/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/130806.mbx T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, August 6, 2013, Vol. 17, No. 216 Headlines AEMETIS INC: Incurs $9.6 Million Net Loss in Second Quarter AGFEED INDUSTRIES: Incentive Plan Approval Sought AGFEED INDUSTRIES: Gets Nod For Auction With $79MM Stalking Horse AGFEED INDUSTRIES: Hiring Approvals Sought AIRTRONIC USA: Lightweight MK 777 Launcher Ready for Shipping ALLIED IRISH: Reports EUR758 Million Net Loss in H1 2013 ALLY FINANCIAL: Incurs $927 Million Net Loss in Second Quarter ALLY'S FINANCIAL: DBRS Assigns 'BB' Long Term Debt Rating AMBAC FINANCIAL: US Trustee Looks to Shave Attorney's Fees AMERICAN AIRLINES: EU Approves AMR-USAir Merger AMERICAN PETRO-HUNTER: Hanover to Sell 16.1MM Common Shares APPLIED DNA: Sells 5,500 Additional Preferred Shares to Crede AXESSTEL INC: Stockholders Elect Four Directors ARCAPITA BANK: Panel Has Court's OK to Prosecute Avoidance Claims ARMORWORKS ENTERPRISES: Committee Can Retain Forrester as Counsel ARMORWORKS ENTERPRISES: Panel Hires Sierra Consulting as Advisor ARMORWORKS ENTERPRISES: Employs Wittie Letsche as Special Counsel ASTRO TEL: Verizon Says Defunct Rival Can't Prove Antitrust Claims BALLARD POWER: Incurs $5.8-Mil. Net Loss in Second Quarter BANYAN RAIL: Posts $1.6 Million Net Income in First Quarter BEAZER HOMES: Incurs $5.8 Million Net Loss in June 30 Quarter BLUEJAY PROPERTIES: Bid for Loan Participants Committee Withdrawn BLUEJAY PROPERTIES: Further Exclusivity Extension Won't Be Granted CASEY ANTHONY: Agrees to Pay $25,000 to Avoid Selling Life Story CASPIAN SERVICES: Extends CEO's Employment for Three Years CELL THERAPEUTICS: Incurs $18 Million Net Loss in Second Quarter CHRISTIAN RELIEF: S&P Affirms B Rating & Alters Outlook to Stable CLEAR CHANNEL: Posts $7.2 Million Net Income in Second Quarter COMMONWEALTH BANKSHARES: SEC Revokes Registration of Securities CORPORATE EXECUTIVE: S&P Affirms 'BB-' CCR After Debt Amendments CROWN MEDIA: Posts $16.5 Million Net Income in Second Quarter DELL INC: Fitch Ratings Guidance Unaffected by Merger Agreement DETROIT, MI: Property Owners Can File Tax Appeals, Not Collect DETROIT, MI: Mich. AG Sees No Conflict in Defending Retirees DETROIT, MI: PFRS Balks at Role of Retiree Committee DETROIT, MI: Slashes Pay for Some Police, Firefighter Unions DETROIT, MI: Congressional Democrats Seek to Boost Federal Aid DETROIT, MI: Lawyers in Bankruptcy May Face Scrutiny on Fees DETROIT, MI: Hiring Christie's for Valuation of Art Collection DIALOGIC INC: Had $10.4 Million Net Loss in First Quarter DIALOGIC INC: FS Finans Holds 12.6% Ownership DIALOGIC INC: ApS Kbus No Longer Owns Shares as of July 31 DUMA ENERGY: Pursuing Additional African Oil Concessions EASTMAN KODAK: Opposes Appointment of Equity Committee EASTMAN KODAK: Seeks Additional Time to Remove Civil Actions EASTMAN KODAK: Seeks Court Approval to Expand E&Y Services EDISON MISSION: Incurs $91 Million Net Loss in Second Quarter ELBIT IMAGING: Settles with Israeli Tax Authority for $2.2MM ELEPHANT TALK: To Convert $1 Million Loan to 1.8 Million Shares EMPIRE RESORTS: Option to Lease EPT Property Extended to Aug. 14 ENDEAVOR ENERGY: S&P Assigns 'B+' CCR & Rates $300MM Notes 'B+' EPICEPT CORP: Defaults Under MidCap Loan Agreement Waived EPICEPT CORP: Incurs $1.7 Million Net Loss in Second Quarter EXCEL MARITIME: Creditors Say Rival Plan In The Works FIRST PHILADELPHIA: Wants Plan Filing Exclusivity Until Nov. 21 FLOYD COUNTY, KY: Moody's Cuts General Obligation Ratings to Ba1 FREDERICK'S OF HOLLYWOOD: Inks 3rd Amendment to Salus Credit Pact FREESEAS INC: Issues 775,000 Add'l Settlement Shares to Hanover GATEHOUSE MEDIA: Incurs $14.1 Million Net Loss in Second Quarter GELT PROPERTIES: Hearing on Bucks County Bank Stay Relief Reset GELTECH SOLUTIONS: Grants 250,000 Options to Executives GH BROADCASTING: Sec. 341 Creditors' Meeting Set for Aug. 30 GLYECO INC: Stockholders Elect Five Directors GRAYMARK HEALTHCARE: Foundation Owns 70.2% Equity Stake GRYPHON GOLD: Chapter 11 Petition Filed HANDY HARDWARE: Littlejohn & Co. Completes Acquisition HERCULES OFFSHORE: Had $27.4-Mil. Net Loss in Second Quarter HERON LAKE: Granite Falls Acquires Majority Interest HERTZ CORP: DBRS Assigns 'BB' Issuer Rating HEXCEL CORP: Debt Repayment Prompts Moody's to Withdraw Ratings HIGH MAINTENANCE: Sec. 341 Creditors' Meeting Set for Aug. 30 IEMR RESOURCES: Gets Notice Default From American Cumo INFUSYSTEM HOLDINGS: Won't Pursue Potential Sale to Meson INTELLICELL BIOSCIENCES: Issues 8 Million Shares to Hanover INTELLIPHARMACEUTICS INT'L: Closes Offering of $3.1-Mil. Units INTELLIPHARMACEUTICS INT'L: Sabby Held 5% Equity Stake at July 26 ISAACSON STRUCTURAL: Can Hire Tamposi Law Group as Special Counsel J.C. PENNEY: Says News Report About CIT's Action is Untrue JACKSONVILLE BANCORP: To Cancel Former CEO's Unexercised Option JHK INVESTMENTS: Cash Collateral Use Extended Until Aug. 20 KIT DIGITAL: Wins Confirmation of Bankruptcy-Exit Plan LANDESK SOFTWARE: Moody's Keeps B2 CFR on Downsized Transactions LEMIC ENTERPRISE: A.M. Best Affirms 'C(weak)' FSR LEVEL 3: Incurs $24 Million Net Loss in Second Quarter LIFE CARE: U.S. Trustee Appoints 3 Members to Creditors Panel LIFE CARE: Can Employ Stutsman Thames as Bankruptcy Counsel LIFE CARE: Can Employ Navigant Capital as Financial Advisor MANTECH INT'L: Moody's Keeps Ba1 CFR Over Lower Earnings Guidance MEI INC: Moody's Assigns 'B1' CFR; Outlook Positive MERISEL INC: Merger with Saints Takes Effect MERISEL INC: Saints Capital No Longer Owns Shares MICROISLET INC: Islet Sciences Sued Over IP Asset Acquisition MIDWEST FAMILY: Moody's Hikes Ratings on 2 Series 2006 A Bonds MISSION NEW ENERGY: Had A$1.4 Million in Cash at June 30 MOBIVITY HOLDINGS: Names Jeff Hasen as Chief Marketing Officer MOBIVITY HOLDINGS: ACT Capital Held 9.9% Equity Stake at June 17 MONARCH COMMUNITY: Incurs $929,000 Net Loss in Second Quarter MOORE FREIGHT: Plan Disclosures Hearing on September 10 MOTORS LIQUIDATION: C. Tully is FTI's Corporate Finance Director MOUNTAIN COUNTRY: Trustee Hires Turner & Johns as Counsel MPG OFFICE: BPO Extends Expiration of Tender Offer to Aug. 9 MUSCLEPHARM CORP: Teams Up with Arnold Schwarzenegger NATIVE WHOLESALE: Hearing on Case Dismissal Bid Starts NATIVE WHOLESALE: Files Renewed Application to Employ Gable NEW ENTERPRISE: S&P Revises Outlook to Neg. & Affirms 'CCC' CCR NEXTRACTION ENERGY: Enters Into Loan Amendment with Tallin NORTHLAND CABLE: Partnership Agreement Expires December 13 NORTHLAND RESOURCES: Implements Final Steps of Bond Restructuring OCEAN 4660: Barreca Denied as CRO; Management Deal Disapproved OCEAN 4660: Genovese Joblove May Withdraw as Attorney OCEAN 4660: Ch.11 Trustee May Hire Stearns Weaver & Kerry-Ann Rin OCEAN 4660: Lloyd Berger Approved as Building Code Consultant OCI BEAUMONT: Moody's Assigns B1 CFR & Rates New $360MM Loan B1 OIL PATCH: Has Access to FCC and SOPUS Cash Until Aug. 30 OIL PATCH: Files Schedules of Assets and Liabilities OIL PATCH: Wants to Hire James Childs as Financial Advisor OIL PATCH: Hiring Okin & Adams as Bankruptcy Counsel OP-TECH ENVIRONMENTAL: Now a Wholly-Owned Subsidiary of NRC ORCHARD SUPPLY: Slams U.S. Trustee Opposition to $3MM Bonus Plan ORCHARD SUPPLY: Has Final Approval of $176.3MM DIP Loan Packages ORCHARD SUPPLY: Has Final Authority to Use Cash Collateral ORCHARD SUPPLY: Committee Seeks to Retain Pachulski as Counsel ORCHARD SUPPLY: Committee Taps Alvarez & Marsal as Fin'l Advisors ORCKIT COMMUNICATIONS: Arrangement with Noteholders Approved ORECK CORP: OAC Acquisition Wins Court Okay to Buy All Assets PARADISE HOSPITALITY: Opposes REF WB's Conversion Motion PARADISE VALLEY: Opposes American Bank's Conversion Motion PATRIOT COAL: Seeks to Change Loan Accord to Avoid Default PATRIOT COAL: Hires Duff & Phelps as Valuation Services Provider PENSON WORLDWIDE: 5th Amended Plan Filed, Plan Confirmed PETER DEHAAN: Sept. 30 Hearing to Confirm Chapter 11 Plan PHIL'S CAKE: Obtains Final Nod to Use Cash Collateral PHIL'S CAKE: Court Confirms Modified Amended Plan PNC BANK: $4MM Loan May Belong To Bankrupt Title Co.: 6th Circ. PORTER HAYDEN: Strikes $21MM Deal Over Asbestos Coverage RURAL/METRO CORP: Files for Chapter 11 with Restructuring Plan PRIME ACQUISITION: Gets Notice of Continued Listing on NASDAQ PRM FAMILY: U.S. Trustee Appoints 5-Member Creditors Committee PRM FAMILY: Panel Can Retain Freeborn & Peters as Lead Counsel PRM FAMILY: Hearing on BofA's Objection to HG Retention on Sept. 5 RURAL/METRO CORP: Voluntary Chapter 11 Case Summary SARKIS INVESTMENTS: Section 341(a) Meeting Set on Sept. 6 SHOTWELL LANDFILL: Seeks to Extend Plan Filing to Aug. 19 SHOTWELL LANDFILL: Hires Ragsdale Liggett as Special Counsel SMILE BRANDS: S&P Revises Outlook & Rates $310MM Facility 'B-' SOLIMAR ENERGY: In Negotiations with SCCP Over Alleged Default SOUND SHORE: Montefiore Gets Bankruptcy Court OK to Acquire Assets SPROUTS FARMERS: S&P Revises Outlook to Pos. & Assigns 'B+' CCR STANDARD PACIFIC: Fitch Rates $300MM Unsecured Notes at 'B/RR4' TELETOUCH COMMUNICATIONS: To Liquidate Under Chapter 11 TWIN DEVELOPMENT: Hires Robert Legate as Special Counsel US POSTAL: CCAGW Says New Senate Bill Fails to Prevent Bankruptcy VAN DYKE: Moody's Lowers Ratings on $34.5MM Debt to 'Ba1' WOOTON GROUP: Balks at Bid to Dismiss or Convert Case * LPS' June Mortgage Monitor Shows Spike in Delinquency Rate * Morgan Drexen Challenges Constitutionality of CFPB Structure * Ralph Lay Joins Algon Group as Senior Managing Director * Large Companies With Insolvent Balance Sheets ********* AEMETIS INC: Incurs $9.6 Million Net Loss in Second Quarter ----------------------------------------------------------- Aemetis, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $9.59 million on $47.35 million of revenues for the three months ended June 30, 2013, as compared with a net loss of $9.74 million on $44.27 million of revenues for the same period a year ago. For the six months ended June 30, 2013, the Company incurred a net loss of $19.40 million on $66.77 million of revenues, as compared with a net loss of $18.11 million on $88.47 million of revenues for the same period during the prior year. As of June 30, 2013, the Company had $96.54 million in total assets, $107.01 million in total liabilities, and a $10.47 million total stockholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/bh9AZ2 Amends Note Purchase Agreement Aemetis and its wholly-owned subsidiaries Aemetis Advanced Fuels Keyes, Inc., and Aemetis Facility Keyes, Inc., entered into a Limited Waiver and Amendment No. 5 to Amended and Restated Note Purchase Agreement with Third Eye Capital Corporation, as agent, for the noteholders. Amendment No. 5 amends the Amended and Restated Note Purchase Agreement, dated July 6, 2012, among the Company, Administrative Agent and Lenders. Pursuant to Amendment No. 5, Third Eye on behalf of the Lenders agreed to waive these covenants of the Borrowers in their entirety: (i) Borrowers' obligation to achieve the Milo Conversion by May 31, 2013; (ii) Borrowers' Minimum Monthly Redemption Amount between May 3, and June 28; (iii) Borrowers' payment of Mandatory Tiered Redemptions for the quarter ending June 30, 3013; (iv) all future Minimum Monthly Base Redemption Amounts and all future Mandatory Tiered Redemptions; (iv) Borrower's interests in arrears; (v) requirement to maintain trailing Free Cash Flow covenants through Dec. 31, 2013; and (vi) ratios of Note Indebtedness to Keyes Plant Market Value and Keyes Plant Orderly Liquidation Value for the third fiscal quarter of 2013. Pursuant to Amendment No. 5, the parties agree to amend the Credit Agreement as follows: (i) institute daily cash flow sweeps equal to 20 percent of daily cash deposits from operating activities and any cash deposits from Program subscriptions; (ii) use of a specified tiered portion of net proceeds of any equity offering of the capital stock to repay the principal outstanding under the Notes in accordance with the Principal Waterfall; (iii) pay interests in arrears by issuing additional notes; (iv) minimum quarterly production of ethanol at the Keyes Plant to be not less than 10 million gallons per fiscal quarter; (v) extend the Revolving Notes Stated Maturity Date to July 6, 2014; (vi) the February 2013 Special Advance and the April 2013 Special Advance, together with all interests thereon, will be due in full on the revised Revolving Notes Stated Maturity Date of July 6, 2014. In consideration for Amendment No. 5, the Borrowers, among other things, agreed to pay the Lenders: (i) waiver fee as at June 30, 2013, of $750,000 by issuing shares of common stock of the Company; (ii) amendment fee on June 30, 2013, of $3,000,000 payable in the form of additional Revolving Notes; (iii) extension fee on July 6, 2013, of $1,500,000.00 payable in the form of additional Revolving Notes; (iv) extension fee on Aug. 22, 2013 of $400,000 payable in cash or shares of common stock of the Company; and (v) extension fee on September 30, 2013 of $300,000 payable in cash or shares of common stock of the Company. A copy of the Amendment No. 5 is available for free at: http://is.gd/XoIBIv About Aemetis Cupertino, Calif.-based Aemetis, Inc., is an international renewable fuels and specialty chemical company focused on the production of advanced fuels and chemicals and the acquisition, development and commercialization of innovative technologies that replace traditional petroleum-based products and convert first- generation ethanol and biodiesel plants into advanced biorefineries. McGladrey LLP, in Des Moines, Iowa, expressed substantial doubt about Aemetis, Inc.'s ability to continue as a going concern following the annual results for the year ended Dec. 31, 2012. The independent auditors noted that the Company has suffered recurring losses from operations and its cash flows from operations are not sufficient to cover debt service requirements. The Company reported a net loss of $4.3 million on $189.0 million of revenues in 2012, compared with a net loss of $18.3 million on $141.9 million of revenues in 2011. AGFEED INDUSTRIES: Incentive Plan Approval Sought ------------------------------------------------- AgFeed Industries Inc. is seeking to pay top executives and other employees more than $650,000 in bonuses as they prepare to sell the company's assets at auction later this month. BankruptcyData reported that AgFeed Industries filed with the U.S. Bankruptcy Court a motion for entry of an order (i) authorizing the Debtors to honor obligations in connection with certain key executive employment and incentive agreements with Edward Pazdro and Gerard R. Daignault; (ii) approving the Debtor's key executive incentive plan (KEIP) and key manager incentive plan (KMIP) and (iii) authorizing payment of earned bonus program holdbacks to certain key executives. Under chief accounting officer Edward Pazdro's KEIP, Pazdro, upon a sale event, will be paid an amount equal to 12 months' salary. Under chief financial officer Gerald R. Daignault's KEIP, Daignault, upon a sale event, will be paid an amount equal to six month's salary. The motion explains, "In addition to their existing and ordinary course responsibilities, the KEIP Participants are also actively engaged in identifying, providing information to, and negotiating with potential purchasers, and in furtherance thereof, the KEIP Participants play a significant role in ongoing negotiations with such interested parties, the analysis of any potential bids, and the due diligence production that will be made in connection therewith.... The Debtors believe that the KMIP Participants are critical to realizing maximum value from the Sale or series of sales. Such individuals are responsible during the sale period for maintaining the Debtor's employment base, running certain key aspects of the Debtors' business on a day-to-day basis, assisting Debtor's counsel in the preparation of essential reporting and bankruptcy-related documents, responding to diligence request from potential buyers, and seamlessly transitioning the AgFeed USA assets (and related contracts, agreements and leases) to the ultimate purchaser of such assets. Specifically, upon the successful consummation and closing of the Sale or series of sales of the AgFeed USA assets, the KMIP Participant would be entitled to a one-time payment of $10,000." About Agfeed Industries AgFeed Industries, formerly known as M2 P2, LLC, is an international agribusiness with operations in the U.S. and China. AgFeed has two business lines: animal nutrition in premix, concentrates and complete feeds and hog production. In the U.S., AgFeed's hog production unit, M2P2, is a market leader in setting new standards for production efficiency and productivity. AgFeed believes the transfer of these processes, procedures and techniques will allow its new Western-style Chinese hog production units to set new standards for production in China. China is the world's largest pork market consuming 50 percent of global production and over 62 percent of total protein consumed in China is pork. Hog production in China currently enjoys income tax free status. AgFeed Industries, Inc., and its affiliates filed voluntary petitions under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case No. 13-11761) on July 15, 2013, with a deal to sell most of its subsidiaries to The Maschhoffs, LLC, for cash proceeds of $79 million, absent higher and better offers. The Debtors estimated assets of at least $100 million and debts of at least $50 million. Keith A. Maib signed the petition as chief restructuring officer. Hon. Brendan Linehan Shannon presides over the case. Donald J. Bowman, Jr., and Robert S. Brady, Esq., at Young, Conaway, Stargatt & Taylor, serve as the Debtors' counsel. BDA Advisors Inc. acts as the Debtors' financial advisor. The Debtors' claims and noticing agent is BMC Group, Inc. AGFEED INDUSTRIES: Gets Nod For Auction With $79MM Stalking Horse ----------------------------------------------------------------- Law360 reported that bankrupt AgFeed Industries Inc., a hog producer in the U.S. and China, won court approval for sales procedures that give parties three weeks to top the $79 million stalking-horse bid for the hog farmer's U.S. operations, fending off arguments that the auction terms would restrict competing offers. According to the report, at a hearing in Wilmington, U.S. Bankruptcy Judge Brendan L. Shannon signed off on AgFeed's proposed procedures, overruling objections that sought to extend the bid deadline and reduce the amount the stalking-horse bidder would receive if it failed to prevail at auction. As previously reported, a group of shareholders are opposing the sale terms, arguing that the proposed $79 million stalking horse bid significantly undervalues the hog producer. Specifically, the shareholders' group contended that the $79 million price is "well below comparable asset sales for similar assets." Although the shareholders said the price "may" pay secured creditors in full, the sale process should be stretched out to find a better offer and generate a higher price for unsecured creditors and stockholders. The shareholders' group also said that Agfeed might be worth up to $180 million, but finding a bidder to put up an adequate amount of money would be difficult. The Official Committee of Unsecured Creditors appointed in AgFeed's Chapter 11 cases supports a sale, although the panel said The Maschhoffs, LLC, as stalking horse bidder, is being offered a breakup fee that's too large. The equity group likewise called the breakup fee an impediment to competing offers. On AgFeed's July 15 Petition Date, it entered into an asset purchase agreement whereby the Company will sell most of its subsidiaries to Maschhoffs for cash proceeds of $79 million. The Company's operations in Oklahoma are not included in the sale. The Company is continuing to actively pursue competing offers for the sale of its businesses, including the Company's Chinese subsidiaries and assets as well as the remaining assets, primarily comprised of sow farm operations in Oklahoma. In the event the APA with Maschhoffs is terminated for reasons specified in the agreement, including if the Company accepts a higher or better offer from a competing bidder in the auction, the Company will be required to pay the Maschhoffs a break-up fee in an amount equal to $2,370,000 and reimburse the Maschhoffs for its reasonable and documented actual out-of-pocket expenses up to $790,000. Business Development Asia LLC and BDA Advisors Inc. serve as the Company's financial advisors. About Agfeed Industries AgFeed Industries, formerly known as M2 P2, LLC, is an international agribusiness with operations in the U.S. and China. AgFeed has two business lines: animal nutrition in premix, concentrates and complete feeds and hog production. In the U.S., AgFeed's hog production unit, M2P2, is a market leader in setting new standards for production efficiency and productivity. AgFeed believes the transfer of these processes, procedures and techniques will allow its new Western-style Chinese hog production units to set new standards for production in China. China is the world's largest pork market consuming 50 percent of global production and over 62 percent of total protein consumed in China is pork. Hog production in China currently enjoys income tax free status. AgFeed Industries, Inc., and its affiliates filed voluntary petitions under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case No. 13-11761) on July 15, 2013, with a deal to sell most of its subsidiaries to The Maschhoffs, LLC, for cash proceeds of $79 million, absent higher and better offers. The Debtors estimated assets of at least $100 million and debts of at least $50 million. Keith A. Maib signed the petition as chief restructuring officer. Hon. Brendan Linehan Shannon presides over the case. Donald J. Bowman, Jr., and Robert S. Brady, Esq., at Young, Conaway, Stargatt & Taylor, serve as the Debtors' counsel. BDA Advisors Inc. acts as the Debtors' financial advisor. The Debtors' claims and noticing agent is BMC Group, Inc. AGFEED INDUSTRIES: Hiring Approvals Sought ------------------------------------------ BankruptcyData reported that AgFeed Industries filed with the U.S. Bankruptcy Court motions to retain: -- Young Conaway Stargatt & Taylor (Contact: Robert S. Brady) as co-counsel at the following hourly rates: partner at $730, associate at $285 to $420 and paralegal at $175; -- Foley & Lardner (Contact: Selig D. Sacks) as attorney at the following hourly rates: partner at $500 to $950, senior counsel at $450 to $750, associate at $300 to $500 and paraprofessional at $175 to $280; -- BMC Group (Contact: Tinamarie Feil) as administrative advisor; -- BDA Advisors (Contact: Euan Rellie) as investment banker and financial advisor for a monthly retainer fee of $50,000 and a minimum success fee of $600,000 per transaction; and -- Mackinac Partners as restructuring advisor (Contact: Keith A. Maib) to provide the services of Keith A. Maib as chief restructuring officer at the following hourly rates: partner and senior managing director at $575 and managing director at $425 to $550. About Agfeed Industries AgFeed Industries, formerly known as M2 P2, LLC, is an international agribusiness with operations in the U.S. and China. AgFeed has two business lines: animal nutrition in premix, concentrates and complete feeds and hog production. In the U.S., AgFeed's hog production unit, M2P2, is a market leader in setting new standards for production efficiency and productivity. AgFeed believes the transfer of these processes, procedures and techniques will allow its new Western-style Chinese hog production units to set new standards for production in China. China is the world's largest pork market consuming 50 percent of global production and over 62 percent of total protein consumed in China is pork. Hog production in China currently enjoys income tax free status. AgFeed Industries, Inc., and its affiliates filed voluntary petitions under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case No. 13-11761) on July 15, 2013, with a deal to sell most of its subsidiaries to The Maschhoffs, LLC, for cash proceeds of $79 million, absent higher and better offers. The Debtors estimated assets of at least $100 million and debts of at least $50 million. Keith A. Maib signed the petition as chief restructuring officer. Hon. Brendan Linehan Shannon presides over the case. Donald J. Bowman, Jr., and Robert S. Brady, Esq., at Young, Conaway, Stargatt & Taylor, serve as the Debtors' counsel. BDA Advisors Inc. acts as the Debtors' financial advisor. The Debtors' claims and noticing agent is BMC Group, Inc. AIRTRONIC USA: Lightweight MK 777 Launcher Ready for Shipping ------------------------------------------------------------- Global Digital Solutions on Aug. 5 released a photograph showing the RPG-7(USA) -- manufactured by planned merger partner Airtronic USA, Inc. -- in use by the Peruvian Army. The companies also disclosed that Airtronic's second-generation RPG -- the breakthrough, lightweight MK 777 -- is expected to be ready for shipping in the second quarter of 2014. The Airtronic RPG-7 weighs 14.9 pounds, has an aluminum trigger group to reduce weight, and is compatible with all RPG-7 rounds currently available. Unlike every other RPG manufactured in the world, Airtronic's RPG-7 is machined from a tube of ordnance grade barrel steel, allowing it to fire 1,000 shots. All other RPG tubes are manufactured from castings, a small number of which will have voids that can cause the tubes to explode with potentially deadly consequences for operators. The Airtronic RPG-7 comes with a Picatinny rail system which allows the end user to upgrade the optics. In the accompanying Peru Army photograph, the operators have attached an Eotech sight to the Picatinny rail. Airtronic is currently delivering RPG-7 weapon systems to friendly foreign militaries. Airtronic's second-generation RPG -- currently in final testing -- is the lightweight, effective and affordable MK 777. This breakthrough weapon has the exact same form factor as the RPG-7 and uses the same aluminum trigger group. However, the MK 777 is made from a steel liner with a carbon composite wrap. This new material reduces the weight by half -- to 7.77 pounds -- hence the MK 777 name. The MK 777 is also compatible with all existing RPG- 7 rounds and has a Picatinny rail system for mounting upgraded optics. The company expects to begin shipping the MK 777 in the second quarter of 2014. "This photograph is indicative of Airtronic's long-standing relationships with selected militaries around the world," said GDSI founder and largest shareholder Richard J. Sullivan, who will become Chairman and CEO after the acquisition with Airtronic is completed. "As I commented in May when we announced a substantial Airtronic contract and again in June when we announced an OEM relationship and new purchase order, Airtronic has a strong track record of meeting critical customer needs for quality weapons- related products. And that's true with regard to the U.S. Department of Defense, various law enforcement agencies and several international military organizations." On May 30, 2013, GDSI and Airtronic announced the first in what is expected to be a series of contracts involving the company's core business products. On June 24, 2013, the two companies announced that Airtronic agreed to become an OEM supplier to a major international defense contractor for the Airtronic family of M203 grenade launchers and received the first of many expected orders for M203 grenade launchers. "An RPG-7 from Europe or Asia weighs about nine or ten pounds more than the MK 777," said Dr. Merriellyn Kett, Airtronic's President and CEO who is expected to continue serving as CEO after the merger between GDSI and Airtronic is finalized. "At tradeshows soldiers often tell me that I could never imagine the difference ten pounds makes when they have to cover ten kilometers on foot fast over difficult terrain. I always tell them that we can imagine the advantage of a lightweight weapon and that's exactly why Airtronic developed the MK 777." On or about August 13, 2012, GDSI and Airtronic announced that they had signed a letter of intent to enter into good faith discussions involving a potential strategic combination in which Airtronic would be acquired by GDSI. Having completed those good faith discussions, the companies signed a merger agreement on or about October 22, 2012. The companies are working together to file an Amended Plan of Reorganization. If confirmed, the Plan will allow Airtronic to emerge from chapter 11 bankruptcy with adequate working capital. About Airtronic USA, Inc. Airtronic -- http://www.Airtronic.net-- is an electro-mechanical engineering design and manufacturing company. The company provides small arms and small arms spare parts to the U.S. Department of Defense, foreign militaries, and the law enforcement market. The company also manufactures medical, avionics, and telecommunications original equipment. The company's products include grenade launchers, rocket propelled grenade launchers, grenade launcher guns, flex machine guns, grenade machine guns, rifles, and magazines. Founded in 1990, the company is based in Elk Grove Village, Illinois. On May 16, 2012, the voluntary petition of Airtronic, Inc. for liquidation under Chapter 7 was converted to chapter 11 reorganization. The company had filed for chapter 7 bankruptcy on March 13, 2012. ALLIED IRISH: Reports EUR758 Million Net Loss in H1 2013 -------------------------------------------------------- Allied Irish Banks incurred a net loss of EUR758 million on EUR595 million of net interest income for half-year June 2013, as compared with a net loss of EUR1.05 billion on EUR568 million of net interest income for half year June 2012. As of June 30, 2013, AIB had EUR120.60 billion in total assets, EUR110 billion in total liabilities and EUR10.59 billion in total shareholders' equity. AIB's Chief Executive, David Duffy, described the interim results as encouraging adding that he expects the positive performance to continue. "We are mid-way through a three year plan to return to sustainable profitability. While we have met our key strategic objectives to date, we acknowledge the continuing challenges that lie ahead. "The bank's results for the first half of 2013 demonstrate that our strategy for stabilisation and recovery is delivering results. We are seeing a steady improvement in our operating performance and a return to pre-provision operating profit. I expect that overall progress made in the first half of 2013 will continue through this year. "Although the economic environment remains challenging we have observed early positive trends in the SME, corporate and mortgage sectors. AIB approved over EUR3 billion in lending in the Irish market in the first half of 2013 and we are well positioned to actively support growth in the economy," he said. A copy of the Report is available for free at: http://is.gd/VNiMOn About Allied Irish Banks Allied Irish Banks, p.l.c. -- http://www.aibgroup.com/-- is a major commercial bank based in Ireland. It has an extensive branch network across the country, a head office in Dublin and a capital markets operation based in the International Financial Services Centre in Dublin. AIB also has retail and corporate businesses in the UK, offices in Europe and a subsidiary company in the Isle of Man and Jersey (Channel Islands). Since the onset of the global and Irish financial crisis, AIB's relationship with the Irish Government has changed significantly. As at Dec. 31, 2010, the Government, through the National Pension Reserve Fund Commission ("NPRFC"), held 49.9% of the ordinary shares of the Company (the share of the voting rights at shareholders' general meetings), 10,489,899,564 convertible non- voting ("CNV") shares and 3.5 billion 2009 Preference Shares. On April 8, 2011, the NPRFC converted the total outstanding amount of CNV shares into 10,489,899,564 ordinary shares of AIB, thereby increasing its holding to 92.8% of the ordinary share capital. In addition to its shareholders' interests, the Government's relationship with AIB is reflected through formal and informal oversight by the Minister and the Department of Finance and the Central Bank of Ireland, representation on the Board of Directors (three non-executive directors are Government nominees), participation in NAMA, and otherwise. The Company reported a loss of EUR2.29 billion in 2011, a loss of EUR10.16 billion in 2010, and a loss of EUR2.33 billion in 2009. ALLY FINANCIAL: Incurs $927 Million Net Loss in Second Quarter -------------------------------------------------------------- Ally Financial Inc. reported a net loss of $927 million for the second quarter of 2013, compared to net income of $1.1 billion in the prior quarter and a net loss of $898 million for the second quarter of 2012. The net loss for the quarter was driven by an approximately $1 billion loss from discontinued operations, primarily due to a $1.6 billion charge resulting from Ally's comprehensive settlement agreement in the ResCap Chapter 11 bankruptcy case. This was partially offset by approximately $600 million in tax benefits related to the settlement charge and the sales of certain of Ally's international businesses. Ally's core auto finance operations continued to generate strong year-over- year U.S. earning asset growth and improved U.S. net financing revenue for the quarter. "As we move into the second half of the year, Ally's strategic transformation is nearing completion," stated Chief Executive Officer Michael A. Carpenter. "The comprehensive settlement agreement between Ally, ResCap and ResCap's major creditors marked a watershed moment, and we can now put that tumultuous chapter behind us. In addition, the vast majority of the international businesses have been sold and 84 percent of the total expected proceeds were received. These actions have helped to strengthen Ally and best position the company to return the remaining investment to the U.S. taxpayer." "Our leading dealer financial services and direct banking franchises continued to demonstrate market leadership, posting strong results during the second quarter," Carpenter continued. "Ally's dealer financial services franchise is well-positioned in an intensely competitive market. U.S. net financing revenue and U.S. earning assets were up versus last year, demonstrating the strength of Ally's dealer-focused approach. "In addition, Ally Bank surpassed $40 billion in retail deposits earlier this month, marking a key milestone just four years after the brand was launched. During the quarter, the franchise saw its customer base grow 31 percent year-over-year, demonstrating the competitive power of Ally Bank's customer-centric business model." Carpenter concluded, "As we complete the final stages of Ally's transformation, we are devoting our full attention and resources toward strengthening and growing our leading franchises, which will enable the company to thrive in the future." A copy of the press release is available for free at: http://is.gd/MkC5Sh About Ally Financial Ally Financial Inc., formerly GMAC Inc. -- http://www.ally.com/-- is one of the world's largest automotive financial services companies. The company offers a full suite of automotive financing products and services in key markets around the world. Ally's other business units include mortgage operations and commercial finance, and the company's subsidiary, Ally Bank, offers online retail banking products. Ally operates as a bank holding company. GMAC obtained a $17 billion bailout from the U.S. government in exchange for a 56.3% stake. Private equity firm Cerberus Capital Management LP keeps 14.9%, while General Motors Co. owns 6.7%. * * * As reported by the TCR on Feb. 27, 2013, Moody's Investors Service confirmed the B1 corporate family and senior unsecured ratings of Ally Financial, Inc. and supported subsidiaries and assigned a positive rating outlook. In February 2012, Fitch Ratings downgraded the long-term Issuer Default Rating (IDR) and the senior unsecured debt rating of Ally Financial and its subsidiaries to 'BB-' from 'BB'. The Rating Outlook is Negative. The downgrade primarily reflects deteriorating operating trends in ResCap, which has continued to be a drag on Ally's consolidated credit profile, as well as exposure to contingent mortgage-related rep and warranty and litigation issues tied to ResCap, which could potentially impact Ally's capital and liquidity levels. In the Feb. 13, 2013, edition of the TCR, Fitch Ratings has maintained the Rating Watch Negative on Ally Financial Inc. including the Long-term IDR 'BB-'. As reported by the Troubled Company Reporter on May 22, 2012, Standard & Poor's Ratings Services revised its outlook on Ally Financial Inc. to positive from stable. At the same time, Standard & Poor's affirmed its ratings, including its 'B+' long- term counterparty credit and 'C' short-term ratings, on Ally. "The outlook revision reflects our view of potentially favorable implications for Ally's credit profile arising from measures the company announced May 14, 2012, designed to resolve issues relating to Residential Capital LLC, Ally's troubled mortgage subsidiary," said Standard & Poor's credit analyst Tom Connell. In the May 28, 2012 edition of the TCR, DBRS, Inc., has placed the ratings of Ally and certain related subsidiaries, including its Issuer and Long-Term Debt rating of BB (low), Under Review Developing. This rating action follows the decision by Ally's wholly owned mortgage subsidiary, Residential Capital to file a pre-packaged bankruptcy plan under Chapter 11 of the U.S. Bankruptcy Code. ALLY'S FINANCIAL: DBRS Assigns 'BB' Long Term Debt Rating --------------------------------------------------------- DBRS, Inc. has commented on the 2Q13 financial results of Ally Financial Inc. (Ally or the Company). DBRS rates Ally's Issuer and Long-Term Debt at BB. The trend on all ratings is Stable. For the quarter, Ally reported a net loss of $927 million compared to net income of $1.1 billion in the prior quarter and a net loss of $898 million a year ago. The quarter's results were impacted by a $1.6 billion charge related to the Company's previously announced comprehensive settlement agreement with the Residential Capital, LLC (ResCap) bankruptcy estate and ResCap's major creditors. The charge was partially offset by $600 million of tax benefits related to the settlement and the sale of certain international operations. While the size of the loss is notable, the loss was within DBRS's expectations. Excluding repositioning items, core pre-tax income (income from continuing operations before taxes and origination issue discount (OID) amortization expense), totaled $211 million, up marginally on a linked quarter basis, but 20% lower YoY. During the quarter, Ally made further progress in the strategic transformation of its business model. To this end, Ally completed the sale of its Mexican insurance business, as well as its remaining European operations, primarily in France. Meanwhile, the deals to sell the auto finance operations in Brazil, as well as the joint venture stake in China remain in process. Further, along with the comprehensive ResCap settlement, Ally completed the sale Ally Bank's (the Bank) agency MSR portfolio and ceased new mortgage originations during the quarter effectively exiting the residential mortgage origination and servicing business. At quarter end, Ally's only exposure to residential mortgages is the $8.8 billion of mortgages held for investment at the Bank. These actions are designed to simplify and streamline Ally's business, which DBRS views favorably, as it allows management to focus on growing its leading dealer focused U.S. auto finance business and direct bank franchise. On an operating basis, the Company's auto finance business reported solid results in a highly competitive marketplace. Consumer origination volumes were $9.8 billion across a broad range of origination channels. Earning assets were 10% higher YoY reflecting originations outpacing portfolio amortization. Commercial loans were down modestly, primarily due to lower dealer inventory levels as a result of strong retail sales. DBRS considers the solid origination volumes and growth in earning assets in the current environment as demonstrating the Company's ability to leverage its strong relationship with auto dealers. For the quarter, the Auto Finance segment generated pre-tax income of $382 million, an 11% improvement from the prior quarter, but 13% lower YoY. Importantly, while results were lower compared to the comparable period a year ago due to the absence of reserve releases and several other one-time items that benefited results a year ago, net financing revenue was higher both sequentially and YoY. Specifically, net financing revenue increased 1% QoQ and 12% YoY to $777 million. The positive trajectory in net financing revenue was underpinned by growth in earning assets and improving margins. While the net interest margin (NIM) was modestly lower QoQ largely due to one-time items, the NIM was 37 basis points (bps) higher YoY at 2.04% primarily reflecting reduced funding costs. To this end, Ally's cost of funds stood at 2.72% in 2Q13, which was 18 bps lower YoY. The Insurance segment reported pre-tax income of $45 million, down from $61 million in 1Q13 reflecting seasonally higher weather- related losses that was partially mitigated by higher investment income. Positively, the Dealer Products and Services business, (which provides dealer-centric products such as extended service contracts and floor plan insurance), wrote $276 million of premiums in 2Q13, the highest level since 2008. Moreover, wholesale insurance penetration levels remain high with 82% of U.S. dealers with Ally floorplan financing also utilizing floorplan insurance. Within the U.S. Retail Auto Finance portfolio, net charge-offs (NCO) continue to be near cyclical lows at 0.57%, a 12 bps improvement QoQ reflecting seasonal factors. While NCOs remain at low levels, NCOs were 23 bps higher YoY driven by a more balanced mix in originations, the seasoning of some larger vintages that are entering their peak loss periods, and a slight decline in used vehicle values during the quarter to more normalized levels. DBRS notes that the Company expects these trends to continue over the coming quarters leading to normalization in loss rates. Non- performing loans (NPL) were stable on a sequential basis at $1.0 billion. Company-wide provision for loan losses were 32% lower QoQ at $89 million due to lower losses primarily in the mortgage held for investment portfolio. Nevertheless, DBRS sees the reserve coverage as acceptable at 117.6% of NPLs. Ally's leading direct bank anchors the solid funding profile accounting for 40% of total funding with total deposits of $49.4 billion at June 30, 2013. During the quarter, retail deposit growth was solid expanding $1.1 billion and accounting for 81% of total deposits. For the eighth consecutive quarter, CD retention rates were strong at over 90%. At quarter-end, the Company's time to required funding was sound at over two years. DBRS notes that a priority of Ally going forward will be to reduce the presence of high cost debt in its capital structure, which should improve earnings. To this end, the Company recently issued $1.4 billion of unsecured senior debt using the proceeds to repay higher coupon SmartNotes. Capital ratios increased sequentially reflecting the benefits of the sale of the international operations, which more than offset the impact of the ResCap settlement. At June 20, 2013, the Company's Basel I Tier 1 Capital ratio was 15.4%, an 80 bps improvement from 1Q13. Risk-weighted assets were 11% lower QoQ at $127.2 billion reflecting the sale of certain international operations partially offset by earning asset growth. Ally's Tier 1 Common ratio was 8.0%, and pro-forma to the completion of the remaining international operation divestures was 8.9%. Regarding forthcoming regulatory capital requirements, Ally expects the impact of the recently finalized Basel III rules to have a minimal impact on its regulatory capital levels. Indeed, the Company estimates that the Basel III rules would have lowered its Tier 1 common ratio by only 20 to 40 bps at quarter-end. AMBAC FINANCIAL: US Trustee Looks to Shave Attorney's Fees ---------------------------------------------------------- Law360 reported that a U.S. trustee moved to trim the fat from nearly $12 million in fees requested by lawyers and other professionals in the bankruptcy case of New York-based bond insurer Ambac Financial Group Inc., taking aim at charges for everything from airfare to preparing the bill itself. Ambac is not responsible for hundreds of thousands of dollars in fees and expenses, the U.S. Trustee argues. About Ambac Financial Ambac Financial Group, Inc., headquartered in New York City, is a holding company whose affiliates provided financial guarantees and financial services to clients in both the public and private sectors around the world. Ambac Financial filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-15973) in Manhattan on Nov. 8, 2010. Ambac's bond insurance unit, Ambac Assurance Corp., is being restructured by state regulators in Wisconsin. AAC is domiciled in Wisconsin and regulated by the Office of the Commissioner of Insurance of the State of Wisconsin. The parent company is not regulated by the OCI. Bank of New York Mellon Corp., as trustee to seven different types of notes, is listed as the largest unsecured creditor, with claims totaling about US$1.62 billion. The Blackstone Group LP is the Debtor's financial advisor. Kurtzman Carson Consultants LLC is the claims and notice agent. KPMG LLP is tax consultant to the Debtor. Anthony Princi, Esq., Gary S. Lee, Esq., and Brett H. Miller, Esq., at Morrison & Foerster LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Lazard Freres & Co. LLC is the Committee's financial advisor. Bankruptcy Judge Shelley C. Chapman entered an order confirming the Fifth Amended Plan of Reorganization of Ambac Financial Group, Inc. on March 14, 2012. The Plan provides for the full payment of secured claims and 8.5% to 13.2% recovery for general unsecured claims. The second modified version of the confirmed Plan was declared effective on May 1, 2013, with Ambac obtaining bankruptcy court approval of a $100+ million claims settlement with the Internal Revenue Service. Bankruptcy Creditors' Service, Inc., publishes AMBAC BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding undertaken by Ambac Financial Group and the restructuring proceedings of Ambac Assurance Corp. (http://bankrupt.com/newsstand/or 215/945- 7000). AMERICAN AIRLINES: EU Approves AMR-USAir Merger ----------------------------------------------- AMR Corporation, the parent company of American Airlines, Inc., and US Airways Group, Inc. on Aug. 5 disclosed that they have received clearance from the European Commission under the EC Merger Regulation for their proposed merger. Tom Horton, chairman, president and CEO of AMR, and incoming Chairman of the Board of the combined company, said, "We are very pleased that the EU has approved the merger between American Airlines and US Airways. This represents one of the final milestones on our path to becoming the new American Airlines." Doug Parker, chairman and CEO of US Airways, and incoming CEO of the combined company, said, "The clearance by the European Commission is an important step toward closing this merger. The new American will benefit customers in the United States, Europe and across the world by enhancing connectivity within the oneworld alliance and creating more options for travel both domestically and internationally. We look forward to providing access to the best destinations in the world as the new American Airlines." As previously announced, AMR and US Airways agreed to combine to create the new American Airlines, a premier global carrier. Headquartered in Dallas/Fort Worth, the new American Airlines will become a highly competitive alternative for consumers to other global carriers and is expected to offer more than 6,700 daily flights to 336 destinations in 56 countries. The combined airline will offer customers more choices and increased service across a larger worldwide network and through an enhanced oneworld alliance. Together, American Airlines and US Airways are expected to operate a mainline fleet of almost 950 aircraft and employ more than 100,000 team members worldwide. The merger is subject to regulatory approvals, other customary closing conditions and confirmation of AMR's Plan of Reorganization by the U.S. Bankruptcy Court for the Southern District of New York. The companies continue to expect to complete the combination in the third quarter of 2013. Aug. 15 U.S. Court HEaring Susan Carey, writing for The Wall Street Journal, reports that because the combination would lead to a monopoly on the London- Philadelphia route, the European Commission said, the carriers have agreed to release a daily pair of takeoff and landing slots at London's congested Heathrow Airport to induce a new airline competitor to start service to Philadelphia. The two U.S. carriers also committed that they and their trans-Atlantic partners would enter into agreements to feed traffic to the new entrant, said EU Competition Commissioner Joaquin Almunia. The EU process of selecting a new airline hasn't begun, said a person familiar with the matter. WSJ notes AMR and US Airways also are awaiting clearance of the transaction by the U.S. Department of Justice, which hasn't signaled a time frame for its decision. The WSJ report notes the Justice Department has been reviewing the transaction for six months and sources familiar with the matter said the probe is nearing a head, as the government poses final questions, voices concerns and could entertain the prospect of concessions in return for its backing. According to the report, people familiar with the situation said one potential focus is the combined position of American and US Airways at Reagan National Airport near Washington, D.C. The two control about 50% of the seats and two-thirds of the flights at that airport, including two overlapping nonstop routes: to Raleigh-Durham, N.C. and Nashville, Tenn. Those two routes are among 12 nonstop domestic routes where the pair overlaps, seven of which currently have no other airlines flying them nonstop. The U.S. Bankruptcy Court in New York has scheduled an Aug. 15 hearing to confirm AMR's reorganization plan. 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 PETRO-HUNTER: Hanover to Sell 16.1MM Common Shares ----------------------------------------------------------- American Petro-Hunter Inc. registered with the U.S. Securities and Exchange Commission 16,182,230 shares of its common stock for resale by Hanover Holdings I, LLC, 14,417,524 of which are issuable to Hanover pursuant to the terms of the Common Stock Purchase Agreement, between the Company and Hanover, dated June 24, 2013, and 1,764,706 of which were issued to Hanover on March 22, 2013, in satisfaction of a $150,000 commitment fee paid to Hanover for entering into the Common Stock Purchase Agreement, between the Company and Hanover, dated March 22, 2013, based upon a price per share equal to $0.085 per share. The Company is not selling any securities under this prospectus and will not receive any of the proceeds from the resale of shares of its common stock by Hanover. However, the Company may receive gross proceeds of up to $5,000,000 from sales of its common stock to Hanover under the Purchase Agreement. The Company's common stock is quoted on the OTC Bulletin Board under the symbol "AAPH". The shares of the Company's common stock are being offered for sale by Hanover at prices established on the OTC Bulletin Board during the term of this offering. On July 30, 2013, the closing bid price of the Company's common stock was $0.01 per share. These prices will fluctuate based on the demand for the Company's common stock. A copy of the Form S-1 prospectus is available for free at: http://is.gd/ONJvMk About American Petro-Hunter Wichita, Kansas-based American Petro-Hunter, Inc., is an oil and natural gas exploration and production (E&P) company with current projects in Payne and Lincoln Counties in Oklahoma. American Petro-Hunter disclosed a net loss of $3.30 million on $308,770 of revenue for the year ended Dec. 31, 2012, as compared with a net loss of $2.73 million on $317,931 of revenue during the prior year. The Company's balance sheet at March 31, 2013, showed $1.78 million in total assets, $1.67 million in total liabilities and $107,336 in total stockholders' equity. Weaver Martin & Samyn, LLC, in Kansas City, Missouri, 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 and is dependent upon the continued sale of its securities or obtaining debt financing for funds to meet its cash requirements. These factors raise substantial doubt about the Company's ability to continue as a going concern. APPLIED DNA: Sells 5,500 Additional Preferred Shares to Crede ------------------------------------------------------------- Applied DNA Sciences, Inc., completed the second closing of its transaction with Crede CG III, Ltd., and sold 5,500 shares of Series B Convertible Preferred Stock to Crede at a price of $1,000 per share. The Company received gross proceeds of $5,500,000 less an investment fee of $265,000. The Company entered into a Securities Purchase Agreement with Crede dated July 19, 2013, pursuant to which Crede agreed to purchase the Series B Preferred after a registration statement covering the resale of all shares of Common Stock issuable pursuant to the Purchase Agreement, including those underlying the Series B Preferred and Series A, B and C Warrants, is declared effective by the SEC. The Company's registration statement on Form S-3 was declared effective by the SEC on July 31, 2013. Pursuant to the Purchase Agreement, Crede purchased at the initial closing held on July 19, 2013, 10,695,187 shares of the Company's common stock at a price of $.0.187 per share, resulting in gross proceeds to the Company of $2,000,000 less an investment fee of $100,000. A copy of the Form 8-K is available for free at: http://is.gd/CKl4DW About Applied DNA Stony Brook, N.Y.-based Applied DNA Sciences, Inc., is principally devoted to developing DNA embedded biotechnology security solutions in the United States. The Company's shares of common stock are quoted on the OTC Bulletin Board under the symbol "APDN." Applied DNA incurred a net loss of $7.15 million for the year ended Sept. 30, 2012, compared with a net loss of $10.51 million for the year ended Sept. 30, 2011. The Company's balance sheet at March 31, 2013, showed $5.07 million in total assets, $8.84 million in total liabilities and a $3.77 million total stockholders' deficit. AXESSTEL INC: Stockholders Elect Four Directors ----------------------------------------------- Axesstel, Inc., held its annual meeting of stockholders on July 29, 2013, at which the stockholders: (1) elected Mark Fruehan, Richard M. Gozia, Patrick Gray, Osmo Hautanen and Clark Hickock to serve until the next annual meeting of stockholders and until their respective successors are duly elected and qualified; (2) ratified the adoption of the Axesstel, Inc., 2013 Equity Incentive Plan; (3) ratified the selection of Gumbiner Savett, Inc., as the Company's independent registered public accounting firm for the fiscal year ending Dec. 31, 2013; (4) approved, on an advisory basis, the compensation paid to the Company's named executive officers; and (5) recommended, on an advisory basis, that stockholder advisory vote on executive compensation?be held every three years. About Axesstel Axesstel Inc., based in San Diego, Calif., develops fixed wireless voice and broadband access solutions for the worldwide telecommunications market. The Company's product portfolio includes fixed wireless phones, wire-line replacement terminals, and 3G and 4G broadband gateway devices used to access voice calling and high-speed data services. Axesstel disclosed net income of $4.31 million for the year ended Dec. 31, 2012, as compared with net income of $1.09 million during the prior year. The Company's balance sheet at March 31, 2013, showed $25.44 million in total assets, $31.84 million in total liabilities and a $6.39 million total stockholders' deficit. ARCAPITA BANK: Panel Has Court's OK to Prosecute Avoidance Claims ----------------------------------------------------------------- On Aug. 2, 2013, U.S. Bankruptcy Judge Sean H. Lane approved the motion of the Official Committee of Unsecured Creditors of Arcapita Bank B.S.C.(c), et al., for leave, standing and authority to prosecute certain claims on behalf of the Debtors' estates against (a) three banks: Al Baraka Islamic Bank, Tadhamon Capital, and Bahrain Islamic Bank; and (b) trustees Arcsukuk (2011-1) Limited and BNY Mellon Corporate Trustee Services Limited. As reported in the TCR on June 5, 2013, the Committee seeks to: (i) pursue claims against the Banks for, among other things, turnover of $33 million in proceeds that the Banks owe to Arcapita under certain prepetition short-term investment transactions, pursuant to which Arcapita deposited funds with the Banks in exchange for a promised return, (ii) pursue claims against the Arcsukuk Defendants to avoid a guarantee issued by Arcapita Investment Holdings Limited, a subsidiary of Arcapita. (iii) pursue a claim against the Arcsukuk Trustee with respect to transfers of cash from Arcapita to the Arcsukuk Trustee within the 90 days prior to the filing of the Debtors' chapter 11 petitions. The Debtors did not oppose the Committee's pursuit of the Claims. 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. As reported in the TCR on Jun 19, 2013, the Bankruptcy Court for the Southern District of New York entered its Findings of Fact, Conclusions of Law, and Order confirming the Second Amended Joint Chapter 11 Plan of Reorganization of Arcapita Bank B.S.C.(c) and Related Debtors with respect to teach Debtor other than Falcon Gas Storage Company, Inc. A copy of the Confirmed Second Amended Joint Plan (With First Technical Modifications) is available at: http://bankrupt.com/misc/arcapita.doc1265.pdf ARMORWORKS ENTERPRISES: Committee Can Retain Forrester as Counsel ----------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Arizona authorized the Official Joint Committee of Unsecured Creditors appointed in the Chapter 11 cases of Armorworks Enterprises, LLC, and TechFiber, LLC, to retain Forrester & Worth, P.L.L.C., as its general counsel. Forrester & Worth will: (a) advise the Committee in regard to its duties; (b) assist the Committee in any investigation that it deems necessary in regard to the acts, conduct, assets, liabilities, and financial condition of the debtors, their business operations, the desirability of the continuation of those operations, and any other matter relevant to the cases; (c) assist the Committee in the analysis of any plan of reorganization filed in the cases or in the formulation of a plan by the Committee; and (d) assist the Committee in requesting the appointment of a trustee or examiner, should that become necessary; and, (e) perform such other legal services as may be appropriate in the discharge of the Committee's duties. The members of Forrester & Worth are S. Cary Forrester, Esq. and John R. Worth, Esq. The current hourly rate for S. Cary Forrester, Esq., is $450 per hour. The current hourly rate for John R. Worth, Esq., is $400 per hour. The current hourly rate for the firm's paralegals is $125 per hour. About ArmorWorks Enterprises Military armor systems provider ArmorWorks Enterprises, LLC, and affiliate TechFiber LLC sought Chapter 11 protection (Bankr. D. Ariz. Case Nos. 13-10332 and 13-10333) in Phoenix on June 17, 2013, along with a plan that resolves a dispute with a minority shareholder and $3.5 million of financing that would save the company from running out of cash. ArmorWorks develops advanced survivability technology and designs and manufactures armor and protective products. ArmorWorks has produced over 1.25 million ceramic armor and composite armor protection components for a variety of personnel armor, aircraft, and vehicle applications. The Debtors have tapped Todd A. Burgess, Esq., at Gallagher & Kennedy, as counsel; and MCA Financial Group, Ltd., as financial advisor. ArmorWorks estimated $10 million to $50 million in assets and liabilities. As of May 26, 2012, ArmorWorks had total assets of $30.9 million and total liabilities of $12.04 million. The Plan would resolve the ongoing dispute with C Squared by allowing ArmorWorks to redeem C Squared's 40% minority interest, or alternatively, allow C Squared to purchase the 60% majority interest of AWI. ArmorWorks and TechFiber sought and obtained an order (i) transferring the In re TechFiber, LLC chapter 11 case to the Honorable Brenda Moody Whinery, the judge assigned to the ArmorWorks Chapter 11 case, and (ii) authorizing the joint administration of the Debtors' cases. ARMORWORKS ENTERPRISES: Panel Hires Sierra Consulting as Advisor ---------------------------------------------------------------- The Official Joint Committee of Unsecured Creditors appointed in the Chapter 11 cases of Armorworks Enterprises, LLC, and TechFiber, LLC, sought and obtained authority from the U.S. Bankruptcy Court for the District of Arizona to retain Sierra Consulting Group as financial advisor. The firm will be paid its customary rates ranging from $95 for paraprofessionals to $345 for directors. The firm will also be reimbursed for any necessary expenses incurred. The firm assured the Court that it is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and holds no interest materially adverse to the interests of the estate or of any class of creditors or equity security holders. About ArmorWorks Enterprises Military armor systems provider ArmorWorks Enterprises, LLC, and affiliate TechFiber LLC sought Chapter 11 protection (Bankr. D. Ariz. Case Nos. 13-10332 and 13-10333) in Phoenix on June 17, 2013, along with a plan that resolves a dispute with a minority shareholder and $3.5 million of financing that would save the company from running out of cash. ArmorWorks develops advanced survivability technology and designs and manufactures armor and protective products. ArmorWorks has produced over 1.25 million ceramic armor and composite armor protection components for a variety of personnel armor, aircraft, and vehicle applications. The Debtors have tapped Todd A. Burgess, Esq., at Gallagher & Kennedy, as counsel; and MCA Financial Group, Ltd., as financial advisor. ArmorWorks estimated $10 million to $50 million in assets and liabilities. As of May 26, 2012, ArmorWorks had total assets of $30.9 million and total liabilities of $12.04 million. The Plan would resolve the ongoing dispute with C Squared by allowing ArmorWorks to redeem C Squared's 40% minority interest, or alternatively, allow C Squared to purchase the 60% majority interest of AWI. ArmorWorks and TechFiber sought and obtained an order (i) transferring the In re TechFiber, LLC chapter 11 case to the Honorable Brenda Moody Whinery, the judge assigned to the ArmorWorks Chapter 11 case, and (ii) authorizing the joint administration of the Debtors' cases. ARMORWORKS ENTERPRISES: Employs Wittie Letsche as Special Counsel ----------------------------------------------------------------- Armorworks Enterprises, LLC, and TechFiber, LLC, seek authority from the U.S. Bankruptcy Court for the District of Arizona to employ Wittie, Letsche & Waldo, LLP, as special counsel. As special counsel, WLW will represent the Debtors in resolving protests they received regarding contracts awarded by the Department of the Air Force for the Air Force C-130 Armor Plate Program. The protests challenge Armorworks' small business status, which requires the U.S. Small Business Administration to make a determination as of the date of Armorworks' self- certification as small for the purposes of procurement. WLW anticipates that the following professionals may provide legal services in the course of the engagement at the following hourly rates: Patricia H. Wittie, Esq. -- pwittie@wlw-lawfirm.com $495 Daniel Strouse, Esq. -- dstrouse@wlw-lawfirm.com $240 WLW assures the Court that it 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. About ArmorWorks Enterprises Military armor systems provider ArmorWorks Enterprises, LLC, and affiliate TechFiber LLC sought Chapter 11 protection (Bankr. D. Ariz. Case Nos. 13-10332 and 13-10333) in Phoenix on June 17, 2013, along with a plan that resolves a dispute with a minority shareholder and $3.5 million of financing that would save the company from running out of cash. ArmorWorks develops advanced survivability technology and designs and manufactures armor and protective products. ArmorWorks has produced over 1.25 million ceramic armor and composite armor protection components for a variety of personnel armor, aircraft, and vehicle applications. The Debtors have tapped Todd A. Burgess, Esq., at Gallagher & Kennedy, as counsel; and MCA Financial Group, Ltd., as financial advisor. ArmorWorks estimated $10 million to $50 million in assets and liabilities. As of May 26, 2012, ArmorWorks had total assets of $30.9 million and total liabilities of $12.04 million. The Plan would resolve the ongoing dispute with C Squared by allowing ArmorWorks to redeem C Squared's 40% minority interest, or alternatively, allow C Squared to purchase the 60% majority interest of AWI. ArmorWorks and TechFiber sought and obtained an order (i) transferring the In re TechFiber, LLC chapter 11 case to the Honorable Brenda Moody Whinery, the judge assigned to the ArmorWorks Chapter 11 case, and (ii) authorizing the joint administration of the Debtors' cases. ASTRO TEL: Verizon Says Defunct Rival Can't Prove Antitrust Claims ------------------------------------------------------------------ Law360 reported that Verizon Communications Inc. urged a Florida federal judge to kill a lawsuit from Astro Tel Inc., arguing the defunct telephone service provider can't come close to proving that Verizon breached racketeering and antitrust laws by abusing its control of the state's telephone infrastructure. According to the report, Astro Tel, which purchased wholesale landline telephone service from Verizon's incumbent network, has claimed the company tried to snuff out competitors by limiting their ability to use necessary facilities and by making disparaging statements to customers. Verizon has previously claimed in its motion to dismiss the case that Astro Tel's Sherman Act allegations must fail because the U.S. Supreme Court has barred antitrust claims alleging insufficient access to elements of an incumbent local telephone company's network. The case is Astro Tel, Inc. v. Verizon Florida LLC et al., Case No. 8:11-cv-02224 (M.D. Fla.), before Judge Virginia M. Hernandez Cov. Astro Tel Inc. filed for Chapter 11 protection (Bankr. M.D. Fla. Case No. 10-29992) on Dec. 16, 2010, listing under $1 million in assets and debts. BALLARD POWER: Incurs $5.8-Mil. Net Loss in Second Quarter ---------------------------------------------------------- Ballard Power Systems Inc. reported a net loss of US$5.8 million on US$14.6 million of revenues for the three months ended June 30, 2013, compared with a net loss of US$7.0 million on US$6.8 million of revenues for the same period a year ago. According to the Company, the 114% increase in revenues was driven by significantly higher Telecom Backup Power, Engineering Services and Development Stage revenues which more than offset declines in Material Handling revenues The Company reported a net loss of US$14.2 million on US$26.9 million of revenue for the six months ended June 30, 2013, compared with a net loss of US$15.6 million on US$16.9 million of revenue for the corresponding period of 2012. The Company's balance sheet at June 30, 2013, showed US$122.2 million in total assets, US$64.6 million in total liabilities, and stockholders' equity of US$57.6 million. A copy of the Company's Second Quarter 2013 Financial Statements is available at http://is.gd/zk6bVI A copy of the Company's Second Quarter 2013 Management's Discussion and Analysis is available at http://is.gd/7tCaI3 About Ballard Power Systems Ballard Power Systems Inc. (NASDAQ: BLDP)(TSX: BLD), located in Burnaby, Canada, provides clean energy fuel cell products enabling optimized power systems for a range of applications. * * * As reported in the TCR on Feb. 25, 2013, KPMG LLP, in Vancouver, Canada, said the Company's ability to continue as a going concern and realize its assets and discharge its liabilities and commitments in the normal course of business is dependent on it having sufficient liquidity and achieving profitable operations that are sustainable. "These conditions indicate the existence of a material uncertainty that casts substantial doubt about the Company's ability to continue as a going concern." BANYAN RAIL: Posts $1.6 Million Net Income in First Quarter ----------------------------------------------------------- Banyan Rail Services Inc. filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing net income of $1.64 million for the three months ended March 31, 2013, as compared with a net loss of $170,468 for the same period during the prior year. As of March 31, 2013, the Company had $22,167 in total assets, $564,065 in total liabilities, all current, and a $541,898 total stockholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/Ej7h9h About Banyan Railway Boca Raton, Florida-based Banyan Rail Services Inc. owns 100% of the common stock of The Wood Energy Group, Inc. Wood Energy engages in the business of railroad tie reclamation and disposal, principally in the south and southwest. DaszkalBolton LLP, in Boca Raton, FL, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012. "The Company has a net capital deficiency and continues to experience recurring losses and negative cash flows from operations. In addition, subsequent to December 31, 2012, the operating subsidiary of the Company filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court Southern District of Florida, which consequently was converted to a case under Chapter 7 of the Bankruptcy Code. These matters raise substantial doubt about the Company's ability to continue as a going concern." BEAZER HOMES: Incurs $5.8 Million Net Loss in June 30 Quarter ------------------------------------------------------------- Beazer Homes USA, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $5.78 million on $314.43 million of total revenue for the three months ended June 30, 2013, as compared with a net loss of $39.88 million on $254.55 million of total revenue for the same period during the prior year. For the nine months ended June 30, 2013, the Company incurred a net loss of $45.81 million on $849.24 million of total revenue, as compared with a net loss of $79.09 million on $634.74 million of total revenue for the asme period a year ago. As of June 30, 2013, the Company had $1.94 billion in total assets, $1.71 billion in total liabilities and $227.98 million in total stockholders' equity. "We were pleased with the continued improvement in both our key operational metrics and our financial results for the third quarter," said Allan Merrill, CEO of Beazer Homes. "With improved homebuilding gross margins, higher average sales prices and strict control over operating expenses, we are poised to report positive net income in our fiscal fourth quarter and expect to report our first full year of profitability in nearly a decade for fiscal 2014." A copy of the Form 10-Q is available for free at: http://is.gd/ZMSRCe About Beazer Homes Beazer Homes USA, Inc. (NYSE: BZH) -- http://www.beazer.com/-- headquartered in Atlanta, is one of the country's 10 largest single-family homebuilders with continuing operations in Arizona, California, Delaware, Florida, Georgia, Indiana, Maryland, Nevada, New Jersey, New Mexico, North Carolina, Pennsylvania, South Carolina, Tennessee, Texas, and Virginia. Beazer Homes is listed on the New York Stock Exchange under the ticker symbol "BZH." Beazer Homes incurred a net loss of $145.32 million for the fiscal year ended Sept. 30, 2012, a net loss of $204.85 million for the fiscal year ended Sept. 30, 2011, and a net loss of $34.04 million for the fiscal year ended Sept. 30, 2010. * * * Beazer carries a 'B-' issuer credit rating, with "negative" outlook, from Standard & Poor's. In the Jan. 30, 2013, edition of the TCR, Moody's Investors Service raised Beazer Homes USA, Inc.'s corporate family rating to Caa1 from Caa2 and probability of default rating to Caa1-PD from Caa2-PD. The ratings upgrade reflects Moody's increasing confidence that Beazer's credit metrics, buoyed by a stregthening housing market, will gradually improve for at least the next two years and that the company may be able to return to a modestly profitable position as early as fiscal 2014. As reported by the TCR on Sept. 10, 2012, Fitch Ratings has upgraded the Issuer Default Rating (IDR) of Beazer Homes USA, Inc. (NYSE: BZH) to 'B-' from 'CCC'. The upgrade and the Stable Outlook reflect Beazer's operating performance so far this year, its robust cash position, and moderately better prospects for the housing sector during the remainder of this year and in 2013. The rating is also supported by the company's execution of its business model, land policies, and geographic diversity. BLUEJAY PROPERTIES: Bid for Loan Participants Committee Withdrawn ----------------------------------------------------------------- First Option Bank, Peoples State Bank and Lyndon State Bank have withdrawn their Feb. 6, 2013 motion directing the United States Trustee to appoint a Loan Participants' Committee in Bluejay Properties, LLC's Chapter 11 case. According to papers filed with the Court, the motion is withdrawn based upon the U.S. Bankruptcy Court for the District of Kansas's approval of the motion for intended compromise and settlement filed by the Debtor on July 15, 2013. About Bluejay Properties Based in Junction City, Kansas, Bluejay Properties, LLC, doing business as Quinton Point, filed a bare-bones Chapter 11 petition (Bankr. D. Kan. Case No. 12-22680) in Kansas City on Sept. 28, 2012. Bankruptcy Judge Robert D. Berger presides over the case. Todd A. Luckman, Esq., and Kathryn E. Sheedy, Esq., at Stumbo Hanson, LLP in Topeka. The Debtor owns the Quinton Point Apartment Complex in Kansas City valued at $17 million. The Debtor scheduled liabilities of $13,112,325. The petition was signed by Michael L. Thomas of TICC Prop., managing member. Bankers' Bank of Kansas, owed approximately $13.08 million, is represented by Arthur S. Chalmers of Hite, Fanning & Honeyman, LLP. The University National Bank, owed approximately $1.2 million, is represented by Edward J. Nazar of Redmond & Nazar, L.L.P., and Todd Thompson of Thompson Ramsdell & Qualseth, P.A. BLUEJAY PROPERTIES: Further Exclusivity Extension Won't Be Granted ------------------------------------------------------------------ On July 29, 2013, the U.S. Bankruptcy Court for the District of Kansas said in an order that any further extensions of exclusivity will not be granted to the Debtor, nor will be requested under exigent or changed circumstance, according to the agreed order. The Court entered an agreed journal entry and order extending Bluejay Properties, LLC's exclusive period to file a Plan of Reorganization until July 19, 2013. The statutory period for confirmation of the Plan will be accorded to the Debtor upon its submission of a Plan on or before July 19, 2013. As reported in the TCR on July 12, 2013, Bankers' Bank of Kansas, though Arthur S. Chalmers and Scott M. Hill of Hite, Fanning & Honeyman, L.L.P., objected to Bluejay's second motion for extension of its exclusivity periods. According to BBOK, the Debtor's second request is based on the complexity of pending litigation. However, BBOK asserts that a plan could be formulated to facilitate and expedite the litigation. Another creditor, The University National Bank stated that the failure of the Debtor to utilize a listing broker and offer the property to the marketplace, and instead to only negotiate with one prospective purchaser, has delayed and postponed an orderly sale of the property. Denying the exclusive right to the Debtor will allow creditors and parties in interest to offer other mechanisms for the timely sale of the property. About Bluejay Properties Based in Junction City, Kansas, Bluejay Properties, LLC, doing business as Quinton Point, filed a bare-bones Chapter 11 petition (Bankr. D. Kan. Case No. 12-22680) in Kansas City on Sept. 28, 2012. Bankruptcy Judge Robert D. Berger presides over the case. Todd A. Luckman, Esq., and Kathryn E. Sheedy, Esq., at Stumbo Hanson, LLP in Topeka. The Debtor owns the Quinton Point Apartment Complex in Kansas City valued at $17 million. The Debtor scheduled liabilities of $13,112,325. The petition was signed by Michael L. Thomas of TICC Prop., managing member. Bankers' Bank of Kansas, owed approximately $13.08 million, is represented by Arthur S. Chalmers of Hite, Fanning & Honeyman, LLP. The University National Bank, owed approximately $1.2 million, is represented by Edward J. Nazar of Redmond & Nazar, L.L.P., and Todd Thompson of Thompson Ramsdell & Qualseth, P.A. CASEY ANTHONY: Agrees to Pay $25,000 to Avoid Selling Life Story ---------------------------------------------------------------- Mike Schneider, writing for The Associated Press, reported that Casey Anthony has agreed to pay $25,000 to her bankruptcy estate to avoid having to sell her life story. According to the report, a judge in her bankruptcy case in Tampa approved the agreement between Anthony and her bankruptcy trustee in court papers. The report related that the trustee had considered the possibility of selling Anthony's life story to help pay off her debts to creditors. Anthony had opposed the idea, and her lawyers had argued that it would give the purchaser of the rights control over Anthony for the rest of her life. Anthony was acquitted two years ago of murder, manslaughter and child abuse charges in the death of her 2-year-old daughter, Caylee, in Orlando, the report further related. She has kept a low profile since. Papers filed in bankruptcy court said the compromise was reached to avoid protracted litigation over whether the trustee could legally force Anthony to sell her memoirs, the report said. About Casey Anthony Casey Marie Anthony, 26, was acquitted of murder in July 2011 in the death of her daughter, Caylee. She was released from jail several days later and disappeared from the spotlight. Anthony filed for Chapter 7 bankruptcy (Bankr. M.D. Fla. Case No. 13-00922) in Tampa, Florida, on Jan. 25, 2013, claiming $1,000 in assets and $792,000 in liabilities, most of those attorney's fees and costs. In February, Bankruptcy Judge K. Rodney May ruled against a motion by Zenaida Gonzalez, who's suing Ms. Anthony for defamation, to relocate the case to Orlando. CASPIAN SERVICES: Extends CEO's Employment for Three Years ---------------------------------------------------------- The Board of Directors of Caspian Services, Inc., approved Addendum #1 to the employment agreement of Alexey Kotov dated July 29, 2013, for the purpose of extending the term of Mr. Kotov's employment for an additional term of three years commencing on Aug. 1, 2013. Mr. Kotov is the Company's chief executive officer and president and serves on the Company's Board. The term of Mr. Kotov's existing employment agreement with the Company, which became effective as of Aug. 2, 2010, was for an initial term of three years. All other terms and conditions of Mr. Kotov's existing employment agreement are unchanged, remain in full force and effect and will continue through the term of Addendum #1. About Caspian Services Headquartered in Salt Lake City, Caspian Services, Inc., was incorporated under the laws of the state of Nevada on July 14, 1998. Since February 2002 the Company has concentrated its business efforts to provide diversified oilfield services to the oil and gas industry in western Kazakhstan and the Caspian Sea, including providing a fleet of vessels, onshore, transition zone and marine seismic data acquisition and processing services and a marine supply and support base in the port of Bautino, in Bautino Bay, Kazakhstan. The Company's balance sheet at March 31, 2013, showed $84.90 million in total assets, $87.98 million in total liabilities and a $3.08 million total deficit. Going Concern Uncertainty Under the terms of the EBRD Loan Agreement, as amended, Balykshi LLP, the Company's majority owned subsidiary, is required to repay the loan principal and accrued interest in eight equal semi-annual installments commencing Nov. 20, 2011, and then occurring each May 20 and November 20 thereafter until fully repaid. The first three semi-annual repayment installments, due Nov. 20, 2011, May 20, 2012, and Nov. 20, 2012, were not made. Additionally, an event of default may trigger the acceleration clause in the Put Option Agreement with EBRD which would allow EBRD to put its $10,000,000 investment in Balykshi back to the Company. If EBRD were to accelerate its put right, the Company could be obligated to repay the initial investment plus a 20% annual rate of return. The balance of accelerated put option liability was $18,326,000 and $17,822,000 as of Dec. 31, 2012, and Sept. 30, 2012. EBRD also previously notified the Company that it believes the Company and Balykshi are in violation of certain other covenants of the EBRD financing agreements. As of Feb. 19, 2013, to the Company's knowledge, EBRD has not sought to accelerate repayment of the loan or the put option. Should EBRD determine to exercise its acceleration rights or should the Loan Restructuring Agreement with an otherwise unrelated individual (the "Investor") not close, the Company currently has insufficient funds to repay its obligations to Investor or EBRD individually or collectively and would be forced to seek other sources of funds to satisfy these obligations. Given the Company's current and near-term anticipated operating results, the difficult credit and equity markets and the Company's current financial condition, the Company believes it would be very difficult to obtain new funding to satisfy these obligations. If the Company is unable to obtain funding to meet these obligations, Investor and or EBRD could seek any legal remedies available to them to obtain repayment, including forcing the Company into bankruptcy, or in the case of the EBRD loan, which is collateralized by the assets, including the marine base, and bank accounts of Balykshi and Caspian Real Estate, Ltd, foreclosure by EBRD on such assets and bank accounts. "The ability of the Company to continue as a going concern is dependent upon, among other things, its ability to successfully negotiate and conclude restructured financing agreements with EBRD and the Investor and its ability to generate sufficient revenue from operations, or to identify a financing source that will provide the Company the ability to satisfy its repayment and guarantee obligations under the restructured financing agreements. Uncertainty as to the outcome of these factors raises substantial doubt about the Company's ability to continue as a going concern," the Company said in its quarterly report for the period ended Dec. 31, 2012. CELL THERAPEUTICS: Incurs $18 Million Net Loss in Second Quarter ---------------------------------------------------------------- Cell Therapeutics, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss attributable to CTI common shareholders of $18.01 million on $306,000 of total revenues for the three months ended June 30, 2013, as compared with a net loss attributable to CTI common shareholders of $58.59 million on $0 of total revenues for the same period a year ago. For the six months ended June 30, 2013, the Company reported a net loss attributable to CTI common shareholders of $37.39 million on $1.43 million of total revenues, as compared with a net loss attributable to CTI common shareholders of $76.04 million on $0 of total revenues for the same period during the prior year. Cell Therapeutics incurred a net loss attributable to common shareholders of $115.27 million in 2012, a net loss attributable to common shareholders of $121.07 million in 2011, and a net loss attributable to common shareholders of $147.56 million in 2010. As of June 30, 2013, the Company had $49.23 million in total assets, $36.12 million in total liabilities $13.46 million in common stock purchase warrants and a $357,000 total shareholders' deficit. "The second quarter was highlighted by the substantial progress we made in our reimbursement discussions for PIXUVRI(R) (pixantrone) in Europe, specifically in the UK and Italy," said James Bianco, M.D., president and CEO of CTI. "In particular, we look forward to our planned launch of PIXUVRI in Italy, where AIFA granted market access to bring this new approved therapy to patients with aggressive B-cell non-Hodgkin lymphoma (NHL) who have failed 2 or 3 prior regimens. In addition, PERSIST-1, our randomized Phase 3 clinical trial designed to evaluate the safety and efficacy of pacritinib compared to best available therapy, excluding JAK inhibitors, continues to enroll patients with myelofibrosis. A second planned Phase 3 trial is on track to initiate later this year." Going Concern The Company's independent registered public accounting firm included an explanatory paragraph in its reports on the Company's consolidated financial statements for each of the years ended Dec. 31, 2007, through Dec. 31, 2011, regarding their substantial doubt as to the Company's ability to continue as a going concern. Although the Company's independent registered public accounting firm removed this going concern explanatory paragraph in its report on the Company's Dec. 31, 2012, consolidated financial statements, the Company expects to continue to need to raise additional financing to fund its operations and satisfy obligations as they become due. "The inclusion of a going concern explanatory paragraph in future years may negatively impact the trading price of our common stock and make it more difficult, time consuming or expensive to obtain necessary financing, and we cannot guarantee that we will not receive such an explanatory paragraph in the future," the Company said in the regulatory filing. The Company added that it may not be able to maintain its listings on The NASDAQ Capital Market and the Mercato Telematico Azionario stock market in Italy, or the MTA, or trading on these exchanges may otherwise be halted or suspended, which may make it more difficult for investors to sell shares of the Company's common stock. Bankruptcy Warning "We have acquired or licensed intellectual property from third parties, including patent applications relating to intellectual property for PIXUVRI, pacritinib, tosedostat, and brostallicin. We have also licensed the intellectual property for our drug delivery technology relating to Opaxio which uses polymers that are linked to drugs, known as polymer-drug conjugates. Some of our product development programs depend on our ability to maintain rights under these licenses. Each licensor has the power to terminate its agreement with us if we fail to meet our obligations under these licenses. We may not be able to meet our obligations under these licenses. If we default under any license agreement, we may lose our right to market and sell any products based on the licensed technology and may be forced to cease operations, liquidate our assets and possibly seek bankruptcy protection. Bankruptcy may result in the termination of agreements pursuant to which we license certain intellectual property rights, including the rights to PIXUVRI, Opaxio, tosedostat, and brostallicin," the Company maintained. A copy of the Form 10-Q is available for free at: http://is.gd/W8QyoH Cell Therapeutics provided certain information pursuant to a request from the Italian securities regulatory authority, CONSOB, pursuant to Article 114, Section 5 of the Italian Legislative Decree no. 58/98, that the Company issue at the end of each month a press release providing a monthly update of certain information relating to the Company's financial situation. The total estimated and unaudited net financial standing of CTI Parent Company as of June 30, 2013, was $13.1 million. The total estimated and unaudited net financial standing of CTI Consolidated Group as of June 30, 2013, was $14.2 million. During the month of June 2013, the Company's common stock, no par value, outstanding decreased by 2,147,178 shares. Consequently, the number of issued and outstanding shares of common stock as of June 30, 2013, was 114,781,036. A copy of the press release is available at: http://is.gd/9pntKi About Cell Therapeutics Headquartered in Seattle, Washington, Cell Therapeutics, Inc. (NASDAQ and MTA: CTIC) -- http://www.CellTherapeutics.com/-- is a biopharmaceutical company committed to developing an integrated portfolio of oncology products aimed at making cancer more treatable. CHRISTIAN RELIEF: S&P Affirms B Rating & Alters Outlook to Stable ----------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook to stable from negative on Wichita, Kan.'s (Christian Relief Services) series IX-A 1995 senior lien multifamily housing revenue bonds and IX-B 1995 multifamily revenue bonds, issued for the Brentwood Manor Project. At the same time, Standard & Poor's affirmed its 'B (sf)' and 'B- (sf)' long-term ratings on the IX-A 1995 and IX-B 1995 bonds, respectively. The ratings reflect Standard & Poor's view of these weaknesses: -- The project's receipt of advances from an affiliate to fulfill its fiscal 2011 financial obligations; and -- The low 90% occupancy during fiscal 2012. The ratings also reflect Standard & Poor's view of these strengths: -- The improving debt service coverage (DSC) of 1.24x and 1.22x maximum annual debt service (MADS) on the IX-A 1995 and IX-B 1995 bonds, respectively, based on 2012 audited financials; -- The debt service reserve fund funded at 12 months' MADS; and -- The moderate 60% loan-to-value ratio. "The stable outlook reflects our view of the project's improving DSC and occupancy," said Standard & Poor's credit analyst Raymond S. Kim. "If the project demonstrates sustained improvement in net operating income and DSC independent of advances from its parent company, we could raise the ratings. Conversely, should rental revenue and occupancy decline, we may lower the ratings." The project, located in Wichita, Kan., is owned and managed by an affiliate of Christian Relief Services. The garden-style complex consists of 196 units, with 20% of the units restricted to tenants earning below 50% of the area's median income. CLEAR CHANNEL: Posts $7.2 Million Net Income in Second Quarter -------------------------------------------------------------- Clear Channel Communications, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing net income attributable to the Company of $7.20 million on $1.61 billion of revenue for the three months ended June 30, 2013, as compared with a net loss attributable to the Company of $39.02 million on $1.60 billion of revenue for the same period during the prior year. For the six months ended June 30, 2013, the Company had a net loss attributable to the Company of $195.80 million on $2.96 billion of revenue, as compared with a net loss attributable to the Company of $182.65 million on $2.96 billion of revenue for the same period a year ago. As of June 30, 2013, the Company had $15.29 billion in total assets, $23.58 billion in total liabilities and a $8.28 billion total shareholders' deficit. "During the quarter, we made important progress across our businesses - delivering overall topline growth in a challenging market while strengthening our digital and national advertising capabilities for the future," said Bob Pittman, chairman and chief executive officer. "We are continuing to create innovative, multi-platform solutions for leading national marketers and brands. Emphasizing our focus on connecting consumers to their favorite stations, artists, and content wherever they are, iHeartRadio registered users were up 162% from last year's second quarter and reached the milestone of 30 million registered users in less than two years. Industry research shows that broadcast industry radio listening is also growing - up 9% over the last decade - and remains the #1 source of music discovery and the #1 listening choice in the car by a wide margin. At a time when consumers are spending more time out of their homes than ever - and expect to be connected wherever they are - both our Media+Entertainment and our Outdoor businesses continue to benefit from our leadership in that out-of-home sweet spot we're seeing globally. Outdoor generated strong results this quarter by leveraging its growing base of digital displays, both domestically and internationally. We also continued to improve our balance sheet with two opportunistic and transformative debt transactions, and we enhanced our liquidity through both operational improvements and the sale of non-core assets." A copy of the Form 10-Q is available for free at: http://is.gd/RaCqTX About Clear Channel Communications San Antonio, Texas-based Clear Channel Communications, Inc., an indirect subsidiary of CC Media Holdings, Inc. (OTCBB: CCMO), is one of the leading global media and entertainment companies specializing in radio, digital, outdoor, mobile, live events, and on-demand entertainment and information services for local communities and providing premier opportunities for advertisers. CC Media Holdings Inc. -- http://www.ccmediaholdings.com/-- is a global media and entertainment company. Its businesses include radio and outdoor displays. * * * In May 2013, Moody's Investors Service said that Clear Channel's upsize of the term loan D to $4 billion from $1.5 billion will not impact the Caa1 facility rating assigned. Clear Channel's Corporate Family Rating is unchanged at Caa2. The outlook remains stable. In May, Standard & Poor's Ratings Services also announced that its issue-level rating on San Antonio, Texas-based Clear Channel's senior secured term loan remains unchanged at 'CCC+' following the company's upsize of the loan to $4 billion from $1.5 billion. The rating on parent company CC Media Holdings remains at 'CCC+' with a negative outlook, which reflects the risks surrounding the long- term viability of the company's capital structure. COMMONWEALTH BANKSHARES: SEC Revokes Registration of Securities --------------------------------------------------------------- The U.S. Securities and Exchange Commission has revoked the registration of Commonwealth Bankshares, Inc.'s securities for failure to file any periodic reports since the period ended June 30, 2011. About Commonwealth Bankshares Norfolk, Va.-based Commonwealth Bankshares, Inc., (Nasdaq:CWBS) -- http://www.bankofthecommonwealth.com/-- is the parent of Bank of the Commonwealth which opened its first office in Norfolk, Virginia, in 1971. Bank of the Commonwealth has 21 bank branches strategically located throughout the Hampton Roads and Eastern North Carolina regions. The Company's balance sheet at June 30, 2011, showed $985.87 million in total assets, $990.17 million in total liabilities, and a $4.30 million total deficit. As reported by the TCR on May 31, 2011, Witt Mares, PLC, in Norfolk, Virginia, expressed substantial doubt about Commonwealth Bankshares' ability to continue as a going concern, following the Company's 2010 results. The independent auditors noted that of the Company's continued operating losses and deterioration of the loan portfolio, undercapitalized status, liquidity restrictions, and other restrictions as a result of regulatory agreements. Bankruptcy Warning Effective July 1, 2011, Bank of the Commonwealth entered into a Prompt Corrective Action Directive with the Board of Governors of the Federal Reserve System. The Directive requires that within 30 days of the effective date of the Directive or such additional time as the Board of Governors may permit, the Bank, in conjunction with the Company must, among other things, increase the Bank's equity through the sale of shares or contributions to surplus in an amount sufficient to make the Bank adequately capitalized. The Bank was not able to meet the 30-day timeline prescribed by the Directive for reaching the required capital levels. The Board of Governors, as outlined in the Directive, may permit additional time as they see fit. The Company and the Bank's management and Board of Directors have implemented a capital plan with various alternatives to reach and maintain the required capital levels. This plan was originally accepted by the Federal Reserve in 2010 in response to the Written Agreement. An updated capital restoration plan was submitted to the Federal Reserve in June 2011, due to the Company's immediate capital needs. This plan was not accepted by the Federal Reserve since the Company had not received any firm commitments for new capital. If the Company does not raise sufficient amounts of new equity capital, or alternatively, execute another strategic initiative, the Company may become subject to a voluntary or involuntary bankruptcy filing and the Company believes it is possible that the Bank could be placed into FDIC receivership by bank regulators or acquired by a third party in a transaction in which the Company receives no value for its interest in the Bank. CORPORATE EXECUTIVE: S&P Affirms 'BB-' CCR After Debt Amendments ---------------------------------------------------------------- Standard & Poor's Ratings Services said it affirmed its 'BB-' corporate credit rating on The Corporate Executive Board Co. The rating outlook is stable. At the same time, S&P affirmed its existing issue-level rating of 'BB-' (at the same level as the corporate credit rating) and recovery rating of '3' on CEB's extended and amended credit facilities. The recovery rating on this debt is '3', indicating S&P's expectation for meaningful (50% to 70%) recovery for lenders in the event of a payment default. Pro forma for the amendment and extension, the credit facilities consist of a $525 million (up from $270 million) term loan A due 2018 and a $200 million (up from $100 million) revolving credit facility due 2018. CEB plans to use $250 million of the proceeds to repay the remaining $250 million under its term loan B. "The 'BB-' rating reflects our expectation that CEB's operating performance will be solid, that it will generate good discretionary cash flow, and that it will gradually reduce debt leverage through a combination of EBITDA growth and debt repayment," said Standard & Poor's credit analyst Andy Liu. "We view CEB's business risk profile as "fair" (according to our criteria) based on the stable and diverse subscription revenues it derives from its research and benchmarking studies on operational improvement topics, high client subscription renewals, and good EBITDA margin. We view CEB's financial risk profile as "aggressive" based on its high debt leverage, a focus on returning cash to shareholders, and the potential, in our view, for ongoing acquisition activity. We expect CEB to continue increasing its dividend distributions to shareholders and to maintain an active share repurchase program," S&P noted. S&P assess the company's management and governance as "fair." The stable rating outlook reflects S&P's expectation that CEB will maintain debt leverage of about 4x, generate good discretionary cash flow, and maintain an adequate margin of compliance with covenants. S&P views the likelihood of an upgrade as somewhat higher than a downgrade over the intermediate to long term. S&P could raise its rating if CEB maintains operating momentum and profitability, and reduces debt leverage to less than 4x on a sustained basis. Also, an upgrade scenario would entail broadening the base of business through appropriately priced, synergistic acquisitions that don't meaningfully raise leverage. While not currently likely, S&P could lower the rating if debt leverage rises above 5x, which could occur if revenue growth slows and the EBITDA margin falls to about 20%. Large, debt-financed acquisitions or debt-financed dividends could also cause a downgrade. CROWN MEDIA: Posts $16.5 Million Net Income in Second Quarter ------------------------------------------------------------- Crown Media Holdings, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing net income attributable to common stockholders of $16.51 million on $89.47 million of net total revenue for the three months ended June 30, 2013, as compared with net income attributable to common stockholders of $13.47 million on $86.74 million of net total revenue for the same period during the prior year. For the six months ended June 30, 2013, the Company posted net income attributable to common stockholders of $31.04 million on $175.03 million of net total revenue as compared with net income attributable to common stockholders of $25.74 million on $170.51 million of net total revenue for the same period a year ago. As of June 30, 2013, the Company had $1 billion in total assets, $642.53 million in total liabilities and $362.40 million in total stockholders' equity. "Crown Media closed out a strong Second Quarter with an 11% increase to our EBITDA and solid revenue growth for Hallmark Channel and Hallmark Movie Channel in our Upfront negotiations," said Bill Abbott president and CEO, Crown Media Family Networks. "In addition viewers are connecting with our brand and both networks like never before: Hallmark Movie Channel continues to see record breaking ratings and we recently launched "Debbie Macomber's Cedar Cove", Hallmark Channel's first original scripted series in primetime, to stellar ratings, demonstrating there is a real appetite for wholesome episodic programming on the network. The success we have seen over the first two quarters sets us up nicely to build momentum in Third Quarter, through the rest of 2013, and well into the future." A copy of the Form 10-Q is available for free at: http://is.gd/jdMwlx About Crown Media Studio City, Calif.-based Crown Media Holdings, Inc. (NASDAQ: CRWN) -- http://www.hallmarkchannel.com/-- owns and operates cable television channels dedicated to high quality, broad appeal, entertainment programming. The Company currently operates and distributes Hallmark Channel in both high definition (HD) and standard definition (SD) to 90 million subscribers in the U.S. Crown Media also operates a second 24-hour linear channel, Hallmark Movie Channel, available in both HD and SD, which focuses on family-friendly movies with a mix of classic theatrical films, presentations from the acclaimed Hallmark Hall of Fame library, original Hallmark Channel movies and special events. Bankruptcy Warning "Our debt agreements contain restrictions that limit our flexibility in operating our business. Our senior secured credit facilities and the indenture governing the Notes contain a number of covenants that impose significant operating and financial restrictions on us, including restrictions on our ability to, among other things: * incur additional debt or issue certain preferred shares; * pay dividends on or make distributions in respect of the Company's capital stock or make other restricted payments; * make certain payments on debt that is subordinated or secured on a junior basis; * make certain investments; * sell certain assets; * create liens on certain assets; * consolidate, merge, sell or otherwise dispose of all or substantially all of our assets; * enter into certain transactions with our affiliates; and * designate our subsidiaries as unrestricted subsidiaries. Any of these restrictions could limit our ability to plan for or react to market conditions and could otherwise restrict corporate activities. Any failure to comply with these covenants could result in a default under our senior secured credit facilities and the indenture governing the Notes. Upon a default, unless waived, the lenders under our senior secured credit facilities could elect to terminate their commitments, cease making further loans, foreclose on our assets pledged to such lenders to secure our obligations under the senior secured credit facilities and force us into bankruptcy or liquidation," the Company said in its annual report for the year ended Dec. 31, 2012. * * * As reported by the TCR on May 28, 2012, Standard & Poor's Ratings Services raised its corporate credit rating on Studio City, Calif.-based cable network company Crown Media Holdings Inc. to 'B+' from 'B'. "The upgrade reflects Crown Media's recent operating performance, which achieved higher EBITDA and lower leverage than our expectations," said Standard & Poor's credit analyst Deborah Kinzer. Crown Media carries a B2 Corporate Family Rating from Moody's Investors Service. Crown Media's B2 CFR reflects the company's small size and niche market position among cable network operators, concentration in two Hallmark-branded channels, reliance on licensed third party content for a majority of its programming, and high leverage. DELL INC: Fitch Ratings Guidance Unaffected by Merger Agreement --------------------------------------------------------------- The increased price of $13.75 per share plus the guarantee of 21 cents in special and common dividends for Dell Inc. from Michael Dell and Silver Lake would be accommodated at the current ratings guidance range of 'B+' to 'BB-', according to Fitch Ratings. The increased purchase price and proposed dividends would have minimal impact on leverage. Fitch still believes the higher likelihood is for a 'B+' rating; however, the increase in price does not eliminate the possibility for a 'BB-' rating once the deal is consummated. Among other factors, final ratings will depend on Fitch's comfort with Dell's long-term enterprise strategy given its existing portfolio of products and services since resources for M&A could be limited, as well as risks related to cash burn from the company's struggling PC business and negative working capital balances. The new offer is still subject to approval by shareholders on Sept. 12, 2013. There is currently no indication that Carl Icahn and affiliates will vote for this revised proposal. However, Fitch believes the new shareholder record date of Aug. 13, 2013 and modification of the voting standard to reflect the majority of disinterested shares actually voting greatly increases the probability of obtaining shareholder approval for the leveraged buyout. Fitch originally placed Dell's 'BB+' rating on Negative Watch on Feb. 5, 2013. It was the committee's intention to maintain all ratings on Watch Negative should the transaction take more than six months to complete so long as no material changes to the credit occur in the interim. Given the adjournment of today's shareholder's vote, the Negative Watch will remain beyond six months. DETROIT, MI: Property Owners Can File Tax Appeals, Not Collect -------------------------------------------------------------- Andrew Dunn, writing for Bloomberg News, reported that Detroit property owners can file tax appeals against the city during its bankruptcy, a federal judge ruled, while barring them from collecting refunds. According to the report, Michigan Property Tax Relief LLC asked the judge overseeing Detroit's $18 billion bankruptcy to let its clients pursue their claims. The company said they have been blocked by the Michigan Tax Tribunal from challenging tax bills because of the bankruptcy. Lawsuits and other legal actions against Detroit were automatically halted when the city filed the biggest U.S. municipal bankruptcy on July 18, the report noted. U.S. Bankruptcy Judge Steven Rhodes today permitted property owners to "take all steps necessary to file property tax appeals." The company and its clients, however, "shall not take any action to prosecute the appeals or collect any refund of any pre-petition property tax overpayment absent further order of this court," Rhodes said in an order, the report related. About Detroit, Michigan The city of Detroit, Michigan, weighed down by more than $18 billion in accrued obligations, sought municipal bankruptcy protection on July 18, 2013, by filing a voluntary Chapter 9 petition (Bankr. E.D. Mich. Case No. 13-53846). Detroit listed more than $1 billion in both assets and debts. Kevyn Orr, who was appointed in March 2013 as Detroit's emergency manager, signed the petition. Detroit is represented by lawyers at Jones Day and Miller Canfield Paddock and Stone PLC. Michigan Governor Rick Snyder authorized the bankruptcy filing. The filing makes Detroit the largest American city to seek bankruptcy, in terms of population and the size of the debts and liabilities involved. The city's $18 billion in debt includes $5.85 billion in special revenue obligations, $6.4 billion in post-employment benefits, $3.5 billion for underfunded pensions, $1.13 billion on secured and unsecured general obligations, and $1.43 billion on pension- related debt, according to a court filing. Debt service consumes 42.5 percent of revenue. The city has 100,000 creditors and 20,000 retirees. The Debtor is represented by David G. Heiman, Esq., and Heather Lennox, Esq., at Jones Day, in Cleveland, Ohio; Bruce Bennett, Esq., at Jones Day, in Los Angeles, California; and Jonathan S. Green, Esq., and Stephen S. LaPlante, Esq., at Miller Canfield Paddock and Stone PLC, in Detroit, Michigan. DETROIT, MI: Mich. AG Sees No Conflict in Defending Retirees ------------------------------------------------------------ Nick Carey, writing for Reuters, reported that Michigan Attorney General Bill Schuette says he sees no conflict in representing the state's governor, who approved Detroit's bankruptcy filing, while at the same time representing Detroit's retirees, who assert that the filing is illegal. In both cases, Schuette said, he is defending Michigan's constitution, according to the report. He also pointed out that his office is often called upon to appear on conflicting sides of the same case. "You can't pick and choose which parts of the constitution to enforce," Schuette, a Republican, told Reuters in a telephone interview. "Constitutions aren't meant to be convenient -- they're meant to be followed, and I do that consistently." Earlier this month, Schuette defended Republican Governor Rick Snyder in three state court cases challenging the governor's power to approve a bankruptcy filing for Michigan's largest city by Detroit Emergency Manager Kevyn Orr, the report said. Detroit retirees, workers and the pension funds that filed the cases argue that the law empowering Snyder to approve the bankruptcy filing is unconstitutional because the bankruptcy threatens pension benefits, which are specifically protected by Michigan's constitution, the report further related. About Detroit, Michigan The city of Detroit, Michigan, weighed down by more than $18 billion in accrued obligations, sought municipal bankruptcy protection on July 18, 2013, by filing a voluntary Chapter 9 petition (Bankr. E.D. Mich. Case No. 13-53846). Detroit listed more than $1 billion in both assets and debts. Kevyn Orr, who was appointed in March 2013 as Detroit's emergency manager, signed the petition. Detroit is represented by lawyers at Jones Day and Miller Canfield Paddock and Stone PLC. Michigan Governor Rick Snyder authorized the bankruptcy filing. The filing makes Detroit the largest American city to seek bankruptcy, in terms of population and the size of the debts and liabilities involved. The city's $18 billion in debt includes $5.85 billion in special revenue obligations, $6.4 billion in post-employment benefits, $3.5 billion for underfunded pensions, $1.13 billion on secured and unsecured general obligations, and $1.43 billion on pension- related debt, according to a court filing. Debt service consumes 42.5 percent of revenue. The city has 100,000 creditors and 20,000 retirees. The Debtor is represented by David G. Heiman, Esq., and Heather Lennox, Esq., at Jones Day, in Cleveland, Ohio; Bruce Bennett, Esq., at Jones Day, in Los Angeles, California; and Jonathan S. Green, Esq., and Stephen S. LaPlante, Esq., at Miller Canfield Paddock and Stone PLC, in Detroit, Michigan. DETROIT, MI: PFRS Balks at Role of Retiree Committee ---------------------------------------------------- The Police and Fire Retirement System (PFRS) of the City of Detroit and the General Retirement System of the City of Detroit (GRS, and together with PFRS, the Retirement Systems) filed with the U.S. Bankruptcy Court a limited objection to the City of Detroit's motion for entry of an order directing the appointment of an official committee of retired employees. The limited objection states, "The Retirement Systems have concerns about the apparent proposed role of the Retiree Committee in the case and the process proposed to select the participants for the Retiree Committee, as described in the Retiree Committee Motion... In addition, the Retirement Systems object to the City's proposed involvement in the formation of the Retiree Committee, as proposed in the Retiree Committee Motion, including specifically the City's proposed involvement in identifying potential participants for the Retiree Committee. This function should be carried out by the Office of the U. S. Trustee, without any participation from the City, to ensure that the Retiree Committee is independent of the City. The Retirement Systems also object to the Retiree Committee Motion on the basis that, if a Retiree Committee is to be formed, there should be explicit and appropriate provisions (similar perhaps to those commonly found in a Chapter 11 case) for the City's payment of reasonable compensation to professionals hired by the Retiree Committee. No such provisions are proposed by the City." About Detroit, Michigan The city of Detroit, Michigan, weighed down by more than $18 billion in accrued obligations, sought municipal bankruptcy protection on July 18, 2013, by filing a voluntary Chapter 9 petition (Bankr. E.D. Mich. Case No. 13-53846). Detroit listed more than $1 billion in both assets and debts. Kevyn Orr, who was appointed in March 2013 as Detroit's emergency manager, signed the petition. Detroit is represented by lawyers at Jones Day and Miller Canfield Paddock and Stone PLC. Michigan Governor Rick Snyder authorized the bankruptcy filing. The filing makes Detroit the largest American city to seek bankruptcy, in terms of population and the size of the debts and liabilities involved. The city's $18 billion in debt includes $5.85 billion in special revenue obligations, $6.4 billion in post-employment benefits, $3.5 billion for underfunded pensions, $1.13 billion on secured and unsecured general obligations, and $1.43 billion on pension- related debt, according to a court filing. Debt service consumes 42.5 percent of revenue. The city has 100,000 creditors and 20,000 retirees. The Debtor is represented by David G. Heiman, Esq., and Heather Lennox, Esq., at Jones Day, in Cleveland, Ohio; Bruce Bennett, Esq., at Jones Day, in Los Angeles, California; and Jonathan S. Green, Esq., and Stephen S. LaPlante, Esq., at Miller Canfield Paddock and Stone PLC, in Detroit, Michigan. DETROIT, MI: Slashes Pay for Some Police, Firefighter Unions ------------------------------------------------------------ Joseph Lichterman, writing for Reuters, reported that about 1,200 Detroit police lieutenants and sergeants and about 400 Detroit firefighters will see a 10 percent pay cut in their paychecks on Sept. 16, a spokesman for Emergency Manager Kevyn Orr said. According to the report, the city informed the Detroit Police Lieutenants and Sergeants Association and the Detroit Firefighters Association of the pay cut along with a reduction in benefits. The Detroit Police Lieutenants and Sergeants Association's contract was slated to be terminated on July 6, but the city extended the contract for 30 days, the report related. Orr's spokesman, Bill Nowling, said the contract was extended to give new Detroit Police Chief James Craig, who started July 1, "an opportunity to get his feet on the ground," the report said. The firefighter union's contract expired June 30, but the 400 affected firefighters -- lieutenants, sergeants and captains -- have parity with the Lieutenants and Sergeants Association, so their contract was also subject to the delay, the report further related. About Detroit, Michigan The city of Detroit, Michigan, weighed down by more than $18 billion in accrued obligations, sought municipal bankruptcy protection on July 18, 2013, by filing a voluntary Chapter 9 petition (Bankr. E.D. Mich. Case No. 13-53846). Detroit listed more than $1 billion in both assets and debts. Kevyn Orr, who was appointed in March 2013 as Detroit's emergency manager, signed the petition. Detroit is represented by lawyers at Jones Day and Miller Canfield Paddock and Stone PLC. Michigan Governor Rick Snyder authorized the bankruptcy filing. The filing makes Detroit the largest American city to seek bankruptcy, in terms of population and the size of the debts and liabilities involved. The city's $18 billion in debt includes $5.85 billion in special revenue obligations, $6.4 billion in post-employment benefits, $3.5 billion for underfunded pensions, $1.13 billion on secured and unsecured general obligations, and $1.43 billion on pension- related debt, according to a court filing. Debt service consumes 42.5 percent of revenue. The city has 100,000 creditors and 20,000 retirees. The Debtor is represented by David G. Heiman, Esq., and Heather Lennox, Esq., at Jones Day, in Cleveland, Ohio; Bruce Bennett, Esq., at Jones Day, in Los Angeles, California; and Jonathan S. Green, Esq., and Stephen S. LaPlante, Esq., at Miller Canfield Paddock and Stone PLC, in Detroit, Michigan. DETROIT, MI: Congressional Democrats Seek to Boost Federal Aid -------------------------------------------------------------- Marisa Schultz, writing for The Detroit News, reported that Michigan's congressional Democrats are preparing a strategy to get more federal aid for Detroit as it faces the largest municipal bankruptcy in U.S. history and anti-bailout sentiment in Congress. According to the report, the Obama administration has said it won't rescue Michigan's largest city from its more than $18.5 billion in debt, while some Republicans in the U.S. Senate are pushing for legislation to ban Detroit bailout funding. Against this political backdrop, Michigan Democrats are planning to meet in an effort to generate more federal money for the city and find long-term solutions to help struggling cities. "We're going to be talking about it more this week," U.S. Rep. Sander Levin of Royal Oak said of the gathering of Michigan Democrats, the report related. "I think we need to sit down and carefully work this out and see if there is an appropriate federal role." The initiative faces unclear prospects with Michigan's nine GOP members in the Republican-controlled House, the report said. The state Republican representatives seem to be taking the lead from Gov. Rick Snyder and Detroit Emergency Manager Kevyn Orr, who have said they aren't asking for a federal bailout. Some GOP Michigan members of Congress argue the bankruptcy process is necessary for Detroit after decades of decline and the best thing Congress can do is to turn around the national economy, the report added. About Detroit, Michigan The city of Detroit, Michigan, weighed down by more than $18 billion in accrued obligations, sought municipal bankruptcy protection on July 18, 2013, by filing a voluntary Chapter 9 petition (Bankr. E.D. Mich. Case No. 13-53846). Detroit listed more than $1 billion in both assets and debts. Kevyn Orr, who was appointed in March 2013 as Detroit's emergency manager, signed the petition. Detroit is represented by lawyers at Jones Day and Miller Canfield Paddock and Stone PLC. Michigan Governor Rick Snyder authorized the bankruptcy filing. The filing makes Detroit the largest American city to seek bankruptcy, in terms of population and the size of the debts and liabilities involved. The city's $18 billion in debt includes $5.85 billion in special revenue obligations, $6.4 billion in post-employment benefits, $3.5 billion for underfunded pensions, $1.13 billion on secured and unsecured general obligations, and $1.43 billion on pension- related debt, according to a court filing. Debt service consumes 42.5 percent of revenue. The city has 100,000 creditors and 20,000 retirees. The Debtor is represented by David G. Heiman, Esq., and Heather Lennox, Esq., at Jones Day, in Cleveland, Ohio; Bruce Bennett, Esq., at Jones Day, in Los Angeles, California; and Jonathan S. Green, Esq., and Stephen S. LaPlante, Esq., at Miller Canfield Paddock and Stone PLC, in Detroit, Michigan. DETROIT, MI: Lawyers in Bankruptcy May Face Scrutiny on Fees ------------------------------------------------------------ Tom Hals, writing for Reuters, reported that Detroit's bankruptcy filing last month brought a double-barreled bonus for lawyers -- lots of much-needed work, and, due to a quirk of municipal bankruptcy law, no apparent need to disclose the fees they charge. But before lawyers from big-name firms could start totting up their billable hours, Judge Steven Rhodes made clear he wasn't happy with the lack of transparency, according to the report. He said he wants to appoint an examiner to make sure fees charged to the city are fully disclosed and reasonable. While fee examiners have been appointed in many of the biggest corporate bankruptcies, Rhodes appears to be the first judge to propose one in a Chapter 9 municipal bankruptcy, according to a search of the Westlaw legal database, the report related. Legal experts said making the appointment may stretch Rhodes' authority and that the city's lawyers would have grounds to contest an examiner, the report added. A spokesman for the U.S. Bankruptcy Court in Detroit said Rhodes would not comment. In reality, it is unlikely lawyers will object to added oversight given that they are being paid from taxpayer funds, the report said. In the overheated political atmosphere surrounding the case, having an independent examiner approve fees could give a degree of cover to lawyers who often bill as much as $1,000 an hour. About Detroit, Michigan The city of Detroit, Michigan, weighed down by more than $18 billion in accrued obligations, sought municipal bankruptcy protection on July 18, 2013, by filing a voluntary Chapter 9 petition (Bankr. E.D. Mich. Case No. 13-53846). Detroit listed more than $1 billion in both assets and debts. Kevyn Orr, who was appointed in March 2013 as Detroit's emergency manager, signed the petition. Detroit is represented by lawyers at Jones Day and Miller Canfield Paddock and Stone PLC. Michigan Governor Rick Snyder authorized the bankruptcy filing. The filing makes Detroit the largest American city to seek bankruptcy, in terms of population and the size of the debts and liabilities involved. The city's $18 billion in debt includes $5.85 billion in special revenue obligations, $6.4 billion in post-employment benefits, $3.5 billion for underfunded pensions, $1.13 billion on secured and unsecured general obligations, and $1.43 billion on pension- related debt, according to a court filing. Debt service consumes 42.5 percent of revenue. The city has 100,000 creditors and 20,000 retirees. The Debtor is represented by David G. Heiman, Esq., and Heather Lennox, Esq., at Jones Day, in Cleveland, Ohio; Bruce Bennett, Esq., at Jones Day, in Los Angeles, California; and Jonathan S. Green, Esq., and Stephen S. LaPlante, Esq., at Miller Canfield Paddock and Stone PLC, in Detroit, Michigan. DETROIT, MI: Hiring Christie's for Valuation of Art Collection -------------------------------------------------------------- The Wall Street Journal's Matthew Dolan and Kelly Crow report that the city of Detroit has hired Christie's to put a price-tag on the Detroit Institute of Arts' world-class art collection, stoking fears that the museum may be one step closer to auctioning off its world-class collection to raise money for the city's financial restructuring in bankruptcy court. According to WSJ, city officials confirmed Monday that Detroit will pay a branch of the London-based auction house $200,000 to spend the next three months valuing the city-owned portion of the collection at the museum. The DIA is one of the top encyclopedic museums in the country and its holdings include Egyptian statues, Caravaggio's 1598 masterpiece, "Martha and Mary Magdalene," and Auguste Rodin's bronze "The Thinker." According to WSJ, museum officials, who hired an attorney to represent its legal interests after Detroit filed for bankruptcy July 18 with more than $18 billion in liabilities, said the city couldn't force the museum into a fire-sale situation because its collection is held in "public trust," a position backed with a legal opinion from Michigan's attorney general. The report also relates that Bill Nowling, spokesman for Kevyn Orr, Detroit's emergency manager, said the appraisal process began informally when officials from Christie's visited the DIA in June. He said the city signed a contract directly with Christie's -- rather than reaching out to its rivals such as Sotheby's -- because the city deemed Christie's appraisers to be experienced enough to complete the task. He added that Christie's also has a good working relationship with Miller Buckfire, the investment banking firm hired by Detroit on its bankruptcy case filed in July. WSJ says Sotheby's officials declined to comment. About Detroit, Michigan The city of Detroit, Michigan, weighed down by more than $18 billion in accrued obligations, sought municipal bankruptcy protection on July 18, 2013, by filing a voluntary Chapter 9 petition (Bankr. E.D. Mich. Case No. 13-53846). Detroit listed more than $1 billion in both assets and debts. Kevyn Orr, who was appointed in March 2013 as Detroit's emergency manager, signed the petition. Detroit is represented by lawyers at Jones Day and Miller Canfield Paddock and Stone PLC. Michigan Governor Rick Snyder authorized the bankruptcy filing. The filing makes Detroit the largest American city to seek bankruptcy, in terms of population and the size of the debts and liabilities involved. The city's $18 billion in debt includes $5.85 billion in special revenue obligations, $6.4 billion in post-employment benefits, $3.5 billion for underfunded pensions, $1.13 billion on secured and unsecured general obligations, and $1.43 billion on pension- related debt, according to a court filing. Debt service consumes 42.5 percent of revenue. The city has 100,000 creditors and 20,000 retirees. The Debtor is represented by David G. Heiman, Esq., and Heather Lennox, Esq., at Jones Day, in Cleveland, Ohio; Bruce Bennett, Esq., at Jones Day, in Los Angeles, California; and Jonathan S. Green, Esq., and Stephen S. LaPlante, Esq., at Miller Canfield Paddock and Stone PLC, in Detroit, Michigan. Sharon Levine, Esq., at Lowenstein Sandler LLP, is representing the American Federation of State, County and Municipal Employees and the International Union. Babette Ceccotti, Esq., at Cohen, Weiss & Simon LLP, is representing the United Automobile, Aerospace and Agricultural Implement Workers of America. DIALOGIC INC: Had $10.4 Million Net Loss in First Quarter --------------------------------------------------------- Dialogic Inc. filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $10.36 million on $33.79 million of total revenue for the three months ended March 31, 2013, as compared with a net loss of $14.15 million on $42.05 million of total revenue for the same period during the prior year. Dialogic disclosed a net loss of $37.77 million in 2012, as compared with a net loss of $54.81 million in 2011. As of March 31, 2013, the Company had $110.98 million in total assets, $136.27 million in total liabilities and a $25.29 million total stockholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/I46H0Y Amends Form 10-K The Company has amended its annual report on Form 10-K/A to amend in its entirety Item 9A, "Controls and Procedures", of the Company's Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2012, as filed with the U.S. Securities and Exchange Commission on March 22, 2013. Subsequent to the filing of the 10-K on March 22, 2013, certain matters came to the Company's attention that indicated that material weaknesses existed at Dec. 31, 2012. In addition, as required by Rule 12b-15 under the Securities Exchange Act of 1934, as amended, new certifications by the Company's principal executive officer and principal accounting officer are filed as exhibits to the Amendment. A copy of the Amended Form 10-K is available for free at http://is.gd/BpEoi6 About Dialogic Milpitas, Cal.-based Dialogic Inc. provides communications platforms and technology that enable developers and service providers to build and deploy innovative applications without concern for the complexities of the communication medium or network. Bankruptcy Warning "If future covenant or other defaults occur under the Term Loan Agreement or under the Revolving Credit Agreement (the "Revolving Credit Agreement") with Wells Fargo Foothill Canada ULC (the "Revolving Credit Lender"), the Company does not anticipate having sufficient cash and cash equivalents to repay the debt under these agreements should it be accelerated and would be forced to restructure these agreements and/or seek alternative sources of financing. There can be no assurances that restructuring of the debt or alternative financing will be available on acceptable terms or at all. In the event of an acceleration of the Company's obligations under the Revolving Credit Agreement or Term Loan Agreement and the Company's failure to pay the amounts that would then become due, the Revolving Credit Lender and Term Loan Lenders could seek to foreclose on the Company's assets, as a result of which the Company would likely need to seek protection under the provisions of the U.S. Bankruptcy Code and/or its affiliates might be required to seek protection under the provisions of applicable bankruptcy codes," according to the Company's annual report for the period ended Dec. 31, 2012. DIALOGIC INC: FS Finans Holds 12.6% Ownership --------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, FS Finans III A/S disclosed that as of Oct. 1, 2010, it beneficially owned 2,004,338 shares of common stock of Dialogic Inc. representing 12.6 percent of the shares outstanding based upon 15,874,315 shares outstanding on April 5, 2013, as reported in the Company's Definitive Proxy Statement on Schedule 14A filed with the SEC on April 26, 2013. In connection with a scheme of arrangement, on April 8, 2013, FS Finans acquired all of the shares of common stock, $0.001 par value, of the Company from ApS Kbus 17 nr. 2101 as a set-off for a payment obligation under a loan agreement. The shares acquired from Kbus had been previously pledged to the FS Finans as of Oct. 1, 2010, pursuant a certain Pledge Agreement between the Reporting Person and Kbus, dated as of July 7, 2005, as subsequently amended. Pursuant to the terms of that certain Pledge Agreement between FS Finans and GW Invest ApS dated as of July 7, 2005, GW Invest as of Oct. 1, 2010, pledged all of its shares of common stock of the Company to FS Finans. By reason of its position as pledgee under the Pledge Agreement with GW Invest, FS Finance was granted the right to receive dividends and the power vote the common stock pledged by GW Invest. A copy of the regulatory filing is available for free at: http://is.gd/yU3GPM About Dialogic Milpitas, Cal.-based Dialogic Inc. provides communications platforms and technology that enable developers and service providers to build and deploy innovative applications without concern for the complexities of the communication medium or network. Dialogic disclosed a net loss of $37.77 million in 2012, as compared with a net loss of $54.81 million in 2011. As of March 31, 2013, the Company had $110.98 million in total assets, $136.27 million in total liabilities and a $25.29 million total stockholders' deficit. Bankruptcy Warning "If future covenant or other defaults occur under the Term Loan Agreement or under the Revolving Credit Agreement (the "Revolving Credit Agreement") with Wells Fargo Foothill Canada ULC (the "Revolving Credit Lender"), the Company does not anticipate having sufficient cash and cash equivalents to repay the debt under these agreements should it be accelerated and would be forced to restructure these agreements and/or seek alternative sources of financing. There can be no assurances that restructuring of the debt or alternative financing will be available on acceptable terms or at all. In the event of an acceleration of the Company's obligations under the Revolving Credit Agreement or Term Loan Agreement and the Company's failure to pay the amounts that would then become due, the Revolving Credit Lender and Term Loan Lenders could seek to foreclose on the Company's assets, as a result of which the Company would likely need to seek protection under the provisions of the U.S. Bankruptcy Code and/or its affiliates might be required to seek protection under the provisions of applicable bankruptcy codes," according to the Company's annual report for the period ended Dec. 31, 2012. DIALOGIC INC: ApS Kbus No Longer Owns Shares as of July 31 ---------------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, ApS Kbus 17 nr. 2101 and Nick Jensen disclosed that as of July 31, 2013, they do not beneficially own shares of common stock of Dialogic Inc. A copy of the amended regulatory filing is available at http://is.gd/cTX7fq About Dialogic Milpitas, Cal.-based Dialogic Inc. provides communications platforms and technology that enable developers and service providers to build and deploy innovative applications without concern for the complexities of the communication medium or network. Dialogic disclosed a net loss of $37.77 million in 2012, as compared with a net loss of $54.81 million in 2011. As of March 31, 2013, the Company had $110.98 million in total assets, $136.27 million in total liabilities and a $25.29 million total stockholders' deficit. Bankruptcy Warning "If future covenant or other defaults occur under the Term Loan Agreement or under the Revolving Credit Agreement (the "Revolving Credit Agreement") with Wells Fargo Foothill Canada ULC (the "Revolving Credit Lender"), the Company does not anticipate having sufficient cash and cash equivalents to repay the debt under these agreements should it be accelerated and would be forced to restructure these agreements and/or seek alternative sources of financing. There can be no assurances that restructuring of the debt or alternative financing will be available on acceptable terms or at all. In the event of an acceleration of the Company's obligations under the Revolving Credit Agreement or Term Loan Agreement and the Company's failure to pay the amounts that would then become due, the Revolving Credit Lender and Term Loan Lenders could seek to foreclose on the Company's assets, as a result of which the Company would likely need to seek protection under the provisions of the U.S. Bankruptcy Code and/or its affiliates might be required to seek protection under the provisions of applicable bankruptcy codes," according to the Company's annual report for the period ended Dec. 31, 2012. DUMA ENERGY: Pursuing Additional African Oil Concessions -------------------------------------------------------- Duma Energy Corp. has received an oil concession development report from its exploration partner, Hydrocarb Energy Corporation. In the last year, three main exploration plays in Africa have been identified, and an extensive geological and geophysical review has been done. Negotiations for possible production sharing contracts are ongoing in three major African countries. This past year, concession acquisition efforts have focused on basins that are part of the Central and East African rift systems. Additional evaluations of highly prospective areas in the offshore of West Africa are underway. All basins under review have proven active hydrocarbon systems and appear to have tremendous potential. Adjacent to the contract areas being pursued, there are proven reserves already discovered with billions of barrels. Many regions have ongoing infrastructure development projects to facilitate exploration, production and transportation of hydrocarbons. Hydrocarb's confidential report was based on the terms of a Petroleum Concession Consulting Agreement entered into in May of 2012 with Namibia Exploration, Inc. NEI was subsequently acquired by Duma. Under this same agreement, in August 2012, Duma (through its newly acquired subsidiary, NEI), gained a 39 percent working interest in Owambo blocks 1714A, 1715, 1814A, and 1815A in northern Namibia, covering an area over 5 million acres, roughly the size of Massachusetts. Recently an extensive aero-gravity and magnetics data acquisition program has been initiated over this concession. Internal work by Hydrocarb geoscientists estimate a resource potential of over one billion barrels of oil in place. Jeremy G. Driver, CEO of Duma stated, "We continue to search for major opportunities. Duma is focused on creating shareholder value by participating in international opportunities with significant potential. At the moment our partner, Hydrocarb Energy, is intensifying its efforts to finalize negotiations and sign PSCs that define new oil concessions with world-class potential. We are very excited with our partnership with Hydrocarb and the excellent opportunities they are securing in Africa." About Duma Energy Corpus Christi, Tex.-based Duma Energy Corp. -- http://www.duma.com/-- formerly Strategic American Oil Corporation, is a growth stage oil and natural gas exploration and production company with operations in Texas, Louisiana, and Illinois. The Company's team of geologists, engineers, and executives leverage 3D seismic data and other proven exploration and production technologies to locate and produce oil and natural gas in new and underexplored areas. Duma Energy incurred a net loss of $4.57 million for the year ended July 31, 2012, compared with a net loss of $10.28 million during the prior fiscal year. For the nine months ended April 30, 2013, the Company incurred a net loss of $39.23 million on $5.10 million of revenues. As of April 30, 2013, the Company had $25.78 million in total assets, $15.47 million in total liabilities and $10.30 million in total stockholders' equity. EASTMAN KODAK: Opposes Appointment of Equity Committee ------------------------------------------------------ Eastman Kodak Co. has lashed back at shareholders who are clamoring for the formation of a committee that would represent them in the company's Chapter 11 case. The U.S. Bankruptcy Court in Manhattan, which oversees Kodak's bankruptcy case, has been flooded lately with letters from shareholders who fear they will get nothing when the company exits bankruptcy protection. In a July 31 filing, Kodak asked Judge Allan Gropper to deny the appointment of an equity committee, saying it "constitutes extraordinary relief" given that the hearing to consider approval of its restructuring plan is just two weeks away. "There is no basis to appoint an equity committee at this late stage of the cases and to do so would be unfair to creditors," said Kodak lawyer, Andrew Dietderich, Esq., at Sullivan & Cromwell LLP, in New York. Mr. Dietderich said there is no likelihood that shareholders will receive "meaningful distribution in the case under a strict application of the absolute priority rule." The absolute priority rule is a rule which insists that a creditor's claim has an absolute priority over a shareholder's claim. The investors are paid only after the claims of the creditors are settled to the satisfaction of the bankruptcy court. According to Mr. Dietderich, even Kodak's unsecured creditors, who are entitled to full payment before shareholders, would only be paid about four to five cents on the dollar. The Kodak lawyer also refuted the shareholders' contention that Kodak is an "asset rich company" worth billions of dollars based on the value of its patents and real estate. Mr. Dietderich said the company already has granted licenses to virtually all of its patents to tech firms involved in the sale of its digital imaging assets, adding that the remaining patents cannot be licensed or sold since they are tied to the reorganized company's core businesses. The lawyer also clarified that Kodak doesn't have excess real estate to sell or develop that would create additional material value. The proposed appointment of an equity committee also drew objection from Kodak's official committee of unsecured creditors. The committee said Kodak is "hopelessly insolvent" which explains why unsecured creditors won't receive full payment for their claims, and why there is no likelihood of a "meaningful distribution" to shareholders. Judge Gropper was slated to hold a hearing on August 5 to consider the appointment of an equity committee. About Eastman Kodak Rochester, New York-based Eastman Kodak Company and its U.S. subsidiaries on Jan. 19, 2012, filed voluntarily Chapter 11 petitions (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan. Subsidiaries outside of the U.S. were not included in the filing and are expected to continue to operate as usual. Kodak, founded in 1880 by George Eastman, was once the world's leading producer of film and cameras. Kodak sought bankruptcy protection amid near-term liquidity issues brought about by steeper-than-expected declines in Kodak's historically profitable traditional businesses, and cash flow from the licensing and sale of intellectual property being delayed due to litigation tactics employed by a small number of infringing technology companies with strong balance sheets and an awareness of Kodak's liquidity challenges. In recent years, Kodak has been working to transform itself from a business primarily based on film and consumer photography to a smaller business with a digital growth strategy focused on the commercialization of proprietary digital imaging and printing technologies. Kodak has 8,900 patent and trademark registrations and applications in the United States, as well as 13,100 foreign patents and trademark registrations or pending registration in roughly 160 countries. Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Debtors. FTI Consulting, Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is the investment banker. Kurtzman Carson Consultants LLC is the claims agent. The Official Committee of Unsecured Creditors has tapped Milbank, Tweed, Hadley & McCloy LLP, as its bankruptcy counsel. Michael S. Stamer, Esq., David H. Botter, Esq., and Abid Qureshi, Esq., at Akin Gump Strauss Hauer & Feld LLP, represent the Unofficial Second Lien Noteholders Committee. The Retirees Committee has hired Haskell Slaughter Young & Rediker, LLC, and Arent Fox, LLC as Co-Counsel; Zolfo Cooper, LLC, as Bankruptcy Consultants and Financial Advisors; and the Segal Company, as Actuarial Advisors. Robert J. Stark, Esq., Andrew Dash, Esq., and Neal A. D'Amato, Esq., at Brown Rudnick LLP, represent Greywolf Capital Partners II; Greywolf Capital Overseas Master Fund; Richard Katz, Kenneth S. Grossman; and Paul Martin. Kodak completed the $527 million sale of digital-imaging technology on Feb. 1, 2013. Kodak intends to reorganize by focusing on the commercial printing business. At the end of April 2013, Kodak filed a proposed reorganization plan offering 85 percent of the stock to holders of the remaining $375 million in second-lien notes. The other 15 percent is for unsecured creditors with $2.7 billion in claims and retirees who have a $635 million claim from the loss of retirement benefits. EASTMAN KODAK: Seeks Additional Time to Remove Civil Actions ------------------------------------------------------------ Eastman Kodak Co. seeks additional time to remove civil actions that have not been automatically halted by the company's bankruptcy filing. Kodak proposes to extend the deadline to Dec. 9, 2013, or 30 days after entry of a court order terminating the automatic stay that was applied to the civil actions. As of Jan. 19, 2012, the company is involved in about 100 civil actions pending in U.S. federal and state courts. A court hearing is scheduled for Aug. 8. Objections are due Aug. 7. About Eastman Kodak Rochester, New York-based Eastman Kodak Company and its U.S. subsidiaries on Jan. 19, 2012, filed voluntarily Chapter 11 petitions (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan. Subsidiaries outside of the U.S. were not included in the filing and are expected to continue to operate as usual. Kodak, founded in 1880 by George Eastman, was once the world's leading producer of film and cameras. Kodak sought bankruptcy protection amid near-term liquidity issues brought about by steeper-than-expected declines in Kodak's historically profitable traditional businesses, and cash flow from the licensing and sale of intellectual property being delayed due to litigation tactics employed by a small number of infringing technology companies with strong balance sheets and an awareness of Kodak's liquidity challenges. In recent years, Kodak has been working to transform itself from a business primarily based on film and consumer photography to a smaller business with a digital growth strategy focused on the commercialization of proprietary digital imaging and printing technologies. Kodak has 8,900 patent and trademark registrations and applications in the United States, as well as 13,100 foreign patents and trademark registrations or pending registration in roughly 160 countries. Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Debtors. FTI Consulting, Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is the investment banker. Kurtzman Carson Consultants LLC is the claims agent. The Official Committee of Unsecured Creditors has tapped Milbank, Tweed, Hadley & McCloy LLP, as its bankruptcy counsel. Michael S. Stamer, Esq., David H. Botter, Esq., and Abid Qureshi, Esq., at Akin Gump Strauss Hauer & Feld LLP, represent the Unofficial Second Lien Noteholders Committee. The Retirees Committee has hired Haskell Slaughter Young & Rediker, LLC, and Arent Fox, LLC as Co-Counsel; Zolfo Cooper, LLC, as Bankruptcy Consultants and Financial Advisors; and the Segal Company, as Actuarial Advisors. Robert J. Stark, Esq., Andrew Dash, Esq., and Neal A. D'Amato, Esq., at Brown Rudnick LLP, represent Greywolf Capital Partners II; Greywolf Capital Overseas Master Fund; Richard Katz, Kenneth S. Grossman; and Paul Martin. Kodak completed the $527 million sale of digital-imaging technology on Feb. 1, 2013. Kodak intends to reorganize by focusing on the commercial printing business. At the end of April 2013, Kodak filed a proposed reorganization plan offering 85 percent of the stock to holders of the remaining $375 million in second-lien notes. The other 15 percent is for unsecured creditors with $2.7 billion in claims and retirees who have a $635 million claim from the loss of retirement benefits. EASTMAN KODAK: Seeks Court Approval to Expand E&Y Services ---------------------------------------------------------- Eastman Kodak Co. asked U.S. Bankruptcy Judge Allan Gropper to authorize Ernst & Young LLP to provide additional services to the company. The new services, if approved, would help Kodak analyze the value of its assets under a hypothetical forced liquidation scenario. The services include interviewing Kodak's senior management, conducting market research and preparing a valuation report. Kodak proposed to pay the firm for the additional services based on agreed hourly rates, and reimburse work-related expenses. The hourly rates range from $645 to $795 for partners, principals and directors; $570 to $675 for the executive director; $485 to $550 for senior managers; $425 to $475 for managers; $325 to $390 for seniors; and $200 to $280 for staff. About Eastman Kodak Rochester, New York-based Eastman Kodak Company and its U.S. subsidiaries on Jan. 19, 2012, filed voluntarily Chapter 11 petitions (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan. Subsidiaries outside of the U.S. were not included in the filing and are expected to continue to operate as usual. Kodak, founded in 1880 by George Eastman, was once the world's leading producer of film and cameras. Kodak sought bankruptcy protection amid near-term liquidity issues brought about by steeper-than-expected declines in Kodak's historically profitable traditional businesses, and cash flow from the licensing and sale of intellectual property being delayed due to litigation tactics employed by a small number of infringing technology companies with strong balance sheets and an awareness of Kodak's liquidity challenges. In recent years, Kodak has been working to transform itself from a business primarily based on film and consumer photography to a smaller business with a digital growth strategy focused on the commercialization of proprietary digital imaging and printing technologies. Kodak has 8,900 patent and trademark registrations and applications in the United States, as well as 13,100 foreign patents and trademark registrations or pending registration in roughly 160 countries. Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Debtors. FTI Consulting, Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is the investment banker. Kurtzman Carson Consultants LLC is the claims agent. The Official Committee of Unsecured Creditors has tapped Milbank, Tweed, Hadley & McCloy LLP, as its bankruptcy counsel. Michael S. Stamer, Esq., David H. Botter, Esq., and Abid Qureshi, Esq., at Akin Gump Strauss Hauer & Feld LLP, represent the Unofficial Second Lien Noteholders Committee. The Retirees Committee has hired Haskell Slaughter Young & Rediker, LLC, and Arent Fox, LLC as Co-Counsel; Zolfo Cooper, LLC, as Bankruptcy Consultants and Financial Advisors; and the Segal Company, as Actuarial Advisors. Robert J. Stark, Esq., Andrew Dash, Esq., and Neal A. D'Amato, Esq., at Brown Rudnick LLP, represent Greywolf Capital Partners II; Greywolf Capital Overseas Master Fund; Richard Katz, Kenneth S. Grossman; and Paul Martin. Kodak completed the $527 million sale of digital-imaging technology on Feb. 1, 2013. Kodak intends to reorganize by focusing on the commercial printing business. At the end of April 2013, Kodak filed a proposed reorganization plan offering 85 percent of the stock to holders of the remaining $375 million in second-lien notes. The other 15 percent is for unsecured creditors with $2.7 billion in claims and retirees who have a $635 million claim from the loss of retirement benefits. EDISON MISSION: Incurs $91 Million Net Loss in Second Quarter ------------------------------------------------------------- Edison Mission Energy and its subsidiaries filed with the U.S. Securities and Exchange Commission their quarterly report for the three- and six-month periods ended June 30, 2013. The Debtors reported a net loss attributable to EME common shareholder of $91 million on $315 million of operating revenues, as compared with a net loss attributable to EME common shareholder of $109 million on $324 million of operating revenues for the same period during the prior year. For the six months ended June 30, 2013, the Debtors incurred a net loss attributable to EME common shareholder of $180 million on $622 million of operating revenues, as compared with a net loss attributable to common shareholder of $193 million on $667 million of operating revenues for the same period a year ago. As of June 30, 2013, the Debtors had $7.52 billion in total assets, $6.84 billion in total liabilities and $679 million in total equity. A copy of the Form 10-Q is available for free at: http://is.gd/EVr61t 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. ELBIT IMAGING: Settles with Israeli Tax Authority for $2.2MM ------------------------------------------------------------ Elbit Imaging Ltd. and its subsidiaries have entered into a settlement agreement with the Israeli Tax Authority with regards to corporate income tax assessments received for the years 2004- 2009. The Settlement generally provides that the Company and its subsidiaries: (i) will pay taxes in the aggregate amount of NIS 8 million (approximately $2.2 million); (ii) the Company's capital and business losses carry forward for tax purposes as of Dec. 31,2009, will amount to approximately NIS 306 million (approximately $85.7 million); and (iii) the Company will capitalize expenses of NIS 450 million (approximately $126 million). About Elbit Imaging Tel-Aviv, Israel-based Elbit Imaging Ltd. (TASE, NASDAQ: EMITF) hold investments in real estate and medical companies. The Company, through its subsidiaries, also develops shopping and entertainment centers in Central Europe and invests in and manages hotels. Elbit Imaging disclosed a loss of NIS455.50 million on NIS671.08 million of total revenues for the year ended Dec. 31, 2012, as compared with a loss of NIS247.02 million on NIS586.90 million of total revenues for the year ended Dec. 31, 2011. The Company's balance sheet at Dec. 31, 2012, showed NIS7.09 billion in total assets, NIS5.67 billion in total liabilities, NIS309.60 million in equity to holders of the Company and NIS1.11 billion in noncontrolling interest. Brightman Almagor Zohar & Co., in Tel-Aviv, Israel, expressed substantial doubt about Elbit Imaging's ability to continue as a going concern following the financial results for the year ended Dec. 31, 2012. The Certified Public Accountants noted that in the period commencing Feb. 1, 2013, through Feb. 1, 2014, the Company is to repay its debenture holders NIS 599 million (principal and interest). "Said amount includes NIS 82 million originally payable on Feb. 21, 2013, that its repayment was suspended following a resolution of the Company's Board of Directors. The Company's Board also resolved to suspend any interest payments relating to all the Company's debentures. In addition, as of Dec. 31, 2012, the Company failed to comply with certain financial covenants relating to bank loans in the total amount as of such date of NIS 290 million. ELEPHANT TALK: To Convert $1 Million Loan to 1.8 Million Shares --------------------------------------------------------------- Elephant Talk Communications Corp. previously entered into a loan agreement with a member of its board of directors pursuant to which the Company borrowed a principal amount of EUR1,000,000 at an interest rate of 12 percent per annum and issued a warrant to the director to purchase 1,253,194 restricted shares of the Company's common stock, $0.00001 par value, exercisable at $1.03 per share for a term of five years, with a mandatory cash exercise after 12 months in the event the average closing bid price is $1.55 or higher for 10 consecutive trading days. The Company terminated the Loan Agreement and canceled the Warrant on July 14, 2013. In exchange for termination of the Loan Agreement, the Company entered into a Stock Purchase Agreement, dated July 15, 2013, with the director pursuant to which the Company agreed to convert the Principal Amount of the loan into 1,840,631 restricted shares of the Company's common stock. The closing of the Conversion will occur upon satisfaction or waiver of the customary closing conditions set forth in the Purchase Agreement. About Elephant Talk Lutz, Fla.-based Elephant Talk Communications, Inc. (OTC BB: ETAK) -- http://www.elephanttalk.com/-- is an international provider of business software and services to the telecommunications and financial services industry. Elephant Talk disclosed a net loss attributable to the Company of $23.13 million in 2012, a net loss attributable to the Company of $25.31 million in 2011 and a net loss attributable to the Company of $92.48 million in 2010. The Company's balance sheet at March 31, 2013, showed $34.47 million in total assets, $18.29 million in total liabilities, and $16.18 million in total stockholders' equity. BDO USA, LLP, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012. The independent auditors noted that the Company has suffered recurring losses from operations has an accumulated deficit of $203.3 million and continues to generate negative cash flows that raise substantial doubt about its ability to continue as a going concern. EMPIRE RESORTS: Option to Lease EPT Property Extended to Aug. 14 ---------------------------------------------------------------- The option agreement by and between Monticello Raceway Management, Inc., a wholly-owned subsidiary of Empire Resorts, Inc., and EPT Concord II, LLC, originally entered into on Dec. 21, 2011, was further amended by a letter agreement between the parties, dated July 30, 2013. Pursuant to the Option Agreement, EPT granted MRMI a sole and exclusive option to lease certain EPT property located in Sullivan County, New York, pursuant to the terms of a lease negotiated between the parties. Pursuant to the Letter Agreement, MRMI and EPT agreed to extend the option exercise period and the final option exercise outside date from July 30, 2013, to Aug. 14, 2013. Except for these amendments, the Option Agreement remains unchanged and in full force and effect. A copy of the Letter Agreement is available for free at: http://is.gd/27rBG6 About Empire Resorts Based in Monticello, New York, Empire Resorts, Inc. (NASDAQ: NYNY) -- http://www.empireresorts.com/-- owns and operates Monticello Casino & Raceway, a video gaming machine and harness racing track and casino located in Monticello, New York, 90 miles northwest of New York City. Empire Resorts reported a net loss applicable to common shares of $2.26 million in 2012, as compared with a net loss applicable to common shares of $1.57 million in 2011. The Company's balance sheet at March 31, 2013, showed $52.58 million in total assets, $28.14 million in total liabilities and $24.44 million in total stockholders' equity. ENDEAVOR ENERGY: S&P Assigns 'B+' CCR & Rates $300MM Notes 'B+' --------------------------------------------------------------- Standard & Poor's Ratings Services said that it assigned its 'B+' corporate credit rating to Midland, Texas-based Endeavor Energy Resources L.P. The outlook is stable. At the same time, S&P assigned a 'B+' issue rating and a '4' recovery rating to the $300 million senior unsecured notes due 2021, indicating its expectation of average (30% to 50%) recovery in the event of a payment default. S&P notes that if Endeavor were to issue an additional $100 million or more of senior unsecured notes the issue rating would fall to 'B', reflecting the fact that the recovery on the unsecured debt would decline to modest (10% to 30%), consistent with a recovery rating of '5'. S&P also assigned a 'BB' issue rating and a '1' recovery rating to the company's $1.4 billion secured credit facility, indicating a very high (90% to 100%) recovery. "We believe Endeavor will be able to prudently manage its capital spending and increase reserves and production over the next two years while maintaining moderate debt leverage and substantial interest coverage," said Standard & Poor's credit analyst Ben Tsocanos. An upgrade is constrained by Endeavor's limited scale and scope. S&P could raise ratings if Endeavor were able to meaningfully increase reserves to a level that is consistent with its higher rated peers, while adding geographic diversity. S&P could lower ratings if liquidity became constrained or financial leverage exceeded 4.5x debt to EBITDA, which could occur in a period of persistently low commodity prices coupled with no reduction in capital spending, or if investment failed to yield production and reserve growth. EPICEPT CORP: Defaults Under MidCap Loan Agreement Waived --------------------------------------------------------- EpiCept Corporation on Aug. 1 reported operating and financial results for the three and six months ended June 30, 2013, and provided an update on the Company's upcoming merger with Immune Pharmaceuticals, Ltd. Robert Cook, Interim President and CEO of EpiCept, commented, "Our excitement about the merger between EpiCept and Immune is growing as we get closer to the stockholder vote on August 6 and to the closing of the merger transaction shortly after obtaining stockholder approval. We believe the combination of our companies will benefit both sets of shareholders and will in particular provide EpiCept's stockholders with a great opportunity to participate in the antibody therapeutics sector, one of the most dynamic in the biotech industry. We look forward to our transition into a new company, Immune Pharmaceuticals, Inc, focused on these cutting-edge products." Mr. Cook added, "We are very pleased with the results of the vote to date with more than 93% of the votes cast so far in favor of the proposals. We fully anticipate that our Special Meeting of Stockholders on August 6 will result in our meeting the final conditions to the closing of this important transaction." Merger Update In November 2012, following the approval of the companies' respective boards of directors, EpiCept signed a merger agreement with Immune Pharmaceuticals Ltd., a private company based in Herzliya-Pituach, Israel and New York, NY. The terms of the merger agreement provide that, upon the closing of the transaction, EpiCept will issue shares of its common stock to Immune shareholders in exchange for all outstanding shares of Immune and issue options and warrants to purchase shares of its common stock in exchange for certain options and warrants to purchase shares of Immune. EpiCept stockholders will own approximately 19% of the combined company and Immune shareholders will own approximately 81%, calculated on an adjusted fully diluted basis. The merger ratio initially excludes the exercise or conversion of certain EpiCept options and warrants whose exercise/conversion prices equal or exceed $0.60 per EpiCept share. EpiCept mailed a definitive proxy in June 2013 to its stockholders seeking approval for a reverse stock split of 1:40. The reverse split should cause an increase in the price per share of EpiCept's common stock, and will support EpiCept's near term goal of relisting its shares on a U.S. national securities exchange. EpiCept is also seeking approval for a change in the name of the company to Immune Pharmaceuticals, Inc. (IPI). The companies currently anticipate that following receipt of stockholder approval the merger transaction will close during August 2013. Financial Condition EpiCept had approximately $0.2 million in cash and cash equivalents as of June 30, 2013. In addition, EpiCept's lender has restricted $0.6 million of the Company's cash, with which EpiCept is required to make monthly interest payments on its senior secured term loan. The Company received $0.5 million of net cash from Immune during the first six months of 2013 through the issuance of approximately 3.8 million shares of EpiCept common stock and an additional $0.6 million by entering into a loan pursuant to the merger agreement with Immune. Immune has raised $4.1 million since the beginning of 2013 in order to fund the associated merger costs and the on-going operations of both Immune and EpiCept through the merger closing. IPI intends to obtain funding to support approximately 18 months of operations. EpiCept's obligations under its outstanding loan with MidCap Financial LLC are expected to be assumed by IPI upon or shortly after the merger closing. EpiCept and Immune have agreed to indicative terms and conditions offered by MidCap Financial related to the loan's restructure. In July 2013, EpiCept and MidCap executed a Second Amendment to the Loan and Security Agreement in which the parties agreed that interest payments will continue to be made monthly and one half of the cash escrow will be returned to EpiCept upon the favorable stockholder vote to approve the final conditions to the closing of the merger. Any past defaults under the loan agreement have been waived and principal payments on the existing loan will begin September 1, 2013 if the agreement restructuring the loan has not been completed. Product Pipeline Following the completion of the merger, IPI's product portfolio will consist of the following products: -- Bertilimumab - a first in class monoclonal antibody (mAb) that targets eotaxin-1, a small protein that attracts and activates several sub-classes of immune cells, which are white blood cells that play a role in the development of several inflammatory diseases, including Crohn's Disease, ulcerative colitis, severe asthma and bullous pemphigoid, a dermatological auto-immune orphan condition with high unmet medical need. Eotaxin-1 has been shown to correlate with the severity of those diseases, which allows for selection of patients based on eotaxin-1 levels, a major step toward treatment personalization. Immune is currently initiating a multi-national Phase II trial of bertilimumab for the treatment of ulcerative colitis, and plans to initiate in late 2013 a Phase II trial for the treatment of bullous pemphigoid. Data from these trials is expected to report during 2014. -- NanomAbs - an antibody drug conjugate (ADC) platform designed to deliver cancer drugs specifically to tumor cells thereby improving efficacy and reducing off-target undesirable effects. Immune intends to continue development of its own candidates as well as to enter into partnerships where it will incorporate the partner's chemotherapeutic drug into the NanomAbs and/or power the partner's antibody with a drug-loaded nano-particle. -- AmiKet(TM) - a prescription topical analgesic cream designed to provide long-term relief from the pain of peripheral neuropathies, which affects more than 15 million people in the U.S. IPI will continue EpiCept's efforts to out license the product candidate for Phase III development and commercial marketing for the treatment of chemotherapy-induced peripheral neuropathic pain (CIPN) and possibly other peripheral neuropathies. AmiKet has obtained Fast Track status for the treatment of CIPN and is eligible for an FDA Special Protocol Assessment. AmiKet has also been granted orphan drug status for the treatment of post-herpetic neuralgia. -- Crolibulin - a vascular disruption agent that has demonstrated potent anti-tumor activity in both preclinical and early clinical studies. In December 2010 the National Cancer Institute initiated a Phase Ib/II trial for crolibulin to assess safety and efficacy in combination with cisplatin in patients with anaplastic thyroid cancer. The Phase I safety portion of the trial completed in early 2013, and the results were presented at the May 2013 ASCO meeting in Chicago. Immune believes that crolibulin may be a candidate for use with its NanomAb technology. IPI will have dual headquarters in Herzliya-Pituach, Israel and in the New York City area, with research laboratories in Rehovot, Israel. Daniel Teper, PharmD, Chief Executive Officer of Immune Pharmaceuticals Ltd., will be IPI's Chairman and CEO. Dr. David Sidransky, Director of Head and Neck Research Division, Professor of Oncology at the Johns Hopkins School of Medicine, and a former Vice Chairman of the Board of Directors of ImClone Systems, will be the Vice Chairman of the Board. The board of directors of the combined company will consist of Dr. Daniel Teper, Dr. David Sidransky, the remainder of the current board of directors of Immune, which consists of Herve de Kergrohen, Isaac Kobrin, Pierre Albouy and Ana Stancic, and Robert W. Cook, EpiCept's current Interim President, Chief Executive Officer and Chief Financial Officer, who will also serve as the Chief Financial Officer of IPI. IPI plans to assume EpiCept's common stock listings on the OTCQX and on the NASDAQ OMX Stockholm Exchange. Financial and Operating Highlights EpiCept's net loss attributable to common stockholders for the second quarter of 2013 was $1.7 million, or $0.01 per share, compared with net income attributable to common stockholders of $2.2 million, or $0.03 per share, for the second quarter of 2012. The net income attributable to common stockholders for the second quarter of 2012 included $0.8 million of deemed dividends on convertible preferred stock. EpiCept's net loss attributable to common stockholders for the six months ended June 30, 2013 was $2.8 million, or $0.03 per share, compared with a net loss attributable to common stockholders of $2.5 million, or $0.03 per share, for the six months ended June 30, 2012. The net loss attributable to common stockholders for the six months ended June 30, 2012 included $1.9 million of deemed dividends on convertible preferred stock. Second Quarter and Six Months 2013 vs. Second Quarter and Six Months 2012 Revenue The Company recognized revenue of $0.1 million and $6.6 million during the second quarters of 2013 and 2012, respectively. The Company recognized revenue of $0.5 million and $6.8 million during the six months ended June 30, 2013 and 2012, respectively. For the second quarter of 2013, revenue consisted primarily of the recognition of license fee payments previously received from the Company's partners. For the second quarter of 2012, revenue consisted primarily of license fee payments and product revenue from the sale of the Company's rights to Ceplene(R) to Meda AB. Cost of Goods Sold Cost of goods sold in the second quarter of 2013 and 2012 was zero and $0.4 million, respectively, consisting solely of the cost for Ceplene(R) inventory sold during the quarter. Selling, General and Administrative (SG&A) Expense SG&A expense in the second quarter of 2013 decreased by 36%, or $0.5 million, to $0.9 million from $1.4 million in the second quarter of 2012. The decrease was primarily attributable to lower salary and salary related expenses as the result of a reduction in staff and lower consulting expenses. SG&A expense in the six months ended June 30, 2013 decreased by 39%, or $1.1 million, to $1.7 million from $2.8 million in the six months ended June 30, 2012. The decrease was primarily attributable to lower salary and salary related expenses as the result of a reduction in staff and lower consulting expenses. The Company expects general and administrative expenses to remain at approximately current levels through the close of the merger with Immune. Research and Development (R&D) Expense R&D expense in the second quarter of 2013 decreased by 30%, or $0.3 million, to $0.7 million from $1.0 million in the second quarter of 2012. This decrease was primarily related to lower clinical trial expenses in connection with the sale of EpiCept's rights to Ceplene(R) in Europe and certain Pacific Rim countries in June 2012. R&D expense in the six months ended June 30, 2013 decreased by 57%, or $1.3 million, to $1.0 million from $2.3 million in the six months ended June 30, 2012. This decrease was primarily related to lower clinical trial expenses in connection with the sale of EpiCept's rights to Ceplene(R) in Europe and certain Pacific Rim countries in June 2012 and lower salary and salary related expenses as the result of a reduction in staff. The Company expects R&D expense to remain at approximately current levels through the close of the merger with Immune. Other Income (Expense) Other income (expense) in the second quarter of 2013 amounted to net expense of $0.2 million compared with net expense of $0.9 million in the second quarter of 2012. Other income (expense) in the six months ended June 30, 2013 amounted to net expense of $0.4 million compared with net expense of $1.9 million in the six months ended June 30, 2012. The primary component of other expense in 2013 was interest expense related primarily to the Company's senior secured term loan. The primary components of other expense in 2012 were warrant amendment expense of $0.9 million, interest expense of $0.7 million related primarily to the Company's senior secured term loan and a foreign exchange loss of $0.3 million. About EpiCept Corporation Tarrytown, N.Y.-based EpiCept Corporation (Nasdaq and Nasdaq OMX Stockholm Exchange: EPCT) -- http://www.epicept.com/-- is focused on the development and commercialization of pharmaceutical products for the treatment of cancer and pain. The Company's lead product is Ceplene(R), approved in the European Union for the remission maintenance and prevention of relapse in adult patients with Acute Myeloid Leukemia (AML) in first remission. In the United States, a pivotal trial is scheduled to commence in 2011. The Company has two other oncology drug candidates currently in clinical development that were discovered using in-house technology and have been shown to act as vascular disruption agents in a variety of solid tumors. The Company's pain portfolio includes EpiCept(TM) NP-1, a prescription topical analgesic cream in late-stage clinical development designed to provide effective long-term relief of pain associated with peripheral neuropathies. The Company incurred a loss attributable to common stockholders of $6.12 million on $7.80 million of total revenue for the year ended Dec. 31, 2012, as compared with a loss attributable to common stockholders of $15.65 million on $944,000 of total revenue during the prior year. The Company's balance sheet at March 31, 2013, showed $1.25 million in total assets, $15.86 million in total liabilities and a $14.61 million total stockholders' deficit. Deloitte & Touche LLP, in Parsippany, New Jersey, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012, citing recurring losses from operations and stockholders' deficit which raise substantial doubt about the Company's ability to continue as a going concern. EPICEPT CORP: Incurs $1.7 Million Net Loss in Second Quarter ------------------------------------------------------------ EpiCept Corporation reported a net loss of $1.68 million on $99,000 of total revenue for the three months ended June 30, 2013, as compared with net income of $2.95 million on $6.60 million of total revenue for the same period during the prior year. For the six months ended June 30, 2013, the Company incurred a net loss of $2.78 million on $475,000 of total revenue, as compared with a net loss of $569,000 on $6.84 million of total revenue for the same period a year ago. Robert Cook, interim president and CEO of EpiCept, commented, "Our excitement about the merger between EpiCept and Immune is growing as we get closer to the stockholder vote on August 6 and to the closing of the merger transaction shortly after obtaining stockholder approval. We believe the combination of our companies will benefit both sets of shareholders and will in particular provide EpiCept's stockholders with a great opportunity to participate in the antibody therapeutics sector, one of the most dynamic in the biotech industry. We look forward to our transition into a new company, Immune Pharmaceuticals, Inc, focused on these cutting-edge products." Mr. Cook added, "We are very pleased with the results of the vote to date with more than 93% of the votes cast so far in favor of the proposals. We fully anticipate that our Special Meeting of Stockholders on August 6 will result in our meeting the final conditions to the closing of this important transaction.' A copy of the press release is available for free at: http://is.gd/DN2vND About EpiCept Corporation Tarrytown, N.Y.-based EpiCept Corporation (Nasdaq and Nasdaq OMX Stockholm Exchange: EPCT) -- http://www.epicept.com/-- is focused on the development and commercialization of pharmaceutical products for the treatment of cancer and pain. The Company's lead product is Ceplene(R), approved in the European Union for the remission maintenance and prevention of relapse in adult patients with Acute Myeloid Leukemia (AML) in first remission. In the United States, a pivotal trial is scheduled to commence in 2011. The Company has two other oncology drug candidates currently in clinical development that were discovered using in-house technology and have been shown to act as vascular disruption agents in a variety of solid tumors. The Company's pain portfolio includes EpiCept(TM) NP-1, a prescription topical analgesic cream in late-stage clinical development designed to provide effective long-term relief of pain associated with peripheral neuropathies. The Company incurred a loss attributable to common stockholders of $6.12 million on $7.80 million of total revenue for the year ended Dec. 31, 2012, as compared with a loss attributable to common stockholders of $15.65 million on $944,000 of total revenue during the prior year. The Company's balance sheet at March 31, 2013, showed $1.25 million in total assets, $15.86 million in total liabilities and a $14.61 million total stockholders' deficit. Deloitte & Touche LLP, in Parsippany, New Jersey, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012, citing recurring losses from operations and stockholders' deficit which raise substantial doubt about the Company's ability to continue as a going concern. EXCEL MARITIME: Creditors Say Rival Plan In The Works ----------------------------------------------------- Maria Chutchian of BankruptcyLaw360 reported that creditors of Excel Maritime Carriers Ltd. said they are expecting bondholders to file a proposal that would rival the dry bulk shipper's pre- packaged reorganization plan, which the creditors contend is unconfirmable. The report said Excel's proposed plan, the company will receive up to a $50 million capital infusion and the release of another $30 million in restricted cash. Senior lenders will get a restructured $771 million credit facility and all stock in the reorganized company, according to court documents. But creditors say the plan is unfair, the report related. 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. Excel Maritime, filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 13-bk- 23060) on July 1, 2013, in New York after signing an agreement where secured lenders owed $771 million support a reorganization plan filed alongside the petition. Excel, which sought bankruptcy with a number of affiliates, has tapped Skadden, Arps, Slate, Meagher & Flom LLP, as counsel; Miller Buckfire & Co. LLC, as investment banker; and Global Maritime Partners Inc., as financial advisor. A five-member official committee of unsecured creditors was appointed by the U.S. Trustee. FIRST PHILADELPHIA: Wants Plan Filing Exclusivity Until Nov. 21 --------------------------------------------------------------- First Philadelphia Holdings, LLC, asks the U.S. Bankruptcy Court for the District of New Jersey to extend its exclusive periods to file and obtain acceptances of a Plan by an additional period of 90 days to Nov. 21, 2013, and Jan. 20, 2014, respectively. The Debtor's exclusive right to file a plan will expire on Aug. 23, 2013, and the Debtor's exclusive right to solicit acceptances of a Plan will expire on Oct. 22, 2013, pursuant to the Court's April 19, 2013 order granting the Debtor's first extension motion. On March 25, 2013, the Debtor filed its Disclosure Statement and Plan with the Court. On April 9, 2013, the Debtor's first secured creditor, Susquehanna Bank, filed an objection to the Disclosure Statement. On May 31, 2013, Susquehanna transferred, inter alia, its claim against the Debtor and its estate to an unrelated entity known as 6501 NSR, LLC. The notice of transfer of claim was filed on June 5, 2013. According to the Debtor, it has been working with 6501 NSR, LLC, in order to resolve the motion of Susquehanna to dismiss the Debtor's case or, in the alternative, for stay relief, and to file an amended disclosure statement and Plan. Accordingly, the hearing to consider the same have been adjourned to Aug. 20, 2013. The Liquidating Plan As reported in the TCR on April 19, 2013, the bankruptcy judge has approved the disclosure statement explaining First Philadelphia's Chapter 11 Plan of Liquidation. The Plan will be funded by the sale of the Debtor's real estate assets located at 6501 New State Road, a/k/a Tacony Street, in Philadelphia, Pennsylvania. The Debtor's 100% owner and managing member, George M. Diemer, has committed to fund a distribution to unsecured creditors in the amount of $20,000, thereby securing a dividend to unsecured creditors. As of March 25, 2013, the Debtor estimates the percentage distribution to general unsecured creditors to be 8.42%. If the Property is not sold on or before Dec. 26, 2013, except to the extent that Pennsylvania Infrastructure Investment Authority has been paid by some other means, and subject to the claims of the City of Philadelphia and Susquehanna Bank, the Debtor will surrender the Property and any other collateral securing the Penn Vest Claim in full settlement, satisfaction, release and discharge of all of its claims and liens. Mr. Diemer's interest in the Debtor is subordinated to the general unsecured claims and he will not receive any distribution under the Plan. Susquehanna Bank, a secured creditor of the Debtor, objected to the Liquidating Plan complaining that it is patently unconfirmable. The Bank pointed out that although the Debtor's bankruptcy Schedules shows the property having a value as of the Petition Date of $15,000,000, that figure does not represent the current fair market value. Integra Realty Resources opined that the Debtor's property has a value, as of Feb. 2, 2013, of $3,370,000. The Bank also noted that the Debtor does not have any liquid assets. The Bank complained that notwithstanding the lack of funds available to the Debtor upon confirmation, the Debtor puts forth a Plan which blindly proposes to pay immediately upon the Effective Date in cash priority tax claims, and allowed administrative claims, including all professionals? compensation reimbursement. A full-text copy of the Disclosure Statement dated March 25, 2013, is available for free at: http://bankrupt.com/misc/FIRSTPHILADELPHIAds0325.pdf About First Philadelphia First Philadelphia Holdings, LLC, is a Pennsylvania limited liability company formed on or about March 14, 2005. The Debtor is headquartered in New Jersey and is in the business of owning real estate located at 6501 New State Road a/k/a Tacony Street, Philadelphia, Pennsylvania. The Company filed a Chapter 11 petition (Bankr. D.N.J. Case No. 12-39767) on Dec. 21, 2012. The Debtor scheduled $15,000,000 in assets and $10,346,981 in liabilities as of the Chapter 11 filing. Judge Gloria M. Burns presides over the case. Maureen P. Steady, Esq., who has an office in Marlton, New Jersey, serves as the Debtor's bankruptcy counsel. In its schedules, the Debtor disclosed $15,000,000 in total assets and $10,346,981 in total liabilities. No official committee of unsecured creditors, trustee or examiner has been appointed in the Debtor's Chapter 11 case. FLOYD COUNTY, KY: Moody's Cuts General Obligation Ratings to Ba1 ---------------------------------------------------------------- Moody's Investors Service has downgraded to Ba1 from A2 the rating on Floyd County, KY's GO bonds, affecting $3.2 million in outstanding debt related to its Series 2010 General Obligation Bonds. The county has an additional $11.9 million in outstanding debt that is not rated by Moody's, but is included in its analysis. Moody's has subsequently withdrawn the Ba1 rating due to a lack of sufficient information. Rating Rationale: The downgrade to Ba1 reflects the county's reliance on volatile and declining intergovernmental revenues derived from coal severance taxes to subsidize its increasingly unbalanced operations. The rating also reflects substantial tax base concentration in coal mining and a weak socioeconomic profile, with poverty and unemployment levels much higher than state and national medians. The downgrade also captures significant risk related to county debt issued for the Thunder Ridge Racetrack. Moody's has subsequently withdrawn the Ba1 rating because it has insufficient or otherwise inadequate information to support the maintenance of the rating. The County's fiscal 2012 (ended 6/30/2012) audit is not expected to be available for at least several months, and there is not a historical track record of unaudited information corresponding to final audit reports. Strengths: - Low debt burden Challenges: - Narrow total governmental liquidity - Significant reliance on volatile mining-related revenues - Local economy concentrated in declining coal mining industry - Rising unemployment, coupled with high poverty and declining population - Debt structure includes weakly secured BANs that will require future market access - Delayed financial reporting The principal methodology used in this rating was General Obligation Bonds Issued by US Local Governments published in April 2013. FREDERICK'S OF HOLLYWOOD: Inks 3rd Amendment to Salus Credit Pact ----------------------------------------------------------------- Frederick's of Hollywood Group Inc., FOH Holdings, Inc., Frederick's of Hollywood, Inc., Frederick's of Hollywood Stores, Inc., and Hollywood Mail Order, LLC, entered into a Third Amendment to the Credit and Security Agreement, dated as of May 31, 2012, with Salus Capital Partners, LLC. The Third Amendment provides that there will be no minimum excess availability requirement until Oct. 31, 2013. In addition, through Oct. 31, 2013, the initial $1,500,000 of the outstanding balance of the advances under the line of credit will bear interest at 20 percent per annum, and thereafter at no less than 7 percent per annum. Concurrently with the execution of the Third Amendment, the Borrowers paid to Salus a one-time $50,000 cash fee in consideration for Salus' agreement to enter into the Third Amendment. A copy of the Third Amendment is available for free at: http://is.gd/yNSDji About Frederick's of Hollywood Frederick's of Hollywood Group Inc. (NYSE Amex: FOH) -- http://www.fredericks.com/-- through its subsidiaries, sells women's intimate apparel, swimwear and related products under its proprietary Frederick's of Hollywood brand through 122 specialty retail stores, a world-famous catalog and an online shop. Frederick's of Hollywood sought bankruptcy in July 10, 2000. On Dec. 18, 2002, the court approved the company's plan of reorganization, which became effective on Jan. 7, 2003, with the closing of the Wells Fargo Retail Finance exit financing facility. The Company incurred a net loss of $6.43 million on $111.40 million of net sales for the year ended July 28, 2012, compared with a net loss of $12.05 million on $119.61 million of net sales for the year ended July 30, 2011. The Company's balance sheet at July 28, 2012, showed $41.47 million in total assets, $42.25 million in total liabilities and a $783,000 total shareholders' deficiency. FREESEAS INC: Issues 775,000 Add'l Settlement Shares to Hanover --------------------------------------------------------------- FreeSeas Inc. issued to Hanover Holdings I, LLC, 775,000 additional settlement shares pursuant to the terms of the settlement agreement approved by the Supreme Court of the State of New York, County of New York, on June 25, 2013. The Order approved, among other things, the settlement between FreeSeas and Hanover in the matter entitled Hanover Holdings I, LLC v. FreeSeas Inc., Case No. 651950/2013. Hanover commenced the Action against the Company on May 31, 2013, to recover an aggregate of $5,331,011 of past-due accounts payable of the Company, plus fees and costs. The Order provides for the full and final settlement of the Claim and the Action. On June 26, 2013, the Company issued and delivered to Hanover 890,000 shares of the Company's common stock, $0.001 par value, and between July 2, 2013, and July 29, 2013, the Company issued and delivered to Hanover an aggregate of 6,983,000 additional settlement Shares. A copy of the Form 6-K is available for free at: http://is.gd/WC7iOw FreeSeas registered with the U.S. Securities and Exchange Commission 500,000 shares of common stock issuable to Marc J. Ross. Sichenzia Ross Friedman Ference LLP is acting as counsel to FreeSeas connection with United States securities laws. Attorneys employed by this law firm are presently entitled to receive 500,000 shares of common stock, all of which are issuable pursuant to the Consulting Agreement entered into between the Company and Mr. Ross, a partner of Sichenzia Ross Friedman Ference LLP. A copy of the Form S-8 prospectus is available for free at: http://is.gd/SUef1j About FreeSeas Inc. Headquartered in Athens, Greece, FreeSeas Inc., formerly known as Adventure Holdings S.A., was incorporated in the Marshall Islands on April 23, 2004, for the purpose of being the ultimate holding company of ship-owning companies. The management of FreeSeas' vessels is performed by Free Bulkers S.A., a Marshall Islands company that is controlled by Ion G. Varouxakis, the Company's Chairman, President and CEO, and one of the Company's principal shareholders. The Company's fleet consists of six Handysize vessels and one Handymax vessel that carry a variety of drybulk commodities, including iron ore, grain and coal, which are referred to as "major bulks," as well as bauxite, phosphate, fertilizers, steel products, cement, sugar and rice, or "minor bulks." As of Oct. 12, 2012, the aggregate dwt of the Company's operational fleet is approximately 197,200 dwt and the average age of its fleet is 15 years. Freeseas disclosed a net loss of US$30.88 million in 2012, a net loss of US$88.19 million in 2011, and a net loss of US$21.82 million in 2010. The Company's balance sheet at Dec. 31, 2012, showed US$114.35 million in total assets, $106.55 million in total liabilities and US$7.80 million in total shareholders' equity. RBSM LLP, in New York, 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 incurred recurring operating losses and has a working capital deficiency. In addition, the Company has failed to meet scheduled payment obligations under its loan facilities and has not complied with certain covenants included in its loan agreements. It has also failed to make required payments to Deutsche Bank Nederland as agreed to in its Sept. 7, 2012, amended and restated facility agreement and received notices of default from First Business Bank. Furthermore, the vast majority of the Company's assets are considered to be highly illiquid and if the Company were forced to liquidate, the amount realized by the Company could be substantially lower that the carrying value of these assets. These conditions, among others, raise substantial doubt about the Company's ability to continue as a going concern. GATEHOUSE MEDIA: Incurs $14.1 Million Net Loss in Second Quarter ---------------------------------------------------------------- Gatehouse Media, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $14.12 million on $119.59 million of total revenues for the three months ended June 30, 2013, as compared with a net loss of $2.69 million on $125.97 million of total revenues for the three months ended July 1, 2012. For the six months ended June 30, 2013, the Company incurred a net loss of $31.63 million on $230.17 million of total revenues, as compared with a net loss of $15.93 million on $243.18 million of total revenues for the six months ended July 1, 2012. For the 12 months ended Dec. 30, 2012, the Company incurred a net loss of $30.33 million, as compared with a net loss of $22.22 million for the 12 months ended Jan. 1, 2012. As of June 30, 2013, the Company had $433.70 million in total assets, $1.28 billion in total liabilities and a $848.85 million total stockholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/Stbeme About GateHouse Media GateHouse Media, Inc. -- http://www.gatehousemedia.com/-- headquartered in Fairport, New York, is one of the largest publishers of locally based print and online media in the United States as measured by its 97 daily publications. GateHouse Media currently serves local audiences of more than 10 million per week across 21 states through hundreds of community publications and local Web sites. Bankruptcy Warning "Our ability to make payments on our indebtedness as required depends on our ability to generate cash flow from operations in the future. This ability, to a certain extent, is subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control. "There can be no assurance that our business will generate cash flow from operations or that future borrowings will be available to us in amounts sufficient to enable us to pay our indebtedness or to fund our other liquidity needs. Currently we do not have the ability to draw upon our revolving credit facility which limits our immediate and short-term access to funds. If we are unable to repay our indebtedness at maturity we may be forced to liquidate or reorganize our operations and business under the federal bankruptcy laws," the Company said in its annual report for the year ended Dec. 30, 2012. GELT PROPERTIES: Hearing on Bucks County Bank Stay Relief Reset --------------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of Pennsylvania has rescheduled the hearing on the motion of Bucks County Bank for relief from the automatic stay, for adequate protection and to prohibit use of cash collateral in Gelt Properties, LLC, and Gelt Financial Corporation's Chapter 11 cases, to 1:00 p.m. on Aug. 14, 2013. The Bankruptcy Court also rescheduled the hearing on the objection filed by Bucks County Bank to the Debtors' motion to use cash collateral to 1:00 p.m. on Aug. 14, 2013. As reported in the TCR on March 27, 2012, Bucks County Bank asked the Bankruptcy Court to terminate the automatic stay under Section 362 of the Bankruptcy Code. Robert A. Badman, Esq. at Curtin & Heefner LLP, in Morrisville, Pennsylvania, attorney for the Bank, asserted that the Disclosure Statement and the Plan of Reorganization understate the claim of the Bank by listing only the principal amount due and owing the Bank and failing to include the accrued interest and late charges. "The Plan is not confirmable in that Debtor proposes interest payments to the Bank and other secured creditors, without the consent of Bank and those other creditors, in amounts significantly below the amounts required under the Bankruptcy Code, and Debtor's income is insufficient to fund a plan with payments based on acceptable rates of interest," Mr. Badman told the Court. As reported in the TCR on April 18, 2012, Bucks County Bank objected to the Debtors' continued use of cash collateral. According to the Bank, among other things: -- the Debtors proposed reduced monthly adequate protection payments are substantially less than the amount agreed by the Bank and the amount necessary to protect the interests of the Bank in the collateral securing the Bank Claims; -- the Debtors have also not complied with their obligation to provide monthly reporting to the Bank concerning receipts and disbursements relating to said Bank's loans or collateral; -- the Debtors continue to receive payments on account of the collateral securing the Bank Claims in amounts exceeding the amounts proposed to be paid to the Bank. -- each payment received by the Debtors and not remitted to the Bank results in a diminution of the value of the collateral securing the Bank Claims. About Gelt Properties Based in Huntington Valley, Pennsylvania, Gelt Properties, LLC, and affiliate Gelt Financial Corporation borrow money from traditional lenders and make loans to commercial borrowers. They also acquire and manage real estate. Gelt Properties and Gelt Financial filed for (Bankr. E.D. Pa. Case Nos. 11-15826 and 11- 15826) on July 25, 2011. Judge Magdeline D. Coleman presides over the cases. William John Baldini, Esq., Albert A. Ciardi, III, Esq., Jennifer E. Cranston, Esq., and Daniel S. Siedman, Esq., at Ciardi Ciardi & Astin, in Philadelphia, Pa.; Thomas Daniel Bielli, Esq., at O'Kelly Ernst & Bielli, LLC, in Philadelphia, Pa.; Janet L. Gold, Esq., at Eisenberg, Gold & Cettei, P.C., in Cherry Hill, N.J.; David A. Huber, Esq., at Benjamin Legal Services, in Philadelphia, Pa.; Alan L. Nochumson, Esq., at Nochumson PC, in Philadelphia, Pa.; Axel A. Shield, II, Esq., of Huntington Valley, Pa., serve as counsel for Debtor Gelt Properties, LLC. Attorneys Bielli, Ciardi, III, Cranston, Huber, Nochumson, Shield, II, and Siedman, represent Debtor Gelt Financial Corporation as counsel. Gelt Properties disclosed $4.73 million in assets and $4.84 million in liabilities as of the Chapter 11 filing. Its affiliate, Gelt Financial has scheduled $20.3 million in assets and $17.05 million in liabilities as of the Chapter 11 filing. Paul J. Schoff, Esq., and Francis X. Gorman, Esq., at Schoff McCabe, P.C., represent the Unsecured Creditors' Committee. Craig Howe, CPA, and Howe, Keller & Hunter, P.C., serve as the Committee's accountants. GELTECH SOLUTIONS: Grants 250,000 Options to Executives ------------------------------------------------------- The Compensation Committee of GelTech Solutions, Inc., granted Michael Cordani, the Company's chief executive officer, Peter Cordani, the Company's chief technology officer and Michael Hull, the Company's chief financial officer, 250,000 10-year stock options exercisable at $1.30 per share. Of the options: (i) 125,000 options vest upon the market price of the Company's common stock trading at or greater than an average price of $2.00 per share for any 10 days out of a 30-trading-day period, and (ii) 125,000 options vest upon the market price of the Company's common stock trading at or greater than an average price of $3.00 per share for 10 days out of a 30 day period. About GelTech Jupiter, Fla.-based GelTech Solutions. Inc., is a Delaware corporation organized in 2006. The Company markets four products: (1) FireIce(R), a water soluble fire retardant used to protect firefighters, structures and wildlands; (2) Soil2O(R) 'Dust Control', its new application which is used for dust mitigation in the aggregate, road construction, mining, as well as, other industries that deal with daily dust control issues; (3) Soil2O(R), a product which reduces the use of water and is primarily marketed to golf courses, commercial landscapers and the agriculture market; and (4) FireIce(R) Home Defense Unit, a system for applying FireIce(R) to structures to protect them from wildfires. "As of December 31, 2012, the Company had a working capital deficit, an accumulated deficit and stockholders' deficit of $1,339,923, $26,011,370 and $2,655,057, respectively, and incurred losses from operations of $3,211,484 for the six months ended December 31, 2012 and used cash from operations of $1,994,491 during the six months ended December 31, 2012. In addition, the Company has not yet generated revenue sufficient to support ongoing operations. These factors raise substantial doubt regarding the Company's ability to continue as a going concern." For the nine months ended March 31, 2013, the Company incurred a net loss of $4.06 million on $206,880 of sales, as compared with a net loss of $4.04 million on $304,361 of sales for the same period a year ago. The Company's balance sheet at March 31, 2013, showed $1.47 million in total assets, $3.31 million in total liabilities and a $1.83 million total stockholders' deficit. GH BROADCASTING: Sec. 341 Creditors' Meeting Set for Aug. 30 ------------------------------------------------------------ The U.S. Trustee will convene a meeting of creditors pursuant to 11 U.S.C. 341(a) in the involuntary Chapter 11 case of GH Broadcasting, LLC on Aug. 30, 2013, at 10:30 a.m. The meeting will be held at Corpus Christi, 606 Carancahua. On July 2, 2013, an involuntary petition for relief (Bankr. S.D. Tex. Case No. 13-20308) was filed against GH Broadcasting, LLC by Robert Behar, Estrella Behar, Pan Atlantic Bank & Trust, Ltd., Latin Capital Ventures, LLC, Joseph Kavana, Leibowitz Family Broadcasting, LLC Guaranty, Morris Bailey, Jays Four, LLC, Jesselson Grandchildren, Sawicki Family Ltd. Partnership, Saby Behar Rev Trust, Benjamin J. Jesselson, Sumit Enterprises, LLC, Pedro Dupouy, Shpilberg Mgmt Associates, LLC, Leon Perez, Jose Rodriguez pursuant to section 303 of the Bankruptcy Code. GLYECO INC: Stockholders Elect Five Directors --------------------------------------------- GlyEco, Inc., held its 2013 annual meeting of stockholders on July 29, 2013, at which the stockholders: (1) elected John Lorenz, Michael Jaap, Joseph Ioia, Rick Opler, and Keri Smith as directors of the Company to serve for a one-year term or until their successors have been elected and qualified; (2) ratified the appointment of Semple, Marchal & Cooper, LLP, as the Company's independent registered public accounting firm for the fiscal year ending Dec. 31, 2013; (3) approved, on an advisory basis, the compensation of the Company's named executive officers; and (4) indicated, on an advisory basis, a preferred frequency of three years for holding an advisory vote on the compensation of the Company's named executive officers. About GlyEco, Inc. Phoenix, Ariz.-based GlyEco, Inc., is a green chemistry company formed to roll-out its proprietary and patent pending glycol recycling technology that transforms waste glycols, a hazardous material, into profitable green products. Glyeco disclosed a net loss of $1.86 million on $1.26 million of net sales for the year ended Dec. 31, 2012, as compared with a net loss of $592,171 on $824,289 of net sales for the year ended Dec. 31, 2011. The Company's balance sheet at March 31, 2013, showed $9.16 million in total assets, $2.63 million in total liabilities and $6.53 million in total stockholders' equity. Jorgensen & Co., in Lehi, UT, 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 not yet achieved profitable operations and is dependent on its ability to raise capital from stockholders or other sources and other factors to sustain operations. These factors, among other matters, raise substantial doubt that the Company will be able to continue as a going concern. GRAYMARK HEALTHCARE: Foundation Owns 70.2% Equity Stake ------------------------------------------------------- In a Schedule 13D filing with the U.S. Securities and Exchange Commission, Foundation Healthcare Affiliates, LLC, disclosed that as of July 22, 2013, it beneficially owned 114,500,000 shares of common stock of Graymark Healthcare, Inc., representing 70.2 percent of the shares outstanding based upon 163,203,276 shares of the Company's common stock outstanding as of July 22, 2013. Foundation Healthcare acquired the securities in connection with the consummation on July 22, 2013, of the acquisition by the Graymark through its wholly owned subsidiary, TSH Acquisition, LLC, from Foundation Healthcare of all of the membership interests of the Companies pursuant to the terms and conditions of the Amended and Restated Membership Interest Purchase Agreement, dated as of March 29, 2013. Prior to the completion of the acquisition, Foundation Healthcare held all of the equity interests of the Companies. Pursuant to the terms of the Amended Purchase Agreement and effective upon the completion of the acquisition, Foundation Healthcare acquired beneficial ownership of the shares, and Graymark assumed certain liabilities and obligations of Foundation Healthcare. A copy of the regulatory filing is available for free at: http://is.gd/IFXvCn About Graymark Healthcare Graymark Healthcare, Inc., headquartered in Oklahoma City, Okla., provides care management solutions to the sleep disorder market. As of June 30, 2012, the Company operated 107 sleep diagnostic and therapy centers in 10 states. The Company's balance sheet at March 31, 2013, showed $5.70 million in total assets, $25.51 million in total liabilities and a $19.81 million total deficit. Going Concern As of March 31, 2013, the Company had an accumulated deficit of $60.2 million and reported a net loss of $2.7 million for the first quarter of 2013. In addition, the Company used $0.3 million in cash from operating activities from continuing operations during the quarter. On March 29, 2013, the Company signed a definitive purchase agreement with Foundation Healthcare Affiliates, LLC to purchase 100 percent of the interests in Foundation Surgery Affiliates, LLC and Foundation Surgical Hospital Affiliates, LLC, in exchange for 98.5 million shares of the Company's common stock. Management expects the transaction to close in the second quarter of 2013; however, there is no assurance the acquisition will close at that time or at all. "If the Company is unable to close the Foundation transaction or raise additional funds, the Company may be forced to substantially scale back operations or entirely cease its operations and discontinue its business. These uncertainties raise substantial doubt regarding the Company's ability to continue as a going concern," according to the Company's quarterly report for the period ended March 31, 2013. GRYPHON GOLD: Chapter 11 Petition Filed --------------------------------------- Gryphon Gold filed for Chapter 11 protection (Bankr. D. Nev. Case No. 13-51496). BankruptcyData reported that the Company, which engages in the acquisition, exploration and development of gold properties primarily in Nevada, is represented by Stephen R. Harris of Harris Law Practice. The Company announced that it initiated this filing "in an effort to address certain operational and liquidity challenges," the report related. Gryphon Gold also announced that, on July 22, 2013, it was served with a civil complaint to appoint a receiver. The complaint was filed in the Second Judicial District Court for the State of Nevada by certain shareholders. Gryphon Gold Corporation, headquartered in Carson City, Nevada, holds a 40% joint venture interest in the gold producing Borealis Property through its 40% ownership of Borealis Mining Company LLC, which is located in Nevada's Walker Lane Gold Belt. HANDY HARDWARE: Littlejohn & Co. Completes Acquisition ------------------------------------------------------ Littlejohn & Co., LLC, on Aug. 5 disclosed that it has completed the acquisition and recapitalization of Handy Hardware, a leading wholesale hardware distributor to independent hardware retailers. Handy Hardware emerged from Chapter 11 after the U.S. Bankruptcy court in Wilmington, DE approved the transaction on July 25. Based in Houston and founded nearly 60 years ago, Handy Hardware provides a broad offering of nearly 50,000 items. These name brand products are distributed to over 1,000 customers in such categories as plumbing, electrical, general hardware, paint, hand and power tools, lawn and garden care, automotive, and office supplies. The company distributes its products to retail hardware stores in nine states located primarily in the southern U.S. About Littlejohn & Co., LLC Littlejohn & Co. -- http://www.littlejohnllc.com-- is a Greenwich, Connecticut-based private equity and distressed securities firm investing in middle-market companies that are undergoing a fundamental change in capital structure, strategy, operations or growth that can benefit from its operational and strategic approach. The firm is currently investing from Littlejohn Fund IV, L.P., which has over $1.3 billion in capital commitments. 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. William P. Bowden 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. HERCULES OFFSHORE: Had $27.4-Mil. Net Loss in Second Quarter ------------------------------------------------------------ Hercules Offshore, Inc., reported a net loss of $27.37 million on $211.45 million of revenue for the three months ended June 30, 2013, as compared with a net loss of $55.07 million on $154.49 million of revenue for the same period during the prior year. For the six months ended June 30, 2013, the Company posted net income of $7.78 million on $397.65 million of revenue, as compared with a net loss of $93.41 million on $283.05 million of revenue for the same period a year ago. Hercules incurred a net loss of $127 million in 2012, a net loss of $76.12 million in 2011, and a net loss of $134.59 million in 2010. As of June 30, 2013, the Company had $2.15 billion in total assets, $1.23 billion in total liabilities and $917.27 million in total equity. John T. Rynd, chief executive officer and president of Hercules Offshore stated, "Over the past few months, we have taken significant steps to transform the Company to a more focused provider of offshore drilling and international liftboat services, culminating in our acquisition of Discovery Offshore. This acquisition represents a major step forward in our fleet renewal efforts, and adds two world-class jackup rigs with market leading capabilities. Demand for rigs of this caliber is increasing, and we are actively seeking attractive contract opportunities in various international regions. At the same time we high-graded our drilling fleet with Discovery, we also divested of lower performing assets through the sale of our Domestic Liftboats and Inland segments. Given these strategic moves, we expect to be a more geographically diverse company, operating in regions that have attractive long term growth fundamentals." A copy of the press release is available for free at: http://is.gd/EEHbV0 A copy of the Form 10-Q is available for free at: http://is.gd/GHoe9R About Hercules Offshore Hercules Offshore Inc. (NASDAQ: HERO) -- http://www.herculesoffshore.com/-- provides shallow-water drilling and marine services to the oil and natural gas exploration and production industry in the United States, Gulf of Mexico and internationally. The Company provides these services to integrated energy companies, independent oil and natural gas operators and national oil companies. The Company operates in six business segments: Domestic Offshore, International Offshore, Inland, Domestic Liftboats, International Liftboats and Delta Towing. * * * The Troubled Company Reporter said on April 11, 2013, that Moody's Investors Service upgraded Hercules Offshore, Inc.'s Corporate Family Rating to B2 from B3. Hercules' B2 CFR is supported by its improved cash flow and lower leverage on the back of increased drilling activity and higher day-rates in the Gulf of Mexico (GOM) As reported by the TCR on Nov. 6, 2012, Standard & Poor's Ratings Services raised its corporate credit rating on Houston-based Hercules Offshore Inc. to 'B' from 'B-'. "The upgrade reflects the improving market conditions in the Gulf of Mexico and our expectations that Hercules' fleet will continue to benefit," said Standard & Poor's credit analyst Stephen Scovotti. HERON LAKE: Granite Falls Acquires Majority Interest ---------------------------------------------------- Granite Falls Energy has acquired a majority interest in Heron Lake BioEnergy. Pursuant to this new strategic partnership, Granite Falls Energy will provide management services to Heron Lake BioEnergy and appoint a majority of the members of its board of governors. The Heron Lake BioEnergy plant, located near Heron Lake, Minnesota, has an annual production capacity of 58 million gallons and sells livestock feed and corn oil as co-products of fuel ethanol production. "Granite Falls Energy is pleased with the opportunity to invest in an excellent company like Heron Lake BioEnergy and to lend our management team to the mutual effort," said Paul Enstad, chairman of the Granite Falls Energy board. "This combination with another great rural Minnesota ethanol producer fits well within our vision for Granite Falls Energy." "Heron Lake BioEnergy welcomes our friends from Granite Falls," said David Woestehoff, a founding governor of Heron Lake BioEnergy. "This is a great opportunity for both companies. We look forward to moving this company forward and believe this arrangement will provide the best return to our shareholders." About Heron Lake Heron Lake BioEnergy, LLC, operated a dry mill, coal fired ethanol plant in Heron Lake, Minnesota. After completing a conversion in November 2011, the Company is now a natural gas fired ethanol plant. Its subsidiary, HLBE Pipeline Company, LLC, owns 73 percent of Agrinatural Gas, LLC, the pipeline company formed to construct, own, and operate a natural gas pipeline that provides natural gas to the Company's ethanol production facility through a connection with the natural gas pipeline facilities of Northern Border Pipeline Company in Cottonwood County, Minnesota. Its subsidiary, Lakefield Farmers Elevator, LLC, has grain facilities at Lakefield and Wilder, Minnesota. At nameplate, the Company's ethanol plant has the capacity to process approximately 18.0 million bushels of corn each year, producing approximately 50 million gallons per year of fuel-grade ethanol and approximately 160,000 tons of distillers' grains with soluble. In its report on the Company's financial statements for the fiscal year ended Oct. 31, 2012, Boulay, Heutmaker, Zibell & Co. P.L.L.P., in Minneapolis, Minnesota, expressed substantial doubt about Heron Lake BioEnergy's ability to continue as a going concern. The independent auditors noted that the Company has incurred losses due to difficult market conditions and the impairment of long-lived assets. "The Company is out of compliance with its master loan agreement and is operating under a forbearance agreement whereby the Company agreed to sell substantially all of its assets." The Company reported a net loss of $32.35 million for the year ended Oct. 31, 2012, as compared with net income of $543,017 for the year ended Oct. 31, 2011. As of April 30, 2013, the Company had $59.78 million in total assets, $44.05 million in total liabilities and $15.72 million in total members' equity. Bankruptcy Warning At Jan. 31, 2013, the Company's total indebtedness to AgStar was approximately $41.1 million. All of the Company's assets and real property are subject to security interests and mortgages in favor of AgStar as security for the obligations of the master loan agreement. The Company's failure to pay any required installment of principal or interest or any other amounts payable under the Company's Term Loan or Term Revolving Loan or the Company's failure to perform or observe any covenant under the Sixth Amended and Restated Master Loan Agreement would result in an event of default, entitling AgStar to accelerate and declare due all amounts outstanding under the Company's Term Loan and its Term Revolving Loan. "Upon the occurrence of any one or more Events of Default, as defined under the Sixth Amended and Restated Forbearance Agreement, including failure to observe any of the financial or affirmative covenants..., AgStar may accelerate all of our indebtedness and may seize the assets that secure our indebtedness, causing us to lose control of our business. We may also be forced to sell our assets, restructure our indebtedness, submit to foreclosure proceedings, cease operations or seek bankruptcy or reorganization protection." HERTZ CORP: DBRS Assigns 'BB' Issuer Rating ------------------------------------------- DBRS, Inc. has commented on the 2Q13 financial results of Hertz Corporation. DBRS rates the Company's Issuer Rating at BB. The trend on the ratings is Negative, where they were placed on August 28, 2012. The Negative trend reflects the substantial integration risks and other near-term risks associated with the Company's acquisition of Dollar Thrifty Automotive Group, Inc. (DTAG or Dollar Thrifty), which closed on November 19, 2012. Hertz reported record second quarter GAAP pre-tax income of $211.9 million. On an adjusted basis, excluding such items as restructuring charges, non-cash debt charges and acquisition related costs, Hertz reported record pre-tax income of $314.5 million, a 34% improvement YoY. Results for the quarter reflect record revenue generation driven by the addition of Dollar Thrifty along with sound volume growth and overall improved pricing in both worldwide rental car and worldwide equipment rental. Moreover, earnings expansion was supported by solid cost control. For the quarter, Hertz reported second quarter revenues of $2.7 billion, a 22% increase YoY. Revenue growth was underpinned by record revenues in worldwide rental car and revenue expansion at Hertz Equipment Rental Corporation (HERC) that is outpacing industry growth forecasts. Worldwide rental car revenue increased 23% YoY to $2.3 billion underpinned by the addition of Dollar Thrifty, strong volume growth and an improving pricing environment. Meanwhile, revenue generation in the equipment rental business continues to expand reflecting a strong performance in the North America business, which accounts for 93% of the segments revenues. For the quarter, HERC revenues improved 14.7% YoY to $384.3 million. In DBRS's view the improving performance of HERC reflects the realization of the benefits of recent bolt-on acquisitions that have broadened the segment's operations into new markets and positioned the business to capitalize on solid opportunities for growth. Operating expenses were higher in the quarter compared to a year ago primarily reflecting the impact of the DTAG acquisition. However, operating efficiency improved with direct operating expenses and SG&A expenses totaled 61.9% of revenues, an 80 basis point (bps) improvement YoY. The improvement in operating efficiency reflects continued cost reduction initiatives, improved employee productivity and integration synergies that are currently ahead of plan. U.S. fleet costs were modestly higher YoY reflecting softening in wholesale auction values in April and May. As a result, U.S. vehicle depreciation, excluding Donlen, was 2% higher at $218 per month per unit. DBRS notes that residual values have stabilized since May 2013 and that the Company continues to shift more of its fleet sales to higher-return retail channels. Moreover, Hertz expects the average per unit cost of its 2014 fleet buy to be below that of the 2013 fleet buy, which will benefit fleet costs in the latter parts of 2013 and into 2014. As a result, DBRS expects fleet costs to remain well-controlled. By operating segment, Worldwide Car Rental's adjusted pre-tax income was $363.0 million compared to $277.4 million a year ago. The record results were underpinned by another strong performance in U.S. Rental Car which reported revenue growth of 34% YoY and improved operating efficiency partially offset by the aforementioned higher fleet costs. Revenue growth was supported by the inclusion of Dollar Thrifty, a 12% expansion in off-airport revenue on higher volumes and improved pricing, and pricing gains in the on-airport segment. Importantly, after two years of pressured operating results, Hertz's European operations, excluding Switzerland, reported solid revenue growth of 4%, excluding foreign currency movements. The improvement in revenue generation reflects higher volumes and a slight increase in inbound revenue. Also during the quarter, Hertz continued its expansion in Europe opening 137 co-branded Thrifty locations, 5 additional Firefly (the Company's deep-value brand, formerly Advantage Europe) locations and the acquisition of CCL Vehicles Rentals to penetrate the U.K.'s $1.5 billion insurance replacement market. DBRS sees these actions by Hertz as positioning the Company to capitalize on growth opportunities when the European economy returns to a growth trajectory. HERC's financial performance continues to strengthen. For 2Q13, the segment generated adjusted pre-tax income of $74.1 million, a notable 74% increase YoY. As noted above, revenue growth was sound while costs remain well-managed. As a result, adjusted pre-tax margin improved to 19.3%. From DBRS's perspective, Hertz's funding and liquidity profile remain solid and well-managed. The Company continues to proactively take advantage of the favorable rate environment to lower financing costs which will benefit margins and earnings in upcoming quarters. To this end, during 2Q13, Hertz completed the repricing of its senior secured tranche B term loan facility with lower margins and a reduced interest rate floor. DBRS notes at the time of the repricing the Company had $1.4 billion of outstanding borrowings under the facility. Liquidity profile was solid with $840 million of available corporate liquidity at quarter-end. HEXCEL CORP: Debt Repayment Prompts Moody's to Withdraw Ratings --------------------------------------------------------------- Moody's Investors Service has withdrawn all ratings of Hexcel Corporation, including its Ba1 Corporate Family Rating, following its refinancing of its existing credit facility and repayment of all rated debt facilities with proceeds from a new, unrated $600 million revolver in June 2013. The following ratings have been withdrawn: Corporate Family Rating at Ba1 Probability of Default Rating at Ba1-PD Speculative Liquidity Rating at SGL-3 $360 million senior secured revolving credit at Ba1 (LGD 3, 38%) $90 million senior secured term loan at Ba1 (LGD3, 38%) Ratings Rationale: Hexcel, headquartered in Stamford, CT, is a leading advanced composites company. It develops, manufactures and markets lightweight, high performance structural materials, including carbon fibers, reinforcements for composites, prepregs, honeycomb, matrix systems, adhesives and composite structures used in commercial aerospace, space and defense, and industrial applications. LTM revenue through June 2013 was approximately $1.6 billion. HIGH MAINTENANCE: Sec. 341 Creditors' Meeting Set for Aug. 30 ------------------------------------------------------------- The U.S. Trustee will convene a meeting of creditors pursuant to 11 U.S.C. 341(a) in the Chapter 11 case of High Maintenance Broadcasting, LLC on Aug. 30, 2013, at 10:30 a.m. The meeting will be held Corpus Christi, 606 Carancahua. Proofs of claim are due by Nov. 28, 2013. On June 17, 2013, an involuntary petition for relief (Bankr. S.D. Tex. Case No. 13-20270) was filed against High Maintenance Broadcasting, LLC by Robert Behar, Estrella Behar, Leibowitz Family, Pedro Dupouy, Latin Capital, Pan Atlantic Bank & Trust, Ltd., Sumit Enterprises, LLC, Jose Rodriguez, Leon Perez, Jays Four, LLC, Benjamin J. Jesselson, Jesselson Grandchildren, Joseph Kavana, Sawicki Family, Shpilberg Mgmt, Saby Behar Rev, Morris Bailey pursuant to section 303 of the Bankruptcy Code. IEMR RESOURCES: Gets Notice Default From American Cumo ------------------------------------------------------ IEMR Resources Inc. on Aug. 2 disclosed that it received a notice of default dated July 31, 2013 from American Cumo Mining Corporation in respect of a US$200,000 cash option payment that was due for payment to American Cumo under the option agreement between the Company, American Cumo and Mosquito Mining Corp. (US) dated January 26, 2010, amended April 6, 2010 and May 31, 2010, pursuant to which the Company is to earn a 100% interest in the Pine Tree Property in Nevada. The Company also disclosed that it made such US$200,000 cash option payment in full on Aug. 2 to American Cumo from the proceeds of a loan of the principal sum of $250,000 from International Energy and Mineral Resources Investment (Hong Kong) Company Limited to the Company having a term of three years. The Loan is unsecured and no interest is payable on the outstanding Principal. The Lender is a "Related Party" of the Company pursuant to the TSX Venture Exchange policies as Mr. Hongxue Fu, President, Chief Executive Officer and director of the Company, holds a controlling interest in the Lender. As such, the Loan constitutes a "Related Party Transaction" under the TSXV policies. The Company is relying on the exemption under section 5.5(b) of Multilateral Instrument 61-101 - Protection Of Minority Security Holders In Special Transaction ("MI 61 101") from obtaining a formal valuation as the Company is listed on the TSXV and no securities of the Company are listed or quoted on any of the markets specified in said section. The Company is also relying on the exemption under section 5.7(f) of MI 61-101 from the minority approval requirement as the transaction was a loan that was obtained by the Company from a related party on reasonable commercial terms that are not less advantageous to the Company than if the Loan were obtained from a person dealing at arm's length with the Company, and the Loan is not: (A) convertible, directly or indirectly, into equity or voting securities of the Company or a subsidiary entity of the Company, or otherwise participating in nature; or (B) repayable, directly or indirectly, in equity or voting securities of the Company or a subsidiary entity of the Company. About IEMR Resources Inc. IEMR -- http://www.iemr.ca-- is a junior mining company listed on the TSXV under the symbol "IRI". The Company is directly tied to and has been formed from capital sources in China and Canada. IEMR is devoted to taking full advantage of its capital by participating in mineral and energy projects ranging from exploration, development, production, processing, smeltering and mineral trade with a long-term view. The Company's emphasis is on the Chinese and Canadian markets utilizing the capital stemming from China and the resources and market of Canada to create a maximum return for shareholders. The Company's investment priorities ranked in order are copper, chromium, nickel, manganese, uranium, platinum silver, diamonds and molybdenum. Investment and or acquisitions in exploration projects will be focused in chromium, manganese, uranium and potash. The Company has already formed alliances of cooperation with large smeltering steel, copper, lead, zinc and aluminum companies. INFUSYSTEM HOLDINGS: Won't Pursue Potential Sale to Meson --------------------------------------------------------- The Board of Directors of InfuSystem Holdings, Inc., issued an open letter to all shareholders noting its Special Committee had decided that it is in the best interest of all shareholders to terminate the consideration of a potential sale of the Company, and the Board unanimously consented to the disbanding of the Special Committee. Following thorough discussions with the Special Committee through the Company's investment banking advisors, Ryan Morris and his potential financing partners have decided not to accept the offer made by the Special Committee in its letter dated July 18, 2013. In that letter, the Special Committee was willing to agree to a reasonable period of exclusivity for due diligence and dialogue in order to better understand and address concerns regarding future risks to the Company as well as to assist Mr. Morris and his financing sources to potentially increase the value of their proposal. Ryan Morris, a member the Board of the Company, previously delivered a letter to the Special Committee regarding the indication of interest by Meson Capital and himself to acquire InfuSystem Holdings for between $1.85 and $2.00 per share in cash. "While the Special Committee appreciates Mr. Morris trying to increase shareholder value via a transaction, the Special Committee continues to believe that the value of the Company is above the proposed offer range of $1.85 to $ 2.00 per share in cash," the letter states. A copy of the letter is available for free at: http://is.gd/nsQZhb About InfuSystem Holdings InfuSystem Holdings, Inc., operates through operating subsidiaries, including InfuSystem, Inc., and First Biomedical, Inc. InfuSystem provides infusion pumps and related services. InfuSystem provides services to hospitals, oncology practices and facilities and other alternate site healthcare providers. Headquartered in Madison Heights, Michigan, InfuSystem delivers local, field-based customer support, and also operates pump service and repair Centers of Excellence in Michigan, Kansas, California, and Ontario, Canada. Infusystem Holdings disclosed a net loss of $1.48 million in 2012, as compared with a net loss of $45.44 million in 2011. The Company's balance sheet at March 31, 2013, showed $76.22 million in total assets, $35.70 million in total liabilities and $40.52 million in total stockholders' equity. INTELLICELL BIOSCIENCES: Issues 8 Million Shares to Hanover ----------------------------------------------------------- Intellicell Biosciences, Inc., issued and delivered to Hanover Holdings I, LLC, another 8,066,171 additional settlement shares pursuant to the terms of the settlement agreement approved by the Supreme Court of the State of New York, County of New York, on May 21, 2013. The Order approved, among other things, the settlement between Intellicell and Hanover in the matter entitled Hanover Holdings I, LLC v. Intellicell Biosciences, Inc., Case No. 651709/2013. Hanover commenced the Action against the Company on May 10, 2013, to recover an aggregate of $706,765 of past-due accounts payable of the Company, plus fees and costs. The Order provides for the full and final settlement of the Claim and the Action. The Settlement Agreement became effective and binding upon the Company and Hanover upon execution of the Order by the Court on May 21, 2013. On May 23, 2013, the Company issued and delivered to Hanover 8,500,000 shares of the Company's common stock, $0.001 par value. A copy of the Form 8-K is available for free at: http://is.gd/jM5VlX About Intellicell Biosciences Intellicell BioSciences, Inc., headquartered in New York, N.Y., was formed on Aug. 13, 2010, under the name "Regen Biosciences, Inc." as a pioneering regenerative medicine company to develop and commercialize regenerative medical technologies in large markets with unmet clinical needs. On Feb. 17, 2011, the company changed its name from "Regen Biosciences, Inc." to "IntelliCell BioSciences Inc". To date, IntelliCell has developed proprietary technologies that allow for the efficient and reproducible separation of stromal vascular fraction (branded "IntelliCell(TM)") containing adipose stem cells that can be performed in tissue processing centers and in doctors' offices. The Company has incurred losses since inception resulting in an accumulated deficit of $43,079,590 and a working capital deficit of $3,811,024 as of March 31, 2012, respectively. However, if the non-cash expense related to the Company's change in fair value of derivative liability and stock based compensation is excluded then the accumulated deficit amounted to $4,121,538. Further losses are anticipated in the continued development of its business, raising substantial doubt about the Company's ability to continue as a going concern. The Company's balance sheet at Sept. 30, 2012, showed $4.15 million in total assets, $7.31 million in total liabilities and a $3.16 million total stockholders' deficit. INTELLIPHARMACEUTICS INT'L: Closes Offering of $3.1-Mil. Units -------------------------------------------------------------- Intellipharmaceutics International Inc. has closed its previously announced underwritten public offering of 1,500,000 units of common shares and warrants at a price of US$2.05 per unit for gross proceeds of approximately US$3.1 million. The Company sold units comprised of an aggregate of 1,500,000 common shares and warrants to purchase an additional 375,000 common shares. The warrants are exercisable immediately, have a term of five years and an exercise price of US$2.55 per common share. After underwriting discounts and commissions and estimated offering expenses, the Company received net proceeds of approximately US$2,500,000. Maxim Group LLC acted as sole book-running manager for the offering. Brean Capital, LLC, acted as co-manager for the offering. The Company intends to use the net proceeds for expenses related to bioequivalence studies and clinical trials for the advancement of product development, and for working capital, research and development and general corporate purposes. About Intellipharmaceutics Toronto, Canada-based Intellipharmaceutics International Inc. is incorporated under the laws of Canada. Intellipharmaceutics is a pharmaceutical company specializing in the research, development and manufacture of novel and generic controlled-release and targeted-release oral solid dosage drugs. Its patented Hypermatrix(TM) technology is a multidimensional controlled- release drug delivery platform that can be applied to the efficient development of a wide range of existing and new pharmaceuticals. Based on this technology, Intellipharmaceutics has a pipeline of product candidates in various stages of development, including filings with the FDA in therapeutic areas that include neurology, cardiovascular, gastrointestinal tract, diabetes and pain. The Company's balance sheet at May 31, 2013, showed $3.6 million in total assets, $5.4 million in total liabilities, and a stockholders' deficiency of $1.8 million. Going Concern Uncertainty "In order for the Company to continue operations at existing levels, the Company expects that for at least the next twelve months the Company will require significant additional capital. While the Company expects to satisfy its operating cash requirements over the next twelve months from cash on hand, collection of anticipated revenues resulting from future commercialization activities, development agreements or marketing license agreements, through managing operating expense levels, funds from senior management through the convertible debenture described elsewhere herein, equity and/or debt financings, and/or new strategic partnership agreements funding some or all costs of development, there can be no assurance that the Company will be able to obtain any such capital on terms or in amounts sufficient to meet its needs or at all," the Company said in its quarterly report for the period ended May 31, 2013. INTELLIPHARMACEUTICS INT'L: Sabby Held 5% Equity Stake at July 26 ----------------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, Sabby Healthcare Volatility Master Fund, Ltd., and its affiliates disclosed that as of July 26, 2013, they beneficially owned 1,256,000 shares of common stock of Intellipharmaceutics International Inc. representing 5.92 percent of the shares outstanding. A copy of the regulatory filing is available for free at http://is.gd/LcwyWk About Intellipharmaceutics Toronto, Canada-based Intellipharmaceutics International Inc. is incorporated under the laws of Canada. Intellipharmaceutics is a pharmaceutical company specializing in the research, development and manufacture of novel and generic controlled-release and targeted-release oral solid dosage drugs. Its patented Hypermatrix(TM) technology is a multidimensional controlled- release drug delivery platform that can be applied to the efficient development of a wide range of existing and new pharmaceuticals. Based on this technology, Intellipharmaceutics has a pipeline of product candidates in various stages of development, including filings with the FDA in therapeutic areas that include neurology, cardiovascular, gastrointestinal tract, diabetes and pain. The Company's balance sheet at May 31, 2013, showed $3.6 million in total assets, $5.4 million in total liabilities, and a stockholders' deficiency of $1.8 million. Going Concern Uncertainty "In order for the Company to continue operations at existing levels, the Company expects that for at least the next twelve months the Company will require significant additional capital. While the Company expects to satisfy its operating cash requirements over the next twelve months from cash on hand, collection of anticipated revenues resulting from future commercialization activities, development agreements or marketing license agreements, through managing operating expense levels, funds from senior management through the convertible debenture described elsewhere herein, equity and/or debt financings, and/or new strategic partnership agreements funding some or all costs of development, there can be no assurance that the Company will be able to obtain any such capital on terms or in amounts sufficient to meet its needs or at all," the Company said in its quarterly report for the period ended May 31, 2013. ISAACSON STRUCTURAL: Can Hire Tamposi Law Group as Special Counsel ------------------------------------------------------------------ Isaacson Structural Steel, Inc. et al, sought and obtained approval from the U.S. Bankruptcy Court to employ Tamposi Law Group, P.C. as special counsel to review and prosecute the Debtors' chapter 5 claims in conjunction with William S. Gannon, PLLC. The Debtor will pay the firm $400 per hour for services rendered in the case. The Chapter 5 counsel's fees shall be limited by the amount collected in each case. The firm, will among other things, provide these services: a. advise and assist the Debtors with respect to all matters and proceedings arising in, under or related to the case; b. review and prosecute the case; and c. represent the Debtors at any hearing arising in, under or related to the case. About Isaacson Structural Steel Based in Berlin, New Hampshire, Isaacson Structural Steel, Inc., filed for Chapter 11 bankruptcy (Bankr. D. N.H. Case No. 11-12416) on June 22, 2011. Bankruptcy Judge J. Michael Deasy presides over the case. Isaacson Structural Steel estimated both assets and debts of $10 million to $50 million. The petition was signed by Arnold P. Hanson, Jr., president. An official committee of unsecured creditors has been appointed in Isaacson Structural Steel's case. Nixon Peabody LLP, and Mesirow Financial Consultants represents the Committee. A bankruptcy petition was also filed for Isaacson Steel, Inc. (Bankr. D. N.H. Case No. 11-12415) on June 22, 2011, estimating assets and debts of $1 million to $10 million. The petition was signed by Arnold P. Hanson, Jr., president. William S. Gannon, Esq., also represents Isaacson Steel. The cases are now being jointly administered. No trustee or examiner has been appointed in this case. J.C. PENNEY: Says News Report About CIT's Action is Untrue ---------------------------------------------------------- J. C. Penney Company, Inc., said that a news report which appeared on July 31, 2013, is untrue and that it has been told so directly by CIT, the subject of that report. Contrary to the news report, CIT continues to factor and support deliveries from JC Penney suppliers. In fact, JC Penney continues to have the support of all of its key vendors, who have maintained their shipments to the Company. The Company noted that CIT factored merchandise currently represents less than 4 percent of its overall inventory for the year. The Company further stated it continues to have ample liquidity to manage its business with expectations to close the quarter with approximately $1.5B in cash on its balance sheet. About J.C. Penney Plano, Texas-based J.C. Penney Company, Inc. is one of the U.S.'s largest department store operators with about 1,100 locations in the United States and Puerto Rico. J.C. Penney disclosed a net loss of $985 million in 2012, as compared with a net loss of $152 million in 2011. As of May 4, 2013, the Company had $10.37 billion in total assets, $7.50 billion in total liabilities and $2.86 billion in total stockholders' equity. * * * The Company carries Moody's Investors Service's B3 Corporate Family Rating with negative outlook. Early in March 2013, Standard & Poor's Ratings Services lowered its corporate credit rating on Penney to 'CCC+' from 'B-'. The outlook is negative. At the same time, S&P lowered the issue- level rating on the company's unsecured debt to 'CCC+' from 'B-' and maintained its '3' recovery rating on this debt, indicating S&P's expectation of meaningful (50% to 70%) recovery for debtholders in the event of a payment default. "The downgrade reflects the performance erosion that has accelerated throughout the previous year and seems likely to persist over the next 12 months," explained Standard & Poor's credit analyst David Kuntz. At the same time, Fitch Ratings downgraded the Company's Issuer Default Ratings to 'B-' from 'B'. The Rating Outlook is Negative. The rating downgrades reflect Fitch's concerns that there is a lack of visibility in terms of the Company's ability to stabilize its business in 2013 and beyond after a precipitous decline in revenues leading to negative EBITDA of $270 million in 2012. Penney, Fitch said, will need to tap into additional funding to cover a projected FCF shortfall of $1.3 billion to $1.5 billion in 2013, which could begin to strain its existing sources of liquidity. In February 2013, Penney received a notice of default from a law firm representing more than 50% of its 7.4% Debentures due 2037. The Company has filed a lawsuit in Delaware Chancery Court seeking to block efforts by the bondholder group to declare a default on the 2037 bonds. Penney also asked lawyers at Brown Rudnick LLP to identify the investors they represent. In March 2013, Penney received a letter from bondholders withdrawing and rescinding the Notice of Default. On April 12, 2013, Penney borrowed $850 million out of its $1.85 billion committed revolving credit facility with JPMorgan Chase Bank, N.A., as Administrative Agent, and Wells Fargo Bank, National Association, as LC Agent. Penney said the move was to enhance the Company's financial flexibility and position. JACKSONVILLE BANCORP: To Cancel Former CEO's Unexercised Option --------------------------------------------------------------- Jacksonville Bancorp, Inc., disclosed in a regulatory filing with the U.S. Securities and Exchange Commission that as a result of Stephen C. Green's resignation as president and chief executive officer on June 24, 2013, his option to purchase common stock of the Company will be cancelled unless it is exercised on or before Sept. 22, 2013, 90 days after Mr. Green's resignation. Under the executive employment agreement dated July 30, 2012, as amended on Dec. 31, 2012, and as a result of the closing of the Company's private placement in December 2012, Mr. Green was entitled to an option award for the purchase of 2 million shares of the Company's common stock. Under the employment agreement, the option award would have vested over a two-year period after the grant date. Effective June 24, 2013, Mr. Green was granted an option to purchase 2 million shares of the Company's common stock at a purchase price of $0.50 per share, which was fully vested upon the date of grant. Amends Rights Offering Jacksonville has amended its Form S-3 registration statement relating to the distribution, at no charge, to holders of the Company's common stock, par value $0.01 per share, nontransferable subscription rights to purchase shares of the Company's common stock up to an aggregate of 10 million shares. Each whole subscription right will entitle investors to purchase shares of common stock, at a subscription price of $0.50 per share. The subscription price is the same price, on an as- converted basis, at which the Company effected its December 2012 private placement of 50,000 shares of the Company's Series A Preferred Stock. The Company's common stock is listed on the Nasdaq Stock Market under the symbol "JAXB." On July 30, 2013, the last reported sale price of the Company's common stock on the Nasdaq Stock Market was $0.52 per share. A copy of the amended Form S-3 is available for free at: http://is.gd/y9slwb About Jacksonville Bancorp Jacksonville Bancorp, Inc., a bank holding company, is the parent of The Jacksonville Bank, a Florida state-chartered bank focusing on the Northeast Florida market with approximately $583 million in assets and eight full-service branches in Jacksonville, Duval County, Florida, as well as the Company's virtual branch. The Jacksonville Bank opened for business on May 28, 1999, and provides a variety of community banking services to businesses and individuals in Jacksonville, Florida. Jacksonville Bancorp disclosed a net loss of $43.04 million in 2012, a net loss of $24.05 million in 2011 and a $11.44 million net loss in 2010. The Company's balance sheet at March 31, 2013, showed $520.89 million in total assets, $487.47 million in total liabilities and $33.42 million in total shareholders' equity. "Both Bancorp and the Bank must meet regulatory capital requirements and maintain sufficient capital and liquidity and our regulators may modify and adjust such requirements in the future. The Bank's Board of Directors has agreed to a Memorandum of Understanding (the "2012 MoU") with the FDIC and the OFR for the Bank to maintain a total risk-based capital ratio of 12.00% and a Tier 1 leverage ratio of 8.00%. As of December 31, 2012, the Bank was well capitalized for regulatory purposes and met the capital requirements of the 2012 MoU. If noncompliance or other events cause the Bank to become subject to formal enforcement action, the FDIC could determine that the Bank is no longer "adequately capitalized" for regulatory purposes. Failure to remain adequately capitalized for regulatory purposes could affect customer confidence, our ability to grow, our costs of funds and FDIC insurance costs, our ability to make distributions on our trust preferred securities, and our business, results of operation, liquidity and financial condition, generally," according to the Company's annual report for the year ended Dec. 31, 2012. JHK INVESTMENTS: Cash Collateral Use Extended Until Aug. 20 ----------------------------------------------------------- Judge Alan H.W. Shiff of the U.S. Bankruptcy Court for the District of Connecticut, Bridgeport Division, authorized JHK Investment, LLC, to continue to use from July 17 through Aug. 20, 2013, cash collateral, which may be subject to the liens of Bay City Capital Fund V, L.P., and Bay City Capital Fund V Co. Investment Fund L.P. As adequate protection for Bay City's interests in the cash collateral, Bay City is granted replacement and/or substitute liens in all postpetition assets of JHK and their proceeds, excluding any bankruptcy avoidance causes of action, and those replacement liens will have the same validity, extent, and priority that Bay City possessed as to said liens on the Petition Date. The liens of Bay City and any replacement of those liens are subject to a carve-out of those liens for amounts payable by JHK for (i) fees of the U.S. Trustee, (ii) accrued and unpaid invoices for High Mountain Ranch for its employees solely for work performed on behalf of JHK and its subsidiaries in an amount not to exceed $2,500 in the aggregate, and (iii) the allowed reasonable fees of counsel for JHK in an amount not to exceed $50,000. A final hearing on the Debtor's request to use cash collateral has been scheduled for Aug. 20, 2013, at 10:00 a.m. The Debtor is represented by Craig I. Lifland, Esq., at Zeisler & Zeisler, P.C., in Bridgeport, Connecticut. Bay City is represented by Daniel Guyder, Esq. -- Daniel.guyder@allenovery.com -- and John Kibler, Esq. -- john.kibler@allenovery.com -- at Allen & Overy LLP, in New York, and Kathleen M. LaManna, Esq. -- klamanna@goodwin.com -- at Shipman & Goodwin LLP, in Hartford, Connecticut. About JHK Investments JHK Investments, LLC, filed a Chapter 11 petition (Bankr. D. Conn. Case No. 12-51608) in Bridgeport, Conn., on Aug. 29, estimating under $100 million in assets and more than $10 million in liabilities. Craig I. Lifland, Esq., at Zeisler & Zeisler, P.C., represents the Debtor. Westport, Connecticut-based JHK is an investment company founded by the former senior management team of United States Surgical Corporation. Founded by Leon C. Hirsch in 1963, USSC became a global medical device manufacturer with sales exceeding $1.2 billion and employing $4,000 Connecticut residents. The Debtor disclosed $38,690,639 in assets and $32,127,278 in liabilities as of the Chapter 11 filing. Following the success of USSC, Mr. Hirsch and two other senior USSC executives created JHK in order to produce and develop new markets and penetrate established markets throughout the world for high-tech medical devices. JHK owns equity in several start-up medical subsidiaries. The start-ups include Interventional Therapies, LLC, Auditory Licensing Company, LLC, Biowave Corporation, Gorham Enterprises, LLC, and American Bicycle Group, LLC. Bay City claims to be owed $31 million for funding provided to the Debtor since January 2011. The principals at JHK -- Mr. Hirsch, Turi Josefsen, and Robert A. Knarr -- guaranteed JHK's obligations, pledged the property in Wilton, Connecticut to secure obligations under the guaranty, and pledged all equity interests of JHK. In March 2012, Eleuthera, in its capacity as administrative agent for Bay City, declared an event of default as a result of the passage of the maturity date and the failure to pay the entire amount outstanding. On Aug. 28, 2012, Bay City and Eleuthera purported to exercise the pledge agreements insofar as they purported to register the Principals' interest in JHK in the name of Eleuthera, as nominee for Bay City, and purported to reserve their right to exercise voting rights in JHK. KIT DIGITAL: Wins Confirmation of Bankruptcy-Exit Plan ------------------------------------------------------ KIT digital, Inc. on Aug. 5 disclosed that its Plan of Reorganization will be confirmed by the U.S. Bankruptcy Court for the Southern District of New York. KIT digital filed for voluntary bankruptcy protection three months ago to cleanse itself of legacy issues, including financial, legal and regulatory matters. Upon emergence from Bankruptcy, the Company plans to rebrand as Piksel, and relaunch at September's International Broadcasting Convention in Amsterdam, one of the world's largest trade shows for the broadcast industry. "Piksel is set to emerge as a healthy, dynamic company with a great mix of talented employees, market-leading customers, profitable assets, and sufficient liquidity for operations and investments," said Peter Heiland, interim Chief Executive Officer of Piksel. "I would like to thank all of those who dedicated so much time and effort, including our employees and advisors, to helping us complete our restructuring." KIT digital will officially rebrand on August 29. Mr. Heiland notes that the new company will leverage its solutions expertise; the flexibility of which will be driven by a suite of software applications, industry partnerships, and world-class professional and managed services. "We have an incredibly talented global team at the cutting-edge of a rapidly evolving industry sector. Their insights and innovations, combined with a total 'design, build, manage' approach helps companies maximize their reach and return with video." Piksel's new leadership team remains in place and is focused on a number of new initiatives and opportunities that will create value for customers and shareholders. Under the approved Plan of Reorganization, existing shareholders of the Company are entitled to receive, among other things, one warrant per share of Company stock owned as of August 5, 2013. Holders of the warrants will have the right to purchase an equivalent number of shares of Piksel at $.205 per share. Because the warrants are not transferable, any Company stock purchased after August 5, 2013 will not be entitled to receive the warrants and will be cancelled on the Effective Date of the Plan of Reorganization. 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. The Official Committee of Equity Security Holders tapped to retain Brown Rudnick LLP, as lead bankruptcy counsel. The Official Committee of Unsecured Creditors tapped to retain Cathy Hershcopf, Esq., at Cooley LLP as its lead bankruptcy counsel, and Odyssey Capital Group as its financial advisor. LANDESK SOFTWARE: Moody's Keeps B2 CFR on Downsized Transactions ---------------------------------------------------------------- Moody's Investors Service said there was no impact on LANDesk's B2 corporate family rating or proposed senior secured facilities' B2 ratings based on the downsized transaction. LANDesk Software, headquartered in South Jordan, UT, is a provider of IT management tools and end point security solutions. LEMIC ENTERPRISE: A.M. Best Affirms 'C(weak)' FSR ------------------------------------------------- A.M. Best Co. has affirmed the financial strength rating of C (Weak) and issuer credit rating of "ccc" of LEMIC Insurance Company (LEMIC) (Baton Rouge, LA). The outlook for both ratings is negative. Concurrently, A.M. Best has withdrawn the ratings due to management's request to no longer participate in A.M. Best's interactive rating process. The ratings reflect LEMIC's unfavorable underwriting and operating performance driven by adverse loss reserve development in recent years, which culminated in a 44% decline in policyholder surplus as well as a significant deterioration in its risk-adjusted capitalization in 2012. LEVEL 3: Incurs $24 Million Net Loss in Second Quarter ------------------------------------------------------ Level 3 Communications, Inc., reported a net loss of $24 million on $1.56 billion of revenue for the three months ended June 30, 2013, as compared with a net loss of $62 million on $1.58 billion of revenue for the same period during the prior year. Level 3 incurred a net loss of $422 million in 2012, a net loss of $756 million in 2011, and a $622 net loss in 2010. As of June 30, 2013, the Company had $12.86 billion in total assets, $11.75 billion in total liabilities, and $1.11 billion in stockholders' equity. "Level 3 saw good growth in enterprise Core Network Services revenue this quarter across all three of our regions, and it continues to be the key driver for our business," said Jeff Storey, president and CEO of Level 3. "Demand remains healthy, and we had solid growth in Core Network Services sales this quarter." "We expect to be Free Cash Flow positive for the full year 2013, excluding payments related to our interest rate swap agreements, which are expected to be $45 million this year." A copy of the press release is available for free at: http://is.gd/kNyHbB About Level 3 Communications Headquartered in Broomfield, Colorado, Level 3 Communications, Inc., is a publicly traded international communications company with one of the world's largest communications and Internet backbones. * * * In October 2012, Fitch Ratings affirmed the 'B' Issuer Default Ratings (IDRs) assigned to Level 3. LVLT's ratings recognize, in part, the de-leveraging of the company's balance sheet resulting from its acquisition of Global Crossing Limited (GLBC). As reported by the TCR on June 5, 2013, Standard & Poor's Ratings Services raised its corporate credit rating on Broomfield, Colo.- based global telecommunications provider Level 3 Communications Inc. to 'B' from 'B-'. "The upgrade reflects improved debt leverage, initially from the acquisition of the lower-leveraged Global Crossing in October 2011, and subsequently from realization of the bulk of what the company expects to eventually be $300 million of annual operating synergies," said Standard & Poor's credit analyst Richard Siderman. LIFE CARE: U.S. Trustee Appoints 3 Members to Creditors Panel ------------------------------------------------------------- Guy G. Gebhardt, acting United States Trustee for Region 21, appointed three members to the official committee of unsecured creditors in the Chapter 11 case of Life Care St. Johns, Inc. The Creditors Committee members are: 1. Estate of Eliza S. Rigg c/o William K. Rigg, Personal Representative 4409 N. Alatamaha Street St. Augustine, FL 32092 Tel: (276) 393-9152 Fax: none Email: williamrigg@yahoo.com 2. Mary Taylor c/o James Taylor, Trustee 100 Park Dr. Cranford, NJ 07016 Tel: (908) 337-6832 Fax: none Email: jtay100@verizon.net 3. Frank and Tis Upchurch Attn: Kramer Upchurch 545 Carcaba Road St. Augustine, FL 32084 Tel: (904) 540-7387 Fax: none Email: kupchurch@southeastaero.com Life Care St. Johns, Inc., filed a Chapter 11 petition (Bankr. M.D. Fla. Case No. 13-04158) on July 3, 2013. Bruce Jones signed the petition as CEO. Judge Jerry A. Funk presides over the case. The Debtor estimated assets of at least $10 million and debts of at least $50 million. Stutsman Thames & Markey, P.A., serves as the Debtor's counsel. Navigant Capital Advisors, LLC, acts as the Debtor's financial advisor. American Legal Claim Services, LLC, serves as claims and noticing agent. LIFE CARE: Can Employ Stutsman Thames as Bankruptcy Counsel ----------------------------------------------------------- Life Care St. Johns, Inc., sought and obtained approval from the U.S. Bankruptcy Court to employ Stutsman Thames & Markey, P.A. as the Debtor's bankruptcy counsel. Life Care St. Johns, Inc., filed a Chapter 11 petition (Bankr. M.D. Fla. Case No. 13-04158) on July 3, 2013. Bruce Jones signed the petition as CEO. Judge Jerry A. Funk presides over the case. The Debtor estimated assets of at least $10 million and debts of at least $50 million. Stutsman Thames & Markey, P.A., serves as the Debtor's counsel. Navigant Capital Advisors, LLC, acts as the Debtor's financial advisor. American Legal Claim Services, LLC, serves as claims and noticing agent. LIFE CARE: Can Employ Navigant Capital as Financial Advisor ----------------------------------------------------------- Life Care St. Johns, Inc., sought and obtained approval from the U.S. Bankruptcy Court to employ Navigant Capital Advisors, LLC as financial advisor. The firm, among other things, will provide these services: a. Capital Restructuring Services; b. Operational Assessment; and c. Bankruptcy Administrative Support. The firm's rates are: Professional Rates ------------ ----- Senior Managing Directors $750 - 895/hr Managing Directors $695 - 825/hr Directors $550 - 695/hr Associate Directors $450 - 550/hr Managing Consultants $350 - 450/hr Consultants/Associates $245 - 350/hr Paraprofessionals $95 - 125/hr Life Care St. Johns, Inc., filed a Chapter 11 petition (Bankr. M.D. Fla. Case No. 13-04158) on July 3, 2013. Bruce Jones signed the petition as CEO. Judge Jerry A. Funk presides over the case. The Debtor estimated assets of at least $10 million and debts of at least $50 million. Stutsman Thames & Markey, P.A., serves as the Debtor's counsel. Navigant Capital Advisors, LLC, acts as the Debtor's financial advisor. American Legal Claim Services, LLC, serves as claims and noticing agent. MANTECH INT'L: Moody's Keeps Ba1 CFR Over Lower Earnings Guidance ----------------------------------------------------------------- Moody's has said that ManTech's updated 2013 earnings guidance of July 31st is credit negative but does not affect the Ba1 Corporate Family Rating. The guidance revision reflects lowered U.S. Army MRAP (Mine Resistant Ambush Protected) vehicle fleet maintenance requirements in Afghanistan and lower inventory stock requirements on route clearance vehicles. ManTech International Corporation is a technology service provider to the U.S. Department of Defense, intelligence community, Departments of Homeland Security, Justice & State departments and other civilian branches of the federal government. Principal services include systems engineering and integration, software, enterprise & security architecture, information assurance and processing, cyber security and logistical support. Revenues over the twelve months ended June 30, 2013 were $2.5 billion. MEI INC: Moody's Assigns 'B1' CFR; Outlook Positive --------------------------------------------------- Moody's Investors Service assigned a first-time B1 corporate family rating and B1-PD probability of default rating to MEI, Inc., a global manufacturer of unattended electronic payment systems. In a related action, Moody's assigned a B1 rating to the company's proposed first lien secured bank facility. Proceeds from the bank credit facility and some cash on hand will be used to refinance MEI's existing debt and to pay related fees and expenses. Also, about $57 million of mezzanine debt is being converted to equity, establishing a new and simplified capital structure. The rating outlook is positive. The following ratings will be affected by this action: Corporate Family Rating assigned B1; Probability of Default Rating assigned B1-PD; First Lien Sr. Sec. RCF due 2018 assigned B1 (LGD3, 46%); and, First Lien Sr. Sec. Term Loan due 2020 assigned B1 (LGD3, 46%). Ratings Rationale: MEI's B1 Corporate Family Rating reflects Moody's expectations that operating margins should improve from a combination of higher sales, better pricing, new product innovations, and ongoing cost reduction initiatives. Moody's also anticipates that some free cash flow will be used for debt reduction. As a result of margin expansion and lower levels of balance sheet debt, Moody's projects interest coverage -- defined as adjusted EBITA-to-interest expense -- could exceed 4.0 times by the end of fiscal 2014 (all ratios incorporate Moody's standard adjustments and adjustments to account for foreign exchange gains and losses on intercompany debt). The company's products serve a diverse, global customer base across myriad end markets, insulating MEI from cyclical downturns in any specific business segment or geographic region. Revenues from outside the Americas totaled slightly above 50% for 2012. Also, a good liquidity profile characterized by free cash flow generation and ample revolver availability gives MEI sufficient resources to meet growing demand for its products. With the exception of term loan amortization, MEI will face no near- term debt maturities. Rating constraints include the company's leveraged capital structure. According to Moody's calculations, MEI's adjusted debt- to-EBITDA is slightly over 5.0 times at closing. The company will also have negative tangible net worth. Moody's also considers MEI's significant exposure to Japan via its affiliate company and guarantor, MEI Conlux Holdings (Japan), Inc., a credit concern due weakness in the Japanese economy and the recent devaluation of the yen against the US dollar. MEI Conlux Holdings (Japan), Inc. retains about 27% of all the guarantors' assets. The positive rating outlook results from the potential acquisition of MEI by Crane Co., a much larger and better capitalized company relative to MEI. Crane Co. currently has a Baa2 senior unsecured rating with a stable rating outlook. An upgrade is possible if the acquisition of MEI by Crane Co. is completed, although Moody's anticipates withdrawing all the ratings associated with MEI at that time. However, even in the event that Crane's acquisition of MEI is not completed, if MEI improves its operating margins over the long term such that EBITA- to-interest expense nears 4.5 times for an extended period of time and debt-to-EBITDA is sustained below 4.25 times (all ratios include Moody's standard adjustments), then positive rating actions could be considered. Also, a significant amount of permanent debt reductions would also support upward rating pressure. Stabilization of the rating outlook will result if Crane Co. fails to acquire MEI. Also, negative rating actions could occur if MEI'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 falling below 3.0 times or debt-to-EBITDA sustained above 5.0 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 B1 rating assigned to the first lien senior secured bank credit facility, the same rating as the corporate family rating, reflects its position as the preponderance of debt in MEI's capital structure. The bank credit facility is comprised of a $60 million revolving credit facility expiring in 2018, and a $390 million term loan maturing in 2020. Each facility is secured by a first priority security interest in substantially all of MEI's assets, and both would be pari passu in a recovery scenario. The term loan amortizes 1% per year with a bullet payment at maturity. MEI Conlux Holdings (US), Inc., MEI, Inc.'s direct parent company, MEI Conlux Holdings (Japan), Inc., an affiliate company to MEI Conlux Holdings (US), Inc., and MEI, Inc.'s substantial subsidiaries guarantee the first lien bank credit facility. 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. MEI, Inc., headquartered in Malvern, PA, is a global manufacturer of unattended electronic payment systems, including electronic coin and bill acceptors and changers for the vending, gaming, transport and retail industries. Bain Capital and Advantage Partners, through their respective affiliates, are the majority owners of MEI. Revenues for the 12 months ended March 31, 2013 totaled approximately $400 million. MERISEL INC: Merger with Saints Takes Effect -------------------------------------------- Merisel, Inc., Saints Capital Granite, L.P., and Saints Capital Granite, LLC, filed with the U.S. Securities and Exchange Commission a final amendment to the Transaction Statement on Schedule 13E-3 in connection with the short-form merger of New Merisel with the Company pursuant to Section 253 of the Delaware General Corporation Law. The merger became effective on July 31, 2013. Merisel is the surviving corporation in the merger and is now a wholly owned subsidiary of Saints. As of the Effective Date, each share of Merisel common stock were cancelled and automatically converted into the right to receive $0.17 in cash, without interest. Each share of Merisel common stock held by New Merisel was cancelled and each of the 100 outstanding shares of New Merisel common stock held by Saints was converted into 225,000 shares of Merisel. The shares of redeemable Series A Preferred Stock of Merisel held by Saints remain outstanding. Meanwhile, Merisel filed a Form 15 with the SEC to terminate the registration of its common stock under Section 12(g) of the Securities Exchange Act of 1934. As of July 31, 2013, there was only one holder of the common shares. As a result of the Form 15 filing, the Company is suspending its obligation to file reports with the SEC. A copy of the Schedule 13E-3/A is available for free at: http://is.gd/S1B6Gj About Merisel Merisel operates in a single reporting segment, the visual communications services business. It entered that business beginning March 2005, through a series of acquisitions, which continued through 2006. These acquisitions include Color Edge, Inc., and Color Edge Visual, Inc.; Comp 24, LLC; Crush Creative, Inc.; Dennis Curtin Studios, Inc.; Advertising Props, Inc.; and Fuel Digital, Inc. Merisel incurred a net loss of $18.13 million in 2012, as compared with a net loss of $2.45 million in 2011. The Company's balance sheet at March 31, 2013, showed $25.13 million in total assets, $37.17 million in total liabilities and a $12.04 million total stockholders' deficit. MERISEL INC: Saints Capital No Longer Owns Shares ------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, Saints Capital Granite, L.P., and Saints Capital Granite, LLC, disclosed that as of July 31, 2013, they do not own shares of common stock of Merisel, Inc. Saints Capital previously disclosed beneficial ownership of 47,500,000 common shares or 95.5 percent equity stake as of Feb. 4, 2013. Effective July 26, 2013, Saints Capital contributed all of its shares of public common stock to Merisel Saints Newco, Inc., making Newco the holder of approximately 91 percent of the outstanding shares of public common stock. On July 31, 2013, Newco merged with and into Merisel in a short- form merger under Section 253 of the Delaware General Corporation Law, with Merisel as the surviving corporation in the merger. In connection with the merger, each share of public common stock (other than shares held by Newco and shares with respect to which appraisal rights have been properly exercised and not withdrawn or lost) was cancelled and (other than shares held in treasury) automatically converted into the right to receive $0.17 in cash, without interest. Each share of public common stock held by Newco was cancelled, and each of the 100 shares of Newco common stock held by the Saints Capital was converted into 225,000 shares of common stock in the surviving corporation. The shares of redeemable Series A Preferred Stock of Merisel remain outstanding. On July 31, 2013, Merisel filed a Form 15 to terminate its reporting obligations under the Securities Exchange Act of 1934. A copy of the regulatory filing is available at: http://is.gd/rbZoAU About Merisel Merisel operates in a single reporting segment, the visual communications services business. It entered that business beginning March 2005, through a series of acquisitions, which continued through 2006. These acquisitions include Color Edge, Inc., and Color Edge Visual, Inc.; Comp 24, LLC; Crush Creative, Inc.; Dennis Curtin Studios, Inc.; Advertising Props, Inc.; and Fuel Digital, Inc. Merisel incurred a net loss of $18.13 million in 2012, as compared with a net loss of $2.45 million in 2011. The Company's balance sheet at March 31, 2013, showed $25.13 million in total assets, $37.17 million in total liabilities and a $12.04 million total stockholders' deficit. MICROISLET INC: Islet Sciences Sued Over IP Asset Acquisition ------------------------------------------------------------- MUMFORD PC on Aug. 2 disclosed that according to Islet Holdings, new allegations of conspiracy and racketeering and a written confession from a scheme participant have led to the resignation of CEO John Steel and the restructuring of the management team at Islet Sciences, Inc. The restructuring was announced after an amended complaint was filed in federal court charging that Islet Sciences has been enticing investments using false documents, and that Steel has "made numerous threats against anyone related to Isletech." The litigation was brought by Islet Holdings, Inc., and its subsidiary Isletech, Inc., against Islet Sciences, Inc.; CEO John Steel; director Dr. Jonathan Lakey; and Charles Daniel Rhodes. According to Salt Lake attorney Marcus Mumford, who is representing Islet Holdings and Isletech in the lawsuit, the new complaint includes a confession from Mr. Rhodes admitting his participation in a fraud scheme orchestrated by Mr. Steel on behalf of Islet Sciences. In his confession, Mr. Rhodes describes how Isletech purchased intellectual property out of the MicroIslet, Inc., bankruptcy proceedings in 2009, but that Mr. Steel later "lied" and said that it had been purchased someone else. Mr. Steel then purported to transfer the MicroIslet property to Islet Sciences, which has been "building off the patents and intellectual property of MicroIslet" ever since. The amended federal complaint also alleges claims for violations of the Racketeer Influenced And Corrupt Organizations Act (Civil RICO) and theft. Islet Sciences, Inc., has claimed the intellectual property in filings with the SEC as part of its ongoing development of technologies for infusion therapy for insulin-dependent diabetes, including methods for culturing, isolation, maturation, and immunoprotection (microencapsulation) of islet cells. The lawsuit seeks a declaratory judgment to establish the ownership of the critical MicroIslet patents and intellectual property and damages for patent infringement. The case is Islet Holdings, Inc., et al. v. Islet Sciences, Inc., et al., Case No. 2:12-cv-00799-RJS (D. Utah), where the federal judge assigned to the case has queried whether anyone has reported the alleged activities to the enforcement arm of the SEC. As part of his firm's continuing investigation, Mumford encourages all persons with information about wrongdoing at Islet Sciences to contact his firm MUMFORD PC. Based in San Diego, Microislet, Inc. -- http://microislet.com/-- operates a biotechnology company engaged in the research, development and commercialization of patented technologies in the field of transplantation therapy for patients with diabetes. The company filed for Chapter 11 relief on Nov. 10, 2008 (Bankr. S.D. Calif. Case No. 08-11388). Victor A. Vilaplana, Esq., at Foley & Lardner LLP, represents the Debtor as counsel. The company did not state in its petition the amounts of its estimated assets and debts. MIDWEST FAMILY: Moody's Hikes Ratings on 2 Series 2006 A Bonds -------------------------------------------------------------- Moody's Investors Service has upgraded to Baa1 from Baa2 Class I; Ba1 from Ba2 Class II; B1 from B2 Class III; & B1 from B2 Class IV, the ratings on Midwest Family Housing LLC Military Housing Taxable Revenue Bonds (Navy Midwest Housing Privatization Project) 2006 Series A (collectively the "Bonds") based on the 2012 audited financial information for the project which shows a solid financial position for the project. Rating Rationale: The upgrades are based on solid 2012 audited financial performance of the project including strong debt service coverage at the various classes and rating levels and strong occupancy rates. The outlook on the ratings remain stable on the Class I & II Bonds and revised to positive on the Class III & Class IV Bonds, reflecting the likelihood that the ratings may be upgraded if performance remain strong. Strengths: - Strong financial performance as evidenced by debt service coverage ratios for 2012 that exceed underwriting standards on all classes of debt. - The overall occupancy rate has remained consistently stable at 94%. - Received BAH increases for the last three years, the FY2013 increase is 2.06%. - Experienced ownership and management team. Challenges: - Construction completion continues to be highly dependent on the sale of several parcels of land. - The debt service reserve fund on the Class I, II and III Bonds is with an unrated counterparty. What Could Change The Rating Up Although further upgrades on Class I & II are not immediately anticipated, consideration will be given if the project shows continued further increase of debt service coverage ratio in the medium term. Class III & IV may be more likely to be upgraded in the near term if there is continued growth in the debt service coverage. In addition, certain types of restructuring may be view as credit positives. These include cash funding of the debt service reserve funds at maximum annual debt service, replacement of the existing surety provider with an appropriately rated provider or an upgrade of the current surety provider. What Could Change The Rating Down A significant decline in BAH or occupancy levels that results in a decline in debt service coverage could adversely affect the ratings. Principal Methodology Used The principal methodology used in this rating was Global Housing Projects published in July 2010. MISSION NEW ENERGY: Had A$1.4 Million in Cash at June 30 -------------------------------------------------------- Mission New Energy Limited reported net operating cash flows of A$1.09 million for the quarter ended June 30, 2013. At the beginning of the quarter, the Company had A$113,000 in cash. The Company obtained cash from investments of A$130,000 and A$1.59 from financing. At the end of the quarter, the Company had A$1.42 million in cash. A copy of the report is available for free at http://is.gd/MGoLLj About Mission NewEnergy Based in Subiaco, Western Australia, Mission New Energy Limited is a producer of biodiesel that integrates sustainable biodiesel feedstock cultivation, biodiesel production and wholesale biodiesel distribution focused on the government mandated markets of the United States and Europe. The Company is not operating its biodiesel refining segment. The refineries are being held in care and maintenance either awaiting a return to positive operating conditions or the sale of assets. The Company has materially diminished its Jatropha contract farming operation and the company is now focused on divesting the remaining Indian assets. The Company intends to cease all Indian operations. Grant Thornton Audit Pty Ltd, in Perth, Australia, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company incurred operating cash outflows of A$4.9 million during the year ended June 30, 2012, and, as of that date, the consolidated entity's total liabilities exceeded its total assets by A$24.4 million. The Company's consolidated balance sheet at Dec. 31, 2012, showed $7.05 million in total assets, $27.29 million in total liabilities and a $20.24 million net deficit. MOBIVITY HOLDINGS: Names Jeff Hasen as Chief Marketing Officer -------------------------------------------------------------- Mobivity Holdings Corp. appointed Jeff Hasen to serve as the Company's chief marketing officer on July 22, 2013. The compensation committee of the Company's board of directors also approved the employment agreement between the Company and Mr. Hasen. Mr. Hasen's duties and authorities include those typically associated with the office of chief marketing officer and Mr. Hasen has agreed to devote all of his business time to the affairs of the Company. The Company has agreed to pay Mr. Hasen a base salary $180,000, subject to annual review by the compensation committee of the Company's board of directors. The Company has also agreed to pay Mr. Hasen a quarterly bonus of one-quarter of one percent (0.25 percent) of the gross revenues of the Company. Pursuant to his employment agreement with the Company, Mr. Hasen is eligible to participate in all benefits, plans, and programs, including improvements or modifications of the same, which are now, or may hereafter be, available to the Company's executive employees. Mr. Hasen's employment agreement contains standard provisions concerning noncompetition, nondisclosure and indemnification. Pursuant to Mr. Hasen's employment agreement, the Company agreed to grant Mr. Hasen an option to purchase 1,669,304 shares of the Company's common stock, over a 4 year period from the date of grant, at an exercise price $0.65 per share. Options to purchase 834,652 shares of common stock will vest and first become exercisable over a four year period at the rate of 1/48th shares per month commencing on the first month following the date of grant. Options to purchase the remaining 834,652 shares of common stock will vest and first become exercisable when we realize $20,000,000 of gross revenue over any fiscal year. Mr. Hasen's option will otherwise be on the terms and conditions of the Company's current equity incentive plan. Mr. Hasen, age 54, previously served as chief marketing officer of Hipcricket, Inc., a wholly owned subsidiary of Augme Technologies, Inc., from May 2007 until March 2013. Mr. Hasen has a Bachelor's of Arts degree (1980) in TV/Radio from Brooklyn College About Mobivity Holdings Mobivity Holdings Corp. was incorporated as Ares Ventures Corporation in Nevada in 2008. On Nov. 2, 2010, the Company acquired CommerceTel, Inc., which was wholly-owned by CommerceTel Canada Corporation, in a reverse merger. Pursuant to the Merger, all of the issued and outstanding shares of CommerceTel, Inc., common stock were converted, at an exchange ratio of 0.7268-for-1, into an aggregate of 10,000,000 shares of the Company's common stock, and CommerceTel, Inc., became a wholly owned subsidiary of the Company. In connection with the Merger, the Company changed its corporate name to CommerceTel Corporation on Oct. 5, 2010. In connection with the Company's acquisition of assets from Mobivity, LLC, the Company changed its corporate name to Mobivity Holdings Corp. and its operating company to Mobivity, Inc, on Aug. 23, 2012. Mobivity Holdings disclosed a net loss of $7.33 million in 2012, as compared with a net loss of $16.31 million in 2011. The Company's balance sheet at March 31, 2013, showed $3.25 million in total assets, $10.25 million in total liabilities, all current, and a $6.99 million total stockholders' deficit. M&K CPAS, PLLC, in Houston, Texas, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012, citing recurring operating losses and negative cash flows from operations and dependence on additional financing to fund operations which raise substantial doubt about the Company's ability to continue as a going concern. Bankruptcy Warning "[A]ll of our assets are currently subject to a first priority lien in favor of the holders of our outstanding convertible notes payable in the current aggregate principal amount of $4,521,378. The notes are due on October 15, 2013, if we are unable to repay or refinance our obligations under those notes by October 15, 2013, the holders of the notes will have the right to foreclose on their security interests and seize our assets. To avoid such an event, we may be forced to seek bankruptcy protection, however a bankruptcy filing would, in all likelihood, materially adversely affect our ability to continue our current level of operations. In the event we are not able to refinance or repay the notes, but negotiate for a further extension of the maturity date of the notes, we may be required to pay significant extension fees in cash or shares of our equity securities or otherwise make other forms of concessions that may adversely impact the interests of our common stockholders," the Company has warned in its annual report for the year ended Dec. 31, 2012. MOBIVITY HOLDINGS: ACT Capital Held 9.9% Equity Stake at June 17 ---------------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, ACT Capital Management, LLLP, and its affiliates disclosed that as of June 17, 2013, they beneficially owned 10,064,576 shares of common stock of Mobivity Holdings Inc. representing 9.99 percent of the shares outstanding. A copy of the regulatory filing is available at http://is.gd/qo7eOv About Mobivity Holdings Mobivity Holdings Corp. was incorporated as Ares Ventures Corporation in Nevada in 2008. On Nov. 2, 2010, the Company acquired CommerceTel, Inc., which was wholly-owned by CommerceTel Canada Corporation, in a reverse merger. Pursuant to the Merger, all of the issued and outstanding shares of CommerceTel, Inc., common stock were converted, at an exchange ratio of 0.7268-for-1, into an aggregate of 10,000,000 shares of the Company's common stock, and CommerceTel, Inc., became a wholly owned subsidiary of the Company. In connection with the Merger, the Company changed its corporate name to CommerceTel Corporation on Oct. 5, 2010. In connection with the Company's acquisition of assets from Mobivity, LLC, the Company changed its corporate name to Mobivity Holdings Corp. and its operating company to Mobivity, Inc, on Aug. 23, 2012. Mobivity Holdings disclosed a net loss of $7.33 million in 2012, as compared with a net loss of $16.31 million in 2011. The Company's balance sheet at March 31, 2013, showed $3.25 million in total assets, $10.25 million in total liabilities, all current, and a $6.99 million total stockholders' deficit. M&K CPAS, PLLC, in Houston, Texas, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012, citing recurring operating losses and negative cash flows from operations and dependence on additional financing to fund operations which raise substantial doubt about the Company's ability to continue as a going concern. Bankruptcy Warning "[A]ll of our assets are currently subject to a first priority lien in favor of the holders of our outstanding convertible notes payable in the current aggregate principal amount of $4,521,378. The notes are due on October 15, 2013, if we are unable to repay or refinance our obligations under those notes by October 15, 2013, the holders of the notes will have the right to foreclose on their security interests and seize our assets. To avoid such an event, we may be forced to seek bankruptcy protection, however a bankruptcy filing would, in all likelihood, materially adversely affect our ability to continue our current level of operations. In the event we are not able to refinance or repay the notes, but negotiate for a further extension of the maturity date of the notes, we may be required to pay significant extension fees in cash or shares of our equity securities or otherwise make other forms of concessions that may adversely impact the interests of our common stockholders," the Company has warned in its annual report for the year ended Dec. 31, 2012. MONARCH COMMUNITY: Incurs $929,000 Net Loss in Second Quarter ------------------------------------------------------------- Monarch Community Bancorp, Inc., reported a loss of $929,000 for the quarter ended June 30, 2013, compared to a loss of $372,000 for the same period in 2012. The Company disclosed a net loss of $1.15 million on $3.78 million of interest income for the six months ended June 30, 2013, as compared with a net loss of $675,000 on $4.51 million of interest income for the same period during the prior year. As of June 30, 2013, the Company had $185.72 million in total assets, $176.73 million in total liabilities and $8.98 million in stockholders' equity. "We are pleased with the significant progress of the bank, particularly in the reduction of problem loans," stated Richard J. DeVries, president and CEO of Monarch Community Bank and Monarch Community Bancorp, Inc. "Our non-performing loans, which reached a peak of almost $24 million in 2010, totaled only $3.0 million as of June 30, 2013. This large reduction reflects a steady, disciplined approach to problem loan resolution." A copy of the press release is available for free at: http://is.gd/Po9Vyw About Monarch Community Coldwater, Michigan-based Monarch Community Bancorp, Inc., was incorporated in March 2002 under Maryland law to hold all of the common stock of Monarch Community Bank, formerly known as Branch County Federal Savings and Loan Association. The Bank converted to a stock savings institution effective Aug. 29, 2002. In connection with the conversion, the Company sold 2,314,375 shares of its common stock in a subscription offering. Plante & Moran, PLLC, in Auburn Hills, Michigan, expressed substantial doubt about Monarch Community's ability to continue as a going concern following the Company's annual report for the year ended Dec. 31, 2011. The independent auditors noted that the Corporation has suffered recurring losses from operations and as of Dec. 31, 2011, did not meet the minimum capital requirements as established by the regulators. The Corporation reported a net loss of $353,000 on $6.8 million of net interest income (before provision for loan losses) in 2011, compared with a net loss of $10.9 million on $7.5 million of net interest income (before provision for loan losses) in 2010. Total non-interest income was $4.0 million for 2011, compared with $3.7 million for 2010. MOORE FREIGHT: Plan Disclosures Hearing on September 10 ------------------------------------------------------- The hearing to approve the adequacy of the Disclosure Statement for Moore Freight Service, Inc., and G.R.E.A.T. Logistics, Inc.'s Joint Plan of Reorganization dated July 24, 2013, will be held on Sept. 10, 2013, at 9:00 a.m. According to the Disclosure Statement, the Plan provides for the continuation of Debtors' business, the payment in full of Allowed Secured Claims, and a fair distribution to unsecured creditors, which distribution far exceeds the amount unsecured creditors would receive in the event of a Chapter 7 liquidation. Each Holder of an allowed unsecured claim will receive its Pro rata share of (i) $80,000 on the Effective Date of the Plan; (ii) $600,000, payable in installments of $50,000 each on July 1 and November 1 of each calendar year beginning in 2014; and (iii) one- third of any additional recovery from Pilot Flying J. Existing owners Dan Moore and Judith Moore will retain all of their ownership interests in Debtors as consideration for the existing and continuing personal guaranties of several of Debtors' obligations. The ownership interests of SJ Strategic Investments LLC and Norene Nichols (or her heirs) in Moore Freight will be terminated upon Confirmation, unless on or before the Confirmation Date, these remaining equity security holders contribute capital to Moore Freight in a pro rata amount equal to the total debt guaranteed by Dan Moore and Judith Moore, which amounts will be used to fund payments provided for in the Plan. According to papers filed with the U.S. Bankruptcy Court for the Middle District of Tennessee, the Debtors' cash on hand as of the Petition Date and Cash generated from the operation of business after the Petition Date will be sufficient to make all payments due on the Effective Date. Cash generated from the operation of business after the Effective Date, after service of exit financing, will generate sufficient cash flow to make all payments due under the Plan. A copy of the Disclosure Statement is available at: http://bankrupt.com/misc/moorefreight.doc740.pdf Counsel for the Debtors may be reached at: Barbara D. Holmes, Esq. Craig V. Gabbert, Jr., Esq. Glenn B. Rose, Esq. Barbara D. Holmes, Esq. David P. Ca�as, Esq. Tracy M. Lujan, Esq. HARWELL HOWARD HYNE GABBERT & MANNER, P.C. 333 Commerce Street, Suite 1500 Nashville, TN Tel: (615) 256-0500 Fax: (615) 251-1059 E-mail: bdh@h3gm.com About Moore Freight Service and G.R.E.A.T. Logistics Moore Freight Service, Inc. and G.R.E.A.T. Logistics Inc. sought Chapter 11 protection (Bankr. M.D. Tenn. Case Nos. 12-08921 and 12-08923) in Nashville on Sept. 28, 2012. Moore Freight is a freight service company specializing in flat gas transportation. Founded in 2001, Moore is the largest commercial flat glass logistics firm in the U.S. It operates in the U.S., Canada and Mexico. GLI does not have any operations other than the limited, occasional freight brokerage services currently provided to Moore Freight. Bankruptcy Judge Keith M. Lundin oversees the cases. Attorneys at Harwell Howard Hyne Gabbert & Manner PC serve as counsel. LTC Advisory Services LLC serves as the Debtor's financial advisors. Moore Freight estimated assets and debts of $10 million to $50 million. CEO Dan R. Moore signed the petitions. Counsel for the Debtor's pre-bankruptcy and DIP lender, Marquette Transportation Finance, Inc., are Linda W. Knight, Esq., at Gullett, Sanford, Robinson & Martin, PLLC; and Thomas J. Lallier, Esq., at Foley & Mansfield PLLP. MOTORS LIQUIDATION: C. Tully is FTI's Corporate Finance Director ---------------------------------------------------------------- Anna Mary Phillips was succeeded in her role as senior managing director in the Corporate Finance/Restructuring practice of FTI Consulting, Inc., by Conor P. Tully on July 31, 2013. Mr. Tully has more than 18 years of experience in providing clients with strategic planning, merger and acquisition advisory and business advisory services in both distressed and healthy company situations. For the past 15 years, Mr. Tully has specialized in providing restructuring services to companies, financial institutions and creditors in the troubled company environment, including both formal Chapter 11 proceedings and out- of-court workout situations. Mr. Tully's industry experience includes the automotive, financial services, consumer products, telecom, metals, energy and manufacturing industries. Prior to joining FTI Consulting, in October, 2004, Mr. Tully was a director in the restructuring practice of Ernst & Young Corporate Finance LLC. Mr. Tully holds a B.A. in accountancy from Manhattan College. He is a certified public accountant, a certified insolvency and restructuring advisor, a certified turnaround professional, and is accredited in business valuation. Mr. Tully is also a member of the American Bankruptcy Institute, the American Institute of Certified Public Accountants, the Association of Insolvency and Restructuring Advisors, the New York State Society of Certified Public Accountants and the Turnaround Management Association. Motors Liquidation Company GUC Trust is required to make disclosures relating to certain individuals who are employed in a leadership capacity by FTI Consulting in its capacity as monitor of the GUC Trust. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on June 1, 2009. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Garden City Group is the claims and notice agent of the Debtors. The U.S. Trustee appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP served as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long served as counsel on supplier contract matters. FTI Consulting Inc. served as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represented the Asbestos Committee. Legal Analysis Systems, Inc., served as asbestos valuation analyst. The Bankruptcy Court entered an order confirming the Debtors' Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan was declared effect on March 31. On Dec. 15, 2011, Motors Liquidation Company was dissolved. On the Dissolution Date, pursuant to the Plan and the Motors Liquidation Company GUC Trust Agreement, dated March 30, 2011, between the parties thereto, the trust administrator and trustee -- GUC Trust Administrator -- of the Motors Liquidation Company GUC Trust, assumed responsibility for the affairs of and certain claims against MLC and its debtor subsidiaries that were not concluded prior to the Dissolution Date. MOUNTAIN COUNTRY: Trustee Hires Turner & Johns as Counsel --------------------------------------------------------- Robert L. Johns, the Chapter 11 Trustee for the bankruptcy estate of Mountain Country Partners, LLC, asks the U.S. Bankruptcy Court for the Southern District of West Virginia for authorization to employ the law firm of Turner & Johns, PLLC, as counsel for the Chapter 11 Trustee, nunc pro tunc to July 6, 2013. The hearing to consider the application of Turner & Johns as counsel for the Chapter 11 Trustee is scheduled for Aug. 14, 2013, at 2:30 p.m. The law firm will, among others, provide these professional services: * To conduct real estate title examinations to determine the identity and extent of oil and gas interests owned by the estate; * To represent Trustee in liquidating assets of the Debtor; * To represent the Trustee in disputes with the West Virginia Department of Environmental Protection relative to permits for wastewater disposal wells and well plugging issues; and * To give Trustee advice with respect to his powers and duties and assist him as needed in his administration of the Debtor's estate. To the best of the Trustee's knowledge, the law firm of Turner & Johns, PLLC, is a "disinterested person" within the meaning of Sec. 101(14) of the Bankruptcy Code. The law firm's hourly rates are $175 to $370 for attorneys, and $90 for paralegals. About Mountain Country Seven individual investors filed an involuntary Chapter 11 bankruptcy petition against Jacksonville, Florida-based Mountain Country Partners, LLC (Bankr. S.D. W.Va. Case No. 12-20094) on Feb. 17, 2012. Judge Ronald G. Pearson presides over the case. Joseph W. Caldwell, Esq., at Caldwell & Riffee, represent the petitioners. An Order for Relief was entered by the Court on June 25, 2012. Robert L. Johns was appointed Chapter 11 Trustee on July 6, 2012. James W. Lane, Jr., at the Law Offices of Jim Lane, Jr., represents the Debtor as counsel. The law firm of Turner & Johns, PLLC, represents Chapter 11 Trustee Robert L. Johns, as counsel. MPG OFFICE: BPO Extends Expiration of Tender Offer to Aug. 9 ------------------------------------------------------------ Brookfield Office Properties Inc., through its newly formed fund, is extending its previously announced cash tender offer to purchase all outstanding shares of preferred stock of MPG Office Trust, Inc., until 12:00 midnight, New York City time, at the end of Friday, Aug. 9, 2013. BPO previously announced its intention to acquire MPG pursuant to a merger agreement, dated as of April 24, 2013. Upon the closing of the tender offer, preferred stockholders of MPG will receive $25.00 in cash for each share of MPG preferred stock validly tendered and not validly withdrawn in the offer, without interest and less any required withholding taxes. Shares of MPG preferred stock that are tendered and accepted for payment in the tender offer will not receive any accrued and unpaid dividends on those shares. BPO also announced that DTLA Fund Holding Co. is assigning to Brookfield DTLA Fund Properties Holding Inc., another direct wholly-owned subsidiary of the DTLA Fund, all of its rights and obligations to purchase all preferred shares tendered into the offer, if any, in excess of 50 percent of the issued and outstanding shares of MPG preferred stock. This assignment to Properties Holding Inc. will not affect tendering stockholders in the offer and does not relieve DTLA Fund Holding Co. of its obligations to the holders of preferred stock who have tendered their shares into the offer. The tender offer had been previously set to expire at 12:00 midnight, New York City time, at the end of Friday, Aug. 2, 2013. Except for the extension of the expiration date and the partial assignment of the offer from DTLA Fund Holding Co. to Properties Holding Inc., all other terms and conditions of the tender offer remain unchanged. The Depositary and Paying Agent for the tender offer is American Stock Transfer & Trust Company, LLC, 6201 15th Avenue, Brooklyn, New York 11219. The Information Agent for the tender offer is MacKenzie Partners, Inc., 105 Madison Avenue, New York, New York 10016. The tender offer materials may be obtained at no charge by directing a request by mail to MacKenzie Partners, Inc., or by calling (800) 322-2885. Fried, Frank, Harris, Shriver & Jacobson LLP is acting as legal advisor to BPO. Based on information received from the Depositary, as of Aug. 1, 2013, approximately 75,599 shares of MPG preferred stock had been tendered and not withdrawn from the offer. Stockholders who have already tendered their shares do not have to re-tender their shares or take any other action as a result of the extension of the expiration date. About MPG Office Trust MPG Office Trust, Inc., fka Maguire Properties Inc. -- http://www.mpgoffice.com/-- owns and operates Class A office properties in the Los Angeles central business district and is primarily focused on owning and operating high-quality office properties in the Southern California market. MPG Office Trust is a full-service real estate company with substantial in-house expertise and resources in property management, marketing, leasing, acquisitions, development and financing. For the year ended Dec. 31, 2012, the Company reported net income of $396.11 million, as compared with net income of $98.22 million on $234.96 million of total revenue during the prior year. The Company's balance sheet at March 31, 2013, showed $1.45 billion in total assets, $1.98 billion in total liabilities, and a $530.56 million total deficit. In its Form 10-K filing with the Securities and Exchange Commission for the fiscal year ended Dec. 31, 2012, the Company said it is working to address challenges to its liquidity position, particularly debt maturities, leasing costs and capital expenditures. The Company said, "We do not currently have committed sources of cash adequate to fund all of our potential needs, including our 2013 debt maturities. If we are unable to raise additional capital or sell assets, we may face challenges in repaying, extending or refinancing our existing debt on favorable terms or at all, and we may be forced to give back assets to the relevant mortgage lenders. While we believe that access to future sources of significant cash will be challenging, we believe that we will have access to some of the liquidity sources identified above and that those sources will be sufficient to meet our near- term liquidity needs." On March 11, 2013, the Company entered into an agreement to sell US Bank Tower and the Westlawn off-site parking garage. The transaction is expected to close June 28, 2013, subject to customary closing conditions. The net proceeds from the transaction are expected to be roughly $103 million, a portion of which may potentially be used to make loan re-balancing payments on the Company's upcoming 2013 debt maturities at KPMG Tower and 777 Tower. Roughly $898 million of the company's debt matures in 2013. "Our ability to access the capital markets to raise capital is highly uncertain. Our substantial indebtedness may prevent us from being able to raise debt financing on acceptable terms or at all. We believe we are unlikely to be able to raise equity capital in the capital markets," the Company said. "Future sources of significant cash are essential to our liquidity and financial position, and if we are unable to generate adequate cash from these sources we will have liquidity-related problems and will be exposed to material risks. In addition, our inability to secure adequate sources of liquidity could lead to our eventual insolvency." MUSCLEPHARM CORP: Teams Up with Arnold Schwarzenegger ----------------------------------------------------- MusclePharm Corporation has signed a first-of-its-kind partnership with the Mr. Universe, Mr. World and Mr. Olympia title holder, actor, entrepreneur and former Governor Arnold Schwarzenegger. Mr. Schwarzenegger has won more world bodybuilding titles than anyone in history and has produced the popular Arnold Classic in Columbus, Ohio, for 25 years. As part of the collaboration, MusclePharm will launch the Arnold Series, an exclusive line of new nutritional supplements developed by Schwarzenegger and MusclePharm's world-renowned scientific team. The Arnold Series product line will initially launch with eight supplements supporting the four fitness pillars: performance, power & strength, nutrient support and recovery. It will be available domestically and internationally at health and nutrition stores as well as online retailers in September 2013. "I've been on a crusade to promote fitness for more than four decades," said Mr. Schwarzenegger. "That has led to the largest health and fitness convention in the world, six books, seminars all over the globe, and visits to all 50 states as chairman of the President's Council on Physical Fitness. This vitamin and supplement line is the next step. After meeting with the MusclePharm team, learning about the company, and spending time with the founders, I knew they were the perfect partners to start a line of nutritional supplements and continue promoting fitness around the world. Their passion for sports nutrition and science fits perfectly with my mission to help everyone discover the benefits of health and nutrition. I'm excited to partner with MusclePharm on the exclusive Arnold Series and develop this line of nutritional supplements that not only carry my name but also represent my lifelong commitment to fitness." "Arnold is a bodybuilding, fitness icon who is and has been a personal idol of mine since high school," said Brad Pyatt, CEO and founder, MusclePharm. "His philosophy of 'where there's a will, there's a way' inspired me during my NFL career and while starting MusclePharm. Arnold embodies everything the MusclePharm brand stands for; it's truly a dream come true and an honor to create the Arnold Series nutritional experience with him." About MusclePharm Headquartered in Denver, Colorado, MusclePharm Corporation (OTC BB: MSLP) -- http://www.muslepharm.com/-- is a healthy life- style company that develops and manufactures a full line of National Science Foundation approved nutritional supplements that are 100 percent free of banned substances. MusclePharm is sold in over 120 countries and available in over 5,000 U.S. retail outlets, including GNC and Vitamin Shoppe. MusclePharm products are also sold in over 100 online stores, including bodybuilding.com, Amazon.com and Vitacost.com. The Company reported a net loss of $23.28 million in 2011, compared with a net loss of $19.56 million in 2010. The Company's balance sheet at March 31, 2013, showed $20.53 million in total assets, $13.31 million in total liabilities and $7.22 million in total stockholders' equity. In the auditors' report accompanying the consolidated financial statements for the year ended Dec. 31, 2011, Berman & Company, P.A., in Boca Raton, Florida, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors noted that the Company has a net loss of $23,280,950 and net cash used in operations of $5,801,761 for the year ended Dec. 31, 2011; and has a working capital deficit of $13,693,267, and a stockholders' deficit of $12,971,212 at Dec. 31, 2011. NATIVE WHOLESALE: Hearing on Case Dismissal Bid Starts ------------------------------------------------------ The hearing on the U.S. Trustee's motion to convert Native Wholesale Supply Company's Chapter 11 case to Chapter 7, or dismiss the Chapter 11 case was slated for Aug. 5, 2013 before the U.S. Bankruptcy Court for the Western District of New York. The hearing on the motion has been adjourned several times. According to Tracy Hope Davis, the U.S. Trustee for Region 2: 1. the Debtor has an inability to perform the statutory duties of a debtor-in-possession and to comply with the requirements of the Chapter 11 Operating Guidelines; 2. the Debtor has failed to file monthly financial reports for the months of February and March 2013. The States of California, Idaho, New Mexico, New York, and Oklahoma filed a statement in partial support of the U.S. Trustee's motion. The States assert that it would be inappropriate to dismiss the case at this stage of the proceedings; rather, if the case does not remain in Chapter 11, only conversion is in the best interest of creditors and the estate. The States further assert that if the Court does not believe that either conversion or dismissal is warranted at this point, they ask that the Court set deadlines for the Debtor to file a disclosure statement and a plan so as to avoid having the case languish in Chapter 11, with no discernible progress, while the Debtor continues to market its products in violation of applicable state law. The States also ask the Court to withdraw its oral ruling on the motion to dismiss. According to Craig T. Lutterbein, Esq., at Hodgson Russ LLP, in Buffalo, New York, on Sept. 27, 2012, the Court issued an oral ruling that it would allow the Debtor to dismiss its Chapter 11 proceeding on the satisfaction of certain conditions -- mainly the securitization of the State of California's potential administrative claim. Despite that ruling by the Court, the Debtor still has not completed the necessary steps to effectuate a dismissal pursuant to the Oral Ruling, Mr. Lutterbein says. It now appears that nearly all of the bases that the Court relied on to justify the Oral Ruling now militate against dismissal and in favor of either keeping the Debtor's bankruptcy case in Chapter 11 proceeding or converting the Debtor's bankruptcy case to one under Chapter 7, the States assert. The States are also represented by Garry M. Graber, Esq., at Hodgson Russ LLP, in Buffalo, New York, and Karen Cordry, Esq., National Association of Attorneys General, in Washington, D.C. About Native Wholesale Supply Company Native Wholesale Supply Company is engaged in the business of importing cigarettes and other tobacco products from Canada and selling them to third parties within the United States. It purchases the products from Grand River Enterprises Six Nations, Ltd., a Canadian corporation and the Debtor's only secured creditor. Native is an entity organized under the Sac and Fox Nation and has its principal place of business at 10955 Logan Road in Perrysburg, New York. Native filed for Chapter 11 bankruptcy (Bankr. W.D.N.Y. Case No. 11-14009) on Nov. 21, 2011. The Chapter 11 filing was triggered to resolve an ongoing dispute with the United States government regarding up to $43 million in assessments made by the government against the Debtor pursuant to the Fair and Equitable Tobacco Reform Act of 2004 and the Tobacco Transition Payment Program and to restructure the terms of payment of any obligation determined to be owing by the Debtor to the U.S. under the Disputed Assessment. The issues pertaining to the Disputed Assessment resulted in two lawsuits, subsequently consolidated, now pending in the Federal District Court. Robert J. Feldman, Esq., and Janet G. Burhyte, Esq., at Gross, Shuman, Brizdle & Gilfillan, P.C., in Buffalo, N.Y., represent the Debtor as counsel. The Company disclosed $30,022,315 in assets and $70,590,564 in liabilities as of the Chapter 11 filing. The States of California, New Mexico, Oklahoma and Idaho have appeared in the case and are represented by Garry M. Graber, Esq., at Hodgson Russ LLP. No trustee, examiner or creditors' committee has been appointed in the case. NATIVE WHOLESALE: Files Renewed Application to Employ Gable ----------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of New York previously authorized Native Wholesale Supply Company to employ Gable & Gotwals, P.C., as special counsel with respect to all matters pertaining to the action pending in the District Court of Oklahoma County, State of Oklahoma, Case No. CJ-2008-4942. Although the Bankruptcy Court approved the employment application, it denied the nunc pro tunc aspect of the employment application, without prejudice to the Debtor's submission of a further showing of "extraordinary circumstances" warranting the nunc pro tunc employment. In accordance with the Bankruptcy Court's directive, the Debtor files a renewed motion to employ the firm, nunc pro tunc to Oct. 16, 2012. In support of its renewed employment application, it files the affidavits of Thomas W. Gruber, Gregory Thomas Metcalfe, and Robert Luddy, which together describe how Gable was employed by the Debtor on Oct. 16, 2012, but did not seek approval as special counsel in the Chapter 11 case until the original employment application was filed on April 26, 2013. According to the Debtor, the facts contained in the affidavits will demonstrate that extraordinary circumstances do indeed exist here, warranting the nunc pro tunc approval requested. The renewed employment application was filed by Janet G. Burhyte, Esq., and Robert J. Feldman, Esq., at Gross, Shuman, Brizdale & Gilfillan, P.C., in Buffalo, New York; and Mark D.G. Sanders, Esq. -- msanders@gablelaw.com -- and Sidney K. Swinson, Esq., at Gable & Gotwals, P.C., in Tulsa, Oklahoma, on behalf of the Debtor. A hearing on the Debtor's renewed application will be held on Aug. 23, 2013, at 01:00 PM. About Native Wholesale Supply Company Native Wholesale Supply Company is engaged in the business of importing cigarettes and other tobacco products from Canada and selling them to third parties within the United States. It purchases the products from Grand River Enterprises Six Nations, Ltd., a Canadian corporation and the Debtor's only secured creditor. Native is an entity organized under the Sac and Fox Nation and has its principal place of business at 10955 Logan Road in Perrysburg, New York. Native filed for Chapter 11 bankruptcy (Bankr. W.D.N.Y. Case No. 11-14009) on Nov. 21, 2011. The Chapter 11 filing was triggered to resolve an ongoing dispute with the United States government regarding up to $43 million in assessments made by the government against the Debtor pursuant to the Fair and Equitable Tobacco Reform Act of 2004 and the Tobacco Transition Payment Program and to restructure the terms of payment of any obligation determined to be owing by the Debtor to the U.S. under the Disputed Assessment. The issues pertaining to the Disputed Assessment resulted in two lawsuits, subsequently consolidated, now pending in the Federal District Court. Robert J. Feldman, Esq., and Janet G. Burhyte, Esq., at Gross, Shuman, Brizdle & Gilfillan, P.C., in Buffalo, N.Y., represent the Debtor as counsel. The Company disclosed $30,022,315 in assets and $70,590,564 in liabilities as of the Chapter 11 filing. The States of California, New Mexico, Oklahoma and Idaho have appeared in the case and are represented by Garry M. Graber, Esq., at Hodgson Russ LLP. No trustee, examiner or creditors' committee has been appointed in the case. NEW ENTERPRISE: S&P Revises Outlook to Neg. & Affirms 'CCC' CCR --------------------------------------------------------------- Standard & Poor's Ratings Services said to that it revised its rating outlook on New Enterprise, Pa.-based New Enterprise Stone & Lime Co. Inc. (NESL) to negative from developing. S&P affirmed all its ratings, including the 'CCC' corporate credit rating. "The outlook revision reflects our assessment that given the failure of the Pennsylvania state legislature to enact a proposed $1.8 billion increase in state transportation funding before the June 30 legislative recess, prospects for a near-term increase in demand for NESL's products and services have diminished. More than 50% of NESL's revenues are derived from state and municipal construction projects in Pennsylvania, NESL's primary market. Our previous developing outlook reflected the potential for a significantly improved demand environment for NESL had the proposed increase in state transportation funding been approved. While consideration of Gov. Corbett's transportation proposal, as well as several other alternatives, may be taken up when the legislature comes into session in September, the ultimate terms, amount, and timing of the bill, if approved at all, are uncertain," S&P noted. "The negative outlook reflects our view that we could downgrade the company if NESL fails to improve operating profitability or if there are renewed difficulties in meeting financial agreements. A downgrade could also occur if NESL's liquidity were to become further constrained, due either to a further drop in earnings, reduced borrowing-base availability under the revolving credit facility, or a covenant violation under its debt agreements," said Standard & Poor's credit analyst Thomas Nadramia. Although S&P views an upgrade as unlikely at this time, one could occur if NESL significantly improves profitability and liquidity (to "adequate" as defined by S&P's criteria) and is able to benefit from any potential increase in state funding for transportation initiatives in Pennsylvania. NEXTRACTION ENERGY: Enters Into Loan Amendment with Tallin ---------------------------------------------------------- Nextraction Energy Corp. on Aug. 2 disclosed that it has entered into an amending agreement to extend the principal repayment of its non-revolving term loan facility with Tallinn Capital Mezzanine Limited Partnership. Tallinn has agreed to waive monthly net sales production minimum requirement and minimum current ratio requirements which the Company had been in default of until September 30, 2013. Furthermore, subject to the debentures proposed to be offered pursuant to the Company's recently announced proposed short form prospectus offering being subordinated and postponed to the Loan Facility on terms acceptable to Tallinn, the successful completion of the Offering and the Company not otherwise being in default under the Loan Facility, Tallinn has also agreed to waive requirements to repay the Loan Facility from proceeds of the Offering beyond the first $2 million of the principal amount owing under the Loan Facility on the earlier of September 30, 2013 or the closing of the Offering. About Nextraction Energy Corp. Nextraction Energy Corp. is a Canadian junior oil and natural gas company engaged in the exploration and development of oil and natural gas resources in the Western Canadian Basin. The Company's model is the "next round of extraction on known plays." Nextraction targets oil focused projects along trends with known reserves that provide low risk, high return development opportunities in both conventional and unconventional resource projects. NORTHLAND CABLE: Partnership Agreement Expires December 13 ---------------------------------------------------------- Northland Cable Properties Eight Limited Partnership filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q, reporting net income of $83,009 on $1.14 million of service revenues for the three months ended June 30, 2013, compared with net income of $57,909 on $1.07 million of service revenues for the same period last year. The Partnership reported net income of $200,909 on $2.26 million of service revenues for the six months ended June 30, 2013, compared with net income of $172,562 on $2.13 million of service revenues for the corresponding period of 2012. The Partnership's balance sheet at June 30, 2013, showed $5.77 million in total assets, $1.14 million in total liabilities, and partners' capital of $4.63 million. Northland Communications Corporation (the General Partner or Northland) manages the operations and is the General Partner of the Partnership under the terms of a Partnership Agreement which will expire on Dec. 31, 2013. According to the Form 10-Q, the General Partner intends to submit a proxy statement in 2013 that will include a request for an extension of the Partnership term. "The extension of the Partnership's life will require approval from a majority of its limited partners. No assurances can be given that a majority of the limited partners will approve an extension of the Partnership's life. Given this fact, the Partnership's ability to continue as a going concern is in substantial doubt at June 30, 2013." "Failure to extend the term of the Partnership would result in dissolution of the Partnership at Dec. 31, 2013." A copy of the Form 10-Q is available at http://is.gd/zKGQdw Seattle, Washington-based Northland Cable Properties Eight Limited Partnership is a Washington limited partnership consisting of one general partner and 852 limited partners holding 19,087 partnership units as of Dec. 31, 2012. Northland Communications Corporation, a Washington corporation, is the General Partner of the Partnership. The General Partner manages the operations of the Partnership under the terms of a Partnership Agreement which will expire on Dec. 31, 2013. The Partnership was formed on Sept, 21, 1988, and began operations in 1989. The Partnership serves the communities and surrounding areas of Aliceville, Alabama and Swainsboro, Georgia (the "Systems"). As of June 30, 2013, the total number of basic video subscribers served by the Systems was 3,764. The Partnership has 11 non-exclusive franchises to operate the Systems. These franchises, which will expire at various dates through the year 2019, have been granted by local and county authorities in the areas in which the Systems operate. NORTHLAND RESOURCES: Implements Final Steps of Bond Restructuring ----------------------------------------------------------------- Northland Resources S.A. and Northland Resources AB announced implementation of the final steps of restructuring of the bond loans previously issued by Northland Resources AB. As previously announced, Northland's Extraordinary General Meeting on July 31, 2013 approved all resolutions. The Board therefore resolved to go through with the contemplated restructuring of the bond loans previously issued by Northland Resources AB with ISIN NO0010636137 and ISIN NO0010636194. The Second Lien Bonds are amended into the Second Lien Convertible Bonds on the terms set out in the Second Amendment and Restatement Bond Agreement dated 7 June 2013, between, amongst others, NRSA as issuer of the Second Lien Convertible Bonds and Norsk Tillitsmann ASA as bond trustee on behalf of the holders of the Second Lien Convertible Bonds. A copy of the Second Lien Convertible Bond Agreement is available on Stamdata at http://www.stamdata.no Having obtained the requisite approvals, Northland is taking all steps necessary to implement the final stages of the restructuring, including making the necessary registrations in the Norwegian Central Securities Depository (Verdipapirsentralen). Holders of Second Lien Convertible Bonds are reminded that, as per the terms and conditions of the Second Lien Convertible Bonds, those bonds can only be converted on an Interest Payment Date (as defined in the Second Lien Convertible Bond Agreement), the next Interest Payment Date being 15 January 2014; no action may be taken by any Second Lien Convertible Bondholder to convert their bonds before that time. About Northland Headquartered in Luxembourg, Northland Resources S.A. is a producer of iron ore concentrate, with a portfolio of production, development and exploration mines and projects in northern Sweden and Finland. The first construction phase of the Kaunisvaara project is complete and production ramp-up started in November 2012. The Company expects to produce high-grade, high-quality magnetite iron concentrate in Kaunisvaara, Sweden, where the Company expects to exploit two magnetite iron ore deposits, Tapuli and Sahavaara. Northland has entered into off-take contracts with three partners for the entire production from the Kaunisvaara project over the next seven to ten years. The Company is also preparing a Definitive Feasibility Study for its Hannukainen Iron Oxide Copper Gold project in Kolari, northern Finland and for the Pellivuoma deposit, which is located 15 km from the Kaunisvaara processing plant. As reported by the Troubled Company Reporter on July 15, 2013, Peter Pernlof, Acting CEO and COO of Northland Resources S.A., disclosed that the Lulea District Court approved on July 12 the reorganization plan for the Company's Swedish subsidiaries. As previously disclosed, the Lulea District Court held composition proceedings on July 12 in connection with the reorganization of companies Northland Resources AB (publ), Northland Sweden AB and Northland Logistics AB. During the proceedings the companies' creditors approved the terms of the proposed composition. The District Court held in accordance with this and approved the reorganization plan and composition. Norwegian subsidiary Northland Logistics AS is not going through formal reorganization, but has previously agreed with all of its creditors on a payment plan identical to that of the other subsidiaries. * * * As reported by the Troubled Company Reporter-Europe on April 1, 2013, Moody's Investors Service affirmed the Caa3 corporate family rating and bond rating of Northland Resources AB. Concurrently, Moody's has applied the 'limited default' ('/LD') indicator to the company's Ca-PD probability of default rating (PDR), to reflect the recently missed interest payment on its outstanding notes, which the rating agency considers a default according to its definition of default. As a result, Moody's PDR for Northland has been affirmed at Ca-PD/LD. In addition, the outlook on all ratings remains negative. OCEAN 4660: Barreca Denied as CRO; Management Deal Disapproved -------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Florida denied approval of (i) the chief restructuring officer agreement with Rick Barreca; and (ii) the management agreement between Ocean 4660, LLC and RKJ Hotel Management, LLC. According to the order, with the July 10, 2013, appointment of a Chapter 11 trustee, Mr. Barreca on behalf of himself and RKJ is required to: (a) the turn over all records and property of the estate under Mr. Barreca's and RKJ's custody and control to the Chapter 11 trustee; and (b) coordinate for an onsite manager to perform a walk through of the premises with the trustee. As reported in the Troubled Company Reporter on June 7, 2013, RKJ agreed to provide restructuring advisory services, including providing Mr. Barreca to serve as CRO of the Debtor. RKJ would also provide the services of Jeff Katofsky as chief financial officer to the Debtor. Mr. Barreca and Mr. Katofsky would lead the Debtor in evaluating and implementing strategic and tactical options through the restructuring process. The management agreement provides RKJ, as manager, would be compensated through (i) a base management fee equal to 5% of gross revenues of the Debtor's Hotel and (ii) a base asset management fee equal to 3% of the gross revenues of the hotel. The Agreement was to expire in 10 years. All proceeds of the Debtor's operations would be deposited into debtor-in-possession accounts as required by the United States Trustee, subject to all applicable reporting and other requirements. The $60,000 retainer called for in the management agreement was waived for the benefit of the estate. The Town of Lauderdale-by-the-Sea and Comerica Bank objected. Meanwhile, the U.S. Trustee for Region 21 notified the Bankruptcy Court that until further notice, it will not appoint a committee of creditors pursuant to Section 1102 of the Bankruptcy Code. About Ocean 4660 Ocean 4660, LLC, owner of a beachfront property operated as the Lauderdale Beachside Hotel in Lauderdale-by-the-Sea, Florida, filed a Chapter 11 petition (Bankr. S.D. Fla. Case No. 13-23165) in its hometown on June 2, 2013. Rick Barreca signed the petition as chief restructuring officer. The Lauderdale Beachside Hotel features a beach-front location, two five-story interior corridor buildings (east and west), 147 guest rooms, a beach front tiki bar and grill, a large adjoining restaurant and commercial kitchen space and on-site parking. The restaurant space and the tiki bar and grill are unoccupied. The occupancy rates have generally been between 40 percent and 70 percent occupancy. Room rates are $40 to $80 per night. The Company disclosed $15,762,871 in assets and $16,587,678 in liabilities as of the Chapter 11 filing. Judge John K. Olson presides over the case. The Debtor tapped RKJ Hotel Management, LLC, to serve as hotel manager and RKJ's Rick Barreca as CRO. The Court approved the appointment of Maria Yip, of Coral Gables, Florida, as Chapter 11 trustee. Drew M. Dillworth, Esq., of the Law firm of Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A. serves as his counsel. Kerry-Ann Rin, CPA, and the consulting firm of Yip Associates serve as financial advisor, and accountant. OCEAN 4660: Genovese Joblove May Withdraw as Attorney ----------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Florida authorized Genovese Joblove & Battista, P.A. to withdraw as counsel for Ocean 4660, LLC. The firm's legal team who worked on the Debtor's case consists of John H. Genovese, Esq., Maria Elena Gayo-Guitian, Esq., and Michael L. Schuster, Esq. In its motion to withdraw as counsel, the firm explained that irreconcilable differences have arisen between the firm and the Debtor, which prevent the firm from continuing its representation of the Debtor. About Ocean 4660 Ocean 4660, LLC, owner of a beachfront property operated as the Lauderdale Beachside Hotel in Lauderdale-by-the-Sea, Florida, filed a Chapter 11 petition (Bankr. S.D. Fla. Case No. 13-23165) in its hometown on June 2, 2013. Rick Barreca signed the petition as chief restructuring officer. The Lauderdale Beachside Hotel features a beach-front location, two five-story interior corridor buildings (east and west), 147 guest rooms, a beach front tiki bar and grill, a large adjoining restaurant and commercial kitchen space and on-site parking. The restaurant space and the tiki bar and grill are unoccupied. The occupancy rates have generally been between 40 percent and 70 percent occupancy. Room rates are $40 to $80 per night. The Company disclosed $15,762,871 in assets and $16,587,678 in liabilities as of the Chapter 11 filing. Judge John K. Olson presides over the case. The Debtor tapped RKJ Hotel Management, LLC, as hotel manager and RKJ's Rick Barreca as the CRO. The Court approved the appointment of Maria Yip, of Coral Gables, Florida, as Chapter 11 trustee. Drew M. Dillworth, Esq., of the Law firm of Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A. serves as his counsel. Kerry-Ann Rin, CPA, and the consulting firm of Yip Associates serve as financial advisor, and accountant. The U.S. Trustee has not appointed an official committee of unsecured creditors. OCEAN 4660: Ch.11 Trustee May Hire Stearns Weaver & Kerry-Ann Rin ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Florida authorized Maria M. Yip, Chapter 11 trustee for Ocean 4660 LLC, to employ Kerry-Ann Rin, CPA, and the consulting firm of Yip Associates as financial advisors, forensic accountant, and if necessary, as testifying expert of the trustee. The Chapter 11 trustee requires the assistance of an expert to review and analyze the various book and records associated with the financial affairs. To the best of the Chapter 11 trustee's knowledge, the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. Kerry-Ann Rin, CPA and Yip Associates will assist the Chapter 11 trustee in reviewing and analyzing the various books and records associated with the Debtor's financial affairs. Kerry-Ann Rin, CPA, disclosed that Yip Associates has been retained by the Chapter 11 trustee in other unrelated bankruptcy matters. In a separate ruling, the Court authorized the Chapter 11 trustee to employ Drew M. Dillworth, Esq., of the law firm of Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A. as counsel. To the best of the trustee's knowledge, the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Ocean 4660 Ocean 4660, LLC, owner of a beachfront property operated as the Lauderdale Beachside Hotel in Lauderdale-by-the-Sea, Florida, filed a Chapter 11 petition (Bankr. S.D. Fla. Case No. 13-23165) in its hometown on June 2, 2013. Rick Barreca signed the petition as chief restructuring officer. The Lauderdale Beachside Hotel features a beach-front location, two five-story interior corridor buildings (east and west), 147 guest rooms, a beach front tiki bar and grill, a large adjoining restaurant and commercial kitchen space and on-site parking. The restaurant space and the tiki bar and grill are unoccupied. The occupancy rates have generally been between 40 percent and 70 percent occupancy. Room rates are $40 to $80 per night. The Company disclosed $15,762,871 in assets and $16,587,678 in liabilities as of the Chapter 11 filing. Judge John K. Olson presides over the case. The Debtor tapped RKJ Hotel Management, LLC, as hotel manager and RKJ's Rick Barreca as the CRO. The Debtor tapped Genovese Joblove & Battista, P.A. as counsel. Irreconcilable differences prompted the firm to withdraw as counsel in July 2013. The Court approved the appointment of Maria Yip, of Coral Gables, Florida, as Chapter 11 trustee. Drew M. Dillworth, Esq., of the Law firm of Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A. serves as his counsel. Kerry-Ann Rin, CPA, and the consulting firm of Yip Associates serve as financial advisor, and accountant. The U.S. Trustee has not appointed an official committee of unsecured creditors. OCEAN 4660: Lloyd Berger Approved as Building Code Consultant ------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Florida authorized Maria M. Yip, Chapter 11 trustee for Ocean 4660 LLC, to employ Lloyd Berger as his consultant relating to building code violations and related compliance issues concerning the real estate assets owned by the estate. Lloyd Berger's scope of the engagement will include: a) site meetings with the City to review open code issues; b) identifying which issues can be immediately resolved with nominal expense; c) identifying issues not readily curable with a larger expense and receiving permission to follow through with these projects; d) obtaining required permits prior to work (if work is necessary); and e) providing documentation showing compliance of approved work. The consultant will be paid hourly rates ranging from $75 per hour for a property manager up to $200 per hour for services provided by Lloyd Berger. About Ocean 4660 Ocean 4660, LLC, owner of a beachfront property operated as the Lauderdale Beachside Hotel in Lauderdale-by-the-Sea, Florida, filed a Chapter 11 petition (Bankr. S.D. Fla. Case No. 13-23165) in its hometown on June 2, 2013. Rick Barreca signed the petition as chief restructuring officer. The Lauderdale Beachside Hotel features a beach-front location, two five-story interior corridor buildings (east and west), 147 guest rooms, a beach front tiki bar and grill, a large adjoining restaurant and commercial kitchen space and on-site parking. The restaurant space and the tiki bar and grill are unoccupied. The occupancy rates have generally been between 40 percent and 70 percent occupancy. Room rates are $40 to $80 per night. The Company disclosed $15,762,871 in assets and $16,587,678 in liabilities as of the Chapter 11 filing. Judge John K. Olson presides over the case. The Debtor tapped RKJ Hotel Management, LLC, as hotel manager and RKJ's Rick Barreca as the CRO. The Debtor tapped Genovese Joblove & Battista, P.A. as counsel. Irreconcilable differences prompted the firm to withdraw as counsel in July 2013. The Court approved the appointment of Maria Yip, of Coral Gables, Florida, as Chapter 11 trustee. Drew M. Dillworth, Esq., of the Law firm of Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A. serves as his counsel. Kerry-Ann Rin, CPA, and the consulting firm of Yip Associates serve as financial advisor, and accountant. The U.S. Trustee has not appointed an official committee of unsecured creditors. OCI BEAUMONT: Moody's Assigns B1 CFR & Rates New $360MM Loan B1 --------------------------------------------------------------- Moody's Investors Service assigned a B1 Corporate Family Rating to OCI Beaumont LLC. Moody's also rated its new $360 million first lien term loan B due 2019 at B1, a Probability of Default Rating at B2-PD and a Speculative Grade Liquidity rating at SGL-3. Proceeds from the transaction are expected to be used to refinance existing $125 term loan B-1 and $235 term loan B-2; the new term loan will have a similar structure. These are first time ratings for company and are dependent upon completion of the transaction with terms that are substantially similar to those provided to Moody's. The outlook is stable. "OCI has restarted the Terra's Beaumont facility and has been operating at close to nameplate capacity for the past seven months," stated John Rogers Senior Vice President at Moody's. "Credit metrics on a full year basis are expected to be strong, given our forecast for low natural gas prices and limited downside for methanol and ammonia prices." Ratings assigned: OCI Beaumont LLC Corporate Family Rating -- B1 Probability of Default Rating -- B2-PD $125 million First Lien Term Loan B-1 due 2019-- B1 (LGD, 31%) $235 million First Lien Term Loan B-2 due 2019-- B1 (LGD, 31%) Speculative Grade Liquidity Rating at SGL-3 Outlook -- Stable Ratings Rationale: OCI's B1 CFR reflects its advantaged feedstock cost position due to low natural gas prices in the US, strong financial metrics and limited leverage. The company's strong credit metrics are offset by its single site location on the Gulf Coast, its limited operating history, customer and supplier concentration, and its planned conversion to a limited partnership (LP) that will likely result in nearly all free cash flow being returned to unit holders on a quarterly basis. The combination of a single site location and the financial constraints imposed by the LP structure will likely limit the rating at its current level, despite the likely generation of strong financial metrics over the next several years. The company's location (proximity to customers and shipping options) and access to multiple natural gas pipelines are also viewed as credit positives. Subsequent to the issuance of this debt, the company is expected to complete the IPO of the partnership and repay the newly rated $125 million term loan B-1, repay a $170 million loan from an affiliate and retain roughly $150 million of cash to prefund the planned expansion of the facility. Despite this debt reduction, OCI will have the ability to re-lever its balance sheet to 1.25x Debt/EBITDA (unadjusted) under the terms of the facility. The B1 rating anticipates that the company will re-lever its balance sheet once it has established a longer operational track record. Once the IPO has been completed, the CFR will be moved to the LP, OCI Partners LP. OCI has limited operating history: the facility was acquired in May 2011 (previously idled in 2004), ammonia production started in December 2011, methanol production started in July 2012 and the company achieved nameplate capacity in December 2012. The company has experienced numerous shut-downs over the past year to fix or replace key components or pieces of equipment, as expected in such a restart. These shut downs have continued into 2013, which is not unusual. However, the company has been able to operate at over 95% capacity utilization for the first six month of 2013. The expansion should boost methanol production by 25% and ammonia production by 15%. Moody's does not view the capacity expansion as optional, as the company will be replacing equipment that will improve the reliability of the facility. The company sells most of its production via pipeline or barge, accounting for the high level of customer concentration. OCI's financial performance and credit metrics should be robust (assumes $360 million of balance sheet debt) due to its advantaged feedstock, providing it maintains capacity utilization rates of over 80%. While the company has only operated near capacity for the past seven months, pro forma credit metrics are strong with EBITDA margins above 40% and Debt/EBITDA at 2.1x. If the company is able to operate near nameplate capacity, credit metrics should improve with Debt/EBITDA closer to 1.0x. Once the IPO of the partnership is completed, its Retained Cash Flow/Debt and Free Cash Flow/Debt will be commensurate with the rating due to the large dividend payout under the LP structure. If the company fails to complete the IPO as planned, debt would be higher at over $530 million ($170 million of debt owed to and affiliate, OCI Fertilizer) causing pro forma Debt/EBITDA to rise to 3.0x. However, cash flow metrics would improve substantially due to the absence of the more aggressive dividend policy. Prior to the closing, OCI is required to extend the August 2014 maturity of $170 million loan from OCI Fertilizer to at least 91 days after the final maturity of the rated term loan. The stable outlook reflects the expectation for strong financial metrics, but the single site production could lead to volatility in quarterly performance. If the facility incurs persistent operational issues that limit production to less than 80% of capacity for an extended period, or if leverage rises above 4.0x, Moody's could lower the company's CFR. As stated previously, the rating has limited upside due to its limited operating history, single production site and the limitations of the LP structure. OCI's SGL-3 reflects its adequate liquidity due to a relatively small revolver and the reduced financial flexibility imposed by the LP structure. The $40 million revolving credit facility will be provided by the ultimate parent of the general partner and majority owner of the LP units - OCI N.V. The company will maintain a small cash balance and will not repay any debt beyond scheduled amortizations, once the IPO is completed and the $125 million term loan B-1 is repaid. The term loan is expected to have a maximum total senior secured net leverage ratio of 2.0x and minimum interest coverage ratio of 5.0x. The company is expected to remain well in compliance with these covenants over the next 12-18 months, barring an extended unplanned outage. OCI N.V. is a global engineering & construction contractor and nitrogen fertilizer producer based in the Netherlands. OCI N.V. was formerly known as Orascom Construction Industries S.A.E. (Egypt). OCI N.V. operates nitrogen fertilizer plants in Egypt, Algeria, The Netherlands and the US. It is also a distributor of fertilizers globally. OCI N.V. is listed on the NYSE Euronext in Amsterdam and has a market capitalization of roughly $7.7 billion as of August 1, 2013. OCI Beaumont LLC, headquartered in Beaumont, TX, operates a single Gulf Coast petrochemical facility that produces 730 thousand tons per year of methanol and 236 thousand tons per year of ammonia. The company expects to expand capacity to 913 thousand tons per year of methanol and 305 thousand tons per year of ammonia by the end of 2014. The company is expected to have annual revenues of roughly $400 million. The principal methodology used in this rating was the Global Chemical Industry Methodology published in December 2009. Other methodologies used include Loss Given Default for Speculative- Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. OIL PATCH: Has Access to FCC and SOPUS Cash Until Aug. 30 --------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Texas authorized, in an amended second interim order, Oil Patch Brazos Valley, Inc.'s cash collateral which FCC LLC, doing business as First Capital, and Pennzoil-Quaker State Company dba SOPUS assert an interest. Pursuant to the stipulation resolving objections filed by SOPUS and FCC, SOPUS and FCC consented to the Debtor's use of cash collateral until Aug. 30, 2013. The Debtor would use the cash collateral for (i) severance payments to certain employees while the debtor is reducing its overhead and workforce; (ii) salary to be paid to the Debtor's chief operating officer, who previously has not been paid for his services; and (iii) payment of retention payments to the Debtor's employees. FCC holds a first priority secured claim against the Debtor in the amount of at least $7,212,302 plus additional amounts. SOPUS holds, as of the petition date, a claim in the amount of $512,939 plus additional amounts. As adequate protection from any diminution in value of the lenders' collateral, the Debtor will grant the lenders liens on all properties, and superpriority administrative claim status, subject to a carve-out for certain expenses. The Debtor will also segregate and account to FCC and SOPUS for all cash collateral that the Debtor collects, possesses or uses from the petition Date that it has permitted. An Aug. 28 final hearing at 9:30 a.m., has been set. Objections, if any, are due five business days before the final hearing. About Oil Patch Angleton, Texas-based Oil Patch Brazos Valley, Inc., sought protection under Chapter 11 of the Bankruptcy Code on July 2, 2013. The case, assigned Case No. 13-34177, is pending before the U.S. Bankruptcy Court Southern District of Texas (Houston). Judge Jeff Bohm presides over the case. Matthew Scott Okin, Esq., at Okin & Adams LLP, in Houston, Texas, represents the Debtor as counsel. The Debtor tapped James Childs, LLC as financial advisor. The Debtor disclosed $16,887,969 in assets and $15,313,489 in liabilities as of the Chapter 11 filing. The petition was signed by Wright Gore, III, chief operating officer. No trustee or creditors committee has been appointed in the case. OIL PATCH: Files Schedules of Assets and Liabilities ---------------------------------------------------- Oil Patch Brazos Valley, Inc., filed with the U.S. Bankruptcy Court for the Southern District of Texas its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $3,022,650 B. Personal Property $13,865,319 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $11,497,469 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $3,816,020 ----------- ----------- TOTAL $16,887,969 $15,313,489 A copy of the schedules is available for free at http://bankrupt.com/misc/OIL_PATCH_sal.pdf About Oil Patch Angleton, Texas-based Oil Patch Brazos Valley, Inc., was formed in 1988. The Company's business consists primarily of the distribution and transportation of fuel, including both gasoline and diesel products, well as Shell and other branded lubricants to businesses throughout Brazoria County and the surrounding area. The Debtor markets and distributes automotive consumables as oil and air fuel additives and wiper blades, as well as fuel and lubricant dispensing equipment, solvents, environmental clean-up materials, shop supplies and third-party waste oil collection services. The Company sought protection under Chapter 11 of the Bankruptcy Code on July 2, 2013. The case, assigned Case No. 13-34177, is pending before the U.S. Bankruptcy Court Southern District of Texas (Houston). Judge Jeff Bohm presides over the case. Matthew Scott Okin, Esq., at Okin & Adams LLP, in Houston, Texas, represents the Debtor as counsel. The Debtor tapped James Childs, LLC as financial advisor. The Debtor disclosed $16,887,969 in assets and $15,313,489 in liabilities as of the Chapter 11 filing. The petition was signed by Wright Gore, III, chief operating officer. No trustee or creditors committee has been appointed in the case. OIL PATCH: Wants to Hire James Childs as Financial Advisor ---------------------------------------------------------- Oil Patch Brazos Valley, Inc., asks the U.S. Bankruptcy Court for the Southern District of Texas for permission to employ James Childs, LLC as financial advisor to, among other things, assist the Debtor: -- with credit descriptions; -- in evaluating proposals for financing; -- with negotiating and communicating with potential lenders; and -- with closing of the DIP financing. Childs was paid a $5,000 retainer, which was paid not by the Debtor but by the Debtor's primary equity owners. Childs' compensation will be contingent upon its meeting the goals for which it will be hired. That is, Childs will be compensated a pre-determined amount as it achieves each of four specified goals: 1. $5,000 upon the completion of a detailed credit request for distribution; 2. $5,000 upon the Debtor's receipt of its first term sheet/proposal with certain specified "acceptable" minimum requirements; 3. $40,000 at the closing of the DIP financing; and 4. an additional $50,000 at the closing of the DIP financing if the Stated Annual Interest Rate for such financing is at the Libor/Prime Goal or less. To the best of the Debtor's knowledge, Childs is "disinterested persons," as that term is defined in Section 101(14) of the Bankruptcy Code. About Oil Patch Angleton, Texas-based Oil Patch Brazos Valley, Inc., was formed in 1988. The Company's business consists primarily of the distribution and transportation of fuel, including both gasoline and diesel products, well as Shell and other branded lubricants to businesses throughout Brazoria County and the surrounding area. The Debtor markets and distributes automotive consumables as oil and air fuel additives and wiper blades, as well as fuel and lubricant dispensing equipment, solvents, environmental clean-up materials, shop supplies and third-party waste oil collection services. The Company sought protection under Chapter 11 of the Bankruptcy Code on July 2, 2013. The case, assigned Case No. 13-34177, is pending before the U.S. Bankruptcy Court Southern District of Texas (Houston). Judge Jeff Bohm presides over the case. Matthew Scott Okin, Esq., at Okin & Adams LLP, in Houston, Texas, represents the Debtor as counsel. The Debtor tapped James Childs, LLC as financial advisor. The Debtor disclosed $16,887,969 in assets and $15,313,489 in liabilities as of the Chapter 11 filing. The petition was signed by Wright Gore, III, chief operating officer. No trustee or creditors committee has been appointed in the case. OIL PATCH: Hiring Okin & Adams as Bankruptcy Counsel ---------------------------------------------------- Oil Patch Brazos Valley, Inc. asks the U.S. Bankruptcy Court for the Southern District of Texas for permission to employ Okin & Adams LLP as counsel. To the best of the Debtor's knowledge, Okin & Adams is a "disinterested person" as that term is defined in Section 101(14) of the bankruptcy Code. Pre-bankruptcy, Okin & Adams received a $35,000 retainer from the Debtor. Okin Adams also received an additional retainer of $35,000 from the Debtor's primary equity owners. After application of fees and expenses, the retainer is $63,494. About Oil Patch Angleton, Texas-based Oil Patch Brazos Valley, Inc., was formed in 1988. The Company's business consists primarily of the distribution and transportation of fuel, including both gasoline and diesel products, well as Shell and other branded lubricants to businesses throughout Brazoria County and the surrounding area. The Debtor markets and distributes automotive consumables as oil and air fuel additives and wiper blades, as well as fuel and lubricant dispensing equipment, solvents, environmental clean-up materials, shop supplies and third-party waste oil collection services. The Company sought protection under Chapter 11 of the Bankruptcy Code on July 2, 2013. The case, assigned Case No. 13-34177, is pending before the U.S. Bankruptcy Court Southern District of Texas (Houston). Judge Jeff Bohm presides over the case. Matthew Scott Okin, Esq., at Okin & Adams LLP, in Houston, Texas, represents the Debtor as counsel. The Debtor tapped James Childs, LLC as financial advisor. The Debtor disclosed $16,887,969 in assets and $15,313,489 in liabilities as of the Chapter 11 filing. The petition was signed by Wright Gore, III, chief operating officer. No trustee or creditors committee has been appointed in the case. OP-TECH ENVIRONMENTAL: Now a Wholly-Owned Subsidiary of NRC ----------------------------------------------------------- The parent company of National Response Corporation has successfully completed its tender offer for all outstanding shares of common stock of OP-TECH Environmental Services, Inc. The tender offer expired at 5:00 p.m., New York City time, on Monday, July 29, 2013. As of the expiration of the tender offer, 56,904,875 shares of OP-TECH's common stock had been validly tendered and not withdrawn (not including 250,000 shares tendered pursuant to the guaranteed delivery procedures provided for in the offer), which represents approximately 96.1 percent of the outstanding shares of OP-TECH common stock. All shares of OP-TECH common stock that were validly tendered and not withdrawn immediately prior to the expiration of the offer have been accepted for payment. The aggregate purchase price to acquire all outstanding shares of common stock and equity interests of the Company was approximately $6.9 million. Steve Candito, CEO of NRC, commented, "We are pleased to welcome OP-TECH to the NRC family. OP-TECH is a great fit strategically to both expand NRC's service offerings and geographic reach. OP- TECH compliments NRC's existing West Coast operations and has similar strengths including a loyal customer base, quality employees, responsive services, and a unique market position. We look forward to working closely with OP-TECH's management team to grow the combined organization." Charles Morgan, CEO of OP-TECH, stated, "We are excited about combining OP-TECH with NRC. OP-TECH's knowledgeable and professional staff, quality reputation, and loyal client base are consistent with NRC's history of providing its customers with superior services in diverse geographies. On behalf of the entire OP-TECH team, we look forward to working with NRC to grow the combined business and expand our service offerings." NRC was acquired in March 2012 by investment affiliates of J.F. Lehman & Company, a leading middle-market private equity firm focused on the defense, aerospace, and maritime sectors. "NRC continues to execute its strategy of expanding its service offerings in environmental, industrial, and emergency response services both domestically and abroad," said Alex Harman, partner. "OP-TECH demonstrates many of the qualities J.F. Lehman & Company seeks in acquisition candidates and we are excited to have them as a part of NRC." NRC completed the acquisition process by effecting a short-form merger pursuant to Delaware law without a vote or meeting of OP-TECH's remaining stockholders. The merger was consummated later July 30, 2013. Senior debt financing for the acquisition was arranged by BNP Paribas Securities Corp. (as sole lead arranger). Jones Day provided legal counsel to NRC. In connection with the completion of the Merger, the Company has informed the Financial Industry Regulatory Authority, Inc., of the Merger and requested that trading in its share of Common Stock be suspended and that the Common Stock be withdrawn from quotation on the OTC Markets Group, Inc. The Company filed with the Securities and Exchange Commission a Form 15 under the Securities Exchange Act of 1934, as amended, which would terminate and suspend the Company's reporting obligations under Section 13 and 15(d) of the Exchange Act. A copy of the amended Schedule TO is available for free at: http://is.gd/PnQ4on In an amended Schedule 13D filing with the the U.S. Securities and Exchange Commission, NRC US Holding Company, LLC, and its affiliates disclosed that as of July 30, 2013, they beneficially owned 100 shares of common stock of OP-TECH Environmental Services, Inc., representing 100 percent of the shares outstanding. A copy of the amended filing is available at: http://is.gd/sjiDg3 Additional information about the transaction is available at: http://is.gd/EebWOg About OP-TECh Environmental East Syracuse, N.Y.-based OP-TECH Environmental Services, Inc., provides comprehensive environmental and industrial cleaning and decontamination services predominately in New York, New England, Pennsylvania, New Jersey, and Ohio. Dannible & McKee, LLP, in their audit report, dated May 14, 2013, for the fiscal year ended Dec. 31, 2012, expressed substantial doubt about OP-TECH Environmental's ability to continue as a going concern. The independent auditors noted that the Company has negative working capital and a stockholders' deficit at Dec. 31, 2012, and caused violations of the Company's financing agreements. The Company reported net income of $1.0 million on $32.3 million of revenues in 2012, compared with a net loss of $7.5 million on $30.7 million of revenues in 2011. The Company's balance sheet at March 31, 2013, showed $8.99 million in total assets, $12.79 million in total liabilities and a $3.79 million shareholders' deficit. ORCHARD SUPPLY: Slams U.S. Trustee Opposition to $3MM Bonus Plan ---------------------------------------------------------------- Law360 reported that Orchard Supply Hardware Stores Corp. blasted opposition to a bonus plan that could pay top brass of the bankrupt home-and-garden chain more than $3 million for landing a buyer, claiming the U.S. trustee is judging the deal with misplaced hindsight. According to the report, U.S. Trustee Roberta A. DeAngelis objected to Orchard's key employee incentive plan, saying it provides executives no actual incentive because the $200 million bonus threshold had already been triggered on the petition date by the retailer's $205 million stalking horse agreement with Lowe's Home Improvement LLC. Excessive Bonuses Peg Brickley, writing for Dow Jones Business News, reported that federal bankruptcy monitors say Orchard Supply Hardware Corp.'s top leaders are in line for bonuses that are "quite large, and excessive" for executives of a troubled chain being auctioned off in bankruptcy. According to the Dow Jones report, Orchard's bonus proposal could mean a pool of more than $3 million to be shared among five senior executives, with 40% of the pool earmarked for Chief Executive Mark Baker, court papers say. Mr. Chesley noted there were no objections from anyone with an economic stake in the outcome of Orchard's bankruptcy, the report said. The size of the executive bonus pool depends on the price Orchard fetches at auction or on how much lenders recover if the company switches course and opts for a restructuring instead of a sale, the report related. 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. Orchard Supply and two affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-11565) on June 16 to facilitate a restructuring of the company's balance sheet and a sale of its assets for $205 million in cash to Lowe's Companies, Inc., absent higher and better offers. In addition to the $205 million cash, Lowe's has agreed to assume payables owed to nearly all of Orchard's supplier partners. Bankruptcy Judge Christopher S. Sontchi oversees the case. Michael W. Fox signed the petitions as senior vice president and general counsel. The Debtors disclosed total assets of $441,028,000 and total debts of $480,144,000. Stuart M. Brown, Esq., at DLA Piper LLP (US), in Wilmington, Delaware; and Richard A. Chesley, Esq., Chun I. Jang, Esq., and Daniel M. Simon, Esq., at DLA Piper LLP (US), in Chicago, Illinois, are the Debtors' counsel. Moelis & Company LLC serves as the Debtors' investment banker. FTI Consulting, Inc., serves as the Debtors' financial advisors. A&G Realty Partners, LLC, serves as the Debtors' real estate advisors. BMC Group Inc. is the Debtors' claims and noticing agent. ORCHARD SUPPLY: Has Final Approval of $176.3MM DIP Loan Packages ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware gave Orchard Supply Hardware Stores Corporation, et al., final authority to obtain postpetition financing totaling $176.3 million. The DIP Loans are composed of the following: -- $147,125,000 senior secured superpriority revolving credit facility and $17,208,187 senior secured superpriority term loan facility from Wells Fargo Bank, National Association, as sole administrative agent and collateral agent for the DIP Lenders; and -- $12,000,000 secured superpriority delayed draw term loan credit facility from Gleacher Products Corp., as sole administrative agent and collateral agent for the the Term Lender DIP Lenders. Proceeds from the DIP Facilities will be used to pay fees, expenses and costs incurred in connection with the Chapter 11 cases, to repay the outstanding balance in the Debtors' prepetition indebtedness, and to pay working capital and capital expenditures. The ABL DIP Secured Parties are granted priming first priority, continuing, valid, binding, enforceable, non-avoidable and automatically perfected postpetition security interests and liens in all of the assets and property of the Debtors; provided that the DIP Collateral will not include bankruptcy recoveries, any other property to the extent that any requirement of law of a governmental authority prohibits the creation of a security interest herein, and the Debtors' cases of action against insiders. The ABL DIP Liens are subject to the carve-out and priority liens. All ABL DIP Obligations will be an allowed superpriority administrative expense claim. The Carve-Out includes allowed administrative expenses for fees to be paid to the Clerk of the Bankruptcy Court and to the U.S. Trustee, fees and costs incurred by professionals of the Debtors and the Official Committee of Unsecured Creditors. All ABL DIP Obligations will be immediately due and payable on the date that is the earliest to occur of (i) Dec. 16, 2013, (ii) 10 days after the entry of an order authorizing the sale of all of the Debtors' assets; (iii) 14 days following the entry of an order confirming a Plan; (iv) the consummation date; and (v) the date of termination of the Aggregate Revolving Commitments and acceleration of any outstanding obligations in accordance with the ABL DIP Credit Agreement. A full-text copy of the Final Order approving the Wells Fargo DIP Loans is available for free at: http://bankrupt.com/misc/ORCHARDdiploan0719.pdf A full-text copy of the Final Order approving the Gleacher DIP Loan is available for free at: http://bankrupt.com/misc/ORCHARDdiptermloan0719.pdf 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. Orchard Supply and two affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-11565) on June 16 to facilitate a restructuring of the company's balance sheet and a sale of its assets for $205 million in cash to Lowe's Companies, Inc., absent higher and better offers. In addition to the $205 million cash, Lowe's has agreed to assume payables owed to nearly all of Orchard's supplier partners. Bankruptcy Judge Christopher S. Sontchi oversees the case. Michael W. Fox signed the petitions as senior vice president and general counsel. The Debtors disclosed total assets of $441,028,000 and total debts of $480,144,000. Stuart M. Brown, Esq., at DLA Piper LLP (US), in Wilmington, Delaware; and Richard A. Chesley, Esq., Chun I. Jang, Esq., and Daniel M. Simon, Esq., at DLA Piper LLP (US), in Chicago, Illinois, are the Debtors' counsel. Moelis & Company LLC serves as the Debtors' investment banker. FTI Consulting, Inc., serves as the Debtors' financial advisors. A&G Realty Partners, LLC, serves as the Debtors' real estate advisors. BMC Group Inc. is the Debtors' claims and noticing agent. ORCHARD SUPPLY: Has Final Authority to Use Cash Collateral ---------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware gave Orchard Supply Hardware Stores Corporation, et al., final authority to use "cash collateral" securing their prepetition indebtedness from the prepetition ABL Secured Parties. The Prepetition ABL Secured Parties are entitled to receive adequate protection for any decrease in the value of their interests in the Collateral and the Debtors' use, sale or lease of the Collateral. As adequate protection, the Prepetition ABL Secured Parties will have additional and replacement security interests and liens in the ABL DIP Collateral, which will be junior only to the ABL DIP Liens, the ABL DIP Superpriority Claim, and the Carve Out. The Prepetition ABL Secured Parties will have an allowed superpriority administrative expense claim. The Debtors will also establish an account in the control of the Prepetition ABL Agent into which $250,000 will be deposited as security for any reimbursement, indemnification or similar continuing obligations of the Debtors in favor of the Prepetition ABL Secured Parties. The Carve-Out includes allowed administrative expenses for fees to be paid to the Clerk of the Bankruptcy Court and to the U.S. Trustee, fees and costs incurred by professionals of the Debtors and the Official Committee of Unsecured Creditors. The Debtors' authority to use Cash Collateral will cease on the date that is the earliest to occur of (i) Dec. 16, 2013, (ii) 10 days after the entry of an order authorizing the sale of all of the Debtors' assets; (iii) 14 days following the entry of an order confirming a Plan; (iv) the consummation date; and (v) the date of termination of the Aggregate Revolving Commitments and acceleration of any outstanding obligations in accordance with the ABL DIP Credit Agreement. 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. Orchard Supply and two affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-11565) on June 16 to facilitate a restructuring of the company's balance sheet and a sale of its assets for $205 million in cash to Lowe's Companies, Inc., absent higher and better offers. In addition to the $205 million cash, Lowe's has agreed to assume payables owed to nearly all of Orchard's supplier partners. Bankruptcy Judge Christopher S. Sontchi oversees the case. Michael W. Fox signed the petitions as senior vice president and general counsel. The Debtors disclosed total assets of $441,028,000 and total debts of $480,144,000. Stuart M. Brown, Esq., at DLA Piper LLP (US), in Wilmington, Delaware; and Richard A. Chesley, Esq., Chun I. Jang, Esq., and Daniel M. Simon, Esq., at DLA Piper LLP (US), in Chicago, Illinois, are the Debtors' counsel. Moelis & Company LLC serves as the Debtors' investment banker. FTI Consulting, Inc., serves as the Debtors' financial advisors. A&G Realty Partners, LLC, serves as the Debtors' real estate advisors. BMC Group Inc. is the Debtors' claims and noticing agent. ORCHARD SUPPLY: Committee Seeks to Retain Pachulski as Counsel -------------------------------------------------------------- The Official Committee of Unsecured Creditors appointed in the Chapter 11 cases of Orchard Supply Hardware Stores Corporation, et al., seeks authority from the U.S. Bankruptcy Court for the District of Delaware to retain Pachulski Stang Ziehl & Jones LLP as counsel. The professionals and paralegals presently designate to represent the Committee and their current standard hourly rates are: Bradford J. Sandler, Esq. bsandler@pszjlaw.com $750 John Fiero, Esq. jfiero@pszjlaw.com $745 James E. O'Neill, Esq. joneill@pszjlaw.com $695 Karina Yee $295 Mr. Sandler, a partner at Pachulski Stang Ziehl & Jones LLP, 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 from the Committee's. A hearing on the retention application will be on Aug. 6, 2013, at 10:00 a.m. EST. Objections are due July 30. 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. Orchard Supply and two affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-11565) on June 16 to facilitate a restructuring of the company's balance sheet and a sale of its assets for $205 million in cash to Lowe's Companies, Inc., absent higher and better offers. In addition to the $205 million cash, Lowe's has agreed to assume payables owed to nearly all of Orchard's supplier partners. Bankruptcy Judge Christopher S. Sontchi oversees the case. Michael W. Fox signed the petitions as senior vice president and general counsel. The Debtors disclosed total assets of $441,028,000 and total debts of $480,144,000. Stuart M. Brown, Esq., at DLA Piper LLP (US), in Wilmington, Delaware; and Richard A. Chesley, Esq., Chun I. Jang, Esq., and Daniel M. Simon, Esq., at DLA Piper LLP (US), in Chicago, Illinois, are the Debtors' counsel. Moelis & Company LLC serves as the Debtors' investment banker. FTI Consulting, Inc., serves as the Debtors' financial advisors. A&G Realty Partners, LLC, serves as the Debtors' real estate advisors. BMC Group Inc. is the Debtors' claims and noticing agent. ORCHARD SUPPLY: Committee Taps Alvarez & Marsal as Fin'l Advisors ----------------------------------------------------------------- The Official Committee of Unsecured Creditors appointed in the Chapter 11 cases of Orchard Supply Hardware Stores Corporation, et al., seeks authority from the U.S. Bankruptcy Court for the District of Delaware to retain Alvarez & Marsal North America, LLC, as financial advisors, to be paid the following hourly rates: Managing directors $625-$850 Directors $475-$625 Associates $350-$475 Analysts $225-$350 Kelly B. Stapleton, a managing director of Alvarez & Marsal, 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 Committee's. Ms. Stapleton, however, discloses that she was the U.S. Trustee for Region 3 from January 2005 through May 2008 although A&M does not have any connection to the employees within the U.S. Trustee's office in the District of Delaware. A hearing on the retention application will be on Aug. 6, 2013, at 10:00 a.m. EST. Objections are due July 30. 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. Orchard Supply and two affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-11565) on June 16 to facilitate a restructuring of the company's balance sheet and a sale of its assets for $205 million in cash to Lowe's Companies, Inc., absent higher and better offers. In addition to the $205 million cash, Lowe's has agreed to assume payables owed to nearly all of Orchard's supplier partners. Bankruptcy Judge Christopher S. Sontchi oversees the case. Michael W. Fox signed the petitions as senior vice president and general counsel. The Debtors disclosed total assets of $441,028,000 and total debts of $480,144,000. Stuart M. Brown, Esq., at DLA Piper LLP (US), in Wilmington, Delaware; and Richard A. Chesley, Esq., Chun I. Jang, Esq., and Daniel M. Simon, Esq., at DLA Piper LLP (US), in Chicago, Illinois, are the Debtors' counsel. Moelis & Company LLC serves as the Debtors' investment banker. FTI Consulting, Inc., serves as the Debtors' financial advisors. A&G Realty Partners, LLC, serves as the Debtors' real estate advisors. BMC Group Inc. is the Debtors' claims and noticing agent. ORCKIT COMMUNICATIONS: Arrangement with Noteholders Approved ------------------------------------------------------------ At the extraordinary general meeting of shareholders of Orckit Communications Ltd. held on July 31, 2013, the shareholders approved: (1) an arrangement between the Company and its Series A note holders and Series B note holders and related matters, including an amendment to the Company's articles of association; and (2) approved a compensation policy for directors and officers, in accordance with the requirements of the Israeli Companies Law. The Arrangement is subject to the satisfaction of the following material conditions: * the approval of the Tel Aviv Stock Exchange * a tax ruling from the Israeli Tax Authority * the approval of the District Court of Tel Aviv * the closing of the patent sale and investment transaction with Networks Inc. The transaction with Networks is subject to the satisfaction of the following material conditions, on or prior to Aug. 15, 2013: * the closing of the Arrangement * the approval of the Tel Aviv Stock Exchange of the listing of the Orckit shares to be issued to Networks * the approval of the Israeli Office of the Chief Scientist on terms satisfactory to Networks The Company said there can be no assurance that all the conditions will be timely satisfied or that the foregoing transactions will be consummated. About Orckit Tel-Aviv, Israel-based Orckit Communications Ltd. (TASE: ORCT) engages in the design, development, manufacture and marketing of advanced telecom equipment to telecommunication service providers in metropolitan areas. The Company's products are transport telecommunication equipment targeting high capacity packetized metropolitan networks. ORCKIT Communications disclosed a net loss of $6.46 million on $11.19 million of revenues for the year ended Dec. 31, 2012, as compared with a net loss of $17.38 million on $15.58 million of revenues for the year ended Dec. 31, 2011. The Company's balance sheet at March 31, 2013, showed US$14.93 million in total assets, US$25.28 million in total liabilities and a US$10.35 million total capital deficiency. Kesselman & Kesselman, 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 a capital deficiency, recurring losses, negative cash flows from operating activities and has significant future commitments to repay its convertible subordinated notes. These facts raise substantial doubt as to the Company's ability to continue as a going concern. ORECK CORP: OAC Acquisition Wins Court Okay to Buy All Assets ------------------------------------------------------------- The U.S. Bankruptcy Court for the Middle District of Tennessee, in a July 22 ruling, authorized OAC Acquisition Company LLC to purchase substantially all of Oreck Corporation., et al.'s assets pursuant to an asset purchase agreement. In an auction dated July 8, 2013, the qualified bid submitted by OAC Acquisition and Royal Appliance Mfg. Co., as guarantor of the purchaser's obligations under the APA, was chosen by the Debtors, in consultation with the notice parties, as the successful bidder. Upon and subject to the closing, and as a condition thereto, $6,074,797 (the second lien lenders payoff amount) will be wired to one or more bank accounts designated. The U.S. Trustee objected to the sale, arguing that the Debtors' request does not address the issue of how administrative expenses of the Debtors' individual bankruptcy estates, and the proceeds of the contemplated sale of the assets of their respective estates, will be allocated between the nine individual bankruptcy estates, if the motion for substantive consolidation is not granted. About Oreck Corp. Oreck Corporation and eight affiliates sought Chapter 11 protection (Bankr. M.D. Tenn. Lead Case No. 13-04006) in Nashville, Tennessee, on May 6, 2013, with plans to sell the business as a going concern. Oreck has been in the business of manufacturing, marketing and selling vacuum cleaners and related products since the late 1960s. The corporate offices are located in Nashville, and the manufacturing and call center is located in Cookeville, Tennessee. Oreck has 70 employees in Nashville, 250 employees at its plant in Cookeville and 325 employees operating 96 company-owned and managed retail stores. The Debtor disclosed $18,013,249 in assets and $14,932,841 plus an unknown amount in liabilities as of the Chapter 11 filing. William L. Norton III, Esq., and Alexandra E. Dugan, Esq., at Bradley Arant Boult Cummings LLP, serve as counsel to the Debtor. BMC Group Inc. is the claims and notice agent. Sawaya Segalas & Co., LLC serves as financial advisor. The U.S. Trustee appointed six creditors to the Official Committee of Unsecured Creditors. Daniel H. Puryear, Esq., at Puryear Law Group, and Sharon L. Levine, Esq., and Kenneth A. Rosen, Esq., at Lowenstein Sandler LLP represent the Committee. The Committee tapped to retain Gavin/Solmonese LLC as it financial advisor. In July 2013, Royal Appliance Mfg. Co. (RAM), a subsidiary of the TTI Group, finalized the purchase of Oreck Corp.'s assets. The Bankruptcy Court approved the sale on July 16, 2013. Royal, the maker of Dirt Devil floor-care products, won the auction for Oreck Corp. The second-place bidder was the Oreck family, which sold the business in a $272 million transaction in 2003. The Oreck family made the first bid at auction at $21.9 million, including $14.5 million cash. The terms of Royal's winning bid weren't disclosed publicly, according to a Bloomberg News report. Royal was acquired in 2003 by Hong Kong-based Techtronic Industries Co., the maker of Hoover vacuum cleaners. PARADISE HOSPITALITY: Opposes REF WB's Conversion Motion -------------------------------------------------------- Debtor Paradise Hospitality, Inc., opposes the motion of RREF WB Acquisitions, LLC, to convert the Debtor's Chapter 11 case to a case under Chapter 7 of the Bankruptcy Code. According to the Debtor, although it has not been able yet to sell the Shopping Center as the Movant would prefer, it stands at the ready to afford the alternative treatment provided by the confirmed Plan. Further, it has in fact commenced distributions under the Plan, has assumed management of substantially all of the property dealt with by the plan, and had transferred substantially all of the property proposed by the Plan to be transferred, the Debtor said. "The only obstacle is the sale of the Shopping Center. However, since the Plan expressly provides an alternative treatment, the Reorganized Debtor has also complied with this last requirement since it need only transfer this Property as the Plan expressly provides." Pursuant to the confirmed Plan, RREF is to be paid from the proceeds of the sale of the shopping center. Alternatively, If the Debtor does not sell the shopping center, RREF is entitled to exercise its rights under State law after providing a new notice of default. Moreover, according to the Debtor, it is not in the best interests of creditors to convert the case to Chapter 7 as all of the creditors, except for the Movant and possibly taxing authorities, stand to get nothing if the case is converted to Chapter 7. The hearing date is set for Aug. 6, 2013, at 10:30 a.m. Counsel for the Debtor can be reached at: Giovanni Orantes, Esq. Thomas Y. Lucero, Esq. THE ORANTES LAW FIRM, P.C. 3435 Wilshire Blvd., Suite 1980 Los Angeles, CA 90010 Tel: (213) 389-4362 Fax: (877) 789-5776 E-mail: go@gobklaw.com As reported in the TCR on July 22, 2013, senior secured creditor RREF WB Acquisitions, LLC, seeks the conversion of the Chapter 11 case of Paradise Hospitality, Inc. into a Chapter 7 proceeding. RREF asserted that cause exists to convert the case because the Debtor has failed to substantially consummate its First Amended Chapter 11 Plan of Reorganization and is in material default of the Plan. Specifically, RREF cited, the Plan requires the reorganized debtor to sell its retail shopping center, the principal collateral securing the repayment of one of the reorganized debtor's two structured secured debts to RREF no later than 60 days after the Plan Effective Date. "That deadline has not passed, yet the reorganized debtor has not only not sold the shopping center but it has rejected at least one hard offer from a buyer to purchase the shopping center at an amount substantially above RREF's debt amount," RREF said. Against this backdrop, conversion is in the best interest of all creditors and the estate, RREF maintained. About Paradise Hospitality Based in Fullerton, California, Paradise Hospitality, Inc., owns a hotel located in Toledo, Ohio and a retail shopping center in El Dorado, Arkansas. The Debtor manages and operates the Hotel. Haydn Cutler company currently manages the Retail Center. The Company filed for Chapter 11 bankruptcy (Bankr. C.D. Cal. Case No. 11-24847) on Oct. 26, 2011, about three weeks after it lost the right to use the Crowne Plaza for its hotel. For now, the hotel has been renamed Plaza Hotel Downtown Toledo. Judge Erithe A. Smith presides over the case. Giovanni Orantes, Esq., at Orantes Law Firm, P.C., in Los Angeles, represents the Debtor as counsel. The Debtor disclosed $15,628,687 in assets and $21,430,333 in liabilities as of the Chapter 11 filing. The petition was signed by the Debtor's president, Dae In Kim, a Korean businessman who lives in southern California. PARADISE VALLEY: Opposes American Bank's Conversion Motion ---------------------------------------------------------- Paradise Valley Holdings LLC opposes the motion of American Bank to convert its case to one under Chapter 7 of the Bankruptcy Code, citing: 1. Conversion is not in the best interest of creditors. 2. The Debtor disputes the reasons asserted by American Bank to justify conversion, except that the Debtor acknowledges that it is unable to obtain confirmation of a Chapter 11 Plan. The Debtor has otherwise complied with the adequate protection stipulation made with American Bank and has properly managed the estate. 3. The best interests of the creditors is met through dismissal. 4. The creditors of the Debtor do not require a Chapter 7 trustee for their benefit and are better served outside of bankruptcy where there is more opportunity to sell the DIP's asset at a higher price for the benefit of the unsecured creditors. The hearing date is set for Sept. 10, 2013, at 9:00 a.m. Counsel for the Debtor can be reached at: James A. Patten, Esq. PATTEN, PETERMAN, BEKKEDAHL & GREEN P.L.L.C. 2817 2nd Avenue North, Ste. 300 Billings, MT 59101 Tel: (406) 252-8500 Fax: (406) 294-9500 E-mail: jpatten@ppglaw.com As reported in the TCR on July 22, 2013, American Bank asks the U.S. Bankruptcy Court for the District of Montana to convert Paradise Valley Holdings LLC's Chapter 11 case to Chapter 7. Doug James, Esq., at Moulton Bellingham PC, the attorney for American Bank, said that his client wants to put the Debtor under Chapter 7 due to the Debtor's inability to obtain confirmation of a Chapter 11 plan within a reasonable time period. The case has been pending since Sept. 28, 2012. American Bank, Mr. James states, believes that the Debtor is unlikely to be able to confirm a plan. According to Mr. James, the Debtor failed to pay adequate protection to American Bank, which is an undersecured creditor. American Bank also claims that there is also a "gross mismanagement of the estate." About Paradise Valley Holdings Paradise Valley Holdings LLC filed a Chapter 11 petition (Bankr. D. Mont. Case No. 12-61585) in Butte, Montana on Sept. 28, 2012. Paradise Valley, also known as Bullis Creek Ranch, disclosed $14.2 million in total assets and $13.1 million in total liabilities. The Debtor owns properties in Park County, worth $14.0 million, and secures a $12.0 million debt to American Bank. The Debtor disclosed that part of the secured claims against the property is a judgment lien in the amount of $250,000 held by the Museum of the Rockies Inc. resulting from a lawsuit against the debtor for breach of contract. A copy of the schedules is available at http://bankrupt.com/misc/mtb12-61585.pdf Judge Ralph B. Kirscher oversees the case. James A. Patten, Esq., at Patten, Peterman, Bekkedahl & Green, P.L.L.C., serves as the Debtor's legal counsel. PATRIOT COAL: Seeks to Change Loan Accord to Avoid Default ---------------------------------------------------------- Tiffany Kary, writing for Bloomberg News, reported that Patriot Coal Corp., the bankrupt mining company, said sharp declines in demand for coal could cause it to default on loans this year if it can't change its current loan agreement. According to the report, over the past year, falling prices for metallurgical coal have cut into the company's earnings forecasts, Patriot said in papers filed in Manhattan bankruptcy court July 30. The St. Louis-based company filed for bankruptcy in July 2012, citing a drop in demand and $1.6 billion in lifetime health-care obligations for its retirees. Patriot is seeking court approval of a proposed amendment to a $375 million loan, which lenders have already consented to, the report related. The company said it believes "there is a substantial likelihood that, if the amendment is not approved, they may not comply" with current thresholds for earnings beginning in the third quarter. Under the previous loan agreement, Patriot was required to have a minimum of consolidated earnings of $205 million by Dec. 31, the report said. The proposed amendment would drop the threshold to $101.3 million. Patriot, which has $802 million in operating loans, is still negotiating with representatives of its unionized workers, the report added. 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: Hires Duff & Phelps as Valuation Services Provider ---------------------------------------------------------------- Patriot Coal Corp., et al., ask the U.S. Bankruptcy Court for the Eastern District of Missouri for authorization to employ Duff & Phelps, LLC, as the Debtor's valuation services provider in connection with valuation, liquidation analysis and fresh start accounting services required during the Chapter 11 cases, nunc pro tunc to July 11, 2013. Duff & Phelps will provide the Debtors with the following valuation services, subject to Court approval: a. the estimation of the Fair Value and remaining useful life of certain assets and liabilities for the purposes of fresh start accounting, as defined in the Engagement Letters; and b. the estimation of i) the value of the PP&E and Mineral Interests (as defined in the Engagement Letters) assuming that each asset was to be liquidated individually through an orderly liquidation scenario and ii) the value of the PP&E Mineral Interests, Surface Land, and Inventory (as defined in the Engagement Letters) assuming that each asset was to be liquidated individually through a distressed liquidation Scenario. Together, the Orderly Liquidation Value and Distressed Liquidation Value will be referred to as the "Liquidation Values." At the conclusion of the analysis for each (a) and (b) above, Duff & Phelps will provide the Debtors with a written report that will include a narrative description of the methodologies used and the valuation conclusions as to the Liquidation Values and the Subject Assets and Liabilities. These reports will be used by the Debtors and their advisors as part of the bankruptcy analysis necessary for the Debtors to emerge from Chapter 11, specifically to compare the Liquidation Values to the estimated reorganization value of the value as a whole and to comply with fresh start accounting standards. Duff & Phelps intends to charge the Debtors for its fresh start valuation and liquidation valuation services on an hourly basis ranging from $95 for Administrative Staff to $620 for Managing Directors. Duff & Phelps has provided the Debtors with these estimates for the fresh start valuation and liquidation valuation services referenced in the Engagement Letters: Task Estimated Fee Range Valuation of PP&E $100,000 - $105,000 Valuation of Mineral Interest $75,000 - $80,000 Valuation of Surface Land $30,000 - $35,000 Valuation of Other Assets/Liabilities $40,000 - $45,000 Narrative Report and Administration $30,000 - $35,000 Estimation of Liquidation Values $75,000 - $80,000 In addition to the fees set forth above, the Debtors will reimburse Duff & Phelps for any direct expenses incurred in connection with Duff & Phelps' retention in the Chapter 11 cases and the performance of the services set forth in the Engagement Letters. To the best of the Debtors' knowledge, Duff & Phelps and its professionals are "disinterested" as that term is defined in Sec. 101(14) of the Bankruptcy Code, as modified by Sec. 1107(b) of the Bankruptcy Code, and, as required by Sec. 327(a) of the Bankruptcy Code. The Debtors have asked the Bankruptcy Court to expedite the foregoing Application and to schedule the Application for hearing at the Debtor's next scheduled status hearing on Aug. 20, 2013, at 10:00 a.m. 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 serves as lead restructuring counsel. Bryan Cave LLP serves as local counsel to the Debtors. 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. PENSON WORLDWIDE: 5th Amended Plan Filed, Plan Confirmed -------------------------------------------------------- BankruptcyData reported that Penson Worldwide filed with the U.S. Bankruptcy Court a Fifth Amended Chapter 11 Plan of Liquidation. A related Disclosure Statement was not filed as a result of the June 7, 2013 Court order approving the Disclosure Statement. The Court concurrently confirmed the Company's Fifth Amended Chapter 11 Plan of Liquidation, including all Exhibits and modifications thereto. According to documents filed with the Court, "The Plan provides for the Debtors' property to be liquidated, and for the proceeds of the liquidation, including any recoveries obtained from litigation against third parties, to be distributed to holders of Allowed Claims and Equity Interests in accordance with the terms of the Plan and the priority of claims provisions of the Bankruptcy Code. The Plan further provides that on or before the Effective Date, Penson Technologies LLC ('PTL') will be formed as a Delaware limited liability company and all assets of the Debtors will be conveyed and transferred to PTL for the liquidation, administration, and distribution of the Debtors' property by PTL....Pursuant to the PTL LLC Agreement, PTL will be managed by the Board of Managers will consists of two members appointed by the Second Lien Noteholders Committee, one member appointed by the Convertible Noteholders Committee and one member appointed by the Committee." The Debtors and GHP1 previously filed the Fourth Amended Chapter 11 Plan of Liquidation, the Fifth Amended Chapter 11 Plan of Liquidation includes substantially the same terms as the Fourth Amended Plan, except that it removes GHP1 as a Debtor that is subject to the plan." About Penson Worldwide Plano, Texas-based Penson Worldwide Inc. and its affiliates filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 13-10061) on Jan. 11, 2013. Founded in 1995, Penson Worldwide is provider of a range of critical securities and futures processing infrastructure products and services to the global financial services industry. The company's products and services include securities and futures clearing and execution, financing and cash management technology and other related offerings, and it provides tools and services to support trading in multiple markets, asset classes and currencies. Penson was one of the top two clearing brokers overall in the United States. Its foreign-based subsidiaries were some of the largest independent clearing brokers in Canada and Australia and the second largest independent clearing broker in the United Kingdom as of Dec. 31, 2010. In 2012, the company sold its futures division to Knight Capital Group Inc. and its broker-deal subsidiary to Apex Clearing Corp. But the company was unable to successfully streamline is business after the asset sales. Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison LLP, and Young, Conaway, Stargatt & Taylor serve as counsel to the Debtors. Kurtzman Carson Consultants LLC is the claims and notice agent. The U.S. Trustee for Region 3 appointed three members to the Official Committee of Unsecured Creditors: (i) Schonfeld Group Holdings LLC; (ii) SunGard Financial Systems LLC; and (iii) Wells Fargo Bank, N.A., as Indenture Trustee. The Committee selected Hahn & Hessen LLP and Cousins Chipman & Brown, LLP to serve as its co-counsel, and Capstone Advisory Group, LLC, as its financial advisor. Kurtzman Carson Consultants LLC serves as its information agent. The company estimated $100 million to $500 million in assets and liabilities in its Chapter 11 petition. The last publicly filed financial statements as of June 30 showed assets of $1.17 billion and liabilities totaling $1.227 billion. PETER DEHAAN: Sept. 30 Hearing to Confirm Chapter 11 Plan --------------------------------------------------------- The Bankruptcy Court will convene a hearing on Sept. 30, 2013, at 9 a.m., to consider the confirmation of Peter Dehaan Holsteins, LLC's Plan of Reorganization dated July 26, 2013. Written ballots accepting to rejecting the Plan are due Sept. 20. Ballot summary, responses to objections and report of administrative expenses are due by Sept. 25. According to the Second Amended Disclosure Statement, the Debtor will implement the Plan primarily though the sale or surrender of assets. Allowed Administrative Claims of Debtor's professionals (attorneys and accountants) will be paid from funds on hand upon Court approval. The Debtor estimates that Administrative Claims of professionals will total approximately $300,000 as of the Effective Date. The Debtor will continue to list and market the Salem Farm and facilities for sale. The Debtor believes that the Salem Property could be sold for an aggregate price of $4 million. As part of the restructuring, the Debtor will reduce its current dairy operations even further by selling up to an additional 1,200 milk cows and 1,000 heifers which are estimated to generate an additional $2.37 million in proceeds. The implementation of the Plan will be dependant upon completing the anticipated sales of assets in the most tax advantageous methods possible. The previous Plan provides that the Debtor will implement the Plan primarily by selling cattle and satisfying in full the 26 valid and perfected ASL Claims that have been filed. A copy of the Second Amended Disclosure Statement is available for free at http://bankrupt.com/misc/PETER_DEHAAN_2ds.pdf About Peter DeHaan Holsteins Peter DeHaan Holsteins, LLC, is a recognized leader in the dairy industry and well known for producing high quality milk products. Pete DeHaan Jr., the Debtor's 100% owner and Managing Member, has managed and operated dairy facilities in Oregon for over 15 years. The Debtor's principal source of income is from the production and sale of milk, which is shipped to Northwest Dairy Association, a cooperative that transports, processes and sells the resulting milk products. In 2011, the Debtor produced 56,137,722 pounds of whole milk which generated gross income of $11.19 million. Peter DeHaan Holsteins employs 36 employees and its dairy herd consists of 2,194 cows and 2,382 heifers for a total of 4,576 animals. The dairy operations are conducted at three separate farms located in Yamhill County and Washington County Oregon. The primary farm consists of milking facilities and a 230 acre farm located at 22180 Lafayette Highway Salem, Oregon. A second farm is leased from Alan and Alice Beardsley which includes dairy facilities and 280 acres of farmland located in Gaston, Oregon. A third farm consisting of 245 acres is owned by the Debtor and is located in McMinnville, Oregon. The McMinnville Farm is used primarily for raising replacement heifers and growing crops used to feed the Debtor's dairy cattle. Peter DeHaan Holsteins filed a Chapter 11 petition (Bankr. D. Ore. Case No. 12-35080) on June 29, 2012. The Debtor estimated assets of $10 million to $50 million and liabilities of up to $10 million. The Debtor is represented by Jeffrey C. Misley, Esq., at Sussman Shank LLP, in Portland. In its schedules, the Debtor disclosed $11,161,063 in assets and $8,307,564 in liabilities. PHIL'S CAKE: Obtains Final Nod to Use Cash Collateral ----------------------------------------------------- On July 22, 2013, the U.S. Bankruptcy Court for the Middle District of Florida entered a final order authorizing Phil's Cake Box Bakeries, Inc., to use cash collateral of: (i) Southern Commerce Bank, N.A. ("SCB"); (ii) Eagle Trail Drive, LLC, as successor in interest to Zions First National Bank; (iii) Federal Deposit Insurance Corporation, as Receiver of Heritage Bank of Florida; and (iv) Colson, as successor in interest to the United States Small Business Association and the Florida Business Development Corporation, through the Effective Date of the Debtor's confirmed Amended Plan. 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., and Daniel R. Fogarty, Esq., at Stichter Riedel Blain & Prosser, P.A., serve 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. PHIL'S CAKE: Court Confirms Modified Amended Plan ------------------------------------------------- The U.S. Bankruptcy Court for the Middle District of Florida entered on July 9, 2013, entered an order confirming Phil's Cake Box Bakeries, Inc.'s Amended Plan, dated as of April 4, 2013, as Modified on June 24, 2013, and as further modified by the Confirmation Order. A copy of the Confirmation Order is available at: http://bankrupt.com/misc/phil'scake.doc280.pdf As reported in the TCR on June 6, 2013, according to the Amended Disclosure Statement for the Debtor's Amended Plan, holders of Allowed Class 11 Unsecured Claims, which are impaired, will be paid on account of their Allowed Unsecured Claims their Pro Rata Share of the Unsecured Creditor Distribution Fund, which will be in the amount of $250,000. The Reorganized Debtor will make deposits to the Unsecured Creditor Distribution Fund in five equal annual installments, beginning one year from the Effective Date. A full-text copy of the Amended Disclosure Statement is available for free at http://bankrupt.com/misc/PHILSCAKEds0419.pdf 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., and Daniel R. Fogarty, Esq., at Stichter Riedel Blain & Prosser, P.A., serve 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. PNC BANK: $4MM Loan May Belong To Bankrupt Title Co.: 6th Circ. --------------------------------------------------------------- Eric Hornbeck of BankruptcyLaw360 reported that the Sixth Circuit said that $4.1 million a PNC Bank NA predecessor had provisionally forwarded to a client could amount to a fraudulent transfer, saying the funds probably belong to a bankrupt Ohio title company. According to the report, a three-judge panel said that the temporary credit PNC Bank extended to loan intermediary Dayton Title, a typical service for commercial checking accounts while checks are clearing, didn't belong to the lenders that loaned the funds to a real estate developer who, it turned out, had written a fake check. PORTER HAYDEN: Strikes $21MM Deal Over Asbestos Coverage -------------------------------------------------------- Bibeka Shrestha of BankruptcyLaw360 reported that Porter Hayden Co. asked a Maryland federal court to greenlight its $21.5 million settlement with two Ace Group insurers over coverage of asbestos claims, a deal it said would quickly provide substantial funds to its creditors. According to the report, under the deal, Westchester Fire Insurance Co. would pay $20 million, while Century Indemnity Co. would fork over $1.5 million to settle with Porter Hayden, which sold and installed asbestos-containing insulation products. Porter Hayden said the settlement was negotiated in good faith and was fair and reasonable, the report said. RURAL/METRO CORP: Files for Chapter 11 with Restructuring Plan -------------------------------------------------------------- Rural/Metro Corporation on Aug. 4 disclosed that it has reached an agreement-in-principle on a comprehensive financial restructuring plan that will strengthen the Company's balance sheet by reducing its funded indebtedness by approximately 50 percent via a conversion of certain debt to equity and cutting its interest expenses in half. The financial restructuring process will help ensure that Rural/Metro can continue to invest in its business, meet the needs of customers, patients and communities and further improve service. Operations are expected to continue as normal throughout the process. Scott A. Bartos, Rural/Metro's new President and Chief Executive Officer, said, "This agreement is good news for Rural/Metro and for the clients and communities we serve. We have a solution that keeps our operations moving forward while cutting our debt in half. The significant infusion of new capital by our lenders underscores their confidence in the value of our business, and will help ensure that we have a strong financial footing to resume growth and investment while honoring our agreements and continuing to provide outstanding service and patient care." Mr. Bartos continued, "We remain committed to serving our clients and communities, maintaining our relationships with vendors and supporting our employees whose hard work and dedication are critical to our success. We expect to move through this process quickly and to be a stronger, more competitive and more profitable organization." Rural/Metro noted that its capital structure was created under different economic circumstances, and making interest payments on the debt while at the same time investing in operations was more than the Company's earnings could support. Rural/Metro reached the agreement-in-principle on the terms of a prearranged financial restructuring plan with the majority of its senior lenders and approximately two-thirds of its bondholders. To implement the plan, Rural/Metro has elected to file Chapter 11 petitions in the U.S. Bankruptcy Court for the District of Delaware. The Company intends to use the process to significantly reduce its debt, renegotiate unprofitable contracts and free up capital for investments to strengthen its business and further improve patient care. The agreement reached includes a significant cash investment from the Company's bondholders to comprehensively address the Company's capital expenditure needs and ensure the Company continues to provide industry-leading emergency services to its customers. Rural/Metro anticipates completing its restructuring in the fourth quarter of 2013. In conjunction with the filing, Rural/Metro has received a commitment for $75 million in debtor-in-possession financing ("DIP Financing") from certain of the Company's secured lenders. Following Court approval, this financing, combined with cash generated by the Company's ongoing operations, will provide Rural/Metro with sufficient liquidity to meet its operational and restructuring needs. The Company's bondholders have committed to invest $135 million additional dollars of new equity in the fourth quarter of this year to complete the financial restructuring and position the Company for renewed growth. Court filings and other documents concerning the restructuring process are available on a dedicated website administered by Rural/Metro's claims agent, Donlin, Recano & Company, Inc., at http://www.donlinrecano.com/rmc In addition, you can contact the claims agent directly by calling Rural/Metro's restructuring hotline at 212-771-1128. Willkie Farr & Gallagher LLP and Young Conaway Stargatt & Taylor, LLP are serving as legal counsel, Lazard Freres & Co. L.L.C. is serving as investment banker, and Alvarez & Marsal and FTI Consulting, Inc. are serving as financial advisors to Rural/Metro. Rural/Metro was acquired by Warburg Pincus LLC in a 2011 leveraged buyout. Rural/Metro missed a $15.6 million interest payment on July 15, according to Jacqueline Palank, writing for Dow Jones Newswires. Dow Jones says a Warburg representative declined to comment Sunday. About Rural/Metro Headquartered in Scottsdale, Arizona, Rural/Metro Corporation -- http://www.ruralmetro.com-- is a national provider of 911- emergency and non-emergency interfacility ambulance services and private fire protection services, operating in 21 states and nearly 700 communities. * * * As reported by the Troubled Company Reporter on July 26, 2013, Standard & Poor's Ratings Services said it lowered its corporate credit rating on Rural/Metro Corp. to 'SD' from 'CCC'. At the same time, S&P lowered its rating on the company's $200 million and $108 million senior unsecured notes to 'D' from 'CC' as a result of the missed interest payment due July 15. In addition, S&P lowered its rating on the $100 million senior secured revolving credit facility and the $325 million term loan B to 'CC' from 'CCC+'. If the company enters Chapter 11 bankruptcy protection, S&P will lower all ratings to 'D'. As reported by the Troubled Company Reporter on June 3, 2013, Moody's Investors Service downgraded Rural/Metro Corporation's corporate family and probability of default ratings to Caa2 from B3. In addition, Moody's lowered the senior secured credit facilities to B3 from B1 and the senior unsecured notes to Caa3 from Caa2. The ratings outlook remains negative. The downgrade of the corporate family rating to Caa2 with a negative outlook reflects Rural/Metro's highly leveraged capital structure and weak liquidity position, reduced earnings and negative free cash flow, as well as acquisitions that have resulted in a majority of its revolving credit facility being utilized. PRIME ACQUISITION: Gets Notice of Continued Listing on NASDAQ ------------------------------------------------------------- Prime Acquisition Corp., a special purpose acquisition company, on Aug. 1 disclosed that, on July 31, 2013, the Company received a letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC stating that Nasdaq's Hearings Panel had determined to continue the listing of the Company's shares, subject to certain conditions. As previously reported the Company was subject to delisting due to its non-compliance with Listing Rule 5550(a)(3), which requires that the Company maintain a minimum of 300 public holders for continued listing of its securities on Nasdaq, and Listing Rule 5550(a)(4), which requires that the Company maintain a minimum of 500,000 publicly held shares for the continued listing of its securities on Nasdaq. The Panel granted the Company's request for continued listing subject to Prime providing the Panel with updates on progress toward completion of the audited financial statements of the prospective target and progress towards the filing of applicable documents with the SEC. In addition, on or before September 30, 2013, the Company must provide the Panel with information establishing that it has completed the business transaction and has a minimum of 300 round lot shareholders and 500,000 publicly held shares. Diana Liu, Chief Executive Officer of Prime, stated, "We are pleased by the Panel's decision to continue our listing. Everyone at Prime and bhn is working diligently toward closing our proposed transaction and are focused on creating a portfolio of yield- producing assets that will help to build shareholder value." About Prime Acquisition Corp. Prime Acquisition Corp., a Cayman Islands corporation, is a special purpose acquisition company formed for the purpose of acquiring an operating business. PRM FAMILY: U.S. Trustee Appoints 5-Member Creditors Committee -------------------------------------------------------------- Ilene J. Lashinsky, United States Trustee for the District of Arizona, appointed 5 members to the official committee of unsecured creditors of PRM Family Holding Company, L.L.C., et al. The Creditors Committee members are: 1. VALASSIS Hal Manoian 1 Targeting Centre Windsor, CT 06095 Tel: (860) 285-6336 Fax: (860)285-6481 E-mail: hxmanoia@valassis.com 2. G H DAIRY EL PASO Heather Macre, by proxy Aiken, Schenk, Hawkins & Riccardi, PC 2390 E. Camelback Rd., Ste. 400 Phoenix, AZ 85016-3479 Tel: (602) 248-8203 Fax: (602) 248-8840 E-mail: ham@ashrlaw.com 3. ALL AMERICAN PLASTIC & PACKAGING Munther Ghazal 3020 Hoover Ave. National City, CA 91950 Tel: (619) 474-6677 Fax: (619) 474-2356 E-mail: munther@aaplastic.com 4. MARCUS FOOD CO. Keith A. Alter 240 N. Rock Road, Ste. 246 Wichita, KS 67206 Tel: (316) 613-2105 Fax: (316) 684-1266 E-mail: kalter@marcusfoodco.com 5. HIDDEN VILLA RANCH Kathy L. Carter 310 N. Harbor Blvd. Fullerton, CA 92832 Tel: (800) 326-3220, Ext. 2143 Fax: (714) 680-3080 E-mail: kcarter@hiddenvilla.com About PRM Family PRM Family Holding Company, L.L.C., operator of 11 Pro's Ranch Markets grocery stores in Arizona and Texas and New Mexico, sought Chapter 11 protection (Bankr. D. Ariz. Case No. 13-09026) on May 28, 2013. As of the bankruptcy filing, PRM Family Holding operates seven grocery stores in Phoenix, two in El Paso, Texas, and two in New Mexico. Its corporate office is in California and it has warehouses and distribution facilities in California and Phoenix. Its Pro's Ranch Markets feature produce, baked goods and other general grocery items with a Hispanic flair and theme. The company has more than 2,200 employees. PRM Family blamed its woes on, among other things, the adverse effect of the perception in Arizona towards immigrants including the passage of SB 1070 and an immigration audit to which no other competitor was subjected. It also blamed a decline in the U.S. economy and an increase competition from other grocery store chains. Bank of America, the secured lender, declared a default in February 2013. PRM Family estimated liabilities in excess of $10 million. Judge Sarah Sharer Curley oversees the case. Michael McGrath, Esq., Scott H. Gan, Esq., Frederick J. Petersen, Esq., Kasey C. Nye, Esq., David J. Hindman, Esq., and Isaac D. Rothschild, Esq., at Mesch, Clark & Rothschild, P.C., serve as the Debtor's counsel. HG Capital Partners' Jim Ameduri serves as financial advisor. Attorneys at Freeborn & Peters LLP, in Chicago, Ill., represent the Official Committee of Unsecured Creditors as lead counsel. Attorneys at Schian Walker, P.L.C., in Phoenix, Arizona, represent the Committee as local counsel. Robert J. Miller, Esq., Bryce A. Suzuki, Esq., and Justin A. Sabin, Esq., at Bryan Cave LLP, in Phoenix, serve as counsel for Bank of America, N.A., as administrative agent and a lender under an amended and restated credit agreement dated July 1, 2011. PRM FAMILY: Panel Can Retain Freeborn & Peters as Lead Counsel -------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Arizona authorized the Official Committee of Unsecured Creditors of PRM Family Holding Company, L.L.C., et al., to retain the law firm of Freeborn & Peters LLP as lead counsel for the Committee and the law firm of Schian Walker, P.L.C., as local counsel for the Committee effective as of July 10, 2013. The Committee contemplates that the Firms will provide a full range of services to the Committee in the course of these cases, including: (a) advising the Committee on all legal issues as they arise; (b) representing and advising the Committee regarding the terms of any sales of assets or plans of reorganization or liquidation, and assisting the Committee in negotiations with the Debtors and other parties; (c) investigating the Debtors' assets and pre-bankruptcy conduct, and investigating the validity, priority, and extent of the liens and security interests of the Debtors' secured lenders, as well as the pre-bankruptcy conduct of those lenders; (d) preparing, on behalf of the Committee, all necessary pleadings, reports, and other papers; (e) representing and advising the Committee in all proceedings in these cases; (f) assisting and advising the Committee in its administration; and (g) providing such other services as are customarily provided by counsel to a creditors' committee in cases of this kind. The hourly rates for the Freeborn professionals presently expected to have primary responsibility for the cases are as follows: (i) Richard Lauter (Partner) - $585.00/hour; (ii) Thomas Fawkes (Partner) - $505.00/hour; (iii) Jason R. Klinowski (Associate) - $370.00/hour; and (iv) Elizabeth Janczak (Associate) - $240.00/hour. Paraprofessionals working on this case will be billed out between $190.00 and $235.00/hour. The hourly rates for Schian Walker's professionals presently expected to have primary responsibility for these cases are as follows: (i) Dale Schian (Partner) - $525/hour and (ii) Cody Jess (Associate) - $325/hour. Paraprofessionals working on this case will be billed out at $200/hour. About PRM Family PRM Family Holding Company, L.L.C., operator of 11 Pro's Ranch Markets grocery stores in Arizona and Texas and New Mexico, sought Chapter 11 protection (Bankr. D. Ariz. Case No. 13-09026) on May 28, 2013. As of the bankruptcy filing, PRM Family Holding operates seven grocery stores in Phoenix, two in El Paso, Texas, and two in New Mexico. Its corporate office is in California and it has warehouses and distribution facilities in California and Phoenix. Its Pro's Ranch Markets feature produce, baked goods and other general grocery items with a Hispanic flair and theme. The company has more than 2,200 employees. PRM Family blamed its woes on, among other things, the adverse effect of the perception in Arizona towards immigrants including the passage of SB 1070 and an immigration audit to which no other competitor was subjected. It also blamed a decline in the U.S. economy and an increase competition from other grocery store chains. Bank of America, the secured lender, declared a default in February 2013. PRM Family estimated liabilities in excess of $10 million. Judge Sarah Sharer Curley oversees the case. Michael McGrath, Esq., Scott H. Gan, Esq., Frederick J. Petersen, Esq., Kasey C. Nye, Esq., David J. Hindman, Esq., and Isaac D. Rothschild, Esq., at Mesch, Clark & Rothschild, P.C., serve as the Debtor's counsel. HG Capital Partners' Jim Ameduri serves as financial advisor. Attorneys at Freeborn & Peters LLP, in Chicago, Ill., represent the Official Committee of Unsecured Creditors as lead counsel. Attorneys at Schian Walker, P.L.C., in Phoenix, Arizona, represent the Committee as local counsel. Robert J. Miller, Esq., Bryce A. Suzuki, Esq., and Justin A. Sabin, Esq., at Bryan Cave LLP, in Phoenix, serve as counsel for Bank of America, N.A., as administrative agent and a lender under an amended and restated credit agreement dated July 1, 2011. PRM FAMILY: Hearing on BofA's Objection to HG Retention on Sept. 5 ------------------------------------------------------------------ The hearing on the objection of Bank of America, N.A., as Administrative Agent and a Lender under the Amended and Restated Credit Agreement dated July 1, 2011, to PRM Family Holding Company, L.L.C., et al.'s motion to employ HG Capital Partners as financial advisor of the Debtors, and the Agent's motion for reconsideration of the U.S. Bankruptcy Court for the District of Arizona's order dated July 2, 2013, approving the HG Retention will be held on Sept. 5, 2013, at 10:00 a.m. As reported in the TCR on July 1, 2013, HG will, among other things: a. analyze the Debtors' financial data and condition; b. assist with developing and implementing operational efficiencies and cost saving matters; c. prepare projections for the Debtors' plan of reorganization; d. oversee the development of projected financial statements; and e. Analyze and locate DIP loans, exit financing, and additional debt or equity. The professional services that HG Capital Partners may be requested to perform will be provided by Mr. Jim Ameduri, managing partner at HG. Any staff working on the case will report directly to Mr. Ameduri, so the only layer of review will be performed by him, the sole contact person with the Debtors, counsel, and the other constituencies in the case. This will avoid multilevel reviews and layered fee bills customary with national accounting firms, says Michael McGrath, Esq., at Mesch, Clark & Rothschild, PC, the attorney for the Debtor. HG will be paid at these hourly rates: Managing Partners $550 Partners $500 Staff $425 About PRM Family PRM Family Holding Company, L.L.C., operator of 11 Pro's Ranch Markets grocery stores in Arizona and Texas and New Mexico, sought Chapter 11 protection (Bankr. D. Ariz. Case No. 13-09026) on May 28, 2013. As of the bankruptcy filing, PRM Family Holding operates seven grocery stores in Phoenix, two in El Paso, Texas, and two in New Mexico. Its corporate office is in California and it has warehouses and distribution facilities in California and Phoenix. Its Pro's Ranch Markets feature produce, baked goods and other general grocery items with a Hispanic flair and theme. The company has more than 2,200 employees. PRM Family blamed its woes on, among other things, the adverse effect of the perception in Arizona towards immigrants including the passage of SB 1070 and an immigration audit to which no other competitor was subjected. It also blamed a decline in the U.S. economy and an increase competition from other grocery store chains. Bank of America, the secured lender, declared a default in February 2013. PRM Family estimated liabilities in excess of $10 million. Judge Sarah Sharer Curley oversees the case. Michael McGrath, Esq., Scott H. Gan, Esq., Frederick J. Petersen, Esq., Kasey C. Nye, Esq., David J. Hindman, Esq., and Isaac D. Rothschild, Esq., at Mesch, Clark & Rothschild, P.C., serve as the Debtor's counsel. HG Capital Partners' Jim Ameduri serves as financial advisor. Attorneys at Freeborn & Peters LLP, in Chicago, Ill., represent the Official Committee of Unsecured Creditors as lead counsel. Attorneys at Schian Walker, P.L.C., in Phoenix, Arizona, represent the Committee as local counsel. Robert J. Miller, Esq., Bryce A. Suzuki, Esq., and Justin A. Sabin, Esq., at Bryan Cave LLP, in Phoenix, serve as counsel for Bank of America, N.A., as administrative agent and a lender under an amended and restated credit agreement dated July 1, 2011. RURAL/METRO CORP: Voluntary Chapter 11 Case Summary --------------------------------------------------- Sixty-six affiliates that simultaneously filed Chapter 11 petitions: Debtor Case No. ------ -------- RURAL/METRO CORPORATION 13-11952 9221 E. Via de Ventura Scottsdale, AZ 85258 MARICOPA-AZ ARIZONA EMS HOLDINGS, INC. 13-11953 BEACON TRANSPORTATION, INC. 13-11954 BOWERS COMPANIES, INC. 13-11955 COMTRANS AMBULANCE SERVICE, INC. 13-11956 CORNING AMBULANCE SERVICE, INC. 13-11957 DONLOCK, LTD. 13-11958 E.M.S. VENTURES, INC. 13-11959 EASTERN AMBULANCE SERVICE, INC. 13-11960 EASTERN PARAMEDICS, INC. 13-11961 EMERGENCY MEDICAL TRANSPORT, INC. 13-11962 EMS VENTURES OF SOUTH CAROLINA, INC. 13-11963 GOLD CROSS AMBULANCE SERVICE OF PA, INC. 13-11964 GOLD CROSS AMBULANCE SERVICES, INC. 13-11965 LASALLE AMBULANCE, INC. 13-11966 MEDICAL EMERGENCY DEVICES AND SERVICES (MEDS), INC. 13-11967 MERCURY AMBULANCE SERVICE, INC. 13-11968 METRO CARE CORP. 13-11969 NATIONAL AMBULANCE & OXYGEN SERVICE, INC. 13-11970 NORTH MISS. AMBULANCE SERVICE, INC. 13-11971 PACIFIC AMBULANCE, INC. 13-11972 PROFESSIONAL MEDICAL TRANSPORT, INC. 13-11973 R/M ARIZONA HOLDINGS, INC. 13-11974 R/M MANAGEMENT CO., INC. 13-11975 R/M OF TENNESSEE G.P., INC. 13-11976 R/M OF TENNESSEE L.P., INC. 13-11977 RMC CORPORATE CENTER, L.L.C. 13-11978 RURAL/METRO (DELAWARE) INC. 13-11979 RURAL/METRO CORPORATION (AZ) 13-11980 RURAL/METRO CORPORATION OF FLORIDA 13-11981 RURAL/METRO CORPORATION OF TENNESSEE 13-11982 RURAL/METRO FIRE DEPT., INC. 13-11983 RURAL/METRO MID-SOUTH, L.P. 13-11984 RURAL/METRO OF BREWERTON, INC. 13-11985 RURAL/METRO OF CALIFORNIA, INC. 13-11986 RURAL/METRO OF CENTRAL ALABAMA, INC. 13-11987 RURAL/METRO OF CENTRAL COLORADO, INC. 13-11988 RURAL/METRO OF CENTRAL OHIO, INC. 13-11989 RURAL/METRO OF GREATER SEATTLE, INC. 13-11990 RURAL/METRO OF INDIANA, L.P. 13-11991 RURAL/METRO OF NEW YORK, INC. 13-11992 RURAL/METRO OF NORTHERN CALIFORNIA, INC. 13-11993 RURAL/METRO OF NORTHERN OHIO, INC. 13-11994 RURAL/METRO OF OHIO, INC. 13-11995 RURAL/METRO OF OREGON, INC. 13-11996 RURAL/METRO OF ROCHESTER, INC. 13-11997 RURAL/METRO OF SAN DIEGO, INC. 13-11998 RURAL/METRO OF SOUTHERN CALIFORNIA, INC. 13-11999 RURAL/METRO OF SOUTHERN OHIO, INC. 13-12000 RURAL/METRO OF TENNESSEE, L.P. 13-12001 RURAL/METRO OPERATING COMPANY, LLC 13-12002 SAN DIEGO MEDICAL SERVICES ENTERPRISE, L.L.C. 13-12003 SIOUX FALLS AMBULANCE, INC. 13-12004 SOUTHWEST AMBULANCE AND RESCUE OF ARIZONA, INC. 13-12005 SOUTHWEST AMBULANCE OF CASA GRANDE, INC. 13-12006 SOUTHWEST AMBULANCE OF NEW MEXICO, INC. 13-12007 SOUTHWEST AMBULANCE OF SOUTHEASTERN ARIZONA, INC. 13-12008 SOUTHWEST AMBULANCE OF TUCSON, INC. 13-12009 SOUTHWEST GENERAL SERVICES, INC. 13-12010 SW GENERAL INC. 13-12011 THE AID AMBULANCE COMPANY, INC. 13-12012 THE AID COMPANY, INC. 13-12013 TOWNS AMBULANCE SERVICE, INC. 13-12014 VALLEY FIRE SERVICE, INC. 13-12015 W & W LEASING COMPANY, INC. 13-12016 WP ROCKET HOLDINGS, INC. 13-12017 Chapter 11 Petition Date: August 4, 2013 Court: United States Bankruptcy Court District of Delaware Debtors' Counsel: Matthew A. Feldman, Esq. Rachel C. Strickland, Esq. Daniel Forman, Esq. WILLKIE FARR & GALLAGHER LLP 787 Seventh Avenue New York, NY 10019-6099 - and - Maris J. Kandestin, Esq. YOUNG CONAWAY STARGATT & TAYLOR, LLP Rodney Square 1000 North King Street Wilmington, DE 19801 Tel: 302-571-6600 - and - Edmon L. Morton, Esq. YOUNG, CONAWAY, STARGATT & TAYLOR, LLP The Brandywine Bldg. 1000 West Street, 17th Floor P.O. Box 391 Wilmington, DE 19899 Tel: 302 571-6600 Fax: 302-571-1253 Debtors' Financial Advisor: Alvarez & Marsal Healthcare Industry Group, LLC 100 Pine Street San Francisco, CA 94111 - and - FTI Consulting, Inc. 1201 West Peachtree Street, NW Atlanta, GA 30309 Debtors' Investment Banker: Freres & Co. L.L.C. 30 Rockefeller Plaza New York, NY 10112 Debtors' Claims & Noticing Agent: Donlin, Recano & Company, Inc. 419 Park Avenue South New York, NY 10016 The petitions were signed by Stephen Farber, the Debtors' Chief Financial Officer. SARKIS INVESTMENTS: Section 341(a) Meeting Set on Sept. 6 --------------------------------------------------------- A meeting of creditors in the bankruptcy case of Sarkis Investments Company, LLC, will be held on Sept. 6, 2013, at 1:15 p.m. at RM 2612, 725 S Figueroa St., Los Angeles, CA. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in all bankruptcy cases. All creditors are invited, but not required, to attend. This meeting of creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. Sarkis Investments Company, LLC, filed a Chapter 11 petition (Bankr. C.D. Cal. Case No. 13-29180) on July 29, 2013. Pamela Muir signed the petition as manager. The Debtor estimated assets and debts of at least $10 million. Ashley M. McDow, Esq., at Baker & Hostetler, LLP, serves as the Debtor's counsel. SHOTWELL LANDFILL: Seeks to Extend Plan Filing to Aug. 19 --------------------------------------------------------- Shotwell Landfill, Inc., asks the U.S. Bankruptcy Court for an extension until Aug. 19, 2013, of the deadline to file its Chapter 11 plan and disclosure statement. Raleigh, North Carolina-based Shotwell Landfill, Inc., filed a Chapter 11 petition (Bankr. E.D.N.C. Case No. 13-02590) in Wilson on April 19, 2013. The Debtor estimated $10 million to $50 million in assets and liabilities. William P. Janvier, Esq. at the Janvier Law Firm, PLLC, represents the Debtor as counsel. SHOTWELL LANDFILL: Hires Ragsdale Liggett as Special Counsel ------------------------------------------------------------ Shotwell Landfill, Inc., asks the U.S. Bankruptcy Court for permission to employ William W. Pollock, Esq., and Ragsdale Liggett PLLC as special counsel. The firm's rates are: Professional Rates ------------ ----- Partners $325 per hour Associates $165 per hour Paralegals $125 per hour Mr. Pollock attests that it is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About Shotwell Landfill, Inc. Raleigh, North Carolina-based Shotwell Landfill, Inc., filed a Chapter 11 petition (Bankr. E.D.N.C. Case No. 13-02590) in Wilson on April 19, 2013. The Debtor estimated $10 million to $50 million in assets and liabilities. William P. Janvier, Esq. at the Janvier Law Firm, PLLC, represents the Debtor as counsel. SMILE BRANDS: S&P Revises Outlook & Rates $310MM Facility 'B-' -------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook to stable from negative on Smile Brands Group Inc. Standard & Poor's also affirmed its 'B-' corporate credit rating on the company. At the same time, S&P assigned a 'B-' (the same as the corporate credit rating) issue-level rating with a '3' recovery rating to the company's proposed $310 million credit facility. 'The '3' recovery rating indicates S&P's expectation of meaningful (50%-70%) recovery of principal for lenders in the event of a payment default. The proposed credit facility will consist of a $50 million revolving credit facility due 2018 and a $260 million term loan due 2019. The company will use the proceeds of the new credit facility to refinance its existing credit facility. "The outlook revision reflects our expectation that the company's liquidity will be adequate over the near term," said Standard & Poor's credit analyst Gail Hessol. SOLIMAR ENERGY: In Negotiations with SCCP Over Alleged Default -------------------------------------------------------------- Solimar Energy Limited on Aug. 2 disclosed that further to the news release of July 22, 2013, the Company has been in negotiations with SCCP Solimar Holdings LP ("Second City") in relation to their issuance of a "Notice & Request" to Computershare Trust Company of Canada. Solimar has since paid the interest in relation to the alleged default. While the outcome of the negotiations with respect to Second City withdrawing their "Notice & Request" of default cannot be guaranteed, the Company is hopeful that a mutually acceptable resolution will be reached. Headquartered in Melbourne, Australia, Solimar Energy Limited -- http://www.solimarenergy.com.au/-- is engaged in the evaluation, development of onshore oil and gas prospects and production of oil and gas in California. SOUND SHORE: Montefiore Gets Bankruptcy Court OK to Acquire Assets ------------------------------------------------------------------ Montefiore Health System and Sound Shore Health System on Aug. 2 disclosed that Montefiore had received approval from the U.S. Bankruptcy Court for the Southern District of New York (White Plains) for its affiliates to acquire the assets of Sound Shore Health System (SSHS). The transaction, which is subject to regulatory approval, is expected to close this fall. At that time, Montefiore will begin to provide services at Sound Shore and Mount Vernon Hospitals and Schaffer Extended Care Center. Mt. Vernon's Hopfer School of Nursing is an important program and Montefiore is committed to supporting its on-going role training nurses of tomorrow. "As a former resident of New Rochelle for more than 25 years, I have deep affection for this community. I know how important it is to have accessible, high quality health care close to home," said Steven M. Safyer, M.D., president and CEO, Montefiore Health System. "We are excited to be making this significant step into Westchester and to strengthen our partnerships with the community- based physicians to ensure residents of New Rochelle, Mount Vernon and the surrounding neighborhoods receive the exceptional care that they deserve." Sound Shore Health System will continue normal operations until the closing. Upon completion of the transaction, Montefiore will work closely with the dedicated doctors, nurses and staff of Sound Shore and Mount Vernon Hospitals and the Schaffer Extended Care Center, who have served their patients well over many years. Montefiore is committed to preserving jobs and intends to hire substantially all eligible and qualified staff to provide health care services. "This is a significant milestone in the acquisition process as it paves the way for a stronger, more vibrant healthcare infrastructure in southern Westchester," said John Spicer, president and CEO, Sound Shore Health System. "Our physicians and employees have been phenomenally supportive during this period, enabling us to stay true to our promise of providing patients with uninterrupted care and services." About Montefiore Health System Montefiore Health System, Inc. is the parent organization for Montefiore Medical Center, Wakefield Ambulatory Care Center, University Behavioral Associates and other operating entities of the organization. About Sound Shore Health System Sound Shore Medical Center of Westchester, Mount Vernon Hospital Inc., Howe Avenue Nursing Home and related entities sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 13-22840) on May 29, 2013, in White Plains, New York. The Debtors are the largest "safety net" providers for Southern Westchester County in New York. Affiliated with New York Medical College, Sound Shore is a not-for-profit 242-bed, community based- teaching hospital located in New Rochelle, New York. Mountain Vernon Hospital is a voluntary, not-for-profit 176-bed hospital located in Mount Vernon, New York. Howe Avenue Nursing Home is a 150-bed, comprehensive facility. The Debtors tapped Burton S. Weston, Esq., at Garfunkel Wild, P.C. as counsel; Alvarez & Marsal Healthcare Industry Group, LLC, as financial advisors; and GCG Inc., as claims agent. The Debtors are seeking to sell their assets to the Montefiore health system. In June 2013, Montefiore added $4.75 million to its purchase offer for Sound Shore Medical Center and Mount Vernon Hospital to speed up the sale. Montefiore raised its bid to $58.75 million plus furniture and equipment as part of a request for a private sale of the bankrupt New Rochelle and Mount Vernon hospitals, which the Bronx-based health system would like to buy by August 2. Montefiore is represented by Togut, Segal & Segal LLP. Alston & Bird LLP represents the Official Committee of Unsecured Creditors. Sound Shore disclosed assets of $159.6 million and liabilities totaling $200 million. Liabilities include a $16.2 million revolving credit and a $5.8 million term loan with Midcap Financial LLC. There is $9 million in mortgages with Sun Life Assurance Co. of Canada (US) and $11.5 million owing to the New York State Dormitory Authority. SPROUTS FARMERS: S&P Revises Outlook to Pos. & Assigns 'B+' CCR --------------------------------------------------------------- Standard & Poor's Ratings Services said it revised its rating outlook on Phoenix-based Sprouts Farmers Markets Holdings LLC to positive from negative and affirmed its 'B+' corporate credit rating. At the same time, S&P affirmed its 'B+' issue-level rating and revised its recovery rating to '3' from '4' on the company's $60 million revolving credit facility due in 2018 and $700 million term loan B due in 2020. This reflects revised recovery prospects due to less priority debt in the capital structure. The '3' recovery rating indicates S&P's expectation for meaningful (50% to 70%) recovery of principal in the event of payment default. "We also assigned our 'B+' corporate credit rating to Sprouts Farmers Market Inc., parent of Sprouts Farmers Markets Holdings LLC. The outlook revision on Sprouts Farmers Market LLC reflects the successful completion of an IPO of its common stock. According to the company, it raised $383 million of proceeds, of which approximately $345 million of net proceeds will be used to repay borrowings under its credit facility," said credit analyst Kristina Koltunicki. "The debt pay down strengthened credit protection measures ahead of our projections. We forecast debt- to-EBITDA to be in the low 4.0x-area over the next 12 months." "The positive outlook reflects our expectation that Sprouts will continue to increase revenues and profits meaningfully over the next 12 months as we anticipate continued robust new store growth and strong operating performance at its existing stores. Credit protection measures may improve above our forecasted levels over the next year if the company can successfully execute its expansion strategy while leveraging its cost structure leading to additional performance gains. It also incorporates our expectation that financial sponsor, Apollo, will reduce its common stock ownership in the company to below 40%," S&P added. "We could raise our ratings if leverage declines below 4.0x. This could occur if EBITDA grows 10% over our projected levels while debt remains constant. We would also need further confidence that Apollo could reduce its stake in Sprouts over the next 24 months and that leverage would remain less than 4.0x on a sustained basis," S&P added. Although unlikely, S&P could revise the outlook to stable if debt- to-EBITDA does not decline as much as anticipated due to weaker- than-expected operating performance from a slower executed store expansion or an increase in competitive pressures. This could occur if margins decline by approximately 100 bps, while the company maintains our projected revenue growth levels for 2013. At that time, leverage would be in the mid-5x area. STANDARD PACIFIC: Fitch Rates $300MM Unsecured Notes at 'B/RR4' --------------------------------------------------------------- Fitch Ratings has assigned a 'B/RR4' rating to Standard Pacific Corp.'s (NYSE: SPF) proposed offering of $300 million aggregate principal amount of 6.25% senior unsecured notes due 2021. Proceeds from the notes offering will be used for general corporate purposes, including land acquisition and development, home construction, and other related purposes. The Rating Outlook is Positive. Key Rating Drivers The ratings reflect the company's execution of its business model, geographic and product line diversity and adequate liquidity position. Fitch expects further gains in industry housing metrics this year as the housing cycle continues to evolve. However, there are still challenges facing the housing market that are likely to moderate the early stages of this recovery, including recent sharp increases in interest rates and home prices. Nevertheless, SPF has the financial flexibility to navigate through the sometimes challenging market conditions and continue to invest in land opportunities. Risk factors include the cyclical nature of the homebuilding industry, SPF's aggressive land strategy, and, although improving, still high leverage position. The Positive Outlook takes into account the improving housing industry outlook for 2013 and 2014 and also the above average performance relative to its peers in certain financial, credit and operational categories. The Industry Housing metrics all showed improvement so far in 2013. For the first six months of the year, single-family housing starts improved 24.3% and existing home sales expanded 10.3%. New home sales also increased 28.4% during the January - June period in 2013. The most recent Freddie Mac 30-year interest rate was 4.31%, 100 basis points (bps) above the all-time low of 3.31% set the week of Nov. 21, 2012. The NAHB's latest existing home affordability index was 172.7, short of the all-time high of 207.3. Fitch's housing estimates for 2013 are as follows: single- family starts are forecast to grow 18.3% to 633,000 while multifamily starts expand about 25% to 307,000; single-family new home sales should increase approximately 24% to 455,000 as existing home sales advance 7.5% to 5.01 million. Average single-family new home prices (as measured by the Census Bureau), which dropped 1.8% in 2011, increased 8.7% in 2012. Median home prices expanded 2.4% in 2011 and grew 7.9% in 2012. Average and median home prices should improve approximately 5.5% and 4.5%, respectively, in 2013. Housing metrics should expand next year due to the economy growing more rapidly in 2014, job growth moderately expanding (and unemployment rates decreasing to 7.5% for 2013 from an average of 7.8% in 2013), despite somewhat higher interest rates as well as more measured home price inflation. Single-family starts are projected to improve 22.4% to 775,000 and multifamily volume grows about 9% to 335,000. Thus, total starts next year should top 1 million. New home sales are forecast to advance about 24% to 565,000, while existing home volume increases 5% to 5.26 million. New home price inflation should moderate next year, at least partially because of higher interest rates. Average and median new home prices should rise about 3.5% and 2.5%, respectively, in 2014. Challenges (although somewhat muted) remain, including continued relatively high levels of delinquencies, potential for short-term acceleration in foreclosures, and consequent meaningful distressed sales, and restrictive credit qualification standards. Land Strategy SPF is focused on growing its operations by investing in new communities, particularly in land-constrained markets. Following the significant reduction of its land supply during the 2006 -2009 periods, SPF began to increase its land holdings during 2010, 2011, 2012 and far in 2013. At June 30, 2013, the company had 35,126 lots controlled, a 26.5% increase over the previous year and 83% growth over year-end 2009 land holdings. Its owned and optioned lot positions increased 28.7% and 36%, respectively, as compared to the second quarter 2012, while its joint venture lot position fell 51.3% year-over-year. Based on the latest 12 month (LTM) closings, SPF controlled 9.1 years of land and owned roughly 7.1 years of land. The company spent $711 million on land and development during 2012 compared with $437 million expended in 2011 and $336 million in 2010. SPF spent roughly $418 million through the first six months of 2013 and expects total spending will be between $600 million and $900 million for the year, which includes roughly $200 million - $300 million of development expenditures. Fitch is comfortable with SPF's aggressive land strategy given the company's liquidity position. The company ended the second quarter of 2013 with $65.1 million of unrestricted cash and $317.5 million of availability under its unsecured revolving credit facility. The proposed $300 million debt offering further supplements the company's liquidity position. SPF's debt maturities are well- laddered, with only $35 million of debt coming due through 2015 as of June 30, 2013. Fitch expects SPF in the intermediate term will maintain liquidity of at least $350 million - $400 million from a combination of cash and revolver availability. Credit Metrics SPF has shown improvement in credit metrics over the past 18 months. Debt to EBITDA (as calculated by Fitch) improved from 12.4x during 2011 to 8.2x during 2012. On a pro forma basis including the proposed notes offering, debt to EBITDA for the LTM period ending June 30, 2013 would be approximately 7x. Similarly, interest coverage improved from 0.8x during 2011 to 1.3x during 2012 and 1.9x for the LTM period ending June 30, 2013. Fitch expects further improvement in these credit metrics for the remainder of the year. Rating Sensitivities Future ratings and Outlooks will be influenced by broad housing market trends as well as company-specific activity, such as: -- Trends in land and development spending; -- General inventory levels; -- Speculative inventory activity (including the impact of high cancellation rates on such activity); -- Gross and net new order activity; -- Debt levels; -- Free cash flow trends and uses; and -- SPF's liquidity position. The company's ratings could be upgraded to 'B+' if the company performs in line with Fitch's 2013 expectations, including revenue growth of about 35%, EBITDA margins of between 15%-16%, debt to EBITDA of around 6x and interest coverage in excess of 2x. Negative rating actions could occur if the recovery in housing dissipates, resulting in revenues approaching 2011 levels, EBITDA margins of roughly 10%, interest coverage falling below 1x and liquidity declining below $200 million. Fitch currently rates SPF as follows: -- Long-term Issuer Default Rating 'B'; -- Senior unsecured notes 'B/RR4'; -- Unsecured revolving credit facility 'B/RR4'. The Rating Outlook is Positive. The 'RR4' Recovery Rating (RR) on the company's unsecured debt indicates average recovery prospects for holders of these debt issues. Standard Pacific's exposure to claims made pursuant to performance bonds and joint venture debt and the possibility that part of these contingent liabilities would have a claim against the company's assets were considered in determining the recovery for the unsecured debt holders. The Fitch applied a liquidation value analysis for these RRs. TELETOUCH COMMUNICATIONS: To Liquidate Under Chapter 11 ------------------------------------------------------- Teletouch Communications, Inc., disclosed in a filing with the U.S. Securities and Exchange Commission that it and its subsidiary intend to file voluntarily petitions under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware in order to liquidate their assets. The Company said it has no further access to any cash to pay its obligations after DCP Teletouch Lender, LLC, asserted control over the Company's bank accounts. It is expected that the voluntary petitions will be filed during the week of Aug. 5, 2013. On July 30, 2013, the Senior Lender blocked the Company's access to approximately $789,000 in cash and instructed the Company's banks to transfer all existing cash balances and future cash deposits received by the Company to an account owned and controlled by DCP. According to the filing, the Company has defaulted under its Loan Agreement DCP. The Company is in a dialogue with DCP regarding an arrangement that would enable the Company to fund its critical obligations in the short-term pursuant to a cash budget that would be required to be approved in advance by DCP. As of Aug. 2, 2013, a mutually agreeable cash budget has not concluded. Teletouch plans to file a Form 15 with the SEC to terminate the registration of its common stock under the Securities Exchange Act of 1934, as amended. Following that filing, the Company will no longer be obligated to file any periodic or other reports under the Securities Exchange Act of 1934. In June 2013, Teletouch has exited the wholesale distribution line of business citing its inability to sustain further losses. The Board has appointed Michael Juniper, a senior manager of Deloitte CRG as chief restructuring officer. The CRO's primary responsibilities will involve the direct management of the liquidation process, including among other things, assisting in the negotiation of forbearance and restructuring arrangements with senior lenders, assisting in negotiations with creditors to assure continued support during the Liquidation, supporting the management in negotiating out-of-court settlements and in preparing bankruptcy filings, appearing as a representative of the Debtors in the Bankruptcy Court, and generally assisting management through the bankruptcy process. The Company has retained the services of the Corporate Restructuring Group of Deloitte Financial Advisory Services LLP. About Teletouch Teletouch Communications, Inc., offers a comprehensive suite of wireless telecommunications solutions, including cellular, two-way radio, GPS-telemetry and wireless messaging. Teletouch is an authorized provider of AT&T (NYSE: T) products and services (voice, data and entertainment) to consumers, businesses and government agencies, as well as an operator of its own two-way radio network in Texas. Recently, Teletouch entered into national agency and distribution agreements with Sprint (NYSE: S) and Clearwire (NASDAQ: CLWR), providers of advanced 4G cellular network services. Teletouch operates a chain of 26 retail and agent stores under the "Teletouch" and "Hawk Electronics" brands, in conjunction with its direct sales force, customer care (call) centers and various retail eCommerce Web sites including: http://www.hawkelectronics.com/and http://www.hawkexpress.com/ Through its wholly-owned subsidiary, Progressive Concepts, Inc., Teletouch operates a national distribution business, PCI Wholesale, primarily serving large cellular carrier agents and rural carriers, as well as auto dealers and smaller consumer electronics retailers, with product sales and support available through http://www.pciwholesale.com/and http://www.pcidropship.com/among other B2B oriented Web sites. BDO USA, LLP, in Houston, Texas, issued a "going concern" qualification on the consolidated financial statement for the year ended May 31, 2012. The independent auditors noted that the Company has increasing working capital deficits, significant current debt service obligations, a net capital deficiency along with current and predicted net operating losses and negative cash flows which raise substantial doubt about its ability to continue as a going concern. For the nine months ended Feb. 28, 2013, the Company incurred a net loss of $622,000 on $14.94 million of total operating revenues, as compared with net income of $4 million on $19.02 million of total operating revenues for the nine months ended Feb. 29, 2012. The Company's balance sheet at Feb. 28, 2013, showed $10.38 million in total assets, $16.91 million in total liabilities and a $6.53 million total shareholders' deficit. TWIN DEVELOPMENT: Hires Robert Legate as Special Counsel -------------------------------------------------------- Twin Development, LLC asks the U.S. Bankruptcy Court for permission to employ Robert J. Legate as special counsel. The professional services Mr. Legate will perform are related to the prosecution of the claims against La Jolla Bank, Rick Hall, and Martin Rodriguez as counsel of record in a pending state court action, including but not limited to: 1. all litigation and preparation for litigation; 2. harvesting assets for the Debtor enabling the Debtor to prepare and fund a plan in this case; 3. negotiations regarding any potential settlements; and 4. performing all other legal services for Debtor in regards to the pending State Action. Robert J. Legate attests that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. Mr. Leegate has agreed to work on a contingency fee of 40% to 45% of any recovery from the state action. Twin Development, LLC, filed a Chapter 11 petition (Bankr. S.D. Cal. Case No. 13-02719) on March 19, 2013. The petition was signed by Wallace Benwart as manager. The Debtor scheduled assets of $55,800,000 and liabilities $38,027,600. US POSTAL: CCAGW Says New Senate Bill Fails to Prevent Bankruptcy ----------------------------------------------------------------- On Aug. 2, the Council for Citizens Against Government Waste denounced S. 1486, the Postal Reform Act of 2013. The Senate bill bails out the Postal Service (USPS), favors unions over consumers and taxpayers, and fails to prevent USPS's bankruptcy. The bill, introduced by Senators Tom Carper (D-Del.) and Tom Coburn (R- Okla.) on Aug. 1, prevents USPS from implementing many of the reforms that CCAGW has long insisted are essential to right-sizing the Postal Service and sparing taxpayers the consequences of its collapse. For example, rather than allowing USPS to close excess plants and processing facilities that have become expendable in light of declining mail volumes, S. 1486 would block USPS from closing unnecessary facilities and post offices for two years. In a November 21, 2011 speech before the National Press Club, Postmaster General Patrick Donahoe pointed out that "roughly 25,000 out of our 32,000 Post Offices operate at a loss." He added that thousands of post offices have less than $20,000 in annual revenue yet cost more than $60,000 to operate, and many of these unprofitable locations are a few miles away from another post office. Any legislation that does not demand that USPS take swift steps to close excess postal facilities is unacceptable. Despite the fact that more than 80 percent of USPS' expenses are labor costs, the bill avoids the issue of reducing its labor force. It also removes the existing cap on price hikes for first- class mail, a policy that will likely increase consumers' transition away from USPS and toward electronic alternatives, therefore defeating the provision's intended purpose of increasing revenue. The bill also encourages USPS to pursue other forms of revenue (such as a clothing line), even if doing so means engaging in direct competition with existing industries, and requires no plan or commitment that such ventures be profitable. Not content with its monopoly over the mail, USPS would be allowed to crowd in on other firms' market share. The legislation will worsen the flow of red ink at USPS, which lost $8.5 billion in fiscal year (FY) 2010, $5.1 billion in FY 2011, and a staggering $15.9 billion in FY 2012. In the second fiscal quarter of FY 2013, USPS lost another $1.9 billion. Decreased demand has resulted in dwindling incomes at USPS; first class mail, which makes up more than half of USPS revenue, peaked in 2006, and fell 20 percent over the next four years. In short, the USPS business model is broken; half-measures and compromises cannot revive the organization. "While we at CCAGW appreciate any effort to right the ship at USPS, S. 1486 fails to create the kinds of changes that will have a meaningful impact on the Postal Service's bottom line," said CCAGW President Tom Schatz. "S. 1486 tackles an important issue for taxpayers, but its effects would be worse than doing nothing. The Senate should quickly go back to the drawing board; USPS is sinking fast." The Council for Citizens Against Government Waste (CCAGW) is the lobbying arm of Citizens Against Government Waste, the nation's largest nonpartisan, nonprofit organization dedicated to eliminating waste, fraud, abuse, and mismanagement in government. About U.S. Postal Service A self-supporting government enterprise, the U.S. Postal Service is the only delivery service that reaches every address in the nation, 151 million residences, businesses and Post Office Boxes. The Postal Service receives no tax dollars for operating expenses, and relies on the sale of postage, products and services to fund its operations. With 32,000 retail locations and the most frequently visited website in the federal government, usps.com, the Postal Service has annual revenue of more than $65 billion and delivers nearly 40 % of the world's mail. If it were a private sector company, the U.S. Postal Service would rank 35th in the 2011 Fortune 500. In 2011, the U.S. Postal Service was ranked number one in overall service performance, out of the top 20 wealthiest nations in the world, Oxford Strategic Consulting. Black Enterprise and Hispanic Business magazines ranked the Postal Service as a leader in workforce diversity. The Postal Service has been named the Most Trusted Government Agency for six years and the sixth Most Trusted Business in the nation by the Ponemon Institute. The Postal Service receives no tax dollars for operating expenses and relies on the sale of postage, products and services to fund its operations. The U.S. Postal Service ended the first three months of its 2012 fiscal year (Oct. 1 - Dec. 31, 2011) with a net loss of $3.3 billion. Management expects large losses to continue until the Postal Service has implemented its network re-design and down- sizing and has restructured its healthcare program. Additionally, the return to financial stability requires legislation which gives the Postal Service typical commercial freedoms, including delivery flexibility, returns over $10 billion of amounts overpaid to the Federal Government and resolves the need to prefund retiree healthcare at rates not assessed any other entity in the United States. To return to profitability, CEO Patrick Donahoe has advanced a plan to reduce annual costs by $20 billion by 2015. The plan includes continued aggressive actions to generate additional revenue and reduce operating expenses. To reach the goal, the Postal Service also needs changes in the law. "Passage of legislation is urgently needed that provides the Postal Service with the speed and flexibility needed to cut costs that are not under our control, including employee health care costs," Donahoe said in February 2012 "The changes will give the Postal Service a bright future and provide the nation with affordable and reliable delivery for generations to come." VAN DYKE: Moody's Lowers Ratings on $34.5MM Debt to 'Ba1' --------------------------------------------------------- Moody's Investors Service has downgraded to Ba1 from Baa2 the rating on Van Dyke Public Schools, MI. The outlook on the district remains negative. The Ba1 rating and negative outlook affects $34.5 million of outstanding rated general obligation debt. The district has a total of $59.4 million of outstanding general obligation debt. Rating Rationale: The district's outstanding rated bonds are secured by its general obligation unlimited property tax pledge. Additionally, all outstanding bonds are further secured by the State of Michigan's (GO rated Aa2/positive outlook) School Bond Qualification and Loan Program (SBQLP) which provides debt service assistance through its School Loan Revolving Fund (SLRF). Moody's has a Aa2 rating with a positive outlook on the enhancement program. Fundamental to the program's rating is its sound mechanics to ensure timely payments, which include a provision for independent third party notification to the state in the event of debt service insufficiency, and the strength of the state's general obligations, currently rated Aa2 with positive outlook. The downgrade to Ba1 reflects the district's deficit General Fund balance which is not projected to return to positive balance until fiscal 2016. Also incorporated is the district's modestly-sized, depreciating tax base north of Detroit (GO rated Caa3/rating under review for downgrade); well below average socioeconomic characteristics typical of Detroit area residential suburbs that have historically been dependent on regional manufacturing jobs; declining enrollment, likely due to outmigration of students to other districts and charter schools as well as demographic shifts; and elevated debt burden. The negative outlook reflects the uncertainty that the district will be able to achieve its current Deficit Elimination Plan (DEP) given recent negative budgetary variances and unstable enrollment trends. Strengths: - Continued support of the State of Michigan's School Loan Revolving Fund to meet debt service obligations - State oversight of the district's DEP process, though financial improvements thus far have been limited Challenges: - Deficit General Fund balance not projected to be rectified until fiscal year 2016 - Annual declines in enrollment negatively affecting core operating revenues - Rapidly depreciating tax base with well below average socioeconomic characteristics - Elevated debt profile Outlook: The negative outlook reflects ongoing pressures to the district's credit profile which makes the district's ability to fulfill its current DEP uncertain. What Could Move the Rating Up (Or Remove the Negative Outlook) - Ability to implement and realize the goals of the current Deficit Elimination Plan - Stable to increasing trends in enrollment leading to increases in operating revenues to assist in reestablishing a positive General Fund position What Could Move the Rating Down? - Failure to eliminate the deficit General Fund balance in a timely manner and/or continued financial deterioration - Inability to maintain adequate liquidity to meet operational costs - Continued enrollment declines resulting in greater than anticipated revenue pressures Principal Methodology Used The principal methodology used in this rating was General Obligation Bonds Issued by US Local Governments published in April 2013. WOOTON GROUP: Balks at Bid to Dismiss or Convert Case ----------------------------------------------------- Wooton Group, LLC, opposes a motion filed by the United States Trustee's Office to dismiss or convert the Debtor's Chapter 11 case. The Office of the U.S. Trustee filed the request on July 16, 2013. In opposing the request, the Debtor argues that: -- it provided evidence of current insurance coverage on July 25, 2013. -- its Monthly Operating Report for June 2013 was filed on July 19, 2013. -- the quarterly fees for the period ending June 30, 2013 were due by July 31, 2013. The Debtor has said it would pay the quarterly fees by July 31, 2013. The Debtor requests that the U.S. Trustee's Motion be denied or that the hearing be continued to permit the Debtor to come into full compliance. Attorneys for the Debtor can be reached at: M. Jonathan Hayes, Esq. Matthew D. Resnik, Esq. Roksana D. Moradi, Esq. Carolyn M. Afari, Esq. SIMON RESNIK HAYES LLP 15233 Ventura Boulevard, Suite 250 Sherman Oaks, CA 91403 Tel: (818) 783-6251 Fax: (818) 783-6253 E-mail: jhayes@SRHLawFirm.com matthew@SRHLawFirm.com roksana@SRHLawFirm.com carolyn@SRHLawFirm.com Beverly Hills, Calif.-based Wooton Group, LLC, filed a bare- bones Chapter 11 petition (Bankr. C.D. Cal. Case No. 12-31323) in Los Angeles on June 19, 2012. Judge Thomas B. Donovan oversees the case. M. Jonathan Hayes, Esq., Matthew D. Resnik, Esq., and Roksana D. Moradi, Esq., at Simon Resnik Hayes LLP, in Sherman Oaks, Calif., represent the Debtor as counsel. The petition was signed by Mark Slotkin, managing member. In its schedules, the Debtor disclosed assets of $10,500,961 and debts of $7,227,376 as of the petition date. * LPS' June Mortgage Monitor Shows Spike in Delinquency Rate ------------------------------------------------------------ The June Mortgage Monitor report released by Lender Processing Services found that the nearly 10 percent spike in the national delinquency rate reported in the company's "First Look" at mortgage performance was based on approximately 700,000 newly 30- day delinquent loans in June. As LPS Applied Analytics Senior Vice President Herb Blecher explained, the spike -- while large -- should be seen in the proper context. "June's increase in delinquencies is representative of a documented seasonal phenomenon," Mr. Blecher said. "Over the last 18 years, similar changes occurred in June for all but four of those years. And this month's increase was felt across all 50 states -- from a roughly 14 percent month-over-month rise in 30- day delinquencies in Nevada to a nearly 32 percent upswing in Colorado. Additionally, we examined the data to see the effect of recent increases in interest rates on delinquency rates and found no significant impact thus far. Adjustable-rate mortgages (ARMs), which one would expect to be impacted most by such interest rate changes, actually saw delinquency rates rise at a lower relative rate than those of fixed-rate mortgages. "Of course, focusing solely on month-to-month shifts in mortgage performance can be like tracking the stock market on a daily basis," Mr. Blecher continued. "You may see periodic spikes and dips, but without a longer-term perspective, you lack a clear picture of how the market is actually performing. Though June's 9.9 percent spike was indeed significant -- and a reversal of five consecutive months of declines -- on a quarterly basis, the rise was much more moderate than the historical average. Since 1995, delinquency rates have risen from Q1 to Q2 in all but two years, with an average 7 percent increase. By comparison, the 2013 Q1 to Q2 increase was just 1.34 percent." Looking further into the impact of mortgage interest rate changes, LPS re-examined the pool of potential refinanceable mortgages and found that, despite improved equity situations nationwide, fewer loans have refinanceable characteristics at the new rates, as many loans currently have a lower interest rate. Approximately 12 percent of active loans, about 5.9 million, fit broad-based refinanceable criteria, down from 8.9 million in March of 2013 when rates were at historic lows. Still, while prepayment rates (historically a good indicator of refinance activity) had declined 12 percent in June in the face of rising interest rates, they were higher than when interest rates were last at this point back in 2011. As reported in LPS' First Look release, other key results from LPS' latest Mortgage Monitor report include: Total U.S. loan delinquency rate: 6.68% Month-over-month change in delinquency rate: 9.91% Total U.S. foreclosure presale inventory rate: 2.93% Month-over-month change in foreclosure presale inventory rate: -3.92% States with highest percentage of non-current* loans: FL, MS, NJ, NY, ME States with the lowest percentage of non-current* loans: WY, MT, AK, SD, ND *Non-current totals combine foreclosures and delinquencies as a percent of active loans in that state. Totals are extrapolated based on LPS Applied Analytics' loan-level database of mortgage assets. * Morgan Drexen Challenges Constitutionality of CFPB Structure -------------------------------------------------------------- The CFPB structure has faced constitutional challenges on a number of political and judicial fronts. The CFPB has managed to evade all examinations of its fundamental make-up, this time on a procedural technicality. On Aug. 1, Federal District Court Judge Ellen Huvelle granted the Motion to Dismiss filed by the Consumer Financial Protection Bureau, dismissing for lack of standing the constitutional challenge brought by State National Bank of Big Spring, the Competitive Enterprise Institute, and 11 states. "The CFPB was able to dodge the ultimate question of its structural legitimacy for now," said Venable LLP partner Randall K. Miller, the attorney representing Morgan Drexen in its case against the CFPB. "But our case is very different, because we are the target of an over reaching and harmful enforcement proceeding that has reached the point of threats of an imminent lawsuit," Mr. Miller said. Attorney Kimberly Pisinski and Morgan Drexen, Inc., a software and business support services company, sued the CFPB on grounds the agency is not constitutional, and that the agency has attempted to data mine the personal financial details and attorney client communications of thousands of Ms. Pisinski's clients by demanding information protected by the attorney-client privilege. "My clients have a legitimate right to their expectation of privacy," said Ms. Pisinski, an attorney licensed in Connecticut. Pisinski, whose practice primarily focuses on child advocacy issues, uses Morgan Drexen's software platform to help her with her clients, including those who are seeking bankruptcy protection. "The documents demanded by the CFPB include the names, addresses, social security numbers, names of debtors, amounts owed, all attorney notes regarding attorney client communications, the length of the communications, and other personal information that is NOT public information," said Morgan Drexen CEO Walter Ledda. "The attorneys who hire Morgan Drexen have told us not to release this information about their clients. Doing so would destroy the reputation of the company, not to mention, the long-standing right of a consumer to the attorney-client privilege," he said. About Morgan Drexen Morgan Drexen -- http://www.morgandrexen.com-- provides businesses across the United States, including law firms that practice bankruptcy, with outsourced professional services. These services are designed to reduce costs and make legal representation affordable for consumers. Morgan Drexen offers attorneys automated platforms for complex document management, client databases, paralegal and paraprofessional services, call centers, client screening, and marketing. * Ralph Lay Joins Algon Group as Senior Managing Director --------------------------------------------------------- Algon Group on Aug. 2 disclosed that banking industry veteran Ralph Lay has recently joined the firm as Senior Managing Director. The addition of Lay enhances the firm's capabilities in providing both corporate and real estate advisory services and solutions to Algon Group's clients. Mr. Lay will handle advisory assignments for both lenders and borrowers, act as a Court Appointed Receiver/Trustee, provide litigation/expert services and advise investors in the purchase of individual assets, loans and portfolios. Troy Taylor, President of Algon said, "The addition of Ralph to the Algon team further enhances our capabilities in providing industry-leading financial advisory services for results-oriented clients in challenging, unique situations." With nearly 30 years at Bank of America and its predecessors, Mr. Lay brings vast real estate capital markets experience to the Algon senior team, and has led transactions approaching $10 billion in value for leading real estate firms including the Related Group, WCI Communities, Crescent Resources, Sea Island, Kiawah Island, Reynolds Plantation, Faison Properties, Pannatonni Group and John Wieland Homes, among others. Most recently, he served as Bank of America's Senior Vice President Region Executive Real Estate Managed Accounts. He has been involved in some of the largest real estate syndications in the industry. Mr. Lay has done business across the US, in Canada and in the Caribbean. He also has experience in multiple jurisdictions with litigation, bankruptcy, receiverships, note sales and restructures. About Algon Algon Group -- http://www.algongroup.com-- is a specialized financial advisory firm that provides sophisticated financial analysis and advisory services to debtors, creditors, equity holders and third party constituencies. Algon professionals each have decades of investment banking experience and, in aggregate, have handled transactions in excess of $20 billion during their collective careers. Algon has handled over $3.7 billion of restructurings/transactions in the last 48 months on behalf of public and private entities. The firm has a nationwide footprint with professionals in Atlanta, Birmingham, Charlotte, Phoenix, Philadelphia and Tampa Bay. Algon is a strategic partner in 32 Advisors-Algon, a joint venture with 32 Advisors. * Large Companies With Insolvent Balance Sheets ----------------------------------------------- Total Share- Total Total Holders' Working Assets Equity Capital Company Ticker ($MM) ($MM) ($MM) ------- ------ ------ -------- ------- ABSOLUTE SOFTWRE ABT CN 120.5 (14.1) (11.1) ACASTI PHARMA IN APO CN 3.3 (1.8) 2.3 ADVANCED EMISSIO ADES US 92.5 (39.8) (11.0) ADVENT SOFTWARE ADVS US 824.6 (114.8) (202.7) AK STEEL HLDG AKS US 3,772.7 (181.0) 473.3 ALLIANCE HEALTHC AIQ US 528.2 (131.1) 64.8 AMC NETWORKS-A AMCX US 2,568.3 (825.3) 620.4 AMER AXLE & MFG AXL US 3,008.7 (101.6) 345.2 AMERISTAR CASINO ASCA US 2,125.6 (2.6) (60.2) AMR CORP AAMRQ US 26,216.0 (8,216.0) (1,034.0) AMYLIN PHARMACEU AMLN US 1,998.7 (42.4) 263.0 ANACOR PHARMACEU ANAC US 37.4 (8.0) 9.5 ANGIE'S LIST INC ANGI US 111.8 (11.9) (9.4) ARRAY BIOPHARMA ARRY US 107.4 (52.4) 40.0 AUTOZONE INC AZO US 6,783.0 (1,532.3) (657.7) BERRY PLASTICS G BERY US 5,045.0 (251.0) 606.0 BIOCRYST PHARM BCRX US 46.9 (2.8) 24.1 BOSTON PIZZA R-U BPF-U CN 156.7 (108.0) (4.2) BRP INC/CA-SUB V DOO CN 1,768.0 (496.6) (21.8) BUILDERS FIRSTSO BLDR US 505.5 (8.5) 188.3 CABLEVISION SY-A CVC US 7,588.1 (5,565.5) (14.0) CAESARS ENTERTAI CZR US 26,844.8 (738.1) 833.8 CALLIDUS SOFTWAR CALD US 123.1 (2.1) 2.9 CAPMARK FINANCIA CPMK US 20,085.1 (933.1) - CC MEDIA-A CCMO US 15,296.5 (8,289.2) 1,259.4 CENTENNIAL COMM CYCL US 1,480.9 (925.9) (52.1) CHIMERIX INC CMRX US 26.3 (2.1) 15.9 CHOICE HOTELS CHH US 562.7 (520.0) 75.1 CIENA CORP CIEN US 1,693.3 (97.9) 744.0 CINCINNATI BELL CBB US 2,151.5 (727.8) (93.4) DELTA AIR LI DAL US 45,772.0 (1,184.0) (5,880.0) DENDREON CORP DNDN US 639.0 (35.9) 339.3 DEX MEDIA INC DXM US 2,658.8 (17.7) (13.5) DIAMOND RESORTS DRII US 1,053.8 (99.1) 674.4 DIRECTV DTV US 20,921.0 (5,688.0) 622.0 DOMINO'S PIZZA DPZ US 468.8 (1,328.8) 73.7 DUN & BRADSTREET DNB US 1,902.0 (1,097.0) (194.9) DYAX CORP DYAX US 70.7 (37.0) 43.0 ESPERION THERAPE ESPR US 5.3 (5.0) 2.4 EVERYWARE GLOBAL EVRY US 340.7 (53.6) 134.8 FAIRPOINT COMMUN FRP US 1,656.5 (360.7) 5.5 FAIRWAY GROUP HO FWM US 338.5 (1.2) 5.8 FERRELLGAS-LP FGP US 1,440.6 (29.0) 9.9 FIFTH & PACIFIC FNP US 826.3 (170.2) (17.7) FOREST OIL CORP FST US 1,895.0 (104.8) (127.8) FREESCALE SEMICO FSL US 3,129.0 (4,583.0) 1,235.0 GENCORP INC GY US 1,411.1 (366.9) 27.9 GLG PARTNERS INC GLG US 400.0 (285.6) 156.9 GLG PARTNERS-UTS GLG/U US 400.0 (285.6) 156.9 GLOBAL BRASS & C BRSS US 576.5 (37.0) 286.9 GOLD RESERVE INC GDRZF US 78.3 (25.8) 56.9 GOLD RESERVE INC GRZ CN 78.3 (25.8) 56.9 GRAHAM PACKAGING GRM US 2,947.5 (520.8) 298.5 HALOGEN SOFTWARE HGN CN 22.8 (46.2) (9.4) HCA HOLDINGS INC HCA US 27,934.0 (7,485.0) 1,771.0 HD SUPPLY HOLDIN HDS US 6,459.0 (1,720.0) 1,199.0 HOVNANIAN ENT-A HOV US 1,618.9 (478.5) 929.3 HUGHES TELEMATIC HUTC US 110.2 (101.6) (113.8) HUGHES TELEMATIC HUTCU US 110.2 (101.6) (113.8) INCYTE CORP INCY US 334.2 (27.8) 210.4 INFOR US INC LWSN US 5,846.1 (480.0) (306.6) INSYS THERAPEUTI INSY US 22.2 (63.5) (70.0) INVIVO THERAPEUT NVIV US 13.8 (14.3) (15.3) IPCS INC IPCS US 559.2 (33.0) 72.1 ISTA PHARMACEUTI ISTA US 124.7 (64.8) 2.2 JUST ENERGY GROU JE US 1,528.9 (164.9) (62.3) JUST ENERGY GROU JE CN 1,528.9 (164.9) (62.3) L BRANDS INC LTD US 5,776.0 (994.0) 634.0 LEE ENTERPRISES LEE US 1,010.8 (104.9) (6.9) LIN MEDIA LLC LIN US 1,221.8 (63.5) (97.2) LORILLARD INC LO US 3,335.0 (1,855.0) 1,587.0 MANNKIND CORP MNKD US 215.2 (146.8) (231.9) MARRIOTT INTL-A MAR US 6,377.0 (1,493.0) (1,063.0) MARRONE BIO INNO MBII US 17.8 (45.1) (21.6) MDC PARTNERS-A MDZ/A CN 1,389.4 (16.6) (204.5) MDC PARTNERS-A MDCA US 1,389.4 (16.6) (204.5) MEDIA GENERAL-A MEG US 734.7 (191.7) 38.1 MERITOR INC MTOR US 2,477.0 (1,059.0) 278.0 MERRIMACK PHARMA MACK US 127.3 (32.1) 58.4 MONEYGRAM INTERN MGI US 5,075.8 (148.2) 30.1 MORGANS HOTEL GR MHGC US 583.6 (148.2) 104.5 MPG OFFICE TRUST MPG US 1,450.5 (530.6) - NATIONAL CINEMED NCMI US 831.0 (308.8) 122.2 NAVIDEA BIOPHARM NAVB US 13.6 (2.7) 6.2 NAVISTAR INTL NAV US 8,723.0 (3,638.0) 1,562.0 NEKTAR THERAPEUT NKTR US 447.9 (2.6) 183.8 NPS PHARM INC NPSP US 188.5 (4.2) 133.4 NYMOX PHARMACEUT NYMX US 1.8 (7.4) (1.9) ODYSSEY MARINE OMEX US 28.0 (7.1) (15.5) OMEROS CORP OMER US 17.7 (15.9) 5.2 OMTHERA PHARMACE OMTH US 18.3 (8.5) (12.0) ORGANOVO HOLDING ONVO US 16.7 (5.3) (6.2) PALM INC PALM US 1,007.2 (6.2) 141.7 PDL BIOPHARMA IN PDLI US 312.8 (93.7) 189.9 PHILIP MORRIS IN PM US 37,140.0 (3,929.0) 2,049.0 PHILIP MRS-BDR PHMO11B BZ 37,140.0 (3,929.0) 2,049.0 PLAYBOY ENTERP-A PLA/A US 165.8 (54.4) (16.9) PLAYBOY ENTERP-B PLA US 165.8 (54.4) (16.9) PLY GEM HOLDINGS PGEM US 906.1 (343.4) 132.2 PROTECTION ONE PONE US 562.9 (61.8) (7.6) QUALITY DISTRIBU QLTY US 474.4 (42.0) 99.0 QUINTILES TRANSN Q US 2,426.7 (1,322.3) 217.5 REGAL ENTERTAI-A RGC US 2,451.8 (706.2) 117.1 RENAISSANCE LEA RLRN US 57.0 (28.2) (31.4) RENTPATH INC PRM US 208.0 (91.7) 3.6 REVLON INC-A REV US 1,269.7 (632.4) 180.6 RITE AID CORP RAD US 6,945.4 (2,357.5) 1,822.5 RURAL/METRO CORP RURL US 303.7 (92.1) 72.4 SALLY BEAUTY HOL SBH US 1,892.1 (280.5) 523.4 SILVER SPRING NE SSNI US 494.3 (104.0) 60.1 SINCLAIR BROAD-A SBGI US 2,734.5 (97.3) (18.2) SUNESIS PHARMAC SNSS US 50.6 (5.8) 15.3 SUNGAME CORP SGMZ US 0.1 (1.3) (1.4) SUPERVALU INC SVU US 4,691.0 (1,084.0) 2.0 TAUBMAN CENTERS TCO US 3,369.8 (191.4) - THRESHOLD PHARMA THLD US 104.5 (25.2) 80.0 TOWN SPORTS INTE CLUB US 414.5 (43.7) (14.3) ULTRA PETROLEUM UPL US 2,062.9 (441.1) (266.6) UNISYS CORP UIS US 2,275.8 (1,536.0) 412.2 VECTOR GROUP LTD VGR US 1,069.5 (129.5) 384.8 VENOCO INC VQ US 704.3 (299.9) (40.5) VERISIGN INC VRSN US 2,524.8 (273.9) 312.7 VIRGIN MOBILE-A VM US 307.4 (244.2) (138.3) VISKASE COS I VKSC US 334.7 (3.4) 113.5 WEIGHT WATCHERS WTW US 1,310.8 (1,561.1) (84.7) WEST CORP WSTC US 3,940.9 (850.2) 297.8 WESTMORELAND COA WLB US 933.6 (281.6) (11.1) XERIUM TECHNOLOG XRM US 600.8 (35.1) 123.8 XOMA CORP XOMA US 88.9 (0.9) 60.6 YRC WORLDWIDE IN YRCW US 2,200.9 (642.6) 111.1 ********* 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, Valerie Udtuhan, Howard C. Tolentino, Carmel Paderog, Meriam Fernandez, Ronald C. Sy, Joel Anthony G. Lopez, Cecil R. Villacampa, Sheryl Joy P. Olano, Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2013. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $975 for 6 months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Peter A. Chapman at 215-945-7000 or Nina Novak at 202-241-8200. *** End of Transmission ***