/raid1/www/Hosts/bankrupt/TCR_Public/130807.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, August 7, 2013, Vol. 17, No. 217
Headlines
1617 WESTCLIFF: Plan Outline Hearing Continued to Sept. 18
1617 WESTCLIFF: Hearing on Stay Motion Continued Until Aug. 19
ADAIR COUNTY HOSPITAL: Chapter 9 Case Summary and Creditors
388 ROUTE 22: Case Summary & 13 Unsecured Creditors
ALPHA NATURAL: Moody's Mulls Possible Downgrade of 'B1' CFR
AMERICAN AIRLINES: US Trustee Balks at $20MM CEO Payment
ANTIOCH COMPANY: Moran's Bid for Partial Summary Judgment Denied
ARCH COAL: Market Weakness Prompts Moody's Review for Downgrade
ARCHDIOCESE OF MILWAUKEE: Creditors Want Judge's Conflicts Probed
ARI-RC 3 LLC: Updated Case Summary & Creditors' Lists
AVANTAIR INC: Chapter 7 Trustee Appointed
B.A.P.K. REALTY: Case Summary & 2 Unsecured Creditors
BCP INTERNATIONAL: Case Summary & 11 Unsecured Creditors
CARDERO RESOURCES: Luxor Agrees to Restructure Notes
CARTER'S INC: Moody's Assigns Ba1 CFR & Rates $400MM Notes Ba2
CARTER'S INC: S&P Assigns BB+ Issuer Rating & $400MM Notes Rating
CHAPMAN COMMAND: Case Summary & 20 Largest Unsecured Creditors
COMMSCOPE HOLDINGS: Moody's Says Planned IPO is Credit Positive
CONVATEC HEALTHCARE: Moody's Alters 'B2' CFR Outlook to Negative
CONVATEC HEALTHCARE: S&P Rates, Then Withdraws 'B+' CCR
CONSOLIDATED TRANSPORT: Oct. 8 Hearing to Confirm Chapter 11 Plan
CSD LLC: Has Plan Consummated & Aug. 8 Admin. Claims Bar Date
DETROIT, MI: Workers Disagree on Having Retirees' Committee
DETROIT, MI: Retirees Win Seat at Table in Bankruptcy Filing
DETROIT, MI: Ch. 9 May Spell Trouble for Other Distressed Munis
DISCOVER BANK: Fitch Currently Rates Preferred Stock at 'B+'
DOCTORS HOSPITAL: MMA Funding Is "Bankruptcy Remote," Court Rules
DREAMWORKS ANIMATIONS: Moody's Assigns 'Ba2' Corp. Family Rating
DYNEGY INC: Danskammer Plant Sale Falls Through
EARL GAUDIO: Files List of 20 Largest Unsecured Creditors
EAST END: DJM Realty and GA Keen Approved as Real Estate Advisers
EASTMAN KODAK: Completes Syndication of $200MM Credit Facility
EASTMAN KODAK: Plan Draws More Objections from Shareholders
EASTMAN KODAK: Further Amends Rights Offering Procedures
EASTMAN KODAK: Unsecured Creditors Oppose Equity Committee
EXCEL MARITIME: Committee Says Competing Plan on the Way
EXIDE TECHNOLOGIES: Lead Victims Want Class Claim
FAIRMOUNT MINERALS: Moody's Rates $1.2-Billion Debt Facilities B1
FIRST STREET HOLDINGS: Hearing Today to Appoint Chapter 11 Trustee
FIRSTPLUS FINANCIAL: Accountant Cops Plea in Mafia Takeover
GRAND CENTREVILLE: Case Summary & 8 Unsecured Creditors
GREATER BETHEL: Case Summary & 20 Largest Unsecured Creditors
GREGORY WOOD: Can File Bankruptcy Plan Until Aug. 15
HART OIL: William Davis Can't Represent Chapter 11 Trustee
HEMISPHERE MEDIA: S&P Assigns 'B' CCR; Outlook Stable
HRK HOLDINGS: Got Exclusive Plan Filing Period Extn. to Aug. 30
HUB INTERNATIONAL: S&P Affirms 'B' CCR & Puts on Watch Negative
INSPIRATION BIOPHARMA: Files Liquidating Plan & Disclosures
INTERFAITH MEDICAL: Hospital in Brooklyn to Close Down
JEMSEK CLINIC: Blue Cross Suit Remains in Discovery Phase
KIDSPEACE CORP: Deadline to File Claims Set for Aug. 30
KIDSPEACE CORP: Wants Ombudsman Terminated, Fees & Expenses Capped
KIDSPEACE CORP: Ombudsman Seeks to Retain Bryan Cave as Counsel
KIT DIGITAL: Sues Content Solutions Owner Over $19MM Deal
LABELS UNLIMITE: Case Summary & 19 Largest Unsecured Creditors
LAKESHORE FRESH: Case Summary & 10 Unsecured Creditors
LEVEL 3 FINANCING: Moody's Rates New $815MM Term Loan 'Ba3'
LEVEL 3 FINANCING: S&P Rates $815-Mil. Secured Term Loan 'BB-'
LIBERTYVIEW LEVERAGE: Barclays Exploits Bankruptcy for $17MM
LIGHTSQUARED INC: Harbinger Sues Ergen, Sound Point et al.
MEDEX ASSOCIATES: Case Summary & 20 Largest Unsecured Creditors
MF GLOBAL: Chapter 11 Trustee Seeks $1 Million Success Fee
MICROSEMI CORP: S&P Raises Corp. Credit Rating to 'BB'
MUD KING: Plan Exclusivity Extended to Nov. 1
MURPHY OIL: Moody's Assigns 'Ba2' CFR & Rates $500MM Notes 'Ba3'
MURPHY OIL: S&P Assigns 'BB' CCR & Rates $500MM Notes 'BB'
NORTHEAST WIND II: Moody's Rates New $385-Mil. Debt 'Ba3'
NNN PARKWAY: Case Summary & 20 Largest Unsecured Creditors
NORTEL NETWORKS: Has Authority to Employ Punter as Pension Advisor
ORCHARD SUPPLY: Proposing Defective Bonuses, U.S. Trustee Says
OVERSEAS SHIPHOLDING: Exclusivity Extension Sought
PALIVODA WESTMORELAND: Case Summary & 4 Unsecured Creditors
PHARMACEUTICAL ALTERNATIVES: App. Ct. Rules on MMO Suit Dismissal
PICKERT DAIRY: Case Summary & 20 Largest Unsecured Creditors
PRM FAMILY: Asks $700,00 in DIP Financing; Sept. 5 Hearing Set
PRM FAMILY: Court Sets Hearing on Cash Collateral Motion
PROMMIS HOLDINGS: Sept. 16 General Bar Date for EC Debtors
QUALITY DISTRIBUTION: Incurs $31.1 Million Net Loss in Q2
QUANTUM CORP: Posts $3.4 Million Net Income in Fiscal Q1
QUANTUM FUEL: Effects 1-for-4 Reverse Stock Split
QUIGLEY CO: Confirmation Order Reaffirmed
R.I.K. REALTY: Case Summary & Unsecured Creditor
RADIOSHACK CORP: To Issue 16.7MM Shares Under 2013 Incentive Plan
REALAUCTION.COM LLC: Voluntary Chapter 11 Case Summary
RESIDENTIAL CAPITAL: Suit Over Mortgage Servicing Deal Tossed
RESIDENTIAL CAPITAL: Settles Class Suit Over "High-Cost" Loans
RESIDENTIAL CAPITAL: Settles $1.87BB Suit for $57.6MM
RESIDENTIAL CAPITAL: FGIC Fires Back at Freddie Mac Over Deal
REVLON CONSUMER: Colomer Purchase Prompts Moody's Downgrade Watch
REVSTONE INDUSTRIES: Metavation Seeks OK of Huron as CRO
REVSTONE INDUSTRIES: Metavation Hires McDonald as Special Counsel
REVSTONE INDUSTRIES: Metavation Hires Pachulski Stang as Counsel
REVSTONE INDUSTRIES: Creditors Balk at Pachulski Fee Allocations
RG STEEL: Seeks Court Authority to Hire APS International as Agent
RG STEEL: Wins Approval to Sell Asset to CH Maryland for $100,000
RG STEEL: Wins Court Approval to Settle EPA Claims
ROCKWELL MEDICAL: Incurs $11.8 Million Net Loss in Q2
ROTHSTEIN ROSENFELDT: Akerman Atty Tapped as Liquidation Trustee
REFCO INC: Judge Won't Revive Abetting Claims Against PwC
RG STEEL: To Settle With EPA For $20MM In Allowed Claims
RURAL/METRO CORP: Wins Approval of "First Day" Motions
RURAL/METRO CORP: List of 50 Largest Unsecured Creditors
RURAL/METRO CORP: Moody's Cuts CFR to Ca After Bankruptcy Filing
REVSTONE INDUSTRIES: US Trustee Slams Metavation's Quick Sale Plan
SAN BERNARDINO, CA: To Get Nevada Judge as Mediator
SAN DIEGO HOSPICE: Hires Foley & Lardner as Special Counsel
SBMC HEALTHCARE: Marty McVey Files Expedited Motion to Convert
SCICOM DATA: Files Voluntary Chapter 11 Bankruptcy Petition
SCOOTER STORE: Gets Nod to Continue Ch. 11 Under Own Power
SEANERGY MARITIME: Annual Shareholders' Meeting on Sept. 5
SHOTWELL LANDFILL: Hires Ball & Minor as Accountants
SIERRA NEGRA: Aug. 21 Hearing on Motion to Dismiss Case
SIERRA NEGRA: Aug. 21 Hearing on Adequacy of Plan Outline
SINCLAIR BROADCAST: Has $985 Million Deal with Allbritton
SOMERSET INC: Court Denies Sanctions Against State Insurance Fund
SONDE RESOURCES: Incurs C$4.9-Mil. Net Loss in Second Quarter
SOUND SHORE: Court Enters Corrected Final DIP Order
SOUND SHORE: Gets Nod for $54-Mil. Sale to Montefiore
SOUTHERN STATES: Moody's Rates $130MM Notes B2 & Affirms B1 CFR
SOUTHERN STATES: S&P Assigns 'B' Rating to $130MM 2nd-Lien Notes
STELLAR BIOTECHNOLOGIES: Obtains License to "C. diff" Technology
SUN BANCORP: Files Copy of Investor Presentation with SEC
SUNTECH POWER: CSL's Mike Nacson, GEM's Kurt Metzger Join Board
SUNWIN STEVIA: RBSM LLP Raises Going Concern Doubt
SW BOSTON: 1st Circ. Urged Not to Reinstate Ch. 11 Plan
T3 MOTION: Appeals NYSE's Delisting Determination
T-L CHEROKEE: Sept. 26 Hearing on Continued Cash Collateral Use
TARGETED MEDICAL: Stockholders Elect Four Directors
TITAN ENERGY: Posts $281,000 Net Income in Second Quarter
TOUSA INC: Ch. 11 Liquidation Plan Confirmed by Florida Judge
TRANS-LUX CORP: Extends Warrants Exercise Period to Aug. 16
TRIUS THERAPEUTICS: Inks Merger Agreement with Cubist Pharma
UNITEK GLOBAL: Closes Credit Amendment with Term Lenders
UPH HOLDINGS: Kelley Drye Okayed Creditors Committee's Counsel
UPH HOLDINGS: QSI Approved as Committee's Financial Advisor
UPH HOLDINGS: Authorized to Sell Assets to TNCI Operating
UPH HOLDINGS: Wants Until Sept. 23 to File Chapter 11 Plan
USA BROADMOOR: Sept. 4 Hearing on Final Approval of Plan Outline
USA BROADMOOR: Can Access Cash Collateral Until Oct. 31
USEC INC: Noble Group Equity Stake Down to 2% at July 31
VALLEY TIMBERS: Case Summary & 20 Largest Unsecured Creditors
VELATEL GLOBAL: Files Arbitration Proceeding vs. China Motion
VUZIX CORP: Underwriters Exercise Over-Allotment Option
VUZIX CORP: Selling 3.5 Million Common Shares at $2 Apiece
W.R. GRACE: Expects Appeals Court Ruling After Labor Day
WEST COAST METAL: Case Summary & 20 Largest Unsecured Creditors
WEST CORP: Reports $43.6 Million Net Income in Second Quarter
WESTINGHOUSE SOLAR: Incurs $555,000 Net Loss in Second Quarter
WESTMORELAND COAL: Lowers Net Loss to $622,000 in 2nd Quarter
WJO INC: Ch.11 Trustee Wants Co-Counsel on SWIF, MedRisk Matters
WORLD IMPORTS: Files List of 20 Top Unsecured Creditors
WORLD SURVEILLANCE: Inks Support Agreement with US Technik
WPCS INTERNATIONAL: Issues 275,742 Common Shares
WVSV HOLDINGS: Wants to Hire Udall Shumway as Special Counsel
XERIUM TECHNOLOGIES: S&P Keeps 'B' CCR & Alters Outlook to Stable
* BofA Argues Against Class-Action Loan Modification Suit
* SAC Seen Avoiding $14 Billion Death Penalty From U.S.
* Fitch: US Personal Bankruptcies Set to Drop for 3rd Straight Yr.
* Business Bankruptcies Down 30% Over 2012, Report Says
* N.Y. Resort Owners Charged With $96 Million Ponzi Fraud
* Tourre's Junior Staff Defense Seen Leading to Trial Loss
* Leveraged Loans Pass 2012 Level With Record Ahead
* Dodd-Frank Foes Could Devise Strategy From Failed Suit
* Fed's Raskin Is Chosen for Deputy Treasury Secretary
* Fed's Debit Card Swipe-Fee Rules Rejected by U.S. Judge
* Experts Discuss Alternatives to Chapter 11 Bankruptcy
* Upcoming Meetings, Conferences and Seminars
*********
1617 WESTCLIFF: Plan Outline Hearing Continued to Sept. 18
----------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California
continued to Sept. 18, 2013, at 2 p.m., the hearing to consider
adequacy of the Disclosure Statement explaining 1617 Westcliff
LLC's Chapter 11 Plan.
The Court approved a stipulation entered between the Debtor and
Wells Fargo Bank, N.A., as trustee for the Registered Holders of
Credit Suisse First Boston Mortgage Securities Corp., Commercial
Mortgage Pass-Through Certificates, Series 2004-C3, acting by and
through its special servicer, continuing the hearing on the
Disclosure Statement and related deadlines.
The stipulation also provides that the deadline for any interested
party to oppose or otherwise respond to the Disclosure Statement
will be 14 days prior to the hearing on the Disclosure Statement.
The parties had requested that the July 24 hearing be continued
until Aug. 28, at 2 p.m. or any later date which is convenient to
the Court's calendar.
The Plan
As reported in the Troubled Company Reporter on July 10, 2013, the
Debtor, through the liquidating plan, seeks to accomplish payment
of creditors in full by reorganizing its personal assets and
liabilities through the sale of its only substantial asset, a
commercial real property commonly known as 1617 Westcliff Drive,
in Newport Beach, California. The property, according to court
documents, is a mixed use, Class B building mostly occupied by
medical office space. It comprises 32,000 square feet of rentable
space in a single two-story building situated on approximately
1.56 acres of land in an up-scale commercial district of Newport
Beach.
The Debtor filed the plan of liquidation and disclosure statement
on July 1, 2013.
The Debtor is negotiating a settlement agreement with a former
tenant, which may result in payments to the Estate on account of
past-due rent: however, as long as Debtor owns the Property, those
payments will be the cash collateral of Wells Fargo Bank, N.A., as
Trustee for the Registered Holders of Credit Suisse First Boston
Mortgage Securities Corp., Commercial Mortgage Pass-Through
Certificates, Series 2004- C3, acting by and through its special
servicer, which holds a first-in-priority deed of trust secured by
the Property, and are unlikely to become available for
distribution to creditors.
The Plan proposes two means of paying all creditors in full:
(1) The Debtor will sell the Property, and the sale will close
on or before the effective date of the Plan, allowing Debtor to
pay all allowed claims in full on the Effective Date. If able to
close the sale on or before the Effective Date, the Debtor intends
to cure on the Effective Date all defaults with respect to the
Bank's note, thereby eliminating default interest on that claim.
The Debtor will pay any pre-payment fee on the Bank's claim which
is triggered by the sale. Under the Plan scenario, no claims will
be impaired.
(2) The Debtor will sell the Property, and the sale will close
after, but within 18 months of, the Effective Date, allowing the
Debtor to pay all allowed claims in full within 18 months of the
Effective Date. If the Debtor is unable to close the sale on or
before the Effective Date, then on the Effective Date the Receiver
will remain in possession of the Property: however, the Receiver
will be required to replace the current Property Manager with a
new professional property management entity. As the Debtor will
be unable to pay all allowed claims on the Effective Date in this
case, all claims will technically be impaired. However, all
claims will still receive payment in full, including interest.
Furthermore, because the Debtor will be unable to cure on the
Effective Date all defaults with respect to the Bank's note, the
Bank will be entitled to interest at the default rate on that
claim. The Bank will only be entitled to any pre-payment fee on
the Bank's claim if the sale closes on or before September 1,
2014, which is the maturity date of the loan.
D. Edward Hays, Esq. -- ehays@marshackhays.com -- and Sarah C.
Boone, Esq. -- sboone@marshackhays.com -- at MARSHACK HAYS LLP, in
Irvine, California, filed the Plan and Disclosure Statement on
behalf of the Debtor.
A full-text copy of the Disclosure Statement dated July 1, 2013,
is available at http://bankrupt.com/misc/1617WESTCLIFFds0701.pdf
About 1617 Westcliff
1617 Westcliff, LLC, filed a bare-bones Chapter 11 petition
(Bankr. C.D. Calif. Case No. 12-19326) on Aug. 2, 2012, in Santa
Ana, California. The Debtor estimated assets of $10 million to
$50 million and liabilities of $1 million to $10 million.
Bankruptcy Judge Mark S. Wallace oversees the case. D. Edward
Hays, Esq., at Marshack Hays LLP, serves as the Debtor's counsel.
1617 WESTCLIFF: Hearing on Stay Motion Continued Until Aug. 19
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California
continued until Aug. 19, 2013, at 2 p.m., the hearing to consider
a motion for relief from stay against the real property of 1617
Westcliff LLC.
Creditor Wells Fargo Bank, N.A., as trustee for the Registered
Holders of Credit Suisse First Boston Mortgage Securities Corp.,
Commercial Mortgage Pass-Through Certificates, Series 2004-C3,
requested for stay relief, as reported in the Troubled Company
Reporter on July 12, 2013.
About 1617 Westcliff
1617 Westcliff, LLC, filed a bare-bones Chapter 11 petition
(Bankr. C.D. Calif. Case No. 12-19326) on Aug. 2, 2012, in Santa
Ana, California. The Debtor estimated assets of $10 million to
$50 million and liabilities of $1 million to $10 million.
Bankruptcy Judge Mark S. Wallace oversees the case. D. Edward
Hays, Esq., at Marshack Hays LLP, serves as the Debtor's counsel.
The Debtor has filed a plan of liquidation and disclosure
statement dated July 1, 2013. Through the Plan, the Debtor seeks
to accomplish payment of creditors in full by reorganizing its
personal assets and liabilities through the sale of its only
substantial asset, a commercial real property commonly known as
1617 Westcliff Drive, in Newport Beach, California.
ADAIR COUNTY HOSPITAL: Chapter 9 Case Summary and Creditors
-----------------------------------------------------------
Debtor: Adair County Hospital District
dba Westlake Regional Hospital
fdba Westlake Cumberland Hospital
dba Westlake Primary Care
dba Edmonton Primary Care
dba Westlake Primary Care of Russell County
fdba Bergin's Surgical Clinic
dba Westlake Primary Care Family Practice
901 Westlake Dr
Columbia, KY 42728
Bankruptcy Case No.: 13-10939
Chapter 9 Petition Date: July 31, 2013
Court: Western District of Kentucky (Bowling Green)
Debtor's Counsel: David M. Cantor, Esq.
SEILLER WATERMAN LLC
462 S. 4th Street, Ste 2200
Louisville, KY 40202
Tel: 584-7400
E-mail: cantor@derbycitylaw.com
Scheduled Assets: $3,267,759
Scheduled Liabilities: $11,358,782
Affiliate that simultaneously sought Chapter 9 protection:
Debtor Case No.
------ --------
Adair County Public Hospital District Corporation 13-10940
Assets: $1,000,001 to $10,000,000
Debts: $10,000,001 to $50,000,000
A copy of Adair County Hospital District's list of 20 largest
unsecured creditors, filed together with the petition is available
for free at http://bankrupt.com/misc/kywb13-10939.pdf
A copy of Adair County Public Hospital's 20 largest unsecured
creditors, filed together with the petition is available for free
at http://bankrupt.com/misc/kywb13-10940.pdf
The petitions were signed by Neal M. Gold, vice chairman.
388 ROUTE 22: Case Summary & 13 Unsecured Creditors
---------------------------------------------------
Debtor: 388 Route 22 Readington Holdings, LLC
388 Route 22
Whitehouse, NJ 08888
Bankruptcy Case No.: 13-26699
Chapter 11 Petition Date: July 31, 2013
Court: United States Bankruptcy Court
District of New Jersey (Trenton)
Judge: Kathryn C. Ferguson
Debtor's Counsel: Morris S. Bauer, Esq.
NORRIS MCLAUGHLIN & MARCUS, PA
P.O. Box 5933
Bridgewater, NJ 08807-5933
Tel: (908) 722-0700
Fax: (908) 722-0755
E-mail: msbauer@nmmlaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 13 unsecured creditors, filed
together with the petition, is available for free at
http://bankrupt.com/misc/njb13-26699.pdf
The petition was signed by Lawrence S. Berger, manager.
Affiliates that filed separate Chapter 11 petitions:
Petition
Debtor Case No. Date
------ -------- ----
199 Realty Corp. 13-14776 03/07/13
Alsol Corporation 13-12689 02/11/13
Berley Associates, Ltd. 12-32032 09/05/12
Princeton Office Park, L.P. 08-27149 09/09/08
Route 88 Office Associates, Ltd 12-32431 09/11/12
SB Building Associates
Limited Partnership 13-12682 02/11/13
SB Milltown Industry Realty
Holdings, LLC 13-12685 02/11/13
Somerset Thor Building Realty
Holdings, LP 13-12660 02/11/13
ALPHA NATURAL: Moody's Mulls Possible Downgrade of 'B1' CFR
-----------------------------------------------------------
Moody's Investors Service placed all ratings of Alpha Natural
Resources, Inc. on review for possible downgrade, including the
company's B1 Corporate Family Rating, B1-PD Probability of Default
Rating, Ba1 rating on senior secured term loan, and the B2 rating
on senior unsecured debt. The rating action was prompted by recent
deterioration in performance and persistent weakness in market
conditions for both thermal and metallurgical coal.
Ratings Rationale:
The rating action was prompted by recent deterioration in
performance due to continuing weakness in the coal industry, and
Moody's view that if metallurgical coal prices persist at the
recent benchmark settlement price of $145 per ton, Alpha could be
compelled to make additional production cuts, leading to further
deterioration in performance in 2014. While Moody's acknowledges
Alpha's substantial current liquidity position of $1 billion of
cash and marketable securities and roughly $950 million available
under its revolving credit facility (subject to $300 million
minimum-liquidity requirement), persistent negative free cash
flows and tightening headroom under covenants could cause
substantial erosion in the liquidity cushion in 2014. Moody's
anticipates that in 2013, Alpha will generate roughly $350 million
in EBITDA (as adjusted by Moody's) and expend roughly $350 million
in capital expenditures, with negative free cash flows approaching
$250 million.
The review will focus on committed contracted position, cost
structure at the company's mines, capital investment needs for
2014, and potential actions that management may take should
metallurgical coal prices persist at current level.
Alpha Natural Resources is one of the largest coal companies in
the US, and the largest US producer and exporter of metallurgical
(met) coal. The company's operations are located in the Central
Appalachia (CAPP) and Northern Appalachia (NAPP) regions, as well
as the Powder River Basin (PRB). For the twelve months ended March
31, 2013, Alpha generated revenues of $6.4 billion on 104 million
tons sold, including 20 million tons of metallurgical coal. The
company also controls approximately 4.5 billion tons of coal
reserves and approximately 25-30 million tons of export terminal
capacity.
The principal methodology used in this rating was the Global
Mining Industry Methodology published in May 2009. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
AMERICAN AIRLINES: US Trustee Balks at $20MM CEO Payment
--------------------------------------------------------
Law360 reported that the U.S. trustee objected to AMR Corp.'s
second amended joint Chapter 11 plan, saying the plan
impermissibly provides a $20 million severance payment for the
company's CEO, reimbursement of legal expenses of indenture
trustees and an overly broad exculpation provision.
According to the report, U.S. Trustee Tracy Hope Davis' objection
came just one day after AMR announced that its creditors voted
"overwhelmingly" in favor of its reorganization plan, moving the
company one step closer to exiting bankruptcy and effectuating its
$11 billion merger with US Airways Group Inc.
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)
ANTIOCH COMPANY: Moran's Bid for Partial Summary Judgment Denied
----------------------------------------------------------------
District Judge Timothy S. Black denied the motion filed by Asha
Moran for partial summary judgment on Count Three of the civil
action, THE ANTIOCH COMPANY LITIGATION TRUST, W. TIMOTHY MILLER,
TRUSTEE, Plaintiff, v. LEE MORGAN, et al., Defendants, Case No.
3:10-cv-156 (S.D. Ohio). A copy of the Court's Aug. 2, 2013 Order
is available at http://is.gd/f8ZKshfrom Leagle.com.
Asha Morgan Moran moves for summary judgment on the Plaintiff's
breach of fiduciary duty claim regarding the Antioch Company's
purchase of a series of bonds to secure payment of promissory
notes Antioch issued to former employees in payment of their
retirement benefits. The Plaintiff alleges that the bonds did not
constitute "adequate security" for the ESOP Notes as required
under ERISA because the insurer selected to guarantee payment of
the notes was financially insecure.
Ms. Moran argues that summary judgment against the Plaintiff is
proper because: (1) its claims are preempted by ERISA; (2) there
is no evidence that the Company suffered damages, or that Ms.
Moran is linked to the events underlying Count Three; and (3) the
business judgment rule bars the Plaintiff's claim.
The Plaintiff maintains that the motion for summary judgment must
be denied because Ms. Moran's legal defenses lack merit and there
are genuine issues of material fact as to whether she breached her
fiduciary duties to the Company in approving premium payments to
the insurer, Condor, when it was known to be insolvent, and
authoring misleading letters to ESOP noteholders that covered up
the fact that the guaranty of their notes was worthless.
McDermott Will & Emery LLP, Interested Party, is represented in
the lawsuit by by Charles Joseph Faruki, Esq., and Jeffrey S.
Sharkey, Esq., at Faruki Ireland & Cox PLL.
Brian P. Muething, Esq., Danielle Marie D'Addesa, Esq., David
Thomas Bules, Esq., and Michael L. Scheier, Esq., at Keating
Muething & Klekamp, represent appellants Lee Morgan; Asha Morgan
Moran; Chandra Attiken; Marty Moran; Lee Morgan, GDOT 1; Lee
Morgan, GDOT Trust 2; Lee Morgan, GDOT Trust 3; Lee Morgan,
Pourover Trust 1; and Lee Morgan, Pourover Trust 2.
The Antioch Company Litigation Trust Company is represented by
Beth A. Silvers, Esq., and Marcia Voorhis Andrew, Esq., at Taft
Stettinius & Hollister.
Antioch Company Litigation Trust, W. Timothy Miller, Trustee,
Plaintiff, is also represented by Beth A. Silvers, Esq., Emily
Creditt McNicholas, Esq., and Marcia Voorhis Andrew, Esq., at Taft
Stettinius & Hollister.
Defendants Nancy Blair and Wayne Alan Luce are represented by
Terence Leslie Fague, Esq., and Daniel Jerome Gentry, Esq., at
Coolidge Wall Co., L.P.A.
Defendants Malte Von Matthiessen, Dennis Sanan, Ben Carlson and
Jeanine McLaughlin are represented by Jennifer L. Maffett, Esq.,
Scott Allen King, Esq., and Thomas Allen Knoth, Esq., at Thompson
Hine.
Defendant Candlewood Partners, LLC, represented by Kimberly A.
Brennan, Esq., and Michael Nelson Schaeffer, Esq., at Kemp
Schaeffer Rowe & Lardiere; and Robert R. Kracht, Esq., at
McCarthy, Lebit, Crystal & Liffman Co., L.P.A.
Robert Alan Klingler & Brian Joseph Butler represent Defendants
Steve Bevelhymer, Karen Felix, Kimberly Lipson-Wilson, Barry
Hoskins, and G. Robert Morris.
Defendant Houlihan, Lokey, Howard & Zukin, Inc., is represented by
Richard Alan Chesley, Esq., at DLA Piper LLP.
Defendant James Northrup is represented by R. Daniel Prentiss,
Esq., at R. Daniel Prentiss, P.C.
About The Antioch Company
St. Cloud, Minn.-based scrapbook company The Antioch Company and
six affiliates filed for Chapter 11 bankruptcy (Bankr. D. Minn.
Case No. 13-41898) in Minneapolis on April 16, 2013. Antioch
disclosed $10 million to $50 million in both assets and debts.
The affiliates that separate filed for Chapter 11 are Antioch
International-Canada LLC, Antioch International LLC, zeBlooms LLC,
Antioch Framers Supply LLC, Antioch International-New Zealand LLC,
and Creative Memories Puerto Rico, LLC.
Founded in 1926, Antioch and its affiliates make up one of the
world's preeminent suppliers of scrapbooks, related accessories,
and photo solutions for memory preservation through the direct
sales channel. The Debtors also go by business names Creative
Memories, Antioch, Agenda, Antioch Publishing, Cottage Arts, Frame
of Mind and Webway.
Antioch has 200 employees and currently has operations through the
Debtor companies and foreign subsidiaries in the United States,
Canada, Japan, Australia, and New Zealand. In 2012, the Company's
net revenue was approximately $93.8 million and it had a net loss
of $3.7 million.
Antioch previously sought bankruptcy protection in 2008 (Bankr.
S.D. Ohio Case No. 08-35741).
In the 2013 case, the U.S. Trustee appointed a seven-member
creditors committee.
ARCH COAL: Market Weakness Prompts Moody's Review for Downgrade
---------------------------------------------------------------
Moody's Investors Service placed all ratings of Arch Coal on
review for possible downgrade, including the company's B2
Corporate Family Rating, B2-PD Probability of Default Rating, Ba3
rating on senior secured credit facility, and the B3 rating on
senior unsecured debt. The rating action was prompted by recent
deterioration in performance and persistent weakness in market
conditions for both thermal and metallurgical coal.
Ratings Rationale:
The rating action was prompted by recent deterioration in
performance due to continuing weakness in the coal industry, and
Moody's view that if metallurgical coal prices persist at the
recent benchmark settlement price of $145 per ton, Arch could be
compelled to make additional production cuts, leading to further
deterioration in performance in 2014. Moody's acknowledges Arch's
substantial current liquidity position, with almost $900 million
in cash and marketable securities, roughly $300 million available
under revolver and securitization facilities (after excluding the
$450 million minimum-liquidity requirement), and roughly $400
million expected from the recent sale of its Canyon Fuel assets in
the Western Bituminous region. That said, persistent negative free
cash flows and tightening headroom under covenants could cause
substantial erosion in the liquidity cushion in 2014. Moody's
anticipates that in 2013, Arch will generate roughly $350 million
in EBITDA (as adjusted by Moody's) and expend roughly $300 million
in capital expenditures, with negative free cash flows approaching
$300 million.
The review will focus on committed contracted position, cost
structure at the company's mines, capital investment needs for
2014, and potential actions that management may take should
metallurgical coal prices persist at current level.
Arch Coal is one of the largest US coal producers which operate in
all of the major US coal basins. The company's production consists
mainly of low-sulfur thermal coal from its Power River Basin mines
and thermal and metallurgical coal from Appalachia. In 2012, the
company generated roughly $4 billion in revenues.
The principal methodology used in this rating was the Global
Mining Industry Methodology published in May 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.
ARCHDIOCESE OF MILWAUKEE: Creditors Want Judge's Conflicts Probed
-----------------------------------------------------------------
Annysa Johnson, writing for the Milwaukee-Wisconsin Journal
Sentinel, reported that just days after U.S. District Judge
Rudolph T. Randa issued a key ruling in favor of the Archdiocese
of Milwaukee in its bankruptcy, the church's creditors are seeking
an emergency order to determine whether Randa has a conflict of
interest that should have been disclosed.
According to the report, Randa has ruled that forcing the
archdiocese to tap the $50 million-plus it holds in a trust for
the perpetual care of cemeteries would substantially burden its
free expression of religion under the First Amendment and a 1993
federal law aimed at protecting religious liberty.
In a highly unusual move, lawyers representing the archdiocese's
creditors -- primarily sex abuse victims -- filed a motion asking
U.S. Bankruptcy Judge Susan V. Kelley to compel the release of any
records showing whether Randa and his wife, Melinda, have
purchased any plots or crypts in one of the archdiocese's
cemeteries, or whether they have any interest as heirs or
beneficiaries of several relatives known to be buried in them, the
report said.
Depending on what they find, the motion says, the lawyers say they
may seek to vacate Randa's order and ask him to recuse himself
from the case.
"Judge Randa's decision was so indefensible in so many ways that
we suspected there was reason to investigate any involvement he
might have with the cemeteries," said Marci Hamilton, a First
Amendment scholar who is representing the creditors committee on
the issue.
About Archdiocese of Milwaukee
The Diocese of Milwaukee was established on Nov. 28, 1843, and
was elevated to an Archdiocese on Feb. 12, 1875, by Pope Pius
IX. The region served by the Archdiocese consists of 4,758 square
miles in southeast Wisconsin which includes counties Dodge, Fond
du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth,
Washington and Waukesha. There are 657,519 registered Catholics
in the Region.
The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for
Chapter 11 bankruptcy protection (Bankr. E.D. Wis. Case No.
11-20059) on Jan. 4, 2011, to address claims over sexual abuse
by priests on minors.
The Archdiocese became at least the eighth Roman Catholic diocese
in the U.S. to file for bankruptcy to settle claims from current
and former parishioners who say they were sexually molested by
priests.
Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in
Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The
Official Committee of Unsecured Creditors in the bankruptcy case
has retained Pachulski Stang Ziehl & Jones LLP as its counsel, and
Howard, Solochek & Weber, S.C., as its local counsel.
The Archdiocese estimated assets and debts of $10 million to
$50 million in its Chapter 11 petition.
(Catholic Church Bankruptcy News; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000)
ARI-RC 3 LLC: Updated Case Summary & Creditors' Lists
-----------------------------------------------------
Lead Debtor: ARI-RC 3, LLC
2650 Ridge Rd
Steamboat Springs, CO 80487
Bankruptcy Case No.: 13-15108
Chapter 11 Petition Date: August 1, 2013
Court: United States Bankruptcy Court
Central District of California (San Fernando Valley)
Debtors' Counsel: John-patrick M Fritz, Esq.
LEVENE NEALE BENDER RANKIN ET AL
10250 Constellation Blvd Ste 1700
Los Angeles, CA 90067
Tel: (310) 229-1234
Fax: (310) 229-1244
E-mail: jpf@lnbrb.com
- and ?
Daniel H. Reiss, Esq.
LEVENE NEALE BENDER RANKIN ET AL
10250 Constellation Blvd Ste 1700
Los Angeles, CA 90067
Tel: (310) 229-1234
Fax: (310) 229-1244
E-mail: dhr@lnbyb.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
Affiliates that also sought Chapter 11 protection on Aug. 1, 2013:
Debtor Case No.
------ --------
ARI-RC 17, LLC 13-15109
Assets: $10,000,001 to $50,000,000
Debts: $10,000,001 to $50,000,000
ARI-RC 18, LLC 13-15111
Assets: $10,000,001 to $50,000,000
Debts: $10,000,001 to $50,000,000
ARI-RC 33, LLC 13-15112
Assets: $10,000,001 to $50,000,000
Debts: $10,000,001 to $50,000,000
ARI-RC 27, LLC 13-15113
Assets: $10,000,001 to $50,000,000
Debts: $10,000,001 to $50,000,000
ARI-RC 15, LLC 13-15115
Assets: $10,000,001 to $50,000,000
Debts: $10,000,001 to $50,000,000
ARI-RC 7, LLC 13-15116
Assets: $10,000,001 to $50,000,000
Debts: $10,000,001 to $50,000,000
ARI-RC 25, LLC 13-15117
Assets: $10,000,001 to $50,000,000
Debts: $10,000,001 to $50,000,000
ARI-RC 24, LLC 13-15118
Assets: $10,000,001 to $50,000,000
Debts: $10,000,001 to $50,000,000
ARI-RC 11, LLC 13-15126
Assets: $10,000,001 to $50,000,000
Debts: $10,000,001 to $50,000,000
ARI-RC 4, LLC 13-15129
Assets: $10,000,001 to $50,000,000
Debts: $10,000,001 to $50,000,000
ARI-RC 16, LLC 13-15131
Assets: $10,000,001 to $50,000,000
Debts: $10,000,001 to $50,000,000
ARI-RC 13, LLC 13-15133
Assets: $10,000,001 to $50,000,000
Debts: $10,000,001 to $50,000,000
ARI-RC 1, LLC 13-16587
Assets: $10,000,001 to $50,000,000
Debts: $10,000,001 to $50,000,000
The petitions were signed by R. Frederick Hodder, Jr. and Monroe
Sawhill Hodder, trustees.
Affiliates that sought Chapter 11 protection on Aug. 2, 2013:
Debtor Case No.
------ --------
ARI-RC 16, LLC 13-15131
ARI-RC 4, LLC 13-15129
ARI-RC 11, LLC 13-15126
ARI-RC 13, LLC 13-15133
Affiliates that sought Chapter 11 protection on July 15, 2013:
Debtor Case No.
------ --------
ARI-RC 12, LLC 13-14669
ARI-RC 14, LLC 13-14692
ARI-RC 21, LLC 13-14694
ARI-RC 23, LLC 13-14695
ARI-RC 6, LLC 13-14678
A. ARI-RC 3, LLC of its 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Patriot Air Systems $13,600
5251 Verdugo Way, Suite H
Camarillo, CA 93012
Southern Cal Edison $10,073
P.O. Box 6109-Credit
Covina, CA 91722
Jemm Investments $10,000
3636 Nobel Drive, #350
San Diego, CA 92122
California American Water $7,000
TNP Property Manager, LLC $4,977
Empire Building Services $4,928
Support Services of $4,720
America, Inc.
CAM Services $4,704
City of Thousand $1,955
Oaks Water
Red Hawk Fire & Security $680
Inland Pacific Roofing $650
Lighting Technology $581
Services
Arcadia Property Services $524
Inc.
Amtech Elevator Services $500
Waste Management-GI $389
Industries
Skyline Pest Control $255
Mr. Plant $195
Protection One $85
Verizon California $80
AT&T $20
B. A copy of ARI-RC 17, LLC's list of its 20 largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/cacb13-15109.pdf
C. A copy of ARI-RC 18, LLC's list of its 20 largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/cacb13-15111.pdf
D. A copy of ARI-RC 33, LLC's list of its 20 largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/cacb13-15112.pdf
E. A copy of ARI-RC 27, LLC's list of its 20 largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/cacb13-15113.pdf
F. A copy of ARI-RC 15, LLC's list of its 20 largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/cacb13-15115.pdf
G. A copy of ARI-RC 7, LLC's list of its 20 largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/cacb13-15116.pdf
H. A copy of ARI-RC 25, LLC's list of its 20 largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/cacb13-15117.pdf
I. A copy of ARI-RC 24, LLC's list of its 20 largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/cacb13-15118.pdf
J. A copy of ARI-RC 11, LLC's list of its 20 largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/cacb13-15126.pdf
K. A copy of ARI-RC 4, LLC's list of its 20 largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/cacb13-15129.pdf
L. A copy of ARI-RC 16, LLC's list of its 20 largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/cacb13-15131.pdf
M. A copy of ARI-RC 13, LLC's list of its 20 largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/cacb13-15133.pdf
N. A copy of ARI-RC 1, LLC's list of its 20 largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/cacb13-16587.pdf
AVANTAIR INC: Chapter 7 Trustee Appointed
-----------------------------------------
Law360 reported that a bankruptcy judge appointed an interim
Chapter 7 trustee for fractional aircraft ownership company
Avantair Inc., which was dragged into bankruptcy involuntarily by
creditors last month.
According to the report, U.S. Bankruptcy Judge Catherine Peek
McEwen granted the petitioning creditors' motion to appoint an
interim Chapter 7 trustee, tapping Tampa attorney Beth Ann
Scharrer for the job.
Judge McEwen also granted the creditors' request to shorten the
time Avantair has to fight the involuntary petition, the report
said. The company has until Aug. 6 to contest it, the report
added.
About Avantair Inc.
Headquartered in Clearwater, Fla., Avantair, Inc. (OTC BB: AAIR)
-- http://www.avantair.com/-- sells fractional ownership
interests in, and flight hour card usage of, professionally
piloted aircraft for personal and business use, and the management
of its aircraft fleet. According to AvData, Avantair is the fifth
largest company in the North American fractional aircraft
industry.
Avantair also operates fixed flight based operations (FBO) in
Camarillo, California and in Caldwell, New Jersey. Through these
FBOs and its headquarters in Clearwater, Florida, Avantair
provides aircraft maintenance, concierge and other services to its
customers as well as to the Avantair fleet.
For the nine months ended March 31, 2013, the Company incurred a
net loss attributable to common stockholders of $11.56 million on
$113.02 million of total operating revenue, as compared with a net
loss attributable to common stockholders of $5.43 million on
$131.51 million of total operating revenue for the same period a
year ago.
As of March 31, 2013, the Company had $78.25 million in total
assets, $125.11 million in total liabilities, $14.86 million in
series A convertible preferred stock, and a $61.72 million total
stockholders' deficit.
"If we cannot generate the required revenues and gross margin to
achieve profitability or obtain additional capital on acceptable
terms, we will need to substantially revise our business plan in
order to continue operations and an investor could suffer the loss
of a significant portion or all of his investment in our Company.
The factors described herein raise substantial doubt about our
ability to continue as a going concern," according to the
Company's quarterly report for the period ended March 31, 2013.
B.A.P.K. REALTY: Case Summary & 2 Unsecured Creditors
-----------------------------------------------------
Debtor: B.A.P.K. Realty Group, LLC
201 Carroll Island Road
Baltmore, MD 21220
Bankruptcy Case No.: 13-23021
Chapter 11 Petition Date: July 31, 2013
Court: United States Bankruptcy Court
District of Maryland (Baltimore)
Judge: Robert A. Gordon
Debtor's Counsel: Seth W. Diamond, Esq.
THE DIAMOND LAW GROUP, LLC
8613 Cedar Street, Second Floor
Silver Spring, MD 20910
Tel: (301) 565-5258
Fax: (301) 565-0233
E-mail: seth@thediamondlawgroup.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Company's two largest unsecured creditors, filed
together with the petition, is available for free at
http://bankrupt.com/misc/mdb13-23021.pdf
The petition was signed by Michael L. Archer, manager.
BCP INTERNATIONAL: Case Summary & 11 Unsecured Creditors
--------------------------------------------------------
Debtor: BCP International Limited
aka BCPI Limited
1940 Duke Street, Suite 200
Alexandria, VA 22314
Bankruptcy Case No.: 13-13582
Chapter 11 Petition Date: August 1, 2013
Court: U.S. Bankruptcy Court
Eastern District of Virginia (Alexandria)
Judge: Brian F. Kenney
Debtor's Counsel: Gregory H. Counts, Esq.
TYLER, BARTL, RAMSDELL & COUNTS, PLC
300 North Washington Street, Suite 202
Alexandria, VA 22314-4252
Tel: (703) 549-7178
Fax: (703) 549-5011
E-mail: gcounts@tbrclaw.com
Scheduled Assets: $493,051
Scheduled Liabilities: $2,406,623
A copy of the Company's list of its largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/vaeb13-13582.pdf
The petition was signed by Christopher McHale, general counsel.
CARDERO RESOURCES: Luxor Agrees to Restructure Notes
----------------------------------------------------
Luxor Capital Group and its affiliates on Aug. 6 disclosed that
immediately after it became aware of a proposed financing of
Cardero Resources Corp. Luxor sent the following letter to the
board of directors of Cardero:
To the Board of Directors of Cardero:
In response to [Tuesday] morning's announcement with respect to
the proposed transaction with Mr. Robert Kopple, we write to
inform you that Luxor Capital Group, LP and its affiliates are
willing to offer Cardero far superior terms to restructure our
existing secured notes. As part of this process, Luxor, without
prejudice to all existing rights it may currently have, would
agree to stay any defaults under its existing secured notes. Our
agreement to stay would terminate if the Kopple Notes close.
Further, if the Board of Directors should deem the restructuring
of the Luxor Notes undesirable, Luxor would agree to tender for
all the outstanding shares of Cardero.
Background to Kopple Note Issuance
We are surprised that you took the extraordinary measure of
issuing 43% of the company in warrants (that re-strike lower as
the stock goes lower) for a note that matures in large part in
less than five months. Even more surprising is that you took such
an extraordinary step without once contacting Luxor to see if
better terms could be achieved (which we assure you they could
have). The only logical conclusion to be drawn from such a
dilutive security that adds just $2 million of real capital to
Cardero is that management is taking this self-inflicted moment of
distress to further entrench itself. As the largest current
shareholder of Cardero, the Kopple Notes will ensure that the only
people who make money in Cardero going forward are Mr. Kopple and
the insiders of Cardero.
Luxor has become aware from vendors of Cardero that Cardero is out
trying to renegotiate millions of dollars of past due payables,
offering creditors cents on the dollar for their claims and
threatening bankruptcy if such haircuts cannot be achieved. We
wonder, as 100% of the proceeds of the Kopple Notes will go to
repay the Luxor Notes, how management plans to deal with not only
the millions of dollars of overdue payables that it admits it
cannot pay but also, the $3.7 million amortization payment of the
Kopple Notes in December 2013. Of course, this also excludes
funds to run the business and attempt to advance the Carbon Creek
project. The only possible answer is more and more highly
dilutive equity.
These Kopple Notes are a literal death sentence for existing
common shareholders, of which we are the largest. We demand you
terminate the closing of the Kopple Notes and entertain one of our
offers.
Restructure the Luxor Notes
Luxor is willing to restructure the Luxor Notes on terms more
favorable to Cardero and its shareholders and other stakeholders
than the financing terms proposed under the Kopple Notes. As part
of the restructuring, Luxor would:
(i) change the maturity schedule of the Luxor Notes to match those
of the Kopple Notes;
(ii) waive any existing defaults under the Luxor Notes; and
(iii) agree to amend the terms of the Luxor Notes to position
Cardero so that it will not be in default on a go-forward basis.
For this, Luxor will require common share purchase warrants,
exercisable at US$0.10 each, for that number of shares which after
exercise of the warrants represent 30% of the then issued common
shares.
This proposal is far superior to the Kopple proposal for the
following reasons:
(i) the strike price of $0.10 on the warrants is 42% higher than
the Kopple strike price, resulting in more proceeds to the company
upon exercise of the warrants
(ii) the strike price is fixed, unlike the Kopple warrants which
have a strike price that goes down with the market price of the
stock; and
(iii) the exercise of the warrants will result in 13% less
dilution to common shareholders.
Luxor will agree to the same ownership limits as in the Kopple
proposal and all other material terms in the Kopple Notes. Luxor
will also require a Board seat. If the Board of Directors of
Cardero chooses this option, Luxor is committed to having
definitive documentation completed immediately, literally within a
matter of hours.
Tender Offer by Luxor
Alternatively, Luxor would immediately launch a takeover
bid/tender offer for all of the issued common shares of Cardero
for a cash price of CD$0.13, representing an 85% premium to the
closing price as of August 5, 2013. The Luxor offer would not
have any financing or due diligence conditions. Luxor would
forebear any defaults under the Luxor Notes while the Luxor offer
was open for acceptance. If the Board would prefer, this offer
could be done by way of a Plan of Arrangement.
As the largest single shareholder currently of Cardero, we assure
you, failure to consider either of these options and a decision to
close the Kopple Notes will result in immediate legal action
against the Board of Directors of Cardero. Other than the self-
preservation of management and the Board of Directors, there is no
justification for going forward with the Kopple Notes under far
inferior terms rather than to pursue either of the options
presented.
Luxor is ceasing to file reports under Part 4 of National
Instrument 62-103 - The Early Warning System and Related Take-Over
Bid and Insider Reporting Issues due to a change in its
eligibility for use of Part 4 due to the possible take-over bid
described above. This is a change in the facts set out in section
5 of Luxor's report under Part 4 of 62-103 dated May 10, 2013.
Luxor currently holds 10,198,173 commons shares in the capital of
Cardero representing a security holding percentage of 10.8% of the
issued and outstanding common shares of Cardero. Together with
Luxor's exposure to Cardero through a total return swap, its
percentage holdings are 11.08%. Luxor has control but not
ownership of such common shares.
Headquartered in Vancouver, Canada, Cardero Resource Corp. --
http://www.cardero.com-- is an exploration-stage company. The
Company holds, or has rights to acquire, interests in mineral
properties in Argentina, Mexico, Peru, the United States, Ghana
and Canada. The Company is in the process of evaluating, such
properties through exploration programs or, in some cases,
mineralogical and metallurgical studies and materials processing
tests. On June 1, 2011, the Company completed the acquisition of
Coalhunter Mining Corporation (Coalhunter). On September 14,
2011, Coalhunter changed its name to Cardero Coal Ltd. Coalhunter
has entered into various agreements to explore and, if warranted,
develop, certain coal deposits in the Peace River Coal Field
located in the northeast region of British Columbia.
CARTER'S INC: Moody's Assigns Ba1 CFR & Rates $400MM Notes Ba2
--------------------------------------------------------------
Moody's Investors Service assigned a Ba1 Corporate Family Rating
and a Ba1-PD Probability of Default Rating to Carter's, Inc.
Moody's also assigned a Ba2 rating to the proposed offering of
$400 senior notes to be issued by its wholly owned subsidiary The
William Carter Company. A Speculative Grade Liquidity rating of
SGL-1 was also assigned. The rating outlook is stable.
Carter's intends to utilize the proceeds of the notes offering to
return capital to shareholders through share repurchases and/or
dividends, and for general corporate purposes.
The following ratings were assigned:
Carter's, Inc.
Corporate Family Rating at Ba1
Probability of Default Rating at Ba1-PD
Speculative Grade Liquidity rating at SGL-1
The William Carter Company
$400 million senior unsecured notes due 2021 at Ba2 (LGD 5, 72%)
Ratings Rationale:
Carter's Ba1 Corporate Family Rating reflects the company's strong
market position in the infant apparel market through its
"Carter's" brand and participation in younger children's clothing
under the "OshKosh" brands. The Carter's brand (including sub-
brands that are distributed at Wal-Mart and Target) has
significant market share in the infant apparel market, with
products broadly distributed at mass market retailers, national
chains and department stores. Carter's also has a meaningful
direct-to-consumer business through its retail stores, its rapidly
growing online business, and a growing international store base,
primarily in Canada and Japan. Leverage, proforma for the proposed
transaction, is modest with debt/EBITDA near 2.75 times and
Moody's expects Carter's will maintain conservative financial
metrics. While the company has a narrow product focus, Moody's
believes that infant and toddler apparel is relatively more stable
than other apparel categories as there is a need for regular
purchases as children grow. The ratings are constrained by the
company's high reliance on a few key accounts for a significant
part of its wholesale business, and the inconsistent performance
of the OshKosh brand, which has incurred operating losses (before
corporate expenses) in the past two fiscal years.
The Ba2 rating assigned to the senior unsecured notes reflects
their junior ranking positive vis-…-vis the company's $375 million
senior secured revolver which has a first lien on substantially
all domestic assets of the company.
The Speculative Grade Liquidity rating of SGL-1 reflects Moody's
expectations that Carter's will maintain a very good liquidity
profile. The company's cash balances totaled more than $312
million as of June 29, 2013 and it also had a further $174 million
available to be drawn under its $375 million secured revolver.
Moody's expects the company to maintain sizable cash balances even
as it incurs sizable capital expenditures (around $200 million) in
the current fiscal year and normal seasonal working capital
requirements. The company has access to a $375 million credit
facility available in the US and Canada and Moody's expects the
company to maintain borrowings under this facility around current
levels. The secured revolver contains financial covenants which
Moody's expects will be maintained with ample covenant cushion.
The stable rating outlook reflects Moody's expectations the
company will continue to maintain share and high operating margins
within its Carter's brands while continuing to invest in growth
initiatives such as its online business and owned international
stores. The stable rating also reflects expectations the company
will maintain conservative financial policies in line with its
stated objectives
Ratings could be upgraded if the company were able to sustain its
growth initiatives at Carter's and meaningfully improve the
performance of its OshKosh brand. Quantitatively ratings could be
upgraded if Carter's sustained debt/EBITDA below 3 times and
interest coverage above 5.5 times with adjusted operating margins
sustained in the mid-teens. Further rating momentum toward
investment grade is also constrained by the meaningful amount of
secured debt in the company's capital structure.
Ratings could be downgraded if the company were to experience
unexpected operating challenges as it grows its online and
international businesses or if the company's financial policies
were to become more aggressive. Quantitatively ratings could be
lowered if debt/EBITDA was sustained above 3.75 times or if the
company's very good liquidity profile were to meaningfully erode.
Headquartered in Atlanta, Georgia, Carter's owns the "Carter's"
and "OshKosh B'gosh" brands which are distributed through
department stores, national chains and specialty retailers
domestically and internationally. Products are also sold through
more than 600 company-operated stores and through ecommerce sites.
The "Just One You", "Precious Firsts" and "Genuine Kids" brands
are available at Target and the "Child of Mine" brand is available
at Wal-Mart. LTM revenues are near $2.5 billion.
The principal methodology used in this rating was the Global
Apparel Industry Methodology published in May 2013. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
CARTER'S INC: S&P Assigns BB+ Issuer Rating & $400MM Notes Rating
-----------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its 'BB+'
issue-level rating on Carter's Inc.'s proposed $400 million senior
unsecured notes due 2021, issued at The William Carter Co. The
recovery rating on the notes is '3', indicating S&P's expectation
of meaningful recovery (50% to 70%) in a default scenario.
"We expect the proceeds of the proposed transaction to fund share
repurchases and/or dividends, and for general corporate purposes.
We estimate pro forma leverage to increase to about 2.7x from
about 1.7x, prior to the transaction. Credit metrics had been
strong for the rating, and despite the increase in leverage,
credit measures remain in line with the indicative ratios for an
"intermediate" financial risk profile, which includes leverage
below 3x. We expect credit metrics to remain relatively stable
over the next year, including leverage near the 2.7x pro forma
level. This is supported by our expectation of continued positive
operating performance with good growth particularly from the
direct-to-consumer (retail and e-commerce) and international
segments, and steady margins (which have increased from lower
product costs over the past year)," S&P said.
The ratings on Carter's reflects S&P's view that the company
continues to have an intermediate financial risk profile, based on
the company's conservative financial policy, good cash flow
generation, and adequate liquidity. The ratings also reflect the
company's "fair" business risk profile, which is supported by the
company's good market position in the young children's apparel
industry in the U.S., well recognized brands and its limited
geographic diversity. For the complete rating analysis, please
refer to S&P's research analysis on Carter's Inc. published on
March 20, 2013, on RatingsDirect.
RATINGS LIST
Carter's Inc.
Corporate credit rating BB+/Stable/--
New Ratings
The William Carter Co.
Senior unsecured
$400 mil. notes due 2021 BB+
Recover rating 3
CHAPMAN COMMAND: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Chapman Command Center, Inc.
dba C3 Location Systems, Inc.
941 Clint Moore Road
Boca Raton, FL 33487
Bankruptcy Case No.: 13-28394
Chapter 11 Petition Date: August 1, 2013
Court: U.S. Bankruptcy Court
Southern District of Florida (West Palm Beach)
Judge: Erik P. Kimball
Debtor's Counsel: Craig I. Kelley, Esq.
KELLEY & FULTON, PL
1665 Palm Beach Lakes Boulevard, #1000
West Palm Beach, FL 33401
Tel: (561) 491-1200
E-mail: cik@kelleylawoffice.com
Scheduled Assets: $1,057,844
Scheduled Liabilities: $3,712,382
The Company's list of its 20 largest unsecured creditors filed
with the petition is available for free at:
http://bankrupt.com/misc/flsb13-28394.pdf
The petition was signed by Robert W. Chapman, CEO.
COMMSCOPE HOLDINGS: Moody's Says Planned IPO is Credit Positive
---------------------------------------------------------------
Moody's says CommScope Holdings, Inc.'s (B2 stable) recent S-1
filing laying out a potential initial public equity offering would
be a favorable credit development and could ultimately help drive
a ratings upgrade.
CommScope Inc., headquartered in Hickory, North Carolina, is a
leading global provider of connectivity and infrastructure
solutions targeted towards cable and telecom service providers as
well as the enterprise market. The company had LTM revenues of
$3.5 billion for the twelve month period ended June 30, 2013.
CONVATEC HEALTHCARE: Moody's Alters 'B2' CFR Outlook to Negative
----------------------------------------------------------------
Moody's Investors Service has changed to negative from stable the
outlook on the B2 corporate family rating of ConvaTec.
Concurrently, Moody's has assigned a provisional (P)Caa1
instrument rating (with a loss given default (LGD) assessment of
LGD6, 91%) to the planned issuance of around $800 million of
HoldCo senior notes.
Moody's has also assigned a B2 CFR and B2-PD probability of
default rating (PDR) to ConvaTec Healthcare A S.a.r.l.
(Luxembourg, "CvT A" or "the company"), which, in the corporate
structure, is one level higher than ConvaTec Healthcare B S.a.r.l.
(CvT B) to better account for the economic cost of the planned
Holdco note issuance, which is outside of the restricted group. In
addition, Moody's will subsequently withdraw CvT B's B2 CFR and
B2-PD PDR and has affirmed its subsidiaries secured senior bank
facilities at Ba3 (LGD2, 24%). Furthermore, the rating agency has
upgraded ConvaTec Healthcare E S.A.'s senior unsecured notes to B3
(LGD5, 71%) from Caa1 (LGD5, 85%).
The proceeds of the proposed $800 million HoldCo note issuance
will be used to fund a dividend to shareholders via part
redemption of outstanding preferred equity certificates (PEC).
Ratings Rationale:
Change of Outlook on B2 CFR To Negative:
The negative rating outlook reflects the relative weak positioning
of the current B2 rating in the short term due to the company's
high leverage and lack of track record of the sustainability of
current and forecast trading levels. The outlook also reflects the
aggressive financial policies of ConvaTec's shareholders, which
has resulted in repeated releveraging of the business over recent
years, either via acquisitions or as currently proposed via a
significant dividend payment. Moody's also notes negatively the
significant additional cash burden and slower deleveraging profile
that the proposed HoldCo note issuance would create, hence the
negative outlook. Moody's would only consider stabilizing the
rating outlook if the company achieves the expected performance
for 2013.
Affirmation of B2 Rating:
The affirmation of ConvaTec's B2 CFR reflects the company's strong
current and forecast levels of trading, expected attractive levels
of free cash flow generation and good liquidity position. Moody's
further expects that, in line with management guidance, the
company will no longer incur material restructuring costs and that
acquisition activity, if any, will be limited to small bolt-on
transactions.
However, the rating remains constrained by ConvaTec's high
leverage, estimated at around 6.2x at the end of March 2013,
increasing to 7.8x pro forma for the proposed issuance of $800
million of HoldCo notes. Moody's expects the company's leverage
metrics to improve materially by end of 2013, supported by
improved current trading, a lack of material restructuring costs
and the application of free cash flows to debt reduction. Such
improvements would result in leverage decreasing below 7.0x, even
when including the new HoldCo notes. However, Moody's remains
cautious about the sustainability of current trading levels and
the company's ability to further expand its already high EBITDA
margins (above 30% as per March 2013).
Assignment of (P)Caa1 To Proposed Holdco Notes And Move Of The
Corporate Family Rating to ConvaTec Healthcare A Sarl:
The proposed HoldCo notes will be issued by an entity which is
above the top company (CvT B) of the restricted group. Therefore
debt and leverage within the restricted group will remain
unaffected. However, through the recently softened restricted
payment test, which allows for the payment of dividends out of the
restricted group to CvT A if the (reported) net leverage of the
restricted group is below 5.5x, Moody's believes that payments are
easily possible, except in a scenario of significantly weakening
operating performance. Consequently, with PIK payments becoming a
third-party cash obligation for CvT B, rather than an option for
shareholders to pay, Moody's believes that moving the corporate
family rating to the CvT A level would better reflect the economic
reality of the group's overall higher debt level and actual debt
service costs. With the CFR remaining unchanged at B2, and given
the increased loss cushion resulting from the issuance of the
structurally subordinated HoldCo notes, the rating for the
existing senior unsecured notes has been upgraded by one notch to
B3 and PIK is assigned Caa1.
In line with expected changes to the PEC documentation, Moody's
will continue to treat the remaining PECs will as equity under its
updated methodology on treating hybrid instruments.
Moody's views ConvaTec's liquidity position as good. In addition
to the $170 million of cash balances as of March 2013, the company
has access to a $250 million undrawn revolver and is expected to
generate positive free cash flow despite dividends to service the
HoldCo notes. Headroom under both financial covenants (leverage
and interest coverage) remains comfortable.
What Could Change The Rating Up/Down
For Moody's to consider a rating upgrade to B1, ConvaTec would
need to (1) deliver sustained deleveraging towards 5.5x
debt/EBITDA; (2) achieve FCF/debt that is trending towards 5%; and
(3) maintain an EBITDA margin in the high twenties in percentage
terms.
Moody's could consider rating downgrade to B3 if ConvaTec leverage
remains sustainably above 7.0x. Aggressive debt-funded acquisition
activity, a weakening of the company's liquidity profile and/or
sizeable restructuring costs could also be triggers for downgrade.
Principal Methodology
The principal methodology used in these ratings was the Global
Medical Product and Device Industry published in October 2012 and
Debt and Equity Treatment for Hybrid Instruments of Speculative-
Grade Nonfinancial Companies published in July 2013. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
ConvaTec Healthcare A S.a.r.l. is a leading developer,
manufacturer and marketer of innovative products for ostomy
management, advanced chronic and acute wound care, continence
care, sterile single-use medical devices for hospitals, and
infusion sets used in diabetes treatment infusion devices. The
company, which holds market leadership positions in a number of
its businesses, operates in over 100 countries, manufactures in 12
manufacturing sites and generated $1.652 billion of revenues and
EBITDA of $494 million (Moody's adjusted, trailing 12 months as
per end of 31 March 2013) through its total workforce of
approximately 8,000 employees worldwide.
CONVATEC HEALTHCARE: S&P Rates, Then Withdraws 'B+' CCR
-------------------------------------------------------
Standard & Poor's Ratings Services said it assigned its 'B+'
corporate credit rating to ConvaTec Healthcare B S.a.r.l., the
entity that issues financial statements, and withdrew the 'B+'
corporate credit rating on ConvaTec Inc. At the same time, S&P
assigned a 'B-' issue-level rating and '6' recovery rating to
ConvaTec Finance International S.A.'s $800 million PIK toggle
notes. S&P views the ConvaTec family on a consolidated basis.
Despite an increase in interest expense (the PIKs will be cash
pay, while the PECs being retired are not) and shortened, five-
year maturity, S&P views this event as credit neutral. Debt
leverage was 10.8x for the 12 months ended March 30, 2013,
including $2.7 billion of PECs, and will remains unchanged after
the transaction. ConvaTec was spun out from Bristol-Myers Squibb
Co. in 2008 and purchased by Nordic Capital and Avista Capital
Partners. "The 'B+' corporate credit rating reflects our
assessment of Luxembourg-based ConvaTec's business risk as
"satisfactory" and its financial risk as "highly leveraged"," said
credit analyst Cheryl Richer. "ConvaTec's satisfactory business
risk profile reflects the following: its product, geographic, and
customer diversity; leading market positions and strong and varied
customer relationships; and steady product demand."
"Our rating outlook on ConvaTec is stable, reflecting our
expectation that leverage will remain high despite improving
operating trends. Given an already highly leveraged capital
structure, we believe weakening liquidity could trigger a
downgrade. For example, a debt-financed acquisition that would
lower the company's EBITDA debt leverage covenant cushion to below
10% could precipitate a downgrade. We estimate that ConvaTec has
the capacity for an incremental $500 million of debt, without
factoring in accompanying EBITDA attributable to an acquisition,
at current ratings. We could raise the ratings if adjusted debt
leverage declines significantly (to under 5x), although we do not
expect this change unless the company replaces PECs with common
equity," S&P noted.
CONSOLIDATED TRANSPORT: Oct. 8 Hearing to Confirm Chapter 11 Plan
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Indiana,
according to Consolidated Transport Systems, Inc., et al.'s case
docket, will convene a hearing on Oct. 8, 2013, at 10:30 a.m., to
consider confirmation of the Debtors' Amended Joint Plan of
Reorganization dated July 5. Objections, if any, are due Sept. 3.
As reported in the Troubled Company Reporter on July 19, 2013, the
Amended Disclosure Statement provides that the Debtors'
obligations will be satisfied in full over time by the Debtors'
cash flow from operations, the disposition of the Debtors' tractor
fleet, and the exit financing.
The Plan proposes that the liabilities and assets of the Debtors
be substantively consolidated for the purposes of distributions
under the Plan. The Plan will be funded by the Reorganized
Debtors' (a) assumption of the DIP Financing; (b) entering into
the exit financing with Marquette, the Debtors' prepetition
receivables lender; (c) disposition of certain collateral pursuant
to a fleet disposition method; and (d) the operation of the
Reorganized Debtors' businesses, which will include the assumption
of certain executory contracts by the Debtors and their subsequent
assignment to the Reorganized Debtors.
A copy of the Amended Disclosure Statement is available for free
at http://bankrupt.com/misc/Consolidated_Transport_AMendedDS.pdf
The Court previously held a hearing to consider adequacy of
information in the original Disclosure Statement. According to
the Debtors' case docket, the Debtors were required to file an
Amended Disclosure Statement by July 5. A copy of the Original
Disclosure Statement is available for free at
http://bankrupt.com/misc/TANDEM_TRANSPORT_ds.pdf
About Consolidated Transport,
Tandem Transport et al.
Michigan City, Indiana-based trucking company Consolidated
Transport Systems, Inc., filed a Chapter 11 petition (Bankr. N.D.
Ind. Case No. 12-32940) on Aug. 16, 2012. Walter G & Carolyn Bay
owns 87.3% of the privately held Debtor.
Tandem Transport Corp., and two affiliates Transport Investment
Corporation, and Tandem Eastern, Inc., sought Chapter 11
protection (Bankr. N.D. Ind. Case Nos. 12-33135 to 12-33137) on
Aug. 31, 2012.
The Companies and their predecessors have provided for-hire
freight services throughout the United States since 1945. The
largest portion (75%) of the Companies' business consists of
hauling building materials, with the balance consisting of
transporting steel (20%) and other miscellaneous freight such as
stone, salt, and machinery (5%). The bulk of the Companies' loads
are received and delivered east of the Mississippi River, although
they have general commodities authority for the lower 48 states.
The Companies have intrastate authority for the states of Georgia,
Illinois, Indiana, Kentucky, Michigan, Missouri, North Carolina,
Ohio, Tennessee and Texas.
The Companies operate as a combined enterprise. Consolidated owns
the fleet of roughly 275 tractors and 330 trailers. It also
employs office staff of 66 employees. The corporate headquarters
is located in Michigan City, Indiana, while their executive office
is located in St. Louis, Michigan. Transport is the operating
company which provides logistics to customers and also brokers
freight. Eastern employs 246 drivers, while Investment employs 10
mechanics.
Consolidated initiated its chapter 11 proceeding to prevent any
actions by equipment lenders such as repossession of equipment
that would threaten the Companies' operations and viability while
they restructure their respective operations. Transport,
Investment and Eastern filed for chapter 11 to obtain the
necessary breathing room provided by the Bankruptcy Code, as well
as a single forum to allow them to effectively restructure their
operations.
Consolidated disclosed $17,207,923 in assets and $11,559,933 in
liabilities as of the Chapter 11 filing and affiliate, Tandem
Eastern, Inc., disclosed $40,652 in assets and $56,119 in
liabilities. Transport Investment estimated less than $50,000 in
assets and up to $50 million in liabilities. Two other entities
that filed are Transport Investment Corporation and Tandem
Eastern, Inc.
Judge Harry C. Dees, Jr. presides over the cases. Jeffrey J.
Graham, Esq., and Jerald I. Ancel, Esq., at Taft Stettinius &
Hollister LLP, in Indianapolis, Indiana, serve as the Debtors'
counsel. O'Keefe & Associates Consulting, LLC, as financial
advisors, The petition was signed by Jeffrey T. Gross, president.
CSD LLC: Has Plan Consummated & Aug. 8 Admin. Claims Bar Date
-------------------------------------------------------------
The confirmed Chapter 11 Plan of CSD, LLC, has been declared
effective on July 9, 2013. Accordingly, with this development,
the deadline for filing any motion seeking allowance of
administrative or professional claims is Aug. 8, 2013. The
deadline for filing objections to claims is Sept. 9, 2013.
About CSD LLC
Las Vegas, Nevada-based CSD, LLC, filed a Chapter 11 petition
(Bankr. D. Nev. Case No. 12-21668) on Oct. 12, 2012, estimating
$50 million to $100 million in assets and $10 million to
$50 million in debts. The petition was signed by Steven K.
Kennedy, manager of CSD Management, LLC, manager.
The Debtor owns 37.82 acres of land, seven houses, and an
equestrian facility, all located at 6629 S. Pecos Road, Las Vegas,
Nevada. The Debtor purchased the property from Mr. Wayne Newton
and his wife, Kathleen, for $19.5 million to develop and operate a
museum/tourist attraction honoring the life and career of Wayne
Newton. Situated on the purchased property is the current home of
the Newtons, known as "Casa de Shenandoah", which was to be used
to showcase Wayne Newton's memorabilia. The museum remains
unopened. DLH, LLC, which holds a 70% interest in the Debtor,
contributed nearly $60 million towards development of the museum.
DLH is a Nevada limited liability company, and its members are
Lacy Harber and Dorothy Harber.
Plans called for contributing $2 million toward the construction
of a new home for Mr. Newton on the acreage. The new home hasn't
been built, so Mr. Newton still lives in the existing home, paying
minimal rent.
While the Debtor has made substantial expenditures towards the
development of the Newton Museum, the Debtor and the Newtons have
been involved in certain disputes regarding the development of the
museum. The Debtor in May 2012 filed a lawsuit in Nevada state
court for fraud, civil conspiracy, and breach. The Newtons filed
counterclaims. Because of the deteriorating relationship of the
parties, it appears that it is no longer feasible for the parties
to move forward with the development of the museum.
On Aug. 9, 2012, the Debtor's committee members held an emergency
meeting and voted to dissolve the Debtor. Though the Debtor has
sought approval in the state court proceedings to dissolve, that
matter is not scheduled to be heard until May 2013.
Because the Debtor is out of money and options, and because the
Debtor's prepetition secured lender, Neva Lane Acceptance, LLC, is
unwilling to lend any additional funds to the Debtor on a
prepetition basis, the majority of the committee members voted in
favor of the bankruptcy filing. Although the Debtor is out of
cash, it claims that it has substantial equity in its property.
The Debtor has decided that a sale of the Debtor's property
pursuant to Section 363 of the Bankruptcy Code, followed by the
filing of a plan of liquidation, is the Debtor's best option for
maximizing the value of the property and maximizing the return to
the Debtor's creditors and interest holders.
James D. Greene, Esq., at Greene Infuso, LLP, in Las Vegas,
represents the Debtor. The Debtor's CRO is Odyssey Capital Group,
LLC.
DETROIT, MI: Workers Disagree on Having Retirees' Committee
-----------------------------------------------------------
Detroit, Michigan, filed with the bankruptcy court a request to
form an official committee for retired workers who otherwise have
no formal representative such as a labor union. The city wants an
official committee with which to conduct negotiations about
modification of retirement benefits.
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that several groups of retired workers told the judge not
to appoint any unions to the panel because they might have
conflicts of interest. The auto workers' union responded by
telling the judge he should mandate the appointment of any labor
union willing to serve.
Stepping into the middle, the U.S. Trustee filed papers reminding
the judge that discretion to select members of a committee is
lodged in the Justice Department's bankruptcy watchdog. The U.S.
Trustee takes the position that the judge has the power to modify
committee membership only after a committee is formed.
The report notes that there isn't even agreement on whether there
should be a committee at this stage. A newly formed group
representing retired police officers filed papers saying it's
premature to appoint a retirees' committee. The police retirees
don't want an official committee until the judge rules on whether
Detroit is eligible for Chapter 9 relief.
The report notes that by barring the appointment of a committee
early in the case, the city would be precluded from moving ahead
with litigation or negotiations on pension modifications.
The bankruptcy judge was slated to convene a hearing Aug. 2 on the
city's request.
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.
Detroit 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.
DETROIT, MI: Retirees Win Seat at Table in Bankruptcy Filing
------------------------------------------------------------
Nick Carey and Joseph Lichterman, writing for Reuters, reported
that in a high-stakes hearing in Detroit's bankruptcy filing, a
judge approved a city plan to form a creditors' committee of
retired workers, but gave unions and pension funds that opposed
the plan a measure of satisfaction by declaring an independent
trustee -- and not the city -- will select committee members.
According to the report, federal bankruptcy Judge Steve Rhodes'
ruling on the city's effort to create a new negotiating partner
independent of unions and pension funds was a key moment in a
three-hour session that packed the largest courtroom in Detroit's
downtown federal building. Rhodes also put off setting a date for
a hearing on Detroit's eligibility to file for bankruptcy, while
Detroit lawyers disclosed an ambitious aim to present a plan for
reorganization by the end of 2013.
Detroit, whose course in bankruptcy court is being set by a state-
appointed emergency manager, Kevyn Orr, set its target date at
least three months earlier than the March 2014 deadline Rhodes
previously had proposed, the report noted.
Outside of court, Orr also proposed a new healthcare plan for city
workers that would save Detroit $12 million annually by raising
deductibles and trimming the number of available plans, the report
said.
The next key step in the largest U.S. municipal bankruptcy case to
date will be for the judge to set a trial date on whether Detroit
is eligible for a Chapter 9 municipal bankruptcy, the report
further related. To remain in bankruptcy court, Detroit must
prove it is insolvent and has negotiated in good faith with
creditors owed more than $18 billion, or that there are too many
creditors to make negotiating feasible.
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: Ch. 9 May Spell Trouble for Other Distressed Munis
---------------------------------------------------------------
Kelly Nolan, writing for The Wall Street Journal, reported that a
Michigan county's decision to postpone a $53 million bond sale
highlights the difficulty fiscally strapped issuers everywhere may
face in the wake of Detroit's record bankruptcy filing, investors
said.
Portfolio managers say they are more cautious now about buying
bonds from local governments in Michigan and may demand higher
interest rates to lend them cash. Genesee County, Mich., on
Thursday shelved an offering after potential buyers wanted much
higher yields than the county was willing to pay, said people
familiar with the offering.
Saginaw County, however, says it plans to go ahead with a $60
million municipal-bond sale this week, even after neighboring
Genesee pulled its sale, the report said.
Still, some also say their leeriness extends beyond the state's
borders, to other local governments struggling with their finances
in the wake of the recession, the report noted. Indeed, some
investors say the Motor City's filing on July 18 acted as a fresh
reminder for them to look at all holdings again and reassess risk.
"With attention on Detroit, it only heightens attention . . . on
other distressed issuers," said Jim Colby, senior muni strategist
and portfolio manager at Van Eck Global, the report cited.
Investors should demand higher yields from these municipalities,
given the uncertainty surrounding Detroit's bankruptcy and how
much bondholders will ultimately get repaid, Mr. Colby said.
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.
DISCOVER BANK: Fitch Currently Rates Preferred Stock at 'B+'
------------------------------------------------------------
Fitch Ratings expects to rate Discover Bank's senior unsecured
notes 'BBB'. Discover Bank is a wholly owned subsidiary of
Discover Financial Services, with a long-term Issuer Default
Rating (IDR) of 'BBB'. The notes are expected to mature in August
2023. Issuance proceeds are expected to be used for general
corporate purposes.
Key Rating Drivers
Discover's Stable Rating Outlook reflects the expectation for
earnings consistency, peer-superior asset quality, and the
maintenance of strong liquidity and risk-adjusted capitalization.
While Discover will reduce capital ratios to its targeted range
over time, Fitch expects the bank to do this in a prudent manner.
Increased revenue diversity, proven competitive positioning and
credit performance in non-card loan categories over time, enhanced
funding flexibility and/or further clarity on regulatory and
legislative issues, particularly as it relates to the student loan
sector, could support positive rating momentum.
Conversely, negative rating action could be driven by a decline in
earnings performance, resulting from a decrease in market share or
credit deterioration, a weakening liquidity profile, significant
reductions in capitalization, and legislative and/or regulatory
changes that alter the earnings prospects of the credit card
and/or student loan businesses.
Negative rating momentum could also be driven by an inability of
Discover to maintain its competitive position and earnings
prospects in an increasingly digitized payment landscape. While
the company is focused on strategic acquisitions and alliances to
expand its online and mobile capabilities, competition from
technology companies and social networks, with access to
significant consumer data, is expected to intensify.
Discover is a leading credit card issuer and electronic payments
company that authorizes, processes, and guarantees the settlement
of cardholder transactions on the Discover, PULSE, and Diners Club
networks, and extends credit on a revolving basis to Discover
cardholders. The company had $62 billion in loan receivables at
June 30, 2013 and its stock is listed on the NYSE under the ticker
symbol DFS.
Fitch expects to assign the following rating:
Discover Bank
-- Senior unsecured debt 'BBB'.
Fitch currently rates Discover as follows:
Discover Financial Services
-- Long-term IDR 'BBB';
-- Short-term IDR 'F2';
-- Viability Rating 'bbb';
-- Senior debt 'BBB';
-- Preferred stock 'B+'
-- Support '5';
-- Support Floor 'NF'.
Discover Bank
-- Long-term IDR 'BBB';
-- Short-term IDR 'F2';
-- Viability Rating 'bbb';
-- Short-term deposits 'F2';
-- Long-term deposits 'BBB+';
-- Subordinated debt 'BBB-';
-- Support '5';
-- Support Floor 'NF'.
The Rating Outlook is Stable.
DOCTORS HOSPITAL: MMA Funding Is "Bankruptcy Remote," Court Rules
-----------------------------------------------------------------
The adversary complaint -- Gus A. Paloian, Chapter 11 Trustee of
Doctors Hospital of Hyde Park, Inc., Plaintiff, v. LaSalle Bank
National Association, f/k/a LaSalle National Bank, as Trustee for
Certificate Holders of Asset Securitization Corporation Commercial
Pass-Through Certificates, Series 1997, D5, by and through its
servicer, Orix Capital Markets, LLC Defendant, Adv. Proc. No.
02-A-00363 -- is before the U.S. Bankruptcy Court for the Northern
District of Illinois on remand after appeals to the U.S. Court of
Appeals for the Seventh Circuit by both parties from a judgment
entered after a first trial.
The 28-count complaint was filed against several defendants to
recover alleged fraudulent transfers made from October 1997 to
April 17, 2000. Counts VIII, IX, and X of the complaint asserted
claims only against LaSalle Bank National Association, as trustee
for certain mortgage certificates -- these counts serve as a
counterclaim to a $60.13 million claim LaSalle filed in March 2001
based on Doctors Hospital's guarantee obligations on a certain
loan.
After the first trial, it was held that the Plaintiff had proved
insolvency for the period August 1997 to April 2000, but judgment
was entered only as to fraudulent transfers of rent that Doctors
Hospital made directly to Defendant before July 1998.
At issue following remand is the holding that post-July 1998
rental payments were not fraudulent transfers. The remand order
sought further consideration of two issues -- one on Doctors
Hospital's insolvency and the other, on the status of MMA Funding
LLC.
In a Findings of Fact and Conclusions of Law dated July 17, 2013,
Bankrupcy Judge Jack B. Schmetterer found that:
(1) Doctors Hospital was insolvent at all times from September
30, 1999 through April 17, 2000, not earlier, and therefore
the sale in issue was effected prior to insolvency on March
31, 1997.
(2) MMA Funding, LLC was a valid bankruptcy remote entity at all
times from July 1998 onward.
(3) MMM Funding, LLC purchased the Hospital's receivables in a
true sale.
MMA Funding, LLC was created in 1997 to act as a special purpose
borrower on a loan from Daiwa-Healthco-2 LLC secured by Doctors
Hospital's accounts receivable, and entity whose assets were
asserted to be "bankruptcy remote," i.e., not to be administered
in a Doctors Hospital bankruptcy.
A copy of Judge Schmetterer's July 17, 2013 Findings is available
at http://is.gd/Vznutrfrom Leagle.com.
Doctors Hospital of Hyde Park is represented by John Costello,
Esq. -- jcostello@edwardswildman.com -- Scott A Semenek, Esq. --
ssemenek@edwardswildman.com -- Jeffrey L. Gansberg, Esq. --
jgansberg@edwardswildman.com -- John E. Frey, Esq. --
jfrey@edwardswildman.com -- and Yeny Estrada, Esq. --
yestrada@yedwardswildman.com -- of EDWARDS WILDMAN PALMER LLP.
LaSalle Bank is represented by Lewis T. Stevens, Esq., and Michael
Warner, Esq., of SIMON WARNER & DOBY LLP; David T.B. Audley, Esq.,
Michael T. Benz, Esq., of RICHARD WOHLLEBER, CHAPMAN AND CUTLER
LLP; and Howard L. Adelman, Esq., and Adam P. Silverman, Esq., of
ADELMAN, GETTLEMAN, MERENS, BERISH & CARTER, LTD.
N. Neville Reid, Esq. -- nreid@fslc.com -- of FOX, HEFTER, SWIBEL,
LEVIN & CARROLL LLP, serves as counsel for the Unsecured Creditors
Committee.
Stacy J. Flanigan, Esq., of WINSTON & STRAWN LLP, serve as counsel
for Dan K. Webb.
Kathryn M. Gleason, Esq., represent the Office of the U.S.
Trustee.
James M. Witz, Esq., and Frances Gecker, Esq., of FREEBORN &
PETERS, serve as counsel Stephen Weinstein.
Nancy A. Peterman, Esq., Jane B. McCullough, Esq., and Kimberly M.
DeShano, Esq., of GREENBURG TRAURIG PC, serve as counsel for Asset
Securitization Corp. and Nomura Asset Capital Corp.
About Doctors Hospital
Doctors Hospital of Hyde Park, Inc., filed for Chapter 11
protection (Bankr. N.D. Ill. Case No. 00-11520) on April 17, 2000.
On April 22, 2004, Gus A. Paloian, Esq., at Seyfarth Shaw LLP in
Chicago, was appointed the Chapter 11 trustee for Doctors
Hospital.
DREAMWORKS ANIMATIONS: Moody's Assigns 'Ba2' Corp. Family Rating
----------------------------------------------------------------
Moody's Investors Service assigned DreamWorks Animations SKG, Inc.
a Ba2 Corporate Family Rating, Ba2-PD Probability of Default
Rating, and a Ba3 (LGD5-76%) rating to its proposed $300 million
7-year senior unsecured notes. Proceeds from the new notes will be
used to pay down the $155 million outstanding balance on the
company's $400 million revolving credit facility, and for general
corporate purposes. Moody's also assigned the company a
Speculative Grade Liquidity rating of SGL-2. The rating outlook is
stable.
Assignments:
Issuer: DreamWorks Animation SKG, Inc.
Corporate Family Rating -- Ba2
Probability of Default Rating -- Ba2-PD
Senior Unsecured Notes -- Ba3 (LGD 5-76%)
Rating Rationale:
DreamWorks' Ba2 CFR reflects its conservative financial policies
and history, and significant presence in the worldwide theatrical
animation segment, constrained by the company's relatively small
scale, business diversity, and the inherently risky nature of the
film business. While the company is looking to improve its
diversity by expanding its television production business, it
remains exposed to the concentration risk of releasing only 2-3
films per year which are expected to drive the majority of its
revenues in the intermediate term. However, the company also
benefits from its sole focus on the animation industry, which has
a more flexible construct and technology-driven development
process than live action films, and this combined with DreamWorks'
expertise in developing proprietary computer graphics technology
partially mitigates the level of business risk typically
associated with independent film studios. The company's Ba2 rating
reflects its leading market position in the animation industry and
its strong track record of producing profitable films that can be
developed into franchises with international appeal, supported by
an experienced management team led by industry veteran Jeffrey
Katzenberg. Moody's believes that the recent mixed performance of
the company's film slate (including the weak opening for Turbo in
July 2013 and underperformance of Rise of the Guardians in
November 2012) is unusual given its history, and is likely driven
by a crowded film marketplace. Moody's expects the company to
better manage its release dates and promotional investments to
adapt to the more competitive landscape going forward. The rating
takes into account the company's recent acquisitions of
intellectual property which Moody's believes will be refreshed and
expanded to build a lucrative television animation business,
including the notable agreements recently signed with Netflix (Ba3
CFR) and Super RTL (a German TV channel).
The rating also reflects DreamWorks conservative financial
policies as evidenced by the very low leverage (under 1.0x from
2007-2011) and the high cash balances it has maintained
historically. While Moody's expect the company to carry a higher
level of debt going forward, it expects it to maintain its debt-
to-EBITDA leverage under 3.0x (including Moody's standard
adjustments) in the long term, notwithstanding some degree of
volatility based on film performance, and maintain strong internal
and external liquidity to weather such volatility. Moody's also
expects the company to engage in some level of share repurchases
and opportunistic acquisitions, but while maintaining a relatively
conservative balance sheet for the Ba2 category.
The stable outlook reflects Moody's expectation that the company
will continue to develop new and profitable animated film
franchises, and de-lever in the intermediate term through
sustained EBITDA growth to sustain leverage within the broad range
of 1.5x-3.0x.
A rating downgrade could occur if the company's liquidity position
becomes pressured, or if leverage is expected to be sustained over
3.0x. A downgrade could also occur if the company increases debt
to engage in shareholder friendly activities in a manner such that
there appears to be a shift towards a more aggressive fiscal
policy.
The upward potential for the company's rating is heavily
constrained by its lack of scale and its concentration in the film
business. A material increase in business diversity which results
in a significant proportion of more stable and predictable revenue
and cash flow, higher EBITDA margins, along with sustained minimal
leverage may lead to some upward momentum in the long term.
DreamWorks' ratings were assigned by evaluating factors that
Moody's considers relevant to the credit profile of the issuer,
such as the company's (i) business risk and competitive position
compared with others within the industry; (ii) capital structure
and financial risk; (iii) projected performance over the near to
intermediate term; and (iv) management's track record and
tolerance for risk. Moody's compared these attributes against
other issuers both within and outside DreamWorks' core industry
and believes DreamWorks' ratings are comparable to those of other
issuers with similar credit risk. Other methodologies used include
Loss Given Default for Speculative-Grade Non-Financial Companies
in the U.S., Canada and EMEA published in June 2009.
DreamWorks Animation SKG, Inc., based in Glendale, California, is
an animation studio that produces animated feature films,
television specials and series, and related entertainment and
consumer products.
DYNEGY INC: Danskammer Plant Sale Falls Through
-----------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that although the four operating subsidiaries of power
producer Dynegy Inc. have an approved Chapter 11 plan, the status
of the companies is in doubt because one of them failed to
complete the sale of its plant.
The report recounts that Dynegy Holdings LLC and parent Dynegy
Inc. exited bankruptcy reorganization in October after their plan
was confirmed by the U.S. Bankruptcy Court in Poughkeepsie, New
York. The four operating subsidiaries won court approval of their
separate plan in a March confirmation order. The operating
debtors owned four power plants. The operating companies are
Dynegy Northeast Generation Inc., Hudson Power LLC, Dynegy
Danskammer LLC and Dynegy Roseton LLC.
In December, the bankruptcy court approved the sale of two plants
near Newburgh, New York, known as the Roseton and Danskammer
facilities. The sales were to generate a combined $23 million to
be distributed under the subsidiaries' plan. The Roseton sale
closed.
According to the report, the Danskammer plant was damaged by
Hurricane Sandy and is being retired. ICS NY Holdings LLC was
under contract to buy the plant for $3.5 million and become
responsible for environmental remediation. After the buyer didn't
complete the transaction, the bankruptcy judge signed an order
last week giving ICS a July 31 deadline to complete the
acquisition. Otherwise, the judge said, ICS would forfeit a
$350,000 deposit.
The Dynegy parent said in a regulatory filing Aug. 1 that the
Danskammer sale didn't close and the contract with ICS was
"terminated." Dynegy said the subsidiary is "actively marketing"
the plant.
Meanwhile, the four subsidiaries have an Aug. 9 deadline for
implementing their Chapter 11 plan. The parent didn't say what
the future holds for the subsidiaries, other than to say
liquidation in Chapter 7 is a possibility. The subsidiaries' plan
was spelled out in a settlement agreement underlying the parent
companies' reorganization plan.
The operating companies said they had creditors with about $3.2
million in claims to receive a distribution between 11 percent and
19 percent under their plan. The cash to pay the claims is being
made available by senior creditors.
About Dynegy
Through its subsidiaries, Houston, Texas-based Dynegy Inc.
(NYSE: DYN) -- http://www.dynegy.com/-- produces and sells
electric energy, capacity and ancillary services in key U.S.
markets. The power generation portfolio consists of approximately
12,200 megawatts of baseload, intermediate and peaking power
plants fueled by a mix of natural gas, coal and fuel oil.
Dynegy Holdings LLC and four other affiliates of Dynegy Inc.
sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case
No. 11-38111) on Nov. 7, 2011, to implement an agreement with a
group of investors holding more than $1.4 billion of senior notes
issued by Dynegy's direct wholly-owned subsidiary, Dynegy
Holdings, regarding a framework for the consensual restructuring
of more than $4.0 billion of obligations owed by DH. If this
restructuring support agreement is successfully implemented, it
will significantly reduce the amount of debt on the Company's
consolidated balance sheet. Dynegy Holdings disclosed assets of
$13.77 billion and debt of $6.18 billion.
Dynegy Inc. on July 6, 2012, filed a voluntary petition to
reorganize under Chapter 11 (Bankr. S.D.N.Y. Case No. 12-36728) to
effectuate a merger with Dynegy Holdings, pursuant to Holdings'
Chapter 11 plan.
Dynegy Holdings and its affiliated debtor-entities are represented
in the Chapter 11 proceedings by Sidley Austin LLP as their
reorganization counsel. Dynegy and its other subsidiaries are
represented by White & Case LLP, who is also special counsel to
the Debtor Entities with respect to the Roseton and Danskammer
lease rejection issues. The financial advisor is FTI Consulting.
The Official Committee of Unsecured Creditors in Holdings' cases
has tapped Akin Gump Strauss Hauer & Feld LLP as counsel.
Dynegy Holdings and its parent, Dynegy Inc., completed their
Chapter 11 reorganization and emerged from bankruptcy Oct. 1,
2012. Under the terms of the DH/Dynegy Plan, DH merged with and
into Dynegy, with Dynegy, Inc., remaining as the surviving entity.
Dynegy Northeast Generation, Inc., Hudson Power, L.L.C., Dynegy
Danskammer, L.L.C. and Dynegy Roseton, L.L.C., won confirmation of
their plan of liquidation in March 2013, allowing the former
operating units of Dynegy to consummate a settlement agreement
resolving some lease trustee claims and sell their facilities.
EARL GAUDIO: Files List of 20 Largest Unsecured Creditors
---------------------------------------------------------
Earl Gaudio & Son Inc. submitted to the Bankruptcy Court a list
that identifies its top 20 unsecured creditors.
Creditors with the three largest claims are:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Regions Commercial Pam $5,025,075
PO Box 11407
Birmingham, AL, 35246
Small Business Growth Corp. $1,680,000
2401 West White Oaks Dr
Springfield, IL 62704
Illinois Department of Revenue $892,939
100 West Randolph St.
Chicago, IL 60601
A copy of the creditors' list is available for free at:
http://bankrupt.com/misc/EARL_GAUDIO_creditorslist.pdf
Earl Gaudio & Son Inc. filed a Chapter 11 petition (Bankr. C.D.
ILL. Case No. 13-90942) on July 19, 2013. The petition was signed
by Angela E. Major Hart, as authorized signer of First Midwest
Bank, custodian. Judge Gerald D. Fines presides over the case.
The Debtor estimated assets of at least $10 million and debts of
at least $1 million. John David Burke, Esq., at Ice Miller, LLP,
serves as the Debtor's counsel.
EAST END: DJM Realty and GA Keen Approved as Real Estate Advisers
-----------------------------------------------------------------
The Bankruptcy Court authorized East End Development, LLC et al.,
to employ DJM Realty Services, LLC, and GA Keen Realty Advisors,
LLC as real estate advisers.
The Court also authorized the Debtor to pay the advisory fee
without further application to, or order of, the Court. DJM/Keen
will be paid a brokerage commission of 3-1/2% of the entire
purchase price if an individual or entity other than Amalgamated
Bank or Amalgamated's designee is the successful bidder of the
Debtors' assets. DJM/Keen will also be paid for reimbursement of
its reasonable marketing expenses, provided that the expenses will
be capped at $30,000.
As reported in the Troubled Company Reporter on Aug. 1, 2013, DJM
and Keen will assist the Debtor to market and advertise an auction
to potential bidders, in accordance with the terms and conditions
of the retention agreement. The Debtor selected the joint venture
of DJM and Keen based on their unique knowledge and expertise in
the commercial real estate market of Long Island, with the consent
and approval of Amalgamated.
The Debtor believes that the joint efforts of DJM and Keen are
well-suited to represent fully the interests of the Debtor in an
efficient and effective manner.
As real estate consultants to the Debtor, it is expected that DJM
and Keen will market and advertise the upcoming Auction of the
Sale Assets to a large body of potential bidders, which in turn
will ensure that the value of the Debtor's assets is maximized
fully.
DJM and Keen will prepare a written marketing plan and budget in
connection with their role. It is contemplated that DJM and Keen
will be compensated in accordance with these terms:
(i) DJM/Keen will be paid an up-front advisory and consulting
fee in the amount of $60,000.00, which amount will be
DJM/Keen's sole fee if Amalgamated is the Successful
Bidder, as set forth in Section (II)(C)(1) of the Real
Estate Advisor Agreement;
(ii) DJM/Keen will be paid a brokerage commission of three and
one-half percent (3.5%) of the entire purchase price if an
individual or entity other than Amalgamated or
Amalgamated's designee is the Successful Bidder, as set
forth in Section (II)(C)(2) of the Real Estate Advisor
Agreement; and
(iii) DJM/Keen will be paid for reimbursement of its reasonable
marketing expenses, subject to a pre-approved budget that
will not exceed $30,000.00, as set forth in Section IV(A)
of the Real Estate Advisor Agreement.
Matthew Bordwin, managing member of Keen, attests that the firm is
a "disinterested person" as the term is defined in Section 101(14)
of the Bankruptcy Code.
Edward P. Zimmer, Vice President of DJM, attests that the firm is
a "disinterested person" as the term is defined in Section 101(14)
of the Bankruptcy Code.
About East End Development
East End Development, LLC, the owner of a 90% completed
condominium in Sag Harbor, New York, filed a Chapter 11 petition
(Bankr. E.D.N.Y. Case No. 12-76181) in Central Islip, New York, on
Oct. 12, 2012. Tracy L. Klestadt, Esq., at Klestadt & Winters
LLP, in New York, N.Y., represents the Debtor in its restructuring
efforts. Edifice Real Estate Partners, LLC serves as its
construction consultant. The Debtor disclosed $27,300,207 in
assets and $35,344,416 in liabilities in its schedules.
John E. Westerman, Esq., and Mike M. Hennessey, Esq., at Westerman
Ball Ederer Miller & Sharfstein, LLP, in Uniondale, N.Y.,
represents lender Amalgamated Bank as counsel.
EASTMAN KODAK: Completes Syndication of $200MM Credit Facility
--------------------------------------------------------------
Kodak on Aug. 6 finalized the syndication and allocation of a new
five-year senior secured asset-based revolving credit facility of
$200 million. Together, this facility and the $695 million exit
and post-emergence term-loan credit facilities announced on
August 1 provide the company with up to $895 million in exit
financing with substantially improved terms from its previously
arranged lending agreements. The facilities will help to provide
the company with liquidity to finance its operations after
emergence.
Affiliates of Bank of America Merrill Lynch, Barclays and J.P.
Morgan served as joint lead arrangers for this revolving credit
facility.
"The completion of our emergence financing, combined with the
rights offering currently under way, will provide Kodak a capital
structure that supports the operation and growth of our new
company," said Antonio M. Perez, Chairman and Chief Executive
Officer. "With the approval of the Court, we will emerge as a
company with a strong balance sheet and the wherewithal to
continue to do our work of serving customers with disruptive
technologies and breakthrough solutions."
Credit agreements for the previously announced term loans and this
asset-based credit facility will be filed tomorrow, August 7, with
the U.S. Bankruptcy Court for the Southern District of New York.
The credit facilities are expected to close upon Kodak's emergence
from Chapter 11, subject to certain customary conditions.
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: Plan Draws More Objections from Shareholders
-----------------------------------------------------------
Eastman Kodak Co.'s proposed plan to exit bankruptcy continues to
face opposition from shareholders who will get nothing when the
company emerges from Chapter 11 protection.
The U.S. Bankruptcy Court in Manhattan has been flooded with
letters from shareholders asking the court to deny the approval of
Kodak's restructuring plan that would see their stock wiped out.
Most of the objections to the plan centered on the alleged
involvement of creditors, including those that agreed to backstop
the $406 million rights offering, in insider trading.
Ahsan Zia of Tinton Falls New Jersey, who proposed last month to
form an equity committee, called for a full-scale investigation
into the insider trading.
Mr. Zia said court filings show that some Kodak creditors, which
have access to non-public information, purchased unsecured notes
and claims of the company during post-bankruptcy "at substantial
discounts to face values." The same creditors, however, asserted
claims against the company for the full face amounts, he said.
"Fiduciaries should be restricted in the purchase of unsecured
claims because they should not profit from their unique insider
knowledge," Mr. Zia said.
Mr. Zia also said Kodak breached its fiduciary duty when it signed
a deal for the rights offering without a competitive bidding, and
did not consider alternative plans that could have prevented
change of ownership and add $760 million new value to the
reorganized Kodak by enabling the company to use the pre-emergence
tax attributes without limitation.
Kodak's plan calls for a $406 million rights offering under which
it will issue up to 34 million common shares or 85% of the equity
in the reorganized company. Creditors that agreed to backstop the
offering are GSO Capital Partners, BlueMountain Capital, George
Karfunkel, United Equities Group and Contrarian Capital.
Kodak had said its shareholders will get nothing and their stock
will be canceled when it emerges from bankruptcy protection.
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: Further Amends Rights Offering Procedures
--------------------------------------------------------
Eastman Kodak Co. amended the rights offering procedures with
regard to the transfers of rights to purchase shares of new common
stock in the so-called 4(2) rights offering.
The amended procedures require both the transferor and the
transferee to execute and deliver to the reorganized company a
certificate as a condition to any transfer of those shares to a
"qualified institutional buyer." A copy of the document detailing
the revised procedures can be accessed for free at:
http://is.gd/XLuDT5
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: Unsecured Creditors Oppose Equity Committee
----------------------------------------------------------
Eastman Kodak Co. recently completed syndication of $695 million
post-emergence term-loan credit facilities and will seek
confirmation of its Chapter 11 plan at a hearing on Aug. 20.
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Kodak's official creditors' committee joined the U.S.
Trustee in opposing appointment of an official committee to
represent shareholders. If appointed, the committee could oppose
plan approval at the Aug. 20 hearing because the plan has nothing
for shareholders.
Kodak said it's in the "final stages" of syndicating an asset-
backed revolving credit to make up another part of funds to
finance an exit from bankruptcy.
According to the report, the creditors' committee said there
should be no equity committee because Kodak is "hopelessly
insolvent." In June 2012, U.S. Bankruptcy Judge Allan L. Gropper
refused to appoint an official equity committee because there was
"no substantial evidence that equity will be entitled to a
meaningful distribution in this case."
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.
EXCEL MARITIME: Committee Says Competing Plan on the Way
--------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the Excel Maritime Carriers Ltd. committee of
unsecured creditors dropped a hint that holders of convertible
notes will be submitting a competing plan to reorganize the
operator of 38 dry-bulk vessels.
The report recounts that Excel filed a Chapter 11 plan last month
to implement a reorganization worked out before the bankruptcy
filing on July 1. Technically speaking, the plan would give
ownership of the company to secured lenders owed $771 million,
although the lenders will allow current owner Gabriel Panayotides
to maintain control least initially and buy the company back
later.
According to the report, in papers filed July 30, the committee
again complained about alleged defects in the plan and in
financing up for approval at an Aug. 5 hearing. The panel is
particularly opposed to the aspect of the plan where the current
owner can retain an interest while unsecured creditors receive
"nominal to no distribution."
The committee's papers, without elaboration, say that "certain"
holders of convertible notes are working on a competing plan to
"infuse capital" including no commitment for a "specific
management team." The creditors say the competing plan will
"comply with applicable bankruptcy law," in contrast to the
company plan they find defective.
The committee is especially opposed to a deathtrap provision in
the company's plan where unsecured creditors receive nothing if
they oppose the plan.
The company's plan calls for unsecured creditors with claims
totaling $163 million to receive a $5 million, 8 percent note for
a predicted recovery of 3 percent. The note is paid from excess
cash flow, so there is a possibility unsecured creditors receive
nothing. Holders of $150 million in unsecured convertible notes
make up the bulk of the unsecured claim pool.
Excel has a Sept. 30 hearing to consider approval of disclosure
materials explaining the company's plan.
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. 13-23060) 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.
EXIDE TECHNOLOGIES: Lead Victims Want Class Claim
-------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Exide Technologies is facing a bid by a group of Los
Angeles residents exposed to lead from a plant in Vernon,
California, to pursue claims against the company as a class.
About six weeks before the Milton, Georgia-based company's
bankruptcy, Zach Hernandez became the named plaintiff in a suit
against Exide in a state court in Los Angeles. The suit is based
in part on a determination by California environmental regulators
that the Vernon plant should close.
The lawyers for Hernandez are seeking permission to file a
single claim in the Exide bankruptcy on behalf of everyone who
suffered damage from exposure to lead from the plant. They are
also asking the bankruptcy judge to let the California suit
proceed. As an inducement, Hernandez's lawyers are willing to
collect only from insurance.
About Exide Technologies
Headquartered in Princeton, New Jersey, Exide Technologies
(NASDAQ: XIDE) -- http://www.exide.com/-- manufactures and
distributes lead acid batteries and other related electrical
energy storage products.
Exide first sought Chapter 11 protection (Bankr. Del. Case No.
02-11125) on April 14, 2002 and exited bankruptcy two years after.
Matthew N. Kleiman, Esq., and Kirk A. Kennedy, Esq., at Kirkland &
Ellis, and James E. O'Neill, Esq., at Pachulski Stang Ziehl &
Jones LLP represented the Debtors in their successful
restructuring.
Exide Technologies returned to Chapter 11 bankruptcy (Bankr. D.
Del. Case No. 13-11482) on June 10, 2013.
For the new case, Exide has tapped Anthony W. Clark, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, and Pachulski Stang
Ziehl & Jones LLP as counsel; Alvarez & Marsal as financial
advisor; Sitrick And Company Inc. as public relations consultant
and GCG as claims agent.
The Debtor disclosed $1.89 billion in assets and $1.14 billion in
liabilities as of March 31, 2013.
Exide's international operations were not included in the filing
and will continue their business operations without supervision
from the U.S. courts.
Robert A. DeAngelis, the U.S. Trustee for Region 3, appointed
seven creditors to serve in the Official Committee of Unsecured
Creditors in the Debtor's case.
FAIRMOUNT MINERALS: Moody's Rates $1.2-Billion Debt Facilities B1
-----------------------------------------------------------------
Moody's Investors Service assigned a B1 rating to Fairmount
Minerals proposed $1.285 billion senior secured credit facilities.
Moody's affirmed Fairmount's B1 corporate family rating, B2-PD
probability of default rating and maintained the stable outlook.
The proceeds from the proposed credit facilities will be used to
fund the acquisition of nearly all of FTS International's sand
mining operations, resin-coating plants and distribution
terminals, to refinance existing debt, to pay related fees and
expenses and for general corporate.
The following actions were taken:
Proposed $1.285 billion senior secured credit facilities, assigned
B1 (LGD3, 34%);
Corporate family rating, affirmed at B1;
Probability of default rating, affirmed at B2-PD.
Ratings Rationale:
Fairmount's B1 Corporate family rating reflects the company's
modest scale, acquisitive history, relatively low liquidity,
limited product diversification and reliance on the hydraulic
fracturing industry and the volatile oil & gas sector for the
majority of its revenue and operating income. Fairmount's rating
is supported by its above average margins, moderate debt leverage,
healthy interest coverage, large base of proven mineral reserves,
strategically located quarries and production facilities,
developed logistical network, long-standing customer relationships
and strong market position in the growing frac sand industry and
the barriers to entry for competitors.
Fairmount's operating results have been under pressure recently
due to softening demand for resin-coated sand, which carries a
significantly higher price point and higher margins than raw sand.
This has more than offset a significant improvement in raw sand
volumes and led to a significant decline in EBITDA over the past
four quarters. However, the company's adjusted leverage
(Debt/EBITDA) and interest coverage (EBIT/Interest) ratios have
remained relatively stable at approximately 3.0x and 4.7x
respectively, which are both strong for the company's rating.
However, these ratios are expected to deteriorate modestly in the
short term since the company has recently accelerated its spending
on acquisitions and growth initiatives. The company completed two
acquisitions in the first half of 2013 including a new proppant
coating technology and additional high quality sand reserves in
Minnesota, and expects to close the acquisition of nearly all of
FTS International's sand mining operations, resin-coating plants
and distribution terminals during the third quarter. In addition,
the company is ramping up its investments in its distribution
terminal network and is projecting increased capital investments
this year. Therefore, Moody's expects the company's leverage ratio
to rise to approximately 3.8x and its interest coverage ratio to
decline to about 4.0x on a pro forma LTM basis including all of
the acquired assets.
The acquisition of FTS International's sand operations will expand
the company's footprint to 27 mining facilities with 718 million
tons of white and brown sand reserves and 52 distribution
terminals. The majority of the reserves acquired from FTSI consist
of brown sand versus the white sand that is currently produced by
Fairmount. Brown sand is not considered as valuable as white sand
to oil field service companies since it has a lower crush
resistance. Therefore, brown sand sells for a lower price point
and has experienced slower growth rates than white sand. However,
FTSI has entered into a long term supply agreement with Fairmount
to purchase a significant volume of brown and white sand, which
should enable this acquisition to be nicely accretive to the
company. Moody's estimates the assets acquired from FTSI will
enable Fairmount to increase annual shipments by approximately 40%
and raise EBITDA by a significant, although lower percentage since
the addition of brown sand volumes will modestly reduce the
company's profit margins.
Moody's assigned a B1 rating to the proposed senior secured credit
facilities, which is on par with the B1 corporate family rating
since the credit facility accounts for 100% of the debt in the
company's capital structure. The credit facility is comprised of a
$75 million revolving credit facility due 2018, a $250 million
term loan B-1 due 2017 and a $960 million term loan B-2 due 2019.
These credit facilities are secured by a first priority lien on
substantially all assets of the borrower and its subsidiaries. The
B2-PD probability of default rating is one notch lower than the
corporate family rating to reflect the higher (65%) recovery rate
utilized in Moody's loss-given-default methodology for companies
that rely primarily on first-lien bank loans. Historical recovery
studies indicate that corporate capital structures comprised
solely of bank debt have higher recovery values than those that
utilize a combination of bank debt and other debt instruments.
Fairmount is expected to have a relatively low liquidity position
after the acquisition of FTSI's assets with a low cash balance of
approximately $5 million and modest borrowing availability of
approximately $25 million. However, it is Moody's expectation that
they will begin to generate significant positive free cash flow
over the next 12 to 18 months as capital investments decline from
an elevated level and cash is generated by the acquired assets.
The stable outlook presumes that market conditions remain
relatively stable and that Fairmount successfully integrates the
assets acquired this year. It also assumes the company carefully
balances its leverage and other credit metrics with its growth
strategies.
The ratings could experience upward pressure if the company
continues to build greater scale and diversity, consistently
generates positive free cash flow, sustains EBITDA margins above
30% and reduces its adjusted leverage ratio below 3.0x.
The ratings would be considered for a downgrade in the event
EBITDA margins deteriorate significantly; the company more
aggressively pursues growth or shareholder friendly initiatives,
or experiences deteriorating operating results that lead to
adjusted debt-to-EBITDA rising above 4.0x, EBIT/Interest declining
below 3.0x or significantly reduced liquidity.
The principal methodology used in this rating was the Global
Building Materials Industry Methodology published in July 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.
Fairmount Minerals, Ltd. headquartered in Chardon, OH is a
producer of industrial sand, silica and related sand-based
proppants used predominantly in the oil and gas sector and to a
lesser extent in industrial and recreational applications. The
company operates 22 mining and manufacturing facilities, and
controls 40 distribution terminals along various transportation
corridors that assist in the efficient distribution of its
products. Fairmount sells the majority of its products to oil and
natural gas service companies, which account for approximately 85%
of sales. The company generated revenue of approximately $870
million during the twelve months ended March 31, 2013.
FIRST STREET HOLDINGS: Hearing Today to Appoint Chapter 11 Trustee
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of California
will convene a hearing on Aug. 7, 2013, at 2 p.m., to consider
creditor Mark R. Solit's motion for appointment of a Chapter 11
trustee for First Street Holdings NV, LLC et al.
Mr. Solit alleges that during most of the past two years, there
has been no movement toward a resolution that would allow payment
of the bankruptcy estates' many creditors. There is no
reorganization contemplated in the jointly administered cases.
Mr. Solit added that it appears that the Debtors' management has
been attempting to settle claims, but there have been no motions
to approve compromises.
Mr. Solit is represented by Scott H. McNutt, Esq., at McNutt Law
Group LLP as counsel.
About First Street Holdings NV
First Street Holdings NV, LLC, and Lydian SF Holdings, LLC, filed
for Chapter 11 bankruptcy (Bankr. N.D. Calif. Case Nos. 11-49300
and 11-49301) on Aug. 30, 2011, before Judge Roger L. Efremsky.
Debtor-affiliates 78 First Street, LLC, 88 First Street LLC, 518
Mission, LLC, First/Jessie LLC, JP Capital, LLC, Peninsula Towers
LLC, and Sixty-Two First Street LLC (Bankr. N.D. Calif. Case Nos.
11-70224, 11-70228,, 11-70229, 11-70231, 11-70232, 11-70233 and
11-70234) filed for Chapter 11 bankruptcy on Sept. 23, 2011.
The Law Office of Julian Bach represents the Debtors as Chapter 11
counsel.
Robert G. Harris, Esq., and Wendy W. Smith, Esq., at Binder &
Malter, LLP represent the Debtors as Special Appellate Counsel.
The Law Offices of Michael Brooks Carroll is special litigation
counsel for certain debtors in adversary proceeding and related
pending federal appeal.
Colliers Parrish International Inc. serves as appraiser to value
certain real properties and other assets held by the Debtors.
The cases are jointly administered under Lead Case No. 11-49300.
Investor David Choo is associated with CMR Capital, LLC, the
manager of the Debtors.
Debtors First Street Holdings NV, LLC, Lydian SF Holdings, LLC, 78
First Street, LLC, 88 First Street, LLC, 518 Mission, LLC,
First/Jessie, LLC, Sixty-two First Street, LLC, Peninsula Towers,
LLC, and JP Capital, LLC; and David Choo, individually, filed a
combined joint plan and disclosure statement with the Bankruptcy
Court. The Joint Plan, dated Nov. 29, 2011, provided for the
payment of all of their secured, administrative, priority and
general unsecured claims in full. Interests in the Debtors would
be retained without modification.
In December 2011, the bankruptcy court held that the First Street
Parties had not proven that they had a reasonable possibility of
an effective reorganization within a reasonable time. The court
noted the proposed plan likely qualified as a negative
amortization plan, which would be difficult to confirm under the
best of circumstances. The court also noted that the Properties
as of the time of the hearing did not generate enough monthly
rents to pay monthly operating expenses and property taxes. The
court also doubted that the First Street Parties could raise
sufficient plan funding, as they had proposed, by renting out
additional available space in the buildings on the Properties.
FIRSTPLUS FINANCIAL: Accountant Cops Plea in Mafia Takeover
-----------------------------------------------------------
Law360 reported that a Pennsylvania accountant pled guilty to a
conspiracy to commit fraud charge in New Jersey federal court tied
to his role in the allegedly extortionate takeover of FirstPlus
Financial Group Inc., a Texas-based mortgage lender federal
prosecutors say was bankrupted by members of the Lucchese
organized crime family.
According to the report, Howard A. Drossner, a cofounder of the
Elkins Park, Pa.-based accounting firm Siegal and Drossner PC,
pled guilty to a count of conspiracy to commit wire fraud in
connection with an October 2011 indictment accusing Lucchese.
About FirstPlus Financial
Based in Beaumont, Texas, FirstPlus Financial Group, Inc. (Pink
Sheets: FPFX) -- http://www.firstplusgroup.com/-- was a
diversified company that provided commercial loan, consumer
lending, residential and commercial restoration, facility
(janitorial and maintenance) services, insurance adjusting
services, construction management services and a facilities and
restoration franchise business. The Company had three direct
subsidiaries, Rutgers Investment Group, Inc., FirstPlus
Development Company and FirstPlus Enterprises, Inc. In turn,
FirstPlus Enterprises, Inc., had three of its own direct
subsidiaries, FirstPlus Restoration Co., LLC, FirstPlus Facility
Services Co., LLC and The Premier Group, LLC. FirstPlus
Restoration and FirstPlus Facility jointly owned FirstPlus
Restoration & Facility Services Company. Additionally, FirstPlus
Development had one direct subsidiary FirstPlus Acquisitions-1,
Inc.
A subsidiary of FirstPlus Financial Group -- FirstPlus Financial
Inc. -- filed for Chapter 11 bankruptcy in March 1999 before the
U.S. Bankruptcy Court for the Northern District of Texas, Dallas
Division, amid turmoil in the asset-backed securitization markets
and the lack of a reliable, committed secondary take-out source
for high LTV loans. A modified third amended reorganization plan
was confirmed in that case in April 2000.
FirstPLUS Financial Group filed for Chapter 11 protection (Bankr.
N.D. Tex. Case No. 09-33918) on June 23, 2009. Aaron Michael
Kaufman, Esq., and George H. Tarpley, Esq., at Cox Smith Matthews
Incorporated, served as counsel. The Debtor had total assets of
$15,503,125 and total debts of $4,539,063 as of June 30, 2008.
FirstPLUS Financial Group disclosed $1,264,637 in assets and
$10,347,448 in liabilities as of the Chapter 11 filing.
Matthew D. Orwig was appointed as the Chapter 11 trustee in the
Debtor's cases. He is represented by Peter A. Franklin, Esq., and
Erin K. Lovall, Esq., at Franklin Skierski Lovall Hayward LLP.
Franklin Skierski was elevated to lead counsel from local counsel
in the stead of Jo Christine Reed and SNR Denton US LLP, due to
the maternity leave of Ms. Reed. Kurtzman Carson Consultants
served as notice and balloting agent.
GRAND CENTREVILLE: Case Summary & 8 Unsecured Creditors
--------------------------------------------------------
Debtor: Grand Centreville, LLC
dba Old Centreville Crossing Shopping Center
13810-13860 Braddock Road
Centreville, VA 20121
Bankruptcy Case No.: 13-13590
Chapter 11 Petition Date: August 2, 2013
Court: U.S. Bankruptcy Court
Eastern District of Virginia (Alexandria)
Judge: Robert G. Mayer
Debtor's Counsel: Paula S. Beran, Esq.
TAVENNER & BERAN, PLC
20 North Eighth Street, Second Floor
Richmond, VA 23219
Tel: (804) 783-8300
Fax: (804) 783-0178
E-mail: pberan@tb-lawfirm.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The petition was signed by Michael L. Schuett, Principal Black
Creek Consulting Ltd., receiver.
Affiliate that filed separate Chapter 11 petition:
Entity Case No. Petition Date
------ -------- -------------
Kang 10-18839 10/19/10
Debtor's List of Its Eight Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Offit Kurman Legal Services $89,000
Attn: Thomas Repczynski, Esq.
4800 Montgomery Lane, 9th Floor
Bethesda, MD 20814
Liz Walther Legal Services $9,674
105 North Main Street, Suite 241F
Culpeper, VA 22701
Deoudes-Magafan Realty Management Fee $3,175
7910 Woodmount Avenue
Bethesda, MD 20814
Gettier Commercial Parking Lot Cleaning $1,545
Guardian Fire Protection Fire Alarm Service $572
ShenCorp Roof Repair $451
Verizon Utilities $380
RC&CC, LLC Sign Repair $90
GREATER BETHEL: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: The Greater Bethel Apostolic Church
8500 S. Figueroa Street
Los Angeles, CA 90003
Bankruptcy Case No.: 13-29514
Chapter 11 Petition Date: August 1, 2013
Court: U.S. Bankruptcy Court
Central District of California (Los Angeles)
Judge: Ernest M. Robles
Debtor's Counsel: Thomas M. Alexander, Jr., Esq.
ALEXANDER LAW OFFICES
468 N. Camden Drive, Suite 200
Beverly Hills, CA 90210
Tel: (310) 860-7678
Fax: (310) 356-3210
E-mail: alexanderslaw@gmail.com
Scheduled Assets: $89,664
Scheduled Liabilities: $1,654,971
The Company's list of its 20 largest unsecured creditors is
available for free at:
http://bankrupt.com/misc/cacb13-29514.pdf
The petition was signed by Aaron M. Martin, CEO.
GREGORY WOOD: Can File Bankruptcy Plan Until Aug. 15
----------------------------------------------------
Judge Laura T. Beyer has extended the deadline for Gregory Wood
Products LLC to file a plan of reorganization and disclosure
statement to Aug. 15, 2013.
About Gregory Wood Products
Gregory Wood Products, Inc., filed a Chapter 11 petition (Bankr.
W.D.N.C. Case No. 13-50104) on Feb. 15, 2013, disclosing total
assets of $15.1 million and liabilities of $10.9 million.
The Debtor owns land and building in Woodtech Drive, in Newton,
California, worth $3.28 million, serving as collateral to a
$10.3 million debt. The Debtor valued its machinery and equipment
at $11.3 million. David A. Matthews, Esq., at Shumaker, Loop &
Kendrick, LLP, in Charlotte, North Carolina, serves as counsel to
the Debtor. Judge Laura T. Beyer presides over the case.
HART OIL: William Davis Can't Represent Chapter 11 Trustee
----------------------------------------------------------
Bankruptcy Judge David T. Thuma denied the request of the Interim
Chapter 11 Trustee for Hart Oil & Gas, Inc., to retain William F.
Davis & Associates, P.C., as special counsel pursuant to 11 U.S.C.
Sec. 327(e). Objections to the Motion were filed by Ad Hoc
Committee of Unsecured Creditors, the Citizens Bank of Kilgore,
the Unsecured Creditors' Committee, and the United States
Trustee's Office. The Court held that the Motion should be denied
because the proposed scope of employment would be representing the
Chapter 11 Trustee in "conducting the case" and because the Davis
Firm has a disqualifying conflict of interest.
In October 2012, the Debtor won Court approval to employ William
F. Davis & Associates, P.C., as its counsel. According to Judge
Thuma, the Davis Firm has never sought to withdraw from
representing the Debtor, and there is no evidence that the Debtor
would consents to such a withdrawal, or consents to the Motion.
The Chapter 11 Trustee filed a Liquidating Plan for the Debtor on
July 26, 2013, together with a draft disclosure Statement. Both
documents were prepared by the Davis Firm. On the same date the
Trustee filed a Motion Pursuant to 11 U.S.C. Sec. 363(b) for Order
Approving Sale of the Debtor's Navajo Nation Leases and Personal
Property Free and Clear of all Claims to Palo Petroleum, Inc. The
Davis Firm prepared the 363 Motion.
A copy of the Court's Aug. 2, 2013 Memorandum Opinion is available
at http://is.gd/NTHTRFfrom Leagle.com.
Hart Oil & Gas, Inc., based in Austin, Texas, filed for Chapter 11
(Bankr. D.N.M. Case No. 12-13558) on Sept. 25, 2012. Judge Robert
H. Jacobvitz was first assigned to the case. William F. Davis,
Esq. -- daviswf@nmbankruptcy.com -- at William F. Davis &
Associates, P.C., serves as the Debtor's counsel. In its
petition, the Debtor estimated $100,001 to $500,000 in assets, and
$1 million to $10 million in debts. A list of the Company's 20
largest unsecured creditors filed with the petition is available
for free at http://bankrupt.com/misc/nmb12-13558.pdf The petition
was signed by Andrew Brian Saied, president.
HEMISPHERE MEDIA: S&P Assigns 'B' CCR; Outlook Stable
-----------------------------------------------------
Standard & Poor's Ratings Services assigned Coral Gables, Fla.-
based TV cable network and TV broadcasting company Hemisphere
Media Group Inc. its 'B' corporate credit rating. The outlook is
stable.
At the same time, S&P assigned subsidiaries and co-borrowers
Hemisphere Media Holdings LLC and InterMedia Espanol Inc.'s
$175 million senior secured term loan B due 2020 its issue-level
rating of 'B' (at the same level as the corporate credit rating on
the parent), with a recovery rating of '3', indicating S&P's
expectation for meaningful (50% to 70%) recovery for lenders in
the event of a payment default.
The 'B' corporate credit rating on Hemisphere Media Group Inc.
reflects S&P's view that the company has a "weak" business risk
profile and an "aggressive" financial risk profile, according to
its criteria. The business risk profile is based on the company's
limited scale (it only owns a single TV broadcasting station in
Puerto Rico and two U.S.-based Spanish language cable networks)
and its narrow business focus, primarily targeting Hispanics
living in the U.S.
The company has a very short operating history, having only come
into existence in January 2013 (though the underlying businesses
have long operating histories), and S&P expects management to
continue making acquisitions over the long term to build scale.
Pro forma for the transaction, Hemisphere has liquidity to fund
acquisitions of up to about $150 million. Therefore, S&P expects
the company would need to access the capital markets over the
intermediate term to continue its aggressive acquisition growth
strategy.
S&P believes the company's focus on Hispanics living in the U.S.
provides the company some protection from broad English-language
competition, but also limits growth prospects. Its WAPA assets
focuses on a smaller subsegment, Puerto Ricans and Caribbean
Hispanics. While S&P believes this subsegment is underserved by
the larger Hispanic broadcasters that have traditionally focused
on Mexican Americans, S&P thinks that increasing penetration of
Hispanic households will be difficult. The company's two cable
networks are not generally included in most cable operators' basic
tier, which leads to lower penetration and lower subscription and
advertising revenue. Currently, both WAPA America and Cinelatino
have undeveloped distribution and reach about 5 million households
in the U.S. Subscription revenue accounts for 37% of total
revenues, compared with 40% to 60% for other larger cable
networks, underscoring the company's need to grow subscribers and
generate higher advertising revenue from its cable networks.
Still, affiliate agreements provides stable recurring revenue
despite the small base.
HRK HOLDINGS: Got Exclusive Plan Filing Period Extn. to Aug. 30
---------------------------------------------------------------
Bankruptcy Judge K. Rodney May has extended the deadline for HRK
Holdings, LLC and HRK Industries, LLC to file a plan of
reorganization through Oct. 30, 2013, and the Debtors' deadline to
solicit acceptances for that plan through Oct. 30, 2013.
About HRK Holdings
Based in Palmetto, Florida, HRK Holdings LLC owns roughly 675
contiguous acres of real property in Manatee County, Florida.
Roughly 350 acres of the property accommodates a phosphogypsum
stack system, called Gypstaks, a portion of which was used as an
alternate disposal area for the management of dredge materials
pursuant to a contract with Port Manatee and as authorized under
an administrative agreement with the Florida Department of
Environmental Protection. The remaining acres of usable land are
either leased to various tenants or available for sale. HRK
Industries holds various contracts and leases associated with the
Debtors' property.
HRK Holdings and HRK Industries LLC filed for Chapter 11
protection (Bankr. M.D. Fla. Case Nos. 12-09868 and 12-09869) on
June 27, 2012. Judge K. Rodney May oversees the case. Barbara A.
Hart, Esq., at Stichter, Riedel, Blain & Prosser, P.A., represents
the Debtors.
HRK Holdings disclosed $33,366,529 in assets and $26,092,559
in liabilities in its revised schedules.
According to the Debtors, the bankruptcy filing was necessitated
by the immediate need to sell a portion of the remaining property
to create liquidity for (a) funding the urgent management of the
site-related environmental concerns; the benefit of creditors;
funding a litigation filed by the Debtors; and funding of expenses
related to additional sales of the remaining property.
HUB INTERNATIONAL: S&P Affirms 'B' CCR & Puts on Watch Negative
---------------------------------------------------------------
Standard & Poor's Ratings Services said that it has affirmed all
of its ratings, including the 'B' corporate credit rating, on HUB
International Ltd. and placed them on CreditWatch with negative
implications.
"The CreditWatch placement follows HUB's announcement that it has
reached a definitive agreement to be acquired by Hellman &
Friedman in a $4.4 billion transaction. The deal will give the
private equity firm a majority stake in HUB; other terms of the
transaction were not disclosed," said Standard & Poor's credit
analyst Julie Herman. "The CreditWatch placement reflects our
limited information regarding the details of the transaction at
this time and our resultant uncertainty regarding the
transaction's effect on HUB's capital structure, cash flows, and
credit protection measures. The negative CreditWatch implications
indicate that we could affirm or lower the ratings following our
review."
"We will monitor developments relating to this transaction and
expect to resolve the CreditWatch listing within the next few
months following a review of the new equity sponsor's financing
plans and financial policy objectives, as well as HUB's new
capital structure. We could affirm the ratings if the resulting
capital structure results in the company maintaining credit
metrics that we consider appropriate for the current rating. We
could lower the ratings if the transaction results in
significantly weaker credit ratios," S&P added.
INSPIRATION BIOPHARMA: Files Liquidating Plan & Disclosures
-----------------------------------------------------------
Inspiration Biopharmaceuticals, Inc., delivered to the U.S.
Bankruptcy Court for the District of Massachusetts, Eastern
Division, a Liquidating Plan of Reorganization and accompanying
disclosure statement.
The Plan provides that holders of allowed claims will receive the
net proceeds of the sale of the Debtor's assets. A so-called
waterfall was established during the bankruptcy case to allocate
the asset sale consideration. As of July 31, 2013, the Debtor has
received proceeds of $2,750,000 under the Waterfall.
The Waterfall provides for the distribution of the proceeds from
the sale of the Debtor's products as follows:
* Priority 1 provides for payment of certain accrued and unpaid
administrative expenses, including employee retention
payments, success fee payments due to FTI Consulting as its
financial advisors and Evercore Partners as its investment
bankers, and amounts due to Biomeasure, Inc., an affiliate of
Ipsen, for postpetition services rendered, as well as
retention payments due to Biomeasure employees;
* Priority 2 provides for repayment of the DIP Financing, as
well as certain fees and expenses incurred by Ipsen in
connection with the DIP Financing and the asset sale;
* Priority 3 provides for payment to Ipsen of 50% of the amount
due to Ipsen in Priority 2 plus $375,000 to repay Ipsen for
prepetition advances, as well as $2,750,000 to be paid to
Inspiration to satisfy claims other than Priority 1 claims,
the claims of CMC, and the Ipsen Unsecured Claims;
* Priority 4 provides for payment of up to $400,000 in unpaid
fees and expenses of Professionals not paid pursuant to
Priority 1;
* Priority 5 provides for payment of the CMC Claim (which
totals $8,400,000) in an amount equal to 10% of the extent to
which the upfront cash consideration from the sales exceeds
$40,000,000;
* Priority 6 provides, generally, for a split of proceeds
amongst Ipsen (80%), Inspiration (5%), CMC (5%), and
Waterfall Participants (10%) provided that Ipsen subordinated
any claim to the first $3,820,000 payable in Priority 6 and
provided further that the Ipsen Unsecured Claims partially
subordinated the right to participate in that portion of the
proceeds payable to Inspiration. Priority 6 payments
continue until Ipsen has been paid $304,000,000 in present
value of aggregate payments;
* Priority 7 provides for an equal split of remaining sale
proceeds between Ipsen and Waterfall Participants, after
Ipsen has been paid all amounts owing in Priority 6.
A full-text copy of the Disclosure Statement, dated July 31, 2013,
is available for free at:
http://bankrupt.com/misc/INSPIRATIONBIOPHARMAds0731.pdf
A hearing to consider the adequacy of the disclosure statement is
scheduled for Sept. 18, 2013, at 09:30 a.m. Objections are due by
Sept. 16.
Harold B. Murphy, Esq., and Andrew G. Lizotte, Esq., at MURPHY&
KING, Professional Corporation, in Boston, Massachusetts,
represent the Debtor.
About Inspiration Biopharmaceuticals
Inspiration Biopharmaceuticals Inc. develops recombinant blood
coagulation factor products for the treatment of hemophilia.
Inspiration, based in Cambridge, Massachusetts, has two products
in what the company calls "advanced clinical development." Two
other products are in "pre-clinical development." None of the
products can be marketed as yet.
Inspiration filed for voluntary Chapter 11 reorganization (Bankr.
D. Mass. Case No. 12-18687) on Oct. 30, 2012, in Boston.
Bankruptcy Judge William C. Hillman oversees the case. Mark
Weinstein and Michael Nolan, at FTI Consulting, Inc., serve as the
Debtor's Chief Restructuring Officers. The Debtor is represented
by Harold B. Murphy, Esq., at Murphy & King.
The petition shows assets and debt both exceed $100 million.
Assets include patents, trademarks and the products in
development. Liabilities include $195 million owing to Ipsen
Pharma SAS, which is also a 15.5% shareholder. Ipsen --
http://www.ipsen.com/-- is also owed $19.4 million in unsecured
debt. There is another $12 million in unsecured claims. Ipsen is
pledged to provide $18.3 million in financing. The Debtor
disclosed $20,383,300 in assets and $241,049,859 in liabilities.
Ipsen is represented in the case by J. Eric Ivester, Esq., at
Skadden Arps.
The Official Committee of Unsecured Creditors tapped Jeffrey D.
Sternklar and Duane Morris LLP as its counsel, and The Hawthorne
Consulting Group, LLC as its financial advisor.
INTERFAITH MEDICAL: Hospital in Brooklyn to Close Down
------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Interfaith Medical Center Inc. acceded to demands by
the state Department of Health and will shut down, even though the
287-bed acute-care hospital said the closing "will have serious
consequences for the provision of healthcare" in the Bedford-
Stuyvesant section of Brooklyn, New York, where the facility is
located.
According to the report, state hospital regulators said they would
only agree to a reorganization plan that entailed no state
funding. After the hospital submitted a plan to comply, the state
notified IMC in July that it must prepare a "closure plan."
There will be an Aug. 15 hearing for the bankruptcy judge in
Brooklyn to approve procedures where patient admissions will halt
on Aug. 12, the emergency department will shut Sept. 11, and the
hospital will close by Sept. 12.
The New York State Dormitory Authority, a secured lender, said it
will only permit continuing use of cash as part of a closure
program.
About Interfaith Medical Center
Headquartered in Brooklyn, New York, Interfaith Medical Center,
Inc., operates a 287-bed hospital on Atlantic Avenue in Bedford-
Stuyvesant and an ambulatory care network of eight clinics in
central Brooklyn, in Crown Heights and Bedford-Stuyvesant.
The Company filed for Chapter 11 protection (Bankr. E.D. N.Y.
Case No. 12-48226) on Dec. 2, 2012. The Debtor disclosed
$111,872,972 in assets and $193,540,998 in liabilities as of the
Chapter 11 filing. Liabilities include $117.9 million owing to
the New York State Dormitory Authority on bonds secured by the
assets.
Alan J. Lipkin, Esq., at Willkie Farr & Gallagher LLP, serves as
bankruptcy counsel to the Debtor. Nixon Peabody LLP is the
special corporate and healthcare counsel. CohnReznick LLP serves
as financial advisor. Donlin, Recano & Company, Inc. serves as
administrative agent.
The Official Committee of Unsecured Creditors tapped Alston & Bird
LLP as its counsel, and CBIZ Accounting, Tax & Advisory of New
York, LLC as its financial advisor.
Eric M. Huebscher, the patient care ombudsman, tapped the law firm
of DiConza Traurig LLP, as his counsel.
JEMSEK CLINIC: Blue Cross Suit Remains in Discovery Phase
---------------------------------------------------------
In the action, BLUE CROSS AND BLUE SHIELD OF NORTH CAROLINA,
Plaintiff, Counterclaim Defendant Counterclaim, Plaintiff, v.
JEMSEK CLINIC, P.A. AND JOSEPH JEMSEK, M.D. an individual,
Defendants, Counterclaim Plaintiffs Counterclaim Defendants, Adv.
Proc. No. 07-3006 (Bankr. W.D.N.C.), Bankruptcy Judge J. Craig
Whitley granted, in part, and denied, in part, BCBSNC's Motion for
a Protective Order.
A copy of the Court's Aug. 2, 2013 Order is available at
http://is.gd/wO8Plafrom Leagle.com.
The Action began in September 2006 when BCBSNC sued the Jemsek
Defendants in North Carolina Superior Court, captioned as Blue
Cross and Blue Shield of North Carolina v. Jemsek Clinic, P.A. &
Joseph G. Jemsek, M.D., No. 06-CVS-18432. BCBSNC's claims arise
from medical treatments provided by the Jemsek Defendants to
BCBSNC members suffering from Lyme disease. Shortly after the
Superior Court case was filed, the Jemsek Defendants filed for
Chapter 11 and removed the state action to the Bankruptcy Court.
BCBSNC asserts that the Jemsek Defendants improperly submitted and
were paid for hundreds of insurance claims for these patients. The
Complaint seeks recovery of all sums previously paid to the Jemsek
Defendants and damages under a variety of legal theories. The
Action originally involved nine claims brought by BCBSNC against
the Jemsek Defendants, including breach of contract, fraud, unfair
trade practices, negligent misrepresentation, among other state
law claims.
The Jemsek Defendants, in-turn, asserted eight counterclaims
against BCBSNC, ranging from breach of contract to tortious
interference with a business relationship. The Counterclaims seek
an affirmative recovery from BCBSNC in excess of $20,000,000.
Since the original pleadings were filed, however, the scope of the
issues to be resolved in this litigation has narrowed. Now only
two claims remain at issue: the Jemsek Defendants' counterclaims
for tortious interference and defamation. The Adversary
Proceeding has been vociferously litigated and, despite best
efforts to move the matter along, remains in its discovery phase.
Jemsek Clinic, P.A., dba Jemsek Specialty Clinic, Lyme and Related
Diseases, PLLC, fka Jemsek Clinic, PLLC --
http://www.jemsekclinic.com/-- operates a center for the practice
of internal medicine and infectious diseases in Huntersville, N.C.
The center specializes in general infectious disease diagnosis and
treatment, with a primary focus on HIV/AIDS and Lyme Disease. The
debtor sought chapter 11 protection (Bankr. W.D.N.C. Case No. 06-
31766) on Oct. 25, 2006, and is represented by Travis W. Moon,
Esq. -- tmoon@lawhms.com -- at Hamilton Fay Moon Stephens Steele &
Martin, PLLC, in Charlotte, N.C. At the time of the filing, the
Debtor estimated its assets and debts at less than $10 million.
KIDSPEACE CORP: Deadline to File Claims Set for Aug. 30
-------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Pennsylvania
established Aug. 30, 2013, at 5:00 p.m. EST, as the bar date for
any entity, including a governmental unit, holding or wishing to
assert a claim against any of KidsPeace Corporation and its debtor
affiliates that arose on or before the Petition Date, including
any administrative expense claim arising under Section 503(b)(9)
of the Bankruptcy Code.
The Bar Date applies to all types of claims against the Debtors
that arose prior to the Petition Date, including secured claims,
unsecured priority claims, and unsecured nonpriority claims.
About KidsPeace Corp.
KidsPeace Corp., a provider of behavioral services for children,
filed a petition for Chapter 11 reorganization (Bankr. E.D. Pa.
Case No. 13-14508) on May 21, 2013, in Reading, Pennsylvania.
KidsPeace operates a 96-bed pediatric psychiatric hospital in
Orefield, Pennsylvania. Assets are $86.7 million, and debt on the
books is $158.6 million, according to a court filing.
The Debtor, which sought bankruptcy protection with eight
affiliates, tapped Norris McLaughlin & Marcus, P.A. as counsel;
EisnerAmper LLP as financial advisor, and Rust Omni as claims and
notice agent.
Assets total $158,587,999 at the end of 2012. The Debtors owe
approximately $56,206,821 in bond debt, and they have been told
that their pension liability is allegedly about $100,000,000 of
which the Debtors currently reflect $83,049,412 on their books.
KidsPeace sought Chapter 11 (i) as a means to implement a
negotiated restructuring of bond debt currently aggregating
approximately $51,310,000 plus accrued interest to a reduced
amount of approximately $24 million in new 30-year bonds with
interest at 7.5 percent, and (ii) to continue on-going
negotiations with the Pension Benefit Guaranty Corporation in
hopes of reducing the PBGC asserted obligation of $100+ million to
an amount that the Debtors can reasonably expect to satisfy.
The Debtor disclosed $157,930,467 in assets and $168,768,207 in
liabilities as of the Chapter 11 filing.
Since March 2012, MK has been exploring possible affiliation or
acquisition opportunities; however, no offer of an affiliation or
acquisition has been presented to the Debtors.
Gemino Healthcare Finance, LLC, the prepetition revolving lender,
is represented by James S. Rankin, Jr., Esq., at Parker, Hudson,
Rainer & Dobbs LLP; and Weir & Partners LLP's Walter Weir, Jr.,
Esq.
UMB Bank, N.A., on behalf of bondholders, Performance Food Group
d/b/a AFI, W.B. Mason Co., Inc., Pension Benefit Guaranty
Corporation, and Teresa Laudenslager were appointed to an official
committee of unsecured creditors in the Debtors' cases. The
Official Committee of Unsecured Creditors is represented by
Fitzpatrcik Lentz & Bubba, P.C., and Lowenstein Sandler LLP as
counsel. FTI Consulting, Inc. serves as the panel's financial
advisor.
KIDSPEACE CORP: Wants Ombudsman Terminated, Fees & Expenses Capped
------------------------------------------------------------------
KidsPeace Corp. and its debtor affiliates ask the U.S. Bankruptcy
Court for the Eastern District of Pennsylvania to terminate the
patient care ombudsman for the following reasons:
(i) the U.S. Trustee innocently, negligently or intentionally
misrepresented her intentions to impose limitations on the
PCO's engagement and in reliance on the Debtors' counsel
consented to an order authorizing the appointment of a PCO
which he would not otherwise have done;
(ii) the PCO is unqualified and therefore is unable to protect
mental health clients of the Debtors;
(iii) the Debtors' financial problems which precipitated the
filing of Chapter 11 had nothing to do with operational
issues impacting on client care; and
(iv) the responsibilities of the PCO to monitor the quality of
"patient" care and represent "patient" interests are
redundant of a comprehensive scheme of state and federal
statutes and regulations governing the Debtors' business.
In the alternative, should the Court be inclined to continue the
PCO's appointment, the Debtors assert that it is essential that
limits be imposed on the scope of the PCO's duties and that there
be a cap on his fees and expenses.
Specifically, the Debtors want the Court to direct the PCO, or
those acting on his behalf, to schedule their visits in advance,
and during those visits, the PCO and his representatives be
escorted by KidsPeace staff to avoid safety issues, potential
liability, and treatment disruption.
With regards to the PCO's fees and expenses, the Debtors assert
that it is essential that strict budgetary constraints be imposed
on him and his professionals or else "he will retain counsel at
$800 per hour and will run rampant in the case as he did in Daytop
Village [C]hapter 11 case in the Southern District of New York
where final fee applications in the aggregate amount of
approximately $500,000 are presently pending."
Gary N. Marks, Esq. -- gnmarks@nmmlaw.com -- at Norris, McLaughlin
& Marcus, PA, in Allentown, Pennsylvania, prepared the brief on
behalf of the Debtors.
About KidsPeace Corp.
KidsPeace Corp., a provider of behavioral services for children,
filed a petition for Chapter 11 reorganization (Bankr. E.D. Pa.
Case No. 13-14508) on May 21, 2013, in Reading, Pennsylvania.
KidsPeace operates a 96-bed pediatric psychiatric hospital in
Orefield, Pennsylvania. Assets are $86.7 million, and debt on the
books is $158.6 million, according to a court filing.
The Debtor, which sought bankruptcy protection with eight
affiliates, tapped Norris McLaughlin & Marcus, P.A. as counsel;
EisnerAmper LLP as financial advisor, and Rust Omni as claims and
notice agent.
Assets total $158,587,999 at the end of 2012. The Debtors owe
approximately $56,206,821 in bond debt, and they have been told
that their pension liability is allegedly about $100,000,000 of
which the Debtors currently reflect $83,049,412 on their books.
KidsPeace sought Chapter 11 (i) as a means to implement a
negotiated restructuring of bond debt currently aggregating
approximately $51,310,000 plus accrued interest to a reduced
amount of approximately $24 million in new 30-year bonds with
interest at 7.5 percent, and (ii) to continue on-going
negotiations with the Pension Benefit Guaranty Corporation in
hopes of reducing the PBGC asserted obligation of $100+ million to
an amount that the Debtors can reasonably expect to satisfy.
The Debtor disclosed $157,930,467 in assets and $168,768,207 in
liabilities as of the Chapter 11 filing.
Since March 2012, MK has been exploring possible affiliation or
acquisition opportunities; however, no offer of an affiliation or
acquisition has been presented to the Debtors.
Gemino Healthcare Finance, LLC, the prepetition revolving lender,
is represented by James S. Rankin, Jr., Esq., at Parker, Hudson,
Rainer & Dobbs LLP; and Weir & Partners LLP's Walter Weir, Jr.,
Esq.
UMB Bank, N.A., on behalf of bondholders, Performance Food Group
d/b/a AFI, W.B. Mason Co., Inc., Pension Benefit Guaranty
Corporation, and Teresa Laudenslager were appointed to an official
committee of unsecured creditors in the Debtors' cases. The
Official Committee of Unsecured Creditors is represented by
Fitzpatrcik Lentz & Bubba, P.C., and Lowenstein Sandler LLP as
counsel. FTI Consulting, Inc. serves as the panel's financial
advisor.
KIDSPEACE CORP: Ombudsman Seeks to Retain Bryan Cave as Counsel
---------------------------------------------------------------
Eric Huebscher, as patient care ombudsman for KidsPeace Corp., et
al., seeks authority from the U.S. Bankruptcy Court for the
Eastern District of Pennsylvania to retain Bryan Cave LLP as his
counsel to help him represent the rights of patients.
The PCO intends to retain the following Bryan Cave professionals
to be paid the following hourly rates:
Stephanie Wickouski, Esq. $780 per hour
stephanie.wickouski@bryancave.com
Eric Rieder, Esq. $850 per hour
erieder@bryancave.com
Thomas J. Schell, Esq. $635 per hour
tjschell@bryancave.com
Sheryl Feutz-Harter, Esq. $375 per hour
sheryl.feutzharter@bryancave.com
Jamilia Justine Willis, Esq. $450 per hour
jamila.willis@bryancave.com
Ms. Wickouski, a partner at Bryan Cave LLP, in New York, 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 PCO.
About KidsPeace Corp.
KidsPeace Corp., a provider of behavioral services for children,
filed a petition for Chapter 11 reorganization (Bankr. E.D. Pa.
Case No. 13-14508) on May 21, 2013, in Reading, Pennsylvania.
KidsPeace operates a 96-bed pediatric psychiatric hospital in
Orefield, Pennsylvania. Assets are $86.7 million, and debt on the
books is $158.6 million, according to a court filing.
The Debtor, which sought bankruptcy protection with eight
affiliates, tapped Norris McLaughlin & Marcus, P.A. as counsel;
EisnerAmper LLP as financial advisor, and Rust Omni as claims and
notice agent.
Assets total $158,587,999 at the end of 2012. The Debtors owe
approximately $56,206,821 in bond debt, and they have been told
that their pension liability is allegedly about $100,000,000 of
which the Debtors currently reflect $83,049,412 on their books.
KidsPeace sought Chapter 11 (i) as a means to implement a
negotiated restructuring of bond debt currently aggregating
approximately $51,310,000 plus accrued interest to a reduced
amount of approximately $24 million in new 30-year bonds with
interest at 7.5 percent, and (ii) to continue on-going
negotiations with the Pension Benefit Guaranty Corporation in
hopes of reducing the PBGC asserted obligation of $100+ million to
an amount that the Debtors can reasonably expect to satisfy.
The Debtor disclosed $157,930,467 in assets and $168,768,207 in
liabilities as of the Chapter 11 filing.
Since March 2012, MK has been exploring possible affiliation or
acquisition opportunities; however, no offer of an affiliation or
acquisition has been presented to the Debtors.
Gemino Healthcare Finance, LLC, the prepetition revolving lender,
is represented by James S. Rankin, Jr., Esq., at Parker, Hudson,
Rainer & Dobbs LLP; and Weir & Partners LLP's Walter Weir, Jr.,
Esq.
UMB Bank, N.A., on behalf of bondholders, Performance Food Group
d/b/a AFI, W.B. Mason Co., Inc., Pension Benefit Guaranty
Corporation, and Teresa Laudenslager were appointed to an official
committee of unsecured creditors in the Debtors' cases. The
Official Committee of Unsecured Creditors is represented by
Fitzpatrcik Lentz & Bubba, P.C., and Lowenstein Sandler LLP as
counsel. FTI Consulting, Inc. serves as the panel's financial
advisor.
KIT DIGITAL: Sues Content Solutions Owner Over $19MM Deal
---------------------------------------------------------
Law360 reported that bankrupt KIT Digital Inc. sued an entity
owned by the former manager of its content solutions business,
saying it has received none of the $18.8 million it was expecting
from the manager's acquisition of the assets last year.
According to the report, KIT said it acquired Brickbox Digital
Media sro at some point during its buying blitz of 2010 and 2011
for $13.6 million and named Petr Stransky, the CEO and principal
shareholder of Brickbox when it was acquired.
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.
LABELS UNLIMITE: Case Summary & 19 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Labels Unlimite, Inc.
Carretera 174, KM. 2.5 Barrio Minillas
Bayamon, PR 00960
Bankruptcy Case No.: 13-06318
Chapter 11 Petition Date: August 1, 2013
Court: U.S. Bankruptcy Court
District of Puerto Rico (Old San Juan)
Judge: Mildred Caban Flores
Debtor's Counsel: Carmen D. Conde Torres, Esq.
C. CONDE & ASSOC.
254 San Jose Street, 5th Floor
San Juan, PR 00901-1523
Tel: (787) 729-2900
Fax: (787) 729-2203
E-mail: notices@condelaw.com
Scheduled Assets: $1,393,623
Scheduled Liabilities: $2,861,635
A copy of the Company's list of its 19 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/prb13-06318.pdf
The petition was signed by Raul Ford, president.
LAKESHORE FRESH: Case Summary & 10 Unsecured Creditors
------------------------------------------------------
Debtor: Lakeshore Fresh Market, Inc.
9119 S. Sprinkle Road
Portage, MI 49002
Bankruptcy Case No.: 13-06163
Chapter 11 Petition Date: August 1, 2013
Court: U.S. Bankruptcy Court
Western District of Michigan (Grand Rapids)
Judge: Scott W. Dales
Debtor's Counsel: Cody H. Knight, Esq.
RAYMAN & KNIGHT
141 East Michigan Avenue, Suite 301
Kalamazoo, MI 49007
Tel: (269) 345-5156
E-mail: courtmail@raymanstone.com
Estimated Assets: $100,001 to $500,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 10 unsecured creditors is
available for free at http://bankrupt.com/misc/miwb13-06163.pdf
The petition was signed by Wendy L. Hoeksema, president.
Affiliate that filed separate Chapter 11 petition:
Entity Case No. Petition Date
------ -------- -------------
Sprinkle Road Investments, LLC 13-6161 8/01/2013
LEVEL 3 FINANCING: Moody's Rates New $815MM Term Loan 'Ba3'
-----------------------------------------------------------
Moody's Investors Service rated Level 3 Financing, Inc.'s new $815
million senior secured term loan Ba3. Financing is a wholly-owned
subsidiary of Level 3 Communications, Inc. (Level 3), the
guarantor of the facilities. Level 3's corporate family and
probability of default ratings remain unchanged at B3, B3-PD and
its speculative grade liquidity rating remains unchanged at SGL-1
(very good liquidity). In addition, the ratings outlook remains
stable.
Since the new credit facility replaces a same-sized facility with
substantially similar terms and conditions including the maturity
date, there are no ratings implications as the company's debt
level and its waterfall of liabilities remain unchanged.
Accordingly, the new facility is rated at the same Ba3 level as
the facility it replaces.
The following summarizes the rating action as well as Level 3's
ratings:
Assignments:
Issuer: Level 3 Financing, Inc.
Senior Secured Bank Credit Facility, Ba3 (LGD2, 10%)
Unchanged Ratings:
Issuer: Level 3 Communications, Inc.
Corporate Family Rating, unchanged at B3
Probability of Default Rating, unchanged at B3-PD
Speculative Grade Liquidity Rating, unchanged at SGL-1
Outlook, unchanged at Stable
Senior Unsecured Bond/Debenture, unchanged at Caa2 (LGD6, 92%)
Issuer: Level 3 Financing, Inc.
Senior Secured Bank Credit Facility, unchanged at Ba3 (LGD2,
10%)
Senior Unsecured Regular Bond/Debenture (including debts issued
by Level 3 Escrow, Inc. that have been assumed by Level 3
Financing, Inc.), unchanged at B3 (LGD4, 58%)
Ratings Rationale:
Level 3's B3 CFR is based on the company's limited ability to
generate modest free cash flow over the next 12-to-18 months and
the lack of visibility with respect to current and future activity
levels. Level 3 has a reasonable business proposition as a
facilities-based provider of optical, Internet protocol
telecommunications infrastructure and services, however, owing to
excess long-haul transport capacity, margins are relatively weak.
Moody's does not expect supply and demand balance to change and
therefore expect stable margins going forward. With no quantity or
price metrics disclosed by the company or its competitors,
visibility of current and future activity is very limited, a
credit negative. The rating is also based on the expectation that
there is sufficient liquidity to continue to fund investments in
synergy-related initiatives, and that the company's improving
credit profile facilitates repayment and/or roll-over of 2015 and
2016 debt maturities.
Rating Outlook
The stable ratings outlook is premised on the expectation the
Level 3 will be modestly cash flow positive (on a sustained
basis).
What Could Change the Rating - Up
In the event that Debt/EBITDA declines towards 5.0x and (RCF-
CapEx)/Debt advances beyond 5% (in both cases, inclusive of
Moody's adjustments and on a sustainable basis), positive ratings
actions may be warranted.
What Could Change the Rating - Down
Whether the result of execution mis-steps or adverse industry
conditions, should it appear that the company is not cash flow
self-sufficient, or in the event of significant debt-financed
acquisition activity, negative ratings activity may be considered.
The principal methodology used in this rating was the Global
Communications Infrastructure Industry Methodology published in
June 2011. Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.
Headquartered in Broomfield, Colorado, Level 3 Communications,
Inc. (Level 3) is a publicly traded international communications
company with one of the world's largest long-haul communications
and optical Internet backbones. Level 3's annual revenue is
approximately $6.4 billion and annual (Moody's adjusted) EBITDA is
$1.7 billion. Approximately 60% of revenue is generated in North
America, 14% in Europe, 11% in Latin America, while the remaining
15% of revenue is generated through other sources.
LEVEL 3 FINANCING: S&P Rates $815-Mil. Secured Term Loan 'BB-'
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned Level 3 Financing
Inc.'s $815 million tranche B-III secured term loan due 2019 an
issue-level rating of 'BB-', with a recovery rating of '1',
indicating S&P's expectation for very high (90% to 100%) recovery
of principal in the event of a default.
The company will use proceeds to refinance $815 million of
existing tranche B term loans due 2019. The 'B' corporate credit
rating on parent Level 3 Communications Inc. is unchanged as the
modest reduction in interest expense anticipated from this
refinancing would not materially change Level 3 Communications'
consolidated financial metrics. The rating outlook is stable.
Broomfield, Co.-based Level 3 Communications, a global
telecommunications provider, reported approximately $8.5 billion
of outstanding debt at June 30, 2013.
RATINGS LIST
Level 3 Communications Inc.
Corporate Credit Rating B/Stable/--
New Rating
Level 3 Financing Inc.
$815M tranche B-III secrd term loan due 2019 BB-
Recovery Rating 1
LIBERTYVIEW LEVERAGE: Barclays Exploits Bankruptcy for $17MM
------------------------------------------------------------
Law360 reported that a group of investment funds brought suit
against Barclays Bank PLC in New York state court alleging the
bank is taking advantage of the funds' bankruptcy in an attempt to
obtain $17 million more than it is due under a 2005 loan
agreement.
According to the report, LibertyView Leverage Plus Fund Ltd. and
its affiliates filed the complaint, claiming Barclays is using a
"flawed interpretation" by asserting that the bank is entitled to
an extra $17 million under an alleged early termination provision
after the funds' assets were frozen.
LIGHTSQUARED INC: Harbinger Sues Ergen, Sound Point et al.
----------------------------------------------------------
Philip Falcone's Harbinger Capital Partners LLC, HGW US Holding
Company LP, Blue LineDZM Corp., and Harbinger Capital Partners SP,
Inc., on Tuesday launched an adversary proceeding in LightSquared
Inc.'s Chapter 11 case in U.S. Bankruptcy Court for the Southern
District of New York against Charles W. Ergen, EchoStar
Corporation, Dish Network Corporation, L-Band Acquisition LLC, SP
Special Opportunities LLC, SP Special Opportunities Holdings LLC,
Sound Point CapitalManagement LP, and Stephen Ketchum.
Harbinger et al. seek redress against Mr. Ergen and the entities
he controls, for the Defendants' fraud and other tortious conduct
aimed at misappropriating Harbinger's control over and investment
in LightSquared, and destroying Harbinger's contractual rights and
business opportunities relating to that investment. The
Defendants, aided and abetted by SP Capital and Mr. Ketchum, the
founder and managing member of SP Capital, are engaged in a
fraudulent scheme, according to Harbinger et al., to:
(1) deprive Harbinger of its investment in and control of
LightSquared and its valuable wireless spectrum;
(2) prevent LightSquared -- a potential competitor to Dish
and EchoStar -- from emerging from bankruptcy under
Harbinger's control; and
(3) misappropriate the valuable spectrum assets at a
discount to their true value.
Harbinger et al. contend that the Defendants' fraudulent scheme
has materially harmed Harbinger's contractual rights and
opportunities as LightSquared's controlling shareholder, and will
improperly provide Mr. Ergen and his entities with an unfair
advantage as a bidder for the spectrum assets, absent relief from
the Bankruptcy Court. According to Harbinger et al., the
Defendants' misconduct has already harmed Harbinger, and, if their
scheme succeeds, will cause Harbinger billions of dollars in
additional damages.
Harbinger said the Defendants' tortious scheme had several
components. Among others, the Defendants fraudulently infiltrated
the senior-most tranche of LightSquared's capital structure,
secretly amassing, based on knowing misrepresentations of fact, a
position as the single largest holder of LightSquared's secured
debt obligations. Harbinger said the Dish/EchoStar Defendants
purchased the Loan Debt through Sound Point -- a new investment
vehicle created for this purpose, whose connection to Mr. Ergen
they deliberately concealed, despite Harbinger's diligent
inquiries.
Sound Point has been acquiring debt in LightSquared since at least
May 2012, and currently holds over $1 billion of LightSquared's
Loan Debt.
If Harbinger had known that Mr. Ergen was purchasing Loan Debt
based on false andmisleading statements, it would have directed
UBS AG -- the Administrative Agent under the Credit Agreement,
which was responsible for monitoring compliance with the "Eligible
Assigneee" provisions -- to stop authorizing those purchases, and
taken other steps to prevent Mr. Ergen's continued wrongful
intrusion into LightSquared's capital structure.
Harbinger et al. also said the Dish/EchoStar Defendants and Sound
Point disrupted Harbinger's efforts to negotiate a plan of
reorganization with LightSquared's lenders. They did so by
causing Sound Point to enter into binding commitments to purchase
hundreds of millions of dollars of Loan Debt from LightSquared's
existing lenders, but then refusing -- without justification or
excuse, and contrary to settled industry practice -- to settle
those trades. With those trades suspended in limbo for weeks
andthen months, Harbinger was unable to ascertain the true
identity of the holders of the largest block of Loan Debt. This
substantially impeded Harbinger's efforts to negotiate with a key
constituency -- LightSquared's lenders -- during the critical
"exclusivity period," in which the holders of Loan Debt and other
creditors were not entitled to propose a plan of reorganization.
Only after the exclusivity clock had almost run out did the
Defendants close the trades.
Harbinger also alleges that Sound Point induced investment banker
Jefferies LLC to enter into two "back-to-back" transactions with
other investment funds, with Jefferies as the middleman and Sound
Point as the ultimate buyer, for the purchase of bundled interests
in (a) Loan Debt and (b) LightSquared LP's preferred shares.
According to Harbinger, Sound Point knew that the investment funds
from which it arranged to make these bundled purchases were
involved in advanced negotiations with Harbinger over a consensual
plan, and that entering into these trades would disrupt the
negotiations. Moreover, Sound Point intentionally misrepresented
to Jefferies that it was permitted to acquire both types of
securities, despite knowing full well that it was prohibited from
acquiring the Loan Debt under the Credit Agreement, and the LP
Preferred under a Stockholders' Agreement. Sound Point then
refused to close the second leg of the "back-to-back" transaction
-- over $160 million in trades -- leaving Jefferies exposed to
millions of dollars in unclosed trades. That deliberate tortious
interference with Harbinger's relationship with Jefferies created
a significant additional road block to Harbinger's obtaining exit
financing from Jefferies on the original terms and time frame that
both Harbinger and Jefferies had contemplated.
Harbinger also said the Dish/EchoStar Defendants resorted to
another newly created investment vehicle, Defendant LBAC, to make
a low-ball, bad-faith bid for LightSquared's most valuable assets
-- its wireless spectrum licenses -- priced substantially below
their true value and at almost exactly the amount of the
outstanding Loan Debt obligations. In other words, these
Defendants made a bid that did little more than pay themselves
back on the debt that they had fraudulently acquired through the
manipulative schemes. The Defendants then improperly leaked the
confidential, heavily discounted bid to the press to further
disrupt Harbinger's capital raise, sowing confusion and doubt
among potential investors as to whether the spectrum assets had
sufficient value to serve as adequate collateral for raising exit
financing or other investment capital. According to Harbinger, if
the Ergen Bid prevails, the Dish/EchoStar Defendants would
unfairly profit from their fraud.
Harbiner et al. are represented by Marc E. Kasowitz, Esq., David
M. Friedman, Esq., Jed I. Bergman, Esq., and Christine A.
Montenegro, Esq., at Kasowitz, Benson, Torres& Friedman in New
York.
* * *
Alexandra Stevenson, writing for The New York Times DealBook,
reports that Mr. Falcone's complaint comes just over a week after
Mr. Ergen, the chairman of both Dish and EchoStar, raised a bid
for LightSquared to $2.2 billion from $2 billion. NY Times also
says Mr. Falcone and his Harbinger Capital Partners are seeking
damages of more than $2 billion.
According to NY Times, Willkie Farr & Gallagher, the law firm
representing Mr. Ergen, issued a statement Tuesday afternoon that
said: "The Harbinger complaint is without merit and is full of
mischaracterizations and factual inaccuracies. All trades relating
to LightSquared's bank debt were permitted under the terms of
LightSquared's credit agreement."
About LightSquared Inc.
LightSquared Inc. and 19 of its affiliates filed Chapter 11
bankruptcy petitions (Bankr. S.D.N.Y. Lead Case No. 12-12080) on
May 14, 2012, to resolve regulatory issues that have prevented it
from building its coast-to-coast integrated satellite 4G wireless
network.
LightSquared had invested more than $4 billion to deploy an
integrated satellite-terrestrial network. In February 2012,
however, the U.S. Federal Communications Commission told
LightSquared the agency would revoke a license to build out the
network as it would interfere with global positioning systems used
by the military and various industries. In March 2012, the
Company's partner, Sprint, canceled a master services agreement.
LightSquared's lenders deemed the termination of the Sprint
agreement would trigger cross-defaults under LightSquared's
prepetition credit agreements.
LightSquared and its prepetition lenders attempted to negotiate a
global restructuring that would provide LightSquared with
liquidity and runway necessary to resolve its issues with the FCC.
Despite working diligently and in good faith, however,
LightSquared and the lenders were not able to consummate a global
restructuring on terms acceptable to all interested parties.
Lawyers at Milbank, Tweed, Hadley & McCloy LLP serve as counsel to
the Debtors. Alvarez & Marsal North America, LLC, is the
financial advisor. Kurtzman Carson Consultants LLC serves as
claims and notice agent.
MEDEX ASSOCIATES: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: MedEx Associates, LLC
336 Georgia Avenue, Suite 207
North Augusta, SC 29841
Bankruptcy Case No.: 13-11359
Chapter 11 Petition Date: July 31, 2013
Court: United States Bankruptcy Court
Southern District of Georgia (Augusta)
Debtor's Counsel: John B. Long, Esq.
TUCKER, EVERITT, LONG, BREWTON & LANIER
P.O. Box 2426
Augusta, GA 30903
Tel: (706) 722-0771
Fax: (706) 722-7028
E-mail: jlong@thefirm453.com
Scheduled Assets: $307,538
Scheduled Liabilities: $3,650,792
A copy of the Company's list of its 20 largest unsecured
creditors, filed together with the petition, is available for free
at http://bankrupt.com/misc/gasb13-11359.pdf
The petition was signed by Hetal Thakore, MD, managing partner.
MF GLOBAL: Chapter 11 Trustee Seeks $1 Million Success Fee
----------------------------------------------------------
Joseph Checkler, writing for The Wall Street Journal, reports that
former Federal Bureau of Investigation Director Louis J. Freeh
wants a $1 million fee for success securing creditor recoveries in
the bankruptcy wind-down of MF Global Holdings Ltd., the failed
commodities firm led by former New Jersey Gov. Jon S. Corzine.
According to WSJ, in a filing Monday with U.S. Bankruptcy Court in
Manhattan, lawyers for Mr. Freeh said he brought "instant
credibility" when he was assigned to serve as MF Global's Chapter
11 trustee in November 2011. Mr. Freeh's lawyers asked for the
$1 million in addition to the more than $20 million billed by Mr.
Freeh and his legal teams for their hourly work on the case. Mr.
Freeh's hourly rate is $900.
The personal award must be approved by Judge Martin Glenn.
According to WSJ, Bernstein Shur's Robert Keach, Esq., a
bankruptcy lawyer who's monitoring fees in the AMR Corp. Chapter
11 case and who isn't involved in the MF Global case, said Mr.
Freeh made a "billing judgment" to seek about a quarter of what
the bankruptcy code allows. Mr. Keach said Mr. Freeh, who's
currently investigating alleged misconduct in the settlement
program BP PLC set up to compensate victims of the 2010 Gulf of
Mexico oil spill, may have sought the lower fee to avoid scrutiny.
WSJ recounts that Mr. Freeh was instrumental in negotiating a
three-way settlement with MF Global's U.K. unit and the trustee
for MF Global's brokerage unit, that serves as the basis of a
creditor-payment plan for MF Global filed by a group of hedge
funds. Under the confirmed plan in the MF Global case, holders of
about $1 billion in MF Global's unsecured bonds stand to recover
between 12 cents and 42 cents on the dollar for their claims,
while creditors with claims stemming from a $1.2 billion revolving
loan would recover between 27 cents and 80 cents. Most individual
customers of MF Global's brokerage, the liquidation of which is
still being managed by the brokerage trustee, have recovered most
of their funds that were caught up in the firm's collapse.
About MF Global
New York-based MF Global -- http://www.mfglobal.com/-- was one of
the world's leading brokers of commodities and listed derivatives.
MF Global provides access to more than 70 exchanges around the
world. The firm also was one of 22 primary dealers authorized to
trade U.S. government securities with the Federal Reserve Bank of
New York. MF Global's roots go back nearly 230 years to a sugar
brokerage on the banks of the Thames River in London.
On Oct. 31, 2011, MF Global Holdings Ltd. and MF Global Finance
USA Inc. filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y.
Case Nos. 11-15059 and 11-5058), after a planned sale to
Interactive Brokers Group collapsed. As of Sept. 30, 2011, MF
Global had $41,046,594,000 in total assets and $39,683,915,000 in
total liabilities.
On Nov. 7, 2011, the United States Trustee appointed the statutory
creditors' committee in the Debtors' cases. At the behest of the
Statutory Creditor's Committee, the Court directed the U.S.
Trustee to appoint a chapter 11 trustee. On Nov. 28, 2011, the
Bankruptcy Court entered an order approving the appointment of
Louis J. Freeh, Esq., of Freeh Group International Solutions, LLC,
as Chapter 11 trustee.
On Dec. 19, 2011, MF Global Capital LLC, MF Global Market Services
LLC and MF Global FX Clear LLC filed voluntary Chapter 11
petitions (Bankr. S.D.N.Y. Case Nos. 11-15808, 11-15809 and
11-15810). On Dec. 27, the Court entered an order installing Mr.
Freeh as Chapter 11 Trustee of the New Debtors.
On March 2, 2012, MF Global Holdings USA Inc. filed a voluntary
Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-10863), and Mr.
Freeh also was installed as its Chapter 11 Trustee.
Judge Honorable Martin Glenn presides over the Chapter 11 case.
J. Gregory Milmoe, Esq., Kenneth S. Ziman, Esq., and J. Eric
Ivester, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, serve
as bankruptcy counsel. The Garden City Group, Inc., serves as
claims and noticing agent. The petition was signed by Bradley I.
Abelow, Executive Vice President and Chief Executive Officer of MF
Global Finance USA Inc.
The Chapter 11 Trustee has tapped (i) Freeh Sporkin & Sullivan
LLP, as investigative counsel; (ii) FTI Consulting Inc., as
restructuring advisors; (iii) Morrison & Foerster LLP, as
bankruptcy counsel; and (iv) Pepper Hamilton as special counsel.
The Official Committee of Unsecured Creditors has retained
Capstone Advisory Group LLC as financial advisor, while lawyers at
Proskauer Rose LLP serve as counsel.
The Securities Investor Protection Corporation commenced
liquidation proceedings against MF Global Inc. to protect
customers. James W. Giddens was appointed as trustee pursuant to
the Securities Investor Protection Act. He is a partner at Hughes
Hubbard & Reed LLP in New York.
Jon Corzine, the former New Jersey governor and co-CEO of
Goldman Sachs Group Inc., stepped down as chairman and chief
executive officer of MF Global just days after the bankruptcy
filing.
In April 2013, the Bankruptcy Court approved MF Global Holdings'
plan to liquidate its assets.
MICROSEMI CORP: S&P Raises Corp. Credit Rating to 'BB'
------------------------------------------------------
Standard & Poor's Ratings Services said it raised its corporate
credit rating on Aliso Viejo, Calif.-based Microsemi Corp. to 'BB'
from 'BB-'. The outlook is stable.
In addition, S&P raised its issue-level rating to 'BB+' from 'BB'
on the company's $776 million senior secured credit facilities: a
$726 million term loan due 2020 and a $50 million revolving credit
facility maturing in 2015 as a result of the upgrade of the
corporate credit rating. The '2' recovery rating indicates
expectations for substantial (70% to 90%) recovery for lenders in
the event of payment default.
"The rating action reflects our revision of Microsemi's business
risk profile to 'fair' from 'weak,' based on the successful
integration of its acquisitions, as well as the maintenance of
consistent profitability through industry cycles," said Standard &
Poor's credit analyst Andrew Chang.
"The ratings on Microsemi Corp. reflect our expectation that the
company's expanded product and market position through
acquisitions will support consistent profitability in the
intermediate term despite potential risks from sequestration. In
addition, we expect the company to maintain leverage appropriate
for the "significant" financial risk profile through an industry
cycle," added Mr. Chang.
S&P now views Microsemi's business risk profile as "fair." The
acquisitions of Zarlink in 2011 and Actel in 2010 increased
Microsemi's scale and enhanced its transition to a provider of
integrated circuits with less reliance on commodity-like discrete
products. The company has also maintained consistent
profitability through industry cycles while diversifying its end
markets and transitioning to a "fab-lite" model. Within its
niches, the company's product positions are typically strong.
Microsemi has a long track record in the more stable aerospace,
defense, and security markets, which account for about half of its
revenues, to which it is often the primary or sole supplier. In
addition, difficult qualification standards due to the mission-
critical nature of its products provide significant barriers to
potential new entrants.
On the other hand, S&P notes that the company is partly dependent
on the level of defense spending; the defense and security segment
accounted for 31% of June quarterly revenues. In addition, in
certain end markets, the company competes against much larger
firms with greater financial resources and product breadth, such
as Texas Instruments Inc., Analog Devices Inc., and Maxim
Integrated Products Inc. S&P's assessment of the company's
management and governance is "fair."
MUD KING: Plan Exclusivity Extended to Nov. 1
---------------------------------------------
The U.S. Bankruptcy Court has approved Mud King Products, Inc.'s
motion to extend the exclusivity period to file a plan of
reorganization to Nov. 1, 2013, and through Dec. 31, 2013, to
confirm the Chapter 11 Plan.
The prior deadline for the Debtor to file its Chapter 11 Plan and
Disclosure Statement was Aug. 3, 2013. The exclusivity period to
confirm a plan was Oct. 2, 2013.
On May 31, 2013, the Debtor filed its Motion to Estimate the Claim
of National Oilwell Varco which is currently pending before the
Bankruptcy Court. Claims alleged by NOV in the NOV Litigation are
potentially substantial and allowance of the claim could
significantly impact any plan filed by the Debtor. Thus, the
Estimation Motion must be resolved before the Debtor can confirm a
plan.
A status conference on the Motion to Estimate is currently
scheduled for Aug. 27, 2013. NOV vigorously opposes the
Estimation Motion and has moved for dismissal of the Chapter 11
case.
A hearing on the motion to dismiss the chapter 11 case is set for
Aug. 27, 2013, at 9:30 a.m. at Houston, Courtroom 403.
About Mud King Products
Mud King Products, Inc., filed a Chapter 11 petition (Bank. S.D.
Tex. Case No. 13-32101) on April 5, 2013. The petition was signed
by Erich Mundinger as vice president. The Debtor disclosed
$18,959,158 in assets and $3,351,216 in liabilities as of the
Chapter 11 filing. Annie E Catmull, Esq., Melissa Anne Haselden,
Esq., Mazelle Sara Krasoff, Esq., and Edward L Rothberg, Esq., at
Hoover Slovacek, LLP, represent the Debtor in its restructuring
effort. Judge Karen K. Brown presides over the case.
The U.S. Trustee was unable to appoint an official committee of
unsecured creditor.
MURPHY OIL: Moody's Assigns 'Ba2' CFR & Rates $500MM Notes 'Ba3'
----------------------------------------------------------------
Moody's Investors Service assigned a Ba2 corporate family rating
and a Ba2-PD probability of default rating to Murphy Oil USA, Inc.
Additionally, Moody's assigned a Ba3 rating to the company's
proposed $500 million senior unsecured notes. Moody's also
assigned MUSA an SGL-2 Speculative Grade Liquidity rating. The
rating outlook is stable. The proceeds of the financing will be
used to fund MUSA's spin-off from Murphy Oil Corporation.
"Murphy Oil USA's debt protection measures are relatively good and
its relationship with Wal-Mart continues to drive traffic to its
stores", said Mickey Chadha, Senior Analyst at Moody's Investors
Service. "However, it lacks an established track record operating
as an independent company and the small size of its stores limits
the variety of higher margin merchandise it can offer", Chadha
further stated.
Ratings Rationale:
The Ba2 Corporate Family Rating reflects MUSA's relatively good
debt protection measures, its relationship with Wal-Mart which
provides a growth platform and traffic of value oriented
consumers, meaningful scale, good market position and geographic
reach, and Moody's opinion that consumer demand for motor fuel and
value priced convenience items will retain some degree of
stability regardless of economic conditions. The ratings are
constrained by MUSA's lack of an established track record
operating as an independent company, its low merchandise margins
and the high sales and earnings volatility related to motor fuel
sales which account for a substantial majority of the company's
revenue.
The following ratings are assigned:
Corporate Family Rating at Ba2
Probability of Default Rating at Ba2-PD
Proposed $500 million Senior Unsecured Notes maturing 2023 at Ba3
(LGD5, 85%)
Speculative Grade Liquidity Rating at SGL-2
The stable outlook reflects Moody's expectation that MUSA's
liquidity will remain good, credit metrics will not deteriorate
and business conditions will remain fairly stable in the next 12-
18 months.
An upgrade would require an established track record of operating
as an independent company and a balanced growth strategy that
supports the credit profile required of a higher rating. An
upgrade would also require at least good liquidity, a sustained
improvement in credit metrics driven in part by increasing higher
margin merchandise revenues and stronger operating performance of
its fuel business. Quantitatively an upgrade would require
debt/EBITDA sustained below 3.0 times and EBITA/interest sustained
near 4.5 times.
Deterioration in operating performance resulting in weakening of
liquidity or credit metrics could result in a downgrade. A growth
strategy that negatively impacts liquidity or metrics could also
pressure ratings. Specifically ratings could be downgraded if
debt/EBITDA is sustained above 4.0 times and EBITA/interest is
sustained below 3.0 times.
The principal methodology used in this rating was the Global
Retail Industry Methodology published in June 2011. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
MUSA primarily sells retail motor fuel products and convenience
merchandise through 1,179 (as of June 30, 2013) retail stations
almost all of which are in close proximity to Wal-Mart stores. The
company's retail stations are located in 23 states, primarily in
the Southern and Midwestern United States. Revenues were about $20
billion for the fiscal year 2012.
MURPHY OIL: S&P Assigns 'BB' CCR & Rates $500MM Notes 'BB'
----------------------------------------------------------
Standard & Poor's Ratings Services said it assigned El Dorado,
Ark.-based Murphy USA Inc. its 'BB' corporate credit rating. The
outlook is stable.
At the same time, S&P assigned a 'BB' issue-level rating (same as
the corporate credit rating) and a '3' recovery rating to Murphy
Oil USA Inc.'s (a subsidiary of Murphy USA) proposed issuance of
$500 million senior notes.
"The ratings on Murphy USA reflect Standard & Poor's assessment of
the company's "weak" business risk profile and "significant"
financial risk profile," said credit analyst Andy Sookram.
Murphy USA is a fuel retailer and a convenience store operator.
S&P's view of its weak business risk profile incorporates the
company's greater concentration of fuel sales, where it generates
about 90% of revenues, versus about 70% for peers such as The
Pantry Inc. and Susser Holdings Corp. It is exposed to fuel price
volatility that could pressure fuel margins and swing earnings and
cash flow; these factors are also reflected in S&P's financial
risk profile.
The stable outlook reflects S&P's expectation that credit
protection will remain in line with significant levels in the next
year. S&P forecasts fuel margins of around 11 cents a gallon,
leverage of about 2x and FFO to debt of about 30%. S&P expects
liquidity to remain adequate, with a largely undrawn revolver and
no near-term debt maturities.
S&P could lower the rating if operating performance weakens on
persistently rising fuel prices that squeeze earnings and cash
flows or intensified competitive pressures. Under this scenario,
fuel margins could decline to nine cents or lower and leverage
increases to about 3.2x or higher. In addition, S&P could take a
negative rating action if the company pursues large debt-financed
shareholder initiatives or acquisitions.
S&P do not anticipate a positive rating action in the next year,
given its expectation that the business risk profile will remain
weak. Still, an upgrade could occur if S&P revises the business
risk profile to fair on meaningful merchandise margin improvement
because of improved product assortment, and leverage remains
around 2x.
NORTHEAST WIND II: Moody's Rates New $385-Mil. Debt 'Ba3'
---------------------------------------------------------
Moody's Investors Service has assigned a Ba3 rating to Northeast
Wind Capital II, LLC's proposed $385 million of senior secured
first lien credit facilities. The facilities consist of a $325
million senior secured first lien term loan due 2020 and a $60
million senior secured first lien revolving letter of credit (LOC)
facility due 2018. This is the first time Moody's is rating NWC.
The rating outlook is stable.
NWC is a wholly-owned subsidiary of Northeast Wind Capital
Holdings LLC (Holdings), which owns 100% of the equity interests
in the Borrower and is a 100% owned subsidiary of Northeast Wind
Partners II, LLC (the Northeast JV), a joint venture 51%
indirectly owned by First Wind Holdings, LLC (First Wind: not
rated) and 49% by Emera Inc. (Emera: not rated). The Northeast JV
owns nine operating wind projects in the Northeast with a combined
generating capacity of 419 megawatts (MWs). Cash flows generated
from these assets will be the sole source of repayment for the
credit facilities.
Proceeds from the term loan will be used by the Borrower to repay
approximately $300 million of debt currently outstanding within
the Northeast JV. Upon completion of the proposed financing, all
nine projects will be debt-free; however, two projects (Mars Hill
and Bull Hill) will continue to be a party to a tax equity and
sale-leaseback structure, respectively, each of which will call on
the respective project-level cash flow.
The revolving credit facility will be used for the issuance of
letters of credits to support project-level obligations, to fund a
6-month debt service reserve account, and for a $10 million major
maintenance reserve account.
Ratings Rationale:
The Ba3 rating is supported by the fairly high degree of
contracted cash flows that are expected to be generated from the
Northeast JV's portfolio of operating wind projects and provided
to the Borrower to meet its debt service requirements. The rating
also takes into consideration Moody's assessment of the strong
political and regulatory support for renewable energy in the
northeastern US.
These credit positives are balanced by certain operating
challenges facing the Northeast JV and projected key financial
metrics that in combination, position NWC somewhat weakly in the
Ba3 rating category.
The nine projects owned by the Northeast JV have entered into off-
take agreements of various tenors and structures with multiple
credit-worthy counterparties. These contractual arrangements are
largely fixed priced and include purchase power agreements
(PPA's), financially-settled energy swaps (Swaps) and renewable
energy credit purchase and sales agreements (RECs). The tenor of
the PPA's and Swap's typically extend through 2019; however, a
fairly large portion of the RECs are short-term in nature
reflecting in part a lack of liquidity in that market.
According to Moody's estimates and utilizing the P90 case as a
starting point, about 90% of the aggregate expected cash flows
available for debt service to be generated by the Northeast JV in
2014 and 2015 will be from existing contractual arrangements,
declining to approximately 70% in 2016, 56% in 2017 and 50% in
2018. These percentages provide a fair degree of cash flow
predictability and score within the Ba range under the Rating
Methodology for Power Generation Projects (the Methodology)
published in December 2012. Moreover, Moody's calculates that
contracted cash flows alone under the P90 case are expected to
cover mandatory debt service (interest plus 1% annual principal
amortization) by at least 1.0 times through 2017.
The appreciable decline in the percentage of contracted cash flows
beginning 2017 is driven by the maturity of the short-term RECs.
The rating, however, recognizes the political and regulatory
support for renewable energy in the Northeast, a credit positive.
Specifically, all of the states where the Northeast JV's assets
are located (along with the neighboring states) have either
mandatory or voluntary renewable portfolio standards. Given these
standards, the limited risk of change to these requirements, and
the barriers to entry for new renewable resources in this region,
Moody's expects First Wind to be able to continue to enter into
incremental replacement RECs during the remaining tenor of the
financing.
Key risks include the termination last February of operating and
maintenance (O&M) and warranty agreements with Clipper Windpower,
LLC (Clipper), gearbox failures at the Clipper turbines, and
utility curtailment issues at three Maine plants, Stetson I & II
and Rollins. While steps have been taken to mitigate each of these
items, they represent significant and ongoing risks for the
Northeast JV and could, if unresolved, negatively impact the
Borrower's rating.
Four of the Northeast JV's projects (Cohocton, Steel Winds I,
Steel Winds II and Sheffield) utilize Clipper turbines.
Collectively, these projects account for approximately 200 MWs of
the 419 MWs of generating capacity in the joint venture and more
than 30% of total projected cash flows. Clipper's restructuring,
which occurred in 2012, ultimately led to the release of the
manufacturer from its warranty claims and the projects
transitioning their O&M and parts supply arrangements from Clipper
to affiliates of First Wind during the first quarter of 2013.
Moody's understands that providing O&M and part supply services to
wind projects represents a new business activity for First Wind,
which adds to this concern. To mitigate this issue and increase
the level of worker experience performing turbine maintenance,
First Wind has hired 11 former Clipper turbine technicians who
have been relocated to the various projects.
Additionally, the Northeast JV portfolio has been experiencing
gearbox failures at its Clipper sites. For example, since the
beginning of 2013, six gearboxes have failed at Cohocton and one
has failed at the Steel Winds which follows five gearbox failures
in 2012 occurring at Cohocton.
Because of the termination of the Clipper warranty, the total cost
to refurbish each gearbox failure (estimated by the Borrower to be
approximately $650,000 per incident) is incurred by the respective
project. The Northeast JV's strategy to mitigate the financial
implications associated with gearbox failures includes a First
Wind affiliate warehousing five spare gearboxes to minimize outage
time and replacing bearings during the refurbishment process with
those from a more reliable vendor. Also, Northeast JV's near-term
projections for O&M assume significant yearly gearbox
refurbishments and related costs (nine in 2014, seven in 2015 and
five in 2016) which are intended to address this issue. NWC will
have access to a $10 million major maintenance reserve account to
provide liquidity support for higher-than-anticipated levels of
gearbox failures.
Importantly, the remaining Northeast JV's projects utilize either
General Electric (GE) or Vestas turbines (with 84% of the
remaining MWs in the portfolio being GE turbines) and each project
is party to a long-term operating and maintenance services and
warranty coverage with their respective turbine manufacturer,
which provides some balance to the Clipper exposure.
Curtailment risk is another challenge affecting the company as
three of the Northeast JV's projects located in Bangor-Hydro's
service territory in northern Maine, Stetson I&II and Rollins,
have been curtailed by ISO-NE since 2012. The curtailment of the
projects has been caused by transmission constraints and has
reduced their respective generation outputs and cash flows. The
Northeast JV, however, appears to have identified a fairly low-
cost solution to remedy the constraint and the approach appears to
have the support of both Bangor-Hydro and ISO-NE. Additional
comfort is gained by the fact that even though curtailment risk
during 2012 at Stetson I&II reduced production to levels
consistent with the one-year P99 scenario, the projects were able
to generate enough electricity to satisfy required contractual
obligations with its respective counterparties. Assuming
regulatory approval to implement the fix, which involves re-
terminating Stetson and Rollin's existing transmission line, the
curtailment issue could be remedied as early as the first quarter
2014.
From a financial modeling perspective, key assumptions used in
management's base case include one-year P90 production levels,
merchant REC pricing assumptions provided by the market consultant
and gearbox refurbishment at $650,000 per incident, escalating 2%
annually. In Moody's base cases, it also assumes one-year P90
production levels, but with lower REC merchant pricing
assumptions, higher gearbox refurbishment costs and more onerous
assumptions relating to the curtailment of Stetson and Rollins.
Financial results in the cases examined do not differ materially
given the high degree of contracted cash flows through 2016. The
resulting key financial metrics of FFO to debt and debt service
coverage ratio in these scenarios range between 6-11% and 1.9
times-2.2 times, respectively, during the period 2014 through
2017, which score in the "B" rating category under the grid in the
Methodology.
The one exception is the Northeast JV's anticipated debt-to-
capitalization ratio, which in all cases examined scores in the
Baa rating category, reflecting somewhat modest leverage.
Lenders will be protected by fairly traditional project financing
structures, including a trustee administered waterfall of
accounts, a six month debt service reserve, a major maintenance
reserve account and a quarterly sweep of 50% of excess cash flow
to be used to repay debt. There will also be a minimum debt
service coverage requirement of 1.1 times.
All obligations under the credit facilities will be guaranteed by
Holdings and each of the Borrower's existing and subsequently
acquired or wholly-owned direct and indirect subsidiaries with the
exception of subsidiaries that own Mars Hill and Bull Hill, which
are subject to tax equity and sales leaseback structures. The
credit facilities will be secured by a first priority security
interest in the equity interest of each of the Borrower's existing
and subsequently acquired or wholly-owned direct and indirect
subsidiaries. Lenders will be supplied by a negative pledge that
will not permit the subsidiaries to incur obligations secured by
their assets, subject to customary exceptions.
Terms of the JV require that development projects identified by
First Wind, should they meet certain eligibility criteria, must
transfer to the Northeast JV. This was the case with Bull Hill, a
Maine project that achieved commercial operation in 2012. First
Wind has the ability to transfer up to an additional 1,166 MW of
new projects into the Northeast JV. To help facilitate this goal,
the financing has been structured to provide the flexibility to
add incremental pari- passu term loan debt to refinance
incremental qualified projects added to the Northeast JV.
While Moody's does not rate First Wind, it rates its affiliate
First Wind Capital, LLC (B3 Corporate Family Rating, positive
outlook). While this affiliate carries a deeply speculative grade
rating, Moody's believes that terms of the joint venture structure
insulate lenders from any related family contagion risk.
Specifically, the LLC Agreement requires that the Northeast JV be
managed by a Board of Managers consisting of five managers, three
appointed by First Wind and two by Emera. Certain actions by the
Board, such as the voluntary filing of any bankruptcy petition,
require the approval of at least four of the managers.
The ratings are predicated upon final documentation in accordance
with Moody's current understanding of the transaction and final
debt sizing and model outputs consistent with initially projected
credit metrics and cash flows.
Northeast Wind Capital II (NWC) is a wholly-owned subsidiary of
NewCo Holdings LLC, which owns 100% of the equity interests in NWC
and is a 100% owned subsidiary of Northeast Wind Partners II, LC
(the Northeast JV).
Formed in 2012, Northeast JV is 51% owned by First Wind and 49% by
Emera. First Wind serves as the managing partner and operates the
wind projects; Emera's affiliate Emera Energy provides energy
management services.
The principal methodology used in this rating was Power Generation
Projects published in December 2012.
NNN PARKWAY: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: NNN Parkway 400 2, LLC
4653 Carmel Mountain Rd Suite 308 #332
San Diego, CA 92130
Bankruptcy Case No.: 13-16598
Affiliates that simultaneously filed for Chapter 11:
Debtor Case No.
------ --------
NNN Parkway 400 3, LLC 13-16603
NNN Parkway 400 4, LLC 13-16608
NNN Parkway 400 5, LLC 13-16611
NNN Parkway 400 6, LLC 13-16612
NNN Parkway 400 7, LLC 13-16614
NNN Parkway 400 8, LLC 13-16616
NNN Parkway 400 9, LLC 13-16617
NNN Parkway 400 10, LLC 13-11978
NNN Parkway 400 11, LLC 13-16621
NNN Parkway 400 12, LLC 13-16623
NNN Parkway 400 13, LLC 13-16627
NNN Parkway 400 15, LLC 13-16628
NNN Parkway 400 16, LLC 13-16633
NNN Parkway 400 17, LLC 13-16634
NNN Parkway 400 18, LLC 13-16635
NNN Parkway 400 19, LLC 13-16636
NNN Parkway 400 20, LLC 13-16636
NNN Parkway 400 22, LLC 13-16638
NNN Parkway 400 23, LLC 13-16639
NNN Parkway 400 25, LLC 13-16641
NNN Parkway 400 28, LLC 13-16642
NNN Parkway 400 29, LLC 13-16643
NNN Parkway 400 30, LLC 13-16645
NNN Parkway 400 31, LLC 13-16646
NNN Parkway 400 35, LLC 13-16649
Chapter 11 Petition Date: August 2, 2013
Court: U.S. Bankruptcy Court
Central District of California (Santa Ana)
Judge: Theodor Albert
Debtor's Counsel: Evan D. Smiley, Esq.
WEILAND, GOLDEN, SMILEY ET. AL
650 Town Center Drive, Suite 950
Costa Mesa, CA 92626
Tel: (714) 966-1000
Fax: (714) 966-1002
E-mail: esmiley@wgllp.com
Estimated Assets: $10,000,001 to $50,000,000
Estimated Debts: $10,000,001 to $50,000,000
The petitions were signed by Mubeen Aliniazee, restructuring
officer.
An affiliate, NNN Parkway 400 26, LLC, sought Chapter 11
protection (Case No. 12-24593) on Dec. 31, 2012
NNN Parkway 400 2's List of Its 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Fulton County Tax Commissioner Taxes $360,000
P.O. Box 105052
Atlanta, GA 30348-5052
GXS, Inc. Security Deposit $80,252
11720 Amber Park Drive, Suite 100
Alpharetta, GA 30004
Media Brokers Int'l, Inc. Security Deposit $38,874
1170 Amber Park Drive, Suite 600
Alpharetta, GA 30004
Georgia Power Company Services $22,500
Charter Communications Holding Security Deposit $15,789
Mangan, Inc. Security Deposit $10,650
Dayforce, Inc. Security Deposit $10,053
Unique Building Maintenance Services $8,000
Admin America Security Deposit $6,843
Frederick Swanston, Inc. Security Deposit $6,560
Web Industries, Inc. Security Deposit $5,250
Polaris Associates, Inc. Security Deposit $4,083
Planmark Financial Group, Inc. Security Deposit $3,935
Urey Companies, LLC Security Deposit $3,683
Fulton County Finance Department -- $3,000
Allied Insurance Co. Insurance $3,000
Mirabeland Invesntments Inc. Security Deposit $2,681
Claims Verifications, Inc. Security Deposit $2,491
Valley Crest Services $2,058
Signature Baskets Services $1,528
NORTEL NETWORKS: Has Authority to Employ Punter as Pension Advisor
------------------------------------------------------------------
Nortel Networks Inc., et al., sought and obtained authority from
the U.S. Bankruptcy Court for the District of Delaware to employ
Punter Southall as a pension advisor.
For matters unrelated to the defense of claims asserted against
the Debtors, Punter Southall will be compensated at discounted
hourly rates ranging from GBP98 for a trainee actuary to GBP278
for a senior actuary.
For matters related to advice and consulting concerning the
defense of claims asserted against the Debtors, the firm will be
compensated at discounted hourly rates ranging from GBP120 for a
trainee to GBP330 for a senior actuary.
About Nortel Networks
Headquartered in Ontario, Canada, Nortel Networks Corporation and
its various affiliated entities provided next-generation
technologies, for both service provider and enterprise networks,
support multimedia and business-critical applications. Nortel did
business in more than 150 countries around the world. Nortel
Networks Limited was the principal direct operating subsidiary of
Nortel Networks Corporation.
On Jan. 14, 2009, Nortel Networks Inc.'s ultimate corporate parent
Nortel Networks Corporation, NNI's direct corporate parent Nortel
Networks Limited and certain of their Canadian affiliates
commenced a proceeding with the Ontario Superior Court of Justice
under the Companies' Creditors Arrangement Act (Canada) seeking
relief from their creditors. Ernst & Young was appointed to serve
as monitor and foreign representative of the Canadian Nortel
Group. That same day, the Monitor sought recognition of the CCAA
Proceedings in U.S. Bankruptcy Court (Bankr. D. Del. Case No.
09-10164) under Chapter 15 of the U.S. Bankruptcy Code.
That same day, NNI and certain of its affiliated U.S. entities
filed voluntary petitions for relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Del. Case No. 09-10138).
In addition, the High Court of England and Wales placed 19 of
NNI's European affiliates into administration under the control of
individuals from Ernst & Young LLP. Other Nortel affiliates have
commenced and in the future may commence additional creditor
protection, insolvency and dissolution proceedings around the
world.
On May 28, 2009, at the request of administrators, the Commercial
Court of Versailles, France, ordered the commencement of secondary
proceedings in respect of Nortel Networks S.A. On June 8, 2009,
Nortel Networks UK Limited filed petitions in U.S. Bankruptcy
Court for recognition of the English Proceedings as foreign main
proceedings under Chapter 15.
U.S. Bankruptcy Judge Kevin Gross presides over the Chapter 11 and
15 cases. Mary Caloway, Esq., and Peter James Duhig, Esq., at
Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as
Chapter 15 petitioner's counsel.
In the Chapter 11 case, James L. Bromley, Esq., at Cleary Gottlieb
Steen & Hamilton, LLP, in New York, serves as the U.S. Debtors'
general bankruptcy counsel; Derek C. Abbott, Esq., at Morris
Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware
counsel. The Chapter 11 Debtors' other professionals are Lazard
Freres & Co. LLC as financial advisors; and Epiq Bankruptcy
Solutions LLC as claims and notice agent.
The United States Trustee appointed an Official Committee of
Unsecured Creditors in respect of the U.S. Debtors. An ad hoc
group of bondholders also was organized.
Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Feld LLP, in
New York, and Christopher M. Samis, Esq., at Richards, Layton &
Finger, P.A., in Wilmington, Delaware, represent the Official
Committee of Unsecured Creditors.
An Official Committee of Retired Employees and the Official
Committee of Long-Term Disability Participants tapped Alvarez &
Marsal Healthcare Industry Group as financial advisor. The
Retiree Committee is represented by McCarter & English LLP as
Delaware counsel, and Togut Segal & Segal serves as the Retiree
Committee. The Committee retained Alvarez & Marsal Healthcare
Industry Group as financial advisor, and Kurtzman Carson
Consultants LLC as its communications agent.
Several entities, particularly, Nortel Government Solutions
Incorporated and Nortel Networks (CALA) Inc., have material
operations and are not part of the bankruptcy proceedings.
As of Sept. 30, 2008, Nortel Networks Corp. reported consolidated
assets of $11.6 billion and consolidated liabilities of $11.8
billion. The Nortel Companies' U.S. businesses are primarily
conducted through Nortel Networks Inc., which is the parent of
majority of the U.S. Nortel Companies. As of Sept. 30, 2008, NNI
had assets of about $9 billion and liabilities of $3.2 billion,
which do not include NNI's guarantee of some or all of the Nortel
Companies' about $4.2 billion of unsecured public debt.
Since the commencement of the various insolvency proceedings,
Nortel has sold its business units and other assets to various
purchasers. Nortel has collected roughly $9 billion for
distribution to creditors. Of the total, $4.5 billion came from
the sale of Nortel's patent portfolio to Rockstar Bidco, a
consortium consisting of Apple Inc., EMC Corporation,
Telefonaktiebolaget LM Ericsson, Microsoft Corp., Research In
Motion Limited, and Sony Corporation. The consortium defeated a
$900 million stalking horse bid by Google Inc. at an auction. The
deal closed in July 2011.
Nortel has filed a proposed plan of liquidation in the U.S.
Bankruptcy Court. The Plan generally provides for full payment on
secured claims with other distributions going in accordance with
the priorities in bankruptcy law.
Judge Gross and the court in Canada scheduled trials in 2014 on
how to divide proceeds among creditors in the U.S., Canada, and
Europe.
ORCHARD SUPPLY: Proposing Defective Bonuses, U.S. Trustee Says
--------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the U.S. Trustee is claiming that Orchard Supply
Hardware Stores Corp., whose stores go up for auction on Aug. 14,
proposed a bonus program for executives that's defective.
The report recounts that in June, San Jose, California-based
Orchard proposed a bonus program for the top five executives that
could pay them $3.13 million. If the sale brings in $200 million,
the top executives' bonus pool will be $2.16 million. If the
auction raises the price to $300 million, the bonus pool rises to
a maximum of $3.13 million.
In papers filed July 31, the Justice Department's bankruptcy
watchdog said the $200 million threshold requires nothing more
than completing the $205 million contract with Lowe's Cos. that
was negotiated before bankruptcy. Consequently, the program
amounts to retention bonuses banned by Congress, according to the
U.S. Trustee.
The company is proposing a separate bonus program paying as much
as $315,000 to lower-ranking managers. Bonuses would range from
$15,000 to $30,000. The U.S. Trustee said some of the proposed
recipients appear to have executive titles and thus aren't
entitled to bonuses for merely remaining with the company.
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.
OVERSEAS SHIPHOLDING: Exclusivity Extension Sought
--------------------------------------------------
BankruptcyData reported that Overseas Shipholding Group filed with
the U.S. Bankruptcy Court a motion to extend the exclusive period
during which the Company can file a Chapter 11 plan and solicit
acceptances thereof through and including November 30, 2013 and
January 31, 2014, respectively.
The motion explains, "By working constructively with all
constituents, the Debtors have made tremendous progress since the
Petition Date...to stabilize and rationalize the Debtors'
operations and put the Debtors on a path towards a successful
reorganization. In particular, the Debtors have analyzed and
developed long-term business plans that will form the operational
basis for a reorganized business and have commenced the claims
reconciliation and allowance process. The Debtors also completed
an extensive internal investigation and expect to file restated
financials dating back to the year ended December 31, 2000
shortly. However, given the size and complexity of the Debtors'
cases, as well as the remaining steps that must be undertaken for
the Debtors and their stakeholders to successfully formulate and
implement a Plan of reorganization, an extension of the Debtors'
Exclusive Periods is necessary."
About Overseas Shipholding
Overseas Shipholding Group, Inc., headquartered in New York, is
one of the largest publicly traded tanker companies in the world,
engaged primarily in the ocean transportation of crude oil and
petroleum products. OSG owns or operates 111 vessels that
transport oil and petroleum products throughout the world.
Overseas Shipholding Group and 180 affiliates filed voluntary
Chapter 11 petitions (Bankr. D. Del. Lead Case No. 12-20000) on
Nov. 14, 2012, disclosing $4.15 billion in assets and $2.67
billion in liabilities. Greylock Partners LLC Chief Executive
John Ray serves as chief reorganization officer. James L.
Bromley, Esq., and Luke A. Barefoot, Esq., at Cleary Gottlieb
Steen & Hamilton LLP serve as OSG's Chapter 11 counsel. Derek C.
Abbott, Esq., Daniel B. Butz, Esq., and William M. Alleman, Jr.,
at Morris, Nichols, Arsht & Tunnell LLP, serve as local counsel.
Chilmark Partners LLC serves as financial adviser. Kurtzman
Carson Consultants LLC is the claims and notice agent.
The Export-Import Bank of China, owed $312 million used for the
construction of five tankers, is represented by Louis R. Strubeck,
Jr., Esq., and Kristian W. Gluck, Esq., at Fulbright & Jaworski
LLP in Dallas; David L. Barrack, Esq., and Beret Flom, Esq., at
Fulbright & Jaworski in New York; and John Knight, Esq., and
Christopher Samis, Esq., at Richards Layton & Finger PA. Chilmark
Partners, LLC serves as financial and restructuring advisor.
Akin Gump Strauss Hauer & Feld LLP, and Pepper Hamilton LLP, serve
as co-counsel to the official committee of unsecured creditors.
FTI Consulting, Inc., is the financial advisor and Houlihan Lokey
Capital, Inc., is the investment banker.
PALIVODA WESTMORELAND: Case Summary & 4 Unsecured Creditors
-----------------------------------------------------------
Debtor: Palivoda Westmoreland Investments, LLC
dba Palivoda Westmoriland Investments, LLC
17248 Kings Highway
King George, VA 22485
Bankruptcy Case No.: 13-34178
Chapter 11 Petition Date: August 1, 2013
Court: U.S. Bankruptcy Court
Eastern District of Virginia (Richmond)
Judge: Douglas O. Tice Jr.
Debtor's Counsel: Paula S. Beran, Esq.
TAVENNER & BERAN, PLC
20 North Eighth Street, Second Floor
Richmond, VA 23219
Tel: (804) 783-8300
Fax: (804) 783-0178
E-mail: pberan@tb-lawfirm.com
Estimated Assets: $500,001 to $1,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its largest unsecured creditors is
available for free at http://bankrupt.com/misc/vaeb13-34178.pdf
The petition was signed by Stanley Palivoda, president.
Affiliate that filed separate Chapter 11 petition:
Entity Case No. Petition Date
------ -------- -------------
Stanley and Vivian Palivoda 13-32992 05/30/13
PHARMACEUTICAL ALTERNATIVES: App. Ct. Rules on MMO Suit Dismissal
-----------------------------------------------------------------
In the appellate case, MILLER v. MED. MUT. OF OHIO, Case No.
2012CA0020, Elise Miller and Pharmaceutical Alternatives, Inc.
appeal from the October 4, 2012, decision entered by the Coshocton
County Court of Common Pleas granting Medical Mutual of Ohio's
Civ.R. 12(B)(6) Motion to Dismiss a complaint against MMO.
Pharmaceutical Alternatives, Inc. (PAI) is a "closed-door
pharmacy" and provider of certain specialty pharmaceuticals which
contracted with Medical Mutual of Ohio (MMO), an Ohio provider of
health insurance. Elise Miller is the sole owner of PAI.
PAI and Ms. Elise filed a complaint against MMO on March 2012 in
the Court of Common Pleas for Coshocton County, alleging breach of
written contract, fraud and destruction of business through bad
faith in processing and paying insurance and guaranteed claims,
among other things. The trial court granted on Oct. 4, 2012, a
motion to dismiss filed by MMO. The Plaintiffs appealed the trial
court decision.
In a July 18, 2013 Opinion available at http://is.gd/zmtxVwfrom
Leagle.com, the Court of Appeals of Ohio, Fifth District, affirmed
in part, reversed in part and remanded for further proceedings the
trial court decision.
RICHARD T. ROBOL, Esq., and RACHEL CHODERA MONAGHAN, Esq. of ROBOL
LAW OFFICE, represent Pharmaceutical Alternatives Inc. and Elise
Miller.
CHRISTOPHER S. WILLIAMS, Esq., MAURA L. HUGHES, Esq., LAURA
McBRIDE, Esq., and MOLLY A DRAKE, as well as DAVID J. WIGHAM,
Esq., and STEVE J. SHROCK, Esq., represent Medical Mutual of Ohio.
About Pharmaceutical Alternatives
Pharmaceutical Alternatives, Inc., filed a voluntary petition
under Chapter 11 of the Bankruptcy Code on Nov. 5, 2008 in the
U.S. Bankruptcy Court for the Southern District of Ohio. On March
18, 2009, PAI's case was converted to one under Chapter 7 of the
Bankruptcy Code and William B. Logan was appointed trustee.
PICKERT DAIRY: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Pickert Dairy, LLC
19504 Weld County Road 5
Berthoud, CO 80513
Bankruptcy Case No.: 13-23084
Chapter 11 Petition Date: July 31, 2013
Court: United States Bankruptcy Court
District of Colorado (Denver)
Judge: A. Bruce Campbell
Debtor's Counsel: Jeffrey Weinman, Esq.
WEINMAN & ASSOCIATES, P.C.
730 17th St., Suite 240
Denver, CO 80202
Tel: (303) 572-1010
E-mail: jweinman@epitrustee.com
Scheduled Assets: $2,524,557
Scheduled Liabilities: $4,785,276
A copy of the Company's list of its 20 largest unsecured creditors
is available for free at http://bankrupt.com/misc/cob13-23084.pdf
The petition was signed by William B. Pickert, Jr.,
manager/member.
PRM FAMILY: Asks $700,00 in DIP Financing; Sept. 5 Hearing Set
--------------------------------------------------------------
The final hearing to consider the motion of PRM Family Holdings,
LLC, for authorization to obtain up to $700,000 in postpetition
financing on an unsecured administrative claim basis pursuant to
11 U.S.C. Section 364(b) will be held on Sept. 5, 2013, at 10:00
a.m.
According to papers filed with the Court on July 10, 2013, the
Debtors propose to borrow $700,000 from Pro and Son Holding, Inc.,
Pro's Ranch Markets Holding, Inc., Michael A. Provenzano, Jr.,
individually and as Trustee of the Survivor's Trust, Michal A.
Provenzano, III, individually and as trustee of the MAP III Trust,
Steven R. Provenzano, individually and as trustee of the SRP 2003
Trust, Richard S. Provenzano, individually and as trustee of the
RSP 2003 Trust, and Jeffrey C.Provenzano, individually and as
trustee of the JCP 2003 Trust outside of the ordinary course of
business to assist with expense of administration of the
bankruptcy estates and to maintain sufficient capital reserves.
The owners are willing to lend money at 6.5% with the loan
maturing on the effective date of confirmation of a plan of
reorganization.
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: Court Sets Hearing on Cash Collateral Motion
--------------------------------------------------------
At the July 16 hearing to consider the continued emergency motion
of PRM Family Holding Company, L.L.C.k to approve the proposed use
of cash collateral and setting final hearing, the U.S. Bankruptcy
Court for the District of Arizona ordered that a status conference
on cash collateral be set for Aug. 6, 2013, at 10:00 a.m. to see
if an order is in place or if another hearing is needed.
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.
PROMMIS HOLDINGS: Sept. 16 General Bar Date for EC Debtors
----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware established
Sept. 16, 2013, at 5:00 p.m. as the deadline for the filing of
proofs of claims in the Chapter 11 cases of EC Closing Corp., EC
Posting Closing Corp. and EC Closing Corp. of Washington.
Governmental units asserting a claim against the EC Debtors will
file a proof of claim by Dec. 23, 2013, at 5:00 p.m.
Proofs of claims are to be sent to Donlin Recano & Company, Inc.
About Prommis Holdings
Atlanta, Georgia-based Prommis Holdings, LLC, and its 10
affiliates delivered their petitions for voluntary bankruptcy
under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case
No. 13-10551) on March 18, 2013.
Three subsidiaries -- EC Closing Corp., EC Closing Corp. of
Washington, and EC Posting Closing Corp. -- sought Chapter 11
protection (Bankr. D. Del. Case Nos. 13-11619 to 13-11621) on
June 25, 2013.
Prommis Holdings estimated assets between $10 million and $50
million and debts between $50 million and $100 million. Prommis
Solutions, LLC, a debtor-affiliate disclosed $18,488,803 in assets
and $260,232,313 in liabilities as of the Chapter 11 filing.
Judge Brendan Linehan Shannon presides over the case. Steven K.
Kortanek, Esq., at Womble Carlyle Sandridge & Rice, LLP, serves as
the Debtors' counsel, while David S. Meyer, Esq., at Kirkland &
Ellis LLP serves as co-counsel. The Debtors' restructuring
advisor is Huron Consulting Services, LLC. Donlin Recano &
Company, Inc., is the Debtors' claims agent.
The Official Committee of Unsecured Creditors tapped Saul Ewing
LLP and Hahn & Hessen LLP as its co-counsels, and FTI Consulting,
Inc., as its financial advisor.
QUALITY DISTRIBUTION: Incurs $31.1 Million Net Loss in Q2
---------------------------------------------------------
Quality Distribution, Inc., reported a net loss of $31.14 million
on $239.29 million of total operating revenues for the three
months ended June 30, 2013, as compared with net income of $28.80
million on $212.73 million of total operating revenues for the
same period during the prior year.
For the six months ended June 30, 2013, the Company incurred a net
loss of $22 million on $468.71 million of total operating
revenues, as compared with net income of $35.50 million on $404.64
million of total operating revenues for the same period a year
ago.
As of June 30, 2013, the Company had $474.39 million in total
assets, $516.44 million in total liabilities and a $42.04 million
total shareholders' deficit.
"Our second quarter results were in line with our expectations,
particularly in our Energy Logistics segment," stated Gary Enzor,
chief executive officer. "Our Energy business achieved positive
adjusted operating income and nearly doubled its adjusted EBITDA
over the first quarter of 2013. Our Chemical Logistics business
had a difficult year-over-year comparison this quarter as the
additional company-operated terminals we assumed during the 2012
third quarter affiliate conversion operate at lower than standard
affiliate margins. However, by the end of this week, all of those
converted terminals will be re-affiliated. Our Intermodal business
continues to produce very strong results as we capitalize on solid
demand and generate margin improvements."
A copy of the press release is available for free at:
http://is.gd/k1EzdT
About Quality Distribution
Quality Distribution, LLC, and its parent holding company, Quality
Distribution, Inc., are headquartered in Tampa, Florida. The
company is a transporter of bulk liquid and dry bulk chemicals.
The company's 2010 revenues are approximately $686 million.
Apollo Management, L.P., owns roughly 30% of the common stock of
Quality Distribution, Inc.
Quality Distribution reported net income of $50.07 million for the
year ended Dec. 31, 2012, as compared with net income of $23.43
million in 2011.
Bankruptcy Warning
According to the Company's annual report for the period ended
Dec. 31, 2012, the Company had consolidated indebtedness and
capital lease obligations, including current maturities, of $418.8
million as of Dec. 31, 2012. The Company must make regular
payments under the ABL Facility and its capital leases and semi-
annual interest payments under its 2018 Notes.
The Company's 2018 Notes issued in the quarter ended Dec. 31,
2010, carry high fixed rates of interest. In addition, interest
on amounts borrowed under the Company's ABL Facility is variable
and will increase as market rates of interest increase. The
Company does not presently hedge against the risk of rising
interest rates. The Company's higher interest expense may reduce
its future profitability. The Company's future higher interest
expense and future redemption obligations could have other
important consequences with respect to the Company's ability to
manage its business successfully, including the following:
* it may make it more difficult for the Company to satisfy its
obligations for its indebtedness, and any failure to comply
with these obligations could result in an event of default;
* it will reduce the availability of the Company's cash flow to
fund working capital, capital expenditures and other business
activities;
* it increases the Company's vulnerability to adverse economic
and industry conditions;
* it limits the Company's flexibility in planning for, or
reacting to, changes in the Company's business and the
industry in which the Company operates;
* it may make the Company more vulnerable to further downturns
in its business or the economy; and
* it limits the Company's ability to exploit business
opportunities.
The ABL Facility matures August 2016. However, the maturity date
of the ABL Facility may be accelerated if the Company defaults on
its obligations.
"If the maturity of the ABL Facility and/or such other debt is
accelerated, we may not have sufficient cash on hand to repay the
ABL Facility and/or such other debt or be able to refinance the
ABL Facility and/or such other debt on acceptable terms, or at
all. The failure to repay or refinance the ABL Facility and/or
such other debt at maturity would have a material adverse effect
on our business and financial condition, would cause substantial
liquidity problems and may result in the bankruptcy of us and/or
our subsidiaries. Any actual or potential bankruptcy or liquidity
crisis may materially harm our relationships with our customers,
suppliers and independent affiliates."
* * *
As reported in the TCR on June 28, 2013, Moody's Investors Service
upgraded Quality Distribution, LLC's Corporate Family Rating to B2
from B3 and Probability of Default Rating to B2-PD from B3-PD.
The upgrade of Quality's CFR to B2 was largely driven by the
expectation that credit metrics will improve over the next twelve
to eighteen months, through a combination of EBITDA growth and
debt paydowns, to levels consistent with the B2 rating level. The
company is in the process of integrating the bolt-on acquisitions
made in its Energy Logistics business sector since 2011.
QUANTUM CORP: Posts $3.4 Million Net Income in Fiscal Q1
--------------------------------------------------------
Quantum Corp. reported net income of $3.39 million on $147.96
million of total revenue for the three months ended June 30, 2013,
as compared with a net loss of $16.66 million on $140.85 million
of total revenue for the same period during the prior year.
For the 12 months ended March 31, 2013, the Company incurred a net
loss of $52.41 million on $587.57 million of total revenue, as
compared with a net loss of $8.81 million on $652.37 million of
total revenue for the same period a year ago.
As of June 30, 2013, the Company had $358.41 million in total
assets, $435.71 million in total liabilities and a $77.31 million
stockholders' deficit.
"Our June quarter results clearly reflect the benefits of our
strong intellectual property portfolio and the actions we've taken
to drive growth and profit," said Jon Gacek, president and CEO of
Quantum. "With a few exceptions, our revenue performance was
generally good and in line with our expectations, and we were
particularly pleased by the double-digit growth we generated in
midrange DXi and overall StorNext(R) revenue. We also
significantly improved our gross margin rates and operating
income, even without the additional royalty revenue resulting from
the intellectual property agreement we concluded during the
quarter.
"Moving forward we will maintain our balanced approach of driving
revenue growth and spending wisely to generate cash and profit.
This will include the continued expansion of our data protection
and big data management offerings for physical, virtual and cloud
environments, leveraging our technology leadership to help
customers store, manage and quickly access their increasingly
valuable digital content throughout its lifecycle."
Quantum generated $9 million in cash from operations in FQ1'14,
ending the quarter with $80 million in total cash and cash
equivalents.
A copy of the press release is available for free at:
http://is.gd/aFMuiS
About Quantum Corp.
Based in San Jose, California, Quantum Corp. (NYSE:QTM) --
http://www.quantum.com/-- is a storage company specializing in
backup, recovery and archive. Quantum provides a comprehensive,
integrated range of disk, tape, and software solutions supported
by a world-class sales and service organization.
QUANTUM FUEL: Effects 1-for-4 Reverse Stock Split
-------------------------------------------------
Quantum Fuel Systems Technologies Worldwide, Inc.'s Board of
Directors has approved the implementation of a 1-for-4 reverse
stock split of its common stock, following approval by the
Company's stockholders on July 25, 2013. The reverse stock split
became legally effective at 11:59 p.m. on July 30, 2013. The
split-adjusted shares of the Company's common stock began trading
on NASDAQ on July 31, 2013. The Company's shares will continue to
trade under the symbol "QTWW." A new CUSIP number has been
assigned to the Company's common stock as a result of the reverse
stock split.
As a result of the reverse stock split, immediately upon the
Effective Date, each four shares of the Company's outstanding
common stock will automatically be combined into one share,
without any change to the par value per share. In addition, the
reverse stock split will effect a proportionate adjustment to the
number of shares of common stock the Company is authorized to
issue, the per share exercise price and the number of shares
issuable upon the exercise of outstanding warrants and stock
options and vesting of restricted stock awards, and the number of
shares eligible for issuance under the Company's 2011 Stock
Incentive Plan.
"We are pleased our stockholders approved the reverse stock split
which will enable us to regain compliance with Nasdaq's continued
listing requirements regarding the $1.00 minimum bid price,"
stated Brian Olson, Quantum's president and chief executive
officer. "We adopted a 1-for-4 ratio in order to minimize the
potential impact of the reverse. We remain excited about the
progress we are making in the business and opportunities in front
of us and believe this momentum coupled with the resulting
increase in our share price will provide broader appeal of our
stock to investors, particularly institutional investors."
Broadridge Corporate Issuer Solutions, Inc., will act as the
Company's Exchange Agent in connection with the reverse split.
Stockholders will receive the notices, forms and instructions
regarding the exchange of their pre-split shares for post-split
shares from the Exchange Agent or their broker. No fractional
shares will be issued. Stockholders who otherwise would be
entitled to receive fractional shares will automatically be
entitled to receive cash in lieu of the fractional share.
About Quantum Fuel
Lake Forest, Cal.-based Quantum Fuel Systems Technologies
Worldwide, Inc. (Nasdaq: QTWW) develops and produces advanced
vehicle propulsion systems, fuel storage technologies, and
alternative fuel vehicles. Quantum's portfolio of technologies
includes electronic and software controls, hybrid electric drive
systems, natural gas and hydrogen storage and metering systems and
other alternative fuel technologies and solutions that enable fuel
efficient, low emission, natural gas, hybrid, plug-in hybrid
electric and fuel cell vehicles.
Quantum Fuel disclosed a net loss attributable to stockholders of
$30.91 million in 2012 and a net loss attributable to common
stockholders of $38.49 million in 2011. The Company's balance
sheet at March 31, 2013, showed $58.40 million in total assets,
$49.77 million in total liabilities and $8.62 million in total
stockholders' equity.
Haskell & White LLP, in Irvine, California, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2012. The independent auditors noted
that the Company does not have sufficient existing sources of
liquidity to operate its business and service its debt obligations
for a period of at least twelve months. These conditions, along
with the Company's working capital deficit and recurring operating
losses, raise substantial doubt about the Company's ability to
continue as a going concern.
QUIGLEY CO: Confirmation Order Reaffirmed
-----------------------------------------
BankruptcyData reported that the U.S. District Court reaffirmed
the June 28, 2013 U.S. Bankruptcy Court order confirming Quigley's
Chapter 11 Plan of Reorganization. Because this proceeding
involved asbestos-related litigation, both Bankruptcy and District
Court approval was required, the report said.
About Quigley Co.
Quigley Co. was acquired by Pfizer in 1968 and sold small amounts
of products containing asbestos until the early 1970s. In
September 2004, Pfizer and Quigley took steps that were intended
to resolve all pending and future claims against the Company and
Quigley in which the claimants allege personal injury from
exposure to Quigley products containing asbestos, silica or mixed
dust. Quigley filed for bankruptcy in 2004 and has a Chapter 11
plan and a settlement with Chrysler.
Quigley filed for Chapter 11 bankruptcy protection (Bankr.
S.D.N.Y. Case No. 04-15739) on Sept. 3, 2004, to implement a
proposed global resolution of all pending and future asbestos-
related personal injury liabilities.
Lawrence V. Gelber, Esq., and Michael L. Cook, Esq., at Schulte
Roth & Zabel LLP, represent the Debtor in its restructuring
efforts. Elihu Inselbuch Esq., at Caplin & Drysdale, Chartered,
represents the Official Committee of Unsecured Creditors. When
the Debtor filed for protection from its creditors, it disclosed
$155,187,000 in total assets and $141,933,000 in total debts.
In April 2011, the bankruptcy judge approved a plan-support
agreement with Pfizer and an ad hoc committee representing 30,000
asbestos claimants.
A May 20, 2011 opinion by District Judge Richard Holwell concluded
that Pfizer was directly liable for some asbestos claims arising
from products sold by its now non-operating subsidiary Quigley.
The district court ruling was upheld in the appeals court.
R.I.K. REALTY: Case Summary & Unsecured Creditor
------------------------------------------------
Debtor: R.I.K. Realty LLC
4901 16th Avenue
Brooklyn, NY 11204
Bankruptcy Case No.: 13-44736
Chapter 11 Petition Date: July 31, 2013
Court: United States Bankruptcy Court
Eastern District of New York (Brooklyn)
Judge: Nancy Hershey Lord
Debtor's Counsel: Narissa A. Joseph, Esq.
LAW OFFICE OF NARISSA JOSEPH
277 Broadway, Suite 501
New York, NY 10007
Tel: (212) 233-3060
Fax: (212) 608-0304
E-mail: njosephlaw@aol.com
Scheduled Assets: $1,000,000
Scheduled Liabilities: $1,586,771
The Company's list of 20 largest unsecured creditors contains only
one entry:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Banco Popular Bank loan $1,586,771
7 West 51st Street
New York, NY 10019
The petition was signed by Joseph Gelbstein, president.
RADIOSHACK CORP: To Issue 16.7MM Shares Under 2013 Incentive Plan
-----------------------------------------------------------------
Radioshack Corporation registered with the U.S. Securities and
Exchange Commission 16.7 million shares of common stock issuable
under the Company's 2013 Omnibus Incentive Plan. The proposed
maximum aggregate offering price is $45.17 million. A copy of the
Form S-8 prospectus is available at http://is.gd/l0Y07i
About Radioshack Corporation
RadioShack (NYSE: RSH) -- -- http://www.radioshackcorporation.com
-- is a national retailer of innovative mobile technology products
and services, as well as products related to personal and home
technology and power supply needs. RadioShack's retail network
includes more than 4,300 company-operated stores in the United
States, 270 company-operated stores in Mexico, and approximately
1,000 dealer and other outlets worldwide.
Radioshack disclosed a net loss of $139.4 million in 2012, as
compared with net income of $72.2 million in 2011. As of June 30,
2013, the Company had $1.85 billion in total assets, $1.34 billion
in total liabilities and $506.6 million in total stockholders'
equity.
* * *
As reported by the TCR on Nov. 23, 2012, Standard & Poor's Ratings
Services lowered its corporate credit and senior unsecured debt
ratings on Fort Worth, Texas-based RadioShack Corp. to 'CCC+' from
'B-'. "The downgrade of RadioShack reflects our view that it will
be very difficult for the company to improve its gross margin in
the fourth quarter of this year, given the highly promotional
nature of year-end holiday retailing in the wireless and consumer
electronic categories," said Standard & Poor's credit analyst
Jayne Ross.
In the July 27, 2012, edition of the TCR, Fitch Ratings has
downgraded its long-term Issuer Default Rating (IDR) for
RadioShack Corporation to 'CCC' from 'B-'. The downgrade reflects
the significant decline in RadioShack's profitability, which has
become progressively more pronounced over the past four quarters.
As reported by the TCR on March 6, 2013, Moody's Investors Service
downgraded RadioShack Corporation's corporate family rating to
Caa1 from B3 and probability of default rating to Caa1-PD from B3-
PD. RadioShack's Caa1 Corporate Family Rating reflects Moody's
opinion that the overall business strategy of the company to
reverse the decline in profitability has not gained any traction.
REALAUCTION.COM LLC: Voluntary Chapter 11 Case Summary
------------------------------------------------------
Debtor: Realauction.com, LLC
861 SW 78th Ave, Suite 102
Plantation, FL 33324
Bankruptcy Case No.: 13-28260
Chapter 11 Petition Date: July 31, 2013
Court: United States Bankruptcy Court
Southern District of Florida (Fort Lauderdale)
Judge: Raymond B. Ray
Debtor's Counsel: Eyal Berger, Esq.
Catherine E Douglas, Esq.
AKERMAN SENTERFITT, P.A.
350 E Las Olas Blvd #1600
Ft Lauderdale, FL 33301
Tel: (954) 463-2700
Fax: (954) 463-2224
E-mail: eyal.berger@akerman.com
catherine.douglas@akerman.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $10,000,001 to $50,000,000
The Debtor did not file a list of its largest unsecured creditors
together with its petition.
The petition was signed by Marc David Thomashaw, chief financial
officer.
RESIDENTIAL CAPITAL: Suit Over Mortgage Servicing Deal Tossed
-------------------------------------------------------------
Maria Chutchian of BankruptcyLaw360 reported that a New York
bankruptcy judge tossed a lawsuit brought by American Residential
Equities LLC, trustee for purchasers of residential mortgage
loans, accusing a Residential Capital LLC unit of failing to pay
up under a servicing agreement, thus allowing the dispute to be
handled in Florida.
According to the report, U.S. Bankruptcy Judge Martin Glenn said
in a written opinion that he will lift the automatic stay so that
ARE's separate lawsuit alleging similar claims in Florida federal
court, which was already far along by the time ResCap entered
Chapter 11.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities at March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
ResCap sold most of the businesses for a combined $4.5 billion.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: Settles Class Suit Over "High-Cost" Loans
--------------------------------------------------------------
Joseph Checkler, writing for Dow Jones Business News, reported
that Residential Capital LLC has reached a deal with borrowers to
settle a class-action lawsuit over so-called high-cost mortgage
loans.
According to the report, in a filing with U.S. Bankruptcy Court in
Manhattan, ResCap said it will create a fund with no less than
$57.6 million, which will go to the borrowers on 44,535 second
mortgage loans.
The borrowers, who were suing ResCap over what they said was $1.87
billion in damages, will receive an allowed claim of $300 million
in ResCap's bankruptcy case, the report related. While ResCap
currently estimates that at least $27 million will be paid to the
borrowers, the fund created will be for more than double that,
just in case.
The deal, lawyers for ResCap and the borrowers said in their
filing, was "achieved in conjunction with the mediation process
overseen by Judge [James] Peck," who also helped ResCap creditors
and its parent reach the historic settlement that should lead to
the mortgage servicer's emergence from Chapter 11, the report
said.
The settlement works out to at least $606 per loan, although the
amount recovered should vary wildly and the total amount could
increase, the report added. A formula based on estimates of fees
and interest paid by the borrowers will determine their recovery.
Those whose loans closed before May 1, 2000, will get 18.5% less.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities at March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
ResCap sold most of the businesses for a combined $4.5 billion.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: Settles $1.87BB Suit for $57.6MM
-----------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Residential Capital LLC settled class lawsuits
pending for 10 years by homeowners who filed $1.87 billion in
claims for wrongful settlement charges and improper title
examination fees.
The class suits are pending in federal district court in
Pittsburgh on behalf of 70,000 homeowners who made about 44,500
high-cost second mortgages that were subject to federal
regulation. The loan were originated by banks and acquired by
ResCap.
In settlement, the class of homeowners will have an approved
unsecured claim against Residential Funding Co. in the amount of
$300 million. On account of the claim, $56.6 million will be
placed in a special trust for distribution to class members, after
payment of attorneys' fees. Each homeowner will receive a portion
of the trust funds based on that person's actual damages.
Representatives of the homeowners agreed to the plan support
agreement that underpins ResCap's Chapter 11 plan. The support
agreement doesn't require settlement of the homeowners' claims.
At the Aug. 21 hearing, the bankruptcy court will preliminarily
approve the class for settlement purposes and authorize sending
notices to the class about the settlement. There will be a later
hearing for approval of the settlement itself.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities at March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
ResCap sold most of the businesses for a combined $4.5 billion.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion.
The bankruptcy judge is also at the Aug. 21, 2013 hearing to
consider approval of explaining ResCap's Chapter 11 reorganization
plan. ResCap's plan is based largely on the settlement where the
parent Ally Financial Inc. will pay $2.1 billion in return for a
release of claims. Holders of ResCap's $2.15 billion in general
unsecured claims are scheduled for a 36.3 percent recovery,
according to the disclosure statement. Unsecured creditors with
$2 billion in claims against the GMACM companies are in line for
30.1 percent.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: FGIC Fires Back at Freddie Mac Over Deal
-------------------------------------------------------------
Law360 reported that Financial Guaranty Insurance Co. blasted
Freddie Mac's call for a New York bankruptcy judge to reject
Residential Capital LLC's recent deal with FGIC to slash the bond
insurer's claim by nearly $5 billion, claiming that objections by
investors were misguided and self-serving.
According to the report, the government-sponsored enterprise said
Monday that the settlement, which would reduce the claim from $5.5
billion to $596.5 million, would terminate insurance policies
guaranteeing the payment of principal and interest on mortgage-
backed securities it holds that were issued or serviced by ResCap.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities at March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
ResCap sold most of the businesses for a combined $4.5 billion.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
REVLON CONSUMER: Colomer Purchase Prompts Moody's Downgrade Watch
-----------------------------------------------------------------
Moody's Investors Service placed Revlon Consumer Products
Corporation's Ba3 Corporate Family Rating, Ba3-PD Probability of
Default Rating, and debt instrument ratings on review for
downgrade following the company's announced $660 million planned
acquisition of The Colomer Group, which is a privately-held beauty
care company focused on the professional salon channel. The review
reflects Moody's expectation that Revlon's debt-to-EBITDA leverage
will increase as a result of funding the acquisition with debt.
On Review for Possible Downgrade:
Issuer: Revlon Consumer Products Corporation
Corporate Family Rating, Placed on Review for Possible
Downgrade, currently Ba3
Probability of Default Rating, Placed on Review for Possible
Downgrade, currently Ba3-PD
Senior Secured Bank Credit Facility due Nov 19, 2017, Placed on
Review for Possible Downgrade, currently Ba2
Senior Unsecured Regular Bond/Debenture due Feb 15, 2021,
Placed on Review for Possible Downgrade, currently B1
Outlook Actions:
Issuer: Revlon Consumer Products Corporation
Outlook, Changed To Rating Under Review From Stable
Ratings Rationale:
Moody's will consider in the review the operating benefits from
acquiring TCG including the addition of the professional sales
channel, incremental geographic diversity and the potential
revenue and cost synergies. Moody's will also evaluate Revlon's
financial policies and plans to reduce leverage following the
acquisition including the planned use of free cash flow, which is
expected to increase as a result of the acquisition.
Revlon announced that it plans to repay its existing $675 million
senior secured term loan due 2017 in conjunction with the
acquisition, which Revlon's expects to close in the fourth
quarter. The proposed financing includes a new $1.375 billion six-
year senior secured term loan. Moody's would withdraw the Ba2
rating on the existing term loan if it is terminated in connection
with the transactions. If the existing term loan remains in place,
Moody's will consider the facility's priority of claim within the
revised debt structure. The incremental secured debt will likely
result in a downgrade of the B1 rating on the senior unsecured
notes due 2021 even if Moody's confirms Revlon's Ba3 CFR.
The principal methodology used in this rating was the Global
Packaged Goods published in June 2013. Other methodologies used
include Loss Given Default for Speculative-Grade Non-Financial
Companies in the U.S., Canada and EMEA published in June 2009.
Revlon, headquartered in New York, NY, is a worldwide cosmetics,
skin care, fragrance, and personal care products company. The
company is a wholly-owned subsidiary of publicly-traded Revlon,
Inc., which is majority-owned by MacAndrews & Forbes (M&F). M&F is
wholly-owned by Ronald O. Perelman. Revlon's principal brands
include Revlon, Almay, Sinful Colors, Pure Ice, Charlie, Jean
Nate, Mitchum, Gatineau, and Ultima II. Revlon's net sales for the
12 months ended June 2013 were approximately $1.4 billion.
REVSTONE INDUSTRIES: Metavation Seeks OK of Huron as CRO
--------------------------------------------------------
Metavation, LLC, seeks permission from the Bankruptcy Court to
employ Huron Consulting Services LLC to provide John C. DiDonato
as chief restructuring officer and additional personnel to the
Debtor.
Huron was originally retained by Revstone Industries, LLC, and
Spara, LLC, subsdiaries of the Debtor. "Huron has acquired
significant knowledge of Metavation and its business and is now
familiar with Metavation's financial affairs, debt structure,
operations and related matters," said Daniel V. Smith, Esq.,
secretary and general counsel of Metavation.
Huron will, among other things:
* compile data and documents necessary to support the Debtor in
its bankruptcy proceeding;
* negotiate and document the terms of a debtor-in-possession
and other financing arrangements;
* develop plans to address creditor requirements and interface
with creditors and their financial advisors; and
* develop a plan of reorganization or liquidation, and
supporting documents.
Under the engagement Letter, Mr. DiDonato will receive an hourly
rate of $750. In addition to Mr. DiDonato, these individuals were
appointed to officer positions:
Individual Position Hourly Rate
---------------- ---------- -----------
James M. Lukenda Deputy CRO $725
Laura Marcero Deputy CRO $700
Brian Linscott Interim CFO $700
Geoff Frankel Vice President $725
John Owens Interim Treasurer $565
John Hemingway Interim Assistant Treasurer $550
The Debtor will also pay additional personnel of Huron based on
these standard hourly billing rates:
Title Hourly Rate
----------------- -----------
Managing Director $675-$750
Senior Director and Director $535-$620
Manager $420-$450
Associate $350
Analyst $250
The Debtor will reimburse Huron for reasonable direct expenses it
incurred during the engagement.
Prior to Huron's retention, Metavation provided the firm with a
retainer of $250,000. The retainer will be credited against any
amounts due from Metavation at the termination of the Engagement
Letter and returned to the Debtor upon the satisfaction of all
obligations owed to Huron.
Mr. DiDonato, managing director of Huron, assured the Court that
his firm represents no interest adverse to the interest of
Metavation or the estate and is "disinterested" as that term is
defined in Section 101(14) of the Bankruptcy Code.
About Revstone Industries, Greenwood Forgings,
& US Tool & Engineering
Lexington, Kentucky-based Revstone Industries LLC, a maker of
truck parts, filed for Chapter 11 bankruptcy (Bankr. D. Del. Case
No. 12-13262) on Dec. 3, 2012. Judge Brendan Linehan Shannon
oversees the case. In its petition, Revstone estimated under
$50 million in assets and debts.
Affiliate Spara LLC filed its Chapter 11 petition (Bankr. D. Del.
Case No. 12-13263) on Dec. 3, 2012.
Lexington-based Greenwood Forgings, LLC (Bankr. D. Del. Case No.
13-10027) and US Tool & Engineering LLC (Bankr. D. Del. Case No.
13-10028) filed separate Chapter 11 petitions on Jan. 7, 2013.
Judge Shannon also oversees the cases.
A motion for joint administration of the cases has been filed.
Duane David Werb, Esq., at Werb & Sullivan, serves as bankruptcy
counsel to Greenwood and US Tool. Greenwood estimated $1 million
to $10 million in assets and $10 million to $50 million in debts.
US Tool & Engineering estimated under $1 million in assets and
$1 million to $10 million in debts. The petitions were signed by
George S. Homeister, chairman.
Metavation, also known as Hillsdale Automotive, LLC, joined parent
Revstone in Chapter 11 on July 22, 2013 (Bankr. D. Del. Case No.
13-11831) to sell the bulk of its assets to industry rival Dayco
for $25 million, absent higher and better offers.
REVSTONE INDUSTRIES: Metavation Hires McDonald as Special Counsel
-----------------------------------------------------------------
Metavation, LLC, asks the Bankruptcy Court to approve the
employment of McDonald Hopkins PLC as its special counsel. The
Debtor expects that McDonald Hopkins will continue to provide
services to the Debtor with regard to matters that were
customarily handled by McDonald Hopkins prior to the Petition
Date.
During the five months prior to the Petition Date, McDonald
Hopkins performed substantial legal work for the Debtor and was
retained solely to represent the Debtor in negotiating with its
customers and, if necessary, to obtain funding and other
accommodations from its customers.
The hourly rates of McDonald Hopkins are:
Members $315-$690
Of-Counsel $330-$650
Associates $200-$380
Paralegals $155-$255
Law Clerks $40-$125
Within one year prior to the Petition Date, the Debtor paid
McDonald Hopkins $644,893.
The Debtor has agreed to reimburse the firm for reasonable and
documented out-of-pocket expenses incurred in connection with its
services.
About Revstone Industries, Greenwood Forgings,
& US Tool & Engineering
Lexington, Kentucky-based Revstone Industries LLC, a maker of
truck parts, filed for Chapter 11 bankruptcy (Bankr. D. Del. Case
No. 12-13262) on Dec. 3, 2012. Judge Brendan Linehan Shannon
oversees the case. In its petition, Revstone estimated under
$50 million in assets and debts.
Affiliate Spara LLC filed its Chapter 11 petition (Bankr. D. Del.
Case No. 12-13263) on Dec. 3, 2012.
Lexington-based Greenwood Forgings, LLC (Bankr. D. Del. Case No.
13-10027) and US Tool & Engineering LLC (Bankr. D. Del. Case No.
13-10028) filed separate Chapter 11 petitions on Jan. 7, 2013.
Judge Shannon also oversees the cases.
A motion for joint administration of the cases has been filed.
Duane David Werb, Esq., at Werb & Sullivan, serves as bankruptcy
counsel to Greenwood and US Tool. Greenwood estimated $1 million
to $10 million in assets and $10 million to $50 million in debts.
US Tool & Engineering estimated under $1 million in assets and
$1 million to $10 million in debts. The petitions were signed by
George S. Homeister, chairman.
Metavation, also known as Hillsdale Automotive, LLC, joined parent
Revstone in Chapter 11 on July 22, 2013 (Bankr. D. Del. Case No.
13-11831) to sell the bulk of its assets to industry rival Dayco
for $25 million, absent higher and better offers.
REVSTONE INDUSTRIES: Metavation Hires Pachulski Stang as Counsel
----------------------------------------------------------------
Metavation, LLC, seeks permission from the Bankruptcy to employ
Pachulski Stang Ziehl & Jones LLP as its counsel nunc pro tunc to
the Petition Date. Pachulski Stang also serves as counsel to
Debtors Revstone Industries, LLC, and Spara, LLC.
Under the Engagement Letter, Pachulski Stang will:
(a) provide legal advice with respect to the Debtor's powers
and duties as debtor-in-possession in the continued
operation of the businesses and management of its property;
(b) prepare on behalf of the Debtor any necessary applications,
motions, answers, orders, reports, and other legal papers;
(c) appear in Court on behalf of the Debtor;
(d) prepare and pursue confirmation of a plan and approval of a
disclosure statement; and
(e) perform other legal services for the Debtor that may be
necessary and proper in these proceedings.
The principal attorneys and paralegals presently designated to
represent the Debtor and their current standard hourly rates are:
Name Rate/Hour
---------------------- ---------
Laura Davis Jones $975
Alan J. Kornfeld $895
David M. Bertentha l $825
Timothy P. Cairns $575
Colin R. Robinson $575
Peter J.Keane $425
Monica Molitor $295
The Debtor has agreed to reimburse Pachulski Stang for all other
expenses it incurred in connection with the Debtor's case.
Pachulski Stang has received $250,000 in connection with its
prepetition representation of the Debtor.
Laura Davis Jones, Esq., a partner at Pachulski Stang, assures the
Court that her firm is a "disinterested person" as that term is
defined in Section 101(14) of the Bankruptcy Code.
About Revstone Industries, Greenwood Forgings,
& US Tool & Engineering
Lexington, Kentucky-based Revstone Industries LLC, a maker of
truck parts, filed for Chapter 11 bankruptcy (Bankr. D. Del. Case
No. 12-13262) on Dec. 3, 2012. Judge Brendan Linehan Shannon
oversees the case. In its petition, Revstone estimated under
$50 million in assets and debts.
Affiliate Spara LLC filed its Chapter 11 petition (Bankr. D. Del.
Case No. 12-13263) on Dec. 3, 2012.
Lexington-based Greenwood Forgings, LLC (Bankr. D. Del. Case No.
13-10027) and US Tool & Engineering LLC (Bankr. D. Del. Case No.
13-10028) filed separate Chapter 11 petitions on Jan. 7, 2013.
Judge Shannon also oversees the cases.
A motion for joint administration of the cases has been filed.
Duane David Werb, Esq., at Werb & Sullivan, serves as bankruptcy
counsel to Greenwood and US Tool. Greenwood estimated $1 million
to $10 million in assets and $10 million to $50 million in debts.
US Tool & Engineering estimated under $1 million in assets and
$1 million to $10 million in debts. The petitions were signed by
George S. Homeister, chairman.
Metavation, also known as Hillsdale Automotive, LLC, joined parent
Revstone in Chapter 11 on July 22, 2013 (Bankr. D. Del. Case No.
13-11831) to sell the bulk of its assets to industry rival Dayco
for $25 million, absent higher and better offers.
REVSTONE INDUSTRIES: Creditors Balk at Pachulski Fee Allocations
----------------------------------------------------------------
Law360 reported that contention over representation in the
Revstone Industries LLC bankruptcy case continued with creditors
setting their sights on the debtor's main counsel Pachulski Stang
Ziehl & Jones LLP, arguing that it's not clear exactly how the
firm is allocating its services among the debtor's various
affiliates.
According to the report, secured creditor Boston Finance Group LLC
and the official committee of unsecured creditors both objected to
Pachulski Stang's monthly fee application contending that the
documents don't include a breakdown of how much of the firm's time
was spent working for.
About Revstone Industries, Greenwood Forgings,
& US Tool & Engineering
Lexington, Kentucky-based Revstone Industries LLC, a maker of
truck parts, filed for Chapter 11 bankruptcy (Bankr. D. Del. Case
No. 12-13262) on Dec. 3, 2012. Judge Brendan Linehan Shannon
oversees the case. In its petition, Revstone estimated under
$50 million in assets and debts.
Affiliate Spara LLC filed its Chapter 11 petition (Bankr. D. Del.
Case No. 12-13263) on Dec. 3, 2012.
Lexington-based Greenwood Forgings, LLC (Bankr. D. Del. Case No.
13-10027) and US Tool & Engineering LLC (Bankr. D. Del. Case No.
13-10028) filed separate Chapter 11 petitions on Jan. 7, 2013.
Judge Shannon also oversees the cases.
A motion for joint administration of the cases has been filed.
Duane David Werb, Esq., at Werb & Sullivan, serves as bankruptcy
counsel to Greenwood and US Tool. Greenwood estimated $1 million
to $10 million in assets and $10 million to $50 million in debts.
US Tool & Engineering estimated under $1 million in assets and
$1 million to $10 million in debts. The petitions were signed by
George S. Homeister, chairman.
Revstone is under attack by creditors. The committee filed a
proposed Chapter 11 reorganization plan giving ownership to
unsecured creditors and wiping out existing equity holdings.
Secured creditor Boston Finance Group LLP is seeking conversion of
the Chapter 11 cases of two Revstone subsidiaries to liquidations
in Chapter 7, where a trustee would make distributions of
remaining assets without a Chapter 11 plan.
Metavation, also known as Hillsdale Automotive, LLC, joined parent
Revstone in Chapter 11 on July 22, 2013 (Bankr. D. Del. Case No.
13-11831) to sell the bulk of its assets to industry rival Dayco
for $25 million, absent higher and better offers.
RG STEEL: Seeks Court Authority to Hire APS International as Agent
------------------------------------------------------------------
RG Steel Sparrows Point, LLC seeks approval from the U.S.
Bankruptcy Court for the District of Delaware to hire APS
International.
RG Steel tapped the firm to serve as its agent in connection with
the lawsuits it lodged against Union Electric Steel Corp. and The
Davy Roll Company, Ltd. APS' primary task as agent is to serve
complaints and summons on the defendants.
Judge Kevin Carey will hold a hearing on September 10 to consider
approval of the request. Objections are due by August 21.
About RG Steel
RG Steel LLC -- http://www.rg-steel.com/-- is the United States'
fourth-largest flat-rolled steel producer with annual steelmaking
capacity of 7.5 million tons. It was formed in March 2011
following the purchase of three steel facilities located in
Sparrows Point, Maryland; Wheeling, West Virginia and Warren,
Ohio, from entities related to Severstal US Holdings LLC. RG
Steel also owns finishing facilities in Yorkville and Martins
Ferry, Ohio. It also owned Wheeling Corrugating Company and has a
50% ownership in Mountain State Carbon and Ohio Coatings Company.
RG Steel along with affiliates, including WP Steel Venture LLC,
sought bankruptcy protection (Bankr. D. Del. Lead Case No. 12-
11661) on May 31, 2012. Bankruptcy was precipitated by liquidity
shortfall and a dispute with Mountain State Carbon, LLC, and a
Severstal affiliate, that restricted the shipment of coke used in
the steel production process.
The Debtors estimated assets and debts in excess of $1 billion.
As of the bankruptcy filing, the Debtors owe (i) $440 million,
including $16.9 million in outstanding letters of credit, to
senior lenders led by Wells Fargo Capital Finance, LLC, as
administrative agent, (ii) $218.7 million to junior lenders, led
by Cerberus Business Finance, LLC, as agent, (iii) $130.5 million
on account of a subordinated promissory note issued by majority
owner The Renco Group, Inc., and (iv) $100 million on a secured
promissory note issued by Severstal.
Judge Kevin J. Carey presides over the case.
The Debtors are represented in the case by Robert J. Dehney, Esq.,
and Erin R. Fay, Esq., at Morris, Nichols, Arsht & Tunnell LLP,
and Matthew A. Feldman, Esq., Shaunna D. Jones, Esq., Weston T.
Eguchi, Esq., at Willkie Farr & Gallagher LLP, represent the
Debtors. Conway MacKenzie, Inc., serves as the Debtors' financial
advisor and The Seaport Group serves as lead investment banker.
Donald MacKenzie of Conway MacKenzie, Inc., as CRO. Kurtzman
Carson Consultants LLC is the claims and notice agent.
Wells Fargo Capital Finance LLC, as Administrative Agent, is
represented by Jonathan N. Helfat, Esq., and Daniel F. Fiorillo,
Esq., at Otterbourg, Steindler, Houston & Rosen, P.C.; and Laura
Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachuiski Stang
Ziehi & Jones LLP.
Renco Group is represented by lawyers at Cadwalader, Wickersham &
Taft LLP.
Kramer Levin Naftalis & Frankel LLP represents the Official
Committee of Unsecured Creditors. Huron Consulting Services LLC
serves as the Committee's financial advisor.
The Debtor has sold off the principal plants. The sale of the
Wheeling Corrugating division to Nucor Corp. brought in $7
million. That plant in Sparrows Point, Maryland, fetched the
highest price, $72.5 million. CJ Betters Enterprises Inc. paid
$16 million for the Ohio plant.
RG STEEL: Wins Approval to Sell Asset to CH Maryland for $100,000
-----------------------------------------------------------------
U.S. Bankruptcy Judge Kevin Carey gave RG Steel Sparrows Point LLC
the go-signal to sell its equity interests in Bethlehem Roll
Technologies LLC to C.H. Maryland Inc.
In an August 1 decision, Judge Carey approved the sale of the
steel maker's equity interests, comprised of 100 units in
Bethlehem Roll, for $100,000. The bankruptcy judge granted C.H.
Maryland the protections afforded by Section 363(m) of the
Bankruptcy Code.
C.H. Maryland is RG Steel's joint venture partner in, and owns the
other equity interests in Bethlehem Roll.
About RG Steel
RG Steel LLC -- http://www.rg-steel.com/-- is the United States'
fourth-largest flat-rolled steel producer with annual steelmaking
capacity of 7.5 million tons. It was formed in March 2011
following the purchase of three steel facilities located in
Sparrows Point, Maryland; Wheeling, West Virginia and Warren,
Ohio, from entities related to Severstal US Holdings LLC. RG
Steel also owns finishing facilities in Yorkville and Martins
Ferry, Ohio. It also owned Wheeling Corrugating Company and has a
50% ownership in Mountain State Carbon and Ohio Coatings Company.
RG Steel along with affiliates, including WP Steel Venture LLC,
sought bankruptcy protection (Bankr. D. Del. Lead Case No. 12-
11661) on May 31, 2012. Bankruptcy was precipitated by liquidity
shortfall and a dispute with Mountain State Carbon, LLC, and a
Severstal affiliate, that restricted the shipment of coke used in
the steel production process.
The Debtors estimated assets and debts in excess of $1 billion.
As of the bankruptcy filing, the Debtors owe (i) $440 million,
including $16.9 million in outstanding letters of credit, to
senior lenders led by Wells Fargo Capital Finance, LLC, as
administrative agent, (ii) $218.7 million to junior lenders, led
by Cerberus Business Finance, LLC, as agent, (iii) $130.5 million
on account of a subordinated promissory note issued by majority
owner The Renco Group, Inc., and (iv) $100 million on a secured
promissory note issued by Severstal.
Judge Kevin J. Carey presides over the case.
The Debtors are represented in the case by Robert J. Dehney, Esq.,
and Erin R. Fay, Esq., at Morris, Nichols, Arsht & Tunnell LLP,
and Matthew A. Feldman, Esq., Shaunna D. Jones, Esq., Weston T.
Eguchi, Esq., at Willkie Farr & Gallagher LLP, represent the
Debtors. Conway MacKenzie, Inc., serves as the Debtors' financial
advisor and The Seaport Group serves as lead investment banker.
Donald MacKenzie of Conway MacKenzie, Inc., as CRO. Kurtzman
Carson Consultants LLC is the claims and notice agent.
Wells Fargo Capital Finance LLC, as Administrative Agent, is
represented by Jonathan N. Helfat, Esq., and Daniel F. Fiorillo,
Esq., at Otterbourg, Steindler, Houston & Rosen, P.C.; and Laura
Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachuiski Stang
Ziehi & Jones LLP.
Renco Group is represented by lawyers at Cadwalader, Wickersham &
Taft LLP.
Kramer Levin Naftalis & Frankel LLP represents the Official
Committee of Unsecured Creditors. Huron Consulting Services LLC
serves as the Committee's financial advisor.
The Debtor has sold off the principal plants. The sale of the
Wheeling Corrugating division to Nucor Corp. brought in $7
million. That plant in Sparrows Point, Maryland, fetched the
highest price, $72.5 million. CJ Betters Enterprises Inc. paid
$16 million for the Ohio plant.
RG STEEL: Wins Court Approval to Settle EPA Claims
--------------------------------------------------
U.S. Bankruptcy Judge Kevin Carey approved an agreement, which
calls for the settlement of claims of the U.S. Environmental
Protection Agency.
Under the deal, the agency can assert a general unsecured claim
against each of RG Steel's affiliates: RG Steel Wheeling LLC, RG
Steel Warren LLC and RG Steel Sparrows Point LLC. Together, the
claims assert more than $19.8 million. A copy of the agreement is
available for free at http://is.gd/9CMObW
The claims stemmed from the steel makers' alleged violation of
U.S. environmental protection laws.
About RG Steel
RG Steel LLC -- http://www.rg-steel.com/-- is the United States'
fourth-largest flat-rolled steel producer with annual steelmaking
capacity of 7.5 million tons. It was formed in March 2011
following the purchase of three steel facilities located in
Sparrows Point, Maryland; Wheeling, West Virginia and Warren,
Ohio, from entities related to Severstal US Holdings LLC. RG
Steel also owns finishing facilities in Yorkville and Martins
Ferry, Ohio. It also owned Wheeling Corrugating Company and has a
50% ownership in Mountain State Carbon and Ohio Coatings Company.
RG Steel along with affiliates, including WP Steel Venture LLC,
sought bankruptcy protection (Bankr. D. Del. Lead Case No. 12-
11661) on May 31, 2012. Bankruptcy was precipitated by liquidity
shortfall and a dispute with Mountain State Carbon, LLC, and a
Severstal affiliate, that restricted the shipment of coke used in
the steel production process.
The Debtors estimated assets and debts in excess of $1 billion.
As of the bankruptcy filing, the Debtors owe (i) $440 million,
including $16.9 million in outstanding letters of credit, to
senior lenders led by Wells Fargo Capital Finance, LLC, as
administrative agent, (ii) $218.7 million to junior lenders, led
by Cerberus Business Finance, LLC, as agent, (iii) $130.5 million
on account of a subordinated promissory note issued by majority
owner The Renco Group, Inc., and (iv) $100 million on a secured
promissory note issued by Severstal.
Judge Kevin J. Carey presides over the case.
The Debtors are represented in the case by Robert J. Dehney, Esq.,
and Erin R. Fay, Esq., at Morris, Nichols, Arsht & Tunnell LLP,
and Matthew A. Feldman, Esq., Shaunna D. Jones, Esq., Weston T.
Eguchi, Esq., at Willkie Farr & Gallagher LLP, represent the
Debtors. Conway MacKenzie, Inc., serves as the Debtors' financial
advisor and The Seaport Group serves as lead investment banker.
Donald MacKenzie of Conway MacKenzie, Inc., as CRO. Kurtzman
Carson Consultants LLC is the claims and notice agent.
Wells Fargo Capital Finance LLC, as Administrative Agent, is
represented by Jonathan N. Helfat, Esq., and Daniel F. Fiorillo,
Esq., at Otterbourg, Steindler, Houston & Rosen, P.C.; and Laura
Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachuiski Stang
Ziehi & Jones LLP.
Renco Group is represented by lawyers at Cadwalader, Wickersham &
Taft LLP.
Kramer Levin Naftalis & Frankel LLP represents the Official
Committee of Unsecured Creditors. Huron Consulting Services LLC
serves as the Committee's financial advisor.
The Debtor has sold off the principal plants. The sale of the
Wheeling Corrugating division to Nucor Corp. brought in $7
million. That plant in Sparrows Point, Maryland, fetched the
highest price, $72.5 million. CJ Betters Enterprises Inc. paid
$16 million for the Ohio plant.
ROCKWELL MEDICAL: Incurs $11.8 Million Net Loss in Q2
-----------------------------------------------------
Rockwell Medical, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
a net loss of $11.86 million on $12.98 million of sales for the
three months ended June 30, 2013, as compared with a net loss of
$11.90 million on $12.12 million of sales for the same period
during the prior year.
For the six months ended June 30, 2013, the Company incurred a net
loss of $27.24 million on $25.32 million of sales, as compared
with a net loss of $22.47 million on $24.15 million of sales for
the same period a year ago.
As of June 30, 2013, the Company had $54.02 million in total
assets, $36.78 million in total liabilities and $17.23 million in
total shareholders' equity.
"During the second quarter and early July we achieved several
major clinical milestones," stated Rob Chioini, Founder, Chairman
and CEO of Rockwell. "Top line data from our Phase 3 CRUISE-1
study was exceptional. SFP met the primary endpoint and key
secondary endpoints, and showed an exceptional safety profile. The
Phase 3 data demonstrated that SFP, in place of IV iron, can
effectively deliver iron and maintain hemoglobin levels in
dialysis patients without increasing their iron stores. Regarding
Calcitriol, we anticipate FDA manufacturing approval to begin
marketing our Vitamin D injection will occur in the near term.
Overall, we are very pleased with our drug development progress
during the quarter."
A copy of the Form 10-Q is available for free at:
http://is.gd/YhPZD6
About Rockwell
Rockwell Medical, Inc. (Nasdaq: RMTI), headquartered in Wixom,
Michigan, is a fully-integrated biopharmaceutical company
targeting end-stage renal disease ("ESRD") and chronic kidney
disease ("CKD") with innovative products and services for the
treatment of iron deficiency, secondary hyperparathyroidism and
hemodialysis (also referred to as "HD" or "dialysis").
Rockwell's lead investigational drug is in late stage clinical
development for iron therapy treatment in CKD-HD patients. It is
called Soluble Ferric Pyrophosphate ("SFP"). SFP delivers iron to
the bone marrow in a non-invasive, physiologic manner to
hemodialysis patients via dialysate during their regular dialysis
treatment.
In its report on the consolidated financial statements for the
year ended Dec. 31, 2012, Plante & Moran, PLLC, in Clinton
Township, Michigan, expressed substantial doubt about Rockwell
Medical's ability to continue as a going concern, citing the
Company's recurring losses from operations, negative working
capital, and insufficient liquidity.
The Company reported a net loss of $54.0 million on $49.8 million
of sales in 2012, compared with a net loss of $21.4 million on
$49.0 million of sales in 2011.
ROTHSTEIN ROSENFELDT: Akerman Atty Tapped as Liquidation Trustee
----------------------------------------------------------------
Carolina Bolado of BankruptcyLaw360 reported that the head of
Florida-based Akerman Senterfitt LLP's bankruptcy and
reorganization practice group has been tapped as the trustee to
oversee the liquidation of convicted Ponzi schemer Scott
Rothstein's law firm, which is nearing the end of a contentious
Chapter 11 proceeding.
The report said Michael I. Goldberg, the chair of Akerman's
reorganization practice group and an expert on Ponzi schemes, has
been appointed the liquidating trustee for the wind-down of
Rothstein Rosenfeldt Adler PA, according to documents filed
earlier this month in the case.
About Rothstein Rosenfeldt
Scott Rothstein, co-founder of law firm Rothstein Rosenfeldt Adler
PA -- http://www.rra-law.com/-- was suspected of running a
$1.2 billion Ponzi scheme. U.S. authorities claimed in a civil
forfeiture lawsuit filed Nov. 9, 2009, that Mr. Rothstein, the
firm's former chief executive officer, sold investments in non-
existent legal settlements. Mr. Rothstein pleaded guilty to five
counts of conspiracy and wire fraud on Jan. 27, 2010.
Creditors of Rothstein Rosenfeldt Adler signed a petition sending
the Florida law firm to bankruptcy (Bankr. S.D. Fla. Case No.
09-34791). The petitioners include Bonnie Barnett, who says she
lost $500,000 in legal settlement investments; Aran Development,
Inc., which said it lost $345,000 in investments; and trade
creditor Universal Legal, identified as a recruitment firm, which
said it is owed $7,800. The creditors alleged being owed money
invested in lawsuit settlements.
Herbert M. Stettin, the state-court appointed receiver for
Rothstein Rosenfeldt, was officially carried over as the
Chapter 11 trustee in the involuntary bankruptcy case.
On June 10, 2010, Mr. Rothstein was sentenced to 50 years in
prison.
The official committee of unsecured creditors appointed in the
case is represented by Michael Goldberg, Esq., at Akerman
Senterfitt.
REFCO INC: Judge Won't Revive Abetting Claims Against PwC
---------------------------------------------------------
Law360 reported that a New York federal judge refused to
reconsider his June ruling in favor of PricewaterhouseCoopers LLP
and others on allegations that they aided the Refco Inc. fraud
with respect to a group of hedge funds.
According to the report, U.S. District Judge Jed S. Rakoff said
Kenneth Krys, the trustee for Sphinx Managed Future Fund SPC,
failed to show that the losses he claims the group sustained as a
result of the Refco fraud were enabled by PwC and co-defendants
Credit Suisse Securities (USA) LLC, Merrill Lynch Pierce, among
others.
The case is In Re: Refco Securities Litigation, Case No. 1:07-md-
01902 (S.D.N.Y.) before Judge Jed S. Rakoff.
About Refco Inc.
Headquartered in New York, Refco Inc. -- http://www.refco.com/--
was a diversified financial services organization with operations
in 14 countries and an extensive global institutional and retail
client base. Refco's worldwide subsidiaries were members of
principal U.S. and international exchanges, and were among the
most active members of futures exchanges in Chicago, New York,
London and Singapore. Refco was also a major broker of cash
market products, including foreign exchange, foreign exchange
options, government securities, domestic and international
equities, emerging market debt, and OTC financial and commodity
products. Refco was one of the largest global clearing firms for
derivatives. The Company had operations in Bermuda.
The Company and 23 of its affiliates filed for Chapter 11
protection on October 17, 2005 (Bankr. S.D.N.Y. Case No.
05-60006). J. Gregory Milmoe, Esq., at Skadden, Arps, Slate,
Meagher & Flom LLP, represented the Debtors in their restructuring
efforts. Milbank, Tweed, Hadley & McCloy LLP, represented the
Official Committee of Unsecured Creditors. Refco reported
US$16.5 billion in assets and US$16.8 billion in debts to the
Bankruptcy Court on the first day of its Chapter 11 cases.
The Court confirmed the Modified Joint Chapter 11 Plan of
Refco Inc. and certain of its Direct and Indirect Subsidiaries,
including Refco Capital Markets, Ltd., and Refco F/X Associates,
LLC, on December 15, 2006. That Plan became effective on Dec. 26,
2006. Pursuant to the plan, RJM, LLC, was named plan
administrator to reorganized Refco, Inc., and its affiliates, and
Marc S. Kirschner as plan administrator to Refco Capital Markets,
Ltd.
RG STEEL: To Settle With EPA For $20MM In Allowed Claims
--------------------------------------------------------
Law360 reported that a Delaware bankruptcy judge gave his stamp of
approval to a settlement between RG Steel LLC and the U.S.
Environmental Protection Agency that will see the regulator have
nearly $20 million in allowed claims stemming from alleged civil
penalties at several of the defunct steelmaker's former
facilities.
According to the report, U.S. Bankruptcy Judge Kevin J. Carey made
little comment as he accepted the settlement stipulations at a
hearing in Wilmington, where an RG Steel attorney said the
agreement received response in support of the agreement.
About RG Steel
RG Steel LLC -- http://www.rg-steel.com/-- is the United States'
fourth-largest flat-rolled steel producer with annual steelmaking
capacity of 7.5 million tons. It was formed in March 2011
following the purchase of three steel facilities located in
Sparrows Point, Maryland; Wheeling, West Virginia and Warren,
Ohio, from entities related to Severstal US Holdings LLC. RG
Steel also owns finishing facilities in Yorkville and Martins
Ferry, Ohio. It also owned Wheeling Corrugating Company and has a
50% ownership in Mountain State Carbon and Ohio Coatings Company.
RG Steel along with affiliates, including WP Steel Venture LLC,
sought bankruptcy protection (Bankr. D. Del. Lead Case No. 12-
11661) on May 31, 2012. Bankruptcy was precipitated by liquidity
shortfall and a dispute with Mountain State Carbon, LLC, and a
Severstal affiliate, that restricted the shipment of coke used in
the steel production process.
The Debtors estimated assets and debts in excess of $1 billion.
As of the bankruptcy filing, the Debtors owe (i) $440 million,
including $16.9 million in outstanding letters of credit, to
senior lenders led by Wells Fargo Capital Finance, LLC, as
administrative agent, (ii) $218.7 million to junior lenders, led
by Cerberus Business Finance, LLC, as agent, (iii) $130.5 million
on account of a subordinated promissory note issued by majority
owner The Renco Group, Inc., and (iv) $100 million on a secured
promissory note issued by Severstal.
Judge Kevin J. Carey presides over the case.
The Debtors are represented in the case by Robert J. Dehney, Esq.,
and Erin R. Fay, Esq., at Morris, Nichols, Arsht & Tunnell LLP,
and Matthew A. Feldman, Esq., Shaunna D. Jones, Esq., Weston T.
Eguchi, Esq., at Willkie Farr & Gallagher LLP, represent the
Debtors. Conway MacKenzie, Inc., serves as the Debtors' financial
advisor and The Seaport Group serves as lead investment banker.
Donald MacKenzie of Conway MacKenzie, Inc., as CRO. Kurtzman
Carson Consultants LLC is the claims and notice agent.
Wells Fargo Capital Finance LLC, as Administrative Agent, is
represented by Jonathan N. Helfat, Esq., and Daniel F. Fiorillo,
Esq., at Otterbourg, Steindler, Houston & Rosen, P.C.; and Laura
Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachuiski Stang
Ziehi & Jones LLP.
Renco Group is represented by lawyers at Cadwalader, Wickersham &
Taft LLP.
Kramer Levin Naftalis & Frankel LLP represents the Official
Committee of Unsecured Creditors. Huron Consulting Services LLC
serves as the Committee's financial advisor.
The Debtor has sold off the principal plants. The sale of the
Wheeling Corrugating division to Nucor Corp. brought in $7
million. That plant in Sparrows Point, Maryland, fetched the
highest price, $72.5 million. CJ Betters Enterprises Inc. paid
$16 million for the Ohio plant.
RURAL/METRO CORP: Wins Approval of "First Day" Motions
------------------------------------------------------
Rural/Metro Corporation on Aug. 6 disclosed that the U.S.
Bankruptcy Court for the District of Delaware has approved the
Company's "first day" motions.
The Court's approval of these motions, including granting interim
approval for Rural/Metro to use $40 million of its $75 million
Debtor-in Possession ("DIP") financing, will allow Rural/Metro to
support its employees, customers, patients and communities and
continue normal operations throughout the financial restructuring
process. The Company is authorized to pay for all going-forward
goods and services.
Separately, as previously announced, Rural/Metro's bondholders
have committed to invest an additional $135 million of new equity
in the Company, which will position the Company for renewed
growth.
Additional information, including the terms of Rural/Metro's DIP
agreement as well as Court filings and other documents concerning
the restructuring process, is available on a dedicated website
administered by Rural/Metro's claims agent, Donlin, Recano &
Company, Inc., at http://www.donlinrecano.com/rmc
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 Healthcare
Industry Group, LLC and FTI Consulting, Inc. are serving as
financial advisors to Rural/Metro.
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.
RURAL/METRO CORP: List of 50 Largest Unsecured Creditors
--------------------------------------------------------
Entity Nature of Claim Amount of Claim
------ --------------- ---------------
Wells Fargo Bank, N.A., Notes $308,000,000
indenture trustee for the
10.125% Senior Notes due 2019
Issued under (i) that Indenture
dated as of June 30, 2011 among
WP Rocket Merger Sub Inc.,
Rural/Metro Corporation, the
guarantors party thereto and
Wells Fargo Bank, N.A., as
Trustee, and (ii) that Indenture
dated as of February 3,
2012 among Rural/Metro
Corporation, the guarantors party
thereto and Wells Fargo Bank,
N.A., as Trustee
45 Broadway, 14th Floor
New York, NY 10006
Attn: Corporate Trust Services -
Administrator for Rural/Metro
Corporation
Fax: (212) 515-1589
- and -
Curtis L. Tuggle
Thompson Hine LLP
3900 Key Center
127 Public Square
Cleveland, OH 44114
Tel: (216) 566-5904
Fax: (216) 566-5800
Email:
Curtis.tuggle@thompsonhine.com
Henry Schein Trade $1,051,131
135 Duryea Road
Melville, NY 11747
Ryan Clark
Tel: (800) 718-3002
Fax: (866) 260-5004
Email: ryan.clark@henryschein.com
PricewaterhouseCoopers LLP Trade $513,620
1850 N. Central Avenue
Suite 700
Phoenix, AZ 85004
Richard Kalenka
Tel: (602) 364-8374
Fax: (602)365-8001
Email: Richard.f.kalenka@us.pwc.com
DLA Piper LLP Trade $498,504
2415 E. Camelback Road
Phoenix, AZ 85016
Greg Hall
Tel: (480) 606-5128
Fax: (480) 606-5101
Email: greg.hall@dlapiper.com
Braun Industries Inc. Trade $459,087
1170 Production Drive
Van Wert, OH 45891
Chad Brown
Tel: (419) 232-7054
Fax: (419) 232-7072
Email: chadb@braunambulances.com
Baker & Hostetler LLP Trade $446,377
1900 E. 9th Street
Suite 3200
Cleveland, OH 44114
Todd Dawson
Tel: (216) 621-0200
Fax: (216) 696-0740
Email: tdawson@bakerlaw.com
Squire Sanders & Dempsey LLP Trade $425,259
1 E. Washington Street
Suite 2700
Phoenix, AZ 85004
Joe Crabb
Tel: (602) 528-4000
Fax: (602) 253-8129
Email: jcrabb@ssd.com
Business & Decision North Trade $365,698
America
8414 N. 90th Street
Suite 101
Scottsdale, AZ 85258
Kevin Bulkovatz
Tel: (602) 244-1200
Fax: (480) 452-1165
Email:
Kevin.bolkovatz@businessdecision.com
Zoll Data Systems Trade $337,367
11802 Ridge Parkway
Suite 400
Broomfield, CO 80021
Kevin Tapply
Tel: (970) 396-7782
Fax: (303) 225-6022
Email: ktapply@zoll.com
Cleary Gottlieb Steen & Trade $309,675
Hamilton LLP
One Liberty Plaza
New York, NY 10006
Meme Peponis
Tel: (212) 225-2000
Fax: (212) 225-3999
Email: mpeponis@cgsh.com
Wheeled Coach Trade $284,786
Industries Inc.
2737 Forsyth Road
Winter Park, FL 32792
Paul Holzapfel
Tel: (800) 342-0720
Fax: (407) 679-1337
Email:
paul.holzapfel@wheeledcoach.com
Adin Bradley Severance $277,499
[REDACTED]
Snell & Wilmer LLP Trade $273,863
One Arizona Center
400 East Van Buren Street #1900
Phoenix, AZ 85004
Barb Dawson
Tel: (602) 382-6000
Fax: (602) 382-6070
Email: bdawson@swlaw.com
CDW Direct LLC Trade $248,604
c/o Andrew Quirke
Email: andrqui@cdw.com
Collection Service Bureau Trade $243,325
c/o Chris Becraft
Email: chris@csbcollections.com
Wist Office Products Trade $240,172
c/o Bill Strait
Email: bstrait@wist.com
AON Risk Insurance Services Trade $235,035
West Inc.
Andrew Lennox
Email: Andrew.lennox@aon.com
Robert Zachrich Severance $223,076
First Watch Trade $214,000
c/o Marc Baker
Email: mbaker@firstwatch.com
Jorge Perez Severance $188,461
Physio-Control f/k/a Trade $185,683
Medtronic Emergency
Kevin Veenstra
Email:
Kevin.m.veenstra@physio-control.com
David Lindberg Severance $167,335
Merchants Credit Association Trade $146,525
John Painter
Email: jpainter@merchantscredit.com
Standard Auto Parts Company Trade $132,447
Randy Skomsvold Severance $126,153
Navigant Consulting Inc. Trade $121,398
David Benkert
Email: dbenkert@navigant.com
Revenue Recovery Corp. Inc. Trade $120,274
Gregg Swersky
Email: gswe@rrcinc.com
Lewis & Roca LLP Trade $111,553
Steve Hart
Email: shart@lrlaw.com
Earnhardt Ford Sales Inc. Trade $96,377
Karen Hecker
Email: Karen.hecker@earnhardt.com
Diesel System Solutions Inc. Trade $92,697
Protiviti Trade $91,320
Email: phoenix@protiviti.com
Gallagher Bassett Trade $90,688
Services Inc.
Suzanne Spencer
Email: Suzanne_spence@gbtpa.com
Napa Auto Parts Trade $89,501
Jim Hunter
Email: james_hunter@genpt.com
ADP Inc. Trade $73,377
Theresa Stafford
Email: Theresa.stafford@adp.com
Commercial Cleaning Systems Trade $68,933
Titus Gardner
Email:
info@commercialcleaningsystems.net
Berge Ford Trade $64,636
Moody's Investors Service Trade $62,000
Jonathan Lareau
Email: jonatahn.lareau@moodyscom
Emergency Radio Service Inc. Trade $60,955
Tracy Carbaugh
Email: tracy@ersire.com
Bradshaw Consulting Services Trade $57,900
Elizabeth Bradshaw
Email: etb@bcs-gis.com
Cascade Fire Equipment Co. Trade $57,539
Email: sales@cascadefire.com
Law Office of Trade $56,082
Robert E. Melton
Joe Basil Chevrolet Inc. Trade $55,761
Craig Colby
Email: craigc@joebasilchevrolet.com
Kearny Pearson Ford Trade $51,519
Gary Frank
Chapman Ford Trade $47,481
Rick Webb
Email:
richardwebb@chapmanchoice.com
O'Meara Ford Trade $46,806
Starwest Associates LLC Trade $46,480
Bob Ramsey
Email: bramsey@starwest.us
Holmes Tuttle Ford Inc. Trade $46,263
Zoll Medical Corp. GPO Trade $45,663
Bound Tree Medical LLC Trade $44,741
Harry Larson
Email: hlarson@boundtree.com
Insight Direct USA Trade $43,784
RURAL/METRO CORP: Moody's Cuts CFR to Ca After Bankruptcy Filing
----------------------------------------------------------------
Moody's Investors Service downgraded Rural/Metro Corporation's
probability of default rating to D-PD from Caa2-PD, corporate
family rating to Ca from Caa2, senior secured credit facilities to
Caa2 from B3, and unsecured notes to C from Caa3. The ratings were
downgraded following the company's announcement on August 4, 2013
that it filed Chapter 11 petitions in the United States Bankruptcy
Court for the District of Delaware.
Subsequent to these actions, Moody's will withdraw the ratings of
Rural/Metro because of its bankruptcy filing.
The following rating actions were taken:
Probability of default rating, downgraded to D-PD from Caa2-PD;
Corporate family rating, downgraded to Ca from Caa2;
$110 million revolving credit facility, due 2016, downgraded to
Caa2 (LGD2, 25%) from B3 (LGD2, 25%);
$325 million term loan, due 2018, downgraded to Caa2 (LGD2,
25%) from B3 (LGD2, 25%);
$200 million unsecured notes, due 2019, downgraded to C (LGD5,
80%) from Caa3 (LGD5, 80%);
$108 million unsecured notes, due 2019, downgraded to C (LGD5,
80%) from Caa3 (LGD5, 80%);
Outlook remains negative.
Ratings Rationale:
The downgrade of the CFR and PDR reflect the company's bankruptcy
filing.
Rural/Metro provides emergency and non-emergency medical
transportation, fire protection, airport fire rescue, and home
healthcare services in 21 states and approximately 700 communities
within the United States. The services are provided under contract
with government entities, hospitals, healthcare facilities and
other healthcare organizations. Net revenue for the twelve months
ended March 31, 2013 was approximately $664 million. Rural/Metro
was bought by Warburg Pincus in 2011.
The principal methodology used in this rating was the Global
Business & Consumer Service Industry Rating Methodology published
in October 2010. Other methodologies used include Loss Given
Default for Speculative-Grade Non-Financial Companies in the U.S.,
Canada and EMEA published in June 2009.
REVSTONE INDUSTRIES: US Trustee Slams Metavation's Quick Sale Plan
------------------------------------------------------------------
Law360 reported that the U.S. Trustee's Office blasted the
strategy by Revstone Industries LLC's bankrupt affiliate
Metavation LLC to turnaround a quick $25 million stalking horse
sale, arguing the timetable leaves no room for anyone else, even
potential bidders, to participate in the process.
According to the report, in an objection filed in Delaware
bankruptcy court, U.S. Trustee Roberta A. DeAngelis contended that
the calendar Metavation is envisioning to have a sale approved by
the court -- 16 days after a judge approves bidding procedures --
is much too short.
About Revstone Industries, Greenwood Forgings,
& US Tool & Engineering
Lexington, Kentucky-based Revstone Industries LLC, a maker of
truck parts, filed for Chapter 11 bankruptcy (Bankr. D. Del. Case
No. 12-13262) on Dec. 3, 2012. Judge Brendan Linehan Shannon
oversees the case. In its petition, Revstone estimated under
$50 million in assets and debts.
Affiliate Spara LLC filed its Chapter 11 petition (Bankr. D. Del.
Case No. 12-13263) on Dec. 3, 2012.
Lexington-based Greenwood Forgings, LLC (Bankr. D. Del. Case No.
13-10027) and US Tool & Engineering LLC (Bankr. D. Del. Case No.
13-10028) filed separate Chapter 11 petitions on Jan. 7, 2013.
Judge Shannon also oversees the cases.
A motion for joint administration of the cases has been filed.
Duane David Werb, Esq., at Werb & Sullivan, serves as bankruptcy
counsel to Greenwood and US Tool. Greenwood estimated $1 million
to $10 million in assets and $10 million to $50 million in debts.
US Tool & Engineering estimated under $1 million in assets and
$1 million to $10 million in debts. The petitions were signed by
George S. Homeister, chairman.
Metavation, also known as Hillsdale Automotive, LLC, joined parent
Revstone in Chapter 11 on July 22, 2013 (Bankr. D. Del. Case No.
13-11831) to sell the bulk of its assets to industry rival Dayco
for $25 million, absent higher and better offers.
SAN BERNARDINO, CA: To Get Nevada Judge as Mediator
---------------------------------------------------
Steven Church, writing for Bloomberg News, reported that the judge
in San Bernardino, California's bankruptcy said she will appoint a
judge who oversaw a $6.5 billion casino reorganization to mediate
talks between the city and its creditors.
According to the report, U.S. Bankruptcy Judge Meredith Jury said
she will issue an order in September explaining what issues the
mediator, Gregg Zive, will help tackle. Zive, who is based in
Reno, Nevada, presided over the case of Station Casinos Inc.,
which cut debt, reorganized and left bankruptcy in 2011.
Jury asked the city and creditors, which include investors that
hold more than $50 million in pension-obligation bonds and the
California Public Employees' Retirement System, to submit matters
they want Zive to address, including a plan to cut debt and a
dispute with the state over tax collections, the report said.
Jury will take their views into consideration when she issues her
order.
"He seems to be a very good choice," Jury said after attorneys for
the city and some creditors told her they agreed on the selection
of Zive, a judge in the U.S. Bankruptcy Court in Nevada, the
report related.
Since filing for bankruptcy last year, San Bernardino has fought
to cancel city employee union contracts and to quit making some
payments to Calpers, the biggest U.S. pension fund, the report
noted.
About San Bernardino, Calif.
San Bernardino, California, filed an emergency petition for
municipal bankruptcy under Chapter 9 of the U.S. Bankruptcy Code
(Bankr. C.D. Cal. Case No. 12-28006) on Aug. 1, 2012. San
Bernardino, a city of about 210,000 residents roughly 65 miles
(104 km) east of Los Angeles, estimated assets and debts of more
than $1 billion in the bare-bones bankruptcy petition.
The city council voted on July 10, 2012, to file for bankruptcy.
The move lets San Bernardino bypass state-required mediation with
creditors and proceed directly to U.S. Bankruptcy Court.
The city is represented that Paul R. Glassman, Esq., at Stradling
Yocca Carlson & Rauth.
San Bernardino joined two other California cities in bankruptcy:
Stockton, an agricultural center of 292,000 east of San Francisco,
and Mammoth Lakes, a mountain resort town of 8,200 south of
Yosemite National Park.
SAN DIEGO HOSPICE: Hires Foley & Lardner as Special Counsel
-----------------------------------------------------------
San Diego Hospice & Palliative Care Corporation asks the U.S.
Bankruptcy Court for permission to employ Foley & Lardner LLP as
special Medicare counsel.
Judith A. Waltz, Esq., attests that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the
Bankruptcy Code.
San Diego Hospice & Palliative Care Corporation filed a Chapter 11
petition (Bankr. S.D. Cal. Case No. 13-01179) in San Diego on
Feb. 4, 2013. The Debtor is the operator of the San Diego Hospice
and The Institute for Palliative Medicine, one of the largest
community-owned, not-for-profit hospices in the country.
The Debtor scheduled $20,369,007 in total assets and $14,888,058
in total liabilities.
Even before the bankruptcy filing, the Debtor has been under a
federal investigation, focusing whether it allowed patients to
stay in the program even when their diagnosis changed. The Debtor
said that it will meet with government agencies to address their
concerns, explore partnerships with other health care
organizations, and work to restructure and resize San Diego
Hospice. The Debtor said it has encouraged Scripps Health, the
region's largest provider of health care services, to enter the
hospice business.
Procopio, Cory, Hargreaves & Savitch LLP serves as counsel to the
Debtor.
On April 30, 2013, San Diego Hospice received Court authority to
sell its unused 24-bed hospice facility to Scripps Health for
$16.55 million. Scripps made the opening bid of $10.7 million at
the auction that took place before the sale-approval hearing. The
other bidder was Sharp Healthcare. The sale is also subject to
approval by regulators in California.
In May 2013, San Diego Hospice and its creditors' committee
jointly filed a liquidating Chapter 11 plan and an explanatory
disclosure statement.
SBMC HEALTHCARE: Marty McVey Files Expedited Motion to Convert
--------------------------------------------------------------
Creditor Marty McVey filed with the U.S. Bankruptcy Court for the
Southern District of Texas on July 18, 2013, an expedited motion
(1) to convert SBMC Healtcare, LLC's Chapter 11 case to one under
Chapter 7 of the Bankruptcy, (2) to delay ruling on pending fee
applications, and (3) for an order required the Liquidating
Trustee to account for all post-confirmation financial
transactions.
On April 4, 2013, the U.S. Bankruptcy Court for the Southern
District of Texas confirmed the Joint Amended Plan of Liquidation
of the Official Committee of Unsecured Creditors and the Debtor
dated March 25 2013. The Effective Date of the Joint Plan
occurred on April 10, 2013.
According to Mr. McVey, the Court should set a preliminary hearing
on his Motion and order the Liquidating Trustee to account fully
for the financial activities of the Liquidating Trust from and
after the occurrence of Plan confirmation, including the
production of all bank account information.
A copy of the motion is available at:
http://bankrupt.com/misc/SBMChealthcare.doc1202
Counsel for Mr. McVey can be reached at:
Leonard H. Simon, Esq.
PENDERGRAFT & SIMON, LLP
The Riviana Building
2777 Allen Parkway, Suite 800
Houston, TX 77019
Tel: (713) 528-8555
Fax: (832) 202-2810
E-mail: lsimon@pendergraftsimon.com
About SBMC Healthcare
Houston, Texas-based SBMC Healthcare, LLC, is 100% owned by McVey
& Co. Investments LLC. It filed a Chapter 11 petition (Bankr.
S.D. Tex. Case No. 12-33299) on April 30, 2012. The petition was
signed by the president of McVey & Co. Investments LLC, sole
manager. The Debtor disclosed $40,149,593 in assets and
$13,108,268 in liabilities as of the Chapter 11 filing. Marilee
A. Madan, P.C. in Houston, Texas, is the Debtor's general
bankruptcy counsel. Millard A. Johnson, Esq., and Sara Mya Keith,
Esq., at Johnson DeLuca, Kurisky & Gould, P.C., in Houston, serve
as the Debtor's special bankruptcy counsel. Judge Jeff Bohm
presides over the case.
The Official Committee of Unsecured Creditors is represented by
Hall Attorneys, P.C.
SCICOM DATA: Files Voluntary Chapter 11 Bankruptcy Petition
-----------------------------------------------------------
Venture Solutions Inc. on Aug. 6 disclosed that it has entered
into an agreement to acquire the assets of SCICOM Data Services of
Minnetonka, MN. Under terms of the agreement, SCICOM would be
combined with Venture Solutions, a Taylor Corporation subsidiary
based in Arden Hills, MN, with the company continuing to carry the
name Venture Solutions Inc.
Venture Solutions is a provider of print and digital transactional
communications, serving Fortune 1000 companies in compliance-
driven markets, including financial services, insurance,
healthcare and telecommunications. Venture continues to enhance
its products and services to meet the changing needs of its
clients, including full-color variable digital printing, mail and
e-channel deployment options. Venture also provides the postal
and regulatory knowledge to optimize the execution of clients'
customer communication programs. Venture's parent organization,
Taylor Corporation, is one of the top 10 personalized graphic
communications providers in North America. Taylor has over 80
affiliated companies across North America, Asia and Europe.
"As Venture and Taylor continue to evolve to meet the changing
needs of their clients, the addition of SCICOM capabilities and
expertise aligns very well with our growth strategy centered on
personalized customer communications," said Glen Taylor, Taylor
Corporation CEO. "We will build upon both Venture's and SCICOM's
legacies of market leadership and market knowledge in compliance-
driven industries to continue our growth."
SCICOM is a rovider of data processing solutions that transform
critical data into effective customer communications, on any
platform, at any time. SCICOM's business focus has been employee
benefits, retirement and investment services, and statement
processing.
To facilitate the sale of assets, SCICOM has initiated a
prepackaged voluntary Chapter 11 proceeding in United States
Bankruptcy Court for the State of Minnesota. SCICOM has filed a
number of motions with the Court requesting authority to keep the
business operating as usual. If the Purchase Agreement with
Venture is approved by the Bankruptcy Court, SCICOM will work with
Venture to address the structure of the combined organization,
with the primary objective of providing its clients best-in-class
products, services and technologies.
"As we searched for a suitable buyer, Venture and Taylor stood out
as sharing the same values and culture that we are proud of at
SCICOM," said SCICOM CEO Dick Walter. "I believe these shared
qualities position the combined companies very well for continued
success."
The combined capabilities of Venture and SCICOM will significantly
expand Venture's capacity to meet the future needs of its current
clients, as well as new business opportunities. For more
information on both Venture Solutions and Taylor Corporation, go
to http://www.venturesolutions.comand http://www.taylorcorp.com
About Venture Solutions
Headquartered in Minneapolis-St. Paul, Minnesota, with a facility
in Dallas-Fort Worth, TX, Venture Solutions is a provider of print
and digital transactional communications, serving Fortune 1000
companies in compliance-driven markets, including financial
services, insurance, healthcare and telecommunications. Venture's
client-focused VentureAccessSM online 24/7 portal provides market-
leading management tools.
About Taylor Corporation
Taylor Corporation is one of the largest privately held companies
in the United States, with more than 80 subsidiaries and 9,000
employees. Taylor provides the interactive, printing and
marketing solutions that help build the world's most popular
brands. Its products are embraced by everyone from brides to big
box retailers and from small businesses to Fortune 500 companies.
About SCICOM
Headquartered in Minnetonka, Minnesota, SCICOM is a provider of
data processing solutions that transform critical data into
effective customer communications, on any platform, at any time.
SCICOM's business focus has been employee benefits, retirement and
investment services, and statement processing.
SCOOTER STORE: Gets Nod to Continue Ch. 11 Under Own Power
----------------------------------------------------------
Jamie Santo of BankruptcyLaw360 reported that a Delaware
bankruptcy judge gave Scooter Store Holdings Inc. the green light
to tap its cash collateral, allowing the private equity-controlled
scooter seller to proceed with its new plan to pay its own way in
Chapter 11 while it seeks a suitor.
According to the report, the Scooter Store entered court
protection after lining up a $10 million debtor-in-possession
package, but determined that it can save money and buy additional
time to land a purchaser by funding the case itself.
About The Scooter Store
The Scooter Store is a supplier of power mobility solutions,
including power wheelchairs, scooters, lifts, ramps, and
accessories. The Scooter Store's products and services provide
today's seniors and disabled persons potential alternatives to
living in nursing homes or other care facilities. Headquartered
in New Braunfels, Texas, the Scooter Store has a nationwide
network of distribution centers that service products owned or
leased by the Company's customers. It has 57 distribution
centers in 41 states.
Scooter Store Holdings Inc., and 71 affiliates filed for Chapter
11 bankruptcy (Bankr. D. Del. Lead Case No. 13-10904) in
Wilmington. The closely held company listed assets of less than
$10 million and debt of more than $50 million.
Affiliates of private equity firm Sun Capital Partners, based in
Boca Raton, Florida, purchased a majority voting interest in the
debtors in 2011. Scooter Store is 66.8 percent owned by Sun
Capital Partners Inc., owed $40 million on a third lien. In
addition to Sun's debt and $25 million on a second lien owing to
Crystal Financial LLC, there is a $25 million first-lien revolving
credit owing to CIT Healthcare LLC as agent. Crystal is providing
$10 million in financing for bankruptcy.
SEANERGY MARITIME: Annual Shareholders' Meeting on Sept. 5
----------------------------------------------------------
The annual meeting of the holders of shares of common stock of
Seanergy Maritime Holdings Corp. will be held on Sept. 5, 2013, at
6:00 p.m. local time, at the Company's executive offices at 1-3
Patriarchou Grigoriou, 16674 Glyfada, Athens, Greece, for these
purposes:
1. To elect two Class A Directors to serve until the 2016 Annual
Meeting of Shareholders;
2. To approve the appointment of Ernst & Young (Hellas) Certified
Auditors Accountants S.A. to serve as the Company's independent
auditors for the fiscal year ending Dec. 31, 2013;
3. To transact other business as may properly come before the
Meeting or any adjournment thereof.
About Seanergy
Athens, Greece-based Seanergy Maritime Holdings Corp. is an
international company providing worldwide seaborne transportation
of dry bulk commodities. The Company owns and operates a fleet of
seven dry bulk vessels that consists of three Handysize, two
Supramax and two Panamax vessels. Its fleet carries a variety of
dry bulk commodities, including coal, iron ore, and grains, as
well as bauxite, phosphate, fertilizer and steel products.
In its audit report on the consolidated financial statements for
the year ended Dec. 31, 2012, Ernst & Young (Hellas) Certified
Auditors Accountants S.A., in Athens, Greece, expressed
substantial doubt about Seanergy Maritime's ability to continue as
a going concern. The independent auditors noted that the Company
has not complied with the principal and interest repayment
schedule and with certain covenants of its loan agreements, which
in turn gives the lenders the right to call the debt. "In
addition, the Company has a working capital deficit, recurring
losses from operations, accumulated deficit and inability to
generate sufficient cash flow to meet its obligations and sustain
its operations."
The Company reported a net loss of $193.8 million on $55.6 million
of net vessel revenue in 2012, compared with a net loss of
$197.8 million on $104.1 million of net vessel revenue in 2011.
As of March 31, 2013, the Company had $93.01 million in total
assets, $193.56 million in total liabilities and a $100.54 million
total deficit.
SHOTWELL LANDFILL: Hires Ball & Minor as Accountants
----------------------------------------------------
Shotwell Landfill, Inc., asks the U.S. Bankruptcy Court for
permission to employ David W. Ball, CPA, and the firm of Ball &
Minor, CPA, PA as their Certified Public Accountants.
The firm, among other things, will provide these services:
a. assist the Debtor in preparing their federal and state
corporate income tax returns;
b. business consulting; and
c. perform any other mutually agreed upon accounting services
needed by the Debtor as part of the bankruptcy proceedings.
Mr. Ball charges $180 per hour.
The Firm is owed $1,325 by the Debtor for work performed
prepetition.
The Firm agreed to waive their pre-petition claim to be employed
in this bankruptcy case.
The Debtor attests that the Firm 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.
SIERRA NEGRA: Aug. 21 Hearing on Motion to Dismiss Case
-------------------------------------------------------
The U.S. Bankruptcy Court for the District of Nevada will convene
a hearing on Aug. 21, 2013, at 2 p.m., to consider creditor Global
Water Resources, Inc.'s motion to dismiss the Chapter 11 case of
Sierra Negra Ranch LLC.
Las Vegas, Nevada-based Sierra Negra Ranch, LLC, is a limited
liability company organized in November 2004 to purchase an
aggregate of approximately 2,757.5 acres of undeveloped land in
the Tonopah area of incorporated Maricopa County, west of Phoenix,
Arizona. It filed a bare-bones Chapter 11 petition (Bankr. D.
Nev. Case No. 12-19649) in Las Vegas on Aug. 21, 2012. Candace C.
Clark, Esq., and Gerald M. Gordon, Esq., at Gordon Silver, in Las
Vegas, Nev., represent the Debtor as counsel.
In its amended schedules, the Debtor disclosed $26,197,986 in
total assets and $4,801,931 in total liabilities. The Debtor is
"Single Asset Real Estate" as defined in 11 U.S.C. Sec 101(51B)
and its asset is located in Maricopa County, Arizona.
SIERRA NEGRA: Aug. 21 Hearing on Adequacy of Plan Outline
---------------------------------------------------------
The U.S. Bankruptcy Court for the District of Nevada continued
until Aug. 21, 2013, at 2 p.m., the hearing to consider adequacy
of the Disclosure Statement explaining Sierra Negra Ranch LLC's
Plan of Reorganization.
According to the Debtor's case docket, the confirmation hearing is
scheduled for Oct. 22 and Oct. 24.
As reported in the Troubled Company Reporter on May 10, 2013, the
Court denied approval of the First Amended Disclosure Statement.
The Court also ordered the Debtor to file a further amended Plan
and a further amended Disclosure Statement that reflects the "ride
through" treatment of the Infrastructure Agreement (with Global
Water Resources, Inc.) in the alternative.
The Second Amended Plan
According to the Second Amended Disclosure Statement, the Plan
contemplates full payment of all Allowed Claims, including the
Global Secured Claim, over a period of time from the revenue
generated by the farming leases on the real property combined with
a potential sale of a portion of the real property, along with
capital raised through the offering. The Debtor initiated a
Shareholders' Rights Offering of $5,807,500 of Series A Preferred
Shares of Limited-Liability Company Interest.
To satisfy the monetary obligations due under the Plan together
with operational and working capital needs of the Reorganized
Debtor, Reorganized Debtor will use sale proceeds, proceeds from
leases of the real property and the proceeds of the offering.
The Reorganized Debtor will conclude the offering not later than
Dec. 31, 2013, for the purpose of funding the Distributions
contemplated to the creditors and operational and
working capital needs of the Reorganized Debtor.
A copy of the Second Amended Disclosure Statement is available for
free at http://bankrupt.com/misc/SIERRA_NEGRA_2ds.pdf
About Sierra Negra Ranch
Las Vegas, Nevada-based Sierra Negra Ranch, LLC, is a limited
liability company organized in November 2004 to purchase an
aggregate of approximately 2,757.5 acres of undeveloped land in
the Tonopah area of incorporated Maricopa County, west of Phoenix,
Arizona. It filed a bare-bones Chapter 11 petition (Bankr. D.
Nev. Case No. 12-19649) in Las Vegas on Aug. 21, 2012. Candace C.
Clark, Esq., and Gerald M. Gordon, Esq., at Gordon Silver, in Las
Vegas, Nev., represent the Debtor as counsel.
In its amended schedules, the Debtor disclosed $26,197,986 in
total assets and $4,801,931 in total liabilities. The Debtor is
"Single Asset Real Estate" as defined in 11 U.S.C. Sec 101(51B)
and its asset is located in Maricopa County, Arizona.
SINCLAIR BROADCAST: Has $985 Million Deal with Allbritton
---------------------------------------------------------
Sinclair Broadcast Group, Inc., has entered into a definitive
agreement to purchase the stock of Perpetual Corporation and the
equity interest of Charleston Television, LLC, both owned and
controlled by the Allbritton family, for an aggregate purchase
price of $985 million. The Allbritton stations consist of seven
ABC Network affiliates, covering 4.9 percent of the U.S. TV
households, and NewsChannel 8, a 24-hour cable/satellite news
network covering the Washington D.C. metropolitan area.
Completion of the transaction is subject to the satisfaction of
customary closing conditions, including approval by the Federal
Communications Commission and antitrust clearance, as applicable.
The Company anticipates that the transaction will close and fund
in the fourth quarter of 2013, subject to the satisfaction of the
closing conditions. The Company expects to fund the purchase
price at closing through a bank loan or by accessing the capital
markets.
To comply with FCC local television ownership rules, Sinclair
expects to sell the license and certain related assets of its
existing stations in Birmingham, AL - WABM (MNT) and WTTO (CW),
Harrisburg/Lancaster/Lebanon/York, PA - WHP (CBS), and Charleston,
SC - WMMP (MNT) and to provide sales and other non-programming
support services to each of these stations pursuant to customary
shared services and joint sales agreements.
In addition, the Company will acquire Allbritton's NewsChannel 8,
the region's only 24-hour local cable/satellite news network
dedicated to covering news, weather, sports and local information
to over 2 million households in the Washington D.C. metropolitan
area.
"We are thrilled to add the Allbritton properties to our growing
portfolio and national footprint," commented David Smith,
president and CEO of Sinclair. "To buy a full-blown news
operation in our nation's capital and an infrastructure that
allows us to be connected to our branches of government and be at
the pulse of national issues is a once-in-a lifetime event. We
are especially excited to acquire the NewsChannel 8 local news
channel, not only for the content it can provide our existing news
stations, but moreover because their regional cable presence
provides the perfect platform should we decide to expand it into
other markets, especially given the amount of local news we
produce across our entire portfolio."
Including the Allbritton station acquisitions, all previously
announced acquisitions, and pro forma for expected synergies, the
Company's 2011 and 2012 net broadcast revenues would have been
$1.609 billion and $1.865 billion, respectively. The $985 million
purchase price represents an 8.7x multiple of the average 2011-
2012 cash flow including $21.5 million of operating synergies,
which excludes any synergies associated with rolling out a
national news cable channel. At an 8.5x enterprise to cash flow
multiple, the additional synergies create approximately $1.83 of
added equity value.
A copy of the press release is available for free at:
http://is.gd/JIhDF1
About Sinclair Broadcast
Based in Baltimore, Maryland, Sinclair Broadcast Group, Inc.
(Nasdaq: SBGI) -- http://www.sbgi.net/-- one of the largest and
most diversified television broadcasting companies, currently owns
and operates, programs or provides sales services to 58 television
stations in 35 markets. The Company's television group reaches
roughly 22% of U.S. television households and includes FOX,
ABC, CBS, NBC, MNT, and CW affiliates.
"Any insolvency or bankruptcy proceeding relating to Cunningham,
one of our LMA partners, would cause a default and potential
acceleration under the Bank Credit Agreement and could,
potentially, result in Cunningham's rejection of our seven LMAs
with Cunningham, which would negatively affect our financial
condition and results of operations," the Company said in its
annual report for the period ended Dec. 31, 2012.
The Company's balance sheet at March 31, 2013, showed $2.73
billion in total assets, $2.83 billion in total liabilities and a
$97.28 million total deficit.
* * *
As reported by the TCR on Feb. 24, 2011, Standard & Poor's Ratings
Services raised its corporate credit rating on Sinclair to 'BB-'
from 'B+'. The rating outlook is stable. "The 'BB-' rating on
Sinclair reflects S&P's expectation that the company could keep
its lease-adjusted debt to EBITDA below historical levels
throughout the election cycle, absent a reversal of economic
growth, meaningful debt-financed acquisitions, or significant
shareholder-favoring measures," explained Standard & Poor's credit
analyst Deborah Kinzer.
In September 2010, Moody's raised its ratings for Sinclair
Broadcast and subsidiary Sinclair Television Group, including the
Corporate Family Rating and Probability-of-Default Rating, each to
Ba3 from B1, and the ratings for individual debt instruments.
Moody's also assigned a B2 (LGD 5, 87%) rating to the proposed
$250 million issuance of Senior Unsecured Notes due 2018 by STG.
The Speculative Grade Liquidity Rating remains unchanged at SGL-2.
The rating outlook is now stable.
SOMERSET INC: Court Denies Sanctions Against State Insurance Fund
-----------------------------------------------------------------
Bankruptcy Judge Jim D. Pappas denied Somerset, Inc.'s motion for
an award of monetary sanctions for an alleged violation of the
automatic stay by Idaho's State Insurance Fund (SIF).
Somerset Inc. is an Idaho employer operating several Jiffy Lube
franchises. It obtained workers' compensation insurance from SIF.
The company filed for a chapter 11 bankruptcy petition on Feb. 7,
2013 (Bankr. Idaho, Case No. 13-00203).
SIF provides workers' compensation insurance for Idaho employers.
Judge Pappas held that although SIF violated the automatic stay in
effect in the Debtor's bankruptcy case when it cancelled the
Policy, the Debtor has not shown by clear and convincing evidence
that SIF had actual knowledge of the existence of the automatic
stay when it did so. Moreover, SIF took prompt steps to
retroactively reinstate the Policy without any lapse in coverage,
the judge added. Under these facts, Judge Pappas denied the
Debtor's request for monetary sanctions against SIF.
A copy of Judge Pappas' July 19, 2013 Memorandum of Decision is
available at http://is.gd/Q5BNqXfrom Leagle.com.
Randal J. French, Esq., of Bauer & French, in Boise, Idaho, serves
as attorney for Somerset, Inc.
George M. Parham, Esq., and Jed W. Manwaring, Esq., of Evans,
Keane, LLP, in Boise, Idaho, serve as attorneys for the State
Insurance Fund.
SONDE RESOURCES: Incurs C$4.9-Mil. Net Loss in Second Quarter
-------------------------------------------------------------
Sonde Resources Corp. reported a net loss of C$4.9 million on
C$6.2 million of revenue for the three months ended June 30, 2013,
compared with a net loss of C$28.0 million on C$6.2 million of
revenue for the same period last year.
The Company reported a net loss of C$10.3 million on
C$13.0 million of revenue for the six months ended June 30, 2013,
compared with net income of C$27.4 million on C$13.5 million of
revenue for the corresponding period of 2012.
The Company recorded an impairment of C$21.0 million to the Joint
Oil Block during the year ended Dec. 31, 2012, charged to
exploration and evaluation expense.
During the six months ended June 30, 2012, Sonde recorded an
impairment of C$16.2 million (C$12.1 million in the Southern
Alberta CGU, C$2.4 million in the Central Alberta CGU, and
C$1.7 million in the Northern Alberta CGU) to reflect low natural
gas prices.
"In 2012 cash flow was augmented by the Feb. 8, 2012 sale of
24,383 net acres of undeveloped land in the Kaybob Duvernary play
in Central Alberta for cash proceeds of C$75 million, resulting in
a gain of C73.4 million."
Going Concern Uncertainty
According to the regulatory Form 6-K filing, for the three months
ended June 30, 2013, the Company had an operating loss of
C$2.3 million and an accumulated deficit of C$265.8 million. In
addition, the Company believes significant uncertainties about the
its inability to meet its three exploratory well obligation in
respect of the Joint Oil Block cast substantial doubt about the
Company's ability to continue as a going concern.
Balance Sheet
The Company's balance sheet at June 30, 2013, showed
C$177.2 million in total assets, C$35.8 million in total
liabilities, and stockholders' equity of C$141.4 million.
A copy of the Form 6-K is available at http://is.gd/1EABRO
About Sonde Resources
Sonde Resources Corp. (TSX: SOQ) (NYSE MKT: SOQ) --
http://www.sonderesources.com/-- is a Calgary, Alberta, Canada
based energy company engaged in the exploration and production of
oil and natural gas. Its operations are located in Western Canada
and offshore North Africa.
SOUND SHORE: Court Enters Corrected Final DIP Order
---------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
issued a corrected final order authorizing Sound Shore Medical
Center of Westchester, et al., to obtain a revolver loan from of
up to $23 million and a $10 million term loan from MidCap
Financial, LLC and other lenders.
The Debtors are also authorized access to the cash collateral.
A full-text copy of the Court's Corrected Final DIP Order dated
July 17, 2013 is available at:
http://bankrupt.com/misc/SOUNDSHORE_CorrectedDIPOrd.PDF
About Sound Shore Medical
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 Garfunkel Wild, P.C. as counsel; Alvarez &
Marsal Healthcare Industry Group, LLC, as financial advisors; and
GCG Inc., as claims agent.
Montefiore, the proposed purchaser of the assets, 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.
SOUND SHORE: Gets Nod for $54-Mil. Sale to Montefiore
-----------------------------------------------------
Law360 reported that a New York bankruptcy judge approved the sale
of Sound Shore Health System Inc., blessing a $54 million deal
that sees the Westchester County hospital group acquired by Bronx-
based Montefiore Health System Inc.
According to the report, U.S. Bankruptcy Judge Robert D. Drain
agreed to sign off on the deal, which includes nearly all of Sound
Shore's assets, at a hearing in White Plains.
"No substantive objections to the sale were raised," Sound Shore
attorney Burton S. Weston told Law360. The sale order is being
finalized, the report said.
About Sound Shore
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.
SOUTHERN STATES: Moody's Rates $130MM Notes B2 & Affirms B1 CFR
---------------------------------------------------------------
Moody's Investors Service assigned a B2 rating on Southern States
Cooperative, Inc.'s proposed $130 million second lien notes due
2021. The B3 rating on the company's proposed $130 million
unsecured notes was withdrawn. Moody's also affirmed the company's
B1 Corporate Family Rating, B1-PD Probability of Default Rating
and SGL-3 Speculative Grade Liquidity rating. The rating outlook
remains negative.
Proceeds from the proposed offering will be used to refinance
Southern States' $130 million senior unsecured notes due 2015 and
pay related fees and expenses.
Rating assigned:
$130 million second lien notes due 2021 B2 (LGD 4, 68%)
Rating withdrawn:
$130 million senior unsecured notes due 2021 at B3 (LGD 5, 76%)
Ratings affirmed:
Corporate Family Rating at B1
Probability of Default Rating at B1-PD
Speculative Grade Liquidity rating at SGL-3
$130 million senior unsecured notes due 2015 at B3 (LGD 5, 84%)
The B3 rating on Southern States' senior unsecured notes due 2015
will be withdrawn upon completion of the refinancing.
Ratings Rationale:
The B2 rating assigned to the proposed notes reflects the second
lien position on substantially all assets of the company. While
subordinated to the first lien position of the $300 million
secured asset based (ABL) credit facility, the proposed second
lien notes benefit from the sizeable level of junior claims in the
capital structure in the form of unsecured multiemployer pension
liabilities, trade payables and lease rejection claims in a
default scenario.
Southern States' B1 Corporate Family Rating reflects the company's
high degree of earnings and cash flow volatility driven by factors
such as weather and commodity price levels which tend to fluctuate
based on supply and demand. This volatility can lead to
significant fluctuations in sales, profitability and credit
metrics. The rating also reflects Southern States' low absolute
profit margins and limited pricing advantage stemming from the
commoditized nature of its products. The rating is supported by
the company's strong competitive position as an agricultural
supplier in the Mid-Atlantic and Southeastern U.S., its highly
diversified customer base, and the favorable long-term
fundamentals of commercial agriculture that underpin stable future
demand for products, including population growth and proliferation
of industrial applications such as production of bio-fuels. The
company's liquidity is adequate.
The rating outlook remains negative reflecting the risk that the
company may be unable to improve credit metrics to levels
acceptable for the B1 rating category over the next 12 to 18
months. The outlook also reflects the need to complete the
refinancing transaction well in advance of the October 15, 2014
expiration of its current ABL revolver.
Southern States' ratings could be downgraded if it appears that
the company will fail to further improve performance and credit
metrics over the coming year, particularly if it appears that
debt/EBITDA will be sustained above 5.5 times and EBITA-to-
interest below 1.3 times. A downgrade could also occur if the
company does not maintain adequate liquidity, either through
failure to address the refinancing of debt obligations well in
advance of their maturities, or if substantial excess revolver
availability is not sustained.
In view of Southern States' high level of business volatility and
negative ratings outlook, a ratings upgrade is unlikely over the
near-to-intermediate term. Over time, further diversification and
greater scale while sustaining higher operating and cash flow
margins would be viewed positively.
The closing of the proposed refinancing would lead to an
improvement in liquidity and Moody's re-evaluation of the SGL-3
rating.
Headquartered in Richmond, Virginia, Southern States Cooperative,
Inc. is a retailer and wholesale supplier of a diversified array
of agricultural products and services, such as fertilizer, seed,
crop protectants, animal feed, petroleum, and farm and home
supplies.
Southern States Cooperative, Inc.'s ratings were assigned by
evaluating factors that Moody's considers relevant to the credit
profile of the issuer, such as the company's (i) business risk and
competitive position compared with others within the industry;
(ii) capital structure and financial risk; (iii) projected
performance over the near to intermediate term; and (iv)
management's track record and tolerance for risk. Moody's compared
these attributes against other issuers both within and outside
Southern States Cooperative, Inc.'s core industry and believes
Southern States Cooperative, Inc.'s ratings are comparable to
those of other issuers with similar credit risk. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
SOUTHERN STATES: S&P Assigns 'B' Rating to $130MM 2nd-Lien Notes
----------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its 'B'
issue-level rating to Richmond, Va.-based Southern States
Cooperative Inc.'s proposed $130 million second-lien secured notes
due 2021. The recovery rating on this debt is '4', indicating
S&P's expectation for average recovery (30%-50%) in the event of a
payment default. The rating is based on preliminary terms and
conditions.
At the same time, S&P is withdrawing the 'B' issue-level rating
and '4' recovery rating that it assigned on July 25, 2013, to the
company's proposed senior unsecured notes. Pro forma for the
proposed transaction, total debt outstanding is unchanged at about
$137 million.
On July 25, 2013, S&P affirmed its ratings on Southern States to
reflect its opinion that the cooperative's financial risk profile
remains "highly leveraged," despite improving credit measures
following much better performance in fiscal 2013. S&P's
assessment of the cooperative's business risk profile remains
"vulnerable," primarily reflecting its inherent seasonality, very
low operating margins, and volatile earnings.
RATINGS LIST
Southern States Cooperative Inc.
Corporate credit rating B/Stable/--
Ratings assigned
Southern States Cooperative Inc.
Senior secured
$130 mil. second-lien notes due 2021 B
Recovery rating 4
Ratings withdrawn
To From
Southern States Cooperative Inc.
Senior unsecured
$130 mil. notes N.R. B
Recovery rating N.R. 4
STELLAR BIOTECHNOLOGIES: Obtains License to "C. diff" Technology
----------------------------------------------------------------
Stellar Biotechnologies, Inc., has acquired the exclusive,
worldwide license to patented technology for the development of
human immunotherapies against Clostridium difficile infection ("C.
diff") from the University of Guelph (Ontario, Canada).
The license gives Stellar exclusive rights to develop, manufacture
and sell human vaccines to treat C. diff infection that derive
from technology covered by Guelph patents. The license also
includes human diagnostic applications. Specifically, the
agreement covers a family of international patents and patent
applications related to the cell-wall polysaccharide of C. diff
named PSII.
"This opens significant new opportunities for Stellar and is an
excellent fit in our goal to secure complementary technologies for
strategic expansion," said Frank Oakes, Stellar president and CEO.
"We hold the world's leading technology for sustainable
manufacture of KLH protein and now we have a strong platform for
Stellar's first proprietary, active immunotherapy program."
Herbert Chow, Ph.D., Stellar chief technology officer said, "A
PSII-KLH conjugate has the potential to be a major infectious
disease immunotherapy, and we are concurrently proving the utility
of Stellar KLH as a mucosal adjuvant in vaccines which opens the
door for a multitude of new uses for Stellar KLH technology."
Working under an option agreement executed last year, Stellar and
Guelph scientists demonstrated in preclinical studies that
conjugate vaccines combining PSII technology with Stellar's KLH
protein as adjuvant can protect against primary and secondary C.
diff infection. Last week, Stellar announced that results from
the studies will be presented at the International ClostPath
Conference this October.
University of Guelph professor Mario Monteiro, discoverer of the
C. difficile Polysaccharide II, said, "Stellar's vision has made
it possible for our scientific discovery to migrate from the lab
to the hands of industry. I'm confident that in time, this
vaccine will prove to have saved many lives."
"One of our goals at the University of Guelph is to move
scientific discoveries out of the laboratories and put them to use
to improve the quality of people's health and daily lives," said
Kevin Hall, Guelph Vice-President Research. "There is no better
way to do this than using academic expertise to help industry
develop promising new applications that can have a positive impact
globally."
The agreement provides for Stellar to pay Guelph license fees in a
combination of cash, stock and warrants, and milestone payments
upon achievement of financing, development and sales targets.
Stellar will pay royalties on revenues and reimburse patent costs.
Within 30 days of the effective date of the agreement and subject
to TSX Venture Exchange approval, Guelph will receive 371,200
common shares and 278,400 warrants. Each warrant provides Guelph
the right to purchase one common share on or before Jan. 24, 2015,
at a purchase price of CDN$1.25 per share. All securities issued
under this agreement are subject to a hold period of four months
and one day from the date of issuance.
About Stellar
Port Hueneme, Cal.-based Stellar Biotechnologies, Inc.'s
business is to commercially produce and market Keyhole Limpet
Hemocyanin ("KLH") as well as to develop new technology related to
culture and production of KLH and subunit KLH ("suKLH")
formulations. The Company markets KLH and suKLH formulations to
customers in the United States and Europe.
KLH is used extensively as a carrier protein in the production of
antibodies for research, biotechnology and therapeutic
applications.
The Company's balance sheet at March 31, 2013, showed
US$1.4 million in total assets, US$4.6 million in total
liabilities, and a stockholders' deficit of US$3.2 million.
The Company reported a net loss of US$4.4 million on US$177,208 of
revenues for the six months ended Feb. 28, 2013, compared with a
net loss of US$2.1 million on US$193,607 of revenues for the six
months ended Feb. 29, 2012.
SUN BANCORP: Files Copy of Investor Presentation with SEC
---------------------------------------------------------
Members of the executive management team of Sun Bancorp, Inc.,
delivered with the U.S. Securities and Exchange Commission on
July 30, 2013, a presentation regarding the Company's financial
performance to analysts and investors at the 14th Annual KBW
Community Bank Investor Conference. Copies of the slides used in
the presentation are available for free at http://is.gd/Om4bAi
About Sun Bancorp
Sun Bancorp, Inc. (NASDAQ: SNBC) is a $3.23 billion asset bank
holding company headquartered in Vineland, New Jersey, with its
executive offices located in Mt. Laurel, New Jersey. Its primary
subsidiary is Sun National Bank, a full service commercial bank
serving customers through more than 60 locations in New Jersey.
On April 15, 2010, Sun National Bank entered into a written
agreement with the OCC which contained requirements to develop and
implement a profitability and capital plan which provides for the
maintenance of adequate capital to support the Bank's risk profile
in the current economic environment.
As of June 30, 2013, the Company had $3.20 billion in total
assets, $2.94 billion in total liabilities and $261.66 million in
total shareholders' equity.
SUNTECH POWER: CSL's Mike Nacson, GEM's Kurt Metzger Join Board
---------------------------------------------------------------
Suntech Power Holdings Co., Ltd., has appointed two new members to
the Company's Board of Directors, Mr. Michael Nacson and Mr. Kurt
Metzger. The two Board members were nominated by the holders of
the Company's 3 percent Convertible Notes as a condition of the
Forbearance Agreement announced on June 28th. The additions bring
the total number of board members to nine.
Mr. Nacson has more than 25 years of senior management and board-
level experience in the Asia-Pacific region and has worked
extensively with businesses with distressed debt and undergoing
corporate restructuring. Mr. Nacson is currently a Principal at
CSL, an Asia-based corporate transactions advisory company and
outsourced CFO provider. He has previously held positions as a
Managing Director, CFO, CRO, CPO, executive and non-executive
director of a number of Asia Pacific companies in the technology,
chemical, real-estate, business consulting, manufacturing,
finance, electronics, communications and transportation
industries. Educated in the UK, Mr. Nacson previously worked as a
Partner in Arthur Andersen's Hong Kong Corporate Restructuring
Practice.
Mr. Metzger has over 20 years of senior management experience
providing financial services and counsel to financially distressed
companies and growth stage companies. He is currently a principal
at GEM Advisory, a management consulting company, and has held
positions as a CRO and CFO in alternative asset management, bio-
energy, petrochemical, textiles, IT and clean energy investment
companies. Previously, Mr. Metzger worked for Ferrier Hodgson, a
leading financial advisor for corporate debt, restructuring and
turnaround management. Prior to that, he spent 16 years with
Fleet Boston Financial Corp where he last served as the Deputy MD,
Asia Fixed Income. Mr. Metzger holds a BA in Economics with a
concentration in Alternative Energy from Brown University.
Ms. Susan Wang, the chairperson of Suntech's board, said, "We
would like to welcome our two new board members. Messrs. Nacson
and Metzger come with credentialed experience in restructuring
and, in my view, will help benefit Suntech in the coming months."
About Suntech
Wuxi, China-based Suntech Power Holdings Co., Ltd. (NYSE: STP)
produces solar products for residential, commercial, industrial,
and utility applications. With regional headquarters in China,
Switzerland, and the United States, and gigawatt-scale
manufacturing worldwide, Suntech has delivered more than
25,000,000 photovoltaic panels to over a thousand customers in
more than 80 countries.
As reported by the TCR on March 20, 2013, Suntech Power Holdings
Co., Ltd., has received from the trustee of its 3% Convertible
Notes a notice of default and acceleration relating to Suntech's
non-payment of the principal amount of US$541 million that was due
to holders of the Notes on March 15, 2013. That event of default
has also triggered cross-defaults under Suntech's other
outstanding debt, including its loans from International Finance
Corporation and Chinese domestic lenders.
SUNWIN STEVIA: RBSM LLP Raises Going Concern Doubt
--------------------------------------------------
Sunwin Stevia International, Inc., filed with the U.S. Securities
and Exchange Commission on Aug. 2, 2013, its annual report on Form
10-K for the fiscal year ended April 30, 2013.
RBSM LLP, in New York, expressed substantial doubt about Sunwin
Stevia's ability to continue as a going concern, citing the
Company's operating losses and negative cash flows from
operations.
The Company reported a net loss of $4.0 million on $9.8 million of
revenues in fiscal 2013, compared to a net loss of $4.3 million on
$11.5 million of revenues in fiscal 2012.
The Company's balance sheet at April 30, 2013, showed
$30.9 million in total assets, $4.6 million in total current
liabilities, and stockholders' equity of $26.3 million.
A copy of the Form 10-K is available at http://is.gd/cPUd0I
Shandong, China-based Sunwin Stevia International, Inc., a Nevada
corporation, sells stevioside, a natural sweetener, as well as
herbs used in traditional Chinese medicines and veterinary
products. Substantially all of the Company's operations are
located in the People's Republic of China.
SW BOSTON: 1st Circ. Urged Not to Reinstate Ch. 11 Plan
-------------------------------------------------------
Law360 reported that the Mortgage Bankers Association urged the
First Circuit not to reinstate a bankruptcy court order confirming
the reorganization plan of the developers of the luxury W Boston
Hotel, saying the precedent set by the order would unfairly
increase risks for commercial mortgage lenders.
According to the report, in an amicus brief, the association
argued that a bankruptcy appeals panel had correctly vacated the
order confirming the plan, which had "erroneously" allowed a
substantive consolidation of the assets and liabilities of debtor
SW Boston Hotel Venture LLC and related affiliates.
About SW Boston Hotel
Boston, Massachusetts-based SW Boston Hotel Venture LLC is the
developer of the W Hotel in Boston. The Company filed for Chapter
11 bankruptcy protection (Bankr. D. Mass. Case No. 10-14535) on
April 28, 2010. Harold B. Murphy, Esq., and Natalie B. Sawyer,
Esq., at Hanify & King, P.C., is the Debtors' bankruptcy counsel.
Edwards Angell Palmer & Dodge LLP is the Company's special
counsel. The Company estimated its assets and debts at
$100 million to $500 million.
T3 MOTION: Appeals NYSE's Delisting Determination
-------------------------------------------------
T3 Motion sent a letter to NYSE MKT, LLC, specifically to the
Committee on Securities of NYSE MKT, LLC, requesting an appeal of
the July 8, 2013, decision of the Listing Qualifications Panel of
the Committee affirming the determination of the Exchange's
Corporate Compliance staff to delist the Company's common stock.
One July 29, 2013, the Company received notification of approval
from counsel to the Committee that the Committee will consider the
matter on Sept. 17, 2013, at the offices of the Exchange.
The Company had received a letter on July 8, 2013, from the NYSE
MKT stating that the Panel was denying the Company's appeal on the
previous delisting proceedings and affirming the decision of the
NYSE MKT staff to delist the Company from the NYSE MKT because of
the Company's financial impairment.
The July 8, 2013, letter stated that initiating any such review
would not stay the Panel's decision and that the NYSE MKT will
suspend trading in the Company's common stock "as soon as
practicable" in accordance with Section 1204(d) of the NYSE MKT's
Company Guide and will file an application with the SEC to strike
the Company's common stock from listing and registration with the
NYSE MKT when and if authorized, in accordance with Sections
1205(g), 1206(d) or 1206(e) of the NYSE MKT's Company Guide. The
Company's common stock currently trades on OTC-BB.
Issues 2 Million Shares
T3 Motion issued 2,050,000 shares of the Company's unregistered
common stock to three accredited investors in exchange for the
conversion of $205,000 face value of Convertible Debentures issued
on Nov. 27, 2012.
About T3 Motion
Costa Mesa, Calif.-based T3 Motion, Inc., develops and
manufactures T3 Series vehicles, which are electric three-wheel
stand-up vehicles that are directly targeted to the public safety
and private security markets.
T3 Motion reported a net loss of $21.52 million on $4.51 million
of net revenues for the year ended Dec. 31, 2012, as compared with
a net loss of $5.50 million on $5.29 million of net revenues
during the prior year. The Company's balance sheet at March 31,
2013, showed $3.07 million in total assets, $19.63 million in
total liabilities, all current, and a $16.55 million total
stockholders' deficit.
"The Company has incurred significant operating losses and has
used substantial amounts of working capital in its operations
since its inception (March 16, 2006). Further, at March 31, 2013,
the Company had an accumulated deficit of $(76,980,775) and used
cash in operations of $(1,614,252) for the three months ended
March 31, 2013. These factors raise substantial doubt about the
Company's ability to continue as a going concern for a reasonable
period of time," according to the Company's Form 10-Q for the
period ended March 31, 2013.
T-L CHEROKEE: Sept. 26 Hearing on Continued Cash Collateral Use
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Indiana, according
to T-L Cherokee South LLC's case docket, will convene a hearing on
Sept. 26, 2013, at 1 p.m. to consider the Debtor's continued
access to cash collateral which Cole Taylor Bank asserts an
interest.
The Court has permitted the Debtor's interim use of cash
collateral through Sept. 30.
As reported in the Troubled Company Reporter on Feb. 12, 2013,
Cole Taylor Bank asserts a first position mortgage lien and claim
against its shopping center property which purportedly secures a
senior mortgage indebtedness of $14.35 million. In addition to
its mortgage liens on the property, Cole Taylor asserts a security
interest in and lien upon the rents being generated at the
property.
Cole Taylor Bank has filed a limited objection to the Disclosure
Statement explaining T-L Cherokee's Chapter 11 Plan.
According to papers filed with the Court, the Debtor proposes to
use cash collateral and provide adequate protection to Cole Taylor
upon these terms and conditions:
A. The Debtor will permit Cole Taylor to inspect, upon
reasonable notice, within reasonable hours, the Debtor's
books and records;
B. The Debtor will maintain and pay premiums for insurance to
cover all of its assets from fire, theft and water damage;
C. The Debtor will maintain sufficient cash reserves for the
payment of current real estate taxes when such real estate
taxes become due and payable;
D. The Debtor shall, upon reasonable request, make available to
Cole Taylor evidence of that which purportedly constitutes
its collateral or proceeds;
E. The Debtor will properly maintain the property in good
repair and properly manage such Property; and
F. Cole Taylor will be granted valid, perfected, enforceable
security interests in and to the Debtor's postpetition
assets, including all proceeds and products which are now or
hereafter become property of the estate to the extent and
priority of its alleged pre-petition liens, if valid, but
only to the extent of any diminution in the value of the
assets serving as collateral.
About T-L Cherokee
T-L Conyers LLC, T-L Cherokee South, LLC, and two affiliates
sought Chapter 11 protection in Hammond, Indiana, on Feb. 1, 2013.
The Debtors are represented by David K. Welch, Esq., at Crane,
Heyman, Simon, Welch & Clar, in Chicago.
The Debtors own various shopping centers in Georgia and Kansas.
T-L Cherokee South (Bankr. N.D. Ind. Case No. 13-20283) disclosed
undetermined assets and $17.8 million in liabilities as of the
Chapter 11 filing. T-L Cherokee owns and operates a commercial
shopping center in Overland Park, Kansas, known as "Cherokee South
Shopping Center".
The Debtors are entities managed by Westchester, Illinois-based
Tri-Land Properties, Inc., which sought Chapter 11 protection
(Case No. 12-22623) on July 11, 2012.
Richard M. Bendix, Esq., at Dykema Gossett PLLC, represents pre-
bankruptcy lender Cole Taylor Bank as counsel.
TARGETED MEDICAL: Stockholders Elect Four Directors
---------------------------------------------------
Targeted Medical Pharma, Inc., held its 2013 annual meeting of
stockholders on July 22, 2013, at which the stockholders, among
other things:
(1) elected Kim Giffoni, Donald J. Webster, William E. Shell,
M.D., and Scott Gottlieb, M.D., to serve on the Company's
board of directors for a term of one year;
(2) approved an amendment to Article FOURTH of the Company's
Second Amended and Restated Certificate of Incorporation to
effect a reverse stock split of the Company's common stock
at a ratio of between one-for-two and one-for-ten with that
ratio to be determined at the sole discretion of the Board
and with such Reverse Split to be effected at that time and
date, if at all, as determined by the Board in its sole
discretion;
(3) approved a non-binding advisory vote on the Company's 2012
executive compensation; and
(4) selected "every three years" as the desired frequency of
future advisory vote on executive compensation.
About Targeted Medical
Los Angeles, Calif.-based Targeted Medical Pharma, Inc., is a
specialty pharmaceutical company that develops and commercializes
nutrient- and pharmaceutical-based therapeutic systems.
Targeted Medical disclosed a comprehensive loss of $9.58 million
on $7.29 million of total revenue for the year ended Dec. 31,
2012, as compared with a comprehensive loss of $4.18 million on
$8.81 million of total revenue during the prior year.
The Company's balance sheet at March 31, 2013, showed $12.22
million in total assets, $14.20 million in total liabilities and a
$1.98 million total shareholders' deficit.
EFP Rotenberg, LLP, in Rochester, 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 losses for the year ended Dec. 31, 2012,
totaling $9,586,182 as well as accumulated deficit amounting to
$13,684,789. Further the Company does not have adequate cash and
cash equivalents as of Dec. 31, 2012, to cover projected operating
costs for the next 12 months. As a result, the Company is
dependent upon further financing, related party loans, development
of revenue streams with shorter collection times and accelerating
collections on the Company's physician managed and hybrid revenue
streams.
TITAN ENERGY: Posts $281,000 Net Income in Second Quarter
---------------------------------------------------------
Titan Energy Worldwide, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
net income of $281,267 on $6.43 million of net sales for the three
months ended June 30, 2013, as compared with a net loss of $70,137
on $5.34 million of net sales for the same period during the prior
year.
For the six months ended June 30, 2013, the Company posted net
income of $1,707 on $11.08 million of net sales, as compared with
a net loss of $687,836 on $8.61 million of net sales for the same
period a year ago.
Titan Energy disclosed a net loss of $1.43 million on
$19.15 million of net sales for the year ended Dec. 31, 2012, as
compared with a net loss of $3.43 million on $14.06 million of net
sales for the year ended Dec. 31, 2011.
As of June 30, 2013, the Company had $5.76 million in total
assets, $9.48 million in total liabilities and a $3.71 million
total stockholders' deficit.
Going Concern
The Company believes it will be profitable for the year 2013 and
is in the process of restructuring its balance sheet. However the
Company said that until it is successful in completing these
items, the accumulated deficit and the notes that are in default
raise substantial doubt as to the Company's ability to continue as
a going concern. Management has taken these steps that it
believes will be sufficient to provide the Company with the
ability to continue its operations:
"Management has entered into an agreement with Forefront
Capital to raise up to $5 million on a best efforts basis.
While there is no guarantee that these efforts will result in
any new capital for the Company, these potential funds would
have a significant impact on the Company's ability to
restructure its debt and improve its cash flow.
Management has been successful in having the majority of the
Convertible Notes extend their due date to July 1, 2014.
These extensions were achieved to allow the Company the time
to complete its restructuring of the balance sheets. These
note holders will convert their notes and accrued interest
into equity if the item above is successful.
Management will continue to take steps to expand and increase
its service sales and work order flow. Service sales account
for the highest margins of any business segment and the
quickest turnaround in terms of customer payments.
Management will seek to either restructure or replace its
existing factoring agreement with either an asset based or
bank line of credit before the end of the year 2013.
Management believes the company is eligible for a lower cost
lending facility and that this could save the Company up to
$300,000 a year in interest and fees."
The Company's interim financial statements for the period ended
June 30, 2013, have not been reviewed by an independent public
accountant with professional standards for conducting those
reviews, as established by generally accepted auditing standards,
as may be modified or supplemented by the Securities and Exchange
Commission. The review was not completed due to the cost and
availability of cash required to pay past due fees owed to the
Company's independent accountant.
A copy of the Form 10-Q is available for free at:
http://is.gd/Uq1uWQ
About Titan Energy
New Hudson, Mich.-based Titan Energy Worldwide, Inc., is a
provider of onsite power generation, energy management and energy
efficiency products and services.
TOUSA INC: Ch. 11 Liquidation Plan Confirmed by Florida Judge
-------------------------------------------------------------
Law360 reported that a Florida bankruptcy judge confirmed the
Chapter 11 liquidation plan for Tousa Inc. despite objections from
the U.S. trustee, ending the beleaguered homebuilder's protracted,
five-year stay in bankruptcy.
According to the report, U.S. Bankruptcy Judge John K. Olson
confirmed the plan over concerns by the U.S. Trustee's Office
regarding third-party releases, the process for fee request
applications and the fate of undistributed funds.
"People negotiated this plan painfully," Judge Olson said, the
report related. "This is an integrated document."
About TOUSA Inc.
Headquartered in Hollywood, Florida, TOUSA, Inc. (Pink Sheets:
TOUS) -- http://www.tousa.com/-- fka Technical Olympic U.S.A.
Inc., dba Technical U.S.A., Inc., Engle Homes, Newmark Homes L.P.,
TOUSA Homes Inc. and Newmark Homes Corp. is a leading homebuilder
in the United States, operating in various metropolitan markets in
10 states located in four major geographic regions: Florida, the
Mid-Atlantic, Texas, and the West.
The Debtor and its debtor-affiliates filed for separate
Chapter 11 protection on Jan. 29, 2008 (Bankr. S.D. Fla. Case
No. 08-10928). Richard M. Cieri, Esq., M. Natasha Labovitz,
Esq., and Joshua A. Sussberg, Esq., at Kirkland & Ellis LLP, in
New York, N.Y.; and Paul S. Singerman, Esq., at Berger Singerman,
in Miami, Fla., represent the Debtors in their restructuring
efforts. Lazard Freres & Co. LLC is the Debtors' investment
banker. Ernst & Young LLP is the Debtors' independent auditor and
tax services provider. Kurtzman Carson Consultants LLC acts as
the Debtors' Notice, Claims & Balloting Agent.
TOUSA's direct subsidiary, Beacon Hill at Mountain's Edge LLC dba
Eagle Homes, filed for Chapter 11 Protection on July 30, 2008
(Bankr. S.D. Fla. Case No. 08-20746). It estimated assets and
debts of $1 million to $10 million in its Chapter 11 petition.
Daniel H. Golden, Esq., and Philip C. Dublin, Esq., at Akin Gump
Strauss Hauer & Feld LLP, in New York, N.Y., represent the
creditors committee.
The unsecured creditors committee initially proposed a chapter 11
liquidating plan for Tousa. However, the committee decided not to
pursue approval of its liquidation plan because of a pending
appeal of its fraudulent transfer action in the U.S. Court of
Appeals for the Eleventh Circuit. In May 2012, the Court of
Appeals in Atlanta held that Tousa's bank lenders received
fraudulent transfers exceeding $400 million.
After mediation before Peter L. Borowitz, Tousa and the unsecured
creditors committee, MatlinPatterson Global Advisers and Monarch
Alternative Capital, as investment adviser to Monarch Master
Funding, collectively reached an agreement in principle on a
settlement proposal. The proposal would form the foundation for a
joint bankruptcy-exit plan for the Debtors.
In May 2013, Tousa and the unsecured creditors committee filed a
proposed liquidating Chapter 11 plan.
On July 12, 2013, Tousa won court approval of a $67 million
settlement with several insurance companies allowing the Debtors
to proceed with an Aug. 1 hearing to confirm the plan. The
dispute with the insurance companies involved the pre-bankruptcy
fraudulent transfers. The insurance companies included Federal
Insurance Co., XL Specialty Insurance Co. and Zurich American
Insurance Co.
According to Bloomberg News, in settlement, the insurance
companies will pay $67 million, with $47.9 million going to
creditors of the Tousa companies that were forced to take on debt
improperly. The first-lien lenders receive $7.66 million, while
second-lien lenders take home $11.5 million. Some of the
insurance companies also pay $8.27 million of the directors' and
officers' defense costs.
Bloomberg relates Tousa's Chapter 11 plan has recoveries ranging
from 58 percent for senior noteholders to 5 percent for creditors
with general unsecured claims. The plan was the result of the
decision from the appeals court in May 2012 finding banks received
fraudulent transfers exceeding $400 million. The opinion
reinstated a ruling by U.S. Bankruptcy Judge John K. Olson which
had been set aside on the first appeal in federal district court.
TRANS-LUX CORP: Extends Warrants Exercise Period to Aug. 16
-----------------------------------------------------------
The Board of Directors of Trans-Lux Corporation unconditionally
further extended the exercise period of the Company's outstanding
A Warrants. Holders of the A Warrants may now exercise their
rights thereunder through Aug. 16, 2013. The Board of Directors
provided for this additional extension in order to provide the
holders with more time within which to exercise their A Warrants.
As part of the Company's restructuring plan, on Nov. 14, 2011, the
Company completed the sale of an aggregate of $8.3 million of
securities consisting of 416,500 shares of the Company's Series A
Convertible Preferred Stock, par value $0.001 per share having a
stated value of $20.00 per share and convertible into 50 shares of
the Company's Common Stock, par value $0.001 per share and
4,165,000 one-year warrants. These securities were issued at a
purchase price of $20,000 per unit. Each Unit consists of 1,000
shares of Preferred Stock, which have subsequently converted into
50,000 shares of Common Stock and 10,000 A Warrants. Each A
Warrant entitles the holder to purchase one share of the Company's
Common Stock and a three-year warrant, at an exercise price of
$0.20 per share. Each B Warrant will entitle the holder to
purchase one share of the Company's Common Stock at an exercise
price of $0.50 per share. The exercise period under the A
Warrants was originally set to expire on Nov. 14, 2012, and was
previously extended by the Company's Board of Directors through
July 31, 2013.
About Trans-Lux Corporation
Norwalk, Conn.-based Trans-Lux Corporation (NYSE Amex: TLX) is a
designer and manufacturer of digital signage display solutions for
the financial, sports and entertainment, gaming and leasing
markets.
For the year ended Dec. 31, 2012, the Company incurred a net loss
of $1.36 million on $23.02 million of total revenues, as compared
with a net loss of $1.41 million on $23.75 million of total
revenues during the prior year.
As of March 31, 2013, the Company had $20 million in total assets,
$18.31 million in total liabilities and $1.69 million in total
stockholders' equity.
"Our independent registered public accounting firm has issued an
opinion on our consolidated financial statements that states that
the consolidated financial statements were prepared assuming we
will continue as a going concern and further states that the
continuing losses and uncertainty regarding the ability to make
the required minimum funding contributions to the pension plan as
well as the sinking fund payments on the Debentures and the
principal and interest payments on the Notes and the Debentures
raises substantial doubt about our ability to continue as a going
concern. As a result, if the Company is unable to (i) obtain
additional liquidity for working capital, (ii) make the required
minimum funding contributions to the pension plan and (iii) make
the required principal and interest payments on the Notes and
Debentures, there would be a significant adverse impact on the
financial position and the operating results of the Company,"
according to the Company's annual report for the year ended
Dec. 31, 2012.
TRIUS THERAPEUTICS: Inks Merger Agreement with Cubist Pharma
------------------------------------------------------------
Cubist Pharmaceuticals, Inc., and its wholly-owned subsidiary,
BRGO Corporation, entered into an Agreement and Plan of Merger
with Trius Therapeutics, Inc., which was approved by the boards of
directors of the companies. Pursuant to the Merger Agreement,
BRGO will commence a tender offer to purchase all of the issued
and outstanding shares of Trius common stock for (a) $13.50 per
share in cash, plus (b) one non-transferrable contingent value
right for each share of Trius common stock, which represents the
contractual right to receive up to $2.00 per share upon the
achievement of certain milestones. If successful, the Offer will
be followed by a merger of BRGO with and into Trius.
In connection with the Merger Agreement, the Company and BRGO
entered into Tender and Voting Agreements with certain Trius
stockholders, pursuant to which those stockholders have agreed to
tender into the Offer a number of shares held by those
stockholders equal to approximately 22 percent of Trius's issued
and outstanding common stock.
The consummation of the Offer and Merger are subject to various
closing conditions including the expiration of the applicable
waiting period under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended, and other customary conditions. The
Merger Agreement also includes certain termination rights for both
Trius and the Company and provides that, in connection with the
termination of the Merger Agreement under specified circumstances,
Trius will be required to pay the Company a termination fee of
$23.3 million. Additionally, under certain circumstances in the
case of a failure to obtain required antitrust clearances, the
Company may be required to pay Trius $38.8 million upon
termination of the Merger Agreement.
A copy of the Agreement and Plan of Merger is available at:
http://is.gd/TfDEu1
About Trius Therapeutics
San Diego, Calif.-based Trius Therapeutics, Inc. (Nasdaq: TSRX) --
http://www.triusrx.com/-- is a biopharmaceutical company focused
on the discovery, development and commercialization of innovative
antibiotics for serious, life-threatening infections. The
Company's first product candidate, torezolid phosphate, is an IV
and orally administered second generation oxazolidinone being
developed for the treatment of serious gram-positive infections,
including those caused by MRSA. In addition to the company's
torezolid phosphate clinical program, it is currently conducting
two preclinical programs using its proprietary discovery platform
to develop antibiotics to treat infections caused by gram-negative
bacteria.
Trius Therapeutics incurred a net loss of $53.92 million in 2012,
a net loss of $18.25 million in 2011 and a $23.86 million net loss
in 2010. The Company's balance sheet at March 31, 2013, showed
$89.81 million in total assets, $17.54 million in total
liabilities, and $72.27 million in total stockholders' equity.
UNITEK GLOBAL: Closes Credit Amendment with Term Lenders
--------------------------------------------------------
UniTek Global Services, Inc., has closed the previously announced
amendment to its Term Credit Agreement which amendment waives all
existing defaults and resets financial and other covenants related
to the Company's previously announced financial restatements. The
facility will keep its original maturity date of April 15, 2018.
In connection with the Term Amendment, the Company has issued to
the Term Lenders warrants, exercisable at $0.01 per share, for
shares of the Company's common stock equal to 19.99 percent of the
shares outstanding prior to the date of the Term Amendment. The
Company has also entered into a customary registration rights
agreement with the Term Lenders, pursuant to which it has
committed to register the resale of the shares of common stock
underlying the Warrants.
The Company entered into the Term Credit Agreement on April 15,
2011, with several banks and other financial institutions, and
Cerberus Business Finance, LLC, as administrative agent.
The amended term loan will continue to bear monthly interest
payable in cash at a rate equal either to LIBOR (with a 1.50
percent floor) plus 9.50 percent or the prime rate plus 8.50
percent, plus, in either case, an amount to be added to the
principal balance of the term loan at an annual rate equal to 4.00
percent of the outstanding balance.
In conjunction with the closing of the Term Amendment, the
previously issued 180-day notice of the termination of the master
services agreement between the Company's DirectSat subsidiary and
DIRECTV, LLC, has been withdrawn.
Rocky Romanella, chief executive officer of UniTek Global
Services, said, "We are grateful for DIRECTV's ongoing support.
Their willingness to work with us through our efforts to refinance
the debt is indicative of the strength of our relationship, and we
are pleased to be in a position to continue in our role as an
integrated, value-added fulfillment service provider for them."
Dave Baker, senior vice president of DIRECTV, stated, "We are
pleased that UniTek was able to satisfy the requirements for the
automatic withdrawal of the termination notice. Throughout this
process, they have maintained the high levels of service and
performance that we have come to expect from them, and we look
forward to continuing our relationship."
"Our work on the financial restatements is progressing toward
completion, and with the recently closed refinancing of the ABL
Revolver, this comprehensive amendment to our Term Loan and the
rescission of the DIRECTV termination notice, our team is more
energized and more committed than ever to meeting our near- and
longer-term growth objectives. We have made great progress
recently, and look forward to the completion of additional
milestone events in this process," concluded Mr. Romanella.
About UniTek Global Services
UniTek Global Services, Inc., based in Blue Bell, Pennsylvania,
provides fulfillment and infrastructure services to media and
telecommunication companies in the United States and Canada.
As reported by the TCR on June 11, 2013, Standard & Poor's Ratings
Services lowered its corporate credit rating on Blue Bell, Pa.-
based UniTek Global Services Inc. to 'D' from 'CCC'. "The
downgrade follows UniTek's announcement that it did not make
a scheduled interest payment on May 29, 2013, on its senior
secured term loan due 2018, which we consider to be a default
under our timeliness of payments criteria," said Standard & Poor's
credit analyst Michael Weinstein.
In the June 11, 2013, edition of the TCR, Moody's Investors
Service lowered UniTek Global Services, Inc.'s probability of
default and corporate family ratings to Ca-PD/LD and Ca,
respectively. The Ca corporate family rating reflects UniTek's
missed interest payment on the term loan which is considered a
default under Moody's definition, the heightened possibility of
another default event, continued delays in the filing of restated
financials including the last two audits, management turnover, the
potential loss of the company's largest customer and other
business and legal risks stemming from issues at the company's
Pinnacle subsidiary.
UPH HOLDINGS: Kelley Drye Okayed Creditors Committee's Counsel
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Texas
authorized the Official Committee of Unsecured Creditors in the
Chapter 11 case of UPH Holdings, Inc., et al., to retain Kelley
Drye & Warren LLP, as its counsel.
As reported in the Troubled Company Reporter on July 24, 2013,
Craig A. Wolfe, Esq., a partner at Kelley Drye, tells the Court
that Kelley Drye's standard hourly rates for 2013 are:
Partners $550 - $875
Counsel $415 - $645
Associates $325 - $575
Paraprofessionals $200 - $275
By special agreement with the Committee, Kelley Drye has agreed to
(i) cap the rates of the three Kelley Drye bankruptcy attorneys
primarily assigned to work on these cases (Mr. Wolfe at $585/hour,
Benjamin Blaustein at $485/hour and Catherine L. Thompson at
$295/hour); and (ii) reduce the rates of all of its other
attorneys by 10 percent, subject to a blended hourly rate not to
exceed $450/hour. Kelley Drye also agreed not to bill the estates
for non-working travel time. It may be necessary for Kelley Drye
professionals other than the three attorneys primarily assigned to
the cases to provide services to the Committee as needed.
To the best of the Committee's knowledge, neither Kelley Drye nor
any of its attorneys represent any interest adverse to the
Committee in the matters on which they are to be retained.
About UPH Holdings Inc.
UPH Holdings Inc. and several affiliates filed Chapter 11
petitions (Bankr. W.D. Tex. Lead Case No. 13-bk-10570) on
March 28, 2013. Judge Tony M. Davis oversees the case. Jennifer
Francine Wertz, Esq., and Patricia Baron Tomasco, Esq., at Jackson
Walker, L.L.P., serve as the Debtors' counsel. Q Advisors, LLC
serves as financial advisors. UPH Holdings disclosed $26,917,341
in assets and $19,705,805 in liabilities as of the Chapter 11
filing.
Other affiliates that sought Chapter 11 protection are: Pac-West
Telecomm, Inc.; Tex-Link Communications, Inc.; Unipoint Holdings,
Inc.; Unipoint Enhanced Services, Inc.; Unipoint Services, Inc.;
Nwire LLC; and Peering Partners Communications LLC (Case Nos.
13-10571 to 13-10577).
Judy A. Robbins, the United States Trustee for Region 7, has
appointed a five-member Official Committee of Unsecured Creditors
in the Chapter 11 cases of UPH Holdings, Inc., Pac-West Telecomm
Inc., and their affiliated debtors.
The Committee tapped Kelley Drye & Warren LLP as its counsel, and
QSI Consulting, Inc. as its financial advisor.
UPH HOLDINGS: QSI Approved as Committee's Financial Advisor
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Texas
authorized the Official Committee of Unsecured Creditors in the
Chapter 11 case of UPH Holdings, Inc., et al., to retain QSI
Consulting, Inc., as financial advisor.
As reported in the Troubled Company Reporter on July 24, 2013, QSI
Consulting will, among other things:
a) prepare an initial written assessment of the Debtors'
inter-carrier receivables and payables;
b) perform a more detailed analysis of the Carrier Compensation
and billing issues or particular carrier accounts if
requested by the Committee; and
c) advise the Committee on carrier compensation and billing
issues that may arise during the Debtors' Chapter 11 cases,
including in connection with the sale process, any proposed
chapter 11 plan for the Debtors or other disposition of
these cases or actions to enforce, collect, settle or setoff
inter-carrier claims.
The hourly rates the QSI professionals who will render services to
the Committee are:
Michael Starkey $280
August Ankum, Ph.D. $280
Warren Fischer, CPA $250
James Webber $250
Support $125 - $180
If a QSI professional is required to appear or testify before this
Court or other forum, the rates above will be increased by 20
percent for all time spent testifying and preparing to testify.
Non-working travel time will be billed at one-half the normal
hourly rate.
To the best of the Committee's knowledge, QSI Consulting is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
About UPH Holdings Inc.
UPH Holdings Inc. and several affiliates filed Chapter 11
petitions (Bankr. W.D. Tex. Lead Case No. 13-bk-10570) on
March 28, 2013. Judge Tony M. Davis oversees the case. Jennifer
Francine Wertz, Esq., and Patricia Baron Tomasco, Esq., at Jackson
Walker, L.L.P., serve as the Debtors' counsel. Q Advisors, LLC
serves as financial advisors. UPH Holdings disclosed $26,917,341
in assets and $19,705,805 in liabilities as of the Chapter 11
filing.
Other affiliates that sought Chapter 11 protection are: Pac-West
Telecomm, Inc.; Tex-Link Communications, Inc.; Unipoint Holdings,
Inc.; Unipoint Enhanced Services, Inc.; Unipoint Services, Inc.;
Nwire LLC; and Peering Partners Communications LLC (Case Nos.
13-10571 to 13-10577).
Judy A. Robbins, the United States Trustee for Region 7, has
appointed a five-member Official Committee of Unsecured Creditors
in the Chapter 11 cases of UPH Holdings, Inc., Pac-West Telecomm
Inc., and their affiliated debtors.
The Committee tapped Kelley Drye & Warren LLP as its counsel, and
QSI Consulting, Inc. as its financial advisor.
UPH HOLDINGS: Authorized to Sell Assets to TNCI Operating
---------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Texas has
authorized UPH Holdings, Inc., et al., to:
1. sell substantially all of its assets to TNCI Operating
Company, LLC pursuant to an asset purchase agreement dated
July 3, 2013; and
2. pay the net proceeds of sale to Hercules Technology II, L.P.
The Debtors, with the assistance of it sales agent, Q Advisors,
LLC, having conducted a marketing process, in consultation with
the Official Committee of Unsecured Creditors and Hercules,
determined that TNCI has submitted the highest and best bid for
property of the Debtor.
The Court on June 28, 2013, approved bid procedures with respect
to the sale of substantially all of the Debtors' assets. Pursuant
to the approved bid procedures, the auction, was scheduled for
July 9 until July 11, at the offices of Jackson Walker, L.L.P., in
Austin, Texas.
The Debtors' secured lender, Hercules Technology II. L.P., was
authorized, in its discretion, to credit bid at the auction all or
any portion of the Hercules Prepetition Indebtedness under Section
363(k) of the Bankruptcy Code.
About UPH Holdings Inc.
UPH Holdings Inc. and several affiliates filed Chapter 11
petitions (Bankr. W.D. Tex. Lead Case No. 13-bk-10570) on
March 28, 2013. Judge Tony M. Davis oversees the case. Jennifer
Francine Wertz, Esq., and Patricia Baron Tomasco, Esq., at Jackson
Walker, L.L.P., serve as the Debtors' counsel. Q Advisors, LLC
serves as financial advisors. UPH Holdings disclosed $26,917,341
in assets and $19,705,805 in liabilities as of the Chapter 11
filing.
Other affiliates that sought Chapter 11 protection are: Pac-West
Telecomm, Inc.; Tex-Link Communications, Inc.; Unipoint Holdings,
Inc.; Unipoint Enhanced Services, Inc.; Unipoint Services, Inc.;
Nwire LLC; and Peering Partners Communications LLC (Case Nos.
13-10571 to 13-10577).
Judy A. Robbins, the United States Trustee for Region 7, has
appointed a five-member Official Committee of Unsecured Creditors
in the Chapter 11 cases of UPH Holdings, Inc., Pac-West Telecomm
Inc., and their affiliated debtors.
The Committee tapped Kelley Drye & Warren LLP as its counsel, and
QSI Consulting, Inc. as its financial advisor.
UPH HOLDINGS: Wants Until Sept. 23 to File Chapter 11 Plan
----------------------------------------------------------
UPH Holdings, Inc., et al., ask the U.S. Bankruptcy Court for the
Western District of Texas to extend their exclusive period to file
a plan of reorganization until Sept. 23, 2013, and solicit
acceptances of that Plan until Nov. 22.
The Debtors explain they need additional time to implement bidding
and sales related procedures. The Debtors add that their estates
are best served by permitting them with time to focus on
maximizing returns from the sale of their assets.
About UPH Holdings Inc.
UPH Holdings Inc. and several affiliates filed Chapter 11
petitions (Bankr. W.D. Tex. Lead Case No. 13-bk-10570) on
March 28, 2013. Judge Tony M. Davis oversees the case. Jennifer
Francine Wertz, Esq., and Patricia Baron Tomasco, Esq., at Jackson
Walker, L.L.P., serve as the Debtors' counsel. Q Advisors, LLC
serves as financial advisors. UPH Holdings disclosed $26,917,341
in assets and $19,705,805 in liabilities as of the Chapter 11
filing.
Other affiliates that sought Chapter 11 protection are: Pac-West
Telecomm, Inc.; Tex-Link Communications, Inc.; Unipoint Holdings,
Inc.; Unipoint Enhanced Services, Inc.; Unipoint Services, Inc.;
Nwire LLC; and Peering Partners Communications LLC (Case Nos.
13-10571 to 13-10577).
Judy A. Robbins, the United States Trustee for Region 7, has
appointed a five-member Official Committee of Unsecured Creditors
in the Chapter 11 cases of UPH Holdings, Inc., Pac-West Telecomm
Inc., and their affiliated debtors.
The Committee tapped Kelley Drye & Warren LLP as its counsel, and
QSI Consulting, Inc. as its financial advisor.
USA BROADMOOR: Sept. 4 Hearing on Final Approval of Plan Outline
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida will
convene a hearing on Sept. 4, 2013, at 10 a.m., to consider final
approval of the Disclosure Statement explaining USA Broadmoor,
LLC's Plan of Reorganization. Objections, if any, are due seven
days before the date of the confirmation hearing.
On July 19, the Court conditionally approved the Disclosure
Statement.
As reported in the Troubled Company Reporter on July 26, 2013, the
Plan contemplates the continued operation of the Debtor. The Plan
provides for the classification and treatment of claims against
and interest in the Debtor. Claim 1 Priority Claims will be
paid in full. Claim 2 Wells Fargo Secured Claim will have a
$12 million unpaid principal balance of the Note on the Plan
Effective Date. Interest will accrue on the Principal Balance
outstanding at the rate of 175 basis points of the 10-year
treasury rate until the earlier of four years after the Plan
Effective Date.
As to Claim 3 Guardian Secured Claim, Class 4 Challenger Pools
Secured Claim, Claim 5 All Saints Secured Claim, and Class 6
Superior Seal Secured Claim, the Debtor will make installment
payments for 48 months. As to Class 7 Other Secured Claims, the
Debtor will surrender to all Class 7 Claimholders all Collateral
securing all Class 7 Claims in full satisfaction of those Claims.
The Reorganized Debtor will pay, on four successive years, 10% of
Allowed Class 8 Unsecured Claims. It will pay the balance of the
Allowed Class 8 Claims by the Maturity Date. Holders of Allowed
Class 9 Membership Interests will retain their Membership
Interests.
A copy of the Disclosure Statement dated July 9, 2013 is available
for free at http://bankrupt.com/misc/USABROADMOOR_DSJul9.pdf
Hugh L. Caraway, Jr., chief executive officer, signed the Plan.
About USA Broadmoor
USA Broadmoor, LLC, filed a Chapter 11 petition (Bankr. M.D. Fla.
Case No. 13-04880) on April 16, 2013. The petition was signed by
Hugh L. Caraway, chief executive officer of Internacional Realty,
Inc., member. The Debtor estimated assets and debts of at least
$10 million, respectively. Judge Michael G. Williamson presides
over the case. The Debtor is represented by Scott A. Stichter,
Esq., at Stichter, Riedel, Blain & Prosser, P.A., as counsel.
The Debtor disclosed $11,117,091 in assets and $11,121,374 in
liabilities as of the Chapter 11 filing.
USA BROADMOOR: Can Access Cash Collateral Until Oct. 31
-------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida has
authorized, on a final basis:
1. USA Broadmoor, LLC's continued access to cash collateral
until Oct. 31, 2013;
2. the property management agreement and payment to
Internacional Realty Management, LLC effective as of the
Petition Date.
As reported in the Troubled Company Reporter on July 18, 2013, the
Court authorized the use of cash collateral which creditor Wells
Fargo Bank Minnesota NA asserts an interest.
The Debtor is authorized to use proceeds generated by the lease or
rental of apartments units (cash collateral) to pay operating
expenses so long as any individual expense category does not
exceed the amount in the budget by more that 15 percent in any
month, provided that the Debtor may not exceed the entire amount
for any month in the budget.
The Debtor will not be authorized to pay any management fees
absent further Court order.
Wells Fargo serves as trustee for the Registered Holders of GMAC
Commercial Mortgage Securities Inc., Mortgage Pass-Through
Certificates, series 2002-c3, by and through its special servicer
CWCapital Asset Management LLC.
As adequate protection from any diminution in value of the
lender's collateral, the Trust is granted a replacement lien
against the Debtor's cash collateral to the same extent, validity,
and priority as existed as of the Petition Date.
About USA Broadmoor
USA Broadmoor, LLC, filed a Chapter 11 petition (Bankr. M.D. Fla.
Case No. 13-04880) on April 16, 2013. The petition was signed by
Hugh L. Caraway, chief executive officer of Internacional Realty,
Inc., member. The Debtor estimated assets and debts of at least
$10 million, respectively. Judge Michael G. Williamson presides
over the case. The Debtor is represented by Scott A. Stichter,
Esq., at Stichter, Riedel, Blain & Prosser, P.A., as counsel.
The Debtor disclosed $11,117,091 in assets and $11,121,374 in
liabilities as of the Chapter 11 filing.
The Plan filed by the Debtors contemplates their continued
operation. The Plan provides for the classification and treatment
of claims against and interest in the Debtor. Claim 1 Priority
Claims will be paid in full. Claim 2 Wells Fargo Secured Claim
will have a $12 million unpaid principal balance of the Note on
the Plan Effective Date. Interest will accrue on the Principal
Balance outstanding at the rate of 175 basis points of the 10-year
treasury rate until the earlier of four years after the Plan
Effective Date.
As to Claim 3 Guardian Secured Claim, Class 4 Challenger Pools
Secured Claim, Claim 5 All Saints Secured Claim, and Class 6
Superior Seal Secured Claim, the Debtor will make installment
payments for 48 months. As to Class 7 Other Secured Claims, the
Debtor will surrender to all Class 7 Claimholders all Collateral
securing all Class 7 Claims in full satisfaction of those Claims.
Under the Plan, the Reorganized Debtor will pay, on four
successive years, 10 percent of Allowed Class 8 Unsecured Claims.
It will pay the balance of the Allowed Class 8 Claims by the
Maturity Date. Holders of Allowed Class 9 Membership Interests
will retain their Membership Interests.
USEC INC: Noble Group Equity Stake Down to 2% at July 31
--------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Noble Group Limited disclosed that as of
July 31, 2013, it beneficially owned 118,957 shares of common
stock of USEC Inc. representing 2.4 percent of the shares
outstanding. On July 31, 2013, Noble Group disposed of 115,000
shares. As a result of these transactions, as of July 31, 2013,
Noble Group beneficially owns less than 5 percent of the shares.
A copy of the regulatory filing is available at:
http://is.gd/c2bbxz
About USEC Inc.
Headquartered in Bethesda, Maryland, USEC Inc. (NYSE: USU) --
http://www.usec.com/-- supplies enriched uranium fuel for
commercial nuclear power plants.
USEC disclosed a net loss of $1.20 billion in 2012, as compared
with a net loss of $491.1 million in 2011. The Company's balance
sheet at March 31, 2013, showed $1.52 billion in total assets,
$1.99 billion in total liabilities, and a $469.6 million
stockholders' deficit.
PricewaterhouseCoopers LLP, in McLean, Virginia, 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 reported net losses and a stockholders'
deficit at Dec. 31, 2012, and is engaged with its advisors and
certain stakeholders on alternatives for a possible restructuring
of its balance sheet, which raise substantial doubt about its
ability to continue as a going concern.
Bankruptcy Warning
"A delisting of our common stock by the NYSE and the failure of
our common stock to be listed on another national exchange could
have significant adverse consequences. A delisting would likely
have a negative effect on the price of our common stock and would
impair stockholders' ability to sell or purchase our common stock.
As of December 31, 2012, we had $530 million of convertible notes
outstanding. A 'fundamental change' is triggered under the terms
of our convertible notes if our shares of common stock are not
listed for trading on any of the NYSE, the American Stock
Exchange, the NASDAQ Global Market or the NASDAQ Global Select
Market. Our receipt of a NYSE continued listing standards
notification described above did not trigger a fundamental change.
If a fundamental change occurs under the convertible notes, the
holders of the notes can require us to repurchase the notes in
full for cash. We do not have adequate cash to repurchase the
notes. In addition, the occurrence of a fundamental change under
the convertible notes that permits the holders of the convertible
notes to require a repurchase for cash is an event of default
under our credit facility. Accordingly, the exercise of remedies
by holders of our convertible notes or lenders under our credit
facility as a result of a delisting would have a material adverse
effect on our liquidity and financial condition and could require
us to file for bankruptcy protection," according to the Company's
annual report for the year ended Dec. 31, 2012.
* * *
USEC Inc. carries 'Caa1' corporate and probability of default
ratings, with "developing" outlook, from Moody's.
As reported by the TCR on Aug. 17, 2012, Standard & Poor's Ratings
Services lowered its ratings on USEC Inc., including the corporate
credit rating to 'CCC' from 'CCC+'.
"The downgrade reflects our assessment of USEC's long-term
viability after the company publicly stated that it will be
difficult to continue enrichment operations at the Paducah Gaseous
Diffusion Plant after a one-year multiparty agreement to extend
operations expires in May 2013," said Standard & Poor's credit
analyst Maurice S. Austin.
VALLEY TIMBERS: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Valley Timbers LC
Suite 152 C
8421 South Walker
Oklahoma City, OK 73139
Bankruptcy Case No.: 13-13473
Chapter 11 Petition Date: July 31, 2013
Court: United States Bankruptcy Court
Western District of Oklahoma (Oklahoma City)
Judge: Niles L. Jackson
Debtor's Counsel: L. Win Holbrook, Esq.
ANDREWS DAVIS
100 North Broadway Suite 3300
Oklahoma City, OK 73102
Tel: (405) 272-9241
E-mail: wholbrook@andrewsdavis.com
Scheduled Assets: $2,246,072
Scheduled Liabilities: $57,430,186
A copy of the Company's list of its 20 largest unsecured
creditors, filed together with the petition, is available for free
at http://bankrupt.com/misc/okwb13-13473.pdf
The petition was signed by James G. Waldrup, III, manager.
VELATEL GLOBAL: Files Arbitration Proceeding vs. China Motion
-------------------------------------------------------------
VelaTel Global Communications, Inc., together with its wholly
owned subsidiary Gulfstream Capital Partners, Ltd., commenced an
arbitration proceeding against China Motion Telecom International
Limited, China Motion Holdings Limited, and ChinaMotion
InfoServices Limited by filing a Notice of Arbitration with the
Hong Kong International Arbitration Centre. The Arbitration
relates to the stock purchase agreement and related transaction
documents between the Company and the Respondents for the
Company's acquisition of 100 percent of the capital stock of China
Motion Telecom (HK) Limited.
In the notice of arbitration, the Company alleges that Respondents
have breached the SPA by interfering in the day-to-day management
of CMTHK in various ways that exceed the limited oversight granted
to Respondents pursuant to the terms of the SPA, including but not
limited to: (a) delaying CMTHK's processing of the Company's
invoices for technical services rendered to CMTHK, and (b)
refusing to authorize CMTHK to process banking board resolutions
approved by a majority of CMTHK's directors to change signatory
authority on CMTHK's bank accounts.
The Company seeks the following relief in the Arbitration:
(1) declaring Respondents have breached the SPA;
(2) enjoining Respondents from future interference in the
management of CMTHK; and
(3) for recovery of the Company's past and future damages
caused by Respondents' breach of the SPA.
Pursuant to the Arbitration rules to which the Company and the
Respondents agreed in the SPA, there are limitations on the right
to publish or disclose any information regarding the Arbitration
absent consent of all parties to the Arbitration. On Aug. 1,
2013, the Company and Respondents mutually consented to disclosure
of current or future information regarding the Arbitration that a
party deems required or advisable in connection with its
obligations as a company with publicly traded securities.
The Arbitration has just commenced and Respondents have not yet
filed their response to the Notice of Arbitration.
About VelaTel Global
VelaTel acquires spectrum assets through acquisition or joint
venture relationships, and provides capital, engineering,
architectural and construction services related to the build-out
of wireless broadband telecommunications networks, which it then
operates by offering services attractive to residential,
enterprise and government subscribers. VelaTel currently focuses
on emerging markets where internet penetration rate is low
relative to the capacity of incumbent operators to provide
comparable cutting edge services, or where the entry cost to
acquire spectrum is low relative to projected subscribers.
VelaTel currently has project operations in People's Republic of
China, Croatia, Montenegro and Peru. Additional target markets
include countries in Latin America, the Caribbean, Southeast Asia
and Eastern Europe. VelaTel's administrative headquarters are in
Carlsbad, California. See http://www.velatel.com/
Velatel Global incurred a net loss of $45.60 million on $1.87
million of revenue for the year ended Dec. 31, 2012, as compared
with a net loss of $21.79 million on $0 of revenue for the year
ended Dec. 31, 2011. As of March 31, 2013, the Company had $15.77
million in total assets, $62.25 million in total liabilities and a
$46.48 million total deficiency.
Kabani & Company, Inc., in Los Angeles, California, issued a
"going concern" qualification on the consolidated financial
statements for the year ended Dec. 31, 2012. The independent
auditors noted that the Company's viability is dependent upon its
ability to obtain future financing and the success of its future
operations. The Company has incurred a net loss of $45,601,292
for the year ended Dec. 31, 2012, cumulative losses of
$298,347,524 since inception, a negative working capital of
$34,972,850 and a stockholders' deficiency of $36,566,868. These
factors raise substantial doubt as to the Company's ability to
continue as a going concern.
VUZIX CORP: Underwriters Exercise Over-Allotment Option
-------------------------------------------------------
Vuzix Corporation announced the full exercise of the over-
allotment option granted to the underwriters to purchase an
additional 525,000 shares of its common stock and warrants to
purchase up to an aggregate of 525,000 shares of common stock, at
a public offering price of $2.00 per share and $0.0001 per
warrant, respectively, in connection with its previously announced
underwritten initial public offering of 3,500,000 shares of common
stock, and warrants to purchase up to an aggregate of 3,500,000
shares of common stock, bringing expected total gross proceeds
from the offering to approximately $8,050,000, before underwriting
discounts and commissions and other offering expenses payable by
Vuzix. The warrants have a per share exercise price of $2.25, are
exercisable immediately, and expire five years from the date of
issuance.
Aegis Capital Corp. is acting as sole book-running manager for the
offering.
Chardan Capital Markets is acting as a financial advisor for the
offering.
This offering is being made only by means of a prospectus. Copies
of the prospectus relating to this offering may be obtained by
contacting Aegis Capital Corp., Prospectus Department, 810 Seventh
Avenue, 18th Floor, New York, NY 10019, telephone: 212-813-1010,
e-mail: prospectus@aegiscap.com
About Vuzix Corp.
Rochester, New York-based Vuzix Corporation (TSX-V: VZX)
OTC BB: VUZI) -- http://www.vuzix.com/-- is a supplier of Video
Eyewear products in the defense, consumer and media &
entertainment markets.
Vuzix reported net income of $322,840 for the year ended Dec. 31,
2012, as compared with a net loss of $3.87 million during the
prior year. The Company's balance sheet at March 31, 2013, showed
$3.08 million in total assets, $10.14 million in total liabilities
and a $7.05 million total stockholders' deficit.
EFP Rotenberg, LLP, in Rochester, 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 substantial losses from operations
in recent years. In addition, the Company is dependent on its
various debt and compensation agreements to fund its working
capital needs. The Company was not in compliance with its
financial covenants under a senior secured debt holder and had
other debts past due in some cases. These conditions raise
substantial doubt about its ability to continue as a going
concern.
Bankruptcy Warning
"We have engaged an investment banking firm to assist us with
respect to a planned public stock offering of up to $15,000,000.
Our future viability is dependent on our ability to execute these
plans successfully. If we fail to do so for any reason, we would
not have adequate liquidity to fund our operations, would not be
able to continue as a going concern and could be forced to seek
relief through a filing under U.S. Bankruptcy Code," the Company
said in its annual report for the year ended Dec. 31, 2012.
VUZIX CORP: Selling 3.5 Million Common Shares at $2 Apiece
----------------------------------------------------------
Vuzix Corporation has priced its public offering of 3,500,000
shares of common stock, and warrants to purchase up to an
aggregate of 3,500,000 shares of common stock, at $2.00 per share
and $0.0001 per warrant. The warrants have a per share exercise
price of $2.25, are exercisable immediately, and expire five years
from the date of issuance.
The gross proceeds to Vuzix from the offering are expected to be
approximately $7,000,000 before underwriting discounts and
commissions and other offering expenses. All of the shares and
warrants in the offering are being sold by the Company.
The Company intends to use the net proceeds received from the
offering to complete commercialization of the M100 Smart Glasses,
winner of the Best of Innovations and Engineering award at the
2013 Consumer Electronics Show (CES), and the VFX720 video head
phone products, and waveguide technologies, repayment of certain
of debt (consisting of principal and interest on outstanding
notes, convertible debentures and bank loans) in the amount of
approximately $2,025,000 , and for working capital and general
corporate purposes.
The Company has granted the representative of the underwriters a
45-day option to purchase up to 525,000 additional common shares
from Vuzix or 525,000 additional warrants to cover over-
allotments, if any. The offering is expected to close on Aug. 5,
2013, subject to customary closing conditions.
Aegis Capital Corp. is acting as sole book-running manager for the
offering.
Chardan Capital Markets is acting as a financial advisor for the
offering.
In connection with the closing of the offering, the Company
anticipates that its common stock may be suspended from trading on
the TSX Venture Exchange, and that it may be delisted thereafter,
as a result of the common stock being sold at a greater than 20
percent discount to the current market price.
About Vuzix Corp.
Rochester, New York-based Vuzix Corporation (TSX-V: VZX)
OTC BB: VUZI) -- http://www.vuzix.com/-- is a supplier of Video
Eyewear products in the defense, consumer and media &
entertainment markets.
Vuzix reported net income of $322,840 for the year ended Dec. 31,
2012, as compared with a net loss of $3.87 million during the
prior year. The Company's balance sheet at March 31, 2013, showed
$3.08 million in total assets, $10.14 million in total liabilities
and a $7.05 million total stockholders' deficit.
EFP Rotenberg, LLP, in Rochester, 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 substantial losses from operations
in recent years. In addition, the Company is dependent on its
various debt and compensation agreements to fund its working
capital needs. The Company was not in compliance with its
financial covenants under a senior secured debt holder and had
other debts past due in some cases. These conditions raise
substantial doubt about its ability to continue as a going
concern.
Bankruptcy Warning
"We have engaged an investment banking firm to assist us with
respect to a planned public stock offering of up to $15,000,000.
Our future viability is dependent on our ability to execute these
plans successfully. If we fail to do so for any reason, we would
not have adequate liquidity to fund our operations, would not be
able to continue as a going concern and could be forced to seek
relief through a filing under U.S. Bankruptcy Code," the Company
said in its annual report for the year ended Dec. 31, 2012.
W.R. GRACE: Expects Appeals Court Ruling After Labor Day
--------------------------------------------------------
Peg Brickley writing for Dow Jones' DBR Small Cap reports that a
crucial federal appeals court ruling that could finally clear the
way for W.R. Grace & Co. to end its long stay in bankruptcy is
expected "sometime shortly following Labor Day," a lawyer for the
chemical company told a judge Thursday.
About W.R. Grace
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally.
The company and its debtor-affiliates filed for chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura
Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP,
represent the Debtors in their restructuring efforts. The Debtors
hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.
Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent
the Official Committee of Unsecured Creditors. The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice.
Roger Frankel serves as legal representative for victims of
asbestos exposure who may file claims against W.R. Grace. Mr.
Frankel, a partner at Orrick Herrington & Sutcliffe LLP, replaces
David Austern, who was appointed to that role in 2004. Mr.
Frankel has served as legal counsel for Mr. Austern who passed
away in May 2013.
Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA.
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla
R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official
Committee of Asbestos Personal Injury Claimants. The Asbestos
Committee of Property Damage Claimants tapped Scott Baena, Esq.,
and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod,
LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel, LLP, represents the Official Committee of
Equity Security Holders.
W.R. Grace obtained confirmation of a plan co-proposed with the
Official Committee of Asbestos Personal Injury Claimants, the
Official Committee of Equity Security Holders, and the Asbestos
Future Claimants Representative. The Chapter 11 plan is built
around an April 2008 settlement for all present and future
asbestos personal injury claims, and a subsequent settlement for
asbestos property damage claims. Implementation of the Plan has
been held up by appeals in District Court from various parties,
including a group of prepetition bank lenders and the Official
Committee of Unsecured Creditors.
District Judge Ronald Buckwalter on Jan. 31, 2012, entered an
order affirming the bankruptcy court's confirmation of the Plan.
Bankruptcy Judge Judith Fitzgerald had approved the Plan on
Jan. 31, 2011.
The plan can't be implemented because pre-bankruptcy secured bank
lenders filed an appeal currently pending in the U.S. Court of
Appeals in Philadelphia.
Bankruptcy Creditors' Service, Inc., publishes W.R. Grace
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000).
WEST COAST METAL: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: West Coast Metal Roofing and Construction LLC
5689 Industrial Blvd.
Milton, FL 32583
Bankruptcy Case No.: 13-30970
Chapter 11 Petition Date: July 31, 2013
Court: United States Bankruptcy Court
Northern District of Florida (Pensacola)
Judge: William S. Shulman
Debtor's Counsel: Robert R. McDaniel, II, Esq.
MCDANIEL & ELLIS, P.A.
103 N. DeVilliers Street
Pensacola, FL 32502
Tel: (850) 432-5111
Fax: (850) 432-5112
E-mail: mcdanielandellis@gmail.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: 1,000,001 to $10,000,000
A copy of the Company's list of its 20 largest unsecured creditors
is available for free at http://bankrupt.com/misc/flnb13-30970.pdf
The petition was signed by John Myslak, member/manager.
WEST CORP: Reports $43.6 Million Net Income in Second Quarter
-------------------------------------------------------------
West Corporation reported net income of $43.66 million on $672.69
million of revenue for the three months ended June 30, 2013, as
compared with net income of $36.69 million on $661.89 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 $46.72 million on $1.33 billion of revenue, as compared
with net income of $70.73 million on $1.30 billion of revenue for
the same period a year ago.
As of June 30, 2013, the Company had $3.46 billion in total
assets, $4.28 billion in total liabilities and a $819.47 million
stockholders' deficit.
"We are pleased to report another quarter of solid operating
results. Debt reduction and lower interest rates on our term debt
combined with improvement in SG&A to fuel improved profitability
for the quarter," said Tom Barker, CEO. "We continue to execute
on our strategic initiatives, while returning a portion of our
earnings to our shareholders through our quarterly dividend."
The Company also announced a $0.225 per common share quarterly
dividend. The dividend is payable Aug. 22, 2013, to shareholders
of record as of the close of business on Aug. 12, 2013.
A copy of the press release is available for free at:
http://is.gd/WfFGNN
About West Corporation
Founded in 1986 and headquartered in Omaha, Nebraska, West
Corporation -- http://www.west.com/-- provides outsourced
communication solutions to many of the world's largest companies,
organizations and government agencies. West Corporation has a
team of 41,000 employees based in North America, Europe and Asia.
West Corporation reported net income of $125.54 million in 2012,
net income of $127.49 million in 2011, and net income of $60.30
million in 2010.
Bankruptcy Warning
"At March 31, 2013, our aggregate long-term indebtedness,
including the current portion, was $4,057.6 million. During the
three months ended March 31, 2013 our consolidated interest
expense was approximately $72.9 million. Our ability to make
scheduled payments or to refinance our debt obligations and to
fund our other liquidity needs depends on our financial and
operating performance, which is subject to prevailing economic and
competitive conditions and to certain financial, business and
other factors beyond our control. We cannot make assurances that
we will maintain a level of cash flows from operating activities
sufficient to permit us to pay the principal, premium, if any, and
interest on our indebtedness and to fund our other liquidity
needs. If our cash flows and capital resources are insufficient
to fund our debt service obligations and to fund our other
liquidity needs, we may be forced to reduce or delay capital
expenditures or declared dividends, sell assets or operations,
seek additional capital or restructure or refinance our
indebtedness. We cannot make assurances that we would be able to
take any of these actions, that these actions would be successful
and permit us to meet our scheduled debt service obligations or
that these actions would be permitted under the terms of our
existing or future debt agreements, including our senior secured
credit facilities or the indentures that govern our outstanding
notes. Our senior secured credit facilities documentation and the
indentures that govern the notes restrict our ability to dispose
of assets and use the proceeds from the disposition. As a result,
we may not be able to consummate those dispositions or use the
proceeds to meet our debt service or other obligations, and any
proceeds that are available may not be adequate to meet any debt
service or other obligations then due. If we cannot make
scheduled payments on our debt, we will be in default of such debt
and, as a result:
* our debt holders could declare all outstanding principal and
interest to be due and payable;
* our debt holders under other debt subject to cross default
provisions could declare all outstanding principal and
interest on such other debt to be due and payable;
* the lenders under our senior secured credit facilities could
terminate their commitments to lend us money and foreclose
against the assets securing our borrowings; and
* we could be forced into bankruptcy or liquidation," according
to the Company's quarterly report for the period ended
March 31, 2013.
* * *
West Corp. carries a 'B2' corporate rating from Moody's and 'B+'
corporate rating from Standard & Poor's.
Moody's Investors Service upgraded the ratings on West
Corporation's existing senior secured term loan to Ba3 from B1 and
the rating on $650 million of existing senior notes due 2014 to B3
from Caa1 upon the closing of its recent refinancing transactions.
Concurrently, Moody's affirmed all other credit ratings including
the B2 Corporate Family Rating and B2 Probability of Default
Rating. The rating outlook is stable.
As reported by the TCR on June 21, 2013, Standard & Poor's Ratings
Services raised its corporate credit rating on Omaha, Neb.-based
business process outsourcer West Corp. to 'BB-' from 'B+' and
removed it from CreditWatch, where S&P placed the rating with
positive implications on March 19, 2013, following the company's
announcement that it was raising about $500 million through an
initial public offering to repay debt.
WESTINGHOUSE SOLAR: Incurs $555,000 Net Loss in Second Quarter
--------------------------------------------------------------
Westinghouse Solar, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
a net loss attributable to common stockholders of $555,115 on
$130,046 of net revenue for the three months ended June 30, 2013,
as compared with a net loss attributable to common stockholders of
$2.21 million on $1.21 million of net revenue for the same period
during the prior year.
For the six months ended June 30, 2013, the Company incurred a net
loss attributable to common stockholders of $1.89 million on
$211,240 of net revenue, as compared with a net loss attributable
to common stockholders of $5.09 million on $3.63 million of net
revenue for the same period a year ago.
Westinghouse Solar disclosed a net loss of $8.62 million on
$5.22 million of net revenue in 2012, as compared with a net loss
of $4.63 million on $11.42 million of net revenue in 2011.
As of June 30, 2013, the Company had $3.04 million in total
assets, $5.30 million in total liabilities, $247,761 in series C
convertible redeemable preferred stock, $545,000 in series D
convertible redeemable preferred stock, and a $3.05 million total
stockholders' deficit.
A copy of the Form 10-Q is available for free at:
http://is.gd/9PSr0F
About Westinghouse
Campbell, Cal.-based Westinghouse Solar, Inc., is a designer and
manufacturer of solar power systems and solar panels with
integrated microinverters. The Company designs, markets and sells
these solar power systems to solar installers, trade workers and
do-it-yourself customers in the United States and Canada through
distribution partnerships, the Company's dealer network and retail
outlets.
Burr Pilger Mayer, Inc., in San Francisco, California, issued a
"going concern" qualification on the consolidated financial
statements for the year ended Dec. 31, 2012, citing significant
operating losses and negative cash flow from operations that raise
substantial doubt about its ability to continue as a going
concern.
WESTMORELAND COAL: Lowers Net Loss to $622,000 in 2nd Quarter
-------------------------------------------------------------
Westmoreland Coal Company reported a net loss applicable to common
shareholders of $622,000 on $162.49 million of revenues for the
three months ended June 30, 2013, as compared with a net loss
applicable to common shareholders of $12.42 million on $132.84
million of revenues for the same period during the prior year.
For the six months ended June 30, 2013, the Company incurred a net
loss attributable to common shareholders of $3.34 million on
$323.94 million of revenues, as compared with a net loss
attributable to common shareholders of $11.90 million on $280.07
million of revenues for the same period a year ago.
"During the second quarter, favorable weather and low hydro
generation resulted in high demand for power. Our customers ran
their plants at high levels and Westmoreland's mines and plants
operated very well, producing $32 million in EBITDA for the
quarter. Second quarter EBITDA has historically been lower than
other quarters, and we are extremely pleased with these results,"
said Robert P. King, Westmoreland's chief executive officer.
"During the quarter, we also continued to successfully execute our
delevering strategy, driving our net leverage ratio below 2.5."
A copy of the press release is available for free at:
http://is.gd/uJ1wJb
About Westmoreland Coal
Colorado Springs, Colo.-based Westmoreland Coal Company (NYSE
AMEX: WLB) -- http://www.westmoreland.com/-- is the oldest
independent coal company in the United States. The Company's coal
operations include coal mining in the Powder River Basin in
Montana and lignite mining operations in Montana, North Dakota and
Texas. Its power operations include ownership of the two-unit
ROVA coal-fired power plant in North Carolina.
Westmoreland Coal incurred a net loss of $13.66 million in 2012, a
net loss of $36.87 million in 2011, and a net loss of $3.17
million in 2010. The Company's balance sheet at March 31, 2013,
showed $943.01 million in total assets, $1.22 billion in total
liabilities and a $286.53 million total deficit.
* * *
As reported by the TCR on Nov. 6, 2012, Standard & Poor's
Ratings Services raised its corporate credit rating on Englewood,
Co.-based Westmoreland Coal Co. (WLB). to 'B-' from 'CCC+'.
"The upgrade reflects our view that WLB is less vulnerable to
default after successfully negotiating less restrictive covenant
requirements for an unrated $110 million term loan due 2018," said
credit analyst Gayle Bowerman. "Our assessment of WLB's business
risk profile as 'vulnerable' and financial risk profile as 'highly
leveraged' are unchanged. We also revised our liquidity score to
'adequate' based on the covenant relief and additional liquidity
provided under the company's new $20 million asset-based loan
(ABL) facility from 'less than adequate'."
Westmoreland Coal carries a Caa1 corporate family rating from
Moody's Investors Service.
WJO INC: Ch.11 Trustee Wants Co-Counsel on SWIF, MedRisk Matters
----------------------------------------------------------------
Alfred T. Guiliano, Chapter 11 Trustee for WJO Inc., asks the
Bankruptcy Court for authorization to expand the scope of
employment of the law office of James J. Hollawell, P.C. and Veith
Law Firm as special co-counsel.
As reported in the Troubled Company Reporter on Oct. 8, 2012,
the Court authorized the Chapter 11 trustee to employ the Law
Office of James J. Hollawell, P.C. and Veith Law Firm as special
co-counsel.
As reported in the TCR on Sept. 14, 2012, the Chapter 11 trustee
related that in connection with the Petitions filed at the
Commonwealth of Pennsylvania, Bureau of Workers' Compensation,
against certain workers' compensation patients' employers and
their workers compensation insurance carriers, the trustee
proposed to pay Hollawell on a contingency basis of 25% of any
recovery plus costs.
Hallowell and Veith are expected to continue with the seven
current appeals, and to prosecute and defend future appeals and
petitions for supersedes.
The Chapter 11 trustee, in its motion, states that since the
employment, the special co-counsel has successfully litigated
numerous case and significant funds have come into the bankruptcy
estate as a result of their efforts.
The Chapter 11 trustee relates that in connection with certain
litigation against the State Workers' Insurance Fund and MedRisk,
special co-counsel discovered potential fraudulent conduct by SWIF
and MedRisk concerning their efforts to avoid payment of medical
bill reimbursements or penalties for improper downcoding pursuant
to the Medical Cost Containments Regulations and case law.
In this connection, the special co-counsel requested that the
trustee expand their engagement in order for them to investigate
SWIF and MedRisk to potentially pursue an action against them for
fraud, bad faith and other claims.
The parties have agreed to bifurcate the matter into two phases.
The scope of representation covering the first phase of the matter
is encompassed within the fee agreement calling for a retainer in
the aggregate amount of $30,000.
The professional legal services of the firms will be capped at
$50,000 pursuant to these rates:
Attorneys $400/hour
Paralegals $100/hour
About WJO Inc.
Bristol, Pennsylvania-based WJO, Inc., operates six family
practices located in Newtown, Bristol, Bensalem, Bustleton, South
Philadelphia, and Bethlehem, Pennsylvania and consists of Board
Certified Osteopathic Physicians specializing in Family Medicine.
Prior to the petition date, and to allow the Company to
restructure effectively, HyperOx Inc., HyperOx I, LP, HyperOx
III, LP, and East Coast TMR, Inc., were merged into WJO.
WJO filed for Chapter 11 bankruptcy protection (Bankr. E.D. Pa.
Case No. 10-19894) on Nov. 15, 2010. The Debtor disclosed
$19,923,802 in assets and $6,805,255 in liabilities as of the
Chapter 11 filing.
Holly Elizabeth Smith, Esq., and Thomas Daniel Bielli, Esq., at
Ciardi Ciardi & Astin, P.C., serve as the Debtor's bankruptcy
counsel. Pond Lehocky Stern Giordano serves as the Debtor's
special counsel to represent it in worker's compensation
proceedings pertaining to the Therapeutic Magnetic Resonance
treatments. Patrick Yun serves as the Debtor's financial advisor.
Attorneys at Keifer & Tsarouhis LLP serve as counsel to the
official committee of unsecured creditors. ParenteBeard LLC
serves as the Committee's accountant and financial advisor.
The United States Trustee has appointed David Knowlton as patient
care ombudsman in the case. The Ombudsman is represented in the
case by Karen Lee Turner, Esq., at Eckert Seamans Cherin &
Mellott, LLC, as counsel.
Tristate Capital Bank, the cash collateral lender, is represented
in the case by lawyers at Benesch Friedlander Coplan & Aronoff
LLP.
On July 3, 2012, Roberta A. DeAngelis, U.S. Trustee for Region 3,
obtained permission from the Hon. Jean K. Fitzsimon of the U.S.
Bankruptcy Court for the Eastern District of Pennsylvania to
appoint Alfred T. Giuliano as Chapter 11 trustee of the bankruptcy
estate of WJO, Inc. Maschmeyer Karalis P.C. serves as the Chapter
11 Trustee's general bankruptcy counsel.
WORLD IMPORTS: Files List of 20 Top Unsecured Creditors
-------------------------------------------------------
World Imports submitted to the Bankruptcy Court a list that
identifies its top 20 unsecured creditors.
Creditors with the three largest claims are:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Oec Freight INC. Trade $856,557
P.O. BOX 232910
2910 Momentum Place
Chicago IL 60689
Zhangzhou Weisheng Industrial Trade $433,345
Room 305
Bldg 49 Rongchang Garden
Yingbin Road Zhangzhou City
China
American Express
PO BOX 360001
FT. Lauderdale, FL 33336 Trade $95,119
A copy of the creditors' list is available for free at:
http://bankrupt.com/misc/WORLD_IMPORTS_creditorslist.pdf
World Imports filed a Chapter 11 petition (Bankr. E.D. Pa. Case
No. 13-15929) on July 3, 2013, in Philadelphia. John E. Kaskey,
Esq., at Braverman Kaskey, P.C., in Philadelphia, serves as
counsel. The Debtor estimated assets and debts of $10 million to
$50 million.
WORLD SURVEILLANCE: Inks Support Agreement with US Technik
----------------------------------------------------------
World Surveillance Group Inc. and it's wholly owned subsidiary,
Lighter Than Air Systems Corp. have entered into an agreement with
defense contractor US Technik, Inc., that makes it a sales
contractor for the Blimp in a BoxTM aerostat system and other LTAS
and WSGI products. Pursuant to the agreement, US Technik also is
to provide sales and services support by acting on WSGI's and
LTAS' behalf at marketing events, trade shows, and potential
customer presentations and meetings, providing demonstrations of
our products, and marketing our products in the U.S. and
internationally to, among others, the defense, homeland security
and first responder sectors. US Technik also has the right to
provide post contract field services support, operations support
and training to the Company's customers relating to all of WSGI's
and LTAS' products.
US Technik is a veteran owned, small business corporation
headquartered in Colorado Springs, Colorado, that works with
government and commercial organizations to find product solutions
and then to provide training and support related to such systems
in the U.S. and abroad. US Technik specializes in tactical
aerostat capabilities, but also provides technology services,
systems integration and managed services in addition to
operational support and training for various products.
LTAS and US Technik jointly worked on the LTAS tactical aerostat
systems operated by the U.S. Army's Space and Missile Defense
Command Battle Lab and worked with WSGI and LTAS by providing
training and operations support for the Blimp in a Box systems to
the U.S. Army. Subsequent to the operations and training on the
initial SMDC aerostat system, LTAS delivered a second complete
trailer-based launcher system along with two additional aerostats
to SMDC. LTAS has also received orders from SMDC for upgrades to
the two systems for a communications related payload system,
powered tether and various other components.
LTAS has also received several additional orders recently: the
first is for an aerostat and subsystem solution from Eglin Air
Force Base; and the second is for a land-based versatile
surveillance mast system from the Ventura County Public Health
Department - Emergency Medical Services.
WSGI President and CEO, Glenn D. Estrella, stated, "We look
forward to further developing the business relationship we have
with US Technik following our joint efforts with our Department of
Defense customers and expanding our sales pipeline for the BiB and
other products while also providing first class operations and
training support. It is exciting to see LTAS' continued sales
procurement and execution, especially the follow-on orders which
evidence customer satisfaction. We, along with LTAS, intend to
pursue our current pipeline of opportunities for both LTAS'
tactical aerostat systems and our ground-based mast surveillance
solutions in order to expand LTAS revenues and customer base."
Employment Agreement with CEO
The Company entered into an Amended and Restated Employment
Agreement with Glenn Estrella, president and chief executive
officer, providing for one-year renewal terms and annual salary of
$250,000 per year. Upon Mr. Estrella's termination of employment
without cause or for good reason, he is entitled to six months of
severance and health benefits. The Employment Agreement includes
one-year noncompetition and non-solicitation provisions as well as
confidentiality and inventions assignment provisions.
Annual Meeting Results
At the Annual Meeting of the holders of common stock of the
Company, the shareholders:
(1) elected Glenn D. Estrella and Anita S. Hulo as directors;
(2) approved the Amended and Restated Certificate of
Incorporation of the Company;
(3) approved the 2013 Equity Compensation Incentive Plan of the
Company;
(4) approved a nonbinding advisory resolution approving the
Company's executive compensation;
(5) approved a nonbinding advisory resolution establishing that
the advisory vote on the Company's executive compensation
would be held every year; and
(6) ratified the appointment of Rosen Seymour Shapss Martin &
Company LLP, as the Company's independent registered public
accounting firm.
Consistent with the stated preference of a majority of the
Company's stockholders, the Board of Directors has determined that
it will hold an annual advisory vote on the compensation of the
Company's named executive officers until the next required vote on
the frequency of stockholder votes on compensation of named
executive officers, which will occur no later than the Company's
annual meeting of stockholders in 2019.
Following the formal business of the 2013 Annual Meeting,
Mr. Estrella provided a management presentation, a copy of which
is available for free at http://is.gd/5PORkJ
About World Surveillance
World Surveillance Group Inc. designs, develops, markets and sells
autonomous lighter-than-air (LTA) unmanned aerial vehicles (UAVs)
capable of carrying payloads that provide persistent security
and/or wireless communication from air to ground solutions at low,
mid and high altitudes. The Company's airships, when integrated
with electronics systems and other high technology payloads, are
designed for use by government-related and commercial entities
that require real-time intelligence, surveillance and
reconnaissance or communications support for military, homeland
defense, border control, drug interdiction, natural disaster
relief and maritime missions. The Company is headquartered at the
Kennedy Space Center, in Florida.
World Surveillance disclosed a net loss of $3.36 million on
$272,201 of net revenues for the year ended Dec. 31, 2012, as
compared with a net loss of $1.12 million on $19,896 of net
revenues in 2011. The Company's balance sheet at March 31, 2013,
showed $3.89 million in total assets, $16.59 million in total
liabilities and a $12.69 million total stockholders' deficit.
Rosen Seymour Shapss Martin & Company 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 experienced significant losses
and negative cash flows, resulting in decreased capital and
increased accumulated deficits. These conditions raise
substantial doubt about its ability to continue as a going
concern.
Bankruptcy Warning
"Our indebtedness at March 31, 2013 was $16,591,883. A portion of
such indebtedness reflects judicial judgments against us that
could result in liens being placed on our bank accounts or assets.
We are continuing to review our ability to reduce this debt level
due to the age and/or settlement of certain payables but we may
not be able to do so. This level of indebtedness could, among
other things:
* make it difficult for us to make payments on this debt and
other obligations;
* make it difficult for us to obtain future financing;
* require us to redirect significant amounts of cash from
operations to servicing the debt;
* require us to take measures such as the reduction in scale of
our operations that might hurt our future performance in
order to satisfy our debt obligations; and
* make us more vulnerable to bankruptcy or an unwanted
acquisition on terms unsatisfactory to us," according to the
Company's Form 10-Q for the period ended March 31, 2013.
WPCS INTERNATIONAL: Issues 275,742 Common Shares
------------------------------------------------
WPCS International Incorporated issued an aggregate of 158,242
shares of its common stock, par value $0.0001 per share, to two
investors upon the conversion of an aggregate of $340,839 of
outstanding senior secured convertible debentures.
On Aug. 1, 2013, the Company issued an aggregate of 117,500 shares
of common stock to two investors upon the conversion of an
aggregate of $253,084 of Debentures.
As of Aug. 1, 2013, the Company had 1,269,929 shares of common
stock issued and outstanding.
About WPCS International
Exton, Pennsylvania-based WPCS International Incorporated provides
design-build engineering services that focus on the implementation
requirements of communications infrastructure. The Company
provides its engineering capabilities including wireless
communication, specialty construction and electrical power to the
public services, healthcare, energy and corporate enterprise
markets worldwide.
As reported by the TCR on Dec. 8, 2011, WPCS International and its
United Stated based subsidiaries, previously entered into a loan
agreement, dated April 10, 2007, as extended, modified and amended
several times, with Bank of America, N.A. The Company is seeking
alternative debt financing and has conducted discussions with
other senior lenders to replace the Loan Agreement. The Company
may not be successful in obtaining alternative debt financing or
additional financing sources may not be available on acceptable
terms. If the Company is required to repay the Loan Agreement,
the Company has sufficient working capital to repay the
outstanding borrowings.
J.H. COHN LLP, in Eatontown, New Jersey, issued a "going concern"
qualification on the consolidated financial statements for the
fiscal year ended April 30, 2012. The independent auditors noted
that the Company is in default of certain covenants of its credit
agreement and has incurred operating losses, negative cash flows
from operating activities and has a working capital deficiency as
of April 30, 2012. These matters raise substantial doubt about
the Company's ability to continue as a going concern.
WPCS reported a net loss attributable to the Company of
$20.54 million for the year ended April 30, 2012, compared to a
net loss attributable to the Company of $36.83 million during the
prior fiscal year. For the nine months ended Jan. 31, 2012, the
Company incurred a net loss of $724,000 on $32.9 million of
revenue, as compared with a net loss of $12.02 million on $53.5
million of revenue for the same period a year ago.
The Company's balance sheet at Jan. 31, 2013, showed $24.10
million in total assets, $18.62 million in total liabilities and
$5.48 million in total equity.
WVSV HOLDINGS: Wants to Hire Udall Shumway as Special Counsel
-------------------------------------------------------------
W.V.S.V. Holdings, LLC, seeks bankruptcy court authority to employ
Udall Shumway, PLC, as special counsel to represent it in an
action currently pending in the Maricopa County Superior Court,
and captioned Cal X-Tra v. W.V.S.V. Holdings, LLC, et al.,
Maricopa County Superior Court No. CV 2003-008362.
Ryan P. Dyches, Esq., will be primarily representing the Debtor.
He charges a $250 hourly rate for their services. The hourly rate
for the firm's paralegals and legal assistants varies between $135
and $160. The firm will also charge for actual and necessary
expenses.
Ryan P. Dyches, Esq., assures the Court that his firm represents
no interest adverse to the Debtor in the matter on which it is to
be engaged for the Debtor.
About WVSV Holdings
W.V.S.V. Holdings LLC, the owner of about 13,000 acres of vacant
land in Buckeye, Arizona, filed a petition for Chapter 11
protection (Bankr. D. Ariz. Case No. 12-10598) on May 14, 2012, in
Phoenix. The Debtor claims that the three tracts of land planned
for "future development" are worth $120 million and secure $57.3
million in debt. The Debtor scheduled $120.04 million in assets
and $57.35 million in liabilities.
West Valley Ventures, LLC, owns 75% of the Debtor, and Breycliffe,
LLC, owns the remaining 25%.
Judge Redfield T. Baum, Sr., presides over the case. Michael W.
Carmel, Esq., serves as the Debtor's counsel. The petition was
signed by Lee Allen Johnson, manager of West Valley Ventures,
manager.
The U.S. Trustee has not appointed an official committee of
unsecured creditors in the Debtor's case because an insufficient
number of persons holding unsecured claims against the Debtor have
expressed interest in serving on a committee. The U.S. Trustee
reserves the right to appoint the committee should interest
develop among the creditors.
Under the Plan filed in the Debtor's case, each holder of general
unsecured claims will receive 100% of its allowed general
unsecured claim. Payments will be made in four equal semi-annual
payments.
XERIUM TECHNOLOGIES: S&P Keeps 'B' CCR & Alters Outlook to Stable
-----------------------------------------------------------------
Standard & Poor's Rating Services said that it revised its outlook
on the corporate credit rating on XeriumTechnologies Inc. to
stable from negative. At the same time, S&P affirmed the ratings
on the company, including the 'B' corporate credit rating.
"The outlook revision reflects our expectation that some
stabilization in Xerium's end markets and cost reductions will
enable the company to maintain total debt to EBITDA of 5x-6x,"
said Standard & Poor's credit analyst Carol Hom. "In addition,
the company's recent refinancing into a covenant-lite credit
facility alleviated pressure resulting from declining covenant
headroom."
"The rating on Xerium reflects our view of the company's "weak"
business risk profile and "highly leveraged" financial risk
profile. The business risk profile takes into account Xerium's
continued presence in the cyclical and competitive market for
papermaking products, the limited end-user industry
diversification, and our expectation that structurally weak
medium-term demand in mature markets will likely continue to
pressure prices for the company's products. Xerium's sound
margins and fair geographic diversification partly offset these
weaknesses, in our view. The company's geographic diversification
should enable it to benefit from more positive industry
fundamentals in emerging markets, especially Asia," S&P noted.
S&P views the company's management and governance profile as
"fair."
The outlook is stable. Despite the slow growth conditions, S&P
expects Xerium's recent cost-cutting activities to enable it to
maintain credit measures within its expectations for the rating,
including total debt to EBITDA of 5x-6x. S&P could lower the
rating if EBITDA declines and the company doesn't reduce its debt,
causing leverage to increase and remain higher than 6x. Sustained
global economic weakness, increased pricing pressures, and adverse
foreign exchange movements are factors that could contribute to
such a scenario.
S&P could raise the rating if the company reduces leverage to
about 4.5x, and S&P expects it to remain at this level. This
could result from revenue growth, stable operating margins, and
debt reduction using free cash flow. S&P would also expect the
company to adhere to a financial policy consistent with a higher
rating.
* BofA Argues Against Class-Action Loan Modification Suit
---------------------------------------------------------
Janelle Lawrence & David McLaughlin, writing for Bloomberg News,
reported that Bank of America Corp. asked a federal judge to
reject homeowners' effort to sue the bank over its failure to
modify mortgage loans as a class-action case.
According to the report, the second-biggest U.S. lender by assets
urged U.S. District Judge Rya Zobel in Boston to deny the
borrowers' request to pursue the case as a group, which would give
them greater leverage in the litigation.
"What was brought as a series of lawsuits has been reduced to
desperate attempts to seek certification by any means," Bank of
America lawyer James W. McGarry told the judge, referring to
certifying the case as a class action, the report related.
Bank of America, based in Charlotte, North Carolina, is being sued
by homeowners who claim the company didn't comply with a
government program aimed at modifying mortgage loans called the
Home Affordable Modification Program, the report said.
The borrowers claim the bank first granted temporary
modifications, then ordered employees to stall, lie to customers
and falsify documents, the report further related. They cite
statements in court documents by former Bank of America employees
who said they were rewarded with cash bonuses and gift cards for
sending applicants into foreclosure.
The case is In Re Bank of America Home Affordable Modification
Program (HAMP) Contract Litigation, 10-md-02193, U.S. District
Court, District of Massachusetts (Boston).
* SAC Seen Avoiding $14 Billion Death Penalty From U.S.
-------------------------------------------------------
Greg Farrell & Patricia Hurtado, writing for Bloomberg News,
reported that the money-laundering complaint U.S. Attorney Preet
Bharara filed against Steven Cohen's SAC Capital Advisors LP
raised the prospect that the hedge fund's $14 billion in assets
may be subject to forfeiture.
"The government couldn't put Steve in jail," said Michael Bachner,
a defense attorney and former New York prosecutor, the report
related. "But they decided to give his money the death penalty."
According to the report, a less drastic outcome is probable for
the Stamford, Connecticut-based hedge fund and Cohen based on
limits judges have put on past efforts by prosecutors to take all
of a defendant's assets.
In announcing the lawsuit and SAC's parallel indictment for
insider trading, Bharara wouldn't specify the dollar amount he was
seeking, the report said. His money-laundering complaint just
says he wants "all right, title and interest" in SAC's assets,
should he prove his case.
The law underlying the civil case states that any property
"involved in" money-laundering activities, or traceable to them,
can be forfeited. That sweeping language has proved more limited
than it sounds, the report added.
Judges have approved forfeiture of illegal profits from a crime
plus money derived from those profits, including appropriate
interest, according to lawyers who have dealt with the money-
laundering law, the report further related. Bharara said that
criminal conduct at the fund had resulted in "hundreds of millions
of dollars of illegal profits."
* Fitch: US Personal Bankruptcies Set to Drop for 3rd Straight Yr.
------------------------------------------------------------------
U.S. personal bankruptcy filings are poised to drop for a third
consecutive year in 2013 and may in fact fall to a level seen only
twice before in the last two decades, according to Fitch Ratings
in a new report.
Personal bankruptcy filings totaled 532,290 at the end of first-
half 2013 (1H'13), 13.7% lower than a year earlier (616,911).
Senior Director Steven Stubbs attributes the sizeable year-over-
year decline to various macro factors. 'Consumers are continuing
to lower their personal debt levels as the growth in the U.S.
economy is gaining momentum,' said Mr. Stubbs. 'Personal income
levels are also on the rise, as are home values.'
For this year, Fitch is projecting a 13%-15% drop in personal
bankruptcy filings for 2013 from full-year 2012 levels.
Furthermore, 'personal bankruptcies may dip below the one million
threshold for just the third time in nearly 20 years,' said
Stubbs.
Lower personal bankruptcy filings translate to good news to
consumer ABS collateral. Performance for both credit card and auto
loans has been at or near historic levels during 1H'13. Fitch's
outlook for personal bankruptcy filings will continue to buoy
consumer ABS performance barring any unforeseen macroeconomic
shocks.
* Business Bankruptcies Down 30% Over 2012, Report Says
-------------------------------------------------------
Maria Chutchian of BankruptcyLaw360 reported that business
bankruptcy filings are down 30 percent so far in 2013 compared to
where they were at this point in 2012 -- with California
contributing the most -- as the downward trend of the last four
years continues, according to a report issued Wednesday.
The report related that California has, so far, contributed the
largest number of business bankruptcy filings in 2013, making up
13.75 percent of the total pot, a report from New Generation
Research unit Bankruptcydata.com says. Florida comes in second
with 8.8 percent, the report said.
* N.Y. Resort Owners Charged With $96 Million Ponzi Fraud
---------------------------------------------------------
Christie Smythe, writing for Bloomberg News, reported that a money
manager and a real estate developer already facing a regulator's
fraud lawsuit were charged with running a $96 million Ponzi scheme
and diverting the proceeds to their New York beachfront resort.
According to the report, Brian R. Callahan, 43, and his brother-
in-law Adam J. Manson, 41, were charged in a 24-count indictment
unsealed in federal court in Central Islip, New York. They pleaded
not guilty and were released on bond.
The men are accused of telling investors that their money was
going into hedge funds and other investment vehicles while
actually much of it was going to the unprofitable 117-unit
Panoramic View Resort & Residences in Montauk, the report related.
"The defendants used one of Long Island's landmarks, the Panoramic
View Resort, to perpetrate a wide-ranging fraud," U.S. Attorney
Loretta Lynch said in a statement about the scheme, which
purportedly took place from 2006 to 2012 and involved more than 40
investors, the report cited. "To conceal their status as business
failures, the defendants employed all the tricks in the typical
con man's bag."
Callahan, of Old Westbury, and Manson, of New York, were partners
in Distinctive Ventures, a real estate investment firm that
purchased the resort in January 2007 for about $38 million,
according to the indictment, the report related. Callahan, a
former securities broker who was sanctioned by regulators in 2009,
was also managing a group of offshore investment funds, for which
he was soliciting money from investors, the U.S. said.
* Tourre's Junior Staff Defense Seen Leading to Trial Loss
----------------------------------------------------------
Bob Van Voris & Patricia Hurtado, writing for Bloomberg News,
reported that Fabrice Tourre, the former Goldman Sachs Group Inc.
vice president found liable for his role in a failed $1 billion
investment, may have lost his case because jurors rejected his
defense that as a junior employee he wasn't primarily responsible
for the transaction.
"Being 28 years old and one of several employees of Goldman Sachs
isn't a defense," Tom Gorman, a former lawyer with the Securities
and Exchange Commission's Enforcement Division, who is now in
private practice, said in an interview, according to the report.
Tourre was a highly paid specialist working in a particular area
who asked people to invest billions of dollars in a product he
created, Gorman said, the report related. Tourre's lawyers
portrayed him as a young employee who was one of many Goldman
Sachs employees who worked on the 2007 deal known as Abacus that
had subprime mortgage-backed securities underlying the
transaction.
The SEC accused Tourre, now 34, of intentionally misleading
participants in Abacus about the role played by Paulson & Co., the
hedge fund of billionaire John Paulson, which helped choose the
portfolio of securities, then made a billion-dollar bet it would
fail, the report added. Tourre was found liable by a jury in
Manhattan on six of seven claims.
The case is SEC v. Tourre, 10-cv-03229, U.S. District Court,
Southern District of New York (Manhattan).
* Leveraged Loans Pass 2012 Level With Record Ahead
---------------------------------------------------
Kristen Haunss, writing for Bloomberg News, reported that the
riskiest U.S. companies are stepping up their borrowing in the
market for leveraged loans, with the amount of financings
completed this year already exceeding what they raised in all of
2012.
According to the report, borrowers from HJ Heinz Co. to Valeant
Pharmaceuticals International Inc. have tapped non-bank lenders
for $298.4 billion in 2013, more than the $295.3 billion obtained
last year, according to Standard & Poor's Capital IQ Leveraged
Commentary and Data. At the current pace, the record of $386.6
billion in 2007 will be eclipsed before year-end.
Rather than leveraging up, more than half of the loans made this
year have been used to reduce interest costs or extend maturities
as companies take advantage of investor demand to strengthen their
balance sheets, the report said. Investors added a record $2.1
billion last week into funds that buy loans, bringing the total
for the year to more than $40 billion, according to Bank of
America Corp.
"We have seen significant demand" for high-yield, high-risk loans,
said Scott Baskind, the co-chief investment officer for the senior
secured bank loan team in New York at Invesco Ltd., which oversees
$22 billion of the debt, the report added.
* Dodd-Frank Foes Could Devise Strategy From Failed Suit
--------------------------------------------------------
Law360 reported that although a judge dismissed a broad attack
against several key Dodd-Frank Act provisions from a Texas bank,
conservative activist groups and 11 states on standing grounds,
the ruling clarifies how more targeted challenges against the
sprawling law could succeed, experts say.
According to the report, U.S. District Judge Ellen Segal Huvelle
found the plaintiffs lacked standing to bring the challenge to
parts of Dodd-Frank, largely because none of them had been
directly harmed by the rules and agencies the sprawling 2010
financial regulatory reform law had established. Judge Huvelle
also found that the Texas bank and 11 states that launched the
suit based their claims on hypothetical harms and not real
government actions against them.
The Plaintiffs were the State National Bank of Big Spring Texas
and advocacy group the 60 Plus Association. They were later
joined by the attorneys general of Alabama, Georgia, Kansas,
Michigan, Montana, Nebraska, Ohio, Oklahoma, South Carolina, Texas
and West Virginia.
Lead counsel for the private plaintiffs, C. Boyden Gray of Boyden
Gray & Associates, filed a notice of appeal, taking the dispute to
the U.S. Court of Appeals for the D.C. Circuit, Law.com said.
"[I]t is disturbing that the opinion?and the government?ignored
the very real harm Dodd-Frank has inflicted on [the bank] and the
customers who rely on the bank to provide loans for everything
from their home to their small business," he said in a statement,
according to Law.com. The decision also "misconstrues" Dodd-
Frank's effect on the states, he added.
* Fed's Raskin Is Chosen for Deputy Treasury Secretary
------------------------------------------------------
James Politi, writing for The Financial Times, reported that
Barack Obama has chosen Sarah Bloom Raskin, a Federal Reserve
governor, to be deputy Treasury secretary, adding to the list of
vacancies at the US central bank.
According to the report, Ms Raskin's appointment would make her
the highest-ranking woman to serve in the Treasury department,
where she will replace Neal Wolin, who served as deputy to both
Tim Geithner and Jack Lew, Mr Obama's two Treasury secretaries.
Her shift from the Fed to the Treasury comes as Elizabeth Duke,
another Fed governor, is also set to leave the central bank, the
report said.
As well as replacements for these two open seats, the US president
is considering his options for a successor to Ben Bernanke, the
Fed chairman, whose term expires next year, the report added.
Janet Yellen, the Fed vice-chair, and Larry Summers, the former
Treasury secretary, are seen as leading contenders for the job,
though the White House has indicated a decision will not be made
until the autumn.
Ms Raskin, 52, is a former Maryland financial regulator who took
office as a Federal Reserve governor in October 2010.
* Fed's Debit Card Swipe-Fee Rules Rejected by U.S. Judge
---------------------------------------------------------
Tom Schoenberg, writing for Bloomberg News, reported that
retailers battling banks over debit-card transaction costs may
benefit from lower fees after winning a court ruling on claims
they were overcharged billions of dollars under an unlawful rate
set by the Federal Reserve.
According to the report, U.S. District Judge Richard Leon in
Washington ruled that the Fed considered data it wasn't allowed to
use under the Dodd-Frank law in setting the cap on debit-card
transaction fees, known as swipe fees, at 21 cents, and neglected
to bolster competition in card networks.
"The board's final rule not only fails to carry out Congress's
intention; it effectively countermands it!" Leon wrote in his
ruling, the report said.
The decision, unless overturned on appeal, will force regulators
to revisit rules that bankers said would cost them 45 percent of
their swipe-fee revenue, the report related. Lenders collected
about $16 billion annually from those fees before the Fed's
regulation and responded by cutting back on perks such as rewards
programs and free checking to soften the blow to their profits.
The Fed's rule, in effect since October 2011, will stay in place
until the central bank drafts new regulations or interim
standards, Leon said.
The case is NACS v. Board of Governors of the Federal Reserve
System, 11-cv-02075, U.S. District Court, District of Columbia
(Washington).
* Experts Discuss Alternatives to Chapter 11 Bankruptcy
-------------------------------------------------------
Three corporate restructuring experts see an increasing number of
distressed companies choose alternatives to filing for chapter 11
protection. The trend is especially prevalent in the middle
market where companies and their lenders have less money available
to fund a traditional chapter 11 restructuring.
"Chapter 11 no longer provides many companies a realistic
opportunity to rehabilitate and get a fresh start under the
Bankruptcy Code. Many in the insolvency community agree that it
is simply not a cost effective process," says Dan Dooley,
Principal and CEO of MorrisAnderson.
Mr. Dooley will be joined by Kay Standridge Kress, a corporate
restructuring and bankruptcy partner in the Detroit office of
Pepper Hamilton LLP, and Jeffrey Wurst, chairman of the Financial
Services, Banking, & Bankruptcy Department at Ruskin Moscou
Faltischek, P.C. on Thursday, August 15, 2013, at 11:00 a.m.,
Eastern Time, to share their observations and practice tips during
a live webinar.
Mr. Dooley, Ms. Kress and Mr. Wurst will answer two important
questions in this webinar:
(1) What are the primary alternatives to a bankruptcy filing;
and
(2) Why would unsecured creditors agree to a bankruptcy
alternative and not attempt to file an involuntary petition?
Visit http://bankrupt.com/webinars/for more information and to
register for the webinar.
This webinar is produced by Beard Group, Inc. Beard Group
publishes Turnarounds & Workouts, the Troubled Company Reporter,
and the Troubled Company Prospector. Visit
http://bankrupt.com/freetrial/for a free trial subscription to
one or more of Beard Group's corporate restructuring publications.
Beard Group also hosts the annual Distressed Investing conference
on the Monday following Thanksgiving.
Contact: Peter A. Chapman, Beard Group, Inc., (215) 945-7000.
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
Aug. 8-10, 2013
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Workshop
Hotel Hershey, Hershey, Pa.
Contact: 1-703-739-0800; http://www.abiworld.org/
Aug. 22-24, 2013
AMERICAN BANKRUPTCY INSTITUTE
Southwest Bankruptcy Conference
Hyatt Regency Lake Tahoe, Incline Village, Nev.
Contact: 1-703-739-0800; http://www.abiworld.org/
Oct. 3-5, 2013
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Wardman Park, Washington, D.C.
Contact: http://www.turnaround.org/
Nov. 1, 2013
AMERICAN BANKRUPTCY INSTITUTE
NCBJ/ABI Educational Program
Atlanta Marriott Marquis, Atlanta, Ga.
Contact: 1-703-739-0800; http://www.abiworld.org/
Dec. 2, 2013
BEARD GROUP, INC.
20th Annual Distressed Investing Conference
The Helmsley Park Lane Hotel, New York, N.Y.
Contact: 240-629-3300 or http://bankrupt.com/
Dec. 5-7, 2013
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Terranea Resort, Rancho Palos Verdes, Calif.
Contact: 1-703-739-0800; http://www.abiworld.org/
The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday. Submissions via
e-mail to conferences@bankrupt.com are encouraged.
Last Updated: July 22, 2013
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers"
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com/
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors" Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine
Tumanda, 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 ***