/raid1/www/Hosts/bankrupt/TCR_Public/131210.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Tuesday, December 10, 2013, Vol. 17, No. 342
Headlines
250 AZ: RREF Has Objections to First Amended Plan Outline
ADVANTAGE SALES: S&P Affirms 'B+' Corp. Credit Rating
AGFEED INDUSTRIES: Security Holder Seeks Fee Examiner Appointment
AGFEED INDUSTRIES: UST's Reconsideration Motion on Bonuses Denied
AGWAY INC: Tank Ownership Claims v. Suburban Propane Dismissed
ALLIED INDUSTRIES: Bank to Oppose Cash Use Beyond Dec. 31
ALLIED SYSTEMS: Taps Dexter Hofing as Troutman Consultant
ALLY FINANCIAL: Inks $1BB Underwriting Pact with Goldman, et al.
AMERICAN AIRLINES: District Court Refuses to Halt Merger
AMERICAN AIRLINES: Supreme Court Justice Denies Stay in Merger
AMERICAN AIRLINES: AFA Celebrates US Airways Merger
AMERICAN AIRLINES: APFA Welcomes Newly Merged Airline
AMERICAN APPAREL: Comparable Sales for November 2013 Increased 1%
AMERICAN FIRST: S&P Assigns 'B-' ICR & Rates $55MM Notes 'B-'
APPLIED MINERALS: Stockholders Elect Five Directors
APPLIED MINERALS: Signs Distribution Agreement with Mitsui
AQUILEX INTERMEDIATE: S&P Assigns 'B' Corp. Credit Rating
AQUILEX LLC: Moody's Assigns 'B2' CFR & Rates $50MM Notes 'B2'
ASG CONSOLIDATED: S&P Raises Rating on Sr. Subordinated Notes to B
ASPEN GROUP: Presented at LD Micro Conference
ATLANTIC COAST: FJ Capital Held 8.2% Equity Stake at Nov. 27
BENTLEY PREMIER: 2 Owners File Rival Bankruptcy-Exit Plans
BIOVEST INTERNATIONAL: Taps Robert Farrell as CFO
BLUESTEM BRANDS: S&P Affirms 'B' CCR Over Upsized Term Loan
BOREAL WATER: Reports Non-Reliance on Previously Issued Reports
BRENNAN'S INC: Restaurant in New Orleans Is Liquidating
BUILDERS FIRSTSOURCE: Amends 24.8MM Shares Resale Prospectus
CAPITOL BANCORP: Multiple Parties Object to Plan Confirmation
CENTRAL ENERGY: CEGP Acquisition Holds 15.7% of Common Units
CASH STORE: To Hold Q4 Results Conference Call on Dec. 12
CEETOP INC: Unit Inks Employment Agreements with CEO and CFO
CHARMING CHARLIE: S&P Assigns 'B-' CCR & Rates $150MM Loan 'B-'
CHESAPEAKE/MPS MERGER: Moody's Assigns 'B2' CFR on Merger Deal
CITGO PETROLEUM: S&P Lowers Corp. Credit Rating to B+; Outlook Neg
CLAIRE'S STORES: Files Form 10-Q; Incurs $25.5MM Net Loss in Q3
CLOUD MEDICAL: GBH CPAs Replaces S.E. Clark as Auditors
COOPER-BOOTH: Court Okays Deal Permitting Cash Use Thru Dec. 28
CTP TRANSPORTATION: Moody's Rates $250MM Sr. Secured Notes 'B2'
CTP TRANSPORTATION: S&P Assigns 'B+' CCR & Rates $250MM Notes 'B+'
CUERVO RESOURCES: Strike Resources Demands Note Payment by Dec. 16
D.C. DEVELOPMENT: To Seek Plan Confirmation on Dec. 23
DELPHI AUTOMOTIVE: S&P Raises CCR From 'BB+', Off CreditWatch
DEMCO INC: Dec. 11 Hearing on Additional DIP Loans From NESC
DETROIT, MI: Holes in Eligibility Ruling Aid Workers
DETROIT, MI: $210-Mil. Street Lighting Plan Approved by Judge
DETROIT, MI: Donor Offers $5 Million to Help Protect Art
DETROIT, MI: Retirees Committee Supports DIP Financing
DETROIT, MI: Emergency Manager Weighs Pension-Fund Takeover
DR. TATTOFF: Inks $7 Million Credit Facility with TCA Global
DUMA ENERGY: Designates Series A 7% Convertible Preferred Stock
EDISON MISSION: Creditors Use Wilder to Chase Parent
ELBIT IMAGING: Gets NASDAQ Notification on Stockholders' Equity
ELBIT VISION: Avi Gross, et al., to Sell 49.7MM Ordinary Shares
ENDO HEALTH: Moody's to Withdraw Ba1 Sec. Loan Rating at Closing
EMCOR GROUP: S&P Raises Corp. Credit Rating From 'BB+'
EMERITO ESTRADA: Chapter 11 Plan Deadline Extended to March
EQUIPOWER RESOURCES: S&P Affirms 'BB' Rating on $1.4BB Notes
EXIDE TECHNOLOGIES: Hires Ernst & Young as Tax Services Provider
FIBERTOWER CORP: Creditors Allowed to Begin Voting on Plan
FINJAN HOLDINGS: Files Copy of the Presentation with SEC
FIRST NATIONAL: Settles Shareholder Derivative Action
FNBH BANCORP: Amends Articles to Create Series of Preferred Stock
FOREST LABORATORIES: Upsized Unsec. Notes No Impact on S&P's CCR
FRESNO, CA: S&P Lowers Debt Ratings to 'BB+' on Weak Finances
FURNITURE BRANDS: Officers Want Some D&O Insurance
GELT PROPERTIES: Court Okays Changes to Beneficial Mutual Accord
GENERAL MOTORS: U.S. Government Sells Remaining Stake
GENERAL MOTORS: To Shift Production in Asia
GENIUS BRANDS: Four Directors Quit, Seven Directors Appointed
GONZALES RDA: S&P Lowers Long-Term Rating on 2011 TABs to 'BB-'
HEADWATERS INC: S&P Rates Proposed $150MM Sr. Unsec. Notes 'CCC+'
INFUSYSTEM HOLDINGS: Files Copy of Presentation with SEC
ISOLA USA: S&P Revises Outlook to Stable & Affirms 'B-' CCR
IZEA INC: Expects to Report 100% Bookings Growth for Q4
KAHN FAMILY: Court OKs Marty P. Ouzts as Accountant
LIBERTY HARBOR: Dec. 26 Hearing to Confirm 2nd Amended Plan
LIFE CARE ST. JOHNS: Balks at Cook Bid for Ombudsman
LIME ENERGY: Stockholders Elect Five Directors
LINENS 'N THINGS: Hilco Sells IP Assets to Carlyle Unit
LLS AMERICA: Judge Allows Withdrawal of Foster Pepper as Counsel
LLS AMERICA: Bankr. Court Recommends Summary Judgment vs. Briscoe
LOS ANGELES HOUSING: S&P Cuts 2009A Revenue Bonds Rating to 'BB+'
MAUI LAND: Resolves Kapalua Purchase Agreement Disputes
MAX MEDIA 1: Auction of Assets Set for Jan. 7
MF GLOBAL: Sapere Loses Appeal in U.S. Circuit Court
MONTE VISTA GARDENS: Auction of Assets Set for Dec. 20
MORGANS HOTEL: Jan. 27 Hearing on Claims Dismissal vs. M. Gross
MOXIE PATRIOT: S&P Assigns Prelim. 'B+' Rating to $385MM Loan
MUD KING: Wants Plan Filing Deadline Extended to March 3
NCR CORP: S&P Affirms 'BB+' CCR & Rates New $300MM Notes 'BB'
NET ELEMENT: Shareholders Elect Seven Directors
NEW YORK CITY OPERA: Online Asset Auction Scheduled for Dec. 19
NEWLEAD HOLDINGS: Incurs $45.2 Million Net Loss in H1 2013
NEXTAG INC: S&P Lowers CCR to 'CCC' on Weak Operating Performance
NNN 123: Court Approves Kaye Scholer as Counsel
NNN 3500: Hires BMC Group as Tabulation Agent
NORTEL CORP: U.S. Court Upholds Trial Plan over $7.5-Bil. in Cash
NORTHERN BEEF: Sold to Lender White Oak for $44.3 Million
OCEANSIDE MILE: Has Access to Cash Collateral Until Jan. 21
OCZ TECHNOLOGY: Has Interim Authority to Tap $21MM in DIP Loan
OCZ TECHNOLOGY: Can Pay $4.02MM to Critical Vendors in the Interim
OCZ TECHNOLOGY: Section 341(a) Meeting Set on January 6
OPAL ACQUISITION: S&P Assigns 'B' CCR Over Merger Deal
ORCHARD SUPPLY: First Amended Plan, Supplement Filed
PABELLON DE LA VICTORIA: Exclusive Plan Filing Deadline Expires
PACIFIC ARCHITECTS: S&P Assigns 'BB-' Rating to $342MM Debts
PEP-PG TEMPE: Auction of Assets Set for Dec. 27
PLUG POWER: Open Joint Stock Held 4.3% Equity Stake at Sept. 16
POSITIVEID CORP: Holds 3% Equity Stake in VeriTeQ Corp
PROTECTION ONE: S&P Affirms B CCR & B Rating on $100MM Loan Add-on
RENTECH NITROGEN: S&P Puts 'B' CCR on CreditWatch Negative
RESIDENTIAL CAPITAL: Second Amended Plan, Exhibits Filed
REVSTONE INDUSTRIES: Equity Holders' Trustee Hires Ramaekers Group
ROSETTA GENOMICS: Highlights Progress in Letter to Shareholders
ROUNDYS SUPERMARKETS: Moody's Rates $200MM Second Lien Notes 'B3'
RTL-WESTCAN: S&P Removes B+ CCR on CreditWatch & Withdraws Rating
RURAL/METRO CORP: Wants Plan Filing Period Extended to Jan. 31
SCOTTSDALE VENETIAN: Has Access to Cash Collateral Until Jan. 15
SEQUENOM INC: R. Lindsay to Retire as EVP - Strategic Planning
SEARS HOLDINGS: Plans to Spin-Off Lands' End Business
SHELBOURNE NORTH WATER: Files List of 20 Top Unsecured Creditors
SIERRA HAMILTON: S&P Assigns 'B-' CCR & Rates $110MM Notes 'B-'
SIMPLER SOLAR: Wins $57,000 Judgment Against Renitta
SIMPLY WHEELZ: Bankruptcy Casts Doubt on Hertz Antitrust Fix
STELERA WIRELESS: Okayed to Sell FCC Licenses to AT&T for $6MM
SUNRISE REAL ESTATE: Incurs $966,000 Net Loss in Third Quarter
THERAKOS INC: S&P Affirms 'B' CCR Over Increased Term Loan
TITAN PHARMACEUTICALS: Braeburn Held 11% Equity Stake at Nov. 25
TRANS-LUX CORP: Obtains $1 Million Financing From Carlisle
TRANSGENOMIC INC: Austin Marxe Held 1.9% Equity Stake at Nov. 29
TRIGEANT LTD: BTB Wants to Proceed with 5th Circuit Appeal
TRIGEANT LTD: Reorganization is New Chapter in Old Family Feud
TRIUMPH GROUP: S&P Hikes CCR to BB+ on Revised Criteria, Off Watch
TWIN DEVELOPMENTS: Chapter 11 Reorganization Case Dismissed
VAIL LAKE: Court Approves Stipulation on Cash Collateral Use
VALEANT PHARMACEUTICALS: S&P Rates Proposed $3.17-Bil. Loan 'BB'
VERITEQ CORP: PositiveID Holds 3% Equity Stake
VIGGLE INC: Robert Sillerman Held 83.7% Equity Stake at Nov. 25
VITESSE SEMICONDUCTOR: To Offer $75 Million Worth of Securities
VITESSE SEMICONDUCTOR: Incurs $22.1-Mil. Net Loss in Fiscal 2013
VERITEQ CORP: Hudson Bay, et al., to Sell 6.3MM Common Shares
WALKER LAND: Hearing Tomorrow on Bid to Use Cash Collateral
WALTER INVESTMENT: Moody's Rates $500MM Sr. Unsecured Notes 'B3'
ZALE CORP: Files Form 10-Q; Incurs $27.3MM Net Loss in Q1 2014
ZOGENIX INC: Board OKs Employment Inducement Incentive Plan
* Glass-Steagall Fans Plan New Assault If Volcker Rule Deemed Weak
* Banks Poised to Reduce Rate-Swap Trading as Revenue Seen Reduced
* S&P Puts Various California Statewide Communities on Watch Neg.
* Large Companies With Insolvent Balance Sheets
*********
250 AZ: RREF Has Objections to First Amended Plan Outline
---------------------------------------------------------
250 AZ LLC will fight off objections from RREF II DFC Acquisition,
LLC, to the Debtor's First Amended Disclosure Statement explaining
its bankruptcy-exit plan at a hearing on Dec. 12.
RREF, a secured creditor, argues that the Court should not approve
the disclosure statement explaining the Debtor's First Amended
Plan for two reasons: (1) the document discusses a plan which
cannot be confirmed under 11 U.S.C. Sec. 1129; and (2) it does not
contain "adequate information" as required by 11 U.S.C. Sec. 1125.
RREF avers the Disclosure Statement should not be approved unless
and until appropriate revisions are made. RREF says the Plan
cannot be confirmed for various reasons, including:
1. The Plan requires partial releases of RREF's collateral
contrary to the deeds of trust securing its debt. The Debtor may
not obtain partial releases of RREF's collateral without RREF's
consent. An exhibit to the Plan lists a sale of a portion of the
collateral property located at 3390 W. Ina Road, Tucson, Arizona,
in year 3 and a subsequent sale of the collateral property located
at 3391 W. Ina Road, Tucson, Arizona, in year 4. The listed sale
price for each property is less than RREF's filed claim. This
treatment violates 11 U.S.C. Sec. 1129(b)(2)(A)(i)(I).
2. The Plan provides treatment of the secured claim held by
RREF based upon the Debtor's appraisal rather than the higher
figure tentatively found by this Court after conducting an
evidentiary hearing on valuation. The Plan fails to adopt the
valuation ultimately found by the Court in its upcoming order on
valuation of RREF's collateral. This treatment violates
1129(b)(2)(A)(i)(II).
3. The Plan indicates that no interest payments will be made on
the secured claim during the first year. The failure to pay
interest results in a failure to provide a note which has a
present value equal to the amount of the secured claim. This
treatment violates 1129(b)(2)(A)(i)(II).
A full-text copy of the objection is available for free at:
http://bankrupt.com/misc/250AZ_1stA_DS_Obj_RREF.pdf
RREF II DFC Acquisition is represented by:
Christopher C. Simpson, Esq.
STINSON MORRISON HECKER LLP
1850 N. Central Avenue, Suite 2100
Phoenix, AZ 85004-4584
Tel: (602) 279-1600
Fax: (602) 240-6925
E-mail: csimpson@stinson.com
- and -
Mark S. Carder, Esq.
STINSON MORRISON HECKER LLP
1201 Walnut, Suite 2900
Kansas City, MO 64105
Tel: (816) 842-8600
Fax: (816) 691-3495
E-mail: mcarder@stinson.com
The Chapter 11 Plan
As reported in the Nov. 13, 2013 edition of the TCR, the Debtor
filed a Chapter 11 plan that proposes to pay the allowed secured
claim of the first mortgage holder on each rental property and on
the development parcels. Unsecured creditors will each claim pro
rata share of funds allocated for the class (a minimum of $10,000
per year over a five-year period).
A full-text copy of the First Amended Disclosure Statement dated
Nov. 4, 2013, is available for free at:
http://bankrupt.com/misc/250_AZ_1ds.pdf
About 250 AZ, LLC
250 AZ, LLC, filed a Chapter 11 petition (Bankr. D. Ariz. Case No.
13-00851) in Tucson, Arizona, on Jan. 22, 2013. In its schedules,
the Debtor disclosed $25 million in assets and $70.8 million in
liabilities. 250 AZ owns an 84.70818% tenant in common interest
in a 29-story office building located at 250 East Fifth Street, in
Cincinnati, Ohio.
The Debtor is represented by Dennis M. Breen, III, Esq., and John
E. Olson, Esq. at Breen Olson & Trenton, LLP as counsel.
The U.S. Trustee said an official committee of unsecured creditors
has not been appointed because an insufficient number of persons
holding unsecured claims against the company have expressed
interest in serving on a committee.
ADVANTAGE SALES: S&P Affirms 'B+' Corp. Credit Rating
-----------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit rating of Irvine, Calif.-based Advantage Sales & Marketing
Inc. The outlook is stable.
At the same time, S&P affirmed the 'B+' issue rating on the first-
lien debt, which includes the $225 million tack-on offering, and
revised the recovery rating to '3' from '4'. The '3' recovery
rating indicates S&P's expectation of meaningful recovery (50% to
70%) for first-lien lenders in the event of a payment default.
Also, S&P affirmed its 'B-' issue rating on the second-lien term
loan. The '6' recovery rating is unchanged, indicating S&P's
expectation of negligible recovery (0% to 10%) for second-lien
lenders in the event of a payment default.
"The ratings affirmation reflects our assessment that the
incremental debt and acquisition of the remaining 31% equity
interest in Advantage Waypoint LLC does not meaningfully change
our base-case forecast for credit measures to remain weak under
continued financial sponsor ownership," said Standard & Poor's
credit analyst Brian Milligan.
Advantage Waypoint is a leading sales and marketing agency in the
foodservice channel. Advantage acquired 69% of Waypoint in
December 2011.
Standard & Poor's assesses Advantage's business risk profile as
"satisfactory." This reflects the favorable industry dynamics and
S&P's belief that Advantage will grow sales and profits as
consumer packaged-goods (CPG) producers increase outsourcing of
sales and marketing functions. In S&P's view, Advantage's
services are cost-efficient, which should continue to support
sales and profit growth.
Advantage's credit measures are indicative of a "highly leveraged"
financial risk profile. But even if credit measures were to
improve to levels indicative of an "aggressive" financial risk
profile, financial sponsor ownership will likely keep the profile
constrained to "highly leveraged."
AGFEED INDUSTRIES: Security Holder Seeks Fee Examiner Appointment
-----------------------------------------------------------------
James Regnante, a security holder of AgFeed Industries Inc., et
al., asks the U.S. Bankruptcy Court for the District of Delaware
to deny the applications for fees and expenses of these
professionals:
(A) Attorneys and Financial Advisors for the Debtors:
1) Young Conaway Stargatt & Taylor, LLP, for the periods
July 15, 2013, to Sept. 30, 2013
2) Foley and Lardner, LLP, for the periods July 15, 2013, to
Sept. 30, 2013
3) Lathan Watkins, LLP, for the periods July 15, 2013, to
Sept. 30, 2013
4) BDA Advisors, LLP, for the periods July 15, 2013, to
Sept. 12, 2013
5) Gerald Leeper for the periods July 15, 2013, to Sept. 12,
2013
(B) Attorneys and Financial Advisors for Unsecured Creditors:
1) Greenberg Traurig LLP for the periods Aug. 1, 2013, to
Sept. 30, 2013
2) Lowenstein Sandler LLP for the periods Aug. 1, 2013, to
Sept. 30, 2013
3) Cohnreznick, LLP, for the periods Aug. 1, 2013, to Sept. 30,
2013
(C) Attorneys and Financial Advisors for Equity Security Holders
Committee:
1) Sugar Felsenthal Grais & Hammer, LLP, for the periods
Aug. 23, 2013, to Sept. 30, 2013
2) Elliot Greenleaf for the periods Aug. 23, 2013, to Sept. 30,
2013
3) Gavin/Solmonese, LLP, for the periods Aug. 23, 2013, to
Sept. 30, 2013
Mr. Regnante asserts the Applicants' fee and expense applications
are incorrect for all periods. He notes that the Department of
Justice guidelines for fees and expenses applications had not been
followed. Specifically, Mr. Regnante pointed out that blended
rates are applicable only licensed attorneys.
Mr. Regnante said he is unaware of how the $500 hourly limitation
amount was computed, which hourly rate gives all persons listed on
the Applications a $1,000,000 yearly salary.
Moreover, he maintains that overhead expenses are not reimbursable
and that Applicants must demonstrate that the amount requested for
in-house expenses are the actual costs for these expenses.
Mr. Regnante further asks the Court to appoint a non-attorney fee
examiner and order a mandatory Sliding Pay Scale for
professionals. According to Mr. Regnante, an independent non-
attorney Fee Examiner is essential for the integrity of the
Bankruptcy Court System.
About AgFeed Industries
AgFeed Industries, Inc., has 21 farms and five feed mills in China
producing more than 250,000 hogs annually. In the U.S., the
business included 10 sow farms in three states and two feed mills
producing more than one million hogs a year. AgFeed's revenue in
2012 was $244 million.
AgFeed and its affiliates filed voluntary petitions under Chapter
11 of the Bankruptcy Code (Bankr. D. Del. Case No. 13-11761) on
July 15, 2013, with a deal to sell most of its subsidiaries to The
Maschhoffs, LLC, for cash proceeds of $79 million, absent higher
and better offers. The Debtors estimated assets of at least $100
million and debts of at least $50 million.
Keith A. Maib signed the petition as chief restructuring officer.
Hon. Brendan Linehan Shannon presides over the case. Donald J.
Bowman, Jr., and Robert S. Brady, Esq., at Young, Conaway,
Stargatt & Taylor, serve as the Debtors' counsel. BDA Advisors
Inc. acts as the Debtors' financial advisor. The Debtors' claims
and noticing agent is BMC Group, Inc.
The U.S. Trustee has appointed a five-member official committee of
unsecured creditors to the Chapter 11 cases. The Creditors'
Committee tapped Lowenstein Sandler as lead bankruptcy counsel and
Greenberg Traurig, LLP, as co-counsel. CohnReznick LLP serves as
the Creditors' Committee's financial advisor.
An official committee of equity security holders was also
appointed to the Chapter 11 cases. The Equity Committee tapped
Sugar Felsenthal Grais & Hammer LLP and Elliott Greenleaf as
co-counsel.
AGFEED INDUSTRIES: UST's Reconsideration Motion on Bonuses Denied
-----------------------------------------------------------------
At the Nov. 26, 2013 hearing, Judge Brendan L. Shannon of the U.S.
Bankruptcy Court for the District of Delaware denied a motion for
reconsideration filed by the U.S. Trustee pursuant to Federal Rule
of Bankruptcy Procedure 9024, of the previous Court order,
pursuant to Sections 105, 363(b) and 503(c) of the Bankruptcy
Code: (i) authorizing the Debtors to honor obligations in
connection with certain key executive employment and incentive
agreements with Edward Pazdro and Gerard R. Daignault, (ii)
approving the Debtors' key executive incentive plan and key
manager incentive plan and (iii) authorizing payment of earned
bonus program holdbacks to certain key executives.
The U.S. Trustee stated in the Reconsideration Motion that, "After
the entry of the Bonus Motion Order, the Debtors filed a
Securities and Exchange Commission ('SEC') Form 8-K dated
September 5, 2013 disclosing that the SEC on August 29, 2013
issued a 'Wells Notice' to the Debtors. The Wells Notice states
that the SEC staff has recommended an enforcement action against
the Debtors for violations of the antifraud, reporting books and
records and internal controls provisions of the federal securities
laws. The Wells Notice was issued after the hearing on the Bonus
Motion; potential conduct of Pazdro and/or Daignault was not
addressed in connection with the Bonus Motion. With newly
discovered evidence now available, the U.S. Trustee respectfully
requests that this Court reconsider and vacate the Bonus Motion
Order authorizing the payment of bonuses to Pazdro and Daignault,
and conduct a hearing at which circumstances of potential
misconduct by management seeking bonuses can be addressed," the
TRC reported on Nov. 19, 2013.
About AgFeed Industries
AgFeed Industries, Inc., has 21 farms and five feed mills in China
producing more than 250,000 hogs annually. In the U.S., the
business included 10 sow farms in three states and two feed mills
producing more than one million hogs a year. AgFeed's revenue in
2012 was $244 million.
AgFeed and its affiliates filed voluntary petitions under Chapter
11 of the Bankruptcy Code (Bankr. D. Del. Case No. 13-11761) on
July 15, 2013, with a deal to sell most of its subsidiaries to The
Maschhoffs, LLC, for cash proceeds of $79 million, absent higher
and better offers. The Debtors estimated assets of at least $100
million and debts of at least $50 million.
Keith A. Maib signed the petition as chief restructuring officer.
Hon. Brendan Linehan Shannon presides over the case. Donald J.
Bowman, Jr., and Robert S. Brady, Esq., at Young, Conaway,
Stargatt & Taylor, serve as the Debtors' counsel. BDA Advisors
Inc. acts as the Debtors' financial advisor. The Debtors' claims
and noticing agent is BMC Group, Inc.
The U.S. Trustee has appointed a five-member official committee of
unsecured creditors to the Chapter 11 cases. The Creditors'
Committee tapped Lowenstein Sandler as lead bankruptcy counsel and
Greenberg Traurig, LLP, as co-counsel. CohnReznick LLP serves as
the Creditors' Committee's financial advisor.
An official committee of equity security holders was also
appointed to the Chapter 11 cases. The Equity Committee tapped
Sugar Felsenthal Grais & Hammer LLP and Elliott Greenleaf as
co-counsel.
AGWAY INC: Tank Ownership Claims v. Suburban Propane Dismissed
--------------------------------------------------------------
The Superior Court of New Jersey, Appellate Division, reversed a
trial court ruling and dismissed tank ownership claims against
Suburban Propane, L.P., and Finbar M. Doyle.
Suburban acquired certain assets of Agway Energy Products, LLC,
and two other subsidiaries of parent Agway, Inc. during Agway's
bankruptcy.
Various homeowners, all of whom have propane storage tanks which
were installed by Agway Energy at the time their respective homes
were constructed, sued Suburban and Finbar M. Doyle, contending
they acquired ownership of the tanks when they took title to their
homes. The Defendants maintain Agway Energy transferred ownership
of the tanks to them after they were installed.
The Defendants sought partial summary judgment seeking the
dismissal of some of the plaintiffs' claims, on the ground the
court lacked subject matter jurisdiction. The trial court denied
the motion and ordered the Defendants to obtain certain relief
from the U.S. Bankruptcy Court for the Northern District of New
York.
In a Dec. 5, 2013 decision available at http://is.gd/MU2dkMfrom
Leagle.com, the New Jersey appellate court reversed the denial of
the Defendants' motion for partial summary judgment and granted
judgment in the Defendants' favor dismissing the tank ownership
claims. The appellate court also vacated the provisions in the
March 26, 2013 orders which compel the Defendants to seek relief
from the Agway Bankruptcy Court.
The case is ROBERT CAPPICCILLE and JOYCE CAPPICCILLE, MARK THOGODE
and CAROL THOGODE, MICHAEL RONCINSKE and MARIE RONCINSKE, JAMES
PETERS and ANN PETERS, LARRY HANNIS and CAROL HANNIS, TRACY
MUSTACHIO and TIMOTHY MUSTACHIO, JOSEPH SABELLA and MICHELLE
SABELLA, JARROD HAMILTON and TARA HAMILTON, KENNETH WISE and NANCY
WISE, ROBERT BIGOTT and LYNN BIGOTT, DANIEL JANSEN and PAMELA
JANSEN, JOCK WAPLE and REBECCA WAPLE, INGRUM JEFFERSON and CRYSTAL
JEFFERSON, RICHARD KREPPEL and PATRICIA KREPPEL, WILHELM ELFERS
and HILDE ELFERS, JOSEPH DOYLE and VIRGINIA DOYLE, BRIAN FINNEGAN
and JANET FINNEGAN, ANTHONY GASPERINO and CAROLYN GASPERINO, JACK
IZZO and VERONICA IZZO, NATHANIEL SAJDAK and MEREDITH SAJDAK,
Plaintiffs-Respondents, v. SUBURBAN PROPANE, L.P. and SUBURBAN
PROPANE PARTNERS, L.P., individually and trading as Suburban
Energy Services, and FINBAR M. DOYLE, Defendants-Appellants, No.
A-4217-12T3 (N.J. Super.).
The appellants are represented by Michael D. Sirota, Esq., at
Cole, Schotz, Meisel, Forman & Leonard, P.A.; and Proskauer Rose
LLP's Robert J. Cleary -- rjcleary@proskauer.com
John V. McDermott, Jr., argues for the respondents.
Agway, Inc. -- an agricultural cooperative owned by 69,000
Northeast farmer-members -- sought chapter 11 protection (Bankr.
N.D.N.Y. Case No. 02-65872) on Oct. 1, 2002, represented by
Menter, Rudin & Trivelpiece, P.C. The Debtors' Second Amended
Joint Plan of Liquidation was confirmed on April 28, 2004, and the
Plan took effect on May 1, 2004. Under the terms of the Plan and
the Confirmation Order, a Liquidating Trustee was appointed to
liquidate and distribute the Liquidating Trust Assets and Claims.
D. Clark Ogle serves as the Trustee of the Agway Liquidating
Trust, and is represented by Jeffrey A. Dove, Esq., at Menter,
Rudin & Trivelpiece, P.C.
ALLIED INDUSTRIES: Bank to Oppose Cash Use Beyond Dec. 31
---------------------------------------------------------
California United Bank tells the U.S. Bankruptcy Court for the
Central District of California that it will oppose Allied
Industries, Inc.'s use of cash collateral beyond Dec. 31, 2013.
A hearing in bankruptcy court is scheduled for Dec. 12, 2013 at
9:30 a.m. on the Debtor's continued use of cash collateral.
CUB relates that pursuant to a court-approved stipulation, the
Debtor was authorized to utilize CUB's cash collateral through
Dec. 31, 2013. No motion yet has been made for authorization to
use cash collateral beyond that date.
CUB does not believe that the Debtor can propose a feasible plan
of reorganization based around the continued operation of the
Debtor's business. The bank, therefore, will not stipulate to
further cash collateral use and will oppose the Debtor's motion
for continued use of cash, absent persuasive evidence that a
feasible plan is in prospect.
Among other concerns, the bank notes that the Debtor's October
monthly operating report shows an accrued loss of over $268,000
per month.
California United Bank is represented by:
Alan M. Mirman, Esq.
Russell H. Rapoport, Esq.
MIRMAN, BUBMAN & NAHMIAS, LLP
21860 Burbank Boulevard, Suite 360
Woodland Hills, CA 91367
Tel: (818) 451-4600
Fax: (818) 451-4620
About Allied Industries
Allied Industries, Inc., filed a Chapter 11 petition (Bankr. C.D.
Cal. Case. No. 13-11948) on March 21, 2013. The petition was
signed by Ernesto Gutierrez as president and chief executive
officer. The Debtor scheduled assets of $13,086,216 and
scheduled liabilities of $7,457,365.
Then Debtor has tapped Dheeraj K. Singhal, Esq., and Dixon L.
Gardner, Esq. at DCDM Law Group, P.C., as counsel, the Capital
Turnaround Group, Inc., as turnaround consultant, and Glenn M.
Gelman & Associates as accountants.
The Official Committee of Unsecured Creditors has retained
Pachulski Stang Ziehl & Jones LLP as counsel and CohnReznick LLP
as financial advisor.
ALLIED SYSTEMS: Taps Dexter Hofing as Troutman Consultant
---------------------------------------------------------
Allied Systems Holdings Inc., et al., filed a supplement to their
application to employ Troutman Sanders LLP as co-counsel to
disclose and seek approval of the employment of Dexter Hofing LLC
as consultant.
The Debtors on June 28, 2012, filed the original application to
employ Troutman as co-counsel. The Court approved the application
on July 23, 2012.
By the supplemental application, the Debtors seek an order
authorizing Troutman to employ Dexter Hofing to act as consultant
in connection with withdrawal liability and other multiemployer
pension plan issues related to the Debtors.
The Debtors are participants in a number of multiemployer pension
plans ("MPPs") that have asserted or are expected to assert
substantial withdrawal liability claims against the Debtors'
estates. The Debtors believe that the consulting services
proposed to be provided by Dexter Hofing are necessary to enable
the Debtors to execute faithfully their duties, and to enable
Troutman to faithfully execute its duties as co-counsel to the
Debtors.
The Debtors, Troutman and Dexter Hofing have negotiated an
engagement letter. Subject to the Court's approval, Dexter Hofing
will be paid their customary hourly rates that are in effect:
a. James Dexter - $650 per hour;
b. Mitchell Hofing - $550 per hour;
c. Seth Porciello - $300 per hour.
The Debtors will also reimburse Dexter Hofing for reasonable out-
of-pocket expenses.
To the best of the Debtors' knowledge, Dexter Hofing is a
"disinterested person" within the meaning of Section 101(14) of
the Bankruptcy Code.
About Allied Systems
BDCM Opportunity Fund II, LP, Spectrum Investment Partners LP, and
Black Diamond CLO 2005-1 Adviser L.L.C., filed involuntary
petitions for Allied Systems Holdings Inc. and Allied Systems Ltd.
(Bankr. D. Del. Case Nos. 12-11564 and 12-11565) on May 17, 2012.
The signatories of the involuntary petitions assert claims of at
least $52.8 million for loan defaults by the two companies.
Allied Systems, through its subsidiaries, provides logistics,
distribution, and transportation services for the automotive
industry in North America.
Allied Holdings Inc. first filed for chapter 11 protection (Bankr.
N.D. Ga. Case Nos. 05-12515 through 05-12537) on July 31, 2005.
Jeffrey W. Kelley, Esq., at Troutman Sanders, LLP, represented the
Debtors in the 2005 case. Allied won confirmation of a
reorganization plan and emerged from bankruptcy in May 2007
with $265 million in first-lien debt and $50 million in second-
lien debt.
The petitioning creditors said Allied defaulted on payments of
$57.4 million on the first lien debt and $9.6 million on the
second. They hold $47.9 million, or about 20% of the first-lien
debt, and about $5 million, or 17%, of the second-lien obligation.
They are represented by Adam G. Landis, Esq., and Kerri K.
Mumford, Esq., at Landis Rath & Cobb LLP; and Adam C. Harris,
Esq., and Robert J. Ward, Esq., at Schulte Roth & Zabel LLP.
Allied Systems Holdings Inc. formally put itself and 18
subsidiaries into bankruptcy reorganization June 10, 2012,
following the filing of the involuntary Chapter 11 petition.
The Company is being advised by the law firms of Troutman Sanders,
Gowling Lafleur Henderson, and Richards Layton & Finger.
The bankruptcy court process does not include captive insurance
company Haul Insurance Limited or any of the Company's Mexican or
Bermudan subsidiaries. The Company also announced that it intends
to seek foreign recognition of its Chapter 11 cases in Canada.
An official committee of unsecured creditors has been appointed in
the case. The Committee consists of Pension Benefit Guaranty
Corporation, Central States Pension Fund, Teamsters National
Automobile Transporters Industry Negotiating Committee, and
General Motors LLC. The Committee is represented by Sidley Austin
LLP.
Yucaipa Cos. has 55 percent of the senior debt and took the
position it had the right to control actions the indenture trustee
would take on behalf of debt holders. The state court ruled in
March 2013 that the loan documents didn't allow Yucaipa to vote.
In March 2013, the bankruptcy court also gave the official
creditors' committee authority to sue Yucaipa. The suit includes
claims that the debt held by Yucaipa should be treated as equity
or subordinated so everyone else is paid before the Los Angeles-
based owner. The judge allowed Black Diamond to participate in the
lawsuit against Yucaipa and Allied directors.
ALLY FINANCIAL: Inks $1BB Underwriting Pact with Goldman, et al.
----------------------------------------------------------------
Ally Financial Inc. entered into an Underwriting Agreement
incorporating Ally's Underwriting Agreement Standard Provisions
with Citigroup Global Markets Inc., Goldman, Sachs & Co., J.P.
Morgan Securities LLC and Morgan Stanley & Co. LLC, as
representatives of the several Underwriters, pursuant to which
Ally agreed to sell to the Underwriters $1,000,000,000 aggregate
principal amount of 2.750 Percent Senior Guaranteed Notes due
2017. The Notes will be guaranteed by Ally US LLC and IB Finance
Holding Company, LLC, each a subsidiary of Ally, on an
unsubordinated basis. The Securities were registered pursuant to
Ally's shelf registration statement on Form S-3, which became
automatically effective on Jan. 3, 2011.
The Underwriting Agreement contains customary representations,
warranties and covenants of the Company, conditions to closing,
indemnification obligations of the Company and the Underwriters,
and termination and other customary provisions.
A copy of the Underwriting Agreement is available for free at:
http://is.gd/t0PZlU
About Ally Financial
Ally Financial Inc., formerly GMAC Inc. -- http://www.ally.com/--
is one of the world's largest automotive financial services
companies. The Company offers a full suite of automotive
financing products and services in key markets around the world.
Ally's other business units include mortgage operations and
commercial finance, and the company's subsidiary, Ally Bank,
offers online retail banking products. Ally operates as a bank
holding company.
GMAC obtained a $17 billion bailout from the U.S. government in
exchange for a 56.3 percent stake. Private equity firm Cerberus
Capital Management LP keeps 14.9 percent, while General Motors Co.
owns 6.7 percent.
Ally Financial Inc. reported net income of $1.19 billion for the
year ended Dec. 31, 2012, as compared with a net loss of $157
million during the prior year. The Company's balance sheet at
Sept. 30, 2013, showed $150.55 billion in total assets, $131.49
billion in total liabilities and $19.06 billion in total equity.
AMERICAN AIRLINES: District Court Refuses to Halt Merger
--------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that AMR Corp. is free to merge with US Airways Group Inc.
because a federal district judge denied a last-ditch effort by
plaintiffs in a private antitrust lawsuit to issue an injunction
barring the tie-up.
According to the report, the private plaintiffs' losing streak
began on Nov. 27 when U.S. Bankruptcy Judge Sean Lane wrote a 32-
page opinion rejecting their effort to enjoin the merger.
The plaintiffs went to Judge Lane because the U.S. Justice
Department settled the government's antitrust suit, allowing U.S.
Airways to merge with American Airlines Inc., the operating
subsidiary of AMR. The private plaintiffs, making much the same
allegations the government decided to settle, returned to
bankruptcy court seeking a stay pending appeal, which Judge Lane
denied on Dec. 4.
The plaintiffs then went to federal district court in Manhattan
where Chief District Judge Loretta A. Preska denied an injunction
on Dec. 6. Judge Preska said she was denying an injunction for
"substantially the same reasons" as Lane laid out in his Nov. 27
opinion.
Judge Lane said the plaintiffs "utterly failed to establish
irreparable harm," one of the requirements for an injunction.
Judge Lane found other faults in the request for a stay.
Theoretically, the plaintiffs can seek a stay from the U.S. Court
of Appeals in Manhattan. However, the merger may be completed on
Dec. 9 before the plaintiffs can arrange a hearing in the appeals
court.
AMR rose 7.5 percent on Dec. 6 to $11.39 in over-the-counter
trading. The stock closed as low as $2.57 in August, after the
government sued to bar the merger. The post-bankruptcy closing
high was $12.25 on Nov. 27.
About City of 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.
A nine-member official committee of retired workers was appointed
in the case. The Retirees' Committee is represented by Dentons US
LLP.
AMERICAN AIRLINES: Supreme Court Justice Denies Stay in Merger
--------------------------------------------------------------
Lawrence Hurley, writing for Reuters, reported that a U.S. Supreme
Court justice on Dec. 7 denied a last-ditch effort by a group of
consumers and travel agents to stop the merger of American
Airlines and US Airways.
According to the report, the application was denied by Justice
Ruth Bader Ginsburg, the court's public information office said.
The combination of American's parent, AMR Corp, and US Airways
Group would create the world's largest carrier and follow last
month's resolution of antitrust objections by the U.S. Department
of Justice, the report said.
In their appeal to the Supreme Court, plaintiffs led by California
resident Carolyn Fjord warned that "irreparable injury" could be
caused to the domestic airline industry if the deal goes ahead as
planned, the report related. They fear the merger will drive air
travel prices up and service down and make planes more crowded.
If one high court justice denies a stay request, the same
application can be made to another justice but such moves are
rarely successful, the report pointed out. Usually, if a request
is made to a second justice it will be referred to the full court.
The case is Fjord v. AMR Corp et al, U.S. Supreme Court, No. 11-
15463-SHL. The main bankruptcy case is in U.S. Bankruptcy Court,
Southern District of New York, re: AMR Corp et al, 11-15463.
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 bankruptcy judge on Sept. 12, 2013, confirmed AMR Corp.'s plan
to exit bankruptcy through a merger with US Airways. By
distributing stock in the merged airlines, the plan is designed to
pay all creditors in full, with interest.
Judge Sean Lane confirmed the Plan despite the lawsuit filed by
the U.S. Department of Justice and several states' attorney
general complaining that the merger violates antitrust laws.
In November 2013, AMR and the U.S. Justice Department a settlement
of the anti-trust suit. The settlements require the airlines to
shed 104 slots at Reagan National Airport in Washington and 34 at
LaGuardia Airport in New York.
Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
AMERICAN AIRLINES: AFA Celebrates US Airways Merger
---------------------------------------------------
The Association of Flight Attendants-CWA (AFA) issued the
following statement on Dec. 9 by AFA US Airways President Roger
Holmin as US Airways grew into the world's largest airline through
its merger with American Airlines.
"[Mon]day, we ring the bell to honor our past and celebrate our
future. Our history was made by little airlines that could -- and
did. US Airways Flight Attendants have spent entire careers
building unity. And [Mon]day, we stand up for the opportunities
that come with building the world's largest airline.
"We proudly stand shoulder-to-shoulder with our new American
flying partners and we cheer the end of the American bankruptcy.
All Flight Attendants and frontline workers at the New American
know what it is to sacrifice. There is no doubt it is our turn to
experience the benefits of our success.
"Since the announcement of this merger we have met every challenge
through unity. We expect to continue as full partners in this
merger, in terms of what we bring to its success and the equal
share of benefits we receive in recognition of our efforts.
"Completing the financial transaction is a moment of hope and
celebration. We congratulate Doug Parker and every employee of
our two airlines. And, we encourage management to lead an airline
where the front line workers are proud of where we work and who we
work with at every level of the airline. That will set us apart
and catapult us well above the rest of the industry -- only the
best for the world's biggest!
"Flight Attendants are ready. We have done our part and we will
redouble our efforts going forward. Our experience shows nearly
anything can be done when we stand together."
About The Association of Flight Attendants
The Association of Flight Attendants -- http://www.ouramerican.org
-- is the world's largest Flight Attendant union. Focused 100
percent on Flight Attendant issues, AFA has been the leader in
advancing the Flight Attendant profession for 68 years. Serving
as the voice for Flight Attendants in the workplace, in the
aviation industry, in the media and on Capitol Hill, AFA has
transformed the Flight Attendant profession by raising wages,
benefits and working conditions. US Airways Flight Attendants are
8,500 of the nearly 60,000 Flight Attendants who come together to
form AFA, in partnership with the 700,000-member strong
Communications Workers of America (CWA), AFL-CIO.
AMERICAN AIRLINES: APFA Welcomes Newly Merged Airline
-----------------------------------------------------
Hundreds of members of the Association of Professional Flight
Attendants, the union proudly representing the Flight Attendants
of American Airlines, were on hand on Dec. 9 to introduce the new
American to the flying public.
"Christmas has come early for the APFA," said union president
Laura Glading. "It's been a long, tough slog, but [Mon]day our
hard work has paid off. The Flight Attendants of the new American
are looking forward to building the world's greatest airline."
In a ceremony at American's headquarters near DFW, Flight
Attendants joined other frontline employees for a special ceremony
commemorating the merger with US Airways and the first day of
trading for the new American Airlines Group Inc. (ticker symbol
AAL) on the NASDAQ. The new American, the world's largest
airline, will offer consumers a third network carrier option to
compete with United and Delta.
APFA members are also looking forward to receiving their claim of
the new American's equity. The anticipated value of their share
is by far the highest in Flight Attendant history.
As a member of the unsecured creditors' committee during
American's bankruptcy, APFA led the charge in pushing for the
merger. After reaching a conditional labor agreement with US
Airways, APFA focused on explaining the benefits of the merger
plan to the other various creditors and convincing them to support
it as well. When the Justice Department challenged the merger
with an eleventh-hour antitrust suit, APFA took to Capitol Hill to
generate support for the deal.
As part of the labor agreement with US Airways, APFA prescribed a
clear and direct path to an industry-leading contract. The
agreement will soon bring American and US Airways Flight
Attendants together at the bargaining table to unite the groups
under a joint collective bargaining agreement that reflects the
size and competitiveness of the new American. Most importantly,
the agreement will allow the new American's Flight Attendants to
avoid the challenges and pitfalls that beset work groups during
previous airline mergers.
About APFA
The Association of Professional Flight Attendants, founded in
1977, represents the more than 16,000 active Flight Attendants at
American Airlines. In November 2011, American's parent company
filed for Chapter 11 bankruptcy protection. Throughout the
bankruptcy trial, APFA President Laura Glading served on the
Unsecured Creditors' Committee where she fiercely advocated for
American Flight Attendants. In December 2013, American and US
Airways finalized a merger between the two carriers. Achieving a
merger inside bankruptcy is unprecedented in the industry and
would not have occurred without APFA's efforts.
AMERICAN APPAREL: Comparable Sales for November 2013 Increased 1%
-----------------------------------------------------------------
American Apparel, Inc., announced preliminary sales for the month
of November 2013. On a preliminary basis, total net sales were
$49.2 million, a decrease of 1 percent over the prior year.
Comparable sales increased 1 percent, including a 1 percent
increase in comparable store sales in the retail store channel and
a 4 percent increase in net sales in the online channel.
Wholesale net sales decreased 4 percent for the month.
Dov Charney, Chairman and CEO, commented, "We are encouraged by
the momentum in comparable store sales particularly at the end of
the month, as we increased the efficiency and effectiveness of our
La Mirada distribution center and made improvements in our in-
stock store inventories. Our new distribution center is fully
operational and we have made significant progress in reducing the
operating cost of the center. Additionally, as we are able to
adjust our focus back to our core competencies surrounding
assortment and production planning and product development, we
expect to see a corresponding increase in sales in our stores.
"We saw meaningful sales strength in both our stores and online
business on Black Friday and the weekend following Thanksgiving.
We were also very encouraged by positive online sales growth on
Cyber Monday. However, given the shifts in timing of the
Thanksgiving holiday, Cyber Monday sales in 2013 will not be
recognized until December versus November last year. Finally the
modest decline in wholesale net sales is a result of the
comparison to an extraordinary sales increase last year, as last
November we shipped a significant stocking order from a major new
customer. Additionally, we had one extra shipping day for our
wholesale business last November.
"Following the ongoing success of American Apparel in Europe, we
are expanding our footprint and have just opened a shop-in-shop
inside De Bijenkorf, a high-end department store on Dam Square,
the main town square in Amsterdam. In addition, three new stores
are planned to open this holiday season in Lyon, France; Centro
Oberhausen in Oberhausen, Germany; and Westfield Stratford City in
Stratford, London."
A copy of the press release is available for free at:
http://is.gd/iXH9TP
About American Apparel
Los Angeles, Calif.-based American Apparel, Inc. (NYSE Amex: APP)
-- http://www.americanapparel.com/-- is a vertically integrated
manufacturer, distributor, and retailer of branded fashion basic
apparel. As of September 2010, American Apparel employed over
10,000 people and operated 278 retail stores in 20 countries,
including the United States, Canada, Mexico, Brazil, United
Kingdom, Ireland, Austria, Belgium, France, Germany, Italy, the
Netherlands, Spain, Sweden, Switzerland, Israel, Australia, Japan,
South Korea and China.
Amid liquidity problems and declining sales, American Apparel in
early 2011 reportedly tapped law firm Skadden, Arps, Slate,
Meagher & Flom and investment bank Rothschild Inc. for advice on a
restructuring.
In April 2011, American Apparel said it raised $14.9 million in
rescue financing from a group of investors led by Canadian
financier Michael Serruya and private equity firm Delavaco Capital
Corp., allowing the casual clothing retailer to meet obligations
to its lenders for the time being. Under the deal, the investors
were buying 15.8 million shares of common stock at 90 cents
apiece. The deal allows the investors to purchase additional
27.4 million shares at the same price.
The Company incurred a net loss of $37.27 million in 2012, as
compared with a net loss of $39.31 million in 2011. The Company's
balance sheet at Sept. 30, 2013, showed $332.93 million in total
assets, $389.12 million in total liabilities and a $56.19 million
total stockholders' deficit.
* * *
American Apparel carries a Caa1 Corporate Family Rating from
Moody's Investors Service and a 'B-' corporate credit rating from
Standard & Poor's Ratings Services.
AMERICAN FIRST: S&P Assigns 'B-' ICR & Rates $55MM Notes 'B-'
-------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its 'B-'
issuer credit rating on American First Financial Group Inc.
(AFFG). The outlook is stable. S&P also assigned a 'B-' issue
rating on AFFG's proposed issuance of $55 million of senior
unsecured notes.
Portage, Mich.-based AFFG is a privately held nonoperating holding
company created in June 2013 to acquire the operations of
AmeriFirst Financial Corp. through a leveraged buyout. AmeriFirst
is a mortgage origination and servicing company that began
operations in 1987. AFFG employs 296 individuals and operates 53
branches in the Midwest and southern U.S., although the company is
heavily concentrated in Michigan, Ohio, and Indiana. AFFG
originates conventional conforming loans, which it sells to Fannie
Mae, and nonconventional Federal Housing Administration, Veterans
Administration, and U.S. Department of Agriculture Rural
Development mortgages, which are sold to Ginnie Mae. When loans
are sold, AFFG retains the mortgage servicing rights (MSRs).
American First will use the proceeds from the $55 million proposed
debt issuance to buy an 80% stake from existing shareholders--a
leveraged buyout. As a result of this transaction, and the
recognition of about $45 million in goodwill, the company will
have a $17 million deficiency in tangible equity. Therefore, S&P
measures AFFG's leverage on an earnings basis since the value of
the enterprise is primarily the business model and infrastructure,
and not the company's assets.
"Our rating on AFFG balances its geographic and business
concentration against its strategy of acquiring smaller regional
originators, which helps the company diversify its revenues," said
Standard & Poor's credit analyst Stephen Lynch. In 2012 and 2013,
about 60% of the company's revenue from originations came from
Michigan. Indiana and Ohio accounted for about 18% and 10%,
respectively, and the remaining 12% was divided among seven other
states. The geographic concentration is a negative rating factor.
Nonetheless, AFFG has used the changing regulatory conditions and
superior access to government-sponsored entities (GSEs) to partner
with and then acquire smaller competitors, which diversifies the
company's revenue. AFFG, by virtue of size and scale, offers
better price execution on loans because of its access to GSE
windows, compared with smaller competitors who rely on third-party
aggregators. The relative size and scale also reduce the cost of
compliance with state, federal, and GSE lending guidelines and
procedures.
The outlook is stable. AFFG has a track record of navigating
turbulent economic and housing market conditions, which S&P
believes supports its ratings stability. S&P could lower the
rating if leverage failed to show steady improvement through
strong earnings growth. S&P could raise the rating if the company
reduces its leverage by paying down debt from operating earnings.
An upgrade, however, would also require some additional revenue
and geographic diversification.
APPLIED MINERALS: Stockholders Elect Five Directors
---------------------------------------------------
At Applied Minerals, Inc.'s annual meeting of stockholders which
was held on Dec. 5, 2013, Mario Concha, John Levy, Evan Stone,
David Taft, and Andre Zeitoun were elected as directors. The
stockholders approved, on a non-binding basis, executive
compensation and ratified the appointment of EisnerAmper LLP as
the Company's independent registered public accounting firm.
About Applied Minerals
New York City-based Applied Minerals, Inc. (OTC BB: AMNL) is a
leading global producer of halloysite clay used in the development
of advanced polymer, catalytic, environmental remediation, and
controlled release applications. The Company operates the Dragon
Mine located in Juab County, Utah, the only commercial source of
halloysite clay in the western hemisphere. Halloysite is an
aluminosilicate clay that forms naturally occurring nanotubes.
Applied Minerals incurred a net loss of $9.73 million in 2012 as
compared with a net loss of $7.43 million in 2011. The Company's
balance sheet at Sept. 30, 2013, showed $16.90 million in total
assets, $13.25 million in total liabilities and $3.64 million in
total stockholders' equity.
Bankruptcy Warning
"The Company has had to rely mainly on cash flow generated from
the sale of stock and convertible debt to fund its operations. If
the Company is unable to fund its operations through the
commercialization of its minerals at the Dragon Mine, it may have
to file bankruptcy, as there is no assurance of the foregoing,"
the company said in its annual report for the year ended Dec. 31,
2012.
APPLIED MINERALS: Signs Distribution Agreement with Mitsui
----------------------------------------------------------
Applied Minerals, Inc., has signed an agreement with Mitsui
Plastics, Inc., that grants Mitsui Plastics the right to
distribute the Company's DragoniteTM Halloysite Clay on a non-
exclusive basis. This agreement follows the Memorandum of
Understanding that had been signed by the Company and Mitsui in
June 2013.
Mitsui Plastics, Inc., utilizes an extensive international sales
force, operating out of 155 offices located in 69 countries, to
distribute of a full range of plastics and plastic additives,
modifiers, and advanced materials to plastics customers worldwide.
Per the terms of the agreement, Mitsui Plastics will have the
right to distribute Dragonite in Europe, the Middle East, Africa,
Asia, South America, and Central America.
Andre Zeitoun, CEO of Applied Minerals, commented, "We are excited
by the potential of this distribution agreement with Mitsui
Plastics and are emboldened by the fact that such a leading global
organization has decided to distribute Dragonite Halloysite Clay."
Mr. Zeitoun continued, "Our relationship with Mitsui Plastics will
help us accelerate the penetration of Dragonite into the advanced
filler, nucleating agent and flame retardant markets.
We look forward to capitalizing on the attractive opportunities
this agreement provides us."
Meanwhile, the Company filed with the U.S. Securities and Exchange
Commission an investor presentation used at the Company's Annual
Meeting of Shareholders on Dec. 5, 2013, a copy of which is
available for free http://is.gd/cjthYM
About Applied Minerals
New York City-based Applied Minerals, Inc. (OTC BB: AMNL) is a
leading global producer of halloysite clay used in the development
of advanced polymer, catalytic, environmental remediation, and
controlled release applications. The Company operates the Dragon
Mine located in Juab County, Utah, the only commercial source of
halloysite clay in the western hemisphere. Halloysite is an
aluminosilicate clay that forms naturally occurring nanotubes.
The Company reported a net loss attributable to the Company of
$7.48 million in 2011, a net loss attributable to the Company of
$4.76 million in 2010, and a net loss attributable to the Company
of $6.76 million in 2009.
The Company's balance sheet at March 31, 2013, showed
$10.52 million in total assets, $2.75 million in total
liabilities, and $7.77 million in total stockholders' equity.
Going Concern
The Company has incurred material recurring losses from
operations. At March 31, 2012, the Company had a total
accumulated deficit of approximately $43,084,500. For the three
months ended March 31, 2012, and 2011, the Company sustained net
losses from exploration stage before discontinued operations of
approximately $4,056,700 and $1,695,100, respectively. The
Company said that these factors indicate that it may be unable to
continue as a going concern for a reasonable period of time. The
Company's continuation as a going concern is contingent upon its
ability to generate revenue and cash flow to meet its obligations
on a timely basis and management's ability to raise financing or
dispose of certain non-core assets as required. If successful,
this will mitigate the factors that raise substantial doubt about
the Company's ability to continue as a going concern.
Bankruptcy Warning
At Dec. 31, 2011, and 2010, the Company had accumulated deficits
of $39,183,632 and $31,543,411, respectively, in addition to
limited cash and unprofitable operations. For the year ended
Dec. 31, 2011, and 2010, the Company sustained net losses before
discontinued operations of $7,476,864 and $4,891,525,
respectively. As of March 15, 2012, the Company has not
commercialized the Dragon Mine and has had to rely on cash flow
generated from the sale of stock and convertible debt to fund its
operations. If the Company is unable to fund its operations
through the commercialization of the Dragon Mine, the sale of
equity or debt or a combination of both, it may have to file
bankruptcy.
AQUILEX INTERMEDIATE: S&P Assigns 'B' Corp. Credit Rating
---------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' corporate
credit rating to Aquilex Intermediate Holdings LLC. The outlook
is stable.
At the same time, based on preliminary terms and conditions, S&P
assigned a 'B' issue-level rating (the same as the corporate
credit rating) and a recovery rating of '3' to the proposed
$300 million first-lien senior secured facility under which the
co-borrowers will be Aquilex LLC and Aquilex Corporate Holdings
LLC. The '3' recovery rating indicates S&P's expectation of
meaningful (50% to 70%) recovery in the event of payment default.
The facility consists of a $50 million revolving credit facility
due 2019 and a $250 million first-lien term loan due 2020.
Aquilex plans to use the new credit facilities for the acquisition
and to refinance existing debt.
"The ratings on Aquilex reflect our assessment of its business
risk profile as 'weak' and its financial risk profile as 'highly
leveraged'," said Standard & Poor's cedit analyst Pranay Sonalkar.
We assess its management and strategy as "fair".
S&P's assessment of a weak business risk profile reflects key
risks, including significant customer concentration with the top
10 customers accounting for 47% of revenues, narrow scope of
operations, high exposure to cyclical petrochemical and refiner
end markets, and integration risks. These factors are the primary
drivers of S&P's weak competitive position score. In addition,
seasonal demand for turnaround services requires the company to
ramp up and down its labor face, which increases operational risks
including safety. Furthermore, the fragmented nature of the
industry limits Aquilex's pricing power. These factors are
partially offset by the recurring nature of revenues, which
provides earnings and cash flow stability; long-standing
relationships with customers; co-located facilities on customer
sites; and development of automation technology. In addition, the
merger, if executed successfully, increases Aquilex's scale and
will enable it to improve operations and strengthen its position
relative to its competitors. The company should achieve and
maintain satisfactory EBITDA margins. Margins at the current
level have a short history and have been volatile in the past but
we expect them to be sustainable given recently implemented
management and operational changes.
"Our assessment of a highly leveraged financial risk profile
reflects Aquilex's very aggressive financial policies given its
ownership by financial sponsors. Although we do not expect the
equity sponsors to increase Aquilex's debt leverage substantially
in the near term, we believe that debt is likely to eventually
increase as the equity sponsors seek to maximize the value of
their investment. Pro forma for the financing transaction, we
expect funds from operations (FFO) to total adjusted debt of about
17.2% in 2013 and total adjusted debt to EBITDA of around 4.4x.
We adjust debt to include about $19 million of operating leases.
We expect the company to generate about $18 million to $22 million
of free cash flow annually in 2013 and 2014, which we anticipate
it will use for shareholder rewards and a small amount for debt
reduction," S&P said.
The outlook is stable. S&P expects the company to successfully
integrate the Inland acquisition, maintain satisfactory operating
profitability, and generate sufficient free cash flow to support a
financial profile consistent with the ratings. S&P's expectations
at the current rating include FFO to debt of at least 7% and
sufficient availability under its revolver.
AQUILEX LLC: Moody's Assigns 'B2' CFR & Rates $50MM Notes 'B2'
--------------------------------------------------------------
Moody's Investors Service assigned Aquilex LLC a B2 Corporate
Family Rating (CFR) and a B2-PD Probability of Default rating. The
rating agency also assigned a B2 rating to the company's proposed
$50 million senior secured revolving credit facility and to its
$250 million senior secured term loan. The rating outlook is
stable. Proceeds will be used to acquire Inland Industrial Service
Group, LLC, ("Inland") and refinance Aquilex's existing debt.
Ratings:
Corporate Family : Assigned B2
Probability of Default: Assigned B2-PD
$50 million Senior Secured Revolving Credit Facility due December
2019: Assigned B2/LGD3-48%
$250 million Senior Secured Term Loan due December 2020: Assigned
B2/LGD3-48%
Rating Outlook: Stable
Aquilex's B2 CFR reflects the high pro forma leverage and
integration risks that will result from the company's acquisition
of Inland, offset by the strategic logic and potential benefits of
the transaction. Aquilex has a very competitive position in the US
industrial cleaning market. In addition, newly installed senior
management has established a more focused business strategy and is
implementing new operating disciplines. Inland's business model,
geographic footprint and customer base complements that of
Aquilex, and the acquisition has the potential to yield meaningful
strategic and operating benefits. Despite these potential
benefits, the transaction poses financial and operating risks. Pro
forma for the acquisition, Aquilex's leverage will approximate a
moderately high 4.4x, and free cash flow to debt will be about 9%.
Moody's also notes that the transaction will almost double
Aquilex's size. Despite the operating capabilities of Aquilex's
management team and the strategic fit with Inland, a transaction
of this size will pose integration risk. In addition, the
transaction comes less than two years of the start of Aquilex's
management team retooling. The relatively tight time frame of
these events could add to the integration risks.
Aquilex utilizes technology-driven solutions improve margins and
increase worker safety, leading to a better than average accident
ratio in recent years. Aquilex and Inland's market presence
complement each other and cross-selling and cost reducing
opportunities exist through sharing of technology and processes.
Moody's anticipates additional acquisitions over time as the
company acquires regional competitors, while management remains
mindful of maintaining the current financial profile in the
process.
Moody's views liquidity as good as a result of the expectation for
sustained positive free cash flow, near full revolver
availability, and generous room under covenants. The pledge of all
assets to the bank debt limits alternative liquidity.
The stable outlook reflects low single digit percent revenue
growth as industrial cleaning demand should grow at the same rate
as US GDP. Moody's expects modest cost improvements in 2014
leading to fairly unchanged margins compared to the pro-forma
twelve months ending September 2013. Debt reduction is expected to
be limited to 1% term loan amortization ($2.5 million annually)
and repayment of the modest post-closing revolver draw ($8
million).
Leverage below 4.0x and free cash flow generation to debt in the
mid teen percentage on a sustained basis, as well as acquisition
activity below $50 million could lead to higher ratings. Poor
integration of Inland leading to leverage exceeding 5.0x, free
cash flow to debt declining near 0%, or liquidity declining to $25
million could lead to lower ratings.
Aquilex is a leading provider of industrial cleaning in the US,
with extra focus on the chemical, refinery, and other industries.
The company has been majority owned by funds affiliated with
Centerbridge Partners, as well as minority ownership by other
private equity firms and management, since the company's
recapitalization in 2012. Pro-forma for the Inland acquisition,
revenue in the twelve months ending September 30, 2013, was about
$380 million.
ASG CONSOLIDATED: S&P Raises Rating on Sr. Subordinated Notes to B
------------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B-' corporate
credit rating on Seattle, Wash.-based ASG Consolidated LLC, and
revised the outlook to negative from stable.
At the same time, S&P raised the issue-level rating on the
company's senior subordinated notes to 'B' from 'B-', and revised
the recovery rating to '2' from '3', indicating that lenders could
expect substantial (70% to 90%) recovery in the event of a payment
default. The higher recovery rating reflects the company's recent
$29.1 million paydown in senior secured debt, providing additional
recovery value for subordinated note holders.
"The outlook revision reflects our belief that ASG will have
difficulty complying with its financial covenants over the near
term, given its weaker-than-expected operating performance and
continued tight covenant cushion," said Standard & Poor's credit
analyst Jeff Burian. "As a result, we believe that the company's
liquidity position may weaken and that it may not be able to
remain in compliance with its covenants during the next two
quarters when covenant levels become more restrictive."
ASG is a vertically integrated seafood harvesting, processing, and
marketing company that operates catcher-processor vessels that
participate in the largest commercial fishery in U.S. waters. The
ratings on ASG reflect Standard & Poor's view that the company's
financial risk profile is "highly leveraged" and its business risk
profile is "weak."
S&P could consider revising the outlook to stable if the company
is able to develop a credible plan to restore and sustain covenant
cushion levels to at least 15% through improved EBITDA or an
amendment of its covenant test levels.
ASPEN GROUP: Presented at LD Micro Conference
---------------------------------------------
Michael Mathews, the chief executive officer and Chairman of Aspen
Group, Inc., gave a presentation at the LD Micro Conference on
Dec. 4, 2013. The PowerPoint presentation which was displayed at
the meeting is available for free at http://is.gd/LE1Zm3
About Aspen Group
Denver, Colo.-based Aspen Group, Inc., was founded in Colorado in
1987 as the International School of Information Management. On
Sept. 30, 2004, it was acquired by Higher Education Management
Group, Inc., and changed its name to Aspen University Inc. On
May 13, 2011, the Company formed in Colorado a subsidiary, Aspen
University Marketing, LLC, which is currently inactive. On
March 13, 2012, the Company was recapitalized in a reverse merger.
Aspen's mission is to become an institution of choice for adult
learners by offering cost-effective, comprehensive, and relevant
online education. Approximately 88 percent of the Company's
degree-seeking students (as of June 30, 2012) were enrolled in
graduate degree programs (Master or Doctorate degree program).
Since 1993, the Company has been nationally accredited by the
Distance Education and Training Council, a national accrediting
agency recognized by the U.S. Department of Education.
The Company reported a net loss of $6.01 million on $2.68 million
of revenues for the year ended Dec. 31, 2012, as compared with a
net loss of $2.13 million on $2.34 million of revenues during the
prior year. The Company's balance sheet at July 31, 2013, showed
$3.77 million in total assets, $3.96 million in total liabilities
and a $194,085 total stockholders' deficiency.
Salberg & Company, P.A., in Boca Raton, Florida, issued a "going
concern" qualification on the consolidated financial statements
for the transition period ending April 30, 2013. The independent
auditors noted that the Company has a net loss allocable to common
stockholders and net cash used in operating activities for the
four months ended April 30, 2013, of $1,402,982 and $918,941,
respectively, and has an accumulated deficit of $12,740,086 at
April 30, 2013. These matters raise substantial doubt about the
Company's ability to continue as a going concern.
ATLANTIC COAST: FJ Capital Held 8.2% Equity Stake at Nov. 27
------------------------------------------------------------
In a Schedule 13G filed with the U.S. Securities and Exchange
Commission, FJ Capital Management and its affiliates disclosed
that as of Nov. 27, 2013, they beneficially owned 1,275,600 shares
of common stock of Atlantic Coast Financial Corporation
representing 8.22 percent of the shares outstanding. A copy of
the regulatory filing is available for free at http://is.gd/9ZYKex
About Atlantic Coast
Jacksonville, Florida-based Atlantic Coast Financial Corporation
is the holding company for Atlantic Coast Bank, a federally
chartered and insured stock savings bank. It is a community-
oriented financial institution serving northeastern Florida and
southeastern Georgia markets through 12 locations, with a focus on
the Jacksonville metropolitan area.
The Company reported a net loss of $6.66 million on $33.50 million
of total interest and dividend income for the year ended Dec. 31,
2012, as compared with a net loss of $10.28 million on $38.28
million of total interest and dividend income in 2011. Total
assets were $714.1 million at Sept. 30, 2013, compared
with $772.6 million at Dec. 31, 2012, as the Company has
continued to manage asset size consistent with its overall
capital management strategy.
As of Sept. 30, 2013, Atlantic Coast had $714.11 million in total
assets, $684.23 million in total liabilities and $29.87 million in
total stockholders' equity.
McGladrey LLP, in Jacksonville, Florida, issued a "going concern"
qualification on the consolidated financial statements for the
year ended Dec. 31, 2012. The independent auditors noted that the
Company has suffered recurring losses from operations that have
adversely impacted capital at Atlantic Coast Bank. The failure to
comply with the regulatory consent order may result in Atlantic
Coast Bank being deemed undercapitalized for purposes of the
consent order and additional corrective actions being imposed that
could adversely impact the Company's operations. This raises
substantial doubt about the Company's ability to continue as a
going concern.
BENTLEY PREMIER: 2 Owners File Rival Bankruptcy-Exit Plans
----------------------------------------------------------
The two owners of Bentley Premier Builders, LLC, are at odds and
have each filed a proposed reorganization plan for the Texas real
estate developer.
Sandy Golgart, 50% equity owner and manager of the Debtor, filed a
reorganization plan that proposes to transfer cash, lots, homes
and a contract on the commercial lot, as well as proceeds from the
closing of the contract, to Starside LLC and Pourchot Trust in
full satisfaction of their claims. Golgart managed the affairs of
the Debtor before a Chapter 11 trustee was appointed in September
2013.
The other 50% owner -- The Phillip M. Pourchot Revocable Trust --
along with unit Starside, LLC, has proposed a Chapter 11 plan that
contemplates payment of creditors in full and the completion of
ongoing construction jobs through the infusion of the necessary
capital from Starside and the Pourchot Trust. Under the Trust's
Plan, Bentley will emerge with only one owner -- the successful
bidder at an auction to be held at or before the confirmation
hearing. Absent a third-party, Pourchot will end up taking
control of the company as Pourchot and Starside intend to credit
bid up to the combined amount of their secured claim. Pourchot
claims to be owed at least $26.4 million from the Debtor through
cash advances made in 2008 through 2012. Starside, an entity
owned by Pourchot, claims to be owed $6.23 million after acquiring
the interests of Sovereign Bank on a promissory note.
The two factions differ on the valuation of the Debtor's assets
and the amount of Pourchot's claims. Golgart's Plan says the
Debtor's properties have a fair market value in excess of $36
million and the maximum amount of the secured debt is $18 million,
thus leaving substantial equity in the Debtor's properties.
Pourchot's plan says the present value of the Debtor's real estate
assets is just $23 million to $27 million, and the secured claims
of Pourchot and Starside are at least $29.2 million -- thus equity
is out of the money, and Golgart would be wiped out.
Golgart's plan would allow Golgart to maintain control of the
Debtor. If Pourchot's plan is approved, Pourchot will likely grab
control of the company as the plan would allow it to submit a
credit bid for the assets.
Pourchot Plan
Pourchot believes that the present value of the Debtor's real
estate assets is $23 million to 27 million. The Pourchot Plan
says equity is out of the money. Starside and the Pourchot Trust
assert secured claims of at least $29.2 million; subcontractors
have asserted mechanic's lien claims under state law; ad valorem
real property taxes for 2012 are past due, and taxes for 2013 will
need to be paid; and Pourchot believes general unsecured claims
will exceed the Debtor's initial estimate of $250,000.
Because equity is out of the money, old equity will be cancelled,
and new equity will be issued under the Plan. Pourchot intends to
auction off the Reorganized Debtor's new equity to the highest and
best bidder under bid procedures to be approved by the Bankruptcy
Court. Pourchot will seek approval of credit bid rights that will
include the aggregate of their allowed secured claims, the
administrative expense claims for postpetition lending and the
amounts they are committed to advance under the Plan.
Pourchot says it has already agreed to a substantial reduction to
its allowed secured claim if its Plan is confirmed.
Under Pourchot's Plan:
* Starside's $6.2 million secured claim will be paid in full.
Unless a successful bidder outbids the secured lenders at the
auction, the claim will be satisfied by a new note with 5%
interest per annum and maturing on the first anniversary of the
effective date of the Plan. Starside is impaired under the Plan.
* The Pourchot Trust's $23 million secured claim will have a
58.9% recovery. Unless a successful bidder outbids the secured
lenders at the auction, the claim will be satisfied by a new note
with 5% interest per annum and maturing on the first anniversary
of the effective date of the Plan.
* Holders of secured mechanic's lien claims will recover 100%,
although they are still impaired. The reorganized debtor will pay
the invoiced amounts (without interest and fees) of
subcontractors.
* Holders of unsecured subcontractor claims will recover 100%,
although the claims are still impaired under the Plan. The
Reorganized Debtor will pay all invoices presented by a
Subcontractor (without interest or fee) in three equal
installments.
* Holders of general unsecured claims will recover 100%,
although the claims are still impaired under the Plan. They will
receive full payment in cash, without interest or fees.
* All existing equity interests in the Debtor will be
cancelled.
A copy of Pourchot's Disclosure Statement dated Dec. 6, 2013, is
available for free at:
http://bankrupt.com/misc/Bentley_Premier_Starside_DS.pdf
Golgart Plan
Under the Golgart Plan:
* The Starside Note is oversecured and therefore payment in
full will release many lots from the Starside lien.
* The Pourchot Trust Note is undersecured, but the Debtor
intends to treat the claim as fully secured. The Debtor will
transfer to Pourchot Trust all of the lots securing this debt and
several of the lots released from the Starside lien with
sufficient value to pay the entire allowed Pourchot Trust claim.
* Following the transfer of the lots, the Debtor will retain
at least a dozen unencumbered lots and a model home, collectively
valued at $4,845,000. The Debtor will retain existing contracts
to support the Debtor's ongoing operation.
* The Debtor has accounts receivable in sufficient amount to
pay the allowed administrative fees of the U.S. Trustee, the
Chapter 11 trustee and the Debtor's counsel.
* The Debtor will pay allowed unsecured claims in full within 6
months of the effective date.
* Golgart will remain and be confirmed as managing member of
the Reorganized Debtor.
* Pourchot would be released from all claims asserted against
him by the Debtor if he votes in favor of the Plan and does not
oppose confirmation.
A hearing to consider approval of the disclosure statement
explaining Golgart's plan is slated for Jan. 21, 2014, at 9:30
a.m. Objections are due Jan. 14.
A copy of the Golgart's Disclosure Statement dated Nov. 27, 2013,
is available for free at:
http://bankrupt.com/misc/Bentley_Premier_Golgart_DS.pdf
Use of Cash Collateral
To stabilize and maintain the Debtor's operations while in
bankruptcy, the Pourchot Trust and Starside, as secured lenders,
consented to the Trustee's use of cash collateral and agreed to
finance the Trustee's postpetition operations.
On Nov. 25, 2013, the Bankruptcy Court entered an agreed order
authorizing the terms of such cash collateral use and postpetition
financing. The order authorized the Trustee to use funds held in
an escrow account to pay budgeted expenses and granted the
Pourchot Trust a lien on six additional lots and a priority claim
to ensure repayment of the amounts used from that escrow account
or otherwise advanced by the Pourchot Trust postpetition. As part
of that order, the Trustee was given 30 days from the entry of the
order to challenge the Pourchot Trust's secured claim.
While the parties have engaged in discussions over the proper
characterization of the claim, the Pourchot Trust maintains that
its claim is properly characterized as debt.
About Bentley Premier
Bentley Premier Builders, LLC, is a Texas limited liability
company in the business of selling high-end residential lots and
building high-quality luxury homes. The Debtor owns and develops
lots, primarily in the two subdivisions known as Normandy Estates,
which straddles both Denton and Collin Counties, near the
intersection of Spring Creek Parkway and Midway Road in Plano, and
Wyndsor Pointe, which is located in Frisco off Stonebrook Parkway,
one-half mile west of the Dallas North Tollway. The company has
100 vacant residential lots, with listing prices ranging from
$150,000 to $900,000. In addition to these vacant lots, the
company owns a model house and an Amenities Center in Normandy
Estates, two houses in Wyndsor Pointe, some common areas and an
approximately 5-acre tract zoned for commercial use.
Bentley filed a Chapter 11 petition (Bankr. E.D. Tex. Case No.
13-41940) on Aug. 6, 2013 in Sherman, Texas. The Debtor disclosed
$35,793,857 in assets and $30,428,782 in liabilities as of the
Chapter 11 filing.
The Phillip M. Pourchot Revocable Trust (led by co-trustee Phillip
M. Pourchot) and Sandy Golgart each hold a 50% member's interest
in the Debtor. Ms. Golgart signed the bankruptcy petition.
The Debtor sought bankruptcy after Starside LLC, an entity owned
by Phillip Pourchot, acquired the note issued to Sovereign Bank
for a $7,250,000 loan, and served notice of its attempt to
foreclose upon properties securing the note.
Gerald P. Urbach, Esq., and Jason A. Katz, Esq., at Hiersche,
Hayward, Drakeley & Urbach, P.C., in Addison, Texas, serve as the
Debtor's counsel.
Judge Brenda Rhoades presides over the case.
A chapter 11 trustee was appointed following motions filed by the
U.S. Trustee and the Pourchot Trust. Jason R. Searcy, the Chapter
11 trustee, tapped to employ Joshua P. Searcy, Esq., at Searcy &
Searcy, P.C. as attorneys, and Gollob, Morgan, Peddy & Co., P.C.,
as accountants.
Starside and Pourchot are represented by:
Nathan Allen, Jr., Esq.
Laura L. Worsham, Esq.
Lynn W. Schleinat, Esq.
JONES, ALLEN & FUQUAY, LLP
8828 Greenville Avenue
Dallas, TX 75243
Tel: (214) 343-7400
Fax: (214) 343-7455
- and -
Mark E. Andrews, Esq.
Aaron M. Kaufman, Esq.
COX SMITH MATTHEWS INCORPORATED
1201 Elm Street, Suite 3300
Dallas, Texas 75270
Tel: (214) 698-7800
Fax: (214) 698-7899
The deadline to file claims against and interest in the Debtor
expired Dec. 5, 2013. Governmental entities have until Feb. 3,
2014, to file proofs of claim.
BIOVEST INTERNATIONAL: Taps Robert Farrell as CFO
-------------------------------------------------
Biovest International, Inc., hired Robert Farrell as chief
financial officer of the Company effective Dec. 1, 2013. Prior to
Mr. Farrell's hiring, Brian Bottjer had been serving as acting
chief financial officer and controller of the Company. Mr.
Bottjer will continue to serve as controller of the Company.
Before Mr. Farrell's appointment as chief financial officer of the
Company, he served as chief financial officer of Sanovas, Inc., a
medical device company from 2012 to 2013. Prior to that, Mr.
Farrell was employed by Titan Pharmaceuticals, Inc., a diversified
public biotechnology company, where he served as president and
chief executive officer from 2008 to 2010 and as executive vice
president and chief financial officer from 1996 to 2008. From
1990 to 1996, Mr. Farrell served as Corporate Group vice president
and chief financial officer of Fresenius USA. From 1982 to 1990
Mr. Farrell was employed by Genstar Corporation, serving as vice
president of Marketing within Genstar's Financial Services
Division from 1982 to 1989, and as president of TXL Securities
from 1987 to 1990. Mr. Farrell also served as associate general
counsel of Brae Corporation from 1979 to 1982 and as an Associate
Attorney for Crane & Hawkins from 1977 to 1979. Mr. Farrell
received a J.D. from University of California, Hastings College of
Law and a Bachelor of Arts degree in Government and Economics with
a Minor in Accounting from University of Notre Dame. Mr. Farrell
is a Member of the California Bar. Mr. Farrell is 63.
Effective Dec. 1, 2013, the Company and Mr. Farrell entered into
an Employment Agreement providing for Mr. Farrell's employment as
chief financial officer of the Company for a term of one year with
a base salary of $250,000 per year. Mr. Farrell's base salary may
be adjusted from time to time, in accordance with other employees
or executives, in the discretion of the Company's Board of
Directors or the Compensation Committee thereof. Mr. Farrell will
also be entitled to a bonus in an amount equal to 50 percent of
his base salary upon the closing of any debt or equity financings
resulting in aggregate gross proceeds to the Company in an amount
equal to or greater than $5 million.
A copy of the Employment Agreement is available for free at:
http://is.gd/SscqzG
About Biovest International
Biovest International, Inc. -- http://www.biovest.com/-- is an
emerging leader in the field of active personalized
immunotherapies. In collaboration with the National Cancer
Institute, Biovest has developed a patient-specific, cancer
vaccine, BiovaxID(R), with three clinical trials completed,
including a Phase III study, demonstrating evidence of safety and
efficacy for the treatment of indolent follicular non-Hodgkin's
lymphoma.
Headquartered in Tampa, Florida, with its bio-manufacturing
facility based in Minneapolis, Minnesota, Biovest is publicly-
traded on the OTCQB(TM) Market with the stock-ticker symbol
"BVTI", and is a majority-owned subsidiary of Accentia
Biopharmaceuticals, Inc. (OTCQB: "ABPI").
Biovest, along with its subsidiaries, Biovax, Inc., AutovaxID,
Inc., Biolender, LLC, and Biolender II, LLC, filed for Chapter 11
bankruptcy protection (Bankr. M.D. Fla. Case No. 08-17796) on
Nov. 10, 2008. Biovest emerged from Chapter 11 protection, and
its reorganization plan became effective, on Nov. 17, 2010.
Biovest International Inc., filed a petition for Chapter 11
reorganization (Bankr. M.D. Fla. Case No. 13-02892) on March 6,
2013, in Tampa, Florida. The new bankruptcy case was accompanied
by a proposed reorganization plan supported by secured lenders
owed about $38.5 million. Total debt is $44.9 million, with
assets listed in a court filing as being valued at $4.7 million.
About $5.4 million is owing to unsecured creditors, according to a
court paper.
Biovest has successfully emerged from Chapter 11 reorganization
effective on July 9, 2013.
The Company's balance sheet at June 30, 2013, showed $5.92 million
in total assets, $49.11 million in total liabilities and a $43.18
million total stockholders' deficit.
BLUESTEM BRANDS: S&P Affirms 'B' CCR Over Upsized Term Loan
-----------------------------------------------------------
Standard & Poor's Ratings Services said its ratings and outlook on
Bluestem Brands Inc. are not affected by a $25 million increase of
the company's term loan B to $225 million.
The company has stated that it will use the proceeds from the term
loan, along with cash, to fund approximately $365 million dividend
to its preferred and common shareholders.
Although recovery prospects for the term loan lenders diminish
somewhat because of the facility upsize, the recovery rating on
that debt instrument remains '3', indicating S&P's expectation of
meaningful (50%-70%) recovery of principal in the event of a
payment default.
Pro forma for the term loan upsize, S&P calculates total debt to
EBITDA increases to about 5x at year-end 2013 from about 4.7x
before the term loan upsize.
RATINGS LIST
Bluestem Brands Inc.
Corporate Credit Rating B/Stable/--
$225M term loan B B
Recovery Rating 3
BOREAL WATER: Reports Non-Reliance on Previously Issued Reports
---------------------------------------------------------------
Boreal Water Collection, Inc., filed with the U.S. Securities and
Exchange Commission a Form 8-K in response to a request by the
staff of the SEC in a comment letter dated Nov. 19, 2013.
The Company received its first comment letter from the Staff on
Sept. 5, 2012, containing, among other things, a statement that
the Company is a smaller reporting company and should disclose its
financial information accordingly. It also asked the Company to
add cash equivalents, make more risk disclosure regarding a
license agreement, had questions about the Company's cash balance
and asked the Company to reconcile stock based compensation.
There were comments concerning the Company's treatment of foreign
currency translation, revenue recognition, long lived assets,
comprehensive income, stock based compensation, valuation of
instruments, property and equipment, stockholders' equity, income
taxes, short term debt, acquisition and litigation. Over time, as
the Company continued to amend its Form 10, the number of comments
dwindled to the point where the Company's last comment letter of
Nov. 19, 2013, mentioned the Company's financial statements only
to the point of requesting the filing of a current report on Form
8-K.
The financial statements in the Company's Form 10 filed on Aug. 6,
2012, and amended Forms 10s dated Oct. 9, 2012; Oct. 12, 2012;
Jan. 22, 2013; March 8, 2013, April 16, 2013, and Aug. 12, 2013,
can no longer be relied upon.
The financial statements in the Company's Form 10-K for the period
ending Dec. 31, 2012, filed on April 16, 2013, and in the
Company's amended Form 10-K filed on Aug. 12, 2013, can no longer
be relied upon.
A copy of the Form 8-K is available for free at:
http://is.gd/1FuBgr
About Boreal Water
Kiamesha Lake, N.Y.-based Boreal Water Collection, Inc., is a
personalized bottled water company specializing in premium custom
bottled water.
The Company reported a net loss of $822,902 on $2.7 million of
sales in 2012, compared with a net loss of $1.3 million on
$2.7 million of sales in 2011. The Company's balance sheet at
Sept. 30, 2013, showed $3.58 million in total assets, $2.66
million in total liabilities and $918,250 in total stockholders'
equity.
In the auditors's report accompanying the consolidated financial
statements for the year ended Dec. 31, 2012, Patrick Rodgers, CPA,
PA, in Altamonte Springs, Florida, expressed substantial doubt
about Boreal Water's ability to continue as a going concern. Mr.
Rodgers noted that the Company has a minimum cash balance
available for payment of ongoing operating expenses, has
experienced losses operations since inception, and it does not
have a source of revenue sufficient to cover its operating costs.
BRENNAN'S INC: Restaurant in New Orleans Is Liquidating
-------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Brennan's, the famed restaurant in the New Orleans
French Quarter, is being liquidated in Chapter 7 bankruptcy.
According to the report, creditors including an affiliate of Sysco
Corp. filed an involuntary bankruptcy petition on Oct. 28. The
restaurant, at 417 Royal Street, didn't oppose the petition.
Consequently, the bankruptcy judge declared the restaurant a
Chapter 7 bankrupt on Dec. 5.
Ronald Hof will serve as trustee unless creditors elect a trustee
of their own to liquidate the assets.
The almost 70-year-old restaurant was in the midst of intra-family
disputes. Ted Brennan was removed as president in June. He had an
appeal pending in the U.S. Court of Appeals in New Orleans seeking
reinstatement. He failed to persuade the bankruptcy judge to delay
bankruptcy until the appeals court handed down a decision.
The restaurant claimed to be the inventor of the dessert Bananas
Foster.
Felix's Restaurant & Oyster Bar, also in the New Orleans's French
Quarter, was liquidated in bankruptcy last year.
Lists of Brennan's assets are yet to be filed, so it's unclear
whether the trustee will able to sell the name or the restaurant
itself.
The case is In re Brennan's Inc., 13-bk-12985, U.S. Bankruptcy
Court, Eastern District of Louisiana (New Orleans).
BUILDERS FIRSTSOURCE: Amends 24.8MM Shares Resale Prospectus
------------------------------------------------------------
Builders Firstsource, Inc., amended its registration statement on
Form S-3 relating to the resale by certain of the Company's
stockholders of up to 24,863,266 shares of the common stock of the
Company.
The Company's common stock is traded on the NASDAQ Global Select
Market under the symbol "BLDR." On Dec. 5, 2013, the last
reported sale price of the Company's common stock on NASDAQ was
$6.57.
The Company amended the registration statement to delay its
effective date until the Company will file a further amendment
which specifically states that this Registration Statement will
thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement will
become effective on as the Securities and Exchange Commission,
acting pursuant to said Section 8(a), may determine.
A copy of the Form S-3/A prospectus is available for free at:
http://is.gd/vQ8zNy
About Builders FirstSource
Headquartered in Dallas, Texas, Builders FirstSource Inc. --
http://www.bldr.com/-- supplies and manufactures building
products for residential new construction. The Company operates
in nine states, principally in the southern and eastern United
States, and has 55 distribution centers and 51 manufacturing
facilities, many of which are located on the same premises as its
distribution facilities.
Builders FirstSource reported a net loss of $56.85 million in
2012, a net loss of $64.99 million in 2011 and a $95.50 million in
2010. The Company's balance sheet at Sept. 30, 2013, showed
$533.87 million in total assets, $528.41 million in total
liabilities and $5.45 million in total stockholders' equity.
* * *
As reported by the TCR on May 15, 2013, Standard & Poor's Ratings
Services Inc. said it raised its corporate credit rating on
Dallas-based Builders FirstSource to 'B' from 'CCC'. "The upgrade
acknowledges U.S.-based building materials manufacturer and
distributor Builders FirstSource Inc.'s 'strong' liquidity based
on the company's proposed recapitalization," said Standard &
Poor's credit analyst James Fielding.
CAPITOL BANCORP: Multiple Parties Object to Plan Confirmation
-------------------------------------------------------------
BankruptcyData reported that multiple parties -- including Capitol
Bancorp's official committee of unsecured creditors, Manufacturers
and Traders Trust, Wilmington Trust and Bank of New York Mellon
Trust -- filed with the U.S. Bankruptcy Court separate objections
to confirmation of Capitol Bancorp's Amended Joint Liquidating
Plan.
The official committee states, "The Plan suffers from two major --
and fatal -- flaws. First, the Debtors have proposed that this
Court release the Debtors' insiders, including their officers and
directors, from any liability for any claims arising on or before
the Effective Date of the Plan. What is more, the Debtors have
proposed these non-consensual, third-party releases in the context
of a Chapter 11 plan of liquidation. Such releases are prohibited
in this (and other) circuits and their presence in the Plan
compels entry of an order denying confirmation of the Plan.
Second, the Debtors have turned the chapter 11 process on its
head. In a normal case, a chapter 11 debtor would decide whether
it intends to liquidate or reorganize and then file a plan that
accomplished either a liquidation or reorganization. Not these
Debtors. Eager to secure the third party releases discussed
above, and for current management to maintain control of the
Debtors with little creditor oversight, the Debtors have filed a
chapter 11 plan that punts the decision to liquidate or
reorganize."
About Capitol Bancorp
Capitol Bancorp Ltd. and Financial Commerce Corporation filed
voluntary Chapter 11 bankruptcy petitions (Bankr. E.D. Mich. Case
Nos. 12-58409 and 12-58406) on Aug. 9, 2012.
Capitol Bancorp -- http://www.capitolbancorp.com/-- is a
community banking company with a network of individual banks and
bank operations in 10 states and total consolidated assets of
roughly $2.0 billion as of June 30, 2012. CBC owns roughly 97% of
FCC, with a number of CBC affiliates owning the remainder. FCC,
in turn, is the holding company for five of the banks in CBC's
network. CBC is registered as a bank holding company under the
Bank Holding Company Act of 1956, as amended, 12 U.S.C. Sec. 1841,
et seq., and trades on the OTCQB under the symbol "CBCR."
Lawyers at Honigman Miller Schwartz and Cohn LLP represent the
Debtors as counsel. John A. Simon, Esq., at Foley & Lardner LLP,
represents the Official Committee of Unsecured Creditors as
counsel.
In its petition, Capitol Bancorp scheduled $112,634,112 in total
assets and $195,644,527 in total liabilities. The petitions were
signed by Cristin K. Reid, corporate president.
The Company's balance sheet at Sept. 30, 2012, showed
$1.749 billion in total assets, $1.891 billion in total
liabilities, and a stockholders' deficit of $141.8 million.
Prepetition, the Debtor arranged a reorganization plan that was
accepted by the requisite majorities of creditors and equity
holders in all classes. Problems arose when affiliates of
Valstone Partners LLC declined to proceed with a tentative
agreement to fund the reorganization by paying $50 million for
common and preferred stock while buying $207 million in face
amount of defaulted commercial and residential mortgages.
CENTRAL ENERGY: CEGP Acquisition Holds 15.7% of Common Units
------------------------------------------------------------
In a Schedule 13D filed with the U.S. Securities and Exchange
Commission, CEGP Acquisition, LLC, and John L. Denman, Jr.,
disclosed that as of Nov. 26, 2013, they beneficially owned
3,000,000 common units of Central Energy Partners LP representing
15.7 percent of the Units outstanding. A copy of the regulatory
filing is available at http://is.gd/AIMB6E
About Central Energy Partners
Dallas, Tex.-based Central Energy Partners LP is a publicly-traded
Delaware limited partnership. It currently provides liquid bulk
storage, trans-loading and transportation services for hazardous
chemicals and petroleum products through its wholly-owned
subsidiary, Regional Enterprises, Inc. ("Regional").
Central Energy Partners LP filed with the U.S. Securities and
Exchange Commission its annual report on Form 10-K disclosing a
net loss of $1.03 million on $5.47 million of revenue for the year
ended Dec. 31, 2012, as compared with a net loss of $1.36 million
on $6.84 million of revenue during the prior year.
Montgomery Coscia, LLP, in Plano, Texas, issued a "going concern"
qualification on the consolidated financial statements for the
year ended Dec. 31, 2012, citing insufficient cash flow to pay its
current obligations and contingencies as they become due.
The Company's balance sheet at Sept. 30, 2013, showed $7.94
million in total assets, $8.23 million in total liabilities and a
$290,000 total partners' deficit.
Bankruptcy Warning
"Central's ability to raise capital is hindered by the existing
pledge and therefore the ability to obtain additional capital over
the cash generated from operations to make the Hopewell Note
payments, for payment of income taxes, for expansion, capital
improvements to existing assets, for working capital or otherwise
is limited. In addition, the Partnership has obligations under
existing registrations rights agreements. These rights may be a
deterrent to any future equity financings. Management continues
to seek acquisition opportunities for the Partnership to expand
its assets and generate additional cash from operations. As
described above, there is no assurance that Regional will have
sufficient working capital to cover its ongoing cash requirements
or any of the ongoing overhead expenses of the Partnership for the
period of time that management believes is necessary to complete
an acquisition that will provide additional working capital for
the Partnership. If the Partnership does not have sufficient cash
reserves, its ability to pursue additional acquisition
transactions will be adversely impacted. Furthermore, despite
significant effort, the Partnership has thus far been unsuccessful
in completing an acquisition transaction. There can be no
assurance that the Partnership will be able to complete an
accretive acquisition or otherwise find additional sources of
working capital. If an acquisition transaction cannot be
completed or if additional funds cannot be raised and cash flow is
inadequate, the Partnership and/or Regional would be required to
seek other alternatives which could include the sale of assets,
closure of operations and/or protection under the U.S. bankruptcy
laws," the Company said in the quarterly report for the period
ended Sept. 30, 2013.
CASH STORE: To Hold Q4 Results Conference Call on Dec. 12
---------------------------------------------------------
The Cash Store Financial Services Inc. released the details for
the management conference call and webcast with shareholders,
analysts and institutional investors to discuss its fourth quarter
results for the three and 12 months ended Sept. 30, 2013. The
call will be held on Thursday, Dec. 12, 2013, at 11:00 a.m. EST
(9:00 a.m. MST). The results will be released after market closes
on Wednesday, Dec. 11, 2013.
The conference call may be accessed by dialing toll-free 1-888-
231-8191 and providing the conference ID #16023132. It will also
be broadcast live via the Internet at http://cnw.ca/Yxz5e.
A replay of the conference call will be available until Dec. 19,
2013, by dialing toll-free 1-855-859-2056 and providing the
conference ID #16023132.
About Cash Store Financial
Headquartered in Edmonton, Alberta, The Cash Store Financial is
the only lender and broker of short-term advances and provider of
other financial services in Canada that is listed on the Toronto
Stock Exchange (TSX: CSF). Cash Store Financial also trades on
the New York Stock Exchange (NYSE: CSFS). Cash Store Financial
operates 512 branches across Canada under the banners "Cash Store
Financial" and "Instaloans". Cash Store Financial also operates
25 branches in the United Kingdom.
Cash Store Financial is a Canadian corporation that is not
affiliated with Cottonwood Financial Ltd. or the outlets
Cottonwood Financial Ltd. operates in the United States under the
name "Cash Store". Cash Store Financial does not do business
under the name "Cash Store" in the United States and does not own
or provide any consumer lending services in the United States.
Cash Store Financial employs approximately 1,900 associates.
As restated, the Company reported a net loss and comprehensive
loss of $43.52 million on $187.41 million of revenue for the year
ended Sept. 30, 2012, as compared with a net loss of $43.08
million as originally reported.
The Company's restated balance sheet at Sept. 30, 2012, showed
$202.44 million in total assets, $168.92 million in total
liabilities and $33.51 million shareholders' equity.
* * *
As reported in the Feb. 8, 2013 edition of the TCR, Standard &
Poor's Ratings Services lowered its issuer credit rating on Cash
Store Financial (CSF) to 'CCC+' from 'B-'. The outlook is
negative.
"The downgrades follow a proposal by the payday loan registrar in
Ontario to revoke CSF's payday lending licenses and CSF's
announcement that it has discontinued its payday loan product in
the region," said Standard & Poor's credit analyst Igor Koyfman.
The company's businesses in Ontario, which account for
approximately one-third of its store count, will begin offering a
new line of credit product to its customers. S&P believes this is
to offset the loss of its payday lending product; however, this is
a relatively new product, and S&P believes that it will be
challenging for the company to replace its lost earnings from the
payday loan product. S&P also believes that the registrar's
proposal could lead to similar actions in other territories.
As reported by the TCR on May 22, 2013, Moody's Investors Service
downgraded the Corporate Family Rating and senior unsecured debt
rating of Cash Store Financial Services to Caa1 from B3 and
assigned a negative outlook. According to Moody's, CSFS remains
unprofitable on both the pretax and net income lines and prospects
for return to profitability are unclear.
CEETOP INC: Unit Inks Employment Agreements with CEO and CFO
------------------------------------------------------------
Hangzhou Ceetop Network Technology Co. Ltd., subsidiary of China
Ceetop.com, Inc., entered into an agreement with Liu Weiliang, CEO
of the Company. This agreement provides that Mr. Liu will serve
as CEO for a period of three years commencing Dec. 1, 2013. He
will receive a monthly salary of RMB 10,000 yuan and 400,000
shares of common stock of the Company.
On Dec. 4, 2013, Hangzhou entered into an agreement with Jia
Shengming, CFO of the Company. This agreement provides that Mr.
Jia will serve as CFO for a period of three years commencing
Dec. 1, 2013. He will receive a monthly salary of RMB 10,000 yuan
and 250,000 shares of common stock of the Company.
The issuance of the securities were not registered under the
Securities Act of 1933, and was made in reliance upon the
exemptions from the registration requirements of the Securities
Act set forth in Regulation S thereof.
About Ceetop Inc.
Oregon-based Ceetop Inc., formerly known as China Ceetop.com,
Inc., owned and operated the online retail platform before 2013.
Due to excessive competition in online retail, the Company has
transformed itself into an integrated supply chain services
provider, and focuses on B to B supply chain management and
related value-added services among enterprises.
China Ceetop's balance sheet at June 30, 2013, showed $3.5 million
in total assets, $4.0 million in total liabilities, and a
stockholders' deficit of $463,482.
Going Concern Uncertainty
"For the year ended Dec. 31, 2012, our independent auditors, in
their report on the financial statements, have indicated that the
Company has experienced recurring losses from operations and may
not have enough cash and working capital to fund its operations
beyond the very near term, which raises substantial doubt about
our ability to continue as a going concern. Management has made a
similar note in the financial statements. As indicated herein, we
must raise capital for the implementation of our business plan,
and we will need additional capital for continuing our operations.
We do not have sufficient revenues to pay our expenses of
operations. Unless the Company is able to raise working capital,
it is likely that the Company either will have to cease operations
or substantially change its methods of operations or change its
business plan," the Company said in its quarterly report for the
period ended June 30, 2013.
CHARMING CHARLIE: S&P Assigns 'B-' CCR & Rates $150MM Loan 'B-'
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned a 'B-' corporate
credit rating to Houston-based Charming Charlie Inc. The outlook
is stable. At the same time, S&P assigned a 'B-' issue-level
rating to the company's $150 million term loan B due 2019 with a
'3' recovery rating. The '3' recovery rating indicates S&P's
expectation for meaningful (50%-70%) recovery of principal in the
event of a payment default.
"The rating on Charming Charlie Inc. reflects our assessment of
its 'vulnerable' business risk profile and 'highly leveraged'
financial risk profile. The vulnerable business risk profile
incorporates our view of the company's participation in the highly
competitive and widely fragmented fashion jewelry and accessory
segment," said credit analyst David Kuntz. "In our view, this
segment continues to perform well with industry growth rates in
the low- to mid-single digits per year. Although the company is
well diversified across the U.S., in our opinion, it is much
smaller in terms of size and scope of operations compared with
other competitors."
The stable outlook reflects S&P's view that the company will
demonstrate meaningful performance gains over the next year from
store base expansion, some improvement in same-store sales,
merchandise enhancements, and good cost controls. As a result,
S&P believes the company will strengthen its credit protection
profile through EBITDA growth. S&P forecasts leverage will
decline to about 5.0x, FFO to total debt to remain in the low-
double digits, and interest coverage to be around 3.0x. However,
in S&P's view, it still expects same-store sales to remain
modestly negative over the next 12 months.
Downside Scenario
S&P could lower the rating if performance weakens materially from
current levels. Under this scenario, a significant reduction of
consumer spending coupled with meaningful operational issues
results in a substantial decline in both revenues and margins. At
that time, S&P's view of liquidity sources divided by liquidity
uses would be less than 1.2x. S&P could also lower the rating if
cushion under financial performance covenants declines to less
than 10%. Under either of these scenarios, S&P would reassess the
company's liquidity as "less than adequate".
Upside Scenario
S&P could raise the rating if the company is able to successfully
manage its store growth, maintain sustained revenue improvement
(including demonstrating positive same-store sales), and maintain
EBITDA margins. Under this scenario, the company would
meaningfully reduce its leverage ahead of our forecast through
EBITDA growth. At that time, total debt to EBITDA (including S&P's
preferred equity adjustment) would be below 4.0x and interest
coverage would be in the mid-3.0x area. Additionally, an upgrade
would also be predicated on S&P's belief that the company would
not undertake any debt-financed dividends that would impair its
credit protection measures.
CHESAPEAKE/MPS MERGER: Moody's Assigns 'B2' CFR on Merger Deal
--------------------------------------------------------------
Moody's Investors Service has assigned a B2 Corporate Family
Rating to packaging company Chesapeake/MPS Merger Limited on the
proposed merger of UK-based Chesapeake/MPS Merger Limited with US-
based print and packaging company Multi Packaging Solutions, Inc.
(New) ("MPS"). On close of the proposed merger, Chesapeake/MPS (a
holding company, subject to re-naming), will have 100% ownership
of all subsidiaries of the merged companies. Moody's has also
assigned a B1 rating to Chesapeake/MPS' proposed senior secured
credit facilities , which comprise a $50 million revolving credit
facility and a $280 million term loan currently issued by MPS (to
be amended for this merger), a new $122 million term loan, as well
as a GBP145 million term loan, a GBP50 million multi-currency
revolver and a EUR173 million term loan currently issued by
Chesapeake/MPS Merger Limited (to be amended for this merger).
Moody's has affirmed the Caa1 rating on MPS' senior unsecured
notes due 2021. The ratings outlook is stable. MPS' B2 CFR and the
Ba3 ratings on its current senior secured credit facilities will
be withdrawn on close of the proposed merger and refinancing.
Assignments:
Issuer: Chesapeake/MPS Merger Limited
Probability of Default Rating, Assigned B2-PD
Corporate Family Rating, Assigned B2
$50 Million Senior Secured Revolving Credit Facility, Assigned B1
(LGD3, 39%)
$280 Million Senior Secured Term Loan Facility, Assigned B1
(LGD3, 39%)
$122 Million Senior Secured Term Loan Facility, Assigned B1
(LGD3, 39%)
GBP50 Million Senior Secured Revolving Credit Facility, Assigned
B1 (LGD3, 39%)
GBP145 Million Senior Secured Term Loan Facility, Assigned B1
(LGD3, 39%)
EUR173 Million Senior Secured Term Loan Facility, Assigned B1
(LGD3, 39%)
Affirmations:
Issuer: Multi Packaging Solutions, Inc. (New)
Senior Unsecured Regular Bond/Debenture, Affirmed Caa1 (LGD6, 90%)
The senior secured credit facilities of both MPS and
Chesapeake/MPS Merger Limited will be amended to include
Chesapeake/MPS (pre-merger), MPS, and other holding companies in
the post-merger corporate structure as co-borrowers of these
credit facilities. All of the US, and certain foreign, operating
subsidiaries of the newly-merged Chesapeake/MPS corporate entity
will be guarantors of the amended credit facilities. The proposed
$122 million new term loan facility will have the same co-
borrowers and guarantors as the amended credit facilities. As
such, Moody's views these debt instruments to be pari-passu, which
is reflected in their common B1 rating. The proposed refinancing
transactions also call for MPS' senior unsecured notes to be
amended (via consent by note holders), to include as guarantors
the same entities guaranteeing the senior secured credit
facilities. The subordination of these notes to a substantial
amount of secured credit facilities results in a Caa1 rating,
which is two notches below the CFR.
Ratings Rationale:
Chesapeake/MPS' B2 CFR is the same as MPS' current (pre-merger)
Corporate Family Rating, largely reflecting a post-merger capital
structure whose leverage is similar to that of MPS prior to the
merger. The combination of the two companies' debt obligations,
along with the additional $122 million term loan to be used to
fund a payment to Chesapeake/MPS' existing shareholders (The
Carlyle Group) to achieve a pro forma ownership share equal to
that of MPS' shareholders (Madison Dearborn Partners), will result
in total pro forma debt of approximately $1.2 billion on close
(including Moody's standard adjustments). This represents
approximately 85% of the estimated $1.4 million of pro forma
revenue. With roughly similar operating margins contributed by
both businesses, Moody's estimates pro forma leverage (Debt to
EBITDA) of almost 6 times. This is close to MPS' current leverage,
and somewhat higher than typical for B2-rated entities. Other pro
forma credit metrics map closer to the B2 rating, such as interest
coverage (EBITDA less CAPEX to Interest) of 1.8 times, and Funds
from Operations to Debt of approximately 11%.
Offsetting high leverage, Moody's notes that the merger will
create a print and packaging company of formidable scale, with a
broad international operating footprint. This will result in
increased geographic and customer diversification, and an improved
competitive position against smaller operators in this highly
competitive business segment. Moreover, with free cash flow
estimated in excess of $50 million annually from the operations of
Chesapeake/MPS at stable operating margins, Moody's expects that
the new company will be able to de-lever, through improving
earnings as well as a modest degree of debt reduction, to levels
that are more in-line with the B2 CFR. Nonetheless,
Chesapeake/MPS' ratings take into account integration risks
inherent in a merger of this size and scope, particularly if
subsequent restructuring of operations results in pressure on
margins over the near term. Ratings are also negatively influenced
by the limited track record of the UK-based businesses as a stand-
alone entity in its current operating profile. Also, although the
currencies of pro forma debt structure is well-aligned with the
company's geographic operations, Moody's notes that
Chesapeake/MPS' consolidated financial results, in US dollars,
will be subject to a higher degree of foreign currency exposure,
Sterling and Euro in particular.
The stable ratings outlook reflects Moody's expectations that the
integration of the merged entities will proceed smoothly, allowing
the company to maintain margins with little interruption in
business activity, while maintaining its customer base. This
should allow leverage to fall to approximately 5 times by the end
of 2014, as the company uses free cash flow to make modest debt
repayments.
Ratings could be lowered if Chesapeake/MPS encounters unexpected
difficulty in implementing its integration plans, diminishing
revenue growth and lowering margins over the near term. The
negative effects of such an event would be exacerbated if it were
to coincide with a drop in demand due to weakness in economic
drivers, such as during a recession. Lower ratings could be
prompted if Debt to EBITDA remains above 5.5 times, EBITDA less
CAPEX to Interest were to fall below 1.5 times, or if Funds from
Operations were to fall below 8% of debt. A material weakening in
liquidity, evidenced by a pattern of negative free cash flow or
substantial drawings on revolving credit facilities, could also
pressure ratings.
Higher rating considerations would require that the company
demonstrates steady revenue growth and margin improvement,
resulting in free cash flow generation and substantial debt
reduction. Debt to EBITDA sustained below 4 times and EBITDA less
CAPEX to Interest of above 2 times would be indicative of upward
rating factors.
Chesapeake/MPS Merger Limited, through its main operating
subsidiaries in the US and Europe, is a global provider of
consumer packaging products and solutions to the consumer, health
care, and multi-media markets.
CITGO PETROLEUM: S&P Lowers Corp. Credit Rating to B+; Outlook Neg
------------------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its corporate
credit rating on Houston-based CITGO Petroleum Corp. to 'B+' from
'BB-'. All related issue-level ratings on the company's debt were
also lowered by one notch in conjunction with the downgrade. The
ratings were removed from CreditWatch, where S&P placed them with
negative implications on Nov. 27, 2013. The rating outlook is
negative. Recovery ratings on the company's debt issues remain
unchanged.
"We base our downgrade on the application of the group ratings
methodology and our assessment of CITGO as an insulated subsidiary
to its Venezuelan parent, PdVSA. We assess the group credit
profile of PdVSA at 'b', in line with our corporate credit rating
on PdVSA. We believe the facts and circumstances warrant CITGO
being rated one notch above PdVSA. In our view, there could be
scenarios in which PdVSA could incur financial distress but the
creditworthiness of CITGO remain relatively unscathed. CITGO is
severable from PdVSA, has independent financial prospects, and
holds itself out as a separate entity. The cross-border ownership
and the highly restrictive debt covenants at CITGO lower the
probability of it being drawn into a potential PdVSA bankruptcy.
At the same time, we believe no more than one notch of separation
is warranted given PdVSA's full control over CITGO. There is no
presence of independent directors or other structural ring-fencing
features," S&P said.
At the current rating level, the negative outlook on CITGO mirrors
that on PdVSA. The outlook on PdVSA reflects that on Venezuela.
"We do not expect PDVSA's relationship with the government to
change significantly in the next two to three years," said
Standard & Poor's credit analyst Nora Pickens. "We also believe
that the government will not significantly reduce its heavy
involvement in the sector or in the company. Therefore, the
rating on PdVSA will likely follow the rating trajectory on the
sovereign."
S&P would revise the outlook on CITGO to stable in the event that
it would do the same to the outlook on PDVSA. Similarly, S&P
would likely downgrade CITGO if PdVSA were downgraded. Since
CITGO's SACP is 'bb', it is unlikely that S&P would lower CITGO's
rating due to company-specific factors.
CLAIRE'S STORES: Files Form 10-Q; Incurs $25.5MM Net Loss in Q3
---------------------------------------------------------------
Claire's Stores, Inc., filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $25.46 million on $356.93 million of net sales for the three
months ended Nov. 2, 2013, as compared with a net loss of $13.73
million on $363.38 million of net sales for the three months ended
Oct. 27, 2012.
For the nine months ended Nov. 2, 2013, the Company reported a net
loss of $72.72 million on $1.07 billion of net sales as compared
with a net loss of $40.92 million on $1.06 billion of net sales
for the same period a year ago.
The Company's balance sheet at Nov. 2, 2013, showed $2.73 billion
in total assets, $2.81 billion in total liabilities and a $89.32
million stockholders' deficit.
A copy of the Form 10-Q is available for free at:
http://is.gd/6ozN3H
About Claire's Stores
Claire's Stores, Inc. -- http://www.clairestores.com/-- operates
as a specialty retailer of fashion accessories and jewelry for
preteens and teenagers, as well as for young adults in North
America and internationally. It offers jewelry products that
comprise costume jewelry, earrings, and ear piercing services; and
accessories, including fashion accessories, hair ornaments,
handbags, and novelty items.
Based in Pembroke Pines, Florida, Claire's Stores operates under
two brands: Claire's(R), which operates worldwide and Icing(R),
which operates only in North America. As of Jan. 31, 2009,
Claire's Stores, Inc., operated 2,969 stores in North America and
Europe. Claire's Stores also operates through its subsidiary,
Claire's Nippon, Co., Ltd., 213 stores in Japan as a 50:50 joint
venture with AEON, Co., Ltd. The Company also franchises 198
stores in the Middle East, Turkey, Russia, South Africa, Poland
and Guatemala.
Claire's Stores disclosed net income of $1.28 million on $1.55
billion of net sales for the fiscal year ended Feb. 2, 2013, as
compared with net income of $11.63 million on $1.49 billion of net
sales for the fiscal year ended Jan. 28, 2012.
Bankruptcy Warning
The Company said the following statement in its annual report for
the fiscal year ended Feb. 2, 2013.
"If we are unable to generate sufficient cash flow and are
otherwise unable to obtain funds necessary to meet required
payments of principal, premium, if any, and interest on our
indebtedness, or if we otherwise fail to comply with the various
covenants, including financial and operating covenants in the
instruments governing our indebtedness, we could be in default
under the terms of the agreements governing such indebtedness. In
the event of such default:
* the holders of such indebtedness may be able to cause all of
our available cash flow to be used to pay such indebtedness
and, in any event, could elect to declare all the funds
borrowed thereunder to be due and payable, together with
accrued and unpaid interest;
* the lenders under our Credit Facility could elect to
terminate their commitments thereunder, cease making further
loans and institute foreclosure proceedings against our
assets; and
* we could be forced into bankruptcy or liquidation," according
to the Company's annual report for the fiscal year ended
Feb. 2, 2013.
* * *
As reported by the TCR on Oct. 1, 2012, Moody's Investors Service
upgraded Claire's Stores, Inc.'s Corporate Family and Probability
of Default ratings to Caa1 from Caa2. The upgrade of Claire's
Corporate Family Rating to Caa1 reflects its ability to address
its substantial term loan maturity in 2014 by refinancing it with
a $625 million add-on to its existing senior secured first lien
notes due 2019.
Claire's Stores, Inc., carries a 'B-' corporate credit rating from
Standard & Poor's Ratings Services.
CLOUD MEDICAL: GBH CPAs Replaces S.E. Clark as Auditors
-------------------------------------------------------
National Scientific Corporation's independent auditors, S.E. Clark
& Company, P.C., were dismissed and concurrently the Company has
engaged GBH CPAs, PC, as the Company's independent auditors for
the fiscal year ending Sept. 30, 2012. This decision was approved
by the Company's Board of Directors.
During the fiscal years ended Sept. 30, 2008, 2009, 2010 and 2011
and the subsequent interim periods preceding the cessation of the
relationship with Clark, there were no disagreements with Clark on
matters of accounting principles or practices, financial statement
disclosure or auditing scope or procedures or any reportable
events, which disagreement, if not resolved to the satisfaction of
the former accountants, would have caused it to make reference to
the subject matter of the disagreement in connection with its
report. National Scientific Corporation is currently a Medical
Software and Technology company, and reports by Clark on the
balance sheets for each of the last four fiscal years, and the
related statements of operations, stockholders' equity, and cash
flows for each of the four years, do contain a going concern
notice, but do not otherwise contain a disclaimer of opinion and
were not qualified or modified as to uncertainty, audit scope or
accounting principles.
The Company has not, during its four most recent fiscal years and
any subsequent interim periods prior to engaging GBH, consulted
with GBH.
About Cloud Medical
Henderson, Nev.-based Cloud Medical Doctor Software Corporation
introduced in 2011 the Cloud-MD Office, a "Cloud Based", 5010 and
ICD-10 compliant, fully integrated and interoperable suite of
medical software and services, designed by experienced healthcare
analysts and programmers for healthcare providers, that produces
"Actionable Information" to help Independent Physician Practices,
New Care Delivery Models (ACO), Healthcare Systems and Billing
Services optimize a wide range of business processes resulting in
Increased Profits, Higher Quality, Greater Efficiency, Noticeable
Cost Reductions and Better Patient Care. Current software product
offerings include Practice Management, Electronic Medical Records,
Revenue Management, Patient Financial Solutions, Medical and
Pharmaceutical Supply Management, Claims Management and PHI
Exchange.
S.E.Clark & Company, P.C., in Tucson, Arizona, expressed
substantial doubt about Cloud Medical's ability to continue as a
going concern. The independent auditors noted that the Company
has a net loss for the year ended Sept. 30, 2011, of $356,629, an
accumulated deficit at Sept. 30, 2011, of $26,229,970, cash flows
used by operating activities of $220,628, and needs additional
cash flows to maintain its operations.
COOPER-BOOTH: Court Okays Deal Permitting Cash Use Thru Dec. 28
---------------------------------------------------------------
Judge Magdeline D. Coleman signed an amended and restated second
final stipulation and order authorizing Cooper-Booth Wholesale
Company, L.P., et al., to use cash collateral until Dec. 28, 2013.
PNC Bank, National Association, and Zurich American Insurance
Company consent to the Debtors' use of cash collateral until
Dec. 28 at 5:00 p.m. subject to the Debtors providing adequate
protection pursuant to the terms of the stipulation. A copy of
the stipulation is available for free at:
http://bankrupt.com/misc/Cooper_Booth_Cash_Order_112713.pdf
Signatories to the stipulation are:
Aris J. Karalis, Esq.
Robert W. Seitzer, Esq.
Dustin G. Kreider, Esq.
MASCHMEYER KARALIS
P.O. 1900 Spruce Street
Philadelphia, PA 19103
Attorneys for the Debtors
- and -
Claudia Z. Springer, Esq.
Derek J. Baker, Esq.
Brian M. Schenker, Esq.
REED SMITH LLP
2500 One Liberty Place
1650 Market Street
Philadelphia, PA 19103
Attorneys for PNC Bank
- and -
Mort Brahzburg, Esq.
Richard Beck, Esq.
KLEHR HARRISON HARVEY BRANZBURG LLP
1835 Market Street
Philadelphia, PA 19103
Attorney for the Creditors Committee
- and -
Karen Lee Turner, Esq.
ECKERT SEAMANS CHERIN & MELLOTT, LLC
Two Liberty Place
50 South 16th Street, 22nd Floor
Philadelphia, PA 19102
Attorney for Zurich
About Cooper-Booth Wholesale
Cooper-Booth Wholesale Company, L.P. and two affiliates sought
Chapter 11 protection (Bankr. E.D. Pa. Lead Case No. 13-14519) in
Philadelphia on May 21, 2013, after the U.S. government seized the
Company's bank accounts to recover payments made by a large
customer caught smuggling Virginia-stamped cigarettes into New
York.
Serving the mid-Atlantic region, Cooper is one of the top 20
convenience store wholesalers in the country. Cooper supplies
cigarettes, snacks, beverages and other food items from Hershey's,
Lellogg's, Bic, and Mars to convenience stores. Cooper has been
in the wholesale distribution business since 1865 when the Booth
Tobacco Company was incorporated in Lancaster, Pennsylvania. The
Company has been family owned and operated for three generations.
Aris J. Karalis, Esq., and Robert W. Seitzer, Esq., at Maschmeyer
Karalis, P.C., in Philadelphia, serve as the Debtors' bankruptcy
counsel. Executive Sounding Board Associates, Inc., is the
financial advisor. SSG Advisors, LLC, serves as investment
bankers. Blank Rome LLP represents the Debtor in negotiations
with federal agencies concerning the seizure warrant.
Roberta A. DeAngelis, the U.S. Trustee for Region 3, appointed
three members to the Official Unsecured Creditors' Committee in
the Chapter 11 case.
Cooper-Booth disclosed $58,216,784 in assets and $35,054,482 in
liabilities as of the Chapter 11 filing. As of the Petition Date,
the Debtors' total consolidated funded senior debt obligations
were approximately $10.7 million and consisted of, among other
things, $7.72 million owing on a revolving line of credit
facility, $2.83 million owing on a line of credit for the purchase
of equipment, and $166,000 due on a corporate VISA Card. PNC Bank
asserts that a letter of credit facility is secured by all
personal property owned by Wholesale. Unsecured trade payables
totaled $22.8 million as of May 21, 2013.
CTP TRANSPORTATION: Moody's Rates $250MM Sr. Secured Notes 'B2'
---------------------------------------------------------------
Moody's Investors Service assigned a B2 rating to CTP
Transportation Products, LLC's new $250 million Senior Secured
Notes offering, which along with borrowings under the company's
new $100 million asset backed revolver (unrated) and equity from
American Industrial Partners (AIP), is expected to fund the
acquisition of the transportation segment of Carlisle Companies.
CTP is a global manufacturer of specialty tires and wheels for
non-automotive application as well as power transmission belts for
industrial drive applications. Moody's also assigned a B1
Corporate Family Rating (CFR) and B1-PD Probability of Default
Rating (PDR) to CTP. The rating outlook is Stable.
Assignments:
Issuer: CTP Transportation Products, LLC
Probability of Default Rating, Assigned B1-PD
Corporate Family Rating, Assigned B1
Senior Secured $250 million notes, Assigned B2 LGD4-62%
The rating outlook is stable.
Ratings Rationale:
The B1 CFR reflects the company's limited business diversification
with over 80% of sales generated in one segment, deeply cyclical
end markets, regional concentration in North America, and
meaningful exposure to volatile raw material costs. These factors
are balanced by good leverage for the rating category, a strong
brand, end market diversification, its significant recurring
revenue base, and financial metrics that are anticipated to be
strong for the rating category with 2013 year-end expected Debt to
EBITDA of approximately 4.0x and EBITA to Interest of
approximately 2.0x. The Stable outlook reflects Moody's
expectation of steady performance over the next 12 -- 18 months
supported by the company's adequate liquidity, stable margins and
free cash flow generation.
Moody's assignment of a B2 to the company's $250 million Senior
Secured Notes offering reflects the Notes' second lien claim on
the ABL collateral and a first lien claim on the non-ABL
collateral. Conversely, the rating on the notes also reflects the
$100 million ABL facility's (not rated) first lien claim on the
ABL collateral and a second lien claim on all other assets. The
rating on the notes also reflects the lack of junior capital that
is in a first loss position in the event of default.
Moody's expects CTP to maintain an adequate liquidity profile over
the next 18 months supported by stable free cash flow generation
due in part to the company's low capital investment requirements.
Moody's expects that the company will rely on its new $100 million
ABL revolver for intra-quarter liquidity, which is expected to be
partially drawn pro forma for the transaction. The terms of the
ABL and Notes, respectively, are anticipated to be covenant lite
but incorporate a springing fixed charge coverage covenant of
1.0x, triggered when ABL borrowings equal or exceed 90% of the
facility's availability.
The ratings and/or outlook could be downgraded if EBITA to
interest decreased below 2.0x or Debt to EBITDA increased to over
5.0x and was anticipated to weaken. The ratings could also be
affected as a result of a unexpected softness in some of the
company's key end markets for its Tire and Wheel segment.
A ratings upgrade over the next year is not anticipated given the
cyclical nature of the company's products. The ratings could be
upgraded if EBITA to Interest was expected to exceed 3.5x on a
sustainable basis or if Debt to EBITDA was expected to improve to
under 3.5x, also on a sustainable basis. A meaningful improvement
in the company's working capital management such that liquidity
improved would also provide positive ratings traction.
The stable rating outlook reflects Moody's anticipation of stable
growth in demand in key end markets, which may lead to improved
profitability and cash flow yet expected to be sufficient over the
short term to warrant a higher rating. The outlook further
reflects Moody's anticipation of adequate liquidity supported by
sufficient ABL availability as well as modest capital expenditure
requirements.
CTP is a leading global supplier of specialty tires and wheels for
non-automotive applications and power transmission belts for
industrial drive applications across multiple end markets. The
company was founded in 1917 and has over 4,000 employees at around
20 facilities around the world. CTP is expected to generate sales
of over $750 million in 2013 and will be a portfolio company of
American Industrial Partners upon successful completion of the
acquisition.
CTP TRANSPORTATION: S&P Assigns 'B+' CCR & Rates $250MM Notes 'B+'
------------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its 'B+'
corporate credit rating to Tennessee-based nonautomotive specialty
tires, wheels, and belts manufacturer CTP Transportation Products
Holdings LLC (CTP Holdings). The outlook is stable. At the same
time, S&P assigned its 'B+' issue-level rating to the company's
proposed $250 million senior secured notes due 2019. The recovery
rating is '4', which indicates S&P's expectation for average
(30%-50%) recovery in the event of a payment default. CTP
Transportation Products LLC and CTP Finance Inc. are coborrowers
under the senior secured notes.
"The rating on CTP Holdings reflects our assessment of the
company's 'weak' business risk profile and 'aggressive' financial
risk profile," said Standard & Poor's credit analyst Carol Hom.
S&P's business risk profile assessment incorporates its view of
CTP Holdings' "weak" competitive position, which is characterized
by the company's narrow scope of operations (limited to off-road
wheels, tires, and belts); its exposure to raw materials price
volatility; its cyclical end markets, limited geographic
diversity, and significant customer concentration; and S&P's view
of its "weak" operating efficiency and "below average"
profitability (with EBITDA margins at about 10%), compared with
its industry peers'. These factors are somewhat offset by the
company's good market positions in most of its business segments,
and its sizable installed base, recognizable brand names, and
flexible, low-cost manufacturing footprint.
The outlook is stable. "We expect that CTP Holdings' credit
measures will remain steady with total debt to EBITDA in the 4x-5x
range and FFO to debt of about 15%," said Ms. Hom.
S&P could lower the rating if market demand for CTP Holdings'
products declines due to weak economic conditions and causes, for
example, leverage to deteriorate to more than 5x for an extended
period.
S&P could raise the rating if the company's free cash flow and
operating and financial performance improve and if its financial
policies are consistent with a higher rating. For example, if
debt to EBITDA and FFO to debt improved to about 3.5x and more
than 20%, respectively, for an extended period.
CUERVO RESOURCES: Strike Resources Demands Note Payment by Dec. 16
------------------------------------------------------------------
Cuervo Resources Inc. on Dec. 9 disclosed that it has received
notice from Strike Resources Limited demanding full repayment of a
$5.25 million promissory note by December 16, 2013, together with
accrued interest from date of default. The note held by Strike
has a maturity date of July 27, 2014, which is extendable, in
certain circumstances, at Cuervo's option, to January 23, 2015.
In its demand for early repayment of the note, Strike has asserted
that Cuervo is insolvent as it is unable to generally pay its
debts or meet its liabilities as they become due. These debts
include deferred salaries of Cuervo management and payables to
other creditors none of whom are currently demanding immediate
payment. Cuervo intends to contest Strike's demand for early
repayment of the promissory note.
In the circumstances, Cuervo's Board of Directors has decided to
send notice to Strike exercising Cuervo's right to extend the
maturity of the $5.25 million promissory note to January 23, 2015
under Section 2.7 of the Investment Agreement with Strike. It
should be noted by Cuervo shareholders that the extension of the
maturity does not negate Strike's demand for repayment; Strike
retains any rights it may have during the extension period. This
extension is being done by Cuervo to confirm that any and all
assets are for sale. Under the Investment Agreement the pledged
assets can only be sold by using the terms of Section 2.7.
Cuervo also noted that Strike has been in default of the
Investment Agreement, since February 2013. Specifically, upon
Cuervo filing a NI 43-101 compliant mineral resource estimate on
the pledged assets, showing an Inferred Mineral Resource of Iron
Ore of over 500 million tonnes, and having a grade of not less
than 40% Fe, Strike is required to accept a reduction of
collateral on Minera Cuervo common stock from 90% to 45%. Strike
has failed to meet that obligation and has unilaterally rejected
the NI 43-101 report.
Cuervo management and staff are deferring salaries, working to
sell assets, and remain committed to defend and advance the
interests of shareholders.
Headquartered in Toronto, Cuervo Resources Inc. --
http://www.cuervoresources.com-- is a Canada-based, exploration-
stage company. The Company is engaged in the acquisition,
exploration and development of mineral properties in Peru. The
Company mainly focuses on the exploration of its wholly owned
Cerro Ccopane iron ore property in southern Peru. The Company,
through its wholly owned Peruvian subsidiary, Minera Cuervo
S.A.C., has a 100% interest in approximately 52 mining concessions
covering over 25,840 hectares in Peru. Cuervo has 100% interest
in approximately 36 contiguous mining concessions south of Cusco
in southern Peru. The exploration targets on the Cerro Ccopane
Property are near-surface iron skarns containing massive magnetite
and some hematite.
D.C. DEVELOPMENT: To Seek Plan Confirmation on Dec. 23
------------------------------------------------------
D.C. Development, LLC, and its debtor-affiliates, are now slated
to seek confirmation of their Joint Plan of Liquidation on
Dec. 23, 2013, after they obtained approval of the explanatory
disclosure statement last week.
The Debtors, along with the Official Committee of Unsecured
Creditors, filed a Chapter 11 plan that contemplates the
liquidation of the remaining non-cash assets of the Debtors to pay
off creditors. As part of an agreement for Branch Banking and
Trust Co. (a holder of a general unsecured claim of $23.4 million)
to support confirmation of the Plan, the plan proponents have
agreed to make an interim distribution in the amount of $500,000
on the earlier of two business days after the Effective Date or
Dec. 27, 2013.
Judge Thomas J. Catliota's Dec. 3 order approving the Disclosure
Statement provides that:
-- Dec. 17, 2013, is fixed as the last day for filing
written acceptances or rejections of the Plan.
-- Dec. 23, 2013, at 11:00 a.m., is fixed for the hearing
on confirmation of the Plan to take place in Courtroom
3-C, U.S. Courthouse, 6500 Cherrywood Lane, Greenbelt,
Maryland 20770.
-- Dec. 18, 2013, is fixed as the last day for filing and
serving written objections to confirmation of the Plan
Representatives of the plan proponents can be reached at:
James A. Vidmar, Esq.
Lisa Yonka Stevens, Esq.
YUMKAS, VIDMAR & SWEENEY, LLC
2530 Riva Road, Suite 400
Annapolis, MD 21401
Counsel for the Debtors
- and -
Gary H. Leibowitz, Esq.
G. David Dean, II, Esq.
COLE SCHOTZ MEISEL FORMAN & LEONARD
300 East Lombard Street, Suite 2000
Baltimore, MD 21202
Counsel for the Creditors Committee
Disclosure Statement Objection Withdrawn
Clear Mountain Bank filed an objection to the disclosure statement
but the objection was later withdrawn without stating a reason.
In the objection, Clear Mountain said the Disclosure Statement
does not inform creditors why BB&T is being treated so much more
favorably than similarly situated general unsecured creditors who
are not otherwise entitled to such early estimated interim
payments under the Plan.
Clear Mountain is represented by:
MEYERS EISLER, LLC
Alan D. Eisler, Esq.
11140 Rockville Pike, Suite 570
Rockville, MD 20852
Tel: (240) 283-1164
Fax: (240) 283-1179
E-mail: aeisler@meyerseisler.com
The Plan
According to the Disclosure Statement, following the sales of
substantially all of the Debtors' business assets, the Debtors'
remaining assets include: (i) cash; (ii) avoidance actions; (iii)
the Roads and Open Space real property; (iv) a time share at the
Ritz Carlton in Aspen, Colorado; and (v) the real properties
subject to the secured claims of United Bank and Clear Mountain
Bank.
Only the holders of general unsecured claims (Classes 3A, 3B, 3C
and 3D) are entitled to vote on the Plan. Holders of secured
claims (Classes 1A-D) and priority non-tax claims (Classes 2A-D)
are not entitled to vote because they are considered "unimpaired"
and deemed to have accepted the Plan. Holders of equity interests
are deemed to reject the Plan as they won't receive anything.
A copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/dcdevelopment.doc847.pdf
About D.C. Development et al.
D.C. Development, LLC, Recreational Industries, Inc., Wisp Resort
Development, Inc., and The Clubs at Wisp, LLC (together, the
"Debtors") operated a ski resort and real estate development
companies generally known as "Wisp Resort," comprising of
approximately 2,200 acres of master planned and fully entitled
land, 32 ski trails covering 132 acres of skiable terrain with
12 lifts and two highly-rated golf courses.
Best known for its ski area and winter-related activities, the
resort transcends seasonal limits and provides year round
attractions with its location by Deep Creek Lake. The ski resort
was the centerpiece of the Wisp Resort and the Debtors' various
businesses.
DCD is a limited liability company formed under Maryland law for
the purpose of purchasing land surrounding Deep Creek Lake and
Wisp Resort. RI is a corporation formed under Maryland law for
the purpose of operating the Wisp Resort's activities, including
the management of the Wisp Resort Hotel and retail venues,
downhill skiing, cross country skiing, snowmobile tours, chairlift
rides, Wisp Resort Golf Course, Mountain Coaster, Outdoor
Adventures, snowtubing park, Haunted House, Flying Squirrel canopy
tour, Chipmunk Challenge course, Segway tours, and Mountain Buggy
tours.
WRD is a corporation formed under Maryland law for the purpose of
serving as the developing entity for the Lodestone subdivisions
and future subdivisions. TCW is a limited liability company
formed under Maryland law for the purpose of developing certain
real estate and owning and operating the club facilities of the
Wisp Resort including; Lodestone Golf Course and Club
("Loadstone"), Lakeside Club, and future Alpine Club.
The Debtors' most critical problem began in connection with the
Lodestone project. Following a highly successful 2006, WRD
entered into the BB&T Loan with BB&T. Because of an alleged
default under the BB&T loan modification, on July 19, 2011, BB&T
obtained a confessed judgment in the Circuit Court for Garrett
County, Maryland, Case No. 11-C-11-12151 against the Debtors in an
amount exceeding $34,444,645 (the "Confessed Judgment"). As a
result of the Confessed Judgment, the Debtors filed for protection
under Chapter 11 of the Bankruptcy Code in the Bankruptcy Court.
D.C. Development, LLC, Recreational Industries, Inc., Wisp Resort
Development, Inc., and The Clubs at Wisp, LLC, filed for Chapter
11 bankruptcy (Bankr. D. Md. Lead Case No. 11-30548) on Oct. 15,
2011, after defaulting on nearly $30 million in loans from BB&T
Corp. to build the golf course community. D.C. Development
disclosed $91,155,814 in assets and $46,141,245 in liabilities as
of the Chapter 11 filing.
The Debtors engaged James A. Vidmar, Esq. at Logan, Yumkas, Vidmar
& Sweeney LLC as counsel and tapped Invotex Group as financial
restructuring consultant. SSG Capital Advisors, LLC, serves as
exclusive investment banker to the Debtors. The Official
Committee of Unsecured Creditors has tapped Cole, Schotz, Meisel,
Forman & Leonard, P.A. as counsel.
On Dec. 4, 2012, the Bankruptcy Court approved the sale of the
Wisp resort to EPT Ski Properties, a unit of EPR Properties, for
$23.5 million. The judge also approved the sale of a golf course
and other land to National Land Partners for $6.1 million.
In February 2013, the Bankruptcy Court authorized the Debtors to
(i) sell substantially all of their assets on which Branch Banking
and Trust Company holds a first priority lien outside ordinary
course of business, to National Land Partners, LLC, a Delaware
limited liability company or its designee pursuant to the
Agreement for Sale and Purchase, dated Nov. 30, 2012; (ii) assume
and assign certain executory contracts and unexpired leases.
These assets were excluded in the successful bid at the resort
auction in December 2012.
DELPHI AUTOMOTIVE: S&P Raises CCR From 'BB+', Off CreditWatch
-------------------------------------------------------------
Standard & Poor's Ratings Services said that it has raised its
corporate credit rating on auto supplier Delphi Automotive PLC
(Delphi; parent of Delphi Corp.) to 'BBB-' from 'BB+'. At the
same time, S&P removed the rating from CreditWatch, where it
placed it with positive implications on Nov. 20, 2013. The
outlook is stable. S&P also lowered the issue-level rating on the
company's senior secured debt to 'BBB-' from 'BBB' because the
company may release collateral for this debt at its discretion
after it is assigned an investment-grade corporate credit rating
('BBB-' and higher), and S&P raised the rating on Delphi Corp.'s
senior unsecured debt to 'BBB-' from 'BB+'. S&P also withdrew the
'1' recovery rating on the senior secured debt and the '3'
recovery rating on the senior unsecured debt because the corporate
credit rating was raised to investment grade ('BBB-' and higher).
"The rating on Delphi reflects our assessment of the company's
financial risk profile as 'intermediate' and the business risk
profile as 'satisfactory,'" said Standard & Poor's credit analyst
Nancy Messer. "The rating also incorporates our view of Delphi's
liquidity as 'strong,' based on our criteria, and the company's
lack of large near-term debt maturities."
The outlook is stable. "We expect Delphi to continue generating
solid earnings and cash flow, with stable credit measures, despite
the weak European automotive market and the company's investments
for growth," said Ms. Messer. The credit measures for the rating
include debt leverage of 2x or less and FOCF to total debt of 15%
or higher through 2015. S&P believes that Delphi can maintain
these metrics because of its neutral financial policy, substantial
scope and scale, competitive market position, and operating
efficiency.
Although unlikely, S&P could raise the rating during the next two
years if Delphi maintains its credit measures at the current
levels or better, which would support a revision of the financial
profile to "modest" from "intermediate." This could occur if
Delphi is able to expand revenues, with EBITDA margins in the low
double digits, especially if its technically sophisticated
electronic and powertrain products outgrow its lower margin
products.
However, the company faces exposure to cyclical and highly
competitive end-markets, with potential swings in profitability,
and S&P believes that capital allocation will include further
return of funds to shareholders through share repurchases and
possible debt-funded acquisitions on an opportunistic basis. Over
the long term, Delphi's business profile assessment is less likely
to improve, given that the auto industry is evolving into a global
market and, as a result, competition and cyclicality will continue
to be major considerations.
Although also unlikely, S&P could lower the rating if it believes
that global auto markets, in aggregate, will not expand during the
next two years, preventing Delphi's profitability from meeting
S&P's expectations for the rating. S&P could also lower the
rating if it believes that Delphi's cash generation would suffer
significantly from lower-than-expected vehicle production levels
or a spike in unrecovered commodity costs, or if the company makes
a transforming acquisition or uses a material amount of cash to
fund shareholder-friendly actions.
S&P's rating incorporates the assumption that industry regulations
will push higher content for auto emissions, fuel efficiency, and
safety-related products, which Delphi provides, during the next
two years. If this global trend falters, S&P could lower the
rating. For example, S&P would reassess Delphi's financial risk
profile and its corporate credit rating if the company's pension-
and lease-adjusted FOCF to total debt drops to less than 15%, if
its pension- and lease-adjusted debt leverage increased to more
than 2x, or if its free cash flow were limited.
DEMCO INC: Dec. 11 Hearing on Additional DIP Loans From NESC
------------------------------------------------------------
The Bankruptcy Court will convene a hearing Dec. 11, 2013, at
10:00 a.m., to consider DEMCO Inc.'s motion to enter into a
further debtor-in-possession financing agreement with National
Environmental Safety Company, Inc.
Daniel F. Brown, Esq., at Andreozzi, Bluestein, Weber, Brown, LLP,
on behalf of the Debtor, requested for authorization to obtain DIP
financing of up to $1,000,000 from National Environmental,
pursuant to the proposed Replacement Promissory Grid Note and the
Restated Security Agreement.
As reported in the Troubled Company Reporter on March 27, 2013,
the Debtor won Court permission to borrow up to $500,000 from
National Environmental, and grant the DIP lender a first priority
lien on all new accounts and new general intangibles arising from
work performed using the DIP financing, as well as a first
priority lien on all personal property acquired by or earned by
the Debtor via purchase or lease using the proceeds of the DIP
financing or using proceeds of all new contract rights and
accounts.
Through the new motion, Mr. Brown said that the increased amount
of financing will assist the Debtor to begin to perform additional
new projects.
At the present time, National Environmental is proposing to lend
to the Debtor, solely at National Environmental's discretion, up
to $1,000,000, on a demand basis, with interest at a rate of
10 percent per annum, secured by all new accounts and new general
intangibles arising after the March 22, 2013 date of Court
approval of the Debtor's initial DIP Financing, as well as a first
priority lien on all personal property acquired by the Debtor via
purchase or lease using the proceeds of such financing or using
proceeds of all new contract rights and accounts.
About Demco Inc.
Demco, Inc., aka Decommissioning & Environmental Management
Company, is a specialty trade contractor based in West Seneca, New
York, which provides demolition services, nuclear work,
environmental clean-up, disaster response and a variety of other
services throughout the United States and, on a project-by-project
basis, internationally. Some of Demco's better known demolition
projects in the past have included the Rocky Flats Nuclear Power
Plant, Yankee Stadium, the Orange Bowl, Buffalo Memorial
Auditorium, and the Sunflower Army Ammunition Plant.
Demco filed for Chapter 11 protection (Bankr. W.D.N.Y. Case No.
12-12465) on Aug. 6, 2012. Bankruptcy Judge Michael J. Kaplan
presides over the case. Daniel F. Brown, Esq., at Andreozzi,
Bluestein, Fickess, Muhlbauer Weber, Brown, LLP, represents the
Debtor in its restructuring effort. Freed Maxick CPAs, P.C.
serves as its accountants, and Horizons Consulting, LLC, serves as
its tax consultants. The Debtor estimated assets and debts at $10
million to $50 million. The petition was signed by Michael J.
Morin, controller.
Tracy Hope Davis, the U.S. Trustee for Region 2, appointed three
creditors to serve on the Official Committee of Unsecured
Creditors.
First Niagara Bank, the cash collateral lender, is represented by
William F. Savino, Esq., at Damon Morey.
DETROIT, MI: Holes in Eligibility Ruling Aid Workers
----------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that although Detroit prevailed over workers and pension
funds in establishing the city's eligibility for a Chapter 9
municipal bankruptcy, some of the language in the bankruptcy
court's 143-page opinion leaves the door wide open to an appeal
contending that the judge made a fundamental legal error.
According to the report, U.S. Bankruptcy Judge Steven Rhodes said
Detroit "did not negotiate in good faith with creditors." His
finding by itself appears to represent non-compliance with Section
109(c)(5)(B) of the U.S. Bankruptcy Code requiring a city to
"negotiate in good faith with creditors" before seeking municipal
bankruptcy.
In the next breath, Judge Rhodes qualified himself by saying
Detroit was not required to negotiate "because such negotiation
was impracticable."
In their appeals, the American Federation of State, County and
Municipal Employees and two pension systems can argue that Detroit
in essence filed bankruptcy in bad faith, thus rendering the city
ineligible despite arguably satisfying another provision of the
statute allowing bankruptcy when negotiation are impracticable.
Otherwise, Judge Rhodes's written opinion on Dec. 5, filling in
details from the summary he delivered in open court two days
before, comes down firmly on the side of Detroit's eligibility for
municipal bankruptcy. For instance, he said that the workers'
argument about a violation of the Contracts Clause of the U.S.
Constitution "is frivolous."
Judge Rhodes similarly rejected arguments that federal municipal
bankruptcy law violates the 10th Amendment to the Constitution,
which reserves powers to the states that aren't delegated to the
federal government.
For starters, Judge Rhodes said the U.S. Supreme Court decided the
very same issue over seventy-five years ago in a case called
Bekins. That case "squarely rejects" the contention that municipal
bankruptcy is an unconstitutional violation of state sovereignty.
Even if Bekins weren't on the books, Judge Rhodes said Chapter 9
isn't unconstitutional either on its face or as applied to the
facts of Detroit's bankruptcy. Although the Michigan state
constitution gives protection to municipal workers' pensions,
Judge Rhodes said pension rights "are subject to impairment in a
federal bankruptcy proceeding."
To insure his ruling wasn't interpreted too broadly, Judge Rhodes
qualified himself by saying he won't necessarily "confirm any plan
of adjustment that impairs pensions." He assured workers he will
not "lightly or casually exercise the power under federal
bankruptcy law to impair pensions."
Regarding retirement benefits, Judge Rhodes recognized that
retirees, whose pensions range between $18,000 and $30,000,
"generally" don't have Social Security retirement or disability
benefits as a fallback. He said pensions are underfunded by $3.5
billion.
On the issue of good-faith negotiations before bankruptcy, Judge
Rhodes laid out the events in detail. Giving workers useful
language for appeal, Rhodes said a proposal given them in June did
not supply "sufficient information to make meaningful counter-
proposals." Also helpful for workers, he said "the lack of
negotiations were not due to creditor recalcitrance."
Judge Rhodes said Detroit nonetheless satisfied gating
requirements for Chapter 9 because "negotiations were in fact,
impracticable, even if the city had attempted good faith
negotiations."
The judge bolstered his conclusions by finding that the unions
"sent a clear message" they would not negotiate for retirees.
Likewise, several retiree associations "would never negotiate a
reduction" in pensions, he said.
Judge Rhodes laid down a rule useful if other large cities need
bankruptcy. Rather than make a pretext about negotiating, he said
the "law clearly permits" simply announcing there will be no talks
"because negotiating with so many diverse creditors is
impracticable."
Rebutting the contention that bankruptcy was a "foregone
conclusion," Judge Rhodes said "it hardly matters." He said
Detroit was no exception to the rule that bankruptcy often comes
too late. He said Detroit "probably should have" filed bankruptcy
"perhaps even years before."
Judge Rhodes even ruled on Michigan state law and the state
constitution. He said the state statute allowing appointment of
the emergency manager didn't violate the Michigan constitution.
As a bankruptcy judge, Judge Rhodes said he retains power to rule
on state-law issues so long as they deal with fundamental
bankruptcy issues. He rejected the idea that a 2011 Supreme Court
case called Stern v. Marshall should have prevented him from
ruling.
Just after Detroit filed bankruptcy, a state-court judge ruled
that filing bankruptcy was in violation of the state
constitutional protection for municipal pensions. Judge Rhodes
said that the prior bankruptcy filing took away power in the state
court "to determine any issue pertaining to the city's eligibility
to be a Chapter 9 debtor." Consequently, the state court ruling is
void, he said.
Whether and when unions and retirees appeal is yet to be decided.
Although they filed appeals, there is a question about whether
last week's ruling even gives rise to a right of appeal at this
time, without permission from Judge Rhodes or a district judge.
If there is an appeal at this juncture, the workers and retirees
want the case taken immediately to the U.S. Court of Appeals in
Cincinnati. To overstep an intermediate appeal in district court,
either Rhodes or a district judge must authorize a direct appeal
to the higher court, and the court of appeals must accept the
appeal.
The bankruptcy judge ruled that Detroit can use $12.5 million of
tax revenue a year so a lighting authority can finance
improvements in the street-lighting system. The judge delayed
ruling while deciding whether the authority's lawyers had a
conflict of interest by simultaneously representing the city.
About City of 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.
A nine-member official committee of retired workers was appointed
in the case. The Retirees' Committee is represented by Dentons US
LLP.
DETROIT, MI: $210-Mil. Street Lighting Plan Approved by Judge
-------------------------------------------------------------
JC Reindl, writing for The Detroit Free Press, reported that a
prominent pastor in Detroit's hard-hit Brightmoor neighborhood
says he's looking forward to functioning streetlights after U.S.
Bankruptcy Judge Steven Rhodes approved a $210-million financing
arrangement for overhauling the city's antiquated lighting system.
According to the report, the judge's order is expected to give
confidence to the credit markets to lend the repair money to
Detroit's new Public Lighting Authority.
The authority was formed as a separate entity from city government
because Detroit was too broke to borrow money on its own to
rebuild and downsize the 88,000-fixture street lighting system,
which has an estimated worst-in-the-nation outage rate of 40%, the
report related.
The repairs can't come soon enough for Brightmoor, which is near
the top of the lighting authority's priority list, the report
said.
The Rev. Larry Simmons of Baber Memorial AME Church said that
lights are out all over the neighborhood and recalled how some of
his church members have been robbed while walking the dark
streets, the report further related.
About City of 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.
A nine-member official committee of retired workers was appointed
in the case. The Retirees' Committee is represented by Dentons US
LLP.
DETROIT, MI: Donor Offers $5 Million to Help Protect Art
--------------------------------------------------------
John Gallagher, writing for The Detroit Free Press, reported that
a local philanthropist said he'll donate $5 million toward
protecting the Detroit Institute of Arts' renowned collection and
city retirees' pensions -- and he hopes to inspire others to give.
According to the report, millionaire A. Paul Schaap said he plans
to meet with U.S. Chief District Judge Gerald Rosen, who is
serving as mediator in Detroit's bankruptcy case. Judge Rosen has
been trying to persuade at least 10 charitable foundations to put
up $500 million to spin off the DIA from the city, which could
then use the money to reduce pension cuts and improve services.
"I have to believe there are more of us out there who want to do
something and didn't quite know how to approach it," Schaap said,
the report cited.
Schaap said he hoped his gift would stimulate major foundations to
agree to participate in the Rosen-mediated fund. So far, leaders
of 10 local and national foundations who have met with Judge Rosen
have yet to commit. One of Judge Rosen's goals is to turn the DIA
into an independent nonprofit free of city ownership and protected
from creditors seeking billions and pushing for the sale of city
assets.
U.S. Bankruptcy Judge Steven Rhodes ruled the city eligible for
bankruptcy, the report related. The best timing for any grand
bargain involving the DIA would be before emergency manager Kevyn
Orr submits his "plan of adjustment" for moving Detroit through
bankruptcy, including proposed pension cuts, sale of city assets
and major changes to how city services are delivered. Orr has said
his plan could be delivered by early January.
About City of 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.
A nine-member official committee of retired workers was appointed
in the case. The Retirees' Committee is represented by Dentons US
LLP.
DETROIT, MI: Retirees Committee Supports DIP Financing
------------------------------------------------------
The Official Committee of Retirees in the Chapter 11 cases of the
City of Detroit, Michigan, notified the Bankruptcy Court that it
supports the city's proposed $350 million bankruptcy loan.
Several arties-in-interest, meanwhile, have objected to the
postpetition financing.
Ryan Blaine Bennett, Esq., at Kirkland & Ellis LLP, on behalf of
Syncora Guarantee Inc., and Syncora Capital Assurance Inc., in
stated that the DIP Motion is unprecedented in Chapter 9 both in
its size and its scope. Disregarding the purpose of, and policies
behind, Chapter 9, the DIP motion is yet another attempt by the
City to hurriedly advance a complicated financial transaction that
addresses plan-related issues -- namely, the appropriate payouts
to creditors, the City's right to grant primary liens, and the
City's attempt to "kick-start" a 10-year, $1.25 billion spending
campaign funded by $650 million of Chapter 9-imposed creditor
losses.
National Public Finance Guarantee Corporation, a municipal bond
insurer and a creditor, stated that the financing motion must be
denied unless the concerns regarding reporting, and the
clarification related to the restricted funds raised by this
objection are resolved. National has two concerns: (i) the City
must be transparent in terms of how it spends the Quality of Life
Bonds proceeds (at the City's proposed pace of $20 million per
month) to enable Detroit's stakeholders to determine whether or
not the borrowed funds are being used on essential City services;
and (ii) if the Court approves the postpetition financing, the
proposed order must clarify that any superpriority claim pursuant
to 11 U.S.C. Section 364(c)3 granted in favor of the purchaser,
indenture trustee or bondholders will not be satisfied or payable
from the proceeds of ad valorem taxes levied or pledged
specifically to secure repayment of the unlimited tax general
obligation bonds, pending resolution of the issues raised in the
adversary proceeding.
National has insured several bonds totaling approximately $2.4
billion issued by the City of Detroit and City authorities,
including unlimited tax general obligation bonds, water supply
system bonds, and sewage disposal system bonds.
About City of 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.
A nine-member official committee of retired workers was appointed
in the case. The Retirees' Committee is represented by Dentons US
LLP.
DETROIT, MI: Emergency Manager Weighs Pension-Fund Takeover
-----------------------------------------------------------
Matthew Dolan, writing for The Wall Street Journal, reported that
Detroit City's emergency manager, in the midst of reorganizing the
finances of America's most troubled large city, is threatening to
take over one of Detroit's pension funds after a report found that
retirees received extra payments while the funds lost value.
According to the report, Kevyn Orr said in a recent interview that
at the current pace, the city's General Services System pension
fund could lose its ability to pay pensions owed to current and
future retirees within 12 years. A takeover is a "right, if not an
obligation, that I have to consider under the statute, and we're
considering that right now," he said.
Representatives of the pension board said Mr. Orr's figures were
faulty, the report related.
The talk of takeover comes as struggling cities and states across
the country are watching to see how Detroit will fare in cutting
its $18 billion in debt, including pension payments, as part of
the nation's largest municipal bankruptcy case, the report said.
The Oct. 25 draft report by the city's auditor general and
inspector general, which was reviewed by The Wall Street Journal,
found that during the 12 years ended in fiscal year 2012, the
pension funds paid $1.22 billion of interest credits into
retirees' savings accounts while the funds had losses of $2.05
billion, or 29% of their net asset value.
About City of 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.
A nine-member official committee of retired workers was appointed
in the case. The Retirees' Committee is represented by Dentons US
LLP.
DR. TATTOFF: Inks $7 Million Credit Facility with TCA Global
------------------------------------------------------------
Dr. Tattoff, Inc., and its subsidiaries, as borrowers, entered
into a Credit Agreement with TCA Global Credit Master Fund, LP,
for a credit facility of $7 million, with an initial loan of $1.3
million. The term of the loan is six months with two automatic
renewals of six months each as long as the loan is not in default.
The loan is secured pursuant to a Security Agreement that covers
all of the assets of the Company. Interest is at 10 percent per
annum, with a receipts collection fee that when added to the
interest on the note will not exceed 1.5 percent per month. There
are required principal payments of 2 percent of collections with
the balance of the loan due at maturity. The Credit Agreement
contains representations and warranties, affirmative, restrictive
and financial covenants, and events of default applicable to the
Company which are customary for credit facilities of this type.
A copy of the Credit Agreement is available for free at:
http://is.gd/Xjsa11
About Dr. Tattoff
Beverly Hills, Calif.-based Dr. Tattoff, Inc., currently operates
or provides management services to five laser tattoo and hair
removal clinics located in Texas and California, all of which
operate under the Company's registered trademark "Dr. Tattoff."
Dr. Tattoff disclosed a net loss of $2.83 million on $3.20 million
of revenue for the year ended Dec. 31, 2012, as compared with a
net loss of $2.47 million on $2.66 million of revenue during the
prior year. The Company's balance sheet at Sept. 30, 2013, showed
$2.12 million in total assets, $5.30 million in total liabilities,
and a $3.17 million total shareholders' deficit.
SingerLewak LLP, 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 current liabilities exceeded its current assets
by approximately $1,547,000, has shareholders' deficit of
approximately $806,000, has suffered recurring losses and negative
cash flows from operations, and has an accumulated deficit of
approximately $7,407,000 at Dec. 31, 2012, which conditions raise
substantial doubt about the Company's ability to continue as a
going concern.
DUMA ENERGY: Designates Series A 7% Convertible Preferred Stock
---------------------------------------------------------------
Duma Energy Corp.'s Articles of Incorporation at Article 8(iii)
vests in the Company's Board of Directors the authority to fix and
determine designations, preferences, privileges, rights and powers
and relative, participating, optional, or other special rights,
qualifications, limitations, or restrictions on the capital stock
of the Corporation. Pursuant to this authority the Company's
Board of Directors has designated Series A 7 Percent Convertible
Voting Preferred Stock. On Dec. 2, 2013, the Company filed a
Certificate of Designation with the Secretary of State of Nevada
designating up to 10,000 shares of the Preferred Stock.
The Preferred Stock has the following features:
-- a stated value of $400.00 per share
-- a cash dividend of 7 percent per annum
-- common stock equivalent voting power
-- conversion into common stock at a price of $2.00 per share
of common stock
A copy of the Certificate of Designation is available at:
http://is.gd/KidosB
About Duma Energy
Corpus Christi, Tex.-based Duma Energy Corp. --
http://www.duma.com/-- formerly Strategic American Oil
Corporation, is a growth stage oil and natural gas exploration and
production company with operations in Texas, Louisiana, and
Illinois. The Company's team of geologists, engineers, and
executives leverage 3D seismic data and other proven exploration
and production technologies to locate and produce oil and natural
gas in new and underexplored areas.
Duma Energy incurred a net loss of $40.47 million on $7.07 million
of revenues for the year ended July 31, 2013, as compared with a
net loss of $4.57 million on $7.16 million of revenues during the
prior year. As of July 31, 2013, the Company had $26.27 million
in total assets, $16.91 million in total liabilities and
$9.36 million in total stockholders' equity.
EDISON MISSION: Creditors Use Wilder to Chase Parent
----------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that creditors of Edison Mission Energy will be using C.
John Wilder, former chief executive officer of TXU Corp., to
assist in suing Edison Mission's non-bankrupt parent Edison
International Inc.
According to the report, under the pending Chapter 11
reorganization plan for independent power producer EME, a trust
will be created to file lawsuits on behalf of creditors, most
prominently holders of $3.7 billion in senior unsecured notes.
Parent Edison International is a primary target of upcoming suits.
In August the official committee of EME's unsecured creditors said
it uncovered claims against Edison International for fraudulent
transfers, illegal dividends, fraud, negligent misrepresentation,
and breach of fiduciary duty. Last month, EME said potential suits
against the parent include claims arising from "complex tax-
sharing agreements."
Lawyers for senior noteholders were authorized last week to hire
Wilder and his company Bluescape Advisors LLC to help analyze tax-
sharing claims. According to EME, using Wilder will provide an
"inside look," because he oversaw similar complicated arrangements
while at TXU.
EME's reorganization plan, revised this month, is based on a sale
of the business to NRG Energy Inc., the largest competitive power
producer in the U.S. There will be a Dec. 18 hearing for approval
of disclosure materials, so creditors can vote on the plan.
Princeton, New Jersey-based NRG will pay $2.635 billion, including
cash of $2.285 billion and $350 million in stock.
TXU was renamed Energy Future Holdings Corp. following the $43.2
billion leveraged buyout in October 2007 by KKR & Co. LP and TPG
Inc. Energy Future is in workout negotiations with its own
creditors.
EME's $1.196 billion in 7 percent senior unsecured notes maturing
in 2017 traded at 2:39 p.m. on Dec. 6 for 73.75 cents on the
dollar, up 40.5 percent from immediately before bankruptcy,
according to Trace, the bond-price reporting system of the
Financial Industry Regulatory Authority.
About Edison Mission
Santa Ana, California-based Edison Mission Energy is a holding
company whose subsidiaries and affiliates are engaged in the
business of developing, acquiring, owning or leasing, operating
and selling energy and capacity from independent power production
facilities. EME also engages in hedging and energy trading
activities in power markets through its subsidiary Edison Mission
Marketing & Trading, Inc.
EME was formed in 1986 and is an indirect subsidiary of Edison
International. Edison International also owns Southern California
Edison Company, one of the largest electric utilities in the
United States.
EME and its affiliates sought Chapter 11 protection (Bankr. N.D.
Ill. Lead Case No. 12-49219) on Dec. 17, 2012.
EME has reached an agreement with the holders of a majority of
EME's $3.7 billion of outstanding public indebtedness and its
parent company, Edison International EIX, that, pursuant to a plan
of reorganization and pending court approval, would transition
Edison International's equity interest to EME's creditors, retire
existing public debt and enhance EME's access to liquidity.
The Company's balance sheet at Sept. 30, 2012, showed
$8.17 billion in total assets, $6.68 billion in total liabilities
and $1.48 billion in total equity.
In its schedules, Edison Mission Energy disclosed total assets of
assets of $5,721,559,170 and total liabilities of $6,202,215,094
as of the Petition Date.
The Debtors other than Camino Energy Company are represented by
David R. Seligman, Esq., at Kirkland & Ellis LLP; and James H.M.
Sprayragen, Esq., at Kirkland & Ellis LLP. Counsel to Debtor
Camino Energy Company is David A. Agay, Esq., at McDonald Hopkins
LLC.
Perella Weinberg Partners is acting as the Debtors' financial
advisor and McKinsey & Company Recovery and Transformation
Services is acting as restructuring advisor. GCG, Inc., is the
claims and notice agent.
An official committee of unsecured creditors has been appointed in
the case and is represented by Ira S. Dizengoff, Esq., Stephen M.
Baldini, Esq., Arik Preis, Esq., and Robert J. Boller, Esq., at
Akin Gump Strauss Hauer & Feld LLP in New York; James Savin, Esq.,
and Kevin M. Eide, Esq., at Akin Gump Strauss Hauer & Feld LLP in
Washington, DC; and David M. Neff, Esq., and Brian Audette, Esq.,
at Perkins Coie LLP. The Committee also has tapped Blackstone
Advisory Partners as investment banker and FTI Consulting as
financial advisor.
EME said it doesn't plan to emerge from Chapter 11 until
December 2014 to receive benefits from a tax-sharing agreement
with parent Edison International Inc.
In November 2013, Edison Mission Energy filed a reorganization
plan to carry out a sale of its business to NRG Energy Inc. NRG,
based in Princeton, New Jersey, will pay $2.64 billion, including
$2.29 in cash billion and $350 million in stock. The plan calls
for secured creditors and unsecured creditors of the operating
companies to be paid in full. Unsecured creditors of Santa Ana,
California-based EME will split what remains of the purchase price
and the NRG stock. EME's subordinated creditors receive nothing
under the plan. The hearing to approve the disclosure statement
will take place Dec. 18.
ELBIT IMAGING: Gets NASDAQ Notification on Stockholders' Equity
---------------------------------------------------------------
Elbit Imaging Ltd. received a written notification from the
Listing Qualifications Department of The NASDAQ Stock Market LLC
on Dec. 4, 2013. The notification advised the Company that since
the Company's Form 6-K, filed on Nov. 27, 2013, for the period
ended Sept. 30, 2013, reported negative stockholders' equity of
$34,561,000, the Company no longer complies with the Nasdaq
Listing Rules since Nasdaq Listing Rule 5450(b)(1)(A) requires
companies listed on the Nasdaq Global Select Market to maintain a
minimum of $10,000,000 in stockholders' equity. The notification
also stated that the Company has until Jan. 21, 2014, to submit to
Nasdaq a plan to regain compliance with Rule 5450(b)(1)(A), and if
the plan is accepted Nasdaq can grant an extension of up to 180
calendar days from the date of the notification for the Company to
regain compliance.
The Company believes that upon the effectiveness of the Company's
proposed restructuring of its unsecured financial debt pursuant to
the proposed adjusted plan of arrangement, the Company's
stockholders' equity will be equal to or greater than $10,000,000
and will comply with the requirements of Nasdaq Listing Rule
5450(b)(1)(A). The Company intends to submit to Nasdaq an
explanation of the terms of the Arrangement and how upon its
effectiveness the Company would regain compliance with the rule.
In the event that the Company's plan to regain compliance is not
accepted or the Company does not regain compliance with the
requirements of Rule 5450(b)(1)(A) by the end of the applicable
compliance period, the Company's ordinary shares would be subject
to delisting.
About Elbit Imaging
Tel-Aviv, Israel-based Elbit Imaging Ltd. (TASE, NASDAQ: EMITF)
hold investments in real estate and medical companies. The
Company, through its subsidiaries, also develops shopping and
entertainment centers in Central Europe and invests in and manages
hotels.
Elbit Imaging disclosed a loss of NIS455.50 million on NIS671.08
million of total revenues for the year ended Dec. 31, 2012, as
compared with a loss of NIS247.02 million on NIS586.90 million of
total revenues for the year ended Dec. 31, 2011.
Brightman Almagor Zohar & Co., in Tel-Aviv, Israel, expressed
substantial doubt about Elbit Imaging's ability to continue as a
going concern following the financial results for the year ended
Dec. 31, 2012.
The Certified Public Accountants noted that in the period
commencing Feb. 1, 2013, through Feb. 1, 2014, the Company is to
repay its debenture holders NIS 599 million (principal and
interest). "Said amount includes NIS 82 million originally
payable on Feb. 21, 2013, that its repayment was suspended
following a resolution of the Company's Board of Directors. The
Company's Board also resolved to suspend any interest payments
relating to all the Company's debentures. In addition, as of
Dec. 31, 2012, the Company failed to comply with certain financial
covenants relating to bank loans in the total amount as of such
date of NIS 290 million.
The Company's balance sheet at Sept. 30, 2013, showed NIS4.83
billion in total assets, NIS4.96 billion in total liabilities and
a NIS122.24 million shareholders' deficiency.
Since February 2013, Elbit has intensively endeavoured to come to
an arrangement with its creditors. Elbit has said it has been
hanging by a thread for more than five months. It has encountered
cash flow difficulties and this burdens its day to day activities,
and it certainly cannot make the necessary investments to improve
its assets. In light of the arrangement proceedings, and according
to the demands of most of the bondholders, as well as an agreement
that was signed on March 19, 2013, between Elbit and the Trustees
of six out of eight series of bonds, Elbit is prohibited, inter
alia, from paying off its debts to the financial creditors -- and
as a result a petition to liquidate Elbit was filed, and Bank
Hapoalim has declared its debts immediately payable, threatening
to realize pledges that were given to the Bank on material assets
of the Company -- and Elbit undertook not to sell material assets
of the Company and not to perform any transaction that is not
during its ordinary course of business without giving an advance
notice to the trustees.
Accountant Rony Elroy has been appointed as expert for examining
the debt arrangement in the Company.
In July 2013, Elbit Imaging's controlling shareholders, Europe-
Israel MMS Ltd. and Mr. Mordechay Zisser, notified the Company
that the Tel Aviv District Court has appointed Adv. Giroa Erdinast
as a receiver with regards to the ordinary shares of the Company
held by Europe Israel securing Europe Israel's obligations under
its loan agreement with Bank Hapoalim B.M. The judgment stated
that the Receiver is not authorized to sell the Company's shares
at this stage. Following a request of Europe-Israel, the Court
also delayed any action to be taken with regards to the sale of
those shares for a period of 60 days. Europe Israel and Mr.
Zisser have also notified the Company that they utterly reject the
Bank's claims and intend to appeal the Court's ruling.
ELBIT VISION: Avi Gross, et al., to Sell 49.7MM Ordinary Shares
---------------------------------------------------------------
Elbit Vision Systems Ltd. filed with the U.S. Securities and
Exchange Commission a Form F-1 registration statement relating to
the resale by Sam Cohen, Yaron Menashe and Avi Gross of up to
49,764,670 ordinary shares.
The Company will not receive any of the proceeds from sales of the
ordinary shares made by the selling shareholders pursuant to this
prospectus.
The Company's ordinary shares currently trade on the OTC Bulletin
Board under the symbol "EVSNF". On Dec. 3, 2013, the closing
price of the Company's ordinary shares was $0.07 per share.
A copy of the Form F-1 prospectus is available for free at:
http://is.gd/r4cqS5
About Elbit Vision
Based in Caesarea, Israel, Elbit Vision Systems Ltd. (OTC BB:
EVSNF.OB) offers a broad portfolio of automatic State-of-the-Art
Visual Inspection Systems for both in-line and off-line
applications, and process monitoring systems used to improve
product quality, safety, and increase production efficiency.
The Company reported income of US$824,000 in 2012, as compared
with income of US$1.08 million in 2011. The Company's balance
sheet at June 30, 2013, showed $3.49 million in total assets,
$3.47 million in total liabilities and $19,000 shareholders'
equity.
ENDO HEALTH: Moody's to Withdraw Ba1 Sec. Loan Rating at Closing
----------------------------------------------------------------
Moody's Investors Service assigned a rating of Ba1 to the new
senior secured credit facilities of Endo Luxembourg Finance I
Company S.a.r.l., guaranteed by Endo Health Solutions Inc. There
are no changes to Endo's existing ratings including the Ba3
Corporate Family Rating, the Ba3-PD Probability of Default Rating,
and the B1 senior unsecured rating. The rating outlook remains
negative.
Proceeds from the new term loans will be used to refinance
existing bank debt in conjunction with Endo's pending acquisition
of Paladin Labs Inc. The rating on the senior secured bank
facilities also reflects Moody's anticipation of an upcoming
senior unsecured note offering of approximately $375 million,
which the rating agency anticipates rating B1, similar to Endo's
existing senior unsecured notes.
Ratings assigned to Endo Luxembourg Finance I Company S.a.r.l.:
Ba1 (LGD 2, 20%) senior secured Term Loan A of $1.1 billion
Ba1 (LGD 2, 20%) senior secured Term Loan B of $375 million
Ba1 (LGD 2, 20%) senior secured Revolving Credit Facility of $750
million
Ratings of Endo Health Solutions Inc. to be withdrawn at close:
Ba1 (LGD2, 21%) senior secured bank term loan and revolving credit
facilities
Upon close of the transaction, Moody's anticipates withdrawing the
ratings on the existing revolver and term loans subject to review
of final documentation. In addition, Moody's anticipates moving
the Corporate Family Rating to Endo Luxembourg Finance I Company
S.a.r.l.
Ratings Rationale:
Endo's Ba3 Corporate Family Rating reflects its modest size and
scale relative to larger pharmaceutical peers, partially offset by
the company's solid market positioning as a niche player in the
pain and urology markets and by its revenue diversity across
branded drugs, generic drugs and medical devices. Endo's expertise
in pain drugs and its good compliance with US Drug Enforcement
Agency (DEA) regulations act as high barriers to entry, also a
credit strength. Moody's views the Paladin acquisition as credit-
positive because Endo will gain EBITDA and cash flow as well as
improved revenue diversity without any substantial increase in
debt. Further, Endo will re-incorporate in Ireland, providing tax
savings that will be reflected in Endo's future cash flow.
However, Endo faces a significant challenge reviving top-line
growth because of generic pressures affecting two branded
franchises (Lidoderm and Opana ER) and softness in medical
procedure volumes. Endo also faces rising exposure to lawsuits
related to the surgical mesh products of its subsidiary, American
Medical Systems. Amidst these pressures, Endo is undergoing
significant cost reduction initiatives following recent changes in
senior leadership. Business development could result in higher
debt levels, but the Ba3 rating incorporates Moody's expectation
that debt/EBITDA will be sustained within a range of 3.0 to 4.0
times.
The rating outlook is negative. Despite the credit-positive nature
of the Paladin transaction described above, Moody's does not yet
believe that Endo's credit profile has fully stabilized because of
downward EBITDA trends, exposure to surgical mesh litigation, and
the uncertainty created by a dynamic M&A strategy. Although not
expected in the near term, Moody's could upgrade Endo's ratings if
the company restores internal growth rates and reduces litigation
uncertainties while sustaining conservative credit metrics
including gross debt/EBITDA below 3.0 times. Conversely, Moody's
could downgrade Endo's ratings if gross debt/EBITDA is sustained
above 4.0 times. This scenario could occur if Endo performs debt-
financed acquisitions, faces substantial litigation cash outflows,
or suffers worse-than-expected operating setbacks on products like
Lidoderm or Opana ER.
Headquartered in Malvern, Pennsylvania, Endo Health Solutions is a
U.S.-focused specialty healthcare company offering branded and
generic pharmaceuticals, medical devices and services. Endo's key
areas of focus include pain management, urology, oncology and
endocrinology. For the 12 months ended September 30, 2013 Endo
reported net revenues of approximately $3.0 billion.
EMCOR GROUP: S&P Raises Corp. Credit Rating From 'BB+'
------------------------------------------------------
Standard & Poor's Ratings Services said that it raised its
corporate credit rating on U.S.-based electrical and mechanical
construction and facilities services firm EMCOR Group Inc. to
'BBB-' from 'BB+'. At the same time, S&P removed the rating from
CreditWatch, where it placed it with positive implications on
Nov. 26, 2013. The outlook is stable.
"The upgrade primarily follows our reassessment of the company's
financial risk profile to 'modest' from 'intermediate' and
reflects our view of its maintainable cash flow and leverage
ratios despite potential volatility," Standard & Poor's credit
analyst Robyn Shapiro. "The upgrade also reflects our view that
EMCOR is likely to maintain cash on its balance sheet, even though
we believe that the company will continue making bolt-on
acquisitions to further diversify its service offerings." EMCOR's
credit ratios are strong, but S&P believes there is potential for
a high level of volatility in its free operating cash flow (FOCF)
and credit ratios over the industry cycle, which is an important
factor in S&P's "modest" financial risk profile assessment.
The stable outlook reflects S&P's view that low debt balances,
along with steady small and midsize project demand and improving
industrial markets, should allow EMCOR to preserve its debt
leverage ratios, while allowing for dividend distributions, bolt-
on acquisitions, and maintaining cash balances.
An upgrade is unlikely during the next 12-18 months, but it could
occur if the company's business risk profile improves to
"satisfactory," if, for example, acquisitions and organic growth
provide a more diverse earnings stream.
A downgrade also appears unlikely in the near term. However, a
downgrade could occur if EBITDA growth from EMCOR's small and
midsize projects does not broadly offset erosion from
sequestration and the nonresidential construction market, or if
acquisitions or more aggressive shareholder policies increase debt
to EBITDA to more than 2x over a prolonged period.
EMERITO ESTRADA: Chapter 11 Plan Deadline Extended to March
-----------------------------------------------------------
At the behest of Emerito Estrada Rivera Isuzu De PR Inc., Judge
Enrique S. Lamoutte Inclan granted a 60-day extension of the
Debtor's deadline to file a Chapter 11 plan and disclosure
statement. The Debtor sought an extension of the Dec. 2 deadline
because it still hasn't perfected the lease agreements that will
generate the funds to fuel its plan of reorganization. The
Debtor's counsel, Alexis Fuentes-Hernandez, Esq., was also slated
to take a vacation from Nov. 21, 2013 until Dec. 3, 2013, outside
Puerto Rico. This was the second extension granted to the Debtor.
About Emerito Estrada
Emerito Estrada Rivera Isuzu De PR Inc., a car dealer in Puerto
Rico, filed a bare-bones Chapter 11 petition (Bankr. D.P.R. Case
No. 13-04608) in Old San Juan, on June 4, 2013. Alexis Fuentes
Hernandez, Esq., at Fuentes Law Offices, serves as counsel. The
Debtor says its sole asset is a real property is worth $16.5
million. It has $8.68 million in liabilities, of which $8.1
million is secured.
The Debtor disclosed $23,860,000 in assets and $16,285,186 in
liabilities as of the Chapter 11 filing.
EQUIPOWER RESOURCES: S&P Affirms 'BB' Rating on $1.4BB Notes
------------------------------------------------------------
Standard & Poor's Rating Services said it affirmed its 'BB' issue
rating on EquiPower Resources Holdings LLC's $1.4 billion of
first-lien term loans and $146 million first lien revolving credit
and letter of credit facility. The outlook is stable. The '1'
recovery rating is unchanged.
The rating affirmation reflects the modest weakening in near-term
financial ratios such as debt per kilowatt (kW) and debt service
coverage that the incremental debt will cause. Over time, due to
the relative certainty provided by the capacity markets over the
next three years in PJM and in Independent System Operator (ISO)-
New England, where all of EquiPower Resources' assets are located,
these ratios tend to converge with those expected before this
latest acquisition. The 464 MW simple-cycle Richland/Stryker
generation assets (RSG) are peaking assets located in the
constrained ATSI region of western PJM. The nameplate capacities
are 444 MW for the six-unit Richland facility, and 20 MW for the
single oil-fired Stryker turbine. The capacity factor for these
units is not expected to exceed single digits; however, longer
term capacity factors may strengthen depending on the level of
fossil asset retirements in the ATSI and neighboring regions.
Because the assets are in PJM, there is as good price visibility
as any market offers, through April 2017. Therefore, reliability
and plant availability are critical, as are future capacity
prices, to future financial performance. With respect to
reliability, the assets have performed well over the past five
years.
The 'BB' rating results from having an overall competitive
portfolio of natural gas-fired power plants operating in ISO-New
England and in PJM. S&P believes that the projected debt burden
at maturity of about $159 per kW on a consolidated basis under its
rated case assumptions is likely re-financeable on reasonable
terms. Although the addition of the RSG assets brings some
enhanced asset diversity, the units are peaking plants and add a
relatively small proportion to overall merchant cash flows.
"The stable outlook reflects predictable cash flows from hedges,
modestly enhanced exposure to capacity prices in the PJM region,
and expectations of sustained strong operational results from the
assets," said Standard & Poor's credit analyst Richard Cortright.
"We see more downside risk than upward momentum for credit
quality. In our view, the age of some assets compared with peers
may cause operational challenges such as more frequent forced
outages than currently estimated, or availability that is lower
than expected. Ratings may also be affected if Kincaid needed
greater environmental compliance-related investment. A downgrade
is possible if merchant revenues suffered from factors such as
weaker-than-expected spark spreads or operational performance, or
higher operating and maintenance costs that led to expected debt
at maturities being greater than about $250 per kW or DSCR
declining below 1.3x on a steady basis," S&P noted.
An upgrade is unlikely given the high initial leverage, and would
require a large and sustainable improvement in merchant market
prices that would lead to refinancing risk of below $100 per kW
and debt service coverage levels consistently above 1.75x.
EXIDE TECHNOLOGIES: Hires Ernst & Young as Tax Services Provider
----------------------------------------------------------------
Exide Technologies Inc. seeks authorization from the Hon. Kevin J.
Carey of the U.S. Bankruptcy Court for the District of Delaware to
employ Ernst & Young LLP as tax advisory, valuation, accounting
and reporting services provider, nunc pro tunc to Nov. 21, 2013.
Pursuant to the Tax Advisory statement of work, Ernst & Young will
provide certain services to the Debtor, including:
-- working with the appropriate Debtor personnel and the
Debtor's outside legal counsel to develop an understanding
of the tax issues and alternatives associated with the
Debtor's Chapter 11 filing, restructuring, or other plan,
taking into account the Debtor's specific facts and
circumstances, for indirect tax purposes. Indirect taxes may
include franchise taxes, property tax, sales tax, use tax,
employment and payroll taxes, unemployment taxes, excise
taxes, and incentives;
-- providing indirect tax advisory services with issues arising
in the ordinary course of business while in bankruptcy, such
as ongoing assistance with state and local tax examinations,
and, as needed, research, discussions and analysis of
indirect state and local tax issues arising during the
bankruptcy period;
-- providing tax advisory services regarding indirect tax
aspects of the bankruptcy process, the validity and amount
of bankruptcy indirect tax claims, and tax advisory support
in securing indirect tax refunds during the pendency of the
bankruptcy;
-- assisting and advising in securing rulings from applicable
state/local tax authorities with respect indirect taxes;
-- preparing documentation, as appropriate or necessary, of tax
analysis, opinions, recommendations, conclusions and
correspondence for any proposed restructuring alternative,
bankruptcy tax issue or other tax matter described herein.
Pursuant to the Valuation, Accounting and Reporting statement of
work, Ernst & Young will provide certain services to the Debtor,
including the following:
-- Ernst & Young anticipates performing the following
procedures and tasks in its valuation analysis:
* perform interviews with senior management of the Debtor;
* give consideration to applicable economic, industry, and
Competitive environments, including relevant historical
and future estimated trends;
* apply the Income, Market and Cost approaches to value
using, where appropriate, financial data that is based on
a market participant perspective; and
* prepare a narrative report summarizing the methodologies
employed in Ernst & Young's analysis, the assumptions on
which Ernst & Young's analysis was based, and Ernst &
Young's recommendations of fair value.
-- Ernst & Young anticipates performing the following
procedures and tasks in its valuation analysis of the
business enterprise of the reporting units:
* valuation analysis of the business enterprise of each
reporting unit for allocating residual goodwill; and
* apply the Income approach to value the reporting units,
specifically the discounted cash flow method.
-- Ernst & Young anticipates performing the following
procedures and tasks in its valuation analysis of the
intangible assets:
* interview management and review documentation to assist
the Company in its identification of the significant
intangible assets of the business. Ernst & Young
anticipates the following types of intangible assets:
(a) customer relationships and customer backlog,
(b) trademarks/trade names, both definite and indefinite
lived,
(c) technology, and
(d) assembled workforce;
* collect data and hold discussions with management to
obtain the information and assumptions needed to value the
intangible assets; and
* analyze and value the intangible assets by reporting unit
using the following methodologies:
(a) relief from royalty method,
(b) multi-period excess earnings method, and
(c) cost to replace method.
-- Ernst & Young anticipates performing the following
procedures and tasks in its valuation analysis of inventory:
* collect data and hold discussions with management to
understand the nature of the inventory held by each
reporting unit; and
* analyze and value the inventory using the following
methodologies:
(a) finished goods at estimated selling prices less costs
of disposal and a reasonable profit on the selling
effort,
(b) work in process at estimated selling prices less cost
to complete, cost of disposal and a reasonable profit
on both the remaining completion effort and the
selling effort,
(c) raw materials at current replacement cost.
-- Ernst & Young anticipates performing the following
procedures and tasks in its valuation analysis of real
property:
* collect data on the size, use, construction type for the
10 largest manufacturing facilities;
* perform market research on land values, market rents and
local market conditions, and building/site improvement
replacement costs for each market; and
* value the land and ten largest buildings at the 10 largest
manufacturing facilities using a combination of the cost,
income, and sales comparison approaches, as appropriate.
Ernst & Young will estimate separate values for the land,
building improvements, and site improvements at each
location.
Leases, distribution centers, and vacant/excess land parcels will
be excluded from Ernst & Young's valuation. All valuation
procedures and assumptions are based on good, reliable fixed asset
data and open communication between Ernst & Young and Exide
engineering and accounting teams.
Ernst & Young anticipates performing the following procedures and
tasks in its valuation analysis of real property:
* personal property assets will be valued primarily
utilizing the indirect method of the cost approach. The
direct method of the cost approach will be used on a
limited basis as needed;
* construction in progress will be included at book value;
and
* Ernst & Young will perform 4 site inspections, 2 domestic
and 2 international, which will attempt to represent each
business segment and facility type.
Ernst & Young's valuation scope excludes any work related to
analyses around liquidation studies for floor values, held for
sale studies, dismantlement studies, transfer studies, etc.
-- Ernst & Young will also perform the following accounting
assistance:
* assist with preparation of an overall fresh-start
accounting project timeline;
* assist with the preparation of the fresh-start accounting
required work steps, including project management support,
resource needs, and status updates on at least a weekly
basis;
* assist with the technical fresh-start accounting and
Reporting requirements, including the identification of
accounts impacted by fresh-start accounting and the fresh-
start reporting date, and discussions with external
auditors. This may include providing examples of fresh-
start accounting disclosures, publications or examples of
the application of fresh-start accounting, or other
information that may assist management with the
application of fresh-start accounting;
* based on the valuation studies and appraisals, assist the
Company with the fresh-start accounting adjustments in
accordance with U.S. GAAP, including system needs and
recording of entries to the ledgers and sub-ledgers;
* assist with the subsequent accounting for the fresh-start
Accounting adjustments; and
* assist on any other miscellaneous matters requested in
connection with Exide Technology's application of fresh-
start accounting.
Ernst & Young will be paid at these hourly rates:
Tax Advisory Services
---------------------
Partner/Principal/Executive Director $675
Senior Manager $495
Manager $425
Senior $290
Staff $205
National Partner/Principal/
Executive Director $770
National Senior Manager $680
National Manager $585
National Senior $480
National Staff $375
Valuation Services
------------------
Partner/Principal $482
Executive Director $410
Senior Manager $393
Manager $315
Experienced Senior $237
Senior $212
Experienced Staff $161
Staff $129
Client Serving Associate $79
Accounting and Reporting Services
---------------------------------
Partner/Principal/
Executive Director $500-$800
Senior Manager $400-$550
Manager $350-$450
Senior $250-$350
Ernst & Young will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Patrick J. Gunning, partner of Ernst & Young, assured the Court
that the firm is a "disinterested person" as the term is defined
in Section 101(14) of the Bankruptcy Code and does not represent
any interest adverse to the Debtors and their estates.
The Court for the District of Delaware will hold a hearing on the
application on Dec. 18, 2013, at 10:00 a.m. Objections, if any,
are due Dec. 11, 2013, at 4:00 p.m.
Ernst & Young can be reached at:
Patrick J. Gunning
ERNST & YOUNG LLP
Suite 1000, 55 Ivan Allen Jr. Blvd.
Atlanta, GA 30308
Tel: (404) 874-8300
Fax: (404) 817-5589
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 returned to Chapter 11 bankruptcy (Bankr. D. Del. Case No.
13-11482) on June 10, 2013.
For the new case, Exide has tapped Anthony W. Clark, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, and Pachulski Stang
Ziehl & Jones LLP as counsel; Alvarez & Marsal as financial
advisor; Sitrick and Company Inc. as public relations consultant
and GCG as claims agent.
The Debtor disclosed $1.89 billion in assets and $1.14 billion in
liabilities as of March 31, 2013.
Exide's international operations were not included in the filing
and will continue their business operations without supervision
from the U.S. courts.
The Official Committee of Unsecured Creditors is represented by
Lowenstein Sandler LLP and Morris, Nichols, Arsht & Tunnell LLP as
co counsel. Zolfo Cooper, LLC serves as its bankruptcy
consultants and financial advisors.
FIBERTOWER CORP: Creditors Allowed to Begin Voting on Plan
----------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that FiberTower Corp. modified its Chapter 11
reorganization plan, prompting the bankruptcy court in Fort Worth,
Texas to approve disclosure materials allowing creditors to vote.
According to the report, a confirmation hearing for approval of
the plan will be held on Jan. 15.
The plan will give all the new common stock to holders of the
remaining $98 million in first-lien notes due 2016. The lenders'
recovery is a predicted 5.3 percent to 7.6 percent, according to
the court-approved disclosure statement.
The company will continue litigating with the aim of recovering
frequency licenses the U.S. Federal Communications Commission
terminated last year.
The holders of the notes were paid down almost $34 million. If the
$34 million is included, the noteholders will have recovered 30.9
percent to 33.2 percent.
Holders of $30 million in convertible notes due 2012 aren't
predicted to recover anything because their liens are subordinate
to the 2016 notes. Similarly, unsecured creditors with claims
ranging from $4.4 million to $12.2 million are predicted to have
no dividend.
FiberTower has 49 remaining licenses and is in litigation with the
FCC to take back 691 licenses the commission terminated last year
because the company hadn't developed them. FiberTower paid more
than $100 million for the licenses.
The notes due in 2016 traded on Aug. 15 for 1 cent on the dollar,
according to Trace, the bond-price reporting system of the
Financial Industry Regulatory Authority. They traded for just
under 10 cents in June.
About FiberTower Corp.
FiberTower Corporation, FiberTower Network Services Corp.,
FiberTower Licensing Corp., and FiberTower Spectrum Holdings
LLC filed for Chapter 11 protection (Bankr. N.D. Tex. Case Nos.
12-44027 to 12-44031) on July 17, 2012, together with a plan
support agreement struck with prepetition secured noteholders.
FiberTower is an alternative provider of facilities-based backhaul
services, principally to wireless carriers, and a national
provider of millimeter-band spectrum services. Backhaul is the
transport of voice, video and data traffic from a wireless
carrier's mobile base station, or cell site, to its mobile
switching center or other exchange point. FiberTower provides
spectrum leasing services directly to other carriers and
enterprise clients, and also offer their spectrum services through
spectrum brokerage arrangements and through fixed wireless
equipment partners.
FiberTower's significant asset is the ownership of a national
spectrum portfolio of 24 GHz and 39 GHz wide-area spectrum
licenses, including over 740 MHz in the top 20 U.S. metropolitan
areas and, in the aggregate, roughly 1.72 billion channel pops
(calculated as the number of channels in a given area multiplied
by the population, as measured in the 2010 census, covered by
these channels). FiberTower believes the Spectrum Portfolio
represents one of the largest and most comprehensive collections
of millimeter wave spectrum in the U.S., covering areas with a
total population of over 300 million.
As of the Petition Date, FiberTower provides service to roughly
5,390 customer locations at 3,188 deployed sites in 13 markets
throughout the U.S. The fixed wireless portion of these hybrid
services is predominantly through common carrier spectrum in the
11, 18 and 23 GHz bands. FiberTower's biggest service markets are
Dallas/Fort Worth and Washington, D.C./Baltimore, with additional
markets in Atlanta, Boston, Chicago, Cleveland, Denver, Detroit,
Houston, New York/New Jersey, Pittsburgh, San Antonio/Austin/Waco
and Tampa.
As of June 30, 2012, FiberTower's books and records reflected
total combined assets, at book value, of roughly $188 million and
total combined liabilities of roughly $211 million. As of the
Petition Date, FiberTower had unrestricted cash of roughly $23
million. For the six months ending June 30, 2012, FiberTower had
total revenue of roughly $33 million. With the help of FTI
Consulting Inc., FiberTower's preliminary valuation work shows
that the Company's enterprise value is materially less than $132
million -- i.e., the approximate principal amount of the 9.00%
Senior Secured Notes due 2016 outstanding as of the Petition Date.
The preliminary valuation work is based upon the assumption that
FiberTower's spectrum licenses will not be terminated. Fibertower
Spectrum disclosed $106,630,000 in assets and $175,501,975 in
liabilities as of the Chapter 11 filing.
Judge D. Michael Lynn oversees the Chapter 11 case. Lawyers at
Andrews Kurth LLP serve as the Debtors' lead counsel. Lawyers at
Hogan Lovells and Willkie Farr and Gallagher LLP serve as special
FCC counsel. FTI Consulting serve as financial advisor. BMC
Group Inc. serve as claims and noticing agent. The petitions were
signed by Kurt J. Van Wagenen, president.
Wells Fargo Bank, National Association -- as indenture trustee and
collateral agent to the holders of 9.00% Senior Secured Notes due
2016 owed roughly $132 million as of the Petition Date -- is
represented by Eric A. Schaffer, Esq., at Reed Smith LLP. An Ad
Hoc Committee of Holders of the 9% Secured Notes Due 2016 is
represented by Kris M. Hansen, Esq., and Sayan Bhattacharyya,
Esq., at Stroock & Stroock & Lavan LLP. Wells Fargo and the Ad
Hoc Committee also have hired Stephen M. Pezanosky, Esq., and Mark
Elmore, Esq., at Haynes and Boone, LLP, as local counsel.
U.S. Bank, National Association -- in its capacity as successor
indenture trustee and collateral agent to holders of the 9.00%
Convertible Senior Secured Notes due 2012, owed $37 million as of
the Petition Date -- is represented by Michael B. Fisco, Esq., at
Faegre Baker Daniels LLP, as counsel and J. Mark Chevallier, Esq.,
at McGuire Craddock & Strother PC as local counsel.
William T. Neary, the U.S. Trustee for Region 6 appointed five
members to the Official Committee of Unsecured Creditors in the
Debtors' cases. The Committee is represented by Otterbourg,
Steindler, Houston & Rosen, P.C., and Cole, Schotz, Meisel, Forman
& Leonard, P.A. Goldin Associates, LLC serves as its financial
advisors.
On March 15, 2013, the Court entered an order authorizing the
Debtors to sell assets that are primarily utilized by the Debtors
to provide wireless backhaul services in the State of Ohio to
Cellco Partnership (dba Verizon Wireless) free and clear for $1.5
million.
In May 2013, FiberTower sought and obtained Court authority to
sell their telecommunications equipment and employ American
Communications, LLC, as telecommunications equipment reseller.
According to the Debtors, the telecommunications equipment, which
was a part of their backhaul business, is no longer necessary in
the conduct of their business. They, however, believe that the
equipment may have resale value that would benefit their estates.
FINJAN HOLDINGS: Files Copy of the Presentation with SEC
--------------------------------------------------------
Finjan Holdings, Inc., held a presentation for certain
stockholders, potential investors and their representatives
regarding the business and historical and projected performance of
the Company. A copy of the presentation is available at:
http://is.gd/UrxSNp
About Finjan
Finjan, formerly known as Converted Organics, is a leading online
security and technology company which owns a portfolio of patents,
related to software that proactively detects malicious code and
thereby protects end-users from identity and data theft, spyware,
malware, phishing, trojans and other online threats. Founded in
1997, Finjan is one of the first companies to develop and patent
technology and software that is capable of detecting previously
unknown and emerging threats on a real-time, behavior-based basis,
in contrast to signature-based methods of intercepting only known
threats to computers, which were previously standard in the online
security industry.
Converted Organics disclosed a net loss of $8.42 million in 2012,
as compared with a net loss of $17.98 million in 2011. Finjan
Holdings's balance sheet at Sept. 30, 2013, showed $30.35
million in total assets, $927,000 in total liabilities and $29.42
million in total stockholders' equity.
Moody, Famiglietti & Andronico, LLP, in Tewksbury, Massachusetts,
issued a "going concern" qualification on the consolidated
financial statements for the year ended Dec. 31, 2012, citing
recurring losses and negative cash flows from operations and an
accumulated deficit that raises substantial doubt about the
Company's ability to continue as a going concern.
FIRST NATIONAL: Settles Shareholder Derivative Action
-----------------------------------------------------
First National Community Bancorp, Inc., the parent company of
Dunmore-based First National Community Bank, has entered into a
Stipulation of Settlement to settle derivative claims filed
against certain current and former directors of the Company in the
Court of Common Pleas in Lackawanna County and in which action the
Company was named as a nominal defendant.
By entering into the Stipulation of Settlement, the settling
parties have resolved the derivative claims to their mutual
satisfaction. The settling defendants have not admitted the
validity of any claims or allegations and the settling plaintiffs
have not admitted that any claims or allegations lack merit or
foundation. Under the terms of the Stipulation of Settlement, the
parties have agreed to the payment of a settlement sum to the
Company and the Company has agreed to certain corporate governance
enhancements, including the addition of two independent directors
to the Company's board of directors and certain board committee
enhancements with respect to risk management and oversight.
The Stipulation of Settlement remains subject to approval by the
Court after notice to the Company's shareholders and a settlement
hearing.
A copy of the Stipulation is available for free at:
http://is.gd/zg7TvK
About First National
Headquartered in Dunmore, Pa., First National Community Bancorp,
Inc., is a Pennsylvania corporation, incorporated in 1997 and is
registered as a bank holding company under the Bank Holding
Company Act ("BHCA") of 1956, as amended. The Company became an
active bank holding company on July 1, 1998, when it acquired
ownership of First National Community Bank (the "Bank"). The Bank
is a wholly-owned subsidiary of the Company.
The Company's primary activity consists of owning and operating
the Bank, which provides customary retail and commercial banking
services to individuals and businesses. The Bank provides
practically all of the Company's earnings as a result of its
banking services.
First National disclosed a net loss of $13.71 million on $37.02
million of total interest income for the year ended Dec. 31, 2012,
as compared with a net loss of $335,000 on $42.93 million of total
interest income in 2011. The Company's balance sheet at Sept. 30,
2013, showed $978.52 million in total assets, $945.72 million in
total liabilities and $32.79 million in total shareholders'
equity.
Regulatory Matters
The Bank is under a Consent Order from the Office of the
Comptroller of the Currency dated Sept. 1, 2010. The Company is
also subject to a Written Agreement with the Federal Reserve Bank
of Philadelphia dated Nov. 24, 2010.
The Bank, pursuant to a Stipulation and Consent to the Issuance of
a Consent Order dated Sept. 1, 2010, without admitting or denying
any wrongdoing, consented and agreed to the issuance of the Order
by the OCC, the Bank's primary regulator. The Order requires the
Bank to undertake certain actions within designated timeframes,
and to operate in compliance with the provisions thereof during
its term. The Order is based on the results of an examination of
the Bank as of March 31, 2009. Since the examination, management
has engaged in discussions with the OCC and has taken steps to
improve the condition, policies and procedures of the Bank.
Compliance with the Order is monitored by a committee of at least
three directors, none of whom is an employee or controlling
shareholder of the Bank or its affiliates or a family member of
any such person. The Committee is required to submit written
progress reports on a monthly basis to the OCC and the Agreement
requires the Bank to make periodic reports and filings with the
Federal Reserve Bank. The members of the Committee are John P.
Moses, Joseph Coccia, Joseph J. Gentile and Thomas J. Melone.
Banking regulations also limit the amount of dividends that may be
paid without prior approval of the Bank's regulatory agency. At
Dec. 31, 2012, the Company and the Bank are restricted from paying
any dividends, without regulatory approval.
FNBH BANCORP: Amends Articles to Create Series of Preferred Stock
-----------------------------------------------------------------
FNBH Bancorp, Inc., amended its Articles of Incorporation by
filing a Certificate of Designation of Mandatorily Convertible
Non-Cumulative Junior Participating Preferred Stock, Series B, of
FNBH Bancorp, Inc.
The Certificate was filed to create a series of preferred stock of
the Company for issuance by the Company in connection with a
private placement transaction.
The Certificate designates 20,000 shares of the Company's
authorized preferred stock as a new series of Mandatorily
Convertible Non-Cumulative Junior Participating Preferred Stock,
Series B. The Certificate was adopted by the Board of Directors
pursuant to the authority granted in the Company's Articles of
Incorporation. The Series B Shares are convertible into shares of
the Company's common stock at a rate reflecting a price per share
of common stock of $0.70, subject to certain anti-dilution
adjustments. The conversion into common stock will take place
automatically upon the approval by the Company's shareholders of
additional shares of authorized common stock. Until converted
into common stock, the Series B Shares will have terms that will
be substantially identical to the terms applicable to the
outstanding common stock with respect to dividends, distributions,
voting, and other matters. For matters submitted to a vote of the
holders of the Company's common stock, including the proposal to
authorize additional shares of common stock, the Series B Shares
will vote with the common stock, as a single class, as if the
Series B Shares were already converted into common stock.
A copy of the Certificate of Designation is available at:
http://is.gd/6Qogwp
About FNBH Bancorp
Howell, Michigan-based FNBH Bancorp, Inc., is a one-bank holding
company, which owns all of the outstanding capital stock of First
National Bank in Howell. The Bank was originally organized in
1934 as a national banking association. As of Dec. 31, 2011, the
Bank had approximately 85 full-time and part-time employees. The
Bank serves primarily five communities, Howell, Brighton, Green
Oak Township, Hartland, and Fowlerville, all of which are located
in Livingston County.
FNBH disclosed net income of $329,000 in 2012, as compared with a
net loss of $3.57 million in 2011. The Company's balance sheet at
Sept. 30, 2013, showed $301.79 million in total assets, $292.65
million in total liabilities and $9.14 million in total
shareholders' equity.
BDO USA, LLP, in Grand Rapids, Michigan, issued a "going concern"
qualification on the consolidated financial statements for the
year ended Dec. 31, 2012.
"The Corporation's subsidiary bank ("Bank") is significantly
undercapitalized under regulatory capital guidelines and, during
2009, the Bank entered into a consent order regulatory enforcement
action ("consent order") with its primary regulator, the Office of
the Comptroller of the Currency. The consent order requires
management to take a number of actions, including, among other
things, increasing and maintaining its capital levels at amounts
in excess of the Bank's current capital levels. As discussed in
Note 20, the Bank has not yet met the higher capital requirements
and is therefore not in compliance with the consent order. As a
result of the uncertain potential impact of future regulatory
actions, circumstances exist that raise substantial doubt about
the Corporation's ability to continue as a going concern."
FOREST LABORATORIES: Upsized Unsec. Notes No Impact on S&P's CCR
----------------------------------------------------------------
Standard & Poor's Ratings Services said that all of its ratings,
including its 'BB+' corporate credit rating, on New York-based
Forest Laboratories Inc. are unchanged following an upsize of its
senior unsecured notes to $1.2 billion from the proposed
$1 billion.
The ratings reflect S&P's assessment of business risk as "weak",
underpinned by product and therapeutic concentration and pressure
from managed care payors. S&P's belief that financial risk is
"intermediate" reflects its expectation that acquisition activity
will result in leverage and a ratio of funds from operations to
total debt of more than 2x and about 26%, respectively.
RATINGS LIST
Forest Laboratories Inc.
Corporate Credit Rating BB+/Stable/--
$1.2B senior unsecured notes BB+
Recovery rating 3
FRESNO, CA: S&P Lowers Debt Ratings to 'BB+' on Weak Finances
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its issuer credit
rating (ICR) to 'BBB-' from 'BBB' on Fresno, Calif. and its long-
term rating and underlying rating (SPUR) to 'BB+' from 'BBB-' on
the city's lease revenue bonds, pension obligation bonds, and
judgment obligation bonds. The outlook is stable.
"The downgrade is based on the new local GO criteria and reflects
our view of the city's very weak budgetary flexibility and the
fiscal 2012 comprehensive financial report auditor's letter, which
notes that the city's fiscal condition raises doubts about its
ability to continue as a going concern," said Standard & Poor's
credit analyst Misty Newland.
S&P do not anticipate changing the ratings within the two-year
outlook horizon given the likelihood that the city's budgetary
flexibility will remain limited. Should the city's flexibility
and performance improve, S&P could raise the ratings. However,
should liquidity weaken, or performance deteriorate further, there
would likely be downward rating pressure.
FURNITURE BRANDS: Officers Want Some D&O Insurance
--------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the Furniture Brands International Inc. bankruptcy
didn't halt shareholder lawsuits alleging that company officers
provided faulty financial information.
According to the report, consequently, former Chief Executive
Officer Ralph Scozzafava and former Chief Financial Officer Vance
Johnston filed papers in bankruptcy court last week seeking
permission to defend themselves by using some of the $15 million
in directors' and officers' liability insurance.
Katy Stech, writing for The Wall Street Journal, reported that an
attorney for the two officers said the insurance policy promised
to cover losses "arising from any securities claim" against the
company.
Before the company filed for bankruptcy in September, several
shareholders sued the two men, accusing them of making positive
statements that didn't reflect the problems within its wholesale
business or other liquidity issues, according to one of the
lawsuit, the WSJ report related. The misleading statements, the
lawsuit argued, caused some of the company's shareholders to
suffer "significant losses and damages."
The attorney for the two men denied the allegations and said he
plans to ask for the lawsuit to be dismissed, the WSJ report said.
The men served the company until Nov. 25, when the $280 million
sale to KPS Capital Partners LP was completed. The bankruptcy
court had approved the sale three days before.
Private-equity investor KPS is operating the business under the
umbrella of a newly formed company named Heritage Home Group LLC.
About Furniture Brands
Furniture Brands International (NYSE:FBN) --
http://www.furniturebrands.com-- engaged in the designing,
manufacturing, sourcing and retailing home furnishings. Furniture
Brands markets products through a wide range of channels,
including company owned Thomasville retail stores and through
interior designers, multi-line/ independent retailers and mass
merchant stores. Its brands include Thomasville, Broyhill, Lane,
Drexel Heritage, Henredon, Pearson, Hickory Chair, Lane Venture,
Maitland-Smith and LaBarge.
The balance sheet at June 29, 2013, showed $546.73 million in
total assets against $550.13 million in total liabilities.
On Sept. 9, 2013, Furniture Brands International, Inc. and 18
affiliated companies sought Chapter 11 protection (Bankr. D. Del.
Lead Case No. 13-12329).
Attorneys at Paul Hastings LLP and Young Conaway Stargatt &
Taylor, LLP, serve as counsel to the Debtors. Alvarez and Marsal
North America, LLC, is the restructuring advisors. Miller
Buckfire & Co., LLC is the investment Banker. Epiq Systems Inc.
dba Epiq Bankruptcy Solutions is the claims and notice agent.
The official creditor's committee is comprised of the Pension
Benefit Guaranty Corp., Milberg Factors Inc. and five suppliers.
The Committee tapped Blank Rome LLP as co-counsel, Hahn &
Hessen LLP as lead counsel, BDO Consulting as financial advisor,
and Houlihan Lokey Capital, Inc., as investment banker.
In November 2013, Furniture Brands won bankruptcy court approval
to sell the business to KPS Capital Partners LP for $280 million.
Private-equity investor KPS formed a new company named Heritage
Home Group LLC to operate the business.
GELT PROPERTIES: Court Okays Changes to Beneficial Mutual Accord
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Pennsylvania
authorized Gelt Financial Corporation, et al., and Beneficial
Mutual Savings Bank to modify the settlement agreement between
parties.
The Court approved the settlement agreement on Oct. 29, 2013.
However, upon review of the parties, the title of the order
contains errors.
Beneficial extended a $3 million line of credit loan to the Debtor
in 2006. The Debtor defaulted on the loan.
Pursuant to the settlement agreement dated Oct. 17, 2013, the
parties agree that the Debtor owes Beneficial $3.69 million plus
continuing interests, costs and fees. The parties agree that the
Debtor will pay $425,000 immediately upon court approval of the
settlement, but in no event later than Oct. 31, 2013, and an
additional $575,000 by Dec. 31, 2013. The Debtor will also grant
a full release of all claims against Beneficial. In exchange,
Beneficial will satisfy its secured claim against the Debtor and
property of the Debtor and release the sureties. Beneficial,
however, will retain a $500,000 allowed unsecured claim in the
Debtors.
A copy of the terms of the settlement is available for free at
http://bankrupt.com/misc/GeltProperties_Settlement.pdf
About Gelt Properties, LLC
Based in Huntington Valley, Pennsylvania, Gelt Properties, LLC,
and affiliate Gelt Financial Corporation borrow money from
traditional lenders and make loans to commercial borrowers. They
also acquire and manage real estate. Gelt Properties and Gelt
Financial filed for (Bankr. E.D. Pa. Case Nos. 11-15826 and
11-15826) on July 25, 2011. Judge Magdeline D. Coleman presides
over the cases.
William John Baldini, Esq., Albert A. Ciardi, III, Esq., Jennifer
E. Cranston, Esq., Daniel S. Siedman, Esq., and Jennifer C.
McEntee at Ciardi Ciardi & Astin, in Philadelphia, Pa.; Thomas
Daniel Bielli, Esq., at O'Kelly Ernst & Bielli, LLC, in
Philadelphia, Pa.; Janet L. Gold, Esq., at Eisenberg, Gold &
Cettei, P.C., in Cherry Hill, N.J.; David A. Huber, Esq., at
Benjamin Legal Services, in Philadelphia, Pa.; Alan L. Nochumson,
Esq., at Nochumson PC, in Philadelphia, Pa.; Axel A. Shield, II,
Esq., of Huntington Valley, Pa., serve as counsel for Debtor Gelt
Properties, LLC.
Ciardi Ciardi & Astin also represents Debtor Gelt Financial
Corporation as counsel.
Gelt Properties disclosed $4.73 million in assets and
$4.84 million in liabilities as of the Chapter 11 filing. Its
affiliate, Gelt Financial has scheduled $20.3 million in assets
and $17.05 million in liabilities as of the Chapter 11 filing.
Paul J. Schoff, Esq., and Francis X. Gorman, Esq., at Schoff
McCabe, P.C., represent the Unsecured Creditors' Committee.
Craig Howe, CPA, and Howe, Keller & Hunter, P.C., serve as the
Committee's accountants.
GENERAL MOTORS: U.S. Government Sells Remaining Stake
-----------------------------------------------------
Jeff Bennett and Eric Morath, writing for The Wall Street Journal,
reported that the U.S. government sold its last shares in General
Motors Co. on Dec. 9, booking a $10.5 billion loss but clearing
the way for the auto maker to return cash to shareholders and
begin wooing consumers alienated by the bailout.
According to the report, the Treasury Department's final sale of
GM shares came as the auto maker's stock hit $40.90, a new high,
in 4:00 p.m. trading on Dec. 9 and gained 30 cents in late trading
following the announcement.
Taxpayers recouped $39 billion of the $49.5 billion spent rescuing
the Detroit auto maker, the report related. That loss is sure to
fuel the debate over whether taxpayer money should have been used
to put GM and Chrysler Group LLC through government-led
bankruptcies in 2009.
Bailout opponents say the government had no right to orchestrate
bankruptcies that resulted in losses for bondholders while
protecting pensions for union workers and retirees, the report
said. Proponents say the auto industry and the nation's Midwest
manufacturing heartland would have been devastated by a collapse
of auto and auto-parts makers.
President Barack Obama, in a statement, called the rescue a
success, pointing to the 372,000 new jobs created in the U.S. auto
business over the past five years and the strong profits at the
Detroit Three auto makers, the report further related.
About General Motors
With its global headquarters in Detroit, Michigan, General Motors
Company (NYSE:GM, TSX: GMM) -- http://www.gm.com/-- is one of
the world's largest automakers, traces its roots back to 1908.
GM employs 208,000 people in every major region of the world and
does business in more than 120 countries. GM and its strategic
partners produce cars and trucks in 30 countries, and sell and
service these vehicles through the following brands: Baojun,
Buick, Cadillac, Chevrolet, GMC, Daewoo, Holden, Isuzu, Jiefang,
Opel, Vauxhall, and Wuling. GM's largest national market is
China, followed by the United States, Brazil, the United Kingdom,
Germany, Canada, and Italy. GM's OnStar subsidiary is the
industry leader in vehicle safety, security and information
services.
General Motors Co. was formed to acquire the operations of
General Motors Corp. through a sale under 11 U.S.C. Sec. 363
following Old GM's bankruptcy filing. The U.S. government once
owned as much as 60.8% stake in New GM on account of the
financing it provided to the bankrupt entity. The deal was
closed July 10, 2009, and Old GM changed its name to Motors
Liquidation Co.
General Motors Corp. and three of its affiliates filed for
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on
June 1, 2009. The Honorable Robert E. Gerber presides over the
Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin,
Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges
LLP, assist the Debtors in their restructuring efforts. Al Koch
at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as
the Chief Executive Officer for Motors Liquidation Company. GM
is also represented by Jenner & Block LLP and Honigman Miller
Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP
is providing legal advice to the GM Board of Directors. GM's
financial advisors are Morgan Stanley, Evercore Partners and the
Blackstone Group LLP. Garden City Group is the claims and notice
agent of the Debtors.
The U.S. Trustee appointed an Official Committee of Unsecured
Creditors and a separate Official Committee of Unsecured
Creditors Holding Asbestos-Related Claims. Lawyers at Kramer
Levin Naftalis & Frankel LLP served as bankruptcy counsel to the
Creditors Committee. Attorneys at Butzel Long served as counsel
on supplier contract matters. FTI Consulting Inc. served as
financial advisors to the Creditors Committee. Elihu Inselbuch,
Esq., at Caplin & Drysdale, Chartered, represented the Asbestos
Committee. Legal Analysis Systems, Inc., served as asbestos
valuation analyst.
The Bankruptcy Court entered an order confirming the Debtors'
Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan
was declared effect on March 31, 2011.
GENERAL MOTORS: To Shift Production in Asia
-------------------------------------------
Jeff Bennett, writing for The Wall Street Journal, reported that
General Motors Co. is preparing a concerted attack on its most
troubled international operations that would entail big output
cuts at factories in South Korea and likely an end to production
in Australia, said people familiar with the auto maker's plans.
According to the report, GM intends to close its two Australian
plants and separately slash production in South Korea by as much
as 20% by 2016, these people said. The moves come on top of a
planned factory closing in Germany and last week's decision to end
Chevrolet sales in Europe in two years. A portion of the South
Korean factory output would be used to feed the Australian market,
the people said.
The largest U.S. auto maker has determined that economic changes
-- including high wages and labor unrest in South Korea, and a
strong currency in Australia and shift to imports there -- have
undercut its manufacturing competitiveness in the two countries,
the report said.
Its executives are determined to attack unprofitable operations
outside its North American home market that have dented profits
during the past year, the report related. Its third-quarter pre-
tax earnings in its international operations, including most of
Asia, fell 61% to $299 million due in part to problems in
Australia. Without the unit's earnings from China, the region
would have lost more than $100 million.
GM Chief Executive Dan Akerson took a big step toward fixing its
biggest international trouble spot by deciding largely to phase
out Chevrolet sales in Europe and focus on its German Opel and
British Vauxhall brands, the report further related.
About General Motors
With its global headquarters in Detroit, Michigan, General Motors
Company (NYSE:GM, TSX: GMM) -- http://www.gm.com/-- is one of
the world's largest automakers, traces its roots back to 1908.
GM employs 208,000 people in every major region of the world and
does business in more than 120 countries. GM and its strategic
partners produce cars and trucks in 30 countries, and sell and
service these vehicles through the following brands: Baojun,
Buick, Cadillac, Chevrolet, GMC, Daewoo, Holden, Isuzu, Jiefang,
Opel, Vauxhall, and Wuling. GM's largest national market is
China, followed by the United States, Brazil, the United Kingdom,
Germany, Canada, and Italy. GM's OnStar subsidiary is the
industry leader in vehicle safety, security and information
services.
General Motors Co. was formed to acquire the operations of
General Motors Corp. through a sale under 11 U.S.C. Sec. 363
following Old GM's bankruptcy filing. The U.S. government once
owned as much as 60.8% stake in New GM on account of the
financing it provided to the bankrupt entity. The deal was
closed July 10, 2009, and Old GM changed its name to Motors
Liquidation Co.
General Motors Corp. and three of its affiliates filed for
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on
June 1, 2009. The Honorable Robert E. Gerber presides over the
Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin,
Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges
LLP, assist the Debtors in their restructuring efforts. Al Koch
at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as
the Chief Executive Officer for Motors Liquidation Company. GM
is also represented by Jenner & Block LLP and Honigman Miller
Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP
is providing legal advice to the GM Board of Directors. GM's
financial advisors are Morgan Stanley, Evercore Partners and the
Blackstone Group LLP. Garden City Group is the claims and notice
agent of the Debtors.
The U.S. Trustee appointed an Official Committee of Unsecured
Creditors and a separate Official Committee of Unsecured
Creditors Holding Asbestos-Related Claims. Lawyers at Kramer
Levin Naftalis & Frankel LLP served as bankruptcy counsel to the
Creditors Committee. Attorneys at Butzel Long served as counsel
on supplier contract matters. FTI Consulting Inc. served as
financial advisors to the Creditors Committee. Elihu Inselbuch,
Esq., at Caplin & Drysdale, Chartered, represented the Asbestos
Committee. Legal Analysis Systems, Inc., served as asbestos
valuation analyst.
The Bankruptcy Court entered an order confirming the Debtors'
Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan
was declared effect on March 31, 2011.
GENIUS BRANDS: Four Directors Quit, Seven Directors Appointed
-------------------------------------------------------------
Michael Meader, Larry Balaban, Howard Balaban and Saul Hyatt
resigned as directors of Genius Brands International, Inc.,
effective Dec. 9, 2013. Andrew Heyward, the Company's chief
executive officer, Amy Moynihan Heyward, the Company's president,
Lynne Segall, Jeffrey Weiss, Joseph "Gray" Davis, William
McDonough and Bernard Cahill will be appointed as directors of the
Company. Mr. Heyward was also appointed as Chairman of the
Company's Board of Directors, effective Dec. 9, 2013.
Lynne Segall, 61, has served as the senior vice president and
publisher of The Hollywood Reporter since June 2011. From 2010 to
2011, Ms. Segall was the senior vice president of Deadline
Hollywood. From June 2006 to May 2010, Ms. Segall served as the
vice president of Entertainment, Fashion & Luxury advertising at
the Los Angeles Times. In 2005, Ms. Segall received the Women of
Achievement Award from The Hollywood Chamber of Commerce and the
Women in Excellence Award from the Century City Chamber of
Commerce. In 2006, Ms. Segall was recognized by the National
Association of Women with its Excellence in Media Award. Ms.
Segall was chosen to be a director based on her expertise in the
entertainment industry.
Jeffrey Weiss, 50, is the co-chief executive officer of American
Greetings Corporations and has been an employee of such company
since 1988. Mr. Weiss is also a member of American Greetings
Corporation's Board of Directors. Mr. Weiss received his Bachelor
of Arts Degree in Finance from Yeshiva University and his Master's
degree from the University of Pennsylvania's Wharton School of
Business. Mr. Weiss was chosen to be a director of the Company
based on his experience in retail, product development,
merchandizing, marketing and entertainment development.
Joseph "Gray" Davis, 70, served as the 37th governor of California
from 1998 until 2003. Mr. Davis currently serves as "Of Counsel"
in the Los Angeles, California, office of Loeb & Loeb LLP. Mr.
Davis has served on the Board of Directors of DiC Entertainment
and is a member of the bi-partisan Think Long Committee, a Senior
Fellow at the UCLA School of Public Affairs and Co-Chair of the
Southern California Leadership Counsel. Mr. Davis received his
undergraduate degree from Stanford University and received his
Juris Doctorate from Columbia Law School. Mr. Davis served as
lieutenant governor of California from 1995-1998, California State
Controller from 1987-1995 and California State Assemblyman from
1982-1986. Mr. Davis was chosen as a director of the Company
based on his knowledge of corporate governance.
William McDonough, 33, is a founding partner of Atlas Merchant
Capital, which he co-founded in July 2013. From 2009 to 2013, Mr.
McDonough was employed by Goldman Sachs, where his team managed
the private capital of the current and retired partnership. Prior
to that, Mr. McDonough launched a distressed debt and credit hedge
fund of funds at Avenue Capital Group from 2007 to 2009. Mr.
McDonough received his degree in Marketing and Pre-Law from Boston
College. Mr. McDonough was chosen to be a director of the Company
based on his broad knowledge of corporate finance.
Bernard Cahill, 48, is the founding partner of ROAR, LLC, an
entertainment consulting firm, which he founded in 2004 and is the
founding partner of Cahill Law Offices, an entertainment law firm,
which he founded in 1995. Mr. Cahill is the founder of Unicorn
Games LLC, which was sold to Hasbro, Inc., in 2000. Mr. Cahill
holds a Bachelor's of Science degree in Biology from Illinois
State University and a Juris Doctorate from the John Marshall Law
School. Mr. Cahill is a member of the Tennessee State and
Illinois State Bar. Mr. Cahill was chosen to be a director based
on his expertise in the entertainment field.
On Nov. 15, 2013, in connection with Company's merger, the Company
entered into an engagement letter with ROAR pursuant to which ROAR
agreed to provide the Company with certain services, including the
development of a business development strategy, for a period of 18
months. In consideration for its services, the Company agreed to
pay ROAR 6,749,175 shares of common stock, which will vest as
follows: 2,000,000 shares upon execution of the engagement letter,
2,000,000 shares on Jan. 15, 2014, 1,374,588 shares on Sept. 15,
2014, and 1,374,587 shares on March 15, 2015. Additionally, on
Nov. 15, 2013, the Company entered into a marketing consultation
agreement with Girlilla Marketing LLC pursuant to which Girlilla
agreed to provide certain strategic digital marketing services in
consideration for 1,000,000 shares of common stock, which shall
vest as follows: 200,000 shares upon execution of the Girlilla
Consulting Agreement, 200,000 shares on Jan. 15, 2014, 200,000
shares on March 15, 2014, 200,000 shares on June 15, 2014 and
200,000 shares on Sept. 14, 2014. ROAR owns 65% of Girlilla.
On Dec. 5, 2013, the Company made a presentation at the 2013 LD
Micro Conference in Los Angeles, California. The presentation
included a power point presentation, a copy of which is available
for free at http://is.gd/fSuXmh
About Genius Brands
San Diego, Calif.-based Genius Brands International, Inc., creates
and distributes music-based products which it believes are
entertaining, educational and beneficial to the well-being of
infants and young children under its brands, including Baby Genius
and Little Genius.
As of Sept. 30, 2013, the Company had $1.55 million in total
assets, $4.96 million in total liabilities and a $3.41 million
total stockholders' deficit.
GONZALES RDA: S&P Lowers Long-Term Rating on 2011 TABs to 'BB-'
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term rating to
'BB-' from 'BB+' on Gonzales Redevelopment Agency, Calif.'s
(Gonzales RDA) series 2011 tax allocation bonds. The outlook is
negative.
"The lower rating is due to what could be violation of priority of
payment provisions in the trust indenture and dissolution law
causing a repeated draw on debt service reserves," said Standard &
Poor's credit analyst Kate Burroughs. "Meanwhile, the negative
outlook reflects the possibility that such violations could result
in acceleration of bond payments," Ms. Burroughs added.
The City of Gonzales is acting as successor agency to the former
RDA after the state legislature and a subsequent court ruling
dissolved all RDAs in California in February 2012, pursuant to
Assembly Bill (AB)x1 26 and subsequent amending legislation AB
1484.
HEADWATERS INC: S&P Rates Proposed $150MM Sr. Unsec. Notes 'CCC+'
-----------------------------------------------------------------
Standard & Poor's Ratings Services said it assigned its 'CCC+'
issue-level rating (two notches below the corporate credit rating)
to U.S.-based light building products and heavy construction
materials company Headwaters Inc.'s proposed $150 million senior
unsecured notes. The recovery rating is '6', indicating S&P's
expectation of negligible (0% to 10%) recovery in the event of
default.
At the same time, S&P affirmed its 'B+' issue-level rating on the
company's $400 million senior secured notes. The recovery rating
remains '2', indicating S&P's expectation of substantial (70% to
90%) recovery in the event of default. In addition, S&P affirmed
its 'CCC+' issue-level rating on its 2.5% convertible senior
subordinated notes due 2014. The recovery rating remains '6'.
The 'B' corporate credit rating remains unchanged.
South Jordan, Utah-based Headwaters Inc. is seeking to issue
$150 million of senior unsecured notes, with proceeds expected to
fund future acquisitions and to be used for general corporate
purposes. The 'CCC+' issue-level rating on Headwaters' senior
unsecured notes reflects S&P's view of the company's business risk
as "weak" and its financial risk as "highly leveraged". The weak
business risk profile reflects Headwaters' exposure to cyclical
residential and nonresidential end markets, partially offset by
moderate product diversity and leading positions in the coal
combustion business. The key business risk includes S&P's
expectation of above-average EBITDA volatility due to the
company's exposure to the cyclical residential and nonresidential
construction sectors. S&P's financial risk assessment reflects
its opinion that leverage will exceed 5x EBITDA, including these
new notes.
Ratings List
Headwaters Inc.
Corporate Credit Rating B/Stable/--
New Rating
Headwaters Inc.
$150 mil sr unsecd nts CCC+
Recovery Rating 6
Ratings Affirmed
Headwaters Inc.
$400 mil sr sec nts B+
Recovery Rating 2
$160 mil 2.5% convertible sr sub nts due 2014 CCC+
Recovery Rating 6
INFUSYSTEM HOLDINGS: Files Copy of Presentation with SEC
--------------------------------------------------------
InfuSystem Holdings, Inc., furnished with the U.S. Securities and
Exchange Commission a copy of its investor presentation dated
Dec. 5, 2013. The Presentation -- which discussed about, among
other things, Company overview and 2013 nine-month financials --
is available for free at http://is.gd/O5lNLb
About InfuSystem Holdings
InfuSystem Holdings, Inc., operates through operating
subsidiaries, including InfuSystem, Inc., and First Biomedical,
Inc. InfuSystem provides infusion pumps and related services.
InfuSystem provides services to hospitals, oncology practices and
facilities and other alternate site healthcare providers.
Headquartered in Madison Heights, Michigan, InfuSystem delivers
local, field-based customer support, and also operates pump
service and repair Centers of Excellence in Michigan, Kansas,
California, and Ontario, Canada.
Infusystem Holdings disclosed a net loss of $1.48 million in 2012
as compared with a net loss of $45.44 million in 2011. The
Company's balance sheet at Sept. 30, 2013, showed $76.39 million
in total assets, $34.77 million in total liabilities and $41.62
million in total stockholders' equity.
ISOLA USA: S&P Revises Outlook to Stable & Affirms 'B-' CCR
-----------------------------------------------------------
Standard & Poor's Ratings Services said that it revised its
outlook to stable from negative and affirmed its 'B-' corporate
credit rating on Chandler, Ariz.-based Isola USA Corp.
"The outlook revision reflects our view of the extension of the
company's term loan to five years and its mezzanine debt
maturities to 5.5 years," said Standard & Poor's credit analyst
Christian Frank. "The outlook revision also reflects our view
that the company is likely to maintain at least 15% headroom under
its new senior leverage covenant schedule, which was established
as part its refinancing completed on Nov. 29, 2013," Mr. Frank
added.
The rating reflects S&P's view of Isola's highly leveraged
financial risk profile and vulnerable business risk profile.
IZEA INC: Expects to Report 100% Bookings Growth for Q4
-------------------------------------------------------
In a presentation by Edward H. (Ted) Murphy, IZEA, Inc.'s
president and chief executive officer, on Dec. 5, 2013, at the LD
Micro Conference in Los Angeles, Mr. Murphy announced that IZEA
expects to report 100 percent bookings growth for the fourth
quarter of 2013 compared to the corresponding quarter last year.
No additional comments were made with respect to IZEA's projected
financial or operational results for the fourth quarter of 2013 or
the 2014 year. The company does not anticipate regularly
providing quarterly bookings information in advance of a quarter's
end.
About IZEA, Inc.
IZEA, Inc., headquartered in Orlando, Fla., believes it is a world
leader in social media sponsorships ("SMS"), a rapidly growing
segment within social media where a company compensates a social
media publisher to share sponsored content within their social
network. The Company accomplishes this by operating multiple
marketplaces that include its platforms SocialSpark,
SponsoredTweets and WeReward, as well as its legacy platforms
PayPerPost and InPostLinks.
IZEA reported a net loss of $4.67 million in 2012 as compared with
a net loss of $3.97 million in 2011. The Company's balance sheet
at Sept. 30, 2013, showed $3.39 million in total assets,
$4.68 million in total liabilities and a $1.28 million total
stockholders' deficit.
Cross, Fernandez & Riley, LLP, in Orlando, Florida, issued a
"going concern" qualification on the consolidated financial
statements for the year ended Dec. 31, 2012. The independent
auditors noted that the Company has incurred recurring operating
losses and had a negative working capital and an accumulated
deficit at Dec. 31, 2012. These conditions raise substantial
doubt about the Company's ability to continue as a going concern
without raising sufficient additional financing.
KAHN FAMILY: Court OKs Marty P. Ouzts as Accountant
---------------------------------------------------
The Bankruptcy Court entered an order authorizing Kahn Family,
LLC, to employ Marty P. Ouzts, CPA, of Ouzts, Ouzts and Varn, PC,
its as accountant to perform consulting accounting services,
including preparation of Plan feasibility analysis and related
matters.
Kahn Family, LLC, and Kahn Properties South, LLC, filed bare-bones
Chapter 11 petitions (Bankr. D. S.C. Case Nos. 13-02354 and
13-02355) on April 22, 2013. Kahn Family disclosed $50 million to
$100 million in assets and liabilities. R. Geoffrey Levy, Esq.,
at Levy Law Firm, LLC, serves as the Debtors' counsel. David G.
Wolff, Esq., at Barnes, Alford, Stork & Johnson, LLP, is the
Debtor's special counsel. Bill Quattlebaum, CPA of Elliott Davis,
LLC, serves as its accountant.
LIBERTY HARBOR: Dec. 26 Hearing to Confirm 2nd Amended Plan
-----------------------------------------------------------
Liberty Harbor Holding, LLC, et al., submitted to the U.S.
Bankruptcy Court for the District of New Jersey a Disclosure
Statement in connection with the solicitation of votes with
respect to their Second Amended Joint Plan pf Reorganization.
On Nov. 26, 2013, the Bankruptcy Court (i) entered an order
approving the Disclosure Statement as containing adequate
information, to enable creditors to make an informed judgment
regarding whether to accept or reject the Plan, and (ii) allowed
the Debtors to solicit acceptances on their Plan.
The Court set a Dec. 26 hearing to consider confirmation of the
Plan.
According to the Disclosure Statement, the Plan will be funded by
the Debtors. To the extent required, the Moccos and entities
controlled by the Moccos will provide the Debtors with the funding
necessary to consummate the Plan, including, but not limited to,
all payments due under the Kerrigan Settlement. The Moccos have
already advanced the Debtors the sum of $3,000,000, which amounts
were necessary to deliver the initial two payments under the
Kerrigan Settlement Agreement between the Debtors, the JCRA, the
City of Jersey City and the Kerrigans.
As of the date of the Plan, the Moccos have already provided these
funding to the Debtors:
a) $2,500,000 upon execution of the Kerrigan Settlement;
b) $500,000 within 30 days of execution of the Kerrigan
Settlement;
c) $3,000,000 on or about Dec. 31, 2012; and
d) upon consummation of a sale of land to New Jersey Transit,
an additional $4,000,000 was received by the Debtors.
Further payments totaling in excess of $12,000,000 are, pursuant
to the Kerrigan Settlement, to be made by the Debtors and funded
by the Moccos in the next five years.
The Moccos will fund the Plan notwithstanding the outcome of the
Ownership Litigation. Any cash required to be paid by the
Debtors, pursuant to the Plan, may be paid by check drawn on an
account of the Disbursing Agent, or by wire transfer, or as
otherwise required or provided by applicable agreements or law.
With respect to any distributions to be made on the Effective
Date, the distribution will be deemed timely made if made on the
Effective Date or as soon thereafter as is practicable.
A copy of the Disclosure Statement is available for free at
http://bankrupt.com/misc/LIBERTYHARBORds2plan.pdf
About Liberty Harbor
Jersey City, New Jersey-based Liberty Harbor Holding, LLC, along
with two affiliates, sought Chapter 11 protection (Bankr. D.N.J.
Lead Case No. 12-19958) in Newark on April 17, 2012. Each of the
Debtors is solely owned by Peter Mocco.
Liberty, as of April 16, 2012, had total assets of $350.08
million, comprising of $350 million of land, $75,000 in accounts
receivable and $458 cash. The Debtor says that it has
$3.62 million of debt, consisting of accounts payable of $73,500
and unsecured non-priority claims of $3,540,000. The Debtor's
real property consists of Block 60, Jersey City, NJ 100% ownership
Lots 60, 70, 69.26, 61, 62, 63, 64, 65, 25H, 26A, 26B, 27B, 27D.
Affiliates that filed separate petitions are: Liberty Harbor II
Urban Renewal Co., LLC (Case No. 12-19961) and Liberty Harbor
North, Inc. (Case No. 12-19964). The three cases are
administratively consolidated.
Judge Novalyn L. Winfield presides over the case. Wasserman,
Jurista & Stolz, P.C. serves as insolvency counsel and Scarpone &
Vargo serves as special litigation counsel. The petition was
signed by Peter Mocco, managing member.
Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed three
creditors to the Official Committee of Unsecured Creditors in the
Chapter 11 cases of the Debtor.
LIFE CARE ST. JOHNS: Balks at Cook Bid for Ombudsman
----------------------------------------------------
Life Care St. Johns, Inc., doing business at Glenmoor, opposes a
motion for appointment of a patient care ombudsman.
As reported in the Nov. 20 edition of the TCR, Donna J. Cook, a
patient, sought an ombudsman, noting that the Debtor has, to date,
failed to report the numerous complaints made by Ms. Cook, her
family, and/or her representatives regarding her involuntary
displacement from the Debtor's facility by the Debtor.
In response, counsel to the Debtor, Bradley R. Markey, Esq., at
Stutsman Thames & Markey, P.A, explains that Ms. Cook and her
husband became residents of Glenmoor in March 2011, and maintained
a residence in the independent living section of Glenmoor until
February of this year. In February, Ms. Cook left Glenmoor to
seek treatment elsewhere for advanced dementia or Alzheimer's
Disease. Ms. Cook's husband continues to reside in Glenmoor.
According to the Debtor's counsel, despite Ms. Cook referring to
herself as "Patient," the fact is that she was never a patient in
the Assisted Living Center or Health Center. Ms. Cook, through
counsel, has requested that she be permitted to return to
Glenmoor. The medical staff at Glenmoor, with input from Ms.
Cook's personal physician, determined that due to her
deteriorating mental condition and her propensity to "wander," her
residency at Glenmoor would pose an undue safety risk to her as
Glenmoor does not provide a "lock down" type of residency. Thus,
as much as Glenmoor would like to accommodate Ms. Cook, its
Assisted Living Center and Health Care Facilities are not equipped
or licensed to do so.
Mr. Markey avers that Ms. Cook is correct in that her request to
move back to Glenmoor, and her displeasure with Glenmoor's
decision to decline that request, are not being reported in the
monthly ombudsman reports. That is because Ms. Cook is not a
resident, was never a patient, and has not brought any post-
petition litigation.
The Debtor previously obtained approval of its motion for self-
reporting in lieu of appointment of an ombudsman subject to
Glenmoor providing a monthly ombudsman report. In seeking
approval, the Debtor argued that to the extent its business was
deemed to be a "health care business" under Section 333,
appointment of an ombudsman was not necessary for the protection
of Glenmoor residents who obtain services as patients in its
assisted living center or health center.
About Life Care St. Johns
Life Care St. Johns, Inc., filed a Chapter 11 petition (Bankr.
M.D. Fla. Case No. 13-04158) on July 3, 2013. Judge Jerry A. Funk
presides over the case.
The Debtor is the owner and operator of a continuing care
retirement community known as Glenmoor consisting of 144
independent living units located on a 40-acre site in St. Johns
County, Florida.
Richard R. Thames, Esq., and Eric N. McKay, Esq., at Stutsman
Thames & Markey, P.A., serves as the Debtor's counsel. Navigant
Capital Advisors, LLC, acts as the Debtor's financial advisor.
Eddie Williams, III, Esq., and Beth A. Vecchioli, Esq., at Holland
& Knight, LLC, serves as regulatory compliance counsel. Hamlyn
Senior Marketing, LLC, is the marketing consultant. American
Legal Claim Services, LLC, serves as claims and noticing agent.
The official committee of creditors holding unsecured claims is
represented by Akerman Senterfitt's David E. Otero, Esq., and
Christian P. George, Esq., in Jacksonville, Florida.
The Debtor estimated assets of at least $10 million and debts of
at least $50 million.
LIME ENERGY: Stockholders Elect Five Directors
----------------------------------------------
The annual meeting of stockholders of Lime Energy Co. was held on
Dec. 3, 2013. At the annual meeting, the stockholders of the
Company's Common Stock and Series A Preferred Stock:
(1) elected Gregory T. Barnum, Christopher W. Capps, Stephen
Glick, Richard P. Kiphart and John O'Rourke as directors
for a one-year term ending at the Company's 2014 annual
meeting of stockholders or until their respective
successors are duly elected and qualified;
(2) approved the issuance of common stock upon the conversion
of the Company's preferred stock and the exercise of its
outstanding warrants issued in connection with the sale of
the Company's Series A Preferred Stock;
(3) approved an amendment to the Company's 2010 Non-Employee
Directors Stock Plan to increase the maximum number of
shares of common stock currently available for awards under
the Plan from 35,715 shares to 71,430 shares;
(4) approved the 2013 Employee Stock Purchase Plan;
(5) approved an advisory vote on named executive officer
compensation;
(6) selected "every three years" as the desired frequency of
future advisory vote on executive compensation; and
(7) ratified the appointment of BDO USA, LLP, as the Company's
independent registered public accounting firm for the
fiscal year 2013.
About Lime Energy
Headquartered in Huntersville, North Carolina, Lime Energy Co. --
http://www.lime-energy.com-- is engaged in planning and
delivering clean energy solutions that assist its clients in their
energy efficiency and renewable energy goals. The Company's
solutions include energy efficient lighting upgrades, energy
efficient mechanical and electrical retrofit and upgrade services,
water conservation, building weatherization, on-site generation
and renewable energy project development and implementation. The
Company provides energy solutions across a range of facilities,
from high-rise office buildings, distribution facilities,
manufacturing plants, retail sites, multi-tenant residential
buildings, mixed use complexes, hospitals, colleges and
universities, government sites to small, single tenant facilities.
Lime Energy disclosed in regulatory filings in July 2013, it is in
discussions with PNC Bank about entering into a forbearance
agreement in which they would agree not to accelerate a loan for a
period of time while the Company attempts to correct the gas flow
issue and sell its landfill-gas facility. The bank is considering
the Company's request.
As of Sept. 30, 2013, the Company had $33.15 million in total
assets, $26.70 million in total liabilities and $6.45 million in
total stockholders' equity.
LINENS 'N THINGS: Hilco Sells IP Assets to Carlyle Unit
-------------------------------------------------------
In a joint announcement on Dec. 9, Gordon Brothers Group, Hilco
Global and Infinity Lifestyle Brands reported the sale of the
Linens 'N Things intellectual property assets to Galaxy Brand
Holdings for an undisclosed amount.
Galaxy Brand Holdings is a brand development company with a
diversified portfolio of consumer brands generating over $700
million in annual retail sales across every segment of
distribution. In addition to Linens 'N Things, its current
portfolio includes AND1, Avia and Nevados.
In May 2013, The Carlyle Group acquired a majority interest in
Galaxy Brand Holdings.
Linens 'N Things was a major retailer of home goods with 571
stores and $2.7 billion of annual sales before filing for
bankruptcy in 2008. In February 2009, Hilco Global, Gordon
Brothers Group and other partners disposed of the company's
assets, including store and e-commerce inventory and real estate.
The intellectual property was subsequently acquired by a joint
venture including Hilco Global, Gordon Brothers Group and Infinity
Lifestyle Brands. The Linens 'N Things brand was re-launched as
an online retailer of home goods, providing a wide array of home
merchandise at value-oriented prices directly to consumers.
"Linens 'N Things enjoys a rich history of providing consumers
with a broad assortment of high-quality, value-priced home
products. We plan to leverage this heritage to connect with
consumers by offering Linens 'N Things branded products, and by
re-establishing the brand as a premier home destination both in-
store and online," said Abe M. Hidary, Vice President of Corporate
Development at Galaxy Brand Holdings.
"This transaction marks another successful turnaround of a valued
brand. We are excited for Galaxy to continue the growth the brand
has experienced over the past few years and build upon the brand's
strong history and resonance with consumers," stated
Jeffery Hecktman, Chairman and CEO of Hilco Global.
Kenneth S. Frieze, President of Gordon Brothers Group, added,
"We've been proud stewards of the Linens 'N Things brand for the
past four years and believe that this sale takes place at an
exciting time for Galaxy, who will undoubtedly have enormous
success taking it to the next level."
"The brand equity inherent in Linens and Things is testimony to
the power of our unique licensing platform," stated Ike S. Franco,
Chairman of Infinity Group LLC.
The transaction follows on the heels of other successful brand
turnarounds such as The Bombay Company, Polaroid and The Sharper
Image by Hilco Brands, a division of Hilco Global and Gordon
Brothers Group's Brand Division.
* * *
Mike Spector, writing for The Wall Street Journal, noted that the
deal returns the name to private-equity circles after a stint
under the watch of niche investment firms that buy defunct brands.
Linens 'N Things fell into bankruptcy in 2008 after Apollo Global
Management LLC, another big private-equity firm that competes with
Carlyle and others, led a buyout that saddled the retailer with
debt it couldn't handle in the recession.
The Carlyle-owned Galaxy Brand Holdings will pay more than
$10 million for the Linens 'N Things brand, one of the people
said, the WSJ report related.
A team of Hilco Global, Gordon Brothers Group LLC and Infinity
Lifestyle Brands bought the brand out of bankruptcy proceedings in
February 2009 for roughly $1 million after the retailer went out
of business, the report said. They revived the name as an
e-commerce website, and later struck a deal to sell a range of
bed, bath and decor products under the brand at Home Outfitters
stores in Canada. That deal is no longer in place, said a person
familiar with the matter.
About Linens 'n Things
Headquartered in Clifton, New Jersey, Linens 'n Things, Inc. --
http://www.lnt.com/-- was the second largest specialty retailer
of home textiles, housewares and home accessories in North
America. As of Sept. 30, 2008, Linens 'n Things operated 411
stores in 47 states and seven provinces across the United States
and Canada. Linens 'n Things was acquired by private
equity firm Apollo Management in 2006.
On May 2, 2008, these Linens entities filed Chapter 11 petition
(Bankr. D. Del.): Linens Holding Co. (08-10832), Linens 'n Things,
Inc. (08-10833), Linens 'n Things Center, Inc. (08-10834),
Bloomington, MN., L.T., Inc. (08-10835), Vendor Finance, LLC (08-
10836), LNT, Inc. (08-10837), LNT Services, Inc. (08-10838), LNT
Leasing II, LLC (08-10839), LNT West, Inc. (08-10840), LNT
Virginia LLC (08-10841), LNT Merchandising company LLC (08-10842),
LNT Leasing III, LLC (08-10843), and Citadel LNT, LLC (08-10844).
Judge Christopher S. Sontchi presides over the case.
Mark D. Collins, Esq., John H. Knight, Esq., and Jason M. Madron,
Esq., at Richards, Layton & Finger, P.A., are Linens 'n Things'
bankruptcy counsel. The Debtors' special corporate counsel are
Holland N. O'Neil, Esq., Ronald M. Gaswirth, Esq., Stephen A.
McCaretin, Esq., Randall G. Ray, Esq., and Michael S. Haynes,
Esq., at Morgan, Lewis & Bockius, LLP. The Debtors'
restructuring management services provider is Conway Del Genio
Gries & Co., LLC. The Debtors' CRO and Interim CEO is Michael F.
Gries, co-founder of Conways Del Genio Gries & Co., LLC. The
Debtors' claims agent is Kurtzman Carson Consultants, LLC. The
Debtors' consultants are Asset Disposition Advisors, LLC, and
Protivit, Inc. The Debtors' investment bankers are Financo, Inc.,
and Genuity Capital Markets.
LLS AMERICA: Judge Allows Withdrawal of Foster Pepper as Counsel
----------------------------------------------------------------
In three separate orders, Chief District Judge Rosanna Malouf
Peterson adopted the report and recommendations of the Washington
Bankruptcy Court allowing the withdrawal of Dillon E. Jackson,
Esq., and the law firm Foster Pepper, PPLC, as counsel to certain
defendants in lawsuits commenced by the bankruptcy trustee of LLS
America, LLC.
The defendants whom Foster Pepper represented are:
* Defendants Jan Power and Lisa Sarah Ormand in the adversary
complaint BRUCE P. KRIEGMAN, solely in his capacity as court-
appointed Chapter 11 Trustee for LLS America, LLC, Plaintiff,
v. AMY BELLING, et al., Defendants, Adv. Proc. No. 11-80296
* Defendant Masterline Design in the adversary complaint BRUCE
P. KRIEGMAN, solely in his capacity as court-appointed Chapter
11 Trustee for LLS America, LLC, Plaintiff, v. 558778, BC,
LTD, et al., Defendants, Case No. 11-80295
A copy of one of the District Court's Oct. 21, 2013 Orders is
available at http://is.gd/jJoCtsfrom Leagle.com.
About Little Loan Shoppe
LLS America LLC, doing business as Little Loan Shoppe, operated an
online payday loan business. Affiliate Team Spirit America
provided the manpower, management and equipment for Little Loan
Shoppe. The companies are among a multitude of Canadian and
American business entities owned and operated by Doris E. Nelson,
a/k/a Dee Nelson, a/k/a Dee Foster. Investors claimed Ms. Nelson
operated a Ponzi scheme. Ms. Nelson allegedly told investors they
could earn as much as 60% on money her companies used to make
payday loans to consumers. American and Canadian investors bought
notes worth US$29 million and another C$26,000,000. However, the
investors received no payments after March 2009.
One investor group placed a related company, LLS-A LLC, into
bankruptcy in July 10, 2009.
LLS America LLC filed for bankruptcy (Bankr. D. Nev. Case No.
09-23021) on July 21, 2009, before Judge Linda B. Riegle. Gregory
E. Garman, Esq., at Gordon Silver, served as the Debtor's counsel.
In its petition, the Debtor disclosed $2,661,584 in assets and
$24,013,837 in debts. The petition was signed by Ralph Gamble,
CEO of the Company.
The case was subsequently moved to Washington state (Bankr. E.D.
Wash. Case No. 09-06194). Charles Hall was appointed as examiner
in the case.
LLS AMERICA: Bankr. Court Recommends Summary Judgment vs. Briscoe
-----------------------------------------------------------------
Bankruptcy Judge Patricia Williams issued a Report and
Recommendation granting the Plaintiff's Motion for Summary
Judgment in the complaint BRUCE P. KRIEGMAN, solely in his
capacity as court-appointed Chapter 11 Trustee for LLS America
LLC, Plaintiff(s), v. STEPHEN BRISCOE, Defendant(s), Adv. Proc.
No. 11-80112 (Bankr. E.D. Wash.).
The summary judgment motion was filed by the Plaintiff in Jul
2013, seeking a judgment against the Defendant in the amount of
C$409,458. The recovery sought is based on the premise that the
consolidated debtor LLS America, LLC was engaged in a Ponzi
scheme, transferred assets to the Defendant as part of that
scheme, and was insolvent at the time of the transfers.
In her Oct. 22, 2013 Report and Recommendation available at
http://is.gd/qMK9VHfrom Leagle.com, Judge Williams found that the
Defendant has not provided any evidence contravening or otherwise
casting doubt upon the Plaintiff's supporting statement of facts
whereas the Plaintiff has produced evidence of the transfers
totaling C$409,458.
About Little Loan Shoppe
LLS America LLC, doing business as Little Loan Shoppe, operated an
online payday loan business. Affiliate Team Spirit America
provided the manpower, management and equipment for Little Loan
Shoppe. The companies are among a multitude of Canadian and
American business entities owned and operated by Doris E. Nelson,
a/k/a Dee Nelson, a/k/a Dee Foster. Investors claimed Ms. Nelson
operated a Ponzi scheme. Ms. Nelson allegedly told investors they
could earn as much as 60% on money her companies used to make
payday loans to consumers. American and Canadian investors bought
notes worth US$29 million and another C$26,000,000. However, the
investors received no payments after March 2009.
One investor group placed a related company, LLS-A LLC, into
bankruptcy in July 10, 2009.
LLS America LLC filed for bankruptcy (Bankr. D. Nev. Case No.
09-23021) on July 21, 2009, before Judge Linda B. Riegle. Gregory
E. Garman, Esq., at Gordon Silver, served as the Debtor's counsel.
In its petition, the Debtor disclosed $2,661,584 in assets and
$24,013,837 in debts. The petition was signed by Ralph Gamble,
CEO of the Company.
The case was subsequently moved to Washington state (Bankr. E.D.
Wash. Case No. 09-06194). Charles Hall was appointed as examiner
in the case.
LOS ANGELES HOUSING: S&P Cuts 2009A Revenue Bonds Rating to 'BB+'
-----------------------------------------------------------------
Standard & Poor's Ratings Services has reinstated its long-term
rating on Los Angeles Housing Authority's (HACLA) series 2009A
mortgage revenue bonds, issued for the Bella Vista Apartments
acquisition project. At the same time, Standard & Poor's has
lowered the rating by five notches to 'BB+' from 'A'. The outlook
is stable.
"We previously withdrew the rating on June 28, 2013, due to a lack
of receipt of timely, satisfactory information relating to the
project's 2012 audited financials," said Standard & Poor's credit
analyst Ki Beom Park. "We have since received the information,
allowing us to reinstate the rating."
The rating reflects Standard & Poor's view of these weaknesses:
-- The decline in debt service coverage (DSC) to 1.0x maximum
annual debt service (MADS),
-- The steep increase in payroll and utility expenses leading
to deterioration in the project's expense ratio, and
-- The project's use of an insurance provider that Standard &
Poor's does not rate.
The aforementioned weaknesses are offset by Standard & Poor's view
of these strengths:
-- The recent improvement in overall occupancy and year-to-date
financial performance, and
-- The debt service reserve fund sized at 12 months' MADS.
"The stable outlook reflects our view of the project's stable
operating performance, upheld by DSC levels that are commensurate
with the current rating and occupancy rates," Mr. Park added. "If
the project experiences higher annual expenses or any fall in DSC,
we could lower the rating. Conversely, if overall occupancy
improves, and fiscal 2013 financials reflect stronger operating
performance, we will raise the rating."
HACLA consists of 471 affordable housing units at four properties
that are geographically dispersed throughout the city.
MAUI LAND: Resolves Kapalua Purchase Agreement Disputes
-------------------------------------------------------
Maui Land & Pineapple Company, Inc., has a 51 percent ownership
interest in Kapalua Bay Holdings, LLC ("Bay Holdings"), which is
the sole member of Kapalua Bay LLC ("Kapalua Bay"). Kapalua Bay
constructed a residential and timeshare development on land that
it owned at the site of the former Kapalua Bay Hotel, and a spa on
an adjacent parcel of land that was owned by the Company and
leased to Kapalua Bay.
The Company had an agreement to purchase from Kapalua Bay certain
amenities of the project, including the spa, a beach club and a
sundry store, at the actual construction cost of approximately $35
million.
Kapalua Bay had a construction loan agreement that matured on
Aug. 1, 2011. The loan was collateralized by the project's assets
including the land underlying the project and the Amenities
Purchase and Sale Agreement. The Company and the other members of
Bay Holdings had guaranteed to the lenders completion of the
project and recourse with regard to certain acts, but did not
guarantee repayment of the loan. On June 13, 2013, the lenders
foreclosed on the project including the unsold units, leasehold
spa improvements, and the Amenities Purchase and Sale Agreement.
Because the Company did not have sufficient liquidity to purchase
the amenities at the actual construction cost of approximately $35
million, it had been actively negotiating with the lenders and new
owners of the project to resolve its commitments under the
Amenities Purchase and Sale Agreement. At Sept. 30, 2013, the
Company had recorded a $4.1 million liability in its financial
statements representing its remaining expected exposure to the
Amenities Purchase and Sale Agreement and other contingencies and
legal matters associated with the project.
Effective Nov. 25, 2013, the Amenities Purchase and Sale Agreement
was terminated and the Company and other parties associated with
the project, including the lenders, the new owners of the project,
the other members of Bay Holdings, and the property's former
management company, comprehensively resolved and settled the
numerous issues and disputes surrounding the project.
With respect to its portion of the Settlement, the Company paid
$2.4 million toward deferred maintenance at the project, conveyed
the three-acre leased parcel underlying the spa, conveyed a five-
acre parking lot adjacent to the project, and provided other
consideration in exchange for termination of the Amenities
Purchase and Sale Agreement. In addition, the Company received
full release from its construction loan guarantees and secured a
right of first offer on the spa and beach club as well as
continued access to the spa and beach club for its Kapalua Club
members.
About Maui Land & Pineapple Co.
Maui Land & Pineapple Company, Inc. (NYSE: MLP) --
http://mauiland.com/-- develops, sells, and manages residential,
resort, commercial, and industrial real estate. The Company owns
approximately 23,000 acres of land on Maui and operates retail,
utility operations, and a nature preserve at the Kapalua Resort.
The Company's principal subsidiary is Kapalua Land Company, Ltd.,
the operator and developer of Kapalua Resort, a master-planned
community in West Maui.
Maui Land incurred a net loss of $4.60 million in 2012, as
compared with net income of $5.07 million in 2011. The Company's
balance sheet at Sept. 30, 2013, showed $56.66 million in total
assets, $92.62 million in total liabilities and a $35.95 million
total stockholders' deficiency.
Deloitte & Touche LLP, in Honolulu, Hawaii, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2012, citing recurring negative cash
flows from operations and deficiency in stockholders' equity which
raise substantial doubt about the Company's ability to continue as
a going concern.
MAX MEDIA 1: Auction of Assets Set for Jan. 7
---------------------------------------------
Assets of Max Media 1 Inc. will be sold to the highest bidder at a
public auction slated for Jan. 7, 2014, at 10:00 a.m. The
trustee's sale will be held at the offices of Dioguardi Flynn LLP
at 7001 North Scottsdale Road, Suite 2060, in Scottsdale, Arizona.
The property is located at 77070 E. Lone Mountain Road, Cave
Creek, Maricopa, Arizona, and serves as collateral to $1.2 million
in debt owed to Skorish Family Limited Partnership, in Carefree,
Arizona. Max Media 1, Inc., is headquartered at 3714 East Satnam
Way, Cave Creek, Arizona.
If the trustee is unable to convey title for any reason, the
successful bidder's sole and exclusive remedy will be the return
of amounts paid to the trustee, and the successful bidder will
have no further recourse.
Dioguardi Flynn's Mark Dioguardi serves as successor trustee for
the assets, and may be reached at:
Mark Dioguardi
DIOGUARDI FLYNN LLP
7001 North Scottsdale Road, Suite 2060
Scottsdale, AZ 85253
Tel: 480-951-8800
Fax: 480-951-8824
E-mail: mdioguardi@dioguardiflynn.com
MF GLOBAL: Sapere Loses Appeal in U.S. Circuit Court
----------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that a commodities customer named Sapere Wealth Management
LLC, a thorn in the side of MF Global Holdings Ltd. throughout the
defunct broker's Chapter 11 bankruptcy, lost an appeal in the U.S.
Court of Appeals in Manhattan.
According to the report, in three pages, the appeals court
summarily dismissed the appeal, saying there was no jurisdiction
because Sapere had no right to appeal from a ruling in bankruptcy
court in early 2012.
Although MF Global was in Chapter 11, Matthews, North Carolina-
based Sapere wanted the bankruptcy court to make Chapter 7 laws
governing commodity brokers nonetheless applicable. In February
2012, U.S. Bankruptcy Judge Martin Glenn wrote an opinion saying
he didn't have power to override a statute which makes the
provisions apply only in Chapter 7, not in Chapter 11, where MF
Global had been taken over by a trustee.
Sapere appealed, only to encounter dismissal when the district
judge said there was no right of appeal because Judge Glenn's
ruling was not a "final order." The ruling in bankruptcy court
wasn't final because Judge Glenn said Sapere could raise the
argument about following Chapter 7 when the time came for MF
Global to file a Chapter 11 plan.
Sapere appealed to the Court of Appeals, which issued its ruling
on Dec. 6, dismissing the appeal because there was no right to
appeal.
When the time came for approval of the MF Global parent's Chapter
11 plan, Sapere was one of the few objectors. At confirmation,
Judge Glenn rejected Sapere's argument that distributions should
be made following Chapter 7, not Chapter 11.
MF Global is in district court now seeking dismissal of Sapere's
appeal from the confirmation order approving the plan. Sapere
continues to litigate other issues in bankruptcy court.
The appeal is Sapere Wealth Management LLC v. MF Global Holdings
Ltd., 12-4254, U.S. Court of Appeals for the Second Circuit
(Manhattan).
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. Bloomberg News reported that the
court-approved disclosure statement initially told
creditors with $1.134 billion in unsecured claims against the
parent holding company why they could expect a recovery of 13.4%
to 39.1% from the plan. As a consequence of a settlement with
JPMorgan, supplemental materials informed unsecured creditors
their recovery was reduced to the range of 11.4% to 34.4%. Bank
lenders will have the same recovery on their $1.174 billion claim
against the holding company. As a consequence of the settlement,
the predicted recovery became 18% to 41.5% for holders of $1.19
billion in unsecured claims against the finance subsidiary,
one of the companies under the umbrella of the holding company
trustee. Previously, the predicted recovery was 14.7% to 34% on
bank lenders' claims against the finance subsidiary.
MONTE VISTA GARDENS: Auction of Assets Set for Dec. 20
------------------------------------------------------
Assets of Monte Vista Gardens LLC will be sold to the highest
bidder at a public auction slated for Dec. 20, 2013, at 11:00 a.m.
The trustee's sale will be held on the steps of the Maricopa
County Superior Courthouse, 201 West Jefferson, in Maricopa
County, in or near Phoenix, Arizona.
A $10,000 deposit in the form of cashier's check payable to the
trustee is a bidding requirement.
The property is located at 6236 North Black Canyon Highway, in
Phoenix, and serves as collateral to $3.5 million in debt owed to:
Industrial Alliance Pacific Insurance and
Financial Services, Inc.
Now known as Industrial Alliance Insurance and
Financial Services Inc.
Attn: Mortgage Department
PO Box 8118
Blaine, WA 98231-8118
The trustee for the assets is:
Fred A. Farsjo, Esq.
GABROY ROLLMAN AND BOSSA P.C.
3507 North Campbell Avenue, Suite 111
Tucson, AZ 85719
Tel: 520-320-1300
The successful bidder will have until 5:00 p.m. Arizona Time of
Dec. 23, 2013, to pay the entire price. If the successful bidder
does not complete the payment, the sales agent will have the right
to close the deal with the next highest bidder and sue the
successful bidder for the difference of the amount of the winning
bid and the second highest bid, plus attorney's fees and court
costs.
MORGANS HOTEL: Jan. 27 Hearing on Claims Dismissal vs. M. Gross
---------------------------------------------------------------
Pursuant to orders entered by the Delaware Court of Chancery on
December 3 and Dec. 6, 2013, in the litigation captioned OTK
Associates, LLC v. Friedman, et al., Civil Action No. 8447-VCL,
Morgans Hotel Group Co. has issued a Notice of Hearing on
Unopposed Motion to Dismiss Claims against Michael J. Gross.
The hearing will be held in the New Castle County Courthouse,
Court of Chancery, 500 North King Street, Wilmington, Delaware
19801, on Jan. 27, 2014, at 10:00 a.m. to (a) consider the Motion,
(b) consider any objections thereto, and (c) rule on other matters
as the Court may deem appropriate.
Mr. Gross became chief executive officer of Morgans as of
March 20, 2011.
On April 1, 2013, plaintiff Jason Kalisman filed his Verified
Complaint, seeking to assert various derivative claims, including
derivative claims against Mr. Gross.
OTK filed its Verified Complaint in Intervention on April 5, 2013,
seeking to assert various individual and derivative claims,
including derivative claims against Mr. Gross.
The Company and Mr. Gross began negotiations regarding the terms
of Mr. Gross's separation. Each side was represented by counsel
in connection with those negotiations.
During negotiations, the parties exchanged numerous draft
agreements, and both parties made concessions in order to reach an
agreement.
As a result of those negotiations and concessions, on Aug. 30,
2013, the parties agreed upon the terms of the termination of Mr.
Gross's employment, memorialized in the Separation Agreement.
Kalisman executed the Separation Agreement on behalf of Morgans in
his capacity as interim chief executive officer.
A copy of the notice available for free at http://is.gd/n6Rh7E
About Morgans Hotel Group
Based in New York, Morgans Hotel Group Co. (Nasdaq: MHGC) --
http://www.morganshotelgroup.com/-- is widely credited as the
creator of the first "boutique" hotel and a continuing leader of
the hotel industry's boutique sector. Morgans Hotel Group
operates and owns, or has an ownership interest in, Morgans,
Royalton and Hudson in New York, Delano and Shore Club in South
Beach, Mondrian in Los Angeles and South Beach, Clift in San
Francisco, Ames in Boston, and Sanderson and St Martins Lane in
London. Morgans Hotel Group and an equity partner also own the
Hard Rock Hotel & Casino in Las Vegas and related assets. Morgans
Hotel Group also manages hotels in Isla Verde, Puerto Rico and
Playa del Carmen, Mexico. Morgans Hotel Group has other property
transactions in various stages of completion, including projects
in SoHo, New York and Palm Springs, California.
The Company incurred a net loss attributable to common
stockholders of $66.81 million in 2012, a net loss attributable to
common stockholders of $95.34 million in 2011, and a net loss
attributable to common stockholders of $89.96 million in 2010.
The Company's balance sheet at Sept. 30, 2013, showed $572.83
million in total assets, $745.70 million in total liabilities,
$6.31 million in redeemable noncontrolling interest and $179.18
million total deficit.
MOXIE PATRIOT: S&P Assigns Prelim. 'B+' Rating to $385MM Loan
-------------------------------------------------------------
Standard & Poor's Ratings Services said it assigned its 'B+'
preliminary ratings to Moxie Patriot LLC's $385 million secured
term loan B-1, $200 million term loan B-2, and $53 million LOC
facility. S&P also assigned its preliminary '2' recovery rating
to the debt. The outlook is stable.
Patriot is a special-purpose, bankruptcy-remote operating entity,
set up to build the Patriot Power Plant, an 829-megawatt (MW)
natural gas-fired facility in Clinton Township, Pa. The unit will
dispatch into the West sub-region of the PJM market. Patriot will
be capitalized with roughly $585 million of secured debt and
$256 million of equity. In addition, the project intends to raise
$100 million of mezzanine debt (unrated) at holding company Panda
Patriot Intermediate Holdings II LLC (Panda II).
S&P expects project construction will last until mid-2016. When
complete, Patriot will generate revenue by selling capacity,
energy, and ancillary services into the PJM market. S&P expects
revenues to be somewhat volatile, although capacity payments and
the project's heat rate call option on 400 MW of generation
through 2020 are expected to cover a meaningful portion of fixed
costs and mandatory debt service under S&P's base case
assumptions. Initial leverage is about $698 per kilowatt (kW)
($812/kW inclusive of mezzanine debt), falling to about $465 per
kW ($673/kW, inclusive of mezzanine debt) under S&P's base case
assumptions at maturity, suggesting moderate refinancing risk.
"The outlook is stable and will likely remain at the current level
as the project proceeds through the construction phase," said
Standard & Poor's credit analyst Nora Pickens.
Near-term downside risks can emerge if the project experiences
delays in construction that extend beyond six months. Given S&P's
current expectations of project economics, it expects that ratings
will likely improve as the project goes into commercial
operations. A downgrade is possible if S&P's expectation of debt
at maturity changes to greater than $550 per kW or if debt service
coverage ratios steadily decline below 1.3x. This would likely
result from construction delays, lower-than-expected spark
spreads, poor operational performance, or higher operating and
maintenance costs.
MUD KING: Wants Plan Filing Deadline Extended to March 3
--------------------------------------------------------
Mud King Products, Inc., asks the Bankruptcy Court to further
extend the current exclusivity period to file a plan of
reorganization for approximately 60 additional days, from Dec. 31,
2013, to March 3, 2014, and for an additional 60 days thereafter
in which to confirm a plan. The request for the extension is due
solely to the fact that the motion to estimate the claim of
National Oilwell Varco and the objection to that Claim are not yet
fully resolved.
"Due to the complexities of this litigation, the Court will likely
not render a decision resolving these matters prior to the
expiration of the current exclusivity period," the Debtor relates.
On July 29, 2013, the Court entered an order extending deadline
for the Debtor to file its Chapter 11 Plan and Disclosure
Statement to Nov. 1, 2013, due to the pending hearing on Debtor's
Motion to Estimate the Claim of National Oilwell Varco. On
Oct. 24, 2013, the Court entered an order extending this deadline
until Dec. 31, 2013, with an additional 60 days to confirm a plan.
On Aug. 5, 2013, NOV filed a proof of claim in this case in an
unknown amount related to the NOV Litigation. On Aug. 29, 2013,
the Debtor filed its objection to the NOV Claim.
The Court conducted a seven day trial on Debtor's Motion to
Estimate the Claim of National Oilwell Varco and Objection to
Claim of National Oilwell Varco, along with hearing various other
related motions. Closing arguments concluded on Oct. 16, 2013,
and the Court requested briefing from the parties by Nov. 3, 2013.
According to the Debtor, voluminous briefing regarding complex
issues has been filed and it is unlikely that the Court will be
able to render a decision in this matter prior to the expiration
of the current exclusivity deadline. Once the Court rules, the
Debtor will then need time to prepare and finalize a plan of
reorganization which provides for treatment of its creditors,
including of any allowed claim of National Oilwell Varco.
The Debtor clarifies it is not trying to unnecessarily prolong or
delay these proceedings or pressure its creditors.
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.
NCR CORP: S&P Affirms 'BB+' CCR & Rates New $300MM Notes 'BB'
-------------------------------------------------------------
Standard & Poor's Ratings Services said it affirmed its 'BB+'
corporate credit rating on Duluth, Ga.-based NCR Corp. The
outlook is stable.
S&P also assigned a 'BB' issue-level rating and '5' recovery
rating to NCR's proposed $300 million of 12-year notes, $400
million 10-year notes, and $400 million eight-year notes. The '5'
recovery rating indicates S&P's expectation of modest (10%-30%)
recovery of principal in the event of payment default.
S&P affirmed its 'BBB-' issue-level and '2' recovery rating
(indicating its expectation of substantial (70%-90%) recovery of
principal in the event of a payment default) on the company's
revolving credit facility and term loan A and its 'BB' issue-level
and '5' recovery rating (indicating S&P's expectation of modest
(10%-30%) recovery of principal in the event of payment default)
on the company's senior unsecured notes.
Following the close of the transaction, expected to occur early in
2014, S&P will withdraw the 'B' corporate credit rating on Digital
Insight and the issue-level ratings on its debt.
"The rating reflects our assessments of global technology company
NCR's financial risk as 'significant' (according to our criteria)
and its business risk profile as 'satisfactory,'" said Standard &
Poor's credit analyst Jacob Schlanger.
S&P views industry risk as "moderate" and country risk as "low."
The rating outlook on NCR is stable. S&P expects the company to
use earnings growth and free cash flow to reduce leverage below 4x
over the coming year.
Although not expected in the near term, S&P could raise its rating
if stronger-than-expected earnings growth and free cash flow,
along with asset sales, result in leverage that is sustained at
the high-2x level.
S&P could lower its rating if a macroeconomic slowdown or
operating pressures in NCR's businesses pressure margins and limit
cash flow available for debt reduction with leverage sustained
above 4x.
NET ELEMENT: Shareholders Elect Seven Directors
-----------------------------------------------
Net Element, Inc., held its 2013 annual meeting of shareholders on
Dec. 5, 2013, at which the shareholders:
(1) elected Oleg Firer, Dmitry Kozko, Kenges Rakishev, Mike
Zoi, David P. Kelley II, James Caan and Felix Vulis as
directors;
(2) approved the Company's 2013 Equity Incentive Plan;
(3) ratified the selection of BDO USA, LLP, as the Company's
independent registered public accounting firm for the
fiscal year ending Dec. 31, 2013.
(4) approve, on an advisory (nonbinding) basis, the
compensation of the Company's named executive officers;
(5) approved, on an advisory (nonbinding) basis, the
holding of advisory votes on the compensation of the
Company's named executive officers every three years;
(6) approved the issuance, including for purposes of NASDAQ
Listing Rule 5635, of those number of shares of common
stock of the Company equal to 10 percent of the Company's
issued and outstanding common stock as of the date of
issuance of those shares in exchange for the Company's
acquisition of 10 percent of the outstanding shares of
common stock of TOT Group, Inc., a Delaware corporation,
pursuant to that certain letter agreement, dated Aug. 28,
2013, among the Company, Oleg Firer, Steven Wolberg,
Georgia Notes 18 LLC and Vladimir Sadovskiy.
(7) approved the issuance, including for purposes of NASDAQ
Listing Rule 5635, of 75,000 shares of common stock of the
Company to Curtis Wolfe as severance and compensation for
his service as an employee of the Company until Feb. 15,
2013, the date his employment with the Company was
terminated;
(8) approved the issuance, including for purposes of NASDAQ
Listing Rule 5635, of such number of shares of common stock
of the Company equal to up to 4 percent of the Company's
issued and outstanding common stock as of the date of
issuance of such shares to K 1 Holding Limited; and
(9) approved an amendment to the Company's Amended and Restated
Certificate of Incorporation to change the Company's name
to Net Element, Inc.
On Dec. 5, 2013, the Company filed with the Secretary of State of
the State of Delaware a Certificate of Amendment to its Amended
and Restated Certificate of Incorporation, which changed the
Company's name from Net Element International, Inc., to Net
Element, Inc. The change in the Company's name did not result in
any change in the NASDAQ listing of the Company's common stock,
the quotation of the Company's warrants on the OTCQB market or the
CUSIP number of the Company's common stock or warrants. The
Company's common stock will continue to trade on the NASDAQ
Capital Market under the symbol "NETE" and the Company's warrants
will continue to be quoted on the OTCQB market under the symbol
"NETEW." Security holders are not required to exchange Company
shares or warrants in connection with the name change.
Inks Letter Agreement
On Dec. 5, 2013, Net Element International, Inc. entered into (i)
a letter agreement with TGR Capital, LLC, and K 1 Holding Limited
and (ii) a Services Agreement with K1 Holding.
The K1 Agreement requires the Company to issue to K1 Holding a
number of restricted shares of common stock of the Company equal
to 4 percent of the total issued and outstanding shares of common
stock of the Company at the time of issuance. K1 Holding is an
affiliate of Igor Yakovlevich Krutoy. Mr. Krutoy, through K1
Holding, owns a 33 percent equity interest in MUSIC 1 LLC (a/k/a
OOO Music1), a former subsidiary of the Company. Further, the K1
Agreement requires TGR Capital, LLC, to transfer to K1 Holding
such number of restricted shares of common stock of the Company as
is needed to bring K1 Holding's and Mr. Krutoy's aggregate
beneficial ownership of common stock of the Company to 10 percent
of the total issued and outstanding shares of common stock of the
Company at the time of that transfer. The issuance and transfer
of those shares of common stock to K1 Holding is consideration for
the services to be provided pursuant to the Services Agreement and
for making a $2 million loan to the Company that was made on
May 14, 2013. Each of TGR Capital, LLC and T1T Lab, LLC is an
affiliate of the Company's director and majority shareholder, Mike
Zoi.
The Services Agreement provides that K1 Holding will provide
investor relations services for the Company and its affiliates
outside the United States and that K1 Holding will assist the
Company and its affiliates with future negotiations and
maintaining their relationship with Mobile TeleSystems OJSC,
MegaFon OJSC, OJSC VimpelCom (a/k/a Beeline) and their respective
affiliates. The Company's subsidiary, TOT Money, has agreements
to provide mobile payment processing services for electronic
payments using SMS (short message services, which is a text
messaging service) and MMS (multimedia message services) initiated
by the mobile phone subscribers of each of the Mobile Carriers in
Russia. The term of the Services Agreement expires on Dec. 5,
2015.
About Net Element
Miami, Fla.-based Net Element, Inc. (formerly TOT Energy, Inc.)
currently operates several online media Web sites in the film,
auto racing and emerging music talent markets.
Following the 2011 results, Daszkal Bolton LLP, in Fort
Lauderdale, Florida, expressed substantial doubt about the
Company's ability to continue as a going concern. The independent
auditors noted that the Company has experienced recurring losses
and has an accumulated deficit and stockholders' deficiency at
Dec. 31, 2011.
The Company reported a net loss of $24.85 million in 2011,
compared with a net loss of $3.10 million in 2010. The Company's
balance sheet at Sept. 30, 2013, showed $26.85 million in total
assets, $37.26 million in total liabilities and a $10.40 million
total stockholders' deficit.
NEW YORK CITY OPERA: Online Asset Auction Scheduled for Dec. 19
---------------------------------------------------------------
By order of the U.S. Bankruptcy Court, choice slices of opera
history will be available for purchase in an online auction as
Tiger Group's Remarketing Services division assists in selling the
remaining assets formerly owned by the New York City Opera. One-
of-a-kind costumes as well as props, musical instruments, shop and
support equipment, office furniture and other items will go up for
sale at http://www.SoldTiger.comon December 19, beginning at
10:30 a.m. EST. Online bidding will open approximately one week
before the sale date.
The "people's opera" voluntarily filed for Chapter 11 Bankruptcy
Protection in October 2013 in the U.S Bankruptcy Court, Southern
District of New York (case number 13-bk-13240), citing liquidity
problems, pension obligations and other issues. This final sale
follows a successful January 2013 online auction by Tiger
featuring sets, costumes and props from more than 80 productions
that were housed in the opera company's North Bergen, N.J.
warehouse.
The balance of NYC Opera's inventory of gowns, prop weaponry,
audio/video equipment and other mainstays of its world-famous
productions will be up for sale at this historic auction.
In-person previews -- available by appointment only -- will be on
Wednesday, December 18 from 10:00 a.m. to 4:00 p.m. at two
locations just north and west of Manhattan: 1000 Saw Mill River
Road in Yonkers, N.Y. and 245 Secaucus Road in Secaucus, N.J.
"This is a last chance to own a piece of opera history," said
Jeff Tanenbaum, president of Tiger Remarketing Services. "This
online auction will offer a unique opportunity to a wide range of
interested organizations and individuals -- including opera
houses, production companies, drama departments at educational
institutions, opera aficionados and others -- to choose from a
varied selection of props, costumes and other items at a
significant discount."
Specific items for sale include dresses, gowns, capes, and
uniforms; deactivated firearms, furniture, dishware and
chandeliers; a Lyon & Healy model 23 harp and other musical
instruments; as well as video equipment, projectors, and lighting.
Also available are such shop equipment as table and band saws,
drill presses and belt sanders; and office furniture like desks,
chairs, file cabinets, a conference room table and chairs, in
addition to computers and networking equipment.
For the complete technical specifications and/or digital images of
specific inventory items, visit: http://www.SoldTiger.com
About New York City Opera
New York City Opera, Inc., sought Chapter 11 bankruptcy protection
(Bankr. S.D.N.Y. Case No. 13-13240) on Oct. 3, 2013, estimating
between $1 million and $10 million in both assets and debts.
The petition was signed by George Steel, general manager and
artistic director. Kenneth A. Rosen, Esq., at Lowenstein Sandler
LLP, serves as the opera's counsel. Ewenstein Young & Roth LLP
serves as special counsel.
NEWLEAD HOLDINGS: Incurs $45.2 Million Net Loss in H1 2013
----------------------------------------------------------
NewLead Holdings reported a net loss of $45.16 million on $3.29
million of operating revenues for the six months ended June 30,
2013, as compared with net income of net income of $4.18 million
on $4.93 million of operating revenues for the same period a year
ago.
As of June 30, 2013, the Company had $84.27 million in total
assets, $166.18 million in total liabilities and a $81.91 million
total shareholders' deficit.
"The Company has experienced net losses, negative operating cash
flows, working capital deficiencies, negative operating cash flow
and shareholders' deficiency, which has affected, and which is
expected to continue to affect, its ability to satisfy its
obligations. In addition ... the Company is in default under
various debt obligations which are currently due on demand.
Charter rates for bulkers have experienced a high degree of
volatility and continue to be at historical lows. To date ... the
Company has also been unable to generate sustainable positive cash
flows from operating activities. For the six months ended
June 30, 2013, the Company's loss from continuing operations was
$36,695. As of June 30, 2013, the Company's cash and cash
equivalents were $636 and current liabilities of $166,188 were
payable within the next twelve months.
"The above conditions raise substantial doubt about the Company's
ability to continue as a going concern," the Company said in the
Report.
A copy of the Form 6-K is available for free at:
http://is.gd/5XuOkM
About NewLead Holdings Ltd.
NewLead Holdings Ltd. -- http://www.newleadholdings.com/-- is an
international, vertically integrated shipping company that owns
and manages product tankers and dry bulk vessels. NewLead
currently controls 22 vessels, including six double-hull product
tankers and 16 dry bulk vessels of which two are newbuildings. N
ewLead's common shares are traded under the symbol "NEWL" on the
NASDAQ Global Select Market.
Newlead Holdings incurred a net loss of $403.92 million on $8.92
million of operating revenues for the year ended Dec. 31, 2012, as
compared with a net loss of $290.39 million on $12.22 million of
operating revenues for the year ended Dec. 31, 2011. The Company
incurred a net loss of $86.34 million on $17.43 million of
operating revenues in 2010.
Going Concern Doubt
PricewaterhouseCoopers S.A., in Athens, Greece, 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 a net loss, has negative cash flows
from operations, negative working capital, an accumulated deficit
and has defaulted under its credit facility agreements resulting
in all of its debt being reclassified to current liabilities, all
of which raise substantial doubt about its ability to continue as
a going concern.
NEXTAG INC: S&P Lowers CCR to 'CCC' on Weak Operating Performance
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on San Mateo, Calif.-based NexTag Inc. to 'CCC' from 'B-'.
The outlook is negative.
At the same time, S&P lowered its issue-level rating on the
company's senior secured debt to 'CCC' (at the same level as the
corporate credit rating) from 'B-'. The recovery rating on this
debt remains '3', indicating S&P's expectation for meaningful
(50%-70%) recovery for debtholders in the event of a payment
default.
"The downgrade is based on the company's recent weak operating
performance and our view that the company will need to amend its
credit facility before the end of 2013," said Standard & Poor's
credit analyst Elton Cerda.
In the third quarter of 2013 NexTag experienced a significant
revenue decrease in U.S. product shopping, primarily from
competition, and saw only minimal cost reductions as result of
higher traffic acquisition costs. The company is trying to
establish itself in online consumer search traffic acquisition and
monetization services, in which it helps other e-commerce
companies to acquire Internet traffic and monetize that traffic.
"In our view, the company doesn't have adequate liquidity to fund
the cost associated with developing new sites and product
launches," said Mr. Cerda. "We believe profitability and cash
flow generation are unlikely to return to historical levels as
traffic acquisition costs continue to increase. We do not expect
these trends to reverse."
Standard & Poor's rating on NexTag reflects the difficulty of
maintaining its competitive position in comparison shopping while
attempting to establish itself in traffic acquisition and
monetization services. S&P views NexTag's business risk profile
as "vulnerable," based on its wide array of competitors
(especially Google) and sensitivity to search algorithm changes,
traffic acquisition costs, product development risks, and low
barriers to entry. S&P views the company's financial risk profile
as "highly leveraged," given its expectations for rising debt
leverage, low free cash flow generation, and weak liquidity. S&P
assess the company's management and governance as "fair."
S&P's negative rating outlook reflects its expectation that NexTag
will need an amendment prior to year end, based on its expectation
for continued declines in operating performance.
* * *
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the new S&P rating is down two grades to CCC, or one
level lower than the downgrade issued in mid-November by Moody's
Investors Service.
Last month, Moody's said there is an "elevated probability of
default" stemming from "rapidly deteriorating profitability."
NexTag drew down all of the $25 million revolving credit "despite
its adequate cash balances" and cash flow was down by two-thirds
compared with last year, Moody's said.
Revenue for the company, based in San Mateo, California, fell to
$154 million in the year ended in September from $184 million a
year earlier, according to Moody's.
NexTag is controlled by private-equity investor Providence Equity
Partners Inc.
NNN 123: Court Approves Kaye Scholer as Counsel
-----------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
authorized NNN 123 North Wacker, LLC, and NNN 123 North Wacker
Member, LLC, to employ Kaye Scholer LLP as counsel, nunc pro tunc
to Oct. 4, 2013.
As reported by the TCR on Nov. 14, 2013, Kaye Scholer will:
(a) advise the Debtors with respect to a possible
restructuring, sale or other disposition of the Debtors'
business or assets, in whole or in part;
(b) appear and represent the Debtors before this Court, any
appellate courts, and in their dealings with the Office of
the United States Trustee; and
(c) provide such other legal services and advice to the Debtors
as may become necessary in connection with these Chapter 11
cases.
The Debtor will pay Kaye Scholer at these hourly rates:
Partners $700 - $1,175
Counsel $605 - $800
Associates $310 - $755
Legal Assistants $95 - $340
NNN 123 North Wacker, LLC, filed a Chapter 11 petition (Bankr.
N.D. Ill. Case No. 13-39210) on Oct. 4, 2013 in Chicago,
represented by Andrea Johnson Frost, Esq., at Kaye Scholer LLC, as
counsel. The Debtor disclosed total assets of $24.95 million and
total liabilities of $135.47 million in its Schedules.
Another entity, NNN 123 North Wacker Member LLC, sought
Chapter 11 protection (Case No. 13-39240) on the same day.
NNN 3500: Hires BMC Group as Tabulation Agent
---------------------------------------------
NNN 3500 Maple 26 LLC and its debtor-affiliates seek authorization
from the Hon. Harlin D. Hale of the U.S. Bankruptcy Court for the
Northern District of Texas to employ BMC Group, Inc. as the
Debtors' tabulation agent.
The Debtors require BMC Group to:
(a) serve the Debtors' Plan, Disclosure Statement, and all
related materials, including, but not limited to, all
notices relating to the Plan and Disclosure Statement that
are required to be served on parties in interest in the
Chapter 11 Cases;
(b) print, mail and tabulate ballots for purposes of voting to
accept or reject the Debtors' Plan; and
(c) all other services requested by the Debtors in connection
with the (i) provision of notice of and (ii) solicitation
of votes with respect to the Debtors' Plan.
BMC Group will be paid at these hourly rates:
Project Management $125
Noticing Specialists $95
Analysts $85
Data Entry $25
Call Center $45
Admin Support $55
BMC Group will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Tinamarie Feil, president of Legal Services at BMC Group, assured
the Court that the firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code and does not
represent any interest adverse to the Debtors and their estates.
The Court for the District of Delaware will hold a hearing on the
application on Jan. 22, 2014, at 2:00 p.m. Objections, if any,
are due Dec. 16, 2013.
BMC Group can be reached at:
Tinamarie Feil
BMC GROUP, INC.
600 1st Avenue, Ste 300
Seattle, WA 98104
E-mail: tfeil@bmcgroup.com
Jupiter, Florida-based NNN 3500 Maple 1 LLC filed for Chapter 11
protection (Bankr. N.D. Tex. Case No. 13-34362) on Aug. 29, 2013,
together with 26 of its affiliates.
Bankruptcy Judge Harlin DeWayne Hale presides over the case.
Michelle V. Larson, Esq., at Andrews Kurth, LLP, represents the
Lead Debtor in its restructuring effort. The Lead Debtor
estimated assets at $50 million to $100 million and debts at
$50 million to $100 million. The petitions were signed by Mubeen
Aliniazee, restructuring officer.
NORTEL CORP: U.S. Court Upholds Trial Plan over $7.5-Bil. in Cash
-----------------------------------------------------------------
Tom Hals, writing for Reuters, reported that the fight over
defunct Nortel Networks' $7.5 billion in cash will be decided in
joint U.S.-Canadian court hearings and not in arbitration, a U.S.
appeals court ruled on Dec. 6.
According to the report, the U.S. Court of Appeals for the Third
Circuit in Philadelphia upheld a bankruptcy court ruling in March
that there was never an agreement to use arbitration to divide the
pile of cash among various Nortel estates around the world.
Nortel sought protection from creditors in courts around the world
in 2009 and its businesses were quickly sold, reducing a once-
global corporate giant to little more than a pile of cash, the
report related. But it was never decided how to allocate the
money raised between different insolvency and bankruptcy
proceedings in different countries.
An agreement governing the money refers to undefined "dispute
resolvers" that Nortel's European estates argued was arbitration,
the report said. The U.S. Bankruptcy Court in Wilmington, Delaware
disagreed, and the Court of Appeals affirmed that ruling.
"In context, the words 'dispute resolver(s)' indicate that the
parties allowed themselves latitude to select courts or
arbitrators or others to adjudicate the parties' disputes," wrote
Judge Julio Fuentes in a 17-page opinion, the report cited. "To
respect that contractual latitude, we reject the idea that the
parties must arbitrate disputes over asset allocation."
NORTHERN BEEF: Sold to Lender White Oak for $44.3 Million
---------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Northern Beef Packers LP, which halted operations in
June before filing for Chapter 11 protection in July, was sold to
secured lender White Oak Global Advisors LLC for $44.3 million.
According to the report, the price included $4.85 million in cash,
according to the sale-approval order signed on Dec. 6 by the U.S.
Bankruptcy Court in Aberdeen, South Dakota. White Oak won an in-
court auction.
The sale is to be completed within three business days from the
approval date. The plant in Aberdeen began production in October
2012.
About Northern Beef Packers Limited Partnership
Northern Beef Packers Limited Partnership, which operates a beef
processing facility that opened in October 2012, filed for
Chapter 11 relief (Bankr. D.S.D. Case No. 13-10118) on July 19,
2013. Karl Wagner signed the petition as chief financial officer.
Judge Charles L. Nail, Jr., presides over the case. The Debtor
estimated assets of at least $50 million and debts of at least
$10 million. James M. Cremer, Esq., at Bantz, Gosch, & Cremer,
L.L.C., serves at the Debtor's counsel. Steven H. Silton, Esq.,
at Cozen O'Connor serves as co-counsel. Lincoln Partners Advisors
LLC serves as financial advisors.
The U.S. Trustee has appointed five members to the Official
Committee of Unsecured Creditors in the case. Robbins, Salomon &
Patt, Ltd. serves as it lead counsel. Patrick T. Dougherty serves
as its local counsel.
White Oak Global Advisors, LLC, is providing postpetition
financing. White Oak has extended a $47 million credit bid for
the Debtor's assets. White Oak is the Debtor's largest secured
creditor as of July 19, 2013, the petition date, with a disputed
claim of over $64 million.
OCEANSIDE MILE: Has Access to Cash Collateral Until Jan. 21
-----------------------------------------------------------
Oceanside Mile LLC, dba Seabonay Beach Resort, obtained a Court
order extending an interim stipulation allowing the Debtor to use
cash collateral.
The bankruptcy court held a hearing on Nov. 14, 2013, to consider
a motion by the Debtor for final use of cash collateral through
confirmation of its plan of reorganization. The Debtor's request
was opposed by First-Citizens Bank & Trust Company.
At the conclusion of the Nov. 14 hearing, the Court authorized the
Debtor to continue to use cash collateral through Jan. 21, 2014,
consistent with the terms and conditions set forth in the Interim
Stipulation by and Among the Debtor, First-Citizens Bank & Trust
Company and Mayo Group Concerning the Use of Cash Collateral,
which was approved by the Court on Oct. 29, 2013.
The Debtor asserts that First-Citizens is adequately protected.
Among other forms of adequate protection, the Debtor asserts that
(a) there exists a substantial equity cushion protecting the value
of First-Citizens' interest in the collateral; (b) there is no
evidence that the collateral is depreciating in value; (c) the
Debtor proposes to make interest payments to First Citizens; and
(d) the proposed use of cash collateral preserves the value of the
collateral. The Debtor further insists that it needs to use cash
to fund operations and protect creditors' interests -- as it works
a refinance of First-Citizens' loan, a sale of its Htotel or a
reorganization.
In papers filed with the Court, First-Citizens says it disagrees
with the Debtor and contends that it is not adequately protected.
The Lender believes the purported equity cushion is overstated.
About Oceanside Mile
Oceanside Mile LLC filed a Chapter 11 petition (Bankr. C.D. Cal.
Case No. 13-35286) on Oct. 17, 2013. Arturo Rubinstein signed the
petition as managing member. The Debtor estimated assets of at
least $10 million and liabilities of at least $1 million. Judge
Barry Russell presides over the case.
The Debtor is represented by Sandford L. Frey, Esq., Stuart I.
Koenig, Esq., and Martha C. Wade, Esq., at Creim Macias Koenig &
Frey LLP, in Los Angeles, California.
First-Citizens Bank & Trust Company is represented by Craig H.
Averch, Esq., and Roberto J. Kampfner, Esq., at White & Case LLP,
in Los Angeles, California.
OCZ TECHNOLOGY: Has Interim Authority to Tap $21MM in DIP Loan
--------------------------------------------------------------
Judge Peter J. Walsh of the U.S. Bankruptcy Court for the District
of Delaware gave OCZ Technology Group, Inc., et al., interim
authority to obtain senior secured postpetition financing from
Toshiba Corporation. Toshiba will make available up to an
aggregate amount not to exceed $21 million upon interim approval
of the DIP financing and an amount not to exceed $23.5 million
upon entry of a final order.
The Court also gave the Debtors interim authority to use cash
collateral securing their prepetition indebtedness.
The postpetition obligations will bear interest at the rate of 9%
per annum. On and after the termination date, the applicable
interest rate will automatically increase to 11%.
The DIP lender will be entitled to a fee of 2% of the maximum
amount and supplemental amount under the DIP facility.
All postpetition obligations will be due and payable upon the
earlier to occur of (i) 45 days after the Petition Date, which the
DIP lender, in its sole discretion may extend by up to 15 days, or
(ii) the consummation of any sale or other transfer or disposition
of all, or any material portion, of the assets.
A hearing to consider final approval of the request is scheduled
for Dec. 19, 2013, at 4:00 p.m. (prevailing Eastern time).
Objections are due Dec. 12.
About OCZ
San Jose, Calif.-based OCZ Technology Group, Inc. (Nasdaq: OCZ)
designs, manufactures, and distributes high-performance solid-
state storage solutions and premium computer components.
OCZ and two affiliates on Dec. 2, 2013, filed for Chapter 11
protection (Bankr. D. Del. Lead Case No. 13-13126) with a deal to
sell all assets under 11 U.S.C. Sec. 363 to Toshiba Corporation
for $35 million.
As of the bankruptcy filing, the Debtors had funded indebtedness
of $29.3 million and general unsecured trade obligations of $31.4
million.
OCZ is represented by Michael R. Nestor of Young Conaway Stargatt
& Taylor.
OCZ TECHNOLOGY: Can Pay $4.02MM to Critical Vendors in the Interim
------------------------------------------------------------------
Judge Peter J. Walsh of the U.S. Bankruptcy Court for the District
of Delaware gave interim authority for OCZ Technology Group, Inc.,
et al., to pay the claims asserted by critical vendors. Payments
on account of Critical Vendor Claims must not exceed $4.02 million
without further Court order.
A hearing to consider final approval of the request is set for
Dec. 19, 2013, at 4:00 p.m. (prevailing Eastern time). Objections
are due Dec. 12.
About OCZ
San Jose, Calif.-based OCZ Technology Group, Inc. (Nasdaq: OCZ)
designs, manufactures, and distributes high-performance solid-
state storage solutions and premium computer components.
OCZ and two affiliates on Dec. 2, 2013, filed for Chapter 11
protection (Bankr. D. Del. Lead Case No. 13-13126) with a deal to
sell all assets under 11 U.S.C. Sec. 363 to Toshiba Corporation
for $35 million.
As of the bankruptcy filing, the Debtors had funded indebtedness
of $29.3 million and general unsecured trade obligations of $31.4
million.
OCZ is represented by Michael R. Nestor of Young Conaway Stargatt
& Taylor.
OCZ TECHNOLOGY: Section 341(a) Meeting Set on January 6
-------------------------------------------------------
A meeting of creditors in the bankruptcy case of OCZ Technology
will be held on Jan. 6, 2014, at 10:00 a.m.
This is the first meeting of creditors required under Section
341(a) of the Bankruptcy Code in all bankruptcy cases.
All creditors are invited, but not required, to attend. This
meeting of creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
About OCZ
San Jose, Calif.-based OCZ Technology Group, Inc. (Nasdaq: OCZ)
designs, manufactures, and distributes high-performance solid-
state storage solutions and premium computer components.
OCZ and two affiliates on Dec. 2, 2013, filed for Chapter 11
protection (Bankr. D. Del. Lead Case No. 13-13126) with a deal to
sell all assets under 11 U.S.C. Sec. 363 to Toshiba Corporation
for $35 million.
As of the bankruptcy filing, the Debtors had funded indebtedness
of $29.3 million and general unsecured trade obligations of $31.4
million.
Young Conaway Stargatt & Taylor represents the Debtors as counsel.
Mayer Brown LLP serves as the Debtors' special counsel. Deutsche
Bank is the Debtors' investment banker. The Hon. Peter J. Walsh
presides over the case.
OPAL ACQUISITION: S&P Assigns 'B' CCR Over Merger Deal
------------------------------------------------------
Standard & Poor's Ratings Services said it assigned its 'B'
corporate credit rating to Opal Acquisition Inc. The outlook is
negative.
At the same time, S&P affirmed its 'B' issue-level ratings on Opal
Acquisition Inc.'s first-lien senior secured credit facilities,
which will consist of a $125 million revolver due 2018 (increased
from $100 million) and a $1.22 billion term loan B due 2020
(including the new $395 million incremental term loan). The
recovery ratings on these debt issues are '3' indicating S&P's
expectations for a meaningful (50%-70%) recovery in the event of a
payment default.
In addition, S&P assigned its 'CCC+' issue-level rating to Opal
Acquisition's $610 million senior unsecured notes due 2021. The
recovery rating on this debt issue is '6', indicating S&P's
expectations for a negligible recovery (0%-10%) in the event of a
payment default. A portion of the proceeds from this debt issue
will be used to repay Opal Acquisition Inc.'s $420 million senior
secured second-lien term loan due 2021.
Following Opal's Acquisition's acquisition of One Call Care
Management Inc., which closed on Nov. 27, 2013, S&P also withdrew
its 'B' corporate credit rating on One Call Care Management Inc.
Under the pro-forma current organizational structure, all debt
will reside at Opal Acquisition Inc.
"We based the 'B' corporate credit rating on Opal Acquisition Inc.
on its operating subsidiaries' (One Call and Align) "weak"
business risk profile and its "highly leveraged" financial risk
profile, as defined by our criteria," said credit analyst James
Sung.
The negative outlook reflects the substantial debt burden that
Opal Acquisition has taken on and the potential that S&P would
lower the rating if the company is unable to significantly lower
leverage, according to its plan, to the mid-6x to 7x range over
the next 12 months, at a level S&P considers more sustainable for
the 'B' rating category. This could occur if the company is
unable to execute its merger successfully in terms of achieving
its growth and cost reduction targets, or if the company makes
another large debt-funded acquisition. Moreover, a downgrade
could also be triggered if liquidity is stressed such that sources
of cash fall below 1.2x uses of cash. The negative outlook also
reflects the integration risks associated with the One Call-Align
merger and other recent acquisitions and the potential for cost
synergies to be unrealized or management to become distracted from
running the business.
Upside scenario
S&P would consider a stable outlook if the company is able to
execute its business strategy in terms of growing revenues by a
mid- to high-single-digit growth rate in 2014, lowering operating
costs, and improving its EBITDA margins toward the high end of the
15%-20% range. In addition, the company would need to pay down
debt according to plan and maintain leverage below 6.5x on a
sustained basis. S&P would also expect other key credit measures
to improve, including EBITDA interest coverage of close to 2.5x
and FFO-to-debt of closer to 10%.
ORCHARD SUPPLY: First Amended Plan, Supplement Filed
----------------------------------------------------
BankruptcyData reported that Orchard Supply Hardware Stores filed
with the U.S. Bankruptcy Court a Modified First Amended Chapter 11
Plan of Liquidation.
A related Disclosure Statement was not filed as a result of the
November 12, 2013 Court order approving the Disclosure Statement.
According to the Plan, "On or before the Effective Date, the
Debtors, on their own behalf and on behalf of the beneficiaries,
shall execute the GUC Trust Agreement, in a form reasonably
acceptable to the Creditors Committee, and all other necessary
steps shall be taken to establish the GUC Trust....On the
Effective Date, $500,000 will be paid from the Debtors' Estates to
the GUC Trust for the benefit of holders of Allowed General
Unsecured Claims whose prepetition debts were not assumed by the
Purchaser under the Final APA. The GUC Trust shall handle
reconciliation of Claims for General Unsecured Claims only, with
the GUC Trustee selected by the Creditors Committee. In addition,
the first $250,000 of any proceeds from the Designation Rights
Sale shall be paid to the GUC Trust on the Effective Date (or such
later time as they may be monetized). In the event that the
holders of Senior Secured Term Loan Claims receive a total Cash
Distribution providing a net recovery of 90% of the Senior Secured
Term Loan Claims, the next $1,500,000 of proceeds available for
distribution from the Debtors' estates shall be paid to the GUC
Trust. The holders of Senior Secured Term Loan Claims shall
receive all proceeds of the Sale in excess of the $1,500,000
described above, any proceeds of GOB Sales commenced prior to the
closing of the sale to the Purchaser under the Final APA, and all
proceeds of the Designation Rights Sale in excess of $250,000
until the holders of the Senior Secured Term Loan Claims receive a
net recovery of 100%." The Company further filed a notice that
states, "that pursuant to Article XI.A of the First Amended Plan,
the Debtors have made certain modifications to the First Amended
Plan that the Debtors believe do not materially or adversely
affect the interests, rights or treatment of any Allowed Claims or
Equity Interests (each as defined in the First Amended Plan)
(collectively, the 'Non-Material Modifications')...the Non-
Material Modifications include, among other things, a modification
of Article IV.M of the First Amended Plan to provide for the tax
treatment of the Liquidation Trust (as defined in the First
Amended Plan)."
The Debtor's also filed with the Court a Supplement with respect
to the Modified First Amended Plan, which contains the following
documents: Exhibit A: Schedule 7.1, Exhibit B: liquidating trust
agreement and Exhibit C: GUC trust agreement.
About Orchard Supply
San Jose, Calif.-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, 2013, 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.
The Official Committee of Unsecured Creditors appointed in case
has retained Pachulski Stang Ziehl & Jones LLP as counsel, and
Alvarez & Marsal as financial advisors.
Lowe's Cos. completed the $205 million acquisition of 72 of
Orchard Supply's 91 stores.
The Company changed its name to OSH 1 Liquidating Corporation and
reduced the size and simplified the structure of the Board of
Directors effective as of Aug. 20, 2013.
PABELLON DE LA VICTORIA: Exclusive Plan Filing Deadline Expires
---------------------------------------------------------------
Pabellon De La Victoria Movimiento Iglesias De Fe (MI FE) Inc.'s
deadline to file a plan of reorganization and related disclosure
statement was slated to expire Dec. 1, 2013. As of Dec. 4, no
Chapter 11 plan has been filed with the Court.
In seeking an extension of the deadline to Dec. 1, the Debtor said
it has been working with prospective buyer Wal-Mart in order to
complete negotiation to sell the Debtor's principal property
located at PR-2, Hormigueros, Puerto Rico. Nevertheless, the
prospective buyer has withdrawn its intention to purchase this
property.
According to the Debtor, it continues assiduously to work with two
associations of Christian churces to sell the Hormigueros
property. The Debtor is expecting to complete the negotiation
with key creditor Banco Popular de Puerto Rico to lift the stay
for the Estate's properties that are not needed for the Debtor's
reorganization, and for the sale of Hormigueros property.
About Pabellon De La Victoria
Pabellon De La Victoria Movimiento Iglesias De Fe (MI FE) Inc.,
filed a Chapter 11 petition (Bankr. D.P.R. Case No. 12-08223) in
Ponce, Puerto Rico, on Oct. 16, 2012. Bankruptcy Judge Edward A.
Godoy oversees the case. Gloria M. Justiniano Irizarry, Esq., at
Justiniano's Law Office, in Mayaguez, Puerto Rico, serves as
counsel. The Debtor estimated assets and debts of $10 million to
$50 million. Banco Popular De Puerto Rico has $14 million in
unsecured claims. The petition was signed by Evelyn Dominguez
Ramos, president.
PACIFIC ARCHITECTS: S&P Assigns 'BB-' Rating to $342MM Debts
------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' issue-level
rating to Pacific Architects & Engineers Inc.'s (PAE's) existing
$102 million term loan A and $30 million add-on; the $150 million
revolver; and new $60 million term loan B. The recovery rating is
'2' on each tranche, indicating S&P's expectation that lenders
would receive substantial recovery (70%-90%) in the event of a
payment default. The company will use the proceeds to pay owners
a dividend.
The 'B+' corporate credit rating and stable outlook are unaffected
by the transaction because, while debt is lower than originally
expected, ownership by a private equity firm and the potential for
another debt-financed dividend or other transaction that could
increase leverage eliminates the possibility of an upgrade under
the current ownership structure. S&P now expects a ratio of debt
to EBITDA of slightly below 4x in 2014 compared to previous
expectations of about 4.5x.
In assessing recovery prospects of PAE's debt facilities, S&P
simulates a default scenario in 2017 arising from continued budget
cuts by government agencies that could cause the company to lose
major contracts. PAE generates more than 95% in revenues from
contracts with U.S. government agencies. S&P also assumed margin
pressure, as the U.S. government aims to reduce its costs.
In S&P's simulated default scenario, the company's volumes decline
significantly and margin pressures strain liquidity to the point
at which its revolving credit facility and free cash flow are
insufficient to meet cash interest and mandatory debt repayments.
S&P believes that if PAE were to default, it would continue to
have a viable business model because of the mission-critical
nature of the services it provides for the Department of Defense
and other federal agencies. Additionally, S&P believes lenders
would realize greater recoveries through reorganization rather
than through a liquidation of the business.
S&P used an enterprise value approach to evaluate the secured
lenders' recovery prospects under a stressed scenario. S&P
assumed a stressed EBITDA of $45 million, which represents an
approximate 50% decline from current operating levels.
Simulated default and valuation assumptions:
-- Simulated year of default: 2017
-- EBITDA at emergence: $45 mil.
-- EBITDA multiple: 5x
Simplified waterfall:
Net enterprise value (after 3% admin. costs): $218 mil.
-------------------------------------------------------
-- Collateral value available to secured creditors: $218 mil.
-- Secured first-lien debt: $301 mil.
-- Recovery expectations: 70% to 90%
Note: All debt amounts include six months of prepetition interest.
RATINGS LIST
Pacific Architects & Engineers Inc.
Corporate credit rating B+/Stable/--
Ratings Assigned
Pacific Architects & Engineers Inc.
Senior Secured
$150 mil. revolver due 2017 BB-
Recovery Rating 2
$132 mil. term loan A due 2017 BB-
Recovery Rating 2
$60 mil. term loan B due 2018 BB-
Recovery Rating 2
Ratings Withdrawn
To From
Pacific Architects & Engineers Inc.
Senior Secured
$80 mil. revolver due 2018 N.R. B+
Recovery Rating N.R. 3
$320 mil. term loan due 2018 N.R. B+
Recovery Rating N.R. 3
PEP-PG TEMPE: Auction of Assets Set for Dec. 27
-----------------------------------------------
Assets of PEP-PG Tempe LLC will be sold to the highest bidder at a
public auction slated for Dec. 27, 2013, at 10:00 a.m. The
trustee's sale will be held at the law offices of Quarles & Brady
LLP, at Two North Central Avenue, in Phoenix, Arizona.
The property is located at 1949 East University Drive, Tempe,
Arizona, and serves as collateral to $38.5 million in debt owed to
German American Capital Corporation c/o Situs Holdings LLC.
The servicer of the debt is:
Allen Hanson
2 Embarcadero Center, Suite 1300
San Francisco, CA 94111
The current trustee for the assets is:
Isaac M. Gabriel, Esq.
QUARLES & BRADY LLP
Renaissance One
Two North Central Avenue
Phoenix, AZ 85004-2391
Tel: 602-229-5200
E-mail: isaac.gabriel@quarles.com
For information contact:
Elizabeth A. Hibbs
Elizabeth.hibbs@quarles.com
PLUG POWER: Open Joint Stock Held 4.3% Equity Stake at Sept. 16
---------------------------------------------------------------
In an amended Schedule 13D filed with the U.S. Securities and
Exchange Commission, JSC "INTER RAO Capital" and Open Joint Stock
Company "Inter RAO UES" disclosed that as of Sept. 16, 2013, they
beneficially owned 4,462,693 shares of common stock of Plug Power
Inc. representing 4.3 percent of the shares outstanding. A copy
of the regulatory filing is available at http://is.gd/CbTxOw
About Plug Power
Plug Power Inc. is a provider of alternative energy technology
focused on the design, development, commercialization and
manufacture of fuel cell systems for the industrial off-road
(forklift or material handling) market.
KPMG LLP, in Albany, New York, expressed substantial doubt about
Plug Power's ability to continue as a going concern, following
their audit of the Company's financial statements for the year
ended Dec. 31, 2012, citing the Company's recurring losses from
operations and substantial decline in working capital.
As of Sept. 30, 2013, the Company had $40.03 million in total
assets, $35.36 million in total liabilities, $2.45 million in
series C redeemable convertible preferred stock, and $2.21 million
in total stockholders' equity.
Bankruptcy Warning
"Our cash requirements relate primarily to working capital needed
to operate and grow our business, including funding operating
expenses, growth in inventory to support both shipments of new
units and servicing the installed base, and continued development
and expansion of our products. Our ability to meet our future
liquidity needs, capital requirements, and to achieve
profitability will depend upon numerous factors, including the
timing and quantity of product orders and shipments; the timing
and amount of our operating expenses; the timing and costs of
working capital needs; the timing and costs of building a sales
base; the timing and costs of developing marketing and
distribution channels; the timing and costs of product service
requirements; the timing and costs of hiring and training product
staff; the extent to which our products gain market acceptance;
the timing and costs of product development and introductions; the
extent of our ongoing and any new research and development
programs; and changes in our strategy or our planned activities.
If we are unable to fund our operations without additional
external financing and therefore cannot sustain future operations,
we may be required to delay, reduce and/or cease our operations
and/or seek bankruptcy protection," the Company said in its
quarterly report for the period ended Sept. 30, 2013.
POSITIVEID CORP: Holds 3% Equity Stake in VeriTeQ Corp
------------------------------------------------------
In an amended Schedule 13G filed with the U.S. Securities and
Exhange Commission, PositiveID Corporation disclosed that as of
Nov. 13, 2013, it beneficially owned 300,000 shares of common
stock of VeriTeQ Corporation representing three percent of the
shares outstanding. A copy of the regulatory filing is available
for free at http://is.gd/nOnNF4
About PositiveID
Delray Beach, Fla.-based PositiveID Corporation has historically
developed, marketed and sold RFID systems used for the
identification of people in the healthcare market. Beginning in
early 2011, the Company has focused its strategy on the growth of
its HealthID business, including the continued development of its
GlucoChip, its Easy Check breath glucose detection device, its
iglucose wireless communication system, and potential strategic
acquisition opportunities of businesses that are complementary to
its HealthID business.
PositiveID incurred a net loss of $7.99 million on $0 of revenue
for the year ended Dec. 31, 2012, as compared with a net loss of
$16.48 million on $0 of revenue for the year ended Dec. 31, 2011.
The Company's balance sheet at Sept. 30, 2013, showed $2.09
million in total assets, $7.18 million in total liabilities and a
$5.09 million total stockholders' deficit.
EisnerAmper 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
at Dec. 31, 2012, the Company has a working capital deficiency and
an accumulated deficit. Additionally, the Company has incurred
operating losses since its inception and expects operating losses
to continue during 2013. These conditions raise substantial doubt
about its ability to continue as a going concern.
PROTECTION ONE: S&P Affirms B CCR & B Rating on $100MM Loan Add-on
------------------------------------------------------------------
Standard & Poor's Ratings Services said it affirmed its 'B'
corporate credit rating on Romeoville, Ill.-based Protection One
Inc. The outlook is stable.
In addition, S&P affirmed its 'B+' issue-level rating with a
recovery rating of '2' on the company's $687 million term loan
(which includes the delayed-draw incremental $100 million term
loan add-on) and revolving credit facility. The recovery rating
of '2' indicates S&P's expectation for substantial (70% to 90%)
recovery for lenders in the event of a payment default.
As part of this transaction, the company also plans to increase
its revolving credit facility to $55 million from $40 million
($4 million of the revolver is expected to be funded at closing).
"The rating on Protection One Inc. reflects the company's 'weak'
business risk profile and its 'highly leveraged' financial risk
profile," said Standard & Poor's credit analyst Katarzyna Nolan.
S&P views the industry risk as "intermediate" and the country risk
as "very low". The company's business risk profile is
characterized by its second-tier position in a highly competitive
market with low barriers to entry.
The stable outlook incorporates S&P's expectations that the
company will achieve improved credit metrics over the next year
through revenue and EBITDA growth.
An upgrade in the near term is unlikely given the company's highly
leveraged financial profile and our expectations that it will use
cash flow to finance growth rather than reduce debt, as well as
its financial sponsor ownership, which S&P believes will preclude
sustained deleveraging.
S&P may lower the rating if increased customer creation costs lead
to deterioration in liquidity, such that free operating cash flow
turns negative in a low-growth scenario or the net-leverage
covenant cushion is sustained at less than 15%.
RENTECH NITROGEN: S&P Puts 'B' CCR on CreditWatch Negative
----------------------------------------------------------
Standard & Poor's Ratings Services placed its 'B' corporate credit
rating and other ratings on Rentech Nitrogen Partners L.P. on
CreditWatch with negative implications.
"The rating action reflects our view of the risk for weaker-than-
expected earnings and cash flow as a result of the company's key
East Dubuque, Ill., facility being nonoperational," said Standard
& Poor's credit analyst Paul Kurias. The facility generates the
bulk of the company's EBITDA and cash flow. At this point,
information is not available on the length of time the plant will
remain nonoperational as a result of the reported fire. At the
current rating, S&P expects the company's ratio of total debt to
EBITDA to be about 4x and the funds from operations (FFO) to total
debt ratio to be between 15% and 20%. The ratios were 3.2x and
18%, respectively, as of Sept. 30, 2013, on a 12-month basis.
Rentech has only modest EBITDA cushion under ratios at the
current rating.
The rating action also reflects risks to liquidity as a result of
this operating setback, including the possibility that a
meaningful weakening in EBITDA will make it difficult for the
company to comply with financial covenants that govern a
$35 million revolving credit facility. The covenants are
applicable only if the company utilizes its revolving facility to
the extent of 15% or higher. The facility has been unutilized so
far and the covenants have not been applicable. However, that
could change if the company's operational cash flow weakens,
resulting in a need to borrow under its credit facility to fund
operations. In such a situation a weakening of EBITDA could
result in the company being unable to comply with the facility's
3.75x leverage covenant ratio. The company has relied on
operational cash flow, unutilized proceeds from its $320 million
April 2013 debt issue, and advances from customers to fund itself.
Cash balances as of Sept. 30, 2013, were about $85 million.
However, customer advances on that date were about $34 million,
which S&P considers to be a less sustainable source of funding.
S&P will seek to resolve the CreditWatch after receiving
information on the scope of damage to the company's plant,
potential liabilities arising on account of the incident, and the
likely duration of the shutdown. This information will allow S&P
to realistically estimate the shortfall in EBITDA and cash flow
relative to its expectations and in particular will enable S&P to
estimate accurately the company's liquidity position. S&P could
lower ratings if it believes the company will be unable to meet
the credit metrics discussed here, or if liquidity weakens
meaningfully.
RESIDENTIAL CAPITAL: Second Amended Plan, Exhibits Filed
--------------------------------------------------------
BankruptcyData reported that Residential Capital and its official
committee of unsecured creditors filed with the U.S. Bankruptcy
Court a Revised Second Amended Joint Chapter 11 Plan.
A related Disclosure Statement was not filed as a result of the
August 23, 2013 Court order approving the Disclosure Statement.
The Revised Second Amended Plan includes amended Schedules 5, 6
and 7.
According to the Plan, "Pursuant to section 1123 of the Bankruptcy
Code and Bankruptcy Rule 9019, the Plan incorporates a compromise
and settlement of numerous inter-Debtor, Debtor-Creditor and
inter-Creditor issues designed to achieve an economic settlement
of Claims against the Debtors and Ally and an efficient resolution
of these Chapter 11 Cases. This Global Settlement constitutes a
settlement of the potential litigation of issues including
substantive consolidation, the validity and enforceability of
Intercompany Balances, the allocation of the Available Assets, the
amount and allocation of certain disputed Unsecured Claims, in
addition to the resolution of extensive litigation, Claims, and
potential Claims against Ally. The entry of the Confirmation Order
shall constitute the Bankruptcy Court's approval of each of the
following compromises or settlements and all other compromises and
settlements provided for herein, and the Bankruptcy Court's
findings shall constitute its determination that such compromises
and settlements are in the best interests of the Debtors, their
Estates, Creditors, the RMBS Trusts, Investors, and other parties-
in-interest, and are fair, equitable, and within the range of
reasonableness. Each provision of the Global Settlement shall be
deemed non-severable from each other and from the remaining terms
of the Plan."
In addition, the Company also filed with the Court certain Plan
Exhibits as amended, including the following: Exhibit 1: executory
contracts, unexpired leases and certain post-petition contracts,
which includes the name of the non-Debtor counterparty, the legal
description of the executory contract or unexpired lease to be
assumed and the proposed amount of an associated cure claim, if
any, and Exhibit 13: liquidating trust causes of action and
Exhibit 15: borrower-related causes of action.
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).
REVSTONE INDUSTRIES: Equity Holders' Trustee Hires Ramaekers Group
------------------------------------------------------------------
Homer W. McClarty, the trustee for equity security holders owning
100% of debtors Revstone Industries, LLC and Spara LLC, and their
wholly-owned subsidiaries, asks permission from the U.S.
Bankruptcy Court for the District of Delaware to employ Ramaekers
Group, LLC, to provide Lawrence J. Ramaekers as person responsible
for the debtors-in-possession.
Mr. McClarty also requests to terminate the employment of Huron
Consulting Services, LLC, to avoid duplication of services in
these cases.
Mr. McClarty is an attorney and member of the panel of trustees in
the Bankruptcy Court for the Eastern District of Michigan, and
serves as Trustee of the Hofmeister Children's Trusts. The
Trusts, through Ascalon Enterprises LLC, own 100% of the equity of
Revstone Industries and Spara and their wholly owned subsidiaries.
The Trustee requires Ramaekers Group to:
(a) compile data and documents necessary to support the Company
in its restructuring efforts;
(b) negotiate with creditors and other stakeholders the terms
of their proposed treatment in a plans of reorganization;
(c) negotiate with creditors and other stakeholders the uses of
cash as required by law or the bankruptcy court during the
restructuring effort;
(d) negotiate and document the terms of a debtor-in-possession
and other financing arrangements;
(e) compile data and analyses of information necessary to meet
the reporting requirements that will be mandated by the
bankruptcy process, and assisting with other aspects of
managing the interactions with major constituents,
including covenant compliance, communications, preparation
for meetings and follow up on requests;
(f) compile data and analyses necessary to meet the
requirements and requests of various parties related to
the Company's restructuring and reorganization;
(g) compile and format data and analyses necessary to meet the
financial reporting requirements mandated by the bankruptcy
code and the U.S. Trustee's office;
(h) develop plans to address creditor requirements and
interfacing with creditors and their financial advisors;
(i) assist management with the on-going forecasting of the
Company's cash flows and its operations and monitoring and
analyzing operational and financial condition;
(j) advise on communication plans for various stakeholders
including customers, suppliers, employees, and the
communities in which the Company operates;
(k) address operational challenges that arise due to the
reorganization effort, any bankruptcy filings and
the bankruptcy process;
(l) prepare for court hearings, for the argument of motions and
other matters;
(m) develop a plan of reorganization or liquidation, and
supporting documents;
(n) supervise and advise the Company on the sale of operating
and non-operating assets; and
(o) perform any other restructure management duties relating to
the management of the Company.
Ramaekers Group will be paid at these hourly rates:
Managing Directors $675-$750
Directors $535-$620
Senior Associates $420-$450
Associates $350
Consultants $250
Analyst $175
Ramaekers Group will also be reimbursed for reasonable out-of-
pocket expenses incurred. Hours spent traveling by a Consultant
as part of the engagement will be billed at 50% of the applicable
rate.
Because Ramaekers Group is being employed under section 363 of the
Bankruptcy Code, and not as a professional under section 327, it
is not required to be disinterested.
Mr. McClarty noted that on Oct. 22, 2013, the Bankruptcy Court
took the relatively unusual step of placing on the public record,
the Court's admonitions that (i) little or no progress has been
made in these cases, (ii) the cases are being over-litigated, and
(iii) the cases may be cratering. "As Trustee, it is my duty to
take reasonable and necessary steps to protect the assets of the
Trusts," according to Mr. McClarty.
"Based upon this Court's admonitions and my personal observations
of the status of these cases, Ascalon has retained Lawrence J.
Ramaekers to be the person responsible for the Debtors-in-
Possession. Mr. Ramaekers is a well-known and respected
restructuring expert. He has a reputation for integrity, and for
being fiercely independent," Mr. McClarty said.
On Nov. 18, 2013, as Trustee for the equity holders of Ascalon,
Mr. McClarty adopted a resolution (i) removing George S.
Hofmeister from all of his positions and from any operating
authority, (ii) giving Mr. Ramaekers the title of President of
Ascalon, and (iii) appointing Ramaekers as a member of the Boards
of Managers of Revstone and Spara. Counsel for the Debtors
responded that this resolution was null and void ab initio. In
connection with the bid to install Mr. Ramaekers as person
responsible for the Debtor, he has resigned as President of
Ascalon.
The Court for the District of Delaware will hold a hearing on the
hiring on Dec. 11, 2013, at 10:00 a.m. Objections were due
Dec. 4, 2013.
Ramaekers Group can be reached at:
Lawrence J. Ramaekers
RAMAEKERS GROUP, LLC
6027 Le Lac Road
Boca Raton, FL 33496
Tel: (561) 994-3999
Fax: (561) 995-0053
About Revstone Industries et al.
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. Laura Davis Jones, Esq., at Pachulski Stang
Ziehl & Jones LLP represents Revstone. 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.
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.
Metavation has tapped Pachulski as its counsel. Pachulski also
serves as counsel to Revstone and Spara. Metavation also has
tapped McDonald Hopkins PLC as special counsel, and Rust
Consulting/Omni Bankruptcy as claims agent and to provide
administrative services. Stuart Maue is fee examiner.
Mark L. Desgrosseilliers, Esq., at Womble Carlyle Sandridge &
Rice, LLP, represents the Official Committee of Unsecured
Creditors in Revstone's case.
ROSETTA GENOMICS: Highlights Progress in Letter to Shareholders
---------------------------------------------------------------
Rosetta Genomics Ltd. posted the following Letter to Shareholders
to the Investors section of the Company's Web site at:
http://www.rosettagenomics.com/
Dear Fellow Shareholders:
The past months have been a productive and exciting time for
Rosetta Genomics as we advanced the development of our microRNA-
based platform technologies and the commercialization of our
molecular diagnostic assays. Owing to our position at the
forefront of microRNA-based diagnostics, Rosetta is well
positioned for leadership in personalized medicine with an array
of products to predict, diagnose and treat diseases.
We continued to make progress in the three areas critical to the
successful commercialization of our lead product, the Rosetta
Cancer Origin TestTM: Demand generation, demand fulfillment and
payer management.
We have recently expanded our dedicated sales force from five to
11 territory managers. While it takes a few months for each such
representative to achieve momentum in his or her territory, we
have already begun to see encouraging results. In addition to
their increasing selling efforts, these sales representatives, in
conjunction with Dr. Robert Wassman, Rosetta's chief medical
officer, and Steve Miller, Rosetta's Director of Marketing and
Reimbursement, are making great strides in enhancing awareness of
Cancer of Unknown Primary (CUP) and the need for better
diagnostics to identify the tumor of origin. Through a variety of
educational seminars, and webinars and through outreach to patient
advocacy groups, our team is bringing CUP and our Cancer Origin
Test to the attention of pathologists, oncologists and patients in
order to drive demand. Toward that end we are growing our
customer base, and increasing the number of samples we receive for
processing.
Both October and November marked successive record-breaking months
for Rosetta in terms of sample volume. Compared to October and
November of 2012, we have experienced growth of approximately 2.5-
fold and 5-fold, respectively, in terms of samples received in our
CLIA lab in Philadelphia. Compared to the average of the first
nine months in 2013, these past two months have seen sample volume
almost double, a testament to the hard work of our expanded sales
force as well as our marketing efforts.
In terms of processed samples, November was by far the strongest
month for our Cancer Origin Test, as we processed nearly 50% more
samples in November than we had processed during our previous
record month. Our year-to-date gross billings have grown by 100%
compared to same period last year. We estimate our gross billings
will pass the $1 million dollar mark by year-end.
We are enhancing awareness and increasing demand with the
continued publication and presentation of data in support of our
microRNA-based diagnostics. In October, we presented data from a
study of the Cancer Origin Test at the American Society of Human
Genetics Annual Meeting. The data showed that our Cancer Origin
Test may be of utility in clarifying the cancer risk in pedigrees
of families with a history of unknown or uncertain cancers. The
findings showed a high frequency of breast, ovarian and colon
cancers, including significant numbers of male breast cancers in
the CUP population, as well as relatively high frequencies of rare
cancers with high familial risk. This demonstrates that pedigrees
with unresolved diagnoses from CUP cases could be highly
informative if the Cancer Origin Test is applied. The unique
stability of microRNA in FFPE preserved tissues makes these
analyses possible where they would not be with other analytes such
as mRNA, and we believe familial risk assessment could expand the
market opportunity for our Cancer Origin Test over time.
We are strengthening global initiatives to enhance patient access
to our microRNA-based testing services. For example, we recently
expanded our distribution agreement with GeneKor Medical S.A for
the sales and marketing of our entire suite of microRNA-based
cancer testing services in Romania and Turkey, in addition to our
original agreement covering Greece. This new agreement
underscores our commitment to expand personalized medicine across
the globe, and to help improve patient outcomes. We expect to
continue to pursue international distribution agreements and look
forward to reporting progress throughout 2014.
We significantly increased Rosetta's demand fulfillment
capabilities by doubling the capacity of our laboratory operations
in Philadelphia. We have trained additional staff and have room
for further expansion down the line if and when needed. In
addition, we have established a world-class customer service
offering, which continues to be an important component for our
ongoing success.
Reimbursement and payor management are critical to the success of
any therapeutic or diagnostic product. At Rosetta we are
committed to providing the continued support and investment needed
for the widespread adoption and commercial success of our
products. In August 2013, we were pleased to report the final
revised Local Coverage Determination from the designated Medicare
Administrative Contractor for our Cancer Origin Test and we
continue to receive approximately $3,500 for each test processed
for eligible patients covered under the Medicare program.
As Medicare accounts for only a portion of the CUP tests
processed, we are working to obtain favorable reimbursement from
commercial payors as well. Here we are investing our resources -
both human and financial - to establish a variety of credentialing
agreements and otherwise to seek more frequent and robust payment
from commercial payors. One example is our ongoing prospective
study in Israel to evaluate outcomes of CUP patients with therapy
directed by the results of our Cancer Origin Test compared with
standard treatment. Through this study we are assessing the real-
world clinical impact and cost-effectiveness of our Cancer Origin
Test to demonstrate that use of the test early in the diagnostic
workup improves the pharmacoeconomics for the treatment of CUP
patients. We look forward to having some data from this study
available in the first half of 2014.
In addition we have made significant progress executing
credentialing agreements for our Cancer Origin Test with four U.S.
national healthcare network providers, increasing coverage for
this test to more than 100 million Americans. We expect to
announce additional agreements in the near term, which should
significantly expand coverage of our Cancer Origin Test to
millions more.
Recently we were pleased to report our first payment from the
U.K.'s National Health Service (NHS) for our Cancer Origin Test.
While this does not signify a universal policy decision, it does
represent a pathway for individual patients in the U.K. to gain
access to this important test and shows that the NHS recognizes
the clinical value of our Cancer Origin Test, in conjunction with
the treating oncologist's assessment. It also advances our goal
to enhance awareness of and access to our Cancer Origin Test in
overseas markets.
As microRNA technology is garnering attention from the scientific,
medical and commercial drug-development communities, we believe
the time is right to invest in reinvigorating our R&D efforts.
Toward that end we were pleased to announce our sponsored research
agreement with Ramot at Tel Aviv University for the joint
development of a nano-carrier delivery system miR mimetic
technology to treat a variety of cancers. This is a potentially
breakthrough program, which will allow us to harness the power of
microRNA to potentially develop effective new cancer treatments.
As this research is being partially funded by Israel's Office of
the Chief Scientist, it is a cost-effective way for us to leverage
our intellectual property and expand our footprint in cancer
therapeutics.
In addition we are advancing development work on a tissue-based
initiative underway for a diagnostic assay that rules out a
particular cancer, thereby avoiding unnecessary surgeries and
saving the healthcare system significant expense while sparing the
patient the morbidities associated with surgery. We have several
other R&D programs underway or soon to begin that we will be
discussing in the near future.
We continue to pursue patent protection for our intellectual
property and are pleased to have added six U.S. patents to our
growing portfolio during 2013. As a result we have 33 issued
patents, including 30 in the U.S. In addition we have 43 patent
applications pending, of which 23 are in the U.S. These
applications protect the specific microRNAs used in our products
and cover composition of matter, diagnostic applications,
therapeutic applications and discovery process applications for
microRNAs in humans.
This leading patent position provides access to hundreds of
potential microRNA biomarkers while our proprietary discovery,
extraction and quantification technologies enable the rapid
expansion of our pipeline. Importantly we maintain an extensive
network of collaborations with leading research centers that
provide input from the forefront of medical research as well as
access to hundreds of sample types. This solid intellectual
property position allows us to protect current products, provides
the backbone for new product development and offers the potential
for multiple opportunities for research, development and
commercial partnerships.
In addition to driving growth through our currently marketed
products and from new products derived from our development
engine, we are looking at other ways to grow our revenue base. We
are in discussions with a number of diagnostics and therapeutics
companies, which if successful, would allow us to leverage our
cutting-edge microRNA platforms and capabilities for these
companies' biomarker and other needs. We believe this has the
potential to become another important source of revenues for us in
the near term. We also are looking at bringing other products into
Rosetta to leverage the investments we are making in our
commercial infrastructure and to potentially accelerate our
revenue growth.
Moving forward we will continue to make investments in commercial
operations and in the further clinical development of our microRNA
technology. We expect that our cash position at the end of 2013
of more than $20 million along with the projected revenue from our
testing services will be sufficient to fund our operations well
into 2015.
We are very pleased with the progress we have made to date and
expect 2014 to be an exciting year of growth and accomplishments
as we advance our strategic plan in pursuit of our mission to be
the pioneering force in microRNA-based personalized medicine to
the benefit of patients worldwide.
On behalf of my colleagues and our Board of Directors, thank you
for your interest in Rosetta Genomics.
Sincerely,
Kenneth A. Berlin
President and Chief Executive Officer
About Rosetta
Based in Rehovot, Israel, Rosetta Genomics Ltd. is seeking to
develop and commercialize new diagnostic tests based on a recently
discovered group of genes known as microRNAs. MicroRNAs are
naturally expressed, or produced, using instructions encoded in
DNA and are believed to play an important role in normal function
and in various pathologies. The Company has established a CLIA-
certified laboratory in Philadelphia, which enables the Company to
develop, validate and commercialize its own diagnostic tests
applying its microRNA technology.
Rosetta Genomics disclosed a net loss of US$10.45 million on
US$201,000 of revenue for the year ended Dec. 31, 2012, as
compared with a net loss of US$8.83 million on US$103,000 of
revenue during the prior year. As of June 30, 2013, the Company
had $30.28 million in total assets, $2.34 million in total
liabilities and $27.93 million in total shareholders' equity.
Bankruptcy Warning
In its annual report for the year ended Dec. 31, 2012, the Company
said:
"We will require substantial additional funding and expect to
augment our cash balance through financing transactions, including
the issuance of debt or equity securities and further strategic
collaborations. On December 7, 2012, we filed a shelf
registration statement on Form F-3 with the SEC for the issuance
of ordinary shares, various series of debt securities and/or
warrants to purchase any of such securities, either individually
or in units, with a total value of up to $75 million, from time to
time at prices and on terms to be determined at the time of such
offerings. The filing was declared effective on December 19,
2012. However there can be no assurance that we will be able to
obtain adequate levels of additional funding on favorable terms,
if at all. If adequate funds are not available, we may be
required to:
* delay, reduce the scope of or eliminate certain research and
development programs;
* obtain funds through arrangements with collaborators or
others on terms unfavorable to us or that may require us to
relinquish rights to certain technologies or products that we
might otherwise seek to develop or commercialize
independently;
* monetizing certain of our assets;
* pursue merger or acquisition strategies; or
* seek protection under the bankruptcy laws of Israel and the
United States."
ROUNDYS SUPERMARKETS: Moody's Rates $200MM Second Lien Notes 'B3'
-----------------------------------------------------------------
Moody's Investors Service assigned a B3 rating to Roundy's
Supermarkets, Inc. proposed $200 million second lien notes.
Moody's affirmed the B2 Corporate Family Rating and existing
instrument ratings and revised the Probability of Default Rating
to B2-PD from B3-PD. The rating outlook remains negative. The
proposed $200 million in second lien notes will be utilized to
repay approximately $150 million of the term loan, with remaining
proceeds to be used to acquire 11 Dominick's locations in the
Metro Chicago market from Safeway.
The following rating is assigned:
$200 million Second Lien Notes at B3 (LGD 4, 69%)
The following ratings are affirmed:
Corporate Family Rating at B2
$125 million First Lien Revolving Credit Facility expiring
February 2017 at B1 (LGD3, 32% from LGD2, 23%)
$667 million First Lien Term Loan maturing February 2019 at B1
(LGD3, 32% from LGD2, 23%)
The following rating is upgraded:
Probability of Default Rating to B2-PD from B3-PD
Ratings Rationale:
The company's B2 Corporate Family Rating reflects its high
leverage, small size, geographic concentration, and increasing
competition from alternative food retailers which continues to
pressure revenue growth and margins. Additional rating factors
include Roundy's meaningful regional presence which Moody's
believes will improve over time with the addition of the
Dominick's locations, as well as the company's good liquidity.
While Moody's believes the Dominick's acquisition makes strategic
sense, Moody's notes that Roundy's will be integrating this
acquisition while at the same time experiencing challenges in its
core business, which increases the overall risk profile for the
company over the intermediate term.
The upgrade of the Probability of Default rating to B2-PD from B3-
PD reflects the implementation of a more complex capital structure
with the introduction of second lien debt, consistent with Moody's
Loss Given Default Methodology.
The negative outlook reflects uncertainty regarding Roundy's
ability to improve credit metrics given the challenging operating
environment facing its legacy businesses and the incremental debt
resulting from the Dominick's acquisition.
The ratings could be downgraded if Roundy's liquidity weakens or
the company fails to stabilize or improve same store sales and
operating performance such that debt/EBITDA does not demonstrate
meaningful progress towards 6.0 times over the intermediate term.
Ratings could also be downgraded if EBITA/interest expense is
sustained below 1.5 times for an extended period of time. A shift
towards an aggressive financial policy could also pressure
ratings. In addition, ratings could be downgraded in the event the
integration of Dominick's does not progress smoothly, or if it
does not begin to generate positive returns during 2015.
While an upgrade in the intermediate term is unlikely given the
negative outlook, over time ratings could be upgraded if same
store sales are positive on a sustained basis, operating margins
and credit metrics demonstrate improving trends while it generates
positive free cash flow and maintains good liquidity, which would
be reflective of seamless integration of the Dominick's locations.
Quantitatively, an upgrade would require debt/EBITDA to be
sustained below 5.25 times and EBITA/interest is sustained above
2.0 times.
Roundy's Supermarkets Inc., headquartered in Milwaukee, Wisconsin,
operates 163 retail grocery stores and 101 pharmacies in
Wisconsin, Illinois and Minnesota primarily under the Pick `n'
Save, Copps, Mariano's, Rainbow and Metro Market banners. Revenues
are about $3.9 billion for the LTM period ended September 28,
2013. It has also agreed to acquire 11 Dominck's locations in the
Metro Chicago market from Safeway. Willis Stein funds owns
approximately 32% of the company's stock.
RTL-WESTCAN: S&P Removes B+ CCR on CreditWatch & Withdraws Rating
-----------------------------------------------------------------
Standard & Poor's Ratings Services said it removed RTL-Westcan
Ltd. Partnership from CreditWatch, where it had been placed with
negative implications Nov. 19, 2013. At the same time, Standard &
Poor's affirmed its 'B+' long-term corporate credit rating with a
stable outlook on the company. Subsequently, Standard & Poor's
withdrew the ratings at the company's request.
The ratings on the company had been equalized with those on Kenan
Advantage Group Inc. on Kenan's acquisition of RTL-Westcan. As
noted in S&P's November 2013 release, it placed its ratings on
RTL-Westcan on CreditWatch pending the resolution of its
CreditWatch on Kenan after which S&P would equalize the ratings on
RTL-Westcan with those on Kenan.
RTL-Westcan's C$130 million senior secured notes have been
defeased, full funding has been placed in trust as of Nov. 15,
2013, and the nonrevocable repayment notice has been issued on the
notes. The notes will be redeemed on Dec. 15, 2013.
RURAL/METRO CORP: Wants Plan Filing Period Extended to Jan. 31
--------------------------------------------------------------
Rural/Metro Corporation, et al., ask the Bankruptcy Court to
extend the period during which they have the exclusive right to
file a Chapter 11 plan through Jan. 31, 2014, and the period
during which they have the exclusive right to solicit acceptances
thereof through April 1, 2014.
On Sept. 15, 2013, the Debtors filed the Joint Chapter 11 Plan of
Reorganization for Rural/Metro Corporation and Its Affiliated
Debtors and the Disclosure Statement with Respect to Joint Chapter
11 Plan of Reorganization for Rural/Metro Corporation and Its
Affiliated Debtors with this Court. On Oct. 31, 2013, the
Debtors filed their First Amended Joint Chapter 11 Plan of
Reorganization for Rural/Metro Corporation and Its Affiliated
Debtors and related disclosure statement. On Nov. 5, 2013, the
Court entered an order approving the Disclosure Statement.
A hearing to consider the Debtors' proposed plan of reorganization
has been scheduled for Dec. 17, 2013, however, the Debtors'
Exclusive Filing Period has expired on Dec. 2, 2013. Therefore,
in an abundance of caution, the Debtors' request that the
Court extend the Exclusive Periods in order to preserve their
exclusivity through confirmation and effectiveness and to maximize
the likelihood of emergence in the near term with
minimum distractions.
"Because the Plan contains numerous conditions precedent to Plan
confirmation and effectiveness, the precautionary extension of the
Exclusive Periods that the Debtors are seeking will provide the
Debtors with ample breathing space in the unlikely event that one
of these conditions is not timely satisfied," says Maris J.
Kandestin, Esq., at YOUNG CONAWAY STARGATT & TAYLOR, LLP, counsel
for the Debtors.
The Debtors have been operating under the protections of Chapter
11 for just under four months. During this short period of time,
the Debtors have worked diligently: (i) negotiating and entering
into a debtor-in-possession financing agreement, (ii) responding
to requests and inquiries from their vendors, customers,
employees, and other creditors, (iii) producing monthly operating
reports and other reports, (iv) preparing and filing their
schedules of assets and liabilities and statements of financial
affairs, (v) establishing a bar date for these chapter 11 cases;
(vi) preparing and obtaining approval of the Disclosure Statement;
and (vii) preparing and negotiating the terms of the Plan and
commencing the solicitation of votes with respect thereto.
"Accomplishing these milestones within four months has been a
labor-intensive process, fully occupying the Debtors' employees
and substantially all of the Debtors' professionals retained in
these cases," Mr. Kandestin tells the Court.
About Rural/Metro Corp
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 was acquired in 2011 in a
leveraged buyout by Warburg Pincus LLC as part of a transaction
valued at $676.5 million.
Rural/Metro Corp. and 59 affiliates sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 13-11952) on Aug. 4, 2013, before
the U.S. Bankruptcy Court for the District of Delaware. Debt
includes $318.5 million on a secured term loan and $109 million on
a revolving credit with Credit Suisse AG serving as agent. There
is $312.2 million owing on two issues of 10.125 percent senior
unsecured notes.
The Debtors' lead bankruptcy counsel are Matthew A. Feldman, Esq.,
Rachel C. Strickland, Esq., and Daniel Forman, Esq., at Willkie
Farr & Gallagher LLP, in New York. Maris J. Kandestin, Esq., and
Edmon L. Morton, Esq., at Young, Conaway, Stargatt & Taylor, LLP,
in Wilmington, Delaware, serve as the Debtors' local Delaware
counsel.
Alvarez & Marsal Healthcare Industry Group, LLC, and FTI
Consulting, Inc., are the Debtors' financial advisors, while
Lazard Freres & Co. L.L.C. is their investment banker. Donlin,
Recano & Company, Inc., is the Debtors' claims and noticing agent.
The U.S. Trustee has appointed a three-member official committee
of unsecured creditors in the Chapter 11 case.
The Debtors have arranged $75 million of DIP financing from a
group of prepetition lenders led by Credit Suisse AG. An interim
order has allowed the Debtors to access $40 million of the DIP
facility.
The Debtors have filed a reorganization plan largely worked out
before the Chapter 11 filing in early August. Existing
shareholders receive nothing in the plan.
The Company's debt includes $318.5 million on a secured term loan
and $109 million on a revolving credit with Credit Suisse AG
serving as agent. There is $312.2 million owing on two issues of
10.125 percent senior unsecured notes.
SCOTTSDALE VENETIAN: Has Access to Cash Collateral Until Jan. 15
----------------------------------------------------------------
The Bankruptcy Court entered a Fifth Stipulated Order authorizing
Scottsdale Venetian Village, LLC, to use the cash collateral of
First National Bank of Hutchinson from Dec. 1, 2013, through and
including Jan. 15, 2014. As of the Petition Date, the Debtor was
indebted to the Lender $6,662,171.
The Debtor may use Cash Collateral for the payment of reasonable
and necessary expenses incurred in the ordinary course of the
operation of the Property within a 10 percent variance of the
terms of the budget. The Debtor is prohibited from making any
expenditure beyond the Budget without Lender's written approval or
an order of the Bankruptcy Court authorizing that expenditure.
In addition to the Lender's post-petition lien on the Property and
Cash Collateral as provided in the Bankruptcy Code, including in
particular Section 552(b), as adequate protection for the
Lender's interests as of the Petition Date in the Prepetition
Collateral, the Lender is granted, pursuant to Sections 361 and
363 of the Bankruptcy Code, continuing valid, choate, perfected,
enforceable and non-avoidable security interests in and liens and
mortgages upon all assets and property of the Debtor and the
Estate, of any kind or nature whatsoever, whether now existing or
hereafter acquired or arising, and all proceeds, rents, products
or profits thereof to the same extent and priority as the Lender's
prepetition security interests liens and mortgages, to the extent
of any diminution in value of the Prepetition Collateral.
In addition, the Debtor will make monthly adequate protection
payments to the Lender in the amount of $5,500, which payment must
be made no later than the 10th day of each month, and will be
applied to post-petition interest accruing on the indebtedness.
A copy of the Cash Collateral Order is available for free at:
http://bankrupt.com/misc/SCOTTSDALEcashcollORD.pdf
About Scottsdale Venetian
Scottsdale Venetian Village, LLC, operates the Days Hotel located
at 5101 N. Scottsdale Road, in Scottsdale, Arizona. The Company
also operates Papi Chulo's Mexican Grill & Cantina, located
immediately adjacent to the hotel. The hotel consists of 211
guest rooms and, among other things, facilities for meetings and
banquets.
Scottsdale Venetian Village filed a Chapter 11 petition (Bankr. D.
Ariz. Case No. 13-02150) on Feb. 19, 2013, in Phoenix, estimating
at least $10 million in assets and less than $10 million in
liabilities.
The Debtor is represented by John J. Hebert, Esq., and Wesley D.
Ray at Polsinelli Shughart, P.C., in Phoenix. Charles B. Foley,
CPA, PLLC serves as the Debtor's accountant.
SEQUENOM INC: R. Lindsay to Retire as EVP - Strategic Planning
--------------------------------------------------------------
Ronald M. Lindsay informed Sequenom, Inc., that he will retire
from employment with the Company as of Dec. 31, 2013. Dr. Lindsay
and the Company intend that Dr. Lindsay will continue to serve as
a member of the Company's Board of Directors following his
retirement.
The Company previously disclosed that Dr. Lindsay, the Company's
executive vice president, Strategic Planning, would transition to
part-time employment with the Company, effective Aug. 1, 2013.
About Sequenom
Sequenom, Inc. (NASDAQ: SQNM) -- http://www.sequenom.com/-- is a
life sciences company committed to improving healthcare through
revolutionary genetic analysis solutions. Sequenom develops
innovative technology, products and diagnostic tests that target
and serve discovery and clinical research, and molecular
diagnostics markets. The company was founded in 1994 and is
headquartered in San Diego, California.
Sequenom disclosed a net loss of $117.02 million in 2012, a net
loss of $74.13 million in 2011 and a net loss of $120.84 million
in 2010. The Company's balance sheet at Sept. 30, 2013, showed
$164.82 million in total assets, $195.85 million in total
liabilities and a $31.02 million total stockholders' deficit.
SEARS HOLDINGS: Plans to Spin-Off Lands' End Business
-----------------------------------------------------
Sears Holdings Corporation said that in connection with its
previously announced consideration of a separation of its Lands'
End business, Lands' End, Inc., filed a registration statement on
Form 10 with the Securities and Exchange Commission. Sears
Holdings intends to spin off its Lands' End business through the
pro rata distribution of all of the shares of common stock of
Lands' End, Inc.
Sears Holdings expects that the spin-off will be tax-free to U.S.
stockholders except for any cash received in lieu of fractional
shares. The spin-off is subject to the approval of the Board of
Directors of Sears Holdings and the satisfaction of certain other
conditions. Sears Holdings may, at any time until the spin-off,
decide to abandon the spin-off or modify or change the terms of
the spin-off. Holders of Sears Holdings common stock as of the
record date for the spin-off will not be required to make any
payment, surrender or exchange any shares of Sears Holdings common
stock or take any other action to participate in the spin-off.
About Sears
Hoffman Estates, Illinois-based Sears Holdings Corporation
(Nasdaq: SHLD) -- http://www.searsholdings.com/-- operates full-
line and specialty retail stores in the United States and Canada.
Sears Holdings operates through its subsidiaries, including Sears,
Roebuck and Co. and Kmart Corporation. Sears Holdings also owns a
94 percent stake in Sears Canada and an 80.1 percent stake in
Orchard Supply Hardware. Key proprietary brands include Kenmore,
Craftsman and DieHard, and a broad apparel offering, including
such well-known labels as Lands' End, Jaclyn Smith and Joe Boxer,
as well as the Apostrophe and Covington brands. It also has the
Country Living collection, which is offered by Sears and Kmart.
Kmart Corporation and 37 of its U.S. subsidiaries filed voluntary
Chapter 11 petitions (Bankr. N.D. Ill. Lead Case No. 02-02474) on
Jan. 22, 2002. Kmart emerged from chapter 11 protection on May 6,
2003, pursuant to the terms of an Amended Joint Plan of
Reorganization. John Wm. "Jack" Butler, Jr., Esq., at Skadden,
Arps, Slate, Meagher & Flom, LLP, represented the retailer in its
restructuring efforts. The Company's balance sheet showed
$16,287,000,000 in assets and $10,348,000,000 in debts when it
sought chapter 11 protection. Kmart bought Sears, Roebuck & Co.,
for $11 billion to create the third-largest U.S. retailer, behind
Wal-Mart and Target, and generate $55 billion in annual revenues.
Kmart completed its merger with Sears on March 24, 2005.
The Company's balance sheet at Nov. 2, 2013, showed $20.20 billion
in total assets, $17.88 billion in total liabilities and $2.32
billion in total equity.
Negative Outlook
Standard & Poor's Ratings Services in January 2012 lowered its
corporate credit rating on Hoffman Estates, Ill.-based Sears
Holdings Corp. to 'CCC+' from 'B'. "We removed the rating from
CreditWatch, where we had placed it with negative implications on
Dec. 28, 2011. We are also lowering the short-term and commercial
paper rating to 'C' from 'B-2'. The rating outlook is negative,"
S&P said.
"The corporate credit rating reflects our projection that Sears'
EBITDA will be negative in 2012, given our expectations for
continued sales and margin pressure," said Standard & Poor's
credit analyst Ana Lai. She added, "We further expect that
liquidity could be constrained in 2013 absent a turnaround
or substantial asset sales to fund operating losses."
Moody's Investors Service in January 2012 lowered Sears Holdings
Family and Probability of Default Ratings to B3 from B1.
The outlook remains negative. At the same time Moody's affirmed
Sears' Speculative Grade Liquidity Rating at SGL-2.
The rating action reflects Moody's expectations that Sears will
report a significant operating loss in fiscal 2011. Moody's added
that the rating action also reflects the company's persistent
negative trends in sales, which continue to significantly
underperform peers.
As reported by the TCR on Dec. 7, 2012, Fitch Ratings has affirmed
its long-term Issuer Default Ratings (IDR) on Sears Holdings
Corporation (Holdings) and its various subsidiary entities
(collectively, Sears) at 'CCC' citing that The magnitude of Sears'
decline in profitability and lack of visibility to turn operations
around remains a major concern.
SHELBOURNE NORTH WATER: Files List of 20 Top Unsecured Creditors
----------------------------------------------------------------
Shelbourne North Water Street, L.P., filed with the U.S.
Bankruptcy Court for the District of Delaware a list of 20 largest
unsecured creditors, disclosing:
Name of Creditor Nature of Claim Amount of Claim
---------------- --------------- ---------------
Altus Group Limited Design $808,634
212 King Street West, 3rd Floor
Toronto, ON
Gensler Design $590,000
4549 Collections Center Drive
Chicago, IL 60693
Knight Engineering Associates Design $561,069
221 N. LaSalle Street, Suite 300
Chocago, IL 60601
OMD USA. Inc. Marketing $252,498
195 Broadway, 28th Floor
New York, NY 10007
DLA Piper Legal $174,758
Margue Marketing $170,380
Buro Happold Design $152,442
Savills Unex House Sales $131,641
Distinctive Lifestyle Design $97,855
Schirmer Design $50,350
LAM Partners, Inc. Design $35,000
Van Duesen $32,000
Michigan Avenue Marketing $25,500
Alfred Benesch & Company Design $25,298
Decibella Venter & Santore Design $20,620
Weidlinger Associates, Inc. Design $19,517
Studio V. Architecture Design $13,530
Daniel Weinbach & Partners LTD Design $12,546
Prime Scaffold Vendor $10,260
Clune Construction Construction $7,620
Albrizzi-Williams Financing $7,500
Riverview Condominium Association Legal $5,622
City Front Center East Legal $5,135
Maintenance Association
East Water Place Home Owners Legal $3,390
About Shelbourne North Water Street L.P.
A group of creditors filed an involuntary Chapter 11 petition
against Chicago, Illinois-based Shelbourne North Water Street L.P.
on Oct. 10, 2013 (Bankr. D. Del. Case Number 13-12652). The case
is assigned to Judge Kevin J. Carey.
The petitioners are represented by Zachary I Shapiro, Esq., and
Russell C. Silberglied, Esq., at Richards, Layton & Finger, P.A.,
in Wilmington, Delaware.
The Debtor consented on Nov. 8, 2013, to being in Chapter 11
reorganization.
The Debtor tapped FrankGecker LLP as counsel.
SIERRA HAMILTON: S&P Assigns 'B-' CCR & Rates $110MM Notes 'B-'
---------------------------------------------------------------
Standard & Poor's Ratings Services said it assigned its 'B-'
corporate credit rating to Midland-based Sierra Hamilton LLC. The
outlook is stable.
At the same time, S&P assigned its 'B-' issue rating (same as the
corporate credit rating) to Sierra Hamilton's proposed
$110 million senior secured notes due 2018. The recovery rating
is '4', indicating S&P's expectation of average (30% to 50%)
recovery in the event of a payment default. The bonds are being
co-issued by Sierra Hamilton Finance Inc.
S&P expects Sierra Hamilton will use proceeds from the proposed
notes to pay a $30 million dividend to its owners and to repay
about $69.5 million of existing debt.
"The stable outlook reflects our expectation that debt leverage
will remain about 4x and that liquidity will be adequate," said
Standard & Poor's credit analyst Paul Harvey. "In addition, we do
not expect distributions above expected management fees and
interest expense to Holdings of about $2.9 million per year."
An upgrade over the next 12 to 18 months is unlikely. For an
upgrade, S&P would expect Sierra Hamilton to be able to maintain
debt to EBITDA below 5x throughout the business cycle, which
implies trough level EBITDA of about $25 million with the current
capital structure. Given S&P's forecasted EBITDA of about
$30 million per year over the next 24 months, there is limited
cushion to a market downturn.
S&P could lower ratings if liquidity fell below $10 million. This
could occur due to a prolonged downturn in exploration and
production spending, likely due to low hydrocarbon prices.
SIMPLER SOLAR: Wins $57,000 Judgment Against Renitta
----------------------------------------------------
Senior District Judge William Stafford in Tallahassee, Florida,
granted summary judgment to Simpler Solar Systems, Inc., in its
lawsuit against Renitta Knight Construction, LLC, and Renitta
Knight, a/k/a Renitta Lundy. Simpler requests that judgment be
entered in its favor in the amount of $57,287.08 (($144,875.10 +
$5000.00) - $69,004.89 = $80,870.21 - $23,583.12 = $57,297.08).
The Defendants have not addressed whether Simpler's $57,287.08
figure is accurate; they simply contend that, under Florida
Statute Sec. 489.128, they owe Simpler nothing.
Judge Stafford directed the clerk of court to enter judgment
stating: "Judgment is entered in favor of Simpler Solar Systems,
Inc., in the amount of $57,287.08, plus prejudgment interest at
the applicable statutory rate of ________ from November 1, 2011."
Simpler Solar sued Renitta Knight Construction, LLC, and Renitta
Knight for breach of contract. The case began as an adversary
action filed in the United States Bankruptcy Court for the
Northern District of Florida on Dec. 9, 2011. Simpler seeks
payment for work it performed pursuant to the parties' sub-
subcontract requiring Simpler to install a solar system for the
project known as the Tallahassee Regional Airport Water Intrusion
Project.
The case is SIMPLER SOLAR SYSTEMS, INC., Plaintiff, v. RENITTA
KNIGHT CONSTRUCTION, LLC, RENITTA KNIGHT, a/k/a/RENITTA LUNDY,
Defendants, 4:12cv468-WS (N.D. Fla.). A copy of the Court's
Dec. 2, 2013 Order is available at http://is.gd/g9gGUJfrom
Leagle.com.
Simpler Solar Systems, Inc., filed for Chapter 11 bankruptcy
(Bankr. N.D. Fla. Case No. 11-40909) on Nov. 10, 2011, listing
under $1 million in both assets and debts. A copy of the petition
is available at http://bankrupt.com/misc/flnb11-40909.pdf It is
represented by Robert C. Bruner, Esq. -- RobertCBruner@hotmail.com
Bankruptcy Judge Lewis M. Killian, Jr., oversees the case.
SIMPLY WHEELZ: Bankruptcy Casts Doubt on Hertz Antitrust Fix
------------------------------------------------------------
Brent Kendall and Jacqueline Palank, writing for Daily Bankruptcy
Review, reported that when Hertz Global Holdings Inc. acquired
car-rental rival Dollar Thrifty last year, the Federal Trade
Commission sought to combat rising prices by forcing Hertz to sell
off its Advantage Rent a Car brand, making it a new, independent
competitor. But the arrangement has taken a sharp detour.
Advantage filed for bankruptcy protection just months after a
final government settlement allowing the merger.
About Simply Wheelz LLC
Simply Wheelz LLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Miss. Case No. 13-03332) on Nov. 5,
2013. The case is assigned to Judge Edward Ellingon. The Debtor
estimated assets and debt in excess of $100 million.
The Debtors are represented by Christopher R. Maddux, Esq., and
Stephen W. Rosenblatt, Esq., at Butler Snow O'Mara Stevens &
Cannada, in Ridgeland, Mississippi.
STELERA WIRELESS: Okayed to Sell FCC Licenses to AT&T for $6MM
--------------------------------------------------------------
The Hon. Niles Jackson of the U.S. Bankruptcy Court for the
Western District of Oklahoma authorized Stelera Wireless, LLC to
sell its Federal Communications Commission licenses to:
-- AT&T Mobility Spectrum LLC, as purchaser; and
-- Atlantic Tele-Network, Inc., as backup purchaser.
In an auction held Nov. 20, 2013, AT&T's bid was the highest and
best offer for the FCC licenses, while Atlantic's, the stalking
horse purchaser, was the second highest.
Pursuant to the APA, the aggregate purchase price to be paid by
AT&T will be $6,020,000.
A copy of the APA is available for free at:
http://bankrupt.com/misc/STELERAWIRELESSfcclicensesaleorder.pdf
About Stelera Wireless, LLC
Stelera Wireless, LLC, filed a Chapter 11 petition (Bankr. W.D.
Okla. Case No. 13-13267) on July 18, 2013. Tim Duffy signed the
petition as chief technology officer/manager. Judge Niles L.
Jackson presides over the case. The Debtor disclosed $18,005,000
in assets and $30,809,314 in liabilities as of the Chapter 11
filing.
Christensen Law Group, PLLC, serves as the Debtor's primary
counsel. Mulinix Ogden Hall & Ludlam, PLLC, serves as additional
bankruptcy counsel. American Legal Claims Services, LLC serves as
official noticing agent.
The official committee of unsecured creditors is represented by
attorneys at Gablegotwals.
SUNRISE REAL ESTATE: Incurs $966,000 Net Loss in Third Quarter
--------------------------------------------------------------
Sunrise Real Estate Group, Inc., filed with the U.S. Securities
and Exchange Commission its quarterly report on Form 10-Q
disclosing a net loss of $966,428 on $2.67 million of net revenues
for the three months ended Sept. 30, 2013, as compared with a net
loss of $893,670 on $1.87 million of net revenues for the same
period during the prior year.
For the nine months ended Sept. 30, 2013, the Company incurred a
net loss of $1.02 million on $9.27 million of net revenues as
compared with a net loss of $3.10 million on $5.43 million of net
revenues for the same period a year ago.
The Company's balance sheet at Sept. 30, 2013, showed $60.33
million in total assets, $55.82 million in total liabilities and
$4.50 million in total shareholders' equity.
"As of September 30, 2013, the Company has a working capital
deficiency, accumulated deficit from recurring net losses, and
significant short-term debt obligations currently in default or
maturing in less than one year. These factors raise substantial
doubts about the Company's ability to continue as a going
concern," the Company said in the quarterly report for the period
ended Sept. 30, 2013.
A copy of the Form 10-Q is available for free at:
http://is.gd/6Hfj4o
About Sunrise Real Estate
Headquartered in Shanghai, the People's Republic of China, Sunrise
Real Estate Group, Inc. was initially incorporated in Texas on
Oct. 10, 1996, under the name of Parallax Entertainment, Inc.
On Dec. 12, 2003, Parallax changed its name to Sunrise Real
Estate Development Group, Inc. On April 25, 2006, Sunrise Estate
Development Group, Inc., filed Articles of Amendment with the
Texas Secretary of State, changing the name of Sunrise Real Estate
Development Group, Inc. to Sunrise Real Estate Group, Inc.,
effective from May 23, 2006.
The Company and its subsidiaries are engaged in the property
brokerage services, real estate marketing services, property
leasing services and property management services in China.
Sunrise Real Estate incurred a net loss of US$3.47 million on
US$8.52 million of net revenues for the year ended Dec. 31, 2012,
as compared with a net loss of US$1.15 million on US$8.97 million
of net revenues for the year ended Dec. 31, 2011.
Finesse CPA, P.C., in Chicago, Illinois, issued a "going concern"
qualification on the consolidated financial statements for the
year ended Dec. 31, 2012. The independent auditors noted that
the Company has a working capital deficiency, accumulated deficit
from recurring net losses for the current and prior years, and
significant short-term debt obligations currently in default or
maturing in less than one year. These conditions raise
substantial doubt about the Company's ability to continue as a
going concern.
THERAKOS INC: S&P Affirms 'B' CCR Over Increased Term Loan
----------------------------------------------------------
Standard & Poor's Ratings Services said it affirmed its 'B'
corporate credit rating on West Chester, Pa.-based Therakos Inc.
The outlook is stable. At the same time, S&P affirmed its 'B'
issue-level rating and '3' recovery rating on the company's
$275 million of first-lien debt, which includes an undrawn
$35 million revolving credit facility, and 'CCC+' issue level
rating and '6' recovery rating on the $105 million of second-lien
debt.
"Our rating on Therakos reflects a "weak" business profile and
"highly leveraged" financial risk profile. Our business risk
assessment incorporates the risks of Therakos' small size, limited
addressable market, and heavy reliance on one therapy--
extracorporeal electrophoresis (ECP)--for all of its revenues,"
said credit analyst Cheryl Richer. "These weaknesses are only
partially offset by the company's leading position within its
niche market, strong geographic and customer diversity, sturdy
barriers to entry, and competitive advantage arising from the
strong safety and efficacy profile of Therakos' ECP therapy.
Founded in 1986, Therakos was carved out of Orthoclinical
Diagnostic, a division of Johnson & Johnson, in late 2012 as an
independent operation owned by The Gores Group."
S&P's stable rating outlook on Therakos reflects its expectation
that modest revenue growth and some EBITDA margin erosion will
result in debt to EBITDA above 5.0x over the next 12 months.
Downside Scenario
S&P could lower the rating in the unlikely event that revenue
decline and margin contraction are high enough to result in
negative free cash flow, which could constrain liquidity. This
would require a double-digit revenue decline and an EBITDA margin
contraction of at least 600 bps. Such a scenario could follow a
launch of a competitive product, and/or substantially higher-than-
expected clinical trial expenses.
Upside scenario
While unlikely, S&P could raise its corporate credit rating on
Therakos if it sustains a debt-to-EBITDA ratio of about 4.5x and
FFO-to-debt ratio above 12%. S&P estimates this would require
double-digit revenue growth and an EBITDA margin expansion of
300 bps from its 2014 base case projections. S&P's belief that
the financial sponsor is committed to such a financial policy
would be a prerequisite for an upgrade, and, given recent dividend
recapitalization, S&P views this scenario as unlikely.
TITAN PHARMACEUTICALS: Braeburn Held 11% Equity Stake at Nov. 25
----------------------------------------------------------------
In an amended Schedule 13D filed with the U.S. Securities and
Exchange Commission, Braeburn Pharmaceuticals BVBA SPRL and its
affiliates disclosed that as of Nov. 25, 2013, they beneficially
owned 9,650,000 shares of common stock of Titan Pharmaceuticals,
Inc., representing 11.7 percent of the shares outstanding. A copy
of the regulatory filing is available at http://is.gd/bNurTY
About Titan Pharmaceuticals
South San Francisco, California-based Titan Pharmaceuticals is a
biopharmaceutical company developing proprietary therapeutics
primarily for the treatment of central nervous system disorders.
Titan Pharmaceuticals incurred a net loss applicable to common
stockholders of $15.18 million in 2012, as compared with a net
loss applicable to common stockholders of $15.20 million in 2011.
As of Sept. 30, 2013, the Company had $15.52 million in total
assets, $14.49 million in total liabilities and $1.02 million in
total stockholders' equity.
TRANS-LUX CORP: Obtains $1 Million Financing From Carlisle
----------------------------------------------------------
Trans-Lux Corporation executed a promissory note in favor of
Carlisle Investments, Inc., pursuant to which Carlisle will loan
$1,000,000 to the Company in order to provide the Company with
temporary financing. Mr. Marco Elser, a director of the Company,
exercises voting and dispositive power as investment manager of
Carlisle.
In connection with the Loan, the Company has granted to Carlisle a
first-priority (excluding the liens held by the Pension Benefit
Guaranty Corporation, which are senior to the liens and security
interest granted in connection with the Loan) continuing security
interest in and lien upon all assets of the Company (excluding
those assets subject to the security interest granted to Axis
Capital, Inc., by the Company pursuant to that certain Master
Agreement for Sale and Assignment of Leases dated as of June 6,
2013), in accordance with the terms of a security agreement
entered into between the parties and dated as of Dec. 2, 2013.
The Note bears interest at the rate of ten percent per annum and
has a maturity date of June 1, 2014, with a bullet payment of all
principal and accrued interest due at such time; provided,
however, that the parties may agree in writing to convert or
exchange all or any part of the Note into a long term investment
by Carlisle in Trans-Lux. In the event the parties engage in a
Conversion Transaction, all amounts due under the Note will be
payable in accordance with the terms of the documentation executed
by the parties in connection with such Conversion Transaction, if
any. On Dec. 4, 2013, net proceeds in the amount of $1,000,000
were received from Carlisle. The funds were used for working
capital purposes.
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. The Company's balance sheet at
June 30, 2013, showed $19.69 million in total assets, $18.83
million in total liabilities and $859,000 in total stockholders'
equity.
"Management cannot provide any assurance that the Company would
have sufficient cash and liquid assets to fund normal operations.
Further, the Company's obligations under its pension plan exceeded
plan assets by $6.5 million at June 30, 2013 and the Company has
$1.7 million due under its pension plan over the next 12 months.
Additionally, if the Company is unable to cure the defaults on the
Debentures and the Notes, the Debentures and the Notes could be
called and be immediately due. If the Debentures and Notes are
called, the Company would need to obtain new financing. There can
be no assurance that the Company will be able to do so and, even
if it obtains such financing, how the terms of such financing will
affect the Company. If the debt is called and new financing
cannot be arranged, it is unlikely that the Company will be able
to continue as a going concern," according to the Company's
quarterly report for the period ended June 30, 2013.
TRANSGENOMIC INC: Austin Marxe Held 1.9% Equity Stake at Nov. 29
----------------------------------------------------------------
In an amended Schedule 13G filed with the U.S. Securities and
Exchange Commission, Austin W. Marxe and David M. Greenhouse
disclosed that as of Nov. 29, 2013, they beneficially owned
1,750,000 shares of common stock of Transgenomic, Inc.,
representing 1.9 percent of the shares outstanding. The reporting
persons previously reported beneficial ownership of 2,529,300
common shares or 5.6 percent equity stake as of Dec. 31, 2012.
A copy of the regulatory filing is available for free at:
http://is.gd/AfFWrk
About Transgenomic
Transgenomic, Inc. -- http://www.transgenomic.com/-- is a global
biotechnology company advancing personalized medicine in
cardiology, oncology, and inherited diseases through its
proprietary molecular technologies and world-class clinical and
research services. The Company is a global leader in cardiac
genetic testing with a family of innovative products, including
its C-GAAP test, designed to detect gene mutations which indicate
cardiac disorders, or which can lead to serious adverse events.
Transgenomic has three complementary business divisions:
Transgenomic Clinical Laboratories, which specializes in molecular
diagnostics for cardiology, oncology, neurology, and mitochondrial
disorders; Transgenomic Pharmacogenomic Services, a contract
research laboratory that specializes in supporting all phases of
pre-clinical and clinical trials for oncology drugs in
development; and Transgenomic Diagnostic Tools, which produces
equipment, reagents, and other consumables that empower clinical
and research applications in molecular testing and cytogenetics.
Transgenomic believes there is significant opportunity for
continued growth across all three businesses by leveraging their
synergistic capabilities, technologies, and expertise. The
Company actively develops and acquires new technology and other
intellectual property that strengthens its leadership in
personalized medicine.
Transgenomic incurred a net loss of $8.32 million in 2012, a net
loss of $9.78 million in 2011 and a net loss of $3.13 million in
2010. The Company's balance sheet at Sept. 30, 2013, showed
$33.18 million in total assets, $17.78 million in total
liabilities and $15.39 million in total stockholders' equity.
Forbearance Agreement
On Feb. 7, 2013, the Company entered into a Forbearance Agreement
with Dogwood Pharmaceuticals, Inc., a wholly owned subsidiary of
Forest Laboratories, Inc., and successor-in-interest to PGxHealth,
LLC, with an effective date of Dec. 31, 2012. In December 2012,
the Company commenced discussions with the Lender to defer the
payment due on Dec. 31, 2012, until March 31, 2013. As of
Dec. 31, 2012, an aggregate of $1.4 million was due and payable
under the Note by Transgenomic, and non-payment would constitute
an event of default under the Note and that certain Security
Agreement, dated as of Dec. 29, 2010, entered into between
Transgenomic and PGX. Pursuant to the Forbearance Agreement, the
Lender agreed, among other things, to forbear from exercising its
rights and remedies under the Note and the Security Agreement as a
TRIGEANT LTD: BTB Wants to Proceed with 5th Circuit Appeal
----------------------------------------------------------
BTB Refining, LLC, seeks relief from the automatic stay in the
Chapter 11 of Trigeant, Ltd., to allow it to proceed with an
appeal currently pending as BTB Refining, LLC v. PDVSA Petroleo,
S.A., Case No. 13-40062 in the U.S. Court of Appeals for the Fifth
Circuit that includes Trigeant as a named appellee.
The Appeal involves an issue of law that, according to BTB, will
be dispositive of the Debtor's bankruptcy case -- whether the
Debtor owns an asphalt production facility in Corpus Christi,
Texas, that refines crude oil.
The issue on appeal is whether the U.S. District Court for the
Southern District of Texas properly held that BTB's March 2008
foreclosure of the refining plant constituted a "fraudulent
transfer" under the Texas Uniform Fraudulent Transfer Act.
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reported that the primary contending parties are Petroleos de
Venezuela SA, owed $52.8 million according to a filing in the
bankruptcy court, and BTB, a secured lender that may have
successfully foreclosed a $22.6 million mortgage on the Texas
refinery.
Charles W. Throckmorton, Esq. -- cwt@kttlaw.com -- at Kozyak
Tropin & Throckmorton, P.A., in Coral Gables, Florida; and Deirdre
B. Ruckman, Esq. -- druckman@gardere.com -- at Gardere Wynne
Sewell LLP, in Dallas, Texas, represents BTB in Trigeate's Chapter
11 case before the U.S. Bankruptcy Court for the Southern District
of Florida, West Palm Division.
The Chapter 11 case is In re Trigeant Ltd., 13-bk-38580, U.S.
Bankruptcy Court, Southern District of Florida (West Palm Beach).
The Debtor is represented by Paul Steven Singerman, Esq., at
BERGER SINGERMAN LLP, in Miami, Florida.
TRIGEANT LTD: Reorganization is New Chapter in Old Family Feud
--------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the reorganization of Trigeant Ltd., the owner of an
asphalt plant in Corpus Christi, Texas, is a family feud being
played out in U.S. Bankruptcy Court in West Palm Beach, Florida,
the U.S. Court of Appeals in New Orleans, and several other
courts.
According to the report, on one side are Harry Sargeant Jr. and
his sons Dan and Jim. On the other is son Harry III. The father
and sons are involved in five separate lawsuits, according to a
court filing by Trigeant.
In the middle is Petroleos de Venezuela SA, owed $52.8 million
according to a Trigeant filing in bankruptcy court.
As told by the father, son Harry was Trigeant's manager until he
was removed in February. The father alleges his son bought crude
from PDVSA, diverting proceeds to himself and leaving the supplier
unpaid, leading to judgments against the plant.
The Court of Appeals comes into play because that's the court to
decide about upholding a judgment from federal district court in
Houston.
The district court ruled that Harry III's company BTB Refining LLC
carried out a fraudulent transfer by foreclosing a $22.6 million
mortgage on the refinery. Caracas-based PDVSA won the fraudulent
transfer judgment.
The ruling, now on appeal, calls for retransferring ownership of
the refinery from BTB to Trigeant. In the process, PDVSA's $40
million judgment would be reinstated as a lien on the plant.
In papers filed last week, Trigeant contends BTV violated the so-
called automatic stay by removing property from the plant,
rendering it inoperable. There will be a hearing on Dec. 18 in
bankruptcy court to compel replacement of the equipment.
"BTB categorically denies any stay violations," said Deirdre
Ruckman, a lawyer for BTB from Gardere Wynne Sewell LLP in Dallas.
At a Dec. 5 hearing, "BTB agreed to cooperate in certain
transition issues, and the court did not grant any of the
emergency relief requested by the debtor," Ruckman said in an
interview.
Meanwhile, Corpus Christi-based BTB hasn't been standing still. It
already has papers on file in bankruptcy court to allow the appeal
to go forward in the circuit court and thus decide who owns the
asphalt plant.
Trigeant has arranged for $1 million in financing from the father.
About Trigeant Ltd.
Trigeant, Ltd., filed a Chapter 11 bankruptcy petition (Bankr.
S.D. Fla. Case No. 13-38580) in West Palm Beach, Florida, on
Nov. 27, 2013. The Boca Raton, Florida-based owner of a refinery
estimated $10 million to $50 million in assets, and $50 million to
$100 million in liabilities. Paul Steven Singerman, Esq., at
Berger Singerman, in Miami, serves as counsel to the Debtor.
Judge Hon. Erik P. Kimball presides over the case.
TRIUMPH GROUP: S&P Hikes CCR to BB+ on Revised Criteria, Off Watch
------------------------------------------------------------------
Standard & Poor's Ratings Services said that it raised its
corporate credit rating on Berwyn, Pa.-based Triumph Group Inc. to
'BB+' from 'BB'. At the same time, S&P removed the rating from
CreditWatch, where it placed it with positive implications on
Nov. 26, 2013. The outlook is stable. S&P also revised its
recovery rating on the company's unsecured debt to '6' from '5',
which indicates its expectation of negligible (0%-10%) recovery in
the event of payment default, and affirmed the 'BB-' issue rating.
"The upgrade reflects our reassessment of Triumph's competitive
position, which is a component of its business risk profile, and
its cash flow adequacy and leverage, which determine its financial
risk profile," said Standard & Poor's credit analyst Christopher
Denicolo. Triumph is a leading manufacturer of structures for
commercial, military, and business aircraft, supplies various
aerostructures, and mechanical and electromechanical control
systems to Boeing Co. and Airbus SAS. The company's long-term
contracts with those manufacturers help cushion earnings and cash
flow through cyclical fluctuations of commercial aerospace
production. Triumph's five-year weighted average core credit
ratios, as measured by debt to EBITDA and funds from operations
(FFO) to debt, fall into S&P's "intermediate" range, which is a
key consideration in its "intermediate" financial risk profile.
These positives are partly offset by a continued potential for
midsize or large acquisitions that could cause leverage to
increase to levels higher than assumed in S&P's base-case
scenario. The outlook is stable. A strong commercial aerospace
market, contributions from recent acquisitions, and new program
wins should result in solid revenue and earnings growth for the
next few years despite weakness in the military sector. S&P
expects the company to continue to use excess cash flows to make
debt reduction, voluntary pension contributions, and pursue small
to midsize acquisitions.
S&P could consider an upgrade if adjusted debt to EBITDA declines
to less than 2x and adjusted FFO to debt improves to more than
40%. This could happen if the company commits more cash to debt
reduction, expected cost savings are higher than anticipated, or
earnings from new programs, such as the Bombardier 7000/8000 Wing
and 767 tanker are better than expected.
S&P could lower the rating if weaker-than-expected commercial
aerospace conditions, operational issues relating to the facility
relocation, additional program cost overruns, higher debt to fund
acquisitions, or delays on new programs result in adjusted debt to
EBITDA increasing to more than 3.5x and adjusted FFO to debt
declining below 25%.
TWIN DEVELOPMENTS: Chapter 11 Reorganization Case Dismissed
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of California
dismissed the Chapter 11 case of Twin Developments, LLC.
The Court directed the Debtor to pay all outstanding quarterly
fees to the U.S. Trustee.
Wallace Benwart, the Debtor's manager and the Debtor's counsel
James Andrew Hinds, Jr., Esq., at Law Offices Of James Andrew
Hinds, Jr., have said case dismissal would be the best avenue to
pursue, as it would allow the Debtor to continue to pursue causes
of action against La Jolla Bank and continue to initiate the
recovery of certain bond deposits and securities from the San
Diego County and Rainbow Municipal Water District, well as pursue
recovery of other assets of the estate.
The Debtor's counsel reminded the Debtor's manager that the U.S.
Trustee's quarterly fees for all four quarters of 2013 in the sum
of $1,300 are still outstanding.
Twin Development, LLC, filed a Chapter 11 petition (Bankr. S.D.
Cal. Case No. 13-02719) on March 19, 2013. The petition was
signed by Wallace Benwart as manager. The Debtor scheduled assets
of $55,800,000 and liabilities of $38,027,600.
VAIL LAKE: Court Approves Stipulation on Cash Collateral Use
------------------------------------------------------------
In an amended order dated Nov. 25, 2013, the Bankruptcy Court
approved a stipulation authorizing Vail Lake Rancho California,
LLC, et al., to use cash collateral and granting adequate
protection. No opposition to the Stipulation has been filed.
A copy of the Order is available for free at:
http://bankrupt.com/misc/VAILLAKEcashcollorder.pdf
Vail Lake Rancho California, LLC, and its affiliates own the
California campground Vail Lake Resort. Vail Lake is a large
reservoir in western Riverside County, California, located on
Temecula Creek in the Santa Margarita River watershed,
approximately 15 miles east of Temecula, California. Properties
cover approximately 9,000 acres and have an estimated water
storage capacity of approximately 51,000 acre-feet.
On Dec. 26, 2012, creditors of Vail Lake filed an involuntary
Chapter 11 petition (Bankr. S.D. Cal. Case No. 12-16684) for Vail
Lake. In a filing on June 6, 2013, the Debtor said it consents to
the entry of an order for relief and does not contest the
involuntary Chapter 11 petition.
On June 5, 2013, the company sent 5 related entities -- Vail Lake
USA, LLC ("VLU"), Vail Lake Village & Resort, LLC ("VLRC"), Vail
Lake Groves, LLC, Agua Tibia Ranch, LLC, and Outdoor Recreational
Management, LLC -- to Chapter 11 bankruptcy.
The new debtors have sought and obtained an order for joint
administration of their Chapter 11 cases with Vail Lake Rancho
(Case No. 12-16684).
The Debtors are represented by attorneys at Cooley LLP and
Phillips, Haskett & Ingwalson, A.P.C. The Debtor also employed
Thomas C. Hebrank and E3 Realty Advisors, Inc., with Mr. Hebrank
serving as the Debtors' chief restructuring officer.
The Debtors' consolidated assets, as of May 31, 2013, total
approximately $291,016,000 and liabilities total $52,796,846.
VALEANT PHARMACEUTICALS: S&P Rates Proposed $3.17-Bil. Loan 'BB'
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB' issue-level
ratings to Laval, Quebec-based pharmaceutical company Valeant
Pharmaceuticals International Inc.'s proposed $3,176 million
senior secured term loan B series E, $1,695 million secured term
loan A-1, and $765 million secured term loan A-2. S&P assigned a
recovery ratings of '2' to these loans, reflecting its expectation
for substantial (70%-90%) recovery on these obligations in the
event of a payment default.
The company is issuing these obligations as part of a leverage-
neutral refinancing transaction. The proposed term loan B
(series E) matures on Aug. 5, 2020, and is substantially unchanged
except for the lower expected interest rate. S&P expects the
maturity on all or a portion of the proposed term loan A-1 and A-2
to be changed to Oct. 20, 2018, and for the amortization schedule
to be reset.
"Our 'BB-' corporate credit rating on Valeant reflects our view
that the company's financial risk profile is "highly leveraged"
and business risk profile is "satisfactory". The highly leveraged
financial risk profile reflects leverage of about 5.7x (excluding
synergies) including our adjustments, following the recent
acquisition of Bausch & Lomb, as well as our expectation for the
company to continue pursuing rapid acquisition-based growth. The
satisfactory business risk profile reflects the profitability,
scale, and diversification of Valeant's businesses," S&P said.
RATING LIST
Valeant Pharmaceuticals International Inc.
Corporate Credit Rating BB-/Stable/--
New Rating
Valeant Pharmaceuticals International Inc.
$3,176M senior secured term loan B BB
series E
Recovery Rating 2
$1,695M secured term loan A-1 BB
Recovery Rating 2
$765M secured term loan A-2 BB
Recovery Rating 2
VERITEQ CORP: PositiveID Holds 3% Equity Stake
----------------------------------------------
In an amended Schedule 13G filed with the U.S. Securities and
Exchange Commission, PositiveID Corporation disclosed that as of
Nov. 13, 2013, it beneficially owned 300,000 shares of common
stock of VeriTeQ Corporation representing 3 percent of the shares
outstanding. A copy of the regulatory filing is available for
free at http://is.gd/nOnNF4
About VeriteQ
VeriTeQ, formerly known as Digital Angel Corporation, is a
developer and marketer of innovative RFID technologies for
implantable medical device identification and radiation dosimeters
for use in cancer treatment.
The Company's balance sheet at Sept. 30, 2013, showed $7.72
million in total assets, $13 million in total liabilities and a
$5.27 million total stockholders' deficit.
"We are in the development stage, have incurred operating losses
since our inception and we have a working capital deficit of
approximately $2.7 million as of September 30, 2013. These
factors raise substantial doubt about our ability to continue as a
going concern," the Company said in its quarterly report for the
period ended Sept. 30, 2013.
VIGGLE INC: Robert Sillerman Held 83.7% Equity Stake at Nov. 25
---------------------------------------------------------------
In an amended Schedule 13D filed with the U.S. Securities and
Exchange Commission, Robert F.X. Sillerman disclosed that as of
Nov. 25, 2013, he beneficially owned 112,606,913 shares of
common stock of Viggle Inc. representing 83.7 percent of the
shares outstanding. Mr. Sillerman previously reported beneficial
ownership of 111,561,913 common shares or 82.9 percent equity
stake as of Oct. 25, 2013. A copy of the regulatory filing is
available for free at http://is.gd/kc8vdA
About Viggle
New York City-based Viggle Inc. is a loyalty marketing company.
The Company has developed a loyalty program for television that
gives people real rewards for checking into the television shows
they are watching on most mobile operating system. Viggle users
can redeem their points in the app's rewards catalog for items
such as movie tickets, music, or gift cards.
Viggle incurred a net loss of $91.40 million on $13.90 million of
revenues for the year ended June 30, 2013, as compared with a net
loss of $96.51 million on $1.73 million of revenues during the
prior year. The Company's balance sheet at Sept. 30, 2013, showed
$16.06 million in total assets, $36.26 million in total
liabilities, $36.83 million in series A convertible redeemable
preferred stock, and a $57.04 million total stockholders' deficit.
BDO USA, LLP, in New York, issued a "going concern" qualification
on the consolidated financial statements for the year ended
June 30, 2013. The independent auditors noted that the Company
has suffered recurring losses from operations and at June 30,
2013, has deficiencies in working capital and equity that raise
substantial doubt about its ability to continue as a going
concern.
VITESSE SEMICONDUCTOR: To Offer $75 Million Worth of Securities
---------------------------------------------------------------
Vitesse Semiconductor Corporation filed with the U.S. Securities
and Exchange Commission a Form S-3 registration statement relating
to its plan to offer up to $75 million of any combination of
common stock, preferred stock, warrants, units, and debt
securities.
The Company said it will provide the specific terms of these
offerings and securities in one or more supplements to this
prospectus.
The Company's common stock is traded on The Nasdaq Global Market
under the symbol "VTSS." On Dec. 5, 2013, the last reported sale
price of the Company's common stock on The Nasdaq Global Market
was $2.79.
A copy of the Form S-3 prospectus is available for free at:
http://is.gd/AamFco
About Vitesse
Based in Camarillo, California, Vitesse Semiconductor Corporation
(Pink Sheets: VTSS.PK) -- http://www.vitesse.com/-- designs,
develops and markets a diverse portfolio of semiconductor
solutions for Carrier and Enterprise networks worldwide.
In October 2009, Vitesse completed a debt restructuring
transaction that resulted in the conversion of 96.7 percent of the
Company's 2024 Debentures into a combination of cash, common
stock, Series B Preferred Stock and 2014 Debentures. With respect
to the remaining 3.3 percent of the 2024 Debentures, Vitesse
settled its obligations in cash. Additionally, Vitesse repaid $5
million of its $30 million Senior Term Loan, the terms of which
were amended as part of the debt restructuring transactions.
Vitesse incurred a net loss of $1.11 million in 2012, a net loss
of $14.81 million in 2011, and a net loss of $20.05 million in
2010. As of June 30, 2013, the Company had $104.55 million in
total assets, $84.77 million in total liabilities and $19.78
million in total stockholders' equity.
VITESSE SEMICONDUCTOR: Incurs $22.1-Mil. Net Loss in Fiscal 2013
----------------------------------------------------------------
Vitesse Semiconductor Corporation filed with the U.S. Securities
and Exchange Commission its annual report on Form 10-K disclosing
a net loss of $22.07 million on $103.77 million of net revenues
for the year ended Sept. 30, 2013, as compared with a net loss of
$1.11 million on $119.48 million of net revenues for the year
ended Sept. 30, 2012. The Company reported a net loss of $14.81
million for the year ended Sept. 30, 2011.
Vitesse reported a net loss of $5.76 million on $26.87 million of
net revenues for the three months ended Sept. 30, 2013, as
compared with net income of $1.21 million on $29.46 million of net
revenues for the same period a year ago.
As of Sept. 30, 2013, the Company had $98.96 million in total
assets, $83.05 million in total liabilities and $15.90 million in
total stockholders' equity.
"During the year, we executed our new product strategy and
continued converting design wins to meaningful revenue," said
Chris Gardner, CEO of Vitesse. "Fiscal 2013 new product revenue
grew 82% year-over-year, reaching 33% of revenue. More
importantly, we continue to build for the future. 2013 new
product design wins grew 40%, strengthening Vitesse's foundation
for continued new product growth in 2014 and beyond."
"Through ongoing R&D investment, we have developed patented
technology advantages that solve the critical needs of our
customers: service delivery, synchronization, security, and signal
integrity. As a result, Vitesse is emerging as the de facto
provider of Ethernet-based ICs for 4G/LTE Mobile and Cloud Access
for Carrier and Enterprise networks. Our plan is to also expand
into adjacent markets such as the Internet of Things. With this
momentum, new product revenue is expected to ramp to $55 million
in 2014. Vitesse is poised to achieve sustainable profitability."
A copy of the Form 10-K is available for free at:
http://is.gd/dNx7Wf
About Vitesse
Based in Camarillo, California, Vitesse Semiconductor Corporation
(Pink Sheets: VTSS.PK) -- http://www.vitesse.com/-- designs,
develops and markets a diverse portfolio of semiconductor
solutions for Carrier and Enterprise networks worldwide.
In October 2009, Vitesse completed a debt restructuring
transaction that resulted in the conversion of 96.7 percent of the
Company's 2024 Debentures into a combination of cash, common
stock, Series B Preferred Stock and 2014 Debentures. With respect
to the remaining 3.3 percent of the 2024 Debentures, Vitesse
settled its obligations in cash. Additionally, Vitesse repaid $5
million of its $30 million Senior Term Loan, the terms of which
were amended as part of the debt restructuring transactions.
VERITEQ CORP: Hudson Bay, et al., to Sell 6.3MM Common Shares
-------------------------------------------------------------
Veriteq Corporation filed a Form S-1 prospectus with the U.S.
Securities and Exchange Commission relating to the resale by
Hudson Bay Master Fund Ltd., Melechdavid Inc., Alpha Capital
Ansalt, et al., of up to an aggregate of 6,333,335 shares of the
Company's common stock, par value $0.01 per share. The Company
will not receive any of the proceeds from the sale of the common
stock by the selling security holders.
Under the registration rights agreement entered into by the
Company and the selling security holders in connection with the
issuance of the senior secured convertible notes, due Nov. 13,
2014, and the warrants issued in conjunction therewith, the
Company is required to register for resale 125 percent of the
number of shares of the Company's common stock issuable pursuant
to the Notes and 125 percent of the number of shares of the
Company's common stock issuable pursuant to the Warrants.
The Company has agreed to pay certain expenses in connection with
the registration of the shares. The selling security holders will
pay all underwriting discounts and selling commissions, if any, in
connection with the sale of the shares.
The Company's common stock is quoted on the OTC Markets, under the
ticker symbol "VTEQ." On Dec. 3, 2013, the closing price of the
Company's common stock was $2.30 per share.
A copy of the Form S-1 is available for free at:
http://is.gd/28DM8p
About VeriteQ
VeriTeQ, formerly known as Digital Angel Corporation, is a
developer and marketer of innovative RFID technologies for
implantable medical device identification and radiation dosimeters
for use in cancer treatment.
The Company's balance sheet at Sept. 30, 2013, showed $7.72
million in total assets, $13 million in total liabilities and a
$5.27 million total stockholders' deficit.
"We are in the development stage, have incurred operating losses
since our inception and we have a working capital deficit of
approximately $2.7 million as of September 30, 2013. These
factors raise substantial doubt about our ability to continue as a
going concern," the Company said in its quarterly report for the
period ended Sept. 30, 2013.
WALKER LAND: Hearing Tomorrow on Bid to Use Cash Collateral
-----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Idaho, in an amended
notice, will convene a hearing Dec. 11, 2013, at 10:00 a.m., to
consider Walker Land & Cattle, LLC's motion to use cash collateral
and authority to endorse checks.
The Debtor has filed a cash collateral budget, a copy of which is
available for free at:
http://bankrupt.com/misc/WALKERLANDcashcollbudget.pdf
Larry E. Prince, Esq., at HOLLAND & HART LLP, on behalf of
creditor Wells Fargo Bank, National Association, objected to the
interim use of cash collateral, stating that the Debtor's budget
lacks sufficient detail to support a finding of immediate and
irreparable harm. It includes broad categories of expenses but
does not state the assumptions upon which it is based.
Wells Fargo holds a first priority lien in, among other things,
the Debtor's 2013 crops, its accounts, general intangibles, a
portion of its equipment, and the proceeds of the foregoing.
Wells Fargo also holds a second priority lien on most, if not all,
of the Debtor's real estate. The Debtor is indebted to Wells
Fargo in the amount of approximately $21,000,000 pursuant to
promissory notes executed by the Debtor in favor of Wells Fargo.
In a separate filing, Jacob Ward Hancock objected to the payment
of wages to the owners of Walker Land and cattle.
As reported in the Troubled Company Reporter on Nov 26, 2013, the
Debtor sought authorization to use cash collateral to pay its
general operating expenses from Nov. 15, 2013, to Dec. 18, 2013.
Without permission to use cash collateral pending presentation and
confirmation of a Chapter 11 plan of reorganization, the Debtor
will be unable to reorganize.
As adequate protection, the Debtor is willing to give adequate
protection by granting a revolving postpetition adequate
protection lien in postpetition receivables, to the same extent,
value and priority as existed as of the Petition Date, to the
extent of cash collateral actually used, and to the extent that
the respective real properties do not have a sufficient equity
cushion to adequately protect the prepetition secured creditors.
About Walker Land & Cattle, LLC
Walker Land & Cattle, LLC, sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. D. Idaho Case No. 13-41437) on
Nov. 15, 2013. The case is assigned to Judge Jim D. Pappas.
The Debtor estimated assets and liabilities ranging from $50
million to $100 million. The petition was signed by Roland N.
(Rollie) Walker, manager.
The Debtor's counsel is Robert J Maynes, Esq., at Maynes taggart,
PLLC, in Idaho Falls, Idaho.
WALTER INVESTMENT: Moody's Rates $500MM Sr. Unsecured Notes 'B3'
----------------------------------------------------------------
Moody's Investors Service assigned a B3 rating to Walter
Investment Management's proposed $500 million Senior Unsecured
Notes. Walter Investment's B2 Corporate Family Rating ("CFR") and
B2 Senior Secured Bank Credit Facility ratings were affirmed, and
the firm's rating outlook remains stable.
Ratings Rationale:
On December 3, 2013, Walter announced their intention to enter
into a new secured credit agreement of $1,625 million which will
include a $1,500 million term loan and a $125 million revolving
credit facility. In addition, the company also announced its
intention to issue $500 million of senior unsecured notes.
Walter Investment's B2 CFR is supported by its growing position in
the U.S. residential mortgage market, in particular its third
party servicing business, its consistent financial results and its
good track record of acquiring and integrating residential
mortgage servicers.
Credit concerns include Walter Investment's high financial
leverage (e.g. Debt to EBITDA) and low level of tangible equity
relative to its mortgage servicing peers, reliance on secured
funding which limits the company's financial flexibility, and the
company's rapid growth which poses operational integration risks.
In addition, while the company has recently expanded its
origination capacity, the ratings are constrained by the fact that
most new servicing volume is obtained through opportunistic bulk
acquisitions and that the company is a monoline financial services
company concentrating on the residential mortgage servicing
market.
The B2 senior secured bank facility rating and B3 rating of the
unsecured notes are based upon their terms and priority in Walter
Investment's capital profile. The unsecured notes are structurally
subordinated to the firm's secured indebtedness but senior to the
existing senior subordinated convertible notes.
The stable outlook at the current rating level reflects Moody's
expectation that Walter will be able to successfully integrate its
extraordinarily rapid growth while maintaining its solid servicing
performance along with reaping the financial benefits of its much
larger servicing portfolio.
The ratings could be upgraded if the company demonstrates
sustainable improvement in its financial performance such as
achieving a tangible common equity to total assets ratio of more
than 15%, a corporate debt (includes senior as well as
subordinated, secured as well as unsecured, and convertible debt)
to tangible common equity ratio of less than 1.5x, corporate debt
to company reported actual adjusted EBITDA (as defined in the
company's loan agreement) of less than 2.75x, and quarterly GAAP
income of more than $25 million; all while maintaining its solid
servicing performance and solid franchise value.
The ratings could be downgraded if the company's a) servicing
performance deteriorates, particularly if as a result the
company's franchise value weakens, or b) financial performance
materially deteriorates such as if the company's corporate debt-
to-equity ratio increases above 2.5x, corporate debt to company
reported actual adjusted EBITDA ratio increases above 4.0x,
quarterly GAAP income of less than $15 million.
Walter Investment, based in Tampa, Florida, is an asset manager,
mortgage portfolio owner and mortgage servicer specializing in
less-than-prime, non-conforming and other credit challenged
mortgage assets.
ZALE CORP: Files Form 10-Q; Incurs $27.3MM Net Loss in Q1 2014
--------------------------------------------------------------
Zale Corporation filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $27.30 million on $362.61 million of revenues for the three
months ended Oct. 31, 2013, as compared with a net loss of $28.26
million on $357.46 million of revenues for the same period a year
ago.
As of Oct. 31, 2013, Zale Corporation had $1.31 billion in total
assets, $1.16 billion in total liabilities and $152.95 million in
total stockholders' investment.
"Our cash requirements consist primarily of funding ongoing
operations, including inventory requirements, capital expenditures
for new stores, renovation of existing stores, upgrades to our
information technology systems and debt service. Our cash
requirements are funded through cash flows from operations and our
revolving credit agreement with a syndicate of lenders led by Bank
of America, N.A. We manage availability under the revolving
credit agreement by monitoring the timing of merchandise purchases
and vendor payments. At October 31, 2013, we had borrowing
availability under the revolving credit agreement of approximately
$231 million. The average vendor payment terms during the three
months ended October 31, 2013 and 2012 were approximately 48 days
and 53 days, respectively. As of October 31, 2013, we had cash
and cash equivalents totaling $13.9 million. We believe that our
operating cash flows and available credit facility are sufficient
to finance our cash requirements for at least the next twelve
months," the Company said in the Report.
A copy of the Form 10-Q is available for free at:
http://is.gd/r6LZ3Y
About Zale Corporation
Based in Dallas, Texas, Zale Corporation (NYSE: ZLC) --
http://www.zalecorp.com/-- is a specialty retailer of diamonds
and other jewelry products in North America, operating
approximately 1,695 retail locations throughout the United States,
Canada and Puerto Rico, as well as online. Zale Corporation's
brands include Zales Jewelers, Zales Outlet, Gordon's Jewelers,
Peoples Jewellers, Mappins Jewellers and Piercing Pagoda. Zale
also operates online at http://www.zales.com/,
http://www.zalesoutlet.com/,
http://www.gordonsjewelers.com/and http://www.pagoda.com/
Zale Corporation disclosed net earnings of $10.01 million on $1.88
billion of revenues for the year ended July 31, 2013, as compared
with a net loss of $27.31 million on $1.86 billion of revenues for
the year ended July 31, 2012.
ZOGENIX INC: Board OKs Employment Inducement Incentive Plan
-----------------------------------------------------------
The Board of Directors of Zogenix, Inc., approved the Zogenix,
Inc., Employment Inducement Equity Incentive Award Plan. The
terms of the Inducement Plan are substantially similar to the
terms of the Company's 2010 Equity Incentive Award Plan with two
principal exceptions:
(1) incentive stock options may not be granted under the
Inducement Plan; and
(2) the annual compensation paid by the Company to specified
executives will be deductible only to the extent that it
does not exceed $1,000,000, as the conditions of Section
162(m) of the Internal Revenue Code will not be met. The
Inducement Plan was adopted by the Board without
stockholder approval pursuant to Rule 5635(c)(4) of the
NASDAQ Listing Rules.
The Board has initially reserved 2,700,000 shares of the Company's
common stock for issuance pursuant to awards granted under the
Inducement Plan. In accordance with Rule 5635(c)(4) of the NASDAQ
Listing Rules, awards under the Inducement Plan may only be made
to an employee who has not previously been an employee or member
of the board of directors of the Company or any parent or
subsidiary, or following a bona fide period of non-employment by
the Company or a parent or subsidiary, if he or she is granted
such award in connection with his or her commencement of
employment with the Company or a subsidiary and that grant is an
inducement material to his or her entering into employment with
the Company or such subsidiary.
A complete copy of the Inducement Plan is available at:
http://is.gd/mI4vyh
Amendment of Annual Incentive Plan
On Dec. 4, 2013, the Board approved an amendment and restatement
of the Company's Annual Incentive Plan, pursuant to which (i) the
target bonus percentages were changed for individuals holding a
title of Chief Medical Officer or Executive Director and (ii) the
weighting of the portions of cash bonus payments that are based on
corporate performance goals and individual performance objectives
were changed for individuals holding a title of Chief Medical
Officer, Executive Director or Senior Director/Director.
The Company expects to adopt an annual incentive program for
future fiscal years, which will reward achievement at specified
levels of corporate and individual performance and will contain
target bonuses consistent with those disclosed in the Amended
Incentive Plan.
A complete copy of the Amended Incentive Plan is available at:
http://is.gd/fzykEc
About Zogenix Inc.
Zogenix, Inc. (NASDAQ: ZGNX), with offices in San Diego and
Emeryville, California, is a pharmaceutical company
commercializing and developing products for the treatment of
central nervous system disorders and pain.
Ernst & Young LLP, in San Diego, California, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2012, citing recurring losses from
operations and lack of sufficient working capital which raise
substantial doubt about the Company's ability to continue as a
going concern.
Zogenix incurred a net loss of $47.38 million in 2012, as compared
with a net loss of $83.90 million in 2011. The Company's balance
sheet at Sept. 30, 2013, showed $54.63 million in total assets,
$68.52 million in total liabilities and a $13.88 million total
stockholders' deficit.
* Glass-Steagall Fans Plan New Assault If Volcker Rule Deemed Weak
------------------------------------------------------------------
Phil Mattingly & Cheyenne Hopkins, writing for Bloomberg News,
reported that five U.S. agencies will finish the Volcker rule on
Dec. 10 after more than three years of Wall Street resistance to
its limits on trading and investing. Lawmakers and their allies
who want to rein in big banks are ready to pounce if it isn't
strict enough.
According to the report, politicians and advocates -- some
Democrats, some Republicans -- who blame the 2008 financial crisis
on deregulation express concern that the Volcker rule won't
adequately block banks from making risky bets with their own
money. If they deem the rule too weak, they say it will add fuel
to a push to reinstate a Depression-era law known as Glass-
Steagall that until 1999 split banks and securities firms.
Such vows suggest U.S. lenders planning to challenge the ban in
court risk a political backlash, the report said. A 2011 draft of
the rule, required by the Dodd-Frank Act at the urging of former
Federal Reserve chairman Paul Volcker, disappointed some
politicians and organizations who wanted a stronger ban. Lawmakers
already have drafted legislation.
"If people aren't satisfied with the implementation of this thing,
that'll redouble the pressure to go back and look for something
else," Marcus Stanley, policy director for Americans for Financial
Reform, an umbrella group of more than 250 organizations pushing
for stronger restrictions on Wall Street, said. "The Volcker rule
was the major thing that said that these guys just crashed the
world economy and we're going to ban something."
The rule aims to reduce the chances that banks will put federally
insured depositors' money at risk by banning proprietary trading,
the report further related. The Dodd-Frank Act proposed limited
exemptions on the ban for some hedging and market-making trades.
The debate since has focused on how those exemptions should be
defined.
* Banks Poised to Reduce Rate-Swap Trading as Revenue Seen Reduced
------------------------------------------------------------------
Matthew Leising, writing for Bloomberg News, reported that dealer
revenue from negotiating interest-rate swap transactions is poised
to plunge about 45 percent as new rules boost trading costs,
pressures that may prompt banks to participate less in the $633
trillion over-the-counter derivatives market, Tabb Group LLC
estimates.
According to the report, banks collect about $3.25 billion a year
from trading rate swaps with their customers, Tabb said. That
revenue will shrink to $1.8 billion in 2014 as most transactions
shift to public markets, according to a research report meant for
Tabb customers that Bloomberg News obtained. Dealers will also
need to hold more capital to back trades, boosting expenses, said
Will Rhode, who wrote the report.
"There probably will be some painful conversations at the end of
2013 about how much this business costs to run," Rhode said in a
phone interview with Bloomberg. While increased electronic
trading will reduce transaction sizes and lead to more trades, it
won't be enough to offset lost profits, he added. "There's no way
the turnover increase can be sufficient enough to make up for the
revenue shortfall," he said. "These products that were basically
free have just become much more expensive."
The 2010 Dodd-Frank Act mandated that swaps trading shift to
public markets, away from privately negotiated transactions, the
report related. The change was meant to increase transparency and
competition by shedding light on a market where banks used to take
one side of every transaction.
* S&P Puts Various California Statewide Communities on Watch Neg.
-----------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'CCC(sf)' and
'CC(sf)' long-term ratings on California Statewide Communities
Development Authority's multifamily housing revenue refunding
bonds (Quail Ridge Apartments Project), series 2002 E-1 and E-3
bonds, respectively, on CreditWatch with negative implications.
The rating action reflects S&P's view of the following weaknesses:
-- Draws on the series 2002E-3 debt service reserve fund (DSRF)
to pay debt service on senior bonds in July 2013;
-- Depletion of all other reserve funds, except the DSRF
established under indenture; and
-- Risk of debt service payment default, which arises from the
borrower's default to pay amounts required to make basic
loan payments under the loan agreement.
"The ratings' placement on CreditWatch with negative implications
reflects our view of the likelihood that an additional draw on the
DSRF for the January 2014 debt service payment will be made," said
Standard & Poor's credit analyst Aulii Limtiaco.
S&P bases this on the project's continued poor operating
performance to date, drawings on the DSRF, the exhaustion of all
other reserve funds, and the borrower's default on certain
covenants under the loan agreement. In addition, the borrower has
defaulted on its continuing disclosure requirement and has not
provided audited financial information. If continued draws from
the DSRF are made to pay debt service and the DSRF is depleted,
S&P will lower the rating.
* Large Companies With Insolvent Balance Sheets
-----------------------------------------------
Total
Share- Total
Total Holders' Working
Assets Equity Capital
Company Ticker ($MM) ($MM) ($MM)
------- ------ ------ -------- -------
ABSOLUTE SOFTWRE ABT CN 129.8 (11.3) (10.7)
ABSOLUTE SOFTWRE ALSWF US 129.8 (11.3) (10.7)
ABSOLUTE SOFTWRE OU1 GR 129.8 (11.3) (10.7)
ACCELERON PHARMA 0A3 GR 48.4 (19.9) 6.2
ACCELERON PHARMA XLRN US 48.4 (19.9) 6.2
ADVANCED EMISSIO OXQ1 GR 106.4 (46.1) (15.3)
ADVANCED EMISSIO ADES US 106.4 (46.1) (15.3)
ADVENT SOFTWARE ADVS US 454.9 (133.8) (83.4)
ADVENT SOFTWARE AXQ GR 454.9 (133.8) (83.4)
AERIE PHARMACEUT AERI US 7.2 (22.4) (11.0)
AIR CANADA-CL A AIDIF US 9,481.0 (3,056.0) 105.0
AIR CANADA-CL A ADH GR 9,481.0 (3,056.0) 105.0
AIR CANADA-CL A AC/A CN 9,481.0 (3,056.0) 105.0
AIR CANADA-CL A ADH TH 9,481.0 (3,056.0) 105.0
AIR CANADA-CL B ADH1 GR 9,481.0 (3,056.0) 105.0
AIR CANADA-CL B AIDEF US 9,481.0 (3,056.0) 105.0
AIR CANADA-CL B AC/B CN 9,481.0 (3,056.0) 105.0
AIR CANADA-CL B ADH1 TH 9,481.0 (3,056.0) 105.0
AK STEEL HLDG AK2 TH 3,766.4 (211.8) 394.9
AK STEEL HLDG AKS* MM 3,766.4 (211.8) 394.9
AK STEEL HLDG AKS US 3,766.4 (211.8) 394.9
AK STEEL HLDG AK2 GR 3,766.4 (211.8) 394.9
ALLIANCE HEALTHC AIQ US 515.6 (131.4) 61.3
AMC NETWORKS-A 9AC GR 2,524.8 (611.9) 790.3
AMC NETWORKS-A AMCX US 2,524.8 (611.9) 790.3
AMER AXLE & MFG AYA GR 3,118.5 (46.8) 387.6
AMER AXLE & MFG AXL US 3,118.5 (46.8) 387.6
AMR CORP AAMRQ* MM 26,780.0 (7,922.0) 143.0
AMR CORP ACP GR 26,780.0 (7,922.0) 143.0
AMR CORP AAMRQ US 26,780.0 (7,922.0) 143.0
AMYLIN PHARMACEU AMLN US 1,998.7 (42.4) 263.0
ANACOR PHARMACEU ANAC US 44.9 (7.3) 17.0
ANACOR PHARMACEU 44A TH 44.9 (7.3) 17.0
ANACOR PHARMACEU 44A GR 44.9 (7.3) 17.0
ANGIE'S LIST INC 8AL GR 109.7 (23.0) (24.2)
ANGIE'S LIST INC 8AL TH 109.7 (23.0) (24.2)
ANGIE'S LIST INC ANGI US 109.7 (23.0) (24.2)
ARRAY BIOPHARMA AR2 TH 152.6 (13.2) 82.3
ARRAY BIOPHARMA AR2 GR 152.6 (13.2) 82.3
ARRAY BIOPHARMA ARRY US 152.6 (13.2) 82.3
AUTOZONE INC AZO US 6,892.1 (1,687.3) (891.1)
AUTOZONE INC AZ5 TH 6,892.1 (1,687.3) (891.1)
AUTOZONE INC AZ5 GR 6,892.1 (1,687.3) (891.1)
BARRACUDA NETWOR CUDA US 236.2 (90.1) (66.5)
BARRACUDA NETWOR 7BM GR 236.2 (90.1) (66.5)
BENEFITFOCUS INC BNFT US 54.8 (43.9) (3.6)
BENEFITFOCUS INC BTF GR 54.8 (43.9) (3.6)
BERRY PLASTICS G BERY US 5,135.0 (196.0) (3,393.0)
BERRY PLASTICS G BP0 GR 5,135.0 (196.0) (3,393.0)
BOSTON PIZZA R-U BPF-U CN 156.7 (108.0) (4.2)
BOSTON PIZZA R-U BPZZF US 156.7 (108.0) (4.2)
BRP INC/CA-SUB V BRPIF US 1,779.0 (131.6) 51.1
BRP INC/CA-SUB V DOO CN 1,779.0 (131.6) 51.1
BRP INC/CA-SUB V B15A GR 1,779.0 (131.6) 51.1
BURLINGTON STORE BUI GR 2,594.2 (421.3) 139.7
BURLINGTON STORE BURL US 2,594.2 (421.3) 139.7
CABLEVISION SY-A CVC US 6,482.1 (5,284.1) 342.2
CABLEVISION SY-A CVY GR 6,482.1 (5,284.1) 342.2
CAESARS ENTERTAI C08 GR 26,096.4 (1,496.8) 626.7
CAESARS ENTERTAI CZR US 26,096.4 (1,496.8) 626.7
CANNAVEST CORP CANV US 10.7 (0.2) (1.3)
CAPMARK FINANCIA CPMK US 20,085.1 (933.1) -
CC MEDIA-A CCMO US 15,231.2 (8,370.8) 786.9
CENTENNIAL COMM CYCL US 1,480.9 (925.9) (52.1)
CENVEO INC CVO US 1,238.5 (473.0) 143.1
CHOICE HOTELS CHH US 555.7 (484.7) 79.2
CHOICE HOTELS CZH GR 555.7 (484.7) 79.2
CIENA CORP CIE1 TH 1,727.4 (83.2) 763.4
CIENA CORP CIE1 GR 1,727.4 (83.2) 763.4
CIENA CORP CIEN US 1,727.4 (83.2) 763.4
CIENA CORP CIEN TE 1,727.4 (83.2) 763.4
CINCINNATI BELL CBB US 2,551.7 (687.2) (147.2)
COMVERSE INC CNSI US 844.8 (9.4) (6.1)
COMVERSE INC CM1 GR 844.8 (9.4) (6.1)
DENDREON CORP DNDN US 522.1 (161.2) 207.0
DIRECTV DTV CI 20,588.0 (6,208.0) (300.0)
DIRECTV DIG1 GR 20,588.0 (6,208.0) (300.0)
DIRECTV DTV US 20,588.0 (6,208.0) (300.0)
DOMINO'S PIZZA EZV GR 468.5 (1,322.2) 76.9
DOMINO'S PIZZA EZV TH 468.5 (1,322.2) 76.9
DOMINO'S PIZZA DPZ US 468.5 (1,322.2) 76.9
DUN & BRADSTREET DB5 TH 1,849.9 (1,206.3) (128.9)
DUN & BRADSTREET DB5 GR 1,849.9 (1,206.3) (128.9)
DUN & BRADSTREET DNB US 1,849.9 (1,206.3) (128.9)
DYAX CORP DY8 GR 70.6 (38.8) 41.0
DYAX CORP DYAX US 70.6 (38.8) 41.0
EASTMAN KODAK CO KODN GR 3,815.0 (3,153.0) (785.0)
EASTMAN KODAK CO KODK US 3,815.0 (3,153.0) (785.0)
ENTRAVISION CO-A EV9 GR 455.7 (5.6) 78.1
ENTRAVISION CO-A EVC US 455.7 (5.6) 78.1
EVERYWARE GLOBAL EVRY US 356.6 (53.9) 142.5
FAIRPOINT COMMUN FRP US 1,592.6 (406.7) 30.0
FERRELLGAS-LP FEG GR 1,356.0 (86.6) (21.3)
FERRELLGAS-LP FGP US 1,356.0 (86.6) (21.3)
FIFTH & PACIFIC LIZ GR 846.2 (213.7) (64.6)
FIFTH & PACIFIC FNP US 846.2 (213.7) (64.6)
FOREST OIL CORP FST US 1,909.3 (63.1) (148.3)
FREESCALE SEMICO 1FS TH 3,819.0 (4,526.0) 1,239.0
FREESCALE SEMICO 1FS GR 3,819.0 (4,526.0) 1,239.0
FREESCALE SEMICO FSL US 3,819.0 (4,526.0) 1,239.0
GENCORP INC GCY GR 1,750.4 (142.6) 111.1
GENCORP INC GY US 1,750.4 (142.6) 111.1
GLG PARTNERS INC GLG US 400.0 (285.6) 156.9
GLG PARTNERS-UTS GLG/U US 400.0 (285.6) 156.9
GLOBAL BRASS & C BRSS US 576.5 (37.0) 286.9
GLOBAL BRASS & C 6GB GR 576.5 (37.0) 286.9
GOLD RESERVE INC GDRZF US 23.7 (0.1) (17.3)
GOLD RESERVE INC GRZ CN 23.7 (0.1) (17.3)
GRAHAM PACKAGING GRM US 2,947.5 (520.8) 298.5
HALOZYME THERAPE HALO US 110.1 (3.5) 63.2
HALOZYME THERAPE HALOZ GR 110.1 (3.5) 63.2
HCA HOLDINGS INC 2BH TH 28,393.0 (7,044.0) 2,352.0
HCA HOLDINGS INC 2BH GR 28,393.0 (7,044.0) 2,352.0
HCA HOLDINGS INC HCA US 28,393.0 (7,044.0) 2,352.0
HD SUPPLY HOLDIN HDS US 6,587.0 (753.0) 1,281.0
HD SUPPLY HOLDIN 5HD GR 6,587.0 (753.0) 1,281.0
HOVNANIAN ENT-A HOV US 1,664.1 (467.2) 950.2
HOVNANIAN ENT-A HO3 GR 1,664.1 (467.2) 950.2
HOVNANIAN ENT-B HOVVB US 1,664.1 (467.2) 950.2
HUGHES TELEMATIC HUTC US 110.2 (101.6) (113.8)
HUGHES TELEMATIC HUTCU US 110.2 (101.6) (113.8)
IMMUNE PHARMACEU IMNP SS 1.0 (16.2) (8.9)
IMMUNE PHARMACEU EPCTSEK EU 1.0 (16.2) (8.9)
IMMUNE PHARMACEU IMNP TQ 1.0 (16.2) (8.9)
IMMUNE PHARMACEU IMNP BY 1.0 (16.2) (8.9)
INFOR US INC LWSN US 6,515.2 (555.7) (303.6)
INSYS THERAPEUTI NPR1 GR 22.2 (63.5) (70.0)
INSYS THERAPEUTI INSY US 22.2 (63.5) (70.0)
IPCS INC IPCS US 559.2 (33.0) 72.1
ISTA PHARMACEUTI ISTA US 124.7 (64.8) 2.2
JUST ENERGY GROU JE CN 1,533.5 (359.8) (281.4)
JUST ENERGY GROU JE US 1,533.5 (359.8) (281.4)
JUST ENERGY GROU 1JE GR 1,533.5 (359.8) (281.4)
L BRANDS INC LTD GR 6,072.0 (861.0) 613.0
L BRANDS INC LB US 6,072.0 (861.0) 613.0
L BRANDS INC LTD TH 6,072.0 (861.0) 613.0
LDR HOLDING CORP LDRH US 78.7 (0.6) 9.6
LEE ENTERPRISES LEE US 989.0 (102.6) (11.9)
LORILLARD INC LO US 3,555.0 (2,042.0) 1,297.0
LORILLARD INC LLV GR 3,555.0 (2,042.0) 1,297.0
LORILLARD INC LLV TH 3,555.0 (2,042.0) 1,297.0
MACROGENICS INC M55 GR 42.2 (10.9) 9.9
MACROGENICS INC MGNX US 42.2 (10.9) 9.9
MANNKIND CORP NNF1 TH 287.6 (167.7) (138.5)
MANNKIND CORP NNF1 GR 287.6 (167.7) (138.5)
MANNKIND CORP MNKD US 287.6 (167.7) (138.5)
MARRIOTT INTL-A MAR US 6,480.0 (1,409.0) (776.0)
MARRIOTT INTL-A MAQ TH 6,480.0 (1,409.0) (776.0)
MARRIOTT INTL-A MAQ GR 6,480.0 (1,409.0) (776.0)
MARRONE BIO INNO MBII US 25.6 (47.8) (12.8)
MDC PARTNERS-A MDZ/A CN 1,365.7 (40.1) (211.1)
MDC PARTNERS-A MDCA US 1,365.7 (40.1) (211.1)
MDC PARTNERS-A MD7A GR 1,365.7 (40.1) (211.1)
MEDIA GENERAL MEG US 749.9 (217.2) 36.8
MERITOR INC AID1 GR 2,570.0 (822.0) 338.0
MERITOR INC MTOR US 2,570.0 (822.0) 338.0
MERRIMACK PHARMA MACK US 224.2 (16.6) 139.4
MERRIMACK PHARMA MP6 GR 224.2 (16.6) 139.4
MIRATI THERAPEUT MRTX US 18.0 (23.6) (24.5)
MONEYGRAM INTERN MGI US 4,923.2 (116.3) 49.2
MORGANS HOTEL GR M1U GR 572.8 (172.9) 6.5
MORGANS HOTEL GR MHGC US 572.8 (172.9) 6.5
MPG OFFICE TRUST MPG US 1,280.0 (437.3) -
NATIONAL CINEMED NCMI US 982.5 (217.5) 139.1
NATIONAL CINEMED XWM GR 982.5 (217.5) 139.1
NAVISTAR INTL IHR GR 8,241.0 (3,933.0) 1,329.0
NAVISTAR INTL IHR TH 8,241.0 (3,933.0) 1,329.0
NAVISTAR INTL NAV US 8,241.0 (3,933.0) 1,329.0
NEKTAR THERAPEUT ITH GR 383.0 (50.3) 127.0
NEKTAR THERAPEUT NKTR US 383.0 (50.3) 127.0
NORCRAFT COS INC NCFT US 265.0 (6.1) 47.7
NORCRAFT COS INC 6NC GR 265.0 (6.1) 47.7
NORTHWEST BIO NWBO US 2.4 (16.2) (16.3)
NYMOX PHARMACEUT NYMX US 1.4 (6.9) (2.7)
NYMOX PHARMACEUT NY2 GR 1.4 (6.9) (2.7)
OCI PARTNERS LP OCIP US 460.3 (98.7) 79.8
OMEROS CORP OMER US 12.0 (23.9) (1.6)
OMEROS CORP 3O8 GR 12.0 (23.9) (1.6)
OMTHERA PHARMACE OMTH US 18.3 (8.5) (12.0)
OPHTHTECH CORP OPHT US 40.2 (7.3) 34.3
OPHTHTECH CORP O2T GR 40.2 (7.3) 34.3
PALM INC PALM US 1,007.2 (6.2) 141.7
PHILIP MORRIS IN PM US 36,795.0 (5,908.0) (2.0)
PHILIP MORRIS IN PMI SW 36,795.0 (5,908.0) (2.0)
PHILIP MORRIS IN PM1CHF EU 36,795.0 (5,908.0) (2.0)
PHILIP MORRIS IN PM FP 36,795.0 (5,908.0) (2.0)
PHILIP MORRIS IN 4I1 TH 36,795.0 (5,908.0) (2.0)
PHILIP MORRIS IN PM1 TE 36,795.0 (5,908.0) (2.0)
PHILIP MORRIS IN 4I1 GR 36,795.0 (5,908.0) (2.0)
PHILIP MORRIS IN PM1EUR EU 36,795.0 (5,908.0) (2.0)
PLAYBOY ENTERP-A PLA/A US 165.8 (54.4) (16.9)
PLAYBOY ENTERP-B PLA US 165.8 (54.4) (16.9)
PLY GEM HOLDINGS PGEM US 1,088.3 (37.7) 212.1
PLY GEM HOLDINGS PG6 GR 1,088.3 (37.7) 212.1
PROTALEX INC PRTX US 2.0 (7.6) (0.5)
PROTECTION ONE PONE US 562.9 (61.8) (7.6)
QUALITY DISTRIBU QLTY US 465.1 (38.1) 92.3
QUICKSILVER RES KWK US 1,331.6 (964.5) 234.3
QUINTILES TRANSN QTS GR 2,842.0 (712.0) 382.8
QUINTILES TRANSN Q US 2,842.0 (712.0) 382.8
RE/MAX HOLDINGS 2RM GR 252.0 (22.5) 39.1
RE/MAX HOLDINGS RMAX US 252.0 (22.5) 39.1
REGAL ENTERTAI-A RGC US 2,508.3 (658.5) 54.0
REGAL ENTERTAI-A RETA GR 2,508.3 (658.5) 54.0
RENAISSANCE LEA RLRN US 57.0 (28.2) (31.4)
RENTPATH INC PRM US 208.0 (91.7) 3.6
RETROPHIN INC RTRX US 2.7 (8.5) (10.7)
REVLON INC-A RVL1 GR 1,259.4 (619.8) 192.4
REVLON INC-A REV US 1,259.4 (619.8) 192.4
RINGCENTRAL IN-A RNG US 48.5 (20.7) (22.8)
RINGCENTRAL IN-A 3RCA GR 48.5 (20.7) (22.8)
RITE AID CORP RTA GR 7,169.0 (2,317.9) 1,943.6
RITE AID CORP RAD US 7,169.0 (2,317.9) 1,943.6
RURAL/METRO CORP RURL US 303.7 (92.1) 72.4
SALLY BEAUTY HOL SBH US 1,950.1 (303.5) 473.2
SALLY BEAUTY HOL S7V GR 1,950.1 (303.5) 473.2
SILVER SPRING NE 9SI TH 513.9 (88.9) 76.3
SILVER SPRING NE 9SI GR 513.9 (88.9) 76.3
SILVER SPRING NE SSNI US 513.9 (88.9) 76.3
SUNESIS PHARMAC RYIN TH 46.6 (5.8) 11.2
SUNESIS PHARMAC SNSS US 46.6 (5.8) 11.2
SUNESIS PHARMAC RYIN GR 46.6 (5.8) 11.2
SUNGAME CORP SGMZ US 0.1 (2.2) (2.3)
SUPERVALU INC SJ1 TH 4,738.0 (1,031.0) 154.0
SUPERVALU INC SVU* MM 4,738.0 (1,031.0) 154.0
SUPERVALU INC SJ1 GR 4,738.0 (1,031.0) 154.0
SUPERVALU INC SVU US 4,738.0 (1,031.0) 154.0
TANDEM DIABETES TD5 GR 48.6 (2.8) 13.8
TANDEM DIABETES TNDM US 48.6 (2.8) 13.8
TAUBMAN CENTERS TU8 GR 3,438.8 (211.5) -
TAUBMAN CENTERS TCO US 3,438.8 (211.5) -
THRESHOLD PHARMA THLD US 101.0 (17.5) 74.4
THRESHOLD PHARMA NZW1 GR 101.0 (17.5) 74.4
TOWN SPORTS INTE T3D GR 408.9 (40.4) (3.9)
TOWN SPORTS INTE CLUB US 408.9 (40.4) (3.9)
TRANSDIGM GROUP TDG US 6,148.9 (336.4) 998.0
TRANSDIGM GROUP T7D GR 6,148.9 (336.4) 998.0
ULTRA PETROLEUM UPL US 2,069.0 (376.8) (243.9)
ULTRA PETROLEUM UPM GR 2,069.0 (376.8) (243.9)
UNISYS CORP UIS US 2,237.7 (1,509.9) 411.6
UNISYS CORP UIS1 SW 2,237.7 (1,509.9) 411.6
UNISYS CORP UISCHF EU 2,237.7 (1,509.9) 411.6
UNISYS CORP UISEUR EU 2,237.7 (1,509.9) 411.6
UNISYS CORP USY1 GR 2,237.7 (1,509.9) 411.6
UNISYS CORP USY1 TH 2,237.7 (1,509.9) 411.6
VECTOR GROUP LTD VGR US 1,121.0 (192.6) 316.7
VECTOR GROUP LTD VGR GR 1,121.0 (192.6) 316.7
VENOCO INC VQ US 695.2 (258.7) (39.2)
VERISIGN INC VRSN US 2,330.0 (493.8) 97.7
VERISIGN INC VRS TH 2,330.0 (493.8) 97.7
VERISIGN INC VRS GR 2,330.0 (493.8) 97.7
VINCE HOLDING CO VNCE US 467.8 (179.1) 7.7
VIRGIN MOBILE-A VM US 307.4 (244.2) (138.3)
WEIGHT WATCHERS WTW US 1,408.2 (1,509.4) (79.8)
WEIGHT WATCHERS WW6 GR 1,408.2 (1,509.4) (79.8)
WEST CORP WT2 GR 3,480.7 (782.6) 349.0
WEST CORP WSTC US 3,480.7 (782.6) 349.0
WESTMORELAND COA WLB US 939.8 (280.3) 4.1
WESTMORELAND COA WME GR 939.8 (280.3) 4.1
XERIUM TECHNOLOG XRM US 626.9 (25.4) 128.4
XERIUM TECHNOLOG TXRN GR 626.9 (25.4) 128.4
XOMA CORP XOMA US 91.0 (13.5) 58.8
XOMA CORP XOMA GR 91.0 (13.5) 58.8
XOMA CORP XOMA TH 91.0 (13.5) 58.8
ZOGENIX INC ZGNX US 54.6 (13.9) 3.1
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers"
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com/
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors" Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine
Tumanda, Valerie Udtuhan, Howard C. Tolentino, Carmel Paderog,
Meriam Fernandez, Ronald C. Sy, Joel Anthony G. Lopez, Cecil R.
Villacampa, Sheryl Joy P. Olano, Ivy B. Magdadaro, Carlo
Fernandez, Christopher G. Patalinghug, and Peter A. Chapman,
Editors.
Copyright 2013. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $975 for 6 months delivered via
e-mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Peter A.
Chapman at 215-945-7000 or Nina Novak at 202-241-8200.
*** End of Transmission ***