the
Company viable."
On May 29, 2013, U.S. Bankruptcy Judge Kathy Surratt-States
granted Patriot's motion under sections 1113 and 1114 of the
Bankruptcy Code. The Court authorized Patriot to implement
proposals that would adjust employee wages and benefits to a level
consistent with the regional market, and transition retiree
healthcare obligations to a VEBA. The VEBA would be funded with
hundreds of millions of dollars, consisting of (1) a 35% ownership
stake in the reorganized company which the UMWA would monetize for
a substantial cash contribution, (2) an initial cash contribution
of $15 million, (3) royalty contributions for every ton of coal
produced by Patriot and (4) profit-sharing payments. Despite
being under no obligation to do so, Patriot has voluntarily
continued to bargain with the UMWA in an effort to reach a
consensual agreement on terms more favorable to the UMWA than the
proposals approved by the Court.
"In these continuing discussions, Patriot has offered substantial
improvements for our UMWA employees that result in a wage and
benefit package that is clearly favorable to the regional labor
market," Mr. Hatfield said. "However, we cannot support UMWA
demands for changes in the court-approved contract that would
increase Patriot losses by over $40 million per year in 2013,
2014, and 2015. If we did, Patriot would not emerge from
bankruptcy."
"Patriot continues to respect the need for confidentiality in the
negotiations if the parties are to make progress," Mr. Hatfield
continued. "Unlike the UMWA, we will not grandstand in the media
or issue press releases filled with distortions about the parties'
discussions. Rather than spending time on such theatrics, we are
hopeful that the UMWA will return to the negotiating table and
work toward a solution that allows Patriot to survive and continue
to provide 4,000 jobs and meaningful healthcare benefits for
thousands of retirees and their families."
The UMWA has threatened to strike if Patriot implements the
proposals approved by the Court. Commenting on the possibility of
a strike, Hatfield noted: "A strike would put the company on a
path to liquidation, which is the worst possible outcome for UMWA
employees and retirees. Patriot's unionized work force would be
left with limited job opportunities in a difficult coal market,
and our UMWA retirees would likely be left with zero healthcare
coverage. We are disappointed that President Roberts appears to
be ignoring the painful lessons of the Hostess bankruptcy, where
the intransigence of union leaders resulted in the company's
liquidation and the loss of more than 18,000 jobs. It is critical
that the UMWA agrees to continue productive negotiations if this
devastating outcome is to be avoided."
Note: Background of Patriot's restructuring and transformation can
be found at the Company's website, www.patriotcoal.com.
About Patriot Coal
Patriot Coal Corporation is a producer and marketer of coal in the
eastern United States, with 11 active mining complexes in
Appalachia and the Illinois Basin. Patriot ships to domestic and
international electricity generators, industrial users and
metallurgical coal customers, and controls approximately 1.8
billion tons of proven and probable coal reserves.
About Patriot Coal
St. Louis-based Patriot Coal Corporation (NYSE: PCX) is a producer
and marketer of coal in the eastern United States, with 13 active
mining complexes in Appalachia and the Illinois Basin. The
Company ships to domestic and international electricity
generators, industrial users and metallurgical coal customers, and
controls roughly 1.9 billion tons of proven and probable coal
reserves.
Patriot Coal and nearly 100 affiliates filed voluntary Chapter 11
petitions in U.S. bankruptcy court in Manhattan (Bankr. S.D.N.Y.
Lead Case No. 12-12900) on July 9, 2012. Patriot said it had
$3.57 billion of assets and $3.07 billion of debts, and has
arranged $802 million of financing to continue operations during
the reorganization.
Davis Polk & Wardwell LLP is serving as legal advisor, Blackstone
Advisory Partners LP is serving as financial advisor, and AP
Services, LLC is providing interim management services to Patriot
in connection with the reorganization. Ted Stenger, a Managing
Director at AlixPartners LLP, the parent company of AP Services,
has been named Chief Restructuring Officer of Patriot, reporting
to the Chairman and CEO. GCG, Inc. serves as claims and noticing
agent.
The U.S. Trustee appointed a seven-member creditors committee.
Kramer Levin Naftalis& Frankel LLP serves as its counsel.
HoulihanLokey Capital, Inc., serves as its financial advisor and
investment banker. Epiq Bankruptcy Solutions, LLC, serves as its
information agent.
On Nov. 27, 2012, the New York bankruptcy judge moved Patriot's
bankruptcy case to St. Louis. The order formally sending the
reorganization to Missouri was signed December 19 by the
bankruptcy judge. The New York Judge in a Jan. 23, 2013 order
denied motions to transfer the venue to the U.S. Bankruptcy Court
for the Southern District of West Virginia.
PHIL'S CAKE: Gets Approval to Continue Using Cash Collateral
------------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida,
according to Phil's Cake Box Bakeries, Inc.'s case docket,
authorized the Debtor's continued access to cash collateral.
Previously, the Court entered a seventh interim agreed order
allowing the Debtor to use cash collateral in which Southern
Commerce Bank, N.A., Eagle Trail Drive, LLC, as successor in
interest to Zions First National Bank, N.A., Federal Deposit
Insurance Corporation, as receiver of Heritage Bank Bank of
Florida, and Colson, as successor in interest to the United States
Small Business Association, and the Florida Business Development
Corporation assert an interest.
The Debtor will make no payments to insiders unless it is on
compliance with all other provisions of the order.
As adequate protection, the Debtor will pay to SCB on a monthly
basis accrued interest on (i) the line of credit obligation; and
(ii) the commercial loan obligation.
About Phil's Cake
Phil's Cake Box Bakeries, Inc., dba Alessi's Bakeries, Inc., is a
family-owned bakery and catering business owned and operated in
Tampa, Fla., by four generations of the Alessi family. The
operations have grown from a small bakery delivering bread by
horse and wagon, to the current 100,000 square foot manufacturing
facility serving retail customers nationwide, with a retail
location maintaining and continuing its historic traditions in
Tampa.
Alessi's operates from two locations: a manufacturing facility and
a retail bakery. The Eagle Trail manufacturing facility is located
at 5202 Eagle Trail Drive, Tampa. The Eagle Trail Facility is a
100,000 sq. ft. building which houses various production lines
including five ovens, 40,000 sq. ft. of refrigerated space with
four walk-in freezers and two coolers, and 20,000 sq. ft. of raw
material and packing supplies warehouse space. Alessi's also
operates a retail bakery facility, located at 2909 West Cypress
Street, Tampa. Alessi's owns both locations.
As of the Petition Date, Alessi's estimates that it has assets of
roughly $14.5 million and liabilities of roughly $14.7 million.
Liabilities include $5.9 million owing to Zions. There is another
$3 million owing to the Small Business Administration and $820,000
to trade suppliers.
Alessi's filed for bankruptcy to address the over-leveraging due
to the Eagle Trail Facility acquisition and the inability fully
and timely to service debt during the period in which sales
dropped.
Alessi's filed for Chapter 11 bankruptcy (Bankr. M.D. Fla. Case
No. 12-13635) on Sept. 5, 2012. Bankruptcy Judge K. Rodney May
oversees the case. Harley E. Riedel, Esq., at Stichter Riedel
Blain & Prosser, P.A., serves as the Debtor's counsel. The
petition was signed by Philip Alessi, Jr., president.
No trustee or examiner nor an official committee have yet been
appointed in the case.
POWERWAVE TECHNOLOGIES: Assets Sold; Now in Chapter 7 Liquidation
-----------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Powerwave Technologies Inc. was authorized by the
bankruptcy court in May to sell its assets to three different
buyers for a total of $16.8 million. The remainder of the
bankruptcy will be conducted by a Chapter 7 trustee, effective
June 12.
The company filed papers at the end of May reciting how there were
no more employees and no financing. Powerwave itself requested
conversion of the Chapter 11 reorganization to liquidation in
Chapter 7. The bankruptcy court granted the request June 11, and
Charles Stanziale was appointed as Chapter 7 trustee.
According to the report, the official creditors' committee
wrangled a settlement with secured lender P-Wave Holdings LLC
where $1.35 million from the remaining $2.4 million in cash on
hand will go to the lender and $1.05 million to Mr. Stanziale as
trustee.
The report notes that the cash remaining with the trustee is to
pay costs of the liquidation, including $150,000 carved out for a
trust earmarked exclusively for unsecured creditors. There will
be $250,000 to fund lawsuits, with agreement on how collections
will be shared among the lender and other creditors. The carved-
out funds include $650,000 exclusively for bankruptcy costs.
About Powerwave Technologies
Powerwave Technologies Inc. (NASDAQ: PWAV) filed for Chapter 11
bankruptcy (Bankr. D. Del. Case No. 13-10134) on Jan. 28, 2013.
Powerwave Technologies, headquartered in Santa Ana, Cal., is a
global supplier of end-to-end wireless solutions for wireless
communications networks. The Company has historically sold the
majority of its product solutions to the commercial wireless
infrastructure industry.
The Company's balance sheet at Sept. 30, 2012, showed $213.45
million in total assets, $396.05 million in total liabilities and
a $182.59 million total shareholders' deficit.
Aside from a $35 million secured debt to P-Wave Holdings LLC, the
Debtor owes $150 million in principal under 3.875% convertible
subordinated notes and $106 million in principal under 2.5%
convertible senior subordinated notes where Deutsche Bank Trust
Company Americas is the indenture trustee. In addition, as of the
Petition Date, the Debtor estimates that between $15 and $25
million is outstanding to its vendors.
The Debtor is represented by attorneys at Proskauer Rose LLP and
Potter Anderson & Corroon LLP.
Prepetition secured lender, P-Wave Holdings LLC, is represented by
Martin A. Sosland, Esq., and Joseph H. Smolinsky, Esq., at Weil
Gotshal & Manges LLP; and Mark D. Collins, Esq., and John H.
Knight, Esq., at Richards Layton & Finger.
The Official Committee of Unsecured Creditors retained Sidley
Austin LLP; Young Conaway Stargatt & Taylor LLP; and Zolfo Cooper,
LLC.
The Debtor's patent portfolio, accounts receivable, and intangible
assets were purchased by secured lender P-Wave Holdings LLC in
exchange for $10.25 million in secured debt. A consortium of
Counsel RB Capital LLC, The Branford Group and Maynards Industries
bought the machinery and equipment for $6.6 million. Teak
Capital Partners Ltd. bought affiliate Powerwave Technologies
(Thailand) Ltd. for $50,000.
PROCTOR HOSPITAL: Moody's Downgrades Long-Term Bond Rating to B2
----------------------------------------------------------------
Moody's Investors Service downgraded the long-term rating assigned
to Proctor Hospital (IL) to B2 from Ba2. This action affects the
Series 2006A Bonds (approximately $22.5 million outstanding)
issued through the Illinois Finance Authority. The hospital
remains on the Ratings under Review list for further downgrade.
Rating Rationale:
The downgrade follows a sharp drop in absolute cash and
investments, continued operating losses and declining operating
cash flow through fiscal year end (FYE) December 2012 and four
months of fiscal year (FY) 2013. The financial and operational
problems are primarily due to revenue cycle problems caused by
implementation of a new IT system. Additionally, management
reports Proctor has violated its cash-to-debt covenant on its
variable Series 2010 Bonds, a private placement through Regions
Bank, but has obtained a waiver for its covenants on known
violations that existed through March 31, 2013. In its FY 2012
audit, management disclosed it signed a memorandum of
understanding (MOU) to establish a strategic alignment with OSF
Healthcare System who will assist the organization in remaining
financially viable.
Challenges
- Absolute cash and investments dropped sharply in FY 2012 to 39
days cash on hand, 36% cash to debt and $12.0 million
unrestricted cash at FYE 2012 from 64 days cash on hand, 54%
cash to debt and unrestricted cash of $20.5 million at FYE
2011. Proctor violated its cash-to-debt covenant at September
30, 2012 with privately placed term loan agreement. Lender
Regions Bank has granted a waiver on all its known covenant
violations that existed through March 31, 2013. The decline in
cash is driven by problems with implementation of Proctor's new
IT system.
- Decline in operating performance in fiscal year (FY) 2012 to -
4.3% operating margin and 2.8% operating cash flow margin
(compared to -0.6% operating margin and 6.0% operating cash
flow margin in FY 2011), driven by IT problems and also a 7%
drop in admissions. Poor operating performance continued
through four months FY 2013 with -4.4% operating margin and
2.4% operating cash flow margin (compared to a -0.3% operating
margin and 6.8% operating cash flow margin a year earlier).
- Highly competitive Peoria market; Proctor's market share
continues to trail those of St. Francis Hospital of the OSF
Healthcare System (A3/positive outlook) and Methodist Medical
Center (A2/positive outlook and a member of Aa3 rated Iowa
Health System, now known as UnityPoint Health). Proctor is
considerably smaller than its competitors with $115 million in
total revenues (based on FY 2012 financial statements with bad
debt as a deduction from revenue) and inpatient admissions of
less than 7,000.
- Relative reliance on Medicare (49% of gross revenues in FY
2012, compared to a median of 44% for all rated hospitals),
which heightens Proctor's vulnerability to federal
reimbursement reductions in FY 2012 and beyond.
- Average of plant (19.6 years at FYE 2012) is expected to remain
elevated and nearly double the national median of 10.3 years;
capital spending fell to 0.8 times depreciation in FY 2012 and
rose to 1.4 times depreciation in FY 2011 following two years
of below 1.0 times spending.
- Defined benefit pension plan, which was frozen in 2008, remains
underfunded: at FYE 2012; plan assets equaled 64% of the $70.3
million projected benefit obligation (as compared to 61.8%
funded status in FY 2011 and $65.2 million projected
obligation).
Strengths
- Management has proactively signed a MOU to become strategically
aligned with OSF Healthcare System; executed transaction, while
months from completion, is likely to assist the organization in
remaining financially viable.
- Management has engaged outside consulting/accounting team with
expertise in improving revenue cycle problems introduced by new
health IT system.
- Relatively high acuity for a small community hospital, as
evidenced by a Medicare case mix index (CMI) of 1.42 in FY
2012.
Outlook
The negative rating outlook reflects Moody's expectation that
Proctor's financial performance will remain pressured,
particularly due to Medicare reimbursement reductions that
exacerbate Proctor's operating challenges. Moody's also believes
that balance sheet ratios will remain low, and credit quality will
continue to be vulnerable to the risks associated with variable
rate debt, particularly given the covenant violation of the term
loan agreement with Regions Bank. Furthermore, Moody's believes
Proctor's third place market position will continue in the highly
competitive the Peoria service area.
What Could Make the Rating Go Up?
While a rating upgrade is unlikely at this time, Moody's would
consider action depending on the outcome of the finalized
alignment contemplated by the MOU with OSF, a larger healthcare
system; an upgrade for Proctor as a standalone hospital would
require significant and sustained improvement in operating
performance and cash position; ability to address ongoing capital
needs without adversely affecting balance sheet measures; patient
volume growth that leads to increased market share and operating
revenues to levels consistent with higher rating categories
What Could Make the Rating Go Down?
Further weakening of balance sheet ratios and/or operating
performance; expiration of covenant waiver from Regions Bank
without improvement in liquidity; decreased market share that
materially affects patient volumes and operating revenues;
inability to offset reductions in Medicare reimbursement;
inability to manage capital needs without significantly impairing
cash and/or debt levels
The principal methodology used in this rating was Not-for-Profit
Healthcare Rating Methodology published in March 2012.
RAINMAKER SYSTEMS: NASDAQ to Delist Common Stock Today
------------------------------------------------------
Rainmaker Systems, Inc. on June 12 disclosed that it received
notice from the NASDAQ Stock Market on June 11, 2013, that the
NASDAQ Hearings Panel has determined to delist the Company's
shares from NASDAQ effective at the opening of business today,
June 13, 2013. On that same date, the Company's common stock will
become eligible to trade on the OTCQB, which is an electronic
trading platform of the OTC Markets Group. The Company's trading
symbol will remain RMKR. As of that date, investors and other
interested parties will be able to view the Real Time Level II
stock quotes for RMKR at http://www.otcmarkets.com
As previously disclosed, the Company faced delisting due to
violation of Listing Rule 5550(b)(1) because its stockholders'
equity had fallen below the required minimum of $2.5 million. Due
to the Panel not having sufficient information to conclude that
the Company will regain compliance before the applicable deadline,
the Panel has decided to delist the Company's stock.
The Company plans to appeal the Panel's decision to the NASDAQ
Listing and Hearing Review Council.
The move to the OTCQB does not alter the Company's SEC reporting
obligations under applicable securities laws. Accordingly, the
Company will continue to file its Quarterly Reports on Form 10-Q,
Annual Reports on Form 10-K and Current Reports on Form 8-K.
About Rainmaker Systems, Inc.
Rainmaker Systems, Inc. is a Commerce-as-a-Service (CaaS) company
that helps large enterprises gain greater market share and
increased brand awareness for cloud-based or on-premise based
product offerings in the worldwide SMB market. Rainmaker does
this with an advanced e-Commerce open architecture SaaS platform
that easily integrates cloud-based applications and on-premise
applications with its Global Commerce Services to provide its
clients with a strategic partnership, quick market entry, and
rapid growth.
READER'S DIGEST: Taps KPMG as Fresh Start Accountants
-----------------------------------------------------
RDA Holding Co., The Reader's Digest Association, Inc., and their
debtor-affiliates seek authority from the U.S. Bankruptcy Court
for the Southern District of New York to employ KPMG LLP as their
fresh start accountants.
As fresh start accountants, KPMG will, among other things, work
closely with the Debtors' advisors and external auditors
throughout the engagement and assist the Debtors with researching
and extracting existing financial information needed for
substantiated responses to valid requests of third parties; and
assist in the preparation of financial documents which may include
monthly operating reports and plan of reorganization.
KPMG will be paid $570 per hour for partner and managing director,
$480 for director, $305 for manager, $225 per hour for staff, and
$85 per hour paraprofessionals, and reimbursed for any necessary
out-of-pocket expenses.
Erik M. Lange, a partner of KPMG, assures the Court that his firm
is a "disinterested person" as defined in Section 101(14) of the
Bankruptcy Code and does not represent any interest adverse to the
Debtors and their estates.
The employment application will be presented in Court for approval
on June 18, 2013, at 12:00 noon (Eastern Time). Objections are
due June 17.
Marcia L. Goldstein, Esq., and Joseph H. Smolinsky, Esq., at Weil,
Gotshal & Manges LLP, in New York, filed the employment
application on behalf of the Debtors.
About Reader's Digest
Reader's Digest is a global media and direct marketing company
that educates, entertains and connects consumers around the world
with products and services from trusted brands. For more than 90
years, the flagship brand and the world's most read magazine,
Reader's Digest, has simplified and enriched consumers' lives by
discovering and expertly selecting the most interesting ideas,
stories, experiences and products in health, home, family,
food, finance and humor.
RDA Holding Co. and 30 affiliates (Bankr. S.D.N.Y. Lead Case No.
13-22233) filed for Chapter 11 protection on Feb. 17, 2013,
with an agreement with major stakeholders for a pre-negotiated
chapter 11 restructuring. Under the plan, the Debtor will issue
the new stock to holders of senior secured notes.
RDA Holding Co. listed total assets of $1,118,400,000 and total
liabilities of $1,184,500,000 as of the Petition Date.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Evercore Group LLC is the investment banker. Epiq
Bankruptcy Solutions LLC is the claims and notice agent.
Reader's Digest, together with its 47 affiliates, first sought
Chapter 11 protection (Bankr. S.D.N.Y. Case No. 09-23529) Aug. 24,
2009 and exited bankruptcy Feb. 19, 2010.
Under the Plan, holders of allowed general unsecured claims in
such sub-class will receive their pro rata share of the GUC
distribution; holders of allowed general unsecured claims of
Reader's Digest will also receive their pro rata share of the RDA
GUC distribution and the senior noteholder deficiency claims in
such sub-class will be deemed waived solely for purposes of
participating in the GUC distribution and the RDA GUC
distribution.
The Official Committee of Unsecured Creditors is represented by
Otterbourg, Steindler, Houston & Rosen, P.C. The Committee tapped
Alvarez & Marsal North America, LLC, as financial advisors.
RESIDENTIAL CAPITAL: RFC Resolves Dispute with MortgageIT
---------------------------------------------------------
Debtor Residential Funding Company, LLC, was formerly engaged in
the business of purchasing residential mortgage loans.
MortgageIT, Inc., was previously engaged in the business of
originating, processing, underwriting, closing and selling
residential mortgage loans.
MortgageIT and RFC are parties to a Client Contract dated July 28,
2003, which sets forth the terms and conditions for sales to RFC
of residential mortgage loans originated by MortgageIT.
Prior to the Petition Date, RFC alleged that MortgageIT defaulted
under the terms of the Contract, including, among other things, by
breaching one or more representations and warranties related to
the sale of three loans to RFC and asked that MortgageIT
repurchase or make RFC whole for losses related to the Subject
Loans pursuant to the Contract. MortgageIT disputed RFC's
Repurchase Claim pursuant to the Contract.
The parties, prior to the Petition Date, negotiated a settlement
under which MortgageIT agreed to pay RFC $200,000 in settlement of
RFC's Repurchase Claim in one lump sum payment on or before May
11, 2012.
As of June 4, 2013, MortgageIT has not made the Settlement
Payment.
In January this year, RFC commenced an action against MortgageIT
in the United States District Court for the District of Minnesota,
styled as Residential Funding Company, LLC v. MortgageIT, Inc.,
Case No. 0:13-cv-00189-PAM-SER, seeking to compel MortgageIT's
performance under the Settlement Agreement. MortgageIT contends
that as a consequence of the commencement of the bankruptcy cases
RFC may be unauthorized to consummate the Settlement Agreement
without an Order of the Court.
Under the stipulation, MortgageIT agreed to immediately pay
$200,000 to RFC in exchange for the dismissal of the Minnesota
Action.
Norman S. Rosenbaum, Esq., and Gary S. Lee, Esq., at Morrison &
Foerster LLP, in New York, for the Debtors. Steven Wilamowsky,
Esq., at Bingham McCutchen LLP, in New York, for MortgageIT, Inc.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
ResCap sold most of the businesses for a combined $4.5 billion.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: NJ Carpenters' Class Suit Bid Adjourned
------------------------------------------------------------
The hearing on New Jersey Carpenters Health Fund's motion for
order certifying class for purposes of its class claim is
adjourned to July 10, 2013, at 10:00 a.m. (ET), before Judge
Martin Glenn of the U.S. Bankruptcy Court for the Southern
District of New York. Objections are due July 3.
The U.S. District Court for the Southern District of New York on
January 3, 2013, entered a revised order certifying the proposed
class in the lawsuit filed by NJ Carpenters Health Fund against
Residential Capital LLC, et al. The Certified Class is defined as
"initial purchasers who bought the securities directly from the
underwriters or their agents no later than ten trading days after
the offering date."
The NJ Carpenters Health Fund subsequently filed a motion for
class certification with the Bankruptcy Court for purposes of
filing class claims.
The Lead Plaintiff filed separate class proofs of claims against
each of Debtors Residential Capital, LLC, Residential Funding
Company, LLC, and Residential Accredit Loans, Inc., for damages
resulting from violations of Sections 11, 12(a) and 15 of the
Securities Act of 1933, Sections 77K, 71(a)(2) and 77o of Title 15
of the U.S. Code, in connection with the purchase of the subject
mortgage-backed securities certificates and the Debtors' conduct
in connection to the securitization deals.
The class action lawsuit is New Jersey Carpenters Health Fund,
et als. v. Residential Capital, LLC, et al.
The Lead Plaintiff is represented by Ira M. Levee, Esq., and
Michael S. Etkin, Esq., at Lowenstein Sandler LLP, in New York;
and Joel P. Laitman, Esq., Christopher Lometti, Esq., and Michael
B. Eisenkraft, Esq., at Cohen Milstein Sellers & Toll PLLC, in New
York.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
ResCap sold most of the businesses for a combined $4.5 billion.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: Denial of Papas Conversion Bid Upheld
----------------------------------------------------------
Judge Naomi Reice Buchwald of the U.S. District Court for the
Southern District of New York denied Paul N. Papas II's appeal
from the Bankruptcy Court's order denying his motion to convert
Residential Capital LLC's Chapter 11 case to Chapter 7.
Judge Buchwald found that the Appellant has not shown any reason,
legal or otherwise, to warrant a reversal of the Bankruptcy
Court's denial of Mr. Papas' motion to convert. Judge Buchwald
also denied Mr. Papas' motion to seize all assets belonging to
ResCap is dismissed for lack of jurisdiction.
The case is Paul N. Papas, II, Appellant, v. Residential Capital,
LLC, Appellee, Case No. 12-12020 (S.D.N.Y.).
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
ResCap sold most of the businesses for a combined $4.5 billion.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: Calif. Court Junks "Panaszewicz" Suit
----------------------------------------------------------
Magistrate Judge Maria-Elena James of the United States District
Court for the Northern District California granted GMAC Mortgage,
LLC, and Residential Funding Company, LLC's motion to dismiss a
complaint for promissory estoppels filed by Martha Panaszewicz
seeking to annul the sale of her home and seeking damages as a
result of the sale.
Judge James found that, based on certain pleading deficiencies,
the Plaintiff has failed to state a plausible promissory estoppel
claim.
The Plaintiff, according to Judge James, has not set forth any
facts indicating that she notified any of the Defendants'
representatives that she intended to pursue legal action to
protect her property, but was electing not to do so because the
Plaintiff believed the sale was to be postponed. Thus, there are
no facts indicating that the Defendants were aware of the
Plaintiff's reliance on one of their representative's alleged
promise which would suggest that her reliance was reasonable and
foreseeable to the Defendants.
The case is MARTHA PANASZEWICZ, Plaintiff, v. GMAC MORTGAGE, LLC;
RESIDENTIAL FUNDING COMPANY, LLC, Defendants, No. C 13-01162 MEJ
(N.D. Cal.). A full-text copy of the Decision is available at
http://is.gd/wRPANffrom Leagle.com.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
ResCap sold most of the businesses for a combined $4.5 billion.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: N.C. Court Recommends "Wilson" Suit Dismissal
------------------------------------------------------------------
The Hon. L. Patrick Auld, Magistrate Judge for the U.S. District
Court for the Middle District of North Carolina, signed off a
memorandum opinion and recommendation granting the defendants'
motion to dismiss an action titled The case is JENNIFER L. WILSON,
Plaintiff, v. SUNTRUST BANK, et al., Defendants, No. 1:11CV390
(M.D.N.C.).
The action arises primarily out of the foreclosure of the
Plaintiff's residence. The Plaintiff, proceeding pro se, filed a
complaint against SunTrust Bank, SunTrust Mortgage, Inc.,
Residential Funding Company, LLC, The Law Firm of Hutchens, Senter
& Britton, P.A., Substitute Trustee Services, Inc., Jennifer F.
Thomas, and Does 1-10. The Defendants filed motions to dismiss
the complaint for, among others, lack of subject matter
jurisdiction over the claims against them because they do not
present a federal question and supplemental jurisdiction should
not apply.
Judge Auld found that the Court lacks jurisdiction over all but
the Plaintiff's sixth cause of action -- "breach of covenant"
alleging that RFC failed to notify the Plaintiff of the transfer
of certain servicing responsibilities. Because a finding for the
Plaintiff on her third, fourth, or seventh causes of action would
require the Court to find that "the state court wrongly decided
the foreclosure action," the Rooker-Feldman doctrine bars the
Court from hearing those claims, Judge Auld said. The Complaint
otherwise fails to state a claim with respect to the first,
second, and fifth causes of action as well as against Does 1-10.
With respect to the Plaintiff's cause of action against RFC, it
should be stayed in light of RFC's bankruptcy filing, Judge Auld
ruled.
A full-text copy of Judge Auld's Decision dated May 23, 2013, is
available at http://is.gd/ZL2NRhfrom Leagle.com.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
ResCap sold most of the businesses for a combined $4.5 billion.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
ROTECH HEALTHCARE: Equity Panel Objects to Disclosure Statement
---------------------------------------------------------------
The Official Committee of Equity Security Holders appointed in the
Chapter 11 cases of Rotech Healthcare, Inc., et al., objects to
the disclosure statement explaining the Debtors' first amended
joint plan of reorganization.
Specifically, the Equity Committee complains that the valuation
analysis underpinning the Plan's proposed debt-to-equity
conversion in favor of the Debtors' second lien noteholders
contains several material omissions and defects, primarily the
exclusion from the Debtors' financial projections of revenues from
a five-year $68.3 million contract recently awarded to the Company
by the U.S. Department of Veterans Affairs. The VA Contract
admittedly adds incremental earnings before interest, taxes,
depreciation and amortization (EBITDA) of approximately $9 million
in 2014 alone and $23.2 million in the aggregate through 2015.
While the Debtors allege that the omission is due to a pending
challenge to the award of the VA Contract, they fail to disclose
that revenues from the VA Contract were accounted for in financial
projections prepared by management in April 2013, the Equity
Committee argues. More egregiously, the Debtors fail to disclose
that the pending challenge must be concluded under statute by
June 26, 2013.
About Rotech Healthcare
Based in Orlando, Florida, Rotech Healthcare Inc. (NASDAQ: ROHI)
-- http://www.rotech.com/-- provides home medical equipment and
related products and services in the United States, with a
comprehensive offering of respiratory therapy and durable home
medical equipment and related services. The company provides
equipment and services in 48 states through approximately 500
operating centers located primarily in non-urban markets.
The Company reported a net loss of $14.76 million in 2011, a net
loss of $4.20 million in 2010, and a net loss of $21.08 million
in 2009.
The Company's balance sheet at Sept. 30, 2012, showed
$255.76 million in total assets, $601.98 million in total
liabilities, and a $346.22 million total stockholders' deficiency.
On April 8, 2013, Rotech Healthcare and 114 subsidiary companies
filed petitions seeking relief under chapter 11 of the Bankruptcy
Code (Bankr. D. Del. Lead Case No. 13-10741) to implement a pre-
arranged plan negotiated with secured lenders.
Attorneys at Proskauer Rose LLP, and Young, Conaway, Stargatt &
Taylor serve as counsel to the Debtors; Foley & Lardner LLP is the
healthcare regulatory counsel; Akin Gump Strauss Hauer & Feld LLP
is the special healthcare regulatory counsel; Barclays Capital
Inc. is the financial advisor; Alix Partners, LLP is the
restructuring advisor; and Epiq Bankruptcy Solutions LLC is the
claims agent.
Prepetition term loan lender and DIP lender Silver Point Capital
and other consenting noteholders are represented by Wachtell,
Lipton, Rosen & Katz, and Richards Layton & Finger PA.
The U.S. Trustee at the end of April appointed an official
committee of equity holders. Members include Alden Global
Recovery Master Fund LP, Varana Capital Master LP, Wynnefield
Partners Small Cap Value LP I, Bastogne Capital Partners, LP, and
Kenneth S. Grossman P.C. Pension Plan.
The plan is supported by holders of a majority of the first- and
second-lien secured notes. The $290 million in 10.5 percent
second-lien notes are to be exchanged for the new equity. Trade
suppliers are to be paid in full, if they agree to continue
providing credit. The existing $23.5 million term loan would be
paid in full, and the $230 million in 10.75 percent first-lien
notes will be amended.
The Official Committee of Unsecured Creditors tapped Otterbourg,
Steindler, Houston & Rosen, P.C., as counsel; Buchanan Ingersoll &
Rooney PC as Delaware counsel; and Grant Thornton LLP as financial
advisor.
ROTECH HEALTHCARE: Proposes to Employ Protiviti as Auditor
----------------------------------------------------------
Rotech Healthcare Inc. and its debtor affiliates seek authority
from the U.S. Bankruptcy Court for the District of Delaware to
retain and employ Protiviti, Inc., as internal auditor and
internal control consultants.
The internal audit services are expected to include the following:
a. Internal audit function project management, including
reporting directly to the Rotech Audit Committee and
administratively to the Chief Financial Officer;
b. Review of the audit work completed by the existing Rotech
internal audit staff as outlined in the Rotech's annual
Internal Audit plan; and
c. Assistance to management with overseeing the annual review
and assessment of key financial processes and with
conducting the annual review and assessment of key
Information Technology processes and controls in accordance
with Sarbanes-Oxley 404.
Protiviti will be paid an estimated fee for the internal audit
services of approximately $326,900 plus expenses, of which
approximately $30,068, was invoiced and paid prior to the Petition
Date. Any additional related internal audit and internal control
services requested beyond the scope of services specifically
identified in the Statement of Work will be billed at the
following hourly rates:
Level Hourly Rate
----- -----------
Intern $75
Consultant $100
Senior Consultant $130
Manager $160
Senior Manager $180
Associate Director $200
Director $280
Managing Director $305
Phillip Z. Fretwell, a Managing Director with Protiviti, assures
the Court that his firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code and does not
represent any interest adverse to the Debtors and their estates.
Mr. Fretwell also discloses that Protiviti has provided
prepetition internal audit and internal control consulting
services to the Debtors. Protiviti received approximately
$115,301 from the Debtors in the 90 days prior to the Petition
Date.
A hearing on the employment application will be held on July 15,
2013, at 10:00 a.m. (ET). Objections are due June 18.
About Rotech Healthcare
Based in Orlando, Florida, Rotech Healthcare Inc. (NASDAQ: ROHI)
-- http://www.rotech.com/-- provides home medical equipment and
related products and services in the United States, with a
comprehensive offering of respiratory therapy and durable home
medical equipment and related services. The company provides
equipment and services in 48 states through approximately 500
operating centers located primarily in non-urban markets.
The Company reported a net loss of $14.76 million in 2011, a net
loss of $4.20 million in 2010, and a net loss of $21.08 million
in 2009.
The Company's balance sheet at Sept. 30, 2012, showed
$255.76 million in total assets, $601.98 million in total
liabilities, and a $346.22 million total stockholders' deficiency.
On April 8, 2013, Rotech Healthcare and 114 subsidiary companies
filed petitions seeking relief under chapter 11 of the Bankruptcy
Code (Bankr. D. Del. Lead Case No. 13-10741) to implement a pre-
arranged plan negotiated with secured lenders.
Attorneys at Proskauer Rose LLP, and Young, Conaway, Stargatt &
Taylor serve as counsel to the Debtors; Foley & Lardner LLP is the
healthcare regulatory counsel; Akin Gump Strauss Hauer & Feld LLP
is the special healthcare regulatory counsel; Barclays Capital
Inc. is the financial advisor; Alix Partners, LLP is the
restructuring advisor; and Epiq Bankruptcy Solutions LLC is the
claims agent.
Prepetition term loan lender and DIP lender Silver Point Capital
and other consenting noteholders are represented by Wachtell,
Lipton, Rosen & Katz, and Richards Layton & Finger PA.
The U.S. Trustee at the end of April appointed an official
committee of equity holders. Members include Alden Global
Recovery Master Fund LP, Varana Capital Master LP, Wynnefield
Partners Small Cap Value LP I, Bastogne Capital Partners, LP, and
Kenneth S. Grossman P.C. Pension Plan.
The plan is supported by holders of a majority of the first- and
second-lien secured notes. The $290 million in 10.5 percent
second-lien notes are to be exchanged for the new equity. Trade
suppliers are to be paid in full, if they agree to continue
providing credit. The existing $23.5 million term loan would be
paid in full, and the $230 million in 10.75 percent first-lien
notes will be amended.
The Official Committee of Unsecured Creditors tapped Otterbourg,
Steindler, Houston & Rosen, P.C., as counsel; Buchanan Ingersoll &
Rooney PC as Delaware counsel; and Grant Thornton LLP as financial
advisor.
SANUWAVE HEALTH: Issues $300,000 Promissory Notes
-------------------------------------------------
SANUWAVE Health, Inc., issued promissory notes, in the aggregate
principal amount of $300,000, between May 14, 2013, and June 6,
2013, to certain existing shareholders.
The Notes accrue interest at a rate of 18 percent per annum. The
Notes, together with all accrued and unpaid interest, are due and
payable 179 days from their individual issuance date. In the
event that the Notes are not paid in full within three business
days of their respective maturity dates, then, from and after that
maturity date and until payment in full, interest will accrue on
the outstanding principal balance of the Notes at the rate of 25
percent per annum. Pursuant to the terms of the Notes, the
Company agreed to pay all costs and expenses of collection on the
Notes. The Notes are unsecured.
David N. Nemelka, the brother of John F. Nemelka, who is a member
of the Company's board of directors, purchased Notes in the
offering in the principal amount of $100,000.
About SANUWAVE Health
Alpharetta, Ga.-based SANUWAVE Health, Inc., is an emerging global
regenerative medicine company focused on the development and
commercialization of noninvasive, biological response activating
devices for the repair and regeneration of tissue, musculoskeletal
and vascular structures.
BDO USA, LLP, in Atlanta, Georgia, 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 a net
working capital deficit, and is economically dependent upon future
issuances of equity or other financing to fund ongoing operations,
each of which raise substantial doubt about its ability to
continue as a going concern.
SANUWAVE Health reported a net loss of $6.40 million on $769,217
of revenue for the year ended Dec. 31, 2012, as compared
with a net loss of $10.23 million on $802,572 of revenue in 2011.
The Company's balance sheet at March 31, 2013, showed $2.33
million in total assets, $13.64 million in total liabilities and a
$11.31 million total stockholders' deficit.
SCHOOL SPECIALTY: Consummates Plan; Lenders Become New Owners
-------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that School Specialty Inc. implemented the Chapter 11
reorganization plan on June 11. The bankruptcy judge in Delaware
approved the Plan by signing a confirmation order on May 23.
According to the report, the plan gave 87.5 percent of the
reorganized company's stock to lenders who provided $155 million
in replacement financing, for a predicted full recovery.
Noteholders 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.
SCHOOL SPECIALTY: Bowery Buys Atradius' $2 Million Claim
--------------------------------------------------------
Atradius Trade Credit Insurance Inc. assigned its claim no. 1614
filed in the Chapter 11 case of School Specialty Inc., to Bowery
Opportunity Fund, which may be reached at:
BOWERY OPPORTUNITY FUND LP
1325 Avenue of the Americas, 28th Floor
New York, NY 10019
Attn: Vladimir Jelisavcic
The claim is for $2,018,401.
The parties did not disclose the price Bowery paid for the claim.
Mr. Jelisavcic co-founded Longacre Fund Management, a distressed-
debt investor that moved to wind down its main funds in 2011. Mr.
Jelisavcic started Longacre in 1999 with two other former Bear
Stearns traders.
Bowery's Investor Relations may be reached at:
Joshua Spindel
Bowery Investment Management, LLC
1325 Avenue of the Americas, 28th Floor
New York, NY 10019
Tel: 212-259-4329
Fax: 212-259-4347
E-mail: jspindel@boweryim.com
http://www.boweryim.com/
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.
School Specialty on May 23 disclosed that the Bankruptcy Court
entered an order confirming the Company's Second Amended Joint
Plan of Reorganization. Under the Plan, School Specialty will
reduce its total debt obligations by half and enable the Company
to secure $320 million in new financing.
Existing common stock will be extinguished under the Plan, and no
distributions will be made to holders of the Company's current
equity. New common stock with voting rights will be issued to the
Company's current noteholders and Ad Hoc DIP lenders.
SEA TRAIL: July 11 Hearing on Motion to Dismiss Chapter 11 Case
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of North
Carolina continued until July 11, 2013, at 10 a.m., the hearing to
consider the motion to dismiss case filed by Parker Worth Rumley
on behalf of the Bankruptcy Administrator.
As reported by the Troubled Company Reporter on May 28, 2013, the
Bankruptcy Administrator explained that the Debtor has the
inability to effectuate substantial consummation of a confirmed
plan.
The Bankruptcy Administrator notes that the Court entered an order
confirming the Plan on Oct. 23, 2012, and entered an amended order
confirming the Plan on Dec. 3, 2012. The Effective Date was
contingent upon a sale that has not occurred.
About Sea Trail Corporation
Sunset Beach, North Carolina-based Sea Trail Corporation owns and
operates the Sea Trail Golf Resort and Conference Center. The
Debtor's business operations are comprised of three operating
divisions, including the golf division, the convention and resort
division, and the real estate division.
Sea Trail filed a Chapter 11 petition (Bankr. E.D.N.C. Case No.
11-07370) on Sept. 27, 2011, in Wilson, North Carolina. The
Debtor reported $34,222,281 in assets and $22,174,201 in
liabilities as of the Chapter 11 filing. Stubbs & Perdue P.A. is
the Debtors' attorney. McIntyre, Paradis, Wood & Company CPA's
PLLC is the Debtor's accountants. The Finley Group, Inc., is the
Debtor's financial consultant.
Sea Trail Corporation's official committee of unsecured creditors
retained J.M. Cook and his firm, J.M. Cook, P.A., as counsel.
In October 2012, Bankruptcy Judge Stephani W. Humrickhouse
confirmed the First Amended Plan of Reorganization that Sea Trail
filed on Sept. 20, 2012.
SEA TRAIL: Cienda Offers $6 Million for Resort Assets
-----------------------------------------------------
Sea Trail Corporation intends to test a $6 million offer for its
resort property at a June 17 auction, according to bidding and
sale procedures proposed last month.
Sea Trail has asked the U.S. Bankruptcy Court for the Eastern
District of North Carolina to approve the procedures for the sale
of the Debtor's principal assets -- a golf resort and convention
center known as the Sea Trail Golf Resort and Convention Center.
The Debtor attempted to sell the property in 2012, however, it was
unsuccessful with those efforts. In early 2013, the Debtor
located a new purchaser who has agreed to purchase the property as
a stalking horse bidder. Pursuant to a Purchase and Sale
Agreement, Cienda Management LLC or its assigns agreed to purchase
the assets for $6 million. Cienda has deposited a $1 million
earnest money deposit.
Bid packages were due no later than 5:00 p.m. EST on June 12,
2013, according to the proposed procedures.
Potential purchasers who have executed the required form
of NDA will be entitled to conduct any due diligence of the
property at any time prior to the date scheduled for the
competitive sale, and the Debtor will cooperate with all
reasonable requests for information and access prior to that time.
The bid procedures include, among other things:
Bid Deadline: 5 p.m. on June 12
Auction: 10 a.m. on June 17, at the
offices of Ward & Smith, P.A.,
Wade II, Suite 400, 5430 Wade
Park Boulevard, Suite 400,
Raleigh, North Carolina
Breakup Fee: $400,000
Final Sale Hearing: June 18, at 10:30 a.m.
A copy of the terms of the bid procedures is available for free at
http://bankrupt.com/misc/SEATRAIL_sale.pdf
About Sea Trail Corporation
Sunset Beach, North Carolina-based Sea Trail Corporation owns and
operates the Sea Trail Golf Resort and Conference Center. The
Debtor's business operations are comprised of three operating
divisions, including the golf division, the convention and resort
division, and the real estate division.
Sea Trail filed a Chapter 11 petition (Bankr. E.D.N.C. Case No.
11-07370) on Sept. 27, 2011, in Wilson, North Carolina. The
Debtor reported $34,222,281 in assets and $22,174,201 in
liabilities as of the Chapter 11 filing. Stubbs & Perdue P.A. is
the Debtors' attorney. McIntyre, Paradis, Wood & Company CPA's
PLLC is the Debtor's accountants. The Finley Group, Inc., is the
Debtor's financial consultant.
Sea Trail Corporation's official committee of unsecured creditors
retained J.M. Cook and his firm, J.M. Cook, P.A., as counsel.
In October 2012, Bankruptcy Judge Stephani W. Humrickhouse
confirmed the First Amended Plan of Reorganization that Sea Trail
filed on Sept. 20, 2012.
SEANERGY MARITIME: Has Cut Indebtedness to $176.9 million
---------------------------------------------------------
Seanergy Maritime Holdings Corp. on June 12 reported financial
results for the first quarter ended March 31, 2013.
Financial Highlights:
First Quarter 2013
-- Net Revenues of $5.6 million.
-- EBITDA of $3.8 million.*
-- Net Income of $1.1 million.
-- Debt reduction of $31.8 million, or approximately 15%
of the Company's outstanding indebtedness.
(*) EBITDA is a non-GAAP measure. Please refer to the EBITDA,
Adjusted EBITDA and Adjusted Net Income/Loss reconciliation
section contained in this press release.
Management Discussion:
Stamatis Tsantanis, the Company's Chief Executive Officer, stated:
"I am pleased to announce our first profitable financial quarter
since 2011, despite the challenging dry bulk market conditions.
Our net income was $1.1 million compared to a net loss of $6.4
million for the same period last year. During the first quarter
of 2013 charter rates continued to deteriorate and our average
daily Time Charter Equivalent ("TCE") rate decreased to $6,004 per
vessel as compared to $9,546 in the first quarter of 2012.
"Regarding our financial restructuring, since the beginning of
2012 and as of the date of this press release, we managed to
reduce our indebtedness to $176.9 million, from $346.4 million,
through finalized agreements with three out of our five lenders.
In addition, we have entered into an agreement with our fourth
lender for the sale of three MCS's vessel owning subsidiaries in
exchange for a nominal cash consideration and full satisfaction of
the underlying loan of approximately $38 million. After giving
effect to this transaction, we will have reduced our indebtedness
by approximately 61% to $135 million. We continue discussions
with our remaining lender, aiming to reach a solution that will
enable Seanergy to complete the restructuring of its outstanding
debt."
Christina Anagnostara, the Company's Chief Financial Officer,
stated:
"During the first quarter of 2013, net revenues were $5.6 million,
68% lower than in the same period in 2012 reflecting the smaller
size of our fleet and a 37% reduction of the daily TCE.
"For the first quarter of 2013, net income amounted to $1.1
million compared to a net loss for the first quarter of 2012 of
$6.4 million. After adjusting for $5.5 million gain on the sales
of four vessel owning subsidiaries and $0.9 million loss on vessel
impairment, Seanergy's net loss was $3.6 million compared to a net
loss of $4 million in the first quarter of 2012 after adjusting
for $2.3 million loss on sale of vessels. The reduction reflects
the significant decrease in interest and finance costs to $2.2
million from $3.4 million in 2012.
We continue our efforts to achieve a viable financial structure
that will facilitate Seanergy's ability to benefit from the
eventual rebound in shipping markets. We believe that the recent
sale of our four Handysize owning subsidiaries and the forthcoming
sale of three additional Handysize owning subsidiaries, in full
satisfaction of the associated loan facilities, are positive for
Seanergy as they are expected to bring our total indebtedness down
to approximately $135 million."
First Quarter 2013 Financial Results:
Net Revenues
Net revenues for the first quarter of 2013 decreased to $5.6
million from $17.4 million in the same quarter of 2012. The
decrease of 68% in net revenues reflects lower freight rates
earned in the dry bulk market as compared to the same quarter last
year, as well as a 57% reduction in operating days that resulted
from the sale of vessel owning subsidiaries.
EBITDA and Adjusted EBITDA
Adjusted EBITDA was negative $0.8 million for the first quarter of
2013, excluding $5.5 million of gains resulting from the sales of
subsidiaries and $0.9 million of non-cash impairment losses
associated with the African Oryx sale. Including the
aforementioned items, EBITDA stands positive at $3.8 million. For
the first quarter of 2012, Seanergy recorded Adjusted EBITDA of
$4.9 million, while EBITDA was $2.5 million.
For more information please refer to the EBITDA, Adjusted EBITDA
and Adjusted Net Loss/Income reconciliation section contained in
this press release.
Net Income/Loss
For the first quarter of 2013, net income amounted to $1.1 million
or $0.09 per basic and diluted share, as compared to a net loss
for the first quarter of 2012 of $6.4 million, or $0.54 per basic
and diluted share, based on weighted average common shares
outstanding of 11,958,063 basic and 11,959,282 diluted for the
first quarter of 2013, and 11,803,933 basic and diluted for the
first quarter of 2012.
For the first quarter of 2013, adjusted net loss excluding gains
from the sales of subsidiaries and non-cash impairment losses was
$3.6 million, as compared to an adjusted net loss of $4.0 million
in 2012.
Debt Reduction
Seanergy ended the first quarter of 2013 with $176.9 million of
outstanding debt. This reflects the reduction of our outstanding
indebtedness by $31.8 million, during the three month period ended
March 31, 2013.
First Quarter 2013 Developments:
Sale of Subsidiaries in Satisfaction of DVB Loan
On January 29, 2013, Seanergy's subsidiary, Maritime Capital
Shipping Limited ("MCS"), sold its 100% ownership interest in the
four companies that owned the Handysize dry bulk vessels Fiesta,
Pacific Fantasy, Pacific Fighter and Clipper Freeway for a nominal
consideration. In exchange for the sale, approximately $30.3
million of outstanding debt was discharged.
The buyer was a third-party nominee of the lenders under the
senior secured credit facility with DVB Merchant Bank (Asia) Ltd.,
as agent.
In connection to the sale, the Company's Board of Directors
obtained a fairness opinion from an independent third party.
Impairment of African Oryx
The Company assessed the recoverability of the carrying value,
including unamortized deferred dry docking costs, of the vessel
African Oryx due to its sale in the second quarter of 2013 and, as
a result, recognized an impairment loss of $0.9 million.
Subsequent Events:
Sale of African Oryx
On April 10, 2013, Seanergy sold the African Oryx, a 24,112 DWT
Handysize vessel built in 1997. Gross proceeds amounted to $4.1
million and were used to repay debt.
Receipt of NASDAQ Notice
The Company received a written notification from the Nasdaq
Capital Market, dated May 1, 2013, indicating that the Company is
not in compliance with the requirement to maintain a minimum of
$2.5 million in stockholders' equity for continued listing on the
Capital Market, pursuant to Nasdaq Listing Rule 5550(b)(1). The
Company reported negative stockholders' equity of $101.6 million
for the fiscal year ended December 31, 2012. In addition, as of
April 30, 2013, the Company did not meet the alternative standards
for continued listing, including a market value of listed
securities of at least $35 million, pursuant to Nasdaq Listing
Rule 5550(b)(2), or net income from continuing operations of at
least $500,000, pursuant to Nasdaq Listing Rule 5550(b)(3).
In order to cure this deficiency, the Company must submit a plan
to Nasdaq to regain compliance by June 17, 2013. If the plan is
accepted by Nasdaq, the Company may be granted a grace period to
regain compliance of up to 180 days, expiring on or before October
28, 2013.
The Company is currently preparing a comprehensive plan that will
be submitted to Nasdaq in order to regain compliance with the
continued listing standards of the Capital Market.
Agreement for the Sale of Subsidiaries in Satisfaction of UOB Loan
On May 6, 2013, Seanergy's subsidiary, MCS, entered into an
agreement with its fourth lender (United Overseas Bank) for the
sale of three vessel owning subsidiaries that own the Handysize
vessels African Joy, African Glory and Asian Grace, in exchange
for a nominal cash consideration and full satisfaction of the
underlying loan. The sale is subject to final documentation and
is expected to close within the second quarter of 2013 or any
other date as may be agreed between the Company and the lender.
Upon the closing of the transaction approximately $38 million of
the Company's outstanding debt will be discharged and the
guarantee provided by MCS will be fully released.
Prior to the sale of the shares, the Company's Board of Directors
will obtain a fairness opinion from an independent third party.
Ability to Continue as a Going Concern
Over the past year and as of the date of this press release, the
Company has experienced significant losses and reduction in cash
which has affected its ability to satisfy its obligations due to
shipping sector volatility and economic difficulties. The Company
experienced significant reduction in cash flow, as it had to re-
charter its vessels at low prevailing rates.
As a result of the above, the Company defaulted under its loan
agreements in respect of certain covenants (including, in some
cases, the failure to make principal and interest payments, the
failure to satisfy financial covenants and the triggering of cross
default provisions). To date, the Company has not obtained
waivers of all these defaults from its lenders. Since January 1,
2012, the Company has sold or otherwise disposed a total of 13
vessels (or the ownership of certain of its vessel owning
subsidiaries) and it has entered into an agreement to sell three
additional vessel owning subsidiaries in connection with its debt
restructuring. Proceeds from the sale of remaining vessels are
expected to be insufficient to fully repay the related debt and,
therefore, it is likely that the Company will continue to have
significant debt unless it enters into satisfactory arrangements
with its lenders for the discharge of all such obligations.
During the restructuring process, the lenders have continued to
reserve their rights in respect of events of default under the
loan agreements. The lenders have not exercised their remedies at
this time, including demand for immediate payment. The lenders,
however, could change their position at any time. As such, there
can be no assurance that a satisfactory final agreement will be
reached with the lenders in the restructuring, or at all.
While the Company continues to use its best efforts to restructure
the debt of its remaining lender, there can be no assurance that
the negotiations will be successful or that it will obtain waivers
or amendments from its lender. Failure to obtain such waivers or
amendments could materially and adversely affect the Company's
business and operations. Furthermore, the impact of the final
terms of any restructuring is uncertain. Due to the above, the
Company's $176.9 million outstanding debt as of March 31, 2013 is
classified as current.
Athens, Greece-based Seanergy Maritime Holdings Corp. is an
international company providing worldwide seaborne transportation
of dry bulk commodities. The Company owns and operates a fleet
of seven dry bulk vessels that consists of three Handysize, two
Supramax and two Panamax vessels. Its fleet carries a variety of
dry bulk commodities, including coal, iron ore, and grains, as
well as bauxite, phosphate, fertilizer and steel products.
SERVICE CORP: S&P Assigns 'BB' Rating to $1.1BB Credit Facility
---------------------------------------------------------------
Standard & Poor's Ratings Services said it assigned a 'BB' issue-
level rating to Service Corp. International's (SCI's) amended and
restated $1.1 billion credit facility. The credit facility will
consist of a $500 million revolver and a term loan facility with a
principal balance up to $600 million. S&P expects the company to
use the proceeds from the term loan to fund the planned
acquisition of Stewart Enterprises Inc. that was announced on
May 29, 2013. The company will also have $382 million borrowing
capacity on its revolver after outstanding letters of credit. The
recovery rating on the credit facility is a '3', indicating
meaningful recovery in the event of a payment default. S&P's
recovery rating on the credit facility is capped at '3' (which is
generally consistent with recovery expectations of 50%-70%),
despite S&P's base case expectation for very high recovery given
the current capital structure. This cap reflects a heightened
risk that the recovery prospects on unsecured debt of companies
with a corporate credit rating in the 'BB' category may be
impaired by additional priority or pari passu debt or other claims
prior to a default.
Ratings List
Service Corp. International
Corporate Credit Rating BB/Stable/--
New Ratings
Service Corp. International
$500M Revolver Due 2018 BB
Recovery Rating 3
$600M Term Loan Due 2018 BB
Recovery Rating 3
SINLAIR BROADCAST: Shareholders Elect Eight Directors
-----------------------------------------------------
At annual meeting of shareholders of Sinclair Broadcast Group,
Inc., held on June 6, 2013, the shareholders elected eight
directors for a term expiring at the next annual shareholders
meeting in 2014 or until their respective successors have been
elected and qualified, namely:
(1) David D. Smith;
(2) Frederick G. Smith;
(3) Duncan J. Smith;
(4) Robert E. Smith;
(5) Basil A. Thomas;
(6) Lawrence E. McCanna;
(7) Daniel C. Keith; and
(8) Martin R. Leader.
The shareholders ratified the appointment of
PricewaterhouseCoopers LLP as the Company's independent auditors
for the fiscal year ending Dec. 31, 2013, and approved the 2013
Executive Incentive Plan.
About Sinclair Broadcast
Based in Baltimore, Maryland, Sinclair Broadcast Group, Inc.
(Nasdaq: SBGI) -- http://www.sbgi.net/-- one of the largest and
most diversified television broadcasting companies, currently owns
and operates, programs or provides sales services to 58 television
stations in 35 markets. The Company's television group reaches
roughly 22% of U.S. television households and includes FOX,
ABC, CBS, NBC, MNT, and CW affiliates.
"Any insolvency or bankruptcy proceeding relating to Cunningham,
one of our LMA partners, would cause a default and potential
acceleration under the Bank Credit Agreement and could,
potentially, result in Cunningham's rejection of our seven LMAs
with Cunningham, which would negatively affect our financial
condition and results of operations," the Company said in its
annual report for the period ended Dec. 31, 2012.
The Company's balance sheet at March 31, 2013, showed $2.73
billion in total assets, $2.83 billion in total liabilities and a
$97.28 million total deficit.
* * *
As reported by the TCR on Feb. 24, 2011, Standard & Poor's Ratings
Services raised its corporate credit rating on Sinclair to 'BB-'
from 'B+'. The rating outlook is stable. "The 'BB-' rating on
Sinclair reflects S&P's expectation that the company could keep
its lease-adjusted debt to EBITDA below historical levels
throughout the election cycle, absent a reversal of economic
growth, meaningful debt-financed acquisitions, or significant
shareholder-favoring measures," explained Standard & Poor's credit
analyst Deborah Kinzer.
In September 2010, Moody's raised its ratings for Sinclair
Broadcast and subsidiary Sinclair Television Group, including the
Corporate Family Rating and Probability-of-Default Rating, each to
Ba3 from B1, and the ratings for individual debt instruments.
Moody's also assigned a B2 (LGD 5, 87%) rating to the proposed
$250 million issuance of Senior Unsecured Notes due 2018 by STG.
The Speculative Grade Liquidity Rating remains unchanged at SGL-2.
The rating outlook is now stable.
SUMMIT ENTERTAINMENT: S&P Withdraws 'B' CCR Following Repayment
---------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its ratings on Summit
Entertainment LLC, including its 'B' corporate credit rating. The
outlook was positive at the time of the ratings withdrawal.
The ratings withdrawal follows Summit's early repayment of its
$500 million senior secured term loan due September 2016.
In addition, Summit has become a guarantor of parent Lions Gate's
senior credit facility and outstanding senior second-priority
notes due 2016.
SUPERIOR HOMES: Trustee Wins in Madoff Look-Alike Appeal
--------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the U.S. Court of Appeals in Atlanta ruled on June 10
that a bankruptcy court properly enjoined creditors from suing a
third party when the lawsuits would have depleted the third
party's assets and rendered the bankruptcy trustee unable to
collect a judgment of his own.
According to the report, the bankruptcy trustee was pursuing
fraudulent-transfer claims against non-bankrupt third-party
defendants. The trustee determined the defendants had a limited
pool of $1 million in assets. He negotiated a settlement where
the defendants paid $800,000, on the condition that the bankruptcy
court enjoins creditors from suing.
The report notes that the bankruptcy court's injunction stopping
creditor suits was upheld in an eight-page unsigned opinion by the
Eleventh Circuit Court of Appeals in Atlanta. The appeals court
said the injunction was proper because allowing creditors' suits
to continue would have "drained" the defendants' assets and
allowed the creditors "to make an end run around the normal
bankruptcy procedures for distribution of the estate." The
appeals court also ruled that there was so-called related-to
jurisdiction allowing the bankruptcy court to make the injunction
in the first place.
The Bloomberg News report discloses that the same issue is
currently on appeal brought by the trustee for Bernard L. Madoff
Investment Securities LLC in the U.S. Court of Appeals in
Manhattan. Madoff trustee Irving Picard wants the appeals court
to reinstate his lawsuit and enjoin New York Attorney General Eric
Schneiderman from completing a $410 million settlement with feeder
fund manager J. Ezra Merkin. The Madoff and Atlanta cases are
arguably different in that the creditors in Atlanta would be
asserting the same claims as the bankruptcy trustee. In the
Madoff case, Schneiderman contends the Merkin customers have
claims independent of the trustee.
The Atlanta case is Apps v. Morrison (In re Superior Homes &
Investments LLC, 12-15451, U.S. Court of Appeals for the Eleventh
Circuit (Atlanta). The Madoff appeal in the circuit court is
Picard v. Schneiderman, 13-1785, U.S. Court of Appeals for the
Second Circuit (Manhattan).
About Bernard L. Madoff
Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff
orchestrated the largest Ponzi scheme in history, with losses
topping US$50 billion. On Dec. 15, 2008, the Honorable Louis A.
Stanton of the U.S. District Court for the Southern District of
New York granted the application of the Securities Investor
Protection Corporation for a decree adjudicating that the
customers of BLMIS are in need of the protection afforded by the
Securities Investor Protection Act of 1970. The District Court's
Protective Order (i) appointed Irving H. Picard, Esq., as trustee
for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP
as his counsel, and (iii) removed the SIPA Liquidation proceeding
to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789)
(Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims
agent.
On April 13, 2009, former BLMIS clients filed an involuntary
Chapter 7 bankruptcy petition against Bernard Madoff (Bankr.
S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The
petitioning creditors -- Blumenthal & Associates Florida General
Partnership, Martin Rappaport Charitable Remainder Unitrust,
Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert
US$64 million in claims against Mr. Madoff based on the balances
contained in the last statements they got from BLMIS.
On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff
Securities International Limited in London under bankruptcy
protection pursuant to Chapter 15 of the U.S. Bankruptcy Code
(Bankr. S.D. Fla. 09-16751).
The Chapter 15 case was later transferred to Manhattan. In June
2009, Judge Lifland approved the consolidation of the Madoff SIPA
proceedings and the bankruptcy case.
Judge Denny Chin of the U.S. District Court for the Southern
District of New York on June 29, 2009, sentenced Mr. Madoff to
150 years of life imprisonment for defrauding investors in United
States v. Madoff, No. 09-CR-213 (S.D.N.Y.).
Mr. Picard has made three distributions, paying more than half of
smaller claims in full and satisfying just over 50 percent of
larger customer claims totaling more than $17 billion.
About Superior Homes
Nineteen alleged creditors of Superior Homes & Investments LLC
filed an involuntary-bankruptcy petition for the Orlando-based
developer on Feb. 20, 2009. The creditors -- a group of would-be
resort-home owners -- sought bankruptcy for the company after the
company took about $34 million in deposits for vacation homes in a
791-lot Davenport community called Oakmont Resort & Spa in Polk
County, Florida, but those houses weren't built.
Tousa Inc., a Hollywood, Fla.-based builder, was supposed to
develop the Oakmont properties but it sought bankruptcy protection
in January 2008 (Bankr. S.D. Fla. Case No. 08-10928).
Wendy Anderson, Esq., at Anderson & Badgley PL, in Winter Park,
Florida, serves as counsel to the creditors.
TRIAD GUARANTY: Court Enters Interim Order for Equity Transfers
---------------------------------------------------------------
Womble Carlyle Sandridge & Rice, LLP on June 12 disclosed that the
United States Bankruptcy Court for the District of Delaware has
entered an interim order that establishes procedures for certain
transfers of equity interests in Triad Guaranty Inc. and the
taking or implementing of certain other actions affecting the
interests of Triad Guaranty Inc. A copy of the interim order is
available at the website of the United States Bankruptcy Court for
the District of Delaware at http://www.deb.uscourts.gov(a PACER
login and password is required). The case number for Triad
Guaranty Inc.'s bankruptcy case is 13-11452 (MFW).
About Triad Guaranty
Winston-Salem, N.C-based Triad Guaranty Inc. (OTC BB: TGIC)
-- http://www.triadguaranty.com/-- is a holding company that
historically provided private mortgage insurance coverage in the
United States through its wholly-owned subsidiary, Triad Guaranty
Insurance Corporation. TGIC is a nationwide mortgage insurer
pursuing a run-off of its existing in-force book of business.
In December 2012, the Company's mortgage insurer subsidiary, Triad
Guaranty Insurance Corporation, was placed into rehabilitation,
whereby the Illinois Department of Insurance was vested with
possession and control over all of TGIC's assets and operations.
On May 30, 2013, the magistrate judge for the U.S. District Court
of the Middle District of North Carolina issued an order denying
the Company's motion to dismiss a class action lawsuit against the
company and two of its former officers. Shareholders filed the
class action suit in 2009, claiming the company misled investors
about poor financial results caused by improper underwriting
procedures.
Triad Guaranty Inc. filed a Chapter 11 petition (Bankr. D. Del.
Case No. 13-11452) on June 3, 2013. The Company estimated assets
of at least $100 million and liabilities of less than $50,000.
Attorneys at Womble Carlyle Sandridge & Rice, LLP, serve as
counsel to the Debtor.
The Debtor says in court filings that it has no significant
operating activities and limited remaining cash and other assets
on hand. The Debtor has been exploring various strategic
alternatives, and will continue to do so from and after the
Petition Date.
The Debtor says that expenses primarily consist of legal fees,
fees paid to its board, annual premiums for directors' and
officers' liability insurance and general operating expenses. The
expenses range from $100,000 to $500,000 per quarter. Unless the
expenses are reduced, the Debtor expects to deplete all of its
remaining cash by the end of 2013 or earlier.
TRINITY COAL: Arch Coal Wants Access to Kentucky Mine
-----------------------------------------------------
Katy Stech writing for Dow Jones' DBR Small Cap reports that Arch
Coal Inc.'s International Coal Group wants a bankruptcy judge to
stop Trinity Coal Corp. from canceling legal agreements that would
save Trinity Coal money but could block International Coal Group
from accessing its 76-worker coal mine in Kentucky.
About Arch Coal
Arch Coal, Inc., headquartered in St. Louis, Missouri, is one of
the largest coal companies in the U.S. and had revenues of
approximately $3.2 billion in 2010.
Scott Depot, West Virginia-based International Coal Group, Inc.
(NYSE: ICO) produces coal in Northern and Central Appalachia and
the Illinois Basin. The Company has 13 active mining complexes,
of which 12 are located in Northern and Central Appalachia, and
one in Central Illinois. ICG's mining operations and reserves are
strategically located to serve utility, metallurgical and
industrial customers throughout the eastern United States.
The Company reported net income of $30.11 million on $1.17 billion
of total revenue for the year ended Dec. 31, 2010, compared with
net income of $21.52 million on $1.12 billion of total revenue
during the prior year.
* * *
International Coal Group carries 'B+' corporate credit rating from
Standard & Poor's Ratings Services.
As reported by the TCR on Feb. 22, 2011, Moody's Investors Service
upgraded International Coal Group, Inc.'s Corporate Family Rating
and Probability of Default Rating to B2 from Caa1, respectively.
The upgrades and B2 CFR favorably reflect prospects for strong
cash flow from operations (before capital spending) over the
intermediate-term, a substantial reserve position, and an ongoing
shift towards the production of higher margin metallurgical coal
used by the steel industry. A low level of legacy liabilities,
material increase in met coal production, and the shift towards
underground mining that somewhat mitigates uncertainties
surrounding surface mining permits provide additional support to
the ratings. However, the B2 CFR is constrained by relatively low
production levels, significant reliance on Central Appalachian
mines, and reliance on certain key mines. The ratings also
consider inherent operating and geologic risk associated with coal
mining, increased regulatory pressure, and the likelihood that
cash costs will continue to rise moderately over the intermediate
term.
About Trinity Coal
Trinity Coal Corp. is a coal mining company that owns coal
deposits located in the Appalachian region of the eastern United
States, specifically, in Breathitt, Floyd, Knott Magoffin, and
Perry Counties in eastern Kentucky and in Boone, Fayette, Mingo,
McDowell and Wyoming Counties in West Virginia.
Trinity's coal mining operations are organized into six distinct
coal mining complexes. Three complexes are located in Kentucky and
are referred to as Prater Branch Resources, Little Elk Mining and
Levisa Fork. The Kentucky Operations produced compliance and low
sulfur steam coal. Three complexes are located in West Virginia
and are referred to as Deep Water Resources, North Springs
Resources and Falcon Resources.
Trinity is a wholly owned subsidiary of privately held
multinational conglomerate Essar Global Limited.
Credit Agricole Corporate & Investment Bank, ING Capital LLC and
Natixis, New York Branch filed an involuntary petition for relief
under Chapter 11 against Trinity Coal Corporation and 15
affiliates (Bankr. E.D. Ky. Lead Case No. 13-50364). The three
entities say they are owed a total of $104 million on account
loans provided to Trinity.
On Feb. 14, 2013, Austin Powder Company, Whayne Supply Company and
Cecil I. Walker Machinery Co. filed an involuntary petition for
relief under Chapter 11 (Bankr. E.D. Ky. Case No. 13-50335)
against Frasure Creek Mining, LLC. On Feb. 19, 2013, Credit
Agricole, ING Capital and Natixis joined as petitioning creditors.
On March 4, 2013, the Debtors filed their consolidated answer to
involuntary petitions and consent to an order for relief and
reservation of rights, thereby consenting to the entry of an order
for relief in each of their respective Chapter 11 cases. An order
for relief in each of the Debtors was entered by the Court on
March 4, 2013, which converted the involuntary cases to voluntary
Chapter 11 cases. Sturgill, Turner, Barker & Moloney, PLLC serves
as the Committee's local counsel.
UNI-PIXEL INC: Goldberg Capital Held 5.7% Equity Stake at June 11
-----------------------------------------------------------------
In a Schedule 13G filing with the U.S. Securities and Exchange
Commission, Goldberg Capital Management disclosed that, as of
June 11, 2013, it beneficially owned 690,000 shares of common
stock of Uni-Pixel Inc. representing 5.74 percent of the shares
outstanding. A copy of the regulatory filing is available at:
http://is.gd/N9O1wV
About Uni-Pixel Inc.
The Woodlands, Tex.-based Uni-Pixel, Inc. (OTC BB: UNXL)
-- http://www.unipixel.com/-- is a production stage company
delivering its Clearly Superior(TM) Performance Engineered Films
to the Lighting & Display, Solar and Flexible Electronics market
segments.
Uni-Pixel incurred a net loss of $9.01 million in 2012, as
compared with a net loss of $8.56 million in 2011. The Company's
balance sheet at March 31, 2013, showed $19.40 million in total
assets, $693,193 in total liabilities and $18.71 million in total
shareholders' equity.
"As of December 31, 2012, we had a cash balance of approximately
$13.0 million and working capital of $12.8 million. We project
that current cash reserves will sustain our operations through at
least December 31, 2013, and we are not aware of any trends or
potential events that are likely to adversely impact our short
term liquidity through this term. We expect to fund our
operations with our net product revenues from our commercial
products, cash and cash equivalents supplemented by proceeds from
equity or debt financings, and loans or collaborative agreements
with corporate partners, each to the extent necessary," according
to the Company's annual report for the year ended Dec. 31, 2012.
UNIVISION COMMUNICATIONS: Fitch Affirms 'B' Issuer Default Rating
-----------------------------------------------------------------
Fitch Ratings has affirmed the 'B' Issuer Default Rating (IDR) and
all other ratings of Univision Communications, Inc. (Univision).
The Rating Outlook is Stable.
Key Rating Drivers:
The ratings incorporate Fitch's positive view of the U.S. Hispanic
broadcasting industry, given anticipated continued growth in
number and spending power of the Hispanic demographic.
Additionally, Univision benefits from a premier industry position,
with duopoly television and radio stations in most of the top
Hispanic markets, with a national overlay of broadcast and cable
networks. The company's networks garner significant market share
of Hispanic viewers and generate strong and stable ratings. This
large and concentrated audience provides advertisers with an
effective way to reach the growing U.S. Hispanic population.
Fitch expects Hispanic population growth to mitigate the impact of
longer-term secular issues that are challenging the overall media
& entertainment sector, namely, audience fragmentation and its
impact on advertising revenue. While the Hispanic broadcast
television audience is not immune to these pressures, Fitch
expects that its growing total size will offset the impact of any
audience fragmentation and drive ongoing ratings strength at
Univision's television properties. This should result in low to
mid-single-digit top-line growth at the television segment.
Fitch believes Univision's cost management efforts and growth in
high-margin retransmission revenue will provide an offset to the
rising programing investments. Fitch expects EBITDA margins levels
in the 38% to 39% range in 2013. Long term, Fitch believes
positive operating leverage from top-line growth and growth in
high-margin retransmission revenue will drive margin improvement.
Recent new entrants in the Hispanic broadcast and cable network
market will add to the competitive pressures facing Univision.
However, Univision currently has incumbent advantage and dominant
market presence, with all of the top 10 primetime network
broadcasts programs among Hispanics, according to Nielsen. Fitch
expects these factors, along with its pipeline of proven content
from Televisa, to enable it to grow amid these increasing
pressures.
The radio segment returned to moderate revenue and EBITDA growth
in mid-2011. In 2012 Revenue and EBITDA grew 4.1% and 6.9%,
respectively. In the near term, Fitch expects revenues to grow in
the low single digits. Fitch believes that most of the previous
Arbitron issues have been resolved, and rating information will be
more stable. Fitch notes that this business is also more sensitive
to macroeconomic factors as there is no subscription-based revenue
to offset advertising declines. Nonetheless, Radio accounts for
approximately 14% of revenues and Fitch believes modest operating
pressures can be accommodated within the current ratings.
Ratings concerns center on the highly leveraged capital structure,
limited free cash flow generation relative to total debt, as well
as the company's significant exposure to advertising revenue. Pro
forma for the February and May 2013 refinancing transactions,
Fitch estimates total leverage (including the subordinated
convertible preferred debentures due to Televisa) and secured
leverage of 11.0x and 8.9x, respectively. Fitch expects
deleveraging to be driven by EBITDA growth and modest levels of
mandatory term loan amortization.
In February 2013, Univision extended $3.4 billion of term loans
due in 2014/2017 to 2020. In addition, $487.6 million of
commitments were received for a new revolving credit facility
maturing in 2018 (there is a $62 million uncommitted accordion,
potentially taking the facility to $550 million). Also, In May
2013 the company announced its plan to issue $500 million in new
term loans maturing in 2020, and issued $700 million in 5.125%
senior secured notes due 2023. Proceeds from the May 2012
transaction are expected to be used to repay amounts outstanding
under the A/R facility, revolver, term loans due 2014, and a
portion of the 2017 term loan.
Over the past two years Univision has been active in reducing its
near-term maturities; Fitch estimates the remaining 2017 maturity
at approximately $760 million. After 2017, the company's next
material maturity is the $1.2 billion in notes due 2019. Fitch
believes that Univision could address the remaining 2017 maturity
organically. However, Fitch expects Univision to continue to
access the capital markets opportunistically to issue and extend
these maturities.
While Univision is still saddled with significant leverage from
the 2007 LBO, the refinancing transactions provides proof to
Fitch's longstanding belief that the private equity owners,
Televisa, and the secured lenders remain motivated to facilitate
Univision's long-term viability, as refinancing an improved
operating and credit profile will provide more value than
bankruptcy/debt restructuring. Underpinning this position is
Fitch's view that the company will be able to delever to a range
of 9x to 8x total leverage, or 7x to 6x on a secured basis by
2016; the secured lenders incurred 9x leverage through the senior
debt at the LBO. The recent extension activity provides a
meaningful runway for Univsion to improve its leverage profile.
Liquidity and Debt
Fitch regards current liquidity as adequate, particularly in light
of minimal near-term maturities. At March 31, 2013, liquidity
consisted of approximately $46.4 million of cash and approximately
$367.3 million available under the $487.6 million RCF due 2018
(net of borrowings and letters of credit). At March 31, 2013, the
$300 million AR securitization facility was fully borrowed. As
previously mentioned, in May 2013 the company issued new notes and
used a portion of the proceeds to repay borrowings under the
revolver and the AR securitization facility. Pro forma for the May
2013 transaction, Fitch estimates $452 million available under the
revolver and full availability under $120 million revolving
component of the AR securitization facility.
Fitch calculates 2012 FCF of approximately $70 million. Fitch's
expects annual free cash flow of $50 - $100 million in 2013 and
$150 to $250 million in 2014.
Fitch estimates at March 31, 2013, pro forma for the May 2013
financing activity, Univision had total debt of $10.5 billion,
which consisted primarily of:
-- $4.7 billion in senior secured term loans, $0.7 billion
due 2017 and $4 billion due March 2020;
-- $1.2 billion 6.875% senior secured notes due 2019;
-- $750 million 7.875% senior secured notes due 2020;
-- $815 million 8.5% senior unsecured notes due 2021;
-- $1.2 billion 6.75% senior secured notes due 2022;
-- $700 million 5.125% senior secured notes due 2023;
-- $1.125 billion 1.5% subordinated convertible debentures issued
to Televisa, due 2025. This note is a direct obligation of the
parent HoldCo, Broadcasting Media Partners, Inc., but is
serviced by dividends paid by Univision.
Univision'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 (going
concern), rather than a liquidation. Fitch employs a 7x distressed
enterprise value multiple reflecting the company's FCC licenses in
top U.S. markets. Fitch assumes a sustainable post restructuring
EBITDA of approximately $800 million, approximately a 15%
reduction from March 31, 2013 LTM EBITDA. Fitch estimates the
adjusted distressed enterprise valuation in restructuring to be
$5.1 billion. The 'B+' rating for the secured debt reflects
Fitch's expectations for recovery in the 51% to 70% range. The
'CCC+' rating on the $815 million senior unsecured notes reflects
Fitch's expectations for 0% recovery.
Rating Sensitivities:
Negative ratings actions could occur if operating results and FCF
are materially lower than Fitch's expectations (noted above). This
would be contradictory to Fitch's constructive view on the Spanish
language broadcasting industry and Univision's positioning within
it, and could indicate that the company is more susceptible to
secular challenges than previously anticipated.
Positive ratings actions could occur if Univision delevers
significantly from current levels, with indications that the
company is on target to reach 7x-9x and 5x-6x total and secured
leverage targets, respectively, by 2015/2016. Fitch expects
deleveraging could occur largely through EBITDA growth, as well as
modest debt reduction.
Fitch currently rates Univision as follows:
-- IDR 'B';
-- Senior secured 'B+/RR3';
-- Senior unsecured 'CCC+/RR6'.
VAIL LAKE: Case Summary & 12 Unsecured Creditors
------------------------------------------------
Debtor: Vail Lake USA, LLC
4824 Exchange Place
La Jolla, CA 92038
Bankruptcy Case No.: 13-05927
Chapter 11 Petition Date: June 5, 2013
Affiliates that simultaneously filed Chapter 11 petitions:
Debtor Case No.
------ --------
Vail Lake Village & Resort, LLC 13-05930
Vail Lake Groves, LLC 13-05931
Agua Tibia Ranch, LLC 13-05932
Outdoor Recreational Management, LLC 13-05944
Court: U.S. Bankruptcy Court
Southern District of California (San Diego)
Judge: Louise DeCarl Adler
Debtor's Counsel: Ali M.M. Mojdehi, Esq.
COOLEY LLP
4401 Eastgate Mall
San Diego, CA 92121-1909
Tel: (858) 550-6055
Fax: (858) 550-6420
E-mail: amojdehi@cooley.com
Vail Lake USA's
Estimated Assets: $100,000,001 to $500,000,000
Vail Lake USA's
Estimated Debts: $10,000,001 to $50,000,000
The petitions were signed by Thomas C. Hebrank, chief
restructuring officer.
Related entities that previously sought Chapter 11 protection:
Entity Case No. Petition Date
------ -------- -------------
North Plaza, LLC 04-00769 01/28/04
Vail Lake Rancho California, LLC 12-16884 12/26/12
Vail Lake USA's List of Its 12 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
North Plaza, LLC Litigation $1,500,000
P.O. Box 310 Settlement
La Mesa, CA 91944-3010
Jaraslav Medec Consulting $313,979
38000 Highway 79 S.
Temecula, CA 92589
Darrell Connerton Consulting $95,000
31618 Corte Rosario
Temecula, CA 92592
Wayne Gregory Consulting $48,000
Coldwell Banker Real Estate Services $25,021
Richard Crowell Consulting $24,000
The Paul Company Trade $22,000
Warner Springs -- $10,068
RBF Consulting Services $3,927
State of California, Resources -- $2,746
Control Board
County of Riverside -- $2,520
Southern California Edison Trade/Utility $1,603
WATERSTONE AT PANAMA: May Use Cash Collateral Until July 15
-----------------------------------------------------------
The Hon. Timothy J. Mahoney of the U.S. Bankruptcy Court for the
District of Nebraska has signed off on an agreed final order
authorizing Waterstone at Panama City Apartments LLC to use
certain cash collateral which Lenox Mortgage XVIII LLC asserts an
interest.
Pursuant to the stipulation:
1. the lender consented to the use of cash collateral;
2. the budget will not include any monthly expenses that
are received by Gene Wilczewski, any entity owned or
controlled by Gene Wilczewski, or any relatives of Gene
Wilczewski that exceed the lesser of: (a) $3,000; or
(b) 2 percent of the Debtor's total income per month;
3. the Debtor's use of cash collateral will terminate on
(a) July 15; (b) 10 days after lender provides notice to
the Debtor that it is terminating its consent; (c) the
occurrence of an event of default; or (d) the occurrence
of the effective date or consummation of a plan of
reorganization for the Debtor.
As adequate protection from any diminution in value of the
lender's collateral, the Debtor will grant the lender replacement
liens upon all assets and property of the Debtor and the estate.
As additional adequate protection, the Debtor will pay the lender
$143,297, which amount is the monthly principal and interest (at
the non-default interest rate) payment owed to lender pursuant to
the Note.
About Waterstone at Panama City Apartments, LLC
Omaha, Nebraska-based Waterstone at Panama City Apartments, LLC
filed for Chapter 11 protection (Bankr. D. Neb. Case No. 13-80751)
on April 9, 2013. Bankruptcy Judge Timothy J. Mahoney presides
over the case. William L. Biggs, Jr., Esq., at Gross & Welch,
P.C., L.L.O., represents the Debtor in its restructuring efforts.
The Debtor disclosed $26,159,064 in assets and $26,120,989 in
liabilities as of the Chapter 11 filing. The petition was signed
by Edward E. Wilczewski, manager.
WATERSTONE AT PANAMA: Garnishment in State Court Dissolved
----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Nebraska has entered
an order dissolving the garnishment in the state court proceeding
in Florida and directing the release of funds to Waterstone at
Panama City Apartments, LLC.
As reported by the Troubled Company Reporter on May 3, 2013, the
Debtor filed documents asking the Court to:
i) dissolve the garnishment issued in the State of Florida
and direct Lane Management LLC, Regents Bank and Centennial
Bank to release of the funds to the Debtor for use in its
operations;
ii) authorize the use of cash collateral; and
iii) grant adequate protection to the secured party.
The Debtor originally obtained financing for the apartment complex
through the Department of Housing and Urban Development. All of
the Debtor's real property and other assets, including but not
limited to an assignment of rents, were pledged as security to HUD
for payment of the mortgage note. On Aug. 28, 2013, HUD sold the
mortgage note to Lenox Mortgage XVIII, LLC. The original note
will mature until April 1, 2050.
The Debtor adds that a mortgage foreclosure action is pending in
the Circuit Court of the Fourteenth Judicial Circuit In and For
Bay County, Florida, Lenox Mortgage XVIII, LLC, a Delaware limited
liability company, v. Waterstone at Panama City Apartments, LLC.
In this relation, upon the dissolution of the garnishment, and the
release of other funds which have accumulated subject to the
garnishment, the Debtor will be able to make the appropriate
mortgage payments to Lenox and timely meet its order normal
monthly operating expenses.
About Waterstone at Panama City Apartments, LLC
Omaha, Nebraska-based Waterstone at Panama City Apartments, LLC
filed for Chapter 11 protection (Bankr. D. Neb. Case No. 13-80751)
on April 9, 2013. Bankruptcy Judge Timothy J. Mahoney presides
over the case. William L. Biggs, Jr., Esq., at Gross & Welch,
P.C., L.L.O., represents the Debtor in its restructuring efforts.
The Debtor disclosed $26,159,064 in assets and $26,120,989 in
liabilities as of the Chapter 11 filing. The petition was signed
by Edward E. Wilczewski, manager.
WATERSTONE AT PANAMA: Gross & Welch Okayed as Bankruptcy Attorneys
------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Nebraska authorized
Waterstone at Panama City Apartments LLC to employ William L.
Biggs, Esq., and the firm of Gross & Welch, P.C., L.L.O. as
counsel.
About Waterstone at Panama City Apartments, LLC
Omaha, Nebraska-based Waterstone at Panama City Apartments, LLC
filed for Chapter 11 protection (Bankr. D. Neb. Case No. 13-80751)
on April 9, 2013. Bankruptcy Judge Timothy J. Mahoney presides
over the case. William L. Biggs, Jr., Esq., at Gross & Welch,
P.C., L.L.O., represents the Debtor in its restructuring efforts.
The Debtor disclosed $26,159,064 in assets and $26,120,989 in
liabilities as of the Chapter 11 filing. The petition was signed
by Edward E. Wilczewski, manager.
WATERSTONE AT PANAMA: Withdraws Bid to Hire Burke Blue Hutchison
----------------------------------------------------------------
Waterstone at Panama City Apartments LLC has withdrawn its
application for approval of the employment of Douglas L. Smith and
the firm of Burke Blue Hutchison Walters & Smith, P.A., as special
counsel.
As reported by the Troubled Company Reporter on April 30, 2013,
Mr. Smith and the firm were to represent the Debtor in the
mortgage foreclosure action pending in the Circuit Court of the
Fourteenth Judicial Circuit in and for Bay County, Florida and
captioned Lenox Mortgage XVIII LLC v. Waterstone at Panama City
Apartments, LLC. In that litigation, the Debtor is represented by
the firm and Mr. Smith.
Creditor Lenox Mortgage XVIII LLC has objected to the proposed
hiring.
The Debtor has said in court papers that neither Mr. Smith nor the
firm have received, and it is not contemplated that either will
receive, any lien or other interest in the property of the Debtor
or of a third party to secure payment of its fees. No
compensation will be paid by the Debtor to Mr. Smith or the firm
except upon application or notice to and approval by the
Bankruptcy Court. To the best of the Debtor's knowledge, neither
Mr. Smith nor the firm have any connection with the creditors, or
any other party-in-interest.
About Waterstone at Panama City Apartments, LLC
Omaha, Nebraska-based Waterstone at Panama City Apartments, LLC
filed for Chapter 11 protection (Bankr. D. Neb. Case No. 13-80751)
on April 9, 2013. Bankruptcy Judge Timothy J. Mahoney presides
over the case. William L. Biggs, Jr., Esq., at Gross & Welch,
P.C., L.L.O., represents the Debtor in its restructuring efforts.
The Debtor disclosed $26,159,064 in assets and $26,120,989 in
liabilities as of the Chapter 11 filing. The petition was signed
by Edward E. Wilczewski, manager.
WIRECO WORLDGROUP: Weak Performance Cues Moody's to Cut CFR to B2
-----------------------------------------------------------------
Moody's Investors Service downgraded the corporate family rating
of WireCo WorldGroup Inc., a global manufacturer and seller of
wire and synthetic ropes, cables, and other related products, to
B2 from B1 and its probability of default rating to B2-PD from B1-
PD. These rating actions result from Moody's view that key debt
leverage metrics will remain weak, warranting the lower rating.
The rating outlook is changed to stable from negative.
The following rating actions were taken:
Corporate Family Rating downgraded to B2 from B1;
Probability of Default Rating downgraded to B2-PD from B1-PD;
Senior Secured Bank Credit Facility due 2017 affirmed at Ba2
(LGD2, 21%); and,
Senior Unsecured Notes due 2017 affirmed at B3 (LGD5, 76%).
Speculative grade liquidity rating affirmed at SGL-2.
Ratings Rationale:
The downgrade of WireCo's corporate family rating to B2 from B1
results from operating performance being weaker than previously
anticipated. The European crane market has not rebounded, nor does
Moody's anticipate a quick recovery due to the ongoing economic
uncertainties within the euro zone. Also, the demand for synthetic
rope is subject to some volatility due to the timing of offshore
oil and gas projects. Moody's expected significant levels of
permanent debt reduction, which has yet to materialize. Despite
the prospect of some operating improvement and debt reduction,
Moody's projects debt-to-EBITDA will remain elevated at about 6.0
times at FYE14. This is higher than the level previous identified
that could result in downward ratings pressure, but debt leverage
could decline further if the company is able to quickly realize
cost savings and acquisition synergies. Debt-to-book
capitalization will likely exceed 80%, and the company has
negative tangible net worth. Also, Moody's believes WireCo will
have difficulty generating large levels of operating earnings
relative to its debt service requirements, resulting in EBITA-to-
interest expense below 2.0 times over Moody's time horizon (all
ratios incorporate Moody's adjustments). These key credit metrics
are characteristic of lower rated entities.
Providing some offset to its leveraged capital structure and weak
credit metrics is WireCo's business profile, which Moody's views
as a key credit strength. It benefits from a leading market share
in providing high-tension steel and synthetic ropes and wire for
diverse end markets across a global footprint. The company derives
nearly 60% of its revenues from outside of Europe, providing
geographic diversity and less reliance on the European economy.
Global diversification does provide some offset to the economic
malaise in any particular region, especially as the euro zone
countries continue to face weak growth prospects. WireCo is trying
to improve its operating margins (adjusted EBITA margin 11.5% for
LTM 1Q13) by reducing production of low margin wire products,
improving operating efficiencies, and removing other costs.
Moody's projects that WireCo could achieve slightly higher
adjusted operating margins of 12% over the next 12 to 18 months,
compared with an adjusted EBITA margin of 11.5% for LTM 1Q13.
The SGL-2 speculative grade liquidity rating reflects Moody's view
that WireCo will maintain a good liquidity profile over the next
12 months. Revolver availability should be sufficient to meet any
potential shortfall in operating cash flow to cover its working
capital and capital expenditure needs. However, availability is
presently constrained since compliance with the first lien
financial leverage covenant is currently less certain, especially
as it steps down at the end of 3Q13.
The change in rating outlook to stable from negative reflects
Moody's expectations that WireCo will have unfettered access to
the full committed amount under its revolving credit facility and
will not be restricted by financial covenants. Sufficient revolver
availability would then give WireCo financial flexibility to
contend with uncertainties in the euro zone economy, as well as
weakened end markets.
Positive rating actions over the intermediate term are unlikely.
However, over the long term if WireCo improves its operating
margins such that EBITA-to-interest expense nears 3.0 times, and
debt-to-EBITDA is sustained below 4.5 times (all ratios include
Moody's adjustments), then positive ratings actions could be
considered. Also, an improved liquidity profile would also support
upward rating pressure.
Negative rating actions could occur if WireCo's operating
performance falls below Moody's expectations or if the company
experiences a weakening in financial performance due to a decline
in demand for its products. EBITA-to-interest expense sustained
below 1.5 times or debt-to-EBITDA remaining above 6.25 times (all
ratios incorporate Moody's standard adjustments) could pressure
the ratings. A deteriorating liquidity profile, debt-financed
acquisitions or large dividends could stress the ratings as well.
The principal methodology used in this rating was the Global
Manufacturing Industry Methodology published in December 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.
WireCo WorldGroup, Inc. headquartered in Kansas City, MO, is a
leading global manufacturer and seller of steel and synthetic
lifting products, servicing a diverse range of end markets,
geographies and customers with multiple product offerings,
including high-performance ropes, engineered products, specialty
steel wire and synthetic yarns. The company sells into diverse
industries including infrastructure, industrials, oil and gas,
mining, marine and fishing. Paine and Partners, LLC, through its
respective affiliates, owns about 80% and management owns the
remaining 20% of WireCo. Revenues for the twelve months through
March 31, 2013 totaled approximately $800 million.
* Moody's Cites Lack of Protections for Bonds from US Retailers
---------------------------------------------------------------
Investor protections in high-yield bonds from US retailers are
generally in line with those provided by other North American non-
financial issuers, Moody's Investors Service says in a new report.
In the retail sector, however, bonds backed by private equity
offer far weaker protections than those that are not.
The new report, "US Retailers' PE-Backed Bond Covenants Are Much
Weaker Than Non-PE Backed Issues," looks at 27 bonds issued by 21
retailers drawn from Moody's High-Yield Covenant Database. The
database includes covenant quality scores for overall covenant
packages and for six categories of risk protection within
packages, and on Moody's five-point scale, 1.0 denotes the
strongest investor protections and 5.0, the weakest.
"The retail bonds we reviewed had an average covenant quality
score of 3.63, compared with 3.69 for a sample of non-financial
corporate bonds," says Vice President -- Senior Credit Officer,
Scott Tuhy. "The retail sector's bonds tend to have stronger
protections against investments in risky assets and liens, offset
by weaker protections against leveraging and change of control."
But in all six risk categories, Tuhy says, retail bonds backed by
private equity were weaker than those without private equity
sponsors. The average covenant quality score for PE-backed bonds
was 3.71, compared with 3.02 for non-PE-backed issues.
Specifically, covenants governing investments, liens subordination
and change of control were notably worse for the PE-backed bonds.
Weaker investment limits give sponsors greater flexibility to use
proceeds from asset sales to make risky investments rather than to
pay down debt, while change of control provisions allow sponsors
to pursue exit strategies and provide returns to equity investors
without financing bond redemptions. And weakness in liens
covenants is credit negative because the right to pledge assets
can help finance distributions.
"US retail bonds backed by private equity are also weaker than the
broader universe of PE-backed deals, scoring an average of 3.71
compared with 3.49," Tuhy says. "Again, the divergence reflects
weaker terms around restricted payments and liens, which are both
of key interest to investors."
* UST Issues New Guidelines for Legal Fees in Large Ch.11 Cases
---------------------------------------------------------------
The Department of Justice on June 12 announced new guidelines for
the payment of attorneys' fees and expenses in large chapter 11
bankruptcy cases to enhance disclosure and transparency in the
compensation process and to help ensure that attorneys' fees and
expenses are based on market rates. The guidelines, which will go
into effect on Nov. 1, 2013, were developed by the U.S. Trustee
Program (USTP), the component of the department that protects the
integrity of the bankruptcy system by overseeing case
administration and litigating to enforce the bankruptcy laws.
"The costs of bankruptcy fall on the creditors and employees of
the debtor companies," said Acting Associate Attorney General Tony
West. "At a time when both the public and the most sophisticated
participants in the bankruptcy process say bankruptcy attorneys'
costs are rising too rapidly, these guidelines are designed to
ensure that statutory requirements limiting bankruptcy fees to
market rates -- not premium rates -- are followed."
The Bankruptcy Code allows professionals who provide services
during a chapter 11 case to be compensated from funds of the
debtor company if statutory requirements are met and the
bankruptcy court approves payment. Reviewing and, where
appropriate, objecting to professionals' applications for fees and
expenses is a statutory duty of the USTP. The guidelines explain
the criteria that U.S. Trustees use in reviewing and objecting to
those applications. They do not supersede statutes, rules or court
orders.
The update to the guidelines takes into account the significant
changes that have occurred in the legal industry as well as the
increasing complexity of business bankruptcy reorganization cases.
The guidelines were originally issued in 1996 and are being
updated in phases; the first phase, announced today, governs the
USTP's review of fees and expenses requested by attorneys in
chapter 11 cases with $50 million or more in assets and $50
million or more in liabilities. Although the guidelines are not
subject to the notice and comment process of the Administrative
Procedure Act, the USTP nevertheless modified earlier drafts of
the guidelines after two public comment periods and a public
meeting.
"We were pleased by the many helpful suggestions we received as we
drafted the guidelines," said Clifford J. White III, Director of
the Executive Office for U.S. Trustees. "The U.S. Trustee Program
went to great lengths to solicit public input while developing the
updated guidelines, reviewing and incorporating suggestions from
academics, attorneys and other participants in the bankruptcy
system."
The guidelines require a showing that the rates charged reflect
market rates outside of bankruptcy. The guidelines also provide
for the:
-- Use of budgets and staffing plans;
-- Disclosure of rate increases that occur during the
representation;
-- Use of rates that are based on the attorney's home
office location;
-- Submission of billing records in an open, searchable
electronic format;
-- Use of independent fee committees and fee examiners; and
-- Use of model forms and templates for applications for
compensation and expenses.
The updated guidelines apply to attorneys' fees and expenses in
cases filed on or after Nov. 1, 2013, that meet the large case
threshold. Until the USTP adopts additional superseding guidelines
in the next phases of revisions, the 1996 guidelines will continue
in effect for the review of fee applications filed in larger
chapter 11 cases by professionals who are not attorneys; in all
chapter 11 cases below the large case threshold; and in cases
under other chapters of the Bankruptcy Code.
USTP attorneys in districts throughout the country will vigorously
enforce the guidelines, defending them in bankruptcy court and
through appeals as appropriate. The USTP also will educate
bankruptcy attorneys regarding the guidelines and encourage
bankruptcy courts to incorporate the guidelines in their local
rules of bankruptcy procedure, as many have done with the 1996
guidelines.
The guidelines and explanatory materials are posted at
http://www.justice.gov/ust
Blended Hourly Rates
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the some of the rules announced by the Justice
Department's U.S. Trustee Program aren't popular with
professionals practicing regularly in bankruptcy court.
The most controversial feature of the new guidelines requires
lawyers to tell the court more than the firm's posted hourly
rates. Instead of basing fees entirely on the firms' sticker
prices, professionals must disclose how much they actually billed
or collected from other clients in the prior year.
"Outside of bankruptcy, clients are asking for and more times than
not getting concessions" on hourly rates, according to Nancy B.
Rapoport, acting dean at the University of Nevada Las Vegas Law
School.
The report notes that Nancy Rapoport, an expert on bankruptcy
ethics, explained in an interview that the U.S. Trustees want
clients to have rates in bankruptcy they would be given outside of
bankruptcy. Chip Bowles, a bankruptcy lawyer from Louisville,
Kentucky, said disclosing actual billing rates or collections
"will drive everybody bonkers, because you're telling all your
clients what your blended hourly rates are." As result, other
clients will ask, "Why aren't I getting those rates?" Mr. Bowles
said in an interview. When disclosing fees charged to or
collected from other clients, the calculation must exclude
billings or collections by bankruptcy professionals.
Consequently, the guidelines may block professional firms from
charging more for their bankruptcy lawyers than for people in
other specializations. Much in the guidelines reflects how U.S.
Trustees and courts already review fee requests.
Budgets
Budgets, according to the Bloomberg report, are another
controversial feature of the new guidelines. The U.S. Trustees
will require professionals at the outset of a case to establish a
budget and staffing plan, "either with the consent of the parties
or by court order as soon as feasible after the commencement of
the case." Atty. Bowles said that some professionals are worried
that the budgets will tip off adversaries about strategies or
faults the lawyers anticipate in their own cases. As an example,
Mr. Bowles said, "Barclays would have liked to have known the
staffing and budget of Lehman's lawyers in their litigation."
Ms. Rapoport said that the U.S. Trustees received "a whole lot of
pushback on budgets" from lawyers who said "we can't possibly
predict what will happen in a case." She explained that the U.S.
Trustees simply want a "ballpark" estimate, not a "detailed budget
on the scale of the federal budget."
The Bloomberg news discloses that Ms. Rapoport was also
sympathetic to the requirements related to fee increases while the
bankruptcy is in progress. The professor said "the client and the
court really do need to know about those ahead of time." The new
guidelines require sometimes minute details describing how
professionals spend their days. For instance, billings must be in
increments of tenths of an hour, and work on different projects
can't be lumped together. When the professionals file their fee
requests, the work must be broken down into at least 22 different
categories. The guidelines reflect established practice in most
courts by allowing lawyers to be paid the rates where the
professional's home office is located. On the other hand, a
lawyer can't raise rates if the case is in a city where rates are
higher than in the lawyer's hometown. When it comes to
enforcement, the U.S. Trustees themselves won't always do the
legwork, especially in the larger cases. The guidelines allow for
appointment of independent fee examiners to review fee requests.
The U.S. Trustee Program contends that the fee guidelines are
procedural and thus don't require formal notice and comment under
the federal Administrative Procedures Act. Nonetheless, the
Justice Department developed the rules by holding meetings and
soliciting comments. The guidelines are being published in the
Federal Register.
* No Circuit Split on Dischargeability on Assigned Claims
---------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that there will be no split of circuits on the question of
whether assignment of a claim brings with it the right to object
to discharge ability of the debt under Section 523 of the
Bankruptcy Code.
The Bloomberg news report discloses that the U.S. Court of Appeals
in Cincinnati found "no compelling reason" to part company with
the courts of appeal in Chicago and San Francisco which previously
held that "assignees may seek non-discharge ability under Section
523(a) (2)." In the opinion written by Sixth Circuit Judge Helene
N. White on June 10, the bankruptcy judge had dismissed a
discharge ability complaint based on fraud brought by the assignee
of a claim. The district court reversed, and its opinion was
upheld by Judge White.
The case is Pazdziez v. First American Title Insurance Co. (In re
Pazdziez), 11-2398, U.S. Court of Appeals for the Sixth Circuit
(Cincinnati).
* Safe-Harbor Defense Waived When Raised Two Years Into Suit
------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that U.S. District Judge Kristine G. Baker from Little
Rock, Arkansas, ruled on June 10 that the safe harbor defense
protecting financial institutions or transactions in securities
can be waived if not raised soon enough in a lawsuit.
The report recounts that the case involved a fraudulent transfer
and preference suit filed in federal district court by a
bankruptcy trustee. More than two years into the case and one
month before trial, the defendant filed a motion for summary
judgment contending there were no disputed issues of fact and the
suit should be dismissed under the safe harbor contained in
Section 546(e) of the Bankruptcy Code.
The report notes that Judge Baker refused to dismiss the suit,
saying the defense was waived. Waiting so long to raise the
defense otherwise would "result in unfair surprise and prejudice"
to the trustee," the judge held.
The Bloomberg News report discloses that even if the defense
weren't waived, Judge Baker said there were disputed facts making
summary judgment unavailable. She said no party to the suit
claimed to be a financial institution that would be protected by
the safe harbor. Judge Baker said an issue at trial would include
the question of whether there was sufficient involvement of a
financial institution for invocation of the defense.
The case is Rice v. Luken Communications LLC, 11-00386, U.S.
District Court, Eastern District of Arkansas (Little Rock).
* Recent Small-Dollar & Individual Chapter 11 Filings
-----------------------------------------------------
In re The Grand Reserve Condominiums Association at Tampa, Inc.
Bankr. M.D. Fla. Case No. 13-07406
Chapter 11 Petition filed June 3, 2013
See http://bankrupt.com/misc/flmb13-07406p.pdf
See http://bankrupt.com/misc/flmb13-07406c.pdf
represented by: Jay B. Verona, Esq.
SHUMAKER, LOOP & KENDRICK, LLP
E-mail: jverona@slk-law.com
In re Blue Oak Properties LLC
Bankr. N.D. Ga. Case No. 13-62222
Chapter 11 Petition filed June 3, 2013
Filed as Pro Se
In re Our Place Bakery/Cafe, L.L.C.
Bankr. N.D. Ga. Case No. 13-62224
Chapter 11 Petition filed June 3, 2013
See http://bankrupt.com/misc/ganb13-62224.pdf
represented by: Alan Kan, Esq.
KAN & CLARK, LLP
E-mail: akan@kanclarklaw.com
In re Security Technologies, Inc.
Bankr. E.D. Mich. Case No. 13-51232
Chapter 11 Petition filed June 3, 2013
See http://bankrupt.com/misc/mieb13-51232p.pdf
See http://bankrupt.com/misc/mieb13-51232c.pdf
represented by: Edward J. Gudeman, Esq.
GUDEMAN & ASSOCIATES, P.C.
E-mail: ejgudeman@gudemanlaw.com
In re 5310 BAYHAM, LLC
Bankr. E.D. Mich. Case No. 13-51258
Chapter 11 Petition filed June 3, 2013
See http://bankrupt.com/misc/mieb13-51258p.pdf
See http://bankrupt.com/misc/mieb13-51258c.pdf
represented by: Ethan D. Dunn, Esq.
MAXWELL DUNN, PLC
E-mail: bankruptcy@maxwelldunnlaw.com
In re Patriot Tool, Inc.
Bankr. E.D. Mich. Case No. 13-51260
Chapter 11 Petition filed June 3, 2013
See http://bankrupt.com/misc/mieb13-51260.pdf
represented by: Ethan D. Dunn, Esq.
MAXWELL DUNN, PLC
E-mail: bankruptcy@maxwelldunnlaw.com
In re Howedo, Inc.
Bankr. E.D.N.Y. Case No. 13-43405
Chapter 11 Petition filed June 3, 2013
See http://bankrupt.com/misc/nyeb13-43405.pdf
Filed as Pro Se
In re Sun Studios, Inc.
Bankr. E.D.N.Y. Case No. 13-43418
Chapter 11 Petition filed June 3, 2013
See http://bankrupt.com/misc/nyeb13-43418.pdf
represented by: Lawrence F. Morrison, Esq.
THE MORRISON LAW OFFICES, P.C.
E-mail: morrlaw@aol.com
In re Incare, LLC
Bankr. E.D. Pa. Case No. 13-14926
Chapter 11 Petition filed June 3, 2013
See http://bankrupt.com/misc/paeb13-14926.pdf
represented by: Michael P. Gigliotti, Esq.
KASHKASHIAN & ASSOCIATES
E-mail: mikegigs@gmail.com
In re Islamic Association of DeSoto, Texas
Bankr. N.D. Tex. Case No. 13-32916
Chapter 11 Petition filed June 3, 2013
See http://bankrupt.com/misc/txnb13-32916.pdf
represented by: Marilyn D. Garner, Esq.
LAW OFFICES OF MARILYN D. GARNER
E-mail: mgarner@marilyndgarner.net
In re T Jordan Towing Inc.
dba Conoco
Texaco Food Mart
Bright Towing, Inc.
T Jordan
T Jordan Salvage
Midnight Bar and Grill
Bankr. N.D. Tex. Case No. 13-42650
Chapter 11 Petition filed June 3, 2013
See http://bankrupt.com/misc/txnb13-42650.pdf
represented by: Joyce W. Lindauer, Esq.
JOYCE W. LINDAUER, ATTORNEY AT LAW
E-mail: courts@joycelindauer.com
In re LPN & Giraldo Corporation
Bankr. S.D. Tex. Case No. 13-33442
Chapter 11 Petition filed June 3, 2013
See http://bankrupt.com/misc/txsb13-33442.pdf
represented by: Scott Khoa Bui, Esq.
BUI & NHAN, PLLC
E-mail: sbui@buinhanlaw.com
In re Heavenly Health Care, LLC
Bankr. S.D. Tex. Case No. 13-70267
Chapter 11 Petition filed June 3, 2013
See http://bankrupt.com/misc/txsb13-70267.pdf
represented by: Eduardo V. Rodriguez, Esq.
MALAISE LAW FIRM
E-mail: igotnoticesbv@malaiselawfirm.com
In re Decker Design, Inc.
dba Mar-Cal Products, Inc.
Bankr. W.D. Wis. Case No. 13-12826
Chapter 11 Petition filed June 3, 2013
See http://bankrupt.com/misc/wiwb13-12826.pdf
represented by: Galen W. Pittman, Esq.
GALEN W. PITTMAN, S.C.
E-mail: galenpittman@centurytel.net
In re Akop Boulanikian
Bankr. C.D. Cal. Case No. 13-24737
Chapter 11 Petition filed June 4, 2013
In re Arcelia Galicia
Bankr. C.D. Cal. Case No. 13-13761
Chapter 11 Petition filed June 4, 2013
In re Arlingwood Civic Association
Bankr. M.D. Fla. Case No. 13-03468
Chapter 11 Petition filed June 4, 2013
See http://bankrupt.com/misc/flmb13-3468.pdf
represented by: Jason A. Burgess, Esq.
The Law Offices of Jason A. Burgess, LLC
E-mail: jason@jasonaburgess.com
In re Bart Huitema
Bankr. M.D. Fla. Case No. 13-7441
Chapter 11 Petition filed June 4, 2013
In re Jeffery Buchanan
Bankr. M.D. Fla. Case No. 13-3485
Chapter 11 Petition filed June 4, 2013
In re Orlando Southwest, LLC
Bankr. M.D. Fla. Case No. 13-06972
Chapter 11 Petition filed June 4, 2013
See http://bankrupt.com/misc/flmb13-6972.pdf
represented by: Lawrence M. Kosto, Esq.
Kosto & Rotella PA
E-mail: lkosto@kostoandrotella.com
In re Creative Capital Recovery, Inc.
Bankr. S.D. Fla. Case No. 13-23309
Chapter 11 Petition filed June 4, 2013
See http://bankrupt.com/misc/flsb13-23309.pdf
represented by: David Marshall Brown, Esq.
E-mail: DavidBrownfll@gmail.com
In re Home Style Restaurant, Inc.
Bankr. S.D. Fla. Case No. 13-23317
Chapter 11 Petition filed June 4, 2013
See http://bankrupt.com/misc/flsb13-23317.pdf
represented by: Owei Z. Belleh, Esq.
E-mail: ozbelleh@yahoo.com
In re Bridgewater Development LLC
Bankr. M.D. Ga. Case No. 13-70707
Chapter 11 Petition filed June 4, 2013
See http://bankrupt.com/misc/gamb13-70707p.pdf
See http://bankrupt.com/misc/gamb13-70707c.pdf
Filed pro se
In re Jones Construction & Investment Properties, Inc.
Bankr. M.D. Ga. Case No. 13-70706
Chapter 11 Petition filed June 4, 2013
See http://bankrupt.com/misc/gamb13-70706.pdf
Filed pro se
In re Knowledge Development Partners LP
Bankr. N.D. Ga. Case No. 13-62429
Chapter 11 Petition filed June 4, 2013
See http://bankrupt.com/misc/ganb13-62429.pdf
represented by: Christine M. Stadler, Esq.
Stadler Law Group, LLC
E-mail: christine@stadlerlawgroup.com
In re The Smoot Group, LLC
Bankr. N.D. Ga. Case No. 13-62387
Chapter 11 Petition filed June 4, 2013
Filed pro se
In re 1410 South Barrington, LLC
Bankr. N.D. Ill. Case No. 13-23290
Chapter 11 Petition filed June 4, 2013
See http://bankrupt.com/misc/ilnb13-23290.pdf
represented by: Jennifer L. Barton, Esq.
Steve Jakubowski, Esq.
Robbins, Salomon & Patt, Ltd.
E-mail: jbarton@rsplaw.com
sjakubowski@rsplaw.com
In re A & A Industrial Services, LLC
Bankr. D. Kans. Case No. 13-21430
Chapter 11 Petition filed June 4, 2013
See http://bankrupt.com/misc/ksb13-21430.pdf
represented by: Byron Loudon, Esq.
E-mail: byronloud@aol.com
In re Tysons National, Inc.
dba Tysons Buffet & Restaurant
Bankr. D. Md. Case No. 13-19664
Chapter 11 Petition filed June 4, 2013
See http://bankrupt.com/misc/mdb13-19664.pdf
represented by: Richard B. Rosenblatt, Esq.
The Law Offices of Richard B. Rosenblatt
E-mail: rbrbankruptcy@gmail.com
In re Marilyn Fink
Bankr. D. Nev. Case No. 13-51123
Chapter 11 Petition filed June 4, 2013
In re Mount's Garage, Inc.
Bankr. D.N.J. Case No. 13-22419
Chapter 11 Petition filed June 4, 2013
See http://bankrupt.com/misc/njb13-22419.pdf
represented by: Barry W. Frost, Esq.
Teich Groh
E-mail: bfrost@teichgroh.com
In re Dontaku Inc.
Bankr. E.D.N.Y. Case No. 13-43453
Chapter 11 Petition filed June 4, 2013
See http://bankrupt.com/misc/nyeb13-43453.pdf
represented by: Xiangan Gong, Esq.
E-mail: xaglaw@gmail.com
In re Michael Spada
Bankr. N.D.N.Y. Case No. 13-11461
Chapter 11 Petition filed June 4, 2013
In re Fadley Farms Inc.
Bankr. N.D. Ohio Case No. 13-32389
Chapter 11 Petition filed June 4, 2013
See http://bankrupt.com/misc/ohnb13-32389.pdf
represented by: Raymond L. Beebe, Esq.
Raymond L. Beebe Co LPA
E-mail: RLBCT@buckeye-express.com
In re TJ Auto Imports, Inc.
Bankr. E.D. Pa. Case No. 13-14988
Chapter 11 Petition filed June 4, 2013
See http://bankrupt.com/misc/paeb13-14988.pdf
represented by: Michael D. Sayles, Esq.
Sayles and Associates
E-mail: midusa1@comcast.net
In re La Tina Uniforms & Dry Cleaning Inc
aka La Tina Uniforms And Dry Cleaning Inc.
Bankr. D.P.R. Case No. 13-04575
Chapter 11 Petition filed June 4, 2013
See http://bankrupt.com/misc/prb13-4575.pdf
represented by: Gloria M. Justiniano Irizarry, Esq.
Justiniano's Law Office
E-mail: gloriae55amg@yahoo.com
In re Howard Lane
Bankr. M.D. Tenn. Case No. 13-4888
Chapter 11 Petition filed June 4, 2013
In re Amrco, Inc.
Bankr. W.D. Tex. Case No. 13-11086
Chapter 11 Petition filed June 4, 2013
Filed pro se
In re Christian Hunter
Bankr. W.D. Tex. Case No. 13-11083
Chapter 11 Petition filed June 4, 2013
In re All State Towing, Inc.
Bankr. E.D. Va. Case No. 13-33081
Chapter 11 Petition filed June 4, 2013
See http://bankrupt.com/misc/vaeb13-33081.pdf
Represented by: Ronald A. Page, Jr., Esq.
Ronald Page, PLC
E-mail: rpage@rpagelaw.com
In re Charlie B's BBQ and Family Dining, Inc.
Bankr. N.D. Ala. Case No. 13-02574
Chapter 11 Petition filed June 5, 2013
See http://bankrupt.com/misc/alnb13-02574p.pdf
See http://bankrupt.com/misc/alnb13-02574c.pdf
represented by: Jamie Alisa Wilson, Esq.
BENTON & CENTENO, LLP
E-mail: jwilson@bcattys.com
In re Orlando Gateway Partners, LLC
Bankr. M.D. Fla. Case No. 13-07056
Chapter 11 Petition filed June 5, 2013
See http://bankrupt.com/misc/flmb13-07056.pdf
represented by: Thomas Sadaka, Esq.
SEIDEN ALDER MATTHEWMAN & BLOCH
E-mail: tom@nejamelaw.com
In re Opa Restaurant Group, Inc.
Bankr. S.D. Fla. Case No. 13-23425
Chapter 11 Petition filed June 5, 2013
See http://bankrupt.com/misc/flsb13-23425.pdf
represented by: Brett A. Elam, Esq.
THE LAW OFFICES OF BRETT A. ELAM, P.A.
E-mail: belam@brettelamlaw.com
In re Back River Marine and Agriculture Corp.
Bankr. D. Mass. Case No. 13-13446
Chapter 11 Petition filed June 5, 2013
See http://bankrupt.com/misc/mab13-13446.pdf
represented by: David B. Madoff, Esq.
MADOFF & KHOURY, LLP
E-mail: alston@mandkllp.com
In re CHAP - GFK
Bankr. D. Minn. Case No. 05-77777
Chapter 11 Petition filed June 5, 2013
Filed as Pro Se
In re Shea at Tenaya Village Owners Association
Bankr. D. Nev. Case No. 13-14935
Chapter 11 Petition filed June 5, 2013
See http://bankrupt.com/misc/nvb13-14935.pdf
represented by: E. Robert Spear, Esq.
Law Office of Robert Spear
E-mail: rspear@spearlegal.com
swaugh@spearlegal.com
In re El Tequilazo Corp.
dba El Tequilazo
Bankr. S.D.N.Y. Case No. 13-11877
Chapter 11 Petition filed June 5, 2013
See http://bankrupt.com/misc/nysb13-11877.pdf
In re Mandko Family LLC
Bankr. E.D.N.C. Case No. 13-03610
Chapter 11 Petition filed June 5, 2013
See http://bankrupt.com/misc/nceb13-03610p.pdf
See http://bankrupt.com/misc/nceb13-03610c.pdf
represented by: William S. Bost, III, Esq.
E-mail: bill@bbostlaw.com
In re Faith Temple Apostolic Church of God, Inc.
Bankr. S.D. Ohio Case No. 13-12706
Chapter 11 Petition filed June 5, 2013
See http://bankrupt.com/misc/ohsb13-12706.pdf
represented by: David A. Kruer, Esq.
DAVID KRUER & COMPANY, LLC
E-mail: dkandco@fuse.net
In re Helzer, James E.
aka Jim E. Helzer
J. E. Helzer
Bankr. N.D. Tex. Case No. 13-42626
Chapter 11 Petition filed June 5, 2013
See http://bankrupt.com/misc/txnb13-42626.pdf
represented by: Behrooz P. Vida, Esq.
THE VIDA LAW FIRM, PLLC
In re Sweetwater Alliance, Inc.
Bankr. S.D. Tex. Case No. 13-33532
Chapter 11 Petition filed June 5, 2013
See http://bankrupt.com/misc/txsb13-33532p.pdf
See http://bankrupt.com/misc/txsb13-33532c.pdf
represented by: Jeanne Fugate, Esq.
LAW OFFICE OF JEANNE FUGATE, PLLC
In re Charles Chiu
Bankr. D. Ariz. Case No. 13-9725
Chapter 11 Petition filed June 6, 2013
In re Osborn Financial Group, LLC
Bankr. D. Ariz. Case No. 13-09706
Chapter 11 Petition filed June 6, 2013
See http://bankrupt.com/misc/azb13-9706.pdf
represented by: Allan D. Newdelman, Esq.
Allan D Newdelman PC
E-mail: anewdelman@qwestoffice.net
In re Lisa Dearmore
Bankr. N.D. Cal. Case No. 13-11150
Chapter 11 Petition filed June 6, 2013
In re Conrado Alvarez
Bankr. M.D. Fla. Case No. 13-7064
Chapter 11 Petition filed June 6, 2013
In re Jesse Smith
Bankr. M.D. Ga. Case No. 13-10726
Chapter 11 Petition filed June 6, 2013
In re Dempsey Oil, Inc.
Bankr. D. Mass. Case No. 13-13481
Chapter 11 Petition filed June 6, 2013
See http://bankrupt.com/misc/mab13-13481.pdf
represented by: Timothy M. Mauser, Esq.
Law Office of Timothy Mauser, Esq.
E-mail: tmauser@mauserlaw.com
In re Contract Consultants II, LLC
Bankr. W.D. Mich. Case No. 13-04734
Chapter 11 Petition filed June 6, 2013
See http://bankrupt.com/misc/miwb13-4734.pdf
Represented by: Edward A. Newmyer, Esq.
E-mail: enewmyer@aol.com
In re Paul W. Marino Gages Inc.
Bankr. E.D. Mich. Case No. 13-51493
Chapter 11 Petition filed June 6, 2013
See http://bankrupt.com/misc/mieb13-51493p.pdf
See http://bankrupt.com/misc/mieb13-51493c.pdf
represented by: Michael A. Greiner, Esq.
Financial Law Group, P.C.
E-mail: mike@financiallawgroup.com
In re L.E. Auto Repair LLC
dba L&E Auto Repair
aka LE Auto Repair LLC
Bankr. D.N.J. Case No. 13-22626
Chapter 11 Petition filed June 6, 2013
See http://bankrupt.com/misc/njb13-22626p.pdf
See http://bankrupt.com/misc/njb13-22626c.pdf
represented by: John Hargrave, Esq.
Law Offices John W. Hargrave
E-mail: info@hargravelaw.com
In re Michael Ewart
Bankr. D.N.J. Case No. 13-22629
Chapter 11 Petition filed June 6, 2013
In re Oyster Creek Inn, Inc.
Bankr. D.N.J. Case No. 13-22624
Chapter 11 Petition filed June 6, 2013
See http://bankrupt.com/misc/njb13-22624.pdf
represented by: Daniel J. Gallagher, Esq.
Miller, Gallagher & Grimley
E-mail: gallagheresq@comcast.net
In re Melnob Enterprises, Inc.
Bankr. E.D.N.Y. Case No. 13-43485
Chapter 11 Petition filed June 6, 2013
See http://bankrupt.com/misc/nyeb13-43485.pdf
Filed pro se
In re XIO Restaurant Corp.
aka Barking Dog Restaurant
Bankr. S.D.N.Y. Case No. 13-11890
Chapter 11 Petition filed June 6, 2013
See http://bankrupt.com/misc/nysb13-11890.pdf
represented by: Steve R. Haffner, Esq.
Gordon & Haffner, LLP
E-mail: haffner.steven@gmail.com
In re Jason Nicholson
Bankr. W.D. Tenn. Case No. 13-11431
Chapter 11 Petition filed June 6, 2013
In re Irina Raskin
Bankr. C.D. Cal. Case No. 13-13905
Chapter 11 Petition filed June 8, 2013
In re John Kronberg
Bankr. D. Conn. Case No. 13-31089
Chapter 11 Petition filed June 8, 2013
*********
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
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re-mailing and photocopying) is strictly prohibited without prior
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herein is obtained from sources believed to be reliable, but is
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*** End of Transmission ***