/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/131227.mbx T R O U B L E D C O M P A N Y R E P O R T E R Friday, December 27, 2013, Vol. 17, No. 357 Headlines 56 WALKER LLC: Tribeca Bldg to Sell for $18MM in Second Bankruptcy 710 LONG RIDGE: HealthBridge in Contempt for Not Paying Workers AEOLUS PHARMACEUTICALS: Incurs $3.2-Mil. Net Loss in Fiscal 2013 ALLENS INC: Sets Jan. 6 Hearing for Auction Procedures APOLLO MEDICAL: Incurs $1 Million Net Loss in Third Quarter ASR CONSTRUCTORS: May Hire Rodgers Anderson as Accountant ATLANTIC COAST FIN'L: Atlanta Fed Okays Hogan Appointment as CFO CDT HORMIGUEROS: Case Summary & 23 Largest Unsecured Creditors CHA CHA ENTERPRISES: Has Nod to Use Cash Collateral Until Jan. 12 COLEMAN CABLE: S&P Puts 'B+' CCR on CreditWatch Developing COLLEGE WAY: Sec. 341(a) Creditors' Meeting Set for Jan. 15 COMMUNITYONE BANCORP: Director to Retire for Personal Reasons CONSTAR INTERNATIONAL: Returns to Chapter 11; Has $14MM Financing CONSTAR INTERNATIONAL: Meeting to Form Creditors' Panel on Jan. 3 CONSTAR INTERNATIONAL: Sec. 341(a) Creditors' Meeting on Jan. 28 COYOTE MOON: Section 341(a) Meeting Scheduled for Jan. 28 DETROIT, MI: City, Banks Agree to Further Cut Termination Amount DETROIT, MI: Bankruptcy Judge Bars Appeal in Civil Rights Case DETROIT, MI: Now Has Official Creditors' Committee in Chapter 9 DOLPHIN BAY: Sec. 341(a) Creditors' Meeting Scheduled for Jan. 15 DYNASIL CORP: Incurs $8.7 Million Net Loss in Fiscal 2013 ELEPHANT TALK: Stockholders Elect Three Directors F & H ACQUISITION: Meeting to Form Creditors' Panel on Jan. 3 FAIRMONT GENERAL: Expects Buyer or Investor in March FIRSTLIGHT HYDRO: Fails to Receive Bondholders' Consent FISKER AUTOMOTIVE: Plan Approval May Be Delayed by Workers' Claims FNBH BANCORP: Moross LP No Longer Holds Shares FNBH BANCORP: Stanley Dickson Held 43.5% Stake at Dec. 11 FNBH BANCORP: Steven Dickson Held 7.5% Equity Stake at Dec. 11 FPL ENERGY: S&P Raises Rating on $365MM Sr. Sec. Bonds to 'BB' FRIENDFINDER NETWORKS: Emerges From Chapter 11 Bankruptcy FRIENDSHIP DAIRIES: Wants McFinney & Agstar Held in Contempt FURNITURE BRANDS: Meredith Graham Okayed to Lead Liquidation HARI RAM: Voluntary Chapter 11 Case Summary HOKU CORP: Washington Contractor Wins Auction for Idaho Plant HOVNANIAN ENTERPRISES: Posts $31.3MM Net Income in Fiscal 2013 INT'L FOREIGN EXCHANGE: CDG Group May Provide Crisis Mgmt Services INT'L FOREIGN EXCHANGE: DiConza Taurig Okayed as Conflicts Counsel KAIDANS INC: Voluntary Chapter 11 Case Summary KEYWELL LLC: Creditors Sue Executives Over Bankruptcy KGB: S&P Withdraws 'B-' Corp. Credit Rating on Issuer's Request LEHMAN BROTHERS: Judge Peck Wants Intel Swap Suit in His Court LIFECARE HOLDINGS: Dismissal of Chapter 11 Sought LOEHMANN'S HOLDINGS: Proposes Up to $650,000 Bonus to Top Execs LONE PINE: Requests Reorganization Plan Confirmation in U.S. LONGVIEW POWER: Court Approves Plan Outline LOS GATOS HOTEL: Jan. 16 Hearing on Creditor's Bid to Market Hotel MERCANTILE BANCORP: Seeks Exclusivity to Complete Bank Sale METEX MANUFACTURING: Files Plan With $190 Million Asbestos Trust MI PUEBLO: Court Okays Cash Collateral Use Until Jan. 12 MICROVISION INC: Receives Nasdaq Listing Deficiency Notice MONTREAL MAINE: Victims Seek to Disband Committee MOORE FREIGHT: Drew McElroy, et al. Okayed as Litigation Counsel NAVISTAR INTERNATIONAL: Had $898 Million Net Loss in Fiscal 2013 NEW ENGLAND COMPOUNDING: $100+ Mil. Creditors Fund to Be Set Up NEWLEAD HOLDINGS: Gets NASDAQ Non-Compliance Notice NEXTAG INC: Providence Equity's Firm at Caa2 on Lower Revenue OCZ TECHNOLOGY: To Auction Assets in Jan.; Toshiba Leads Bidding ORCHARD SUPPLY: Sold as Chapter 11 Plan Confirmed PALM BEACH COMMUNITY: May Hire Furr and Cohen as Attorneys PALM BEACH COMMUNITY: SmartPlan Financial Okayed as Accountant PALM BEACH COMMUNITY: Won't Have Creditors' Committee PAPA ADVERTISING: Case Summary & 20 Largest Unsecured Creditors PHYSIOTHERAPY HOLDINGS: Has Access to Cash Collateral Until Jan. 3 PHYSIOTHERAPY HOLDINGS: Prepackaged Chapter 11 Plan Is Confirmed RESIDENTIAL CAPITAL: Trust to Make Initial Cash Distribution RGR WATKINS: Reaches Settlement With CJUF, Wants Case Dismissed RIH ACQUISITIONS: Judge Approves Sale of Atlantic Club Casino RIVIERA DRILLING: Deadline Doesn't Apply to Block Creditor's Plan RJC REALTY: Case Summary & 20 Largest Unsecured Creditors SAN JOSE, CA: Judge Blocks Pension Cuts SCICOM DATA: May Hire George McGunnigle as Mediator SCICOM DATA: Court Okays HLB Tautges as Accountant SHILO INN, TWIN FALLS: Can Use CBT's Cash Collateral Until June 30 SIMPLY WHEELZ: Court Approves Advantage, Hertz Vehicle Settlement SOUND SHORE: Exclusive Plan Filing Deadline Moved to Jan. 24 SURTRONICS INC: Can Continue Cash Collateral Use Until Dec. 31 SURTRONICS INC: May Hire Poyner Spruill as Special Counsel SURTRONICS INC: Amends Schedules of Assets & Liabilities SURTONICS INC: No Creditors' Committee Appointed T-L BRYWOOD: Has OK to Use RCG-KC's Cash Collateral Until Dec. 31 TIM C. THOMAS INC: Case Summary & Largest Unsecured Creditors TLO LLC: Equity Holders Want Asher Loan Subordinated UNITED PROPERTIES: Case Summary & 2 Largest Unsecured Creditors USEC INC: Says Energy Dept. Prepared to Extend Centrifuge Research VERMILLION INC: Completes $17.6 Million Warrant Exercise WR GRACE: Last Settlement Permits Chapter 11 Exit WAVE SYSTEMS: Completes $1.2 Million Stock Offering WESTERN FUNDING: Westlake Services Wins Auction for Loans WHEATLAND MARKETPLACE: Can Use Cash Collateral Until Jan. 31 WPCS INTERNATIONAL: Investors Swap $827,000 Notes for Equity YRC WORLDWIDE: Has Deal With Noteholders to Cut Debt by $300MM YUKOS OIL: Russia Supreme Court to Review Khodorkovsky Cases ZLOMREX INTERNATIONAL: Finance Company Seeks U.S. Protection ZLOMREX INTERNATIONAL: Chapter 15 Case Summary * Child Tax Credit Doesn't Qualify as Exempt Property * Mortgage Enforceable Without Interest Rate or Maturity * Real Estate Broker's Contested Commission Is Dischargeable Debt * American Express Reaches Add-On Card Settlement * Housing Sales Rise to Highest Level Since 2008 * PNC Agrees to Pay $35MM to Settle Discriminatory Loan Claims * Volcker Rule Challenged in U.S. Court by American Bankers Asso. * BOOK REVIEW: Creating Value through Corporate Restructuring: Case Studies in Bankruptcies, Buyouts, and Breakups ********* 56 WALKER LLC: Tribeca Bldg to Sell for $18MM in Second Bankruptcy ------------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the building at 56 Walker Street in the Tribeca section of Manhattan is scheduled to be sold next month for $18 million as part of a Chapter 11 plan. According to the report, in bankruptcy a second time, the building's owner filed a Chapter 11 petition in May, at the time aiming to sell the property for $23 million to pay off what was then said to be about $14 million in mortgages and $2 million in unsecured debt. An auction was canceled when no one outbid the $18 million offer. The bankruptcy court is on the cusp of approving disclosure materials explaining the Chapter 11 plan, the building's attorney, Jonathan Pasternak, said in a phone interview. The confirmation hearing for approval of the plan will take place on Jan. 28, said Pasternak, of Delbello Donnellan Weingarten Wise & Wiederkehr LLP in White Plains, New York. The sale will be completed about a week after plan approval, he said. Closing the sale along with plan confirmation avoids paying transfer taxes under Section 1146 of the Bankruptcy Code, according to the lawyer. The plan is designed to pay secured creditors in full. Depending on the outcome of litigation or settlement with the lender on the amount of the mortgage, unsecured creditors with $4.88 million in claims could be paid in full. The previous bankruptcy began in September 2011 and was dismissed in August 2012 when the bankruptcy judge refused to approve a settlement. About 56 Walker LLC 56 Walker LLC, the owner of a six-story building at 56 Walker Street in the Tribeca section of Manhattan, returned to Chapter 11 (Bankr. S.D.N.Y. Case No. 13-11571) on May 13, 2013, this time aiming for a $23 million sale to pay off about $14 million in mortgages and $2 million in unsecured debt. The Debtor scheduled assets of $23,000,000 and liabilities of $15,996,104. Judge Shelley Chapman was initially assigned to the case but the case was transferred to Judge Allan L. Gropper. Erica Feynman Aisner, Esq., at Delbello Donnellan Weingarten Wise & Wiederkehr, LLP, serves as the Debtor's counsel. The previous Chapter 11 case began in September 2011 and was dismissed in August 2012 when the bankruptcy judge refused to approve a settlement. 710 LONG RIDGE: HealthBridge in Contempt for Not Paying Workers --------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that HealthBridge Management LLC, the non-bankrupt manager of five bankrupt Connecticut nursing homes, was held in contempt for failure to obey a federal district court order requiring compliance with a union contract, casting doubt over whether the nursing homes can win approval of their reorganization plan at a Jan. 30 confirmation hearing. According to the report, in December 2012, U.S. District Judge Robert N. Chatigny in New Haven, Connecticut, ordered HealthBridge and the nursing homes to reinstate fired workers and pay wages and benefits under an expired union contract. The nursing homes responded by filing a Chapter 11 petition in February in U.S. Bankruptcy Court in Newark, New Jersey, blaming financial problems on the cost of union contracts. HealthBridge itself didn't file. The nursing homes rehired the workers, while asking U.S. Bankruptcy Judge Donald H. Steckroth in Newark to invoke bankruptcy law to let the homes cut benefits to levels lower than under the expired contract. The National Labor Relations Board filed in May to hold HealthBridge in contempt for non-compliance with Judge Chatigny's order. HealthBridge said it was never the employer and couldn't be held in contempt for not volunteering to pay back wages and benefits. The company also said the NLRB's motion infringed on the jurisdiction of the bankruptcy court. Judge Chatigny rejected those defenses, and on Dec. 23 held HealthBridge in contempt for failure to restore the wages and benefits in violation of last year's injunction. He also directed HealthBridge to make the workers whole for wages and benefits lost since February. He gave HealthBridge 20 days to file an affidavit showing compliance. "We expect them to comply but given their past performance they will use every effort to delay compliance," labor attorney John Creane, Esq. -- JMCreane@AOL.com -- of Milford, Connecticut, said in phone interview. Creane represents the New England Health Care Employees Union, District 1199, which participated in the injunction actions. Rosemary Alito, Esq. -- rosemary.alito@klgates.com -- an attorney for HealthBridge at K&L Gates LLP in Newark, didn't return a call seeking comment on the ruling. On the offensive in another regard, the NLRB filed papers in bankruptcy court on Dec. 24 seeking temporary validity for its $14.6 million in claims on behalf of workers. The labor board said $8.9 million of the sum represents a priority claim that must be paid in full in Chapter 11. In return for covering future operating deficits, the nursing home owners are to retain the equity under a reorganization plan. HealthBridge isn't in bankruptcy, nor is Care Realty LLC, the ultimate owner of the homes and a sponsor of the plan. About 710 Long Ridge Road Operating Company II 710 Long Ridge Road Operating Company II, LLC and four affiliates own sub-acute and long-term nursing care facilities for the elderly in Connecticut. The facilities, which are managed by HealthBridge Management LLC, are Long Ridge of Stamford, Newington Health Care Center, Westport Health Care Center, West River Health Care Center, and Danbury Health Care Center. 710 Long Ridge Road Operating Company II and its affiliates sought Chapter 11 protection (Bankr. D.N.J. Case Nos. 13-13653 to 13- 13657) on Feb. 24, 2013, to modify their collective bargaining agreements with the New England Health Care Employees Union, District 1199, SEIU. The Debtors owe $18.9 million to M&T Bank and $7.99 million on loans from the U.S. Department of Housing and Urban Development Federal Housing Administration. Michael D. Sirota, Esq., at Cole, Schotz, Meisel, Forman & Leonard, serve as counsel to the Debtors. Logan & Company, Inc. is the claims and notice agent. Alvarez & Marsal Healthcare Industry Group, LLC, is the financial advisor. Porzio, Bromberg & Newman, P.C., represents the Official Committee of Unsecured Creditors. The Committee tapped to retain EisnerAmper LLP as accountant. AEOLUS PHARMACEUTICALS: Incurs $3.2-Mil. Net Loss in Fiscal 2013 ---------------------------------------------------------------- Aeolus Pharmaceuticals, Inc., filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K disclosing a net loss of $3.20 million on $3.92 million of contract revenue for the fiscal year ended Sept. 30, 2013, as compared with net income of $1.69 million on $7.29 million of contract revenue during the prior fiscal year. As of Sept. 30, 2013, the Company had $1.96 million in total assets, $1.26 million in total liabilities and $705,000 in total stockholders' equity. Grant Thornton LLP, in San Diego, California, issued a "going concern" qualification on the consolidated financial statements for the year ended Sept. 30, 2013. The independent auditors noted that the Company has incurred recurring losses and negative cash flows from operations, and management believes the Company does not currently possess sufficient working capital to fund its operations through fiscal 2014. These conditions, along with other matters . . . raise substantial doubt about the Company's ability to continue as a going concern. A copy of the Form 10-K is available for free at: http://is.gd/7bAs9M About Aeolus Pharmaceuticals Mission Viejo, California-based Aeolus Pharmaceuticals, Inc., is a Southern California-based biopharmaceutical company leveraging significant government investment to develop a platform of novel compounds in oncology and biodefense. The platform consists of over 200 compounds licensed from Duke University and National Jewish Health. The Company's lead compound, AEOL 10150, is being developed as a medical countermeasure ("MCM") against the pulmonary sub-syndrome of acute radiation syndrome ("Pulmonary Acute Radiation Syndrome" or "Lung-ARS") as well as the gastrointestinal sub-syndrome of acute radiation syndrome ("GI-ARS"). Both syndromes are caused by acute exposure to high levels of radiation due to a radiological or nuclear event. It is also being developed for use as a MCM for exposure to chemical vesicants such as chlorine gas, sulfur mustard gas and nerve agents. ALLENS INC: Sets Jan. 6 Hearing for Auction Procedures ------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Allens Inc., a processor of canned vegetables, filed formal papers setting up a hearing on Jan. 6 for approval of auction procedures to determine if the $148 million offer from Seneca Foods Corp. is the best bid to buy the business. According to the report, Allens, based in Siloam Springs, Arkansas, asked that competing bids be initially submitted by Jan. 14 for a Jan. 21 auction followed by a hearing on Jan. 24 to approve a sale. Originally, Allens wanted the bankruptcy judge in Fayetteville, Arkansas, to hold a hearing last week and approve a $5 million breakup fee and $1.5 million in expense reimbursement if Marion, New York-based Seneca is outbid. Holders of $65 million in second-lien debt, including affiliates of Sankaty Advisors LLC, successfully opposed quick approval of the breakup fee. Affiliated with Bain Capital Partners LLC, Sankaty said Allens failed to meet a Dec. 10 deadline for producing a so-called stalking horse, or initial bidder, eligible for such a fee. Allens previously said three potential buyers were in talks about being the stalking horse. The bankruptcy is being financed with a $105 million on a revolving credit and $14.2 million on a term loan from Bank of America NA as agent. The loan financing the Chapter 11 reorganization, begun in late October, requires a hearing to approve a sale by Jan. 27. Allens has four processing plants and six warehouses, encumbered with $178 million in secured debt and $101.9 million owing to unsecured trade suppliers, according to court filings. Secured debt includes a first-lien, $96.5 million revolving credit and a $14 million term loan with Bank of America. There is a second-lien note for $65.6 million. About Allens Inc. Siloam Springs, Arkansas-based Allens, Inc., a maker of canned and frozen vegetables in business since 1926, filed for bankruptcy (Bankr. W.D. Ark. Case No. 13-73597) on Oct. 28, 2013, seeking to sell some divisions or reorganize as a new company. The Debtors' proposed counsel are Stan D. Smith, Esq., Lance R. Miller, Esq., and Chris A. McNulty, Esq., at Mitchell, Williams, Selig, Gates & Woodyard, P.L.L.C., in Little Rock, Arkansas; and Nancy A. Mitchell, Esq., Maria J. DiConza, Esq., and Matthew L. Hinker, Esq., at Greenberg Traurig, LLP, in New York. Jonathan Hickman of Alvarez & Marsal North America, LLC, serves as the Debtors' chief restructuring officer. Cary Daniel, Nick Campbell and Markus Lahrkamp of A& serve as assistant CROs. Lazard Freres & Co. LLC and Lazard Middle Market LLC serve as investment bankers, while GA Keen Realty Advisors, LLC, serves as real estate advisor to the Debtors. APOLLO MEDICAL: Incurs $1 Million Net Loss in Third Quarter ----------------------------------------------------------- Apollo Medical Holdings, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $1.01 million on $2.60 million of net revenues for the three months ended Oct. 31, 2013, as compared with a net loss of $4.72 million on $1.96 million of net revenues for the same period a year ago. For the nine months ended Oct. 31, 2013, the Company reported a net loss of $3.39 million on $7.64 million of net revenues as compared with a net loss of $8.08 million on $5.24 million of net revenues for the same period during the prior year. The Company's balance sheet at Oct. 31, 2013, showed $3.24 million in total assets, $4.29 million in total liabilities and a $1.04 million total stockholders' deficit. A copy of the Form 10-Q is available for free at: http://is.gd/HkMQ7J About Apollo Medical Glendale, Calif.-based Apollo Medical Holdings, Inc., provides hospitalist services in the Greater Los Angeles, California area. Hospitalist medicine is organized around the admission and care of patients in an inpatient facility such as a hospital or skilled nursing facility and is focused on providing, managing and coordinating the care of hospitalized patients. Kabani & Company, Inc., in Los Angeles, California, issued a "going concern qualification on the consolidated financial statements for the fiscal year ended Jan. 31, 2013. The independent auditors noted that the Company had a loss from operations of $2,078,487 for the year ended Jan. 31, 2013, and had an accumulated deficit of $11,022,272 as of Jan. 31, 2013. These factors raise substantial doubt about the Company's ability to continue as a going concern. Apollo Medical reported a net loss of $8.90 million on $7.77 million of net revenues for the year ended Jan. 31, 2013, as compared with a net loss of $720,346 on $5.11 million of net revenues for the year ended Jan. 31, 2012. ASR CONSTRUCTORS: May Hire Rodgers Anderson as Accountant --------------------------------------------------------- ASR Constructors, Inc., has obtained authorization from the U.S. Bankruptcy Court for the Central District of California to employ Rodgers, Anderson, Malody & Scott LLP CPAs as accountant. As reported by the Troubled Company Reporter on Nov. 19, 2013, Rodgers Anderson will, among other things, prepare the Debtor's annual federal and state income tax returns and if necessary, assist the Debtor in resolution of tax matters. Peter C. Anderson, the United States Trustee for Region 16, said that because the firm is a prepetition creditor, it is not disinterested and is ineligible to be employed by the estate. The employment application states the firm is owed $40,126 for prepetition services. ASR Constructors, Inc., filed a Chapter 11 petition (Bankr. C.D. Cal. Case No. 13-25794) on Sept. 20, 2013. The petition was signed by Alan Regotti as president. The Debtor estimated assets and debts of at least $10 million. Judge Mark D. Houle presides over the case. James C Bastian, Jr., Esq., at Shulman Hodges & Bastian, LLP, serves as the Debtor's counsel. ATLANTIC COAST FIN'L: Atlanta Fed Okays Hogan Appointment as CFO ---------------------------------------------------------------- The Federal Reserve Bank of Atlanta notified Atlantic Coast Financial Corporation that it did not have any objection to the appointment of Mr. James D. Hogan as executive vice president, chief financial officer and a director of the Company. Mr. Hogan began his service as executive vice president, chief financial officer and a director of the Company effective Dec. 19, 2013. 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. 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. CDT HORMIGUEROS: Case Summary & 23 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: CDT Hormigueros Preventive Medicine, Inc. Munoz Rivera #2 Hormigueros, PR 00660 Case No.: 13-10723 Chapter 11 Petition Date: December 23, 2013 Court: United States Bankruptcy Court District of Puerto Rico (Ponce) Debtor's Counsel: Alexis Fuentes Hernandez, Esq. FUENTES LAW OFFICES, LLC Po Box 9022726 San Juan, PR 00902-2726 Tel: (787) 722-5216 Fax: (787) 722-5206 Email: alex@fuentes-law.com Total Assets: $1.85 million Total Liabilities: $1.67 million The petition was signed by Dr. Carlos J. Miranda, president. A list of the Debtor's 23 largest unsecured creditors is available for free at http://bankrupt.com/misc/prb13-10723.pdf CHA CHA ENTERPRISES: Has Nod to Use Cash Collateral Until Jan. 12 ----------------------------------------------------------------- The Hon. Arthur S. Weissbrodt of the U.S. Bankruptcy Court for the Northern District of California issued an eighth interim order, authorizing Cha Cha Enterprises, LLC, to use the cash collateral of Wells Fargo Bank, N.A., until Jan. 12, 2014. As adequate protection for the Debtor's use of cash collateral, the Debtor will make these adequate protection payments to the Bank: (1) on Jan. 2, 2014, the amount equal to the sum of (i) the monthly payment of principal and interest at the non- default rate that will be due and owing by the Debtor to the Bank pursuant to (a) the term note dated May 15, 2006, in the original principal amount of $10 million; (b) the term note dated April 1, 2009, in the original principal amount of $3.26 million; (c) the term note dated Jan. 22, 2010, in the original principal amount of $3.37 million; and (d) the term note dated Jan. 22, 2010, in the original principal amount of $1.06 million, each made by the Debtor to the order of the Bank, on that payment date; and (ii) monthly payment required to be paid by the Debtor to the Bank pursuant to the swap documents executed by the Debtor in favor of the Bank for Trade Nos. 89372, 518708, 611495, and 611496, on that payment date; and (2) on certain dates and in amounts to be specified, any further adequate protection payments required to be made pursuant to any further interim cash collateral order. As further adequate protection, the Bank has been granted a valid, non-avoidable, and fully perfected replacement lien in the replacement collateral, or all property of the same type as the prepetition collateral acquired by the Debtor on or after the Petition Date, to secure any diminution in value of any of the prepetition collateral. In addition to the continuation of the replacement lien, the Bank will continue to be entitled to an administrative expense claim with a superpriority status. A copy of the budget is available for free at: http://bankrupt.com/misc/CHACHAcashcoll8budget.pdf About Cha Cha Enterprises Cha Cha Enterprises, LLC, is a California limited liability company formed in 1998 to purchase a fee interest in property located at 1775 Story Road, San Jose, California and a leasehold interest in property located at 1745 Story Road in San Jose. Cha Cha's primary business is the rental of real property. Cha Cha filed a Chapter 11 petition (Bankr. N.D. Cal. Case No. 13-53894) on July 22, 2013. The Debtor estimated at least $10 million in assets and liabilities. An affiliate, Mi Pueblo San Jose, Inc., sought Chapter 11 protection (Case No. 13-53893) on the same day. The cases are not jointly administered. Steven H. Felderstein, Esq., at Felderstein Fitzgerald Willoughby & Pascuzzi LLP serves as counsel. Nicolas De Lancie, Esq., at Jeffer Mangels Butler & Mitchell LLP Robert B. Kaplan, P.C. represents secured creditor Wells Fargo Bank, N.A. COLEMAN CABLE: S&P Puts 'B+' CCR on CreditWatch Developing ---------------------------------------------------------- Standard & Poor's Ratings Services said it placed its ratings, including its 'B+' corporate credit rating, on electrical wire and cable processor Coleman Cable Inc. on CreditWatch with developing implications. The CreditWatch developing listing means S&P could affirm, raise, or lower the ratings following its review. The CreditWatch listing follows the announcement that Southwire Co. (unrated) signed a definitive agreement to acquire Waukegan, Ill.-based Coleman Cable. The transaction is expected to close in the first quarter of 2014. The CreditWatch developing listing reflects the potential for Standard & Poor's to affirm, raise, or lower the corporate credit and issue level ratings for Coleman, depending on S&P's assessment of the changes from this transaction on the company's financial risk and business risk profiles, including its ownership structure, diversity, capital structure, financial policy, and liquidity profile. Coleman Cable Inc. designs, develops, manufactures, and supplies electrical wire and cable products for consumer, commercial, and industrial applications in the U.S., Honduras, and Canada. The company operates three segments: distribution, original equipment manufacturers (OEM), and engineered solutions. Coleman's products are sold to end users in the industrial, energy, electronic, construction, and transportation industries. The company was founded in 1970. In resolving the CreditWatch listing, Standard & Poor's expects to meet with management and assess the company's capital structure after the close of transaction. "We could raise the corporate credit rating if Coleman's financial profile after the transaction results in credit measures and a business risk profile more consistent with a higher rating," said Standard & Poor's credit analyst Marie Shmaruk. "Alternatively, if the proposed transaction leads to a meaningful deterioration of the financial profile, we could lower than rating. We could affirm the ratings if the company's financial measures remain in a range we believe is consistent with a 'B+' rating." COLLEGE WAY: Sec. 341(a) Creditors' Meeting Set for Jan. 15 ----------------------------------------------------------- A meeting of creditors in the bankruptcy case of College Way Commercial Plaza, LLC, will be held on Jan. 15, 2014, at 12:30 PM at Courtroom J, Union Station. 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. College Way Commercial Plaza, LLC, filed a Chapter 11 bankruptcy petition (Bankr. W.D. Wash Case No. 13-47724) on Dec. 19, 2013. The petition was signed by Sherwood B Korssjoen as member and manager. The Debtor estimated assets and debts of at least $10 million. Masafumi Iwama, Esq., at Iwama Law Firm, serves as the Debtor's counsel. Judge Brian D Lynch presides over the case. COMMUNITYONE BANCORP: Director to Retire for Personal Reasons ------------------------------------------------------------- Louis A. "Jerry" Schmitt, a director of CommunityOne Bancorp and its bank subsidiary, CommunityOne Bank, N.A., announced his retirement from the board of directors of CommunityOne Bancorp and CommunityOne Bank, N.A., effective Dec. 31, 2013. Mr. Schmitt has served as a director of CommunityOne Bancorp and CommunityOne Bank, N.A., since its recapitalization on Oct. 21, 2011, and was a member of the Risk Management Committee and the Compensation and Nominating Committee, serving as the Chair until October 2013. Mr. Schmitt's retirement was for personal reasons, and not because of a disagreement with CommunityOne Bancorp, CommunityOne Bank N.A., or their respective boards of directors. About CommunityOne CommunityOne Bancorp (formerly FNB United) is the North Carolina- based bank holding company for CommunityOne Bank, N.A. (community1.com), which offers a full range of consumer, mortgage and business banking services, including loan, deposit, cash management, wealth and online banking services through 55 branches in 44 communities throughout the central, southern and western regions of the state. FNB United incurred a net loss of $40 million in 2012, a net loss of $137.31 in 2011, and a net loss of $131.82 million in 2010. The Company's balance sheet at Sept. 30, 2013, showed $2.03 billion in total assets, $1.95 billion in total liabilities and $80.80 million in total shareholders' equity. CONSTAR INTERNATIONAL: Returns to Chapter 11; Has $14MM Financing ----------------------------------------------------------------- Peg Brickley, writing for Daily Bankruptcy Review, reported that plastic-container maker Constar International Holdings LLC returned to bankruptcy for the third time and is marching toward the auction block. According to the report, Constar nearly averted a shutdown in the days before the filing, which saw most of its board of directors resign after some shareholders balked at the Chapter 11 filing that prospective purchaser Amcor Rigid Plastics USA Inc. required as a condition of moving ahead with its $68.5 million proposed acquisition, court papers said. Shareholders ultimately consented to the bankruptcy filing, an effort to address some $123 million in funded debt, most of it debts Constar carried with it out of the previous Chapter 11 proceeding, the DBR report related. To fund its new bankruptcy sale effort, Constar has an offer of $14 million of new financing from some of its existing backers, court papers said, the DBR report further related. Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Constar got interim approval of the financing on Dec. 20. Owned by an assortment of former creditors, including hedge funds managed by Solus Alternative Asset Management LP, Black Diamond Capital Management LLC and J.P. Morgan Chase & Co., Constar has lined up a so-called "stalking-horse" bid from Amcor for its U.S. assets, court filings said, according to the DBR report. A stalking-horse bidder is one that would commit to buy the assets at a set price, putting a floor on the auction. According to the Bloomberg report, a bankruptcy judge in Delaware will consider a timetable for auctioning off the business at a hearing on Jan. 9. Wells Fargo Capital Finance NA, as agent for revolving-credit lenders owed $20 million, is continuing the facility. In addition, some of the lenders on the pre-bankruptcy term loan are providing $56 million in financing to come ahead of existing debt. The new term loan will have $14 million in fresh cash, with $7 million to be advanced along with interim borrowing approval given by the court on Dec. 20. The second segment of $7 million in new money will be available when final loan approval is given following a Jan. 9 hearing. The new term loan also converts $42 million of existing debt into a post-bankruptcy obligation. About Constar International Privately-held Constar International Holdings and nine affiliated debtors filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-13281) on Dec. 19, 2013. The company, which manufactures plastic containers, is represented by Robert S. Brady of Young, Conaway, Stargatt & Taylor. This is Constar International's third bankruptcy. Constar first filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-13432) in December 2008, with a pre-negotiated Chapter 11 Plan and emerged from bankruptcy in May 2009. Constar and its affiliates returned to Chapter 11 protection (Bankr. D. Del. Case No. 11-10109) on Jan. 11, 2011, with a pre-negotiated Chapter 11 plan and emerged from bankruptcy in June 2011. The new petition listed assets worth less than $100 million against $123 million on three layers of secured debt. CONSTAR INTERNATIONAL: Meeting to Form Creditors' Panel on Jan. 3 ----------------------------------------------------------------- Roberta A. DeAngelis, United States Trustee for Region 3, will hold an organizational meeting on Jan. 3, 2014, at 10:00 a.m. in the bankruptcy case of Constar International Holdings, LLC, et al. The meeting will be held at: J. Caleb Boggs Federal Building 844 King St., Room 2112 Wilmington, DE 19801 The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' case. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. About Constar International Privately-held Constar International Holdings and nine affiliated debtors filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-13281) on Dec. 19, 2013. The company, which manufactures plastic containers, is represented by Robert S. Brady of Young, Conaway, Stargatt & Taylor. This is Constar International's third bankruptcy. Constar first filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-13432) in December 2008, with a pre-negotiated Chapter 11 Plan and emerged from bankruptcy in May 2009. Constar and its affiliates returned to Chapter 11 protection (Bankr. D. Del. Case No. 11-10109) on Jan. 11, 2011, with a pre-negotiated Chapter 11 plan and emerged from bankruptcy in June 2011. CONSTAR INTERNATIONAL: Sec. 341(a) Creditors' Meeting on Jan. 28 ---------------------------------------------------------------- A meeting of creditors in the bankruptcy case of Constar International Holdings LLC will be held Jan. 28, 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. Constar International Holdings LLC and nine of its affiliates filed separate Chapter 11 bankruptcy petitions (Bankr. D.Del. Case Nos. 13-13281 to 13-13290) on Dec. 19, 2013. The petitions were signed by Louis Imbrogno as chief executive officer and president. The Debtors estimated assets of at least $50 million and liabilities of at least $100 million. Young, Conaway, Stargatt & Taylor, LLP, serves as the Debtors' counsel. Lincoln Partners Advisors LLC acts as the Debtors' financial advisor. Prime Clerk LLC is the Debtors' claims and noticing agent. Judge Christopher S. Sontchi presides over the cases. COYOTE MOON: Section 341(a) Meeting Scheduled for Jan. 28 --------------------------------------------------------- A meeting of creditors in the bankruptcy case of Coyote Moon L.P. will be held on Jan. 28, 2014, at 2:30 p.m. at RM 720, 3801 University Ave., Riverside, CA 92501. 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. San Bernardino, California-based Coyote Moon L.P. filed a Chapter 11 bankruptcy petition (Bankr. C.D. Cal. Case No. 13-30080) in Riverside, California, on Dec. 17, 2013. The Debtor estimated assets of at least $10 million and liabilities of between $1 million and $10 million. Gil Rodriguez, Jr., signed the petition as general partner. Stephen R Wade, Esq., at The Law Offices of Stephen R Wade serves as the Debtor's counsel. Judge Wayne E. Johnson presides over the case. DETROIT, MI: City, Banks Agree to Further Cut Termination Amount ---------------------------------------------------------------- The City of Detroit on Dec. 24 disclosed that following two days of intense negotiations with a federal mediator, the City and the banks that underwrote a controversial pension funding plan have agreed to further reduce the termination amount to $165 million. The agreement, which must still be approved by federal bankruptcy Judge Steven Rhodes, would remove a major hurdle to Detroit's continued restructuring and turnaround efforts. The deal on the pension funding instruments will free up the City's casino revenue -- about $15 million a month -- to be used on rebuilding and improving basic services for its 700,000 residents and it closes the chapter on a financial deal that helped drive the city to insolvency. "This is an important development for the City and its residents because it means we can start moving forward on implementing needed investments in public safety and services," Emergency Manager Kevyn Orr said. "This agreement represents a significant reduction from the original deal struck with the banks. The banks and the City, through mediation, and with the mediator's recommendation, have accepted the reduction in terms." Originally, the banks -- Bank of America Merrill Lynch and UBS -- had agreed to terminate the City's debt on the pension deals for $230 million, which represented approximately a 25-percent reduction from the $293.3 million the City owed on the secured debt. The Dec. 24 deal put the savings to the city at $128 million, or 43 percent of the original amount owed. To pay the banks, the City has secured $350 million in post- petition financing loan through Barclays. As a result of the mediation deal on Dec. 24, the City has agreed to lower the post- petition financing loan to $285 million: $165 million to the termination amount to the banks and $120 million cash to the City to fund immediate improvements to basic city services. The termination agreement and the revised post-petition financing loan must be approved by Judge Rhodes at a hearing scheduled for Jan. 3, 2014. Chief U.S. District Judge Gerald Rosen led the mediation negotiation. Deal Reached to End Interest-Rate Swaps Reuters reported that Detroit reached an agreement on Dec. 24 with two banks to end a costly interest-rate swap agreement, a significant step as the city negotiates with creditors to put together a plan to exit the largest municipal bankruptcy in U.S. history. According to the report, Detroit will pay $165 million, plus up to $4.2 million in costs, to end the interest-rate swap agreements with UBS AG and Bank of America Corp's Merrill Lynch Capital Services at a 43 percent discount. The new agreement, which was reached after the judge overseeing the case implored the city to negotiate better terms than it first proposed, will save the city about $65 million. As part of the arrangement, Detroit will also take out a $285 million loan from Barclays PLC to pay to end the swaps, the report related. It will use $120 million of that toward improvements to services in the city, which is hampered by $18.5 billion in debt. Terms of the agreement were announced by Robert Hertzberg, Esq. -- hertzberg@pepperlaw.com -- of the law firm Pepper Hamilton, which represents Detroit, before U.S. District Judge Gerald Rosen, the chief mediator in the bankruptcy case, the report said. The deal must still be approved by the U.S. bankruptcy judge overseeing the case, Steven Rhodes. Robert Gordon, an attorney representing the city's two pension funds, said the funds would continue to oppose the deal even with the changes. "The revised deal is better, but that is not saying a lot," Gordon, of the law firm Clark Hill, wrote in an email. 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: Bankruptcy Judge Bars Appeal in Civil Rights Case -------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that before Detroit filed for bankruptcy, the city would arrest every customer in a bar and seize their cars if the tavern didn't have a liquor license. According to the report, the practice resulted in a civil-rights lawsuit in federal district court, where a judge found that the raids were unconstitutional. The city conceded the raids were improper and has changed its practices, appealing only that part of the judgment which found individual police officers didn't have qualified immunity from monetary damages. The appeal had been fully briefed when July's bankruptcy filing brought the proceeding to a halt. U.S. Bankruptcy Judge Steven Rhodes denied the plaintiffs' request to let the appeal proceed, saying the city's concessions mean that the public interest already "has largely been vindicated." Proceeding with the appeal would gain the plaintiffs nothing, because they only have claims in the bankruptcy, Judge Rhodes said. The judge did leave the door open a crack, giving the plaintiffs a month to better explain why the public interest would be served by allowing the appeal. 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: Now Has Official Creditors' Committee in Chapter 9 --------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Detroit now has an official committee of unsecured creditors to complement the retiree committee previously formed. According to the report, the U.S. Trustee has named five creditors to the committee, including two retirement systems, Financial Guaranty Insurance Co., Wilmington Trust Co. and a city worker. Detroit also negotiated a revised settlement where the city will pay $165 million rather than $230 million to terminate a swap agreement. The reduction allows Detroit to invest $120 million in infrastructure while reducing a loan from $350 million to $285 million. 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. DOLPHIN BAY: Sec. 341(a) Creditors' Meeting Scheduled for Jan. 15 ----------------------------------------------------------------- A meeting of creditors in the bankruptcy case of Dolphin Bay Developers, Inc., will be held on Jan. 15, 2014, at 2:30 p.m. at 1515 N Flagler Dr Room 870, West Palm Beach. Creditors have until April 15, 2014, to submit their proofs of claim. 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. Dolphin Bay Developers, Inc., filed a Chapter 11 bankruptcy petition (Bankr. S.D. Fla. Case No. 13-40027) on Dec. 19, 2013. David Ross signed the petition as president. The Debtor estimated assets of at least $10 million and liabilities of at least $1 million. Philip J Landau, Esq., serves as the Debtor's counsel. The case is assigned to Judge Paul G. Hyman Jr. DYNASIL CORP: Incurs $8.7 Million Net Loss in Fiscal 2013 --------------------------------------------------------- Dynasil Corporation of America filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K disclosing a net loss of $8.72 million on $42.75 million of net revenue for the year ended Sept. 30, 2013, as compared with a net loss of $4.30 million on $47.88 million of net revenue during the prior year. As of Sept. 30, 2013, the Company had $26.67 million in total assets, $16.03 million in total liabilities and $10.64 million in total stockholders' equity. McGladrey LLP, in Boston, Massachusetts, issued a "going concern" qualification on the consolidated financial statements for the year ended Sept. 30, 2013. The independent auditors noted that the Company is in default with the financial covenants set forth in the terms of its outstanding loan agreements (and may enter into a forbearance arrangement with its lenders) and has sustained substantial losses from operations for the years ended Sept. 30, 2013, and 2012. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern. Bankruptcy Warning "As of September 30, 2013 and September 30, 2012, we were in default of certain covenants under our loan agreement with Santander Bank, N.A. ("Santander") and our note agreement with Massachusetts Capital Resource Company ("MCRC"), which is subordinated to the Santander Bank loan. This indebtedness is secured by substantially all of our assets and is guaranteed by our subsidiaries. Our debt agreements include financial covenants which require us to maintain compliance with certain financial ratios during the term of the agreements. Failure to comply with the financial covenants is an event of default under the debt agreements. In an event of default, each of the lenders has the right to accelerate repayment of all outstanding indebtedness, impose a higher default interest rate and (in the case of Santander Bank) take any and all action, at its sole option, to collect monies owed to it, including to enforce and foreclose on its security interest on all of our assets. While we continue to be current with all principal and interest payments with Santander, we have not paid approximately $0.3 million in interest owed to MCRC. Additionally, as of both September 30, 2012 and 2013 and as of the date hereof, we were in violation of certain financial covenants contained in each of the loan agreements that require us to maintain certain ratios of earnings before interest, taxes, depreciation and amortization to fixed charges and to total/senior debt. "If our lenders were to accelerate our debt payments, our assets may not be sufficient to fully repay the debt and we may not be able to obtain capital from other sources at favorable terms or at all. If additional funding is required, this funding may not be available on favorable terms, if at all, or without potentially very substantial dilution to our stockholders. If we do not raise the necessary funds, we may need to curtail or cease our operations, sell certain assets and/or file for bankruptcy, which would have a material adverse effect on our financial condition and results of operations," the Company said in the Annual Report. A copy of the Form 10-K is available for free at: http://is.gd/fkSCe9 About Dynasil Watertown, Mass.-based Dynasil Corporation of America (NASDAQ: DYSL) -- http://www.dynasil.com/-- develops and manufactures detection and analysis technology, precision instruments and optical components for the homeland security, medical and industrial markets. ELEPHANT TALK: Stockholders Elect Three Directors ------------------------------------------------- Elephant Talk Communications Corp. held its annual meeting of stockholders on Dec. 18, 2013, during which the stockholders: (a) elected Steven van der Velden, Johan Dejager, and Rijkman Groenink as directors of the Company to hold office until the next annual meeting of stockholders and until their successors will be elected; (b) approved the issuance of the warrant to the Company's Chairman and chief executive officer, Steven van der Velden, in connection with his participation in a financing of the Company: (c) approved the 2008 Plan and re-approved the performance criteria thereunder; and (d) ratified the appointment of BDO USA, LLP, as the Company's independent registered public accounting firm for the fiscal year ending Dec. 31, 2013. Mr. Levine indicated by e-mail correspondence on Dec. 17, 2013, that he intended to abide by the Company's stockholders' wishes and resign from the Board. On the Annual Meeting Date, Mr. Levine submitted his written resignation from the Board. On the Annual Meeting Date, Mr. Levine was the Chairman of the Compensation Committee and also served on the Audit and Finance Committee and the Nominating and Corporate Governance Committee. In his e-mail correspondence to the Company, Mr. Levine stated his resignation is based on his differences with the management of the Company and certain minority stockholders regarding the roles and responsibilities of the independent directors on the Board. The 2008 Plan, among other things, increases the maximum number of shares of the Company's common stock available for issuance under the 2008 plan by 23,000,000 to 46,000,000. About Elephant Talk Lutz, Fla.-based Elephant Talk Communications, Inc. (OTC BB: ETAK) -- http://www.elephanttalk.com/-- is an international provider of business software and services to the telecommunications and financial services industry. Elephant Talk disclosed a net loss attributable to the Company of $23.13 million in 2012, a net loss attributable to the Company of $25.31 million in 2011 and a net loss attributable to the Company of $92.48 million in 2010. The Company's balance sheet at Sept. 30, 2013, showed $46.45 million in total assets, $22.53 million in total liabilities and $23.91 million in total stockholders' equity. BDO USA, LLP, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012. The independent auditors noted that the Company has suffered recurring losses from operations has an accumulated deficit of $203.3 million and continues to generate negative cash flows that raise substantial doubt about its ability to continue as a going concern. F & H ACQUISITION: Meeting to Form Creditors' Panel on Jan. 3 ------------------------------------------------------------- Roberta A. DeAngelis, United States Trustee for Region 3, will hold an organizational meeting on Jan. 3, 2014, at 10:00 a.m. in the bankruptcy case of F&H Acquisition Corp. The meeting will be held at: The DoubleTree Hotel 700 King Street Wilmington, DE 19801 The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' case. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. The owner of the Fox & Hound, Champps, and Bailey's Sports Grille casual dining restaurants filed a Chapter 11 petition on Dec. 16 in Delaware designed to sell the operation at auction on March 4. The parent holding company, F&H Acquisition Corp., is based in Wichita, Kansas. The case is In re F&H Acquisition Corp., 13-bk-13220, U.S. Bankruptcy Court, District of Delaware (Wilmington). FAIRMONT GENERAL: Expects Buyer or Investor in March ---------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Fairmont General Hospital Inc., a 207-bed acute-care facility in Fairmont, West Virginia, is asking for an expansion of the exclusive right to propose a plan. According to the report, unless a creditor objects in the next three weeks, exclusive plan-filing rights will be extended until April 1. The hospital said its investment bankers are looking for a "buyer or strategic partner." Fairmont expects the process will be complete by March, allowing a plan to be filed at that time. About Fairmont General Fairmont General Hospital Inc. and Fairmont Physicians, Inc., which operate a 207-bed acute-care facility in Fairmont, West Virginia, sought Chapter 11 bankruptcy protection (Bankr. N.D. W.Va. Case No. 13-01054) on Sept. 3, 2013, listing between $10 million and $50 million in both assets and debts. The fourth-largest employer in Marion County, West Virginia, filed for bankruptcy as it looks to partner with another hospital or health system. The Debtors are represented by Rayford K. Adams, III, Esq., and Casey H. Howard, Esq., at Spilman Thomas & Battle, PLLC, in Winston-Salem, North Carolina; David R. Croft, Esq., at Spilman Thomas & Battle, PLLC, in Wheeling, West Virginia, and Michael S. Garrison, Esq., at Spilman Thomas & Battle, PLLC, in Morgantown, West Virginia. The Debtors' financial analyst is Gleason & Associates, P.C. The Debtors' claims and noticing agent is Epiq Bankruptcy Solutions. UMB Bank is represented by Nathan F. Coco, Esq., and Suzanne Jett Trowbridge, Esq., at McDermott Will & Emery LLP. The Committee of Unsecured Creditors is represented by Andrew Sherman, Esq., and Boris I. Mankovetskiy, Esq., at Sills Cummis & Gross P.C. and Kirk B. Burkley, Esq., Bernstein Burkley, P.C. Janet Smith Holbrook, Esq., at Huddleston Bolen LLP, represents the Committee as local counsel. FIRSTLIGHT HYDRO: Fails to Receive Bondholders' Consent ------------------------------------------------------- FirstLight Hydro Generating Company on Dec. 23 disclosed that it did not receive the consents necessary to effect the proposed amendments and the proposed waiver to the indenture governing the Issuer's $320,000,000 outstanding 8.812% Series B Senior Secured Bonds due 2026. The consent solicitation expired at 5:00 p.m. New York City time on December 20, 2013. Headquartered in Hartford, Connecticut, FirstLight Hydro Generating Company provides pumped storage and conventional hydroelectric power in the northeastern United States. FISKER AUTOMOTIVE: Plan Approval May Be Delayed by Workers' Claims ------------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that although Fisker Automotive Inc. has a confirmation hearing on Jan. 3 for approval of a Chapter 11 plan, it looks as though the one-time electric carmaker won't be exiting bankruptcy so quickly as a result of $3.8 million in priority claims filed by workers fired without required 60 days' notice. According to the report, Fisker filed for Chapter 11 protection on Nov. 22, immediately after Hybrid Tech Holdings LLC bought the $168.5 million secured loan made by the U.S. Department of Energy. As part of a reorganization plan filed alongside the Chapter 11 petition, Hybrid Tech would buy the assets in exchange for $75 million of the government loan. It will also supply $725,000 cash for distribution to creditors under the liquidating plan. In addition, the buyer will waive the $8 million loan to finance bankruptcy. Fisker filed papers on Dec. 19 importuning the bankruptcy judge to rule on a tentative basis that the workers have no valid claims. U.S. Bankruptcy Judge Kevin Gross the next day rebuffed Fisker's effort at knocking out the claims at the Jan. 3 confirmation hearing. Judge Gross said Fisker was seeking "oppressive relief" by trying to extinguish the claims so quickly when the workers first sued in April. Judge Gross said he has "expressed concern on several occasions" about the "compressed schedule for confirmation." Fisker said in its papers last week that the workers' claim is $3.8 million, including $2 million that must be paid in full in cash if it's a valid priority claim. Unless the claim is knocked out, Fisker said, there won't be "any Chapter 11 plan" in view of the requirement to pay priority claims in full to merit plan confirmation. The company contends the claim is invalid under the "faltering company and unforeseen business circumstances exceptions" to the so-called Warn Act that gives wage claims to workers filed without required notice. The plan would give a 1 percent recovery to unsecured creditors with about $320 million in claims. The cash comes from Hybrid Tech, although only if the class votes for the plan. Similarly, Hybrid Tech will waive its unsecured deficiency claim only if the class votes "yes." The disclosure statement, approved tentatively this month, doesn't specify the percentage recovery by Hybrid Tech. About Fisker Automotive Fisker Automotive Holdings, Inc., developer of the Karma plug-in hybrid electric sedan, filed a petition for Chapter 11 protection (Bankr. D. Del. Case No. 13-13087) on Nov. 22, 2013, with plans to sell the business to Hybrid Tech Holdings, LLC. Fisker estimated assets of more than $100 million and listed debt of $500 million in its bankruptcy petition. The assets include an assembly plant purchased for $21 million from General Motors Corp. The plant never operated. The cars were assembled in Finland. Fisker now has 21 employees. Fisker received a $529 million loan from the Department of Energy's Advanced Technology Vehicles Manufacturing Loan Program and drew down about $192 million before the department froze the loan after Fisker failed to hit several development targets. The company defaulted on its loan in April 2013. The Debtors have tapped James H.M. Sprayregen, P.C., Esq., Anyp Sathy, P.C., Esq., and Ryan Preston Dahl, Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, as co-counsel; Laura Davis Jones, Esq., James E. O'Neill, Esq., and Peter J. Keane, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, as co- counsel; Beilinson Advisory Group as restructuring advisors; and Rust Consulting/Omni Bankruptcy, as notice and claims agent and administrative advisor. The Debtors disclosed that they have entered into an asset purchase agreement with Hybrid for the sale of substantially all of its assets. Hybrid is represented by Tobias Keller, Esq., and Peter Benvenutti, Esq., at Keller & Benvenutti LLP, in San Francisco, California. FNBH BANCORP: Moross LP No Longer Holds Shares ---------------------------------------------- In an amended Schedule 13D filed with the U.S. Securities and Exchange Commission, Moross Limited Partnership disclosed that as of Dec. 11, 2013, it no longer owns any securities issued by FNBH Bancorp Inc. On Dec. 11, 2013, Moross Limited sold its entire interest in the Company (comprised of 51,743 shares of Common Stock) to Stanley B. Dickson for an aggregate purchase price of $36,220. A copy of the regulatory filing is available at: http://is.gd/ykGLT4 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." FNBH BANCORP: Stanley Dickson Held 43.5% Stake at Dec. 11 --------------------------------------------------------- In a Schedule 13D filed with the U.S. Securities and Exchange Commission, Stanley B. Dickson, Jr., disclosed that as of Dec. 11, 2013, it beneficially owned 10,766,028 shares of common stock of FNBH Bancorp Inc. representing 43.5 percent of the shares outstanding. Mr. Dickson purchased 51,743 shares of Common Stock from Moross L.P. for a total purchase price of $36,220. Mr. Dickson also purchased 7,500 shares of Series B Preferred Stock from the Company for a total net purchase price of $7,050,000. The source of funding for both transactions was the personal funds of Mr. Dickson. A copy of the regulatory filing is available for free at: http://is.gd/SCY9QN 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." FNBH BANCORP: Steven Dickson Held 7.5% Equity Stake at Dec. 11 -------------------------------------------------------------- In a Schedule 13G filed with the U.S. Securities and Exchange Commission, Steven Dickson disclosed that as of Dec. 11, 2013, he beneficially owned 1,866,071 shares of common stock of FNBH Bancorp, Inc., representing 7.5 percent of the shares outstanding. A copy of the regulatory filing is available for free at http://is.gd/AONnJA 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." FPL ENERGY: S&P Raises Rating on $365MM Sr. Sec. Bonds to 'BB' -------------------------------------------------------------- Standard & Poor's Ratings Services said it raised its rating to 'BB' from 'BB-' on FPL Energy National Wind LLC's (National Wind) $365 million senior secured bonds due 2024. The recovery rating on National Wind's senior secured bonds is now '1', indicating S&P's expectation of very high (90% to 100%) recovery if a default occurs. At the same time, S&P affirmed its 'B-' rating on FPL Energy National Wind Portfolio LLC's (Wind Portfolio) $100 million senior secured bonds due 2019 and revised the outlook to stable from negative. The recovery rating on Wind Portfolio's senior secured bonds is now '5', indicating S&P's expectation of modest (10% to 30%) recovery if a default occurs. The outlook is stable. "We raised the rating on National Wind because we believe that following the sale of its Wyoming project, National Wind's financial performance will improve substantially as it will redeem a significant portion of its outstanding debt," said Standard & Poor's credit analyst Jeong-A Kim. S&P affirmed the rating on Wind Portfolio because it believes that Wind Portfolio will also redeem a smaller portion of its outstanding debt and find its financial position stabilizing as it receives steady distributions from National Wind. S&P has revised its base case scenario to include a 15% increase in operating and maintenance (O&M) expenses from the management forecast, based on historical data since its revision. S&P has relied on management's reduced projected revenues in its base case, while maintaining an estimate of 97% availability because the portfolio has demonstrated historically high availability levels. Other base case assumptions remain the same. The stable outlook on National Wind reflects S&P's view of the effect of the Wyoming asset sale and its positive effect in significantly reducing National Wind's debt service. S&P could lower the rating if the project's wind resource is lower than expected or O&M expenses are higher than expected, failing its distribution test at 1.25x. S&P could consider raising the rating if O&M costs become more predictable or liquidity becomes sufficient to maintain the rating so that the average debt service coverage through maturity increases to 1.40x. The stable outlook on Wind Portfolio reflects S&P's view of its stabilizing financial condition following National Wind's improved financial profile post-Wyoming sale. S&P could lower the rating if National Wind fails its distribution test and Wind Portfolio draws on its debt service reserve. S&P could raise the rating if the debt service coverage consistently tops 1.35x due to National Wind's better performance. FRIENDFINDER NETWORKS: Emerges From Chapter 11 Bankruptcy --------------------------------------------------------- FriendFinder Networks Inc. on Dec. 23 disclosed that its plan of reorganization has become effective and the Company has emerged from bankruptcy protection. FriendFinder implemented the Chapter 11 plan on Dec. 20. The bankruptcy judge in Delaware approved the plan by signing a confirmation order four days before. The plan of reorganization becomes effective just three months after the Company filed for bankruptcy protection in order to strengthen its balance sheet and enable FriendFinder Networks to grow its flagship brands. Through this process, the Company's annual interest expense is expected to be reduced by over $50 million and approximately $300 million of secured debt will be eliminated. As part of the reorganization, the Company's shares are being deregistered and will no longer trade on the open market. FriendFinder Networks' founder and majority equity holder, Andrew Conru, is the reorganized Company's Chairman and Chief Executive Officer. Anthony Previte serves as President and Chief Operating Officer. The reorganization plan was overwhelmingly supported by the Company's stakeholders. Under the terms of the plan, the 14% Senior Secured Notes due 2013 have been exchanged for new notes in the same principal amount, plus certain cash consideration. Holders of the 11.5% Non-Cash Pay Secured Notes due 2014 and 14% Cash Pay Secured Notes due 2013 receive substantially all of the new common stock to be issued by reorganized FriendFinder Networks, plus certain cash consideration subject to compliance with certain conditions. FriendFinder Networks is being advised by the law firm of Greenberg Traurig LLP and Akerman LLP and financial advisor SSG Capital Advisors, LLC. Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the plan gives accrued interest plus an equal amount in new 14 percent first-lien notes to holders of $234.3 million in 14 percent first-lien notes. Negotiated before the bankruptcy filing in September with 80 percent of first- and second-lien lenders, the plan eliminates $300 million in secured debt by giving the new equity to holders of $330.8 million in two issues of second-lien notes. The plan pays unsecured creditors in full. The first-lien notes last traded on Dec. 13 for 109 cents on the dollar, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. About FriendFinder Networks Inc. FriendFinder Networks and affiliates, including lead debtor PMGI Holdings Inc., sought bankruptcy protection (Bankr. D. Del. Lead Case No. 13-12404) on Sept. 17, 2013, estimating assets of $465.3 million and debt totaling $662 million. The Debtors are represented by Nancy A. Mitchell. Esq., Matthew L. Hinker, Esq., and Paul T. Martin, Esq., at Greenberg Traurig, LLP, in New York, as lead bankruptcy counsel; and Dennis A. Meloro, Esq., in Wilmington, Delaware, as local Delaware counsel. Akerman Senterfitt serves as the Debtors' special and conflicts counsel. The Debtors' financial advisor is SSG Capital Advisors LLC. BMC Group, Inc., is the Debtors' claims and noticing agent. FRIENDSHIP DAIRIES: Wants McFinney & Agstar Held in Contempt ------------------------------------------------------------ Friendship Dairies asks the U.S. Bankruptcy Court for the Northern District of Texas Friendship to hold McFinney Agri-Finance LLC and its attorney-in-fact Agstar Financial Services, FLCA, in contempt for violating the automatic stay. McFinney is the owner and holder of a claim against the Debtor. AgStar is its loan servicer and attorney-in-fact. According to the Debtor, AgStar on Jan. 30, 2013, commenced a lawsuit against the Debtor's principals, Patrick VanAdrichem, Lidwina VanAdrichem, and Jakob VanDerweg in the 222nd Judicial District Court in and for Deaf Smith County, Texas. AgStar commenced the lawsuit on behalf of its principal, McFinney. The claims in the state court lawsuit brought against the Debtor's principals are based on their individual and personal liability for the same indebtedness as provides the basis for McFinney's claim against the Debtor's estate. On Sept. 18, 2013, the 222nd Judicial District Court entered judgment against the Debtor's principals, jointly and severally, in the amount of $17,057,566, plus additional interest. As a means of pursuing collection of that judgment, AgStar applied to the 222nd Judicial District Court for a charging order against the Debtor's principals' respective partnership interests in the Debtor. AgStar sought the charging order on its own behalf as McFinney's loan servicer and on McFinney's behalf as its agent and attorney-in-fact. Accordingly, the Debtor requests that the motion be set for hearing with notice to AgStar and McFinney to appear and show cause why each should not be held in contempt for violating the automatic stay and for interfering with the Court's exclusive jurisdiction over the Debtor's affairs and over the property of the bankruptcy estate. About Friendship Dairies Friendship Dairies, a general partnership, filed a Chapter 11 petition (Bankr. N.D. Tex. Case No. 12-20405) in Amarillo, Texas, on Aug. 6, 2012. The Debtor operates a dairy near Hereford, Deaf Smith County, Texas. The dairy consists of 11,000 head of cattle, fixtures and equipment. The Debtor also farms 5,000 acres of land for production of various crops used in feeding for the cattle. The Debtor owes McFinney Agri-Finance, LLC, $16 million secured by the Debtor's property, which is appraised at more than $24 million. The Debtor disclosed $44,421,851 in assets and $45,554,951 in liabilities as of the Chapter 11 filing. Bankruptcy Judge Robert L. Jones oversees the case. J. Bennett White, P.C., serves as the Debtor's counsel. The petition was signed by Patrick Van Adrichem, partner. The U.S. Trustee appointed a six-member creditors committee in the Debtor's case. The Committee tapped Levenfeld Pearlstein as lead counsel, and Mullin, Hoard & Brown as local counsel. FURNITURE BRANDS: Meredith Graham Okayed to Lead Liquidation ------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware approved the engagement agreement that FBI Wind Down, Inc., formerly known as Furniture Brands International, Inc., et al., entered into with Meredith M. Graham to liquidate the remaining company assets. The Troubled Company Reporter on Dec. 13, 2013, citing a BankruptcyData report, said the Debtors' official committee of unsecured creditors filed with the Bankruptcy Court a statement in support of the Debtors' motion for an order approving the engagement agreement with Ms. Graham, nunc pro tunc to Nov. 25, 2013. According to the statement, ". . . the Committee supports the approval of the Plan Confirmation Bonus, as an appropriate incentive to insure Ms. Graham uses her best efforts to obtain confirmation of a plan and the winding down of the Debtors' estates in an efficient and expeditious manner. If Ms. Graham is able to earn her Plan Confirmation Bonus by getting a consensual chapter 11 plan confirmed in these complicated cases within the next 4-6 months, the Committee believes that the Plan Confirmation Bonus will be creditor money well spent as her efforts will have resulted in a significant savings to creditors in reduced administrative expenses many multiples of the cost of the Plan Confirmation Bonus and will result in a quicker potential date for making distributions to creditors. This is why the Committee was willing to use what is essentially creditors' money in the first place to incentivize Ms. Graham to get a plan confirmed quickly." The TCR, citing Richard Craver at the Winston-Salem Journal, reported on Dec. 12, 2013, that Ms. Graham will be in charge of liquidating remaining company assets. Ms. Graham has served as Furniture Brands' chief administrative officer and general counsel since May. Winston-Salem Journal said Ms. Graham will be paid $286,000 a year. She also is eligible to receive a one-time bonus equal to a percentage of her base compensation if the debtors confirm a Chapter 11 plan with the U.S. Bankruptcy Court, the report related. According to the Winston-Salem Journal report, KPS Capital Partners was confirmed Nov. 22 as the top bidder for Furniture Brands' assets at $280 million. On Nov. 28, KPS announced a new name for the assets -- Heritage Home Group LLC -- and that Furniture Brands' top executive, Ralph Scozzafava, has resigned. Winston-Salem Journal said Ira Glazer, 61, a veteran corporate turnaround expert, has been named president and chief executive. Heritage Home will operate as an independent company, the report said. 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. HARI RAM: Voluntary Chapter 11 Case Summary ------------------------------------------- Debtor: Hari Ram, Inc. 350 Bent Creek Blvd. Mechanicsburg, PA 17050 Case No.: 13-06524 Chapter 11 Petition Date: December 24, 2013 Court: United States Bankruptcy Court Middle District of Pennsylvania (Harrisburg) Judge: Hon. Mary D France Debtor's Counsel: Henry W Van Eck, Esq. METTE, EVANS, & WOODSIDE 3401 North Front Street Harrisburg, PA 17110-0950 Tel: 717 232-5000 Fax: 717 236-1816 Email: hwvaneck@mette.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Kanjibhai R. Patel, president. The Debtor did not file a list of its largest unsecured creditors when it filed the petition. HOKU CORP: Washington Contractor Wins Auction for Idaho Plant ------------------------------------------------------------- Patrick Fitzgerald, writing for DBR Small Cap, reported that a U.S. bankruptcy judge approved a Washington construction company's $8.3 million bid for Hoku Corp.'s Idaho plant for manufacturing polysilicon, a key ingredient in the making of solar panels. Hoku Corp., which promised to become one of Eastern Idaho's largest employers with a proposed $700 million plant in Pocatello, went bankrupt in July 2013. In May 2012, Hoku halted construction of its Pocatello facility and laid off 100 employees after struggling to even pay its electric bill to Idaho Power. The CEO of Hoku Solar tendered his resignation shortly thereafter. Hoku filed for bankruptcy in Pocatello federal court, reporting nearly $1 billion in red ink, the report said. The plant has been shuttered and no one is allowed on the site unless authorized by a bankruptcy trustee. More than 30 separate entities have been listed at creditors. HOVNANIAN ENTERPRISES: Posts $31.3MM Net Income in Fiscal 2013 -------------------------------------------------------------- Hovnanian Enterprises, Inc., filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K disclosing net income of $31.29 million on $1.85 billion of total revenues for the year ended Oct. 31, 2013, as compared with a net loss of $66.19 million on $1.48 billion of total revenues during the prior year. As of Oct. 31, 2013, the Company had $1.75 billion in total assets, $2.19 billion in total liabilities and a $432.79 million total deficit. A copy of the Form 10-K is available for free at: http://is.gd/IVvgNc About Hovnanian Enterprises Red Bank, New Jersey-based Hovnanian Enterprises, Inc. (NYSE: HOV) -- http://www.khov.com/-- founded in 1959 by Kevork S. Hovnanian, is one of the nation's largest homebuilders with operations in Arizona, California, Delaware, Florida, Georgia, Illinois, Kentucky, Maryland, Minnesota, New Jersey, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Texas, Virginia and West Virginia. The Company's homes are marketed and sold under the trade names K. Hovnanian Homes, Matzel & Mumford, Brighton Homes, Parkwood Builders, Town & Country Homes, Oster Homes and CraftBuilt Homes. As the developer of K. Hovnanian's Four Seasons communities, the Company is also one of the nation's largest builders of active adult homes. * * * As reported by the Troubled Company Reporter on April 25, 2013, Standard & Poor's Ratings Services said it raised its corporate credit rating on Hovnanian Enterprises Inc. to 'B-' from 'CCC+'. "The upgrade reflects strengthening operating performance supported by the broader recovery in the housing market that, we believe, should support modest profitability in 2013," said Standard & Poor's credit analyst George Skoufis. In the Dec. 9, 2013, edition of the TCR, Fitch Ratings upgraded the Issuer Default Rating (IDR) of Hovnanian Enterprises to 'B-' from 'CCC'. The upgrade and the Stable Outlook reflects HOV's operating performance year-to-date (YTD), adequate liquidity position, and moderately better prospects for the housing sector during the remainder of this year and in 2014. As reported in the TCR on Aug. 5, 2013, Moody's Investors Service raised the Corporate Family Rating of Hovnanian Enterprises, Inc. to Caa1 from Caa2. The upgrade reflects both the industry's growing strength and Hovnanian's own improved results, which make it far less likely that the company will default on its debt obligations. INT'L FOREIGN EXCHANGE: CDG Group May Provide Crisis Mgmt Services ------------------------------------------------------------------ The Hon. Robert E. Gerber of the U.S. Bankruptcy Court for the Southern District of New York authorized International Foreign Exchange Concepts Holdings, Inc., et al., to employ CDG Group, LLC to provide crisis management services to the Debtors; and (ii) employ Michael Meenan, managing director of CDG, as chief restructuring officer until March 1, 2014. CDG will, among other things: a. serve as a principal contact with the Debtors' creditors with respect to the Debtors' financial and operational matters; b. gather and analyze data, interview appropriate management and evaluate the Debtors' existing liquidity, financial forecasts and budgets; and c. evaluate the feasibility of strategic alternatives being considered by the Debtors given their current operating businesses, current capital structure and business prospects. To the best of the Debtors' knowledge, Mr. Meenan has no interest adverse to the Debtors' estates with respect to the matters upon which they are to be engaged. About International Foreign Exchange International Foreign Exchange Concepts Holdings, Inc., and International Foreign Exchange Concepts, L.P., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 13-13380) on Oct. 17, 2013. Judge Robert Gerber oversees the case. Counsel to the Debtors is Henry P. Baer, Jr., Esq., at Finn Dixon & Herling LLP, in Stamford, Connecticut. The Debtors' restructuring advisors is CDG Group. The Debtors' special counsel is Withers Bergman LLP. The Debtors' notice, claims, solicitation and balloting agent is Logan & Company, Inc. Counsel to AMF-FXC Finance LLC, the DIP lender, is Michael L. Cook, Esq., and Christopher Harrison, Esq., at Schulte Roth & Zabel LLP, in New York. International Foreign Exchange Concepts, L.P. disclosed $67,833,917 in assets and $51,354,154 in liabilities as of the Chapter 11 filing. INT'L FOREIGN EXCHANGE: DiConza Taurig Okayed as Conflicts Counsel ------------------------------------------------------------------ The Hon. Robert E. Gerber of the U.S. Bankruptcy Court for the Southern District of New York authorized International Foreign Exchange Concepts Holdings, Inc., et al., to employ DiConza Traurig LLP as conflicts counsel. As reported in the Troubled Company Reporter on Dec. 6, 2013, the Debtors required DiConza Traurig to: (a) advise the Debtors concerning, and assisting in the negotiation, litigation and resolution of, Conflicts Matters relating to claims against insiders for sums due and owing, and any other potential Conflicts Matters involving insiders; (b) advise the Debtors concerning protection of their interests in Inspiration Biopharmaceuticals, Inc.; (c) advise the Debtors concerning, and taking appropriate actions with respect to, additional Conflicts Matters; (d) conduct discovery and Bankruptcy Rule 2004 examinations, as the Debtors and the Court may deem appropriate, to investigate Conflicts Matters; (e) advise concerning, and commence or respond to court proceedings as the Debtors may deem appropriate, in connection with Conflicts Matters; and (f) perform all other legal services for and on behalf of the Debtors, and at their request, which may be necessary or appropriate in connection with Conflicts Matters. Richard Milin will be the primary attorney providing services to the Debtors; his current hourly rate is $550 per hour. The current hourly rates of the other attorneys at DiConza Traurig range between $375 and $575 per hour and paralegal/law clerk rates range between $110 and $195 per hour. DiConza Traurig will also be reimbursed for reasonable out-of- pocket expenses incurred. Mr. Milin 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. About International Foreign Exchange International Foreign Exchange Concepts Holdings, Inc., and International Foreign Exchange Concepts, L.P., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 13-13380) on Oct. 17, 2013. Judge Robert Gerber oversees the case. Counsel to the Debtors is Henry P. Baer, Jr., Esq., at Finn Dixon & Herling LLP, in Stamford, Connecticut. The Debtors' restructuring advisors is CDG Group. The Debtors' special counsel is Withers Bergman LLP. The Debtors' notice, claims, solicitation and balloting agent is Logan & Company, Inc. Counsel to AMF-FXC Finance LLC, the DIP lender, is Michael L. Cook, Esq., and Christopher Harrison, Esq., at Schulte Roth & Zabel LLP, in New York. KAIDANS INC: Voluntary Chapter 11 Case Summary ---------------------------------------------- Debtor: Kaidans, Inc. d/b/a University Inn 1101 Frontage Road Oxford, MS 38655 Case No.: 13-15275 Chapter 11 Petition Date: December 24, 2013 Court: United States Bankruptcy Court Northern District of Mississippi (Aberdeen) Debtor's Counsel: Craig M. Geno, Esq., LAW OFFICES OF CRAIG M. GENO, PLLC 587 Highland Colony Parkway Ridgeland, MS 39157 Tel: 601-427-0048 Email: cmgeno@cmgenolaw.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Rajendra C. Patel, president. The Debtor did not file a list of its largest unsecured creditors when it filed the petition. KEYWELL LLC: Creditors Sue Executives Over Bankruptcy ----------------------------------------------------- Joseph Checkler, writing for DBR Small Cap, reported that creditors of Keywell LLC are suing the executives of the recently sold scrap-metal recycler, saying they engaged in self-dealing that sapped the company of resources while "lining their own pockets," eventually driving the company into bankruptcy. According to the report, in a Dec. 17 filing with U.S. Bankruptcy Court in Chicago, Keywell's official committee of unsecured creditors said that among other things, Chief Executive J. Mark Lozier, Chairman Joel D. Tauber and other executives arranged disguised equity infusions through a newly created entity from which they received "illegal" dividends. "Rather than re-investing its revenues or strengthening its capital reserves, Keywell's management (who were the largest shareholders of the company) opted to distribute the remaining value in the enterprise to Keywell's equity holders through massive dividends that would ultimately render Keywell insolvent," lawyers for the creditors said, the report cited. After a profitable 2007, Keywell executed a "special distribution," to insiders, the creditors said, which left the company "substantially undercapitalized." Mr. Lozier and 20 other Keywell executives and employees are named in the suit, as are several entities related to them, the report related. The creditors said Mr. Lozier and the others made the decision to pay themselves, "emptying the company's coffers" with hopes of future good results that never came. Lawyers for Keywell, where Mr. Lozier, Mr. Tauber and the other employees still work, didn't immediately respond to a request for comment. After getting approval on a new equity infusion from shareholders -- mostly themselves -- Keywell allegedly sent a note out to "destroy all copies" of a letter describing the proposal, according to the complaint, the report further related. That is because the company wanted to create a new entity called Newkey, which would offer the money to shareholders as a "secured loan," thus putting the money higher on the totem pole in the event of a bankruptcy. That bankruptcy eventually happened and was structured to benefit holders of the Newkey notes, creditors said. About Keywell L.L.C. Keywell L.L.C. filed a Chapter 11 petition (Bankr. N.D. Ill. Case No. 13-37603) on Sept. 24, 2013. Mark Lozier signed the petition as president and CEO. The Debtor estimated assets and debts of at least $10 million. Judge Eugene R. Wedoff presides over the case. Adelman & Gettleman Ltd. serves as the Debtor's counsel. Patzik, Frank & Samotny Ltd. serves as the Debtor's as special counsel. Eureka Capital Markets, LLC, serves as the Debtor's investment banker, while Conway MacKenzie, Inc., serves as its financial advisors. The Debtor's lenders are represented by Steven B. Towbin, Esq., and Gordon E. Gouveia, Esq., at Shaw Fishman Glantz & Towbin LLC, in Chicago, Illinois. KGB: S&P Withdraws 'B-' Corp. Credit Rating on Issuer's Request --------------------------------------------------------------- Standard & Poor's Ratings Services said it withdrew its 'B-' corporate credit rating on U.S. directory assistance and information provider kgb at the company's request. LEHMAN BROTHERS: Judge Peck Wants Intel Swap Suit in His Court -------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Intel Corp.'s dispute with Lehman Brothers Holdings Inc. over whether the chipmaker owes the defunct bank as much as $312 million on a swap agreement should be decided in bankruptcy court, U.S. Bankruptcy Judge James M.Peck said. According to the report, the month before it filed for bankruptcy in September 2008, Lehman signed a contract to buy as much as $1 billion of Intel stock, which Intel in turn was to acquire from Lehman. Intel possessed nonpublic information that could have touched off lawsuits had it purchased its own stock directly. As a consequence of Lehman's bankruptcy, Santa Clara, California- based Intel, the world's largest chipmaker, declared a termination event and glommed $1 billion in collateral that Lehman had posted as security for the transaction. Lehman sued in U.S. Bankruptcy Court in Manhattan, contending Intel used a faulty damage calculation. Judge Peck said in a Dec. 19 opinion that New York-based Lehman intends to recover at least $127 million from Intel, or as much as $312 million, using a different damage calculation. Judge Peck, who has announced his retirement, said Lehman drafted the complaint to contain claims for turnover and violation of the automatic stay because those allegations would give the bankruptcy court power to render a final ruling. He dismissed those claims, leaving the breach-of-contract allegation intact for the full amount sought. Intel's next move would be to seek to get the breach-of-contract claim taken out of bankruptcy court and decided in federal district court, Judge Peck said. Intel can argue that the U.S. Supreme Court's decision in Stern v. Marshall precludes a bankruptcy court from issuing a final ruling on a pre-bankruptcy breach claim. Still, Judge Peck said, "it is most efficient and eminently sensible for all disputes involving swap agreements" to be handled in bankruptcy court. He cited an opinion involving the Federal Housing Finance Agency in which U.S. District Judge Lorna G. Schofield asked Judge Peck to issue a report and recommendation even if his court can't enter a final ruling. Judge Peck proposed that Intel "agree to an adjudication of this adversary proceeding in the Lehman bankruptcy court." About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case No. 08-13555) on Sept. 15, 2008. Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC sought for bankruptcy protection in December 2009. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. Lehman emerged from bankruptcy protection on March 6, 2012, more than three years after it filed the largest bankruptcy in U.S. history. The Chapter 11 plan for the Lehman companies other than the broker was confirmed in December 2011. Lehman made its first payment of $22.5 billion to creditors in April 2012, a second payment of $10.2 billion on Oct. 1, 2012, and a third distribution of $14.2 billion on April 4, 2013. The brokerage is yet to make a first distribution to non-customers, although customers are being paid in full. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). LIFECARE HOLDINGS: Dismissal of Chapter 11 Sought ------------------------------------------------- BankruptcyData reported that LifeCare Holdings filed with the Court a motion seeking dismissal of its Chapter 11 proceedings. The motion explains, "At the conclusion of the sale process, the highest bid was a credit bid from the Prepetition Secured Lenders for less than all of the outstanding debt owed to them. As a result of successfully closing this transaction, the Purchaser continues to operate the business as a going concern, patients continue to be cared for and employees continue to have jobs. However, as no cash bid sufficient to pay the Prepetition Secured Lenders in full was received, the Debtors are unable to confirm a chapter 11 plan. Although the Purchaser provided limited funds to be placed in escrows to satisfy certain specified wind down costs, the Debtors' estates have no remaining assets with which to satisfy the Prepetition Secured Lenders' remaining claims or any other secured, administrative or priority claims against the Debtors' estates. However, because certain processes related to the Chapter 11 Cases remain unresolved -- including the Committee's claims resolution process and the United States' Appeals -- the Debtors believe it would be inappropriate to seek to convert these Chapter 11 Cases to chapter 7. Accordingly, the Debtors seek entry of an order dismissing the Chapter 11 Cases as the most efficient way to keep fees and expenses to a minimum without impairing the rights of third parties." The Court scheduled a Jan. 28, 2014 hearing to consider the motion. Judge Gross in September granted the request of LCI Holding and its debtor affiliates for an extension of their exclusive plan filing period through Feb. 28, 2014, and a corresponding extension of their exclusive right to solicit acceptance of that plan through April 29, 2014. About LifeCare LCI Holding Company, Inc., and its affiliates, doing business as LifeCare Hospitals, operate eight "hospital within hospital" facilities and 19 freestanding facilities in 10 states. The hospitals have about 1,400 beds at facilities in Louisiana, Texas, Pennsylvania, Ohio and Nevada. LifeCare is controlled by Carlyle Group, which holds 93.4% of the stock following a $570 million acquisition in August 2005. LCI Holding Company, Inc., and its affiliates, including LifeCare Holdings Inc., sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-13319) on Dec. 11, 2012, with plans to sell assets to secured lenders. The Debtors are represented by Anthony W. Clark, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in Wilmington, Delaware; Kenneth S. Ziman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in New York; and Felicia Gerber Perlman, Esq., and Matthew N. Kriegel, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in Chicago, Illinois. Rothschild Inc. is the financial advisor. Huron Management Services LLC will provide the Debtors an interim chief financial officer and certain additional personnel; and (ii) designate Stuart Walker as interim chief financial officer. The steering committee of lenders is represented by attorneys at Akin Gump Strauss Hauer & Feld LLP and Blank Rome LLP. The agent under the prepetition and postpetition secured credit facility is represented by Simpson Thacher & Barlett LLP. The Debtors disclosed assets of $422 million and liabilities totaling $575.9 million as of Sept. 30, 2012. As of the bankruptcy filing, total long-term obligations were $482.2 million consisting of, among other things, institutional loans and unsecured subordinated loans. A total of $353.4 million is owing under the prepetition secured credit facility. A total of $128.4 million is owing on senior subordinated notes. LifeCare Hospitals of Pittsburgh, LLC, a debtor-affiliate disclosed $24,028,730 in assets and $484,372,539 in liabilities as of the Chapter 11 filing. The Official Committee of Unsecured Creditors is represented by Pachulski Stang Ziehl & Jones LLP. FTI Consulting, Inc., serves as its financial advisor. LOEHMANN'S HOLDINGS: Proposes Up to $650,000 Bonus to Top Execs --------------------------------------------------------------- Katy Stech, writing for Dow Jones Business News, reported that Loehmann's Holdings Inc. top executive is in line to collect a bonus from the discount retailer which filed for bankruptcy and plans to begin shutting down its 39 stores next month. According to the report, the Bronx-based company has proposed to pay Chief Operating Officer William Thayer and another employee up to $650,000 in bonuses, according to court papers filed on Dec. 23 in U.S. Bankruptcy Court in New York. Loehmann's bankruptcy lawyers said Mr. Thayer has been "working the equivalent of three jobs" as the company prepares to hold a Jan. 3 auction for the right to liquidate Loehmann's stores, which employ about 1,600 people, the report related. Already, the company got a $19 million bid from a team of three liquidators: SB Capital Group LLC, Tiger Capital Group LLC and A&G Realty Partners LLC. Under the proposed bonus pay-out plan, the amount that Mr. Thayer collects would grow with the amount of money that the liquidation sales bring in. In addition, he would be required to provide "transition services," according to court papers, the report said. The bonus plan also offers cash awards to the retailer's top lawyer, Mindy Novack, the report further related. About Loehmann's Discount retailer Loehmann's Holdings Inc., and two affiliates sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 13-14050) on Dec. 15, 2013. This is Loehmann's third bankruptcy filing, but this time it will be a liquidation with going-out-of-business sales. The first bankruptcy was a 14-month Chapter 11 reorganization completed in September 2000. At the time the chain had 44 stores in 17 states. The second bankruptcy culminated in a reorganization plan implemented in March 2011. It was acquired by Istithmar in July 2006 in a $300 million transaction. Loehmann's, based in the Bronx borough of New York City, operated 39 stores in 11 states as of the 2013 bankruptcy filing. In the new Chapter 11 case, Loehmann's disclosed assets and debt both totaling $96.7 million. The debt includes $4.3 million on a first-lien credit agreement with Wells Fargo Bank NA as agent, not including about $9 million in letters of credit. Kristopher M. Hansen, Esq., at Stroock & Stroock & Lavan LLP, serves as counsel to the Debtors; Canaccord Genuity Inc. is the investment banker; Clear Thinking Group LLC is the restructuring advisor; and Epiq Bankruptcy Solutions LLC is the claims and notice agent. LONE PINE: Requests Reorganization Plan Confirmation in U.S. ------------------------------------------------------------ Stephanie Gleason, writing for The Wall Street Journal, reported that Lone Pine Resources Inc. is requesting U.S. Bankruptcy Court approval of its reorganization plan, contingent with it also receiving the Canadian bankruptcy court's blessing early next year. According to the report, the company is scheduled to ask the Canadian court to approve its plan during a sanction hearing on Jan. 9. That approval will implement the plan in Canada, but it still would require U.S. court confirmation. Lone Pine is requesting that on Jan. 14, the U.S. Bankruptcy Court in Wilmington, Del., approve the sanction order from Canada, making the plan binding in the U.S., the report related. On Dec. 13, Lone Pine received a "meeting order" from the Canadian court, directing it to call meetings with creditors to vote on the plan, which it is doing now in anticipation of its sanction hearing next month, the report said. Lone Pine's plan of reorganization is a debt-for-equity swap that would allow it to shed $195 million in bond debt, the report further related. The plan would hand equity in the reorganized company to those bondholders and raise $100 million in new cash through a private rights offering. Current equity holders are being wiped out. About Lone Pine Resources Calgary, Canada-based Lone Pine Resources Inc. is an independent oil and gas exploration, development and production company with operations in Canada. The Company's reserves, producing properties and exploration prospects are located in the provinces of Alberta, British Columbia and Quebec, and in the Northwest Territories. The Company is incorporated under the laws of the State of Delaware. Lone Pine entered bankruptcy protection in Canada on Sept. 25, 2013, under the Companies' Creditors Arrangement Act and received an initial protection order from an Alberta court the same day. Lone Pine Resources simultaneously filed for Chapter 15 protection in Delaware in the United States (Bankr. D. Del. Case No. 13- 12487) to seek recognition of the CCAA proceedings. Lone Pine, LPR Canada and all other subsidiaries of the Company are parties to the CCAA and Chapter 15 proceedings. Lone Pine is being advised by RBC Capital Markets, Bennett Jones LLP, Vinson & Elkins LLP and Richards Layton & Finger P.A. in connection with the restructuring, with Wachtell, Lipton, Rosen & Katz LLP providing independent advice to the Company's board of directors. The Supporting Noteholders are being advised by Goodmans LLP and Stroock & Stroock & Lavan LLP. LONGVIEW POWER: Court Approves Plan Outline ------------------------------------------- Peg Brickley, writing for Daily Bankruptcy Review, reported that Longview Power LLC won court permission to start polling creditors on a Chapter 11 restructuring that swaps more than $1 billion in debt for equity and provides money to fix its troubled plant. According to the report, Judge Brendan Shannon signed off on voting materials describing the bankruptcy-exit plan at a hearing in the U.S. Bankruptcy Court in Wilmington, Del. Once creditors cast their ballots, Longview will return to court to seek confirmation of the Chapter 11 exit plan, the report related. Under the plan, existing lenders have agreed to provide $150 million to fund emergence and repair the plant, which is in West Virginia. Longview bowed to unsecured creditor demands for more information on its Chapter 11 plan in order to get permission to start the polling, the report said. General unsecured creditors owed an estimated $4.5 million will get a recovery of 5.5% to 22%, according to revised plan materials. The company also added information to fend off preliminary objections from contractors that are fighting with Longview over who's to blame for the operational troubles that have dogged the plant, the report added. About Longview Power LLC Longview Power LLC is a special purpose entity created to construct, own, and operate a 695 MW supercritical pulverized coal-fired power plant located in Maidsville, West Virginia, just south of the Pennsylvania border and approximately 70 miles south of Pittsburgh. The project is owned 92% by First Reserve Corporation (First Reserve or sponsor), a private equity firm specializing in energy industry investments, through its affiliate GenPower Holdings (Delaware), L.P., and 8% by minority interests. Longview Power, LLC, filed a Chapter 11 (Bank. D. Del. Lead Case. 13-12211) on Aug. 30, 2013. The petitions were signed by Jeffery L. Keffer, the Company's chief executive officer, president, treasurer and secretary. The Debtor estimated assets and debts of more than $1 billion. Judge Brendan Linehan Shannon presides over the case. Kirkland & Ellis LLP and Richards, Layton & Finger, P.A., serve as the Debtors' counsel. Lazard Freres & Company LLC acts as the Debtors' investment bankers. Alvarez & Marsal North America, LLC, is the Debtors' restructuring advisors. Ernst & Young serves as the Debtors' accountants. The Debtors' claims agent is Donlin, Recano & Co. Inc. The Debtor disclosed assets of $1,717,906,595 plus undisclosed amounts and liabilities of $1,075,748,155 plus undisclosed amounts. Roberta A. DeAngelis, U.S. Trustee for Region 3, disclosed that as of September 11, 2013, a committee of unsecured creditors has not been appointed in the case due to insufficient response to the U.S. Trustee's communication/contact for service on the committee. Longview in November 2013 filed a bankruptcy-exit plan that will drop $1 billion in debt from the Debtor's balance sheet and raise money to cover the cost of fixing the plant. Under the Plan, the lenders would share between 85 percent and 90 percent of the reorganized company's equity, court papers show. The lenders providing the bankruptcy loan would get the rest of the equity. LOS GATOS HOTEL: Jan. 16 Hearing on Creditor's Bid to Market Hotel ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Northern District of California will hold a hearing Jan. 16 to consider creditor Terrie Ogilvie Christiansen's motion to compel Los Gatos Hotel Corporation to market its hotel for sale. The Ogilvies asked the Court to require the Debtor to retain a broker and expose the hotel to the market before seeking approval of any sale. According to the Ogilvies, the decision to ignore market alternatives is unusual enough; choosing to do so in the face of dramatic recent increases in hospitality industry values in the Bay Area is inexplicable. The hotel is profitable and has substantial equity, so there is no need for an urgent sale. The Debtor must be required to retain a broker and to expose the hotel to the market before it asks the Court to approve a quick sale. About Los Gatos Hotel San Jose, California-based Los Gatos Hotel Corporation, dba Hotel Los Gatos, was formed in 2000 to build and operate Hotel Los Gatos, a full-service boutique hotel in downtown Los Gatos, California. Los Gatos Hotel filed for Chapter 11 bankruptcy protection on December 27, 2010 (Bankr. N.D. Cal. Case No. 10-63135). The Debtor disclosed $17,191,277 in assets and $12,896,468 in liabilities as of the Chapter 11 filing. Affiliate Blossom Valley Investors, Inc., filed a separate Chapter 11 petition on September 10, 2009 (Bankr. N.D. Cal. Case No. 09-57669). Jeffry A. Davis, Esq., at Mintz Levin Cohn Ferris Glovsky Popeo, serves as the Debtor's bankruptcy counsel. The Debtor has tapped OSAS Inc. as financial advisor and investment banker. MERCANTILE BANCORP: Seeks Exclusivity to Complete Bank Sale ----------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Mercantile Bancorp Inc. completed the sale of its non-bankrupt bank subsidiary on Dec. 13 and for a second time asked for an extension of its exclusive right to propose a liquidating Chapter 11 plan. According to the report, United Community Bancorp Inc. bought the subsidiary under a contract meant to generate $23 million. Quincy, Illinois-based Mercantile is seeking two more months to file a plan. If approved at a Dec. 29 hearing, the new deadline would be Feb. 24. Mercantile said it should be able to fund a "confirmable" Chapter 11 plan of liquidation. About Mercantile Bancorp Mercantile Bancorp -- http://www.mercbanx.com/-- is a Quincy, Illinois-based bank holding company with wholly owned subsidiaries consisting of one bank in Illinois and one each in Kansas and Florida, where the Company conducts full-service commercial and consumer banking business, engages in mortgage banking, trust services and asset management, and provides other financial services and products. The Company also operated Mercantile Bank branch offices in Missouri and Indiana. On Aug. 10, 2011, the Illinois Division of Banking released a Consent Order that Mercantile Bank, the Federal Deposit Insurance Corporation, and the Division entered into as of July 28, 2011. Under the Order, Mercantile Bank will cease operating with all money transmitters and currency businesses providing brokerage, sale or exchange of non-United States currency for deposit customers. Furthermore, Mercantile Bank may not enter into a new line of business without the prior written consent of the FDIC and the Division. Mercantile Bancorp filed a Chapter 11 petition (Bankr. D. Del. Case No. 13-11634) on June 27, 2013. The petition shows assets and debt both exceeding $50 million. Liabilities include $61.9 million owing on junior subordinated debentures. Mercantile stopped paying interest on the debentures in 2009, since then running up $14 million in unpaid interest. Stuart M. Brown, Esq. at DLA Piper LLP (US), in Wilmington, Delaware; and Richard A. Chesley, Esq., Kimberly D. Newmarch, Esq., and Aaron M. Paushter, Esq., at DLA Piper LLP (US), in Chicago, Illinois, are the attorneys for the Debtor. A three-member official committee of unsecured creditors was appointed by the U.S. Trustee. An official committee of trust preferred securities holders was also appointed by the U.S. Trustee. The TruPS Committee is represented by Domenic E. Pacitti, Esq., at Klehr Harrison Harvey Branzburg LLP, in Wilmington, Delaware; Morton R. Branzburg, Esq., at Klehr Harrison Harvey Branzburg LLP, in Philadelphia, Pennsylvania; David R. Seligman, P.C., Esq., and Jeffrey W. Gettleman, Esq., at Kirkland & Ellis LLP, in Chicago, Illinois; and Joseph Serino Jr., P.C., Esq., and John P. Del Monaco, Esq., at Kirkland & Ellis LLP, in New York. METEX MANUFACTURING: Files Plan With $190 Million Asbestos Trust ---------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Metex Manufacturing Corp., known as Kentile Floors Inc. during its first bankruptcy reorganization, filed another Chapter 11 plan this week to address asbestos claims arising after the first bankruptcy was completed. According to the report, into the 1980s, Kentile made tile using asbestos. From 1992 to 1998, Kentile's first bankruptcy dealt with claims filed up to that time. That bankruptcy proved insufficient for dealing with later-filed claims. Kentile said its insurance companies paid out $154 million after the first bankruptcy to settle 10,000 claims. Renamed Metex on filing for Chapter 11 protection again in November 2012, the company had 26,000 active or inactive personal injury or wrongful death claims. Before the new bankruptcy, Great Neck, New York-based Metex put together a prepackaged Chapter 11 plan supported by eight insurance companies and several law firms representing thousands of asbestos claimants. The plan didn't work as a prepack because only about 66 percent of asbestos claims, by amount, voted for it, shy of the 75 percent required. In the prepackaged plan that failed, insurance companies would have contributed $165 million to a trust. The company and representatives of current and future asbestos claimants cobbled together a new Chapter 11 plan substantially similar to the one that failed. The major difference is that the new plan is funded with $182.1 million to $189.75 million from nine insurance companies, and it's richer by $15 million to $20 million, according to a court filing. The plan takes advantage of a provision in bankruptcy law allowing the insurance companies to obtain immunity from further liability on their Kentile policies in return for the settlements, which are to be approved along with the plan. There will be a hearing on Feb. 20 in U.S. Bankruptcy Court in Manhattan for approval of the disclosure statement explaining the plan. Voting on the plan is to end May 2, followed by a confirmation hearing on May 22. Liberty Mutual Insurance Co. has been paying most of the claims in recent years, Metex said in a court filing. About Metex Great Neck, New York-based Metex Mfg. Corporation, formerly known as Kentile Floors, Inc., started business in the late 1800's as a manufacturer of cork tile, and thereafter progressed to making composite tile for commercial and residential use. Metex filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 12-14554) on Nov. 9, 2012. The petition was signed by Anthony J. Miceli, president. The Debtor estimated its assets and debts at $100 million to $500 million. Judge Burton R. Lifland presides over the case. Paul M. Singer, Esq., and Gregory L. Taddonio, Esq., at Reed Smith LLP, in Pittsburgh, Pa.; and Paul E. Breene, Esq., and Michael J. Venditto, Esq., at Reed Smith LLP, in New York, N.Y., represent the Debtor as counsel. MI PUEBLO: Court Okays Cash Collateral Use Until Jan. 12 -------------------------------------------------------- The Hon. Arthur S. Weissbrodt issued a ninth interim order, granting Mi Pueblo San Jose, Inc., permission to use Wells Fargo Bank, N.A.'s cash collateral until Jan. 12, 2014. As adequate protection, the Debtor will make these adequate protection payments to the Bank: (1) on Dec. 30, 2013, the amount equal to the sum of (i) the monthly payment of principal and interest at the non- default rate that will be due and owing by the Debtor to the Bank pursuant to the Term Note dated May 15, 2012, in the original principal amount of $12.50 million, made by the Debtor to the order of the Bank, on that payment date; (ii) the monthly payment of interest at the non- default rate that will be due and owing by the Debtor to the Bank pursuant the revolving reducing note dated May 15, 2012, in the original principal amount of $12.50 million, made by the Debtor to the order of the Bank, on that payment date; and (iii) the monthly payment required to be paid by the Debtor to the Bank pursuant to the swap documents executed by the Debtor in favor of the Bank for Trade No. 9285392, on that payment date; and (2) on certain dates and in amounts to be specified, any further adequate protection payments required to be made pursuant to any further interim cash collateral order. As further adequate protection for the Debtor's use of cash collateral, the Bank has been granted a valid, nonavoidable, and fully perfected replacement lien in the replacement collateral, or all property of the same type as the pre-petition collateral acquired by the Debtor on or after the Petition Date, to secure any diminution in value of any of the pre-petition collateral. In addition to the continuation of the replacement lien, the Bank will continue to be entitled to an administrative expense claim with a superpriority status. A copy of the budget is available for free at: http://bankrupt.com/misc/MIPUEBLOcashcoll9budget.pdf About Mi Pueblo San Jose Mi Pueblo San Jose, Inc., filed a Chapter 11 petition (Bankr. N.D. Calif. Case No. 13-53893) in San Jose, California, on July 22, 2013. An affiliate, Cha Cha Enterprises, LLC, sought Chapter 11 protection (Case No. 13-53894) on the same day. The cases are not jointly administered. In its amended schedules, Mi Pueblo disclosed $61,577,296 in assets and $68,735,285 in liabilities as of the Petition Date. Heinz Binder, Esq., at Binder & Malter, LLP, is the Debtor's general reorganization counsel. The Law Offices of Wm. Thomas Lewis, sometimes doing business as Robertson & Lewis, is the Debtor's special counsel. Avant Advisory Partners, LLC serves as its financial advisors. Bustamante & Gagliasso, P.C. serves as its special counsel. The U.S. Trustee appointed seven members to the Official Committee of Unsecured Creditors. Protiviti Inc. serves as financial advisor. Stutman, Treister & Glatt P.C. serves as counsel to the Committee. MICROVISION INC: Receives Nasdaq Listing Deficiency Notice ---------------------------------------------------------- MicroVision, Inc., received a notice on Dec. 17, 2013, from The Nasdaq Stock Market advising the company that for 30 consecutive business days preceding the date of the notice the company was not in compliance with the $50,000,000 minimum market value of listed securities required for continued listing on The Nasdaq Global Market pursuant to Nasdaq's listing requirements. In accordance with Nasdaq's listing rules, the company has 180 calendar days, or until June 16, 2014, to regain compliance with this requirement. This notification is simply a notice of deficiency, not of imminent delisting, and has no current effect on the listing or trading of MicroVision's common stock on The Nasdaq Global Market. During the 180-day compliance period, MicroVision can regain compliance if the market value of its listed securities closes at $50,000,000 or more for a minimum of 10 consecutive business days. The Company could also regain compliance with Nasdaq's continued listing requirements by reporting stockholders' equity of $10 million or more. If the company does not regain compliance by June 16, 2014, Nasdaq will notify the company that its securities are subject to delisting. The company said its key objectives are to secure customer commitments under the company's Image by PicoP(R) licensing business model, to strengthen its supply chain to enable customers to bring products to market and to aggressively manage cash used in operations. The company believes the best way to regain compliance is to successfully execute on its strategy. About Microvision Inc. Headquartered in Redmond, Washington, MicroVision, Inc. (NASDAQ: MVIS) is the creator of PicoP(R) display technology, an ultra- miniature laser projection solution for mobile consumer electronics, automotive head-up displays and other applications. The Company reported a net loss of $7.09 million on $3.67 million of total revenue for the six months ended June 30, 2013, compared with a net loss of $14.77 million on $3.03 million of total revenue for the corresponding period of 2012. The Company's balance sheet at Sept. 30, 2013, showed $12.01 million in total assets, $12.20 million in total liabilities and a $190,000 total shareholders' deficit. MONTREAL MAINE: Victims Seek to Disband Committee ------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that victims of the Montreal Maine & Atlantic Railway Ltd. train disaster urged a bankruptcy judge to disband the newly formed official committee representing those injured or killed. According to the report, in a railroad reorganization like MM&A's, creditors' committees aren't automatically appointed as they are for ordinary companies in Chapter 11, in part because railroads must have trustees appointed. Initially, MM&A's trustee and the U.S. Trustee both objected to having a victims' committee. U.S. Bankruptcy Judge Louis H. Kornreich in Bangor, Maine, decided on a committee limited to conferring with the trustee and participating in formulation of a Chapter 11 plan. The committee was to represent those who sustained damages when a runaway MM&A train killed 47 people after derailing and burning in Lac-Megantic, Quebec. In October, Judge Kornreich formally called for an official committee "of sufficient size and diversity" to assist in "formulation of a plan which will determine the extent to which victims may share in any distribution." After the U.S. Trustee formed a four-member panel, an ad hoc committee asked to have the official committee disbanded. The ad hoc group said it represents 46 victims of the disaster. The U.S. Trustee filed papers in opposition on Dec. 24. He said the inability to form a larger, more representative committee was the work of the ad hoc group, which refused to serve. The ad hoc group said in their filing that they won't serve on the committee because recoveries won't come from the Chapter 11 case. They said recompense for their damages will come through the parallel Canadian bankruptcy or through government largesse. There will be an auction on Jan. 21 to determine whether a $14.3 million bid from Fortress Investment Group LLC for the railroad is the best offer. About Montreal Maine Montreal, Maine & Atlantic Railway Ltd., the railway company that operated the train that derailed and exploded in July 2013, killing 47 people and destroying part of Lac-Megantic, Quebec, sought bankruptcy protection in U.S. Bankruptcy Court in Bangor, Maine (Case No. 13-10670) on Aug. 7, 2013, with the aim of selling its business. Its Canadian counterpart, Montreal, Maine & Atlantic Canada Co., meanwhile, filed for protection from creditors in Superior Court of Quebec in Montreal. Robert J. Keach, Esq., at Bernstein, Shur, Sawyer, and Nelson, P.A., has been named as chapter 11 trustee. His firm serves as his chapter 11 bankruptcy counsel. Development Specialists, Inc., serves as his financial advisor. Gordian Group, LLC, serves as the Chapter 11 Trustee's investment banker. U.S. Bankruptcy Judge Louis H. Kornreich has been assigned to the U.S. case. The Maine law firm of Verrill Dana served as counsel to MM&A. It now serves as counsel to the Chapter 11 Trustee. Justice Martin Castonguay oversees the case in Canada. The Canadian Transportation Agency suspended the carrier's operating certificate after the accident, due to insufficient liability coverage. The town of Lac-Megantic, Quebec, is seeking financial aid to restore the gutted community and a civil complaint alleges a failure to take steps to prevent a derailment. An unofficial committee of wrongful death claimants consisting of representatives of the estates of the 46 victims, is represented by George W. Kurr, Jr., Esq., at GROSS, MINSKY & MOGUL, P.A.; Daniel C. Cohn, Esq., at MURTHA CULLINA LLP; Peter J. Flowers, Esq., at MEYERS & FLOWERS, LLC; Jason C. Webster, Esq., at THE WEBSTER LAW FIRM; and Mitchell A. Toups, Esq., at Weller, Green, Toups & Terrell LLP. MOORE FREIGHT: Drew McElroy, et al. Okayed as Litigation Counsel ---------------------------------------------------------------- The Bankruptcy Court authorized Moore Freight Services, Inc. and G.R.E.A.T. Logistics, Inc., to employ the Law Office of Drew McElroy, Tate Law Group, and Savage, Turner, Pinckney & Madison as special litigation counsel. As reported in the Troubled Company Reporter on Nov. 26, 2013, those firms are expected to represent the Debtors in connection with their claims against Pilot Flying J. The professional services that the special counsel will render to the Debtors include, but will not be limited to, the following: (a) assist and advise the Debtors with respect to claims against Pilot Flying J generally for withheld rebates; (b) prepare, file, and prosecute on the Debtors' behalf an action against Pilot Flying J; (c) appear, as appropriate, before the Court and other state or federal courts and tribunals on behalf of the Debtors with respect to the claims against PFJ; and (d) perform all other necessary legal services related to the Debtors' claims against PFJ for withheld rebates. The Debtors wish to retain special counsel on a contingency basis on the following terms: (a) 40% of any amount recovered in excess of the $240,713 already paid to Moore Freights, the 40% contingency fee is the total percentage payable jointly to the Special Counsel; (b) reasonable costs and expenses incurred solely and directly for the benefit of Moore Freight or as pro-rated among all plaintiffs if beneficial to the entire group; (c) in the event of termination of the representation by Special Counsel for lack of cooperation by Moore Freight, then the Debtors agree to pay, in addition to the reasonable costs and expenses incurred solely and directly on behalf of Moore Freight, the reasonable value of services performed by Special Counsel that would not otherwise have been performed for or provided on behalf of other plaintiffs represented by Special Counsel at a rate of $250 per hour; and (d) in the event of termination of the representation by Moore Freight, then the Debtors agree to pay, in addition to the reasonable costs and expenses incurred solely and directly on behalf of Moore Freight, the reasonable value of services performed by Special Counsel that would not otherwise have been performed for or provided on behalf of other plaintiffs represented by Special Counsel at the greater of an hourly rate of $250 or the applicable percentage of fee due under any offers for settlement with Moore Freight made by Pilot Flying J. L. Andrew McElroy, II, principal of The Law Office of Drew McElroy, Mark A. Tate, principal of The Tate Law Group, LLC, and Robert Bartley Turner, principal of Savage, Turner, Pinckney & Madison, assured the Court that their respective firms are a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. About Moore Freight Service and G.R.E.A.T. Logistics Moore Freight Service, Inc. and G.R.E.A.T. Logistics Inc. sought Chapter 11 protection (Bankr. M.D. Tenn. Case Nos. 12-08921 and 12-08923) in Nashville on Sept. 28, 2012. Moore Freight is a freight service company specializing in flat gas transportation. Founded in 2001, Moore is the largest commercial flat glass logistics firm in the U.S. It operates in the U.S., Canada and Mexico. GLI does not have any operations other than the limited, occasional freight brokerage services currently provided to Moore Freight. Bankruptcy Judge Keith M. Lundin oversees the cases. Attorneys at Harwell Howard Hyne Gabbert & Manner, P.C., serve as counsel. LTC Advisory Services LLC serves as the Debtor's financial advisors. Moore Freight estimated assets and debts of $10 million to $50 million. CEO Dan R. Moore signed the petitions. Counsel for the Debtor's pre-bankruptcy and DIP lender, Marquette Transportation Finance, Inc., are Linda W. Knight, Esq., at Gullett, Sanford, Robinson & Martin, PLLC; and Thomas J. Lallier, Esq., at Foley & Mansfield PLLP. On Sept. 17, 2013, the Court approved Moore Freight Service, Inc., et al.'s Amended Disclosure Statement describing the Debtors' Amended Plan of Reorganization dated Sept. 16, 2013. The Amended Plan contemplates the continuation of the Debtors' business, payment in full of Allowed Secured Claims, and a fair distribution to unsecured creditors, which distribution Debtor believe far exceeds the amount unsecured creditors would receive in the event of a Chapter 7 liquidation. NAVISTAR INTERNATIONAL: Had $898 Million Net Loss in Fiscal 2013 ---------------------------------------------------------------- Navistar International Corporation filed with the U.S. Securities and Exchange Commission its annual report on Form 10-K disclosing a net loss attributable to the Company of $898 million on $10.77 billion of net sales and revenues for the year ended Oct. 31, 2013, as compared with a net loss attributable to the Company of $3.01 billion on $12.69 billion of net sales and revenues during the prior fiscal year. For the quarter ended Oct. 31, 2013, the Company reported a net loss attributable to the Company of $154 million on $2.75 billion of net sales and revenues as compared with a net loss attributable to the Company of $2.76 billion on $3.17 billion of net sales and revenues for the same quarter a year ago. The Company's balance sheet at Oct. 31, 2013, showed $8.31 billion in total assets, $11.91 billion in total liabilities and a $3.60 billion total stockholders' deficit. "Operationally, we hit our plan this quarter, and we ended the year with an order backlog that is up 26 percent compared to this time last year. Those are just two examples of the continued progress we are making on our Drive to Deliver turnaround plan," said Troy A. Clarke, Navistar's president and chief executive officer. "During the quarter, we strengthened our cash position, continued to reduce structural costs, completed our on-highway Class 8 transition to SCR emissions technology, and progressed with our medium-duty product transition launches, resulting in 500 medium duty SCR trucks and buses built this month, as planned. "Clearly, we are disappointed that our previous engine strategy continues to negatively impact us in the form of additional warranty expense, but we will continue to stand behind our products and manage this issue as these engines work their way through the standard and extended warranty cycles," Clarke said. "We're not letting it overshadow the strong progress we've made to fundamentally change Navistar's operations and culture in 2013. We still have a lot of hard work ahead of us, but we are pleased to be entering 2014 in a much stronger position than we were one year ago." A copy of the Form 10-K is available for free at: http://is.gd/Vjfl81 About Navistar International Navistar International Corporation (NYSE: NAV) -- http://www.Navistar.com/-- is a holding company whose subsidiaries and affiliates subsidiaries produce International(R) brand commercial and military trucks, MaxxForce(R) brand diesel engines, IC Bus(TM) brand school and commercial buses, Monaco RV brands of recreational vehicles, and Workhorse(R) brand chassis for motor homes and step vans. It also is a private-label designer and manufacturer of diesel engines for the pickup truck, van and SUV markets. The Company also provides truck and diesel engine parts and service. Another affiliate offers financing services. * * * As reported by the TCR on Oct. 9, 2013, Standard & Poor's Ratings Services lowered its long-term corporate credit rating on Navistar International Corp. to 'CCC+' from 'B-'. "The rating downgrades reflect our increased skepticism regarding NAV's prospects for achieving the market shares it needs for a successful business turnaround," said credit analyst Sol Samson. As reported by the TCR on Jan. 24, 2013, Fitch Ratings affirmed the Issuer Default Ratings (IDR) for Navistar International Corporation and Navistar Financial Corporation at 'CCC' and removed the Negative Outlook on the ratings. The removal reflects Fitch's view that immediate concerns about liquidity have lessened, although liquidity remains an important rating consideration as NAV implements its selective catalytic reduction (SCR) engine strategy. Other rating concerns are already incorporated in the 'CCC' rating. In the Aug. 3, 2012, edition of the TCR, Moody's Investors Service lowered Navistar International Corporation's Corporate Family Rating (CFR), Probability of Default Rating (PDR), and senior note rating to B2 from B1. The downgrade of Navistar's ratings reflects the significant challenges the company will face during the next eighteen months in re-establishing the profitability and competitiveness of its US and Canadian truck operations in light of the failure to achieve EPA certification of its EGR emissions technology, the significant reductions in military revenues and substantially higher engine warranty reserves. NEW ENGLAND COMPOUNDING: $100+ Mil. Creditors Fund to Be Set Up --------------------------------------------------------------- Brown Rudnick LLP on Dec. 23 disclosed that owners of the bankrupt New England Compounding Pharmacy ("NECC") and NECC's insurers have reached agreements in principle concerning settlements with Bankruptcy Trustee Paul D. Moore, the Official Unsecured Creditor's Committee (the "Committee") and the Plaintiffs Steering Committee (the "PSC") in multidistrict litigation involving NECC pending in Federal Court in Boston (the "MDL") to contribute an amount estimated to exceed $100 million to a compensation fund to be distributed to NECC creditors, including victims who received injections of tainted steroids traced to NECC. The settlement agreements are subject to final documentation and Bankruptcy Court approval. The fund will be implemented as part of a Chapter 11 plan. The Center for Disease Control estimates that well over 700 people nation-wide have been diagnosed with fungal meningitis or other serious fungal infections. At least 64 deaths have been confirmed. Paul Moore, the Trustee of bankrupt NECC, commented, "We are pleased that a significant amount of funds will become available for distribution to victims and their families as compensation for the deaths, injuries and suffering they endured as a result of this tragic meningitis outbreak." David Molton and William Baldiga, partners at Brown Rudnick and counsel to the Committee, added that these settlements "are a material step in expediting compensation to victims and should bring momentum to the Trustee's and Committee's ongoing and vigorous efforts to add to this victims' fund with settlements from others, including medical care providers and pain clinics that administered the tainted steroids to their patients." "This preliminary settlement marks a critical milestone in our efforts to maximize recovery for the victims and their families," added Anne Andrews and Harry Roth, co-chairs of the Committee. "We are enormously pleased with what the Trustee and our Committee have accomplished after prolonged negotiations." Thomas Sobol, lead counsel for the PSC and the PSC's representative with respect to the negotiations, stated that the PSC is also supportive of the preliminary settlements. NECC's owners commented that "while they deny any liability or wrongdoing, nonetheless they strongly desire to play a major role in establishing a fund for people who died or suffered as a result of this tragic outbreak." The victim compensation fund will be funded by cash contributions by the owners of NECC as well as from proceeds from, among other things, insurance, tax refunds and the sale of a related business. Pursuant to the bankruptcy process, Judge Henry J. Boroff of the U.S. Bankruptcy Court of the Eastern District of Massachusetts will be asked to confirm a plan containing the terms of the settlement agreements creating and funding the victim's compensation fund. Jan. 15 Claims Bar Date Set As a reminder to all victims and creditors, the Bankruptcy Court established January 15, 2014, at 4:00 p.m. EST as the deadline for submitting their proofs of claim in the NECC bankruptcy proceeding. This Bar Date Order establishes procedures for filing and submitting claims for injuries suffered due to NECC's contaminated steroid injections. The Trustee and the Committee stress that it is extremely important that anyone who believes he or she has a claim against NECC or involving an NECC product timely file a proof of claim. Failing to do so may have an impact on a person's ability to obtain a distribution from the compensation fund established to compensate NECC victims or creditors. Information regarding the filing date deadline and the proof of claim process can be found at: http://www.donlinrecano.com/cases/proofofclaim/necp Hagens Berman's Statement on Accord Hagens Berman Sobol Shapiro, LLP disclosed that the Court- appointed Plaintiffs' Steering Committee (PSC), charged with speaking for hundreds of victims of tainted steroids produced by the New England Compounding Pharmacy, Inc. (NECC), on Dec. 23 announced a preliminary settlement with the owners, operators and insurers of the bankrupt NECC. A conditional agreement has been reached between bankruptcy trustee Paul D. Moore, the PSC and the Unsecured Creditors Committee under which the Cadden and Conigliaro families, the insurers of NECC and related company Ameridose, have promised to pay to a compensation fund an amount that may exceed $100 million. This fund will allow victims who received injections of tainted steroids made by NECC to seek a measure of justice against those wrongdoers. The agreements are not final, require due diligence on the part of the PSC to ensure the rights to victims are protected under these agreements, and will be conditional upon approval by creditors and a federal court for fairness and adequacy. Thomas M. Sobol, lead counsel for the PSC in the national litigation pending before a federal court in Boston, said, "The PSC has worked hard over the last several months to evaluate the liability of everyone involved in this tragedy and the tentative agreements are a big step forward in getting justice for victims. However, we must all be mindful that the agreements still require much work in order to protect the rights of victims. We also recognize that any amount of money would be grossly inadequate to compensate the families of those persons killed and others grievously injured by the callous conduct of those in charge of NECC." Mr. Sobol said, "This is but one chapter in this saga; litigation will continue against medical clinics, doctors, hospitals and other companies who were hired by NECC that bear responsibility to those who were badly injured or who died horrible and painful deaths as a result of having the injection of the tainted product into their bodies. This case is not over until all the wrongdoers have been brought to justice." "The proposed settlement does not resolve families' claims against the corporate-owned clinics that sold and injected these contaminated medications, such as St. Thomas Outpatient Neurosurgery Clinic in Nashville, Tenn., and other related St. Thomas companies. Numerous St. Thomas patients died or suffered serious illnesses as a result of receiving contaminated medications sold and administered at St. Thomas' Nashville facility," said PSC Member Gerard Stranch. "These corporate-owned companies chose to put profits over patient safety, as detailed in the hundreds of lawsuits filed against these companies, including St. Thomas, by families whose loved ones died or suffered serious injuries," said PSC Member Mark Chalos, who also represents a number of affected families. "Any corporation that endangers our families by breaking patient safety rules should be held accountable for their conduct -- no matter how rich or powerful those corporations are," said Mr. Chalos. There is no deadline set for when details of the proposal will be made public. The next court hearing in connection with this case is scheduled for January 10, 2014, at which point further due diligence will have been undertaken and additional details can likely be released. Full and complete information will be released to the public in due course and all victims who file a proof of claim in the Bankruptcy Court will have the opportunity to support or oppose the settlement. All victims and their counsel are reminded that the Bankruptcy Court has established a deadline of January 15th, 2014 at 4:00 p.m. EST to submit a claim in the NECC bankruptcy proceeding. Further information regarding that can be found at http://www.donlinrecano.com/cases/proofofclaim/necp For further information, please contact the Plaintiffs' Steering Committee: Thomas M. Sobol Kristen Johnson Parker HAGENS BERMAN SOBOL SHAPIRO, LLP 55 Cambridge Parkway, Suite 301 Cambridge, MA 02142 Telephone: 617/482-3700 Facsimile: 617/482-3003 E-mail: tom@hbsslaw.com kristenjp@hbsslaw.com Plaintiffs' Lead Counsel Elizabeth J. Cabraser Mark P. Chalos LIEFF CABRASER, HEIMANN & BERNSTEIN, LLP 150 Fourth Avenue North, Suite 1650 Nashville, TN 37219-2417 Telephone: 615/313-9000 Facsimile: 615/313-9965 E-mail: ecabraser@lchb.com mchalos@lchb.com Marc E. Lipton LIPTON LAW 18930 W. 10 Mile Road Southfield, MI 48075 Telephone: 248/557-1688 Facsimile: 248/557-6344 E-mail: marc@liptonlaw.com Kimberly A. Dougherty JANET, JENNER & SUGGS, LLC 31 St. James Avenue, Suite 365 Boston, MA 02116 Telephone: 617/933-1265 E-mail: kdougherty@myadvocates.com Patrick T. Fennell CRANDALL & KATT 366 Elm Avenue SW Roanoke, VA 24016 Telephone: 540/342-2000 Facsimile: 540/400-0616 E-mail: pfennell@crandalllaw.com Mark Zamora ZAMORA FIRM 5 Concourse Parkway, Suite 2350 Atlanta, GA 30328 Telephone: 404/451-7781 Facsimile: 404/506-9223 E-mail: mark@markzamora.com J. Gerard Stranch, IV Benjamin A. Gastel BRANSTETTER, STRANCH & JENNINGS, PLLC 227 Second Avenue North Nashville, TN 37201 Telephone: 615/254-8801 Facsimile: 615/255-5419 E-mail: gerards@branstetterlaw.com About Hagens Berman Hagens Berman Sobol Shapiro, LLP -- http://www.hbsslaw.com-- is a consumer-rights class-action law firm with offices nine cities. About New England Compounding Pharmacy New England Compounding Pharmacy Inc., filed a Chapter 11 petition (Bankr. D. Mass. Case No. 12-19882) in Boston on Dec. 21, 2012, after a meningitis outbreak linked to an injectable steroid, methylprednisolone acetate ("MPA"), manufactured by NECC, killed 39 people and sickened 656 in 19 states, though no illnesses have been reported in Massachusetts. The Debtor owns and operates the New England Compounding Center is located in Framingham, Mass. In October 2012, the company recalled all its products, not just those associated with the outbreak. NEWLEAD HOLDINGS: Gets NASDAQ Non-Compliance Notice --------------------------------------------------- NewLead Holdings Ltd. disclosed that on December 23, 2013, the Company received notice from the Listing Qualifications Staff of The NASDAQ Stock Market LLC indicating that the Company did not satisfy the $50 million in market value of listed securities requirement for continued listing on The NASDAQ Global Select Market, as set forth in Listing Rule 5450(b)(2)(A), for the prior 30 consecutive business days. In accordance with the NASDAQ Listing Rules, the Company has been granted a 180-day grace period, through June 23, 2014, to evidence compliance with the Market Cap Requirement. Compliance with the Market Cap Requirement can be achieved if the Company evidences a market value of listed securities of at least $50 million for a minimum of 10 consecutive business days, but generally for no more than 20 consecutive business days, during the grace period. The Company believes it can achieve compliance with the Market Cap Requirement during the grace period as it executes on its business plan, which contemplates the completion of additional acquisitions; however, there can be no assurance that the Company will be able to do so. Currently, the Company has approximately 29.7 million shares outstanding, which based on the Dec. 24 closing price reflects a market capitalization of approximately $43.0 million The Company previously attended a hearing before the NASDAQ Listing Qualifications Panel to address the Company's non- compliance with the $1.00 bid price requirement. Compliance with the bid price requirement can be achieved if the Company's common stock closes at or above $1.00 per share for a minimum of 10 consecutive business days, but generally for no more than 20 consecutive business days. To address the bid price deficiency, on December 6, 2013, the Company implemented a 1-for-3 reverse stock split, which has resulted in the Company evidencing a closing bid price of at least $1.00 per share for 13 consecutive business days as of December 24, 2013. The Company is awaiting the Panel's decision with respect to its compliance with the $1.00 bid price requirement. 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: Providence Equity's Firm at Caa2 on Lower Revenue ------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that NexTag Inc., a comparison-shopping website, has an "elevated" risk of default in view of "rapid erosion in its core product," Moody's Investors Service said on Dec. 23 in a report. According to the report, Moody's downgraded the corporate rating one notch to Caa2, matching action taken on Dec. 6 by Standard & Poor's. The company's "cash burn" is increasing, Moody's said, thus degrading creditors' recoveries absent an infusion of new capital. S&P said revenue in the third quarter was "significantly" lower and that the company "doesn't have adequate liquidity to fund the cost associated with developing new sites." The competition is Google Shopping, Shopzilla.com, and Pricegrabber.com, S&P said. Based in San Mateo, California, NexTag generated $184 million in revenue for a year ended in September 2012, Moody's said. For a year ended in September, annual revenue was down to $154 million, Moody's said. NexTag is controlled by private-equity investor Providence Equity Partners Inc. OCZ TECHNOLOGY: To Auction Assets in Jan.; Toshiba Leads Bidding ---------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that OCZ Technology Group Inc., a maker of solid-state computer drives, will hold an auction Jan. 15 to determine whether a $35 million offer from Toshiba Corp. is the best bid to purchase the business. According to the report, under procedures approved Dec. 23 by the U.S. Bankruptcy Court in Delaware, competing bids are due Jan. 13. A hearing to approve a sale to the high bidder will take place Jan. 16. OCZ filed a petition for Chapter 11 protection on Dec. 2, having already negotiated the contract with Toshiba. The purchase price will be paid in part with $23.5 million in financing it's supplying for the reorganization. The U.S. Trustee objected to granting Minato-Ku, Japan-based Toshiba a breakup fee if outbid. The court approved a $700,000 termination fee and another $500,000 in expense reimbursement if someone else wins the auction. OCZ listed $29.3 million in secured debt and $31.4 million in unsecured claims held by trade creditors. In addition to $9.7 million owing to secured lender Hercules Technology Growth Capital Inc., secured obligations include a $6.5 million second lien and $13.1 million owing on 9 percent convertible senior secured notes. For the fiscal year ended in February, OCZ reported a $133.8 million loss from operations and a $125.8 million net loss on revenue of $334 million. The balance sheet as of Feb. 28 showed assets of $78.8 million and total liabilities of $52.5 million. The Chapter 11 petition listed assets of $34.1 million against debt of $65.5 million. 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. ORCHARD SUPPLY: Sold as Chapter 11 Plan Confirmed ------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that creditors of Orchard Supply Hardware Stores Corp. will soon get a recovery of 2.1 percent to 3 percent on $25 million to $35 million in claims now that a bankruptcy judge in Delaware has signed a confirmation order approving its Chapter 11 plan. According to the report, the plan confirmed Dec. 20 resulted from a settlement between the creditors' committee and secured term- loan lenders. It assured payment of costs of the Chapter 11 case, with excess remaining for unsecured creditors. After the business was sold, the company changed its name to OSH 1 Liquidating Corp. Holders of senior notes whose claims totaled $130.7 million were predicted to recover 74 percent to 86 percent. Objections to the plan lodged by the Internal Revenue Service were resolved by including provisions in the confirmation order saying the plan won't preclude the IRS from pursuing non-bankrupt individuals for their personal liability on tax debt. The plan also preserves the tax agency's rights of setoff and recoupment. By settling, the committee gave up the right to sue lenders over the validity of a $127 million term loan. Lowe's Companies Inc. bought 72 of San Jose, California-based Orchard Supply's 91 stores for $205 million. There was $118 million owing on an asset-backed loan with a lien ahead of the term-loan lenders. The settlement called for paying off bankruptcy financing from sale proceeds, with term lenders receiving the remainder after Orchard Supply retained $25 million. The settlement also created a trust for unsecured creditors funded with $500,000 from the company. After term lenders recover 90 percent of their claims, the next $1.5 million is for the creditors' trust. From proceeds of lease sales at the 19 stores Lowe's didn't buy, the creditors' trust receives the first $250,000, with the remainder for term lenders. At the outset of bankruptcy, Orchard had 89 stores in California and two in Oregon. Orchard Supply was 80.1 percent owned by Sears Holdings Corp. until spun off in December 2011. 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. PALM BEACH COMMUNITY: May Hire Furr and Cohen as Attorneys ---------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Florida has granted Palm Beach Community Church, Inc., permission to employ Robert C. Furr and the law firm of Furr and Cohen, P.A., as attorney, nunc pro tunc to Oct. 20, 2013. As reported by the Troubled Company Reporter on Nov. 29, 2013, the Debtor requires Furr and Cohen to, among other things, advise the Debtor with respect to its responsibilities in complying with the U.S. Trustee's operating guidelines and reporting requirements and with the rules of the court. Palm Beach Community Church, Inc., filed a Chapter 11 petition (Bankr. S.D. Fla. Case No. 13-35141) on Oct. 20, 2013. The petition was signed by Raymond Underwood as president. The Debtor disclosed total assets of $15.55 million and total liabilities of $11.43 million. PALM BEACH COMMUNITY: SmartPlan Financial Okayed as Accountant -------------------------------------------------------------- Palm Beach Community Church, Inc., has obtained authorization from the U.S. Bankruptcy Court for the Southern District of Florida to employ Roy Wiley and Covenant Financial, Inc. dba SmartPlan Financial Services as accountants, nunc pro tunc to the Petition Date. As reported by the Troubled Company Reporter on Nov. 29, 2013, SmartPlan Financial will, among other things, prepare required Federal, State and local tax returns with supporting schedules for the tax year ended, Dec. 31, 2013 and subsequent years. Palm Beach Community Church, Inc., filed a Chapter 11 petition (Bankr. S.D. Fla. Case No. 13-35141) on Oct. 20, 2013. The petition was signed by Raymond Underwood as president. The Debtor disclosed total assets of $15.55 million and total liabilities of $11.43 million. PALM BEACH COMMUNITY: Won't Have Creditors' Committee ----------------------------------------------------- The U.S. Trustee has informed the U.S. Bankruptcy Court for the Southern District of Florida that it will not appoint a committee of creditors in the Palm Beach Community Church, Inc. Chapter 11 case, until further notice. Palm Beach Community Church, Inc., filed a Chapter 11 petition (Bankr. S.D. Fla. Case No. 13-35141) on Oct. 20, 2013. The petition was signed by Raymond Underwood as president. The Debtor disclosed total assets of $15.55 million and total liabilities of $11.43 million. PAPA ADVERTISING: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Papa Advertising, Inc. 1673 West Eighth Street Erie, PA 16505 Case No.: 13-11525 Chapter 11 Petition Date: December 23, 2013 Court: United States Bankruptcy Court Western District of Pennsylvania (Erie) Judge: Hon. Thomas P. Agresti Debtor's Counsel: Guy C. Fustine, Esq. KNOX MCLAUGHLIN GORNALL & SENNETT, P.C. 120 West Tenth Street Erie, PA 16501 Tel: 814-459-2800 Email: mwernick@kmgslaw.com Estimated Assets: $100,000 to $500,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Victor J. Papa, Jr., president. A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/pawb13-11525.pdf PHYSIOTHERAPY HOLDINGS: Has Access to Cash Collateral Until Jan. 3 ------------------------------------------------------------------ The U.S, Bankruptcy Court for the District of Delaware authorized, on a final basis, Physiotherapy Holdings, Inc., to use cash collateral securing their prepetition indebtedness from U.S. Bank National Association, as administrative and collateral agent for a consortium of lenders. U.S. Bank consented to the use of cash collateral until Jan. 3, 2014. As reported in the Troubled Company Reporter on Nov. 20, 2013, the Cash Collateral would be used to fund and support, among other obligations, (i) working capital requirements; (ii) general corporate purposes; and (iii) the costs and expenses of administering the Chapter 11 cases. As adequate protection, U.S. Bank will be granted replacement liens upon and security interests in all of the Debtors' property. To the extent that the Replacement Liens are insufficient protection against the diminution in value of their interests in the Prepetition Collateral, the Agent will be granted an allowed superpriority administrative expense claim. The Replacement Liens will be senior to all other liens and will be junior and subordinate only to (i) the Carve-out and (ii) the Permitted Liens. The carve out means (i) all unpaid fees required to be paid to the Clerk of the Court and to the U.S. Trustee; (ii) fees and expenses of up to $25,000 incurred by a trustee under Section 726(b) of the Bankruptcy Code; (iii) all reasonable fees and expenses of professionals employed by the Debtors incurred at any time before the delivery of a carve-out trigger notice; (iv) all reasonable fees and expenses of professionals retained by any committee that are incurred prior to the delivery of a carve-out trigger notice; and (v) all fees incurred by professionals employed by the Debtors and any committee not exceeding $100,000 incurred on or after the delivery of the trigger date. About Physiotherapy Holdings Physiotherapy Holdings, Inc., and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case No. 13-12965) on Nov. 12, 2013. The Debtors are the largest pure-play provider of outpatient physical therapy services in the United States with a national footprint of 581 outpatient rehabilitation and orthotics & prosthetics clinics located in 29 states plus the District of Columbia. The Debtor is represented by Domenic E. Pacitti, Esq., and Michael W. Yurkewicz, Esq., at Klehr Harrison Harvey Branzburg, LLP, in Wilmington, Delaware; Morton Branzburg, Esq., at Klehr Harrison Harvey Branzburg LLP, in Philadelphia, Pennsylvania; and Jonathan S. Henes, P.C., Esq., Nicole L. Greenblatt, Esq., and David S. Meyer, Esq., at Kirkland & Ellis LLP, in New York. The Ad Hoc Committee of Senior Noteholders is represented by Michael L. Tuchin, Esq., and David A. Fidler, Esq., at Klee, Tuchin, Bogdanoff & Stern LLP, in Los Angeles, California. U.S. Bank, National Association, as Bridge Loan Agent, is represented by Stacey Rosenberg, Esq., at Latham & Watkins LLP, in Los Angeles, California. The Bank of New York Mellon Trust Company, N.A., as Senior Notes Indenture Trustee, is represented by Eric A. Schaffer, Esq., at Reed Smith, in Pittsburgh, Pennsylvania. The Consenting Shareholders are represented by Michael J. Sage, Esq., Matthew L. Larrabee, Esq., and Nicole B. Herther-Spiro, Esq., at Dechert LLP, in New York. PHI, in its prepackaged plan, stated that it is paying unsecured creditors because it intends to emerge from bankruptcy by the year's end under a prepackaged reorganization plan accepted by affected creditors before the Nov. 12 Chapter 11 filing. Roberta A. DeAngelis, the United States Trustee for Region 3 notified the U.S. Bankruptcy Court for the District of Delaware that a committee of unsecured creditors has not been appointed in the Chapter 11 cases of Physiotherapy Holdings, Inc. PHYSIOTHERAPY HOLDINGS: Prepackaged Chapter 11 Plan Is Confirmed ---------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Physiotherapy Holdings Inc., a provider of outpatient physiotherapy, can complete the prepackaged Chapter 11 reorganization begun Nov. 12 in Delaware. According to the report, the bankruptcy judge signed a confirmation order on Dec. 23 approving the plan that gives noteholders all the stock in exchange for debt and a predicted recovery of 40.3 percent. Noteholders voted for the plan before the Chapter 11 filing. The judge turned back objections to the plan lodged by the company's former owners, who are likely to be sued. About Physiotherapy Holdings Physiotherapy Holdings, Inc., and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case No. 13-12965) on Nov. 12, 2013. The Debtors are the largest pure-play provider of outpatient physical therapy services in the United States with a national footprint of 581 outpatient rehabilitation and orthotics & prosthetics clinics located in 29 states plus the District of Columbia. The Debtor is represented by Domenic E. Pacitti, Esq., and Michael W. Yurkewicz, Esq., at Klehr Harrison Harvey Branzburg, LLP, in Wilmington, Delaware; Morton Branzburg, Esq., at Klehr Harrison Harvey Branzburg LLP, in Philadelphia, Pennsylvania; and Jonathan S. Henes, P.C., Esq., Nicole L. Greenblatt, Esq., and David S. Meyer, Esq., at Kirkland & Ellis LLP, in New York. The Ad Hoc Committee of Senior Noteholders is represented by Michael L. Tuchin, Esq., and David A. Fidler, Esq., at Klee, Tuchin, Bogdanoff & Stern LLP, in Los Angeles, California. U.S. Bank, National Association, as Bridge Loan Agent, is represented by Stacey Rosenberg, Esq., at Latham & Watkins LLP, in Los Angeles, California. The Bank of New York Mellon Trust Company, N.A., as Senior Notes Indenture Trustee, is represented by Eric A. Schaffer, Esq., at Reed Smith, in Pittsburgh, Pennsylvania. The Consenting Shareholders are represented by Michael J. Sage, Esq., Matthew L. Larrabee, Esq., and Nicole B. Herther-Spiro, Esq., at Dechert LLP, in New York. Roberta A. DeAngelis, the United States Trustee for Region 3 notified the U.S. Bankruptcy Court for the District of Delaware that a committee of unsecured creditors has not been appointed in the Chapter 11 cases of Physiotherapy Holdings, Inc. RESIDENTIAL CAPITAL: Trust to Make Initial Cash Distribution ------------------------------------------------------------ The ResCap Liquidating Trust on Dec. 24 disclosed that it expects to make an initial distribution of Units of beneficial interest in the Trust and cash on or about Friday, December 27, 2013 to holders of allowed general unsecured claims in the ResCap bankruptcy case who have timely provided their brokerage information necessary to receive the Units and cash. The Second Amended Joint Chapter 11 Plan of Residential Capital, LLC et al. was declared effective by the Bankruptcy Court on December 17, 2013. A maximum of 100 million Units are issuable by the Trust. The CUSIP number assigned to the Units is 760841205. Distributions of Units will be made in the following ratios: -- For holders of claims against the ResCap Debtors: 0.014305344 Units per dollar of allowed claim. -- For holders of claims against the GMACM Debtors: 0.011848742 Units per dollar of allowed claim. -- For holders of claims against the RFC Debtors: 0.003528361 Units per dollar of allowed claim. Based on the reserve order issued by the Bankruptcy Court, the Trust will allocate 3,619,088 Units to the Disputed Claims Reserve, which is being established for holders of currently disputed claims that may be allowed in the future. The Trust will make an initial distribution of cash on or about December 27, 2013 of $17.65 per Unit. The cash actually received by claim holders may depend on expense deductions for their fiduciaries or professionals. For a claim holder to receive the Units to which it is entitled under the Plan, the broker, bank or other nominee of the claim holder must initiate a DWAC transfer in accordance with the procedures of the Depository Trust Company (DTC) for the number of Units previously communicated to the nominee by the Trust. After the transfer of Units to the DTC participant account of the nominee has been confirmed, the corresponding cash distribution will be paid by wire transfer to the account of the nominee (or in certain cases, as otherwise instructed by the claim holder). The transfer of the Units and the cash distribution will be made by Continental Stock Transfer, the transfer agent and registrar for the Trust. The Trust will make distributions of Units and cash to allowed claim holders who have not yet provided their brokerage information at intervals determined by the Trust, after the information is received. The Trust will make distributions of Units and cash from the Disputed Claims Reserve to holders of disputed claims that become allowed at intervals determined by the Trust. About the ResCap Liquidating Trust The ResCap Liquidating Trust was established under the Second Amended Joint Chapter 11 Plan of Residential Capital, LLC et al. for the purpose of liquidating and distributing the assets of the debtors in the ResCap bankruptcy case. 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. Judge Martin Glenn in December 2013 confirmed the Joint Chapter 11 Plan co-proposed by Residential Capital and the Official Committee of Unsecured Creditors. RGR WATKINS: Reaches Settlement With CJUF, Wants Case Dismissed --------------------------------------------------------------- RGR Watkins, LLC, has asked Hon. K. Rodney May of the U.S. Bankruptcy Court for the Middle District of Florida to dismiss its Chapter 11 case. The Debtor has reached a mediated settlement agreement with CJUF III Atlas Portfolio, LLC, as successor in interest to CSMI Investors LLC, as successor in interest to Bank of America, N.A., the Debtor's major secured creditor. CJUF has been the sole active creditor in the bankruptcy case. Elena Paras Ketchum, Esq., at Stichter, Riedel, Blain & Prosser, P.A., the attorney for the Debtor, says the Debtor intends to negotiate with its four unsecured creditors outside of court. Ms. Ketchum adds that dismissal is in the best interest of creditors as it effectuates the settlement agreement with CJUF and obviates the need for further litigation and administrative costs, which would be to the detriment of all creditors. Ms. Ketchum has consulted with Denise Barnett, attorney for the U.S. Trustee, and Denise Dell-Powell, counsel for CJUF, regarding dismissal of the case. Both the U.S. Trustee and CJUF consent to the dismissal. Ms. Dell-Powell can be reached at: Burr & Forman LLP 200 South Orange Avenue, Suite 800 Orlando, FL 32801 Tel: (407) 540-6607 Fax: (407) 264-6466 E-mail: denise.dell-powell@burr.com About RGR Watkins RGR Watkins, LLC, owns Watkins Business Center, which is comprised of 25 one-story office/flex buildings in Norcross, Gwinnett County, Georgia. The site is comprised of eight parcels totaling 41 acres or 1,778,147 square feet. RGR Watkins filed a petition for Chapter 11 protection (Bankr. M.D. Fla. Case No. 13-12147) on Sept. 12, 2013, in Tampa, Florida. The petition was signed by Robert G. Roskamp as manager. The Debtor estimated assets and debts of at least $10 million. The Debtor is represented by Elena P. Ketchum, Esq., and Amy Denton Harris, Esq., at Stichter, Riedel, Blain & Prosser, P.A., in Tampa, FL, as counsel. RIH ACQUISITIONS: Judge Approves Sale of Atlantic Club Casino ------------------------------------------------------------- Joseph Checkler, writing for The Wall Street Journal, reported that a judge on Dec. 23 approved the piecemeal sale of the Atlantic Club Casino Hotel to two of its rivals, which will shutter the venerable gambling hall for good by next month. According to the report, Judge Gloria M. Burns of U.S. Bankruptcy Court in Camden, N.J. approved the sale agreement, which calls for Caesars Entertainment Corp. to pay $15 million for the casino property and fixtures and Tropicana Entertainment Inc. to pay $8.4 million for Atlantic Club's slot machines and other gambling equipment. "The debtor has offered sufficient evidence that it exercised its business judgment," the judge said, although she pointed out that the sales fetched far less than Atlantic Club originally hoped for when it wished to sell itself to a buyer that would keep the business going, the report cited. Judge Burns overruled an objection from Sobe Holdings LLC, which tried to buy both the property and the gambling equipment but lost out at the auction, the report related. A lawyer for Sobe said Caesars was "not qualified" to buy part of Atlantic Club, and cross-examined Imperial Capital's Scott Farnsworth, an investment banking adviser to Atlantic Club who had determined Caesars's bid contained "less risk on closing," the report further related. About RIH Acquisitions RIH Acquisitions NJ LLC, doing business as the Atlantic Club Casino Hotel in Atlantic City, New Jersey, filed a Chapter 11 petition (Bankr. D.N.J. Case No. 13-34483) on Nov. 6, 2013, in Camden, New Jersey, designed to sell the property in the near term. The Debtors are represented by Michael D. Sirota, Esq., and Warren A. Ustaine, Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., in Hackensack, New Jersey; and Paul V. Shalhoub, Esq., at Willkie Farr & Gallagher LLP, in New York. Duane Morris, LLP, serves as the Debtors' special gaming regulatory counsel. Imperial Capital, LLC, serves as financial advisor and investment banker to the Debtors, while Mercer (US) Inc. serves as compensation consultant. Kurtzman Carson Consultants LLC is the Debtors' claims and noticing agent. Northlight Financial LLC, as DIP Lender, is represented by Harlan W. Robins, Esq., at Dickinson Wright PLLC, in Columbus, Ohio; Kristi A. Katsma, Esq., at Dickinson Wright PLLC, in Detroit, Michigan; and Bruce Buechler, Esq., and Kenneth A. Rosen, Esq., at Lowenstein Sandler LLP, in Roseland, New Jersey. Financing for the Chapter 11 reorganization is being provided by Northlight Financial LLC. RIVIERA DRILLING: Deadline Doesn't Apply to Block Creditor's Plan ----------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that if a small-business debtor fails to file a Chapter 11 plan within 300 days, a creditor can file and obtain confirmation of a plan later, the Bankruptcy Appellate Panel in Denver ruled on Dec. 17. According to the report, a bankrupt company didn't file a plan within the 300-day deadline established for small businesses under Section 1121(e)(2) of the Bankruptcy Code. Years later, a creditor filed a liquidating plan, which the court approved in a confirmation order. At the time the creditor's plan was pending, the U.S. Trustee had a motion on file seeking dismissal or conversion to Chapter 7. The company appealed from the confirmation order, contending that its failure to meet the 300-day deadline barred everyone from filing a plan. U.S. Bankruptcy Judge Robert E. Nugent rejected that argument in his opinion for the three-judge panel, which considers bankruptcy appeals Colorado, Kansas, New Mexico, Oklahoma, Utah and Wyoming. Judge Nugent said there was only one other case on the question of whether a creditor is barred from filing a plan if the debtor doesn't comply with the 300-day deadline. He said that applying the deadline against a creditor "to defeat a result that is otherwise beneficial to creditors and the estate makes little sense." The case is Thurner Industries Inc. v. Gunnison Energy Corp. (In re Riviera Drilling & Exploration Co.), 12-112, U.S. Bankruptcy Appellate Panel for the 10th Circuit (Denver). Riviera Drilling & Exploration Company filed for Chapter 11 bankruptcy (Bankr. D. Colo. Case No. 10-11902) on February 2, 2010. The Debtor employed Kutner Miller Brinen, P.C., as bankruptcy counsel. RJC REALTY: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: RJC Realty Holding Corp. dba Pure Maximus 399 Old Country Road Carle Place, NY 11514 Case No.: 13-76369 Chapter 11 Petition Date: December 23, 2013 Court: United States Bankruptcy Court Eastern District of New York (Central Islip) Judge: Hon. Robert E. Grossman Debtor's Counsel: Fred S Kantrow, Esq. THE LAW OFFICES OF AVRUM J. ROSEN, PLLC 38 New Street Huntington, NY 11743 Tel: (631) 423-8527 Fax: (631) 423-4536 Email: fkantrow@avrumrosenlaw.com - and - Avrum J Rosen, Esq. THE LAW OFFICES OF AVRUM J ROSEN, PLLC 38 New Street Huntington, NY Tel: 631-423-8527 Fax: 631-423-4536 Email: ajrlaw@aol.com Total Assets: $601,000 Total Liabilities: $1.51 million The petition was signed by Richard Calcasola, president. A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/nyeb13-76369.pdf SAN JOSE, CA: Judge Blocks Pension Cuts --------------------------------------- Dale Kasler, writing for The Sacramento Bee, reported that in a case with major implications for public employees around the state, a judge on Dec. 23 shot down a voter-approved measure in San Jose, California, that cuts workers' pensions. But the judge did say the city of San Jose could trim workers' salaries to achieve the desired savings. According to the report, the ruling by Santa Clara Superior Court Judge Patricia Lucas comes at a pivotal time as cash-strapped cities continue to scrutinize pensions as a potential target for cost cutting. The bankrupt city of San Bernardino has indicated it might try and slash its annual contribution to CalPERS, the report related. It may have gotten a recent legal boost when a bankruptcy judge in Michigan said the city of Detroit is free to go after pensions. CalPERS officials have said they think the Detroit ruling would have no bearing on public pensions in California, however. Meanwhile, San Jose Mayor Chuck Reed -- who championed the ballot initiative, Measure B, that was the subject of the Dec. 23 ruling -- is pushing for a separate, statewide public vote that would give state and local government agencies throughout California the right to impose cuts to pension plans for existing workers, the report said. Reed told the San Jose Mercury News that he was pleased that even though the pension cuts were blocked, the city can proceed with millions of dollars in pay cuts, the report further related. Although he would have preferred to reduce pension costs directly, "I think we'll get very close to what we had hoped for," he told the newspaper. SCICOM DATA: May Hire George McGunnigle as Mediator --------------------------------------------------- Scicom Data Services, Ltd., obtained authorization from the U.S. Bankruptcy Court for the District of Minnesota to employ George F. McGunnigle, an attorney and senior judge for the Hennepin County District Court, to mediate a claim objection. The Troubled Company Reporter reported on Dec. 19, 2013, that prior to the filing date, the Debtor and Actuate Corporation were involved in litigation in the U.S. District Court for the District of Minnesota regarding a software license. To compensate Judge McGunnigle for his mediation services, the Debtor and Actuate would each pay half of Judge McGunnigle's hourly rate of $400, plus expenses. Thus, the Debtor proposes to pay Judge McGunnigle $200 per hour, plus half of any expenses. About SCICOM Headquartered in Minnetonka, Minnesota, SCICOM provides data processing solutions that transform critical data into effective customer communications, on any platform, at any time. SCICOM's business focus has been employee benefits, retirement and investment services, and statement processing. SCICOM Data Services, Ltd., filed a Chapter 11 petition (Bankr. D. Minn. Case No. 13-43894) on Aug. 6, 2013, in Minneapolis, Minnesota, with a deal to sell assets to Venture Solutions without an auction. Arden Hills, MN-based Venture Solutions is a provider of print and digital transactional Communications and is a subsidiary of Taylor Corporation. Judge Michael E. Ridgway presides over the case. The Debtor has tapped Fredrikson & Byron, P.A., as counsel; Lighthouse Management Group, Inc., as financial consultant; and Shenehon Company as valuation expert. The Debtor disclosed $13,254,128 in assets and $17,801,787 in liabilities as of the Chapter 11 filing. The petition was signed by Timothy L. Johnson, senior vice president and CFO. Daniel M. McDermott, the U.S. Trustee for Region 12, appointed three creditors to serve in the Official Committee of Unsecured Creditors in the Chapter 11 case of Scicom Data Services, Ltd. SCICOM DATA: Court Okays HLB Tautges as Accountant -------------------------------------------------- The U.S. Bankruptcy Court for the District of Minnesota has granted SCICOM Data Services, Ltd., permission to employ HLB Tautges Redpath, Ltd., to perform various accounting services, consisting of: (a) preparing federal and state tax returns for the Debtor's 2013 fiscal year (ended June 30, 2013) and preparing final federal and state tax returns; (b) conducting ERISA-required audits for both the 2013 plan year (ended June 30, 2013) and 2014 plan year for the Debtor's defined benefit pension plan, employee stock ownership plan, and 401(k) plan; and (c) preparing Form 5500 for the Pension Plan for the 2013 and 2014 plan years. As reported by the Troubled Company Reporter on Nov. 18, 2013, the Debtor proposed that: (a) the flat fees totaling $42,300 ($9,000 for the tax return preparation and $33,300 for the audits and Form 5500 preparation) paid to HLB Tautges prior to the Filing Date for the Accounting Services be approved, without need for a fee application by HLB Tautges upon completion of the Accounting Services; and (b) in accordance with paragraph 9 of the Court's Instructions for Filing a Chapter 11 Case, if any Potential Additional Services become necessary (i) HLB Tautges be authorized to schedule a hearing on its applications for allowance of fees and reimbursement of expenses for the Potential Additional Services not more than once every 90 days; (ii) HLB Tautges be allowed to submit bills to the Debtor for Potential Additional Services provided, with copies to the Committee of Unsecured Creditors and the Office of the United States Trustee; and (iii) the Debtor be authorized to pay up to 80% of fees and 100% of costs on a monthly basis for Potential Additional Services provided by HLB Tautges, subject to later court approval under Section 330 of the Bankruptcy Code. About SCICOM Headquartered in Minnetonka, Minnesota, SCICOM provides data processing solutions that transform critical data into effective customer communications, on any platform, at any time. SCICOM's business focus has been employee benefits, retirement and investment services, and statement processing. SCICOM Data Services, Ltd., filed a Chapter 11 petition (Bankr. D. Minn. Case No. 13-43894) on Aug. 6, 2013, in Minneapolis, Minnesota, with a deal to sell assets to Venture Solutions without an auction. Arden Hills, MN-based Venture Solutions is a provider of print and digital transactional Communications and is a subsidiary of Taylor Corporation. Judge Michael E. Ridgway presides over the case. The Debtor has tapped Fredrikson & Byron, P.A., as counsel; Lighthouse Management Group, Inc., as financial consultant; and Shenehon Company as valuation expert. The Debtor disclosed $13,254,128 in assets and $17,801,787 in liabilities as of the Chapter 11 filing. The petition was signed by Timothy L. Johnson, senior vice president and CFO. Daniel M. McDermott, the U.S. Trustee for Region 12, appointed three creditors to serve in the Official Committee of Unsecured Creditors in the Chapter 11 case of Scicom Data Services, Ltd. SHILO INN, TWIN FALLS: Can Use CBT's Cash Collateral Until June 30 ------------------------------------------------------------------ The Hon. Vincent P. Zurzolo of the U.S. Bankruptcy Court for the Central District of California has entered a final order authorizing Shilo Inn, Twin Falls, LLC, et al., to use California Bank & Trust's cash collateral through June 30, 2014. The Debtors will provide adequate protection by making these monthly payments to CBT on the first day of the month, commencing on Feb. 1, 2014, and ending on July 1, 2014, with payments to be applied in arrears: Shilo Inn, Boise Airport, LLC $15,458.38 Shilo Inn, Moses Lake Inc. $11,810.83 Shilo Inn, Nampa Blvd, LLC $5,217.20 Shilo Inn, Newberg, LLC $6,569.81 Shilo Inn, Rose Garden, LLC $5,975.11 Shilo Inn, Seaside East, LLC $7,729.12 Shilo Inn, Twin Falls, LLC $23,187.62 About Shilo Inn, Twin Falls Shilo Inn, Twin Falls, LLC, and six affiliates filed a Chapter 11 petition (Bankr. C.D. Cal. Case No. 13-21601) on May 1, 2013. Judge Richard M. Neiter presides over the case. Shilo Inn, Twin Falls, estimated assets of at least $10 million and debts of at least $1 million. Shilo Inn, Twin Falls; Shilo Inn, Nampa Blvd, LLC; Shilo Inn, Newberg, LLC; Shilo Inn, Seaside East, LLC, Shilo Inn, Moses Lake, Inc.; and Shilo Inn, Rose Garden, LLC each operates and owns a hotel. California Bank and Trust is the primary, senior secured lender for each of the Debtors. The Debtors sought Chapter 11 protection after CBT on May 1, 2013, filed for receiverships in district court. David B. Golubchick, Esq., Kurt Ramlo, Esq., and J.P. Fritz, Esq., at Levene, Neale, Bender, Yoo & Brill LLP, in Los Angeles, represent the Debtors in their restructuring effort. The Debtors' Joint Plan of Reorganization dated Aug. 29, 2013, provides for payment of all claims in full, unless otherwise agreed with the claimholder, with unsecured claims to be paid over a three-month period from the Plan Effective Date. SIMPLY WHEELZ: Court Approves Advantage, Hertz Vehicle Settlement ----------------------------------------------------------------- Jacqueline Palank, writing for The Wall Street Journal, reported that Advantage Rent a Car won bankruptcy-court approval to settle a battle with former owner Hertz Global Holdings Inc. over leased vehicles and is now seeking to borrow more than $100 million to help build its own fleet of rental cars. According to the report, Judge Edward Ellington of the U.S. Bankruptcy Court in Jackson, Miss., signed off on the settlement with Hertz, which removes a significant obstacle to Advantage's future operations and will help pave the way for its proposed sale to a Canadian private-equity firm. Federal regulators ordered Hertz to spin off Advantage in connection with its $2.3 billion acquisition of Dollar Thrifty Automotive Group Inc., the report said. Under the spinoff, Hertz agreed to lease Advantage 24,000 vehicles. But disputes arose over the agreement, prompting Advantage to seek Chapter 11 protection in November, shortly after the divestiture was finalized. Under the settlement, reached earlier this month, Hertz will allow Advantage to continue using the vehicles for a limited amount of time in exchange for payments, the report related. Hertz also will pay Advantage's proposed buyer, Catalyst Capital Group Inc., $2.75 million when the sale closes. The deal with Hertz means that Advantage will now need to work on building its own fleet of rental cars, a step that recent court filings show the company already is taking, the report further related. 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 Ellington. 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. SOUND SHORE: Exclusive Plan Filing Deadline Moved to Jan. 24 ------------------------------------------------------------ The Hon. Robert D. Drain of the U.S. Bankruptcy Court for the Southern District of New York has extended -- at the behest of Sound Shore Medical Center of Westchester and its affiliates -- the exclusive periods within which the Debtors may file a Chapter 11 plan through and including Jan. 24, 2014, and the exclusive period within which the Debtors may solicit acceptances to the plan through and including March 25, 2014. As reported by the Troubled Company Reporter on Sept. 23, 2013, the Debtors asked the Bankruptcy Court to extend the exclusive periods, saying the filing of a plan of reorganization would be premature at this time, as the Debtors' efforts have been focused on addressing immediate concerns stemming from these filings and the anticipated sale of substantially all assets to Montefiore Medical Center's designees, many of must be resolved prior to the formulation of a plan. Among other things, the Debtors must attend not only to the administration of the estates and these cases, but cash management and the continued viability of operations, the myriad of information requests from the creditor constituencies, and the legal, operational and transitional issues relating to the sale and post closing process. About Sound Shore Medical Center of Westchester Sound Shore Medical Center of Westchester, Mount Vernon Hospital Inc., Howe Avenue Nursing Home and related entities sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 13-22840) on May 29, 2013, in White Plains, New York. The Debtors are the largest "safety net" providers for Southern Westchester County in New York. Affiliated with New York Medical College, Sound Shore is a not-for-profit 242-bed, community based- teaching hospital located in New Rochelle, New York. Mountain Vernon Hospital is a voluntary, not-for-profit 176-bed hospital located in Mount Vernon, New York. Howe Avenue Nursing Home is a 150-bed, comprehensive facility. The Debtors tapped Burton S. Weston, Esq., at Garfunkel Wild, P.C. as counsel; Alvarez & Marsal Healthcare Industry Group, LLC, as financial advisors; and GCG Inc., as claims agent. The Debtors are seeking to sell their assets to the Montefiore health system. In June 2013, Montefiore added $4.75 million to its purchase offer for Sound Shore Medical Center and Mount Vernon Hospital to speed up the sale. Montefiore raised its bid to $58.75 million plus furniture and equipment as part of a request for a private sale of the bankrupt New Rochelle and Mount Vernon hospitals, which the Bronx-based health system would like to buy by August 2. Montefiore is represented by Togut, Segal & Segal LLP. Alston & Bird LLP represents the Official Committee of Unsecured Creditors. Deloitte Financial Advisory Services LLP serves as its as financial advisor. Sound Shore disclosed assets of $159.6 million and liabilities totaling $200 million. Liabilities include a $16.2 million revolving credit and a $5.8 million term loan with Midcap Financial LLC. There is $9 million in mortgages with Sun Life Assurance Co. of Canada (US) and $11.5 million owing to the New York State Dormitory Authority. Neubert, Pepe & Monteith, P.C., represents Daniel T. McMurray, the patient care ombudsman for Sound Shore. SURTRONICS INC: Can Continue Cash Collateral Use Until Dec. 31 -------------------------------------------------------------- The Hon. Stephani W. Humrickhouse of the U.S. Bankruptcy Court for the Eastern District of North Carolina, in a second interim order, has authorized Surtronics, Inc., to use First Citizens Bank & Trust Co.'s cash collateral until Dec. 31, 2013. A copy of the budget is available for free at: http://bankrupt.com/misc/SURTRONICSINCcashcoll2budget.pdf First Citizens will have a lien post-petition on the Debtor's cash collateral, including insurance proceeds, to the same extent, validity, and priority as existed pre-petition. On Nov. 26, 2013, Judge Humrickhouse entered an order stating that in addition to those uses approved, on an interim basis, in the cash collateral order dated Oct. 29, the Debtor is authorized to use cash collateral outside the ordinary scope of business for the repair-related expenses generally set forth in this budget: http://bankrupt.com/misc/SURTRONICSINCcashcoll2budgetb.pdf In an agreed second motion dated Oct. 31, 2013, the Debtor stated that in June 2013, a fire resulted in significant damage at the Debtor's facility. Through this case, the Debtor has and continues to address its fire loss claims by rebuilding its manufacturing facility and continuing negotiations with the Debtor's insurance provider for resolution of the full claim of loss. In the meantime, the Debtor is moving forward with cleaning, repair and restoration of the fire-damaged area, and removal of damaged equipment and other property. According to David A. Matthews, Esq., at Shumaker Loop & Kendrick, LLP, the attorney for the Debtor, the repair expenses are largely one-time expenses not included in the Debtor's monthly operating budget approved by the Bankruptcy Court in the previous order, or in the subsequent budget for November and December 2013. The Debtor intends to use partial proceeds it has already received from its insurance claim to pay the repair expenses, and has sufficient cash-on-hand to make the payments without any detrimental effect on operations or the budgets. In the previous cash collateral order, the Bankruptcy Court ruled that the Debtor "may spend no more than the budget, with a ten percent variance allowance, without (i) advance consent of First Citizens, or (ii) further order of this Court." The Debtor reviewed the repair expenses with counsel for First Citizens. First Citizens approved payment of the repair expenses, and counsel for First Citizens consents to the relief requested in this motion. A hearing was slated for Dec. 19, 2013, to consider the Debtor's continued use of cash collateral. Results of that hearing are not yet available as of press time. First Citizens is represented by: Paul A. Fanning, Esq. WARD AND SMITH, P.A. P.O. Box 8088 Greenville, NC 27835-8088 E-mail: PAF@wardandsmith.com About Surtronics, Inc. Raleigh, North Carolina-based Surtronics, Inc., filed a Chapter 11 bankruptcy petition in Wilson, North Carolina (Bankr. E.D.N.C. Case No. 13-05672) on Sept. 9, 2013. Founded in 1965, Surtronics is in the business of providing electroplating and anodizing services to base-metal alloys for use across various industries, including but not limited to aerospace, defense, medical, telecommunications, and automotive. Surtronics' primary production facility and corporate office are located in a series of buildings at 4001 and 4025 Beryl Drive, and 508 Method Road, Raleigh, North Carolina. The Debtor is represented by David A. Matthews, Esq., at Shumaker, Loop & Kendrick, LLP, in Charlotte, North Carolina. Carr Riggs & Ingram PLLC, serves as its accountants. In its schedules, the Debtor disclosed $16,300,878 in total assets and $3,507,088 in total liabilities. SURTRONICS INC: May Hire Poyner Spruill as Special Counsel ---------------------------------------------------------- The Hon. Stephani W. Humrickhouse of the U.S. Bankruptcy Court for the Eastern District of North Carolina entered a consent order allowing Surtronics, Inc., to employ Keith Johnson, Esq., and Poyner Spruill LLP as special counsel. As reported by the Troubled Company Reporter on Oct. 21, 2013, the Bankruptcy Administrator asked the Court to deny the Debtor's request to employ Mr. Johnson and Poyner Spruill to provide legal advice about environmental conditions at the Debtor's facility on Beryl Road in Raleigh, North Carolina, and to represent the Debtor in pursuit of contributions to environmental costs the Debtor has and will incur from potentially responsible parties. The Bankruptcy Administrator said that the attorney and paralegal hourly rates sought by the firm appear to be excessive for the district. The engagement letter stated that Mr. Johnson's hourly rate is $430 and that paralegals charge between $180 and $220 per hour. The Debtor, Mr. Johnson, and the Bankruptcy Administrator have discussed the Bankruptcy Administrator's concerns and have agreed that the attorney hourly rates won't exceed $425 and the paralegal hourly rates won't exceed $135. About Surtronics, Inc. Raleigh, North Carolina-based Surtronics, Inc., filed a Chapter 11 bankruptcy petition in Wilson, North Carolina (Bankr. E.D.N.C. Case No. 13-05672) on Sept. 9, 2013. Founded in 1965, Surtronics is in the business of providing electroplating and anodizing services to base-metal alloys for use across various industries, including but not limited to aerospace, defense, medical, telecommunications, and automotive. Surtronics' primary production facility and corporate office are located in a series of buildings at 4001 and 4025 Beryl Drive, and 508 Method Road, Raleigh, North Carolina. The Debtor is represented by David A. Matthews, Esq., at Shumaker, Loop & Kendrick, LLP, in Charlotte, North Carolina. Carr Riggs & Ingram PLLC, serves as its accountants. In its schedules, the Debtor disclosed $16,300,878 in total assets and $3,507,088 in total liabilities. SURTRONICS INC: Amends Schedules of Assets & Liabilities -------------------------------------------------------- Surtronics, Inc., filed with the Bankruptcy Court its amended schedules of assets and liabilities in November, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $1,450,000 B. Personal Property 14,850,878 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $1,843,448 E. Creditors Holding Unsecured Priority Claims $19,740 F. Creditors Holding Unsecured Non-priority Claims 1,643,900 ----------- ----------- TOTAL $16,300,878 $3,507,088 A copy of the amended schedules is available for free at: http://bankrupt.com/misc/SURTRONICSINCamendedsal.pdf As reported by the Troubled Company Reporter on Sept. 11, 2013, the Debtor disclosed in its schedules that it owed $1,573,167 to creditors holding unsecured non-priority claims and that liabilities totaled $3,436,355. About Surtronics, Inc. Raleigh, North Carolina-based Surtronics, Inc., filed a Chapter 11 bankruptcy petition in Wilson, North Carolina (Bankr. E.D.N.C. Case No. 13-05672) on Sept. 9, 2013. Founded in 1965, Surtronics is in the business of providing electroplating and anodizing services to base-metal alloys for use across various industries, including but not limited to aerospace, defense, medical, telecommunications, and automotive. Surtronics' primary production facility and corporate office are located in a series of buildings at 4001 and 4025 Beryl Drive, and 508 Method Road, Raleigh, North Carolina. The Debtor is represented by David A. Matthews, Esq., at Shumaker, Loop & Kendrick, LLP, in Charlotte, North Carolina. Carr Riggs & Ingram PLLC, serves as its accountants. SURTONICS INC: No Creditors' Committee Appointed ------------------------------------------------ The Bankruptcy Administrator for the Eastern District of North Carolina has been unable to organize and recommend to the Bankruptcy Court the appointment of a committee of creditors holding unsecured claims against Surtronics, Inc. "Despite efforts by the Bankruptcy Administrator to contact unsecured creditors, as of the date of the Section 341 meeting of creditors, sufficient indications of willingness to serve on a committee of unsecured creditors were not received from persons eligible to serve on a committee," the Bankruptcy Administrator said in an Oct. 31 notice to the Bankruptcy Court. About Surtronics, Inc. Raleigh, North Carolina-based Surtronics, Inc., filed a Chapter 11 bankruptcy petition in Wilson, North Carolina (Bankr. E.D.N.C. Case No. 13-05672) on Sept. 9, 2013. Founded in 1965, Surtronics is in the business of providing electroplating and anodizing services to base-metal alloys for use across various industries, including but not limited to aerospace, defense, medical, telecommunications, and automotive. Surtronics' primary production facility and corporate office are located in a series of buildings at 4001 and 4025 Beryl Drive, and 508 Method Road, Raleigh, North Carolina. The Debtor is represented by David A. Matthews, Esq., at Shumaker, Loop & Kendrick, LLP, in Charlotte, North Carolina. Carr Riggs & Ingram PLLC, serves as its accountants. In its schedules, the Debtor disclosed $16,300,878 in total assets and $3,507,088 in total liabilities. T-L BRYWOOD: Has OK to Use RCG-KC's Cash Collateral Until Dec. 31 ----------------------------------------------------------------- T-L Brywood, LLC, has obtained permission from the Hon. J. Philip Klingeberger of the U.S. Bankruptcy Court for the Northern District of Indiana to use cash collateral of RCG-KC Brywood LLC, successor to The Private Bank and Trust Company, until Dec. 31, 2013. As adequate protection, the Lender will be granted valid, perfected, enforceable security interests in and to the Debtor's post-petition assets, to the extent and priority of its alleged prepetition liens, to the extent of any diminution in the value of the assets. About T-L Brywood T-L Brywood LLC filed for Chapter 11 bankruptcy (Bankr. N.D. Ill. Case No. 12-09582) on March 12, 2012. T-L Brywood owns and operates a commercial shopping center known as the "Brywood Centre" -- http://www.brywoodcentre.com/-- in Kansas City, Missouri. The Property encompasses roughly 25.6 acres and comprises 183,159 square feet of retail space that is occupied by 12 operating tenants. The occupancy rate for the Property is approximately 80%. The Debtor and lender The PrivateBank and Trust Company reached an impasse over the terms and conditions of another extension of a mortgage loan on the Property. As a result, the Debtor filed the Chapter 11 case to protect the Property from foreclosure while the Debtor formulates an exit strategy from the reorganization case. As of the Petition Date, no foreclosure relating to the Property had been filed by the Lender. Judge Donald R. Cassling oversees the case. The Debtor is represented by David K. Welch, Esq., Arthur G. Simon, Esq., and Jeffrey C. Dan. Esq., at Crane, Heyman, Simon, Welch & Clar, in Chicago. The Debtor disclosed total assets of $16,666,257 and total liabilities of $13,970,622 in its schedules. The petition was signed by Richard Dube, president of Tri-Land Properties, Inc., manager. PrivateBank is represented by William J. Connelly, Esq., at Hinshaw & Culbertson LLP. No committee of creditors was appointed by the U.S. Trustee. The case was transferred to the U.S. Bankruptcy Court for the Northern District of Indiana (Case. 13-21804) on May 14, 2013. TIM C. THOMAS INC: Case Summary & Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Tim C. Thomas, Inc. 2809 River Oaks Drive Richmond Hill, GA 31324 Case No.: 13-42350 Chapter 11 Petition Date: December 23, 2013 Court: United States Bankruptcy Court Southern District of Georgia (Savannah) Debtor's Counsel: James L. Drake, Jr., Esq. JAMES L. DRAKE, JR., P.C. P. O. Box 9945 Savannah, GA 31412 Tel: 912-790-1533 Email: jdrake7@bellsouth.net Total Assets: $4.47 million Total Liabilities: $5.23 million The petition was signed by Tim C. Thomas, president. The Debtor listed Georgia Power as its largest unsecured creditor holding a claim of $3,516. TLO LLC: Equity Holders Want Asher Loan Subordinated ---------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that non-insider equity holders of TLO LLC are entitled to a distribution following the $154 million sale of the business because an $89 million loan owing to the deceased founder should be treated as equity, according to a lawsuit begun in bankruptcy court by two shareholders. According to the report, TLO, a provider of risk-mitigation services, held an auction where TransUnion Holding Co. Inc. came out on top with a $154 million bid approved on Dec. 13 by the U.S. Bankruptcy Court in West Palm Beach, Florida. There is about $20 million in unsecured debt, according to the Dec. 20 lawsuit by Jules Kroll and Thomas H. Glover, who together own 11.3 percent of the equity. Kroll is the founder of Kroll Inc., the investigations firm. They contend that the $89 million secured loan made by TLO's deceased founder, Hank Asher, should be treated as equity or subordinated to creditors' claims. They contend TLO was initially undercapitalized. They lay out in the complaint how the Asher loan doesn't contains terms ordinarily found in a commercial lending arrangement and thus should be treated as equity. In October, TLO filed a liquidating Chapter 11 that would distribute assets according to priorities in bankruptcy law, with unsecured creditors taking what remains after secured creditors and those with priorities are paid in full. If the Asher loan is demoted to or below equity, creditors and other shareholders come out well after the sale to TransUnion, the complaint says. In addition to sale proceeds, assets available for creditors include recoveries from a $40 million policy on Asher's life. He died early this year before bankruptcy. About TLO LLC TLO LLC, a provider of risk-mitigation services, filed a petition for Chapter 11 reorganization (Bankr. S.D. Fla. Case No. 13-bk20853) on May 9, 2013, in West Palm Beach, Florida, near the company's headquarters in Boca Raton. The petition was signed by E. Desiree Asher as CEO. Judge Paul G. Hyman, Jr., presides over the case. Robert C. Furr, Esq., and Alvin S. Goldstein, Esq., at Furr & Cohen, serve as the Debtor's counsel. Bayshore Partners, LLC is the Debtor's investment banker. Thomas Santoro and GlassRatner Advisory & Capital Group, LLC are the Debtor's financial advisors. Paul J. Battista, Esq., and Mariaelena Gayo-Guitian, Esq., at Genovese, Joblove & Battista, P.A., represent the Official Committee of Unsecured Creditors as counsel. The Debtor disclosed assets of $46.6 million and liabilities of $109.9 million, including $93.4 million in secured claims. The principal lender is Technology Investors Inc., owed $89 million. TII is owned by the estate of Hank Asher, the company's primary owner who died this year. There is $4.6 million secured by computer equipment. UNITED PROPERTIES: Case Summary & 2 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: United Properties, LLC 702 Oberlin Road, #400 Raleigh, NC 27605 Case No.: 13-07926 Chapter 11 Petition Date: December 23, 2013 Court: United States Bankruptcy Court Eastern District of North Carolina (Raleigh Division) Judge: Hon. Stephani W. Humrickhouse Debtor's Counsel: George M. Oliver, Esq. OLIVER FRIESEN CHEEK, PLLC PO Box 1548 New Bern, NC 28563 Tel: 252 633-1930 Fax: 252 633-1950 Email: efile@ofc-law.com Total Assets: $5.87 million Total Liabilities: $5.30 million The petition was signed by James I. Anthony, Jr., member/manager. A list of the Debtor's two largest unsecured creditors is available for free at http://bankrupt.com/misc/nceb13-7926.pdf USEC INC: Says Energy Dept. Prepared to Extend Centrifuge Research ------------------------------------------------------------------ Michael Calia, writing for Daily Bankruptcy Review, reported that the U.S. Department of Energy is prepared to extend a cooperative centrifuge research program for three months beyond Jan. 15, uranium supplier USEC Inc. said. According to the report, shares of USEC, down 88% since late July, were up 4.6% at $3.66 after hours on Dec. 19. The announcement comes after USEC said it plans to file for bankruptcy early next year as it seeks to restructure its debt, the report related. The company said at the time that a debt- restructuring deal would help it continue the American Centrifuge program. The Energy Department and USEC would share the program's cost in an 80%/20% split, with total funding at about $10 million a month, USEC said, the report added. USEC said it would continue to work with the Energy Department and Congress, among others, to get the extension for the American Centrifuge program, which uses technology developed by the U.S., the report further related. USEC said the program achieved three milestones under a plan originally proposed by the Energy Department in 2011. About USEC Inc. Headquartered in Bethesda, Maryland, USEC Inc. (NYSE: USU) -- http://www.usec.com/-- supplies enriched uranium fuel for commercial nuclear power plants. USEC disclosed a net loss of $1.20 billion in 2012 as compared with a net loss of $491.1 million in 2011. The Company's balance sheet at Sept. 30, 2013, showed $1.70 billion in total assets, $2.16 billion in total liabilities and a $462.1 million stockholders' deficit. PricewaterhouseCoopers LLP, in McLean, Virginia, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012. The independent auditors noted that the Company has reported net losses and a stockholders' deficit at Dec. 31, 2012, and is engaged with its advisors and certain stakeholders on alternatives for a possible restructuring of its balance sheet, which raise substantial doubt about its ability to continue as a going concern. Bankruptcy Warning "A delisting of our common stock by the NYSE and the failure of our common stock to be listed on another national exchange could have significant adverse consequences. A delisting would likely have a negative effect on the price of our common stock and would impair stockholders' ability to sell or purchase our common stock. As of September 30, 2013, we had $530 million of convertible notes outstanding. Under the terms of our convertible notes, a "fundamental change" is triggered if our shares of common stock are not listed for trading on any of the NYSE, the American Stock Exchange (now NYSE-MKT), the NASDAQ Global Market or the NASDAQ Global Select Market, and the holders of the notes can require USEC to repurchase the notes at par for cash. We have no assurance that we would be eligible for listing on an alternate exchange in light of our market capitalization, stockholders' deficit and net losses. Our receipt of a NYSE continued listing standards notification described above did not trigger a fundamental change. In the event a fundamental change under the convertible notes is triggered, we do not have adequate cash to repurchase the notes. A failure by us to offer to repurchase the notes or to repurchase the notes after the occurrence of a fundamental change is an event of default under the indenture governing the notes. Accordingly, the exercise of remedies by holders of our convertible notes or the trustee of the notes as a result of a delisting would have a material adverse effect on our liquidity and financial condition and could require us to file for bankruptcy protection," the Company said in its quarterly report for the period ended Sept. 30, 2013. VERMILLION INC: Completes $17.6 Million Warrant Exercise -------------------------------------------------------- Vermillion, Inc., said Oracle Investment Management, Jack W. Schuler, Matthew W. Strobeck and certain other investors have exercised warrants to purchase 12.1 million shares of Vermillion common stock at an exercise price of $1.46 per share. The warrants were issued in conjunction with an equity financing transaction that closed on May 13, 2013. With the exercise of the warrants, Vermillion received $17.6 million in proceeds, bringing the total investment by investors in the May 2013 equity financing transaction to approximately $30.9 million, before transaction costs. Emerging Growth Equities, Ltd., advised Vermillion on the equity financing transaction. Proceeds from the warrant exercise will be used to increase test sales and improve reimbursement for OVA1, expand commercial opportunities in the U.S. and new markets and advance one or more next-generation ovarian cancer diagnostic tests. About Vermillion Vermillion, Inc., is dedicated to the discovery, development and commercialization of novel high-value diagnostic tests that help physicians diagnose, treat and improve outcomes for patients. Vermillion, along with its prestigious scientific collaborators, has diagnostic programs in oncology, hematology, cardiology and women's health. The Company filed for Chapter 11 on March 30, 2009 (Bankr. D. Del. Case No. 09-11091). Vermillion's legal advisor in connection with its successful reorganization efforts wass Paul, Hastings, Janofsky & Walker LLP. Vermillion emerged from bankruptcy in January 2010. The Plan called for the Company to pay all claims in full and equity holders to retain control of the Company. Vermillion incurred a net loss of $7.14 million in 2012, as compared with a net loss of $17.79 million in 2011. The Company's balance sheet at Sept. 30, 2013, showed $15.08 million in total assets, $4.84 million in total liabilities, and stockholders' equity of $10.25 million. BDO USA, LLP, in Austin, Texas, 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, all of which raise substantial doubt about the Company's ability to continue as a going concern. WR GRACE: Last Settlement Permits Chapter 11 Exit ------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that W.R. Grace & Co. settled the last appeal from approval of its reorganization plan and should be able to exit bankruptcy around the 13th anniversary of the Chapter 11 filing. According to the report, the company already defeated four appeals from approval of the reorganization plan dealing with asbestos liability. Emerging from reorganization remained blocked by the fifth and final appeal by secured bank lenders claiming the right to $185 million of interest at the contractual default rate. The lenders based their claim for a higher interest rate on the fact that shareholders are keeping stock worth $4.9 billion. The settlement announced on Dec. 23 calls for the lenders to receive $129 million in settlement of the claim for additional interest. They will also receive $971 million, representing the principal amount of the loan plus interest at the non-default rate. No appeals were taken to the U.S. Supreme Court from the four cases already decided by the U.S. Court of Appeals in Philadelphia. The U.S. Bankruptcy Court in Delaware will hold a hearing on Jan. 29 to consider approval of the settlement. Grace's Chapter 11 plan creates trusts to take care of existing and future asbestos claims. Banks filing the appeals include Bank of America NA, Barclays Bank Plc, and JPMorgan Chase Bank NA. About W.R. Grace Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally. Grace employs approximately 6,500 people in over 40 countries and had 2012 net sales of $3.2 billion. The company and its debtor-affiliates filed for chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP, represent the Debtors in their restructuring efforts. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. Roger Frankel serves as legal representative for victims of asbestos exposure who may file claims against W.R. Grace. Mr. Frankel, a partner at Orrick Herrington & Sutcliffe LLP, replaces David Austern, who was appointed to that role in 2004. Mr. Frankel has served as legal counsel for Mr. Austern who passed away in May 2013. The FCR is represented by Orrick Herrington & Sutcliffe LLP as counsel; Phillips Goldman & Spence, P.A., as Delaware co-counsel; and Lincoln Partners Advisors LLC as financial adviser. Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Scott Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod, LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel, LLP, represents the Official Committee of Equity Security Holders. W.R. Grace obtained confirmation of a plan co-proposed with the Official Committee of Asbestos Personal Injury Claimants, the Official Committee of Equity Security Holders, and the Asbestos Future Claimants Representative. The Chapter 11 plan is built around an April 2008 settlement for all present and future asbestos personal injury claims, and a subsequent settlement for asbestos property damage claims. Implementation of the Plan has been held up by appeals in District Court from various parties, including a group of prepetition bank lenders and the Official Committee of Unsecured Creditors. District Judge Ronald Buckwalter on Jan. 31, 2012, entered an order affirming the bankruptcy court's confirmation of the Plan. Bankruptcy Judge Judith Fitzgerald had approved the Plan on Jan. 31, 2011. The plan can't be implemented because pre-bankruptcy secured bank lenders filed an appeal currently pending in the U.S. Court of Appeals in Philadelphia. Bankruptcy Creditors' Service, Inc., publishes W.R. Grace Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). WAVE SYSTEMS: Completes $1.2 Million Stock Offering --------------------------------------------------- Wave Systems Corp. sold to investors 1,253,351 shares of its Class A common stock at a price of $0.9725 per share, yielding gross proceeds of approximately $1,218,885. Investors in the offering also received five-year warrants to purchase an aggregate of 626,674 shares of Wave's Class A common stock for $0.91 per share. The net proceeds of the financing will be used to fund Wave's ongoing operations. Security Research Associates acted as placement agent in connection with the offering. The shares and shares underlying the warrants in this offering are being issued under a shelf registration statement declared effective by the Securities and Exchange Commission on Sept. 12, 2013. A prospectus supplement related to the public offering will be filed with the Securities and Exchange Commission. Additional information is available for free at: http://is.gd/5rQ0Hb About Wave Systems Lee, Massachusetts-based Wave Systems Corp. (NASDAQ: WAVX) -- http://www.wave.com/-- develops, produces and markets products for hardware-based digital security, including security applications and services that are complementary to and work with the specifications of the Trusted Computing Group, an industry standards organization comprised of computer and device manufacturers, software vendors and other computing products manufacturers. For the 12 months ended Dec. 31, 2012, the Company incurred a net loss of $33.96 million, as compared with a net loss of $10.79 million in 2011. The Company's balance sheet at Sept. 30, 2013, showed $12.03 million in total assets, $19.82 million in total liabilities and a $7.79 million total stockholders' deficit. KPMG LLP, in Boston Massachusetts, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012. The independent auditors noted that Wave Systems Corp. has suffered recurring losses from operations and has an accumulated deficit that raise substantial doubt about its ability to continue as a going concern. WESTERN FUNDING: Westlake Services Wins Auction for Loans --------------------------------------------------------- Tom Corrigan, writing for DBR Small Cap, reported that Westlake Services LLC, a subprime auto lender, topped stalking horse bidder Carfinco Financial Group Inc. at a bankruptcy auction for Western Funding Inc.'s assets, with a winning bid of more than $26.2 million. According to the report, the proceeds from the sale, which requires court approval, will go toward repaying some of Western Funding's $30.8 million bank loan. A hearing to approve the sale was scheduled for Dec. 20 in U.S. Bankruptcy Court in Las Vegas. As reported by the TCR on Nov. 22, 2013, the Debtors filed a proposed Chapter 11 plan that contemplates the transfer of equity interests to Carfinco, absent higher and better offers at a court- sanctioned auction. Carfinco offered $24.5 million for the assets. Carfinco, a Canadian car finance giant, will collect a breakup fee of $365,000 and an expense reimbursement of $450,000, protections that were put in place when it agreed to serve as the lead bidder in November, the report said. Carfinco had agreed to pay the value of 70% of the finance receivables owed to Western Funding. "The bidding reached a purchase price which exceeded management's upper threshold for risk versus returns on equity deployed," said Tracy Graf, Carfinco's chief executive, in a press release, the report cited. Las Vegas-based Western Funding has struggled to repay a loan organized by Chicago-based BMO Harris Bank, which declared the loan agreement to be in default in April, citing Western Funding's interest coverage ratio amount and its minimum loss reserve levels, the report further related. Cody Lyon, reporting for autofinancenews.net, reports that court- appointed ombudsman, Timothy Yoo, filed a statement Dec. 19 over consumer privacy concerns. He said the proposed sale of Western's auto finance contracts to Westlake violates Western's privacy policy and will require analysis under section 332 of the Bankruptcy Code. About Western Funding Inc. Las Vegas car-loan maker Western Funding Inc. filed for Chapter 11 bankruptcy protection (Bankr. D. Nev. Case No. 13-17588) on Sept. 4, 2013, after its own lender said the company broke borrowing promises made in 2012. Matthew C. Zirzow, Esq., at Larson & Zirzow, LLC, in Las Vegas, Nevada, represents the Debtor. The Debtors tapped FTI Consulting, Inc., as investment bankers to assist with sales transactions. Jeanette E. McPherson, Esq., at Schwartzer & McPherson Law Firm represents the Official Committee of Unsecured Creditors. The Committee retained Amherst Consulting, LLC, as investment banker. WHEATLAND MARKETPLACE: Can Use Cash Collateral Until Jan. 31 ------------------------------------------------------------ The Hon. Pamela S. Hollis of the U.S. Bankruptcy Court for the Northern District of Illinois entered an interim order allowing Wheatland MarketPlace, LLC, to use until Jan. 31, 2014, the cash collateral of U.S. Bank National Association, as Trustee for Bear Stearns Commercial Mortgage Securities, Inc., Commercial Mortgage Pass-Through Certificates, Series 2003-TOP12 acting by and through C-III Asset Management LLC, in its capacity as special servicer pursuant to an Oct. 1, 2003 pooling and servicing agreement. A copy of the budget is available for free at: http://bankrupt.com/misc/WHEATLANDMARKETPLACEcashcollbudget.pdf The cash collateral includes any cash or cash equivalents, funds or proceeds of or from that certain improved real property described in the certain mortgage and security agreement dated Aug. 27, 2003, executed by the Debtor for the benefit of Principal Commercial Funding, LLC, to pay operating expenses of the Property. As adequate protection for the Debtor's use of cash collateral, (a) the Debtor will make a $95,020.58 payment to the Noteholder by Jan. 15, 2014; provided, however, that the application of the payment by the Noteholder against any indebtedness owing in accordance with the terms of the loan documents will be provisional only and subject to further court order, and (b) the Noteholder will have nunc pro tunc as of the commencement of the Chapter 11 case, a replacement lien and security interest on all property acquired or generated postpetition by the Property, to the same extent and priority and of the same kind and nature as the Noteholder's prepetition liens and security interests in the cash collateral. A hearing on the Debtor's cash collateral use will be held Jan. 28, 2014. About Wheatland Marketplace Wheatland Marketplace, LLC, owner of a commercial retail center in Naperville, Illinois, filed a Chapter 11 bankruptcy petition (Bankr. N.D. Ill. Case No. 13-46492) in Chicago on Dec. 3, 2013. The Debtor has tapped Thomas W Toolis, Esq., at Jahnke, Sullivan & Toolis, LLC, in Frankfurt, Illinois, as counsel. Coleen J. Lehman Trust and Lucy Koroluk each holds a 50% membership interest in the Debtor. WPCS INTERNATIONAL: Investors Swap $827,000 Notes for Equity ------------------------------------------------------------ Between Dec. 17, 2013, and Dec. 19, 2013, WPCS International Incorporated received conversion notices to issue an aggregate of 4,153,179 shares of its common stock, par value $0.0001 per share, to six investors upon the conversion of $827,000 of principal face value secured convertible notes issued Dec. 5, 2012. The shares were issued pursuant to the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended. As of the close of business on Dec. 19, 2013, the Company had 5,711,848 shares of Common Stock deemed issued and outstanding. About WPCS International WPCS International -- http://www.wpcs.com-- is a design-build engineering company that focuses on the implementation requirements of communications infrastructure. The company provides its engineering capabilities including wireless communications, specialty construction and electrical power to the public services, healthcare, energy and corporate enterprise markets worldwide. CohnReznick LLP, in Roseland, New Jersey, expressed substantial doubt about WPCS International's ability to continue as a going concern following the annual report for the year ended April 30, 2013. The independent auditors noted that the Company has incurred net losses and negative cash flows from operating activities, had a working capital deficiency as of and for the years ended April 30, 2013, and 2012, and has an accumulated deficit as of April 30, 2103. The Company reported a net loss of $6.8 million on $42.3 million of revenue in fiscal 2013, compared with a net loss of $20.6 million on $65.5 million in fiscal 2012. The Company's balance sheet at Oct. 31, 2013, showed $18.41 million in total assets, $13.87 million in total liabilities, and $4.54 million in total equity. YRC WORLDWIDE: Has Deal With Noteholders to Cut Debt by $300MM -------------------------------------------------------------- YRC Worldwide, Inc. on Dec. 23 disclosed that it has reached an agreement with certain holders of its Series A Convertible Notes, Series B Convertible Notes and other institutional investors that will allow it to reduce debt by approximately $300 million. In doing so, the company will meet a primary requirement (retiring at least 90% of the company's Series A and B Convertible Notes) needed to satisfy the International Brotherhood of Teamsters' (IBT) conditionality of ratifying the Memorandum of Understanding (MOU) proposal that is currently out for ratification by the company's employees who are IBT members. However, the agreement will still remain contingent on getting the MOU proposal ratified by its members. The vote on the MOU is anticipated to be complete on January 8, 2014 and results will be available shortly thereafter. In addition, the debt reduction deal is contingent on getting holders of at least 90% of the $124 million of the company's pension fund debt to amend and extend the currently outstanding note. "The agreement is a momentous step toward delevering the company's balance sheet, significantly improving the company's credit profile, and is expected to secure some of the best paying jobs in the LTL industry," said James Welch, Chief Executive Officer of YRC Worldwide and President of YRC Freight. "The last two years have been a long and hard fought journey in turning around one of the largest trucking companies in America. After shedding a significant portion of our non-core assets and operations and with the help of our unionized and non-unionized employees, we have focused our attention back to what we do best -- North American LTL trucking." Under the agreement, the investors will invest $250 million in cash for newly-issued shares of common stock of YRC Worldwide at a price of $15.00 per share. The proceeds will be used to pay off the existing 6% Convertible Notes due February 2014 and defease and/or pay off the existing Series A Convertible Notes due March 2015. In addition, holders of approximately $50 million principal amount of the existing Series B Convertible Notes due March 2015 will convert those notes to common stock at a price of $15.00 to $16.01 per share, further reducing debt. The Series B Note holders that participate in the proposed transaction will also consent to amend the indenture to remove substantially all covenants and release the collateral securing those notes. The remaining Series B Convertible Notes may continue to be outstanding until their scheduled maturity of March 31, 2015. Consummation of the agreement is subject to a number of other customary conditions as well. "These transactions will result in a substantial reduction of our debt and will position the company to address impending maturities, including the 6% Convertible Notes due in February 2014," said Jamie Pierson, YRC Worldwide Chief Financial Officer. "These transactions also clear the way for us to enter the senior debt markets to refinance our current term and asset- based loans at more favorable interest rates." "We must now focus on the upcoming ratification vote and amendment and extension of the pension note as the two final steps in completing this major debt reduction transaction and reestablishing YRCW as a leader in the LTL industry. With a positive ratification vote and an amended and extended pension fund note, the improved financial picture will allow the company to increase its investment in new tractors, trailers, technology and equally if not more importantly training and developing its people. Alternatively, if we are not successful, it would unfortunately mean some very difficult decisions for the company and its employees," added Mr. Welch. About YRC Worldwide Headquartered in Overland Park, Kan., YRC Worldwide Inc. (NASDAQ: YRCW) -- http://www.yrcw.com/-- is a holding company that offers its customers a wide range of transportation services. These services include global, national and regional transportation as well as logistics. After auditing the 2011 results, the Company's independent auditors expressed substantial doubt about the Company's ability to continue as a going concern. KPMG LLP, in Kansas City, Missouri, noted that the Company has experienced recurring net losses from continuing operations and operating cash flow deficits and forecasts that it will not be able to comply with certain debt covenants through 2012. For the year ended Dec. 31, 2012, the Company incurred a net loss of $136.5 million on $4.85 billion of operating revenue, as compared with a net loss of $354.4 million on $4.86 billion of operating revenue during the prior year. As of Sept. 30, 2013, the Company had $2.13 billion in total assets, $2.79 billion in total liabilities and a $665.8 million total shareholders' deficit. * * * As reported by the TCR on Aug. 2, 2013, Moody's Investors Service affirmed the rating of YRC Worldwide, Inc., corporate family rating at Caa3. The ratings outlook is has been changed to positive from stable. "The positive ratings outlook recognizes the important progress that YRCW has made in restoring positive operating margins through implementation of yield management initiatives, during a period of stabilizing demand in the less than truckload ('LTL') segment," the report stated. In August 2011, Standard & Poor's Ratings Services raised its corporate credit rating on YRC Worldwide Inc. to 'CCC' from 'SD' (selective default), after YRC completed a financial restructuring. Outlook is stable. "The ratings on Overland Park, Kan.-based YRCW reflect its participation in the competitive, capital-intensive, and cyclical trucking industry," said Ms. Ogbara, "as well as its meaningful off-balance-sheet contingent obligations related to multiemployer pension plans." "YRCW's substantial market position in the less- than-truckload (LTL) sector, which has fairly high barriers to entry, partially offsets these risk factors. We categorize YRCW's business profile as vulnerable, financial profile as highly leveraged, and liquidity as less than adequate." YUKOS OIL: Russia Supreme Court to Review Khodorkovsky Cases ------------------------------------------------------------ Lukas I. Alpert and Olga Razumovskaya, writing for The Wall Street Journal, reported that Russia's Supreme Court opened a review into the cases against recently released oil tycoon Mikhail Khodorkovsky and his jailed business partner to determine how to address alleged procedural flaws. According to the report, the exact impact of the Russian court's ruling wasn't immediately clear, but a court official said the review -- which may take up to two months -- could lead to an adjustment of the terms of the 2005 tax-evasion conviction against the two men or even a possible retrial. The report related that the move also could open the door to Mr. Khodorkovsky's possible return to Russia from Berlin, where he flew after being pardoned by President Vladimir Putin and released from a Russian prison after serving more than 10 years. His imprisonment had been seen by many as politically motivated because of his criticism of the Kremlin and his political ambitions, the report said. His business partner, Platon Lebedev, remains behind bars and is scheduled to be released in May. The two men have long proclaimed their innocence, insisting the cases against them were political retribution, the report further related. About Yukos Oil Headquartered in Moscow, Yukos Oil -- http://yukos.com/-- was an open joint stock company under the laws of the Russian Federation. Yukos was involved in energy industry substantially through its ownership of its various subsidiaries, which own or are otherwise entitled to enjoy certain rights to oil and gas production, refining and marketing assets. The Company filed for Chapter 11 protection on Dec. 14, 2004 (Bankr. S.D. Tex. Case No. 04-47742), but the case was dismissed on Feb. 24, 2005, by the Hon. Letitia Z. Clark. A few days later, the Russian Government sold its main production unit Yugansk to a little-known firm Baikalfinansgroup for US$9.35 billion, as payment for US$27.5 billion in tax arrears for 2000-2003. Yugansk eventually was bought by state-owned Rosneft, which is now claiming more than US$12 billion from Yukos. On March 10, 2006, a 14-bank consortium led by Societe Generale filed a bankruptcy suit in the Moscow Arbitration Court in an attempt to recover the remainder of a US$1 billion debt under outstanding loan agreements. The banks, however, sold the claim to Rosneft, prompting the Court to replace them with the state- owned oil company as plaintiff. On April 13, 2006, court-appointed external manager Eduard Rebgun filed a chapter 15 petition in the U.S. Bankruptcy Court for the Southern District of New York (Bankr. S.D.N.Y. Case No. 06-0775), in an attempt to halt the sale of Yukos' 53.7% ownership interest in Lithuanian AB Mazeikiu Nafta. On May 26, 2006, Yukos signed a US$1.49 billion Share Sale and Purchase Agreement with PKN Orlen S.A., Poland's largest oil refiner, for its Mazeikiu ownership stake. The move was made a day after the Manhattan Court lifted an order barring Yukos from selling its controlling stake in the Lithuanian oil refinery. On Aug. 1, 2006, the Hon. Pavel Markov of the Moscow Arbitration Court upheld creditors' vote to liquidate OAO Yukos Oil Co. and declared what was once Russia's biggest oil firm bankrupt. On Nov. 23, 2007, the Russian Trading System and Moscow Interbank Currency Exchange stopped trading Yukos shares after the company formally ceased to exist. Mr. Rebgun completed the company's liquidation process after Russia's Federal Tax Service has entered Yukos' liquidation on the Uniform State Register of Legal Entities. As reported in the Troubled Company Reporter-Europe on Nov. 14, 2007, the Moscow Arbitration Court entered an order closing the liquidation proceedings of Yukos, 15 months after it was declared bankrupt on Aug. 1, 2006. ZLOMREX INTERNATIONAL: Finance Company Seeks U.S. Protection ------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Zlomrex International Finance SA, the financing vehicle for an integrated Polish steel producer, filed a Chapter 15 petition on Dec. 23 in Manhattan to assist a U.K. court in extending the Feb. 1 maturity of 117.9 million euros ($161.49 million) in 8.5 percent senior secured notes. According to the report, the notes provided primary financing for affiliates Hutta Stali Jakosciowych SA, Ferrostal Labedy Sp, Zlomrex Metal Sp, and their parent Cognor SA. The company said it would be unable to refinance the notes at maturity. Although the financing vehicle is a French-incorporated business, the company said that bankruptcy proceedings in France were impracticable because it would touch off defaults on other obligations. Chapter 11 in the U.S. was rejected because of "high costs," according to a court filing. Instead, the company in November initiated proceedings in the Chancery Division of the High Court of Justice of England and Wales designed to effect a scheme of arrangement under U.K. law, akin to Chapter 11 in the U.S. For full payment under the scheme, there is already agreement with holders of 69 percent of the notes where they will be given new secured notes maturing in 2010 for 80 percent of the current debt. The other 20 percent will be in the form of exchangeable debt securities to mature in 2021. The company said total debt of the financing vehicle is 126.1 million euros. If enough noteholders accept the proposal, it can be consummated as an exchange offer without court intervention. The steel-producing affiliates have 5.5 percent of the Polish market. They were hurt by the decline in European and Polish steel consumption and prices. If the U.S. Bankruptcy Court determines that the company's main bankruptcy is in the U.K., creditor actions in the U.S. will be halted, and the U.S. court can assist in enforcement of the U.K. bankruptcy scheme. The case is In re Zlomrex International Finance SA, 13-14138, U.S. Bankruptcy Court, Southern District New York (Manhattan). ZLOMREX INTERNATIONAL: Chapter 15 Case Summary ---------------------------------------------- Chapter 15 Petitioner: Krzysztof Zola Chapter 15 Debtor: Zlomrex International Finance S.A. 90 Long Acre Covent Garden London WC2E 9RZ Chapter 15 Case No.: 13-14138 Type of Business: Steel company Chapter 15 Petition Date: December 23, 2013 Court: United States Bankruptcy Court Southern District of New York (Manhattan) Judge: Hon. Sean H. Lane Chapter 15 Petitioner's Counsel: Richard A. Graham, Esq. WHITE & CASE, LLP 1155 Avenue of the Americas New York, NY 10036 Tel: (212) 819-8630 Fax: (212) 354-8113 Email: rgraham@whitecase.com - and - Scott G. Greissman, Esq. WHITE & CASE LLP 1155 Avenue of the Americas New York, NY 10036 Tel: (212) 819-8567 Fax: (212) 354-8113 Email: sgreissman@whitecase.com Estimated Assets: $100 million to $500 million Estimated Debts: $100 million to $500 million * Child Tax Credit Doesn't Qualify as Exempt Property ----------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the portion of an income tax refund attributable to a federal child tax credit isn't a public assistance benefit qualifying as an exempt asset, the Bankruptcy Appellate Panel in St. Louis ruled on Dec. 23. According to the report, an individual in Chapter 13 claimed that a refund attributable to a federal child tax credit qualified as a public assistance benefit that is an exempt asset under Missouri law. U.S. Bankruptcy Judge Charles L. Nail Jr. rejected the argument, writing for the three-judge appellate panel. Judge Nail found the answer in the plain meaning of "public assistance" contained in the dictionary. He noted that the tax credit of $1,000 for each child is available for a couple with less than $110,000 of adjusted gross income. He said that a couple with that much income isn't "needy" and thus can't exempt the refund. The case is Hardy v. Fink (In re Hardy), 13-6029, U.S. Eighth Circuit Bankruptcy Appellate Panel (St. Louis). * Mortgage Enforceable Without Interest Rate or Maturity -------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that a recorded mortgage in Illinois is enforceable in bankruptcy even if it didn't state the interest rate or the maturity date, the U.S. Court of Appeals in Chicago ruled on Dec. 23. According to the report, lower federal courts in Illinois reached different conclusions, Circuit Judge David F. Hamilton said in his opinion for the three-judge court. Before amendment in 2013, the Illinois statute contained a permissive rather than a mandatory list of items for inclusion in a recorded mortgage. The interest rate and maturity date were among them. In the two cases before the Seventh Circuit in Chicago, the recorded mortgage didn't specify either item. However, the interest rate and maturity were contained in the mortgage note incorporated by reference in the mortgage. The case involved the so-called strong-arm power where a trustee has the status of a hypothetical bona-fide purchaser without notice of a non-recorded mortgage. Judge Hamilton concluded that a bankruptcy trustee had sufficient constructive notice about the mortgage under Illinois law. He said it was "hard to imagine" that a purchaser who discovered a recorded mortgage would believe it was unenforceable because the interest rate and maturity weren't shown on public records. He also said there were no Illinois authorities saying that a recorded mortgage is unenforceable for lack of those items. The case is In re Crane, 13-1518, U.S. Court of Appeals for the Seventh Circuit (Chicago). * Real Estate Broker's Contested Commission Is Dischargeable Debt ----------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Wisconsin real estate brokers failed to persuade the U.S. Court of Appeals in Chicago to adopt a rule that would make a debt automatically non-dischargeable if a bankrupt broker violated an exclusive-listing agreement. According to the report, the standard real estate listing agreement makes a property owner liable for the commission. That liability extends beyond the end of the agreement and if the broker contacts a prospective buyer while the agreement is in effect, the owner is still liable for the commission, even if that customer buys the property within a year after exclusivity expires. In this case, a broker left a firm that had a listing agreement with a homeowner. He went to work for another firm and, less than a year after exclusivity expired, sold the home to a buyer he had located while at his prior firm. The "old" firm sued the broker for a $6,000 commission and won a judgment of about $10,000. The broker filed for Chapter 7 bankruptcy. In bankruptcy court, the "old" employer unsuccessfully contended that the judgment wasn't dischargeable because it was a willful and malicious injury to property under Section 523(a)(6) of the Bankruptcy Code. Writing for the U.S. Court of Appeals in Chicago, Chief Judge Diane P. Wood said the "old" broker was required to prove, among other things, that the bankrupt intended to injure and that the injury was substantially certain to occur. The bankruptcy judge had ruled that the bankrupt wasn't aware he had a continuing obligation to his prior employer once he joined another firm. Also, the "old" broker could have collected from the owner. The case is First Weber Group Inc. v. Horsfall, 13-1026, U.S. Court of Appeals for the Seventh Circuit (Chicago). * American Express Reaches Add-On Card Settlement ------------------------------------------------- Alan Zibel and Robin Sidel, writing for The Wall Street Journal, reported that American Express Corp. reached a $76 million settlement with federal regulators over allegations it misled consumers about the benefits of extra card services such as identity-theft protection. According to the report, the New York-based company agreed on Dec. 24 to pay $16.2 million in fines to the Federal Deposit Insurance Corp., Office of the Comptroller of the Currency and the Consumer Financial Protection Bureau and issue $59.5 million in refunds to more than 335,000 customers. The company said in a statement that most of the money has already been paid to customers. The case is the latest in a string of actions by regulators against credit-card products known as "add-ons" that companies say offer extra protection to customers, the report related. Regulators say the credit-card companies' marketing of such products has often been deceptive and that the benefits of such services are often less than advertised. The identity-theft protection service offered by AmEx cost as much as $15.99 a month, but consumers often received little benefit, regulators said. The regulators also accused AmEx of misleading consumers about the benefits of a product that canceled debt if a customer lost a job or became disabled, the report said. While some consumers were led to believe the product would cover their payments in the event of a job loss, such payments were capped at $500, regulators said. "Consumers deserve to be treated fairly and should not pay for services they do not receive," said the CFPB's director, Richard Cordray, in a statement, the report further related. * Housing Sales Rise to Highest Level Since 2008 ------------------------------------------------ Jia Lynn Yang, writing for The Washington Post, reported that pent-up demand for housing continues to lift new-home sales figures to their highest levels since 2008, according to new monthly figures released Tuesday by the Commerce Department. According to the report, new-home sales in November hit an annualized rate of 464,000, which is 16.6 percent higher than a year ago. The figure slipped 2.1 percent from October, but the rate of sales is still just below a five-year high. Although the housing market still has a long way to go to make a full recovery, analysts said the latest numbers point to positive trends that are likely to pick up more steam in the new year, helping to buttress the U.S. economy even further as it slowly picks up momentum, the report related. "The numbers keep improving every month," said Patrick Newport, an economist with research firm IHS Global Insight, the report cited. "They're improving slowly, but they're improving. This is one of the key pieces of the recovery." Newport said that based on current U.S. demographics, a healthy, normal housing market would see about 800,000 new-home sales in a year, the report further related. IHS estimates that there will be about 430,000 sales this year and roughly 560,000 next year. * PNC Agrees to Pay $35MM to Settle Discriminatory Loan Claims -------------------------------------------------------------- Associated Press reported that PNC Financial Services Group is paying $35 million to resolve government claims of discrimination in car loans against a Cleveland-based bank that PNC bought in 2009. According to the report, the agreement by the Justice Department and the Consumer Financial Protection Bureau addresses claims that more than 75,000 African-American and Latino customers of National City Bank paid more for their car loans between 2002 and 2008. There is no allegation of discrimination by Pittsburgh-based PNC, which bought National City Bank. The discrimination settlement follows a similar but larger $98 million agreement between the government and Detroit-based Ally Financial Inc., the report related. * Volcker Rule Challenged in U.S. Court by American Bankers Asso. ----------------------------------------------------------------- Joel Rosenblatt, writing for Bloomberg News, reported that the final version of the Volcker Rule was challenged in a lawsuit over claims that requiring small banks to divest their holdings in some collateralized debt obligations will cause them about $600 million in losses. According to the report, the American Bankers Association, which represents mostly community banks, objects to a portion of the rule that will force lenders to get rid of CDOs backed by trust- preferred securities, according to the complaint filed on Dec. 24 in federal court in Washington. The association seeks a court order blocking the rule from taking effect before the end of the year. "Without the requested relief, hundreds of community banks across the nation will be required to recognize unexpected and, in many cases, significant earnings and capital losses on or before December 31, 2013," according to the complaint, the report cited. The rule named for former Fed Chairman Paul Volcker, who championed it as an adviser to President Barack Obama, was included in the 2010 Dodd-Frank Law that overhauled U.S. financial regulation as a way to restrict banks' proprietary trading and other risky bets after the 2008 credit crisis, the report said. The Fed has given banks a delay until July 21, 2015, to comply. The final version approved by the Federal Reserve System, Federal Deposit Insurance Corp., Securities and Exchange Commission, Commodity Futures Trading Commission and Office of the Comptroller of the Currency includes CDOs in the definition of covered funds subject to restriction, the report said. The Federal Reserve, the FDIC and the OCC are named as defendants in the Dec. 24 complaint. * BOOK REVIEW: Creating Value through Corporate Restructuring: Case Studies in Bankruptcies, Buyouts, and Breakups -------------------------------------------------------------- Author: Stuart C. Gilson Publisher: Wiley Hardcover: 516 pages List Price: $79.95 Review by David M. Henderson Most business books fall into two categories. The first is very important. It is like that stuff you have to drink before you have a colonoscopy. You keep telling yourself, this is very good for me, while you would rather be at the beach reading Liar's Poker or Barbarians at the Gate. Stuart Gilson, of the Harvard Business School, has managed to write a book important to everybody in the distressed market that is also quite enjoyable. His prose is fluid and succinct and a pleasure to read. But don't take my word for it. The dust jacket endorsements come from Jay Alix, Martin Fridson, Harvey Miller, Arthur Newman, and Sanford Sigoloff. At a collective gazillion dollars a billing hour, that's a lot of endorsement. Be advised that this is designed as a text book. The case study format might be off-putting to some. The effect can be jarring as you read the narrative history of the case and suddenly confront the financial statements without any further clue as to what to do, but this must be what it is like for the turnaround manager. Even after reading several of the cases, when I got to the financials I had that sinking feeling of, what do I do now? If you read carefully, clues to the solutions are in the introductions. The book is divided into three "modules", bizspeek for sections: Restructuring Creditors' Claims,. Restructuring Shareholders' Claims, and Restructuring Employees' Claims. The text covers 13 corporate restructurings focusing on debt workouts, vulture investing, equity spinoffs, tracking stock, assete divestitures, employee layoffs, corporate downsizing, M & A, HLTs, wage give- backs, employee stock buyouts, and the restructuring of employee benefit plans. That's a pretty comprehensive survey, wouldn't you say? Dr. Gilson's chapter on "Investing in Distressed Situations" is an excellent summary of the distressed market and a good touchstone even for seasoned vultures. Even in the two appendices on technical analysis, this book is marvelously free of those charts and graphs that purport to show some general ROI of distressed investing. Those are cute, aren't they? As Judy Mencher has famously said, "You can buy the paper at 50 thinking it's going to 70, but it can just as easily go to 30 if you are not willing to act on it." Therein lies the rub and the weakness, if inevitable, of this or any book on corporate restructurings. As Dr. Gilson notes, no two are alike, and the outcome is highly subjective, in our out of Court, but especially in Chapter 11. Is the Judge enthralled by Jack Butler as Debtor's Counsel or intimidated by Harvey Miller as Debtor's Counsel? Are you holding "secured" paper only to discover that when it was issued the bond counsel forgot to notify the Indenture Trustee of the most Senior debt? Is somebody holding Junior paper that you think is out of the money only to have Hugh Ray read the fine print and discover that the "Junior" paper is secured? This is the stuff of corporate reorganizations that is virtually impossible to codify into a textbook. That said, this is an especially valuable text for anybody working in the distressed market. As a Duke grad, I tend to be disdainful of all things Harvard, but having read Dr. Gilson's book, I am enticed to encamp by the dirty waters of the Charles long enough to take his course, appropriately entitled, "Creating Value Through Corporate Restructuring." ********* 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 ***